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812 F.Supp. 255 (1993)
Michael P. TICE, et al., Plaintiffs,
v.
PRO FOOTBALL, INC., d/b/a Washington Redskins, et al., Defendants.
Civ. A. No. 91-2314 (RCL).
United States District Court, District of Columbia.
February 10, 1993.
Joseph D. Yablonski, Daniel B. Edelman, John F. Colwell, Yablonski, Both & Edelman, Washington, DC, James W. Quinn, Weil, Gotshal & Manges, New York City, for plaintiffs.
Herbert Dym, Gregg H. Levy, Jeffrey Pasu, Covington & Burling, Washington, DC, for defendants.
MEMORANDUM OPINION AND ORDER FORTHWITH
LAMBERTH, District Judge.
This case is a putative class action in *256 which eleven professional football players[1] are suing the National Football League (NFL) and its twenty-eight member teams for anti-trust violations. The plaintiffs seek to represent a class of all professional football players who received less than their contract-based salary during the past several preseasons (due to the NFL's policy of paying all players a fixed salary during the preseason rather than their contract-based salary) and then were unable to make up the difference during the regular season because they were cut.[2]
After plaintiffs filed suit, the NFL filed a counterclaim in which it sought to certify a defendants' class of all players who received non-contractual benefits under the NFL's attested policy of following the CBA even after it expired in 1987. The counterclaim alleges that thousands of football players are liable for recoupment or restitution to their teams for such benefits as extra-contractual preseason compensation, post-season bonuses, and termination benefits. The court has not ruled on either plaintiffs' or defendants' motion for class certification.
During the last six years, various groups of players, often supported by the National Football League Players Association (NFLPA), have brought several lawsuits against the NFL, all challenging aspects of the NFL's player selection, retention, and compensation practices. Much of that litigation has been focused in this court, where three cases have been filed; even more has centered around the United States District Court for the District of Minnesota and U.S. District Judge David Doty.
Over the past several months, the NFL and its players have been attempting to resolve their employment disputes by combining a new collective bargaining agreement with the resolution of most of the NFL player litigation. That global settlement is being coordinated by Judge Doty.
Until recently, this case, filed on behalf of the eleven named plaintiffs by counsel Joseph A. Yablonski of the firm Yablonski, Both & Edelman, was not part of the negotiations for the global settlement. However, both the NFL and the representatives of the players have asserted, both before Judge Doty and orally in open court here,[3] that this case must be included in the global settlement if the settlement is to be achieved. The representation of the players in the settlement negotiations is headed by attorney James W. Quinn of the firm Weil, Gotshal & Manges.
In late January, three of the named plaintiffs[4] asked Mr. Yablonski to withdraw his appearance on their behalf; Mr. Yablonski thus moved this court to withdraw his firm's appearance and the court granted his motion. Mr. Quinn has entered his appearance on behalf of the three plaintiffs.[5]
*257 Thus, this case comes before the court on defendants' motion to transfer this case to the District of Minnesota in order that it may be part of the global settlement. Mr. Quinn, on behalf of the plaintiffs he represents, concurs.[6] Mr. Yablonski, however, has opposed the motion on behalf of the plaintiffs and would-be intervenor-plaintiff represented by his firm.
The court held a status conference on January 27, 1993, and has received briefs from both the defendants and the plaintiffs represented by Mr. Yablonski. Upon consideration of the representations of the parties, and for the reasons stated below, the court grants defendants' motion.
DISCUSSION
Under 28 U.S.C. § 1404(a), the court is empowered to transfer a case if to do so would be "in the interest of justice." The court finds that transferring this case meets this standard.
The NFL and its players have been unable to reach an employment agreement since the CBA expired in 1987. During that time, the parties have been involved in numerous lawsuits in which plaintiffs have been only partially successful that have used up a significant quantity of resources, both judicial and private. And, due to the nature of American litigation and appellate processes, the court anticipates that, absent a settlement, the trend will continue for years to come.
The global settlement currently before Judge Doty will remedy this situation by not only resolving most of the litigation resulting from Plan B and the CBA, but also by removing the need for further litigation. The court finds it in the interests of judicial economy to support this effort. It is pointless to keep separate two highly related cases at this time.
The plaintiffs represented by Mr. Yablonski make several arguments against transferring this case. Each of these arguments may have significant merit, and the court acknowledges that Judge Doty will have to address each of these issues in order to ensure that the settlement afforded to the members of the White and Tice class is fair. Briefly summarized, the arguments are as follows:
1. Plaintiffs assert that Mr. Quinn and Weil, Gotshal & Manges cannot serve as adequate counsel for the Tice class, should it be certified, due to a conflict of interest.[7] However, Mr. Quinn is counsel for the White class, whose interests may well be divergent from the Tice classmembers' interests.[8] If Judge Doty finds that the classmembers' interests are divergent, Mr. Quinn might be precluded from representing the Tice plaintiffs.
2. Plaintiffs also raise doubts about the adequacy of the White named plaintiffs. Apparently, none of the White named plaintiffs has received less compensation due to his being cut prior to the end of the season. The typicality of the class representatives is therefore in question.
*258 3. Plaintiffs raise serious concerns about the adequacy of the named representatives in the Tice litigation as well. Under the terms of the settlement, each of the plaintiffs who has dropped Mr. Yablonski in favor of Mr. Quinn will receive his full damages; the rest of the class will receive only a pro rata share of a limited pool (which Mr. Yablonski claims is approximately $5 million). Thus, those named plaintiffs will receive several times the damages similarly-situated classmembers will receive. Although courts have approved settlements in which named plaintiffs receive higher awards, rarely is the discrepancy between the amount received by the named plaintiffs and the amount given to the classmembers as great as in this case. In addition, discrepancies are disfavored and are not approved pro forma. When they are approved, it is usually because there are sufficient justifications: for instance, the named plaintiffs may have taken great risks in going forward with the litigation or may have expended significant time or resources into the lawsuit. Finally, there appears to be an attempt to induce these named plaintiffs to "sell out" Mr. Yablonski in order to get the settlement on track; if Judge Doty find this to be the case, these individuals may have a conflict which would prevent them from serving as adequate class representatives.
4. Another issue raised by plaintiffs concerns the fact that interests not directly involved by the White case are subject to settlement here. Plaintiffs cite the court to Super Spuds, Inc. v. New York Mercantile Exchange, 660 F.2d 9 (2d Cir.1981), in which Judge Friendly rejected a class settlement because the settlement precluded claims not immediately pertinent to that lawsuit. Here, where the Tice plaintiffs' allegations involve issues (the CBA) that are not specifically and directly addressed by Plan B, Judge Doty will have to address whether the White plaintiffs even possess the authority to settle the Tice claims.
5. Also in Super Spuds, the court noted that a settlement that is contrary to the interests of some may not be approved solely because it is beneficial to the class as a whole. Plaintiffs have expressed doubts that, in the hopes of wrapping up all the NFL litigation, the interests of the Tice plaintiffs will be sacrificed.
All of the questions and issues raised by plaintiffs' counsel are potent reminders to the court that the interests of many individuals are at stake. However, at this point, they are premature. At present, no class either plaintiff or defendant has been certified. And, to date, the settlement has not been finalized. These concerns become relevant when and if a class is certified and those class members become part of the global settlement.
Nonetheless, the court is greatly troubled by this motion, and it is only with great reluctance that the court approves the transfer. The court faces a dilemma. One choice is to deny defendants' motion to transfer; although this would give the court the ability to ensure that plaintiffs' rights are fully protected, it would almost certainly destroy all hopes of a settlement that has the potential to benefit these plaintiffs, not to mention an entire industry. To transfer the case, however, opens up the possibility for this settlement, but places these plaintiffs in a less-certain position. (And, given the number of issues that must be addressed prior to the settlement taking effect, it is not at all clear that a settlement is possible.)
The court is also troubled by the manner in which the NFL and the players have approached this case in their settlement negotiations. Mr. Yablonski made it eminently clear to counsel for the NFL that Mr. Quinn had no authority to settle the Tice litigation when, as before the end of January, Mr. Quinn represented none of the plaintiffs in this case. Mr. Yablonski has successfully represented the NFLPA and its players in litigation before this court, and the court must question the motives of the NFL and the players association when they conduct negotiations for a settlement and reach an agreement to settle the Tice case without even consulting Mr. Yablonski, the only attorney of record at that point for the plaintiffs in the Tice case. There is also a serious question as to the propriety of Mr. Quinn's communicating *259 with Tice plaintiffs who were then represented by Mr. Yablonski.[9]
CONCLUSION
In light of the arguments plaintiffs raise and these issues, it is evident that Judge Doty faces several serious issues regarding this case. Mr. Yablonski will have the opportunity to raise each of these issues to Judge Doty on behalf of the players he represents. The court is confident that Judge Doty will competently address these issues and ensure that these plaintiffs are adequately represented and fairly treated.
Therefore, it is hereby ORDERED that this case shall be transferred FORTHWITH to the United States District Court for the District of Minnesota for the purposes of settlement pursuant to 28 U.S.C. § 1404(a).[10]
SO ORDERED.
NOTES
[1] On January 26, 1993, Gary Hogeboom moved to intervene as a plaintiff and, should the class be certified, a class representative. The court has not yet acted on Mr. Hogeboom's motion.
[2] The NFL and its players agreed to a collective bargaining agreement (CBA) in 1982 which governed professional football player relations from 1982 to 1987. Upon its expiration, the players and owners were unable to agree to its extension; nor could they agree to the terms of a new CBA. The NFL, however, continued to operate, in many respects, as if the CBA had been extended.
Under the CBA, the NFL paid all players a fixed salary of either $500 or 700 each week during the preseason and 100 percent of their contractual salary prorated over the sixteen or seventeen weeks of the regular season. Even though the NFL was adhering to these CBA terms, all football players signed a contract which provided that each would receive his annual salary as follows: 10 percent paid over the course of preseason and 90 percent paid over the course of the regular season. For almost all players, the NFL's fixed preseason salary was less than each player's contractual preseason salary. However, if a player lasted in the NFL for the full season, the player benefited under the CBA as he received not only 100 percent of his contractual salary, but also the fixed preseason amount.
This suit was brought by, and on behalf of, players who did not survive the complete season. As a result of NFL's anti-trust violations, they allege, their compensation was less than if the NFL had paid them according to their contracts, not according to the CBA.
[3] The court held a status conference on January 27, 1993.
[4] Plaintiffs Tice, Utt, and Judson.
[5] Mr. Quinn has also entered an appearance for two more individuals, plaintiffs Keys and Rimington. However, Mr. Yablonski is still counsel of record for these two individuals.
[6] The court agreed on January 27, 1993, to transfer a second football player suit, Lewis v. NFL, Civ. Action No. 91-2685 (RCL), to the District of Minnesota only for purposes of participation in the global settlement. In that case, Mr. Quinn, who filed suit on behalf of the players and was their counsel, concurred in the NFL defendants' motion to transfer. A third case, Brown v. Pro Football, Inc., Civ. Action No. 90-1071 (RCL), also pending before the court, is not part of the settlement; there has been no motion to transfer it to Minnesota.
[7] This court found that Weil, Gotshal & Manges at one point did have a conflict of interest in Lewis that prevented a class from being certified; that same conflict is not applicable to this case.
[8] Due to the fact that there is a limited settlement pool, any increase in payment to the Tice classmembers necessarily reduces the amount each White classmember receives. Although every Tice classmember apparently is also a White classmember, none of the named plaintiffs in White, it appears, has suffered the same injuries the Tice classmembers have suffered. Mr. Quinn's representation of the White plaintiffs may place him in de facto conflict with the Tice classmembers.
[9] Mr. Quinn defended himself at oral argument to charges that he had solicited these plaintiffs by stating that he did not make the first contact to any player. He conceded that he returned their telephone calls and spoke to them at a time that they were still represented by Mr. Yablonski. The court does not address this issue as it has not been properly raised and briefed. Judge Doty can address this issue as well, should he believe it appropriate.
[10] Both the plaintiffs represented by Mr. Quinn and defendants acknowledged in open court that the transfer of the case is for settlement purposes only. In addition, the same parties consent to the transfer of this case back to this court should the proposed settlement between the National Football League and the players not be achieved. Based on the prior representations of the plaintiffs represented by Mr. Yablonski, the court does not doubt that they also would consent to a transfer back to this court should a settlement not be achieved.
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649 P.2d 1126 (1982)
In the Matter of the Tax Appeal of HABILITAT, INC., Taxpayer.
No. 7048.
Supreme Court of Hawaii.
August 18, 1982.
*1128 Wesley H. Sakai, Jr., Honolulu (Jay M. Fidell, Honolulu, with him on the briefs; Edward R. Bendet, Honolulu, with them on reply brief; Bendet, Fidell & Sakai, Honolulu, of counsel), for taxpayer-appellant.
T. Bruce Honda, Deputy Atty. Gen., Honolulu (Harriet Yoshida Lewis, Deputy Atty. Gen., Honolulu, on the brief), for appellee Dept. of Taxation.
Before RICHARDSON, C.J., LUM and NAKAMURA, JJ., MARUMOTO, Retired Justice, in place of MENOR, J., excused, and OGATA, Retired Justice, Assigned Temporarily.
NAKAMURA, Justice.
Habilitat, Inc. (Habilitat or the taxpayer), a Hawaii non-profit corporation, appeals from a decision and order of the Tax Appeal Court upholding the assessment by the Director of Taxation of general excise taxes on the gross income derived from certain of its activities and of use taxes on goods it ordered from out-of-state suppliers for subsequent delivery to other persons in Hawaii. It claims the gross income in question is exempt from taxation pursuant to several provisions of HRS Chapter 237 and its ordering of goods for delivery to others in Hawaii did not subject it to taxation pursuant to HRS § 238-2(1). From a review of the record, we are convinced that the gross *1129 income in question for the fiscal years ending in June of 1974, 1975, and 1976, except for the "rent" received from Habilitat's residents and staff, was properly taxed and that the purchases from out-of-state suppliers were subject to the use tax.
I.
Habilitat's primary activity is rehabilitation; it maintains a residential program to foster the rehabilitation of persons with character disorders, including those induced or complicated by drug or alcohol abuse. It is exempted from the payment of federal income taxes as a charitable and educational organization within the purview of § 501(c)(3) of the Internal Revenue Code. It has also been recognized by the Director of Taxation since 1977 as an exempt organization for purposes of the general excise tax law.[1] Habilitat's operation is funded from various sources, including government grants, food stamps, the Aloha United Fund, interest and dividend income, and activities conducted by the organization.
The present controversy arose on October 11, 1977 when the Director of Taxation served a Notice of Assessment of Additional General Excise and Use Taxes for the fiscal years ending June 1974, June 1975, and June 1976 on the taxpayer, whereby general excise taxes in the sum of $39,799.91 in addition to taxes theretofore paid for those years were assessed and use taxes in the sum of $3,647.87 for the same period were assessed. The notice also included assessments of penalties and interest in addition to the unpaid taxes. The excise taxes were levied on gross income derived by the taxpayer from the following activities and sources:
(1) Retailing gross income derived from Habilitat's sales of tangible personal property such as "advertising specialty items", wood products, candles, cook-books, donated goods, matches, and posters.
(2) Services gross income derived from the performance of work on construction projects, painting and repair jobs, and landscaping jobs by the residents of Habilitat.
(3) Rentals gross income derived from Habilitat's operation of various housing accommodations for its residents and staff.
(4) Interest interest received by Habilitat pursuant to an agreement of sale covering certain real property located in Kaneohe, Hawaii.
(5) Other sources
(a) Benefit concerts gross income derived from benefit concerts conducted on Habilitat's behalf.
(b) Speaking engagements gross income derived from the speaking engagements of Habilitat's founder before various community groups.
(c) Consultant fees gross income derived from the American Alcoholic Treatment Facility in Honolulu in payment for Habilitat's assistance in the former's rehabilitation program.
(d) Vending machines gross income derived from the operation of vending machines located on Habilitat's premises.
(e) Film income gross income derived from the public showing of a film produced by Habilitat, "Story of Survival".
The use taxes were levied on the "purchases" by Habilitat of "advertising specialty items" from out-of-state suppliers for delivery to other persons in Hawaii.
*1130 Habilitat paid the assessed taxes, penalties, and interest under protest and sought relief from the Tax Appeal Court. The assessments were adjusted in the course of the appeals, resulting in revised assessments of $16,774.36 on account of general excise taxes and $2,307.84 on account of use taxes, together with penalties and interest thereon. The court sustained the revised assessments and entered judgment in favor of the Director of Taxation for the adjusted sums. The taxpayer's appeal to this court followed.
The dispositive questions on the levy of additional excise taxes are whether the receipts in question were from activities of Habilitat exempted from excise taxation pursuant to HRS § 237-23(b) or whether the receipts were from activities with a primary purpose of producing income, "even though the income is to be used for or in furtherance of the exempt activities."[2] A further issue in this regard is whether some of the receipts were gifts rather than taxable gross income. The issue relative to the use tax law is whether Habilitat engaged in taxable transactions when it ordered items of personal property from out-of-state suppliers for direct delivery to persons in Hawaii.[3]
II.
A.
The general excise tax, the State's principal source of governmental revenues, is "imposed upon entrepreneurs for the privilege of doing business." In re Tax Appeal of Central Union Church, 63 Haw. 199, 202, 624 P.2d 1346, 1349 (1981). It "applies at all levels of economic activity from production or manufacturing to retailing ... and to virtually all goods and services." Id. But "[i]ts inherent pervasiveness ... is mitigated by limited categories of exemptions ... provided for certain persons or entities, certain activities, and described transactions." Id. at 202-03, 625 *1131 P.2d at 1349.[4] Among these is the exemption provided by HRS § 237-23(b) for the gross income derived from the charitable, educational, communal, or social welfare activities of an entity organized and operated exclusively for charitable or educational purposes. The exemption, however, does not extend to the proceeds of any activity designed to produce income, even if such receipts are thereafter employed to further the organization's altruistic goals. It applies only where the primary purpose of the particular activity is not to produce income and the activity is also a primary reason for the organization's existence. Id. at 208-09, 624 P.2d at 1352-53; The Oceanic Foundation v. Kondo, 53 Haw. 1, 5-6, 486 P.2d 396, 398 (1971).
B.
1.
Habilitat argues the gross income generated by the sales of tangible personal property and the performance of work on construction and landscaping jobs by its residents falls within the foregoing exempt category because the activities are expressly designed to aid in the rehabilitation of the alienated individuals who are the beneficiaries of its program. The development of economic self-reliance, it claims, is vital to the program Habilitat has fostered. This factor, it says, distinguishes the activities in question from the situation where a private school whose educational activities have been exempted from taxation pursuant to HRS § 237-23 sponsored a fund-raising carnival. The argument is not without appeal.
Yet, it cannot be denied that the activities have a primary purpose of producing income for Habilitat's operation. And where the object of economic gain predominates, the activity does not meet the exemptive test propounded by In re Tax Appeal of Central Union Church, despite an integration of the economic activity with the purpose for which the entity was organized.
2.
The thesis advanced above is reiterated to support the taxpayer's position that the payments received in the form of "rent" from Habilitat's residents and staff are not subject to taxation. But here, the argument supports the claim of exemption a residential setting where stringent rules of conduct are enforceable forms the core of Habilitat's program.
Some of the receipts in question consist of a portion of the welfare benefits received from the State Department of Social Services and Housing (DSSH) to cover food, housing, and other needs of participants in the program. In the initial phase of an individual's rehabilitative process none of the payments received from the DSSH on his account is allocated to "rent", and no issue has been raised about these payments.[5] But as he progresses through the program, part of the payments received from the DSSH on his behalf is allocated to cover housing and designated for bookkeeping purposes as "rent" received from him. The taxpayer objects to the assessment of excise taxes on the portion of the payments designated as "rent". For the designation, it claims, is only intended "to promote a recognition by the residents that they will have to be responsible for such expenses once they leave the program, and to assist ... [Habilitat] in analyzing the costs of ... its program." In re Tax Appeal of Central Union Church, supra, definitely supports the taxpayer's position here.
*1132 The "rent" received from some of Habilitat's employees is also at issue. The persons to whom such payments are attributed, though technically employees, are participants in the program whose rehabilitation is considered nearly complete. They remain as residents of Habilitat, continue to participate in the program, and assist other residents who are still in the early phases of rehabilitation. They receive salaries from which they pay set amounts to help defray the cost of housing them at Habilitat.[6] The monthly "rent" for one of these persons is equivalent in the sum allocated for housing an individual in the category described earlier. In re Tax Appeal of Central Union Church likewise aids the taxpayer's cause here.
The transactions at issue did not have a primary purpose to produce income; the parties have agreed that "[n]o profit was made by ... [Habilitat] in connection with these rentals." See note 6, supra. The sums credited as "rent" here are, in our opinion, analogous to the monthly service fees received from the elderly residents of the retirement residence operated by the Central Union Church which were "applied to cover operating costs" there. See In re Tax Appeal of Central Union Church, supra, 63 Haw. at 209, 624 P.2d at 1353.
That these receipts flow from the operation of ... [Habilitat] itself rather than from another activity with a different purpose is obvious. Nor is there any question that the primary, if not the exclusive, purpose of the relevant transactions is to further .. . [Habilitat's] objective of providing housing and other services for ... [the participants in its rehabilitation program], and not to produce "income".
Id. HRS § 237-23(b) thus frees the receipts in question from the levy of excise taxes.
But the Director of Taxation raises still another possible barrier, a procedural one, to the allowance of the claim of exemption. He apprises us of the taxpayer's failure to comply with the provisions of HRS § 237-23(b)(1) which make annual registration as an exempt organization a prerequisite for exempt status, and maintains the neglect is fatal.[7] We are of course mindful that statutory directives of this nature are generally regarded as mandatory. Perry v. Planning Commission, 62 Haw. 666, 678-79, 619 P.2d 95, 104 (1980); 2A C. Sands, Sutherland on Statutory Construction § 57.19, at 445 (4th ed. 1973).
The Stipulation of Facts upon which the taxpayer's appeal to the Tax Appeal Court was determined nevertheless states in part:
Appellant has also requested and received approval from the Department of Taxation of the State of Hawaii, of its exemption from the payment of general excise taxes under the provisions of Section 237-23, Hawaii Revised Statutes, as amended, for the period beginning January *1133 1, 1971 and ending June 30, 1978. Copies of Appellant's Application for Exemption and of the letter from the Department of Taxation of the State of Hawaii dated September 7, 1977 confirming this exemption are attached hereto as Exhibits 5 and 6, respectively.
and
For purposes of this tax appeal, the statements made in this Stipulation of Facts may be accepted as fact, and the Exhibits referred to herein and attached hereto may be treated as authentic and true copies of the originals thereof.
We cannot ignore the "fact" that the taxpayer has "received approval from the Department of Taxation" of its exempt status "for the period beginning January 1, 1971 and ending June 30, 1978," which covers the fiscal years implicated in the appeal, notwithstanding the alleged neglect. The cited impediment, we must conclude, has been removed by agreement of the Department of Taxation.
3.
The taxpayer next posits a claim that interest payments received in 1975 and 1976 from the sale of real property under an agreement of sale are not subject to excise taxes. The proposition advanced here is that the transaction did not give rise to excise tax liability because Habilitat "is not and has not been engaged in `business'."
The tax scheme established by HRS Chapter 237, however, levies charges on economic activity, whether carried on by one engaged in "business" or by an organization with charitable aims. The legislature, as we have seen, has been most niggardly in meting out exemptions therefrom. And the interest payments received from the sale of real property are definitely not exempt, though the recipient may be an exempt organization within the meaning of HRS § 237-23(a)(6). For "gross income" as defined by HRS § 237-3 specifically covers interest, and the transaction had a purpose of producing income. While the section further provides that "gross income" does not include "gross receipts ... from the sale of land in fee simple," we have previously ruled that interest payments do not fall within this exclusion. Hawaiian Beaches, Inc. v. Kondo, 52 Haw. 279, 282, 474 P.2d 538, 540 (1970).
4.
Habilitat's theses regarding the gross income from "other sources" benefit concerts, speaking engagements, consultation services, vending machines, and the showing of a film are essentially those expounded earlier. Since the performers at the benefit concerts contributed their services, it further claims the receipts derived therefrom were actually "gifts". It likewise views the gross income from the sale of donated items in a category discussed earlier as "gifts".
We experience no difficulty in concluding the activities here had a primary purpose of generating income for use in Habilitat's program, although the speaking engagements and the furnishing of consultant services also furthered educational objectives. We also find the contentions that the receipts from the benefit concerts and the sale of the donated items were non-taxable donations lack merit. As the tickets and the items in question were sold with economic gain as the object, what was received by Habilitat from the sales was taxable. Thus, all of the gross income from "other sources" was properly taxed.
III.
Having disposed of the excise tax issues we focus on the remaining question that warrants discussion, whether Habilitat's ordering of items from out-of-state suppliers for direct delivery to persons in Hawaii were transactions subject to HRS Chapter 238, the Use Tax Law.
HRS § 238-2 imposes a levy "on the use in this State of tangible personal property which is imported, or purchased from an unlicensed seller, for use in this State." The tax buttresses the general excise tax as it is designed to prevent the avoidance of excise taxes through direct purchases from *1134 the mainland.[8] Its ultimate purpose is to remove the competitive advantage an out-of-state wholesaler or retailer would otherwise have over a seller subject to the payment of State excise taxes.
At issue are the transactions where residents of Habilitat solicited orders for "advertising specialty items" for direct delivery to others by mainland suppliers. The items in question "consist of various products which are embossed with the name[s] of the businesses to whom these products are sold." The Stipulation of Facts presented to the Tax Appeal Court contained the following resume of a typical transaction:
A sales order is prepared by the salespersons [sic] at the time of the sale and transmitted to Appellant's office in Hawaii. A purchase order is then issued to the mainland suppliers (Arthur Salm of Minneapolis, Missouri and HIT Corporation of New York), who then transmit the goods ordered directly to the purchaser.
The taxpayer does not deny it caused the "advertising specialty items" to be imported. But it maintains this affords no basis for the assessment of use taxes because it neither possessed nor used the items. In its view, the ordering of the articles constituted "mere importation without `use'." The statute, however, does not lend itself to the reading suggested by Habilitat.
We noted earlier that the enactment of the use tax in 1965 was prompted in part by the "substantial volume of sales by unlicensed sellers to local buyers [that] ... escape[d] taxation because such sales ... [were] accomplished directly between buyer and seller without the services of an intermediary." See note 8 supra. We may thus assume the relevant measure was intended to seal what was perceived as an escape hatch. Read in this light, the language of HRS Chapter 238 leaves no doubt that the import of the articles was subject to the use tax, notwithstanding that the transactions were structured to effect direct delivery of the purchased items.
HRS § 238-1 defines "use" as any use, whether the use is of such nature as to cause the property to be appreciably consumed or not, or the keeping of the property for such use or for sale, and shall include the exercise of any right or power over tangible personal property incident to the ownership of that property.
The statutory term thus covers the exercise of any right or power incident to the ownership of personal property. Habilitat exercised such right or power over the "advertising specialty items" when it directed the unlicensed sellers to transmit the purchased goods to persons who had ordered them from its residents. The transactions were clearly within the reach of the use tax.
Although other issues are raised, we find that they do not warrant further discussion.
The decision of the Tax Appeal Court is affirmed in part and reversed in part, and the case is remanded for the entry of a judgment consistent with this opinion.
NOTES
[1] HRS § 237-23(a) (1976) read in relevant part:
This chapter shall not apply to the following persons:
... .
(6) Corporations, associations, or societies organized and operated exclusively for religious, charitable, scientific, or educational purposes, as well as that of operating senior citizens housing facilities qualifying for a loan under the laws of the United States as authorized by section 202 of the Housing Act of 1959, as amended by the Housing Act of 1961, the Senior Citizens Housing Act of 1962, the Housing Act of 1964, and the Housing and Urban Development Act of 1965 as well as that of operating a prepaid legal services plan.
[2] HRS § 237-23(b) (1976) read:
(b) The exemptions enumerated in subsection (a)(6) to (9) shall apply only:
(1) To those persons who shall have registered with the department of taxation on or before January 31 of each calendar year, or within one month after the commencement of business, by filing a written application for registration in such form as the department shall prescribe, and shall have paid for the registration an annual fee of $1, and shall have had the exemption allowed by the department or by a court or tribunal of competent jurisdiction upon appeal from any assessment resulting from disallowance of the exemption by the department; and
(2) To activities from which no profit inures to the benefit of any private stockholder or individual, except for death or other benefits to the members of fraternal societies; and
(3) To the fraternal, religious, charitable, scientific, educational, communal, or social welfare activities of such persons, or to the activities of such hospitals, infirmaries, and sanitaria as such, and not to any activity the primary purpose of which is to produce income even though the income is to be used for or in furtherance of the exempt activities of such persons.
[3] HRS § 238-2(1) reads:
Imposition of tax; exemptions. There is hereby levied an excise tax on the use in this State of tangible personal property which is imported, or purchased from an unlicensed seller, for use in this State. The tax imposed by this chapter shall accrue when the property is acquired by the importer or purchaser and becomes subject to the taxing jurisdiction of the State. The rates of the tax hereby imposed and the exemptions thereof are as follows:
(1) If the importer or purchaser is licensed under chapter 237 and is (A) a wholesaler or jobber importing or purchasing for purposes of resale, or (B) a manufacturer importing or purchasing material or commodities which are to be incorporated by the manufacturer into a finished or saleable product (including the container or package in which the product is contained) wherein it will remain in such form as to be perceptible to the senses, and which finished or saleable product is to be sold in such manner as to result in a further tax on the activity of the manufacturer as the manufacturer or as a wholesaler, and not as a retailer, there shall be no tax, provided, that if the wholesaler, jobber, or manufacturer is also engaged in business as a retailer (so classed under chapter 237), paragraph (2) shall apply to him, but the director of taxation shall refund to him, in the manner provided under section 231-23(d) such amount of tax as he shall, to the satisfaction of the director, establish to have been paid by him to the director with respect to property which has been used by him for the purposes stated in this paragraph.
[4] See HRS §§ 237-23, 237-3, 237-22, and 237-24 to 29.
[5] The fact stipulation executed by the parties and presented to the Tax Appeal Court described the transactions in the following manner:
During the initial stages of rehabilitation known as induction, treatment and re-entry, Appellant's residents do not pay any rental for their housing. Appellant receives welfare benefits and food stamps from the Department of Social Services for each resident, and these benefits are paid directly to Appellant to partially cover the costs of rehabilitation, room and board.
[6] The stipulation submitted to the Tax Appeal Court reflects the following facts about this aspect of the case:
The residence facilities also house individuals called gold tags, who continue to participate in Appellant's rehabilitation program, and assist those residents in earlier stages of rehabilitation. However, the gold tags are classified as employees, and receive a salary out of which they pay their own expenses directly, including the cost of their housing in one of Appellant's residence facilities, and Appellant is not entitled to the welfare benefits and food stamps for these residents. Most of the gold tags have poor employment records, and would thus have great difficulty in obtaining employment outside of Appellant's program. While living in these facilities, all residents continue to be bound by Appellant's strict rules and regulations regarding their activities, and continue to participate in Appellant's program of rehabilitation.
c. The rental which each gold tag paid during the years in question was a flat sum which was established merely to help cover the cost to Appellant of operating these residence facilities. This same flat monthly rental is the amount allocated to the housing of those residents in the post re-entry and red tag stages of rehabilitation. No profit was made by Appellant in connection with these rentals... .
[7] The parties have stipulated that the taxpayer's initial application for registration as an exempt organization was filed in 1977 and approved by the State Department of Taxation on September 7, 1977.
[8] A legislative committee report accompanying the measure enacting the use tax stated in relevant part:
The existing compensating tax law imposes a tax on sales of tangible personal property intended for resale in Hawaii by an unlicensed seller, if such transactions have been consummated through the services of a local manufacturer's agent or some other intermediary. The purpose of this tax is to protect our local wholesalers who are assessed a tax of ½ of 1% on their sales by eliminating any unfair competitive advantage a non-licensed seller doing business in Hawaii may have if he escaped taxation. The Administration has pointed out, however, that a substantial volume of sales by unlicensed sellers to local buyers now escape taxation because such sales have been accomplished directly between buyer and seller without the services of an intermediary. Accordingly, it has recommended the repeal of both the consumption and compensating taxes and the enactment of a comprehensive use tax which will cover all transactions and situations presently taxable under the consumption and compensating taxes, as well as taxing the value of goods purchased directly from non-licensed sellers and brought into the State for resale.
Hse.Conf.Comm.Rep. No. 21, in 1965 House Journal 839, 843.
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770 So.2d 492 (2000)
Christine SCOTT, Individually and as Natural Tutrix of the Minors, Kelly Renee Scott and Katie Olivia Scott
v.
Angela H. PYLES, Andy Pyles, Illinois National Insurance Co., Ltd., Farm Bureau Casualty Insurance and Ford Motor Company.
No. 99 CA 1775.
Court of Appeal of Louisiana, First Circuit.
October 25, 2000.
*494 Edward J. Walters, Keith P. Richards, John L. Dugas, Baton Rouge, Counsel for *495 Christine Scott, Individually and as Natural Tutrix of the Minors, Kelly Renee Scott and Katie Olivia Scott.
H. Evans Scobee, Keith C. Armstrong, Henry D. Salassi, Baton Rouge, Counsel for Defendants/Appellants State of Louisiana, Department of Transportation and Development.
Before: LeBLANC, KUHN, and GRANT,[1] JJ.
KUHN, J.
Appellant-defendant, Department of Transportation and Development ("DOTD"), appeals the trial court's judgment finding it thirty percent at fault and awarding damages to plaintiff-appellee, Christine Scott, individually and in her capacity as the confirmed tutrix of her two minor daughters, Kelly and Katie Scott.[2] This suit involves damage claims relative to the personal injuries sustained by Christine Scott and the death of her husband, Mitchell Scott, in an automobile accident. We affirm.
I. FACTUAL AND PROCEDURAL BACKGROUND
On May 2, 1992, Mitchell and Christine Scott attended a function sponsored by Mitchell's employer. After they left the employer-sponsored function, the Scotts joined Christine's sister at Shoney's for dinner. At approximately 1:50 AM, in the early morning hours of May 3rd, under foggy weather conditions, Mitchell Scott, accompanied by Christine, was driving his employer-owned automobile in an easterly direction on Highway 30 in Ascension Parish at or slower than the posted speed limit. When he attempted to cross through the intersection of Highway 30 with Purpera/Hodgeson Roads,[3] a Ford Explorer driven in a southerly direction by Angela Pyles collided into the Scott automobile. Ms. Pyles was intoxicated. As a result of the collision, Mitchell Scott died from the injuries he sustained. Christine Scott survived the automobile accident, although she sustained numerous personal injuries.
Christine Scott filed a petition for damages individually and on behalf of her minor daughters, Kelly and Katie, naming Angela Pyles and her husband, Andrew, as well as DOTD, inter alia, as defendants.[4] On March 16, 1998, the Pyles were dismissed from the lawsuit upon reaching an amicable resolution of plaintiff's claims against them.
*496 A bifurcated trial on the merits was held solely on plaintiff's claims against DOTD. On September 4, 1998, the trial court issued written reasons for judgment concluding Angela Pyles was seventy percent at fault and DOTD was thirty percent at fault for plaintiff's damages. On January 7, 1999, a trial on the merits addressing the quantum of damages was held. By judgment signed on February 8, 1999, the trial court concluded the total damages of plaintiff were $3,485,580.75. DOTD was ordered to pay plaintiff the amount of $1,045,674.23, thirty percent of the total damages. From that judgment, DOTD suspensively appeals. DOTD asserts the trial court erred: (1) in concluding that the failure to install a flashing beacon at the intersection of Highway 30 and Purpera/Hodgeson Roads constituted an unreasonable risk of harm; (2) in finding that DOTD was a cause of plaintiff's harm; and (3) in awarding excessive amounts of damages.
II. DOTD'S LIABILITY
In order to hold DOTD liable for plaintiff's damages under the facts of this case, the trial court concluded that plaintiff sustained her burden of proving that: (1) DOTD had custody of the thing which caused plaintiff's damages; (2) the thing was defective because it had a condition which created an unreasonable risk of harm; (3) DOTD had actual or constructive notice of the defect and failed to take corrective measures within a reasonable time, and (4) the defect was a cause-in-fact of plaintiffs' injuries. Jacobs v. City of Bunkie, 98-2510, pp. 1-2 n. 2 (La.5/18/99), 737 So.2d 14, 17 n. 2; Brown v. Louisiana Indem. Co., 97-1344, p. 3 (La.3/4/98), 707 So.2d 1240, 1242.
Pursuant to La. R.S. 48:21(A), DOTD has a statutory duty to "study, administer, construct, improve, maintain, repair, and regulate" the use of public highways and roads. As such, DOTD has a duty to maintain the public highways in a condition which is reasonably safe, and that duty is owed to persons exercising ordinary care and reasonable prudence. La. R.S. 48:21; Brown, 97-1344 at p. 3, 707 So.2d at 1242. This includes a duty with regard to signs and traffic signals along the road. Lee v. State Through Dep't of Transp. and Dev., 97-0350, p. 4 (La.10/21/97), 701 So.2d 676, 678. DOTD cannot, however, guarantee the safety of all travelers. Id. Nor can it be held responsible for all injuries resulting from any risk posed by the roadway or its appurtenances, only those caused by an unreasonable risk of harm to others. Id.
In Stobart v. State Through Dep't of Transp. and Dev., 617 So.2d 880, 882 (La. 1993), the Louisiana Supreme Court explained the standard of review appellate courts must apply when reviewing the trial court's findings of fact:
A court of appeal may not set aside a trial court's or a jury's finding of fact in the absence of "manifest error" or unless it is "clearly wrong." Rosell v. ESCO, 549 So.2d 840 (La.1989). [The Supreme Court] has announced a two-part test for the reversal of a factfinder's determinations:
(1) The appellate court must find from the record that a reasonable factual basis does not exist for the finding of the trial court, and
(2) the appellate court must further determine that the record establishes that the finding is clearly wrong (manifestly erroneous).
See Mart v. Hill, 505 So.2d 1120 (La.1987).
This test dictates that a reviewing court must do more than simply review the record for some evidence which supports or controverts the trial court's finding. Stobart, 617 So.2d at 882. It must review the record in its entirety to determine whether the trial court's finding was clearly wrong or manifestly erroneous. The issue to be resolved is not whether the trier of fact was right or wrong, but whether the factfinder's conclusion was a reasonable one. Stobart, 617 So.2d at 882. *497 Even though an appellate court may feel our own evaluations and inferences are more reasonable than the factfinder's, reasonable evaluations of credibility and reasonable inferences of fact should not be disturbed upon review where conflict exists in the testimony. Id.
A. Custody
The parties do not dispute that DOTD maintained custody and/or control over the intersection of Purpera/Hodgeson Roads (parish roads) and Highway 30 (a state road).
B. Defect
DOTD focuses its appeal on the trial court's conclusion that the lack of an amber/red light flashing beacon at the intersection of Highway 30 and Purpera/Hodgeson Roads constituted an unreasonable risk of harm, urging that the finding is not supported by the evidence and, therefore, manifestly erroneous.
A vice or defect is some flaw inherent in the thing itself which creates an unreasonable risk of harm to another. Greenlee v. State, ex rel. Dep't of Transp. and Dev., 98-2522, p. 3 (La.App. 1st Cir.2/18/00), 753 So.2d 364, 366. The determination of whether something posed an unreasonable risk of harm is reviewed under the manifest error standard of review. Reed v. Wal-Mart Stores, Inc., 97-1174, p. 5 (La.3/4/98), 708 So.2d 362, 365; Greenlee, 98-2522 at p. 4, 753 So.2d at 366.
In its written reasons, the trial court stated:
The [subservient] Road in this case was Purpera. The trial testimony established that there were a high number of accidents at the intersection. There were enough accidents, according to the DOTD's own interdepartmental standard, to merit the installation of a flashing red beacon. Even after they were urged by the City of Gonzales to install additional traffic controls, the DOTD failed to take action to correct the dangerous condition of the intersection. This Court finds that the lack of a flashing beacon on Purpera Road did constitute an unreasonable risk of harm to prudent drivers....
The evidence presented at trial included testimony by both plaintiff's and DOTD's respective experts, each accepted in the area of highway design and civil engineering, regarding the placement of flashing intersection controls.[5] The experts agreed that with an amber/red light flashing beacon, the flashing amber light was a caution to the motoring public traveling on a favored roadway of a hazardous situation or danger ahead. A flashing red light, according to the collective testimony of the experts, was to advise the motoring public traveling on the subservient roadway to stop and maintain a proper lookout with regard to the favored roadway. Additionally, the testimony of both experts established that, in general, intersectional collisions may be preventable with the installation of flashing beacons; however, the experts disagreed whether the installation of a flashing beacon at the intersection of Purpera and Highway 30 would have prevented the Scott/Pyles accident.
Both experts agreed that according to the Engineering Directives and Standards Manual ("EDSM"), which consists of standards, *498 directives and manuals and is prepared by the State, generally a location should have at least three accidents susceptible of correction by the installation of a flashing beacon in a one-year time period before an intersection control beacon would be installed. Although both experts acknowledged that the same EDSM warrant was tempered by the statement that the indiscriminate use of flashing intersection control beacons should be avoided as such use could reduce the effectiveness to where they are of little or no value, the record contains no evidence indicating where, if any, other amber/red flashing light beacon signals were located along Highway 30 or Purpera/Hodgeson Roads on the day of the Scott/Pyles accident. The experts presented conflicting opinions on whether three accidents susceptible of correction had occurred at that intersection in the years preceding the May 3, 1992 accident.
James R. Clary, Sr., plaintiff's expert, noted that roadways of Purpera and Hodgeson are not directly aligned, with Hodgeson situated somewhat to the east of Purpera Road south of Highway 30. This expert testified that in his opinion three accidents susceptible of correction had occurred on October 11, 1987, November 11, 1987 and March 26, 1988, thereby satisfying the EDSM warrant for the installation of flashing beacons. In the October 11, 1987 accident, the driver traveling north on Purpera, who was cited with driving while intoxicated, stated that he did not see the "STOP" sign. In the other two accidents, the drivers traveling on Purpera were cited with failure to yield, with notations by the respective investigating police officers that each driver had been inattentive or distracted.
Clary opined that the intersection of Highway 30 and Purpera/Hodgeson Roads as it existed on May 3, 1992, was unreasonably dangerous. According to Clary, a flashing red light can be seen from a considerable distance, especially under the foggy weather conditions and at the time of night of the Scott/Pyles accident. Clary explained that a flashing red light is a positive visual cue of danger ahead, which is far more likely to be noticed than the passive "STOP" sign. Plaintiff's expert stated that the blinking amber light serves to put the driver on the favored roadway on notice that he should proceed with caution because there is danger ahead.
DOTD expert, Jack Humphries, opined that the intersection of Highway 30 with Purpera/Hodgeson Roads was not unreasonably dangerous. He disagreed with Clary's conclusion that three accidents susceptible of correction by the installation of a flashing beacon had occurred between October 1987 and March 1988. Humphries testified that because the driver in the November 11, 1987 accident had actually stopped at the "STOP" sign on Purpera Road before entering the intersection, he did not agree with Clary that the accident was one which was susceptible of correction. He acknowledged that a flashing beacon was more likely to catch the attention of a driver than a passive "STOP" sign, but noted that if a driver actually stopped for the "STOP" sign, the purpose of the flashing red light had already been served. It was his opinion that the presence of the flashing amber light for the driver on Highway 30 would not have been of any use, suggesting that at the rate of 50 MPH a cautionary warning would not have prevented the November 11, 1987 accident from occurring.
Humphries explained that the EDSM, upon which Clary relied, was developed to augment the Manual on Uniform Traffic Control Devices ("MUTCD"). According to Humphries, among the provisions of MUTCD is the statement that the decision to use a particular device at a particular location should be made on the basis of an engineering study of the location. The DOTD expert noted that while MUTCD provides standards for design and application of traffic control devices, by its express terms, it is not a substitute for engineering judgment. Humphries testified *499 that it was the express intent of the MUTCD that its provisions be standards for traffic control devices installation, but not a legal requirement for installation.
In addition to the expert testimony, a resolution passed by the City of Gonzales was introduced into evidence. The resolution, signed by Mayor John A. Berthelot on October 23, 1989, requested that DOTD assess dangerous and congested traffic conditions at the intersection of Highway 30 with Purpera/Hodgeson Roads. Mayor Berthelot testified that the request was denied.[6]
Although the experts' testimony conflicted on whether three accidents susceptible to correction by the installation of an amber/red light flashing beacon had occurred within a one-year period, the trial court chose to accept that of plaintiff's expert. While we might have concluded differently had we been the triers of fact in this case, we are mindful that reasonable evaluations of credibility and reasonable inferences of fact should not be disturbed on appellate review where conflict exists in the testimony. Having found a reasonable factual basis exists to support the trial court's finding that the lack of a flashing amber/red light beacon at the intersection of Highway 30 and Purpera/Hodgeson Roads constituted an unreasonable risk of harm, we are constrained under our standard of review to uphold that finding. Accordingly, we cannot say that the factual finding is manifestly erroneous or clearly wrong.
C. Cause in Fact
Cause in fact is generally a "but for" inquiry; if plaintiff probably would not have sustained the injuries but for defendant's substandard conduct, such conduct is a cause in fact. Hutzler v. Cole, 93-0468, p. 9 (La.App. 1st Cir.3/11/94), 633 So.2d 1319, 1325, writ denied, 94-0850 (La.5/13/94), 637 So.2d 1070. In other words, the inquiry is whether defendant contributed to plaintiff's harm. An alternative method for determining cause in fact, which is generally used when multiple causes are present, is the "substantial factor" test. Id. Under this test, cause in fact is found to exist when defendant's conduct was a "substantial factor" in bringing about plaintiff's harm. Id. When multiple causes are alleged, defendant's conduct is a cause in fact when it is a factor in generating plaintiff's harm. Id. The question of whether the defendant's conduct is a cause in fact is a factual inquiry to be determined by the trier of fact. Id.
The parties stipulated that when confronted with the "STOP" sign on Purpera Road, Angela Pyles did not stop as directed. The expert testimony established that the purpose of the flashing red light on a subservient roadway, such as Purpera Road, was to advise the driver to stop and maintain a lookout for traffic on the favored roadway. As noted above, Clary testified that the presence of a flashing red light is a positive visual cue of danger ahead, which is far more likely to be noticed than the passive "STOP" sign. Additionally, DOTD expert Humphries acknowledged that the blinking red light of the amber/red light flashing beacon is designed to more readily capture the attention of a driver than the passive traffic control "STOP" sign. The DOTD expert stated that the active flashing red light device would more probably than not draw the attention of a motorist on the subservient roadway than would a "STOP" sign. Insofar as the flashing amber light for the drivers utilizing the favored roadway, both experts agreed such a warning *500 advises drivers of a hazardous or dangerous situation. Because the evidence establishes nothing other than Mitchell Scott was a prudent and safe driver, we must assume that had he been duly alerted by a flashing amber beacon, he would have heeded the warning and driven in a more cautionary manner. Given the expert evidence, mindful that the City of Gonzales had alerted DOTD of its concern about the safety of the motoring public at this intersection in 1989 and the established fact in this case that Pyles did not stop for the posted "STOP" sign, a reasonable factual basis exists to support the trial court's implicit factual finding that but for the lack of the flashing beacon, plaintiff probably would not have sustained the injuries. Applying the substantial harm test, the trial court's implicit finding that the lack of a flashing beacon for the motoring public at the intersection of Purpera/Hodgeson Roads with Highway 30 was a factor in generating plaintiff's harm is likewise supported with an evidentiary basis and, therefore, not clearly wrong or manifestly erroneous.
DOTD would have us look no further than the negligence of Angela Pyles in causing the accident which resulted in Mitchell Scott's death. The evidence in this record establishes that the intoxicated condition of Angela Pyles as well as the lack of a flashing beacon to alert drivers on both the favored and the subservient roadways combined to cause the harm to plaintiff. See Gibson v. State through Dep't of Transp. and Dev., 95-1418, p. 9 (La.App. 1st Cir.4/4/96), 674 So.2d 996, 1003, writs denied, 96-1862, 96-1895 and 96-1902 (La.10/25/96), 686 So.2d 373, 374. The fact that more than one party can contribute to the harm is the reason for our comparative fault system. Campbell v. Louisiana Dep't of Transp. & Dev., 94-1052, p. 7 (La.1/17/95), 648 So.2d 898, 902.
D. Legal Cause
DOTD strenuously urges that the lack of presence of a flashing beacon at the intersection did not constitute a dangerous condition which would reasonably be expected to cause injury to a prudent person using ordinary care under the circumstances because Angela Pyles was an intoxicated driver at the time of the accident. We construe this assertion by DOTD to challenge the trial court's implicit conclusion that the lack of a flashing beacon at the intersection of Highway 30 and Purpera/Hodgeson Roads on the day of the Scott/Pyles accident was a legal cause of plaintiff's harm.
Legal cause is synonymous with defendant's breach of a duty that extends to protect plaintiff from the type and manner of harm of which she complains. Jones v. Johnson, 572 So.2d 150, 156, n. 10 (La.App. 1st Cir.1990), writs denied, 576 So.2d 519 (La.1991). Whereas the question of cause in fact involves a factual determination, the determination of legal cause is a purely legal question. Todd v. State, Dep't of Social Services, Office of Community Services, 96-3090, p. 6 (La.9/9/97), 699 So.2d 35, 39. The legal cause or scope of duty inquiry is fact sensitive and ultimately turns on a question of policy as to whether a particular risk falls within the scope of the duty. Roberts v. Benoit, 605 So.2d 1032, 1044 (La.1991). To find DOTD liable for an unreasonable risk of harm, the imperfection or irregularity in the thing must be of such a nature as to constitute a dangerous condition which would reasonably be expected to cause injury to a prudent person using ordinary care under the circumstances. See Netecke v. State ex rel. DOTD, 98-1182, p. 8 (La.10/19/99), 747 So.2d 489, 495. Whether DOTD breached its duty to the motoring public, by knowingly maintaining a defective or unreasonably dangerous roadway, depends on the facts and circumstances of the case. Lee, 97-0350 at p. 4, 701 So.2d at 678.
One may agree with DOTD that its duty to maintain the public highways in a safe condition does not require it to ensure an *501 intoxicated driver stop at a "STOP" sign.[7] However, in this case, the trial court found as a matter of fact that the lack of a flashing beacon created an unreasonable risk of harm. Both experts testified and agreed that the EDSM used by DOTD discussed installation of a flashing beacon once three accidents occurred which would have been preventable had the beacon existed at an intersection. Insofar as causation may be at issue, the testimony of both experts should be construed as a positive statement that intersectional collisions may be preventable with the installation of flashing beacons. Given these facts, it is clear to us that it is to the prudent motoring public using ordinary care as they traveled along Highway 30 that DOTD owed a duty to install a flashing beacon at the intersection. Mitchell Scott, whom the record establishes was a prudent driver exercising ordinary care in the early morning hours of May 3rd and completely free from fault, was such a driver, and DOTD's duty to maintain Highway 30 in a safe condition clearly extended to him.
The facts under review show the City of Gonzales requested that traffic controls be installed at the intersection citing "dangerous and congested traffic conditions," approximately three years before Mitchell Scott's death. In addition, that there is no evidence of the number of flashing beacons along either Highway 30 and/or Purpera/Hodgeson Roads, so as to demonstrate indiscriminate use of this type of intersectional traffic control, convinces us that the duty DOTD owed the motoring public to maintain the state's highways in a safe condition extended to this plaintiff. DOTD's duty to install a flashing beacon at an intersection as specified in the EDSM was one which was owed to Mitchell and Christine Scott, and DOTD is not relieved from that duty simply because the driver utilizing the subservient roadway was intoxicated. We note there is no evidence in the record, save speculation, that alcohol consumption prevented Pyle from stopping at the "STOP" sign.
The presence of a flashing amber light for Highway 30 would have heightened Mitchell Scott's awareness of the potential danger the intersection with Purpera/Hodgeson Roads held and, perhaps, caused him to drive in a manner which would have allowed him to advert the collision with the Pyles vehicle. More importantly, DOTD's duty to maintain the public highways in a safe condition included the real risk that drivers would not stop at the "STOP" sign posted on Purpera Road. We find no error in the trial court's implicit conclusion that the unreasonable risk of harm created by the lack of a flashing beacon extended to this plaintiff.
Because DOTD does not challenge the trial court's allocation of thirty percent fault to it,[8] and having found no error in the conclusion that DOTD is liable in part to plaintiff for her damages, we turn now to the contentions relative to the awards of damages.
III. QUANTUM OF DAMAGES
The trier of fact is given much discretion in the assessment of damages. La. C.C. art. 2324.1. Upon appellate review, damage awards will be disturbed *502 only when there has been a clear abuse of that discretion. Theriot v. Allstate Ins. Co., 625 So.2d 1337, 1340 (La.1993). The initial inquiry must always be directed at whether the trial court's award for the particular injuries and their effects upon this particular injured person is a clear abuse of the trier of fact's much discretion. Reck v. Stevens, 373 So.2d 498, 501 (La. 1979). In reviewing quantum, if the award constitutes an abusive of discretion, it is not disregarded, but rather is reduced to the highest amount or raised to the lowest amount within the reasonable range of discretion. Powell v. Regional Transit Authority, 96-0715, p. 10 n. 10 (La.6/18/97), 695 So.2d 1326, 1332 n. 10.
A. General Damages
In Youn v. Maritime Overseas Corp., 623 So.2d 1257, 1261 (La.1993), cert. denied, 510 U.S. 1114, 114 S.Ct. 1059, 127 L.Ed.2d 379 (1994), the Louisiana Supreme Court noted:
[T]he discretion vested in the trier of fact is "great," and even vast, so that an appellate court should rarely disturb an award of general damages. Reasonable persons frequently disagree about the measure of general damages in a particular case. It is only when the award is, in either direction, beyond that which a reasonable trier of fact could assess for the effects of the particular injury to the particular plaintiff under the particular circumstances that the appellate court should increase or reduce the award.
Without contending that the record lacks a reasonable factual basis to support the trial court's award of general damages to Christine Scott, DOTD simply urges that the amount awarded was too much and, as such, constituted an abuse of discretion. The trial court awarded Christine total general damages in the amount of $600,000.00, specifying that $150,000.00 were attributable to her facial disfigurement and $450,000.00 were for the remainder of her general damages.
"General damages" involve mental or physical pain or suffering, inconvenience, loss of gratification or intellectual or physical enjoyment, or other losses of lifestyle which cannot be measured definitively in terms of money. Boudreaux v. Farmer, 604 So.2d 641, 654 (La.App. 1st Cir.), writs denied, 605 So.2d 1373, 1374 (La.1992). The primary objective of general damages is to restore the party in as near a fashion as possible to the state he was in at the time immediately preceding injury. Daigle v. U.S. Fidelity and Guar. Ins. Co., 94-0304, p. 7 (La.App. 1st Cir.5/5/95), 655 So.2d 431, 437. The factors to be considered in assessing quantum for pain and suffering are severity and duration. Thibodeaux v. USAA Cas. Ins. Co., 93-2238, p. 8 (La.App. 1st Cir.11/10/94), 647 So.2d 351, 357.
In its written reasons for judgment, the trial court stated:
Mrs. Scott's mandible was fractured. She suffered facial lacerations, and multiple [intra-oral] lacerations as well. She sustained lacerations to the upper lid, nasal labial fold, upper and lower left eyelid, and the scalp. In addition to her facial injuries, she suffered contusions and lacerations to her legs and thighs, elbow and arms. Her wounds were surgically debrided ... and sutured. A plate was put in her jaw and her jaws were wired together. She was only able to eat liquids ... via syringe. She also required extensive dental work to repair damaged teeth.
The dental work entailed, among other things, the placement of two teeth implants in the lower left side of her mouth. She required several root canals as a result of the trauma sustained to her teeth in the accident and required placement of six crowns for her teeth and the implants.
Christine Scott was temporarily blind after the accident. Although her vision was subsequently restored, she continued to have difficulty with dry eye due to scar tissue development in her lower left eyelid *503 for several years post-accident. One week after her initial discharge from the hospital, Christine returned with severe back pain and an inability to urinate. She was diagnosed with a bladder spasm and back pain attributable to lumbar contusions she sustained in the accident.
Christine Scott testified that she was in excruciating pain as a result of her injuries, especially in her jaw. She found the physical therapy she underwent to assist her in opening her mouth to be overwhelmingly painful. Bruises covered her body from head to toe. She testified that due to an injury on her leg, she was unable to walk. Family and neighborhood friends assisted her in round the clock shifts. Due to her injuries, her doctors concluded it was best if she did not attend Mitchell's funeral, which caused her enormous guilt. Each of her doctors and dentists described the enormous pain Christine endured as a result of both her injuries and the subsequent treatment for those injuries. Christine suffered from frequent and intense headaches, continuing through the date of trial. Additionally, she became depressed and was treated by a psychiatrist.
In light of the injuries Christine Scott suffered from, and mindful of the inferences of pain and suffering the trial court made, we find no abuse in the trial court's award of $450,000.00 in general damages for all injuries, except the permanent disfigurement. For the permanent facial scarring Christine has, the trial court made a separate award of $150,000.00. DOTD does not assert any specific contentions with this award, instead maintaining the total award of $600,000.00 is an abuse of discretion.
Christine was treated by plastic surgeon, Dr. Ann Reilley, on the day of the accident. Dr. Reilley cleaned up the facial wounds, removing glass from the cheek, and suturing lacerations to the eyelid and cheek. Christine sustained a bad injury on the left side of her lip, from which tissue had to be excised. She has severe scarring due to the absence of skin and a tendency for hypertrophic scarring. Dr. Reilley explained that a hypertonic scar is a thick or raised one; it is unsightly and more noticeable. Christine was referred to a makeup artist to learn some techniques to camouflage the scars on her cheek and lip. Due to under-pigmentation in the healing process, areas where the skin is lighter than her normal skin color, Christine was tattooed to create a more even colored appearance. According to the expert plastic surgeon, the process is an injection of color into the skin which is the same process performed to create ordinary tattoos.
The main cosmetic concern Christine was worried with was the tightness of her upper left lip. Dr. Reilley testified that it was caused because of a lack of skin and missing tissue. Lip reconstruction was undertaken, where tissue was removed from near the center of Christine's bottom lip and placed into her top lip. Because the flap was too bulky, several revisional surgeries, consisting of direct excisions of the tissue and skin of the upper lip, were performed. Nevertheless, Christine has notable scarring on both her left cheek and the left side of her upper lip. Dr. Reilley indicated that Christine lost some of the normal anatomical landmarks on her lip. The normal part of the cupid's bow on the left side and the normal-like nasal labial-type fold were lost. The obvious thing, according to Dr. Reilley, is that there is just too much upper lip; the distance between the nose and the corner of the mouth is notably damaged.
Although Dr. Reilley addressed her treatment of the physiological damage to Christine's face, she also noted that Christine was terribly self-conscious about her lip. Christine indicated to her that every time she looked in the mirror, it was very painful. This sentiment was evident in Christine's testimony regarding the appearance of her face. She described her face as ugly. According to Dr. Reilley, Christine was reminded of the accident and of the loss of her husband every time *504 she saw herself. She felt uncomfortable about meeting new people or being around other people. Dr. Reilley testified that more than anything, Christine just wanted to be restored to her pre-injury condition. Dr. Reilley could not achieve that for her patient.
Whether we consider the trial court's itemized awards of $150,000.00 for the permanent facial scarring of Christine Scott and $450,000 .00 for all other general damages individually, or simply the total award of $600,000.00 in general damages, there is no abuse of the trial court's much discretion under the facts of this case.
B. Wrongful Death Claims
The elements of damage for a wrongful death action are loss of love, affection, companionship, and support and funeral expenses. Gibson, 95-1418 at p. 14, 674 So.2d at 1006.
1. Christine Scott
The trial court awarded Christine Scott $750,000.00 for the wrongful death of her husband. DOTD contends the award is abusively high.
In addition to Christine's testimony, that of her daughters, Kelly and Katie, established Christine and Mitchell had a close and loving relationship. Collectively, they characterized the Scott marriage as a very good one. Christine was dependent upon her husband, both financially and emotionally. She described her husband as a family man, who maintained a busy schedule, but nevertheless was involved in the details of their family life. According to Christine, she did not want to live after she learned of her husband's death, and even the knowledge of her daughters' need for a mother did not matter to her.
After referral from a grief counselor, Christine began a three-year treatment for depression with a psychiatrist. Dr. Navin Patel, who treated Christine's depression, testified that the nature of the events, guilt she was consumed with (reasoning that if she had not convinced her husband to attend the employer-sponsored event the evening of his death, he would somehow still be alive) and the surgeries for her facial injuries caused Christine to constantly re-live the trauma of the accident. Dr. Patel explained that having lost a spouse that she was very close to and dependent upon, coupled with the facial disfigurement, made Christine's experience traumatic for her.
Although he did not characterize her as suicidal, Dr. Patel saw a despondency in Christine that concerned him. She was unable to participate and cope in her role as a single parent. In addition to a voluntary commitment to an inpatient grief program at Our Lady of the Lake Hospital, Christine participated in an outpatient program for grief counseling through the hospital. Subsequent to her hospital care, and having been prescribed Prozac, Christine began to make progress. Her relationships with her children improved. Dr. Patel, who sold his practice toward the end of Christine's treatment, believed that she was well on her road to recovery.
While the record establishes that Christine grieved deeply after losing her husband, she was also very emotionally effected by her own injuries, especially the disfigurement to her face. We find the trial court abused its discretion in awarding Christine Scott $750,000.00 for the wrongful death of Mitchell Scott. Reducing the wrongful death award in favor of Christine to the highest amount a reasonable trier of fact can award in light of the evidence in this case, we conclude the amount of $500,000.00 is an appropriate award. Accordingly, we amend the trial court's judgment from $750,000.00 to $500,000.00 for Christine's wrongful death damages.
2. Kelly and Katie Scott
The trial court awarded each of the Scott daughters wrongful death damages. Kelly was awarded $750,000.00 and Katie's award was $500,000.00.
*505 Under Louisiana law, amounts recoverable in a wrongful death action for loss of care, guidance, and affection of the deceased may differ among the plaintiffs on the basis of differing degrees of affection which existed between the deceased and the different plaintiffs or differing degrees of guidance needed by minor plaintiffs. Archie v. Board of Sup'rs of Louisiana State University, 543 So.2d 1348, 1353 (La.App. 1st Cir.1989).
Both Kelly and Katie Scott testified. Kelly was 13 and Katie was 10 on the day of the accident. According to both daughters, Kelly was very close to her father. Mitchell had sponsored her baseball team at school. He attended club functions and events in which she was involved. Both Scott daughters noted the special bond between Kelly and her father, describing her as a "daddy's girl." Kelly stated that after her father's death, everything was different. Besides the effect on her mother and her withdrawal from their family's life, Kelly grieved her own loss.
While the Scott sisters acknowledged that Katie's relationship with their father was not as close as Kelly's, due in part to her younger age, the impact of the loss was nevertheless devastating to the ten year old. Despite her young years at the time of her father's death, Katie recalled that Mitchell attended activities involving her, taking a "ton of pictures" of her. Katie testified that she missed her father and his absence was especially apparent to her at dance competitions. She stated that seeing other dancers with their fathers present, obviously proud of their daughters, made her wish her father were there.
In light of the evidence in this record, we find the trial court's awards to each of the Scott sisters for the wrongful death of their father is a clear abuse of its discretion. Reducing the awards to the highest amounts within the reasonable range of discretion, we conclude $500,000.00 is the most a reasonable trier of fact can assess to Kelly Scott for the wrongful death of her father. We find the amount of $400,000.00 is the most a reasonable trier of fact can assess to Kelly Scott under the facts established in this case. Accordingly, the trial court's judgment is amended from $750,000.00 to $500,000.00 for Kelly Scott's wrongful death damages and from $500,000.00 to $400,000.00 for Kellie Scott's wrongful death damages.
C. Loss of Consortium
The trial court awarded each of Christine and Mitchell's daughters $100,000.00 for the loss of consortium damages each suffered as a result of their mother's injuries.
An award for loss of consortium is properly made where there has been some measurable or compensable loss, such as loss of love and affection, society and companionship, sexual relations, right of performance of material services, right of support, aid and assistance, and felicity. Haley v. McManus, 593 So.2d 1339, 1344 (La.App. 1st Cir.1991). The elements of a minor child's claim for loss of service and society are essentially the same without, of course, the sexual component. Higley v. Kramer, 581 So.2d 273, 282 (La. App. 1st Cir.), writ denied, 583 So.2d 483 (La.1991).
The collective testimony of the Scott daughters established that Kelly assumed many adult responsibilities, especially in the care of Katie. Katie said of her older sister, "I know she took care of me...she was only 13 or 14, and she did a lot for me. She was the one that was there for me." Christine, Kelly, Katie and Dr. Patel all agreed that for a long time, Christine wanted nothing to do with her daughters. Christine rationalized her unavailability with the thought that her sister would tend to the girls. Katie testified candidly that she was very angry with her mother for the neglect brought about by Christine's emotional reaction to Mitchell's death. Katie was in counseling at the time of trial attempting to deal with her anger *506 at her mother's emotional abandonment. The younger Scott daughter noted that she did not feel that she could discuss her problems with her mother because of her mother's intense emotional response to the loss of Mitchell. In light of the loss of their mother's love and affection, endured simultaneously with the grief they felt with the loss of their father, we cannot say that awards of $100,000.00 to each is an abuse of discretion especially given the emotional unavailability of their mother during their formative and teenage years.
D. Loss of Financial Support
The trial court awarded plaintiff $808,206.50 for loss of past and future financial support from Mitchell Scott. On appeal, DOTD urges that the trial court abused its discretion by "blindly accepting" the numbers of plaintiff's economist over those of DOTD's economist.
The report of G. Randolph Rice, Ph.D. was submitted by plaintiffs. Rice noted that Mitchell Scott was born on August 26, 1955. Applying recent data from the Bureau of Labor Statistics, U.S. Department of Labor, Rice indicated that had the accident not occurred, Mitchell's future work-life expectancy from the date of trial was 18.7 years. Calculating Mitchell's past lost earnings based on his annual salary of $48,525.00, which included an amount for a $5,000.00 annual bonus that Mitchell received in 1992, Rice opined the past loss of support to the Scott family was $323,057.00. Using the same salary base, applying a 3.0 percent annual growth factor to reflect inflationary pressures, and a discount rate of 5.25 percent to offset that the Scott family would presently receive earnings Mitchell would not have earned until a future date, Rice concluded the present value of Mitchell's future earnings was $721,347.00. Thus, the combined total of the loss of support as calculated by Rice was $1,044,404.00. Rice used this total figure and adjusted it downward to reflect the personal consumption expenditures of Mitchell Scott arriving at a final amount of $886,413.00.
The report of Kenneth Boudreaux, Ph.D. was submitted by DOTD. Boudreaux used the same data base (U.S. Department of Labor, Bureau of Labor Statistics) as Rice but determined that Mitchell's life expectancy was 17.15 years from the date of trial. Utilizing the same annual salary of $48,525.00, applying annual growth factors ranging between 2.0 and 4.0 percent, discounting for present use by factors ranging from 4.35 to 5.0 percent, Boudreaux suggested the amount of $439,435.55 reflected the pre-tax future loss of support for Mitchell's spouse and his children through the age of 18. He indicated the amount of $448,959.06 reflected the pre-tax future loss of support for Mitchell's spouse and children through the age of 21. He additionally calculated the amounts of $236,482.93 and $248,725.86 as the pre-tax past loss of support for Mitchell's spouse and children, with the lesser amount reflecting the children through age 18, and the greater amount showing the children through age 21. Thus, Boudreaux opined that the total loss of support award to plaintiff was either $675,936.48 or $697,684.92, varying with the age of the children.
Based on this evidence, we cannot say the trial court's award of $808,206.50, falling between the conclusions of the economists, is an abuse of discretion.
IV. CONCLUSION
For the reasons stated, the trial court's judgment awarding total damages in the amount of $3,485,580.75 is amended to total damages in the amount of $2,885,580.75, reflecting the reduction from $750,000.00 to $500,000.00 for Christine, from $750,000.00 to $500,000.00 for Kellie and from $500,000.00 to $400,000.00 for their respective wrongful death damages. DOTD is therefore ordered to pay plaintiff the total amount of $952,241.88, reflecting the thirty percent allocation of fault attributable to DOTD. In all other *507 respects the judgment is affirmed. Costs of this appeal in the amount of $5,504.23 are assessed against the Department of Transportation and Development.
AFFIRMED AS AMENDED.
LeBLANC, J., concurs in part, dissents in part, and assigns reasons.
LeBLANC, J., Concurring in Part and Dissenting in Part.
After careful consideration of the record in this matter, I concur with the majority's opinion concerning the award of damages. However, I disagree with the percentage of fault allocated to DOTD. I find the issue sufficiently raised and properly before this court by virtue of DOTD's assignment of error raising the issue of causation. The issue of finding any fault encompasses the issue of finding some percentage of fault.
DOTD has a responsibility to consider the actions of inattentive or negligent drivers when making determinations about roadway safety. See Brown v. Louisiana Indemnity Company, 97-1344 (La.3/4/98), 707 So.2d 1240. The intersection in question was not equipped with a flashing beacon, which would have alerted Scott to proceed with caution because of the upcoming intersection. By comparison, we have a drunk driver failing to stop when confronted with a clearly marked "STOP" sign. Therefore, I would allocate to DOTD ten percent fault and ninety percent fault to Pyles.
Accordingly, I concur in part and dissent in part.
NOTES
[1] Judge Jo Ellen Grant of the 24th Judicial District Court is serving as judge pro tempore by special appointment of the Louisiana Supreme Court.
[2] Although at the time the petition for damages was filed, the daughters of Christine Scott were minors, by the date of the trial on the merits, Kelly had obtained the age of majority. The record fails to establish that Kelly Scott was substituted as plaintiff upon reaching the age of majority, however, the parties do not raise any contentions with Kelly's status on appeal.
[3] The evidence established that north of Highway 30, the Ascension Parish roadway is named Purpera Road and to the south, it is named Hodgeson Lane. Purpera Road is also known as Painter Road, and at times is referred to as an avenue and a lane. In conformity with the trial court's reference in its written reasons as well as the parties' references in the pleadings, we refer to this roadway as "Purpera Road." Hodgeson Lane is also referred to as Hodgenson Lane at times in this record. For brevity, we refer to this roadway as "Purpera/Hodgeson Roads."
[4] On April 23, 1993, Christine Scott filed her first supplemental and amending petition for damages, replacing in its entirety an earlier petition, and naming DOTD as a defendant for the first time. In her later-filed pleading, in addition to the Pyles, Scott also named as defendants the Ford Motor Company, as the manufacturer of the Pyles vehicle, Illinois National Insurance Company, the insurer of the Pyles vehicle, and Louisiana Farm Bureau Casualty Insurance Company, the Scotts' uninsured/underinsured motorist insurer. Ford Motor Company was dismissed from the lawsuit after amicable resolution of the claims against it. Subsequent to its tender of its policy limits and court costs, Illinois National Insurance Company was released from this lawsuit. Louisiana Farm Bureau was dismissed by motion for summary judgment. The record also establishes that plaintiff settled a claim with Mitchell Scott's employer.
[5] Since the parties stipulated to the expertise of both Clary and Humphries, a formal hearing challenging the expertise of either witness's testimony to demonstrate a lack of a valid scientific connection to the pertinent inquiry, see Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579, 591-92, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993), was neither requested nor conducted. See also Kumho Tire Co., Ltd. v. Carmichael, 526 U.S. 137, 119 S.Ct. 1167, 1171, 143 L.Ed.2d 238 (1999) (holding that Daubert's general "gatekeeping" obligation "applies not only to testimony based on `scientific' knowledge, but also to testimony based on `technical' and `other specialized' knowledge.") In light of the stipulation, the record lacks any evidence of the nature suggested in Daubert and its progeny, and we must therefore accept that the expertise of both these witnesses duly establishes the requisite valid scientific connection to the pertinent inquiry.
[6] Apparently, DOTD undertook a study which resulted in a conclusion that the intersection did not meet the congestion standards of the EDSM and, finding that very few accidents had occurred at that intersection, DOTD declined to install a flashing beacon signal as requested by the City of Gonzales. The record fails to establish, however, what, if any, engineering judgment was applied by DOTD relative to the EDSM warrant for installation of a flashing beacon based on three accidents susceptible to correction. Nor does the record establish that the warrant relative to congestion standards is of higher engineering priority than the warrant addressing installation of a flashing beacon.
[7] We note, though do not find dispositive, that the evidence in this record shows between 1987 and 1992, at least three collisions involving intoxicated motorists traveling on Purpera Road had occurred at this intersection with Highway 30. The Scott/Pyles accident was the fourth one.
[8] While DOTD requests in brief that this court adjust fault to find Angela Pyles ninety percent at fault and DOTD ten percent at fault, it neither assigned error to nor presented argument on the trial court's allocation of fault. The issue of fault allocation is not properly before us, see La. Uniform Rules-Courts of Appeal, Rule 2-12.4, however, we nevertheless note that based on the evidence in this record, the trial court's quantification of fault in this matter is not manifestly erroneous. See Gibson v. State, through Dep't of Transp. and Dev., 95-1418, p. 9 (La.App. 1st Cir.4/4/96), 674 So.2d 996, 1004, writs denied, 96-1862, 96-1895, and 96-1902 (La.10/25/96), 681 So.2d 373 and 374.
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574 S.W.2d 73 (1978)
Johnny DAVENPORT, Appellant,
v.
The STATE of Texas, Appellee.
No. 56013.
Court of Criminal Appeals of Texas, En Banc.
November 15, 1978.
Rehearing Denied December 20, 1978.
*74 John Langford, El Paso, for appellant.
Steve W. Simmons, Dist. Atty. and Douglas Gelo, Asst. Dist. Atty., El Paso, Jim D. Vollers, State's Atty., Austin, for the State.
Before the court en banc.
OPINION
ODOM, Judge.
This is an appeal from an order revoking probation. On January 19, 1971, appellant pled guilty to the offense of possession of a narcotic drug and his punishment was assessed at six years in the Texas Department of Corrections. Imposition of sentence was suspended and probation was granted, subject to certain terms and conditions. Among the conditions of appellant's probation were that he commit no offense against the law, that he avoid injurious or vicious habits, and that he drink no alcoholic beverages and enter no place where such beverages are sold.
On September 3, 1976, the State filed a motion to revoke adult probation alleging:
"[O]n the thirteenth day of August, 1976, in the County of El Paso and State of Texas, the said defendant, Johnny Davenport, did then and there unlawfully, intentionally and knowingly drive and operate a motor vehicle, to-wit: 1970 Ford Pinto upon a public road and highway in said State and County, while the said Johnny Davenport was intoxicated and under the influence of intoxicating liquor."
A hearing was held on October 21, 1976, and the trial court denied the State's motion to revoke. Subsequent thereto, on November 1, 1976, the State filed another motion to revoke adult probation alleging as grounds the same factual basis that was alleged in the September 3 motion.[1]
On December 22, 1976, after having heard the second motion, the court found the State's allegations true and revoked appellant's probation.
Double Jeopardy Issue
The first contention presented by the appellant is that Article I, Sec. 14, of *75 the Texas Constitution, and the United States Constitution's Fifth Amendment guarantee against double jeopardy applicable to the states through the Due Process Clause of the Fourteenth Amendment prohibit the State from twice subjecting the appellant to a revocation of probation proceeding based upon the same alleged probationary violation and fact situation.[2]
At a revocation of probation proceeding, a defendant need not be afforded the full range of constitutional and statutory protections available at a criminal trial. Gagnon v. Scarpelli, 411 U.S. 778, 93 S.Ct. 1756, 36 L.Ed.2d 656 (1973). At such a proceeding, guilt or innocence is not at issue, and the trial court is not concerned with determining the defendant's original criminal culpability. "The question at a revocation hearing is whether the appellant broke the contract he made with the court after the determination of his guilt." Kelly v. State, Tex.Cr.App., 483 S.W.2d 467, 469. Also of significance is the fact that "... the result of such a hearing to revoke is not a conviction but a finding upon which the trial court might exercise its discretion by revoking or continuing probation." Hill v. State, Tex.Cr.App., 480 S.W.2d 200, cert. denied, 409 U.S. 1078, 93 S.Ct. 694, 34 L.Ed.2d 667 (emphasis added.) "A probation revocation hearing is not ... a criminal prosecution." Hill v. State, supra. It has been denominated as "administrative in nature." Hill v. State, supra.
In interpreting the Double Jeopardy Clause embodied in Art. I, Sec. 14, Tex. Const.,[3] this Court held in Johnson v. State, 73 Tex.Cr.R. 133, 164 S.W. 833, "A person is in legal jeopardy when he is put upon trial, before a court of competent jurisdiction, upon an indictment or information .. sufficient in form and substance to sustain a conviction, and a jury has been ... impaneled and sworn to try the case," at 834. See Thompson v. State, Tex.Cr.App., 527 S.W.2d 888. We are thus constrained to hold that the double jeopardy protections of both the Texas and Federal Constitutions do not apply to a proceeding wherein the result is deemed to be neither a conviction nor acquittal, see Barber v. State, Tex.Cr. App., 486 S.W.2d 352; a proceeding that is not considered to be a trial, "as that term is used and contemplated by the Constitution in reference to criminal cases ...," Wilson v. State, 156 Tex.Cr.R. 228, 240 S.W.2d 774, 776; Campbell v. State, Tex.Cr. App., 456 S.W.2d 918; a proceeding which is not considered to be a criminal prosecution, Hill v. State, supra, and is considered to be only "administrative in nature." Hill v. State, supra.
In Bass v. State, Tex.Cr.App., 501 S.W.2d 643, cert. denied 415 U.S. 977, 94 S.Ct. 1563, 39 L.Ed.2d 873, we rejected the defendant's contention that the revocation of his probation based "on the same evidence heard by the same court in denying a prior motion to revoke" violated double jeopardy protection. In that case, the testimony adduced at the first hearing was introduced again at a subsequent hearing to revoke, along with the information, judgment, sentence and mandate of affirmance of a conviction for misdemeanor embezzlement. The same offense was the subject of both of the State's motions to revoke probation. In finding no double jeopardy violations, we cited Settles v. State, Tex.Cr.App., 403 S.W.2d 417, and held, "The allegation in a motion to revoke probation that probationer has committed a particular offense when the motion is heard by the court does not constitute jeopardy and will not bar a subsequent prosecution for such offense." Bass, at 644.
In Breed v. Jones, 421 U.S. 519, 95 S.Ct. 1779, 44 L.Ed.2d 346 (1975), the Supreme Court held, "[T]he risk to which the [Double Jeopardy] Clause refers is not present in proceedings that are not essentially criminal." Id., at 528, 95 S.Ct. at 1785.
*76 In light of the nature of the probation revocation proceeding, we hold that the double jeopardy protection of the Texas and United States Constitutions is not applicable.
Res Judicata Issue
The appellant next contends that the trial court abused its discretion in refusing to dismiss the State's second motion to revoke probation because the prosecution of the second motion was barred by the doctrine of res judicata. Appellant contends that the doctrine of res judicata applies even where a plea of double jeopardy would not lie, and further argues that public policy considerations would be violated if the State were allowed to relitigate after it has been once litigated and the issues finally disposed of.
"[R]es judicata is the doctrine that an existing final judgment or decree, rendered on the merits, without fraud or collusion, by a court of competent jurisdiction, on a matter within its jurisdiction is conclusive of the rights of the parties or their privies in all other actions or suits in the same court, or in any other judicial tribunal of concurrent jurisdiction, on points and matters in issue in the first suit." Goldberg v. Goldberg, 425 S.W.2d 830, 831 (Tex.Civ.App., Ft. Worth 1968, no writ history). See also McGuire v. Commercial Union Insurance Co., 431 S.W.2d 347 (Tex.Sup.1968). Parr v. Parr, 543 S.W.2d 433 (Tex.Civ.App., Corpus Christi, 1976, no writ history).
It has also been held, however, that res judicata does not apply to administrative decision-making. See Bryant v. L. H. Moore Canning Co., 509 S.W.2d 432 (Tex. Civ.App.Corpus Christi, 1974), cert. denied 419 U.S. 945, 95 S.Ct. 79, 42 L.Ed.2d 74; Railroad Commission v. Phillips, 364 S.W.2d 408 (Tex.Civ.App.Austin, 1963); Killingsworth v. Broyles, 300 S.W.2d 164 (Tex.Civ.App.Austin, 1957).
In Hill v. State, supra, it was held that a probation revocation hearing is administrative in nature. Under Texas statutory law, this nature of the proceeding is apparent. Article 42.12, V.A.C.C.P., is the Adult Probation Law. In the opening sentence of the first section of that Act it is stated:
"It is the purpose of this Article to place wholly within the State courts of appropriate jurisdiction the responsibility for determining when the imposition of sentence in certain cases shall be suspended, the conditions of probation, and the supervision of probationers, in consonance with the powers assigned to the judicial branch of this government by the Constitution of Texas."
The administrative supervision of the probationer by the court is also stated in Sec. 3 of the Act:
"Any such person placed on probation, whether in a trial by jury or before the court, shall be under the supervision of such court."
We hold the supervision of probationers is an administrative function of the courts and not a judicial function, and that the revocation hearing and the decision to revoke probation or not is administrative in nature. We therefore hold that the doctrine of res judicata does not apply. See and cf. Bass v. State, supra; Wester v. State, Tex.Cr.App., 542 S.W.2d 403; Sappington v. State, Tex.Cr.App., 508 S.W.2d 840; Traylor v. State, Tex.Cr.App., 561 S.W.2d 492. The contention is overruled.
In his last contention appellant argues the evidence is insufficient to show he was intoxicated as alleged in the motion to revoke. Officer Lisowski, the arresting officer, testified that he stopped appellant because the car he was driving was moving at a rapid speed and almost collided with two cars as it made a right hand turn. When appellant stepped from the car he was very unsure of his footing and almost fell. During his conversation with the officer he came very close, and had a moderate odor of alcoholic beverage at two inches distance. The officer stated that in his opinion appellant had been drinking alcoholic beverages and was intoxicated. He also testified that a person may have only a moderate odor of alcohol and still be intoxicated. The contention is without merit.
*77 We find no abuse of discretion and affirm the order revoking probation.
PHILLIPS, Judge, dissenting.
The majority concludes that the State's successful second effort to revoke appellant's probation based on the same alleged offense committed by the probationer while on probation does not violate the double jeopardy clauses of the Texas and United States Constitutions. See U. S. Constitution, Fifth Amendment; Texas Constitution, Article I, Section 14. They also conclude that the collateral civil doctrine of res judicata does not apply to appellant's situation.
I.
With respect to the majority's disposition of the first issue, heavy concentration is placed upon previous characterizations of the revocation of probation proceeding. It has variously been interpreted as a remedy for a contractual breach by the probationer or as an administrative proceeding in nature. Majority opinion, infra at 75; Kelly v. State, Tex.Cr.App., 483 S.W.2d 467, 469; Hill v. State, Tex.Cr.App., 480 S.W.2d 200. Reliance is also had on the authority of Bass v. State, Tex.Cr.App., 501 S.W.2d 643, a case that can be considered "on all fours." Nevertheless, as will be explained below, I believe the authority of Bass v. State, supra, and the majority's disposition of appellant's ground of error are in error.
The first order of analysis under a claim of a double jeopardy violation is to eschew those labels that serve to obfuscate more than clarify. This is clearly the teaching of Breed v. Jones, 421 U.S. 519, 95 S.Ct. 1779, 44 L.Ed.2d 346 (1975). The Court in Breed was concerned with the question of whether an adjudicatory proceeding against a juvenile under the California Welfare and Institutions Code in which testimony was adduced before the juvenile court concerning the facts of the offense allegedly committed by the alleged juvenile delinquent constituted jeopardy insofar as it would operate as a bar against any subsequent prosecution of the juvenile as an adult. In Breed, after the required adjudicatory hearing, the juvenile was found to be delinquent as defined under the California Welfare and Institutions Code, but not amenable to the rehabilitation programs available for juvenile offenders. The juvenile was then transferred to the adult system for prosecution as an adult felon. Of significance to the conclusion that the same doctrine should apply to this State's revocation of probation proceedings is the fact that under Section 701 of the California Welfare and Institutions Code the adjudicatory hearing is conducted before the court, without a jury, and the burden of proof shouldered by the State in establishing that the juvenile is delinquent is a preponderance of the evidence. The same burden of proof applies in this State's probation revocation proceedings. Scamardo v. State, 517 S.W.2d 293. Furthermore, when the basis for the State's motion to revoke a probation is based upon the alleged commission of an offense against the laws of this State, the State is required to prove each element of the offense allegedly committed by the probationer before revocation orders can be entered. Battle v. State, 571 S.W.2d 20 (No. 57,806, 1978); Holder v. State, 571 S.W.2d 885 (1978); Jones v. State, Tex.Cr.App., 560 S.W.2d 673; Wygal v. State, Tex.Cr.App., 555 S.W.2d 465.
The Court in Breed wrote:
"We believe it is simply too late in the day to conclude, as did the District Court in this case, that a juvenile is not put in jeopardy at a proceeding whose object is to determine whether he has committed acts that violate a criminal law and whose potential consequences include the stigma inherent in such a determination and the deprivation of liberty for many years." Breed v. Jones, 421 U.S. at 529, 95 S.Ct. at 1785.
"Jeopardy denotes risk. In the constitutional sense, jeopardy describes the risk that is traditionally associated with a criminal prosecution." Id., U.S. at 528, 95 S.Ct. at 1785.
"As we have observed, the risk to which the term jeopardy refers is that *78 traditionally associated with `actions intended to authorize criminal punishment to vindicate public justice.' [Citations omitted] Because of its purpose and potential consequences, and the nature and resources of the State, such a proceeding imposes heavy pressures and burdens psychological, physical, and financialon a person charged. The purpose of the Double Jeopardy Clause is to require that he be subject to the experience only once `for the same offense.' [Citations omitted]." Id., U.S. at 529-530, 95 S.Ct. at 1786.
In concluding their analysis of the California juvenile adjudicatory process under the double jeopardy doctrine, the Supreme Court wrote:
"Thus, in terms of potential consequences, there is little to distinguish an adjudicatory hearing such as was held in this case from a traditional criminal prosecution. For that reason, it engenders elements of `anxiety and insecurity' in a juvenile, and imposes a `heavy personal strain.'" Id., U.S. at 530-531, 95 S.Ct. at 1786.
Turning to this State's probation revocation proceeding, it is evident that one "risk" a probationer is subjected to upon the filing of a motion to revoke probation and a hearing on that motion is the revocation of the probation and the immediate imposition of a penalty previously assessed. Regardless of what label we attach to the proceeding, the consequence is the same. The probationer faces the "risk" of losing his liberty.
Notwithstanding the greater resources and power available to the State, the burdens imposed upon them in order to effect a revocation of one's probation are much less than in a traditional criminal prosecution. As was already noted, the burden of proof is only by a preponderance of evidence instead of beyond a reasonable doubt. Further, accomplice witnesses need not be corroborated. Howery v. State, Tex.Cr.App., 528 S.W.2d 230. Confessions of the probationer need not be corroborated. Bush v. State, Tex.Cr.App., 506 S.W.2d 603. The motion to revoke probation need not be as precise as an indictment or information, but need only give fair notice to the probationer of the condition of probation allegedly violated. Figgins v. State, Tex.Cr.App., 528 S.W.2d 261. In fact, should the proof adduced during the proceedings vary from the motion to revoke probation on file, the trial court is empowered to permit the State to make an amendment to its pleadings. Banks v. State, Tex.Cr.App., 491 S.W.2d 417; Cabrera v. State, Tex.Cr.App., 494 S.W.2d 177; Spencer v. State, Tex.Cr.App., 503 S.W.2d 557.
Yet the anxiety, insecurity, strain, and potential of imprisonment are real "risks" faced by the probationer brought before the court on a motion to revoke probation filed by the State. The stigma from a revocation of probation is real, especially when the revokee is subsequently considered for parole.
It occurs to me that in light of this overwhelming advantage possessed by the State and the "risks" facing the probationer, the doctrine of double jeopardy should apply to a subsequent revocation of probation proceeding in which the basis for the State's motion to revoke is the same offense previously alleged for revocation purposes, but which the State failed to prove to the satisfaction of the trial court with sufficient evidence. Under these narrow circumstances, appellant should be entitled to reversal.
In the instant case, an order was signed and entered by the trial judge on October 27, 1976, following a hearing on the State's September 3, 1976, motion to revoke probation. That order reads, in pertinent part:
"... The Court proceeded to hear evidence on said motion and after hearing said evidence and the arguments of counsel and considering the same and the law, the Court is of the opinion and so holds that the evidence is insufficient inasmuch as there is no evidence to show that the defendant operated a motor vehicle on a public road and highway in the State of Texas and County of El Paso." (Emphasis added.)
In this rare situation where the trial court expressly finds that the evidence is insufficient, *79 the doctrine of double jeopardy should certainly attach to any subsequent efforts to revoke the probationer's condition on the same offense. See Burks v. U. S., 437 U.S. 1, 98 S.Ct. 2141, 57 L.Ed.2d 1 (1978); Greene v. Massey, 437 U.S. 19, 98 S.Ct. 2151, 57 L.Ed.2d 15 (1978).
As stated by the Supreme Court in Burks v. U. S., supra, "the purposes of the Clause [double jeopardy] would be negated were we to afford the Government an opportunity for the proverbial `second bite at the apple.'" 437 U.S. at 17, 98 S.Ct. at 2150.
The majority relies on Bass v. State, supra, a terse opinion which in turn relied on Settles v. State, Tex.Cr.App., 403 S.W.2d 417, and Barber v. State, Tex.Cr.App., 486 S.W.2d 352. The reliance of this Court in Bass on the inapposite cases of Settles and Barber should be reconsidered. The Bass case represented a situation similar to the instant matter. A motion to revoke probation was heard and denied in February of 1970. The precise basis for the denial of the State's motion to revoke is not explained. Nevertheless, two years later a hearing was conducted on a motion to revoke probation alleging the same offense that was considered in the February 1970 hearing. At the subsequent hearing appellant's probation was revoked after the same evidence was introduced as in the first hearing, as well as the information, judgment, sentence, and mandate of affirmance of appellant's conviction for misdemeanor embezzlement. This Court merely concluded that no abuse of discretion was shown and relied on the authorities referred to above. An analysis of the authorities relied upon by this Court in Bass shows that different procedural contexts were involved in those cases.
In Settles the appellant attempted to invoke the prior unsuccessful effort of the State to revoke his probation as a bar to his subsequent prosecution on the substantive offense of aggravated assault. The first risk faced by appellant was the revocation of his probation and the imposition of a sentence previously suspended. In the latter proceeding brought up to this Court on direct appeal, the risk was the assessment of a penalty for the actual offense involved.
Barber v. State, supra, involved the appellant's contention that the trial court abused its discretion in permitting the State to amend its motion to revoke probation during the hearing on the original motion to revoke probation. Appellant made the argument that such action constituted double jeopardy, thus an abuse of discretion. This Court concluded that such a contention was without merit. I would submit that the decision in Barber was correct, but totally inapposite to the issues raised in Bass and the instant case. I would conclude, therefore, that Bass should be overruled.
This case does not involve collateral questions that some might fear would be answered or implicated in the holding I propose. First, it does not deal with the State pursuing a motion to revoke probation after the probationer was acquitted on the substantive offense alleged in the motion to revoke probation as a violation of the probationary conditions. Further, it does not address the question raised in Settles, on which some doubt might be cast, of instituting substantive criminal prosecutions against probationers after the State has attempted to revoke their probation on the basis of the same offense, but which the trial court concluded were insufficiently proven by the State. We leave those questions for another day.
The majority decision quotes from Breed v. Jones, supra, that "[T]he risk to which the [Double Jeopardy] Clause refers is not present in proceedings that are not essentially criminal." A review of the cases cited by the Supreme Court in support of that phrase reflects that the "risks" involved in the various cases were the forfeiture of smuggled goods [One Lot Emerald Cut Stones v. U. S., 409 U.S. 232, 93 S.Ct. 489, 34 L.Ed.2d 438 (1972)], the collection of double damages, plus forfeiture of actual damages, pursuant to "informer statutes" because of the collusive bidding on government work projects [U. S. ex rel. Marcus v. Hess, 317 U.S. 537, 63 S.Ct. 379, 87 L.Ed. *80 443 (1943)], and the collection of a 50 percent penalty calculated on the deficiency in taxes paid to the Internal Revenue Service [Helvering v. Mitchell, 303 U.S. 391, 58 S.Ct. 630, 82 L.Ed. 917 (1938)]. None of the cases involved the type of "risk" faced by either a criminal defendant or probationer facing a motion to revoke probation. However, there is one quotation from Helvering v. Mitchell, supra, which if interpreted literally and out of context would present a disquieting prospect for my position. That is:
"Remedial sanctions may be of varying types. One which is characteristically free of the punitive criminal element is revocation of a privilege voluntarily granted." Id., U.S. 399, 58 S.Ct. at 633.
However, the cases on which that proposition was based involved alien deportations and disbarments. Neither of those consequences involves the loss of liberty traditionally associated with criminal prosecutions or "criminal punishment to vindicate public justice."
Finally, an analysis that holds true to the teachings of Breed v. Jones, supra, needs to answer the question raised by the following excerpt:
"If there is to be an exception to that protection [of the double jeopardy clause] in the context of the juvenile-court system, it must be justified by interests of society, reflected in that unique institution, or of juveniles themselves, of sufficient substance to render tolerable the costs and burdens, noted earlier, which the exception will entail in individual cases."
In Breed the Court was confronted with the contention that to apply the protections of the double jeopardy clause to the proceedings at issue would deprive the juvenile court system of California of the flexibility needed to deal with youthful offenders. This contention was rejected by the Supreme Court since from a review of procedures in other states it was clear that a waiver of jurisdiction and transfer proceeding could be accomplished without a full adjudication of the facts of the offense as was done under the California procedures. Similarly, the application of the protections of the double jeopardy clause to probationers whom the State seeks to imprison after having failed to prove their allegations on their first try will not disrupt any legitimate State interests. The only burden on the State created by the application of this doctrine is that they do the job right the first time. The people of this State deserve no less and the prosecutors of this State should expect no more.
Therefore, I would hold that in a case where the trial court expressly finds that the evidence was insufficient to sustain the State's motion to revoke probation based on an allegation that the probationer committed an offense in violation of his probationary conditions, the double jeopardy clause of the United States and Texas Constitutions protects that probationer from any subsequent efforts by the State to revoke his probation based on the same alleged offense.
II.
Again, in confronting the contention of appellant that, in the alternative, the res judicata doctrine applies to the situation described above, the majority shields this State's probation revocation proceedings behind labels of convenience. By considering the matter administrative in nature and not judicial, the majority concludes that the doctrine of res judicata does not apply. Should the foregoing analysis and discussion which concludes that the double jeopardy clause should attach to such proceedings not be accepted, I would submit that in the alternative the doctrine of res judicata should apply.
The doctrine of res judicata is based on public policy:
"... Once the claims of the parties have been determined by the ultimate tribunal provided by law for their adjudication, the matter should be concluded. It is recognized that there must be an end of litigation somewhere, and that when a case has once been tried and the issues duly disposed of, the litigation should be ended, unless some proper *81 ground is shown for vacation or modification of the judgment by a higher tribunal or a court of equity, since the parties have had their day in court and the judgment of the court, which is presumably correct, impartial, and honest, should be conclusive on them." 34 Tex.Jur.2d, Judgments, Sec. 451, pp. 492-495.
Under the facts as presented in the case at bar, and in the event the double jeopardy doctrine is considered inapplicable, I perceive no reason why the doctrine of res judicata should not bar the State's attempt to relitigate the issue previously decided in appellant's favor. Why should appellant be required to defend himself again in a revocation of probation proceeding based upon the same alleged probationary violation previously adjudicated adversely to the State? We see no reason in law or logic why the State should have an opportunity to take a "second bite out of the apple."
The State argues that the argument does not apply here because one of the requisites of res judicata is the existence of a final judgment and the order entered after a probation revocation hearing is not a judgment as defined in Article 42.01, V.A.C.C.P. While such an order is not a judgment of conviction as defined in Article 42.01, supra, it is nevertheless a final judgment. It is a judgment because it rules on the issues of fact and law litigated before it in the hearing, and either grants or denies the revocation sought by the State. Article 42.01, supra, by its very terms cannot apply to revocation proceedings. The finality of the trial court's order of either revoking probation or continuing the defendant on probation in respect to the alleged violations cannot be questioned. In Wester v. State, 542 S.W.2d 403, the trial court found the defendant had violated his probation, but in its discretion continued him on probation. On a subsequent arrest the trial court revoked probation on the previously found violation. Wester held the trial court could not go behind the order continuing the defendant on probation even though adequate grounds for revocation had previously been shown. "To hold otherwise would violate due process, due course of the law of the land and fundamental fairness." Id. at 406. Clearly, after the trial judge had continued the defendant therein on probation, and had made his ruling denying the State's motion to revoke, that order was final. See and compare Wester v. State, supra, with Sappington v. State, Tex.Cr.App., 508 S.W.2d 840, and Traylor v. State, Tex.Cr.App., 561 S.W.2d 492.
Mr. Justice Holmes, speaking for the Supreme Court in United States v. Oppenheimer, 242 U.S. 85, 37 S.Ct. 68, 61 L.Ed. 161 (1916), expressed the view:
"Upon the merits the proposition of the government is that the doctrine of res judicata does not exist for criminal cases except in the modified form of the 5th Amendment, that a person shall not be subject for the same offense to be twice put in jeopardy of life or limb; ...
* * * * * *
The safeguard provided by the Constitution against the gravest abuses has tended to give the impression that when it did not apply in terms, there was no other principle that could. But the 5th Amendment was not intended to do away with what in the civil law is a fundamental principle of justice ... in order, when a man once has been acquitted on the merits, to enable the government to prosecute him a second time."
Although res judicata in principle and theory springs from the same fundamental principle of justice as does the double jeopardy clause, it can be applied in cases where a plea of former acquittal or former conviction could not be entertained, and where double jeopardy protections do not apply. See 9 A.L.R.3rd 203 and cases cited therein.
It cannot be doubted that due process applied to probation revocation hearings. Spencer v. State, Tex.Cr.App., 503 S.W.2d 557; Wester v. State, supra. To hold that the State could again litigate the same issue that had once before been fairly and finally adjudicated would thwart basic concepts of fundamental fairness. Cf. Wester v. State, supra. Certainly the benefit accruing to the State by allowing it to file another *82 motion to revoke probation alleging the same facts on the same alleged probationary violation that had been adjudicated adversely to it previously after a full and fair hearing is outweighed by the burden such a practice would place on the probationer by requiring him to again defend against the same charge. Where would a rule allowing relitigation by the State stop? After two unsuccessful bites at the apple? After a dozen? The line must be drawn at one day in court. Cf. Stone v. Powell, 428 U.S. 465, 96 S.Ct. 3037, 40 L.Ed.2d 1067 (1976). The State had already had its day in court on the facts reurged in its second motion to revoke probation. The trial court in the first proceeding made an express finding that the evidence was insufficient to support a revocation order.
In Green v. United States, 355 U.S. 184, 78 S.Ct. 221, 2 L.Ed.2d 199, the Supreme Court stated:
"The underlying idea, one that is deeply ingrained in at least the Anglo-American system of jurisprudence, is that the State with all its resources and power should not be allowed to make repeated attempts to convict an individual for the alleged offense, thereby subjecting him to embarrassment, expense and ordeal and compelling him to live in a continuing state of anxiety and insecurity, as well as enhancing the possibility that even though innocent he may be found guilty." Id., U.S. at 187-188, 78 S.Ct. at 223.
I would therefore conclude that, in the alternative, the doctrine of res judicata operates as an equal bar against the second effort of the State to revoke appellant's probation on the same offense on which they previously failed to muster sufficient evidence.
For the foregoing reasons I respectfully dissent.
ONION, P. J., and ROBERTS, J., join in this dissent.
NOTES
[1] "On the 13th day of August, 1976, in the County of El Paso and State of Texas, the said defendant, Johnny Davenport, did then and there unlawfully, drive an automobile, to-wit: a Ford Pinto upon a street within the limits of an incorporated city, to-wit: El Paso, Texas, while the said Johnny Davenport was intoxicated."
[2] This case does not present the same factual situation as was discussed in Banks v. State, Tex.Cr.App., 503 S.W.2d 582.
[3] "No person, for the same offense, shall be twice put in jeopardy of life or liberty, nor shall a person be again put upon trial for the same offense, after a verdict of not guilty in a court of competent jurisdiction."
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T.C. Memo. 2006-64
UNITED STATES TAX COURT
WAYNE CURTIS SIRON, Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 11208-04. Filed April 4, 2006.
Wayne Curtis Siron, pro se.
Jeanne Gramling, for respondent.
MEMORANDUM OPINION
WELLS, Judge: Respondent determined a deficiency in
petitioner’s 1998 Federal income tax of $3,161, a section
6651(a)(1) addition to tax for failure to file of $788.25, and a
section 6654(a) addition to tax for failure to pay estimated
income tax of $144.25. The issues to be decided are whether
petitioner is liable for the deficiency as determined by
- 2 -
respondent, whether petitioner is liable for the additions to tax
as determined by respondent, and whether petitioner is liable for
a penalty under section 6673. All section and Code references
are to the Internal Revenue Code, as amended, and all Rule
references are to the Tax Court Rules of Practice and Procedure.
Background
The facts in this case have been established by the Court’s
order of December 28, 2005.1 At the time of filing the petition,
petitioner resided in Blythewood, South Carolina. Petitioner was
married to Rose Siron throughout 1998.
During 1998, petitioner received compensation from FN
Manufacturing, Inc. (FN Manufacturing), of $27,011.27 and
received compensation from the State Board of Technical and
Comparative Education (the State Board) of $323. FN
Manufacturing and the State Board each issued petitioner a
1998 Form W-2, Wage and Tax Statement, reflecting those
payments. FN Manufacturing withheld zero Federal income taxes
1
As discussed below, on Nov. 18, 2005, respondent filed a
motion to show cause why proposed facts and evidence should not
be accepted as established pursuant to Rule 91(f). On Nov. 21,
2005, we granted respondent’s motion and further ordered
petitioner to file a response in compliance with Rule 91(f)(2) or
respondent’s proposed stipulations would be deemed established
and an order would be entered pursuant to Rule 91(f)(3).
Petitioner never responded to our order, and, accordingly, we
ordered the facts deemed established on Dec. 28, 2005.
- 3 -
from its payments to petitioner,2 and the State Board withheld
$8.
Petitioner did not file a 1998 Federal income tax return,
and respondent prepared a substitute for return for petitioner
pursuant to section 6020(b).3 Because petitioner did not elect
to file a joint return with Rose Siron, respondent determined
petitioner’s filing status to be married filing separate.
Accordingly, respondent determined petitioner’s taxable income
for 1998 to be $21,084.4
On April 2, 2004, respondent mailed a statutory notice of
deficiency to petitioner. In response, petitioner timely filed a
petition with this Court for a redetermination of the deficiency.
The petition made the following contentions: “I do not have any
tax liability. I deny the figures and content of the Notice of
Deficiency. I dispute the computations. In the year in
question, I had dependents, deductions, credits, business
expenses, etc. Have appeals contact me.”
2
From the record, it appears that petitioner claimed 99
exemptions on a Form W-4, Employee’s Withholding Allowance
Certificate, with respect to his 1998 Federal income tax
withholdings.
3
The parties have made no contentions as to whether the
substitute for return respondent prepared in the instant case
satisfies sec. 6020(b).
4
Respondent reduced petitioner’s $27,334 of gross income by
a $3,550 standard deduction and $2,700 of exemptions.
- 4 -
In June of 2004, petitioner designated Kansas City,
Missouri, as the place of trial, and the Court set the case for
trial at the Kansas City trial session beginning February 14,
2005. On November 17, 2004, petitioner filed a motion to
continue and change place of trial to Columbia, South Carolina.
The Court granted petitioner’s motion.
In a letter dated June 9, 2005, respondent’s counsel
notified petitioner that Rule 91 requires parties to “agree which
facts and documents are not in dispute, and submit them to the
court as a ‘Stipulation of Facts.’” Accordingly, respondent’s
counsel requested that petitioner respond to the following
questions and requests for information:
1. Did you file a 1998 federal income tax return? If
so, please provide a copy of the return.
2. Do you agree that FN Manufacturing, Inc. paid you
$27,011 in 1998?
3. Do you agree that the State Board of Technical &
Compr. Education paid you $323 in 1998?
4. Do you agree that you paid mortgage interest in
the amount of $4,161 in 1998? (This is the only
expense which was reported to the Service).
5. How many dependents did you have in 1998? What
were their names and ages? Where did each
dependent live?
6. Please provide documents showing all Schedule A
itemized deductions you claim, if any, for the
taxable year 1998, including invoices, cancelled
checks, and receipts.
- 5 -
7. Please provide documents showing all Schedule C
expenses, if any, you claim for the taxable year
1998, including invoices, cancelled checks, and
receipts.
8. Please provide documents showing all credits you
claim for the taxable year 1998.
In a letter to respondent’s counsel dated June 25, 2005,
petitioner responded that FN Manufacturing paid petitioner
$27,011 in 1998, that the State Board paid petitioner $323 in
1998, and that petitioner did not file a 1998 Federal income tax
return. The letter stated that it was immaterial whether
petitioner paid mortgage interest in 1998 or had dependents.
Additionally, the letter refused to provide documents
substantiating deductions claimed on Schedule A, Itemized
Deductions, or expense deductions claimed on Schedule C, Profit
or Loss from Business, on grounds that petitioner was not
required to file a 1998 Federal income tax return and refused to
provide documents substantiating claimed credits on grounds that
such information had not been proven to be required.
On July 14, 2005, respondent’s counsel submitted to
petitioner a proposed stipulation of facts based upon the
information provided in petitioner’s letter dated June 25, 2005.
The proposed stipulation of facts stated that, at the time of
filing the petition, petitioner resided in Blythewood, South
Carolina, that petitioner did not file a 1998 Federal income tax
return, that FN Manufacturing paid petitioner $27,011 during
- 6 -
1998, and that the State Board paid petitioner $323 during 1998.
Respondent’s proposed stipulation of facts referenced the
following documents: (1) The statutory notice of deficiency;
(2) respondent’s letter to petitioner dated June 9, 2005;
(3) petitioner’s letter to respondent dated June 25, 2005; and
(4) respondent’s certified literal transcript for petitioner.
Additionally, respondent provided petitioner with a copy of
respondent’s publication entitled “The Truth About Frivolous Tax
Arguments” and directed petitioner to the publication’s
discussion of penalties that may be imposed on taxpayers who take
frivolous positions. Respondent also provided petitioner with a
copy of Hodges v. Commissioner, T.C. Memo. 2005-168, in which the
Tax Court imposed a section 6673 penalty on the taxpayer for
advancing a frivolous argument.
In a letter to respondent’s counsel dated August 2, 2005,
petitioner stated that any stipulations would be premature until
the completion of the discovery process. Additionally,
petitioner disputed the relevance of Hodges, and the
aforementioned IRS publication.
In a letter to petitioner dated August 25, 2005,
respondent’s counsel informed petitioner that respondent would
request that the Court impose a penalty pursuant to section 6673
- 7 -
if petitioner persisted in raising frivolous arguments. The
letter stated that petitioner could be required to pay a penalty
of $25,000 pursuant to section 6673.
On August 26, 2005, respondent filed respondent’s requests
for admission, which made the following contentions:
1. The petitioner lived in Blythewood, South
Carolina, at the time of the filing of his
petition in this case.
2. The petitioner did not file a federal income tax
return for the taxable year 1998.
3. Attached as Exhibit 1 is an authentic copy of the
notice of deficiency mailed to petitioner on April
2, 2004.
4. During 1998, FN Manufacturing, Inc., paid
petitioner wages in the amount of $27,011.
5. FN Manufacturing, Inc., issued petitioner a Form
W-2 for the taxable year 1998 reflecting wages in
the amount of $27,011.
6. During 1998, the State Board of Technical and
Compr. Education paid petitioner wages in the
amount of $323.
7. The State Board of Technical and Compr. Issued
petitioner a Form W-2 for the taxable year 1998
reflecting wages in the amount of $323.
8. During 1998, the State Board of Technical and
Compr. Education withheld federal income tax in
the amount of $8 from the amount paid to
petitioner.
9. Petitioner was married to Rose Siron during the
entire year of 1998.
10. Attached as Exhibit 2 is a certified literal
transcript of petitioner’s 1998 federal income tax
account.
- 8 -
PLEASE TAKE NOTICE that pursuant to Tax Court Rule
90, a written answer to these requests must be filed
with the Tax Court and a copy served on the undersigned
within 30 days after service of these requests for
admission.
Also on August 26, 2005, respondent lodged a response to
petitioner’s requests for admission. As petitioner had filed no
request for admission with this Court, as of that date,5 the
Court ordered petitioner to file a request for admission by
September 26, 2005. However, petitioner failed to file such a
request for admission in compliance with the Court’s order.
Instead, on September 26, 2005, petitioner filed a response to
respondent’s request for admissions. Petitioner admitted that he
was married to Rose Siron throughout 1998, that he resided in
Blythewood, South Carolina, at the time of filing the petition,
that FN Manufacturing paid petitioner compensation of $27,011
during 1998, that the State Board paid petitioner compensation
of $323 during 1998, and that the State Board withheld Federal
income tax of $8. However, with respect to respondent’s requests
5
Respondent submitted to the Court a document purporting to
be “Petitioner’s First Request for Admissions” as an exhibit to
respondent’s motion to show cause why proposed facts and evidence
should not be accepted as established. The document was signed
by petitioner and dated Aug. 29, 2005, but was not filed with
this Court by petitioner. The document contained a series of
incoherent and illogical arguments purporting to rely on the 16th
Amendment, the Internal Revenue Code, and Supreme Court
decisions.
- 9 -
for admission that petitioner did not file a 1998 Federal income
tax return, petitioner’s response stated:
Respondent does not further identify the “federal
income tax return” sufficiently as to Form Number,
Title, and O.M.B. Number, to create with any certainty
the identification of the “tax return” so that
Petitioner can admit or deny with certainty any
required “tax return”.
If Respondent had stated such return was required, and
further identified said required return as to its Form
Number and O.M.B. Number, then Petitioner could respond
with certainty.
Conditionally denies pending further definition.
On October 13, 2005, respondent submitted to petitioner a
revised stipulation of facts (the revised stipulation of facts)
that omitted the paragraph relating to petitioner’s failure to
file a 1998 Federal income tax return. The revised stipulation
of facts also noted petitioner’s objections to the accuracy of
the statutory notice of deficiency and other documents.
Respondent requested that petitioner sign the revised stipulation
of facts and return it to respondent’s counsel.
In a letter to respondent’s counsel dated October 29, 2005,
petitioner stated that none of respondent’s proposed stipulations
had merit. With the letter dated October 29, 2005, petitioner
submitted to respondent his own proposed stipulations, comprising
- 10 -
various irrelevant and/or illogical statements some of which are
set forth below:
Petitioner received a “Notice of Deficiency” in error,
as he has not yet been proven to be a ‘taxpayer’ for
purposes of said “Notice of Deficiency”.
* * * * * * *
The Commissioner’s employees refused, and continue to
refuse to provide law(s) and/or authoritative
regulation(s) to the Petitioner proving that he was
subject to any part of Title 26, United States Code,
Subtitle A, for 1998.
* * * * * * *
Petitioner has derived no income from any of the
sources named by Congress in Title 26, USC, Subtitle A.
* * * * * * *
There are no laws and/or authoritative regulations in
Title 26, USC, Subtitle A that require a sovereign
citizen to file a Form 1040, U.S. Individual Income Tax
Return, O.M.B. Number 1545-0074 for any money earned in
the private sector of the U.S. economy.
* * * * * * *
Title 26, USC, Sections 6212 and 6213 have no
authoritative or implementing regulations.
* * * * * * *
For sovereign persons who have no requirement to file
and pay a Form 1040, U.S. Individual Income Tax Return,
O.M.B. number 1545-0074; the legal contest to prove
otherwise must be in compliance with 26 USC, Sections
7401 and 7403.
On November 18, 2005, respondent filed a motion to show
cause why proposed facts and evidence should not be accepted as
- 11 -
established.6 As noted supra note 1, we granted respondent’s
motion and further ordered petitioner to file a response in
compliance with Rule 91(f)(2) or respondent’s proposed
stipulations would be deemed established. Petitioner failed to
file a response. Consequently, we ordered the facts deemed
stipulated pursuant to Rule 91(f)(3).
On January 9, 2006, the parties appeared at trial, and
respondent filed a motion for penalty pursuant to section 6673.
Discussion
Section 61(a) provides that gross income includes all income
from whatever source derived except as otherwise provided.
Specifically, gross income includes compensation for services.
Sec. 61(a)(1). Section 6012(a) generally requires the filing of
a tax return by every individual with gross income equal to or
exceeding the exemption amount.
Petitioner contends that he had no taxable income in 1998
and, consequently, that he was not required to file an income tax
return or pay income tax. However, petitioner concedes that he
received $27,011.27 of compensation from FN Manufacturing and
$323 of compensation from the State Board during 1998.
Petitioner has not made any viable contention or offered any
evidence as to why that compensation should not be included in
6
The proposed facts referenced in respondent’s motion to
show cause are nearly identical to the revised stipulation of
facts.
- 12 -
his taxable income for 1998. Consequently, we conclude that
petitioner’s taxable income for 1998 includes the payments
received from FN Manufacturing and the State Board.
Section 6651(a)(1) provides for an addition to tax of 5
percent of the tax required to be shown on the return for each
month or fraction thereof for which there is a failure to file,
not to exceed 25 percent. The addition to tax for failure to
file a return timely will be imposed if the return is not filed
timely unless the taxpayer shows that the delay was due to
reasonable cause and not willful neglect. Sec. 6651(a)(1).
Respondent bears the burden of production with respect to the
addition to tax. Sec. 7491(c). The record demonstrates that
petitioner failed to file a 1998 Federal income tax return.
Petitioner has made no contention and offered no evidence that
the delay was due to reasonable cause and not willful neglect.
Consequently, we conclude that petitioner is liable for the
section 6651(a)(1) addition to tax for failure to file as
determined by respondent.
Section 6654(a) provides for an addition to tax for an
underpayment of estimated tax by an individual. This addition to
tax is mandatory unless one of the statutorily provided
exceptions applies. Sec. 6654(e). The record demonstrates that
petitioner did not remit any estimated tax payments for 1998, and
none of the statutory exceptions applies. Consequently, we
- 13 -
conclude that petitioner is liable for the section 6654(a)
addition to tax as determined by respondent.
Section 6673(a)(1) authorizes this Court to require a
taxpayer to pay a penalty not in excess of $25,000 whenever the
taxpayer’s position is frivolous or groundless or the taxpayer
has instituted or pursued the proceeding primarily for delay.
SEC. 6673. SANCTIONS AND COSTS AWARDED BY COURTS.
(a) Tax Court Proceedings.--
(1) Procedures instituted primarily for
delay, etc.--Whenever it appears to the Tax Court
that–-
(A) proceedings before it have been
instituted or maintained by the taxpayer
primarily for delay,
(B) the taxpayer’s position in such
proceeding is frivolous or groundless, or
(C) the taxpayer unreasonably failed to
pursue available administrative remedies,
the Tax Court, in its decision, may require the
taxpayer to pay to the United States a penalty not in
excess of $25,000.
The record demonstrates that petitioner advanced frivolous
and groundless arguments during the instant proceedings. We
shall not refute frivolous arguments with copious citation and
extended discussion. Williams v. Commissioner, 114 T.C. 136,
138-139 (2000) (citing Crain v. Commissioner, 737 F.2d 1417, 1417
(5th Cir. 1984)). The record is replete with warnings to
petitioner that a penalty could be imposed if petitioner
- 14 -
continued making frivolous arguments. As noted above, in July of
2005, respondent’s counsel provided petitioner with a copy of
respondent’s publication entitled “The Truth About Frivolous Tax
Arguments” and directed petitioner to the publication’s
discussion of penalties that may be imposed on taxpayers who take
frivolous positions. Respondent also provided petitioner with a
copy of Hodges v. Commissioner, T.C. Memo. 2005-168, in which the
Tax Court imposed a penalty on the taxpayer pursuant to section
6673. Additionally, in a letter to petitioner dated August 25,
2005, respondent’s counsel informed petitioner that respondent
would request that the Court impose a section 6673 penalty if
petitioner persisted in raising frivolous arguments. As noted
above, respondent filed a motion for a section 6673 penalty at
trial.
Moreover, the record demonstrates that petitioner instituted
proceedings before this Court primarily for delay. Petitioner
initially designated Kansas City as the place of trial despite
his residence in South Carolina throughout the proceedings.
Petitioner refused to agree to respondent’s proposed stipulation
of facts, based upon information provided by petitioner, despite
the efforts of respondent’s counsel to accommodate all of
petitioner’s specific complaints.
For the foregoing reasons, we conclude that petitioner has
intentionally made frivolous arguments in these proceedings and
- 15 -
has instituted these proceedings primarily for delay, wasting the
limited resources of the Federal tax system. Consequently, we
shall grant respondent’s motion and require petitioner to pay to
the United States a penalty of $1,500 pursuant to section
6673(a)(1).
To reflect to foregoing,
An appropriate order and
decision will be entered.
| {
"pile_set_name": "FreeLaw"
} |
527 Pa. 375 (1991)
592 A.2d 669
COMMONWEALTH of Pennsylvania, Appellee,
v.
Despina SMALIS, Appellant.
Supreme Court of Pennsylvania.
Argued September 24, 1990.
Resubmitted March 22, 1991.
Decided May 9, 1991.
Dissenting Opinion July 23, 1991.
*376 Norma Chase, Pittsburgh, for appellant.
*377 Robert E. Colville, Dist. Atty., Claire C. Capristo, Deputy Dist. Atty., Kemal Alexander Mericli and James R. Gilmore, Asst. Dist. Attys., Pittsburgh, for appellee.
Before NIX, C.J., and LARSEN, FLAHERTY, McDERMOTT, ZAPPALA, PAPADAKOS and CAPPY, JJ.
Dissenting Opinion of Justice Papadakos July 23, 1991.
OPINION
McDERMOTT, Justice.
In this appeal we are asked to decide whether appellant's constitutional rights will be violated if her bench trial is resumed following an extended stay of the proceedings occasioned by the Commonwealth's appeal from an order sustaining demurrers to certain, but not all, criminal charges.
Appellant, Despina Smalis, along with her husband, owned adjoining buildings located in the Oakland section of Pittsburgh. The premises housed the "Chances R" restaurant and lounge on the first floor and seven moderately-priced rental apartments on the second floor. On the morning of February 12, 1979, at approximately 6:30 A.M., a fire occurred that resulted in the death of two tenants, Judith Ann Ross and Dale Burton. Following a grand jury investigation into the nature of the fire, criminal informations were filed by the Allegheny County District Attorney's Office charging appellant and her husband with criminal homicide,[1] reckless endangerment,[2] causing a catastrophe,[3] failing to prevent a catastrophe,[4] and with respect to appellant alone, securing the execution of documents by deception[5] in connection with the failure to install two fire-resistant metal doors in the building.
*378 The parties proceeded with a bench trial in the Court of Common Pleas of Allegheny County on November 12, 1980. At the close of the Commonwealth's case-in-chief, appellant and her husband challenged the sufficiency of the evidence by way of a demurrer. The trial court sustained the demurrer to the evidence with respect to the charges of murder, voluntary manslaughter and causing a catastrophe. As was the practice at the time in this Commonwealth, the remaining misdemeanor charges were stayed by the trial court pending the outcome of the Commonwealth's appeal to the order sustaining the demurrer. See Commonwealth v. Wimberly, 488 Pa. 169, 411 A.2d 1193 (1980).
The appeal to the Superior Court was taken by the Commonwealth on December 19, 1980. The Superior Court quashed the appeal on the ground that the sustaining of the demurrer was the functional equivalent of an acquittal and therefore a direct appeal by the Commonwealth was barred by the Double Jeopardy Clause of the Fifth Amendment of United States Constitution.[6]Commonwealth v. Smalis, 331 Pa.Super. 307, 480 A.2d 1046 (1984). On appeal to this Court, we reversed, finding the appeal not constitutionally offensive and remanded to the Superior Court with instructions to pass upon the merits of the demurrer ruling entered by the trial court. Commonwealth v. Zoller, 507 Pa. 344, 490 A.2d 394 (1985).[7]
At this point, appellant and her husband petitioned for a writ of certiorari to the United States Supreme Court. The Court accepted the case and thereafter held that the grant of a demurrer at the close of the prosecution's case-in-chief constituted an acquittal under the Double Jeopardy Clause thus barring an appeal by the Commonwealth. Smalis v. *379 Pennsylvania, 476 U.S. 140, 106 S.Ct. 1745, 90 L.Ed.2d 116 (1986).
In accordance with this mandate, this Court entered a per curiam order on July 29, 1986, vacating our previous order and reinstating the order of the Superior Court which quashed the Commonwealth's appeal. Commonwealth v. Smalis, 511 Pa. 229, 512 A.2d 634 (1986).
The Commonwealth next sought resumption of trial on the remaining misdemeanor charges originally stayed by the trial court. On December 12, 1986, appellant and her husband filed a motion to dismiss the remaining charges on various constitutional grounds. This motion, following briefing and oral argument, was denied by the trial court on January 9, 1987. Because of the potential constitutional implication caused by the delay of the proceedings, the trial court certified the order denying the motion to dismiss the remaining charges to the Superior Court, pursuant to 42 Pa.C.S. § 702(b). The Superior Court, on appeal, affirmed the trial court's order denying the motion to dismiss, and found the constitutional claims wanting in merit. The court remanded the matter to the trial court for further proceedings. Commonwealth v. Smalis, 375 Pa.Super. 601, 545 A.2d 284 (1988). Appellant's husband sought no further review. Appellant, however, filed an application for reargument, which was denied on August 5, 1988. We then granted appellant's petition for allowance of appeal to examine the constitutional impact, if any, of the delay in the resumption of trial on the outstanding misdemeanor charges.
Appellant attacks the resumption of her trial on three constitutional fronts. First, she equates the delay with that of a "mistrial" and therefore asserts that the resumption of trial on the outstanding misdemeanor charges would offend the Double Jeopardy Clause. Appellant argues that the substantial break in the continuity of the trial, in effect, removed jeopardy since the immediacy of the threat to her liberty was terminated with the stay. We disagree with this assertion.
*380 The Double Jeopardy Clause has been recognized by the United States Supreme Court as having three separate and distinct objectives: the protection of the integrity of a final judgment, the prohibition against multiple prosecutions, even where no final determination of guilt has been made, and the proscription against multiple punishments for the same offense. North Carolina v. Pearce, 395 U.S. 711, 89 S.Ct. 2072, 23 L.Ed.2d 656 (1969). See also Commonwealth v. Zoller, 507 Pa. at 349-52, 490 A.2d at 396-98; Commonwealth v. Frisbie, 506 Pa. 461, 485 A.2d 1098 (1984). Under the facts of this case, we are confronted with neither a final judgment, multiple prosecutions nor multiple punishments. Rather, with respect to the remaining misdemeanor charges, jeopardy does not come into play because the trial court denied appellant's demurrer to these charges and found as a matter of law that the Commonwealth's evidence was sufficient to establish appellant's guilt beyond a reasonable doubt. See Commonwealth v. Mitchell, 460 Pa. 665, 334 A.2d 285 (1975); Commonwealth v. DePetro, 350 Pa. 567, 39 A.2d 838 (1944). Therefore, since these remaining charges survived the demurrer challenge and as of this date appellant has not been "acquitted" of these charges, we see no double jeopardy implication that would preclude further prosecution.
Appellant's second argument pertains to an alleged violation of her rights under the Confrontation Clause of the Sixth Amendment of the United States Constitution. The Sixth Amendment provides that an accused, "[i]n all criminal prosecutions . . . shall enjoy the right . . . to be confronted with the witnesses against him, [and] to have compulsory process for sustaining witnesses in his favor."[8] The extent to which a criminal defendant can cross-examine the witnesses testifying against him is controlled by the confrontation clause. The purpose of the clause is to provide an accused with an effective means of challenging the *381 evidence against him by testing the recollection and probing the conscience of an adverse witness. Ohio v. Roberts, 448 U.S. 56, 100 S.Ct. 2531, 65 L.Ed.2d 597 (1980). Nothing in this record indicates that appellant's rights under this specific clause have been violated. In the instant case, these proceedings were stayed after the Commonwealth presented all of its evidence. Appellant, prior to the stay order, did have full opportunity to confront and cross-examine all of the Commonwealth's witness during the case-in-chief. Thus, this constitutional protection has not been violated by the delay in trial.
Finally, appellant maintains that the extended delay in the resumption of trial has deprived her of due process protection found in the Fifth and Fourteenth Amendments that guarantee her the right to a fair trial. This argument, although general in nature, requires us to utilize the speedy trial analysis as articulated by United States Supreme Court in Barker v. Wingo, 407 U.S. 514, 92 S.Ct. 2182, 33 L.Ed.2d 101 (1972). In determining whether the right has been violated, a court should weigh four factors: "Length of delay, the reason for the delay, the defendant's assertion of his right, and prejudice to the defendant." Barker, id. at 530, 92 S.Ct. at 2192. Because "the right to a speedy trial is a more vague concept than other procedural rights", courts must "approach speedy trial cases on an ad hoc basis." Barker, id. at 521, 530, 92 S.Ct. at 2187, 2192.
In applying this four-part balancing test to determine whether the delays infringed upon appellant's right to a speedy trial, we proceed to analyze each of these factors as they pertain to the facts of appellant's case. First, all would concede that the length of the initial delay prompted by the Commonwealth's appeal of the demurrer order approximately six years, from the date of the trial court's stay order to the filing of appellant's motion to dismiss was lengthy and presumptively prejudicial, thus triggering this analysis. However, closely related to its length is the reason that would justify the delay, the second factor. Here, the Commonwealth's appeal from the sustaining of *382 appellant's demurrers was allowable under the well-established law of this Commonwealth applicable at that time. See, e.g., Commonwealth v. Wimberly, 488 Pa. at 172, 411 A.2d at 1194 citing Commonwealth v. Long, 467 Pa. 98, 354 A.2d 569 (1976); Commonwealth v. Simpson, 310 Pa. 380, 165 A. 498 (1933). It was not until the United States Supreme Court rendered its decision in this case that this practice was discontinued. Thus, the explanation for the delay was reasonable under existing law and the Commonwealth's decision to file a direct appeal can not be characterized as evincing a bad faith or dilatory purpose. See United States v. Loud Hawk, 474 U.S. 302, 106 S.Ct. 648, 88 L.Ed.2d 640 (1986).
The third factor to be considered is appellant's responsibility to assert her right to a speedy trial. While appellant did oppose the granting of the stay in open court at the hearing held on the matter, she did not subsequently challenge this stay order until the filing of her motion to dismiss the remaining charges. Stay orders are reviewable by the appropriate appellate courts. See generally Pa. R.A.P. 1501 et seq. and 1701 et seq. Appellant's decision not to challenge the stay by way of appellate review weighs against her position that she fully asserted her right to a speedy trial.
Last, the issue of prejudice to appellant must be viewed in terms of appellant's ability to receive a fair trial. As stated by the United States Supreme Court in Barker v. Wingo:
Prejudice, of course, should be assessed in the light of the interests of defendants which the speedy trial right was designed to protect. This Court has identified three such interests: (i) to prevent oppressive pretrial incarceration; (ii) to minimize anxiety and concern of the accused; and (iii) to limit the possibility that the defense will be impaired. Of these, the most serious is the last, because the inability of a defendant adequately to prepare his case skews the fairness of the entire system. If witnesses die or disappear during a delay, the prejudice is obvious. There is also prejudice if defense witnesses are unable to *383 recall accurately events of the distant past. Loss of memory, however, is not always reflected in the record because what has been forgotten can rarely be shown.
407 U.S. at 532, 92 S.Ct. at 2193 (citations omitted).
With respect to this factor of the balancing test, appellant offers nothing more than a general assertion of prejudice and fails to set forth any specific argument on this point. Rather, she merely points to the possibility of impairment of her ability to a fair trial given the voluminous testimony that the trial court would be required to judge. This "possibility of prejudice" is not sufficient to support appellant's position that her due process rights would be violated should her trial resume. It is significant to note that following oral argument on appellant's motion to dismiss the outstanding charges, and upon review of the record, the trial court ordered that the trial should continue. Implicit in this determination is its ability to further hear the case. The trial court, and not this Court, sits at the appropriate vantage point to make this decision and absent an abuse of discretion, it should not be disturbed. Therefore, without more than only a possibility of prejudice, this Court is unable to afford appellant the requested relief.
On the record before us we cannot hold that the delay in resuming appellant's trial on the remaining misdemeanor charges will deny her the right to a fair trial.
Accordingly, the order of the Superior Court is affirmed and the case is remanded to the Court of Common Pleas of Allegheny County for further proceedings.
It is so ordered.
ZAPPALA, J., files a dissenting opinion in which LARSEN, J., joins.
PAPADAKOS, J., files a dissenting opinion in which LARSEN, J., joins.
*384 ZAPPALA, Justice, dissenting.
The majority contends that the lengthy stay of the proceedings does not violate the principle of double jeopardy because there was neither a final judgment nor multiple prosecutions or punishments. For purposes of applying the double jeopardy concept, I perceive no distinction between multiple prosecutions and the piecemeal prosecutions afforded by the hiatus between the trial and the "continuation" of the trial in this case. The "continuance" in this case effectively terminated the trial what the Appellant now seeks is to prevent a second trial on the misdemeanor charges.
Article 1, § 10 of the Pennsylvania Constitution states, in relevant part, that "No person shall, for the same offense, be twice put in jeopardy of life or limb. . . ." The protection afforded under the double jeopardy clause seeks to ensure that an accused will not be subject to the harassment of successive trials. It is facetious to suggest that a trial on the misdemeanor charges would not be a successive trial. No final judgment on those charges was entered in 1980, but prosecution of those charges was certainly undertaken. Jeopardy attached in this case when the trial judge began to hear evidence.
There are varying circumstances that will call into play the double jeopardy clause, but this case presents only the very simplest of those. It is unnecessary to string cite cases, or engage in intellectual debate, to see that this factual scenario was exactly what Article 1, § 10 was intended to guard against.
The trial of the Appellant was terminated without a verdict on the misdemeanor charges when the Commonwealth appealed from the trial court's order sustaining the demurrer to several of the charges. This was not a mere "continuance"; nor is the second trial a "resumption" of the first. Whatever the practice in the Commonwealth may have been in November, 1980, the double jeopardy clause may not be reshaped to accommodate the Commonwealth's reliance on that practice. The double jeopardy clause protects *385 the accused. It may not be reinterpreted to protect the Commonwealth.
I need look no further than our own Constitution for the protections afforded to the Appellant and do not address the double jeopardy clause of the federal Constitution for that reason. I dissent.
LARSEN, J., joins in this Dissenting Opinion.
PAPADAKOS, Justice, dissenting.
I am convinced that the adjournment of the non-jury trial that occurred in this case, which, in turn, resulted in a ten-year break in the continuity of that trial (a substantial period of time by any standard), caused by repeated appeals instigated by the Commonwealth, is the functional equivalent of a mistrial in that it removed the immediacy of the threat to the defendant's liberty. It is, accordingly, an event that terminated jeopardy. Once jeopardy has ended, further proceedings directed at determining guilt or innocence, even the completion of an interrupted trial, are prohibited.
Jeopardy may be deemed to "continue" after the abortion of a trial only when that action was based on manifest necessity. The instant stay order was not; the Appellant-defendant (and her co-defendant) were willing to suffer the reinstatement of the murder charges to avoid the interruption of the trial. The prosecutor rejected this alternative.
Jeopardy exists when a trial is in some sense in progress, when some phase of the determination of guilt or innocence is taking place. I am persuaded that the constitutional provision that a defendant may not be "twice put" in this condition gives a defendant a right to reasonable continuity of the process by which guilt or innocence is determined. An indefinite adjournment that results in a ten year break in the continuity of the trial is an event terminating jeopardy and precludes retrial if it is ordered over the protest of the defendant (as here), in the absence of manifest necessity *386 (as here), and is caused by multiple appeals, instigated by the Commonwealth (as here).
The indefinite nature of the adjournment in this case and its resultant ten year delay distinguish this case from the handful of cases in other jurisdictions that have considered and rejected double jeopardy claims arising out of mid-trial continuances. The longest break involved in any such case appears to have been a 42-day adjournment (to a date certain) in a North Carolina juvenile proceeding. Matter of Hunt, 46 N.C.App. 732, 266 S.E.2d 385 (1980). A number of other cases have found shorter recesses to be inoffensive to the Double Jeopardy Clause. Webb v. Hutto, 720 F.2d 375, 379 (4th Cir.1983) (five days); State v. Sipe, 537 So.2d 178 (Fla.App.1989) (four weeks); State v. Poullard, 532 So.2d 327, 330 (La.App.1988) (two days); State v. Johnson, 529 So.2d 466 (La.App.1988) (two weeks); King v. State, 527 So.2d 641, 644 (Miss.1988) (six days); State v. Carter, 289 N.C. 35, 220 S.E.2d 313, 318 (1975) (seven days); Wortham v. State, 750 S.W.2d 326, 328 (Tex.App.1988) (seven days). See also, State v. Jackson, 485 So.2d 630 (La.App.1986) (recess of unspecified length held not to implicate Double Jeopardy Clause).
What these cases establish is that a defendant cannot demand perfect continuity of the trial process. They do not negate the existence of a right to reasonable continuity.
Two decisions have found double jeopardy to be violated following a recess in a non-jury trial. In State v. O'Keefe, 135 N.J.Super. 430, 343 A.2d 509 (1975), the prosecutor was granted a two-week recess so that he could obtain evidence without which his case was insufficient. The court found his neglect inexcusable and held that under such circumstances the continuance was an unreasonable break in the continuity of the trial, stating at 343 A.2d at 514:
A continuance differs from a mistrial-retrial in that it does not deprive the defendant of a verdict rendered by the original tribunal. Thus, a continuance protects the defendant's interest in securing an acquittal from a tribunal which has heard a weak State's case one basis for *387 the prohibition against double jeopardy. [Citations omitted.] Yet, double jeopardy has been invoked to prohibit a second prosecution even though the first jury heard no evidence before a mistrial was declared. [Citations omitted.]
Accordingly, a continuance might also violate the double jeopardy prohibition, for the essential element of double jeopardy is the oppressive harassment of a presumably innocent person attendant upon a repeated prosecution. There is not only the anxiety of a second trial, but the often greater anxiety in awaiting a second trial. This affects a defendant personally as well as in his relations with others.
Accord: Belveal v. Rambo, 487 P.2d 714 (Okl.Cr.App.1971).
The O'Keefe decision recognized that there are policy concerns underlying the Double Jeopardy Clause that go beyond the interest of the defendant in the identity of a tribunal or his interest against proceedings that allow a prosecutor an opportunity to improve on a previously presented case, and that a defendant's interest against protraction may be infringed even when the latter two interests are not.
The O'Keefe court was not alone in recognizing the interest against protraction that the Clause protects. In Arizona v. Washington, 434 U.S. 497, 98 S.Ct. 824, 54 L.Ed.2d 717 (1978), the United States Supreme Court stated:
[T]he constitutional protection also embraces the defendant's "valued right to have his trial completed by a particular tribunal." [Footnote omitted.] The reasons why this "valued right" merits constitutional protection are worthy of repetition. Even if the first trial is not completed, a second prosecution may be grossly unfair. It increases the financial and emotional burden on the accused, prolongs the period in which he is stigmatized by an unresolved accusation of wrongdoing, and may even enhance the risk that an innocent defendant may be convicted. The danger of such unfairness to the defendant exists whenever a trial is aborted before it is completed. *388 [Emphasis added; footnote omitted.] [Id. at 503-504, 98 S.Ct. at 829-30, 54 L.Ed.2d at 727.]
Similar observations appear in Green v. United States, 355 U.S. 184, 78 S.Ct. 221, 2 L.Ed.2d 199 (1957):
The underlying idea, one that is deeply ingrained in at least the Anglo-American system of jurisprudence, is that the State with all its resources and power should not be allowed to make repeated attempts to convict an individual for an alleged offense, thereby subjecting him to embarrassment, expenses and ordeal and compelling him to live in a continuing state of anxiety and insecurity, as well as enhancing the possibility that even though innocent he may be found guilty. [Emphasis added.] [Id. at 187-88, 78 S.Ct. at 223, 2 L.Ed.2d at 204.]
And, in United States v. Jorn, 400 U.S. 470, 91 S.Ct. 547, 27 L.Ed.2d 543 (1971), the Supreme Court stated:
Society's awareness of the heavy personal strain which a criminal trial represents for the individual defendant is manifested in the willingness to limit the Government to a single criminal proceeding to vindicate its very vital interest in enforcement of criminal laws. [Id. at 479, 91 S.Ct. at 554, 27 L.Ed.2d at 553 (1971)].
One commentator has suggested that the interest against protraction is the real interest underlying the interest in the identity of the tribunal:
A defendant has a valued right to have his trial completed by a particular tribunal, not because he has a constitutional interest in the identity of any particular tribunal, but because he has an interest in being able "to conclude his confrontation with society" [footnote omitted] once it has begun. Once a trial begins, a defendant has a legitimate interest in getting the trial over with "once and for all." [Footnote omitted.] It follows, therefore, that he also has an interest in continuing with "the first jury" [footnote omitted] impaneled in the case because changing the jury means interrupting the trial. To that extent, the defendant's interest in retaining the particular tribunal with which he began is merely an incident of *389 his primary interest in being able to complete the trial itself. [Westen and Drubel, Toward a General Theory of Double Jeopardy, 1978 Supreme Court Review 81, 90; emphasis added.]
While the U.S. Supreme Court has resisted any erosion of a defendant's interest in the identity of the tribunal, in Crist v. Bretz, 437 U.S. 28, 98 S.Ct. 2156, 57 L.Ed.2d 24 (1978), they made clear that the interest was not the only one protected by the Clause, stating:
[Double jeopardy] concerns the finality of judgments, the minimization of harassing exposure to the harrowing experience of a criminal trial, and the valued right to continue with the chosen jury have combined to produce the federal law that in a jury trial jeopardy attaches when the jury is empaneled and sworn. [Id. at 38, 98 S.Ct. at 2162, 57 L.Ed.2d at 33.]
I believe that the concerns protected by the Clause have a dignity of their own; it is not only those threatened proceedings that give a prosecutor a chance to improve a prior performance that subject a defendant to "embarrassment, expense and ordeal" and inflict a "continuing state of anxiety and insecurity" upon a defendant. A second jeopardy need not involve a different tribunal to be a "harrowing experience" and an occasion of "heavy personal strain." Nor is any special showing of a probability of the conviction of an innocent defendant required for a valid double jeopardy claim; we recognized in Commonwealth v. Bolden, 472 Pa. 602, 373 A.2d 90 (1977), the right involved is not only a right not to be convicted unjustly following the termination of the initial jeopardy but a right not to be tried at all.
The consequence of recognition of the double jeopardy implications of protracted recesses is not their absolute preclusion there may be occasions when a lengthy recess presents a reasonable alternative to an ordinary mistrial but their exposure to scrutiny for manifest necessity. Instantly, manifest necessity was non-existent. To the contrary, the ten-year delay here was caused by the Commonwealth's stubborn insistence on multiple appeals and proceedings *390 all to the detriment of Appellant's right to a prompt and speedy trial.
It will be remembered that the remaining charges here were stayed pending the Commonwealth's appeal of the order sustaining the demurrers. The Superior Court quashed the appeal and held that the principles of double jeopardy barred the Commonwealth from appealing an order sustaining a demurrer to the evidence. Commonwealth v. Smalis, 331 Pa.Superior Ct. 307, 480 A.2d 1046 (1984). The Commonwealth appealed to this Court and we reversed the Superior Court and remanded with instructions to the Superior Court to pass upon the merits of the demurrer ruling entered by the trial court. Commonwealth v. Zoller, 507 Pa. 344, 490 A.2d 394 (1985). Appellant petitioned the United States Supreme Court for a writ of certiorari, which was granted. The United States Supreme Court agreed with the Superior Court and held that the Commonwealth's initial appeal of the demurrers was barred by double jeopardy and reversed this Court. Smalis v. Pennsylvania, 476 U.S. 140, 106 S.Ct. 1745, 90 L.Ed.2d 116 (1986). In accordance with this mandate, we entered a per curiam order vacating our previous order and reinstating the order of the Superior Court which quashed the Commonwealth's appeal. Our per curiam order was filed on July 29, 1986; the trial in this case had commenced on or about November 12, 1980.
At this point, the Commonwealth sought to resume trial on the remaining charges of involuntary manslaughter, reckless endangerment, failure to prevent a catastrophe and theft by deception. Appellant filed a motion to dismiss these charges on double jeopardy, due process and confrontation clause grounds. The Superior Court, utilizing primarily a speedy trial analysis, affirmed the trial court's denial of the motion to dismiss and remanded the case to the trial court for further proceedings. This appeal followed.
The Commonwealth took a calculated gamble on appeal and delay and they lost. There was no manifest necessity *391 to this course of action. The Commonwealth cannot ignore the consequences for double jeopardy purposes of their freely chosen acts.
Moreover, the interest against multiple prosecutions may also be infringed (as here) by permitting a trial to be bifurcated by an appeal. In United States v. Jaramillo, 510 F.2d 808 (8th Cir.1975), the court stated:
[Resumption of the nonjury trial] would subject the appellees to the same hazards incurred in a second trial that are clearly prohibited by the double jeopardy clause. The remand would provide the government with another chance to convict the appellees by exhaustively reviewing the record, marshaling the facts and rearguing the case in a manner not previously presented. The appellees would be put to further expense, ordeal, and anxiety. [Id. at 812; emphasis added.]
While it might be argued that applying the double jeopardy clause here would be retroactive and hence unfair to the Commonwealth because the Commonwealth relied on a procedure presumably valid at the time, that argument should be rejected. The cases dealing with issues of retroactive application of double jeopardy law have consistently held double jeopardy decisions to be retroactive notwithstanding prosecutorial reliance on prior standards. Robinson v. Neil, 409 U.S. 505, 93 S.Ct. 876, 35 L.Ed.2d 29 (1973); Vogel v. Commonwealth of Pennsylvania, 790 F.2d 368 (3rd Cir.1986); Commonwealth v. Richbourg, 442 Pa. 147, 275 A.2d 345 (1971).
In short, I have concluded that constitutional standards enunciated under the Double Jeopardy Clause preclude further proceedings in this case. Simply because the instant facts do not fit neatly into previously existing categories is no reason not to find a constitutional violation where fundamental constitutional policies are impinged. The delay here was too long to allow us in any but a mechanical and overly technical way to conclude that initial jeopardy continued. The facts speak otherwise. It would be patently unfair to subject Appellant to further trial at this point.
*392 The unfairness of subjecting Appellant to further trial here also, it seems to me, rises to the level of a due process violation by violating the Confrontation Clause of the Fifth Amendment. See, Commonwealth v. Zoller, 507 Pa. 344, 490 A.2d 394 (1985). The issue of the effect of the lapse of time on the ability of the factfinder to decide the case on the basis that the Constitution contemplates that is to say, on live testimony has been ignored by the majority.
This court previously held that the action of a defendant in demurring to the evidence was an "election" that removed any double jeopardy barrier to further proceedings, Commonwealth v. Zoller, supra, but nonetheless we rejected the suggestion that resumption of trial was an appropriate procedure, and remanded the companion case, which was also non-jury, for a new trial, stating:
We . . . stated in [Wimberly, supra] that "[i]n those cases where this Court has concluded that a demurrer was granted in error, we have remanded for a new trial." Id.
Accordingly, we reverse the Superior Court and remand Commonwealth v. Zoller, supra, where it was determined that the demurrer was granted in error, for a new trial. With regards to Commonwealth v. Smalis, supra, we remand to the Superior Court to pass upon the merits of the demurrer ruling entered by the trial court. [Id. at 359, 490 A.2d at 402; footnote omitted.]
It is implicit from the foregoing that this Court found resumption of a non-jury trial after a "recess" for an appeal objectionable for some reason independent of double jeopardy considerations, and Appellant cogently argues that the reason is that this Court recognized that the Confrontation Clause contemplates that a verdict will be rendered at a time when the confrontation it promises the defendant will be fresh in the mind of the factfinder, and does not countenance a separation of several years between the confrontation and the deliberations that produce the verdict. In Jaramillo, supra, the court, after holding that the resumption proposed there was as offensive to the Double Jeopardy *393 Clause as retrial, went on to point out that resumption would impair other constitutionally protected interests of the defendant:
Even if the same trial judge were available on remand, there is nothing to assure that the passage of time and the resultant dimming of the memory will not adversely affect the rights of the appellees. [Id. at 512.]
The concerns expressed by the Jaramillo court are at least equally applicable to the instant case, particularly since this case involved 53 witnesses whose testimony consumed some 2,000 transcript pages over a period of four weeks. A conviction based on a record as voluminous and as stale as the instant one would deprive Appellant of due process of law.
I would dismiss the remaining charges against Appellant.
LARSEN, J., joins this Dissenting Opinion.
NOTES
[1] 18 Pa.C.S. § 2501.
[2] 18 Pa.C.S. § 2705.
[3] 18 Pa.C.S. § 3302(a).
[4] 18 Pa.C.S. § 3303.
[5] 18 Pa.C.S. § 4114.
[6] The Fifth Amendment of the United States Constitution provides, in pertinent part, that "No person shall be . . . subject for the same offense to be twice put in jeopardy of life or limb; . . ." Through the Fourteenth Amendment, this provision is applicable to the States. Benton v. Maryland, 395 U.S. 784, 89 S.Ct. 2056, 23 L.Ed.2d 707 (1969).
[7] Before this Court, the case was consolidated with another case pertaining to the same double jeopardy issue. Commonwealth v. Zoller, 318 Pa.Super. 402, 465 A.2d 16 (1983).
[8] United States Constitution, Amend. VI. The Pennsylvania Constitution guarantees an accused the right to "meet the witnesses face to face." Pennsylvania Constitution, Art. 1, § 9.
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950 F.2d 726
Ray-Carroll County Grain Growersv.Norfolk & Western Railway
NO. 90-2712
United States Court of Appeals,Eighth Circuit.
SEP 19, 1991
1
Appeal From: E.D.Mo.
2
AFFIRMED.
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815 F.2d 78
Unpublished DispositionNOTICE: Sixth Circuit Rule 24(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Sixth Circuit.Dwight MATTHEWS, Plaintiff-Appellant,v.John TAYLOR, Herman C. Davis, Ross Bates, Linda Cutlip,Maggie Peat, and Philip Glenn, Defendants-Appellees.
No. 86-5476.
United States Court of Appeals, Sixth Circuit.
Feb. 12, 1987.
Before MERRITT and MILBURN, Circuit Judges, and PECK, Senior Circuit Judge.
ORDER
1
This matter has been referred to a panel of the Court pursuant to Rule 9(a), Rules of the Sixth Circuit. After an examination of the record and the briefs, this panel agrees unanimously that oral argument is not needed. Rule 34(a), Federal Rules of Appellate Procedure.
2
This pro se plaintiff appeals from the district court order granting summary judgment to the defendants, thereby dismissing plaintiff's Sec. 1983 complaint.
3
Plaintiff, who is an inmate at Fort Pillow State Prison, asserts that the defendants, six correctional employees, violated his fourth and fourteenth amendment rights. Plaintiff basically presents the following two claims: 1) that the defendants violated his fourth amendment rights by searching his mattress, in which a gun was found, outside of his presence; and 2) that his fourteenth amendment rights were violated because he was not given adequate, substantive and procedural due process by the Institutional Review Board (IRB), which convicted plaintiff of possession of a deadly weapon, resulting in a sentence of twenty days in punitive segregation.
4
The district court correctly decided to grant defendants' motion for summary judgment. Upon review of the record and briefs on appeal, there is no evidence of a genuine issue as to any material fact and the defendants are entitled to a judgment as a matter of law. See Gress v. Allen-Bradley Co., 801 F.2d 859, 861 (6th Cir.1986).
5
The district court also correctly held that there was no fourth amendment search and seizure violation because prisoners have no reasonable expectation of privacy in their cells and thus cannot invoke the protections of the Fourth Amendment. See Hudson v. Palmer, 468 U.S. 517 (1984).
6
The plaintiff presents no evidence to refute defendants' assertions in their motion for summary judgment that they adhered to the procedural due process requirements to be followed when a prison disciplinary hearing is held, as enunciated in Wolff v. McDonnell, 418 U.S. 539 (1974). Thus, the district court correctly held that not procedural due process violation occurred.
7
Finally, plaintiff's claim that the IRB found him guilty without substantive due process is not well taken. The uncontroverted evidence is that a gun was found in plaintiff's mattress. The fact that the IRB did not believe plaintiff's testimony that the gun had been planted by another inmate does not rise to the level of a constitutional violation. Moreover, the IRB factual findings are not subject to second guessing upon review. Superintendent, Massachusetts Correctional Institution at Walpole v. Hill, 472 U.S. 455 (1985).
8
Therefore, the district court's judgment is hereby affirmed pursuant to Rule 9(d)(3), Rules of the Sixth Circuit.
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622 N.E.2d 484 (1993)
In the matter of Theresa M. Heamon.
No. 20S00-9106-DI-425.
Supreme Court of Indiana.
October 21, 1993.
*485 John Roper, South Bend, for respondent.
Jeffrey D. Todd, Staff Atty., Indianapolis, for The Indiana Supreme Court Disciplinary Com'n.
PER CURIAM.
The Respondent, Theresa M. Heamon, was charged in a three-count Amended Verified Complaint for Disciplinary Action with several violations of the Rules of Professional Conduct for Attorneys at Law. A hearing officer appointed pursuant to Admission and Discipline Rule 23 heard the evidence and tendered his findings of fact and conclusions of law, finding violations of the Rules of Professional Conduct under the first two counts, and dismissing the third count. Respondent petitioned for review, challenging the hearing officer's findings and conclusions as to Count I. The parties have fully briefed their positions.
This Court's review of disciplinary cases is de novo, and we examine all matters presented. Matter of Young (1989), Ind., 546 N.E.2d 819. Our review encompasses the hearing officer's report as well as the entire record tendered in the case. The hearing officer's findings and conclusions, being products of direct observation of witnesses, are correspondingly afforded emphasis. Matter of Smith (1991), Ind., 588 N.E.2d 1268. However, this Court remains the ultimate factfinder and arbiter of misconduct and sanction. Matter of Levinson (1992), Ind., 604 N.E.2d 599; Matter of Smith (1991), Ind., 579 N.E.2d 450. To support a finding of misconduct, this Court must be satisfied that such is based on clear and convincing evidence. Matter of Oliver (1986), Ind., 493 N.E.2d 1237. Respondent's objections to the hearing officer's findings and conclusions will be resolved within the context of this review process.
Count I.
Upon review of all matters submitted before us, this Court finds that, at all times relevant to the incidents herein, Respondent was a part-time public defender and also maintained a private law practice in Elkhart, Indiana.
On October 30, 1989, Respondent agreed to represent Brenda Burris Hout ("Burris") in the dissolution of her marriage. Initially, Respondent set her fee at $350.00, plus $47.00 for filing costs. However, the record reflects dispute as to the fee ultimately agreed upon. The hearing officer concluded that a fee of $250.00 plus filing costs was agreed to after Respondent learned there were no contested matters between Burris and her husband.
At the end of their October 30 meeting, Burris paid Respondent $46.00, and received from Respondent a receipt evidencing payment and indicating a $251.00 balance due. On November 6, 1989, Burris signed a dissolution petition Respondent had prepared, paid Respondent $251.00, and received a receipt evidencing payment and indicating no further balance due. Respondent told Burris that she would file the *486 petition in the appropriate Michigan court the following Monday and that the marriage could be dissolved as soon as 60 days after the filing date.
On December 1, 1989, Burris became concerned after learning her husband had not received service of the dissolution petition. She telephoned Respondent at her private office, leaving a message on the answering machine requesting a return call. Respondent failed to return the call. During the next several weeks, Burris attempted repeatedly, and without success, to reach Respondent by telephone at her private practice. She tried once to reach Respondent at the public defender's office.
In December, 1989, Burris contacted Lois Thompson, a paralegal, and told her of her difficulty in contacting Respondent. Thompson agreed to try to contact Respondent and left a message on Respondent's answering machine in early January, 1990. Respondent returned the call, and, according to Thompson, indicated that the petition had been filed and that she would telephone Burris the following day. Burris waited for a call from Respondent, but none came. Respondent testified that she tried unsuccessfully to reach Burris by telephone several times after speaking to Thompson.
On January 15, 1990, Burris left a message on Respondent's answering machine indicating that she no longer desired Respondent's services and demanding return of the fees she had paid. Respondent failed to return the call or refund any portion of the fees. Respondent never filed a petition for dissolution on behalf of Burris.
At hearing, Respondent testified that she contacted Burris by telephone on November 30, 1989, after realizing that Burris's November 6, 1989 payment of $251.00 did not satisfy the entire fee. Respondent testified that she informed Burris that her fee was $350.00. Respondent further testified that she never agreed to a fee of $250.00, and that her acceptance of the November 6 payment as settling the account was an error. She contends that on November 30, 1989, she in good faith believed she could abandon her contract with Burris since she thought Burris owed her an additional $100.00. She, therefore, asserts her representation of Burris ended on November 30, 1989. The hearing officer heard the conflicting testimony regarding the amount of agreed fee, weighed the various factors, and concluded that Respondent failed to act with reasonable diligence and promptness in violation of Ind.Professional Conduct Rule 1.3. The hearing officer's assessment of the evidence and his judgment in reconciling conflicting testimony carries great weight. Matter of Kern (1990), Ind., 555 N.E.2d 479. We are further persuaded by the fact that Respondent gave Burris two receipts on two separate occasions indicating Respondent's fee was $250.00. This evidence convinces us that the agreed fee was $250.00. Respondent had no reason to abandon representation and therefore had a continuing duty to exercise reasonable diligence in representing her client. The record reveals a complete lack of action on the part of Respondent during her representation of Burris. We thus conclude that Respondent's conduct violated Prof. Cond.R. 1.3.
Respondent also contends that she did not violate Prof.Cond.R. 1.4(a) by failing to keep Burris reasonably informed about the status of her case because Burris could have contacted her at the public defender's office. Burris testified that despite the many messages she left on Respondent's answering machine during several weeks in December of 1989, Respondent never returned her calls. Her testimony is supported by the fact that she contacted paralegal Thompson in another attempt to make contact with Respondent. The evidence clearly indicates Respondent consistently failed to respond to her client's requests for information. We conclude that the findings under this count establish that Respondent violated Prof.Cond.R. 1.4(a) by failing to keep her client informed about her pending case.
Respondent asserts that she worked five and one-half (5-1/2) hours on Burris's dissolution at $90.00 per hour and that no refund was due. We find this assertion unpersuasive. Respondent agreed to represent *487 Burris for $250.00. Respondent did not satisfy the agreement; she did not even file the initial petition. The evidence is clear and convincing that Respondent violated Prof.Cond.R. 1.16(d) in that she failed to refund advance payment of fees that were not earned.
Respondent also challenges the hearing officer's conclusion that she engaged in conduct involving dishonesty, deceit and misrepresentation in violation of Prof. Cond.R. 8.4(c). We find to the contrary. The Respondent lied to her client and to Thompson, indicating to the former that the petition would be filed, and indicating to the latter that it had been filed. The findings establish conclusively that Respondent violated Prof.Cond.R. 8.4(c).
Finally, we also find that Respondent's consistent failure to act on behalf of her client and general neglect of her duties to her client was prejudicial to the orderly administration of justice, and, therefore, violated Prof.Cond.R. 8.4(d). Her disregard of her duties and the interests entrusted to her reflects poorly on the legal system and frustrates the orderly administration of justice.
Count II.
Because the Respondent has not challenged the hearing officer's findings of fact as to Count II, we accept and adopt those findings. Matter of Vogler (1992), Ind., 587 N.E.2d 678. Those facts are as follow: On May 30, 1989, Valerie Sharif ("Sharif") discussed with Respondent the filing of a dissolution. Respondent advised Sharif her fee would be $350.00 plus $55.00 for filing costs. On June 13, 1989, Respondent informed Sharif by letter that she could come to her office on June 19 to sign the dissolution petition Respondent had prepared.
Sharif signed the petition, and they agreed on a total fee of $405.00. Respondent then informed Sharif that the dissolution would be finalized around August, 1989.
Sharif attempted to contact Respondent through July and most of August of 1989. In late August, 1989, Sharif spoke with Respondent, at which time Respondent told her that the dissolution was proceeding more slowly than anticipated. Respondent indicated that the matter would be "before the court" in early October, 1989.
Sharif's attempts to contact Respondent during September and October were unsuccessful. Respondent telephoned Sharif in late November and apologized for neglecting her case. She then told Sharif that the dissolution would be complete before the end of 1989.
Attempts by Sharif to contact Respondent late in 1989 failed. On January 15, 1990, Sharif left a message on Respondent's answering machine indicating she desired to terminate Respondent's services. Sharif also demanded a refund of the fees she had paid, which Respondent eventually refunded. Respondent never filed the dissolution petition, nor did she take other significant action in furtherance of the dissolution.
The findings clearly and convincingly establish that Respondent violated Prof. Cond.R. 1.3. Aside from drafting the petition, there is no evidence of Respondent having taken significant action from the end of May, 1989, until her termination in early 1990. Respondent at one point even apologized to Sharif for neglecting her case. The evidence also reflects that Respondent failed to keep her client reasonably informed about the status of her case, in violation of Prof.Cond.R. 1.4(a). Despite her attempts, Sharif was unable to learn the status of her case during July and most of August, September and October, and during a significant period late in 1989. This pattern of consistent neglect on Respondent's part involves the possibility of extreme prejudice to her client. Finally, we again find that Respondent's consistent failure to act on behalf of her client and general neglect of her duties to her client was prejudicial to the orderly administration of justice, in violation of Prof.Cond.R. 8.4(d).
We find no evidence to support a conclusion that Respondent violated Prof.Cond.R. 8.4(a), (b), or (c), as charged in the complaint, and therefore agree with the hearing *488 officer's conclusion that no such violation took place.
Count III.
The allegations in Count III stem from Respondent's representation of Carlos Espinoza ("Espinoza") in 1988 and 1989 in an attempt to have his driving privileges restored. Respondent was charged with violating Prof.Cond.R. 1.3, 1.4(a), and 1.5(a) in connection with this representation.
The hearing officer found that during the course of the representation, Respondent diligently researched and investigated Espinoza's case and kept him reasonably informed as to the status of the matter. The hearing officer, therefore, concluded that there was not clear and convincing evidence of misconduct to support allegations contained in Count III.
We agree with the hearing officer's findings as to Count III and therefore find no misconduct as to that count.
It is now the duty of this Court to assess an appropriate disciplinary sanction. In doing so, we examine several factors: the nature of the offense, the state of mind of the Respondent, actual or potential injury, the duty of this Court to preserve the integrity of the profession, the risk to the public, and matters in mitigation or aggravation. Matter of Cawley, Jr. (1992), Ind., 602 N.E.2d 1022.
Respondent has demonstrated an alarming propensity to neglect the duties entrusted to her by her clients. Although we do not believe that Respondent acted with a conscious objective or purpose to achieve the particular results, her actions were for the most part predicated on a conscious awareness of the attendant circumstances of her conduct.[1] Although this is a less culpable state of mind, it still demonstrates a recklessness and dereliction of professional duty that cannot be tolerated. Such conduct impacts negatively on the profession as a whole and serves to damage an integrity a majority of practitioners strive to uphold. Public trust and confidence in the legal profession suffers as a result of the conduct demonstrated by Respondent.
Under these circumstances, we find that a period of suspension with automatic reinstatement upon showing of restitution appropriately addresses the severity of the offense. It is, therefore, ordered that the Respondent, Theresa M. Heamon, is suspended from the practice of law for a period of ninety (90) days, at the expiration of which she shall be automatically reinstated upon her showing to the satisfaction of the Disciplinary Commission that she has made restitution of all fees. This suspension is effective November 22, 1993.
Costs of this proceeding are assessed against the Respondent.
NOTES
[1] See American Bar Association Model Standards for Imposing Lawyer Sanction, Theoretical Framework, listing a hierarchy of mental states underlying action and corresponding levels of culpability.
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16 Neb. App. 651
STATE OF NEBRASKA, APPELLEE,
v.
RANDY L. ANDERSEN, APPELLANT.
No. A-07-547.
Court of Appeals of Nebraska.
Filed April 29, 2008.
Andrew J. Wilson and Kylie A. Wolf, of Walentine, O'Toole, McQuillan & Gordon, for appellant.
Jon Bruning, Attorney General, and Stacy M. Foust for appellee.
SIEVERS, CARLSON, and MOORE, Judges.
CARLSON, Judge.
INTRODUCTION
Randy L. Andersen (defendant) pled no contest to count I, a charge of motor vehicle homicide by reckless/willful reckless driving, a Class IIIA felony. The district court sentenced defendant to 5 to 5 years' imprisonment and ordered him not to drive a motor vehicle for a period of 15 years. Defendant appeals, claiming that the plea was not voluntary and that the sentence was excessive.
FACTUAL BACKGROUND
Based on a plea bargain, defendant pled no contest to motor vehicle homicide by reckless/willful reckless driving, a Class IIIA felony, on February 23, 2007. As a part of the plea agreement, the State dismissed count II, a charge of assault in the second degree, a Class IIIA felony, and agreed not to file 10 violations of a protection order, second offense, all Class IV felonies. After the plea hearing, the court adjudged defendant guilty of motor vehicle homicide by reckless/willful reckless driving and sentenced defendant to 5 to 5 years' imprisonment and a license revocation of 15 years. Defendant appeals.
The relevant facts in regard to defendant's plea and sentence will be addressed in detail in the analysis section of this opinion.
ASSIGNMENTS OF ERROR
Defendant cites two errors in his brief as follows: "[Defendant's] plea of no contest was not made knowingly, voluntarily and intelligently. . . . The sentence imposed by the lower court is excessive."
STANDARD OF REVIEW
[1] A trial court is given discretion as to whether to accept a guilty plea; an appellate court will overturn that decision only where there is an abuse of discretion. State v. Lassek, 272 Neb. 523, 723 N.W.2d 320 (2006).
[2] A sentence imposed within statutory limits will not be disturbed on appeal absent an abuse of discretion by the trial court. State v. Fester, 274 Neb. 786, 743 N.W.2d 380 (2008).
[3] An abuse of discretion occurs when a trial court's decision is based upon reasons that are untenable or unreasonable or if its action is clearly against justice or conscience, reason, and evidence. State v. Archie, 273 Neb. 612, 733 N.W.2d 513 (2007).
[4] Plain error may be found on appeal when an error unasserted or uncomplained of at trial, but plainly evident from the record, prejudicially affects a litigant's substantial right and, if uncorrected, would result in damage to the integrity, reputation, and fairness of the judicial process. State v. Mlynarik, 16 Neb. App. 324, 743 N.W.2d 778 (2008).
ANALYSIS
Plea.
Defendant entered a plea of no contest and was adjudged guilty by the district court of motor vehicle homicide by reckless/willful reckless driving pursuant to Neb. Rev. Stat. § 28-306(3)(a) (Cum. Supp. 2004). Defendant alleges, in his first error, that his plea of no contest was not done freely, intelligently, voluntarily, and understandingly.
[5,6] The requirements of such a plea were reiterated in the case of State v. Lassek, supra, wherein it was pointed out that a plea of no contest is equivalent to a plea of guilty. To support a finding that a plea of guilty has been entered freely, intelligently, voluntarily, and understandingly, a court must inform the defendant concerning (1) the nature of the charge, (2) the right to assistance of counsel, (3) the right to confront witnesses against the defendant, (4) the right to a jury trial, and (5) the privilege against self-incrimination. The record must also establish a factual basis for the plea and that the defendant knew the range of penalties for the crime charged. Id. A trial court is given discretion as to whether to accept a guilty plea; an appellate court will overturn that decision only where there is an abuse of discretion. Id. With these parameters and guidelines in mind, we turn to the record to determine whether defendant was adequately informed of his rights, whether he knew the range of penalties, and whether there was a factual basis for the plea.
The thrust of defendant's argument is that in his mind, the offense should have been a misdemeanor instead of a felony and that he should have gotten some type of a preagreement on his sentence. The record is not supportive of defendant's argument.
The following excerpts from the record highlight some of defendant's complaints but show the plea herein was made freely, intelligently, voluntarily, and understandingly.
THE COURT: . . . [Y]ou've had an opportunity to talk to your attorney. What is it you wish to do at this time?
THE DEFENDANT: I'm not going to waste the Court's time, never have, never will. I'm going to plead no contest.
THE COURT: To Count I?
[Counsel for defendant]: Count I.
THE COURT: I take it pursuant to the plea agreement that was mentioned when we started where the State would dismiss Count II and not file on ten counts of violation of a protection order?
[Counsel for defendant]: That's correct.
THE COURT: Okay. Is that your understanding . . . ? THE DEFENDANT: Yes.
THE COURT: Okay. And is a no contest plea acceptable to the State?
[Counsel for the State]: Yes.
THE COURT: Do you understand . . . that a no contest plea will be treated the same as a plea of guilty as far as sentencing goes?
THE DEFENDANT: Yeah.
THE COURT: Is that a yes?
THE DEFENDANT: Yes.
. . . .
THE COURT: Do you understand the maximum possible penalty for this charge is five years in jail and a $10,000 fine? The Court doesn't have to put you in jail for five years. It could be a day on up, and the Court doesn't have to fine you $10,000. It could be a dollar on up. Do you understand?
THE DEFENDANT: Yes.
THE COURT: Has anybody told you or led you to believe that by entering your plea of no contest you would receive probation, be given a light sentence or in any way rewarded for pleading no contest?
THE DEFENDANT: (No audible answer.)
THE COURT: Has anybody told you what's going to happen?
THE DEFENDANT: (No audible answer.)
THE COURT: There's been discussion of what you would like to happen, but has anybody told you what your sentence is going to be?
THE DEFENDANT: (No audible answer.)
THE COURT: Did your attorney tell you what your sentence was going to be?
THE DEFENDANT: No.
THE COURT: Did anybody else tell you what your sentence would be? Nobody's told you you're going to get the minimum and nobody told you you're not going to get the maximum, is that correct, or any specific number as far as jail time?
THE DEFENDANT: I was told in November I was going to get 20 to 30 months time served.
THE COURT: Who told you that?
THE DEFENDANT: It was a plea thing that the lawyer told me, but no.
THE COURT. Okay.
[Counsel for defendant]: As his attorney, I have told him that's what I would ask for. As we have discussed
THE DEFENDANT: Until these letters came up.
[Counsel for defendant]: many times, that is not part of the plea deal. It's been one of the frustrations [defendant] has expressed with me, is that he wants the sentence guaranteed, and I've expressed to him
THE DEFENDANT: I said I wanted it in writing. [Counsel for defendant]: And I said it was not guaranteed.
THE DEFENDANT: That was in November.
THE COURT: Do you understand that what your attorney tells you, you know, is something that is recommended to the Court under the circumstances, but the Court is not bound by that?
THE DEFENDANT: Yeah, I was told that today.
THE COURT: All right. All right. You're still willing to proceed?
THE DEFENDANT: I'm done with this. I want it over with.
. . . .
THE COURT: Okay. The charge, Count I, is that on or about the 26th day of November, 2005, in Douglas County, you unintentionally caused the death of Jay Hinchman.
[Counsel for the State]: Hinchman.
THE COURT: Jay Hinchman, while engaged in the unlawful operation of a motor vehicle and in violation of Section [6]0-6,213 or Section 60-6,214.
THE DEFENDANT: What's those sections for? [Counsel for the State]: That would be reckless and willful reckless driving.
THE COURT: Either reckless or willful reckless driving. That's what you're charged under.
THE DEFENDANT: Which is one or willful, one, disregard for human life, conscious or deliberate is substates and counties.
THE COURT: Well, that's the charge as set out. Do you still wish to plead no contest to that charge?
THE DEFENDANT: I have no choice, yes.
THE COURT: Well, you can say, no, I don't want to and, you know
THE DEFENDANT: And we wait another year? No, I don't want to wait another year.
THE COURT: Before I can accept your plea, I have to be satisfied there's a factual basis for the charge. Is the State going to give the factual basis?
[Counsel for the State]: On November 26th, 2005, here in Douglas County, Nebraska, the defendant was operating a motor vehicle and turned onto Farnam Street heading the wrong way on a one-way street. The defendant then struck a car being driven by the victim, Jay Hinchman, at approximately 33rd Street and Farnam Street, which caused the car driven by Mr. Hinchman to spin 180 degrees and strike a guardrail. According to the coroner's excuse me, the medical examiner's report, Mr. Hinchman died as a result of the injuries sustained in that accident.
The defendant did show some signs of alcohol impairment to Omaha police officers following a legal blood draw, his BAC tested at a 0.61. There was also the presence of marijuana in his urine. All those events occurred here in Douglas County, Nebraska.
THE COURT: Do you believe that [defendant's] plea of no contest is consistent with the law the facts and in his best interests?
[Counsel for defendant]: Yes.
THE COURT: All right. . . . [T]he Court finds beyond a reasonable doubt that you understand the nature of the charge against you to which you pled no contest to; that you understand the possible penalties; that your plea is entered freely, knowingly, intelligently; that there is a factual basis for your plea. The Court grants you leave to withdraw your previously entered plea of not guilty, accepts your plea of no contest, finds and adjudges you guilty of the charge. The matter will be referred for a Presentence investigation.
Based on a careful review of the total record, we find no abuse of discretion and that this error has no merit. We agree with the summation of the State in its brief that defendant's arguments are founded upon comments made by him which have been taken out of the context of the entire plea hearing. The fact that defendant did not agree with the evidence, whether he should be charged with a misdemeanor or felony, and what his final sentence should be does not change that his plea was made freely, intelligently, voluntarily, and understandingly. The district court explained to him that he would be pleading no contest to a felony and that his sentence would be within the discretion of the court despite the recommendations of counsel.
Excessive Sentence.
[7] The district court sentenced defendant to 5 to 5 years' imprisonment based on his plea to count I, motor vehicle homicide by reckless/willful reckless driving, a Class IIIA felony. Count I was punishable by up to 5 years' imprisonment, a $10,000 fine, or any combination of the two. Neb. Rev. Stat. § 28-105 (Cum. Supp. 2006). The standard of review in regard to sentencing is whether the sentence was within the statutory limits and whether the sentencing court abused its discretion. See, State v. Fester, 274 Neb. 786, 743 N.W.2d 380 (2008); State v. Archie, 273 Neb. 612, 733 N.W.2d 513 (2007).
It is clear that the sentence was within the statutory limitations. Defendant argues that although he has had a troubled past, he has made efforts to take control of his admitted drinking problem. In response, the State points to defendant's extensive criminal history (six pages in the presentence investigation report). Defendant has been convicted of multiple counts of driving during suspension, driving under the influence, and possession of less than 1 ounce of marijuana, among many other convictions. He has a previous felony conviction for the offense of felony criminal mischief in which he was sentenced to an imprisonment of 30 to 60 months. It should be noted that defendant benefited from a plea bargain in which the prosecutor dismissed and agreed not to file 11 felony charges.
[8-10] When imposing a sentence, a sentencing judge should consider the defendant's (1) age, (2) mentality, (3) education and experience, (4) social and cultural background, (5) past criminal record or record of law-abiding conduct, and (6) motivation for the offense, as well as (7) the nature of the offense, and (8) the amount of violence involved in the commission of the crime. State v. Fester, supra. We have further held that, in considering a sentence to be imposed, the sentencing court is not limited in its discretion to any mathematically applied set of factors. Id. Obviously, depending on the circumstances of a particular case, not all factors are placed on a scale and weighed in equal proportion. The appropriateness of a sentence is necessarily a subjective judgment and includes the sentencing judge's observation of the defendant's demeanor and attitude and all facts and circumstances surrounding the crime and the defendant's life. Id.
Based on the criteria set in the law, we find no support for the argument that the court abused its discretion in defendant's sentence of imprisonment.
Plain Error.
As a part of defendant's sentence, the court suspended defendant's driver's license for a period of 15 years. The State has conceded that the district court erred in imposing any time period of license revocation for defendant under the statute to which he pled and was found guilty. It is clear that the statute, § 28-306(3)(a), contains no provision for a license revocation. The portion of § 28-306(3)(a) in question simply reads as follows: "If the proximate cause of the death of another is the operation of a motor vehicle in violation of section 60-6,213 or 60-6,214, motor vehicle homicide is a Class IIIA felony." Neb. Rev. Stat. §§ 60-6,213 and 60-6,214 (Reissue 2004) refer to the statutes on reckless and willful reckless driving, respectively. These statutes have no penalty provisions.
[11] We find that under the present state of Nebraska law, a conviction of the above provision, motor vehicle homicide by reckless/willful reckless driving, does not give the sentencing court any authority to order a license revocation. As a result, we find plain error and vacate that portion of defendant's sentence that ordered defendant not to operate a motor vehicle for a period of 15 years. Plain error may be found on appeal when an error unasserted or uncomplained of at trial, but plainly evident from the record, prejudicially affects a litigant's substantial right and, if uncorrected, would result in damage to the integrity, reputation, and fairness of the judicial process. State v. Mlynarik, ante p. 324, 743 N.W.2d 778 (2008).
CONCLUSION
We therefore affirm the district court's judgment in all respects, except that we modify the sentencing order in regard to the license revocation.
AFFIRMED AS MODIFIED.
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653 F.2d 239
108 L.R.R.M. (BNA) 2410, 92 Lab.Cas. P 13,005
NATIONAL LABOR RELATIONS BOARD, Petitioner,v.MIDLAND ROSS, INC., Respondent.
Nos. 79-1175, 79-1553.
United States Court of Appeals,Sixth Circuit.
Jan. 8, 1981.
Elliott Moore, Deputy Associate Gen. Counsel, Steven Fetter, N. L. R. B., Washington, D. C., Emil C. Farkas, Director, Region 9, N. L. R. B., Cincinnati, Ohio, for petitioner.
Asa Ambrister, Gardner, Ambrister & Smith, Nashville, Tenn., George V. Gardner, Washington, D. C., for respondent.
Before WEICK, KEITH and KENNEDY, Circuit Judges.
ORDER
1
The National Labor Relations Board petitions for enforcement of two orders issued by the Board, one finding that defendant violated Sections 8(a)(3) and (1) of the National Labor Relations Act by discriminatorily terminating employee Earl A. Rose for engaging in union activities; the second finding that defendant violated Section 8(a)(5) and (1) of the National Labor Relations Act by refusing to bargain with the certified union.1 Both cases have been consolidated on appeal.
2
Midland Ross is an Ohio corporation, engaged at its Louisville, Kentucky facility in the business of warehousing and distributing plastic products. Earl Rose was hired in January, 1975, to work in the Louisville warehouse along with three other employees. In July, 1976, John Schneider, was hired as supervisor and plant manager and charged with making the warehouse run more smoothly and efficiently. Sometime in the fall of 1976, Schneider and Gerald Ose, Director of Marketing for the Material Handling Division, discussed reducing the number of warehouse personnel by one. The proposed budget for 1977 dated January, 1977, showed three instead of four warehousemen. The reduction was scheduled for implementation sometime in the second quarter of 1977. As the warehouseman with the least seniority, Rose would be the employee terminated.
3
On March 14, 1977, Schneider completed a mortgage reference form for Rose answering the question "probability of continued employment" as "Good." About a week later, Dave Collier, the lead warehouseman, told Rose and two of the other warehouse employees that they were suspended for three days for tampering with another employee's time cards in violation of company rule 12. They appealed to Schneider at which time Rose remarked, "If we had a union in here, this kind of stuff wouldn't happen." Schneider reduced the suspension from three days to the balance of that afternoon.
4
On March 24, Ose sent Schneider a memo asking how the plan for reducing the warehouse employees by one was going.
5
Following the time card incident, Rose discussed organizing with two other warehousemen, Wood and Downs. Rose contacted, and arranged a meeting with the assistant to the president of Local 89. Subsequent to this meeting, Rose passed out authorization cards at work where they were completed. The cards were signed on March 28, 1977. Schneider was notified three days later of the union's demand for recognition.
6
On April 11, 1977, Rose went on vacation. Several days later he asked for and was granted two more vacation days although he was told that the company "needed him." When Rose called on April 18, 1977, to request several more vacation days he was told he was terminated for lack of work. Two days after Rose was terminated for lack of work, Wilbur Allison, the fourth warehouse employee, quit the warehouse after he was threatened with suspension. The stamping work performed by Allison was redistributed to the Dawson Springs facility after Allison quit.
7
Several discussions took place among Ose, Tom Bruser, Industrial Relations Manager, and George Gardner, Midland's labor counsel, between March 31 and April 15. On April 15, Schneider was told to proceed with the decision to terminate Rose.
8
On May 19, 1977, the Board conducted an election in a unit comprised of Midland Ross's five warehouse employees including Rose who had been terminated the month before. Midland Ross challenged Rose's ballot claiming that Rose was not an employee at the time of the election and thus was ineligible to vote. The Board disagreed and ordered Rose's ballot counted resulting in three votes for and two against the union. Midland Ross admits that it has refused and continues to refuse to bargain with the union certified as exclusive bargaining representative on January 29, 1979. The company argues that the Board's finding that Rose was improperly terminated for union activities is not supported by substantial evidence. Thus Rose was no longer an employee and ineligible to cast the vote which resulted in electing the union.
9
Midland Ross contends that there is no substantial evidence that it knew that Rose was active on behalf of the union. Although the evidence is not extensive, we hold that in view of the very small work force involved, Rose's statement "if we had a union," followed a week later by the union demand for recognition permits the inference that Midland Ross knew of Rose's union activities. This inference, when added to the timing of the discharge which occurred immediately after Schneider had stated that Rose was needed at work and had completed the mortgage information form stating the probability of his continued employment was good is substantial evidence that the discharge was due in part to his union activity, rather than the explanation offered by Midland Ross. Although we might well reach a conclusion different than that of the Board's, its inferences are reasonable and thus entitled to affirmance by the Court.
10
Accordingly, the Board's application for enforcement of its orders is granted.
1
239 N.L.R.B. 169 (1979) and 243 N.L.R.B. 179 (1979) respectively
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[Cite as Stocker v. Stocker, 2017-Ohio-8434.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
HANCOCK COUNTY
JENNIFER L. STOCKER,
PLAINTIFF-APPELLEE, CASE NO. 5-17-11
v.
HANS S. STOCKER, OPINION
DEFENDANT-APPELLANT.
Appeal from Hancock County Common Pleas Court
Domestic Relations Division
Trial Court No. 2014-DR-340
Judgment Affirmed
Date of Decision: November 6, 2017
APPEARANCES:
Jose M. Lopez for Appellant
Bret A. Spaeth for Appellee
Case No. 5-17-11
SHAW. J,
{¶1} Defendant-appellant, Hans S. Stocker, appeals the April 19, 2017
Amended Judgment Entry/Decree of Divorce issued by the Hancock County Court
of Common Pleas, Domestic Relations Division, granting him a divorce from
plaintiff-appellee, Jennifer L. Stocker. On appeal, Hans argues that the trial court
erred in accepting an appraisal of the marital residence submitted by Jennifer, in
accepting the value his expert assigned to the parties’ business, and in failing to
apply the $150,000 combined income level cap in determining his child support
obligation.
Facts and Procedural History
{¶2} The parties were married on May 31, 1997. Three children were born
during the marriage in 1998, 2001, and 2004.
{¶3} In 2010, the parties created Norville Enterprises, LLC (“Norville
Enterprises”), an entity which owns a franchised operation of Adam and Eve, an
adult novelty retail store. Even though the parties owned the business together, it is
undisputed that Jennifer operated the business on a day-to-day basis.
{¶4} On October 9, 2014, Jennifer filed a complaint for divorce alleging the
parties to be incompatible. Hans timely filed an answer and a counterclaim for
divorce on the same ground.
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Case No. 5-17-11
{¶5} The case proceeded to a final evidentiary hearing before the magistrate
on October 22 and 23, 2015. At issue between the parties was the allocation of
parenting time and child support, the division of certain personal property, the value
and allocation of the marital residence, and the value of Norville Enterprises, of
which the parties agreed that Jennifer would retain sole ownership after the divorce.
{¶6} On February 17, 2016, the magistrate issued a decision. Relative to the
issues raised on appeal, the magistrate recommended that Jennifer be designated the
residential parent of the children with Hans paying $1,276.71 per month in child
support, plus processing and with provision for cash medical support. In reaching
his recommendation regarding child support, the magistrate found that it was just
and appropriate not to deviate from the child support worksheets, despite the fact
that the parties’ combined annual income exceeded $150,000. See R.C. 3119.04(B).
{¶7} At the final divorce hearing, both Jennifer and Hans submitted
professional appraisals of the marital home. The magistrate chose to accept the
appraisal submitted by Jennifer which valued the home at $290,000. The magistrate
recommended that Jennifer retain possession of the marital home, subject to the
$180,521.70 mortgage. With respect to the value of Norville Enterprises, the
magistrate heard testimony from a CPA, with a certified specialization in business
valuation, who calculated the value of Norville Enterprises to be $337,757 using an
“income approach” to valuation. After allocating the remaining marital property,
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Case No. 5-17-11
the magistrate recommended that Jennifer pay Hans $57,589.13 to equalize the
division of property between the parties.
{¶8} Hans timely filed objections to the magistrate’s decision, raising the
issues of the magistrate’s recommendation not to apply the $150,000 combined
income cap on the child support obligation and the values assigned to the marital
home and the business.
{¶9} On March 2, 2017, the trial court overruled Hans’ objections to the
magistrate’s decision, and on April 19, 2017, the trial court issued an Amended
Judgment Entry/Decree of Divorce issuing orders consistent with the
recommendations in the magistrate’s decision.
{¶10} Hans filed this appeal, asserting the following assignments error.
ASSIGNMENT OF ERROR NO. 1
THE TRIAL COURT ERRED AND ACTED CONTRARY TO
LAW WHEN IT DETERMINED THE VALUE OF THE
MARITAL RESIDENCE TO BE $290,000.
ASSIGNMENT OF ERROR NO. 2
THE TRIAL COURT ERRED IN ALLOCATING THE ASSETS
AND DEBTS OF THE BUSINESS, NORVILLE ENTERPRISES,
LLC.
ASSIGNMENT OF ERROR NO. 3
THE TRIAL COURT ERRED BY FAILING TO CAP THE
PARTIES’ GROSS INCOME AT $150,000 IN ITS
DETERMINATION OF THE CHILD SUPPORT ORDER.
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Case No. 5-17-11
First and Second Assignments of Error
{¶11} At the outset, we elect to address Hans’ first and second assignments
of error together due to the fact that they both challenge the valuation of certain
marital assets in the trial court’s equitable division of property.
Standard of Review
{¶12} An appellate court generally reviews the overall appropriateness of the
trial court’s property division in divorce proceedings under an abuse-of-discretion
standard. Cherry v. Cherry, 66 Ohio St.2d 348 (1981). An abuse of discretion
connotes that the trial court’s decision was unreasonable, arbitrary, or
unconscionable. Blakemore v. Blakemore, 5 Ohio St.3d 217 (1983). In order to
make an equitable division of property, the trial court should first determine the
value of the marital assets. See Eisler v. Eisler, 24 Ohio App.3d 151, 152 (8th Dist.
1985).
{¶13} In performing this function, the trial court has broad discretion to
develop some measure of value. See Berish v. Berish, 69 Ohio St.2d 318 (1982).
Thus, “[t]he valuation of marital assets is typically a factual issue that is left to the
discretion of the trial court.” Roberts v. Roberts, 10th Dist. Franklin No. 08AP-27,
2008-Ohio-6121, ¶ 18, citing Berish, supra. Generally, as an appellate court, we
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Case No. 5-17-11
are not the trier of fact. Our role is to determine whether there is relevant,
competent, and credible evidence upon which the fact finder could base his or her
judgment. Tennant v. Martin-Auer, 188 Ohio App.3d 768, 2010-Ohio-3489 ¶ 16
(5th Dist.).
1. The Marital Home
{¶14} In his first assignment of error, Hans claims that the trial court erred
in adopting the magistrate’s recommendation to value the marital home at $290,000.
At the final divorce hearing before the magistrate, the parties each submitted as an
exhibit a professional appraisal of the marital home. The appraisal submitted by
Jennifer assessed a value to the home of $290,000, whereas the appraisal submitted
by Hans’ valued the marital home at $323,000. The magistrate stated the following
in his decision regarding the value of the marital home.
Both appraisals consider comparable sales and determine a value
for the property that is within the range of the comparable sales.
[Hans’ appraisal] indicates that the house has gross living area of
2,676 square feet, which calculates to $120.70 per square foot.
[Jennifer’s appraisal] indicates that the house has gross living
area of 2,516 square feet, which calculates to $115.26 per square
foot. The Hancock County Auditor’s Property Card that is
attached to [Hans’ appraisal] indicates that the house has 2,516
square feet of living area. [Hans’ appraisal] used comparable
homes one of which sold on September 26, 2014, two sold on
January 14, 2015, and two were still pending sale on May 12, 2015.
[Jennifer’s appraisal] used comparable homes which sold on
August 25, 2014, May 30, 2014, and August 8, 2014. The
comparable homes used by [Jennifer’s appraisal] have sale dates
closer in time to the ending date of the marriage, October 9, 2014.
After consideration of the evidence related to the real estate,
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Case No. 5-17-11
[Jennifer’s appraisal] of $290,000 is the most accurate available
value for the real estate.
(Doc. No. 127 at 20-21).
{¶15} In overruling Hans’ objection to the magistrate’s decision, the trial
court found that the magistrate’s recommendation to accept Jennifer’s appraisal,
which assigned a value of $290,000 to the marital home, was supported by sufficient
credible evidence. On appeal, Hans highlights the fact that at the final divorce
hearing he stated that he would be willing to purchase the home at $323,000, the
value contained in his appraisal, which he claims would “maximize” the value of
the marital home. He therefore contends that the value stated in his appraisal was
supported by the greater weight of the evidence.
{¶16} However, as previously noted, the trial court was in the best position
to assess the credibility of the evidence and attribute the weight to be given
accordingly. Clearly, the trial court did not find Hans’ statements about purchasing
the home at his higher appraisal value to be more persuasive than Jennifer’s
appraisal, which relied upon the same amount of gross living area square footage as
stated in the Auditor’s property card and used comparable sales closer in time to the
termination of marriage. Thus, we conclude the record reveals that the trial court’s
adoption of the magistrate’s recommended value of $290,000 for the marital home
was supported by relevant, competent, and credible evidence and, thus, did not
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Case No. 5-17-11
constitute an abuse of discretion. Accordingly, we overrule the first assignment of
error.
2. Norville Enterprises, LLC
{¶17} In his second assignment of error, Hans challenges the trial court’s
conclusion valuing Norville Enterprises at $337,757 as being against the manifest
weight of the evidence and an abuse of discretion. Hans maintains that in arriving
at its conclusion, the trial court improperly relied upon the valuation provided by
business valuation expert, Mark Hoge (“Hoge”), who used the “income approach”
to valuing the business. Specifically, Hans claims this valuation method failed to
separately include the assets of the business in the parties’ equitable distribution of
property.
{¶18} At the final divorce hearing, Hans presented the testimony of Hoge
and submitted Hoge’s report as an exhibit. According to Hoge, the cash flow that
Norville Enterprises generates is more valuable to a perspective buyer than the
assets its holds, which is the reason why the income approach valuing the cash flow,
as opposed to a market approach or an asset approach, was his chosen method of
valuation. Hoge further explained his reasoning for determining the income
approach to be the appropriate method of valuation in this case.
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Case No. 5-17-11
So I did an initial search of our data base for similar market
transactions and came up empty, which is not uncommon.1 I
looked at the assets, which essentially was comprised of the
inventory and cash, some furniture and fixtures. Less the
company’s debt and I quickly realized that, you know, the value
of the business was in the cash flow that it generates and not the
assets it owns.
(Doc. No. 141 at 287). Based upon this method of valuation, Hoge concluded that
the fair market value of Norville Enterprises was $337,757. Notably, Jennifer
presented the testimony of Sam Robinson, a CPA who critiqued Hoge’s evaluation
and valued the business at $204,881, while still utilizing the income approach
method, but adjusting certain factors that impacted the overall value of the cash
flow.
{¶19} On appeal, Hans takes issue with his own expert using the income
approach method because it did not take into account the assets owned by Norville
Enterprises; specifically, the $50,520.29 in a savings account and the $34,479.32 in
a checking account. Hans claims that he is entitled to half of these assets in the
equitable distribution of the parties’ marital property. For instance, Hans claims
that he is entitled to half of the amounts in business checking and savings accounts,
which total $42,024.97. For reasons unknown, Hans does not include the values of
other assets of the business such as the inventory, fixtures, furniture and Jennifer’s
goodwill in his argument.
1
Hoge clarified that the database he used was called “Biz Comps,” which is the most widely used database
in business valuations. He explained that it is difficult to collect data on private company transactions.
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Case No. 5-17-11
{¶20} This notwithstanding, the record demonstrates that Norville
Enterprises was the largest martial asset. Hans’ argument seems counterintuitive
considering the fact that the parties agreed Jennifer would retain the business and
that Hoge testified the income approach provided for the most value. Thus, the
record suggests that the income approach garnered a higher value than an asset
based approach to valuation, which in turn increased the amount Jennifer was
ordered to pay Hans to equalize the distribution of marital property, despite
Jennifer’s efforts to provide evidence to reduce the value of the business.
Moreover, Hans has not provided any alternative value for the business using a
different approach.
{¶21} Nevertheless, “Ohio courts have not specified that only one method of
valuation is appropriate when dividing marital property.” Herrmann v. Herrmann,
12th Dist. Butler No. CA99-01-006 (Nov. 6, 2000), citing Clymer v. Clymer, 10th
Dist. Franklin No. 99AP-924 (Sept. 21, 2000). Rather, an equitable division of
marital property depends upon the totality of the circumstances such that a flat rule
for valuation is not appropriate in a property division. Herrmann, citing Hoyt v.
Hoyt, 53 Ohio St.3d 177, 180 (1990). “When parties present substantially different
valuations of an asset, the trial court is free to believe all, part, or none of any
witnesses’ testimony. Huelskamp v. Huelskamp, 185 Ohio App.3d 611, 2009-Ohio-
6864, ¶ 27 (3d Dist.), quoting Covert v. Covert, 4th Dist. No. 03CA778, 2004-Ohio-
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Case No. 5-17-11
3534, ¶ 29. Here, the trial court had before it credible evidence establishing the
value of Norville Enterprises at $337,757. Although Hans contends that in adopting
Hoge’s valuation, the trial court failed to consider the value of specific assets, we
find no merit to Hans’ argument on appeal.
{¶22} The trial court heard testimony supporting Hoge’s position for using
the income approach method of valuation to arrive at the best value for the business,
which by design does not take into consideration the assets of the business. The
trial court was in the best position to weigh the credibility of Hoge’s testimony. We
cannot say that the trial court clearly lost its way or created a manifest miscarriage
of justice, nor did it abuse its discretion in finding Hoge’s income approach
valuation credible. Accordingly, we overrule the second assignment of error.
Third Assignment of Error
{¶23} In his third assignment of error, Hans argues that the trial court erred
in failing to apply the $150,000 combined income level cap when calculating his
child support obligation.
Standard of Review
{¶24} “A trial court has considerable discretion related to the calculation of
child support, and, absent an abuse of discretion, an appellate court will not disturb
a child support order.” Clark v. Clark, 3d Dist. Henry No. 7-15-09, 2015-Ohio-3818,
¶ 28, citing Pauly v. Pauly, 80 Ohio St.3d 386, 390 (1997). An abuse of discretion
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Case No. 5-17-11
“implies that the court’s attitude is unreasonable, arbitrary or unconscionable.”
Blakemore v. Blakemore, 5 Ohio St.3d 217, 219 (1983).
{¶25} It is undisputed that the parties’ combined yearly gross income
exceeds $150,000. Under this circumstance, the court must calculate the child
support obligation on a case-by-case basis and must consider the needs and the
standard of living of the children and of the parents. Guertin v. Guertin, 10th Dist.
Franklin No. 06AP-1101, 2007-Ohio-2008, ¶ 4, citing R.C. 3119.04(B).
{¶26} R.C. 3119.04(B) provides that “[i]f the combined gross income of both
parents is greater than one hundred fifty thousand dollars per year, the court, with
respect to a court child support order, * * * shall determine the amount of the
obligor’s child support obligation on a case-by-case basis and shall consider the
needs and the standard of living of the children who are the subject of the child
support order and of the parents.” R.C. 3119.04(B). The statute further provides
that “[t]he court * * * shall compute a basic combined child support obligation that
is no less than the obligation that would have been computed under the basic child
support schedule and applicable worksheet for a combined gross income of one
hundred fifty thousand dollars, unless the court * * * determines that it would be
unjust or inappropriate and would not be in the best interest of the child, obligor, or
obligee to order that amount.” Id. The statute mandates that should the court make
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Case No. 5-17-11
“such a determination, it shall enter in the journal the figure, determination, and
findings.” Id.
{¶27} Here, the trial court adopted the magistrate’s recommendation not to
deviate from the child support worksheets and cap the parties’ combined gross
income at $150,000 for purposes of determining child support. Specifically, the
magistrate made the following findings in his decision with respect to child support.
The Magistrate has considered the children’s needs and standard
of living, the parties’ standard of living, and the factors found in
R.C. 3119.23. In this case the parties have reasonable vehicles, a
substantial home, and few luxuries. They maintained a
comfortable and not an extravagant lifestyle. The lifestyle
permitted the children to participate in swimming and other
activities, and permitted [the oldest child] to have a used vehicle
when he began to drive. * * * The division of property is a
substantially equal division of property. The parties do not have
income producing separate property. With the cost of
maintaining two households, the children will not enjoy the same
standard of living as they would have enjoyed had they continued
to live with both parents in a single household. However, with the
funds available between the parties, a reasonable standard of
living can be maintained for the children and both parties. * * *
The [child support] award should contemplate that [Jennifer] will
pay the children’s cost of participating in their swimming and
other sporting activities. The amount of child support shown on
the worksheets would maintain a reasonable standard of living
and would be just and appropriate for the children. The
Magistrate concludes that establishing [Hans’] child support
obligation at $15,320.51 per year, being $1,276.71 per month, is
just and appropriate, will meet the needs of the children, will
maintain the children with an appropriate standard of living in
both households, and will serve the best interest of the children.
(Doc. No. 127 at 16-17).
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Case No. 5-17-11
{¶28} In overruling Hans’ objection to the magistrate’s decision, the trial
court reasoned “while the parties were living together their combined incomes were
sufficient to support a ‘comfortable and non-extravagant’ lifestyle. It is obvious
that some of that income is now going to be needed to support the extra expense of
two households. Additionally, it is supported that there is a significant expense
associated with the children’s swimming and other sports activities, in addition to
the cost of some medical issues.” (Doc. No. 201 at 5) (emphasis sic). The trial court
further noted that “the parties have not accumulated significant savings, except for
retirement savings, during their marriage, evidently using their combined incomes
to support a family of five.” (Id.).
{¶29} On appeal, Hans argues that the trial court erred in failing to apply the
$150,000 combined gross income level cap and deviate from the child support
worksheets. Specifically, he maintains that because the parties or children “did not
maintain a life of luxury prior to the divorce” the children support award should
have been capped. (Appt. Br. at 11). However, in making this argument, Hans
overlooks the trial court’s decision not to deviate from the child support worksheet
was based upon its conclusion that the worksheet support amount was just and
appropriate to maintain a reasonable standard of living for the children that they
were accustomed to when the parties’ resources were pooled together to support one
household. There was significant testimony in the record regarding all three
-14-
Case No. 5-17-11
children’s involvement with a travelling swim club. The record indicates that with
the children’s participation in this sport, the parties’ not only incurred substantial
expenses for pool fees and specialized swim attire, but also incurred incidental
expenses related to frequent travel statewide and on the rare occasion nationally.
{¶30} This rationale in addition to the other reasons outlined by the
magistrate and trial court in their findings are supported by the record. Accordingly,
we do not find that the trial court abused its discretion in adopting the magistrate’s
recommendation not to deviate from the child support worksheets. The third
assignment of error is overruled.
{¶31} Based on the foregoing, the judgment of the Hancock County Court of
Common Pleas, Domestic Relations Division, is affirmed.
Judgment Affirmed
PRESTON, P.J. and WILLAMOWSKI, J., concur.
/jlr
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Case No. 5-17-11
-16-
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NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 06a0747n.06
Filed: October 10, 2006
No. 05-2407
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
KEENAN L. RIEPEN, )
)
Plaintiff-Appellant, )
) ON APPEAL FROM THE UNITED
v. ) STATES DISTRICT COURT FOR THE
) EASTERN DISTRICT OF MICHIGAN
COMMISSIONER OF SOCIAL SECURITY, )
)
Defendant-Appellee. )
Before: GUY, GILMAN, and ROGERS, Circuit Judges.
ROGERS, Circuit Judge. Plaintiff Keenan L. Riepen appeals the district court’s decision
affirming the Commissioner of Social Security’s denial of Riepen’s application for Disability
Insurance Benefits and Supplemental Security Income under Titles II and XVI of the Social Security
Act. Various doctors and occupational experts offered different opinions about Riepen’s ability to
work and the nature of his impairments. The ALJ’s analysis adequately states why he did not credit
the evidence and testimony in favor of Riepen’s purported disability. Because the Commissioner’s
conclusion that Riepen is not disabled is supported by substantial evidence, we affirm.
Riepen has a high school equivalency degree and was employed as a golf course maintenance
worker and bowling alley attendant. Riepen filed for social security disability benefits in 1998. He
No. 05-2407
Riepen v. Comm’r of Soc. Sec.
claimed that a variety of impairments, both physical and mental, made him disabled for purposes of
social security disability. In particular, Riepen claimed to have qualified Multiple Sclerosis (“MS”),
which is a listed impairment that would entitle him to an irrebutable presumption of disability.
Riepen’s testimony included a discussion of his various ailments, that he does not work, that he had
leg fatigue from recurring childhood injuries and surgeries, and suggested that he is in bad health and
spirits. Various medical evidence tends to bolster Riepen’s testimony. Other medical evidence and
testimony tends to undermine Riepen’s claims and show that he is exaggerating.
Riepen had a hearing before an ALJ in 2003. The ALJ denied benefits, concluding that the
medical evidence did not support Riepen’s claim to have MS, and that if Riepen did have MS, his
condition was not sufficiently severe to meet the requirements of a listed impairment entitling
Riepen to an irrebutable presumption of disability. The ALJ further reasoned that Riepen could
perform sedentary work and was therefore not disabled. In 2004, the Commissioner adopted the
ALJ’s decision as the final decision in Riepen’s case. Riepen then appealed to the district court.
A magistrate judge issued a detailed opinion, to which Riepen made two objections.
Riepen’s objections were that the magistrate judge erred by finding that Riepen did not have MS and
that the magistrate judge did not follow the treating-physician rule relied upon in Wilson v.
Commissioner of Social Security, 378 F.3d 541, 544 (6th Cir. 2004). The district court adopted the
magistrate judge’s opinion and responded to Riepen’s objections. Riepen’s arguments before this
court are largely the same as those addressed to the district court.
-2-
No. 05-2407
Riepen v. Comm’r of Soc. Sec.
This Court reviews the district court’s conclusion in a social security case de novo. Crum
v. Sullivan, 921 F.2d 642, 644 (6th Cir. 1990). However, we review the underlying findings of the
Commissioner to determine whether they are supported by substantial evidence. 42 U.S.C. § 405(g);
Walters v. Comm’r of Soc. Sec., 127 F.3d 525, 528 (6th Cir. 1997).
Riepen first argues that the ALJ erred when finding that his MS was not a severe impairment
for purposes of step two of the evaluation process.1 Because the ALJ ruled in Riepen’s favor at step
two despite this finding, we need not review the ALJ’s conclusion that Riepen’s MS was not a severe
impairment at that step. Even if Riepen is correct in his contention that the ALJ should have found
his MS to be a severe impairment, this would not be a basis for reversal or remand because the ALJ
considered all of Riepen’s alleged limitations throughout the remaining steps of the evaluation
process. In Maziarz v. Secretary of Health & Human Services, 837 F.2d 240, 244 (6th Cir. 1987),
this court held that once an ALJ determines that a claimant has at least one severe impairment, the
ALJ must continue with the remaining steps in the sequential evaluation process and consider all
impairments, including those which were not found to be “severe” at step two.
In this case, the ALJ found that Riepen had a severe combination of impairments, and
therefore continued the evaluation process after step two. At each of the subsequent steps, the ALJ
1
In evaluating whether a claimant is disabled, the Commissioner is to consider, in a five-step
sequence, whether the claimant: 1) worked during the alleged period of disability; 2) has a severe
impairment; 3) has an impairment that meets or equals the requirements of an impairment listed in
the regulations; 4) can return to past relevant work; and 5) if not, whether he or she can perform
other work in the national economy. 20 C.F.R. § 416.920(a).
-3-
No. 05-2407
Riepen v. Comm’r of Soc. Sec.
properly considered Riepen’s MS-related symptoms. The ALJ expressly considered Riepen’s MS-
related allegations in his determination that Riepen did not have any impairment that meets or equals
a listed impairment. The ALJ also considered all of Riepen’s documented symptoms and limitations,
regardless of whether they were MS-related, in assessing Riepen’s residual functional capacity.
Because the ALJ considered all of Riepen’s impairments throughout the evaluation process,
including those symptoms and limitations which Riepen characterized as being caused by MS, the
ALJ’s finding that Riepen’s alleged MS was not a severe impairment does not constitute reversible
error.
The ALJ’s conclusion at step three that Riepen did not have an impairment (including MS)
equivalent to a listed impairment is supported by substantial evidence. Riepen argues that the ALJ
should have found that he had severe MS that rendered him disabled at step three,2 and that the ALJ
erred by not giving sufficient weight to Dr. Awerbuch’s opinion, as a treating physician, that Riepen
has sufficiently severe MS to satisfy a listed impairment. For MS to entitle a claimant to a
presumption of disability under the relevant listing at step three, the claimant must establish failure
of motor function with substantial muscle weakness, demonstrated on physical examination, from
neurological dysfunction in areas of the central nervous system known to be involved by the Multiple
2
The Commissioner contends that Riepen has waived appellate review of the issues regarding
the ALJ’s analysis of the remaining steps of the sequential evaluation. For the purposes of this
opinion we assume for purposes of argument, without holding, that Riepen’s objections to the
magistrate’s recommendation were sufficient to permit appellate review of all issues before this
court.
-4-
No. 05-2407
Riepen v. Comm’r of Soc. Sec.
Sclerosis process. See 20 C.F.R. § 404.1525, App’x 1, Paragraph 11.09(c) (definition of MS that
creates a presumption of disability).3 A threshold requirement of the listing is the documented
presence of MS.4
Riepen underwent numerous tests to confirm a diagnosis of MS. Although Riepen argues
that the ALJ “substituted his own opinion for that of the treating neurologist,” the ALJ’s opinion is
not inconsistent with Dr. Awerbuch’s May, 2002, report. Dr. Awerbuch actually noted that Riepen’s
symptoms can be explained by his other medical conditions. None of Riepen’s tests for MS was
conclusive, and, other than Dr. Awerbuch, no other physician of record found that MS was the likely
cause of Riepen’s symptoms. Thus, the ALJ’s conclusion that Riepen’s symptoms are due to
impairments other than MS is supported by substantial evidence.
Furthermore, the ALJ found that even if Riepen had MS, Riepen failed to satisfy the
requirements for the listing. 20 C.F.R. Pt. 404, Subpt. P, App. 1 § 11.09 offers three ways to prove
MS. Although Dr. Awerbuch’s opinion implicated only one of the three, the ALJ compared
3
20 C.F.R. Pt. 404, Subpt. P, App. 1 § 11.09 offers three ways to prove MS. Only the third
method, found in subpart C of the listing, is implicated by Dr. Awerbuch’s opinion. Although the
ALJ did consider them, the other possibilities for MS at step three are not supported by the record.
4
Use of the criteria in 11.09C is dependent upon (1) documenting a diagnosis of
multiple sclerosis, (2) obtaining a description of fatigue considered to be
characteristic of multiple sclerosis, and (3) obtaining evidence that the system has
actually become fatigued. The evaluation of the magnitude of the impairment must
consider the degree of exercise and the severity of the resulting muscle weakness.
20 C.F.R. Pt. 404, Subpt. P, App. 1, § 11.00(E).
-5-
No. 05-2407
Riepen v. Comm’r of Soc. Sec.
Riepen’s symptoms and mental limitations to the criteria under all three sections of the MS Listing
and explained his rejection of Dr. Awerbuch’s opinion that Riepen met the MS listing criteria. In
his analysis, the ALJ relied on numerous factors from the record to support his conclusion, including
evidence that Riepen had a normal ability to walk, continued to be active, and performed household
and yard chores. The ALJ articulated “good reasons” for concluding that Dr. Awerbuch’s diagnosis
did not establish a relationship between Riepen’s symptoms and MS; accordingly, the ALJ’s decision
not to give Dr. Awerbuch’s opinion controlling weight conformed to the requirements of 20 C.F.R.
§ 404.1527(d)(2).
Finally, the ALJ’s reliance on the vocational expert’s opinion was supported by substantial
evidence. Riepen argues that the ALJ erred in step five of the evaluation process because the
hypothetical he presented to the vocational expert inaccurately described Riepen’s mental
impairment. However, the ALJ accounted for Riepen’s limitations in maintaining concentration,
persistence, and pace by restricting his hypothetical to simple, unskilled tasks. Furthermore, the
ALJ’s hypothetical was supported by the opinion of two reviewing medical consultants who found
that Riepen retained the ability to perform simple tasks on a sustained basis, could relate to others,
and could adapt. Based on the vocational expert’s testimony, substantial evidence supports the
ALJ’s finding that despite Riepen’s mental limitations, Riepen could perform a significant number
of jobs in the national economy, and was therefore not disabled.
The judgment of the district court is AFFIRMED.
-6-
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556 F.2d 554
Alvarado-Santosv.Immigration and Naturalization Service
No. 76-4250
United States Court of Appeals, Second Circuit
3/9/77
1
B.I.A.
2
PETITION DENIED, ORDER ENFORCED*
*
Oral opinion delivered in open court in the belief that no jurisprudential purpose would be served by a written opinion. An oral opinion or a summary order is not citable as precedent. Local Rule Sec. 0.23
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41 P.3d 952 (2002)
131 N.M. 671
2002-NMCA-032
STATE of New Mexico, Plaintiff-Appellee,
v.
George LACEY, Defendant-Appellant.
No. 21,502.
Court of Appeals of New Mexico.
January 23, 2002.
Certiorari Denied March 7, 2002.
*953 Patricia A. Madrid, Attorney General, William McEuen, Assistant Attorney General, Santa Fe, NM, for Appellee.
Phyllis H. Subin, Chief Public Defender, Sheila Lewis, Assistant Appellate Defender, Santa Fe, NM, for Appellant.
Certiorari Denied, No. 27,358, March 7, 2002.
OPINION
PICKARD, Judge.
{1} This case is the latest in a series of cases involving the double use of prior convictions to increase punishment. In State v. Keith, 102 N.M. 462, 463-65, 697 P.2d 145, 146-48 (Ct.App.1985), we held that a prior armed robbery conviction could not be used to raise the defendant's underlying armed robbery conviction from a second degree felony to a first degree felony, and then be used to further enhance the defendant's sentence under the general habitual offender statute. *954 In State v. Haddenham, 110 N.M. 149, 151-54, 793 P.2d 279, 281-84 (Ct.App.1990), we held that a prior felony conviction could not be the basis for a conviction of felon in possession of a firearm, and then be used to further enhance the defendant's sentence under the habitual offender statute. This case requires us to decide whether a prior trafficking conviction may be used to set Defendant's underlying conspiracy to commit trafficking conviction as a second degree felony, and then be used to enhance Defendant's sentence under the habitual offender statute. Notwithstanding the differences in the pertinent statutory language, we hold that it may not be so used.
{2} Defendant was convicted of one count of a second offense of trafficking a controlled substance and one count of conspiracy to commit that offense. He argues that the trial court's use of his 1989 trafficking conviction to prove the charge of conspiracy to commit a first degree felony, as well as to enhance his conspiracy sentence through the habitual offender statute, was an impermissible double use of the prior conviction. Defendant further argues that the trial court erred in admitting evidence of other drug crimes at his trial. Finally, Defendant argues that defense counsel's failure to move to sever the counts constituted ineffective assistance of counsel. We determine that the trial court improperly used Defendant's prior trafficking conviction both to prove the crime of conspiracy to commit a first degree felony and to enhance Defendant's conspiracy sentence under the habitual offender statute. We affirm the remaining issues.
FACTS
{3} At sentencing, the court elevated Defendant's current trafficking charge from a second degree to a first degree felony based on a prior trafficking conviction in 1989. The trial court then determined that the conspiracy charge was a second degree felony because the underlying crime of trafficking was a first degree felony. The penalty for conspiracy is based on the severity of the underlying charge. See NMSA 1978, § 30-28-2(B) (1979). After finding that mitigating circumstances existed, the court reduced Defendant's trafficking sentence from eighteen to twelve years and reduced his conspiracy sentence from nine to six years.
{4} The State additionally sought to sentence Defendant as a habitual offender. At the sentencing hearing, Defendant admitted that he had three prior felony convictions. Because the prior 1989 trafficking conviction had already been used to enhance the trafficking charge from a second degree to a first degree felony under the trafficking statute, the court, in accordance with Keith, did not use it to enhance Defendant's trafficking sentence under the habitual offender statute. Instead, the court imposed a habitual sentence of four years, instead of eight, on the trafficking charge based only on Defendant's two other prior convictions. However, the court used all three prior convictions, including the 1989 trafficking conviction, to impose an eight year habitual sentence on the conspiracy charge and sentenced Defendant to a total of sixteen years for trafficking and fourteen years for conspiracy, to be served concurrently.
DISCUSSION
Habitual Offender Statute Enhancement
{5} In New Mexico, the court's sentencing authority is limited by statute. Keith, 102 N.M. at 463, 697 P.2d at 146. The legislature must give express authorization for a sentence to be imposed. Id. Imposition of multiple punishments for the same conduct violates double jeopardy unless the legislature intended for multiple punishments to be applied. See Haddenham, 110 N.M. at 151-52, 793 P.2d at 281-82; Keith, 102 N.M. at 463, 697 P.2d at 146.
{6} In determining the intent of the legislature, we rely primarily on the language of the statute. State v. Alderete, 88 N.M. 150, 151, 538 P.2d 422, 423 (Ct.App. 1975). Statutes authorizing a more severe punishment for subsequent offenses are deemed highly penal and merit a strict construction. Keith, 102 N.M. at 465, 697 P.2d at 148; see also State v. Garcia, 91 N.M. 664, 665, 579 P.2d 790, 791 (1978). Accordingly, if the legislature truly intends to doubly enhance the penalty for a crime, it must make that intention clear. Keith, 102 N.M. at 465, 697 P.2d at 148. We resolve any doubt about the construction of a criminal statute in favor of the rule of lenity. Id.
*955 {7} This Court has held that if a prior felony conviction is already taken into account in determining the punishment for a specific crime, the legislature, unless it clearly expresses otherwise, does not intend that it also be used to enhance the conviction under the habitual offender statute. State v. Peppers, 110 N.M. 393, 400, 796 P.2d 614, 621 (Ct.App.1990); Haddenham, 110 N.M. at 154, 793 P.2d at 284 (holding that the legislature had taken defendant's prior felony conviction into consideration when it set the penalty for felon in possession of a firearm, so that the prior felony could not support a habitual offender enhancement); Keith, 102 N.M. at 465, 697 P.2d at 148 (holding that the legislature had already taken into consideration prior felony convictions when it set the penalty for repeat armed robbers, and did not intend for those prior armed robberies to be used to enhance the sentence as a habitual offender); Alderete, 88 N.M. at 151-52, 538 P.2d at 423-24 (holding that the legislature did not intend the general habitual offender statute to apply to second or subsequent violations for unlawful possession of heroin, since an enhanced sentence was already provided for under the Controlled Substances Act).
{8} New Mexico's trafficking statute contains its own enhancement provision:
B. Except as authorized by the Controlled Substances Act, it is unlawful for any person to intentionally traffic. Any person who violates this subsection is:
(1) for the first offense, guilty of a second degree felony ...; and
(2) for the second and subsequent offenses, guilty of a first degree felony....
NMSA 1978, § 30-31-20 (1990). It is evident from the language of the trafficking statute that the legislature took prior trafficking convictions into account when setting the penalty for a second trafficking offense.
{9} The trafficking statute and the general habitual offender statute indicate that the two statutes have a common purpose: to deter the commission of second or subsequent offenses and to keep repeat offenders away from society for an extended period of time. Thus, the statutes are in conflict and the more general habitual offender statute does not apply. Keith, 102 N.M. at 464, 697 P.2d at 147 (recognizing that where a general statute includes the same matter as a more specific statute, the two statutes are in conflict and the specific act is construed as an exception to the general statute). The trial court properly took the foregoing law into consideration in sentencing Defendant for the substantive offense as a first degree felon and using only two prior convictions for enhancement under the general habitual offender statute.
{10} We now address the more difficult question of whether the legislature intended the habitual offender statute to enhance the penalty for conspiracy when the crime underlying the conspiracy is an offense, such as a second conviction for trafficking, that has its own internal enhancement. We conclude that it did not.
{11} New Mexico's conspiracy statute states:
B. Whoever commits conspiracy shall be punished as follows:
(1) if the highest crime conspired to be committed is a capital or first degree felony, the person committing such conspiracy is guilty of a second degree felony;
(2) if the highest crime conspired to be committed is a second degree felony, the person committing such conspiracy is guilty of a third degree felony; and
(3) if the highest crime conspired to be committed is a third degree felony or a fourth degree felony, the person committing such conspiracy is guilty of a fourth degree felony.
Section 30-28-2(B). The State contends that when setting the penalty for conspiracy, the legislature did not take any prior convictions into account, but instead, based the punishment simply on the highest degree of crime conspired. Therefore, it argues, the prior trafficking felony may be used to enhance Defendant's conspiracy conviction under the general habitual offender statute.
{12} Absent a showing of permissive legislative intent, multiple use of the same facts to prove a predicate offense and to enhance the sentence is precluded by double jeopardy. Haddenham, 110 N.M. at 151-52, 793 P.2d at 281-82. While the State's assertion may be true in some cases of conspiracy, it does not *956 hold true in this case in which the elevation of the conspiracy charge from a third degree to a second degree felony was based upon Defendant's underlying, already enhanced trafficking conviction. In order for the court to elevate the conspiracy charge to a second degree felony, it was necessary to show that Defendant conspired to commit a first degree felony. See § 30-28-2(B)(1). In order to prove that the trafficking charge was a first degree felony, the court was required to find that Defendant had a prior trafficking conviction. See § 30-31-20(B)(2). In this case, the prior trafficking offense was used to prove the offense of conspiracy to commit a first degree felony.
{13} The State argues that this case is analogous to Peppers, in which the court held that the sentence for failure to appear, which depends upon the severity of the criminal charge for which one must appear in court, could be enhanced under the habitual offender statute, using the felony conviction underlying the proceeding at which the defendant failed to appear. See Peppers, 110 N.M. at 401, 796 P.2d at 622. In that case, the defendant had failed to appear for sentencing on a conviction of vehicular homicide. Id. at 394, 796 P.2d at 615. Because vehicular homicide is a felony, the defendant's charge of failure to appear was raised from a misdemeanor to a felony. In addition, the court allowed the use of the vehicular homicide conviction to enhance the sentence for failure to appear through the habitual offender statute. Id. at 401, 796 P.2d at 622.
{14} We find significant distinction between Peppers and the case before us in the nature of the crimes at issue. The crime of felony failure to appear does not require a prior felony conviction. See NMSA 1978, § 31-3-9(A) (1999). It requires only that a defendant be charged with a felony and that he or she wilfully fail to appear before any court or judicial officer as required. Id. The Peppers court reasoned that it could not presume that the legislature had taken the defendant's prior felony conviction for vehicular homicide into account when contemplating the punishment for felony failure to appear, as the statute did not require a prior felony conviction. Peppers, 110 N.M. at 401, 796 P.2d at 622. As no prior felony conviction for vehicular homicide was used to increase the defendant's failure to appear charge from a misdemeanor to a felony, the court permitted use of the vehicular homicide conviction to enhance the defendant's sentence for failure to appear under the habitual offender statute. Id.
{15} In the case before us, however, Defendant's 1989 trafficking conviction was used both to prove the offense of conspiracy to commit a first degree felony and to enhance Defendant's conspiracy sentence under the habitual offender statute. We discern no clear legislative intent to permit the same facts used to prove conspiracy to commit a first degree felony to also be used to enhance Defendant's sentence under the habitual offender statute. In cases in which the legislature intends to permit such double use, it must clearly indicate that intent. Id.; Haddenham, 110 N.M. at 154, 793 P.2d at 284. We believe "`[t]here is sufficient doubt that the penalty for [conspiracy to traffic] should be escalated twice by what may be an unforeseen combination of ... criminal statutes, and in the absence of an explicit legislative authorization, we will construe the law strictly by refusing to give it such an expansive interpretation.'" Keith, 102 N.M. at 465, 697 P.2d at 148 (quoting State v. Cox, 344 So.2d 1024, 1026 (La.1977)). We presume that the legislature intended that the prior trafficking felony was already taken into account when enhancing the punishment for both trafficking and conspiracy to traffic.
{16} The court's double use of the prior trafficking conviction was improper. We therefore remand this case to the trial court for resentencing. Defendant suggests that the remedy could be either to lower the conspiracy to a mitigated third degree felony (two years) and then tack on the eight year habitual sentence for a total of ten years or to leave the conspiracy as a mitigated second degree felony (six years) and then tack on only four years for a habitual sentence based on two prior convictions for the same total of ten years. Although the math works out the same in this case, our cases teach that the proper result in cases of doubt concerning legislative intent involving the habitual offender statute is to lower the habitual sentence by eliminating the felony that has been *957 previously used to elevate the underlying sentence or offense. Because our holding in this regard flows so naturally from our prior cases of Keith and Haddenham, we do not reach Defendant's alternative contention that the legislature did not intend that prior convictions should bear at all on the degree of crime conspired to be committed under Section 30-28-2.
Impermissible Character Evidence
{17} In addition to the counts of trafficking and conspiracy of which Defendant was convicted, he was also charged with one count of trafficking and one count of conspiracy to traffic, arising from an alleged drug sale on June 24, 1999, and one count of embezzlement based on an alleged attempted drug sale on July 27, 1999. At the close of the testimony, the court ordered a directed verdict of not guilty on the June 24 trafficking charge. The jury then acquitted Defendant of the June 24 conspiracy charge, as well as the July 27 embezzlement charge.
{18} Defendant argues that the jury's exposure to the evidence presented on these charges, as well as evidence involving another transaction with a man named Robinson, led to the conclusion that Defendant had a propensity for dealing drugs and that he probably sold drugs to the agents on June 30, 1999. He asserts that admission of such evidence violated the policies behind Rule 11-404(B) NMRA 2002 and, accordingly, asks this Court to remand for a new trial. The State argues that it offered this evidence to prove the properly charged offenses against Defendant for trafficking and conspiracy to traffic on June 24 and embezzlement on July 27, and not merely to show propensity.
{19} Contrary to Rule 12-213(A)(4) NMRA 2002, Defendant has neglected to inform this Court of how this issue was preserved for appellate review. "The brief in chief of the appellant ... shall contain ... a statement explaining how the issue was preserved in the court below...." Id. In addition, our review of the record reveals that Defendant never objected to the admission of the above testimony, nor did he, at any time, move to sever any of the charges in the action against him. He has therefore failed to preserve any error for our review. See Rule 12-216(A) NMRA 2002 ("To preserve a question for review it must appear that a ruling or decision by the district court was fairly invoked...."); State v. Barr, 1999-NMCA-081, ¶ 31, 127 N.M. 504, 984 P.2d 185 (stating that failure to object to inadmissible hearsay results in failure to preserve the issue for appellate review); State v. Lucero, 104 N.M. 587, 590, 725 P.2d 266, 269 (Ct.App. 1986) (recognizing that to preserve an issue for appeal, appellant must make a timely objection that specifically apprises the district court of the nature of the claimed error and evokes a ruling thereon).
{20} We nevertheless address whether Defendant was unduly prejudiced by this testimony as to merit a new trial. This Court has recognized that prejudice can result when the court erroneously admits evidence of similar charges, which may be interpreted as propensity evidence. State v. Jones, 120 N.M. 185, 190, 899 P.2d 1139, 1144 (Ct.App. 1995) (holding that when the trial court abuses its discretion in refusing to grant a motion for severance and thereby erroneously admits other-crimes evidence violating Rule 11-404(B), prejudice is established when there are convictions). However, when the trial court has committed no error in admitting evidence of similar charges, this Court has held that what defendants deem to be prosecutorial overcharging does not necessarily result in prejudice. State v. Shaulis-Powell, 1999-NMCA-090, ¶¶ 20-21, 127 N.M. 667, 986 P.2d 463 (holding that although defendant was charged with trafficking, possession with intent to distribute, and possession of marijuana over eight ounces and was convicted only of possession, her conviction was not a result of prejudicial overcharging, as there was sufficient evidence to support the conviction); State v. Armijo, 1997-NMCA-080, ¶ 10, 123 N.M. 690, 944 P.2d 919 (holding that the defendant failed to demonstrate prejudice resulting from the court's refusal to sever multiple counts of fraud, in that the jury was properly instructed and showed it could properly apply the facts to the law by acquitting on some counts and convicting on others); State v. Orgain, 115 N.M. 123, 125-26, 847 P.2d 1377, 1379-80 (Ct.App.1993) (holding that the jury's acquittal of two of the sixteen counts of forgery and conspiracy to commit forgery showed that it was able to *958 carefully apply the facts to the law and thus the defendant could not show prejudice and was not entitled to a new trial).
{21} We find that the evidence pertaining to the charges of which Defendant was acquitted did not unduly prejudice the jury. Because Defendant did not move to sever any of the charges in the proceeding, the trial court committed no error in admitting evidence pertaining to these charges. The fact that the jury acquitted Defendant of three of the five counts against him shows that it was able to carefully apply the facts to the law. See Armijo, 1997-NMCA-080, ¶ 10, 123 N.M. 690, 944 P.2d 919; Orgain, 115 N.M. at 125-26, 847 P.2d at 1379-80. We do not find sufficient prejudice to grant a new trial. Moreover, we will not revisit the rationales of these cases, as Defendant's argument would require us to do.
{22} We also take this opportunity to explicitly reject Defendant's contention, and the argument he constructs to support it, that is based on his speculation about what the jury must have done. He argues that the jury must have believed the agents' testimony in order to convict Defendant at all and therefore its acquittal on certain of the charges was a compromise. Defendant asserts that we must carefully insure that cases are not overcharged in order to discourage such compromises. We have, time and again, held that it is an impermissible technique of appellate argument to parse the testimony and speculate about what the jury must or must not have found in order to show reversible error on a different issue. See State v. Ruiz, 119 N.M. 515, 521-22, 892 P.2d 962, 968-69 (Ct.App.1995); State v. Glen Slaughter & Assocs., 119 N.M. 219, 225-26, 889 P.2d 254, 260-61 (Ct.App.1994); State v. Leyba, 80 N.M. 190, 195, 453 P.2d 211, 216 (Ct.App. 1969). In fact, the verdicts here do not appear to be a compromise, and instead reflect careful analysis of the strengths and weaknesses of the testimony on the various counts. But even if the verdicts were a compromise, it is well established under the foregoing cases that we would not engage in the type of review Defendant seeks.
{23} Finally, Defendant argues that he was prejudiced by testimony that one agent entered into another drug deal with John Robinson, an acquaintance of Defendant's, that Defendant claims did not involve him at all. In fact, Defendant was present at the beginning of this transaction. On the court's own motion, when the prosecutor acknowledged that the testimony he sought was not relevant to the actual charges, this line of testimony was abandoned.
{24} Again, defense counsel did not, at any time, object to the testimony concerning the drug sale between Robinson and the agent. Defense counsel did not ask the court for a curative instruction, directing the jury to disregard the evidence, nor did she ask for a mistrial. Regardless of Defendant's failure to preserve this issue, we find that the admission of evidence of the transaction between the agent and Robinson does not entitle Defendant to a new trial. The record indicates that the jury heard other evidence, consistent with the conspiracy and trafficking charges, indicating that Defendant and Robinson were part of a cooperative drug distribution network in Roswell, New Mexico. Any implication from the testimony that Robinson sold drugs to the agent, in a transaction that did not directly involve Defendant, was cumulative and did not constitute prejudice. See State v. Hamilton, 2000-NMCA-063, ¶ 18, 129 N.M. 321, 6 P.3d 1043 (holding that erroneous admission of uncharged conduct was harmless and not prejudicial where the evidence was cumulative); State v. Woodward, 1996-NMSC-012, ¶ 47, 121 N.M. 1, 908 P.2d 231 ("The erroneous admission of cumulative evidence is harmless error because it does not prejudice the defendant."). We deny Defendant's request for a new trial.
Ineffective Assistance of Counsel
{25} Defendant contends that his counsel's failure to file a motion for severance of counts in this case constituted ineffective assistance of counsel and denied him a fair trial. Counsel is considered effective when he or she exercises the skill, judgment, and diligence of a reasonably competent attorney. State v. Crislip, 109 N.M. 351, 353, 785 P.2d 262, 264 (Ct.App.1989). To prevail on an ineffective assistance claim, Defendant must show that his counsel fell below the standard of a reasonably competent attorney. Id. If there is a plausible, rational strategy or *959 tactic, which can explain counsel's conduct, then an ineffective assistance claim fails. State v. Harrison, 2000 NMSC 022, ¶ 63, 129 N.M. 328, 7 P.3d 478. In addition, Defendant must show that failure to meet the standard resulted in prejudice. Crislip, 109 N.M. at 353, 785 P.2d at 264. In order to establish prejudice, "`[t]he defendant must show that there is a reasonable probability that, but for counsel's unprofessional errors, the result of the proceeding would have been different.'" State v. Brazeal, 109 N.M. 752, 757-58, 790 P.2d 1033, 1038-39 (Ct.App.1990) (quoting Strickland v. Washington, 466 U.S. 668, 694, 104 S.Ct. 2052, 80 L.Ed.2d 674 (1984)).
{26} First, there was a potential rational trial strategy for not moving to sever the counts in this case. Defense counsel obtained acquittals on three of the five counts charged. The record reveals defense counsel's attempt to undermine the credibility of all the charges by trying the weaker counts along with the stronger counts. See State v. Mares, 112 N.M. 193, 198, 812 P.2d 1341, 1346 (Ct.App.1991) (holding that counsel's failure to move for severance was a reasonable trial tactic, in that the record reflected that defense counsel attempted to transfer the lack of the first victim's confidence to the state's entire case). Using the evidence presented on the June 24 trafficking and conspiracy counts, as well as the July 27 embezzlement count, defense counsel argued at closing that other people were the actual drug dealers, while Defendant merely introduced people to each other. Defendant has failed to show how this strategy was not reasonable.
{27} Second, we find no prejudice resulted from the counts being tried in the same proceeding. Defendant failed to demonstrate that had his counsel moved for severance, the motion would have been granted. See State v. Gonzales, 113 N.M. 221, 230, 824 P.2d 1023, 1032 (1992) (holding that to prevail on an ineffective assistance of counsel claim, defendant must first demonstrate that had his counsel moved for severance, the motion would have been granted). Rule 5-203(A) NMRA 2002 provides that if the charges "are of the same or similar character" or "are based on the same conduct or on a series of acts either connected together or constituting parts of a single scheme or plan," then they may be tried together. However, if a defendant will be prejudiced by a joint trial, the court may grant a severance. Rule 5-203(C). Whether or not a trial should be severed lies within the sound discretion of the trial court. State v. Hernandez, 104 N.M. 268, 272, 720 P.2d 303, 307 (Ct.App.1986). Here, the offenses all involved the same witnesses and were based upon acts alleged to constitute parts of a single scheme. Therefore, the counts were properly tried together. See id. at 272-73, 720 P.2d at 307-08 (holding that two drug deals to the same undercover officer a few days apart were clearly acts of a similar nature and were properly tried together).
{28} Defendant contends that prejudice is shown because in this case, like that of Jones, and unlike that of Hernandez, the element of knowledge was not at issue, and therefore the evidence of other counts served to unduly prejudice him. See Jones, 120 N.M. at 189, 899 P.2d at 1143 (distinguishing Hernandez). We disagree with Defendant about what was at issue. In this case, like that of Hernandez, the State had to prove that Defendant knew or believed that what he was trafficking was drugs. Defendant's claim for ineffective assistance of counsel is denied.
CONCLUSION
{29} We affirm Defendant's convictions for trafficking and conspiracy to commit trafficking. However, we remand this case to the trial court for resentencing, limiting the habitual offender sentence on the conspiracy conviction to four years.
{30} IT IS SO ORDERED.
WE CONCUR: JAMES J. WECHSLER, Judge, and JONATHAN B. SUTIN, Judge.
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330 P.2d 1113 (1958)
George E. MODDELMOG and Elsie MODDELMOG, Plaintiffs in Error,
v.
Charles COOK, Defendant in Error.
No. 18200.
Supreme Court of Colorado, En Banc.
October 20, 1958.
Rehearing Denied November 17, 1958.
Chester A. Bennett, Fort Collins, for plaintiffs in error.
Alden T. Hill, Ralph H. Coyte, Fort Collins, for defendant in error.
KNAUSS, Justice.
The parties will be referred to as they appeared in the trial court, where plaintiffs in error were plaintiffs and defendant in error was defendant.
Defendant listed his property known as "532 S. Taft Hill, together with all draperies" with the Fletcher Agency, a *1114 real estate broker in Fort Collins, Colorado. Dorothy Stone, a representative of the Fletcher Agency, contacted plaintiffs and advised them that this property was for sale and solicited plaintiffs to purchase it. Following an inspection of the property plaintiffs made an offer on the property, and on July 17, 1956 an "Agreement to Purchase Real Estate" was executed by Fletcher Agency and approved by plaintiffs and Charles Cook, the defendant. In this contract the property was described as above; the purchase price was $15,000, of which amount plaintiffs paid $500, with the balance in cash "above the loan on day of possession or closing. The buyer to assume the balance of the loan in favor of Fort Collins Federal Savings & Loan." Defendant agreed to furnish an abstract of title. It also provided "Title shall be merchantable upon payment or tender as above provided and compliance with the other terms and conditions hereunder by purchaser, the seller (Cook) shall execute and deliver a good and sufficient Warranty Deed to said purchaser, conveying said property free and clear of all taxes, liens and encumbrances, except Northern Colorado Water Conservancy District. Possession to be given on or before Sept. 1, 1956." The agreement further provided that time was of the essence thereof and if the purchaser failed to perform the contract then it "shall be void and of no effect, and both parties hereto released from all obligations hereunder, and all payments made hereon be retained * * * as liquidated damages."
It was agreed that the title to said property stood in the joint names of Charles S. Cook and Alma Cook, his wife, and that no abstract of title was ever tendered by defendant.
On August 11, 1956 plaintiffs notified defendant in writing that the premises described in the contract were subject to an "encumbrance, right-of-way and easement for an irrigation ditch over and across said premises," and demanded the return of the $500, paid on account of the purchase price. It was not denied that this easement existed.
Shortly after this demand by plaintiffs, defendant tendered to plaintiffs a deed signed by himself and his wife describing the property by metes and bounds, which deed was dated "the ____ day of ____ in the year of our Lord one thousand nine hundred and August". The deed purports to have been acknowledged by defendant and his wife on the "____ day of August, 1956". This tendered deed did not except the easement for the ditch.
Following demand by plaintiffs for a return of their down payment and refusal by defendant, the instant action was instituted. Among the allegations of the complaint was one which averred that Paul Hamilton and Lillian Hamilton, owners of property adjoining the Cook property have used said right-of-way and water thru said ditch from the Highline ditch continuously since 1935, "a date prior to the conveyance aforesaid to defendants' predecessors" in title.
By way of answer defendant admitted that Paul and Lillian Hamilton have "used said right-of-way and water through said ditch and water from the High Line Ditch for some time, the exact period being unknown to defendant;" and further answering the defendant alleged that plaintiffs "* * * carefully examined the property * * * examined the ditch and were advised by defendant that the ditch might well remain in place forever." Later an additional and further defense was filed by defendant which in substance alleged that "* * * conveyance was to be made subject to right-of-way for ditch now located across this property, and the parties both intended that said contract should be made subject to said ditch right-of-way. That said contract should be reformed so that said conveyance would be made subject to ditch right-of-way. That deed has been tendered to plaintiffs in conformity with the actual contract as made between the parties and plaintiffs have failed and refused to accept said *1115 deed or pay the balance owing under said contract * * *."
Defendant prayed for a reformation of the contract to include the matters alleged in the further defense and for a dismissal of plaintiffs' complaint.
Trial was to the court which made findings as follows: "* * * that any failure of vendee to investigate the significance of said ditch was negligence on the part of said plaintiffs. Therefore the law will not allow the rescinding of a contract wherein there is a failure to investigate the legal significance of such facts."
The trial court further found that prior to the execution of the contract plaintiffs made a personal inspection of the property and observed a lateral ditch crossing said property; that no one "represented to plaintiffs that said ditch would be removed within one year or within any time." The court found further that "through error and mistake in filling out the printed contract, there was omitted following the description of said property, the following phrase: `Conveyance to be subject to easement for lateral ditch across said property'".
As a conclusion of law the court determined that the contract should be so reformed, and "that the plaintiffs had no right in law or equity to rescind and cancel said contract," and adjudged and decreed that "the defendant have and retain the sum of $500.00 paid by plaintiffs under said contract as liquidated damages in accordance with the provisions therein." Plaintiffs bring the case here on writ of error.
This case is governed by Eriksen v. Whitescarver, 57 Colo. 409, 142 P. 413, 414. It was there stated:
"The right of way for an irrigation ditch is an easement, and constitutes an incumbrance upon land subject to such easement. Plaintiff covenanted to convey her lots free and clear of such an incumbrance. The mere fact that defendant may have known of the existence of the ditch at the time she signed the contract did not relieve the plaintiff from complying with her covenant respecting the character of the title she agreed to convey. To produce such result there must, in addition to notice, have been at least something in the transaction to show that the parties intended the incumbrance should be excluded from the operation of this covenant. * * * to hold that defendant was thereby only protected against unknown defects would rob the covenant of its value, besides destroying the force of its language."
"A recorded plat dedicating portions of a tract of land to public use for streets and alleys constitutes a defect in title to the property for which vendees have a right to refuse performance of a contract of purchase and demand rescission of the contract." White v. Evans, 120 Colo. 200, 208 P. 2d 922.
Reformation of a contract is permissible only where a mutual mistake is proved, and by the reformation the true intent of the parties will be expressed in the written instrument. Here there is no evidence of a mutual mistake. The contract of purchase and sale speaks for itself and when plaintiffs discovered the existence of the easement, they were justified in rescinding the contract and were entitled to a return of their down payment.
The mere fact that plaintiffs when inspecting the property stated that they could fence the ditch off so as to prevent their children from falling into it, was no indication that they intended to vary the terms of the written contract, or to accept a title subject to incumbrances other than those enumerated therein. The trial court erred in holding that defendants were entitled to a reformation of the contract, which is complete and unambiguous.
The judgment of the trial court is reversed and the cause remanded with direction to enter judgment in favor of plaintiffs for $500 and interest from the date of their demand.
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836 F.Supp. 104 (1993)
UNITED STATES, Plaintiff,
v.
ALL ASSETS OF BLUE CHIP COFFEE, INC., et al., Defendants.
Nos. 91 CV 2713 (SJ), 91 CV 3758 (SJ).
United States District Court, E.D. New York.
October 27, 1993.
*105 Zachary W. Carter, U.S. Atty., E.D.N.Y. by Richard Hayes, Asst. U.S. Atty., Brooklyn, NY, for plaintiff.
John M. Leventhal, Rosenthal, Vallario, Leventhal & Coffinas, Brooklyn, NY, for claimants Anthony Viola and Anna Viola.
MEMORANDUM AND ORDER
JOHNSON, District Judge:
Plaintiff United States of America ("Government") has moved pursuant to Rule 56 of the Federal Rules of Civil Procedure for partial summary judgment, granting forfeiture of claimant Anthony Viola's ("Viola") interest in the defendants in rem. Claimants Anthony Viola and Anna Viola ("Claimants") have cross-moved for partial summary judgment, and additionally moved for an Order granting leave to claimant Anna Viola ("Anna Viola") to file a Notice of Claim out of time and to file an Answer.[1]
BACKGROUND
On December 4, 1992, after a jury trial in this Court, Viola was convicted of numerous crimes including conspiring and attempting to possess cocaine, trafficking in huge amounts of stolen goods and violating the Racketeer Influenced and Corrupt Organizations Act (RICO). United States v. Anthony Viola, et al., 91 CR 800 (S-5) (SJ) ("United States v. Viola"). The RICO enterprise in which Viola was convicted of participating was headquartered at the offices of Blue Chip Coffee, Inc. ("Blue Chip"), a company which Viola owns and operates. Blue Chip is headquartered at the defendant premises 615 Sackett Street, Brooklyn, New York ("615 Sackett"), 601 Sackett Street, Brooklyn, New York ("601 Sackett") and 41 Summit Street, Brooklyn, New York ("41 Summit"). Blue Chip also occupies a warehouse at 45 Summit Street, Brooklyn, New York ("45 Summit") which is also a defendant in this action.
The Government contends that, as a result of their role in Viola's criminal enterprises, all of these properties including defendant *106 Blue Chip are subject to forfeiture pursuant to 21 U.S.C. § 881 and 18 U.S.C. § 981.
DISCUSSION
Motions for Summary Judgment
The government has moved for partial summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure; the claimants have cross-moved for summary judgment.
Summary judgment is proper if the evidence developed during discovery shows that there is no genuine issue as to any material fact and that the moving party is thus entitled to a judgment as a matter of law. Fed.R.Civ.P. 56(c). The court's function is not to resolve disputed issues of fact, but only to determine whether there is a genuine issue to be tried. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986); Eastman Machine Co. v. United States, 841 F.2d 469, 473 (2d Cir.1988).
In making this determination, the court is required to view the evidence in the light most favorable to the nonmoving party. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986); Adickes v. S.H. Kress and Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970). Where, as here, both parties move for partial summary judgment, the court generally is required to assess each motion on its own merits and to view the evidence in the light most favorable to the party opposing the motion, drawing all reasonable inferences in favor of that party. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962); Eastman Machine, 841 F.2d at 473.
In a forfeiture proceeding, however, the burden of proving whether a genuine issue of material fact exists is somewhat modified, as is the burden shifting between the movant and the claimant. United States v. 303 West 116th Street, 901 F.2d 288, 290-91 (2d Cir.1990) In an action for civil forfeiture, the government must demonstrate that there was probable cause for the forfeiture, that is that there were reasonable grounds to believe that the property was subject to forfeiture. Id. at 291. Once the government has met this initial burden, the burden shifts to claimant to establish either that the property was not used for an unlawful purpose or that such use was without the claimant's knowledge and consent. Id.
Two different statutes at issue here provide for the forfeiture of property that has been involved in criminal enterprises. The drug forfeiture statute, 21 U.S.C. § 881, subjects to forfeiture any property "which is used, or intended to be used, in any manner or part, to commit, or to facilitate" the commission of narcotics transactions. 21 U.S.C. § 881(a)(7). The second civil forfeiture statute renders forfeitable any property "involved" in trafficking in or "laundering" unlawfully obtained goods, in violation of 18 U.S.C. § 1956. 18 U.S.C. § 981(a)(1)(A).
The government argues that the defendant properties are subject to forfeiture as a matter of law. The government alleges that the defendant 615 Sackett was continuously used by Viola to plot the narcotics dealings for which he was convicted. The government further alleges that the unlawfully obtained goods, in which Viola was convicted of trafficking, were stored on the premises of defendants 601 Sackett, 41 Summit, and 45 Summit and that the trafficking occurred through the vehicle of defendant Blue Chip. Claimant argues that defendants 601 Sackett, 41 Summit, 45 Summit and Blue Chip are not subject to forfeiture as the statute permits the forfeiture only of properties acquired with the proceeds of illegal activity.
For the following reasons, the government's motion for partial summary judgment is granted in its entirety. The claimants' motion for partial summary judgment is denied.
Forfeiture Under Narcotics Statutes
The government asserts that defendant 615 Sackett is subject to forfeiture pursuant to 21 U.S.C. § 881.
Section 881 of the narcotics statute provides for the forfeiture of "all real property ... which is used, or intended to be used, in any manner or part, to commit, or to facilitate the commission of [a felony violation of *107 Title 21, United States Code.] 21 U.S.C. § 881(a)(7).
The government alleges, and Viola has offered no evidence, to dispute that defendant 615 Sackett Street was used in the narcotics dealings with which Viola was convicted in United States v. Viola. The government has therefore sustained its burden of proving that defendant 615 Sackett is subject to forfeiture to the government pursuant to 21 U.S.C. § 881, due to its role in facilitating the conspiracy and attempt to possess cocaine of which Viola was convicted.
The government's motion for partial summary judgment as to defendant 615 Sackett is granted. The claimants' motion for partial summary judgment as to defendant 615 Sackett is denied.
Forfeiture Pursuant to 18 U.S.C. § 981
The government further asserts that defendants 601 Sackett, 41 Summit, 45 Summit and Blue Chip are subject to forfeiture pursuant to 18 U.S.C. § 981.
Section 981 renders forfeitable those properties which are either derived from the proceeds of or involved in the violation of certain statutes. There is no dispute either as to the ownership of defendants 601 Sackett, 41 Summit, 45 Summit and Blue Chip or as to whether the properties were used in the criminal activity of which Viola was convicted. The government has alleged that the defendant properties were used, among other things, to store, hide and distribute stolen property and the claimants do not dispute that the defendant properties were used for these purposes. The government has, therefore, met its burden of proving that there is no genuine issue of material fact in regard to the forfeiture of defendant properties.
The disputes to be resolved here are legal issues: first, what constitutes the involvement of property in a criminal transaction for the purposes of forfeiture pursuant to 18 U.S.C. § 981(a)(1)(A) and, second, whether the criminal activity for which Viola was convicted subjects the properties to forfeiture pursuant to 18 U.S.C. § 981(a)(1)(A).
Involvement of Property in Transaction
In order to be subject to forfeiture pursuant to 18 U.S.C. § 981(a)(1)(A), property need only be "involved" in a transaction or attempted transaction. The claimants incorrectly argues that to be "involved" in a criminal activity for the purposes of forfeiture under 18 U.S.C. § 981, the property must "represent proceeds of a specified criminal activity." The government does not allege that the defendant properties represent the proceeds of criminal activity. Rather, the government correctly states that 18 U.S.C. § 981(a)(1)(A) requires only that the property be "involved in a transaction or attempted transaction" in violation of specified statutes.
The Congressional intent to subject to forfeiture under 981(a)(1)(A), properties that are merely "involved" in criminal transactions is evidenced by the more exacting language of sections 981(a)(1)(B) and 981(a)(1)(C). Sections 981(a)(1)(B) and 981(a)(1)(C) permit the forfeiture of properties "constituting, deriv[ing] from, or traceable to" the proceeds of specified criminal activities. 18 U.S.C. § 981(a)(1)(B), (a)(1)(C). Had Congress meant to narrow the definition of the involvement of forfeitable property in the transactions specified in section 981(a)(1)(A), it would have to look no further than the next provisions of that statute for the language to do so. Order, United States of America v. Real Property, Nos. 90-46-Civ-T(B), 90-47-Civ-T(B), 1990 WL 305391 (M.D.Fla. February 12, 1990) (Congress intended "property involved" to include property used to facilitate the laundering process).
Defendants 601 Sackett, 41 Summit, 45 Summit and Blue Chip were sufficiently "involved" in the criminal transactions for which Viola was convicted that they are subject to forfeiture pursuant to 18 U.S.C. § 981(a)(1)(A).
Criminal Activity for the Purposes of Forfeiture
The final question is, is the activity for which Viola was convicted criminal activity of the sort specified by section 981(a)(1)(A) such that the defendants 601 Sackett, 41 Summit, 45 Summit and Blue Chip are subject to civil forfeiture.
The statute at issue here, 18 U.S.C. § 1981(a)(1)(A), renders forfeitable property *108 "involved" in violations of 18 U.S.C. § 1956. The government argues that Viola's conviction for dealing in stolen goods in interstate commerce in violation of 18 U.S.C. § 659 constitutes a violation of 18 U.S.C. § 1956 for the purposes of 18 U.S.C. § 981(a)(1)(A). Though this initially seems circular, the Court finds that this is the logical, and perhaps Congressionally anticipated, effect of these combined statutes.
The forfeiture statute at issue here, 18 U.S.C. § 981(a)(1)(A) provides for the forfeiture of any property involved in a transaction or attempted transaction "in violation of ... section 1956 of this title." 18 U.S.C. § 981(a)(1)(A).
Section 1956 of Title 18 penalizes money laundering activities. The statute may be violated by
"(a)(1) Whoever, knowing that the property involved in a financial transaction represents the proceeds of some form of unlawful activity, conducts or attempts to conduct such a financial transaction which in fact involves the proceeds of specified unlawful activity." 18 U.S.C. § 1956(a)(1).
The "specified unlawful activity" described in section (a)(1) of the money laundering statute is defined, in part, as "any act or activity constituting an offense listed in section 1961(1) of this title." 18 U.S.C. § 1956(c)(7).
Section 1961(1) of Title 18 defines racketeering activities for the purposes of RICO. 18 U.S.C. § 1961(1). Those activities defined by 1961(1) include trafficking in stolen property in interstate commerce in violation of 18 U.S.C. § 659, one of the offenses of which Viola was convicted. See Generally United States v. Taylor, 984 F.2d 298, 301 (9th Cir. 1993) (offenses defined in § 1961(1) are incorporated into § 1956(c)(7)); United States v. Real Property Known as 16899 S.W. Greenbriar, 774 F.Supp. 1267 (D.Or.1991). Therefore, Viola's conviction under 18 U.S.C. § 659 constitutes a violation of 18 U.S.C. § 1956 for the purposes of 18 U.S.C. § 981(a)(1)(A).
In addition, section 981 is not intended to provide for forfeiture of those properties which were involved in activities which resulted in a criminal conviction pursuant to 1956. Section 982 provides for the automatic forfeiture of properties which were involved in criminal convictions under section 1956 or several other statutes. ("The court, in imposing sentence on a person convicted of an offense in violation of ... section 1956 ... shall order that the person forfeit to the United States any property, real or personal, involved in such offense.") 18 U.S.C. § 982(a)(1). Therefore, Congress intended section 981 to apply to those properties involved in activities for which there was no criminal conviction pursuant to section 1956. The application of § 981 to the forfeiture of properties involved in activities defined in section 1961(1) is therefore not only logical pursuant to that statute, but was probably the intended result of this web of forfeiture and money laundering statutes.
The government's motion for partial summary judgment is granted as to defendants 601 Sackett, 41 Summit, 45 Summit and Blue Chip. Claimant's motion for partial summary judgment is denied.
Motion to file Notice of Claim and Answer
Claimant Anna Viola has further moved for leave to file a late claim to the in rem defendants in this action.
Anna Viola asserts that she should be permitted to file a late claim to the defendants. The government argues that Anna Viola has shown no reasonable excuse for her failure to file a timely claim to the defendants.
A claimant in a civil forfeiture action may file a late claim only upon a showing of "excusable neglect." Fed.R.Civ.P. 6(b)(2), United States v. Borromeo, 945 F.2d 750, 753 (4th Cir.1991).
Anna Viola has shown no excuse for her neglect to file a claim in this action. The only "excuse" which Anna Viola has offered is that she believed in her husband's innocence and therefore did not make a claim to the property prior to his conviction. This "excuse" is no excuse at all as an acquittal does not bar a forfeiture action. United States v. One Assortment of 89 Firearms, 465 U.S. 354, 104 S.Ct. 1099, 79 L.Ed.2d 361 (1984).
*109 Having failed to file a timely claim to the in rem defendants, Anna Viola will not be given leave to file a late claim.
Anna Viola also asserts that she has standing to file a claim to the in rem defendants. In order to file a claim in a civil forfeiture action a claimant must have an interest in the seized item sufficient to permit her to contest the forfeiture. Mercado v. United States Customs Service, 873 F.2d 641, 644 (2d Cir.1989); United States v. $364,960 in United States Currency, 661 F.2d 319, 326 (5th Cir.1981). Anna Viola does not claim to have a title interest in the properties, but instead claims that she would have an interest in the properties in the event of divorce or of the death of her husband. While the applicable New York State statutes may, as Anna Viola argues, encourage divorce for the purpose of the evasion of the forfeiture laws, they do not apply here. Anna Viola is claiming a future interest in the in rem defendants, contingent upon the dissolution of her marriage through death or divorce. Because Anna Viola has not filed a timely claim to the in rem defendants, however, the Court need not reach the issue of her standing to bring such a claim.
Claimants' motion for leave for claimant Anna Viola to file a late claim to the in rem defendants is denied.
CONCLUSION
Plaintiff's motion for partial summary judgment is GRANTED;
Claimants' motion for partial summary judgment is DENIED;
Claimant Anna Viola's motion to file a Notice of Claim out of time and to file an Answer is DENIED.
NOTES
[1] Viola also moved to hold these motions in abeyance pending the final disposition of the criminal proceedings against him. This motion was denied by this Court. Order, United States v. All Assets of Blue Chip Coffee, et al., 91 CV 2713, 91 CV 3758 (E.D.N.Y. March 2, 1993).
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191 F.2d 721
SAMPSELLv.PEOPLE OF STATE OF CALIFORNIA et al.
No. 12704.
United States Court of Appeals Ninth Circuit.
September 18, 1951.
J. Oscar Goldstein, San Francisco, Cal., for appellant.
Edmund G. Brown, Atty. Gen., State of Cal., Clarence A. Linn, Deputy Atty. Gen., for appellee.
Before MATHEWS, STEPHENS and HEALY, Circuit Judges.
STEPHENS, Circuit Judge.
1
Sampsell was convicted in a California Superior Court of murder in the first degree, assault with a deadly weapon with intent to murder, and robbery in the first degree, and sentenced to death. The California Supreme Court affirmed the judgment, People v. Sampsell, 1950, 34 Cal.2d 757, 214 P.2d 813, and the United States Supreme Court denied certiorari, Sampsell v. California, 1950, 339 U.S. 990, 70 S.Ct. 1016, 94 L.Ed. 1391. He is here appealing from a judgment of the United States District Court dismissing his petition for the issuance of the writ of habeas corpus. The judgment followed the issuance of an order to show cause upon which issues were drawn in accordance with the usual practice.
2
Where a petitioner has exhausted his state remedies and his petition for certiorari in the United States Supreme Court has been denied, a federal district court has jurisdiction to entertain an application for federal habeas corpus. Darr v. Burford, 1950, 339 U.S. 200, 70 S.Ct. 587, 94 L.Ed. 761; Title 28 U.S.C.A. § 2254. In such a case, appellate jurisdiction is conferred upon this court by Title 28 U.S.C.A. § 2253. The denial of certiorari by the United States Supreme Court carries no weight in the subsequent federal habeas corpus proceeding. Darr v. Burford, supra, 339 U.S. at page 216, 70 S.Ct. at page 596.
3
Sampsell claims and has the burden of showing that the state so departed from constitutional requirements as to justify a federal court's intervention. Darr v. Burford, supra, 339 U.S. at page 218, 70 S.Ct. at page 597. The Great Writ does not extend to the prisoner in this type of proceeding unless he is in custody in violation of the constitution or laws or treaties of the United States. Title 28 U.S.C.A. § 2241(c)(3).
4
The intervention of the United States District Court is justified by petitioner because, as he claims, the jury was not instructed to the effect that unanimous agreement of the jury members upon the penalty was necessary, should a verdict of guilty be returned. He relies upon Andres v. United States, 1948, 333 U.S. 740, 68 S.Ct. 880, 92 L.Ed. 1055, where a conviction in a federal district court was reversed for misdirection of the jury as to the unanimity required on the penalty issue. In the Andres case the Supreme Court was exercising its function of reviewing federal criminal proceedings, and was not dealing with the question of the deprivation of constitutional rights. Whether cognizance of this point by the district court was proper in this proceeding we do not stop to consider since the contention is without support factually. The instructions clearly covered the point. The jury were told that if a verdict of guilty of murder is found by the unanimous vote of the jurors the penalty of death or imprisonment for life was a matter of discretion for the jury. They were told that such discretion should be exercised in the following manner: If the jury should find that the punishment is to be life imprisonment, notation to that effect is to be added to the verdict of guilty, but that if the punishment should be death, nothing should be added to the verdict of guilty. The jury were also told that "If any individual juror, or the jury as a whole, entertains a reasonable doubt as to which one of two or more punishments should be imposed, it is your duty to impose the lesser of the two." It is not and could not well be contended that life imprisonment is not the lesser of the two. Jurors cannot be assumed to be below the level of common understanding. And it can hardly be argued that the common and plain meaning of these instructions is that the verdict of "guilty" without more meant and was under the California statute a verdict unanimously agreed to that the punishment should be that of death. Such was the decision of the Supreme Court of California. We hold that it was not error for the district court to dismiss the petition as to this point.
5
Petitioner also contends that alleged misconduct of the district attorney in his closing remarks to the jury deprived him of a fair trial, in violation of the Fourteenth Amendment. These remarks followed the defense attorney's argument to the jury in which he laid particular emphasis upon the complete responsibility of each individual juror for determining whether the death penalty should be inflicted.
6
During the course of the trial the petitioner voluntarily took the stand and admitted the robbery and the killing, and also related much as to his criminal record. Under state law, California Penal Code 1949, Section 189, any murder committed in the perpetration of robbery is murder in the first degree irrespective of intention. People v. King, 1939, 13 Cal.2d 521, 90 P.2d 291. California law further provides that every person guilty of murder in the first degree shall suffer death, or confinement in the state prison for life, at the discretion of the jury trying the same. California Penal Code 1949, Section 190.
7
Therefore, petitioner's own testimony subjected him to conviction of murder in the first degree. The only really contested issue before the jury was as to the penalty to be imposed. The district attorney addressed the jury on this issue as follows:
8
"Now it is interesting to note that in going over these steps [the procedure after death penalty is pronounced] that Counsel [in his argument to the jury] omitted one very, very important step. He said the responsibility [for imposition of the death penalty] was entirely yours. There was nothing the Court could do. Nothing we could do. It was entirely your responsibility. Nothing they could do in San Quentin, or wherever it happens to be. Well, it so happens, Ladies, that the State of California has what is known as an automatic appeal in a death case, and it is not entirely your responsibility.
9
"Your verdict first must be approved in a death case by the Supreme Court of the State of California before all of the steps that he mentions are taken, to be sure that the Supreme Court is in agreement with your verdict.
10
"So it is not all your responsibility. It is part of the Supreme Court of the State of California's responsibility. That step was omitted by counsel in his attempt to appeal to your sympathy. So that you are not assuming the entire responsibility at all.
11
"But if you are convinced, that [sic] I am sure you will be and are, that he is guilty of first degree murder in this case, and there should be no recommendation [that is, provision for life imprisonment in the written verdict], in such event the Supreme Court will pass upon that. Then it will be their responsibility, after you have passed on the facts and the evidence in this case. And in this argument against the extreme penalty, the inference is that the other alternative should be used.
12
"Now a lot of people are under the mistaken notion that life imprisonment means the rest of their natural life, in California. That is not true. The average life sentence in the State of California is a little under seven years. That is what that means. That is the punishment he is asking, for the life of Mr. Smith and others. Less than seven years. Not for natural life at all * * *."
13
The California Supreme Court considered the remarks of the district attorney and dealt with them in its unanimous opinion. With reference to the statement of the district attorney that a life term in California is "less than seven years", that court said, People v. Sampsell, 1950, 34 Cal.2d 757, 764, 214 P.2d 813, 818: "Section 3046 of the Penal Code provides that `No prisoner imprisoned under a life sentence may be paroled until he has served at least seven calendar years.' The district attorney's remark would seem to be a misstatement of the law since a `life-termer' is not entitled to credits for good behaviour * * *." The court goes on to hold that this error was not prejudicial since the trial court admonished the jury generally during the defense attorney's argument that they were to disregard any statements of counsel other than "what you have heard from the witness stand". It could well have said also that the jury was instructed to take the law solely from the court and that the instruction of the court plainly stated the law as we have stated it under the first point herein treated.
14
The California Supreme Court then states 34 Cal.2d at page 765, 214 P.2d at page 818, of the cited opinion: "The district attorney's remarks concerning the function of this Court where an automatic appeal is taken and his remarks concerning the probability of parole constitute reprehensible conduct which is not to be condoned.1 It is only because the evidence in this case so clearly establishes the defendant's guilt that we do not consider that reversible error was committed." [Italics from original opinion.] It also stated that no objection to the remarks was made before the verdict was returned. It would appear that defense counsel, at no time, was under the apprehension that the district attorney's random remarks would or did mislead the jury.
15
Our function in this type of proceeding is not to correct errors committed in a state trial court. Frank v. Mangum, 1915, 237 U.S. 309, 35 S.Ct. 582, 59 L.Ed. 969. "`[T]he state has full control over the procedure in its courts, both in civil and criminal cases; subject only to the qualifications that such procedure must not work a denial of fundamental rights, or conflict with specific and applicable provisions of the Federal Constitution.'" Murphy v. Massachusetts, 1900, 177 U.S. 155, 163, 20 S.Ct. 639, 642, 44 L.Ed. 711. We must here determine whether the writ of habeas corpus should have issued upon the ground that petitioner is in custody in violation of the constitution or laws or treaties of the United States. Title 28 U.S.C.A. § 2241(c)(3).
16
Federal courts must withhold interference with the administration of state criminal justice unless a federal right has been violated. See cases reviewed in Hawk v. Olson, 1945, 326 U.S. 271, 66 S.Ct. 116, 90 L.Ed. 61. When collaterally attacked a judgment of a court carries with it the presumption of regularity and may not lightly be set aside, even on habeas corpus. Johnson v. Zerbst, 1938, 304 U.S. 458, 58 S.Ct. 1019, 82 L.Ed. 1461. The control by this court over criminal trials in state courts is more limited than our review of a criminal proceeding in the federal district courts. Malinski v. New York, 1945, 324 U.S. 401, 411, 65 S.Ct. 781, 89 L.Ed. 1029.
17
The issue in this type of proceeding is not whether the statements of the district attorney deprived petitioner of trial by jury, see Palko v. Connecticut, 1937, 302 U.S. 319, 325, 58 S.Ct. 149, 82 L.Ed. 288, but whether his conviction was the result of an unfair trial, Adamson v. California, 1947, 332 U.S. 46, 67 S.Ct. 1672, 91 L.Ed. 1903, and therefore deprived him of life, liberty, or property without due process of law. United States Constitution, Amendment XIV, Section 1.
18
Petitioner was given a jury trial and we can see nothing in the ill considered remarks of the district attorney that could move a federal court to hold, over the judgment of the state Supreme Court, that the trial was unfair to the point of violating the Fourteenth Amendment to the Constitution of the United States or in violation of any other section of that charter. In Buchalter v. New York, 1943, 319 U.S. 427, 431, 63 S.Ct. 1129, 1132, 87 L.Ed. 1492, the court stated: "The speeches of counsel for defendants apparently provoked statements by the District Attorney of which petitioners now complain. This does not raise a due process question." See Adamson v. California, supra; Crumpton v. United States, 1891, 138 U.S. 361, 364, 11 S.Ct. 355, 34 L.Ed. 958; Berger v. United States, 1935, 295 U.S. 78, 55 S.Ct. 629, 79 L.Ed. 1314, to the effect of a strong case as to guilt.
19
The contention that the variation of treatment given to accused persons in applying California Penal Code Section 190,2 due to conflicting decisions of the state Supreme Court, deprives petitioner of equal protection of the laws, is without merit. That provision does not assure a defendant that juries in state murder trials shall all be given exactly the same instructions or that state decisions shall be uniform on varying fact situations. It is normally the function of a state's highest tribunal to assure its constituents reasonable uniformity of practice in lower state courts. Failure to do so however does not deprive litigants of the equal protection of the laws. Lisenba v. California, 1941, 314 U.S. 219, 226, 62 S.Ct. 280, 86 L.Ed. 166. Uniformity of judicial decisions is not assured by the equal protection guaranty. Milwaukee Elec. Ry. Co. v. Milwaukee, 1920, 252 U.S. 100, 106, 40 S.Ct. 306, 64 L.Ed. 476. We have already said that the jury in the instant case was properly and plainly instructed as to the applicable law.
20
Petitioner claims that consideration of Article VI, Section 4½ of the California Constitution by the California Supreme Court is violative of the United States Constitution. The provision is as follows: "Sec. 4½. [Harmless Errors to be Disregarded.] No judgment shall be set aside, or new trial granted, in any case, on the ground of misdirection of the jury, or of the improper admission or rejection of evidence, or for any error as to any matter of pleading, or for any error as to any matter of procedure, unless, after an examination of the entire cause, including the evidence, the court shall be of the opinion that the error complained of has resulted in a miscarriage of justice."
21
The principles set forth in Murphy v. Massachusetts, 1900, 177 U.S. 155, 158, 20 S.Ct. 639, 44 L.Ed. 711, dispose of this point.
The judgment of the district court is
22
Affirmed.
Notes:
1
California Penal Code 1949, "§ 1239. * * * (b) When upon any plea a judgment of death is rendered, an appeal is automatically taken by the defendant without any action by him or his counsel."
2
California Penal Code 1949, "§ 190. Every person guilty of murder in the first degree shall suffer death, or confinement in the state prison for life, at the discretion of the jury trying the same; or, upon the plea of guilty, the court shall determine the same; and every person guilty of murder in the second degree is punishable by imprisonment in the state prison from five years to life; provided, however, this section is to apply to all persons now serving sentence in a state prison for murder of the second degree and the sentence of such persons may be modified or reduced to conform to this section; provided, however, that the death penalty shall not be imposed or inflicted upon any person for murder committed before such person shall have reached the age of eighteen years; provided, further, that the burden of proof as to the age of said person shall be upon the defendant."
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134 A.2d 612 (1957)
TOWN OF GLOVER
v.
David V. ANDERSON, Auditor of Accounts.
No. 1853.
Supreme Court of Vermont. Washington.
September 3, 1957.
*613 Lee E. Emerson, Barton, for plaintiff.
Frederick M. Reed, Atty. Gen., and Stephen B. Richardson, Deputy Atty. Gen., for defendant.
Before CLEARY, ADAMS, HULBURD and HOLDEN, JJ., and SYLVESTER, Superior Judge.
ADAMS, Justice.
This is a petition for a writ of mandamus to compel the petitionee as Auditor of Accounts to issue his warrant to reimburse the petitioner, the Town of Glover, for $565 expended for the care and support of Walter Place, an alleged non-settled poor person.
The parties have filed a stipulation of agreed facts in substance, as follows: Walter Place was born in Holland, Vermont, April 30, 1908. He is a person of sub-normal mentality, of the mental age of approximately eight years, a moron and incapable of establishing a settlement in his own right. He resided with his mother in the town of Glover from 1916 to the date of her death on May 1, 1953 and her residence and pauper settlement was in that town. After the death of his mother, Place was placed under guardianship and from that date until August 5, 1956, there were sufficient funds in the guardianship estate to provide for his care and support. Since that date the town of Glover has been required to provide for his care and support. On October 26, 1956, by a notice that was in proper form and timely, said town notified the Auditor of Accounts and the Commissioner of Institutions that it would seek reimbursement from the state of Vermont for aid furnished Place. November 15, 1956, on a form provided by the state, a claim for reimbursement for $260 was made. On March 21, 1957, the date of the petition herein, the town had expended $565 in providing for the care and support of Place. The petitionee, as Auditor of Accounts, disallowed the claim upon the ground that Place was not a non-settled person for whose care the state is ultimately responsible because he has a pauper settlement in the town of Glover.
The petitionee filed a motion to quash and an answer. We are not required to consider the answer because of the agreed statement of facts. The motion to quash is based upon two grounds: (1) That the obligation of the state to reimburse the petitioner is not clearly established by law, depending upon the interpretation of the statutes as to whether or not Place may or may not have a settlement in the town of Glover, so the consequent duty of the petitionee is not clear and the writ will issue only when the petitioner has a clear legal right to the performance of the particular duty and when it appears that the law affords no other remedy. (2) That the petitioner has a full, adequate and complete remedy by way of declaratory relief and such relief is a bar to mandamus action.
*614 It is fundamental that in order to justify the issuance of a writ of mandamus, it must appear that the petitioner has a clear legal right to the performance of the particular duty at the hands of the petitionee and that the law affords no other adequate remedy. Matter of Savage, 112 Vt. 89, 92, 22 A.2d 153, and cases cited.
Mandamus lies in a proper case to enforce the performance of a ministerial act by a public official. Gaffney v. Commissioners of Jail Delivery, 111 Vt. 196, 200, 13 A.2d 192. If the duty is one that necessarily involves an inquiry of fact and an exercise of judgment on the case presented, it is not considered ministerial but discretionary and the disposition of it made by the official will be binding upon the courts. Proctor v. Hufnail, 111 Vt. 365, 369, 16 A.2d 518. A decision that rests solely upon the construction of a statute does not involve that exercise of judgment which the law contemplates. State v. Howard, 83 Vt. 6, 14, 74 A. 392. See Peck v. Powell, 62 Vt. 296, 19 A. 227; Fay v. Barber, 72 Vt. 55, 47 A. 180; Carpenter's Adm'r v. Brown, 118 Vt. 148, 102 A.2d 331.
This points up the question involved here. Did or did not Walter Place, under the pertinent statutes, have a pauper settlement in the town of Glover in 1956?
Under our former pauper law unemancipated minors living with and supported by their parents did not acquire a pauper residence in their own right. They were deemed incapable of exercising any choice or volition of their own. Marshfield v. Tunbridge, 62 Vt. 455, 457, 20 A. 106. For the same reason it was held that a person who is mentally defective is incapable of any choice or intention as to residence and while living with his parents did not acquire a residence in his own right. Upon the death of the father, who was the head of the family, the mentally incompetent son who was living in the family had no pauper settlement, there being no such thing as a derivative residence. Fairfax v. Westford, 67 Vt. 390, 392, 393, 31 A. 847. The matter of impaired intellect was also recognized in Westmore v. Sheffield, 56 Vt. 239, 244; Town of Topsham v. Chelsea, 60 Vt. 219, 222-223, 13 A. 861; Rowell v. Vershire, 62 Vt. 405, 409, 19 A. 990, 8 L.R. A. 708; Town of Danville v. Hartford, 73 Vt. 300, 50 A. 1082.
There being no such thing as a derivative settlement, a married woman, who was not considered sui juris, could not acquire a settlement in her own right. Upon the decease of her husband she did not, therefore, take the settlement that he had while they were living together. Town of Jericho v. Morristown, 77 Vt. 367, 369-370, 60 A. 233, decided in 1906. The legislature at its next session by No. 102 of the Acts of 1906 provided that a married woman lives with her husband in a town where he last resided for three years supporting himself and family shall be deemed to have gained a pauper residence in such town. This statute with some modifications and additions is now V.S.1947, § 7099 and a part of Chapter 303.
In Town of St. Johnsbury v. Sutton, 102 Vt. 451, 150 A. 133, this Court had before it the pauper settlement of four children by a first marriage when the father had died and the mother had remarried. It was there held, 102 Vt. at page 455, 150 A. 133, that the children did not retain their father's residence, citing Fairfax v. Westford, supra, 67 Vt. 390, 31 A. 847. It was also held that No. 102 of the Acts of 1906 related to the residence of the wife only and had no effect upon that of the children.
The petitionee concedes in his brief that Place, the pauper in the instant case, according to the holding in Fairfax v. Westford, supra, would have had no pauper settlement in the town of Glover upon the death of his mother in 1953. He says, however, that in 1947, there was a material revision of the statutes in regard to the settlement of minors. He refers us to No. 202 of the Acts of 1947 by which, what are *615 now V.S.1947, §§ 7100, 7101 and 7104, upon which he relies, were enacted. These sections so far as material here provide: § 7100; "The settlement of a minor child born in wedlock shall be that of his parents or surviving parent * * *." § 7101; "In the event of the death of the parent having the custody of such minor child, the settlement of such minor shall be that of the surviving parent. In case both parents die * * * the settlement of such minor at the time of such death * * * shall continue until his majority or until he shall gain a separate settlement as provided in section 7103." § 7104; "A minor upon reaching his majority shall continue to have the settlement he acquired as a minor * * or until he gains a separate settlement." Then follows a provision in this section about the settlement of one enlisting or inducted into the military service.
The petitionee claims that by these statutory changes in the law in 1947, it is clear that it was the intent of the legislature to give to minors a settlement which continues until they acquire a separate settlement in their own right. We agree with him as to that premise. He says that because of these statutory changes, although Place reached his majority in 1929, that because he was a mentally defective and unable to gain a separate settlement, the settlement that he gained as a minor prior to 1929 continued indefinitely and was not lost when his mother died. In other words he says that, although Place became of age in 1929, he was still considered a minor because he was a mental defective and, therefore, unable to gain a settlement in his own right. We do not agree.
It should be noted here that section 7102 provides for the settlement of a minor born out of wedlock and section 7103 provides how a minor may gain a separate settlement. These five sections are all a part of chapter 303 pertaining to the relief of the poor.
Sections 7100-7104, inclusive, refer to minors only except that part of section 7104 referring to persons entering the military service by reason of enlistment or induction. If the mother had died subsequent to 1929, when Place became of age and prior to 1947 when the foregoing sections became effective, his settlement with his mother would have been at an end as conceded by the petitionee. His settlement acquired from his mother continued after 1929, not because he was a minor but because he was a mental defective. The sections of the statutes that became effective in 1947, upon which the petitionee relies, apply to minors only. Place was not a minor at that time.
We hold that "minor" or "minor child" as used in these sections do not include a non-compos or mentally defective person who had reached his majority before the effective date of the statute. If the legislature had so intended, it could have said so and included such persons. As was said by Rowell, C. J., in Town of Morristown v. Hardwick, 81 Vt. 31, 33, 69 A. 152, "But care must be taken in construing statutes by implication, lest a wild olive be grafted in, and a statute cannot be thus extended beyond what is necessary to accomplish its purpose." It follows that Place did not have a pauper settlement in the town of Glover in 1956. He was a non-settled person at that time.
Did the petitioner have a clear legal right to have the bill presented to the petitionee for the care and support of Place paid by the state? Included in the definitions in section 7097, chapter 303, is; "State charge; a poor person who has no settlement in a town in this state;", also, "Non-settled person: a person who has no settlement in a town in this state;". Section 7106 provides in part; "The overseer shall relieve state charges and transient persons found or residing in his town and having no settlement in the state, and such town shall be reimbursed by the state as provided in this chapter." Section 7109 provides for notice to the overseer and also to the commissioner if the poor person is a state charge.
*616 The parties have raised a question about section 7110 having been amended in 1951, Laws 1951, No. 169, but it does not seem necessary to discuss its effect here, if any, for the petitionee in his brief after mentioning it and that part of section 7106 heretofore quoted says; "We agree with the petitioner that the legislature did not intend to deny reimbursement to the town in cases of non-settled persons." He also says; "The defendant concedes that the legislature intended that towns be reimbursed by the state in such cases as stated above." Furthermore, the agreed facts show that the notice to the petitionee and the commissioner was in proper form and timely; that the claim filed on November 15, 1956, for $260 was on a form provided by the state and that the petitionee disallowed the claim upon the ground that Place was not a non-settled person for whose care the state is responsible because he has a pauper settlement in the town of Glover, the petitioner here.
We conclude and hold upon the facts here and under chapter 303, V.S.1947, that Place is a state charge and the petitionee as the proper state official has the clear and legal duty to issue his warrant to reimburse the petitioner. Compare, Parker v. Anderson, 112 Vt. 371, 25 A.2d 41.
The remaining question is: Did the petitoner have a full adequate and complete remedy by way of declaratory relief which is a bar to mandamus action? The petitioner in discussing this question says in his brief that he has been unable to find any case in this jurisdiction dealing with the adequacy of a declaratory judgment action and he cites none from other jurisdictions. He calls our attention to three cases from this jurisdiction where mandamus was refused, as he says, on the ground of another adequate remedy. The first is Rowell v. Tunbridge, 118 Vt. 23, 98 A.2d 72. There the writ was refused because a case involving the same subject matter and the same parties was then pending in another court. The second is Town of West Rutland v. Rutland Railway L. & P. Co., 96 Vt. 413, 121 A. 755. There the writ was refused because the Public Service Commission had primary jurisdiction of the matter. The third is Farr v. Town of St. Johnsbury, 73 Vt. 42, 50 A. 548. There the town had adopted a resolution directing the selectmen to issue an order to the petitioner for $300 as compensation for damages allegedly caused to a spring by excavating for a schoolhouse. The selectmen refused to issue the order on the ground that the petitioner had no legal claim against the town and that the voters acted without authority. The petition for a writ of mandamus was dismissed and the writ refused on the ground that if the petitioner had a legal claim he had an adequate remedy in an action at law to recover it. The opinion in that case contains seven lines in our printed reports. It is not sufficiently persuasive so that we are inclined to use it as a precedent for dismissing the petition in the instant case and thus relegating the petitioner to bringing an action for declaratory relief.
On the facts in the instant case, mandamus affords a plain, speedy and adequate remedy. It is practical, efficient and prompt in its administration toward the result sought to be accomplished. In order to supersede mandamus, the other remedy must be competent to afford relief on the very subject matter in question, and be equally convenient, beneficial and effective. 55 C.J.S., Mandamus § 17(b), pp. 47-49. An action for a declaratory judgment does not meet this test. It, therefore, does not take the place of a petition for and a writ of mandamus as here used. Leahey v. Department of Water & Power of City of Los Angeles, 76 Cal.App.2d 281, 173 P.2d 69; Farmers & Merchants Bank of Cochrane, Wis. v. Billstein, 204 Minn. 224, 283 N.W. 138. The declaratory judgment act was designed to supply deficiencies in legal procedure which existed before the enactment of the statute. It was not intended as a substitute for ample *617 remedies in use before its adoption. Lisbon Village District v. Lisbon, 85 N.H. 173, 155 A. 252; Bell Tel. v. Lewis, 313 Pa. 374, 169 A. 571. See Ellis v. Cannon, 113 Vt. 511, 516, 37 A.2d 377.
Judgment that the prayer of the petition be granted without costs and that a mandate issue directing the petitionee as Auditor of Accounts to issue his warrant for the sum of $556 in favor of the petitioner.
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IN THE DISTRICT COURT OF APPEAL
FIRST DISTRICT, STATE OF FLORIDA
JEFFREY N. GRANT, FORMER NOT FINAL UNTIL TIME EXPIRES TO
HUSBAND, FILE MOTION FOR REHEARING AND
DISPOSITION THEREOF IF FILED
Appellant,
CASE NO. 1D14-2799
v.
DARLA GRANT (N/K/A
DARLA MORGAN), FORMER
WIFE,
Appellee.
_____________________________/
Opinion filed December 2, 2014.
An appeal from the Circuit Court for Leon County.
Angela C. Dempsey, Judge.
Kristin Adamson, Tallahassee, for Appellant.
Scott W. Smiley, of Thompson, Crawford & Smiley, Tallahassee, for Appellee.
PER CURIAM.
AFFIRMED.
LEWIS, C.J., VAN NORTWICK, and SWANSON, JJ., CONCUR.
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658 P.2d 372 (1983)
The STATE of Montana, Plaintiff and Respondent,
v.
Raymond M. DINNDORF, Defendant and Appellant.
No. 82-309.
Supreme Court of Montana.
Submitted January 18, 1983.
Decided February 3, 1983.
Nash & Nash, Michael P. Sand argued and Mark Gunther argued, Bozeman, for defendant and appellant.
Mike Greely, Atty. Gen., Helena, A. Michael Salvagni, County Atty., John Atkins, Sp. Asst. Deputy County Atty., argued, Bozeman, for plaintiff and respondent.
HARRISON, Justice.
Defendant appeals a sentence and judgment of the Eighteenth Judicial District entered July 28, 1982. Defendant was sentenced to ten years imprisonment for negligent homicide. Specifically, defendant asserts error for denial of his motion to withdraw his guilty pleas.
On April 11, 1982, defendant was the driver in a single-vehicle accident. His passenger died. An information was filed on April 19 charging him with negligent homicide, driving without a valid driver's license, and driving under the influence of alcohol. Defendant was arraigned on May 3, which was continued to May 10, and then to May 24, and then to July 26. On July 26, defendant pled guilty to all charges. The prosecutor recommended a ten-year sentence on the negligent homicide charge. The defense counsel then stated to the court, "I'm a little taken aback by the County Attorney's recommendation. It was my understanding that there would be no recommendation made to the Court as far as sentencing. There was a specific agreement to the effect which has been violated by the County Attorney."
The court replied: "[y]ou know the policy in the Eighteenth Judicial District, Department Number One, when there is a plea agreement, the two attorneys meet with the court reporter and their client and put it on the record. There's nothing on the record, is there?" Defense counsel responded, "[t]here is not, Your Honor." The Court proceeded to pass sentence; "on Count I, negligent homicide, you shall spend ten years in the state prison at Deer Lodge, Montana."
On July 29, defendant filed a motion to withdraw his guilty pleas. Hearing on the motion was held on August 2, 1982. At the hearing the defense attorney testified as follows:
"Q. During your representation of Mr. Dinndorf, did you have any conversations with ... the deputy county attorney for *373 Gallatin County, regarding this case? A. Yes, on several occasions.
"Q. Do you recall a conversation on or about the 24th of May, 1982? A. Yes, I do.
"Q. Do you recall the substance of that conversation? A. Yes, as I recall on May 24, I filed a motion to suppress evidence on behalf of my client. Shortly after the 9:00 o'clock hearing, I met with [the deputy county attorney] in his office as we were in the course of plea negotiations. I was informed at that time that there would be no further plea negotiations in this matter and I then asked ... what recommendation he would make to the Court if my client were to enter a plea of guilty to the charges. I was informed that there would be no recommendation made that Mr. Dinndorf's plea would be strictly to the Court." (Emphasis added.)
When the Deputy County Attorney had an opportunity to cross-examine, he declined, stating:
"Your Honor, it's the position of the state and myself that I'm not in a position to contest the testimony of [defense counsel] regarding the existence of the overture apparently made to him by myself, that I would not make a recommendation to the Court. Therefore, I wouldn't I will not contest that portion of his testimony."
Additionally, the defense attorney testified that based upon his belief that there would be no sentence recommendation he advised his client to plead guilty.
The District Court denied the motion to withdraw guilty pleas and ordered the sheriff to transport the defendant to Deer Lodge that afternoon.
Appellant argues basically that since an agreement was violated, he should have been allowed to withdraw his pleas of guilty. Respondent asserts that there never existed an agreement. Respondent relies on the fact that the procedure of the District was never followed. The District Court adopted that position, stating: "[n]ow there never was a plea agreement in this situation. There's no question about that. There may have been an offer and there may have been the jostling and moving around of attorneys as happens many times in criminal matters. There was never a plea agreement of any kind."
The fact that the District Court's procedure was not followed does not preclude the existence of an agreement. Plea bargaining agreements are subject to contract law standards, United States v. Arnett (9th Cir.1979), 628 F.2d 1162, thus oral agreements are valid and binding. This Court, in State v. Allen (1981), Mont., 645 P.2d 380, 38 St.Rep. 2192, recognized the validity of oral plea bargain agreements; the case was remanded for consideration of various factors, including whether the agreement had been orally amended.
If an agreement or promise did exist which was later violated by the prosecutor, the appellant has a very strong argument and the court should have allowed him to withdraw his guilty pleas. A United States Supreme Court case addresses this specific situation. In Santobello v. New York (1971), 404 U.S. 257, 92 S.Ct. 495, 30 L.Ed.2d 427, the defendant agreed to plead guilty to a lesser included offense in exchange for the prosecutors promise to refrain from making a sentence recommendation. The sentencing took place months later and a new prosecutor recommended a maximum sentence. The Supreme Court held that: "when a plea rests in any significant degree on a promise or agreement of the prosecutor, so that it can be said to be part of the inducement or consideration, such promise must be fulfilled." 404 U.S. at 262, 92 S.Ct. at 499, 30 L.Ed.2d at 433. This Court has cited and approved of Santobello. See State v. Allen, supra; State v. Brown (1981), Mont., 629 P.2d 777, 38 St.Rep. 953.
During argument of this case, respondent brought to our attention a recent case decided by the second circuit. There the court held that "off the record" promises made by a prosecutor are a nullity and cannot be relied upon by a defendant since the policy of the State of New York was to recognize only those plea agreements which are on the record. Siegel v. State of New York (2nd Cir.1982), 691 F.2d 620. We do not agree with the majority, rather we agree with Justice Pratt who dissented because he *374 believes that the United States Supreme Court's holding of Santobello does not allow such a ruling.
We do not decide whether there was an agreement. The central issue is whether the District Court should have allowed the defendant to withdraw his pleas of guilty. The authority for withdrawing a guilty plea is found in section 46-16-105(2), MCA; "[a]t any time before or after judgment the court may, for good cause shown, permit the plea of guilty to be withdrawn and a plea of not guilty substituted." It is well settled that the decision rests in the sound discretion of the trial court which will not be disturbed absent a showing of abuse of that discretion, and any doubts should be resolved in favor of a trial on the merits. State v. Campbell (1979), 182 Mont. 521, 597 P.2d 1146.
In effect, the District Court concluded that no agreement existed since its procedures were not followed. We find error for the court's failure to consider other factors indicating a broken promise. The court improperly denied defendant's motion to withdraw his guilty pleas. This case is remanded to allow defendant to replead.
HASWELL, C.J., and GULBRANDSON, MORRISON and SHEEHY, JJ., concur.
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169 F.3d 951
In The Matter Of: MEDWAY RANCH, INC., also known as MedwayRanch, Debtor.Beal Bank, S.S.B., Appellant,v.Medway Ranch, Inc., Appellee.
No. 98-50166.
United States Court of Appeals,Fifth Circuit.
March 12, 1999.
Charles R. Gibbs, Michael Scott Held, Jenkens & Gilchrist, Dallas, TX, for Appellant.
H. Rey Stroube, III, Jill Warren, Akin, Gump, Strauss, Hauer & Feld, Houston, TX, for Appellee.
Appeal from the United States District Court for the Western District of Texas.
Before HIGGINBOTHAM, BENAVIDES and DENNIS, Circuit Judges.
PATRICK E. HIGGINBOTHAM, Circuit Judge:
1
This bankruptcy appeal involves two notes that allowed for payment on one to count also towards the other in the absence of default on the first. We are persuaded that there was a default on the first note that was not validly waived. We conclude then that the second note has not been paid. We REVERSE the contrary decision by the district court and REMAND for further proceedings.
2
* The two contested notes were issued in the first Chapter 11 bankruptcy of Medway Ranch and at issue in its second bankruptcy. In the first bankruptcy, the Ranch executed and delivered the notes to the FDIC as liquidator of Commercial State Bank in Houston. The First Note, secured by a first lien on certain real property, evinced a debt in the principal amount of $1,300,000, owed by the Ranch to the FDIC. The Second Note, in a face amount of $445,112.44, evidences unpaid, accrued interest and costs arising from the Ranch's obligation to the FDIC.
3
Today our focus will be upon Paragraph 3 of the Second Note, which treats the crediting to the Second Note of payments made on the First Note. It provides:
4
Notwithstanding the foregoing, so long as payments are timely made on that certain First Lien Real Estate Note of even date herewith in the principal amount of $1,300,000.00 payable by Debtors to the order of FDIC (the "First Lien Note", ... ) and secured by a First Lien Deed of Trust of even date covering the property described ... (the "Collateral") no payments will be required to be made on this Note apart from payments made on the First Lien Note and every payment made on the First Lien Note from any source (except for any credit(s) against the First Lien Note by the FDIC or other holder thereof who purchases all or any part of the Collateral pursuant to foreclosure under said First Lien Deed of Trust) shall be deemed a payment of this Note as well, such that this Note will be paid in full through total payments from any source, except as limited above, of $1,150,000.00 on the First Lien Note.
5
This appeal involves, among other legal issues, the interpretation of "timely," whether the "so long as ..." phrase modifies the "no payments will be required ..." phrase, whether payments on the First Note count dollar-for-dollar on the Second Note, and the meaning of "pursuant to foreclosure." It must also be kept in mind that although the Second Note is only for $445,112.44, a total of $1,150,000.00 must be paid on the First Note before the obligation on the Second is extinguished.
6
Several provisions of the First Note are relevant as well. Paragraph 2 of the First Note provided that it was "payable in 7 semiannual payments of $5,000.00 principal plus accrued interest each commencing on the first day of the month next following 18 months after date hereof and continuing regularly every succeeding six-months thereafter," with the remainder due at maturity. Under Paragraph 3, upon the sale of any portion of the collateral property, the debtor would make a principal payment according to a specified formula, and in turn would receive a partial release from the liens. Paragraph 6 of the agreement provides that "time is of the essence." The next sentence provides that "[i]n the event of default in the payment of any installment of principal or interest when due, or in the performance of any obligation in any instrument securing payment," the holder could, with specified notice and an opportunity to cure, accelerate the note.
7
While the FDIC remained the holder of the two notes, the Ranch sold property, and the proceeds were applied according to the terms of the First Note. The Ranch did not make the third semiannual payment described in Paragraph 2 by the specified date of December 1, 1995, but the FDIC accepted a late payment. The FDIC did not then declare default or exercise any post-default remedies, including acceleration of the debt.
8
On May 31, 1996, Loan Acceptance Corporation, a subsidiary of Beal, purchased from the FDIC all of the FDIC's right, title, and interest under the First and Second Notes, as well as the accompanying deeds of trust. The Ranch's sales slowed, and it was unable to make the June 1 payment. Loan Acceptance Corporation transferred the Notes and deeds to Beal on June 6, and on July 26, Beal notified the Ranch of default and of its intent to accelerate the First and Second Notes. On November 12, Beal sent the debtor a foreclosure notice stating that unless the amount owed was paid, Beal would foreclose on the property on December 3. On December 2, however, the Ranch filed its second Chapter 11 petition, and the foreclosure was automatically stayed.
9
On December 23, the bankruptcy court heard the debtor's motion to sell certain property pursuant to an executed earnest money contract. As the first lienholder, Beal objected. The bankruptcy court conditionally approved the sale on December 30, but allowed Beal the opportunity to purchase the property by credit bidding its lien pursuant to 11 U.S.C. § 363(k). Beal bid $1,200,000, and on February 24, 1997, the bankruptcy court authorized the sale, with the bid amount to be credited against sums due on the First and Second Notes. The court's sale order expressly reserved the issue of how much was due under the Notes.
10
A dispute ensued as to how much was due. Beal maintained that $54,694.08 was due on the First Note, and that $527,867.71 was due on the Second Note, representing the entire principal of $445,112.44 plus interest of $82,755.27. The Ranch's position was that because the credit bid on the property covered by the First Note exceeded $1,150,000, this sufficed to extinguish the obligations under the Second Note, without even considering the prepetition payments the Ranch had made.
11
The Ranch filed a Motion to Determine, and Beal filed a Proof of Claim in the secured amount of $1,762,728.28. The bankruptcy court adopted the Ranch's position, concluding that the FDIC had not made a demand for payment under the Second Note, and by not demanding payment by the due dates on the First Note, the FDIC had waived any rights on the Second Note predicated on the failure to make untimely payments on the First Note. With respect to the June 1 payment, the bankruptcy court found that the debtor had defaulted, thus entitling Beal to interest on that payment. The bankruptcy court, however, did not find that any payment was untimely. It ultimately concluded that only $113,218.00, plus 18% annual interest accruing after July 8, 1997, was payable. The district court affirmed, and this appeal followed.
II
12
The Ranch contends that payments from property sales sufficed as an alternative to the semiannual payments. Indeed, Paragraph 3(c) specifies, "Any excess shall be held in an interest bearing account and applied when due to the next payment or payments due under the Note." The "excess" is the net proceeds from the property sales less the aggregate minimum partial release prices depending on the type and quantity of acreage sold. The record does not indicate the type and quantity of acreage sold in particular transactions, so we cannot determine based on arithmetic alone whether any excess remained after a $59,827.16 payment of principal on January 25, 1995. The Ranch does not assert there was excess over the $59,827.16 sufficient to cover the June 1 and December 1, 1995, payments. Rather, the Ranch accepts that there was a $5,000 payment due on December 1, 1995, and that it was not paid on that date. Moreover, the Ranch eventually made that December 1 payment, plus interest, without objecting that the funds had already been paid through excess from property sales. The bankruptcy judge's findings were not to the contrary.
13
The Ranch stresses that "timely" is ambiguous and the bankruptcy court properly considered extrinsic evidence. See Tarrant Distrib. Inc. v. Heublein, 127 F.3d 375, 377 (5th Cir.1997). This evidence showed that the required semiannual payments, though not made by the specified dates, were timely, because the Ranch had been making some payments through property sales. Determination of the parties' intent through extrinsic evidence is a question of fact and thus subject to the clearly erroneous standard. See In re Fender, 12 F.3d 480, 485 (5th Cir.1994). Thus, the Ranch presses, we should uphold the conclusion that timely does not mean on time.
14
The contract was not ambiguous. "Timely" means "by the date specified." The Ranch seeks to distinguish "timely" from "default," maintaining that even if one is in "default," payments may still be considered "timely." The agreement, however, makes timeliness and default sound like much the same thing. Paragraph 6 of the First Note strengthens this conclusion. Not only does it speak of "default in the payment of any installment of principal or interest when due," but it also declares that "time is of the essence." By this plain language a payment that is not timely is an event of default.
15
The Ranch builds its interpretive case on the testimony of Gary Miller, who indicated that Paragraph 3 of the Second Note originally provided for double-counting "so long as no default exists under" the First Note. Assuming this to be true, the change could have been merely an effort to clarify the word "default." The significance of the change, the Ranch argues, is that even if there were untimely payments on the First Note, subsequent payments on the Note still apply to the $1,150,000 due on the Second Note. This argument ignores the words "so long as," which remain part of Paragraph 3 and in ordinary parlance mean roughly "until it is not the case that." As soon as a payment is untimely, the provision, both as it currently reads and as it read before, does not permit subsequent payments on the First Note to count towards the Second.
16
The Ranch also argues that "the timely provision does not apply to 'payments from any source' that count toward the $1,150,000.00 total payment amount that triggers forgiveness of the Second Note." Under this interpretation, the timely payments relieve the debtor of the duty to make payments on the Second Note apart from payments on the First Note, but payments on the First Note "from any source" count toward the Second Note regardless of when made. This interpretation is unsupportable. The "every payment made on the First Lien Note from any source ..." phrase is preceded by an "and," which is not in turn preceded by a comma. A plain grammatical reading of the sentence thus shows that "so long as ..." applies to "every payment ...". Given the length of the provision, there is no reason that the drafters would not have split the provision into two sentences, if that accorded with the meaning intended.
17
Moreover, the interpretation fails to make sense of the provision. Under the interpretation, an untimely payment would not count toward the $445,112.44, but would still count toward the $1,150,000. The bankruptcy court apparently adopted this view. The court concluded that $1,150,000 is an "incentive number," such that none of the payments on the $445,112.44 would count until $1,150,000 in total payments were reached.
18
This interpretation cannot be squared with the text of the Note. Paragraph 3 indicates that the payments are to be credited "such that this Note will be paid in full through total payments ... of $1,150,000." The bankruptcy court's interpretation would turn "such that" into "but ... only"; "such that" suggests a qualification on how the payments will be credited, not that the payments will not be credited at all until a minimum threshold is reached. The only interpretation that takes into account the words "such that" treats each dollar of the $1,150,000 as applying proportionately, i.e. about 39 cents, towards the $445,112.44.
19
The bankruptcy court rejected this possibility, but its reasoning puts too much weight on the evolution of the language of the provision. The bankruptcy court recognized that in an earlier draft of the Second Note, the semiannual payment required was only $1,935.27, not the $5,000 required both on the First Note and on the final draft of the Second Note. Lo and behold, $1,935.27 is to $5,000 as $445,112.44 is to $1,150,000. Thus, the bankruptcy court correctly reasoned, in the original version of the Second Note, each dollar spent on the First Note was to count proportionately. Therefore, the bankruptcy court further inferred, payments on the First Note would count dollar for dollar towards the $1,150,000.
20
This final inference does not necessarily follow, since the change from $1,935.27 to $5,000 may have been made simply because it did not matter much which number was used. As long as payments were made on the First Note, no payments were required on the Second, so there was no need for the numbers to be in proportion. Thus the history is not inherently inconsistent with the final language, and that language leads unambiguously to the conclusion that payments were to be applied proportionately. We thus hold that the semiannual payments on the First Note were not "timely" under Paragraph 3 of the Second Note, and that any payments on the First Note after the first untimely payment did not count toward paying off the Second Note. This includes Beal's credit bid; even if the bid was not "pursuant to foreclosure," the credit bid occurred after default and thus did not apply to the Second Note.
III
21
Even if the payments were untimely, the Ranch argues, the FDIC waived timeliness by not objecting or by accepting the late payment. To imply a waiver of a right, however, a court still must identify conduct that is clear, unequivocal, and decisive. See Estate of Blardone v. McConnico, 604 S.W.2d 278, 282-83 (Tex.Civ.App.--Corpus Christi 1980, writ ref'd n.r.e.). It is true that the Texas courts occasionally have found a waiver of a right to accelerate a note for late payment from a repeated, consistent acceptance of late payments. See Highpoint of Montgomery Corp. v. Vail, 638 S.W.2d 624 (Tex.App.--Houston (1 Dist.) 1982, writ ref'd n.r.e.) (finding a waiver where 120 of 132 accepted payments were late); see also In re Marriage of Rutherford, 573 S.W.2d 299 (Tex.Civ.App.--Amarillo 1978, no writ) ("The holder of a note may waive the right to foreclose as to past defaults where late payments have been regularly accepted and notice has not been given that future defaults will provide the basis for foreclosure proceedings.").
22
Indeed, the Highpoint court found a waiver even where, as here, the contract included a provision indicating that acceptance of a late payment does not prejudice the creditor's right to declare default and accelerate at any other time. See Highpoint, 638 S.W.2d at 627. That provision too may be waived by repeated acceptance of late payments. See id.
23
But such a waiver has no role here. If the issue in this appeal were whether, on account of the FDIC's conduct, the Bank lost the right to accelerate the First Note, the contention would have purchase. This appeal concerns Paragraph 3 of the Second Note. That provision, as we explained, provides that double-counting shall stop as soon as a payment on the First Note is not "timely." This was a bargain for condition to non-liability on the second note. The condition failed on a late payment. Accepting late payments thereafter did not change the fact that the condition had not been performed.
IV
24
The parties have not briefed other issues relevant to determining exactly how much is owed on the notes, such as the date at which the higher default interest rate specified in the notes became effective. Rather than scour the record and make our best guess, we leave these issues to the bankruptcy and district courts. We REVERSE and REMAND for further proceedings to determine the exact amount owed under the Notes. Beal's motion to recover legal fees incurred in drafting its motion to strike is DENIED, and the remaining motions are DENIED AS MOOT.
25
REVERSED AND REMANDED.
| {
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Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
07/26/2019 08:06 AM CDT
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Nebraska Supreme Court A dvance Sheets
303 Nebraska R eports
IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
In reTrust Created by Jack Fenske, also known as
Jack B. Fenske and John B. Fenske, deceased.
Jennifer Lea Wheeler and Laura Jean Grace, now
known as Laura Jean Wilson, appellants, v.
Elkhorn Valley Bank & Trust, Trustee
of the Jack Fenske, also known as
Jack B. Fenske and John B. Fenske,
R evocable Trust, appellee.
___ N.W.2d ___
Filed June 28, 2019. No. S-18-262.
1. Decedents’ Estates: Trusts: Equity: Appeal and Error. The removal
of a trustee is a question of equity, and therefore an appellate court
reviews the issue de novo on the record.
2. Appeal and Error. In a review de novo on the record, an appellate court
reappraises the evidence as presented by the record and reaches its own
independent conclusions concerning the matters at issue.
3. Statutes. Statutory interpretation presents a question of law.
4. Judgments: Appeal and Error. An appellate court independently
review questions of law decided by a lower court.
Appeal from the County Court for Madison County: Donna
F. Taylor, Judge. Affirmed.
David P. Wilson and Jonathan M. Brown, of Walentine
O’Toole, L.L.P., for appellants.
Mark D. Fitzgerald, of Fitzgerald, Vetter, Temple & Bartell,
for appellee.
Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke,
Papik, and Freudenberg, JJ.
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IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
Papik, J.
Nebraska has adopted a section of the Uniform Trust Code
which allows a court to remove a trustee if removal is
requested by all beneficiaries, removal best serves the inter-
ests of all beneficiaries and is not inconsistent with a mate-
rial purpose of the trust, and a suitable replacement trustee is
available to serve. That provision is at issue in this appeal in
which trust beneficiaries challenge a county court order deny-
ing their petition to remove the trustee. We conclude that the
beneficiaries failed to prove that removal of the trustee was
not inconsistent with a material purpose of the trust, and there-
fore we affirm.
BACKGROUND
Jack Fenske Trust.
Jack Fenske, also known as Jack B. Fenske and John B.
Fenske, died on December 25, 1998. His last will and testa-
ment, executed about a year before his death, devised most of
his property to Elkhorn Valley Bank & Trust (the Bank), as
trustee, for the benefit of specific family members. Those fam-
ily members included the appellants in this case, Jennifer Lea
Wheeler (Jennifer) and Laura Jean Grace, now known as Laura
Jean Wilson (Laura). The trust provided as follows:
b. Ninety-five percent (95%) [of the principal bal-
ance] for my niece . . . to hold and manage the same
until the death of my said niece, with directions to said
Trustee to distribute the annual income from the corpus
of said trust to [my niece] annually, with the restriction
that there be no invasion of the corpus of this trust by
my said Trustee except for distribution for educational
expenses for my greatnieces [sic], Jennifer . . . and Laura
. . . . I further direct that upon the death of my niece . . .
the annual income from the corpus of the trust shall be
distributed in equal shares annually to my greatnieces
[sic], Jennifer . . . and Laura . . . , in equal shares. The
Trustee is specifically authorized to invade the corpus at
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IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
any time for distribution to Jennifer . . . and Laura . . .
for educational expenses.
c. At the death of Jennifer . . . and Laura . . . , the
Trustee shall distribute all remaining corpus and accumu-
lated income, if any, to the heirs of Jennifer . . . and Laura
. . . in equal shares.
Fenske’s niece died prior to Fenske, and consequently,
Jennifer and Laura began receiving income distributions from
the trust upon Fenske’s death. Trust assets were also available
to them for educational purposes. At all times relevant to these
proceedings, Jennifer had two adult children and Laura had
one adult child.
The parties do not dispute that as of September 2017, the
trust property consisted of approximately $52,000 in money
market funds, agricultural land assessed at approximately
$278,500, and a nearly $30,000 debt owed by Jennifer.
Request for Trustee’s Resignation.
It is undisputed that Jennifer, Laura, and their children
all support removing the Bank as trustee and replacing it
with David P. Wilson, Laura’s husband who is an attorney.
According to the record, in 2016, Wilson relayed a request that
the Bank voluntarily resign as trustee, citing concerns about
trust income and an intent to initiate termination of the trust.
The Bank refused to resign. It stated in a letter that the
request for the Bank’s resignation and the plan to terminate
the trust were not consistent with the material terms of the
trust, noting that a member of the Bank’s trust committee knew
Fenske personally and had some insight into why he set up the
trust as he had. The Bank offered to discuss concerns about the
trust income and the pros and cons of liquidating the trust real
estate, but received no response.
“Petition to Modify.”
On September 22, 2017, Jennifer and Laura filed a “Petition
to Modify” the trust to remove the Bank as trustee and approve
Wilson as successor trustee. They invoked Neb. Rev. Stat.
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IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
§ 30-3862(b)(4) (Reissue 2016), a provision of the Uniform
Trust Code.
According to the petition, there had been a substantial
change in circumstances and the removal of the Bank as trustee
was requested by all the qualified beneficiaries. Jennifer and
Laura further alleged that the removal of the Bank served the
interests of all the beneficiaries, that it was not inconsistent
with a material purpose of the trust, and that a suitable suc-
cessor trustee was available. In addition, Jennifer and Laura
asserted that they had completed their educational goals, that
trust administration fees had exceeded trust income in recent
years, and that Wilson was available to serve as successor
trustee free of charge.
The Bank filed a general objection to the petition to modify.
Hearing on Petition to Modify.
At the hearing on the petition to modify, Laura testified
about the operation of the trust as to herself and Jennifer. Laura
stated that she used trust funds to obtain a master of business
administration and a law degree and that she would not require
additional funds from the trust for educational purposes. Laura
testified that Jennifer also obtained money from the trust to
fund educational pursuits. To the best of Laura’s knowledge,
Jennifer would not require additional funds from the trust for
educational purposes.
As to Fenske’s intentions, Laura characterized Fenske as a
frugal man who was generous to his family, including Jennifer
and Laura. According to Laura, Fenske never married and
viewed her and Jennifer as grandchildren. Based on her knowl-
edge of him, Laura believed that Fenske established the trust to
share his assets with his family. In her opinion, removing the
Bank as trustee would not frustrate that purpose.
Laura admitted that the Bank had not committed any wrong-
doing in administering the trust. Instead, Laura expressed con-
cern about the fees the Bank was charging for its services as
trustee. Laura preferred that Wilson serve as trustee, because
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IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
she believed he had the necessary knowledge and experience
to serve as a competent trustee and he had agreed to serve
without charging fees.
Laura acknowledged, however, that reducing the fees
charged to the trust was not the only reason motivating the
effort to have the Bank removed. She testified that removing
the Bank as trustee was part of a plan, which she hoped would
culminate in the termination of the trust, the liquidation of the
trust assets, and the distribution of the proceeds to the qualified
beneficiaries in a manner yet to be determined.
Richard Stafford, the attorney who did Fenske’s estate
planning as well as other legal work, also testified. Stafford,
who had known Fenske since the 1970’s, described him
as an “old-school farmer,” for whom acquiring and holding
land was “paramount.” According to Stafford, Fenske did not
accept the notion that he was not going to own and control his
land forever.
Fenske had resisted estate planning for years until he sur-
prised Stafford by discussing a will. Stafford stated that it was
possible that Fenske’s will and trust document was drafted in
one sitting and signed on the same day. Stafford explained that
this was likely the reason Fenske’s explicit wishes were not
included in the document, as they typically would be.
However, Stafford testified that in preparing the will and
trust, Fenske expressed the desire to delay vesting in his ben-
eficiaries, because he did not believe his brothers or anyone he
knew were capable of handling his estate or his assets accord-
ing to his wishes and he did not want them “squandered.”
Stafford also testified that Fenske wanted a trustee “to keep it
together as long as it could possibly be kept together” and “to
hold on to the land for as long as possible,” because Fenske
viewed owning agricultural property as a “sign of success.”
Stafford testified that Fenske wanted the trustee to be “inde-
pendent.” Moreover, he had a history with the Bank, which
operated the only full-time trust department in the area. Fenske
also knew the Bank’s president, who still held that position
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Nebraska Supreme Court A dvance Sheets
303 Nebraska R eports
IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
at the time of trial. When asked if there was a reason why
a trustee other than the Bank could not carry out the mate-
rial purposes of the trust, Stafford replied, “No, other than
. . . the one thing that I think [Fenske] was really trying to get
away from was to have any of his relatives being in charge of
his assets.”
Regarding Fenske’s specific intentions toward the benefi-
ciaries, Stafford stated, “[Fenske] wanted to take care of [his
niece] and wanted to keep his assets together for yet another
generation while providing educational benefits and the annual
income to the interim generation.” In Stafford’s opinion,
Fenske appreciated the value of education, but he appreciated
the value of farmwork more.
A trust officer for the Bank described the assets of the trust
and the issues confronting the trustee and the beneficiaries. At
the time of trial, the trust property included some liquid assets,
but the bulk of it was composed of agricultural land that was
rented as pasture at fair market value for northeast Nebraska,
producing income that did not reflect the value of the land. The
trust officer testified that the proximity of the land to Norfolk,
Nebraska, gave the land potential for development, but sale
of the land would result in significant capital gains taxes that
would deplete the principal trust assets. Nonetheless, in its
response to the requested resignation, the Bank had expressed
a willingness to discuss concerns with the trust income and
liquidating the trust real estate.
The county court also received a summary of distributions
and fees prepared by the Bank. This indicated that in the previ-
ous 6 years, the trustee fees slightly exceeded the distributions
of income, but that nearly $240,000 in principal had also been
distributed. The Bank’s trust officer attributed the principal dis-
tributions to Jennifer’s and Laura’s educational pursuits.
County Court’s Order.
After receiving briefs from the parties, the county court
issued a written order denying the petition to remove the Bank
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Nebraska Supreme Court A dvance Sheets
303 Nebraska R eports
IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
as trustee. It found that no substantial change in circumstances
had occurred. The county court did conclude that all the
qualified beneficiaries had requested removal as required by
§ 30-3862(b)(4). However, the county court determined that it
did not have enough information to determine whether removal
would best serve the interests of all qualified beneficiaries.
Furthermore, the county court found that removal would
be inconsistent with a material purpose of the trust. On that
question, the county court emphasized that Fenske appointed
the Bank as trustee and characterized as speculation Jennifer
and Laura’s position that he appointed the Bank only because
he had no family members capable of serving as trustee. The
county court also expressed concern with Laura’s admission
that one of the purposes for removing the trustee was to seek
to have the trust terminated, a result the county court described
as inconsistent with the terms of the trust.
Finally, the county court concluded that Wilson was not
a suitable successor trustee for purposes of § 30-3862(b)(4).
While the court acknowledged Wilson’s general qualifications
to administer a trust, it found he was not suitable to serve as
trustee in this case, because he had not been nominated by
Fenske and his stated intention to terminate the trust was con-
trary to its provisions.
Jennifer and Laura now appeal.
ASSIGNMENTS OF ERROR
Jennifer and Laura assign, condensed and restated, that the
county court erred in (1) finding that they had not satisfied
all the requirements of § 30-3862(b)(4) and (2) applying a
“clearly stated provision” standard rather than a “material pur-
pose” standard.
STANDARD OF REVIEW
[1,2] Where a question of equity is presented in a trust
administration matter, appellate review of that issue is de novo
on the record. See In re Henry B. Wilson, Jr., Revocable Trust,
- 437 -
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IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
300 Neb. 455, 915 N.W.2d 50 (2018). The removal of a trustee
is a question of equity, and therefore an appellate court reviews
the issue de novo on the record. Id. In a review de novo on
the record, an appellate court reappraises the evidence as pre-
sented by the record and reaches its own independent conclu-
sions concerning the matters at issue. In re Margaret Mastny
Revocable Trust, 281 Neb. 188, 794 N.W.2d 700 (2011).
[3,4] Statutory interpretation presents a question of law. In
re Trust of Shire, 299 Neb. 25, 907 N.W.2d 263 (2018). We
independently review questions of law decided by a lower
court. Id.
ANALYSIS
Statutory Authority Governing
Trustee Removal.
We begin by setting forth the relevant statutory authority.
Section 30-3862, which became operative in 2005, is identi-
cal to § 706 of the Uniform Trust Code. It provides authority
for courts to remove trustees under various circumstances.
Relevant to this appeal, it provides:
(a) The settlor, a cotrustee, or a beneficiary may request
the court to remove a trustee, or a trustee may be removed
by the court on its own initiative.
(b) The court may remove a trustee if:
....
(4) there has been a substantial change of circum-
stances or removal is requested by all of the qualified
beneficiaries, the court finds that removal of the trustee
best serves the interests of all of the beneficiaries and is
not inconsistent with a material purpose of the trust, and a
suitable cotrustee or successor trustee is available.
This appears to be this court’s first opportunity to interpret
and apply this language. Some courts have referred to the
grounds for removal set forth above as a “no-fault” removal
provision, because it allows for removal with no showing
of wrongdoing on the part of the trustee. See, e.g., In re
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IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
McKinney, 67 A.3d 824 (Pa. Super. 2013); Litoff v. Albright,
No. NNHCV136037921S, 2014 WL 3584834 (Conn. Super.
June 17, 2014) (unpublished opinion). Instead, a court may
remove a trustee if the party seeking removal shows that (1)
removal is requested by all the beneficiaries, (2) removal of
the trustee best serves the interests of all the beneficiaries, (3)
removal is not inconsistent with a material purpose of the trust,
and (4) a suitable replacement trustee is available.
Jennifer and Laura contend that they demonstrated each of
the above elements in this case. No one disputes that removal
was requested by all the beneficiaries. But we have occasion
to address only one of the other elements that are in dispute—
whether removal of the Bank would be inconsistent with a
material purpose of the trust. Our analysis of that issue follows
in the sections below.
When Is Removal of Trustee
Inconsistent With Material
Purpose of Trust?
Before turning to whether removal of the Bank would be
inconsistent with a material purpose of the trust in this case,
we pause to consider what that question entails. Crucial to our
analysis is, of course, what it means under § 30-3862(b)(4) for
a proposed trustee removal to be “inconsistent with a mate-
rial purpose of the trust.” Nebraska’s Uniform Trust Code
does not define “material purpose.” However, the comments
to the Uniform Trust Code provide some guidance, and the
Legislature directly referred to sections of the code when
adopting it, thereby incorporating those comments. See In re
Trust of Shire, 299 Neb. 25, 907 N.W.2d 263 (2018).
The most guidance regarding the meaning of “material pur-
pose” can be found in the comment to § 411 of the Uniform
Trust Code, a provision that makes the material purposes of
a trust relevant to whether termination or modification of a
trust is permitted. See Neb. Rev. Stat. § 30-3837 (Reissue
2016). We find the comment to § 411 useful, because the
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comment to § 706 of the Uniform Trust Code explains that
it is “a specific but more limited application of” § 411. Unif.
Trust Code § 706, 7D U.L.A. 254 (2018). The comment to
§ 411 states:
In order to be material, the purpose . . . must be of some
significance: “Material purposes are not readily to be
inferred. A finding of such a purpose generally requires
some showing of a particular concern or objective on
the part of the settlor, such as concern with regard to
a beneficiary’s management skills, judgment, or level
of maturity.”
Unif. Trust Code § 411, 7D U.L.A. 160 (2018), quoting
Restatement (Third) of Trusts § 65, comment d. (2003).
The Restatement commentary quoted in the comment on
the Uniform Trust Code elaborates further on the meaning of
material purpose in this context. It provides:
Thus, a court may look for some circumstantial or other
evidence indicating that the trust arrangement repre-
sented to the settlor more than a method of allocating
the benefits of property among multiple intended ben-
eficiaries, or a means of offering to the beneficiaries
(but not imposing on them) a particular advantage.
Sometimes, of course, the very nature or design of a
trust suggests its protective nature or some other mate-
rial purpose.
Restatement, supra, § 65, comment d. at 477.
[A] particular change of trustee . . . might have the effect
of materially undermining the contemplated qualities or
independence of trustees. A given change might even
have the effect of shifting effective control of the trust in
such a way as to be inconsistent with a protective man-
agement purpose or other material purpose of the trust.
Thus, changes of trustees . . . are to be particularly but
sympathetically scrutinized for possible conflict with a
material trust purpose.
Id., comment f. at 481.
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Finally, the comment accompanying § 706 states:
Because of the discretion normally granted to a trustee,
the settlor’s confidence in the judgment of the particular
person whom the settlor selected to act as trustee is enti-
tled to considerable weight. This deference to the settlor’s
choice can weaken or dissolve if a substantial change in
the trustee’s circumstances occurs.
Unif. Trust Code, supra, § 706, 7D U.L.A. 254.
We understand the commentary set forth above to indi-
cate that the question whether the proposed replacement of
a trustee is inconsistent with a material purpose of the trust
depends on the significance to the settlor of the initial choice
of trustee. For example, there may be cases in which there is
no indication that the particular trustee or the qualities that
trustee brought to the assignment were an important con-
sideration for the settlor. In those types of cases—where the
current trustee is merely an incidental means to accomplish
ends—removal would not be inconsistent with a material pur-
pose. Courts from other jurisdictions with the same or similar
“no-fault” removal provisions have reached that conclusion.
See, e.g., Matter of Trust of Hildebrandt, 53 Kan. App. 2d
368, 388 P.3d 918 (2017) (where initial trustee was selected
by drafting attorney without input from settlor, removal
found not to be inconsistent with material purpose); In re
McKinney, 67 A.3d 824 (Pa. Super. 2013) (where trustee cho-
sen by settlor no longer existed and material purpose could
be accomplished by qualified successor trustee, removal
found not to be inconsistent with material purpose); Fleet
Bank v. Foote, No. CV020087512S, 2003 WL 22962488
(Conn. Super. Dec. 2, 2003) (unpublished opinion) (where
settlor desired only qualified services and initial trustee no
longer existed, removal found not to be inconsistent with
material purpose).
On the other hand, however, are cases in which it is impor-
tant to the settlor that a particular person or entity or a per-
son or entity with particular qualities serve as trustee. The
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Uniform Trust Code and the Restatement commentary quoted
above indicate that in those circumstances, replacement of the
selected trustee with another person or entity or a person or
entity that lacked the desired qualities would be inconsistent
with a material purpose.
As noted above, one of Jennifer and Laura’s assignments
of error is that the county court misapplied the “material pur-
pose” standard of § 30-3862(b)(4) by finding that removal of
the Bank was not permitted by the terms of the trust. While
the county court did state at one point in its order that removal
would be inconsistent “with the clearly stated provisions of
the trust,” it is not clear to us that the county court failed to
conduct a proper material purpose inquiry. And, even if it did,
it is inconsequential, as we are obligated to reach our own con-
clusion on appeal as to whether removal would be inconsistent
with a material purpose of the trust. See In re Margaret Mastny
Revocable Trust, 281 Neb. 188, 794 N.W.2d 700 (2011). We
proceed to that question now.
Removal of Bank Would Be
Inconsistent With Material
Purpose of Trust.
Unlike cases in which the settlor’s considerations must be
deduced from entirely circumstantial evidence, the record in
this case contains relatively direct evidence of what Fenske
hoped to accomplish through the trust and why he selected
the Bank to serve as trustee. As noted above, Fenske’s attor-
ney, Stafford, provided testimony regarding his understanding
of Fenske’s estate planning aims. He testified that Fenske’s
objective was “to keep [the trust assets] together as long as
[they] could possibly be kept together.” As for why the Bank
was selected as trustee, Stafford noted that Fenske had a his-
tory with the Bank and a relationship with its president and
that that person was still serving as president of the Bank at
the time of trial. Stafford also testified that Fenske wanted
a trustee who was “independent.” Stafford elaborated on the
- 442 -
Nebraska Supreme Court A dvance Sheets
303 Nebraska R eports
IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
idea of independence when he was asked if someone other
than the Bank could carry out the material purposes of the
trust. Stafford responded that “the one thing that I think
[Fenske] was really trying to get away from was to have any
of his relatives being in charge of his assets.”
Based on Stafford’s testimony and the terms of the trust,
the Bank argues that it would be inconsistent with a mate-
rial purpose of the trust to replace the Bank with Wilson.
The Bank argues that Fenske wanted the trust to be left intact
until the deaths of Jennifer and Laura and that it would be
inconsistent with his purpose if the Bank was replaced by
Wilson as part of an attempt to ultimately terminate the trust.
It does appear from both the terms of the trust and Stafford’s
testimony that it was important to Fenske that the trust assets
remain intact until the deaths of Jennifer and Laura. Jennifer
and Laura counter, however, that even if the Bank is correct
about Fenske’s wishes, Wilson could not thwart those wishes
as trustee, because he would be bound by the same legal
requirements as the Bank and the trust could be terminated
only if permitted by the court under a separate motion under
§ 30-3837.
In the end, we need not resolve whether and to what extent
Laura’s admission that this motion is part of an attempt
to terminate the trust ought to affect the material purpose
analysis, because even if it is set to the side, we would find
that removal is inconsistent with a material purpose of the
trust for another reason. Stafford testified that the Bank was
selected because Fenske wanted a trustee that was “indepen-
dent” and that he did not want a trustee that was a part of
his family. This testimony suggests that the selection of the
Bank as trustee was more than an incidental means to an end,
but that independence from his family was, for Fenske, an
important quality in a trustee. The Restatement comments we
quoted above recognize that a proposed trustee removal and
replacement “might have the effect of materially undermin-
ing the contemplated qualities or independence of trustees.”
- 443 -
Nebraska Supreme Court A dvance Sheets
303 Nebraska R eports
IN RE TRUST CREATED BY FENSKE
Cite as 303 Neb. 430
Restatement (Third) of Trusts § 65, comment f. at 481 (2003).
In our view, replacing the Bank with Wilson, Laura’s husband,
would do so here. Because we find that removal of the Bank
would be inconsistent with a material purpose of the trust, we
conclude that the county court did not err in denying Jennifer
and Laura’s motion.
CONCLUSION
For the foregoing reasons, we affirm the order of the county
court that denied Jennifer and Laura’s request to remove the
Bank as trustee.
A ffirmed.
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Case: 14-3141 Document: 7 Page: 1 Filed: 07/24/2014
NOTE: This order is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
SHEILA A. MCNAIR,
Petitioner,
v.
DEPARTMENT OF AGRICULTURE,
Respondent.
______________________
2014-3141
______________________
Petition for review of the Merit Systems Protection
Board in No. DC-0752-14-0385-I-1.
______________________
ON MOTION
______________________
ORDER
Sheila A. McNair moves for leave to proceed in forma
pauperis.
Upon consideration thereof,
IT IS ORDERED THAT:
The motion is granted.
Case: 14-3141 Document: 7 Page: 2 Filed: 07/24/2014
2 MCNAIR v. DEPARTMENT OF AGRICULTURE
FOR THE COURT
/s/ Daniel E. O’Toole
Daniel E. O’Toole
Clerk of Court
s24
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Cite as 2016 Ark. App. 71
ARKANSAS COURT OF APPEALS
DIVISION III
No. CR-15-657
Opinion Delivered February 3, 2016
DAVID ADAM JOHNSON APPEAL FROM THE INDEPENDENCE
APPELLANT COUNTY CIRCUIT COURT
[NO. CR-2013-252]
V.
HONORABLE JOHN DAN KEMP,
JUDGE
STATE OF ARKANSAS
APPELLEE AFFIRMED
LARRY D. VAUGHT, Judge
David Adam Johnson appeals his conviction by an Independence County jury of two
counts of sexual indecency with a child, a Class D felony. His sole point on appeal is that the
trial court erred in denying his motion to suppress statements he made to police during a
custodial interview. 1 He argues that the statements were not voluntary. We disagree and
affirm.
Testimony at the suppression hearing revealed that Independence County
Investigator Shane Meyer contacted Johnson by phone and asked him to come to the
sheriff’s office for an interview, which he did. Johnson was introduced to another
investigator, Ms. Kalika Rogers, who observed the entire interview. He was read his Miranda
rights, he read them, he indicated that he understood those rights, and he waived them.
Johnson was accused of soliciting sex from his wife’s twelve-year-old niece. Because
1
he has not challenged the sufficiency of the evidence supporting his conviction, a detailed
recitation of the facts is unnecessary.
Cite as 2016 Ark. App. 71
Johnson admitted early in the interview that he knew he was there to discuss allegations
against him related to inappropriate sexual conduct with his wife’s twelve-year-old niece. He
initially denied having solicited sex from her but ultimately admitted that he approached her
three times on the same evening and offered to perform oral sex on her.
Meyer told Johnson that the interview was part of a criminal investigation. He stated
that he would turn Johnson’s statement over to the prosecutor. Johnson never indicated that
he wanted to end the interview or invoke his rights. Meyer testified that Johnson did not
appear to be confused or upset. Meyer testified that he did not coerce Johnson but that he
did use tactics that involved accusing him of lying and appealing to his sense of honor and
integrity as a member of the military. At the end of the interview, Meyer asked Johnson to
write a statement, which he did on his own without help or input from either investigator.
Rogers also testified that Johnson had been read his rights, appeared to understand
them, and waived them without coercion. Both investigators testified that Johnson never
indicated that he had physical or mental impairments.
Johnson testified that he suffered from post-traumatic-stress disorder. He admitted
that he never asked for an attorney or asked to end the interview but stated that he felt
threatened by Meyer. He said he was afraid that Meyer would assault him if he did not tell
Meyer what he wanted to hear. Johnson stated that he spent twenty minutes after the
interview praying for forgiveness because he had lied in his confession but that he then
wrote a statement again admitting the allegations.
After listening to the audio recording of the interview, the trial court denied
Johnson’s motion to suppress, finding that Johnson had knowingly waived his Miranda rights
2
Cite as 2016 Ark. App. 71
of his own free will and had voluntarily participated in the interview. At trial, Johnson again
objected to the admission of his oral and written statements. His objection was overruled,
and the statements were admitted into evidence. Johnson was convicted and filed a timely
notice of appeal.
In Grillot v. State, the Arkansas Supreme Court clarified the standard of review to be
applied to our review of the denial of a defendant’s motion to suppress a custodial
confession: “[T]he voluntariness of custodial statements is tested by viewing the totality of
the circumstances.” 353 Ark. 294, 309, 107 S.W.3d 136, 144 (2003) (citing Frazier v. Cupp,
394 U.S. 731 (1969)); see also Miller v. Fenton, 474 U.S. 104 (1985)). Likewise, in reviewing a
trial court’s refusal to suppress a confession, we make an independent determination based
on the totality of the circumstances. Id. (citing Cox v. State, 345 Ark. 391, 47 S.W.3d 244
(2001); Riggs v. State, 339 Ark. 111, 3 S.W.3d 305 (1999)). The ruling will be reversed only if it
is clearly against the preponderance of the evidence. Giles v. State, 261 Ark. 413, 549 S.W.2d
479 (1977). Any conflict in the testimony of different witnesses is for the trial court to
resolve. Cox, 345 Ark. at 400, 47 S.W.3d at 250.
A statement made while in custody is presumptively involuntary, and the burden is on
the State to prove by a preponderance of the evidence that a custodial statement was given
voluntarily and was knowingly and intelligently made. Jones v. State, 344 Ark. 682, 687, 42
S.W.3d 536, 540 (2001). In order to determine whether a waiver of Miranda rights is
voluntary, this court looks to see if the confession was the product of free and deliberate
choice rather than intimidation, coercion, or deception. Id., 42 S.W.3d at 540.
3
Cite as 2016 Ark. App. 71
Johnson argues that his statements were involuntary because Meyer intimidated and
coerced him. We disagree. He was advised of his Miranda rights, indicated that he
understood them, provided no indication that he was confused or impaired, and waived
those rights of his own free will. He admitted that the transcript of the interview was an
accurate depiction of what had happened, and the transcript revealed no coercion. Both
Meyer and Rogers testified that Meyer had not unduly coerced Johnson into making the
statements. Meyer’s tactic of appealing to Johnson’s sense of integrity and honor as a
member of the military was not coercive; neither were his accusations that Johnson was lying
when Johnson denied the allegations. Both officers testified that Johnson provided no
indication that he had any mental or psychological impairments, and he appeared to be
competent. Johnson stated during the interview that he was aware of the purpose of the
interview. He was even advised that Meyer was going to the prosecutor with Johnson’s
statements. Johnson gave an oral statement confessing to having solicited sex from a minor
and then provided a matching written confession, which he wrote himself while alone in the
interrogation room. In this case, the totality of the circumstances indicates that Johnson
freely and voluntarily waived his Miranda rights and gave both oral and written statements
confessing to solicitation. We find no error and affirm.
Affirmed.
HARRISON and HIXSON, JJ., agree.
Jeremy B. Lowery, for appellant.
Leslie Rutledge, Att’y Gen., by: Ashley Driver Younger, Ass’t Att’y Gen., for appellee.
4
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125 F.3d 715
21 Employee Benefits Cas. 1657, 97 Cal. DailyOp. Serv. 7191,97 Daily Journal D.A.R. 11,688,Pens. Plan Guide (CCH) P 23937GARIZONA STATE CARPENTERS PENSION TRUST FUND, a Trust; JamesR. McDonald, Jr.; and Mark Minter, Plaintiffs-Appellants,v.CITIBANK, (ARIZONA), an Arizona banking corporation,Defendant-Appellee.
No. 94-16316.
United States Court of Appeals,Ninth Circuit.
Argued and Submitted Dec. 7, 1995.Decided Sept. 8, 1997.
1
Gerald Barrett, Ward, Keenan & Barrett, Phoenix, Arizona; Barry E. Hinkle, Van Bourg, Weinberg, Roger & Rosenfeld, San Francisco, California; Keith Overholt, Michael V. Perry, Glenn Hotchkiss, Shimmel, Hill, Bishop & Gruender, P.C., Phoenix, Arizona; Charles T. Stegall, Lee, Stegall, & Katz, P.C., Phoenix, Arizona, for plaintiffs-appellants.
2
Daniel Cracchiolo, Daryl Manhart, Ralph D. Harris, David M. Villadolid, Burch & Cracchiolo, P.A., Phoenix, Arizona, for defendant-appellee.
3
Stacey E. Elias, Trial Attorney, United States Department of Labor, Office of the Solicitor, Plan Benefits Security Division, Washington, DC, amicus curiae.
4
Appeal from the United States District Court for the District of Arizona; Robert C. Broomfield, District Judge, Presiding. D.C. No. CV-91-00958-SMM
5
Before: WALLACE and THOMPSON, Circuit Judges, and SEDWICK,* District Judge.
SEDWICK, District Judge:
6
The Arizona State Carpenters Pension Trust Fund and two other multi-employee pension trust funds (collectively referred to as "Trust Funds") and their respective trustees ("Trustees") appeal the district court's partial summary judgment and dismissal of their action against Citibank (Arizona) ("Citibank"), brought pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et. seq. ("ERISA") and state law, alleging that Citibank breached its custodial agreement by failing to notify the trustees of defaults on payments for investments made by the Trust Funds' investment managers.
7
The district court granted Citibank's partial summary judgment motion on the appellants' ERISA claims. The district court determined Citibank was not a fiduciary under ERISA. The district court also granted Citibank's motion to dismiss, determining ERISA preempted the appellants' state law claims. The district court then dismissed the appellants' entire action.
8
We have jurisdiction pursuant to 28 U.S.C. § 1291. We affirm the district court's grant of partial summary judgment on the ERISA claims. We, however, conclude the district court erred in its determination that ERISA preempted the state law claims. We also deny Citibank's request for attorneys' fees and costs on appeal. Thus, we affirm in part, reverse in part, and remand the action to the district court so that the district court can decide whether to dismiss the state law claims without prejudice, allowing the appellants to file those claims in state court, if they elect to do so.
I. BACKGROUND
A. Facts
9
Each Trust Fund is a Taft-Hartley trust fund, formed and operated pursuant to 29 U.S.C. § 186, and an employee benefit plan within the meaning of ERISA § 3(3), 29 U.S.C. § 1002(3). Each Trustee is a "named fiduciary" as that term is used in ERISA § 402(a), 29 U.S.C. § 1102(a).
10
From its acquisition of the assets and assumption of the liabilities of Great Western Bank through December 31, 1987, Citibank served as a depository and custodial agent for the Trust Funds. Citibank or its predecessors entered into "Custodial Agency Agreements" ("Agreements") with the Trust Funds. The Agreements, which the parties have stipulated are "plan documents" within the meaning of ERISA, required Citibank to perform the following services:
11
(a) Receive trust fund monies, and pay out trust fund monies as directed by the trustees or their agent.
12
(b) Receive and hold trust fund investments (and income from investments) for disposition as directed by the trustees or their agent.
13
(c) Invest and reinvest trust fund monies as directed by the trustees or their agents.
14
(d) Furnish regular reports listing (1) daily deposits of employer contributions to the trust funds, (2) the trust fund assets in the custodian bank's custody, (3) cash receipts and disbursements summaries, (4) summaries of sales or exchanges of trust fund assets, and (5) accruals of income to the trust funds.
15
The Agreements did not require Citibank to provide advice with respect to the Trust Funds' investments. In fact, the Agreements specifically limited Citibank's responsibilities and authority as follows: Citibank was not responsible for the adequacy of employers' contributions and was not obligated to enforce the payment thereof. Citibank had no duty to recommend, select or approve investments or otherwise to furnish advice with respect thereto. In acting upon any written authorization of the Trustees, Citibank was not required to ascertain whether a majority of the Trustees approved such action or whether such action was appropriately taken. Citibank was not responsible for monies or property paid or delivered to any person or company upon the written authorization of the Trustees. Citibank had no duty to prepare income tax returns and no power or duty to determine the rights or benefits of anyone claiming an interest under the Agreements or in the Trust Funds. The Agreements identified both a fund administrator and an investment counsel or manager. The Trustees delegated to each some authority to give directions to Citibank. The Trust Funds' investment manager gave written directions to Citibank to disburse monies to fund all the Trust Funds' investments.
16
Citibank provided the reports specified, but also provided reports to the investment counsel and to the Trust Funds' auditors in a format that pertained to delinquencies. In 1988, the Trustees, through sources other than Citibank, discovered that the Trust Funds had sustained substantial financial losses because the investment manager had provided imprudent investment advice. The Trustees terminated the investment manager and initiated an action in federal court, pursuant to 29 U.S.C. § 1132(a), against the investment manager to recover losses.
17
On June 14, 1991, appellants filed the present action against Citibank. An amended complaint filed on August 26, 1991, alleges breach of the custodial agreement through Citibank's failure to notify the Trustees of defaults on interest and principal payments on investments the investment manager made on behalf of the Trust Funds. The first eight counts in the amended complaint are based on ERISA, and the remaining five counts are state law claims based on breach of the custodial agreement, breach of common law fiduciary obligations, breach of the implied covenant of good faith and fair dealing, negligence, and common law fraud.
18
Appellants moved for partial summary judgment on the first three counts of the amended complaint, on the grounds that the suit is a federal cause of action under ERISA, that Citibank is an ERISA fiduciary, and that Citibank breached its agreement with appellants by failing to inform the Trustees of the Trust Fund delinquencies. Citibank initially filed a cross-motion for summary judgment and two motions to dismiss under the doctrines of abstention and preemption. Later, Citibank conceded that ERISA applies, arguing instead that Citibank was not an ERISA fiduciary, that Citibank did not breach its agreement with appellants regarding notification of delinquencies, and that ERISA preempts appellants' state law claims.
19
On February 23, 1994, the district court issued an order holding that ERISA governed the action, but that Citibank was not an ERISA fiduciary. The court denied appellants' motion for partial summary judgment and granted Citibank's cross-motion for partial summary judgment and motion to dismiss.1 Appellants moved for reconsideration, and the Secretary of Labor moved for leave to file an amicus brief in support thereof, but the court denied both motions. On July 1, 1994, the court entered a judgment of dismissal as to the entire amended complaint.
B. Statutory Scheme
1. Named and Delegated Fiduciaries
20
"In enacting ERISA, Congress set out to protect participants in employee benefit plans by establishing standards of conduct, responsibility, and obligations for fiduciaries of employee benefit plans, and by providing for appropriate remedies." Yeseta v. Baima, 837 F.2d 380, 383 (9th Cir.1988) (citing Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 43, 107 S.Ct. 1549, 1550, 95 L.Ed.2d 39 (1987)).
21
ERISA permits suits for breach of fiduciary duty only against ERISA defined fiduciaries. Gibson v. Prudential Ins. Co., 915 F.2d 414, 417 (9th Cir.1990). Although responsibility originally is vested with the "named fiduciary," ERISA § 402(a), 29 U.S.C. § 1102(a), the named fiduciary may allocate fiduciary responsibility and designate others to carry out fiduciary responsibilities. ERISA § 405, 29 U.S.C. § 1105. Under 29 U.S.C. § 1105(c)(1)(B), "[t]he instrument under which a plan is maintained may expressly provide for procedures maintained may expressly provide for procedures ... for named fiduciaries to designate persons other than named fiduciaries to carry out fiduciary responsibilities (other than trustee responsibilities) under the plan."
22
ERISA § 405(c)(3), 29 U.S.C. § 1105(c)(3) defines ERISA § 405(c)(1)(B)'s use of the term "trustee responsibility" as "responsibility ... to manage or control the assets of the plan." Generally, if an ERISA plan expressly provides for a procedure allocating fiduciary responsibilities to persons other than named fiduciaries under the plan, the named fiduciary is not liable for an act or omission of such person in carrying out such responsibility. ERISA § 405(c)(2), 29 U.S.C. § 1105(c)(2).
23
A named fiduciary also may delegate responsibility for making investment decisions to an investment manager. See ERISA § § 3(38), 402(c)(3) and 405(b); 29 U.S.C. §§ 1002(38), 1102(c)(3), and 1105(b).
24
If an investment manager or managers have been appointed under section 1102(c)(3) of this title, then, notwithstanding subsections (a)(2) and (3) and subsection (b) of this section, no trustee shall be liable for the acts or omissions of such investment manager or managers, or be under an obligation to invest or otherwise manage any asset of the plan which is subject to the management of such investment manager.
25
ERISA § 405(d), 29 U.S.C. § 1105(d).
2. Other Fiduciaries
26
ERISA § 3(21), 29 U.S.C. § 1002(21), requires a broad definition of fiduciary. Credit Managers Ass'n v. Kennesaw Life & Accident Ins. Co., 809 F.2d 617, 625 (9th Cir.1987). A fiduciary is "anyone who exercises discretionary authority or control respecting the management or administration of an employee benefit plan." Kyle Rys., Inc. v. Pacific Admin. Serv., Inc., 990 F.2d 513, 516 (9th Cir.1993). Fiduciary status under ERISA is to be construed liberally, consistent with ERISA's policies and objectives. See John Hancock Mut. Life Ins. v. Harris Trust & Sav. Bank, 510 U.S. 86, 96, 114 S.Ct. 517, 524, 126 L.Ed.2d 524 (1993). ERISA "defines 'fiduciary' not in terms of formal trusteeship, but in functional terms of control and authority over the plan, see 29 U.S.C. § 1002(21)(A), thus expanding the universe of persons subject to fiduciary duties-and to damages-under § 409(a)." Mertens v. Hewitt Assoc., 508 U.S. 248, 262, 113 S.Ct. 2063, 2071, 124 L.Ed.2d 161 (1993) (emphasis omitted).2
C. District Court Conclusions
27
The district court concluded that Citibank was not an ERISA fiduciary, for the following reasons: (1) as custodial bank for the Trust Funds, Citibank was bound by the Agreements, and the Agreements gave Citibank no discretionary authority; (2) there was no allocation of managerial responsibility, and Citibank was not permitted to act, and did not act, without the authority of the Trustees or their agents; (3) Citibank was required to follow the investment manager's directions; and (4) Citibank's obligation to report account activities did not constitute the degree of discretion necessary to create a fiduciary relationship. The court cited Yeseta, 837 F.2d at 385 (attorneys, accountants, and other professionals are not fiduciaries when they perform their usual professional functions and exercise no discretion over trust); Painters of Philadelphia Dist. Council No. 21 Welfare Fund v. Price Waterhouse, 879 F.2d 1146, 1150 (3d Cir.1989) (auditing firm that reviewed information provided by others who actually controlled assets was not a fiduciary); Brandt v. Grounds, 687 F.2d 895, 897 (7th Cir.1982) (refusing to impose fiduciary obligation upon bank for performance of non-discretionary function); and O'Toole v. Arlington Trust Co., 681 F.2d 94, 96 (1st Cir.1982) (bank acting merely as depository for trust fund, whose responsibility did not include discretionary advisor activities, was not a fiduciary). The court also held that ERISA preempted those claims alleging state causes of action.
D. Issues Presented
28
Appellants assert, and we agree, that the appeal presents the following issues:
29
1. Whether, pursuant to ERISA § 405(c)(1)(B), the trustees delegated to Citibank fiduciary responsibilities to hold, safeguard, and account for the plans' assets and income, thereby making Citibank a fiduciary under ERISA § § 3(21)(A), 404(a), 405(a), 409(a), and 502(a)(2).
30
2. Whether, by its actions, decisions, and functions, Citibank exercised sufficient authority and control respecting the management and administration of each plan so as to be a fiduciary.
31
3. Assuming, arguendo, that ERISA does not regulate the parties, relationship, whether ERISA preempts all state causes of action, thereby granting immunity to Citibank.
II. DISCUSSION
A. Standard of Review
32
Dismissal, pursuant to Fed.R.Civ.P. 12(b)(6), and summary judgment, pursuant to Fed.R.Civ.P. 56(c), are reviewed de novo. Kyle Rys., 990 F.2d at 515-17. We must determine, viewing the evidence in the light most favorable to the nonmoving party, whether there are any genuine issues of material fact, and whether the district court correctly applied the relevant substantive law. Warren v. City of Carlsbad, 58 F.3d 439, 441 (9th Cir.1995), cert. denied, 516 U.S. 1171, 116 S.Ct. 1261, 134 L.Ed.2d 209 (1996). We also review de novo the question whether ERISA preempts state law. The Meadows v. Employers Health Ins., 47 F.3d 1006, 1008 (9th Cir.1995).
B. Whether Citibank was an ERISA Fiduciary
1. Delegation of Fiduciary Status
33
Appellants argue that while Citibank initially had no responsibility for making investment decisions through the Agreements, the named fiduciaries (the Trustees) delegated to Citibank fiduciary responsibilities (to monitor for and report on material delinquencies). Appellants argue that the ERISA scheme contemplates that under ERISA § 405(c)(2), 29 U.S.C. § 1105(c)(2), the named fiduciary is relieved of its duty of care, and the delegee assumes the duty as a fiduciary and, thus, may be held accountable for the financial losses resulting from any breach of that duty. See Madden v. ITT Long Term Disability Plan for Salaried Employees, 914 F.2d 1279, 1283-84 (9th Cir.1990) named fiduciary's delegee became fiduciary when, as expressly authorized in Plan, Board of Directors designated "responsibility for carrying out all phases of the Administration of the Plan", cert. denied, 498 U.S. 1087, 111 S.Ct. 964, 112 L.Ed.2d 1051 (1991); Gelardi v. Pertec Computer Corp., 761 F.2d 1323, 1325 (9th Cir.1985) (once employer appointed plan administrator and gave it control over benefit plan, employer was no longer fiduciary).
34
The Agreements do not purport to delegate any fiduciary duty to Citibank, nor do they provide Citibank with independent authority or managerial responsibility over the operation or administration of the Trust Funds. Rather, the Agreements expressly limit Citibank's responsibilities and authority, such that Citibank had no duty to furnish advice with respect to investments, no responsibility for monies or property paid upon written authorization of the Trustees, and no power or duty to determine the rights or benefits of anyone claiming an interest in the Trust Fund. Meanwhile, the Trustees expressly delegated authority to a fund administrator and an investment manager. Therefore, there is no evidence to support appellants' contention that Citibank had been delegated responsibility or authority over the Trust Funds, beyond the non-fiduciary duties set out in the Agreements.
2. Implied Fiduciary Duty
35
Appellants argue that Citibank performed functions which constitute the exercise of discretion within the meaning of ERISA § 3(21)(A), 29 U.S.C. § 1002(21)(A), and thus, Citibank had an implied duty to report delinquencies. Appellants assert that Citibank assumed this duty by devising and controlling its own reporting system, deciding to whom reports would be disseminated, regularly analyzing the delinquency information, deciding whether it suggested a problem serious enough to warrant reporting to the Trustees, and determining that the delinquency information was sufficiently alarming to question the investment manager, but then accepting the investment manager's explanations.
36
A person or entity who performs only ministerial services or administrative functions within a framework of policies, rules, and procedures established by others is not an ERISA fiduciary. To become a fiduciary, the person or entity must have control respecting the management of the plan or its assets, give investment advice for a fee, or have discretionary responsibility in the administration of the plan. Kyle Rys., 990 F.2d at 516-18; Gibson, 915 F.2d at 417; Yeseta, 837 F.2d at 385; Gelardi, 761 F.2d at 1325, 29 C.F.R. § 2509.75-8(D-2).3 Having to make a decision in the exercise of a ministerial duty does not rise to the level of discretion required to be an ERISA fiduciary. See Mertens v. Hewitt Assoc., 948 F.2d 607, 610 (9th Cir.1991), aff'd, 508 U.S. 248, 113 S.Ct. 2063, 124 L.Ed.2d 161 (1993).
37
Citibank was obliged to furnish the Trustees with reports of account activities. Preparing reports of account activities and determining whether to use a particular format to inform the Trustees of delinquencies do not amount to an assumption of control or authority over the Trust Funds which, by the terms of the Agreements, Citibank did not have. Citibank did provide the Trustees with all information it was required to provide by the Agreements. That it also chose to provide information to the Trustee's named investment manager did not convert Citibank into a volunteer fiduciary. To hold otherwise would discourage depository institutions from voluntarily making information available to fund administrators, investment managers, and other fiduciaries. It would also risk creating a climate in which depository institutions would routinely increase their fees to account for the risk that fiduciary liability might attach to nonfiduciary work. We therefore conclude that Citibank undertook no fiduciary obligation by providing information to the investment manager.
3. Preemption of State Law Claims
38
With exceptions not applicable here, ERISA preempts state laws "insofar as they may now or hereafter relate to any employee benefit plan." ERISA § 514(a), 29 U.S.C. § 1144(a). Appellants argue that ERISA does not preempt their state law causes of action because they do not relate to the employee benefit plan. We agree.
39
There can be little doubt that Congress intended to sweep away any state law whose administration might interfere with or complicate the administration of ERISA. "Congress sought to eliminate the problem of inconsistent state and local regulation in the area of employee benefit plans by enacting express statutory preemption provisions as part of ERISA." The Meadows, 47 F.3d at 1008. Similarly, the remedies Congress created were intended to be exclusive. "The deliberate care with which ERISA's civil enforcement remedies were drafted and the balancing of policies embodied in its choice of remedies argue strongly for the conclusion that ERISA's civil enforcement remedies were intended to be exclusive." Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 54, 107 S.Ct. 1549, 1556, 95 L.Ed.2d 39 (1987).
40
Congress' desire for uniform regulation and the elimination of inconsistent obligations has fostered some rather sweeping judicial pronouncements on the scope of ERISA preemption. A state law "relates to" an employee benefit plan "if it has a connection with or reference to such a plan." Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96-97, 103 S.Ct. 2890, 2900, 77 L.Ed.2d 490 (1983). The Court recently explained in New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 115 S.Ct. 1671, 131 L.Ed.2d 695 (1995), that the "relates to" test may lead to an overly expansive view of preemption.
41
If 'relate to' were taken to extend to the furthest stretch of its indeterminacy, then for all practical purposes pre-emption would never run its course.... But that, of course, would be to read Congress's words of limitation as mere sham, and to read the presumption against preemption out of the law whenever Congress speaks to the matter with generality. Id. at 655, 115 S.Ct. at 1677.
42
With the teaching of Travelers firmly in mind, we have reexamined our original decision and conclude that the Trust Funds' state law claims against Citibank are not connected with ERISA. As we noted, but did not adequately incorporate in our earlier opinion, "there are limits to the unusually broad preemptive sweep we have afforded ERISA." Concha v. London, 62 F.3d 1493, 1505 (9th Cir.1995), cert. dismissed, --- U.S. ----, 116 S.Ct. 1710, 134 L.Ed.2d 772 (1996). In establishing where those limits may be found, the Supreme Court recognized at least three areas in which ERISA was intended to preempt state law claims, Travelers, 514 U.S. at 655-61, 115 S.Ct. at 1677-79, which the Fourth Circuit summarized in Coyne & Delany Co. v. Selman, 98 F.3d 1457 (4th Cir.1996):
43
First, Congress intended ERISA to preempt state laws that "mandate[ ] employee benefit structures or their administration."
44
. . . . .
45
Second, Congress intended to preempt state laws that bind employers or plan administrators to particular choices or preclude uniform administrative practice, thereby functioning as a regulation of an ERISA plan itself.
46
. . . . .
47
Third, in keeping with the purpose of ERISA's preemption clause, Congress intended to preempt "state laws providing alternate enforcement mechanisms" for employees to obtain ERISA plan benefits.
48
Coyne, 98 F.3d at 1468 (quoting Travelers, 514 U.S. at 658, 115 S.Ct. at 1678 (internal citations omitted)); see also California Div. Of Labor Standards Enforcement v. Dillingham Const., --- U.S. ----, ----, 117 S.Ct. 832, 838, 136 L.Ed.2d 791 (1997) (concluding court must examine objectives of ERISA and "nature of the effect" of state law on ERISA plans to determine if state law is preempted).
49
The state law claims in this case for breach of contract, breach of common law duties, negligence, and fraud fall outside the three areas discussed in Travelers and summarized in Coyne. The state law claims do not address the employee benefit structure or the administration of benefits; they are not aimed at binding employers or plan administrators to particular practices, nor do they preclude uniform administrative practices; and they are not an alternative enforcement mechanism for employees to obtain benefits. Of course, there remains the possibility that while the claims fall into another category, that category is one where preemption would also be appropriate.
50
In Coyne, the plaintiff employer (which the circuit court concluded had the status of a plan fiduciary for purposes of the litigation) pled a state law malpractice claim against an insurance consultant for professional malpractice in obtaining insurance for its ERISA plan. After concluding that the malpractice claim fell outside the three categories recognized in Travelers, the Coyne court went on to hold that the employer's malpractice claim against the insurance professionals was not preempted by ERISA, because the malpractice claim arose from state law of general application, did not depend in any way upon ERISA, and did not affect relations among ERISA entities.
51
The state law at issue in this case imposes a duty of care on all professionals, including all insurance professionals. Common law imposes the duty of care regardless of whether the malpractice involves an ERISA plan or a run-of-the-mill automobile insurance policy. Thus, the duty of care does not depend on ERISA in any way. Finally, the state law malpractice claim does not affect relations among the principal ERISA entities.
52
Coyne, 98 F.3d at 1471.
53
In the instant matter, the Trust Funds' state law claims, like those pled by the employer in Coyne, fall outside the three areas identified in Travelers. Like the claims in Coyne, the state law claims here arise from state law doctrines of general application. As in Coyne, the Trust Funds' state law claims against Citibank do not depend on ERISA. Finally, once the Trust Fund's characterization of Citibank as a fiduciary is stripped away, it is clear that the state law claims here do not affect relations among the principal ERISA entities.
This court has previously said:
54
The key to distinguishing between what ERISA preempts and what it does not lies, we believe, in recognizing that the statute comprehensively regulates certain relationships: for instance, the relationship between plan and plan member, between plan and employer, between employer and employee (to the extent an employee benefit plan is involved), and between plan and trustee. * * *
55
But ERISA doesn't purport to regulate those relationships where a plan operates just like any other commercial entity-for instance, the relationship between the plan and its own employees, or the plan and its insurers or creditors, or the plan and the landlords from whom it leases office space.
56
General American Life Ins. Co. v. Castonguay, 984 F.2d 1518, 1521-22 (9th Cir.1993).
57
As a service provider offering nonfiduciary custodial services, Citibank's relationship with the Trust Funds was no different from that between Citibank and any of its customers. In the circumstances of this case, the connection between the state common law principles and ERISA's regulation of employee benefit plans is simply too "tenuous, remote, or peripheral" to trigger preemption. See Shaw, 463 U.S. at 100 n. 21, 103 S.Ct. at 2901 n. 21.
58
We believe that Coyne provides a useful amplification of Castonguay and hold that where state law claims fall outside the three areas of concern identified in Travelers, arise from state laws of general application, do not depend upon ERISA, and do not affect the relationships between the principal ERISA participants; the state law claims are not preempted. Employing this approach we now hold that the Trust Funds' state law claims against Citibank are not preempted by ERISA.4
4. Attorneys' Fees
59
Citibank requests attorneys' fees and costs with respect to this appeal, pursuant to ERISA § 502(g)(1), 29 U.S.C. § 1132(g)(1), which permits a discretionary award of "a reasonable attorney's fee and costs of action to either party" in an action "by a participant, beneficiary, or fiduciary."
60
We apply a five-factor test to determine whether to award fees and costs. Tingey v. Pixley-Richards West, Inc., 958 F.2d 908, 909 (9th Cir.1992). Those factors are:
61
(1) the degree of the opposing party's culpability or bad faith; (2) the ability of the opposing party to satisfy an award of fees; (3) whether an award of fees against the opposing party would deter others from acting under similar circumstances; (4) whether the party requesting fees sought to benefit all participants and beneficiaries of an ERISA plan or to resolve a significant legal question regarding ERISA; and (5) the relative merits of the parties' position.
62
Id.
63
The degree of the Trust Funds' culpability or bad faith does not weigh significantly in favor of Citibank. While the Trust Funds' assertion that Citibank was an ERISA fiduciary was not consistent with the plain terms of the Agreements which the parties stipulated to be plan documents, the Trust Funds were correct in their insistence that ERISA did not preempt their state law claims.
64
The ability of the Trust Funds to satisfy an award of fees cannot be applied on the record before us. That record does not address the Trust Funds' current financial status.
65
The third factor, whether an award of fees would deter others in similar circumstances, weighs only slightly in favor of Citibank. While it is appropriate to deter litigation of claims plainly inconsistent with plan documents, it would be inappropriate to deter the pleading of viable claims that are not preempted by ERISA. Moreover, viability of the Trust Funds' state law claims did depend on establishing that Citibank was not a fiduciary (thus Citibank's status as a fiduciary would have to be examined-even if the examination might have been simplified had the Trust Funds paid more heed to the plan documents.)
66
The fourth consideration, whether Citibank sought to benefit all participants and beneficiaries of the plan or to resolve a significant legal question regarding ERISA, is " 'more appropriate to a determination of whether to award fees to a plaintiff than a defendant.' " Id. (quoting Marquardt v. North Am. Car Corp., 652 F.2d 715, 719 (7th Cir.1981)). It is therefore neutral in this case.
67
The fifth factor, the relative merits of the parties' positions, weighs heavily in favor of Citibank on the issue of its status as a fiduciary, but in favor of the Trust Funds on the issue of preemption.
68
A look at all the factors does not show that the balance struck significantly favors Citibank. Mindful that awarding appellate attorneys' fees in close cases might deter participation in the appellate process, we conclude that an award of appellate attorneys' fees to Citibank would be inappropriate.
III. CONCLUSION
69
We affirm the district court's grant of partial summary judgment on the appellants' ERISA claims. We reverse the district court's dismissal of the appellants' state law claims and remand the action to the district court to determine whether to exercise supplemental jurisdiction over the state law claims. We deny Citibank's request for attorneys' fees and costs on appeal.
70
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
*
Honorable John W. Sedwick, United States District Judge, District of Alaska, sitting by designation
1
The district court did not address counts four, seven, and eight, because no motions were filed regarding those claims. The parties later stipulated to dismiss those counts
2
The statute reads:
Except as otherwise provided in subparagraph (B), a person is a fiduciary with respect to a plan to the extent (i) he exercises any discretionary authority or discretionary control respecting management of such plan or exercises any authority or control respecting management or disposition of its assets, (ii) he renders investment advice for a fee or other compensation, direct or indirect, with respect to any moneys or other property of such plan, or has any authority or responsibility to do so, or (iii) he has any discretionary authority or discretionary responsibility in the administration of such plan. Such term includes any person designated under section 1105(c)(1)(B) of this title.
ERISA § 3(21)(A); 29 U.S.C. § 1002(21)(A).
3
29 C.F.R. § 2509.75-8 states in relevant part as follows:
D-2 Q: Are persons who have no power to make any decisions as to plan policy, interpretations, practices or procedures, but who perform the following administrative functions for an employee benefit plan, within a framework of policies, interpretations, rules, practices and procedures made by other persons, fiduciaries with respect to the plan:
(1) Application of rules determining eligibility for participation or benefits;
(2) Calculation of services and compensation credits for benefits:
(3) Preparation of employee communications material;
(4) Maintenance of participants' service and employment records;
(5) Preparation of reports required by government agencies;
(6) Calculation of benefits;
(7) Orientation of new participants and advising participants of their rights and the options under the plan.
(8) Collection of contributions and application of contributions as provided in the plan;
(9) Preparation of reports concerning participants' benefits;
(10) Processing of claims; and
(11) Making recommendations to others for decisions with respect to plan administration?
A: No. Only persons who perform one or more of the functions described in section 3(21)(A) of the Act with respect to an employee benefit plan are fiduciaries. Therefore, a person who performs purely ministerial functions such as the types described above for an employee benefit plan within a framework of policies, interpretations, rules, practices and procedures made by other persons is not a fiduciary because such person does not have discretionary authority or discretionary control respecting management of the plan, does not exercise any authority or control respecting management or disposition of assets of the plan, and does not render investment advice with respect to any money or other property of the plan and has no authority or responsibility to do so....
4
Although the parties do not specifically discuss the "refers to" prong of the "relates to" test, we also conclude the Trust Funds' state law claims are not preempted under this prong. As discussed above, the state law claims do not have a sufficient effect on the plans. See WSB Elec., Inc. v. Curry, 88 F.3d 788, 792-94 (9th Cir.1996), cert. denied, --- U.S. ----, 117 S.Ct. 945, 136 L.Ed.2d 834 (1997). The state law claims also do not "act[ ] immediately and exclusively upon ERISA plans" and "the existence of ERISA plans is [not] essential to the [state] law's operation." See Dillingham, --- U.S. at ----, 117 S.Ct. at 838
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930 F.2d 913Unpublished Disposition
NOTICE: Fourth Circuit I.O.P. 36.6 states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Fourth Circuit.UNITED STATES of America, Plaintiff-Appellant,v.Kenneth T. BROOKS, Defendant-Appellee.
No. 90-5302.
United States Court of Appeals, Fourth Circuit.
Argued Jan. 7, 1991.Decided April 19, 1991.
Appeal from the United States District Court for the District of South Carolina, at Columbia. Karen L. Henderson, District Judge. (CR-89-220)
Eric William Ruschky, Assistant United States Attorney, Columbia, S.C. (Argued), for appellant; E. Bart Daniel, United States Attorney, Columbia, S.C., on brief.
Susan Zalkin Hitt, Assistant Federal Public Defender, Columbia, S.C., for appellee.
D.S.C.
AFFIRMED.
Before PHILLIPS, MURNAGHAN and NIEMEYER, Circuit Judges.
PHILLIPS, Circuit Judge:
1
The government appeals the district court's grant of a two level sentencing reduction for acceptance of responsibility and the court's decision to depart downward from the sentencing guidelines. We find that the court's determination on acceptance of responsibility was not clearly erroneous. In addition, we find that the court's decision to depart from the guidelines was not clearly erroneous, and the extent of the departure was not an abuse of discretion. We now affirm the decision of the district court.
2
* In May 1989, Kimberly Brooks, a member of the United States Air Force, left her husband of two years, Kenneth Brooks, and moved onto Shaw Air Force Base, Sumter, South Carolina. About a month later Kimberly obtained a restraining order from the Sumter County Family Court, prohibiting Kenneth from coming to any location where Kimberly, or their son Mashod, was present, except for permitted visitation purposes.
3
After moving out, Kimberly's furniture remained in storage until July 16, 1989. On that day, Kimberly met Kenneth at a neutral location and he gave her the key to the storage shed. Later that same day, Kimberly, assisted by Kenneth Pittman and Greg Guinyard, moved her furniture from the shed to her home. After moving the furniture, Pittman and Guinyard remained at Kimberly's house, talking, playing cards, and drinking beer. About 9 p.m., Kenneth called Kimberly to say that he had some hardware for her furniture that he would bring to her house on his way to work that night. About 11:30 p.m., Kenneth knocked at Kimberly's door. On Guinyard's suggestion, she let Kenneth in.
4
What then happened was the subject of much dispute at trial. The prosecution's evidence was that Kenneth initiated an argument with Kimberly, during which he struck her. Pittman testified that he stepped into their dispute, and that Kenneth shoved him away. Pittman asserted that Kenneth then pulled out a knife and, after Kenneth stabbed him, he responded by hitting Kenneth with a broken broomstick. When Pittman then got Kimberly's gun, Kenneth fled.
5
According to Kenneth, however, things happened somewhat differently. Kenneth testified that as he approached the door to Kimberly's house, he heard a man yelling at his son Mashod. He stated that upon entering the house:
6
I went in the kitchen area, where Kenneth and Kim was, and I asked them was he hollering at my son, you know, and from there I say something to Kim, like, "You wrong for having them here this late and having them holler at your son and you here."
7
Later in his testimony, Kenneth repeated that he had been concerned about someone yelling at his son. While denying that Mashod had been mistreated, at trial both Kimberly and Pittman confirmed that Kenneth had expressed concern about mistreatment of Mashod. Pittman testified that Kenneth said: "Don't mess with my son, don't play with my son."
8
Kenneth further testified that he confronted Kimberly, telling her that she should not be allowing these men to yell at Mashod. He stated that Pittman then approached the couple, and kicked Kenneth. A fight then ensued, in which Pittman struck Kenneth with the broken broomstick. Only then, Kenneth testified, did he pull out a knife, swinging wildly and accidentally stabbing Pittman.
9
Whatever the actual course of events, Pittman was hospitalized for five days and underwent exploratory surgery to determine the extent of the knife wounds.
10
Kenneth's defense at trial was limited to justification, and in his direct testimony, he apologized to Pittman for wounding him. The jury convicted Kenneth for assault with a dangerous weapon, in violation of 18 U.S.C. Sec. 113(c). At sentencing, the district court determined the base sentencing level for the offense to be 15, and added 8 additional points for use of a dangerous weapon and for serious bodily injury. Based on its evaluation of the defendant, the probation report, and letters from counselors working with defendant, the court granted him a two level decrease for acceptance of responsibility. The court then departed from the guidelines on the basis of Kenneth's unusual state of mind at the time of the incident, including stress and despondency, and because the court believed Kimberly to be partially responsible for the incident. Based on those factors and on defendant's strong family and employer support, his lack of criminal record, and the court's general sense of the case, the court departed downward from the guidelines by eleven levels sentencing defendant to three years probation, with special conditions of six months community confinement and mental health counseling.
11
The government now appeals, contending that the court erred in granting the two level reduction for acceptance of responsibility as well as in departing downward from the sentencing guidelines.
II
12
The government argues that the district court erred in granting Brooks a two level reduction for acceptance of responsibility. Sentencing Guideline Sec. 3E1.1(a) provides for such a reduction "[i]f the defendant clearly demonstrates a recognition and affirmative acceptance of personal responsibility for his criminal conduct." In addition, application note 5 in the commentary to this section of the guidelines states:
13
The sentencing judge is in a unique position to evaluate a defendant's acceptance of responsibility. For this reason, the determination of the sentencing judge is entitled to great deference on review and should not be disturbed unless it is without foundation.
14
We therefore review the record to determine whether the district court had any foundation for its determination.
15
The court had before it considerable evidence that Kenneth had accepted responsibility for his actions. On direct examination, unsolicited, he apologized to Pittman. The probation officer opined that Kenneth had confronted his problems, admitted his culpability, and expressed contrition. Finally, the court received letters from his counselors--at a rehabilitation center where he voluntarily sought help--which confirmed that Kenneth had indeed accepted responsibility for his act and was making every effort to prevent such unacceptable behavior from recurring. In light of this substantial evidence, we cannot say that the decision of the district court was clearly erroneous or without foundation, and we affirm the court's grant of a two level reduction for acceptance of responsibility.
III
16
The government next argues that the court's downward departure from the guidelines was not warranted in law and fact. We disagree.
17
We have prescribed a three-step process for determining whether to depart from the sentencing guidelines. First, the particular aggravating or mitigating circumstance must not have been adequately taken into consideration by the Sentencing Commission; second, the facts of a case must support a finding of this sort of aggravating or mitigating circumstance; and third, the particular circumstances of the case must be of sufficient magnitude and importance to justify a departure. United States v. Summers, 893 F.2d 63, 66 (4th Cir.1990).
18
The district court here gave as its essential reason for departing the defendant's unusually distraught emotional condition at the time of the offense. The court noted that he was already suffering from extraordinary stress and despondency going into the altercation, and that this condition was then exacerbated by the circumstances, largely created by his wife, that immediately prompted the assault for which he was convicted.
19
The sentencing guidelines specifically address the appropriateness of considering mental and emotional condition of the defendant in departing from the guidelines. Section 5H1.3 states that "[m]ental and emotional conditions are not ordinarily relevant in determining whether a sentence should be outside the guidelines" (emphasis added). The guidelines therefore, on their face, imply that only ordinary, i.e., normally expectable, mental and emotional conditions attending involvement in any criminal conduct, were considered by the Commission in fixing sentencing ranges; that no effort was made to anticipate and factor in the wide variety of other, extraordinary mental and emotional conditions that might afflict particular defendants. We therefore hold that a sentencing court properly can take into account extraordinary mental and emotional conditions, i.e., conditions outside those normally to be expected in connection with any criminal conduct, in determining whether a departure is warranted.
20
Next, we conclude that the facts upon which the district court here relied in deciding to depart support its finding of such an extraordinary mental and emotional condition. As indicated, the court relied both upon the defendant's unusually distraught condition going into the critical events and upon the factors, including his estranged wife's conduct, which exacerbated that condition immediately before the physical altercation. There was evidence before the court that the defendant was already in a state of extreme despondency and emotional instability growing out of the break-up of his marriage before the evening of the assault. A short time before, he had shot himself in the stomach in an apparent suicide attempt. There was further evidence that in this state, he came upon a situation in which his wife was partying with two men in the presence of his young son, who was being disciplined by one of the men. We are satisfied that the district court properly could find in these circumstances the type of extraordinary mental and emotional condition which the guidelines specifically contemplate may be taken into account as the basis for a departure.
21
Finally, we conclude that the nature of the particular mitigating circumstance found here was such as to justify the significant departure made by the district court.
22
The court properly relied on the facts that the defendant voluntarily had sought counseling help; that he had no history of criminal conduct but did have a record of consistent employment; and that the probation officer had opined that defendant was not a violent person and would not constitute a future threat to others. The court did not abuse its discretion in concluding from these circumstances that the sentence resulting from the downward departure would serve the needs of public safety, deterrence, and rehabilitation.
23
We therefore affirm the judgment.
24
AFFIRMED.
25
MURNAGHAN and NIEMEYER, Circuit Judges, joined.
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In The
Court of Appeals
Ninth District of Texas at Beaumont
__________________
NO. 09-19-00015-CR
__________________
PEDRO GARCIA III, Appellant
V.
THE STATE OF TEXAS, Appellee
__________________________________________________________________
On Appeal from the 221st District Court
Montgomery County, Texas
Trial Cause No. 18-04-05512-CR
__________________________________________________________________
MEMORANDUM OPINION
On July 17, 2018, a Montgomery County Grand Jury indicted Pedro Garcia,
III for theft of property in an amount less than $2,500, a class A misdemeanor
enhanced to a state jail felony based on multiple prior theft convictions. See Tex.
Penal Code Ann. § 31.03(e)(4)(D). The State further alleged two enhancements for
prior felony convictions of unlawful possession of a firearm and burglary of a
habitation, elevating the offense to a second-degree felony. See id. § 12.425(b). The
1
jury found Garcia guilty of the state jail felony offense of theft of property. During
the punishment hearing, Garcia pled “true” to the additional enhancement
paragraphs for prior convictions of unlawful possession of a firearm and burglary of
a habitation. The jury found the enhancement paragraphs to be “true” and sentenced
Garcia to ten years of confinement.
Garcia’s appellate counsel filed a brief presenting counsel’s professional
evaluation of the record and concludes the appeal is frivolous. See Anders v.
California, 386 U.S. 738 (1967); High v. State, 573 S.W.2d 807 (Tex. Crim. App.
[Panel Op.] 1978). We notified Garcia of his right to file a pro se brief, but we
received no response.
We have independently examined the entire appellate record in this matter,
and we agree that no arguable issues support an appeal. We have determined that
this appeal is wholly frivolous. Therefore, we find it unnecessary to order
appointment of new counsel to re-brief the appeal. Cf. Stafford v. State, 813 S.W.2d
503, 511 (Tex. Crim. App. 1991). We affirm the trial court’s judgment.
AFFIRMED.
_________________________
CHARLES KREGER
Justice
2
Submitted on November 8, 2019
Opinion Delivered December 4, 2019
Do Not Publish
Before Kreger, Horton and Johnson, JJ.
3
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592 F.3d 1003 (2010)
Ae Ja ELLIOT-PARK, Plaintiff-Appellee,
v.
Jarrod MANGLONA; Michael Langdon; Anthony Macaranas; Department of Public Safety, Defendants-Appellants, and
Norbert Duenas Babauta, Defendant.
No. 08-16089.
United States Court of Appeals, Ninth Circuit.
Argued and Submitted May 12, 2009.
Filed January 12, 2010.
*1005 Braddock Jon Huesman, Assistant Attorney General, CNMI Office of the Attorney General, Saipan, MP, for the defendants-appellants.
George L. Hasselback and Joseph E. Horey, O'Connor Berman Dotts & Banes, Saipan, MP, for the plaintiff-appellee.
Before: ALEX KOZINSKI, Chief Judge, JAY S. BYBEE and CONSUELO M. CALLAHAN, Circuit Judges.
Opinion by Chief Judge KOZINSKI; Partial Concurrence and Partial Dissent by Judge CALLAHAN.
KOZINSKI, Chief Judge:
We consider whether law enforcement officers who are accused of failing to investigate a crime or make an arrest due to the race of the victim and that of the perpetrator are entitled to qualified immunity.
Facts
We recite the facts as Ae Ja Park Elliott[*] alleges them in her complaint. Elliott, who is racially and ethnically Korean, was driving south along 16 Highway in Papago, Saipan. Norbert Duenas Babauta, who is racially and ethnically Micronesian, was driving north along the same highway when he sped through a turn, crossed onto oncoming traffic and crashed into Elliott's car. Officer Manglona noticed the accident and approached. When Elliott asked him to call her husband, he *1006 shoved her inside her car and told her to shut up and calm down. Manglona then began conducting interviews of the witnesses, drivers and passengers. Officers Macaranas and Langdon arrived shortly thereafter and spoke to both drivers. The officers are all racially and ethnically Micronesian.
The three officers had cause to believe Babauta had been driving under the influence of alcohol: He was teetering and slurring his words, he reeked of alcohol and had bloodshot eyes, his truck bed was littered with empty beer cans and he told Manglona that he had "blacked out" while driving. Despite these obvious signs of intoxication, the officers didn't administer field sobriety or blood alcohol tests, or otherwise investigate whether Babauta had been driving drunk. Nor did the officers charge him with a DUI or any other crime or infraction. Manglona also falsely stated in his accident report that Babauta "had not been drinking."
Dr. Thomas Austin, who examined Elliott and Babauta at the hospital, called DPS to complain after he learned that Babauta hadn't been charged with a DUI. After this complaint, and perhaps some others, the Department of Public Safety (DPS) initiated an investigation, but the three officers conspired with others to obstruct the investigation and prevent prosecution of Babauta. Elliott claims the officers failed to investigate the crime or arrest Babauta because of racial animus against her as a Korean and in favor of Babauta as a Micronesian.
On a motion to dismiss, the district court found that Elliott sufficiently alleged a 42 U.S.C. § 1983 equal protection claim and a 42 U.S.C. § 1985 conspiracy and obstruction of justice claim against the officers. The district court concluded the officers weren't entitled to qualified immunity at the motion to dismiss stage. The officers bring this interlocutory appeal.
Analysis
Unlike prosecutors, who enjoy absolute immunity, police officers are entitled only to qualified immunity in section 1983 cases. See Malley v. Briggs, 475 U.S. 335, 341-43, 106 S.Ct. 1092, 89 L.Ed.2d 271 (1986). In a qualified immunity appeal, we normally look first to whether a constitutional violation was alleged and then to whether the defendants have qualified immunity as a matter of law. See Pearson v. Callahan, ___ U.S. ___, 129 S.Ct. 808, 813, 172 L.Ed.2d 565 (2009). We review the district court's decision de novo. Newell v. Sauser, 79 F.3d 115, 117 (9th Cir. 1996).
1. According to Elliott, the three police officers refused to investigate the incident because Babauta is Micronesian and Elliott is Korean. Elliott also claims that Officer Macaranas fully investigated another drunk driving accident that occurred the same evening where the victim was Micronesian but the driver wasn't. The officers don't dispute that Elliott has pled facts from which a trier of fact could infer racial discrimination.
Instead, the officers argue that individuals don't have a constitutional right to have police arrest others who have victimized them. But Elliott's equal protection claim isn't based on some general constitutional right to have an assailant arrested. Rather, she argues Babauta was given a pass by the police because of the officers' alleged racial bias not only in favor of Babauta as a Micronesian, but also against her as a Korean. And while the officers' discretion in deciding whom to arrest is certainly broad, it cannot be exercised in a racially discriminatory fashion. For example, a police officer can't investigate and arrest blacks but not whites, or Asians but not Hispanics. Police can't discriminate on the basis of the victim's race, either. We recognized as much in Estate *1007 of Macias v. Ihde, where we held that there is no right to state protection against madmen or criminals, but "[t]here is a constitutional right ... to have police services administered in a nondiscriminatory mannera right that is violated when a state actor denies such protection to disfavored persons." 219 F.3d 1018, 1028 (9th Cir.2000); see also DeShaney v. Winnebago County Dep't of Soc. Servs., 489 U.S. 189, 197 n. 3, 109 S.Ct. 998, 103 L.Ed.2d 249 (1989) ("The State may not, of course, selectively deny its protective services to certain disfavored minorities without violating the Equal Protection Clause.").
The officers concede that the Constitution protects against discriminatory withdrawal of police protection, but they claim that Elliott was not denied this right because they provided her with some police services: They called an ambulance and questioned bystanders. According to the officers, only a complete withdrawal of police protective services violates equal protection. But diminished police services, like the seat at the back of the bus, don't satisfy the government's obligation to provide services on a non-discriminatory basis. See Navarro v. Block, 72 F.3d 712, 715-17 (9th Cir.1995) (alleged policy to treat domestic violence 911 calls less urgently could form the basis for an equal protection claim). Certainly the government couldn't constitutionally adopt a policy to spend $20,000 investigating each murder of a white person but only $1,000 investigating each murder of a person of color. Likewise, it doesn't matter that Elliott received some protection; what matters is that she would allegedly have received more if she weren't Korean and Babauta weren't Micronesian.
The officers also suggest that the equal protection clause only protects against selective denial of protective services, and that investigation and arrest aren't protective services unless there is a continuing danger to the victim. But the officers' understanding of protective services is too limited. If police refuse to investigate or arrest people who commit crimes against a particular ethnic group, it's safe to assume that crimes against that group will rise. Would-be criminals will act with a greater impunity if they believe they have a get out of jail free card if they commit crimes against the disfavored group. Babauta may well have been emboldened to drive drunk with empty beer cans rolling around in the back of his truck because he believed that he would suffer no ill consequences should he cause an accident.
In any event, whether investigation and arrest are protective services is immaterial. While the Supreme Court may have written in DeShaney that the government couldn't "selectively deny its protective services" to disfavored minorities, 489 U.S. at 197 n. 3, 109 S.Ct. 998, that certainly doesn't imply that the government can selectively deny its non-protective services to disfavored minorities. The government may not racially discriminate in the administration of any of its services. See Palmer v. Thompson, 403 U.S. 217, 219-223, 91 S.Ct. 1940, 29 L.Ed.2d 438 (1971) (government-funded pools cannot be operated on a racially discriminatory basis); Hawkins v. Town of Shaw, 437 F.2d 1286, 1288 (5th Cir.1971) (municipal services cannot be provided on a racially discriminatory basis).
The dissent agrees that the discriminatory denial of investigative services may violate equal protection. Dissent at 1016. Nevertheless, our colleague questions whether Elliott has an equal protection claim based on the officers' failure to arrest Babauta because arrest decisions are entitled to deference and because Elliott probably suffered little harm. See id. at 1011. But even the dissent recognizes that police officers aren't entitled to deference *1008 for their decision if it is based on racial animus. See id. at 1010-11. And the fact that Elliott may not have been harmed much speaks more to whether she can recover anything beyond nominal damages than to whether she has an equal protection claim. See also Flores v. Morgan Hill Unified Sch. Dist., 324 F.3d 1130, 1135-36 (9th Cir.2003) (discriminatory failure to investigate and discipline student harassment complaints violates equal protection). Certainly, a plaintiff complaining of heart attack symptoms has a claim against a government hospital that turns him away because of his race, even if the symptoms turn out to be caused by heartburn. The officers' alleged discriminatory failure to arrest, as well as investigate, therefore violated equal protection.
2. Law enforcement officials are entitled to qualified immunity even where their conduct violated a constitutional right unless that right was clearly established at the time of the violation. Saucier v. Katz, 533 U.S. 194, 202, 121 S.Ct. 2151, 150 L.Ed.2d 272 (2001). The dispositive inquiry is whether "it would be clear to a reasonable officer that his conduct was unlawful in the situation he confronted." Id. Thus, our "task is to determine whether the preexisting law provided the defendants with `fair warning' that their conduct was unlawful." Flores, 324 F.3d at 1136-37 (quoting Hope v. Pelzer, 536 U.S. 730, 740, 122 S.Ct. 2508, 153 L.Ed.2d 666 (2002)).
The right to non-discriminatory administration of protective services is clearly established. See p. 1006-07 supra. Nevertheless, the officers argue that it wasn't clearly established that investigation and arrest are protective services. But the very purpose of section 1983 was to provide a federal right of action against states that refused to enforce their laws when the victim was black. See Briscoe v. LaHue, 460 U.S. 325, 338, 103 S.Ct. 1108, 75 L.Ed.2d 96 (1983) ("It is clear from the legislative debates that, in the view of the Act's sponsors, the victims of Klan outrages were deprived of `equal protection of the laws' if the perpetrators systematically went unpunished."); Monroe v. Pape, 365 U.S. 167, 174-180, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961) ("It is abundantly clear that one reason the legislation was passed was to afford a federal right in federal courts because, by reason of prejudice, passion, neglect, intolerance or otherwise, state laws might not be enforced ...."); Smith v. Ross, 482 F.2d 33, 37 (6th Cir.1973) ("Particularly in view of the circumstances surrounding the passage of § 1983, including the concern for protecting Negroes from the widespread non-enforcement of state laws, the remedies provided in § 1983 are most appropriately extended to persons who, because of the unpopularity of their life-styles or the pervasiveness of racist animus in the community, are not protected ...." (citation omitted)). It hardly passes the straight-face test to argue at this point in our history that police could reasonably believe they could treat individuals disparately based on their race.
The officers argue that Elliott's equal protection rights weren't clearly established because she can't find a case similar to herslike a sobriety check and arrest case or a traffic casewhere the court found an equal protection violation. But there doesn't need to be a prior case with materially similar facts in order for a right to be clearly established. Flores, 324 F.3d at 1136-37 ("In order to find that the law was clearly established, however, we need not find a prior case with identical, or even `materially similar,' facts." (quoting Hope, 536 U.S. at 741, 122 S.Ct. 2508)). This is especially true in equal protection cases because the non-discrimination principle is so clear. "The constitutional right to be free from such *1009 invidious discrimination is so well established and so essential to the preservation of our constitutional order that all public officials must be charged with knowledge of it." Flores v. Pierce, 617 F.2d 1386, 1392 (9th Cir.1980).
We have recognized the absurdity of requiring equal protection plaintiffs to find a case with materially similar facts. In Flores v. Morgan Hill Unified School District, we held that public school administrators who failed to respond to gay students' harassment complaints were not entitled to qualified immunity. 324 F.3d at 1136-38. The administrators argued that "no Supreme Court or Ninth Circuit case had yet established a student's right under the Equal Protection Clause ... to be protected by school administrators from peer sexual orientation harassment." Id. at 1136. But we reasoned that it was "not necessary to find a case applying the [equal protection] principle to a particular category of state officials, such as school administrators," because "[a]s early as 1990, we established the underlying proposition that such conduct violates constitutional rights: state employees who treat individuals differently on the basis of their sexual orientation violate the constitutional guarantee of equal protection." Id. at 1137. Thus, "[t]he defendants were officers of the state who had fair warning that they could not accord homosexual and bisexual students less protection." Id.
Contrary to the dissent's claim, see dissent at 1013, Flores isn't limited to the unique characteristics of the school environment. Indeed, Flores found that school administrators were on notice that they had to treat gay students the same as straight students based on a case holding that state employees in general can't irrationally discriminate on the basis of sexual orientation. 324 F.3d at 1137. The same holds true here. It's been long established that state employees can't treat individuals differently on the basis of their race. The three officers thus had a more than fair warning that failure to investigate and arrest Babauta because of race violated equal protection.
* * *
The officers admit their appeal of the district court's refusal to dismiss Elliott's section 1985 claim, which alleges that the defendants conspired to deny her equal protection, is tied to the success of their appeal of the section 1983 claim. The district court did not err in failing to dismiss the section 1983 and section 1985 claims.
AFFIRMED.
CALLAHAN, Circuit Judge, concurring and dissenting:
I agree with the first part of the majority opinion: the government may not racially discriminate in the administration of its services. See opinion at 1007. I further agree that the right to the non-discriminatory administration of protective services is clearly established. See opinion at 1007-08. Nonetheless, I write separately and dissent because I am concerned that the broad language in the majority's opinion fails to recognize the deference courts have given, and should give, police departments in determining when and how to investigate crimes. This underlying theme informs the two specific issues I address. First, I am leery of any suggestion that a person's right to equal protection extends to requiring an arrest of a third person; and second, I do not think that a reasonable officer in defendants' position was on notice that refusing to give Babauta a sobriety test might constitute a violation of Elliot's right to equal protection of the law. Of course, with the publication of this opinion Ninth Circuit law on this issue will be established.
*1010 However, I conclude that existing law did not provide the defendants with clear notice that their actions concerning Babauta violated Elliot's constitutional right to equal protection of the law. This distinction is exactly the purpose of the second prong of the test set forth in Saucier v. Katz, 533 U.S. 194, 121 S.Ct. 2151, 150 L.Ed.2d 272 (2001): "whether it would be clear to a reasonable officer that his conduct was unlawful in the situation he confronted." Id. at 202, 121 S.Ct. 2151. Accordingly, I would hold that although defendants may have violated Elliot's right to equal protection of the law, they are entitled to qualified immunity because it would not have been clear to a reasonable officer that he or she was doing so.
I
The majority's opinion fails to distinguish between investigations and arrests and thus fails to appreciate that the discretionary determination to arrest someone is particularly unsuited to judicial review. The unique nature of the prosecutorial function, which includes the decision to arrest an individual, was recognized by the Supreme Court over thirty years ago in Imbler v. Pachtman, 424 U.S. 409, 96 S.Ct. 984, 47 L.Ed.2d 128 (1976). In Imbler, the Supreme Court affirmed the Ninth Circuit's holding that a prosecuting attorney who acted within the scope of his duties in initiating and pursuing a criminal prosecution is entitled to qualified immunity from suit under 42 U.S.C. § 1983 "for alleged deprivations of the defendant's constitutional rights." Id. at 410, 96 S.Ct. 984. In Wayte v. United States, 470 U.S. 598, 607, 105 S.Ct. 1524, 84 L.Ed.2d 547 (1985), the Court reiterated that "the Government retains `broad discretion' as to whom to prosecute" and that this "broad discretion rests largely on the recognition that the decision to prosecute is particularly ill-suited to judicial review."
The prosecutor's discretion, however, is "subject to constitutional restraints." United States v. Armstrong, 517 U.S. 456, 464, 116 S.Ct. 1480, 134 L.Ed.2d 687 (1996) (quoting United States v. Batchelder, 442 U.S. 114, 125, 99 S.Ct. 2198, 60 L.Ed.2d 755 (1979)). In Armstrong, the Court explained:
One of these constraints, imposed by the equal protection component of the Due Process Clause of the Fifth Amendment, Bolling v. Sharpe, 347 U.S. 497, 500, 74 S.Ct. 693, 98 L.Ed. 884 ... (1954), is that the decision whether to prosecute may not be based on "an unjustifiable standard such as race, religion, or other arbitrary classification," Oyler v. Boles, 368 U.S. 448, 82 S.Ct. 501, 7 L.Ed.2d 446, ... (1962). A defendant may demonstrate that the administration of a criminal law is "directed so exclusively against a particular class of persons ... with a mind so unequal and oppressive" that the system of prosecution amounts to "a practical denial" of equal protection of the law. Yick Wo v. Hopkins, 118 U.S. 356, 373, 6 S.Ct. 1064, 30 L.Ed. 220 ... (1886).
In order to dispel the presumption that a prosecutor has not violated equal protection, a criminal defendant must present "clear evidence to the contrary." [United States v.] Chemical Foundation,... [272 U.S. 1] ... 14-15 [47 S.Ct. 1, 71 L.Ed. 131] [(1926)].... We explained in Wayte why courts are "properly hesitant to examine the decision whether to prosecute." 470 U.S., at 608, 105 S.Ct. 1524,.... Judicial deference to the decisions of these executive officers rests in part on an assessment of the relative competence of prosecutors and courts. "Such factors as the strength of the case, the prosecution's general deterrence value, the Government's enforcement priorities, and the case's relationship to the Government's overall enforcement plan *1011 are not readily susceptible to the kind of analysis the courts are competent to undertake." Id. at 607, 105 S.Ct. 1524, .... It also stems from a concern not to unnecessarily impair the performance of a core executive constitutional function. "Examining the basis of a prosecution delays the criminal proceeding, threatens to chill law enforcement by subjecting the prosecutor's motives and decisionmaking to outside inquiry, and may undermine prosecutorial effectiveness by revealing the Government's enforcement policy." Ibid.
517 U.S. at 464-65, 116 S.Ct. 1480.[1] The Court went on to reaffirm that "[t]o establish a discriminatory effect in a race case, the claimant must show that similarly situated individuals of a different race were not prosecuted." Id. at 465, 116 S.Ct. 1480.
These cases, indeed almost all cases concerning selective prosecution, are brought by individuals who are challenging their prosecutions by the government. Here, Elliot's assertion is not that she was selectively prosecuted, but that her constitutional right to equal protection was violated by the officers' failure to investigate and arrest a third party, Babauta. As the decision to arrest and prosecute an individual is entitled to substantial deference from the courts, it follows that the decision not to arrest and prosecute a person is entitled to at least the same degree of deference. This does not suggest that it would be impossible for a plaintiff to allege and show that her right to equal protection was violated by an officer's failure to arrest a third party, but only to clarify that the decision to arrestas opposed to the officer's duty to investigateis part of the prosecutorial function and is therefore entitled to greater deference.
In addition, as a practical matter, it is not clear how Elliot was harmed by the defendants' failure to arrest Babauta. Certainly the failure to give him a sobriety test or to otherwise investigate his competency to drive may well have collateral consequences for Elliot. But had the defendants investigated Babauta's competency to drive, it is doubtful whether Babauta's arrest would have had any impact on Elliot. Accordingly, because the failure to arrest Babauta had little impact on Elliot and because the determination of whether to arrest an individual is entitled to enhanced deference, I question whether the failure to arrest Babauta constitutes a violation of Elliot's right to equal protection of the law.
In sum, I agree with the essence of the majority's opinionthat Elliot has a constitutional right not to have police services denied because of racebut would not *1012 hold that police services necessarily include the decision to arrest a third party.[2]
II
The majority's failure to distinguish between the police officers' duty to investigate and the decision to arrest a third party is symptomatic of its failure to consider the meaning of "protective services" when applying the second prong of the Saucier test. The second prong of the Saucier test requires an inquiry into "whether it would be clear to a reasonable officer that his conduct was unlawful in the situation he confronted." Saucier, 533 U.S. at 202, 121 S.Ct. 2151. A careful review of the cases cited by the majority reveals that despite the language cited by the majority, they fail to place a reasonable officer in defendants' position on notice that his actions related to Babauta constituted a violation of Elliot's constitutional right to equal protection of the law.
The majority address the second prong of the Saucier test in broad strokes. It starts with the premise that the "right to non-discriminatory administration of protective services is clearly established" (opinion at 1008), comments that "there doesn't need to be a prior case with materially similar facts in order for a right to be clearly established," (opinion at 1008), asserts that "[w]e have recognized the absurdity of requiring equal protection plaintiffs to find a case with materially similar facts," (opinion at 1009), and concludes that the "officers thus had a more than fair warning that failure to investigate and arrest Babauta because of race violated equal protection." Opinion at 1009.
The simplicity of this approach is of little comfort or guidance to the police officers whose qualified immunity is dependant on their understanding of case law. As indicated, I agree with the majority that the Supreme Court has held that the government may not "selectively deny its protective services to certain disfavored minorities without violating the Equal Protection Clause." DeShaney v. Winnebago County Dep't of Soc. Servs., 489 U.S. 189, 197 n. 3, 109 S.Ct. 998, 103 L.Ed.2d 249 (1989) (emphasis added). I also agree that this quote from DeShaney does not imply that the "government can selectively deny its non-protective services to disfavored minorities." See opinion at 1007. But this leaves unanswered the question of whether the defendants were on notice that their treatment of a third party, Babauta, constituted a violation of Elliot's right to equal protection of the law.
First, the defendants' actions concerning Babauta are not clearly within a commonsense meaning of "police protection." Here, the officers responded to the accident, inquired as to Elliot's injuries, called for an ambulance, and saw that she was safely transported to the hospital. Also, there was no possible additional harm to Elliot from Babauta following the accident as the police ensured that he was transported to the hospital and he was subsequently released to a friend or relative who drove him home. What the defendants failed to do, and what I agree may constitute a violation of Elliot's right to equal protection, was to investigate Babauta's alleged intoxication.[3] The failure to *1013 investigate an accident may fit within the definition of "protective services," but such a conclusion is by no means compelled.
Second, an examination of the cases cited by the majority fails to reveal any clear notice, or "fair warning," that an officer's treatment of one person will constitute the denial of "protective services" to another person. The opinion relies heavily on Flores v. Morgan Hill Unified Sch. Dist., 324 F.3d 1130 (9th Cir.2003). Flores, however, is both factually and legally distinguishable and thus did not give the officers reasonable notice. It is factually distinct because it concerned the alleged failure of high school administrators to protect students from "student-to-student anti-homosexual harassment." Id. at 1132. School administrators have a unique relationship with the students. See Morse v. Frederick, 551 U.S. 393, 406-08, 127 S.Ct. 2618, 168 L.Ed.2d 290 (2007) (noting the "special characteristics of the school environment"). Indeed, the court in Flores recognized that "the defendants believed that, under District policies, harassment of any kind would not be tolerated." 324 F.3d at 1135. Police officers, however, do not have a relationship to the public or even to accident victims that is similar to a high school administrators relationship to a student. Moreover, Elliot does not allege a failure to "protect."
Flores is legally distinct because in that case we held that prior court cases had placed the defendants on notice that failure to enforce the school district's policies concerning sexual orientation violated the constitution. Id. at 1137 (citing High Tech Gays v. Defense Indus. Sec. Clearance Office, 895 F.2d 563, 573-74 (9th Cir.1990)) (establishing that "state employees who treat individuals differently on the basis of their sexual orientation violate the constitutional guarantee of equal protection"). Flores indicated that a "right" need not be spelled out in a statute or federal regulation, and that there need not be a prior case that "defined the scope of a school administrator's duty." Id. Nonetheless, our task remained "to determine whether the preexisting law provided the defendants with `fair warning' that their conduct was unlawful." Id. We concluded that case law alone could render the law "clearly established," and in that existing case law had done so. Id.
Thus, Flores offers a standard for determining the existence of a clearly established right, but it does not answer the question of what case law, regulation, or statute placed the defendants in this case on notice that failing to give Babauta a sobriety test would violate Elliot's constitutional right to equal protection of the law.
The other cases cited by the majority do not fill this gap. The opinion cites Estate of Macias, 219 F.3d 1018, 1028 (9th Cir. 2000), which concerned a tragic situation where the police allegedly provided a woman inferior police protection from her estranged husband who then murdered her. On appeal, the issue before us was whether "the policy or custom caused the constitutional deprivation." Id. at 1027. We noted that "the district court assumed, without actually deciding that Mrs. Macias was deprived of her constitutional right to the equal protection of the laws." Id. Thus, our decision in Macias offers very little guidance on what type of police action or inaction violates a person's constitutional right to equal protection of the law.
Moreover, in Macias we went on to determine that the district court had erred *1014 in concluding that the denial of police protection caused Mrs. Macias' death. In doing so the court did state, as noted by the majority, that "[t]here is a constitutional right, however, to have police services administered in a nondiscriminatory mannera right that is violated when a state actor denies such protection to disfavored persons." Id. at 1028. As the failure to protect Mrs. Macias from her husband was determined not to have been the cause of Mrs. Macias's death, the quoted language appears to be dicta. Furthermore, Macias clearly concerned protection, whereas the officers' actions at issue in this case had no impact on Elliot's "protection." The case cannot reasonably be read as giving the defendants a "fair warning" that the failure to test Babauta for alcohol would violate Elliot's right to equal protection of the law.
In addition, the reference to DeShaney, 489 U.S. at 189, 109 S.Ct. 998, in the majority opinion in this case provides little guidance. In DeShaney, the Supreme Court basically held that a state had no constitutional duty to protect a child from his father after receiving reports of possible abuse. Id. at 191, 109 S.Ct. 998. This is clearly not analogous to the situation presented in this case. Moreover, the majority only cites to the language in a footnote: "[t]he State may not, of course, selectively deny its protective services to certain disfavored minorities without violating the Equal Protection Clause." Opinion at 1007 (quoting DeShaney, 489 U.S. at 197 n. 3, 109 S.Ct. 998) (emphasis added). This raises, but does not answer, the question of what constitutes a "protective service." DeShaney does not address this question because, as the Supreme Court noted, "no such argument has been made here." Id.
The majority also cites Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961), but does not suggest how Monroe would have put the officers in this case on notice that their actions violated Elliot's constitutional right to equal protection.[4]
In addition, the majority cites the Sixth Circuit's opinion in Smith v. Ross, 482 F.2d 33 (6th Cir.1973). In Ross, a deputy sheriff was alleged to have tried to "persuade" an inter-racial band to leave the building it had rented. The district court dismissed the complaint, the band members appealed, and the Sixth Circuit affirmed. Id. at 36-37. The majority's opinion in our case includes the following quote from Ross: "Particularly in view of the circumstances surrounding the passage of § 1983, including the concern for protecting Negroes from the widespread non-enforcement of state laws, ... the remedies provided in § 1983 are most appropriately extended to persons who, because of the unpopularity of their life style or the pervasiveness of racist animus in the community, are not protected ..." Opinion at 1008 (quoting Ross, 482 F.2d at 37).
The usefulness of the quoted language is weakened when it is considered in the context of the Ross opinion. The Sixth Circuit goes on to state:
We agree with appellants that a law enforcement officer can be liable under § 1983 when by his inaction he fails to perform a statutorily imposed duty to enforce the laws equally and fairly, and thereby denies equal protection to persons legitimately exercising rights guaranteed them under state or federal law. Acts of omission are actionable *1015 in this context to the same extent as are acts of commission.
Id. at 36-37 (emphasis added). Thus, even assuming that the police in the Northern Mariana Islands may be held to be on notice of a 1973 Sixth Circuit opinion, it is doubtful that they would have gleaned much guidance from the opinion. It is difficult to conclude that the defendants' failure to test Babauta for alcohol denied "equal protection to[Elliot for] legitimately exercising rights guaranteed [her] under state or federal law." Id. at 36-37.
Finally, the majority cites Flores v. Pierce, 617 F.2d 1386 (9th Cir.1980), which concerned allegations that city officials had discriminated against the Mexican-American plaintiffs on the basis of race or national origin in delaying the issuance of a liquor license. The majority opinion quotes the following sentence from Pierce: "[t]he constitutional right to be free from such invidious discrimination is so well established and so essential to the preservation of our constitutional order that all public officials must be charged with knowledge of it." Opinion at 1008-09 (quoting Flores, 617 F.2d at 1392). "Such invidious discrimination," however, is defined in Flores in the preceding sentence, which reads: "No official can in good faith impose discriminatory burdens on a person or group by reason of a racial or ethnic animus against them." Id. (emphasis added). In the present case, it is difficult to conceive of the defendants' failure to test Babauta for alcohol as imposing a discriminatory burden on Elliot.
The allegations in Benigni v. City of Hemet, 879 F.2d 473 (9th Cir.1989), are arguably closer to the facts in this case, but our opinion there does not provide the type of fair warning necessary under Saucier's second prong. In Benigni, the plaintiff, an owner of a bar, filed an action under § 1983 against city police officers alleging that they harassed his customers with the intent of forcing him to sell his business. Id. at 475. The case went to trial, where the jury's verdict was mostly in favor of plaintiff, and the city and certain police officers appealed. Id.
We recognized that Benigni could maintain an equal protection claim.[5]Id. at 477. However, we held that "we need not rule directly on the equal protection claims since the general verdict in this case is sustainable under the standards enunciated in Traver v. Meshriy, 627 F.2d 934, 938-39 (9th Cir.1980)." Id. at 478. We concluded that "Benigni's due process theory was clearly supported by evidence and is legally correct," and noted that "the due process and equal protection theories in this case are practically identical, both being grounded on the allegation of arbitrary law enforcement activity for the purpose of harassment and interference." Id. (emphasis added). Benigni informs us that police action against third parties (Benigni's customers) may amount to a denial of equal protection to the plaintiff (Benigni) when motivated by race discrimination. But the opinion also requires a "purpose of harassment and interference" which Elliot has not alleged and probably cannot allege.
In sum, although I agree that case law holding that it is unconstitutional for officers to discriminate based on race now extends to an alleged failure to provide police services, including the investigation of an automobile accident, this position was not so clearly established as to defeat defendants' claim of qualified immunity. Indeed, all the language in the relevant cases *1016 concerning "protective services," "persons legitimately exercising rights," "discriminatory burdens" and even "purpose of harassment and interference" would be unnecessary if any action by a police officer allegedly taken based on racial animus inherently violated someone's right to equal protection of the law. More is necessary to ensure that the officer knows or should know that his inaction with respect to one person violates another person's constitutional right to equal protection of the law.
III
A unique feature of the second prong of the Saucier test is precisely that it applies only when a plaintiff's constitutional right has been violated.[6] Accordingly, our focus must shift from the plaintiff's rights and injury, to what the officer knew, or should have known, concerning the plaintiff's constitutional rights.
In Saucier, the Supreme Court explained: "if a violation could be made out on a favorable view of the parties' submissions, the next sequential step is to ask whether the right was clearly established," and commented that "it is vital to note" that this inquiry "must be undertaken in light of the specific context of the case, not as a broad general proposition." 533 U.S. at 201, 121 S.Ct. 2151. Indeed, the Court proceeded to explain that in the case before it, it was not enough that the law "clearly establishes the general proposition that use of force is contrary to the Fourth Amendment if it is excessive under objective standards of reasonableness." Id. at 201-02, 121 S.Ct. 2151. Instead, it reiterated that:
the right the official is alleged to have violated must have been "clearly established" in a more particularized, and hence more relevant, sense: The contours of the right must be sufficiently clear that a reasonable official would understand that what he is doing violates that right .... The relevant, dispositive inquiry in determining whether a right is clearly established is whether it would be clear to a reasonable officer that his conduct was unlawful in the situation he confronted.
Id. at 202, 121 S.Ct. 2151 (internal citation omitted).
This is the inquiry that the majority opinion fails to undertake "in light of the specific context of the case, not as a broad general proposition." Id. at 201, 121 S.Ct. 2151. The majority leaps from the general proposition that police services cannot be denied on the basis of race to the fact-specific conclusion that the officers should have known that a failure to give Babauta a sobriety test and arrest him violated Elliot's constitutional rights. As noted in the prior section, there is no case law that even arguably assists the majority in this flight of reason. There is no suggestion that the officers had any heightened responsibility to Elliot or that there was a state created danger. See Kennedy v. City of Ridgefield, 439 F.3d 1055, 1059 (9th Cir.2006) (holding that an officer was not entitled to qualified immunity because a jury could find that he created a false *1017 sense of security). Rather, the majority concludes that because everyone knows that police services may not be denied because of race, the officers were on notice.
But in Saucier, the Court held that despite clearly established law that the use of excessive force was unconstitutional, this was not sufficient to place the defendant officer on notice that his shoving a person into the van constituted excessive force. Indeed, the Supreme Court concluded that despite the clearly established law on the use of excessive force, under the specific circumstances in that case, the defendant was entitled to qualified immunity.[7]
Furthermore, we have held that the plaintiff has the burden of establishing the second prong of Saucier. Kennedy, 439 F.3d at 1065. Thus, the failure of any of the cases cited by Elliot, or by the majority, to address a similar factual situation i.e., that an officer may deny one person equal protection of law by failing to investigate a third personsupports the district court's grant of qualified immunity. Of course, as indicated by our determination that defendants did violate Elliot's right to equal protection of law, a particularly prescient officer might have foreseen that his inaction would violate Elliot's right. But this is not the standard established by the Supreme Court in Saucier and reaffirmed in Pearson. Neither Elliot nor the majority cites any authority that fairly placed the officers on notice that cases denying qualified immunity for the denial of "protective services" allegedly on racial grounds would apply to all police services, including a determination of whether to investigate a third person. Accordingly, I would affirm the district court's finding of qualified immunity.
NOTES
[*] The district court caption refers to Elliott as "Elliot-Park," and our caption follows the district court. Elliott explains on appeal that her correct name is "Ae Ja Park Elliott," which is the name we use in our opinion. Elliott may request that the district court docket be corrected by motion on remand.
[1] Chief Judge Kozinski has acknowledged the deference owed to the decision whether or not to prosecute. In his dissent from the denial of rehearing en banc in United States v. Mussari, 168 F.3d 1141, 1143 (9th Cir.1999), he wrote:
The majority's complaint is that they did not give Mussari a pass for violating federal law. But whom to prosecute and whom to leave alone is the heart and soul of prosecutorial discretion, a decision committed to the Executive Branch and "particularly illsuited to judicial review." Wayte v. United States, 470 U.S. 598, 607, 105 S.Ct. 1524, 84 L.Ed.2d 547, ... (1985).
He further commented:
Reexamining prosecutorial decisions "entails systemic costs," such as delaying justice, chilling law enforcement, and "undermin[ing] prosecutorial effectiveness by revealing the Government's enforcement policy." Id. By injecting themselves into a process in which judges have no legitimate role to play, the majority has compromised the neutrality of the court and taken us into the treacherous waters of politics.
Id. at 1143.
[2] Furthermore, I do not read the opinion as suggesting that courts should not continue to give considerable deference to the decisions of police departments on how they conduct investigations and perform their functions. While we hold that the "government may not racially discriminate in the administration of any of its services" (opinion at 1007), the burden remains on a plaintiff to show that an alleged denial of services was due to racial animus and not some other reason.
[3] Because this appeal arises from a motion to dismiss on the basis of qualified immunity, we accept Elliot's allegation of racial discrimination as true. On remand, she will have the burden of showing that the officers' failure to investigate was racially motivated, and the officers will have an opportunity to present evidence that their actions were not racially motivated.
[4] Monroe held that allegedly illegal actions of city police officers respecting unreasonable search and seizure constituted actions taken "under color of" a state statute for the purposes of 42 U.S.C. § 1983, but that the municipal corporation was not a person within the meaning of the statute.
[5] We noted that "[e]lements of an intentional discrimination claim are present in this case because the evidence tends to show the discriminatory effect of greater law enforcement activity at the Silver Fox than at other bars, and the discriminatory intent of singling out Benigni based on his Italian ancestry." 879 F.2d at 477.
[6] The Supreme Court has held that in some instances a court may find qualified immunity without making a constitutional ruling under the first prong of the Saucier test. Pearson v. Callahan, ___ U.S. ___, 129 S.Ct. 808, 818, 172 L.Ed.2d 565 (2009) ("There are cases in which it is plain that a constitutional right is not clearly established but far from obvious whether in fact there is such a right."). The Court, however, reiterated that a determination of notice under the second prong of the Saucier test is premised on the assumption of a constitutional violation. Id. at 816, 129 S.Ct. 808 (noting that "if the plaintiff has satisfied this first step, the court must decide whether the right at issue was `clearly established' at the time of defendant's alleged misconduct").
[7] The Court commented that "[a] reasonable officer in petitioner's position could have believed that hurrying respondent away from the scene, where the Vice President was speaking and respondent had just approached the fence designed to separate the public from the speakers, was within the bounds of appropriate police responses." Saucier, 533 U.S. at 208, 121 S.Ct. 2151.
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 98-7308
LONNIE LEE CARR,
Petitioner - Appellant,
versus
RON ANGELONE; MARK EARLEY,
Respondents - Appellees.
Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria. Albert V. Bryan, Jr., Senior
District Judge. (CA-98-951)
Submitted: October 27, 1998 Decided: November 10, 1998
Before LUTTIG and MICHAEL, Circuit Judges, and BUTZNER, Senior
Circuit Judge.
Dismissed by unpublished per curiam opinion.
Lonnie Lee Carr, Appellant Pro Se.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Appellant appeals the district court’s order denying relief on
his petition filed under 28 U.S.C.A. § 2254 (West 1994 & Supp.
1998). We have reviewed the record and the district court’s opinion
and find no reversible error. The district court properly concluded
that Appellant’s petition was time-barred because it was filed more
than one year after Appellant’s conviction became final. Accord-
ingly, we deny a certificate of appealability and dismiss the ap-
peal on the reasoning of the district court. Carr v. Angelone, No.
CA-98-951 (E.D. Va. July 16, 1998). We deny Appellant’s motion for
oral argument because the facts and legal contentions are adequate-
ly presented in the materials before the court and argument would
not aid the decisional process.
DISMISSED
2
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749 F.2d 1199
36 Fair Empl.Prac.Cas. 743,35 Empl. Prac. Dec. P 34,816, 53 USLW 2310
James M. DAY, Plaintiff-Appellant,v.WAYNE COUNTY BOARD OF AUDITORS, Wayne County Civil ServiceCommission, County of Wayne, and Wayne CountyBoard of Commissioners, Defendants-Appellees.
No. 83-1378.
United States Court of Appeals,Sixth Circuit.
Argued Aug. 29, 1984.Decided Dec. 6, 1984.
Eleanor Cattron Smith, argued, Detroit, Mich., for plaintiff-appellant.
W.B. McIntyre, Jr., Bob Anderson, argued, Detroit, Mich., for defendants-appellees.
Before LIVELY, Chief Judge, WELLFORD, Circuit Judge, and GIBBONS, District Judge.*
LIVELY, Chief Judge.
1
This is an appeal by the plaintiff who is dissatisfied with the relief granted to him by the district court. The district court referred plaintiff's employment discrimination claim to a master who found that the defendant, Wayne County Board of Auditors, a state agency, discriminated against plaintiff in violation of Title VII of the Civil Rights Act of 1964 (the Act) by retaliating against him for filing a claim of discrimination with the Equal Employment Opportunity Commission (EEOC). However, the master also held that the plaintiff did not prove racial or age discrimination and that the plaintiff failed to establish a prima facie case for recovery of monetary damages under 42 U.S.C. Sec. 1981 or Sec. 1983. The district court affirmed these holdings. The important question presented by this appeal is whether, upon finding a violation of Title VII, the district court erred in holding the plaintiff failed to establish a prima facie case of violation of Sec. 1983.
I.
2
The plaintiff, a white male, was hired by the Wayne County Board of Auditors in 1970. Over the next eight years the plaintiff sought and was denied several promotions and was twice demoted. On these occasions he filed charges with various state agencies and the EEOC which were largely unproductive. In 1978, after the plaintiff objected to the reclassification of another employee, the defendant demoted him. The plaintiff then filed yet another complaint with the EEOC which led to the present action. After receiving a right to sue letter the plaintiff filed suit in the district court charging violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e, et seq. (1976), and the Civil Rights Acts of 1870 and 1871, 42 U.S.C. Secs. 1981 and 1983 (1976). In his complaint the plaintiff sought a declaratory judgment and injunctive relief as well as compensatory and punitive damages and reinstatement to the position he held before his most recent demotion.
3
Upon determining that the case had not been scheduled for trial within 120 days after the issues were joined, the district judge referred the matter to a magistrate "as Master pursuant to Rule 53 ...." The order of reference was made "[o]n the authority of 42 U.S.C. Sec. 2000e-5(f)(5)" which provides:
4
It shall be the duty of the judge designated pursuant to this subsection to assign the case for hearing at the earliest practicable date and to cause the case to be in every way expedited. If such judge has not scheduled the case for trial within one hundred and twenty days after issue has been joined, that judge may appoint a master pursuant to rule 53 of the Federal Rules of Civil Procedure.
5
The magistrate conducted a trial and issued his "Master's Report and Recommendations" in which he found that the plaintiff's employer had demoted him in retaliation for filing discrimination charges. Such retaliation is specifically prohibited by Sec. 704 of the Act, 42 U.S.C. Sec. 2000e-3(a). The master found, however, that the plaintiff had failed to establish discrimination on the basis of age or race. In his report the master recommended an award of back pay and compensatory damages to the plaintiff for violation of Title VII and an injunction requiring the defendants to permit Day to sit for future competitive or promotional examinations. The master found that the plaintiff had not proven a violation of Sec. 1981 or Sec. 1983 and denied punitive damages as relief sought only in connection with the Sec. 1981 claim.
6
The plaintiff filed objections to the master's report and the district court held a hearing. Thereafter the district judge filed a memorandum opinion in which he agreed with the master's findings with respect to violations, but ordered different relief. The district court allowed back pay representing the difference between the plaintiff's actual earnings and the amount he would have earned except for the defendants' discrimination by retaliation. The district court also awarded "front pay" by requiring the defendants to pay the plaintiff at the rate of the position from which he was demoted until his retirement date or until he is promoted to a position which pays an amount equal to or greater than that of the position he held before demotion. The district court denied compensatory and punitive damages, finding that such damages are not permitted for Title VII violations, and accepting the master's conclusion that the plaintiff had failed to establish a violation of Sec. 1981 or Sec. 1983. The district court enjoined the defendants from retaliating against the plaintiff for this litigation and denying him the opportunity to take any examination for promotions "for which he is otherwise entitled to sit." The plaintiff appealed from the district court judgment.
II.
7
The plaintiff's first contention on appeal requires little discussion. In accepting the master's findings of fact, the district court stated that they were not "clearly erroneous." The plaintiff argues that the district court should have reviewed the master's findings under a de novo standard as required by 28 U.S.C. Sec. 636(b)(1), which relates to findings and recommendations of magistrates. The problem with this argument is that Day's case was not referred to the magistrate pursuant to 28 U.S.C. Sec. 636. The order of reference was made "[o]n the authority of 42 U.S.C. Sec. 2000e-5(f)(5)" and stated that the magistrate was appointed "as Master pursuant to Rule 53 of the Federal Rules of Civil Procedure ...." Rule 53(e)(2) provides, "In an action to be tried without a jury the court shall accept the master's findings of fact unless clearly erroneous." The plaintiff did not object to the order of reference and recognized throughout the proceedings that the magistrate was appointed as, and was acting as, a master in this case. The district court correctly reviewed the findings of fact under the clearly erroneous standard. None of the arguments of the plaintiff on this issue recognizes the fact that the district judge followed the procedures of Sec. 2000e-5(f)(5) with exactitude and reviewed the master's findings in precisely the manner provided for when an order of reference is made pursuant to that provision of Title VII.1
III.
8
The district court accepted, without discussion, the master's holding that the plaintiff failed to make a prima facie case for relief under 42 U.S.C. Sec. 1981 or Sec. 1983. In arguing her objections to the master's report before the district court, counsel for the plaintiff stated: "We have not waived our right to damages under 1983 and it's my understanding of the law that the Master was correct in finding since it is a state agency there would be no liability under 1981 which is probably why he didn't find liability under 1983." Later in her presentation, counsel argued, "[I]f we prevail under Title VII we can see no reason why there should not also be liability under 42 U.S.C. 1983." From these statements and from the arguments in appellant's brief in this court we conclude that plaintiff abandoned his Sec. 1981 claim. However, the plaintiff continues to contend that he was entitled to monetary damages under Sec. 1983.
A.
9
Two elements are required for a prima facie case under Sec. 1983: There must be conduct by someone acting under color of state law and this conduct must deprive the plaintiff of rights secured by the Constitution or laws of the United States. Parratt v. Taylor, 451 U.S. 527, 535, 101 S.Ct. 1908, 1912, 68 L.Ed.2d 420 (1981). Section 1983 is a remedial statute which does not create substantive rights. Chapman v. Houston Welfare Rights Organization, 441 U.S. 600, 616-18, 99 S.Ct. 1905, 1915-16, 60 L.Ed.2d 508 (1979). It provides a remedy for the violation of rights created elsewhere. As the Supreme Court made clear in Maine v. Thiboutot, 448 U.S. 1, 100 S.Ct. 2502, 65 L.Ed.2d 555 (1980), Sec. 1983 provides a remedy for actions under color of law which contravene federally protected rights, whether those rights derive from the Constitution or from a federal statute.
10
It is not denied that the defendants in this case acted under color of state law. Nor do the defendants question the finding that they violated Title VII, a federal statute, by retaliating against the plaintiff for his complaints and protests concerning their employment practices. Thus, the two elements required for a prima facie case under Sec. 1983 appear to have been satisfied. This leads to the inquiry whether there is something about the relationship between Title VII and Sec. 1983 which requires a different conclusion.
B.
11
Where a statute provides a particular procedure and an exclusive remedy for violations, Sec. 1983 may not be used to obtain additional remedies. Preiser v. Rodriguez, 411 U.S. 475, 93 S.Ct. 1827, 36 L.Ed.2d 439 (1973). However, the fact that a statute contains a comprehensive remedial scheme does not necessarily rule out the availability of all additional remedies under Sec. 1983. In Smith v. Robinson, --- U.S. ----, 104 S.Ct. 3457, 82 L.Ed.2d 746 (1984), the Supreme Court held that the Education of the Handicapped Act, 20 U.S.C. Sec. 1400 et seq. (EHA), precluded the assertion under Sec. 1983 of equal protection claims virtually identical to EHA claims, but did not rule out the assertion of independent due process claims. The Court observed that it will not lightly determine that Congress intended to preclude reliance on Sec. 1983 for substantial federal claims, but that Congress does have the authority to repeal Sec. 1983 or replace it with respect to particular rights by providing an exclusive remedy elsewhere. "The crucial consideration is what Congress intended." 104 S.Ct. at 3469-70 (citations omitted). Our task, then, is to determine whether Congress intended to permit resort to Sec. 1983 for violations of Title VII when it adopted the 1972 amendments which made that statute applicable to discrimination in public employment.
IV.
A.
12
When originally enacted in 1964, Title VII applied only to private employment. In cases where an employee sought relief under Title VII and Sec. 1981 the Supreme Court has interpreted Title VII as providing a non-exclusive remedy for discrimination by private employers. In Alexander v. Gardner-Denver Co., 415 U.S. 36, 48-49, 94 S.Ct. 1011, 1019-1020, 39 L.Ed.2d 147 (1974), the Supreme Court stated:
13
[T]he legislative history of Title VII manifests a congressional intent to allow an individual to pursue independently his rights under both Title VII and other applicable state and federal statutes. The clear inference is that Title VII was designed to supplement, rather than supplant, existing laws and institutions relating to employment discrimination.
14
In Johnson v. Railway Express Agency, 421 U.S. 454, 459, 95 S.Ct. 1716, 1719, 44 L.Ed.2d 295 (1975), the Court wrote:
15
Despite Title VII's range and its design as a comprehensive solution for the problem of invidious discrimination in employment the aggrieved individual clearly is not deprived of other remedies he possesses and is not limited to Title VII in his search for relief.
16
The Court noted legislative history which stated specifically that Title VII and Sec. 1981, which derives from the Civil Rights Act of 1870, "augment each other and are not mutually exclusive." Id., quoting H.R. Rep. No. 92-238, p. 19 (1971).
17
The Supreme Court reached a different conclusion with respect to 42 U.S.C. Sec. 1985(3) (1976), the surviving portions of Sec. 2 of the Civil Rights Act of 1871. In Great American Federal Savings & Loan Ass'n v. Novotny, 442 U.S. 366, 99 S.Ct. 2345, 60 L.Ed.2d 957 (1979), a discharged employee of a private employer claimed that he was fired in retaliation for supporting female employees who complained of disparate treatment. He sought damages under Sec. 1985(3). After reviewing the comprehensive structure and scope of Title VII the Court concluded:
18
If a violation of Title VII could be asserted through Sec. 1985(3), a complainant could avoid most if not all of these detailed and specific provisions of the law. Section 1985(3) expressly authorizes compensatory damages; punitive damages might well follow. The plaintiff or defendant might demand a jury trial. The short and precise time limitations of Title VII would be grossly altered. Perhaps most importantly, the complainant could completely bypass the administrative process, which plays such a crucial role in the scheme established by Congress in Title VII.
19
Id. at 375-76, 99 S.Ct. at 2350-51 (footnote omitted).
B.
20
The Supreme Court has not decided whether a plaintiff who claims discrimination in employment practices by a state official or state agency may bring an action under both Title VII and Sec. 1983. However, the 1972 amendment to Title VII which forbade discrimination in employment by the federal government as well as by state and local employers was discussed in Brown v. General Services Administration, 425 U.S. 820, 96 S.Ct. 1961, 48 L.Ed.2d 402 (1976). There the Supreme Court concluded that in the 1972 enactment of Sec. 717 which deals only with federal employees, Congress intended "to create an exclusive, pre-emptive administrative and judicial scheme for the redress of federal employment discrimination." Id. at 829, 96 S.Ct. at 1966. The Court found that employment discrimination by the federal government clearly violated the Constitution and a statute before adoption of the 1972 amendment, but that the remedies were ineffective. Relying on the established rule that a precisely drawn, detailed statute preempts a more general one, the Court held that a federal employee claiming job discrimination may proceed only under Title VII, and may not secure additional remedies by proceeding also under Sec. 1981.
21
The Court in Brown recognized that a different conclusion had been reached in Johnson v. Railway Express Agency, but found that decision "inapposite." Id. at 833, 96 S.Ct. at 1968. Johnson was distinguished as applying to private rather than public employment and as having rested upon explicit legislative history of the 1964 Act which made it clear that the provisions of Title VII and Sec. 1981 are not mutually exclusive. The legislative history of the 1972 amendments was found to lead to the opposite conclusion with respect to Sec. 717.
V.
22
Though the issue is not without doubt, we believe Title VII provides the exclusive remedy when the only Sec. 1983 cause of action is based on a violation of Title VII. Like Sec. 1985(3), Sec. 1983 creates no substantive rights; it only provides a remedy. It would be anomalous to hold that when the only unlawful employment practice consists of the violation of a right created by Title VII, the plaintiff can by-pass all of the administrative processes of Title VII and go directly into court under Sec. 1983. Thus, we believe the reasoning of Novotny applies. The Supreme Court's conclusions in Brown v. GSA are also persuasive. Both federal employees and state and local employees were brought within the protection of Title VII by the 1972 amendments. In Brown, the Court found Johnson v. Railway Express Agency "inapposite" because that case dealt with private as opposed to public employment. It can easily be inferred that Congress intended, by bringing public employment under the Title VII umbrella, to make the comprehensive provisions of that statute the exclusive remedy for violations of its terms. As the Supreme Court stated in Middlesex County Sewerage Authority v. National Sea Clammers Association, 453 U.S. 1, 15, 101 S.Ct. 2615, 2623, 69 L.Ed.2d 435 (1981), after noting the comprehensive nature of a pair of federal statutes, "in the absence of strong indicia of a contrary congressional intent, we are compelled to conclude that Congress provided precisely the remedies it considered appropriate."
23
The legislative history of the 1972 amendments does not indicate a contrary congressional intent. The House Report on the 1972 amendments states:
24
In establishing the applicability of Title VII to State and local employees, the Committee wishes to emphasize that the individual's right to file a civil action in his own behalf, pursuant to the Civil Rights Act of 1870 and 1871, 42 U.S.C. Secs. 1981 and 1983, is in no way affected.... Title VII was envisioned as an independent statutory authority meant to provide an aggrieved individual with an additional remedy to redress employment discrimination.... The bill, therefore, by extending jurisdiction to State and local government employees does not affect existing rights that such individuals have already been granted by previous legislation.
25
H.R. Rep. No. 92-238, reprinted in 1972 U.S. Code Cong. & Adm. News 2137, 2154 (emphasis added). We believed the committee referred to the right to sue under Sec. 1983 for constitutional violations or for violation of statutes which protected such employees before the enactment of the 1972 amendments. Claims under these existing laws were not affected; they could be pursued along with claims under Title VII for the purpose of obtaining additional remedies. However, we do not read this language as expressing an intent that where employer conduct violates only Title VII, which created new rights and remedies for public employees, an aggrieved employee may sue under both Title VII and Sec. 1983.
26
This court has previously held that an employee may sue her public employer under both Title VII and Sec. 1983 when the Sec. 1983 violation rests on a claim of infringement of rights guaranteed by the Constitution. Grano v. Department of Development, City of Columbus, 637 F.2d 1073 (6th Cir.1980). That decision is not affected by the present one. Where an employee establishes employer conduct which violates both Title VII and rights derived from another source--the Constitution or a federal statute--which existed at the time of the enactment of Title VII, the claim based on the other source is independent of the Title VII claim, and the plaintiff may seek the remedies provided by Sec. 1983 in addition to those created by Title VII. Here the district court found that the defendants did not discriminate against the plaintiff. The only wrongful act was their retaliation for the plaintiff's actions, a violation of Title VII. We conclude that Congress did not intend this violation to be the basis of a Sec. 1983 claim.
VI.
27
The plaintiff also argues that the attorney fees awarded by the district court were inadequate. Since the motion for allowance of fees was not made until after the notice of appeal had been filed, the issue of attorney fees is not before this court. The mere filing of a supplemental appendix did not bring to this court for review an order of the district court which was not included (and could not have been included) in the designation of "the judgment, order or part thereof appealed from" in the notice of appeal. Rule 3(c), Federal Rules of Appellate Procedure.
CONCLUSION
28
The district court did not abuse its discretion in fashioning a remedy for the violation of Title VII. Nor did it commit error in dismissing the plaintiff's Sec. 1983 action when the only unlawful act proven by the plaintiff was violation of the provision of Title VII which makes it illegal for an employer to retaliate for an employee's charges of discrimination.
29
The judgment of the district court is affirmed.
*
The Honorable Julia S. Gibbons, Judge, United States District Court for the Western District of Tennessee, sitting by designation
1
Hill v. Duriron Company, Inc., 656 F.2d 1208 (6th Cir.1981), involved an order of reference to a magistrate, as a magistrate, not as a master. The order of reference did not mention 42 U.S.C. Sec. 2000e-5(f)(5). Under these circumstances we held the plaintiffs were entitled to de novo review. Hill provides no support to the plaintiff in this case
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In the United States Court of Federal Claims
OFFICE OF SPECIAL MASTERS
Filed: November 7, 2019
* * * * * * * * * * * * *
JOHN SQUADRONI, * Unpublished
*
Petitioner, * No. 16-1102V
*
v. * Special Master Gowen
*
SECRETARY OF HEALTH * Decision on Entitlement;
AND HUMAN SERVICES, * Ruling on the Record; Tetanus-
* Diphtheria-Pertussis (“Tdap”);
* Insufficient Proof of Causation.
Respondent. *
* * * * * * * * * * * * *
Howard S. Gold, Gold Law Firm, LLC, Wellesley Hills, MA, for petitioner.
Darryl R. Wishard, United States Department of Justice, Washington, DC, for respondent.
ENTITLEMENT DECISION1
On September 2, 2016, John Squadroni (“petitioner”) filed a claim pursuant to the
National Vaccine Injury Program.2 Petitioner alleged he suffered from “back pain, lumbar pain,
shoulder pain and sacral pain” as a result of receiving the Tetanus-diphtheria-pertussis (“Tdap”)
vaccination on March 14, 2014. Petition at ¶1 (ECF No. 1). On August 8, 2018, petitioner filed
a motion for a ruling on the record. Petitioner’s (“Pet.”) Motion (“Mot.”) (ECF No. 40).
Respondent filed a response on August 21, 2018. Respondent’s (“Resp.”) Response (ECF No.
41). Petitioner filed a reply on August 27, 2018. Pet. Reply (ECF No. 42). After a full review
of the entire record described below, I hereby DENY petitioner’s motion for a ruling resolving
entitlement in his favor. I hereby find that the petitioner has not established that the Tdap
1
Pursuant to the E-Government Act of 2002, see 44 U.S.C. § 3501 note (2012), because this decision contains a
reasoned explanation for the action in this case, I am required to post it on the website of the United States Court of
Federal Claims. The court’s website is at http://www.uscfc.uscourts.gov/aggregator/sources/7. This means the
Ruling will be available to anyone with access to the Internet. Before the decision is posted on the court’s
website, each party has 14 days to file a motion requesting redaction “of any information furnished by that party:
(1) that is a trade secret or commercial or financial in substance and is privileged or confidential; or (2) that
includes medical files or similar files, the disclosure of which would constitute a clearly unwarranted invasion of
privacy.” Vaccine Rule 18(b). “An objecting party must provide the court with a proposed redacted version of the
decision.” Id. If neither party files a motion for redaction within 14 days, the decision will be posted on the
court’s website without any changes. Id.
2
The Program comprises Part 2 of the National Childhood Vaccine Injury Act of 1986, 42 U.S.C. §§ 300aa-10 et
seq. (hereinafter “Vaccine Act” or “the Act”). Hereafter, individual section references will be to 42 U.S.C. § 300aa
of the Act.
vaccination caused the onset of his back and shoulder pain. Moreover, petitioner has not
submitted preponderant evidence establishing a vaccine-related injury as required by the Act.
Therefore, petitioner is not entitled to compensation and his claim must be dismissed.3
I. Legal Standard
A petitioner must prove that he is entitled to compensation under the Vaccine Program.
The petitioner’s burden of proof is by a preponderance of the evidence. § 300aa-13(a)(1). A
petitioner may demonstrate entitlement in one of two ways. The first way is to show that he
suffered an injury listed on the Vaccine Injury table (a “Table” injury) with the requisite
vaccination, injury, and time frame as elucidated by the Qualifications and Aids to Interpretation
in which case causation is presumed. 42 U.S.C. § 100.3.
In this case, petitioner does not allege a Table injury. Therefore, petitioner has the
burden of demonstrating causation-in-fact by a preponderance of the evidence. See Cedillo v.
Sec’y of Health & Human Servs., 592 F.3d 1315, 1321 (Fed. Cir. 2010); § 300aa-13(a)(1). To
show causation-in-fact, petitioner must provide: “(1) a medical theory causally connecting the
vaccination and the injury; (2) a logical sequence of cause and effect showing that the
vaccination was the reason for the injury; and (3) a showing of a proximate temporal relationship
between the vaccination and injury.” Althen v. Sec’y of Health & Human Servs., 418 F.3d 1274,
1278 (Fed. Cir. 2005).
Petitioner must demonstrate that it was “more likely than not” that the vaccination in
question caused his injury in order to meet the preponderance of the evidence standard. Moberly
v. Sec’y of Health & Human Servs., 592 F.3d 1315, 1322 n.2 (Fed. Cir. 2010). Petitioner does not
need to show proof to a medical certainty. Bunting v. Sec’y of Health & Human Servs., 931 F.2d
867, 873 (Fed. Cir. 1991). Petitioner must demonstrate that the vaccination in question was “not
only [a] but for cause of the injury but also a substantial factor in bringing about the injury.”
Moberly, 592 F.3d at 1321 (quoting Shyface v. Sec’y of Health & Human Servs., 165 F.3d 1344,
1352-53 (Fed. Cir. 1999)); Pafford v. Sec’y of Health & Human Servs., 451 F.3d 1352, 1355 (Fed.
Cir. 2006).
The Vaccine Act requires a special master to consider the record as a whole. The Vaccine
Act prohibits a special master from ruling in petitioners’ favor solely based on his own allegation
“unsubstantiated by medical records or medical opinion.” § 13(a)(1).
The process of making determinations in Vaccine Program cases for factual issues begins
with consideration of the medical records which are required to be filed with the petition. §
11(c)(2). A petitioner’s medical records “warrant consideration as trustworthy evidence.”
Cucuras v. Sec’y of Health & Human Servs., 993 F.2s 1525, 1528 (Fed. Cir. 1993). Medical
records that are created contemporaneously with the events they describe are presumed to be
accurate and complete. Cucuras, 993 F.2d at 1528. This presumption of accuracy and
completeness is based on the linked propositions that (1) sick people visit medical professionals;
(2) sick people honestly report their health problems to those professionals; and (3) medical
3
Pursuant to § 300aa-13(a)(1), in order to reach my decision, I have considered the entire record including all of the
medical records, statements, expert reports, and medical literature submitted by the parties. This decision discusses
the elements of the record I found most relevant to the outcome.
2
professionals record what they are told or observe when examining their patients in as accurate a
manner as possible, so that they are aware of enough relevant facts to make appropriate treatment
decisions. Cucuras, 993 F.2d at 1525. If the medical records are clear, consistent, and complete,
then they are afforded substantial weight. Lowrie v. Sec’y of Health & Human Servs., No. 03-
1585V, 2005 WL 6117475, at *20 (Fed. Cl. Spec. Mstr. Dec. 12, 2005).
A diagnosis and an opinion from a treating physician may be considered in the evaluation
of a case. Capizzano v. Sec’y of Health & Human Servs., 440 F. 3d 1317, 1326 (Fed. Cir. 2006).
If contemporaneous physician’s notes are “all speculative,” a Special Master is permitted to find
that such evidence is not dispositive. See Moberly ex. rel. Moberly v. Sec’y of Health & Human
Servs., 592 F. 3d at 1323-25 (finding that speculative notations by treating physicians were
properly not dispositive on causation because “[while] several of petitioner’s treating physicians
noted the temporal relationship between [petitioner’s] vaccination and petitioner’s initial brief
seizures, none ever offered a solid statement…that the vaccination caused petitioner’s condition).”
Special masters should consider all of the above possibilities when evaluating the factual
evidence as part of his or her responsibility to “consider all relevant and reliable evidence in the
record.” La Londe, 110 Fed.Cl. at 204.
Petitioners often need to present a report from medical experts in support of their claim to
establish a sound and reliable medical theory. Lampe v. Sec’y of Health & Human Servs., 219
F.3d 1357, 1361 (Fed. Cir. 2000). In Vaccine Act cases, expert testimony is evaluated according
to the factors for analyzing scientific reliability set forth in Daubert v. Merrell Dow Pharm., Inc.,
509 U.S. 579, 594-96 (1993); see also Cedillo, 617 F.3d 1328, 1339 (Fed. Cir. 2010) (citing Terran
v. Sec’y of Health & Human Servs., 195 F.3d 1302, 1316 (Fed. Cir. 1999)). “The Daubert factors
for analyzing the reliability of testimony are: (1) whether a theory or technique can be (and has
been) tested; (2) whether the theory or technique has been subjected to peer review and publication;
(3) whether there is a known or potential rate of error and whether there are standards for
controlling the error; and (4) whether the theory or technique enjoys general acceptance within a
relevant scientific community.” Terran, 195 F.3d at 1316 n.2 (citing Daubert, 509 U.S. at 592-
95).
In Vaccine Program cases, the Daubert factors are used to weigh the proffered scientific
evidence to determine their reliability. Davis v. Sec’y of Health & Human Servs., 94 Fed. Cl. 53,
66-67 (2010) (“uniquely in this Circuit, the Daubert factors have been employed also as an
acceptable evidentiary-gauging tool with respect to persuasiveness of expert testimony already
admitted”), aff’d, 420 F. App’x 923 (Fed. Cir. 2011). The flexible use of the Daubert factors to
evaluate the persuasiveness and/or reliability of expert testimony in the Vaccine Program has been
routinely upheld. See, e.g., Snyder v. Sec’y of Health & Human Servs., 88 Fed. Cl. 706, 742-45
(2009).
A special master’s decision may be “based on the credibility of the experts and the relative
persuasiveness of their competing theories” when both sides offer expert testimony. Broekelschen
v. Sec’y of Health & Human Servs., 618 F.3d 1339, 1347 (Fed. Cir. 2010) (citing Lampe v. Sec’y
of Health & Human Servs., 219 F.3d 1357, 1362 9Fed. Cir. 2000)). However, nothing requires
the acceptance of an expert’s conclusion “connected to existing data only by the ipse dixit of the
expert,” especially if “there is simply too great an analytical gap between the data and opinion
3
proffered.” Snyder, 88 Fed. Cl. at 743 (quoting Gen. Elec. Co. v. Joiner, 522 U.S. 146 (1997)).
II. Procedural History
Petitioner filed his claim in the Vaccine Program on September 2, 2016. Petition (ECF
No. 1). Petitioner alleged that he received the Adacel Tdap vaccination on March 14, 2014 and
subsequently suffered from back, lumbar, shoulder, and sacral pain as a result. Petition at ¶1.
This case was assigned to my docket on September 6, 2016. (ECF No. 3). Petitioner filed his
medical records on September 22, 2016. Pet. Exs. 1-6 (ECF No. 6).
On November 1, 2016, respondent filed his Rule 4(c) Report recommending against
compensation. Resp. Report at 1 (ECF No. 7). Respondent objected to compensation for two
reasons. First, respondent argued petitioner has a bilateral subdeltoid bursitis of unknown cause
which does not meet the requirements of a Shoulder Injury Related to Vaccine Administration
(“SIRVA”). Resp. Report at 7. Second, respondent argued the Tdap vaccine did not cause or
significantly aggravate petitioner’s pre-vaccination conditions of low back pain, joint
arthropathy, and lumbar stenosis. Id.
On November 9, 2016, I ordered both parties to file expert reports addressing the issue of
vaccine causation. See Scheduling Order (ECF No. 8). Petitioner filed an expert report from Dr.
M. Eric Gershwin on April 25, 2017. Pet. Ex. 7 (ECF No. 15). Respondent filed a responsive
report from Dr. Chester Oddis on July 10, 2017. Resp. Ex. A (ECF No. 23).
I held a Rule 5 status conference on September 20, 2017. During the status conference, I
noted that petitioner is proposing a vaccine causation theory whereby his “complicated emotional
state predisposed him to have a more extreme reaction to the vaccine.” Scheduling Order at 1
(ECF No. 24). I stated that there is a lack of a clear connection between the vaccine and
petitioner’s alleged injury. Id. As a result, I ordered petitioner to file psychiatric records, an
evaluation explaining his severe somatic response to the vaccination, and a supplemental expert
report addressing petitioner’s psychiatric reaction to vaccination and the physiological process of
pain moving from petitioner’s arms to other regions of his body. Id. at 2.
Petitioner requested four extensions of time to secure an additional expert report. (ECF
Nos. 25, 27, 29, 31). Following the fourth motion for an extension of time on April 21, 2018,
respondent filed a motion objecting to an additional extension of time and moved for summary
judgment. (ECF No. 32). On April 23, 2018, I granted petitioner’s motion for an extension of
time and deferred ruling on respondent’s motion for summary judgment. See Order (ECF No.
33).
Petitioner filed a self-reported pain calendar documenting his alleged condition on May
11, 2018. Pet. Ex. 8 (ECF No. 34). On the same day, petitioner filed an expert report from Dr.
Raymond Singer, PhD, a neuropsychologist, addressing causation. Pet. Ex. 9 (ECF No. 35). He
opined that the petitioner was in good health prior to the vaccine, not acknowledging any of his
prior musculoskeletal complaints, that there was a temporal relationship between the vaccine and
onset of symptoms and diagnosed a psychosomatic disorder for which a full neuropsychological
evaluation should be done. Pet. Ex. 9 at 9. This examination was never completed.
4
I held a status conference on May 31, 2018. During the status conference, I noted Dr.
Singer appeared to make his diagnosis based on petitioner’s medical records rather than a direct
evaluation even though he was rendering a psychological diagnosis. Scheduling Order at 1 (ECF
No. 37). Second, I noted the petitioner’s pain diary did not indicate if it was created at the time
petitioner was experiencing the pain. Id. Third, I stated that there may not be a sufficiently
strong logical nexus between vaccination and petitioner’s alleged injury such that a
psychological symptom amplification syndrome can be considered a vaccine injury. Id. at 2.
Petitioner contended his injury was back and shoulder pain that he experienced after the
vaccination and not that the vaccine caused his psychological condition. I ordered petitioner to
file an affidavit detailing how and when the filed pain calendar was created. Id. During the
status conference, the parties agreed to a ruling on the record and I ordered petitioner to file the
appropriate motion. Id. I also denied respondent’s earlier motion for summary judgment as
moot. Id.
On June 14, 2018, petitioner filed an affidavit stating he created the pain diary
contemporaneously. (ECF No. 38). On July 16, 2018, petitioner filed a motion to amend the
schedule for filing a motion for a ruling on the record. (ECF No. 39). Petitioner requested to
have until August 9, 2018 to file the motion. (ECF No. 39). Petitioner’s motion was granted on
July 17, 2018. Order Non-PDF, Granting Motion to Amend Schedule.
On August 8, 2018, petitioner filed a motion for a ruling on the record. Pet. Mot.
Respondent filed a response to the motion on August 21, 2018. Resp. Response. Petitioner filed
a reply on August 27, 2018. Pet. Reply (ECF No. 42).
This motion is now ripe for adjudication.
III. Relevant Medical Facts
A. Petitioner’s Medical Records Prior to Vaccination
Petitioner has a significant medical history of multiple chronic conditions including
hyperlipidemia, hypertension, osteoarthritis, diabetes, and ulnar nerve neuropathy. Pet. Ex. 4 at 5-
6. Petitioner had previously undergone neck surgery. Id.
The earliest medical record filed is petitioner’s visit with Dr. Anatoliy Fortenko for low
back pain on March 1, 2011. Id. The visit note stated petitioner had an episode of pain in the low
back and buttocks approximately three weeks prior that had since resolved. Id. Dr. Fortenko
diagnosed petitioner’s complaint as lumbosacral radiculopathy4 and facet arthropathy5 and
4
Lumbosacral radiculopathy is disease of the nerve roots in the lower back as a result of inflammation or
impingement by a tumor or bony spur. Dorland’s Illustrated Medical Dictionary 32nd ed. (2012) (hereinafter
“Dorland’s”) at 1571.
5
Facet arthropathy is also known as osteoarthritis that is centered within the facet joints with disk degeneration and
pain that is most common in the lumbar region. Dorland’s at 1344.
5
prescribed meloxicam.6 Id. at 7.
On a March 28, 2011 telephone encounter with Dr. Sherilynn Cooke, petitioner complained
of feeling ill after taking Amlodipine.7 Id. at 24-25. Petitioner stated during the phone call that
the prescribed meloxicam helped with his back and ankle pain. Id. During a subsequent telephone
encounter with Dr. Cooke on June 6, 2011, petitioner complained of continued back pain with
difficulty with urination and tingling/numbness around the cervical area. Id. at 31-32. Dr. Cooke
recommended a follow-up visit with Dr. Fortenko and continuing the meloxicam medication.
Petitioner spoke with Dr. Fortenko by telephone on June 9, 2011. Id. at 38. Petitioner reported
the severe back pain resolved with Aleve but there was still numbness in the left arm which
petitioner attributed to his previous neck surgery. Id.
During an October 18, 2011 telephone encounter with Dr. Cooke, petitioner complained of
occasional hip pain without pain radiating down the leg. Id. at 50-51. Dr. Cooke diagnosed
petitioner’s complaint as low back pain. Id.
Petitioner next saw a physician in-person on November 15, 2011. On November 15, 2011,
petitioner saw Dr. Ekaterina Malinovsky for left buttock and posterior thigh pain that had persisted
intermittently for a year. An MRI of petitioner’s lumbar spine showed “[m]ultilevel spondylotic
disc disease8 and facet joint arthropathy of the lumbar spine.” Pet. Ex. 4 at 61. Dr. Malinvosky
assessed petition with sciatica and stated the pain in petitioner’s buttock and leg could be due to a
muscle spasm rather than osteoarthritis. Id.
On January 29, 2013, petitioner called the Kaiser Permanente call center with a complaint
of severe pain in the right foot. Id. at 130-32. Petitioner stated that the pain was a flare-up of gout
which he attributed to eating crab salad. Id. Petitioner requested a cortisone shot for the pain. Id.
Petitioner saw Dr. Frank Shic on January 30, 2013. Dr. Shic noted great toe pain, assessed gout,
and administered a shot of lidocaine and depomedrol. Id. at 138. Petitioner’s active medical
history at this point matched that from March 1, 2011. Id. at 137.
Petitioner’s next substantive interaction with medical professionals was approximately
nine months later, on September 25, 2013, when he presented to Dr. Shic with lower back pain.
Id. at 190. Petitioner complained of lower back pain and Dr. Shic noted that petitioner endorsed
numbness and tingling after waking up one morning. Id. Dr. Shic noted that petitioner had an
MRI in 2011 that showed spondylotic changes and moderate to severe central stenosis at L4-L5
and L5-S1. Id. Dr. Shic’s physical examination found “exquisite right sided lumbar tenderness”,
assessed him with lower back pain and prescribed meloxicam. Id. at 191. In a telephone encounter
with Dr. Shic, on October 3, 2013 petitioner reported that his lower back pain was better. Id. at
200. Dr. Shic opined that petitioner’s lower back pain was likely due to osteoarthritis rather than
6
Meloxicam is a nonsteroidal anti-inflammatory drug (“NSAID”) that is commonly used to relieve the symptoms of
arthritis. Mayo Clinic, Meloxicam (Oral Route), https://www mayoclinic.org/drugs-supplements/meloxicam-oral-
route/description/drg-20066928, (last accessed July 19, 2019).
7
Amlodipine is a prescription drug used to treat high blood pressure.
8
Degenerative joint disease in the lumbar vertebrae and the vertebral disks that causes pain and stiffness. Dorland’s
at 1754.
6
a strain. Id. at 201.
Petitioner presented to Dr. Shic on March 14, 2014 with complaints of increased right jaw,
shoulder, and arm stiffness following a deer tick bite approximately two weeks prior and bilateral
hand pain. Id. at 262. Petitioner also reported “increased interpersonal stress with neighbor and
female crew team he was coaching.” Id. Dr. Shic’s physical exam showed “exquisite wrist
tenderness.” Id. at 263-64. Dr. Shic assessed petitioner with osteoarthritis of bilateral hands and
injected lidocaine and depomedrol into petitioner’s first MCP9 joints as treatment. Id. During the
visit, petitioner received the Pneumococcal Polysaccharide, 23 Valent (“PPV/23”) and Tdap
vaccinations in question. Id. at 265. The medical assistant’s note stated that petitioner had no
contraindications for the vaccinations. Id. Dr. Shic also assessed petitioner with “stress,” and
referred him to a Behavioral Medicine Specialist (“BMS”). Id. at 265.
B. Petitioner’s Medical Record Post-Vaccination
On March 26, 2014, petitioner called his primary care provider, complaining about “diffuse
muscle cramping after [T]dap shot and remembers having a similar reaction in college that lasted
three weeks.” Pet. Ex. 4 at 270. Dr. Shic noted that this was likely a side effect of the vaccine.
Id.
Petitioner saw Dr. April Young, a psychologist, on March 28, 2014. Id. at 277-78. She
noted that petitioner was referred by Dr. Shic for depression and stress. Id. at 277. Petitioner
reported depression with an onset of 30 years prior. Dr. Young recommended a functional
assessment and further supportive consultation. Id. A second appointment was scheduled for
April 11, 2014. Id.
In an April 9, 2014 telephone encounter with Dr. Shic, petitioner complained of ongoing
muscle aches after Tdap shot. Id. at 286-87. Dr. Shic diagnosed petitioner with myalgia and
ordered a creatine kinase test and complete blood count with differential for petitioner. Id.
Petitioner’s lab results from April 11, 2014 showed high LDLs, high cholesterol, high hemoglobin
A1c, and high blood glucose. Id. at 290-94. Petitioner had a normal creatine kinase and normal
white blood cell differential.10 Id.
Petitioner saw Dr. Young again on April 11, 2014 where he reported pain for “the past
month after receiving his tetanus shot.” Id. at 297. He stated that he is “nearly paralyzed” and
unable to raise his arms, and had difficulty walking. Id. Dr. Young diagnosed petitioner with
depression. Id.
The same day, April 11, 2014, petitioner saw Dr. Shic for muscle cramps and ongoing
“diffuse shoulder and thigh myalgias.” Id. at 301. Petitioner also reported trouble sleeping. Id. A
physical exam revealed deltoid and quadriceps tenderness. Id. Dr. Shic assessed petitioner with
adverse drug reaction, “likely slowly resolving tdap reaction.” Id. at 302. Dr. Shic prescribed
9
The metacarpophalangeal joints (“MCP”) are located between the metacarpal bones and phalanges of the fingers.
10
Petitioner’s creatine kinase value was 28 U/L with a reference range of ≤ 200 U/L, petitioner’s white blood cell
count and count of white blood cell components were all within normal ranges. Pet. Ex. 4 at 293-94.
7
hydrocodone-acetaminophen. Id. Labs were pending to check for rhabomyolysis [sic].11 Id.
Petitioner contacted the Kaiser Permanente call center on April 14, 2014 complaining of
severe pain and pain on his scapula. Id. at 316. Petitioner stated he had stopped taking Vicodin,
but had taken “4 asa”12 which made him feel better four hours later. Id.
Dr. Shic returned petitioner’s call that same day to report the test results. Id. at 306. The
primary diagnosis was diabetes mellitus, type 2. Id. at 306. Petitioner was prescribed an oral tablet
of Metformin13 500 mg and a diabetes monitoring kit. Id. at 307. In a letter to petitioner dated
April 14, 2014, Dr. Shic wrote, “…you have diabetes which could explain some of your recent
symptoms.” Id. at 309.
In a telephone encounter on April 19, 2014 at 8:38 AM, with Dr. Eric Crisostomo,
petitioner reported moderate to severe right arm pain since Tdap vaccination. Id. at 322. Petitioner
stated that the pain may have extended to his other arm and legs. Id. at 322-23. Petitioner reported
pain with overhead arm movements but denied skin redness or swelling. Id. Dr. Crisostomo
commented that petitioner’s symptoms did not sound like an infection due to the lack of
inflammation but questioned if petitioner’s reaction was idiosyncratic. Id.
Later that day, petitioner saw Dr. Prathima Jayaram. Id. at 325-357. Petitioner reported
pain all over his body, especially in his upper body and indicated the pain has continued for one
month. Id. at 326-27. Petitioner reported the pain as 15 out of 10 and described his pain as
“stabbing.” Id. at 326. His range of motion in his bilateral shoulder was “significantly decreased.”
Id. Dr. Jayaram described the physical exam of petitioner’s upper extremities as “abnormal,” and
noted muscle tenderness and restricted range of active motion. Id. at 327. Dr. Jayaram assessed
petitioner with bilateral shoulder joint pain and hip pain with a differential diagnosis of
polymyalgia rheumatica (“PMR”).14 Id. Dr. Jayaram prescribed petitioner 15 mg/per day of
prednisone and referred petitioner to Dr. Sarah Beckman Gratton, a rheumatologist for further
evaluation. Dr. Jayaram ordered tests for a PMR diagnosis which came back negative except for
high ESR and CRP levels.15 Id. at 334-45. Petitioner had normal IgG and IgE levels and a negative
ANA. Id.
On April 21, 2014, petitioner met with Dr. Gratton. Id. at 352. Dr. Gratton noted that
11
Rhabdomyolysis is a disease involving the disintegration or dissolution of muscle and is associated with the
excretion of myoglobin in the urine. Dorland’s at 1637. Petitioner’s medical records do not indicate if these lab
results were reported and do not indicate if petitioner was ever diagnosed with rhabdomyolysis.
12
“ASA” refers to acetylsalicylic acid, the active ingredient of aspirin.
13
Metformin is a drug used to treat high blood sugar levels that are caused by a diabetes mellitus or sugar diabetes
called type 2 diabetes. https://www.mayoclinic.org/drugs-supplements/metformin-oral-route/description/drg-
20067074
14
Polymyalgia rheumatica is a syndrome characterized by joint and muscle pain and a high erythrocyte
sedimentation rate (“ESR”). Dorland’s at 1490.
15
Petitioner’s ESR level was 26 mm/hr with a reference range of 0-20 mm/hr. Petitioners CRP level was 4.4 mg/dL
with a reference range of ≤ 0.5 mg/dL.
8
petitioner was referred to rheumatology because of bilateral shoulder pain and upper arms, along
with corresponding bilateral hip and thigh pain,” and the symptoms got worse after receiving the
Tdap vaccination. Id. Petitioner reported pain in his right shoulder after the Tdap vaccination and
experienced subsequent stiffness in the right shoulder that progressed to the left shoulder. Id. He
stated the pain, “‘feels like a skewer’” from the right to the left arm. Id. at 353. In the
musculoskeletal examination of petitioner, Dr. Gratton found that he had a normal gait, tender
bilateral deltoid, and pain at the anterior hip against resistance. Id. at 356. In an exam of
petitioner’s joints, she found that petitioner had full nontender range of motion, no pain over
elbows, wrists, knees, ankles, mid-feet, or hips (with limited bilateral inner rotation). Id. Dr.
Gratton diagnosed petitioner’s symptoms as being consistent with bilateral deltoid bursitis. Id. at
358-59. Dr. Gratton stated that petitioner has “acute onset of soft tissue pain following vaccination
of the upper extremities and the proximal lower extremities with gradual improvement that he has
associated with Alka-Seltzer (with antihistamine component), raising question of immune system
activation.” Id. at 358. She stated, “Currently the symptoms and exam are consistent with bilateral
deltoid bursitis.” Id. She noted that “this is atypical for PMR in the process (the tenderness diffuse
UE at the start), he is young for this diagnosis and the ESR is very minimally elevated (normal for
age). Id. In her note, Dr. Gratton included an abstract for an article by Soriano, et al. 16 which
connects giant cell arteritis and PMR to the influenza (“flu”) vaccine. Id. at 359-61. She prescribed
him 10 mg/per day of prednisone and recommended he follow his blood-glucose level closely. Id.
at 359. Additionally, Dr. Gratton advised against shoulder injections, but petitioner also deferred
a referral to physical therapy. Id.
On April 23, 2014, petitioner saw his psychiatrist, Dr. Young for a follow-up visit. Dr.
Young documented that petitioner stated he had an “autoimmune reaction to the tetanus shot” and
was able to relate some of his physical pain to his “unresolved/unaddressed emotional issues.” Pet.
Ex. 4 at 371. Petitioner returned to Dr. Young on May 2, 2014 and reported that he stopped taking
medication to determine his pain level. Id. at 375. She noted that petitioner related his physical
difficulties to not being able to participate in the level of elite training he had been previously
engaging in and he described a “clear delineation [in] his well-being prior to and following neck
surgery.” Id. at 375.
On May 11, 2014, Dr. Gratton followed-up with petitioner. Pet. Ex. 4 at 379. She noted
that petitioner began the prednisone, in addition to Alka Seltzer and had improvement. Id.
Petitioner also took his Metformin. Id. He reported that he stopped taking the prednisone, but
pain on his left side returned, although not as severe. Id. He restarted taking prednisone and
reported feeling 80% better. Id. Petitioner also reported that he was able to sleep normally and
his symptoms in his hips resolved. Id. The note from the telephone encounter states that petitioner
was “treated for bursitis (vs. atypical PMR) possibly related to vaccination. If symptoms return
with slow taper of prednisone, will consider more typical treatment of PMR.” Id. Dr. Gratton
prescribed a prednisone taper over a four-week period. Id. at 381.
On May 27, 2014, petitioner called Dr. Gratton and reported issues relating to his
medication. Id. at 387. Petitioner reported that severe pain returned, mostly in his shoulders down
to his arms, when he stopped prednisone completely. Id. Dr. Gratton discussed a shoulder
16
Alex Soriano, et al., Giant Cell Arteritis and Polymyalgia Rheumatica After Influenza Vaccination: Report of 10
Cases and Review of the Literature, 21 Lupus 153 (2012).
9
injection and a faster prednisone taper. Id. Petitioner was referred to radiology for an x-ray of his
shoulders. Id.
On May 29, 2014, petitioner spoke to his primary care physician, Dr. Shic. Id. at 396. Dr.
Shic’s noted that petitioner was being seen by rheumatology and “started on prednisone for
idiosyncratic reaction to tetanus [vaccine].” Id. Dr. Shic diagnosed petitioner with adverse drug
reaction and noted that petitioner was not checking his blood sugars. Id. Dr. Shic ordered a repeat
HGA1c. Id.
On May 30, 2014, petitioner returned to psychologist, Dr. Young. Id. at 400. Petitioner
reported that if it was not for an ankle injury, broken neck (from a pickup basketball game) and
“the injection,” he would be an elite athlete. Id. He informed Dr. Young that he was planning on
going to the northwest to train over the summer to rebuild his muscles that “the injection” caused
to deteriorate. Id. Dr. Young diagnosed petitioner with an “adjustment disorder.” Id. at 399.
Petitioner had x-rays of his shoulders on June 16, 2014. Pet. Ex. at 407. The x-ray
impression was degenerative changes of bilateral acromioclavicular (“AC”) joints with no
evidence of calcific tendinopathy. Id. at 408. However, Dr. Gratton noted that the degenerative
changes in the AC joint are common “wear and tear” changes which do not explain petitioner’s
shoulder pain complaints. Id. at 415. Petitioner had additional labs completed on July 9, 2014
where his ESR and serum CRP were normal.17 Id. at 421.
On July 11, 2014, petitioner had a follow-up exam with Dr. Gratton. Id. at 422. Dr. Gratton
reviewed petitioner’s medical history, where she noted petitioner reported that he “has been in pain
for forty years. He was hit by cars when cycling on seven occasions, had numerous
injuries…broke his neck and ankle.” Id. The reported history again stated that following the Tdap
vaccination in the right shoulder, he experienced stiffness and pain that progressed to his left
shoulder. Id. Petitioner also reported that he had a similar vaccination following Tdap vaccination
in college that lasted for three weeks. Id. Petitioner had mild impingement on resisted shoulder
extension but did not have any pain to palpation or synovitis over elbows or wrists. Id. at 426.
On an August 15, 2014 telephone encounter with Dr. Shic, petitioner reported pain in the
lower sacrum area. Dr. Shic ordered an x-ray which was completed on August 29, 2014. The
sacrum/coccyx x-ray found minimal degenerative spurring of the sacroiliac joints without erosive
change, minimal degenerative endplate changes at the lower lumbar spine, and no definite fracture
or malalignment. Id. at 452. Dr. Shic conducted a physical exam of petitioner on the same day
and in the musculoskeletal exam, Dr. Shic found no lumbosacral tenderness. Id. at 457.
In a September 4, 2014 telephone encounter with Dr. Joseph Reena, petitioner reported
prednisone helped with his aches except for his sacrum pain. Id. at 470. Petitioner reported to Dr.
Gratton in a telephone encounter on September 5, 2014 that Aleve was helpful for his lower back.
Id. at 477. By September 16, 2014, petitioner had stopped taking Aleve and was taking aspirin for
the pain. Id. at 481.
An additional lab test on September 16, 2014 found normal CRP levels, normal ESR levels,
Petitioner’s ESR level was 10 mm/hr with a reference range of 0-20 mm/hr. Petitioner’s CRP level was 0.5
17
mg/dL with a reference range of ≤ 0.5 mg/dL. Pet. Ex. 4 at 421.
10
normal white blood cell levels (including neutrophils, lymphocytes, eosinophils, and basophils).
Id. at 492-94. A September 16, 2014 MRI of the lumbar spine without contrast showed
spondyloarthropathy in the lumbar spine which was most pronounced at the L4-L5 and L5-S1
levels. Id. at 499. The MRI impression stated there was mild interval progression since
petitioner’s previous MRI on February 13, 2011. Id. at 500. The differential diagnosis from the
MRI included post-inflammatory or traumatic changes due to a “subtle area of increased signal on
the T2 fat sat sequence in the right posterior paraspinal musculature.” Id. at 503.
In a September 24, 2014 visit with Dr. Linda Choe, a physiatrist, petitioner reported his
pain was not isolated within the sacral region. Id. at 506. Dr. Choe noted a normal heel and toe
gait with a slight shift to the left in petitioner’s spinal ribs and pelvis. Id. Dr. Choe also noted a
crease in the right lateral rib case and TTP right sacral region. Id. Dr. Choe assessed petitioner
with lumbar spondylosis. Id. at 507.
On October 5, 2014, petitioner saw David Morris, D.C., a chiropractor. Pet. Ex. 5.
Petitioner reported lower back pain, bilateral shoulder pain, buttock and tailbone pain and legs
numbing and tingling. Id. at 1. Dr. Morris found petitioner to have a severe antalgic lean to the
left from his lower back or pelvis as a result of muscle spasms that may have been due to
vaccinations. Pet. Ex. 5 at 4. Petitioner returned to Dr. Morris for six appointments. Id. at 5. A
note from October 22, 2014, states petitioner is “walking more without aggravation-less spasms.”
Id. On October 26, 2014, Dr. Morris noted, “severe deep aching in mid back.” Id. at 5.
On October 14, 2014, petitioner saw Dr. Philip Ranheim. Pet. Ex. 6. Petitioner reported
shoulder and sacrum pain after receiving the Tdap vaccination. Id. at 7. Dr. Ranheim documented
a normal physical exam. Id. at 6. Dr. Ranehim also reviewed petitioner’s medical records and
noted petitioner’s high blood sugars, stating, “Interestingly with the pain his blood sugars went as
high as 280-perhaps this was in conjunction with the prednisone but I’m not sure.” Id. at 5. Dr.
Ranheim assessed petitioner with an “abnormal pain and muscle spasm after vaccine reportedly”
but stated petitioner was doing better after seeing Dr. Morris. Pet. Ex 6 at 4.
Petitioner’s last filed medical record is a February 5, 2016 visit with Dr. Gratton. Id. at
558-59. Petitioner’s symptoms and medical history from the visit are not substantively different
from previous records. Id. at 558-59. The petitioner addresses the intervening interval of time
through his pain diary discussed below.
C. Petition
On September 2, 2016, petitioner filed his petition claiming a March 14, 2014 Tdap
vaccination caused his back pain, lumbar pain, shoulder pain, and sacral pain. Petition at 1.
Petitioner asserts that following the Tdap vaccination, he began to “feel unwell to the point of
unconsciousness.” Petition at ¶ 4. Petitioner asserts he had upper back spasms on the night of
March 16, 2014 which was assessed as a “likely [T]dap side effect” by Dr. Frank Shic on March
26, 2014. Id. at ¶¶ 6-7.
Petitioner asserts complaints of diffuse shoulder and thigh myalgias on April 11, 2014 for
which he was seen on April 21, 2014 by Dr. Sarah Gratton, a rheumatologist. Id. at ¶ 11. Petitioner
underwent prednisone therapy which led to some improvement in petitioner’s condition. Id.
11
Petitioner started to have pain in the sacrum18 area in October 2014. Id. at ¶ 13. Petitioner asserts
that he continues to experience “pain along the right side of the sacrum and the entire right leg.”
Id. at ¶ 14. As a result, petitioner asserts that he has been “unable to work or unable to participate
in his physical activities.” Id. at ¶ 15.
D. Dr. Gershwin’s Expert Report
On April 25, 2017, petitioner filed an expert report from Dr. M. Eric Gershwin.19 Pet. Ex.
7. Dr. Gershwin disagreed with the diagnoses provided by petitioner’s treating physicians. Id. at
2. Dr. Gershwin contended that petitioner’s myalgias that followed the Tdap vaccination was
misdiagnosed by petitioner’s rheumatologist, Dr. Gratton. Id. at 1-2. Dr. Gershwin opined that
the elevated levels of petitioner’s ESR and CRP were consistent with his poorly controlled diabetes
rather than indicative of atypical PMR. Id. Dr. Gershwin asserted that as a result of the PMR
misdiagnosis and incorrect subsequent treatment, petitioner’s problems “became persistent”
instead of resolving. Id.
Dr. Gershwin stated that petitioner had a history of “significant musculoskeletal problems
prior to the vaccine” but that it was “more likely than not that he did develop some myalgias
following [vaccination].” Id. Dr. Gershwin contended, however, that petitioner was
presumptively misdiagnosed with polymyalgia rheumatica when there was no significant evidence
to support that diagnosis. Id. at 2. He stated that petitioner’s elevated inflammatory makers of
ESR and CRP were more consistent with petitioner’s poorly controlled diabetes, but instead he
was misdiagnosed with PMR and treated with steroids. Id. at 2. The waxing and waning dosages
of steroids only made petitioner’s myalgias worse and the suggestion that his myalgias could be
autoimmune made the petitioner’s response “emotional,” and his problems became chronic. Id. at
2. Dr. Gershwin concluded that petitioner was instead suffering from fibromyalgia. Id. at 2. He
stated, “I should note that vaccination does not produce fibromyalgia.” Id. Dr. Gershwin
continued, stating, “It is [petitioner’s] somatic reaction to the events that occurred following the
vaccine that led to his diffuse pain syndrome.” Id. In his review of petitioner’s medical records,
18
The sacrum is the triangular bone below the lumbar vertebrae. The sacrum is directly above the coccyx (tailbone).
Dorland’s Illustrated Medical Dictionary 32nd ed, (2012) (hereinafter “Dorland’s”) at 1662.
19
Dr. Gershwin received his bachelor’s degree summa cum laude from Syracuse University in 1966 and his M.D.
from Stanford University in 1971. Pet. Ex. 7a at 1. Dr. Gershwin received a Master’s Degree in Astronomy and
Astrophysics from the Centre for Astrophysics and Supercomputing in Melbourne, Australia in 2002. Id. Dr.
Gershwin completed his internship and residency at the Tufts-New England Medical Center in Boston, MA in 1973.
Id. at 2. Dr. Gershwin was a Clinical Associate in Immunology and the National Institutes of Health from 1973 to
1975. Id. Since 1975, Dr. Gershwin held academic appointments as Assistant Professor of Medicine in
Rheumatology and Allergy, Professor of Medicine in Rheumatology and Allergy, The Jack and Donald Chia
Professor of Medicine in the Division of Rheumatology/Allergy and Clinical Immunology, and Distinguished
Professor of Medicine in the Division of Rheumatology/Allergy and Clinical Immunology at the University of
California, Davis. Id. at 1-2. Dr. Gershwin is board certified in internal medicine with a subspecialty of
rheumatology and board certified in allergy and clinical immunology. Id. Dr. Gershwin is the Director of the
Allergy-Clinical Immunology Program and Chief of the Division of Rheumatology/Allergy and Clinical
Immunology at the University of California School of Medicine, Davis. Id. Dr. Gershwin is the holder of multiple
patents related to rheumatology and immunology, is an editor on multiple immunology journals, and has extensively
published original research articles and books related to immunology. Id. at 2, 6, 9-123. Dr. Gershwin has served as
an expert witness in multiple Vaccine Program cases.
12
Dr. Gershwin noted that petitioner complained of muscle cramps and diffuse myalgias starting
approximately two weeks after petitioner’s Tdap vaccination on March 14, 2014. Id. at 1. Dr.
Gershwin cited literature concerning fibromyalgia’s relationship with a patient’s stress response
system20 as well as how fibromyalgia’s heightened pain sensitivity can foreshadow chronic pain.21
Although Dr. Gershwin put the label of fibromyalgia on the petitioner’s condition, the focus of his
analysis was on the contribution of psychological stress, victimization and the modulation of pain
information in the development of his pain syndrome.
Dr. Gershwin posits that petitioner became “fixated over a common reaction” following
the Tdap vaccination that was amplified by his treating physicians’ suggestion that his condition
could be PMR, an autoimmune condition. Id. at 2. This fixation then precipitated further somatic
issues. Id. Dr. Gershwin concluded that without the Tdap vaccination, in tandem with the incorrect
treatment of petitioner as a result of a misdiagnosis, petitioner suffered his long-term pain injuries.
Id. Dr. Gershwin stated the “timing of the ‘aches’ following the vaccination was appropriate”
without reference to the medical record or analysis. Id. at 3.
E. Dr. Oddis’ Expert Report
On July 10, 2017, respondent filed a responsive expert report from Dr. Chester Oddis.22
Resp. Ex. A. Dr. Oddis opined that petitioner’s pain pre-dated the Tdap vaccination, stating that,
“[petitioner’s] symptoms are really on a continuum and that they essentially don’t vary
significantly from the first time that he presented to his family doctor in 2011.” Resp. Ex. A at 3.
Dr. Oddis noted that petitioner complained of diffuse musculoskeletal symptoms that included,
back, shoulder, hip and neck pain on several occasions prior to the vaccination. Id. He observed
that the day the petitioner received the vaccination, petitioner was complaining of increased jaw,
shoulder, arm and bilateral hand pain. Id.; see also Pet. Ex. 4 at 263.
Dr. Oddis disagreed with petitioner’s treating rheumatologist on the diagnosis of PMR and
agreed with Dr. Gershwin that petitioner’s symptoms were inconsistent with PMR. Id. at 3. Dr.
Oddis explained that PMR is characterized by significant morning stiffness of the proximal upper
and lower extremity musculature that often lasts several hours and the inflammatory markers are
20
Lesley M. Arnold, The Pathophysiology, Diagnosis and Treatment of Fibromyalgia, 33 Psychiatric Clinics of
North America 375 (June 2010). [Pet. Ex. 7D].
21
Roland Staud, Abnormal Pain Modulation in Patients with Spatially Distributed Chronic Pain: Fibromyalgia, 35
Rheumatic Disease Clinics of North America 263 (May 2009). [Pet. Ex. 7S].
22
Dr. Oddis received his bachelor’s degree in biochemistry from the University of Pittsburgh in 1976 followed by
his M.D. from the Pennsylvania State University College of Medicine in 1980. Resp. Ex. B at 1. Dr. Oddis
completed his internship and residency in internal medicine at the Pennsylvania State University College of
Medicine in 1984 and a fellowship in rheumatology at the University of Pittsburgh School of Medicine in 1987. Id.
Dr. Oddis has held academic positions at the University of Pittsburgh School of Medicine, Division of
Rheumatology and Clinical Immunology since 1987. Id. at 2. Dr. Oddis currently is a Professor of Medicine in the
Division of Rheumatology and Clinical Immunology, the Associate Director of the Rheumatology Fellowship
Training Program, and Director of the Myositis Center at the University of Pittsburgh. Id. Dr. Oddis is board
certified in internal medicine and rheumatology. Dr. Oddis is an active medical researcher and has published
extensively in the field of rheumatology and myositis. Id. at 4-24. Dr. Oddis is an active clinical practitioner at the
University of Pittsburgh. Id. at 25. Dr. Oddis has served as an expert witness in multiple Vaccine Program cases.
13
invariably elevated. Id. Further, the peak age group for PMR are those in their seventies and
eighties. Id. Dr. Oddis stated that petitioner is quite young for the PMR diagnosis; had only a
slightly elevated ESR-and the degree of elevation was not within the range associated with PMR.
Id.
Dr. Oddis disagreed with Dr. Gershwin’s diagnosis of fibromyalgia. Resp. Ex. at 3. Dr.
Oddis observed that petitioner was never diagnosed with fibromyalgia and stated that whether
petitioner actually has fibromyalgia is a moot point. Id. at 4. Dr. Oddis, once again, emphasized
that petitioner’s pain syndrome predated the administration of the Tdap vaccination. Id. He argued
that Dr. Gershwin’s recommendation of counseling ignored the fact that petitioner received
psychological counseling within days of receiving the vaccination and that counseling continued
simultaneously with petitioner’s treatment for pain. Id.; see also Pet. Ex. 4 at 262, 296, 370. Dr.
Oddis stated that petitioner’s treating psychiatrist did not attribute petitioner’s chronic pain or any
exacerbation of pain related to the Tdap vaccination as the cause of petitioner’s depression or
anxiety. Id. at 4.
Dr. Oddis attributed the amplification of petitioner’s pain syndrome to his longstanding
depression, anxiety and significant interpersonal problems. Id. As a result, he argued, the Tdap
vaccine “gave the petitioner another presumptive cause for his chronic pain.” Id. Dr. Oddis
concluded that petitioner’s chronic musculoskeletal complaints and pain syndrome “clearly
predated” the Tdap vaccination. Id.
F. Dr. Singer’s Expert Report
On May 14, 2018, petitioner filed a supplemental expert report from Dr. Raymond
Singer, PhD.23 Pet. Ex. 9. Dr. Singer is a neuropsychologist with experience in forensic matters
involving toxic insult. In this case, Dr. Singer was asked to address two questions I posed in the
Rule 5 Order: 1) Why did petitioner experience such an intense psychiatric reaction to the
vaccination? 2) How do you explain the physiological process of the pain moving from the
arm/shoulder to the lower body and then on to multiple places on the upper and lower body?
See Rule 5 Order at 2. Dr. Singer prefaced his report with various references to the Tdap
package insert and to the presence of aluminum and formaldehyde in the formula without
addressing their role in petitioner’s condition. Pet. Ex. 9 at 2-5. He then focused his report on
23
Dr. Singer is a forensic and clinical neuropsychologist. Pet. Ex. 10 at 2. He received his bachelor’s degree in
psychology in 1972 from the University of Rochester. Id. Dr. Singer then received a master’s degree and a PhD in
psychology from Washington State University in 1975 and 1978, respectively. Id. Dr. Singer received training as a
post-doctoral fellow in environmental epidemiology through the National Institutes of Health, Environmental Health
Sciences from 1979 to 1981 and as a fellow at the Mount Sinai School of Medicine Department of Community
Medicine, Environmental Sciences Laboratory from 1981 to 1982. Id. at 2-3. Dr. Singer was a post-doctoral fellow
in biological psychiatry through the National Institutes of Health at New York University Medical center in 1978.
Id. at 3. Dr. Singer is a fellow in the National Academy of Neuropsychology, American College of Professional
Neuropsychology, American Psychological Association, and Association for Psychological Science. Id. Dr. Singer
has served as a consultant for neuropsychological, neurobehavioral, and neurotoxicological diagnostics and as an
expert witness in toxic chemical litigation since 1983. Id. at 4. Dr. Singer has conducted research and published
extensively in the area of neuropsychology and neurotoxicology. Id. at 7-19.
14
the questions raised in the Rule 5 Order. Id. Dr. Singer provided a summary of psychosomatic
symptoms:
Psychosomatic symptoms [are] a way to describe medically unexplained symptoms,
symptoms of unknown origin, hypochondria and somatoform disorders. Other terms
include somatic symptoms, functional somatic syndromes and deception syndromes. A
simplified view of the condition uses the term “symptom amplification.”
Id. at 5.
Dr. Singer explained that when petitioner first presented to his rheumatologist, Dr.
Gratton, petitioner explained that the pain progressed from his right to his left arm and that “this
type of progression of pain is not typical.” Id. Dr. Singer also observed that the petitioner’s
description of the pain traveling from the shoulder to the buttocks/groin area is “not entirely
consistent with an infectious process which would spread more locally or along nerve patterns.”
Id. at 6. Dr. Singer opined that the petitioner’s local reaction to the Tdap vaccination created a
“cascading series of events, both physical and mental, made worse by petitioner’s psychological
vulnerabilities.” Id. at 8.
Dr. Singer referenced the petitioner’s psychological history from Dr. Young’s progress
note from April 23, 2014, in which she documented that petitioner thought he had a prior reaction
to Tdap in college that caused him to move like a zombie. Id. at 6; see also Pet. Ex. 4 at 371.
Petitioner expressed to Dr. Young that he was “crucified” by the school where he was coaching
and that he could “do miracles,” but was fired and accused of stealing others’ work. Id. Petitioner
also explained that he felt “burned in his work and romantic relationships despite always doing his
best.” Id. Petitioner also discussed “his tendency to shove his emotional pain ‘in the closet’ only
to have it explode and burst open after the experience he had on the ‘reality show of Long Beach.’”
Id.
Dr. Singer reviewed this background, noting that the petitioner had a history of depression
which is commonly associated with psychosomatic illness and is seen as an amplifier of potential
symptoms. Id.at 7. Dr. Singer stated that petitioner’s reference to “moving like a zombie” did
not describe a medical condition and “had the flavor of a psychosomatic movement condition.”
Id. at 7. He observed that petitioner was able to relate some of the physical pain to unresolved and
unaddressed emotional issues, stating, “This is practicably the definition of a psychosomatic
illness, namely conversion disorder.” Id. Dr. Singer related petitioner’s statement that he
“shove[d] his emotional pain in the closet only to have it explode and burst open,” to a
psychosomatic illness, “where buried and suppressed unconscious emotion wreak havoc on bodily
function.” Id. Dr. Singer also observed that the petitioner’s sense of victimization is consistent
with the psychological mechanism thought to underlie psychosomatization. Id. He explained that
that in the petitioner’s statements about how he was accused of stealing others’ work and fired
from his job and how petitioner used the term “crucified” to describe his treatment by the school
where he was coaching are indicative of a sense of victimization. Id. Dr. Singer stated that
victimization is a feeling of frustration that can be put into the body and experienced as pain and
other illnesses. Id. at 8.
Dr. Singer opined, “Prior to the vaccine administration, the claimant was in good
15
health….Absent the [Tdap] shot, [petitioner] would not have suffered the physical and emotional
pain he was experiencing during this time.” Id. at 9. However, when Dr. Singer made his
assessment, he overlooked petitioner’s history of pre-existing musculoskeletal pain complaints,
including those on the day of the vaccination. Additionally, Dr. Singer did not acknowledge that
petitioner was experiencing emotional stress the day he received the vaccine, the same day he was
referred to a mental health specialist.
As for the temporal association to petitioner’s pain and the vaccination, Dr. Singer stated
that “prior to vaccination, the [petitioner] was in good health….The treating physicians opined that
[petitioner] was suffering from a reaction to the tetanus vaccine.” Id. at 8. He concluded that
petitioner’s reaction was made more severe and long-lasting as a result of [petitioner’s] probable
psychosomatic conversion disorder, which amplified the symptoms for this patient.” Id.
G. Petitioner’s Pain Journal
On May 11, 2018, petitioner filed his pain journal as an exhibit. Pet. Ex. 8 (ECF No. 34).
The pain journal begins on March 14, 2014 (the date of vaccination in question) with an entry
stating, “appointment with Dr. Shic. Received barrage of boosters. Went home and within the
hour felt intoxicated and slept hard till late next morning.” Pet. Ex. 8 at 1. Within the pain journal,
discomfort and pain are noted immediately on March 15, 2014 with an entry of “[s]ight [sic] of
injection very sore. Felt very tired. Right shoulder very stiff and painful.” Id.
Over the course of March 2014, petitioner had similar symptoms with increasing levels of
pain. Petitioner documents on March 27, 2014 that the pain was “near paralyzing” and his body
was “hunched and look[ed] twisted.” Id. Throughout 2014, petitioner documented “[d]ifficulty
walking” and the pain is described as located in his right rib cage on April 10, 2014. Id. at 2.
Over the course of the next several months, petitioner documents the level of pain and
location on a daily basis (i.e. “Pain but somewhat tolerable,” “Still sore in shoulders and lower
back,” “General soreness in shoulders to painful upper body,” “Exquisite pain in upper right
buttocks,” etc.) as short entries on a calendar. Pet. Ex. 8 at 1-11. For the time period between
March 14, 2014 and February 11, 2016, petitioner makes detailed entries for specific dates that
document his activity and treatment during the day as well as how he feels. Some of the entries
repeat verbatim for a period of a week to two weeks. Entries from April 10, 2014 through April
23, 2014 is exemplative of this:
“April 11, 2014: Pain in lower right rib cage, otherwise somewhat tolerable. Difficulty
breathing, walking, sleeping.”
Pet. Ex. 8 at 2. This entry was repeated every day for the next two weeks.
Petitioner also submitted an affidavit affirming that the pain calendar was created at the
time the events were occurring and not prepared in anticipation of litigation. Pet. Supp. Affidavit
(ECF No. 38).
H. Petitioner’s Affidavit
On September 22, 2016, petitioner filed an affidavit. Pet. Affidavit (ECF No. 6). He
16
recalled that after receiving the vaccination he “began to feel unwell to the point of
unconsciousness.” Pet. Aff. at ¶ 4. The following day, petitioner felt very sore and exhausted. Id.
Two days later, petitioner stated that his jaw, shoulders and arms went into severe spasms that
woke him up. Id. at ¶ 5. Petitioner stated that it felt “as if I was being skewered through the arm
and shoulders. It felt as if my arms were pinned and my back and shoulders arched backward. It
was difficult to walk and impossible to get any real sleep.” Id. at ¶ 6. Petitioner described the
level of pain as ranging from “the feeling of [my] skin being pierced to the flesh being torn from
the bone,” and it lasted until January 2015. Id. at ¶¶ 8-9. He explained that the most pain he
experienced was along the right side of the sacrum and his entire right leg, affecting his mobility.
Id. at ¶ 16. The petitioner indicated that prior to the vaccination, he was in his “usual health” with
no fever. Id. at ¶ 14. He stated that he continued with physical therapy to strengthen and straighten
his body from the injury. Id. at ¶ 17.
IV. Parties’ Arguments
A. Petitioner’s Motion for Ruling on the Record
Petitioner argued that following vaccination, he felt tired and sore the night of the
vaccination. Pet. Mot. at 6 (citing Pet. Ex. 8 at 1). Over time, petitioner cites to his pain journal
that muscle spasms and pain in the jaw, neck, and shoulders manifested. Pet. Mot. at 7. Petitioner
also cited to the medical record where Dr. Shic and Dr. Gratton make references to petitioner’s
vaccination as a suspected cause as well as the lack of an infection. Id. (citing Pet. Ex. 4 at 302,
322, 359). Petitioner asserted that the vaccine injury in question is the back, shoulder, and regional
pain allegedly caused by the Tdap vaccine. Id. at 11-12.
Petitioner argued he does not have the burden of proving a specific scientific biological
mechanism in order to prevail in his case, citing to Knudsen. Pet. Mot. at 6 (citing Knudsen v.
Sec’y of Health & Human Servs., 35 F.3d 543 (Fed. Cir. 1994). Under prong one of Althen,
petitioner recited the theories offered by Drs. Gershwin and Singer. Id. at 7-10. Under prong two
of Althen, petitioner stated there was no alternate cause and offers the following sequence of
events: (1) petitioner received the Tdap vaccination on March 14, 2014;24 (2) petitioner
experienced shoulder and back pain thereafter; (3) treating physicians stated that the condition was
“likely [a] Tdap side effect;” (3) Drs. Gershwin and Singer opined that the timing of the aches was
appropriate and made worse due to petitioner’s existing medical condition. Pet. Mot. at 10.
Under prong three of Althen, petitioner stated the proximate temporal relationship is met
as petitioner received the vaccination on March 14, 2014 and reported symptoms beginning March
15, 2014. Pet. Mot. at 10-11; see also Pet. Ex. 8 at 1.
Petitioner also responded to Dr. Oddis’ expert report. Petitioner argued that Dr. Oddis
discounted the petitioner’s complaints listed in the post-vaccination medical record and the
notations of treating physicians who state petitioner’s pain was due to vaccination. Pet. Mot. at
13. Petitioner also argued that respondent has not offered evidence in support of alternate
causation. Id. (citing Pafford v. Sec’y of Health & Human Servs., 64 Fed. Cl. 19, 35 (2005), aff’d,
24
Petitioner’s motion mistakenly states he received the “flu vaccine on the morning of March 14, 2014.” Pet. Mot.
at 10. Petitioner received the Tdap and PPV vaccinations on March 14, 2014.
17
451 F.3d 1352 (Fed. Cir. 2006)).
B. Respondent’s Response to Petitioner’s Motion for Ruling on the Record
Following a recitation of the relevant medical facts, respondent first stated that petitioner
has not established that he has suffered a medically-recognized injury by preponderant of the
evidence. Resp. Response at 7; see also Broekelschen, 618 F.3d at 1346; Lombardi v. Sec’y of
Health & Human Servs., 656 F.3d 1343, 1352 (Fed. Cir. 2011). Respondent argued that
petitioner’s pain calendar is insufficient evidence of a vaccine-related injury because it does not
contain any details prior to the vaccine, raising the question of the reliability of the calendar and it
only contains subjective symptoms post-vaccine. Id. at 8. Respondent also stated that petitioner’s
experts, Drs. Gershwin and Singer do not actually identify a vaccine-related injury, rather they
allege petitioner experienced a somatic reaction to the vaccination. Id. Respondent cited to Ruiz,
Reape, Pless, and Bailey where somatic reactions to vaccinations were not found to be
compensable. Id. at 8 (citing Ruiz v. Sec’y of Health & Human Servs., No. 02-156V, 2007 WL
5161612 (Fed. Cl. Spec. Mstr. Mar. 14, 2007); Reape v. Sec’y of Health & Human Servs., No.
151146V, 2017 WL 1246325 (Fed. Cl. Spec. Mstr. Mar. 3, 2017); Pless v. Sec’y of Health &
Human Servs., No. 16-271V, 2017 WL 836610 (Fed. Cl. Spec. Mstr. Feb. 6, 2017); Bailey v. Sec’y
of Health & Human Servs., No. 06-464V, 2008 WL 482359 (Fed. Cl. Spec. Mstr. Feb. 12, 2008)).
Respondent stated that at best, petitioner showed a local reaction to vaccination, but no sequalae
lasted more than six months, his pre-existing medical conditions explain the post-vaccination
reaction, and somatic reactions are not compensable in the Vaccine Program. Id.
Then respondent argued petitioner has failed to meet his burden by preponderant evidence
under the Althen test. Respondent asserted that neither Dr. Gershwin nor Dr. Singer stated a theory
of causation connecting the petitioner’s injury to the Tdap vaccine. Id. at 9. Respondent stated
that Dr. Gershwin opined that petitioner suffered from fibromyalgia, vaccines do not cause
fibromyalgia, and petitioner’s somatic response led to his diffuse pain syndrome. Id. at 6.
Respondent argued that Dr. Singer also does not provide a theory of causation but instead focuses
only on the temporal relationship of the Tdap vaccination to petitioner’s muscle aches. Id. at 10.
Respondent stated that Dr. Singer did not provide any additional evidence as to why the timing of
petitioner’s alleged injury was medically appropriate, and this is insufficient to establish vaccine
causation. Id.
Finally, respondent asserted that none of petitioner’s treating physicians opined that the
Tdap vaccination did cause petitioner a vaccine-related injury. Respondent acknowledged that
some of petitioner’s treating physicians made reference to the Tdap vaccination and petitioner’s
complaints relating back to the vaccination. Id. However, respondent observed that petitioner’s
treating physicians, like Dr. Gratton, stated, “With diffuse nature was not a localized allergy type
reaction. He did not have typical allergy reaction from vaccination. It is difficult to know what
occurred prior.” Id. at 9-10; Pet. Ex. 4 at 559.
C. Petitioner’s Reply
Petitioner filed a reply to Respondent’s Response on August 27, 2018. Pet. Reply (ECF
No. 42). Petitioner first argued that the pain journal is a reliable, sound piece of evidence as the
journal started post-vaccination where petitioner felt far different from his pre-vaccination state.
18
Pet. Reply at 2. Petitioner argued that the pain calendar adds credibility to the complaints he made
to treating physicians. Id.
Next, petitioner argued that the compensable vaccine-related injury was his “back and
shoulder pain” following the vaccine made worse by his “preexisting psychological condition.”
Pet. Reply at 2. Petitioner argued that respondent’s reliance on Ruiz and Pless is misplaced,
arguing that those cases were concerned with the compensability of a psychological injury caused
by vaccination. Petitioner asserted that he is not alleging a psychological injury but rather that the
Tdap vaccination caused a localized response that was made worse by petitioner’s pre-existing
psychological condition. Id.
Finally, petitioner responded to respondent’s criticism of Dr. Singer’s expert report.
Petitioner argues that the majority of expert reports are conducted based on the medical records
without an examination. Id. Additionally, Dr. Singer’s qualifications and background in
neurotoxicology is uniquely suited to evaluate petitioner’s alleged injury. Id. at 4. Finally,
petitioner noted that respondent did not file a responsive report to Dr. Singer’s report. Id.
V. Discussion
A. Onset of Petitioner’s Symptoms
Petitioner alleged that the Tdap vaccination he received on March 14, 2014 caused him to
suffer a reaction diagnosed as “back pain, lumbar pain, shoulder pain, and sacral pain.” Petition
at Preamble. However, the record establishes that these symptoms and other symptoms petitioner
associated with the Tdap vaccine, pre-dated the vaccination.
Two years prior to the vaccination, petitioner had complained of low-back pain to Dr.
Fortenko. Pet. Ex. 4 at 5-6. He continued to complain of lower-back pain from March to
November 2011 in multiple telephone calls to his primary care health provider. Id. at 24-25; 31-
32; 38. He also reported occasional hip pain. Id. at 50-51. An MRI performed on November 15,
2011 revealed multilevel spondylotic disc disease and facet joint arthropathy of the lumbar spine
most severely involving the L4-5 and L5-S1 levels. Id. at 61.
In September 2013, petitioner saw Dr. Shic complaining of lower back without weakness
and numbness or tingling after waking up. Pet. Ex. 4 at 190. Petitioner explained that an MRI in
2011 showed spodylotic changes and moderate to severe central stenosis at the L4-L5 and L5-S1
levels. Id. A physical exam showed petitioner had exquisite right sided lumbar tenderness. Id.
On October 2, 2013, petitioner called his primary care provider complaining of lower back
pain. Pet. Ex. 4 at 197. Dr. Shic spoke to petitioner the following day where petitioner reported
that his pain “has gotten remarkably better since this morning.” Id. at 200. Dr. Shic noted that
petitioner’s low back is “likely due to degenerative joint disease vs. strain,” and encouraged
petitioner to call back if exacerbation of the pain occurred. Id.
On March 14, 2014, the day petitioner received the Tdap vaccination, he had sought
treatment for bilateral shoulder pain, jaw pain, right knee pain and a tick bite that occurred two
weeks prior to the appointment. Id. at 262. Petitioner explained he experienced, “increased right
19
jaw, shoulder and arm stiffness after having been bitten by a deer tick.” Id. Petitioner also
reported, “increased interpersonal stress with neighbor and female crew team he was coaching.”
Id. Two days after the vaccination, an entry in petitioner’s pain journal for March 16, 2014 stated,
“Right shoulder and arm, right knee very stiff and painful. Great deal of pain around jaws and
necks.” Pet. Ex. 8 at 1 (emphasis added). On March 20, 2014, petitioner wrote, “Back arched, left
and right shoulders and arms. Jaw and neck, right leg very painful and extremely stiff.” Id.
On April 19, 2014, petitioner had a follow-up appointment for symptoms “all over his
body, especially in his upper body.” Id. at 325. Petitioner was evaluated by Dr. Jayaram. Id. She
wrote that petitioner presented with pain in the right and left shoulders, pain in the hips to the
thighs, hands feeling swollen and aching, and reduced range of motion of the bilateral shoulders.
Id. at 326. Petitioner reported to Dr. Jayaram that he, “had [a] tick bite when working outdoors in
early March. Got the tick out within minutes. Started to get aching pain in the right arm and jaw
couple of days after the tick bite.” Id. The physical exam was recorded as “abnormal exam of
both upper [extremities],” with “muscle tenderness of the upper arm.” He was diagnosed with
bilateral shoulder joint pain and hip pain. Id. at 327. When petitioner saw his rheumatologist, Dr.
Gratton, on April 21, 2014, petitioner again reported bilateral pain in the shoulders and upper arms
and hips to thighs that “got worse after the [Tdap] injection.” Id. at 353.
The petitioner’s symptoms of right jaw pain, shoulder and arm stiffness that petitioner
asserts began after the Tdap vaccination are the same symptoms that petitioner associated with a
deer tick bite that occurred two weeks prior. In his affidavit, petitioner stated, “The night of March
16, 2014, I woke abruptly when my back, jaw, shoulder and arms went into severe spasm.” Pet.
Aff. at ¶ 5. It may be that petitioner experienced these symptoms on the night of March 16, 2014,
but he was already experiencing pain in his bilateral shoulders, arms and jaw prior to receiving the
Tdap vaccination. Further, petitioner had a history of lower-back and hip pain that existed at least
two years prior to the vaccination, as evidence in the petitioner’s medical records prior to receiving
the vaccination and two MRIs showing multilevel spondylotic disc disease with progression.
The record establishes that most of petitioner’s symptoms of pain began prior to the
vaccination and cannot be attributed to the Tdap vaccination he received on March 14, 2014.
B. Petitioner’s Injury
The petitioner has failed to establish that he suffered a “vaccine-related injury.” A
petitioner asserting an “off-Table” injury must specify the vaccine-related injury and shoulders the
burden of proof on causation. Broekelschen at 1346. Identifying an injury is prerequisite to
applying the Althen analysis. Id. Petitioner must show that he suffers from a “defined” and
“medically recognized” injury, not “merely…a symptom or manifestation of an unknown injury.”
Lombardi at 1353. Medical recognition of the injury claimed is critical. Id. As the Federal Circuit
reiterated in Lasnetski, a “petitioner needs to make a showing of at least one defined and
recognized injury,” Lasnetski v. Sec’y of Health & Human Servs., 696 Fed.Appx. 497, 504 (Fed.
Cir. 2017) (emphasis added) (citing Lombardi at 1353).
When determining whether petitioner has adequately proven a demonstrable injury, special
masters analyze petitioner’s complete medical records filed into the record. § 300aa-11(c)(2).
20
Medical records created contemporaneously with the events they describe are presumed to be
accurate and complete such that they present all relevant information on a petitioner’s health
problems. Cucuras, at 1528. Subsequent statements made by third parties that contradict
contemporaneous medical records are less persuasive to special masters than the medical records.
Campbell ex rel. Campbell v. Sec’y of Health & Human Servs., 69 Fed. Cl. 775, 779 (2006).
Petitioner argued that the vaccine injury is “back and shoulder pain, in addition to regional
pain” and this injury is well documented in the medical records. Pet. Mot. at 11. Petitioner asserted
that he had a somatic disorder which made him react physically to a confirmed local reaction more
severely than he would have had he not had an existing somatic disorder. Id. Petitioner stated that
his treating physician, Dr. Shic, noted that petitioner experienced a reaction to the Tdap
vaccination. Petitioner made it clear that he was not alleging that the vaccine caused his
psychological disorder, but rather it was his existing underlying psychological disorder that made
him experience a more severe reaction. Pet. Reply at 2.
Respondent argued that petitioner does not have a compensable injury. Resp. Response at
9. Respondent stated that at best, petitioner showed a local reaction to vaccination, but no sequalae
lasted more than six months, his pre-existing medical conditions explain the post-vaccination
reaction, and somatic reactions are not compensable in the Vaccine Program. Id.
Here, petitioner does not allege a defined and recognized injury. Instead, petitioner argued
his injury is “back and shoulder pain and regional pain,” which was made worse by this
psychological reaction. Pet. Mot. at 11. However, these are symptoms of a non-specific injury
and do not constitute a defined recognized injury sufficient for compensation under the Act. A
“vaccine-related injury” must “be more than just a symptom or manifestation of an unknown
injury,” because such a symptom or manifestation could indicate any number of different
underlying injuries, each with its own pathology, making it impossible for the court to accurately
determine causation. See Lombardi at 1352 (citing Broekelschen at 1349).
The treating doctors considered multiple diagnoses over the time course at issue in this
case. Even though the petitioner’s primary care physician, Dr. Shic, initially indicated petitioner
experienced some reaction to the Tdap vaccination, neither him nor his rheumatologist, settled on
a consistent condition or injury that could be related to the Tdap vaccination. Dr. Shic initially
noted that petitioner likely experienced an “Adverse effect of drug. Note: likely tdap side effect,”
after petitioner reported “diffuse muscle cramping.” Pet. Ex. 4 at 270. Later, however, Dr. Shic
contacted the petitioner to explain to petitioner that he had diabetes, “which could explain some of
your recent symptoms.” Id. at 310. Petitioner’s rheumatologist, Dr. Gratton, first diagnosed
petitioner with bilateral bursitis, but also considered a differential diagnosis of polymyalgia
rheumatica. Pet. Ex. 4 at 359. However, later Dr. Gratton stated, in a note to Dr. Linda May, “I
am having a hard time at this point finding a treatable diagnosis for him. If his symptoms are the
same [in] the pelvis region when I see him, do you have any thoughts at this point?” Id. at 551.
Eventually, in September 2014, Dr. Gratton diagnosed petitioner with multiple joint pain and low
back pain. Pet. Ex. 4 at 486. Subsequently, when petitioner presented to Dr. Gratton after a two-
year gap in appointments, she diagnosed him with lumbar radiculopathy and hypertension. Id. at
559.
21
Petitioner’s experts also did not identify a specific injury to which petitioner suffered
following the Tdap vaccination. Dr. Gershwin stated that “it is more likely than not that
[petitioner] did develop some myalgias following the Tdap,” however, he continued by opining
that petitioner was misdiagnosed with polymyalgia rheumatica, and a more appropriate diagnosis
was “poorly controlled diabetes,” and fibromyalgia. Pet. Ex. 7 at 1-2. Further, Dr. Gershwin
stated, “I should note that vaccination does not produce fibromyalgia.” Id.
Dr. Singer, a neuropsychologist, did not identify a defined or recognized injury either.
Instead, Dr. Singer opined that petitioner may have been suffering from “brachial neuritis (a
condition associated with the tetanus vaccine, see vaccine package insert), even though “the
claimant did not receive a diagnosis of brachial neuritis.” Pet. Ex. 9 at 8. However, there is nothing
in the medical records to suggest that petitioner’s doctors were considering brachial neuritis, nor
are any of the symptoms petitioner was exhibiting after the vaccination consistent with brachial
neuritis. Further, Dr. Singer’s reference to brachial neuritis was well outside his field of expertise
as a neuropsychologist.
Dr. Singer opined that petitioner was in good health prior to receiving the vaccine, but had
an existing “probable psychosomatic conversion disorder,” that made petitioner’s “reaction more
severe and long-lasting.” Pet. Ex. 9 at 8. However, Dr. Singer ignored petitioner’s pre-existing
pain problems to support his conclusion that there was a temporal association between the vaccine
administration and the onset of petitioner’s symptoms. Pet. Ex. 9 at 8. The medical records
demonstrate the petitioner was experiencing bilateral shoulder pain, right jaw pain, right knee pain
and lower back pain the day he received the Tdap vaccine. Additionally, petitioner indicated he
was experiencing stress in his life related to an interpersonal issue with a neighbor and a female
crew team he had been coaching, so much so, that his primary care physician referred him to a
mental health specialist. See Pet. Ex. 4 at 262, 265.
Petitioner’s complaints of a migratory pain condition which none of his treating physicians
could attribute to any particular injury or condition created a significant problem in demonstrating
he suffered an immune mediated illness or mechanical injury that could be related to the vaccine.
In the months following the vaccination, petitioner complained of right arm pain, then left arm
then simultaneously both arms and shoulder pain as well as back, buttocks and leg pain, jaw pain
and “exquisite wrist pain” all of which he attributes to a vaccine reaction. See. Pet. Ex. 4 at 353,
423, 457. His low back, buttock and leg pain, at times referred to as sciatica, could easily be
attributed to the MRI documented spondylotic disc disease, facet arthropathy, and spinal stenosis
at L4-5 and L5-S1 with no causal relationship to the vaccination. See Pet. Ex. 4 at 507. His other
symptoms are more difficult to categorize or relate to one another on a physiological basis.
To their credit, petitioner’s experts, Dr. Gershwin and Dr. Singer did not propose a specific
autoimmune or musculoskeletal diagnosis. Although Dr. Gershwin labeled petitioner’s condition
as fibromyalgia, not attributable to a vaccine, the focus of his report was on the petitioner’s
underlying psychological vulnerability, pre-existing musculoskeletal issues, misdiagnosis of an
autoimmune disorder and consequent over-treatment leading to petitioner’s mental fixation on the
possibility of having a debilitating disease caused by the Tdap vaccine.
Dr. Singer’s report also focused on petitioner’s mental status at the time he received the
22
vaccine. Dr. Singer stated that petitioner had a “probable psychosomatic conversion disorder,”
which amplified petitioner’s pain symptoms. However, Dr. Singer does not consider the vaccine
to be the cause of petitioner’s conversion disorder-instead he attributes petitioner’s underlying,
psychological vulnerabilities to be the cause of petitioner’s severe and long-lasting pain. Further,
Dr. Singer’s only statement of vaccine causation is “there is a temporal relationship between the
vaccine administration and the onset of symptoms,” which is insufficient alone to sustain a Vaccine
claim. See Althen, 418 F. 3d at 1278.
In response to respondent’s argument that somatic reactions are not compensable.
petitioner argued that his vaccine injury is generalized back and shoulder pain and not a
psychological disorder, therefore respondent’s reliance on these cases were misplaced. Pet. Reply
at 2. Petitioner specifically argues that the respondent’s reliance on Ruiz is misplaced. Id. In Ruiz,
the Special Master dismissed the claim, finding that the petitioner had no organic basis for her
symptoms, but instead was diagnosed with a conversion disorder. Ruiz v. Sec’y of Health &
Human Servs., No. 02-156V, 2007 WL 5161612 (Fed. Cl. Spec. Mstr. Mar. 14, 2007). The Court
of Federal Claims affirmed the Special Master’s decision, finding that the petitioner failed to
establish that the vaccine caused or significantly aggravated her psychological condition and only
established a temporal proximity between the vaccine and the onset of her psychological condition.
Ruiz v. Sec’y of Health & Human Servs., 2007 WL 5161754, Fed. Cl. (2007). Respondent also
cited to Pless, where the Special Master dismissed the case, finding that the petitioner’s treating
physicians attributed her physical complaints to somatization instead of a vaccine-related injury.
Pless v. Sec’y of Health & Human Servs., No. 16-271V, 2017 WL 836610 (Fed. Cl. Spec. Mstr.
Feb. 6, 2017). In Pless, the petitioner’s underwent numerous tests that came back normal and her
treating physician suspected that petitioner had a functional somatic disorder. Pless, 2017 WL
836610*4. The respondent also cited to Bailey, where the former Chief Special Master Campbell-
Smith, dismissed the petition, finding that the petitioner failed to establish that the flu vaccine
caused him to suffer a post-vaccinal encephalopathy and reactive depression. Bailey v. Sec’y of
Health & Human Servs., No. 06-464V, 2008 WL 482359 (Fed. Cl. Spec. Mstr. Jan. 31, 2008). In
Bailey, the petitioner’s treating physicians uniformly agreed that there was no evidence of a
neurological basis for the petitioner’s complaints and it was suggested that petitioner was
susceptible to somatoform disorders. 2008 WL 482359*7.
Petitioner’s case is no different than the cases discussed above. In Ruiz, Pless and Bailey,
none of the petitioners’ treating physicians could identify a biological explanation for their alleged
symptoms, but instead pointed to a psychological condition that may have explained their
symptoms. Here, petitioner’s own treating physicians are unable to identify a physiological
explanation for his pain symptoms, offering multiple explanations, including uncontrolled
diabetes, lumbar spondylosis, osteoarthritis and even a self-reported tick bite that occurred two
weeks prior to receiving the vaccine. It is petitioner’s experts that opined petitioner’s migratory
pain complaints were better explained by a psychological reaction to multiple stressors in his life
that happened to coincide with the administration of the Tdap vaccine.
The Vaccine Act requires a petitioner to allege a “defined and recognized injury,” that
defines injury as a “vaccine-related injury” as an “illness, injury, condition or death.” §300aa-
11(c); §300aa-333(5). While the Act does not require a petitioner to allege a specific diagnosis, a
defined and recognized injury must be more than “merely a symptom or manifestation of an
23
unknown injury.” Lombardi, 656 F.3d at 1353. Here, petitioner has not presented evidence of a
defined or recognized injury. Rather petitioner presented evidence of a series of migratory pain
complaints (symptoms) to which his treating physicians are unable to attribute to a specified injury,
illness or condition. Instead, petitioner’s treating physicians offer varying explanations for his
migratory pains. Further, petitioner’s experts were unable to offer a physiological explanation for
petitioner’s migratory pain and opined that petitioner’s pain was attributable to a psychological
reaction to co-existing stressors in his life, including a transient reaction to the vaccine. The
significant list of traumatic life events in the petitioner’s history provided more than fertile ground
for somatization with the occurrence of the post vaccinal pain, providing a psychologically
explanation for his somatic symptoms.
Petitioner has not shown a recognized injury, an autoimmune basis for his pain or a local
mechanical injury to his left shoulder that persisted for more than six months. Thus, his condition
cannot be causally related to the Tdap vaccine. Therefore, petitioner has not demonstrated a
compensable injury to which three-pronged Althen analysis can be applied.
VI. Conclusion
The petitioner’s pain complaints can be attributed to both his pre-existing musculoskeletal
history that is well documented in the medical record and also as a likely product of
psychologically based symptom amplification. This is not to say that petitioner did not actually
experience pain secondary to the complex. However, petitioner has failed to establish that the
Tdap vaccine he received on March 14, 2014 was the cause of his migratory pain complaints.
Further, the petitioner has failed to establish that his pain complaints manifested to a “recognized
and definable injury,” as required by the Vaccine Act.
Accordingly, the petitioner is not entitled to compensation and the petition is DISMISSED.
IT IS SO ORDERED.
s/Thomas L. Gowen
Thomas L. Gowen
Special Master
24
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IN THE COURT OF CRIMINAL APPEALS
OF TEXAS
NO. AP-76,090
EX PARTE CHARLES FRANKIE NIETO, Applicant
ON APPLICATION FOR A WRIT OF HABEAS CORPUS
CAUSE NO. 4-95-95-A-A IN THE 114 TH JUDICIAL DISTRICT COURT
FROM SMITH COUNTY
Per curiam.
OPINION
Pursuant to the provisions of Article 11.07 of the Texas Code of Criminal Procedure, the
clerk of the trial court transmitted to this Court this application for writ of habeas corpus. Ex parte
Young, 418 S.W.2d 824, 826 (Tex. Crim. App. 1967). Applicant was convicted of murder and
sentenced to life imprisonment. The Twelfth Court of Appeals affirmed his conviction. Nieto v.
State, No. 12-95-00204-CR (Tex. App. – Tyler, May 29, 1997, no pet.)
Applicant contends, inter alia, that his appellate counsel rendered ineffective assistance
because he failed to communicate with Applicant regarding the content and progress of the appeal,
filed an appeal that failed to raise meritorious points of error was insufficiently briefed, and failed
2
to advise Applicant when the court of appeals affirmed the conviction so that Applicant could pursue
discretionary review. We remanded this application to the trial court for findings of fact and
conclusions of law.
The trial court has determined that there is no evidence that appellate counsel communicated
with Applicant either before or after filing the appeal of this matter, or that appellate counsel
informed Applicant that his conviction had been affirmed and that Applicant had a right to file a pro
se petition for discretionary review. The trial court recommends granting Applicant the opportunity
to file an out-of-time petition for discretionary review. However, because appellate counsel’s
deficient performance amounted to the deprivation of counsel during the direct appeal, we find that
Applicant is entitled to the opportunity to file an out-of-time appeal of the judgment of conviction
in Case No. 4-95-95-A-A from the 114th Judicial District Court of Smith County. Applicant is
ordered returned to that time at which he may give a written notice of appeal so that he may then,
with the aid of counsel, obtain a meaningful appeal. All time limits shall be calculated as if the
sentence had been imposed on the date on which the mandate of this Court issues. We hold that,
should Applicant desire to prosecute an appeal, he must take affirmative steps to file a written notice
of appeal in the trial court within 30 days after the mandate of this Court issues. Applicant's
remaining claims are dismissed. See Ex parte Torres, 943 S.W.2d 469 (Tex. Crim. App. 1997).
Delivered: February 4, 2009
Do Not Publish
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50 F.3d 1
NOTICE: First Circuit Local Rule 36.2(b)6 states unpublished opinions may be cited only in related cases.Joseph ROBERTS, a/k/a Joseph Coral, Petitioner, Appellant,v.George GRIGAS, ETC., Respondent, Appellee.
No. 94-1818
United States Court of Appeals,First Circuit.
Mar. 24, 1995
Appeal from the United States District Court for the District of Massachusetts [Hon. Joseph L. Tauro, U.S. District Judge ]
Valeriano Diviacchi on brief for appellant.
Scott Harshbarger, Attorney General, and William J. Duensing, Assistant Attorney General, on brief for appellee.
D.Mass.
AFFIRMED.
Before TORRUELLA, Chief Judge, SELYA and BOUDIN, Circuit Judges.
PER CURIAM.
1
In September 1984, petitioner, Joseph Roberts, was convicted of armed robbery. His court-appointed attorney timely filed a notice of appeal. Later, counsel filed a motion to withdraw which the Massachusetts Appeals Court denied. Ultimately, the Appeals Court dismissed petitioner's appeal on November 10, 1986, counsel never having filed a brief on petitioner's behalf.
2
Upon discovering this in 1991, petitioner filed, in the Appeals Court, a pro se motion to reinstate his appeal. In support, he argued that he had not authorized his attorney to forego the direct appeal of his conviction. As a result, petitioner went on, his right to the effective assistance of counsel, as secured by the Sixth and Fourteenth Amendments, had been violated. The Appeals Court denied both the motion to reinstate and a subsequent request for reconsideration. The Massachusetts Supreme Judicial Court ("SJC") denied petitioner's request for further appellate review.
3
In April 1992, petitioner filed this habeas petition under 28 U.S.C. Sec. 2254. He again claimed that his court- appointed attorney's conduct had been constitutionally defective. The district court appointed counsel to represent petitioner, but dismissed the habeas petition on the ground that petitioner had not exhausted his state remedies. See 28 U.S.C. Sec. 2254(b). Specifically, the court held that Mass. R. Crim. P. 30(b)1 provided petitioner with a chance to present his ineffective assistance claim to the courts of the Commonwealth. Thus, petitioner was required to exhaust this remedy under Sec. 2254(c).2 We agree.
4
As a matter of comity, "[t]he exhaustion principle ensures that state courts have the first opportunity to correct their own constitutional errors." Mele v. Fitchburg Dist. Court, 850 F.2d 817, 819 (1st Cir. 1988). Although an applicant for the writ is not required to exhaust every conceivable state procedure before filing his or her claim in federal court, the applicant "is at risk to present the state courts with a fair opportunity to confront and correct an alleged infirmity." Id. at 818-19. Here, there appears to be no question that petitioner's motions alerted both the Appeals Court and the SJC to the constitutional dimensions of his ineffective assistance of counsel claim. Thus, the question is whether the context in which this claim was raised constitutes "fair presentation." Castille v. Peoples, 489 U.S. 346 (1989).
5
In Castille, a Sec. 2254 petitioner presented new constitutional claims in his request for allocatur to the Pennsylvania Supreme Court; such review is discretionary. The United States Supreme Court held that the exhaustion requirement is not satisfied "where the claim has been presented for the first and only time in a procedural context in which its merits will not be considered unless 'there are special and important reasons therefor.' " Id. at 351 (citation omitted). We think it obvious that when the Appeals Court considers a motion to reopen or reinstate an appeal five years after the appeal's dismissal, its review is discretionary. The same goes for the SJC's decision whether to grant further appellate review. Consequently, petitioner has not exhausted his state remedies.
6
"The requisite exhaustion may nonetheless exist, of course, if it is clear that [petitioner's] claims are now procedurally barred under [Massachusetts] law." See id. Our task then is to determine whether the Massachusetts courts would permit petitioner to pursue his claim in a Rule 30(b) motion. "[I]n determining whether a remedy for a particular constitutional claim is 'available,' the federal courts are authorized, indeed required, to assess the likelihood that a state court will accord the habeas petitioner a hearing on the merits of his claim." Harris v. Reed, 489 U.S. 255, 268 (1989) (O'Connor, J., concurring).
7
In Commonwealth v. Cowie, 404 Mass. 119, 533 N.E.2d 1329 (1989), the defendant, whose direct appeal had been forfeited by his attorney, filed a motion in the SJC to reinstate his appeal. A single justice denied the motion pointing out that the post-conviction remedies in Rule 30(a) and (b) were available. Defendant then filed a Rule 30(a) motion in the superior court in an effort to secure appellate review. The court denied the motion for reasons not relevant here. The defendant declined the superior court's invitation to file a Rule 30(b) motion, preferring to appeal to the SJC.
8
The SJC first rejected defendant's argument that the Constitution required it to provide him with a late appeal. 404 Mass. at 121, 533 N.E.2d at 1331. In so doing, it relied on Evitts v. Lucey, 469 U.S. 387 (1985). In Evitts, the Supreme Court held that the Fourteenth Amendment due process clause is violated when a criminal defendant does not have the effective assistance of counsel on an appeal as of right. Id. at 396. The Court noted, though, that a state need not provide the defendant with a new appeal so long as the substitute relief is constitutionally adequate. Id. at 399. As an example of such a remedy the Court referred to a post- conviction attack on the conviction. Id. Based on this, the SJC held that Rule 30(b) "fully accords with due process as a remedy for the defendant's frustrated right of appeal." 404 Mass. at 122-23, 533 N.E.2d at 1332.
9
Petitioner correctly points out that where counsel's dereliction results in the loss of a direct criminal appeal, habeas relief is available without a showing that the direct appeal has merit. See Bonneau v. United States, 961 F.2d 17, 23 (1st Cir. 1992); Wilbur v. State of Maine, 421 F.2d 1327, 1330 (1st Cir. 1970). In Wilbur, a Sec. 2254 applicant alleged that his attorney had failed to pursue a direct appeal from the applicant's conviction. As here, the applicant filed a motion to reinstate the appeal, arguing that he had received ineffective assistance of counsel. The Maine Supreme Judicial Court denied the motion, noting that no injustice would result from its denial.
10
We specifically found that the applicant had presented his constitutional claims to the Maine SJC, thereby exhausting state remedies. 421 F.2d at 1330. We also rejected the Maine SJC's indication that the merits of the applicant's direct appeal were relevant to a decision whether the applicant had received ineffective assistance of counsel. Id. We therefore remanded the matter to the district court with instructions to grant the writ if the state could not show that the applicant's ineffective assistance of counsel claim was without merit and if the Maine Supreme Judicial Court refused to reinstate the appeal. Id.
11
Petitioner asserts that, contrary to Wilbur, the district court here is requiring him to seek state review of the merits of his lost appeal via Rule 30(b). We do not read the district court's order in this way. Although Cowie held that Rule 30(b) is an appropriate substitute for a lost appeal, there is no indication that Rule 30(b) is limited to the consideration of the merits of the appeal. Put another way, Rule 30(b) apparently remains available for the determination that petitioner received ineffective assistance of counsel-the prerequisite to obtaining state review of petitioner's appellate arguments. We finally note that although Wilbur contemplated reinstatement of the direct appeal, Castille now requires the exhaustion of Rule 30(b) in this instance.
12
The judgment of the district court is summarily affirmed. See Local Rule 27.1.
1
Rule 30(b) provides:
New Trial. The trial judge upon motion in writing may grant a new trial at any time if it appears that justice may not have been done. Upon the motion the trial judge shall make such findings of fact as are necessary to resolve the defendant's allegations of error of law.
2
Section 2254(c) provides that "[a]n applicant shall not be deemed to have exhausted the remedies available in the courts of the State ... if he has the right under the law of the State to raise, by any available procedure, the question presented."
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NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 12a0033n.06
FILED
No. 10-3973
Jan 10, 2012
UNITED STATES COURT OF APPEALS LEONARD GREEN, Clerk
FOR THE SIXTH CIRCUIT
UNITED STATES OF AMERICA, )
)
Plaintiff-Appellee, )
) ON APPEAL FROM THE
v. ) UNITED STATES DISTRICT
) COURT FOR THE NORTHERN
JONATHAN LEIGH PHILLIPS, ) DISTRICT OF OHIO
)
Defendant-Appellant. )
)
BEFORE: SUHRHEINRICH, GIBBONS, and McKEAGUE, Circuit Judges.
PER CURIAM. Jonathan Leigh Phillips appeals the sentence imposed by the district court
following his guilty plea to receiving or distributing visual depictions of minors engaged in sexually
explicit conduct, in violation of 18 U.S.C. § 2252(a)(2), receiving or distributing child pornography,
in violation of 18 U.S.C. § 2252A(a)(2), and possessing child pornography, in violation of 18 U.S.C.
§ 2252A(a)(5)(B). The district court adopted the offense level calculations in the presentence report,
which determined that Phillips’s total offense level was 37 and that his criminal history category was
IV. The court determined that Phillips’s guidelines range of imprisonment was 292 to 365 months,
but that he was subject to a statutory maximum sentence of 240 months. The court sentenced
Phillips to an effective term of 160 months in prison.
On appeal, Phillips argues that the sentence was procedurally and substantively unreasonable
for several reasons: (1) the district court erroneously concluded that the child pornography
sentencing guidelines were based on empirical data and the Sentencing Commission’s own expertise
No. 10-3973
United States v. Phillips
rather than congressional directives; (2) the court improperly deferred to the child pornography
guidelines, which are inherently flawed; and (3) the court failed to properly consider his risk of
recidivism.
We review sentences for both procedural and substantive reasonableness using an abuse-of-
discretion standard. Gall v. United States, 552 U.S. 38, 51 (2007). To determine whether a sentence
is procedurally reasonable, we must “ensure that the district court committed no significant
procedural error, such as failing to calculate (or improperly calculating) the Guidelines range,
treating the Guidelines as mandatory, failing to consider the [18 U.S.C.] § 3553(a) factors, selecting
a sentence based on clearly erroneous facts, or failing to adequately explain the chosen sentence.”
Id. “For a sentence to be substantively reasonable, it must be proportionate to the seriousness of the
circumstances of the offense and offender, and sufficient but not greater than necessary, to comply
with the purposes of § 3553(a).” United States v. Vowell, 516 F.3d 503, 512 (6th Cir. 2008) (internal
quotation marks omitted). “A sentence may be substantively unreasonable if the district court selects
the sentence arbitrarily, bases the sentence on impermissible factors, fails to consider pertinent
§ 3553(a) factors or gives an unreasonable amount of weight to any pertinent factor.” Id. at 510
(internal quotation marks and alterations omitted). We apply a rebuttable presumption of
reasonableness to a within-guidelines sentence, see United States v. Vonner, 516 F.3d 382, 389 (6th
Cir. 2008) (en banc), and a defendant’s burden to demonstrate that a below-guidelines sentence was
unreasonable is even more demanding. United States v. Curry, 536 F.3d 571, 573 (6th Cir. 2008).
The district court’s below-guidelines sentence was not unreasonable. Phillips has not shown
that the court relied on any significant factual inaccuracy concerning the history of the child
pornography guidelines by adopting the discussion set forth in United States v. Cunningham, 680
-2-
No. 10-3973
United States v. Phillips
F. Supp. 2d 844, 849-51 (N.D. Ohio 2010). Further, although the district court had discretion to
disagree with the child pornography guidelines for policy reasons and to reject the guidelines range
because of that disagreement, it was not required to do so. See United States v. Brooks, 628 F.3d
791, 799-800 (6th Cir.), cert. denied, 131 S. Ct. 3077 (2011). Finally, the district court gave proper
consideration to Phillips’s risk of recidivism by weighing the conclusions in the psychological
evaluation with the difficulty of predicting future behavior and Phillips’s long history of viewing
child pornography.
Accordingly, we affirm the district court’s sentence.
-3-
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Opinion issued August 2, 2016
In The
Court of Appeals
For The
First District of Texas
————————————
NO. 01-15-00973-CR
———————————
EX PARTE CARLOS ALEXANDER AGUILAR, Appellant
On Appeal from the 339th District Court
Harris County, Texas
Trial Court Case No. 1248496-A
OPINION
Carlos Alexander Aguilar appeals from the denial of his post-conviction
application for writ of habeas corpus, complaining that the trial court abused its
discretion by not holding an evidentiary hearing on his application.
Background
Aguilar, who was born in El Salvador, was residing in the United States
under temporary protected status (TPS). In 2010, Aguilar was charged with the
offense of aggravated sexual assault of a child by having sexual intercourse with a
13-year-old girl when he was 18 years old. See TEX. PENAL CODE ANN.
§ 22.021(b) (West Supp. 2015). He eventually pleaded guilty to the offense of
indecent exposure to a child1 and received deferred adjudication community
supervision.
Aguilar filed an application for writ of habeas corpus, asserting that his trial
counsel was ineffective for failing to advise him of the potential immigration
consequences for pleading guilty and for advising him against going to trial.
Attached to the application were two affidavits: (1) an immigration attorney,
Bianca Santorini, who averred that Aguilar had not been properly admonished
about the immigration consequences, and that if he had, he might have sought a
jury trial or a better plea; and (2) the complainant in the underlying criminal case,
who averred that she was never interviewed questioned by Aguilar’s attorney or
the District Attorney. The hearing date on the application was reset until October
8, 2015. According to the affidavit of Aguilar’s counsel, he appeared on October 8
for the hearing with a number of witnesses, but was advised that the trial court had
1
See TEX. PENAL CODE ANN. § 21.11(a) (West 2011).
2
denied the application and no hearing would be held. Aguilar’s counsel maintains
that when he approached the bench to insist that he be permitted to present his
evidence, the trial court responded that he could appeal the ruling.
Aguilar filed a motion for new trial, claiming the trial court violated his right
to due process and abused its discretion by not advising counsel that the trial court
would not hear live testimony. Counsel attached to the motion for new trial the
affidavits of the witnesses he had planned to call at the hearing, including
(1) defense counsel, Shawn Rudisel, who represented him in the aggravated sexual
assault case; (2) Liseth Arevalo, the complainant; (3) Bianca Santorini, an
immigration attorney; (4) Aguilar; (5) Aguilar’s mother; (6) Aguilar’s brother; and
(7) DaSean A. Jones, the attorney who filed the habeas application. None of the
witnesses, other than his defense counsel, stated that they were present during all
of the conversations with his attorney or when the trial court accepted his plea.
Standard of Review
The denial of Aguilar’s application for writ of habeas corpus is one within
the trial court’s discretion and may be overturned only if we find the trial court
abused its discretion. See Kniatt v. State, 206 S.W.3d 657, 664 (Tex. Crim. App.
2006). The generally-applied abuse of discretion standard is not appropriate
“when the decision does not turn on the credibility or demeanor of witnesses.” Ex
parte Martin, 6 S.W.3d 524, 526 (Tex. Crim. App. 1999). Statutory construction is
3
a question of law that we review de novo. Spence v. State, 325 S.W.3d 646, 650
(Tex. Crim. App. 2010).
Analysis
Aguilar challenges the trial court’s refusal to hold a hearing as an abuse of
discretion and a violation of his right of due process. The State responds that
Aguilar’s complaints were not preserved for review because Aguilar did not obtain
a ruling on his request for a hearing and object to the ruling. See Lovill v. State,
319 S.W.3d 687, 691–92 (Tex. Crim. App. 2009) (stating that to preserve
complaint, record must show specific and timely complaint and trial court ruling
on complaint); Ex parte Luciw, No. 03–08–00445–CR, 2009 WL 5150018, at *3
(Tex. App.—Austin Dec. 31, 2009, no pet.) (mem. op., not designated for
publication) (holding error not preserved because record contained no request for
trial court hearing). The record contains no request for a hearing and no ruling
denying a request.
A trial court is not required to hold a hearing. Article 11.072 delineates the
process for habeas applications when an applicant seeks relief from a judgment of
conviction that orders community supervision, as occurred here. See TEX. CODE
CRIM. PROC. ANN. art. 11.072 § 1. The relevant provisions are:
(a) Not later than the 60th day after the day on which the
state’s answer is filed, the trial court shall enter a
written order granting or denying the relief sought in
the application.
4
(b) In making its determination, the court may order
affidavits, depositions, interrogatories, or a hearing
and may rely on the court’s personal recollection.
Id. at art. 11.072 § 6.
Although Aguilar claims he was entitled to an evidentiary hearing, article
11.072 does not require the trial court to hold any hearing—let alone an
evidentiary hearing—before rendering its decision. See Ex parte Franklin, 310
S.W.3d 918, 922–23 (Tex. App.—Beaumont 2010, no pet.) (holding that trial court
is not required to hold oral hearing when determining whether to deny habeas
application alleging ineffective assistance of counsel); see also Ex parte Godinez,
No. 10–13–00063–CR, 2014 WL 98816, at *2 (Tex. App.—Waco Jan. 9, 2014,
pet. ref’d) (mem. op., not designated for publication) (stating that article 11.072
does not require court to hold evidentiary hearing).
The trial court may consider affidavits attached to an application as evidence
without a hearing. See Ex parte Cummins, 169 S.W.3d 752, 757 (Tex. App.—Fort
Worth 2005, no pet.). Because the statute does not require a hearing, the trial
court’s decision to rule based on the submitted affidavits did not violate Aguilar’s
due process rights. See In re Pesina, No. 07–15–00380–CR, 2016 WL 383845, at
*2 (Tex. App.—Amarillo Jan. 27, 2016) (mem. op., not designated for publication)
(article 11.072 provides variety of ways for court to reach decision and no due
process violation shown simply because trial court held no evidentiary hearing); Ex
5
parte Hollowell, No. 03–11–00240–CR, 2012 WL 1959309, at *6–7 (Tex. App.—
Austin June 1, 2012) (overruling due process challenge because article 11.072 does
not require a hearing), pet. ref’d, 392 S.W.3d 661 (Tex. Crim. App. 2013).
Aguilar also contends the trial court violated the Code of Judicial Conduct.
Canon 3(B)(8) provides: “A judge shall accord to every person who has a legal
interest in a proceeding, or that person’s lawyer, the right to be heard according to
law.” Tex. Code Jud. Conduct, Canon 3(B)(8), reprinted in TEX. GOV’T CODE
ANN., tit. 2, subtit. G., app. B (West 2013). Because article 11.072 does not
require a trial court to hold a hearing on an application for writ of habeas corpus,
the trial court did not violate the Code of Judicial Conduct.
Finally, Aguilar claims the trial court violated the Code of Judicial Conduct
by having ex parte communications with the State. See Tex. Code Jud. Conduct,
Canon 3(B)(8), reprinted in TEX. GOV’T CODE ANN., tit. 2, subtit. G., app. B.
Aguilar contends the State was given notice of the trial court’s intent to have a
hearing by affidavit rather than by live testimony, but he was not. Aguilar,
however, presents no proof of ex parte communications and no evidence of
ongoing bias or prejudice toward Aguilar.
Conclusion
Because Aguilar has not shown the trial court abused its discretion, we
affirm the trial court’s judgment.
6
Harvey Brown
Justice
Panel consists of Justices Keyes, Brown, and Huddle.
Publish. TEX. R. APP. P. 47.2(b).
7
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816 F.Supp.2d 793 (2009)
JONATHAN BROWNING, INC., Plaintiff,
v.
VENETIAN CASINO RESORT LLC, et al., Defendants.
No. C 07-03983 JSW.
United States District Court, N.D. California.
October 6, 2009.
Trenton Herbert Norris, Arnold & Porter LLP, San Francisco, CA, Anthony Edward *794 McNamer, McNamer and Company P.C., Portland, OR, for Plaintiff.
Ray L. Wong, Hancock Rothert & Bunshoft LLP, San Francisco, CA, Courtney Lenore Bunt, for Defendants.
Michelle Hon Donovan, Duane Morris LLP, San Diego, CA, for Plaintiff/Defendants.
ORDER GRANTING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT; DENYING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT; AND FINDING AS MOOT PLAINTIFF'S MOTION TO AMEND
JEFFREY S. WHITE, District Judge.
Now before the Court is the motion for summary judgment filed by Defendants Venetian Casino Resort, LLC, Las Vegas Sands, LLC and Las Vegas Sands Corporation (collectively "Defendants" or "the Venetian") and the motions for summary judgment and for leave to file an second amended complaint filed by Plaintiff Jonathan Browning, Inc. ("Plaintiff"). Having considered the parties' pleadings, the relevant legal authority, and having had the benefit of oral argument, the Court hereby GRANTS Defendants' motion for summary judgment, DENIES Plaintiff's motion for summary judgment, and FINDS AS MOOT Plaintiff's motion to amend the complaint.
BACKGROUND
As alleged in the amended complaint, Jonathan Browning, Inc. is a designer and seller of decorative light fixtures, such as the wall-mounted lighting sconces at issue here. Two of Plaintiff's designs, the Trianon and Ledoux sconces, are at issue in this litigation. Plaintiff alleges that the Defendants purchased 10 sconces from Plaintiff, requested that it bid for 11,368 sconces to be used in the Venetian casino guest room remodel, and, instead of contracting with the design company to produce the lighting fixtures, contacted Plaintiff's manufacturer in China to make copies of the fixtures without Plaintiff's knowledge or permission.
Upon discovering the alleged copying, Plaintiff filed suit seeking damages for copyright infringement and unfair competition based on the production and public display of light fixtures in the casino. Plaintiff alleges that its lighting fixtures are entitled to copyright protection and that the Venetian is liable for direct infringement of its alleged copyrights for making unauthorized derivative works of its hand drawings (Claim One), direct infringement of its alleged copyrights for making unauthorized copies of its light fixtures (Claim Two) and for the unauthorized public display of the same light fixtures (Claim Three). Plaintiff also alleges that the Venetian is liable for inducement of copyright infringement and contributory copyright infringement for allegedly inducing or contributing to the reproduction of unauthorized copies of Plaintiff's light fixtures by the third-party manufacturer in China, Diamond Life (Claims Four and Five). Plaintiff further alleges that Venetian is vicariously liable for direct infringement by Diamond Life, based on the allegation that Defendants allegedly had both the ability and the right to supervise Diamond Life's infringing conduct and to prevent such conduct (Claim Six). Lastly, Plaintiff alleges that Defendants are liable for statutory unfair competition under California Business and Professions Code Section 17200 and common law unfair competition (Claims Seven, Eight and Nine).
Just before filing this lawsuit, Plaintiff filed two applications for copyright registrations for the Trianon and Ledoux lighting sconces, seeking protection for its "design applied to decorative light fixture." (Declaration of Michelle A. Hon, Ex. C.) *795 Plaintiff also requested that the Copyright Office process his application with special handling due to the pending litigation. (Id. at Ex. D.) In his special handling request, Plaintiff acknowledged that the fixtures were useful articles as defined by the Copyright Act, but that they could still be copyrighted "to the extent that their design incorporates pictorial, graphic, or sculptural features that can be identified separately from their utilitarian aspects." (Id.) In letters dated July 18, 2007 and August 1, 2007, the U.S. Copyright Office refused copyright registration for the two disputed lighting fixtures, stating that "Registration for the above works must be refused because they are `useful articles' which do not contain any separable features that are copyrightable." (Id. at Exs. E and F; emphasis in original.) The Copyright Office found that the separable elements of the works submitted by Plaintiff were not copyrightable "because they represent an insufficient amount of original authorship." (Id.) Although Plaintiff had the right to appeal the decisions of the Copyright Office, there is no evidence that any such appeal was made.
Subsequently, Plaintiff filed applications, with special handling, for copyright of the hand shop drawings of the Trianon and Ledoux light fixtures. (Id. at Ex. G.) The Copyright Office issued copyright registrations just for the drawings. (Id. at Ex. H.)
The Court will address additional specific facts as required in the analysis.
ANALYSIS
A. Cross-Motions for Summary Judgment.
1. Legal Standards Applicable to Motions for Summary Judgment.
Summary judgment is proper when the pleadings, discovery, and affidavits show that there is "no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). The party moving for summary judgment bears the burden of identifying those portions of the pleadings, discovery, and affidavits that demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once the moving party meets its initial burden, the nonmoving party must go beyond the pleadings and, by its own affidavits or discovery, "set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). On an issue for which the opposing party will have the burden of proof at trial, the moving party need only point out "that there is an absence of evidence to support the nonmoving party's case." Id. Inferences drawn from the facts must be viewed in the light most favorable to the party opposing the motion. Masson v. New Yorker Magazine, 501 U.S. 496, 520, 111 S.Ct. 2419, 115 L.Ed.2d 447 (1991).
Actions arising under the Copyright Act must adhere to the same summary judgment standard as any other civil action. Shaw v. Lindheim, 919 F.2d 1353, 1358-59 (9th Cir.1990). Accordingly, copyright claims can be resolved on summary judgment where there is no dispute of material fact. Brown Bag Software v. Symantec Corp., 960 F.2d 1465, 1472 (9th Cir.1992). In particular, "[c]opyrightability is often resolved on summary judgment ... because very often no issues of material fact are in dispute and the only task for the court is to analyze the allegedly copyrightable item in light of applicable copyright law." Sem-Torq, Inc. v. K Mart Corp., 936 F.2d 851, 853 (6th Cir.1991) (citations omitted).
2. Extent of Copyright Protection for Utilitarian or Useful Articles and Deference to Copyright Office Determination.
Pictorial, graphic and sculptural works can receive copyright protection. *796 17 U.S.C. § 102(a)(5). However, such copyright does not fully extend to works that are considered "useful articles." 17 U.S.C. § 101. Only sculptural elements that can be identified separately from, and are capable of existing independently of, the utilitarian aspects of the article receive copyright protection. Id. Copyright does not extend to an element of an article if it has any intrinsic utilitarian function. Fabrica, Inc. v. El Dorado Corp., 697 F.2d 890, 893 (9th Cir.1983). "Only the separable ornamental aspects of a work receive copyright protection, and the protection extends only to that aspect (e.g., a carving on the back of a chair may receive a copyright, but the chair does not)." Smith & Hawken, Ltd. v. Gardendance, Inc., 2005 WL 1806369, *2 (N.D.Cal. July 28, 2005) (citing Fabrica, 697 F.2d at 893). A table lamp with a statuette base may receive copyright protection for the statuette, but not for the entire lamp. Mazer v. Stein, 347 U.S. 201, 74 S.Ct. 460, 98 L.Ed. 630 (1954).
If the sole intrinsic function of an article is its utility, the fact that the article is unique and attractively shaped will not qualify it as a work of art. However, if the shape of a utilitarian article incorporates features such as artistic sculpture, carving, or pictorial representation, which can be identified separately and are capable of existing independently as a work of art, such features will be eligible for registration. Esquire v. Ringer, 591 F.2d 796, 800 (D.C.Cir.1978). In Esquire, the Register of Copyrights determined that the particular lighting fixtures at issue in that case were not eligible for copyright as a work of art. The Register interpreted its own regulations "to bar copyright registration of the overall shape or configuration of a utilitarian article, no matter how aesthetically pleasing that shape or configuration may be." Id. The Register's interpretation of the regulations derives from the principle that "industrial designs are not eligible for copyright" and "registration of the overall shape or configuration of utilitarian articles would lead to widespread copyright protection for industrial designs." Id. at 800, 801.
The court in Esquire acknowledged that there were bound to be inconsistencies in the results of the Register's interpretation:
[t]he Register's test requires the application of subjective judgment, and given the large volume of copyright applications that must be processed there may be some results that are difficult to square with the denial of registration here. But this does not mean that the Register has employed different standards in reaching those decision. The available evidence points to a uniform and long-standing interpretation of [the regulations], and accordingly this interpretation is entitled to great weight.
Id. at 802. The Ninth Circuit has also agreed that "courts should generally defer to the Register's interpretation of the copyright statute" and has expressly held that "the Register has the authority to interpret the copyright laws and that its interpretations are entitled to judicial deference if reasonable." Marascalco v. Fantasy, Inc., 953 F.2d 469, 473 (9th Cir.1991).
In this matter, the United States Copyright Office refused the registration for the two light fixtures designed by Plaintiff as useful articles not having any separable features that are copyrightable. Where registration has been rejected, the plaintiff has the burden of establishing that the work is properly the subject of a copyright, and is not entitled to the prima facie presumptions arising from registration. In this particular case, the two sconces at issue were reviewed pursuant to a special handling request as a predicate to litigation. According to Ralph Oman, *797 Defendants' proffered expert, due to Plaintiff's request that his registration applications receive special handling, "at a minimum, the copyright specialist's refusal would have been reviewed and approved by the head of the Visual Arts Division, if not also the Associate Register of Registration and Recordationall of whom are attorneys with specialized knowledge and expertise in U.S. Copyright Law and the registration of useful articles." (Declaration of Ralph Oman in support of Defendants' opposition to Plaintiff's motion for summary judgment, ¶ 12.)[1]
To establish copyright infringement, a plaintiff must be able to prove: (1) ownership of a valid copyright or the right to enforce one; and (2) copying of constituent elements of the work that are original. Feist Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340, 361, 111 S.Ct. 1282, 113 L.Ed.2d 358 (1991). The Court must give deference to the determination by the Copyright Office that the sconces at issue here are not subject to registration for copyright due to the lack of separable features that are copyrightable. See Marascalco, 953 F.2d at 473. The fact that the two sconces were given special attention by the Copyright Office counsels further in favor of this Court granting deference to its decision. The Copyright Office, and not the Court, has the expertise and experience to make a determination based on its interpretation of its own guiding regulations as well as its own wealth of experience. This Court owes such a determination deference and also finds that the subject sconces do not contain any separable features that are copyrightable. See Smith & Hawken, 2005 WL 1806369 at *2.[2]
Because Plaintiff cannot establish a valid copyright or the right to enforce one for the subject sconces, Plaintiff has failed to meet his burden to establish the basic elements for copyright infringement and, as a matter of law, Defendants cannot be liable for direct, contributory or vicarious copyright infringement. In addition, because causation for the claim for statutory and common law unfair competition is premised upon the infringement of Plaintiff's alleged copyright, and the claim is preempted by federal copyright laws, the Court finds Plaintiff's claims for unfair competition are without merit. See Kodadek v. MTV Networks, Inc., 152 F.3d 1209, 1212-13 (9th Cir.1998) (holding that a state claim for unfair competition is preempted by copyright where the rights that a plaintiff asserts under state law are equivalent to the those protected by the Copyright Act and the work involved falls within the subject matter of the Copyright Act).[3]
*798 B. Plaintiff's Motion to Amend is Moot.
The Court finds as moot Plaintiff's motion to amend. Because the Defendants' motion for summary judgment is granted, there is no need for the Court to reach the merits of Plaintiff's motion to amend.
CONCLUSION
Based on the foregoing reasons, the Court hereby GRANTS Defendants' motion for summary judgment, DENIES Plaintiff's motion for summary judgment, and FINDS AS MOOT Plaintiff's motion to amend the complaint.
A separate judgment shall issue and the Clerk is instructed to close the file.
IT IS SO ORDERED.
NOTES
[1] Although the Court has rejected Defendants' proffered expert testimony on the ultimate issue of the decision of the Copyright Office in this matter, the Court explicitly permitted the testimony regarding the general process for the registration of useful articles and "the procedures for special handling requests." Jonathan Browning, Inc. v. Venetian Casino Resort LLC, 2009 WL 1764652, *1 (N.D.Cal. June 18, 2009).
[2] To the extent the determination that another sconce in the series, the Calais, which is not at issue in this litigation, was granted registration, the Court can only remark, just as the court did in Esquire, that "given the large volume of copyright applications that must be processed, there may be some results that are difficult to square with the denial of registration here." 591 F.2d at 802.
[3] Also, at oral argument, Plaintiff conceded its claim for unfair competition and Plaintiff has not opposed the motion as to its fraudulent competition claim. The Court notes that based on the current record, Plaintiff possibly could have asserted other, state law claims when originally filing its lawsuit. However, based on the claims as pled, although the Court does not condone Defendants' behavior, it finds that Plaintiff is without a federal remedy.
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994 F.Supp. 425 (1998)
Anita SCHULOFF, Plaintiff,
v.
QUEENS COLLEGE FOUNDATION, INC., Defendant.
Anita SCHULOFF, Plaintiff,
v.
BROOKLYN COLLEGE FOUNDATION, INC., Defendant.
Nos. 96-CV-3879 (FB), 96-CV-6310 (FB).
United States District Court, E.D. New York.
March 10, 1998.
Jackson Leeds, Flushing, NY, for plaintiff.
Steven G. Mintz, Mintz & Gold, New York, NY, for defendants.
MEMORANDUM AND ORDER
BLOCK, District Judge.
The above-captioned cases both involve the identical legal issue whether plaintiff Anita Schuloff ("Schuloff") has a private cause of action pursuant to 26 U.S.C. § 6104 based upon the defendants' failure to make their federal tax returns immediately available for her inspection. Defendants Queens College Foundation, Inc. ("Queens College Foundation") and Brooklyn College Foundation, Inc. ("Brooklyn College Foundation") are represented by the same law firm, and both have moved to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(1), or, in the alternative, Federal Rule of Civil Procedure 12(b)(6). The pending motions to dismiss are hereby consolidated for disposition. For the reasons set forth below, defendants' motions to dismiss are granted pursuant to Rule 12(b)(6), and the complaints dismissed.
*426 BACKGROUND
Both cases arise out of a similar set of facts. On July 25, 1996, Schuloff sent a letter to the Queens College Foundation indicating that she intended to come to Queens College the following week to inspect the Queens College Foundation's tax returns. By letter dated July 31, 1996, Executive Director Mario John Delia Pina advised Schuloff that her request to inspect the records should be directed to the appropriate offices of the Internal Revenue Service ("IRS"). Less than one week later, Schuloff commenced the action entitled Anita Schuloff v. Queens College Foundation, Inc. (96-CV-3879). The complaint, which, inter alia, seeks $55,000 in compensatory and $500,000 in punitive damages, alleges that the Queens College Foundation violated 26 U.S.C. § 6104, which requires certain tax-exempt organizations to make their tax returns available for public inspection. Schuloff also alleges that this conduct gives rise to a claim under 42 U.S.C. § 1983 and the New York Freedom of Information Law, N.Y. Public Officers Law § 84 et seq. It is uncontested that on August 19, 1996, attorneys for the Queens College Foundation sent Schuloff's attorney copies of the Form 990s that the Queens College Foundation had filed with the IRS for the preceding five years. However, Schuloff has not discontinued this action and still seeks damages based upon the failure of the Queens College Foundation to make the records available to her immediately.
On November 5, 1996, Schuloff sent a letter to the Brooklyn College Foundation requesting copies of its three most recent tax returns. On December 26, 1996, Schuloff visited the offices of the Brooklyn College Foundation and was not permitted to inspect the tax returns. She commenced the action entitled Anita Schuloff v. Brooklyn College Foundation, Inc. (96-CV-6310) later that day. Like her complaint against the Queens College Foundation, her complaint against the Brooklyn College Foundation contains claims based upon 26 U.S.C. § 6104, 42 U.S.C. § 1983, and New York State law. Schuloff seeks, inter alia, $10,000 in compensatory damages and $250,000 in punitive damages. It is uncontested that on March 13, 1997, the Brooklyn College Foundation mailed copies of its three most recent tax forms to Schuloff's counsel; however, Schuloff has not discontinued her action against this defendant.
DISCUSSION
I. Standard on a Motion to Dismiss
Defendants move to dismiss the complaints pursuant to Rule 12(b)(1) based upon a lack of subject matter jurisdiction, and, alternatively, pursuant to Rule 12(b)(6) based upon Schuloff's alleged failure to state a claim upon which relief can be granted. The Second Circuit has indicated that a case should be dismissed for lack of subject matter jurisdiction "only under narrow circumstances." Nowak v. Ironworkers Local 6 Pension Fund, 81 F.3d 1182, 1188 (2d Cir.1996). "`[T]he test is whether the complaint on its face, without resort to extraneous matter, is so plainly insubstantial as to be devoid of any merits and thus not presenting any issue worthy of adjudication.'" Cushing v. Moore, 970 F.2d 1103, 1106 (2d Cir.1992) (quoting Giulini v. Blessing, 654 F.2d 189, 192 (2d Cir.1981)); see also Hagans v. Lavine, 415 U.S. 528, 536-538, 94 S.Ct. 1372, 39 L.Ed.2d 577 (1974).
The Court concludes that the complaints herein are not so "plainly insubstantial" as to warrant their dismissal for lack of subject matter jurisdiction. Both the Supreme Court and the Second Circuit have equated insubstantiality with frivolousness. See Hagans, 415 U.S. at 537; Monsky v. Moraghan, 127 F.3d 243, 245 (2d Cir.1997) ("A non-frivolous allegation of a cause of action under federal law suffices to invoke federal court jurisdiction."). In an August 5, 1997 order denying a motion by the Queens College Foundation for Rule 11 sanctions against Schuloff, the Court determined that Schuloff's § 6104 claim is not frivolous, as the Second Circuit has not yet addressed whether a private citizen has standing to commence an action pursuant to that statute. Accordingly, the Court determines that it possesses subject matter jurisdiction over these cases, and will therefore proceed based *427 upon defendants' alternative argument that the complaints should be dismissed pursuant to Rule 12(b)(6) because they fail to state a claim for which relief can be granted.
A complaint will be dismissed pursuant to Rule 12(b)(6) "only if it appears that [the plaintiff] can prove no set of facts, consistent with its complaint, that would entitle it to relief." Electronics Communications Corp. v. Toshiba America Consumer Products, Inc., 129 F.3d 240, 242-243 (2d Cir.1997). "The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support his claims." Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974). "[I]n ruling on defendant's motion, the court must accept as true all the factual allegations in the complaint and must draw all reasonable inferences in favor of the plaintiff." Hamilton Chapter of Alpha Delta Phi, Inc. v. Hamilton College, 128 F.3d 59, 63 (2d Cir.1997).
II. 26 U.S.C. § 6104
Section 6104 provides, in pertinent part, that for a three-year period following the filing date for their annual tax returns, certain tax-exempt organizations must make the returns available "for inspection during regular business hours by any individual at the principal office of such organization ..." and must provide copies of such returns without charge. 26 U.S.C. § 6104(e)(1)(A)(i), (ii). It is undisputed that both defendants failed to make their tax returns immediately available to Schuloff, as required by § 6104. However, "the fact that a federal statute has been violated and some person harmed does not automatically give rise to a private cause of action in favor of that person." Cannon v. Univ. of Chicago, 441 U.S. 677, 688, 99 S.Ct. 1946, 60 L.Ed.2d 560 (1979). In Cort v. Ash, 422 U.S. 66, 78, 95 S.Ct. 2080, 45 L.Ed.2d 26 (1975), the Supreme Court set forth the following four factors that should be considered in determining whether to imply a private right of action: (1) whether the plaintiff is part of the class for whose benefit the statute was enacted; (2) whether there is any indication of legislative intent, either explicit or implicit, that would either favor or oppose creation of a private remedy; (3) whether implication of a private remedy is consistent with the underlying purposes of the statute; and (4) whether the cause of action is one traditionally relegated to state law, such that it would be inappropriate to infer the existence of a federal cause of action.
Subsequent to its decision in Cort v. Ash, the Supreme Court held that the four factors described in Cort v. Ash, although all relevant, were not entitled to equal weight. See Touche Ross & Co. v. Redington, 442 U.S. 560, 575, 99 S.Ct. 2479, 61 L.Ed.2d 82 (1979). Rather, "[t]he central inquiry remains whether Congress intended to create, either expressly or by implication, a private cause of action." Id.; see also Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Curran, 456 U.S. 353, 377, 102 S.Ct. 1825, 72 L.Ed.2d 182 (1982) ("Our cases subsequent to Cort v. Ash have plainly stated that our focus must be on the intent of Congress") (internal quotation omitted); Feins v. American Stock Exchange, Inc., 81 F.3d 1215, 1220 (2d Cir. 1996); Asch v. Philips, Appel & Walden, Inc., 867 F.2d 776, 777 (2d Cir.1989). The factors relevant to determining the intent of Congress when a statute fails to provide for a private right of action are "`the language of the statute itself, its legislative history, the underlying purpose and structure of the statutory scheme, and the likelihood that Congress intended to supersede or to supplement existing state remedies.'" Feins, 81 F.3d at 1220 (quoting, Northwest Airlines, Inc. v. Transport Workers Union of America, 451 U.S. 77, 91, 101 S.Ct. 1571, 67 L.Ed.2d 750 (1981)); see also Baba v. Japan Travel Bureau Intl., 111 F.3d 2, 6 (2d Cir. 1997).
The Court will first undertake the "central inquiry" into Congress' intent. Section 6104(e) was enacted as part of the Omnibus Budget Reconciliation Act of 1987, Pub.L. 100-203. There is no indication in either the language of the statute or the legislative history that the bill drafters intended to create a private remedy for violation of the statute. Indeed, the House Report accompanying the legislation specifically provided for a relatively nominal penalty of $10 per day, and a maximum penalty of *428 $5,000, for violations of the statute. H.R.Conf.Rep. No. 100-495, reprinted in 1987 U.S.Code Cong. & Admin.News at XXXX-XXXX. This penalty provision is codified at 26 U.S.C. § 6652(c)(1)(C).[1] The Code additionally provides for a $5,000 penalty for willful violations of § 6104(e). 26 U.S.C. § 6684. The fact that the Code already contains penalty provisions undermines Schuloff's position that a private right of action also exists since, as the Supreme Court has noted, "`it is an elemental canon of statutory construction that where a statute expressly provides a particular remedy or remedies, a court must be chary of reading others into it.'" Meghrig v. KFC Western, Inc., 516 U.S. 479, 488, 116 S.Ct. 1251, 1256, 134 L.Ed.2d 121 (1996) (quoting Middlesex County Sewerage Auth. v. National Sea Clammers Assn., 453 U.S. 1, 14-15, 101 S.Ct. 2615, 69 L.Ed.2d 435 (1981)) (other internal quotations omitted).
The structure of the Code as a whole also argues against creation of a private right of action. First, because the IRS itself is required to make the annual returns at issue here available for public inspection, see 26 U.S.C. § 6104(b), litigants have means other than private lawsuits for obtaining access to such materials. Second, 26 U.S.C. § 7401 provides that "[n]o civil action for the collection or recovery of taxes, or of any fine, penalty, or forfeiture, shall be commenced unless the Secretary [of the Treasury] authorizes or sanctions the proceedings and the Attorney General or [her] delegate directs that the action be commenced." Courts have held that § 7401 precludes the filing of private lawsuits against third parties based upon their alleged violations of the Code. See Hardin v. DuPont Scandinavia (ARA-JET), 731 F.Supp. 1202, 1204 (S.D.N.Y.1990); United States ex rel. U.S.-Namibia (Southwest Africa) Trade & Cultural Council v. The Africa Fund, 588 F.Supp. 1350, 1351 (S.D.N.Y.1984). The Court agrees. Implying an unrestricted private cause of action under § 6104 would be wholly inconsistent with the enforcement mechanism set forth in § 7401, which invests the executive branch with broad discretion to determine which civil actions should proceed. The Supreme Court has made it clear that when a statute already contains enforcement mechanisms for remedying violations, "`it cannot be assumed that Congress intended to authorize by implication additional judicial remedies for private citizens suing under' the statute." Meghrig, 516 U.S. at 488, 116 S.Ct. at 1256 (quoting Middlesex County Sewerage Auth., 453 U.S. at 14). Indeed, "`the presumption that a remedy was deliberately omitted from a statute is strongest when Congress has enacted a comprehensive legislative scheme including an integrated system of procedures for enforcement.'" Feins, 81 F.3d at 1221 (quoting Northwest Airlines, 451 U.S. at 97).
The remaining Cort v. Ash factors similarly fail to support the creation of a private remedy. In respect to the first factor, Schuloff is not a member of a class for whose special benefit the statute was enacted. Cort, 422 U.S. at 78. The Supreme Court "has been especially reluctant to imply causes of actions under statutes that create duties on the part of persons for the benefit of the public at large." Cannon, 441 U.S. at 693 n. 13. In respect to the third factor, and as set forth more fully above, a private right of action would be inconsistent with the enforcement mechanism contained in the Code.[2] Accordingly, the Court concludes that the language and legislative history of § 6104 and the structure of the Code as a whole compel a determination that there is no private right of action under § 6104. Defendants' motions to dismiss Schuloff's claims under § 6104 are therefore granted.[3]
*429 III. 42 U.S.C. § 1983
The elements of a claim under § 1983 are: (1) that the conduct in question deprived a person of rights, privileges, or immunities secured by the Constitution or laws of the United States; and (2) that the conduct complained of was committed by a person acting under color of state law. See Gomez v. Toledo, 446 U.S. 635, 640, 100 S.Ct. 1920, 64 L.Ed.2d 572 (1980); Adickes v. S.H. Kress & Co., 398 U.S. 144, 150 (1970). Because "[s]ection 1983 is not itself a source of substantive rights,' but merely provides `a method for vindicating federal rights elsewhere conferred[,]' ... [t]he first step in any such claim is to identify the specific ... right allegedly infringed." Albright v. Oliver, 510 U.S. 266, 271, 114 S.Ct. 807, 127 L.Ed.2d 114 (1994) (quoting Baker v. McCollan, 443 U.S. 137, 144 n. 3, 99 S.Ct. 2689, 61 L.Ed.2d 433 (1979)); see also Graham v. Connor, 490 U.S. 386, 393-394, 109 S.Ct. 1865, 104 L.Ed.2d 443 (1989). As the Court has already determined that § 6104 does not create a private right of action, Schuloff cannot look to § 1983 to enforce the provisions of § 6104. See Montauk-Caribbean Airways, Inc. v. Hope, 784 F.2d 91, 97-98 (2d Cir.1986) (holding that comprehensive enforcement scheme set forth in Federal Aviation Act precludes both private right of action in favor of public at large and action under § 1983 to enforce statutory provisions). Schuloff's claims under 42 U.S.C. § 1983 are therefore dismissed.
CONCLUSION
For the foregoing reasons, Schuloff's claims under 26 U.S.C. § 6104 and 42 U.S.C. § 1983 are dismissed. Since federal jurisdiction over these cases rested entirely upon these statutory provisions, the Court declines to exercise supplemental jurisdiction over the remaining state law claims. 28 U.S.C. § 1367(c)(3) (district courts may decline supplemental jurisdiction where "the district court has dismissed all claims over which it has original jurisdiction"); see Choe v. Fordham Univ. School of Law, 81 F.3d 319 (2d Cir.1996). Accordingly, the Court dismisses the complaints in the above-captioned actions in their entirety.
SO ORDERED.
NOTES
[1] In 1996, the statute was amended to increase the penalty to $20 per day, with a maximum penalty of $10,000. Pub.L. 104-88, § 1704(s)(1).
[2] The fourth Cort factor whether recognition of a private remedy would infringe upon state law is not implicated in this case, since administration of federal tax laws is quintessentially a federal matter. In any event, since the statutory language and legislative history do not support the creation of a private right of action, the Court need not undertake the academic exercise of determining whether a private right of action would infringe upon state law.
[3] The Court notes that by order dated February 25, 1997, the Honorable Kimba M. Wood, Federal District Judge in the Southern District of New York, dismissed a virtually identical action entitled Anita Schuloff v. Center for Constitutional Rights (96-CV-6667 (KMW)). Judge Wood also concluded that 26 U.S.C. § 6104 does not provide for a private right of action. Although Schuloff appealed Judge Wood's decision to the Second Circuit, the appeal was dismissed without decision on January 29, 1998.
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989 F.Supp. 265 (1998)
MALLINCKRODT MEDICAL, INC. and Molecular Biosystems, Inc.
v.
SONUS PHARMACEUTICALS, INC., Nycomed Imaging AS, Imarx Pharmaceutical Corp., DuPont Merck Pharmaceutical Co., Bracco Diagnostics, Inc.
Civil Action No. 97-1732(PLF).
United States District Court, District of Columbia.
January 5, 1998.
*266 Christopher Andrew Myers, Holland Knight, Washington, DC, George Brian Busey, Morrison & Foerster, Washington, DC, Gordon William Hatheway, Jr., Reed Smith Shaw & McClay, Washington, DC, for Mallinckrodt Medical, Inc.
George Brian Busey, Morrison & Foerster, Washington, DC, Gordon William Hatheway, Jr., Reed Smith Shaw & McClay, Washington, DC for Molecular Biosystems, Inc.
Sara Needleman Kline, Wilmer Cutler & Pickering, Washington, DC, for Sonus Pharmaceuticals, Inc.
Edward Tuck Colbert, Sr., Kenyon & Kenyon, Washington, DC, for Nycomed Imaging, AS.
Margaret Moran Zwisler, Howrey & Simon, Washington, DC, for ImaRx Pharmaceutical Corp.
Sylvia M. Becker, Kaye Scholer Fierman Hays Handler, Washington, DC, for DuPont Merck Pharmaceuticals Co.
Thomas Douglas Hollowell, Jr., Rogers & Wells, Washington, DC, for Bracco International BV, Bracco Diagnostics Inc.
OPINION
PAUL L. FRIEDMAN, District Judge.
I. BACKGROUND
Bracco Diagnostics, Inc., DuPont Merck Pharmaceutical Co., ImaRx Pharmaceutical Corp. and Sonus Pharmaceuticals, Inc. are all manufacturers of injectable contrast imaging agents for use with diagnostic ultrasound equipment in the diagnosis of cardiac dysfunction. Each product contains a fluorinated gas (perfluoropropane) or a fluorinated chemical encapsulated in a microspheric membrane or microbubble. On April 14, 1997, each of these companies brought a lawsuit in this Court against the Food and Drug Administration alleging that they were being harmed by the FDA's decision to treat their products as drugs for purposes of the FDA approval process, while treating the virtually identical product of a competitor, Molecular Biosystems, Inc. ("MBI"), as a medical device with a simpler, speedier application and approval process. The Court consolidated *267 the three cases. MBI sought leave to intervene, and the Court granted its motion. By Opinion and Order of April 21, 1997, the Court concluded that plaintiffs were likely to succeed on the merits of their claim that the FDA had acted arbitrarily and capriciously by failing to treat similarly situated products in the same fashion. The Court therefore enjoined the FDA from continuing any approval or review procedures with respect to any applications for approval of ultrasound contrast agents until ten days after the FDA resolved the Citizens' Petitions fried by Bracco, DuPont Merck and ImaRx, and Sonus. See Bracco Diagnostics Inc. v. Shalala, 963 F.Supp. 20 (D.D.C.1997).
On July 25, 1997, the Food and Drug Administration provided a consolidated response to the Citizens' Petitions regarding the regulation of ultrasound contrast agents. In that response, the FDA announced that it would treat all ultrasound contrast agents as drugs under the Federal Food, Drug and Cosmetic Act, 21 U.S.C. § 301, et seq., and would assign primary oversight and review responsibility to the Center for Drug Evaluation and Research. On August 1, 1997, having negotiated numerous extensions of time with the other parties, MBI, as defendant-intervenor in the Bracco, DuPont Merck and Sonus lawsuits, filed its consolidated answer to the complaints and asserted counterclaims against Bracco, DuPont Merck and ImaRx, Sonus and two new parties, Nycomed Imaging AS and Bracco's foreign counterpart, Bracco International BV. MBI's counterclaims brought wholly different issues to the table, involving claims under the patent law. The counterclaims generally stemmed from MBI's fear that the counterclaim defendants would sue MBI for infringing their patents (for the use and prospective marketing of its ultrasound contrast agent), which allegedly cover the use of perfluorocarbon gases in ultrasound contrast agents. In its counterclaims, MBI sought declaratory and injunctive relief that would either render the counterclaim defendants' patents invalid and unenforceable or enjoin them from enforcing their patent claims.
By Memorandum Opinion and Order of September 10, 1997, the Court concluded that the three consolidated cases had become moot on July 25, 1997 when the FDA provided its consolidated response to the plaintiffs' Citizen Petitions. Bracco Diagnostics, Inc., et al. v. Food and Drug Administration, et al., Civ. Action Nos. 97-0739, 97-0740, 97-0742, Opinion at 4 (D.D.C. July 25, 1997). Finding that plaintiffs had received all the relief they had sought by that date, the Court concluded that MBI's answer and counterclaim were filed too late: "The case was already moot and there was no live case or controversy before this Court when MBI filed its answer and counterclaim on August 1, 1997." See id. at 5. Because the cases were moot before MBI filed its answers and counterclaims, the Court granted the motions of Sonus, DuPont Merck and ImaRx, and Bracco to strike the counterclaims and dismiss the three cases in their entirety.
Meanwhile, on July 31, 1997, MBI and Mallinckrodt Medical, Inc. (the marketer for MBI's ultrasound contrasting agent) filed a separate complaint, giving birth to this separate action. MBI and Mallinckrodt brought claims against Bracco and Bracco International, DuPont Merck and ImaRx, and Sonus, as well as Nycomed Imaging AS, seeking essentially, the same relief they had sought in their counterclaims in the original FDA lawsuit.
In this case, MBI and Mallinckrodt claim that the FDA is on the verge of approving their ultrasound contrasting agent, Optison. They contend that this otherwise positive development has been frustrated because the defendant companies have, in one way or another, threatened to bring patent infringement actions against them once Optison is approved. In Count One, they seek a declaration that the patents filed by Sonus, Nycomed, ImaRx and DuPont, and Bracco and Bracco International are invalid and unenforceable for failure to comply with the requirements of the patent laws and/or a declaration that the manufacture, use and sale of Optison will not infringe any valid and enforceable patent of any of the defendants.[1]*268 In Count Two, MBI and Mallinckrodt request that, in the event the Court concludes that any one of defendants' patents is valid, the Court determine which defendant holds the patent covering the use of perfluorocarbon gas in ultrasound contrasting agents.[2] Alternatively, MBI and Mallinckrodt seek a declaration and/or injunction requiring defendants to invoke patent interference proceedings in the Patent and Trademark Office or to initiate an interfering patent suit in this case pursuant to 35 U.S.C. § 291 in order to resolve defendants' allegedly conflicting claims of priority of invention. Finally, in Count Three MBI and Mallinckrodt seek compensatory and injunctive relief against Sonus for making false and defamatory statements about (1) the scope of Sonus' patent rights to the use of perfluorocarbon gas in ultrasound contrast agents (2) MBI's alleged infringement of Sonus' patents through its product Optison and (3) the order in which the FDA will approve MBI's and Sonus' ultrasound contrast agents.
On September 2, 1997, Nycomed answered the complaint and brought a counterclaim against MBI and Mallinckrodt. In Count One of its counterclaim, Nycomed seeks a declaratory judgment that MBI and Mallinckrodt have infringed Nycomed's patent, which allegedly covers Optison's use of perfluorocarbon gas. In Count Two, it seeks a declaratory judgment that Nycomed's patent is valid and enforceable against MBI and Mallinckrodt. In Count Three, Nycomed seeks a declaration that MBI is not entitled to a royalty-free license under Nycomed's patent. In addition to its counterclaim against MBI and Mallinckrodt, Nycomed has brought a cross-claim against Sonus seeking a declaration, pursuant to an interfering patent action under 35 U.S.C. § 291, that either Nycomed's patent claims preceded those of Sonus or that Sonus' patent is invalid under one or more provisions of the patent law.
Currently before the Court are a series of motions to dismiss filed by Sonus, Nycomed, Bracco, Bracco International, DuPont Merck and ImaRx, all relating to issues of subject matter and personal jurisdiction under Rules 12(b)(1) and 12(b)(2) of the Federal Rules of Civil Procedure. ImaRx also raises the defense of failure to join an indispensable party under Rule 12(b)(7), Fed.R.Civ.P., and Bracco, Bracco International, DuPont Merck and ImaRx argue that plaintiffs have failed to state a claim under Rule 12(b)(6), Fed. R.Civ.P. The briefing was extensive and the briefs voluminous. The Court heard approximately two-and-one-half hours of argument on December 9, 1997. The Court has carefully considered all the written and oral arguments of the parties and their analysis of each issue presented, as well as the statutory and case authority cited by them. For the reasons that follow, the Court finds that it lacks jurisdiction over most of the claims and most of the parties before it.
II. DISCUSSION
A. Subject Matter Jurisdiction
For this Court to have jurisdiction, there must have been be an actual case or controversy between the parties at the time the action was commenced. In the patent context, an actual controversy exists if the party seeking a declaratory judgment demonstrates either that there is (1) an explicit threat or other action by a patentee that creates a "reasonable apprehension" on the part of the plaintiff that it will face an infringement suit, and (2) present activity that could constitute infringement or "concrete steps taken with the intent to conduct such activity." Cygnus Therapeutics Systems v. ALZA Corp., 92 F.3d 1153, 1158-59 (Fed.Cir. 1996); BP Chemicals Ltd. v. Union Carbide Corp., 4 F.3d 975, 978 (Fed.Cir.1993). Although plaintiffs do not have to prove that they were confronted with an express charge of infringement, "more is required than the existence of an adversely held patent." BP *269 Chemicals Ltd. v. Union Carbide Corp., 4 F.3d at 978. Ultimately, the Court must look to the "totality of circumstances." Shell Oil Co. v. Amoco Corp., 970 F.2d 885, 888 (Fed. Cir.1992).
With respect to Bracco and Bracco international, all that plaintiffs offer in their attempts to establish an actual case or controversy is the existence of the Bracco patents, which they allege cover Optison's use of perfluorocarbon gas, and the fact that Bracco was a party to the action that sought to force the FDA to regulate all ultrasound contrast agents in the same manner. There is no allegation that either Bracco or Bracco International made an explicit threat or engaged in any other activity that could have created a reasonable apprehension of suit on the part of MBI or Mallinckrodt. The fact that the Bracco companies hold patents, which may be infringed by certain of Optison's uses, is not enough. BP Chemicals Ltd. v. Union Carbide Corp., 4 F.3d at 978. Nor is it sufficient that Bracco sued the FDA, and that MBI which was not initially a party to the FDA action sought to intervene and was granted intervenor status. The FDA lawsuit did not involve patent law issues, and there was nothing that transpired in that case that would have given MBI any indication, let alone a reasonable apprehension, that a patent action would be instituted by Bracco or Bracco International. See Indium Corp. of America v. Semi-Alloys, Inc., 781 F.2d 879, 883 (Fed.Cir.1985), cert. denied, 479 U.S. 820, 107 S.Ct. 84, 93 L.Ed.2d 37 (1986); cf. CAE Screenplates, Inc. v. Beloit Corp., 957 F.Supp. 784, 792 (E.D.Va.1997).
The same is true with respect to DuPont Merck and ImaRx. The only extra claim that plaintiffs have regarding their reasonable apprehension of an infringement action by DuPont Merck and ImaRx is the fact that Evan Unger, the President and Chief Executive Officer of ImaTRx, wrote a letter to Dina Gardner of MBI on July 25, 1996 in which Mr. Unger stated:
Enclosed for your information is a copy of one of our recently issued patents, U.S. Patent No. 5,527,521 entitled "Low Density Microspheres and Suspensions and Their use as Contrast Agents for Computed Tomography and In Other Applications." This patent is directed to, among other things, perfluorocarbon gas-filled microspheres useful in diagnostics imaging (see, for example, claim 20), and represents the latest of a number of patents issued to ImaRx in the diagnostic field.
DuPont Merck and ImaRx Motion to Dismiss, Ex. E; Declaration of Thomas A. Fritz at ¶ 35. Plaintiffs admit that this letter alone could not create a reasonable apprehension of a patent infringement action by DuPont Merck and ImaRx, but they contend that the letter in combination with the FDA litigation warrant such an apprehension. The Court disagrees.
As the Court has already concluded with respect to Bracco, the fact that DuPont Merck and ImaRx were plaintiffs in the FDA litigation could have created no reasonable apprehension of an infringement action; the innocuous letter that MBI and Mallinckrodt now point to adds nothing to the equation. The language of the letter is not a threat, express or implied; it has no threatening language or threatening qualities to it; and it could not by any stretch of the imagination create a reasonable apprehension that MBI and Mallinckrodt would face an infringement suit by DuPont Merck or ImaRx. See Phillips Plastics Corp. v. Kato Hatsujou Kabushiki Kaisha, 57 F.3d 1051, 1052 (Fed.Cir. 1995); Shell Oil Co. v. Amoco, 970 F.2d at 888; Indium Corp. of America v. Semi-Alloys, Inc., 781 F.2d at 883.[3]
*270 Plaintiffs fare no better with respect to their interpleader argument under Rule 22 of the Federal Rules of Civil Procedure. The notion that the procedural device of interpleader can be used as a hook to give the Court subject matter jurisdiction to order the patent-owning defendants to initiate an interfering patents action under 35 U.S.C. § 291 is not only novel but far-fetched. See Commercial Union Insurance Co. v. United States, 999 F.2d 581, 584 (D.C.Cir.1993). "Rule 22 ... `is merely a procedure device; it confers no jurisdiction in the federal courts....' Thus, an interpleader brought under Rule 22 must fall within one of the general statutory grants of federal jurisdiction." Id. (internal citation omitted). Neither 35 U.S.C. § 291 itself nor any other statute grants this Court subject matter jurisdiction over this claim.
First, there simply is no statute that provides this Court with jurisdiction to force the parties either to go to the Patent and Trademark Office to institute an interference proceeding or to pursue one in this Court. See In re Continental General Tire, Inc., 81 F.3d 1089, 1091-92 (Fed.Cir.1996). Second, Section 291 is plain on its face: "The owner of an interfering patent may have relief against the owner of another by civil action and the court may adjudge the question of the validity of any of the interfering patents, in whole or in part." 35 U.S.C. § 291 (emphasis added). Neither MBI nor Mallinckrodt is the owner of an interfering patent and, thus, even if Rule 22 provided subject matter jurisdiction (which it does not) Section 291 is simply unavailable to companies like MBI and Mallinckrodt who are not owners of an interfering patent. See Albert v. Kevex Corp., 729 F.2d 757, 760-61 (Fed.Cir.), rehearing denied, 741 F.2d 396, 399 (Fed.Cir. 1984); Regents of the University of California v. Eli Lilly & Co., 777 F.Supp. 779, 783-84 (N.D.Cal.1991). Plaintiffs may not use Rule 22 interpleader to force a patent interference action and thus circumvent Section 291's limited grant of standing. With respect to this issue, the Court fully embraces the discussion and analysis of Judge Jensen in Advanced Cardiovascular Systems, Inc. v. Medtronic. Inc., No. C-95-3577 DLJ, 1996 WL 467293, at *7-*8 (N.D.Cal. July 24, 1996).
For these reasons, the Court concludes that there is no actual case or controversy between MBI/Mallinckrodt and Bracco/Bracco International or DuPont Merck/ImaRx. The Court therefore lacks subject matter jurisdiction and must grant the motions of Bracco and Bracco International and DuPont Merck and ImaRx to dismiss all the claims against them brought by MBI and Mallinckrodt under Rule 12(b)(1) of the Federal Rules of Civil Procedure.
B. Personal Jurisdiction
Sonus and ImaRx argue that this Court lacks personal jurisdiction over them because they have had no contacts with the District of Columbia other than (a) having petitioned the FDA with respect to the approval of applications for their ultrasound products and having protested to the FDA the disparate treatment their products were receiving, and (b) having filed a lawsuit in this Court against the FDA to vindicate their rights under the APA when they received no relief from the agency. Plaintiffs maintain that filing the FDA lawsuit is a sufficient basis for personal jurisdiction in and of itself and, furthermore, that by bringing suit here Sonus and ImaRx impliedly consented to the jurisdiction of this Court. In addition, plaintiffs maintain there is jurisdiction over Sonus in the District of Columbia because Sonus published a defamatory statement on America On Line accusing MBI of patent infringement that was available to AOL subscribers in the District of Columbia.
The District of Columbia long-arm statute permits the courts of this jurisdiction to exercise personal jurisdiction over a person who acts, either directly or through an agent, "as to a claim for relief arising from the person's transacting any business in the District of Columbia." D.C.Code § 13-423(a)(1). When jurisdiction is based on this subsection (the "transacting business" subsection) of the long-arm statute, "only a claim for relief arising from acts enumerated in [the long-arm statute itself] may be asserted against [that person]." D.C.Code § 13-423(b). In relying on the "transacting business" subsection of the long-arm statute one must meet both the requirements of subsection *271 (a)(1) and subsection (b). See Crane v. Carr, 814 F.2d 758, 763 (D.C.Cir.1987); Novak-Canzeri v. Saud, 864 F.Supp. 203, 206 (D.D.C.1994).
The Court rejects plaintiffs' implied consent argument. It is true that Sonus and ImaRx chose this forum in which to bring a lawsuit against the FDA. They did not, however, choose this forum to litigate a patent case. Nor did they ever sue MBI here. Once the FDA lawsuit was dismissed, Sonus and ImaRx had no expectation of being haled into court in the District of Columbia by a company they did not sue in the FDA case who, on its own initiative, had intervened in that case prior to its termination. It would be ludicrous to suggest that Sonus and ImaRx consented to the jurisdiction of this Court for all time, with respect to all potential competitors, and for all purposes, simply because they once chose to sue the FDA here. The fact that MBI intervened in the FDA lawsuit makes the proposition no less palatable. The FDA lawsuit is over and done with, and the subject matter of that suit relating solely to the administrative actions of the FDA had nothing to do with patents or patent infringement. The initiation of that action neither implies consent to be sued, nor does it "in and of itself constitute doing business in the jurisdiction where the suit [was] brought." Payton v. Summit Loans, Inc., 253 A.2d 459, 461 (D.C.1969).
In addition, because the District of Columbia is the Nation's capital and because it is important that all citizens from all parts of the country have unfettered access to petition their government, the courts of this jurisdiction have long recognized "a government contacts" exception to the "transacting business" provision of the long-arm statute. Under that exception, a person or company does not subject itself to the jurisdiction of the courts of the District of Columbia merely by filing an application with a government agency, like the FDA, or by seeking redress of grievances from the Executive Branch or Congress. Naartex Consulting Corp. v. Watt, 722 F.2d 779, 787 (D.C.Cir.1983), cert. denied, 467 U.S. 1210, 104 S.Ct. 2399, 81 L.Ed.2d 355 (1984); Freiman v. Lazur, 925 F.Supp. 14, 24 (D.D.C.1996); Environmental Research Int'l., Inc. v. Lockwood Greene Engineers, Inc., 355 A.2d 808, 813 (D.C.1976) (en banc). "The District of Columbia's unique character as the home of the federal government requires this exception in order to maintain unobstructed access to the instrumentalities of the federal government." Cellutech, Inc. v. Centennial Cellular Corp., 871 F.Supp. 46, 50 (D.D.C.1994).
Furthermore, under the government contacts exception, a person or entity that has unsuccessfully petitioned the Executive Branch, an independent agency or Congress and then seeks redress before the federal or local courts in the District of Columbia is not thereby "transacting business" for purposes of the long-arm statute. When instituting suit for that purpose, it continues to be protected by the government contacts exception. Naartex Consulting Corp. v. Watt, 722 F.2d at 787 (citing Doe v. McMillan, 566 F.2d 713, 718 (D.C.Cir.1977)); see Lex Tex Ltd. v. Skillman, 579 A.2d at 248 n. 9; cf. Investment Company Institute v. United States, 550 F.Supp. 1213, 1217 (D.D.C.1982). Accordingly, the fact that Sonus and ImaRx sued the FDA in this jurisdiction does not subject them to jurisdiction for purposes of this patent litigation under the transacting business subsection of the long-arm statute.
Moreover, even if there were some theory under which bringing the FDA litigation could be construed as "transacting business" in the District of Columbia, to establish personal jurisdiction under subsection (a)(1) of the long-arm statute, the plaintiffs' claim itself must have arisen from the business transacted in the District of Columbia. D.C.Code § 13-423(b). See Dooley v. United Technologies Corp., 786 F.Supp. 65, 71 (D.D.C.1992). As this Court held in Cellutech, Inc. v. Centennial Cellular Corp., 871 F.Supp. at 48:
To establish personal jurisdiction under the "transacting business" clause of the long-arm statute, plaintiff must prove that (1) the defendant transacted business in the District, (2) the claim arose from the business transacted in the District, and (3) the defendant had minimum contacts with the District such that the Court's exercise *272 of personal jurisdiction would not offend "traditional notions of fair play and substantial justice."
The asserted patent infringement at issue here did not arise from the wholly separate regulatory litigation against the FDA in which MBI chose to intervene.[4]
With respect to Sonus, plaintiffs have another arrow in their quiver. In addition to having brought suit against the FDA in the District of Columbia, Sonus also sent a message from Seattle to Virginia over America On Line, a private subscriber service, which has been posted on AOL's electronic bulletin boards. The posting allegedly includes the following language:
The commercialization of FS-069 [Optison] in the United States would infringe one or more patents owned by Sonus Pharmaceuticals, Inc. and Sonus would take such willful infringement very seriously.
Complaint at ¶ 94. Plaintiffs argue that approximately 200,000 District of Columbia residents are subscribers to AOL and that they may have access to the posting. According to plaintiffs, Sonus therefore is and has been transacting business in the District of Columbia for purposes of subsection (a)(1) the long-arm statute. This posting, plaintiffs argue, when combined with Sonus' institution of a lawsuit against the FDA here, creates sufficient contacts between Sonus and the District of Columbia to satisfy both the long-arm statute and minimum contacts under the due process clause.
In addition, plaintiffs argue that the transmission of the AOL message, which they claim was defamatory, provides jurisdiction under subsection (a)(4) of the long-arm statute. That subsection provides personal jurisdiction over a person who "caus[es tortious injury in the District of Columbia by an act or omission outside the District of Columbia if he regularly ... engages in any ... persistent course of conduct ... in the District of Columbia." D.C.Code § 13-423(a)(4). The Court rejects both of these arguments.
The AOL transmission from Seattle to Virginia, which was subsequently posted on an AOL electronic bulletin board and may have been accessed by AOL subscribers in the District of Columbia, cannot be construed as "transacting business" in the District of Columbia. The message was not sent to or from the District of Columbia, the subject matter of the message had nothing to do with the District of Columbia, and neither plaintiffs nor Sonus reside in, have their headquarters in or are incorporated in the District. Other than the fact that some people may have visited the electronic bulletin board and read the message from here, the AOL posting has no connection to this jurisdiction. The act of posting a message on an AOL electronic bulletin board which certain AOL subscribers may or may not choose to access, according to each individual's tastes and interests is not an act purposefully or foreseeably aimed at the District of Columbia. Therefore, it does not separately, or in combination with the FDA lawsuit constitute transacting within the District of Columbia for purposes of the long-arm statute. Compare Cybersell, Inc. v. Cybersell, Inc., 130 F.3d *273 414, 419-20 (9th Cir.1997) (to be reported at 130 F.3d 414) (essentially passive nature of posting home page on World Wide Web does not qualify as purposeful activity invoking benefits and protection of the home forum), and Bensusan Restaurant Corp. v. King, 937 F.Supp. 295, 301 (S.D.N.Y.1996) (passive Web site doing little more than making information available to those having interest is not grounds for personal jurisdiction), aff'd, 126 F.3d 25 (2d Cir.1997), with Zippo Manufacturing Co. v. Zippo Dot Com, Inc., 952 F.Supp. 1119, 1125-27 (W.D.Pa.1997) (defendant contracting via Internet with individuals and Internet access providers subjects it to personal jurisdiction in state in which those individuals and providers reside), and CompuServe, Inc. v. Patterson, 89 F.3d 1257, 1261-68 (6th Cir.1996) (individual who purposefully contracted and directly communicated via Internet with computer network service provider is subject to personal jurisdiction in the service provider's home state).
Plaintiffs fare no better under subsection (a)(4) of the long-arm statute. While the transmission of the message occurred from outside the District of Columbia, there is no indication that plaintiffs themselves suffered any injury in the District of Columbia that they could not have suffered or did not suffer in any state in the nation where someone may have read the message and reacted negatively towards plaintiffs. There is no nationwide jurisdiction for defamation actions, see McFarlane v. Esquire Magazine, 74 F.3d 1296, 1300 (D.C.Cir.), cert. denied, ___ U.S. ___, 117 S.Ct. 53, 136 L.Ed.2d 16 (1996), and the advent of the Internet and Internet service providers such as AOL does not change that fact. See Graphic Controls Corp. v. Utah Medical Products, Inc., No. 96-CV-0459E(F), 1997 WL 276232, at *3 (W.D.N.Y. May 21, 1997); IDS Life Ins. Co. v. SunAmerica, Inc., 958 F.Supp. 1258, 1268 (N.D.Ill.1997). Most importantly, even if plaintiffs suffered injury in the District of Columbia, they have not demonstrated that Sonus regularly does or solicits business here or engages in "any other persistent course of conduct in the District of Columbia." D.C.Code § 13-423(a)(4) (emphasis added). See Tavoulareas v. Comnas, 720 F.2d 192, 194 (D.C.Cir.1983); McFarlane v. Esquire Magazine, 74 F.3d at 1301. They therefore fail to meet the requisites of D.C.Code § 13-423(a)(4), and there is no personal jurisdiction over Sonus with respect to any of the claims brought against it.
C. Nycomed
Finally, with respect to Nycomed's cross-claims against Sonus, Nycomed concedes that if the Court has no personal jurisdiction over Sonus with respect to the main claim, it has no jurisdiction to resolve the cross-claim brought by Nycomed against Sonus. While there was originally some dispute between Nycomed and Sonus as to whether the Court should dismiss or transfer the cross-claims if it found no personal jurisdiction over Sonus, the Court was advised at oral argument that Nycomed and Sonus now agree that if the Court finds no personal jurisdiction over Sonus, then the proper course is for the Court to dismiss the Nycomed cross-claims against Sonus without prejudice. In light of this agreement and the Court's decision that it lacks personal jurisdiction over Sonus, Nycomed's cross claims against Sonus will be dismissed.
III. CONCLUSION
Having concluded that the Court lacks subject matter jurisdiction over Bracco, DuPont Merck and ImaRx, and that it lacks personal jurisdiction over Sonus and ImaRx, the proper course is for the Court to dismiss Sonus, Bracco, Bracco International BV, DuPont Merck and ImaRx from this case. It also dismisses the cross-claims brought by Nycomed against Sonus. For the reasons set forth herein, therefore, all that remains of this lawsuit are claims brought by Mallinckrodt and MBI against Nycomed and Nycomed's counterclaims against MBI and Mallinckrodt. An Order consistent with this Opinion is entered this same day.
ORDER
For the reasons set forth in the accompanying Opinion entered this same day, it is hereby
ORDERED that Sonus' motion to dismiss [# 56] is GRANTED; it is
*274 FURTHER ORDERED that joint motion to dismiss filed by Bracco Diagnostics, Inc. and Bracco International BV [# 49] is GRANTED; it is
FURTHER ORDERED that the joint motion to dismiss filed by defendants DuPont Merck and ImaRx [# 50] is GRANTED; it is
FURTHER ORDERED that Sonus' motion to dismiss Nycomed's cross-claim [# 57] is GRANTED; it is
FURTHER ORDERED that the motion for leave to file under seal filed by DuPont Merck and ImaRx [# 93] is DENIED;
FURTHER ORDERED that a status conference for the remaining parties to this case, Molecular Biosystems, Inc., Mallinckrodt Medical, Inc. and Nycomed imaging AS, is scheduled for January 27, 1998 at 2:00 p.m..
NOTES
[1] MBI and Mallinckrodt generally contend that defendants' patents are invalid because they claim patent rights to a use that has been obvious to the scientific community for many years the use of perfluorocarbon gas in ultrasound contrast agents.
[2] MBI and Mallinckrodt maintain that all of defendants' patents purport to cover the same exact use of perfluorocarbon gas in ultrasound contrast agents. To the extent that this use can be patented, MBI and Mallinckrodt claim that no more than one person or company can hold a patent covering the use. For this reason, they also claim that defendants' patents interfere with each other.
[3] To the extent that plaintiff finds some meager support for its position in the suggestion of a district court in Louisiana that a refusal to disclaim an intention to bring a patent infringement suit in the future is enough to create a "reasonable apprehension" and thus an actual case or controversy, see Ryko Manufacturing Co. v. Delta Services and Equipment Corp., 28 U.S.P.Q.2d 1558, 1560 n. 1 (E.D.La.1993), such a requirement runs contrary to Federal Circuit precedent. "Although a patentee's refusal to give assurances that it will not enforce its patent is relevant to the determination [regarding reasonable apprehension of suit], ... this factor is not dispositive." BP Chemicals Ltd. v. Union Carbide Corp., 4 F.3d at 980 (internal citation omitted); see Shell Oil Co. v. Amoco Corp., 970 F.2d at 888-89; see also CAE Screenplates, Inc. v. Beloit Corp., 957 F.Supp. at 791.
[4] ImaRx admits to having limited contacts with the District for purposes of conducting clinical tests of its own ultrasound contrasting agent, DMR-115. The clinical tests were performed at Georgetown University Medical Center, located in the District of Columbia, and future clinical testing will also be conducted there. The Court concludes that these clinical tests are irrelevant to its personal jurisdiction analysis here because plaintiffs' patent law claims could not reasonably be viewed as having arisen from those clinical tests.
ImaRx argues that if it is dismissed for lack of personal jurisdiction, the claims of DuPont Merck also must be dismissed, because ImaRx, as the owner of the patents at issue, is an indispensable party under Rule 19 of the Federal Rules of Civil Procedure. A patent owner who has given a license to another (as ImaRx has with respect to DuPont Merck), but has retained substantial rights in the patent, is an indispensable party in an action regarding validity or infringement of the patent. See Abbott Laboratories v. Diamedix Corp., 47 F.3d 1128, 1132-33 (Fed.Cir.1995); Procter & Gamble Co. v. Paragon Trade Brands, Inc., 917 F.Supp. 305, 308 n. 3 (D.Del.195); Suprex Corp. v. Lee Scientific, Inc., 660 F.Supp. 89, 93-94 (W.D.Pa.1987). ImaRx maintains that it has retained such substantial rights under its patent. Plaintiffs contend that they should be allowed discovery in order to fully explore this issue. Because the claims against DuPont Merck must be dismissed for lack of subject matter jurisdiction, see supra at 269-270, the Court finds no need to resolve this factually-based issue.
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United States Court of Appeals
For the Eighth Circuit
___________________________
No. 17-2386
___________________________
United States of America
lllllllllllllllllllllPlaintiff - Appellee
v.
Elio Cruz Rodriguez
lllllllllllllllllllllDefendant - Appellant
____________
Appeal from United States District Court
for the Eastern District of Arkansas - Little Rock
____________
Submitted: September 25, 2018
Filed: December 11, 2018
[Unpublished]
____________
Before LOKEN, BENTON, and SHEPHERD, Circuit Judges.
____________
PER CURIAM.
Elio Rodriguez pled guilty to aiding and abetting the possession of more than
500 grams of methamphetamine with intent to distribute, in violation of 21 U.S.C.
§ 841(a)(1), (b)(1)(A)(viii), and 18 U.S.C. § 2. Rodriguez objected to the pre-
sentence investigation report, seeking a three-level reduction in his base offense level
for a mitigating role. See United States Sentencing Commission, Guidelines Manual,
§ 3B1.2. The district court1 overruled his objection and imposed a sentence of 168
months imprisonment followed by five years of supervised release. Rodriguez argues
the district court committed procedural error in denying him a mitigating-role
reduction; failing to adequately explain why it denied his request for a mitigating-role
reduction; and failing to evaluate all of the factors outlined in § 3B1.2 of the
Sentencing Guidelines. We affirm.
I.
“In reviewing the district court’s sentence, ‘[w]e must first ensure that the
district court committed no significant procedural error.’” United States v.
Salazar-Aleman, 741 F.3d 878, 880 (8th Cir. 2013) (alteration in original) (quoting
United States v. Feemster, 572 F.3d 455, 461 (8th Cir. 2009) (en banc) (internal
quotation marks omitted)).2 “A district court must ‘adequately explain the chosen
sentence to allow for meaningful appellate review and to promote the perception of
fair sentencing.’” United States v. Durham, 836 F.3d 903, 910 (8th Cir. 2016)
(quoting Feemster, 572 F.3d at 461). “The district court’s . . . denial of a mitigating
role reduction is a factual finding reviewed for clear error.” Salazar-Aleman, 741
F.3d at 880 (citing United States v. Ellis, 890 F.2d 1040, 1041 (8th Cir. 1989) (per
curiam)). Although we review the district court’s factual findings for clear error, we
review “its application of the guidelines to those facts de novo.” United States v.
Castillo, 713 F.3d 407, 411 (8th Cir. 2013) (citing United States v. Aleman, 548 F.3d
1158, 1163 (8th Cir. 2008)).
A reduction under § 3B1.2 is available “where the defendant’s role ‘makes him
substantially less culpable than the average participant in the criminal activity.’”
1
The Honorable D.P. Marshall Jr., United States District Judge for the Eastern
District of Arkansas.
2
Rodriguez does not argue his sentence is substantively unreasonable.
-2-
United States v. Sharkey, 895 F.3d 1077, 1081 (8th Cir. 2018) (per curiam) (quoting
USSG § 3B1.2, comment. (n.3(A))). The reduction “is intended to cover defendants
who are plainly among the least culpable of those involved in the conduct of a
group.” United States v. Cartagena, 856 F.3d 1193, 1196 (8th Cir. 2017) (quoting
USSG § 3B1.2, comment. (n.4)). In determining whether to grant a mitigating-role
reduction, a district court should consider:
(i) the degree to which the defendant understood the scope and structure
of the criminal activity; (ii) the degree to which the defendant
participated in planning or organizing the criminal activity; (iii) the
degree to which the defendant exercised decision-making authority or
influenced the exercise of decision-making authority; (iv) the nature and
extent of the defendant’s participation in the commission of the criminal
activity, including the acts the defendant performed and the
responsibility and discretion the defendant had in performing those
acts; and (v) the degree to which the defendant stood to benefit from the
criminal activity.
USSG § 3B1.2, comment. (n.3(C)). This inquiry is “heavily dependent upon the facts
of the particular case.” Id. To be sure, “[a] defendant who is concededly less culpable
than his codefendants is not entitled to the minor participant reduction if that
defendant was ‘deeply involved’ in the criminal acts.” United States v. Thompson,
60 F.3d 514, 518 (8th Cir. 1995) (quoting United States v. West, 942 F.2d 528, 531
(8th Cir. 1991)); see also Cartagena, 856 F.3d at 1197.
II.
Rodriguez “bears the burden of proving that he is entitled to th[e] reduction.”
Salazar-Aleman, 741 F.3d at 880 (citing United States v. Chatman, 119 F.3d 1335,
1341 (8th Cir. 1997)). Rodriguez argues he should have been given the reduction
-3-
because he was only involved in the offense to satisfy a drug debt, he was acting on
behalf of others, he had no decision-making authority, and he was not paid to commit
the offense.
In response to Rodriguez’s initial request for a three-level reduction to the base
offense level, the probation officer explained that a reduction would be inappropriate
given that Rodriguez “was the primary actor in arranging the sale, mailing, and
transport[ation] of [the] methamphetamine . . . .” Add. to Pre-Sent. Investig. Report.
At sentencing, Rodriguez’s counsel argued that Rodriguez should receive a role
reduction because he did not “exercise any decision-making authority, nor did he
financially profit from the crime itself.” Sent. Tr. 7, ECF No. 51. Rodriguez also
testified. The district court denied Rodriguez’s request for a reduction and adopted
the probation officer’s reasoning. The district court stated it would “take the role
issue into account as mitigation [towards the sentence].” Sent. Tr. 6. The district
court understood Rodriguez had been acting at the direction of others but concluded
that this fact was “properly and better taken into account as a matter of mitigation
given that [he] was not just a courier . . . .” Sent. Tr. 10. The district court concluded
that Rodriguez was “just doing too much under the factors that [it was] supposed to
consider in 3B1.[2].” Sent. Tr. 10-11.
Based on the record before us, Rodriguez failed to meet his burden, and the
district court’s denial of a mitigating-role reduction was not clear error. See Durham,
836 F.3d at 910 (affirming the district court’s denial of a mitigating-role reduction
because “[t]he court’s adoption of and clear references to the Probation Office’s
reasoning in the PSI Addendum provided adequate explanation for its denial of [the
defendant]’s objection”). It is clear from the sentencing transcript that the district
court considered the § 3B1.2 factors, even if it did not expressly address each one on
the record. See United States v. Torres-Hernandez, 843 F.3d 203, 209 (5th Cir. 2016)
(noting that a district court is “not required to expressly weigh each factor in § 3B1.2
on the record”).
-4-
Further, an application of the factors weighs against granting Rodriguez the
reduction. First, a confidential source reported knowing Rodriguez for several years
and that Rodriguez had been involved in drug trafficking for the duration of that time.
Pre-Sent. Investig. Report 3. Indeed, Rodriguez admitted that on one occasion he
dealt 100 pounds of marijuana. Pre-Sent. Investig. Report 4. Second, during
recorded phone conversations where he organized the transactions, Rodriguez told
the confidential source that he could get a kilogram of methamphetamine from two
locations in Texas. Pre-Sent. Investig. Report 3. The confidential source reported
that Rodriguez was connected to major suppliers of methamphetamine. Pre-Sent.
Investig. Report 3. Third, Rodriguez brokered the transactions, mailed a package
containing methamphetamine, and transported the drugs by bus to Arkansas. Pre-
Sent. Investig. Report 3-4. Finally, although he was not paid to commit the offense,
successful delivery of the drugs would have satisfied a drug debt. Pre-Sent. Investig.
Report 4. Rodriguez did not object to any of these facts. Sent. Tr. 7.
Rodriguez further argues that it is unclear whether the district court compared
his role in the offense to that of other participants, which warrants remand. He cites
United States v. Diaz-Rios, 706 F.3d 795 (7th Cir. 2013), in support thereof. Diaz-
Rios is readily distinguishable for at least three reasons. First, there the government
conceded that the district court did not adequately explain its ruling, and the court’s
independent review confirmed as much. Id. at 795. Second, there it was “unclear
from the record whether the probation officer addressed [the defendant’s objection
to the absence of a reduction] before sentencing.” Id. at 797. Finally, there, pursuant
to circuit-specific case law, the court recognized that “[w]here the reasons for a ruling
under § 3B1.2 are ambiguous, [it has] no choice but to remand for a more complete
explanation.” Id. at 799. None of these characteristics in Diaz-Rios are present here.
Rodriguez also argues that, to the extent the district court compared his level
of culpability to that of his co-defendant, it did so erroneously because the
government dismissed his co-defendant from the case after sentencing and, therefore,
-5-
the co-defendant was not a “participant” as defined in the Sentencing Guidelines. See
USSG § 3B1.2, comment. (n.1). But a participant “is a person who is criminally
responsible for the commission of the offense, [and] need not have been convicted.”
Id. § 3B1.1, comment. (n.1). The government asserts that Rodriguez’s former co-
defendant was present during the transportation of drugs from one location to another,
and a cooler containing the methamphetamine was tagged in his name; thus, the mere
fact that the government dismissed the indictment against the co-defendant is of no
consequence.
III.
We find no error in the district court’s application of the Sentencing
Guidelines, and we conclude that the district court did not clearly err in denying a
mitigating-role reduction in this case. Accordingly, we affirm.
______________________________
-6-
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732 N.W.2d 864 (2007)
2003 WI App 138
STATE
v.
MILLER.
No. 2006AP2080-CR.
Court of Appeals of Wisconsin.
April 10, 2007.
Unpublished opinion. Affirmed.
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661 So.2d 285 (1995)
Robert David DOMBERG, Petitioner,
v.
STATE of Florida, Respondent.
No. 83954.
Supreme Court of Florida.
July 20, 1995.
Rehearing Denied October 12, 1995.
Bradley R. Stark, Miami, for petitioner.
Robert A. Butterworth, Atty. Gen., James W. Rogers, Sr. Asst. Atty. Gen., and Giselle Lylen Rivera, Asst. Atty. Gen., Tallahassee, for respondent.
OVERTON, Justice.
We have for review Domberg v. State, 636 So.2d 527 (Fla. 1st DCA 1994) (Domberg II), based on express conflict with Smith v. State, 598 So.2d 1063 (Fla. 1992),[1] and Barbera v. *286 State, 505 So.2d 413 (Fla. 1987).[2] We have jurisdiction. Art. V, § 3(b)(3), Fla. Const. For the reasons expressed, we approve in part and disapprove in part the district court's opinion in Domberg II, but we approve the court's decision because the result reached is correct.
The facts of this case are as follows. In 1984, Robert David Domberg, Jr., was convicted of kidnapping, conspiracy to commit murder, and a violation of the RICO Act. The sentences he received for those convictions exceeded the sentences recommended by the sentencing guidelines. The trial judge filed written reasons for the departure sentences, which were dated after the sentences were imposed but before a notice of appeal was filed. The written reasons, however, were not filed with the clerk of the court until after Domberg filed a notice of appeal.
Domberg's appeal was concluded in 1988. In that appeal, the First District Court of Appeal addressed a number of issues, including an issue dealing with the departure sentence. The district court characterized that issue by stating: "The court imposed sentences which exceed the recommended guidelines range, providing written reasons for this departure." Domberg v. State, 518 So.2d 1360, 1362 (Fla. 1st DCA), review denied, 529 So.2d 693 (Fla. 1988) (Domberg I). The district court then affirmed the sentences, concluding that, although some of the written reasons were not sufficient to support the departure sentences, others were sufficient. The district court did not address any issue regarding the trial judge's failure to file the written reasons contemporaneously with sentencing.
In 1992, Domberg filed a petition for a writ of habeas corpus in the district court asserting that: (1) the written reasons for the departure sentence were void because the trial judge lacked jurisdiction to file them after the notice of appeal was filed; and (2) Domberg's counsel was ineffective for failing to raise this issue on appeal. See Domberg II. In reviewing those issues, the district court first determined that the trial judge had erred in failing to file the written reasons until after the notice of appeal was filed. The district court found, however, that Domberg's counsel was not ineffective for failing to raise the issue on appeal because, in 1984, when Domberg was sentenced, this area of the law was unsettled. The district court went on to state that a further basis for rejecting Domberg's claim of ineffective assistance of appellate counsel was that the departure was justified, given that the State filed grounds for a departure sentence and those grounds were implicitly adopted by the trial judge at the time of sentencing. For that reason, the district court concluded that the order providing written reasons was redundant, and it rejected Domberg's habeas petition. The district court also noted that, even though it had not addressed in Domberg I the trial judge's failure to file written findings contemporaneously with sentencing, Domberg's counsel had in fact raised that issue in Domberg I.
Domberg contends that the trial judge's failure to file written reasons for departure contemporaneously with sentencing renders his sentences illegal and constitutes fundamental error that can be raised at any time. He also asserts that the district court erred in: (1) finding that his counsel was not ineffective; (2) failing to apply the law as it existed at the time of his initial appeal in this case; and (3) finding that the departure sentences were justified given that the trial judge implicitly adopted the State's grounds for that departure.
We recently determined that the failure to file written reasons for a departure sentence contemporaneously with sentencing does not constitute fundamental error. Davis v. State, No. 84,155, ___ So.2d ___ (Fla. July 20, 1995). Consequently, we reject Domberg's contention to the contrary.
We likewise reject Domberg's claim that his counsel was ineffective for failing to raise the jurisdictional argument on appeal. As properly noted by the district court, a trial judge is without jurisdiction to file written reasons for departure once a notice of appeal has been filed from a properly rendered *287 judgment. Wright v. State, 617 So.2d 837 (Fla. 4th DCA 1993); Davis v. State, 606 So.2d 470 (Fla. 1st DCA 1992). As such, the trial court did err in failing to properly render and file written reasons for its departure. It is important to emphasize, however, that at the time of Domberg's initial appeal, this area of the law was very unsettled. In fact, under the law at that time, had the district court addressed this issue, it would have remanded the case for resentencing and the trial court could have simply entered its previously late-filed written reasons for departure and resentenced Domberg to his initial sentences. See, e.g., Barbera v. State, 505 So.2d 413 (Fla. 1987), receded from by Pope v. State, 561 So.2d 554 (Fla. 1990); Hernandez v. State, 501 So.2d 163 (Fla. 3d DCA 1987). Not until we rendered our decision in Pope v. State, 561 So.2d 554 (Fla. 1990), did we determine that, on remand from a guidelines departure error, resentencing must be within the guidelines. Pope was issued two years after the conclusion of Domberg I. Consequently, under the circumstances of this case, it is not probable that the jurisdictional issue would have changed the outcome of Domberg's sentence on remand even had it been raised by counsel on appeal. Further, Domberg's counsel did raise the related issue of whether the failure to contemporaneously file the written reasons was error.
The test for determining ineffective assistance of appellate counsel is two-fold. First, the assistance of counsel must have been so erroneous or deficient that it fell outside the range of professionally acceptable performance. Second, the error or deficiency in the appellate process must have been so egregious that it undermined confidence in the correctness of the result. Suarez v. Dugger, 527 So.2d 190, 192-93 (Fla. 1988). In other words, for Domberg's counsel to be considered ineffective, there must be a reasonable probability that, but for counsel's ineffective assistance, the outcome of Domberg's sentencing would have been different. Strickland v. Washington, 466 U.S. 668, 104 S.Ct. 2052, 80 L.Ed.2d 674 (1984). Under the state of the law at the time of Domberg's initial appeal, we find that Domberg's counsel was not ineffective for failing to raise this issue on appeal.
Nevertheless, we agree that the district court erred in holding (1) that the law to be applied was that which was in effect at the time of sentencing and (2) that the filing of the order was redundant given that the State's grounds for departure were implicitly adopted by the trial judge at the time of sentencing. As to the first error, the law to be applied in this case is the law that was in effect at the time of the appeal, not the time of sentencing. Smith v. State, 598 So.2d 1063 (Fla. 1992), limited by Wuornos v. State, 644 So.2d 1000, 1008 n. 4 (Fla. 1994) (Smith read to mean that new points of law established by this Court shall be deemed retrospective with respect to all non-final cases unless this Court says otherwise), cert. denied, ___ U.S. ___, 115 S.Ct. 1705, 131 L.Ed.2d 566 (1995); State v. Jones, 485 So.2d 1283 (Fla. 1986). We find, however, that this error does not affect the result in this case because our decision in Pope was not rendered until two years after Domberg's appeal was finalized. Regarding the second issue, a trial judge cannot implicitly adopt the State's grounds for a departure sentence. Barbera v. State, 505 So.2d 413 (Fla. 1987) (formulation of reasons for departure is exclusive function of judiciary that cannot be delegated), receded from on other grounds, Pope, 561 So.2d at 556. We also find that this error does not affect the result in this case.
Accordingly, we approve the district court's denial of Domberg's petition for writ of habeas corpus, but we disapprove the district court's opinion to the extent it is inconsistent with the holdings of Smith and Barbera.
It is so ordered.
GRIMES, C.J., and SHAW and HARDING, JJ., concur.
KOGAN, WELLS and ANSTEAD, JJ., concur in result only.
NOTES
[1] Limited by Wuornos v. State, 644 So.2d 1000, 1008 n. 4 (Fla. 1994), cert. denied, ___ U.S. ___, 115 S.Ct. 1705, 131 L.Ed.2d 566 (1995).
[2] Receded from on other grounds, Pope v. State, 561 So.2d 554 (Fla. 1990).
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522 P.2d 1221 (1974)
George D. SINGLETON, Appellant,
v.
The STATE of Nevada, Respondent.
No. 7228.
Supreme Court of Nevada.
June 6, 1974.
*1222 Morgan D. Harris, Public Defender and Michael A. Cherry, Deputy Public Defender, Las Vegas, for appellant.
Robert List, Atty. Gen., Carson City, Roy A. Woofter, Dist. Atty. and Daniel M. Seaton, Deputy Dist. Atty., Las Vegas, for respondent.
OPINION
ZENOFF, Justice:
Appellant George D. Singleton was convicted of the killing of Carl Arthur Benson in Las Vegas and was sentenced to life imprisonment without possibility of parole.
The volume of proof of his complicity was abundant. His defense was based almost entirely on that of insanity. The jury, however, accepted the expert testimony that Singleton knew the difference between right and wrong when he committed the killing.
The issues raised on appeal deal not with the weight of the evidence but with certain purported errors.
1. One question concerns the privilege of the attorney-client relationship. Robert Archie, an attorney who at one time represented Singleton in matters other than this offense, testified on rebuttal that Singleton was his client during 1970, that it was his opinion that Singleton wasn't always truthful and that he always found Singleton to be a lucid individual. The defense objects that Archie's testimony constituted a violation of the attorney-client privilege.[1] The State, on the other hand, contends that the testimony offered by Mr. Archie does not fall within the protection of the attorney-client privilege. We need not decide this question because we hold that Mr. Singleton waived the privilege when he called various attorneys who had previously represented him to testify on the sanity issue.[2] Mr. Singleton placed in issue both his sanity and his credibility and Mr. Archie's testimony was proper rebuttal.
2. Dr. Hess, a clinical psychologist, was called by the defense to testify regarding Singleton's mental health. He testified that his results were confirmed by earlier tests conducted by Mr. Long. On cross-examination Dr. Hess was asked if he was aware that Mr. Long's certificate to act as a psychologist in Nevada was under review for allegedly representing that he had certain educational qualifications that he in fact did not have. Appellant objected that this was improper impeachment of the witness.
The question was proper under NRS 50.305.[3] The statute is dispositive. The *1223 credibility of a source used by Dr. Hess in arriving at his opinion was an underlying fact which could be pursued on cross-examination. See Hope v. Arrowhead & Puritas Waters, Inc., 174 Cal. App.2d 222, 344 P.2d 428 (1959).
3. Appellant claims prejudicial error for failure of the trial court to give certain instructions involving the "state of mind" doctrine. This doctrine was a subject of discussion by this court in Fox v. State, 73 Nev. 241, 316 P.2d 924 (1957), wherein the court was concerned with two separate factual issues. (1) Was the mind of the defendant capable of premeditating? (2) Assuming that the defendant was capable of premeditating, did he in fact premeditate? That Singleton had the capacity to premeditate is implicit in the jury's failure to render a verdict of not guilty by reason of insanity. A mental disorder less than insanity does not of itself destroy the capacity to premeditate or to entertain the requisite intent. Fox v. State, supra.
There is no evidence of tensional circumstances described in Fox, supra, which would compel the court to give the requested instruction. An instruction need not be given when there is no proof in the record to support it. State v. Parr, 129 Mont. 175, 283 P.2d 1086 (Mont. 1955); Velasquez v. United States, 244 F.2d 416 (10th Cir.1957); cf. Barger v. State, 81 Nev. 548, 407 P.2d 584 (1965).
4. Dr. William O'Gorman, following his initial examination of the defendant, indicated that Singleton's I.Q. was in the idiot level range but revised his opinion concerning Singleton's sanity after receiving additional information. Since NRS 194.010 removes idiots, lunatics and insane persons from the class of persons who may be punished for crime, appellant contends that O'Gorman's testimony brought him within the statute.
An idiot is a person destitute of mind at birth or a person of such weak and feeble mind existing from birth as renders him incapable of knowing right from wrong or, knowing, has not by reason of such mental condition the will power to resist. Jones v. Commonwealth, 154 Ky. 752, 159 S.W. 568, 569 (Ky.App. 1913); Hauber v. Leibold, 76 Neb. 706, 107 N.W. 1042, 1044 (Neb. 1906).
The record does not support a conclusion that Singleton can be classified as an idiot according to the legal definition. Whether he was able to distinguish right from wrong was adequately covered by the instruction on insanity.
5. Appellant also raises the issue that he was denied equal time in his closing argument to the jury. There is no merit to that contention nor to his objection that Dr. James Clarke, a pathologist, was not competent to testify to the maximum and minimum caliber weapon that killed the victim. Dr. Clarke's experience in treatimg hundreds of gunshot wounds and his familiarity with certain caliber weapons was sufficient to establish his competency to testify. Cf. People v. Anderson, 518 P.2d 828 (Colo. 1974). The competency of an expert is for the trial court to determine and will not be grounds for reversal absent a clear showing of abuse.
Affirmed.
THOMPSON, C.J., and MOWBRAY, GUNDERSON and BATJER, JJ., concur.
NOTES
[1] NRS 49.095 General rule of privilege. A client has a privilege to refuse to disclose, and to prevent any other person from disclosing, confidential communications:
1. Between himself or his representative and his lawyer or his lawyer's representative.
. . . . .
[2] This court does not view favorably the practice of calling attorneys to testify concerning their impressions or relationships with clients who have become litigants. This observation is subject, of course, to established exceptions.
[3] NRS 50.305 Disclosure of facts, data underlying expert opinion. The expert may testify in terms of opinion or inference and give his reasons therefor without prior disclosure of the underlying facts or data, unless the judge requires otherwise. The expert may in any event be required to disclose the underlying facts or data on cross-examination.
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950 A.2d 1179 (2008)
John F. CORRIGAN et al.
v.
Kenneth NANIAN et al.
No. 2007-182-Appeal.
Supreme Court of Rhode Island.
June 9, 2008.
John Corrigan, Plaintiff Pro Se.
Stephen Rodio, For Defendants.
ORDER
The plaintiffs appeal from the entry of judgment in favor of the defendants in an action whereby the plaintiffs sought to quiet title to a portion of real estate located in East Greenwich in reliance upon the doctrine of adverse possession or, alternatively, that of acquiescence. In their appeal to this Court, the plaintiffs contend that the trial justice, who sat without a jury, erroneously interpreted the factual evidence when he concluded that the plaintiffs had failed to demonstrate either: (1) that they had taken title by adverse possession; or (2) that they had acquired title as a result of the defendants' acquiescence.
Pursuant to G.L. 1956 § 34-7-1, a person may acquire title to real property by adverse possession by satisfying a number of requirements. According to that statute, adverse possession occurs:
"[w]here any person or persons, or others from whom he, she, or they derive their title, either by themselves, tenants or lessees, shall have been for the space of ten (10) years in the uninterrupted, quiet, peaceful and actual seisin and possession of any lands, tenements or hereditaments for and during that time, claiming the same as his, her or their proper, sole and rightful estate in fee simple * * *."
The statute provides that when a person fulfills those requirements, "the actual seisin and possession shall be allowed to give and make a good and rightful title to the person or persons, their heirs and assigns forever * * *." Id. The party who asserts that adverse possession has occurred must establish the required elements by strict proof, that is, proof by clear and convincing evidence." Tavares v. Beck, 814 A.2d 346, 350 (R.I.2003) (internal quotation marks omitted).
Even though we do not have the benefit of a full record for us to review, we have scrutinized the findings of the trial justice and we do not hesitate to agree with him that plaintiffs have failed to demonstrate by clear and convincing evidence that their use of defendants' property was "actual, open, notorious, hostile, under claim of right, continuous, and exclusive for at least ten years." Acampora v. Pearson, 899 A.2d 459, 466 (R.I.2006) (internal quotation marks omitted).
In a lengthy and well-reasoned decision, the trial justice reviewed the evidence and testimony that had come before him, made credibility determinations, and concluded that plaintiffs had failed to show by clear and convincing evidence that they had fulfilled the requirements for taking title by adverse possession or by acquiescence. With respect to the adverse possession claim, the trial justice concluded:
"If the plaintiffs cannot recognize their own property that they allegedly possessed exclusively and under claim of ownership, for under ten years or greater, as well as all the other factors that The Court has pointed out, the plaintiffs have not sustained their burden by clear and convincing evidence that they adversely possessed this property in the so-called disputed area."
He further observed that plaintiffs had presented "little, if any, evidence" with *1180 respect to their claim that they were entitled to ownership of the disputed property pursuant to a theory of acquiescence. Accordingly, he also ruled that plaintiffs had failed to sustain their burden of proof in their acquiescence claim against defendants.
The applicable standard of review with respect to "the findings of a trial justice sitting without a jury is quite deferential." In re Dissolution of Anderson, Zangari & Bossian, 888 A.2d 973, 975 (R.I.2006); see Pucino v. Uttley, 785 A.2d 183, 187 (R.I. 2001) (explaining that this Court reviews trial court findings on the issue of acquiescence with "the deference accorded to determinations involving mixed questions of law and fact"); see also Burke-Tarr Co. v. Ferland Corp., 724 A.2d 1014, 1018 (R.I. 1999) (noting that "[t]he findings of fact by a trial justice sitting without a jury are entitled to great weight and shall not be disturbed on appeal unless the record shows that the findings are clearly wrong or unless the trial justice overlooked or misconceived material evidence * * *").
We perceive no clear error in the trial justice's conclusion that the plaintiffs failed to meet the required burden of proof with respect to both their adverse possession claim and also their acquiescence claim. The plaintiffs' appeal is therefore denied and dismissed.
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Filed 9/29/14 P. v. Brown CA2/4
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION FOUR
THE PEOPLE, B250843
Plaintiff and Respondent, (Los Angeles County
Super. Ct. No. BA397387)
v.
STEVEN BROWN,
Defendant and Appellant.
APPEAL from a judgment of the Superior Court of Los Angeles County, Monica
Bachner, Judge. Affirmed.
Adrian K. Panton, under appointment by the Court of Appeal, for Defendant and
Appellant.
Kamala D. Harris, Attorney General, Dane R. Gillette, Chief Assistant Attorney
General, Lance E. Winters, Senior Assistant Attorney General, James William Bilderback
II, Supervising Deputy Attorney General, and Marc A. Kohm, Deputy Attorney General,
for Plaintiff and Respondent.
INTRODUCTION
A jury convicted defendant Steven Brown of corporal injury on a spouse (Pen.
Code, § 273.5, subd. (a)), and found true an allegation that he personally inflicted great
bodily injury (Pen. Code, § 12022.7, subd. (e)).1 The trial court found that defendant had
suffered a prior strike (§§ 667, subds. (b)-(i), 1170.12, subds. (a)-(d)) and a prior serious
felony conviction (§ 667.5, subd. (b)). The trial court sentenced defendant to a total of 14
years in state prison, consisting of a three-year midterm, doubled to six years based on
the prior strike finding, plus five years for the prior serious felony conviction, plus three
years for the great bodily injury enhancement.
On appeal, defendant contends that the conviction must be reversed because the
trial court failed to instruct the jury, sua sponte, with a jury instruction regarding the
limited relevance of expert testimony regarding battered spouse syndrome, also referred
to as intimate partner battering. We conclude that regardless of whether the trial court
had a sua sponte duty to give the instruction, the omission of the instruction was harmless
error because the evidence of defendant’s guilt, independent of the effect of the expert
testimony, was overwhelming. We therefore affirm the judgment.
FACTUAL BACKGROUND
As of May 3, 2012, defendant and the victim, Adriana B, had been married for
nine years. They lived in a house on property they shared with defendant’s father, Steven
Brown, Sr. (“Brown, Sr.”), which was owned by defendant’s grandmother. On May 4,
2012, around 2:00 a.m., defendant and Adriana began arguing in their bedroom. Adriana
went into the hallway and defendant followed. He jerked her to the ground, held her
down by her hair, and punched her in the face with his fist. Adriana briefly got away and
went into the living room, where their two young children were sleeping. Defendant
1 All further statutory references are to the Penal Code.
2
followed her and again jerked her to the ground and punched her several more times.
Adriana managed to get away and opened the front door, at which point Brown, Sr.
entered the home and took defendant outside. Defendant’s repeated blows to Adriana’s
face resulted in her nose being broken in two places.
Adriana called 911 and told the operator that defendant had attacked her and that
his father was holding him outside. Paramedics and police officers arrived a few minutes
later, and Adriana told the responding officer that defendant had attacked her. The
responding officer observed that Adriana’s nose was bruised, her lip was swollen, there
were red marks on her face, she complained of pain in the back of her head, and she was
upset and crying. Adriana was taken by ambulance to Centinela Hospital.
Adriana spoke to Los Angeles Police Detective Sheryl Reynolds on the evening of
May 4, and described to Detective Reynolds that defendant had beaten her during an
argument, twice holding her down by her hair and punching her in the face as described
above. Adriana said defendant had been drinking alcohol and using methamphetamines
and marijuana. When Reynolds asked if Adriana wanted to prosecute defendant, she said
she was not sure.
Between the time of defendant’s arrest and his trial, he spoke to Adriana on the
phone more than 75 times. As defendant was in custody, those calls were recorded, and
some of the recordings were played to the jury. During one call, defendant told Adriana
“I fucking love you, blood. You love me, but you don’t fucking bow down and be my
bitch, blood.” He said he did not have anybody else besides her, and implied that she had
been unfaithful. Adriana said she was not trying to “break you down or nothing, but
damn, you making it seem like I’m the one *** nigger, you fucking broke my nose.” In
response, defendant blamed his behavior on using drugs and said he had been
hallucinating. After asking her to tell him everything she had said to the police, “so I can
see what kind of case I have,” he said “I apologize about that nose, . . . I wish I could kiss
you until you get better, but I fucked up. I’m so sorry, blood.” Adriana told defendant
during a different phone call that she had told the detective she did not want to prosecute,
3
and defendant asked if she had been told “how much time” he was going to get. During
another phone call, defendant began the conversation by saying, “Don’t you never
fucking hang up on me again. *** your fucking life, bitch. Is you stupid? Don’t you
fucking hang up on me. You know I’m gonna get out one day, right?” He told her, “If
you really wanted to be with me, you wouldn’t bring your stupid ass to court.” She
responded that he preferred that she “get locked up,” but he assured her she was not
going to be locked up. He denied being mad at her, but added, “Just know one thing,
baby. What goes around comes the fuck back around.” He ended the call by saying,
“Don’t come to court.”
During another call, defendant asked Adriana to hire an attorney to represent him
and repeatedly apologized and said he loved her, promising to never hit her again. His
comments included: “I went so crazy”; “I think it shouldn’t a went that far, and I do
apologize”; “it had to be the drugs”; “I didn’t mean for *** to go that far outta control”;
“I wish I could take that whole day back or just the few hours that a nigger lost his
mind”; “Before I ever think about hitting you, *** fucking hit myself right out of the
house. I’ll run away before I fucking feel like raising my hand to you again. I’ll just run
away. I wouldn’t stand there hit you no more”; and “I’m never gonna hit you again.”
Defendant repeatedly urged Adriana to help him get out of jail, saying, “Please, man,
help me get out, man.” She mentioned an arrest warrant could be issued if she “didn’t
show up.” He said “you could show up, but just tell them . . . . Tell them the truth, ***
you know. I mean, I think the—I think it’s the drugs. That’s what I think. Keep it real.”
After brief additional discussion, which was redacted, he said, “I need you to lie.” He
told her, “Try to help me get as less time as I can, Adriana. So I can get back to ***. See
my kids.”
On May 10, 2012, Detective Reynolds served Adriana with a subpoena to appear
at the preliminary hearing. Adriana indicated she was reluctant to testify. Nonetheless,
Adriana appeared at the preliminary hearing on May 22, 2012. She was hesitant to
testify, but did answer some questions.
4
On June 4, 2012, Adriana sent an email to the prosecutor then handling the case, in
which she said she had lied about defendant attacking her. She did not, however,
mention the purported involvement of any third person. Adriana retained defendant’s
defense attorney and spoke with him several times before trial.
At trial, for the first time Adriana offered an entirely different version of events.
She claimed that a woman named Kimberly Proctor, who was having an affair with
defendant, came to the house around midnight. Adriana said she argued with Kimberly,
and the argument progressed to a physical fight during which Kimberly broke Adriana’s
nose. Later, in order to prevent defendant from leaving the house, Adriana drugged
defendant with Ambien. Because of the Ambien, defendant was groggy and accidentally
bumped Adriana in the face with his elbow. Adriana claimed that she falsely identified
defendant as her attacker—including to the 911 operator, the responding police officers,
and Detective Reynolds—because she was angry at defendant for being unfaithful and
was embarrassed that Kimberly had beaten her. As to why she did not mention Kimberly
to the police, or at the preliminary hearing, Adriana said that she tried to contact
Detective Reynolds to tell her the truth, but was unsuccessful. Detective Reynolds
testified that to her knowledge Adriana never attempted to contact her. At the time of
trial, Adriana was still living on property owned by defendant’s grandmother.
Adriana acknowledged the phone calls with defendant, but said that when
defendant apologized to her, he was only apologizing for his infidelity. When she told
him that he had broken her nose, she meant that he did not make Kimberly leave their
home and had allowed Kimberly to break her nose. She denied that he said he needed her
to lie, claiming instead that he said “like.” She had no explanation for why he said, “I’m
never gonna hit you again”, other than to say, “That’s what it says, but I know it had a
different meaning to it. We have a certain way of talking, which you probably wouldn’t
understand. Because I mean, I read along with it, and I tell you, the way you’re taking it
is not how it was meant.”
5
Brown, Sr. testified that on the night of the incident he was awakened around 2:00
a.m. by loud arguing. He approached defendant’s home and saw that the front door was
open. He did not see Adriana at first, but observed defendant acting strangely. After
accompanying defendant into the bedroom to get dressed, Brown, Sr. led defendant
outside and waited with him until the police arrived. When they were in defendant’s
bedroom, Brown, Sr. detected a chemical odor he believed was PCP. Brown, Sr. had
heard a loud bang earlier in the evening, but he had not investigated. Brown, Sr. said he
had spoken to defendant two weeks previously “about arguing.”
Gail Pincus testified as an expert on domestic violence. Her testimony was meant
to educate the jury in general on how battered women think, feel, and behave when they
are abused. According to Pincus, it was a common phenomenon for a woman in a
relationship to endure abuse by a spouse, be briefly willing to report that behavior to law
enforcement, and then recant the report. When the abuser is incarcerated, he often
attempts to reassert power and control over his partner through telephone contact, during
which the abuser typically alternates between apologizing and telling the victim he loves
her, then calling her abusive names and blaming her for his predicament of being
incarcerated. The abused partner begins by standing her ground, then is made to feel
sorry for the abuser as he portrays himself as the victim. Frequently the abuser dictates to
the woman the story that is going to be told in court, and the woman starts to feel more
responsible for protecting the batterer than protecting herself. The victim rationalizes the
incident and feels she has overreacted, and often recants her original report and tells
authorities she lied. The abuser tells the victim there will be no further abuse, and she
believes him.
Pincus stated that she had not read the police reports in this case and did not know
any specifics about the relationship between defendant and Adriana. Even though the
defense attorney had spoken to her by telephone as she was on her way to court and told
her some things about the case, she said she was not tailoring her testimony to any
6
specific facts. She clarified that she was not testifying on behalf of anybody; rather, her
role was to educate the jury about common misconceptions about domestic violence.
Defendant did not call any witnesses and did not present evidence.
DISCUSSION
I. Failure to Instruct Regarding Limited Use of Expert Testimony on Intimate
Partner Battering
Defendant contends for the first time on appeal that the trial court failed to give a
sua sponte limiting instruction regarding the permissible use of expert testimony on the
subject of intimate partner battering, and that the erroneous omission of this limiting
instruction constituted prejudicial error as measured by the standard enunciated in People
v. Watson (1956) 46 Cal.2d 818, 836. We conclude that even if the trial court was
required to give the instruction in the absence of a defense request, its omission was not
prejudicial and does not require reversal.
A. The Applicable Law
“[Evidence Code] Section 801, subdivision (a), permits expert testimony on
subjects ‘sufficiently beyond common experience that the opinion of an expert would
assist the trier of fact.’ [Evidence Code] Section 1107, subdivision (a), provides: ‘In a
criminal action, expert testimony is admissible by either the prosecution or the defense
regarding intimate partner battering and its effects, including the nature and effect of
physical, emotional, or mental abuse on the beliefs, perceptions, or behavior of victims of
domestic violence, except when offered against a criminal defendant to prove the
occurrence of the act or acts of abuse which form the basis of the criminal charge.’”
(People v. Kovacich (2011) 201 Cal.App.4th 863, 898.)
In People v. Brown (2004) 33 Cal.4th 892 (Brown), the California Supreme Court,
in discussing the admissibility of expert testimony regarding the “cycle of violence” in an
abusive relationship between intimate partners, concisely explained as follows: “‘When
7
the trial testimony of an alleged victim of domestic violence is inconsistent with what the
victim had earlier told the police, the jurors may well assume that the victim is an
untruthful or unreliable witness. [Citations.] And when the victim’s trial testimony
supports the defendant or minimizes the violence of his actions, the jurors may assume
that if there really had been abusive behavior, the victim would not be testifying in the
defendant’s favor. [Citations.] These are common notions about domestic violence
victims akin to those notions about rape and child abuse victims that this court discussed
in People v. Bledsoe [(1984)] 36 Cal.3d 236 and [People v.] McAlpin, [(1991)] 53 Cal.3d
1289, and that the Court of Appeal discussed in People v. Housley [(1992)] 6 Cal.App.4th
[947], 955-956, [where expert testimony was held to be admissible to explain a child’s
recantation of her molestation claim].’ (Brown, supra, 33 Cal.4th at pp. 906-907.)”
The Defendant contends that the court was required to give CALCRIM No. 850,
sua sponte. It would have read as follows: “You have heard testimony from [Gail
Pincus] regarding the effect of (battered women’s syndrome/ intimate partner
battering[]). [Gail Pincus]’s testimony about (battered women’s syndrome/intimate
partner battering[]) is not evidence that the defendant committed any of the crimes
charged against (him/her). You may consider this evidence only in deciding whether or
not [Adriana B.’s] conduct was not inconsistent with the conduct of someone who has
been abused, and in evaluating the believability of (his/her) testimony.”
As defendant points out, the bench note for CALCRIM No. 850 indicates that
there is a sua sponte duty to give the instruction when supported by the evidence. The
bench note cites People v. Housley (1992) 6 Cal.App.4th 947 (Housley), which involved
testimony by an expert on child molestation that victims of such abuse commonly delay
reporting the abuse and often recant. (Housley, supra, at p. 952.) The Housley court
noted that “It is well settled that expert testimony concerning [child sexual abuse
accommodation syndrome (CSAAS)] only may be used to disabuse the jury of commonly
held misconceptions regarding the behavior of abuse victims, and may not be used to
corroborate the victim’s claims of abuse. (People v. Bowker [(1988)] 203 Cal.App.3d
8
[384] at 394.) However, there is some disagreement concerning whether the defendant is
entitled to a sua sponte instruction specifically limiting the use of this evidence.”
(Housley, supra, at p. 957.) The Housley court acknowledged that “[g]enerally, ‘absent a
request by a party, there is no duty to give an instruction limiting the purpose for which
evidence may be considered.’ (People v. Nudd (1974) 12 Cal.3d 204, 209, overruled on a
different issue in People v. Disbrow (1976) 16 Cal.3d 101, 113; see also Evid. Code,
§ 355.) However, a trial court is obligated to give sua sponte instructions regarding the
‘general principles of law relevant to the issues raised by the evidence.’ (People v. St.
Martin (1970) 1 Cal.3d 524, 531.) The court is also required to instruct the jury sua
sponte on the weight to be given expert testimony. (Pen. Code, § 1127b.)” (Housley,
supra, at 957.)
The Housley court observed that testimony from a recognized expert “easily could
be misconstrued by the jury as corroboration for the victim’s claims.” (Housley, supra, at
p. 958.) Thus, requiring an instruction defining the proper use of such evidence “would
prevent the jury from accepting the expert testimony as proof of the molestation,” and
“would avoid potentially erroneous convictions occasioned by counsel’s inadvertent or
incompetent failure to request a limiting admonition. Finally, there is no point in
requiring that jurors be instructed concerning the proper weight to be accorded expert
testimony (Pen. Code, § 1127b) when they are not advised of the proper use of this
testimony.” (Housley, supra, at p. 958.) The court “conclude[d] that because of the
potential for misuse of CSAAS evidence, and the potential for great prejudice to the
defendant in the event such evidence is misused, it is appropriate to impose upon the
courts a duty to render a sua sponte instruction limiting the use of such evidence.”
(Housley, supra, at 958-959.)
Respondent counters that the California Supreme Court has repeatedly held that
there is no sua sponte duty to instruct regarding the limited admissibility of evidence.
(Citing People v. Valdez (2012) 55 Cal.4th 82, 139; see, e.g., People v. Riccardi (2012)
54 Cal.4th 758, 824 [no sua sponte duty to instruct regarding the limited relevance of
9
hearsay testimony]; People v. Hernandez (2004) 33 Cal.4th 1040, 1051-1052 [no sua
sponte duty to instruct regarding the limited relevance of gang evidence]; People v.
Farnam (2002) 28 Cal.4th 107, 163-164 [no sua sponte duty to instruct regarding the
limited relevance of character evidence].) While that is an accurate statement, we do not
find the categories of evidence considered in the cases cited by respondent to be
particularly relevant to the situation before us, involving evidence by an expert regarding
intimate partner battering and the limited purpose for which such evidence may be used
by a jury.
In People v. Collie (1981) 30 Cal.3d 43, 63-64, our Supreme Court addressed,
albeit in a different evidentiary context, the difference between cases in which courts
have a sua sponte duty to instruct and those in which they do not: “Defendant complains
that the trial court should have instructed the jury sua sponte on the limited admissibility
of evidence of previous assaults he allegedly committed on his wife. [Fn.] Although the
trial court may in an appropriate case instruct sua sponte on the limited admissibility of
evidence of past criminal conduct, we have consistently held that it is under no duty to do
so. [Citations.] We have more recently decided that in many cases sua sponte
instructions regarding relevant defenses [citations] and lesser included offenses
[citations] are required because those matters are ‘closely and openly connected’ with the
evidence and the fate of the defendant in cases to which they apply. [Citations.]” (Id. at
pp. 63-64.) “There may be an occasional extraordinary case in which unprotested
evidence of past offenses is a dominant part of the evidence against the accused, and is
both highly prejudicial and minimally relevant to any legitimate purpose. In such a
setting, the evidence might be so obviously important to the case that sua sponte
instruction would be needed to protect the defendant from his counsel’s inadvertence.”
(Id. at 64; italics added.) The Collie court concluded that in the case before it the
defendant had failed to show that the limited admissibility of evidence of his past
criminal conduct deserved unsolicited recognition and instruction by the trial court.
(Ibid.)
10
B. Analysis
In our view there remains some question whether a court is obligated sua sponte to
give a limiting instruction concerning expert testimony on battered women’s syndrome.
Only Housley, supra, 6 Cal.App.4th at p. 947 has held that a court has a sua sponte duty
to give a limiting instruction in that context. Since Housley was decided in 1992, that
aspect of the case has not been approved or cited by any subsequent reported case. We
note that Evidence Code section 355 provides that “[w]hen evidence is admissible . . . for
one purpose and is inadmissible . . . for another purpose, the court upon request shall
restrict the evidence to its proper scope and instruct the jury accordingly.” (Italics
added.) However, we agree with the concerns expressed in Housley that expert testimony
regarding intimate partner battering is “‘closely and openly connected’” with the
evidence. (Collie, supra, at p. 64.) While the expert testimony is highly relevant to a
legitimate purpose—educating the jury regarding the dynamics of intimate partner
battering—the potential prejudice to a defendant is significant if the jury misuses such
testimony as corroborative evidence of guilt.
We conclude, however, that we need not definitively decide whether the court had
a sua sponte duty to instruct on the limited permissible use of Pincus’s testimony
regarding intimate partner battering. Even assuming that such a duty existed, the absence
of the instruction was harmless error and does not require reversal.
Pincus’s testimony was not directed to prove and did not state that defendant in
fact physically abused Adriana, was instead properly limited to discussion of the
characteristics of battered woman’s syndrome. She made clear that she did not know the
facts of the case and was discussing the syndrome in general rather than addressing any
particular factual scenario, including that involved in this case. Pincus’s testimony
provided an explanation that counter-balanced the defense contention that Adriana lied
about defendant physically assaulting her because she was angry that he had been
unfaithful to her. Her testimony was couched in general terms, and described behavior
common to abused victims as a class, rather than any individual victim. In the face of
11
this testimony, it is unlikely the jury interpreted her statements as corroborative evidence
that defendant abused Adriana. Because Pincus’s testimony contained only generalized
explanations of the dynamics of domestic violence and she specifically stated she was not
expressing an opinion regarding defendant and Adriana’s relationship, it is not reasonably
probable the jury misused Pincus’s testimony to draw the inference prohibited by
Evidence Code section 1107, subdivision (a). It is not reasonably probable a more
favorable result would have occurred had the limiting instruction been given. (People v.
Watson, supra, 46 Cal.2d at p. 836.)
As distinguished from Housley, supra, 6 Cal.App.4th at p. 958, we note that this
case did not come down to a credibility contest between the victim’s word and the
defendant’s. There was ample evidence, primarily in defendant’s own voice (as well as
Adriana’s) on the recorded telephone calls from jail, acknowledging that he had struck
her and broken her nose. He apologized profusely for having done so, blamed his drug
use, and vowed never to hit her again. He asked her to help him get out of jail, told her
not to go to court, and asked her to lie about what had happened. His demeanor toward
Adriana during the telephone calls was often distinctly controlling and abusive. Adriana
had already begun expressing doubt about prosecuting defendant when she spoke to
Detective Reynolds the night of the assault. Yet, it was not until much later that she first
reported that Kimberly Proctor had broken her nose. The testimony by Pincus provided a
highly relevant explanation, beyond the ken of the average juror, as to why Adriana
would retract her report that defendant had abused her and testify in his defense as she
did at trial, even in the face of the recorded telephone calls.
The jury was properly instructed that it should consider with caution any statement
made by defendant tending to show his guilt, unless the statement was recorded, and that
a defendant may not be convicted of a crime based on his out-of-court statements alone.
The jury was instructed that it could rely on defendant’s out-of-court statements to
convict him if it concluded that other evidence—which could be slight and need only be
enough to support a reasonable inference that a crime was committed—showed that the
12
charged crime was committed. In addition, the jury was instructed that the identity of the
person who committed the crime may be proved by the defendant’s statements alone.
Thus, as to the critical evidence regarding defendant’s guilt, his own recorded statements,
the jury was properly instructed. Brown, Sr. provided additional corroborative evidence
when he acknowledged that defendant was using methamphetamines and PCP at the time
of the incident, and that defendant and Adriana were loudly arguing. Brown, Sr.’s
testimony regarding defendant’s drug use was consistent with what defendant said during
the telephone calls as the reason he lost control and injured Adriana, and directly
contradicted Adriana’s trial testimony that she had secretly given defendant Ambien.
Considered as a whole, the evidence of defendant’s guilt was overwhelming, and
therefore the trial court’s error, if any, in failing to give a limiting instruction regarding
Pincus’s testimony was clearly harmless.
DISPOSITION
The judgment is affirmed.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS
COLLINS, J.
We concur:
EPSTEIN, P. J.
MANELLA, J.
13
| {
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RECEIVED IN
*\ COURT OF CRIMINAL APPEALS
NOV 3 0 2015
il/13-.'zyis
Abel Acosta, Clerk
j. know you recently receivea my son s appeal/ josepn c. jones lR12617. I aiso
realize time is short or has passed.
i' =ve enclosed a copy of concerns, that Need to be addressed. I've also enclosed a
copy of the complete record of the court proceedings.
I also am aware of the fact that my son's ti^V^pHLoX^ A^S^o bescuase hgdid not
reouest a new trial because his attorney did not cross
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could ? Someone should have told him.
As -a Rotrrsr I rs'fusfi to accspt ihst Lhsrs is sjo Oiis tfast car5s sxcspi trrs^ I will
continue to fight for my son. He deserves a fair
sentencing, i-ie didn't kill anyone. He's not a bad person. Not just because I'm his
LU LCJL1I y IU Uldl..
Seems to me- that IF the legal sector of this is who caused him to commit this
illegal act , wouldn't that be sntrapK-ent? Or is it legal?>
for law enforcement to do illegal acts lust to meet thier auota ? if vou allow
yourself to actually read thru my sc*}s court proceedings
you win 'i"ind that ne oidn'T nave any money, didn't have drugs, didn't even have a
scale. But was labeled a drug dealer. Law enforcement
provided the money, the scale, and waittedJntil he coDld find someone who had the
rjpijoc. why riidnt thev arrest that individual ? The
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rage j.
able acosta
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Abie Acosta,
X"fn- writing in regards to ray son- .lossph Dongs; rscsntiy r8£«ivso forty-fivs years
for delivery of a controlled substance, >lgm <4gms
ui iiiccii. x Miyw n±^ oluuiIo hci c: xxxcgoa., even Liiuugi! iic; wco ^ccup uy o
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she would not face charges of transporting large auanities of drugs with intent, to
sell. However that is not the reason as to why 1 am contacting you,
x -nsvs. ScVcPsx concerns 3nc? GU€S"LXons = hirst ^ hiy son W3S x.o±o dv nxs sttophsv t ±x.
i,i/*\i ilri Kcs -ir> hi c hoc+ ■lf^■♦-£sr^(e^c:+• anH *!•+• i.rnnl rl no aac t or* r*r» r*T m
if'he entered a plea of "GUILTY''. His attorney was not a court appointed. • My son
did not have a trial., since he followed his attorney's advice.
his sentencing was decided by a Jury. It took less than one day, and return with a
^srn'PnCxnSs of "-torl'v-"hive-1 "Prjps"' T k'no**' i**- i*'3c t*r"!f-jn'::*Mf~'*a(i-
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grand-daughter, the defendant's daughter told me her mother-in-law was
on the jury. Both .my son's daughters are married to this lady's two sons, I brought
this to (Richard Maddox) my son's attorney, he said already
he knew, as did the judge and the Procecuting Attorney. As Mrs. Ruth Ward brought
ic xo• tne jUQgc s a'ccentiors. He 010 ncrc excuse nsr. siny not/
Mrsc Ward told svsrvons outside the court room that she asked to .bs excused and the
judge said no. She also stated she .would be willing to give ;a
sworsn statement, to that, effect r I recentl'-' received 3 conolet.e coov of what tHs
court recorder recorded. No where in it is there any mention of
Mrs* Ward speakinp to the judge<. Whv/ not ? Whx' was Mrs. Ward allowed to continue to
bs on the "'ur-'? Was that notMisconduct of the court? Erscoura-in"
him to plea guilty. Is that not a violation of Loyalty to his client? By my son's
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Page 1
aoie acosta
'ne'-would sive a minion years to opus, otTendersJ= X lust want a Tair and honest
f ni al Tho ••-•imo "t"n -pi +• tho r r»i mo
My son has filed his own appeal. It is currently in Austin. 1 understand it requires
a brief. I have no clue as to how. I live in California. I still owe
(my brother)from the first attorney. Will I require another ? Can I just send my
corsc^r*ns or* r*£!C!u€sS't!S - r Q!" uo^s x*£ nsvs to t-6 xn 3 so^cxbX TOrrris*^ ?
I..a?r, 63, If my son has to do this outrageous amount of time* I'll be dead before he
is released. His daughter has her first baby in twelve days. Can you help me ?
qp send reg the right vi&y ? 1 understand there is a tirne 'factor with an appeal. I've-
enclosed a copy of the court proceedings, (from start tp finish).
Til- Jl- J- J-'
me J--c ~l -*1 J
Lime Snouxu rii uie crime, rxcase nexp nim. inanK you for your uime
Carolyn Smith
P.O.Bx. 248
Hinkley, Ca. 92347
if!fi!. /'60-^D j-Z/Z /•'
cell 760-577-4356 r
Page 2
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CR 126X7
Joseph C. Jones
1933850
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| {
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334 U.S. 717 (1948)
WEST
v.
OKLAHOMA TAX COMMISSION.
No. 489.
Supreme Court of United States.
Argued March 29-30, 1948.
Decided June 14, 1948.
APPEAL FROM THE SUPREME COURT OF OKLAHOMA.
Frank T. McCoy argued the cause for appellant. With him on the brief were John R. Pearson and Frank Mahan.
R.F. Barry and Joe M. Whitaker argued the cause for appellee. With them on the brief was C.W. King.
*718 MR. JUSTICE MURPHY delivered the opinion of the Court.
This appeal concerns the power of the State of Oklahoma to levy an inheritance tax on the estate of a restricted Osage Indian. Specifically, the problem is whether property held in trust by the United States for the benefit of the Indian may be included within the taxable estate.
Charles West, Jr., was a restricted, full-blood, unallotted, adult Osage Indian. He died intestate in 1940, a resident of Oklahoma. No certificate of competency was ever issued to him. Surviving him was his mother, appellant herein, who is a restricted, full-blood Osage Indian. The entire estate passed to her as the sole heir at law.[1]
The Oklahoma Tax Commission entered an order levying a tax on the transfer of the net estate, valued at $111,219.18. With penalties, the total tax imposed was $5,313.35. Appellant made timely objection to the inclusion of certain items in the taxable estate. These items formed the bulk of the estate and had been held in trust for the decedent by the United States, acting through the Secretary of the Interior. Act of June 28, 1906, 34 Stat. 539, as amended, 41 Stat. 1249, 45 Stat. 1478, 52 Stat. 1034. The trust properties involved were as follows:
(1) One and 915/2520ths Osage mineral headrights. This item represented the decedent's undivided interest in the oil, gas, coal and other minerals under the lands in Osage County, Oklahoma, said minerals having been *719 reserved to the use of the Osage Tribe by the Act of June 28, 1906.[2]
(2) Surplus funds in the United States Treasury, representing accruals of income to the decedent from the headrights.
(3) Stocks and bonds purchased by and in the name of the United States and held for the decedent by the Secretary of the Interior. These purchases were made with the surplus funds accruing from the headrights.
(4) Trust funds in the hands of the Treasurer of the United States, representing decedent's share of the proceeds of the sale of the Osage Tribe's lands in Kansas.
(5) Personal property purchased with surplus funds.
Appellant claimed that these properties were immune from state taxation by virtue of the relevant provisions of the Constitution, treaties and laws of the United States; hence the Oklahoma Inheritance and Transfer Tax Act of 1939 (§§ 989-989t, Title 68, Okla. Stat. 1941) which authorized the assessment on the properties was invalid in this respect. The Oklahoma Tax Commission rejected this contention and the Supreme Court of Oklahoma affirmed. 200 Okla. ___, 193 P.2d 1017.
It is essential at the outset to understand the history and nature of the arrangement whereby the United States *720 holds in trust the properties involved in this case. See Cohen, Handbook of Federal Indian Law (1945) 446-455. In 1866, the United States and the Cherokee Nation of Indians executed a comprehensive treaty covering their various relationships. 14 Stat. 799. It was there agreed that the United States might settle friendly Indians in certain areas of Cherokee territory, including what is now Osage County, Oklahoma; these areas had previously been conveyed by the United States to the Cherokees. The treaty further provided that the areas in question were to be conveyed in fee simple to the tribes settled by the United States "to be held in common or by their members in severalty as the United States may decide."
The Osage Indians subsequently moved to the Indian Territory and settled in what is now Osage County. In 1883, pursuant to the 1866 treaty, the Cherokees conveyed this area to the United States "in trust nevertheless and for the use and benefit of the said Osage and Kansas Indians." It is significant that fee simple title to the land was not conveyed at this time to the Osages; instead, the United States received that title as trustee for the Osages. Nor was any distinction here made between the land and the minerals thereunder, legal title to both being transferred to the United States.
On June 28, 1906, the Osage Allotment Act, providing for the distribution of Osage lands and properties, became effective. 34 Stat. 539. See Levindale Lead Co. v. Coleman, 241 U.S. 432. Provision was there made for the allotment to each tribal member of a 160-acre homestead, plus certain additional surplus lands. These allotted lands, said § 7, were to be set aside "for the sole use and benefit of the individual members of the tribe entitled thereto, or to their heirs, as herein provided." The homestead was to be inalienable and nontaxable for 25 years or during the life of the allottee. The surplus lands, however, were to be inalienable for 25 years and nontaxable *721 for 3 years, except that the Secretary of the Interior might issue a certificate of competence to an adult, authorizing him to sell all of his surplus lands; upon the issuance of such a certificate, or upon the death of the allottee, the surplus lands were to become immediately taxable. § 2, Seventh; Choteau v. Burnet, 283 U.S. 691.
Section 3 of the Act stated that the minerals covered by these lands were to be reserved to the Osage Tribe for a period of 25 years and that mineral leases and royalties were to be approved by the United States. Section 4 then provided that all money due or to become due to the tribe was to be held in trust by the United States for 25 years;[3] but these funds were to be segregated and credited pro rata to the individual members or their heirs, with interest accruing and being payable quarterly to the members. Royalties from the mineral leases were to be placed in the Treasury of the United States to the credit of the tribal members and distributed to the individual members in the same manner and at the same time as interest payments on other moneys held in trust. In this connection, it should be noted that quarterly payments of interest and royalties became so large that Congress later limited the amount of payments that could be made to those without certificates of competence; provision was also made for investing the surplus in bonds, stocks, etc.[4]
According to § 5 of this 1906 statute, at the end of the 25-year trust period "the lands, mineral interests, and *722 moneys, herein provided for and held in trust by the United States shall be the absolute property of the individual members of the Osage tribe, according to the role herein provided for, or their heirs, as herein provided, and deeds to said lands shall be issued to said members, or to their heirs, as herein provided, and said moneys shall be distributed to said members, or to their heirs, as herein provided, and said members shall have full control of said lands, moneys, and mineral interests, except as hereinbefore provided." It was also stated in § 2, Seventh, that the minerals upon the allotted lands "shall become the property of the individual owner of said land" at the expiration of 25 years, unless otherwise provided by Congress.
Moreover, § 6 provided that the lands, moneys and mineral interests of any deceased member of the Osage Tribe "shall descend to his or her legal heirs, according to the laws of the Territory of Oklahoma." Congress subsequently provided, in § 8 of the Act of April 18, 1912, 37 Stat. 86, 88, that any adult member of the tribe who was not mentally incompetent could by will dispose of "any or all of his estate, real, personal, or mixed, including trust funds, from which restrictions as to alienation have not been removed," in accordance with the laws of the State of Oklahoma. Such wills could not be probated, however, unless approved by the Secretary of the Interior before the death of the testator.
The 25-year trust period established by the 1906 statute has been extended several times by Congress, first to 1946 (41 Stat. 1249), then to 1958 (45 Stat. 1478), and finally to 1984 (52 Stat. 1034). The last extension provided *723 that the "lands, moneys, and other properties now or hereafter held in trust or under the supervision of the United States for the Osage Tribe of Indians, the members thereof, or their heirs and assigns, shall continue subject to such trusts and supervision until January 1, 1984, unless otherwise provided by Act of Congress."
Application of the foregoing provisions to the estate in issue produces this picture: Legal title to the mineral interests, the funds and the securities constituting the corpus of the trust estate is in the United States as trustee. The United States received legal title to the mineral interests in 1883, when it took what is now Osage County from the Cherokees in trust for the Osages; and that title has not subsequently been transferred. Legal title to the various funds and securities adhered to the United States as the pertinent trusts were established and developed. Beneficial title to these properties was vested in the decedent and is now held by his sole heir, the appellant. The beneficiary at all times has been entitled to at least a limited amount of interest and royalties arising out of the corpus. And the beneficiary has a reversionary interest in the corpus, an interest that will materialize only when the legal title passes from the United States at the end of the trust period. But until that period ends, the beneficiary has no control over the corpus. See Globe Indemnity Co. v. Bruce, 81 F.2d 143, 150.
Since 1819, when McCulloch v. Maryland, 4 Wheat. 316, was decided, it has been established that the property of the United States is immune from any form of state taxation, unless Congress expressly consents to the imposition of such liability. Van Brocklin v. Tennessee, 117 U.S. 151; United States v. Allegheny County, 322 U.S. 174. This tax immunity grows out of the supremacy of the Federal Government and the necessity that it be able to deal with its own property free from any interference or embarrassment that state taxation might impose. McCulloch v. *724 Maryland, supra; Wisconsin Railroad Co. v. Price County, 133 U.S. 496.
In United States v. Rickert, 188 U.S. 432, the same rule was held to apply where the United States holds legal title to land in trust for an Indian or a tribe. The United States there held legal title to certain lands in trust for a band of Sioux Indians which was in actual possession of the lands. This Court held that neither the lands nor the permanent improvements thereon were subject to state or local ad valorem taxes. It was emphasized that the fee title remained in the United States in obvious execution of its protective policy toward its wards, the Sioux Indians. To tax these lands and the improvements thereon, without congressional consent, would be to tax a means employed by the Government to accomplish beneficent objects relative to a dependent class of individuals. Moreover, the United States had agreed to convey the lands to the allottees in fee at the end of the trust period "free of all charge or incumbrances whatsoever." If the tax in question were assessed and unpaid, the lands could be sold by the tax authorities. The United States would thus be so burdened that it could not discharge its obligation to convey unencumbered land without paying the taxes imposed from year to year.
Further application of the tax immunity rule to land held in trust by the United States for the benefit of Indians was made in McCurdy v. United States, 264 U.S. 484. That case involved surplus lands that had been allotted to members of the Osage Tribe. It will be recalled that the Osage Allotment Act of June 28, 1906, had made these surplus lands expressly taxable after three years or at the death of the allottee. The allottees in the McCurdy case died within the three-year period but before deeds to their allotted lands had been executed and delivered to them. Oklahoma sought to place a tax on the lands, the taxable date being within the three-year period and before the execution and delivery of the deeds to the *725 heirs of the allottees. This Court held that legal title to the lands in issue was still in the United States as trustee on the taxable date, title not passing until the execution and delivery of the deeds. In reliance on the Rickert case, the conclusion was reached that the lands were not taxable while held in trust by the United States. See also United States v. Board of Comm'rs of Fremont County, Wyo., 145 F.2d 329; United States v. Thurston County, 143 F. 287.
Since the property here involved is all held in trust by the United States for the benefit of the decedent and his heirs, it is thought to be immune from any form of state taxation under the decisions in the Rickert and McCurdy cases. Reference is made to certain provisions of the Oklahoma Inheritance and Transfer Tax Act which indicate that the inheritance tax in issue might have a very real and direct effect upon the property to which the United States holds title, an effect similar to that which was emphasized in the Rickert case. The Act applies, of course, to the transfer of estates held in trust. § 989. Specific provision is then made in § 989i that "Taxes levied under this Act shall be and remain a lien upon all the property transferred until paid." Provision is also made for the sale of estate property if necessary to satisfy the tax. §§ 989i and 989l. It is therefore possible that if the tax were unpaid Oklahoma might try to place a lien upon the property which is being transferred, property as to which the United States holds legal title. Complications might arise as to the validity of such a lien. And the United States would be burdened to the extent of opposing the imposition of the lien or seeing that the tax was paid so as to avoid the lien.
Moreover, insofar as the inheritance tax is paid out of the surplus and trust funds held by the United States, there is a depletion of the corpus to which the United States holds legal title. Such depletion makes that much smaller the estate which the Government has seen fit to *726 hold in trust for the decedent's heirs. If the estate is to be tapped repeatedly by Oklahoma until 1984 by the deaths of the various heirs, the result may be a substantial decrease in the amount then available for distribution.
But our decision in Oklahoma Tax Commission v. United States, 319 U.S. 598, has foreclosed an application of the Rickert and McCurdy cases to the estate and inheritance tax situation. Among the properties involved in the Oklahoma Tax Commission case were restricted cash and securities, which could not be freely alienated or used by the Indians without the approval of the Secretary of the Interior. We held that the restriction, without more, was not the equivalent of a congressional grant of estate tax immunity for the transfer of the cash and securities. Moreover, express repudiation was made of the concept that these restricted properties were federal instrumentalities and therefore constitutionally exempt from estate tax consequences. See also Helvering v. Mountain Producers Corp., 303 U.S. 376. The very foundation upon which the Rickert case rested was thus held to be inapplicable.
We fail to see any substantial difference for estate tax purposes between restricted property and trust property. The power of Congress over both types of property is the same. Board of Commissioners v. Seber, 318 U.S. 705, 717; United States v. Ramsey, 271 U.S. 467, 471. Both devices have the common purpose of protecting those who have been found by Congress to be unable yet to assume a fully independent status relative to property. The effect which an estate or inheritance tax may have is the same in both instances; liens may be placed on both restricted and trust properties and lead to complications; and both types of property may of necessity be depleted to assure payment of the tax. The fact that the United States holds legal title as to trust property but not as to restricted property affords no distinguishing characteristic from the standpoint of an estate tax. In addition, Congress *727 has given no indication whatever that trust properties in general are to be given any greater tax exemption than restricted properties. Hence the Oklahoma Tax Commission case must control our disposition of this proceeding.
Implicit in this Court's refusal to apply the Rickert doctrine to an estate or inheritance tax situation is a recognition that such a tax rests upon a basis different from that underlying a property tax. An inheritance or estate tax is not levied on the property of which an estate is composed. Rather it is imposed upon the shifting of economic benefits and the privilege of transmitting or receiving such benefits. United States Trust Co. v. Helvering, 307 U.S. 57, 60; Whitney v. Tax Commission, 309 U.S. 530, 538. In this case, for example, the decedent had a vested interest in his Osage headright; and he had the right to receive the annual income from the trust properties and to receive all the properties at the end of the trust period. At his death, these interests and rights passed to his heir. It is the transfer of these incidents, rather than the trust properties themselves, that is the subject of the inheritance tax in question. In this setting, refinements of title are immaterial. Whether legal title to the properties is in the United States or in the decedent and his heir is of no consequence to the taxability of the transfer.
The result of permitting the imposition of the inheritance tax on the transfer of trust properties may be, as we have noted, to deplete the trust corpus and to create lien difficulties. But those are normal and intended consequences of the inheritance tax. And until Congress has in some affirmative way indicated that these burdens require that the transfer be immune from the inheritance tax liability, the Oklahoma Tax Commission case permits that liability to be imposed. But that case also makes clear that should any of the properties transferred be exempted by Congress from direct taxation they cannot *728 be included in the estate for inheritance tax purposes. No such properties are here involved, however.
We have considered the other points raised by the appellant but deem them to be without merit. The judgment below is therefore
Affirmed.
THE CHIEF JUSTICE, MR. JUSTICE FRANKFURTER and MR. JUSTICE DOUGLAS dissent.
NOTES
[1] The decedent was also survived by a widow. But she was prohibited by law from inheriting any part of the estate unless she was of Indian blood, a matter which was in dispute. A settlement was reached whereby the widow received a certain amount from the estate, apparently in return for giving up her claim as an heir.
[2] An Osage headright has been defined by one court as "the interest that a member of the tribe has in the Osage tribal trust estate, and the trust consists of the oil, gas, and mineral rights, and the funds which were placed to the credit of the Osage tribe, all fully set out in the above act [Act of June 28, 1906, 34 Stat. 539]." In re Denison, 38 F.2d 662, 664. Another court has made this definition: "The right to receive the trust funds and the mineral interests at the end of the trust period, and during that period to participate in the distribution of the bonuses and royalties arising from the mineral estates and the interest on the trust funds, is an Osage headright." Globe Indemnity Co. v. Bruce, 81 F.2d 143, 148-149. Headrights are not transferable and do not pass to a trustee in bankruptcy. Taylor v. Tayrien, 51 F.2d 884; Taylor v. Jones, 51 F.2d 892.
[3] The trust under which these funds were to be held was established in 1865 by treaty between the United States and the Great and Little Osage Indians, 14 Stat. 687. By the terms of this treaty, the proceeds of the sale of Osage lands in Kansas were to be placed in the United States Treasury to the credit of the tribe. Provisions for carrying out the terms of this treaty were made by Congress in 1880, 21 Stat. 291.
[4] By the Act of March 3, 1921, 41 Stat. 1249, Congress provided that so long as the income should be sufficient the adult Osage Indian without a certificate of competency should be paid $1,000 quarterly. See also Act of Feb. 27, 1925, 43 Stat. 1008. In the Act of June 24, 1938, 52 Stat. 1034, it was provided that where the restricted Osage had surplus funds in excess of $10,000 he was to be paid $1,000 quarterly, but if he had surplus funds of less than $10,000 he was to receive quarterly only his current income, not to exceed $1,000 quarterly.
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25 So.3d 1240 (2009)
SNIFFEN
v.
STATE.
No. 2D08-4698.
District Court of Appeal of Florida, Second District.
December 11, 2009.
Decision Without Published Opinion Affirmed.
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487 F.Supp. 808 (1980)
Samuel J. LEFRAK et al., Plaintiffs,
v.
ARABIAN AMERICAN OIL COMPANY et al., Defendants.
No. 74 C 1700.
United States District Court, E. D. New York.
January 10, 1980.
*809 *810 Berger & Montague, P. C. by David Berger, Stanley R. Wolfe, Philadelphia, Pa., Jerome Edelman, P. C. by Jerome Edelman, Brooklyn, N. Y., Richard S. Lefrak, Forest Hills, N. Y., for plaintiffs.
White & Case by Thomas Kiernan, Frederic S. Newman, New York City, for Arabian American Oil Co.
Sullivan & Cromwell by Robert M. Osgood, Kenneth M. Bialo, New York City, for Exxon Corp.
Lord, Day & Lord by Gordon B. Spivack, Thomas D. Brislin, New York City, for Standard Oil Co. of California.
Olwine, Connelly, Chase, O'Donnell & Weyher by William F. Sondericker, New York City, for Asiatic Petroleum Corp. (renamed Scallop Corp.).
Donovan, Leisure, Newton & Irvine by Sanford M. Litvack, New York City, for Mobil Oil Corp.
Lawrence R. Jerz, White Plains, N. Y., Kaye, Scholer, Fierman, Hays & Handler by Randolph S. Sherman, New York City, for Texaco, Inc.
Kissam, Halpin & Genovese by Anthony Genovese, Joel H. Blumkin, New York City, for Gulf Oil Co.
MEMORANDUM OF DECISION AND ORDER
COSTANTINO, District Judge.
In 1974, the plaintiffs, a group of home heating oil consumers (collectively referred to as "Lefrak"), brought a civil antitrust action to recover treble damages for overcharges due to price-fixing by the defendants, the major oil suppliers in the United States (collectively referred to as "Aramco").[1] Over a period of five years, the court oversaw a series of complicated legal stratagems which often raised new legal issues. The parties engaged in extensive discovery and settled into a long and extremely hard fought battle during the course of this litigation. On the eve of trial, and after such a brilliant exhibition of legal acumen and professionalism, a significant assembly of facts unravels itself before the court. Now, the saga has culminated not with trial but with a voluminous defense motion for summary judgment involving a controlling legal issue. As a result of the decisive nature of that issue, Lefrak's case has been halted as if by a wall an Illinois Brick wall.[2]
Aramco contends by its motion that Lefrak is barred by the principles of Illinois Brick Co. v. Illinois, 431 U.S. 720, 97 S.Ct. 2061, 52 L.Ed.2d 707 (1977) ["Illinois Brick"]. That decision holds that as a matter of law an indirect purchaser of goods is not entitled to sue for damages under the *811 antitrust laws. Aramco had previously moved for judgment on the pleadings pursuant to Fed.R.Civ.P. 12(c) on the basis of Illinois Brick. Lefrak survived that motion by amending its complaint, by leave of court, to allege an exception to Illinois Brick in that Aramco was controlling prices through so-called "pre-existing cost-plus contracts."[3] Thereafter, the parties engaged in an extended period of discovery predicated upon the existence of cost-plus contracts. Aramco's motion, and Lefrak's opposition to it, hinges upon that issue.
Aramco argues that Lefrak is an indirect purchaser, who did not buy oil from the defendants, and who did not purchase oil on the basis of pre-existing cost-plus contracts. Aramco contends that the same considerations presented in Illinois Brick exist here and require a summary judgment disposition.
Lefrak alleges that material issues of fact exist as to both its indirect purchaser position and the existence of a cost-plus contract. It presses the court to leave the resolution of those issues to the jury. Basically, Lefrak asserts that since it views the same contracts presented by Aramco in a different light, the court must deny Aramco's motion. Thus, Lefrak would have the jury determine the ultimate legal issue of the case.
The court finds that it must grant Aramco's motion for summary judgment. Lefrak's simple, broad and conclusory allegations, despite the persistence of Lefrak's urgings, are insufficient to overcome that motion. After five years of almost continuous activity, every avenue of discovery has been exhausted. Yet, the facts before the court indicate that Lefrak was an indirect purchaser who did not buy fuel oil through pre-existing cost-plus contracts. Accordingly, Lefrak cannot prevail, as a matter of law, under the principles of Illinois Brick. Any prior reluctance of this court to dismiss pursuant to Fed.R.Civ.P. 12(c) has disappeared in light of the long period of discovery and Lefrak's inability to demonstrate a factual basis for its claim sufficient to raise a material issue of fact.
I. THE FACTUAL BACKGROUND
Lefrak is a group of large housing complexes which does business in the New York City metropolitan area. During the years 1968 to 1974 it purchased heating oil to fuel the furnaces in the housing complexes.[4]
Aramco represents the large oil suppliers ("suppliers") who supply the national market for petroleum products at the top end of the distribution chain. Aramco's heating oil market includes direct wholesale distribution to distributors, and in turn, indirectly includes a retail market between distributors and consumers. Through a complex process, it obtains oil from foreign oil producers ("producers").[5] Aramco converts its purchase and business costs into a marketing price and offers its products to independent distributors who resell it on the retail market.[6]
During the period in question, Lefrak consumed between 11 million and 15 million *812 gallons of oil for each of the relevant years. These large quantities made Lefrak an unordinary consumer. As a result, Lefrak entered into large quantity contracts of a requirements nature to insure a steady supply of heating oil at a predictable and cost-efficient price.
Lefrak had four major distributors. They were Whaleco Fuel, formerly known as Whale Oil ("Whaleco"), Howard Fuel ("Howard"), Premium Coal & Oil ("Premium") and Castle Coal & Oil ("Castle"). These distributors purchased their fuel oil from suppliers on the open market, and resold the oil to Lefrak pursuant to contract. Thus, a distribution chain, marked by independent and readily definable levels, existed beyond the production stage. For this case, that distribution chain is as follows:
[7]
The facts before the court lead to certain conclusions about the distribution process. First, Aramco did not supply Lefrak and Lefrak did not purchase directly from Aramco. Rather, an intermediate link existed in the distribution chain between the oil suppliers and the oil consumers. Second, the oil suppliers dealt at arms length with the distributors. The distributors were not owned or controlled by the producers, and were free to set prices with their customers on the basis of their own profit goals and cost demands. Where one distributor was unwilling or unable to meet a customer's supply needs or price demands, there was a competing distributor ready to fill the gap in the market structure. See e. g. Plaintiff's Exhibits Vol. II, Carini Affidavit ¶ 13. Thus, the distributor's price to its customer was a result of an independent decision in a competitive market.[8]
Lefrak's consumption of oil and its relationship to this distribution chain is reflected in its contracts with the distributors during the years 1968-1974. Both Lefrak and Aramco point to those contracts but give different interpretations of them and draw different conclusions from them. Since the court's understanding of the contractual terms and meanings and their relationship to the market structure will be decisive, the court must focus on those contracts.
In a sense, the Lefrak contracts represent a return to the "good old days" when oil supplies seemed plentiful and prices incredibly low by present standards. Those contracts reflect an enviable pattern of stable supply and price which was interrupted by the 1973 oil embargo induced by the foreign oil producers. The post-1973 contract reflects the market changes, and an emphasis in the Lefrak organization on the efficient use of fuel oil. Despite the apparent simplicity of the contracts or the availability of supply in a stable market, however, the facts before the court indicate that hard negotiation and practical concerns were a benchmark for those contracts. It is important to remember throughout that Lefrak was a large consumer, and his concerns and demands were not those of a consumer on a small scale. A review of the combined exhibits will demonstrate the considerations which shaped the provisions of the contracts.
Lefrak contracted for large quantities of fuel oil. For the period 1967 to 1971 Lefrak contracted with the Whale Oil Company for an unspecified quantity of fuel oil for each of the four contract years, and in fact purchased a large quantity. For the period 1971 to 1972 Lefrak contracted with Premium for approximately 6 million gallons of fuel oil, and with Howard Oil for a similar *813 amount but at a different price[9] and under different terms. For the period 1972-73 Lefrak contracted with Whaleco for approximately 15 million gallons of fuel. For the period 1973-1974 Lefrak contracted with Castle for approximately 8 million gallons of fuel, and with Whaleco for approximately 7 million gallons but at a higher price.[10] In any given year, Lefrak required approximately 12 million gallons, and its contracts reflect that approximate consumption.[11] Lefrak contracted with those distributors which could guarantee supply at a favorable price.[12] Deft. App. Vol. II at 27-37.
Lefrak and its distributors also set pricing terms in their contracts. Both Lefrak and the distributors agreed to use either the Exxon Consumer New York Harbor barge price ("Exxon" or "barge price") or the Shell Asiatic New York Cargo Price ("Shell" or "barge price") as a reference point in the marketplace. These price indexes were readily available to the public in the New York Journal of Commerce or Platt's Oilgram, two industry journals. As to price, the contracts indicate that a price was set to cover the cost of the product. Some contracts specified an additional charge to cover profit, transportation and overhead.
The contracts also provided that the price of the fuel oil would rise or fall according to increases or decreases in the posted barge price. While the pre-1971 contracts did not indicate a limit on the amount of the increase, the post-1971 contracts indicate that a limit of 95% of the increase would be added to the price of the product. No provision was made concerning the amount of decrease in price, although pro-rata reduction provisions were included in some contracts.
The barge prices, however, were not invariably tied to actual prices and costs. They were instead an indicator used by the parties to estimate costs and negotiate prices. Defendant's Reply App. Exh. A, B. Thus, the ultimate contract prices were not identical to the posted barge prices. This was because different pressures came to bear on both suppliers and distributors in *814 their respective positions in the marketplace. A supplier's costs and prices could vary from the posted barge price of another supplier which was used as a reference point for a contract. Similarly, the distributors were faced with economic conditions that could vary the actual price from the barge price. Thus, competitive edges and other business concerns allowed for variations in the prices ultimately placed in the contract and paid by Lefrak. Deft. Reply App. Exh. B.
Another reason for the fluctuations in price was the absence of any requirement in the industry to follow any barge price in reaching a contract price. Indeed, the barge price did not reflect the individual market positions of the distributors or suppliers. Contractual arrangements, though indexed to the barge prices as a bargaining and reference point, varied with market conditions and the bargaining position of the distributor and its buyer.[13] Deft. App. Vol. II 37-38; Deft. Reply App. Exh. A, B.
The relative simplicity of the contracts and the convenient indexing system for pricing are belied by the actual contract negotiations that continued throughout the contract period. Moreover, although the contracts were similar in general format, there were notable variations in some.
For example, the pre-1971 contracts with Whale included provisions which allowed Lefrak to purchase up to 2.5 million gallons of fuel oil at a price referenced to the contract price at the date of purchase. Thus, Lefrak could purchase and accept large quantities of oil and avoid the costs of subsequent increases.[14] Deft. App. II at 20. In the 1972-1973 period, Lefrak contracted to purchase its year's requirements from Whaleco. That contract differed from the others by setting a maximum annual price over which further increases would not be added. Thus, unanticipated price or cost increases created a risk of loss for the distributors. See Deft. App. Vol. II at 55-60.
The contracts were executed in a competitive market of large distributors. Each distributor negotiated with the suppliers on the price of the product. Thus, their purchase price was not inexorably tied to a prevailing barge price. Rather, the price varied with market conditions and bargaining strength.
In turn, Lefrak, as a large consumer, commanded a favorable bargaining position, which it used to its benefit. Thus, when Lefrak requested that the Exxon or Shell price be used as a reference point for negotiations, the distributors acceded to the request. When Lefrak expressed a desire for price accommodations, the distributors varied their pricing arrangements to meet its demands. Deft. Reply App. Exh. C.
Lefrak's ability to negotiate its prices was due largely to the competitive distributors' desire to gain the Lefrak contract. Deft. App. Vol. II. Thus, Lefrak negotiated for a price which it considered to be favorable. It also negotiated the actual price due under the terms of the contractual increases and sought to obtain a lower price. For example, Lefrak did not approve certain increases posted by Whaleco in 1974, and was successful in negotiating the increase downward, thereby avoiding a full pass-on of the increased fuel oil costs. Pltf. Exh. Vol. I, Exh. B; Deft. App. Vol. I, Exh. 23, 24, 25, 26.
Another example of Lefrak's bargaining position was Lefrak's ability to change distributors to its satisfaction. Thus, in 1974 Lefrak changed from Howard Fuel to Castle to gain a better price. Deft. App. Vol. I Exh. 6, 7, 8; Deft. App. Vol. II 101-102. In that year, Lefrak also switched from Castle *815 to Whaleco, and from Whaleco back to Castle in a very short period of time to gain a price and supply advantage. Deft. App. Vol. II 115-116. Thus, Lefrak negotiated its contracts independently with each distributor to gain the best service at the best price. As a result, the prices of fuel oil varied among the Lefrak distributors. Def. App. Vol. II at 118-119.
Lefrak also reserved the flexibility to seek other distributors for supply and price. (Pl. Vol. I Exh. A-1, A-2; Def. App. Vol. II 90-105). This was because Lefrak did not always meet the contractual approximation of gallonage, and was able to purchase elsewhere at a better price. (Deft. Reply App. Exh. C)
Thus, the surface clarity of the contracts is belied by the extensive negotiations conducted by the parties throughout the contracts' existence. Lefrak's position in the market allowed it to negotiate the contracts and maintain a favorable and flexible position in the marketplace. As a result, Lefrak could change distributors, purchase in addition to its contracts, and get a price that was not unalterably tied to the Lefrak-preferred barge price. Thus, it appears throughout that Lefrak's position in the market produced a favorable, if not timid, response from its distributors who sought to maintain a lucrative account. (Deft. Reply App. Exh. C) As a result, the distributors were placed in a dilemma. They could either negotiate the price downward and thereby lessen their profits and increase their risk of loss by unexpected price increases or they could maximize profits and increase prices and lose a lucrative account that sought usually one or two distributors to supply the bulk of its needs. Thus, Lefrak's market position placed it in a good position at the expense of and with risk to the distributors.
II. THE LAW OF SUMMARY JUDGMENT
The principles of law applicable to a motion for summary judgment are well established. The movant must demonstrate that there is no genuine issue of material fact. Fed.R.Civ.P. 56(c).
[T]he "fundamental maxim" remains that on a motion for summary judgment the court cannot try issues of fact; it can only determine whether there are issues to be tried . . . Moreover, when the court considers a motion for summary judgment, it must resolve all ambiguities and draw all reasonable inferences in favor of the party against whom summary judgment is sought . . . with the burden on the moving party to demonstrate the absence of any material factual issue genuinely in dispute . . ..
Heyman v. Commerce and Indus. Ins. Co., 524 F.2d 1317, 1319-20 (2d Cir. 1975). See also Ambook Enterprises v. Time, Inc., 612 F.2d 604 (2d Cir. 1979).
This is not to say that the non-moving party may remain idle. Simple, conclusory statements alleging the existence of a factual issue are insufficient to defeat a motion for summary judgment. Donnelly v. Guion, 467 F.2d 290, 293 (2d Cir. 1972). The opposing party cannot withhold its evidence until trial. Rather, it must come forward with specific evidence to support its claim of a factual issue. Beal v. Lindsay, 468 F.2d 287 (2d Cir. 1967); Donnelly v. Guion, supra.
Moreover, the court is mindful of the restricted role that summary judgment usually plays in antitrust matters. Poller v. Columbia Broadcasting, 368 U.S. 464, 473, 82 S.Ct. 486, 491, 7 L.Ed.2d 458 (1962). However, even in an antitrust action, Rule 56 does not "permit plaintiffs to get to a jury on the basis of the allegations in their complaints, coupled with the hope that something can be developed at trial in the way of evidence to support those allegations . . ." First National Bank of Arizona v. Cities Service Co., 391 U.S. 253, 290, 88 S.Ct. 1575, 1593, 20 L.Ed.2d 569 (1968). Rather,
While we recognize the importance of preserving litigants' rights to a trial on their claims, we are not prepared to extend those rights to the point of requiring that anyone who files an antitrust complaint setting forth a valid cause of action *816 be entitled to a full-dress trial notwithstanding the absence of any significant probative evidence tending to support the complaint.
391 U.S. at 290, 88 S.Ct. at 1593. Thus, "courts should not be unduly reluctant to grant summary judgment when a trial would serve no useful purpose and the movant is entitled to judgment as a matter of law." 6 Moore's Federal Practice ¶ 56.02(i) at 56-25.
Thus, this court should grant a motion for summary judgment only when the record demonstrates a compelling factual situation in the setting of a controlling legal principle. That is the situation here. The parties have actively pursued this matter for five years. The exhibits submitted by both sides are substantially the same. Indeed, the controlling contracts are submitted by the defendants to disprove the plaintiff's case, while the plaintiff offers them to bolster its case against the defendants.[15] Accordingly, the court finds that under the circumstances of fact and law before it, summary judgment in favor of the defendants is appropriate.
III. THE RULE OF ILLINOIS BRICK
A discussion of the ruling set forth in Illinois Brick Co. v. Illinois, 431 U.S. 720, 97 S.Ct. 2061, 52 L.Ed.2d 707 (1977), must be considered in light of Hanover Shoe, Inc. v. United Shoe Machinery Corp., 392 U.S. 481, 88 S.Ct. 2224, 20 L.Ed.2d 1231 (1968). In Hanover Shoe, the plaintiff shoe manufacturer sued the defendant shoe machine manufacturer for antitrust violations. In defense of that action, the defendant argued that the plaintiff suffered no legal harm because it was able to "pass-on" the overcharges to the ultimate consumer. The Court rejected this argument and held that the pass-on defense was unavailable, as a matter of law, to a seller sued by its direct purchaser for anti-trust damages.
In so holding, the Court allowed the direct purchaser of an overcharged product to sue regardless of whether he passed-on the amount paid for the overcharges. It justified its result by pointing to the damages a direct purchaser was likely to suffer when placed in the position of an intermediary between a controlling seller and a demanding buyer. The Court stated:
If in the face of the overcharge the buyer does nothing and absorbs the loss, he is entitled to treble damages. This much seems conceded. The reason is that he has paid more than he should and his property has been illegally diminished, for had the price paid been lower his profits would have been higher. It is also clear that if the buyer, responding to the illegal price, maintains his own price but takes steps to increase his volume or to decrease other costs, his right to damages is not destroyed. Though he may manage to maintain his profit level, he would have made more if his purchases from the defendant had cost him less. We hold that the buyer is equally entitled to damages if he raises the price for his own product. As long as the seller continues to charge the illegal price, he takes from the buyer more than the law allows. At whatever price the buyer sells, the price he pays the seller remains illegally high, and his profits would be greater were his costs lower.
392 U.S. at 489, 88 S.Ct. at 229. Thus, the Court chose to avoid punishing a purchaser who sought to maintain his business through price and cost adjustment. Accordingly, the Court held as a matter of law that where such a purchaser is not insulated from the effects of the overcharges, he can sue for damages.
*817 The Court opted for a practical result. It recognized that the defense would complicate litigation and lead to unduly burdensome factual issues.
We are not impressed with the argument that sound laws of economics require recognizing this defense. A wide range of factors influence a company's pricing policies. Normally the impact of a single change in the relevant conditions cannot be measured after the fact; indeed a businessman may be unable to state whether, had one fact been different (a single supply less expensive, general economic conditions more buoyant, or the labor market tighter, for example), he would have chosen a different price. Equally difficult to determine, in the real economic world rather than an economist's hypothetical model, is what effect a change in a company's price will have on its total sales. Finally, costs per unit for a different volume of total sales are hard to estimate. Even if it could be shown that the buyer raised his price in response to, and in the amount of, the overcharge and that his margin of profit and total sales had not thereafter declined, there would remain the nearly unsuperable difficulty of demonstrating that the particular plaintiff could not or would not have raised his prices absent the overcharge or maintained the higher price had the overcharge been discontinued. Since establishing the applicability of the passing-on defense would require a convincing showing of each of these virtually unascertainable figures, the task would normally prove insurmountable.
392 U.S. at 492-93, 88 S.Ct. at 2231. In so holding, the Court decided against a posture that would result in a situation where no buyer could recover for the illegal overcharges. 392 U.S. at 494, 88 S.Ct. at 2232. Thus, the court determined, as a matter of antitrust policy, that a viable class of direct purchasers should be allowed to sue for damages.
In Illinois Brick Co. v. Illinois, supra, the Court was faced with a situation where the indirect purchasers of a product sought to sue the manufacturers for overcharges. Thus, the plaintiffs represented that class of purchasers to whom the defendants in Hanover Shoe attributed the passed-on costs of the overcharges. The Court held that those indirect purchasers could not sue to recover the overcharges passed on to them. 431 U.S. at 728-29, 97 S.Ct. at 2065-2066.
The Court relied upon its analysis in Hanover Shoe to reach that result. The court considered the practical problems of proof which would follow an attempt to delineate the costs actually incurred and passed-on through the distribution chain. 431 U.S. at 732-33, 97 S.Ct. at 2067-2068. Accordingly, the Court refused to abandon its former policy decision to limit the class of plaintiffs to direct purchasers of price-fixed goods. 431 U.S. at 736, 97 S.Ct. at 2069.
That Lefrak was an indirect purchaser requires but a cursory review.[16] The distribution chain in existence for the fuel oil market demonstrates that Lefrak purchased its fuel oil requirements directly from an intermediate level of distributors. Those distributors, in turn, purchased their supplies from other distributors or the suppliers. See, e. g., Deft. Reply App. Exh. C; Deft. App. Vol. III. Thus, before Lefrak purchased the fuel oil, the oil had already entered the market at the wholesale level, and was at least one step removed from Lefrak. By the time the product reached Lefrak, the distributors had made their purchases, calculated their costs and profits, and prepared to enter the retail market for resale to their customers. Thus, the distribution process here closely resembles the distribution process noted by the Court in both Hanover Shoe and Illinois Brick. As a result, Lefrak is rendered an indirect purchaser under those decisions, and is precluded from maintaining an antitrust action.
*818 IV. EXCEPTIONS TO ILLINOIS BRICK
While the decisions in Hanover Shoe and Illinois Brick represented a strict rule of law barring suit by a large class of potential plaintiffs, the decisions recognized two potential exceptions to that rule. Those exceptions permit an indirect purchaser to sue for damages when one of the links in the chain of distribution is "owned or controlled by" another link and when there exists a "pre-existing cost-plus contract" between a direct and indirect purchaser. The motion before the court raises the applicability of those exceptions to the situation here.[17]
A. The "Owned or Controlled by" Exception
In Illinois Brick, the court noted that where "market forces have been superseded" because the "direct purchaser is owned or controlled by its customer," an indirect purchaser may sue to recover damages. 431 U.S. at 736 n. 16, 97 S.Ct. at 2070. Thus, if Lefrak could demonstrate that the distributors' intermediary position in the distribution chain was emasculated by the ownership or control by Aramco, it could avoid the effect of the indirect purchaser rule.[18]
The facts before the court clearly indicate that Lefrak is not entitled to invoke this exception. The distributors acted independent of their suppliers, and made contract and pricing decisions according to their individual concerns. This lack of ownership or control is amply supported by the exhibits presented to the court.
For example, the distributors were in a competitive industry, marked at times by "cutthroat" competition. Pltfs. Exh. Vol. II Carini Affidavit ¶ 13; Deft. Reply App. Exh. B at 102; Deft. Reply App. Exh. C at 72. Their pricing decisions were not controlled by defendants but were the result of individual considerations. Deft. Reply App. Exh. A, B, C. Moreover, the barge prices did not invariably represent the prices to be charged by the distributors. The actual prices used depended on factors independent of the suppliers' price lists. Deft. Reply App. A, B, C; Deft. App. Vol. III. Lefrak itself was a motivating force in the use of that pricing system. Deft. App. Vol. II 16-21, 25; Deft. Reply App. Exh. A at 62. More importantly, Aramco did not compel the use of such a reference price and did not control the actual prices charged by the distributor. Deft. Reply App. Exh. B, C.
The court finds that there is a patent lack of evidence to demonstrate a material issue of fact concerning Aramco's ownership of or control over the distributors. Accordingly, Lefrak is not entitled to rely upon this exception as a matter of law.
B. The Pre-Existing Cost-Plus Contract Exception
The Supreme Court in both Hanover Shoe and Illinois Brick recognized a narrow exception to its rule where the direct purchaser "passed-on" all of his overcharges directly and invariably to the indirect purchaser pursuant to a "pre-existing cost-plus contract." Hanover Shoe recognized the cost-plus contract exception since, under that limited situation, it would be "easy to prove that [the direct purchaser] has not been damaged." 392 U.S. at 494, 88 S.Ct. at 2232.
In Illinois Brick, the Supreme Court clarified Hanover Shoe's enunciation of the cost-plus exception. First, it is clear that the Supreme Court envisioned that the exception would be narrowly construed. The Court permitted a suit to be maintained by an indirect purchaser only where he established the presence of a pre-existing cost-plus contract which circumvented complex *819 market interactions. It was conceded in both Hanover Shoe and Illinois Brick that the doubtfulness of the economic connection between the initial overcharge and the price paid by indirect purchasers, coupled with the complex problems of proof of such passing on of the overcharge, necessitated the development of limitations on the extent to which such speculation could be tolerated. 431 U.S. at 732, 97 S.Ct. 2061; 392 U.S. at 492-93, 88 S.Ct. at 2231. See generally "Comment, In the Face of Uncertainty The Passing-On Concept in Civil Antitrust Litigation," 27 Ark.L.Rev. 83, 110 (1973).
A pre-existing cost-plus contract, however, provides a formula for the automatic determination of those prices and excess costs which are passed-on. It thereby eliminates the cumbersome problems of proof needed to determine the damages attributable to a reduction in the direct purchaser's sales. The cost-plus contract insulates the direct purchaser from any decrease in its sales as a result of a pass-on of the overcharge because its customer is committed to buying a fixed quantity regardless of price. 431 U.S. at 736, 97 S.Ct. at 2069. See generally Schaefer, "Passing-On Theory in Antitrust Treble Damage Action: An Economic and Legal Analysis," 16 Wm. & Mary L.Rev. 883 (1975). Fixed quantity thus involves a relationship whereby a party is locked into buying a fixed amount regardless of price fluctuations and with no recourse in the open market for buying a greater or lesser quantity at competitive prices. In this way, the effect of the overcharge is "determined in advance, without reference to the interaction of supply and demand." 431 U.S. at 736, 97 S.Ct. at 2070.
The effects of such a contract are clear. The direct purchaser who resells under such a contract is necessarily insulated from any harm which might occur due to increases in price and cost. Any overcharges incurred by him are simply passed-on in their entirety. Similarly, the indirect purchaser's demand for the product is completely inelastic because the indirect purchaser must buy the same quantity at one price, even though the price may vary with the direct purchaser's cost.[19] Schaefer, supra, at 892. As a result of the interaction thus imposed by the contract, the amount of the overcharges passing through one stage of the distribution chain to the next is apparent. On the other hand, where a fixed quantity does not exist, and an indirect purchaser is free to vary the amount of its purchases in response to price changes, the evidentiary problems incident to allocating the amount of the overcharges arise.
The cost-plus contract exception is thus a fragile principle grounded in law and economics. In essence, the exception involves three essential elements; first, that there exists an automatic pass on to the full extent of the overcharge to indirect purchasers; second, that the direct purchaser is insulated from any decrease in sales or profit; and third, that a contract exists which commits the indirect purchaser to buying a fixed quantity regardless of price. See generally Mid-West Paper Products Co. v. Continental Group, Inc., 596 F.2d 573 (3d Cir. 1979); Abbotts Dairies Division of Fairmont Foods, Inc. v. Butz, 584 F.2d 12 (3d Cir. 1978); Beckers v. International Snowmobile Industry Assoc., AMF, Inc., 581 *820 F.2d 1308 (8th Cir. 1978); United States v. Consolidated Edison Co. of New York, Inc., 580 F.2d 1122 (2d Cir. 1978); In re Fertilizer Antitrust Litigation, 19792 Trade Cas. ¶ 62,894 (E.D.Wash.1979); City of Mishawaka, Indiana v. American Electric Power Co., Inc., 465 F.Supp. 1320 (N.D.Ind.1979); Eastern Airlines, Inc. v. Atlantic Richfield Co., 470 F.Supp. 1050 (S.D.Fla.1979); Philadelphia Housing Authority v. American Radiator & Standard Sanitary Corp., 50 F.R.D. 13 (E.D.Pa.1971), aff'd per curiam, Mangano v. American Radiator & Standard Sanitary Corp., 438 F.2d 1187 (3d Cir. 1971); City and County of Denver v. American Oil Co., 53 F.R.D. 620 (D.C.Colo.1971). Thus, the cost-plus exception has been found to mean that the purchaser-seller's profit is guaranteed and controlled by a contract rather than by relatively unascertainable economic conditions. Under such circumstances, the overcharge must be passed-on automatically to the buyer with whom the purchaser-seller has his cost-plus contract and the quantity of sales and profits must remain constant despite the overcharge.[20]Abbotts Dairies Division of Fairmont Foods, Inc. v. Butz, supra at 16.
On the basis of the record before it, the court finds that Lefrak's ability to negotiate with its distributors, Lefrak's ability to change distributors on the basis of its business concerns, Lefrak's flexibility in purchasing quantities of fuel oil as needed, and the consequent loss of profits which befell the distributors, in toto, negate the existence of a contract which locked the consumer into buying a fixed quantity regardless of price, and which insulated the middlemen from financial injury. The court will discuss the factors seriatim.
The Automatic "Pass On"
The existence of a pre-existing cost-plus contract allows a precise determination of the excess costs passed on and avoids a determination of damages attributable to a reduction in the direct purchaser's sales. Cf. Yoder Bros. v. California Florida Plant Corp., 537 F.2d 1347 (5th Cir. 1976). For this to occur, the middlemen, or the oil distributors in this case, must adhere to a rigid pricing formula such that the entire overcharge is undeviatingly passed on to Lefrak without reference to the forces of the marketplace. Illinois Brick, supra, 431 U.S. at 736, 97 S.Ct. at 2069; Mid-West Paper Products Co. v. Continental Group, supra at 577.
The voluminous record before the court belies any notion of an automatic pass-on of the alleged overcharges. Lefrak explains that the contractual price terms were set in relation to the Exxon barge price or the Shell barge price. The price of fuel oil, *821 therefore, would rise or fall according to increases or decreases in the posted barge price. This purportedly automatic pricing mechanism enabled the distributors to pass on overcharges from the suppliers in their entirety and insulated the distributors from any decrease in sales.
According to the distributors, however, their resale prices were not based on a rigid formula and did not even meet their actual costs. Defts. Reply App. Exh. A, B, C. Mr. Ross of Premium testified that his company was not purchasing the oil at the barge price. Actual costs for No. 6 fuel oil were determined by negotiation with the actual suppliers and depended on a number of market variables. See, e. g., Ross Afft., ¶ 6. Yet, a pre-existing cost-plus contract presupposes a resale price based upon a fixed percentage of the direct purchasers' actual costs or average total cost of the product so that any increased charges are passed on to the indirect purchaser with precision and without loss of sales to the direct purchaser.
Here, however, the distributors were not mere conduits, automatically passing on actual price increases. The contracts between Lefrak and the distributors represented the fruition of business acumen and competitive forces. Lefrak was no lilliputian in the marketplace. In fact, the record indicates that the distributors were most desirous of gaining the Lefrak contract. For example, several of the Lefrak contracts with Whale Oil, Whaleco and Premium provided for maximum increases to Lefrak, regardless of increased costs to the distributors. Defts. App. Vol. I, Exh. 12, 14, 17. Thus, when there was an increase in actual costs to Premium during the duration of the contract period with Lefrak, Premium could not pass on that increase. Defts. Reply App. B. In reality, the distributors were forced to absorb the price differential which indicates that the distributors' profits were diminished by their increased costs. The distributors were, therefore, the proper parties injured which concomitantly creates a serious risk of multiple liability if offensive use of pass on is permitted under these facts. See Hanover Shoe, supra 392 U.S. at 489, 88 S.Ct. at 2228.
The contractual pricing formula used in the Lefrak-distributor contracts, could not even be deemed a cost-plus equivalent since there was no strict adherence to a rigid formula which would avoid duplicative recoveries and complex damage apportionment. Mr. Klein of Lefrak testified that Lefrak, as a prudent buyer, sought to use the posted barge prices as a barometer from which one could negotiate price. "A prudent buyer would try to stabilize his price and have some base upon which to negotiate a price, otherwise you would be at the whim of the marketplace." Defts. App. II at 25. Thus, it is evident, that the parties used the barge prices as mere indicators to estimate cost and negotiate price. Defts. Reply App. Exh. A, B; Pltf. App. Vol. I, Exh. B.
How could there exist a rigid adherence to a pricing formula which would insulate distributors from any decrease in sales, when Lefrak's efforts to renogtiate distributor price increases downward proved successful? The Lefrak organization never accepted distributor price increases as gospel without first seeing the distributors and "trying to negotiate the price downward." Defts. App. Vol. I, Exh. 1. According to voluminous documentation, Lefrak often was successful in renegotiating to its advantage the distributors' initial pricing determinations. Pltf. App. Vol. I, Exh. B; Defts. App. Vol. II, at 141, 203. By way of example, Lefrak was able to negotiate downward an announced price increase by Whaleco in 1974. Defts. App. Vol. I, Exh. 24, 25. Lefrak had similar success with Castle. Defts. App. Vol. I, Exh. 26. Such negotiations necessarily were translated into savings for plaintiff and losses for the distributors. Unlike the situation present in a pre-existing cost-plus contract where excess costs are determined precisely and a complex division of damages is avoided, the apportionment of damages between Lefrak and the distributors rests upon an analysis of the negotiation process and the vagaries of the market.
*822 The record demonstrates beyond peradventure that Lefrak was able to avoid a full pass on of the increased fuel oil costs, Pltf. App. Vol. I, Exh. B. Specifically, Lefrak was able to change distributors in an effort to get the best possible price. Pltf. App. Vol. I, Exh. A-1, A-2; Defts. App. Vol. II, at 102; Defts. App. Vol. II, at 115-116. Such maneuvers do not represent pre-determined control of market forces, but reflect the dynamics of the marketplace with consequent increases and decreases in sales, costs and profits.
Such possibilities of free business dealings militate against a finding that actual costs were automatically passed on to the indirect purchaser without reference to the interaction of supply and demand. In reality, the existence of price negotiations and the strong bargaining position of Lefrak indicate not only that the distributors absorbed part of the alleged overcharge, but also that any attempt to allocate damages a fortiori would inject massive evidence and complicated theories into the proceedings.
Injury to the Direct Purchaser
The existence of maximum price contracts, renegotiations in price and changes in the choice of supply resulted in the absorption of both costs and reference price increases by the distributors. This situation is in contradistinction to the mandate of Illinois Brick which envisions the purchaser as fully insulated from any decrease in sales. Illinois Brick, supra, 431 U.S. at 736, 97 S.Ct. at 2069. Here, the record clearly demonstrates that the middlemen were harmed. Defts. Reply App. Exh. C; Defts. App. Vol. II, at 55-60. Since there was no automatic, undeviating pass-on, unanticipated price increases created a risk of loss for the distributors. Defts. App. Vol. II, at 55-60. That loss was realized when the distributors were precluded from basing the Lefrak contracts on actual costs for No. 6 fuel oil. Defts. Reply App., Exh. C; Defts. App. Vol. I, Exh. 24, 25. Similarly, when Lefrak changed distributors to find a fair price, the middlemen necessarily lost sales volume. Defts. App. Vol. I, Exh. 2, 5.
Thus, as the court noted in Hanover Shoe, supra, 392 U.S. at 489, 88 S.Ct. at 2229, the overcharges punished a middleman who attempted to achieve business efficiency. Similarly, here, the suppliers and Lefrak caused the distributors to operate efficiently by reducing costs, cutting prices and otherwise seeking to gain a competitive advantage over the other distributors. In effect, the most efficient distributor was the one able to cut costs and price increases to an extent favorable to Lefrak. By so acting, it is evident that the distributors were harmed, and represent a potential class of plaintiffs. Thus, it is clear, that a complete pass-on without injury to the distributors could not occur.
Fixed Quantity Contract
Lefrak strained to come forth with facts demonstrating fixed quantity contracts. Nowhere, however, is it able to present contracts which lock Lefrak into buying a fixed quantity regardless of price fluctuations in the market. Indeed, the contracts expressly permitted Lefrak to buy from other distributors so as to take advantage of more favorable prices. Pltf. App. Vol. I, Exh. A-1, A-2; Defts. App. Vol. I, Exh. 2; Defts. Reply App., Exh. C.
The feasibility exercised by Lefrak in renegotiating prices and changing suppliers destroyed any opportunity of the distributors to insulate themselves from decreases in sales. Pltf. App. Vol. I, Exh. B. Thus, Lefrak's ability to deal with several suppliers enabled it to shift its volume requirements as pricing policy dictated. Defts. App. Vol. II, at 101-02; Defts. Reply App., Exh. C.
Lefrak's contracts contained only approximate quantities to be purchased. Klein, Dec. 4 Afft. ¶ 3. A fixed quantity commitment is, however, essential to establishing the cost-plus exception. See, e. g. Mid-West Paper Products Co. v. Continental Group, Inc., 596 F.2d 573 (3d Cir. 1979); City of Mishawaka, Indiana v. American Electric Power Co., Inc., 465 F.Supp. 1320 (N.D.Ind.1979).
Further, Lefrak's needs were not predetermined but fluctuated with the *823 quality of oil used and the severity of weather conditions. Pltf. Exh., Dec. 7, 1979, Klein Aff., Exh. A. Finally, Lefrak's purchases of heating oil voluntarily declined from 1973 to 1974 because of a conservation program instituted by plaintiffs to counteract bleak market conditions. Defts. Exh., Dec. 10, 1979, at 7. Thus, Lefrak was not committed to buying a fixed quantity regardless of price.[21]
In conclusion, the court has taken into account all the exhibits submitted and concludes that no pre-existing cost-plus contract existed between Lefrak and the distributors. First, there was no automatic pass-on of the overcharge by suppliers to the indirect purchasers, Lefrak. Second, the distributors unequivocally suffered damage and absorbed an undetermined amount of excess costs. Third, no fixed quantity contract existed since the indirect purchasers were not locked into buying a fixed amount regardless of price. Price was at all times a relevant factor in the business decisions of the parties even after the contracts were consummated. Accordingly, Lefrak is not entitled, as a matter of law, to rely upon a pre-existing cost-plus contract exception. Its federal antitrust claims are dismissed. Illinois Brick Co. v. Illinois, supra.
V. REMOTENESS
While summary judgment is granted sparingly in antitrust cases, Poller v. Columbia Broadcasting, 368 U.S. 464, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962), it is equally clear that a plaintiff in a civil antitrust action must establish a clear causal connection between the violation alleged and the injuries allegedly suffered. Salerno v. American League of Professional Baseball Clubs, 429 F.2d 1003 (2d Cir. 1970), cert. denied, 400 U.S. 1001, 91 S.Ct. 462, 27 L.Ed.2d 452 (1971). Now, after five years of discovery, the plaintiffs must bridge the gap between the acts alleged and the injury claimed.
Plaintiffs contend that the defendants have conspired through joint ventures such *824 as the Iranian Consortium to control the supply of crude oil and thereby to charge monopoly prices for petroleum products. These monopoly prices were paid by plaintiffs when they purchased No. 6 heating oil at defendants' posted prices. Plaintiffs, in their Memorandum of Law dated November 15, 1979 and at oral argument on November 16, 1979 claimed that this illegal conspiracy and its direct effect on New York heating oil prices can and will be proved through defendants' conduct, ventures and pricing policy.
Mere allegations that the plaintiffs are not indirectly injured but directly harmed, do not clarify the issue of whether Lefrak is the proper party to bring suit. While antitrust violations create entirely foreseeable ripples of injury which disrupt the general economy, it is acknowledged that not all of those parties injured have the requisite standing to sue for treble damages. Billy Baxter, Inc. v. Coca-Cola Co., 431 F.2d 183 (2d Cir. 1970), cert. denied, 401 U.S. 923, 91 S.Ct. 877, 27 L.Ed.2d 826 (1971). The standing concept thus helps to control the floodgates to excessive litigation which threaten general business behavior. Laurie Visual Etudes, Inc. v. Chesebrough-Pond's Inc., 473 F.Supp. 951 (S.D.N.Y. 1979). Further, the concept of remoteness, by restricting the type of litigant who can sue in an antitrust case, reinforces, and in turn, finds support in, the principle of Illinois Brick. Consequently, a plaintiff must allege a causative link to his injury which is "`direct' rather than `incidental' or which indicates that his business or property was in the `target area' of the defendant's illegal act." Billy Baxter, Inc. v. Coca-Cola Co., supra at 187.
The necessity to limit the class of potential antitrust plaintiffs results from the fact that the damage to remotely situated persons is much more speculative and difficult to prove than the injury which befalls a competitor. Calderone Enterprises Corp. v. United Artists Theatre Circuit, Inc., 454 F.2d 1292 (2d Cir. 1971), cert. denied, 406 U.S. 930, 92 S.Ct. 1776, 32 L.Ed.2d 132 (1972). Rules of standing thus serve to exclude remote parties with possibly speculative injuries. See generally Nassau County Ass'n of Ins. Agents, Inc. v. Aetna Life & Cas. Co., 419 U.S. 968, 95 S.Ct. 232, 42 L.Ed.2d 184 (1974); GAF Corp. v. Circle Floor Co., Inc., 463 F.2d 752 (2d Cir. 1972), cert. denied, 413 U.S. 901, 93 S.Ct. 3058, 37 L.Ed.2d 1045 (1973); Billy Baxter, Inc. v. Coca-Cola Co., 431 F.2d 183 (2d Cir. 1970), cert. denied, 401 U.S. 923, 91 S.Ct. 877, 27 L.Ed.2d 826 (1971).
Here, the complaint alleges a global conspiracy among oil suppliers which artificially raised the price of New York heating oil, thereby injuring plaintiff, a New York landlord.[22] The ripple effects incident to this alleged conspiracy could conceivably have an adverse effect on the business of Lefrak. However, Lefrak could not be considered the object of the alleged antitrust violation. Rather, Lefrak's injuries were the result of its relationships with other parties. Those who have suffered economic damage by virtue of their relationships with targets or intermediate non-targets, and who are not targets or are not directly injured, are precluded from suing for treble damages in a private antitrust action. Calderone Enterprises Corp. v. United Artists Theatre Circuit, 454 F.2d 1292 (2d Cir. 1971), cert. denied, 406 U.S. 930, 92 S.Ct. 1776, 32 L.Ed.2d 132 (1972); S.C.M. Corp. v. Radio Corp. of America, 407 F.2d 166 (2d Cir.), cert. denied, 395 U.S. 943, 89 S.Ct. 2014, 23 L.Ed.2d 461, rehearing denied, 396 U.S. 869, 90 S.Ct. 38, 24 L.Ed.2d 125 (1969); Productive Inventions, Inc. v. Trico Products Corp., 224 F.2d 678 (2d Cir. 1955), cert. denied, 350 U.S. 936, 76 S.Ct. 301, 100 L.Ed. 818 (1956).
*825 In conclusion, plaintiff, a New York landlord who purchased No. 6 heating oil, but not crude oil,[23] was not the target of the alleged conspiracy. Second, Lefrak did not establish a direct causative link to his injury. Accordingly, the global conspiracy allegations are dismissed.
VI. PENDENT JURISDICTION
Aramco's final contention concerns the four remaining causes of action which are based on pendent jurisdiction. Those causes of action are based on New York State law and allege violations of the Donnelly Act, General Business Law § 340, and intentional torts. Having dismissed the federal causes of action, this court must consider whether it should retain jurisdiction over those pendent state claims.
There is no dispute that the state law claims were based on pendent jurisdiction, having arisen out of a common nucleus of operative fact with the federal claims and being of such a nature that they would be tried together. United Mine Workers v. Gibbs, 383 U.S. 715, 86 S.Ct. 1130, 16 L.Ed.2d 218 (1966). Pendent jurisdiction is a matter of judicial discretion. United Mine Workers v. Gibbs, supra; Federman v. Empire Fire and Ins. Co., 597 F.2d 798, 809 (2d Cir. 1979); Naylor v. Case and McGrath, Inc., 585 F.2d 557, 561 (2d Cir. 1978).
Its justification lies in considerations of judicial economy, convenience and fairness to litigants; if these are not present a federal court should hesitate to exercise jurisdiction over state claims, even though bound to apply state law to them . . . Needless decisions of state law should be avoided both as a matter of comity and to promote justice between the parties, by procuring for them a surer-footed reading of applicable law. Certainly, if the federal claims are dismissed before trial, even though not insubstantial in a jurisdictional sense, the state claims should be dismissed as well. Similarly, if it appears that the state issues substantially predominate, whether in terms of proof, of the scope of issues raised, or of the comprehensiveness of the remedy sought, the state claims may be dismissed without prejudice and left for resolution to state tribunals. 383 U.S. at 726-27, 86 S.Ct. at 1139 (emphasis added).
Indeed, where, as here, the federal jurisdictional peg is lost because the federal claims are dismissed, the recommended procedure in this circuit is to dismiss the state law claims. Federman v. Empire Fire and Marine Ins. Co., supra at 809.
The court has balanced considerations of comity, fairness, judicial economy and especially the avoidance of unnecessary decisions of state law, and finds that it must dismiss the pendent state claims. Federman v. Empire Fire and Marine Ins. Co., supra at 809. The issues raised by the parties concerning state law are significant and should be left to the state courts for resolution. This is apparent by the fact that a lower state court decision, Russo & Dubin v. Allied Maintenance Corp., 95 Misc.2d 344, 407 N.Y.S.2d 617 (Sup.Ct.1978), has taken a position contrary to that expressed by Lefrak, and injurious to its Donnelly Act claims. Moreover, the parties will not be inconvenienced since all discovery completed here may be used in the state court action as well. Since it is proper for the Donnelly Act claims to be brought in the state courts, it follows naturally that the related intentional tort claims should be brought in the state courts as well.[24]
*826 Accordingly, the remaining state law claims are dismissed.[25]
VII. CONCLUSION
In a period when the prices for heating oil and gasoline are rising precipitously, this court is cognizant of the feelings of anger and frustration expressed by the nation's consumers. Throughout these times, the oil companies have been the object of the public's vilification. Indeed, each new price increase heightens the public outcry and brings forth new demands for governmental inquiry. In that setting, then, it may seem ill-advised and unsympathetic to render any decision against the consumers.
The court itself is not immune from the burdens placed upon it as a result of rising prices and an unstable market, and can relate to the pressures experienced by its fellow consumers. Yet, it is a hallmark of our Constitutional processes that all litigants are entitled to a full and fair determination based not on caprice or popular feeling, but on the law and merits of each case.
While the court recognizes that this is one of the nation's most significant private antitrust cases pending, it is constrained to follow the principles set forth in Illinois Brick. A policy determination which eliminates the barriers to suit that face an indirect purchaser now must come through legislative action and not judicial fiat. Indeed, the Senate Judiciary Committee is scrutinizing the rule of Illinois Brick,[26] and movement is underway to overrule both Illinois Brick and Hanover Shoe.
The Senate bill (S.300) now pending before the Committee on the Judiciary, would amend the federal antitrust laws to permit "consumers, businesses, and governments injured by antitrust violations to recover damages whether or not they have dealt directly with the antitrust violator."[27] The bill thus unravels the knot tied by the Supreme Court which limited the underlying substantive rights of most consumers.[28]
The Committee rejected the underlying premise of Illinois Brick and Hanover Shoe. Specifically, it maintained that the apportionment of damages among a multiplicity of antitrust plaintiffs is not too complex a task for the federal courts.[29] The Committee stressed that existing principles of fairness and just compensation will be furthered, not frustrated, by this legislation since victims of antitrust violations would *827 be compensated, conspiracies to restrain trade would be deterred and effective antitrust enforcement would be restored.
Thus, legislative activity is afoot to ensure that the central purpose of the antitrust laws is effectuated. As indicated in the Committee Reports, however, the federal courts today are constrained by the language of Illinois Brick. In a system based upon checks and balances between the different branches of governmental authority, this court must leave a determination concerning the efficacy of changing the policies behind the antitrust laws to the legislature.
The court finds on the facts and law before it that Lefrak is not entitled to recover as a matter of law. Accordingly, the Clerk of the court shall enter summary judgment on behalf of the defendants. This decision shall constitute the final order of this court.
SO ORDERED.
APPENDIX A
The contracts appended to this decision are representative of those entered between Lefrak and its distributors.[*] While these contracts were previously subject to this court's protective order, the decision rendered by the court dissipates the need for continued confidentiality.
*828
RIDER TO AGREEMENT DATED OCTOBER 10, 1973 BETWEEN CASTLE COAL & OIL CO., INC. & LEFRAK ORGANIZATION, INC.
1. Buildings to be supplied will be located in Brooklyn, Queens, Manhattan, Bronx, Staten Island and Mount Vernon, New York, but which may be deleted, substituted and/or added to at owner's option.
2. Terms of payment will be by invoices submitted and payment shall be made thirty (30) days net after the receipt of such invoices by the purchaser's Accounting Department. The buyer hereby states that because of its computerized system, some delays, at times, might occur. The buyer will make every effort to pay in accordance with the terms hereinabove mentioned, but the parties acknowledge that in no event will payments be made later than forty-five (45) days from the date of receipt of invoice.
It is understood that the failure of the purchaser to reasonably comply with these terms, as outlined, shall constitute a breach of the contract and the seller shall not be obliged to continue to perform hereunder.
3. Present oil being delivered is 0.3% maximum sulphur content as promulgated by the New York City Administrative Code. If the Exxon consumer New York harbor barge price of # 6 fuel oil changes, because the permissible sulphur content is changed (in accordance with government regulations), the price of the delivered #6 fuel oil shall be reduced by the change in the Exxon consumer New York harbor barge price for such increased sulphur content oil.
4. The parties hereto acknowledge the energy crisis and oil shortage. It is the owner's intention that its requirements for the period of this contract be met both as to supply and cost and, therefore, reserves on to itself the right to purchase oil from sources other than Castle, if such action should arise where buyer, in its own discretion, deems such action reasonable. Any such purchase of oil will not be deemed a breach or termination of this contract but rather in furtherance thereof.
5. Anything herein to the contrary notwithstanding, it is the intention of the parties that in the absence of any government action or intervention affecting the supply and/or price of oil, the buyer's position vis-a-vis any other customers of the seller shall in no way be prejudiced, excepting hospitals, nursing homes, schools, orphanages and any other institutions providing health and welfare care.
6. All deliveries will be made by certified metered trucks.
7. The purchaser will instruct its employees to place orders for oil at least forty-eight (48) hours prior to delivery. Castle, *829 however, in the event of emergency, will accept twenty-four (24) hour notice and will deliver promptly.
8. Price quoted herein is based on or within present Federal Phase 4 Guidelines.
NOTES
[1] The defendants are: Arabian-American Oil Company; Asiatic Petroleum Corporation; Exxon Corporation; Gulf Oil Corporation; Mobil Oil Corporation; Royal Dutch Petroleum Company; Shell Petroleum, N.V.; Standard Oil Company of California; Texaco, Incorporated; The Shell Petroleum Company, Limited; and The Shell Transport and Trading Company, Limited.
[2] Illinois Brick Co. v. Illinois, 431 U.S. 720, 97 S.Ct. 2061, 52 L.Ed.2d 707 (1977).
[3] The amended complaint alleges six causes of action. The first cause of action alleges a claim for damages and injunctive relief under the Sherman and Clayton Antitrust Acts, 15 U.S.C. §§ 1, 15, 26, on the grounds that the defendants conspired to fix the price of home heating oil. Count Two alleges a violation of 15 U.S.C. § 8. Counts Three and Six are based on pendent jurisdiction to the first two counts and allege a violation of New York State's Donnelly Act, New York General Business Law § 340. Counts Four and Five are also based on pendent jurisdiction and allege intentional tortious conduct.
[4] Although Lefrak purchased # 2 and # 4 quality fuel oil, the contracts which are the focus of the issues here were for # 6 quality fuel oil.
[5] While the effect of domestic oil production is apparently not in issue, the court will assume that the allegations of the complaint extend to it.
[6] Each supplier set its own price in different ways. The pricing process was complicated by place of purchase, supply, quality of product and demands of the market. Thus, the price of one supplier varied from the posted price of another supplier. [See Defendant Reply App. Exh. A].
[7] Under the facts of this case, the large quantities purchased by Lefrak indicate a strong bargaining position. Thus, the retail market which existed between Lefrak and the distributors most likely varied from the retail market in general.
[8] As will be apparent from the court's discussion, infra, Lefrak's argument that the distributors were fraudulently established by the oil suppliers in order to avoid the impact of Illinois Brick is belied by the fact that Illinois Brick was rendered after the distribution process was firmly established. While the oil suppliers have been called many things, this court is unwilling to call them clairvoyant.
[9] Arthur Klein, Lefrak's executive vice-president, indicated that a variation in a contract price of thousandths of a cent was significant and could account for sizable savings when millions of gallons were purchased. Deft. App. Vol. II at 31. Thus, he indicated the desirability of negotiating with many distributors to obtain the lowest price for a stable supply. Deft. App. Vol. II at 27-37.
[10] Lefrak was unable to determine its exact fuel requirements in advance of any given year. Although Lefrak's housing stock remained stable, and housing codes required a minimum temperature for the buildings, Lefrak's needs fluctuated with the quality of oil used and the severity of the weather conditions for any particular heating season. Pltf. Exh. Dec. 7, 1979, Klein Affidavit, Exh. B. Lefrak could, however, approximate its potential consumption by using the previous consumption for the same or similar housing stock. In that way, Lefrak could insure a continuous supply from its distributors.
[11] The consumption of fuel oil by Lefrak for the period in question was, in gallons, as follows:
1968 12,586,000
1969 12,474,000
1970 12,899,000
1971 12,947,000
1972 14,661,000
1973 13,446,000
1974 11,949,000
Pltf. Dec. 7, 1979, Exh. B-3.
In comparison, Lefrak contracted for the following:
(Contractual Provision)
1967-1968 unspecified
1968-1969 unspecified
1969-1970 unspecified
1970-1971 unspecified
1971-1972 12,000,000
1972-1973 15,000,000
1973-1974 15,000,000
[12] With the prospect of uncertain supplies due to the 1973 oil embargo, Lefrak reserved the right to purchase oil from other distributors in its 1973-74 contract with Castle (Plaintiff's Exhibits Vol. I, Exh. A-2), and reserved the right to purchase up to 4 million gallons of fuel oil from other distributors in its 1973-74 contract with Whaleco. Plaintiff's Exhibits Vol. I, Exh. A-1. Arthur Klein considered such clauses to be excellent hedges against the whimsy of distributors, and a way to insure flexible supplies. Deft. App. Vol. II. Similarly, the early Whale contracts did not specify a quantity to allow Lefrak to maintain flexibility in the market should better prices arise.
[13] The use of a supplier's barge price as a reference point for contract negotiations is apparently the result of custom and usage in the industry, and is a commonly used indicator. For example, in Merry Twins, Inc. v. Exxon Corp., 611 F.2d 874, No. 2-26 (Em.App. Dec. 19, 1979), the parties used the Texaco barge price as the reference point for their contracts.
[14] The risk being that the price of fuel oil could decrease, thereby causing Lefrak to pay more for the fuel oil. However, while there is no indication that Lefrak suffered due to these contractual agreements, it is clear that Whaleco was harmed by them and suffered substantial losses. Deft. Reply App. Exh. C, 80-81, 97-98.
[15] In First National Bank of Arizona v. Cities Service, supra, the Supreme Court affirmed the granting of a motion for summary judgment in an oil antitrust suit that had been pending for 11 years. Despite the plaintiff's protestations concerning discovery matters, and the waste of time inherent in a dismissal, the court rejected its arguments, 391 U.S. at 290-92, 88 S.Ct. 1575, and noted that,
[M]uch of the evidence obtained by the other defendants in deposing petitioner and his associates is relied on heavily by petitioner himself to bolster his case against Cities. Id. at 291, 88 S.Ct. at 1594.
The facts here present a more compelling situation in favor of granting the motion for summary judgment.
[16] Indeed, prior to this motion for summary judgment, it appeared that Lefrak necessarily abandoned this contention when this court allowed it to amend its complaint to bring it solely within the cost-plus contract exception.
[17] Other potential means for an indirect purchaser to bring suit are presented in Note, 63 Cornell L.Rev. 309 (1978). Since none of those situations apply to this case, the court will focus its attention on the two exceptions referred to above. The court notes, however, that the federal government and some state governments are conducting investigations into alleged overcharges, and are proceeding in parens patriae.
[18] There is no allegation that Lefrak owned or controlled the distributors.
[19] There is, in essence, perfect inelasticity of demand; the same quantity will be demanded regardless of price.
In a market where the demand is inelastic, the full burden of an excess charge is passed on to the buyer; after the shift of the supply curve from S to Sl, reflecting the increased costs incurred by the seller, the quantity demanded (Qo) remains the same. Thus, regardless of the price increases from Po to Pl, the same quantity is demanded with the result that the entire overcharge is shifted to the buyer. See generally P. Samuelson, Economics (10th ed. 1976).
[20] Some commentators, however, have admonished the courts to permit the use of passing on in situations that are the functional equivalent of the cost-plus contract. See, e. g., Note, "Recovery By Indirect Purchasers and The Functions of Antitrust Treble Damages," 55 Tex.L.Rev. 1445 (1978); Note, "Scaling The Illinois Brick Wall," 63 Cornell L.Rev. 309 (1978). Yet, even under a cost-plus equivalency test the policies of Illinois Brick must be promoted. Specifically, the overcharge must be determined in advance without reference to the interactions of supply and demand and the possibility of overlapping liabilities must be eliminated. In re Beef Industry Antitrust Litigation, 600 F.2d 1145 (5th Cir. 1979). Thus, where the prices between middlemen and consumers were derived directly and invariably from rates reported in a "yellow sheet" national news service which were compiled by a conspiracy of sellers wielding monopsony power, the Fifth Circuit found that the equivalent of a cost-plus contract existed. In re Beef Industry Antitrust Litigation, supra at 1154. However, the Fifth Circuit vividly defined the scope of that exception. First, it stated that plaintiffs were in no position to negotiate prices because they could not withhold a perishable product. In essence, the supply was inelastic. Second, the impact of the alleged overcharge was determined in advance without regard to the interactions of supply and demand. Id. at 1165. Third, the use of a predetermined formula to set price was rigidly adhered to and avoided any possibility of duplicative recoveries. Id. at 1165-66. Compare the use of the barge price by the distributors and Lefrak, infra.
[21] Lefrak's attempt to fit a general requirements contract into the pre-existing cost-plus contract exception is misplaced. The use of requirements contracts as a reasonably elastic means to provide for the long-term needs of a consumer is well-settled. See Uniform Commercial Code § 2-306 (McKinney's 1964), and commentary thereto; 1 Williston on Contracts § 104A. Those contracts, however, often create uncertainty as to meaning and effect. See 6 Simpson & Duesenberg, Contracts § 310. Thus, it would be anomalous to hold in the face of Illinois Brick that a requirements contract is per se a cost-plus contract, when in reality those contracts are designed to avoid the exactness imposed by the Supreme Court for determining the existence of a cost-plus contract. Moreover, the fact that Lefrak's actual requirements for the years 1968-1974 were within a general range of 12 to 14 million gallons does not demonstrate the existence of a cost-plus contract. The relative stability of Lefrak's needs can be attributed to factors other than contractual demands. See, e. g. n. 10 supra. The mere fact that a consumer's needs are within a general range is insufficient to show that those quantities flowed from a cost-plus contract situation. Indeed, the Supreme Court in Illinois Brick recognized that variations in market patterns may arise in the context of its decision, but rejected any attempt to fashion exceptions to fit those market structures. It noted:
An exception to the contractors here on the ground that they purport to charge a fixed percentage above their costs would substantially erode the Hanover Shoe rule without justification. Firms in many sectors of the economy rely to an extent on cost-based rules of thumb in setting prices . . . These rules are not adhered to rigidly, however; the extent of the markup (or the allocation of costs) is varied to reflect demand conditions . . . The intricacies of tracing the effect of an overcharge on the purchaser's prices, costs, sales and profits thus are not spared the litigants. 431 U.S. at 744, 97 S.Ct. at 2074.
Thus, the facts before the court, as set forth in the body of this decision, belie any assertion that the requirements contracts used by Lefrak as a reasonable means to guarantee supply were pre-existing cost-plus contracts under Illinois Brick. See also City of Mishawaka, Indiana v. American Electric Power Co., Inc., 465 F.Supp. 1320 (N.D.Ind.1979).
Lefrak's further argument that it is a direct purchaser as to title is without merit because all indirect consumers eventually gain title to the product. Lefrak's interpretation of the law is unwarranted. See also Illinois Brick Co. v. Illinois, supra (indirect purchases not entitled to sue although having "title" to brick as a necessary adjunct to title to building).
[22] The court is not unmindful of the fact that in Lefrak v. ARAMCO, et al., 405 F.Supp. 597 (E.D.N.Y. 1975), it found that plaintiffs established a direct causative link between their injuries and the alleged conspiracy. The allegations made in 1975, however, are in stark contrast to the case now before the court. The domestic conspiracy has blossomed into an international conspiracy, Thus, the court must now consider important geographical factors in assessing the target area concept. Long Island Lighting Co. v. Standard Oil of California, 521 F.2d 1269 (2d Cir. 1975).
[23] Crude oil and its refined by-products are "different" substances. Carey v. National Oil Corp., 592 F.2d 673, 676 (2d Cir. 1979). See also Bill Minielli Cement Contracting, Inc. v. Richter Concrete Corp., 62 F.R.D. 381, 389 (S.D.Ohio 1973).
[24] Lefrak contends that its demand for injunctive relief under federal law is a basis for retaining jurisdiction over the pendent state law claims and for denying Aramco's motion for summary judgment under Illinois Brick. Even assuming that Lefrak's argument that Illinois Brick bars only damage actions and not claims for injunctive relief is correct, see In re Beef Industry Antitrust Litigation, 600 F.2d 1148 (5th Cir. 1979); Mid-West Paper Prods. Co. v. Continental Group, Inc., 596 F.2d 573 (3rd Cir. 1979), the court nonetheless finds that it must dismiss Lefrak's claims. First, any basis for granting injunctive relief at this time for violations that allegedly ceased in 1974 is remote. See, e. g., Long Island Lighting Co. v. Standard Oil Co. of Calif., 521 F.2d 1269 (2d Cir. 1970), cert. denied, 401 U.S. 923 (1971). Second, there is a patent lack of an immediate, threatened injury to plaintiffs which would support a claim for injunctive relief. 15 U.S.C. § 26. Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 89 S.Ct. 1562, 23 L.Ed.2d 129 (1969); United States v. Borden Co., 347 U.S. 514, 74 S.Ct. 703, 98 L.Ed. 903 (1954). Thus, this case presents a different factual situation than that in either In re Beef Industry, supra or Mid-West Paper Products, supra. Thus, there is no basis for retaining jurisdiction over the state claims or for denying Aramco's motion. See also Illinois Brick Co. v. Illinois, supra (claims for both damages and injunctive relief dismissed).
Lefrak further asserts that this court has jurisdiction over some of the defendants pursuant to 28 U.S.C. § 1332. It is established that coconspirators are not indispensable such that their absence would result in dismissal for nonjoinder. Fed.R.C.P. 19; Herpich v. Wallace, 430 F.2d 792 (5th Cir. 1970). The following circumstances, however, indicate that dismissal is appropriate: all federal questions have been dismissed; unsettled questions of state law are present; the state judicial system is reviewing questions similar to those posed by Lefrak's Donnelly Act claim and is suited for state court determination. Finally, plaintiff's attempt to exclude some defendants, at this late date, after years of discovery among all parties and after the issues have been framed by and as among all parties so that the court can retain federal jurisdiction over the intentional tort and Donnelly Act claims, must fail. Accordingly, dismissal would, in any event, be appropriate.
[25] The dismissal will not bar a subsequent suit by Lefrak in the state courts. It appears that §§ 203(d), 205(a), (b) of the Civil Practice Law and Rules of New York (McKinney's 1972) apply to Lefrak's assertion of its state law claims here, and serve to toll the applicable statute of limitations. See Federman v. Empire Fire and Marine Ins. Co., supra at 809, n. 18.
[26] See S.Rep. No. 96-239, 96th Cong., 1st Sess. (1979).
[27] Id. at 1.
[28] Id. at 2.
[29] Id. at 3.
[*] Editor's note: all but one contract has been deleted for publication.
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Sambel Properties, LLC v. Baker, No. 720-11-15 Wncv (Tomasi, J., Jan. 19, 2016)
[The text of this Vermont trial court opinion is unofficial. It has been reformatted from the original. The accuracy
of the text and the accompanying data included in the Vermont trial court opinion database is not guaranteed.]
STATE OF VERMONT
SUPERIOR COURT CIVIL DIVISION
Washington Unit Docket No. 720-11-15 Wncv
Sambel Properties, LLC,
Plaintiff
v.
Elizabeth Baker,
Defendant
Opinion and Order on Defendant’s Motion to Dismiss
Defendant has moved to dismiss this action alleging that the notice of
termination sent by Plaintiff’s attorney did not comport with the Fair Debt
Collection Practices Act, 15 U.S.C. § 1692, et seq. (FDCPA). The Court considered
the submissions and arguments of the parties and made a ruling on the record
denying the motion. The Court concluded that, even assuming that the FDCPA
applies to notices of termination sent by a landlord’s counsel to a tenant,1 the failure
to follow the FDCPA provisions cannot provide a basis for dismissal of a landlord-
tenant action brought under Title 9 and 12 of the Vermont Statutes Annotated. The
Court’s oral determination was based on the following considerations.
First, the FDCPA has a specific remedy provision that permits only monetary
damages. 15 U.S.C. § 1692k. The Court believes the exclusive remedy available to
Defendant for her claim is an affirmative action asserting a violation of the FDCPA
against the purported debt collector. Accord Barstow Rd. Owners, Inc. v. Billing,
687 N.Y.S.2d 845, 852 (Dist. Ct. 1998).
Second, though there are decisions going the other way, the Court believes
the better reasoned opinions from other states have specifically held that a violation
of the FDCPA cannot be used as a defense in an eviction action. Dearie v. Hunter,
705 N.Y.S.2d 519, 520 (App. Term 2000); Missionary Sisters of Sacred Heart, Inc. v.
Dowling, 703 N.Y.S.2d 362, 367-68 (Civ. Ct. 1999); Karron v. Karron, 981 N.Y.S.2d
636, 2013 WL 56769672013, at *2 (Dist. Ct. 2013); see also Kara B. Schissler, Note,
Come and Knock on Our Door: The Fair Debt Collection Practices Act’s Intrusion
into New York’s Summary Proceedings Law, 22 Cardozo L. Rev. 315, 347-50 (2000)
(arguing that FDCPA cannot rightly be used as a defense in an eviction case).
Third, the principal decision relied upon by Defendant in support of her
position was Romea v. Heiberger & Associates, 163 F.3d 111 (2d Cir. 1998), which
1
There are few appellate cases on point and, while most conclude that the FDCPA is
applicable in this context, at least one has found to the contrary. Wilson Han
Association, Inc. v. Arthur, N.Y.L.J., 7/6/99, p. 29, col. 4 (App. Term, 2d and 11th
Jud. Dists. 1999).
involved a direct action against a law firm under the FDCPA. The lower court in
that proceeding noted that it was “unlikely” that its determination that landlords’
attorneys are subject to the FDCPA could be used as a defense in a landlord-tenant
proceeding. See Romea v. Heiberger & Associates, 988 F. Supp. 715, 718 n.12
(S.D.N.Y. 1998); see also Arrey v. Beaux Arts II, LLC, 101 F. Supp. 2d 225, 226
(S.D.N.Y. 2000) (noting “dubious merit of any contention that a violation of the
[FDCPA] would constitute a defense in [an eviction] matter”).
Fourth, the result is consistent with decisions finding that a violation of
federal anti-trust laws does not act as a defense to actions to recover goods, id., and
with decisions finding that violations of the FDCPA do not amount to legal defenses
in state foreclosure actions, see Washington Mut. Bank v. Delbuono, No.
CV030081479S, 2003 WL 21958417, at *4 (Conn. Super. Ct. July 29, 2003).
Based on those considerations, the Motion to Dismiss is denied.2
Electronically signed on January 19, 2016 at 11:11 AM pursuant to V.R.E.F.
7(d).
________________________
Timothy B. Tomasi
Superior Court Judge
2
Even if the FDCPA could be asserted as a defense in this case, it would only have
relevance to Plaintiff’s claim for the “debt” of back rent. It would not bar an action
for possession. Accordingly, a motion seeking dismissal of the entire case would be
inappropriate. Accord Barstow Rd. Owners, Inc., 687 N.Y.S.2d at 852.
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206 F.2d 70
In re CENTRAL STATES ELECTRIC CORP. (two cases).Petition of HENIS et al.Petition of O'BRIEN.
No. 6616.
No. 6621.
United States Court of Appeals Fourth Circuit.
Argued June 3, 1953.
Decided July 16, 1953.
No. 6616:
Ralph Montgomery Arkush, New York City, for petitioners.
Thomas C. Egan, Philadelphia, Pa. David J. Mays, Richmond, Va., and Thomas F. Boyle, New York City (Harry R. Axelroth, Philadelphia, Pa., Francis E. Walter, Easton, Pa., Tucker, Mays, Cabell & Moore, Richmond, Va., Boyle, Feller, Stone & McGivern, and James P. Reeves, New York City, on the brief), for respondents.
No. 6621:
Cornelius C. O'Brien, Philadelphia, Pa. (Francis J. Myers, Philadelphia, Pa., and Allen, Allen, Allen & Allen, Richmond, Va., on the brief), for petitioner.
No appearance for respondents.
Before PARKER, Chief Judge, and SOPER and DOBIE, Circuit Judges.
PER CURIAM.
1
These are petitions for leave to appeal from an order of the court below making allowances to counsel and committees in the bankruptcy reorganization proceedings of the Central States Electric Corporation. In No. 6616 the leave to appeal is asked by certain holders of participation certificates issued under the plan to the 7% preferred stockholders. They seek to challenge on appeal the very substantial allowance made to the attorneys for the committee of the 7% preferred stockholders and the comparatively small allowances made to counsel of the 6% preferred stockholders committee and to the members, secretary and counsel of the Kelly and Doyle committees representing common stockholders. In No. 6621 leave to appeal is asked by Joseph L. O'Brien, one of the members of the 7% stockholders committee from that portion of the order of the lower court which denies his petition for compensation.
2
No. 6616.
3
Under the plan of reorganization the 7% preferred stockholders were paid approximately $198 per share and were issued participation certificates or "stubs" giving the holders the right to participate in certain residual assets. Petitioners hold only 2,011 of these "stubs", as against 68,880 outstanding, and all except 180 of these were acquired long after the plan of reorganization had become effective. As these petitioners are the holders of a comparatively insignificant interest in tag end assets and as the greater part of even this interest was acquired after the order of which they complain and represents nothing more than buying into a lawsuit, they have little equitable standing to challenge that order. Particularly is this true where the challenge relates principally to the allowance made counsel for the 7% preferred stockholders, in whose shoes the stub holders must stand, who profited greatly from the services of counsel and who voiced no opposition to the allowance when it was made. See In re Commonwealth & Southern Corporation, 3 Cir., 186 F.2d 708, 712; Cf. Ortion v. Austrian, 4 Cir., 166 F.2d 939. We need not go into this, however, since we think petitioners have no legal standing to appeal. They did not appear in the court below and ask relief nor were they personally made parties in any other way. All of the 7% preferred stockholders were represented by a committee and by the trustees. If not satisfied with this representation, petitioners should have intervened in the proceedings below and objected to the order which was entered. Not having done so, they may not appeal from an order in a proceeding to which they did not make themselves parties. To permit such appeals would result in endless confusion. In re Van Sweringen Corporation, 6 Cir., 180 F.2d 119. See also Payne v. Niles, 20 How. 219, 61 U.S. 219, 15 L.Ed. 895; United States v. Seigel, 83 U.S.App.D.C. 88, 168 F.2d 143.
4
No. 6621.
5
Joseph L. O'Brien asked an allowance of compensation for services which he had rendered in the organization and work of the 7% preferred stockholders committee. Sec. 249 of the Bankruptcy Act, 11 U.S.C.A. § 649 provides that no compensation or reimbursement shall be made to "any committee or attorney, or other person acting in the proceedings in a representative or fiduciary capacity" who at any time after assuming to act in such capacity has purchased or sold claims against or stock of the corporation being reorganized. It appears that O'Brien was a member of a firm which had owned 10,544 shares of the 7% preferred stock and which prior to his organization of the committee had sold all of this stock to members of the firm, 1,000 shares being sold to O'Brien's wife. 200 of these 1,000 shares were given to O'Brien's sister and employees of the firm, and later, after the organization of the committee, the remaining 800 shares were sold by the wife at a profit of $118,000. It appears, also, that the firm of which O'Brien was a member traded in stock of American Cities and Blue Ridge Corporation, subsidiaries of Central States, during the reorganization proceeding. We agree with the court below that the making of an allowance to O'Brien was precluded by the sale of stock by his wife. In re Midland United Co., D.C., 64 F.Supp. 399, 416, affirmed 3 Cir., 159 F.2d 340, 347; In re Inland Gas Corp., D.C., 73 F.Supp. 785, 791-792. And we do not think that his position is helped by the contention that the sale was to a purchaser who was acquiring that stock along with other shares in connection with a plan to have the reorganization proceedings dismissed, or that the sale, not disclosed till long after the event, was motivated by O'Brien's conception of what was best in reorganization strategy.
6
Although the District Judge did not base the denial of compensation to O'Brien on the trading by his firm in the stock of the subsidiaries, we agree with the statement in the memorandum filed in the court below in behalf of the Securities and Exchange Commission that this was ground for denial. See In re Midland United Co., supra. Trading by the firm was, of course, sufficient basis for denying compensation to a member. In re Mountain States Power Co., 3 Cir., 118 F.2d 405; In re Reynolds Investing Co., 3 Cir., 130 F.2d 60. And, while the relationship between a corporation and its subsidiaries may in some cases not always be so close as to bring trading in their securities within the inhibition of the statute, we think there can be no question as to its doing so here, where the subsidiaries were so clearly part and parcel of a single enterprise that in approving the plan of reorganization we said of it: Central States Elec. Corp. v. Austrian, 4 Cir., 183 F.2d 879, 884, "What is really accomplished by the plan is not the liquidation of Central, but the replacement of the existing three-tier structure (with the leverage therein inherent) by a new company with a single class of securities, common stock." As was well said in the memorandum filed in behalf of the Securities and Exchange Commission:
7
"The operations of the subsidiaries, while not intermingled, were supervised by a common board of directors and common officers and a joint staff. The trustees of the Debtor were two of the five directors at all times. The Debtor and its subsidiaries maintained separate corporate existence and had separate accounts and books. However, the system was considered by all the parties as a single family of companies and it was recognized that the Debtor had a preponderant and controlling interest in the two subsidiaries. By reason of leverage, any slight change in the market value of the subsidiaries' holdings was reflected markedly in the asset value of the debtor and the market prices of its outstanding securities. Numerous matters regarding the subsidiaries were brought before the Court and, in fact, the claims for compensation in substantial measure are based upon services in connection with these matters. The 7% Preferred Committee, among others, felt American Cities and Blue Ridge to be so important that they urged representation for themselves on the boards of these companies. They also sought and obtained continuous information regarding portfolio changes in the two subsidiaries."
8
Both petitions for leave to appeal will be denied.
9
Leave to Appeal Denied.
| {
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Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
01/18/2019 01:08 AM CST
- 873 -
Nebraska Supreme Court A dvance Sheets
301 Nebraska R eports
STATE v. SAVAGE
Cite as 301 Neb. 873
State of Nebraska, appellee, v.
Courtney J. Savage, appellant.
___ N.W.2d ___
Filed December 14, 2018. No. S-17-1166.
1. Criminal Law: Convictions: Evidence: Appeal and Error. When
reviewing a criminal conviction for sufficiency of the evidence, it does
not matter whether the evidence is direct, circumstantial, or a combi-
nation thereof, the standard is the same: An appellate court does not
resolve conflicts in the evidence, pass on the credibility of witnesses,
or reweigh the evidence; such matters are for the finders of fact. The
relevant question is whether, after viewing the evidence in the light most
favorable to the prosecution, any rational trier of fact could have found
the essential elements of the crime beyond a reasonable doubt.
2. Verdicts: Appeal and Error. Only where evidence lacks sufficient pro-
bative force as a matter of law may an appellate court set aside a guilty
verdict as unsupported by evidence beyond a reasonable doubt.
3. Rules of Evidence. In proceedings where the Nebraska Evidence Rules
apply, the admissibility of evidence is controlled by the Nebraska
Evidence Rules; judicial discretion is involved only when the rules make
discretion a factor in determining admissibility.
4. Rules of Evidence: Appeal and Error. Where the Nebraska Evidence
Rules commit the evidentiary question at issue to the discretion of the
trial court, an appellate court reviews the admissibility of evidence for
an abuse of discretion.
5. Sentences: Appeal and Error. An appellate court will not disturb a sen-
tence imposed within the statutory limits absent an abuse of discretion
by the trial court.
6. Pleadings: Evidence: Appeal and Error. A motion in limine is a pro-
cedural step to prevent prejudicial evidence from reaching the jury, but
is not an appealable order. The purpose of a motion in limine is to pro-
duce, when appropriate, an advance ruling on anticipated objectionable
material, and the denial of the motion cannot, in and of itself, constitute
reversible error.
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STATE v. SAVAGE
Cite as 301 Neb. 873
7. Rules of Evidence: Proof. A proponent of evidence is not required to
conclusively prove the genuineness of the evidence or to rule out all
possibilities inconsistent with authenticity.
8. Rules of Evidence. Generally, the foundation for the admissibility of
text messages has two components: (1) whether the text messages were
accurately transcribed and (2) who actually sent the text messages.
9. Rules of Evidence: Proof. The proponent of text messages is not
required to conclusively prove who authored the messages. The possibil-
ity of an alteration or misuse by another generally goes to weight, not
admissibility.
10. Rules of Evidence: Hearsay: Proof. The State must prove by a greater
weight of the evidence that a defendant authored or made a statement
in order to establish preliminary admissibility as nonhearsay under Neb.
Rev. Stat. § 27-801(4)(b)(i) (Reissue 2016).
11. Rules of Evidence: Proof. Under what is commonly and incorrectly
referred to as the “best evidence rule,” in order to prove the content of
a writing, recording, or photograph, the original writing, recording, or
photograph is required.
12. ____: ____. The “original writings rule” applies only if the party offer-
ing the evidence is seeking to prove the contents of a writing, recording,
or photograph.
13. Rules of Evidence. The rule of completeness allows a party to admit the
entirety of an act, declaration, conversation, or writing when the other
party admits a part and when the entirety is necessary to make it fully
understood.
14. ____. The rule of completeness is concerned with the danger of admit-
ting a statement out of context, but when this danger is not present, it
is not an abuse of discretion to refuse to require the production of the
remainder or, if it cannot be produced, to exclude all the evidence.
15. Motions to Dismiss: Directed Verdict: Waiver: Appeal and Error. A
defendant who moves for dismissal or a directed verdict at the close of
the evidence in the State’s case in chief in a criminal prosecution and
who, when the court overrules the dismissal or directed verdict motion,
proceeds with trial and introduces evidence, waives the appellate right
to challenge correctness in the trial court’s overruling the motion for
dismissal or a directed verdict.
16. Directed Verdict: Appeal and Error. When a defendant makes a
motion at the close of the State’s case in chief and again at the conclu-
sion of all the evidence, it is proper to assign as error that the defend
ant’s motion to dismiss made at the conclusion of all the evidence
should have been sustained.
17. Convictions: Evidence: Appeal and Error. A conviction will be
affirmed in the absence of prejudicial error if the properly admitted
- 875 -
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301 Nebraska R eports
STATE v. SAVAGE
Cite as 301 Neb. 873
evidence, viewed and construed most favorably to the State, is sufficient
to support the conviction.
18. Convictions: Corroboration: Witnesses: Testimony. When the law
requires corroboration of a witness to support a conviction, a wit-
ness’ testimony must be accompanied by evidence other than that from
the witness.
19. Convictions: Corroboration: Witnesses: Testimony: Controlled
Substances. Under the Uniform Controlled Substances Act, corrobora-
tion is sufficient to satisfy the requirement that a conviction not be based
solely upon uncorroborated testimony of an individual cooperating with
the prosecution if the witness’ testimony is corroborated as to material
facts and circumstances which tend to support the testimony as to the
principal fact in issue.
20. Criminal Law: Corroboration: Testimony. Testimony of a cooperating
individual need not be corroborated on every element of a crime.
21. Convictions: Controlled Substances: Evidence: Proof. Evidence that
a defendant had constructive possession of a drug with knowledge of
its presence and its character as a controlled substance is sufficient to
support a finding of possession and to sustain a conviction for unlaw-
ful possession.
22. Controlled Substances: Evidence: Proof. Constructive possession may
be proved by direct or circumstantial evidence and may be shown by
the accused’s proximity to the substance at the time of the arrest or by a
showing of dominion over the substance.
23. Sentences. When imposing a sentence, a sentencing judge should con-
sider the defendant’s (1) age, (2) mentality, (3) education and experi-
ence, (4) social and cultural background, (5) past criminal record or
record of law-abiding conduct, and (6) motivation for the offense, as
well as (7) the nature of the offense, and (8) the violence involved in the
commission of the crime.
Appeal from the District Court for Lancaster County: Susan
I. Strong, Judge. Affirmed.
Darik J. Von Loh, of Hernandez Frantz, Von Loh, for
appellant.
Douglas J. Peterson, Attorney General, and Austin N. Relph
for appellee.
Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke,
Papik, and Freudenberg, JJ.
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STATE v. SAVAGE
Cite as 301 Neb. 873
Freudenberg, J.
I. NATURE OF CASE
Courtney J. Savage was arrested and charged with pos-
session of a controlled substance with intent to deliver, in
violation of Neb. Rev. Stat. § 28-416(2)(a) (Reissue 2016), a
Class II felony. He was further alleged to be a habitual crimi-
nal pursuant to Neb. Rev. Stat. § 29-2221 (Reissue 2016).
During trial, the State produced evidence of text messages
from what was purported to be Savage’s cell phone, which
indicated that Savage was selling the illegal drug metham-
phetamine. Savage objected to the offer of the text messages
on foundation and hearsay grounds, primarily arguing that the
identity of the message author was unclear. The district court
overruled his objections, and after trial, a jury found Savage
guilty. The district court determined that Savage was a habit-
ual criminal and ordered him to serve 10 to 18 years in prison.
Savage appeals from his conviction.
II. BACKGROUND
Savage was arrested and charged with possession of a
controlled substance with intent to deliver, in violation of
§ 28-416. Further, he was alleged to be a habitual criminal
pursuant to § 29-2221. Following trial, he was convicted and
found to be a habitual criminal. Savage was subsequently sen-
tenced to a term of 10 to 18 years’ incarceration. The facts of
his arrest and trial leading to his conviction follow.
1. February 16 and 17, 2017, A rrest
During the night of February 16, 2017, and the early morn-
ing hours of February 17, Lincoln Police Department officers
Anthony Gratz and Andrew Barksdale arrested Michael Dryden
for possession of methamphetamine with intent to deliver.
After being brought to the police station to be interviewed,
Dryden received several text messages from an individual
referred to as “Pint” seeking to sell Dryden methamphetamine.
Later, through a review of the Lincoln Police Department’s
records management system, it was learned that “Pint” was a
nickname for Savage.
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STATE v. SAVAGE
Cite as 301 Neb. 873
With Dryden’s permission, the officers borrowed Dryden’s
cell phone and continued to communicate with Savage, hop-
ing to find him and arrest him for his potential illegal meth-
amphetamine sale to Dryden. After multiple text messages
were exchanged, a meeting to purchase methamphetamine
was arranged to occur at an agreed-upon location in Lincoln,
Nebraska. When the officers arrived at that location, they
parked in a nearby alleyway, began surveillance, and continued
the text conversation.
The officers received a message from Savage’s cell phone
indicating that he was at the agreed-upon location. Seeing no
one arrive, the officers drove around the block. The officers
then saw a blue two-door Toyota. The police cruiser and the
Toyota were the only vehicles in the area. Almost immediately
after the police saw the Toyota drive by, Dryden’s cell phone
received a text message stating: “Police [are] outside.”
The officers concluded that Savage was in the passing
Toyota. The officers followed the Toyota and observed it fail
to properly signal a turn. The officers initiated a traffic stop of
the Toyota.
During the stop, one of the officers approached the driver’s
side of the Toyota while the other officer approached the pas-
senger’s side. Gratz made contact with the driver, Johnathon
Addleman, and asked for his license and registration. When
Addleman failed to produce the requested documentation,
Gratz asked him to exit the Toyota. Savage was sitting in the
passenger seat of the Toyota and appeared to be using his
cell phone. Another passenger, Christine Tannehill, was in the
back seat.
While Gratz was questioning Addleman, Barksdale attempted
to make contact with Savage in the passenger seat. However,
Savage would not acknowledge Barksdale and maintained eye
contact with his cell phone. After some time, Savage opened
the door to speak with Barksdale. At that point, Barksdale
observed that Savage’s zipper was undone and a part of his
pants was pulled through the zipper opening.
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STATE v. SAVAGE
Cite as 301 Neb. 873
Addleman later explained to Gratz that as the officers were
pulling the Toyota over, Savage was “wrestling around in the
groin area of . . . his pants” and threw a bag at Tannehill,
instructing her to “put it in [her] pussy.” Tannehill was ques-
tioned by the officers, at which time she admitted to having
methamphetamine on her person and turned it over to the offi-
cers. At trial, several of the State’s witnesses, including Gratz
and Barksdale, testified that it was common for individuals
possessing drugs to hide them in or near their genitalia.
Within the surrendered bag, there were three smaller indi-
vidual bags, each of which pretested positive for amphetamine.
Later, a laboratory test confirmed that the substance was meth-
amphetamine. The three bags, collectively, contained in excess
of 7.6 grams of the substance. In addition to the bags of meth-
amphetamine, an officer collected each person’s cell phone.
Later, the cell phones were analyzed and data was extracted for
investigative purposes.
2. Motion in Limine
Prior to trial, Savage filed a motion in limine to exclude
evidence of various text messages contained on Savage’s and
Dryden’s cell phones. Savage argued that the State would be
unable to authenticate the text messages because, although the
messages were being sent from Savage’s cell phone, there was
no way to prove that Savage was the one texting Dryden at
the relevant time. Savage further argued that the text messages
would be hearsay and overly prejudicial. The State responded
that it could produce the foundation for admission of the text
messages into evidence by (1) proving that the cell phone in
question was Savage’s, (2) proving that the cell phone was in
Savage’s possession at the time of his arrest, and (3) present-
ing witness testimony that Savage was sending the messages at
issue. The district court overruled Savage’s motion in limine.
3. Trial
At trial, the State had several witnesses testify as to the
events of February 16 and 17, 2017, including Gratz, Barksdale,
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STATE v. SAVAGE
Cite as 301 Neb. 873
Dryden, Addleman, and Tannehill. Gratz and Barksdale specifi-
cally testified that a typical “personal use amount” of metham-
phetamine was about 0.2 grams, thereby indicating that the
amount in this case was a “dealer quantity.”
(a) Exhibit 6
During Gratz’ testimony, the State offered exhibit 6, pho-
tographs of the text conversation between the officers and
Savage’s cell phone, into evidence. Savage objected to this on
foundation and hearsay grounds, asserting that the State did
not prove that Savage authored those text messages. The State
claimed that it had met its burden regarding foundation and
authentication, insofar as Gratz testified that he saw Savage
using Savage’s cell phone at the time of the arrest. The district
court overruled Savage’s objection.
(b) Exhibits 8 and 23
The State also offered into evidence exhibits 8 and 23, por-
tions of extractions from Savage’s and Dryden’s cell phones
containing text messages and cell phone logs from the relevant
time period. A police officer testified that he extracted and ana-
lyzed the data from Savage’s cell phone using a program called
Cellbrite. The officer stated that he found that Savage’s cell
phone’s wireless network tethering service, or access point, had
“Savage 11” as the password associated with it. Another police
officer testified that he extracted and analyzed the data from
Dryden’s cell phone also using the Cellbrite program.
Savage objected to both exhibits 8 and 23 on hearsay,
foundation, best evidence, and completeness grounds. Savage
elaborated that exhibit 23 was inadmissible because (1) the
State did not prove that Savage authored the relevant messages
and (2) it was only a portion of the Cellbrite report. The district
court overruled the objections.
(c) Dryden
Both Dryden and Addleman testified in the State’s case in
chief pursuant to cooperation agreements. Dryden testified
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STATE v. SAVAGE
Cite as 301 Neb. 873
that as a dealer of methamphetamine, he purchased that drug
from Savage, whom he knew only by the name “Pint,” on a
few occasions. However, Dryden stated that he communicated
with Savage only through a family member of Savage’s and
never spoke to Savage on the cell phone directly. In fact,
Savage was not listed as a contact in Dryden’s cell phone.
Dryden also testified that Tannehill was always present dur-
ing these sales and that she appeared to be “overseeing”
the operation.
(d) Addleman
Addleman testified that he met Savage and Tannehill at a
house in Lincoln and agreed to give them a ride to another
location where they were allegedly going to drop off a large
amount of methamphetamine. Addleman stated that Tannehill
was giving directions to the address while appearing to use
Savage’s cell phone.
Addleman asserted that after the arrest, Savage devised a
plan to implicate Tannehill. Addleman agreed with Savage’s
request that he sign a notarized statement implicating Tannehill.
In his testimony, he claimed that Savage had him rewrite the
statement approximately four times. Addleman asserted that
he agreed to write the statement only because he wanted to
avoid being labeled a “snitch” while at the jail. After he was
released from jail, Addleman immediately contacted the public
defender’s office and the police department to advise them of
Savage’s plan and the falsity of his notarized statement.
(e) Christina Krueger
Savage called Christina Krueger to testify on his behalf.
Krueger was employed with the Lancaster County jail as a cor-
rectional officer. She testified that in the course of her employ-
ment, she regularly watched the inmates and often interacted
with them. She stated that during Savage and Addleman’s time
in jail, she became familiar with Savage and Addleman and
had interacted with them. Krueger testified that she was aware
of Savage and Addleman’s interaction regarding Addleman’s
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STATE v. SAVAGE
Cite as 301 Neb. 873
notarized letter. She testified that, though she did not actually
see the contents of the letter, Addleman did not seem under
duress; nor did she notice any strange behaviors. Krueger
testified that Addleman stated that he was signing freely and
voluntarily before the notary. She noted the existence of certain
procedures for inmates to request “protective custody” if they
are being harassed by another inmate. On cross-examination,
Krueger testified that Savage was the one who initiated the
notarization process.
(f) Tannehill
Tannehill stated that her primary reason for testifying
was because she was subpoenaed and wanted to ensure that
Savage was held accountable for his actions on the night of
February 16, 2017. She did not testify pursuant to a coopera-
tion agreement, as she had already pled guilty to her charges.
Tannehill stated that she was a user of methamphetamine and
that she had previously purchased that drug from Savage,
whom she knew only by the name “Pint” until the night of
their arrest.
Tannehill further testified that Savage came over to her
house on the evening of February 16, 2017, and asked her
to drive him to Lincoln. She agreed, and the pair eventually
arrived at a Lincoln house where there were several people,
including Addleman. Tannehill admitted to smoking meth-
amphetamine given to her by Savage and observing Savage
weighing the drug while at the house.
Tannehill testified that Addleman later agreed to give Savage
and Tannehill a ride to a subsequent location, where the pair
were allegedly going to drop off “quite a big amount” of meth-
amphetamine. Tannehill testified that while in the car, Savage
gave her his cell phone to check the address of the location.
She testified that she did not send or receive any text messages
while on his cell phone, but simply utilized a map application
thereon. Shortly after the police began following Addleman’s
Toyota, Savage took the drugs out of his pants and instructed
Tannehill to put them in her vagina.
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STATE v. SAVAGE
Cite as 301 Neb. 873
4. Verdict
At the close of the State’s evidence, Savage moved for
the court to dismiss the case, alleging that the State had not
met its burden of proof beyond a reasonable doubt. The dis-
trict court overruled his motion. Savage renewed the motion
for a directed verdict at the close of all the evidence, which
motion the district court again denied. After deliberations, the
jury found Savage guilty and the district court accepted the
jury’s verdict.
5. Posttrial and Sentencing
The court held an enhancement hearing where Savage
was determined to be a habitual criminal under § 29-2221.
Subsequently, at the sentencing hearing, the district court sen-
tenced Savage to a term of not less than a mandatory minimum
of 10 years’ and not more than 18 years’ imprisonment.
III. ASSIGNMENTS OF ERROR
Savage assigns, rephrased and renumbered, that the dis-
trict court erred in (1) overruling Savage’s motion in limine;
(2) overruling Savage’s motion to dismiss at the close of the
State’s case; (3) allowing the case to go to a jury without suf-
ficient evidence to support a verdict; (4) allowing evidence of
text messages from Savage’s and Dryden’s cell phones over
hearsay, foundation, completeness, and best evidence objec-
tions; and (5) abusing its discretion by imposing an exces-
sive sentence.
IV. STANDARD OF REVIEW
[1,2] When reviewing a criminal conviction for sufficiency
of the evidence, it does not matter whether the evidence is
direct, circumstantial, or a combination thereof, the standard
is the same: We do not resolve conflicts in the evidence,
pass on the credibility of witnesses, or reweigh the evidence;
such matters are for the finders of fact. The relevant ques-
tion is whether, after viewing the evidence in the light most
favorable to the prosecution, any rational trier of fact could
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STATE v. SAVAGE
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have found the essential elements of the crime beyond a rea-
sonable doubt.1 Only where evidence lacks sufficient proba-
tive force as a matter of law may an appellate court set aside
a guilty verdict as unsupported by evidence beyond a reason-
able doubt.2
[3,4] In proceedings where the Nebraska Evidence Rules
apply, the admissibility of evidence is controlled by the
Nebraska Evidence Rules and judicial discretion is involved
only when the rules make discretion a factor in determining
admissibility.3 Where the Nebraska Evidence Rules commit
the evidentiary question at issue to the discretion of the trial
court, an appellate court reviews the admissibility of evidence
for an abuse of discretion.4
[5] An appellate court will not disturb a sentence imposed
within the statutory limits absent an abuse of discretion by the
trial court.5
V. ANALYSIS
1. A dmissibility of Text Messages
and Cellbrite R eports
[6] In his first assignment of error, Savage assigns that the
district court erred in overruling his motion in limine to pre-
vent the State from entering into evidence the text messages
and Cellbrite extraction reports. We have held that a motion
in limine is a procedural step to prevent prejudicial evidence
from reaching the jury, but is not an appealable order.6 The pur-
pose of a motion in limine is to produce, when appropriate, an
advance ruling on anticipated objectionable material, and the
1
State v. Dixon, 282 Neb. 274, 802 N.W.2d 866 (2011). See, also, State v.
Hill, 298 Neb. 675, 905 N.W.2d 668 (2018).
2
State v. Dixon, supra note 1.
3
State v. Hill, supra note 1.
4
Id.
5
State v. Dixon, 286 Neb. 334, 837 N.W.2d 496 (2013).
6
See State v. Tomrdle, 214 Neb. 580, 335 N.W.2d 279 (1983).
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denial of the motion cannot, in and of itself, constitute revers-
ible error.7 However, because Savage preserved his objections
during trial and assigns the respective rulings thereon as errors
in this appeal, we address the admissibility of the text mes-
sages and Cellbrite extraction reports.
The evidence at issue is found in exhibits 6, 8, and 23.
Exhibit 6 contains photographs of Dryden’s cell phone with
the text messages between Savage’s cell phone and Dryden’s
cell phone on the screen. Exhibits 8 and 23 are portions of the
forensic data extractions of Savage’s and Dryden’s cell phones
containing the same text messages, as well as other messages
and call logs occurring around the same time.
(a) Authentication
Savage first contends that the district court erred in allowing
exhibits 6, 8, and 23 into evidence, because the text messages
contained therein were not properly authenticated. A court’s
ruling on authentication is reviewed for an abuse of discretion.8
[7] Under the Nebraska Rules of Evidence, the requirement
of authentication or identification as a condition precedent
to admissibility is satisfied by evidence sufficient to support
a finding that the matter in question is what its proponent
claims.9 We have noted that this rule does not impose a high
hurdle for authentication or identification.10 A proponent of
evidence is not required to conclusively prove the genuineness
of the evidence or to rule out all possibilities inconsistent with
authenticity.11
[8] Generally, the foundation for the admissibility of text
messages has two components: (1) whether the text messages
7
See id.
8
State v. Henry, 292 Neb. 834, 875 N.W.2d 374 (2016); State v. Draganescu,
276 Neb. 448, 755 N.W.2d 57 (2008).
9
Neb. Rev. Stat. § 27-901(1) (Reissue 2016).
10
State v. Elseman, 287 Neb. 134, 841 N.W.2d 225 (2014).
11
Id.
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were accurately transcribed and (2) who actually sent the
text messages.12 Savage does not challenge the first prong of
this test, but, rather, argues that the State failed to prove that
Savage was the author of the text messages.
[9] The State met its burden for authentication regarding the
text messages in exhibits 6, 8, and 23. The State need show
only by a greater weight of the evidence that the text mes-
sages were authored by Savage—in other words, that the text
messages were more likely than not authored by Savage. The
proponent of the text messages is not required to conclusively
prove who authored the messages.13 The possibility of an alter-
ation or misuse by another generally goes to weight, not admis-
sibility.14 Thus, the district court did not abuse its discretion in
overruling Savage’s foundation and authentication objections
to the text messages found within exhibits 6, 8, and 23.
Also respecting the authentication of text messages, Savage
argues that the current test, as analyzed above, should be
replaced with a test used in a Nevada case, Rodriguez v. State.15
In Rodriguez, the Nevada Supreme Court found the follow-
ing rule to establish the authentication of text messages from
cell phones:
[W]hen there has been an objection to admissibility of
a text message, . . . the proponent of the evidence must
explain the purpose for which the text message is being
offered and provide sufficient direct or circumstantial cor-
roborating evidence of authorship in order to authenticate
the text message as a condition precedent to its admis-
sion . . . .16
Although he claims that the State in the current case would
have failed both tests, he asserts that the Rodriguez standard
12
State v. Henry, supra note 8.
13
Id.
14
Id.
15
Rodriguez v. State, 128 Nev. 155, 273 P.3d 845 (2012).
16
Id. at 162, 273 P.3d at 849.
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for the authentication of text messages “firmly attains the tenet
established in the rules of evidence.”17 We fail to see how the
adoption of the Rodriguez test would ease the analysis for the
authentication of text messages or provide additional clarity for
such purposes in practice. Neither do we see how an applica-
tion of the Rodriguez test would result in a finding that the
text messages were not properly authenticated in this case. We
find no reason to adopt a new standard for the authentication
of text messages.
(b) Hearsay
Next, Savage contends that the text message evidence in
exhibits 6, 8, and 23 is hearsay and that the State failed to
prove that the evidence fit within the statement-by-a-party-
opponent hearsay exception. Generally, hearsay evidence, as
defined by Neb. Rev. Stat. § 27-801 (Reissue 2016), is not
admissible unless it fits within an exception to the rule against
hearsay.18 But, pursuant to § 27-801(4)(b)(i), a statement is not
hearsay if it is offered against a party and is his own state-
ment.19 Therefore, whether the text messages were authored by
Savage is a threshold matter of admissibility and a preliminary
question for the district court.20 While we earlier determined
that the State met its burden of proving that the text mes-
sages were authored by Savage by a greater weight of the
evidence for the purpose of authentication, at issue is whether
the same standard applies for proving whether a statement
falls under a hearsay exception. In other words, the question
is whether the finding of authenticity under § 27-901 is suf-
ficient to render the text messages admissible as statements by
a party opponent.
17
Brief for appellant at 23.
18
See State v. Smith, 286 Neb. 856, 839 N.W.2d 333 (2013).
19
State v. Reinhart, 283 Neb. 710, 811 N.W.2d 258 (2012); State v.
Draganescu, supra note 8.
20
See Neb. Rev. Stat. § 27-104(1) (Reissue 2016). See, also, State v. Ryan,
226 Neb. 59, 409 N.W.2d 579 (1987).
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Although we never specifically addressed the standard of
proof for the admissibility of authenticated written state-
ments as statements by a party opponent, hearsay determina-
tions are often treated as preliminary questions under Fed. R.
Evid. 104(b), which requires “evidence sufficient to support
a finding.”21 Based on our authentication analysis regarding
the standard of proof involving Fed. R. Evid. 104, this would
implicate a greater weight of the evidence standard. In addi-
tion, federal courts, when determining whether statements
were properly admitted as statements by a party opponent,
have held that the government, as the proponent of the text
messages, must show by a greater weight of the evidence that
the defendant made the statement.22 Even further, we, along-
side the Court of Appeals, have held that properly authen-
ticated text messages allegedly written by a defendant are
nonhearsay as statements by a party opponent, without doing
an additional standard of proof analysis for the nonhearsay
determination.23
[10] We hold that the State must prove by a greater weight
of the evidence that a defendant authored or made a statement
in order to establish preliminary admissibility as nonhear-
say under § 27-801(4)(b)(i). In the instant case, the district
court implicitly found that Savage authored the text messages
in question. And, based on the above-mentioned evidence
regarding authentication, we find that the State’s evidence
authenticating the text messages satisfied the greater weight
of the evidence standard for a preliminary determination
on hearsay.
Applying the appropriate standard of review for clear error
regarding the factual findings underpinning a trial court’s
21
See 1 Christopher B. Mueller & Laird C. Kirkpatrick, Federal Evidence
§ 1:28 (4th ed. 2013). See, also, U.S. v. Harvey, 117 F.3d 1044 (1997).
22
U.S. v. Benford, No. CR-14-321-D, 2015 WL 631089 (W.D. Okla. Feb. 12,
2015). See, also, U.S. v. Brinson, 772 F.3d 1314 (10th Cir. 2014).
23
See, e.g., State v. Henry, supra note 8; State v. Wynne, 24 Neb. App. 377,
887 N.W.2d 515 (2016).
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hearsay ruling and de novo regarding the court’s ultimate
determination to admit evidence over a hearsay objection,24
we conclude that the district court did not err in overruling
Savage’s hearsay objections.
(c) Best Evidence and
Completeness
Last, concerning the admissibility of evidence, Savage
assigns that the district court erred in overruling his best
evidence and completeness objections to exhibits 8 and 23.
Savage argues that because exhibits 8 and 23 were only
redacted portions of the Cellbrite cell phone data extraction
reports, the exhibits did not meet the “best evidence rule as to
completeness.”25 The State responds that (1) the exhibits were
by definition “original[s]” under Neb. Rev. Stat. § 27-1001
(Reissue 2016) and (2) the reports did not present a danger of
admitting a statement out of context, as the redactions sought
to include only the relevant information necessary to avoid jury
confusion. We agree with the State.
[11,12] Under what is commonly and incorrectly referred
to as the “best evidence rule,” in order to prove the content
of a writing, recording, or photograph, the original writing,
recording, or photograph is required.26 This “‘original writings’
rule” applies only if the party offering the evidence is seeking
to prove the contents of a writing, recording, or photograph.27
Under § 27-1001(3), defining an original under the rule, “[i]f
data are stored in a computer or similar device, any printout
or other output readable by sight, shown to reflect the data
accurately, is an original.” Here, exhibits 8 and 23 are, by defi-
nition, originals. They are printouts of exact data contained on
Savage’s and Dryden’s cell phones. In sum, because exhibits 8
24
State v. Draganescu, supra note 8.
25
Brief for appellant at 33.
26
Neb. Rev. Stat. § 27-1002 (Reissue 2016); State v. Decker, 261 Neb. 382,
622 N.W.2d 903 (2001).
27
State v. Decker, supra note 26, 261 Neb. at 389, 622 N.W.2d at 911.
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and 23 are “original[s]” under the definition in § 27-1001(3),
the district court did not err in overruling Savage’s best evi-
dence objections.
[13,14] With regard to the completeness objections, Savage
argues that if exhibits 8 and 23 were to be admitted, they
should have been admissible only in their complete form, not
in a redacted version. This argument lacks merit. The rule of
completeness allows a party to admit the entirety of an act,
declaration, conversation, or writing when the other party
admits a part and when the entirety is necessary to make it
fully understood.28 Under § 27-106(2), a judge in his or her
discretion may either require the party thus introducing part
of a total communication to introduce at that time such other
parts as ought in fairness to be considered contemporaneously
with it or permit another party to do so at that time. The rule
of completeness is concerned with the danger of admitting a
statement out of context, but when this danger is not present,
it is not an abuse of discretion to refuse to require the produc-
tion of the remainder or, if it cannot be produced, to exclude
all the evidence.29
Savage did not offer into evidence the entirety of the
Cellbrite reports. Nor does Savage allege how the remain-
der of the reports was necessary to make those documents
fully understood. He merely alleges that the admission of the
redacted portions was prejudicial, without explaining how the
redactions created a danger of admitting a statement out of
context or elaborating how the entirety of the Cellbrite reports
would have alleviated this danger. Based on the record before
us, there is nothing to suggest that exhibits 8 and 23, in their
redacted form, were misleading or prejudicial. Consequently,
the district court did not abuse its discretion when it over-
ruled Savage’s rule of completeness objections and declined to
require the State to offer the entirety of the Cellbrite reports.
28
State v. Rocha, 295 Neb. 716, 890 N.W.2d 178 (2017). See Neb. Rev. Stat.
§ 27-106 (Reissue 2016).
29
State v. Manchester, 213 Neb. 670, 331 N.W.2d 776 (1983).
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2. Sufficiency of Evidence
[15] Savage next assigns as error that because the State
failed to meet its burden of proof, the district court erred in
overruling his motion to dismiss at the close of the State’s
case. A defendant who moves for dismissal or a directed ver-
dict at the close of the evidence in the State’s case in chief in
a criminal prosecution and who, when the court overrules the
dismissal or directed verdict motion, proceeds with trial and
introduces evidence, waives the appellate right to challenge
correctness in the trial court’s overruling the motion for dis-
missal or a directed verdict.30 Because Savage proceeded with
trial after his motion to dismiss at the close of the State’s case
in chief, he waived his claim that the district court erred in
overruling his initial motion to dismiss.31
[16] But when a defendant makes a motion at the close of
the State’s case in chief and again at the conclusion of all the
evidence, it is proper to assign as error that the defendant’s
motion to dismiss made at the conclusion of all the evidence
should have been sustained.32 Savage made such a motion at
the close of all the evidence. As such, we proceed on Savage’s
third assignment of error, as it is essentially a sufficiency of the
evidence argument.33
Savage argues that the evidence was insufficient to support
a guilty verdict because there was no corroborating testimony
of Savage’s guilt as required by Neb. Rev. Stat. § 28-1439.01
(Reissue 2016) and possession thus could not be proved beyond
a reasonable doubt. We find no merit in these arguments.
[17] Regardless of whether the evidence is direct, cir-
cumstantial, or a combination thereof, an appellate court, in
30
State v. Gray, 239 Neb. 1024, 479 N.W.2d 796 (1992).
31
See id.
32
State v. Severin, 250 Neb. 841, 553 N.W.2d 452 (1996).
33
See, State v. Combs, 297 Neb. 422, 900 N.W.2d 473 (2017); State v.
Severin, supra note 32; State v. Malone, 26 Neb. App. 121, 917 N.W.2d
164 (2018).
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reviewing a criminal conviction, does not resolve conflicts in
the evidence, pass on the credibility of witnesses, or reweigh
the evidence; such matters are for the finder of fact.34 A convic-
tion will be affirmed in the absence of prejudicial error if the
properly admitted evidence, viewed and construed most favor-
ably to the State, is sufficient to support the conviction.35
[18-20] Nebraska law provides, “No conviction for
an offense punishable under any provision of the Uniform
Controlled Substances Act shall be based solely upon the
uncorroborated testimony of a cooperating individual.”36 When
the law requires corroboration of a witness to support a con-
viction, a witness’ testimony must be accompanied by evi-
dence other than that from the witness.37 Under the Uniform
Controlled Substances Act, corroboration is sufficient to sat-
isfy the requirement that a conviction not be based solely upon
uncorroborated testimony of an individual cooperating with
the prosecution if the witness’ testimony is corroborated as
to material facts and circumstances which tend to support the
testimony as to the principal fact in issue.38 Testimony of a
cooperating individual need not be corroborated on every ele-
ment of a crime.39
Savage claims that there was insufficient evidence to allow
the case to go to a jury because there were no corroborating
details regarding Savage’s alleged drug dealing as required
under § 28-1439.01 and because there was not sufficient evi-
dence to prove that Savage possessed methamphetamine. The
State provided evidence of his drug dealing in the form of both
34
State v. Pierce, 248 Neb. 536, 537 N.W.2d 323 (1995).
35
Id.
36
§ 28-1439.01.
37
State v. Goodro, 251 Neb. 311, 556 N.W.2d 630 (1996).
38
Id.
39
State v. Kramer, 238 Neb. 252, 469 N.W.2d 785 (1991); State v. Taylor,
221 Neb. 114, 375 N.W.2d 610 (1985); State v. Kuta, 12 Neb. App. 847,
686 N.W.2d 374 (2004).
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testimony and physical evidence. Though some of the testi-
mony was elicited from two cooperating individuals, Dryden
and Addleman, it cannot be said that Savage’s conviction was
based solely upon uncorroborated testimony of a cooperating
individual. The State provided evidence of text messages that
indicated that Savage was selling methamphetamine, as well as
witness testimony from five other noncooperating individuals
who generally corroborated the cooperating individuals’ testi-
mony. Savage’s § 28-1439.01 argument has no merit.
[21,22] We likewise find no merit to Savage’s argument that
the evidence was insufficient to find that Savage possessed
methamphetamine. During trial, the State relied on a theory
of constructive possession to convict Savage. Evidence that a
defendant had constructive possession of a drug with knowl-
edge of its presence and its character as a controlled substance
is sufficient to support a finding of possession and to sustain
a conviction for unlawful possession.40 Constructive posses-
sion may be proved by direct or circumstantial evidence and
may be shown by the accused’s proximity to the substance
at the time of the arrest or by a showing of dominion over
the substance.41
Both Addleman and Tannehill testified that Savage removed
a bag of methamphetamine from his groin area and threw it
to Tannehill to put into her vagina upon being pulled over by
the police officers. The arresting police officers testified that
Savage’s zipper was unusually unzipped at the time of the
traffic stop, which corroborates Addleman’s and Tannehill’s
testimony. In further support of Addleman’s and Tannehill’s
testimony, the evidence of the text messages between Savage’s
and Dryden’s cell phones demonstrates that Savage knew that
he had drugs on or at least near his person because he was
attempting to sell them. This evidence was sufficient to prove
the element of possession of methamphetamine.
40
State v. Garcia, 216 Neb. 769, 345 N.W.2d 826 (1984).
41
Id.
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Viewing the evidence in the light most favorable to the
State, we conclude that there was sufficient evidence to support
Savage’s conviction.
3. Excessive Sentence
Finally, Savage assigns that the district court abused its dis-
cretion by imposing an excessive sentence. We disagree.
When a trial court’s sentence is within the statutory guide-
lines, the sentence will only be disturbed by an appellate court
when an abuse of discretion is shown.42 Here, Savage’s sen-
tence was enhanced per Nebraska’s habitual criminal statute,
§ 29-2221. Under Nebraska law, the mandatory minimum
Savage could have been sentenced to was a term of 10 years’
imprisonment and the maximum term was not more than 60
years’ imprisonment.43 Savage was sentenced to imprisonment
for the mandatory minimum of 10 years, but no more than
18 years.
[23] Abuse of discretion occurs when a trial court’s deci-
sion is based upon reasons that are untenable or unreasonable
or if its action is clearly against justice or conscience, reason,
and evidence.44 When imposing a sentence, a sentencing judge
should consider the defendant’s (1) age, (2) mentality, (3)
education and experience, (4) social and cultural background,
(5) past criminal record or record of law-abiding conduct, and
(6) motivation for the offense, as well as (7) the nature of the
offense, and (8) the violence involved in the commission of the
crime.45 The appropriateness of a sentence is necessarily a sub-
jective judgment and includes the sentencing judge’s observa-
tion of the defendant’s demeanor and attitude and all the facts
and circumstances surrounding the defendant’s life.46
42
State v. Huff, 282 Neb. 78, 802 N.W.2d 77 (2011).
43
§ 29-2221.
44
State v. Collins, 292 Neb. 602, 873 N.W.2d 657 (2016).
45
State v. Huff, supra note 42.
46
State v. Custer, 292 Neb. 88, 871 N.W.2d 243 (2015).
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In this case, the district court considered the nature and
circumstances of the crime and the history, character, and
condition of Savage. In its sentencing order, the court noted
that Savage has “a demonstrated history of criminal activity,
disregard for the law, and an unwillingness to comport his
conduct to comply with the law.” Savage’s sentence is on the
lower end of the spectrum that could have been imposed under
§ 29-2221. Based on the record before us, the sentencing court
did not consider any inappropriate or unreasonable factors in
determining the sentence. We find that the court did not abuse
its discretion in its imposition of Savage’s sentence.
VI. CONCLUSION
For the foregoing reasons, we affirm the district court’s deci-
sion on this matter.
A ffirmed.
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981 F.2d 1244
Earl Jason LARISCEY, Plaintiff-Appellant,v.The UNITED STATES, Defendant-Appellee.
No. 90-5129.
United States Court of Appeals,Federal Circuit.
Dec. 28, 1992.Rehearing Denied March 3, 1993.
Appealed from U.S. Claims Court; Bohdan A. Futey, Judge.
John S. Moot, Washington, DC, argued, for plaintiff-appellant, on the brief on Rehearing In Banc. Also on the brief, for plaintiff-appellant were Buel White and Lewis B. Gardner.
Edward H. Rice, Dept. of Justice, argued, for defendant-appellee, on the brief on Rehearing In Banc, with him on the brief, were Stuart M. Gerson, and Vito J. DiPietro. Also on the brief, for defendant-appellee was Chun-I Chiang. Of counsel, was John Fargo.
Prior report: 20 Cl.Ct. 385; Fed.Cir., 949 F.2d 1137; 962 F.2d 1047.
Before NIES, Chief Judge, RICH, NEWMAN, ARCHER, MAYER, MICHEL, PLAGER, LOURIE, CLEVENGER, and RADER, Circuit Judges.*
ORDER
PER CURIAM.
1
The judgment in the above appeal is affirmed by an equally divided court.
*
Circuit Judge Schall took no part in the decision of this case
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RULE 105. SEARCH WARRANTS
The Pennsylvania Rules of Criminal Procedure, Rules 200 through 211 and Rule
212(B), shall apply to search warrants in juvenile delinquency matters.
COMMENT
Search warrants for juvenile cases are not available for public inspection.
The search warrant is to be treated as a juvenile record and the provisions of
Rule 160(A) apply. Once a search warrant is executed, it is filed with the Court of
Common Pleas and becomes a part of the official court record. Also, information
contained in the affidavit of probable cause attached to the search warrant is a
part of law enforcement records, which is also confidential. See 42 Pa.C.S. §§
6307 & 6308 and Rule 160.
Official Note: Rule 105 adopted April 1, 2005, effective October 1, 2005. Amended
August 11, 2016, effective October 1, 2016.
Committee Explanatory Reports:
Final Report explaining the provisions of Rule 105 published with the Court’s Order at
35 Pa.B. 2214 (April 16, 2005). Final Report explaining the amendments to Rule
1608 published with the Court’s Order at Pa.B. (__ __, 2016).
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292 B.R. 857 (2003)
In re DAYTON TITLE AGENCY, INC., Debtor-In-Possession.
Dayton Title Agency, Inc., et al., Plaintiffs,
v.
The White Family Companies, Inc., et al., Defendants.
Bankruptcy No. 99-35768. Adversary No. 99-3664.
United States Bankruptcy Court, S.D. Ohio, Western Division at Dayton.
April 25, 2003.
*858 *859 *860 *861 Sharyn J. Bennett, Robert B. Berner, Stephen K. Dankof, Donald F. Harker, III, John G. Jansing, Thomas R. Noland, Walter Reynolds, Charles D. Shook, Dayton, OH, David S. Cupps, Columbus, OH, Stewart H. Cupps, William B. Fecher, Jerome J. Metz, Jr., Cincinnati, OH, James P. Hickey, Jr., Oakwood, OH, Roger E. Luring, De Wayne Smith, Troy, MI, Ronald S. Pretekin, Dayton, OH, Frederick L. Ransier, III, Columbus, OH, for creditor.
Anne M. Frayne, Dayton, OH, for debtor.
WILLIAM A. CLARK, Bankruptcy Judge.
DECISION OF THE COURT, FOLLOWING REMAND, GRANTING PARTIAL SUMMARY JUDGMENT TO THE PARTIES AS FOLLOWS:
1) GRANTING SUMMARY JUDGMENT TO DEFENDANTS THE WHITE FAMILY COMPANIES, INC. AND NELSON WENRICK WITH RESPECT TO THE THIRD PARTY BENEFICIARY FUNDS OF $722,101.49 WHICH THE COURT CONCLUDES ARE NOT PROPERTY OF THE DEBTOR'S ESTATE;
2) DETERMINING THAT AN ISSUE OF FACT EXISTS REGARDING THE OWNERSHIP OF $20,747.13 IN FUNDS WITHIN THE TRUST ACCOUNT AT THE TIME OF THE TRANSFERS TO DEFENDANTS, THE WHITE FAMILY COMPANIES, INC. AND NELSON WENRICK, AND DENYING SUMMARY JUDGMENT TO ALL PARTIES WITH REGARD TO THESE FUNDS;
3) GRANTING SUMMARY JUDGMENT TO PLAINTIFF DAYTON TITLE AGENCY, INC. ON RECOVERY OF THE $4,142,151.38 IN PROVISIONAL LOAN PROCEEDS AS A FRAUDULENT TRANSFER UNDER OHIO'S UNIFORM FRAUDULENT TRANSFER ACT;
*862 4) GRANTING SUMMARY JUDGMENT TO DEFENDANTS, THE WHITE FAMILY COMPANIES, INC. AND NELSON WENRICK, ON THE ISSUE OF DAYTON TITLE AGENCY, INC. BUSINESS TRUST'S INELIGIBILITY FOR SEPARATE BANKRUPTCY PROTECTION;
5) DETERMINING NATIONAL CITY BANK'S MOTION FOR SUMMARY JUDGMENT TO BE MOOT; AND
6) GRANTING DAYTON TITLE AGENCY, INC.'S REQUEST FOR PREJUDGMENT INTEREST AND COURT FILING COSTS.
The court has jurisdiction over this matter pursuant to 28 U.S.C. §§ 157 and 1334, and the standing General Order of Reference entered in this district. This matter is a core proceeding pursuant to 28 U.S.C. §§ 157(b)(2)(E) and (H). The following decision is determined in accordance with Fed. R. Bankr.P. 7056.
On May 15, 2001, this court determined, on summary judgment, that the undisputed facts in this adversary proceeding supported two conclusions. First, Dayton Title Agency, Inc. Business Trust ("DTABT") was not a "business trust" for bankruptcy purposes and, thus, was ineligible for separate bankruptcy protection from the Debtor-in-Possession, Dayton Title Agency, Inc. ("Dayton Title"). In addition, the court concluded that Dayton Title was entitled to recover $4,885,000.00 transferred to Defendants the White Family Companies, Inc. ("WFC") and Nelson D. Wenrick ("Wenrick") in October of 1999 from Dayton Title's trust account with Plaintiff National City Bank. The court held that the funds were recoverable as a fraudulent conveyance under the Ohio Uniform Fraudulent Transfer Act ("UFTA"), Ohio Rev.Code §§ 1336.01 et seq. Significant to the court's conclusion was its determination that Dayton Title had a property interest in the funds, making them recoverable on behalf of the estate, even though the funds were transferred from an escrow account used to hold funds for the benefit of third parties. The court made this determination because Dayton Title exerted control over the escrow funds and used them for a purpose other than that intended by the third parties. Furthermore, the transfers diminished assets available for distribution to creditors of the estate.
The parties appealed many of this court's determinations, including its decision on summary judgment, to the United States District Court for the Southern District of Ohio. On appeal, Judge Rice affirmed many of the this court's prior determinations, but vacated and remanded this court's decision on summary judgment relating to whether DTABT was in fact a "business trust" as the term is used in bankruptcy and whether the transfer of funds to WFC and Wenrick constitutes a fraudulent conveyance under the UFTA.
FACTUAL AND PROCEDURAL BACKGROUND
A. Uncontested Facts Adopted from Prior Decision
In general, the facts from this court's decision prior to remand remain uncontested and, thus, the court adopts those findings in this decision on remand. Debtor-in-Possession, Dayton Title, whose bankruptcy case is jointly administered with the related DTABT bankruptcy, was a Dayton area title agency founded in 1973. [Adv. Doc. # 67-1, Depo. of Alex Katona ("Katona Depo."), p. 42.] Beginning in 1996, Dayton Title conducted closing agent services on real estate transactions for Krishan Chari ("Chari"), a real estate broker affiliated with Don Wright Realty. [Adv. Doc. # 70-1, Depo. of Pam Folino ("Folino Depo."), pp. 25-27.] Many of *863 these transactions involved Chari channeling funds through Dayton Title's trust accounts which were used primarily to hold third party escrow funds related to the title agency's real estate closings. [Id., pp. 17-18.]
Beginning in November of 1998, Dayton Title experienced difficulties collecting funds from Chari to cover disbursements made at his direction through the trust accounts. In at least one transaction, Dayton Title disbursed funds on behalf of Chari before Chari made a deposit into its account. [Adv. Doc. # 129-1, Ex. 3.] In connection with this same transaction and many others, Chari's checks were returned for insufficient funds. [Id., Exs. 3, 5, 11-18, 20-21, 23-24.] Some of the bounced checks resulted in substantial overdrafts in a Dayton Title trust account. [Adv. Doc. # 130-1, Ex. 70 at NCB 00277 and Adv. Doc. # 131-1, Ex. 71 at NCB 00255.]
At the center of the present dispute are transactions conducted at Chari's direction through one of Dayton Title's trust accounts with National City Bank involving Chari's real estate investment enterprise, Invesco, LLC. [Folino Depo., pp. 27-28.] Invesco was run by Chari and his partner Michael Karaman. [Id.] Beginning in December of 1998, two separate entities, WFC and Wenrick, provided short term financing, called bridge loans, to Invesco for purported real estate transactions. [Adv. Doc. # 52-1, Depo. of Timothy White ("White Depo."), pp. 28-30; Adv. Doc. # 53-1, Depo. of Nelson Wenrick ("Wenrick Depo."), pp. 14-29.] The purpose of the loans, each involving over one million dollars, was to facilitate Invesco in the purchase of commercial real estate for attractive prices. [White Depo., p. 30; Adv. Doc. # 132-1, Ex. 95.] The duration of each loan was only 30 or 45 days, long enough for Invesco to procure permanent financing. [Adv. Doc. # 90-1, Depo. of Dave Alexander ("Alexander Depo."), p. 148; White Depo., pp. 30, 34-36; Wenrick Depo., p. 29.] These loan transactions were usually closed at Dayton Title's facilities [Alexander Depo., pp. 34-35, 53, 68, 87-88, 101, 113; Wenrick Depo., p. 16] and were evidenced by notes signed by Michael Karaman on behalf of Invesco [Adv. Doc. # 132-1, Ex. 95]. Each note carried a second signature of Michael Karaman as personal guarantor. [Id.]
Between December 1, 1998 and July 12, 1999, WFC made five bridge loans to Invesco ranging from $1,900,000.00 to $3,200,000.00. [Id.] In a completely separate transaction, Wenrick furnished a $1,200,000.00 bridge loan to Invesco on August 4, 1999. [Id.] Each loan transaction was carried out by the lender depositing the funds into one of Dayton Title's accounts. [Adv. Doc. # 132-1, Exs. 99-103, 105.] These loans were paid back in full, but not always before the due dates. [Adv. Doc. # 132-1, Ex. 95; Adv. Doc. # 103-1, Exs. G, N, T, AA, GG; Wenrick Depo., pp. 235-236.]
On September 3, 1999, WFC and Wenrick each provided a final bridge loan to Invesco of $3,200,000.00 and $1,600,000.00 respectively. [Adv. Doc. # 132, Ex. 95.] The loans were made in connection with the supposed purchase of property containing a Staples retail office supply store. [Wenrick Depo., pp. 242-244; White Depo., pp. 144-145.] Like the previous loans, these were evidenced by notes containing Michael Karaman's signature as President of Invesco and a second signature of Michael Karaman as personal guarantor of the loans. [Adv. Doc. # 132-1, Ex. 95.] According to the notes, Invesco was to repay the principal and interest on the short-term loans on or before October 3, 1999. [Id.]
Soon after the loans were past due, WFC and Wenrick were repaid with *864 checks drawn on a Texas IOLTA account of John Lewis. [Adv. Doc. # 103-1, Ex. OO; Alexander Depo., pp. 118-119; Wenrick Depo. pp. 24-25.] Both checks were returned for insufficient funds. [Wenrick Depo. pp. 24-25; Alexander Depo., pp. 122-123.]
Subsequently, on October 19, 1999, Krishan Chari had a $5,000,000.00 check deposited into Dayton Title's trust account with National City Bank for the purpose of paying WFC and Wenrick. [Adv. Doc. # 99-1, App. A, Ans. to Interrog. 3(c); Adv. Doc. # 132-1, Exs. 97 and 98.] The check was purportedly drawn on a DCW Investments account at Oak Hill Bank. [Id.] The teller at National City Bank did not place a hold on the check Chari deposited. [Adv. Doc. # 132-1, Ex. 109.] On that same day, pursuant to Chari's instructions, Dayton Title issued a check payable to WFC in the amount of $3,260,000.00 and a check payable to Wenrick in the amount of $1,625,000.00 from the trust account. [Adv. Doc. # 103-1, Ex. 2, Affidavit of Pam Folino ("Folino Aff."), ¶ 4; Adv. Doc. # 132-1, Ex. 111.] The remaining $115,000.00 from Chari's $5,000,000.00 check was to remain in Dayton Title's trust account for fees payable to Dayton Title for unrelated transactions. [Folino Aff., ¶ 4.]
On October 20, 1999, Tim White presented the WFC check to a teller at National City Bank and obtained an official bank check in return. [White Depo., pp. 154-155; Adv. Doc. # 99-1, App. A., Ans. to Interrog. 3(a).] Wenrick deposited his check in an account at Security National Bank. [Wenrick Depo., pp. 39-45.] Wenrick's check cleared the trust account at National City Bank on October 25, 1999. [Adv. Doc. # 99-1, App. A., Ans. to Interrog. 3(b).]
On or about October 26, 1999, National City Bank received notification that the check deposited by Chari in Dayton Title's trust account was being returned. [Adv. Doc. # 132-1, Ex. 97.] However, WFC and Wenrick's checks were honored by National City Bank prior to the bank's discovery that Chari's check was a forgery drawn on a non-existent account. [Adv. Doc. # 99-1, App. A, Ans. to Interrog. 3(a) through 3(c), 5 and 6.] Chari deposited two subsequent $5,000,000.00 checks into Dayton Title's trust account which also bounced. [Adv. Doc. # 131-1, Ex. 79; Adv. Doc. # 132-1, Exs. 97 and 118.] Consequently, National City Bank made the decision to freeze Dayton Title's accounts on November 4, 1999. [Adv. Doc. # 132-1, Ex. 119.]
Because Chari's checks were returned, the funds in Dayton Title's trust account did not cover the checks written to WFC and Wenrick that were already honored by National City Bank. This chain of events caused Dayton Title's trust account to be substantially overdrawn. According to an account statement, Dayton Title had a negative balance of $4,142,151.38 in the trust account as of November 19, 1999 [Adv. Doc. # 131-1, Ex. 80] indicating that approximately $742,848.62 of the funds transferred to WFC and Wenrick represent money that had been in Dayton Title's trust account at the time of the conveyance. Prior to remand, no party disputed that the funds in the account were third party escrow funds held in trust by Dayton Title. [Adv. Doc. # 129-1, Ex. 2; Folino Depo., pp. 17-18.]
After learning of the forgery and the loss of over $ 4,000,000.00 in the trust account, Dayton Title Agency, Inc. and Dayton Title Agency, Inc. Business Trust filed separate Chapter 11 bankruptcy petitions on November 8, 1999. On November 10, 1999, both entities initiated adversary *865 proceedings[1] against WFC and Wenrick to recover the $4,885,000.00 paid out of Dayton Title's trust account as fraudulent transfers under provisions of the Bankruptcy Code and Ohio statutory law. National City Bank has been joined as a plaintiff-intervenor in the recovery of the funds.
B. Additional Facts From Renewed Requests for Summary Judgment
To supplement the uncontested facts from their earlier briefings, the parties expound on additional facts submitted with their renewed requests for summary judgment after remand.
In its initial supplemental brief on remand, Dayton Title argued that all of the funds in the trust account at the time of the transfers to WFC and Wenrick, totaling $742,848.62, were third party funds held in trust by Dayton Title. In its responsive brief, however, Dayton Title argues for the first time that $20,747.13 in the account at the time of the transfers was not being held in trust, but was money both legally and equitably owned by Dayton Title. [Adv. Doc. # 285-1, p. 4.] According to Dayton Title, the money represents fees earned from third parties or expenses repaid. [Id.] To support this argument, Dayton Title attaches an affidavit of Anne Frayne and a spreadsheet dated November 3, 1999 documenting the amount due to Dayton Title in checks written from the trust account that allegedly did not clear. [Adv. Doc. # 285-1, attached Aff. of Anne Frayne and Ex. C.] In response, Defendant Wenrick notes that the bank continued to honor checks up until the time that the account was frozen on November 4, 1999. [Adv. Doc. # 290-1, p. 13.] The spreadsheet does not clarify that the checks written to Dayton Title were, in fact, dishonored. [Id.] Furthermore, Defendant Wenrick argues that Dayton Title withdrew approximately $1,660,721.99 in funds before the bank's freeze could be implemented and selectively disbursed the funds according to its own interests. [Id., p. 14.] Defendant Wenrick asserts that if Dayton Title was owed $20,747.13 from the trust account, it should be deemed to have been part of the $1,660,721.99 withdrawn from the bank. [Id.]
As additional proof of the nature and amount of National City Bank's provisional loan, the bank relies on its proof of claim filed in this bankruptcy case and the attachments thereto. (See National City Bank Proof of Claim # 48 filed April 11, 2000). The claim is for a "checking account overdraft," totaling $4,142,151.38. Id. Significantly, the bank asserts no security interest in the proceeds from the loan. Id. Attached to the proof of claim is National City's Rules for Business Accounts effective February 1, 1999. Id. These rules explain provisional credit as well as when a security interest arises in relation to the credit given. Rule 13 states that "Depositor grants a security interest in the Account to Bank for any and all indebtedness owed by Depositor to Bank or to Bank's affiliates, however and whenever incurred or evidenced." Id.
With respect to the issue of whether DTABT is a business trust, Dayton Title focuses on the amount of business conducted through DTABT's trust accounts. It is undisputed that the majority of funds, representing third party funds, received by Dayton Title passed through the primary *866 trust account of DTABT. [Adv. Doc.# 129-1 through 131-1, Exs. 36-80 to Defs. Motion for Summ. Jud.] In fact, more transactions occurred in the DTABT accounts than in the corporate operating accounts for Dayton Title. [Adv. Doc. # 138, Ex. 3, Affidavit of Alex Katona ("Katona Aff."), ¶ 3.] The checks passing through the trust account include the forged check from Chari totaling $5,000,000.00. [Adv. Doc. # 99-1, App. A, Ans. to Interrog. 3(c); Adv. Doc. # 132-1, Exs. 97 and 98.]
All of the parties have renewed their requests for summary judgment and filed supplemental briefs asserting that the essential facts to the resolution of this adversary proceeding remain undisputed. After reviewing the supplemental briefs, and other relevant documents, the court is prepared to render its decision.
LEGAL ANALYSIS
A. Summary Judgment Standard
The appropriate standard to be used by the court to address the motions for summary judgment filed upon remand is contained in Fed.R.Civ.P. 56(c) and incorporated in bankruptcy adversary proceedings by reference in Fed. R. Bankr.P. 7056. Rule 56(c) states in part that a court must grant summary judgment to the moving party if:
the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.
Fed.R.Civ.P. 56(c). In order to prevail, the moving party, if bearing the burden of persuasion at trial, must establish all elements of its claim. Celotex Corp. v. Catrett, 477 U.S. 317, 331, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If the burden is on the non-moving party at trial, the movant must: 1) submit affirmative evidence that negates an essential element of the nonmoving party's claim; or 2) demonstrate to the court that the nonmoving party's evidence is insufficient to establish an essential element of the nonmoving party's claim. Id. at 331-32, 106 S.Ct. 2548. Thereafter, the opposing party "must come forward with `specific facts showing that there is a genuine issue for trial.'" Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (citations omitted); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249-51, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). All inferences drawn from the underlying facts must be viewed in a light most favorable to the party opposing the motion. Matsushita, 475 U.S. at 586-88, 106 S.Ct. 1348.
B. Analysis of Whether the Funds Transferred to WFC and Wenrick Represent Property of Dayton Title's Estate
Prior to remand, Dayton Title requested summary judgment asserting that the funds transferred to WFC and Wenrick from the Dayton Title trust account were recoverable as fraudulent transfers under the Ohio Uniform Fraudulent Transfer Act ("UFTA"), Ohio Rev.Code §§ 1336.01 et. seq. Avoidance of a transfer under state fraudulent transfer laws is permitted by the "strong arm" provisions of the Bankruptcy Code found in 11 U.S.C. § 544. Corzin v. Fordu (In re Fordu), 201 F.3d 693, 697 n. 3 (6th Cir.1999). Under § 544, a bankruptcy trustee, or a debtor-in-possession acting with the powers of a trustee, steps into the shoes "of a creditor in order to nullify transfers voidable under state fraudulent conveyance acts for the benefit of all creditors." Id.
*867 As a threshold issue to recovery under § 544 and state law, Dayton Title was required to prove that the transfer involved a property interest of the Debtor. 11 U.S.C. § 544(b). Consequently, the issue became whether the funds transferred to WFC and Wenrick from Dayton Title's trust account were property of Dayton Title.
This court initially examined the issue under a conduit theory. See McLemore v. Third National Bank in Nashville (In re Montgomery), 983 F.2d 1389, 1395 (6th Cir.1993); Nordberg v. Sanchez (In re Chase & Sanborn Corp.), 813 F.2d 1177, 1181-82 (11th Cir.1987). Under this theory, an account used as a conduit of third party money to pay selected creditors does not give a debtor an interest in the account's funds while a debtor who exercises independent control over the funds may obtain a recoverable interest.[2]Id.
On appeal, the District Court determined that this court applied the wrong legal standard in its analysis of the funds transferred to WFC and Wenrick. The District Court noted that after this court's decision granting summary judgment to Dayton Title, the Sixth Circuit issued Stevenson v. J.C. Bradford & Company (In re Cannon), an opinion which examines whether third party funds flowing through a debtor's trust accounts can be considered property of the debtor's estate and recoverable as a fraudulent transfer. 277 F.3d 838 (6th Cir.2002). The District Court concluded that Cannon was directly on point with respect to whether the funds in Dayton Title's trust account constitute property of the Debtor's estate and reversed and remanded the issue to this court in order to apply the standard adopted by the Sixth Circuit.
Upon remand and the parties' renewed requests for summary judgment, this court's analysis must begin with the Sixth Circuit's opinion in Cannon. The debtor, Cannon, had been a Tennessee attorney whose practice was mostly limited to real estate closings. Cannon, 277 F.3d at 843. In relation to the closings, between $5,000,000.00 and $10,000,000.00 in third party funds flowed through his trust accounts on a monthly basis. Id. By the mid-1980's, Cannon began embezzling funds to pay various personal and business expenses. Id. He started by misappropriating the "float" in the trust accounts which created a deficiency of approximately $400,000.00 to $500,000.00 in the accounts. Id. However, the volume of Cannon's real estate closing business *868 concealed the shortfall. Id. In October of 1986, Cannon opened a brokerage account with a subsidiary of J.C. Bradford & Co ("J.C.Bradford") to trade commodity futures and began embezzling funds from the escrow accounts to use in the trades. Id. at 843-44. However, Cannon did not realize much of a profit and by the spring of 1992, the deficiency in the accounts reached approximately $1,500,000.00. Id. at 844. As the losses mounted, Cannon could no longer rely on the float to conceal the deficiency in the escrow account. Id. He began holding closing checks to generate float and eventually turned to check kiting to increase the balance in the account. Id.
During the year prior to his bankruptcy, Cannon wrote approximately $1,137,500.00 in checks from the escrow accounts to J.C. Bradford for use in commodities trading. Id. at 845. However, his losses continued to mount and Cannon's scheme eventually came to an end when United American Bank, the bank holding Cannon's principle escrow account, refused to cover overdrafts or transfer funds among his accounts. Id. at 845. Cannon filed for bankruptcy protection in 1994, was disbarred from the practice of law and was sent to prison after pleading guilty in federal court to charges of embezzlement, mail fraud, wire fraud and bank fraud. Id. At the time Cannon filed his bankruptcy petition, the deficiency in his escrow accounts was more than $3,500,000.00. Id.
The Trustee in Cannon's bankruptcy attempted to recover, from J.C. Bradford and other defendants, the $1,137,500.00 which Cannon transferred from the trust accounts in the year prior to filing the bankruptcy petition. Id. at 845-46. The Trustee sought recovery of the funds as a fraudulent transfer under 11 U.S.C. § 548. Id. at 846. The Trustee used a CPA to determine the sources of the funds transferred to J.C. Bradford. Id. at 845-46. The funds came from a $12,000,000.00 pool in the trust accounts that were 83% real estate closing funds, 15% check kites, $67,389.77 of Cannon's personal funds and the balance attributed to unknown sources. Id. at 846.
The Sixth Circuit rejected the Trustee's efforts at recovery of the $1,137,500.00 and held that the funds in the trust accounts were not property of the debtor's estate under the broad definition provided in 11 U.S.C. § 541. Beginning with an analysis of Supreme Court precedent, the Sixth Circuit noted that property held in an express trust for another does not constitute property of a debtor's estate. Id. at 849. The Sixth Circuit looked to state law to determine whether the funds held in Cannon's escrow accounts constitute an express trust. Id. at 849-50. Under Tennessee law, an express trust needs, at a minimum, a grantor or settlor who intends to create a trust, a corpus (the subject property), a trustee, and a beneficiary. Id. at 850 (noting that when "a person has or accepts possession of personal property with the express or implied understanding that he is not to hold it as his own absolute property, but is to hold and apply it for certain specific purposes or for the benefit of certain specified persons, a valid enforceable express trust exists"). The Sixth Circuit concluded that all of these factors were in place with respect to Cannon's escrow account and, thus it constituted an express trust. Id.
The Sixth Circuit analyzed the sources of the funds in the account and concluded that the commingling of funds from different sources did not effect the nature of the account as an express trust under Tennessee law. Id. at 851. Even Cannon's personal deposits into the account, to replace stolen funds, did not give Cannon a property interest in the funds. Id. The Sixth *869 Circuit looked to common law principles to determine that Cannon's vain attempt to repay misappropriated funds was presumed to be restitution for his earlier conversion of funds and, thus, these funds remained outside the debtor's estate. Id. Furthermore, a debtor who misappropriates funds from an escrow account and controls them for his own purposes does not obtain title to the funds. Id. The Sixth Circuit concluded that "[b]ecause Cannon held the funds deposited into his escrow accounts in express trust for his clients, we hold that these monies are not part of his estate in bankruptcy and so [are] not subject to the trustee's avoidance power under section 548." Id.
Based on the standard adopted by the Sixth Circuit in Cannon, and the District Court's instructions on remand, this court must now look to Ohio law[3] to ascertain whether the money transferred to WFC and Wenrick from Dayton Title's trust account was money held in express trust for others. If so, Dayton Title, holding the powers of a trustee, cannot recover the funds on behalf of the bankruptcy estate.
Ohio law on trusts is similar to that of Tennessee and embraces many of the common law principles articulated in Cannon. With respect to the creation of an express trust, the Ohio Supreme Court has held that:
. . . to constitute an express trust there must be an explicit declaration of trust, or circumstances which show beyond reasonable doubt that a trust was intended to be created, accompanied with an intention to create a trust, followed by an actual conveyance or transfer of lawful, definite property or estate or interest, made by a person capable of making a transfer thereof, for a definite term, vesting the legal title presently in a person capable of holding it, to hold as trustee for the benefit of a cestui que trust or purpose to which the trust fund is to be applied; or a retention of title by the owner under circumstances which clearly and unequivocally disclose an intent to hold for the use of another.
Ulmer v. Fulton, 129 Ohio St. 323, 339-40, 195 N.E. 557, 564 (1935) (further citations omitted); Hatch v. Lallo, No. 20642, 2002 WL 462862, at * 1 (Ohio Ct.App. March 27, 2002) (adopting the definition expressed in Ulmer). Essential to the creation of an express trust is the intent of the parties to create a trust, the conveyance or transfer of property, and the contemporaneous designation of a beneficiary. Gottlieb v. Mead Corp., 134 N.E.2d 857, 858 (Ohio Ct.App.1955) (noting that the primary and basic elements of an express trust include a declaration of purpose to create a trust and a designation of a beneficiary or the object of the trust); Whiting v. Bertram, 51 Ohio App. 40, 42, 199 N.E. 367, 367-68 (Ohio Ct.App.1935) (holding that a private trust cannot exist without a cestui que trust). As long as these elements are present, an express trust can be created under less formal circumstances such as when a person accepts possession of money or property for another with the express or implied understanding that he is not to hold it as his own absolute property, but is to hold and apply it for specific purposes. Norris v. Norris, 57 N.E.2d 254, 258-59 (Ohio Ct.App.1943); Huntington National Bank of Columbus v. Roan, 43 N.E.2d 769, 773 (Ohio Ct.App.1931).
1. Application of Ohio Trust Law to the Funds Existing in the Trust Account at the Time of the Transfers
No party disputes that $722,101.49 of the $742,848.62 existing in the trust *870 account at the time of the transfers to Defendants WFC and Wenrick were third party funds held by Dayton Title. Upon examination under Ohio law, the court concludes that these third party funds in Dayton Title's trust account at the time of the transfers to WFC and Wenrick meet the definition of an express trust. Dayton Title created its primary escrow account to set aside and preserve third party money to facilitate real estate closings. Thus, the intention to create the trust is clear. In addition, no party disputes that Dayton Title held this money not as its own, but as a trustee to apply the money for the benefit of designated parties to real estate transactions. Consequently, the third party funds meet the definition of funds held in express trust for others and, under Cannon, those funds are excluded from Dayton Title's bankruptcy estate.[4] For these reasons, summary judgment must be granted to WFC and Wenrick with regard to the third party funds, totaling $722,101.49, that were held by Dayton Title in its escrow account at the time of the transfers.[5]
Also existing in the account at the time of the transfers to Defendants WFC and Wenrick was an additional $20,747.13 that Dayton Title claims ownership of for the first time in a responsive memorandum filed after remand. According to Dayton Title, the funds represent fees earned and expenses to be repaid to Dayton Title in connection with real estate closings and its other functions as a title agency. [Adv. Doc. # 285-1, attached Aff. of Anne Frayne and Ex. C.] However, Defendant Wenrick disputes Dayton Title's ownership of the funds. Defendant Wenrick contends *871 that Dayton Title withdrew all funds it owned prior to the bank freezing the trust account and that the $20,747.13 is third party money.
The court concludes that Dayton Title's evidence is vague and, at best, creates a dispute of fact regarding the ownership of the $20,747.13 commingled with other funds in the escrow account. Because a genuine issue of material fact exists, the ownership of the $20,747.13 cannot be determined on summary judgment. Consequently, the court will deny all parties summary judgment with respect to the $20,747.13 and whether the transfer of the funds to Defendants WFC and Wenrick constitutes a fraudulent conveyance. The issue must proceed to trial.
2. Application of Ohio Trust Law and Article 4 of the UCC to the Provisional Loan
The Defendants argue that, in addition to the funds existing in the account at the time of the transfers, National City Bank's provisional loan of $4,142,151.38 constitutes money held in express trust. Essentially, the Defendants argue that all funds traveling through an account labeled a "trust", "IOTA" or "escrow" account become trust funds regardless of their source or purpose. The Defendants base their argument on Cannon. In that case, the Sixth Circuit did not differentiate between commingled amounts held in a trust account when it concluded that the entire account constituted an express trust. However, in Cannon, the Sixth Circuit determined that all of the commingled money was, in fact, being held for third parties. 277 F.3d at 850-851. Even the deposits made from Cannon's own funds were considered restitution under Tennessee state law and, thus, assumed the characteristics of trust funds. Id. at 851. The Sixth Circuit did not directly address the question of how to treat a provisional loan from a bank that travels through a trust account, but is never held in express trust for any specified third party beneficiary.[6]
Dayton Title's property interest in the provisional loan must be determined under state law. Under Ohio law, the labeling of an account does not effect the nature of the funds it contains even if those funds are commingled. Ohio courts have held that the commingling of trust funds and nontrust funds does not change the characteristics of either set of funds, at least to the extent that they remain traceable. See Smith v. Fuller, 86 Ohio St. 57, 67-8, 99 N.E. 214, 217 (Ohio 1912); Ginn v. Fulton, 17 Ohio Law Abs 499, 1934 WL 1764, at *4 (Ohio Ct.App.1934). The fact that general funds are placed into a "trust" account does not make them funds held in express trust for others anymore than the misappropriation of trust funds and their placement into a general account would somehow cause that money to lose its trust fund characteristics, as long as the trust funds can be traced. Id.
In other words, the fact that the provisional loan from National City Bank was channeled through a trust account does not make the loan proceeds funds held "in express trust for others." To be considered trust funds, the loan proceeds would have to meet the definition of an express trust under Ohio law including the intention *872 of the parties to create a trust relationship with regard to the funds and the designation of a beneficiary to the funds. No party has demonstrated such evidence.
Instead, the evidence on summary judgment supports that National City Bank provided provisional credit for Chari's check deposited in Dayton Title's escrow account pursuant to the bank's "Rules for Business Accounts" attached to its proof of claim. Chari gave specific instructions to Dayton Title to pay the $4,885,000.00 to WFC and Wenrick. Because Dayton Title acted with regard to Chari's specific instructions, Defendants argue that a trust relationship was created. However, the trust relationship, if one had been created, would have been between Chari and Dayton Title and, then, only to the extent Chari's check resulted in a lawful conveyance of property. Because this did not occur, no trust relationship was created between Chari and Dayton Title.[7]
With respect to the provisional loan provided by National City Bank to cover the negative balance created by Chari's returned check, no evidence of a trust relationship has been presented on summary judgment. National City Bank asserts that pursuant to its Rules for Business Accounts, Dayton Title could have used the provisional loan proceeds for any purpose, or paid the funds to any entity, with the acknowledgment that use of the proceeds created an obligation on the part of Dayton Title to repay the provisional loan. Consequently, the provisional loan by National City Bank created a debt relationship rather than a trust relationship between Dayton Title and National City Bank.
In response, the Defendants argue that even if the provisional loan was not an express trust, Dayton Title cannot recover the loan proceeds because the proceeds represent the collateral of a fully secured creditor. The Defendants assert that National City's secured status arises by operation of Article 4 of the Uniform Commercial Code, codified by an Ohio statute which provides that a "collecting bank has a security interest in an item . . . or the proceeds of the item . . . [i]n the case of an item deposited in an account, to the extent to which credit given for the item has been withdrawn or applied. . . ." Ohio Rev.Code § 1304.20(A)(1) (codifying U.C.C. § 4-210(A)(1)). They argue that under the Sixth Circuit's 2001 decision in First Tennessee Bank, a separate adversary proceeding in the Cannon bankruptcy case, the Article 4 security interest extends to the proceeds of the provisional credit in whatever form those proceeds take. See First Tennessee Bank v. Stevenson (In re Cannon), 237 F.3d 716, 721 (6th Cir.2001). Because of this security interest, the Defendants argue that Dayton Title had, at best, bare legal title to the proceeds transferred to WFC and Wenrick. Consequently, Dayton Title does not have the power or authority to recover the proceeds on behalf of the secured creditor when the collateral will not be distributed to general unsecured creditors of the estate. See Pioneer Liquidating Corp. v. San Diego Trust & Savings Bank (In re Consolidated Pioneer Mortgage Entities), 211 B.R. 704, 712 (S.D.Cal.1997), partially rev'd on other grounds, 166 F.3d 342, 1999 WL 23156 (9th Cir. Jan 13, 1999).
*873 The court disagrees with the Defendants' argument and concludes that the security interest created by operation of Ohio law is more limited than the Defendants have proposed. The security interest follows the loan proceeds, or other monies, only to the extent that funds remain or are later deposited in a bank account with the collecting bank. See Ohio Rev.Code § 1304.20(B) (explaining the "first in, first out" rule). The limit of National City's security interest is further explained in the bank's Rules for Business Accounts. Rule 13 states that "Depositor grants a security interest in the Account to Bank for any and all indebtedness owed by Depositor to Bank or to Bank's affiliates, however and whenever incurred or evidenced." (See National City's Rules for Business Accounts attached to Proof of Claim # 48) (emphasis added). Since no funds existed in the account at the time of the bankruptcy filing, and the account has now been closed, National City Bank will never realize a security interest in the proceeds of the provisional loan transferred to Defendants WFC and Wenrick, even if those funds are returned to Dayton Title's bankruptcy estate. Instead, National City Bank has an unsecured claim and this status has been admitted by National City Bank in its proof of claim.
Because National City asserts only an unsecured claim in Dayton Title's bankruptcy case, the provisional loan is treated like any unsecured loan used by a debtor. This asset meets the broad definition of property of the estate under 11 U.S.C. § 541. Consequently, Dayton Title has the power, as Debtor-in-Possession, to recover the proceeds under a fraudulent transfer theory.
C. Recovery of the Provisional Loan Under the UFTA
The provisional loan proceeds transferred to Defendants WFC and Wenrick meet the definition of property of the estate and, consequently the court must progress with an analysis of whether Dayton Title meets the other elements for recovery of the transfer under the Ohio Uniform Fraudulent Transfer Act ("UFTA"), Ohio Rev.Code §§ 1336.01 et seq. This court already determined that Dayton Title met the elements for recovery prior to remand. Because the District Court did not review these other elements on appeal and because the parties provide very little additional analysis within their supplemental briefs, the court adopts its previous conclusion that Dayton Title meets the elements for recovery of the provisional loan as a fraudulent transfer under the UFTA. For the benefit of the parties, the court will reiterate its analysis within this decision.
The significant provision of the UFTA is Ohio Rev.Code § 1336.04 which provides, in pertinent part:
(A) A transfer made or an obligation incurred by a debtor is fraudulent as to a creditor, whether the claim of the creditor arose before or after the transfer was made or the obligation was incurred, if the debtor made the transfer or incurred the obligation in either of the following ways:
(1) With actual intent to hinder, delay, or defraud any creditor of the debtor;
(2) Without receiving a reasonably equivalent value in exchange for the transfer or obligation, and if either of the following applies:
(a) The debtor was engaged or was about to engage in a business or a transaction for which the remaining assets of the debtor were unreasonably small in relation to the business or transaction;
*874 (b) The debtor intended to incur, or believed or reasonably should have believed that he would incur, debts beyond his ability to pay as they became due.
Ohio Rev.Code § 1336.04(A). While § 1336.04(A)(1) covers claims of actual fraud, § 1336.04(A)(2) has a broader scope encompassing claims of constructive fraud where the focus is on the effect of the transaction rather than the intent with which it was undertaken. Aristocrat Lakewood Nursing Home v. Mayne, 133 Ohio App.3d 651, 667, 729 N.E.2d 768, 780 (Ohio Ct.App.1999). In fact, a constructive fraud claim under § 1336.04(A)(2) may exist even without any intent on the part of the debtor to hinder, delay, or defraud a creditor. Id.
Dayton Title focuses specifically on the unreasonably small asset theory of § 1336.04(A)(2)(a). Under this provision, the party attempting recovery must prove that the debtor transferred an interest in its property for less than reasonably equivalent value leaving it with unreasonably small assets compared to the debtor's "historical level of assets or cash flow and current needs." Mayne, 133 Ohio App.3d at 668, 729 N.E.2d at 780. This very broad provision does not require proof of any mental state on the part of the debtor. Id.
Because the court has already concluded that a property interest of Dayton Title was transferred to WFC and Wenrick, the court need only reiterate its previous analysis with respect to the other two elements.
1. Dayton Title Received No Reasonably Equivalent Value in Exchange for the Transfer of Funds to WFC and Wenrick
In order to prevail on its fraudulent transfer claim under Ohio's UFTA, Dayton Title must establish that it received nothing of reasonably equivalent value in exchange for the transfer of funds to WFC and Wenrick. Ohio Rev.Code § 1336.04(A)(2). To assess whether a challenged transfer is supported by reasonably equivalent value, "courts generally compare the value of the property transferred with the value of that received in exchange for the transfer." Corzin v. Fordu (In re Fordu), 201 F.3d 693, 707 (6th Cir.1999). It is not necessary for there to be "mathematical precision" or a "penny-for-penny" exchange in order to establish reasonably equivalent value. Coan v. Fleet Credit Card Services, Inc. (In re Guerrera), 225 B.R. 32, 36 (Bankr.D.Conn.1998). However, courts should keep the equitable purposes behind fraudulent transfer law in mind, recognizing that any significant disparity between the value received and the value surrendered will significantly harm innocent creditors. Id.
With respect to the provisional loan proceeds, Dayton Title demonstrated that the transfer created a negative balance in its trust account and a $4,142,151.38 claim against it by National City Bank. In exchange, Dayton Title asserts that it received nothing of value from WFC and Wenrick. WFC and Wenrick disagree noting that they deposited a total of $4,800,000.00 in Dayton Title's trust account on September 3, 1999 representing the proceeds from their final bridge loans to Invesco. They argue that no documentary evidence supports that Dayton Title disbursed that money. Thus, the funds they initially deposited constitute reasonably equivalent value to what they received in the transfer.
If Dayton Title failed to disburse the $4,800,000.00 in loan proceeds received from WFC and Wenrick, this could amount to reasonably equivalent value for *875 Dayton Title's loss. However, in response to WFC and Wenrick's argument, Dayton Title submits evidence, in the form of Pam Folino's affidavit, bank records and Dayton Title's Escrow Account Ledgers, demonstrating that the loan proceeds from WFC and Wenrick were, in fact, disbursed. [Adv. Doc. # 136-1, Folino Aff. attached at Ex. B and attached Exs. 1-6.] The $3,200,000.00 in Invesco loan proceeds which Dayton Title received from WFC on September 3, 1999 was wire transferred from the trust account to John Lewis on the same day. [Id., Folino Aff. and attached Exs. 1 and 2.] In addition, Dayton Title disbursed the $1,600,000.00 in Invesco loan proceeds received in two wire transfers from Wenrick as follows: 1) $1,500,000.00 to John Lewis; 2) $34,000.00 to McDuffie Construction Management Group; and 3) $66,000.00 to Invesco. [Id., Folino Aff. and attached Exs. 3-6.] WFC and Wenrick have provided no evidence to contradict these facts. Because Dayton Title retained none of the funds loaned to Invesco by WFC and Wenrick, the loan proceeds do not constitute reasonably equivalent value for Dayton Title's loss.
Next, WFC and Wenrick request the court to consider indirect benefits received by Dayton Title as reasonably equivalent value. WFC and Wenrick note the significant value Dayton Title placed on its business relationship with Chari. Even before the transactions with WFC and Wenrick, Dayton Title allowed Chari to have substantial extensions of credit by floating returned checks with other funds in the trust account in exchange for Chari's continued business. They assert that the transactions involving WFC and Wenrick, channeled through the trust account, enabled Dayton Title to facilitate this business relationship with Chari believed to be financially advantageous.
WFC and Wenrick are correct that courts should analyze both direct and indirect benefits to a debtor in determining whether reasonably equivalent value has been received. Enwotwen Indus., Inc. v. Brookstone Limited Partnership (In re Newtowne), 157 B.R. 374, 378-79 (Bankr.S.D.Ohio 1993). However, the economic value of any indirect benefits must be fairly concrete and quantifiable to merit consideration by the court. SPC Plastics Corp. v. Griffith (In re Structurelite Plastics Corp.), 224 B.R. 27, 31 (6th Cir. BAP 1998) (noting that the speculative value of indirect benefits like the opportunity to acquire additional loans or new managerial talent does not constitute fair consideration); Leonard v. Norman Vinitsky Residuary Trust (In re Jolly's Inc.), 188 B.R. 832, 843 (Bankr.D.Minn.1995) (noting that the defendant-creditors carry the "burden of production as to the concreteness of the indirect benefit, and its reasonable equivalence of value").
While goodwill and the continuation of business relationships can be indirect benefits to a business debtor, WFC and Wenrick have not attempted to measure or quantify the economic value of Dayton Title's continued relationship with Chari. Instead, they only speculate, without evidentiary support, that the value of Dayton Title's ongoing relationship with Chari is reasonably equivalent to the $4,142,151.38 loss experienced by Dayton Title forcing it to close its doors and seek bankruptcy protection. The court finds this assertion too speculative to merit consideration. Consequently, the court concludes that Dayton Title received no reasonably equivalent direct or indirect benefit for the $4,142,151.38 transferred to WFC and Wenrick.
2. The Transfer Left Dayton Title with An Unreasonably Small Amount of Assets in Relation to the Transaction
The next element of the UFTA requires Dayton Title to demonstrate that *876 the debtor engaged in a transaction "for which the remaining assets of the debtor were unreasonably small in relation to . . . the transaction[.]" Ohio Rev.Code § 1336.04(A)(2)(a). The unreasonably small asset theory under this provision is the broadest kind of fraudulent conveyance claim applying when the "debtor is left with unreasonably small assets, compared to his historical level of assets or cash flow and current needs." Aristocrat Lakewood Nursing Home v. Mayne, 133 Ohio App.3d 651, 668, 729 N.E.2d 768, 780 (Ohio Ct.App.1999). Care must be taken, however, not to invalidate "all transfers simply because a debtor subsequently happened to encounter financial problems." Id.
Dayton Title's financial problems did not simply occur as a coincidence after the transfer to WFC and Wenrick. Its problems were a direct result of the transfer of funds from the trust account. By transferring the provisional loan proceeds, National City obtained a $4,142,151.38 claim against Dayton Title that did not exist prior to the transfer. The transfer not only depleted Dayton Title's assets, but destroyed its ability to continue in business. The court concludes that the transfer of funds left Dayton Title with unreasonably small assets, so that Dayton Title meets this final element of a fraudulent conveyance under Ohio's UFTA.
3. Prejudgment Interest and Costs
Prior to remand, Dayton Title asserted that the estate should be entitled to costs, attorney fees and interest on the award, at the Ohio statutory rate of 10% per annum, calculated from October 19, 1999, the date of the fraudulent transfer to WFC and Wenrick. WFC and Wenrick did not respond to Dayton Title's request in their memoranda prior to remand.
With respect to prejudgment interest, the Bankruptcy Code does not address such an award in actions to avoid fraudulent transfers. In the absence of a statutory prohibition, a trial court may exercise its discretion to award prejudgment interest taking into consideration the relative equities of the parties and the need to fully compensate the debtor's estate for the use of funds for the period of time they were withheld from the estate. Yoder v. T.E.L. Leasing, Inc. (In re Suburban Motor Freight, Inc.), 124 B.R. 984, 1005-06 (Bankr.S.D.Ohio 1990). The good faith dispute over the funds being property of the estate does not warrant a different result. Hunter v. Patton (In re Patton) 200 B.R. 172, 178 (Bankr.N.D.Ohio 1996). For these reasons, the court will award Dayton Title prejudgment interest to compensate the estate for its loss of the use of the funds transferred to WFC and Wenrick while this litigation proceeded.
Although Dayton Title requested prejudgment interest to run from the date of the transfer to WFC and Wenrick, prejudgment interest is generally awarded from the date of the demand on the defendants or, absent this, the date the adversary proceeding was filed. Suburban Motor Freight, 124 B.R. at 1006. In this case, Dayton Title provides no demand date. Thus, the court concludes that the appropriate date for the accrual of prejudgment interest to begin is the date the adversary proceeding was initiated.
In conclusion, the court grants prejudgment interest to the Plaintiff, Dayton Title, running from the date the adversary complaint was filed on November 10, 1999. The applicable rate of interest shall be the rate set forth in 28 U.S.C. § 1961(a). See Id. at 1006; Hunter v. Patton (In re Patton), 200 B.R. at 178; Sicherman v. Jelm (In re Harvard Manufacturing Corp.), 97 B.R. 879, 884 (Bankr.N.D.Ohio.1989).
*877 Furthermore, Plaintiff Dayton Title is awarded court filing costs. The court deems an award of attorney fees or other costs to the Plaintiff to be inappropriate.
D. Analysis of Whether DTABT Constitutes a Business Trust in Bankruptcy
The other issue remanded by the District Court is whether Dayton Title Agency, Inc. Business Trust ("DTABT") is a business trust so as to be eligible for separate bankruptcy relief from Dayton Title. The issue arises because only "persons" are eligible to seek bankruptcy relief. 11 U.S.C. § 109. The definition of the term "persons" includes "corporations" (see 11 U.S.C. § 101(41)) and "corporations" are, in turn, defined to include "business trusts." 11 U.S.C. § 101(9)(A)(v). However, the term "business trust" is not defined within any section of the Bankruptcy Code. Consequently federal courts generally look to either state law for a definition or they create their own.
In its first decision on summary judgment, this court concluded that DTABT was not a true business trust and was ineligible for separate bankruptcy relief from Dayton Title. To make its determination, this court looked to an unpublished Sixth Circuit opinion, Brady v. Schilling (In re Kenneth Allen Knight Trust), No. 96-5353, 1997 WL 415318 (6th Cir. July 22, 1997). In this opinion, the Sixth Circuit determined that for a trust to meet the definition of a business trust it must have attributes of a corporation and be created with the primary purpose of transacting business or carrying on commercial activity for the benefit of investors. Id. at *3-4.
Using the Sixth Circuit's analysis, this court determined that DTABT was not a business trust because DTABT was merely the name given to Dayton Title's trust accounts and it lacked the attributes of a corporation. The evidence on summary judgment supported that DTABT had no written agreement or articles of incorporation memorializing its creation, it had no principals, officers or employees, and it had no tax identification number separate from that of Dayton Title. Furthermore, DTABT did not generate income or carry on business separate from Dayton Title.
On appeal, the District Court vacated this court's determination and remanded the issue for this court to consider the clarification of the definition of a business trust in Brady-Morris v. Schilling (In re Kenneth Allen Knight Trust), 303 F.3d 671 (6th Cir.2002), a recently published Sixth Circuit opinion. In Brady-Morris, the Sixth Circuit reiterated the standard articulated in its 1997 unpublished opinion (from the same case) and clarified that the standard for determining whether an entity is a business trust consists of two propositions:
first, `trusts created with the primary purpose of transacting business or carrying on commercial activity for the benefit of investors qualify as business trusts, while trusts designed merely to preserve the trust res for beneficiaries generally are not business trusts'; and second, `the determination is fact-specific, and it is imperative that bankruptcy courts make thorough and specific findings of fact to support their conclusions' findings, that is, regarding what was the intention of the parties, and how the trust operated.
Kenneth Allen Knight Trust, 303 F.3d at 680 (further citations omitted).
Dayton Title argues that DTABT meets this definition because the primary purpose of the trust accounts is to conduct business activity on behalf of Dayton Title and facilitate its real estate closings. In *878 support, Dayton Title focuses on DTABT's almost daily transactions representing the third party funds deposited into and disbursed from the trust accounts. However, these transactions denote nothing more than the obtaining and disbursing of the trust res, an activity which is inherent to all trusts. What Dayton Title's analysis ignores is that the type of commercial activity that separates a business trust from a trust to preserve the trust res is activity designed to benefit "investors." Id. Thus, a business trust must not only hold and disburse funds, but also be used to provide a profit to or increase in the assets of investors. See Id., n. 1.
Dayton Title has identified no profit-making function of the trust accounts nor any entities that could be considered investors. Dayton Title attempts to argue that it is the "investor" making a profit by earning closing fees and premiums for issuing title insurance policies. However, the funds in the trust accounts are only incidental to the profit making function of the title company itself. In fact, Dayton Title has not disputed the Defendants' contention that the title company is prohibited from using the third party trust funds for investments or the interest earned on the account for any direct profit making activity. The court agrees with the Defendants' conclusion that DTABT is nothing more than the bank accounts designed to preserve the trust res, i.e. to collect and disburse third party funds incidental to Dayton Title's real estate closings and title insurance business. Consequently, DTABT does not qualify as a "business trust" and its bankruptcy case is dismissed.
CONCLUSION
In conclusion, the court makes the following determinations:
1. The third party funds, totaling $722,101.49, meet the definition of funds held in express trust for others and are excluded from Dayton Title Agency, Inc.'s bankruptcy estate. For these reasons, summary judgment must be granted to Defendants, The White Family Companies, Inc. and Nelson Wenrick, with regard to the third party funds.
2. A dispute of fact exists regarding ownership of $20,747.13 in funds existing in the account at the time of the transfers to Defendants, The White Family Companies, Inc. and Nelson Wenrick. The court denies summary judgment to all parties with regard to these funds. The issue of ownership of the $20,747.13 and whether its transfer constitutes a fraudulent conveyance must proceed to trial. The court schedules a pretrial conference on Tuesday, May 13, 2003 at 10:00 a.m. in its courtroom to establish a discovery deadline and trial date.
3. The factual evidence provided on summary judgment supports that National City Bank's provisional loan, amounting to $4,142,151.38, does not meet the definition of an express trust. Furthermore, National City Bank has only an unsecured claim in Dayton Title's bankruptcy for the loan proceeds. Consequently, the court concludes that the loan proceeds constitute property of the estate under 11 U.S.C. § 541 and Dayton Title retains the power to recover the proceeds from Defendants, The White Family Companies, Inc. and Nelson Wenrick, as a fraudulent transfer.
4. With regard to the proceeds from National City Bank's provisional loan, the court adopts its previous *879 conclusion that Dayton Title meets every element for recovery of the proceeds under the Ohio Uniform Fraudulent Transfer Act ("UFTA"), Ohio Rev.Code §§ 1336.01 et seq. Consequently, the court grants summary judgment to Plaintiff Dayton Title Agency, Inc., as Debtor-in-Possession, on its claim for recovery of the $4,142,151.38 in provisional loan proceeds from Defendants, The White Family Companies, Inc. and Nelson Wenrick. The court, again, determines National City Bank's separate motion for summary judgment on the same funds to be moot.
5. The judgment shall be divided between the Defendants proportionately based on the total amount each Defendant received from Dayton Title in the transfers. Defendant Nelson Wenrick's share of the judgment debt is $1,379,336.41 and Defendant The White Family Companies, Inc.'s share is $2,762,814.97.
6. The evidence provided on summary judgment supports that Dayton Title Agency, Inc. Business Trust does not meet the definition of a "business trust" for bankruptcy purposes and is ineligible to file a bankruptcy petition separate from Dayton Title Agency, Inc. Consequently, its bankruptcy case is dismissed.
7. The court grants prejudgment interest to Plaintiff Dayton Title Agency, Inc. from November 10, 1999 to the date of the judgment at the rate established in 28 U.S.C. § 1961(a) and court filing costs.
It is so ordered.
NOTES
[1] Because they contain identical claims against WFC and Wenrick, the two adversary proceedings of Dayton Title Agency, Inc. (Adv.# 99-3664) and Dayton Title Agency, Inc. Business Trust (Adv.# 99-3663) have been jointly administered for procedural purposes with filings located in Adv. # 99-3664.
[2] From its analysis of the case law prior to remand, the court concluded that when a bank account is used merely as a conduit of third party money, the debtor has no property interest in the account funds. McLemore v. Third National Bank in Nashville (In re Montgomery), 983 F.2d 1389, 1395 (6th Cir.1993); Nordberg v. Sanchez (In re Chase & Sanborn Corp.), 813 F.2d 1177, 1181-82 (11th Cir.1987). Thus, in situations when a third party lends money to a debtor for the intended purpose of paying a selected creditor of the third party, the debtor does not exercise control over, and has no interest in, the earmarked funds channeled through the debtor's account. Id. In the case at hand, however, Chari's $5,000,000.00 check, representing the funds to be used by Dayton Title to pay WFC and Wenrick, bounced. Thus, the funds used to pay the selected creditors were not Chari's funds funneled through Dayton Title's account. Instead, WFC and Wenrick were paid from two sources: 1) $742,848.62 in funds held by Dayton Title in its escrow account; and 2) approximately $4,142,151.38 from a provisional loan of National City Bank needed to cover the overdraft created in the account after the escrow funds were exhausted. Under the conduit theory, this court concluded that because Dayton Title paid WFC and Wenrick from these other unintended sources, the trust account was not a mere conduit of Chari's funds. Thus, Dayton Title had a property interest in the funds that could be recovered from WFC and Wenrick on behalf of Dayton Title's estate.
[3] All parties agree that the controlling state law in this case is Ohio law.
[4] Dayton Title attempts to argue that under Ohio law, a trustee of an escrow account obtains a property interest in the funds via the trustee's fiduciary duty to preserve and protect the trust property. Smith v. Fuller, 86 Ohio St. 57, 62, 99 N.E. 214, 216 (1912). The fiduciary rights and duties of a trustee include the ability to prosecute and defend actions in the interest of the trust's beneficiaries. See Ohio R. Civ. P. 17(A); In re First National Bank of Mansfield, 37 Ohio St.2d 60, 66, 307 N.E.2d 23, 26 (1974). According to its argument, Dayton Title should be able to use its fiduciary duty toward the escrow funds to recover the funds on behalf of the beneficiaries in bankruptcy as it could outside of bankruptcy under state law. Dayton Title's argument was rejected by the Sixth Circuit in Cannon which pointed out the differences between the powers of a trustee in bankruptcy and those of a fiduciary outside of bankruptcy. The Sixth Circuit noted that a trustee in bankruptcy is a creature of statute and has only those powers conferred by the Bankruptcy Code. 277 F.3d at 853. While one power conferred on the bankruptcy trustee is the right to pursue causes of action that the debtor could pursue outside of bankruptcy, this power is limited to causes of action that recover assets for the bankruptcy estate. Id. The issue becomes complicated when a debtor-fiduciary's cause of action pursuable outside of bankruptcy is on behalf of the third party beneficiaries of an express trust. Id. at 853-55. Although a fiduciary of an escrow account may have the ability to recover funds held in trust on behalf of the third party beneficiaries of the trust, those funds would not become part of the fiduciary's bankruptcy estate. Id. Because the cause of action to recover trust funds on behalf of third party beneficiaries could not be used to bring assets into the bankruptcy estate directly, the Sixth Circuit held that the bankruptcy trustee lacked standing to pursue the action in bankruptcy. Id.
[5] Although Dayton Title lacks the power or authority to recover the third party funds held in express trust, the more than thirty (30) third party beneficiaries, who are claimants in Dayton Title's bankruptcy, are not without remedy. As noted in Cannon, the beneficiaries of funds held in an escrow account may pursue their own cause of action against Defendants WFC and Wenrick in state court. 277 F.3d at 856. Although the overall effect of requiring these thirty (30) or more beneficiaries to pursue their own causes of action in state court creates a multiplicity of suits, this result is necessitated by Cannon and the limits of the bankruptcy court's authority.
[6] The Defendants do note that in Cannon, at least some part of the account funds were from kited checks and, thus, may have constituted provisional loans from a bank. However, the Sixth Circuit never addressed how such funds could be considered trust funds, and, even if the question had been directly addressed, the case dealt with the treatment of funds under Tennessee law rather than Ohio law. Consequently, this court finds that Cannon is not on point with respect to the treatment of National City Bank's provisional loan.
[7] Clearly, Chari meant to create a trust relationship between himself and Dayton Title with respect to the $5,000,000.00 check deposited in the escrow account. However, one requirement of an express trust is that an actual conveyance or transfer of lawful and definite property occur. Ulmer v. Fulton, 129 Ohio St. 323, 339-340, 195 N.E. 557, 564 (1935). In this case, the $5,000,000.00 check was returned because it was drawn on a fictitious account. Consequently, no property was conveyed by Chari and no trust relationship was created.
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813 P.2d 797 (1991)
The PEOPLE of the State of Colorado, Plaintiff-Appellee,
v.
John FASY, Defendant-Appellant.
No. 89CA0463.
Colorado Court of Appeals, Div. IV.
February 14, 1991.
Rehearing Denied March 14, 1991.
Certiorari Granted August 5, 1991.
*798 Duane Woodard, Atty. Gen., Charles B. Howe, Chief Deputy Atty. Gen., Richard H. Forman, Sol. Gen., Douglas J. Friednash, Asst. Atty. Gen., Denver, for plaintiff-appellee.
David F. Vela, Colorado State Public Defender, Frances Smylie Brown, Chief Appellate Deputy Public Defender, Denver, for defendant-appellant.
Opinion by Judge CRISWELL.
Defendant, John Fasy, appeals a judgment of conviction of sexual assault on a child. He argues, among other things, that the trial court erred in allowing an expert to give an opinion that the alleged victim suffered from post-traumatic stress syndrome and in admitting the hearsay testimony of certain witnesses. Because we conclude that, under the circumstances here, the admission of the expert testimony was improper, we reverse and remand for a new trial.
The young child in this case did not report the alleged sexual assault for a period of approximately three years. During this period, there was evidence that she suffered from sleeplessness, nightmares, and vomiting. She was treated for these symptoms by the same psychologist who later testified for the prosecution. After reporting the alleged assault, her nausea ceased and her sleeping habits improved.
At trial, the child was the first witness presented. She testified that she had not previously reported the assault because the defendant had threatened to kill her mother if she told anyone about the incident. She also testified that, at the time of the incident, she did not understand that defendant's actions were "wrong."
After the child's testimony, the prosecutor called several witnesses who testified pursuant to § 13-25-129, C.R.S. (1987 Repl. Vol. 6A), to various out-of-court statements that the child had made to them. These statements were generally consistent with the child's testimony.
One of these witnesses was the treating psychologist, who described the course of his counseling sessions with the child. He testified that, when he first began counselling her, she was sad, anxious, depressed, and reluctant to speak with him. Nevertheless, over a number of visits she described to him one specific instance of sexual assault by the defendant. He repeated this detailed statement to the jury. This witness also described the symptoms of post-traumatic stress syndrome, which he stated may be caused by a sexual assault and which include symptoms consistent with those he described the child as having. He was then allowed to opine that the child was presently suffering from this disorder.
I.
Defendant first argues that the trial court erred in admitting the testimony of the psychologist that the victim was presently suffering from a post-traumatic stress disorder. He contends such testimony should not have been admitted because it was the equivalent of a statement that the child was telling the truth about the alleged sexual assault. In light of the nature of the other testimony given by this same witness, we agree.
Generally, testimony that describes the reactions of other victims of sexual assaults is admissible only to support the victim's credibility after an attack has been made upon her character for truthfulness. People v. Snook, 745 P.2d 647 (Colo.1987). See Tevlin v. People, 715 P.2d 338 (Colo. 1986). Cf. People v. Hampton, 746 P.2d 947 (Colo.1987) (in case of alleged sexual assault on adult, general explanation of reactions of persons suffering from rape trauma syndrome admissible to explain victim's delay in reporting assault).
However, even in those instances in which such evidence is admissible to rebut adverse character evidence, it is impermissible to allow a witness expressly to assert that the victim was being truthful on a specific occasion. People v. Koon, 713 P.2d 410 (Colo.App.1985) (Koon I); People *799 v. Koon, 724 P.2d 1367 (Colo.App.1986) (Koon II).
And, even though the testimony contains no express assertion of the victim's truthfulness, testimony that amounts to an implied assertion of truthfulness is also improper. People v. Snook, supra.
In regard to the issue of an implicit affirmation of a child's truthfulness, this court has previously held that an expert's testimony to the effect that a child's demeanor and manner is consistent with the demeanor and reactions of other victims of sexual assault is not the testimonial equivalent of an assertion that the child was telling the truth on a particular occasion. People v. Pronovost, 756 P.2d 387 (Colo. App.1987), aff'd on other grounds, 773 P.2d 555 (Colo.1989). However, the Colorado Supreme Court has recently suggested that such testimony may be improper. See People v. Newbrough, 803 P.2d 155 (Colo. 1990) (expert testimony that child's symptoms were consistent with those of other minor victims of sexual assaults "may be" interpreted as improper comment on truthfulness of child).
Here, the expert testimony went beyond a mere general description of the reactions of minor victims of sexual assault. Indeed, it even went beyond the expression of an opinion that the child evidenced such reactions and was suffering from post-traumatic stress syndrome.
Prior to expressing this opinion, this same expert witness had repeated to the jury a detailed, accusatory statement made to him by the child, which statement was offered for its truth pursuant to § 13-25-129. Given this testimony, therefore, when the witness then offered the opinion that the child was, in fact, suffering the after-effects of a prior sexual assault, such opinion must necessarily have conveyed to the jury the message that the expert considered the child's report to be truthful. See People v. Snook, supra.
Thus, the testimony given by the expert here went beyond even that approved in People v. Pronovost, supra. And, by allowing the same witness who testified respecting a detailed accusatory statement implicating defendant also to express the opinion that the child was suffering from a post-traumatic stress syndrome, the court erred.
Further, given the record here, we cannot say that the admission of this testimony was harmless error. There was no physical evidence that corroborated the child's statements. Thus, the verdict was dependent upon the jury's determination of the child's credibility, and the expert's testimony was the equivalent of a statement that, in his opinion, the victim was telling the truth on the specific occasion in question. This testimony not only bolstered the child's testimony, it also gave added weight to the accusatory statements the child had made to other witnesses, which those statements otherwise would not have possessed. Under such circumstances, the evidence of defendant's guilt was not so overwhelming that this error may be considered as not having substantially influenced or affected the fairness of the trial proceedings. Cf. Tevlin v. People, supra. Accordingly, defendant's conviction of sexual assault must be reversed.
II.
In regard to a matter that may arise on retrial, defendant contends that the trial court erroneously admitted testimony concerning out-of-court statements made by the child to her mother, to her psychologist, and to a school counselor. Although these hearsay statements were admitted by the trial court under § 13-25-129, C.R.S. (1987 Repl.Vol. 6A), the defendant argues that they should have been excluded under CRE 403 because their probative value was substantially outweighed by their unfair prejudicial effect. We perceive no error.
Initially, we shall assume, without deciding, that statements that would otherwise be admissible under § 13-25-129 may, nevertheless, be excluded if CRE 403 would require it. But see People v. Bowers, 801 P.2d 511 (Colo.1990) (statute controls over CRE 804(b)(5)); People v. Diefenderfer, 784 P.2d 741 (Colo.1989) (statute controls over CRE 803(24)). We conclude, however, *800 that CRE 403 does not require the statements' exclusion in this case.
For relevant evidence to be excluded pursuant to CRE 403, its probative value must be substantially outweighed by the danger of unfair prejudice, and the party opposing its admission must overcome the presumption in favor of the admission of relevant evidence. Koehn v. R.D. Werner Co., 809 P.2d 1045 (Colo. 1990).
All effective evidence is prejudicial in the sense that it is damaging to the party against whom it is being offered. Generally, however, exclusion is required only if the evidence has some undue tendency to suggest a decision on an improper basis, commonly an emotional basis, such as bias, sympathy, hatred, contempt, retribution, or horror. Koehn, supra.
The decision whether to admit evidence is within the sound discretion of the trial court, and its determination will not be overturned on appeal unless an abuse of that discretion is shown. People v. Henderson, 794 P.2d 1050 (Colo.App.1989).
Here, there was no such abuse of discretion. While the child's out-of-court statements were prejudicial to defendant in the sense that they tended to establish his guilt, we discern no unfair prejudice resulting from their admission.
Defendant does not contend that there were insufficient indicia of reliability concerning the child's out-of-court statements to permit their admission under § 13-25-129. Since these statements were all admissible under that statute, the burden was on defendant to show that there was some basis for refusing to admit them. However, beyond the conclusionary statement that the evidence was prejudicial and cumulative, defendant has provided no justification for overturning the court's action in admitting this evidence. Therefore, we conclude that the admission of these hearsay statements was proper.
III.
By virtue of our holding above, defendant's additional contention that the trial court erred in refusing to provide him with a transcript of the motions hearing is rendered moot and need not be addressed by us.
The judgment of conviction is reversed, and the cause is remanded for a new trial.
MARQUEZ and DAVIDSON, JJ., concur.
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IN THE COURT OF CRIMINAL APPEALS OF TENNESSEE
AT NASHVILLE FILED
JUNE 1998 SESSION
October 12, 1998
Cecil W. Crowson
Appellate Court Clerk
STATE OF TENNESSEE, )
) C.C.A. NO. 01C01-9704-CC-00136
Appellee, )
) RUTHERFORD COUNTY
VS. )
) HON. JAMES K. CLAYTON, JR.,
RICKY RAYMOND BRYAN, ) JUDGE
)
Appellant. ) (First-Degree Murder)
FOR THE APPELLANT: FOR THE APPELLEE:
GERALD L. MELTON JOHN KNOX WALKUP
District Public Defender Attorney General & Reporter
201 West Main St., Suite 101
Murfreesboro, TN 37130 LISA A. NAYLOR
(On Retrial and On Appeal) Asst. Attorney General
John Sevier Bldg.
BRAD W. HORNSBY 425 Fifth Ave., North
P.O. Box 398 Nashville, TN 37243-0493
Murfreesboro, TN 37133-0398
(At First Trial) WILLIAM WHITESELL
District Attorney General
Third Floor Judicial Bldg.
Murfreesboro, TN 37130
OPINION FILED:____________________
REVERSED AND REMANDED FOR A NEW TRIAL
JOHN H. PEAY,
Judge
OPINION
The defendant was indicted for and found guilty of first-degree murder.
Following a hearing, the defendant was sentenced to life imprisonment. In this appeal
as of right, the defendant presents the following issues for review:
I. Whether retrial of the defendant violated his constitutional
protections against double jeopardy;
II. Whether the trial court erred in failing to suppress statements the
defendant made to various law enforcement officers;
III. Whether the trial court erred in failing to suppress statements the
defendant made to people who allegedly approached him under the
direction of law enforcement officers; and
IV. Whether the evidence is sufficient to support the verdict beyond
a reasonable doubt that the defendant is guilty of first-degree
murder, that is:
A. Whether the evidence was sufficient to prove
the defendant was the perpetrator; and
B. Whether the evidence was sufficient to prove
premeditation and deliberation.
We reverse and remand for a new trial.
Charlotte Scott, a seventy-two-year-old Nashville resident, was reported
missing on Tuesday, October 18, 1994. Her family had found the door to her home
unlocked, with no sign of forced entry. Her coffee pot was prepared to make coffee, no
valuables were missing, and her automobile was parked in front of her home. No blood
was found at the victim’s residence.
The defendant, the victim’s thirty-eight-year-old boyfriend, became a
suspect. He first spoke with police on Wednesday, October 19, and the police detective
with whom he spoke noticed a scratch mark on his face. The defendant stated that the
last time he saw the victim was in September 1994. The police discovered that shortly
after the victim disappeared, someone attempted eight separate ATM transactions on the
victim’s account, and three of these transactions were aborted for exceeding the amount
2
of money in the account. The defendant admitted using the victim’s ATM card: “I used
[the victim’s] bank card on Sunday [October 16] to take money out at Nipper’s Corner
First Tennessee Anytime Teller, the day she could not be found.” The significance of this
statement was that up until this point, the authorities did not know exactly when the victim
had disappeared.
On November 6, 1994, the defendant told his brother, Danny Bryan, that
he was with the victim at the rock quarry near Sam Ridley Boulevard on the evening she
disappeared. He said that on the evening of Saturday, October 15, 1994, the victim
called him and asked him to come to her house. He said he did not go to her house
immediately because his daughter was staying at his house. In the early morning hours
of Sunday, October 16, 1994, he drove to her house. They then drove to the rock quarry.
At around 2:00 a.m., he left to get the victim something to eat, but when he returned,
several unidentified men were there and he could not locate the victim. He hid until the
unidentified men left, went to the area where the men were, and discovered the victim’s
lifeless body, which he buried in the rock quarry. After the defendant admitted this to
Danny, Danny reported the conversation to the local police. Sometime after that, the
defendant visited Danny at his house, and Danny observed the defendant vacuuming his
car.
On November 7, the police searched the defendant’s house. No traces of
blood or fingerprints of the victim were found in the defendant’s residence or car. Acting
on the information Danny gave them, the police also began searching the rock quarry for
the victim’s body. Within the next week, a Nashville television station interviewed the
defendant on videotape. In the interview, the defendant said he did not know where the
victim was and that they were distributing “missing person” fliers around town in the hope
of finding her.
The defendant’s son, Shannon, approached the authorities involved in the
3
investigation and volunteered to help them locate the victim’s body. He told them he
believed if he talked to the defendant, the defendant would tell him where the victim’s
body was located. On November 11, wired with a recording device and a transmitter and
monitored by the police, Shannon met with the defendant at his house. Shannon asked
the defendant if he knew where the victim’s body was, and the defendant replied no.
Shannon suggested that they try to find the victim’s body, but the defendant refused,
claiming that would create more problems for them. The defendant stated he had the
victim’s ATM card and had used it three times after she disappeared. He later stated he
believed the victim was not dead but instead, had run away.
On November 14 around 9:00 p.m., Shannon again met with the defendant
at his house. This conversation was also monitored by the police. Again, the defendant
maintained he did not know where the victim’s body was, but he said if he did know, he
would help Shannon move it. Later, the defendant told Shannon that he knew where at
the rock quarry a man’s body was buried and that they should go move that body before
the police found it and accused him of murdering that person. They drove to the rock
quarry with a blanket and plastic to use to move the body when they found it. After
walking around that area for a while, they saw a police helicopter equipped with a search
light and hid.
By 3:00 a.m. on November 15, approximately six hours after Shannon had
arrived at the defendant’s house, the defendant and Shannon were still in the area of the
rock quarry. The defendant told Shannon to return to his car and he would go on to work.
The police monitoring the events found Shannon shortly thereafter. About one hour later,
the LaVergne Police Department picked up the defendant at his house, handcuffed him,
and returned him to the search site in the back seat of a patrol car. When they arrived,
the handcuffs were removed, but the defendant’s belongings were taken from him.
According to the defendant, he spent a considerable amount of the morning sitting in the
back of the patrol car and did not feel he was free to leave. At a pretrial hearing,
4
Detective E. J. Bernard testified he did not tell the defendant he was free to leave, but
neither did he tell him he must remain at the search site. However, at trial, Detective
Bernard testified that he did tell the defendant he was free to leave.
While at the search site that morning, the defendant gave a statement to
Detective Bernard. He told him that the victim had visited him at his house and had
asked him to go with her to the rock quarry to “make out.” The defendant said he could
not go with her because he was caring for his daughter, who was sleeping in the next
room. The defendant left the room to check on his daughter, and when he returned, the
victim was gone. He drove to the rock quarry to look for the victim. When he arrived, he
saw “various individuals” there and hid until they left. He then found the victim dead and
used a rake and a shovel to bury her. According to Detective Bernard, the defendant
walked around the search site with him and two other police officers in an attempt to lead
them to where he buried the victim’s body. Later, at the defendant’s request, a police
officer called an attorney, Mr. Brad Hornsby, on the telephone and allowed the defendant
to talk to him. Mr. Hornsby arrived at the search site, and he and the defendant left the
site together. The police had no further contact with the defendant until his arrest.
Within the next couple of days, the defendant’s stepnephew, Michael
Thompson, visited the defendant at his house. Michael had previously volunteered to
help the police by talking to the defendant in order to elicit information about the victim’s
disappearance. Because the defendant believed his house was bugged, he wrote to
Michael on pages from a notepad instead of talking to him. The defendant told Michael
he had left a rake and a shovel with his fingerprints on them in the rock quarry. Michael
said he would retrieve and dispose of these items for the defendant, so the defendant
drew him a map to a pit in the rock quarry where the tools would supposedly be found.
After drawing the map and writing other directions in the notepad, the defendant burned
the notepad’s used pages.
5
Michael reported this conversation to the police. Following the directions
the defendant gave him, Michael led the police to a pit in the rock quarry, in which the
victim’s body was found buried under layers of debris. An arrest warrant for the first-
degree murder of Charlotte Scott was issued for the defendant on November 18, 1994.
According to the autopsy report, the victim sustained four blows to the head by a firm,
hard object. The victim’s chest was compressed and her ribs were fractured forty-four
times, injuries which caused the victim’s death. The victim’s body was then stabbed with
a knife nine times and her breasts were amputated. The victim’s body exhibited no
defensive wounds or any sign of struggle. The weapons that caused the victim’s death
were not recovered.
The defendant was indicted for first-degree murder in January 1995. At trial
in June 1995, the jury found the defendant guilty as charged. The trial judge, sitting as
thirteenth juror, granted the defendant’s motion for a new trial. The defendant’s second
trial was held in April 1996. Again, the jury found the defendant guilty of first-degree
murder. Following a hearing, a life sentence was imposed on the defendant.
I.
The defendant first argues that his retrial violated the Double Jeopardy
Clause. Following a guilty verdict in his first trial in June 1995, the defendant filed a
Motion for Judgment of Acquittal and a New Trial. In this motion, the defendant argued
that because the evidence was legally insufficient, in that it did not prove premeditation,
deliberation, venue, or that the defendant was the perpetrator, he was entitled to a
judgment of acquittal. In the alternative, the defendant argued that he was entitled to a
new trial under Tennessee Rule of Criminal Procedure 33 because of the numerous
prejudicial errors that occurred throughout the trial and because the weight of the
evidence showed he was not guilty of first-degree murder. The trial judge notified the
parties via letter of his ruling on this motion. In his letter, the trial judge stated, in
pertinent part:
6
I find myself in the position that I disagree with the jury on the
weight of the evidence presented on the elements of premeditation
and deliberation. I, therefore, find it necessary to grant the
defendant’s request for a new trial. I specifically overrule the request
for a judgment of acquittal.
Having made the determination to grant the motion for new
trial as the 13th juror I would find it appropriate to have this case
transferred to another court for the retrial of this matter in accordance
with Rule 33 on the request of either party.
I will draw an order reflecting the court’s finding and notify
each party of its execution.
The subsequent order stated:
This court having considered a Motion for a Judgment of
Acquittal and/or Motion for New Trial, finds it necessary to grant the
defendant’s request for a Motion for New Trial under the provisions
of Rule 33(f) of the Tennessee Rules of Criminal Procedure. As a
13th juror this court disagrees with the jury about the weight of the
evidence on the issues of premeditation and deliberation and,
therefore, grants the defendant’s request for a new trial and the
transfer of this case to another trial court for the trial of the matter on
the request of either party.
The defendant filed a Motion for Specific Findings, in which he asked the
trial court to make specific findings that there was no evidence submitted as to venue,
premeditation, or deliberation. The defendant also requested the trial court “to reconsider
his previous Motion for Judgment of Acquittal and dismiss the case against him.” Further,
the defendant moved for permission to appeal to this Court, arguing that because the
State failed to prove venue, that the defendant committed the crime, or that the defendant
had the requisite intent, the Double Jeopardy Clause would bar his retrial.
The record fails to reveal an order addressing the defendant’s Motion for
Specific Findings. The trial court did address the defendant’s Motion for an Appeal by
Permission, however, stating, “As to the Motion for an Appeal by Permission, after
reviewing said motion the Court finds at the time this Court granted defendant’s motion
for a new trial it was granted on all issues and therefore denied defendant’s request for
7
appeal.” The trial court also stated, “Further, upon request of the State, under 33 (f) of
the Tennessee Rules of Criminal Procedure this case is transferred to the Presiding
Judge, the Honorable Don Ash for assignment to another Court for retrial.”
The defendant sought extraordinary appeal in this Court, claiming that
double jeopardy protections barred a new trial. This Court denied the defendant’s
request. The case proceeded to the new trial, after which the jury returned a verdict of
guilt. The defendant now argues that because the trial court granted his new trial motion
“on all issues,” double jeopardy protections barred retrial of this case.
Double jeopardy protections are implicated when the evidence is found to
be legally insufficient to support a defendant’s conviction. Tibbs v. Florida, 457 U.S. 31,
41 (1982). Legal insufficiency “means that the government’s case was so lacking that it
should not have even been submitted to the jury.” Id. (quoting Burks v. United States,
437 U.S. 1 (1978)). To contrast, double jeopardy protections are not implicated when a
court, sitting as a thirteenth juror, decides that a guilty verdict is against the weight of the
evidence because it disagrees with the jury’s resolution of conflicting evidence. Id. at 42.
In his Motion for Judgment of Acquittal and a New Trial, the defendant
argued he was entitled to a judgment of acquittal because the evidence was legally
insufficient. In the alternative, the defendant requested a new trial because the weight
of the evidence was contrary to the verdict. The trial court, sitting as thirteenth juror
pursuant to Tennessee Rule of Criminal Procedure 33(f), agreed that the weight of the
evidence was contrary to the verdict and thus granted the defendant a new trial.
However, the trial court explicitly denied the defendant’s motion for judgment of acquittal,
thus rejecting the defendant’s argument that the evidence in this case was legally
insufficient. As such, double jeopardy concerns were not implicated by the trial court’s
order. Nothing changed when the trial court later stated that it granted the defendant’s
8
motion for a new trial “on all issues” because the defendant’s basis for arguing
entitlement to a new trial was that the weight of the evidence was contrary to the verdict,
which does not implicate double jeopardy concerns. Our careful review of the record
reveals nothing even suggestive of the notion that the trial court ever determined that the
convicting evidence was legally insufficient. Thus, contrary to the defendant’s
contentions, the second trial in this case, which is what the defendant himself requested,
did not violate the Double Jeopardy Clause. This issue is without merit.
II.
The defendant next argues that the trial court erred in failing to suppress
the statement he made to Detective Bernard on November 15, 1994, at the search site.
He contends that at the time he gave the statement, he was in custody and had not been
read his Miranda rights. The defendant also contends that the statement should be
suppressed because the police officers knew he was represented by counsel at the time
he gave the statement.
The Fifth Amendment provides the right to counsel at any police-initiated
custodial interrogation. E.g., Edwards v. Arizona, 451 U.S. 477 (1981); State v.
Huddleston, 924 S.W.2d 666 (Tenn. 1996); State v. Bates, 804 S.W.2d 868 (Tenn.
1991). Miranda v. Arizona bars the admission of any statements elicited from the
defendant through custodial interrogation unless the defendant, prior to making the
statement, was warned of certain rights and knowingly waived those rights. 384 U.S. 436
(1966). “Custodial interrogation” is defined as “questioning initiated by law enforcement
officers after a person has been taken into custody or otherwise deprived of his freedom
of action in any significant way.” Id. at 444. In other words, Miranda warnings are
required when a suspect has been formally arrested or when his or her freedom of
movement has been restrained to the degree associated with a formal arrest. California
v. Beheler, 463 U.S. 1121 (1983); State v. Cooper, 912 S.W.2d 756 (Tenn. Crim. App.
9
1995).
In assessing whether an individual is “in custody,” the totality of the
circumstances must be examined to determine whether a reasonable person would
consider his or her freedom of movement restrained to the degree associated with formal
arrest. State v. Anderson, 937 S.W.2d 851 (Tenn. 1996). Factors relevant to this
determination include the following:
the time and location of the interrogation; the duration and character of the
questioning; the officer’s tone of voice and general demeanor; the suspect’s
method of transportation to the place of questioning; the number of police
officers present; any limitation on movement or other form of restraint
imposed on the suspect during the interrogation; any interactions between
the officer and the suspect, including the words spoken by the officer to the
suspect, and the suspect’s verbal or nonverbal responses; the extent to
which the suspect is confronted with the law enforcement officer’s
suspicions of guilt or evidence of guilt; and finally, the extent to which the
suspect is made aware that he or she is free to refrain from answering
questions or to end the interview at will.
Id. at 855.
Here, the trial court found that the police were not aware the defendant had
retained Mr. Hornsby until after he had been transported to the rock quarry, made his
statements to Detective Bernard, and called Mr. Hornsby to pick him up. While the
record supports this finding, it is immaterial to the disposition of this issue under a Fifth
Amendment analysis. Rather, the dispositive issue is whether the defendant was subject
to a police-initiated custodial interrogation and had knowingly waived his Fifth
Amendment rights at the time he made his statements to Detective Bernard.
Under the circumstances of this case, we must conclude that the
defendant’s Fifth Amendment rights were violated. At 4:00 a.m., the defendant was
handcuffed, placed in the back of a patrol car, and driven to the rock quarry. His personal
belongings were taken from him as he was escorted by police officers around the search
site and questioned. Given these circumstances, a reasonable person would not feel free
10
to leave.1 The defendant’s freedom of movement had been restrained to the degree
associated with formal arrest, which triggered the need for Miranda warnings under the
Fifth Amendment. See, e.g., Beheler, 463 U.S. at 1121. Unfortunately, however, the
defendant had not been informed of his Miranda rights. That being so, the defendant’s
statement to Detective Bernard was obtained in violation of his Fifth Amendment rights,
and it should have been suppressed. Moreover, we believe that the evidence does not
justify a conclusion that the error was harmless beyond a reasonable doubt.
III.
The defendant also argues that the trial court erred in failing to suppress
statements he made to his son, Shannon, and to his stepnephew, Michael. As support
for his argument, he claims Shannon and Michael were acting as agents of the police at
the time he talked with them.
The Sixth Amendment right to counsel attaches only after the adversarial
judicial process has begun. Huddleston, 924 S.W.2d at 669 (citing Michigan v. Jackson,
475 U.S. 436 (1986); State v. Mitchell, 593 S.W.2d 280 (Tenn. 1980)). “In Tennessee,
the adversarial judicial process is initiated at the time of the filing of the formal charge,
such as an arrest warrant, indictment, presentment, or preliminary hearing in cases where
a warrant was not obtained prior to the arrest.” Id. Here, the defendant’s conversations
with his son, Shannon, occurred on November 11 and November 14, and his
1
We recognize that Detective Bernard testified at the suppression hearing that he did not tell the
defendant he was free to leave, but then testified at trial that he did in fact tell the defendant he was free
to leave. We also reco gnize that the recent Tennessee S upreme C ourt case of State v. Johnny M.
Henning, No. 02S01-9707-CC-00065, Madison County (Tenn. filed June 22, 1998, at Jackson)(pending
publication), allows us to consider evidence adduced at trial in determining whether to suppress
evidence. However, given the conflict in Detective Bernard’s testimony, and given the totality of the
circumstances, we would still conclude that a reasonable person in the defendant’s place would not
have felt free to leave.
11
conversation with his stepnephew, Michael, occurred some time between November 15
and November 17. An arrest warrant was issued for the defendant on November 18,
after the defendant’s conversations with Shannon and Michael. Thus, the defendant’s
Sixth Amendment right to counsel had not attached at the time of his statements.
The defendant concedes that the Sixth Amendment right to counsel does
not attach until formal charges are filed, but he urges this Court to apply the Sixth
Amendment to circumstances in which the defendant becomes the focus of a police
investigation.2 Given the clear line of authority, including United States Supreme Court
authority, we decline to do so. See, e.g., Payne v. Johnson, 2 Tenn. Cas. (Shannon)
542, 543 (1877)(intermediate appellate courts have no authority to disregard higher
courts’ precedent).
IV.
Finally, the defendant challenges the sufficiency of the convicting evidence.
The defendant contends that the evidence failed to establish that he was the perpetrator
and that the victim was killed after premeditation and deliberation.
A guilty verdict rendered by the jury and approved by the trial judge
accredits the testimony of the State’s witnesses, and a presumption of guilt replaces the
presumption of innocence. State v. Grace, 493 S.W.2d 474, 476 (Tenn. 1973). Thus,
when an accused challenges the sufficiency of the convicting evidence, we must review
the evidence in the light most favorable to the prosecution in determining whether “any
rational trier of fact could have found the essential elements of the crime beyond a
reasonable doubt.” Jackson v. Virginia, 443 U.S. 307, 319 (1979). W e do not reweigh
2
W hat th e def end ant u rges is a ru le sim ilar to th at on ce ap plied in the c onte xt of th e Fifth
Amendment right against self-incrimination, i.e., that once the investigatory process shifts from the
investigation stage to th e accu satory stag e, the defe ndant’s rig hts are trigg ered. See Escobedo v.
Illinois , 378 U.S . 478 (19 64). Th at rule has since be en com pletely abolishe d. See, e.g., Stansbury v.
Calif ornia , 511 U.S . 318 (19 94); see also Anderson, 937 S.W .2d at 854 ; Cooper, 912 S.W.2d at 766.
12
or re-evaluate the evidence and are required to afford the State the strongest legitimate
view of the proof contained in the record as well as all reasonable and legitimate infer-
ences which may be drawn therefrom. State v. Cabbage, 571 S.W.2d 832, 835 (Tenn.
1978).
A.
The defendant admitted to using the victim’s ATM card shortly after the
victim disappeared. The evidence showed that someone attempted eight separate ATM
transactions, three of which were aborted for insufficient funds, on the victim’s account.
The evidence also revealed that the defendant knew that the victim “disappeared” on
October 16, even though the victim’s family, who discovered her missing, did not report
her missing until October 18. Just days after the victim’s disappearance, the defendant
had a red scratch across his neck.
Moreover, the defendant told inconsistent stories to various people at
different times. On October 19, in his initial interview with the police, the defendant stated
the last time he saw the victim was in September 1994. On November 6, he confided in
his brother, Danny, that he and the victim were at the rock quarry in the early morning of
October 16 and that he buried the victim there. In a videotaped interview with a television
station some time between November 7 and November 14, the defendant denied
knowing anything about the victim’s disappearance. On November 11, the defendant told
his son, Shannon, that he did not believe the victim was dead but that she had merely
“run away.” When he talked with Shannon again on November 14, the defendant denied
knowing anything about where the victim’s body might be located, but he said he knew
where someone else’s body was buried in the rock quarry. Yet just hours later, the
defendant told Detective Bernard a story similar to what he told his brother, Danny, i.e.,
13
that he had buried the victim at the rock quarry. 3
Further, the defendant accompanied Shannon to the rock quarry to search
for a body and further conceal it from the authorities with plastic and a blanket. He also
asked his stepnephew, Michael, to dispose of a rake and a shovel that he left at the rock
quarry and that supposedly had his fingerprints on them. Following the directions the
defendant gave him, his stepnephew led the authorities to a pit in the rock quarry, in
which the victim’s body was found. Considering the totality of this evidence in the light
most favorable to the State, a rational jury could have concluded, on the evidence
presented to it, that the defendant was responsible for the victim’s death.
B.
The defendant also challenges the sufficiency of the evidence as to the
elements of premeditation and deliberation. Premeditation requires proof that the
defendant had a previously formed design or intent to kill. T.C.A. § 39-13-210(b)(2)
(1991); State v. Brown, 836 S.W.2d 530 (Tenn. 1992); State v. West, 844 S.W.2d 144
(Tenn. 1992). Deliberation requires a showing that the defendant had some time to
reflect and that his mind was free of impulse and passion prior to the killing. T.C.A.
§ 39-13-210(b)(1); Brown, 836 S.W.2d at 540. The elements of premeditation and
deliberation are questions for the jury that may be established by proof of the
circumstances surrounding the killing. Id. at 539. Several factors tend to support the
existence of these elements, including the use of a deadly weapon upon an unarmed
victim; the particular cruelty of the killing; declarations by the defendant of an intent to kill;
evidence of procurement of a weapon; preparations before the killing for concealment of
3
It is inappropriate to assess the sufficiency of the evidence based only on the properly admitted
evidenc e. See, e.g., State v. Longstreet, 619 S.W .2d 97 (T enn. 198 1); State v. Robert Lee “Flippo”
Mor ris, C.C.A. N o. 1195, H amilton Coun ty (Tenn. C rim. Ap p. filed Nov emb er 20, 19 91, at Kno xville).
Thus, even though we hold that the statement given to Detective Bernard was improperly admitted, we
mus t conside r it in determ ining whe ther the ev idence p resente d to the jury is s ufficient to s ustain a g uilty
verdict.
14
the crime; and calmness immediately after the killing. State v. Bland, 958 S.W.2d 651,
660 (Tenn. 1997).
Here, the victim was a seventy-two-year-old woman. The defendant
admitted being with the victim just prior to her death. The defendant also admitted
burying the victim under debris in a pit at the rock quarry. No blood was found in the
defendant’s residence, the defendant’s car, or the victim’s residence, suggesting that the
victim was killed at the rock quarry. The rock quarry is a relatively remote location, a fact
which could support findings of premeditation and deliberation. See, e.g., State v.
Williams, 784 S.W.2d 660 (Tenn. Crim. App. 1989).
The victim sustained four blows to the head by a firm, hard object.
According to the medical examiner, these injuries would not, by themselves, cause death,
but they would be sufficient to stun an individual or cause unconsciousness. The victim’s
chest was compressed and her ribs were fractured forty-four times, injuries consistent
with being run over by a motor vehicle. The nature of the victim’s death, that she was
likely stunned or knocked unconscious and then run over by a car, indicate that the
perpetrator had ample time to reflect on his actions and that he intended his actions to
kill the victim. The assault on the victim did not end there, however. Post-mortem, the
victim’s body was stabbed with a knife nine times and her breasts were amputated. The
victim’s body exhibited no defensive wounds or any sign of struggle, indicating, in the
medical examiner’s opinion, that the victim was unable to defend herself or was taken by
surprise.
Construing this evidence in the light most favorable to the State, a rational
jury could have concluded, on the facts presented to it, that the defendant, without
passion or provocation and with a cool purpose, consciously engaged in the conduct
causing the victim’s death. See, e.g., State v. Bush, 942 S.W.2d 489, 502 (Tenn.
15
1997)(evidence that defendant hit victim with a board and then retrieved a second
weapon, a knife, to continue attack is probative of premeditation). Therefore, the
evidence in this record is sufficient to establish premeditation and deliberation.
CONCLUSION
In sum, retrial of the defendant did not violate the constitutional protections
against double jeopardy. Moreover, the State presented sufficient evidence to prove that
the defendant was the perpetrator and that he killed the victim with premeditation and
deliberation. Finally, while the trial court properly admitted into evidence the statements
the defendant made to his son and his stepnephew, the statement the defendant made
to Detective Bernard on November 15, 1994, violated the defendant’s Fifth Amendment
right against self-incrimination and should have been suppressed. Accordingly, we
remand for a new trial without introduction of the statement given to Detective Bernard.
_______________________________
JOHN H. PEAY, Judge
CONCUR:
______________________________
JOSEPH M. TIPTON, Judge
______________________________
DAVID G. HAYES, Judge
16
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199 F.2d 367
HENSON,v.WELCH.
No. 6461.
United States Court of Appeals Fourth Circuit.
Argued Oct. 6, 1952.Decided Oct. 8, 1952.
Clarence Henson, pro se, on the brief.
William P. Woolls, Jr., Sp. Asst. to the U.S. Atty., Alexandria, Va. (A. Carter Whitehead, U.S. Atty., Richmond, Va., on the brief), for appellee.
Before PARKER, Chief Judge, and SOPER and DOBIE, Circuit Judges.
PER CURIAM.
1
This is an appeal from an order denying a writ of habeas corpus to a prisoner held in the District of Columbia Reformatory at Lorton, Virginia. No question is raised in the petition for habeas corpus as to the validity of the judgment and sentence under which the prisoner is held, but he seeks the writ for the purpose of reviewing disciplinary action taken on account of alleged breach of prison discipline of which appellant denies that he was guilty. We agree with the District Judge that the writ of habeas corpus may not be used for this purpose. 'Since the prison system of the United States is entrusted to the Bureau of Prisons under the direction of the Attorney General, 18 U.S.C.A. § 4042, supra, the courts have no power to supervise the discipline * * * , but only on habeas corpus to deliver from prison those who are illegally detained.' Williams v. Steele, 8 Cir., 194 F.2d 32, 34, s.c. on rehearing 194 F.2d 917-918. See also Snow v. Roche, 9 Cir., 143 F.2d 718, 719. The petition for writ of habeas corpus was properly denied.
2
Affirmed.
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764 F.2d 1033
ACLI GOVERNMENT SECURITIES, INC., Appellee,v.Daniel RHOADES, Norma Rhoades, Appellants. (Three cases).
Nos. 84-1765(L), 84-2106 and 84-2135.
United States Court of Appeals,Fourth Circuit.
Argued April 2, 1985.Decided June 24, 1985.
Karl L. Kenyon, Anderson, S.C. (Kenyon & Lusk, Robert P. Lusk, Anderson, S.C., on brief), for appellants.
Clay D. Brittain, III, Columbia, S.C., (Nelson, Mullins, Grier & Scarborough, Columbia, S.C., on brief), for appellee.
Before WIDENER and WILKINSON, Circuit Judges, and BUTZNER, Senior Circuit Judge.
PER CURIAM:
1
Appellants Daniel Rhoades and his sister Norma Rhoades appeal from a judgment of the United States District Court for the District of South Carolina finding that Norma Rhoades had no interest in certain real property located in Anderson, South Carolina, title to which was held by Daniel Rhoades, and directing a sale of the property in partial satisfaction of a judgment against Daniel Rhoades in favor of appellee ACLI Government Securities, Inc. (AGS). Because we find that the district court was correct in all respects, we affirm.
2
* In an action brought in the United States District Court for the Southern District of New York, AGS recovered a judgment against Daniel Rhoades in the amount of $1,285,598.28. After determining that Daniel Rhoades was the owner of 420 acres of real property in Anderson, South Carolina, AGS registered the New York judgment in the District of South Carolina, pursuant to 28 U.S.C. Sec. 1963 (1982), and on August 19, 1983, the company filed a petition seeking sale of the property. Daniel Rhoades objected on the grounds that he held the property merely as a nominee for an unnamed principal. He also sought to attack the New York judgment collaterally for want of subject matter jurisdiction, alleging a lack of diversity of citizenship. The court found that the district court in New York had rejected Rhoades' jurisdictional argument in a post-judgment proceeding. At that time, both the judgment and the jurisdictional objection were on appeal to the Court of Appeals for the Second Circuit. The district court in South Carolina proceeded with hearings on the question of ownership and found that the only claimant, Norma Rhoades, could prove no interest in the property.
3
On May 2, 1984, the Court of Appeals for the Second Circuit issued its mandate affirming the judgment for AGS.* At a hearing on August 22, 1984, only days before the scheduled August 29 sale of the real property, appellants argued for the first time that the initial registration of the New York judgment in South Carolina was invalid because at that time the case was on appeal and hence the judgment was not then final. The South Carolina district court refused to vacate its order directing the sale and on October 3, 1984, it confirmed the sale pursuant to 28 U.S.C. Secs. 2001-2002 (1982).
II
4
The record clearly supports the trial court's findings that Norma Rhoades had no interest in the subject property. The court dealt in detail with each of appellants' arguments for a resulting trust, a constructive trust, and an express oral trust. It found no merit in any of the contentions, concluding that the parties did not meet the burden of "definite, clear, unequivocal, and convincing evidence" required for either a resulting or constructive trust, citing Glover v. Glover, 268 S.C. 433, 234 S.E.2d 488, 489 (1977), and that Daniel Rhoades' "entire testimony and that of his sister is incredible and totally unworthy of belief." This was particularly true, the court noted, in light of the fact that brother and sister had been practicing attorneys for a number of years and should have been well aware of the importance of maintaining accurate land records. There was no documentation in support of their position, and the court's findings were not erroneous in this matter.
5
We need not tarry over the matter of the registration of the judgment in South Carolina pending appeal in New York, as the question was mooted prior to the sale. Furthermore, appellants did not even raise the question until after the mandate had issued from the Second Circuit, so appellants' objection was untimely as well.
6
Appellants' jurisdictional objections were litigated in New York. The question may not be reopened by way of collateral attack after an adverse judgment elsewhere. Insurance Corp. of Ireland v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702 n. 9, 102 S.Ct. 2099, 2104, n. 9, 72 L.Ed.2d 492 (1982). We likewise find no fault with the trial court's confirmation of the sale pursuant to 28 U.S.C. Secs. 2001-2002. There is no basis for appellants' contentions that a state procedure should have been used.
7
The judgment of the district court is affirmed.
8
AFFIRMED.
*
The United States Supreme Court subsequently denied Daniel Rhoades' petition for certiorari. Rhoades v. ACLI Government Securities, Inc., --- U.S. ---, 105 S.Ct. 183, 83 L.Ed.2d 117 (1984)
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968 F.2d 1214
140 L.R.R.M. (BNA) 2744
NOTICE: Sixth Circuit Rule 24(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Sixth Circuit.BRICKLAYERS' LOCAL UNION # 14, INTERNATIONAL UNION OFBRICKLAYERS AND ALLIED CRAFTSMAN, AFL-CIO, avoluntary unincorporated labororganization, Plaintiff-Appellant,Bricklayers & Trowel Trades' International Pension Fund;Bricklayers Industry Advancement Fund;Bricklayers Joint ApprenticeshipTraining Committee, Plaintiffs,v.COLASANTI CORPORATION, a corporation incorporated under thelaws of the State of Michigan, Defendant-Appellee.
No. 91-1482.
United States Court of Appeals, Sixth Circuit.
June 23, 1992.
Before MARTIN and MILBURN, Circuit Judges, and PECK, Senior Circuit Judge.
PER CURIAM.
1
Bricklayers' Local Union # 14 appeals the district court's decision granting summary judgment to the Colasanti Corporation. For the following reasons, we affirm the judgment of the district court.
2
Colasanti is a Michigan-based structural concrete contractor. Local 14 is a union local that governs various construction trades including cement masons. Local 14's "geographical jurisdiction" is Washtenaw County, Michigan, and portions of Livingston County, Michigan. Local 14's union authority over cement masons does not, however, extend to the three-county area surrounding Detroit. Thus, in Wayne, Oakland, and Macomb Counties three other union locals govern cement masons: (1) Cement Masons, Local 514 in Detroit, (2) Cement Masons, Local 29 in Pontiac, Michigan, and (3) Cement Masons, Local 26 in Mt. Clemens, Michigan.
3
On August 6, 1987, the Washtenaw Contractors Association entered into a collective bargaining agreement with Local 14 effective from August 6, 1987, until July 31, 1990. Under the agreement, the Washtenaw Contractors Association recognized Local 14 as the sole collective bargaining agent for employees who (1) were represented by Local 14, and (2) worked on an association member's construction project if the project was located in Local 14's jurisdiction. The agreement contained numerous provisions including a provision setting forth the hourly compensation for cement masons. Although Colasanti was not a member of the Washtenaw Contractors Association, the company became bound by the Local 14 collective bargaining agreement by signing a "memorandum of agreement" for "non-association contractors." The memorandum stated that Colasanti agreed to be bound by all the terms of the Local 14 collective bargaining agreement. The agreement also stated:
4
[Colasanti], by its authorized agent who has executed this Agreement, hereby affirms that it has read the collective bargaining agreement attached hereto and that it is familiar with its terms, and [Colasanti] hereby adopts and accepts the attached agreement in its entirety as the basis upon which it will employ members of Local Union No. 14 MI.
5
(emphasis added)
6
This case gets more complicated because at all times relevant to this litigation Colasanti was a member of a Detroit contractors' association. In the 1980's, this association entered into a collective bargaining agreement with Local 514, Local 29, and Local 26. Because Colasanti was a member of the association, it became bound by the collective bargaining agreement between the contractors' association and the three Detroit-area unions. The agreement, which was effective from June 1, 1987, until June 1, 1989, governed working conditions for the locals' cement masons on any construction project located in Wayne, Oakland, or Macomb County. Thus, the agreement set forth the hourly compensation for cement masons.
7
In 1987, Colasanti began working on a construction project in Washtenaw County that required the use of cement masons. Washtenaw County, of course, was part of Local 14's cement masons' jurisdiction. A majority of the cement masons that Colasanti used on the project were members of Local 14, and Colasanti paid these cement masons according to the provisions of the collective bargaining agreement between Local 14 and the Washtenaw Contractors Association. Colasanti, however, also used several of the corporation's permanent cement masons who were members of Local 514, Local 29, or Local 26. Colasanti paid these cement masons according to the collective bargaining agreement between the Detroit contractors' association and the three Detroit-area unions.
8
In 1989, a Local 14 audit of Colasanti's records revealed that Colasanti had paid cement masons who were members of the Detroit-area unions according to the Detroit collective bargaining agreement even though the construction project was located within Local 14's jurisdiction. On June 19, 1989, four plaintiffs filed an action against Colasanti alleging that the company had breached Local 14's collective bargaining agreement because the corporation (1) did not pay wages to all cement masons according to Local 14's collective bargaining agreement; (2) did not pay union dues to Local 14 on behalf of all cement masons; and (3) did not pay fringe benefit contributions to all cement masons according to Local 14's collective bargaining agreement.
9
Subsequently, the plaintiffs and Colasanti filed cross-motions for summary judgment. The district court granted summary judgment to Colasanti after ruling there was nothing in Local 14's collective bargaining agreement that imposed a duty on Colasanti to pay members of the three Detroit-area unions in accordance with Local 14's agreement. All four of the plaintiffs appealed from the district court's decision. However, because of our decision in Bricklayers Local Union No. 14 v. Russell Plastering, 948 F.2d 229 (6th Cir.1991), which involved essentially the same collective bargaining agreement as this case, three of the four original plaintiffs in this action have decided to abandon their claims related to fringe benefits. The sole remaining appellant before this court is Local 14, and the sole remaining claim concerns wages and union dues.
10
Summary judgment is not a disfavored procedural shortcut; it is an integral part of the federal rules of civil procedure. Celotex Corp. v. Catrett, 477 U.S. 317, 327 (1986). It is appropriate only where "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show there is not a genuine issue as to any material fact and that the moving party is entitled to summary judgment as a matter of law." Canderm Pharmacal, Ltd. v. elder Pharmaceuticals, Inc., 862 F.2d 597, 601 (6th Cir.1988) (quoting Fed.R.Civ.P. 56(c)) (emphasis added). In reviewing a motion for summary judgment, this court views the evidence in a light most favorable to the non-moving party. Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59 (1970). Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue of material fact for trial. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).
11
As an initial matter, Local 14 asserts that in light of our decision in Russell Plastering, 948 F.2d at 229, we should reverse the district court's decision regarding Local 14's claim for wages and union dues. Local 14 asserts that "the Russell Plastering [c]ourt's interpretation of the contract language in question entitled [Russell] to summary judgment on the fringe benefits claims made in that case, but the [c]ourt's remand order recognized that the defendant in Russell Plastering was not entitled to judgment as a matter of law on the wage and [union] dues check-off issues."
12
We believe, however, that Local 14 has mischaracterized the rationale behind this court's remand order in Russell Plastering. In Russell Plastering, which is a case that is almost identical to the present case, the contractor had signed two collective bargaining agreements. One collective bargaining agreement was between the contractor and Local 14; the second agreement was between the contractor and Local 67, which was Detroit-area local union. Id. at 230. The Local 14 collective bargaining agreement in Russell Plastering contained the same relevant language as the agreement in this case. After signing the collective bargaining agreements, Russell began work on a construction project that was located in Local 14's geographical jurisdiction. On this project, Russell employed both Local 14 members and Local 67 members. Russell paid the Local 14 members according to the Local 14 collective bargaining agreement; however, Russell paid the Local 67 members according to the Local 67 collective bargaining agreement. Id. After Local 14 and three fringe benefit funds filed an action, the district court, inter alia, dismissed Local 14's wages claim after ruling that Local 14 had failed to exhaust the grievance and arbitration procedures contained in the collective bargaining agreement. Id. at 231. On appeal, this court concluded that the union could challenge the wages issue in district court without resort to the agreement's grievance and arbitration procedures; therefore, we held the district court had erred in dismissing Local 14's wage claim on procedural grounds--failure to exhaust grievance and arbitration procedures. Id. at 231-32 Local 14's assertions in this case notwithstanding, there is no language in Russell Plastering to suggest that we remanded Local 14's wage and union dues claims because we determined that Russell was not entitled to summary judgment based on the language of the collective bargaining agreement. We, therefore, reject Local 14's argument.
13
Although our decision in Russell Plastering does not support a remand of Local 14's wage and union dues claim, it does guide our interpretation of the collective bargaining agreement's language on wages and union dues. In Russell Plastering, we had to determine whether Russell had violated Local 14's collective bargaining agreement by paying fringe benefits to Local 67 members according to the Local 67 agreement even though the construction project was located in Local 14's jurisdiction. We noted that because Russell was not a member of the Washtenaw Contractors Association, the "memorandum of agreement" for "non-association contractors" contained the controlling language. We held that under the language of the memorandum of agreement, Russell had accepted and adopted the underlying agreement only as the basis on which it would employ members of Local 14. Id. at 231-32. Thus, to the extent that Russell had hired members of Local 14, Russell was required to comply with the terms of the Local 14 agreement. However, to the extent that Russell employed members of Local 67, Russell could pay them according to the Local 67 agreement without violating the Local 14 agreement. Id. at 232.
14
In this case, we find no good reason to interpret the wages and union dues provision in the Local 14 agreement any differently than Russell Plastering 's interpretation of the agreement with respect to fringe benefits. Hence, we hold that Colasanti did not breach Local 14's agreement by paying members of the three Detroit-area unions according to the company's collective bargaining agreement with these three entities.
15
For the foregoing reasons, we affirm the judgment of the district court.
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499 F.2d 135
UNITED STATES of America, Plaintiff-Appellee,v.Robert F. DEVITT, Defendant-Appellant.
No. 73-1691.
United States Court of Appeals, Seventh Circuit.
Argued Dec. 6, 1973.Decided July 2, 1974.
1
Julius Lucius Echeles, Chicago, Ill., for defendant-appellant.
2
James R. Thompson, U.S.Atty., Dan K. Webb, Asst. U.S.Atty., Chicago, Ill., for plaintiff-appellee.
3
Before HASTINGS and KILEY, Senior Circuit Judges, and CAMPBELL, Senior District Judge.1
4
WILLIAM J. CAMPBELL, Senior District Judge.
5
Defendant Robert F. Devitt, a Chicago police officer, was indicted in a one count indictment for having made false statements before a grand jury in violation of 18 U.S.C. 1623. Upon the jury's verdict of guilty, defendant was sentenced to three years' imprisonment.
The indictment charged that the defendant:
6
'did knowingly declare in substance before said Grand Jury with respect to the aforesaid material matters that he did not recall, remember, or have any knowledge, while in the performance of his duties as a Chicago police officer of ever accepting money from any person; that he did not recall, remember, or have any knowledge while in the performance of his duties as a Chicago police officer, of ever having accepted any money from any owner, operator, employee or agent of any tavern or business.'
18 U.S.C. 1623 provides, in pertinent part:
7
'(a) Whoever under oath in any proceeding before (a) . . . grand jury . . . knowingly makes any false material declaration . . ., shall be fined not more than $10,000.00 or imprisoned not more than five years, or both. (e) Proof beyond a reasonable doubt under this section is sufficient for conviction. It shall not be necessary that such proof be made by any particular number of witnesses or by documentary or other type of evidence.
8
At trial, the government presented testimony of four witnesses, each of whom operated a tavern in Chicago, Illinois, and each of whom testified to having paid money to defendant while Devitt was in the performance of his duties as a Chicago police officer. Defendant testified in his own behalf and denied receiving any such payments.
9
Defendant's first contention on appeal is that the indictment did not sufficiently allege, and the evidence was insufficient to prove, that, at the time he appeared before the grand jury, defendant was under oath administered by one authorized by law to administer oaths. The indictment in the instant case charged that defendant knowingly made a false material declaration 'while under oath as a witness before the Special February 1971 Grand Jury of the United States of America, duly empaneled and sworn in the United States District Court for the Northern District of Illinois . . .'. The indictment clearly alleged that defendant was under oath at the time he made the alleged false material declarations. The fact that the indictment does not allege that the oath was 'administered by one authorized by law to administer oaths' is of no consequence. 18 U.S.C. 1623 contains no such requirement.
10
Regarding the sufficiency of the evidence, the Justice Department attorney present during the grand jury proceedings testified at trial that Devitt was administered the oath by the foreman of the grand jury on February 23, 1972. The transcript of Devitt's testimony was subsequently introduced into evidence. We find no merit to defendant's contention that this evidence was insufficient to prove that he testified under oath.
INSTRUCTIONS
11
We also reject defendant's assertion that the trial court invaded the province of the jury in failing to instruct the jury that the defendant must be found to have been under oath administered by one competent to administer oaths. As previously noted, 18 U.S.C. 1623 requires neither that the indictment allege nor that the government prove that the accused took an oath 'administered by one authorized by law to administer oaths'. Moreover, defendant neither objected to the instructions relating to the administration of the oath nor tendered to the district court proposed instructions reflecting the position now advanced on appeal.
12
Defendant also argues that Instruction 29 was erroneous because it did not require that Devitt be found to have accepted money from any one or more of the tavern owners named in the indictment 'in the performance of his duties as a Chicago police officer', as alleged in the indictment. The instructions, in their entirety, repeatedly advised the jury that defendant must be found to have accepted money 'in the performance of his duties as a Chicago police officer', and viewed in their entirety, we find the instructions to the jury more than adequate. United States v. Esquer, 459 F.2d 431, 435 (7th Cir. 1972).
MATERIALITY
13
To sustain a conviction under 18 U.S.C. 1623, the defendant's false declarations must be 'material'. Conceding that the issue of materiality under 18 U.S.C. 1623 is a question of law to be determined by the court, United States v. Wesson, 478 F.2d 1180, 1181 (7th Cir. 1973); United States v. Rivera, 448 F.2d 757 (7th Cir. 1971); United States v. Parker, 447 F.2d 826, 830 (7th Cir. 1971), defendant contends that his allegedly false declarations were not material, as a matter of law, for two reasons:
14
(1) The grand jury's inquiry pertained to 'purely local conduct', and was therefore not a proper subject for investigation under the Hobbs Act, 18 U.S.C. 1951.
15
(2) The grand jury's examination of the defendant 'was not pursuant to any legitimate grand jury function' because the grand jury had already amassed information from independent sources sufficient to seek an indictment against defendant without summoning him.
16
Contending that the grand jury's investigation 'involved nothing more than alleged 'pay-offs' by tavern owners to policemen' and that the 'Hobbs Act, 18 U.S.C. Sec. 1951 cannot properly be applied to such purely local activities', defendant argues that the questions asked of him during that investigation were not 'material'. The underlying proposition advanced by defendant-- that the conduct under investigation was not properly subject to federal criminal jurisdiction-- has previously been rejected by this court in United States v. DeMet, 486 F.2d 816 (7th Cir. 1973). There, confronted with the same arguments now advanced by Devitt, the court held that 'Section 1951 clearly contemplates a full bapplication of the commerce power. It proscribes extortion which 'in any way or degree obstructs, delays, or affects commerce or the movement of any article or commodity in commerce . . .'.' 486 F.2d at 821.
17
The DeMet court found that commerce had been affected by the same kind of extortionate activities which were under investigation by the grand jury in the instant case. Moreover, the victims of extortion in DeMet were, as here, retail liquor establishments. Judge Fairchild, speaking for the court, rejected the argument that commerce had not been affected, holding that:
18
'Where the victim of extortion, as here, customarily obtains inventory which has come from outside the state, obstruction and delay of, and effect upon commerce may, for the purpose of the Hobbs Act, be found in curtailment of the victim's potential as a buyer of such goods. This may be traced either through the depletion of his assets by his fulfillment of the extortionate demands or the harm which would follow if the threats were carried out.' 486 F.2d at 822.
19
Since the grand jury's investigation concerned conduct which might properly be made the subject of federal criminal prosecution, degendant's false testimony concerning such activities was not immaterial.
20
Defendant's second contention respecting materiality is that the allegedly false testimony did not influence, impede or dissuade the grand jury in connection with its investigation. Defendant argues that the questions directed to him did not concern 'official corruption' generally, but rather were limited solely to his conduct while in the performance of his duties as a Chicago police officer. Since the grand jury had previously heard testimony from the four tavern owners who ultimately testified against defendant during his trial, defendant maintains that no further 'fruitful investigation' would have resulted from truthful responses to the questions asked of him by the grand jury.
21
False testimony before the grand jury is material if it 'has the natural effect or tendency to impede, influence or dissuade the grand jury from pursuing its investigation. United States v. Stone, 429 F.2d 138, 140 (2nd Cir., 1970), and cases cited therein. Moreover, if the false statement 'potentially interferes with the grand jury's line of inquiry, materiality is thereby established even though the perjured testimony does not actually impede the investigations.' United States v. Wesson, 478 F.2d 1180, 1181 (7th Cir., 1973). See also, Vitello v. United States, 425 F.2d 416, 424 (9th Cir. 1970); United States v. Henderson, 185 F.2d 189, 191 (7th Cir. 1950).
22
In the instant case, the grand jury was engaged in an investigation of possible extortionate conduct by certain Chicago Police Department personnel in violation of the Hobbs Act. Defendant's false declarations potentially interfered with and impeded that investigation insofar as defendant's false answers rendered further inquiry on the subject a meaningless exercise. Had defendant answered honestly, the grand jury would have been advised that he had, in fact, accepted money from tavern owners while in the performance of his duties as a Chicago police officer. The grand jury would then have been in a position to determine the identity of other extortion victims, if any, who had not previously been identified. Potentially, honest responses to the questions asked of defendant might have led to a determination of the identity of other police officers, if any, engaged in similar practices.
23
In short, the fact that the questions which defendant failed to answer truthfully related only to his conduct as a Chicago police officer is not dispositive. Truthful answers to those questions might well have served as the foundation for a more 'fruitful investigation' into the broader subject matter of the grand jury's inquiry. Accordingly, we find that the district judge correctly determined the materiality of Devitt's allegedly false statements.
EQUAL PROTECTION
24
Defendant next claims that he was denied equal protection of the law because he was indicted and convicted under 18 U.S.C. 1623 (proscribing false material declarations before a grand jury or a court) rather than 18 U.S.C. 1621 (perjury). Defendant argues that 1621 has been construed to require that the falsity of each allegedly perjurious statement be proven either by the testimony of two witnesses or by the testimony of a witness, corroborated by other evidence. United States v. Rivera, 448 F.2d 757 (7th Cir. 1971).
25
1623 specifically provides that the 'two-witness rule' is not applicable to prosecutions thereunder:
26
'It shall not be necessary that such proof be made by any particular number of witnesses or by documentary or other type of evidence.' 18 U.S.C. 1623(e).
27
Defendant cites no case in support of the novel proposition that where conduct is proscribed by two or more separate criminal statutes, the government must elect to prosecute under the statute imposing the greatest burden of proof. As did the court in United States v. Ruggiero, 472 F.2d 599, 606 (2d Cir. 1973), we find defendant's contention in this regard entirely without merit. If anything, the government would be expected to proceed under 1623 rather than 1621, on the ground that a statute aimed at specific conduct prevails over an otherwise applicable general statute. See, United States v. Kahn, 472 F.2d 272 (2d Cir. 1973).
BAD FAITH
28
Defendant argues that he was questioned by the grand jury regarding matters as to which the statute of limitations pertaining to substantive criminal prosecution had expired. Conceding that the grand jury may seek information which predates the applicable limitation period, United States v. Cohn, 452 F.2d 881, 883 (2d Cir., 1971), defendant nonetheless contends that, in the instant case, inquiry along these lines constituted bad faith conduct by the grand jury, since the information sought had already been obtained from sources other than the defendant. Defendant concludes that the sole purpose of calling him before the grand jury was 'to try to get him to perjure himself' and that since the grand jury was not attempting to seek useful information in connection with its investigation, 'it was not functioning as a competent entity.'
29
We need not reiterate what has been said regarding the materiality of defendant's testimony. Suffice it to say that because truthful answers potentially could have led to a more fruitful investigation, the grand jury's inquiry cannot be viewed merely as a device to 'get him to perjure himself'. As the court stated in United States v. Cohn, supra, the scope of the grand jury's inquiry 'is not limited to events which themselves may result in criminal prosecution, but is properly concerned with any evidence which may afford valuable leads for investigation of suspected criminal activity during the limitations period.' 452 F.2d 881, 883. See also, United States v. Wesson, 478 F.2d 1180, 1181 (7th Cir. 1973).
30
The record in the instant case does not support defendant's assertion that the grand jury was not attempting to obtain useful information in furtherance of its investigation. Consequently, we find no basis for the speculative conclusion that the grand jury was acting in bad faith.
SUFFICIENCY OF THE EVIDENCE
31
Devitt's allegedly false statements consisted of declarations that he had no knowledge of, or could not recall, any instance in which he had accepted money from any tavern owner while in the performance of his official duties as a Chicago police officer. Defendant argues that the evidence was insufficient to prove beyond a reasonable doubt that at the time he testified, he knew his answers to be false. Defendant relies heavily upon the fact that the incidents regarding which the government's witnesses testified pre-dated his testimony by as much as eight years, and intimates that defendant might have confused these incidents with those in which he accepted gifts legitimately from local businessmen for 'meritorious service'.
32
Whether defendant knew at the time he testified that his statements were false may be proven by circumstantial evidence, United States v. Nicoletti, 310 F.2d 359 (7th Cir. 1962), and 'generally, a belief as to the falsity of testimony may be inferred by the jury from proof of the falsity itself.' Young v. United States, 94 U.S.App.D.C. 54, 212 F.2d 236, 241 (1941). Although the testimony of the tavern owners did not directly establish that defendant actually remembered receiving money from them, their testimony did establish that the money was paid to the defendant while in the performance of his duties as a Chicago police officer. These witnesses testified in detail regarding veiled threats made by defendant to the effect that he would use his official position to their economic detriment unless he was paid a certain sum of money. Each witness testified that money was subsequently paid to the defendant. Defendant testified in his own behalf and denied accepting the money from any of the four tavern owners. On cross examination, he testified that if he had ever 'shaken down any taverns', he would remember it. The jury apparently concluded that, contrary to his testimony at trial, defendant had accepted money from the four tavern owners and that he remembered doing so. We find the circumstantial evidence here substantially greater than that presented in United States v. Clizer, 464 F.2d 121 at 125 (9th Cir. 1971), and viewed in the light most favorable to the appellee, sufficient to prove beyond a reasonable doubt that at the time defendant testified before the grand jury he knew his testimony to be false.
CHICAGO POLICE DEPARTMENT RULE 51
33
Approximately one week before oral argument in the instant appeal, this court decided Confederation of Police, et al. v. Conlisk, et al., 489 F.2d 891 (7th Cir. 1973), holding Chicago Police Department Rule 51 unconstitutional. Rule 51 prohibited Chicago police officers from:
34
'Failing to give evidence before the Grand Jury . . . when properly called upon to do so, or refusing to testify on the grounds that such testimony might incriminate the member, or refusing to sign a waiver of immunity when requested to do so by a superior officer.'
35
Each of the plaintiffs in Confederation of Police was a police officer who had invoked the privilege against self-incrimination and refused to testify before a federal grand jury. Plaintiffs were thereafter either suspended or discharged for violating Rule 51.
36
After tracing the development of the law from the Supreme Court's decision in Garrity v. New Jersey, 385 U.S. 493, 87 S.Ct. 616, 17 L.Ed.2d 562 (1967), to its decisions in Gardner v. Broderick, 392 U.S. 273, 88 S.Ct. 1913, 20 L.Ed.2d 1082 (1968) and Uniformed Sanitation Men Ass'n, Inc. v. Commissioner of Sanitation, 392 U.S. 280, 88 S.Ct. 1917, 20 L.Ed.2d 1089 (1968), this court held that 'Rule 51, to the extent that it denies police officers the privilege against self-incrimination where criminal prosecution may follow, is constitutionally invalid.' 489 F.2d at 895.
37
Where a public employee testifies before a grand jury under the threat that his refusal to testify will result in disciplinary proceedings against him, the use of evidence so obtained against that witness in a subsequent criminal prosecution is improper. 'the protection of the individual under the Fourteenth Amendment against coerced statements prohibits use in subsequent criminal proceedings of statements obtained under threat of removal from office.' Garrity v. New Jersey, 385 U.S. at 500, 87 S.Ct. at 620.
38
Nor may disciplinary action be taken against the witness for his refusal to testify, unless he is first advised that, consistent with the holding in Garrity, evidence obtained as a result of his testimony will not be used against him in subsequent criminal proceedings. Gardner v. Broderick, supra; Uniformed Sanitation Men Ass'n, Inc. v. Commissioner of Sanitation, supra.
39
In Confederation of Police, where the plaintiffs were suspended or discharged for refusing to testify after being first advised that anything they said could be used against them in subsequent criminal proceedings, the disciplinary action taken against them was held to be constitutionally infirm under the holdings in Gardner and Sanitation Men:
40
'These discharges were clearly unconstitutional under the rulings of Gardner and Uniformed Sanitation Men. The IAD inquiry was in no sense an 'accounting of public faith' as the questions were not 'specifically, directly, and narrowly' related to official duties and the officers were not advised that their answers would not be used against them in criminal proceedings.' Confederation of Police v. Conlisk, 489 F.2d at 895.
41
In the instant case, defendant argues that (1) at the time he testified Rule 51 was in force and effect and represented a clear threat of discharge or suspension if he refused to testify; (2) his testimony was therefore coerced in the same sense as was the testimony in Garrity because he was faced with the prospect of disciplinary action if he refused to testify; (3) the coerced testimony was subsequently used against him as an essential part of the Government's case-in-chief, and was the sole basis for his conviction; and (4) since 'the protection of the individual under the Fourteenth Amendment against coerced statements prohibits use in subsequent criminal proceedings of statements obtained under threat of removal from office', 385 U.S. at 500, 87 S.Ct. at 620, his conviction should be reversed.
42
We believe defendant's reliance upon the aforementioned decisions is misplaced. Had defendant admitted extorting money from tavern owners, neither his testimony nor the fruits thereof could have been used against him in a subsequent prosecution. Garrity v. New Jersey, supra. Had he exercised his Fifth Amendment privilege, he could have attacked the legality of any subsequent disciplinary action against him on the basis of Gardner and Sanitation Men. But we find nothing in these decisions or in this court's holding in Confederation of Police which grants a witness before the grand jury the third alternative which, in substance, is proposed by the defendant in the instant case: the right under such circumstances to knowingly make a false material declaration while testifying under oath before a grand jury.
43
As the Second Circuit Court of Appeals stated in United States ex rel. Annunziato v. Deegan, 440 F.2d 304 (2nd Cir. 1971), upholding the conviction of a public employee for perjury based upon testimony obtained under threat of discharge:
44
'Appellant was not prosecuted for past criminal activity based on what he was forced to reveal about himself; he was prosecuted for the commission of a crime while testifying, i.e., perjury. In short, while a public employee may not be put to the Hobson's Choice of self-incrimination or unemployment, he is not privileged to resort to the third alternative, i.e., lying.' 440 F.2d at 306.
45
In sum, Garrity and its progeny do not proscribe the use, in a criminal prosecution under 18 U.S.C. 1621 or 1623, of a defendant's allegedly perjurious statements, even if obtained under circumstances such as those of the instant case. Garrity provides the witness with adequate protection against the government's use, in subsequent criminal proceedings, of information obtained as a result of his testimony, where his refusal to testify would form the basis for disciplinary action against him. Gardner and Sanitation Men provide the witness with a shield against such disciplinary action based upon his refusal to testify, in cases in which he refuses to do so, believing that his testimony or the fruits thereof can be used against him in subsequent criminal proceedings.
46
Together, these decisions provide adequate protection of the witness's Fifth Amendment rights. We find no reason or justification for extending this umbrella of protection to shield a witness against prosecution for knowingly giving false testimony.
47
The judgment of the district court is therefore affirmed.
48
Affirmed.
1
Senior District Judge William J. Campbell of the Northern District of Illinois is sitting by designation
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138 F.2d 116 (1943)
UNITED STATES CANE SUGAR REFINERS' ASS'N et al.
v.
McNUTT.
No. 307.
Circuit Court of Appeals, Second Circuit.
August 27, 1943.
*117 Sullivan & Cromwell, of New York City (L. A. Crosby and Philip L. Miller, both of New York City, of counsel), for petitioners.
Wendell Berge, Asst. Atty. Gen., and Oscar A. Provost and Edward G. Jennings, Sp. Assts. to Atty Gen. (Edward B. Williams, of Washington, D. C., Atty., Federal Security Agency, of counsel), for respondent.
Before SWAN, CHASE, and CLARK, Circuit Judges.
CHASE, Circuit Judge.
After extensive hearings held in accordance with the requirements of the Federal Food, Drug, and Cosmetic Act, of 1938, 52 Stat. 1040, 21 U.S.C.A. §§ 301-392, the Federal Security Administrator promulgated amended regulations which established definitions and standards of identity for canned apricots, cherries, peaches and pears. In so doing he undertook to act pursuant to § 401 of the above statute which provides as follows:
"Sec. 401 [§ 341]. Whenever in the judgment of the Administrator[1] such action will promote honesty and fair dealing in the interest of consumers, he shall promulgate regulations fixing and establishing for any food, under its common or usual name so far as practicable, a reasonable definition and standard of identity, a reasonable standard of quality, and/or reasonable standards of fill of container. * * * In prescribing a definition and standard of identity for any food or class of food in which optional ingredients are permitted, the Administrator shall, for the purpose of promoting honesty and fair dealing in the interest of consumers, designate the optional ingredients which shall be named on the label. * * *"
Sec. 403 provides (a) that a food shall be deemed misbranded if in any particular its label is false or misleading; or, inter alia, if it purports to be, or is represented to be, a food for which a definition and standard of identity has been promulgated as provided in § 401 unless "its label bears the name of the food specified in the definition and standard, and, insofar as may be required by such regulations, the common names of optional ingredients * * * present in such food." § 403(g) (2).
By virtue of § 701(e) the administrator may act upon his own motion or upon the application setting forth reasonable grounds for action, of all, or a substantial portion of any interested industry. When he does take such action he is required to hold a public hearing upon any proposal to issue, *118 amend, or repeal any regulation contemplated by certain sections of the statute of which § 401 is one and at the hearing any interested person may be heard in person or by his representative. The Administrator shall make public his action in issuing, amending and repealing the regulation, or in determining not to take such action, as soon as practicable after completion of the hearing.
Sec. 701(f) (1) provides that: "In a case of actual controversy as to the validity of any order under subsection (e), any person who will be adversely affected by such order if placed in effect may * * * file a petition with the Circuit Court of Appeals of the United States for the circuit wherein such person resides or has his principal place of business, for a judicial review of such order. * * *"
Sec. 701(f) (3) confers jurisdiction upon such Circuit Court of Appeals, (so far as now invoked) to affirm the order, or to set it aside in whole or in part temporarily or permanently. It provides that the findings of the Administrator as to the facts shall be conclusive if they are supported by substantial evidence.
Following the above mentioned hearings, at which all these petitioners were represented, the Administrator duly promulgated, with regulations, the order which the petitioners are now seeking to have reviewed. Insofar as we are presently concerned the regulations dealt with the sweetening ingredients of the canned fruits previously mentioned and in respect to canned peaches, which may be taken as typical for all, provided in substance that all sugar might be used for sweetening though, as optional saccharine ingredients, dextrose might be used in stated proportions in combination with sugar and so might corn sirup. For the purposes of the regulations sugar was defined as "refined sucrose or invert sugar sirup. The term `invert sugar sirup' means an acqueous solution of inverted or partly inverted, refined or partly refined sucrose, the solids of which contain not more than 0.3 percent of weight of ash, and which is colorless, odorless, and flavorless except for sweetness." Dextrose was defined as "the hydrated or anhydrous, refined monosaccharide obtained from hydrolized starch." Corn sirup was defined as "an aqueous solution obtained by the incomplete hydrolysis of cornstarch, and includes dried corn sirup; the solids of corn sirup and of dried corn sirup contain not less than 58 percent by weight of reducing sugars."
It was further provided that the optional packing media which contained an added sweetener, that might be sucrose or sucrose in combination with dextrose or with dextrose and corn sirup, should be designated as (3) slightly sweetened water or (4) light sirup; or (5) heavy sirup; or (6) extra heavy sirup; or (7) slightly sweetened peach juice; or (8) light peach juice sirup; or (9) heavy peach juice sirup; or (10) extra heavy peach juice sirup as the case might be. And when a sweetened packing media was used it was made a sufficient compliance with labeling requirements in that respect to use only the appropriate name from the above list without disclosing the fact that the sweetener was all sugar or sugar in one of the permitted combinations. Before this, canners of these fruits might use dextrose or corn sirup as a sweetener only if that fact was disclosed on the label. It is because this requirement was done away with that the petitioners now contend that they were adversely affected in a case of actual controversy to give them "standing to appeal" so as to bring this petition to review within the scope of § 701(f) (1).
The regulations further provided in respect to the content of the optional packing media already listed by name and the proportions to sucrose in which dextrose and corn sirup might be used that:
"As used in this paragraph the term `water' means, in addition to water, any mixture of water and peach juice; and the term `peach juice' means the fresh or canned expressed juice of mature peaches, of any varietal group, specified in paragraph (b) of this section, to which no water is added, directly or indirectly.
"Each packing media (3) to (10), inclusive, is prepared with a liquid ingredient and a saccharine ingredient.
"* * * The saccharine ingredient from which packing media (3) to (10), inclusive, are prepared is one of the following: sugar; or any combination of sugar and dextrose in which the weight of the solids of the dextrose used is not more than one-half the weight of the solids of the sugar used; or any combination of sugar and corn sirup in which the weight of the solids of the corn sirup used is not more than one-third the weight of the solids of the sugar used; or any combination of sugar, dextrose, and corn sirup in which *119 twice the weight of the solids of the dextrose used added to three times the weight of the solids of the corn sirup used is not more than the weight of the solids of the sugar used; except that packing media (7) to (10), inclusive, are not prepared with any invert sugar sirup or corn sirup other than dried corn sirup, * * *." There was appended a prescribed range of densities, as measured on the Brix hydrometer fifteen days after the peaches were canned, for packing media (3) to (10) inclusive.
One result was to permit canners of the fruits to use some dextrose or corn sirup or both in combination with sugar without in express terms so labeling the product. As both of these optional sweeteners, though less sweet than sugar, were less expensive to use, the petitioners were convinced that fruit canners would be induced to use them to avoid the use of sugar, and, to the extent that this might be done, consider themselves adversely affected by the order.
The respondent, though defending his order on the merits as well, first contends that the petition to review must be dismissed on the ground that the petitioners brought it not as consumers of the regulated product or even as competitors in the production and sale of it, but only in their supposed right as suppliers of an ingredient used in the manufacture of it. We will, accordingly, first attempt the solution of that rather difficult problem.
It is clear that the petitioners are "adversely affected" only by way of some competition with dextrose or corn sirup producers and suppliers or both which but for the statute and the result of its administration they would encounter anyway and to a greater degree. And it is adequately clear that they would have no standing to appeal, § 701(f) (1) aside, by virtue solely of added competition made possible or probable by regulations promulgated in accordance with § 401. That would be but damnum absque injuria as Judge Frank has recently shown in his comprehensive opinion where an analogous situation was considered under the Bituminous Coal Act of 1937, 15 U.S.C.A. § 828 et seq. Associated Industries of New York State, Inc., v. Ickes, 2 Cir., 134 F.2d 694. Nevertheless a motion to dismiss was there denied and the right to review in behalf of consumers of the regulated product was upheld on the ground that a consumer, faced with the prospect of having to pay higher prices for coal because of the order, was a "person aggrieved" within the provisions of § 6(b) of the Act. The reasoning which led to that conclusion would, we think, apply as well to a petition to review in accordance with §701(f) (1) of the statute here involved brought by one who would be "adversely affected" if the order became effective provided, of course, there was "a case of actual controversy as to the validity" of the order which must be more than merely colorable. Land O'Lakes Creameries, Inc., v. McNutt, 8 Cir., 132 F.2d 653; A. E. Staley Company v. Secretary of Agriculture, 7 Cir., 120 F.2d 258. The latter requirement, obviously, can have substance only when it is based upon some action of the Administrator by which petitioners are "adversely affected" within the statutory meaning of that term. If they are not so affected they can present no actual controversy of which the court can take cognizance. On the other hand persons might be "adversely affected" by action of the Administrator so clearly lawful that there would be no "case of actual controversy" to make a petition to review more than merely frivolous. And so, to support a petition to review both these requirements must be met. We do not find it presently necessary to deal with them separately, however.
In both of the cases just cited the right to review regulations promulgated under the statute here involved was upheld. That was accompanied with the expression of some doubt on the part of the court in the Land O'Lakes case where the regulations had fixed a definition and standard of identity for oleomargarine and the petitioners were manufacturers and purveyors of butter, a product already in competition with oleomargarine and put into keener competition with it as a result of the regulations. That case differs from the instant one in no material respect unless it is distinguishable on the ground that here the competition the petitioners are called upon to meet is too problematical to affect them adversely within the meaning of § 701(f) (1).
In the Staley case the "actual controversy" of which the court took cognizance on a petition to review regulations promulgated under the instant statute, was between a purveyor of corn sirup which, but for the regulations, could be used as an ingredient in making sweetened condensed milk and purveyors of sugar *120 whose use was freely permitted. The regulations excluded such use of corn sirup entirely and so deprived the petitioner of all opportunity to compete in that field in the future. It was held that that "adversely affected" it and was enough to support the questioned jurisdiction of the petitioner under § 701. The instant case is closely akin to the Staley case and yet it does not fall readily into what we conceive to be the meaning of the term "adversely affected" in the light of the principles relied on in our Associated Industries case. The supposed adverse effect is one which leaves the petitioners' product free of all restriction. The petitioners are "adversely affected" only in that their competitors are not hampered more. But though such a relationship to the subject matter of the regulations may be enough in some instance which does not now come to mind, it can only be so when the adverse effect of the regulations, present or future, is "of sufficient immediacy and reality." Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 U.S. 270, 61 S.Ct. 510, 512, 85 L.Ed. 826. The adverse effect must be a result that is not only reasonably sure to follow the enforcement of the regulations but will be "something more than nominal or highly speculative." National Broadcasting Co. v. Federal Communications Commission, 76 U.S. App.D.C. 238, 132 F.2d 545, 548. It is inevitable that such regulations as these will affect in one way or another a large number of persons. In a sense they "affect" the public at large for whose benefit they are promulgated. It is to be expected that this effect may be thought to be "adverse" by a lesser, but still large number of persons not engaged in making or selling the standardized product. It is, however, inconceivable that Congress intended to permit all persons who could show a remote and uncertain likelihood that the regulations would injuriously affect the market for their produce to file petitions to review merely because they decided that they had been, or might possibly be, put in danger of that. In order to prevent such obstruction to the orderly administration of the statute by virtually unlimited petitions to review, it is necessary that the class of petitioners who have "standing to sue" be confined to those who can show some direct adverse affect traceable with reasonable certainty to the regulations promulgated.
As we said in the Associated Industries case, a consumer threatened with the prospect of having to pay higher prices for coal because of an order which fixes prices and prevents competition among those from whom the consumer purchases is a person "aggrieved." The effect in that instance was direct as well as certainly adverse. So, too, increased competition may be enough, though the policy behind the statute is to maintain competitive practices that are in the public interest, to show that a person has been "adversely affected" by an administrative order. Federal Communications Commission v. Sanders Bros. Radio Station, 309 U.S. 470, 642, 60 S.Ct. 693, 84 L.Ed. 869, 1037. Yet giving effect to such considerations by no means requires their extension to include all persons whose desire to review such regulations as these happens to be created by the mere possibility of having to meet competition in business they would rather have eliminated. The paramount need for the orderly and the reasonably expeditious administration of the statute by the official charged with the duty of making it effective in the public interest creates at least the need of limitations upon the construction of the term "adversely affected" to do away with delays that otherwise could be brought about by persons upon whom the adverse effect of the regulations would at most be so negligible that it should be disregarded to effectuate the public interest the statute was designed to promote.
When the regulations are considered in the light of their effect upon the petitioners, it seems adequately clear that the latter do not fall into the class Congress has authorized to seek a review. The reguations do not prevent the use of sugar in the canning of these fruits to whatever extent canners may desire to use it. On the contrary, they require its use in every instance and so far as that requirement makes necessary the use of more sugar than before there is, of course, no adverse effect upon petitioners. What then is the threatened increased competition which the petitioners face? It is merely that the canners may use the permitted amounts of either dextrose or corn sirup or both without mentioning those products by name on the label of their product. There is no claim that the permitted sweeteners, other than sugar, are not wholesome or that consumers would be dissatisfied with the products so sweetened and erroneously attribute their dislike to the use of sugar as a sweetener. What the petitioners are really claiming is that the *121 regulations will do away with the remote, speculative sales resistance of the public to the marketing of the canned fruits sweetened in some part with dextrose or corn sirup which might be present if the labels on the cans disclosed, by naming them, that the permitted amounts of one or the other or both of the optional sweeteners had been added to the required sugar. If such a tenuous likelihood of injury were enough to cause the petitioners to be "adversely affected," the opportunity for maintaining petitions to review such regulations as these would be so unlimited as to be a serious threat to the practical administration of the statute. In our opinion, therefore, petitioners neither have been, nor will be, adversely affected within the meaning of § 701(f) and this court, accordingly, has no jurisdiction to review the regulations.
Petition dismissed for lack of jurisdiction.
NOTES
[1] By Reorganization Plan No. IV, 54 Stat. 1234, 5 U.S.C.A. § 133t note, the Federal Food and Drug Administration was transferred from the Department of Agriculture to the Federal Security Agency and the functions of the Secretary of Agriculture in the administration of the Act were transferred to the Federal Security Administrator. The terms actually used in this statute have been changed accordingly.
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ACCEPTED
14-14-00683-CV
FOURTEENTH COURT OF APPEALS
HOUSTON, TEXAS
11/19/2015 10:56:01 PM
CHRISTOPHER PRINE
CLERK
No. 14-14-00683-CV
FILED IN
14th COURT OF APPEALS
HOUSTON, TEXAS
IN THE COURT OF APPEALS 11/19/2015 10:56:01 PM
FOR THE FOURTEENTH DISTRICT OF TEXAS
CHRISTOPHER A. PRINE
Clerk
FREDERIC SCOTT DEAVER,
Appellant,
vs.
RIDDHI DESAI
and
SHILPI P. DESAI,
Appellees.
Appeal from the
295th Judicial District Court, Harris County, Texas
APPELLANT’S RESPONSE TO APPELLEES’
JOINT MOTION FOR REHEARING
FREDERIC SCOTT DEAVER
Pro Se Litigant - Appellant
[email protected]
5042 Wilshire Blvd. #35745
Los Angeles, California 90036
Telephone: (832) 889-5089
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO
APPELLEES’ JOINT MOTION FOR REHEARING - Page 1
TABLE OF CONTENTS
APPELLANT’S RESPONSE TO APPELLEES’ JOINT MOTION FOR
REHEARING........................................................................................................3
I. As to Appellees Section II.2.……………………………………..……..3
II. As to Appellee’s Section II.2.i.…………..…………………………….4
III. As to Appellee’s Section II.2.ii………………...……………………...7
IV. As to Appellee’s Section II.2.iii............................................................8
V. As to Appellee’s Section II.2.iv..............................................................9
PRAYER FOR RELIEF……………………………….…..……………………..9
EXHIBIT A……………………………………………………………………..11
CERTIFICATE OF COMPLIANCE……………………………………………63
VERIFICATION………………………………………………………………...64
CERTIFICATE OF SERVICE…………………………………………………..65
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO
APPELLEES’ JOINT MOTION FOR REHEARING - Page 2
No. 14-14-00683-CV
IN THE COURT OF APPEALS
FOR THE FOURTEENTH DISTRICT OF TEXAS
FREDERIC SCOTT DEAVER,
Appellant,
vs.
RIDDHI DESAI
and
SHILPI P. DESAI,
Appellees.
Appeal from the
295th Judicial District Court, Harris County, Texas
APPELLANT’S RESPONSE TO APPELLEES’
JOINT MOTION FOR REHEARING
TO THE HONORABLE COURT OF APPEALS:
Appellant Frederic Scott Deaver (hereinafter, “Appellant”) submits his
response to Appellee’s Joint Motion for Rehearing in the referenced proceedings.
I. As to Appellees Section II.2.
A link referencing a website no more re-publishes or changes that website
than does a modern publication’s quote of Dickens re-publishes or changes “A
Tale of Two Cities”. No changes whatsoever have occurred since August 2011 to
the specific website at
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 3
http://www.viewsender.com/yijianhistory/oldbabystealerwebsite/riddhidesai/Riddh
iDesai.htm, the website to which Appellees themselves limited the complaint that
is the subject of this appeal. As a side note, the “re-publishing” Appellees are
alleging would have occurred after the passing of the Defamation Mitigation Act,
which has explicit requirements regarding the mitigation of a complaint to which
the Appellees have not adhered. Though not competent at legal matters, Appellant
understands that the questions related to statutes of limitations are two: “When did
either of the Appellees learn of published material they deem offensive?” and
“After discovery, did their actions to recover alleged damages fall within a
reasonable time period afterwards?” If that’s a fair assessment, then when any
other individual made, or could have made, such a discovery is irrelevant – they
are not suing, and presumably didn’t take offense. Only the Appellees’ discovery
and when they finally did something about the discovery matter. Appellant
therefore sees at minimum no logical value to any of Appellee’s arguments in their
motion for re-hearing, and by extension doesn’t understand how there could be any
legal value to them.
II. As to Appellee’s Section II.2.i.
The issue of Appellant having requested permission in writing from the 295 th
District Court back on May 24, 2014 to record audio in the courtroom to
compensate for his hearing and memory losses was brought to this Appellate
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 4
Court’s attention by Appellant himself in his filing with this Appellate Court on or
about February 7, 2015 entitled “Appellant’s Response”. Additionally, Appellant
filed with the 295th District Court on August 24, 2014 a document entitled “Motion
for Recusal for Cause” describing in great detail the circumstances of the audio
recording and a kangaroo court proceeding conducted by Judge Caroline E. Baker
and Riddhi Desai based upon it in the purposefully-engineered absence of
Appellant during the Appellate Court’s ordered abatement period following
Appellant’s original notice of appeal. See EXHIBIT A. If the Appellate Court feels
it necessary, Appellant respectfully requests the Appellate Court review those
submissions and their attachments.
In summary, the basis for that kangaroo court proceeding was a request to
record audio in the lower court made by letter by Appellant on May 24, 2014 to
both the 295th District Court and the Harris County District Clerk to reserve his
Americans with Disabilities Act of 1990 rights to use audio recordings of
courtroom testimony to compensate for Appellant’s hearing and memory losses.
Neither the 295th District Court nor the District Clerk responded positively or
negatively to the letter, and Appellant’s first appearance before the 295 th District
Court did not occur until August 4, 2014, at which time he exercised his presumed
right to record the proceedings on a device specifically and obviously designed for
audio recording in full view of the Judge, the bailiff, the court stenographer, and
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 5
other court personnel. There was nothing “covert” about the recording – Appellant
openly tested that the recording device was working properly in full view of all of
the participants, and he had no reason to believe he did not have approval to record
the session. There were at that time no postings in the courtroom inhibiting audio
recording, none of the parties had requested the record be sealed.
After the hearing, Appellant openly posted, because he had no reason to
believe he could not do so, the audio recording to an online journal he was keeping
at http://www.viewsender.com/IdentityTheftByLawyer/default.html. That web
page is at a completely different Internet address from the only web address
complained of by Appellees in their original complaint, which was
http://www.viewsender.com/yijianhistory/oldbabystealerwebsite/riddhidesai/Riddh
iDesai.htm. Even a cursory glance at the two websites reveals they have
completely different content and subject matter – one website is devoted to the
court process itself and events occurring since the April, 2014 filing of Appellees’
original suit, and the other website chronicles the identity thefts and other crimes
committed by Riddhi and Shilpi Desai specifically in the period between
September, 2008 and August, 2011.
Appellant believes and can support the assertion that Appellees are
deliberately attempting to deceive and confuse the Appellate Court by lumping in
everything on the Internet they don’t like, much of it written and/or maintained by
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 6
persons other than Appellant, and labeling it as part of Appellant’s website at
http://www.viewsender.com/yijianhistory/oldbabystealerwebsite/riddhidesai/Riddh
iDesai.htm.
There is no general order of censorship or any court order in force
prohibiting Appellant’s mounting of other websites concerning other subject
matter, and should Appellees wish to continue harassing Appellant about his
exercise of free speech on matters of public import, Appellees’ right to redress are
described in specificity in the Defamation Mitigation Act. None of these matters
are pertinent to the specific matter appealed to this Court, which was restricted by
Appellees’ own hand to the website at
http://www.viewsender.com/yijianhistory/oldbabystealerwebsite/riddhidesai/Riddh
iDesai.htm which has remained unchanged since August, 2011. The fact remains
that Appellees became generally aware of the specific website of which they have
complained in 2008, and have been aware of its present form since August, 2011.
As noted by the Appellate Court in its rendered opinion, the statute of limitations
begins running when the Appellees’ first became aware of the material. As noted
previously, the “re-publishing” Appellees are alleging would have occurred after
the passing of the Defamation Mitigation Act, which has explicit requirements
regarding the mitigation of a complaint to which the Appellees have not adhered.
III. As to Appellee’s Section II.2.ii.
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 7
The idea that a reference to a website in a separate letter to public officials
“republishes” that website is ludicrous on its face. By that convoluted and
incestuous logic, the references to the website in this very court proceeding would
“republish” the website. The fact remains that Appellees became generally aware
of the specific website of which they have complained in 2008, and have been
aware of its present form since August, 2011. As noted by the Appellate Court in
its rendered opinion, the statute of limitations begins running when the Appellees’
first became aware of the material. Again, the “re-publishing” Appellees are
alleging would have occurred after the passing of the Defamation Mitigation Act,
which has explicit requirements regarding the mitigation of a complaint to which
the Appellees have not adhered.
IV. As to Appellee’s Section II.2.iii.
As with the paragraph above, the idea that a reference to a website in a
separate website maintained and edited by someone else “republishes” that website
is ludicrous on its face. The fact remains that Appellees became generally aware of
the specific website of which they have complained in 2008, and have been aware
of its present form since August, 2011. As noted by the Appellate Court in its
rendered opinion, the statute of limitations begins running when the Appellees’
first became aware of the material. Again, the “re-publishing” Appellees are
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 8
alleging would have occurred after the passing of the Defamation Mitigation Act,
which has explicit requirements regarding the mitigation of a complaint to which
the Appellees have not adhered.
V. As to Appellee’s Section II.2.iv.
There is nothing about this section of Appellees’ motion for rehearing that
makes any sense whatsoever. The statement admits that the website created was
another website, not the one which is the subject of this appeal, and again makes
the same convoluted “republish” argument. As noted in the by the Appellate Court
in its rendered opinion, the statute of limitations begins running when the
Appellees’ first became aware of the material, unless and until Appellees can show
there have been significant and meaningful changes to that content, which they
can’t and haven’t. Again, the “re-publishing” Appellees are alleging would have
occurred after the passing of the Defamation Mitigation Act, which has explicit
requirements regarding the mitigation of a complaint to which the Appellees have
not adhered.
PRAYER FOR RELIEF
Appellees’ arguments are intentionally deceptive, further delay these
proceedings in violation of the TCPA’s stated goal of expediting interlocutory
appeals, and are frivolous in nature. Appellant respectfully requests that Appellees’
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 9
motion be denied, and that penalties be imposed upon Appellees as deemed lawful
and appropriate by the Appellate Court.
[email protected]
5042 Wilshire Blvd. #35745
Los Angeles, California 90036
Telephone: (832) 889-5089
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 10
EXHIBIT A
CAUSE NO. 2014-18950
RIDDHI DESAI § IN THE DISTRICT COURT OF
SHILPI PANKAJ DESAI, §
Plaintiffs §
§ HARRIS COUNTY, TEXAS
-V- §
§
FREDERIC SCOTT DEAVER § 295th JUDICIAL DISTRICT
Defendant §
MOTION FOR RECUSAL FOR CAUSE
TO THE HONORABLE DISTRICT COURT JUDGE:
NOW COMES Defendant, Frederic Scott Deaver, and respectfully requests that the Court
immediately recuse Judge Caroline E. Baker for cause.
I.
CRIMINAL ACTS AND DERELICTIONS OF DUTY
Defendant makes the following allegations, including the following deliberate criminal
acts and derelictions of duty, against Judge Caroline E. Baker:
1. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, deliberately interfering with Defendant’s Constitutional
right to due process by removing from, causing to be removed from, ordering to be
removed from, or causing not to be entered into the Judgments/Events tab of the
Office of Harris County District Clerk’s Search application database any reference to
any order, setting of hearing, or other document of any kind for any portion of the
period August 15, 2014 through August 21, 2014 as shown in Exhibit A appended to
this motion;
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 11
2. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, deliberately interfering with Defendant’s Constitutional
right to due process by concealing, causing to be concealed, ordering to be concealed,
or causing to be entered improperly into the Images tab of the Office of Harris
County District Clerk’s Search application database any access to the true contents of
the image identified as 62029407 and dated 8/19/2014 as shown in Exhibit B
appended to this motion;
3. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, deliberately interfering with Defendant’s Constitutional
right to due process by inserting, causing to be inserted, ordering to be inserted, or
allowing to be inserted by any person a single sheet of paper containing only a Notice
of Hearing for Temporary Injunctions dated September 25, 2014 into a US Post
Office Delivery Confirmation envelope number 0307 0020 0003 5580 3695, having
that envelope delivered to Defendant, and falsely characterizing that delivery as legal
service of notice of a different hearing, for the purpose of denying knowledge to
Defendant of that different hearing in which it was Judge Caroline E. Baker’s intent
to deprive Defendant and Defendant’s daughter due process, freedom of speech,
personal liberty, or freedom of association between Defendant and any other party,
including Defendant’s daughter;
4. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, previously permitting without scheduling a hearing on
requested sanctions the exact same behaviors by Riddhi Desai with respect to false
document mailings, when Riddhi Desai expressly left out of a mailing a document she
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 12
sent to a public server that illegally published yet again Defendant’s driver’s license
number and Defendant’s daughter’s Social Security, both felonies (see appended
Motion for Sanctions);
5. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, previously permitting without addressing discipline fopr
Riddhi Desai, the exact same behaviors by Riddhi Desai with respect to false
document service, when Riddhi Desai provided addresses she knew to be invalid to
the process server for her original petition in the hopes Defendant would not be
served and therefore would not answer;
6. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, intentionally creating and manipulating through one or
more of the acts enumerated above a situation where Defendant and Defendant’s
daughter could be deprived of free speech and prior restraint of free speech invoked,
in violation of both the U.S. and Texas Constitutions, under cover of the Court’s
unconstrained powers authorized when contempt is shown for the Court, knowing full
well no such contempt has ever been shown by Defendant or Defendant’s daughter;
7. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, refusing to honor the Court’s mandated duty to protect
Defendant’s and Defendant’s daughter’s rights to due process by allowing access to
the Court via scheduling a hearing on Defendant’s August 11, 2014 motion for
sanctions against Plaintiff emanating from Plaintiffs intentional distribution of
Defendant’s driver’s license number and Defendant’s daughter’s Social Security
number in the public sections of the Harris County Clerk’s Office databases;
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8. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, allowing Plaintiffs to venue-shop and specifically select
Judge Caroline E. Baker’s Court to hear a case that she knew or should have known
had already been heard and denied by three judges in four sessions over seven years,
that she knew or should have known had exhausted all applicable statutes of
limitations two to six years prior to this filing, that she knew or should have known
was being filed for malicious and impermissible purposes, and for which she knew
that the current status of the law as reflected by the widely publicized Kinney v.
Barnes case currently before the Texas Supreme Court would never allow Plaintiffs’
desired goal of permanent or temporary injunction;
9. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, intentionally engaging in one or more of the acts
enumerated above to extend the reach and effect of Plaintiffs’ felonious acts,
including identity theft and improper use of Social Security numbers that do not
belong to them;
10. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, and after having engineered by deceit the absence of
Defendant from a hearing the Defendant could know nothing about, that the Court
colluded with Plaintiffs to contrive a means derive additional information to use for
the purpose of future identity theft to intimidate Defendant, Defendant’s daughter,
and Defendant’s witnesses. Defendant’s indigent status has been known to this Court
since the initial filing of the Pauper’s oath in June. Defendant’s income and financial
status has been discussed, investigated, and assessed for child support purposes, both
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originally as a payer and now as a payee for eight years now in the Family Law
Court. Defendant’s financial and income status can easily be verified by a legitimate
request from an authorized party, including the Court, with a phone call to any
number of authorities, including the Internal Revenue Service or Texas Workforce
Commission or to my bank However, Plaintiffs are known to Defendants to be felons
who have stolen Defendant’s and Defendant’s daughter’s identity , and do not
constitute a legitimate or authorized party. Judge Caroline E. Baker has shown herself
to have had malicious intent towards Defendant and Defendant’s daughter as shown
in the entirety of the foregoing list of bad acts and is likely to pass to Plaintiffs
identifying information by means both fair and foul, and is therefore no longer a
legitimate or authorized party. Defendant will gladly provide any other member of the
Court or government any information they desire, including home visits, to validate
Defendant or Defendant’s daughter’s indigent status as caused by Plaintiffs’ felonious
acts;
11. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, In a kangaroo-court proceeding in which Defendant was
not allowed to be present because he was never served or told via any of the many
communications mediums he has provided the Court – telephone voice, telephone
text, electronic mail, Harris County Clerk of Court Search database, U.S. Post Office
mail, or private delivery service - Judge Caroline E. Baker has further directly
threatened Defendant’s right to due process, to free speech, to personal freedom, and
to quality time spent with his daughter.
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12. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, intentionally exploiting one of more of the following
discriminations, prejudices imbalances, or artificially constructed situations described
to the Court in a letter dated May 24, 2014:
“The damage from the Desai’s identity theft continues to this day, and so I am
forced to go pro se to defend myself in this lawsuit. I understand I have a
relatively short time to respond, and I do not have the funds to hire an attorney. I
do not know how I am going to afford all of the fees of a lawsuit. I understand
that now the Supreme Court requires electronic filing of documents, and I have no
clue how to go about that. But the biggest challenge I face is that Riddhi Desai
and Shilpi Desai waited seven years to file their lawsuit, I presume to allow their
identity theft to achieve its maximum effect, and of course in that time I have lost
contact with witnesses and evidence as the identity theft has forced my daughter
and me to move several times. The website listed in their suit is one I mounted to
try to obtain a lawyer to sue them before I was served with their suit, so their suit
represents an attempt to box me out of any due process whatsoever.
“That is the background against which I am making this request to accommodate
some special circumstances Sophia and I have. With the distractions that go with
being a single custodial parent with being a single custodial parent with no money
for child care, and with trying to find employment and a lawyer and money to live
on, we were facing enough challenges as it was. Now on top of that, I’ve got to go
to court with no legal experience, no staff, and no time. In addition to that, I will
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be the only male among the principals in the courtroom, and to make it worse, I
will be the only male in the courtroom who was granted custody of a small child
over the mother (traditionally in Texas, the woman’s sphere of control), I will be
the only non-lawyer (and non-member of the Texas Bar Association) in the
courtroom, I will be the only indigent person in the courtroom, I will be the only
person in the courtroom who actually produces things to make my living, and I
will be the only person babysitting an eight-year-old while trying to present my
case in the courtroom. I will be facing an opponent who is all about money and
power, and I’ll be facing a Judge who must stand for election in a few months and
needs both money and influence from lawyers to fund her campaign (no reflection
on the Judge, just one of the many unfair realities of being forced to go pro se in a
state where Judges run for election). We’re not as much concerned about the
integrity of the Judge per se – it is more that plaintiffs are greedy and
manipulative, and will exploit every nuance or slightest opportunity to remind the
Judge of his dilemma.
“Proof of that kind of dirty behavior is clearly shown in the history of the Family
Law Court proceedings. In the very beginning of that case, a corrupt judge by the
name of Ronald R. Pope was recused from our case after an investigation by the
Texas Rangers. He had enlisted his wife to file a false police report against me
using a description from a downloaded copy of my resume on the Internet in
retaliation for fliers I had posted (under permit from the City of Sugar Land)
regarding gender bigotry in his court. Of course, I have no criminal history of any
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kind (one of many reasons resulting in my eventually being awarded primary
custody of Sophia). Sophia’s first custody hearing was to have been heard before
Judge Pope shortly thereafter, and it was Judge Pope’s intention to use the
manufactured assault charge as a pretext to not only throw the book at me in
retaliation for my political leanings, but take my daughter from me as well.
Since then, at every chance she can, Riddhi Desai brings up Judge Pope’s recusal
to the presiding Judge – the idea is to inflame the new Judge and create an
impression that somehow we are a threat to that Judge’s authority (we are no
threat to anyone - we are the most open, transparent, and apolitical people you’ll
ever meet, and frankly we detest all of these various manipulations that plaintiffs
engage in to keep the attention away from their original and continuing identity
thefts). To their credit, none of the Judges who have heard our case have bit, but
they were all males less inclined to place weight on emotion. We are concerned
about gender inequality playing a role in a case before a female judge because I
will be the only male in the courtroom, and we have seen instances in other
courtrooms where one man’s ”courage” becomes another woman’s “aggressive
behaviors”.
“On top of all of this, my daughter and I remain at extreme danger of further harm
from Plaintiffs’ continuing identity theft, not just from the thefts of the past seven
years, but from new thefts that will occur from new information we will need to
submit to satisfy the Court’s needs. I am all three of a witness to plaintiffs’
crimes, an expert investigator of those crimes (I’ve been awarded numerous
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REHEARING - Page 18
patents as a result of techniques I’ve developed for this case to monitor computers
to detect criminal and other activity), and the victim of those crimes who has lived
seven years under extreme duress of the natural results of them. The Court is now
asking me (and my witnesses, who are terrified that plaintiffs will do the same to
them, having seen the effects for themselves upon my innocent daughter and me
– I would presume this extends to members of the jury as well, so I don’t know
whether it is wise to ask for a jury or not) to pretend all of the foregoing didn’t
happen and isn’t in full force and effect and to hand over all of the bullets
plaintiffs need to re-load their gun, with the empty promise that the Court can
somehow (no means offered) protect us from that which they couldn’t protect us
from before.
“I do not know what, if anything, this Court can or will do about any of the above.
Given the innate bias inherent in the situation of an indigent pro se defendant
having to face a lawyer of 26 years’ experience who committed the very crimes
that made the defendant both pro se and indigent, and given that the Judge
hearing the case belongs to the same private club as does the plaintiff (the Texas
Bar Association), and given the Judge is financially dependent upon lawyers to
raise money for re-election (as I understand it, this Judge has already lost one
election, and is very aware of the need for adequate campaign financing) and
needs the support of lawyers much more than he needs the support of an indigent
pro se defendant, you’d think there’d either be a special court for this kind of
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REHEARING - Page 19
case, or there would be court-appointed attorneys for the pro se defendant to
correct the imbalance.”
13. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, refusing to abide by her own words regarding recusal as
expressed in an interview that was part of her failed re-election bid in 2008:
“Independent, disinterested, fair, and competent judges are the very cornerstone
of American government. Constitutional Law, statutes and rules impose a duty on
judges to recuse themselves in any proceeding in which their impartiality might
reasonably be questioned or in which they have a personal bias, prejudice, or
personal knowledge concerning the case.“
14. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, refusing to honor her oath and responsibilities as a Judge,
including compliance with the following mandates of the Supreme Court’s Code of
Judicial conduct:
“A. A judge shall comply with the law and should act at all times in a manner that
promotes public confidence in the integrity and impartiality of the judiciary.
“B. A judge shall not allow any relationship to influence judicial conduct or
judgment A judge shall not lend the prestige of judicial office to advance the private
interests of the judge or others; nor shall a judge convey or permit others to convey
the impression that they are in a special position to influence the judge. A judge
shall not testify voluntarily as a character witness.”
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15. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, refusing to honor her oath and responsibilities as a Judge to
devote the time and attention required to hear Defendant’s motion on August 4, 2014
in its entirety or in a sincere manner, on several occasions referencing time challenges
associated with what she implied were far more important, visible, and career-building
cases, including great emphasis on a month-long environment case and a case at 1:00
p.m. that afternoon;
16. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, deliberately scheduling just one hour to hear an Anti-S.L.A.P.P.
matter with which she knew she was unfamiliar, having been reversed on appeal in the
one instance she had decided such a case, in which she was required by the rules of
evidence to consider and understand the totality of the website and all its contents, a
website which she knew from Defendant’s original response to have 2200 web page
links, and numerous videos and recordings, and also required to consider and
understand the totality of 84 pages of the Defendant’s response, with the knowledge
that both sides would require time to argue this massive amount of data. There is no
reasonable conclusion that can be drawn from assigning such a brief time to such a case
other than that “the fix was in”, that is, she’d made a determination even though it was
very clear from the recording of the trial she didn’t even know the appropriate rules of
evidence, the standards of proof, or any of the actual contents of the websites;
17. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, continually referencing the proceedings as a prelude to a
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temporary injunction hearing (reflecting a hidden agenda commensurate with
Plaintiffs’ originally expressed desire as the first hearing). Had Judge Caroline E. Baker
an honest agenda, she would have left open the possibility that the temporary injunction
hearing would never happen, since an unbiased decision on the Anti-S.L.A.P.P. motion
would have dismissed Plaintiffs’ petition and rendered a temporary injunction
unnecessary at all;
18. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, refusing to acknowledge, follow, or apply the fundamental rules
of evidence with respect to any element of this case. Judge Caroline E. Baker had an
absolute duty to consider and understand every single word of the website referenced
by Plaintiffs original petition because the link to the website was embedded in the body
of Plaintiffs’ petition. Any irritation or inconvenience the Court may experience from
the inclusion of all of that information should inure against Plaintiffs, not Defendant,
even though the material was created by Defendant – it was the Plaintiffs who included
it in their original petition. The applicable rule is from Texas Rules of Evidence, Article
I, General Provisions, Rule 107, which reads: “When part of an act, declaration,
conversation, writing or recorded statement is given in evidence by one party, the whole
on the same subject may be inquired into by the other, and any other act, declaration,
writing or recorded statement which is necessary to make it fully understood or to
explain the same may also be given in evidence, as when a letter is read, all letters on
the same subject between the same parties may be given. "Writing or recorded
statement" includes depositions.”
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Defendant had every right to fully explore all of the 2200 webpages to the extent
necessary to satisfy his prima facie or preponderance of the evidence requirements –
certainly enough evidence existed in the materials. But by scheduling merely an hour
(two hours were actually spent), the Judge forced Defendant to limit his remarks to just
a very few small elements (primarily the statute of limitations issue and briefly res
judicata). This deliberate blow-off of Defendant’s case by forcing time limits that were
laughably short for the purpose so that she could spent time on the more visible case
her crony Rick Perry would be impressed with is a travesty – what makes it worse is
that Judge Caroline E. Baker had no trouble making time for her new best buddy (and
presumed new under-the-table campaign contributor) Riddhi Desai when orchestrating
the in-absentia kangaroo court to deny Defendant due process;
19. With malice aforethought and singly or as part of a greater conspiracy in collusion
with Plaintiff Riddhi Desai, separately and apart from the rules of evidence violations
above, failing to follow the requirements of the TCPA statute itself with respect to
evidence:
“27.006(a) In determining whether a legal action should be dismissed under this
chapter, the court shall consider the pleadings and supporting and opposing affidavits
stating the facts on which the liability or defense is based.”
“Shall” is a very powerful word under the law - Judge Caroline E. Baker had no
legitimate recourse, when considered with Rule 107 above, but to consider all of that
evidence, all 2200 web links followed to their ultimate conclusions, all of the affidavits,
all 84 pages of Defendant’s original answers, no matter how long that took, no matter
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how many dinner parties she would have to miss. That is the law. That is not what
Defendant received from Judge Caroline E. Baker.
20. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, and through the combination of denying adequate time and
failing to adhere to the rules of evidence and evidentiary requirements of the statute,
denying Defendant an opportunity to add to his absolute, affirmative, and arguable
defenses, wasting what little time was provided on arguing matters Judge Caroline E.
Baker was already required by statute and rules of evidence to have understood and
considered. But Judge Caroline E. Baker never intended an honest outcome – a first
year law student would know that the Defamation Mitigation Act alone renders the
petition frivolous (and Plaintiffs did not deny they never asked me - the “publisher” –
directly to change anything about my website as required by the language of the statute:
“Sec. 73.055. REQUEST FOR CORRECTION, CLARIFICATION, OR
RETRACTION.
(a) A person may maintain an action for defamation only if:
(1) the person has made a timely and sufficient request for a correction,
clarification, or retraction from the defendant; or
(2) the defendant has made a correction, clarification, or retraction.
(b) A request for a correction, clarification, or retraction is timely if made during
the period of limitation for commencement of an action for defamation.
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(c) If not later than the 90th day after receiving knowledge of the publication, the
person does not request a correction, clarification, or retraction, the person may not
recover exemplary damages.
(d) A request for a correction, clarification, or retraction is sufficient if it:
(1) is served on the publisher;
[more follows]”
For example, Defendant should have been allowed to argue that any consideration of
Plaintiffs’ petition should never have occurred at all because by including the entirety
of the website link (and in fact, the totality of the Internet, if Plaintiffs latest version of
their “original” filing is to be believed, which adds to the link the phrase “and such
other numerous websites”, about as non-specific as you can get) Plaintiffs have violated
the “particularity” requirement of the defamation statute, which reads: “
Sec. 73.055. REQUEST FOR CORRECTION, CLARIFICATION, OR
RETRACTION.
(a) A person may maintain an action for
defamation only if:
1) the person has made a timely and sufficient request for a
correction, clarification, or retraction from the defendant;
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(3) states with particularity the statement alleged to be false and
defamatory and, to the extent known, the time and place of
publication;
(4) alleges the defamatory meaning of the statement; and
(5) specifies the circumstances causing a defamatory meaning of
the statement if it arises from something other than the express
language of the publication.
21. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, refusing to expend the time and effort to read, watch, and
understand all of the material isn the website link furnished by Plaintiff’s original
petition. A single topical pass through all of the material takes Defendant two and a
half business days, and of course Defendant is very familiar with the material and the
many technical issues presented in it. The Court is neither of those latter two things. As
you would expect from a pro se defendant going through a lawsuit like this for the first
time ever, Defendant kept himself aware of the Court’s activities and is aware the Court
spent very little time on this case. Any representation by Judge Caroline E. Baker that
she gave anything more than lip service to the evidence or to Defendant’s extensive
filings in this case is an outright lie.
22. With sloth or malice aforethought and singly or as part of a greater conspiracy in
collusion with Plaintiff Riddhi Desai, refusing to educate herself on the law in a case
that involved relatively new legislation in which she had just one prior experience, and
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in that one case had been reversed on appeal. In that case she had shown an egregious
disrespect for the Anti-S.L.A.P.P. law, for the legislators, for the voters, and for the
general public – the Anti-S.L.A.P.P. law is expressly intended to expedite defamation
cases, and so as a fundamental element contains several very specific, easily understood
time limits. Judge Caroline E. Baker did not even bother to read this important new
piece of legislation in that prior case, rendering her decisions a full seventy-two days
after filing, rather than the thirty days the law clearly requires.
23. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, deliberating scheduling a hearing requiring Defendant’s
presence on the very day that she knew or should have known that Defendant’s appeal
is due in the Fourteenth District Court of Appeals as a means to further erode the time
and effort Defendant can Devote to that appeal;
24. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, scheduling other hearings requiring Defendant’s presence
during the expedited period of time she knew or should have known is assigned to
preparing Anti-S.L.A.P.P appeals as a means to further erode the time and effort
Defendant can devote to that appeal;
25. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, allowing the filing and hearing of motions in the case when she
knew or should have known that the very intent and purpose of the Anti-S.L.A.P.P.
motion and its appeal process is to prevent such harassment and abuse of the legal
process;
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26. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, mocking Defendant’s good-faith efforts as a pro se litigant by
responding to 2200 web pages of materials and 84 pages of Defendant’s original
response with just a two-sentence decision containing not a single finding of fact or
conclusion of law, leaving Defendant to have to deal with every possibility in the
universe with respect to his appeal; and
27. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, using her Courtroom to pervert the process into a popularity
contest and war of attrition - knowing the party she disfavors is indigent with a small
child and cannot survive such a war - instead of a search for truth and justice. This will
be news to any society matron born with a silver spoon in her mouth, but the fact that
Judge Caroline E. Baker doesn’t personally like Defendant, or that she shares Plaintiffs
gender bigotry or distaste for men who have custody of their children over the mothers,
or that she disagrees with the contents of defendant’s website is supposed to be totally
irrelevant to these proceedings. To show how far gone Judge Caroline E. Baker is, she
doesn’t grasp that it’s not even relevant at this point whether she considers the website
defamatory – none whatsoever, for several reasons. If the Plaintiffs’ statutes of
limitations have run (they have), the suit can’t be heard regardless of the website’s
contents. If three judges on four occasions over seven years have heard the request to
take the websites down and refused (they have), there’s no merit to the suit regardless
of the website’s contents. If the Plaintiffs have unclean hands (they do), there’s no merit
to the suit. If the Plaintiffs failed to meet the terms of the Defamation Mitigation act
(they did), it’s over. Period. Period. Period.
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28. With malice aforethought and singly or as part of a greater conspiracy in collusion with
Plaintiff Riddhi Desai, Judge Caroline E. Baker ruled on behalf of Plaintiffs based on
personal preferences, shared gender, common membership in the Texas Bar
Association, and a common experience as female lawyers alone, with no regards
whatsoever for the facts of the matter. The record shows that Riddhi Desai did not make
a single argument of merit with regard to her burdens under the Texas Citizen
Participation Act, spending her time on arguing the details of the evidence instead of
making a case against Defendant’s overwhelming defenses. No honest judge, absent
the relationships and common interests shared by Judge Caroline E. Baker with Riddhi
Desai, would ever have denied the motion to dismiss on the evidence that was present.
Riddhi Desai was awarded the decision solely on Judge Caroline E. Baker’s personal
biases, provable by the sheer volume of arguments Riddhi Desai never made didn’t
make (in any public, legally permissible setting, anyway):
a. Defendant’s burden as to “communications” – stipulated to, since it’s part of
Plaintiffs submission and is a website, by definition a “communication;
b. Matter of public concern – stipulated to, since the Plaintiff’s own “letter” is
addressed to one public official and copied to another by that official
c. Res judicata – no denial, no argument;
d. Defense Mitigation Act – no denial, no argument;
e. Statute of limitations – denial, no relevant offerings (claimed “letters”, but the
only letters in evidence were protected communications government official
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and not probative because they were incomplete, and had no mention of the
website.
f. Laches – no denial, no argument;
g. Unclean hands – no denial, no argument
… and so on and so on.
II.
MITIGATING CIRCUMSTANCES
In conjunction with any investigative agency’s consideration for the aforementioned
bad acts, Defendant respectfully requests the additional consideration of the following
mitigating circumstances:
1. In private conversations, Judge Caroline E. Baker has expressed deep abiding
disrespect tantamount to hatred for pro se defendants;
2. Judge Caroline E. Baker is motivated as she approaches her stand for re-election
not to offend her fellow lawyers and members of the private club known as the
Texas Bar Association, who fund her campaign and espouse her candidacy and
with whom she must work every day, by ruling in favor of an indigent pro-se
defendant she’ll never see again;
3. In fifty-nine years of living and further in the last eight-plus years of Family Law
Court proceedings and as many as one hundred other court appearances
associated with his work, prior divorces, bankruptcy court, and U.S. Patent Office
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proceedings, Defendant has never been missed a hearing, been sanctioned, or
otherwise been accused of any impropriety or disrespect towards any Court;
4. In roughly the same period of time as defined above, and as a professional
politician and lawyer, Judge Caroline E. Baker has told thousands of untruths,
most often for profit or power, in hundreds of situations. While our society holds
its noses and tolerates professional liars as trial lawyers because it is the only
means we have to provide a defense for the guilty, great diligence is required to
restrain the dishonesty to the appropriate arena and to minimize it whenever and
wherever possible. In this case, Judge Caroline E. Baker has allowed her new-
found friend and probable contributor Riddhi Desai to lie to any extent she desire
in whichever role she wishes, lawyer, litigant or witness;
5. While Defendant has served his country honorably in many ways for many years
for either no compensation or for little more than his meals, Judge Caroline E.
Baker has never served until and unless there was profit or power received to her
benefit;
6. That Plaintiff Riddhi Desai and Plaintiff Shilpi Desai are wealthy Sugar Land
residents with an expensive home and millions in hidden assets;
7. That Plaintiff Riddhi Desai and Plaintiff Shilpi Desai are members of a large,
wealthy community in Sugar Land sharing a common experience in their birth
country of East India, and experience which includes both and an expectation of,
and acceptance of, graft among public officials;
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8. That Defendant and Defendant’s daughter are indigent, and powerless, and
therefore have nothing to offer Judge Caroline E. Baker anything she would
consider as having value when compared to what Plaintiffs can offer;
9. That Defendant and others have captured information regarding Plaintiffs illegal
and unethical activities on several websites, one of which is the subject of the
defamation suit filed by Plaintiffs;
10. That Judge Caroline E. Baker must stand for re-election on November 2;
11. That in 2008 Judge Caroline E. Baker was rejected by the voters in a close
election in which campaign funding was an important element;
12. That as a direct slap in the face to the voter’s wishes after being rejected in 2008,
Judge Caroline E. Baker resorted to trading political favors to acquire an
equivalent judicial position via the political manipulations of Governor Rick
Perry, who wanted to stick a Republican Judge in Democrat Bill White’s back
yard, and to appear in support of promoting women after a national
embarrassment on the political where he was pilloried for trying to use state
resources to force girls to get injections from his pharmaceutical company
supporter;
13. In accepting an in-your-face political appointment outside the voters’ wishes from
a political hack currently under indictment, charged with two felonies stemming
also from disrespect for the voters’ wishes, Judge Caroline E. Baker has signaled
that her ambitions trump all other considerations;
14. That after learning of Judge Caroline E. Baker’s disrespect for voters and being
repulsed by the sleaziness of it, and in accordance with being a registered voter
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
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and wishing to have his rightful say in the upcoming election, Defendant
registered a website under the name “http://www.JudgeCarolineBaker295.com”
and posted information on that website about the Judge’s inadequacies and
Defendant’s fears as to the damage the Judge’s poor character could do to his and
his daughter’s fragile financial status, security, family relationship;
15. Defendant was a direct witness to and investigator of, and Defendant and
Defendant’s daughter have been victims of, felonious acts committed by Plaintiff
Shilpi Desai on behalf of her mother, attorney Plaintiff Riddhi Desai, and has both
a duty and a right beyond the simple protections of free speech to express and
report that information to anyone he chooses for the legitimate purpose of
correcting, mitigating, or warning of those offenses.
II.
REMARKS
The foregoing statements are accusations of criminal and unethical behaviors by Judge
Caroline E. Baker in intentional and malicious violation of Defendant’s and Defendant’s
daughters’ fundamental civil rights, including the right to due process, the right to equal access
and the right to free speech unencumbered by prior restraint. Defendant requests the immediate
investigation of all of these complaints, including the felonies described in the website
underlying Plaintiffs’ original petition by the Texas Rangers. If this Court does not make a good-
faith effort to have all of these matters investigated promptly, impartially, and thoroughly,
defendant reserves the right to request assistance of Federal law enforcement agencies and the
Federal Courts, in view of the fact that Defendant and Defendant’s daughter have been denied
due process for more than seven years with respect to their attempts to have the identity theft and
Social Security numbers investigated and prosecuted.
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III.
PRAYER
Defendant prays that Judge Caroline E. Baker be immediately recused from this case, that
Plaintiffs be immediately sanctioned for their latest instance of Social Security and identity abuse
using the Harris County District Clerk’s public databases, that Defendant’s daughter’s Social
Security number and Defendant’s drivers license number be removed from public view, that
Defendant’s view of case documents in the Harris County District Clerk’s public databases be
fully restored so he can research his appeal, that the in-absentia kangaroo court orders rendered
by Judge Caroline E. Baker be immediately vacated, that any that Defendant be allowed to
pursue his appeal through its conclusion unmolested, and that Defendant be returned the same
right to fully participate in the legal process as anyone else anywhere in the country who does
not have to endure the duress and oppression of having their, and their family’s, identities abused
in any manner whatsoever.
Respectfully submitted,
_______________________________________
Frederic Scott Deaver
15919 Wingdale Drive
Houston, Texas 77082-1439
(832) 889-5089
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CAUSE NO. 2014-18950
RIDDHI DESAI § IN THE DISTRICT COURT OF
SHILPI PANKAJ DESAI, §
Plaintiffs §
§ HARRIS COUNTY, TEXAS
-V- §
§
FREDERIC SCOTT DEAVER § 295th JUDICIAL DISTRICT
Defendant §
MOTION FOR SANCTIONS
TO THE HONORABLE DISTRICT COURT JUDGE:
NOW COMES Defendant, Frederic Scott Deaver, and respectfully requests that the Court
render sanctions against Plaintiffs for their continuing and egregious violations of Defendant’s
and Defendant’s daughter’s rights to protection of their privacy – a matter at the very heart of
Defendant’s counterclaims, with specific attention and consideration given to Plaintiff’s
violation of Rule 21c. of the Texas Supreme Court’s “ORDER ADOPTING TEXAS RULE OF
CIVIL PROCEDURE 21c AND AMENDMENTS TO TEXAS RULES OF CIVIL
PROCEDURE 4, 21, 21a, 45, 57, AND 502; TEXAS RULES OF APPELLATE PROCEDURE
6, 9, AND 48; AND THE SUPREME COURT ORDER DIRECTING THE FORM OF THE
APPELLATE RECORD”, which reads in part:
“RULE 21c. PRIVACY PROTECTION FOR FILED DOCUMENTS.
“(a) Sensitive Data Defined. Sensitive data consists of:
“(1) a driver’s license number, passport number, social security number, tax
identification number, or similar government-issued personal identification number;
“(2) a bank account number, credit card number, or other financial account number;
and
“(3) a birth date, home address, and the name of any person who was a minor when the
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underlying suit was filed.
“(b) Filing of Documents Containing Sensitive Data Prohibited. Unless the inclusion of
sensitive data is specifically required by a statute, court rule, or administrative regulation, an
electronic or paper document, except for wills and documents filed under seal, containing
sensitive data may not be filed with a court unless the sensitive data is redacted.
“(c) Redaction of Sensitive Data; Retention Requirement. Sensitive data must be redacted by
using the letter “X” in place of each omitted digit or character or by removing the sensitive data
in a manner indicating that the data has been redacted. The filing party must retain an
unredacted version of the filed document during the pendency of the case and any related
appellate proceedings filed within six months of the date the judgment is signed.
“(d) Notice to Clerk. If a document must contain sensitive data, the filing party must notify
the clerk by:
(1) designating the document as containing sensitive data when the document
is electronically filed; or
(2) if the document is not electronically filed, by including, on the upper left-
hand side of the first page, the phrase: “NOTICE: THIS DOCUMENT
CONTAINS SENSITIVE DATA.”
“(e) Non-Conforming Documents. The clerk may not refuse to file a document that contains
sensitive data in violation of this rule. But the clerk may identify the error to be corrected and
state a deadline for the party to resubmit a redacted, substitute document.
6Tx. Supreme Court Misc. Dkt. No. 13-9165 Court of Criminal Appeals Misc. Dkt. No. 13-003
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“(f) Restriction on Remote Access. Documents that contain sensitive data in violation of this
rule must not be posted on the Internet.
“Comment to 2013 Change: Rule 21c is added to provide privacy protection for documents filed
in civil cases.
[End of quoted sections.]
I.
BACKGROUND
At 10:12 a.m. on August 4, 2014, while Defendant and Defendant’s daughter were
seating in the gallery awaiting the start of the Court’s session which began at 11:00 a.m. the
same day to address Defendant’s Anti-S.L.A.P.P. Motion to Dismiss, Plaintiff Riddhi Desai
hand-delivered to Defendant a brown manila envelope containing a partial copy of Plaintiffs’
amended original petition and one copy each of her and fellow Plaintiff Shilpi Desai’s responses
to Defendant’s Anti-S.L.A.P.P. Motion to Dismiss. As was Plaintiff’s full intention demonstrated
by the timing and manner of her delivery, Defendant did not have the means or the time to
review the partial copy of Plaintiffs’ amended original petition prior to the hearing just 48
minutes hence, focusing instead on the matter at hand which was Defendant’s Anti-S.L.A.P.P.
Motion to Dismiss.
At some point later in the day, Defendant reviewed the partial paper copy of the
Plaintiffs’ amended original petition. What Defendant could not know was that the paper copy
had been intentionally delivered to him incomplete, having nothing else to reference the
document to. However, on Thursday Defendant received a call from an attorney who is
monitoring the situation on Defendant’s behalf in an unofficial capacity, and during that phone
call was advised that Plaintiff Riddhi Desai and Plaintiff Shilpi Desai were again electronically
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distributing both Defendant’s and Defendant’s daughter’s private identifying information. They
had included an “EXHIBIT C” document, which is not included in the copy given Defendant
(which remains stapled and in exactly the same form it was presented to him), as an image in the
electronic version of the Plaintiffs’ amended original petition that they submitted electronically
to the Harris County District Clerk where it appears on a public section of the website accessible
to anyone willing to create an account (no bar card, government employment, or other
restrictions apply). They had inserted an un-redacted page 2 of the original divorce decree from
Fort Bend County rendered December, 2007 into what was an otherwise-redacted copy of the
decree, exposing Defendant’s daughter’s full Social Security number, name, and birth date on
page two, and Defendant’s full driver’s license number on page 24. The document itself, a
marked-up unofficial copy of a divorce decree never in Defendant’s possession, has no probative
value in that it is a public record easily attainable as such in its proper redacted form for any
official purposes. The divorce decree itself is not at issue in this case, other than perhaps as
evidence that Defendant was able to achieve his goals in that case against Plaintiffs’ incompetent
efforts, which serves Plaintiffs no good purpose.
III.
REMARKS
Without an extraordinary effort by the Court to resolve this issue, Defendant cannot
receive due process from this Court irrespective of the Court’s best intentions, a fault not of the
Court but of Plaintiffs and their unconstrained behaviors, which seem to be extending the
mockery with which they’ve always approached Defendant to include the Court and its
infrastructure. Defendant may be a layperson, but he can read and recognize circular logic, and it
looks for all the world to him as though Plaintiffs’ latest version of their original petition is
trying to construe the Defendant’s Anti-S.L.A.P.P. motion, and Defendant’s original answer and
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counterclaims as the basis for their original petition – a basis which didn’t exist at the time they
filed their original petition and which wouldn’t exist at all weren’t it not for Defendant having
been frivolously sued and having been legally required to respond. Defendant’s understanding
was and remains that he has been involuntarily engaged in a serious matter of law to be heard by
grown adults before a distinguished and respected jurist and a jury of his peers, and Defendant
lacks the resources to instead play Plaintiff’s pre-teen roll-your-own video game where the
opponent employs service addresses she knows to be invalid, where the last-minute hand-
delivered service of responses right before trial is meant to distract an inexperienced presenter,
where three-card-monte is played with exhibits so that Plaintiffs can use those exhibits to
continue their identity abuse of Defendant and his Daughter, where Plaintiff includes in an
unrelated filing irrelevant material about a Judge rightfully being recused eight years ago in
hopes of antagonizing the Court against Defendant in this case, and where Plaintiffs seem to be
expecting all of the tolerance that is extended to pro se defendants on top of all the benefits that
go with having been an attorney for 26 years. Defendant was raised to believe that this kind of
incessant cheating by one’s opponent is nothing less than their admission they couldn’t win
playing fair. The issue is not so much all this smoke Plaintiffs keep generating to hold off as
long as possible answering to the crimes they’ve committed, it is the harm that is caused to
Defendant’s daughter in the meantime as the identity theft continues.
II.
PRAYER
Given the history of this case as it includes the preceding Family Law Court case, given
the identical nature of the allegations against Plaintiffs as compared to these most recent
behaviors, given the seven years over which Plaintiffs have engaged in identity theft and Internet
bullying against Defendant and his daughter, given that Plaintiffs went to unusual lengths to be
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deceitful to the Defendant and to the Court in concealing their exposure of identifying
information in this latest instance, and given that Defendant has done everything in his power to
inform the Court of the onerous burden and duress that the threat of continued identity theft,
Internet bullying, and electronic intimidation by Plaintiffs places upon Defendant, Defendant’s
daughter, and upon Defendant’s witnesses and his continuing search for adequate counsel,
Defendant respectfully requests that the Court exercise every sanction available to it against
Plaintiffs in this matter, and to the extent possible, prevent further abuses of Defendant’s,
Defendant’s daughter’s, Defendant’s witnesses’ and Defendant’s potential counsel’s basic
identity rights. Defendant should have the same right to fully participate in the legal process as
anyone else anywhere in the country who does not have to endure the duress and oppression of
having their, and their family’s, identities abused in any manner whatsoever.
Respectfully submitted,
_______________________________________
Frederic Scott Deaver
15919 Wingdale Drive
Houston, Texas 77082-1439
(832) 889-5089
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15919 Wingdale Drive
Houston, Texas 77082-1439
May 24, 2014
The Honorable Caroline E. Baker
Harris County District Court 295
or
Chris Daniel, Harris County District Clerk
c/o Civil Courthouse
201 Caroline
Houston, Texas 77002
RE: Disability accommodations
To whom it may concern:
My name is Scott Deaver, and I have just been served with a civil lawsuit (the document I was served is
labeled “2014-18950 / Court: 295”) in Harris County District Court #295 on May 21, 2014. I have never
been sued before by anyone, and my only experience with these matters is in Family Law Court – I did
appear before Judge David Farr in the 312th Family Law Court in 2012, where I was awarded primary
custody of my seven-year-old daughter, Sophia Cindy Deaver, in August of that year. My daughter and I
have some special circumstances, and we need the Court’s assistance.
The woman and her daughter suing me are Riddhi Desai and Shilpi Desai, the attorney and her daughter,
respectively, who along with their tag-team co-counsel Jennifer Reynolds, lost every hearing of the six
that were held related to Sophia’s custody (three in Fort Bend County 328th District Court, and three in
Judge Farr’s court). After they lost the first three hearings by December, 2007, Shilpi Desai took my
daughter’s and my personal identity information, including our social security numbers, drivers’ license
numbers, and debit and credit account numbers, out of the case files entrusted to Riddhi Desai, and
began using that information to destroy our credit, sending it out to every hacker and scammer she
could find on the Internet, buying merchandise in our name, even applying for car loans in our name (a
private Internet investigator discovered in 2011 that she’d been using between six and eight Social
Security numbers belonging to other people for her online transactions, which is a felony) using her
work computer at Fluor Daniel Corporation in Sugar Land.
We have lost everything – at the time Shilpi Desai began the identity theft, we were in a Chapter 7
bankruptcy proceeding which was intended to protect our personal assets from the results of Microsoft
stealing from my business an invention (including the registered trademark name) called “Caller ID for E-
mail” for which I had applied for two patents (see
http://www.internetnews.com/security/article.php/3393891). I am not a businessperson, and had been
operating the business out of my home as a DBA called “FailSafe Designs” without incorporating, so the
Chapter 7 bankruptcy was for the purpose of disentangling my personal property from the business.
With the identity theft and everything that caused, including a counterfeit cashier’s check received from
an Internet scam artist for the emergency sale of my MG Midget, the hacking of my Chase and Capital
One savings and checking accounts, the loss of Sophia’s and my home, and having to take less well-
paying work because my credit scores began falling like a rock, I had to convert the bankruptcy to a
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Chapter 13 before I was yet able to realize the full impact of Shilpi Desai’s identity theft, which meant
that I did not receive the full protections of Chapter 13 bankruptcy that were intended by the law. One
of the things that happened was that we protected our home from creditors other than the mortgage
holder, as is allowed by Texas law, but we had no defenses when a counterfeit cashier’s check received
in payment for a car I sold bounced – a direct result of plaintiffs distributing our personal information to
scam artists on the Internet - and caused the checks we wrote in payment of the annual taxes on that
property to bounce.
The damage from the Desai’s identity theft continues to this day, and so I am forced to go pro se to
defend myself in this lawsuit. I understand I have a relatively short time to respond, and I do not have
the funds to hire an attorney. I do not know how I am going to afford all of the fees of a lawsuit. I
understand that now the Supreme Court requires electronic filing of documents, and I have no clue how
to go about that. But the biggest challenge I face is that Riddhi Desai and Shilpi Desai waited seven years
to file their lawsuit, I presume to allow their identity theft to achieve its maximum effect, and of course
in that time I have lost contact with witnesses and evidence as the identity theft has forced my daughter
and me to move several times. The website listed in their suit is one I mounted to try to obtain a lawyer
to sue them before I was served with their suit, so their suit represents an attempt to box me out of any
due process whatsoever.
That is the background against which I am making this request to accommodate some special
circumstances Sophia and I have. With the distractions that go with being a single custodial parent with
being a single custodial parent with no money for child care, and with trying to find employment and a
lawyer and money to live on, we were facing enough challenges as it was. Now on top of that, I’ve got to
go to court with no legal experience, no staff, and no time. In addition to that, I will be the only male
among the principals in the courtroom, and to make it worse, I will be the only male in the courtroom
who was granted custody of a small child over the mother (traditionally in Texas, the woman’s sphere of
control), I will be the only non-lawyer (and non-member of the Texas Bar Association) in the courtroom,
I will be the only indigent person in the courtroom, I will be the only person in the courtroom who
actually produces things to make my living, and I will be the only person babysitting an eight-year-old
while trying to present my case in the courtroom. I will be facing an opponent who is all about money
and power, and I’ll be facing a Judge who must stand for election in a few months and needs both
money and influence from lawyers to fund her campaign (no reflection on the Judge, just one of the
many unfair realities of being forced to go pro se in a state where Judges run for election). We’re not as
much concerned about the integrity of the Judge per se – it is more that plaintiffs are greedy and
manipulative, and will exploit every nuance or slightest opportunity to remind the Judge of his dilemma.
Proof of that kind of dirty behavior is clearly shown in the history of the Family Law Court proceedings.
In the very beginning of that case, a corrupt judge by the name of Ronald R. Pope was recused from our
case after an investigation by the Texas Rangers. He had enlisted his wife to file a false police report
against me using a description from a downloaded copy of my resume on the Internet in retaliation for
fliers I had posted (under permit from the City of Sugar Land) regarding gender bigotry in his court. Of
course, I have no criminal history of any kind (one of many reasons resulting in my eventually being
awarded primary custody of Sophia). Sophia’s first custody hearing was to have been heard before
Judge Pope shortly thereafter, and it was Judge Pope’s intention to use the manufactured assault charge
as a pretext to not only throw the book at me in retaliation for my political leanings, but take my
daughter from me as well.
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Since then, at every chance she can, Riddhi Desai brings up Judge Pope’s recusal to the presiding Judge –
the idea is to inflame the new Judge and create an impression that somehow we are a threat to that
Judge’s authority (we are no threat to anyone - we are the most open, transparent, and apolitical people
you’ll ever meet, and frankly we detest all of these various manipulations that plaintiffs engage in to
keep the attention away from their original and continuing identity thefts). To their credit, none of the
Judges who have heard our case have bit, but they were all males less inclined to place weight on
emotion. We are concerned about gender inequality playing a role in a case before a female judge
because I will be the only male in the courtroom, and we have seen instances in other courtrooms
where one man’s ”courage” becomes another woman’s “aggressive behaviors”.
On top of all of this, my daughter and I remain at extreme danger of further harm from Plaintiffs’
continuing identity theft, not just from the thefts of the past seven years, but from new thefts that will
occur from new information we will need to submit to satisfy the Court’s needs. I am all three of a
witness to plaintiffs’ crimes, an expert investigator of those crimes (I’ve been awarded numerous
patents as a result of techniques I’ve developed for this case to monitor computers to detect criminal
and other activity), and the victim of those crimes who has lived seven years under extreme duress of
the natural results of them. The Court is now asking me (and my witnesses, who are terrified that
plaintiffs will do the same to them, having seen the effects for themselves upon my innocent daughter
and me – I would presume this extends to members of the jury as well, so I don’t know whether it is
wise to ask for a jury or not) to pretend all of the foregoing didn’t happen and isn’t in full force and
effect and to hand over all of the bullets plaintiffs need to re-load their gun, with the empty promise
that the Court can somehow (no means offered) protect us from that which they couldn’t protect us
from before.
I do not know what, if anything, this Court can or will do about any of the above. Given the innate bias
inherent in the situation of an indigent pro se defendant having to face a lawyer of 26 years’ experience
who committed the very crimes that made the defendant both pro se and indigent, and given that the
Judge hearing the case belongs to the same private club as does the plaintiff (the Texas Bar Association),
and given the Judge is financially dependent upon lawyers to raise money for re-election (as I
understand it, this Judge has already lost one election, and is very aware of the need for adequate
campaign financing) and needs the support of lawyers much more than he needs the support of an
indigent pro se defendant, you’d think there’d either be a special court for this kind of case, or there
would be court-appointed attorneys for the pro se defendant to correct the imbalance.
But this request is to address another set of challenges on top of those. I am 59 years old, and am
beginning to suffer the physical informalities that go with increasing age, amplified no doubt by seven
years of intense stress intentionally caused by Riddhi and Shilpi Desai. In 2011 I was diagnosed with forty
percent hearing loss in my right ear and a lesser loss of hearing in my left, and for the past several years I
have suffered from short-term memory loss that seems to be gradually increasing. I have been admitted
into the Medicaid program, but receive no help with deductibles for medications and certain tests (we
literally do not have two nickels to rub together, and currently are borrowing money from my parents to
survive – they are on fixed Social Security incomes and are nearly ninety years of age). Though not
related to this request, as an illustration of the severity of the problem, I was diagnosed in 2012 with
carpal tunnel syndrome in both wrists and a rotator cuff injury in my right shoulder from an assault by
plaintiff’s client during the Family Law case (yet here I sit, forced by plaintiffs to type a response to their
harassing lawsuit without wrist braces I can’t afford). I cannot afford the deductibles for either the
medication or the therapy required to prepare for the surgery (I was supposed to get a colonoscopy at
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the same time, but was going to be charged a $64 deductible for a solution called MoviPrep to prepare
for surgery, and so had to miss the procedure).
Both Riddhi Desai and her tag-team co-counsel Jennifer Reynolds were born in other countries (East
India and mainland China, respectively, and have very heavy accents.
So, for all of these reasons, I need a pocket recording of the testimony at trial each day to review in the
evening after testimony once my daughter has been put to bed, to see what I may have missed and to
prepare for the next day’s session. When in Fort Bend County, we had Douglas “Woody” Lyons as our
attorney, a very professional lawyer with a full staff. We also hadn’t yet suffered the effects of plaintiffs’
later identity theft, so we were able to afford to pay $1500.00 for a transcript, and that matter didn’t
involve the possibility of an expedited appeal, so waiting three months for the court reporter to
transcribe the testimony in her private time wasn’t so much of an issue.
I’m trying to learn how to fight this latest lawsuit – I have only a few days to prepare a response, and I
am working to do that. There is a new law I’ve been reading about on the Internet entitled the “Texas
Citizen’s Participation Act” and it seems to fit what we need to do. However, it is in the form of a motion
to dismiss, and it doesn’t seem to me that will satisfy our need to file a formal answer to the original
petition. I think I will file a formal answer first so we meet the time limits, and then file the TCPA motion.
If we file the TCPA motion to dismiss, we should have no problem winning since the plaintiffs waited
seven years to file just to harass us and weaken our resources in the meantime with the effects of their
identity theft. But, as noted above, the deck is stacked against us in terms of us being different in many
ways from the Judge and the plaintiffs, so in the event of a catastrophe we would need to appeal.
Therein lies the problem, because the TCPA is all about expediting everything, including the appeals. We
know from past experience it takes months to get transcripts from the court reporters, and those
transcripts are incredibly expensive for a man and his daughter who have to scrounge quarters from her
piggy bank to buy toilet paper. In the unlikely event we had to appeal, how would we present testimony
from the hearing to argue our appeal with no recording and no transcript?
When we first entered Judge Farr’s courtroom, we’d suffered four years of plaintiffs’ identity theft, so
the best attorney we could afford was a bad-check kiter named William Dane Bennett, who once came
to a morning meeting he’d scheduled, in the common area of his girlfriend’s downtown Houston condo
where he was crashing, hung over and with white powder still clinging to the hairs in his nostrils (he is a
much taller man than I, so it was hard to miss) from his wakeup toot. It was then that I wrote the court
for permission and began recording court proceedings, more as an expression of the need to protect
myself against my own attorney than anything else.
In Judge Farr’s courtroom, signs are clearly posted in several places that recording is not allowed
without contacting the bailiff. As soon as we were served with this latest suit, Sophia and I went to the
295th courtroom when we had to be downtown for something else, so that when we go to trial we will
know how to get there and what to expect, but there are no signs posted anywhere about recordings, or
cell phones, or anything, or who to contact about getting permission. I assume the signs are supposed to
represent the local rules mentioned in the website, and without them I’m not clear how we go about
talking to someone about what the rules this Judge expects us to follow. When we were in Judge Farr’s
court, we just wrote him a letter, and that seems to have worked out well. We were able to record with
our pocket recorder, and to use those recordings in a disciplinary hearing against Jennifer Reynolds,
resulting in a $250.00 fine for her misconduct.
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Ersatz, this letter. In our letter to Judge Farr when faced with this problem we quoted from the website
at http://www.dmlp.org/legal-guide/texas-recording-law as the basis for asking permission to record.
I’ve since found another website at http://www.dmlp.org/legal-guide/recording-police-officers-and-
public-officials that says a number of courts, including several Federal Appeals courts, have recognized a
First Amendment right to record public officials. But both articles seem to be suggesting that it’s better
to ask permission from the Court, and in an abundance of caution we are seeking that.
Please let us know if you have any issue with us recording testimony (audio only) for our use. We will
delete any recorded audio identified by the Judge as being off the record, and will of course follow any
rules set forth by either the District Clerk or the Judge. One of the things that has served us very well so
far throughout these past seven years despite all our disadvantages, and which sets us far apart from
plaintiffs, is that we are open and transparent and we follow the rules. That distinction is very important
to us, and we want to do encourage and maintain that trust.
Respectfully,
F. Scott Deaver
[email protected]
(832) 889-5089
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VERIFICATION
STATE OF TEXAS )
)
COUNTY OF HARRIS )
BEFORE ME, the undersigned authority, personally appeared Frederic Scott
Deaver, who, by me duly sworn, deposed and stated that he is the defendant in the above entitled
and numbered cause; that he has read the foregoing Defendant’s Second Amended Answer,
Counterclaims, Request for Disclosure, and Request for Modified Discovery Control Plan and
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 59
CERTIFICATE OF SERVICE
I certify that a true and correct copy of the foregoing pleading or document has been served upon
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 60
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 61
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 62
CERTIFICATE OF COMPLIANCE
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 63
VERIFICATION
STATE OF TEXAS
COUNTY OF HARRIS §
On this day, before me, the undersigned authority, personally appeared FREDERIC
SCOTT DEAVER, and after being duly sworn, deposed as follows:
“My name is FREDERIC SCOTT DEAVER. I am over the age of 18, of sound mind, and
in able condition to make this affidavit. I am the Defendant in the above-captioned cause of
action. I have personal and first-hand knowledge of the facts stated herein.
“I have read the foregoing Appellant’s Response to Appellees’ Motion for Rehearing, in
its entirety, and reviewed all attached exhibits. I certify the facts stated in the notice are true and
correct to the best of my knowledge. I further certify the Exhibits attached to the notice are true
and correct copies of the originals.”
FURTHER AFFIANT SAYETH NOT.
By his signature affixed below in the presence of the undersigned authority, affiant swears
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 64
CERTIFICATE OF SERVICE
Appeal Number 14-14-00683-CV, APPELLANT’S RESPONSE TO APPELLEES’ MOTION FOR
REHEARING - Page 65
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NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-4630-16T4
STATE OF NEW JERSEY,
Plaintiff-Respondent,
v.
SOLOMAN D. NEAL, a/k/a
SOLOMON NEAL, and KARIM SMITH,
Defendant-Appellant.
Submitted May 31, 2018 – Decided July 20, 2018
Before Judges Alvarez and Currier.
On appeal from Superior Court of New Jersey,
Law Division, Essex County, Indictment No. 15-
06-1269.
Joseph E. Krakora, Public Defender, attorney
for appellant (Stephen P. Hunter, Assistant
Deputy Public Defender, of counsel and on the
brief).
Robert D. Laurino, Acting Essex County
Prosecutor, attorney for respondent (Matthew
E. Hanley, Special Deputy Attorney
General/Acting Assistant Prosecutor, of
counsel and on the brief).
PER CURIAM
Defendant Solomon D. Neal entered a guilty plea to an amended
charge of third-degree aggravated assault, N.J.S.A. 2C:12-1(b)(2),
after a Law Division judge denied his motion to suppress an out-
of-court identification. In accord with the plea agreement, the
judge sentenced defendant to fifteen months of probation in
addition to fines and penalties on April 28, 2017. Defendant
appeals, alleging that his motion to suppress should have been
granted because the out-of-court identification was impermissibly
suggestive. We affirm.
We summarize the circumstances as developed during the
suppression hearing. At around 2:00 p.m. on December 24, 2014,
Ajegbe Oyekunle, an apartment building manager, was making repairs
to the front door of the structure. Oyekunle was going back out
to his van to retrieve some construction materials when a car
abruptly stopped in front of it. The driver——who the victim
immediately recognized by name as the son of one of his tenants,
whom he had known for seven years——asked him "Why the f--- you
messin' with my father?"
Defendant driver and the passenger stepped out of the car;
the passenger held a knife. They punched and kicked Oyekunle in
the head and face; Oyekunle's cell phone and wallet fell out of
his pocket. Defendant picked up the items and threw the cell
phone at the victim. As Oyekunle approached defendant to retrieve
2 A-4630-16T4
his wallet, the passenger wielded the knife and Oyekunle retreated.
Defendant took cash from the wallet, and threw the wallet at
Oyekunle. Defendant and the passenger then drove away.
Oyekunle called 911 and told the dispatcher that he had just
been robbed and assaulted by Solomon Neal, the son of a tenant who
had recently been evicted. After police arrived at the scene,
Oyekunle was administered medical treatment, however, he did not
go to the station to make a statement until approximately 6:00
p.m. because he wanted to complete the work on the building.
During the video recorded interview at the police station,
Irvington Police Department Detective Philip Rucker showed the
victim two photographs of defendant, including his Division of
Motor Vehicle photo. Rucker testified that because the victim
knew his assailant, he did not create a photo array or otherwise
comply with the Attorney General guidelines found in State v.
Henderson, 208 N.J. 208 (2011). See R. 3:11; see also Office of
the Attorney Gen., N.J. Dep't of Law & Pub. Safety, Attorney Gen.
Guidelines for Preparing and Conducting Photo and Live Line-Up
Identification Procedures, 1 (2001). Rucker described the
identification procedure as a "show-up," during which he displayed
the photographs to the victim and asked if the victim knew the
person. He said that Oyekunle had explained defendant's father
had been a tenant over the course of years. Once Rucker obtained
3 A-4630-16T4
defendant's name from Oyekunle, Rucker requested defendant's
Division of Motor Vehicles photograph. Although the interview
took place several hours after the incident, Oyekunle was still
bleeding and wearing a bloody shirt.
The judge found that having observed the officer and the
victim during the suppression hearing, he "found their testimony
credible in all material respects." The judge concluded that the
officer's failure to adhere to the Henderson guidelines was
inconsequential. The victim had known defendant by name for many
years. Therefore, only showing the victim photographs of defendant
was not suggestive. Although he had granted defendant's motion
for a Wade hearing, defendant ultimately did not sustain his
burden. Accordingly, the judge did not suppress the
identification.
On appeal, defendant raises the following point:
THE MOTION TO SUPPRESS THE IDENTIFICATION
SHOULD HAVE BEEN GRANTED BECAUSE UNDER THE
TOTALITY OF THE CIRCUMSTANCES, THERE WAS A
SUBSTANTIAL LIKELIHOOD OF IRREPARABLE
MISIDENTIFICATION. U.S. Const. Amend. V, XIV;
N.J. Const. Art. I, ¶¶ 1, 9.
We accord "considerable weight" to a trial judge's findings
regarding the impermissible suggestiveness of an identification
procedure. State v. Adams, 194 N.J. 186, 203 (2008) (quoting
State v. Farrow, 61 N.J. 434, 451 (1972)). A defendant bears the
4 A-4630-16T4
"initial burden of showing some evidence of suggestiveness that
could lead to a mistaken identification." Henderson, 208 N.J. at
288. "The findings of the trial judge as to reliability of the
witnesses are [also] entitled to considerable weight." State v.
Wilson, 362 N.J. Super. 319, 327 (App. Div. 2003) (citations
omitted). The State may proffer an identification as long as
"there is sufficient credible evidence in the record to support
the findings." Adams, 194 N.J. at 203 (citation omitted).
In this case, defendant was well-known to the victim as he
had known him by name for years. During the 911 call, the victim
told police defendant was his attacker. Thus, the reliability of
Oyekunle's identification was not undermined by the fact he was
presented the two photographs of defendant. Having found the
victim believable, his familiarity with his attacker was
sufficient credible evidence for the court to hold the
identification was reliable. Defendant's argument lacks
sufficient merit to warrant discussion in a written opinion. See
R. 2:11-3(e)(2).
Affirmed.
5 A-4630-16T4
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621 F.Supp.2d 741 (2009)
UNITED STATES of America, Plaintiff,
v.
Harold George VOICE, Defendant.
No. CR. 08-30101-01-KES.
United States District Court, D. South Dakota, Central Division.
April 17, 2009.
*743 Jay P. Miller, U.S. Attorney's Office, Pierre, SD, Jeremy R. Jehangiri, U.S. Attorney's Office, Rapid City, SD, for Plaintiff.
Edward G. Albright, Federal Public Defender's Office, Pierre, SD, for Defendant.
ORDER ADOPTING REPORT AND RECOMMENDATION ON DEFENDANT'S MOTION TO DISMISS INDICTMENT
KAREN E. SCHREIER, Chief Judge.
Defendant, Harold George Voice, is charged with one court of failure to register as a sex offender in violation of 18 U.S.C. § 2250(a). Docket 1. Voice moves to dismiss the indictment filed against him based upon the fact that the Sexual Offender Registration Notification Act (SORNA) is unconstitutional in several respects.
The court referred the motion to dismiss the indictment to the magistrate judge pursuant to 28 U.S.C. § 636(b)(1)(B). The magistrate judge recommends that this court deny Voice's motion to dismiss the indictment in all respects. Voice objects to several legal conclusions in the magistrate judge's report and recommendation. *744 The government has not responded to Voice's objections.
STANDARD OF REVIEW
The court must make a de novo review "of those portions of the [Magistrate's] report or specified proposed findings or recommendations to which objection is made." 28 U.S.C. § 636(b)(1); see also United States v. Lothridge, 324 F.3d 599 (8th Cir.2003); Jones v. Pillow, 47 F.3d 251, 253 (8th Cir.1995). 28 U.S.C. § 636(b)(1) requires that when a party objects to the report and recommendation of a magistrate judge concerning a dispositive matter, "[a] judge of the court shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made." Id.; see also Fed.R.Civ.P. 72(b). After a de novo review of the magistrate judge's report and recommendation and a review of the record, the court adopts the report and recommendation as supplemented below.
DISCUSSION
I. Ex Post Facto Clause
The magistrate judge found that SORNA does not violate the Ex Post Facto clause of the United States Constitution.
A. Prospective Application
The magistrate judge found that SORNA works prospectively because it creates a new punishment for a new offense, which is failing to register as a sex offender after July 27, 2006. Voice objects to this finding, arguing that applying SORNA to him imposes punishment for an act that was not punishable at the time it was committed.
Voice is charged with failing to register between August 5, 2008, and October 2, 2008. This time period is after SORNA's effective date and after the Attorney General's regulations were promulgated clarifying SORNA's applicability to previously convicted sex offenders. Under similar circumstances, in United States v. May, 535 F.3d 912, 919 (8th Cir.2008), the Eighth Circuit determined that SORNA works prospectively and therefore does not violate the Ex Post Facto Clause. Pursuant to this precedent, the court finds that SORNA applies prospectively and does not violate the Ex Post Facto Clause.
B. Increased Punishment
The magistrate judge further determined that SORNA did not retroactively increase Voice's punishment. Voice objects to this finding, contending that SORNA imposes additional punishment to the punishment he received when he was initially convicted of the sex offense in 1998. Voice argues that at the time of his 1998 underlying conviction, he was subject to a Class I misdemeanor penalty for failure to register pursuant to the Jacob Wetterling Act. SORNA increases that penalty to a federal felony that carries up to ten years in prison. Voice urges that this difference in penalties distinguishes his case from the May case.
In May, the Eighth Circuit did not need to address whether SORNA would violate the Ex Post Facto Clause if it subjected a defendant to higher penalties than the statutory scheme in place at the time the defendant committed the initial sex offense, because as a repeat offender, May was already subject to a ten-year statutory maximum under the Lychen Act. Id. at 920, n. 4.
The Tenth Circuit in United States v. Hinckley, 550 F.3d 926, 936 (10th Cir. 2008), however, did reach this issue and found that SORNA does not violate the Ex Post Facto Clause. Defendant had argued *745 that the only laws in effect at the time of his offense were state statutes and the Jacob Wetterling Act, which carried lesser penalties than SORNA. In rejecting this argument, the Tenth Circuit adopted the rationale of May that SORNA is a civil retroactive registration scheme that relies on criminal penalties to further its civil intent and does not increase the punishment for acts committed prior to SORNA's effective date. Id. at 938. Therefore, based upon the Eighth Circuit's rationale in May and the Tenth Circuit's decision in Hinckley, the court finds that SORNA does not violate the Ex Post Facto Clause because it did not increase the punishment of Voice for acts committed prior to SORNA's effective date.
C. Civil, Non-Punitive Regulatory Scheme
The magistrate judge concluded that SORNA is a civil and non-punitive regulatory scheme. Voice objects to this finding, arguing that SORNA is a punitive statute based, in part, on the fact that it provides penalties for failure to comply with it. The Eighth Circuit has determined that SORNA is regulatory, not punitive, and as a result it does not violate the Ex Post Facto Clause. May, 535 F.3d at 919-920. Accordingly, Eighth Circuit precedent requires this court to find that SORNA is not punitive in nature and thus does not violate the Ex Post Facto Clause.
II. Due Process Clause
The magistrate judge also found that SORNA does not violate the Due Process Clause of the United States Constitution.
A. Implementation of SORNA
The magistrate judge determined that Voice could comply with SORNA even if the Crow Creek Sioux Tribe has not implemented SORNA. Voice objects to this finding, contending that the Attorney General guideline should not be applicable to the Crow Creek Sioux Tribe, which has no sex offender registry program in existence. Additionally, Voice argues that Crow Creek Sioux Tribe's failure to implement SORNA excuses his alleged illegal activity. In sum, Voice emphasizes that because the Crow Creek Sioux Tribe does not have a sex offender registration program, he could not register with the Crow Creek Sioux Tribe in compliance with SORNA. Voice also points out that South Dakota has not adopted SORNA.
The parties have not cited controlling authority that directly addresses this issue. But, as indicated in the magistrate judge's opinion, there is a plethora of recent persuasive authority indicating that the failure of a state to implement or update its registration in accordance with SORNA does not relieve the sex offender of his duty to register all information that is required by then existing state law. See, e.g., Hinckley, 550 F.3d at 939 (determining that the fact that Oklahoma had not statutorily implemented SORNA did not provide an excuse for the defendant not to register because the defendant had knowledge of his duty to register under similar state and federal provision); United States v. Shenandoah, 572 F.Supp.2d 566, 578 (M.D.Pa.2008) (stating that "[a] state's failure to update its registration system to conform with SORNA does not alter a sex offender's independent duty to register all information that is required by then-existing state law"); United States v. Contreras, 2008 WL 5272491, at *6 (W.D.Tex. Dec. 18, 2008) (stating that the court "rejects Defendant's argument that Texas's failure to implement SORNA gives rise to a due process violation"); United States v. Benton, 2008 WL 5273971, at *6 (S.D.Ohio Dec. 16, 2008) (recognizing that "courts addressing this *746 issue have overwhelmingly held that SORNA is effective and applicable prior to state implementation of SORNA requirements"); and United States v. Senogles, 570 F.Supp.2d 1134, 1157-58 (D.Minn. 2008) (rejecting the defendant's argument that because Minnesota has not implemented SORNA, prosecuting him for violating its registration requirements is a violation of the due process clause). As a result, it is irrelevant whether South Dakota has completely complied with the SORNA registry requirements. Sex offenders residing within the jurisdiction of South Dakota must register with the state.
Likewise, courts have also determined that even if an Indian tribe fails to implement a sexual offender registry pursuant to SORNA, a sex offender still has an independent duty to register with the state. See United States v. Begay, 2009 WL 465026, at *2 (D.Ariz. Feb. 24, 2009) (noting that case law indicates that SORNA imposes an obligation on the defendant to register regardless of whether the Navajo Nation has complied with SORNA's requirements) and United States v. Watchman, 2009 WL 464995, at *2 (D.Ariz. Feb. 24, 2009) (same). Those courts reasoned that Congress has authority to implement federal criminal statutes of general applicability on tribal lands and that Congress intended SORNA to apply to tribal lands because SORNA violations can occur if a defendant enters, leaves, or resides in "Indian country." Id. at *2. SORNA requires sex offenders to register "in each jurisdiction where the offender resides, where the offender is an employee, and where the offender is a student." Id. at *3. These courts construed the phrase "each jurisdiction where the offender resides" broadly, finding that it requires a sex offender not only to register on the reservation but also to register with the state in which the reservation is located. These courts broadly interpreted the phrase because "[t]o read the statute more narrowly would mean that offenders residing on or moving to reservations that had opted into SORNA but had not yet created a registration system would have no obligation to register." Id. at *4. Such a result would be inconsistent with Congress's intent that "SORNA ... reach all sex offenders in all parts of the United States and to prevent even temporary loss of offenders from the registration rolls." Id. at *3. As such, these courts concluded that a sex offender is required to register both on the reservation and with the state.
The court finds that the above-mentioned cases are persuasive and that the magistrate judge's reliance on the reasoning of those cases was appropriate. Accordingly, the court finds that despite the fact that the Crow Creek Sioux Tribe has no sex offender registry program, SORNA as applied to Voice does not violate the due process clause.
B. Notification of SORNA Registration Requirements
The magistrate judge found that because Voice previously complied with state requirements to register as a sex offender, he understood that responsibility and was able to fulfill that responsibility. The magistrate judge also noted that Voice acknowledged being notified in his July 7, 2008, registration form that he has a duty to advise law enforcement agencies of any change of address or relocation and that if he failed to do so he could be charged with a state offense. As a result, the magistrate judge concluded that Voice had at least constructive notice of his duty to register pursuant to SORNA and therefore SORNA as applied to him does not violate the Due Process Clause. The magistrate judge further noted that given Voice's knowledge of his existing state registration *747 requirements, his failure to register was the result of active, not "wholly passive," conduct. Voice objects to these findings, contending that any notice that Voice received to register under South Dakota state law does not diminish his due process claim. Voice contends that notice of South Dakota's requirements does not substitute for notice under SORNA, especially in light of the fact that the notice time-frame requirements, tiers, and penalties between the federal and state laws are different. Voice also argues that the Crow Creek Sioux reservation has no sex offender registry and therefore he was not provided notice of any obligation to register when entering the reservation.
In May, the Eighth Circuit determined that the defendant's argument that he was not notified about the SORNA registration requirement was based upon his alleged ignorance of the law. The court found that because the defendant knew he had an obligation to register and keep his registration current when moving between jurisdictions based upon previously enacted state laws, his due process rights were not violated. In reaching this conclusion, the court also relied on the fact that the defendant had received information regarding his state registration obligations. Id.
Here, Peggy Nickerson, the South Dakota sex offender compliance coordinator who maintains the sex offender registry, testified that Voice submitted a July 2008 state sex offender registration form. She explained that Voice re-registered with the Sioux Falls Police Department and the Sioux Falls Police Department subsequently sent the form to her office. She also clarified that the form only contained the state law requirements for registering as a sex offender and did not notify an individual of the registration requirements under SORNA. Docket 37 at 25-28. Further, the form signed by Voice indicates that he had been notified about his registration obligations and that he knew he had an obligation to register and keep his registration current, based upon South Dakota law.[1] Accordingly, based upon the reasoning employed in May, the court finds that SORNA does not violate Voice's due process rights even though he did not receive specific notice about his obligations to register or update his registration pursuant to SORNA.
Moreover, the magistrate judge recognized and the court agrees that an overwhelming majority of courts have determined that a defendant's knowledge of his or her obligation to register as a sex offender pursuant to state law is sufficient to satisfy the due process clause requirements in relation to SORNA. See, e.g., Hinckley, 550 F.3d at 938 (noting it agreed with "the majority of courts [that] have concluded that notice of a defendant's obligations under state law is sufficient to satisfy the Due Process Clause's requirements"); United States v. Gould, 526 F.Supp.2d 538, 544 (D.Md.2007) (stating that a defendant's "prior knowledge of a duty to register under state law qualified as effective notice under SORNA"); United States v. Kent, 2007 WL 2746773, at *1 (S.D.Ala. Sept. 20, 2007) (determining that "the defendant had sufficient notice that failing to register was illegal, in that defendant was counseled on at least two occasions of his duty to renew his registration *748 and to provide a change of address prior to moving"); and United States v. Mitchell, 2007 WL 2609784, at *2 (W.D.Ark. Sept. 6, 2007) (finding that because a defendant knew that he was under an obligation to register as a sex offender under state law, the defendant's lack of knowledge of the requirement to register as a sex offender under SORNA was unconvincing). As noted above, Voice had knowledge of his obligation to register as a sex offender under South Dakota law, which is demonstrated by his July 2008 state sex offender registration form. Therefore, because Voice knew the registration requirements South Dakota imposes on sex offenders, he is deemed to have sufficient notice regarding the registration requirements of SORNA.
C. Ambiguity of SORNA
The magistrate judge determined that the notification and verification provisions contained in SORNA are not ambiguous. The magistrate judge noted that Voice was advised that he was required to re-register and that he was to provide written notification of any change of address and relocation within five days of moving. Although the magistrate judge acknowledged that South Dakota requirements are not in complete accord with SORNA's requirements, he found that the advisements were unequivocal and left no room for confusion. Voice objects to these findings, arguing that SORNA is ambiguous in informing a person when he is required to appear in person and inform a jurisdiction of all changes required for the sex offender registry. Voice further points out that this issue is further confused when the individual is only made aware of having to register bi-annually under South Dakota law.
As the magistrate judge recognized, the provisions of SORNA that Voice argues are ambiguous apply to different situations and therefore, even though they may contain some inconsistencies, such inconsistencies do not make SORNA ambiguous. SORNA requires a sex offender to keep his registration current. Specifically, SORNA provides that
[a] sex offender shall, not later than 3 business days after each change of name, residence, employment, or student status, appear in person in at least 1 jurisdiction involved ... and inform that jurisdiction of all changes in the information required for that offender in the sex offender registry.
42 U.S.C. § 16913(c). It further provides the jurisdiction that is notified "shall immediately provide that information to all other jurisdictions in which the offender is required to register." Id. This provision of SORNA advises the sex offender about the steps he needs to take to update his registration when he changes his name, residence, employment, or student status. That is, a sex offender must appear in person in one jurisdiction involved with the change of his name, residence, employment, or student status within three days after completing such change. Accordingly, this provision of SORNA only applies if a sex offender changes his name, residence, employment, or student status.
SORNA also requires a sex offender to periodically appear in person for verification purposes. In this regard, SORNA states that
[a] sex offender shall appear in person, allow the jurisdiction to take a current photograph, and verify the information in each registry in which that offender is required to be registered not less frequently than
(1) each year, if the offender is a tier I sex offender;
(2) every 6 months, if the offender is a tier II sex offender; and
*749 (3) every 3 months, if the offender is a tier III sex offender.
42 U.S.C. § 16916. This provision of SORNA requires the sex offender to periodically appear in person to verify information, irrespective of whether he has changed his name, residence, employment, or student status. Therefore, unlike 42 U.S.C. § 16913(c), this provision applies to the sex offender all of the time, not just when the sex offender changes his name, residence, employment, or student status.
In sum, SORNA instructs a sex offender that if he changes his name, residence, employment, or student status, he must appear in one jurisdiction involved to notify the jurisdiction of these changes within three business days of the changes. SORNA further instructs a sex offender that even if he does not change his name, residence, employment, or student status, he must appear in the jurisdiction in which he lives to verify information either each year, every six months, or every three months, depending on his sex offender classification. As a result, these two SORNA provisions apply in different situations and do not make SORNA ambiguous.
Moreover, the fact that the South Dakota requirements are inconsistent with the SORNA requirements does not make SORNA ambiguous. When interpreting a statute, a court is to consider "whether the language at issue has a plain and unambiguous meaning with regard to the particular dispute in the case." Robinson v. Shell Oil Co., 519 U.S. 337, 340, 117 S.Ct. 843, 136 L.Ed.2d 808 (1997). If so, the court applies the plain language of the statute. See Doe v. Dept. of Veterans Affairs, 519 F.3d 456, 461 (8th Cir.2008). A court is to look beyond the statute's text only if it is ambiguous. See Staples v. United States, 511 U.S. 600, 605, 114 S.Ct. 1793, 128 L.Ed.2d 608 (1994). Here, as discussed above, the plain language of SORNA is not ambiguous. As such, the court is not to consider South Dakota law when determining whether SORNA is ambiguous. Accordingly, the court finds that the fact that South Dakota requirements may be inconsistent with SORNA requirements does not make SORNA ambiguous.
III. Non-Delegation Doctrine
The magistrate judge found that Voice lacks standing to argue that Congress violated the non-delegation doctrine by authorizing the Attorney General to determine SORNA's retroactivity. The magistrate judge further found that even if Voice did have standing to make such an argument, his argument would fail because every court that has considered this particular issue has held that this delegation of authority was not unlawful. Voice objects to these findings, arguing that Congress failed to articulate any policy to guide the Attorney General on the retroactivity of SORNA. Voice asserts that Congress gave the Attorney General the sole discretion to determine who should be subject to SORNA and that by doing so, Congress violated the non-delegation doctrine. Voice contends that if Congress intends any law to have retroactive effect, it must comply with the Constitution rather than explicitly handing a legislative function to an official in the executive branch.
The Eighth Circuit has determined that if a defendant was a person able to register before SORNA's enactment, thereby making SORNA's authorization of the Attorney General to promulgate rules inapplicable to him, that defendant did not have standing to challenge SORNA based upon the non-delegation doctrine. May, 535 F.3d at 920-21. Here, Voice was convicted of two counts of abusive sexual contact in violation of 18 U.S.C. § 2244(a)(1), in the United States District Court for the District of South Dakota, on November 12, *750 1998. Voice registered as a sex offender with the state of South Dakota and was required to register biannuallyin January and July. These facts indicate that Voice was able to register before SORNA's enactment. Thus, the court finds that Voice lacks standing to raise the question of the delegation of authority to the Attorney General.[2]
IV. Commerce Clause
The magistrate judge determined that SORNA, as applied to Voice, did not violate the Commerce Clause of the United States Constitution. The magistrate judge explained that Voice's claim is foreclosed by Eighth Circuit precedent. The magistrate judge further reasoned that because Voice was previously convicted of a federal sex offense in Indian country and traveled from Sioux Falls to the Crow Creek Sioux reservation, he has an interstate nexus which brings him within the scope of SORNA. Voice objects to these findings, arguing that the Eighth Circuit precedent with regard to SORNA and the Commerce Clause is distinguishable from this case. Voice also contends that his alleged illegal activity occurred only within the state of South Dakota and therefore Voice did not travel in interstate commerce.
The Eighth Circuit has determined that SORNA does not violate the commerce clause of the United States Constitution. See United States v. Howell, 552 F.3d 709, 713-17 (8th Cir.2009) and May, 535 F.3d at 921-22. Admittedly, these cases involve factual scenarios in which the defendants traveled from one state to another state. See Id. Here, Voice did not leave the state of South Dakota, but he did enter the Crow Creek Sioux Reservation. As such, those cases are instructive but not necessarily binding in relation to the particular issue that is presently before the court. Nevertheless, the court agrees with the magistrate judge's conclusion that SORNA does not violate the Commerce Clause.
The Commerce Clause grants Congress the power "[t]o regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes." U.S. Const. art. I, § 8, cl. 3. Congress's power under the Commerce Clause includes the power to regulate (1) "the use of the channels of interstate commerce"; (2) "the instrumentalities of interstate commerce, or persons or things in interstate commerce, even though the threat may come only from intrastate activities;" and (3) "those activities having a substantial relation to interstate commerce." United States v. Lopez, 514 U.S. 549, 558-59, 115 S.Ct. 1624, 131 L.Ed.2d 626 (1995). Under 18 U.S.C. § 2250(a), SORNA only applies to sex offenders who were convicted of a federal sex offense or who travel in interstate or foreign commerce or enter, leave, or reside in Indian country. Therefore, an individual who commits a state sex offense and does not leave the state of South Dakota is not subject to the registration requirements of SORNA. Significantly, Congress set out two jurisdictional prerequisites, one of which must be satisfied, in order for SORNA to apply and such prerequisites are consistent with the Commerce Clause. These prerequisitesthe commission of a federal sex offense or the traveling to a different state, a foreign country, or Indian *751 countryhave a significant enough connection with interstate commerce to bring SORNA within the purview of the Commerce Clause. Thus, SORNA does not violate the Commerce Clause.
For the reasons discussed, Voice's objections are overruled and the magistrate judge's Report and Recommendation is adopted. Accordingly, it is hereby
ORDERED that the magistrate judge's Report and Recommendation (Docket 35) is adopted as supplemented herein.
IT IS FURTHER ORDERED that the defendant's objections to the Report and Recommendation (Docket 42) are denied.
IT IS FURTHER ORDERED that the defendant's motion to dismiss (Docket 15) is denied.
REPORT AND RECOMMENDATION FOR DISPOSITION OF DEFENDANTS MOTION TO DISMISS INDICTMENT
MARK A. MORENO, United States Magistrate Judge.
Defendant, Harold George Voice ("Voice"), has filed a Motion to Dismiss Indictment and a Memorandum in support thereof. Plaintiff, United States of America ("Government"), has filed a Response to the dismissal Motion. Subsequently, an evidentiary hearing was held before this Court on Voice's Motion. Because the Motion is a dispositive one, the Court is only authorized to determine the same on a report and recommendation basis. Pursuant to 28 U.S.C. § 636(b)(1), the Court does now make and propose the following report and recommendation for disposition of the Motion.
I.
Voice is charged with one count of Failure to Register as a Sex Offender. The alleged violation is said to have occurred between August 5, 2008 and October 2, 2008, in this state and district. According to the Indictment, Voice is required to register, under the Sex Offender Registration and Notification Act ("SORNA") as a sex offender, by reason of a conviction under federal law, and he knowingly failed to register and update his registration, in violation of 18 U.S.C. § 2250(a).
II.
In the summer of 2008, Voice was residing in Sioux Falls, Minnehaha County, South Dakota and was under federal supervision. He had previously registered as a sex offender with the State of South Dakota, and was required to register bi-annually in January and July of each year under state law. He re-registered on July 7, 2008, and was required to next register in January, 2009.
On October 2, 2008, Voice was seen walking in the approximate vicinity of the BIA agency building in Fort Thompson, South Dakota, on the Crow Creek Indian Reservation, and was arrested on a federal warrant issued for alleged violations of his supervised release. Witnesses reported that Voice had been sleeping behind an abandoned bathhouse building approximately two tenths of a mile from the location where he had been stopped and arrested. Voice had not registered with or notified the appropriate law enforcement agency of his relocation.
On October 22, 2008, Voice was indicted and thereafter pled not guilty to the charge. He later filed a Motion to Dismiss the Indictment claiming that SORNA violates the Ex Post Facto, Due Process and Commerce Clauses of the United States Constitution and the Non-Delegation Doctrine. The Government resisted the Motion, asserting that the "issues" raised in it had all been considered and rejected by *752 the Eighth Circuit in United States v. May, 535 F.3d 912 (8th Cir.), petition for cert. filed (U.S. Dec. 30, 2008) (No. 08-7997). Each of Voice's claims will be addressed below.
III.
Rule 12(b)(2) of the Federal Rules of Criminal Procedure provides for consideration, prior to trial, of "any defense, objection, or request that the court can determine without a trial of the general issue." To withstand a motion to dismiss, an indictment must allege that the defendant committed acts which, if proven, would constitute a violation of the law under which he has been charged. United States v. Polychron, 841 F.2d 833, 834 (8th Cir.), cert denied, 488 U.S. 851, 109 S.Ct. 135, 102 L.Ed.2d 107 (1988). If the acts alleged in the indictment do not constitute a criminal offense, then the indictment should be dismissed. See e.g. United States v. Coia, 719 F.2d 1120, 1123 (11th Cir.1983), cert. denied, 466 U.S. 973, 104 S.Ct. 2349, 80 L.Ed.2d 822 (1984).
In reviewing the sufficiency of an indictment, a court must determine whether the indictment includes the elements of the offense, provides adequate notice of the charge, and enables the defendant to plead double jeopardy as a bar to further prosecution. Hamling v. United States, 418 U.S. 87, 117, 94 S.Ct. 2887, 41 L.Ed.2d 590 (1974); United States v. Hernandez, 299 F.3d 984, 992 (8th Cir.2002), cert. denied, 537 U.S. 1134, 123 S.Ct. 918, 154 L.Ed.2d 825 (2003). "An indictment will ordinarily be held sufficient unless it is so defective that it cannot be said, by any reasonable construction, to charge the offense for which the defendant was convicted." Hernandez, 299 F.3d at 992.
"An indictment should be tested solely on the basis of the allegations made on its face, and such allegations are to be taken as true." United States v. Sampson, 371 U.S. 75, 78-79, 83 S.Ct. 173, 9 L.Ed.2d 136 (1962). "Courts should refrain from considering evidence outside the indictment when testing its legal sufficiency." United States v. Hall, 20 F.3d 1084, 1087 (10th Cir.1994). However, it is permissible, and even desirable in certain circumstances, for a court to consider evidence in connection with a pretrial motion to dismiss, particularly where the operative facts are undisputed and not objected to, in order to ascertain whether the elements of the criminal charge can be established. Id. at 1087-88; United States v. Brown, 925 F.2d 1301, 1304 (10th Cir. 1991).
Due deference to the decisions of another branch of government demands that a congressional enactment be invalidated only upon a "plain showing" that Congress exceeded its constitutional bounds. United States v. Morrison, 529 U.S. 598, 607, 120 S.Ct. 1740, 146 L.Ed.2d 658 (2000). It is with this presumption of constitutionality in mind that the Court must review Voice's claims. Id.
IV.
SORNA was enacted on July 27, 2006, as a component of the Adam Walsh Child Protection and Safety Act of 2006, Pub.L. No. 109-248, 120 Stat. 587 (July 27, 2006). SORNA establishes "a comprehensive national system" for the registration of sex offenders. 42 U.S.C. § 16901. Under this national system, each jurisdiction is required to maintain "a jurisdiction-wide sex offender registry" that conforms to the requirements of SORNA. 42 U.S.C. §§ 16911(10), 16912(a).
Under SORNA, "an individual who is convicted of a sex offense" must "register and keep the registration current, in each jurisdiction where the offender resides, *753 where the offender is an employee, and where the offender is a student." 42 U.S.C. §§ 16911(1), 16913(a). A sex offender must initially register in the jurisdiction in which he was convicted, § 16913(a), and within three days after any change of "name, residence, employment or student status" the offender must appear in person and at least one jurisdiction involved and notify that jurisdiction of all changes in the information which must be reported to the sex offender registry, § 16913(c).
In addition to mandating registration, SORNA criminalizes the failure to register. In particular, SORNA makes it a crime for any sex offender who "is required to register" and who "knowingly fails to register or update a registration." § 2250(a).
Congress delegated the authority to promulgate regulations regarding the scope and breadth of SORNA to the United States Attorney General. § 16913(d). On February 28, 2007, the Attorney General issued an interim rule clarifying that SORNA's requirements were applicable "to all sex offenders, including sex offenders convicted of the offense for which registration is required prior to the enactment of [SORNA]." 28 C.F.R. § 72.3 (2007).
SORNA also requires jurisdictions to conform their sex offender registries to federal requirements by July 27, 2009 or risk losing part of their federal funding. 42 U.S.C. §§ 16924(a), 16925(a). The jurisdictions relevant to the instant case, namely, the State of South Dakota and the Crow Creek Sioux Tribe, have not yet complied with or fully implemented these requirements.
V.
Voice claims that his prosecution under SORNA violates the Ex Post Fact Clause[1] which forbids Congress from passing any law "which imposes a punishment for an act which was not punishable at the time it was committed; or imposes additional punishment to that then prescribed." Weaver v. Graham, 450 U.S. 24, 28, 101 S.Ct. 960, 67 L.Ed.2d 17 (1981) (footnotes and citations omitted). In support of his claim, Voice asserts that (1) he is now being punished for conduct that occurred in 1998, which did not become a crime until 2006, and (2) the only laws in effect at the time of his offense were South Dakota state statutes, SDCL 22-22-30 et seq., and the Jacob Wetterling Act, Pub.L. No. 103-322, 108 Stat. 2038 (Sept. 13, 1994) (codified as 42 U.S.C. § 14071), which carried lesser penalties than SORNA.
Contrary to Voice's assertions, the Eighth Circuit's reasoning and ultimate holding in May, 535 F.3d at 919-20 made clear that neither SORNA's registration requirements nor the criminal penalties attached to non-compliance with § 2250 violate the Ex Post Facto Clause. United States v. Hinckley, 550 F.3d 926, 936 (10th Cir.2008). petition for cert. filed (U.S. Feb. 9, 2009) (No. 08-8696): see also United States v. Lawrance, 548 F.3d 1329, 1332-34 (10th Cir.2008) (prosecution under SORNA's failure to register provisions did not retroactively increase the punishment for the defendant's past sex offenses). The Court finds and concludes that "the legislative intent expressed in SORNA's preamble and SORNA's primary effect satisfy the requirements of the Ex Post Facto Clause." Hinckley, 550 F.3d at 936; see also May, 535 F.3d at 919-20.
A.
Voice contends that his indictment for failure to register under § 2250 punishes *754 him for acts committed prior to SORNA's enactment and therefore violates the Ex Post Facto Clause. SORNA, however, does not impose additional punishment for a predicate sex offense. Instead, SORNA works prospectively, creating a new punishment for a new offense, to wit, failing to register as a sex offender after July 27, 2006. United States v. Shenandoah, 572 F.Supp.2d 566, 573-74 (M.D.Pa.2008) (citations omitted).
In this case, Voice is charged with failing to register between August 5, 2008 and October 2, 2008. This time period is well after SORNA's effective date and after the regulations promulgated by the Attorney General clarifying SORNA's applicability to previously convicted sex offenders. This being the case, applying SORNA's criminal provisions to Voice's alleged criminal conduct does not implicate ex post facto strictures. United States v. Dumont, 555 F.3d 1288, 1290-92 (11th Cir.2009); United States v. Begay, No. CR08-1203-PHX-DGC, 2009 WL 465026 at *6 (D.Ariz. Feb. 24, 2009); United States v. Watchman, No. CR08-1202-PHX-DGC, 2009 WL 464995 at *6 (D.Ariz. Feb. 24, 2009).
B.
Voice also maintains that SORNA retroactively increases his punishment and by doing so violates the Ex Post Facto Clause. Yet, as the court in May observed, if a defendant is not even subject to the interim regulations promulgated by the Attorney General, then there is no Ex Post Facto Clause problem. May, 535 F.3d at 919. And, to the extent that Voice challenges the overall applicability of SORNA, under the ex post facto framework of Smith v. Doe, 538 U.S. 84, 123 S.Ct. 1140, 155 L.Ed.2d 164 (2003), his challenge must likewise fail. May, 535 F.3d at 919-20.
In analyzing a claim that the Ex Post Facto Clause has been violated, a court must determine whether the statute is civil or criminal in nature. Id. at 919 (citing Kansas v. Hendricks, 521 U.S. 346, 361, 117 S.Ct. 2072, 138 L.Ed.2d 501 (1997)). This analysis requires an inquiry into legislative intent, including the manner the statute was codified and enforced, and its effect. Smith, 538 U.S. at 93-106, 123 S.Ct. 1140.
Congress' stated purpose and intent, when enacting SORNA, was to create a civil and non-punitive regulatory scheme. § 16901; see also 72 Fed.Reg. 8,894, 8,896 (Feb. 28, 2007). This scheme is not so punitive that it negates Congress' express desire to create a civil remedy and not a criminal penalty. May, 535 F.3d at 920. As relevant here, the only punishment that can arise under SORNA comes from a violation of § 2250, which punishes a convicted sex offender under federal law who knowingly fails to register and update his registration as required. § 2250(a)(1), (2)(A), (3). Congress clearly intended for SORNA to apply to persons convicted before July 27, 2006. In fact, SORNA defines a sex offender as "an individual who was convicted of a sex offense." § 16911(1) (emphasis added). If SORNA did not apply to someone already convicted of a sex offense, Congress' stated purpose of establishing a "comprehensive national system" for the registration of sex offenders would have been thwarted. May, 535 F.3d at 920.
Section 2250 punishes Voice for failing to register and keep his registration updated, not for being previously convicted of a sex crime. Prosecuting him, like the defendant in May, for violating this statute "is not retrospective and does not violate the Ex Post Facto Clause." Id. at 920.
VI.
Voice next raises three distinct due process challenges to SORNA. First, he asserts *755 that it is a violation of due process to punish him for failing to register when he was unable to do so. Second, he contends that he had no duty to register because he was not notified of SORNA's requirements. Third, he argues that SORNA is ambiguous and should be struck down on this basis. For the reasons discussed below, none of these challenges warrant dismissal of the Indictment.
A.
Voice initially claims that he was not able to comply with SORNA because it had not yet been implemented by the Crow Creek Tribe and that, as a result, punishing him for failing to register under SORNA violates the Fifth Amendment's Due Process Clause.[2] The Court disagrees.
Section 16912 directs the Attorney General to "issue guidelines and regulations to interpret and implement" SORNA. In subsequent guidelines, the Attorney General plainly expressed that SORNA applies to sex offenders convicted of any predicate offense before SORNA's enactment. 73 Fed.Reg. 38,030, 38,046 (July 2, 2008).
Furthermore, § 16913(d) grants the Attorney General the authority "to specify the applicability of [SORNA's] requirements... to sex offenders convicted before... its implementation in a particular jurisdiction, and to prescribe rules for the registration of any such sex offenders ... who are unable to comply with [the initial registration requirements]" (emphasis added). The Attorney General, in guidelines issued by him, then explicitly stated that "[t]he applicability of the SORNA requirements is not limited to sex offenders whose predicate sex offense convictions occur following a jurisdiction's implementation of a conforming registration program." 72 Fed.Reg. 30,210, 30,212 (May 30, 2007) (emphasis added). The Attorney General, later on in the same regulations, reiterated that "SORNA applies to all sex offenders, including those convicted of their registration offenses prior to the enactment of SORNA or prior to particular jurisdictions' incorporation of the SORNA requirements into their programs." Id. at 30,228.
Beyond this, SORNA merely obligates a sex offender to notify the relevant "jurisdiction(s) of all changes in the information required for that offender in the sex offender registry." See § 16913(c). While SORNA does impose additional requirements on jurisdictions to improve their registry systems, these requirements are separate and apart from those imposed on sex offenders. See § 16913 (setting forth the registry requirements for sex offenders), § 16912 (containing the registry requirements for jurisdictions). A jurisdiction's failure to implement and/or update its registration system to conform with SORNA's requirements does not relieve the sex offender of his independent duty to register all information that is required by then existing state law. Shenandoah, 572 F.Supp.2d at 578-79 (citations omitted). Every district court to confront the issue has held that a defendant could comply with SORNA even when the jurisdiction in which the defendant was required to register had not yet implemented the federal law. Shenandoah, 572 F.Supp.2d at 579; see also United States v. Contreras, No. EP-08-CR1696-PRM, 2008 WL 5272491 at *6 (W.D.Tex. Dec. 18, 2008) (Texas); *756 United States v. Benton, No. 2:08-CR-156, 2008 WL 5273971 at *6 (S.D.Ohio Dec. 16, 2008) (Ohio); United States v. Keleher, No. 1:07-cr-00332-OWW, 2008 WL 5054116 at *6 (E.D.Cal. Nov. 19, 2008) (California); United States v. Morris, Crim. No. 08-0142, 2008 WL 5249231 at **3-4 (W.D. Louisiana Nov. 14, 2008) (Louisiana); United States v. Crum, No. CR08-255RSL, 2008 WL 4542408 at *2-3 (W.D. Wash. Oct. 8, 2008) (Washington); United States v. Stevens, 578 F.Supp.2d 172, 179-82 (D.Maine 2008) (Maine and Rhode Island); United States v. Senogles, 570 F.Supp.2d 1134, 1157-58 (D.Minn.2008) (Minnesota). And, at least one appeals court that has addressed the issue, has upheld this view. Hinckley, 550 F.3d at 939 (Oklahoma). The fact that the case at hand involves an Indian tribe's failure to implement SORNA does not change the result. Begay, 2009 WL 465026 at **2-4; Watchman, 2009 WL 464995 at **2-4.
While the Crow Creek Tribe's sex offender registration program is not yet up and running and as such does not meet SORNA's requirements, Voice is not being prosecuted for providing less information than SORNA dictates. Rather, he is charged with outright failure to register and/or update his registration. Voice knew that he had an obligation to register as a sex offender because he did so previously with one or more state agencies. He thus had the ability to comply with SORNA and will not be permitted to use the Tribe's failure to implement SORNA's mandates to excuse or vitiate his alleged non-compliant behavior. Begay, 2009 WL 465026 at *5; Watchman, 2009 WL 464995 at *5.
B.
Voice next argues that he cannot be prosecuted under SORNA because he was not notified of its registration requirements. This argument is likewise unavailing.
Generally, "ignorance of the law" does not absolve one of criminal responsibility. Lambert v. California, 355 U.S. 225, 228, 78 S.Ct. 240, 2 L.Ed.2d 228 (1957). A narrow exception exists to this maxim when the defendant's conduct is "wholly passive" and does not alert him to the fact that he is engaging in criminal activity. Id.
In Lambert, the Supreme Court considered whether a defendant, who had no actual knowledge of a city ordinance that made it unlawful for a felon to be or remain in the city for more than five days without registering, could be convicted for failing to register pursuant to the ordinance. 355 U.S. at 226, 78 S.Ct. 240. The Court held that the ordinance violated due process because the defendant had no actual knowledge of the registration requirement and because the circumstances were not such that he would have been likely to inquire as to the necessity of registration. Id. at 229, 78 S.Ct. 240. The Court, however, recognized that due process "does not require that a defendant have actual knowledge of a duty to register where the facts demonstrate `proof of the probability'" that he had such knowledge. Id. at 229-30, 78 S.Ct. 240. In other words, "constructive knowledge of an affirmative duty to register is enough to satisfy due process requirements." Id.
SORNA does seem to criminalize the same type of "wholly passive" conduct that Lambert proscribed. Even so, an overwhelming majority of courts have held that a defendant's knowledge of his obligation to register as a sex offender pursuant to state law provides sufficient proof of the probability that he was aware of his obligation to register under SORNA. May, 535 F.3d at 921; Hinckley, 550 F.3d at 938; United States v. Pendleton, Criminal *757 Action No. 08-59-GMS, 2009 WL 320546 at *8 (D.Del. Feb. 10, 2009); Shenandoah, 572 F.Supp.2d at 580.
Here, Voice's successful compliance with state requirements provides evidence that he understood his responsibility to register as a sex offender and was able to fulfill that responsibility. Shenandoah, 572 F.Supp.2d at 580-81. So too does the fact that Voice acknowledged being notified, in his July 7, 2008 registration form, that he had a duty to advise law enforcement agencies of any change of address and of his relocation and that he could be charged with a state offense if he failed to do this. Id. at 581; see also Begay, 2009 WL 465026 at *4; Watchman, 2009 WL 464995 at *4. Courts have determined that a defendant can violate SORNA if he fails to register or update a SORNA imposed registration obligation or a parallel one imposed by some other law. Id.; see also Hinckley, 550 F.3d at 939.
The Court finds and concludes that Voice had at least constructive notice of his duty to register pursuant to SORNA. His status as a sex offender should have alerted him to his responsibility to register and to update his registration. Given his existing knowledge of state registration requirements, his failure to register appears to be the result of active, rather than "wholly passive", conduct. Voice, however, is charged with not having registered or updated his registration, the requirements of which he had ample notice of. His argument, that he did not comply with SORNA because he lacked notice of its provisions, must, per force, fail. Begay, 2009 WL 465026 at *5; Watchman, 2009 WL 464995 at *5.
C.
Voice seeks to strike down SORNA as being unconstitutional because it is ambiguous. Specifically, he maintains that an ambiguity exists between the notification and verification provisions found in § 16913(c) and 42 U.S.C. § 16916. The former commands that a sex offender, not later than three business days after each change of name, residence, employment or student status, appear in person in at least the jurisdiction where he resides, is an employee or a student, and inform that jurisdiction of all changes in the information required for him in the sex offender registry. The latter directs that such an offender appear in person, and allow the jurisdiction to take a current photograph and verify information in each registry in which he is required to be registered each year, six months or three months, depending upon the tier level he is classified as.
There is nothing ambiguous about these statutes or what they require an offender to do. The disclosure edicts found in § 16913(c) are limited to those instances where there is a change in the offender's status, whether by way of a new or different name, home, job or school situation. By contrast, the verification proviso contained in § 16916 only applies to certain defined intervals, based on the offender's classification level. The offender is required to provide information every time there is a change in his status and, at whatever time intervals his tier level dictates.
In Voice's case, he was advised in writing, on July 7, 2008, of the exact months (January 2009 and July 2009) he was required to re-register (i.e., provide verifying information for the registry). At the same time, he was advised that he was obligated to provide written notification of any change of address and relocation within five days of the same. Although not fully in accord with SORNA's requirements, these advisements were unequivocal and left no room for confusion. Voice knew or should have known that, as a sex offender, *758 he was required to notify a law enforcement agency of any change of address or of his relocation within five days after the same or risk being subjected to criminal penalties. There is nothing ambiguous about this and nothing that comes even remotely close to a due process violation.
VII.
Voice further claims that Congress violated the Non-Delegation Doctrine by authorizing the Attorney General to determine SORNA's retroactivity. He lacks standing, however, to raise this claim. May, 535 F.3d at 920-21; see also Hinckley, 550 F.3d at 939 (§ 16913(d) "does not apply to offenders who are required to and have already initially registered and [the defendant] therefore lacks standing to bring this claim"); United States v. Summers, No. 8:08CR256, 2008 WL 5255816 at *2 (D.Neb. Dec. 16, 2008) (the defendant "lacks standing to raise a challenge to the Attorney General's authority delegated by Congress to apply SORNA to persons convicted before July 27, 2006 because [he] was able to register before SORNA's enactment"). But even assuming otherwise, arguendo, he cannot prevail on the merits of his claim.
Under the Constitution, "[a]ll legislative Powers herein granted shall be vested in a Congress of the United States." U.S. Const. art. I, § 1. It is from this language that the Non-Delegation Doctrine has been derived: Congress may not constitutionally delegate its legislative power to another branch of government. Touby v. United States, 500 U.S. 160, 165, 111 S.Ct. 1752, 114 L.Ed.2d 219 (1991); see also United States v. Garfinkel, 29 F.3d 451, 457 (8th Cir. 1994). The Doctrine, however, "does not prevent Congress from seeking assistance, within proper limits, from its coordinate Branches." Mistretta v. United States, 488 U.S. 361, 372, 109 S.Ct. 647, 102 L.Ed.2d 714 (1989). So long as Congress "lay[s] down by legislative act an intelligible principle to which the person or body authorized to [act] is directed to conform, such legislative action is not a forbidden delegation of legislative power." Touby, 500 U.S. at 165, 111 S.Ct. 1752 (quoting J.W. Hampton, Jr. & Co. v. United States, 276 U.S. 394, 409, 48 S.Ct. 348, 72 L.Ed. 624 (1928)). In applying this "intelligible principle" test, the Supreme Court has afforded Congress wide latitude in delegating its powers and has upheld every congressional delegation of power that the Court has confronted since 1935. Mistretta, 488 U.S. at 373-74, 109 S.Ct. 647. The Court has deemed it "constitutionally sufficient" if Congress clearly delineates the general policy, the public agency which is to apply it, and the boundaries of this delegated authority. Id. at 373-73, 109 S.Ct. 647 (quoting American Power & Light Co. v. SEC, 329 U.S. 90, 105, 67 S.Ct. 133, 91 L.Ed. 103 (1946)).
When enacting SORNA, Congress delegated to the Attorney General the authority to specify the applicability of SORNA's requirements to sex offenders convicted before its enactment and to prescribe rules for other sex offenders who are unable to comply with the initial registration requirements. Every court that has passed on the merits of the issue has held that this delegation of authority was not unlawful. See e.g. Begay, 2009 WL 465026 at *5; Keleher, 2008 WL 5054116 at **12-15; Stevens, 578 F.Supp.2d at 182-84; United States v. Vasquez, 576 F.Supp.2d 928, 939-40 (N.D.Ill.2008); Shenandoah, 572 F.Supp.2d at 586-89; United States v. Van Buren, No. 3:08-CR-198, 2008 WL 3414012 at *15 (N.D.N.Y. Aug. 8, 2008); Senogles, 570 F.Supp.2d at 1150-51.
As one district court observed:
[SORNA's] delegation was proper since Congress established a clear policy of *759 protecting the public from sex offenders and offenders against children, was specific that the delegation was to the Attorney General, and established boundaries of the delegation by limiting the applicability of the Attorney General's rules to those convicted before the enactment of SORNA and to those who were unable to comply with the initial registration.
United States v. Natividad-Garcia, 560 F.Supp.2d 561, 567-68 (W.D.Tex.2008). In view of the Attorney General's prior experience with the Jacob Wetterling Act, the clear intent of Congress to encompass as many sex offenders as possible within SORNA's purview, and the specific provisions of § 16913(d), the Court finds and concludes that Congress provided the Attorney General with an "intelligible principle" to use in crafting the required rules and as such, did not violate the Non-Delegation Doctrine of the Constitution.
VIII.
Voice lastly claims that SORNA, as applied to him, violates the Commerce Clause.[3] He argues that he is being charged with, and could be convicted and punished for, intrastate registration activity that does not substantially affect interstate commerce. Voice's claim, however, is foreclosed by the Eighth Circuit's recent decisions in United States v. Howell, 552 F.3d 709, 713-17 (8th Cir.2009) and May, 535 F.3d at 921-22 and by other decisions from district courts, see United States v. Thompson, 595 F.Supp.2d 143, 145-46 (D.Me.2009); Senogles, 570 F.Supp.2d at 1147. But even if these decisions are distinguishable and the claim somehow survives, it nonetheless does not provide Voice with a basis for relief.
The Supreme Court has enumerated "three general categories of regulation which Congress is authorized to engage under its commerce power." Gonzales v. Raich, 545 U.S. 1, 16, 125 S.Ct. 2195, 162 L.Ed.2d 1 (2005). "First, Congress can regulate the channels of interstate commerce. Second, Congress has authority to regulate and protect the instrumentalities of interstate commerce, and persons or things in interstate commerce. Third, Congress has the power to regulate activities that substantially affect interstate commerce." Id. at 16-17, 125 S.Ct. 2195; see also United States v. Lopez, 514 U.S. 549, 558-59, 115 S.Ct. 1624, 131 L.Ed.2d 626 (1995).
Congress also has the authority "[t]o make all Laws which shall be necessary and proper" for the accomplishment of its commerce power. U.S. Const. art. I, § 8, cl. 18. "[A] law does not have to be undeniably necessary to be proper," Howell, 552 F.3d at 714 (citing McCulloch v. Maryland, 17 U.S. (4 Wheat.) 316, 413, 4 L.Ed. 579 (1819)), so long as it is "a rational and appropriate means to further Congress's regulation of interstate commerce," Howell, 552 F.3d at 714 (citing United States v. Darby, 312 U.S. 100, 121, 61 S.Ct. 451, 85 L.Ed. 609 (1941)).
Congress' regulatory authority under the Commerce Clause can be extended to wholly intrastate activity. The Supreme Court long ago stated that Congress can regulate intrastate economic activities if the same have a substantial effect on interstate commerce. See Wickard v. Filburn, 317 U.S. 111, 125, 63 S.Ct. 82, 87 L.Ed. 122 (1942). The Court has also recognized that Congress may regulate even non-economic local activity if that regulation is a *760 necessary part of a more general regulation of interstate commerce. Lopez, 514 U.S. at 561, 115 S.Ct. 1624.
Under § 2250(a)(2), only those sex offenders who were convicted of a federal sex offense or who travel in interstate or foreign commerce, or enter, leave or reside in Indian country are subject to SORNA's registration requirements and to prosecution for violating them. Thus, a South Dakota resident who has been convicted of a qualifying state sex offense but does not leave the state is not subject to SORNA if he fails to register. Instead, he can only be charged and punished under South Dakota law for failing to register as a sex offender. His purely intrastate status makes him out of the reach of SORNA.
By contrast, Voice has an interstate nexus which brings him within the grasp of SORNA. First, he was previously convicted of a federal sex offense, in Indian country. See § 2250(a)(2)(A). Second, the factual information of record indicates that Voice was living in Sioux Falls when he re-registered on July 7, 2008, and then entered, and may well have been residing on, the Crow Creek Reservation at or prior to the time he was arrested, nearly three months later. See § 2250(a)(2)(B): see also United States v. Dixon, 551 F.3d 578, 583 (7th Cir.2008) ("The reference to "Indian country" is a tipoff ... [that] is designed to establish the constitutional predicate for the statute...."). Both of these facts, have federal and/or interstate components to them, which make it "necessary and proper" for Congress, through the use of its Commerce Clause power, to extend its regulatory arm to Voice vis-a-vis SORNA and § 2250. Voice has no cause to complain about SORNA being applied to him in view of his circumstances and in particular, the inter-connections between himself, federal law and the Crow Creek Reservation.
IX.
Based on the foregoing discussion and in accordance with § 636(b)(1), the Court hereby
RECOMMENDS that Voice's Motion to Dismiss Indictment, found at Docket No. 15, be denied in all respects.
Dated this 5th day of March, 2009, at Pierre, South Dakota.
NOTES
[1] More specifically, Voice's sex offender registration form advised Voice that he must register bi-annually with the appropriate law enforcement agency within South Dakota. The form also advised Voice that a change of address required in person written notification to proper law enforcement agencies within five days of relocation, including moves out of the state. Voice signed the form, indicating that he read the form and that he was aware that a violation of the registration laws was a Class 6 felony. Exhibit C.
[2] The court finds that it need not address whether Congress violated the non-delegation doctrine in the event Voice did in fact have standing. Based on Eighth Circuit precedent, which is binding on this court, the court finds that Voice has no standing to make such an argument. Accordingly, the court does not adopt the magistrate judge's report and recommendation in relation to its finding that if Voice had standing, his non-delegation argument is without merit because it is unnecessary to resolve this issue at this point in time.
[1] See U.S. Const. art. I, § 9, cl. 3.
[2] Voice also raises a "stand alone" claim that SORNA is not applicable to him because the Tribe has not yet implemented, as of February 12, 2009, a sexual offender registry, after electing, by tribal resolution, to carry out SORNA within its own jurisdiction and not consenting to the exercise of any state jurisdiction or cooperation. This claim will be addressed with, and as part of, the due process claim.
[3] See Under this Clause, Congress is authorized "[t]o regulate Commerce with Foreign Nations, and among the several states, and with the Indian Tribes[.]" U.S. Const. art I, § 8, cl. 3.
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(2008)
Eloy Rojas MAMANI, et al., Plaintiffs,
v.
Gonzalo Daniel Sanchez de Lozada Sanchez BUSTAMANTE, Defendant.
Civil Action No. AW-07-2507.
United States District Court, D. Maryland, Southern Division.
April 15, 2008.
MEMORANDUM OPINION
ALEXANDER WILLIAMS, JR., District Judge.
Plaintiffs Eloy Rojas Mamani, Etelvina Ramos Mamani, Sonia Espejo Villalobos, Hernan Apaza Cutipa, Jaun Patricio Quispe Mamani, Teofilo Baltazar Cerro, Juana Valencia De Carvajal, Hermogenes Bernabe Callizaya, Gonzalo Mamani Aguilar, and Felicidad Rosa Huanca Quispe (collectively "Plaintiffs"[1]) bring this action against the ex-President of the Republic of Bolivia, Gonzalo Daniel Sanchez De Lozada Sanchez Bustamante ("Defendant" or "Defendant Sanchez de Lozada"), seeking compensatory and punitive damages against Defendant for his role in the massacre of Bolivian civilians. Currently pending before the Court is Defendant's Motion to Transfer Venue to the Southern District of Florida (Doc. No. 24). The Court has reviewed the entire record with respect to the instant motion. The Court held a hearing on this motion on April 7, 2008. See Local Rule 105.6 (D. Md. 2008).[2] The issues having been fully briefed and argued by the parties, this matter is now ripe for review. For the reasons set forth below, the Court will GRANT Defendant's Motion to Transfer.
FACTUAL AND PROCEDURAL BACKGROUND
Defendant Sanchez de Lozada was the democratically elected President of Bolivia from 1993 to 1997, and was re-elected to a second term that began in August 2002 and ended in October 2003. During his second term, opponents of the governing party began protesting the government's policies, specifically the economic programs. As a result of the protesting, violence began to brew in February 2003. In their complaint, Plaintiffs allege that Defendant used military force to silence opposition and intimidate the civilian population by killing demonstrators.[3]
The protests continued to grow in strength, which resulted in more violence. In September 2003, thousands of rural villagers, unions, and community groups began widespread protests and strikes to oppose government policies. On September 19, 2003, the head of the Bolivian Police declared a state of emergency in Bolivia. The protesting, attacks, and violence continued throughout the months of September and October, and many were killed or wounded, including protestors, bystanders, and police and military.[4] On October 17, 2003, Defendant Sanchez de Lozada resigned as the President of the Republic of Bolivia, and, within hours of his resignation, departed Bolivia and flew to Miami, Florida.
On September 19, 2007, Plaintiffs filed suit against Defendant Sanchez de Lozada, asserting three claims for relief: (1) Extrajudicial Killing, pursuant to the Torture Victim Protection Act; (2) Crimes Against Humanity, pursuant to the Alien Tort Statute; and (3) violation of the Rights to life, liberty and security of person and freedom of assembly and association, pursuant to the Alien Tort Statute. On that same day, Plaintiffs also filed a virtually identical action (hereinafter the "Florida action") in the United States District Court for the Southern District of Florida against Jose Carlos Sanchez Berzain, who served as Minister of Defense during Defendant Sanchez de Lozada's presidency in Bolivia, seeking to collect tort damages for the very same events that took place in Bolivia.[5]
Defendant moves to transfer this action to the Southern District of Florida for the purpose of consolidating this action with the case filed in that district by the same plaintiffs and involving common issues of fact and law pertaining to both Defendants.
STANDARD OF REVIEW
Section 1404(a) provides: "For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought." 28 U.S.C. § 1404(a) (2008). The purpose of § 1404(a) is "to prevent the waste of time, energy, and money" and "to protect litigants, witnesses, and the public against unnecessary inconvenience and expense." Van Dusen v. Barrack, 376 U.S. 612, 616, 84 S.Ct. 805, 11 L.Ed.2d 945 (1964); see also Lynch v. Vanderhoef Builders, 237 F.Supp.2d 615, 617 (D.Md.2002) (same). In a motion to transfer pursuant to § 1404(a), "the burden is on the moving party to show that transfer to another forum is proper." Lynch, 237 F.Supp.2d at 617.
The standards for transfer under § 1404 are: "(1) the transferee court must be a court in which the action could have been brought initially; (2) the transfer must be convenient to the parties and witnesses; and (3) the transfer must be in the interest of justice." Dow v. Jones, 232 F.Supp.2d 491, 499 (D.Md.2002). In deciding a motion to transfer venue under § 1404(a), the court must "weigh in the balance a number of case-specific factors." Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29, 108 S.Ct. 2239, 101 L.Ed.2d 22 (1988). Courts are to consider the following factors: (1) the weight accorded to plaintiffs choice of forum; (2) witness convenience and access; (3) convenience of the parties; and (4) the interests of justice. Cross v. Fleet Reserve Ass'n Pension Plan, 383 F.Supp.2d 852, 856 (D.Md.2005). However, unless the balance of factors "is strongly in favor of the defendant, the plaintiffs choice of forum should rarely be disturbed." Collins v. Straight Inc., 748 F.2d 916, 921 (4th Cir.1984). The decision whether to transfer venue is committed to the sound discretion of the trial court. See Brock v. Elitre Computer Centers, Inc., 933 F.2d 1253, 1257 (4th Cir.1991).
DISCUSSION
The parties dispute whether this action could have initially been brought in the Southern District of Florida. Therefore, the Court must first decide this threshold jurisdictional issue before weighing the convenience factors.
I. Jurisdiction in the Southern District of Florida
Pursuant to Florida Statute § 48.193(2),[6] Florida can exercise general personal jurisdiction over a defendant "who is engaged in substantial and not isolated activity" within Florida. As both parties note, Florida's statute is equivalent to the "systematic and continuous" contacts required for the exercise of general jurisdiction consistent with the Due Process clause of the federal constitution. See Am. Overseas Marine Corp. v. Patterson, 632 So.2d 1124, 1128 (Fla. 1st DCA 1994) ("The Florida courts have harmonized the language of section 48.193(2) with the constitutional due process requirements... by holding that substantial and not isolated activity means `continuous and systematic general business contacts.'"); see also Travel Opportunities of Fort Lauderdale, Inc. v. Walter Karl List Mgmt, Inc., 726 So.2d 313, 314 (Fla. 4th DCA 1998) (same). Under the Due Process clause, in analyzing whether a nonresident has the requisite minimum contacts with a state to justify personal jurisdiction, courts should determine whether the non-resident's "conduct and connection with the forum State are such that he should reasonably anticipate being haled into court there." Hatfield v. AutoNation, Inc., 915 So.2d 1236, 1242 (Fla. 4th DCA 2005) (citing World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980)). In determining whether Defendant has substantial contacts with Florida, Florida courts have also assessed the "collective effect of the defendant's activities" over "a period of years prior to the plaintiffs filing of the complaint." Dean v. Johns, 789 So.2d 1072, 1077-78 (Fla.Dist.Ct.App. 2001).
Defendant argues that Florida could have properly exercised personal jurisdiction over him, pursuant to Florida's longarm statute, where he maintains his primary personal checking account in Florida,[7] has contracted with investment advisors in Florida to manage his personal investments, has retained several attorneys in Florida to handle his affairs and has had Florida attorneys under active retainer since 2003, has conducted media interviews in Miami, and has made a number of visits, for a multitude of reasons, to Florida.[8] Defendant also contends that, from 1999 until 2002, he was a member of the Leadership Council for Inter-American Summitry, which' was a part of the North-South Center of the University of Miami. Moreover, from November 2005 to November 2007, Defendant claims to have contracted with a personal investment manager physically located in Miami who managed Defendant's accounts. Defendant also expressly authorized one of his Florida attorneys to serve as his agent for service of process with regard to his immigration matters.[9]
Plaintiffs, on the other hand, argue that these contacts are not "systematic and continuous" and amount to "no more than that of a typical tourist to the Sunshine State,"[10] where Defendant maintains no residence in Florida, derives no income in Florida, and transacts no business in Florida. It appears to the Court that Plaintiffs have isolated each of Defendant Sanchez de Lozada's contacts in an attempt to prove that each isolated activity is insufficient to support the assertion of personal jurisdiction over Defendant in Florida. Indeed, the Court recognizes that any one of these contacts, standing alone, may not be deemed sufficient; however, the Court believes that such contacts, when considered collectively, are sufficient to establish personal jurisdiction.[11]See AutoNation, Inc. v. Whitlock, 276 F.Supp.2d 1258, 1263 (S.D.Fla.2003) ("In making this finding, the Court notes that it is [the defendant]'s activities considered collectively and over the five year period between 1998 and 2003, as opposed to any single activity alone, that establishes personal jurisdiction."); see also Woods v. Nova Cos. Belize Ltd., 739 So.2d 617, 621 (Fla. 4th DCA 1999) ("While any one of [the defendant's] activities alone may not be deemed sufficient, considered collectively, they establish personal jurisdiction.").
Therefore, considering Defendant's activities in Florida collectively over a period of years prior to the filing of the complaint, the Court finds that evidence supports the view that Defendant engaged in substantial and not isolated activity in Florida. Moreover, the Court finds that Defendant purposefully availed himself of Florida's privileges and protections by: (1) maintaining his primary checking account in Florida (which is accessed 25 to 30 times per month); (2) contracting with investment advisors in Florida to manage his personal investments; (3) retaining several Florida attorneys to handle his affairs, including authorizing a Florida attorney to accept service of process with regards to immigration matters; (4) joining and being recognized by a membership organization in Florida; and (5) making many visits to Florida, during which, among other things, he sought legal advice, banking and investment services, and conducted media interviews. See Georgia Insurers Insolvency Pool v. Brewer, 602 So.2d 1264, 1268 (Fla. 1992) ("Factors that go into determining whether sufficient minimum contacts exist include the foreseeability that the defendant's conduct will result in suit in the forum state and the defendant's purposeful availment of the forum's privileges and protections."). The Court finds that these contacts are such that Defendant should have reasonably anticipated being haled into court in Florida, see World-Wide Volkswagen Corp., 444 U.S. at 297, 100 S.Ct. 559, and the maintenance of this action in Florida does not offend traditional notions of fair play and substantial justice. See International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945).[12] Accordingly, the Court finds that Defendant could have initially been sued in the Southern District of Florida.[13]
II. Weighing the Convenience Factors
Finding that the Southern District of Florida has personal jurisdiction over Defendant, the Court must now consider the following factors in determining whether a transfer would be appropriate:[14] (1) the weight accorded to plaintiffs choice of forum; (2) witness convenience and access; (3) convenience of the parties; and (4) the interests of justice. Cross, 383 F.Supp.2d at 856.
A. Plaintiffs' Choice of Forum
Although a plaintiffs choice of forum is generally "entitled to substantial weight," Bd. of Trs., Sheet Metal Workers National Fund v. Baylor Heating & Air Conditioning, Inc., 702 F.Supp. 1253, 1256 (E.D.Va.1988), a court need not accord the choice as much weight when the "forum has no connection with the matter in controversy." Dicken v. U.S., 862 F.Supp. 91, 93 (D.Md.1994) (quoting Mims v. Proctor & Gamble Distrib. Co., 257 F.Supp. 648, 657 (D.S.C.1966)); see also Lynch v. Vanderhoef Builders, 237 F.Supp.2d 615, 617 (D.Md.2002) (noting that the weight accorded to plaintiffs forum choice is "significantly lessened when none of the conduct complained of occurred in the forum selected by the plaintiff and said forum has no connection with the matter in controversy"). Moreover, "[w]hen the [plaintiffs] home forum has been chosen, it is reasonable to assume that this choice is convenient. When the plaintiff is foreign, however, this assumption is much less reasonable." Piper Aircraft Co. v. Reyno, 454 U.S. 235, 255-56, 102 S.Ct. 252, 70 L.Ed.2d 419 (1981).
Here, Defendant argues and the record reflects that all of the events giving rise to this controversy took place in Bolivia; Defendant was the ex-President of Bolivia; Plaintiffs reside in Bolivia; and the only link between this case and Maryland is that Defendant currently resides in Maryland. Under these circumstances, the Court concludes that Plaintiffs choice of forum is significantly lessened, and it is much less reasonable to assume that Plaintiffs' choice of this Court is the most convenient forum.
B. Witness Convenience and Access
The convenience of the witnesses is "perhaps the most important factor" in determining whether a transfer of venue should be granted. Cronos Containers Ltd. v. Amazon Lines, Ltd., 121 F.Supp.2d 461, 466 (D.Md.2000).
Defendant argues that the witnesses would substantially benefit from consolidating the instant case with Minister Berzain's case currently before the Southern District of Florida.[15] Defendant maintains that a majority of Plaintiffs' and Defendant's witnesses live in Bolivia and, therefore, the witnesses would potentially have to travel from Bolivia to both Maryland and Florida to participate in discovery and trial twice.
Defendant correctly notes that the Florida action will proceed regardless of the outcome of this motion. While the Court is not persuaded by Defendant's contention that there are direct international flights to Florida and not to the Maryland area, the Court does recognize that transferring this case to the Southern District of Florida which will likely involve the same Bolivian witnesses will save the witnesses time, energy, and money. A transfer will also protect the witnesses from unnecessary inconvenience and expense, as the witnesses will have to travel to both states for discovery and trial, if the matter proceeds to the trial stage. See Fox v. Callender, 729 F.Supp. 32, 34 (D.Md.1990). Considering that the convenience of the witnesses is the most important factor, the Court agrees that this factor militates persuasively in favor of transfer and consolidation in one court.
C. Convenience of the Parties
It appears to the Court that a transfer would likely be convenient for both parties and would not prejudice either party. Plaintiffs argue that Defendant cannot claim that the Southern District of Florida is a more convenient forum for him because Defendant resides in this district in Maryland. Although Defendant resides in Maryland, the Court notes that "the only connection that this case has with Maryland is the residence of Defendants, who, by their own motion, show a preference in having this action tried [elsewhere]." Fox, 729 F.Supp. at 34. The Court also notes that Plaintiffs, residents of Bolivia, will have to travel to both Florida and Maryland to litigate, including conducting discovery, in two separate actions that involved virtually identical facts and issues. Considering the circumstances, the Court finds that the convenience of the parties factor also militates persuasively in favor of transfer.
D. The Interests of Justice
A significant factor in considering the interests of justice is "avoiding duplicative litigation in courts," and the Court "may appropriately consider the `conservation of judicial resources and comprehensive disposition of litigation.'" Cronos Containers, 121 F.Supp.2d at 466.
The Court recognizes that the pending Florida action presents the same issues as are involved in this case. Plaintiffs filed the virtually identical action in the Southern District of Florida the exact same day as they filed suit in this Court. Plaintiffs are represented by the same attorneys in both actions, and Defendant Sanchez de Lozada in this action and Minister Berzain in the Florida action are represented by the same law firm. Additionally, the Court recognizes that this case turns on questions and defenses of federal and international law, not Maryland law. See Sheet Metal Workers, 702 F.Supp. at 1260 (noting that courts must consider their "familiarity with the applicable law.").
Plaintiffs, acknowledging that these two cases can be coordinated or even consolidated, suggest that this Court and the Court in the Southern District of Florida can readily prevent duplicative discovery through the entry of appropriate discovery orders in each case. Plaintiffs contend that such coordination would likely include a joint discovery plan, the cross-filing of deposition notices and document requests, and an order directing that discovery developed in one case can be used in the other. While Plaintiffs' suggestion is not wholly unfounded, the Court does not think it would be reasonable to have such coordination, especially considering that this matter can be appropriately transferred to the Southern District of Florida. The Court does not believe that keeping this case in this Court is in the interest of justice, when it would inevitably lead to duplicative litigation and potentially inconsistent rulings and would do nothing to conserve judicial resources. By having substantially similar actions in both Courts, as Defendant points out, it is at least arguable that Plaintiffs are attempting to "take two bites at the apple." Thus, the Court finds that a transfer will serve the interests of justice.
CONCLUSION
Finding that this action could have originally been brought in the Southern District of Florida, the Court finds no compelling reason against transferring this action, where this action and the virtually identical Florida action involve the same Plaintiffs, who filed both actions on the same day, seeking to recover the same damages in both actions for the same events occurring in Bolivia. Moreover, the parties in both actions are represented by the same attorneys, and both cases involve the same counts, with the exception of a few additional counts brought against the defendant in the Florida action. Therefore, there appearing to be no compelling reasons against transferring this action and it appearing that a transfer will serve the interests of justice and will be of convenience to the parties and witnesses, the Court will hereby transfer this action to the Southern District of Florida. An Order consistent with this Opinion will follow.
ORDER
For the reasons stated in the accompanying Memorandum Opinion, IT IS this 15th day of April, 2008, by the United States District Court for the District of Maryland, hereby ORDERED:
a. That Defendant's Motion to Transfer Venue to the Southern District of Florida (Doc. No. 24) BE, and the same hereby IS, GRANTED;
b. That this action BE, and the same hereby IS, TRANSFERRED to United States District Court for the Southern District of Florida;
c. That the Clerk of the Court CLOSE this case; AND
d. That the Clerk of the Court transmit a copy of this Memorandum Opinion and Order to all counsel and parties of record.
NOTES
[1] Plaintiffs, all natives and citizens of Bolivia, bring this action in their individual capacities and on behalf of their immediate family members who were allegedly killed by the Bolivian Armed Forces or persons or groups acting in coordination with the Armed Forces or under their control.
[2] Hereinafter "Motions Hearing."
[3] Plaintiffs allege that the government security forces were responsible for at least 38 deaths and 182 injuries in the first two months of 2003.
[4] Plaintiffs allege that there were 67 deaths and over 400 injuries during September and October 2003. However, the details of the specific events that occurred in Bolivia in September and October 2003 are not accounted here because they are not essential to the Court's ruling on Defendant's Motion to Transfer.
[5] As the Defendant noted during the Motions hearing, the only difference between the two suits is that the defendant in the Florida action was allegedly on-site during some of the killings. Plaintiffs also state in their opposition brief that the defendant in the Florida action "personally directed the Bolivian military:, actions when he was present at several of the actual sites of the murders in question, while the Defendant (Bolivia's former President appears not to have been present when these killings of civilians occurred."
[6] Fla. Stat. § 48.193(2) provides: "A defendant who is engaged in substantial and not isolated activity within this state, whether such activity is wholly interstate, intrastate, or otherwise, is subject to the jurisdiction of the courts of this state, whether or not the claim arises from that activity."
[7] The record reflects that Defendant Sanchez de Lozada has maintained his Florida bank account since December 12, 2003.
[8] Defendant maintains that over the course of at least 23 trips, he spent at least 89 days in Florida.
[9] Defendant also consents to jurisdiction in Florida. As Plaintiffs correctly note, the Supreme Court held that a transfer under § 1404(a) does not "depend upon the wish or waiver [or consent] of the defendant but, rather, upon whether the transferee district was one in which the action `might have been brought by the plaintiff.'" Hoffman v. Blaski, 363 U.S. 335, 343-44, 80 S.Ct. 1084. 4 L.Ed.2d 1254 (1960). The Supreme Court, however, noted that "[i]f when a suit is commenced, plaintiff has a right to sue in that district, independently of the wishes of defendant, it is a district `where the action might have been brought.'" Id. at 344, 80 S.Ct. 1084. Thus, this Court must determine whether this action could have originally been brought in the Southern District of Florida, independently of Defendant's consent.
[10] While Plaintiffs liken Defendant's contacts with Florida to those of a typical "tourist to the Sunshine State," the Court does not believe that the collective contacts described by Defendants, and supported by the record, can be accurately relegated to those of a mere tourist.
[11] To the extent that the Court evaluates each of Defendant's contacts separately, the Court must note that the cases relied upon by Plaintiffs to support their contention that certain isolated contacts are insufficient to establish jurisdiction are distinguishable. For example, with respect to Defendant's visits to Florida, Plaintiffs cite Dunlop v. Dunlop, 564 So.2d 618 (Fla.Dist.Ct.App.1990) to support the proposition that occasional visits did not give rise even to limited personal jurisdiction. That case, involving the modification of child support, is inapposite to this instant action, as that court found that "[a]lthough the husband had minimum contact with Florida, the statutory criteria was not met as he neither maintained a matrimonial domicile nor resided in this state before or at the time the wife commenced this action.'' Dunlop, 564 So.2d at 619 This Court has found that the statutory criteria of section 48.193(2), as well as the constitutional principles, have been met. Plaintiffs also cite Kulko v. Superior Court, 436 U.S. 84. 93. 98 S.Ct. 1690, 56 L.Ed.2d 132 (1978). in which the Supreme Court held that jurisdiction premised on 3-day and 1-day stopovers "would make a mockery of" due process limitations on the assertion of personal jurisdiction. Unlike the defendant in Kulko, Defendant Sanchez, de Lozada's visits constituted more than mere stopovers in Florida. In (act the record suggests that Defendant made at least 23 trips to Florida and spent at leas, 89 days in the state.
Plaintiffs also argue that Defendant's purchases of legal and investment advisory services from business with offices in Miami are insignificant. To support this argument, Plaintiffs cite Helicopteros Nacionales de Colombia, S.A. v. Hall 466 U.S. 408, 417, 104 S.Ct. 1868, 80 Ltd.2d 404 (U.S. 1984), where that court noted that "purchases and related trips, standing alone, are not a sufficient basis for a States assertion of jurisdiction." In that case, Helicol's chief executive officer made one trip to Houston for the purpose of negotiating the transportation-services contract and the court held that the one trip and purchase cannot be regarded as contact of a "continuous and systematic" nature. In this instant action, Defendant made more than one trip or even one purchase. Not only does the evidence support that Defendant made several trips to Florida, on different occasions, but the record also demonstrates that Defendant has had Florida attorneys under active retainer since 2003, and he has expended at least $226,000 in legal fees in Florida. Defendant has also contracted with investment advisors in Florida to manage his personal investments.
With respect to Defendant's bank account in Florida, Plaintiffs cite La Reunion Francaise v. La Costena, 818 So.2d 657, 659 (Fla. 3rd DCA 2002), for the proposition that maintaining a bank account is not sufficient to establish personal jurisdiction. In that case, the defendant's sole contact with Florida was the maintenance of a Florida bank account. Here, Defendant's primary bank account in Florida is just one of the several contacts Defendant has maintained with Florida. While the Court notes that "the bank account[ ] alone is insufficient to sustain a finding of personal jurisdiction, [it is] one indication of minimum contacts." Stubbs v. Wyndham Nassau Resort & Crystal Palace Casino, 447 F.3d 1357, 1363 n. 5 (11th Cir. 2006).
[12] While the Court has independently found that the due process requirements of minimum contacts have been satisfied, the Court must also note that Florida courts have held that the minimum contacts requirement is satisfied if Defendant's activities meet the requirements of section 48.192(2). See Woods v. Nova Cos. Belize Ltd., 739 So.2d 617, 620 (Fla. 4th DCA 1999) ("Because section 48.193(2) requires this high threshold, if the defendant's activities meet the requirements of section 48.193(2), minimum contacts is also satisfied."); see also Hatfield v. AutoNation, Inc., 915 So.2d 1236, 1242-43 (Fla. 4th DCA 2005) (same).
[13] During the Motions Hearing, counsel for Plaintiffs continually stated that there is no reason for this Court to create new law on general jurisdiction. This Court must note that its ruling is not only in line with the wellestablished law of general jurisdiction and rulings of Florida courts on this issue, but it is also consistent with the spirit and intent of "systematic and continuous" contacts required for the exercise of general jurisdiction under the Due Process clause.
[14] During the Motions Hearing, the Court noted that many of the convenience factors weighed in favor of a transfer, specifically conserving judicial resources and avoiding duplicative litigation of virtually identical cases. The Court informed the parties that, based on those factors, it will likely transfer this action if the Court found that the Southern District of Florida could exercise personal jurisdiction over Defendant.
[15] Defendant claims that Plaintiffs' Complaints against Defendants in both this action and the Florida action hint at having the same witnesses, all of whom live in Bolivia. Both Complaints lists the following people: Alejandro Apaza Huallpa, Father Modesto Chino Mamani, then-Vice President Carlos Mesa. It is obvious from the pleadings that most of the evidence and witnesses are to be found in Bolivia.
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NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS JUL 13 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
THE BANK OF NEW YORK MELLON, No. 19-16281
FKA Bank of New York, as Trustee for the
Certificateholders of The CWABS, Inc., D.C. No.
Asset-Backed Certificates, Series 2006-4, 2:17-cv-03084-MMD-NJK
Plaintiff-Appellee,
MEMORANDUM*
v.
886 PARK WALK TRUST,
Defendant-Appellant,
and
OAK PARK HOMEOWNERS
ASSOCIATION; ABSOLUTE
COLLECTION SERVICES, LLC,
Defendants.
Appeal from the United States District Court
for the District of Nevada
Miranda M. Du, Chief District Judge, Presiding
Submitted July 9, 2020**
Seattle, Washington
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
Before: HAWKINS, D.M. FISHER,*** and M. SMITH, Circuit Judges.
886 Park Walk Trust (the “Trust”) challenges the district court’s adverse grant
of summary judgment declaring that the Trust purchased property located at 886
Park Walk, Las Vegas, Nevada subject to a deed of trust held by the Bank of New
York Mellon (“BNY”). We have jurisdiction under 28 U.S.C. § 1291 and affirm.
The Trust’s sole contention on appeal is that BNY’s claim is barred by a three-
year statute of limitations. The Trust concedes, however, that it failed to raise its
statute of limitations defense in district court. We may consider an issue raised for
the first time on appeal under certain “exceptional circumstances,” AlohaCare v.
Hawaii, Dep’t of Human Servs., 572 F.3d 740, 744–45 (9th Cir. 2009), but this case
does not present such circumstances.
AFFIRMED.
***
The Honorable D. Michael Fisher, United States Circuit Judge for the
U.S. Court of Appeals for the Third Circuit, sitting by designation.
2 19-16281
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283 F.2d 881
Oswald RENDON, Plaintiff-Appellant,v.Jean GOLDNER, Defendant-Appellee.
No. 69, Docket 26172.
United States Court of Appeals Second Circuit.
Argued Nov. 2, 1960.Decided Dec. 1, 1960.
Landes & Wingate, Brooklyn, for plaintiff-appellant. Benjamin H. Siff, New York City, of counsel.
Reilly & Reilly, New York City, for defendant-appellee. John G. Reilly and Harold V. McCoy, New York City, of counsel.
Before SWAN, CLARK and MEDINA, Circuit Judges.
PER CURIAM.
1
Plaintiff and defendant were counsellors lors at a summer camp for children. On the evening of July 27, 1957 they took a drive in defendant's open sports car. She drove and he was a passenger sitting at her right. While proceeding on Bradley Parkway, an unlighted two-lane macadam road, in Blauvelt, N.Y., the car failed to make a left-hand curve, ran off the road, and overturned, causing injuries to the plaintiff. At the trial Judge Dimock submitted to the jury the issues of defendant's negligence and plaintiff's contributory negligence. The jury returned a verdict in favor of the defendant. As federal jurisdiction rests on diversity, New York law controls.
2
The appellant's principal contention is that there was no evidence of contributory negligence and therefore it was reversible error to submit that issue to the jury. Plaintiff claimed that the accident occurred because of the negligence of the defendant in driving too fast, in failing to apply her brakes in time, and in failing to use high beam lights on the unlighted road. She admitted her speed was 30 to 35 miles, that she was only 50 feet from the curve when she applied the brakes, and that her low beam lights were on from the time she entered Bradley Parkway to the place of the accident. This distance she said was between 500 and 650 feet. But plaintiff's witness, policeman Lenahan, testified that the distance was half a mile. Besides contending that there was oil on the road (denied by the policeman) which caused her car to skid, she argued that if she was negligent the plaintiff was contributorily negligent in failing to protest against the negligent manner of her driving. The judge called the jury's attention to this claim and charged: 'Failure to protest where there was an opportunity to do so may be considered by you as evidence of contributory negligence.' Plaintiff said that when the car entered Bradley Parkway it was so dark that he 'couldn't see too far.' This, according to the policeman, was half a mile from the accident. Under New York law a plaintiff has the burden of proving that he was not contributorily negligent. Fitzpatrick v. International Ry. Co., 252 N.Y. 127, 169 N.E. 112, 68 A.L.R. 801. This court cannot rule, as a matter of law, that the appellant sustained that burden. Whether plaintiff's failure to protest constituted contributory negligence was, in our opinion, a jury question. As the court stated in Nelson v. Nygren, 259 N.Y. 71, 75, 181 N.E. 52, 54: 'The question of contributory negligence ordinarily is a question of fact.'
3
Appellant contends also that it was error to permit the reporter to enter the jury room and read the court's charge, which they asked to have repeated. Plaintiff's attorney at first stated he had no objection to this procedure; but later he suggested that the jury should be cautioned not to converse with the reporter and said: 'I think that is the only danger involved.' The court did caution them, and the attorney made no further objection. Under the circumstances disclosed by the record we see no error in the procedure.
4
Judgment affirmed.
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NOT FOR PUBLICATION
UNITED STATES COURT OF APPEALS FILED
FOR THE NINTH CIRCUIT MAR 26 2015
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
SERGIO DE JESUS ARRIOLA- No. 11-73220
CARRILLO, AKA Sergio Arriola-Carrillo,
AKA Sergio Arriola-Carrio, Agency No. A070-031-599
Petitioner,
MEMORANDUM*
v.
ERIC H. HOLDER, Jr., Attorney General,
Respondent.
On Petition for Review of an Order of the
Board of Immigration Appeals
Argued and Submitted February 12, 2015
Pasadena, California
Before: CALLAHAN, WATFORD, and OWENS, Circuit Judges.
Sergio de Jesus Arriola-Carrillo was convicted of soliciting the commission
of a drug offense. Cal. Penal Code § 653f(d)(1). Such a conviction ordinarily
renders an alien inadmissible. See 8 U.S.C. § 1182(a)(2)(A)(i)(II). Arriola-
Carrillo argues that because his state-court solicitation conviction was later
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
Page 2 of 2
expunged, the Federal First Offender Act, 18 U.S.C. § 3607(a), prevents that
conviction from serving as the basis of any adverse immigration consequence.
Arriola-Carrillo does not qualify for FFOA treatment. The FFOA applies
only to those convicted of simple possession or a lesser offense. Nunez-Reyes v.
Holder, 646 F.3d 684, 695 (9th Cir. 2011) (en banc). Solicitation is not a lesser
offense. Because it does not share the same elements as the federal crime of
simple possession, solicitation is “qualitatively different from any federal
conviction for which FFOA treatment would be available.” Id. Further, like the
crime of being under the influence in Nunez-Reyes, solicitation may “carr[y] an
immediate risk of dangerous behavior, which mere possession does not necessarily
create.” Id. The drug trade is notoriously violent, and transactions between would-
be buyers and would-be sellers can escalate into dangerous confrontations. Mere
possession, by contrast, does not necessarily pose such risks, as the Nunez-Reyes
court observed. Id.
The BIA correctly concluded that Arriola-Carrillo is ineligible for FFOA
treatment. The BIA was therefore also correct that although Arriola-Carrillo’s
conviction was expunged, it nonetheless “remains for immigration purposes,”
rendering Arriola-Carrillo inadmissible and ineligible for adjustment of status.
PETITION DENIED.
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6 Ill. App.3d 1094 (1972)
287 N.E.2d 141
In re ESTATE OF DORA NEWCOMB, Deceased.
No. 71-116.
Illinois Appellate Court Third District.
August 17, 1972.
*1095 Kavanagh, Scully, Sudow, White & Frederick, of Peoria, (Daniel W. Hardy, of counsel,) for appellant.
Robert L. Silberstein, of Peoria, for appellee.
Reversed and remanded.
Mr. JUSTICE SCOTT delivered the opinion of the court:
This is an appeal from an order of the circuit court of the Tenth Judicial Circuit of Illinois, Tazewell County, overruling the objection by the administrator of the estate of Dora Newcomb, deceased, to a claim filed more than seven months after the issuance of the Letters of Administration for the following reasons:
(a) an alleged forbearance of claimants' filing of a claim because of alleged conduct on the part of the estate in connection with such claim; and
(b) the filing of the estate inventory one day before the expiration of seven months after the issuance of Letters of Administration.
This matter arises out of an alleged breach of Agreement for Warranty Deed by decedent. After the appointment of an administrator, the administrator's attorney corresponded with the attorney for the claimants. Various correspondence discussed responsibility under the contract, stated that the matter could be worked out, inferred authorization for *1096 certain expenditures to preserve the property, provided for insurance on the property and offered a compromise settlement.
An inventory was filed in the estate one day before the expiration of seven months after the issuance of the Letters of Administration. Thereafter the offer of compromise was withdrawn and a claim was filed against the estate of Dora Newcomb. The claim did not specify any details. The trial court considered that it referred to a claim for damages arising out of the purported breach of the Agreement for Warranty Deed. The administrator of the estate of Dora Newcomb, deceased, filed an objection to the claim, on the grounds that the claim date had passed prior to the filing of the claim. The court overruled the objection of the administrator of the estate of Dora Newcomb, deceased, and granted leave for this appeal.
1 On appeal claimants for the first time raised the issue that part of the claim may be for legitimate expenses of administration and not necessarily for breach of the Agreement for Warranty Deed. We find nothing in the record to indicate that this question was raised in the lower court. Expenses of administration are specifically exempted from the limitation on payment of claims contained in Illinois Revised Statutes 1969, Chapter 3, Section 204. Claimants should present to the lower court that portion of the claim that they now maintain is a legitimate expense of administration for determination by that court. We consider only whether the actions of the administrator of the estate, through her attorney, waive the requirements for a claim for breach of Agreement for Warranty Deed to be filed within seven months from issuance of the Letters of Administration as to assets which were inventoried within seven months from the issuance of Letters of Administration.
Illinois Revised Statutes 1969, Chapter 3, Section 204, states:
"All claims against the estate of a decedent, except expenses of administration and surviving spouse's or child's award, not filed within 7 months from the issuance of letters testamentary or of administration, are barred as to the estate which has been inventoried within 7 months from the issuance of letters."
2 It has been generally recognized that this statute is not a general statute of limitation. Rather, it is a specific act adopted for the purpose of facilitating early settlement of estates, and a failure to file a claim within a statutory period bars the claim from participating in the inventoried assets of the estate. In re Baker's Estate, 48 Ill. App.2d 442, 199 N.E.2d 307.
Morse v. Pacific Ry. Co., 191 Ill. 356, 61 N.E. 104, holds that knowledge of a claim by the executor does not remove the requirement that the *1097 claim be filed in accordance with the statute. Further, an executor or administrator cannot waive the statute (In re Baker's Estate, 48 Ill. App.2d 442, 199 N.E.2d 307; Austin v. City Bank of Milwaukee, 288 Ill. App. 36, 5 N.E.2d 585), nor can the doctrine of estoppel be applied. In re Baker's Estate, 48 Ill. App.2d 442, 199 N.E.2d 307.
The claimants cite several new decisions and urge that they show a trend against the strict enforcement of statutory requirements on the bringing of certain actions and that this trend should be expanded to the factual situation in this case. The cases are Housewright v. City of LaHarpe, 282 N.E.2d 437, and Sullivan v. Midlothian Park District, 281 N.E.2d 659. Both cases deal with statutory regulation of suits against municipal corporations. Both cases granted apparent waivers of certain requirements of the statute governing the bringing of the suits. However, in both instances the waivers were based on statutory authority. In the absence of statutory authority for a waiver of the non-claim statute, we find nothing in these cases applicable to this factual situation.
3 We therefore conclude that the filing of the claim within the period specified by statute is mandatory and cannot be waived by the administrator, the conduct of the administrator or her attorney in this case, or by the court.
For the reasons given, the order of the circuit court overruling the objection to the claim as filed is reversed and this cause is remanded with directions to bar the claim, as filed, as against assets inventoried within seven months and for further hearings in connection with any additional assets that may have been inventoried after the filing of the claim together with the claimants' contention as to that part of the claim that may represent legitimate expenses of administration.
Reversed and remanded with directions.
STOUDER, P.J., and DIXON, J., concur.
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306 Pa. Superior Ct. 222 (1982)
452 A.2d 524
Kevin CASSIDY, in his own behalf and in behalf of others similarly situated, Appellant,
v.
MONTGOMERY COUNTY, William T. Nicholas, District Attorney of Montgomery County, John J. Newett, Clerk of Courts of Montgomery County.
Superior Court of Pennsylvania.
Argued June 10, 1980.
Filed November 5, 1982.
Petition for Allowance of Appeal Denied February 17, 1983.
*224 Martin J. Cunningham, Jr., Norristown, for appellant.
Logan M. Bullitt, IV, Norristown, for appellees.
Before PRICE, WICKERSHAM and LIPEZ, JJ.
PRICE, Judge:
On April 5, 1977, appellant, Kevin Cassidy, was placed in the Accelerated Rehabilitative Disposition ("A.R.D.") program in Montgomery County. After a hearing, and pursuant to Pa.R.Crim.P. 175 et seq., the court ordered that further proceedings be deferred, conditioned upon a two year period of probation, payment of the costs of prosecution, *225 and payment of $300.00 "in restitution to the County for the cost of superintending the conditions." (R. 16a). Appellant and his attorney agreed to these conditions at the hearing. On April 2, 1979, Mr. Cassidy petitioned the court to dismiss all criminal charges against him, contending that he had successfully performed all of the conditions of the A.R.D. order, and on April 4, 1979, the court ordered that the charges be dismissed.
Three weeks later, appellant filed this class action in equity, contending that the imposition and collection of the $300.00 amount by Montgomery County and the other appellees was in violation of Pa.R.Crim.P. 182(a), which prohibits the conditioning of an A.R.D. order upon payment of a fine. He seeks recovery for himself and all others who have paid such sums to Montgomery County as conditions of A.R.D., together with interest from the date of payment. He also seeks injunctive relief against the district attorney, as well as attorney's fees and costs.
Appellees filed preliminary objections in the nature of a motion to strike and a demurrer, contending, inter alia, that the $300.00 collected was not a fine in violation of Rule 182(a), but rather a payment to the use of the county, and as such a permissible condition of A.R.D. Appellees' preliminary objections were sustained by a court en banc, and the complaint dismissed for failure to state a cause of action.[1]
Appellant maintains that a cost to the use of the county is not a permissible condition of A.R.D. under Rule 182(a), and also argues that in characterizing the $300.00 payment as a cost to the use of the county, rather than a fine, the court below improperly resolved a question of fact against him to *226 grant a demurrer. We disagree with both contentions and affirm.
Pa.R.Crim.P. 182(a) provides:
The conditions of the program may be such as may be imposed with respect to probation after conviction of a crime, including restitution and costs, and may include other conditions agreed to by the parties, except that a fine may not be imposed.
At the time this rule was adopted (Rule 182 became effective May 24, 1972), a body of case law existed to the effect that a fine could not be imposed as a condition of probation. Commonwealth v. Martin, 262 Pa.Superior Ct. 113, 119-120 n. 7, 396 A.2d 671, 674 n. 7 (1978); Commonwealth v. Rooney, 233 Pa.Superior Ct. 225, 335 A.2d 710 (1975); Commonwealth v. Peterson, 172 Pa.Superior Ct. 341, 94 A.2d 582 (1953). The rationale for this principle was that since a fine was deemed a sentence, the imposition of a prison term upon revocation of probation, would constitute an illegal imposition of two sentences for the same offense. Commonwealth v. Ferguson, 201 Pa.Superior Ct. 649, 193 A.2d 657 (1963); Commonwealth v. Peterson, 172 Pa.Superior Ct. at 345, 94 A.2d at 582.
Thus, the Act of June 19, 1911, P.L. 1055, as amended, 19 P.S. § 1051 (1964), in effect at the time of the adoption of Rule 182, which provided for terms and conditions of probation, including expressly "the payment of money for the use of the county," specified that such a condition not be considered as the imposition of a fine or sentence. The cases under this statute upheld costs to the use of the county as conditions of probation, finding that such payments did not constitute fines and were not, therefore illegal. Commonwealth v. Martin, 262 Pa.Superior Ct. at 119-120 n. 7, 396 A.2d at 674 n. 7); Commonwealth v. Rooney, 233 Pa.Superior Ct. at 228-29, 335 A.2d at 712; Commonwealth ex rel. Kosele v. Keenan, 178 Pa.Superior Ct. 461, 116 A.2d 314 (1955).
Appellant argues that it is significant that the successor provision to 19 P.S. § 1051, 18 Pa.C.S. § 1354, in *227 effect at the time Mr. Cassidy was placed on A.R.D.,[2] does not specifically list the payment of money to the use of the county as a permissible condition of an order of probation.[3] This argument overlooks 18 Pa.C.S. § 1354(c)(13), which states that as a condition to its order of probation the court may require a defendant "to satisfy any other conditions reasonably related to the rehabilitation of the defendant and not unduly restrictive of his liberty or incompatible with his freedom of conscience." This provision indicates that it is not necessary that a condition be specifically enumerated in the statute to be a valid condition of probation, but rather that the court has considerable discretion to fashion conditions appropriate to a particular case. Commonwealth v. Walton, 483 Pa. 588, 598, 397 A.2d 1179, 1184-85 (1979). Further, the language of Rule 182(a) affords even greater latitude for the design of an individualized A.R.D. program. An A.R.D. order may contain not only such conditions "as may be imposed with respect to probation after conviction of a crime," but also "may include other conditions agreed to by the parties." The only exception is the imposition of a fine.
Appellant argues that the exclusion of fines in Rule 182 reflects a determination by the Supreme Court that any payment other than restitution or the costs of prosecution could not serve a rehabilitative purpose in the context of A.R.D. We cannot agree. At the time the rule was adopted fines were not permissible in connection with probation because of the double sentence problem, not because of any lack of rehabilitative function. Further, at that time, costs to the use of the county were permissible conditions for probation. Had the Supreme Court intended to exclude such costs as conditions of A.R.D., the rule could easily have been drafted to do so specifically. The case law clearly *228 indicates that a payment to the use of the county is not a fine, and is therefore not prohibited by Rule 182(a).
Appellant's contention that the lower court improperly resolved a question of fact against him in characterizing the $300.00 sum as a cost to the use of the county, rather than as a fine, is also without merit. The record clearly shows that the A.R.D. order required the payment of $300.00 "in restitution to the county for the cost of superintending the conditions." (R. 16a).[4] While it is true that all well pleaded facts and reasonable inferences therefrom must be resolved against granting a demurrer, Hoffman v. Misericordia Hospital of Philadelphia, 439 Pa. 501, 267 A.2d 867 (1970), a demurrer does not admit conclusions of law. Eden Roc Country Club v. Mullhauser, 416 Pa. 61, 204 A.2d 465 (1964); Hoffman, supra. Appellant's characterization of the $300.00 payment to the county for the cost of superintending the program as a "fine" presents no question for determination of fact. The question of whether such a payment constitutes a fine is ultimately one of law, as the cases dealing with such payments in the context of probation clearly illustrate. The court below properly concluded as a matter of law that such a payment does not constitute a fine in violation of Pa.R.Crim.P. 182(a).[5]
*229 Accordingly, the order sustaining appellees' preliminary objections and dismissing appellant's complaint is affirmed.
NOTES
[1] Appellees also raised issues as to Mr. Cassidy's representation of the class as defined in his complaint, as well as asserting that appellant was guilty of laches and that he had an adequate remedy at law. The court below did not consider these questions. The decision was based solely on the ground that the $300.00 payment was not a fine, and that, therefore, appellant's complaint did not state a cause of action.
[2] Commonwealth v. Walton, 483 Pa. 588, 600 n. 16, 397 A.2d 1179, 1185 n. 16 (1979). This successor provision became effective on March 30, 1975.
[3] Under 18 Pa.C.S. § 1354(c)(11), it is specified that a fine may be imposed as a condition of probation.
[4] We see no merit in appellant's contention that the handwritten words "fine and costs forthwith" appearing above Judge Moss's signature on the A.R.D. order (R. 16a), raise a question as to whether the $300.00 amount was actually a payment to the county for the cost of superintending the conditions of the program. Such an abbreviated notation refers only to the proper time for the payments required by, and specifically listed in an order.
[5] Appellant's belated assertion that the $300.00 sum might not reflect the actual cost of superintending the program is misplaced. Mr. Cassidy and his attorney, Martin J. Cunningham, Jr., who also represents him in this matter, agreed to the $300.00 figure in negotiations with the district attorney and at the hearing at which the A.R.D. order was granted. Appellant obtained dismissal of criminal charges upon completion of his program without ever questioning whether the amount was appropriate. We fail to see why, three weeks after obtaining the benefits of his agreement, he should have been permitted to argue that the figure was arbitrary and therefore ought to be deemed a "fine". Rather, appellant has waived any objections to the amount of his payment to the county, having accepted the full benefits of the A.R.D. agreement. See Commonwealth v. Walton, 483 Pa. 588, 600, 397 A.2d 1179, (1979) (defendant's failure to object to the amount of restitution ordered as arbitrary at his sentencing hearing held a waiver of this issue, where the court had legal authority to enter a restitution order). See also, Commonwealth v. Preston, 488 Pa. 311, 319 n. 3, 412 A.2d 524, 528 n. 3 (1980); Commonwealth v. Shoemaker, 462 Pa. 342, 343, 341 A.2d 111 (1975).
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 03-7352
LEROY S. DOTSON, JR.,
Plaintiff - Appellant,
versus
TOMLIN FERGUSON, Former Plant Manager; RICKY
JOHNSON, Plant Manager; MARK ALLEN,
Superintendent; ROB OLSON, Matt Build
Supervisor,
Defendants - Appellees.
Appeal from the United States District Court for the District of
Maryland, at Greenbelt. Deborah K. Chasanow, District Judge. (CA-
03-1183-DKC)
Submitted: December 18, 2003 Decided: January 15, 2004
Before LUTTIG, SHEDD, and DUNCAN, Circuit Judges.
Dismissed by unpublished per curiam opinion.
Leroy S. Dotson, Jr., Appellant Pro Se.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Leroy S. Dotson, Jr., seeks to appeal the district
court’s order dismissing his action brought pursuant to 42 U.S.C.
§ 1983 (2000). We dismiss the appeal for lack of jurisdiction
because the notice of appeal was not timely filed.
Parties in a civil action where the United States is not
a party, are accorded thirty days after the entry of the district
court’s final judgment or order to note an appeal. Fed. R. App. P.
4(a)(1)(A). However, a court may extend the appeals period for
fourteen days upon a party’s timely motion to reopen the appeal
period. Fed. R. App. P. 4(a)(6). This appeal period is “mandatory
and jurisdictional.” Browder v. Director, Dep’t of Corr., 434 U.S.
257, 264 (1978) (quoting United States v. Robinson, 361 U.S. 220,
229 (1960)).
The district court’s order reopening the time for Dotson
to file a notice of appeal was entered on the docket on July 7,
2003, affording Dotson until July 21, 2003, to file a notice of
appeal. Fed. R. App. P. 4(a)(6). However, Dotson’s notice of
appeal was dated August 20, 2003, and filed on August 21, 2003.
Because Dotson failed to file a timely notice of appeal within the
extended fourteen-day appeal period, we dismiss the appeal for lack
of jurisdiction. We dispense with oral argument because the facts
- 2 -
and legal contentions are adequately presented in the materials
before the court and argument would not aid the decisional process.
DISMISSED
- 3 -
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29 F.3d 641
Harmonv.Thomas*
NO. 93-8369
United States Court of Appeals,Eleventh Circuit.
July 21, 1994
1
Appeal From: N.D.Ga.
2
AFFIRMED.
*
Fed.R.App.P. 34(a); 11th Cir.R. 34-3
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09/08/2017
IN THE COURT OF CRIMINAL APPEALS OF TENNESSEE
AT NASHVILLE
Assigned on Briefs August 8, 2017
JEFFREY KING v. STATE OF TENNESSEE
Appeal from the Circuit Court for Sumner County
No. 2-2015 Dee David Gay, Judge
___________________________________
No. M2016-02166-CCA-R3-PC
___________________________________
The petitioner, Jeffrey King, pleaded guilty to multiple drug and money laundering
crimes, and the trial court sentenced him to forty years of incarceration to be served at
100%. The petitioner attempted to reserve certified questions of law pursuant to
Tennessee Rule of Criminal Procedure 37(b)(2) about whether wiretaps used in the
investigation of the crime were lawful. This Court determined that the petitioner was not
entitled to relief on the basis of the certified questions and affirmed the judgments on
appeal. State v. King, 437 S.W.3d 856, 889 (Tenn. Crim. App. 2013). In 2015, the
petitioner filed a petition for post-conviction relief, claiming that he received the
ineffective assistance of counsel and, after a hearing, the post-conviction court denied
relief. After review, we affirm the post-conviction court’s judgment.
Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Criminal Court Affirmed
J. ROSS DYER, J., delivered the opinion of the court, in which ROBERT W. WEDEMEYER
and D. KELLY THOMAS, JR., JJ., joined.
Manuel B. Russ, Nashville, Tennessee, for the appellant, Jeffrey Kristopher King.
Herbert H. Slatery III, Attorney General and Reporter; Leslie E. Price, Assistant Attorney
General; Lawrence Ray Whitley, District Attorney General; and Brent C. Chery,
Assistant District Attorney General, for the appellee, State of Tennessee.
OPINION
I. Facts and Procedural History
The facts underlying this case encompass numerous charges against the petitioner
and his co-defendants for possession and sale of marijuana, money laundering, and
possession of firearms in Davidson, Sumner, and Rutherford counties.1 The petitioner
was represented by different attorneys in each county and pleaded guilty to varying drug
and money laundering offenses in each county.
A. Trial
On direct appeal, this Court summarized the factual and procedural background of
the case for each of the three counties. We include that which is relevant to this appeal:
On October 7, 2008, Phillip L. Taylor, state investigator for the 20th
Judicial District Drug Task Force of Nashville, Davidson County,
Tennessee, filed in the Criminal Court for Davidson County, Tennessee, an
Application for Interception of Wire and Electronic Communications for
the interception of communications through telephone line [(XXX)-XXX]-
7591 “used by Bruce Dady” (“the First Dady Application” and “the First
Dady Number”). The First Dady Application is 59 pages long and consists
of 271 numbered paragraphs containing the sworn averments of Officer
Taylor. The identified “concern” of the First Dady Application was “the
delivery, sale, or possession with intent to sell or deliver, 700 pounds or
more of any substance containing marijuana, and conspiracy to commit the
same” (“the Target Crimes”). The First Dady Application identified the
following individuals as participants in the Target Crimes: Vernon E.
Lockhart, Bruce A. Dady, the [petitioner and his co-defendants], . . .
(collectively, “the Target Subjects”). . . . .
Also on October 7, 2008, Officer Taylor filed in the Criminal Court
for Davidson County, Tennessee, an Application for Interception of Wire
and Electronic Communications for the interception of communications
through telephone line [(XXX)-XXX]-5541 “subscribed to by Cassie T.
Roark” but “believed to be used primarily by [the petitioner]” (“the King
Application”). The King Application is 60 pages long, consists of 275
numbered paragraphs, and is substantially similar to the First Dady
Application.
....
On October 7, 2008, the Criminal Court for Davidson County, the
Hon. Mark Fishburn (“the Issuing [c]ourt”), granted the First Dady
Application, the King Application. . . and issued as to each Application an
1
Additional charges in Wilson and Cheatham Counties were dismissed.
-2-
Order Authorizing the Interception of Wire and Electronic
Communications, a ten-page document. Each Order contains the following
findings:
4. There is probable cause to believe that [the Target
Subjects] have committed, and will continue to commit, the
offenses of delivery, sale, or possession with intent to sell or
deliver, 700 pounds or more of any substance containing
marijuana, and conspiracy to commit same.
....
5. There is probable cause to believe that the telephone
assigned phone number [(XXX)-XXX]-5541, a telephone
service provided by Verizon Wireless, . . . subscribed to by
Cassie T. Roark at 1636 Stokley Lane, Old Hickory,
Tennessee, believed to be used by [the petitioner], Target
Subject, in connection with the commission of the above
described offense [sic].
....
6. There is probable cause to believe that the communications
to be intercepted will concern the telephone numbers
associated with the Target Subjects, and the dates, times, and
places for commission of the aforementioned offense when
the Target Subjects communicate with their coconspirators,
associates and other participants in the conspiracy, thereby
identifying the co-conspirators and others as yet unknown. In
addition, these communications are expected to constitute
admissible evidence of the above described offense.
7. It has been established adequately that normal investigative
procedures have been tried and have failed, reasonably appear
to be unlikely to succeed if tried, or are too dangerous to
employ.
...
Applications for additional wiretaps and for extensions of the
wiretaps previously authorized ensued over the period from October 10,
-3-
2008 through late March 2009. The Issuing court granted all of the State’s
applications, resulting in the electronic surveillance of a total of twenty-
three telephones. The involved phone numbers were monitored for several
months for evidence related to the Target Crimes.
In 2009, the [petitioner and his co-defendants] were indicted in
several Middle Tennessee counties on multiple charges including drug and
money-laundering offenses. In the Sumner County and Davidson County
cases, the [petitioner and his co-defendants] each filed a motion to suppress
the evidence gleaned from the wiretaps. [The petitioner] also filed a motion
to suppress the evidence gleaned from the wiretaps in the Rutherford
County case. Each of the trial courts held an evidentiary hearing and
subsequently issued orders denying the [petitioner’s and his co-defendants’]
motions.
Thereafter, [the petitioner] entered conditional guilty plea in Sumner
. . . county, as follows:
Sumner County: One count of conspiracy to possess over
seventy pounds of marijuana, a Class B felony, with a
sentence of twenty years in the TDOC; three counts of the
delivery of over ten pounds of marijuana, a Class D felony,
with concurrent sentences of six years’ incarceration for each
offense; one count of the possession of over seventy pounds
of marijuana, a Class B felony, with a consecutive sentence of
twenty years in the TDOC; one count of possessing a firearm
during the commission of a felony, a Class E felony, with a
concurrent sentence of two years’ incarceration; and seven
counts of money-laundering, a Class B felony, each with a
concurrent sentence of twenty years’ incarceration.
....
In conjunction with [his] plea, the [petitioner] reserved the following
certified questions of law:
In the trial court, the [petitioner] moved to suppress the
fruits of electronic surveillance on numerous grounds: (1) that
the initial wiretap Applications lacked probable cause to
justify interception in violation of T.C.A. §§ 40-6-304(c) and
40-6-305, specifically including the Applications’ failure to
-4-
demonstrate the statutorily required nexus between the phone
to be intercepted and the alleged illegal activity sought to be
intercepted; (2) that the initial Applications failed to
demonstrate a constitutionally sufficient requisite necessity
for the use of electronic surveillance pursuant to T.C.A. § 40-
6-304(a)(3) and 18 U.S.C. § 2518(1)(c); (3) that all
subsequent wiretaps were the fruits of the prior illegal wiretap
interceptions and therefore, were fruits of the poisonous tree;
(4) that the notarized but unsigned affidavit requesting a
second extension of the wiretap for telephone number (615)
584-6075 was statutorily deficient to support interception; (5)
that, in addition to being a fruit of the prior illegal
interceptions, the subsequent interception of telephone (615)
653-2294 lacked probable cause to justify interception in
violation of T.C.A. §§ 40-6-304(c) and 40-6-305 because they
[sic] failed to make a sufficient link between the phone and
suspected criminal activity or the targets of the investigation;
(6) that, in addition to being a fruit of the prior illegal
interceptions, the subsequent interception of telephone (615)
818-2839 lacked probable cause to justify interception in
violation of T.C.A. §§ 40-6-304(c) and 40-6-305 because they
[sic] failed to make a sufficient link between the phone and
suspected criminal activity or the targets of the investigation;
(7) that the Applications for extensions of the wiretaps failed
to articulate a statutorily sanctioned purpose justifying
continuing interception; (8) that the issuing Court neglected
its duty as a neutral and detached magistrate and acted as an
impermissible rubber stamp for law enforcement; and, (9) that
the Applications contain omissions and material
misstatements that undercut any showing of requisite
necessity for the wiretaps.
The [petitioner] timely appealed from [his] convictions, and this
Court ordered that the appeals from the judgments of conviction entered in
the Rutherford County, Davidson County, and Sumner County prosecutions
be consolidated.
King, 437 S.W.3d at 860-64 (footnotes omitted). On appeal, this Court determined that
the petitioner was not entitled to relief on the basis of the certified questions of law. It
concluded that several of the questions were not dispositive, limiting review to: whether
the wiretap applications provided a substantial basis for probable cause in accordance
-5-
with the standard recited at Tennessee Code Annotated section 40-6-304(c)(4);2 whether
the wiretap applications satisfied the requisite necessity requirement found at section 40-
6-304(a)(3); if the wiretap applications contained errors that invalidated the applications’
validity; and whether subsequent wiretaps, after the wiretap of the initial phone, were
“illegal as fruits of the poisonous tree.” Id. at 870-86. This Court declined to rule on the
remaining questions, stating “[the petitioner] fails to explain how, in light of the State’s
other evidence, [his] convictions must be reversed and [his] cases dismissed were we to
determine that the Issuing court erred in granting the Allegedly Invalid Applications.” Id.
at 888. For this reason, this Court deemed the petitioner’s remaining certified questions
of law not dispositive. Id. at 886-89. Accordingly, the convictions in each county were
affirmed. Id. at 889.
B. Post-Conviction Proceedings
The petitioner then filed a petition for post-conviction relief, pro se, in which he
alleged that he had received ineffective assistance of counsel and that his guilty pleas
were not knowingly and voluntarily entered.3 He argued that counsel was ineffective for
failing to address on appeal the legality of Tennessee Code Annotated section 40-6-
304(c)(2). He further argued that he entered his guilty pleas under the impression that his
nine certified questions would be addressed in turn by the appellate court, would be
deemed dispositive because of the agreement of the parties, and that a determination in
his favor on any of the questions would result in his convictions being reversed. The
post-conviction court appointed an attorney and subsequently held a hearing, during
2
In a footnote, this Court clarified that [a]lthough the first of the issues [in the] [petitioner’s]
certified questions refers specifically only to “the statutorily required nexus between the phone to be
intercepted and the alleged illegal activity sought to be intercepted,” the [petitioner clarifies] in [his] reply
brief that the “heart” of [his] probable cause challenge is that “[t]he State never conducted consensually
monitored and recorded calls to any of the target telephones to discuss any target offense or criminal
conduct.” That is, the [petitioner] contends that the State failed to satisfy the nexus requirement set forth
in subsection (c)(4) of the Wiretap Statute, which requires probable cause to believe that the targeted
telephone is “being used, or [is] about to be used, in connection with the commission of the offense.”
Tenn. Code Ann. § 40-6-304(c)(4). . . . Therefore, we decline to address any potential contention that
there was no “probable cause for belief that particular communications concerning [the] offense will be
obtained through the interception.” Tenn. Code Ann. § 40-6-304(c)(2).
3
The petitioner filed similar petitions for post-conviction relief in Davidson County and
Rutherford County. The petitioner appealed the post-conviction courts’ denial of his petition filed in
Davidson County and Rutherford County, and this court affirmed the post-conviction courts’ judgment.
See Jeffrey King v. State, M2016-01224-CCA-R3-PC (Tenn. Crim. App., at Nashville, June 28, 2017)
perm. app. filed (Tenn. Aug. 16, 2017); see also King v. State, M2016-01646-CCA-R3-PC (Tenn. Crim.
App. June 28, 2017) perm. app. filed (Tenn. Aug. 16, 2017).
-6-
which the petitioner, by agreement of the parties, submitted a transcript of the Davidson
County post-conviction proceedings as an exhibit in lieu of live testimony. The evidence,
summarized in our opinion affirming the Davidson County post-conviction court’s
judgment, is repeated here:
Counsel testified that she worked as a criminal defense attorney for fifteen years
and had handled hundreds of drug cases throughout her career. She stated that she had
dealt with eighty to one hundred cases that had wiretapping issues and that she had
“actively litigated” forty to fifty wiretap cases. She testified that she was “very
experienced” at the time she represented the petitioner. Counsel recalled that the
petitioner was charged in multiple counties and that she represented him in Sumner
County and assisted with his representation in the other counties (hereinafter “Sumner
counsel”). Sumner counsel was the petitioner’s primary attorney, and she stated that the
Sumner County case “took the lead” over the Rutherford County and Davidson County
cases.
Sumner counsel testified that she spent a “tremendous” amount of time with the
petitioner and had a very good working relationship with him. She was his “primary
point of contact” for his cases, and the majority of the litigation happened in Sumner
County where she represented him. Sumner counsel spoke with the attorneys in the
petitioner’s other cases, and they met jointly with the petitioner on occasion. Sumner
counsel described the petitioner as a “profoundly smart guy” who wanted to be involved
in his case and participate in his defense. As such, Sumner counsel had many discussions
with him about the litigation strategy over the course of an estimated seventy-five
meetings. Sumner counsel arranged for the petitioner to have access to a computer while
incarcerated on which he reviewed his discovery file. She felt that the petitioner “trusted
[Sumner counsel’s] judgment,” although she recalled that he had a somewhat strained
relationship with another of his attorneys.
Regarding the petitioner’s direct appeal, Sumner counsel testified that all of the
petitioner’s cases were consolidated and that she wrote the appellate brief and argued the
case. About the plea negotiations with the State, Sumner counsel recalled that the State
made an initial offer that “may have been forty [years] at thirty percent” but that a
certified question was not included in the deal. Lengthy negotiations followed because
the State insisted that the petitioner plead guilty in multiple counties, which Sumner
counsel felt was unnecessary and excessive. Sumner counsel also recalled that the State
made an offer in exchange for the petitioner’s cooperation as a witness, and the petitioner
did not want to cooperate.
Regarding the certified questions of law in relation to the wiretap issue, Sumner
counsel said that this was “incredibly important” to the petitioner because he felt very
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strongly that the wiretaps were unlawful. The petitioner understood, and the State
agreed, that without the wiretap evidence, the State’s case would essentially have to be
dismissed. As a result, the wiretap issue was also “incredibly important to [Sumner
counsel] legally.” She agreed that if the certified questions had not been a part of the plea
deal, the petitioner would not have accepted the deal. She stated that the “certified
question[s] were the enticing factor for that plea deal for [the petitioner].”
Turning back to her representation of the petitioner, Sumner counsel recalled that
she reviewed with the petitioner “every bit” of the discovery. Based on the State’s
evidence, she and the petitioner “knew collectively that if [he] went to trial [he was] in
trouble.” “[The petitioner’s] perspective, he knew that if he went to trial he would be
convicted.” Sumner counsel had prepared documentation of the petitioner’s maximum
potential exposure if he was convicted by a jury, and it was ninety years or more with
much of the sentence to be served at 100 percent because of school zone enhancements.
Sumner counsel stated:
[I]t was very important to [the petitioner] that the certified
question[s] be heard. And my advice would have been to him, although I
thought the [State’s] offer was terrible and I thought it was way too much
time in the case, . . . we didn’t have a lot of choices, those were our choices.
. . . . But with the certified question[s] I really felt strongly that he should
consider the offer. It gave him what he wanted, gave him the opportunity
to be heard on appeal on these issues, and it gave him some control of his
future in the sense of a definitive resolution.
Sumner counsel stated that she was not a “seller” of plea agreements and believed
that a case should go to trial if a defendant so desired. She stated that she never pressured
clients to give up their right to a trial. Concerning the motion to suppress, Sumner
counsel felt strongly that the wiretaps were unlawful and that everything that flowed from
the wiretaps should be suppressed. Sumner counsel recalled that she reviewed each
wiretap and made an independent judgment on each one as to whether to file a motion to
suppress.
Turning back to the certified questions of law, Sumner counsel recalled that she
was in discussion with the State for four to six weeks about the questions. She was “very
concerned about the trickiness of a certified question[s]” because the appellate court was
“notorious for finding ways not to hear certified questions,” and she told the petitioner
that she had been “a victim” of that occurrence on more than one occasion. As such,
Sumner counsel “cautioned” the petitioner about the “tricky process from a procedural
perspective.” The State agreed to the submission of certified questions of law, and the
State allowed Sumner counsel flexibility as to how to craft the questions. The petitioner
-8-
and Sumner counsel discussed the certified questions and what issues to include. Sumner
counsel “knew” that some of the nine questions were not dispositive, while some of the
others were. Sumner counsel explained the risk to the petitioner that the appellate court
might find certain ones were not dispositive and would decide not to rule on them for this
reason. She advised him that there was “an equal chance” that the appellate court would
go ahead and rule on the questions even if they were not dispositive. She testified,
however, that the main certified questions were dispositive, and if the appellate court
ruled in the petitioner’s favor on those main questions, the case would “disappear” for the
petitioner.
Sumner counsel acknowledged the complexities involved with certified questions
of law and stated that, even though she thought the petitioner was a very intelligent
person, she knew that the procedural process for review of certified questions was
difficult to understand. She took plenty of time to discuss the complexities with the
petitioner but could not say whether he was able to understand or absorb them. When
asked if Sumner counsel thought the petitioner might have gotten a different impression
than she had from their discussions, she replied, “It’s possible.”
About the first certified question, whether “the initial wiretap Applications lacked
probable cause to justify interception in violation of T.C.A. §§ 40-6-304(c) and 40-6-305,
specifically including the Applications’ failure to demonstrate the statutorily required
nexus between the phone to be intercepted and the alleged illegal activity sought to be
intercepted[,]” Sumner counsel agreed that the appellate court addressed this question but
declined to rule on several of the requirements of subsection (c) of the statute based on
what it deemed Sumner counsel’s narrowing of the issue to subsection (c)(4) in the reply
brief. Sumner counsel disagreed with this, saying that she had focused on one prong,
(c)(4), in her reply brief because of the State’s argument in its brief but had thoroughly
briefed the issue on subsection (c). She stated that she had no regrets about the way she
briefed the issue and that she had done so thoroughly but that the argument was hurt by
the appellate court’s limited analysis. As to this argument, and every other aspect of the
case, Sumner counsel told the petitioner that she could not guarantee the outcome at any
stage. Sumner counsel testified that the petitioner was upset after the appellate court
issued its opinion finding many of the questions were not dispositive and declining to rule
on the merits of those it deemed not dispositive. The petitioner was upset with Sumner
counsel for taking away his avenue of appeal.
On cross-examination, Sumner counsel reiterated that the petitioner was very
active in his case and asked a lot of questions. Based on the petitioner’s questions,
Sumner counsel felt he had a good understanding of the case and his right to a jury trial.
Sumner counsel believed that the petitioner understood he was giving up his right to a
jury trial by deciding to plead guilty with certified questions reserved. She testified that
-9-
he understood that if he proceeded to trial, his risk of conviction was great but that he
would retain his right to appeal every issue. Sumner counsel reiterated that she explained
to the petitioner the risk of dismissal on the “front end” of the certified questions because
of a mistake in the “paperwork” but told him that she was confident that would not
happen because she had successfully pursued certified questions recently and had done so
successfully on the “paperwork” side of it. She did discuss the “other hazards” of a
certified question, including the issue of “calling” something dispositive when it was not
and how the appellate court would decline to rule in that situation. She discussed with
the petitioner the risk of putting his case in the “Court of Criminal Appeals hands” versus
putting it in the hands of a jury and the difference between a ninety-plus-year sentence
with an automatic right to appeal versus a shorter sentence with some risks on appeal
because of the certified question. Sumner counsel gave the petitioner her best forecast as
to how each scenario might play out; however, she stated that she could not have
forecasted that the appellate court would conclude that she had narrowed the first issue in
her brief and then decline to rule on it; this issue, she felt, was the “heart” of the case.
The appellate briefs drafted by Sumner counsel were admitted into the record as exhibits.
The petitioner’s Davidson County attorney (hereinafter “Davidson counsel”)
testified that he represented the petitioner on the Davidson County charges. He filed a
motion to suppress the wiretap evidence by tailoring Sumner counsel’s motion to the
facts in Davidson County. He also observed the suppression hearing held in Sumner
County, argued by Sumner counsel, where he “learned a lot” about a case such as this one
involving large amounts of drugs over a long period of time. Davidson counsel testified
that he did not make any substantive changes to Sumner counsel’s motion; however, he
did litigate the motion himself. Davidson counsel recalled that he did not meet with the
petitioner independently from Sumner counsel and stated that they met jointly with the
petitioner three or four times. The petitioner “made it clear” to Davidson counsel that the
petitioner thought Sumner counsel was more knowledgeable and he was more interested
in her opinion on the law. Davidson counsel willingly assumed the role of “second
fiddle.”
As for the certified questions reserved in the petitioner’s Davidson County plea,
Davidson counsel testified that Sumner counsel offered to draft the certified questions,
and he accepted her offer. Davidson counsel recalled attending a meeting with the
petitioner and Sumner counsel about a possible plea deal, and the petitioner expressed
that he was not happy with the State’s offer. The petitioner and Sumner counsel
discussed “the pros and cons” of proceeding to trial, and Davidson counsel offered his
opinion that, based on his prior dealings in Davidson County Criminal Court, this amount
of drugs often resulted in the maximum sentence. Davidson counsel recalled that he
initiated discussions about a reduction of the plea offer sentence, but the State declined
and expressed its desire for the petitioner to turn down the State’s offer and proceed to
- 10 -
trial. Davidson counsel agreed that the plea deal encompassing all three counties was a
“package deal” from the outset and was never going to be anything other than a global
settlement. Davidson counsel agreed that he had nothing to do with the certified
questions or the appellate issues.
Davidson counsel agreed that the petitioner was motivated to enter a guilty plea
because of the certified questions and that Sumner counsel felt strongly that if the
appellate court addressed the certified questions, the petitioner would be granted relief.
The petitioner was otherwise “reluctant” to enter a guilty plea. Davidson counsel stated
that Sumner counsel was confident that the petitioner would win on appeal but agreed
that there were “prerequisites” to her confidence. He stated, “The qualifiers were there,”
pertaining to Sumner counsel’s predictions of success on appeal.
The petitioner testified that Sumner counsel’s testimony regarding their
relationship was accurate. The petitioner retained her on the recommendation of another
attorney that she was the premier wiretap lawyer in the State. The petitioner agreed that
Sumner counsel was very knowledgeable, although his reading of some of the wiretap
law differed from hers. The petitioner stated that he was amenable to Sumner counsel
being the lead counsel for all the suppression hearings, meaning her legal work was used
by his other attorneys in the other counties.
Regarding the certified questions, the petitioner agreed that he had no knowledge
of the law or procedure surrounding them and was reluctant to take the plea deal because
he was giving up his right to appeal many issues that were not included in the certified
questions. The petitioner acknowledged that he was exposed to lengthy sentences in the
three counties but that it was more important to him to have his issues heard on appeal.
Sumner counsel explained to him that certified questions of law are “particular” in the
way they are drafted and that it can be difficult to prevail in an appellate court or even
have them considered. The petitioner recalled that Sumner counsel had modeled the
certified questions for his case from certified questions she had successfully used in
another case. The petitioner understood that all of the certified questions would be heard
and that they were each deemed dispositive by agreement of the petitioner, the State, and
the trial court. Sumner counsel did not tell the petitioner that all of the questions were
dispositive, but the petitioner did not know at the time that the appellate court would be
making an independent conclusion about whether a question was dispositive before
review on the merits. The petitioner believed that the “barrier” was getting the State and
the trial court to agree, not the appellate court. He was not aware that the appellate court
could “divide” the questions and deem some dispositive and others not.
The petitioner testified that he became more knowledgeable on the wiretap law
and certified question procedure and that he did not agree with the way Sumner counsel
- 11 -
framed her argument about the wiretap statute in the appellate brief. The petitioner
testified that he did not feel that Davidson counsel was prepared for the suppression
hearing because he used Sumner counsel’s motion and did not do the research himself or
prepare independently. The petitioner acknowledged that Sumner counsel’s appellate
argument employed federal law and that this was a case of first impression at the state
level. Regarding the drafting of the certified questions, the petitioner testified that he was
present and had input but that the majority of them were drafted by Sumner counsel.
On cross-examination, the petitioner testified that he did not knowingly enter his
guilty plea because he would have chosen to go to trial if he had known that the
agreement of the parties was not sufficient to guarantee a finding that the questions were
dispositive and would be considered. He agreed that at the guilty plea submission
hearing, he was asked if he wished to waive his right to trial and that he affirmed that he
did.
The petitioner’s Rutherford County attorney (hereinafter “Rutherford counsel”)
testified that the petitioner’s charges in Rutherford county were not as serious as the other
counties. He stated that most of his contact with the other attorneys was with Sumner
counsel and that the petitioner wanted him to follow Sumner counsel’s lead with regard
to the wiretap issues. His understanding was that all the defenses in the various counties
were based on one theory that Sumner counsel had researched and prepared. Rutherford
counsel recalled that in Rutherford County the petitioner entered a plea to an A or B
felony with a forty-year sentence to be served at 30 percent. He stated that the petitioner
was not happy about the plea or the sentence, but he agreed to enter the plea in order to
have appellate review of his certified questions of law. Rutherford counsel agreed that
Sumner counsel prepared the certified questions of law and that he made no substantive
changes.
The post-conviction court found that Sumner counsel provided effective
representation at trial and on appeal and that the petitioner’s plea had been knowingly and
voluntarily entered. Accordingly, the post-conviction court denied the petition for post-
conviction relief. It is from this judgment that the petitioner now appeals.
II. Analysis
The petitioner raises identical issues to those in his appeal of the Davidson and
Rutherford Counties post-conviction courts’ order, contending that the Sumner County
post-conviction court erred when it denied his petition because he received ineffective
assistance of counsel. It is because of the ineffective assistance of counsel that he claims
his plea was not knowingly and voluntarily entered. He further claims that the post-
conviction court should have found that Sumner counsel was ineffective in her advice
- 12 -
and preparation regarding the certified questions of law and that she was ineffective by
waiving the petitioner’s argument on direct appeal with regards to Tennessee Code
Annotated section 40-6-304(c)(2). The State responds that the petitioner knowingly and
voluntarily entered his plea and that Sumner counsel prepared proper certified questions
of law with dispositive issues to reserve on appeal and properly advised the petitioner as
to the nature of certified questions of law. The State further responds that Sumner
counsel did not waive the petitioner’s argument regarding Tennessee Code Annotated
section 40-6-304(c)(2) on appeal.
In order to obtain post-conviction relief, a petitioner must show that his or her
conviction or sentence is void or voidable because of the abridgment of a constitutional
right. T.C.A. § 40-30-103 (2014). The petitioner bears the burden of proving factual
allegations in the petition for post-conviction relief by clear and convincing evidence.
T.C.A. § 40-30-110(f) (2014). The post-conviction court’s findings of fact are conclusive
on appeal unless the evidence preponderates against it. Fields v. State, 40 S.W.3d 450,
456-57 (Tenn. 2001). Upon review, this Court will not re-weigh or re-evaluate the
evidence below; all questions concerning the credibility of witnesses, the weight and
value to be given their testimony, and the factual issues raised by the evidence are to be
resolved by the trial judge, not the appellate courts. Momon v. State, 18 S.W.3d 152, 156
(Tenn. 1999); Henley v. State, 960 S.W.2d 572, 578-79 (Tenn. 1997). A post-conviction
court’s conclusions of law, however, are subject to a purely de novo review by this Court,
with no presumption of correctness. Id. at 457.
The right of a criminally accused to representation is guaranteed by both the Sixth
Amendment to the United States Constitution and article I, section 9, of the Tennessee
Constitution. State v. White, 114 S.W.3d 469, 475 (Tenn. 2003); State v. Burns, 6
S.W.3d 453, 461 (Tenn. 1999); Baxter v. Rose, 523 S.W.2d 930, 936 (Tenn. 1975). The
following two-prong test directs a court’s evaluation of a claim for ineffectiveness:
First, the [petitioner] must show that counsel’s performance was deficient.
This requires showing that counsel made errors so serious that counsel was
not functioning as the “counsel” guaranteed the [petitioner] by the Sixth
Amendment. Second, the [petitioner] must show that the deficient
performance prejudiced the defense. This requires showing that counsel’s
errors were so serious as to deprive the [petitioner] of a fair trial, a trial
whose result is reliable. Unless a [petitioner] makes both showings, it
cannot be said that the conviction or death sentence resulted from a
breakdown in the adversary process that renders the result unreliable.
Strickland v. Washington, 466 U.S. 668, 687 (1984); see also State v. Melson, 772
S.W.2d 417, 419 (Tenn. 1989).
- 13 -
In reviewing a claim of ineffective assistance of counsel, this Court must
determine whether the advice given or services rendered by the attorney are within the
range of competence demanded of attorneys in criminal cases. Baxter, 523 S.W.2d at
936. To prevail on a claim of ineffective assistance of counsel, “a petitioner must show
that counsel’s representation fell below an objective standard of reasonableness.” House
v. State, 44 S.W.3d 508, 515 (Tenn. 2001) (citing Goad v. State, 938 S.W.2d 363, 369
(Tenn. 1996)). When evaluating an ineffective assistance of counsel claim, the reviewing
court should judge the attorney’s performance within the context of the case as a whole,
taking into account all relevant circumstances. Strickland, 466 U.S. at 690; State v.
Mitchell, 753 S.W.2d 148, 149 (Tenn. Crim. App. 1988). The reviewing court should
avoid the “distorting effects of hindsight” and “judge the reasonableness of counsel’s
challenged conduct on the facts of the particular case, viewed as of the time of counsel’s
conduct.” Strickland, 466 U.S. at 689-90. In doing so, the reviewing court must be
highly deferential and “should indulge a strong presumption that counsel’s conduct falls
within the wide range of reasonable professional assistance.” Burns, 6 S.W.3d at 462.
Finally, we note that a defendant in a criminal case is not entitled to perfect
representation, only constitutionally adequate representation. Denton v. State, 945
S.W.2d 793, 796 (Tenn. Crim. App. 1996). In other words, “in considering claims of
ineffective assistance of counsel, ‘we address not what is prudent or appropriate, but only
what is constitutionally compelled.’” Burger v. Kemp, 483 U.S. 776, 794 (1987) (quoting
United States v. Cronic, 466 U.S. 648, 665 n.38 (1984)). Counsel should not be deemed
to have been ineffective merely because a different procedure or strategy might have
produced a different result. Williams v. State, 599 S.W.2d 276, 279-80 (Tenn. Crim.
App. 1980). “The fact that a particular strategy or tactic failed or hurt the defense, does
not, standing alone, establish unreasonable representation. However, deference to
matters of strategy and tactical choices applies only if the choices are informed ones
based upon adequate preparation.” House, 44 S.W.3d at 515 (quoting Goad, 938 S.W.2d
at 369).
If the petitioner shows that counsel’s representation fell below a reasonable
standard, then the petitioner must satisfy the prejudice prong of the Strickland test by
demonstrating there is a reasonable probability that, but for counsel’s unprofessional
errors, the result of the proceeding would have been different. Strickland, 466 U.S. at
694; Nichols v. State, 90 S.W.3d 576, 587 (Tenn. 2002). This reasonable probability
must be “sufficient to undermine confidence in the outcome.” Strickland, 466 U.S. at
694; Harris v. State, 875 S.W.2d 662, 665 (Tenn. 1994). The definition of “reasonable
probability is a probability sufficient to undermine confidence in the outcome.” Id.
When ineffective assistance of counsel is alleged in the context of a guilty plea, the
prejudice analysis
- 14 -
focuses on whether counsel’s constitutionally ineffective performance
affected the outcome of the plea process. In other words, in order to satisfy
the “prejudice” requirement, the defendant must show that there is a
reasonable probability that, but for counsel’s errors, he would not have
pleaded guilty and would have insisted on going to trial.
Hill v. Lockhart, 474 U.S. 52, 59 (1985); see also Grindstaff v. State, 297 S.W.3d 208,
216-17 (Tenn. 2009).
A. Knowing and Voluntary Plea
The petitioner claims that his plea was unknowingly and involuntarily entered
because he received the ineffective assistance of counsel. He stated that after the trial
court ruled on his motion to suppress, “instead of going to trial, [Sumner counsel]
negotiated a plea agreement, where the cases in all three counties would be resolved for a
sentence of 40 years.” He claims that because Sumner counsel was lead counsel in the
cases throughout the various counties, her actions and decisions should be attributed to
the attorneys in those other counties. The State responds that the evidence presented
shows that the petitioner’s plea was entered knowingly and voluntarily, and that without a
transcript of the petitioner’s guilty plea, which the States notes is not included in the
record, we are to presume the post-conviction’s court findings correct. We agree with the
State.
To be valid, a guilty plea must be entered knowingly, voluntarily, and
intelligently. See Boykin v. Alabama, 395 U.S. 238, 242-44 (1969); State v. Mackey, 553
S.W.2d 337, 340 (Tenn. 1977). A plea meets constitutional muster when the defendant
understands both what the plea connotes and its consequences, Blankenship v. State, 858
S.W.2d 897, 904 (Tenn. 1993) (citing Boykin, 395 U.S. at 244), and makes a voluntary
and intelligent choice from the alternative courses of action available to plead guilty.
Jaco v. State, 120 S.W.3d 828, 831 (Tenn. 2003) (citing North Carolina v. Alford, 400
U.S. 25 (1970)). A petitioner’s testimony at a guilty plea hearing “constitute[s] a
formidable barrier” in any subsequent collateral proceeding because “[s]olemn
declarations in open court carry a strong presumption of verity.” Blackledge v. Allison,
431 U.S. 63, 74 (1977).
When determining the knowing and voluntary nature of a guilty plea, the standard
is “whether the plea represents a voluntary and intelligent choice among the alternative
courses of action open to the defendant.” Alford, 400 U.S. at 31. A reviewing court can
look to a number of factors to find a “knowing and intelligent plea,” including “[t]he
relative intelligence of the petitioner, the degree of his familiarity with criminal
proceedings, the opportunity to confer with competent counsel and the trial court
- 15 -
regarding the charges faced, and the desire to avoid a greater punishment resulting from a
jury trial.” Blankenship, 858 S.W.2d at 904. The petitioner must have an understanding
of the charges against him and the consequences of pleading guilty, including “the
sentence that he will be forced to serve as the result of his guilty plea and conviction.”
Id. at 905. A plea is not “voluntary” if it results from ignorance, misunderstanding,
coercion, inducements, or threats. Id. at 904.
Initially the post-conviction court noted that it had reviewed the guilty plea
transcripts as well as the complete testimony of Sumner counsel and the petitioner from
the Davidson county post-conviction hearing. Based on its review of the record, the post-
conviction court found the plea allowed the petitioner to litigate the wiretap issues and
avoid three separate trials in three jurisdictions. Additionally, the plea agreement allowed
the petitioner “an opportunity to have a life, eventually, outside the penitentiary as
opposed to a life in the penitentiary . . . .” Finally, based on the its review of the entire
record, the post-conviction court concluded “that the guilty plea was entered knowingly,
voluntarily, and it was a guilty plea where the [p]etitioner was aware of all circumstances
and results.”
The evidence presented at the post-conviction hearing supports the decision of the
post-conviction court. While the petitioner was not “happy” about the plea, he chose to
enter the plea rather than risk a trial where he faced possible lengthy sentences.
Furthermore, the petitioner received a greatly reduced sentence while still retaining
review of his certified questions of law. Sumner counsel testified that the petitioner was
very engaged in the preparation of his case and in the decision whether to go to trial or
plead guilty. Rutherford and Davidson counsels affirmed that this was their impression
of the discussions they observed. Sumner counsel also stated that she did not like the
State’s offer and felt that the State was charging the petitioner excessively. She further
testified that she gave her clients the option to proceed to trial and did not shy away from
trying a case. In this case, however, where the petitioner faced a lengthy sentence
approaching 100 years, Sumner counsel encouraged him to enter a plea. Together,
Sumner counsel and the petitioner weighed the risk of taking his case to trial, where he
faced a lengthy sentence but retained all his rights of appeal, versus entering a guilty plea
for a sentence of less than half the potential prison time but reduced rights of appeal.
Finally, the petitioner affirmed that he was asked at the guilty plea hearing whether he
understood his right to trial and that he was giving up that right, which he stated he did.
Based on this evidence, we conclude that the petitioner’s plea was entered knowingly and
voluntarily and that counsel’s representation of the petitioner with regard to his decision
was effective. Thus, he is not entitled to relief.
- 16 -
B. Certified Questions of Law
The petitioner next claims that Sumner counsel was ineffective in her preparation
of the certified questions of law and in educating the petitioner on the applicable law.
The petitioner claims that Sumner counsel admitted that she knew that several of the
certified questions were not dispositive but that she also knew that the petitioner was only
accepting the plea offer because he wanted his issues heard on appeal. He contends that
Sumner counsel “crafted [] certified question[s] that she knew to be ineffective in
assisting [the petitioner] to allow that to happen.” The State responds that the evidence
does not preponderate against the post-conviction court’s findings that Sumner counsel
did not guarantee the petitioner success on appeal and informed the petitioner in advance
that his success on appeal depended on the appellate court’s interpretations of the law.
We agree with the State.
Despite the petitioner’s claim that Sumner counsel failed to fully and properly
advise him concerning the certified questions on appeal, the post-conviction court found
that Sumner counsel advised the petitioner “that even though the questions were going to
be called dispositive, there was always a chance that [this Court] would find them not to
be dispositive and would find a way not to rule on them.” Additionally, the post-
conviction court found the petitioner “was definitely informed that all issues not be
reviewed.” Finally, relying on his personal observations of watching Sumner counsel
represent the petitioner at trial, the post-conviction court found “[Sumner counsel] to be
very trustworthy and reliable” and “credit[ed] the testimony of [Sumner counsel], and
discredit[ed] the testimony of the [p]etitioner.”
Our review of the evidence shows that the evidence does not preponderate against
these findings. Sumner counsel advised the petitioner that there was the possibility that
his questions would not be deemed dispositive and that this meant there was a risk that
his issues would not be heard. Sumner counsel fully understood the importance of the
certified questions to the petitioner and spent multiple meetings discussing the option to
take his case to trial or accept a lesser sentence with the certified questions reserved.
Sumner counsel’s prior experience with certified questions on appeal allowed her to
advise the petitioner of the risks but also the possibility for success. Sumner counsel was
not ineffective in her representation of the petitioner in this regard.
The petitioner points us to several decisions promulgating the standards and
limitations for certified questions of law to which he claims Sumner counsel did not
adhere. State v. Preston stated that it was the appellate court’s determination, not that of
the trial court and the agreement of the parties, as to whether the certified question was
dispositive. 759 S.W.2d 647 (Tenn. 1988). The petitioner argues that Sumner counsel
was aware of this law; however, she failed to caution the petitioner that the certified
- 17 -
questions might not be heard. We disagree. The evidence shows that Sumner counsel
advised the petitioner that, although not all questions would be deemed dispositive, she
chose to include them anyway because it was her experience in the past that the appellate
court would sometimes overlook whether a question was dispositive and choose to
review it. This, however, was not “guaranteed” by Sumner counsel, and the petitioner
testified that he was informed of that. The petitioner is not entitled to relief on this issue.
C. Appellate Argument
The petitioner lastly contends that Sumner counsel provided ineffective assistance
of counsel on appeal when she “waived [the petitioner’s] primary argument on his direct
appeal,” that being his argument related to the probable cause requirement found at
Tennessee Code Annotated section 40-6-304(c)(2). He contends that Sumner counsel
improperly narrowed his appellate argument to one prong of the statute, (c)(4), in her
reply brief, causing the appellate court to waive consideration of what he contends was
his strongest argument. The State responds that Sumner counsel’s decisions to “use her
reply brief to hone in on the specific issue the State focused on in its response brief was a
reasonable strategic decision.” We agree with the State.
Sumner counsel provided her original appellate brief and reply brief as exhibits at
the hearing and testified that she argued all prongs of the statute in her first brief and
then, after the State responded, she addressed their particular argument in her reply brief.
She stated that nothing that she did limited or waived her argument as to certain aspects
of the statute and that she felt the appellate court had incorrectly determined that she had
done so. We have reviewed the briefs from the direct appeal and have determined that
the evidence does not preponderate against the post-conviction court’s finding that
Sumner counsel fully briefed the petitioner’s argument related to the probable cause
requirement found at Tennessee Code Annotated section 40-6-304(c). Sumner counsel
addressed the subsections of the statute in her brief that she felt most strongly aided her
argument that the wiretaps were unlawful. While this Court’s decision did limit the
petitioner’s argument, we conclude that the petitioner has not shown that Sumner counsel
was ineffective in this regard; she made a strategic decision to focus her argument in the
reply brief that we will not second guess. The petitioner is not entitled to relief.
III. Conclusion
In accordance with the aforementioned reasoning and authorities, we affirm the
judgment of post-conviction court.
- 18 -
____________________________________
J. ROSS DYER, JUDGE
- 19 -
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674 So.2d 628 (1996)
Charles Frederick BARR, Petitioner,
v.
STATE of Florida, Respondent.
No. 85864.
Supreme Court of Florida.
May 16, 1996.
Nancy A. Daniels, Public Defender and Kathleen Stover, Assistant Public Defender, Tallahassee, for Petitioner.
Robert A. Butterworth, Attorney General; James W. Rogers, Bureau ChiefCriminal Appeals, and Sonya Roebuck Horbelt, Assistant Attorney General, Tallahassee, for Respondent.
HARDING, Justice.
We have for review Barr v. State, 655 So.2d 1175 (Fla. 1st DCA 1995), which expressly and directly conflicts with the opinions in State v. Varner, 616 So.2d 988 (Fla. 1993), State v. Tyner, 506 So.2d 405 (Fla. 1987), Williams v. State, 500 So.2d 501 (Fla. 1986), and Bass v. State, 496 So.2d 880 (Fla. 2d DCA 1986). We have jurisdiction pursuant to article V, section 3(b)(3) of the Florida Constitution.
Charles Frederick Barr stole a car at gunpoint. Thereafter, when a police officer spotted the stolen car and attempted to pull the car over, Barr fled. A high speed chase followed in heavy traffic, nearly causing several accidents. Barr was charged with *629 armed robbery and possession of a firearm by a convicted felon.
A jury convicted Barr of armed robbery. He was sentenced to twenty-five years in prison, which was an upward departure from Barr's recommended guideline sentence of seven to nine years, with a permitted range of five and one-half to twelve years. The trial court entered a written departure order, reasoning that Barr displayed a flagrant disregard for the safety of others by recklessly driving during the chase with the police and endangering the lives of numerous innocent citizens.
On appeal, the First District Court of Appeal affirmed the lower court's departure sentence based on Garcia v. State, 454 So.2d 714 (Fla. 1st DCA 1984), which held that a defendant who leads police on a high-speed chase, shoots at the police, and is involved in a wreck during the chase may receive a departure sentence based on this conduct. See Barr v. State, 655 So.2d at 1175.
Judge Ervin dissented from the majority's conclusion that departure was appropriate. Id. at 1177 (Ervin, J., dissenting). Relying upon this Court's decisions in Tyner and Williams, Judge Ervin found that Florida Rule of Criminal Procedure 3.701(d)(11) prohibits departure sentences based on reasons relating to the instant offense for which convictions have not been obtained. Id. at 1178 (Ervin, J., dissenting). Judge Ervin noted that the only reason given for Barr's upward departure sentence was his flagrant disregard for the safety of others. Because Barr could have been charged with reckless driving, Judge Ervin concluded that departure was invalid on that basis. Id. at 1177 (Ervin, J., dissenting).
Barr argues that rule 3.701(d)(11), as interpreted by such cases as Varner, Tyner, Williams, and Bass, prohibits upward departure sentences when the conduct can be separately charged as another crime. Barr further argues that a contrary holding would eliminate a defendant's constitutional right to a trial as it would permit sentencing for a crime for which the defendant has not been convicted. Thus, he contends, a defendant must be charged and convicted for each instance of criminal conduct.
The State argues, however, that section 921.0016, Florida Statutes (1993),[1] which includes endangering the lives of many persons as a valid reason for upward departure sentences, controls the instant case instead of rule 3.701(d)(11). Furthermore, the State argues that Garcia, which held that a trial court may consider the circumstances surrounding a defendant's apprehension as a basis for departure, was properly applied to Barr. The State maintains that Garcia is distinguishable from Varner, Tyner, and Williams and that none of these cases hold that a departure sentence cannot be based on the circumstances surrounding the defendant's apprehension for the offense of which he is convicted when those circumstances endanger the lives of innocent people.
We find that section 921.0016 is not applicable to the instant case as it only applies to offenses committed on or after January 1, 1994. See ch. 93-406, § 13, at 2941, Laws of Fla. Barr was arrested and charged on November 24, 1993. Instead, we look to the language of rule 3.701(d)(11) to determine whether departure was proper in this case. Rule 3.701(d)(11) provides that "[r]easons for deviating from the guidelines shall not include factors relating to ... the instant offenses for which convictions have not been obtained." As this Court explained in Tyner, the language of rule 3.701(d)(11) is "plain" and specifically provides that "[j]udges may consider only that conduct of the defendant relating to an element of the offense for which he has been convicted." 506 So.2d at 406. Tyner involved a defendant originally charged with two counts of first-degree murder and one count of armed burglary. After the murder counts were dismissed, the defendant was convicted of armed burglary. The defendant's departure sentence was invalidated because it was based upon the murders for which Tyner had not yet been found *630 guilty. Id. We concluded that "[t]o hold otherwise would effectively circumvent the basic requirement of obtaining a conviction before meting out punishment." Id.
We adhered to this position in Varner and specifically held that "departure may not be based on conduct that could have, but has not yet, resulted in criminal conviction." 616 So.2d at 988-89. Varner was convicted of shooting into a building, shooting into a vehicle, and aggravated assault. Prior to his trial, Varner allegedly threatened a witness and the trial court entered a departure sentence based in part upon that threat. On appeal, the district court found this to be an invalid reason for departure. Id. at 988. In our review of the case, we approved the district court's decision and explained that "[i]f the State wishes to punish such collateral misconduct, the proper method is to separately charge and convict." Id. at 989.
Garcia, which the district court relied upon in the instant case, was decided several years before our decisions in Williams, Tyner, and Varner. Thus, the Garcia court did not have the benefit of our reasoning and conclusions in those cases. We agree with Judge Ervin's assessment that the "better course" for the district court in the instant case would have been to follow those cases "which clearly applied the precedent established" in this Court's previous decisions. Barr, 655 So.2d at 1178 (Ervin, J., dissenting).
Relying upon the reasoning in Williams, Tyner, and Varner, a departure sentence based on flagrant disregard for the safety of others is not valid where the conduct at issue could be separately charged and convicted. See, e.g., Felts v. State, 537 So.2d 995 (Fla. 1st DCA 1988) (finding that high speed chase and resulting fatal accident were not valid basis for departure because they involved circumstances surrounding the offense for which convictions were not obtained), approved, 549 So.2d 1373 (Fla.1989); Bass, 496 So.2d 880 (same). However, where the conduct evincing such disregard involves a situation where the conduct could not be separately charged as another crime it can be a valid reason for departure. See, e.g., Felts, 537 So.2d 995 (finding that gun battle with Georgia police officers which posed unnecessary risk of harm was valid basis for departure where the subsequent Georgia convictions for aggravated assault could not be factored into scoresheet); Burgess v. State, 524 So.2d 1132 (Fla. 1st DCA 1988) (upholding departure based on flagrant disregard for safety of others where defendant shot two victims who were standing in an alley while three bystanders stood nearby).
In the instant case, the auto chase that ensued after the officer attempted to stop Barr constituted criminal conduct. Barr could have been charged either with fleeing or attempting to elude a law enforcement officer pursuant to section 316.1935(1), Florida Statutes (1993), or with reckless driving pursuant to section 316.192(1), Florida Statutes (1993). Thus, this criminal conduct for which Barr was neither charged nor convicted cannot be a valid reason for a departure sentence. Varner, 616 So.2d at 988-89; Tyner, 506 So.2d at 406; Williams, 500 So.2d at 503. Moreover, while it is not determinative of our conclusion here, we note that Barr's departure sentence far exceeds any sentence that could have been imposed if he had been convicted of the uncharged offenses of eluding a police officer[2] or reckless driving.[3]
Accordingly, we quash the decision below and remand for imposition of an appropriate guideline sentence. We disapprove the opinion in Garcia to the extent that it is inconsistent with this opinion and our previous decisions in Varner, Tyner, and Williams. We also approve the opinion in Bass.
It is so ordered.
SHAW, KOGAN and ANSTEAD, JJ., concur.
*631 WELLS, J., dissents with an opinion, in which GRIMES, C.J., concurs.
OVERTON, J., dissents.
WELLS, Justice, dissenting.
I would approve the well-reasoned decision of the district court's majority. The cases relied upon in this Court's majority are factually distinguishable.
GRIMES, C.J., concurs.
NOTES
[1] Section 921.0016, Florida Statutes (1993), addresses recommended sentences and departure sentences. The statute lists a number of aggravating circumstances where departure from the sentencing guidelines is reasonably justified, including creating a "substantial risk of death or great bodily harm to many persons." Id. § 921.0016(3)(i).
[2] At the time of Barr's arrest, fleeing or attempting to elude an officer was punishable by imprisonment for a period not to exceed one year. § 316.1935(1), Fla.Stat. (1993).
[3] Reckless driving is punishable for up to ninety days imprisonment for a first offense and up to six months imprisonment for a second offense. § 316.192(2)(a), (b), Fla.Stat. (1993).
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48 So.2d 768 (1950)
Sam FIORELLA
v.
CITY OF BIRMINGHAM.
6 Div. 95.
Supreme Court of Alabama.
November 2, 1950.
Rehearing Denied November 30, 1950.
Gibson & Hewitt, of Birmingham, for petitioner.
Chas. H. Brown, Asst. City Atty., of Birmingham, opposed.
STAKELY, Justice.
Petition of Sam Fiorella for certiorari to the Court of Appeals to review and revise the judgment and decision of that Court in the case of Fiorella v. City of Birmingham, Ala.App., 48 So.2d 761.
Writ denied.
FOSTER, LAWSON and SIMPSON, JJ., concur.
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[Cite as State v. Henry, 2012-Ohio-4748.]
IN THE COURT OF APPEALS OF OHIO
SECOND APPELLATE DISTRICT
MONTGOMERY COUNTY
STATE OF OHIO
Plaintiff-Appellee
v.
CHRISTOPHER D. HENRY
Defendant-Appellant
Appellate Case No. 25007
Trial Court Case No. 11-CR-829
(Criminal Appeal from
(Common Pleas Court)
...........
OPINION
Rendered on the 12th day of October , 2012.
...........
MATHIAS H. HECK, JR., by ANDREW T. FRENCH, Atty. Reg. #0069384, Montgomery County
Prosecutor’s Office, Appellate Division, Montgomery County Courts Building, P.O. Box 972, 301 West
Third Street, Dayton, Ohio 45422
Attorney for Plaintiff-Appellee
JESSICA R. MOSS, Atty. Reg. #0085437, 2233 Miamisburg-Centerville Road, Dayton, Ohio 45459
Attorney for Defendant-Appellant
.............
FAIN, J.
{¶ 1} Defendant-appellant Christopher D. Henry appeals from his conviction and sentence,
2
following a no-contest plea, for Receiving Stolen Property, in violation of R.C. 2913.51(A), a felony of the
fourth degree, and for Possession of Criminal Tools, in violation of R.C. 2923.24(A), a felony of the fifth
degree. Henry contends that the trial court erred in overruling his motion to suppress evidence obtained
by means of the placing of a GPS tracking device on the underneath of a car he was driving, without a
warrant. Henry relies upon United States v. Jones, 565 U.S. ____, 132 S.Ct. 945, 181 L.Ed.2d 911
(2012).
{¶ 2} The State does not concede that under Jones the police were required to obtain a warrant
in order to place the GPS tracking device. But the State does not argue this point; the State argues that the
good-faith exception to the exclusionary rule applies because the police officer placing the device did so in
objectively reasonable reliance upon non-binding judicial authorities in other jurisdictions. The State did
not argue good faith at the suppression hearing, and no evidence was presented at the hearing that the
officer who placed the GPS device did so in reliance upon judicial authorities. Moreover, when Henry
attempted to question the police officer concerning whether the police officer believed that he had the
authority to place the GPS device without a warrant, an objection to the question was sustained upon the
ground that it was not relevant.
{¶ 3} The State relies upon Davis v. United States, ____ U.S. ____, 131 S.Ct. 2419, 180
L.Ed.2d 285 (2011), which holds that a police officer’s reliance upon binding judicial authority is
objectively reasonable, even when that authority is subsequently reversed or overruled. The State argues
that the result should be the same even if there is non-binding, persuasive judicial authority to support the
police officer’s actions. But the opinion in Davis expressly distinguishes its holding from situations where
the question of the lawfulness of the police officer’s action remains open in the governing jurisdiction.
131 S.Ct. 2433.
{¶ 4} We agree with Henry that a warrant was required for the placing of the GPS tracking
device upon the car he was driving, and that the evidence obtained as a result of the placing of that device
should have been suppressed. Accordingly, the judgment of the trial court is Reversed, and this cause is
3
Remanded for further proceedings.
I. The Placing of the GPS Tracking Device
{¶ 5} Centerville Police Officer Daniel Osterfeld was aware that a number of thefts had been
occurring at car dealerships on Loop Road, in Centerville. Osterfeld knew that Henry had been involved
previously in thefts from car dealerships. Osterfeld knew that Henry had been released from prison in
May 2010.
{¶ 6} When Osterfeld learned that Henry had been arrested on an outstanding traffic warrant
and that the car he was driving, which he had previously been observed driving, had been towed, Osterfeld
decided to place a GPS tracking device on the car. Henry did not own the car.
{¶ 7} Osterfeld went to the lot where the car had been towed, and identified himself as a police
officer. He asked to see the car. Osterfeld placed a GPS tracking device, and a supplemental battery
pack, on the underneath of the car. Both the tracking device and the battery pack were attached to the car
magnetically; they were not otherwise attached to the car. The tracking device provided the location and
speed of the car, but not any other information concerning the car.
{¶ 8} For several weeks while Osterfeld and other officers periodically checked the information
from the tracking device, nothing of note occurred. Then, on the night of December 28-29, 2010, the car
traveled to Columbus, Ohio, and back. Osterfeld was aware that car dealerships in Columbus and its
suburbs had been experiencing thefts. Osterfeld decided to go to the location of the car.
{¶ 9} Osterfeld caught up with the car in front of a convenience store on North Main Street, in
Dayton. Henry and another man walked out of the front door of the store and spoke for a couple minutes.
Then Henry opened up the back of the car and removed three large chrome truck tires, which were wheeled
in to the store.
{¶ 10} Henry left and came back with five more wheels. At that point, he was arrested.
4
II. The Course of Proceedings
{¶ 11} Henry was charged by indictment with Receiving Stolen Property and Possession of
Criminal Tools. He moved to suppress the evidence obtained when he was arrested, contending that it
was obtained as the result of an unlawful search and seizure. Specifically, he contended that the
placement and monitoring of the GPS tracking device constituted a search, that the search was unlawful
because it was performed without a warrant, and that the evidence was obtained as a result of that unlawful
search, and should therefore be excluded.
{¶ 12} After a hearing, the trial court overruled Henry’s motion to suppress. Thereafter, he pled
no contest to both charges, was convicted, and was sentenced accordingly. From his conviction and
sentence, Henry appeals.
III. The Placing and Monitoring of the GPS Tracking Device Was a Search,
and Because it Was Without a Warrant, it Was Unlawful, and the
Evidence Obtained as a Result Should Have Been Suppressed
{¶ 13} Henry’s sole assignment of error is as follows:
THE TRIAL COURT ERRED IN DENYING THE MOTION TO SUPPRESS
WHEN IT RULED THAT THE WARRANTLESS PLACEMENT OF THE GPS
DEVICE ON THE UNDERCARRIAGE OF THE VEHICLE FREQUENTLY DRIVEN
BY APPELLANT DID NOT CONSTITUTE A SEARCH UNDER THE FOURTH
AMENDMENT TO THE UNITED STATED [sic] CONSTITUTION OR UNDER
SECTION 14, ARTICLE I OF THE OHIO CONSTITUTION.
{¶ 14} Henry relies upon United States v. Jones, supra. The State acknowledges that Jones
holds that the placement of a GPS tracking device requires a warrant, but contends that the good-faith
exception to the exclusionary rule applies. The State relies upon Davis v. United States, supra.
5
{¶ 15} We note preliminarily that the State never raised the good-faith-exception issue in the
trial court, before, during, or after the suppression hearing. In fact, when Henry attempted to elicit
testimony from Osterfeld germane to that subject, the State objected, and its objection was sustained on the
ground of relevance:
Q. Do these GPS devices, do you believe that law enforcement should have the
authority to install these without –
MS. DENSLOW [representing the State]: Objection.
BY MR. COMBS [representing Henry]: – a warrant?
THE COURT: Sustained.
MR. COMBS: Your Honor, he – he – he says he uses them. I’m just asking his opinion about
using them.
THE COURT: His opinion is meaningless. It’s my decision.
{¶ 16} More importantly, we conclude that the State’s reliance upon Davis is misplaced. The State recognizes
that the holding in that case was that when a police officer relies upon binding judicial authority upholding the lawfulness
of the search he undertakes, his reliance is objectively reasonable, and therefore in good faith, despite the fact that the
judicial authority upon which he relies is subsequently reversed or overruled. The State argues that the holding in Davis
ought to extend to a police officer’s reliance upon persuasive, non-binding judicial authority. The State then points to a
number of judicial decisions, none of which were binding in this jurisdiction, that upheld warrantless use of GPS tracking
devices.
{¶ 17} The opinion in Davis, itself, belies the State’s position. Justice Alito wrote the opinion of the Court, in
which five other justices concurred. The defendant in that case, Davis, argued that “applying the good-faith exception to
searches conducted in reliance on binding precedent will stunt the development of Fourth Amendment law. With no
possibility of suppression, criminal defendants will have no incentive * * * to request that courts overrule precedent.” 131
S.Ct. 2432. In response to this argument, Justice Alito wrote:
And in any event, applying the good-faith exception in this context will not prevent judicial
6
reconsideration of prior Fourth Amendment precedents. In most instances, as in this case, the precedent
sought to be challenged will be a decision of a Federal Court of Appeals or State Supreme Court. But a
good-faith exception for objectively reasonable reliance on binding precedent will not prevent review and
correction of such decisions. This Court reviews criminal convictions from 12 Federal Courts of Appeals,
50 state courts of last resort, and the District of Columbia Court of Appeals. If one or even many of these
courts uphold a particular type of search or seizure, defendants in jurisdictions in which the question
remains open will still have an undiminished incentive to litigate the issue. This Court can then grant
certiorari, and the development of Fourth Amendment law will in no way be stunted. Id., at 2433.
(Footnote omitted, emphasis added.)
{¶ 18} From the italicized portion of Justice Alito’s opinion for the United States Supreme Court in Davis, it is
clear that the holding in that case, upon which the State relies in this case, has no application in a situation, like the one
before us, where the jurisdiction in which the search was conducted has no binding judicial authority upholding the search.
{¶ 19} In a footnote in its brief, the State notes that it is not conceding that the Fourth Amendment was violated
in this case because United States v. Jones, supra, leaves open the question whether a warrantless use of a GPS tracking
device is lawful if the police have probable cause to support the search. Significantly, the reason the United States
Supreme Court did not address that issue in Jones is because it was not raised in the trial court, and was therefore forfeited.
132 S.Ct. 954.
{¶ 20} Here, also, the State’s argument that the placement of the GPS tracking device, if it constituted a search,
was reasonable despite the lack of a warrant, was not made in the trial court. Henry filed a Supplemental Memorandum in
Support of [his] Motion to Suppress, in which he identified the issues as follows:
I. Whether law enforcement officers are required to obtain a warrant prior to placing a Global
Positioning System (GPS) tracking device on a vehicle located on private property; and
II. Whether law enforcement officers are required to obtain a warrant prior to monitoring and
collecting data from that GPS after placing it on that vehicle.
{¶ 21} Neither at the suppression hearing, nor in its memorandum in opposition to the motion to suppress, did the
7
State argue that even if the placement and monitoring of the GPS tracking device constituted a search for Fourth
Amendment purposes, it was based upon probable cause, and therefore lawful. The State’s memorandum argued solely
that the placement of the GPS tracking device did not constitute a search.
{¶ 22} The trial court wrote a well-reasoned decision overruling the motion to suppress. (It did not, of course,
have the benefit of the decision of the United States Supreme Court in United States v. Jones.) Unsurprisingly, in view of
the State’s failure to argue the point, the trial court did not consider, in the alternative, whether the placement of the GPS
tracking device, if it constituted a search, was nevertheless supported by probable cause, and therefore lawful.
{¶ 23} We conclude, therefore, just as the United States Supreme Court similarly concluded in Jones, that the
State has forfeited an argument that the placement of the GPS tracking device was a lawful search, even though it was
warrantless. The suppression hearing was not made up on that issue.
{¶ 24} Henry’s sole assignment of error is sustained.
IV. Conclusion
{¶ 25} Henry’s sole assignment of error having been sustained, the judgment of the trial court is
Reversed, and this cause is Remanded for further proceedings consistent with this opinion.
.............
GRADY, P.J., and DONOVAN, J., concur.
Copies mailed to:
Mathias H. Heck
Andrew T. French
Jessica R. Moss
Hon. Michael Tucker
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U.S. Bank N.A. v Ahmed (2019 NY Slip Op 05577)
U.S. Bank N.A. v Ahmed
2019 NY Slip Op 05577
Decided on July 10, 2019
Appellate Division, Second Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and subject to revision before publication in the Official Reports.
Decided on July 10, 2019
SUPREME COURT OF THE STATE OF NEW YORK
Appellate Division, Second Judicial Department
MARK C. DILLON, J.P.
RUTH C. BALKIN
LEONARD B. AUSTIN
BETSY BARROS, JJ.
2016-07498
2017-03669
(Index No. 703445/14)
[*1]U.S. Bank National Association, etc., appellant,
vMohammed Ahmed, etc., respondent, et al., defendants.
Fein, Such & Crane, LLP (D.J. & J.A. Cirando, Syracuse, NY [John A. Cirando, Bradley E. Keem, and Elizabeth deV. Moeller], of counsel), for appellant.
Petroff Amshen LLP, Brooklyn, NY (Serge F. Petroff, James Tierney, and Christopher Villanti of counsel), for respondent.
DECISION & ORDER
In an action to foreclose a mortgage, the plaintiff appeals from (1) an order of the Supreme Court, Queens County (Leslie J. Purificacion, J.), entered May 4, 2016, and (2) an order of the same court entered March 16, 2017. The order entered May 4, 2016, insofar as appealed from, denied those branches of the plaintiff's motion which were for summary judgment on the complaint insofar as asserted against the defendant Mohammed Ahmed, in effect, for summary judgment dismissing the affirmative defenses, and for an order of reference. The order entered March 16, 2017, insofar as appealed from, denied that branch of the plaintiff's motion which was for leave to renew the same branches of its prior motion.
ORDERED that the order entered May 4, 2016, is modified, on the law, by deleting the provision thereof denying those branches of the plaintiff's motion which were, in effect, for summary judgment dismissing the first, second, third, sixth, seventh, eighth, ninth, tenth, and eleventh affirmative defenses, and substituting therefor a provision granting those branches of the motion; as so modified, the order is affirmed insofar as appealed from, and so much of the order entered March 16, 2017, as denied that branch of the plaintiff's motion which was for leave to renew those branches of its prior motion which were, in effect, for summary judgment dismissing the first, second, third, sixth, seventh, eighth, ninth, tenth, and eleventh affirmative defenses is vacated; and it is further,
ORDERED that the order entered March 16, 2017, is affirmed insofar as reviewed; and it is further,
ORDERED that one bill of costs is awarded to the defendant Mohammed Ahmed.
In May 2014, the plaintiff commenced this action against the defendant Mohammed Ahmed (hereinafter the defendant) and others, to foreclose a consolidated mortgage in the amount of $595,000. The defendant asserted as affirmative defenses in his answer, inter alia, that the plaintiff failed to comply with the notice of default provisions of the mortgage and with the statutory [*2]requirements to commence a foreclosure action. The plaintiff moved, inter alia, for summary judgment on the complaint insofar as asserted against the defendant, in effect, for summary judgment dismissing the defendant's affirmative defenses, and for an order of reference. The Supreme Court, inter alia, denied those branches of the plaintiff's motion. Thereafter, the plaintiff moved, inter alia, for leave to renew its prior motion, and that branch of its motion was denied. The plaintiff appeals.
We agree with the Supreme Court's determination that the plaintiff failed to demonstrate, prima facie, that it strictly complied with RPAPL 1304. Proper service of the RPAPL 1304 notice containing the statutorily mandated content is a condition precedent to the commencement of a foreclosure action (see Aurora Loan Servs., LLC v Weisblum, 85 AD3d 95, 103). The statute requires that such notice must be sent by registered or certified mail, and also by first-class mail, to the last known address of the borrower (see RPAPL 1304[2]). "Proof of the requisite mailing is established with proof of the actual mailings, such as affidavits of mailing or domestic return receipts with attendant signatures, or proof of a standard office mailing procedure designed to ensure that items are properly addressed and mailed, sworn to by someone with personal knowledge of the procedure" (Wells Fargo Bank, NA v Mandrin, 160 AD3d 1014, 1016; see Citibank, N.A. v Conti-Scheurer, 172 AD3d 17).
Here, the plaintiff failed to submit an affidavit of mailing demonstrating that it properly mailed the RPAPL 1304 notice to the defendant pursuant to the terms of the statute (see U.S. Bank N.A. v Cope, 167 AD3d 965; Nationstar Mtge., LLC v LaPorte, 162 AD3d 784). Further, although the plaintiff submitted a certified mail receipt and tracking information from the United States Postal Service, under the circumstances, these documents did not prove that the RPAPL 1304 notice was actually mailed. In particular, the certified mail receipt did not contain a postmark indicating that it was sent. Further, there was no tracking number on the RPAPL notice or any other information on either the notice or the certified mail receipt to show that the receipt pertained to the mailing of the RPAPL notice, as opposed to some other document sent to the defendant. Similarly, the tracking information the plaintiff submitted did not contain any information linking the tracking information to the RPAPL notice and did not contain a delivery address. Thus, the documents submitted merely proved that a mailing was delivered on a particular date to an address in Astoria, Queens. Finally, the affidavit of the plaintiff's representative was insufficient to establish that the notice was sent to the defendant in the manner required by RPAPL 1304, "as the representative did not provide proof of a standard office mailing procedure" (U.S. Bank N.A. v Cope, 167 AD3d at 968; see Citibank, N.A. v Conti-Scheurer, 172 AD3d at 20; U.S. Bank N.A. v Henry, 157 AD3d 839, 842; Investors Sav. Bank v Salas, 152 AD3d 752, 753; Citibank, N.A. v Wood, 150 AD3d 813, 814; cf. Wells Fargo Bank, N.A. v Heiney, 168 AD3d 1126).
The plaintiff similarly failed to establish, prima facie, that it mailed a notice of default to the defendant by first-class mail on any particular date, or actually delivered such notice to the designated address if sent by other means, as required by the terms of the mortgage as a condition precedent to foreclosure (see Wells Fargo Bank, N.A. v Sakizada, 168 AD3d 789, 791; Emigrant Bank v Myers, 147 AD3d 1027, 1028).
Since the plaintiff failed to establish, prima facie, that it complied with the requirements of RPAPL 1304 and with a contractual condition precedent, we agree with the Supreme Court's determination denying those branches of its motion which were for summary judgment on the complaint insofar as asserted against the defendant, in effect, for summary judgment dismissing the fourth and fifth affirmative defenses, and for an order of reference, regardless of the sufficiency of the defendant's opposition papers (see Winegrad v New York Univ. Med. Ctr., 64 NY2d 851, 853).
The Supreme Court should have granted that branch of the plaintiff's motion which was, in effect, for summary judgment dismissing the sixth affirmative defense, alleging that the plaintiff failed to comply with RPAPL 1303. Proper service of the notice required by RPAPL 1303 notice is a condition precedent to the commencement of a foreclosure action, and it is the plaintiff's burden to show compliance with that statute (see Aurora Loan Servs., LLC v Weisblum, 85 AD3d at 102; First Natl. Bank of Chicago v Silver, 73 AD3d 162, 169). The statute requires that the mandated notice be "delivered with the summons and complaint" (RPAPL 1303[2]). Here, the [*3]plaintiff established, prima facie, through a process server's affidavit, that the requisite notice in the form prescribed by RPAPL 1303 was "delivered" with the summons and complaint (see US Bank N.A. v Nelson, 169 AD3d 110), and the defendant failed to raise a triable issue of fact in opposition.
The Supreme Court also should have granted that branch of the plaintiff's motion which was, in effect, for summary judgment dismissing the ninth affirmative defense, alleging that the plaintiff lacked standing because it was not the holder or assignee of the note at the time the action was commenced. The plaintiff established, prima facie, that it was the holder of the underlying note at the commencement of the action by attaching the consolidated note, endorsed in blank, to the summons and complaint when it commenced the action (see Wells Fargo Bank, N.A. v Zucker, 169 AD3d 856; U.S. Bank N.A. v Sabloff, 153 AD3d 879, 880; Deutsche Bank Natl. Trust Co. v Carlin, 152 AD3d 491, 492). The defendant failed to raise a triable issue of fact in opposition.
The Supreme Court further should have granted those branches of the plaintiff's motion which were, in effect, for summary judgment dismissing the first, second, third, seventh, and eleventh affirmative defenses. The plaintiff demonstrated, prima facie, that those affirmative defenses were without merit, and the defendant failed to raise a triable issue of fact in opposition (see Emigrant Bank v Myers, 147 AD3d 1027, 1028). The court should have granted those branches of the plaintiff's motion which were, in effect, for summary judgment dismissing the eighth and tenth affirmative defenses, since they were conclusory in nature and contained no factual allegations (see Bruno v Sant'Elia, 52 AD3d 556, 557; Cohen Fashion Opt., Inc. v V & M Opt., Inc., 51 AD3d 619).
The Supreme Court did not improvidently exercise its discretion in denying that branch of the plaintiff's motion which was for leave to renew, inter alia, those branches of its motion which were for summary judgment and for an order of reference. Leave to renew "shall be based upon new facts not offered on the prior motion that would change the prior determination" (CPLR 2221[e][2]) and "shall contain reasonable justification for the failure to present such facts on the prior motion" (CPLR 2221[e][3]). "[A] motion to renew is not a second chance freely given to parties who have not exercised due diligence in making their first factual presentation" (Jovanovic v Jovanovic, 96 AD3d 1019, 1020; see Cioffi v S.M. Foods, Inc., 129 AD3d 888, 891). Here, the plaintiff did not provide a reasonable justification for its failure to present the additional facts at the time its earlier motion was made (see Kio Seob Kim v Malwon, LLC, 155 AD3d 1017, 1018).
The plaintiff's remaining contentions are without merit.
DILLON, J.P., BALKIN, AUSTIN and BARROS, JJ., concur.
ENTER:
Aprilanne Agostino
Clerk of the Court
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4 Ill. App.2d 526 (1955)
124 N.E.2d 573
Eleanor P. Simpson, Appellant,
v.
Claude E. Simpson, Appellee.
Gen. No. 46,425.
Illinois Appellate Court First District, Second Division.
February 15, 1955.
Rehearing denied March 7, 1955.
Released for publication March 7, 1955.
*527 *528 G. Donald Whitehouse, of Chicago, for appellant.
Peden, Ryan & Andreas, of Chicago, for appellee; Sol R. Friedman, and I.S. Friedman, both of Chicago, of counsel.
MR. PRESIDING JUSTICE McCORMICK delivered the opinion of the court.
This is an appeal from an order denying the plaintiff's petition for an allowance on account of suit money and attorney's fees incurred in enforcing a decree for divorce originally obtained in Tennessee and in defending it against the defendant's attempts to modify it. In the notice of appeal the plaintiff also includes an appeal from that portion of an order entering judgment in favor of the plaintiff for delinquent installments for child support accrued over a period of 6 1/2 years which did not allow the plaintiff the right to recover statutory interest on the successively maturing installments from the dates on which they fell due. This order had been entered more than 90 days before the notice of appeal was filed.
*529 On July 31, 1946 the plaintiff obtained a divorce from the defendant in Hamilton county, Tennessee, on the ground of cruelty. By the terms of the decree she was awarded the custody of the minor son of the parties, and the defendant was directed to pay her the sum of $5 per week for the support and maintenance of the child. This order was subsequently increased to $20 per week. The defendant was in arrears for a period of 6 1/2 years. He had left the State of Tennessee, and had become a resident of the State of Illinois. On January 29, 1953 the plaintiff filed a supplemental complaint in the superior court of Cook county to establish and enforce the Tennessee decree, which was answered. The trial court on May 6, 1953, after a hearing, entered a decree establishing, confirming and adopting the decree of divorce previously entered in Tennessee, together with the order which increased the award for the support of the minor child, as the decree and order of the superior court of Cook county. This decree set forth verbatim the Tennessee decree and order, together with applicable portions of the Tennessee divorce and interest acts.
On May 29, 1953 the plaintiff filed a petition for judgment for support money arrearage. The defendant filed an answer and a hearing was had on June 22, 1953, when the trial court entered judgment in favor of the plaintiff for the full principal amount claimed, $1,688.57, but refused to allow the plaintiff statutory interest on the successively maturing installments of child support from the dates on which they fell due.
On August 17, 1953 the plaintiff filed a petition asking for an allowance of suit money and attorney's fees, liability for which it was alleged had been incurred in enforcing the decree and defending it against the defendant's attempts to modify it. In this petition the plaintiff set up that her attorney had devoted 200 hours to enforcing and defending the decree; that the fair, *530 average and reasonable value of such services was not less than $15 per hour for services rendered out of court and the sum of not less than $20 per hour in court, or a minimum of $3,000 without apportionment of the time spent in and out of court; that she had incurred expense of $40 for the employment of court reporters and additional expense in the amount of $140.08 in bringing two witnesses from Chattanooga to Chicago in connection with the hearing on the petition for judgment.
The defendant filed an answer in which he denied that the plaintiff was entitled to attorney's fees or suit money; and alleged that the matter had been previously adjudicated and that there was a final judgment therein; that the attorneys who filed the answer are not considered any longer of record in the matter, and prayed that the petition might be dismissed for want of equity.
On October 5, 1953 the plaintiff filed a notice properly served on the defendant on August 28, 1953 of the time and place of the hearing. On October 5, 1953 the court denied the petition of the plaintiff, and on December 31, 1953 notice of appeal was filed.
The plaintiff's theory of the case is that she was entitled to recover her expenses and attorney's fees and to recover interest on the delinquent installments of child support from the dates on which they fell due; and that section 74 (1) of the Civil Practice Act (Ill. Rev. Stats. 1953, ch. 110, par. 198 [Jones Ill. Stats. Ann. 104.074]) would permit this court to review the order entered by the trial court on June 22, 1953 in which the trial court fixed the amount of money due but refused to allow interest, as well as the order entered by the trial court on October 5, 1953 denying the plaintiff's application for suit money and solicitor's fees.
As to the judgment entered June 22, 1953 the plaintiff contends that the court erred in denying interest. *531 The defendant first argues that this court has no right to consider any error in such judgment or order because of the fact that no notice of appeal was filed within 90 days from the date of the entry of such order. The plaintiff's theory is that this court has such right under the provisions of section 74 (1) of the Practice Act (Ill. Rev. Stats. 1953, ch. 110, par. 198), which provides:
"(1) Every order ... judgment or decree, rendered in any civil proceeding, if reviewable by the Supreme or Appellate Court of this State by writ of error, appeal or otherwise, shall hereafter be subject to review by notice of appeal.... Such appeal shall be deemed to present to the court all issues which heretofore have been presented by appeal and writ of error."
[1-3] Prior to the enactment of the Practice Act a litigant could obtain a review of a judgment or decree either by appeal or writ of error or by both of these modes of appellate procedure. Bradford Supply Co. v. Waite, 392 Ill. 318. The right to a writ of error was extended to chancery cases. Anderson v. Steger, 173 Ill. 112; Leland v. Leland, 319 Ill. 426. A writ of error brought up the entire record. Drummer Creek Drain. Dist. v. Roth, 244 Ill. 68.
Since the passage of the Practice Act, two cases have been before our Supreme Court involving substantially the same factual situation. In Bride v. Stormer, 368 Ill. 524, which was a foreclosure suit, the appellants sought to obtain a deficiency decree against the receiver and Stormer, the maker of the notes and trust deed. The circuit court on November 19, 1936, in a foreclosure decree, dismissed the complaint for want of equity as to the receiver, and on December 29, 1936 entered a deficiency decree against Stormer. Notice of appeal was filed March 12, 1937. The notice of appeal included an appeal from the decree of November *532 19, 1936. The court reviewed both decrees. The court says, after quoting section 74 of the Practice Act:
"Under the earlier practice, a decree determining the rights of the parties was not subject to review in an appeal from a subsequent decree in the same suit, which did not involve those rights; but a writ of error, sued out after the later decree was rendered, could be made use of to review the entire record, including the earlier decree. (Drummer Creek Drainage District v. Roth, 244 Ill. 68, 72.) In that case we held: `While this court has held that in partition proceedings the decree which finally adjudicated the rights and interests of the parties could not be reviewed on appeal from a later decree in the same proceeding which did not affect such interests of the parties, (Crowe v. Kennedy, 224 Ill. 526; Piper v. Piper, 231 Ill. 75;) we have also permitted, in partition proceedings, the original decree fixing the rights of the parties and a later decree taxing costs against certain of the parties to be reviewed by one writ of error. Smith v. Roath, 238 Ill. 247.'
"Appellants could have reviewed both these decrees by a single writ of error before the adoption of the Civil Practice act, and now, in view of section 74 (1), supra, both decrees may be reviewed by one appeal. The contention that the notice of appeal filed March 12, 1937, could not include the decree of November 19, 1936, cannot be sustained."
Rabe v. Rabe, 386 Ill. 600, was a partition suit in which decrees of partition, sale and confirmation of the sale were entered by the court. After the sale an accounting was had before a master and a report of distribution prepared which was objected to by the defendant, which objections were overruled on March 30, 1943. The defendant then made a motion to vacate the previous orders and decrees and to dismiss the suit for partition. This was denied, and notice of appeal *533 was filed June 28, 1943. The notice of appeal also prayed that the correctness of the decree of the court confirming distribution, the decree of the court confirming the master's report of the sale, and the decree of the circuit court which approved and confirmed the master's report awarding partition be also considered and determined on the appeal. The court found that the decree of partition and the decree of the court confirming the master's report of sale were final orders and that the time in which to appeal from both such decrees had passed at the time the defendant gave his notice of appeal in the case, and says:
"Where a decree of partition definitely settles the interests of the parties and appoints commissioners to make partition it is a final decree, and if any of the parties are dissatisfied with it an appeal should be taken in accordance with the statute, as such decree cannot be questioned upon an appeal from a subsequent decree ordering a sale of the premises. (White v. Van Patten, 280 Ill. 215, Lantz v. Lantz, 261 Ill. 194; Bergman v. Rhodes, 334 Ill. 137.)... The same rule is applicable to a decree ordering the sale of the premises, and to the decree of the court confirming the master's sale of the premises."
In Rabe v. Rabe, supra, the construction of section 74 of the Practice Act was not raised or argued. Neither this section nor the case of Bride v. Stormer, supra, was referred to in the opinion. In Feldman v. Illinois State Pawners Ass'n, 279 Ill. App. 476, the court stated, and in Borin v. Borin, 343 Ill. App. 649, the court followed, the rule laid down in Bride v. Stormer, supra.
The defendant cites Northern Trust Co. v. Stewart, 289 Ill. App. 286, which was an appeal from an order of the superior court of Cook county dismissing a petition filed by the defendants which asked the court to review that order and also a former decree entered by the court. A bill in equity had been filed by testamentary *534 trustees asking the court to construe a will and partnership agreement and for instructions as to the distribution of certain sums of money received by them in payment for the testator's interest in a partnership. The court entered a decree on November 12, 1935. On November 30, 1935 parties to the original suit filed a petition raising the same questions, which petition on January 21, 1936 the court denied, reciting in the order, as its ruling, its previous final decree. The court says:
"If the petition were permitted to stand, it would result in an attempt on their part to have the final decree which was entered on November 12, 1935, reviewed by the trial court after the time for appeal had expired....
"It is quite evident that the final decree of November 12, 1935, disposed of all the substantial final matters prayed for in the bill as well as the matters contained in the subsequent petition. In our opinion the petition was merely again raising the same questions which had already been decided and disposed of by such decree."
The court in that case did not consider section 74 of the Practice Act. In Classen v. Ripley, 407 Ill. 350, also cited by the defendant, an order was entered on July 18, 1949 dismissing the complaint for want of equity. On February 3, 1950 the court denied plaintiff's motion to vacate the order of July 18, 1949 and to permit plaintiff to file an amended complaint, from which order an appeal was taken to the Supreme Court. The Supreme Court held that the matter was not properly before the Supreme Court, and transferred the case to the Appellate Court. In Classen v. Ripley, 343 Ill. App. 298, the Appellate Court reversed the order of the circuit court, and ordered that the plaintiff be permitted to file her amended complaint and that the case be allowed to proceed. In neither of these cases *535 was there any consideration of the question now before this court. These cases are not applicable.
[4] We believe that in the case now before us we have the right to follow the rule in Bride v. Stormer, supra, and review the alleged errors in both orders. 21 C.J.S., Courts § 186; United States v. Mitchell, 271 U.S. 9, 70 L.Ed. 799, 46 S.Ct. 418.
In the original decree entered by the trial court it is provided that the said decree shall be enforced herein by "fine and imprisonment as in cases of contempt and by any and all other remedies which are and shall be available to plaintiffs in like cases in the Superior Court of Cook County under and by virtue of the laws of the State of Illinois," and "that the Court shall retain jurisdiction of the parties hereto and of the subject matter hereof for the purpose of entering judgments herein from time to time for installments of child support already accrued, and hereafter to accrue, under and by virtue of the terms of said decree and order, as the plaintiff shall elect; for the purpose of taking an accounting or accountings from the defendant as to any and all sums of money presently due or hereafter to become due to the plaintiff from the defendant under and by virtue of said decree and order; and for the purpose of enforcing generally said decree and said order." The court entered judgment on June 22, 1953 on the petition of the plaintiff alleging that the defendant was in arrears $1,688.57 for support money for the minor child. The petitioner prayed judgment for that amount, together with interest at the rate of 6 per cent, which interest was to run from the time when such payments became due under the order. The plaintiff contends that the trial court, in entering judgment for the principal amount, erred in failing to include in its order interest prayed for. The defendant urges that the court's ruling was proper in that the allowance of interest was a matter within the discretion of the court.
*536 [5, 6] It has been held that interest may be recovered on each monthly payment from the time when it became due in a suit to enforce a decree of separate maintenance. Pope v. Pope, 2 Ill.2d 152. In acting on the petition of the plaintiff the court was acting under its specifically reserved right in the decree. The decree set forth the statute of the State of Tennessee relating to interest. The trial court was in error in not allowing interest as prayed for in the petition. To deny it was not within the discretion of the court.
[7] The order of October 5, 1953 denying the petition of plaintiff for allowance of suit money and attorney's fees was also erroneous. We have repeatedly held that where the defendant refuses to pay alimony or support money under an order of court and it is necessary in order to enforce such order for the plaintiff to petition the court to compel the payment of the money, attorney's fees and the necessary expenses are properly allowed. Shuff v. Fulte, 344 Ill. App. 157; Kohl v. Kohl, 330 Ill. App. 284; Slezak v. Slezak, 293 Ill. App. 489; Czarra v. Czarra, 128 Ill. App. 430.
The defendant argues that under the law of Tennessee the plaintiff would not be allowed expenses and attorney's fees in a proceeding to enforce a decree. While we do not believe that such contention is material, because this proceeding was to enforce an Illinois decree, the decree of the Tennessee court having been confirmed and adopted and made a decree of the superior court of Cook county, nevertheless the cases in Tennessee do not sustain the defendant's contention. Graham v. Graham, 140 Tenn. 328, 204 S.W. 987; Pendray v. Pendray, 35 Tenn. App. 284, 245 S.W.2d 204.
[8, 9] The defendant made a motion in this court to dismiss the appeal and filed suggestions and affidavit in support thereof, which motion was taken with the case. The only suggestion which we have not heretofore considered in this opinion is apparently based on a motion in the nature of a release of errors, since, *537 according to the submitted affidavit, the defendant had prior to the filing of the motion paid $500 which was accepted by the plaintiff. He does not state that the $500 was paid on account of the judgment. Taking all intendments against the defendant, he has not properly set out matter which would give rise to a motion in the nature of a plea of release of error. Ward v. Williams, 278 Ill. 227; Beardsley v. Smith, 139 Ill. 290. In any case, he could not invoke the doctrine of release of errors by acceptance of the benefits of the judgment appealed from to prejudice the rights of a minor. Here the judgment was for the support of a minor child. To all intents and purposes the plaintiff in this case occupies a position of next friend or guardian ad litem for the minor child. Under these circumstances she has no power to release errors in prejudice of the rights of the minor. Ward v. Williams, 278 Ill. 227; Jespersen v. Mech, 213 Ill. 488; Johnston v. Johnston, 138 Ill. 385. The motion is denied.
The judgment order entered by the trial court on June 22, 1953 which does not include an allowance for interest at the rate of 6 per cent per annum on each monthly payment on which the defendant was in arrears, the interest to run from the time when such payment became due, should be modified to include such interest. The order of the court entered on October 5, 1953 denying the petition of the plaintiff is reversed, and the trial court should determine what is properly due the plaintiff for expense money and attorney's fees and enter judgment therefor. The cause is remanded to the superior court of Cook county for such further proceedings as are not inconsistent with the views herein expressed.
Order reversed and cause remanded with directions.
ROBSON and SCHWARTZ, JJ., concur.
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389 Mass. 634 (1983)
451 N.E.2d 704
ALEXANDER C. HABEEB
vs.
RETIREMENT BOARD OF QUINCY.
Supreme Judicial Court of Massachusetts, Norfolk.
April 7, 1983.
July 8, 1983.
Present: HENNESSEY, C.J., WILKINS, ABRAMS, NOLAN, & O'CONNOR, JJ.
Robert J. Muldoon, Jr. (Joshua M. Alper with him) for the plaintiff.
Laurence W. Cowley, Assistant City Solicitor, for the defendant.
NOLAN, J.
The sole issue here is whether G.L.c. 32, § 60, bars the plaintiff, Alexander C. Habeeb, from receiving noncontributory veterans' retirement benefits. We hold that it does.
Habeeb is a veteran with more than thirty years of public employment in the Commonwealth. In 1981, Habeeb, then an active school teacher in the Quincy school system, sought a declaratory judgment that his service in the Massachusetts National Guard prior July 1, 1939, qualified as "employment" within the meaning of G.L.c. 32, § 60, the statute which bars veterans from receiving noncontributory retirement benefits if their public employment began after *635 June 30, 1939. A judge of the Superior Court held that Habeeb's national guard service did not qualify as "employment." The Appeals Court reversed the judgment, stating simply in relevant part that it "reject[ed] the defendant's contention that G.L.c. 33, § 94, which was inserted by St. 1954, c. 590, § 1,[1] has any application to G.L.c. 32, §§ 56-60." Habeeb v. Retirement Bd. of Quincy, 15 Mass. App. Ct. 902, 903 (1982). We allowed the application for further appellate review filed by the defendant, the retirement board of Quincy (board).[2]
The relevant portions of G.L.c. 33, § 94, and G.L.c. 33, § 88, referred to in § 94, are set forth in the margin.[3]*636 The board contends simply that the Commonwealth's militia is a statutorily unique organization and that the plain language of G.L.c. 33, §§ 88 & 94, expresses the Legislature's intent that persons performing services under § 88 are not to be considered State employees for purposes of retirement benefits. Habeeb, on the other hand, argues that § 94 "applies only to persons seeking disability compensation for service-related motor vehicle injuries" and that the legislative history of §§ 88 and 94 makes clear that the Legislature did not intend "to deprive otherwise eligible employees of non-disability related benefits in a portion of a statute which has dealt from its origin exclusively with the subject of disability claims derived from motor vehicle accidents." While we think that the language of §§ 88 and 94 is less than plain,[4] we conclude that the legislative history of *637 §§ 88 and 94 indicates that the Legislature did intend to include officers and enlisted persons of the Commonwealth's militia within the bar erected by § 94.
Mindful that it is our duty to "construe the statute to effectuate the objectives of its framers," James J. Welch & Co. v. Deputy Comm'r of Capital Planning & Operations, 387 Mass. 662, 666 (1982), we turn to the legislative history and context of §§ 88 and 94 for insight into those objectives. See Aldoupolis v. Commonwealth, 386 Mass. 260, 264, cert. denied, 459 U.S. 864 (1982).
In 1943, the Legislature enacted St. 1943, c. 409 (1943 Act), an emergency provision entitled "An Act to provide for the acquiring of motor vehicles or for obtaining the use thereof by the military division of the executive department and for the settlement of certain claims against the commonwealth arising out of the operation of motor vehicles."[5] Section 1 of this act amended G.L.c. 33 by inserting after § 55 new sections 55A through 55F. Until that time, G.L.c. 33, § 55, provided only for compensation benefits to members of the organized militia injured or disabled in the performance of their duty. The newly inserted § 55C was substantially the same as present G.L.c. 33, § 88.[6] Section 1 of the 1943 Act also inserted in G.L.c. 33 a new provision, § 55F, which was, in relevant part, essentially the same as the present G.L.c. 33, § 94.[7] Section 1 made no other reference to the employment status of members of the Commonwealth's militia.
Sections 3 and 4 of the 1943 Act, however, are particularly revealing as to the Legislature's intent. Section 3 amended *638 G.L.c. 12, § 3B, which defined the obligation of the Attorney General to defend State employees or officers, at their request, in actions arising out of their use of State-owned motor vehicles, by adding a new paragraph which provided in part that "[f]or the purposes only of this section, an officer, or soldier of the military forces of the commonwealth, ... shall while performing any lawfully ordered military duty be deemed to be an officer or employee of the commonwealth" (emphasis added).[8] Section 4 of the 1943 Act amended G.L.c. 260, § 4, the statute which established time limitations for the commencement of certain actions against, among others, State officers and employees, by adding a new sentence which provided that "[f]or the purposes only of this section, an officer or soldier of the military forces of the commonwealth, ... shall while performing any lawfully ordered military *639 duty be deemed to be an officer or employee of the commonwealth" (emphasis added).
A further indication as to the Legislature's intent is found in its enactment of St. 1963, c. 606 (1963 Act), which provides: "Notwithstanding the provisions of any general or special law to the contrary, any person who is now a member of the state retirement system and who was employed by the Massachusetts National Guard as a caretaker or air technician prior to July first, nineteen hundred and thirty-nine, shall be considered to have been employed by the commonwealth prior to said date, and shall be subject to the provisions of sections fifty-six to fifty-nine, inclusive, of chapter thirty-two of the General Laws, and may, if otherwise eligible, be retired under said sections." It is evident that, if caretakers and air technicians were already considered to be employees of the Commonwealth, this legislation would be superfluous. "An intention to enact a barren and ineffective provision is not lightly to be imputed to the Legislature." Insurance Rating Bd. v. Commissioner of Ins., 356 Mass. 184, 189 (1969). We think the more reasonable interpretation, especially in view of the disclaimer with which the 1963 Act begins, is that caretakers and air technicians were not considered to be employees of the Commonwealth prior to the 1963 Act.[9]
*640 "[I]ndividual statutory provisions related to the same general area must be read `as a whole ... to the end that, as far as possible, the [entire legislative program] will constitute a consistent and harmonious whole.'" Jones v. Wayland, 380 Mass. 110, 118 (1980), quoting Haines v. Town Manager of Mansfield, 320 Mass. 140, 142 (1946).[10] Guided by this principle, we are led by our reading of the 1943 Act and the 1963 Act to the conclusion that the Legislature intended that officers and enlisted persons in the Commonwealth's militia should be considered as State officers or employees only for the limited purposes expressed in specific legislative enactments such as §§ 3 and 4 of the 1943 Act. It follows that the Legislature intended to include the Commonwealth's military officers and enlisted persons within the bar erected by G.L.c. 33, § 55F, as presently codified at G.L.c. 33, § 94. While it may be argued that this interpretation conflicts with the title and emergency preamble of the 1943 Act, we think that the Legislature's simultaneous substantive amendments, and its later enactment of the same subject, are more authoritative indications of its intent than the title and prefatory language which the Legislature gave to its amendments.[11]
Judgment of the Superior Court affirmed.
NOTES
[1] Statute 1954, c. 590, § 1, represented a major recodification of G.L.c. 33, the chapter dealing with the militia. While it is technically correct that the relevant statute was first codified as § 94 in 1954, the statute, in substantially its present form, first appeared in St. 1943, c. 409, § 1, and was codified at that time as G.L.c. 33, § 55F.
[2] Although the board sought further review only as to the effect of G.L.c. 33, § 94, on Habeeb's claim, we granted its application without limitation as to the issues we would consider. See Ford v. Flaherty, 364 Mass. 382, 386-387 (1973) (ordinarily all issues before the Appeals Court are before the Supreme Judicial Court when leave to obtain further appellate review is granted). Because this issue is dispositive of Habeeb's claim, however, we do not reach other issues raised before the Appeals Court.
[3] General Laws c. 33, § 94, as appearing in St. 1954, c. 590, § 1, provides in pertinent part: "No person performing any services under section eighty-eight shall, by reason of such services, be deemed to be an employee of the commonwealth or, if not already an officer or enlisted person of the armed forces of the commonwealth, to be such an officer or enlisted person, or to be entitled to receive any pension or retirement allowance from the commonwealth, or to have acquired any right, or to be entitled to receive any other benefit or compensation."
General Laws c. 33, § 88, as amended through St. 1977, c. 68, in turn, provides in pertinent part: "An officer or enlisted person of the armed forces of the commonwealth, while performing any military duty lawfully ordered under any provision of this chapter, or a person not a member of the armed forces of the commonwealth, but who is the owner, or is employed by the owner of a motor vehicle lawfully loaned to or hired by the commonwealth under section eighty-nine and whose services are loaned or given to the commonwealth for any purpose set forth in said section, or a person rendering assistance to any of the armed forces of the commonwealth in connection with the use of a motor vehicle under any provision of section eighty-nine by request or order of any responsible officer of said armed forces and who by reason of such voluntary action, employment or assistance and without fault or neglect on his part, receives any injury, is disabled, or contracts any sickness or disease, incapacitating him from pursuing his usual business or occupation, shall, during the period of such incapacity, receive compensation...."
[4] Our principal difficulty in construing §§ 88 and 94 stems from the dual use of the word "services." In § 94 the word "services" seemingly is used as a generic term to indicate any of a number of "services" set forth in § 88. However, the word "services" in § 88 is specific used only for persons "whose services are loaned or given to the commonwealth for any purpose set forth in [§ 89]."
If we were to read the word "services" in § 94 to refer only to services "loaned or given," neither officers and enlisted persons in the militia nor persons "rendering assistance ... by request or order" to the militia, as described in § 88, would be included within § 94. While such an exclusion might be understandable in the case of officers and enlisted persons if they were already considered to be employees of the Commonwealth, it is not so understandable in the case of persons "rendering assistance" to the militia, since their status would be left in doubt by such a reading. Further, if "services" in § 94 were read to refer only to those persons whose services were "loaned or given," the reference in § 94 to those persons not already officers or enlisted persons would be rendered meaningless or superfluous because the reference in § 88 to persons "whose services are loaned or given" is a reference to "a person not a member of the armed forces." See Casa Loma, Inc. v. Alcoholic Beverages Control Comm'n, 377 Mass. 231, 234 (1979); Insurance Rating Bd. v. Commissioner of Ins., 356 Mass. 184, 189 (1969).
[5] The preamble also referred to the need for a "just, adequate and prompt method of acquiring and of operating motor vehicles ... and of disposing of claims ... caused by such operation."
[6] In 1954, c. 33 was restructured and recodified by St. 1954, c. 590, § 1. The substantive provisions of former §§ 55 and 55C were recodified as § 88, which was substantially the same as former § 55C with the addition of some qualifying language from former § 55.
[7] Section 55F was recodified as G.L.c. 33, § 94, by St. 1954, c. 590, § 1.
[8] In 1947, the Legislature added § 3C to c. 12. St. 1947, c. 337. The new section authorized the Attorney General to settle certain claims against "[a]ny officer or employee of the commonwealth, or of the metropolitan district commission" if that party requested representation and authorized settlement. Members of the Commonwealth's militia were not mentioned. In 1968, the Legislature amended G.L.c. 12, § 3B, to read in pertinent part as follows: "For the purpose of this section and section three C an officer, or soldier of the military forces of the commonwealth, as defined in chapter thirty-three, shall while performing any lawfully ordered military duty be deemed to be an officer or employee of the commonwealth and a motor vehicle given to the commonwealth, loaned to it or hired or purchased by it shall, while being used in the performance of any lawfully ordered military duty, be deemed to be a motor vehicle owned by the commonwealth." St. 1968, c. 207. We think that the Legislature's delay of over twenty years after enactment of G.L.c. 12, § 3C, before including members of the Commonwealth's militia within its scope indicates that the Legislature did not consider members of the militia to be public employees other than for specified, limited purposes.
In 1978, the Legislature repealed G.L.c. 12, §§ 3A-3D. St. 1978, c. 512, § 1. The subject matter of former G.L.c. 12, §§ 3A-3D, is covered in substance by G.L.c. 258, as appearing in St. 1978, c. 512, § 15 (striking out and replacing former G.L.c. 258). "[O]fficers or soldiers of the military forces of the commonwealth" are included within the definition of "[p]ublic employee" as that term is used in c. 258. G.L.c. 258, § 1.
[9] In making his decision, the trial judge ruled that the 1963 Act "supports the negative inference that persons employed by the Massachusetts National Guard that do not fall within the job categories specified in said Act are not `employees' within the meaning of G.L.c. 32, § 60" (emphasis in original). The Appeals Court held that the 1963 Act was intended only "to ensure the eligibility of these two classes of employees, perhaps civilians, whose coverage under G.L.c. 32, § 60, might otherwise have been considered in doubt." Habeeb v. Retirement Bd. of Quincy, 15 Mass. App. Ct. 902, 903 (1982). We agree with the Superior Court judge's interpretation of this act. Although Habeeb claims that such an interpretation would render the 1963 Act "obviously unconstitutional" because the Legislature could not have had a rational basis for singling out caretakers or air technicians, the record is void of facts which would support this claim. Habeeb's burden, assuming he would have standing to challenge the 1963 Act, "is not sustained by generalities, whether of law or fact. The presumption of constitutionality can be overcome only by specific allegations." Commonwealth v. Franklin Fruit Co., 388 Mass. 228, 235 (1983), quoting Commonwealth v. Chamberlain, 343 Mass. 49, 52 (1961).
[10] This rule has particular force when the statutes to be construed were enacted simultaneously, as is the case here with the 1943 legislation. See 2A C. Sands, Sutherland Statutory Construction § 51.03, at 298-299 (4th ed. 1973). See also Aldoupolis v. Commonwealth, 386 Mass. 260, 266 (1982) (amendments approved within same month of legislative session); Jones v. Wayland, supra at 118 n. 12 (statutes originally enacted on same day).
[11] Any member of the Massachusetts National Guard who qualifies as an "employee" of the Commonwealth under G.L.c. 32, § 1, is not affected by our holding. The bar of G.L.c. 33, § 94, holds only that persons who perform "services" under G.L.c. 33, § 88, should not be considered as State employees or as eligible to receive retirement benefits by reason of that service alone. Section 94 would not bar persons who were otherwise deemed State employees from receiving any retirement or other benefits for which they may be eligible. Habeeb does not argue, and no fact in the record indicates, that he would qualify as an "employee" within the definition of that term as contained in the pertinent part of G.L.c. 32, § 1.
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106 F.3d 417
Heardv.City of Warrenton, GA**
NO. 95-8105
United States Court of Appeals,Eleventh Circuit.
Jan 16, 1997
Appeal From: S.D.Ga. , No. 92-00128-CV-1
1
AFFIRMED.
**
Local Rule 36 case
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387 U.S. 571 (1967)
ELLIOTT
v.
OREGON.
No. 1144, Misc.
Supreme Court of United States.
Decided June 5, 1967.
ON PETITION FOR WRIT OF CERTIORARI TO THE SUPREME COURT OF OREGON.
PER CURIAM.
The motion for leave to proceed in forma pauperis and the petition for a writ of certiorari are granted. The judgment is vacated and the case is remanded to the Supreme Court of Oregon for further consideration in light of Anders v. California, 386 U. S. 738.
MR. JUSTICE HARLAN and MR. JUSTICE STEWART are of the opinion that certiorari should be denied.
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974 F.2d 172
Gloverv.Exxon Corporation
NO. 91-7371
United States Court of Appeals,Fifth Circuit.
Sept 04, 1992
1
Appeal From: S.D.Miss.
2
AFFIRMED.
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725 P.2d 821 (1986)
STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Plaintiff and Respondent,
v.
Graham Stuart TAYLOR, David Allen Callaway, Susan Johanna Hanson, Personal Representative of the Estate of Scott Erland Hanson, Deceased and Timothy E. Moss, Defendants and Appellants.
STATE FARM FIRE AND CASUALTY COMPANY,
v.
Susan Johanna HANSON, Personal Representative of the Estate of Scott Erland Hanson, Deceased, and Timothy E. Moss, Defendants and Appellants.
No. 86-03.
Supreme Court of Montana.
Submitted July 30, 1986.
Decided September 12, 1986.
Rehearing Denied October 21, 1986.
Poore, Roth & Robinson, C. Richard Anderson and Robert Poore both argued, Butte, for defendants and appellants.
Morrow, Sedivy & Bennett, Terry Schaplow argued, Bozeman, for plaintiff and respondent.
WEBER, Justice.
Appellants were involved in an automobile accident. The District Court for the Eighteenth Judicial District granted the motion of State Farm Fire and Casualty Company (State Farm) for summary judgment. It held that State Farm insurance policies held by Mr. Taylor and Mr. Hanson did not provide uninsured motor vehicle coverage for this accident. We reverse.
The issues are:
1. Did the State Farm policies provide uninsured motor vehicle coverage under the circumstances of this case?
2. Is State Farm absolved of liability because the insured violated the "no consent to settlement" exclusion of the insurance policies?
Mr. Hanson and Mr. Taylor were insured under State Farm automobile liability insurance policies. Mr. Taylor was driving a vehicle in which Mr. Hanson and Mr. Callaway were passengers. Their vehicle was rearended at a high rate of speed by Mr. Moss, who was driving a truck owned by *822 yet another person. As a result of the accident, Mr. Hanson died and Mr. Callaway and Mr. Taylor were severely injured. Mr. Callaway, Mr. Taylor, and Mr. Hanson's family sued Mr. Moss, and judgments were rendered. The vehicle Mr. Moss was driving was uninsured, but he personally had liability insurance. The victims settled with Mr. Moss' insurer, which paid to his policy limit, but the judgments remain partially unsatisfied.
In this action, State Farm obtained a judgment that it was not required to apply Mr. Taylor's and Mr. Hanson's uninsured motor vehicle coverage to the unsatisfied portions of the judgments. The District Court held that the State Farm uninsured motor vehicle coverage did not apply where the offending vehicle was uninsured but its driver had insurance.
I
Did the State Farm policies provide uninsured motor vehicle coverage under the circumstances of this case?
Uninsured motor vehicle insurance coverage must be offered by insurers in Montana under § 33-23-201, MCA:
No automobile liability ... policy ... for bodily injury ... arising out of the ownership, maintenance, or use of a motor vehicle shall be delivered ... in this state, with respect to any motor vehicle registered ... in this state, unless coverage is provided [in limits of $25,000 per person as set forth in § 61-6-103, MCA,] for the protection of persons insured ... who are legally entitled to recover damages from owners or operators of uninsured motor vehicles ...
There is no statutory definition of uninsured motor vehicle. Montana also requires by statute that vehicles registered and operated in the state have liability insurance coverage. Section 61-6-301, MCA.
The State Farm policy provision at issue is:
Sec. III Uninsured Motor Vehicle Coverage U. We will pay damages for bodily injury an insured is legally entitled to collect from the owner or driver of an uninsured motor vehicle. The bodily injury must be caused by accident arising out of the operation, maintenance or use of an uninsured motor vehicle.
Uninsured Motor Vehicle means:
1. a land motor vehicle, the ownership, maintenance or use of which is:
a. not insured or bonded for bodily injury liability at the time of the accident ...
State Farm argues that the plain meaning of the policy is that when the use of an offending motor vehicle is insured (as was Mr. Moss' use of the offending vehicle), the uninsured motorist coverage does not apply. State Farm has cited a number of cases in which it has been held that a vehicle is not an uninsured motor vehicle for purposes of insurance coverage if either the driver or the owner has insurance. See, e.g. Sorbo v. Mendiola (Minn.1985), 361 N.W.2d 851; Stordahl v. Government Emp. Ins. Co. (Alaska 1977), 564 P.2d 63; Citizens Ins. Co. of America v. Povey (Mich.App.1982), 319 N.W.2d 341. In none of these cases was the policy provision the same as the provision in this case. Since we conclude the language of this policy is critical, the cases cited by State Farm are not decisive.
The appellants contend that under the policy, a motor vehicle is uninsured if the ownership, maintenance or use is not insured for bodily injury. In this instance, the ownership was not insured. As a result there is a reasonable contention that under the express provision of the policy, because the ownership was not insured for bodily injury, this is an uninsured motor vehicle. The first sentence of the provision says that State Farm will pay damages an insured is legally entitled to collect from the owner or driver of an uninsured motor vehicle. If this is an uninsured motor vehicle because of the absence of insurance covering ownership, then the first sentence requires State Farm to pay its uninsured coverage because the driver of the uninsured motor vehicle caused the damages.
*823 The Washington courts have examined an insurance policy provision comparable to this one. That policy defined an uninsured motor vehicle as one "with respect to the ownership, maintenance or use of which there is ... no bodily injury insurance ..." Finney v. Farmers Ins. Co. (Wash.App. 1978), 586 P.2d 519, aff'd, 600 P.2d 1272. The court held that the policy was ambiguous and the provision was subject to more than one interpretation because of the use of the disjunctive "or," and that the clause could be interpreted to mean that a "vehicle is uninsured if there is no insurance as to either its ownership or its maintenance or its use." Finney, 586 P.2d at 526. We agree with that rationale.
An ambiguous provision in an insurance policy is construed against the insurance company. A clause in an insurance policy is ambiguous when different persons looking at it in the light of its purpose cannot agree upon its meaning. [citation omitted.] If the language is unambiguous, and subject to only one meaning, there is no basis for the interpretation of policy coverage under the guise of ambiguity.
Bauer Ranch v. Mountain W. Farm Bur. Mut. Ins. (Mont.1985), 695 P.2d 1307, 1309, 42 St.Rep. 255, 257. This policy does not clearly state whether it provides uninsured motor vehicle coverage when the driver is insured but the ownership of the vehicle is not. We conclude that the policy is ambiguous. We therefore interpret the policy to provide coverage. We hold that the State Farm policies provided uninsured motor vehicle coverage under the circumstances of this case.
II
Is State Farm absolved of liability because the insured violated the "no consent to settlement" exclusion of the insurance policies?
State Farm argues that even if this Court concludes the insurance policies provided coverage under the uninsured motor vehicle provisions, there is no insurance coverage because the appellants settled with Mr. Moss' insurance company without State Farm's consent. State Farm cites the policy provision that:
THERE IS NO COVERAGE:
1. FOR ANY INSURED WHO, WITHOUT OUR WRITTEN CONSENT, SETTLES WITH ANY PERSON OR ORGANIZATION WHO MAY BE LIABLE FOR THE BODILY INJURY.
This Court has held that an insurance policy clause which prohibited the insured from obtaining a judgment against liable parties is void. In Dominici v. State Farm Mutual Automobile Ins. Co. (1964), 143 Mont. 406, 408 and 411-12, 390 P.2d 806, 807 and 809, this Court stated:
The insurance contract further contained an exclusion whereby the above-mentioned coverage would not apply "(a) to bodily injury to an insured ... with respect to which such insured, his legal representative or any person entitled to payment under this coverage [if he or they] shall, without written consent of the company, make any settlement with or prosecute to judgment any action against any person or organization who may be legally liable therefor; ..." (Emphasis supplied.)
.....
The problem to be resolved here is what effect, if any, did the judgments taken by each plaintiff have upon the rights and obligations of the insured and insurer in light of the "no judgment" clause of the insurance contract? State Farm contends that no action can now lie against them because there has not been full compliance with the terms of the policy. Plaintiffs rely upon the prohibition contained in R.C.M. 1947, § 13-806. This statute states:
"Every stipulation or condition in a contract by which any party thereto is restricted from enforcing his rights under the contract, by the usual proceedings in the ordinary tribunals ... is void."
It is plaintiffs' position that State Farm agreed to pay all sums plaintiffs were legally entitled to recover (up to and including the limits of the policy coverage) *824 from an uninsured motorist; and, the "no judgment" clause would restrict plaintiffs from enforcing these rights. Therefore, this clause in the policy would be void under section 13-806.
We hold with the contentions of plaintiffs....
State Farm argues that the no-consent-to-settlement clause does not restrict insureds' access to the courts and thus does not violate the Dominici rule. Instead, State Farm argues, it protects the insurer's right of subrogation. It is technically correct that the holding in Dominici was that the "no judgment" provision unlawfully restricted the plaintiff's access to the courts. A "no settlement" clause does not directly limit access to the courts. However, the rationale in Dominici was that the "no judgment" clause would restrict the insureds from enforcing their rights under the insurance contract.
"This Court does not support provisions placed on uninsured motorist coverage which restrict or thwart available liability coverage that the insured would be entitled to in an accident." Guiberson v. Hartford Cas. Ins. Co. (Mont.1985), 704 P.2d 68, 74, 42 St.Rep. 1196, 1203. In Guiberson, this Court nullified an insurance policy provision which would have denied uninsured motor vehicle coverage where the uninsured driver did not have the insured's consent to operate the vehicle. We conclude that enforcement of the no-consent-to-settlement clause here would result in a backing away from the mandatory offering requirement of the uninsured motor vehicle statute. It would also place control of efforts to collect from the responsible party in the hands of the insurer.
The central purpose of the clause is to provide uninsured motor vehicle coverage for which the insured has paid a premium. The insurance company is obligated to furnish uninsured motor vehicle coverage, whether it can obtain subrogation or not. While we do not deny the insurer's right to subrogation, we will not allow the right to subrogation to negate the required offering of uninsured motor vehicle coverage. Under these circumstances, we conclude that the no-consent-to-settlement clause is void.
We therefore reverse the decision of the District Court.
TURNAGE, C.J., and HARRISON, MORRISON and HUNT, JJ., concur.
SHEEHY, Justice, specially concurring:
I concur in the foregoing opinion and wish to add other reasons for my concurrence in the result.
There are two types of uninsured motor vehicle statutes. One type is called the mandatory insured motorist statute, wherein it is required that every motor vehicle policy of insurance includes such coverage. Seventeen states have this type of coverage. The other type of uninsured motorist coverage is the "mandatory offerings statutes" of which Montana's statute is typical. According to 1 Widiss, Uninsured and Underinsured Motorist Insurance § 2.5 (2d ed. 1985), there are thirty-three states which mandate that uninsured motorist coverage be offered in every policy of liability insurance in the state.
The second thing to note is that there is a significant difference between most of the statutes requiring uninsured motorist coverage and the statute that is provided in Montana. Most of the statutes of the other states refer to the "uninsured motorist" but Montana's statute refers to the uninsured motor vehicle. The pertinent language in § 33-23-201, MCA is:
No automobile liability ... policy shall be delivered or issued for delivery in this state ... unless coverage is provided therein or supplemental thereto ... for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness or disease, including death, resulting therefrom. (Emphasis supplied.)
The term "uninsured motor vehicles" is unqualified in the statute, is unambiguous, and needs no interpretation. It is a matter *825 of public policy that such coverage be mandatorily offered and if the coverage offered is less than what is mandated by our statute, the public policy requirement has not been met. Section 33-23-201, MCA.
An example of a different kind of uninsured motorist statute can be found in Kansas. There, the provisions of Kan.Stat. Ann. § 40-284(a) (Supp.1985) state:
No automobile liability insurance policy... shall be delivered or issued for delivery in this state ... unless the policy contains or has endorsed thereon, a provision... for payment of part or all sums which the insured or the insured's legal representative shall be legally entitled to recover as damages from the uninsured owner or operator of the motor vehicle because of bodily injury, sickness or disease, including death, resulting therefrom, sustained by the insured, caused by accident and arising out of ownership, maintenance or use of such motor vehicle ... (Emphasis supplied.)
It requires no great intellectual skill to determine that the Kansas statute is directed to the status of the driver or operator as uninsured, whereas the Montana statute is directed to the status of the uninsured motor vehicle. The difference is critical in this case, because although the use of the uninsured motor vehicle in this case was insured by the driver's separate insurance policy, and thus would qualify under the Kansas statute, the Montana statute has no reference to ownership, maintenance or use and such terms cannot be used to diminish the mandated offered coverage that Montana requires under § 33-23-201, MCA.
As to the application of the statute therefore, I would hold in this case that under a Montana statute, if the motor vehicle itself is uninsured, then the uninsured motor vehicle coverage of the other vehicles attaches and coverage is extended to its insureds under the uninsured motor vehicle coverage.
There are other results commanded by our decision here which are not discussed for the reason that they have not yet been before the Court. For reasons that should appear clear to counsel on remand, it seems to me that the medical payments coverage should be reduced by the amount recovered under the liability insurance policy that was issued to the driver to the extent that such reduction does not reduce the recovery from State Farm below the sum of $55,000. In other words, the $100,000 received from the insurance on the driver would be used to reduce the medical payments coverage in this State Farm policy.
GULBRANDSON, Justice, dissenting.
I respectfully dissent.
The majority cite only a Washington Supreme Court opinion wherein a comparable insurance policy provision was held to be ambiguous. Finney v. Farmers Ins. Co. (Wash.1979), 600 P.2d 1272.
The majority agreed with the rationale expressed therein, and I perhaps would do the same if this case were to be decided under Washington law. The author of Finney clearly indicated that that opinion does not cover the factual situation before this Court:
... nor are we confronted with a factual situation in which the only responsible party was insured under a policy which extended coverage for the accident in question. Here there are two responsible parties, one of which was uninsured, the other underinsured. The use of the word "or" is disjunctive. 1A C. Sands, Sutherland Statutory Construction § 21.14 (4th ed. 1972). Childers v. Childers, 89 Wash.2d 592, 575 P.2d 201 (1978). We are persuaded that the legislature intended to provide uninsured motorist protection where either one of the responsible parties lacks insurance coverage. (Emphasis added.)
.....
Under Washington law, where the ownership of an automobile is admitted and the owner is a passenger, there arises a presumption that, at the time of the accident, the driver was operating the vehicle as the agent or servant of the owner.
*826 (Citing cases.) The owner is vicariously liable for the driver's negligence. Moffitt v. Krueger, supra; Coins v. Washington Motor Coach Co., 34 Wash.2d 1, 208 P.2d 143 (1949).
Finney, 600 P.2d at 1275-1276.
Finney cited Allstate Ins. Co. v. Chastain (Fla.1971), 251 So.2d 354, as authority for its position, but correctly stated that in that case the uninsured owner was liable under Florida's dangerous instrumentality doctrine.
In this case, there is no suggestion that the uninsured owner was a responsible party and I therefore consider the Finney citation to be inadequate authority.
The trial judge, in granting summary judgment for the respondent, relied upon the rationale expressed in Sorbo v. Mendiola (Minn.1985), 361 N.W.2d 851, and stated:
I frankly have been tempted by the plight of the defendants to hold that the policies in question are ambiguous, thereby granting the benefit of the doubt to the defendants. But I find it is sufficiently clear that the liable person, the driver Moss, has insurance and the defendants were not struck by an uninsured motorist.
In my view, the policy definition of "uninsured motor vehicle" as a land motor vehicle, the use of which is not insured, is not ambiguous and I would affirm the order of the trial judge.
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258 N.W.2d 598 (1977)
STATE of Minnesota, Appellant,
v.
William Charles WICKS (47335), Respondent,
Grant Virgil Guerri (47336), Respondent,
Jerry Ewald Karger (47337), Respondent,
Richard Eugene Koenig (47338), Respondent,
Dennis Carl Swanson (47339), Respondent,
Scott Glen Davis (47340), Respondent.
STATE of Minnesota, Plaintiff,
v.
Larry William THORSON (47455) Defendant.
Nos. 47335-47340 and 47455.
Supreme Court of Minnesota.
September 16, 1977.
*599 Warren Spannaus, Atty. Gen., St. Paul, Gary W. Flakne, County Atty., Vernon E. Bergstrom, Chief, Appellate Division, David W. Larson and Phebe S. Haugen, Asst. County Attys., and Lee Barry, Law Clerk, Minneapolis, for appellant.
Robert W. Johnson, County Atty., Dan M. Kammeyer, Asst. County Atty., Anoka, for plaintiff.
Joseph Kaminsky, Minneapolis, for Wicks and Guerri.
Richard E. Olson, Minneapolis, for Karger.
William R. Kennedy, Hennepin County Public Defender, Kevin Johnson, Asst. Public Defender, Minneapolis, for Koenig.
William R. Kennedy, Hennepin County Public Defender, E. George Widseth, Asst. Public Defender, for Swanson.
William R. Kennedy, Hennepin County Public Defender, Barbara J. Britt, Asst. Public Defender, for Davis.
Craig D. Larson, Champlin, for Thorson.
Warren Spannaus, Atty. Gen., Robert W. Johnson, County Atty., and Dan M. Kammeyer, Asst. County Atty., for respondent state.
Heard before PETERSON, MacLAUGHLIN, and PLUNKETT, JJ., and considered and decided by the court en banc.
PETERSON, Justice.
These seven consolidated appeals present a single issue of statutory construction. Defendants were each charged with violation of the so-called Aggravated Violations Statute, Minn.St. 171.245, which makes it a gross misdemeanor to operate a motor vehicle while under the influence of alcohol and "while the driver's license or driver's privilege is cancelled, suspended or revoked * * * because of the operation of a motor vehicle while the person was under the influence of alcohol * * *."[1] In each case, the defendant had been convicted of driving while under the influence, Minn.St. 169.121; the Department of Public Safety, pursuant to Minn.St. 171.17(2), had sent notification to the defendant that his driver's license or driver's privilege had been revoked as a consequence of that conviction; the notice of revocation specified a period of between 30 and 90 days after which the defendant would be eligible to apply for a new license; the specified period of ineligibility had expired, but the defendant had not completed his application for a new license and none had been issued when he was again arrested for driving under the influence. These prosecutions resulted.
The state appeals from an order of the Hennepin County District Court dismissing six of the cases following the trial court's ruling that § 171.245 should be limited in application to those instances where drivers are arrested for driving under the influence during the period of ineligibility for a new license. In the seventh case, the Anoka County District Court, with defendant's consent, certified to this court the following question:
"May a defendant be convicted of a violation of Minnesota Statutes 171.245, when his driver's license or driver's privileges have been revoked for a fixed period of time (for example, 30 or 60 or 90 *600 days), and said period of time has elapsed, but no license or privilege has been applied for or issued?" (Italics supplied.)
The italicized phrase would have been more accurately stated, however, were it to read "when he is ineligible to apply for a new driver's license or privilege," and for purposes of this opinion it will be so considered. The certified question is answered in the affirmative, and the order to dismiss in the six other cases is reversed.
As a preliminary matter, we note that the six appeals are properly before us under Rule 29.03, subd. 1, Rules of Criminal Procedure, which authorizes the prosecuting attorney to appeal to this court
"1. in any felony or gross misdemeanor case, as of right, from any pretrial order of the district court, * * *
* * * * * *
except an order dismissing a complaint for lack of probable cause to believe the defendant has committed an offense * * *."
The certified question is properly before us under Rule 29.02, subd. 4, Rules of Criminal Procedure, which provides in part:
"If, upon the trial of any person convicted in any district court, or if, upon any motion to dismiss a complaint or indictment, or upon any motion relating to the indictment or complaint, any question of law shall arise which in the opinion of the judge is so important or doubtful as to require a decision of the Supreme Court, he shall, if the defendant shall request or consent thereto, report the case, so far as may be necessary to present the question of law, and certify the report to the Supreme Court, whereupon all proceedings in the case shall be stayed until the decision of the Supreme Court."
Although the trial court failed to rule on the question before certifying it to us, we have recently held that review upon certification in a criminal case is proper notwithstanding the trial court's failure to pass on the question.[2]State v. Reps, 302 Minn. 38, 223 N.W.2d 780 (1974). The question is properly certified under the criteria which we discussed in Thompson v. State, 284 Minn. 274, 170 N.W.2d 101 (1969): It does not present a hypothetical question or request an advisory opinion but will have an immediate effect on the prosecution which has been stayed pending our determination; it does not require us to assume a set of facts not on the record; it was distinctly and clearly presented on the basis of a record sufficiently developed so that the question is relevant and presents a substantive issue.
Only three defendants filed briefs on appeal. Defendant Larry William Thorson argues that at the time of his arrest, his license or privilege to drive was no longer under revocation within the meaning of § 171.245. He construes the word "revoked" in that statute to refer only to that period of time specified in the notice of revocation during which no new license may be issued to him. Defendant Scott G. Davis, joined by defendant Dennis C. Swanson,[3] contends not that his license was not revoked at the time he was arrested, but that it was
"* * * no longer revoked because of the driving under the influence conviction within the meaning of the Aggravated Violations Law. After the termination of the time period stated in the [notice] during which he was ineligible to get his license reinstated, the revocation continued solely because he failed to complete all the steps required to get his license reinstated."
*601 In the memorandum in support of its order to dismiss, the trial court stated:
"In each of the cases at bar Defendant's driver's license had been revoked by Department of Public Safety for a fixed period of time, 30 or 60 days, and although that fixed period of time had elapsed at the time of arrest, none of the defendants had obtained a valid license as allowed by statute.
"The narrow legal issue thus presented is whether, for the purposes of the new Aggravated Violations Law, revocation under Minn.Stat. §§ 169.121, .123, or 171.17 for a definite period of time shall be deemed to continue at the end of that fixed period until a valid license is obtained. * * *
"There is no doubt that the statute is not perfectly clear on this question."
This reasoning begs the question by describing the revocation as "for a fixed period of time" equal to the period specified in the revocation notices during which one is ineligible for a new license. The question before us is precisely for what period of time is a license or privilege to drive revoked, within the meaning of the statute, because of the operation of a motor vehicle while under the influence of alcohol.
The revocation notices do not simply state "license revoked for 30 [or 60 or 90] days." After declaring that "Your Minnesota Driver License or privilege to operate a Motor Vehicle is hereby REVOKED X," the notice specifies the reason for the revocation and states several "requirements" which are prerequisites to the issuance of a new license. The expiration of a specified number of days after surrender of the license is only one of the possible requirements. Other requirements include passing a complete driver license test; payment of a fee of $2.50 for each examination; completion of a driver improvement clinic. We hold that when a license or privilege is revoked because of driving under the influence, it continues to be revoked within the meaning of § 171.245 until a new license is issued.[4]
The certified question is answered in the affirmative and the case remanded; the order to dismiss the other six cases is reversed.
NOTES
[1] Minn.St. 171.245 provides in part: "Any person who operates a motor vehicle, the operation of which requires a driver's license, upon the highways in this state in violation of section 169.121 while the driver's license or driver's privilege is cancelled, suspended or revoked (1) because of the operation of a motor vehicle while the person was under the influence of alcohol or a narcotic drug; or while the person's blood had an alcohol content above a prescribed level * * * is guilty of a gross misdemeanor."
[2] As a matter of policy, it is probably preferable for the trial court to rule on the question. In this case, we do have the benefit of the reasoning of the other trial court in its order to dismiss.
[3] As an alternative basis upon which to affirm the trial court's order, Dennis C. Swanson argues that he never received a revocation notice and that the statutory provisions for mailing notice of revocation fail to comply with due process. No evidence was adduced at the trial court level on either of these issues and no ruling made by the trial court. Swanson will be entitled to a hearing and a ruling on the issues on remand.
[4] Resort to decisions of other states construing their own similar statutes is usually of minimal assistance. We do note that two other states have reached the same result: People v. Lopez, 143 Colo. 523, 525, 354 P.2d 491, 492 (1960) ("[U]ntil a new license has been granted one that has been previously revoked continues revoked") and City and County of Denver v. Palmer, 140 Colo. 27, 29, 342 P.2d 687, 688 (1959); State v. Brude, 222 N.W.2d 296, 298 (N.D.1974) (a statute arguably more favorable to the defendant, but nevertheless construed adversely to him).
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NO. 12-15-00180-CR
IN THE COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT
TYLER, TEXAS
IN RE: §
DONALD ADKINS, § ORIGINAL PROCEEDING
RELATOR §
MEMORANDUM OPINION
PER CURIAM
Appearing pro se, Relator Donald Adkins has filed a petition for writ of mandamus. He
asserts that he has repeatedly but unsuccessfully attempted to invoke his constitutional right to a
speedy trial. He contends that the district attorney of Sabine County and the judge of the 273rd
Judicial District Court of Sabine County have deprived him of this right. He concludes that a
writ of mandamus directing the dismissal of the pending charges against him is his only available
remedy. We dismiss the petition in part and deny it in part.
This Court’s mandamus authority is limited to (1) a judge of a district or county court in
the court of appeals district; (2) a judge of a district court who is acting as a magistrate at a court
of inquiry under Texas Code of Criminal Procedure Chapter 52 in the court of appeals district; or
(3) a situation in which a writ of mandamus is necessary to protect this Court’s jurisdiction.
TEX. GOV’T CODE ANN. § 22.221(a), (b) (West 2004). The district attorney is not a judge, and
Relator has not alleged that a writ of mandamus against the district attorney is necessary to
protection this Court’s jurisdiction.
Moreover, to obtain mandamus relief in a criminal matter, the relator must show that he
has no adequate remedy at law to redress his alleged harm and that what he seeks to compel is a
ministerial act, not involving a discretionary or judicial decision. State ex rel. Young v. Sixth
Judicial Dist. Court of Appeals at Texarkana, 236 S.W.3d 207, 210 (Tex. Crim. App. 2007)
(orig. proceeding). Here, Relator seeks an order directing the respondents “to comply with the
mandates set forth by the constitution in the Promise of Due Process and a fast and speedy trial
and dismiss with prejudice all counts held against the Relator being called a complaint, warrant,
indictment et-cet[era]” as listed in Section III of his mandamus petition. A defendant seeking to
compel a dismissal of an indictment on speedy trial grounds has an adequate remedy at law.
Smith v. Gohmert, 962 S.W.2d 590, 592-93 (Tex. Crim. App. 1998) (orig. proceeding).
Therefore, mandamus is not available to compel the dismissal.
CONCLUSION
Relator’s allegations against the Sabine County district attorney do not fall within this
Court’s mandamus jurisdiction. Consequently, we have no authority to consider the merits of
Relator’s mandamus petition insofar as it pertains to the district attorney. Relator has failed to
establish that he has no adequate remedy at law to obtain the dismissal he requests. Therefore,
he has not shown he is entitled to mandamus relief against the respondent trial judge.
Accordingly, we dismiss Relator’s petition for writ of mandamus as to the Sabine County district
attorney and deny the petition as to the judge of the 273rd Judicial District Court of Sabine
County. All pending motions are overruled as moot.
Opinion delivered November 9, 2016.
Panel consisted of Worthen, C.J., Hoyle, J., and Neeley, J.
(DO NOT PUBLISH)
2
COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT OF TEXAS
JUDGMENT
NOVEMBER 9, 2016
NO. 12-15-00180-CR
DONALD ADKINS,
Relator
V.
HON. CHARLES R. MITCHELL AND J. KEVIN DUTTON,
Respondents
ORIGINAL PROCEEDING
ON THIS DAY came to be heard the petition for writ of mandamus filed
by DONALD ADKINS. Said petition for writ of mandamus having been filed herein on July
13, 2015, and the same having been duly considered, because it is the opinion of this Court that a
writ of mandamus should not issue, it is therefore CONSIDERED, ADJUDGED and ORDERED
that the said petition for writ of mandamus as to the Sabine County district attorney, J. KEVIN
DUTTON, be, and the same is, hereby DISMISSED; that the said petition for writ of mandamus
as to the judge of the 273rd Judicial District Court of Sabine County, CHARLES R.
MITCHELL, be, and the same is hereby DENIED.
By per curiam opinion.
Panel consisted of Worthen, C.J., Hoyle, J. and Neeley, J.
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914 F.2d 1490Unpublished Disposition
NOTICE: Fourth Circuit I.O.P. 36.6 states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Fourth Circuit.Timothy E. FINLEY, Plaintiff-Appellant,v.Michael J. CAVANAUGH, Carl N. Lundberg, Defendants-Appellees.
No. 90-6613.
United States Court of Appeals, Fourth Circuit.
Submitted Aug. 27, 1990.Decided Sept. 26, 1990.Rehearing and Rehearing In Banc Denied Oct. 31, 1990.
Appeal from the United States District Court for the District of South Carolina, at Columbia. Falcon B. Hawkins, Chief District Judge. (CA-89-2434-CA)
Timothy E. Finley, appellant pro se.
Carl Norman Lundberg, South Carolina Department of Probation, Parole & Pardon Service, Columbia, S.C., for appellees.
D.S.C.
AFFIRMED.
Before SPROUSE and WILKINS, Circuit Judges, and BUTZNER, Senior Circuit Judge.
PER CURIAM:
1
Timothy E. Finley appeals from the district court's order denying relief under 42 U.S.C. Sec. 1983. Our review of the record and the district court's opinion accepting the recommendation of the magistrate discloses that this appeal is without merit. Accordingly, we affirm on the reasoning of the district court. Finley v. Cavanaugh, CA-89-2434-CA (D.S.C. June 27, 1990). We dispense with oral argument because the facts and legal contentions are adequately presented in the materials before the Court and argument would not aid the decisional process. The motion for appointment of counsel and the motion to dismiss the appeal as moot are denied.
2
AFFIRMED.
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257 F.3d 815 (D.C.Cir. 2001)
Lisa K. Russell, Appellantv.Anthony J.Principi, Secretary of Veterans Affairs, Appellee
No. 00-5172
United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued May 4, 2001Decided July 27, 2001
Appeal from the United States District Court for the District of Columbia (No. 97cv00749)
Mark G. Chalpin argued the cause and filed the briefs for appellant.
David J. Ball, Jr., Assistant U.S. Attorney, argued the cause for appellee. With him on the brief were Wilma A. Lewis, U.S. Attorney at the time the brief was filed, and R. Craig Lawrence, Assistant U.S. Attorney.
Before: Williams, Ginsburg and Rogers, Circuit Judges.
Opinion for the Court filed by Circuit Judge Rogers.
Rogers, Circuit Judge:
1
The principal issue in this appeal is whether Lisa K. Russell presented a prima facie case of reverse discrimination by alleging an adverse employment action under Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e et seq. Russell alleged that the Department of Veterans Affairs engaged in reverse discrimination in violation of Title VII by awarding her a lower performance rating and a smaller cash bonus than her similarly-situated coworker. In Brown v. Brody, 199 F.3d 446, 452 (D.C. Cir. 1999), the court rejected the argument that "poor performance evaluations are necessarily adverse actions." Relying on Brown, the district court granted the Department's motion for summary judgment on the ground that Russell had not shown that she suffered an adverse employment action. We hold that the loss of a bonus can constitute an adverse employment action under Title VII and, therefore, reverse the grant of summary judgment. As to Russell's challenges to certain orders as abuses of discretion, we affirm in part and remand in part. We deny Russell's belated request to plead a new cause of action for bad faith litigation abuse.
I.
2
Lisa K. Russell, a GS 13 procurement analyst, sued the Department of Veterans Affairs for reverse discrimination after her work performance for the period 1992-93 was rated "excellent" and she received a bonus of $807, while Sherry Patton, her coworker, was rated "outstanding" and received a bonus of $1,355. Russell is Caucasian; Patton is African American. "Outstanding" was the highest of five possible ratings; "excellent" was the second highest rating. The size of the bonus was tied to the rating. Russell alleged that her work performance and qualifications were superior to those of Patton, and that her supervisors had engaged in a pattern of preferential treatment of Patton based on her race. Russell further alleged that her "excellent" rating was adverse because it damaged her chances for promotion and provided her with less protection "against being laid off during a government 'reduction in force,' or RIF, pursuant to a formula outlined by the Office of Personnel Management." The parties filed cross motions for summary judgment, and the district court granted summary judgment for the Department on the ground that Russell had not made out a prima facie case of disparate treatment discrimination under Title VII, as stated in Brown. The district court ruled that neither Russell's performance rating nor her bonus, even if lower than she allegedly deserved, could be considered adverse actions. As to her promotion claim, the district court noted that Russell had not offered any evidence that she was denied a promotion opportunity or that the performance rating would have affected her current grade and step position. The district court also rejected Russell's RIF argument as moot as of the time of its ruling on summary judgment, because only Russell's last three performance evaluations could affect how she would fare during a RIF.
II.
3
Applying the familiar test of McDonnell Douglas v. Green, 411 U.S. 792, 802 (1973), the court in Brown stated that to establish a prima facie case for disparate treatment discrimination "[i]n federal as in private employment cases ... the plaintiff must establish that (1) she is a member of a protected class; (2) she suffered an adverse employment action; and (3) the unfavorable action gives rise to an inference of discrimination." Brown, 199 F.3d at 452; see also McDonnell Douglas, 411 U.S. at 802. A plaintiff who alleges reverse discrimination must, in addition, demonstrate "additional 'background circumstances [that] support the suspicion that the defendant is that unusual employer who discriminates against the majority.' " Harding v. Gray, 9 F.3d 150, 153 (D.C. Cir. 1993) (quoting Parker v. Baltimore & Ohio R.R., 652 F.2d 1012, 1017 (D.C. Cir. 1981)). In Brown, the court observed that a "thick body of precedent ... refutes the notion that formal criticism or poor performance evaluations are necessarily adverse actions." Brown, 199 F.3d at 458. The court held that a " 'fully satisfactory' performance rating [was not] an adverse employment action ... [because although it] may have been lower than normal, it was not adverse in an absolute sense." Id. Russell contends that the district court erred in granting summary judgment to the Department both because Brown did not hold that performance evaluations can never constitute adverse actions and because her case is distinguishable as she consequently received a lower bonus than her similarly situated coworker and was subjected to a greater risk of being RIFed than her coworker. The Department responds that Russell's " 'excellent' rating cannot be characterized as adverse because her rating was favorable, not negative or even neutral as in Brown." Our review of the grant of summary judgment is de novo. See id.
4
The Supreme Court has described the concept of a "tangible employment action" as "a significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits." Burlington Indus., Inc. v. Ellerth, 524 U.S. 742, 761 (1998). Thus, "[w]hile adverse employment actions extend beyond readily quantifiable losses, not everything that makes an employee unhappy is an actionable adverse action. Minor and even trivial employment actions that 'an irritable, chip-on-theshoulder employee did not like would otherwise form the basis of a discrimination suit.' " Smart v. Ball State Univ., 89 F.3d 437, 441 (7th Cir. 1996) (quoting Williams v. BristolMyers Squibb Co., 85 F.3d 270, 274 (7th Cir. 1996)). We take no issue with the "objectively tangible harm" requirement, which guards against both "judicial micromanagement of business practices," Mungin v. Katten, Muchin & Zavis, 116 F.3d 1549, 1556 (D.C. Cir. 1997), and frivolous suits over insignificant slights. Performance evaluations are likely to be "[i]nterlocutory or mediate decisions having no immediate effect upon employment." Id. at 1555. The result of an evaluation is often speculative, making it difficult to remedy. For example, a single poor evaluation may drastically limit an employee's chances for advancement, or it may be outweighed by later evaluations and be of no real consequence. This reasoning is reflected in Brown where the court suggested that performance evaluations should not be considered adverse actions if they did not "affect[ ] the [employee's] grade or salary," and analogized performance evaluations to lateral transfers, which are not actionable injuries unless they "affect[ ] the terms, conditions, or privileges of [an employee's] employment or her future employment opportunities such that a reasonable trier of fact could conclude that the plaintiff has suffered objectively tangible harm." Brown, 199 F.3d at 457. In contrast, a bonus is a tangible, quantifiable award, more analogous to one's salary or to a benefit of one's employment than to a performance evaluation. It has a more direct, measurable, and immediate effect. Furthermore, the loss of a bonus that is worth hundreds of dollars is not a petty detriment.
5
The Department nonetheless suggests that Brown controls because Russell's "excellent" rating and $807 bonus, although both lower than Russell believed she deserved, were "not adverse in an absolute sense." Id. at 458. Because we do not equate performance evaluations and monetary bonuses, the Department's reasoning fails. Furthermore, the logic of an action that is "adverse in an absolute sense" fits poorly with employment decisions involving bonuses. The denial of a bonus, or the award of a lesser bonus for discriminatory reasons, could never be considered "adverse in an absolute sense." A performance evaluation can drop below an average, but a bonus cannot be negative. The perverse logical conclusion of the Department's reasoning is that an employer could award $500 bonuses to all white employees and $1 bonuses to all similarly situated black employees without running afoul of Brown, because under such a discriminatory scheme no employee would be worse off in an absolute sense. We decline to extend Brown in this manner. Rather, we view Brown's language about absolute deprivations as simply stating that in most circumstances performance evaluations alone at the satisfactory level or above should not be considered adverse employment actions.
6
The Department also urges us to rely on Rabinovitz v. Pena, 89 F.3d 482 (7th Cir. 1996), a case cited with approval in Brown. In Rabinovitz, the plaintiff claimed that he was given a "fully successful" rather than an "exceptional" performance appraisal, which "prevented him from receiving a $600 bonus." Id. at 488. The Seventh Circuit held that "the loss of a bonus is not an adverse employment action in a case such as this where the employee is not automatically entitled to the bonus." Id. at 488-89. The Department maintains in its brief that Russell "actually received more favorable treatment" than Rabinovitz because "she received a higher 'excellent' rating" and an award that was "only $548 less than that received by her co-worker with the highest possible rating."
7
In Brown, the court had no occasion to address whether a performance rating accompanied by a bonus differential was actionable. Brown can properly be understood, therefore, as citing Rabinovitz only to "refute[ ] the notion that formal criticism or poor performance evaluations are necessarily adverse actions." Brown, 199 F.3d at 458. As for the precise holding of Rabinovitz, the phrase "not automatically entitled to the bonus" is not entirely clear but appears to mean that the amount of the bonus Rabinovitz could have received was entirely discretionary. By contrast, the Department conceded at oral argument that the size of Russell's bonus was directly tied to her performance rating; a higher rating would have automatically meant a larger bonus. Regardless of the factual differences between the two cases, however, we reject the notion that a denial of a monetary bonus is not a cognizable employment action under Title VII.
8
For these reasons, we hold that summary judgment was inappropriate because Russell presented a prima facie case of reverse discrimination under Title VII based on an adverse employment action. To the extent, however, that Russell relies on her temporary exposure to a higher risk of RIF, we hold that such an unrealized risk of a future adverse action, even if formalized, is too ephemeral to constitute an adverse employment action; as the district court noted, "while the disputed rating might have affected [Russell's] chances of being '[RIF]ed' at an earlier date, it cannot affect her chances now."
III.
9
Russell also challenges a series of orders by the district court for which our review is for abuse of discretion. See Shepherd v. Am. Broad. Cos., 62 F.3d 1469, 1475 (D.C. Cir. 1995) (sanctions); Carey Canada, Inc. v. Columbia Cas. Co., 940 F.2d 1548, 1559 (D.C. Cir. 1991) (discovery). We find either no abuse of discretion or no need to make such a finding inasmuch as the discovery issues will need to be addressed on remand, in light of our reversal of the grant of summary judgment. Much of Russell's brief and the record she supplied on appeal address her claims that the Department mishandled and destroyed evidence that would show that her coworker was not entitled to the outstanding performance rating and larger bonus, and that she was entitled to attorneys fees. We are unable to determine on the basis of this record whether some of the district court's rulings denying Russell's motion for sanctions and certain discovery requests were influenced by its interpretation of Brown. Furthermore, some of the district court's rulings appear to rely on its earlier dismissal of Russell's Bivens claims; the relevance of that dismissal is unexplained.
10
Insofar as Russell contends that the district court erred in not awarding costs and attorneys fees after directing the Department not to destroy records, she has misconstrued the district court's ruling. The district court's statements provide no basis to conclude that the district court made the necessary predicate finding of bad faith. The district court judge stated: "Although I don't think it is necessary, I will direct the Government not to destroy any documents that are relevant to this case." Russell's counsel indicated that he was satisfied with this ruling. On appeal, Ms. Russell interprets the judge's remark as a sanction against the Department under the district court's inherent powers. Hardly. By saying "I don't think it is necessary," the judge was indicating that he found little or no merit to the motion and that he did not believe that the Department was destroying evidence. The district court did not find that the Department had acted in bad faith in destroying records, and absent such a finding, there was no basis for the award of monetary sanctions. See Shepherd, 62 F.3d at 1475; United States v. Wallace, 964 F.2d 1214, 1219 (D.C. Cir. 1992). Thus, Russell provides no ground on which the court could conclude that the district court abused its discretion in denying costs and attorneys fees.
11
Russell's contention that the district court abused its discretion in denying her motion for sanctions for bad faith litigation abuses without an evidentiary hearing fares no better. She presents no basis for concluding that the district court abused its discretion in proceedings without such a hearing. See LaPrade v. Kidder Peabody & Co., Inc., 146 F.3d 899, 904 (D.C. Cir. 1998). Indeed, she argued in the district court that no hearing was needed because the evidence was clear. To the extent that Russell also contends that the district court erred in failing to impose sanctions, we remand this issue. The district court gave no reasons in its order denying the motion for sanctions, and thus this court cannot determine how the district court resolved the parties' disputed claims of material fact. See Lyles v. United States, 759 F.2d 941, 942 (D.C. Cir. 1985).
12
Regarding discovery, the district court will need to reassess, in light of our reversal of the grant of summary judgment, the relevance of Russell's motion to compel discovery responses to five interrogatories, which pertained to the handling of a letter that she sent concerning the safeguarding of records, the disposition of telephone records, alleged document destruction by Department attorneys, Department action to preserve telephone records, and Department policies and procedures to preserve records. To the extent relevant to Russell's claim of disparate treatment, the discovery requests may be meritorious. To the extent they relate to her motion for sanctions for litigation abuse that the district court properly denies, there may be no basis for granting the requests. We leave these matters to the district court on remand, to proceed as is appropriate, recognizing that the district court may ultimately conclude that its prior discovery rulings should stand.
13
Finally, Russell's effort to pursue an independent cause of action for bad faith litigation abuse against the Department fails. As Russell acknowledges, to date no circuit court has held that a federal cause of action exists. Because she did not raise this issue in the district court and does not show on appeal that "a manifest injustice might otherwise result," Herbert v. National Academy of Sciences, 974 F.2d 192, 196 (D.C. Cir. 1992), we decline to decide now whether such a federal cause of action exists.
14
Accordingly, we reverse the grant of summary judgment for failure to present a prima facie case under Title VII, and remand the case for further proceedings; we deny the request to plead a new cause of action.
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713 F.2d 1396
Eldon E. BELL, Appellee,v.Chester SELLEVOLD, Alvin Block, Ardis Abbott, Orville Hein,and Charles Hesla, individually and as members of the Boardof Commissioners of Day County, South Dakota; and DayCounty, an organized county of the State of South Dakota,Appellants.In re DAY COUNTY, SOUTH DAKOTA, Petitioner.
Nos. 83-1168, 83-1235.
United States Court of Appeals,Eighth Circuit.
Submitted May 18, 1983.Decided Aug. 15, 1983.Rehearing and Rehearing En BancDenied Sept. 15, 1983.
David A. Gerdes, May, Adam, Gerdes & Thompson, Pierre, S.D., and Thomas E. Klinkel, Richardson, Groseclose, Kornmann, Wyly, Wise & Klinkel, Aberdeen, S.D., for appellee.
Edwin E. Evans, Michael J. Schaffer, Davenport, Evans, Hurwitz & Smith, Sioux Falls, S.D., and Leon J. Vander Linden, State's Atty., Day County, Webster, S.D., for appellants and petitioner.
Before ROSS, ARNOLD and JOHN R. GIBSON, Circuit Judges.
ARNOLD, Circuit Judge.
1
This case involves the efforts of Day County, South Dakota, to evict Eldon E. Bell, M.D., from space he has been using in a medical clinic in Webster, South Dakota, owned by the county. The governing body of the county, the Board of County Commissioners, brought an action against Dr. Bell in a state court for forcible entry and detainer, claiming that he was holding over wrongfully after expiration of a lease. Dr. Bell then brought this suit in the United States District Court for the District of South Dakota, claiming, among other things, that the county was depriving him of property (his right to use and occupy the clinic) and liberty (his reputation as a physician) without due process of law. The District Court granted Dr. Bell's motion for preliminary injunction and forbade the defendants to do anything to dispossess him (including prosecuting the state-court action) until the case could be tried on its merits in the federal court. Because we believe that defendants have not deprived Dr. Bell of either liberty or property, we reverse.
I.
2
Dr. Bell came to Webster in 1969. By all accounts, he is an exemplary physician and surgeon, and no one on either side of this controversy questions either his integrity or his medical ability and judgment. Since coming to Webster, he has been a member of the professional staff of the Day County Hospital, operated by the county under S.D. Codified Laws Ann. §§ 34-8-1 to -23 (1977 & Supp.1982). He has also used as his office for the practice of medicine space in a clinic owned by the county. In September of 1982, the Board of County Commissioners became dissatisfied with what it felt was "turmoil" among the physicians occupying the clinic. The details of the personal differences among the parties are not immediately material for present purposes. Suffice it to say that the Board thought, for whatever reason, that Dr. Bell was chiefly responsible for the "turmoil." On September 19, 1982, the Board voted to terminate the leases of all but one of the four physicians at the clinic, including Dr. Bell. After at least two more meetings, the Board relented as to two of the three terminated tenants, but it refused to change its mind as to Dr. Bell. On November 23, the Board sued Dr. Bell in the Circuit Court for the Fifth Judicial District of South Dakota. The action was brought under the South Dakota forcible-entry-and-detainer statutes, S.D. Codified Laws Ann. §§ 21-16-1 to -12 (1979).
3
On December 10, 1982, before any proceedings of substance had occurred in the state court, Dr. Bell brought this suit. His complaint alleged claims under 42 U.S.C. § 1983, 42 U.S.C. § 1985, and the antitrust laws. Both damages and equitable relief were requested. On January 3 and 24, 1983, the District Court, moving with commendable promptness, held an evidentiary hearing on plaintiff's motion for preliminary injunction. The main question of fact contested at the hearing was what promises had been made Dr. Bell to persuade him to come to South Dakota to practice medicine. He contended, and evidence was presented to support the contention, that a representative of the county--not a member of the Board of County Commissioners, but a person orally authorized by the Board--had promised him in 1969 that he could use the clinic as his office for the practice of medicine indefinitely, as long as he continued to practice in Webster and maintained his good standing as a licensed physician. The defendants argued, among other things, that even if such an oral promise was made, it was legally unenforceable for at least two reasons: not being in writing, nor having been authorized in writing, it was invalid under the statute of frauds; and it was inconsistent with the only written lease that Dr. Bell and the county had ever signed, a one-year lease that expired by its own terms on December 31, 1972. (At one time plaintiff claimed that this lease had been automatically renewing itself from year to year, but he has now announced his intention to abandon this contention. Brief for Appellee 18.) Thus, so far as the law of property is concerned, the positions of the parties come down to this: defendants say Dr. Bell was a tenant from month to month under an oral agreement, which they have terminated, and plaintiff says he has a right, under another oral agreement, to remain in the clinic as long as he practices medicine in Webster.
4
At the conclusion of the hearing the District Court ruled from the bench and granted plaintiff's motion for preliminary injunction. The court made appropriate findings on the balance of equities and held that plaintiff had shown the requisite likelihood of success on his claim that the county had deprived him, or was about to deprive him, of a "property or liberty interest," Tr. 259, without due process of law. On the same day, January 24, 1983, a written order was entered restraining the defendants "from interfering ... with plaintiff's use and possession of his present medical office in the Clinic in Webster, South Dakota." Designated Record (D.R.) 75. The order was to remain in effect until final judgment in the federal suit, and provided that until that time Dr. Bell would pay his rent into a special bank account. The effect of the order, of course, was to prohibit defendants from prosecuting their state-court action for possession of the disputed premises, and no further action in that case has taken place. The District Court also denied defendants' motion to dismiss the complaint, which it had earlier properly agreed, Tr. 48, to treat as a motion for summary judgment. Defendants appeal, claiming that the motion for preliminary injunction should have been denied, and that their motion for summary judgment should have been granted.
5
In the course of its oral opinion, the District Court, following up on a suggestion it had made to counsel earlier, also ruled that it had and would exercise "pendent jurisdiction in the State claim." Tr. 267. By this the court seems to have meant that it would try, in the federal forum, not only the plaintiff's suit under 42 U.S.C. § 1983 and the other federal statutes pleaded, but also the defendants' forcible-entry-and-detainer proceeding, originally filed in the state court. Counsel for plaintiff asked if the court's order would "provide that the Court is accepting pendent jurisdiction and ordering the State Court files to be delivered to the Federal Court," Tr. 266, and the District Court replied:
6
I am reluctant to order the State Court to do anything. I rely on the State Court to do what is right, and I have now ordered that this entire action be tried in this Court, jury demanded, I granted that.
7
Ibid. No written order signed by the District Court was ever entered embodying this apparent decision to exercise "pendent jurisdiction" over the state-court action. Defendants, in addition to their appeal already described, have also petitioned us for a writ of prohibition to command the District Court not to exercise any such "pendent jurisdiction."
II.
8
The preliminary injunction rests entirely on the premise that defendants are depriving plaintiff of either liberty or property without due process of law, or, at any rate, that plaintiff is likely at trial to succeed on his claim that they are doing so. Normally our review of orders granting or denying a preliminary injunction is limited to determining whether the District Court has abused its discretion. That is not true, however, where the question presented is purely one of law. "[O]n questions of law we owe no deference in any formal sense to the District Court." Chu Drua Cha v. Noot, 696 F.2d 594, 599-600 (8th Cir.1982) (vacating denial of preliminary injunction). If the District Court's order granting preliminary relief rests on a legal basis that we believe to be mistaken, then we may and should reverse, whatever the relative equities of the parties may be. For in that event whatever injury the plaintiff may suffer, irreparable or not, will simply be the result of the application of a correct rule of law. Here, we are firmly convinced as a matter of law that defendants have deprived Dr. Bell of neither liberty or property, as those terms are used in the Fourteenth Amendment. This being so, the whole basis of a Section 1983 action on a procedural-due-process theory fails.
9
The plaintiff argues that he should have been given notice and some kind of hearing before the Board met and voted to terminate his occupancy of the clinic. The Board's vote, however, deprived him of no property. It merely expressed the Board's intention to go to court to try to get Dr. Bell out of the clinic. Plaintiff is still in the clinic, and has been continuously ever since the Board's meeting. His hospital staff privileges have not been disturbed, nor has anyone indicated that any effort will be made to disturb them. He argues that the very decision by the Board to sue him for possession should have been preceded by notice and hearing, but we disagree for at least two reasons. First, a rule requiring notice and hearing before any public body decides to go to court to assert its rights in property would paralyze local government in an important part of its responsibilities. And second, whether plaintiff has a property interest in the first place is the question to be decided by the state court in the Board's suit. He has no property right not to be sued for possession. Like any other party to a lease, he is liable to suit by another party seeking a determination of its rights under the lease. At common law, a landlord could enter and expel by force a tenant holding over wrongfully, see Lindsey v. Normet, 405 U.S. 56, 71, 92 S.Ct. 862, 873, 31 L.Ed.2d 36 (1972), and a public body taking such action would perhaps be bound to give the tenant notice and hearing beforehand. But that is not this case. Here, the Board has simply sought the aid of the courts in establishing a property right that, if its view of the law is correct, it has always had.
10
If Dr. Bell were, as a result of the state-court proceedings, about to be evicted without due process, he might have a case. But he does not claim that the South Dakota forcible-entry-and-detainer procedure itself violates the Due Process Clause. Nor could such a claim succeed, in light of Lindsey v. Normet, supra, in which the Supreme Court upheld, against due-process and equal-protection challenges, most features1 of an Oregon statute that was procedurally less generous to tenants than the South Dakota scheme. In South Dakota, the procedure in actions for forcible entry and detainer is in most respects the same as in other actions. S.D. Codified Laws Ann. § 21-16-6 (1979). A jury may be demanded. There are provisions for a quick trial, but a tenant may secure a continuance (as in Oregon) by posting a bond for the payment of rent and costs of suit, id. § 21-16-7. In Oregon defenses such as unconstitutionality of the proceeding, failure of consideration, and unclean hands could not be raised, see 405 U.S. at 66-67 n. 12, 92 S.Ct. at 870-871 n. 12, but in South Dakota equitable defenses such as estoppel and waiver may be asserted. Jordan v. Duprel, 303 N.W.2d 796, 799 (S.D.1981); Heiser v. Rodway, 247 N.W.2d 65, 68 (S.D.1976) ("evidence pertinent to the issue of possession is properly admissible in an unlawful detainer action, even though the evidence is equitable in nature.") (footnote omitted). The apparently contrary holding in Aegerter v. Hayes, 55 S.D. 337, 342, 226 N.W. 345, 347 (1929), was disapproved in Heiser.
11
The major defense raised by Dr. Bell in his answer in the state court, Brief of Appellants App. 1-4, is that he is entitled to possession of the clinic under the alleged oral agreement made in 1969. This defense immediately concerns the right of possession, and we have no doubt that it is properly raised in the state court, along with any related theories of estoppel, as, for example, that even if the oral agreement is void for some reason, the plaintiff's long performance under it should estop the county to attack it. Plaintiff has not pleaded in the state court any federal defenses, but we have no reason to doubt that they would be entertained, assuming they related to his right of possession. Indeed, the state courts would probably be constitutionally compelled to hear and decide any federal defenses. See Testa v. Katt, 330 U.S. 386, 67 S.Ct. 810, 91 L.Ed. 967 (1947), reaffirmed in Federal Energy Regulatory Commission v. Mississippi, 456 U.S. 742, 760-63, 102 S.Ct. 2126, 2137-40, 72 L.Ed.2d 532 (1982). In short, defendants have not deprived plaintiff of his property, and if he loses possession of the clinic in the future, it will only be in accordance with the judgment of a state court, in a proceeding fully consistent with due process, that he has no right to remain.
12
So much for property. Plaintiff also claims that he was deprived of liberty because the Board's vote to go to court to evict him damaged his reputation in the community and reduced his clientele. There is a line of public-employee cases holding that a public body may not discharge anyone--even an employee without a contractual or property right in his job--and make public reasons for the discharge involving stigma or obloquy, without giving the employee a right to clear his or her name at some kind of a due-process hearing. We assume arguendo that the same reasoning could be made to apply to a termination of a lease. The liberty theory still must fail, because defendants never made public any stigmatizing reasons for their action. They simply voted to sue Dr. Bell for possession. No reasons at all were given in public. The accusation that Dr. Bell was responsible for "turmoil" came in a letter written to him at his own lawyer's request. The letter is now public because plaintiff introduced it as an exhibit (PX 2) at the hearing on his motion for a preliminary injunction. Bishop v. Wood, 426 U.S. 341, 347-50, 96 S.Ct. 2074, 2078-80, 48 L.Ed.2d 684 (1976), holds that there is no deprivation of constitutionally protected liberty in such a situation. Accord, Kyles v. Eastern Nebraska Human Services Agency, 632 F.2d 57, 61-62 (8th Cir.1980).
13
It would still be possible to affirm the preliminary injunction if plaintiff had a viable equal-protection theory, assuming the other requirements for interim relief were met, and the parties have briefed this issue, though equal protection does not seem to have been part of the District Court's rationale. But only a moment's reflection is needed to convince us that this is not an equal-protection case. There is no claim that plaintiff is the victim of racial or other class-based animus, nor that he is being evicted because of some irrational classification adopted by the Board. He vigorously insists that the Board was mistaken, perhaps even motivated by personal dislike; that there was no "turmoil" at the clinic, or that in any event he is no more responsible for it than anyone else. He may be right; but that is not at all the same thing as a denial of the equal protection of the laws. The Supreme Court has warned that "[t]he Due Process Clause of the Fourteenth Amendment is not a guarantee against incorrect or ill-advised ... decisions," Bishop v. Wood, supra, 426 U.S. at 350, 96 S.Ct. at 2080, and the same is true of the Equal Protection Clause.
14
The suggestion that "substantive due process" has been violated may be equally briefly disposed of. The argument is, if we understand it, that plaintiff has a constitutional right, no matter what procedures are employed, to occupy the county-owned clinic. We reject this contention. " 'A doctor has no constitutional right to practice medicine in a public hospital,' " Klinge v. Lutheran Charities Association, 523 F.2d 56, 61 (8th Cir.1975) (quoting Woodbury v. McKinnon, 447 F.2d 839, 842 (5th Cir.1971)), and it must follow a fortiori that he has no such right, independent of state property law, to use and occupy public property. It remains true, of course, that a citizen may not be deprived of employment, occupancy of land, or any other significant interest for a constitutionally impermissible reason, like race or religion, but that is not plaintiff's claim here.2
15
For these reasons, we hold that plaintiff has not made out a viable claim under 42 U.S.C. § 1983. He has no likelihood of success on the merits of the § 1983 claims so far pleaded. The preliminary injunction must therefore be reversed.
II.
16
Defendants also appeal from the District Court's denial of their motion for summary judgment. They argue that they are immune from suit because they acted in good faith as that term has recently been redefined by the Supreme Court in Harlow v. Fitzgerald, --- U.S. ----, 102 S.Ct. 2727, 2738, 73 L.Ed.2d 396 (1982):
17
We therefore hold that government officials performing discretionary functions generally are shielded from liability for civil damages insofar as their conduct does not violate clearly established statutory or constitutional rights of which a reasonable person would have known.
18
We have recently held, in Evans v. Dillahunty, 711 F.2d 828 (8th Cir.1983), "that motions for summary judgment and motions to dismiss that are premised on absolute or qualified immunity are immediately appealable [if] ... [t]he essential facts are not in dispute ... and ... the determination of whether the government official is entitled to immunity is solely a question of law." At 830 (footnote omitted).
19
We need not decide whether the District Court's order in this case meets these criteria for appealability, because the immunity issue is, at least for the present, not a live one. In Part I of this opinion we have considered each of the bases for § 1983 relief thus far pleaded by the plaintiff and held that they are untenable. On the present state of the record, therefore, defendants would be entitled to dismissal of the § 1983 claims pleaded in the complaint, quite apart from any defense of good-faith or qualified immunity. If, on remand, plaintiff does move for leave to amend his complaint to assert a § 1983 claim based on a First Amendment theory, if this motion for leave to amend is granted, if the new theory thus pleaded is held to state a claim for relief, if defendants again move to dismiss on the basis of good-faith immunity, and if this motion is denied, then a new appeal could be taken of which we might have jurisdiction. For the present, however, discussion of the immunity issue, either as to jurisdiction or as to its merits, would be pointless. To the extent that defendants now seek to raise this question on appeal, therefore, their appeal will be dismissed as moot. (There remain in the complaint, of course, theories based on 42 U.S.C. § 19853 and the antitrust laws, but we do not understand defendants to be asserting the immunity defense to these theories.)
III.
20
We now turn to No. 83-1235, in which Day County as petitioner seeks a writ of prohibition commanding the District Court not to exercise "pendent jurisdiction" over the forcible-entry-and-detainer action pending in the state court. Extraordinary writs are granted only sparingly, and never simply because of disagreement with a district court on a question of law. We are persuaded, however, that this case falls squarely within the narrowest concept of the writ of prohibition: that is, it represents an apparent decision by a district court to exercise jurisdiction that it clearly does not have, in a situation where the wrongful exercise of jurisdiction cannot be effectively corrected by appeal after final judgment. See In re South Dakota, 692 F.2d 1158, 1161 (8th Cir.1982):
21
If the lower court is clearly without jurisdiction the writ will ordinarily be granted to one who at the outset objected to the jurisdiction, has preserved his rights by appropriate procedure and has no other remedy.
22
(Quoting Ex parte Chicago, Rock Island & Pacific Railway, 255 U.S. 273, 275, 41 S.Ct. 288, 289, 65 L.Ed. 631 (1921).)
23
In theory, we suppose it is possible to argue that any error committed could be corrected on defendants' appeal from a final judgment against them, assuming that such a judgment occurs. We disagree with this position for several reasons. First, defendants will not necessarily lose on the merits. If plaintiffs lose, they could appeal, but would presumably not contest the District Court's exercise of "pendent jurisdiction," since they themselves urged that jurisdiction upon the District Court. In that event, the jurisdiction of the state courts over a case properly brought before them would have been usurped, and no remedy would be available. Even if defendants do lose on the merits, we think their right to try their state-law action in the state courts is so fundamental, and so clearly outside the jurisdiction of the federal courts, that they should not be compelled to go through a federal trial. An appeal from an adverse judgment, even a successful appeal, would not undo the fact that defendants had been unlawfully compelled to try their case in a federal forum.
24
Counsel for Dr. Bell, in his capacity of respondent in the prohibition case, argues that the writ should never be granted unless the entitlement to it is clear, and that, since no case has held that pendent jurisdiction may not be exercised in a situation like that presented here, it cannot be said that there was a clear excess of jurisdiction on the part of the District Court. We disagree. No case has ever held that jurisdiction may not be exercised in this situation simply because no court has ever asserted such jurisdiction, probably because, for reasons we will shortly explain, such an assertion is clearly unauthorized.
25
The Supreme Court has most recently explained the doctrine of pendent jurisdiction in United Mine Workers of America v. Gibbs, 383 U.S. 715, 724, 86 S.Ct. 1130, 1137, 16 L.Ed.2d 218 (1966):
26
[I]f, considered without regard to their federal or state character, a plaintiff's claims are such that he would ordinarily be expected to try them all in one judicial proceeding, then, assuming substantiality of the federal issues, there is power in federal courts to hear the whole.
27
(Footnote omitted.) The whole premise of this doctrine is that two claims have been tendered for decision by some party, either a plaintiff, a counterclaimant, a third-party claimant, or some other party in a similar position. If, for example, the plaintiff here, in addition to his federal claims, had pleaded in his federal-court complaint that his eviction would violate state law, either common or statutory, the federal court would in all likelihood have pendent jurisdiction of that state-law claim, despite the absence of complete diversity among the parties. The situation here is quite different. Plaintiff is asserting a federal claim in a federal court, but the other claim, the one over which the District Court seems to intend to exercise "pendent jurisdiction," is not in the federal court at all, nor is it a claim belonging to the plaintiff. It is, instead, a claim being asserted in a state court by the federal-court defendants. Such a claim, one originally brought in a state court, can get into a federal trial court only by removal, and removal requires the filing of a petition by the state-court defendant, as well as the meeting of statutory grounds, neither of which conditions has or can occur here. What the District Court seems to have done here amounts to a kind of involuntary removal, and there is simply no authority in the statutes for such a procedure. The district courts, like this Court, are courts of limited jurisdiction, and they may not exercise power not conferred upon them by Congress. We must be especially alert to maintain these limits when to transgress them would encroach upon the well-recognized and traditional power and duty of the state courts to decide state-law claims properly brought before them.
28
It is true, as the District Court remarked in its oral opinion, that the federal case and the state case both arise out of a common nucleus of operative fact. That alone, however, is an insufficient basis to justify the assertion of federal jurisdiction over a separate lawsuit brought in a state court. The terms "federal claim" and "state claim" as they are used in the pendent-jurisdiction context refer to the law that creates or governs the respective claims as a substantive matter. They do not refer to the forum in which the claims are pending. In other words, in order for the question of pendent jurisdiction even to arise, there must be before the federal court a claim arising under or governed by federal law and a claim arising under or governed by state law, over which the federal court has no independent basis of jurisdiction. Wrist-Rocket Manufacturing Co. v. Saunders Archery Co., 578 F.2d 727 (8th Cir.1978), cited by the District Court in its opinion, is such a case. There, the plaintiff asserted a federal claim under the Lanham Act and a pendent state claim for breach of fiduciary duty, and we held that the District Court had jurisdiction to hear the state-law claim as well as the Lanham Act claim.
29
The District Court was understandably concerned about the possible duplication of effort and expense that would occur if the two lawsuits, Dr. Bell's federal case and the County's state case, were allowed to proceed at the same time. We share this concern, but there are a number of answers to it. First, the District Court's grant of preliminary injunctive relief, which we have reversed for other reasons, necessarily meant that the state-court case would not go forward, because defendants were forbidden to prosecute it. Second, the simultaneous prosecution of in personam actions in federal and state courts is simply one of the costs that we pay for a federal system. The leading case is Kline v. Burke Construction Co., 260 U.S. 226, 230, 43 S.Ct. 79, 81, 67 L.Ed. 226 (1922), in which the Court held that when two in personam actions, although based on the same claim, are pending, one in a federal court and one in a state court,
30
[e]ach court is free to proceed in its own way and in its own time, without reference to the proceedings in the other court. Whenever a judgment is rendered in one of the courts and pleaded in the other, the effect of that judgment is to be determined by the application of the principles of res adjudicata by the court in which the action is still pending in the orderly exercise of its jurisdiction, as it would determine any other question of fact or law arising in the progress of the case. The rule, therefore, has become generally established that where the action first brought is in personam and seeks only a personal judgment, another action for the same cause in another jurisdiction is not precluded.
31
One of the courts may choose, in the exercise of its own discretion, to stay the proceedings before it, or one of the courts may choose, if the law and the facts justify such action, to enjoin the parties from prosecuting their suit before the other forum. But if neither of these events occurs, the cases may proceed in parallel, and whichever one comes first to judgment becomes res judicata as to the other. For this reason, to take the present case as an example, the District Court's concern for duplication may have been overstated, because, even if the state proceeding had been permitted to go forward (as it now will be because of our reversal of the preliminary injunction), the question of entitlement to possession of the clinic would not have to be litigated twice. Whichever court decides it first would, assuming all of the other requirements of res judicata are met, conclude the other.
32
We hold, therefore, that the petition for writ of prohibition is well taken. We nevertheless believe it unnecessary to direct the clerk actually to issue the writ. For one thing, we are not certain that the District Court really intended to draw unto itself the state-court action as such. In the course of its oral opinion, the Court correctly noted that the taking of pendent jurisdiction was not necessary, because the issue of the right to possession of the clinic would, for reasons we have just now explained, be determined at trial, whether or not the state-court case remained pending in the state forum. In fact, it seems likely that the District Court, for just this reason, may later have thought better of its orally announced intention to assume pendent jurisdiction. The parties apparently submitted to the Court an order embodying this decision in writing, but no such order was ever signed and filed with the clerk. We are not certain, in other words, that the District Court intended to follow through on its oral remarks, and, in any case, we are confident that formal issuance of the writ will not be necessary.
IV.
33
In No. 83-1168, the order granting plaintiff's motion for preliminary injunction is reversed. The defendants' appeal from the denial of their motion for summary judgment is dismissed as moot, and the cause is remanded for further proceedings in accordance with this opinion, looking towards resolution of plaintiff's claims based on 42 U.S.C. § 1985 and the federal antitrust statutes, as well as any amended § 1983 theory he may assert based on the First Amendment. In No. 83-1235, the petition for writ of prohibition is granted, but the clerk will withhold issuance of the writ, subject to the right of petitioner to apply for relief later in the event (which we do not now foresee) of its being necessary.
34
It is so ordered.
1
One feature of the Oregon statute, requiring the posting of a double bond as a prerequisite to a tenant's appeal, was held violative of equal protection, 405 U.S. at 74-79, 92 S.Ct. at 874-877, but the South Dakota statutes contain no such provision
2
Plaintiff intends to ask leave to amend his complaint to assert a First Amendment theory--that he is being ejected because he is "too demanding." Brief of Appellee 18-19. We express no view on the merits of such a theory, and our action today is without prejudice to plaintiff's right to advance it
3
In view of our discussion of the Equal Protection Clause in Part I of this opinion, it is hard to see how a § 1985 claim could succeed. The only portion of that section that appears even arguably applicable in this case is § 1985(3), which requires that some racial or other class-based animus be alleged, a requirement that, as we have seen, is not met here. It is possible, however, that the § 1985 claim, along with the antitrust claim, may be further developed in discovery or by amendment to the pleadings, and our disposition of this appeal is without prejudice to such further development
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518 S.E.2d 186 (1999)
238 Ga. App. 174
CONDRA
v.
The STATE.
No. A99A0134.
Court of Appeals of Georgia.
May 20, 1999.
*187 Charles G. Wright, Jr., for appellant.
Herbert E. Franklin, Jr., District Attorney, Christopher A. Arnt, Assistant District Attorney, for appellee.
POPE, Presiding Judge.
Walter J. Condra appeals from his convictions for child molestation and aggravated sexual battery involving his four-year-old niece. We affirm.
1. Condra contends the trial court erred in allowing similar transaction testimony regarding sexual contact between Condra and his sister because it was hearsay. When Condra's sister took the stand, she first refused to testify regarding sexual activity with Condra, stating, "No comment" in response to the prosecutor's questions. However, upon further questioning, she denied telling the police investigator that Condra had talked her into performing oral sex when she was 11 years old. She also said that Condra had never fondled her breasts or vagina and that he had never had sexual intercourse with her. Condra's counsel declined any cross-examination of the sister.
The trial court then allowed the police investigator to testify as to the sister's prior statement, in which she said that Condra had "pursued" her into performing oral sex on him when she was around 11 and he was 13. The court also allowed Condra's half-brother to testify that the sister had admitted to him that she and Condra had engaged in vaginal intercourse.
We find that this testimony was correctly admitted as a prior inconsistent statement by the sister. "[A] prior inconsistent statement of a witness who takes the stand and is subject to cross-examination is admissible as substantive evidence, and is not limited in value only to impeachment purposes." Gibbons v. State, 248 Ga. 858, 862, 286 S.E.2d 717 (1982). While Condra's sister refused to answer most of the prosecutor's questions, she did deny having certain forms of sexual contact with Condra. The testimony regarding the sister's prior statements directly contradicted her denials on the stand and thus was admissible as a prior inconsistent statement. See id.; Kapua v. State, 228 Ga.App. 193, 195(1), 491 S.E.2d 387 (1997); Foster v. State, 216 Ga.App. 26, 28(2), 453 S.E.2d 482 (1994).
2. Condra also asserts that the sexual incidents involving his sister were not similar *188 to the crime with which he was charged because they were too remote in time, because he was a juvenile when the incidents occurred, and because the incidents were different from the acts with which he was charged.
We will not disturb a trial court's determination that similar transaction evidence is admissible absent an abuse of discretion. Livery v. State, 233 Ga.App. 332, 334(1)(a), 503 S.E.2d 914 (1998).
In crimes involving sexual offenses, evidence of similar previous transactions is admissible to show the lustful disposition of the defendant and to corroborate the victim's testimony. There need only be evidence that the defendant was the perpetrator of both crimes and sufficient similarity or connection between the independent crime and the offenses charged.
(Citation and punctuation omitted.) Gibbins v. State, 229 Ga.App. 896, 899(4), 495 S.E.2d 46 (1997).
The evidence showed the incident of oral sex between Condra and his sister occurred some 21 years prior to trial, and at least 20 years before the incidents with Condra's niece. There was no evidence of the date of the acts of sexual intercourse, so Condra contends that such acts also could have occurred while both he and his sister were children and thus were too remote in time.
The rules regarding the use of similar transaction evidence are construed most liberally in cases involving sexual offenses. The lapse of time between the charged offense and the similar transaction must be considered when deciding whether to admit evidence of independent crimes; however, particularly in cases involving the sexual exploitation of young family members over generations, the remoteness in time is not wholly determinative, but goes to weight and credibility.
(Citations omitted.) Nichols v. State, 221 Ga.App. 600, 601-602(3), 473 S.E.2d 491 (1996). In such cases, this Court has allowed evidence of incidents occurring as much as 29 years earlier. See Gibbins v. State, 229 Ga. App. at 899(4), 495 S.E.2d 46; Nichols v. State, 221 Ga.App. at 602, 473 S.E.2d 491; Snow v. State, 213 Ga.App. 571, 572(2), 445 S.E.2d 353 (1994); Starnes v. State, 205 Ga. App. 882, 883(1), 424 S.E.2d 4 (1992). Here the evidence showed numerous incidents of sexual molestation by Condra involving young family members over that 21-year time span.[1] Under these circumstances, we find the evidence relating to his sister was not too remote to be admissible.
Neither does the fact that Condra was a juvenile affect the admissibility of this evidence. We have held that a "defendant's youth at the time of the similar transaction should be considered when deciding if the testimony should be admitted to show lustful disposition and inclination, i.e., bent of mind." Stephens v. State, 205 Ga.App. 403, 404(1), 422 S.E.2d 275 (1992). In the instance of oral sex, the evidence showed that Condra "pursued" his sister until she consented to perform oral sex upon him. Given defendant's age and his persistence, his request for oral sex was "not the faultless act of an innocent child," but rather demonstrates evidence of his bent of mind. Id.; Gilham v. State, 232 Ga.App. 237, 239(1), 501 S.E.2d 586 (1998). The same can be said for repeated acts of sexual intercourse with his sister.
Condra also notes that because the state did not provide a date when the incidents of sexual intercourse with his sister occurred, they could be acts of consensual sex between two adults and thus unrelated to the acts for which he was tried. As previously noted, the rules regarding the admissibility of prior acts are most liberally extended in the area of sexual offenses, particularly those involving children. Fields v. State, 233 Ga. App. 609, 610(1), 504 S.E.2d 777 (1998). The evidence regarding Condra's sexual intercourse with his sister was admissible to show his bent of mind and lustful disposition with regard to his younger family members. See Phagan v. State, 268 Ga. 272, 279(4), 486 *189 S.E.2d 876 (1997). Cf. Miller v. State, 219 Ga.App. 213, 217(3), 464 S.E.2d 621 (1995).
Accordingly, we find no abuse of discretion by the trial court in allowing the admission of the evidence regarding Condra's sister.
3. Condra also argues that it was error to allow testimony regarding his sexual contact with his half-brother. The half-brother testified that Condra had molested him and engaged in forcible sodomy with him on several occasions when he was six to eight years old. At the time of these incidents, Condra was in his early to mid-20's and married. Condra argues that this evidence should not have been admitted as a similar transaction because it was too remote in time, occurring seven to nine years before the incidents involving his niece, and because the incidents, which involved the anal penetration of a male child, were not sufficiently similar to the charge that he touched his niece's vagina, with no allegations of penetration.
For the reasons noted above, we find that these incidents were not too remote in time to be admissible. Moreover, "[t]he sexual abuse of young children, regardless of the sex of the victims or the nomenclature or type of acts perpetrated upon them, is of sufficient similarity to make the evidence admissible." Willett v. State, 223 Ga.App. 866, 872(3)(a), 479 S.E.2d 132 (1996). Although the incidents here involved children of different sexes, they were substantially similar in that they all occurred at the home where Condra was staying and involved a much younger family member. See Swift v. State, 229 Ga.App. 772, 775(2)(d), 495 S.E.2d 109 (1997); McCormick v. State, 228 Ga.App. 467, 468(3), 491 S.E.2d 903 (1997); Hall v. State, 204 Ga.App. 469, 470-471(1), 419 S.E.2d 503 (1992).
We find, therefore, that the trial court properly admitted evidence of Condra's sexual relations with his half-brother.
Judgment affirmed.
SMITH and ELDRIDGE, JJ., concur.
NOTES
[1] It is logical to assume that the acts of sexual intercourse would have occurred at some point after Condra pursued his sister for oral sex. But even if they occurred before, they would have occurred within the time frame allowed in similar cases as the sister was only 11 years old at the time of the incident of oral sex.
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IN THE MISSOURI COURT OF APPEALS
WESTERN DISTRICT
STATE OF MISSOURI, )
)
Respondent, )
) WD76448
v. )
) OPINION FILED:
) August 19, 2014
ROBERT E. WHEELER, )
)
Appellant. )
Appeal from the Circuit Court of Caldwell County, Missouri
The Honorable R. Brent Elliott, Judge
Before Special Division: Mark D. Pfeiffer, Presiding Judge,
Gary D. Witt, Judge, and Zel M. Fischer, Special Judge
Robert E. Wheeler (“Wheeler”) appeals the judgment of the Circuit Court of Caldwell
County, Missouri (“trial court”), sentencing him as a persistent offender under section 577.023,1
after a jury found him guilty of driving while intoxicated (“DWI”), § 577.010. Wheeler argues
in his point relied on that the trial court erred in sentencing him as a persistent DWI offender.
We affirm.
1
“The version of the statute effective on the date of the DWI offense is the applicable statute.” State v.
Collins, 328 S.W.3d 705, 706 n.1 (Mo. banc 2011). Wheeler was arrested on June 8, 2012. Therefore, all statutory
citations are to the Revised Statutes of Missouri 2000, as updated through the 2011 Cumulative Supplement.
Factual and Procedural Background
Wheeler does not challenge the sufficiency of the evidence to prove that he was guilty of
DWI. Nor does he claim that he was not properly charged as a persistent DWI offender. Rather,
he challenges whether the trial court actually found him to be a persistent DWI offender and the
sufficiency of the evidence to prove his persistent DWI offender status. Therefore, only the facts
dispositive to the issue on appeal will be discussed.
On June 8, 2012, Wheeler was arrested for DWI. Subsequently, the State charged him
with DWI as a persistent offender, an enhanced class D felony, under sections 577.010 and
577.023. The State alleged that Wheeler “had pleaded guilty to, been found guilty of, or was
convicted of driving while intoxicated” in the State of Florida: on April 29, 2009, for events
occurring on or about February 16, 2009; and on October 30, 1990, for events occurring on or
about April 30, 1990.
At a hearing on the morning of trial, prior to the seating of the venire panel, the State
offered into evidence without objection Exhibits 8 and 9,2 as evidence of prior DWIs for the
purpose of enhancing the crime to a D felony,3 and Exhibit 10, as evidence of a prior felony for
sentencing purposes:
[Prosecutor]: We have the prior DWIs that enhance it to a D felony.
2
The first page of State‟s Exhibit 9 is an Exemplification Certification. The certification, signed by a judge
of the Circuit Court of the Fifteenth Judicial Circuit, in and for Palm Beach County, Florida, recites, among other
things, that the court clerk‟s certification and attestation are “in due form” and “full faith and credit are due and
ought to be given to all of the official acts of said Clerk, as well in courts of judicature as elsewhere.” Beneath the
judge‟s certification is the certification signed by the clerk. Attached to the Exemplification Certification are
documents reflecting driving under the influence of alcohol convictions on April 29, 2009, and October 30, 1990,
for offenses that occurred on February 16, 2009, and April 30, 1990, respectively.
3
The procedure for determining persistent DWI offender status in section 577.023.7 is identical to the
procedure for finding a defendant‟s prior and persistent felony offender status in section 558.021.1. Treviño v. State,
206 S.W.3d 356, 359 (Mo. App. S.D. 2006). Because the language of the two statutes is “virtually identical,”
appellate courts have applied section 558.021 case law to section 577.023 cases. Id. at 359-60 (quoting State v.
Sparks, 916 S.W.2d 234, 238 (Mo. App. E.D. 1995)).
2
The Court: Okay. All right. Does the defense have any objection to the
introduction of those exhibits?
[Defense Counsel]: No, Your Honor.
The Court: All right. And those were 8, 9, and 10?
[Prosecutor]: Yes, Judge.
The Court: All right. State‟s Exhibits 8, 9, and 10 are admitted into evidence.
(Emphasis added.) The following colloquy between defense counsel, the prosecutor, and the
trial court then took place:
The Court: And I take it, then, the defense is stipulating he is a prior offender
for purposes of judge sentencing?
[Defense Counsel]: Yes, Your Honor.
The Court: Okay. And it would be to a Class D felony; is that correct?
[Prosecutor]: That‟s correct.
The Court: And what‟s the range of punishment on that, Counsel?
[Prosecutor]: It is one to four years in the Missouri Department of Corrections4
or up to one year in the county jail.
The Court: Okay. All right. And I believe there could be a fine associated
with that. Is that your understanding, Mr. Wheeler?
Mr. Wheeler: Yes, sir.
The Court: Okay. You‟ve been through all that with your attorney?
Mr. Wheeler: Yes.
The Court: Okay. All right.
4
As Wheeler‟s point on appeal suggests, if the trial court was only considering one prior DWI offense for
sentencing purposes, the maximum sentence would have been one year in jail. Yet, this colloquy reflects
admissions to facts and a corresponding understanding by all parties that the trial court would have a maximum
sentencing range of up to four years in the Department of Corrections if Wheeler was convicted of the present
offense.
3
(Emphasis added.) The trial court then inquired of Wheeler whether the two prior convictions
submitted by the State were accurate:
The Court: And you‟re satisfied that this—these convictions they’ve
submitted are accurate?
....
In other words, that you were the individual referred to therein?
Mr. Wheeler: Yes, sir.
(Emphasis added.)
After a jury trial, Wheeler was found guilty of DWI. The trial court sentenced him as a
persistent DWI offender to four years imprisonment, stating in the judgment: “Court pronounces
sentence as follows: DWI Class D Felony Sentence 4 years MDOC.” Wheeler‟s motion for new
trial, which was overruled by the trial court, asserted that the trial court erred in finding that he
was a persistent DWI offender.5 Wheeler appeals.
Standard of Review
“„It is the State‟s burden to prove prior intoxication-related traffic offenses beyond a
reasonable doubt.‟” State v. Lemons, 351 S.W.3d 27, 30 (Mo. App. S.D. 2011) (quoting State v.
Craig, 287 S.W.3d 676, 681 (Mo. banc 2009)); § 577.023.7(2). On appeal, we determine
whether substantial evidence was adduced to support the trial court‟s finding. Id. (citing State v.
Pike, 162 S.W.3d 464, 469 n.4 (Mo. banc 2005)). “„In determining whether there is sufficient
evidence to support the conviction, this court accepts as true all evidence tending to prove guilt
5
Wheeler did not, however, argue that the trial court‟s persistent offender finding was untimely or
procedurally deficient in any other fashion. Thus, Wheeler‟s attempt to inject the issue of timeliness of the trial
court‟s persistent offender status finding for the first time on appeal in the argument section of his appellate brief is,
itself, untimely and improperly asserts an issue not preserved for appeal. See Rule 29.11(d) (“In jury-tried cases,
allegations of error to be preserved for appellate review must be included in a motion for new trial . . . .”).
4
together with all reasonable inferences that support the finding.‟” Id. (quoting Craig, 287
S.W.3d at 681).
Analysis
In his sole point on appeal, Wheeler argues that the trial court erred in sentencing him as
a persistent DWI offender,
in that the trial court did not find that [Wheeler] was a persistent DWI offender,
and State‟s Exhibit No. 9 does not show on its face a valid judgment of guilt or a
plea of guilty for an intoxication-related traffic offense, so [Wheeler] was
sentenced in excess of the maximum sentence authorized by law when he was
sentenced to four years in prison because the most he could have received without
a second prior intoxication-related offense was one year in jail.
A persistent DWI offender, is “[a] person who has pleaded guilty to or has been found
guilty of two or more intoxication-related traffic offenses[.]” § 577.023.1(5)(a). An
“intoxication-related traffic offense” includes “driving while intoxicated . . . or driving under the
influence of alcohol or drugs.” § 577.023.1(4). Any person who pleads guilty to or is found
guilty of driving while intoxicated, § 577.010, who is alleged and proved to be a persistent
offender is guilty of a class D felony. § 577.023.3. The maximum authorized term of
imprisonment for a persistent offender charged with a class D felony is four years.
§ 558.011.1(4).
As to that which is necessary to support persistent offender status sentencing by the trial
court,
The law is well settled that to sentence under [section] 577.023, the trial court is
not required to make express findings of fact supporting a finding that the
defendant is a prior or persistent offender, State v. Boyd, 927 S.W.2d 385, 390
(Mo. App. [W.D.] 1996), or make an express finding that the defendant is such an
offender, where the court effectively finds the defendant to be a prior or persistent
offender, State v. Sparks, 916 S.W.2d 234, 238 (Mo. App. [E.D.] 1995).
5
State v. Gibson, 122 S.W.3d 121, 125 (Mo. App. W.D. 2003). “Where sufficient evidence is
adduced to support the finding that a defendant is a persistent offender, the lack of a specific
finding to that effect by the trial court is „only a procedural deficiency.‟” State v. Rose, 169
S.W.3d 132, 136 (Mo. App. E.D. 2005) (quoting Sparks, 916 S.W.2d at 238 and Boyd, 927
S.W.2d at 390). “The court may use a variety of methods used by trial courts to find prior and
persistent offender status.” Treviño v. State, 206 S.W.3d 356, 360-61 (Mo. App. S.D. 2006)
(citing Gibson, 122 S.W.3d at 125 (concluding that appellant was found to be a persistent
offender and was sentenced accordingly by the trial court when the amended information
charged appellant with DWI as a persistent offender and his sentence of imprisonment of five
years was reserved for persistent DWI offenders); State v. Coomer, 976 S.W.2d 605, 606 (Mo.
App. E.D. 1998) (holding that defendant‟s admission of previous DWI convictions coupled with
the court checking the appropriate boxes on the sentence and judgment form amounted to a
sufficient finding by the court of the defendant‟s prior and persistent offender status); Sparks,
916 S.W.2d at 238 (holding that because the trial court found defendant guilty of a class D
felony DWI, which is reserved for persistent offenders only, the trial court, in effect, found the
defendant to be a persistent offender)).
Here, Wheeler was charged as a persistent offender, class D felony, and upon his DWI
conviction by the jury, was sentenced to four years imprisonment for committing a class D
felony, an enhanced sentence reserved for persistent offenders. Thus, the trial court effectively
found that Wheeler was a persistent offender and sentenced him accordingly, as it was
authorized to do.
As to Wheeler‟s suggestion that no substantial evidence supported such a persistent
offender status finding by the trial court, Wheeler ignores his admission to facts supporting such
6
a finding. “The defendant may waive proof of the facts alleged.” § 577.023.11. The record
clearly reflects that Wheeler admitted at the pre-trial persistent offender status hearing that the
prior convictions submitted by the State were accurate and that he was the person referred to
therein. Wheeler‟s admission “relieve[d] the State of the burden of proving all of the matters
that ordinarily would be necessary to establish the prior conviction.” State v. Johnson, 837
S.W.2d 39, 41 (Mo. App. W.D. 1992). “A judicial admission basically waives or dispenses with
the production of evidence and concedes for the purpose of the litigation that a certain
proposition is true . . . and is conclusive on the party making it.” Id. (internal quotation omitted).
In this case, Wheeler made a judicial admission of his prior intoxication-related convictions and
thereby waived his right to object to the trial court‟s consideration of such convictions. Id.
Furthermore, when the State offered Exhibit No. 9 into evidence for the purpose of
enhancement and again after Wheeler admitted that the convictions were accurate, defense
counsel affirmatively stated that she had no objections to the admission of Exhibit No. 9.
“[O]bjections to the sufficiency of proof in connection with prior offenses may be waived by the
admissions of a defendant or his attorney.” State v. Schnelle, 398 S.W.3d 37, 47 (Mo. App.
W.D. 2013) (quoting Johnson, 837 S.W.2d at 41). And, though Wheeler‟s counsel challenges
the content of Exhibit No. 9 as proving beyond a reasonable doubt that Wheeler was convicted of
one of the two prior DWI offenses, this challenge to the evidence is in the context of Wheeler
previously admitting to the trial court that he was the individual referenced in Exhibit No. 9 that
was the subject of two—not one—prior DWI convictions.6
6
Finally, even were we to ignore Wheeler‟s admissions as to the substance of Exhibit 9, the information
contained in Exhibit 9 plainly references that Wheeler was convicted in the Palm Beach County Court of DUI on
April 29, 2009, for an offense that occurred on February 16, 2009; and with respect to the 1990 conviction of which
Wheeler complains, Exhibit 9 contained information reflecting that Wheeler was charged with DUI in the Palm
Beach County Court under Florida criminal code section 316.193(3)(A), Wheeler pled nolo contendere, and he was
found guilty on October 30, 1990, for an offense that occurred on April 30, 1990. “Our Supreme Court recently
found that a driving record that „plainly listed […] prior convictions‟ established defendant pleaded guilty to or was
7
Wheeler‟s claim of error is without merit and his point relied on is denied.
Conclusion
The trial court‟s judgment is affirmed.
Mark D. Pfeiffer, Presiding Judge
Gary D. Witt, Judge, and Zel M. Fischer, Special Judge, concur.
found guilty of those offenses.” State v. Lemons, 351 S.W.3d 27, 31 (Mo. App. S.D. 2011) (quoting State v. Collins,
328 S.W.3d 705, 708 n.4. (Mo. banc 2011)). In Lemons, the court talked about the sort of “minimal information”
that was necessary to prove the prior offense and focused upon an identification of the court in which the prior
conviction occurred. Id. Here, apart from identifying the court in which the 1990 conviction occurred, the certified
driver record also cited the specific criminal code section that Wheeler was charged under, the date Wheeler was
alleged to have committed the 1990 DUI offense with which he was charged, Wheeler‟s plea to the criminal charge,
and the date upon which Wheeler was found guilty. The information from Exhibit 9 certainly qualifies as more than
“minimal information” about both the 2009 and 1990 DUI convictions; it constitutes a “plain listing” of Wheeler‟s
prior convictions, and the evidence within Exhibit 9 was in addition to Wheeler‟s admissions regarding the two
previous DWI convictions. Wheeler attempts to cast doubt on the specificity of information provided by Exhibit 9
but improperly ignores our standard of review in doing so. Plainly and simply, Exhibit 9 constituted substantial
evidence of Wheeler‟s two previous convictions for a DWI offense.
8
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786 S.W.2d 891 (1990)
Scott Conrad THOMPSON, Personal Representative of the Estate of W.C. Thompson, Deceased, Plaintiff-Appellant,
v.
Glen B. THOMPSON, et al., Defendants-Respondents.
No. 16256.
Missouri Court of Appeals, Southern District, Division Two.
March 12, 1990.
Motion for Rehearing or Transfer Denied April 2, 1990.
Mark J. Pelts, Pelts, Stokley & Turnbow, Kennett, for plaintiff-appellant.
Daniel T. Moore, Poplar Bluff, for defendants-respondents.
HOGAN, Judge.
This action was brought by W.C. Thompson, now deceased, against Glen B. Thompson and Dona Thompson, his wife, to establish a resulting trust in six parcels of realty located in Dunklin County, Missouri. Plaintiff also sought an accounting for the rents and profits derived from the realty during the calendar years 1985 and 1986. Plaintiff W.C. Thompson died during the pendency of the action. Scott Conrad Thompson, personal representative of the Estate of W.C. Thompson, deceased, and W.C. Thompson's sole heir, was substituted as plaintiff. No findings of fact or conclusions of law were requested. The trial court volunteered no findings but did conclude that the plaintiff had failed to carry his burden of proof. Judgment was entered for the defendants and against plaintiff on both counts of the petition. The plaintiff has appealed. With some reluctance, we have concluded the appeal is so inadequately briefed as to require affirmance of the judgment without adjudication on the merits.
It may be gathered from the record that beginning in 1969 and for a number of *892 years thereafter, Glen B. Thompson and his wife Dona purchased and traded several tracts of land in Dunklin County. One may speculate that W.C. Thompson and Glen Thompson enjoyed a close personal relationship and that W.C. Thompson, referred to as "Connie," sometimes gave his brother business advice. Otherwise, the record and the exhibits warrant a number of different reasonable conclusions.
Rule 84.04 (formerly Rule 83.05 and before that Rule 1.08) provides that the brief for the appellant shall contain: (1) a concise statement of the grounds on which jurisdiction of the review court is involved; (2) a statement of the facts; (3) the points relied upon, and (4) an argument which shall substantially follow the order of "Points Relied On." Present Rule 84.04(c) provides that:
"The statement of facts shall be a fair and concise statement of the facts relevant to the questions presented for ... argument."
Long ago, our Supreme Court held that the purpose of the statement of facts was "to afford an immediate, accurate, complete and unbiased understanding of the facts of the case...." Wipfler v. Basler, 250 S.W.2d 982, 984-85 (Mo.1952). This ruling has been restated many times. See Commerce Bank of Kansas City v. Conrad, 560 S.W.2d 388, 390[4] (Mo.App.1977), appeal dismissed, 436 U.S. 901, 98 S.Ct. 2228, 56 L.Ed.2d 399, (1978), reh. denied, 437 U.S. 912, 98 S.Ct. 3106, 57 L.Ed.2d 1143; Dors v. Wulff, 522 S.W.2d 325, 326[2] (Mo.App.1975); Geiler v. Boyer, 483 S.W.2d 773, 774[1, 2] (Mo.App.1972).
A good many years ago, Judge Roscoe P. Conkling, then Chief Justice of our Supreme Court, commented upon the importance of the statement of facts in an address to the Missouri Bar. Speaking of the Statement of Facts, Judge Conkling said:
"It is substantially impossible to place too much emphasis upon the statement of facts in the brief. The facts of the case give rise to the law which must be declared and usually determine the decision of the court for or against the client. No lawyer can afford to fail to master the facts. And accuracy in fact statement is imperative...."
R. Conkling, The Appellate Court Brief Should:, 10 J.Mo.Bar 161, 164 (1954).
While our courts have been hesitant to dismiss an appeal on the ground that the appellant's statement of facts is inadequate, it has held time and again that violation of Rule 84.04(c) constitutes grounds for doing so. See, e.g., Claspill v. City of Springfield, 598 S.W.2d 183, 185[1] (Mo. App.1980); Robinson v. Laclede Gas Co., 553 S.W.2d 495, 496[1, 2] (Mo.App.1977). Of course, perfection is not required, only reasonable compliance. Nevertheless, it is not the duty of an appellate court to become an advocate for the appellant and search the record for error; the judgment rendered is presumptively correct and the appellant has the burden to demonstrate that it is erroneous. Massman Construction Co. v. Kansas City, 487 S.W.2d 470, 478[6] (Mo.1972); Pallardy v. Link's Landing, Inc., 536 S.W.2d 512, 515 (Mo.App. 1976). If the court is to adjudicate the appeal without becoming an advocate for the appellant, the appellant must define the scope of the controversy by stating the relevant facts fairly and concisely. Power v. Automobile Club Inter-Insurance Exchange, 516 S.W.2d 541, 542[1] (Mo.App. 1974).
Failure to comply with Rule 84.04(c), as one might suppose, is more serious in some cases than in others. This case, however, presents a factual dispute. Plaintiff sought to prove the existence of a purchase-money resulting trust in six separate tracts of land. His sole point on appeal is that his evidence established a resulting trust as a matter of law. Nevertheless, plaintiff has contented himself with stating the relevant facts in 20 typewritten lines. His modest expansion of the fact statement in the "argument" part of the brief is inadequate to cure the deficiency in his statement of facts. Considered as a whole, the brief filed is little more than an invitation *893 to examine the record for error. We decline, and affirm the judgment.
FLANIGAN, P.J., and MAUS, J., concur.
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340 F.Supp.2d 291 (2004)
Raymond WRAY, Plaintiff,
v.
CITY OF NEW YORK, New York City Police Department, Daniel Martorano, Police Officer, William Weller, Police Officer, James McCavera, Police Officer, and Police Officers "John Does" including supervisors, in their Individual and Official Capacities, Defendants.
No. 01-CV-04837.
United States District Court, E.D. New York.
October 18, 2004.
*295 Dawn M. Cardi & Associates by Dawn M. Cardi, Esq., Robert Rosenthal, Esq. by Robert Rosenthal, Esq., New York City, for Plaintiff.
Corporation Counsel of the City of New York by Liora Jacobi, Esq., New York City, for Defendants.
MEMORANDUM, ORDER and JUDGMENT
WEINSTEIN, Senior District Judge.
TABLE OF CONTENTS
I. Introduction 295
II. Facts and Procedural History 296
III. Law 301
A. Summary Judgment Standard 301
B. Police Officers 301
1. Individual Capacity 301
a. False Arrest and False Imprisonment 301
b. Use of Suggestive Showup 302
c. Malicious Prosecution 302
d. Failure to Intercede 302
2. Official Capacity 303
C. New York City Police Department 303
D. City's Failure to Train 303
1. Police Officers 304
2. District Attorneys 304
E. Notice of Claim under New York City General Municipal Law 305
IV. Application of Law to Facts 305
A. Police Officers 305
1. Individual Capacity 305
a. False Arrest and False Imprisonment 305
b. Use of Suggestive Showup 306
c. Malicious Prosecution 306
d. Failure to Intercede 306
2. Official Capacity 306
B. New York City Police Department 307
C. City's Failure to Train 307
1. Police Officers 307
2. District Attorneys 307
D. Notice of Claim under New York City General Municipal Law 307
V. Interlocutory Appeal 308
VI. Conclusion 308
I. Introduction
Plaintiff Raymond Wrayfound to have been improperly convicted in state court for an armed robbery and then "exonerated" states an arguably viable section 1983 claim against police officer William Weller for conducting an improperly suggestive showup at a police precinct lockup *296 and against the City of New York for failure to train the police on proper identification procedures. Remaining claims against police officers and the City are dismissed. Wray's argument that the City is responsible for failing to train district attorneys not to use illegally obtained evidence cannot be countenanced; in the criminal courts district attorneys are independent of municipal control.
In setting aside Wray's conviction, the Court of Appeals for the Second Circuit as did the Appellate Division on a direct appeal and the federal district court on a habeas petitionfound the showup by the police at the station house unconstitutionally suggestive. Unlike these other courts, however, the Court of Appeals found the police investigation so flawed and proof of guilt so inadequate as to require setting aside the conviction because of use of evidence of the showup at trial.
Wray sought federal habeas corpus relief after his convictions for robbery and weapons offenses were upheld on direct appeal. He alleged that he was denied due process when the state trial court improperly permitted the use of testimony regarding a witness's out of court showup identification at a precinct lockup. His petition was dismissed by this court. The Court of Appeals for the Second Circuit reversed. It concluded that the admission of the showup evidence was not harmless error. The Queens District Attorney declined to retry Wray. State court charges were then dismissed.
Wray sues the City of New York under section 1983 of title 42 of the United States Code, asserting pendent jurisdiction over related state law claims. Also named as defendants are the Police Department and police officer Daniel Martorano, police officer William Weller, police sergeant James McCavera and unnamed police officers, in their individual and official capacities. Alleged are federal constitutional and state law violations arising out of Wray's arrest and the use of the showup evidence. Damages and injunctive relief are sought requiring training by the City of police and district attorneys on proper identification procedures.
Defendants move for summary judgment on various grounds. They include the existence of probable cause, qualified immunity and failure to state a claim under section 1983 and state causes of action.
II. Facts and Procedural History
Shortly after midnight on November 25, 1990, officers Martorano, Weller and McCavera were at a stakeout observing the front of a restaurant from a rooftop across the street. Officers Martorano and Weller say they saw Wray, in the company of Dennis Bailey, point a gun at Melvin Mitchell and take Mitchell's jacket. Mitchell was accompanied by his friend Craig Williams. Officers Weller and McCavera promptly left the rooftop to apprehend the robbers while officer Martorano remained on the roof, called for backup and stayed in radio contact with his two team members. Officer Martorano observed Wray and his accomplice, Bailey, walk to the restaurant; Wray handed the gun to Bailey, who remained on the street, and then went into the restaurant. Weller and McCavera arrested Bailey, who was carrying a gun.
As Bailey was being escorted to a marked backup police car, officers Martorano and Weller say they saw Wray come out of the restaurant, observe the arrest and run back in. Officer Weller looked inside the restaurant and spotted Wray standing at the back, looking directly at him. Officer Weller then went into the restaurant with officer McCavera and a uniformed police officer, found the stolen *297 jacket, and arrested Wray, who had no weapon.
The victim, Mitchell, and his friend Williams were not on the scene when the arrests occurred, but Mitchell returned to the scene almost immediately and an officer asked him to go to the police station. Within an hour of the arrests, the victim, Mitchell, and his friend Williams were at the station house.
The evidence as to identification at the police station is ambiguous. According to the police, Mitchell and Williams each separately identified Wray, then in a jail cell, as the gunman. Officer Martorano brought Mitchell to the holding cell, pointed to Wray and asked whether Mitchell recognized the prisoner. Officer Martorano recollected that Mitchell confirmed that Wray was the gunman who had taken his jacket. Mitchell testified both before the grand jury and at Wade hearing that he told the police that Wray was with the gunman, not that he was the gunman. The recollections of officer Martorano and Mitchell also differed on whether Wray was alone or with one other person in the cell.
It is agreed that Williams positively identified Wray, while he was in a cell, as the gunman. There is no indisputable information in the record identifying the police officer who brought Williams to the holding cell to identify Wray, aside from Williams' statement, "I think his name starts with a W. Wellie," which a jury, on the other evidence, might find referred to officer Weller.
After Wray was indicted, he moved to dismiss the indictment. The New York state trial court denied Wray's motion, finding that "the evidence adduced before the Grand Jury was legally sufficient to support the charges in the Indictment," the legal instructions given by the District Attorney to the Grand Jury were proper, and "the Indictment is sufficiently specific." Meanwhile, Bailey pled guilty to criminal possession of a weapon. Bailey stated at his allocution that Wray had handed the gun to him but he did not see or know anything about how Wray got the jacket.
At a Wade hearing the trial judge suppressed any evidence of Mitchell's station house identification of Wray, but found that Mitchell had an independent basis to make an in-court identification. The court ruled that Williams would be allowed to testify to his identification of Wray at the station house; although Williams was unable to recognize Wray at the Wade hearing, he testified that he had seen the robbers around the neighborhood before and after the robbery.
At trial officers Martorano and Weller each identified Wray as the gunman. Neither Williams nor Mitchell recognized. Wray as the gunman. Williams did not even recognize Wray as a robber but testified, at different points, that the person he had seen from a side view at the showup was or "looked like" the gunman. When shown the photographs of Wray taken at the police station, Williams testified that the person in the photographs "kind of looked like the person he had seen at the showup; in the end, he testified that he was uncertain as to whether Wray was the person he had seen at the police station. Mitchell testified that he was certain that Wray was not the gunman but uncertain as to whether Wray was one of the robbers.
Wray testified in his own defense, denying any involvement in the robbery. He testified that he was wearing his hat and coat because it was cold in the restaurant and that almost everyone in the restaurant was wearing overcoats, even those who were dancing. Two witnesses testified on his behalf, the owner of the restaurant and *298 a friend, each of whom in essence conceded that it was possible that Wray had left the restaurant for a time just before and during the robbery. There was also testimony that it was warm in the restaurant and that some or most people were not wearing coats.
Wray was convicted of two counts of first degree robbery, one count of second degree criminal possession of a weapon, and one count of third degree criminal possession of a weapon. His conviction was affirmed by the Appellate Division. It found the station house showup impermissibly suggestive, but not violative of the Constitution because of the strong evidence of guilt. People v. Wray, 225 A.D.2d 718, 640 N.Y.S.2d 122 (2d Dep't 1996).
A federal writ of habeas corpus was then sought. The petition alleged that Wray was denied due process when the state trial court improperly admitted evidence of Williams' out of court police station showup identification. The petition was dismissed because, while the admission of the showup evidence constituted a due process violation, it was harmless in light of the strong evidence of guilt. Wray v. Johnson, No. 96 CV 5139, 1998 WL 426569, at *1 (E.D.N.Y. June 18, 1998).
In reversing, the Court of Appeals for the Second Circuit noted that "a suggestive procedure `does not in itself intrude upon a constitutionally protected interest,'" and examined the totality of the circumstances to assess the fairness of the trial. Wray v. Johnson, 202 F.3d 515, 524-30 (2d Cir.2000). It ruled that the error was not harmless because the court "cannot conclude that the erroneously admitted showup identification evidence was unimportant or that that evidence was not a substantial factor in the jury's finding that the gunman was Wray." Id. at 530. It opined that the police should have done a more thorough investigative job before arresting petitioner. The detailed analysis of the facts by the Court of Appeals for the Second Circuit follows:
In the present case, the issue on which the evidence was wrongly admitted was plainly a crucial one: identification of the defendant as the person who committed the crime. On the surface, the prosecution's case for charging Wray seems strong. Two police officers, Martorano and Weller, actually observed the robbery. Afterwards, Martorano watched the gunman enter Bea's Kitchen; Weller entered Bea's Kitchen, where he saw Wray, the only person wearing a hat and long black coat, and he identified Wray as the gunman. Martorano testified that there was "no doubt in [his] mind" that Wray was the gunman (Tr. 401), and Weller testified that he was "[absolutely" convinced that Wray was the gunman (Tr. 506). However, the officers' professions of absolute certainty are suspect when evaluated in light of the record as a whole.
First, though the officers said the lighting during the robbery was good, it was midnight, they were more than 100 feet away from the site of the robbery, the robbery took only some 20 seconds, and the officers had no binoculars or other vision aids. The principal lighting was from overhead streetlights, the officers were on a roof 15 feet above street level, and the gunman's hat had a brim. As Weller testified, "It was dark out and it was shadows." (Tr. 475.) The officers principally described the gunman's clothing; they could not describe his face except to say that it was darkskinned with a mustache and goatee. Martorano said "that's all I can describe of his face." (Tr. 326.) Although the prosecutor argued in summation that "Weller ... told you that he remembered *299 the face" (Tr. 720), that "Weller looked[ ] right at ... the one pointing the gun" and that "is why Officer Weller is able to remember the face of the person he saw hold the gun" (id.), and that when Weller went into Bea's Kitchen, "[h]e looked for the face of the person that he had seen" (Tr. 721), we see no such testimony in the record. Weller testified that the "sole basis for the arrest of this defendant was because of [Weller's] observation on the roof (Tr. 523), and from the roof he saw nothing of the gunman's face except dark skin and "some type of growth, hair around his chin area" (Tr. 475). When asked whether he could "recall anything [else] about" the gunman's "face[ ]," Weller referred to the darkness and the shadows and stated, "It was a little tough to see[ ] the actual make up of the face." (Tr. 475.) Given the physical circumstances and the officers' acknowledgement of their limited ability to see the gunman's face, the officers' identifications of the gunman as Wray cannot be considered strong.
Further, Weller's selection of Wray inside Bea's Kitchen seems plainly to have been based on the fact that only Wray was found wearing a black hat and long black coat similar to that worn by the gunman. Weller, who had found it tough to see the actual makeup of the gunman's face except for its dark skin and some type of hair growth around the chin, did not indicate that he selected Wray based on his complexion; all of the people the officers found at Bea's were persons of color. Nor did Weller say either that he recognized Wray based on his facial hair, or that Wray was the only person he saw who had facial hair. Rather, Weller said that no one else was wearing a "similar outfit[ ]" that "fit the description." (Tr. 524.)
Surprisingly, however, the officers apparently also could not say that Wray's was the only long black coat at Bea's Kitchen. We say surprisingly because the officers knew that the gunman had seen Bailey being arrested and had immediately "turned and r[u]n back into" Bea's (Tr. 331), and the officers believed he would try to conceal himself: they first looked for the gunman in a back office and then in the dark basement; and upon returning to the main floor, they looked for him next in the "completely black" room (Tr. 491). Yet the officers made no effort to determine whether the gunman had attempted concealment by jettisoning the outer clothing he had worn during the robberyif only to blend into the crowd in which, according to the officers, no one else was wearing an outer coat. The officers apparently did not make even a cursory attempt to determine whether there was any other long black coat on the premises.
The prosecutor argued that after the gunman had "run back into the club" he tried to "get[ ] lost in the ... crowd." (Tr. 724.) The gunman may well have done so, but that hardly seems applicable to Wray: Wray was found standing in a well-lit room, on a raised platform, dressed in a hat and long black coat when no one else in the entire restaurant was dressed that way.
Nor was there any physical evidence to connect Wray with the crime. The prosecution could, of course, have presented an overwhelmingly strong case if Wray's fingerprints had been found on the gun Martorano saw the gunman hand to Bailey, which Weller and McCavera had promptly seized. However, the officers did not ask that the gun be tested for fingerprints. The prosecutor in summation argued that there had been no need to "look[ ] for *300 fingerprints [.] The [officers] saw what happened." (Tr. 721.) Yet the officers conceded they had not had a good view of the gunman's face, and they did not entirely agree on what had happened, for they did not even see the same number of robbery victims. In fact, no two witnesses agreed on the total number of persons present at the robbery: Williams testified that he and Mitchell were confronted by three robbersa total of five persons; Mitchell recalled three robbers but thought his friend Patrick was there with him and Williamsa total of six persons; Martorano saw only Mitchell, Williams, and two robbersa total of four persons; and Weller was absolutely sure there were two robbers and only one victim (Mitchell)a total of three. Thus, Weller did not even see Williams during the robbery:
Q. Who is Craig Williams?
A. He's a friend of Melvin Mitchell.
Q. Was he present at the time [of the robbery]?
A. I did not see him there, no.
. . . . .
Q. So your testimony is that when this robbery occurred and this gun was held at Mr. Mitchell, the only people standing there was [sic] Mr. Mitchell, the person you say is Mr. Wray and another person you say is Mr. Bailey, that's it, three people?
A. Correct.
Q. Not four?
A. Not four.
. . . . .
Q. You are ... convinced there were only three people there total?
A. Yes.
. . . . .
Q. Are you as convinced of that that [sic] you are that Mr. Wray is the same person who had the gun that night? A. Absolutely.
(Tr. 504-06.) (How ironic that the improperly admitted showup identification was made by the person Weller was sure had not been present at the robbery.)
In these circumstances, with (a) Mitchell and Williams testifying unequivocally that Wray was not the gunman, (b) no physical evidence to connect Wray to the crime, (c) the police officers poorly situated to see the gunman's face during the 20-second robbery and unable to describe him other than darkskinned with facial hair, and (d) the officers having arrested Wray, out of 30-100 persons of color, based principally on his wearing garments similar to those that had been worn by the gunmanwhich the gunman could be expected to have shedwe think it indisputable that the evidence that Williams had identified Wray at the police station right after the robbery took on critical significance.
Id. at 526-28.
The Queens District Attorney declined to re-try Wray, who by that time had served almost his full term, approximately eight years. The state trial court then dismissed the indictment and all pending criminal charges on July 24, 2000.
A year later, on July 20, 2001, Wray sued under section 1983 of title 42 of the United States Code and state law. Among other claims, he asserted: false arrest, false imprisonment, use of a suggestive showup at the station house, malicious prosecution, failure to intercede to prevent denial of his rights and failure of the City to train or supervise police officers as well as district attorneys and their staffs.
*301 After commencing this federal action, on July 31, 2001, Wray filed a Notice of Claim with the City of New York for "[f]alse imprisonment, wrongful imprisonment, wrongful conviction and wrongful prosecution, [and] violation of State and Federal Constitutional Rights."
Defendants' summary judgment motion rests on a variety of grounds, including the existence of probable cause for the arrest and prosecution, qualified immunity, failure to state a claim under section 1983, and failure to file a timely claim against the City.
III. Law
A. Summary Judgment Standard
To prevail on a motion for summary judgment, the moving party must show that there is "no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." FED.R.CIV.P. 56(c); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Evidence is evaluated in favor of the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).
B. Police Officers
1. Individual Capacity
"Police officers are immune from liability for money damages in suits brought against them in their individual capacities if `their conduct does not violate clearly established statutory or constitutional rights of which a reasonable person would have known.'" Anthony v. City of New York, 339 F.3d 129, 137 (2d Cir.2003) (citing Harlow v. Fitzgerald, 457 U.S. 800, 818, 102 S.Ct. 2727, 73 L.Ed.2d 396 (1982)). "[E]ven where the plaintiff's federal rights and the scope of the official's permissible conduct are clearly established, the qualified immunity defense protects a government actor if it was `objectively reasonable' for him to believe that his actions were lawful at the time of the challenged act." Id. (citing Lennon v. Miller, 66 F.3d 416, 420 (2d Cir.1995)). A defendant is entitled to summary judgment on qualified immunity grounds when
[N]o reasonable jury, looking at the evidence in the light most favorable to, and drawing all inferences most favorable to, the plaintiff[ ], could conclude that it was objectively reasonable for the defendant[ ] to believe that he was acting in a fashion that did not clearly violate an established federally protected right.
Lennon, 66 F.3d at 420 (quoting Robison v. Via, 821 F.2d 913, 921 (2d Cir.1987) (internal quotations omitted)). Summary judgment for the defendant is appropriate where a trier of fact would find that reasonable officers could disagree about the legality of the defendant's conduct under the circumstances. Id.
a. False Arrest and False Imprisonment
Section 1983 provides a cause of action against any person who, acting under color of state law, deprives another person of any right, privilege or immunity secured by the federal constitution or federal laws. 42 U.S.C. § 1983. A section 1983 claim for false arrest is "substantially the same as a claim for false arrest under New York law." Weyant v. Okst, 101 F.3d 845, 852 (2d Cir.1996). The elements of a state and a federal claim for false imprisonment are also essentially like those for false arrest. Singer v. Fulton County Sheriff, 63 F.3d 110, 118 (2d Cir.1995). To establish a claim for false arrest under section 1983, a plaintiff must show that "`the defendant intentionally confined him without his consent and without justification.'" Escalera v. Lunn, 361 F.3d 737, 743 *302 (2d Cir.2004) (quoting Weyant, 101 F.3d at 852).
The existence of probable cause to arrest the plaintiff constitutes justification and defeats a claim for false arrest. Id. An officer has probable cause to arrest when the arresting officer, at the moment of arrest, has "knowledge or reasonably trustworthy information of facts and circumstances that are sufficient to warrant a person of reasonable caution in the belief that the person to be arrested has committed or is committing a crime." Id. "Even if probable cause to arrest is ultimately found not to have existed, an arresting officer will still be entitled to qualified immunity from a suit for damages if he can establish that there was `arguable probable cause' to arrest." Id. Arguable probable cause exists if either (1) "it was objectively reasonable for the officer to believe that probable cause existed," or (2) "officers of reasonable competence could disagree on whether the probable cause test was met." Id.; see also Ricciuti v. N.Y.C. Transit Auth., 124 F.3d 123, 128 (2d Cir.1997).
b. Use of Suggestive Showup
Suggestive identification procedures are disapproved "because they increase the likelihood of misidentification." Neil v. Biggers, 409 U.S. 188, 198, 93 S.Ct. 375, 34 L.Ed.2d 401 (1972); see also State v. Riley, 70 N.Y.2d 523, 522 N.Y.S.2d 842, 517 N.E.2d 520, 523 (1987) (noting that showup identification is strongly disfavored but permissible under certain circumstances and holding that such identifications of arrested persons held at police stations, absent exigency, is inadmissible as a matter of law). A suggestive identification such as a one-to-one confrontation does not itself constitute a violation of a constitutional right. Biggers, 409 U.S. at 198, 93 S.Ct. 375 ("[T]he admission of evidence of a showup without more does not violate due process"); Wray, 202 F.3d at 524 ("[A] suggestive procedure `does not in itself intrude upon a constitutionally protected interest.'" (quoting Manson v. Brathwaite, 432 U.S. 98, 113 n. 13, 97 S.Ct. 2243, 53 L.Ed.2d 140 (1977))); United States v. Bautista, 23 F.3d 726, 730 (2d Cir.1994) (discussing the requirement that police officers make "immediate reasonable efforts" to confirm a suspect's identity). The due process inquiry with respect to the use at trial of an identification following an impermissibly suggestive police procedure focuses on the fairness of the trial. Wray, 202 F.3d at 524.
c. Malicious Prosecution
To establish a claim for malicious prosecution under section 1983, a plaintiff must show that "(1) the defendant initiated a prosecution against plaintiff, (2) without probable cause to believe the proceeding can succeed, (3) the proceeding was begun with malice and (4) the matter terminated in the plaintiffs favor." Ricciuti, 124 F.3d at 130; see also Cook v. Sheldon, 41 F.3d 73, 79 (2d Cir.1994) ("Though section 1983 provides the federal claim, we borrow the elements of the underlying malicious prosecution tort from state law"). As with claims for false arrest or false imprisonment, the existence of probable cause defeats a claim for malicious prosecution. See Ricciuti, 124 F.3d at 130. "Malice" means " `that the defendant must have commenced the criminal proceeding due to a wrong or improper motive, something other than a desire to see the ends of justice served.'" Lowth v. Town of Cheektowaga, 82 F.3d 563, 573 (2d Cir.1996) (quoting Nardelli v. Stamberg, 44 N.Y.2d 500, 406 N.Y.S.2d 443, 377 N.E.2d 975, 976 (1978)).
d. Failure to Intercede
"A police officer `has an affirmative duty to intercede on the behalf of a *303 citizen whose constitutional rights are being violated in his presence by other officers.'" Ricciuti 124 F.3d at 129. "Failure to intercede to prevent an unlawful arrest can be grounds for section 1983 liability" provided that a plaintiff overcomes the hurdle of qualified immunity. Id.
A police officer cannot be held liable in damages for failure to intercede unless (1) the failure permitted fellow officers to violate "`clearly established statutory or constitutional rights' of which a reasonable person would have known" and (2) the failure to intercede was "under circumstances making it objectively unreasonable for him to believe that his fellow officers' conduct did not violate those rights." Id. "To obtain summary judgment on qualified immunity grounds in connection with a claim of failure to intercede to prevent an illegal arrest, a defendant must show that the only result a fair jury could reach is that reasonably competent police officers, faced with the information available to the non-intervening officer at the time of the arrest, could disagree about the legality of the arrest." Id.
2. Official Capacity
Claims against police officers in their official capacity are analyzed as if the claims were brought against the City of New York. See Shabazz v. Coughlin, 852 F.2d 697, 700 (2d Cir.1988) ("Official capacity suits ... are, in all respects other than name, suits against a government entity.").
C. New York City Police Department
The City of New York, rather than the New York City Police Department, is the proper entity for suit; the Department is a non-suable agency of the City. See NYC CHARTER § 396 ("All actions and proceedings for the recovery of penalties for the violation of any law shall be brought in the name of the city of New York and not in that of any agency, except where otherwise provided by law."); see also Morris v. New York City Police Dep't, No. 98 CIV 6607, 1999 WL 1201732, at *3 (S.D.N.Y. Dec. 14, 1999) (dismissing claims against the New York Police Department because it is an agency of the City), aff'd in part and vacated in part, 59 Fed.Appx. 421, 422-23, 2003 WL 943780, at *2 (2d Cir.2003) (summary order) (directing the district court to permit amendment of the complaint to name the City of New York as a defendant).
D. City's Failure to Train
A municipality can be found liable under section 1983 only where the municipality itself causes the constitutional violation at issue. Monell v. Dep't of Soc. Servs., 436 U.S. 658, 98 S.Ct. 2018, 56 L.Ed.2d 611 (1978). "A municipality cannot be held liable under § 1983 on a respondeat superior theory." Id. at 691, 98 S.Ct. 2018. "To hold a city liable under § 1983 for the unconstitutional actions of its employees, a plaintiff is required to plead and prove three elements: (1) an official policy or custom that (2) causes the plaintiff to be subjected to (3) a denial of a constitutional right." Batista v. Rodriguez, 702 F.2d 393, 397 (2d Cir.1983).
The inadequacy of city employees training may constitute a city policy or custom that is actionable under section 1983 only if the failure amounts to "deliberate indifference" to the rights of those with whom the city employees come into contact. City of Canton v. Harris, 489 U.S. 378, 388, 109 S.Ct. 1197, 103 L.Ed.2d 412 (1989). To establish that a municipality's failure to train or supervise constitutes "deliberate indifference" to the rights of citizens, a plaintiff must show that (1) a policymaker knows that employees will confront a given situation, (2) the situation either presents the employee with "a difficult *304 choice of the sort that training or supervision will make less difficult" or "there is a history of employees mishandling the situation," and (3) "the wrong choice by the city employee will frequently cause the deprivation of a citizen's constitutional rights." Walker v. City of New York, 974 F.2d 293, 297-98 (2d Cir.1992). Failing to train for rare or unforseen events does not show deliberate indifference. Id. at 297.
1. Police Officers
Where, as in this case, there is a police training program regarding identification procedures, the City's liability depends on the adequacy of the training program in relation to the tasks that officers must perform. City of Canton, 489 U.S. at 390, 109 S.Ct. 1197. If the training program is not adequate, then the focus is on "whether such inadequate training can justifiably be said to represent `city policy.'" Id. "That a particular officer may be unsatisfactorily trained will not alone suffice to fasten liability on the city, for the officer's shortcomings may have resulted from factors other than a faulty training program." Id. at 390-91, 109 S.Ct. 1197. "And, plainly, adequately trained officers occasionally make mistakes; the fact that they do says little about the training program or the legal basis for holding the city liable." Id. at 391, 109 S.Ct. 1197.
2. District Attorneys
The Court of Appeals for the Second Circuit distinguishes between a district attorney's prosecutorial and managerial duties in determining whether the district attorney is a municipal policymaker and thus if a municipality can be held liable under section 1983 for the district attorney's actions. "When prosecuting a criminal matter, a district attorney in New York State, acting in a quasi-judicial capacity, represents the State not the county." Baez v. Hennessy, 853 F.2d 73, 77 (2d Cir.1988). No municipal liability may arise from a district attorney's decision to prosecute. See id.; see also Buckley v. Fitzsimmons, 509 U.S. 259, 273, 113 S.Ct. 2606, 125 L.Ed.2d 209 (1993) ("[A]cts undertaken by a prosecutor in preparing for the initiation of judicial proceedings or for trial, and which occur in the course of his role as an advocate for the State, are entitled to the protections of absolute immunity. Those acts must include the professional evaluation of the evidence assembled by the police and appropriate preparation for its presentation at trial or before a grand jury after a decision to seek an indictment has been made."). "Where a district attorney acts as the manager of a district attorney's office, the district attorney acts as a county policymaker." Walker, 974 F.2d at 301.
In Walker, the court held that the City of New York could be held liable under section 1983 for failure to train its assistant district attorneys to turn over exculpatory evidence to the defense and to avoid use of perjured testimony. Id. at 300-01. Walker had been convicted based on police officers' and prosecutors' alleged coverup of exculpatory evidence and perjury, and imprisoned for nineteen years before he won his release by unearthing evidence that critically undermined the state's case against him. Id. at 294. He then brought suit under section 1983 against the City of New York, alleging that the City had failed to adequately train and supervise the assistant district attorneys to not suppress exculpatory evidence and that the City's failure to train constituted deliberate indifference to his constitutional rights, proximately causing his wrongful imprisonment. Id. at 295. Walker's extreme facts are distinguishable *305 from the case at bar where, at most, misjudgments rather than malice is suggested.
As a matter of policy it would be dangerous to charge the City with training district attorneys within the City of New York respecting their use of evidence at trials or their investigative practices. District attorneys are independently elected and must be kept free of municipal interference. One of their chief duties is to prosecute criminal conduct by local officials and to discourage corrupt municipalities.
E. Notice of Claim under New York General Municipal Law
As a condition precedent to the commencement of an action against a municipality or any of its employees, a notice of claim must be filed within ninety days after the claim arises. N.Y. GEN. MUN. L. § 50-e(1)(a). Upon application, the supreme court or the county court in its discretion may extend the time to serve a notice of claim. N.Y. GEN. MUN. L. § 50e(5) & (7). Although the statute provides that "[t]he extension shall not exceed the time limited for the commencement of an action by the claimant against the public corporation," N.Y. GEN. MUN. L. § 50-e(5), the New York Court of Appeals has interpreted the provision to require that an application be made "not more than one year and ninety days after the cause of action accrued, unless the statute has been tolled," Pierson v. City of New York, 56 N.Y.2d 950, 453 N.Y.S.2d 615, 439 N.E.2d 331, 332 (1982). Failure to comply with the notice of claim provision ordinarily requires dismissal. Davidson v. Bronx Mun. Hosp., 64 N.Y.2d 59, 484 N.Y.S.2d 533, 473 N.E.2d 761, 762 (1984).
The notice of claim requirement is not applicable to federal claims under section 1983. See Felder v. Casey, 487 U.S. 131, 138-40, 108 S.Ct. 2302, 101 L.Ed.2d 123 (1988) (expressing agreement with "th[e] near-unanimous conclusion" of the lower federal courts that state notice of claim provisions are inapplicable to section 1983 actions brought in federal courts and holding that such provisions are inapplicable to section 1983 actions brought in state courts); see also, e.g., Day v. Moscow, 955 F.2d 807, 814 (2d Cir.1992) (noting inapplicability of New York notice of claim requirements to section 1983 suits); Ahern v. Neve, 285 F.Supp.2d 317, 321 (E.D.N.Y. 2003) ("While the notice of claims requirement applies to state-based claims, it does not apply to actions brought pursuant to Section 1983."); Mompoint v. City of New York, 299 A.D.2d 527, 751 N.Y.S.2d 38, 39 (2d Dep't 2002) (concluding that failure to file a notice of claim does not require dismissal of federal civil rights claims under section 1983).
IV. Application of Law to Facts
A. Police Officers
1. Individual Capacity
a. False Arrest and False Imprisonment
Wray's claims for false arrest and false imprisonment fail. As of the moment of the arrest, there was at least arguable probable cause for officer Weller and his fellow officers to arrest Wray. It was objectively reasonable for officers on the scene to believe that Wray was one of the robbers that they observed committing a crime and then attempting to escape. Alternatively, reasonably competent officers could at least disagree at to whether observation of the robbery under the circumstances sufficed for a reasonable person to believe that Wray committed the robbery. All the officers are entitled to qualified immunity for the false arrest and false imprisonment claims.
*306 b. Use of Suggestive Showup
Wray arguably states a claim against officer Weller for use of an unconstitutionally impermissive showup, assuming that Weller performed the showup at which Williams identified Wray. He fails to state a claim against any other officer. The showups, by bringing identifying witnesses to view Wray in a jail cell at the station house, violated Wray's clearly established constitutional right not to be subjected to an unconstitutionally suggestive identification. The showup itself resulted in no damage to Wray. It was only the showup plus use in court that resulted in damage. The station house identification by Mitchell that officer Martorano arranged was excluded from the trial and thus resulted in no damage to Wray, whereas the one officer Weller allegedly arranged was admitted at trial.
A question of fact remains as to whether it was objectively reasonable for officer Weller, if he was the one who arranged for Williams to observe Wray in a jail cell, to believe that he acted in a manner that was lawful at the time of the showup. Arguably, he was trying to make sure that he had not arrested the wrong person.
If any damages are found for the showup by officer Weller, they are likely to be nominal because such damage was not caused by the officer acting alone, but with the combined actions of the assistant district attorney and the trial judge, each of whom have immunity for their part in the constitutional violation.
It is unclear whether nominal damages would support the award of attorney's fees. John Caher, Fee Award Rule Under Review by High Court, N.Y.L.J., Oct. 12, 2004, at 1 (discussing question pending before the New York Court of Appeals as to whether "lawyers who win only nominal damages for their clients in fee-generating civil rights cases should generally not be entitled to attorney's fees").
c. Malicious Prosecution
As for the malicious prosecution claim, there was at least arguable probable cause at the time of Wray's arrest. Williams' positive identification of Wray at the showup did nothing to weaken the assessment of whether there was cause for the arrest at the crime scene. Once officer Weller had arrested Williams and turned over the evidence to the assistant district attorney, the officer had no control over what evidence was to be used by the district attorney. The grand jury indicted and the petty jury convicted. Officer Weller is entitled to qualified immunity for the malicious prosecution claim. Although Wray alleges that officer Weller and other police personnel withheld from the district attorney's office information regarding the circumstances of the arrest and the improper showups, there is no evidence to support this claim.
d. Failure to Intercede
Wray fails to state a claim against any police officer for failure to intercede to prevent an unlawful arrest or to prevent the unlawful showups. There was probable cause to arrest Wray and thus Wray's arrest did not constitute a violation of any constitutional right. As for the showups, Wray did not identify which police officers or supervisors, if any, knew of and thus would have had an opportunity to intercede to prevent the showups. Since Wray has been provided with a full opportunity to identify any such officers or supervisors through discovery, these claims are dismissed.
2. Official Capacity
Wray's claims against the defendant police officers in their official capacity are *307 analyzed as if those claims were brought against the City of New York.
B. New York City Police Department
Wray's claims against the New York City Police Department fail because it is an agency of the City of New York and therefore is not a suable entity.
C. City's Failure to Train
1. Police Officers
The claim that the City failed to train and supervise police officers about appropriate identification procedures will probably fail at trial because Wray probably cannot establish "deliberate indifference" to the rights of citizens. The police are given general training regarding identification procedures and the need to prevent mistaken identifications. The circumstances of Wray's arrest were unusual in that the police officers witnessed the crime. It probably cannot be concluded that any policymaker knew or should have known that the police would be confronted with a situation where there is an issue as to whether a showup may be used to confirm the identification made by police officers who witnessed a crime first-hand. Nor has it been shown that there is a possibility of proving a history of police mishandling similar situationsi.e., impermissibly using a showup to confirm firsthand identifications made by police officers.
Nevertheless, in view of the strong statement of the Court of Appeals for the Second Circuit with respect to inadequate police activity, it is possible that the City's liability could be proved at trial. Without that strong statement, the case would be dismissed on the ground that the police had at least arguable probable cause to arrest and confirm their arrest by the police station showup.
2. District Attorneys
The decision of the Court of Appeals for the Second Circuit in Walker (see Part III.C.2., supra) is not applicable to this case. The facts of Walker, involving police coverup and Brady violations, were so egregious that, as already pointed out, it is limited to its facts.
Wray's claim against the City for failure to train assistant district attorneys is more accurately characterized as a challenge to the prosecutorial decision to use the showup evidence. Had the trial court excluded the evidence, the assistant district attorney would not have been able to use it at trial. Once the trial court at the Wade hearing permitted the introduction at trial of the showup evidence, the assistant district attorney could not, as a matter of law, have been forced to refrain from using it. There is no hint of any deliberate misleading of the state court or the state defense counsel by the assistant district attorney, or of any conspiracy between the police and the assistant district attorney.
Wray's claims with respect to the training and supervision of assistant district attorneys fail. Deliberate indifference cannot be established. There is no showing that there is the possibility of proving a history of assistant district attorneys mishandling evidence of a station house showup identification that followed an arrest based on the police witnessing the commission of a crime.
D. Notice of Claim under New York General Municipal Law
The state trial court dismissed Wray's indictment on July 24, 2000 and Wray filed the requisite notice of claim on July 31, 2001over a year after his claim arose. Wray failed to comply with the ninety-day deadline for filing. Nor did he file an application for leave to serve a late *308 notice within the one-year-and-ninety-day period during which a state court would have had the discretion to grant an extension. No basis for tolling exists. As of this date, well over four years since his claim arose, Wray is ineligible for an extension for the notice of claim and thus is barred from maintaining suit on his state law claims. State claims are dismissed. The notice of claim requirement does not, however, affect his claims under section 1983.
V. Interlocutory Appeal
The dubious nature of conclusions denying full dismissal invites reversal. The court is of the opinion that its decision failing to dismiss the civil rights claim under section 1983 of title 42 of the United States Code based on a suggestive station house identification involves a controlling question of law as to which there is substantial ground for a difference of opinion; an immediate appeal from the order may materially advance the ultimate termination of the litigation. See 28 U.S.C. § 1292(b). No stay is granted. Id.
VI. Conclusion
Defendants' motion for summary judgment is granted except for the claim against officer Weller for use of an unconstitutionally suggestive identification and the claim against the City of New York for failure to properly train police personnel with respect to proper identification procedures. No basis for an injunction has been shown. An interlocutory appeal is desirable.
SO ORDERED.
| {
"pile_set_name": "FreeLaw"
} |
Filed 2/8/16 Payne v. American Contractors Indemnity Co. CA3
NOT TO BE PUBLISHED
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
THIRD APPELLATE DISTRICT
(Mono)
----
LARRY PAYNE, C072674
Plaintiff and Appellant, (Super. Ct. No. CV110138)
v.
AMERICAN CONTRACTORS INDEMNITY
COMPANY,
Defendant and Respondent.
Plaintiff Larry Payne doing business as Camouflage Construction (Payne) appeals
from a judgment of dismissal entered after the trial court sustained demurrers without
leave to amend filed by defendant American Contractors Indemnity Company (American
Contractors). Payne, a general contractor, brought this action against American
Contractors stemming from a payment of $10,000 on a surety bond to a homeowner who
claimed that Payne had improperly installed windows in her home that subsequently
leaked. Payne protested American Contractors’s payment on the bond, arguing that he
1
properly installed the windows, and refused to reimburse American Contractors. Payne
alleged that he has been unable to obtain a bond or have his contractor’s license
reinstated as a result of American Contractors’s “activity.”
Payne sued American Contractors for breach of contract, breach of the implied
covenant of good faith and fair dealing, and declaratory relief. American Contractors
demurred to Payne’s original complaint on the ground it failed to state a claim upon
which relief could be granted. The trial court sustained the demurrer to the breach of
contract and breach of the implied covenant of good faith and fair dealing causes of
action with leave to amend, and sustained the demurrer to the declaratory relief cause of
action without leave to amend. Payne’s first amended complaint alleged causes of action
for breach of contract and breach of the implied covenant of good faith and fair dealing.
American Contractors again demurred on the ground the first amended complaint failed
to state a claim upon which relief could be granted, and the trial court sustained the
demurrer in its entirety without leave to amend. Thereafter, a judgment of dismissal was
entered.
Payne appeals, contending the trial court erred in determining that his complaint
and first amended complaint failed to state a claim upon which relief could be granted.
Alternatively, he contends the trial court abused its discretion in sustaining the demurrers
without leave to amend. We shall reverse the order sustaining the demurrer to the
declaratory relief cause of action and the resulting judgment of dismissal. We shall
affirm the order sustaining the demurrer without leave to amend to the breach of contract
and breach of the implied covenant of good faith and fair dealing causes of action.1
1 We deny American Contractors’s request to take judicial notice of “California
Contractors State License Board file for license history of Camouflage Construction,
license number 715317,” filed November 6, 2013, as irrelevant to the resolution of the
issues raised on appeal.
2
FACTUAL BACKGROUND2
Payne is engaged in the business of construction and home repair. He holds a
contractor’s license, which is currently suspended. American Contractors is a licensed
insurance surety that is engaged in the business of providing surety bonds.
In 2003, Payne and American Contractors entered into a written indemnity
agreement, which provides in pertinent part:
“IN CONSIDERATION of the execution of such bond and in
compliance with a promise of the undersigned made prior thereto, the
undersigned individually hereby agree, for themselves, their personal
representatives, successors and assigns, jointly and severally, as follows:
“1. To reimburse [American Contractors] upon demand for all
payments made for and to indemnify [American Contractors] from:
“a) all loss, contingent loss, liability and contingent liability, claim,
expense, including attorneys’ fees, for which [American Contractors] shall
become liable or shall become contingently liable by reason of such
suretyship, whether or not [American Contractors] shall have paid same at
the time of demand.”
On August 27, 2003, following the payment of a $70 premium, American
Contractors issued Payne a contractor’s bond for the term of one year. The indemnity
agreement and bond apparently were renewed in subsequent years.
In June 2007, Susan Bruer made a claim against Payne’s bond alleging that Payne
had improperly installed windows in her home in 2004 that later allowed water to leak
into her home, causing damage. In 2006, prior to making her claim against Payne’s
bond, Bruer hired contractor Paul Linaweaver, who performed work on the windows.
Linaweaver concluded that Payne had improperly removed the existing window frames
2 Because this matter comes to us following a judgment sustaining demurrers without
leave to amend, we assume the truth of the material facts properly pleaded in Payne’s
original and first amended complaints. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318.)
We look to the facts set forth in the original complaint to determine whether Payne
alleged facts sufficient to state a cause of action for declaratory relief, and otherwise look
to the facts alleged in the first amended complaint.
3
when he installed the windows and estimated that it would cost in excess of $30,000 to
correct the problem and repair the resulting damage.
Sometime thereafter, American Contractors inspected the windows and
determined that Payne’s improper installation caused damage to Bruer’s home and
estimated that it would cost in excess of $30,000 to repair. A low-level representative of
the window manufacturer advised American Contractors that the window frames should
not have been removed, and that the new windows should have been installed in the
existing window frames.
After concluding its investigation, American Contractors indicated to Payne that it
was willing to pay Bruer $10,000 to settle her claim. Payne protested, noting that he
followed the installation instructions, which directed that the existing window frames be
removed. On December 19, 2007, American Contractors advised Payne that it would pay
Bruer $10,000, and that it expected Payne to reimburse it for the payment to Bruer and
additional costs totaling at least $11,500. Following payment on the bond, Linaweaver
performed the “alleged repairs” to Bruer’s home for $10,000.
After paying Bruer’s claim, American Contractors refused to issue Payne a new
bond and notified the California Contractor State Licensing Board (Board) about Payne’s
“alleged improper work,” the bond payout, Payne’s refusal to reimburse American
Contractors for the payout, and American Contractors’s refusal to issue Payne a new
bond. When the Board learned that Payne did not have a bond and failed to reimburse
American Contractors, it suspended Payne’s license, instituted an administrative
proceeding against him, and cited him for the alleged improper work. The Board’s action
was upheld at the administrative level. In September 2011, the Board dropped the
“allegations contained in the citation” after Payne filed a petition for a writ of mandamus.
American Contractors continues to threaten Payne with legal action based on the
bond payout and investigation costs associated with the underlying claim. Payne has
4
been unable to obtain a bond from another bond company as a result of American
Contractors’s “activity as described,” and as a result, his license remains suspended.
DISCUSSION
Because this action centers on a surety bond, we begin our discussion with a
review of general suretyship principles. A surety bond is “conceptually and legally
distinct” from other types of insurance. (Washington Internat. Ins. Co. v. Superior Court
(1998) 62 Cal.App.4th 981, 989 (Washington Internat.) “An insurer undertakes to
indemnify another ‘ “against loss, damage, or liability arising from an unknown or
contingent event,” whereas a surety promises to “answer for the debt, default, or
miscarriage of another.” [Citation.]’ [Citation.] The surety relationship is a tripartite
one, in which the third party (the obligee, or, here, the [homeowner]), rather than the
principal (here, [Payne]), is protected by the surety’s promise to pay if the principal does
not, in exchange for which promise the principal pays the premium for the bond.
[Citation.] While an insurer has no right of subrogation against its insured, a surety has
every right to reimbursement from its principal. [Citation.] In other words, under a
surety bond, the principal is not indemnified; the surety can sue the principal for any
sums it must pay out to the obligee . . . .” (Ibid.)
“ ‘In general, a surety bond is interpreted by the same rules as other contracts.
[Citation.] That is, we seek to discover the intent of the parties, primarily by examining
the words the parties have chosen.’ [Citation.] The extent of the surety’s liability must
be gathered from the language used when read in the light of the circumstances
surrounding the transaction. Further, when a bond is given to satisfy a statutory
obligation, the relevant statutory provisions are incorporated into the bond. [Citation.]”
(First National Ins. Co. v. Cam Painting, Inc. (2009) 173 Cal.App.4th 1355, 1365.)
Here, Payne was required by statute to obtain a contractor’s bond for the benefit of any
homeowner contracting for home improvements with him or any person damaged by his
5
violation of the statutory provisions governing his contractor’s license. (Bus. & Prof.
Code, §§ 7071.5 & 7071.10.)
By statute, “[a] surety who has assumed liability for payment or performance is
liable to the creditor immediately upon the default of the principal, and without demand
or notice.” (Civ. Code, § 2807.) The surety’s liability is coextensive with that of the
principal. (Civ. Code, § 2809; Cypress v. New Amsterdam Casualty Co. (1968) 259
Cal.App.2d 219, 225.) Once liability arises, a surety may act to settle the action. (Arntz
Contr. Co. v. St. Paul Fire & Marine Ins. Co. (1996) 47 Cal.App.4th 464, 485 (Arntz
Contracting).) “If a surety satisfies the principal obligation without legal proceedings the
principal is bound to reimburse the surety for what he has disbursed.” (Pacific Indem.
Co. v. Hargreaves (1939) 36 Cal.App.2d 338, 343; accord, Ragghianti v. Sherwin (1961)
196 Cal.App.2d 345, 351 [“a surety may be entitled to reimbursement by his principal
whether or not the surety’s payment on behalf of his principal was compelled by actual
legal proceedings”].) A surety’s right to indemnification is limited to amounts paid in
good faith to satisfy the principal’s obligation. (Arntz Contracting, at p. 482.)
I
The Original Complaint Sufficiently States a Cause of Action for Declaratory Relief
Defendant contends that the trial court erred in sustaining the demurrer to his
declaratory relief cause of action because his original complaint set forth facts showing
the existence of an actual controversy relating to the legal rights and duties of the parties
and requested that the rights and duties of the parties be adjudged by the court. We agree
that the original complaint sufficiently states a cause of action for declaratory relief, and
that the trial court erred in sustaining a demurrer to that cause of action.
In addition to the facts set forth above, Payne’s original complaint alleged the
following with respect to the declaratory relief cause of action: “38. There exists now an
actual and real dispute between Payne and [American Contractors] as to whether
[American Contractors] is entitled to reimbursement in excess of $12,000. [¶] 39.
6
[American Contractors’s] insistence that Payne reimburse [American Contractors]
prevents Payne from reinstating his license which has been suspended for Payne’s failure
to obtain a bond and failure to reimburse [American Contractors]. [¶] 40. Payne seeks a
determination that the work that Payne performed in 2004 is not improper and that Payne
does not have to reimburse [American Contractors] for its decision to pay out on the
bond.”
In its demurrer to the original complaint, American Contractors argued that
Payne’s declaratory relief failed to state facts sufficient to constitute a cause of action
because it “fails to identify an actual controversy between [Payne] and [American
Contractors].” In particular, American Contractors argued that “[t]he requested relief to
determine the work performed by [Payne] in 2004 was proper has nothing to do with a
controversy between [Payne] and [American Contractors].” At the hearing on the
demurrer, the trial court asked Payne why it should “care about whether [Payne] should
be required to pay [American Contractors] for the original payment on the bond?” Payne
responded that until American Contractors either drops its demand for reimbursement or
is “forced to,” he cannot get “bonded,” and without a bond he cannot get his license
reinstated. American Contractors countered that whether Payne is required to reimburse
American Contractors is a “non-issue” since the statute of limitations had run on any
claim by American Contractors to reimbursement under the indemnity agreement. Payne
disagreed, explaining that numerous insurance companies have refused to issue him a
bond because “of owing this money to [American Contractors].” The trial court then
remarked, “[H]e still is claiming that he is not getting bonded because he owes you
money and you are saying he doesn’t owe [you] any money.” American Contractors’s
counsel clarified, “Well, I didn’t say he doesn’t owe us any money,” and explained that
while American Contractors could not collect the debt “because of the statute of
limitations,” it would not issue Payne another bond because it “paid out” and Payne
7
“didn’t pay us back.”3 The trial court sustained the demurrer to the declaratory relief
cause of action without leave to amend, explaining that the issue Payne sought to have
determined was not “pertinent to this . . . lawsuit.”
We decide de novo whether the complaint contains sufficient facts to state a cause
of action. (Bower v. AT&T Mobility, LLC (2011) 196 Cal.App.4th 1545, 1552.) We
assume the truth of all facts properly pleaded, but do not assume the truth of contentions,
deductions or conclusions of law. (Ibid.) We also consider judicially noticed matters.
(Blank v. Kirwan, supra, 39 Cal.3d at p. 318.) “Facts appearing in exhibits attached to
the first amended complaint also are accepted as true and are given precedence, to the
extent they contradict the allegations.” (Paul v. Patton (2015) 235 Cal.App.4th 1088,
1091.) If the trial court sustained the demurrer without leave to amend, the plaintiff has
the burden of proving an amendment would cure the defect. (Id. at p. 1095) If we find
there is a reasonable possibility an amendment could cure the defect, we must reverse the
trial court. (Ibid.)
The existence of an “ ‘actual controversy relating to the legal rights and duties of
the respective parties,’ suffices to maintain an action for declaratory relief. (Code Civ.
Proc., § 1060.)” (Ludgate Ins. Co. v. Lockheed Martin Corp. (2000) 82 Cal.App.4th 592,
605.) Code of Civil Procedure section 1060 is clear: “Any person . . . who desires a
declaration of his or her rights or duties with respect to another . . . may, in cases of
actual controversy relating to the legal rights and duties of the respective parties, bring an
original action or cross-complaint in the superior court . . . . He or she may ask for a
declaration of rights or duties, either alone or with other relief; and the court may make a
3 To date, American Contractors has not brought an action against Payne to recover the
payment to Bruer, and as the parties agreed at the hearing on the demurrer, the four-year
statute of limitations for bringing such an action has run. (Code Civ. Proc., § 337 [four-
year statute of limitations for action upon any contract, obligation, or liability founded
upon a written instrument].)
8
binding declaration of these rights or duties, whether or not further relief is or could be
claimed at the time.” Thus, a complaint for declaratory relief is legally sufficient if it sets
forth facts showing the existence of an actual controversy relating to the legal rights and
duties of the parties and requests that the rights and duties of the parties be adjudged by
the court. If these requirements are met and no basis for declining declaratory relief
appears, the court should declare the rights of the parties whether or not the facts alleged
establish the plaintiff is entitled to favorable declaration. (Ludgate Ins. Co. v. Lockheed
Martin Corp., supra, 82 Cal.App.4th 592, 606, citing Wellenkamp v. Bank of America
(1978) 21 Cal.3d 943, 947.)
Here, Payne’s original complaint sets forth facts showing the existence of an
actual controversy relating to the legal rights and duties of the parties, namely whether
American Contractors is entitled to reimbursement from Payne for the payout to Bruer
and expenses related thereto, and sets forth facts in support of that allegation. Among
other things, Payne alleges that he protested the payout to Bruer on the ground he
properly installed the windows in accordance with the manufacturer’s instructions;
American Contractors sought reimbursement from him for the payout; and American
Contractors’s insistence that he reimburse it has prevented him from obtaining a bond
and having his license reinstated.
That the statute of limitations has run for American Contractors to sue Payne for
reimbursement does not mean there is no longer an actual controversy to resolve as
American Contractors contends. Payne seeks a declaration with respect to his obligation
“to reimburse [American Contractors] for its decision to pay out on the bond”--not
American Contractors’s right to judicially enforce that purported obligation. The running
of the statute of limitations as to the latter does not obviate the controversy as to the
former. (See, e.g., Alborzian v. JPMorgan Chase Bank, N.A. (2015) 235 Cal.App.4th 29,
40.) Indeed, at the hearing on the demurrer, American Contractors’s counsel confirmed
that while American Contractors can no longer sue Payne for reimbursement, it still
9
considers him to be indebted to it for the monies it paid to Bruer and the expenses related
thereto. And it is this purported debt that Payne alleges continues to prevent him from
obtaining another bond and having his license reinstated. Accordingly, the trial court
erred in sustaining the demurrer to this remedy as the cause of action was legally
sufficient.
II
The Trial Court Properly Sustained the Demurrer to the Breach of Contract Cause of
Action Without Leave to Amend
Defendant next contends that the trial court erred in sustaining the demurrer to his
breach of contract cause of action because he sufficiently alleged “the existence of an
agreement, [his] performance under it, the breach of the agreement by [American
Contractors], and damages.” Alternatively, he contends that even if the demurrer was
properly sustained, the trial court abused its discretion in sustaining it without leave to
amend. We disagree with both contentions.
In addition to the facts set forth above, Payne’s first amended complaint alleged in
pertinent part: “32. Payne and [American Contractors] entered into a written contract in
2003 or thereabouts which [American Contractors] would provide a $10,000 surety bond
in return for Payne paying a premium. [¶] 33. [American Contractors] agreed to pay
only those claims which [American Contractors] ‘shall become liable or shall become
contingently liable for by reason of such suretyship.’ ” [¶] 34. Payne has performed all
contractual obligations or has been excused for performing due to [American
Contractors’s] breach of [sic] other reason. [¶] 35. [American Contractors] paid out on a
claim that [American Contractors] was no [sic] liable or contingently liable for by reason
of such suretyship.”
American Contractors demurred to the breach of contract cause of action on the
ground that Payne “provides no facts as to what contractual obligations of the contract
were breached by [American Contractors].” More particularly, it asserted that Payne
10
“appears to contend that [American Contractors] breached the contract because
[American Contractors] was not liable or contingently liable to the homeowner. This
argument is a defense if [American Contractors] was seeking reimbursement from
[Payne] for [American Contractors’s] losses under the Indemnity Agreement. However,
[American Contractors’s] liability or non-liability to the homeowner does not render
[American Contractors] in breach of the indemnity agreement with [Payne].” Payne
opposed the demurrer, noting that he “alleges that the breach is both the improper payout
by [American Contractors] and [American Contractors’s] payment of a bond it was not
legally obligated to pay.”
The trial court sustained the demurrer to the breach of contract cause of action,
reasoning: “[I]f you look at the indemnity agreement, [American Contractors]
performed. There was no obligation in that particular agreement . . . other than to execute
a bond for [Payne] and which [American Contractors] did. [¶] [American Contractors’s]
liability or nonliability to the homeowner doesn’t render [American Contractors] in
breach of the indemnity agreement.” The court further found that American
Contractors’s “demand in a letter for payment is not a breach of their promise to provide
and pay a bond.”
The elements of breach of contract are “(1) the contract, (2) plaintiff’s
performance or excuse for nonperformance, (3) defendant’s breach, and (4) the resulting
damages to plaintiff.” (Careau & Co. v. Sec. Pac. Bus. Credit, Inc. (1990) 222
Cal.App.3d 1371, 1388 (Careau & Co.).)
Contrary to Payne’s allegation in the first amended complaint, American
Contractors did not “agree[] to pay only those claims which [American Contractors]
‘shall become liable or shall become contingently liable for by reason of such
suretyship.’ ” Rather, the parties agreed that Payne would be required to reimburse
American Contractors only for those claims which American Contractors “shall become
liable or shall become contingently liable by reason of such suretyship.” (Paul v. Patton,
11
supra, 235 Cal.App.4th at p. 1091 [facts appearing in exhibits to complaint prevail over
conflicting allegations in complaint itself].) Thus, American Contractors’s payment to
Bruer did not constitute a breach of the indemnity agreement regardless of whether it was
“liable” for the claim.
To the extent Payne contends that American Contractors’s demand for
reimbursement constituted a breach of the indemnity agreement, he is mistaken. The
indemnity agreement obligated American Contractors to execute a contractor’s bond,
which it did. The indemnity agreement obligated Payne to reimburse American
Contractors for claims American Contractors “shall become liable or shall become
contingently liable by reason of such suretyship.” If, as Payne alleges, American
Contractors sought reimbursement for a payment made on a claim that it was not liable or
contingently liable for, such a circumstance would provide Payne with a defense to an
action by American Contractors--not a basis for a breach of contract action against
American Contractors.
Ragghianti v. Sherwin (1961) 196 Cal.App.2d 345 (Ragghianti), cited by Payne,
illustrates this point. Unlike the present case, Ragghianti involved an action by a surety
seeking reimbursement for a payment allegedly made on behalf of the defendant. (Id. at
p. 346.) The defendant moved for summary judgment based on the theory that there was
no right to reimbursement because the payment was voluntary. In affirming the summary
judgment in favor of the defendant, the Court of Appeal noted that under the terms of the
bond and the agreement with the County of Contra Costa, the surety was bound to the
county alone, and its payment in settlement of a contractor’s claim was not made under
any legal compulsion, but as a mere volunteer. (Id. at pp. 350-351.) To the extent Payne
claims that American Contractors’s payment to Bruer was not made under any legal
compulsion, such a claim is properly asserted as a defense in an action by American
Contractors for reimbursement. As set forth above, American Contractors has not
brought an action against Payne to recover the payment to Bruer and is barred from doing
12
so in the future under the applicable statute of limitations. (Ante, fn. 3.) For all the
foregoing reasons, we conclude that Payne’s first amended complaint fails to state a
breach of contract cause of action.
In his reply brief, Payne contends that in the event we determine, as we have, that
the first amended complaint fails to state a breach of contract cause of action, the trial
court abused its discretion in sustaining the demurrer without leave to amend. Payne
proposes an amendment that focuses on American Contractors’s alleged payment of a
claim it was not “legally obligated” to pay. We can discern no material difference
between the allegations in the first amended complaint and Payne’s proposed
amendments thereto. To the extent Payne’s use of the phrase “legally obligated” is
intended to mean “compelled by actual legal proceedings,” we note that “a surety may be
entitled to reimbursement by his principal whether or not the surety’s payment on behalf
of his principal was compelled by actual legal proceedings.” (Ragghianti, supra, 196
Cal.App.2d at p. 351.) Because plaintiff has failed to show that amendment would cure
the defect, the demurrer was properly sustained without leave to amend.
III
The Trial Court Properly Sustained the Demurrer to the Breach of the Implied Covenant
of Good Faith and Fair Dealing Cause of Action Without Leave to Amend
Lastly, Payne contends that the trial court erred in sustaining the demurrer to his
breach of the implied covenant of good faith and fair dealing cause of action because he
“alleges breach of contract and then pleads that all contracts have an implied duty of
good faith and fair dealing,” American Contractors breached that duty, and he was
damaged by its breach. Alternatively, he contends that even if the demurrer was properly
sustained, the trial court abused its discretion in sustaining it without leave to amend. We
disagree with both contentions.
In his first amended complaint, Payne incorporates all prior allegations and then
alleges in pertinent part as follows: “38. All contracts have implied in the agreement a
13
duty of good faith and fair dealing. [¶] 39. [American Contractors] breached the implied
duty of good faith and fair dealing. [¶] 40. Payne has been damaged thereby.”
In its demurrer to the first amended complaint, American Contractors argued that
Payne failed to “identify what actions of [American Contractors] constituted a breach of
the covenant of good faith and fair dealing.” Payne opposed the demurrer, citing to
allegations in the first amended complaint concerning American Contractors’s
investigation of Bruer’s claim. American Contractors responded that “any alleged claim
for improper investigation of the bond claim” is barred by the applicable four-year statute
of limitations. The trial court sustained the demurrer as to the breach of the implied
covenant of good faith and fair dealing cause of action without leave to amend.
On appeal, Payne contends that he adequately pleaded a cause of action for breach
of the implied covenant of good faith and fair dealing by alleging breach of a contract,
again citing to allegations concerning American Contractors’s investigation of Bruer’s
claim. Those allegations read as follows: “17. [American Contractors] alleged to
conduct an inspection of Payne’s work although as indicated work was performed by
Paul Linaweaver on the windows prior to any inspection by [American Contractors]. [¶]
18. [American Contractors] appeared to rely on information provided by Paul
Linaweaver in determining that Payne’s installation of the windows was improper and
damaged Bruer including that the cost of repair would exceed $30,000. [¶] 19.
[American Contractors] also contacted the manufacture[r] of the window whose low level
representative indicated that the window frames should not be removed prior to
installation of the new windows but instead the windows should be installed in the
existing window frames. [¶] 20. [American Contractors] then indicated to Payne a
willingness to pay the sum of $10,000 to Bruer. [¶] 21. Payne protested in many
respects but most significantly pointed to the installation directions of the installed
windows which explicitly called for the removal of the existing window frames in order
to install properly the new windows which Payne followed when he installed the
14
windows. [¶] 22. [American Contractors] discounted Payne’s protests and informed
Payne through Payne’s counsel on December 19, 2007 that [American Contractors]
would pay Bruer $10,000 and that [American Contractors] expected Payne to reimburse
[American Contractors] for the payment to Bruer and additional costs for an amount of at
least $11,500. [¶] 23. Following payment on the bond, Linaweaver performed the
alleged repairs to Bruer for $10,000. [¶] 24. Subsequent to the decision of [American
Contractors] to pay Bruer’s claim, [American Contractors] refused to issue a new bond to
Payne.”
“ ‘The covenant of good faith and fair dealing . . . [is] implied by law in every
contract . . . .’ ” (Durell v. Sharp Healthcare (2010) 183 Cal.App.4th 1350, 1369.) It is
read into contracts and functions “ ‘as a supplement to the express contractual covenants,
to prevent a contracting party from engaging in conduct which (while not technically
transgressing the express covenants) frustrates the other party’s rights to the benefits of
the contract.’ ” (Racine & Laramie, Ltd. v. Department of Parks & Recreation (1992) 11
Cal.App.4th 1026, 1031-1032.) The covenant also requires each party to do everything
the contract presupposes the party will do to accomplish the agreement’s purposes.
(Harm v. Frasher (1960) 181 Cal.App.2d 405, 417.) A breach of the implied covenant of
good faith is a breach of the contract (Careau & Co., supra, 222 Cal.App.3d at p. 1393),
and “breach of a specific provision of the contract is not . . . necessary” to a claim for
breach of the implied covenant of good faith and fair dealing (Carma Developers (Cal.),
Inc. v. Marathon Development California, Inc. (1992) 2 Cal.4th 342, 373).
To prevail on his breach of the implied covenant of good faith and fair dealing
cause of action, Payne must establish that American Contractors acted in bad faith in
evaluating Bruer’s claim or in seeking reimbursement from Payne. (Arntz Contracting,
supra, 47 Cal.App.4th at pp. 483-484.) Bad faith is not the equivalent of evil motive.
Rather, “ ‘the covenant of good faith can be breached for objectively unreasonable
conduct, regardless of the actor’s motive.’ [Citation.]” (Id. at p. 483.) For example,
15
indemnification from the contractor is properly denied where the surety pays expenses
which are “ ‘unnecessary and unwarranted’ ” or “without ‘rational justification.’ ” (Id. at
pp. 483-484.) Good faith does not require omniscience. For example, a surety acts in
good faith when it settles a claim after determining it is liable or contingently liable by
reason of the suretyship, even if the principal/contractor later establishes it was not
technically at fault. (See, e.g., Seaboard Surety Co. v. Dale Const. Co. (1st Cir. 1956)
230 F.2d 625, 630 (Seaboard).)
Here, the first amended complaint is devoid of any allegations that would support
a finding that American Contractors acted in bad faith. Even if Payne could somehow
establish years after the fact that he properly installed the windows, it does not follow that
American Contractors acted in bad faith in settling Bruer’s claim or in seeking
reimbursement from Payne. (See Seaboard, supra, 230 F.2d at p. 630.) In the event
we determine, as we have, that the first amended complaint fails to state a cause of action
for breach of the implied covenant of good faith and fair dealing, Payne asserts that he
could amend the complaint to adequately state such a claim as follows: American
Contractors “promised not to seek reimbursement unless [it] was legally obligated to do
so. [It] did not determine whether [it] was legally obligated to do so prior to paying out a
claim against Payne’s bond. By failing to obtain a determination of whether [it] was
legally obligated to do so or by paying out on a bond claim that [it] was not legally
obligated to do so and by then seeking reimbursement from Payne and so notifying the
Contractors Board, [American Contractors] breached the parties’ agreement.” As
previously discussed in connection with the breach of contract cause of action, American
Contractors made no such “promise.” Rather, pursuant to the indemnity agreement, the
parties agreed that Payne would be required to reimburse American Contractors only for
those claims which American Contractors “shall become liable or shall become
contingently liable by reason of such suretyship.” Moreover, “a surety may be entitled to
reimbursement by his principal whether or not the surety’s payment on behalf of his
16
principal was compelled by actual legal proceedings.” (Ragghianti, supra, 196
Cal.App.2d at p. 351.) Because plaintiff has failed to show that amendment would cure
the defect, the demurrer to the breach of the implied covenant of good faith and fair
dealing cause of action was properly sustained without leave to amend.
DISPOSITION
We reverse the order sustaining American Contractors’s demurrer to the
declaratory relief cause of action without leave to amend and the ensuing dismissal of the
same, and remand for further proceedings consistent with this opinion. The order
sustaining the demurrer to the breach of contract and breach of the implied covenant of
good faith and fair dealing causes of action without leave to amend is affirmed. The
parties shall bear their own costs on appeal. (Cal. Rules of Court, rule 8.278(a)(5).)
/s/
Blease, Acting P. J.
We concur:
/s/
Butz, J.
/s/
Mauro, J.
17
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728 F.2d 1555
1984-1 Trade Cases 65,868
JICARILLA APACHE TRIBE, Plaintiff, Appellant, Cross-Appellee,v.SUPRON ENERGY CORPORATION, Southland Royalty Company, JamesG. Watt, Secretary of the Interior, Gas Company ofNew Mexico, Defendants, Appellees,Cross-Appellants,Exxon Corporation, Defendant, Cross-Claimant, Appellee,Cross-Appellant,State of New Mexico, Applicant in Intervention and Appellantin 81-1680.
Nos. 81-1680, 81-1860, 81-1871 to 81-1874 and 81-1939.
United States Court of Appeals,Tenth Circuit.
Feb. 24, 1984.Rehearing Granted March 30, 1984.
Robert J. Nordhaus and B. Reid Haltom of Nordhaus, Haltom & Taylor, Albuquerque, N.M., for plaintiff, appellant, cross-appellee Jicarilla Apache Tribe.
Bruce D. Black of Campbell, Byrd & Black, P.A., Santa Fe, N.M. (Kemp W. Gorthey, Santa Fe, N.M., with him on the brief), for defendant, appellee, cross-appellant Supron Energy Corp.
Peter J. Adang and Susan Stockstill Julius of Modrall, Sperling, Roehl, Harris & Sisk, P.A., Albuquerque, N.M. (John R. Cooney, Albuquerque, N.M., with them on the brief), for defendant, appellee, cross-appellant Southland Royalty Co.
Christopher Harris, Atty., Dept. of Justice, Washington, D.C. (Carol E. Dinkins, Asst. Atty. Gen., Anthony C. Liotta, Deputy Asst. Atty. Gen., Land and Natural Resources Div., Washington, D.C., William L. Lutz, U.S. Atty., Raymond Hamilton, Asst. U.S. Atty., Albuquerque, N.M., and Edward J. Shawaker, Atty., Dept. of Justice, Washington, D.C., with him on the brief, William R. Murray, Jr., Dept. of the Interior, Washington, D.C., of counsel), for defendant, appellee, cross-appellant James G. Watt, Secretary of the Interior.
Gary R. Kilpatric of Montgomery & Andrews, P.A., Santa Fe, N.M. (Edward F. Mitchell and Mark F. Sheridan, Santa Fe, N.M., with him on the brief), for defendant, appellee, cross-appellant Gas Co. of New Mexico.
J. Douglas Foster of Hinkle, Cox, Eaton, Coffield & Hensley, Roswell, N.M. (Harold L. Hensley, Jr., Roswell, N.M., with him on the brief), for defendant, cross-claimant, appellee, cross-appellant Exxon Corp.
Thomas L. Dunigan, Asst. Atty. Gen., State of N.M., Santa Fe, N.M. (Jeff Bingaman, Atty. Gen., and Bill Primm, Asst. Atty. Gen., Santa Fe, N.M., with him on the brief), for State of N.M., applicant in intervention and appellant in 81-1680.
Kenneth J. Guido, Jr., Reid Peyton Chambers, Harry R. Sachse, Lloyd B. Miller, Kevin A. Griffin and Loftus E. Becker, Jr. of Sonosky, Chambers, Sachse & Guido, Washington, D.C., filed a brief on behalf of amici curiae Shoshone and Arapahoe Indian Tribes.
Before SETH, Chief Judge, McWILLIAMS and SEYMOUR, Circuit Judges.
SETH, Chief Judge.
1
These are consolidated actions and appeals wherein the plaintiff asserts a series of claims arising from oil and gas leases executed 25 or 30 years ago. There are several separate issues raised on appeal concerning computation of royalty, development and antitrust claims. The gas production was from wells located on the Jicarilla Reservation and was sold and consumed in New Mexico.
Issues Relating to Value of Gas
2
The trial court, 479 F.Supp. 536, held for all practical purposes that the defendants should have paid royalty computed on a "value" which was derived from the total net amount realized by the Lybrook processing plant for all products it developed from the gas it received from Southern Union which in turn had been purchased from and at the leases of the defendants on the Jicarilla Indian lands.
3
The court required that there be a "dual accounting" by all lessees which meant that there be determined both the price received by the lessees for wet gas at the wellhead where title passed, but adjusted for btu content; and secondly, that there be ascertained the value of the several products derived from the gas stream, and sold by the Lybrook plant operator/owner. This product figure was to be a net figure or "net realization." The trial court held that the royalty from all leases concerned should be computed on the larger of the two figures. The court thus mandated that the "value" based on plant product values (or net realization) be determined, and be used as an alternate whether or not the lessee paying the royalty had any interest in the processing plant and whether or not the lessee received any added compensation for the products developed by the plant. This blanket requirement was contrary to the position taken by the Secretary through the years. The requirement of "dual accounting" required of all lessees by the trial court is one of the several basic issues raised on this appeal. It has a facet which involves the Secretary of Interior as the trial court also held that this dual accounting should have been required by the Secretary from the outset and since it was not done there was thereby a breach of fiduciary duty.
4
The leases were executed in the early 1950's and the regulations then in effect were not changed since that time in any respect material to this problem up to the time in 1979 when the trial court entered orders directed to dual accounting. From 1950 to 1979 without exception, and without variation, the Secretary and the USGS had construed the lease provisions and the regulations to require dual accounting not by all lessees, but only in instances where the lessee owned the processing plant (or received added money for its products).
5
The trial court's holding was thus contrary to a long uniform administrative construction and application of the regulations and the lease provisions. The trial court did not build on any basis in the administration actions, but instead developed a wholly new interpretation. It made no finding that the Secretary or the USGS had acted through the years with any abuse of discretion or in an arbitrary and capricious manner.
6
The record shows that Supron was the only defendant which at any material time had an interest in the Lybrook plant. This interest was recognized at the time it existed by the USGS in its construction of the lease and regulations. Thus royalty requirements and reports by it were based on product value. This is an example of the consistent application of administrative construction. Since no other defendants had such an interest no such requirement was placed on them until the trial court sought to apply product values to all lessees although the plant was operated/owned by strangers whose operations and costs were not before the court and no reason was advanced as to why they would be made available to the defendants. The plant also processed gas from the general area thus from leases not here concerned. It is located outside of and about 20 miles west of the reservation boundary.
Lease Provisions
7
The lease provision in paragraph 3(c) [in Southland leases] provides that the royalty at 16 2/3% be computed on:
8
"the value or amount of all oil, gas, and/or natural gasoline, and/or all other hydrocarbon substances produced and saved from the land leased herein ...."
9
The lease form [Southland] provides that the Secretary has discretion to ascertain "value" for the computation. Thus paragraph 3(c) provides also that:
10
"During the period of supervision, 'value' for the purposes hereof may, in the discretion of the Secretary, be calculated on the basis of the highest price paid or offered (whether calculated on the basis of short or actual volume) at the time of production for the major portion of the oil of the same gravity, and gas, and/or natural gasoline, and/or all other hydrocarbon substances produced and sold from the field where the leased lands are situated, and the actual volume of the marketable product less the content of foreign substances as determined by the oil and gas supervisor. The actual amount realized by the lessee from the sale of said products may, in the discretion of the Secretary, be deemed mere evidence of or conclusive evidence of such value. When paid in value, such royalties shall be due and payable monthly on the last day of the calendar month following the calendar month in which produced; when royalty on oil produced is paid in kind, such royalty oil shall be delivered in tanks provided by the lessee on the premises where produced ...."
11
It appears that the royalty provisions are directed to production and sale at the field thus "produced and sold from the field." The due date for royalty payments is related to the month "in which produced" thus produced from the ground. When royalty oil is paid in kind it is to be delivered on the "premises."
12
The phrase "[t]he actual amount realized by the lessee from the sale of said products" referred back to oil, gas, natural gasoline, and "all other hydrocarbon substances produced and sold from the field." This portion is clearly limited by the first few words--"[t]he actual amount realized by the lessee." The "actual amount realized" can apply under the Secretary's construction to a lessee who realizes amounts from products sold or from his extraction plant but to those situations only.
13
The lease makes specific reference to the value of products of gas for royalty purposes to allow for the cost of manufacture as one choice with the "value" of gas as the other. Thus
14
"It is understood that in determining the value for royalty purposes of products, such as natural gasoline, that are derived from treatment of gas, a reasonable allowance for the cost of manufacture shall be made, such allowance to be two-thirds of the value of the marketable product unless otherwise determined by the Secretary of the Interior on application of the lessee or on his own initiative, and that royalty will be computed on the value of gas or casinghead gas, or on the products thereof (such as residue gas, natural gasoline, propane, butane, etc.), whichever is the greater."
15
This provision gives the typical gas value versus a rough net "value" of the product. This lease provision refers to the determination of the "value for royalty purposes of products." It thus describes what is to be done if royalty is to be applied to "products," but it does not say under what circumstances royalty shall be computed on products.
16
As described above, the Secretary has construed the lease and the regulations to require a computation based on products only when the lessee is the owner of the plant producing the products or on those who realize direct income from the sale of products.
17
Despite the several sentences following it, the controlling limitation as to royalty is the phrase "the actual amount realized," and the subsequent provisions are directed to such a determination with formulas and choices to accomplish that end.
Regulations
18
The regulations expand on the several lease provisions quoted above and quote portions, thus 30 C.F.R. Sec. 171.13, 30 C.F.R. Sec. 221.47, 30 C.F.R. Secs. 221.51 and 221.52.
19
30 C.F.R. Sec. 221.50 makes reference to products and subsection (b) provides:
20
"If the lessee derives revenue on gas from two or more products, a royalty normally will be collected on all such products."
21
This is specific as to a lessee who "derives revenue" on gas from products will pay a royalty on all such products. Again, the term "derives revenue" points only to a lessee who has a processing plant or a contract to share in the sale of products.
Section 221.50(c) provides:
22
"For the purpose of computing royalty, the value of wet gas shall be either the gross proceeds accruing to the lessee from the sale thereof or the aggregate value determined by the Secretary of all commodities, including residue gas, obtained therefrom, whichever is greater."
23
It appears that the trial court placed its principal reliance on this subparagraph (c) in arriving at an independent judgment as to the proper construction of the lease.
24
We cannot agree with the trial court that this subsection by itself or together with other regulations or lease terms is sufficient to set aside the Secretary's construction of his regulation and lease which was followed and applied without exception for these many years, a construction which has a perfectly reasonable basis in the lease and in the regulations. Furthermore it was and is in conformance with the practices in the industry as shown by the record.
25
We cannot overlook the express provision in the lease which states relative to "value" for royalty:
26
"The actual amount realized by the lessee from the sale of said products may, in the discretion of the Secretary, be deemed mere evidence of or conclusive evidence of such value."
27
The regulations contain similar provisions. These clear grants of authority cannot be ignored in assessing the discretion of the Secretary.
28
We have described and quoted at some length the lease clauses and the pertinent provisions of the regulations. This has been done not to determine whether or not we agree with the administrative interpretation, but instead to describe the issue and to show the basis for the Secretary's position. When the prevailing doctrine in this circuit is then applied to these circumstances we must conclude that the administrative interpretation which prevailed through the years must be applied.
29
We have found no abuse of discretion in this respect by the Secretary and the trial court found none. There is no indication of action by the Secretary which could be characterized as arbitrary or capricious. The Secretary's position is consistent with case law in this circuit. See Barby v. Cabot Corporation, 465 F.2d 11 (10th Cir.1972).
30
The trial court's determination that dual accounting is required of all lessees must be and is set aside. The original construction placed on the lease and regulations by the Secretary as to this issue must be applied to and through the conclusion of these proceedings. The Secretary and the IBLA appear to have changed their positions in response to rulings on the point by the trial court during these proceedings.
Fiduciary Duty of the Secretary
31
As noted above, the trial court held that the Secretary of Interior violated fiduciary standards in not applying the royalty provisions in the way in which the court construed them. In view of our holding above as to the basis for the Secretary's construction, in view of the discretion vested in the Secretary as to the regulation of oil and gas matters, in the absence of any finding or indication of abuse of discretion, and in view of the conformance of the construction to the general practices in the industry and the controlling case law, we find no basis for the trial court's determination as to fiduciary standards. We need not and do not decide whether or not the Secretary owes the tribe a fiduciary duty as to the matters under consideration.
Gas Volumes
32
We have concluded that the trial court was correct in its holding that the volume measurements of gas in the past were correct as was the application of field prices. These points are fully developed in the record and by the trial court and no purpose would be served by a review of the facts in this opinion.
Lease Development
33
The trial court held that there was no proof adduced to demonstrate a lack of development under the leases. This matter was so examined under the legal standards applicable to the circumstances which are well developed. This is a much litigated matter and there are well defined standards. The trial court applied these to the facts and we agree with the conclusion so reached.
34
Since there was no violation of lease terms or regulations as to development of the leaseholds, we do not reach the question as to whether the Secretary had a fiduciary duty as to this matter. The Secretary necessarily functioned within the lease terms and the regulations.
Antitrust Issues
35
In its complaints the plaintiff advanced several antitrust claims based on alleged price-fixing by the defendants. In this position plaintiff's reliance was placed on the most part on the fact that long-term gas purchase contracts had been entered into between the lessees and Southern Union, the gas purchaser. The court found no evidence of price-fixing or restraint of trade. It found that the gas purchase contracts were typical since the 1930's of those used in the San Juan Basin by other purchasers. The court found that the contracts entered into by the lessees although similar in form were the result of independent business judgments and sound business reasons were evident.
36
The trial court laid particular emphasis on the uniform use by Southern Union of most favored nation clauses in its gas purchase contracts throughout the San Juan Basin. We agree that this is a significant factor. The price evidence before the court demonstrates that the prices were generally in accordance with the national trends. The tribe in 1976 sought to sell its royalty gas to Southern Union at the same price.
37
As to the liquids produced at the Lybrook plant the evidence showed that they were but a very small part of the market. Supron produced when it operated the plant no more than a 3% market share. Southern Union also had a relatively small share of the market for liquids in the Basin. Southern Union purchased about 4% of the gas produced in the market area.
38
The extent of the market as determined by the trial court--the San Juan Basin--is a factual matter. The definition of a relevant market is a factual matter, only to be disturbed if the trial court's finding was clearly erroneous. Telex Corp. v. IBM, 510 F.2d 894 (10th Cir.1975). The basis of the determination is the interchangeability of the product controlled with other available products. United States v. Du Pont & Co., 351 U.S. 377, 76 S.Ct. 994, 100 L.Ed. 1264. We must hold that the trial court's finding is correct and supported by the record.
39
There existed some interlocking directors and some corporate affiliations from time to time. There were a series of reorganizations and mergers. The trial court concluded as to section 8 of the Clayton Act there may have been some technical violations. The tribe was, however, unable to show any ill effects flowing from interlocking directorships in some of the defendant companies. In the absence of proof of anticompetitive effects, the tribe could prevail only if interlocking directorships was a per se violation of the Sherman Act. The Supreme Court has shown great reluctance to add to the short list of types of economic activity that are per se Sherman Act violations. White Motor Co. v. United States, 372 U.S. 253, 83 S.Ct. 696, 9 L.Ed.2d 738. A per se violation is a naked restraint of trade with no purpose except to stifle competition. The tribe has not shown that interlocking directorships have this kind of "pernicious effect on competition and lack of any redeeming virtue." Northern Pac. R. Co. v. United States, 356 U.S. 1, at 5, 78 S.Ct. 514, at 518, 2 L.Ed.2d 545. We agree with the trial court that the tribe has not made out a case for damages under section 8 of the Clayton Act. Section 8 forbids interlocking directorships, and there may have been a technical violation of this provision. However, the tribe offers only speculation on possible ill effects of interlocking directorships and no evidence of injury caused by a possible violation. It may be true that such a situation may indicate an opportunity to conspire, but affiliation does not by itself necessarily imply conspiracy to restrain trade. H & B Equipment Co., Inc. v. International Harvester Co., 577 F.2d 239 (5th Cir.1978); Knutson v. Daily Review, Inc., 548 F.2d 795 (9th Cir.1976). We affirm the trial court's holding that the tribe failed to carry its burden of showing injury that is connected in a causal manner to the violation. Gottesman v. General Motors Corporation, 436 F.2d 1205 (2d Cir.1971).
The State Law Ceiling on Gas
40
The trial court held that the New Mexico Natural Gas Pricing Act, Sec. 62-7-1 et seq. N.M.S.A.1978, did not apply to gas produced on the Jicarilla reservation. We must reverse this determination because there are no exceptions to the application of the state statute in its control of ceiling price on intrastate natural gas, and we conclude that the decisions of the Supreme Court demonstrate that the state statute does apply to the gas sales here under consideration.
41
The method for computing royalty is fixed in the lease which created the business relationship between the lessor and lessee, and which also granted the lessee an interest in the land. We have in this opinion described the pricing or value for royalty purposes. It is basically a field price in a large producing area and the ceiling price is fixed by federal and state laws as a price control designed to protect the ultimate gas consumers from excessively high prices. These ceilings necessarily override contractual relationships and there are no exceptions based on who the royalty owner may be. It appears that the State of New Mexico as a royalty owner is subject to the ceilings. It is a limit on the size of the royalty owner's check and the lessee's check.
42
The transaction here concerned is a sale to non-Indians on the reservation. This is the source of income to the tribe from the commercial and land ownership arrangement. The limit is thus on income as in Moe v. Salish & Kootenai Tribes, 425 U.S. 463, 96 S.Ct. 1634, 48 L.Ed.2d 96, and in Washington v. Confederated Tribes of Colville Indian Reservation, 447 U.S. 134, 100 S.Ct. 2069, 65 L.Ed.2d 10. We must hold that the determination of this issue is controlled by the two cited cases.
43
There is by reason of the state price control act an effect on the money the tribe receives from the sales but there is no direct conflict with Indian self-government.
44
The relationship is with non-Indians as mentioned--sales on the reservation to non-Indians. In this respect we must consider the recent opinion of the Supreme Court in Montana v. United States, 450 U.S. 544, 101 S.Ct. 1245, 67 L.Ed.2d 493 and in United States v. Wheeler, 435 U.S. 313, 98 S.Ct. 1079, 55 L.Ed.2d 303. In Montana, the Court quoting from Wheeler said of the tribe's right over the entire reservation:
45
" 'The areas in which such implicit divestiture of sovereignty has been held to have occurred are those involving the relations between an Indian tribe and nonmembers of the tribe ....
46
" 'These limitations rest on the fact that the dependent status of Indian tribes within our territorial jurisdiction is necessarily inconsistent with their freedom independently to determine their external relations. But the powers of self-government, including the power to prescribe and enforce internal criminal laws, are of a different type. They involve only the relations among members of a tribe.' "
47
The Court in Montana also said that the "exercise of tribal power beyond what is necessary to protect tribal self-government or to control internal relations is inconsistent with the dependent status of the tribes, and so cannot survive without express Congressional delegation."
48
The Court in Merrion v. Jicarilla Apache Tribe, 455 U.S. 130, at 138, 102 S.Ct. 894, at 902, 71 L.Ed.2d 21, refers to the sharp distinction between Indian taxing acts and the lease covenants. It there said:
49
"As we observed in [Washington v. Confederated Tribes of the ] Colville [Indian Reservation ], supra [447 U.S. 134, 100 S.Ct. 2069, 65 L.Ed.2d 10 (1980) ], the tribe's interest in levying taxes on nonmembers to raise 'revenues for essential governmental programs ... is strongest when the revenues are derived from value generated on the reservation by activities involving the Tribes and when the taxpayer is the recipient of tribal services.' 447 U.S., at 156-157 [100 S.Ct., at 2082-2083]. This surely is the case here. The mere fact that the government imposing the tax also enjoys rents and royalties as the lessor of the mineral lands does not undermine the government's authority to impose the tax. See infra, [455 U.S.] at 145-148 [102 S.Ct. at 906-907]. The royalty payments from the mineral leases are paid to the Tribe in its role as partner in petitioners' commercial venture. The severance tax, in contrast, is petitioners' contribution 'to the general cost of providing governmental services.' "
50
In conclusion on the issue of the effect of the state price limitation it should be mentioned that a state regulation of prices is expressly provided for in the federal statute. Section 602(a) of the Natural Gas Policy Act of 1978 (15 U.S.C. Sec. 3301 et seq.). Also the Conference Report on the Natural Gas Act states in part that the reference to state authority to control expressly states that authority is thereby "ceded" under the Commerce Clause to regulate prices to "affected states." This in itself would seem to answer a claim that state price control does not apply to the intrastate gas. Thus such state price control prices are applicable and further the federal price control prices are applicable to royalties.
51
The judgment of the trial court is affirmed except as to:
52
1. The dual accounting/value of gas issue, and as to this it must be reversed and the matter is instead to be controlled by the long-standing and pre-litigation administrative construction of the leases and regulations. The judgment must also be reversed as to the related holding of breach of fiduciary duty by the Secretary.
53
2. We must also reverse as to the application of state price control as hereinabove described, and we also hold that federal price control prices are applicable in the determination and computation of royalty.
54
SEYMOUR, Circuit Judge, concurring in part and dissenting in part.
55
I concur in the majority's holding on the antitrust issues for the reasons set out in Part IV below. However, I cannot agree with the remainder of the majority's opinion. The court today declares that it can determine whether the Secretary properly interpreted and applied regulations dealing with royalties from resources owned by the Jicarilla Apache Tribe without first deciding whether the Secretary owes any duty of trust to the Tribe in these activities. The majority then rejects the trial court's interpretation of those regulations. Finally, the court holds that the New Mexico Natural Gas Pricing Act, N.M.Stat.Ann. Secs. 62-7-1 to -10 (1978) (NMNGPA), can function to diminish tribal royalties. Because I cannot agree with any of these conclusions, I must respectfully dissent.
I.
TRUST RESPONSIBILITIES
56
If the Secretary is obligated to act as a fiduciary to the Tribe in his administration of the Tribe's oil and gas reserves, and in his determination of what royalties the Tribe is due, then his actions must not merely meet the minimal requirements of administrative law, but must also pass scrutiny under the more stringent standards demanded of a fiduciary. Therefore, the need to determine whether the Secretary owes any duty of trust to the Tribe is unavoidable.
57
The notion that the Secretary, as a representative of the federal government, stands in a special relationship in general to the Indian tribes is not a novel proposition and needs neither extensive discussion nor citation. See, e.g., United States v. Kagama, 118 U.S. 375, 383-84, 6 S.Ct. 1109, 1113-14, 30 L.Ed. 228 (1886); Cherokee Nation v. Georgia, 30 U.S. (5 Pet.) 1, 17, 8 L.Ed. 25 (1831). The Supreme Court has continually recognized "the distinctive obligation of trust incumbent upon the Government," Seminole Nation v. United States, 316 U.S. 286, 296, 62 S.Ct. 1049, 1054, 86 L.Ed. 1480 (1942), in its dealings with the Indian tribes.1 See, e.g., United States v. Mitchell (Mitchell II), --- U.S. ----, 103 S.Ct. 2961, 2972, 77 L.Ed.2d 580 (1983). Because of this trust relationship the Government, in both its executive and legislative branches, is held to a high standard of conduct, one consonant with its "moral obligations of the highest obligation and trust." Seminole Nation v. United States, 316 U.S. at 297, 62 S.Ct. at 1054. For the same reason, whenever doubt or ambiguity exists in federal statutes or regulations, such doubt is resolved in favor of the tribes. See, e.g., Bryan v. Itasca County, 426 U.S. 373, 392, 96 S.Ct. 2102, 2112, 48 L.Ed.2d 710 (1976).
58
In addition to the all-pervasive "general trust relationship between the United States and the Indian people ... [that] has long dominated the Government's dealings with Indians," Mitchell II, 103 S.Ct. at 2972, the Supreme Court has declared that other, context-specific trust relationships of varying depth and responsibility exist. Id.; compare United States v. Mitchell (Mitchell I), 445 U.S. 535, 542, 546, 100 S.Ct. 1349, 1353, 1355, 63 L.Ed.2d 607 (1980) (General Allotment Act creates a limited trust relationship, not a fiduciary responsibility for management of allotted forest lands) with Mitchell II, 103 S.Ct. at 2972 (other federal statutes and regulations establish a full fiduciary relationship in management of allotted forest lands).
59
Both the Supreme Court and this circuit have recently set out the test for determining a trust relationship. In Whiskers v. United States, 600 F.2d 1332 (10th Cir.1979), cert. denied, 444 U.S. 1078, 100 S.Ct. 1028, 62 L.Ed.2d 761 (1980), we made it clear that no particular words or phrases are critical to the finding of a trust relationship. "[T]he use of the word 'trustee' is not absolutely essential to the finding of a trust relationship when it is otherwise clear that Congress intended a trust relationship to exist." Id. at 1338. Rather, the test is whether "the relevant statutory and regulatory provisions [contain] an enumeration of duties which would justify a conclusion that Congress intended the Secretary to be a trustee." Id. In Mitchell II, the Court reviewed the statutes and regulations establishing the particular relationship between the government and the Indians to determine whether they "give the Federal Government full responsibility to manage Indian resources and land for the benefit of the Indians." 103 S.Ct. at 2972. Finding that they did so, the Court concluded, "[t]hey thereby establish a fiduciary relationship and define the contours of the United States' fiduciary responsibilities." Id.
60
In Mitchell II, the Supreme Court determined that the Secretary owed Indian tribes a duty of trust in administering the sale of timber on Indian lands. Because the statutory and regulatory scheme in Mitchell II parallels that involved here, I believe Mitchell II governs the resolution of this issue.
61
In finding a trust relationship in Mitchell II, the Court noted that the Secretary plays a "pervasive role" in sales of timber from Indian lands. 103 S.Ct. at 2969. The Court then carefully examined the statutes dealing with sales of timber on reservation land, the legislative history underlying the statutes, and the regulations explicating them, finding it significant that "[t]he Department of the Interior ... 'exercises literally daily supervision over the harvesting and management of tribal timber.' ... Virtually every stage of the process is under federal control." Id. 103 S.Ct. at 2971 (quoting White Mountain Apache Tribe v. Bracker, 448 U.S. 136, 147, 100 S.Ct. 2578, 2585, 65 L.Ed.2d 665 (1980)) (footnote omitted). The Court found that "the Government has 'expressed a firm desire that the Tribe should retain the benefits derived from the harvesting and sale of reservation timber,' " id. 103 S.Ct. at 2972 (quoting White Mountain Apache Tribe v. Bracker, 448 U.S. at 149, 100 S.Ct. at 2586). Accordingly, it held that a fiduciary relationship was established.
62
In addition to finding a trust duty expressed in the statutes and regulations, the Court declared that
63
"a fiduciary relationship necessarily arises when the Government assumes such elaborate control over forests and property belonging to Indians. All of the necessary elements of a common-law trust are present: a trustee (the United States), a beneficiary (the Indian allottees), and a trust corpus (Indian timber, lands, and funds). '[W]here the Federal Government takes on or has control or supervision over tribal monies or properties, the fiduciary relationship normally exists with respect to such monies or properties (unless Congress has provided otherwise) even though nothing is said expressly in the authorizing or underlying statute (or other fundamental document) about a trust fund or a trust or fiduciary connection.' Navajo Tribe of Indians v. United States, 224 Ct.Cl. 171, 183, 624 F.2d 981, 987 (1980)."
64
Id. (footnote omitted) (emphasis added).
65
Leasing of minerals located on Indian reservations is also a creature of federal statute. As in timber harvesting, the federal government's role in mineral leasing is pervasive and its responsibilities comprehensive. The Indian Mineral Leasing Act of 1938, 25 U.S.C. Secs. 396a-396g (1976), requires the Secretary to: set the "terms" and "conditions" for leasing, id. Sec. 396b; approve leases, id. Sec. 396a; establish lease sale procedures, id. Sec. 396b; reject unsatisfactory bids, id.; require satisfactory performance bonds of lessees, id. Sec. 396c; promulgate rules and regulations governing "all operations" under leases, id. Sec. 396d; and approve leases for subsurface storage when necessary to avoid waste, or to promote conservation of resources, or to protect tribal welfare, id. Sec. 396g. The evident purpose of the statute is to ensure that Indian tribes receive the maximum benefit from mineral deposits on their lands through leasing.
66
This interpretation is supported by the Act's legislative history. When the Act was proposed, the Secretary of the Interior urged that the legislation be enacted because "it is not believed that the present law is adequate to give the Indians the greatest return from their property." Senate Report No. 985 at 2 (1937); House Report No. 1872 at 2 (1938). Congress responded to the need to ensure that the Indians' welfare be protected and their natural resources be managed to the tribes' maximum benefit by emphasizing the Secretary's fiduciary obligations, directing the Secretary to approve lease sales only when they are "in the interest of the Indians." Id.
67
Interior has promulgated extensive regulations for managing leases under the Act. See 25 C.F.R. pt. 211 (1982). The regulations stress that the Secretary must act in the best interests of the tribes. See, e.g., id. Secs. 211.3(b), .6(a), .9(b)(1), .12(a), .19, .21(a), .22, .27. Additional regulations, published in 30 C.F.R. Part 221, require the government to maintain comprehensive records of price and production, and to determine royalties. 30 C.F.R. Sec. 221.12. These regulations detail in exhausting thoroughness the government's management and regulatory responsibilities. See id. pt. 221.
68
Because the statutes and regulations contain such an explicit and detailed enumeration of duties, in my view Mitchell II compels the conclusion that Congress intended the Secretary to be a trustee.2 See 103 S.Ct. at 2971-72.
II.
BREACH OF TRUST
69
The trial court in this case concluded that Interior had breached its fiduciary duty in several respects: by failing to interpret correctly the royalty terms in the lease and regulations, by failing to insure that lessees comply with lease terms requiring diligent development, and by failing to insure the protection of leased lands from drainage. Jicarilla Apache Tribe v. Supron Energy Corp., 479 F.Supp. 536, 547-51 (D.N.M.1979). The trial court entered a declaratory judgment against the Secretary.3 The majority opinion reverses the trial court's construction of the lease and the regulations, and finds it unnecessary to reach the other breach of trust issues. I disagree, and would affirm the trial court on each of these matters.
A. The Regulations
70
The trial court stated the issue to be whether "the Secretary has breached his fiduciary duty because the method by which he computed royalties did not derive for the Tribe the highest royalties payable under the lease terms and the federal regulations." Id. at 549. The court then found that a breach had occurred. Id. at 551. The issue presented to us on appeal is one of interpretation of regulations, and not whether the Secretary was acting in accordance with his fiduciary obligations in promulgating the regulations initially.
71
At the time this litigation began, the Secretary used the BTU method to calculate royalties due the Tribe. One of the objectives sought by the Tribe was to compel Interior to calculate royalties using the net realization method as well, and to apply whichever method resulted in the greatest income to the Tribe. Sometime during the trial below, Interior evidently adopted the position that the lease and regulation terms authorized utilization of both methods of accounting (dual accounting), and that it has the discretion to require payment of royalties based on the method assuring the Tribe the highest return. See Rec., supp. vol. I, at 141-44.
72
On its cross-appeal to this court, Interior specifically "does not appeal the district court's holding that the 'dual accounting' method is the appropriate means of calculating royalties." Brief for the Secretary of the Interior at 9. Indeed, in its reply brief, Interior vigorously defends the trial court's holding on that issue against attack by defendant-lessees, concluding: "In short, the terms of the lease and the regulations grant the Secretary the authority to determine the value of the production at the lease on the basis of the value of the constituent commodities." Reply Brief for the Secretary of the Interior at 7. Moreover, the Secretary acknowledges his "broad discretion to determine the value of production in the way he considers will best protect the royalty interest of the lessor." Id. at 10-11. Thus, the Secretary has adopted the view that interpreting the royalty terms to require dual accounting by the Jicarilla's lessees is reasonable. This interpretation is in accordance, so far as it goes, with the trial court's holding.
73
Without considering either Interior's current interpretation of its royalty provisions or its role as trustee, the majority disagrees with the trial court's interpretation and finds instead that dual accounting is not required under the regulations. The majority refuses to "set aside the Secretary's construction of his regulation and lease which was followed and applied without exception for these many years, a construction which has a perfectly reasonable basis in the lease and in the regulations." At 1559. It bases its opinion on the discretion granted the Secretary specifically by the lease terms and in "the regulation of oil and gas matters," because "the Secretary's interpretation was and is in conformance with the practices in the industry," and because the Secretary's action was not shown to be arbitrary or capricious. Id. The majority then states that "[w]hen the prevailing doctrine in this circuit is then applied to these circumstances we must conclude that the administrative interpretation ... must be applied," id. at 1560, adding that "[t]he Secretary's position is consistent with case law in this circuit. See Barby v. Cabot Corporation, 465 F.2d 11 (10th Cir.)," id.
74
I am at a loss to discern what the majority has in mind when it refers to "the prevailing doctrine in this circuit." Initially, I note that Barby dealt with the interpretation of lease terms entered into between two private parties and is therefore irrelevant to this case which involves the interpretation of federal regulations and fiduciary duties. I also do not see what relevance "industry practices" have to the Secretary's interpretation of federal law.
75
In my view, however, the most significant error the majority makes is its employment of administrative law analysis without considering what role, if any, the Secretary's fiduciary duty should play in a court's examination of his administrative action. As I have pointed out, the Secretary's actions in a situation such as this are constrained by principles of Indian trust obligations as well as by standards of administrative law.
76
The Supreme Court has implicitly recognized that stricter standards apply to federal agencies when administering Indian programs. See Morton v. Ruiz, 415 U.S. 199, 236, 94 S.Ct. 1055, 1075, 39 L.Ed.2d 270 (1974); D. Getches, D. Rosenfelt & C. Wilkenson, Federal Indian Law 135-36 (1979). When the Secretary is acting in his fiduciary role rather than solely as a regulator and is faced with a decision for which there is more than one "reasonable" choice as that term is used in administrative law, he must choose the alternative that is in the best interests of the Indian tribe. In short, he cannot escape his role as trustee by donning the mantle of administrator, a principle recently made explicit by this court in Jicarilla Apache Tribe v. Andrus, 687 F.2d 1324 (10th Cir.1982):
77
"We are convinced ... that the plain, mandatory terms of the regulations do not leave room for deference to this interpretation, which does not serve the interest of the Indians. If there is any doubt, the interpretation should be made liberally in favor of the Indians for whose protection these provisions were promulgated. Antoine v. Washington, 420 U.S. 194, 199, 200, 95 S.Ct. 944, 948, 43 L.Ed.2d 129; Bryan v. Itasca County, 426 U.S. 373, 392, 96 S.Ct. 2102, 2112, 48 L.Ed.2d 710. This rule of construction pertaining to statutes and treaties should also govern the interpretation of the regulations. Regulations are generally subject to the same rules of construction as statutes. Rucker v. Wabash Railroad Co., 418 F.2d 146, 149 (7th Cir. [ (1969) ]."
78
Id. at 1332.
79
Thus, the true issue in this case is not whether the Secretary's earlier application of the royalty terms was reasonable; rather, it is whether the alternative interpretation requiring dual accounting is also reasonable and better promotes the Tribe's interest. If so, dual accounting should have been required from the beginning.
80
Two sets of regulations and the lease terms are determinative of the Tribe's royalty claim. Title 25 and Title 30 of the C.F.R. each contain regulations addressing royalty calculations. The lease form at issue incorporates both sets of regulations by reference, and the royalty provision contained in the leases either quotes or paraphrases the relevant regulations printed in Title 25. Accordingly, the following discussion referring to both titles of the C.F.R. should be read as referring to the lease as well. The regulations at issue are reproduced in pertinent part in an appendix to this opinion.
81
The regulations contained in 25 C.F.R. require lessees to pay a royalty on the value or amount of all gas and other hydrocarbon substances produced from the lease.4 25 C.F.R. Sec. 211.13 (1982) (formerly codified at 25 C.F.R. Sec. 171.13). Section 211.13 contains a "favored nation clause" for calculating value: " 'value' ... may ... be calculated on the basis of the highest price paid or offered ... at the time of production for the major portion of ... gas ... [and] all other hydrocarbon substances produced and sold from the field .... The actual amount realized by the lessee from the sale of said products may ... be deemed mere evidence of or conclusive evidence of such value." Id. The regulation adds that the calculated value of products derived from treatment of gas should include an allowance for manufacturing costs. More importantly for the purposes of this case, however, the regulation states that "royalty will be computed on the value of gas or casing-head gas, or on the products thereof ... whichever is the greater." Id. (emphasis added).
82
Title 30 of the C.F.R. contains extensive provisions to be used in calculating royalties. The threshold regulation, cited by the majority, states that
83
"(a) Royalty accrues on the dry gas, whether produced as such or as residue gas after the extraction of gasoline.
84
"(b) If the lessee derives revenue on gas from two or more products, a royalty normally will be collected on all such products.
85
"(c) For the purpose of computing royalty the value of wet gas shall be either the gross proceeds accruing to the lessee from the sale thereof or the aggregate value determined by the Secretary of all commodities, including residue gas, obtained therefrom, whichever is greater."
86
30 C.F.R. Sec. 221.50 (1982). The second clause of subsection 221.50(c) authorizes Interior to use the aggregate value of the substances contained in wet gas, ensuring that the lessor will receive the true value of the gas and other hydrocarbons produced from its lands, regardless of the lessee's choice of marketing tactics. Subsection (c) does not by its terms require that the lessee itself extract liquids before the Secretary may utilize aggregate value computing; to the contrary, it appears to apply in all situations. By using the term "aggregate value," rather than "proceeds," the subsection allows the Secretary to use aggregate value in situations where the lessee does not in fact process wet gas or otherwise directly receive "proceeds" from the processing. The majority's interpretation ignores the distinction made in the regulation and, in fact, makes the first clause of subsection (c) irrelevant and redundant in light of subsection (b). The majority interprets subsection (c) to say in effect that when the lessee processes wet gas itself (and, presumably, sells the constituent products), the lessee must pay royalties on all the products--precisely what subsection (b) requires.
87
Moreover, practical considerations support this construction. The lessees argue that the dual accounting method of calculating royalties mandated by subsection 221.50(c) applies only when the lessees themselves extract the liquids from the wet gas and market the various products. They assert that dual accounting cannot be used when they merely sell unrefined wet gas to another company, because the other company is the one deriving the higher proceeds from the sales of the various derivative products. However, as I have stated, the purpose of the Indian Mineral Leasing Act is to ensure that Indian tribes receive the maximum benefit from mineral deposits on their lands, see slip op., dissent, at 6, and we should construe regulations enacted under this Act in light of this purpose. Trustees of Indiana University v. United States, 618 F.2d 736, 739, 223 Ct.Cl. 88 (1980); Alaska Interstate Co. v. McMillian, 402 F.Supp. 532, 555 (D.Del.1975); see also Jicarilla Apache Tribe v. Andrus, 687 F.2d 1324, 1332 (10th Cir.1982) (regulations generally subject to same rules of construction as statutes).
88
Adopting the lessee's construction of the regulations would too easily enable lessees of Indian oil and gas leases to avoid the purpose of the Act. If the value of wet gas is increased by processing, it is in every lessees' best interest to have their royalty payments calculated on the value of unrefined wet gas, rather than on the aggregate value of the various products. Under the lessee's construction, to obtain the advantage of royalties calculated on the lower, wellhead price, all a lessee need do is sell the unprocessed wet gas to a cooperative third party, pay the lower royalties, and then reap the benefits of the higher proceeds from the extracted products through a sweetheart deal with the third party. In my view, it is as "reasonable" to construe these regulations in a way that prevents easy avoidance of the clear congressional intent of the Act as it is to adopt the majority's position.
89
The regulations thus provide support for the position urged by the Secretary on appeal. As I have noted, our initial determination is whether the trial court's and the Secretary's construction of the royalty regulations is reasonable. I believe that it is. Given two reasonable interpretations, Interior's trust responsibilities require it to apply whichever accounting method (BTU or net realization) yields the Tribe the greatest royalties. I would affirm the trial court on this point.
90
B. The Secretary's Administration of the Leases
91
The trial court found that the defendant-lessees had not failed to diligently develop the leases in question. Nonetheless, the trial court found that fact fortuitous because the Secretary had "failed to adequately monitor development of these leases sufficiently to insure compliance with the terms thereof," thereby breaching his fiduciary duty to the Tribe. 479 F.Supp. at 547. Similarly, the trial court found that there was no drainage, but concluded that the Secretary had been negligent in monitoring the potential problem, and thus had breached his fiduciary duties. Id. at 548.
92
The record supports the trial court's findings on both of these issues, and I would affirm.
III.
PREEMPTION
93
By order issued January 26, 1981, the district court held that the New Mexico Natural Gas Pricing Act does not apply either to sale prices received by lessees, or to royalties received by the Tribe. The majority disagrees, holding that the NMNGPA applies to both, even though it "is a limit on the size of the royalty owner's check." At 1562. The majority acknowledges that "[t]here is by reason of the state price control act an effect on the money the tribe receives from the sales," but concludes that this harmful aspect of state regulation is permissible because "there is no direct conflict with Indian self-government," id. at 1562.
94
Initially, I note that the State disagrees with the majority's viewpoint concerning tribal royalties. The State argues that the Act's price ceilings will not necessarily affect the Tribe's royalties, because royalties need not be limited to proceeds received by the lessees.5 See Brief of Cross-Appellant State of New Mexico at 56-58. This argument is in line with my construction of the federal regulations. In the State's view, the trial court correctly held that value for royalty purposes can exceed sale prices, and thus can exceed the price limits established by the NMNGPA. Indeed, the NMNGPA itself provides that the maximum allowable base prices established by the Act for natural gas "shall be exclusive of, ... if provided for by contract, that portion of royalty payable on a value in excess of the contract sales price." N.M.Stat.Ann. Sec. 62-7-3 (1982). Thus, in future contracts the Tribe can clearly avoid any effect upon its royalties by the Act. By implication, however, the Act might be interpreted to limit tribal royalties when not expressly avoided by contract terms, as in this case. I reject this conclusion for the reasons set forth in this opinion.
95
The majority's analysis of the effect of the New Mexico Act on "Indian self-government" relies upon a mistaken view of the significance of Washington v. Confederated Tribes of the Colville Indian Reservation, 447 U.S. 134, 100 S.Ct. 2069, 65 L.Ed.2d 10 (1980), and Moe v. Confederated Salish & Kootenai Tribes, 425 U.S. 463, 96 S.Ct. 1634, 48 L.Ed.2d 96 (1976), which it cites as dispositive of this issue. I disagree both with the majority's analysis and with its reliance on Confederated Tribes and Moe. My analysis is limited to the question whether federal law preempts the State from placing a ceiling on royalties paid to Indians. I need not address whether the NMNGPA may properly apply a ceiling on the sale of gas produced from the reservation by non-Indian lessees, because even if such a ceiling is appropriate it would not limit the determination of the Tribe's royalties under my construction of the regulations.
96
The Indian Mineral Leasing Act guarantees to Indian tribes maximum royalties from oil and natural gas located on tribal lands. In spite of clear congressional intent to ensure that Indian tribes receive the maximum return from their natural resources by way of royalties, the majority holds that a state can frustrate that policy. I would hold to the contrary, because I believe that the New Mexico Act is preempted by federal law to the extent that it adversely affects tribal oil and gas royalties.
97
The Supreme Court has recently discussed at length the principles to be used in determining whether a state civil statute is applicable within a reservation. See White Mountain Apache Tribe v. Bracker, 448 U.S. 136, 141-45, 100 S.Ct. 2578, 2582-84, 65 L.Ed.2d 665 (1980). In pertinent part, the Court noted that
98
"[There are] two independent but related barriers to the assertion of state regulatory authority over tribal reservations and members. First, the exercise of such authority may be pre-empted by federal law.... Second, it may unlawfully infringe 'on the right of reservation Indians to make their own laws and be ruled by them.' ... The two barriers are independent because either, standing alone, can be a sufficient basis for holding state law inapplicable to activity undertaken on the reservation or by tribal members....
99
"The unique historical origins of tribal sovereignty make it generally unhelpful to apply to federal enactments regulating Indian tribes those standards of pre-emption that have emerged in other areas of the law. Tribal reservations are not States, and the differences in the form and nature of their sovereignty make it treacherous to import to one notions of pre-emption that are properly applied to the other. The tradition of Indian sovereignty over the reservation and tribal members must inform the determination whether the exercise of state authority has been pre-empted by operation of federal law.... As we have repeatedly recognized, this tradition is reflected and encouraged in a number of congressional enactments demonstrating a firm federal policy of promoting tribal self-sufficiency and economic development. Ambiguities in federal law have been construed generously in order to comport with these traditional notions of sovereignty and with the federal policy of encouraging tribal independence.... We have thus rejected the proposition that in order to find a particular state law to have been preempted by operation of federal law, an express congressional statement to that effect is required.... At the same time any applicable regulatory interest of the State must be given weight, ... and 'automatic exemptions "as a matter of constitutional law" ' are unusual."
100
Id. at 142-44, 100 S.Ct. at 2583.
101
As White Mountain Apache Tribe v. Bracker makes clear, whether a state law interferes with Indian self-government is only half of the appropriate analysis.6 The state law in question must also be examined for possible conflict with federal law. The Supreme Court has recently pointed out that the special doctrine of Indian preemption referred to in White Mountain Apache Tribe v. Bracker is considerably broader than other, more familiar forms of preemption. See New Mexico v. Mescalero Apache Tribe, --- U.S. ----, 103 S.Ct. 2378, 2386, 76 L.Ed.2d 611 (1983). State law and jurisdiction are preempted by operation of federal law if they interfere with or are incompatible with federal and tribal interests reflected in federal law,7 unless the state interests at stake are sufficient to justify the effect. Id. Without addressing the Indian self-government issue, I would hold that to the extent the state law is interpreted to place a ceiling on the Tribe's royalties, it conflicts impermissibly with federal law.
102
The Supreme Court has emphasized the existence of a "firm federal policy of promoting tribal self-sufficiency and economic development." White Mountain Apache Tribe v. Bracker, 448 U.S. at 143, 100 S.Ct. at 2583; see also New Mexico v. Mescalero Apache Tribe, 103 S.Ct. at 2386-87. This policy is demonstrated by federal statutes authorizing the sale of tribal resources for the tribes' benefit, such as the Indian Mineral Leasing Act. See id. 103 S.Ct. at 2387; see also White Mountain Apache Tribe v. Bracker, 448 U.S. at 143 & n. 10, 100 S.Ct. at 2583 & n. 10. The right to receive maximum royalties is a benefit granted by Congress to the tribes in the Leasing Act. The state law here imposes a maximum price ceiling lower than the federal ceiling on sales of gas by non-Indian lessees, and thus could operate to decrease tribal royalties. This result would interfere with the congressional policy embodied in the Indian Mineral Leasing Act.
103
It is therefore clear to me that the New Mexico Act is preempted by operation of federal law insofar as it has any harmful effect upon the Tribe's royalty revenue, unless sufficient state interests are at stake. The State points to no on-reservation actions by it justifying this intrusion. See id. 103 S.Ct. at 2387, 2390-91; White Mountain Apache Tribe v. Bracker, 448 U.S. at 150-51, 100 S.Ct. at 2587-88. In fact, as I have pointed out, New Mexico has conceded in this case that its ceilings on gas sales do not limit royalties. Nevertheless, the lessees assert that the State's justification for imposition of state price ceilings on gas sales by non-Indian lessees (that such price controls are necessary for the benefit of natural gas consumers) also justifies a comparable ceiling on tribal royalties under current contracts. The record contains no showing that the lack of a ceiling on royalties paid to Indians in New Mexico would have such a significant effect upon New Mexico consumers that imposition of the Act to limit royalties would be of vital interest to the State.
104
I conclude that the New Mexico Act is preempted under the principles enunciated in White Mountain Apache Tribe v. Bracker insofar as it might be applied to limit royalties received by the Tribe. The cases relied on by the majority are inapposite. The enterprise here--the production of reservation oil and gas--is far removed from those involved in Confederated Tribes and Moe, where the tribal contributions to the enterprises were "de minimus," New Mexico v. Mescalero Apache Tribe, 103 S.Ct. at 2390, and the product marketed was not generated from reservation resources, compare Confederated Tribes and Moe with White Mountain Apache Tribe v. Bracker. To the contrary, the production of tribal oil and gas clearly involves " 'value generated on the reservation by activities involving the Trib[e],' " New Mexico v. Mescalero Apache Tribe, 103 S.Ct. at 2390 (quoting Confederated Tribes, 447 U.S. at 156-57, 100 S.Ct. at 2082-83), and thus is protected from state interference.
105
The majority accepts the proposition that Congress delegated to the states the authority to regulate gas prices, and thus royalties, of gas produced on Indian reservations and sold intrastate. Far from being compelled, in my view this conclusion is belied both by the language of the Natural Gas Policy Act of 1978, 15 U.S.C. Secs. 3311-3432 (Supp. V 1981) (NGPA) and by our prior caselaw.
106
The NGPA provides in a section entitled "Effect on State laws":
107
"Nothing in this chapter shall affect the authority of any State to establish or enforce any maximum lawful price for the first sale of natural gas produced in such State which does not exceed the applicable maximum lawful price, if any, under subchapter I of this chapter."
108
Id. Sec. 3432(a). The power to regulate on Indian reservations has always resided in the federal government. That power can only be delegated by express language.
109
"As this court has recently emphasized, '[T]he cases stress that regulatory powers in Indian country or on Indian lands belong to the Congress except for inherent jurisdiction of the tribes. Congress may delegate this authority to the state, but when it does so it must be in specific terms.' "
110
Mescalero Apache Tribe v. New Mexico, 630 F.2d 724, 730 (10th Cir.1980) (quoting United States v. New Mexico, 590 F.2d 323, 328 (10th Cir.1978), cert. denied, 444 U.S. 832, 100 S.Ct. 63, 62 L.Ed.2d 42 (1979) (emphasis added)), vacated and remanded, 450 U.S. 1036, 101 S.Ct. 1752, 68 L.Ed.2d 234 (1981), aff'd, 677 F.2d 55 (10th Cir.1982), aff'd, --- U.S. ----, 103 S.Ct. 2378, 76 L.Ed.2d 611 (1983); see, e.g., Bryan v. Itasca County, 426 U.S. 373, 392, 96 S.Ct. 2102, 2112, 48 L.Ed.2d 710 (1976); Donovan v. Navajo Forest Products Industries, 692 F.2d 709, 711, 713 (10th Cir.1982). Section 3432(a) does not refer to Indian reservations, and clearly grants no authority to the states to regulate on-reservation activities. Absent a specific statement of congressional intent, it cannot represent congressional authorization for New Mexico to override the benefits conferred to the Indian tribes in the Indian Mineral Leasing Act.8
111
Even assuming that New Mexico has authority to regulate the sale price of gas sold by non-Indian lessees of Indian reservation leases, an issue that I have not reached, I conclude that Congress did not delegate to the states authority to place ceilings on the royalties the tribes are entitled to receive from such leases. Constitutionally, the New Mexico Act may not be permitted to affect the amount of royalties received by the Jicarilla Apache Tribe. The Secretary should not consider himself limited by wellhead prices conforming to the Act when establishing "value" for the purpose of computing tribal royalties.
IV.
ANTITRUST
112
In discussing section 8 of the Clayton Act, 15 U.S.C. Sec. 19 (1981), the majority opinion employs a rule of reason analysis to determine whether the existence of interlocking directors in violation of the Act is illegal. The few courts and authorities that have considered the issue have held that conduct violative of section 8 is illegal per se. See, e.g., Protectoseal Co. v. Barancik, 484 F.2d 585, 589 (7th Cir.1973); P. Areeda, Antitrust Analysis p 666 (3d ed. 1981); 4 Von Kalinowski, Antitrust Laws and Trade Regulation 21.02. It seems to me that if an interlocking directorate falls within section 8, which is very specific, the interlock is unlawful and no rule of reason analysis is necessary. Because the purpose of section 8 is to nip antitrust violations in the bud, TRW Inc. v. FTC, 647 F.2d 942, 946-47 (9th Cir.1981), injunctive relief for such a violation without proof of actual anticompetitive effect should be available under 15 U.S.C. Sec. 26 (1982) to protect "against threatened loss or damage by a violation." Id. (emphasis added).
113
In this case, however, plaintiff is seeking treble damages under section 4 of the Clayton Act, 15 U.S.C. Sec. 15 (1982), which requires "some showing of actual injury attributable to something the antitrust laws were designed to prevent." J. Truett Payne Co. v. Chrysler Motors, 451 U.S. 557, 562, 101 S.Ct. 1923, 1927, 68 L.Ed.2d 442 (1981) (emphasis added). Because I agree with the majority's conclusion that plaintiff here has failed to make the requisite showing of damage under section 4, I would affirm the district court on that basis only.
APPENDIX
Pertinent Regulations
114
25 C.F.R. pt. 211, Bureau of Indian Affairs (1982).
115
"Sec. 211.13 Rates of rentals and royalties under oil and gas leases.
116
"(a) The lessee shall pay ... a rental of $1.25 per acre per annum in advance during the continuance thereof, together with a royalty of 12 1/2 percent or the value of amount of all oil, gas, and/or natural gasoline, and/or all other hydrocarbon substances produced and saved from the land leased, save and except oil, and/or gas used by the lessee for development and operation purposes on the lease, which oil or gas shall be royalty free.... During the period of supervision, 'value' for the purposes of the lease may, in the discretion of the Secretary of the Interior, be calculated on the basis of the highest price paid or offered (whether calculated on the basis of short or actual volume) at the time of production for the major portion of the oil of the same gravity, and gas, and/or natural gasoline, and/or all other hydrocarbon substances produced and sold from the field where the leased lands are situated, and the actual volume of the marketable product less the content of foreign substances as determined by the supervisor. The actual amount realized by the lessee from the sale of said products may, in the discretion of the Secretary of the Interior, be deemed mere evidence of or conclusive evidence of such value.... In determining the value for royalty purposes of products, such as natural gasoline, that are derived from treatment of gas, a reasonable allowance for the cost of manufacture shall be made, such allowance to be two-thirds of the value of the marketable product unless otherwise determined by the Secretary of the Interior on application of the lessee or on his own initiative, and that royalty will be computed on the value of gas or casing-head gas, or on the products thereof (such as residue gas, natural gasoline, propane, butane, etc.), whichever is the greater."
117
....
118
"Sec. 211.21 Restrictions on operations.
119
"(a) Oil and gas leases issued under the provisions of the regulations in this part shall be subject to imposition by the Secretary of the Interior of such restrictions as to time or times for the drilling of wells and as to the production from any well or wells as in his judgment may be necessary or proper for the protection of the natural resources of the leased land and in the interest of the lessor. In the exercise of his judgment the Secretary of the Interior may take into consideration, among other things, the Federal laws, State laws, regulations by competent Federal or State authorities, lawful agreements among operators regulating either drilling or production, or both, and any regulatory action desired by tribal authorities."
120
30 C.F.R. pt. 221, Minerals Management Service (1982).
121
"Sec. 221.46 Quantity basis for computing royalties on natural gasoline, butane, propane, and other liquid hydrocarbon substances extracted from gas.
122
"(a) If the net output of a plant is derived from the gas obtained from only one leasehold, the quantity of gasoline or other liquid hydrocarbon substances of which computations of royalty for the lease are based is the net output of the plant.
123
"(e) The supervisor is authorized, whenever in his judgment neither method prescribed in paragraph (b) and (c) of this section is practicable, to estimate the production of natural gasoline, butane, propane, or other liquid hydrocarbon substances from any leasehold from: (1) The quantity of gas produced from the leasehold and transmitted to the extraction plant, (2) the gasoline, butane, propane, or other liquid hydrocarbon content of such gas as determined by test, and (3) a factor based on plant efficiency or recovery and so determined as to insure full protection of the royalty interest of the lessor."
124
"Sec. 221.47 Value basis for computing royalties.
125
"The value of production, for the purpose of computing royalty shall be the estimated reasonable value of the product as determined by the supervisor, due consideration being given to the highest price paid for a part or for a majority of production of like quality in the same field, to the price received by the lessee, to posted prices and to other relevant matters. Under no circumstances shall the value of production of any of said substances for the purposes of computing royalty be deemed to be less than the gross proceeds accruing to the lessee from the sale thereof or less than the value computed on such reasonable unit value as shall have been determined by the Secretary. In the absence of good reason to the contrary, value computed on the basis of the highest price per barrel, thousand cubic feet, or gallon paid or offered at the time of production in a fair and open market for the major portion of like-quality oil, gas, or other products produced and sold from the field or area where the leased lands are situated will be considered to be a reasonable value."
126
"Sec. 221.50 Royalty on gas.
127
"The royalty on gas shall be the percentage established by the terms of the lease of the value or amount of the gas produced.
128
"(a) Royalty accrues on dry gas, whether produced as such or as residue gas after the extraction of gasoline.
129
....
130
"(c) For the purpose of computing royalty the value of wet gas shall be either the gross proceeds accruing to the lessee from the sale thereof or the aggregate value determined by the Secretary of all commodities, including residue gas, obtained therefrom, whichever is greater."
131
"Sec. 221.51 Royalty on casing-head or natural gasoline, butane, propane, or other liquid hydrocarbon substances extracted from gas.
132
"A royalty as provided in the lease shall be paid on the value of one-third (or the lessee's portion if greater than one-third) of all casing-head or natural gasoline, butane, propane, or other liquid hydrocarbon substances extracted from the gas produced from the leasehold. The value of the remainder is an allowance for the cost of manufacture, and no royalty thereon is required. The value shall be so determined that the minimum royalty accruing to the lessor shall be the percentage established by the lease of the amount or value of all extracted hydrocarbon substances accruing to the lessee under an arrangement, by contract or otherwise, for extraction and sale that has been approved by the supervisor."
Pertinent Lease Terms
133
Lease Form No. 157, Oil and Gas Mining Lease--Tribal Indian Lands.
134
"3. In consideration of the foregoing, the lessee hereby agrees:
135
"(a) Bond.--To furnish such bond as may be required by the regulations of the Secretary of the Interior, with satisfactory surety, or United States bonds as surety therefor, conditioned upon compliance with the terms of this lease.
136
"(b) Wells--(1) To drill and produce all wells necessary to offset or protect the leased land from drainage or in lieu thereof, to compensate the lessor in full each month for the estimated loss of royalty through drainage; Provided, That during the period of supervision by the Secretary of the Interior, the necessity for offset wells shall be determined by the oil and gas supervisor and payment in lieu of drilling and production shall be with the consent of, and in an amount determined by the Secretary of the Interior; (2) at the election of the lessee to drill and produce other wells; Provided, That the right to drill and produce such other wells shall be subject to any system of well spacing or production allotments authorized and approved under applicable law or regulations, approved by the Secretary of the Interior and affecting the field or area in which the leased lands are situated; and (3) if the lessee elects not to drill and produce such other wells for any period the Secretary of the Interior may, within 10 days after due notice in writing, either require the drilling and production of such wells to the number necessary, in his opinion, to insure reasonable diligence in the development and operation of the property, or may in lieu of such additional diligent drilling and production require the payment on and after the first anniversary date of this lease of not to exceed $1 per acre per annum, which sum shall be in addition to any rental or royalty hereinafter specified.
137
"(c) Rental and royalty.--To pay, beginning with the date of approval of the lease by the Secretary of the Interior or his duly authorized representative, a rental of $1.25 per acre per annum in advance during the continuance hereof, the rental so paid for any one year to be credited on the royalty for that year, together with a royalty of 16 2/3 percent of the value or amount of all oil, gas and/or natural gasoline, and/or all other hydrocarbon substances produced and saved from the land leased herein, save and except oil, and/or gas used by the lessee for development and operation purposes on said lease, which oil or gas shall be royalty free. During the period of supervision, "value" for the purposes hereof may, in the discretion of the Secretary, be calculated on the basis of the highest price paid or offered (whether calculated on the basis of short or actual volume) at the time of production for the major portion of the oil of the same gravity, and gas and/or natural gasoline, and/or all other hydrocarbon substances produced and sold from the field where the leased lands are situated, and the actual volume of the marketable product less the content of foreign substances as determined by the oil and gas supervisor. The actual amount realized by the lessee from the sale of said products may, in the discretion of the Secretary, be deemed mere evidence of or conclusive evidence of such value. When paid in value, such royalties shall be due and payable monthly on the last day of the calendar month following the calendar month in which produced, when royalty on oil produced is paid in kind, such royalty oil shall be delivered in tanks provided by the lessee on the premises where produced without cost to the lessor unless otherwise agreed to by the parties thereto, at such time as may be required by the lessor; Provided, That the lessee shall not be required to hold such royalty oil in storage longer than 30 days after the end of the calendar month in which said oil is produced; And provided further, That the lessee shall be in no manner responsible or held liable for loss or destruction of such oil in storage caused by acts of God. All rental and royalty payments, except as provided in section 4(c) shall be made by check or draft drawn on a solvent bank, open for the transaction of business on the day the check or draft is issued, to the payee designated by the Area Director. All such rental and royalty payments shall be mailed to the oil and gas supervisor for transmittal to the payee designated by the Area Director. It is understood that in determining the value for royalty purposes of products, such as natural gasoline, that are derived from treatment of gas, a reasonable allowance for the cost of manufacture shall be made, such allowance to be two-thirds of the value of the marketable product unless otherwise determined by the Secretary of the Interior on application of the lessee or on his own initiative, and that royalty will be computed on the value of gas or casinghead gas, or on the products thereof (such as residue gas, natural gasoline, propane, butane, etc.), whichever is the greater.
138
....
139
"(f) Diligence, prevention of waste.--To exercise reasonable diligence in drilling and operating wells for oil and gas on the lands covered hereby, while such products can be secured in paying quantities; to carry on all operations hereunder in a good and workmanlike manner in accordance with approved methods and practice, having due regard for the prevention of waste of oil or gas developed on the land, or the entrance of water through wells drilled by the lessee to the productive sands or oil or gas-bearing strata to the destruction or injury of the oil or gas deposits, the preservation and conservation of the property for future productive operations, and to the health and safety of workmen and employees; to plug securely all wells before abandoning the same and to effectually shut off all water from the oil or gas-bearing strata; not to drill any well within 200 feet of any house or barn now on the premises without the lessor's written consent; to carry out at the expense of the lessee all reasonable orders and requirements of the oil and gas supervisor relative to prevention of waste, and preservation of the property and the health and safety of workmen; to bury all pipe lines crossing tillable lands below plow depth unless other arrangements therefor are made with the superintendent; to pay the lessor all damages to crops, buildings, and other improvements of the lessor occasioned by the lessee's operations; Provided, That the lessee shall not be held responsible for delays or casualties occasioned by causes beyond the lessee's control."
140
Rec., jt. app. vol. I, at 13-15.
1
The Government's willing assumption of its obligations to Indian tribes is exemplified by the language of the treaty entered into July 1, 1852 in Santa Fe with the Apache Nation. Article 11 of the Treaty contains the promise "that the government of the United States shall so legislate and act as to secure the permanent prosperity and happiness" of the Apache Nation. Treaty with the Apaches, 10 Stat. 979, 980 (1855)
2
This conclusion is supported by the Supreme Court's resolution of a case involving Interior-approved oil and gas leases on lands held by Indians under allotment act trust patents. In Poafpybitty v. Skelly Oil Co., 390 U.S. 365, 88 S.Ct. 982, 19 L.Ed.2d 1238 (1968), the defendant lessee argued that the plaintiff Comanche Indians had no standing to sue under the lease because Interior "ha[d] such complete control over the lease that only [the Secretary could] institute ... court action" for impairment of the Indians' interests under the lease. Id. at 372, 88 S.Ct. at 985. The Court, noting that the government had exercised supervisory authority over oil and gas leases "in considerable detail," rejected the defendant's argument, holding that the Indians were not precluded thereby from bringing suit. Id. at 373, 88 S.Ct. at 986. Concerning Interior's duties in the situation, the Court declared that "[i]f the Government does determine that there has been waste in violation of a lease, it will of course satisfy its trust obligation by filing the necessary court action." Id. (emphasis added)
3
The Tribe has, of course, another remedy for the Government's breach of its fiduciary obligations. "If in carrying out [its] role as representative [of the Tribe], the Government violated its obligations to the Tribe, then the Tribe's remedy is against the Government ...." Nevada v. United States, --- U.S. ----, 103 S.Ct. 2906, 2925 n. 16, 77 L.Ed.2d 509 (1983) (Rehnquist, J.). That action lies in the Court of Claims. See 28 U.S.C. Sec. 1505 (1976); United States v. Mitchell (Mitchell II), --- U.S. ----, 103 S.Ct. 2961, 2965, 77 L.Ed.2d 580 (1983). The Tribe has instituted a suit against the Government in the Court of Claims, which has been stayed pending this appeal
4
Natural gas is typically made up of several components in varying proportions. Generally, the gas at the wellhead consists of methane and ethane together with heavier components such as butane, propane, and natural gasoline. Where heavier components make up more than a standard percentage of the whole, the gas is called "wet" gas. When gas contains less than that percentage of heavier components, it is called "dry" gas. In the instant case, all of the gas produced from the tribal leases is wet gas
Gas lessees may market wet gas in two ways. First, a lessee may choose to process the gas and market it separated into its constituent parts. The lessee does this by extracting the heavier components or "liquids" in a processing plant, and then selling the various products. Alternatively, the lessee may choose to sell the wet gas as is to a third party, who will then process the gas for further resale.
This case involves two methods of royalty calculations. The "BTU Method" calculates the value of gas produced by measuring the volume and BTU content of the wet gas at the wellhead, from which the "value" of the gas is derived. The second method, called the "net realization" or "aggregate value" method, is calculated by determining the values of the component gases after they have been extracted through processing. The "value" of the gas is the aggregate value of the constituent gases, less a cost of processing allowance.
"Dual accounting," requiring the computation of the value of wet gas by both methods and the subsequent payment of royalties on the basis of whichever method yields the higher value, allows a lessee to market gas by whichever method it chooses and ensures that the lessor royalty holder receives the maximum return on its gas.
5
Interior also argues that value for royalty purposes can exceed governmentally imposed price ceilings. Reply Brief for the Secretary of the Interior at 8-12
6
The majority's reliance upon Montana v. United States, 450 U.S. 544, 101 S.Ct. 1245, 67 L.Ed.2d 493 (1980), is also misplaced. That case involved very narrow questions of tribal sovereignty and regulatory authority that are not present in this case. As the Court itself noted, "the regulatory issue before us is a narrow one ... the question of the power of the Tribe to regulate non-Indian fishing and hunting on reservation land owned in fee by nonmembers of the Tribe." Id. at 557, 101 S.Ct. at 1254. The Tribe is not asserting regulatory authority in this case. Additionally, the significance of a tribal land-base (lacking in Montana ) to questions of a tribe's sovereign authority has been noted repeatedly by courts and commentators. See, e.g., New Mexico v. Mescalero Apache Tribe, --- U.S. ----, 103 S.Ct. 2378, 2384, 76 L.Ed.2d 611 (1983). Accordingly, general principles of tribal sovereignty applicable to tribal authority over tribal land should not be extrapolated from Montana, a narrow, fact-bound case
7
Congress need not make any explicit statement for state law to be preempted in this context. White Mountain Apache Tribe v. Bracker, 448 U.S. 136, 144, 150-51, 100 S.Ct. 2578, 2584, 2587-88, 65 L.Ed.2d 665 (1980)
8
The lessees argue that part of the legislative history of the National Gas Policy Act of 1978, 15 U.S.C. Secs. 3311-3432 (Supp. V 1981) (NGPA), supports their delegation-of-authority argument. The Conference Report on the NGPA states:
"The conference agreement provides that nothing in this Act shall affect the authority of any State to establish or enforce any maximum lawful price for sales of gas in intrastate commerce which does not exceed the applicable maximum lawful price, if any, under Title I of this Act. This authority extends to the operation of any indefinite price escalator clause. The Congress enacts this provision with a recognition that it is ceding its authority under the commerce clause of the Constitution to regulate prices for such production to affected States."
H.R.Conf.Rep. No. 1752, 95th Cong., 2d Sess. 124-25, reprinted in 1978 U.S.Code Cong. & Ad.News, 8800, 8983, 9041. The first sentence of this discussion confirms the clear language of the statute. The last sentence is apparently at variance with the enacted language. As stated in text, Congress' power to regulate Indian affairs can only be delegated expressly.
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103 F.3d 125
Williamsv.City of New Orleans
NO. 95-30380
United States Court of Appeals,Fifth Circuit.
Nov 21, 1996
1
Appeal From: E.D.La., No. 73-CA-629-"G"
2
AFFIRMED.
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984 P.2d 200 (1999)
1999 OK 64
Jerry R. FENT and Margaret B. Fent, husband and wife, as resident taxpayers and voters of the State of Oklahoma, Petitioners,
v.
OKLAHOMA CAPITOL IMPROVEMENT AUTHORITY, a body corporate and politic of the Oklahoma of Oklahoma.
No. 92,390.
Supreme Court of Oklahoma.
June 28, 1999.
As Corrected June 28 and July 8, 1999.
Rehearing Denied July 13, 1999.
Russell B. Fister, Oklahoma City, Oklahoma for Petitioner.
Douglas F. Price, Assistant Attorney General, Oklahoma City, Oklahoma; Thomas J. Hilborne, Jr. of Hilborne & Weidman, Tulsa, Oklahoma; and Gary M. Bush of Fagin, Brown, Bush, Tinney & Kiser, Oklahoma City, Oklahoma for Respondent.
*203 PER CURIAM:
¶ 1 Under 73 O.S.1991, § 160, this Court is given exclusive original jurisdiction to determine the validity of bond issues proposed by respondent, Oklahoma Capitol Improvement Authority (OCIA). Petitioners, Jerry R. Fent and Margaret B. Fent (husband and wife), two resident taxpayers and registered voters of Oklahoma (hereafter taxpayers) brought this original proceeding challenging the constitutionality of two statutes, 73 O.S. Supp.1998, §§ 168.3 and 301, which together authorize OCIA to issue over $300 million dollars in bonds to fund various governmental projects.[1] Taxpayers seek disapproval of any bonds issued under the statutes, primarily based on the argument the bonds would create prohibited debt in violation of OKLA. CONST. art. 10, §§ 23,[2] 24[3] and 25[4] (balanced budget provisions) without a vote of the State's citizens. They also claim the statutes were passed in violation of one or more of the strictures of OKLA. CONST. art. 5, § 33. Section 33 requires revenue bills to originate in the State House of Representatives, that no such bill be passed in the last five days of a legislative session and that such bills must garner a 75% super-majority vote in both the State House and Senate to avoid being submitted to a vote of the people. OCIA asserts neither statute authorizes prohibited debt, that neither is a revenue bill controlled by § 33, and OCIA seeks approval of two proposed bond issues, one in the amount of $10 million dollars and the other in the amount of $155 million dollars.
*204 ¶ 2 We hold taxpayers have failed to show either § 168.3 or § 301 are unconstitutional. Neither authorizes debt in the constitutional sense because they only allow for the issuance of what are known as appropriation-risk or moral obligation bonds. Oklahoma constitutional balanced budget provisions are, thus, inapplicable. Further, §§ 168.3 and 301 are not revenue bills controlled by OKLA. CONST. art. 5, § 33 because their principal object is not the raising of revenue, but to provide adequate facilities and/or equipment for State agencies, departments and/or instrumentalities and no taxes are levied or authorized to be levied by either statute. Finally, the two proposed bond issues in the total amount of $165 million dollars sought to be approved by OCIA are valid as authorized by either § 168.3 or § 301.
PART I. STANDARD OF REVIEW.
¶ 3 In considering a statute's constitutionality, courts are guided by well established principles. Application of Oklahoma Capitol Improvement Authority, 1960 OK 207, 355 P.2d 1028, 1031. A heavy burden is cast on those challenging a legislative enactment to show its unconstitutionality and every presumption is to be indulged in favor of the constitutionality of a statute. Application of Oklahoma Capitol Improvement Authority, 1998 OK 25, 958 P.2d 759, 763, cert. denied ___ U.S. ___, 119 S.Ct. 174, 142 L.Ed.2d 142 (1998). If two possible interpretations of a statute are possible, only one of which would render it unconstitutional, a court is bound to give the statute an interpretation that will render it constitutional, unless constitutional infirmity is shown beyond a reasonable doubt. Gilbert Central Corp. v. State, 1986 OK 6, 716 P.2d 654, 658. A court is bound to accept an interpretation that avoids constitutional doubt as to the legality of a legislative enactment. Id.
¶ 4 It is also firmly recognized that it is not the place of this Court, or any court, to concern itself with a statute's propriety, desirability, wisdom, or its practicality as a working proposition. Application of Oklahoma Capitol Improvement Authority, supra, 355 P.2d at 1031; Oklahoma Industries Authority v. Barnes, 1988 OK 98, 769 P.2d 115, 119 (the judiciary cannot challenge the wisdom, need or desirability of any constitutionally valid legislation). Such questions are plainly and definitely established by our fundamental law as functions of the legislative branch of government. Application of Oklahoma Capitol Improvement Authority, supra, 355 P.2d at 1031. Respect for the integrity of our tripartite scheme for distribution of governmental powers commands that the judiciary abstain from intrusion into legislative policymaking. Oklahoma Industries Authority v. Barnes, supra, 769 P.2d at 119. A court's function, when the constitutionality of a statute is put at issue, is limited to a determination of the validity or invalidity of the legislative provision [Application of Oklahoma Capitol Improvement Authority, supra, 355 P.2d at 1031] and a court's function extends no farther in our system of government.
¶ 5 Furthermore, this Court recognized only last year that unless there is a specific constitutional prohibition, the Legislature has the right and responsibility to declare Oklahoma's fiscal policy. Application of Oklahoma Capitol Improvement Authority, supra, 958 P.2d at 763. Simply, in ruling on the constitutional validity of a statute relating to this State's fiscal affairs, we are not allowed to consider whether it is based on sound economic theory or whether it is the best means to achieve the desired result because such matters are for legislative determination. Id. With these principles understood, we turn to review the statutes involved here and the two proposed bond issues.
PART II. THE BONDS AUTHORIZED BY §§ 168.3 AND 301 ARE NOT DEBT IN A CONSTITUTIONAL SENSE BECAUSE THEY DO NOT CREATE A LEGAL OBLIGATION TO PAY STATE MONIES BEYOND A CURRENT ANNUAL LEGISLATIVE APPROPRIATION. BECAUSE THE BOND PROPOSALS BEFORE U.S. DO NOT CREATE PROHIBITED CONSTITUTIONAL DEBT, THE BUDGET BALANCING AMENDMENTS OF OKLA. CONST. ART. 10, §§ 23, 24 AND 25 ARE INAPPLICABLE.
¶ 6 Although we have considered all arguments raised by taxpayers in an attempt *205 to show the two statutes involved here and the bonds authorized to be issued thereunder, violate OKLA. CONST. art. 10, §§ 23, 24 and 25, we are convinced neither statute authorizes State debt as contemplated by those constitutional provisions and, therefore, those constitutional balanced budget provisions are simply inapplicable to the bonds sought to be issued and sold by the OCIA under the grant of authority contained in §§ 168.3 and 301. At most, the statutes authorize only appropriation-risk or moral obligation bonds, and under our previous cases the issuance and sale of such bonds do not create debt in a constitutional sense.
¶ 7 Section 168.3 authorizes OCIA to issue and sell bonds to fund certain building projects at the Oklahoma School of Science and Mathematics.[5] Section 301 authorizes *206 OCIA to issue and sell bonds to fund various governmental projects, ranging from construction of a new building for the J.D. McCarty Center for Children with Developmental Disabilities to the purchase of computer hardware and software for the Oklahoma Department of Central Services.[6]
*207 ¶ 8 As we interpret both statutes, OCIA is authorized thereunder to fund the costs of the various projects by borrowing monies on the credit of the income and revenues to be derived from the projects. The money borrowed will, of course, come from the issuance and sale of the bonds. In turn, the bonds are to be retired by payments made to OCIA by the various agencies, departments and/or instrumentalities using and/or benefitting from the projects under lease or other agreements with OCIA. Although each statute expresses an intent to appropriate sufficient monies to the various agencies, etc. to make such payments to OCIA for the purpose of retiring the bonds, nowhere in either statute is there a provision obligating a future legislature to do so. In such regard, we find applicable the following statement made only last year by this Court in a case concerning the approval of bonds proposed to be issued by OCIA to fund construction, repair and maintenance of state highways:
*208 Unquestionably, provisions obligating future legislatures are unconstitutional. However, here, there is simply nothing to bind future legislative bodies to make the anticipated appropriations. Future revenues are not pledged . . . for retirement of the proposed bonds. The present Legislature's intent to appropriate the monies is not a binding commitment on future legislatures to do so.
Application of Oklahoma Capitol Improvement Authority, supra, 958 P.2d at 771.
¶ 9 Further, the two bond resolutions before us each contain a copy of the form of bond to be sold and on the face thereof is contained the following disclaimer:
This bond is not an indebtedness of the State of Oklahoma, nor shall it be deemed to be an obligation of the State of Oklahoma and neither the faith and credit nor the taxing power of the State of Oklahoma or any political subdivision thereof is pledged or may hereafter be pledged to the payment of the principal of or the interest on this Bond or the series of which it forms a part. This Bond is not a general obligation of [OCIA] nor a personal obligation of the members of [OCIA], but it is a limited obligation payable solely from the revenues specifically pledged to its payment.
In substance, the two statutes at issue here, and the bonds which they authorize, are indistinguishable from those held valid by this Court on previous occasions. See Application of Oklahoma Capitol Improvement Authority, 1998 OK 25, 958 P.2d 759, cert. denied ___ U.S. ___, 119 S.Ct. 174, 142 L.Ed.2d 142 (1998); Application of Oklahoma Capitol Improvement Authority, 1966 OK 6, 410 P.2d 46; Application of Oklahoma Capitol Improvement Authority, 1960 OK 207, 355 P.2d 1028.
¶ 10 Like our previous cases, all the monies bond holders can expect to recover are actual appropriations made by individual legislative bodies. Application of Oklahoma Capitol Improvement Authority, supra, 958 P.2d at 772. "If [OCIA] doesn't have monies to retire the bonds, because legislative appropriations are not made, there is nothing for the bondholder to recover." Id. at 775. In other words, should future legislative bodies fail to appropriate sufficient funds to retire the bonds, the risk of default is assumed by the bondholders. At most, only appropriation-risk or moral obligation bonds are involved here, not legally enforceable ones, except to the extent each succeeding legislative body actually appropriates funds for their retirement. Furthermore, there is no legally enforceable contract between this State's Legislature and either OCIA, the various agencies, etc. or the citizens of Oklahoma to make the anticipated appropriations necessary to retire the bonds. Id. at 776. Simply, no debt or obligation as contemplated by OKLA. CONST. art. 10, §§ 23, 24 and 25 is created against the State if money is not appropriated and, thus, those provisions of our fundamental law are not applicable.[7]
*209 PART III. BECAUSE NEITHER § 168.3 NOR § 301 ARE REVENUE BILLS THE STRICTURES OF OKLA. CONST. ART. 5, § 33 ARE NOT IMPLICATED.
¶ 11 Petitioners also contend §§ 168.3 and 301 were passed by the Legislature in violation of one or more of the strictures contained in OKLA. CONST. art. 5, § 33 which provides:
A. All bills for raising revenue shall originate in the House of Representatives. The Senate may propose amendments to revenue bills.
B. No revenue bill shall be passed during the five last days of the session.
C. Any revenue bill originating in the House of Representatives shall not become effective until it has been referred to the people of the state at the next general election held throughout the state and shall become effective and be in force when it has been approved by a majority of the votes cast on the measure at such election and not otherwise, except as otherwise provided in subsection D of this section.
D. Any revenue bill originating in the House of Representatives may become law without being submitted to a vote of the people of the state if such bill receives the approval of three-fourths (¾) of the membership of the House of Representatives and three-fourths (¾) of the membership of the Senate and is submitted to the Governor for appropriate action. Any such revenue bill shall not be subject to the emergency measure provision authorized in Section 58 of this Article and shall not become effective and be in force until ninety days after it has been approved by the Legislature, and acted on by the Governor.
Because it is quite plain that neither § 168.3 nor § 301 are revenue bills within the contemplation of OKLA. CONST. art. 5, § 33, we assume for purposes of our disposition of this proposition that both statutes, as petitioners contend, were promulgated without meeting one or more of the strictures contained in § 33.
¶ 12 The accepted definition of a revenue bill falling under § 33 is the two-pronged test set forth in Leveridge v. Oklahoma Tax Commission, 1956 OK 77, 294 P.2d 809 First Syllabus: "[r]evenue [b]ills are those laws whose principal object is the raising of revenue and which levy taxes in the strict sense of the word, and said phrase does not cover laws under which revenue may incidentally arise." See also Walters v. Oklahoma Tax Commission, 1996 OK CIV APP 154, 935 P.2d 398, 401, cert. denied ___ U.S. ___, 118 S.Ct. 266, 139 L.Ed.2d 192 (1997), reh. denied ___ U.S. ___, 118 S.Ct. 592, 139 L.Ed.2d 428 (1997)(same) and Ramsey, What is a `Revenue Bill' Within the Meaning of Our Most Recent Constitutional Amendment, 63 Okla. B.J. 1567 (1992). In no sense can either § 168.3 or § 301 be considered a revenue bill controlled by § 33.
¶ 13 The principal object of § 168.3 is to provide adequate and proper facilities for the Oklahoma School of Science and Mathematics. The principal object of § 301 is to provide adequate and proper facilities and/or equipment for various State agencies, departments and/or instrumentalities. More importantly, no tax at all is either levied or authorized to be levied by either enactment. Accordingly, petitioners' assertion that one or more of the strictures of OKLA. CONST. art. 5, § 33 were violated in relation to the passage of §§ 168.3 and 301 is without merit because neither statute is a revenue bill controlled by § 33.[8]
*210 PART IV. CONCLUSION.
¶ 14 Neither § 168.3 nor § 301 are unconstitutional as authorizing debt in the constitutional sense because they only allow for the issuance of what are known as appropriation-risk or moral obligation bonds. Oklahoma constitutional balanced budget provisions are, thus, inapplicable. Further, neither provision is a revenue bill controlled by OKLA. CONST. art. 5, § 33 because their principal object is not the raising of revenue, but to provide adequate facilities and/or equipment for State agencies, departments and/or instrumentalities and, more importantly, no taxes are levied or authorized to be levied by either statute. Finally, the two proposed bond issues in the total amount of $165 million dollars sought to be approved by OCIA are valid as authorized by either § 168.3 or § 301.
¶ 15 ORIGINAL JURISDICTION ASSUMED; 73 O.S. SUPP.1998, § 168.3 AND § 301 AND BOND PROPOSAL ISSUES HELD CONSTITUTIONAL.[9]
¶ 16 Any petition for rehearing in regard to this matter shall be filed by noon, Tuesday, July 6, 1999.
¶ 17 SUMMERS, C.J., HARGRAVE, V.C.J., HODGES and SIMMS, JJ., concur.
¶ 18 KAUGER and WATT, JJ., concur specially.
¶ 19 LAVENDER, J., concurring in part; dissenting in part.
¶ 20 OPALA and ALMA WILSON, JJ., dissenting.
¶ 21 As to ¶ 16 of opinion HARGRAVE, V.C.J. and OPALA, J., not voting.
¶ 1 KAUGER, J. with whom SUMMERS, C.J. and WATT, J. join, concurring specially:
¶ 2 I agree with the majority that the proposed bond issues are constitutional within the meaning of the Okla. Const. art. 5, § 33[1] and art. 10, §§ 23,[2] 24[3] and 25.[4] I also acknowledge that the language contained in *211 the legislative enactments relating to the bond proposals is characteristic of that found in moral-obligation or appropriation-risk bonds. However, these bond proposals are not protected from attack merely through artful drafting. It is unnecessary to determine the character of the obligation created because these are traditional, self-liquidating proposals historically upheld by this Court's jurisprudence. Stare decisis demands their approval.
¶ 3 The majority opinion recognizes that the bonds are intended to fund "building projects for the Oklahoma School of Science and Mathematics" and other "projects ranging from construction of a new building for the J.D. McCarty Center for Children with Developmental Disabilities to the purchase of computer hardware and software for the Oklahoma Department of Central Services."[5] These are precisely the types of projects this Court has traditionally found constitutional under the Okla. Const. art. 10, §§ 23, 24 and 25.
¶ 4 In Application of Oklahoma Capitol Improvement Auth., 1966 OK 6, 410 P.2d 46, and Application of Oklahoma Capitol Improvement Auth., 1960 OK 207, 355 P.2d 1028, 1031, we characterized bonds for state office buildings as self-liquidating because the Legislature appropriated to the tenant state agencies monies sufficient to pay the rent which would amortize the bonds. Although no revenues derived from sources outside state appropriations were involved, the 1960 Court found that the bonds for state office buildings were self-liquidating. In both cases, "self-liquidating" entailed putting enough state dollars in one pocket to support the rental payments which had to be made from the other pocket. The construction projects here, like those at issue in Application of Oklahoma Capitol Improvement Auth., 1966 OK 6, 410 P.2d 46, and Application of Oklahoma Capitol Improvement Auth., 1960 OK 207, 355 P.2d 1028, 1031, involve arrangements where state buildings are rented by state agencies pursuant to multi-year leases scenarios approved in both the causes and identical to that of the capital and construction projects provided for in 73 O.S. Supp.1998 § 301.[6]
¶ 5 To the extent that the bond proposal provides for the purchase or upgrade of computer or other equipment, its constitutionality is also supported by our prior decisions. In U.C. Leasing, Inc. v. State ex rel. State Bd. of Public Affairs, 1987 OK 43, 737 P.2d 1191, 1195, we upheld a lease covering communications switching equipment. In Indiana Nat'l Bank v. State Dept. of Human Services, 1993 OK 101, 857 P.2d 53, 57, a lease for computer equipment was held constitutional against a debt-limitation attack.
¶ 6 The existence of language in the statute and in the bond proposals which might be construed as merely creating a moral obligation of their payment is irrelevant to the holding that the bonds do not create a prohibited debt within the meaning of the Okla. Const. art. 10, §§ 23, 24 and 25. Approval of the bonds is required based on Oklahoma's constitutional and statutory law and our controlling precedents all of which provide bona fide, separate, adequate and independent grounds for this decision.[7]
LAVENDER, J., concurring in part; dissenting in part, with whom OPALA and ALMA WILSON, JJ., join:
¶ 1 I concur in the majority opinion to the extent it holds neither 73 O.S. Supp.1998, *212 § 168.3 nor 73 O.S. Supp.1998, § 301 are controlled by the strictures of OKLA. CONST. art. 5, § 33. The statutes before us, as the majority opinion correctly holds, are not revenue bills within the meaning of § 33. They are not revenue bills governed by § 33 for the simple reason no taxes are levied or authorized to be levied by either statute. See Leveridge v. Oklahoma Tax Commission, 1956 OK 77, 294 P.2d 809 First Syllabus. Only statutes which levy taxes in the strict sense are considered revenue bills controlled by § 33. Id.
¶ 2 I must, however, dissent to the majority's holding that §§ 168.3 and 301do not violate OKLA. CONST. art. 10, §§ 23 and 25, Oklahoma's constitutional balanced budget provisions. I believe the statutes and the bonds which they authorize are unconstitutional because together they authorize massive borrowing (over $300 million dollars) by the State of Oklahoma and the legislative body authorizing the borrowing had every intent of binding future legislative assemblies to repay the money borrowed. In my opinion, such borrowing, with an express legislative intention to repay from future legislative appropriations, falls well within the confines of prohibited debt forbidden by this State's balanced budget provisions, in the absence of approval by Oklahoma's voters at the polls. To sanction this massive borrowing is to mortgage the futures of succeeding generations of Oklahomans i.e. this State's children and grandchildren for present expediency and is nothing less than deception by artful subterfuge or sophistry. Future generations should not be saddled with this debt until and unless they or their parents vote to sanction it, as is required by our fundamental constitutional law.
¶ 3 As I said last year in my dissent in Application of Oklahoma Capitol Improvement Authority, 1998 OK 25, 958 P.2d 759, 763, cert. denied ___ U.S. ___, 119 S.Ct. 174, 142 L.Ed.2d 142 (1998) when this Court is called upon to construe "the provisions of the Oklahoma Constitution, we must give effect to the intent of its framers and of the people who adopted it." 958 P.2d at 778 (Lavender, J. dissenting), relying on Boswell v. State, 181 Okla. 435, 74 P.2d 940, 942 (1937). Further, when a constitutional provision is unambiguous, courts are not at liberty to search for its meaning beyond the instrument itself. Id. The words of any constitutional provision must be given their ordinary and natural meaning. The intent of OKLA. CONST. art. 10, § 23, coupled with OKLA. CONST. art. 10, § 25, is that Oklahoma governmental projects including the projects authorized by §§ 168.3 and 301 are to be funded on a cash basis, i.e. on a fiscal year plan, and that long-term State debt reaching beyond the fiscal year may only be incurred by a vote of the people at the polls, including approval of some type of direct annual tax sufficient to pay the principal and interest on such a debt. 958 P.2d at 778-779 (Lavender, J., dissenting). Here, we have such long-term debt, but no vote of the people and no specification of any direct annual tax to pay for the debt. In plain and simple terms, §§ 168.3 and 301 were intended to violate, and have the effect of offending, our constitutional debt-limitation provisions. I am unable to give my approval to such a disregard of our fundamental law.
¶ 4 The majority says the massive borrowing, which will be paid back by subsequent fiscal year appropriations, is not debt in the constitutional sense because the bonds authorized by §§ 168.3 and 301 are merely what are known as appropriation-risk or moral obligation bonds, i.e. there is no commitment that binds future legislative assemblies to repay the bondholders. I do not agree.
¶ 5 Although this Court is not authorized to delve into the wisdom, need, or desirability of a legislative enactment [Oklahoma Industries Authority v. Barnes, 1988 OK 98, 769 P.2d 115, 119], we are authorized to look at, in fact we must look at, what the Legislature intended by its legislative provision. Oklahoma Ass'n for Equitable Taxation v. City of Oklahoma City, 1995 OK 62, 901 P.2d 800, 803, cert. denied 516 U.S. 1029, 116 S.Ct. 674, 133 L.Ed.2d 523 (1995)(determination of intent controls statutory interpretation). To ascertain what the Legislature intended, one should look to the language of the statutes under review and presume the legislative body intends what it expresses. Affiliated *213 Management Corp. v. Okla. Tax Com'n, 1977 OK 183, 570 P.2d 335, 337. Further, words in a statute are given their plain and ordinary meaning (just as with constitutional provisions), except when a contrary intention plainly appears [In re Guardianship of Campbell, 1966 OK 99, 450 P.2d 203, 206] and the words of a statute should generally be assumed to be used by the law-making body as having the same meaning as that attributed in ordinary and usual parlance. Matter of Income Tax Protest of Ashland Exploration, Inc., 1988 OK 23, 751 P.2d 1070, 1073. Finally, this Court recognized over sixty (60) years ago that, whether a statute authorizes a debt of the State contrary to our constitutional balanced budget provisions is a judicial question and not a legislative one. Boswell v. State, supra, 74 P.2d at 943.
¶ 6 When I read §§ 168.3 and 301 it is obvious to me from the plain language used by the legislative body that it was intended by those statutes to create a debt. A review of §§ 168.3 and 301 reveals that the following words or phrases "indebtedness", "indebtedness created", "debt created", "debt retirement", "obligations" and "debt service" are used in those legislative enactments a total of thirty-eight (38) times to refer to the bonds which are authorized to be sold by the Oklahoma Capitol Improvement Authority (OCIA) or to the bonds' repayment. Further, both statutes contain a direct expression of legislative intent to appropriate sufficient monies to retire the debt or obligations authorized to be created. § 168.3(B) and § 301(B). Without a vote of the people and their sanction of a direct annual tax to pay off a multi-year debt as required by OKLA. CONST. art. 10, § 25, multi-year debts or obligations are strictly forbidden by OKLA. CONST. art. 10, § 23, in the following pertinent language:
The state shall never create or authorize the creation of any debt or obligation, or fund or pay any deficit, against the state, or any department, institution or agency thereof, regardless of its form or the source of money from which it is to be paid, except as may be provided in this section and in Sections 24 and 25 of Article X of the Constitution of the State of Oklahoma.[1] (emphasis added)
¶ 7 The plain and ordinary meaning of the terms debt and obligation are as follows: debt is "something owed"; obligation is "a commitment (as by a government) to pay a particular sum of money". WEBSTER'S NEW COLLEGIATE DICTIONARY 289 and 785 (1979). Giving such terms their plain and ordinary meanings it is beyond question, at least in my view, that §§ 168.3 and 301 were intended by the Legislature to authorize the creation of debts or obligations, i.e. to exhibit a commitment to have future legislative bodies appropriate monies to pay off the holders of any bonds sold. In my opinion, no amount of legal semantics, word-massaging or linguistic subterfuge can turn this express commitment into some non-enforceable moral obligation to repay. To rule otherwise this Court must hold the Legislature does not mean debt when it says debt, does not mean obligation when it says obligation, and does not mean indebtedness when it says indebtedness. I am unwilling to engage in such interpretative gymnastics because to do so would ignore the plain meaning of the statutes before us and would disregard the obvious reality that future legislatures will appropriate monies to pay back the millions of dollars borrowed from the bondholders.
¶ 8 I also must distinguish the situation evident in the instant matter from those cases where this Court has approved multi-year leases of office equipment that were subject to termination on a year-to-year basis if insufficient legislative appropriations are made to make any particular year's lease payments. See Indiana Nat. Bank v. State Dept. of Human Services, 1993 OK 101, 857 P.2d 53; U.C. Leasing, Inc. v. State ex rel. State Bd. of Public Affairs, 1987 OK 43, 737 P.2d 1191. In the multi-year lease cases, if insufficient legislative appropriations are made, the equipment is merely returned to the lessor, the lease is at an end and no further payments are due to the lessor. *214 Here the State, through OCIA, is purchasing equipment and land, and constructing buildings and other facilities that will immediately be owned by the State. Such equipment and facilities cannot merely be given back to a lessor or vendor upon default in paying the bondholders and have the debt created in favor of the bondholder come to an end. Here the debt owed to the bondholders remains until it is repaid.
¶ 9 Further, although some of the projects funded by the monies generated from sale of the bonds involved here might generate sufficient revenue to be considered self-liquidating under our previous jurisprudence[2] no attempt has been made in the legislation before us to identify such projects. Instead, the enactments at issue, in express terms, rely on general revenue legislative appropriations to pay back the money borrowed from the bondholders. I, therefore, find the following language from Justice Opala's dissent in Application of Oklahoma Capitol Improvement Authority, supra, to state my view as to why the situation here cannot be considered to be self-liquidating:
The undeniable fact in the scheme used here for repayment is that there is a total reliance on legislative appropriations. The project cannot generate any tangible revenue of its own. There is no possibility of repayment without dependence on annual legislative appropriations. This alone prevents the proposed transaction from qualifying as a `self-liquidating' project's obligation.
958 P.2d at 781. As Justice Opala also correctly pointed out in the same dissent, the state is simply not authorized to accept without an antecedent approval by a vote of the people the proceeds of a loan that will not pass muster as a "self-liquidating" project's obligation. Id. at 779.
¶ 10 The sanctioning of the instant bond issue and the Court's approval of the highway bond issue last year in Application of Oklahoma Capitol Improvement Authority, supra, have completely obliterated our fundamental balanced budget provisions. The Court has now, in essence, given its approval to over $450 million in debt that will be paid back out of future general revenue legislative appropriations without a vote of the people as required by our Constitution. How many hundreds of million dollars more will be borrowed in this manner before it is realized the legislation before us, or that of a similar ilk, creates a debt in contravention of Oklahoma's constitutional fabric? The answer, I fear, lies in the prediction of my colleague, Justice Watt, when in dissent to the denial of rehearing in Application of Oklahoma Capitol Improvement Authority, supra, the highway bond case, he stated in the following language:
The majority . . . by its vote today, sanctions the State's use of long-term debt financing without a vote of the people. The actions of the Legislature and of the majority of this Court in ratifying them do not simply whittle away at the clear protecting mandates of Article 10, §§ 23 and 25 of the Oklahoma Constitution, their actions gut the State's balanced budget amendments. Pursuant to the majority's rationale, the State will never create a legally binding obligation against itself if it issues bonds that contain certain "magic" language disavowing the creation of any such debt, regardless of the economic realities of the situation. No decision of this Court should rest upon such a fallacy.
What is particularly disturbing about the ratification of the current bond issue is that this is just the tip of the iceberg. Our citizenry would be well advised to prepare for future large-scale deficit financing of capital projects by State officials. Approximately two-thirds of the on-going one billion dollar road improvement legislation will be financed via these so-called "moral obligation" bonds. There is evidence in the record that suggests similar bonds for prison construction is next. The majority's decision will serve as no legal impediment for the issuance of "moral obligation" bonds for any capital improvement project. *215 The taxpayers will eventually be called upon to foot the bill. (emphasis in original)
958 P.2d at 795.
¶ 11 Indeed, the taxpayers will foot the bill without their approval as required by the clear, unambiguous and plain meaning of our fundamental law. I cannot sanction such a result and, therefore, dissent to that part of the majority opinion holding that §§ 168.3 and 301do not violate OKLA. CONST. art. 10, §§ 23 and 25, Oklahoma's constitutional balanced budget provisions.
WATT, J. concurring specially:
¶ 1 I join Justice Kauger in her specially concurring opinion. I write, however, to make clear my conclusion that my dissent in In Re: Oklahoma Capitol Improvement Authority, 1998 OK 25 ¶¶ 1-2, 958 P.2d 759, has nothing to do with the facts of the case at bar.
¶ 2 Although Justice Lavender has cited to my dissent in Oklahoma Capitol Improvement Authority at ¶ 10 of his opinion concurring in part and dissenting in part, I do not believe that my analysis in my dissent applies here. I dissented there because the roads being financed by the bonds in that case produced no revenues with which the bonds could be repaid. Here, however, as Justice Kauger observed in her specially concurring opinion, at ¶ 2, "It is unnecessary to determine the character of the obligation created because these are traditional, self-liquidating proposals historically upheld by this Courts jurisprudence. Stare decisis demands their approval." For this reason I believe there is ample authority other than Oklahoma Capitol Improvement Authority supporting the conclusion that the bonds at issue here are constitutional. Thus, I see no reason to dissent to the majority opinions approval of the bonds at issue here and decline to do so.
ALMA WILSON, J., with whom LAVENDER and OPALA, JJ., join, dissenting:
¶ 1 The Oklahoma Capitol Improvement Authority may not borrow money that is to be repaid via legislative appropriations over a number of years unless the voters of Oklahoma have approved the law authorizing the debt.[1] Very simply, the Legislature stands accountable to the people before a debt-authorizing statute may be carried out. I cannot turn away the people's constitutional right to vote for or against the statutes before us today.[2] Accordingly, I respectfully dissent to the approval of the instant bond proposals for all the reasons set forth in my dissenting opinions in Application of Oklahoma Capitol Improvement Authority, 1998 OK 25, 958 P.2d 759, 782, and 795, cert. denied, ___ U.S. ___, 119 S.Ct. 174, 142 L.Ed.2d 142 (1998). Further, I would allow at least ten days within which rehearing may be sought.
OPALA, J., receding from the court's opinion and joining the dissenting view by LAVENDER, J.
¶ 1 I recede from today's pronouncement for the reasons expressed in Application of Oklahoma Capitol Improvement Authority (Opala, J., dissenting)[1] and join the dissenting view by Lavender, J.
*216 ORDER
¶ 1 Original jurisdiction is assumed as to the issue of disqualification of all of the Justices of the Oklahoma Supreme Court, with other merit issues to be subsequently considered. The interest of the individual Justices in a Capitol Improvement Bond Issue, including bonds for new judicial facilities, is too speculative and insubstantial to constitute an interest in the outcome of this cause, involving the legality of that bond issue, to require disqualification of any or all of the Justices. Commonwealth of Northern Mariana Islands v. Kaipat, 94 F.3d 574 (9th Cir.1996).
¶ 2 DONE BY THE ORDER OF THE SUPREME COURT IN CONFERENCE THIS 19th DAY OF April, 1999.
¶ 3 HARGRAVE, V.C.J., HODGES, LAVENDER, SIMMS, WILSON, KAUGER and WATT, JJ. concur.
¶ 4 OPALA, J. Concurs in result.
OPALA, J., with whom KAUGER, J., joins only insofar as the rule of necessity is invoked in Parts III and IV, concurring in result.
¶ 1 Challenged is the validity of bonds to be issued. Some of these will be used for renovation of the State Historical Building slated for occupation by the Supreme Court. Petitioners move that all the justices disqualify because they will benefit from having new quarters. I conclude that, although subject to recusal, the court's justices must nonetheless decline to step down by invoking the rule of necessity.
I
THE U.S. CONSTITUTION COMMANDS A NEUTRAL AND DETACHED JUDICIARY
¶ 2 Ever since Tumey v. Ohio,[1] a tribunal's impartiality has been a sine qua non element of due process within the meaning of the Fifth and Fourteenth Amendments.[2] Judges must be not only neutral but also detached. These prerequisites preserve both the reality and appearance of fairness.[3] Lack of financial interest in the outcome of a case is not the sole indication of a court's fitness. Judges must also be free from an intellectual or emotional commitment that would indicate a predilection for or against a given resolution of the controversy at hand.[4]
II
DISPASSIONATENESS IS AN INDISPENSABLE PREREQUISITE FOR A DETACHED PROCESS OF ADJUDICATION
If one's economic interest were the sole test of a judge's neutrality and detachment, I would accede to the court's characterization of the justices' interest in this case as, at best, de minimis, speculative, and remote. What the analysis in today's order plainly disregards is that a tribunal's dispassionateness constitutes a sine qua non component of the fundamental law's standard of fairness in adjudication.[5] In order to administer judicial process without the taint of prejudice,[6] a *217 judge must "think dispassionately and submerge private feeling on every aspect of a case."[7]
¶ 4 The U.S. Constitution's due process gauge of impartiality for a tribunal's adjudicative fitness is encapsulated in the eloquence of the text that follows:
But our system of law has always endeavored to prevent even the probability of unfairness. To this end no man can be a judge in his own case and no man is permitted to try cases where he has an interest in the outcome. That interest cannot be defined with precision. Circumstances and relationships must be considered. This Court has said, however, that `Every procedure which would offer a possible temptation to the average man as a judge * * * not to hold the balance nice, clear, and true . . . denies the latter due process of law.' Such a stringent rule may sometimes bar trial by judges who have no actual bias and who would do their very best to weigh the scales of justice equally between contending parties. But to perform its high function in the best way `justice must satisfy the appearance of justice.'[8]
¶ 5 No less rigid is the standard-of-fairness test required for judicial officers by the commands of Article 2, section 6 of the Oklahoma Constitution:[9]
Every litigant is entitled to nothing less than the cold neutrality of an impartial judge.[10]
It is the duty of courts to scrupulously guard our constitutional rights to a speedy trial without prejudice, and a judge should refrain from trying to exercise jurisdiction in any matter where his qualification to so do is seriously brought in question. The exercise of any other policy tends to discredit the judiciary and shadow the administration of justice.[11]
¶ 6 The justices have not been challenged in this case for having a personal financial interest in the approval of the proposed bonds. The court admittedly has no known identification with, or involvement in, the business aspects of the transaction to be approved. Rather, the interposed challenge is to each of the individual justice's detachment. It is rested on our lack of dispassionateness alleged to stem from the court's stake in its opportunity to benefit from upgraded judicial facilities.
¶ 7 I cannot deem myself dispassionate when the outcome of the case affects my cherished status symbol the chambers in which my work is performed. Accommodations are a very important part of one's status in society. In contemporary American culture a private bathroom in one's executive suite of elegantly appointed offices is a symbol as well as a mark of achievement on the corporate ladder. I will not deny that this corporate culture has permeated the walls and corridors of the judiciary. In short, I cannot ignore my "stake" in the outcome of this case. To do otherwise would be to throw candor to the winds and to counteroffer a mere pretense that the lure of elegantly appointed chambers, each with a private bathroom, counts for absolutely nothing when weighed against my self-advanced profession of virginal detachment.[12]
*218 ¶ 8 The prospect of a sure gain, however much misperceived as something that is one's due, will invite a preference in any set of competing alternatives. This behavioral pattern is driven by human instinct. To proclaim its eradication by a professionally cultivated taste for (or habit of) voluntary suppression, or to rest the case against recusal on a categorical self-denial, will not bring honor to, or respect for, those who are in the service of judging. Public confidence in judicial impartiality has to be anchored in a faith-inspiring pedestal of much greater solidity. Not even the mighty pen of my colleague writing today in unqualified support for the court's order can convincingly repeal man's nature by his ipse dixit.
III
EN BANC RECUSAL OF THE JUSTICES WOULD OPEN THE DOOR FOR A GUBERNATORIAL APPOINTMENT OF SUCCESSORS
¶ 9 If a justice of the Oklahoma Supreme Court disqualifies from participation in a case, the Chief Justice assigns a state judicial officer to act in the place of the recused incumbent.[13]Upon recusal of all the justices, it is the duty of the Governor to appoint qualified members of the state bar to fill the vacant seats as "special justices".[14]
¶ 10 All of the justices have been challenged here for the same reason. Upon their recusal the Governor, though a litigant[15] in this cause, would have statutory authority to exercise his power of appointment. The persons so appointed are likely to be challenged as having received title from one who was not fit to confer it. Although the Governor does not necessarily have to be neutral, we cannot allow the judicial process to sink below its constitutional minimum by inviting the Chief Executive to, in effect, select his own court. It is a venerable common law adage that no litigant can appoint his own judges.[16]
IV
THE RULE OF NECESSITY COMMANDS THAT THE JUSTICES NOT RELINQUISH THEIR POSTS
¶ 11 The "rule of necessity," a well-established common-law principle, requires a judge to remain in a case, regardless of the judge's interest in the outcome, if the sole power to decide the controversy resides in him.[17] Where, as here, there exists no constitutionally credible provision for post-recusal filling of vacant seats, the justices have a duty to decide the controversy notwithstanding their imputed lack of impartiality.[18]
¶ 12 The rule of necessity governs this case not because there is no replacement mechanism but because the exercise of that mechanism,[19] controlled by one who is a party to the lawsuit, would be clouded by grave fundamental-law infirmity. Even if the Governor were to defeat a challenge to his appointment power, the law could not sanction his functioning in this case in a dual capacity as both litigant and judge.[20] The appointment *219 power of the Chief Justice[21] would likewise be tainted as all justices are challenged as having the same interest in the litigation. We must hence remain on the bench to prevent that vacuum which would be filled by persons with a constitutionally clouded status.
V
SUMMARY
¶ 13 It is my firm view that I do have a stake in the outcome of this case and am hence subject to the petitioner's quest for disqualification. Recusal of all justices would precipitate the Governor's appointment of pro tempore justices to hear the Chief Executive's own cause. My recusal would allow the Chief Justice to choose my replacement. He, like the Governor, would be disqualified to select my successor. By the law's clear command of the rule of necessity, all the justices must decline to relinquish their seats and be available to decide whether the bonds should be approved or the challenge to their validity sustained.
SIMMS, J., CONCURRING:
¶ 1 I most respectfully disagree with my colleague, Justice Opala, when he opines that each and every Justice on this Court is disqualified in this bond case simply because of the potential for improved chambers if and when these bonds are marketed, and the funds from the bond sale for a new and improved courts building become an actuality. I dare say my colleague speaks only for himself and not for the other members of this Court in his thoughts about the desirability and importance of a private bathroom. The grounds for disqualification urged by Justice Opala are more imagined than real, for it is my observation that Justice Opala is the only member of this Court who is passionate about having a bathroom in his chambers.
¶ 2 There is nothing new or novel about a judge or justice having private bathroom facilities. Indeed, when the Tulsa County Courthouse was dedicated in about 1954, that courthouse was designed with private bathroom facilities for each judge's chambers. A visit to many of the older courthouses in Oklahoma will reveal the judge has access to private facilities.
¶ 3 This Justice, due to the passage of time between planning and occupancy of a new court building, will never occupy the new or remodeled building, and therefore has no thoughts of sugar plums dancing in his head. Even casual study of the current court shows this observation applies to other Justices as well.
¶ 4 Although I do not believe Fent has established any ground for the disqualification of any of the Justices or any Justice of this Court, I agree with my brother Opala, that if, arguendo, this Court were disqualified, the Rule of Necessity would come into focus. Certainly, the Governor could not name the court in a case in which he is a litigant. There is no other statutory or constitutional authority existing by which any substitute tribunal could be named.
¶ 5 I am authorized to state that Justice Kauger and Justice Watt join with the views expressed herein
NOTES
[1] We note that an individual, Edwin Kessler has filed an entry of appearance in this matter on behalf of himself and an organization named Common Cause Oklahoma of which Mr. Kessler is State Chair. Mr. Kessler also filed a brief in this matter on May 26, 1999, wherein, like Jerry R. Fent and Margaret B. Fent, the two taxpayer petitioners that initiated this proceeding, he sets forth his arguments in opposition to the bond issues involved here, apparently on behalf of himself and the organization. In essence, the arguments of Mr. Kessler are substantially the same as those made by the two taxpayer petitioners. Further, at a hearing held in this matter on May 28, 1999 before a Referee of this Court, an individual by the name of Marjorie Greer, purportedly representing the Norman League of Women Voters, as its co-chair, appeared to protest the proposed bond issues. Ms. Greer has not filed any substantive briefs in this matter. At the May 28th hearing she orally stated her support for the brief filed by Mr. Kessler.
[2] OKLA. CONST. art. 10, § 23 provides in relevant part:
The state shall never create or authorize the creation of any debt or obligation, or fund or pay any deficit, against the state, or any department, institution or agency thereof, regardless of its form or the source of money from which it is to be paid, except as may be provided in this section and in Sections 24 and 25 of Article X of the Constitution of the State of Oklahoma.
[3] OKLA. CONST. art. 10, § 24 provides in relevant part:
In addition to the above limited power to contract debts, the State may contract debts to repel invasion, suppress insurrection or to defend the State in war . . . .
[4] OKLA. CONST. art. 10, § 25 provides in relevant part:
Except the debts specified in sections twenty-three and twenty-four of this article, no debts shall be hereafter contracted by or on behalf of this State, unless such debt shall be authorized by law for some work or object, to be distinctly specified therein; and such law shall impose and provide for the collection of a direct annual tax to pay, and sufficient to pay, the interest on such debt as it falls due, and also to pay and discharge the principal of such debt within twenty-five years from the time of the contracting thereof. No such law shall take effect until it shall, at a general election, have been submitted to the people and have received a majority of all the votes cast for and against it at such election. . . . .
[5] 73 O.S. Supp.1998, § 168.3 provides in full:
A. The Oklahoma Capitol Improvement Authority may acquire land owned by the Board of Trustees of the Oklahoma School of Science and Mathematics. The Oklahoma Capitol Improvement Authority may provide for the funding, construction and maintenance of a building or buildings for use by the Board of Trustees of the Oklahoma School of Science and Mathematics for the operation of the Oklahoma School of Science and Mathematics, and shall hold title to the facilities until such time as the indebtedness created pursuant to this section shall be retired or defeased. Upon the retirement of the indebtedness created pursuant to this section, the title to the land and improvements thereon shall be transferred from the Oklahoma Capitol Improvement Authority to the Board of Trustees of the Oklahoma School of Science and Mathematics.
B. For the purpose of paying the costs of the project authorized in subsection A of this section, the Authority is authorized to borrow monies on the credit of the income and revenues to be derived from such project and, in anticipation of the collection of such income and revenues, to issue negotiable or competitive bonds not to exceed the sum of Six Million Dollars ($6,000,000.00) as may be necessary for such purpose as determined by the Authority. The Oklahoma School of Science and Mathematics may not be moved from the building or buildings constructed pursuant to subsection A of this section until all such indebtedness is retired, and shall be required to lease the building or buildings so constructed subject to receiving an annual appropriation for that purpose. It is the intent of the Legislature to appropriate to the Oklahoma School of Science and Mathematics sufficient monies to make lease payments to the Authority for purposes of retiring the debt created pursuant to this section.
C. The bonds provided for in subsection B of this section shall not be issued until such time as the Board of Trustees of the Oklahoma School of Science and Mathematics has met the matching requirement as provided for in subsection G of this section or until a bank that is chartered in this state notifies the Authority, the Governor, the Speaker of the House of Representatives and the President Pro Tempore of the Senate that there exists an irrevocable restricted letter of credit for outstanding pledges or cash on deposit or a combination of both in the amount of Six Million Dollars ($6,000,000.00) for the purpose specified in subsection A of this section. Such notification must occur no later than July 1, 1998. In the alternative, the Authority may issue such bonds in series of no less than One Million Dollars ($1,000,000.00) each. In order to issue the first series of bonds, a bank, as described above, shall certify to the Authority and the above-referenced officers that there exist irrevocable letters of credit for outstanding pledges or cash on deposit or a combination of both in an amount equal to the amount of the first series. In order to issue any subsequent series of bonds, a bank, as described above, shall certify to the Authority and the above-referenced officers that there exist irrevocable letters of credit for outstanding pledges or cash on deposit or a combination of both in amounts equal to the amount of each subsequent series. Any irrevocable letter of credit required by this subsection shall be issued by a bank chartered in this state and insured by the Federal Deposit Insurance Corporation to the maximum limit available.
D. The proceeds of any bonds issued pursuant to this section and any other monies expended by the Board of Trustees for construction or improvements shall be expended for facilities, which shall include design fees for each such project. The first phase of any campus construction or improvements shall be limited to student housing, a dining facility, library, physical education and student activity facilities, and security needs including but not limited to fencing.
E. All interest earned on any reserve funds created by such bonds held by the State Treasurer, as collected, shall be paid into the General Revenue Fund.
F. Insofar as they are not in conflict with the provisions of this section, the provisions of Section 151 et seq. of Title 73 of the Oklahoma Statutes shall apply to this section.
G. Except as otherwise provided in this subsection, any private, public or nonstate monies pledged or deposited in accordance with this section for the purpose of construction of the campus of the Oklahoma School of Science and Mathematics shall be matched not to exceed Six Million Dollars ($6,000,000.00) by the state as follows:
State Nonstate Year of Contribution
60% 40% July 1, 1993-June 30, 1995
50% 50% July 1, 1995-June 30, 1998
40% 60% July 1, 1998-June 30, 1999
No federal funds shall be used for matching purposes pursuant to this subsection.
We note that the 47th Oklahoma Legislature amended § 168.3 by Senate Bill 172, § 2 (signed by the Governor on June 8, 1999), but not in a way material to our disposition of this matter. Essentially, the amendments increased to eight million five hundred thousand dollars the amount of six million dollars specified in § 168.3(B), (C) and (G), and changed the 40%-60% State/Nonstate matching fund provision for July 1, 1998 to June 30, 1999 found in § 168.3(G) to 50%-50% State/Nonstate for July 1, 1998 to June 30, 2000.
[6] 73 O.S. Supp.1998, § 301 provides in full:
A. The Oklahoma Capitol Improvement Authority is authorized to acquire real property, together with improvements located thereon, and personal property, to construct buildings and other improvements to real property and to provide funding for repairs, refurbishments and improvements to real and personal property and for funding for the following capital projects in the following amounts:
1. Capital projects at institutions of higher education which are part of The Oklahoma State System of Higher Education in a total amount not to exceed Forty-five Million Dollars ($45,000,000.00) with debt retirement payments to be made by the Oklahoma State Regents for Higher Education;
2. Construction of a History Center for the Oklahoma Historical Society in a total amount not to exceed Thirty-two Million Dollars ($32,000,000.00) with debt retirement payments to be made by the Oklahoma Historical Society;
3. Renovation of the Wiley Post Historical Building for occupancy by appellate courts in a total amount not to exceed Ten Million Dollars ($10,000,000.00) with debt retirement payments to be made by the Oklahoma Supreme Court;
4. Land acquisition, demolition, landscaping, environmental remediation and other costs associated with the Lincoln Boulevard Renaissance Project in a total amount not to exceed Thirteen Million Eight Hundred Thousand Dollars ($13,800,000.00) with debt retirement payments to be made by the Department of Central Services;
5. Construction of a new building for the J.D. McCarty Center for Children with Developmental Disabilities in a total amount not to exceed Ten Million Three Hundred Thousand Dollars ($10,300,000.00) with debt retirement payments to be made by the J.D. McCarty Center for Children with Developmental Disabilities;
6. Funding for capital costs of a Technology Incubator Program for the University Hospitals Authority in a total amount not to exceed Two Million Dollars ($2,000,000.00) with debt retirement payments to be made by the University Hospitals Authority;
7. Funding for capital costs for the Native American Cultural and Educational Authority of Oklahoma in a total amount not to exceed Five Million Dollars($5,000,000.00) with debt retirement payments to be made by the Native American Cultural and Educational Authority of Oklahoma;
8. Funding for capital costs for systemwide equipment for the Oklahoma Department of Vocational and Technical Education in a total amount not to exceed Five Million Dollars ($5,000,000.00) with debt retirement payments to be made by the Oklahoma Department of Vocational and Technical Education;
9. Capital projects for the Oklahoma School for the Deaf in a total amount not to exceed Six Million Seven Hundred Fifty Thousand Dollars ($6,750,000.00) with debt retirement payments to be made by the State Department of Rehabilitation Services;
10. Capital projects for the Oklahoma School for the Blind in a total amount not to exceed Six Million Seven Hundred Fifty Thousand Dollars ($6,750,000.00) with debt retirement payments to be made by the State Department of Rehabilitation Services;
11. Construction of a new Veterans Center in Lawton, Oklahoma, in a total amount not to exceed Twelve Million Dollars ($12,000,000.00) with debt retirement payments to be made by the Oklahoma Department of Veterans Affairs;
12. Capital costs for financial management information systems in a total amount not to exceed One Million Dollars ($1,000,000.00) with debt retirement payments to be made by the Office of State Finance;
13. Funding for the purchase of computer hardware and software for the Central Purchasing Division of the Department of Central Services in a total amount not to exceed Two Million Dollars ($2,000,000.00) with debt retirement payments to be made by the Department of Central Services;
14. Funding for implementation of the Boll Weevil Eradication Act in a total amount not to exceed Three Million Dollars ($3,000,000.00) with debt retirement payments to be made by the State Department of Agriculture;
15. Funding for construction and other capital costs at Quartz Mountain Lodge and Arts and Conference Center in a total amount not to exceed Three Million Five Hundred Thousand Dollars ($3,500,000.00) with debt retirement payments to be made by the Oklahoma Tourism and Recreation Department; and
16. Such other capital projects as may be specifically authorized by the Oklahoma Legislature to be funded by the obligations authorized herein.
The Authority may hold title to the real and personal property and improvements until such time as any obligations issued for this purpose are retired or defeated and may lease the real property and improvements to the agencies indicated herein. Upon final redemption or defeasance of the obligations created pursuant to this section, title to the real and personal property and improvements shall be transferred from the Oklahoma Capitol Improvement Authority, to the agencies indicated herein.
B. For the purpose of paying the costs for acquisition and construction of the real property and improvements and personal property and making the repairs, refurbishments, and improvements to real and personal property, and providing funding for the projects authorized in subsection A of this section, and for the purpose authorized in subsection C of this section, the Authority is hereby authorized to borrow monies on the credit of the income and revenues to be derived from the leasing of such real and personal property and improvements and, in anticipation of the collection of such income and revenues, to issue negotiable obligations in a total amount not to exceed Three Hundred Twenty Million Dollars ($320,000,000.00) whether issued in one or more series. The Department of Central Services is authorized and directed to expend funds from the Capital Improvement Revolving Fund in amounts sufficient to make required payments pursuant to such obligations during the fiscal year ending June 30, 1999. For subsequent fiscal years, it is the intent of the Legislature to appropriate to the indicated state agencies sufficient monies to make rental payments for the purposes of retiring the obligations created pursuant to this section. The costs for acquisition and construction of the real and personal property and improvements and repairs, refurbishments and funding for the projects authorized in subsection A of this section shall not exceed Three Hundred Fifteen Million Dollars ($315,000,000.00).
C. To the extent funds are available from the proceeds of the borrowing authorized by subsection B of this section, the Oklahoma Capitol Improvement Authority shall provide for the payment of professional fees and associated costs related to the projects authorized in subsection A of this section.
D. The Authority may issue obligations in one or more series and in conjunction with other issues of the Authority. The Authority is authorized to hire bond counsel, financial consultants, and such other professionals as it may deem necessary to provide for the efficient sale of the obligations and may utilize a portion of the proceeds of any borrowing to create such reserves as may be deemed necessary and to pay costs associated with the issuance and administration of such obligations.
E. The obligations authorized under this section may be sold at either competitive or negotiated sale, as determined by the Authority, and in such form and at such prices as may be authorized by the Authority. The Authority may enter into agreements with such credit enhancers and liquidity providers as may be determined necessary to efficiently market the obligations. The obligations may mature and have such provisions for redemption as shall be determined by the Authority, but in no event shall the final maturity of such obligations occur later than thirty (30) years from the first principal maturity date.
F. Any interest earnings on funds or accounts created for the purposes of this section may be utilized as partial payment of the annual debt service or for the purposes directed by the Authority.
G. The obligations issued under this section, the transfer thereof and the interest earned on such obligations, including any profit derived from the sale thereof, shall not be subject to taxation of any kind by the State of Oklahoma, or by any county, municipality or political subdivision therein.
H. The Authority may direct the investment of all monies in any funds or accounts created in connection with the offering of the obligations authorized under this section. Such investments shall be made in a manner consistent with the investment guidelines of the State Treasurer. The Authority may place additional restrictions on the investment of such monies if necessary to enhance the marketability of the obligations.
I. It is the intent of the Legislature to authorize specific capital projects in the 1st Session of the 47th Oklahoma Legislature to be funded by the negotiable obligations authorized in this section. Such capital projects shall not exceed One Hundred Fifty-six Million Nine Hundred Thousand Dollars ($156,900,000.00).
The 47th Oklahoma Legislature amended § 301 by Senate Bill 115 (signed by the Governor May 27, 1999) and House Bill 1571, § 39 (signed by the Governor June 10, 1999). The amendments are not material to our disposition.
[7] Taxpayer petitioners also argue that the purchase of bond insurance by the Oklahoma Capitol Improvement Authority (OCIA) from a bond insurance company in relation to the bond proposals at issue here would be unconstitutional as violative of our constitutional balanced budget provisions, would be void because no "insurable interest" exists and might constitute a prohibited gift by the State to purchasers of the bonds in violation of OKLA. CONST. art. 10, § 15. Although this Court has not been provided with any bond insurance policy that will be purchased by OCIA in relation to the two bond proposals involved here, both of the OCIA bond proposal resolutions adopted on December 18, 1998 indicate that bond insurance with respect to the principal of and interest on the bonds will be purchased from a bond insurance company, if the interest cost savings on all or a portion of the bonds exceed the cost of such insurance. Apparently, under such insurance, the insurer would agree to pay the principal and interest to any bondholder should OCIA default on any payment thereof because of a failure of any succeeding Legislature to appropriate sufficient funds to retire part or all of the payments due under any bonds sold. We do not believe, if purchased, such insurance would constitute a prohibited gift. As noted, the two bond proposal resolutions provide insurance will only be purchased if its cost is less than the interest cost savings on all or a portion of the bonds. Thus, OCIA, the State and the public will reap an economic benefit from the purchase. In such a situation, the purchase of insurance cannot be considered a prohibited gift. See In The Matter of The Petition of University Hospitals Authority, 1997 OK 162, 953 P.2d 314, 320-321. We also believe both the State and the bondholders have an insurable interest subject to insurance protection. The State has a substantial economic interest in being better able to market bonds which are insured, rather than ones which are not insured, and the State obviously has an economic interest in seeing to it that such bonds are faithfully retired. A substantial economic interest of the bondholders exists in the form of protecting the safety and integrity of the money they have loaned to OCIA and insuring it will be paid back. Finally, our constitutional balanced budget provisions would not be violated by OCIA's purchase of a bond insurance policy, so long as no term of the policy creates a binding future obligation upon the State, such as the State agreeing to reimburse the bond insurance company for payments made by it to some or all of the bondholders because of a default on the part of OCIA to pay the bondholders by virtue of a lack of legislative appropriations. See Dieck v. Unified School District of Antigo, 165 Wis.2d 458, 477 N.W.2d 613, 621-622 (1991).
[8] We note that our decision in Application of Oklahoma Capitol Improvement Authority, 1998 OK 25, 958 P.2d 759, cert. denied ___ U.S. ___, 119 S.Ct. 174, 142 L.Ed.2d 142 (1998) foreshadowed an understanding that statutes authorizing appropriation-risk or moral obligation bond measures like that at issue here are not revenue bills within the meaning of OKLA. CONST. art. 5, § 33. 958 P.2d at 762 fn. 5.
[9] We note that by this Court's Order filed in this matter on April 20, 1999, we previously denied the December 29, 1998 motion of petitioners for recusal and disqualification of all members of this Court. That order is to be published contemporaneously with this opinion.
[1] The Okla. Const. art. 5, § 33 provides:
"A. All bills for raising revenue shall originate in the House of Representatives. The Senate may propose amendments to revenue bills.
B. No revenue bill shall be passed during the five last days of the session.
C. Any revenue bill originating in the House of Representatives shall not become effective until it has been referred to the people of the state at the next general election held throughout the state and shall become effective and be in force when it has been approved by a majority of the votes cast on the measure at such election and not otherwise, except as otherwise provided in subsection D of this section.
D. Any revenue bill originating in the House of Representatives may become law without being submitted to a vote of the people of the state if such bill receives the approval of three-fourths (¾) of the membership of the House of Representatives and three-fourths (¾) of the membership of the Senate and is submitted to the Governor for appropriate action. Any such revenue bill shall not be subject to the emergency measure provision authorized in Section 58 of this Article and shall not become effective and be in force until ninety days after it has been approved by the Legislature, and acted on by the Governor."
[2] The Okla. Const. art. 10, § 23 provides in pertinent part:
"The state shall never create or authorize the creation of any debt or obligation, or fund or pay any deficit, against the state, or any department, institution or agency thereof, regardless of the form, or the source of money from which it is to be paid, except as may be provided in this section and in Sections 24 and 25 of Article X of the Constitution of the State of Oklahoma. . . ."
[3] The Okla. Const. art. 10, § 24 provides in pertinent part:
"In addition to the above limited power to contract debts, the State may contract debts to repel invasion, suppress insurrection or to defend the State in war . . ."
[4] The Okla. Const. art. 10, § 25 provides in pertinent part:
"Except the debts specified in sections twenty-three and twenty-four of this article, no debts shall be hereafter contracted by or on behalf of this State, unless such debt shall be authorized by law for some work or object, to be distinctly specified therein; and such law shall impose and provide for the collection of a direct annual tax to pay, and sufficient to pay, the interest on such debt as it falls due, and also to pay and discharge the principal of such debt within twenty-five years from the time of the contracting thereof. No such law shall take effect until it shall, at a general election, have been submitted to the people and have received a majority of all the votes cast for and against it at such election. . . ."
[5] See, ¶ 7, majority opinion. Subsection A(13) of 73 O.S. Supp.1998 § 301 provides for a maximum of $3 million for the implementation of the Boll Weevil Eradication Act with debt retirement payments to be made by the Department of Agriculture. However, this program provides an avenue for economic support through self-assessments on cotton growers. See, 2 O.S. Supp. 1997 §§ 3-50.9, 3-50.9a, 3-50.10 and 3-50.11.
[6] Title 73 O.S. Supp.1998, § 301, see majority opinion, note 8, supra.
[7] Michigan v. Long, 463 U.S. 1032, 1042, 103 S.Ct. 3469, 3476, 77 L.Ed.2d 1201, 1214 (1983).
[1] OKLA. CONST. art. 10, § 24 authorizes the State to contract debts to repel invasion, to suppress insurrection or to defend the State in war. No one argues the applicability of that provision in this case and it is obviously inapplicable to the statutes and bonds currently subject to review.
[2] See e.g. Baker v. Carter, 165 Okla. 116, 25 P.2d 747 (1933)(dormitory bonds to be retired from rents and fees paid by student users).
[1] The Oklahoma Constitution, art. 10, § 25 provides that "no debts shall be hereafter contracted by or on behalf of this State, unless such debt shall be authorized by law for some work or object," . . . and "(n)o such law shall take effect until it shall, at a general election, have been submitted to the people and have received a majority of all the votes cast for and against it at such election."
[2] Neither 73 O.S.Supp.1998, § 168.3, authorizing 6 million dollars in bonds for the Oklahoma School of Science and Mathematics, nor 73 O.S.Supp.1998, § 301, authorizing a total of 320 million dollars in bonds for a variety of state projects, have been submitted to a vote of the people. The Legislature has had nearly 8 years to submit the statute authorizing the 6 million dollar bond issue to a vote of the people. It was originally enacted by 1991 Okla. Sess. Laws, ch. 270, § 37, with a declared effective date of July 1, 1991. And, the Legislature could have submitted the statute authorizing the issuance of 320 million dollars of bonds to a vote of the people at our general election in 1998. That statute was originally enacted by 1998 Okla. Sess. Laws, ch. 372, § 1, with a declared effective date of September 1, 1998.
[1] 1998 OK 25, 958 P.2d 759, 779-82, cert. denied ___ U.S. ___, 119 S.Ct. 174, 142 L.Ed.2d 142 (1998).
[1] See Tumey v. Ohio, 273 U.S. 510, 532, 47 S.Ct. 437, 444, 71 L.Ed. 749 (1927).
[2] Chief Justice Taft, relying on the common law of England, recognized as a fundamental principle of due process that judicial officers be disqualified by their interest in a controversy to be decided. See id., 273 U.S. at 522-23, 47 S.Ct. at 441 (citing Dimes v. Grand Junction Canal, [111] H.L.C. 759); see also Concrete Pipe & Prods. of Cal., Inc. v. Construction Laborers Pension Trust for So. Cal., 508 U.S. 602, 617, 113 S.Ct. 2264, 2277, 124 L.Ed.2d 539 (1993); Aetna Life Ins. Co. v. Lavoie, 475 U.S. 813, 822, 106 S.Ct. 1580, 1585, 89 L.Ed.2d 823 (1986); Ward v. Village of Monroeville, 409 U.S. 57, 61-62, 93 S.Ct. 80, 84, 34 L.Ed.2d 267 (1972); Bartkus v. People of Illinois, 359 U.S. 121, 128, 79 S.Ct. 676, 680, 3 L.Ed.2d 684 (1959).
[3] See Marshall v. Jerrico, Inc. 446 U.S. 238, 242, 100 S.Ct. 1610, 1613, 64 L.Ed.2d 182; see also Ward v. Village of Monroeville, 409 U.S. 57, 61-62, 93 S.Ct. 80, 84, 34 L.Ed.2d 267 (1972).
[4] See Karl Georg Wurzel, Methods of Juridical Thinking in William R. Bishin & Christopher D. Stone, Law, Language & Ethics 883-84 (University Casebook Series, 1972).
[5] See Wurzel, supra note 4.
[6] See Okla. Const. Art. 2, § 6 which provides that "justice shall be administered without . . . prejudice."
[7] Public Utilities Commission v. Pollak, 343 U.S. 451, 466, 72 S.Ct. 813, 822, 96 L.Ed. 1068 (1952) (Frankfurter, J., expressly taking no part in the decision).
[8] In re Murchison, 349 U.S. 133, 136, 75 S.Ct. 623, 625, 99 L.Ed. 942 (1955) (citing Tumey v. Ohio, 273 U.S. 510, 532, 47 S.Ct. 437, 444, 71 L.Ed. 749 (1927) and Offutt v. United States, 348 U.S. 11, 14, 75 S.Ct. 11, 13, 99 L.Ed. 11 (1954)) (emphasis supplied and citations omitted).
[9] See supra note 6 for the pertinent provisions.
[10] State v. Sullivan, 207 Okl. 128, 248 P.2d 239, 244 (1952).
[11] Id. (emphasis supplied).
[12] See id., where it is stated:
To force the petitioner to trial in face of the fear that the suggestions for disqualification warrant[s] would be to impose on him a condition contrary to every principle devised for the administration of justice under our jurisprudence. There may in reality be little basis for his fear but if it's there, the renunciation of the trial judge won't efface it.
(emphasis supplied).
[13] See 20 O.S.1991 Ch. 1, App. 2, Rule 9(b); Okla. Const. Art. 7, §§ 6, 8(i).
[14] See 20 O.S.1991 Ch. 1, App. 2, Rule 9(c); 20 O.S.1991 § 1402.
[15] The Governor, as the Chairman of the Oklahoma Capitol Improvement Authority, is a litigant in this case.
[16] Nemo Potest Esse Simul Actor et Judex. No one can be at once a suitor and a judge. Broom, Max. 117. Nemo Agit in Seipsum. A man cannot be a judge and a party in the same case. Broom, Max. 216n. Nemo debet esse judex in propia causa. No man ought to be a judge in his own cause. See Black's Law Dictionary 935, 936 (5th ed.1979). Lord Campbell recognized that "it is of the last importance that the maxim that no man is to be a judge in his own cause should be held sacred. And that is not to be confined to a cause in which he is a party, but applies [also] to a cause in which he has an interest." Dimes v. Grand Junction Canal, 111 H.L.C. 759, 793 (1852).
[17] See United States v. Will, 449 U.S. 200, 213, 101 S.Ct. 471, 480, 66 L.Ed.2d 392 (1980); Southwestern Bell Telephone Co. v. Oklahoma Corp. Comm'n, 1994 OK 38, ¶ 24 n. 87, 873 P.2d 1001, 1023 n. 87 (1994) (Opala, J., dissenting).
[18] See Will, 449 U.S. at 214, 101 S.Ct. at 480.
[19] See supra note 14.
[20] See supra note 15.
[21] See supra note 13.
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887 F.2d 1081Unpublished Disposition
NOTICE: Fourth Circuit I.O.P. 36.6 states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Fourth Circuit.UNITED STATES of America, Plaintiff-Appellee,v.Norman HENSON, aka Hun Bun, Defendant-Appellant.
No. 88-5584.
United States Court of Appeals, Fourth Circuit.
Submitted: July 6, 1989.Decided: Sept. 29, 1989.Rehearing and Rehearing In Banc Denied Nov. 8, 1989.
Howard L. Cardin, Mark L. Gitomer, Cardin & Gitomer, P.A., for appellant.
Breckenridge L. Willcox, United States Attorney, Katharine J. Armentrout, Assistant United States Attorney, Quincie Hopkins, Third Year Law Student/Law Clerk, for appellee.
Before PHILLIPS and MURNAGHAN, Circuit Judges, and BUTZNER, Senior Circuit Judge.
PER CURIAM:
1
Defendant was convicted after a jury trial in April 1979 of conspiracy to distribute or to possess with intent to distribute narcotics in violation of 21 U.S.C. Sec. 841(a)(1). See 21 U.S.C. Sec. 846. He failed to appear for sentencing, and a bench warrant was issued in July 1979. The bench warrant was executed in March 1988 and defendant returned for sentencing; in May 1988 the district court sentenced him to twenty years imprisonment. Defendant now appeals errors allegedly committed during the 1979 trial. We affirm.
2
Defendant, identified as a supplier of "large quantities of heroin and cocaine," was charged along with sixteen others in a thirty-five count drug conspiracy indictment. Trial commenced and voir dire was conducted. The voir dire was not transcribed, but a transcript of the proceedings immediately following indicates that one of the defense attorneys objected to the government's use of peremptory challenges to strike two blacks from the panel. The court rejected the challenge to the use of peremptory strikes, noting that it did not find any "racial overtones" in the use of strikes. Joint Appendix at 101.
3
Defendant's attorney also moved for severance before trial, a motion he repeated several times during the trial. Defendant argued he would be prejudiced by the presentation of evidence admissible only against other defendants, especially since defendant was named in only the one conspiracy count. On each occasion, the court rejected the motion to sever.
4
The evidence presented against defendant during the trial included testimony from one witness and several wiretapped conversations. A co-conspirator, testifying pursuant to a plea agreement, testified that she traveled to New York with the principal defendant, Walter Webster, who obtained a large quantity of narcotics. While Webster was sifting and dividing the drugs, defendant arrived. Webster was upset because defendant had not brought any "glassine bags," ordinary plastic sandwich bags which can be used to package drugs, and they would have to go to Brooklyn, where defendant lived, to get the bags. The principal defendant traveled to defendant's apartment early the next morning and obtained the bags. Id. at 173-79.
5
Three wiretapped telephone conversations were introduced that also provided evidence against defendant. In a conversation between two co-defendants, defendant was identified as a source of "iron," which testimony indicated was a term for quinine, a cutting agent for drugs. Id. at 271, 128. In a second conversation, defendant told principal defendant Webster that he had some heroin ("Rocky"). A government witness interpreting the call testified that defendant indicated he was going to bring the heroin over for the principal defendant to sample. Id. at 210. In the third conversation, Webster asks defendant whether he has any cocaine ("lady"); defendant indicates that he does, but is having difficulty reaching the principal defendant. Id. at 285-86. Other phone calls indicate that Webster initially had difficulty contacting defendant, and after they made contact document defendant's continuing difficulty in meeting with the principal defendant.
6
One other significant phone call by Webster, which was ultimately ruled admissible only against the principal defendant, seemed to link defendant with the conspiracy.
7
Yeah I made a lot, a lot of money with Bun [defendant] with this, you know.
8
* * *
9
* * *
10
I made a lot of money with ah, ah ........what I was doing. Was ah, ah let him get some money, I was ah, letting him having it like ah, four hundred a quarter, sixteen hundred an ounce right ... so he make four hundred dollars ... you know.
11
Id. at 281. Over defendant's objection, the conversation was conditionally admitted as "in furtherance of the conspiracy." While defendant requested a limiting instruction when the tape was played, the district court instead gave a strong limiting instruction to the jury, referring specifically to the conversation at issue, at the close of the case when it ruled that the conversation could be admitted only against principal defendant Webster. Id. at 268-69.
12
* Defendant first argues that Batson v. Kentucky, 476 U.S. 79 (1986), requires this court to remand the case to the district court for a hearing on defendant's challenge to the government's use of its peremptory strikes. In Batson, the Supreme Court held that once a defendant makes out a prima facie case of discrimination in the use of peremptory strikes, the burden shifts to the government to present racially neutral explanations for the strikes. Id. at 97. The Court considered the reach of Batson in Allen v. Hardy, 478 U.S. 255 (1986) (per curiam), and Griffith v. Kentucky, --- U.S. ----, 107 S.Ct. 708 (1987). In Allen, the Court held that Batson would not be applied retroactively to cases pending on collateral review when Batson was decided, 478 U.S. at 261; in Griffith, the Court held that Batson should be applied retroactively to cases pending on direct review or not yet final when Batson was decided, 107 S.Ct. at 716. The Court defined as final a case "in which a judgment of conviction has been rendered, the availability of appeal exhausted, and the time for a petition for certiorari elapsed or a petition for certiorari finally denied." Griffith, 107 S.Ct. at 712 n. 6. The Griffith Court reasoned that new rules for the conduct of criminal cases should be applied retroactively because the "integrity of judicial review" requires that a new rule be applied to all similar cases pending on direct review, and because "selective application of new rules [would] violate[ ] the principle of treating similarly situated defendants the same." Id. at 713.
13
While neither case addresses the question whether Batson should apply retroactively to benefit a defendant whose case was not "final" when Batson was decided only because he fled from justice, the reasoning in both Griffith and Allen compels the conclusion that Batson should not apply. Defendant correctly points out that his case is not "final" as defined by the Court, and a literal reading of Griffith brings defendant within its scope. See Reply Br. at 4. Defendant, however, was convicted seven years before Batson was decided, and he was "similarly situated" with his co-defendants, whose convictions were "final" by 1982. See United States v. Webster, 639 F.2d 174 (4th Cir.1981), modified in part, 669 F.2d 185 (4th Cir.1982). Defendant suffers no " 'actual inequity,' " compared to his similarly situated co-defendants, see Griffith, 107 S.Ct. at 714 (quoting United States v. Johnson, 457 U.S. 537, 555 n. 16 (1982)), from being denied the benefit of Batson; in fact, it would be unreasonable that the " 'lucky individual,' " see id. at 716 (quoting Hankerson v. North Carolina, 432 U.S. 233, 247 (1977) (Powell, J., concurring in the judgment)), who benefits from the new rule should be the one who fled before sentencing. In addition, the Allen Court recognized that retroactive application of Batson to cases on collateral review would "seriously disrupt the administration of justice" by requiring hearings and possibly new trials years after a conviction became final. 478 U.S. at 260. The same kind of disruption would be engendered by retroactive application to defendant.
II
14
Defendant's next contention, that the district court erred in failing to grant the motion to sever, is without merit. Under Fed.R.Crim.P. 14, the court may grant a severance if it appears that a defendant is "prejudiced" by a joinder of offenses or of defendants. Barring "special circumstances," the general rule is that defendants indicted together should be tried together. United States v. Bruqman, 655 F.2d 540, 542 (4th Cir.1981). The district court's decision to grant or deny a motion for severance will be overturned only for a clear abuse of discretion. Person v. Miller, 854 F.2d 656, 665 (4th Cir.1988). "Such an abuse of discretion will be found only where the trial court's decision to deny a severance 'deprives the defendant of a fair trial and results in a miscarriage of justice.' " Id. (quoting United States v. Becker, 585 F.2d 703, 706 (4th Cir.1978)).
15
The district court did not abuse its discretion in refusing to sever defendant from the case. The only "prejudice" defendant claims to have suffered allegedly arose from the admission of defendant Webster's phone conversation, in which Webster indicated that he had made money with "Bun" (defendant). See Appellant's Br. at 4-6; Reply Br. at 6. While the district court conditionally admitted the tape of that conversation, the court later gave a strong limiting instruction that specifically referred to the conversation in question. Any prejudice to the defendant was minimized by the limiting instruction. See Fed.R.Evid. 105; United States v. Peterson, 524 F.2d 167, 182 (4th Cir.1975). The court did not abuse its discretion in refusing to grant a severance where a limiting instruction could minimize any prejudice. See also Webster, 639 F.2d at 189 (no error found in district court's refusal to grant severance to several of defendant's co-conspirators).
III
16
Defendant's final contention, that there was insufficient evidence to convict him on the conspiracy charge, also fails. The conspiracy to distribute charge requires the government to prove that the defendant "knew the conspiracy's purpose and took some action indicating [his] participation." United States v. Crockett, 813 F.2d 1310, 1316 (4th Cir.1987). These elements can be shown by circumstantial evidence, such as the defendant's "relationship with other members of the conspiracy, the length of this association, his attitude, conduct, and the nature of the conspiracy." United States v. Collazo, 732 F.2d 1200, 1205 (4th Cir.1984). Even uncorroborated testimony of an accomplice may be sufficient to sustain a conspiracy conviction. See United States v. Manbeck, 744 F.2d 360, 392 (4th Cir.1984). Ultimately, the jury's verdict must be upheld if there is substantial evidence, taking the evidence in the light most favorable to the government, to support the finding of guilt. United States v. Jackson, 863 F.2d 1168, 1173 (4th Cir.1989).
17
Substantial evidence supports defendant's conspiracy conviction. The wiretapped conversations indicate that defendant had, or that the principal defendant Webster thought he might have, narcotics available for delivery. In addition to the taped conversations, direct testimony of a co-conspirator, if believed by the jury, would establish defendant as a supplier of packaging used in the drug trade. This evidence, viewed in the light most favorable to the government, is sufficient to establish the elements of knowledge and participation necessary for conviction. Cf. Webster, 639 F.2d at 187-89 & n. 8 (conspiracy conviction of one co-defendant overturned where evidence sufficient to convict only of possession or purchase; evidence of actual transactions as well as wiretapped conversations often necessary for conspiracy conviction).
18
For the foregoing reasons, the judgment entered by the district court is affirmed. We dispense with oral argument because the facts and legal contentions are adequately presented in the materials before the court and argument would not aid the decisional process.
19
AFFIRMED.
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421 F.Supp.2d 1038 (2006)
Robert PICHEY, et al., Plaintiff,
v.
AMERITECH INTERACTIVE MEDIA SERVICES, INC., et al., Defendants.
No. 5:05-CV-102.
United States District Court, W.D. Michigan, Southern Division.
February 8, 2006.
*1039 *1040 *1041 Michael H. Perry, Fraser Trebilcock Davis & Dunlap PC, Lansing, MI, for Plaintiff.
Ted W. Stroud, Oade Stroud & Kleiman PC, Allen Louis Lanstra, Jr., Dickinson Wright, PLLC, Lansing, MI, for Defendants.
OPINION
ROBERT HOLMES BELL, Chief Judge.
This is a breach of contract action originally filed in the Circuit Court for Ingham County, Michigan. The action was removed to this Court on July 8, 2005, after the filing of the second-amended complaint. On September 6, 2005, Defendant Ameritech Interactive Media Services, Inc. ("AIMS") and Defendant Ameritech Interactive Media, Inc. ("AIM") both filed motions for summary judgment (docket ## 11, 13). For the reasons that follow, Defendants' motions for summary judgment are granted.
I.
In approximately January 1998, Plaintiffs Robert Pichey and Patricia Pichey began doing business as Victorian Gallery, a specialty furniture retailer. According to Patricia Pichey, while Plaintiffs did a small amount of local business, they intended that most of their sales would be generated through internet advertising and internet contact with their customers and prospective customers. Plaintiffs spoke several times with Shawn McCracken, an interactive media specialist representing both AIMS and AIM. On or about February 19, 1998, Patricia Pichey, as owner of Victorian Gallery, entered into certain agreements with AIMS and AIM for the provision of internet advertising services relating to the design, registration and hosting of a custom internet web site. A total of three agreements were signed, two with AIMS and one with AIM. One contract with AIMS (AIMS Sales Agreement No. 002451) was for the domain name registration fee, to be provided at a cost of $250, for which Victorian Gallery was to receive $150 credit toward the price of the custom web site development. The second contract with AIMS (AIMS Sales Agreement No. 007203) was for a fee text advertisement and a standard link. The contract stated that the cost for the services was included at no extra charge in the cost of the custom site design purchased in Contract No. 000033. The third *1042 contract was with AIM (AIM Sales Agreement No. 000033). That agreement stated that AIM would provide a custom web site. In the special instructions, the AIM agreement referenced both of the AIMS contract numbers and showed a total charge of $1,350 for the AIM services, which reflected a credit of $150 on the domain name registration agreement with AIMS.
Plaintiffs allege that the promotional materials they received from Ameritech Interactive Media made no distinctions between AIMS and AIM and that they believed they were contracting with a single entity, "Ameritech." In those promotional materials, the purchase of a custom web site included the following items: (1) virtual hosting; (2) registration on major Internet search engines; (3) a link from the purchaser's business listing in the Ameritech Internet Yellow Pages; (4) a web site symbol in the purchaser's business listing in the Ameritech Internet Yellow Pages; (5) quarterly detailed traffic reports on the number of visitors to the purchaser's site; and (6) full-service web site development. On another promotional page, "Ameritech" promised that any web site would include the following: (1) a home page; (2) a page detailing products or services; (3) a unique e-mail address and e-mail services; (4) a customer feedback form; (5) virtual hosting; (6) registration on major Internet search engines; (7) a link from the customer's Ameritech Internet Yellow Pages business listing; (8) a web site symbol next to the internet yellow pages listing; and (9) quarterly detailed traffic reports on the number of visitors to the site.
Plaintiffs allege that in late 1999, they were informed by their wholesale supplier that the supplier was concerned about the lack of sales on the part of Victorian Gallery and that the supplier had been unable to locate the Victorian Gallery web page, despite searching on major Internet search engines. On or about April 20, 2000, Patricia Pichey had a telephone conversation with Monica Watson of AIM. Watson purportedly admitted that the Victorian Gallery web site had never been registered with the major search engines. In a memorandum memorializing the conversation, Watson agreed that certain changes would be made to the web site, including the addition of a map, and that five specific site-related keywords would be submitted to five major Internet search engines: Lycos, Alta Vista, Excite, Infoseek, and Yahoo. In addition, on May 3, 2000, Watson confirmed that, pursuant to her conversation with Patricia Pichey, the hosting account for victoriangallery.com would be extended for 18 months, or until November 1, 2001.
Notwithstanding these representations, Plaintiffs contend that neither AIMS nor AIM registered the Victorian Gallery web site with any major Internet search engine. As a consequence of the failure to register, Plaintiffs allege damages exceeding $3,000,000 in the form of lost opportunity and exposure, out-of-pocket expenses, and lost profits.
II.
On a motion for summary judgment, a court must consider all pleadings, depositions, affidavits and admissions and draw all justifiable inferences in favor of the party opposing the motion. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). The court, however, "`need not accept as true legal conclusions or unwarranted factual inferences.'" Michigan Paytel Joint Venture v. City of Detroit, 287 F.3d 527, 533 (6th Cir.2002) (quoting Morgan v. Church's Fried Chicken, 829 F.2d 10, 12 (6th Cir.1987)). The party moving for summary judgment has the burden of pointing the court to the absence of evidence in support of some *1043 essential element of the opponent's case. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Street v. J.C. Bradford & Co., 886 F.2d 1472, 1479 (6th Cir.1989). Once the moving party has made such a showing, the burden is on the nonmoving party to demonstrate the existence of a genuine issue for trial. Id. Summary judgment is appropriate when the record reveals that there are no genuine issues as to any material fact in dispute and the moving party is entitled to judgment as a matter of law. FED. R. Civ. P. 56(c); Kocak v. Community Health Partners of Ohio, Inc., 400 F.3d 466, 468 (6th Cir.2005).
In order to prove that a triable issue exists, the nonmoving party must do more than rely upon allegations, but must come forward with specific facts in support of his or her claim. Celotex, 477 U.S. at 322, 106 S.Ct. 2548; Mulhall v. Ashcroft, 287 F.3d 543, 550 (6th Cir.2002). A party opposing a motion for summary judgment "may not merely recite the incantation, `credibility,' and have a trial in the hope that a jury may believe factually uncontested proof." Fogerty v. MGM Holdings Corp., Inc., 379 F.3d 348, 353 (6th Cir. 2004). After reviewing the whole record, the court must determine "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Booker v. Brown & Williamson Tobacco Co., Inc., 879 F.2d 1304, 1310 (6th Cir.1989) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). "[D]iscredited testimony is not [normally] considered a sufficient basis" for defeating the motion. Anderson, 477 U.S. at 256-57, 106 S.Ct. 2505 (quoting Bose Corp. v. Consumers Union of United States, Inc., 466 U.S. 485, 512, 104 S.Ct. 1949, 80 L.Ed.2d 502 (1984)). In addition, where the factual context makes a party's claim implausible, that party must come forward with more persuasive evidence demonstrating a genuine issue for trial. Celotex, 477 U.S. at 323-24, 106 S.Ct. 2548; Matsushita, 475 U.S. at 586-87, 106 S.Ct. 1348; Street, 886 F.2d at 1480. "A mere scintilla of evidence is insufficient; `there must be evidence on which a jury could reasonably find for the [non-movant].'" Daniels v. Woodside, 396 F.3d 730, 734 (6th Cir.2005) (quoting Anderson, 477 U.S. at 252, 106 S.Ct. 2505).
III.
In their separate motions for summary judgment, both Defendants argue that Plaintiffs' claims for damages in the form of lost opportunities, out-of-pocket expenses and lost profits are barred by the limited liability clause contained in the contracts signed by Plaintiffs. The clauses appear, with other provisions, on the reverse of each of the sales agreements:
AMERITECH'S LIABILITY. The amounts payable by Customer are not sufficient to warrant Ameritech assuming any risk of consequential, incidental or other special damages. From the nature of the services to be performed, it is impractical and extremely difficult to fix the actual damages which may result from the failure on the part of Ameritech to perform its obligations herein. UNLESS THE PARTIES NEGOTIATE A HIGHER LIMIT OF LIABILITY, IF AMERITECH SHOULD BE FOUND LIABLE FOR LOSS OR DAMAGE DUE TO A FAILURE ON THE PART OF AERITECH REGARDLESS WHETER THE CUSTOMER'S CLAIM IS BASED ON CONTRACT, TORT, STRICT LIABILITY OR OTHERWISE, THE LIABILITY SHALL BE LIMITED TO AN AMOUNT EQUAL TO THE CONTRACT PRICE OR [SIC] THE DISPUTED SERVICES, OR THAT SUM OF MONEY ACTUALLY *1044 PAID BY CUSTOMER TOWARD THE DISPUTED SERVICES, WHICHEVER SUM SHALL BE LESS, AS LIQUIDATED DAMAGES AND NOT AS A PENALTY, AND THIS LIABILITY SHALL BE EXCLUSIVE. IN NO EVENT SHALL AMERITECH BE LIABLE FOR ANY LOSS OF CUSTOMER'S BUSINESS, REVENUES, PROFITS, THE COST TO CUSTOMER OF THEIR ADVERTISEMENT OR ANY OTHER SPECIAL, INCIDENTAL, CONSEQUENTIAL OR PUNITIVE DAMAGES OF ANY NATURE, OR FOR ANY CLAIM AGAINST CUSTOMER BY ANY THIRD PARTY. ALL EXPRESS AND IMPLIED WARRANTIES REGARDING THE WEB SITE AND INTERNET SERVICES ARE DISCLAIMED, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. Ameritech shall not be liable for delays or interruption in production and/or presentation in the event of acts of God, by any government or quasi-governmental entity, fire, flood, insurrection, riot, explosion, embargo, strikes, labor or material shortage, transportation interruption of any kind, temporary interruption in internet services due to necessary repair or adjustments, or any condition beyond the direct control of Ameritech. Customer acknowledges that Ameritech cannot guarantee any results of any sort whatsoever as a result of the web site or Internet Services.
(Ex. 1 to Compl. (emphasis and capitalization in original).) In addition, Defendant AIMS contends that no genuine issue of fact exists that AIMS' contract with Plaintiffs included an agreement to register Plaintiffs' web site. Because the Court finds that the limited liability clause is enforceable, the Court need not address AIMS' remaining argument.
Under Michigan law, "unambiguous contracts are not open to judicial construction and must be enforced as written." Rory v. Continental Ins. Co., 473 Mich. 457, 703 N.W.2d 23, 30 (2005) (emphasis in original). A court "has no authority to change the terms of a contract simply because it might feel that it was an unwise contract for a party to have entered into". See Mich. Assoc. of Psychotherapy Clinics v. Blue Cross, 101 Mich. App. 559, 301 N.W.2d 33, 40 (1980). The courts expressly have recognized that a limitation of liability clause that limits damages in case of breach is enforceable if the nature of the transaction makes damages difficult to ascertain. See Ross v. Loescher, 152 Mich. 386, 116 N.W. 193 (1908); St. Paul Fire and Marine Ins. Co. v. Guardian Alarm Co., 115 Mich.App. 278, 320 N.W.2d 244 (1982). Where a contract provision is unambiguous, "[o]nly recognized traditional contract defenses may be used to avoid the enforcement of the contraction provision." Rory, 703 N.W.2d at 31. Such defenses include duress, waiver, estoppel, fraud and unconscionability. Id. at 31 n. 23.
Plaintiffs do not dispute that all three contracts they signed contained an identical limited liability clause, which, if enforceable, would bar the specific forms of damages they presently seek. They contend, however, that the clauses are not enforceable because they are unconscionable. They also contend that the clauses are not enforceable because they fail of their essential purpose by depriving Plaintiffs of the substantial benefit of their bargain.
A. Unconscionability
Under Michigan law, in order to invalidate a contract provision for unconscionability, a party must demonstrate that the provision is both procedurally and substantively *1045 unconscionable. See Allen v. Mich. Bell. Tel. Co., 18 Mich.App. 632, 171 N.W.2d 689, 692 (Mich.Ct.App.1969); Northwest Acceptance Corp. v. Almont Gravel, Inc., 162 Mich.App. 294, 412 N.W.2d 719, 723 (1987). Before finding a provision to be unconscionable, a court must make two inquiries:
(1) What is the relative bargaining power of the parties, their relative economic strength, the alternative sources of supply, in a word, what are their options?;
(2) Is the challenged term substantively reasonable?
Allen, 171 N.W.2d at 692. In other words, in order to show unconscionability, a party must demonstrate "an absence of meaningful choice on the part of one of the parties together with contract terms which are unreasonably favorable to the other party." Northwest Acceptance, 412 N.W.2d at 723. Although unconscionability is rarely found in a commercial context, see U.S. Fibres v. Proctor & Schwartz, Inc., 509 F.2d 1043, 1048 (6th Cir.1975), in limited circumstances, the courts have found commercial contracts to be unconscionable, see Northwest Acceptance Corp., 412 N.W.2d at 722; Allen, 171 N.W.2d at 694; Johnson v. Mobil Oil Corp., 415 F.Supp. 264 (E.D.Mich.1976).
1. Procedural unconscionability
A contract is procedurally unconscionable if a party, in agreeing to the contract, has no realistic alternative to agreement. See Allen, 171 N.W.2d at 694. Courts have refused to enforce agreements "where one party is at such obvious disadvantage in bargaining power that the effect of the contract is to put him at the mercy of the other's negligence." Id. at 693 (internal citations omitted). However, "merely because the parties have different options or bargaining power, unequal or wholly out of proportion to each other, does not mean that the agreement of one of the parties to a term of contract will not be enforced against him; if the term is substantively reasonable it will be enforced." Id. at 692.
The Michigan Court of Appeals previously addressed a situation in which a limited liability clause was included in a contract for yellow pages advertising with a defendant telephone company. See Allen, 18 Mich.App. 632, 171 N.W.2d 689. In Allen, an insurance agent contracted to place several advertisements in the Flint classified telephone directory. The clause in issue limited liability for breach of contract to the amount paid for such advertising in the issue in which the error occurred. The defendant telephone company subsequently failed to include the advertisement in the yellow pages as it had promised in the contract. Id. at 690. The plaintiff claimed that the telephone company, as a public utility, could not limit liability for its own negligence. Id. at 691-92. The court concluded, however, that, in the circumstances of the case, the telephone company was the only free yellow pages provider and had an effective monopoly on the services. Id. at 693-94. The court also recognized that no different but comparably inexpensive advertising vehicle was available to the plaintiff. Id. The court therefore found procedural unconscionability because the plaintiff had no practical alternative but to sign the agreement. Id. The court went on to find that, because the clause limited damages to the contract price in circumstances where the contract was wholly unperformed, the clause effectively relieved the company of all liability and therefore was substantively unreasonable. Id. at 694.
Since it was issued, the Michigan courts have limited the scope of Allen. In St. Paul Fire, 115 Mich.App. 278, 320 N.W.2d 244, the court considered a case in which a company contracted with a provider of a burglar alarm system. The contract included a limited liability clause that fixed *1046 damages for breach at the aggregate amount of six monthly payments or $250, whichever was less. When plaintiff company was burglarized, its insurer sought damages from the burglar alarm company. The St. Paul Fire court held that, in contrast to Allen, the plaintiff company was not effectively forced to use a monopolistic burglar alarm supplier. In addition, damages caused by failure of the system would have been difficult to ascertain, given the variability of inventories. Further, even if such damages theoretically were ascertainable through inventory monitoring, the court emphasized that the burglar system provider was not an insurer. Id. at 247. On the basis of all of these factors, the court found that the transaction was not procedurally unconscionable, notwithstanding differences in bargaining power. Id.
Similarly, in Mich. Ass'n of Psychotherapy Clinics, 301 N.W.2d at 40, the court again distinguished Allen, concluding that the reasoning of Allen stood for a limited proposition:
[W]here goods or services used by a significant segment of the public can be obtained from only one source, or from limited sources on no more favorable terms, an unreasonable term in a contract for such goods or services will not be enforced as a matter of public policy.
Allen, 171 N.W.2d at 694, quoted in Mich. Ass'n of Psychotherapy Clinics, 301 N.W.2d at 40. The court in Mich. Ass'n of Psychotherapy Clinics noted that, while Blue Cross was a major health insurer, it was not the only health insurer. Id. at 41. The plaintiff, therefore, was not faced with a single monopolistic option faced by the plaintiff in Allen. See also Clark v. DaimlerChrysler Corp., 268 Mich.App. 138, 706 N.W.2d 471 (2005) (holding that a limitation on the statute of limitations for all employee claims was not procedurally unconscionable, notwithstanding the fact that the clause was included in an employee application completed four months before the employee was hired); USAA Group v. Universal Alarms, Inc., 158 Mich.App. 633, 405 N.W.2d 146, 147 (1987) (rejecting claim that individuals who contracted with alarm company were in a procedurally unconscionable bargaining position, since other alarm systems, even if different in type, were available to the plaintiffs); WXON-TV v. A.C. Nielsen Co., 740 F.Supp. 1261 (E.D.Mich.1990) (holding that a contract between a television station and a rating service was not procedurally unconscionable because the company was not a monopolistic public service, despite the fact that the rating service was one of only two such services, both of whom limited damages).
Plaintiffs argue that the case is more closely analogous to Johnson v. Mobil Oil Corp., 415 F.Supp. 264 (E.D.Mich. 1976). In Johnson, plaintiff service station owner sued Mobil Oil Corporation for providing adulterated gasoline that allegedly caused a fire which destroyed the plaintiff s service station. Johnson's contract with Mobil excluded "special, indirect or consequential damages", and Mobil attempted to limit damages to "difference money damages," the difference between the value of the goods at the time and place they were accepted and the value they would have had if they had been warranted. The court found the limited liability clause to be unconscionable, in part because the station owner had completed only one-and-one-half years of high school and had limited business experience. Plaintiffs argue that they were similarly uneducated. In contrast to Johnson, however, both plaintiffs had graduated from high school and Patricia Pichey attended two years of college. Both have run another business for a number of years. Plaintiffs were not in the same position as Johnson.
Plaintiffs next suggest that the contract provision was procedurally unconscionable *1047 because they were presented with a standardized and preprinted contract containing the limited liability clause on the reverse side of the document. However, the courts routinely have rejected a finding of procedural unconscionability on the grounds that a plaintiff was presented with a preprinted, form contract rather than engaging in a clause-by-clause negotiation of an agreement. See Rory v. Continental Ins. Co., 473 Mich. 457, 703 N.W.2d 23, 42 (2005) ("The term `adhesion contract' may . . . be used to describe a contract for goods or services offered on a take-it-or-leave-it basis. But it may not be used as a justification for creating any adverse presumptions or for failing to enforce a contract as written."); St. Paul Fire, 320 N.W.2d at 247 ("The mere fact that a contract is standardized and preprinted does not make it unenforceable as a contract of adhesion.").
Moreover, in two unpublished decisions, courts have considered whether contracts with Ameritech Publishing, Inc., another sister corporation to AIM and AIMS, were unconscionable because they contained preprinted and nearly identical limited liability clauses to those present in the instant case. See All Makes S-V, Inc. v. Ameritech Pub., Inc., No. 221188, 2001 WL 951381 (Mich.Ct.App. Aug.21, 2001); Nolan, Inc. v. Ameritech Pub., Inc., No. 89-CV-72028 (E.D. Mich. April 3, 1990). In both decisions, the courts considered whether Ameritech's failure accurately to publish information in its yellow pages could be subjected to a limited liability clause. The courts concluded that Allen was inapplicable to the case because, at the time of those decisions, Ameritech no longer was a monopolistic public utility or the sole provider of free yellow pages. Instead, because telephone services had been deregulated, the plaintiff had other yellow page opportunities available, as well as radio, television and print advertising. Accordingly, both courts found that the limited liability clauses in issue were not procedurally unconscionable. All Makes S-V, 2001 WL 951381, at *1-2; Nolan, No. 89-CV-72028, slip op. at 3-4.
In the instant case, it is undisputed that the internet hosting and web design services purchased by Plaintiffs from AIM and AIMS were available from many sources. Specifically, Defendant AIMS has provided copies of local telephone directories for the period between 1997 and 2001, all of which demonstrate the availability of multiple internet service providers and web design companies providing a wide range of services. (AIMS Reply Br., Ex. 14.) They also have attached the affidavit of Beth Kinna, which declares on personal knowledge that multiple alternate sources were available at the time of the contract. (Kinna Aff., ¶ 6.; AIMS Brief for Sum. J., Ex. 6.) Plaintiffs' argue, however, that AIMS and AIM, operating collectively, provided the only available opportunity for Plaintiffs' to purchase all of the desired services from the same source and a source that also published a paper yellow pages. Plaintiffs' distinction is unreasonable. All of the services Plaintiffs desired could have been provided by numerous sources.[1] Absolutely *1048 no facts have been alleged or proved that would demonstrate an essential reason for having the electronic services provided by the same company as the paper services. Moreover, even were such a basis demonstrated, the distinction would not show that Plaintiffs lacked reasonable alternatives. The mere fact that a party may prefer the particular and specific features of a service provided by one company does not render that company's service monopolistic or the realistic alternative available. See, e.g., USAA Group, 405 N.W.2d at 147 ("We are not aware of any limitations preventing the Muellers from obtaining a central monitoring arrangement from another source or from obtaining some other protection system, such as a noise-generating system or a sprinkler system.") (emphasis added). The case, therefore, is completely distinguishable from the circumstances presented in Allen, 171 N.W.2d at 692-93, in which there was no realistic alternative to yellow pages advertising through Michigan Bell.
Further, the Court rejects Plaintiffs' argument that they have shown that all competitors included the same limited liability language. In support of their argument, Plaintiffs rely on the deposition testimony of AIM employee, Beth Kinna. Contrary to Plaintiffs' representations, however, Kinna did not testify that all other competitors had similar clauses. She, in fact, denied having seen competitors' clauses, having been told about their contents, or having known whether competitors' contracts differed from those of AIM and AIMS. When asked to speculate, she began to answer with an equivocal word, but was interrupted by an objection. (Kinna dep. at 71; Pl. Br. in Opp. to AIM Mot., Ex. L.) Even had she answered, such speculation would not have constituted admissible evidence about the contents of competitor agreements.
Plaintiffs next argue that, because they did not read the contract, they should be excused from application of the limited liability provision. While Plaintiffs do not specifically claim that they were completely unaware of the numerous preprinted clauses on the backs of the agreements they signed, they aver that the existence of the limited liability clause was never pointed out to them by Defendants' representative. Under Michigan law, "one who signs an agreement, in the absence of coercion, mistake, or fraud, is presumed to know the nature of the document and to understand its contents, even if he or she has not read the agreement." Clark, 706 N.W.2d at 475. Plaintiffs may not claim to be excused from those portions of the contract they sign simply because they neglected to read them. Moreover, the effect of one party's failure to read a provision may do nothing more than prevent a contract from forming; it does not permit enforcement of alternate terms against the other party:
[T]he expectation that a contract will be enforceable other than according to its terms surely may not be said to be reasonable. If a person signs a contract without reading all of it or without understanding it, under some circumstances that person can avoid its obligations on the theory that there was no *1049 contract at all for there was no meeting of the minds. But to allow such a person to bind another to an obligation not covered by the contract as written because the first person thought the other was bound to such an obligation is neither reasonable nor just.
Wilkie v. Auto-Owners Ins. Co., 469 Mich. 41, 664 N.W.2d 776, 788 (2003) (quoting Raska v. Farm Bureau Mut. Ins. Co., 412 Mich. 355, 314 N.W.2d 440, 441 (1982)); see also Rory, 703 N.W.2d at 42 (same). Plaintiffs' argument, therefore, cannot support its claim for damages beyond those provided in the limited liability clause.
In sum, the evidence unequivocally shows that AIM and AIMS were not the sole providers for the range of services purchased by Plaintiffs. In addition, the types of services available through AIM and AIMS did not offer the only "realistic alternative" for Plaintiffs to advertise their products. Allen, 171 N.W.2d at 694. Because Plaintiffs have failed to show that Defendants had the sort of monopolistic power described in Allen, the case is controlled by the reasoning of St. Paul Fire, 320 N.W.2d at 246-47. As a result, Plaintiffs fail to demonstrate the necessary procedural unconscionability.[2]
2. Substantive unconscionability
Even had Plaintiffs demonstrated procedural unconscionability, their claims would fail because they have failed to show substantive unconscionability. "Whether a contractual provision is substantively unreasonable or unconscionable depends on the commercial setting, purpose and effect of the provision." Mich. Ass'n of Psychotherapy Clinics, 301 N.W.2d at 41 (citing Reed v. Kaydon Eng'g Corp., 38 Mich.App. 353, 196 N.W.2d 487 (1972)). "Reasonableness is the primary consideration." St. Paul Fire, 320 N.W.2d at 247. However, a "contract is not substantively unconscionable simply because it is foolish for one party and very advantageous to the other." Clark, 706 N.W.2d at 475. Instead, a provision is substantively unreasonable "where the inequity of the term is so extreme as to shock the conscience." Id.
Plaintiffs have not and cannot demonstrate such conscience-shocking inequity. The limited liability provision in the instant case permits Plaintiffs to recover the full amount of their contract price of $1,600. That liquidated damage amount for the type of breach alleged in this case is not shocking to the conscience. In addition, Plaintiffs already have received a substantial extension of the term of their agreement on the grounds of the alleged breach. Further, Plaintiffs do not dispute that Defendants completed all of the promises of the contract, with the exception of the promise to register the web site with the major internet search engines. Indeed, *1050 Plaintiffs acknowledge that, in addition to being able to contract with other providers, Plaintiffs themselves could have registered their web site with the internet search engines. Moreover, Plaintiffs have introduced no evidence to contradict Beth Kinna's testimony that, even in 1998, if a web site were registered with a search engine, there was no guarantee that the search engine would post it. (Kinna dep., at 56.; Pl. Brief Opp. AIM Mot. for Sum. J., Ex. L.)
Here, as in St. Paul Fire, Defendants are "not in the insurance business." 320 N.W.2d at 247. The contracts made it clear that Defendants did not promise particular results from the web-based advertising they agreed to provide. "Under these circumstances a clause limiting defendant's liability in the event the [web site] did not work properly is not unconscionable." Id. (finding limitation of the aggregate of six monthly payments or $250 was manifestly reasonable); see also USAA Group, 405 N.W.2d at 147 (limitation of $250 not substantively unreasonable); WXON-TV, 740 F.Supp. at 1266 (limitation of six months' payments or $250 not unreasonable). Under the clearly established case law, the limited liability clause in the instant case was not substantively unconscionable.
B. Failure of Contract's Essential Purpose
Plaintiffs next argue that the limited liability clause is unenforceable because it fails of its essential purpose. They argue that the clause deprives Plaintiffs of the benefit of their bargain, permitting Defendants to escape liability for a breach of their agreement.
Under Michigan law, the failure-of-the-essential-purpose doctrine applies only to matters falling under Article 2 of the Uniform Commercial Code ("UCC"), MICH. COMP. LAWS § 440.2102. Article 2 of the UCC, however, applies only to transactions in goods, not transactions for services. See Wells v. 10-X Mfg. Co., 609 F.2d 248, 254 (6th Cir.1979); DeValerio v. Vic Tanny Int'l, 140 Mich.App. 176, 363 N.W.2d 447 (1984); Plymouth Pointe Condo. Ass'n v. Delcor Homes-Plymouth Pointe, Ltd., No. 233847, 2003 WL 22439654, at *2 (Mich.Ct.App. Oct.28, 2003). No Michigan case has applied the doctrine to a services contract.
Plaintiffs rely exclusively on this Court's decision in Jacada, Nos. 1:02-CV-479 and 1:02-CV-78. In Jacada, the Court acknowledged that the failure-of-the-essential-purpose doctrine was, by its terms, applicable only to Article 2 agreements. Jacada, slip. op. at 13-14. The Court, however, concluded that at least two federal courts had applied the doctrine to a service contract or a hybrid contract involving both service and sale of goods. As a result, while the Court expressed skepticism about the correctness of the arbitrator's application of the doctrine to a services agreement, it could not conclude that such application actually "fl[ew] in the face of clearly established legal precedent." Id. (quoting Merrill Lynch, 70 F.3d at 421).
In the instant case, however, the Court must apply the law de novo. The Court finds no basis in the Michigan case law for extending the doctrine to cases outside the application of Article 2. Instead, the doctrine of unconscionability more properly provides the vehicle for determining whether the terms of a services contract are sufficiently one-sided as to undermine the purpose of the agreement.
Moreover, even were the Court to apply the doctrine to a service agreement, the instant limited liability clause does not fail of its essential purpose. Instead, under the limited remedy provided in the contract, Plaintiffs may recover a full refund *1051 for an alleged failure to complete a small portion of the agreement that Plaintiffs themselves were fully capable of rectifying with little effort. See WXON-TV, 740 F.Supp. at 1266-67 (considering whether a limitation of remedies clause failed of its essential purpose when it permitted a party to recover a refund or receive a credit in the amount paid). While Plaintiffs attempt to characterize the alleged breach as a complete failure to perform, they do not dispute that they received a registered domain name, web site and page design, e-mail addresses, a link from their internet yellow page listing to the web site, and virtual hosting. Registration with search engines, even if completed, would not have guaranteed inclusion by search companies in search results, and the failure to register did not render the web site and e-mail contacts useless. As a result, the damages permitted under the contract clearly are sufficient to create a binding, mutual contract and prevent Defendants from escaping all liability for their alleged negligence. Id.
IV.
For the foregoing reasons, the Court will grant Defendants' motions for summary judgment. A judgment consistent with this opinion shall be entered.
JUDGMENT
In accordance with the opinion entered this date,
IT IS ORDERED that Defendants' motions for summary judgment (Docket ## 11, 13) are GRANTED.
IT IS FURTHER ORDERED that judgment is hereby entered against Plaintiffs and in favor of Defendants.
NOTES
[1] Plaintiffs present the affidavit of a law clerk (G. Alan Wallace), which contains hearsay evidence provided by an employee of Verizon Communications (Ed Fritz), who formerly was employed with GTE Corporation before its merger with Bell Atlantic to form Verizon in 2000. Fritz purportedly told Wallace that, from 1998 to late 2000, GTE Super Pages had only one on-line yellow page competitor in Michigan: Ameritech. Further, Fritz purportedly advised that GTE did not offer its web page design and registration services until late 2000, and did not offer a link from its yellow pages until 2000. (G. Alan Wallace Aff., ¶¶ 3-9.) On a motion for summary judgment, the party opposing the motion has the burden of introducing evidence sufficient to withstand the motion. FED. R. CIV. P. 56(a). Rule 56(e) requires that affidavits used for summary judgment purposes be made on the basis of personal knowledge, set forth admissible evidence, and show that the affiant is competent to testify. Rule 56(e) further requires the party to attach sworn or certified copies of all documents referred to in the affidavit. Id. Hearsay evidence cannot be considered on a motion for summary judgment. See Carter v. Univ. of Toledo, 349 F.3d 269, 274 (6th Cir.2003); Wiley v. U.S., 20 F.3d 222, 225-26 (6th Cir.1994); Daily Press, Inc. v. United Press Int'l, 412 F.2d 126, 133 (6th Cir.1969).
[2] In support of their claim of both procedural and substantive unconscionability, Plaintiffs also rely heavily on Jacada, Ltd. v. Int'l Mktg. Strategies, Inc., Nos. 1:02-CV-479, 1:02-C78, 2003 WL 24267645 (W.D.Mich. Oct.21, 2003), aff'd 401 F.3d 701 (6th Cir.2005). In Jacada, this Court upheld an arbitration award in which the arbitrator found a limited liability provision to be unconscionable under Michigan law. The Court noted that its review was limited to determining whether the arbitrator's decision was in "manifest disregard of the law." Id., 2003 WL 24267645, *3 (quoting Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Jaros, 70 F.3d 418, 421 (6th Cir.1995)). The Court acknowledged that mere error in interpretation or application of the law was insufficient. Applying that standard, the Court concluded that, while it might disagree with the arbitrator's finding of unconscionability, it could not say that the finding was entered in manifest disregard of the law. Id., 2003 WL 24267645, *6. In light of the highly deferential standard of review involved in Jacada, the case is of limited applicability to the question before the Court requiring de novo application of Michigan law.
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Fourth Court of Appeals
San Antonio, Texas
JUDGMENT
No. 04-13-00487-CR
Elbert Lee SANDERS,
Appellant
v.
The STATE of Texas,
Appellee
From the 54th Judicial District Court, McLennan County, Texas
Trial Court No. 2012-327-C2
Honorable Matt Johnson, Judge Presiding
BEFORE JUSTICE ANGELINI, JUSTICE MARION, AND JUSTICE ALVAREZ
In accordance with this court’s opinion of this date, the trial court’s judgment is
AFFIRMED.
SIGNED August 29, 2014.
_____________________________
Patricia O. Alvarez, Justice
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