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UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD
KENNETH M. HULETT, DOCKET NUMBER
Appellant, SF-0752-11-0690-B-1
v.
DEPARTMENT OF THE NAVY,
Agency. DATE: September 26, 2014
THIS FINAL ORDER IS NONPRECEDENTIAL 1
Brook L. Beesley, Alameda, California, for the appellant.
Patricia Zengel, Esquire, San Diego, California, for the agency.
BEFORE
Susan Tsui Grundmann, Chairman
Anne M. Wagner, Vice Chairman
Mark A. Robbins, Member
FINAL ORDER
¶1 The agency has filed a petition for review of the remand initial decision,
which sustained the appellant’s removal. Generally, we grant petitions such as
this one only when: the initial decision contains erroneous findings of material
1
A nonprecedential order is one that the Board has determined does not add
significantly to the body of MSPB case law. Parties may cite nonprecedential orders,
but such orders have no precedential value; the Board and administrative judges are not
required to follow or distinguish them in any future decisions. In contrast, a
precedential decision issued as an Opinion and Order has been identified by the Board
as significantly contributing to the Board’s case law. See 5 C.F.R. § 1201.117(c).
2
fact; the initial decision is based on an erroneous interpretation of statute or
regulation or the erroneous application of the law to the facts of the case; the
judge’s rulings during either the course of the appeal or the initial decision were
not consistent with required procedures or involved an abuse of discretion, and
the resulting error affected the outcome of the case; or new and material evidence
or legal argument is available that, despite the petitioner’s due diligence, was not
available when the record closed. Title 5 of the Code of Federal Regulations,
section 1201.115 (5 C.F.R. § 1201.115). After fully considering the filings in this
appeal, and based on the following points and authorities, we conclude that the
petitioner has not established any basis under section 1201.115 for granting the
petition for review. Therefore, we DENY the petition for review and AFFIRM
the remand initial decision, which is now the Board’s final decision. 5 C.F.R.
§ 1201.113(b).
¶2 As a Lead Firefighter, the appellant was subject to random drug testing.
Initial Appeal File (IAF), Tab 7 at 11. On March 26, 2011, he exhibited behavior
which gave the agency a reasonable suspicion that he was unable to perform his
duties. He was directed to undergo a drug test, which verified positive for
marijuana. The agency proposed his removal for Illegal Drug Use, specifically,
testing positive for marijuana, id. at 123, and, at the same time, referred him to
the Civilian Employee Assistance Program (CEAP), id. at 125. He was removed
effective May 31, 2011. Id. at 14, 11. On appeal, the appellant admitted that he
used marijuana but alleged, inter alia, that the agency committed harmful error in
that the deciding official considered, in her penalty determination, aggravating
factors with which the appellant was not charged and/or had ex parte
communications that violated his due process rights. Id., Tab 17 at 3. The
appellant also raised claims of disability discrimination and retaliation for
engaging in protected activity. Id. at 3-4; Tab 20 at 4-5.
¶3 After convening the requested hearing, the administrative judge issued an
initial decision affirming the removal action. Id., Tab 21, Initial Decision (ID) at
3
1, 18. He found that the charge was sustained, ID at 1-6; that the appellant failed
to prove his affirmative defenses of harmful error, disability discrimination, and
retaliation for protected activity, ID at 7-10; and that the agency proved that a
nexus existed between the sustained charge and the efficiency of the service and
that the penalty of removal was reasonable, ID at 10-17.
¶4 On the appellant’s petition for review, the Board first noted that he did not
challenge the administrative judge’s findings that the agency proved the charge
and that the appellant did not prove his affirmative defenses of disability
discrimination and retaliation, stating that “we do not address these issues.”
Hulett v. Department of the Navy, 120 M.S.P.R. 54, ¶ 5 n.2 (2013). The Board
found, however, that the appellant implicitly raised a due process claim
concerning the penalty imposed but that the administrative judge neither informed
him of the applicable burdens of proof nor adjudicated the claim. Id., ¶¶ 9-10. In
remanding the case for further adjudication, id., ¶ 10, the Board directed the
administrative judge to apprise the appellant of his burden and the elements of
proof regarding his due process claim and to obtain clarification from him as to
the alleged ex parte communications regarding aggravating factors that the
deciding official allegedly considered in her penalty assessment. Id., ¶ 11. If the
administrative judge found that there was an ex parte communication and that it
was so substantial and so likely to cause prejudice that no employee could fairly
be required to be subjected to a deprivation of property under the circumstances,
then the administrative judge was to find a due process violation and reverse the
agency action; if not, then the administrative judge was to conduct a harmful
error analysis as to any procedural error concerning the penalty determination.
Id. The Board also vacated the administrative judge’s findings regarding nexus
and penalty. Id., ¶ 1.
¶5 On remand and as directed, the administrative judge issued an order setting
out for the appellant the applicable burdens of proof on his claims of denial of
due process and harmful procedural error. Remand Appeal File (RAF), Tab 3 at
4
1-2. And, as directed, the administrative judge afforded the appellant an
opportunity to clarify the ex parte communications that he alleged the deciding
official considered without notice to him. Id. at 3. The administrative judge
referred the appellant to the matters the Board had set forth in its Opinion and
Order as those he had identified in his petition for review. Id. at 3 n.1; see
Hulett, 120 M.S.P.R. 54, ¶ 2. The appellant responded, RAF, Tab 4, as did the
agency, id., Tab 5.
¶6 In his remand initial decision, the administrative judge first repeated the
analysis of the charge of Illegal Drug Use that he made in his earlier initial
decision and his finding that the agency met its burden of proof. 2 RAF, Tab 6,
Remand Initial Decision (RID) at 2-7. In addressing the denial of due process
claim, the administrative judge considered the appellant’s response to the order
he issued wherein the appellant appeared to allege that the deciding official had
ex parte communications with the commanding officer of the naval base
regarding the events underlying the agency’s charge and that that information
influenced the deciding official’s decision to remove the appellant, thus depriving
him of due process. RAF, Tab 4. Noting the testimony of the deciding official
that she never spoke with the commanding officer or received any guidance from
him, the administrative judge concluded that the appellant did not establish an ex
parte communication. RID at 10.
¶7 The administrative judge then considered the allegations the appellant
raised in his petition for review, matters of which, he contended, he was not made
aware in the notice of proposed removal. They included his conviction for
driving under the influence, his observed impairment, his inability to perform his
duties, his use of a mind-altering drug, and his insubordination in not taking the
2
The administrative judge need not have undertaken this analysis, given that the Board
affirmed his earlier finding that the agency proved its charge by preponderant evidence.
Hulett, 120 M.S.P.R. 54, ¶ 1. Nonetheless, the administrative judge’s additional
analysis did not constitute error.
5
drug test on the date he was ordered to do so. The administrative judge found
that, based on the proposal notice, the appellant was aware of these matters and
had a full and fair opportunity to respond to them, which he did, and that the
record contained no evidence of ex parte communication of any new and material
information to the deciding official that was not brought to the appellant’s
attention in the proposal notice. RID at 11. As to the consistency of the penalty,
the notoriety of the misconduct, the deciding official’s belief that, as an illegal
drug user, the appellant lacked rehabilitative potential and that lesser discipline is
not a successful deterrent for such employees, the administrative judge found that
the appellant did not explain what he believed to be any ex parte communication
from or to the deciding official that she considered without giving him notice and
an opportunity to respond and that, to the extent the deciding official testified that
she considered these factors, they too were referenced in the proposal notice.
RID at 11-13.
¶8 Having found no due process violation, the administrative judge as directed
considered whether the appellant had established harmful error. In finding that he
did not, the administrative judge similarly found that he had not established that
the agency committed any procedural error, much less any error that was likely to
have caused the agency to reach a conclusion different from the one it would have
reached in the absence or cure of the error. RID at 14-15.
¶9 Next, the administrative judge repeated the findings he had earlier made in
concluding that the appellant failed to establish his allegations of disability
discrimination and retaliation. 3 RID at 15-16. Lastly, the administrative judge
3
As noted, the Board found in its Opinion and Order that the appellant did not
challenge the administrative judge’s finding that he failed to prove his affirmative
defenses of disability discrimination and retaliation and that “[t]herefore, we do not
address these matters.” Hulett, 120 M.S.P.R. 54, ¶ 5 n.2. The Board’s Opinion did not
direct the administrative judge to make any further findings as to these claims and
therefore he need not have done so. See Umshler v. Department of the Interior,
55 M.S.P.R. 593, 597, aff’d, 6 F.3d 788 (Fed. Cir. 1992) (Table). Again, however, this
did not constitute error.
6
found, as he had earlier, that the agency established that discipline for the
sustained misconduct promoted the efficiency of the service and that removal for
that misconduct was a reasonable penalty. RID at 17-24.
¶10 The appellant has filed a petition for review, Remand Petition for Review
(RPFR) File, Tab 6, to which the agency has responded in opposition, id., Tab 8.
¶11 Concerning the due process issue, the appellant argues on review that,
although not part of the agency’s charge, the deciding official considered as an
aggravating factor that the appellant was or may have been under the influence
and/or was impaired. RPFR File, Tab 6 at 4; IAF, Tab 7 at 14. It is well
established that only ex parte communications that introduce new and material
information to the deciding official will violate the due process guarantee of
notice. Stone v. Federal Deposit Insurance Corporation, 179 F.3d 1368, 1377
(Fed. Cir. 1999); Lopes v. Department of the Navy, 116 M.S.P.R. 470, ¶ 7 (2011).
Here, as the administrative judge found, the notice of proposed removal includes,
in the narrative of the facts underlying the charge, a description of the appellant
as provided by the Chief who interviewed him after several members of the
Federal Fire Department reported that he did not appear to be able to perform his
duties. IAF, Tab 7 at 123. The proposing official related that the Chief described
the appellant as slumped in his chair, with bloodshot eyes, pinpointed pupils, and
slurred speech, and agreed that he was not capable of performing his duties. Id.;
RID at 11. The appellant has not shown error in the administrative judge’s
finding that, to the extent that there was an ex parte communication regarding the
appellant’s possible impairment, it introduced only cumulative evidence, not new
and material evidence, and therefore did not constitute a due process violation.
For the same reason, we find that the appellant has not shown error in the
administrative judge’s finding that, to the extent there was ex parte
communication regarding the appellant’s having used a mind-altering drug, it
introduced only cumulative evidence, not new and material evidence, and
therefore did not constitute a denial of due process. RID at 11.
7
¶12 The appellant argues further that, without giving advance notice to him, the
deciding official relied in her penalty determination on the fact that he had
received a Driving Under the Influence criminal conviction in 1998. RPFR File,
Tab 6 at 4; IAF, Tab 7 at 16-19 (the agency’s Douglas factors analysis).
However, the administrative judge considered the hearing testimony of the
deciding official wherein she specifically denied having given that conviction any
weight in her penalty assessment. RID at 11. The appellant has failed to show
error in the administrative judge’s findings that, because the 1998 conviction was
not a basis for the deciding official’s determination on either the merits of the
charge or the penalty to be imposed, there was no due process violation. Cf.
Lopes, 116 M.S.P.R. 470, ¶ 12 (explaining that the deciding official’s hearing
testimony confirmed his consideration of ex parte information about prior
misconduct found on the Douglas factors worksheet); Pickett v. Department of
Agriculture, 116 M.S.P.R. 439, ¶ 12 (2011) (highlighting that the deciding
official “testified that he considered information he received” outside the
proposal notice).
¶13 Finally, the appellant argues on review that he was not on notice of the
deciding official’s consideration in her penalty determination of certain matters
she deemed as aggravating factors, specifically, the notoriety of the offense and
the appellant’s being willfully defiant and insubordinate. RPFR File, Tab 6 at 5.
As the administrative judge found, however, both of these matters were
referenced in the notice of proposed removal, wherein the proposing official
noted that the appellant initially refused to report for drug testing on the date
identified and that, for a Lead Firefighter, the use of illegal drugs violates the
special trust of the general public who rely on Firefighters to protect life and
property. RID at 11-12; IAF, Tab 6 at 123. We find therefore that the appellant
has not shown error in the administrative judge’s finding that, to the extent these
8
matters constituted ex parte communications, they did not constitute a denial of
due process. 4
¶14 The appellant also appears to challenge on review the administrative
judge’s finding that removal is a reasonable penalty. 5 Specifically, the appellant
argues, as he did below, that the agency’s policy on illegal drug use provides that
a removal will be initiated for a first-time use if the employee refuses to obtain
counseling or rehabilitation through the CEAP or for a second finding of illegal
drug use. RPFR File, Tab 6 at 6. The appellant asserts that he fully cooperated
with the CEAP and completed an “extensive rehabilitation program” and that
these factors and others preclude the agency’s imposition of the removal penalty.
Id. The administrative judge carefully considered the appellant’s claim but
found, based on Board precedent, that removal may be appropriate for a first-time
offense, notwithstanding the employee’s participation in the CEAP, depending on
the deciding official’s careful consideration of the factors set out by the Board in
Douglas v. Veterans Administration, 5 M.S.P.R. 280, 306 (1981). RID at 22-24;
see Zazueta v. Department of Justice, 94 M.S.P.R. 493, ¶¶ 6-11 (2003), aff’d,
104 F. App’x 166 (Fed. Cir. 2004).
¶15 Here, as the administrative judge correctly found, the deciding official did
consider the relevant Douglas factors in rendering her decision, including:
(1) the seriousness nature of the appellant’s misconduct that was antithetical to
4
The appellant has not, on review, challenged the administrative judge’s finding that he
did not establish harmful procedural error, and we discern no basis upon which to
disturb that finding.
5
In connection therewith, the appellant argues that, by not allowing him to fully
question the deciding official on cross-examination, the administrative judge prevented
him from presenting his claim related to disparate penalty, that is, that other agency
employees who had tested positive for illegal drugs were not ultimately removed from
their positions because the agency offered, and they accepted, last-chance settlement
agreements. RPFR File, Tab 6 at 2-3. A majority of the Board considered this
argument in its Opinion and Order but found that it provided no basis to disturb the
initial decision. Hulett, 120 M.S.P.R. 54, ¶ 5 n.2. Therefore we will not further
consider it.
9
the duties of his position, which require critical thinking and the ability to
manage stressful situations; (2) the fact that, as a Lead Firefighter, he directly
supervised a crew of three or four personnel and was therefore required to be
alert, attentive, and responsible for the safety of his crew; (3) that he provided
emergency services of a critical nature, impacting the preservation of life and
property, and was in contact with the public who depends on Firefighters and
typically holds them in high regard; (4) that she had lost confidence in the
appellant’s ability to perform his duties, which negatively impacted the agency’s
ability to accomplish its mission; (5) that the appellant’s drug test was the result
of his crew members’ reasonable suspicion of his impairment; (6) that removal
was within the range of penalties for a first offense of illegal drug use in the
applicable Table of Penalties; and (7) that the appellant was subject to random
drug testing and had been warned by a policy statement that illegal drug use could
lead to removal. RID at 17-23. The administrative judge further found that the
deciding official considered the appellant’s satisfactory performance ratings, his
past training, and letters of appreciation he had received but found that these
factors were not significant, given his 21 years of service. RID at 18-19. And,
she considered that he was experiencing personal and medical problems, but
found that he did not explain why these problems led him to illegal drug use,
rather than other coping mechanisms. RID at 23-24.
¶16 The administrative judge considered other mitigating factors cited by the
appellant, that is, his years of discipline-free service and the lack of notoriety
surrounding his misconduct, but found that these matters were outweighed by the
seriousness of his misconduct. RID at 24. Beyond his disagreement, the
appellant has not shown error in the administrative judge’s finding that, based on
the sole sustained charge, the penalty of removal did not exceed the bounds of
reasonableness. Ellis v. Department of Defense, 114 M.S.P.R. 407, ¶ 11 (2010);
Zazueta, 94 M.S.P.R. 493, ¶¶ 6-11. Accordingly, we affirm the remand initial
decision.
10
NOTICE TO THE APPELLANT REGARDING
YOUR FURTHER REVIEW RIGHTS
You have the right to request further review of this final decision.
Discrimination Claims: Administrative Review
You may request review of this final decision on your discrimination
claims by the Equal Employment Opportunity Commission (EEOC). See Title 5
of the United States Code, section 7702(b)(1) (5 U.S.C. § 7702(b)(1)). If you
submit your request by regular U.S. mail, the address of the EEOC is:
Office of Federal Operations
Equal Employment Opportunity Commission
P.O. Box 77960
Washington, D.C. 20013
If you submit your request via commercial delivery or by a method
requiring a signature, it must be addressed to:
Office of Federal Operations
Equal Employment Opportunity Commission
131 M Street, NE
Suite 5SW12G
Washington, D.C. 20507
You should send your request to EEOC no later than 30 calendar days after
your receipt of this order. If you have a representative in this case, and your
representative receives this order before you do, then you must file with EEOC no
later than 30 calendar days after receipt by your representative. If you choose to
file, be very careful to file on time.
Discrimination and Other Claims: Judicial Action
If you do not request EEOC to review this final decision on your
discrimination claims, you may file a civil action against the agency on both your
discrimination claims and your other claims in an appropriate United States
district court. See 5 U.S.C. § 7703(b)(2). You must file your civil action with
the district court no later than 30 calendar days after your receipt of this order. If
you have a representative in this case, and your representative receives this order
11
before you do, then you must file with the district court no later than 30 calendar
days after receipt by your representative. If you choose to file, be very careful to
file on time. If the action involves a claim of discrimination based on race, color,
religion, sex, national origin, or a disabling condition, you may be entitled to
representation by a court-appointed lawyer and to waiver of any requirement of
prepayment of fees, costs, or other security. See 42 U.S.C. § 2000e5(f) and
29 U.S.C. § 794a.
FOR THE BOARD: ______________________________
William D. Spencer
Clerk of the Board
Washington, D.C.
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United States Court of Appeals
FOR THE EIGHTH CIRCUIT
____________
Nos. 95-2012/2074
____________
Jin Ku Kim, *
*
A p p e l l a n t / C r o s s - a p p e l l e e ,
*
*
Appeals from the United States
v . *
District Court for the
*
Northern District of Iowa
Nash Finch Company, *
*
A p p e l l e e / C r o s s - a p p e l l a n t .
*
____________
Submitted: December 14, 1995
Filed: August 20, 1997
____________
Before McMILLIAN and BEAM, Circuit Judges, and PERRY,*
District Judge.
____________
McMILLIAN, Circuit Judge.
Jin Ku Kim appeals from a final judgment entered in
the District Court1 for the Northern District of Iowa,
*The Honorable Catherine D. Perry, United States District Judge for the
Eastern District of Missouri, sitting by designation.
1
The Honorable Michael J. Melloy, Chief Judge, United States District Court for
the Northern District of Iowa.
upon a jury verdict, finding in his favor and against
Nash Finch Co. in his employment discrimination case but
reducing the amount of damages
-2-
awarded by the jury. For reversal, Kim argues the
district court erred in denying his motion to amend the
pleadings to conform to the evidence under Fed. R. Civ.
P. 15(b) and in applying the Title VII cap, 42 U.S.C. §
1981a(b)(3), to limit compensatory and punitive damages.
On cross-appeal, Nash Finch argues the district court
erred in holding (1) Kim’s claim that he was unlawfully
denied a promotion from leadman to foreman in November
1990 was actionable under 42 U.S.C. § 1981, (2) there was
sufficient evidence of intentional discrimination, (3)
there was sufficient evidence of retaliation, (4) there
was sufficient evidence of malice or reckless
indifference to support punitive damages, and (5) the
jury verdict awarding damages for lost wages and
compensatory damages was supported by sufficient evidence
or, in the alternative, was not excessive. For the
reasons discussed below, we affirm the judgment of the
district court.
BACKGROUND FACTS
Nash Finch is a wholesale and retail food
distributor. In 1978 Kim, an American citizen of Korean
ancestry, began working as a grocery picker in Nash
Finch’s Cedar Rapids warehouse. A superintendent runs
the warehouse. During the period of time at issue Bill
Mund was the warehouse superintendent. The four
warehouse departments-- receiving, shipping, maintenance,
and transportation-- are each supervised by a salaried
“foreman.” By October 1979, Kim was one of six hourly
“leadmen” who assisted the warehouse shipping foreman;
Kim also acted as shipping foreman on Saturdays and
filled in when the shipping foreman was absent. The
-3-
shipping department has 80-90 employees; the full
shipping crew can consist of up to 70 employees; on
Saturdays, however, the shipping crew is smaller, about
25-40 employees. For more than 10 years, Kim received
“superior” or “outstanding” annual performance
evaluations.
The position of shipping foreman became vacant in
November 1990 and in April 1992. Kim applied for both
vacancies, but in each instance Nash Finch promoted
-4-
someone else. The individual promoted in November 1990
was white, younger than Kim, had less than a year’s
experience as a leadman, had been trained by Kim, and had
no formal education beyond high school. The individual
promoted in April 1992 was white, younger than Kim, had
not worked in the warehouse for 10 years, had been
trained by Kim, and had no formal education beyond high
school. In comparison, Kim was a college graduate and
the senior leadman in the shipping department. Nash
Finch told Kim that he had not been promoted because of
his inability to control costs and manhours, lack of
aggressiveness, difficulty in controlling large crews,
and poor temperament. When Kim objected to being passed
over for promotion, the Nash Finch EEO compliance officer
advised Kim to file a complaint or consult a lawyer. In
May 1992 Kim filed an employment discrimination charge
against Nash Finch with the Iowa Human Rights Commission
and the Equal Employment Opportunity Commission, alleging
Nash Finch unlawfully failed to promote him in November
1990 and in April1992 on the basis of race, national
origin and age.
According to Kim, immediately after he filed his
employment discrimination charge in May 1992, Nash Finch
began to systematically retaliate against him. For
example, Nash Finch supervisors no longer assigned Kim to
fill in for the shipping foreman, gave him much lower
performance evaluations, orally warned him about his poor
“attitude” (toward management), characterized him as
unwilling to assume more job responsibility when he
declined a Sunday shipping crew assignment, placed him
under constant surveillance at work, and excluded him from
meetings at work. Nash Finch mischaracterized a September
-5-
1992 incident involving Kim and another employee as
race-based, gave Kim a written reprimand about the
incident, and placed the written reprimand in Kim’s
personnel file. Kim alleged Nash Finch fabricated the
race basis of the incident in order to discredit him when
the local civil rights commission was investigating his
(Kim’s) employment discrimination charge. In November
1992, after another incident involving a co-worker and
another meeting with management, Nash Finch issued Kim a
written reprimand about the incident. During the summer
and fall of 1993, Nash Finch reviewed its warehouse
operations with the
-6-
assistance of a consultant and discovered what it
regarded as productivity problems, particularly with
respect to the Saturday shipping crew, which Kim
supervised, and required Kim to attend special retraining
in order to improve productivity on Saturdays. Kim
regarded this special retraining as punitive and
humiliating in light of his status as a leadman,
seniority and experience.
Kim continues to work for Nash Finch and has not been
discharged, demoted, reduced in compensation, or
reassigned; however, as noted above, he has received oral
and written reprimands and has been required to attend
special retraining. Brief for Appellee/ Cross-Appellant
at 1.
DISTRICT COURT PROCEEDINGS
In November 1992 Kim received a right-to-sue letter
and filed this lawsuit in federal district court. In
count I Kim alleged that Nash Finch unlawfully
discriminated against him on the basis of race, color,
national origin, and age when it failed to promote him to
the position of shipping foreman in April 1992 in
violation of Title VII of the Civil Rights Act of 1964
(Title VII), as amended, 42 U.S.C. § 2000e, and the Age
Discrimination in Employment Act (ADEA), as amended, 29
U.S.C. § 621 et seq. In count II Kim alleged that Nash
Finch unlawfully discriminated against him on the basis
of race, color, national origin, and age when it failed
to promote him to the position of shipping foreman in
-7-
November 1990 in violation of 42 U.S.C. § 1981.2 In count
III Kim alleged that Nash Finch unlawfully retaliated
against him for filing an employment discrimination
charge in violation of Title VII, 42 U.S.C. § 2000e-3(a).
Kim sought back pay, promotion and other equitable
relief, and compensatory and
2
This claim was not barred by the two-year statute of limitations under Iowa
Code Ann. § 614.1(2) (West Supp. 1997) because the failure-to-promote occurred on
November 18, 1990, and the complaint was filed on November 16, 1992.
-8-
punitive damages, as well as attorney’s fees and costs,
including expert witness fees.
Nash Finch filed a motion for summary judgment,
asserting that Kim had not been promoted because he had
no transportation experience and because of his
relatively weak management skills. The district court
denied the motion for summary judgment and in September
1994 the case was tried to a jury. At trial Mund
testified that he never seriously considered Kim for
promotion because Kim lacked personal loyalty to him
(Mund). Kim, his wife and his son testified about how
Kim had suffered physically and emotionally from his
adverse treatment by Nash Finch. Kim developed high
blood pressure and headaches from stress and became
anxious, withdrawn and depressed; he had difficulty
sleeping and felt humiliated and ostracized at work.
In special verdicts, the jury found Nash Finch had
discriminated against Kim on the basis of race but not
age in failing to promote him to shipping foreman in
November 1990 and in April 1992, and had retaliated
against him for filing employment discrimination charges.
The jury awarded Kim $15,000 in lost wages and benefits
and $100,000 in non-economic damages (for emotional
distress and loss of enjoyment of life) for the 1990
promotion claim, $21,000 in lost wages and benefits and
$150,000 in non-economic damages for the 1992 promotion
claim, and $1.5 million in non-economic damages for the
retaliation claim. Finally, the jury awarded Kim $7
million in punitive damages. The special verdict
permitted the jury to award punitive damages for either
the 1992 promotion or the retaliation claim. Both
parties filed post-trial motions.
-9-
The district court denied Nash Finch’s motion for
judgment as a matter of law or, in the alternative, for
new trial, reduced the damages award, granted in part
Kim’s motion for equitable relief (for promotion to
shipping foreman when available and front pay at the rate
of $447 per month), denied Kim’s motion for prejudgment
interest, granted Kim’s motion for attorney’s fees and
expenses, and entered judgment accordingly. Jin Ku Kim
v. Nash Finch Co., No. C92-0204 (N.D. Iowa Apr. 13, 1995)
-10-
(opinion and order). The district court held the
evidence was sufficient to support the jury’s finding
that Nash Finch had intentionally discriminated against
Kim on the basis of race, color or national origin when
it failed to promote him in November 1990 and in April
1992. Slip op. at 4-6. The district court also held the
evidence was sufficient to support the jury’s finding
that Nash Finch had retaliated against Kim for filing an
employment discrimination charge. Id. at 6-10. The
district court also held that the evidence was sufficient
to support the jury’s finding that Nash Finch had acted
with malice or reckless indifference to Kim’s federally
protected right not to be retaliated against for filing
a civil rights complaint. Id. at 11-12.
As discussed below, the parties disputed whether the
1992 promotion and retaliation claims were submitted
under both Title VII and 42 U.S.C. § 1981 or only Title
VII. The district court found that Kim had waived any
argument that these claims had been brought under both
statutes because Kim did not object to the jury
instructions and the special verdict forms which
submitted the 1992 promotion and retaliation claims under
Title VII without referring to 42 U.S.C. § 1981. Id. at
15 (noting plaintiff failed to object to jury
instructions). The district court also held that the
Title VII statutory damages cap applied, thus limiting
the award for non-economic damages and punitive damages
for those claims to a maximum of $300,000. Id. at 16
(jury awarded $150,000 for the 1992 promotion claim and
$1.5 million for the retaliation claim and $7 million in
punitive damages; it was not disputed that Nash Finch has
more than 500 employees; see 42 U.S.C. § 1981a(b)(4)
($300,000 maximum for compensatory and punitive
-11-
damages)). The district court did not review the
punitive damages award for excessiveness. Id. at 14
(noting nonetheless that $300,000 was not excessive in
view of duration of discrimination, level of retaliation
and financial well-being of employer).3 This appeal and
cross-appeal followed.
3
The district court reduced the jury verdict to a total of $421,000 ($21,000 for
lost wages, $100,000 for compensatory damages for the 1990 promotion, and $300,000
for compensatory and punitive damages for the 1992 promotion and the retaliation
claims). The district court also ordered front pay ($447 per month), promotion to the
next available foreman position (plus seniority from November 1990), attorney’s fees,
costs and expenses, and post-judgment interest.
-12-
ACTIONABLE § 1981 CLAIM-- 1990 PROMOTION
Nash Finch argues the district court erred in denying
its motion for judgment as a matter of law on the 1990
promotion claim. Nash Finch argues the 1990 promotion
claim is not actionable under 42 U.S.C. § 1981 because
the promotion from leadman to foreman did not involve a
significant change in duties, compensation or
responsibility. We disagree.
In Patterson v. McLean Credit Union, 491 U.S. 164,
176-77, 182 (1989) (Patterson), the Supreme Court held 42
U.S.C. § 1981 prohibited racial discrimination in the
formation of an employment contract but did not apply to
“problems that may arise later from the conditions of
continuing employment,” that is, in the employment
relationship. After Patterson, courts held that claims
alleging discriminatory discharge could not be brought
under § 1981. E.g., Taggart v. Jefferson County Child
Support Enforcement Unit, 935 F.2d 947, 948 (8th Cir.
1991) (banc). Congress later enacted the Civil Rights
Act of 1991 in part to correct what it regarded as the
Court’s erroneous construction of the scope of 42 U.S.C.
§ 1981 in Patterson. In § 101(2)(b) of the Act, 42
U.S.C. § 1981(b), Congress redefined the term “make and
enforce contracts” specifically to include “the making,
performance, modification, and termination of contracts,
and the enjoyment of all benefits, privileges, terms, and
conditions of the contractual relationship.” The 1991
Act became effective on November 21, 1991. However, in
Rivers v. Roadway Express, Inc., 511 U.S. 298 (1994), the
Supreme Court held that § 101 should not be applied
retroactively to pending cases or pre-enactment conduct.
For this reason, Patterson and not the 1991 Act applies
-13-
to the 1990 claim because it occurred before November 21,
1991, the effective date of the 1991 Act.
-14-
Patterson held that the denial of a promotion is not
actionable under § 1981 unless “the promotion rises to
the level of an opportunity for a new and distinct
relation between the employee and the employer.” 491
U.S. at 185, citing Hishon v. King & Spaulding, 467 U.S.
69 (1984) (challenging refusal of law firm to promote
associate to partnership under Title VII). Not every
refusal to promote violates Patterson because “each step
down the path of one’s career does not create a new and
distinct relation with the employer for purposes of the
Patterson test.” Fray v. Omaha World Herald Co., 960
F.2d 1370, 1373 (8th Cir. 1992) (footnote omitted).
“[Patterson] strongly suggests that, in addition to an
increase in pay and duties, an actionable promotion claim
must involve a meaningful, qualitative change in the
contractual relationship.” Sitgraves v. Allied-Signal,
Inc., 953 F.2d 570, 573 (9th Cir. 1992) (noting as
examples of actionable promotion claim moves from
non-supervisory to supervisory position and from hourly
to salaried compensation); see Rodriguez v. General
Motors Corp., 27 F.3d 396, 399-400 (9th Cir. 1994)
(holding essentially lateral change not actionable
refusal to promote); Butts v. City of New York Department
of Housing Preservation & Development, 990 F.2d 1397,
1411-12 (2d Cir. 1993) (Butts) (noting inquiry should not
be confined to job titles but should examine actual
changes in responsibility and status); cf. Winbush v.
Iowa, 66 F.3d 1471, 1477 (8th Cir. 1995) (issue noted but
not decided).
We agree with the district court that the promotion
from leadman to foreman involved a sufficiently new and
fundamentally different contractual relationship to
-15-
constitute an actionable promotion claim under § 1981.
This was not the kind of promotion “understood by the
parties to be given routinely upon satisfactory job
performance.” Butts, 990 F.2d at 1412. Nor was it the
kind of promotion that involved merely “moving an employee
from one position to another as part of a reallocation of
personnel resources, not involving a substantial increase
in status or responsibility.” Id. The promotion involved
a change from limited supervisory duties and limited
authority over employees to additional supervisory duties
and greater authority, from hourly to salaried
compensation, and from non-management to management
status, as
-16-
well as an increase in pay and a change of position in the
chain of authority. There were many leadman positions
(six in the shipping department alone) but only four
foreman positions, each in charge of one department in the
warehouse, who reported directly to the superintendent.
Unlike leadmen, foremen performed traditional supervisory
functions like making work assignments, planning and the
hiring, evaluation and discipline of employees. The
relatively modest difference in pay between the two
positions and the supervisory nature of both positions did
not outweigh the other factors. The district court did
not err in denying Nash Finch’s motion for judgment as a
matter of law on the 1990 promotion claim.
INTENTIONAL DISCRIMINATION
Nash Finch next argues Kim failed as a matter of law
to make a submissible case that he was not promoted in
1990 and 1992 because of intentional discrimination on the
basis of race, color or national origin. This argument
has two points. First, Nash Finch argues instruction No.
12 incorrectly permitted the jury to find in favor of Kim
if it found only that Nash Finch’s asserted legitimate,
nondiscriminatory reason for not promoting him was false.
Nash Finch argues that the instruction failed to require
the jury to find that the asserted reason was a pretext
for intentional discrimination. Nash Finch also argues
there was insufficient evidence of intentional
discrimination, that is, that it failed to promote Kim
because of race, color or national origin. In sum, Nash
Finch argues that Kim failed to show that its articulated
legitimate, nondiscriminatory reason was false and that,
even assuming it was false, such a finding alone cannot
-17-
support a finding of intentional discrimination. Nash
Finch’s argument correctly states the applicable law;
however, we hold the instruction was not erroneous and the
evidence was sufficient to support the jury’s verdict that
Nash Finch intentionally discriminated against Kim.
The analysis applicable to Title VII disparate
treatment and 42 U.S.C. § 1981 claims in employment cases
is the familiar three-part framework initially set out in
-18-
McDonnell Douglas Corp. v. Green, 411 U.S. 792, 800-06
(1973) (McDonnell Douglas), and further refined in Supreme
Court cases, most recently St. Mary’s Honor Center v.
Hicks, 509 U.S. 502 (1993) (Hicks). This court recently
clarified the analysis in Ryther v. KARE 11, 108 F.3d 832,
836 (8th Cir.) (banc) (Ryther), cert. denied, 117 S.Ct.
2510 (1997). The elements of a Title VII disparate
treatment claim and a § 1981 claim are identical. Hicks,
509 U.S. at 506 n.1 (noting McDonnell Douglas framework
also applies to claims of purposeful employment
discrimination on the basis of race under 42 U.S.C. §
1983). First, the plaintiff must establish a prima facie
case. Second, if the plaintiff establishes a prima facie
case, the defendant must “rebut the presumption of
discrimination [raised by the prima facie case] by
producing evidence that the plaintiff was rejected, or
someone else was preferred, for a legitimate,
nondiscriminatory reason.” Texas Department of Community
Affairs v. Burdine, 450 U.S. 248, 254 (1981) (Burdine)
(noting the employer must only articulate legitimate,
nondiscriminatory reason, but need not persuade the
factfinder that it was actually motivated by the proffered
reasons). Third, if the defendant carries this burden,
the plaintiff is entitled to the opportunity to show that
the defendant’s articulated reason was in fact “not the
true reason for the employment decision” and a “pretext
for discrimination.” Id. at 256; see Hicks, 509 U.S. at
216 & n.6 (“pretext for discrimination” means both that
the proffered reason was false and that discrimination was
the real reason).
“This burden [of demonstrating that the proffered
reason was not the true reason for the employment
-19-
decision] now merges with the ultimate burden of
persuading the [trier of fact] that [the plaintiff] has
been the victim of intentional discrimination.” Burdine,
450 U.S. at 256. The plaintiff can establish that he or
she has been the victim of intentional discrimination
“either directly by persuading the [trier of fact] that a
discriminatory reason more likely motivated the employer
or indirectly by showing that the employer’s proffered
explanation is unworthy of credence.” Id.
-20-
The factfinder’s disbelief of the reasons put
forward by the defendant (particularly if
disbelief is accompanied by a suspicion of
mendacity) may, together with the elements of
the prima facie case, suffice to show
intentional discrimination. Thus, rejection of
the defendant’s proffered reasons, will permit
the trier of fact to infer the ultimate fact of
intentional discrimination, and . . . , upon
such rejection, “[n]o additional proof of
discrimination is required.”
Hicks, 509 U.S. at 511 (footnote omitted).
Thus, according to Hicks, when the
plaintiff’s evidence . . . challenges the
defendant’s articulated nondiscriminatory
reason, such evidence may serve as well to
support a reasonable inference that
discrimination was a motivating reason for the
employer’s decision. As the Supreme Court has
observed, “when all legitimate reasons for
rejecting an applicant have been eliminated as
possible reasons for the employer’s actions, it
is more likely than not the employer, who we
generally assume acts only with some reasons,
based [its] decision on an impermissible
consideration such as [race].”
. . . .
In sum, when the employer produces a
nondiscriminatory reason for its actions, the
prima facie case no longer creates a legal
presumption of unlawful discrimination. The
elements of the prima facie case remain,
however, and if they are accompanied by evidence
[showing that the defendant’s proffered
explanation is false] and disbelief of the
defendant’s proffered explanation, they may
permit the jury to find for the plaintiff. This
-21-
is not to say that, for the plaintiff to
succeed, simply proving [that the defendant’s
proffered explanation is false] is necessarily
enough. We emphasize that evidence [that the
defendant’s proffered explanation is false] will
not be enough to make a submissible case if it
is, standing alone, inconsistent with a
reasonable inference of [unlawful]
discrimination. [T]he plaintiff must still
persuade the jury, from all the facts and
circumstances, that the employment decision was
based upon intentional discrimination.
-22-
Ryther, 108 F.3d at 836-38 (citation and footnotes
omitted). “Thus, Hicks makes it clear that the plaintiff
must show ‘both that the [proffered] reason was false,
and that discrimination was the real reason.’” Id. at
838 n.5, citing Hicks, 509 U.S. 515. “It is not enough,
in other words, to disbelieve the employer; the
factfinder must believe the plaintiff’s explanation of
intentional discrimination.” Hicks, 509 U.S. at 519.
Jury Instructions
We address the instruction issue first. “[W]e review
the district court’s jury instructions for abuse of
discretion and on review must determine simply ‘whether
the instructions, taken as a whole and viewed in light of
the evidence and applicable law, fairly and adequately
submitted the issues in the case to the jury.’” Karcher
v. Emerson Electric Co., 94 F.3d 502, 510 (8th Cir. 1996)
(citing Sherbert v. Alcan Aluminum Corp., 66 F.3d 965,
968 (8th Cir. 1995)), cert. denied, 117 S. Ct. 1692, 1693
(1997). “[W]e will not find error in instructions simply
because they are technically imperfect or are not a model
of clarity.” Hastings v. Boston Mutual Life Insurance
Co., 975 F.2d 506, 510 (8th Cir. 1992). We will reverse
only if we find that “the jury instructions contained an
error or errors that affected the substantial rights of
the parties.” Id.
Instruction No. 12 provided in part that “[a] false or
pretextual reason for the decision not to promote the
plaintiff is one form of evidence from which you may, but
are not required, to find that the defendant discriminated
against the plaintiff.” Nash Finch argues that this part
of instruction No. 12 improperly permitted the jury to
-23-
find in favor of Kim if it found only that Nash Finch’s
asserted legitimate, nondiscriminatory reason for not
promoting him was false. We disagree because, when read
as a whole, instruction No. 12 correctly set forth the
applicable law. The paragraph immediately preceding the
sentence to which Nash Finch objected provided that “you
may find Defendant Nash Finch intentionally discriminated
against Plaintiff Jin Kim if you reject the Defendant’s
stated reasons for not promoting him and you find
Defendant’s stated reasons for its decision not to promote
Plaintiff were given to hide an intent by Nash
-24-
Finch to discriminate on the basis of his race, color or
national origin.” This part of instruction No. 12
correctly instructed the jury, as required by Hicks, that
it had to find both that the stated reason was false and
that intentional discrimination on the basis of race was
the real reason in order to return a verdict in favor of
Kim, not only that the stated reason was false. Ryther,
108 F.3d at 838 & n.5 (noting Hicks makes it clear that
the plaintiff must show both that the reason was false and
that intentional discrimination was the real reason). The
instructions for the 1990 promotion claim (No. 9) and the
ADEA claim (No. 14) similarly provided that the jury could
find race or age was a determining factor if it found Nash
Finch’s stated reason for its decision was “not the true
reason, but [was] a ‘pretext’ to hide discriminatory
motivation.” These instructions correctly premised
liability on a finding of discrimination and not merely on
a finding that Nash Finch’s proffered reason was false.
Sufficiency of the evidence-- failure to promote
Next, we address the sufficiency of the evidence.
Nash Finch argues that it is entitled to judgment as a
matter of law because Kim failed to make a submissible
case that racial discrimination motivated the decisions
not to promote him. Nash Finch argues that there was
evidence that its proffered reason was false but no
evidence of racial discrimination. We disagree.
“[W]e will not reverse a jury’s verdict for
insufficient evidence unless, after viewing the evidence
in the light most favorable to the verdict, we conclude
that no reasonable juror could have returned a verdict for
the non-moving party.” Ryther, 108 F.3d at 836. Our role
-25-
on appeal is to determine whether there is an evidentiary
basis for the jury’s verdict. Id. at 844-45. “[W]hen
that evidentiary basis becomes apparent, it [is]
immaterial that the court might draw a contrary inference
or feel that another conclusion is more reasonable.”
Lavender v. Kurn, 327 U.S. 645, 653 (1946). “Whether an
issue was properly before the jury, however, is a legal
question which is
-26-
reviewed de novo.” Kimzey v. Wal-Mart Stores, Inc., 107
F.3d 568, 573 (8th Cir. 1997) (citation omitted).
We have reviewed the evidence in the light most
favorable to Kim as the prevailing party, assumed that all
conflicts in the evidence were resolved in his favor,
assumed as proved all facts that his evidence tended to
prove, and given him the benefit of all reasonable
inferences that may reasonably be drawn from the facts
proved. We hold the record as a whole-- specifically, the
combination of the undisputed evidence as to the elements
of the prima facie case and the strong evidence that Nash
Finch’s proffered reason was false, which, when considered
with the strong evidence of retaliation-- clearly provided
sufficient evidence as a matter of law to allow the jury
to find Nash Finch intentionally discriminated against Kim
on the basis of race in failing to promote him. This
reasonable inference is the logical result of the
application to the evidence of the McDonnell Douglas
analytical framework for the allocation of the burden of
production and the order for the presentation of proof.
It was not disputed that Kim established a prima facie
case: (1) Kim was a member of a racial minority, (2) he
was qualified for promotion, (3) he was not promoted, and
(4) Nash Finch promoted a non-minority. The prima facie
case created a legal presumption of unlawful
discrimination. Because Nash Finch articulated
nondiscriminatory reasons for promoting someone else, the
legal presumption of unlawful discrimination, created by
the prima facie case, then dropped out of the case.
However, the elements of the prima facie case remained in
the case. The evidence refuted Nash Finch’s articulated
nondiscriminatory reasons and strongly suggested that Nash
-27-
Finch had lied about those reasons. Nash Finch conceded
at trial that Kim was qualified for promotion but argued
the successful candidates were better qualified. There
was evidence that Kim was relatively better qualified for
promotion in terms of education, seniority and supervisory
experience than the successful candidates. There was also
evidence from which the jury could conclude that Nash
Finch’s managers were not particularly credible. Mund
initially told Kim that the 1990 promotion had
-28-
been made at a higher level even though Mund had made the
decision himself. Mund then told Kim that he had not been
promoted because he was not qualified. However, Mund
testified at trial that he never seriously considered Kim
for promotion because Kim lacked personal loyalty to him
(Mund).
The evidence challenged Nash Finch’s articulated
nondiscriminatory reasons for not promoting Kim and
supported a reasonable inference that unlawful
discrimination was a motivating reason for Nash Finch’s
failure to promote Kim. This evidence was sufficient to
permit the jury to infer the ultimate fact of intentional
discrimination. Hicks, 509 U.S. at 511; Ryther, 108 F.3d
at 836-37. This is because “when all legitimate reasons
for rejecting an applicant have been eliminated as
possible reasons for the employer’s actions, it is more
likely than not the employer, who we generally assume acts
only with some reasons, based [its] decision on an
impermissible consideration such as race.” Furnco
Construction Co. v. Waters, 438 U.S. 567, 577 (1978).
This is not a case in which the evidence showing the
employer’s proffered reason was false was inconsistent
with a reasonable inference of unlawful discrimination.
Here, Nash Finch contended the real reason Kim was not
promoted was that the successful candidates were better
qualified. Kim’s evidence showed that the proffered
reason was false; it did not show that some reason other
than unlawful discrimination was the real reason he was
not promoted. See Ryther, 108 F.3d at 837 n.4 (discussing
cases in which evidence showing employer’s proffered
reason was false was inconsistent with reasonable
inference of unlawful discrimination and citing Rothmeier
v. Investment Advisers, Inc., 85 F.3d 1328, 1337 (8th Cir.
-29-
1996) (evidence showed real reason for discharge was
confrontation about SEC violations), Barber v. American
Airlines, Inc., 791 F.2d 658, 660 (8th Cir.) (evidence
showed real reason for disparate treatment was not age
discrimination), cert. denied, 479 U.S. 885 (1986), and
Visser v. Packer Engineering Assocs., 924 F.2d 655, 657
(7th Cir. 1991) (banc) (explaining “pretext” in employment
law means a reason that employer offers for action claimed
to be discriminatory and that factfinder disbelieves,
allowing inference that employer is trying to conceal a
discriminatory reason and not some other unethical
-30-
reason or even a mask for such a reason; evidence showed
that plaintiff was fired because he was disloyal to CEO;
thus real, albeit unethical, reason for firing was not age
discrimination but plaintiff’s loyalty to company rather
than to CEO personally)).
In addition to the elements of the prima facie case
and the evidence showing Nash Finch’s proffered reason was
false, there was also evidence that, out of more than
3,500 employees, only 2 management employees in 25 years
were non-white. Those employees were not warehouse
supervisory employees; they were assistant retail grocery
store managers. There was also evidence that the only
Asian-American employee at the Cedar Rapids warehouse
other than Kim was employed as a janitor. There was also
some evidence that Nash Finch disciplined Kim more
severely than non-Asian employees for comparable incidents
and that the disciplinary action was in retaliation for
his filing discrimination charges. As noted above, direct
evidence of intentional discrimination was not required;
case law recognizes that intentional discrimination may be
proven by circumstantial evidence because “[t]here will
seldom be ‘eyewitness’ testimony as to the employer’s
mental processes.” United States Postal Service Board of
Governors v. Aikens, 460 U.S. 711, 714 n.3 (1983). “After
all, the McDonnell Douglas framework exists to provide
discrimination plaintiffs a way to prove their case when
they do not have ‘explicit, inculpatory evidence of
discriminatory intent.’” Shannon v. Ford Motor Co., 72
F.3d 678, 682 (8th Cir. 1996), citing Hutson v. McDonnell
Douglas Corp., 63 F.3d 771, 776 (8th Cir. 1995).
In sum, the record as a whole in this case-- the
evidence showing that Nash Finch’s proffered reason was
false, plus the evidence establishing the elements of the
-31-
prima facie case-- was sufficient to permit the jury
reasonably to find that Nash Finch intentionally
discriminated against Kim on the basis of race in refusing
to promote him to shipping foreman in November 1990 and in
April 1992. Consistent with Hicks, no additional evidence
of discrimination was required. The evidence in this case
presented inconsistent inferences to the jury, and the
resolution of this conflicting evidence was a matter for
the jury to resolve. E.g., Ryther, 108 F.3d at 845
(citing cases). The
-32-
district court did not err in denying Nash Finch’s motion
for judgment as a matter of law on the discrimination
claims.
RETALIATION
Nash Finch next argues Kim failed to make a
submissible retaliation claim. Nash Finch argues that, as
a matter of law, Kim suffered no adverse employment action
because he was not demoted, terminated, reassigned, or
suspended, did not lose any compensation or privileges,
and in fact is still employed by Nash Finch. Nash Finch
also argues that, assuming there was an adverse employment
action, there was no evidence of a causal relationship
between to Kim’s filing a race discrimination charge and
any adverse employment action. Nash Finch also argues
that any adverse employment action was justified under the
circumstances.
Like the substantive claim of racial discrimination,
a claim of retaliation, in a racial discrimination
context, can violate both Title VII and 42 U.S.C. § 1981.
Setser v. Novack Investment Co., 638 F.2d 1137, 1146-47
(8th Cir. 1981) (Setser) (subsequent history omitted)
(holding retaliation by employer against plaintiff for
filing race-based EEOC complaint would be based on racial
discrimination for purposes of 42 U.S.C. § 1981 claim);
see also Greenwood v. Ross, 778 F.2d 448, 455-56 (8th Cir.
1985); Sisco v. J.S. Alberici Construction Co., 655 F.2d
146, 150 (8th Cir. 1981) (applying Setser), cert. denied,
455 U.S. 976 (1982). We apply the same McDonnell Douglas
analytical framework to a retaliation claim under § 1981
and Title VII. See, e.g., Evans v. Kansas City, Missouri,
School District, 65 F.3d 98, 101 (8th Cir. 1995) (§ 1981
-33-
retaliation claim), cert. denied, 116 S. Ct. 1319 (1996);
Kobrin v. University of Minnesota, 34 F.3d 698, 704 (8th
Cir. 1994) (Title VII retaliation claim) (Kobrin). The
elements of a retaliation claim under § 1981 and Title VII
are (1) protected activity, (2) subsequent adverse
employment action, and (3) a causal relationship between
the two. See Barge v. Anheuser-Busch, Inc., 87 F.3d 256,
259 (8th Cir. 1996) (§ 1981 retaliation claim); Kobrin, 34
F.3d at 704 (Title VII retaliation claim).
-34-
Adverse employment action
Nash Finch argues that the district court erred in
denying its motion for judgment as a matter of law because
Kim failed to show any adverse employment action. Nash
Finch argues Kim was not demoted, terminated, reassigned,
or suspended, did not lose any compensation or privileges,
and in fact is still employed by Nash Finch. We hold Nash
Finch’s actions did rise to the level of adverse
employment action.
Typically, it is obvious whether an employer took
adverse employment action when, for example, the employee
has been terminated or discharged. However, retaliatory
conduct may consist of “action less severe than outright
discharge.” Dortz v. City of New York, 904 F. Supp. 127,
156 (S.D.N.Y. 1995) (allegations that employer’s actions
disadvantaged and interfered with employee’s ability to
perform her job). What happened to Kim was much “‘more
disruptive than a mere inconvenience or an alteration of
job responsibilities’ [or] [c]hanges in duties or working
conditions that cause no materially significant
disadvantage.” Harlston v. McDonnell Douglas Corp., 37
F.3d 379, 382 (8th Cir. 1994) (citation omitted) (no
adverse employment action where plaintiff was reassigned
without diminution in title, salary or benefits); see
Thomas v. St. Luke’s Health Systems, Inc., 869 F. Supp.
1413, 1435 (S.D. Iowa 1994) (holding employer’s initial
demands that employee take drug test, which was
subsequently withdrawn, and accept another position had no
impact on continued employment and did not rise to level
of adverse employment action), aff’d, 61 F.3d 908 (8th
Cir. 1995) (table) (No. 94-4081). Kim’s duties had been
reduced; he received much lower performance evaluations
-35-
than he had received before filing his employment
discrimination charge; he was required to undergo special
remedial training. There was also evidence that Nash
Finch had “papered” his personnel file with negative
reports, including two written reprimands. These are the
kind of serious employment consequences that adversely
affected or undermined Kim’s position, even if he was not
discharged, demoted or suspended.
-36-
In any event, we need not decide in the present case
whether each act in itself constituted actionable “adverse
employment action” because Kim essentially claimed that
Nash Finch had systematically retaliated against him, that
is, that all the acts were taken in response to his filing
the employment discrimination charge and were thus
connected to one another. Cf. Caliendo v. Bentsen, 881 F.
Supp. 44, 48 (D.D.C. 1995) (alleging personnel actions
such as removal from undercover operation, failure to
receive monetary award, removal as acting group
supervisor, receipt of letter of reprimand, etc.
constituted series of adverse employment actions in
retaliation for EEOC activities). We hold that, as a
matter of law, Nash Finch’s conduct, which included
reduction of duties, disciplinary action and negative
personnel reports, as well as required remedial training,
constituted adverse employment action.
Sufficiency of the evidence
Nash Finch also argues that the district court erred
in denying its motion for judgment as a matter of law
because there was no evidence of a causal connection
between Kim’s filing a race discrimination charge and any
adverse employment action and that any adverse employment
action was justified under the circumstances. We have
reviewed the evidence in the light most favorable to Kim
as the prevailing party, assumed that all conflicts in the
evidence were resolved in his favor, assumed as proved all
facts that his evidence tended to prove, and given him the
benefit of all reasonable inferences that may reasonably
be drawn from the facts proved. We hold the record as a
whole-- specifically, the elements of the prima facie case
and the evidence showing that Nash Finch’s proffered
-37-
reason was false-- provided a sufficient basis from which
reasonable jurors could find that Nash Finch retaliated
against Kim for filing an employment discrimination
charge. This permissible inference is the logical result
of the application to the evidence of the McDonnell
Douglas analytical framework for the allocation of the
burden of production and the order for the presentation of
proof.
-38-
Filing an employment discrimination charge is activity
protected by Title VII, §704(a), 42 U.S.C. § 2000e–3(a).
Nash Finch knew in May 1992 that Kim had filed an
employment discrimination charge. In fact, Nash Finch
justified disclosure of Kim’s personnel file, which
contained a report of a disciplinary action based on a
race-related incident, as part of its response to the
local civil rights commission investigation. Kim had
received high performance evaluations and had had no
disciplinary problems. However, after Kim filed the
employment discrimination charge, his Saturday and fill-in
shipping foreman duties were immediately eliminated, he
began to receive markedly lower performance evaluations,
he was orally cautioned about a poor attitude toward
management, he was placed under surveillance and excluded
from meetings at work, he was disciplined following a
September 1992 incident in which Nash Finch found Kim had
made racial slurs against a co-worker, and in late 1993 he
was required to participate in special remedial training.
This circumstantial evidence-- that the employer was aware
of the protected activity and that adverse employment
action “followed the protected activity so closely in time
as to justify an inference of retaliatory motive”-- was
sufficient to establish the requisite causal connection
between the protected activity and the adverse employment
action. Rath v. Selection Research, Inc., 978 F.2d 1087,
1090 (8th Cir. 1992); see Kobrin, 34 F.3d at 704; cf.
Barge v. Anheuser-Busch, Inc., 87 F.3d at 259-60 (holding
plaintiff failed to make prima facie case of retaliation
because she produced no evidence connecting her prior EEOC
claim to alleged harassment, denial of assistance with
job-related tasks, or denial of disability benefits).
-39-
Nash Finch defended its post-May 1992 actions as a
legitimate, continuing “dialogue” between an employee and
management about adherence to company work rules and
respect for company equal employment opportunity policies.
However, Kim produced evidence that refuted the negative
reports in his personnel file, including evidence that
Nash Finch had “papered” his personnel file with negative
reports. Some of the negative reports involved petty and
insignificant incidents; however, some of the negative
reports supported Nash Finch’s claim that Kim lacked
management ability and
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had refused opportunities for additional supervisory
responsibility. More seriously, as noted above, there was
evidence that the initial reports about the September 1992
incident did not include any reference to racial
discrimination. However, in November 1992, after Kim had
requested a right-to-sue letter, senior management issued
a written reprimand to Kim about the September 1992
incident. This written reprimand specifically described
the racial context of the incident and stated that the
company would not tolerate discrimination which would be
in violation of Title VII and that Kim’s actions had
probably violated his co-worker’s civil rights. The jury
could have reasonably found that Nash Finch placed the
written reprimand in Kim’s personnel file in order to
discredit Kim when the local civil rights commission was
investigating his employment discrimination charge. There
was also evidence that Nash Finch did not handle in the
same way a similar dispute about work assignments
involving the same co-worker and another foreman and a
complaint about sexual harassment by another employee.
Unlike the incident involving Kim, these incidents did not
result in written reprimands.
In sum, we hold the evidence as a whole-- evidence
that the employer’s proffered reasons were false, as well
as the evidence establishing the elements of the prima
facie case-- was sufficient to permit the jury to find the
ultimate fact of retaliation. Consistent with Hicks, no
additional evidence of retaliation was required. The
evidence in this case presented inconsistent inferences to
the jury, and the resolution of this conflicting evidence
was a matter for the jury to resolve. The district court
did not err in denying Nash Finch’s motion for judgment as
a matter of law on the retaliation claim.
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AMENDMENT OF PLEADINGS
This is Kim’s principal contention on appeal. Kim
argues the district court abused its discretion in denying
his motion to amend his pleadings to conform to the
evidence under Fed. R. Civ. P. 15(b) by adding 42 U.S.C.
§ 1981 as a theory for recovery for the 1992 promotion and
retaliation claims. Nash Finch, however, characterizes
this issue as an instruction issue and argues the
instructions and the special verdict forms submitted the
1992 promotion and retaliation claims to the jury under
Title VII only. Nash Finch argues the district court
correctly concluded that Kim’s failure to object to the
instructions or the special verdict forms under Fed. R.
Civ. P. 51 waived any argument that those claims should
have been submitted to the jury under § 1981 as well as
Title VII.
Whether the 1992 promotion and retaliation claims
should have been (or actually were) submitted to the jury
under § 1981 as well as Title VII is critical because
compensatory and punitive damages are “capped” under Title
VII but not under §1981. Thus, under Title VII, Kim’s
compensatory and punitive damages would be limited to
$300,000, but the amount of damages could be much greater
under § 1981. (The jury awarded Kim a total of $8,650,000
for compensatory and punitive damages for the 1992
promotion and retaliation claims.) This is because 42
U.S.C. § 1981a(b)(3)-- the statutory cap-- limits the
amount of any award of compensatory and punitive damages
for Title VII claims for intentional discrimination. Cf.
Kimzey v. Wal-Mart Stores, Inc., 107 F.3d at 575-76
(applying statutory cap to Title VII claims but not to
state anti-discriminatory claims); Luciano v. Olsten
-42-
Corp., 912 F. Supp. 663, 675 (E.D.N.Y. 1996) (same),
aff’d, 110 F.3d 210 (2d Cir. 1997).4 However, the Title
VII statutory cap does not apply to § 1981 claims; the
1991 Civil Rights Act, which made
4
The Iowa civil rights statute does allow for compensatory damages but not
punitive damages. E.g., Chauffeurs Local Union No. 238 v. Iowa Civil Rights
Comm’n, 394 N.W.2d 375, 382-84 (Iowa 1986).
-43-
compensatory and punitive damages available under Title
VII, specifically provides that “[n]othing in this section
shall be construed to limit the scope of, or the relief
available under, section 1981 of this title.” 42 U.S.C.
§ 1981a(b)(4); see Johnson v. Metropolitan Sewer District,
926 F. Supp. 874, 876 (E.D. Mo. 1996), citing West v.
Boeing Co., 851 F. Supp. 395, 399-01 & nn.4, 5 & 7 (D.
Kan. 1994) (reviewing legislative history of § 1981a(a)(1)
as expanding remedies available under Title VII for
intentional discrimination); cf. Reynolds v. Octel
Communications Corp., 924 F. Supp. 743, 747 (N.D. Tex.
1995) (holding recovery of both liquidated damages under
ADEA and punitive damages under Title VII would be double
recovery for same conduct); Bradshaw v. University of
Maine System, 870 F. Supp. 406, 407-08 (D. Me. 1994)
(holding plaintiff who could have but did not plead race
discrimination claim under §1981 was not barred from
bringing Title VII race discrimination claim for
compensatory and punitive damages by § 1981a).
As a threshold matter, we do not agree that Kim waived
this argument by failing to object to the instructions or
the special verdict forms. The focus of Kim’s argument is
not on the jury instructions or the special verdict forms
themselves (indeed, Kim argues he had no grounds to object
to the jury instructions or the special verdict forms
because they correctly stated the applicable law), but on
the denial of his motion to amend the pleadings to conform
to the evidence. Cf. City of St. Louis v. Praprotnik, 485
U.S. 112, 119-20 (1988) (holding failure to timely object
to jury instructions was no obstacle to appellate review
of same legal issue raised in motions for summary judgment
and directed verdict). Motions to amend the pleadings to
conform to the evidence under Rule 15(b) can be made at
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any time, even after judgment. If the issue of § 1981
liability was tried by implied consent, the district court
should have considered it raised by the pleadings and
should have allowed amendment upon Kim’s request.
Amendments are allowed when the parties have
had actual notice of an unpleaded issue and have
been given an adequate opportunity to
-45-
cure any surprise resulting from the change in
the pleadings. And, when evidence relating to
issues outside the pleadings is introduced and
tried without objection, the parties will be
deemed to have acquiesced.
Nielson v. Armstrong Rubber Co., 570 F.2d 272, 275 (8th
Cir. 1978) (citations omitted).
An amended complaint that “merely amplifies some
of the allegations that have been proven” should
be allowed. On the other hand, however, a
district court is not required to grant a motion
to amend on the basis of some evidence that
would be relevant to the new claim if the same
evidence was also relevant to a claim originally
pled. The introduction of such evidence does
“not provide the defendant any notice” that the
implied claim was being tried.
Gamma-10 Plastics, Inc. v. American President Lines,
Ltd., 32 F.3d 1244, 1256 (8th Cir. 1994) (citations
omitted), cert. denied, 513 U.S. 1198 (1995).
In the present case, the same evidence relevant to the
new theory of recovery-- § 1981-- was relevant to the
theory of recovery originally pled-- Title VII. This is
because, as discussed above, Title VII and § 1981 set
forth parallel, substantially identical, legal theories of
recovery in cases alleging intentional discrimination in
employment on the basis of race. This is particularly so
after the enactment of the 1991 Civil Rights Act. Before
1991, compensatory and punitive damages were available
under § 1981 but not under Title VII. Among other things,
the 1991 Civil Rights Act expanded the definition of “make
and enforce contracts” in § 1981 to include the terms and
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conditions of employment, including discharge, added the
right to jury trial to Title VII, and, most importantly,
expanded the remedies available to Title VII plaintiffs to
include compensatory damages (for emotional pain,
suffering, mental anguish, etc.) and punitive damages.
Compensatory and punitive damages are only available under
Title VII if the plaintiff cannot recover under § 1981.
42 U.S.C. § 1981a(a)(1). The
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elements of claims alleging disparate treatment on the
basis of race under Title VII and intentional employment
discrimination on the basis of race under § 1981 are
identical. Hicks, 509 U.S. at 506 n.1. The standard for
punitive damages is the same under Title VII, 42 U.S.C. §
1981a(b)(1) (malice or reckless indifference to federally
protected rights), and § 1981. E.g., Kolstad v. American
Dental Ass’n, 323 U.S. App. D.C. 402, 108 F.3d 1431, 1437
(1997) (holding standard of proof for punitive damages
under 42 U.S.C. § 1981a is the same as that previously
established for punitive damages under 42 U.S.C. §§ 1981
and 1983), citing Smith v. Wade, 461 U.S. 30, 56 (1983) (§
1983), and Williamson v. Handy Button Machine Co., 817
F.2d 1290, 1296 (7th Cir. 1987) (§ 1981). The elements of
a retaliation claim under § 1981 and Title VII are the
same as well. See Barge v. Anheuser-Busch, Inc., 87 F.3d
at 259 (§ 1981 retaliation claim); Kobrin, 34 F.3d at 704
(Title VII retaliation claim). However, there are still
differences between the two statutes. They are not
co-extensive in coverage (for example, Title VII does not
cover all employers). Title VII requires exhaustion of
administrative remedies, and the statutes of limitations
are different. Most importantly, the amount of
compensatory and punitive damages is limited under Title
VII but not under § 1981.
“We have held that the admission of evidence bearing
on a pleaded issue cannot form the basis for an amendment
under Rule 15(b) unless the defendant knew of the
plaintiff’s intent to inject the unpleaded issues.”
McLaurin v. Prater, 30 F.3d 982, 986 (8th Cir. 1994). In
the present case there is no doubt that Kim intended the
evidence to support § 1981 in addition to Title VII
because the complaint itself alleged that Nash Finch’s
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conduct had violated both Title VII and § 1981 (as well as
the ADEA and state law). Counts I and II, the
failure-to-promote counts, are broadly stated, but the
parties and the district court treated count I as alleging
the April 1992 failure-to-promote violated Title VII (as
well as the ADEA and state law) and count II as alleging
the November 1990 failure-to-promote violated § 1981.
Count III alleged Nash Finch retaliated against Kim for
filing an administrative charge. The caption and text of
Count I referred to Title VII; the caption and text of
Count II referred to § 1981 expressly and to Title VII by
incorporation (the first paragraph of count II “repleaded”
-49-
the paragraphs of count I; recovery under Title VII for
the November 1990 failure-to-promote was precluded because
Kim did not file his administrative charge within 300
days; the complaint was timely filed (within 2 years) for
purposes of §1981). The caption and text of count III
alleged retaliation in violation of only Title VII
expressly, but, like count II, also incorporated the
previous paragraphs, including the reference therein to §
1981. The allegations in the complaint were sufficient to
put Nash Finch on notice of Kim’s claim that Nash Finch’s
conduct violated both Title VII and § 1981, certainly so
that Nash Finch cannot claim surprise.
In addition, Kim moved several times to amend the
pleadings, in pre-trial proceedings (opposing Nash Finch’s
motion for summary judgment), immediately before trial
began and then during the trial. Each time Kim explained
why he sought to amend the pleadings to add § 1981 as a
theory for recovery for the April 1992 failure-to-promote
and retaliation claims, specifically referring to the
statutory cap on damages under Title VII but not under §
1981. Moreover, on the third day of trial, near the close
of the evidence, in ruling on Kim’s renewed motion, the
district court found that the case had been tried on the
basis of both § 1981 and Title VII and granted the motion
to amend the pleadings to add § 1981 as a theory of
recovery. It was only after the case had been submitted
to the jury (following an extensive instructions
conference during which, among other issues, the standard
of proof for punitive damages under Title VII and § 1981
was discussed) that the district court reconsidered and
then denied the motion to amend the pleadings. It would
seem that if any party was surprised by this turn of
events, it was Kim.
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We think the record shows that, even though § 1981 as
a theory of recovery was not pleaded, it was fairly tried
by the parties. Moreover, because of the substantial
identity of Title VII and § 1981 as theories of recovery
for claims of intentional discrimination, Nash Finch was
not prejudiced by the amendment because it had a fair
opportunity to defend § 1981 as a theory of recovery. We
are satisfied that, given the substantial identity of
Title VII and § 1981 as theories of recovery, the jury’s
finding
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of intentional discrimination under Title VII also
constituted a finding of intentional discrimination under
§ 1981, even though the instructions for the April 1992
promotion and retaliation claims (as well as the punitive
damages instruction) did not refer to §1981. Thus, we
hold the district court abused its discretion in denying
the motion to amend the pleadings to conform to the
evidence. See, e.g., Gamma-10 Plastics, Inc. v. American
President Lines, Ltd., 32 F.3d at 1255-57 (holding abuse
of discretion to deny motion to amend complaint to add
claim for punitive damages under general maritime law);
McLaurin v. Prater, 30 F.3d at 985-86 (suggesting on
remand that district court should grant motion to amend
complaint to add state law claims to constitutional claim
based on same facts); Corsica Livestock Sales, Inc. v.
Sumitomo Bank, 726 F.2d 374, 377-78 (8th Cir. 1983)
(holding abuse of discretion to deny motion to amend
complaint to add contract theory of recovery to rule
violation theory of recovery alleged in complaint);
Nielson v. Armstrong Rubber Co., 570 F.2d at 275-76
(holding abuse of discretion to deny motion to amend
complaint to add strict products liability claim to
negligence claim already alleged); cf. Oglala Sioux Tribe
v. Andrus, 603 F.2d 707, 714 (8th Cir. 1979) (noting
federal rules abolished “theory of the pleadings” doctrine
under which plaintiff must succeed on those theories that
are pleaded or not at all).
Because § 1981 was a basis for recovery, the Title VII
cap on compensatory and punitive damages does not apply.
We turn next to Nash Finch’s damages arguments.
COMPENSATORY DAMAGES
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Nash Finch argues there was no evidence to support the
award of $21,000 in back pay (lost wages). Nash Finch
argues that the difference in pay between what Kim was
paid as a leadman and what he would have been paid had he
been promoted to foreman was at most $1932.81. Nash Finch
bases this calculation on the salaries paid to the two
employees who were promoted to the position of shipping
foreman in 1990 and 1992. We hold there was evidence to
support the award of $21, 000 in back pay.
-53-
Kim presented evidence showing that the salaries of
comparable employees and evidence that there was no set
pay scale for the position, that Nash Finch considered a
number of facts in setting salaries, and that he had more
seniority and more experience in the shipping department
(including experience as the Saturday shipping foreman)
than the two individuals who were promoted in 1990 and
1992.
Nash Finch also argues there was no evidence to
support the award of $447 per month in front pay. Nash
Finch argues that at most the difference in pay was about
$360 per month. Nash Finch bases this calculation on the
higher of the salaries paid to the two employees who were
promoted to the position of shipping foreman in 1990 and
1992. (The lower difference in salary was about $240 per
month.) The district court based the amount of the front
pay award on the back pay award ($21,000 over 47 months
(from November 1990 promotion to September 1994 verdict),
or $447 per month). Slip op. at 16-19, 21. We have
already held that the district court’s calculation of back
pay is supported by substantial evidence, and we cannot
disapprove of the calculation of front pay based on the
same evidence.
Nash Finch also argues there was no medical or other
expert testimony to support the finding of emotional
distress. The jury awarded Kim $ 100,000 for mental
anguish and loss of enjoyment of life caused by the
November 1990 failure-to-promote under 42 U.S.C. § 1981.
Medical or other expert evidence is not required to prove
emotional distress. Turic v. Holland Hospitality, Inc.,
85 F.3d 1211, 1215 (6th Cir. 1996) (Title VII). “A
plaintiff’s own testimony, along with the circumstances
-54-
of a particular case, can suffice to sustain the
plaintiff’s burden in this regard.” Id. at 1215-16
(citing cases); see, e.g., Wilmington v. J.I. Case Co.,
793 F.2d 909, 922 (8th Cir. 1986) (42 U.S.C. § 1981)
(testimony of plaintiff and other witnesses about
plaintiff’s deterioration in health, mental anxiety,
humiliation, and emotional distress resulting from
working conditions and discharge); Williams v. Trans
World Airlines, Inc., 660 F.2d 1267, 1272-73 (8th Cir.
1981) (testimony of plaintiff about humiliation or mental
distress); cf. Mardell v. Harleysville Life Insurance
Co., 31 F.3d 1221,
-55-
1232-33 (3d Cir. 1994) (violation of employee rights
frequently results in significant injury to dignity and
demoralizing impairment of self-esteem) (citing cases),
vacated on other grounds, 514 U.S. 1034 (1995); Rush v.
Scott Specialty Gases, Inc., 930 F. Supp. 194, 199 (E.D.
Pa. 1996) (testimony of plaintiff corroborated by
friends, family and expert witnesses, plus evidence of
physical suffering and need for professional care), rev’d
on other grounds, 113 F.3d 476 (3d Cir. 1997). Here,
Kim, his wife and his son testified about the anxiety,
sleeplessness, stress, depression, high blood pressure,
headaches, and humiliation he suffered after he was not
promoted and after he filed the employment discrimination
charge. We hold that medical or other expert evidence
was not required to prove emotional distress and that
there was sufficient evidence of emotional distress.
PUNITIVE DAMAGES
Nash Finch argues the district court erred in
submitting the issue of punitive damages to the jury.
Nash Finch argues the district court should have applied
a heightened standard of proof for punitive damages
because the 1991 Civil Rights Act, 42 U.S.C. §
1981a(b)(1), limits the availability of punitive damages
to “exceptional circumstances of unusual bad motive that
transcends ordinary intentional misconduct.” Brief for
Appellee/ Cross-Appellant at 46.
Under 42 U.S.C. § 1981a(b)(1) a complaining party may
recover punitive damages if the defendant discriminates
“with malice or with reckless indifference to the
federally protected rights of an aggrieved individual.”
We do not agree that the 1991 Civil Rights Act, 42 U.S.C.
-56-
§ 1981a(b)(1), limits the availability of punitive
damages to “exceptional circumstances of unusual bad
motive that transcends ordinary intentional misconduct.”
The Second Circuit rejected a similar argument in Luciano
v. Olsten Corp., 110 F.3d at 219-20. In that case the
employer argued punitive damages required
“extraordinarily egregious” conduct. The court held that
“[n]othing in the . . . text [of § 1981a(b)(1)] indicates
that a heightened standard was meant to
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apply to Title VII cases.” Id. at 220, citing Rowlett v.
Anheuser-Busch, Inc., 832 F.2d 194, 205 (1st Cir. 1987)
(punitive damages under 42 U.S.C. § 1981 available where
defendant’s conduct is motivated by evil motive or
involves reckless indifference to federally protected
rights), Beauford v. Sisters of Mercy-Province of
Detroit, Inc., 816 F.2d 1104, 1108-09 (6th Cir.) (same),
cert. denied, 484 U.S. 913 (1987), and Smith v. Wade, 461
U.S. at 55-56 (punitive damages under 42 U.S.C. § 1983
available under common law when conduct motivated by evil
motive or intent or reckless or callous indifference to
federally protected rights of others); accord Kolstad v.
American Dental Ass’n, 108 F.3d at 1437-39. The court
also noted the legislative history indicated that
Congress intended to make punitive damages available
under § 1981a “to the same extent and under the same
standards that they are available to plaintiffs under 42
U.S.C. § 1981.” 110 F.3d at 220, citing 137 Cong. Rec.
H9527 (1991) (statement of Rep. Edwards), and H.R. Rep.
No. 40(II), 102d Cong., 1st Sess. 24 (1991), reprinted in
1991 U.S.C.C.A.N. 717.
For this reason, we hold the district court correctly
rejected Nash Finch’s argument that a plaintiff must
demonstrate something more than that required by the
statute to recover punitive damages, that is, that the
defendant acted “with malice or with reckless
indifference to the federally protected rights of an
aggrieved individual.” 42 U.S.C. § 1981a(b)(1).5
5
We need not decide whether recovery of punitive damages under Title VII
requires a “heightened” showing beyond intentional discrimination (that is, intentional
discrimination based on disparate treatment as opposed to disparate impact), although
the author would suggest that it does not. See 42 U.S.C. § 1981a(d)(2) (defining
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Nash Finch also argues that there was insufficient
evidence to support the punitive damages award. Nash
Finch argues there was no evidence of willfulness, malice
or reckless indifference to the federally protected
rights of others, much less “exceptional circumstances of
unusual bad motive that transcends ordinary intentional
misconduct.” Nash Finch argues that, at most, there was
only circumstantial evidence of discrimination consisting
of “inconsistent explanations for the allocation of
scarce employment opportunity.” We hold that there was
sufficient evidence to support the punitive damages
award.
Based on the record as discussed above, a reasonable
jury could have found that Nash Finch acted with reckless
indifference to Kim’s federally protected rights. There
was evidence that Nash Finch knew what constituted
unlawful employment practices. There was also evidence
that Nash Finch systematically retaliated against Kim for
filing an employment discrimination charge and attempted
to discredit him by “papering” his personnel file. The
intentional discrimination at issue-- failure to promote
“discriminatory practice” to mean disparate treatment and not disparate impact); cf.
Rowlett v. Anheuser-Busch, Inc., 832 F.2d 194, 205-06 (1st Cir. 1987) (rejecting in
pre-1991 Civil Rights Act case argument that punitive damages under § 1981 requires
“aggravating circumstances” or “extraordinary or outrageous” misconduct, noting that
it cannot really be disputed that intentional discrimination on basis of race is “worthy
of some outrage”). But see Varner v. National Super Mkts, Inc., 94 F.3d 1209, 1214
(8th Cir. 1996) (citing with approval Pandazides v. Virginia Bd. of Educ., 13 F.3d 823,
830 n.9 (4th Cir. 1994) (construing “heightened” showing necessary to recover punitive
damages under §1981a(b)(1)), cert. denied, 117 S. Ct. 946 (1997); Karcher v. Emerson
Elec. Co., 94 F.3d 502, 509 (8th Cir. 1996) (same), cert. denied, 117 S. Ct. 1692, 1693
(1997).
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and retaliation-- involved disparate treatment, not
disparate impact, and was undertaken by supervisors or
management. “The requisite level of recklessness or
outrageousness [required to support punitive damages] can
be inferred from management’s participation in the
discriminatory conduct.” Kimzey v. Wal-Mart Stores, Inc.,
107 F.3d at 575, citing Kientzy v. McDonnell Douglas
Corp., 990 F.2d 1051, 1062 (8th Cir. 1993). Direct
evidence of intentional discrimination is not required;
circumstantial evidence may be sufficient. United States
Postal Service Board of Governors v. Aikens, 460 U.S. at
714 n.3. Finally, the record contained more than merely
evidence of inconsistent explanations for Nash Finch’s
conduct, that is, that Nash Finch had lied;
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as discussed above (at some length), there was also
evidence that Nash Finch had intentionally discriminated
against Kim on the bases of race or national origin.
EXCESSIVE VERDICT
Finally, Nash Finch argues the verdict was
unreasonable because it was grossly excessive and grossly
disproportionate to the kind of wrong and the actual
damages. Nash Finch argues that the jury awarded $36,000
for back pay even though the difference in actual wages
was less than $2,000, more than $1.5 million for emotional
distress even though Kim continued to work and lead a
normal life, and $7 million for punitive damages, an
amount which is 3,500 times the actual loss of $2,000 and
almost half of Nash Finch’s annual earnings. Brief for
Appellee/ Cross-appellant at 48; Reply Brief for Appellee/
Cross-appellant at 21 (citing Plaintiff’s Ex. 26 at 2).
Because the district court applied the Title VII
statutory cap, the district court limited the jury’s award
of $150,000 in compensatory damages for emotional distress
for the 1992 failure-to-promote claim, the $1.5 million in
compensatory damages for emotional distress for the
retaliation claim, and the $7 million in punitive damages
to a total of $ 300,000, slip op. at 15-16, and did not
“engage in an analysis as to the excessiveness of the
award except to say that damages in the amount being
awarded are certainly not excessive due to the length of
time the discrimination continued, the level of
retaliation by Nash Finch and the financial well-being of
Nash Finch.” Id. at 14. Thus, as reduced by the district
court, the judgment awarded Kim damages in the amount of
$21,000 for lost wages, $100,000 for emotional distress
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for the 1990 failure-to-promote claim and $300,000,
including punitive damages, for the 1992
failure-to-promote and retaliation claims. Id. at 27.
As discussed above, because the district court abused
its discretion in denying the Rule 15(b) motion to amend,
42 U.S.C. § 1981 was a basis of recovery for the 1992
failure-to-promote and retaliation claims. Because the
Title VII statutory cap does not
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apply to limit the recovery under 42 U.S.C. § 1981, the
district court should not have reduced the amount of
damages awarded pursuant to the Title VII statutory cap.
See 42 U.S.C. § 1981a(b)(4); Johnson v. Metropolitan Sewer
District, 926 F. Supp. at 876. Nonetheless, we think the
district court was correct to reduce the amount of damages
awarded by the jury because the amount was grossly
excessive. In effect, what the district court did
amounted to remittitur, which we review for clear abuse of
discretion. See, e.g., Kientzy v. McDonnell Douglas
Corp., 990 F.2d at 1062. It is not possible to ascertain
what portion of the $300,000 is attributable to
compensatory or punitive damages, so we will assume for
purposes of analysis that the entire amount was for
punitive damages.
After carefully reviewing the evidence, we conclude
that, although an award of $1.75 million for emotional
distress is grossly excessive, an award of $100,000 is
not. See Kimzey v. Wal-Mart Stores, Inc., 107 F.3d at 570
($35,000); Turic v. Holland Hospitality, Inc., 85 F.3d at
1215-16 (listing cases in which damages for emotional
distress ranged from $40,000 to $150,000); Kientzy v.
McDonnell Douglas Corp., 990 F.2d at 1054 ($150,000); Rush
v. Scott Specialty Gases, Inc., 930 F. Supp. at 199
($100,000).
Similarly, we conclude that, although an award of $7
million for punitive damages is grossly excessive, an
award of $300,000 is not. Factors to consider in
determining the reasonableness of a punitive damages award
include the degree of reprehensibility of the defendant’s
conduct, the ratio or relationship between the actual harm
inflicted on the plaintiff and the punitive damages award,
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and civil penalties authorized or imposed for comparable
misconduct. BWM of North America, Inc. v. Gore, 116 S.
Ct. 1589, 1598-99 (1996); see Pulla v. Amoco Oil Co., 72
F.3d 648, 659 (8th Cir. 1995) (White, J.). Nash Finch’s
conduct was reprehensible and involved retaliation and at
least reckless disregard of federal protected rights. It
did not involve violence or the threat of violence, but it
did involve trickery or deceit. The ratio or relationship
between the reduced punitive damages award and the actual
harm inflicted
-64-
as measured by the reduced amount of back pay and
compensatory damages is a relatively unremarkable 3:1.
See BMW of North America, Inc. v. Gore, 116 S. Ct. at 1602
(noting 4:1 ratio of punitive damages to compensatory
damages was described as “close to the line” in Pacific
Mutual Life Insurance Co. v. Haslip, 499 U.S. 1, 23-24
(1991), and that relevant ratio was not more than 10:1 in
TXO Production Corp. v. Alliance Resources Corp., 509 U.S.
443, 462 (1993)); Kimzey v. Wal-Mart Stores, Inc., 107
F.3d at 577-78 (reducing punitive damages award from $5
million to $350,000, an amount 10 times the actual damages
award of $35,000, which the court described as “low”).
Finally, Title VII, which authorizes or imposes liability
for comparable misconduct, caps compensatory and punitive
damages at $300,000 (for the largest employers). 42
U.S.C. § 1981a(b)(3)(D); see, e.g., Rush v. Scott
Specialty Gases, Inc., 930 F. Supp. at 202 (reducing
punitive damages award from $3 million to $300,000). We
think a $300,000 punitive damages award is an adequate
sanction and sufficient to deter future similar conduct,
considering the size and assets of Nash Finch.
CONCLUSION
In sum, we hold the district court should have granted
the motion to amend the pleadings to conform to the
evidence and thus should not have applied the Title VII
cap, 42 U.S.C. § 1981a(b)(3), to limit compensatory and
punitive damages. We also hold the district court did not
err in holding the November 1990 failure-to-promote claim
was actionable under 42 U.S.C. § 1981 under Patterson,
there was sufficient evidence of intentional
discrimination and retaliation, and there was sufficient
evidence of malice or reckless indifference to support
-65-
punitive damages. Finally, we hold the awards of back pay
and compensatory and punitive damages, as reduced by the
district court, were supported by sufficient evidence and
were not excessive.
Accordingly, we affirm the judgment of the district
court.
-66-
BEAM, Circuit Judge, concurring in part and dissenting in
part.
I concur in the result reached by the court and in the
opinion of the court except that I do not agree that the
evidence was sufficient to submit the issue of punitive
damages to the jury. Thus, any award for punitive damages
was error. Since, as noted by the court, “[i]t is not
possible to ascertain what portion of the $300,000 [award]
is attributable to compensatory or punitive damages,”
infra at 33, I would assume, for purposes of analysis,
that the entire amount was for compensatory purposes.
Accordingly, my bottom line of damages is the same as that
of the court.
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH
CIRCUIT.
-67-
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201 Cal.App.3d 624 (1988)
247 Cal. Rptr. 620
MARVIN HARRIS, Petitioner,
v.
THE SUPERIOR COURT OF CONTRA COSTA COUNTY, Respondent; THE PEOPLE, Real Party in Interest.
Docket No. A040833.
Court of Appeals of California, First District, Division Two.
May 24, 1988.
*626 COUNSEL
William Everett Glass and Glass & Kramer for Petitioner.
No appearance for Respondent.
John K. Van de Kamp, Attorney General, Steve White, Chief Assistant Attorney General, John H. Sugiyama, Assistant Attorney General, Dane R. Gillette and Landra E. Rosenthal, Deputy Attorneys General, for Real Party in Interest.
OPINION
BENSON, J.
Petitioner Marvin Harris seeks a writ of mandate to compel respondent superior court to vacate its order denying petitioner's motion to *627 strike the special circumstances alleged pursuant to Penal Code section 190.2, subdivisions (a)(17)(i) and (ii).[1]
On June 10, 1981, a verified information was filed charging petitioner with the murder of June Azevedo on January 19, 1981. (Pen. Code, § 187.) The information also specially alleged that the murder occurred during the commission of a robbery in violation of section 211 and a kidnapping in violation of sections 207 and 209. The information contained no charges of the substantive offenses of robbery and/or kidnapping.
On January 16, 1984, a jury found petitioner guilty of murder and found the special circumstances true. Petitioner's conviction was reversed by this court on June 16, 1987. (People v. Harris (1987) 192 Cal. App.3d 943 [237 Cal. Rptr. 747].)
On November 16, 1987, petitioner moved to strike the special circumstance allegations in the information on the grounds that the statute of limitations had run on the underlying felonies. Real party then filed its opposition to petitioner's motion and at the same time asked leave to file an amended information which charged the underlying felonies as separate substantive counts. Following a hearing on the matter, respondent court issued an order denying petitioner's motion and granting the People's motion to file an amended information. This petition followed.
Amendment of Information
(1) Petitioner first maintains that the district attorney may not amend the information to allege felonies as separate substantive counts which are barred by the statute of limitations. We agree.
Section 1009[2] provides that the district attorney can amend the charges originally filed at any time, including "on remand after reversal." (People v. Chadd (1981) 28 Cal.3d 739, 758 [170 Cal. Rptr. 798, 621 P.2d 837].) However, when amending an information, a critical inquiry must be made: is the amendment to correct a defect or insufficiency in the original complaint or is the amendment to charge an offense not attempted to be charged by the original complaint? "If the amendment falls in the former category, it *628 relates back to the date of the original filing of the information and has the effect of tolling the running of the statute of limitations from the date of the filing of the original information. [Citation.] If the amendment falls in the latter category, the ... statute of limitations on the charges has run" (Patterson v. Municipal Court (1971) 17 Cal. App.3d 84, 88 [94 Cal. Rptr. 449]) and the charges are barred. Consequently, case law has held that after the statute of limitations has run, an information may not be amended to insert a charge which is not a necessarily included offense, even though it relates to the same conduct as was originally charged. (People v. Chapman (1975) 47 Cal. App.3d 597, 602-606 [121 Cal. Rptr. 315]; People v. McKay (1979) 97 Cal. App.3d Supp. 59, 67 [159 Cal. Rptr. 174].)
Real party relies on People v. Chadd, supra, 28 Cal.3d at page 758, for the proposition that when a reviewing court reverses a judgment and remands the case the parties may amend the pleadings. However, its reliance on Chadd is misplaced. In Chadd, the court permitted amendment to add allegations tolling the statute of limitations, since such allegations did not change the offense charged.
In the instant case, the prosecution is attempting to charge wholly new counts, which, although possibly related to the same conduct as was originally charged, are not necessarily included offenses. Defendant was never charged with the substantive offenses of robbery and/or kidnapping in the original information. Since the statute of limitations has run on violations of sections 211 and 207, no amendment to permit the charging of those offenses may be permitted now.
Amendment to Allege Violation of Section 209
(2) Section 799 provides that there is no time within which a violation of section 209 (kidnapping for the purpose of robbery) must be brought. However, petitioner asserts that the information cannot be amended to allege a section 209 violation because he was acquitted of this charge. The assertion is based on the theory that one of the two special circumstances alleged was that the murder was committed during the commission of a kidnapping in violation of sections 207 and 209. The verdict of the jury included a finding that the murder had been committed during the commission of a robbery and a separate finding that the murder had been committed during the commission of a kidnapping. There was no separate finding that the murder had been committed during the commission of a kidnapping for the purpose of robbery. Petitioner claims that the failure to make such a finding indicates the jury impliedly found that the murder was not committed during a kidnapping for the purpose of robbery. He then maintains that retrial of special circumstances based on a violation of section 209 *629 is barred by principles of double jeopardy. (See People v. McDonald (1984) 37 Cal.3d 351, 378-379 [208 Cal. Rptr. 236, 690 P.2d 709, 46 A.L.R.4th 1011].) The record fails to support petitioner's claim.
Both the original complaint and information charged petitioner with murder during the commission of a kidnapping in violation of sections 207 and 209. The jury was instructed that to find the kidnapping special circumstance true, it must be proved that the murder was committed while the defendant was in the process of committing a "kidnapping to commit robbery." In addition, the jury was instructed on the elements of section 209 kidnapping, and then told that the kidnapping special circumstance could be sustained only if the kidnapping to commit robbery was for a purpose other than to facilitate the murder. There was no instruction of simple kidnapping as a lesser included offense, nor was such an instruction requested. Thereafter, the jury found that the murder was committed during the commission of a kidnapping in violation of section 209. This verdict cannot be deemed ambiguous in view of the fact that the aggravated kidnapping was the only choice given to the jury with respect to the kidnapping special circumstance.
Special Circumstance Allegations
(3a) Having disposed of petitioner's argument that the special circumstance allegation based upon kidnapping for the purpose of robbery is barred by double jeopardy, we must now consider whether special circumstance allegations based upon robbery and simple kidnapping must be striken due to the fact that the statute of limitations has run on the underlying felonies. Relying primarily on section 190.4 and People v. Superior Court (Jennings) (1986) 183 Cal. App.3d 636 [228 Cal. Rptr. 357], petitioner asserts that where the statute has run on the underlying felony, no special circumstance based upon that felony may be alleged. While this proposition is generally correct, it has no application under the circumstances of this case.
Section 190.4 provides in relevant part that "[w]herever a special circumstance requires proof of the commission or attempted commission of a crime, such crime shall be charged and proved pursuant to the general law applying to the trial and conviction of the crime." On the basis of this statute, our Supreme Court has recognized that when a felony-based special circumstance is alleged, the substantive felony must be independently charged and proved. (People v. Robertson (1982) 33 Cal.3d 21, 47 [188 Cal. Rptr. 77, 655 P.2d 279]; People v. Velasquez (1980) 26 Cal.3d 425, 434, fn. 6 [162 Cal. Rptr. 306, 606 P.2d 341], judgment vacated and cause remanded (1980) 448 U.S. 903 [65 L.Ed.2d 1132, 100 S.Ct. 3042], reiterated *630 (1980) 28 Cal.3d 461.) However, the Supreme Court also has held that no prejudice appears where there is a failure to separately charge the underlying felony, since the information notifies the defendant that he must defend against the special circumstances of a murder committed during the commission of a specified felony. (People v. Robertson, supra, 33 Cal.3d at pp. 47-48; People v. Velasquez, supra, 26 Cal.3d at p. 434, fn. 6.)
In People v. Superior Court (Jennings), supra, 183 Cal. App.3d 636, defendants were charged with murder with felony-based special circumstance allegations (count I), robbery (count II) and burglary (count III). However, by the time the information was filed, the statute of limitations had expired for prosecution of the robbery and burglary counts. The defendants demurred to the complaint on the ground that the three-year statute of limitations had run on the substantive charges of robbery and burglary and therefore on the special circumstances allegations as well. The Court of Appeal agreed, stating: "Where, as here, the running of the statute of limitations deprives the court of any power to proceed in the case as to the underlying felonies, and any conviction on those felonies would be invalid and subject to attack, it seems clear that those crimes cannot be `charged and proved pursuant to the general law applying to the trial and conviction of the crime[s]' as required by section 190.4, subdivision (a)." (Id. at p. 644.)
There is a significant difference between Jennings and the case at bench. Whereas in Jennings the statute of limitations had run on the underlying felonies at the time the information was filed, here the special circumstance allegations were timely. (4) (See fn. 3.), (3b) Section 803, subdivision (b)[3] states that "[n]o time during which prosecution of the same person for the same conduct is pending in a court of this state is a part of a limitation of time prescribed in this chapter." Accordingly, the statute of limitations was tolled, at least with respect to the special circumstance allegations in this case, when the original information was filed.
This leaves us with the anomalous situation that the charges for the underlying offenses of robbery and simple kidnapping are time barred whereas special circumstance allegations based upon those felonies are not. However, as our high court has held that the failure to separately charge the underlying felony when a felony-based special circumstance is alleged is not prejudicial, the instant action may proceed in the absence of separate counts for robbery and kidnapping. Petitioner was notified that he had to defend *631 against these special circumstance allegations before the statute had run on the underlying felonies. Thus, he is not prejudiced by having to face retrial with the same charges.
Let a peremptory writ of mandate issue directing the respondent superior court to vacate that portion of its order permitting the district attorney to amend the information to add counts charging substantive offenses based upon violations of sections 211 and 207. In all other respects the petition is denied.
Kline, P.J., and Rouse, J., concurred.
NOTES
[1] All statutory references are to the Penal Code unless otherwise indicated.
[2] Section 1009 states in pertinent part: "The court in which an action is pending may order or permit an amendment of an indictment, accusation or information, or the filing of an amended complaint, for any defect or insufficiency, at any stage of the proceedings, ... A complaint cannot be amended to charge an offense not attempted to be charged by the original complaint, except that separate counts may be added which might properly have been joined in the original complaint."
[3] Neither section 803, subdivision (b), nor its predecessor statute former section 802.5 had been enacted at the time of the commission of petitioner's offense. However, the application of these statutes to crimes committed before their enactment but prior to expiration of the three-year statute does not violate the constitutional prohibition against ex post facto laws. (People v. Sample (1984) 161 Cal. App.3d 1053, 1057 [208 Cal. Rptr. 318].)
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Filed 4/30/14 Cal-Murphy v. MG Restaurants CA21/5
NOT TO BE PUBLISHED IN 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
FIRST APPELLATE DISTRICT
DIVISION FIVE
CAL-MURPHY, LLC ET AL.,
Plaintiffs and Appellants,
A136198, A136854
v. (Consolidated)
MG RESTAURANTS, INC. ET AL.,
(San Francisco County
Defendants and Respondents. Super. Ct. No. CGC-08-473750)
In these consolidated appeals, Cal-Murphy, LLC, Najeeb Shihadeh, Mary
Christina Shihadeh, and George D. Omran appeal from judgments entered in this dispute
arising out of a commercial lease.
Appellants contend the trial court erred by (1) granting summary adjudication on
their trespass claim (which they based on an exhaust duct installed in their leased
premises), on the grounds that their lease contained a consent to the installation of the
duct and odors cannot constitute a trespass as a matter of law; (2) denying their motion
for reconsideration of the summary adjudication order; (3) granting judgment on the
pleadings, without leave to amend, on their separate claim for trespass based on an
accumulation of oil and grease within the duct; (4) granting judgment on the pleadings on
their nuisance claim for damages, on the ground that the recovery of damages was
1
precluded by an exculpatory clause in the lease; (5) granting summary adjudication on
their cause of action for breach of the implied covenant of good faith and fair dealing,
which they based on their claim that respondents leased space to a purported competitor
restaurant; (6) granting summary adjudication on their implied covenant claim based on
respondents’ delayed installation of signage; (7) granting summary adjudication on their
implied covenant claim based on their limited opportunity to deploy a “sandwich board”
to advertise their restaurant; (8) sustaining a demurrer without leave to amend and
dismissing the action as to a purported successor of one of the defendants; (9) denying
their motion to set aside this dismissal order based on their attorney’s excusable or
inexcusable neglect; (10) denying leave to file a sixth amended complaint; and
(11) dismissing the individual plaintiffs on the ground they lack standing as real parties in
interest. We will affirm the judgments.
I. FACTS AND PROCEDURAL HISTORY
Defendant-respondent NOP 560 Mission LLC (NOP) owned an office building at
560 Mission Street in San Francisco (Building). Defendant-respondent Hines Interests
Limited Partnership (Hines) managed the Building. For convenience, we will often adopt
appellants’ convention of referring to these respondents as NOP/Hines.
Plaintiff-appellant Cal-Murphy, LLC (Cal-Murphy) operated a restaurant called
Murphy’s Deli pursuant to a lease of street-level space in the Building. Plaintiffs-
appellants Najeeb Shihadeh, Mary Christina Shihadeh, and George Omran (Individual
Plaintiffs) were members of Cal-Murphy.
Cal-Murphy and the Individual Plaintiffs sued NOP/Hines and others for
numerous causes of action, contending they harmed Murphy’s Deli in various ways.
Through a series of motions, judgments were entered against Cal-Murphy and the
Individual Plaintiffs on all causes of action against respondents. While we will later
discuss in much greater detail the allegations, evidence, and procedural history relevant to
the issues on appeal, at this juncture we set forth only a brief overview for context.
2
A. The Lease
By January 2004, Hines and Murphy’s Deli Franchising, Inc. (MDF) had
negotiated a lease for a restaurant to operate in a portion of the street-level retail space in
the Building (Lease). The Lease, between National Office Partners Limited Partnership
(assignor to NOP) as “Landlord” and MDF as “Tenant,” consists of nearly 50 pages.
Among the Lease provisions relevant to this appeal are (1) section 2.02, which confirms
the landlord’s discretionary authority over common areas and reserves the right to install
conduit in the leased premises without unreasonable interference with the tenant’s use;
(2) section 4.04, which governs signage; (3) section 3.03(c), which specified that the
tenant had no exclusive right to operate a restaurant in the Building; (4) section 5.07(j),
which noted the landlord’s right to lease space in the Building to any party; (5) section
7.04, which exonerated the landlord from liability for damages arising from acts or
omissions; and (6) section 7.14, which provides that the Lease cannot be amended except
in writing.
In March 2004, MDF subleased the leased premises to the Individual Plaintiffs,
who assumed the rights and obligations of the Lease. By October 2004, the Individual
Plaintiffs formed Cal-Murphy and assigned the sublease to it. Murphy’s Deli opened for
business in April 2005.
B. The Problems
Appellants thereafter faced a host of problems, which they attribute to respondents
and others. We confine our summary to the matters at issue in this appeal.
1. Limited Display of Sandwich Board
In late 2004 or early 2005, Cal-Murphy’s on-site manager for Murphy’s Deli
(Steven Dudum) was advised by NOP/Hines’s building manager (Sandra Brownstone)
that Murphy’s Deli could display a “sandwich board” (a two-sided, A-shaped sign that
rests on the ground) outside the leased premises. Dudum had a sign made and showed it
to another building manager, who approved it for display from April 20 to May 26,
2005—but only for that period.
3
As discussed post, appellants contend NOP/Hines thereby breached the implied
covenant of good faith and fair dealing in the Lease. NOP/Hines contends there was no
breach because, essentially, the Lease gave it sole discretion to make the decision.
2. Delayed Installation of Blade Sign
Section 4.04 of the Lease granted Cal-Murphy a right to install, at its own expense
and with NOP/Hines’s approval, a sign on the exterior surface of the Building. In early
2006, Building property manager Brownstone told the operations manager for Murphy’s
Deli (Bajis Katwan) that NOP/Hines intended to install a “blade sign” (extending
horizontally from the exterior wall of the Building) for Murphy’s Deli at NOP/Hines’s
expense. In February 2007, NOP/Hines advised that this sign would be installed within
four to six weeks. It was not installed, however, until April 14, 2008.
Appellants contend NOP/Hines breached the implied covenant of good faith and
fair dealing in the Lease by delaying the installation of the sign; for various reasons,
NOP/Hines disagrees.
3. Lease to Competitor Mixt Greens
In October 2007, NOP/Hines leased the space adjacent to Murphy’s Deli to a
restaurant called Mixt Greens, which appellants contend is a competitor of Murphy’s
Deli. Mixt Greens opened for business in April 2008.
Appellants claim that, by leasing to Mixt Greens, NOP/Hines breached the implied
covenant of good faith and fair dealing; NOP/Hines counters that the Lease did not
require it to lease to a complementary rather than competitive restaurant.
4. Mixt Greens’s Duct, Odors and Grease
In January 2008, NOP/Hines’s assistant building manager informed Katwan that
NOP/Hines intended to run ducts through Murphy’s Deli to service Mixt Greens’s
cooking equipment. By February 8, 2008, Mixt Greens’s cooking equipment, including a
gas grill and a “Type II” cooking hood, was connected to ducts running from Mixt
Greens’s kitchen, across the ceiling of the adjacent space of Murphy’s Deli, and out to an
alley behind the Building.
4
After Mixt Greens opened in mid-April 2008, bad odors entered Murphy’s Deli,
and customers complained. Beginning in December 2009 (after appellants commenced
litigation against NOP/Hines, see post), a buildup of grease was found inside the ducts
that passed through Murphy’s Deli. Mixt Greens stopped cooking in approximately
January 2012. In March 2012, the ducts were removed.
Appellants argue that the ducts, and particularly the odors emitted from the ducts
into Murphy’s Deli and the grease and oils accumulated within the ducts, constituted a
nuisance and a trespass by NOP/Hines into the leased premises. NOP/Hines counters
that, in light of certain provisions of the Lease, it has no liability as a matter of law.
C. The Litigation
Based on these and other events, appellants pursued this lawsuit.
1. Appellants’ Complaint and Amended Complaints
In March 2008, Cal-Murphy and the Individual Plaintiffs filed a complaint against
NOP/Hines, asserting causes of action for fraud, negligent misrepresentation, breach of
the implied covenant of good faith and fair dealing, breach of the Lease, and trespass.
In April 2008, after Mixt Greens opened for business next to Murphy’s Deli, Cal-
Murphy and the Individual Plaintiffs filed a first amended complaint, adding Mixt Greens
as a defendant and causes of action for nuisance.
Cal-Murphy and the Individual Plaintiffs thereafter filed a second amended
complaint, third amended complaint, fourth amended complaint, and first and second
amendments to the fourth amended complaint.
The fifth amended complaint—the operative pleading at the time of the orders at
issue in this appeal—contained causes of action against NOP/Hines for, as relevant
here: breach of the implied covenant of good faith and fair dealing; trespass; nuisance;
and trespass based on the alleged accumulation of grease in the duct. As discussed
post, Mixt Greens’s purported successor, respondent MG Restaurants (MGR), was
eventually added as a defendant.
5
As mentioned, all of appellants’ claims against respondents were ultimately
dismissed. For clarity, we briefly set forth here the disposition of these claims according
to the parties involved, leaving a more precise chronology for later discussion.
2. Judgment of Dismissal as to Claims Against NOP/Hines
In April 2011, the court granted NOP/Hines’s motion for summary adjudication as
to Cal-Murphy’s third cause of action for breach of the implied covenant of good faith
and fair dealing, which had been based on the lease of space to Mixt Greens, delay in
installing a blade sign, and refusal to permit a sandwich board (as well as a purported
refusal to permit Murphy’s Deli to install a grill while allowing Mixt Greens to use one).
By written order filed on March 5, 2012, the court next granted NOP/Hines’s
motion for summary adjudication as to the fifth cause of action for trespass based on the
ducts. Cal-Murphy filed a motion for reconsideration, asserting newly discovered
evidence of holes and openings in the ducts that permitted odors to enter Murphy’s Deli.
In April 2012, by written order entered on May 11, 2012, the court denied Cal-Murphy’s
motion for reconsideration.
In April 2012, the court granted NOP/Hines’s motion for judgment on the
pleadings as to the ninth cause of action for trespass based on the accumulation of grease
within the ducts, but allowed Cal-Murphy to submit a proposed amendment to its
pleading.
On May 18, 2012, by written order filed on June 18, 2012, the court denied Cal-
Murphy leave to file its proposed sixth amended complaint, thereby also denying its
request for leave to amend its pleading as to the ninth cause of action.
Also by written order filed on June 18, 2012, the court granted NOP/Hines’s
motion for a case management order excluding all evidence of damages against it in
regard to the claims remaining in the case, on the ground that a damages award was
precluded by the exculpatory clause in the Lease. On that same date, the court granted
NOP/Hines’s motion for judgment on the pleadings with respect to the remaining sixth
cause of action for nuisance, in light of the case management order excluding evidence of
damages.
6
On June 18, 2012, judgment was entered in favor of NOP/Hines.
3. Judgment of Dismissal as to Claims Against MGR
Meanwhile, in February 2012, Cal-Murphy substituted MGR as Doe One in the
fifth amended complaint. MGR was an entity created by David Silverglide, a former
principal of Mixt Greens. MGR had acquired the principal assets of Mixt Greens in
California, including the equipment at 560 Mission Street.
In March 2012, MGR filed a demurrer to the fifth amended complaint. Cal-
Murphy did not file an opposition to the demurrer. Instead, at the hearing on the
demurrer, Cal-Murphy’s attorney advised the court that he had filed a declaration with a
proposed sixth amended complaint and believed he could file an amended complaint
against MGR as of right.
On May 7, 2012, the court sustained MGR’s demurrer without leave to amend.
On May 24, 2012, a judgment of dismissal was entered in favor of MGR.
On June 18, 2012, and by written order filed on September 4, 2012, the court
denied Cal-Murphy’s motion for relief from the dismissal under Code of Civil Procedure
section 473.
4. Judgment Dismissing Individual Plaintiffs
In June 2011, and by written order dated July 29, 2011, the court sustained without
leave to amend a demurrer by NOP/Hines to the fifth amended complaint as to the
Individual Plaintiffs, on the ground they lacked standing.
A judgment of dismissal was entered against the Individual Plaintiffs in August
2012.
5. Appellants’ Appeals
In July 2012, Cal-Murphy filed a notice of appeal from the judgment entered in
favor of NOP/Hines, the judgment dismissing MGR, and the order denying relief from
that dismissal. This became appeal number A136198.
In October 2012, Cal-Murphy and the Individual Plaintiffs appealed from the
judgment of dismissal of the Individual Plaintiffs, as well as an amended judgment of
dismissal of MGR (amended in September 2012 to include the amount of costs awarded),
7
the order denying relief from the dismissal (to the extent the previous notice of appeal
was inadequate), and a September 2012 order on Cal-Murphy’s motion to strike costs.
This became appeal number A136854.
Appeals A136198 and A136854 were consolidated.1
II. DISCUSSION
We address appellants’ contentions in turn.
A. Summary Adjudication of Fifth Cause of Action (Trespass by Duct)
The fifth cause of action of Cal-Murphy’s fifth amended complaint asserted a
trespass based on the ducts that were installed through the leased premises of Murphy’s
Deli. The cause of action incorporated by reference paragraph 15 of the pleading,
alleging that “two permanent, galvanized metal ducts” were constructed by defendants
through Murphy’s Deli’s leased premises to enable Mixt Greens to operate a grill,
without Cal-Murphy’s consent, and there was “no provision in the Lease that would
permit such action.” It also incorporated paragraphs 16 and 27, alleging that odors had
been emitted into Murphy’s Deli and oils had accumulated inside the ducts as a result of
NOP/Hines’s failure to require Mixt Greens to install the “proper” equipment.
1
Claims by Cal-Murphy against Mixt Greens, and a cross-action by NOP against
MDF and others, are pending in the San Francisco Superior Court. Also pending are
other appeals. In January 2013, Cal-Murphy and the Individual Plaintiffs appealed from
postjudgment orders relating to attorneys’ fees and costs imposed against the Individual
Plaintiffs (appeal number A137609). In February 2013, the trial court entered amended
judgments for NOP/Hines and against Cal-Murphy in the amount of $2,472,615 for
attorneys’ fees and costs, and an amended judgment for NOP/Hines and against the
Individual Plaintiffs in the amount of $1,468,743 for attorneys’ fees and costs, and Cal-
Murphy and the Individual Plaintiffs appealed (appeal number A137959). These
judgments have been superseded by “Corrected and Second Amended” judgments, which
reflect orders awarding supplemental attorney fees to NOP and eliminate an attorney fee
award in favor of Hines; these judgments are the subject of appeal number A139772. In
the interest of justice and judicial economy, we construe the notices of appeal broadly so
we may decide the issues briefed in appeals A136198 and A136854 notwithstanding the
amendments to the judgments, and we leave the issues raised by those amendments to
appeals A137959 and A139772.
8
NOP/Hines moved for summary adjudication, and the parties debated at length—
as they do here—the scope of the fifth cause of action. The claim plainly encompasses
the installation of the ducts within the premises of Murphy’s Deli. Cal-Murphy contends
it also asserts a trespass based on odors that entered Murphy’s Deli via the ducts, and the
allegedly improper construction or design of the ducts (which led to the odors in
Murphy’s Deli and the accumulation of grease).
In this section of our opinion, we consider the installation of the ducts, as well as
Cal-Murphy’s evidence concerning the construction and the intrusion of odors into its
premises. We address Cal-Murphy’s contention of a trespass based on the accumulation
of grease post in the context of Cal-Murphy’s ninth cause of action, which asserted a
trespass based specifically on the grease.
1. Law
We conduct an independent review to determine whether there is a triable issue of
material fact and the moving party is entitled to summary adjudication as a matter of law.
(Code Civ. Proc., § 437c, subd. (c); Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th
826, 860.) We construe the moving party’s evidence strictly, and the non-moving party’s
evidence liberally, in determining whether there is a triable issue. (See D’Amico v. Board
of Medical Examiners (1974) 11 Cal.3d 1, 20; Alex R. Thomas & Co. v. Mutual Service
Casualty Ins. Co. (2002) 98 Cal.App.4th 66, 72 (Thomas).)
A defendant seeking summary adjudication must show that at least one element of
the plaintiff’s cause of action cannot be established, or that there is a complete defense to
the cause of action. (Code Civ. Proc., § 437c, subd. (p)(2).) The burden then shifts to the
plaintiff to show there is a triable issue of material fact on that issue. (See Code Civ.
Proc., § 437c, subd. (p)(2); Thomas, supra, 98 Cal.App.4th at p. 72.)
2. NOP/Hines Met Its Initial Burden
“The essence of the cause of action for trespass is an ‘unauthorized entry’ onto
the land of another.” (Spinks v. Equity Residential Briarwood Apartments (2009) 171
Cal.App.4th 1004, 1042-1043 (Spinks).) If the entry has been by consent, the element of
unauthorized entry is not established, and there has been no trespass. (Civic Western
9
Corp. v. Zila Industries, Inc. (1977) 66 Cal.App.3d 1, 16-17.) Consent may be provided
by prior agreement. (Williams v. General Elec. Credit Corp. (1958) 159 Cal.App.2d
527, 532.)
NOP/Hines sought summary adjudication on the ground that the alleged entry
into Cal-Murphy’s leasehold—the installation of the duct—was the subject of a prior
consent set forth in section 2.02 of the Lease.
Section 2.02, entitled “Landlord’s Reserved Rights,” provides in part: “Landlord
reserves from the leasehold estate hereunder, in addition to all other rights reserved by
Landlord under this Lease: (i) all exterior walls and windows bounding the Leased
Premises, and all space located within the Leased Premises for Major Vertical
Penetrations, conduits, electric and other utilities, air-conditioning, sinks or other
Building facilities that do not constitute Tenant Extra Improvements, the use thereof and
access thereto through the Leased Premises for operation, maintenance, repair or
replacement thereof, and (ii) the right from time to time, without unreasonable
interference with Tenant’s use, to install, remove or relocate any of the foregoing for
service to any part of the Building to locations that will not materially interfere with
Tenant’s use of the Leased Premises . . . .” (Italics added.)
In essence, section 2.02 permits NOP/Hines to install a “conduit[ ]” in any part of
the Building, as long as the installation does not unreasonably interfere with the
Tenant’s use, at a location that will not materially interfere with the Tenant’s use.
NOP/Hines contended that the duct is a “conduit” or air conditioning within the
meaning of section 2.02, and presented evidence that the installation of this conduit did
not interfere with Cal-Murphy’s use of the premises: NOP/Hines arranged for the
installation of the duct on a schedule “acceptable to Murphy’s Deli”; the duct was
installed along the ceiling of the leased premises, 25 feet from the floor, and was not in
the way of Murphy’s Deli’s activities or the operation of the restaurant; and Amad
Qureshi, a manager of Murphy’s Deli, testified to the effect that the duct (itself) did not
preclude Murphy’s Deli from making sandwiches or its employees from doing their
10
jobs.2 From this evidence, a reasonable trier of fact could conclude that the installation
of the duct, at the location at which it was installed, did not unreasonably or materially
interfere with Cal-Murphy’s use of the leased premises. As such, section 2.02 provided
consent to the duct, and its installation would not constitute a trespass.
The burden shifted to Cal-Murphy to establish a triable issue of material fact.
3. Cal-Murphy Failed to Show a Triable Issue of Material Fact
Cal-Murphy did not submit evidence to establish a triable issue with respect to an
unreasonable interference with its premises based on the duct’s installation. Instead, it
presented evidence that (1) its leasehold was unreasonably interfered with by the odors
from Mixt Greens, which entered its premises via the duct; (2) NOP/Hines’s conduct
exceeded the consent set forth in section 2.02; and (3) Cal-Murphy withdrew its consent.
a. Unreasonable Interference Based on Odors
Cal-Murphy argues there is a triable issue as to whether the installation of the duct
unreasonably interfered with Cal-Murphy’s tenancy because of the resulting odors,
particularly due to the odors’ impact on customers and potential customers. It points to
testimony by Qureshi that “[t]here is smells somewhere from there [the duct] or from
next door or from outside, I don’t know,” which began after Mixt Greens started
business. A declaration from Bajis Katwan, the operations manager, references odors but
does not describe any interference by the duct itself. On-site manager Osama Sweiti’s
declaration asserted daily receipt of complaints from customers about the odors (not the
duct itself). The declaration of Dana Zumot, another on-site manager, averred that the
odors stopped when the “ducts inside Mixt Greens” were removed. Cal-Murphy also
points to evidence that sales increased by over 30 percent for the first four months after
2
When asked about whether the duct interfered with the operations of Murphy’s
Deli, Qureshi replied: “I don’t understand why you’re asking this question. I mean this
light, this light, are stopping us while talking with me or you? No, right? It’s there. The
duct is there.”
11
the odors stopped.3 The inference from this evidence is that Murphy’s Deli was affected
by the odors, not the duct itself, particularly since Murphy’s Deli saw an uptick in sales
after Mixt Greens stopped cooking in January 2012, while the duct remained in place
until March 2012.
However, evidence that the odors interfered with the operations of Murphy’s Deli
did not create a disputed issue of fact material to the trespass cause of action.
In the first place, as a matter of law, odors do not create a trespass. (See Wilson v.
Interlake Steel Co. (1982) 32 Cal.3d 229, 232-233 (Wilson) [like other intangible
intrusions such as odor or light, noise from an adjacent property does not constitute
trespass unless it causes physical damage]; San Diego Gas & Electric Co. v. Superior
Court (1996) 13 Cal.4th 893, 935-937 (San Diego Gas) [intentional emission of
electromagnetic radiation onto plaintiffs’ property does not constitute trespass].)
Cal-Murphy’s attempt to distinguish Wilson and San Diego Gas is unavailing. It
is true that the plaintiffs in those cases claimed a trespass based on intangible intrusions
into their premises from another property, as opposed to Cal-Murphy’s claim of a
trespass based on odors emitted from the duct passing through and outside its premises.
However, this distinction is immaterial. The point is that intangible phenomena that do
not cause physical damage to the plaintiff’s property cannot be the basis of a trespass.
(San Diego Gas, supra, 13 Cal.4th at pp. 936-937 [allegation that electromagnetic fields
made the property unsafe and uninhabitable was insufficient, because it asserted only a
risk of personal harm, not harm to property].) In the matter before us, there was no
evidence that the odors from Mixt Greens’s kitchen, however they made their way into
Murphy’s Deli, caused physical damage to Cal-Murphy’s property.
3
NOP/Hines argues that the assertion of a 30 percent increase in sales is not
supported by admissible evidence, and Cal-Murphy’s record citations are to evidence the
trial court ruled inadmissible, Cal-Murphy’s briefs, or the proposed (but unfiled) sixth
amended complaint. Zumot’s declaration avers that sales increased.
12
Thus, while the installation of the duct was a physical intrusion, it was not a
trespass because of the consent under section 2.02; and the intrusion by the odors was not
a trespass because it did not constitute a physical intrusion or cause physical damage.
That the odors did not in themselves constitute a trespass does not totally resolve
the matter, however. Cal-Murphy’s argument is not so much that the odors constituted a
trespass, but that the odors meant the duct eventually interfered unreasonably with Cal-
Murphy’s use of the premises, and therefore the duct’s installation would not fall within
the consent set forth in section 2.02. NOP/Hines does little to rebut this point, but again
we must disagree.
The consent provided by section 2.02 is subject to the condition that the
installation of the duct not interfere with the leased premises. The language that
NOP/Hines has the “right from time to time, without unreasonable interference with
Tenant’s use, to install, remove or relocate [conduit]” squarely points to an interference
arising from the act of the installation itself, at the time of the installation (italics added).
Here, the evidence is that Mixt Greens’s odors arose months after the installation, and no
evidence was presented that the initial installation itself unreasonably interfered with Cal-
Murphy’s use of the leased premises.4 Accordingly, whether or not the evidence of the
odors could give rise to some other cause of action, Cal-Murphy has not demonstrated a
triable issue of fact material to whether the consent in section 2.02 precluded Cal-
Murphy’s trespass claim.
b. Conduct Exceeding Consent
Cal-Murphy next contends there was a triable issue of material fact as to whether
NOP/Hines’s conduct exceeded the consent reflected in section 2.02. (Citing Rest.2d
Torts, § 892A, subds. (2)(b) & (4); see Dwyer v. Carroll (1890) 86 Cal. 298, 302-303
[landlord trespassed where it constructed a new story on the building and dug a cellar,
4
Cal-Murphy presents no substantial argument as to the other condition of the
consent set forth in section 2.02: that the conduit be installed at a location “that will not
materially interfere with Tenant’s use of the Leased Premises.” In any event, this
condition also refers to the duct’s installation.
13
depriving tenant of the use of its leased premises, because tenant agreed landlord could
enter only to make repairs to a first-story floor]; Williams v. General Elec. Credit Corp.
(1958) 159 Cal.App.2d 527, 533 [although seller had an implied right to enter into
buyer’s premises to repossess items upon the buyer’s default, its entry into other parts of
the buyer’s residence could constitute a trespass].) Specifically, Cal-Murphy refers us to
evidence that, it claims, shows the lack of a proper building permit for the duct, the
wrong type of duct, violations of the California Mechanical Code, and the emission of
odors and creation of a fire hazard.
Cal-Murphy’s argument is unavailing. A trespass requires physical entry.
NOP/Hines’s physical entry into the leased premises was only to install the duct (covered
by section 2.02), and none of the evidence Cal-Murphy cites shows a physical entry into
its premises beyond the installation. Nor is there evidence NOP/Hines physically
intruded any distance or manner unnecessary for the duct’s installation, or that it
constructed more than the duct. And even if Mixt Greens’s later emission of odors into
the leased premises could be attributed to NOP/Hines, it did not constitute a physical
intrusion. Accordingly, Cal-Murphy failed to demonstrate a material triable issue as to
whether NOP/Hines exceeded the consent set forth in section 2.02.
c. Withdrawal of Consent
In a footnote in its opening brief in this appeal, Cal-Murphy contends there was a
triable issue as to whether Murphy’s Deli had effectively withdrawn the consent provided
by section 2.02, since Cal-Murphy filed its lawsuit and its manager (Katwan) twice raised
an objection with the Building’s assistant manager, first claiming the installation of the
ducts was a trespass and, after viewing the duct outside, asserting that odors would likely
enter Murphy’s Deli.
Cal-Murphy’s argument has no merit. A party cannot unilaterally withdraw from
the terms of its contract by merely objecting to the other party’s exercise of its
contractual right or claiming in a pleading that the right does not exist.
14
In sum, Cal-Murphy did not establish a triable issue of material fact, and the court
did not err in granting summary adjudication on the fifth cause of action for trespass.5
4. Motion for Reconsideration
Ten days after notice of the entry of the order granting summary adjudication on
the fifth cause of action, Cal-Murphy filed a motion for reconsideration based on newly
discovered evidence. (Code Civ. Proc., § 1008.) According to the motion, the duct that
ran through Murphy’s Deli was removed after the summary adjudication hearing, and
Cal-Murphy’s expert observed holes and openings in the duct. Cal-Murphy offered
evidence that odors could have or would have entered Murphy’s Deli through these holes
and openings, which purportedly had been caused by improper welding of the duct
sections.
The court denied Cal-Murphy’s motion but took its prior ruling under
reconsideration for another reason. As explained in the court’s written order: “The
motions for reconsideration are denied. The Court on its own motion reconsidered the
question of whether an allegedly defectively-constructed duct can constitute a trespass
because of its impact on Plaintiff’s business due to alleged release of odors into the
business from the duct. Intrusion into Plaintiff’s business by odors does not constitute a
trespass as a matter of law. The claim that defects in the construction of the duct caused
the odors to enter the business does not change that.”
Cal-Murphy contends the court erred. We disagree. For the reasons stated ante,
the installation of the duct did not constitute a trespass because it was authorized by
section 2.02; the emission of the odors did not constitute a trespass because odors are
intangible and there was no evidence they caused physical damage; and, even considering
Cal-Murphy’s newly discovered evidence, the fact that the duct was one of the means by
5
In another footnote in its opening brief, Cal-Murphy argues that section 2.02
should not be interpreted to confer consent for the installation of the duct, because the
provision did not purport to cover a leasehold improvement installed for the benefit of
another tenant (a competing business) and the ducts were “Tenant Extra Improvements”
excluded under section 2.02. Because Cal-Murphy does not explain or support this
argument in its opening brief, it is both waived and unpersuasive.
15
which Mixt Greens’s odors may have entered Murphy’s Deli does not render the duct an
intrusion outside the scope of the consent of section 2.02.
Cal-Murphy fails to establish error as to the fifth cause of action for trespass.
B. Judgment on the Pleadings on Ninth Cause of Action (Trespass by Grease)
The title of Cal-Murphy’s ninth “and separate” cause of action targeted a “trespass
caused by the deposit of animal and vegetable oils into plaintiffs’ leased premises.” The
pleading incorporated allegations from paragraph 27, that the ducts were not properly
constructed, did not contain access doors or cleanouts at proper intervals, were not
properly sloped, and that due to the type of hood NOP/Hines installed and the absence of
a “precipitator,” “a film of animal and vegetable oils and grease has accumulated within
the ducts that originate in Mixt Greens’s space and travel through Murphy’s Deli’s
space.” It was further alleged that this accumulation of grease created a fire hazard.
The trial court granted NOP/Hines’s motion for judgment on the pleadings as to
this cause of action, and it ultimately denied Cal-Murphy leave to amend by declining its
request to file a sixth amended complaint. Cal-Murphy contends the court erred in both
respects.
1. Judgment on the Pleadings
In our review of an order granting judgment on the pleadings, we assume the truth
of the well-pleaded allegations and review de novo whether those allegations state a
cause of action. (Bettencourt v. Hennessy Industries, Inc. (2012) 205 Cal.App.4th 1103,
1111 (Bettencourt).)
To state a cause of action for trespass, a plaintiff must allege an unauthorized and
tangible entry onto the land of another, which interfered with the plaintiff’s exclusive
possessory rights. (Capogeannis v. Superior Court (1993) 12 Cal.App.4th 668, 674;
Wilson, supra, 32 Cal.3d at p. 233; Spinks, supra, 171 Cal.App.4th at pp. 1042-1043.)
Cal-Murphy failed to state a trespass cause of action, because it did not allege
facts showing that the accumulated grease interfered with its exclusive possessory rights.
The grease was alleged to have “accumulated within the ducts.” (Italics added.) Cal-
Murphy had no exclusive possessory right to that area. Rather, the duct was installed for
16
Mixt Greens to vent its kitchen, and upon the duct’s installation (long before any grease
began to accumulate) it was expressly excluded from Cal-Murphy’s leasehold pursuant to
section 2.02 of the Lease. The court did not err in granting NOP/Hines’s motion for
judgment on the pleadings.
2. Denial of Leave to Amend
In its written opposition to NOP/Hines’s motion for judgment on the pleadings and
at the hearing on the motion, Cal-Murphy sought leave to amend the ninth cause of action
if the motion was granted. Cal-Murphy did not, however, explain at the time how the
pleading could be further amended to state a viable trespass claim. Nonetheless, the court
gave Cal-Murphy the opportunity to present a proposed amendment, and the issue of
whether leave to amend would be granted was not resolved until Cal-Murphy had
submitted two proposed sixth amended complaints, which purported to amend its
pleading not only in regard to the ninth cause of action for trespass, but in other respects
as well. For clarity, we address here the court’s denial of leave to file the proposed sixth
amended complaint to the extent it sought to amend the ninth cause of action for trespass;
we address the court’s denial of leave to file the sixth amended complaint in other
respects post.
We review the denial of leave to amend for an abuse of discretion. (Bettencourt,
supra, 205 Cal.App.4th at p. 1111.) “The trial court abuses its discretion if it denies
leave to amend when there is a reasonable possibility the defect in the pleading could be
cured by amendment.” (Ibid.)
Cal-Murphy contends it should have been allowed to allege new facts to
“amplif[y] and augment[ ] the allegations relating to the trespass cause of action,” facts it
discovered after filing the fifth amended complaint, and “the return of David Silverglide,
the principal of both Mixt Greens and MGR, and the arrival on the scene of MGR.” It
also urges that it should have been allowed to allege multiple violations of the
Mechanical Code in the installation and maintenance of the ducts, and that NOP/Hines
“knew with substantial certainty” that its conduct was wrongful or would injure Cal-
Murphy.
17
Cal-Murphy fails to demonstrate how these allegations would cure the
deficiencies in its pleading as to the trespass claim—particularly the defect that the
allegations did not show interference with its exclusive possessory rights. Cal-
Murphy’s revised proposed sixth amended complaint did not allege a physical
interference with Cal-Murphy’s right to its leased premises (other than the allegation
of the intrusion by the duct itself, which we discuss ante).6 The court did not abuse its
discretion in denying leave to amend.
Cal-Murphy contends it was misled by the trial court’s earlier order overruling
NOP/Hines’s demurrer to the trespass claim. (See Higgins v. Del Faro (1981) 123
Cal.App.3d 558, 565.) Under the circumstances of this case, the court’s prior order did
not undermine the propriety of the court’s grant of judgment on the pleadings and denial
of leave to amend.7
C. Denial of Leave to File Sixth Amended Complaint
We next turn to the court’s order denying Cal-Murphy leave to file its revised
proposed sixth amended complaint with respect to allegations other than the ninth cause
of action for trespass, such as its proposed claims for injunctive relief based on nuisance,
breach of the covenant of quiet enjoyment, violations of the Mechanical Code and, as to
MGR, liability as Mixt Greens’s successor. We begin with some additional background.
1. Background
By the time Cal-Murphy first submitted a proposed sixth amended complaint in
April 2012, four years had elapsed since the original complaint and a March 2012 trial
6
Cal-Murphy’s proposed pleading did allege that holes and openings in the exhaust
duct permitted grease (as well as odors) to enter Murphy’s Deli. But there is no
allegation of physical damage caused by the grease (as required for trespass) or monetary
damages incurred as a result of the grease specifically (as required for a damages claim).
The grease buildup inside the duct was alleged to be a fire hazard.
7
Cal-Murphy repeatedly asserts that the trial court should have considered the
grease aspect of its trespass claims in the context of NOP/Hines’s summary
adjudication motion. However, Cal-Murphy fails to show prejudice from disposing of
the cause of action by judgment on the pleadings instead of by summary adjudication,
particularly since Cal-Murphy is not entitled to relief as a matter of law, whether
based on Cal-Murphy’s allegations or based on its evidence.
18
date had already passed. At a hearing in May 2012, the court advised that Cal-Murphy’s
proposed pleading did not appear sufficient; however, it gave Cal-Murphy another
chance.
On May 18, 2012, Cal-Murphy submitted a “Revised Proposed Sixth Amended
Complaint.” After a hearing, the trial court denied Cal-Murphy leave to file its revised
proposed sixth amended complaint, on the ground that the new pleading would cause
undue delay, inefficiencies, and prejudice.
The trial court stated: “The proposed sixth amended complaint is replete with
problems, and while the standard for allowing for the filing of amended pleadings is
somewhat liberal, that liberality wanes as the case proceeds, and the Court is supposed to
take a closer and closer look at what is sought to be injected into the case as the length of
the case increases and as you are close to trial. [¶] I believe that there are so many things
wrong with the revised sixth amended complaint that it would result in undue delay in the
efficient administration of the remaining portion of this case, and would cause prejudice
to NOP Hines at least, perhaps to Mixt Greens. [¶] . . . [¶] [B]oth those parties have a
right to have this case packaged up and resolved, be it through trial or something else.
And it is clear that the sixth amended complaint, the revised sixth amended complaint,
prejudices those parties’ right to do so. It will result in inordinate delay and expense in
resolving the issues here.”
The court proceeded to support this conclusion: “By way of example, the sixth
amended complaint seeks to inject claims which this Court has already eliminated from
this case. The trespass claims were eliminated by my order of March 5, 2012, in the
summary adjudication of the fifth cause of action and the motion for judgment on the
pleadings, which was granted by an April 11, 2012 order, and the claim in the sixth
amended complaint regarding a supposed duty on the part of the plaintiff [sic], which I
resolved on the—in a December 12, 2011 order. . . . [¶] There’s a claim for successor
liability on the part of MG Restaurants, which I have already ruled has no place here.
[¶] There’s a big problem with the claimed injunction action, in light of what I believe
has been represented by all parties to me, that the action which is the subject of the
19
injunction has ceased. What that will precipitate will be substantial discovery and that’s
part of what I think they want to—plaintiff wants to take Mr. Silverglide’s deposition
about, is why was the action terminated and will it resume again. That will take a long
time to sort out. The “why” is probably irrelevant, but the “will it resume again” could
conceivably find its place somewhere, at least in motion practice. Again, undue delay.
[¶] And the bottom line is that this revised sixth amended complaint appears to render
this case what it is that has been advocated by the defendants for some time to me, is the
never-ending story. But we don’t have a never-ending story. [¶] . . . [¶] In addition, it is
not up to me to parse out the portions of the revised sixth amended complaint that may be
viewed differently than other portions. The motion before me is a motion to file the
proposed revised sixth amended complaint. And that is denied. Do not read what I just
said as an invitation to cut out little pieces of it and try it again. [¶] There is no question
in my mind that what we have reached in this case is the stage where undue prejudice
will befall the defendant if we continue to have a moving target for what this case is
about. The defendant is entitled to a resolution of the claims here, and that’s what is
going to happen next.” (Italics added.)
2. The Court Did Not Abuse Its Discretion
Denial of leave to amend is proper where the proposed amendment is untimely or
would cause prejudice in delaying the trial, increasing discovery or other litigation
activity. (Yee v. Mobilehome Park Rental Review Bd. (1998) 62 Cal.App.4th 1409, 1428;
P&D Consultants, Inc. v. City of Carlsbad (2010) 190 Cal.App.4th 1332, 1345.)
The record contains ample support for the conclusion that the proposed sixth
amended complaint would have further and unduly delayed the trial in a case that had
been pending for over four years. The claims against MGR would have caused more
litigation activity, as would the attempted resurrection of claims on which the court had
already ruled. Furthermore, the revised proposed sixth amended complaint would have
resulted in another round of demurrers, since it arguably failed to allege facts that would
20
have cured the defects in the trespass claims and failed to state a claim for injunction or
breach of the covenant of quiet enjoyment.8
Cal-Murphy contends the trial court was wrong to deny leave to file the sixth
amended complaint based on its timing, particularly as to the cause of action for trespass
and its new claim for breach of the covenant of quiet enjoyment, because (1) it had
previously mentioned its intention to bring additional claims; (2) no additional discovery
would be required with respect to the quiet enjoyment claim; and (3) in the absence of
prejudice, amended pleadings should be permitted notwithstanding delay. (Citing
Kittredge Sports Co. v. Superior Court (1989) 213 Cal.App.3d 1045, 1048.) Cal-Murphy
also argues that its successor liability theory was different than what it had previously
proposed to the court and, if that claim posed prejudice or delay, the claim could be
severed.
The question, however, is not whether there was an argument in favor of allowing
the revised proposed sixth amended complaint, but whether the denial of leave was so
irrational and arbitrary as to constitute a prejudicial abuse of discretion. For our reasons
stated ante, it was not.
8
As to curing the defects in the trespass claims, NOP/Hines asserts that the
proposed pleading did not allege facts sufficient to avoid enforcement of the exculpatory
clause, or any unauthorized entry that the court had not already rejected as a trespass. As
to the new causes of action, NOP/Hines asserts that Cal-Murphy’s claim for injunctive
relief based on a nuisance had no merit, because Mixt Greens had already stopped
cooking in its space and the subject equipment had been removed. NOP/Hines also
contends Cal-Murphy’s claim for breach of the covenant of quiet enjoyment was
defective because there was no allegation of conduct that rendered the premises unfit for
its contemplated purposes or substantially affected Cal-Murphy’s enjoyment of a material
part of the premises (Civ. Code, § 1927). Further, the parties debate the effectiveness of
the new allegations concerning the violations of the Mechanical Code. NOP/Hines urges
that the code sections cited in the revised proposed sixth amended complaint apply to a
“Type I hood” rather than the “Type II hood” installed in Mixt Greens’s space, while Cal-
Murphy counters that it alleged that a Type I hood should have been installed. In
addition, MGR disputes the sufficiency of the allegations as to its liability as successor of
Mixt Greens.
21
Cal-Murphy has failed to demonstrate error in the denial of leave to file its revised
proposed sixth amended complaint.
D. Judgment on the Pleadings on Sixth Cause of Action (Nuisance)
Cal-Murphy’s sixth cause of action asserted a nuisance claim. Cal-Murphy
alleged, on information and belief, that NOP/Hines and other defendants knew or should
have known that, as designed, the grill and cooking equipment used by Mixt Greens, as
vented through the ducts, would emit offensive odors into Murphy’s Deli and result in the
accumulation of animal and vegetable oils in the ducts, and that there was technology
available to alleviate the odors and accumulation of oils. Cal-Murphy sought damages,
alleging interference with Cal-Murphy’s use and enjoyment of the Murphy’s Deli space.
NOP/Hines filed a motion for a case management order that would preclude Cal-
Murphy from offering evidence of damages as to the claims remaining in the case
(including this nuisance claim), on the ground that NOP/Hines’s liability for those
damages was precluded as a matter of law by an exoneration clause in section 7.04 of the
Lease. The court granted NOP/Hines’s motion by an amended case management order
on June 18, 2012. On that same date, the court granted NOP/Hines’s motion for
judgment on the pleadings with respect to the nuisance cause of action.
Cal-Murphy contends the court’s rulings were erroneous, because there were
triable factual issues which, if resolved in Cal-Murphy’s favor, would preclude
enforcement of the exoneration clause. We first consider the scope of the clause, and
then its enforceability.
1. Scope of the Lease Exoneration Clause (Section 7.04)
Section 7.04 of the Lease, entitled “Indemnity and Exoneration,” provides in
subsection (a): “Landlord shall not be liable for any loss, injury or damage to person or
property of Tenant . . . which may arise through repair, alteration or maintenance of any
part of the Project or failure to make any such repair or from any other cause whatsoever
except as expressly otherwise provided in Section 7.06 [referring to condemnation].
Landlord shall not be liable for any loss, injury or damage arising from any act or
omission of any other tenant or occupant of the Project, nor shall Landlord be liable
22
under any circumstances (including Landlord’s negligence) for damage or inconvenience
to Tenant’s business or for any loss of income or profit therefrom.” (The “Project” was
defined in the Lease as the Building, the real property on which it is located, and
improvements or facilities.)
By its terms, then, section 7.04(a) precludes liability to Cal-Murphy for damages
arising from “repair, alteration or maintenance,” from “any other cause whatsoever”
(except condemnation), from “any act or omission of any other tenant” such as Mixt
Greens, or “under any circumstances (including Landlord’s negligence) for damage or
inconvenience to Tenant’s business or for any loss of income profit therefrom.” (Italics
added.) Its scope plainly included the damages Cal-Murphy sought from NOP/Hines in
the nuisance claim alleged in the fifth amended complaint.
2. Enforceability of Section 7.04(a) (Civil Code Section 1668)
Cal-Murphy contends that section 7.04(a) is unenforceable under Civil Code
section 1668 (section 1668), which provides: “All contracts which have for their object,
directly or indirectly, to exempt anyone from responsibility for his own fraud, or willful
injury to the person or property of another, or violation of law, whether willful or
negligent, are against the policy of the law.” (Italics added.)
Under section 1668, an exculpatory provision like section 7.04 may be enforced to
preclude liability for negligence, where, as here, the contract does not involve the public
interest. (Tunkl v. Regents of University of California (1963) 60 Cal.2d 92, 96; McCarn
v. Pacific Bell Directory (1992) 3 Cal.App.4th 173, 178-179, 182; Cregg v. Ministor
Ventures (1983) 148 Cal.App.3d 1107, 1111.) An exoneration clause is not enforceable,
however, to preclude liability for an intentional wrong, gross negligence, or a violation of
a statute or regulatory law, whether or not the contract itself affects the public interest.
(Health Net of California, Inc. v. Department of Health Services (2003) 113 Cal.App.4th
224, 234-235; see Hanna v. Lederman (1963) 223 Cal.App.2d 786, 792 (Hanna)
[tenant’s negligence claim based on violation of municipal code regarding fire sprinkler
systems was not precluded by landlord’s exculpatory clause if the violation was the
proximate cause of the tenant’s loss]; Halliday v. Greene (1966) 244 Cal.App.2d 482,
23
488-490 [exculpatory clause did not preclude tenant’s recovery against sublessor and
builder, who knew or should have known he built a staircase in violation of safety order];
Capri v. L.A. Fitness International, LLC (2006) 136 Cal.App.4th 1078, 1084 [no public
interest requirement for contract purporting to avoid liability for violation of law].)
Cal-Murphy urges that it presented evidence raising a factual question as to
whether (1) NOP/Hines’s conduct violated the Mechanical Code, and (2) NOP/Hines
committed a willful injury. We begin with the standard of review.
a. Standard of Review
As mentioned, the court’s decision to exclude evidence of damages in light of
section 7.04(a) was made in the context of NOP/Hines’s requests for case management
orders, which the court found akin to a motion in limine. Cal-Murphy urges that this
procedural context dictates our standard of review, such that we must accept as true not
only the allegations of the operative fifth amended complaint (as we would on a motion
for judgment on the pleadings), but also the allegations of the revised proposed sixth
amended complaint (which was never filed) and declarations submitted with respect to
other motions (which were not discussed at the case management hearing).
For this proposition, Cal-Murphy provides the following quotation from
Dillingham-Ray Wilson v. City of Los Angeles (2010) 182 Cal.App.4th 1396, 1402-1403
(Dillingham): “When all evidence on a particular claim is excluded based on a motion in
limine, the ruling is subject to independent review as though the trial court had granted a
motion for judgment on the pleadings or, if evidence was offered, a motion for nonsuit.
[Citations.] We must disregard adverse conflicting evidence, view the record in the light
most favorable to the plaintiff and determine whether the evidence and inferences were
sufficient to support a judgment in the plaintiff’s favor. [Citation.] If any issues were
decided during an in limine proceeding without evidence, we will accept as true the
evidence referenced in the plaintiff’s arguments and offers of proof.” (Italics added.)
Dillingham is distinguishable from the matter at hand. It is true that, at the hearing
on the requested case management orders, the court likened NOP/Hines’s set of requests
to an in limine motion. But throughout the hearing, the court and the parties treated this
24
particular portion of NOP/Hines’s requests as a motion for judgment on the pleadings,
debating whether the allegations of the fifth amended complaint could be read to assert
intentional or grossly negligent conduct so as to preclude application of section 7.04(a).
Indeed, when NOP/Hines’s attorney and the court insisted that the question was what was
alleged in the fifth amended complaint, and when the court ruled that the fifth amended
complaint did not contain sufficient allegations of intentional or grossly negligent
conduct to preclude enforcement of section 7.04(a), Cal-Murphy did not contend the
court was applying the wrong standard.
At any rate, even if Dillingham compelled us to accept as true the evidence
referenced in arguments and offers of proof at the hearing, Cal-Murphy did not make any
adequate offer of proof with specific evidence at the case management hearing.9 (See
Evid. Code, § 354.) And, to the extent Cal-Murphy now tries to rely on allegations cited
from its revised proposed sixth amended complaint, Cal-Murphy never obtained leave to
file that pleading and those allegations are not part of the case.
We therefore review the court’s order based on the allegations of the operative
fifth amended complaint.
b. Violations of the Mechanical Code
Cal-Murphy contends section 7.04(a) could not be enforced because NOP/Hines
violated provisions of the Mechanical Code. Its argument is unpersuasive.
In the first place, Cal-Murphy did not argue that violations of the Mechanical
Code by NOP/Hines rendered section 7.04(a) unenforceable in its written opposition to
the case management order. Nor did it raise this argument at the May 11, 2012, hearing
on NOP/Hines’s motion for the case management order. Instead, Cal-Murphy’s theory
was that section 7.04(a) did not apply because NOP/Hines’s conduct was intentional or
9
Cal-Murphy’s attorney said that he had “experts on top of experts that will testify
that you’ve got to know that you can’t do what they did” and “I’ve got evidence, I’ve
experts that are going to come in here and say that anybody who is knowledgeable about
this stuff, that they knew that this was going to happen.” But counsel did not refer by
name or specific substance to the declarations that Cal-Murphy now contends establish a
triable factual issue.
25
grossly negligent (discussed post). Because Cal-Murphy did not assert the argument, it is
unavailing here.
Furthermore, the allegations in the nuisance cause of action in the fifth amended
complaint did not actually base liability on a violation of the Mechanical Code. Instead,
the pleading asserted that NOP/Hines created a nuisance because it knew or should have
known that Mixt Greens’s equipment would emit odors and grease. Since no code
violation is alleged as the proximate cause of Cal-Murphy’s damages, section 1668 does
not bar enforcement of the exoneration clause.10 (Hanna, supra, 223 Cal.App.2d at pp.
788, 792.)
Cal-Murphy’s resort to allegations in its revised proposed sixth amended
complaint and an argument it made to the court in seeking leave to file that pleading, is
also unavailing. The sections of the Mechanical Code cited by Cal-Murphy do not apply
to the Type II duct NOP/Hines allowed Mixt Greens to install, but to Type I hoods. And
while Cal-Murphy retorts that a Type I hood should have been installed, it also alleged
that the city approved the installation. At any rate, as discussed ante, Cal-Murphy’s
allegations in its proposed pleading are immaterial, since they are not part of the case.
c. Willful Injury
Cal-Murphy next contends section 7.04(a) is unenforceable under section 1668
because NOP/Hines inflicted “willful injury to the person or property of another.”
(§ 1668.) The contention has no merit.
In paragraph 47 of its fifth amended complaint, Cal-Murphy alleged in its
nuisance claim that NOP/Hines “knew or reasonably should have known” that Mixt
10
The fifth amended complaint did generally mention purported violations of
ordinances and laws, not for the purpose of establishing liability, but so the emissions
might be described as a public type of nuisance. It also vaguely alleged elsewhere that
NOP/Hines knew or should have known that a different hood was required by
“applicable Codes of the City and County of San Francisco” notwithstanding the city’s
approval of the duct installation. In light of the city’s alleged approval, the pleading
alleges a determination of compliance with applicable codes, not a violation. In any
event, the nuisance cause of action was not predicated on a violation of the Mechanical
Code.
26
Greens’s cooking equipment would vent offensive odors through the ducts and
accumulate oil in the ducts. Elsewhere the fifth amended complaint alleged that
NOP/Hines “knew, or reasonably should have known,” that different equipment was
required than what the city had approved. These are allegations of negligence, however,
not “willful injury” to the person or property of another for purposes of section 1668.
They do not give rise to an inference of intentional acts or gross negligence in inflicting
injury, but mere negligence in allowing Mixt Greens to install certain equipment. Nor is
there any allegation that NOP/Hines had an intent to injure or knowledge that injury was
substantially likely to occur.
Accordingly, the court did not err in issuing its case management order that
evidence of damages should be excluded at trial or in granting NOP/Hines’s motion for
judgment on the pleadings on Cal-Murphy’s nuisance cause of action.11
E. Summary Adjudication of Third Cause of Action (Good Faith Covenant)
In its third cause of action, Cal-Murphy alleged numerous breaches of the
covenant of good faith and fair dealing implied in the Lease. NOP/Hines moved for
summary adjudication, which the trial court granted. Cal-Murphy now contends the court
erred as to three alleged breaches by NOP/Hines: (1) leasing space to Mixt Greens,
11
Cal-Murphy further contends the court erred because it decided the section 7.04
issue in the context of NOP/Hines’s requests for case management orders, claiming the
use of in limine motions in lieu of other dispositive motions has been criticized. (Citing
R & B Auto Center, Inc. v. Farmers Group, Inc. (2006) 140 Cal.App.4th 327, 371 (conc.
opn. of Rylaarsdam, Act. P.J.); Amtower v. Photon Dynamics, Inc. (2008) 158
Cal.App.4th 1582, 1593-1594.) The court’s case management order was within its
authority to manage complex litigation matters. (See Code Civ. Proc., §§ 128, 187; Govt.
Code, § 68607; Rutherford v. Owens-Illinois, Inc. (1997) 16 Cal.4th 953, 966-967;
Hernandez v. Superior Court (2003) 112 Cal.App.4th 285, 295; Cottle v. Superior Court
(1992) 3 Cal.App.4th 1367, 1381.)
27
(2) delaying installation of a blade sign for Murphy’s Deli, and (3) rejecting Murphy’s
Deli’s request to display a sandwich board.12
The implied covenant of good faith and fair dealing is intended to assure that the
parties receive the benefit of the bargain they reached in their written agreement. It is
therefore “limited to assuring compliance with the express terms of the contract,” and it
“cannot be extended to create obligations not contemplated in the contract.” (Racine &
Laramie, Ltd. v. Department of Parks & Recreation (1992) 11 Cal.App.4th 1026,
1032.) Nor can the covenant be used to prohibit conduct that the written agreement
expressly permits. (Carma Developers (Cal.), Inc. v. Marathon Development
California, Inc. (1992) 2 Cal.4th 342, 374, 376 (Carma); Wolf v. Walt Disney Pictures
& Television (2008) 162 Cal.App.4th 1107, 1120 (Wolf).) With these principles in
mind, we turn to Cal-Murphy’s claims.
1. Lease to Mixt Greens
Cal-Murphy alleged that NOP/Hines breached the implied covenant of good faith
by leasing adjacent space in the Building to Mixt Greens, which Cal-Murphy
characterized as a competing restaurant.
In its summary adjudication motion, NOP/Hines contended it was allowed to lease
to Mixt Greens under the terms of the Lease. NOP/Hines pointed to Lease section
3.03(c), entitled “No Exclusivity; Menu,” which stated that Cal-Murphy had no exclusive
right to operate a restaurant in the Building: “Tenant acknowledges that Tenant does not
have the exclusive right to operate a restaurant or a sundry retail establishment in the
Project or the exclusive right to sell any item which Tenant is permitted to sell
hereunder.”
In addition, NOP/Hines pointed to sections in the Lease stating that NOP/Hines
could lease space to any tenant it wanted. Section 5.07(j) of the Lease read: “Without
12
NOP/Hines moved for summary adjudication based on Cal-Murphy’s fourth
amended complaint. While the summary adjudication motion was pending, Cal-Murphy
filed its fifth amended complaint. The court concluded it could still rule on the summary
adjudication motion, because the fifth amended complaint did not change the relevant
allegations in the fourth amended complaint. No error is asserted in this regard.
28
liability to Tenant, Landlord shall have the right to offer and to lease space in the
Building, or in any other property, to any party, including without limitation to any party
with whom Tenant desires to negotiate, concerning assignment or subletting the Leased
Premises, or any portion thereof.” (Italics added.) And section 1.27 referenced
NOP/Hines’s right to lease to any tenant of its choice with the phrase “without Limiting
Landlord’s right to lease any portion of the Building to a tenant of Landlord’s choice.”
(Italics added.)
Cal-Murphy opposed the summary adjudication motion, contending the Lease
could be construed to bar NOP/Hines from leasing to a competitor in light of extrinsic
evidence considered under the parol evidence rule and the doctrine of practical
construction. Specifically, Cal-Murphy offered evidence of statements made on behalf of
NOP/Hines, during the negotiation of the Lease, that NOP/Hines did not intend to install
a competitive operation and did not grant an exclusivity clause because it wanted to be
able to install a complementary restaurant. In addition, Cal-Murphy offered evidence of
NOP/Hines’s conduct after the execution of the Lease, contending it reflected an
understanding that NOP/Hines could lease only to complementary restaurants: Karen
Hoke, the broker attempting to find a tenant for the space next to Mixt Greens, had
targeted a sushi restaurant as a complementary operation and turned down a couple of
prospective tenants because their menu overlapped with Murphy’s Deli; and there was an
inquiry within NOP/Hines as to the potential for installing a sandwich and coffee
operation next to Murphy’s Deli.
The trial court provisionally considered the extrinsic evidence, but ultimately
concluded the Lease was not reasonably susceptible to the interpretation Cal-Murphy
asserted. Accordingly, it granted summary adjudication on Cal-Murphy’s claim for
breach of the good faith covenant in leasing to Mixt Greens.
The court did not err. As we shall explain, the Lease did not forbid NOP/Hines
from leasing to a competitor of Murphy’s Deli, the evidence of statements concerning
NOP/Hines’s intent to lease to a complementary restaurant did not render the provisions
29
of the Lease ambiguous, and attempts to lease to a complementary restaurant did not
reflect an understanding that NOP/Hines could only lease to a complementary restaurant.
a. The Lease to Mixt Greens Was Permitted by the Lease
Sections 3.03(c) and 5.07(j) of the Lease are express and unambiguous. Cal-
Murphy had no right to operate the only restaurant in the Building, and NOP/Hines
could lease space to any tenant it wanted (as confirmed under the assignment and
subletting provisions of section 5.07). At the very least, no provision of the Lease
precluded NOP/Hines from leasing to a competitor of Murphy’s Deli or required
NOP/Hines to lease only to a complementary restaurant. Because the implied covenant
of good faith cannot create an obligation not contemplated by the contract, or prohibit
conduct the written agreement permits, Cal-Murphy has no cause of action for breach of
the covenant based on leasing space to Mixt Greens. (See Carma, supra, 2 Cal.4th at
p. 374; Stockton Dry Goods Co. v. Girsh (1951) 36 Cal.2d 677, 680-681 [a covenant
restricting a lessor’s use of retained property must be shown by clearly stated intention].)
b. Parol Evidence Did Not Support a Contrary Interpretation
When parties offer two plausible interpretations of the contractual language, the
language is ambiguous and parol evidence is admissible to aid in its interpretation. (Casa
Herrera, Inc. v. Beydoun (2004) 32 Cal.4th 336, 343.) In some instances, parol evidence
may render an ostensibly unambiguous contract ambiguous. (Abers v. Rounsavell (2010)
189 Cal.App.4th 348, 356-357 [ambiguity exists only “when contractual language
reasonably may be susceptible to more than one interpretation based upon the offered
evidence regarding the material facts”].) If the parol evidence is in conflict, there is a
question of fact that precludes summary judgment. (WYDA Associates v. Merner (1996)
42 Cal.App.4th 1702, 1710.)
Here, the extrinsic evidence proffered by Cal-Murphy did not make the Lease
ambiguous. The evidence that NOP/Hines expressed an intent to lease to a
complementary establishment, and not to a competitor of Murphy’s Deli, was simply a
statement of what NOP/Hines intended to do, not what the Lease required it to do.
There was no evidence that NOP/Hines made the statements based on its understanding
30
of the Lease, believed or represented it was precluded by the Lease from leasing to
whomever it wanted, or thought the Lease language really meant that NOP/Hines could
lease only to a complementary operation. Simply put, despite the evidence Cal-Murphy
presented, the Lease is not susceptible of the meaning Cal-Murphy asserts.
c. The Practical Construction Doctrine Does Not Apply
Under the practical construction doctrine, the parties’ acts after signing the
contract, but before a controversy has arisen, may be considered in discerning their
understanding of the contract language. (Warner Constr. Corp. v. City of Los Angeles
(1970) 2 Cal.3d 285, 296-297.)
Here, the practical construction doctrine does not assist Cal-Murphy. In the first
place, the doctrine cannot be invoked where the contract is unambiguous and the
proffered evidence does not support an interpretation to which the contract is reasonably
susceptible. (See Crestview Cemetery Assn. v. Dieden (1960) 54 Cal.2d 744, 754.)
Moreover, Cal-Murphy’s evidence does not show the parties’ construction of the
Lease. Although NOP/Hines was looking for a tenant with a menu complementary to the
menu of Murphy’s Deli, there is no evidence it did so based on an interpretation of the
Lease, or that NOP/Hines believed it was required under the Lease to find a
complementary restaurant. Brownstone said, “[W]e had hoped to find a food service that
would . . . [¶] . . . complement the food service that Murphy’s provided, so that the
tenants would have a variety of food to choose from.” (Italics added.) And while broker
Hoke sought a complementary restaurant for the space adjacent to Murphy’s Deli, there is
no evidence she felt constrained to do so by her understanding of the Lease terms.
The court did not err in granting summary adjudication as to the Mixt Greens
lease.
2. Blade Sign
Cal-Murphy also alleged that NOP/Hines breached the implied covenant of good
faith by delaying the installation of a blade sign that advertised Murphy’s Deli.
Specifically, it alleged that in January or February 2006, NOP/Hines’s building manager
(Brownstone) advised Cal-Murphy’s operations manager (Katwan) that NOP/Hines
31
would install a blade sign at its own cost. This statement, Cal-Murphy alleged, modified
Lease section 4.04 (which gave the tenant a right to a sign on the exterior of the Building,
subject to the Landlord’s approval, at the tenant’s cost), by an “executed oral agreement.”
Cal-Murphy further alleged that NOP/Hines obtained artwork from Cal-Murphy, granted
approval, and notified Cal-Murphy in February 2007 that the sign would be installed
within four weeks, but did not install the sign until April 2008. The sign was installed at
NOP/Hines’s expense.
In its motion for summary adjudication, NOP/Hines argued there was no breach of
the covenant of good faith implied in the Lease, since section 4.04 pertained to signs
installed by Cal-Murphy, not NOP/Hines. Furthermore, pursuant to section 7.14, the
Lease could not be modified orally, and in any event the Lease was not modified by an
executed oral agreement.
In opposition to the summary adjudication motion, Cal-Murphy argued there was a
triable issue whether the delay in installing the blade sign deprived Cal-Murphy of its
right to a sign under section 4.04, and NOP/Hines waived or was estopped to rely on the
condition that Cal-Murphy pay for the sign or provide the design. Cal-Murphy presented
evidence to support the facts alleged in its pleading, as well as a declaration from Katwan
that NOP/Hines declined installation of the sign in 2007 unless Cal-Murphy paid for it,
but relented later that year.
The court determined that Cal-Murphy’s evidence of waiver and estoppel was
insufficient to modify section 4.04, and Cal-Murphy had no claim for breach of the
implied covenant based on a delay in installing the blade sign.
The grant of summary adjudication was not erroneous. As we discuss next, the
Lease did not require NOP/Hines to install any sign for Cal-Murphy at NOP/Hines’s
expense, the Lease permitted modification only in writing, and Cal-Murphy’s evidence
32
did not create a triable issue of material fact that it could recover under the Lease for
NOP/Hines’s delay in installing a sign at NOP/Hines’s expense.13
a. The Lease Did Not Compel NOP/Hines to Install a Blade Sign
Section 4.04 of the Lease, entitled “Graphics and Signage,” gave Cal-Murphy a
right to install an exterior sign, at its own expense, subject to NOP/Hines’s approval.
Section 4.04 provided in relevant part: “Tenant shall have the right to install, at Tenant’s
sole cost and expense, a sign on the exterior surface of the front entry of the Leased
Premises with Tenant’s trade name of such design, size and color, and in such location on
the Leased Premises as approved by Landlord in advance.” (Italics added.) Section 4.04
does not provide that NOP/Hines would design a blade sign for Cal-Murphy, install it, or
pay for it.
Because the Lease does not require NOP/Hines to install a sign for Cal-
Murphy at its own expense, and the implied covenant of good faith can neither create
an obligation not contemplated by the Lease or prohibit conduct the Lease permits,
Cal-Murphy has no cause of action for breach of the implied covenant based on
NOP/Hines’s installation of its own designed sign for Cal-Murphy.
b. Cal-Murphy’s Reliance on Civil Code Section 1698 is Misplaced
Cal-Murphy contends that, even though section 7.14 precluded an oral
modification of the Lease, Civil Code section 1698 (section 1698) permits an oral
modification by waiver or estoppel, and Cal-Murphy presented sufficient evidence to
create a “triable issue that NOP/Hines waived or are estopped to rely on the provisions in
the Lease that Cal-Murphy must pay for any sign.”
At the outset, we point out that section 1698 does not assist Cal-Murphy. Section
1698 provides that a contract in writing may be modified by a contract in writing, an
13
Cal-Murphy does not allege or contend that NOP/Hines breached a separate oral
agreement to install a blade sign for Cal-Murphy, at NOP/Hines’s expense, in a timely
manner, independent from the provisions of the Lease. Instead, it contends that NOP/Hines
is precluded by waiver or estoppel from asserting rights under the Lease, which thereby
modifies the Lease, such that NOP/Hines’s delay in installing the sign breached the implied
covenant under the Lease (as opposed to any express term of the Lease), resulting in a loss of
customers.
33
executed oral agreement, or an oral agreement supported by new consideration (unless
the written contract provides otherwise). (§ 1698, subds. (a)-(c).) None of those
provisions applies here.14 Instead, Cal-Murphy relies on subdivision (d) of the statute,
which reads: “Nothing in this section precludes in an appropriate case the application of
rules of law concerning estoppel . . . [or] waiver of a provision of a written contract, or
oral independent collateral contracts.” (Italics added.) In other words, although section
1698 may not bar the application of waiver and estoppel in an otherwise appropriate
situation, it does nothing on its own to establish the waiver and estoppel Cal-Murphy
asserts. We therefore turn to Cal-Murphy’s evidence.
c. Evidence of Waiver
Waiver is the voluntary relinquishment of a known right. (See, e.g., Utility
Audit Co., Inc. v. City of Los Angeles (2003) 112 Cal.App.4th 950, 959 [“Waiver
requires an existing right, benefit, or advantage, actual or constructive knowledge of
the right’s existence, and either an actual intention to relinquish it or conduct so
inconsistent with any intent to enforce the right as to induce a reasonable belief that it
has been relinquished”].)
Here, Cal-Murphy presented no evidence from which a reasonable trier of fact
could conclude that NOP/Hines intended to waive its rights under section 4.04 of the
Lease. In offering to install a sign for Cal-Murphy at its own cost, NOP/Hines created
a separate arrangement for signage; there is no evidence that it was intending to waive
its right under section 4.04 not to pay for a sign that Cal-Murphy would seek to install.
Furthermore, even if NOP/Hines had waived its right under section 4.04 to
require Cal-Murphy to pay for a sign that Cal-Murphy sought to install, Cal-Murphy
14
Cal-Murphy did not pursue its argument in the fourth amended complaint that the
Lease was modified by an executed oral agreement. The fifth amended complaint
alleged that NOP/Hines either waived section 4.04 insofar as it required Cal-Murphy to
pay for, design, or obtain approval for the blade signs, or was estopped to deny that the
Lease was modified to eliminate any requirement that Cal-Murphy pay for, design, or
obtain approval for the sign.
34
never sought to install one of its own signs. Instead, it opted to wait until NOP/Hines
installed the blade sign at NOP/Hines’s own expense.
Lastly, even if NOP/Hines had waived its right under section 4.04 to require
Cal-Murphy to pay for any Murphy’s Deli sign—whether installed by Cal-Murphy or
installed by NOP/Hines—NOP/Hines, not Cal-Murphy, paid for the sign. In short, any
factual issue over a possible waiver does not support Cal-Murphy’s claim for breach of
the implied covenant of good faith.
d. Evidence of Estoppel
Similarly, Cal-Murphy’s estoppel evidence does not establish a triable issue of
material fact. Even if NOP/Hines was estopped from asserting its right under section
4.04 of the Lease not to pay for a sign, section 4.04 only pertained to signage that Cal-
Murphy might choose to install, and Cal-Murphy never attempted to install a sign.
And even if Cal-Murphy’s evidence was sufficient to estop NOP/Hines from claiming
it did not have to pay for the installation of any sign—including the blade sign that
NOP/Hines was making—it is undisputed that NOP/Hines did pay for the blade sign.
Nor is there any basis for concluding, under a slightly different approach, that
NOP/Hines should be estopped from denying that the Lease was modified to eliminate
the requirement that Cal-Murphy pay for, design, or obtain approval for the sign.
There is no evidence that NOP/Hines acted in a manner that would justifiably lead
Cal-Murphy to believe that the Lease was being modified in that regard.
The court did not err in granting summary adjudication as to the blade sign.
3. Sandwich Board
Cal-Murphy alleged that NOP/Hines breached the implied covenant of good faith
and fair dealing by permitting it to display a sandwich board for only five weeks or so in
April and May 2005, while later allowing Mixt Greens to display one for a longer period.
In its motion for summary adjudication, NOP/Hines denied liability based on
Lease provisions that gave it discretion to allow such a sign or not. Specifically,
NOP/Hines pointed to a part of section 4.04, which read: “Tenant shall not, without the
prior written consent of Landlord (which may be given or withheld in the sole discretion
35
of Landlord), place or permit to be placed, . . . any sign, advertising material or lettering
upon the exterior of the Leased Premises.” (Italics added.) In addition, section 2.02 of
the Lease provided that, subject to certain exceptions, “Landlord shall have the sole and
exclusive right to possession and control of the Common Areas and all other areas of the
Project outside the Leased Premises.” Given this discretion, NOP/Hines argued, Cal-
Murphy could not state a claim based on a breach of the implied covenant of good faith
as a matter of law.
In opposing summary adjudication, Cal-Murphy urged that NOP/Hines’s
discretion under section 4.04 applied only to signs on the exterior or interior surfaces of
the Building (not to a sandwich board on the sidewalk), and section 2.02 allowed
NOP/Hines to approve the sandwich board. Cal-Murphy also presented the following
evidence: building manager Brownstone told the on-site manager for Murphy’s Deli
(Dudum) that Murphy’s Deli could use a sandwich board; Dudum had a sandwich board
made and showed it to another building manager, who allowed Cal-Murphy to display the
sign for roughly five weeks in April and May 2005; and in or after April 2008 Mixt
Greens used a sandwich board for a longer period.
The court granted summary adjudication on the ground that, in light of section
7.14 requiring Lease modifications to be in writing, extrinsic evidence did not create a
material triable issue concerning the signage provisions.
a. No Breach of the Implied Covenant in the Lease
Where a contract expressly grants a party sole discretion over a decision, the
exercise of that discretion is not limited by the implied covenant of good faith. (Thrifty
Payless, Inc. v. Mariners Mile Gateway, LLC (2010) 185 Cal.App.4th 1050, 1062
[“[T]he implied covenant cannot be used to limit or restrict an express grant of
discretion to one of the contracting parties”]; Third Story Music, Inc. v. Waits (1995) 41
Cal.App.4th 798, 808 [“[C]ourts are not at liberty to imply a covenant directly at odds
with a contract’s express grant of discretionary power”]; Wolf, supra, 162 Cal.App.4th
at pp. 1120-1123 [party’s right to license franchise as it “ ‘saw fit’ ” is not limited by
implied covenant, because implied covenant cannot limit unfettered discretion granted
36
by contract]; cf. Carma, supra, 2 Cal.4th at p. 372 [noting that party must exercise
discretionary power in “good faith”; that is, a good faith pursuit of its rights and
objectives under the contract].)
Here, the Lease granted NOP/Hines sole discretion to decide whether, and to what
extent, the likes of a sandwich board would be allowed on the premises: section 4.04
granted NOP/Hines authority to approve or reject, within its “sole discretion,” any sign
“upon the exterior of the Leased Premises”; and section 2.02 gave NOP/Hines the “sole
and exclusive right” to control common areas and areas “outside” the leased premises.
Cal-Murphy asked NOP/Hines’s permission to display a sandwich board and
NOP/Hines decided to grant permission for about five weeks. The implied covenant
cannot be invoked to limit NOP/Hines’s discretionary choice under these facts.
b. No Triable Issue of Material Fact
Cal-Murphy tries to create a triable issue by contending section 4.04 was modified
by the parties’ oral agreement, NOP/Hines is estopped from denying that it approved the
installation of a sandwich board, and NOP/Hines waived the Lease provisions relevant to
sandwich boards.
Cal-Murphy’s arguments lack merit. In the first place, akin to our analysis ante
regarding the blade sign, we find no triable issue concerning a modification of section
4.04 or a waiver or estoppel precluding reliance on its terms: there is no evidence that
NOP/Hines intended to relinquish its discretionary authority under the Lease with
respect to Cal-Murphy’s proposed sandwich board. Moreover, even if NOP/Hines’s
statements to Dudum meant NOP/Hines was precluded by waiver or estoppel from
withholding approval of the sandwich board, the result would simply be that NOP/Hines
was entitled to display the sandwich board consistent with NOP/Hines’s statements: that
is, in April to May 2005. And that was precisely what Cal-Murphy was allowed to do.
Accordingly, the court did not err in granting summary adjudication on Cal-
Murphy’s third cause of action for breach of the implied covenant of good faith and fair
dealing. As this exhausts Cal-Murphy’s attacks on the judgment entered in favor of
NOP/Hines, the judgment will be affirmed.
37
F. Dismissal of Action Against MGR
The trial court sustained MGR’s demurrer to the fifth amended complaint on the
ground that no viable cause of action was alleged against it, and denied leave to amend.
The court subsequently denied Cal-Murphy’s motion for relief from that order. Cal-
Murphy contends the court erred, both in denying leave to amend and in denying relief.
1. Sustaining Demurrer Without Leave to Amend
a. Background
In February 2012, four years after commencing this action, Cal-Murphy
substituted MGR for Doe One as to the fifth, sixth, seventh and ninth causes of action in
the fifth amended complaint as successor to Mixt Greens.
On March 28, 2012, MGR filed a demurrer to the causes of action asserted against
it in the fifth amended complaint. A hearing was set for May 7, 2012. Cal-Murphy did
not file any opposition to the demurrer.
Meanwhile—as we have described ante—in April 2012 the court granted
NOP/Hines’s motion for judgment on the pleadings as to the ninth cause of action
(trespass by grease) and advised that it would consider Cal-Murphy’s amendment of that
cause of action on May 7, 2012. On April 23, 2012, Cal-Murphy filed a declaration by
its attorney, entitled “Declaration of Herbert W. Yanowitz In Connection With Proposed
Sixth Amended Complaint,” attaching a proposed sixth amended complaint that
contained not just an amendment to the trespass claim, but new allegations as to MGR as
well.
On April 30, 2012, MGR filed a reply brief asserting that its demurrer should be
sustained in light of Cal-Murphy’s failure to file any opposition. MGR also argued that
leave to amend should not be granted, in light of deficiencies in the proposed sixth
amended complaint, its novel allegations, its failure to allege any viable cause of action,
and the burden and prejudice it would cause in the case.
At the hearing on MGR’s demurrer on May 7, 2012, the court announced its
tentative ruling: “In light of failure to file an opposition, the demurrers to the Fifth
Amended Complaint are all sustained without leave to amend.”
38
Cal-Murphy’s attorney, Herbert Yanowitz, argued that he did not file an
opposition to the demurrer because (1) he thought Cal-Murphy could file an amendment
as a matter of right; (2) filing an amended complaint would be preferable to filing an
opposition to the demurrer because it “saves a step and saves paper”; and (3) the
proposed sixth amended complaint was in the record, submitted in connection with the
proceedings on the ninth cause of action for trespass. Yanowitz also asserted his mistake
should be excused.
The court pointed out that Cal-Murphy was not entitled to amend the fifth
amended complaint as of right, and in any event Yanowitz did not file any amendment to
the claims against MGR (and could not have because he needed leave to file a sixth
amended complaint). The court further noted that Yanowitz did not make a mistake in
this regard, but a “strategic volitional decision based on saving paper or whatever it was,”
which did not justify the failure to file a response to the demurrer. The court then
discussed the interests of justice: “All of the parties have a right to justice in this
courtroom. And all of the parties have a right to an efficient articulation of what the
claims are against them and a reasonable progress towards the resolution of those, free of
undue expense and . . . time.” The court added: “As a matter of fact, we have discussed
on the record my concerns that many of the claims that you might have against [MGR]
don’t belong in this case. And also my concern that this case is going to go to trial soon
or some other disposition soon, and that we will not have the never ending story of your
continuing claims against these people.” Yanowitz proceeded to describe the new facts
in the proposed sixth amended complaint, but he did not demonstrate how they would
establish a viable claim against MGR.
The court ruled that the demurrers would be sustained without leave to amend and
issued a written order that same day. The court thereafter entered a dismissal of MGR.
b. No Abuse of Discretion
Cal-Murphy does not dispute that the fifth amended complaint failed to state a
cause of action against MGR. Instead, it contends the court erred in not granting Cal-
Murphy leave to amend the pleading as to MGR.
39
We review a denial of leave to amend for an abuse of discretion. (Debro v.
Los Angeles Raiders (2001) 92 Cal.App.4th 940, 946.) To prevail on appeal, an appellant
must usually demonstrate a reasonable possibility that the defects in the complaint can be
cured by amendment. (E.g., Schifando v. City of Los Angeles (2003) 31 Cal.4th 1074,
1081.) Thus, Cal-Murphy must show how the amended complaint could further be
amended and how, as so amended, the pleading would state a cause of action. (Buller v.
Sutter Health (2008) 160 Cal.App.4th 981, 985-986.)
The court did not abuse its discretion in denying leave to amend. In the first place,
Cal-Murphy did not demonstrate that it could allege a viable claim against MGR. There
was no filing in the demurrer proceeding setting forth a basis for its new allegations; and
even after MGR argued in its reply papers that leave to amend should not be granted due
to the substantive deficiencies of the proposed sixth amended complaint and its
prejudicial impact on the proceedings, Cal-Murphy did not explain at the demurrer
hearing how its proposed sixth amended complaint stated a cause of action against MGR.
Furthermore, it became apparent at the demurrer hearing that Cal-Murphy’s
proposed amendment of the fifth amended complaint as to MGR would be a sixth
amended complaint affecting multiple parties. As such, granting leave to amend as to
MGR would not have been akin to the initial amendment liberally permitted early in a
lawsuit. Instead, it implicated concerns for other parties and the case overall. As
discussed ante, it was not an abuse of discretion to conclude that the timing of the
proposed amendment was unduly prejudicial.
Cal-Murphy contends the court sustained the demurrer without leave to amend
solely because Cal-Murphy had not filed an opposition, and did not consider the
allegations in the proposed sixth amended complaint or whether Cal-Murphy could cure
the deficiencies in its fifth amended complaint. Not so. Given the court’s comments at
the hearing as a whole, the better interpretation is that the court declined to grant leave to
amend because, due to the absence of any opposition being filed, no argument had been
made in the demurrer proceeding as to the propriety of any proposed amendment, and the
40
court’s concerns had not been addressed.15 In any event, we may uphold the court’s
decision on any valid ground, whether the court expressly relied on it or not. (D’Amico,
supra, 11 Cal.3d at pp. 18-19.)
Lastly, Cal-Murphy argues that the trial court did not correctly address the
question of prejudice: it claims NOP/Hines was “effectively out of the case” and the only
new discovery would be related to “successor liability.” While Cal-Murphy may have
had such an argument for granting leave to amend, it does not establish that the trial court
abused its discretion in ruling otherwise.
2. Denial of Motion for Relief
Cal-Murphy sought relief from the order sustaining MGR’s demurrer without
leave to amend (and the dismissal of MGR) under subdivision (b) of Code of Civil
Procedure section 473 (section 473). That statute gives the court discretion to provide
relief from an order in certain circumstances, and mandates relief in others.
a. Background
After sustaining MGR’s demurrer but before receiving Cal-Murphy’s section 473
motion, the court held a continued hearing on Cal-Murphy’s request to file its proposed
sixth amended complaint. The court remarked that the proposed pleading appeared
inappropriate, but gave Cal-Murphy another chance. On May 15, 2012, Cal-Murphy
filed a declaration of its attorney, Herbert Yanowitz, attaching a revised proposed
pleading. As discussed ante, the court denied Cal-Murphy’s motion to file the revised
proposed sixth amended complaint on May 18.
15
At the outset of the demurrer hearing, the court indicated the tentative ruling was
“in light of [the] failure to file an opposition,” and at the end of the hearing it announced
that the tentative ruling would stand. But during the demurrer hearing, the court also
spoke at length regarding the interests of justice and the court’s substantive concerns
about Cal-Murphy’s claims. Similarly, at the hearing on the ensuing motion for relief
under Code of Civil Procedure section 473, the court suggested the demurrer had been
sustained without leave to amend due to Cal-Murphy’s inappropriate claims, but later at
the hearing indicated it was “for failure to file a response.” These statements are not in
conflict, but signal that the demurrer was sustained without leave to amend because there
was no opposition filed and therefore no demonstration of why leave to amend should be
granted.
41
On May 24, 2012, Cal-Murphy filed its section 473 motion for relief from the
order sustaining MGR’s demurrer to the fifth amended complaint without leave to amend
(and the judgment of dismissal), claiming they were taken due to mistake, inadvertence,
surprise or excusable or inexcusable neglect. In a declaration, attorney Yanowitz averred
that he thought he could amend the fifth amended complaint as to MGR without court
permission pursuant to Code of Civil Procedure section 472, elected not to file an
opposition to the demurrer, but filed a “Declaration . . . in Connection With Proposed
Sixth Amended Complaint,” which attached the proposed pleading with claims against all
parties.16
The hearing on Cal-Murphy’s section 473 motion took place on June 18, 2012.
The court noted its earlier determination that the proposed sixth amended complaint was
not appropriate to file: it contained many matters the court had already decided; other
claims were inappropriate to add to the case, at least so late in the proceedings; and the
claims against MGR went beyond merely adding a successor entity as a Doe defendant.
In light of this history, the court found, it was not a mistake or inadvertence that caused
the demurrer to the fifth amended complaint to be sustained, but the attempt to add MGR
into the case with inappropriate claims and to file a sixth amended complaint that did not
properly reflect prior court orders.
Cal-Murphy insisted that the demurrer had actually been sustained without leave
to amend because no opposition was filed, and there was no discussion at the demurrer
hearing of the impropriety of the claims in the proposed sixth amended complaint. The
court noted that Cal-Murphy had not attached a new proposed pleading to its request for
section 473 relief, but declarations attaching the revised proposed sixth amended
complaint that the court had already found inappropriate. Cal-Murphy confirmed it was
standing pat on this rejected pleading.
16
The opposition to the demurrer was due on April 24; Yanowitz filed his
declaration and proposed sixth amended complaint on April 23, but that was because he
had 10 days from the ruling on the ninth cause of action to file it.
42
The court ruled: “The motion for relief under CCP Section 473 is denied. The
claimed mistake, inadvertence, surprise or excusable neglect did not cause the entry of
the order. What caused it was the failure to have, despite repeated attempts to do so, and
my repeated willingness to give you an opportunity to provide a viable mechanism [for
going] forward. That would be a Sixth Amended Complaint. [¶] In addition, the
attachment of what I had previously stated was not sufficient to your declaration filed in
connection with this motion, filed on May 23rd, 2012. That is your present declaration
attaching your prior declaration, does not satisfy the requirements of CCP Section 473 to
attach a copy of what it is you want to have filed.”
b. No Error in Denying Discretionary Relief
The discretionary portion of section 473 reads: “The court may, upon any terms as
may be just, relieve a party or his or her legal representative from a judgment, dismissal,
order, or other proceeding taken against him or her through his or her mistake,
inadvertence, surprise, or excusable neglect. Application for this relief shall be
accompanied by a copy of the answer or other pleading proposed to be filed therein . . . .”
(§ 473, subd. (b), italics added.) “Excusable neglect” arises if “ ‘a reasonably prudent
person under the same or similar circumstances’ might have made the same error.”
(Solv-All v. Superior Court (2005) 131 Cal.App.4th 1003, 1007 (Solv-All).)
The court acted within its broad discretion in declining relief based on the
purported mistake or excusable neglect of Cal-Murphy’s attorney. Cal-Murphy’s
argument, essentially, was that the demurrer was sustained without leave to amend due to
Yanowitz’s failure to file an opposition, and the opposition was not filed because
Yanowitz thought an amended complaint as to MGR could be filed as of right pursuant to
Code of Civil Procedure section 472 (section 472). For several reasons, this argument
was meritless.
First, Yanowitz’s reliance on section 472 did not constitute excusable neglect or
mistake. Section 472 provides: “Any pleading may be amended once by the party of
course, and without costs, at any time before the answer or demurrer is filed, or after
demurrer and before the trial of the issue of law thereon, by filing the same as amended
43
and serving a copy on the adverse party.” But Cal-Murphy did not file any amendment
by the time of the hearing on MGR’s demurrer—and, as Yanowitz knew, he could not
have filed (and did not file) the proposed sixth amended complaint because he needed
leave of court. Section 472, therefore, had no possible application. Furthermore, nothing
in section 472 or the Rutter Group text Yanowitz purportedly reviewed indicates that a
sixth amended complaint can be filed without leave of court after the hearing on a
demurrer, and no reasonable attorney would reach that conclusion.17
Second, Yanowitz’s view of section 472 did not cause Cal-Murphy’s failure to file
an opposition to the demurrer. To the contrary, Yanowitz averred in his declaration that
he opted not to file an opposition based on his concerns of efficiency: “In view of the
absence of charging allegations in the Fifth Amended Complaint, I believed that there
was no legitimate basis for the Plaintiff to oppose MGR’s demurrer. I believed that it
would be more efficient merely to file the [Proposed] Sixth Amended Complaint against
MGR, NOP/Hines, and Mixt Greens, rather than to file one pleading entitled ‘Opposition
to Demurrer,’ to which I would file a separate proposed further amended complaint that
applied to MGR only, and a separate pleading with the proposed amendments vis-à-vis
NOP/Hines and Mixt Greens. [¶] Accordingly, I did not file any opposition to the
demurrer.” (Italics added; paragraph numbers omitted.)
Third, Yanowitz’s view of section 472 did not justify failing to file an opposition
to the demurrer—or at least some written request for leave to amend and explanation of
the propriety of the amendment—in the specific context of the demurrer hearing.
17
The Rutter Group passage notes: “[I]t has been argued that, where a demurrer has
been sustained with leave to amend and plaintiff files an amended complaint, the
amended complaint may also be amended once without leave of court before defendant
answers or demurs. [¶] However, there is no known case permitting this. In addition, the
statutory wording—‘Any pleading may be amended once’—may be interpreted to
preclude an amendment to an amended pleading.” (Weil & Brown, Cal. Practice Guide:
Civil Procedure Before Trial (The Rutter Group 2013), § 6.610.5, p. 6-156, italics in
original.) Besides the obvious cautionary language in this passage, a competent reading
discloses that even this broad interpretation of section 472 had absolutely nothing to do
with the situation confronting Yanowitz, since it discusses amending the pleading “before
defendant answers or demurs.” (Italics added.) MGR had already filed its demurrer.
44
Regardless of his take on section 472, there was no reason not to file a specific document
with a title that would lead the court to consider it along with the demurrer.
Finally, as discussed ante, it was ultimately not Cal-Murphy’s failure to file an
opposition, but the broader failure to establish any right or good cause to amend, that
resulted in the demurrer being sustained without leave to amend. The court was well
within its discretion to deny relief under section 473.
c. No Error in Denying Relief Under Mandatory Provisions
The mandatory relief provision in section 473 reads as follows: “Notwithstanding
any other requirements of this section, the court shall, whenever an application for relief
is made no more than six months after entry of judgment, is in proper form, and is
accompanied by an attorney’s sworn affidavit attesting to his or her mistake,
inadvertence, surprise, or neglect, vacate any (1) resulting default entered by the clerk
against his or her client, and which will result in entry of a default judgment, or
(2) resulting default judgment or dismissal entered against his or her client, unless the
court finds that the default or dismissal was not in fact caused by the attorney’s mistake,
inadvertence, surprise, or neglect.” (Italics added.) Unlike the discretionary provision in
the statute, the neglect referred to in this mandatory provision need not be excusable.
(§ 473, subd. (b).)
Cal-Murphy argues it was entitled to relief because its attorney declared that the
failure to file an opposition to the demurrer occurred as a result of his neglect, without
Cal-Murphy’s knowing participation, and the demurrer was sustained without leave to
amend as a result.
Assuming, without deciding, that the mandatory provisions of section 473 might
theoretically afford relief from a dismissal obtained after a demurrer is sustained without
45
leave to amend,18 we agree with the trial court that the dismissal entered against Cal-
Murphy “was not in fact caused by [its] attorney’s mistake, inadvertence, surprise, or
neglect.” (§ 473, subd. (b).) As mentioned ante, the dismissal was not due to counsel’s
erroneous view of section 472, but due to the failure to show by written opposition any
viable basis for amendment; and the failure to file a written opposition reflected a tactical
decision.19 (See Jerry’s Shell, supra, 134 Cal.App.4th at pp. 1069-1074; Pagarigan v.
Aetna U.S. Healthcare of California, Inc. (2007) 158 Cal.App.4th 38, 46.)
In any event, Cal-Murphy confirmed at the section 473 hearing that its proposed
amendment to the fifth amended complaint as to MGR was its revised proposed sixth
amended complaint—which the court had already ruled to be inappropriate—thus making
it patently clear that granting relief under section 473 would lead only to the futility of a
sixth amended complaint the court had already rejected. Accordingly, there was no basis
for granting relief. (See Page v. Insurance Co. of North America (1969) 3 Cal.App.3d
121, 130; Bethlahmy v. Customcraft Industries, Inc. (1961) 192 Cal.App.2d 308, 310.)
18
The parties dispute this point, citing cases they contend lead to contrary
conclusions. (E.g., Jerry’s Shell v. Equilon Enterprises, LLC (2005) 134 Cal.App.4th
1058, 1069-1074 (Jerry’s Shell); English v. IKON Business Solutions, Inc. (2001) 94
Cal.App.4th 130, 148; Avila v. Chua (1997) 57 Cal.App.4th 860, 868.) But it cannot be
said that the order sustaining the demurrer without leave to amend in this case was
tantamount to a default: Cal-Murphy’s counsel appeared at the demurrer hearing and had
the opportunity to argue the merits of whether leave to amend should be granted.
19
The cases on which Cal-Murphy relies are distinguishable in this regard. (SJP
Limited Partnership v. City of Los Angeles (2006) 136 Cal.App.4th 511, 516-517
[reversing dismissal after party failed to appear because its attorney had advised that no
appearance was necessary and a dismissal could not be entered]; Solv-All, supra, 131
Cal.App.4th 1003, 1009 [reversing entry of default against a defendant due to the
attorney’s mistaken belief that the parties were on the verge of a settlement and the
plaintiff did not expect a response].)
46
Cal-Murphy fails to establish a prejudicial abuse of discretion.20
G. Demurrer and Dismissal as to Individual Plaintiffs
The trial court sustained NOP/Hines’s demurrer as to the Individual Plaintiffs on
the ground they were not real parties in interest. Appellants contend this was error.
“Every action must be prosecuted in the name of the real party in interest, except
as otherwise provided by statute.” (Code Civ. Proc., § 367.) A real party in interest is
one who possesses the right sued upon. (Buckland v. Threshold Enterprises, Ltd. (2007)
155 Cal.App.4th 798, 813, disapproved on another ground in Kwikset Corp. v. Superior
Court (2011) 51 Cal.4th 310, 337; see Chao Fu, Inc. v. Chen (2012) 206 Cal.App.4th
48, 57 [“ ‘real party in interest is one who has “an actual and substantial interest in the
subject matter of the action and who would be benefited or injured by the judgment in
the action” ’ ”].) “Where the complaint shows the plaintiff does not possess the
substantive right or standing to prosecute the action, ‘it is vulnerable to a general
demurrer on the ground that it fails to state a cause of action.’ ” (Schauer v. Mandarin
Gems of Cal., Inc. (2005) 125 Cal.App.4th 949, 955.)
The pleadings established that the Individual Plaintiffs were not the real parties in
interest. The fifth amended complaint alleged that they subleased the premises from
MDF in March 2004, helped to form Cal-Murphy in October 2004, and then “transferred
and assigned the Sublease to [ ] Cal-Murphy,” such that they no longer had any rights to
20
In explaining its ruling at the section 473 hearing, the court also stated that Cal-
Murphy had not satisfied the statutory requirement of attaching a copy of what Cal-
Murphy “wanted to have filed.” Cal-Murphy protests that Yanowitz filed a declaration in
support of the section 473 motion, that this declaration attached his prior declarations,
and that these prior declarations in turn attached Cal-Murphy’s two proposed sixth
amended complaints. However, in light of the entirety of the court’s remarks at the
hearing, the point was that Cal-Murphy had not attached a viable pleading as the
amendment it wanted to have filed, particularly since earlier in the hearing the court had
asked counsel to confirm that Cal-Murphy was relying on the proposed sixth amended
complaint that the court had already rejected. At any rate, whether or not the court was
correct about Cal-Murphy’s failure to comply with the statutory requisite of filing a
proposed pleading, the court did not abuse its discretion in denying the section 473
motion for the reasons stated in the text.
47
enforce the Lease. Moreover, the Individual Plaintiffs’ attorney, in a declaration
accompanying the opposition to the demurrer, admitted they “are not seeking any relief in
this case” and “have not contended that they have an interest in any relief sought,” but
were named in the lawsuit because they were in the chain of title and “may become
parties.” They further admit in their appellate briefing that they would benefit only
“indirectly from any recovery of monetary damages by Cal-Murphy or the abatement of
the nuisances and trespass to the extent that Cal-Murphy’s property rights or its
profitability would be enhanced.”
Individuals who claim an indirect benefit as members of a limited liability
corporation do not have standing as real parties in interest. (PacLink Communications
Internat., Inc. v. Superior Court (2001) 90 Cal.App.4th 958, 964-966 [member of LLC
lacks standing where “injury was essentially a diminution in the value of [plaintiffs’]
membership interest in the LLC occasioned by the loss of the company’s assets”].)
Appellants argue that it makes no difference whether the Individual Plaintiffs are
real parties in interest, because California has a broad permissive joinder statute which,
they urge, does not require all plaintiffs to have a claim or right to relief against a
defendant. (Code Civ. Proc., § 378, subd. (a).) That statute provides that “[a]ll persons
may join in one action as plaintiffs if . . . [¶] . . . [t]hey have a[n] . . . interest adverse to
the defendant in the . . . controversy which is the subject of the action.”
However, Code of Civil Procedure section 378 is a joinder statute, which
presupposes that the individuals have standing as real parties in interest. It does not
permit joinder of a party who has no legal or property interest. (Gartler v. First Nat. Bk.
of San Pedro (1928) 88 Cal.App. 411, 413 (Gartler).)
Appellants argue that Gartler is distinguishable because it involved an earlier
version of the statute, which permitted joinder by persons having “an interest in the
subject of the action, and in obtaining the relief demanded,” as compared to the present
statute that permits joinder by persons having an “interest adverse to the defendant in
the . . . controversy which is the subject of the action.” (Gartler, supra, at p. 413;
Code Civ. Proc., § 378.) But this distinction makes no difference in this case, since the
48
Individual Plaintiffs do not have a legal interest in the subject of the action, in obtaining
the relief demanded, or in the controversy.
Appellants present no legal authority for their argument that Code of Civil
Procedure section 378 permits a court to dispense with basic standing requirements.
They fail to establish error.21
III. DISPOSITION
The judgment is affirmed.
NEEDHAM, J.
We concur.
SIMONS, Acting P.J.
BRUINIERS, J.
21
In addition, Cal-Murphy’s requests for judicial notice, filed on October 31, 2013,
and April 1, 2014, are denied.
49
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522 F.3d 731 (2008)
UNITED STATES of America, Plaintiff-Appellee,
v.
Tyreese R. TAYLOR, Defendant-Appellant.
United States of America, Plaintiff-Appellee,
v.
Samuel R. Hogsett, Defendant-Appellant.
Nos. 06-4112, 07-1939.
United States Court of Appeals, Seventh Circuit.
Argued January 24, 2008.
Decided April 3, 2008.
*732 Robert A. Anderson (argued), Office of the United States Attorney, Madison, WI, for Plaintiff-Appellee.
David R. Karpe (argued), Madison, WI, for Defendant-Appellant.
Before POSNER, RIPPLE, and TINDER, Circuit Judges.
POSNER, Circuit Judge.
We have consolidated for decision two appeals presenting overlapping issues under Rule 404(b) of the Federal Rules of Evidence, which governs the admissibility of evidence of previous crimes or other "bad acts." Tyreese Taylor and Samuel Hogsett were convicted in separate trials of distributing crack (Hogsett was also convicted of a gun offense) and sentenced to 240 and 355 months in prison, respectively.
Rule 404(b) forbids the use of prior convictions or other evidence of bad acts to prove that the defendant has a propensity to commit crimes. But it allows such evidence *733 to be presented (in the discretion of the trial judge, balancing probative value against prejudice to the defendant under Fed.R.Evid. 403) to prove other, material facts, including criminal intent, identity, and absence of mistake. Taylor's lawyer told the judge before the trial began that he was going to request an instruction that would permit the jury to convict his client of the lesser offense of possession of crack for personal use rather than for sale. The judge ruled that the request opened the door to the government's presenting evidence of Taylor's prior conviction of possession of crack with intent to distribute it. But after the lawyers' opening statements to the jury, Taylor's lawyer withdrew the request for a lesser-included instruction, and the judge told the prosecutor that he could introduce evidence of prior bad acts, to rebut an inference that Taylor possessed drugs only for his personal use, only if the defendant opened the door to such evidence in some other way during the trial. The defendant did not do that.
The judge did allow the persons who had bought crack from Taylor in transactions that he was accused in this case of having made to testify that they knew from prior dealings with him that he was indeed a crack dealer. That evidence, like the prior conviction, related to his intent to distribute crack rather than to possess it just for personal use. He did not make an issue of intent, as we have just seen, but the buyers' evidence of prior dealings with him also related to identity; the evidence explained how they knew and thus could identify him. Although no one questioned these witnesses' ability to identify him as the person from whom they had bought crack in the transactions charged by the prosecution, we hesitate to pronounce the admission of their testimony of prior dealings with him a violation of Rule 404(b). The fact that a defendant pleads not guilty does not provide many clues to the specific attacks that he will mount against the government's case. Unless the government is allowed to present some evidence about previous transactions between the government's witnesses and the defendant, the transactions alleged in the government's current case could be challenged in the defendant's closing argument as unworthy of belief, especially since the buyer witnesses would be criminals who might be hoping for lenity by testifying for the government. It would be too late for the government to attempt to rehabilitate those witnesses. (We shall give another and clearer example of this sandbagging concern when we discuss Hogsett's appeal.)
The evidence that Taylor was known to be a seller of illegal drugs also explained why the government's informants had identified him as a potential seller for a controlled buy and how they knew who he was and what car he drove; the police officer who had observed the drug scene, being outside the house in which two of the three controlled buys took place, did not see Taylor hand over the drugs. The buyers' previous knowledge about him related to the accuracy (hence absence of mistake) of their testimony concerning the controlled buys that provided crucial evidence for the government's case.
But clearly the judge should not have allowed the officer who arrested Taylor to testify that he had recognized him as a result of having known him "throughout [the officer's] career as a police officer and as a drug and gang officer" (emphasis added). There was no doubt of the identity of the arrested person.
The government offers two other reasons for the admission of this damaging testimony, which implied that Taylor had a long history of drug and gang activity. First, the officer had arrested him after observing illegal tinting on his car windows and an illegal tinted cover on his rear license plate. But the officer testified that *734 he had not made the decision to arrest for so trivial a traffic offense until he recognized that it was Taylor's car. He also testified that he knew there was an outstanding warrant for Taylor's arrest (on what charge the jury was not told).
That evidence was at once irrelevant and damaging, as was the officer's testimony about his prior professional knowledge of Taylor. It is not as if the government had to try to justify the arrest on the basis not of the traffic offenses but of suspicion that Taylor was a drug dealer. Not only was the legitimacy of the arrest for the traffic offenses not questioned; it was an issue for the judge rather than for the jury to decide. United States v. McKinney, 919 F.2d 405, 414 (7th Cir.1990); see Jones v. United States, 362 U.S. 257, 264, 80 S.Ct. 725, 4 L.Ed.2d 697 (1960); United States v. Nunez-Rios, 622 F.2d 1093, 1098-99 (2d Cir.1980); Fed.R.Crim.P. 12(b)(3)(C).
The government appeals (in Hogsett's case as well) to the principle that bad-act evidence "inextricably intertwined" with admissible evidence may be admitted without regard to the specific exceptions in Rule 404(b), and argues that all the bad-act evidence in Taylor's case was of that character. Although many cases recite the "inextricably intertwined" formula, see, e.g., United States v. Luster, 480 F.3d 551, 556-57 (7th Cir.2007), and cases cited in United States v. Bowie, 232 F.3d 923, 927-28 (D.C.Cir.2000), it is unhelpfully vague. Courts do not agree on whether it refers to evidence "intrinsic" to the charged crime itself, in the sense of being evidence of the crime, or whether though evidence of another crime it may be introduced in order to "complete the story" of the charged crime. As explained in the Bowie opinion, neither formulation is satisfactory: to courts adopting the former, "inextricably intertwined evidence is intrinsic, and evidence is intrinsic if it is inextricably intertwined," while "the `complete the story' definition of `inextricably intertwined' threatens to override Rule 404(b). A defendant's bad act may be only tangentially related to the charged crime, but it nevertheless could `complete the story' or `incidentally involve' the charged offense or `explain the circumstances.' If the prosecution's evidence did not `explain' or `incidentally involve' the charged crime, it is difficult to see how it could pass the minimal requirement for admissibility that evidence be relevant. See Fed.R.Evid. 401 and 402." 232 F.3d at 928.
What is true, but irrelevant to this case, is that if a defendant commits two criminal acts at the same time and is charged with only one, the evidence of the charged crime may unavoidably reveal the uncharged one, as in Ignacio v. People of Territory of Guam, 413 F.2d 513, 519-20 (9th Cir.1969), and United States v. Persico, 425 F.2d 1375, 1384 (2d Cir.1970). In such a case for example where the defendant assaults a person in the course of buying illegal drugs from him but is prosecuted only for possessing drugs with intent to distribute them, or where he commits an armed robbery but is charged only with being a felon in possession the evidence of the "other" crime can't be disentangled from the evidence of the charged crime. Or if a defendant makes an issue of his criminal intent, as Taylor initially did by his later-abandoned request for an instruction on simple possession, his previous activities may become relevant to inferring his state of mind with regard to the current charges. If in the past he possessed small quantities of crack with intent to sell rather than merely to consume, this would be some evidence that his current modest inventory also was not just for his own consumption. Moreover, as we said, the fact that a defendant's buyers had dealt with him previously could explain how they were able to identify him, why they picked him for the controlled buy, and why he was willing to deal with them.
*735 But intent and absence of mistake are express exceptions to the Rule 404(b) bar; there is no need to spread the fog of "inextricably intertwined" over them. Almost all evidence admissible under the "inextricably interwoven" doctrine is admissible under one of the specific exceptions in Rule 404(b), or under the judge-made "no confusion" exception discussed later in this opinion. The objection to "inextricably interwoven" is that its vagueness invites prosecutors to expand the exceptions to the rule beyond the proper boundaries of the exceptions.
The arresting officer's testimony about the real reason for his arresting Taylor does not connect to any of the exceptions. It was just a way of telling the jury that the officer knew Taylor to have been a drug offender and gang member for a long time and that at the time of the arrest Taylor was a wanted criminal. But the violation of Rule 404(b) was harmless. The evidence of Taylor's guilt was overwhelming. Two confidential informants testified that they had bought crack from Taylor in controlled buys set up by the police. A third witness saw one of those drug deals taking place. The informants' accounts were corroborated by a police officer, while another officer testified that Taylor had had a bag of crack in his possession when he was arrested. Taylor called no witnesses of his own and offered no evidence of innocence. No adverse inference can be drawn from his failure to testify, but a defendant's failure to present any evidence at all can help support a finding of harmless error. E.g., United States v. Martin, 391 F.3d 949, 955-56 (8th Cir.2004); Bond v. Oklahoma, 546 F.2d 1369, 1376-77 (10th Cir.1976).
Hogsett, our second appellant, was also arrested in his car for a minor traffic offense. His passenger testified that he'd told her they were on their way to "hit a lick" when they were stopped. When asked at trial what that meant, she said it meant that Hogsett was going to sell drugs. That part of her testimony is admittedly relevant to his intent with regard to the crack cocaine found in the car. But she added that the reason she knew what "hit a lick" means is that she had been with the defendant on previous "licks." Again the government invokes the "inextricably intertwined" doctrine, and this time decorates it with reference to the importance of filling "conceptual void[s]" and tells us that "the proffered evidence [how she knew what `hit a lick' means] form[ed] an integral part of the witness's account of the circumstances surrounding the offenses of which the defendant was indicted." These windy formulas do no work. The justification for asking the witness how she knew what "hit a lick" means is that otherwise the defense lawyer in his closing argument could have challenged the accuracy of her definition of the term could have said to the jury how could she know what the term meant when no foundation for her knowledge had been laid? It would have been too late for the government to recall her to the stand to answer the defense lawyer's rhetorical query. So the prosecutor's asking her on direct examination how she knew was proper to show absence of mistake.
The list of permissible uses of bad-acts evidence in Rule 404(b) is introduced by "such as," and so is not exhaustive. United States v. Cruz-Garcia, 344 F.3d 951, 955 (9th Cir.2003); Udemba v. Nicoli, 237 F.3d 8, 15 (1st Cir.2001); United States v. Miller, 895 F.2d 1431, 1435 (D.C.Cir.1990). The aim of the rule is simply to keep from the jury evidence that the defendant is prone to commit crimes or is otherwise a bad person, Huddleston v. United States, 485 U.S. 681, 687-89, 108 S.Ct. 1496, 99 L.Ed.2d 771 (1988), implying that the jury needn't worry overmuch about the strength of the government's evidence. *736 No other use of prior crimes or other bad acts is forbidden by the rule, and the draftsmen did not try to list every possible other use.
This point is pertinent because a legitimate item to add to the list, which does not have the vice of indefiniteness, is the need to avoid confusing the jury. In both Taylor's and Hogsett's cases, had no reason been given for the arrests the jurors might be scratching their heads and might even think that the police had been violating the defendants' rights, by arresting them without cause, and maybe should be punished by an acquittal. But in neither case was the legality of the arrest questioned. And if it had been, the judge should simply have instructed the jury that the arrest had been proper for reasons that it should not concern itself with; for the legality of the arrest (and hence of the seizure of the drugs found in Hogsett's car when he was arrested) was, as we have noted, an issue for the judge rather than for the jury.
Hogsett raises an additional issue that is unrelated to Rule 404(b). The defense learned before trial that the passenger in Hogsett's car a key witness for the prosecution to whom we referred previously had had outstanding state warrants that had been quashed before the trial. Hogsett's lawyer wanted to cross-examine her about them to see whether she might have thought that a federal criminal investigator with whom she had dealt had gotten them quashed, perhaps in implied exchange for her testifying favorably to the prosecution. The judge refused to permit this line of cross-examination after conducting a hearing at which the witness testified that she did not know why the warrants had been quashed; the investigator testified that he had neither promised to help her get them quashed nor done anything to get them quashed, nor so much as hinted to her that he might help her out with them; and the prosecutor assured the judge on the record that the federal government had had no involvement with the warrants.
The judge did not abuse his discretion in barring this line of questioning. You are not permitted to cross-examine a witness about a particular topic without a good-faith belief that the answers will be helpful to your case, as distinct from hoping that the question alone will insinuate a helpful answer ("are you not testifying against the defendant because you believe the prosecutor helped to quash the state warrants against you?"). United States v. Adames, 56 F.3d 737, 745 (7th Cir.1995); United States v. Guay, 108 F.3d 545, 552-53 (4th Cir.1997). If there is an objection at trial to a question asked on cross-examination, on the ground that there is no good-faith basis for it, and at a sidebar the judge so finds, he must sustain the objection. That in effect is what the judge did here, when the hearing revealed the shot-in-the-dark nature of the proposed cross-examination.
Taylor also raises an issue unrelated to Rule 404(b). He was given the statutory mandatory minimum sentence for possession with intent to distribute more than 50 grams of crack, 21 U.S.C. §§ 841(a)(1), (b)(1)(A)(iii), and argues that the statutory minimum works a denial of equal protection. But he has given us no reason to reexamine our decisions rejecting the argument. United States v. Spencer, 160 F.3d 413, 413-14 (7th Cir.1998); United States v. Westbrook, 125 F.3d 996, 1010 (7th Cir.1997); United States v. Lawrence, 951 F.2d 751, 753-56 (7th Cir.1991); see also United States v. Garcia-Carrasquillo, 483 F.3d 124, 134 (1st Cir.2007); United States v. Burgos, 94 F.3d 849, 876-77 (4th Cir.1996) (en banc).
AFFIRMED.
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2008 UT App 219
State of Utah, Plaintiff and Appellee,
v.
Juan Carlos Diaz-Arevalo, Defendant and Appellant.
Case No. 20060802-CA.
Court of Appeals of Utah.
Filed June 5, 2008.
This opinion is subject to revision before publication in the Pacific Reporter.
Joan C. Watt and Nisa J. Sisneros, Salt Lake City, for Appellant.
Mark L. Shurtleff and Jeffrey S. Gray, Salt Lake City, for Appellee.
Before Judges Thorne, Davis, and Orme.
OPINION
THORNE, Associate Presiding Judge:
¶1 Juan Carlos Diaz-Arevalo appeals from the district court's denial of his motion to withdraw his guilty plea to a charge of murder, a first degree felony, see Utah Code Ann. § 76-5-203 (2003). We affirm.
BACKGROUND
¶2 On May 16, 2005, Diaz-Arevalo attempted to recover a vehicle from his former girlfriend, Lindsey Rae Fawson. Diaz-Arevalo was armed with a sawed-off shotgun. When Fawson resisted, a struggle ensued, and Fawson was killed by a single shotgun blast to the head. Diaz-Arevalo was subsequently charged with multiple crimes, including a charge of murder for Fawson's death.
¶3 The State's Amended Information stated three alternative theories of murder under Utah Code section 76-5-203: an intentional or knowing killing, see id. § 76-5-203(2)(a); a killing committed with depraved indifference to human life, see id. § 76-5-203(2)(c); and a killing committed with the intent to cause serious bodily injury, see id. § 76-5-203(2)(b). Diaz-Arevalo eventually agreed to plead guilty to murder under the State's depraved indifference theory, which was described in the Amended Information as follows: "Diaz-Arevalo, a party to the offense, acting under circumstances evidencing depraved indifference to human life, engaged in conduct which created a grave risk of death to another, and thereby caused the death of Lindsey Rae Fawson." Diaz-Arevalo's plea affidavit defined the offense similarly, as did the district court at Diaz-Arevalo's May 15, 2006 change-of-plea hearing. Although these definitions adequately paraphrase the statute that was in effect at the time,[1] each definition omits an element that has been required by the Utah Supreme Court that a defendant knowingly created a grave risk of death. See State v. Standiford, 769 P.2d 254, 264 (Utah 1988).[2]
¶4 At Diaz-Arevalo's change-of-plea hearing, the State proffered the following factual basis for the murder plea: "[Diaz-Arevalo] used a sawed-off shotgun and aimed it at the victim, Lindsey Fawson, pulled the trigger, and it caused her death." In support of other counts to which Diaz-Arevalo was pleading, the State proffered that Diaz-Arevalo "admitted to purchasing that shotgun and using it in the commission of Lindsey Fawson's death" and that Diaz-Arevalo "shot at" the victim. Diaz-Arevalo agreed with the State's proffer and the district court accepted his guilty plea.
¶5 After the change-of-plea hearing but before sentencing, Diaz-Arevalo wrote a letter to the district court requesting that he be sentenced to concurrent sentences for his crimes. In the letter, Diaz-Arevalo asserted that the shooting of Fawson was an accident and that he had been on methamphetamine at the time of the shooting. On August 8, 2006, one day prior to sentencing, Diaz-Arevalo filed a motion to withdraw his guilty plea, asserting generally that he had not been adequately represented by his counsel and that his plea had not been knowingly made. The motion to withdraw referenced Diaz-Arevalo's earlier letter to the court.
¶6 At the August 9 sentencing hearing, the district court addressed Diaz-Arevalo's motion. Diaz-Arevalo's counsel had nothing to offer the court respecting Diaz-Arevalo's motion, and the court questioned Diaz-Arevalo directly about the exact grounds for his motion. Diaz-Arevalo identified two such grounds: first, that he had been given bad advice by his counsel about the possible federal law consequences of his guilty plea, and second, that Fawson's death was an accident and that he wanted to "clear that up." Diaz-Arevalo offered no further explanation of why Fawson's death should be deemed accidental, nor did he raise any factual assertions inconsistent with the State's proffer at the change-of-plea hearing. Neither Diaz-Arevalo nor his counsel raised the issue of the knowledge element missing from the definition of the murder charge, see id. After hearing from both Diaz-Arevalo and the State, the district court denied the motion. Diaz-Arevalo appeals the district court's denial order.
ISSUE AND STANDARD OF REVIEW
¶7 Diaz-Arevalo argues that the district court committed plain error when it denied his motion to withdraw his guilty plea to one count of murder. The basis of the alleged error is that the district court accepted Diaz-Arevalo's plea to depraved indifference murder without instructing him as to all of the elements of the charge and ensuring that he understood them. Specifically, the elements of the murder charge did not reflect that, under State v. Standiford, 769 P.2d 254 (Utah 1988), Diaz-Arevalo must have acted knowingly in creating a grave risk of death to another. See id. at 264.
¶8 In appropriate cases, we review issues not preserved in the district court for plain error.[3] See State v. Person, 2006 UT App 288, ¶ 10, 140 P.3d 584. Under the plain error doctrine, we will reverse the trial court's ruling only if (i) an error exists; (ii) the error should have been obvious to the trial court; and (iii) the error is harmful, i.e., absent the error, there is a reasonable likelihood of a more favorable outcome for the defendant. See State v. Cox, 2007 UT App 317, ¶ 10, 169 P.3d 806.
ANALYSIS
I. Diaz-Arevalo's Claims of Error Not Preserved
¶9 Diaz-Arevalo argues that the issue of the omitted knowledge element, see Standiford, 769 P.2d at 264, was properly preserved for appeal. Diaz-Arevalo claims preservation based on his argument to the district court that Fawson's death was accidental, and the district court's erroneous statement that Diaz-Arevalo had been informed of all of the elements of the murder charge. We disagree with Diaz-Arevalo's contention that these facts establish proper preservation of the Standiford issue.
¶10 In order to preserve an issue for appeal, a defendant must raise the issue before the district court in such a way that the court is placed on notice of potential error and then has the opportunity to correct or avoid the error. See State v. Dean, 2004 UT 63, ¶ 13, 95 P.3d 276 ("A proper objection `puts the judge on notice of the asserted error and allows the opportunity for correction at that time in the course of the proceeding.'" (quoting Broberg v. Hess, 782 P.2d 198, 201 (Utah Ct. App. 1989))). The issue must be "'sufficiently raised to a "level of consciousness" before the trial court and must be supported by evidence or relevant legal authority.'" Id. (quoting State v. Schultz, 2002 UT App 366, ¶ 19, 58 P.3d 879). "[P]erfunctorily mentioning an issue, without more, does not preserve it for appeal." State v. Worwood, 2007 UT 47, ¶ 16, 164 P.3d 397.
¶11 Diaz-Arevalo did not refer the district court to Standiford or its progeny, nor did he assert any flaw in the elements of the murder charge. Despite this, Diaz-Arevalo claims that the "record as a whole" demonstrates that he preserved the Standiford issue. Diaz-Arevalo bases this claim on his various assertions to the district court that Fawson's death was accidental,[4] and on comments made by the district court in rejecting his motion. In explaining its denial of Diaz-Arevalo's motion, the district court stated:
[Diaz-Arevalo] says first of all the killing of Lindsey [Rae Fawson] was an accident and he wants the opportunity to "clear that up," I believe were his words. However, during the plea colloquy, that's when I talked to you before the entry of your plea, Mr. Diaz-Arevalo, the charge was explained to you. The elements of the offense were explained. You were asked if you understood them. And then you were asked if you admitted that they were true and that you were guilty of the offense and you said that you did.
For some reason now apparently you've changed your mind and feel as though what you admitted on the date you entered you[r] guilty plea was incorrect. At least on that occasion you were fully informed of what the charge was and you said that you understood it and you were willing to admit that you were guilty of that offense.
Based on this statement, Diaz-Arevalo asserts that "the issue of whether the defendant was fully informed of the elements for depraved indifference [murder] was raised such that the court was able to address it on its merits."
¶12 We cannot agree with Diaz-Arevalo's characterization. Diaz-Arevalo gave the district court no reason to look beyond the boundaries of the Amended Information or the statute itself to ascertain the elements of depraved indifference murder. Diaz-Arevalo's argument to the district court was not that the murder charge had omitted an element, but rather that the facts surrounding Fawson's death did not support the charge as it was defined in the Amended Information and at the change-of-plea hearing. This factual dispute failed to apprise the district court of any problem pertaining to the elements of the murder charge, and Diaz-Arevalo therefore failed to preserve the Standiford issue for appeal. See Dean, 2004 UT 63, ¶ 13.
II. Diaz-Arevalo Has Failed to Show Plain Error
¶13 In the alternative, Diaz-Arevalo argues that the district court's denial of his timely motion to withdraw his guilty plea constitutes plain error in light of the Standiford issue. See generally State v. Person, 2006 UT App 288, ¶ 10, 140 P.3d 584 (discussing the requirement of raising the plain error doctrine to obtain review of unpreserved issues). To prevail under the plain error doctrine, Diaz-Arevalo must demonstrate that there was error below, that the error should have been obvious to the district court, and that the error was prejudicial. See State v. Cox, 2007 UT App 317, ¶ 10, 169 P.3d 806. "'If any one of these requirements is not met, plain error is not established.'" State v. Dean, 2004 UT 63, ¶ 15, 95 P.3d 276 (quoting State v. Dunn, 850 P.2d 1201, 1209 (Utah 1993)).
¶14 Under the circumstances of this case, we have little trouble concluding that the district court's failure to ensure DiazArevalo's understanding of each of the elements of depraved indifference murder constituted error and that the error should have been obvious to the court. Although the district court's explanation of the elements of murder accurately paraphrased the statute in effect at the time, the court did not instruct Diaz-Arevalo that he must have knowingly created a grave risk of death in order to commit the crime charged. This element was required by the Utah Supreme Court in 1988 and had therefore been established law for over a decade prior to Diaz-Arevalo's plea. See State v. Standiford, 769 P.2d 254, 264 (Utah 1988); see also State v. Powell, 872 P.2d 1027, 1030 (Utah 1994); State v. Vigil, 842 P.2d 843, 844 (Utah 1992), overruled in part on other grounds by State v. Casey, 2003 UT 55, 82 P.3d 1106; State v. Blubaugh, 904 P.2d 688, 694 (Utah Ct. App. 1995). Under these circumstances, we can only conclude that the failure to ensure Diaz-Arevalo's understanding and acceptance of the omitted element constitutes both error and obvious error on the part of the district court.
¶15 Despite this obvious error, Diaz-Arevalo cannot prevail under the plain error doctrine because he fails to establish that the alleged error was harmful. As explained in State v. Dean, 2004 UT 63, 95 P.3d 276, a defendant seeking to establish harmful error in the context of a failed attempt to withdraw a guilty plea must "assert[] that `but for' the alleged error, he or she would not have pled guilty." Id. ¶ 22. Here, Diaz-Arevalo has not expressly asserted, below or on appeal, that he would not have pleaded guilty to murder if that charge had been properly explained to him.
¶16 Nor can we infer such an assertion from his proclaimed belief that Fawson's death was accidental. Diaz-Arevalo's characterization of Fawson's death as accidental is not categorically inconsistent with his having known that pointing a gun at another human being presents a grave risk of death. For example, even though he aimed the gun at Fawson, Diaz-Arevalo may have believed that it would not discharge because he had no intention of pulling the trigger. If, as Diaz-Arevalo now asserts, he pulled the trigger accidentally due to Fawson's struggling, he may subjectively believe that her death was an accident; nevertheless, he may still knowingly have created the gravely dangerous circumstances that led to that death. Thus, we cannot assume that Diaz-Arevalo would not have entered his plea to a properly defined murder charge merely because he asserts that Fawson's death was accidental.
¶17 Because Diaz-Arevalo has not asserted that he would not have pleaded guilty to a properly defined murder charge, he has not established harmful error by the district court. Having failed to establish harmful error, he has not established plain error, and in the absence of plain error we will not disturb the district court's ruling below.
CONCLUSION
¶18 Diaz-Arevalo's motion to withdraw his guilty plea failed to raise or preserve the issue of the inadequacy of the district court's explanation of the elements of depraved indifference murder under State v. Standiford, 769 P.2d 254 (Utah 1988). We therefore address his arguments under the plain error doctrine. Diaz-Arevalo has demonstrated that an error did occur at the time of his plea in that he was not informed of the "knowing" element of depraved indifference murder. See id. at 264. Further, in light of the well-established case law, we must conclude that the error should have been obvious to the district court. However, Diaz-Arevalo has not established prejudice because he has not asserted that he would not have entered his guilty plea absent the district court's error. Accordingly, relief is not warranted under the plain error doctrine, and we affirm the order of the district court.
¶19 WE CONCUR: James Z. Davis, Judge, Gregory K. Orme, Judge.
NOTES
[1] The version of the murder statute in effect at the time of Fawson's death provided that depraved indifference murder was committed when, "acting under circumstances evidencing a depraved indifference to human life, [an] actor engages in conduct which creates a grave risk of death to another and thereby causes the death of another." Utah Code Ann. § 76-5-203(2)(c) (2003).
[2] Effective April 30, 2007, the legislature amended Utah Code section 76-5-203 to include the knowledge element previously imposed by State v. Standiford, 769 P.2d 254 (Utah 1988). See Utah Code Ann. § 76-5-203(2)(c) (Supp. 2007) (stating that a person commits murder if, "acting under circumstances evidencing a depraved indifference to human life, the actor knowingly engages in conduct which creates a grave risk of death to another and thereby causes the death of another" (emphasis added)).
[3] Diaz-Arevalo also argues that his Standiford issue was properly preserved below, but we reject that argument as explained in our analysis.
[4] For example, in a letter to the district court, Diaz-Arevalo explained:
I made the fatal mistake of pulling out the gun, but not to harm her in any way. . . . What happened next was an [accident]. I had the gun pointed to the ground but as she started to kick at me from inside our car somehow her feet picked up the gun and the impact of her kicks caused the gun to go off.
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[Until this opinion appears in the Ohio Official Reports advance sheets, it may be cited as
Green v. Shoop, Slip Opinion No. 2020-Ohio-873.]
NOTICE
This slip opinion is subject to formal revision before it is published in an
advance sheet of the Ohio Official Reports. Readers are requested to
promptly notify the Reporter of Decisions, Supreme Court of Ohio, 65
South Front Street, Columbus, Ohio 43215, of any typographical or other
formal errors in the opinion, in order that corrections may be made before
the opinion is published.
SLIP OPINION NO. 2020-OHIO-873
GREEN, APPELLANT, v. SHOOP, WARDEN, APPELLEE.
[Until this opinion appears in the Ohio Official Reports advance sheets, it
may be cited as Green v. Shoop, Slip Opinion No. 2020-Ohio-873.]
Habeas corpus—Res judicata—Alleged failure of state to file criminal complaint
not cognizable in habeas corpus because defendant had been indicted—Res
judicata bars successive habeas corpus petitions—Court of appeals’
judgment dismissing petition affirmed.
(No. 2019-1052—Submitted December 10, 2019—Decided March 12, 2020.)
APPEAL from the Court of Appeals for Ross County,
No. 19CA3675.
___________________
Per Curiam.
{¶ 1} Appellant, Danny M. Green, appeals the judgment of the Fourth
District Court of Appeals dismissing his petition for a writ of habeas corpus against
appellee, Tim Shoop, warden of the Chillicothe Correctional Institution. Green has
also filed a motion to strike the warden’s merit brief for lack of a valid certificate
SUPREME COURT OF OHIO
of service. We affirm the judgment of the court of appeals and deny the motion to
strike.
Green’s Petition
{¶ 2} In April 2013, Green pleaded guilty to two amended charges of rape
and the trial court sentenced him to an aggregate nine-year prison term. Green did
not directly appeal his convictions or sentence.
{¶ 3} In December 2015, Green filed a petition for a writ of habeas corpus
in the Ross County Court of Common Pleas, alleging deprivations of his
constitutional rights. The trial court dismissed Green’s petition because he could
have raised his claims on direct appeal.
{¶ 4} On March 14, 2019, Green filed against the warden a petition for a
writ of habeas corpus in the Fourth District, arguing that he was entitled to
immediate release because no criminal complaint had been filed, the case had not
been properly before the grand jury, and all subsequent proceedings were a nullity.
{¶ 5} On June 28, 2019, the court of appeals granted the warden’s motion
to dismiss on two grounds: Green’s claims were not cognizable in habeas corpus
and res judicata bars his successive habeas corpus petition. Green appealed to this
court.
{¶ 6} The court of appeals’ analysis is correct in both respects. Res judicata
bars Green’s 2019 habeas corpus petition because he filed an earlier petition for a
writ of habeas corpus in which he could have raised any cognizable claim that he
had, Bevins v. Richards, 144 Ohio St.3d 54, 2015-Ohio-2832, 40 N.E.3d 1108, ¶ 4.
In addition, the claims raised in Green’s 2019 petition were not cognizable in
habeas corpus. “Any defect caused by the alleged failure to file criminal complaints
or the claimed impropriety of the municipal court’s assumption of jurisdiction over
* * * rape charges is not cognizable in habeas corpus.” Taylor v. Mitchell, 88 Ohio
St.3d 453, 454, 727 N.E.2d 905 (2000). Green was convicted and sentenced upon
2
January Term, 2020
indictments, and the trial court had jurisdiction over his case. Boylen v. Bradshaw,
108 Ohio St.3d 181, 2006-Ohio-549, 842 N.E.2d 49, ¶ 5.
Motion to Strike
{¶ 7} S.Ct.Prac.R. 3.11(D)(1)(a) requires that “all documents presented for
filing with the Clerk shall contain a certificate of service. The certificate of service
shall state the date and manner of service and identify the names of the persons
served and shall be signed by the party or the amicus curiae who files the
document.”
{¶ 8} A certificate of service on the warden’s merit brief states that the
warden sent a copy of the brief to Green on October 8, 2019. Green has attached
to his motion to strike a cover letter from the warden dated October 9, 2019,
showing that October 9 was the date on which the warden sent his brief to Green.
{¶ 9} Green claims that the discrepancy in the dates shows a “willful act”
to deprive him of more time to prepare and deliver his reply brief. But Green
presents no evidence to support this claim. Green did not request a time extension
and he filed his reply brief before the due date. Green also acknowledges that he
has not been prejudiced because, in Green’s words, the warden’s brief “contained
nothing that even addressed Appellant’s claim of erroneous case law, let alone
disproved it.” Accordingly, Green’s motion to strike is denied.
Judgment affirmed.
O’CONNOR, C.J., and KENNEDY, FRENCH, FISCHER, DEWINE, DONNELLY,
and STEWART, JJ., concur.
_________________
Danny M. Green, pro se.
Dave Yost, Attorney General, and Maura O’Neill Jaite, Assistant Attorney
General, for appellee.
_________________
3
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402 S.W.2d 697 (1966)
Lynn M. RAQUE, Appellant,
v.
CITY OF LOUISVILLE, Kentucky and Robert Matthews, Attorney General, Commonwealth of Kentucky, Appellees.
Court of Appeals of Kentucky.
May 6, 1966.
James B. Young, Louisville, for appellant.
Eugene H. Alvey, Franklin P. Hays, Louisville, Robert Matthews, Atty. Gen., Henri L. Mangeot, Asst. Atty. Gen., for appellees.
PALMORE, Judge.
By an ordinance duly enacted and approved on August 24, 1965, the City of Louisville directed an election to be held on the question of whether it should incur an indebtedness of $29,820,000 for a variety of specified municipal projects. KRS 66.050. The proposal received the assent of more than two-thirds of the voters, as required by Const. § 157, at the November 1965 election, and on December 30, 1965, the city enacted a further ordinance authorizing the issuance of bonds payable over a 30-year schedule and providing for the levy of "a tax sufficient to pay the interest on said bonds as the same falls due and also to constitute a sinking fund for the payment of the principal of said bonds as the same mature, which tax shall be levied and collected at the same time and in the same manner as other taxes of said City and shall be in addition to all other taxes authorized to be levied by said City."
This suit was brought by the city against one of its resident citizens and ad valorem taxpayers, as a class representative, for a declaratory judgment determining the validity *698 of and construing the ordinances. KRS 66.210; KRS 418.040. The Attorney General of the Commonwealth intervened, KRS 418.075, because the complaint raised certain questions with regard to the validity and applicability of the 1965 Special Session tax legislation, 1965 1st ex s, H 1.
On the basis of the pleadings, depositions and stipulated facts the trial court adjudged that the ordinances were valid, that the bonds hereafter issued in conformity with them will be enforceable obligations of the city so long as the 10% limitation of Const. § 158 is not exceeded,[1] and that all property subject to ad valorem taxation by the city may be taxed at whatever rate should become necessary, after compliance with KRS 91.150 and 91.200,[2] in order to pay the interest and provide a sinking fund for retirement of the bonds on schedule.
The first argument on appeal is that the ordinances violate Const. § 178 in specifying more than one "purpose" for which the money to be borrowed shall be used. It is frankly conceded that to reach that end would require us to overrule Burke v. City of Louisville, Ky., 275 S.W.2d 899 (1955), and the precedents on which it rests. We are satisfied, however, that the law as it now stands in that respect is sound and should not be disturbed.
The only other issue seriously pursued at this stage concerns House Bill 1,[3] which, broadly speaking and with exceptions not pertinent to this case, provides that local ad valorem tax rates for 1966 and thereafter may not exceed what is necessary to produce the same amount of tax revenue as in 1965. This maximum is called the "compensating tax rate." KRS 132.010(6). It is expressly applied to cities by Section 14 of the Act, now KRS 132.027.
Appellant contends that the compensating tax rate limits any levy of taxes, including those which may become necessary in order to pay the interest and provide a sinking fund to retire the principal of these bonds on schedule. If so, the Act runs afoul of Const. § 159, which prescribes that whenever a local taxing authority is authorized to contract an indebtedness it must at the same time provide for the collection of an annual tax sufficient to pay the interest and create a sinking fund for the retirement of the principal within not more than 40 years.[4]
Since City of Winchester v. Nelson, 175 Ky. 63, 193 S.W. 1040 (1917), it has been established and "is still recognized that an indebtedness authorized by a vote of the people permits a levy in excess of the maximum specified in Section 157" of the Constitution. Griffin v. Clay County, 304 Ky. 592, 201 S.W.2d 733, 735 (1947). To hold otherwise, reasoned the City of Winchester opinion, would have the probable effect of rendering nugatory the provision of Const. § 157 which authorizes a voted indebtedness in excess of current revenues, a result the court felt was not intended by the framers of the Constitution. For the same reason, and without reaching the question of whether any legislation effecting such a result would be constitutional, we have no difficulty in concluding that the General Assembly did not intend to limit the rate at which taxes must necessarily be levied to pay an indebtedness incurred either theretofore or thereafter by authority of a vote of the people under Const. *699 § 157. Considering the background of the Act, it seems quite certain that it was designed to safeguard against unintended tax burdens, and not against those which are specifically intended and specially authorized.
The judgment is affirmed.
NOTES
[1] It was established by the evidence that an increase of $29,820,000 would not at present cause the net indebtedness to exceed the limit.
[2] KRS 91.200(6) provides that ad valorem taxes for the benefit of the sinking fund shall not be levied unless the income of the sinking fund is otherwise insufficient. The chancellor found as a fact that the income of Louisville's sinking fund probably will be sufficient to pay the principal and interest on the $29,820,000 bond issue without additional ad valorem taxation.
[3] Enacted in September of 1965 and effective December 16, 1965.
[4] The same requirement is carried into the statutes by KRS 66.050(2).
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August 12, 2014
JUDGMENT
The Fourteenth Court of Appeals
GUY B. SULLAWAY, JR., Appellant
NO. 14-14-00282-CV V.
CAROLYN JANICE SMITH, Appellee
________________________________
Today the Court heard appellant's motion to dismiss the appeal from the
judgment signed by the court below on April 1, 2014. Having considered the
motion and found it meritorious, we order the appeal DISMISSED.
We further order that all costs incurred by reason of this appeal be paid by
appellant, Guy B. Sullaway, Jr.
We further order that mandate be issued immediately.
We further order this decision certified below for observance.
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United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 07-1146
___________
United States of America, *
*
Appellee, * Appeal from the United States
* District Court for the
v. * Western District of Arkansas.
*
* [UNPUBLISHED]
Rigoberto Salas-Castro, *
*
Appellant. *
___________
Submitted: November 13, 2007
Filed: November 15, 2007
___________
Before BYE, RILEY, and MELLOY, Circuit Judges.
___________
PER CURIAM.
Rigoberto Salas-Castro appeals the sentence imposed by the district court1 after
he pleaded guilty to an immigration charge, in violation of 8 U.S.C. § 1326(a) and
(b)(2), 6 U.S.C. § 202(3) and (4), and 6 U.S.C. § 557. Salas-Castro’s counsel has filed
a brief under Anders v. California, 386 U.S. 738 (1967), and moves to withdraw. For
reversal, he argues that Salas-Castro’s sentence, which was imposed at the bottom of
the uncontested Guidelines range, is unreasonable.
1
The Honorable Jimm Larry Hendren, Chief Judge, United States District Court
for the Western District of Arkansas.
We review Salas-Castro’s sentence for reasonableness, and given that it falls
within the advisory Guidelines range, it is presumptively reasonable. See Rita v.
United States, 127 S. Ct. 2456, 2462 (2007) (discussing presumption). We see no
basis in the record for concluding that Salas-Castro’s sentence is unreasonable, see
United States v. Haack, 403 F.3d 997, 1003-04 (8th Cir. 2005) (factors); and further,
after reviewing the record independently under Penson v. Ohio, 488 U.S. 75 (1988),
we have found no nonfrivolous issues for appeal. Accordingly, we affirm, and we
grant counsel leave to withdraw.
______________________________
-2-
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[Cite as State v. Quinones, 2016-Ohio-3287.]
STATE OF OHIO ) IN THE COURT OF APPEALS
)ss: NINTH JUDICIAL DISTRICT
COUNTY OF LORAIN )
STATE OF OHIO C.A. No. 15CA010722
Appellee
v. APPEAL FROM JUDGMENT
ENTERED IN THE
NANCY QUINONES COURT OF COMMON PLEAS
COUNTY OF LORAIN, OHIO
Appellant CASE No. 14CR088841
DECISION AND JOURNAL ENTRY
Dated: June 6, 2016
MOORE, Presiding Judge.
{¶1} Defendant, Nancy Quinones, appeals from the judgment of the Lorain County
Court of Common Pleas. We affirm.
I.
{¶2} In 2014, the Lorain County Grand Jury indicted Ms. Quinones on one count of
trafficking in drugs in violation of R.C. 2925.03(A)(2) and one count of possession of drugs in
violation of R.C. 2925.11(A), with a major drug offender specification attendant to both counts
and a forfeiture specification attendant to the trafficking count. These charges stemmed from a
controlled mail delivery to Ms. Quinones of a significant amount of cocaine.
{¶3} Ms. Quinones entered not guilty pleas to the charges. Just prior to the
commencement of trial, Ms. Quinones indicated that she wished to waive her right to a jury trial.
She signed a jury waiver, and, after a lunch recess, the case proceeded to a bench trial. The trial
court found Ms. Quinones guilty of all of the charges and specifications. In a journal entry dated
2
December 16, 2014, the trial court merged the possession count with the trafficking count, and it
imposed an aggregate sentence of eleven years of incarceration on the trafficking conviction with
the attendant major drug offender specification.
{¶4} Ms. Quinones timely appealed from the sentencing entry, and she now raises two
assignments of error for our review.
II.
ASSIGNMENT OF ERROR I
THE TRIAL COURT COMMITTED REVERSIBLE AND PLAIN ERROR AND
WAS WITHOUT JURISDICTION TO CONDUCT A BENCH TRIAL
BECAUSE THE SUBSTANCE OF THE JURY WAIVER DID NOT
SUBSTANTIALLY COMPLY WITH THE SUGGESTED WORDING IN R.C.
2945.05.
{¶5} In her first assignment of error, Ms. Quinones argues that the trial court erred in
proceeding with her bench trial because the written jury waiver in this case did not substantially
comply with the wording set forth in R.C. 2945.05. We disagree.
{¶6} R.C. 2945.05 provides that, “[i]n all criminal cases pending in courts of record in
this state, the defendant may waive a trial by jury and be tried by the court without a jury.” “[T]o
be valid, a [jury] waiver must meet five conditions. It must be (1) in writing, (2) signed by the
defendant, (3) filed, (4) made part of the record, and (5) made in open court.” State v. Lomax,
114 Ohio St.3d 350, 2007-Ohio-4277, ¶ 9; R.C. 2945.05. This waiver should state in substance
as follows:
I __________, defendant in the above cause, hereby voluntarily waive and
relinquish my right to a trial by jury, and elect to be tried by a Judge of the Court
in which the said cause may be pending. I fully understand that under the laws of
this state, I have a constitutional right to a trial by jury.
R.C. 2945.05.
3
{¶7} “Although ‘Ohio courts have declined to find that the language of the waiver must
be a verbatim recitation of R.C. 2945.05,’ the content of the waiver must be in ‘[s]ubstantial
compliance’ with the suggested language.” State v. Woodbridge, 9th Dist. Summit No. 26911,
2014-Ohio-1338, ¶ 6, quoting State v. Webb, 10th Dist. Franklin No. 10AP-289, 2010-Ohio-
6122, ¶ 26-27, citing State v. Townsend, 3d Dist. Marion No. 9-03-40, 2003-Ohio-6992, ¶ 16.
{¶8} Here, Ms. Quinones signed a form that states:
The Defendant waives her constitutional right to a jury trial and consents to this
matter being tried to this one judge court. Furthermore, Defendant acknowledges
that at a jury trial the Defendant would have the right to participate in the
selection of twelve jurors, to exclude prospective jurors with and/or without cause
and to a unanimous verdict.
{¶9} Ms. Quinones maintains that the waiver she executed did not comply with R.C.
2945.05 because it failed to substantially state the statutory language in that (1) it is not stated in
the first person, (2) it does not state that the waiver is made voluntarily, (3) it does not provide
that Ms. Quinones would “relinquish” her right, (4) it does not provide that Ms. Quinones “elects
to be tried by a Judge of the Court in which the said cause may be pending[,]” and (5) it does not
state that Ms. Quinones “fully understands that under the laws of this state, she has a
constitutional right to a trial by jury.” (Emphasis omitted.) See R.C. 2945.05.
{¶10} In support of her position that the waiver does not substantially comply with the
statutory language, Ms. Quinones relies on this Court’s decision in Woodbridge, 2014-Ohio-
1338, where we held that a jury waiver did not substantially comply with the statutory language
because the waiver did not indicate that the defendant fully understood that he had a
constitutional right to a jury trial. Id. at ¶ 7, 9. Ms. Quinones maintains that, similarly, because
of the differences between the statutory language and the waiver here, it failed to indicate that
4
Ms. Quinones understood her rights. Instead, she maintains that the waiver reads like a court
order.
{¶11} However, in Woodbridge, the written waiver provided “I do hereby knowingly
and voluntarily waive my right to have my case tried by a jury of my peers and consent to my
case being tried by the Court.” Id. at ¶ 2, 6. We concluded that this waiver was substantially
similar to the first sentence provided in the statutory language. Id. at ¶ 7. However, there was
nothing in the written waiver indicating that the defendant understood that he had a constitutional
right to a jury trial. See id. Here, the waiver described the right as Ms. Quinones’
“constitutional right to a jury trial[.]” (Emphasis added.) Further, although the best practice
may be for the waiver to contain the statutory language verbatim, we cannot say that the writing
of the waiver in third person as opposed to first person resulted in the waiver not substantially
complying with the statutory language.
{¶12} Accordingly, Ms. Quinones’ first assignment of error is overruled.
ASSIGNMENT OF ERROR II
[MS. QUINONES’] CONVICTION WAS AGAINST THE MANIFEST
WEIGHT OF THE EVIDENCE.
{¶13} In her second assignment of error, Ms. Quinones argues that her conviction was
against the manifest weight of the evidence. We disagree.
{¶14} When a defendant asserts that her conviction is against the manifest weight of the
evidence:
an appellate court must review the entire record, weigh the evidence and all
reasonable inferences, consider the credibility of witnesses and determine
whether, in resolving conflicts in the evidence, the trier of fact clearly lost its way
and created such a manifest miscarriage of justice that the conviction must be
reversed and a new trial ordered.
State v. Otten, 33 Ohio App.3d 339, 340 (9th Dist.1986).
5
{¶15} Here, the trial court found Ms. Quinones guilty of trafficking in drugs in violation
of R.C. 2925.03(A)(2) and possession of drugs in violation of R.C. 2925.11(A). R.C.
2925.03(A)(2) provides that “[n]o person shall knowingly * * * [p]repare for shipment, ship,
transport, deliver, prepare for distribution, or distribute a controlled substance or a controlled
substance analog, when the offender knows or has reasonable cause to believe that the controlled
substance or a controlled substance analog is intended for sale or resale by the offender or
another person.” Trafficking in cocaine, where the amount of cocaine exceeds 100 grams, is a
first degree felony. R.C. 2925.03(C)(4)(g). R.C. 2925.11(A) provides that “[n]o person shall
knowingly obtain, possess, or use a controlled substance or a controlled substance analog.”
{¶16} At trial, the State presented the testimony of postal inspectors and officers
involved in the controlled delivery and investigation, and it submitted exhibits, including a report
from the Lorain County Crime Lab. The inspectors testified that they had received information
from another postal inspector stationed in Puerto Rico regarding two suspicious packages. The
postal inspector in Puerto Rico had obtained a search warrant for these packages. One package,
containing $12,000 in cash, was labeled as sent from a fictitious address of 1431 West 17th
Street, Lorain, Ohio, to an address in Puerto Rico. The other package, containing approximately
500 grams of cocaine, was labeled as sent from an address in Puerto Rico to a Brenda Rivera at
1880 East 37th Street, Lorain, Ohio. The cocaine had been wrapped in cellophane and placed
inside of oatmeal containers.
{¶17} The inspectors and officers testified that postal inspectors contacted the City of
Lorain Police Department and arranged for a controlled delivery of the package on January 16,
2014. The package addressed to Lorain, Ohio was sent directly to a postal inspector, who placed
a GPS monitoring device in the cellophane wrapping of one of the bundles of cocaine. The
6
inspector also equipped the mail package with a radio-wire which would alert officers when the
package was opened.
{¶18} On January 16, 2014, an officer watching the house, awaiting a postal inspector to
make the controlled delivery, noticed a maroon car parked on the street outside of the East 37th
Street residence. The officers learned that the car was registered to Angel Quinones of 1435
West 17th Street, Lorain, Ohio. The officers found this significant, as the cash package that had
been searched in Puerto Rico was mailed from a fictitious address of 1431 West 17th Street,
Lorain, Ohio.
{¶19} At approximately 12:37 p.m., a postal inspector delivered the package containing
the cocaine to the East 37th Street address listed on the shipping label. A woman, later identified
as Ms. Quinones, answered the door. The postal inspector indicated to Ms. Quinones that he had
a package for a Brenda Rivera. Ms. Quinones suggested that the residence was a correct location
for Brenda Rivera, and she signed for the package, signing the name Brenda Rivera.
Approximately ten to fifteen minutes after the delivery of the package, Ms. Quinones emerged
from East 37th Street residence carrying a black duffle bag. She placed the duffle bag in the
trunk of the maroon car, and she drove away from the residence. The officers effectuated a stop
of Ms. Quinones shortly thereafter, at which time they recovered the package containing the
cocaine from the black duffle bag in the trunk of the car. The package had not been opened,
although most of the shipping label had been torn off of the package. Upon being stopped, Ms.
Quinones indicated that she was intending to dump the package, and she stated that she lived at
1435 West 17th Street.
{¶20} An officer traveled to the 1435 West 17th Street residence while other officers
obtained a search warrant for that residence. While awaiting the search warrant, the officer
7
surveying the residence saw a man, later identified as Angel Quinones, Ms. Quinones’ husband,
twice exit the house, look down the street, and return to the home. Officers obtained a search
warrant of the Quinoneses’ residence. Inside, officers located oatmeal containers of the same
type that were used in concealing the cocaine in the mail package, empty priority mail boxes,
baggies, plastic gloves, and numerous small rubber bands. Inside a coat, which Mr. Quinones
told officers belonged to his wife, the officers located a letter addressed to Nancy Gonzalez at
1435 West 17th Street. The letter was from the USPS Asset Forfeiture Unit in Washington, D.C.
The officers also located “stacks” of cash in a nightstand. The officers obtained a cell phone
from Ms. Quinones’ person, and a cell phone from Mr. Quinones.
{¶21} After extracting information from the cell phones, the officers found the following
text messages were sent between the phones on the day of the delivery, commencing at about
12:30 p.m., summarized on an exhibit prepared by one of the officers as follows:
NANCY (NC) AND ANGEL QUINONES (AC) TEXT MESSAGE
CONVERSATION:
Time Person Message
12:30:52 AC You Ok
12:31:26 NC Yea still waiting
12:31:39 AC Ok
***
12:38:03 NC goin home
12:38:16 AC Ok
1:05:31 AC You ok
1:07:55 AC You ok
1:34:05 AC Babe you good call me
8
{¶22} In addition to these texts, officers discovered that there were over ten cell phone
calls made between the phones on January 16th prior to the Quinoneses being taken into custody.
Further, on the phone obtained from Ms. Quinones, there existed deleted photos of other mail
packages and labels.
{¶23} The package that the officers utilized in the controlled delivery was taken into the
possession of the officers and returned to the police station. A postal inspector and other officers
removed the GPS monitoring system and radio-wire from the package, and they transferred the
cocaine to plastic bags to send to a lab for testing. According to the lab report, which the
prosecutor referred to as a “stipulated” exhibit that was submitted, without objection, in lieu of
the testimony of the forensic analysis who prepared the report, the package delivered to Ms.
Quinones contained approximately 610 grams of cocaine.
{¶24} On behalf of the defense, Angel Quinones testified. He indicated that he had
pleaded guilty to drug charges, taking responsibility for the package at issue here. He
maintained that Ms. Quinones was unaware of the contents of the package, but he had told her to
pick up the package, which was being delivered to the home of her cousin Brenda, because it
contained a present for Ms. Quinones’ niece’s or nephew’s birthday. Mr. Quinones maintained
that he is not employed. He maintained that the cash located in his nightstand was his, and Ms.
Quinones was not aware of it. Also, he never informed Ms. Quinones as to his drug activities,
and she did not question him about the number of containers of oatmeal at the house. He did not
tell her what was contained in the package that he asked her to pick up, nor did he recall her
asking what it contained or why it was being delivered to a different address.
{¶25} On appeal, Ms. Quinones maintains that her conviction was against the manifest
weight of the evidence because of breaks in the chain of custody of the mail package, which she
9
maintains was the most significant evidence against her. “The chain of custody relates to the
authentication or identification process set forth in Evid. R. 901(A)[.]” State v. Meyers, 9th Dist.
Summit Nos. 23864, 23903, 2008-Ohio-2528, ¶ 49. However, “[t]he [S]tate is not required to
prove a perfect, unbroken chain of custody.” Id., quoting State v. Semedo, 5th Dist. Stark No.
2006 CA 00108, 2007-Ohio-1805, ¶ 12. “A break in the chain of custody, if any, goes to the
weight or credibility of the evidence, and not its admissibility.” Meyers at ¶ 49, quoting Semedo
at ¶ 12.
{¶26} In support of her position that the evidence speaking to the contents of the mail
package should not be given weight due to breaks in the chain of custody, she points out that the
postal inspector in Puerto Rico indicated that the package contained 500 grams of cocaine,
however, the lab report indicated that the package contained 610 grams of cocaine.
{¶27} Our review of the evidence admitted at trial indicates that, although the postal
inspector who initially opened the package in Puerto Rico did not testify at the hearing,
photographs of the contents of the package in Puerto Rico were admitted without objection. The
photographs display two packages, wrapped in cellophane, inside oatmeal containers, packed in
the package with the same shipping label as the package here. Although the testimony at trial
indicated that the postal inspector in Puerto Rico had represented that there was approximately
500 grams of cocaine in the package, there is no indication that the postal inspector in Puerto
Rico removed the entirety of the cocaine from its cellophane and other items from the packaging
of the bundle to determine a precise weight, and thus the weight could have been an estimate.
Two photographs taken by the postal inspector in Puerto Rico show the bundles of cocaine, still
covered in cellophane, and a red material, on scales. One picture shows the digital scale display
depicting the number 1, followed by a space, and then followed by the number 12.8. Another
10
picture shows what appears to be the same unwrapped bundles on the digital scale, with the
display depicting the number 0.820. The unit of measurement of weight cannot be seen clearly
on the scale display, but given the testimony as to the weight of the packages, it does not appear
that the inspector weighed the packages in grams or that the packaging was removed prior to the
inspector concluding that the packages contained five hundred grams of cocaine. The postal
inspector who received the package for the controlled delivery, testified that it was in the same
condition as the pictures taken in Puerto Rico had displayed.
{¶28} After a review of the record, we cannot conclude that this is the extraordinary
case where the trial court created a manifest miscarriage of justice in finding Ms. Quinones
guilty. Accordingly, Ms. Quinones’ second assignment of error is overruled
III.
{¶29} Ms. Quinones’ assignments of error are overruled. The judgment of the trial court
is affirmed.
Judgment affirmed.
There were reasonable grounds for this appeal.
We order that a special mandate issue out of this Court, directing the Court of Common
Pleas, County of Lorain, State of Ohio, to carry this judgment into execution. A certified copy of
this journal entry shall constitute the mandate, pursuant to App.R. 27.
Immediately upon the filing hereof, this document shall constitute the journal entry of
judgment, and it shall be file stamped by the Clerk of the Court of Appeals at which time the
period for review shall begin to run. App.R. 22(C). The Clerk of the Court of Appeals is
11
instructed to mail a notice of entry of this judgment to the parties and to make a notation of the
mailing in the docket, pursuant to App.R. 30.
Costs taxed to Appellant.
CARLA MOORE
FOR THE COURT
WHITMORE, J.
HENSAL, J.
CONCUR.
APPEARANCES:
GIOVANNA V. SCALETTA-BREMKE, Attorney at Law, for Appellant.
DENNIS P. WILL, Prosecuting Attorney, and NATASHA RUIZ GUERRIERI, Assistant
Prosecuting Attorney, for Appellee.
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213 P.3d 792 (2009)
2009-NMCERT-004
MUNIZ
v.
HEREDIA.
No. 31,580 (12-501).
Supreme Court of New Mexico.
April 13, 2009.
Writ Granted.
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IN THE COURT OF CRIMINAL APPEALS
OF TEXAS
NO. WR-71,557-01
EX PARTE RAY RECIO CORTEZ, Applicant
ON APPLICATION FOR A WRIT OF HABEAS CORPUS
CAUSE NO. B-04-0897-S IN THE 119TH JUDICIAL DISTRICT COURT
FROM TOM GREEN COUNTY
Per curiam.
O R D E R
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 entered an open plea of gulity to
aggravated kidnapping, and was sentenced to eighty years' imprisonment. The Third Court of
Appeals affirmed his conviction. Cortez v. State, No. 03-05-00256-CR (Tex. App. - Austin, May
30, 2007).
Applicant contends, inter alia, that he was denied the opportunity to petition this Court for
discretionary review because his appellate counsel failed to timely notify Applicant that his
conviction had been affirmed, and that he had a right to petition this Court for discretionary review
pro se. Appellate counsel has provided an affidavit responding to Applicant's writ allegations, in
which he states that he timely notified Applicant of the outcome of his appeal and of his right to file
a pro se PDR in a letter sent via regular mail to Applicant's prison address. Because Applicant's
mother contacted appellate counsel some time thereafter to inquire about the status of the appeal, and
informed appellate counsel that Applicant had not received counsel's first letter, counsel sent a
second letter via certified mail. After receiving the second letter, Applicant filed a motion for an
extension of time in which to file his PDR, which this Court denied because it was filed after the
period in which this Court may grant an extension under Appellate Rule 68.2(c).
The trial court had entered findings of fact and conclusions of law, finding inter alia that
appellate counsel did not render deficient performance. The trial court's findings are supported by
the record. Appellate counsel complied with the requirements described by this Court in Ex parte
Wilson, 956 S.W.2d 25 (Tex. Crim. App. 1997). However, it is possible that Applicant was deprived
of his opportunity to petition this Court for discretionary review due to a breakdown in the system,
rather than through any fault of appellate counsel's. See Ex parte Riley, 193 S.W. 3d. 900 (Tex.
Crim. App. 2006).
In these circumstances, additional facts are needed. As we held in Ex parte Rodriguez, 334
S.W.2d 294, 294 (Tex. Crim. App. 1960), the trial court is the appropriate forum for findings of fact.
The trial court shall obtain the mail logs from the prison unit where Applicant was confined between
June 9, 2007 and August 21, 2007, and shall supplement the habeas record with copies of such logs.
The trial court shall make then findings of fact as to whether Applicant received the letter
mailed by appellate counsel on June 9, 2007, informing Applicant that his conviction had been
affirmed. The trial court shall also make any other findings of fact and conclusions of law that it
deems relevant and appropriate to the disposition of Applicant's claim for habeas corpus relief.
This application will be held in abeyance until the trial court has resolved the fact issues. The
issues shall be resolved within 90 days of this order. If any continuances are granted, a copy of the
order granting the continuance shall be sent to this Court. A supplemental transcript containing all
affidavits and interrogatories or the transcription of the court reporter's notes from any hearing or
deposition, along with the trial court's supplemental findings of fact and conclusions of law, shall
be returned to this Court within 120 days of the date of this order. Any extensions of time shall be
obtained from this Court.
Filed: March 18, 2009
Do not publish
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Order Michigan Supreme Court
Lansing, Michigan
April 1, 2013 Robert P. Young, Jr.,
Chief Justice
146062 Michael F. Cavanagh
Stephen J. Markman
Mary Beth Kelly
Brian K. Zahra
Bridget M. McCormack
PEOPLE OF THE STATE OF MICHIGAN, David F. Viviano,
Plaintiff-Appellee, Justices
v SC: 146062
COA: 309280
Monroe CC: 83-019891-FY
JUAN CARLOS BIJARRO,
Defendant-Appellant.
_________________________________________/
On order of the Court, the application for leave to appeal the September 18, 2012
order of the Court of Appeals is considered, and it is DENIED, because the defendant has
failed to meet the burden of establishing entitlement to relief under MCR 6.508(D).
I, Corbin R. Davis, Clerk of the Michigan Supreme Court, certify that the
foregoing is a true and complete copy of the order entered at the direction of the Court.
April 1, 2013 _________________________________________
t0325 Clerk
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713 N.W.2d 715 (2006)
IN RE GAEDE.
No. 05-0891.
Court of Appeals of Iowa.
February 1, 2006.
Decision without published opinion. Affirmed.
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482 F.3d 1299
KH OUTDOOR, L.L.C., Dale P. Eggers, MooreA, Inc., Plaintiffs-Appellants,v.CLAY COUNTY, FLORIDA, Defendant-Appellee.
No. 06-11070.
United States Court of Appeals, Eleventh Circuit.
March 29, 2007.
G. Franklin Lemond, Jr., Edward Adam Webb, The Webb Law Group, LLC, Atlanta, GA, for Plaintiffs-Appellants.
William David Brinton, Cristine M. Russell, Ruth A. Holmes, Rogers Towers, PA, Jacksonville, FL, for Defendants-Appellee.
Appeal from the United States District Court for the Middle District of Florida.
Before BIRCH and BLACK, Circuit Judges, and MILLS,* District Judge.
BIRCH, Circuit Judge:
1
In this appeal, we must determine whether the district court properly denied a request for injunctive relief and damages brought by plaintiffs-appellants, KH Outdoor, L.L.C., MooreA, Inc., and Dale P. Eggers against defendant-appellee, Clay County, Florida, after the Board of County Commissioners Zoning Department denied several permit applications to construct billboards in Clay County. The district court dismissed the case, finding that it was moot. We conclude that, although the complaint of KH Outdoor is not moot because KH Outdoor requested damages for the alleged violation, KH Outdoor lacks standing. As a result, we AFFIRM the district court's dismissal of the case.
I. BACKGROUND
2
On 1 March 2004, KH Outdoor submitted seven building permit application packets to Cheryl Miller, defendant Clay County's Zoning and Code Enforcement Director. The applications sought permits to erect seven 672 square foot "off-premise signs" on seven different parcels of property within the County. Under "Contractor Name," the building permit application packages listed "Selective Structures." R74, App. 42-48. The accompanying construction-engineering drawings indicated that they were made for structures to be erected in Jacksonville, Florida. Miller did not accept the permits, explaining to KH Outdoor's representative that the Clay County Ordinance 98-7 ("Old Sign Ordinance") prohibited the erection of new billboards. Miller then sent KH Outdoor a letter formally denying the sign permit applications.
3
KH Outdoor did not administratively appeal the County's rejection of its permit applications. Instead, it filed suit in federal district court on 24 March 2004, pursuant to 42 U.S.C. § 1983, alleging that Clay County's Old Sign Ordinance was an unconstitutional content-based regulation of commercial and non-commercial speech that violated the First and Fourteenth Amendments to the United States Constitution, as well as Florida law. In connection with that action, KH Outdoor also filed a motion for preliminary injunction seeking to enjoin Clay County from enforcing the Old Sign Ordinance and, in effect, to require Clay County to issue the seven billboard sign permits KH Outdoor applied for in March 2004. After a hearing, the district court entered an order denying the motion finding that KH Outdoor had failed to show that it was substantially likely to prevail on the merits of its complaint.
4
On 25 June 2004, Clay County enacted Ordinance No. 2004-34 ("New Sign Ordinance"), which repealed and replaced the Old Sign Ordinance. KH Outdoor did not apply for a Clay County sign permit following the enactment of the New Sign Ordinance in June 2004.
5
On 4 February 2005, with leave of the district court, KH Outdoor filed a fifteen count Second Amended Complaint. The Second Amended Complaint added two additional party plaintiffs, MooreA, the owner of one of the parcels of land upon which KH Outdoor had sought a permit to erect a billboard—and with whom KH Outdoor had entered into a lease agreement to do so—and Eggers, MooreA's president.1 The Second Amended Complaint alleged the same as-applied and facial constitutional challenges to the Old Sign Ordinance that had been alleged in the original complaint.
6
KH Outdoor filed a motion for partial summary judgment and Clay County filed a motion for summary judgment. The district court dismissed the case for lack of subject matter jurisdiction, and ruled that the motions for summary judgment were moot. The district court found that there was no substantial likelihood of Clay County reenacting the Old Sign Ordinance and no bad faith on the part of Clay County.
7
The district court found that, even though KH Outdoor challenged numerous Old Sign Ordinance provisions, the provisions that actually caused the denial of the permits were: § 20.7-21(1) and (20) (prohibiting new billboards and off-premise signs); § 20.7-3 (defining off-premise signs); and § 20.7-8 (requiring that an Administrator review a properly completed and submitted permit application within a reasonable time). Section 20.7-21(1) was preserved in the New Sign Ordinance, but the district court found that it was constitutionally firm. Sections 20.7-21(20) and 20.7-3 of the Old Sign Ordinance defined and prohibited off-premise signs, but the New Sign Ordinance did not contain an outright prohibition of off-premise signs and the definition did not on its face prohibit noncommercial speech. As a result, the court found no constitutional infirmity in the New Sign Ordinance's provision that merely defines off-premise signs. Section 20.7-8 of the Old Sign Ordinance, requiring an Administrator to review a sign permit application "within a reasonable time," was replaced in the New Sign Ordinance with a provision requiring an Administrator to review and grant or deny the sign permit application within fifteen calendar days of receipt. As a result, the district court found that the provisions of the Old Sign Ordinance that actually caused the denial of the permit applications either did not survive or "are now (and perhaps always were) constitutionally sound." R97 at 14-17.
8
The court then ruled that any other constitutionally suspect provisions were severable, and thus KH Outdoor's challenges to the Old Sign Ordinance were moot. The court concluded that its mootness holding precluded KH Outdoor's claim for damages. Finally, the court found no evidence of bad faith or entitlement to equitable estoppel and, concluded that, therefore, KH Outdoor had no vested rights under Florida law with respect to the permits for which it applied under the Old Sign Ordinance. KH Outdoor appealed the district court's order.
II. STANDARD OF REVIEW
9
"We review the question of mootness de novo." Tanner Adver. Group, L.L.C. v. Fayette County, Ga., 451 F.3d 777, 784 (11th Cir.2006) (en banc) (citation omitted). "We review standing determinations de novo." Id. (citation omitted).
III. DISCUSSION
A. Mootness
10
"We exercise our discretion to review the issue of mootness first, followed by the issue of standing." Id. at 785 (citation omitted). "Article III of the Constitution requires that there be a live case or controversy at the time that a federal court decides the case; it is not enough that there may have been a live case or controversy when the case was filed." Id. (citation and internal quotations omitted). "The doctrine of mootness provides that the requisite personal interest that must exist at the commencement of the litigation (standing) must continue throughout its existence (mootness)." Id. (citations, alterations, and internal quotations omitted). We have noted that "[o]rdinarily, a challenge to the constitutionality of a statute is mooted by repeal of the statute." Id. (citation and internal quotations omitted).
11
KH Outdoors argues that its challenge to the Old Sign Ordinance was not rendered moot by the adoption of the New Sign Ordinance because its Second Amended Complaint included a request for damages. "[W]hen a plaintiff requests damages, as opposed to only declaratory or injunctive relief, changes to or repeal of the challenged ordinance may not necessarily moot the plaintiff's constitutional challenge to that ordinance." Crown Media, LLC v. Gwinnett County, Ga., 380 F.3d 1317, 1325 (11th Cir.2004) (citation omitted). Here, because KH Outdoor requested damages, the changes made to the ordinance do not moot KH Outdoor's challenge to the Old Sign Ordinance. See Granite State Outdoor Adver., Inc. v. City of Clearwater, Fla., 351 F.3d 1112, 1119 (11th Cir.2003) ("Clearwater") ("[T]he City argues that Granite State's claims are now moot because Clearwater has revised the Code in accordance with the district court's decision. Because Granite State has requested damages, however, the changes made to the ordinance do not make this case moot."). The district court erred in finding that KH Outdoor's case was moot.
B. Standing
12
The Constitution of the United States limits the subject matter jurisdiction of federal courts to "Cases" and "Controversies." U.S. Const., Art. III § 2. "[T]he core component of standing is an essential and unchanging part of the case-or-controversy requirement of Article III." Lujan v. Defenders of Wildlife, 504 U.S. 555, 560, 112 S.Ct. 2130, 2136, 119 L.Ed.2d 351 (1992). A plaintiff who invokes the jurisdiction of a federal court bears the burden of showing "(1) an injury in fact, meaning an injury that is concrete and particularized, and actual or imminent, (2) a causal connection between the injury and the causal conduct, and (3) a likelihood that the injury will be redressed by a favorable decision." Clearwater, 351 F.3d at 1116 (citation and emphasis omitted). Each element is "an indispensable part of the plaintiff's case" and "must be supported in the same way as any other matter on which the plaintiff bears the burden of proof, i.e., with the manner and degree of evidence required at the successive stages of the litigation." Lujan, 504 U.S. at 561, 112 S.Ct. at 2136 (citation omitted). Also, the plaintiff must satisfy certain prudential principles established by courts. Bennett v. Spear, 520 U.S. 154, 162, 117 S.Ct. 1154, 1161, 137 L.Ed.2d 281 (1997). These immutable requirements of the Constitution govern KH Outdoor's Second Amended Complaint.
13
KH Outdoor's "injury" is that it cannot erect its proposed billboards. See Clearwater, 351 F.3d at 1117 (finding Granite State suffered injury under the provision of the Clearwater code that denied Granite State's billboard permits). Moreover, this injury is causally related to the alleged constitutional violations challenged.
14
Clay County argues that KH Outdoor lacks standing to advance its claims because its injury from the billboard and off-site sign prohibition is not redressible. In order for an injury to be redressible, "it must be `likely,' as opposed to merely `speculative,' that the injury will be `redressed by a favorable decision.'" Lujan, 504 U.S. at 561, 112 S.Ct. 2130 (citation omitted).
15
We find that KH Outdoor has not satisfied the redressability requirement. Any injury KH Outdoor actually suffered from the billboard and offsite sign prohibition is not redressible because the applications failed to meet the requirements of other statutes and regulations not challenged. See Advantage Media, L.L.C. v. City of Eden Prairie, 456 F.3d 793, 801 (8th Cir.2006) ("[A] favorable decision for [outdoor advertising company] even with respect to those sign code provisions which were factors in the denial of its permit applications would not allow it to build its proposed signs, for these would still violate other unchallenged provisions of the sign code like the restrictions on size, height, location, and setback." (citation omitted)); Harp Adver. Ill., Inc., v. Village of Chicago Ridge, Ill., 9 F.3d 1290, 1292 (7th Cir. 1993) ("Harp suffers an injury (it can't erect the proposed billboard), but winning the case will not alter that situation.").
16
Although KH Outdoor alleges in its Second Amended Complaint that it "submitted seven (7) completed sign application packages," R57 at 13, the uncontroverted evidence suggests otherwise. Even assuming that the seven sign application packages met all the applicable permit application requirements found in the challenged Old Sign Ordinance, the evidence submitted with the parties' motions for summary judgment indicates that the application packages failed to comply with applicable provisions of the Florida Building Code and Florida statutes, which KH Outdoor did not challenge.
17
The Florida Building Code applies "to the construction [or] erection . . . of every public and private building, structure or facility or . . . any appurtenances connected or attached to such buildings, structures or facilities." Fl. Bldg.Code § 101.4.2. Florida Building Code § 104.2.1, regarding "[d]rawings and specifications," provides, in pertinent part, that "two or more copies of specifications, and of drawings drawn to scale with sufficient clarity and detail to indicate the nature and character of the work, shall accompany the application for a permit." The sign permit applications were not all accompanied by the requisite number of copies of construction-engineering drawings from licensed engineers drawn for Clay County.2 Moreover, Florida Building Code § 104.2.4 requires that drawings "show the location of the proposed building or structure and of every existing building or structure on the site or lot." The sign permit applications and accompanying documents submitted to Clay County plainly lacked the required drawings showing every existing structure on the subject sites.
18
Additionally, KH Outdoor's sign permit applications are not consistent with Florida statutes regarding contracting. The sign permit applications presented to Clay County listed Selective Structures as the contractor. Selective Structures was not a licensed building contractor in the state of Florida. The licensed general contractor here, Richard Nation, did not have the ability, under Chapter 489 of the Florida Statutes, to submit the sign permit applications in the name of an unlicensed contractor. See § 489.127(4)(a) ("A certified or registered contractor, or contractor authorized by a local construction regulation board to do contracting, may not enter into an agreement, oral or written, whereby his or her certification number or registration number is used, or to be used, by a person who is not certified or registered as provided for in this chapter, or used, or to be used, by a business organization that is not duly qualified as provided for in this chapter to engage in the business, or act in the capacity, of a contractor."). As a result, a favorable decision, that is, invalidation of the Old Sign Ordinance provisions KH Outdoor challenged, does not mean KH Outdoor would then receive approval of its sign permit applications, because Clay County could block the proposed signs by enforcing other state statutes and regulations not challenged.3
19
As a final matter, because we find KH Outdoor lacks constitutional standing, we cannot reach the merits of its challenges, either as applied or under the overbreadth doctrine, to Clay County's sign ordinance. "[T]he overbreadth doctrine does not relieve a plaintiff of the burden to prove constitutional standing[;]" it is only an exception to one of the prudential requirements. CAMP Legal Def. Fund, Inc. v. City of Atlanta, 451 F.3d 1257, 1270 (11th Cir.2006); see also Bischoff v. Osceola County, Fla., 222 F.3d 874, 885 (11th Cir.2000) (analyzing the three constitutional prongs of standing before considering plaintiff's facial challenge under the overbreadth doctrine); Wis. Right to Life, Inc. v. Paradise, 138 F.3d 1183, 1186 (7th Cir. 1998) ("A litigant cannot create a case or controversy just by making an untenable `facial' attack on a statute; actual injury and redressability are essential no matter how the challenge is cast.").
IV. CONCLUSION
20
Here, a favorable decision for KH Outdoor with respect to the sign code provisions challenged would not allow it to build its proposed signs, because the sign permit applications failed to meet other statutes and regulations that were not challenged. Because we find the appellants, KH Outdoor, L.L.C., MooreA, Inc., and Dale P. Eggers, lack standing, the district court's order dismissing the Second Amended Complaint for lack of jurisdiction is AFFIRMED.
Notes:
*
Honorable Richard Mills, United States District Judge for the Central District of Illinois, sitting by designation
1
For simplicity, henceforth we refer to the three plaintiff-appellants collectively as "KH Outdoor."
2
Additionally, as noted previously, the building permit packages did not have construction-engineering drawings for structures to be erected in Clay County, Florida, but rather, had drawings prepared for Jacksonville, Florida
3
We note that the Fourth Circuit, in an unpublished decision, reached a similar resultSee Trinity Outdoor, L.L.C. v. City of Rockville, Md., 123 Fed.Appx. 101, 104-05 (4th Cir. 2005) (per curiam) (affirming the district court's holding that the billboard company's alleged injuries were not redressable by the remedy it sought, in that the billboard company "was neither registered to do business in Maryland nor licensed to engage in the outdoor advertising business in that State").
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775 So.2d 1049 (2000)
Helen H. WILLIS, et al.
v.
David MEDDERS, et al.
No. 00-C-2507.
Supreme Court of Louisiana.
December 8, 2000.
*1050 PER CURIAM.
In this products liability action against the manufacturer of the vehicle in which plaintiff was injured as a passenger, plaintiff alleged that the vehicle had a defective seatbelt restraint system. The manufacturer moved for summary judgment on the basis that plaintiff could not establish the existence of a feasible alternative design at the time the vehicle left the manufacturer's control that would have prevented the plaintiffs injury and that the risk sought to be avoided by the alternative design outweighed the cost of adopting the design. The trial court granted summary judgment in favor of the defendant-manufacturer.
On appeal, plaintiff argued that his engineering expert's affidavit established the existence of proposed alternative designs. Plaintiff further argued that a reasonable inference could be drawn from the expert's statements that such alternative design was being used and was economically feasible at the time the product left the manufacturer's control. The court rejected these arguments, reasoning that the expert's affidavit "would have been more persuasive" if it had stated that such technology was available sufficiently in advance of the manufacture of the vehicle at issue that it would have been reasonable to expect the manufacturer-defendant to have employed such technology and had it stated which other car manufacturers were using such technology. Willis v. Medders, 99-2170 (La.App. 4th Cir.5/24/00), 765 So.2d 1093. The appellate court thus chastised the expert's affidavit as being "very vague" and containing "general statements" from which it refused to infer the specifics needed to defeat the defendant-manufacturer's summary judgment motion.
The court of appeal erred in several respects. First, despite the legislative mandate that summary judgments are now favored, factual inferences reasonably drawn from the evidence must be construed in favor of the party opposing the motion, and all doubt must be resolved in the opponent's favor. See Independent Fire Insurance Co. v. Sunbeam Corp., 99-2181, 99-2257 at pp. 16-17 (La.2/29/00), 755 So.2d 226, 236 (noting the court, "must draw those inferences from the undisputed facts which are most favorable to the party opposing the motion"); See also Hebert v. St. Paul Fire and Marine Ins. Co., 99-0333 (La.App. 4th Cir.2/23/00), 757 So.2d 814, cert. denied, 00-0861 (La.5/5/00), 761 So.2d 550. Under that standard, the lower courts erred in failing to find a genuine issue of material fact created by the inferences reasonably drawn from the expert's affidavit.
*1051 Second, the appellate court erred in assessing the persuasiveness of plaintiffs expert's views on summary judgment. See Independent Fire, 99-2181, 99-2257 at p. 17 (La.2/29/00), 755 So.2d 226, 236 (noting that "the court must not attempt to evaluate the persuasiveness of competing scientific studies" on summary judgment in performing its gate keeping function). The court of appeal's focus on how the plaintiffs expert could have been "more persuasive" and on what his expert "did not say" was misplaced. Properly viewed, plaintiffs expert stated that the proposed alternative design was being used, and one could reasonably infer from his statement that such alternative was economical, i.e., satisfied the risk-utility standard.
Finally, and most importantly, when the party opposing the summary judgment motion submits expert opinion evidence that would be admissible and that is sufficient to allow a reasonable juror to conclude the expert's opinion on a material fact more likely than not is true, the court should deny the summary judgment motion. Independent Fire, supra.
Accordingly, the application is granted, the summary judgment is set aside, and the case is remanded for further proceedings.
TRAYLOR, J., dissents from the order and would deny the writ.
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267 B.R. 907 (2001)
In re INTERSTATE GROCERY DISTRIBUTIONS SYSTEM, INC. and G & M Realty Corp., Debtors.
No. 96-29457(DHS).
United States Bankruptcy Court, D. New Jersey.
October 4, 2001.
*908 Pamela A. Hulnick, Kaplan & Hulnick, LLC, Hackensack, NJ, for Chance Freight Station, Inc.
Daniel M. Eliades, Forman Holt & Eliades, LLC, Rochelle Park, NJ, for Barbara Edwards, Chapter 7 Trustee.
OPINION
DONALD H. STECKROTH, Bankruptcy Judge
This matter is before the Court upon motion by Chance Container Freight Station, Inc. ("Chance" or "Movant") seeking (1) relief pursuant to Federal Rule of Civil Procedure 60(b) from the July 25, 2000 order of this court directing turnover of Chance's real estate deposit to the Chapter 7 trustee; and (2) payment of a Chapter 7 administrative expense claim for work performed which allegedly benefitted the estate. Barbara Edwards, the Chapter 7 trustee ("Trustee"), has opposed the motion.
The motion was scheduled for hearing on June 25, 2001, at which time the Court adjourned proceedings until July 16, 2001 to give Movant's counsel time to properly notice Rachel Kaplan, Esq. and her law firm, Movant's former attorney, because serious allegations of attorney negligence were made against Ms. Kaplan in the Movant's certification in support of its motion. On July 16, 2001, neither Ms. Kaplan nor her firm appeared in court, nor have certifications been filed denying the allegations. The Court heard argument and reserved decision, giving the parties the time they requested to attempt to amicably resolve the matter. Their efforts have not been successful and this opinion now issues.
The court has jurisdiction over the matter pursuant to 28 U.S.C. §§ 1334(b) and 28 U.S.C. § 157(a). This is a core proceeding under 28 U.S.C. § 157(b)(2)(A), (B), (E) and (O). Venue is proper under 28 U.S.C. § 1409(a). The following shall constitute the court's findings of fact and conclusions of law, in accordance with Bankruptcy Rule 7052.
FINDINGS OF FACT
Interstate Grocery Distributions System, Inc. ("Interstate"), filed a petition *909 under Chapter 11 of the Bankruptcy Code on October 22, 1996. On March 5, 1997, an order was entered converting the proceeding to a Chapter 7 case. On May 22, 2000, an order was entered extending the Interstate bankruptcy proceeding to encompass G & M Realty Corporation ("G & M"), a wholly-owned corporation of Interstate's sole shareholder, and directed that the assets and liabilities of G & M be consolidated with the Chapter 7 estate of Interstate. The Trustee was directed to administer the consolidated estate. Thereafter, pursuant to motion by the Trustee, an order was entered on July 25, 2000 directing the turnover of Chance's deposit paid to G & M's attorney for the purchase of real property commonly known as 2200 48th Street, North Bergen, New Jersey (the "Property"). Said Property was owned by G & M Realty and had been the site of Interstate's trucking business.
In October 1999, Francisco Torres, president of Chance, entered into contract negotiations for the purchase of the Property from G & M. The terms of the contract provided for a $300,000 purchase price and a $15,000 deposit to be paid by Chance. Rachel Kaplan, Esq. was retained to represent Chance in the transaction. On November 18, 1999, Ms. Kaplan forwarded a $15,000 deposit check to G & M's attorney along with a signed copy of the contract. This was prior to the extension of the Interstate bankruptcy proceedings to G & M. Thereafter, Chance voluntarily undertook efforts to clean-up and repair the Property so that it would be ready for occupancy upon closing. The contract does not give Chance authority to undertake this work and no use and occupancy agreement providing for Chance to perform work on the Property was signed.
In February 2000, Ms. Kaplan received notice from the Trustee of the Interstate bankruptcy proceeding and the motion seeking substantive consolidation of G & M with the bankruptcy estate. She was advised that closing on the Property could not take place until the Trustee's motion to consolidate was decided. Trustee's counsel also contacted Ms. Kaplan by letter and requested documentation regarding the real estate transaction. The letter advised that once the documents were reviewed, the Trustee would be in a position to consider whether to move the approval of the contemplated sale before the bankruptcy court. The requested documents were not provided. A second letter dated June 14, 2000 was forwarded to counsel enclosing the court's consolidation order. The letter reiterated the request for documents and the possibility of moving forward with the sale with the approval of the bankruptcy court. Again, Chance's counsel failed to respond.
G & M's counsel advised the Trustee that he had previously forwarded a time of the essence letter to Chance's counsel demanding that Chance close and that Chance did not close and had defaulted on the purchase. He advised that he held Chance's $15,000 deposit in trust and that G & M had taken the position that Chance had breached the parties' agreement by not closing. As a result, the Trustee filed a motion seeking an order directing turnover of the deposit as property of the estate ("Turnover Motion") on notice to Ms. Kaplan, Chance's counsel. Chance did not respond to the Turnover Motion and an order granting turnover was entered on July 25, 2000.
The Trustee subsequently retained a realtor to market and sell the Property. A sale was approved by the bankruptcy court and a closing took place on May 30, 2001. The closing price was $367,500 less a $20,000 credit to the buyer for environmental remediation.
*910 Chance acknowledges that it was advised in February 2000 about the bankruptcy proceedings and the delay in closing by Ms. Kaplan, its counsel. Chance asserts that Ms. Kaplan assured Chance that she would keep them advised of the situation. After a few additional months of inactivity, Chance contacted Ms. Kaplan but states it received no response. Finally, in October 2000, Chance contacted the Trustee directly, asking her to return the deposit monies as it did not appear that the closing would take place. It was at this time that Chance discovered the court had ordered the turnover of the $15,000 deposit to the Trustee. Eleven months after the July 25, 2000 order was entered and almost eight months after learning of the actual turnover of the deposit, Chance comes before the court on the instant motion seeking relief.
LEGAL CONCLUSION
Chance asserts that it is entitled to relief from the turnover order of July 25, 2000 under Federal Rule of Civil Procedure 60(b). In short, Chance argues that its attorney's failures constitute excusable neglect under Rule 60(b) and that the court should grant it relief and reverse the order turning over the $15,000 deposit to the Trustee. Additionally, Chance seeks payment of a Chapter 7 administrative expense claim pursuant to 11 U.S.C. § 503(b)(1)(A) for the work it performed on the Property which it asserts was performed post petition and caused an increase in value, thus providing a benefit to the estate.
In response, the Trustee argues that Chance, after failing to oppose the Turnover Motion and waiting almost a year after its entry, has not established a valid case for excusable neglect under Rule 60(b). Secondly, the Trustee argues that Chance is barred as a matter of law from obtaining an administrative expense under § 503(b) for the costs it voluntarily incurred in connection with the Property because it failed to provide benefit to the estate. 11 U.S.C. § 503(b).
The court must determine whether the neglect of Chance's attorney and Chance's own neglect and delay in bringing this motion constitute excusable neglect under Federal Rule of Civil Procedure 60(b). Rule 60(b), made applicable to bankruptcy cases by Federal Rule of Bankruptcy Procedure 9024,[1] states in pertinent part:
(b) Mistakes; Inadvertence; Excusable Neglect; Newly Discovered Evidence; Fraud, Etc. On motion and upon such terms as are just, the court may relieve a party or a party's legal representative from a final judgment, order, or proceeding for the following reasons: (1) mistake, inadvertence, surprise, or excusable neglect . . . or (6) any other reason justifying relief from the operation of the judgment. The motion shall be made within a reasonable time, and for reasons (1), (2), and (3) not more than one year after the judgment, order or proceeding was entered or taken.
In Pioneer Investment Services Co. v. Brunswick Associates Limited Partnership, *911 507 U.S. 380, 113 S.Ct. 1489, 123 L.Ed.2d 74 (1993), the Supreme Court set forth the analysis required for a finding of "excusable neglect" in a matter involving Bankruptcy Rule 9006.[2] In Pioneer, the Supreme Court determined that a Chapter 11 creditor was entitled to file its proof of claim after the deadline set by the bar date because its failure to file timely was the result of excusable neglect within the meaning of Rule 9006. Id. at 398-99, 113 S.Ct. 1489. The Supreme Court held that "Congress plainly contemplated that the courts would be permitted, where appropriate, to accept late filings caused by inadvertence, mistake, or carelessness, as well as by intervening circumstances beyond the party's control." Id. at 388, 113 S.Ct. 1489.
The Supreme Court in Pioneer stated that whether neglect is excusable is an "equitable" determination that "tak[es] account of all relevant circumstances surrounding the party's omission." Id. at 395, 113 S.Ct. 1489. To make an excusable neglect determination, the Court listed four factors for trial courts to consider: "the danger of prejudice to the debtor, the length of the delay and its potential impact on judicial proceedings, the reason for the delay, including whether it was within the reasonable control of the movant, and whether the movant acted in good faith." Id. at 395, 113 S.Ct. 1489. Significantly, the Court found that clients "must be held accountable for the acts and omissions of their attorneys" and that the "proper focus is upon whether the neglect of [the clients] and their counsel was excusable." (Emphasis added) Id. at 396-97, 113 S.Ct. 1489.
The Third Circuit Court of Appeals in In re O'Brien Environmental Energy, Inc., extended the Pioneer holding to Rule 60(b) actions:
The phrase "excusable neglect" appears not only in Rule 9006(b) but in Federal Rules of Civil Procedure 6(b), 13(f), and 60(b), Federal Rule of Criminal Procedure 45(b), and Federal Rule of Appellate Procedure 4(a). The Supreme Court referred to each of these rules in construing the "excusable neglect" analysis in Pioneer. Pioneer, therefore, is commonly understood to provide guidance not just with regard to Rule 9006, but in other bankruptcy contexts discussing the issue of excusable neglect (citations omitted) . . . Thus, the Pioneer analysis applies in the context of a Rule 60(b) motion, as in this case.
188 F.3d 116, 126, n. 7 (3rd Cir.1999).
In the instant matter, Chance argues that its attorney's actions or inactions constitute "excusable neglect" sufficient to grant it relief from the turnover order under Rule 60(b). In support of this position, Chance relies upon In re Johnson, 232 B.R. 319, 322 (Bankr.D.N.J.1999), a case which considered the parameters of "excusable neglect" under Rule 60(b) and which held that:
[a]n attorney's negligence absolutely qualifies as excusable neglect under Rule 60(b), but does not under Bankruptcy *912 Rule 9006. See In re Pioneer, supra. This relates in part to the equitable nature of Rule 60(b) on the one hand; and to the concerns for finality of Bankruptcy Rule 9006 on the other hand.
Johnson, however, was decided prior to the Third Circuit's decision in O'Brien Environmental which determined the Pioneer analysis applicable to a Rule 60(b) motion. The court is also mindful of the split of authority on the issue of whether attorney negligence constitutes "excusable neglect"[3] and notes that a decision by a trial court judge is not binding on other judges within the same court. Threadgill v. Armstrong World Indus., 928 F.2d 1366, 1371 (3rd Cir.1991); In re Mays, 256 B.R. 555, 559 (Bankr.D.N.J.2000).
In Johnson, the debtor filed a motion to void the lien of a creditor under 11 U.S.C. § 522(f). The creditor's attorney filed opposition to the motion, but failed to raise the appropriate legal issues. 232 B.R. at 320. The attorney also failed to appear before the court on the hearing date and the court entered the order as "uncontested." The creditor's attorney did not file a motion for reconsideration within the 10-day time period required by the local bankruptcy rules. See L.B.R.D.N.J. 9013-1(h). He did, however, write a letter to the court approximately three weeks later in which he requested the court reschedule the matter and dispense with the requirement of a motion for reconsideration. Id. at 320. The court advised counsel that a motion was necessary. Less than three months after the initial order was entered, the creditor's new counsel filed a motion to vacate the order. In holding in favor of the creditor based on excusable neglect, the court held that Pioneer "relates only to enlargement of time for late filed proofs of claim under Fed. R.Bankr.P. 9006, not motions under Fed. R.Civ.P. 60(b)." Id. at 323. Having made that determination, the bankruptcy court granted relief to an otherwise blameless party for his attorney's negligence and found the attorney's negligence constituted excusable neglect sufficient to grant relief under Rule 60(b).
In the case at bar, this court disagrees with Chance's assertion that its attorney's inaction requires a finding of "excusable neglect." There are significant facts which mitigate against this creditor when applying the Pioneer test. Chance is not blameless. It admits to being aware of the bankruptcy proceedings as early as February 2000. Long after failing to receive responses from its counsel, Chance contacted the trustee in October 2000, approximately three months after the turnover order was entered. At that time, Chance was made fully aware of the bankruptcy extension over the assets of G & M and, most importantly, the Property which it sought to purchase as well as the turnover of its deposit to the Trustee. Inexplicably, Chance waited until May 21, 2001, to file the instant motion. While the court recognizes that a Rule 60(b) motion may be made within one year, much of the case law granting relief for excusable neglect involves motions brought within a much shorter period of time. See e.g., Johnson, supra (less than three months); O'Brien Environmental, supra (two-month delay); In re Cendant Corp. PRIDES Litigation, *913 235 F.3d 176, 183 (3rd Cir.2000) (three-week delay). The length of delay in seeking relief is significant. See O'Brien Environmental, supra, at 129-130. Here, Chance waited almost eight months after learning of its attorney's negligence and no reasonable explanation is proffered for the length of this delay nor proof that such delay was out of the creditor's control. In addition, the court observes that it has been offered no legal justification for the return of the deposit to Chance since Chance defaulted under the contract of sale. Finally, Chance is not without relief. It still has available causes of action based on the allegations of negligence it has set forth in its certifications. Any relief, however, should not equitably come from this estate because the creditor's neglect is not excusable. Thus, the motion for relief under Rule 60(b) is denied.
The second issue raised is whether Chance is entitled to an administrative expense claim under 11 U.S.C. § 503(b)(1)(A) for the work it performed on the Property in anticipation of closing. Chance argues it is entitled to an administrative claim of $26,794.40 for the cost of goods and services provided in improving the Property. It contends that the clean-up work increased the value and selling price of the Property. In contrast, the Trustee urges the court to deny Chance's request for an administrative claim because the activities pursued by Chance were performed voluntarily, solely for Chance's self interest and without benefit to the estate. The Trustee points out there was no benefit to the estate because the Property was ultimately sold for a sum less than the liens held by the secured creditors and no funds were therefore made available to the general creditors through Chance's efforts.
Section 503(b)(1)(A) of the Code defines an administrative expense as including, "[t]he actual, necessary costs and expenses of preserving the estate, including wages, salaries, or commissions for services rendered after the commencement of the case . . ." Administrative expenses are categorized as a first priority claim in a bankruptcy case. 11 U.S.C. § 507(a)(1). The purpose of granting administration expenses with a priority for payment is to encourage creditors to cooperate with a debtor's reorganization efforts so that the debtor can effectively reorganize and continue its business, thereby maximizing the value of the estate for the benefit of all creditors and preventing unjust enrichment of the bankrupt estate. In re The Grand Union Co., 266 B.R. 621, 625-26 (Bankr.D.N.J.2001); In re Baldwin Rental Centers, Inc., 228 B.R. 504, 511 (Bankr. S.D.Ga.1998) (citing Alabama Surface Mining Comm'n v. N.P. Mining Co. (In re N.P. Mining Co.), 963 F.2d 1449, 1452 (11th Cir.1992)). The burden of proving entitlement to an administrative expense claim is on the claimant and the measure of proof is preponderance of the evidence. In re Drexel Burnham Lambert Group, Inc., 134 B.R. 482 (Bankr.S.D.N.Y.1991).
Courts have established demanding criteria for determining whether a claim should be afforded an administrative priority. In re Molnar Bros., 200 B.R. 555 (Bankr.D.N.J.1996); In re Mahoney-Troast Construction Company, 189 B.R. 57 (Bankr.D.N.J.1995); In re Hanlin Group, Inc., 176 B.R. 329, 333 (Bankr. D.N.J.1995); In re Lease-A-Fleet, Inc., 140 B.R. 840, 844-45 (Bankr.E.D.Pa.1992). The seminal case In re Mammoth Mart, Inc., 536 F.2d 950, 954 (1st Cir.1976) sets forth the test generally followed. First, the claim must arise from a post-petition transaction with the debtor. Second, when the claim is based on a contract between the debtor and the claimant, a creditor's right to payment will be afforded first priority only to the extent that the consideration *914 supporting the claimant's right to payment was both supplied to and beneficial to the estate. Id. See also, In re Molnar Bros., 200 B.R. at 559 (citations omitted).
The real estate transaction between Chance and G & M started in October 1999. At that time, G & M was not in bankruptcy. In May 2000, the order consolidating the G & M assets and liabilities with Interstate's bankruptcy proceeding was entered. Thus, the contract with G & M for the purchase of the Property predated the extension proceeding and, in fact, was never approved by the Bankruptcy Court. The services performed by Chance which it alleges are entitled to administrative expense priority have not been demonstrated, by a preponderance of the evidence, to have been performed after the extension of the bankruptcy proceeding over the G & M assets. The timing of the services, however, is not the only failure.
The second prong of the Mammoth Mart test is whether there has been a substantial contribution warranting reimbursement as an administrative expense and the applicant has shown an actual and demonstrable benefit to the debtor's estate and creditors. Lebron v. Mechem Financial, Inc., 27 F.3d 937 (3rd Cir.1994). Inherent in this concept is that the benefit received by the estate must be more than an incidental benefit arising from the applicant's activities pursued in protecting the applicant's own interest. Id. See also In re Bellman Farms, Inc., 140 B.R. 986 (Bankr.D.S.D.1991) (where it was determined a creditor's efforts undertaken solely to further its own self interest are not compensable); In re Halyard Realty Trust, 37 B.R. 260, 264 (Bankr.D.Mass. 1983)("[c]laims arising out of the performance of services by one who has acted in private capacity, which have the incidental effect of preserving debtor's property, are not entitled to priority status and such claims have only a general claim against the estate.").
Here, Chance contends that its actions benefitted the estate through improvements to the Property which resulted in an increased selling price. The Chance contract was for $300,000. The Property ultimately sold for a net price of $347,500. Despite this increase, there is no indication or proof in the record that the higher sale price resulted from the voluntary services of Chance (as opposed to simple market increases) and, in any event, the Property was sold for less than the secured liens. Absent a carve out by the secured creditors to the estate, unsecured creditors would not receive any distribution from the sale and thus no benefit has been realized. Finally, the court points out that the actions of Chance were performed in furtherance of its private interest in anticipation of having the Property ready for occupancy on the date of closing, and there was no agreement in place allowing these services to be performed. Chance assumed the risk of any costs it incurred in improving the Property. The court finds that the actions of Chance were without authority and did not benefit the estate. An administrative expense claim is not warranted.
CONCLUSION
For all of the above reasons, Chance's motion seeking relief from the July 25, 2000 turnover order under Rule 60(b) and for payment of an administrative expense claim is DENIED. The attached order has been entered by the Court.
NOTES
[1] Rule 9024 provides:
Rule 60 F.R.Civ.P. applies in cases under the Code except that (1) a motion to reopen a case under the Code or for the reconsideration of an order allowing or disallowing a claim against the estate entered without a contest is not subject to the one year limitation prescribed in Rule 60(b), (2) a complaint to revoke a discharge in a chapter 7 liquidation case may be filed only within the time allowed by § 727(e) of the Code, and (3) a complaint to revoke an order confirming a plan may be filed only within the time allowed by § 1144, § 1230, or § 1330.
[2] Fed. R. Bankr.P. 9006(b)(1) provides:
(b) Enlargement.
(1) In General. Except as provided in paragraphs (2) and (3) of this subdivision, when an act is required or allowed to be done at or within a specified period by these rules or by a notice given thereunder or by order of court, the court for cause shown may at any time in its discretion (1) with or without motion or notice order the period enlarged if the request therefor is made before the expiration of the period originally prescribed or as extended by a previous order or (2) on motion made after the expiration of the specified period permit the act to be done where the failure to act was the result of excusable neglect. (Emphasis added)
[3] In contrast to Judge Gindin's decision in Johnson, several cases have held that attorney negligence rarely establishes excusable neglect under Rule 60(b). In re Richard Morris, 252 B.R. 41, 46 (Bankr.S.D.N.Y.2000) (citing Mason Tenders Dist. Council Welfare Fund v. M & M Contracting & Consulting, 193 F.R.D. 112, 115 (S.D.N.Y.2000); Cobos v. Adelphi Univ., 179 F.R.D. 381, 385 (E.D.N.Y.1998)); and S.E.C. v. McNulty, 137 F.3d 732 (2nd Cir.1998) (where attorney conduct was not determined to constitute excusable neglect).
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881 F.2d 1076
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.NATIONAL LABOR RELATIONS BOARD, Petitioner,v.A ALPHA INDUSTRIES, INC., Respondent.
No. 89-5757.
United States Court of Appeals, Sixth Circuit.
Aug. 9, 1989.
Before: KRUPANSKY and RYAN, Circuit Judges; and LIVELY, Senior Circuit Judge.
1
JUDGMENT ENFORCING AN ORDER OF THE NATIONAL LABOR RELATIONS BOARD
2
This cause was submitted upon the applicationof the National Labor Relations Board for summary entry of a judgment against Respondent, A Alpha Industries, Inc., its officers, agents, successors, and assigns, enforcing its order dated February 9, 1989, in Case No. 7-CA-26928, and the Court having considered the same, it is hereby
3
ORDERED AND ADJUDGED by the Court that the Respondent, A Alpha Industries, Inc., its officers, agents, successors, and assigns, shall:
1. Cease and desist from:
4
(a) Discharging or otherwise discriminating against employees because they seek to obtain representation by a union.
5
(b) Coercively interrogating employees concerning their or other employees' union activities and sympathies.
6
(c) In any like or related manner interfering with, restraining, or coercing employees in the exercise of rights guaranteed them by Section 7 of the National Labor Relations Act (hereinafter called the Act).
7
2. Take the following affirmative action designed to effectuate the policies of the Act:
8
(a) Offer Jeff Wells and Kevin Russell immediate and full reinstatement to their former jobs or, if no longer in existence, to substantially equivalent jobs, without prejudice to their seniority and other rights and privileges previously enjoyed, and make them whole, with interest, for any loss of earnings suffered as a result of the discrimination practiced against them, in the manner set forth in the "Remedy" section of the Administrative Law Judge's Decision.
9
(b) Expunge from its files any references to the discharge of Wells and Russell, and notify them in writing that this has been done and that their discharge will not be used against them in any way.
10
(c) Preserve and, upon reasonable request, make available to the Board and its agents, for examination and copying, all payroll records and reports and all other records required to ascertain the amount, if any, of backpay due under this Judgment.
11
(d) Post at its facility in Durand, MI, copies of the Notice attached hereto. Copies of said Notice on forms provided by the Regional Director for Region 7 of the National Labor Relations Board (Detroit, Michigan), after being duly signed by an authorized representative of Respondent, shall be posted by Respondent immediately upon receipt thereof and be maintained by it for 60 consecutive days thereafter, in conspicuous places, including all places where notices to employees are customarily posted. Reasonable steps shall be taken by Respondent to insure that said Notice is not altered, defaced or covered by any other material.
12
(e) Notify the said Regional Director, in writing, within 20 days from the date of this Judgment, what steps the Respondent has taken to comply herewith.
APPENDIX
NOTICE TO EMPLOYEES
13
POSTED PURSUANT TO A JUDGMENT OF THE UNITED STATES COURT OF
14
APPEALS ENFORCING AN ORDER OF THE NATIONAL LABOR
RELATIONS BOARD
AN AGENCY OF THE UNITED STATES GOVERNMENT
15
AFTER A TRIAL AT WHICH ALL SIDES HAD AN OPPORTUNITY TO PRESENT EVIDENCE AND STATE THEIR POSITIONS, THE NATIONAL LABOR RELATIONS BOARD FOUND THAT WE HAVE VIOLATED THE NATIONAL LABOR RELATIONS ACT, AS AMENDED, AND HAS ORDERED US TO POST THIS NOTICE AND DO WHAT IT SAYS.
16
THE NATIONAL LABOR RELATIONS ACT GIVES YOU THESE RIGHTS:
17
To engage in self-organization.
18
To form, join, or help unions.
19
To bargain collectively through representatives of your own choosing.
20
To act together for collective-bargaining or other mutual aid or protection.
21
To refrain from any or all of these things.
22
WE WILL NOT discourage activity on behalf of any labor organization by discharging or in any other manner discriminating against you in regard to any term or condition of employment.
23
WE WILL NOT coersively interrogate you concerning your or any other employees' union activities and sympathies.
24
WE WILL NOT, in any like or related way, interfere with, restrain or coerce you in the exercise of your rights under the National Labor Relations Act.
25
WE WILL offer Jeff Wells and Kevin Russell immediate and full reinstatement to their former jobs or, if no longer in existence, to substantially similar jobs, without prejudice to their seniority or other rights and privileges, and make them whole, with interest, for any loss of earnings they may have suffered as a result of our discriminatory act in firing them.
26
WE WILL expunge from our records any references to the discharge of Jeff Wells and Kevin Russell and will notify them, in writing, that this has been done and that it will not be used against them.
27
A ALPHA INDUSTRIES, INC.
28
(Employer)
Dated ________ By ____________________
29
(Representative) (Title)
30
This is an official notice and must not be defaced by anyone.
31
This notice must remain posted for 60 consecutive days from the date of posting and must not be altered, defaced, or covered by any other material. Any questions concerning this notice or compliance with its provisions may be directed to the Board's Office: 477 Michigan Ave, Room 300, Detroit, MI 48226-2569, Telephone (313) 226-3219.
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545 P.2d 792 (1976)
The STATE of Oklahoma, Appellant,
v.
James ABBOTT, Appellee.
No. O-75-487.
Court of Criminal Appeals of Oklahoma.
January 27, 1976.
Rick Cornwell, Asst. Dist. Atty., Pottawatomie County, for appellant.
Michael P. Warwick, Shawnee, for appellee.
*793 OPINION
BLISS, Judge:
This is an appeal from the District Court, Pottawatomie County, Case No. CRF-74-476, wherein James Abbott, hereinafter referred to as defendant, was charged with the crime of Possession of Stolen Vehicle, in violation of 47 O.S. 1971, § 4-103. After the presentation of the State's evidence the defendant demurred to the evidence which was sustained by the trial court and the court directed the jury to render a verdict in favor of the defendant which was so entered. Prior to the presentation of the State's evidence, the defendant presented an oral motion to exclude certain testimony anticipated to be introduced by the State and such motion was granted with the State giving notice of intent to appeal the trial court's ruling on said motion. From the trial court's order granting the defendant's oral motion to exclude certain testimony, the State now perfects a timely appeal to this court upon a reserved question of law as provided by 22 O.S. 1971, § 1053, ¶ 3.
The question reserved by the State for this Court's review deals with the ruling in the trial court which sustained the defendant's motion to exclude certain evidence which the defendant anticipated the State would seek to introduce which connected the defendant with crimes other than the one charged. The motion was presented orally to the trial court outside the hearing of the jury prior to the presentation of the State's evidence in chief. The defendant requested the court to prohibit the State from introducing testimony to the effect that certain other automobiles, other than the automobile upon which the charge was filed, were found in the possession and on the property of the defendant.
We turn first to the character of the defendant's motion. From the scant record before us we must conclude that the defendant's oral motion was not a motion to suppress predicated upon an illegal search or seizure of the other automobiles, but that the defendant's motion was a motion in limine or preliminary motion to assure the exclusion of evidence which in its nature would be prejudicial to the defendant.
The possible prejudicial nature of the evidence emanates from the defendant's assertion that the specific evidence of other crimes, i.e., possession of additional stolen vehicles other than the vehicle for which the defendant was charged, does not fall within one of the well recognized exceptions which allow the admission of evidence of other crimes, and thus, the evidence should be inadmissible. See, Moulton v. State, Okl.Cr., 476 P.2d 366 (1970).
This Court has implicitly recognized the propriety of the motion in limine as a procedural device in judicial administration. See, Haury v. State, Okl.Cr., 533 P.2d 991 (1975). We also note in Burrus v. Silhavy, Ind. App., 293 N.E.2d 794 (1973) and 63 A.L.R.3d 304:
"A `motion in limine' is a necessary adjunct to the trial court's inherent power to admit and exclude evidence. The trial court may issue protective orders against prejudicial questions or statements which could be uttered before a jury and thereby prevent a fair and impartial jury trial. As stated in Davis, Motions in Limine, 15 Clev. Mar.L.Rev. 255, 256-257 (1966):
"`If prejudicial matters are brought before the jury, no amount of objection or instruction can remove the harmful effect, and the plaintiff is powerless unless *794 he wants to forego his chance of trial and ask for a mistrial. Once the question is asked, the harm is done. Under the harmless error rule many of these matters would probably not be reversible error even though they have a subtle but devastating effect on the plaintiff's case.
"`Perhaps the greatest single advantage to a motion in limine is not having to object in the jury's presence to evidence which is "logically relevant." Jurors cannot be expected to understand why they should not be allowed to consider all evidence which is related to the case, and will usually resent the fact that an objection kept them from hearing it.
"`Another advantage in the use of these motions is to allow the trial judge an opportunity to study the question and the authorities involved. If presented in advance of trial with a brief and with the time to study it, the court will be more inclined to grant the motion.
* * * * * *
"`The power of the trial court to grant such a motion is inherent in its right to admit or exclude evidence and will probably not be specifically mentioned in the procedural rules... .'" (Emphasis original)
Also see, 63 A.L.R.3rd 311 and 89 A.L.R.2d 277.
Recognizing the absence of a specific statute or procedural rule in Oklahoma specifically authorizing the procedural device of a motion in limine, but having implicitly recognized propriety of such a motion, we turn to the specific motion in limine in the instant case. We are of the opinion that the defendant's motion in limine in the instant case was questionably made. Certainly, the significance or importance of such an evidentiary ruling mandates that such a motion be made in writing whereafter if entertained by the trial court the ruling of said trial court will be properly preserved if needed for appellate review. Only the careful drafting and proper argument can provide the trial court with sufficient facts and circumstances upon which to intelligently make an evidentiary ruling. We do not reach the obvious question which must also arise as to whether or not such an evidentiary ruling would be absolute or merely advisory to the parties. We leave the resolution of such an issue to the facts and circumstances of each particular case.
In the instant case the State, as the aggrieved party to the trial court's ruling upon the defendant's motion in limine, bears the burden to preserve an adequate record for appellate review. The record before us fails to reflect any specific offer of proof relating to the facts attendant to the particular evidence the State sought to introduce, but only illustrates the argument by defense counsel and the prosecutor. We do not find the record before us presents sufficient facts upon which we might conclude that the trial court abused its discretion in excluding the certain evidence in question. See, Henderson v. State, Okl.Cr., 385 P.2d 930 (1963). We are left to speculate as to the particular facts and circumstances which would or would not conceivably lend credence to the relevancy and competency of the certain evidence excluded. Therefore, we cannot in good faith promulgate precedent regarding an exception to the rule precluding the admission of evidence of other crime, upon a foundation of speculation. Therefore, for these reasons we do not disturb the trial court's ruling sustaining the defendant's motion in limine.
For all of the foregoing reasons, the trial court's ruling upon the defendant's motion in limine is sustained.
BRETT, P.J., and BUSSEY, J., concur.
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 11-4939
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
KASHUN WATSON,
Defendant - Appellant.
Appeal from the United States District Court for the District of
South Carolina, at Florence. R. Bryan Harwell, District Judge.
(4:10-cr-00941-RBH-9)
Submitted: June 21, 2012 Decided: June 25, 2012
Before GREGORY, SHEDD, and DAVIS, Circuit Judges.
Affirmed by unpublished per curiam opinion.
Carla Faye Grabert-Lowenstein, Conway, South Carolina, for
Appellant. Alfred William Walker Bethea, Jr., Assistant United
States Attorney, Florence, South Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Kashun Watson pled guilty in a Fed. R. Crim. P. 11
hearing to one count of conspiracy to distribute and possess
with intent to distribute 500 grams or more of cocaine and 50
grams or more of cocaine base, in violation of 21 U.S.C. § 846
(2006). He was sentenced to 151 months in prison. In
accordance with Anders v. California, 386 U.S. 738 (1967),
Watson’s attorney has filed a brief certifying that there are no
meritorious issues for appeal but questioning (1) the validity
of Watson’s guilty plea; (2) Watson’s classification as a career
offender; (3) the district court’s refusal to apply a one-to-one
ratio of cocaine to cocaine base; and (4) the reasonableness of
Watson’s sentence. Although informed of his right to do so,
Watson has not filed a pro se supplemental brief. We affirm.
Because Watson did not move to withdraw his plea, we
review his Rule 11 hearing for plain error. United States v.
Martinez, 277 F.3d 517, 525 (4th Cir. 2002). Here, we find no
error, as the district court fully complied with Rule 11 when
accepting Watson’s plea. Given no indication to the contrary,
we therefore find that Watson’s plea was knowing and voluntary,
and, consequently, final and binding. See United States v.
Lambey, 974 F.2d 1389, 1394 (4th Cir. 1992) (en banc).
We review Watson’s sentence for reasonableness, using
an abuse of discretion standard. Gall v. United States, 552
2
U.S. 38, 51 (2007). The first step in this review requires us
to ensure that the district court committed no significant
procedural error. United States v. Evans, 526 F.3d 155, 161
(4th Cir. 2008). Procedural errors include improperly
calculating the Guidelines range, treating the Guidelines as
mandatory, failing to consider the 18 U.S.C. § 3553(a) (2006)
factors, sentencing based on clearly erroneous facts, or failing
to adequately explain the sentence, “including an explanation
for any deviation from the Guidelines range.” Gall, 552 U.S. at
51. Only if we find a sentence procedurally reasonable can we
consider substantive reasonableness. United States v. Carter,
564 F.3d 325, 328 (4th Cir. 2009).
As counsel notes, the district court did not err in
concluding that Watson qualified as a career offender pursuant
to U.S. Sentencing Guidelines Manual (“USSG”) § 4B1.1(a) (2010).
Watson was convicted of the controlled substance offenses
supporting his career offender designation well before the
completion of the conduct supporting his instant conviction.
Accordingly, those offenses properly supported the application
of USSG § 4B1.1(a). See USSG § 4B1.2(c); United States v.
Carter, 300 F.3d 415, 427 (4th Cir. 2002).
Further, the district court did not err in declining
to apply a one-to-one ratio with respect to cocaine and cocaine
base when sentencing Watson. Because Watson’s offense involved
3
a significant quantity of both drugs, the application of such a
ratio would not have affected his sentence, given his career
offender status and the district court’s decision to grant him
the benefit of the statutory amendments of the Fair Sentencing
Act of 2010, Pub. L. No. 111-220. Because Watson’s sentence was
otherwise procedurally and substantively reasonable, we find no
error in its imposition.
In accordance with Anders, we have reviewed the record
and have found no meritorious issues for appeal. We therefore
affirm Watson’s conviction and sentence. This court requires
that counsel inform Watson, in writing, of his right to petition
the Supreme Court of the United States for further review. If
Watson requests that a petition be filed, but counsel believes
that such a petition would be frivolous, counsel may move in
this court for leave to withdraw from representation. Counsel’s
motion must state that a copy thereof was served on Watson. 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.
AFFIRMED
4
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231 U.S. 9 (1913)
LURIA
v.
UNITED STATES.
No. 27.
Supreme Court of United States.
Argued April 23, 1913.
Decided October 20, 1913.
APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK.
*11 Mr. Louis Marshall, with whom Mr. A.M. Friedenberg was on the brief, for appellant.
Mr. Assistant Attorney General Harr for the United States.
*17 MR. JUSTICE VAN DEVANTER delivered the opinion of the court.
This appeal brings under review a decree setting aside and canceling, under § 15 of the act of June 29, 1906, 34 Stat. 596, 601, c. 3592, as fraudulently and illegally procured, a certificate of citizenship theretofore issued to George A. Luria by the court of common pleas of the city and county of New York. 184 Fed. Rep. 643.
The petition was not carefully prepared, and yet it doubtless was designed to charge that the certificate was fraudulently and illegally procured in that Luria did not at the time intend to become a permanent citizen of the United States but only to obtain the indicia of such citizenship in order that he might enjoy its advantages and protection and yet take up and maintain a permanent residence in a foreign country. There was a prayer that the certificate be set aside and canceled because "procured illegally." The sufficiency of the petition was not challenged, and the case was heard and determined as if the issue just described were adequately tendered. In the opinion rendered by the District Court it was said, after observing that the petition was subject to criticism: "That point, however, was not raised, and I suppose the defendant does not mean to raise it." This view of his attitude passed unquestioned then, and it is too late to question it now.
The case was heard upon an agreed statement and some accompanying papers, from all of which it indubitably appeared that Luria was born in Wilna, Russia, in 1865 or 1868 and came to New York in 1888; that he entered a medical college of that city the next year and was graduated therefrom in 1893; that he applied for and procured *18 the certificate of citizenship in July, 1894; that in the following month he sought and obtained a passport from the Department of State, and in November left the United States for the Transvaal, South Africa, arriving there in December; that from that time to the date of the hearing, in December, 1910, he resided and practiced his profession in South Africa; that he joined the South African Medical Association and served in the Boer war; that his only return to the United States was for four or five months in 1907, for the temporary purpose of taking a postgraduate course in a medical school in New York; and that when entering that school he gave as his address, Johannesburg, South Africa. From the facts so appearing the District Court found and held that within a few months after securing the certificate of citizenship Luria went to and took up a permanent residence in South Africa, and that this, under § 15 of the act of 1906, constituted prima facie evidence of a lack of intention on his part to become a permanent citizen of the United States at the time he applied for the certificate. In the papers accompanying the agreed statement there were some declarations which, if separately considered, would tend to engender the belief that he had not taken up a permanent residence in South Africa and was only a temporary sojourner therein, but the District Court, upon weighing and considering those declarations in connection with all the facts disclosed, as was necessary, concluded that the declarations could not be taken at their face value and that the residence in South Africa was intended to be, and was, permanent in character. We concur in that conclusion.
In his answer, Luria interposed the defense that his presence in the Transvaal was solely for the purpose of promoting his health, the implication being that when he went there his health was impaired in such a way that a residence in that country was necessary or advisable *19 and therefore that taking up such residence ought not to be accepted as indicating that when he was naturalized it was not his intention to become a permanent citizen of the United States. He does not appear to have been present at the hearing, and, although there was ample time (ten months after filing his answer) to take his deposition, it was not taken, and there was substantially no attempt to sustain this defense or to explain his permanent removal to the Transvaal so soon after he procured the certificate of citizenship. True, it appeared that in 1909 he filed at the United States Consulate in Johannesburg, in support of an application for registration as a citizen of the United States, two certificates from medical practitioners, stating, in effect, that his residence in the Transvaal was for purposes of health; but those certificates did not rise to the dignity of proof in the present case. Besides being ex parte, they were meagre, not under oath, and not accepted by the consular officers as adequate or satisfactory. Thus, we think the District Court rightly held that there was no countervailing evidence sufficient to overcome the evidential effect of taking up a permanent residence in the Transvaal so shortly following the naturalization.
Section 15 of the act of 1906, under which this suit was conducted, is as follows (34 Stat. 601):
"SEC. 15. That it shall be the duty of the United States district attorneys for the respective districts, upon affidavit showing good cause therefor, to institute proceedings in any court having jurisdiction to naturalize aliens in the judicial district in which the naturalized citizen may reside at the time of bringing the suit, for the purpose of setting aside and canceling the certificate of citizenship on the ground of fraud or on the ground that such certificate of citizenship was illegally procured. In any such proceedings the party holding the certificate of citizenship alleged to have been fraudulently or illegally procured shall have *20 sixty days personal notice in which to make answer to the petition of the United States; and if the holder of such certificate be absent from the United States or from the district in which he last had his residence, such notice shall be given by publication in the manner provided for the service of summons by publication or upon absentees by the laws of the State or the place where such suit is brought.
"If any alien who shall have secured a certificate of citizenship under the provisions of this Act shall, within five years after the issuance of such certificate, return to the country of his nativity, or go to any other foreign country, and take permanent residence therein, it shall be considered prima facie evidence of a lack of intention on the part of such alien to become a permanent citizen of the United States at the time of filing his application for citizenship, and, in the absence of countervailing evidence, it shall be sufficient in the proper proceeding to authorize the cancellation of his certificate of citizenship as fraudulent, and the diplomatic and consular officers of the United States in foreign countries shall from time to time, through the Department of State, furnish the Department of Justice with the names of those within their respective jurisdictions who have such certificates of citizenship and who have taken permanent residence in the country of their nativity, or in any other foreign country, and such statements, duly certified, shall be admissible in evidence in all courts in proceedings to cancel certificates of citizenship.
"Whenever any certificate of citizenship shall be set aside or canceled, as herein provided, the court in which such judgment or decree is rendered shall make an order canceling such certificate of citizenship and shall send a certified copy of such order to the Bureau of Immigration and Naturalization; and in case such certificate was not originally issued by the court making such order it shall direct the clerk of the court to transmit a copy of such order and judgment to the court out of which such certificate *21 of citizenship shall have been originally issued. And it shall thereupon be the duty of the clerk of the court receiving such certified copy of the order and judgment of the court to enter the same of record and to cancel such original certificate of citizenship upon the records and to notify the Bureau of Immigration and Naturalization of such cancellation.
"The provisions of this section shall apply not only to certificates of citizenship issued under the provisions of this act, but to all certificates of citizenship which may have been issued heretofore by any court exercising jurisdiction in naturalization proceedings under prior laws."
One of the questions arising under this section is, whether the second paragraph, dealing with the evidential effect of taking up a permanent residence in a foreign country within five years after securing a certificate of citizenship, is confined to certificates issued under the act of 1906, or applies also to those issued under prior laws, as was Luria's. If that paragraph were alone examined, the answer undoubtedly would be that only certificates under the act of 1906 are included. But the last paragraph also must be considered. It expressly declares that "the provisions of this section" shall apply, not only to certificates issued under the act of 1906, but also to all certificates theretofore issued under prior laws. The words "the provisions of this section" naturally mean every part of it, one paragraph as much as another, and that meaning cannot well be rejected without leaving it uncertain as to what those words embrace. Counsel refer to the Congressional Record, which shows that the second paragraph was inserted by way of amendment while the section was being considered in the House of Representatives. But as the section was in its present form when it was finally adopted by that body, as also when it was adopted by the Senate and approved by the President, it would seem that the last paragraph, in view of its plain and unambiguous *22 language, must be accepted as extending the preceding paragraphs to all certificates, whether issued theretofore under prior laws or thereafter under that act.
But it is said that it was not essential to naturalization under prior laws, Rev. Stat., §§ 2165-2170, that the applicant should intend thereafter to reside in the United States; that, if he otherwise met the statutory requirements, it was no objection that he intended presently to take up a permanent residence in a foreign country; that the act of 1906, differing from prior laws, requires the applicant to declare "that it is his intention to reside permanently within the United States"; and therefore that Congress, when enacting the second paragraph of § 15, must have intended that it should apply to certificates issued under that act and not to those issued under prior laws. It is true that § 4 of the act of 1906 exacts from the applicant a declaration of his intention to reside in the United States, and it is also true that the prior laws did not expressly call for such a declaration. But we think it is not true that under the prior laws it was immaterial whether the applicant intended to reside in this country or presently to take up a permanent residence in a foreign country. On the contrary, by necessary implication, as we think, the prior laws conferred the right to naturalization upon such aliens only as contemplated the continuance of a residence already established in the United States.
Citizenship is membership in a political society and implies a duty of allegiance on the part of the member and a duty of protection on the part of the society. These are reciprocal obligations, one being a compensation for the other. Under our Constitution, a naturalized citizen stands on an equal footing with the native citizen in all respects, save that of eligibility to the Presidency. Minor v. Happersett, 21 Wall. 162, 165; Elk v. Wilkins, 112 U.S. 94, 101; Osborn v. Bank, 9 Wheat. 738, 827. Turning to the naturalization laws preceding the act of 1906, being *23 those under which Luria obtained his certificate, we find that they required, first, that the alien, after coming to this country, should declare on oath, before a court or its clerk, that it was bona fide his intention to become a citizen of the United States and to renounce forever all allegiance and fidelity to any foreign sovereignty; second, that at least two years should elapse between the making of that declaration and his application for admission to citizenship; third, that as a condition to his admission the court should be satisfied, through the testimony of citizens, that he had resided within the United States five years at least, and that during that time he had behaved as a man of good moral character, attached to the principles of the Constitution of the United States, and well disposed to the good order and happiness of the same; and, fourth, that at the time of his admission he should declare on oath that he would support the Constitution of the United States and that he absolutely and entirely renounced and abjured all allegiance and fidelity to every foreign sovereignty. These requirements plainly contemplated that the applicant, if admitted, should be a citizen in fact as well as in name that he should assume and bear the obligations and duties of that status as well as enjoy its rights and privileges. In other words, it was contemplated that his admission should be mutually beneficial to the Government and himself, the proof in respect of his established residence, moral character, and attachment to the principles of the Constitution being exacted because of what they promised for the future, rather than for what they told of the past.
By the clearest implication those laws show that it was not intended that naturalization could be secured thereunder by an alien whose purpose was to escape the duties of his native allegiance without taking upon himself those of citizenship here, or by one whose purpose was to reside permanently in a foreign country and to use his naturalization *24 as a shield against the imposition of duties there, while by his absence he was avoiding his duties here. Naturalization secured with such a purpose was wanting in one of its most essential elements good faith on the part of the applicant. It involved a wrongful use of a beneficent law. True, it was not expressly forbidden; neither was it authorized. But, being contrary to the plain implication of the statute, it was unlawful, for what is clearly implied is as much a part of a law as what is expressed. United States v. Babbit, 1 Black, 55, 61; McHenry v. Alford, 168 U.S. 651, 672; South Carolina v. United States, 199 U.S. 437, 451.
Perceiving nothing in the prior laws which shows that Congress could not have intended that the last paragraph of § 15 of the act of 1906 should be taken according to the natural meaning and import of its words, we think, as before indicated, that it must be regarded as extending the preceding paragraphs of that section to all certificates of naturalization, whether secured theretofore under prior laws or thereafter under that act.
Several contentions questioning the constitutional validity of § 15 are advanced, but all, save the one next to be mentioned, are sufficiently answered by observing that the section makes no discrimination between the rights of naturalized and native citizens, and does not in anywise affect or disturb rights acquired through lawful naturalization, but only provides for the orderly cancellation, after full notice and hearing, of certificates of naturalization which have been procured fraudulently or illegally. It does not make any act fraudulent or illegal that was honest and legal when done, imposes no penalties, and at most provides for the annulment, by appropriate judicial proceedings, of merely colorable letters of citizenship, to which their possessors never were lawfully entitled. Johannessen v. United States, 225 U.S. 227. See also Wallace v. Adams, 204 U.S. 415.
*25 Objection is specially directed to the provision which declares that taking up a permanent residence in a foreign country within five years after the issuance of the certificate shall be considered prima facie evidence of a lack of intention to become a permanent citizen of the United States at the time of the application for citizenship, and that in the absence of countervailing evidence the same shall be sufficient to warrant the cancellation of the certificate as fraudulent. It will be observed that this provision prescribes a rule of evidence, not of substantive right. It goes no farther than to establish a rebuttable presumption which the possessor of the certificate is free to overcome. If, in truth, it was his intention at the time of his application to reside permanently in the United States, and his subsequent residence in a foreign country was prompted by considerations which were consistent with that intention, he is at liberty to show it. Not only so, but these are matters of which he possesses full, if not special, knowledge. The controlling rule respecting the power of the legislature in establishing such presumptions is comprehensively stated in Mobile &c. Railroad Co. v. Turnipseed, 219 U.S. 35, 42, 43, as follows:
"Legislation providing that proof of one fact shall constitute prima facie evidence of the main fact in issue, is but to enact a rule of evidence, and quite within the general power of government. Statutes, national and state, dealing with such methods of proof in both civil and criminal cases abound, and the decisions upholding them are numerous. . . .
"That a legislative presumption of one fact from evidence of another may not constitute a denial of due process of law or a denial of the equal protection of the law it is only essential that there shall be some rational connection between the fact proved and the ultimate fact presumed, and that the inference of one fact from proof of another shall not be so unreasonable as to be a purely arbitrary *26 mandate. So, also, it must not, under guise of regulating the presentation of evidence, operate to preclude the party from the right to present his defense to the main fact thus presumed.
"If a legislative provision not unreasonable in itself prescribing a rule of evidence, in either criminal or civil cases, does not shut out from the party affected a reasonable opportunity to submit to the jury in his defense all of the facts bearing upon the issue, there is no ground for holding that due process of law has been denied him."
Of like import are Fong Yue Ting v. United States, 149 U.S. 698, 729; Adams v. New York, 192 U.S. 585, 599; Bailey v. Alabama, 219 U.S. 219, 238; Lindsley v. Natural Carbonic Gas Co., 220 U.S. 61, 81; Reitler v. Harris, 223 U.S. 437, 441.
Nor is it a valid objection to such legislation that it is made applicable to existing causes of action, as is the case here, the true rule in that regard being well stated in Cooley's Constitutional Limitations, 7th ed. 524, in these words:
"It must also be evident that a right to have one's controversies determined by existing rules of evidence is not a vested right. These rules pertain to the remedies which the State provides for its citizens; and generally in legal contemplation they neither enter into and constitute a part of any contract, nor can be regarded as being of the essence of any right which a party may seek to enforce. Like other rules affecting the remedy, they must therefore at all times be subject to modification and control by the legislature; and the changes which are enacted may lawfully be made applicable to existing causes of action, even in those States in which retrospective laws are forbidden. For the law as changed would only prescribe rules for presenting the evidence in legal controversies in the future; and it could not therefore be called retrospective *27 even though some of the controversies upon which it may act were in progress before."
This court applied that rule in Webb v. Den, 17 How. 576, 578; Hopt v. Utah, 110 U.S. 574, 590; Thompson v. Missouri, 171 U.S. 380; and Reitler v. Harris, supra.
That the taking up of a permanent residence in a foreign country shortly following naturalization has a bearing upon the purpose with which the latter was sought and affords some reason for presuming that there was an absence of intention at the time to reside permanently in the United States is not debatable. No doubt, the reason for the presumption lessens as the period of time between the two events is lengthened. But it is difficult to say at what point the reason so far disappears as to afford no reasonable basis for the presumption. Congress has indicated its opinion that the intervening period may be as much as five years without rendering the presumption baseless. That period seems long, and yet we are not prepared to pronounce it certainly excessive or unreasonable. But we are of opinion that as the intervening time approaches five years the presumption necessarily must weaken to such a degree as to require but slight counter, vailing evidence to overcome it. On the other hand, when the intervening time is so short as it is shown to have been in the present case, the presumption cannot be regarded as yielding to anything short of a substantial and convincing explanation. So construed, we think the provision is not in excess of the power of Congress.
Lastly it is urged that the District Court erred in not according to the defendant a trial by jury. The claim is predicated upon the Seventh Amendment to the Constitution, which declares that "in suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved." This, however, was not a suit at common law. The right asserted and the remedy sought were essentially equitable, *28 not legal, and this, according to the prescribed tests, made it a suit in equity. Parsons v. Bedford, 3 Pet. 433, 447; Irvine v. Marshall, 20 How. 558, 565; Root v. Railway Company, 105 U.S. 189, 207. In this respect it does not differ from a suit to cancel a patent for public land or letters patent for an invention. See United States v. Stone, 2 Wall. 525; United States v. San Jacinto Tin Co., 125 U.S. 273; United States v. Bell Telephone Co., 128 U.S. 315.
Finding no error in the record, the decree is
Affirmed.
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268 Pa. Superior Ct. 269 (1979)
407 A.2d 1350
COMMONWEALTH of Pennsylvania
v.
Frederick E. MORRIS, Appellant.
Superior Court of Pennsylvania.
Submitted December 8, 1978.
Decided July 27, 1979.
Ronold J. Karasek, Bangor, for appellant.
Michael Vedomsky, Assistant District Attorney, Bangor, for Commonwealth, appellee.
*270 Before PRICE, SPAETH and WATKINS, JJ.
WATKINS, Judge:
This is an appeal from the judgment of sentence of the Court of Common Pleas of Northampton County, Criminal Division, finding appellant guilty of the summary offense of racing on the highways. Act of 1976, June 17, P.L. 162, No. 81, Sec. 3367, 75 P.C.S.A. § 3367.
It appears the appellant and another person pulled out of a gas station at about the same time, wheels spinning on the gravel, travelled a short distance and pulled into a diner, all of which was observed from an adjoining parking lot by the arresting officer. A citation was issued in which no speed was indicated.
Appellant moved for dismissal of the complaint but the motion was refused. Appellant contends that the complaint was fatally defective because it failed to specify speed as required by § 3366 of the Act, supra.
§ 3366 states:
"In every charge of violation of a speed provision in this subchapter, except for a violation of Section 3361 (relating to driving vehicles at safe speed), the citation or complaint shall specify the speed at which the Defendant is alleged to have driven and the applicable speed limit."
§ 3367 (the charge involved) clearly states:
"No person shall drive a vehicle on a highway in any race, speed, competition or contest, drag race or acceleration contest, test of physical endurance, exhibition of speed or acceleration or for the purpose of making a speed record, and no person shall in any manner participate in any such race, competition, contest, test or exhibition."
Sections 3366 and 3367 are both a part of the subchapter F of the code. The language of Section 3366 is clear and unambiguous and mandatory. To say that § 3367(b) is not a speed provision of the act is to blind oneself to its language and should the Legislature have intended to exempt it from the mandate of § 3366 it would have done so as it did with § 3361.
*271 An allegation as to speed was required in the complaint and was not there.
Judgment reversed and the appellant discharged.
PRICE, J., files a dissenting statement.
PRICE, Judge, dissenting:
I do not believe that Section 3367[1] is a speed provision of the subchapter, and therefore the complaint under Section 3367(b)[2] is proper as drawn.
I would affirm the judgment.
NOTES
[1] Act of June 17, 1976, P.L. 162, No. 81, Sec. 3367, 75 Pa.C.S. § 3367.
[2] 75 Pa.C.S. § 3367(b) provides:
"No person shall drive a vehicle on a highway in any race, speed competition or contest, drag race or acceleration contest, test of physical endurance, exhibition of speed or acceleration, or for the purpose of making a speed record, and no person shall in any manner participate in any such race, competition, contest, test or exhibition."
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FILED
United States Court of Appeals
Tenth Circuit
PUBLISH June 18, 2014
Elisabeth A. Shumaker
UNITED STATES COURT OF APPEALS Clerk of Court
TENTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff - Appellant,
v. No. 13-1474
CHESTON JEROME FOSTER,
Defendant - Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
(D.C. No. 1:13-CR-00062-CMA-1)
William A. Glaser, Attorney, Appellate Section, Criminal Division, United States
Department of Justice, Washington, D.C. (John F. Walsh, United States Attorney; Robert
M. Russel, Chief, Appellate Section, Office of United States Attorney, District of
Colorado, with him on the briefs; Mythili Raman, Acting Assistant Attorney General and
Denis M. McInerney, Deputy Assistant Attorney General, with him on the opening brief;
David A. O’Neil, Acting Assistant Attorney General and David M. Bitkower, Deputy
Assistant Attorney General, with him on the reply brief), for Plaintiff-Appellant.
Madeline S. Cohen, Assistant Federal Public Defender (Virginia L. Grady, Interim
Federal Public Defender, with her on the brief), Denver, Colorado, for Defendant-
Appellee.
Before BRISCOE, Chief Judge, MURPHY and MATHESON, Circuit Judges.
BRISCOE, Chief Judge.
The sole issue in this case is whether Cheston Jerome Foster escaped from custody
when he left a residential reentry center where he was ordered to reside as a condition of
his supervised release. Foster was subsequently charged with one count of escape from
custody, in violation of 18 U.S.C. § 751(a). The district court dismissed the indictment
after concluding that Foster was not in custody. The government appeals. We exercise
jurisdiction under 18 U.S.C. § 3731 and reverse and remand.
I. BACKGROUND
In 2012, Foster was arrested for violating the terms of his supervised release,
including traveling to Massachusetts without permission. Following a revocation hearing
on October 30, 2012, where Foster admitted the violations enumerated, the district court
revoked his supervised release and sentenced Foster to time served and 30 months of
supervised release. The probation officer asked the district court to add “an additional
condition of supervision that may be relevant.” App’x at 142. The probation officer
stated:
I am not sure what his residential circumstances are. He is
presently in custody. He has spoken – he has talked about a
desire to go to a different district. His employment is not sure
at this point, so I would recommend the Court impose a six-
month halfway house placement so that we could rectify the
stability issue. You know, he could be let out of the halfway
house early when the stability is in place.
Id. The court agreed and told Foster, “I will impose a special condition that you reside in
a halfway house residential re-entry center, however you want to word it, for a period of
up to six months.” Id. Foster’s attorney sought an alternative arrangement by providing
2
the probation office with the address of Foster’s mother, but the probation officer opposed
this suggestion. The district court stated, “[w]hat we will do is we will start with a
residential re-entry center, and if through his assigned probation officer there is an
alternative that is reasonable, we will go at it that way, but we will start there.” Id. at 143.
The court issued a written judgment on November 6, 2012, that included the conditions of
Foster’s new term of supervised release. It listed as an “additional condition[] of
supervision,” that “[t]he defendant shall reside in a resident [sic] reentry center (RRC) for
a period of up to 6 months, to commence upon release of imprisonment, and shall observe
the rules of that facility.” Id. at 32.
On December 27, 2012, Foster left the residential reentry center without
permission and did not return. On February 12, 2013, a grand jury issued an indictment
charging Foster with a single count of escape from custody, in violation of 18 U.S.C. §
751(a).1 Foster’s attorney moved to dismiss the indictment because the residence
requirement “was not part of any detention or a sanction for his supervised release
violation,” and therefore Foster was not in custody for purposes of the escape statute. Id.
at 44.
1
The indictment charged that on December 27, 2012, Foster “intentionally and
unlawfully escaped from custody at the Independence House South,” where “the
defendant was lawfully confined at the direction of United States District Senior Judge
Lewis T. Babcock for violation of supervised release by an order dated October 30,
2012.” App’x at 38-39. The indictment also stated Foster was confined there “by virtue
of a judgment and commitment by a United States District Court following the
defendant’s conviction for a felony offense.” Id.
3
The district court granted Foster’s motion to dismiss.2 The district court stated that
“to endorse the government’s reasoning turns a remedy used by Judge Babcock to
provide a homeless man a stable place to live upon his release from custody into a means
to return him to prison with a second felony conviction, one which carries with it a
statutory penalty of up to five more years of incarceration.” Id. at 83. The district court
highlighted “three distinct issues related to” the use of the term custody in § 751(a): “(1)
the extent and scope of restraints on liberty necessary to constitute ‘custody’ for purposes
of § 751(a); (2) whether someone other than the Attorney General (or his representative)
can be a ‘custodian’ of a person charged with escaping custody; and (3) whether the
underlying purpose of a restraint on liberty is custodial.” Id. at 85. The court noted that
the third issue was “unresolved in this circuit” but had been decided by the Ninth Circuit
in United States v. Burke, 694 F.3d 1062 (9th Cir. 2012). Id. The district court held that
“the Burke court’s reasoning is not contrary to Tenth Circuit precedent and informs this
Court’s conclusion that a stop-gap measure used to prevent homelessness for a recently-
released prisoner on supervised release does not constitute a custodial sentence triggering
criminal liability under § 751(a).” Id. After reviewing relevant Ninth and Tenth Circuit
cases, the district court decided that “what constitutes ‘custody’ under § 751(a) is not the
level of restraint; rather, it is the underlying purpose of that restraint.” Id. at 91 (emphasis
2
District Court Judge Lewis Babcock, who had presided over the revocation of
Foster’s supervised release, recused himself from hearing the criminal case charging a
violation of 18 U.S.C. § 751(a). See Supp. App’x.
4
in original). The district court based this conclusion on the history of the Federal Escape
Act, the purpose of supervised release, and the goals of the Sentencing Reform Act. Id. at
91-98.
The district court also found it persuasive that “Judge Babcock could have both
revoked the term of supervised release and imposed a new custodial sentence beyond
what Mr. Foster had already served.” Id. at 99. Had he done so, “and, if Mr. Foster had
unlawfully absented himself from this confinement, then Mr. Foster could have been
prosecuted under § 751(a).” Id. Instead, “Judge Babcock deemed that a custodial
sentence of ‘time served’ was sufficient and that Mr. Foster should begin his term of
supervised release, albeit with an initial transitory period in a halfway house.” Id.
Although this placed restrictions on Mr. Foster’s liberty, the district court found that “this
term was ‘by no means, by letter or in spirit, a custodial order of the Court.’” Id. (quoting
Burke, 694 F.3d at 1063).
II. ANALYSIS
The government argues that Foster was in “custody” when housed at the
residential reentry center pursuant to the district court’s order, and that the district court
erred in dismissing the indictment charging him with escape under 18 U.S.C. § 751(a).
We review de novo the legal interpretation of “custody” as set forth in § 751(a). United
States v. Ko, 739 F.3d 558, 560 (10th Cir. 2014). The federal escape statute, 18 U.S.C. §
751(a), states:
Whoever escapes or attempts to escape from the custody of
5
the Attorney General or his authorized representative, or from
any institution or facility in which he is confined by direction
of the Attorney General, or from any custody under or by
virtue of any process issued under the laws of the United
States by any court, judge, or magistrate judge, or from the
custody of an officer or employee of the United States
pursuant to lawful arrest, shall, if the custody or confinement
is by virtue of an arrest on a charge of felony, or conviction of
any offense, be fined under this title or imprisoned not more
than five years . . . .
18 U.S.C. § 751(a) (emphasis added).
The government argues that Foster escaped from custody when he left the reentry
center. The government points out that custody under § 751(a) does not have to be
physical but may be minimal or constructive, and because the statute applies to “any
custody,” it is not restricted to only punitive custody, or any other limitation of the term.
The government therefore argues that “the plain meaning of the word indicates that a
person is in custody under the escape statute if another person has the legal right to
control his actions or limit his freedom.” Appellant’s Br. at 11. The government also
contends the district court’s reliance on “the ‘underlying purpose’ of the restraint [to]
determine[] whether a person is in custody” is misplaced. Id. at 22 (quoting App’x at 91).
The government contends that the district court misread Burke because the Ninth Circuit
did not rely on the purpose of the restraint but instead rested its ruling on the extent of the
restraint imposed upon Burke as a resident of the halfway house.
We agree with the government’s interpretation of § 751(a), which is supported by
our prior precedent. As regards the extent and scope of restraint necessary to constitute
6
custody under § 751(a), we stated in Depew v. United States: “‘Custody,’ as used in the
escape statute, does not require direct physical restraint. Custody may be minimal and,
indeed, may be constructive.” 977 F.2d 1412, 1414 (10th Cir. 1992) (internal citations
omitted). Although Depew dealt with the separate issue of whether the defendant was in
federal or state custody when he was being transferred to county jail pursuant to a writ of
habeas corpus ad prosequendum, we have previously emphasized that Depew’s “holding”
includes the statement that “custody may be minimal or even constructive.” United States
v. Sack, 379 F.3d 1177, 1181 (10th Cir. 2004); see also Ko, 739 F.3d at 562 n.1 (“Mr. Ko
characterizes these statements [regarding minimal and constructive custody] from Depew
as dicta, yet in Sack we repeatedly referred to these statements as ‘our holding’ from
Depew.”).
In Sack, we determined that escape charges are not limited to defendants who were
previously in the custody of the Attorney General — a court-ordered placement in a
halfway house, if violated, can also result in an escape charge. The district court had
ordered Courtney Sack to reside at a halfway house as a condition of his pretrial release.
Sack, 379 F.3d at 1178. When he left the halfway house without permission, he was
charged with escape under § 751(a). Sack argued he did not violate § 751(a) because he
was not in the custody of the Attorney General. Before resolving this question, we first
discussed prior cases that addressed custody in the context of placement at a halfway
house. Id. at 1179. One of these cases was United States v. Swanson, 253 F.3d 1220,
1223-24 (10th Cir. 2001), where we held that court-ordered residence at a halfway house
7
constituted “custody” under U.S.S.G. § 3C1.1, Note 4(e). In a footnote in Sack, we
acknowledged that although Swanson did not interpret § 751(a), “it deserves mention that
Swanson was not concerned with the identity of the custodian, but whether the nature of
residence at a halfway house was sufficiently restrictive to constitute custody.” Id. at
1179 n.1. We then stated that Depew’s holding “that custody may be minimal or
constructive[] suggests that the restrictions of life at a halfway house are sufficiently
limiting so as to constitute custody for the purposes of § 751.” Id. In the main text of the
opinion, we stated: “Because Sack was in the custody of the halfway house as a result of
an order of the district court, we conclude he was in custody under § 751.” Id. at 1179.
Ko provides further support for our conclusion that “real physical confinement” is
not a necessary predicate for escape. Ko involved a defendant who was transferred by the
Bureau of Prisons (“BOP”) to his home to complete the remaining few months of his
sentence. 739 F.3d at 559. Although Ko was allowed to leave his home for work, he was
also required to return every evening. Id. When his electronic monitoring bracelet
indicated he had not returned home as required and he could not be located, Ko was
charged with escape under § 751(a). Id. at 559-60. Ko moved to dismiss the indictment,
arguing he was not in custody, and the district court granted the motion. Id. at 560. On
appeal, Ko argued that custody under § 751 required “‘real physical confinement’ that
does not suggest ‘leaving one’s own home.’” Id. We rejected this argument, stating that
“‘custody’ does not necessarily require an element of physical restraint” but instead
“anyone under ‘immediate charge and control . . . exercised by a person or an authority’
8
may be said to be in ‘custody.’” Id.
In Ko, after concluding that the rule of lenity did not apply, we discussed Sack and
Depew:
In Sack . . . [w]e concluded that, although a halfway house
entails fewer restrictions than prison, “the restrictions of life
at a halfway house are sufficiently limiting so as to constitute
custody for the purposes of § 751.” Sack, 379 F.3d at 1179
n.1. In so holding, this court referenced only one
restriction–the inability “to come and go at will.” Id. (quoting
United States v. Swanson, 253 F.3d 1220, 1224 (10th Cir.
2001)). Likewise, this court in United States v. Depew,
concluded that a federal prisoner, who was in transit between
two state facilities on a writ of habeas corpus ad
prosequendum, was in § 751 custody. 977 F.2d 1412, 1414
(10th Cir. 1992). We held that § 751 custody “does not
require direct physical restraint.” Id. In fact, § 751 custody
“may be minimal and, indeed, may be constructive.” Id.
Id. at 561-62. We then analogized home confinement to residence in a halfway house:
Home confinement is analogous to custody in a halfway
house. Like a prisoner in a halfway house, Mr. Ko was not
free to come and go as he pleased–his confinement required
him to remain in his home from 7:00 p.m. each night until he
was permitted to go to work the following morning. . . . Mr.
Ko argues that by “[b]eing allowed to live in the comfort of
[his] own home and to be away for work or other approved
activities,” he was not subject to a “quantum of restraint”
necessary for “custody.” However comfortable Mr. Ko may
have found the arrangement, the BOP did not intend it to be
anything less than an extension of his imprisonment. In Mr.
Ko’s case, imprisonment entailed constant monitoring, a
monitoring bracelet, and spatial and temporal bounds. In that
way, the restrictions on his life in home confinement were
sufficiently limiting so as to constitute custody under § 751.
Id. at 562 (citations omitted). Given our prior precedent in Depew, Sack, Swanson, and
9
Ko, we easily conclude that court-ordered residence at a halfway house is sufficiently
restrictive to constitute custody.
We also reject Foster’s reliance on Burke as authority for our considering a
sentencing court’s underlying purpose for halfway house placement when determining
whether an individual is in “custody” under § 751(a). Both Foster and the district court
misread Burke. Burke does not stand for the proposition courts are to look to the
underlying purpose of the restraint when determining whether an individual is in
“custody” under § 751(a). In Burke, the Ninth Circuit focused only on whether Burke’s
freedom was sufficiently restricted to constitute custody, looking to the fact that “the
conditions of his release ‘were much more analogous to probation than they were to
imprisonment.’” 694 F.3d at 1064 (quoting Baxley, 982 F.2d at 1269). There is no
indication that the Ninth Circuit found the district court’s intent to help Burke was at all
relevant.
However, none of our prior cases have had occasion to consider whether the level
of restriction alone determines whether a defendant is in custody, or whether we must
also consider the purpose behind the sentencing court’s placement. Foster provides two
arguments for why the purpose of confinement is relevant when determining whether a
defendant is in custody. First, he argues that court orders that address the placement of a
defendant are not inherently custodial, and without a limiting principle, the meaning of
“custody” within § 751(a) would be unconstitutionally vague. Second, Foster argues that
the meaning of “custody” is ambiguous and thus the rule of lenity should apply. Because
10
the district court here found the placement in the halfway house was not intended to be
custodial, but instead was “a stop-gap measure used to prevent homelessness,” Foster
argues that notwithstanding that his placement in the reentry center was a condition of his
release, he was not in custody. Appellee’s Br. at 17-18 (quoting App’x at 85).3
Foster’s first argument is that interpreting “custody” to include all instances of
court-ordered residential placement during supervised release would render the statute
unconstitutionally vague. He prefaces this argument with his contention that unlike the
other categories of custody in § 751(a), court orders do not create inherently custodial
relationships. Foster argues the Attorney General can “control a person’s residence only
3
Curiously, Foster does not raise many of the theories the district court found
persuasive, such as the history of the Federal Escape Act, the purpose of supervised
release, and the purposes of the Sentencing Reform Act, to conclude that supervised
release can never constitute “custody” under § 751(a). The district court’s reasoning
ignores, however, the plain language of § 751(a), which evinces a broad scope. See 18
U.S.C. § 751(a) (“any custody . . . by virtue of any process . . . by any court” (emphasis
added)). Limiting court-ordered custody to exclude defendants on supervised release
does not support this legislative intent, nor does that limitation have any basis in the text
of § 751(a). As the government notes, pretrial detention also serves a non-punitive
function and does not serve as “a substitute for part of a prison sentence,” and yet can be
“custody” under § 751(a). App’x at 93 (emphasis in original). The district court’s
statement that the commencement of supervised release means the defendant “is no
longer serving a sentence with the BOP,” and thus has been released from the BOP’s
custody, does not advance our analysis. Id. at 94. The question is not whether Foster was
in the BOP’s custody but rather whether he was in custody by virtue of the district court’s
order. Nor is the question whether all defendants on supervised release are in custody
regardless of the terms of their release, but rather whether Foster was in custody because
of the residence requirement in the district court’s order. Even though Foster’s placement
in the reentry center may have had a rehabilitative purpose, that does not limit § 751(a)’s
broad scope because restrictions on liberty can also provide needed support while a
defendant transitions back into the community.
11
when that person is in the Attorney General’s ‘custody,’” and arrest by a federal agent
“necessarily places the individual in the agent’s ‘custody,’” and thus custody in these
instances “does not turn on the particular location from which the individual escapes or
the extent of physical restraint to which he is subject.” Appellee’s Br. at 14-15. Instead,
Foster contends that custody “arises by virtue of the inherently custodial relationship
between the individual and the government.” Id. at 15.
According to Foster, given the broad discretion courts have in setting the terms of
supervised release, the government’s reading of § 751(a) would mean that “any time a
defendant on supervised release is assigned to live in a particular place – whether a
halfway house, his parents’ residence, his last known residence, or even a particular town
or district – he will be subject to . . . § 751(a), with a potential five-year statutory
maximum sentence.” Id. at 15-16. Foster argues that this reading of the statute is so
broad as to provide no clear understanding of what conduct it prohibits, resulting in an
unconstitutionally vague statute. Foster also points out that such a sweeping
interpretation of custody in the context of supervised release would allow “arbitrary and
discriminatory enforcement,” with some prosecutors treating absconding from a
residential placement as a separate crime, while others would be content to treat it merely
as a grounds for revocation of supervised release. Id. at 16.
Foster’s void-for-vagueness arguments are not persuasive. He provides no
alternative definition of “custody” but rather he agrees with the government’s contention
that it is “the legal right to control [the individual’s] actions or limit his freedom.”
12
Appellee’s Br. at 13 (quoting Appellant’s Br. at 10-11). There is nothing in this
definition to indicate that the reason for placing controls upon a person is relevant. See
also Ko, 739 F.3d at 560 (“[A]nyone under ‘immediate charge and control . . . exercised
by a person or an authority’ may be said to be in ‘custody.’”) (quoting Webster’s 9th New
Collegiate Dictionary 318 (1991)). The only pertinent question is whether the district
court’s order did, in fact, give the court control sufficient to constitute custody.
Regardless of why the district court ordered Foster to reside at the halfway house, its
order “unquestionably curtailed Foster’s freedom,” as the government states. Appellant’s
Reply Br. at 8.
As applied to Foster, § 751(a) is not unconstitutionally vague. “The Supreme
Court has told us (repeatedly) that the relevant question in void for vagueness challenges
is merely whether the defendant before us ‘had fair notice from the language’ of the law
‘that the particular conduct which he engaged in was punishable.’” United States v.
Baldwin, 745 F.3d 1027, 1031-32 (10th Cir. 2014) (quoting Parker v. Levy, 417 U.S. 733,
755 (1974)). The statute speaks of “any custody under or by virtue of any process issued
under the laws of the United States by any court.” 18 U.S.C. § 751(a). Foster was
ordered by the district court to reside at the reentry center as a condition of supervised
release. Foster knew where he was to reside, and for what period, and that he was not
allowed to leave without prior approval. Under these facts, Foster had fair notice his
absconding from the reentry center would constitute escape under § 751(a).
Foster also argues § 751(a) is void for vagueness because “some federal
13
prosecutors may treat a defendant’s absconding under such circumstances merely as a
violation of supervised release, while others will pursue indictment under § 751(a).”
Appellee’s Br. at 16. But as the government points out, the standard is not whether the
prosecutor has discretion but whether the law “impermissibly delegates basic policy
matters to policemen, judges, and juries for resolution on an ad hoc and subjective basis,
with the attendant dangers of arbitrary and discriminatory application.” Buscho v.
Shurtleff, 729 F.3d 1294, 1308 (10th Cir. 2013) (quoting Grayned v. City of Rockford,
408 U.S. 104, 108-09 (1972)). We agree that a prosecutor exercises prosecutorial
discretion in determining whether to file charges against some individuals but not others,
even when the individuals in question committed sufficiently similar conduct. But under
§ 751(a), once the prosecutor files charges, there is an “explicit standard[]” for
determining whether the defendant is guilty of the charge. See id. The standard for
whether the defendant was in custody turns on the degree of restriction place upon him.
The application of this standard does not involve such wide discretion as to violate due
process. Cf. United States v. Hunter, 663 F.3d 1136, 1141-42 (10th Cir. 2011) (holding
that term “reasonable and prudent” in state statute regarding driving was not
unconstitutionally vague). In contrast, as the government points out, were we to apply
Foster’s interpretation, we would inject substantial uncertainty into whether a charge
under § 751(a) could be brought because it would require delving into the district court’s
subjective intent to determine the court’s purpose for ordering the residential placement.
Foster also argues that a purpose-focused definition of custody is required by the
14
rule of lenity. He acknowledges that “‘the rule of lenity only applies if, after considering
text, structure, history, and purpose, there remains a grievous ambiguity or uncertainty in
the statute, such that the Court must simply guess as to what Congress intended.’”
Appellee’s Br. at 22 (quoting Barber v. Thomas, 560 U.S. 474, 488 (2010)). Foster’s
only argument, however, is that “any ambiguity about whether” a court order placing a
supervisee in a halfway house would “constitute ‘custody’ . . . must be resolved in Mr.
Foster’s favor.” Id. at 23. But any ambiguity does not rise to the level of a grievous
ambiguity or uncertainty. Further, we find no ambiguity in the statute that would cause
us to limit its scope by looking first to the court’s intended purpose for the custodial
placement. The statute includes “any custody,” which encapsulates all court orders that
place the defendant under sufficient restrictions to constitute custody under our precedent,
regardless of the district court’s underlying purpose in ordering the placement.
Foster contends that Sack, Burke, and United States v. Edelman, 726 F.3d 305 (2d
Cir. 2013), can all be reconciled because we should differentiate between orders that
“were aimed at helping the defendants” and those that “were aimed at curtailing the
defendants’ freedom.” Appellee’s Br. at 22 (emphasis in original). He argues Sack and
Edelman both involved custodial orders because both defendants were ordered to live in a
halfway house after violating terms of their supervised release by using drugs. This is in
direct contrast, Foster argues, to his case and Burke, where the reason the defendant was
placed in the halfway house was to provide “‘a transition from custody to the community
in a way that enables him to make a smooth transition, since he is essentially homeless.’”
15
Id. at 20-21 (quoting Burke, 694 F.3d at 1063).
Not only do we doubt that this distinction is accurate as a factual matter, but also,
and perhaps most importantly, an intent to help a defendant is not necessarily inconsistent
with an intent to restrict his freedom. Foster appears to imply that “intent to restrain” can
be inferred only when the reason for the halfway house placement is vaguely punitive,
and thus is in contrast to orders meant to aid the defendant by providing a place to live.
However, we note that the general goal of supervised release is to assist the defendant,
and that objective does not preclude restrictions on the defendant’s freedom in order to
provide sufficient structure and thereby increase the defendant’s chance for a successful
reentry into the community.
We therefore REVERSE the district court’s order dismissing the indictment
against Foster and REMAND for further proceedings consistent with this opinion.
16
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THE THIRTEENTH COURT OF APPEALS
13-12-00568-CV
CARMEN CANTU
v.
MISSION REGIONAL MEDICAL CENTER, ET AL.
On Appeal from the
of Hidalgo County, Texas
Trial Cause No. C-3647-10-I
JUDGMENT
THE THIRTEENTH COURT OF APPEALS, having considered this cause on
appeal, concludes that the judgment of the trial court should be affirmed. The Court
orders the judgment of the trial court AFFIRMED. Costs of the appeal are adjudged
against appellant.
We further order this decision certified below for observance.
May 8, 2014
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27 A.3d 311 (2011)
COMM. OF PA, DEPT. OF TRANS., BUREAU OF DRIVER LIC.
v.
ATWELL.
No. 2474CD10.
Commonwealth Court of Pennsylvania.
August 15, 2011.
DECISION WITHOUT PUBLISHED OPINION
Reversed.
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143 F.Supp.2d 918 (2001)
John Peter MacDONALD, et al., Plaintiffs,
v.
NAVISTAR INTERNATIONAL TRANSPORTATION CORP., et al., Defendants.
No. C-3-99-280.
United States District Court, S.D. Ohio, Western Division.
March 9, 2001.
*919 *920 *921 Thomas D. Robenalt, Cleveland, OH, for plaintiffs.
Kelly Carbetta Scandy, Douglas W. Rennie, Montgomery Rennie & Jonson, Cincinnati, OH, Laurie J. Nicholson, Cincinnati, OH, Bruce M. Allman, Cincinnati, OH, for defendants.
RICE, Chief Judge.
The instant litigation stems from an automobile accident in Alberta, Canada.[1] On June 17, 1997, Plaintiff John Peter MacDonald ("MacDonald") was delivering furniture for his employer, Bennett's Furniture Galleries, Ltd. ("Bennett's"), using a 1995 International 4000 series truck, VIN # 1HTSCAAM5SH681335. While MacDonald was standing behind the truck, which was parked and stationary, the truck's brake suddenly failed, and the truck began to roll down the road at a high rate of speed. Plaintiff suffered permanent injuries, including broken vertebrae and paralysis.
On June 16, 1999, Plaintiffs MacDonald and the Workers' Compensation Board of Alberta ("WCB")[2] initiated this litigation against Navistar International Transportation Corporation and other various John Doe Defendants (Doc. # 1). They set forth three causes of action, to wit: 1) state law negligent and strict liability products liability claims, based on defective creation, manufacture, design, promotion, marketing, distribution and supply of the vehicle, and failure to provide reasonable warnings or instructions; 2) a state law claim of breach of the implied warranties of fitness and merchantability; and 3) a state law claim of misrepresentation. Plaintiffs further alleged that Defendants acted with malice, thus entitling them to punitive damages. On February 10, 2000, Plaintiffs amended their Complaint, naming Ryder Truck Rental Canada ("Ryder Canada" or "Defendant"); Ryder System, Inc.; Ryder Truck Rental, Inc., dba Ryder Transportation Services; Ryder TRS, Inc.; Ryder Truck Rental, L.T.; Ryder Truck Rental I, L.P.; Ryder Truck Rental II, L.P; Ryder Truck Rental *922 I, L.L.C.; Ryder Truck Rental II, L.L.C.; and Ryder Truck Rental III, L.L.C., as Defendants (Doc. # 13). On July 5, 2000, Plaintiffs voluntarily dismissed, without prejudice, all of the Ryder Defendants, with the exception of Ryder Canada (Doc. # 21).[3]
Pending before the Court is the Motion of Ryder Canada to Dismiss, for lack of personal jurisdiction, pursuant to Fed. R.Civ.P. 12(b)(2) (Doc. # 24). For the reasons assigned, that Motion is SUSTAINED.
In its Motion, Ryder Canada contends that this Court lacks personal jurisdiction over it, because it is a foreign defendant and the exercise of such jurisdiction would violate due process. In support of its argument, the company asserts that it lacks any significant contacts with Ohio. According to Fintan Mealia, the Customer Development Manager for Ryder Canada, Ryder Canada and Bennett's Furniture Gallery entered into a Truck Lease and Service Agreement, dated June 10, 1994 (Def.'s Ex. ¶ 1-2). To supply Bennett's with a truck, on July 11, 1994, Ryder Canada ordered a 1995 International 4000 series truck, VIN # 1HTSCAAM5SH681335, from Navistar International Transportation Company, located in Ontario, Canada (id. ¶ 4). Ryder Canada received the truck from Navistar in December of 1994, and delivered the truck to Bennett's on January 19, 1995 (id. ¶ 5). All service on the vehicle occurred in Alberta, Canada (id. ¶ 7). Mr. Mealia further indicates that Ryder Canada is not licensed to do business in the State of Ohio, does not transact business in Ohio, and has no business contacts with Ohio (id. ¶¶ 8-9). Based upon this evidence, Ryder Canada contends that the Court may not exercise personal jurisdiction over it.
When considering a motion to dismiss for lack of in personam jurisdiction prior to trial, the court can determine the motion on the basis of affidavits alone or by conducting an evidentiary hearing. Serras v. First Tennessee Bank Nat'l Ass'n, 875 F.2d 1212, 1214 (6th Cir.1989). Furthermore, the court may permit discovery to aid it in deciding the motion, whether based on affidavits, International Techs. Consult., Inc. v. Euroglas, 107 F.3d 386 (6th Cir.1997) (plaintiff was ordered to respond to motion challenging personal jurisdiction after completion of discovery on jurisdictional issues; no evidentiary hearing held), or by conducting an evidentiary hearing, Serras, 875 F.2d at 1214 (court may "order discovery of a scope broad enough to prepare the parties for [the evidentiary] hearing"). The court has discretion to select which method to follow, and will only be reversed for abuse of that discretion. Michigan Nat'l Bank v. Quality Dinette, Inc., 888 F.2d 462, 466 (6th Cir.1989); Serras, 875 F.2d at 1214.
If the court determines that the motion can be decided without a hearing, it "must consider the pleadings and affidavits in the light most favorable to the plaintiff." Welsh v. Gibbs, 631 F.2d 436, 439 (6th Cir.1980), cert. denied, 450 U.S. 981, 101 S.Ct. 1517, 67 L.Ed.2d 816 (1981). The plaintiff, however, bears the "relatively slight" burden of establishing a prima facie case of personal jurisdiction. American Greetings Corp. v. Cohn, 839 F.2d 1164, 1168-69 (6th Cir.1988). If the plaintiff demonstrates the existence of a prima facie case of personal jurisdiction over the defendant, after reading the pleadings and *923 the affidavit(s) so construed, the defendant's motion will be denied, notwithstanding contrary allegations made by the defendant. Serras, 875 F.2d at 1214.[4]
In the present case, Plaintiffs have provided the Court with affidavits and other materials to support their argument that the exercise of personal jurisdiction over Ryder Canada is proper. In the exercise of its discretion, the Court has chosen to resolve the jurisdictional issue on the basis of the pleadings, affidavits, and other evidence before it. Consequently, the Court will construe the parties' evidence in a light most favorable to Plaintiffs (the party against whom the motion is directed) and against Ryder Canada. With the foregoing guidelines in mind, the Court turns now to its analysis of the in personam jurisdiction issue.
In deciding whether this Court may exercise personal jurisdiction over the Ryder Canada, the Court must look to the law of the forum state. E.g., Southern Machine Co. v. Mohasco Indus., Inc., 401 F.2d 374, 376 n. 2 (6th Cir.1968). If the forum state's long-arm statute reaches the defendant, the court must then decide whether the defendant's due process rights would be infringed by the exercise of jurisdiction over him. E.g., Nationwide Mut. Ins. Co. v. Tryg Int'l Ins. Co., 91 F.3d 790, 793 (6th Cir.1996). Although Ryder Canada cites to Ohio's long-arm statute, its argument focuses on whether the exercise of personal jurisdiction over it would comport with due process, under either specific jurisdiction or general jurisdiction. Accordingly, the Court will follow Defendant's analytical framework and will likewise turn to the due process requirement.
A. General Jurisdiction
The Sixth Circuit has recognized that the due process limits on personal jurisdiction make a distinction between general jurisdiction and specific jurisdiction. E.g., Third National Bank of Nashville v. WEDGE Group, Inc., 882 F.2d 1087, 1089 (6th Cir.1989); Donatelli v. National Hockey League, 893 F.2d 459 (1st Cir.1990). With general jurisdiction, a defendant's "contacts with the forum state are of such a `continuous and systematic' nature that the state may exercise personal jurisdiction over the defendant[,] even if the action is unrelated to the defendant's contacts with the state." WEDGE Group, 882 F.2d at 1089. However, even though the due process clause allows for general jurisdiction, Ohio's long-arm statute precludes general personal jurisdiction in this forum. Smith v. Turfway Park, Case No. 3:97-145, Doc. # 13 (Mar. 13, 1998)(Rice, J.). Thus, in order for this Court to exercise personal jurisdiction over Ryder Canada, the Court may not rely on general jurisdiction but, rather, must conclude that specific jurisdiction over Defendant is proper.
Assuming, arguendo, that Ohio's long-arm statute permits general jurisdiction, Plaintiffs argue that this Court may exercise general jurisdiction over Ryder Canada, based on the fact that it is a wholly-owned subsidiary of Ryder Transportation Corporation, which has continuous and systematic contact with the State of Ohio. It is well-established that a parent company may be subject to personal jurisdiction in a state where its subsidiary is doing business, provided that the corporate separation is fictitious, the parent has held the subsidiary out as its *924 agent, or the parent has exercised undue control over the subsidiary. Velandra v. Regie Nationale des Usines Renault, 336 F.2d 292, 296 (6th Cir.1964). However, the mere fact that a parent company has a wholly-owned subsidiary in the forum state does not render the parent company subject to the personal jurisdiction of the courts therein. Id. "So long as the parent corporation and its subsidiary maintain separate and distinct corporate entities, the presence of one in a local forum may not be attributed to the other." WEDGE Group, Inc., 882 F.2d at 1093 (concurring opinion). In WEDGE Group, Inc., the Sixth Circuit held that a parent corporation, Wedge, was subject to personal jurisdiction in Tennessee, based on the actions of The Rogers Companies, Inc. ("TRC"), a Tennessee company and its wholly-owned subsidiary. Although Wedge had never directly conducted business, held title to property, or retained employees in Tennessee, the Court recounted five grounds that established that Wedge had purposefully availed itself of the privilege of conducting activities in Tennessee, to wit: 1) TRC was a wholly-owned subsidiary of Wedge; 2) Wedge was not a mere passive owner of TRC; rather, it was actively involved in TRC's management; 3) Wedge had entered into an agreement with TRC, under which it shared income tax liability with the TRC; 4) Wedge officers had participated in negotiations with TRC and the plaintiff; and 5) Wedge had entered into an agreement with TRC and the plaintiff, and the contract was executed in Tennessee. Thus, the parent company's own actions and the actions of its subsidiary, over which it exhibited management control, were sufficient to subject it to the personal jurisdiction of courts within Tennessee.
Although a parent company may, under certain circumstances, be subject to personal jurisdiction based on the contacts of its subsidiary, this Court has found few cases that have addressed whether the converse is true, namely whether a subsidiary may be subject to personal jurisdiction based on the contacts of its parent corporation. The few federal courts that have done so have required a fictitious or agency relationship between the parent and the subsidiary. Blount v. Peerless Chemicals (P.R.), Inc., 316 F.2d 695 (2d Cir.1963). Some courts have applied a stricter standard, concluding that "where a foreign subsidiary and a local parent have failed to maintain separate corporate identities, there is no personal jurisdiction over the foreign subsidiary without a showing that the subsidiary was `present' in the forum through its direction and manipulation of local parental activities." Henry v. Offshore Drilling (W.A.) Pty., Ltd., 331 F.Supp. 340, 343 (E.D.La.1971); Turan v. Universal Plan Inv. Ltd., 70 F.Supp.2d 671, 675 (E.D.La.1999) ("Holding a subsidiary responsible for the corporate activities of its parent corporation would offend `traditional notions of fair play and substantial justice'[,] because a subsidiary would be liable for activities for which they were not responsible in locations in which they lack meaningful contacts.")
Assuming that this Court should apply herein the same standard that the Sixth Circuit has employed when determining whether a court may exercise personal jurisdiction over a parent company based on the contacts of its subsidiary (as opposed to the stricter standard adopted in the Eastern District of Louisiana), Plaintiffs have not provided evidence to support a prima facie case that personal jurisdiction over Ryder Canada is proper, based on the contacts of its parent company. In support of its argument, Plaintiffs have attached excerpts from the deposition testimony of Mr. Samuel Tanner, a representative of Navistar. In addressing Ryder Canada's corporate structure, Mr. Tanner *925 stated that he believed that Ryder Canada has an American parent corporation, located in Miami, Florida (Pls' Ex. 5 at 36). Mr. Tanner further indicated that he has been told by the Canadian General Manager that he reports to people in the United States (Pls' Ex. 5 at 37). According to affidavit of Mr. Robenalt, counsel for Plaintiffs, counsel for Ryder Canada confirmed that the company is, in fact, a wholly-owned subsidiary of Ryder Transportation Services, located in Florida (Pls' Ex. 4 ¶ 9).
In addition to the above-mentioned evidence, Plaintiffs have also provided an affidavit from attorney Kimberly A. Coleman (Pls' Ex. 6). In that document, she states that on September 27, 2000, she contacted Ryder Truck Rental at the telephone number 1-800-463-9337, which appears in the Ameritech Yellow Pages for Cleveland, Ohio. She questioned the Ryder Truck Rental representative as to whether she could rent a truck in the Province of Alberta, Canada. Ms. Coleman was provided two toll-free telephone numbers, one to rent a truck for consumer purposes and the other to rent a truck for commercial purposes. She was further informed that the two numbers applied to any rentals in the United States or Canada.
As a threshold matter, for Ryder Canada to be subject to general jurisdiction based on its parent company's contacts, Plaintiffs must present evidence that Ryder Transportation Services is subject to general jurisdiction in Ohio (again, assuming, arguendo, general jurisdiction to be permissible in this forum). Plaintiffs' only evidence in this regard is the affidavit of Ms. Coleman regarding her ability to obtain truck rental information for Canada, upon calling a toll-free telephone number, which was listed in Ohio. Numerous courts to address the issue have held that toll-free telephone listings, without more, are insufficient contacts upon which to subject a company to suit. See, e.g., Rothschild Berry Farm v. Serendipity Group LLC, 84 F.Supp.2d 904 (S.D.Ohio 1999)(Rice, J.), citing Estate of Poole v. Grosser, 134 Ohio App.3d 386, 731 N.E.2d 226, 1999 WL 420059 (1999)(advertising in an Ohio telephone directory does not constitute a persistent course of conduct within this state); Bradley v. Mayo Foundation, 1999 WL 1032806 (E.D.Ky. Aug.10, 1999)(maintenance of 51 toll-free telephone lines and two internet web sites should not subject the defendant to personal jurisdiction). Accordingly, Plaintiffs have not submitted any evidence from which the Court may conclude that it may exercise general jurisdiction over Ryder Transportation Services and, through that company, Ryder Canada.[5]
Even if the Court could conclude that Ryder Transportation Services was subject to this Court's general personal jurisdiction, the fact that Ryder Canada is a wholly-owned subsidiary of Ryder Transportation Services does not, by itself, subject Ryder Canada to the jurisdiction of this Court based its parent company's contacts in Ohio. Although Mr. Tanner has stated that the Canadian General Manager of Ryder Canada reports to people in the United States (Pls' Ex. 5 at 37), this evidence is insufficient to suggest that Ryder Transportation Services directed and managed Ryder Canada's operations, such that the Court could conclude that Ryder Transportation Services exercised undue control over Ryder Canada, or that the corporate separation between the companies is fictitious. Moreover, Ms. Coleman's statement that she was provided two tollfree *926 telephone numbers, which she could call to rent a truck anywhere in the United States or Canada, is insufficient for this Court to conclude that Ryder Canada was an agent of its parent company (or vice versa), and was held out to the public as such. Accordingly, even if Ohio permitted the exercise of general jurisdiction, Plaintiffs have not presented evidence that Ryder Transportation Services has "continuous and systematic" contacts with Ohio, thus allowing personal jurisdiction over it on the basis of general jurisdiction. In addition, Plaintiffs have failed to present evidence that the relationship between that company and Ryder Canada is such that this Court could exercise personal jurisdiction over Ryder Canada, based on the contacts of its parent company. Because the Court may not exercise general jurisdiction over Ryder Canada, the Court now turns to whether that Defendant is subject to suit in this forum, based on specific jurisdiction.
B. Specific Jurisdiction
The Sixth Circuit has established a three-part test for determining whether a court can exercise specific personal jurisdiction over a nonresident defendant. Southern Machine Co., 401 F.2d at 381; Nationwide, 91 F.3d at 794. First, "the defendant must purposefully avail himself of the privilege of conducting activities within the forum state." This requirement ensures that defendants are not subjected to jurisdiction based solely upon random or attenuated contacts, or the unilateral activity of another party. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985). "Jurisdiction is proper under the purposeful availment requirement where `the contacts proximately result from actions by the defendant himself that create a substantial connection with the forum state.'" Reynolds v. International Amateur Athletic Fed'n, 23 F.3d 1110, 1116 (6th Cir.), cert. denied, 513 U.S. 962, 115 S.Ct. 423, 130 L.Ed.2d 338 (1994)(quoting Burger King, 471 U.S. at 475, 105 S.Ct. 2174). The mere fact that a defendant entered into a contract with the plaintiff in the forum state does not constitute purposeful availment. Kerry Steel, Inc. v. Paragon Indus., Inc., 106 F.3d 147 (6th Cir.1997). "[T]he defendant's conduct and connection with the forum must be of a character that he or she `should reasonably anticipate being haled into court there.'" Id. (quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980)).
Second, "the cause of action must arise from the defendant's activities there." Third, the acts by the defendant must have a substantial enough connection with the forum state to make the exercise of jurisdiction over the defendant fundamentally fair. Southern Machine Co., 401 F.2d at 381. When a court finds that a defendant has purposefully availed itself of the privilege of conducting activities within Ohio and the cause of action arose from that contact, it is presumed that the assertion of personal jurisdiction is proper. Cole, 133 F.3d 433; see American Greetings Corp., 839 F.2d at 1170 (when first two elements met, an inference arises that the third is also met). A court must consider several factors in this context, including "the burden on the defendant, the interest of the forum state, the plaintiff's interest in obtaining relief, and the interest of other states in securing the most efficient resolution of controversies." American Greetings Corp., 839 F.2d at 1169-70.
In their Complaint, Plaintiffs have not alleged any facts which would support a prima facie case of specific personal jurisdiction over Ryder Canada. In *927 addition, they have neither argued in their memorandum nor provided evidence to support a prima facie showing that the exercise of specific jurisdiction over Ryder Canada is proper. There is no evidence that Ryder Canada reached out to Ohio to conduct business. The fact that reservations for vehicles in Canada could be made via a telephone call from Ohio is insufficient to support a finding that Ryder Canada purposefully availed itself of the privilege of conducting business in Ohio. See Rothschild, supra. Moreover, this litigation arises from the failure of a vehicle which, although manufactured in Ohio, was purchased by Ryder Canada from Navistar International Corporation Canada.[6] The fact that Navistar might have sent the truck directly from its Springfield, Ohio, facility to Ryder Canada's agents in Canada does not cause this litigation to arise from any actions of Ryder Canada in Ohio.[7] In addition, given the accident's location in Alberta, that all of Ryder Canada's service to the vehicle occurred in Alberta, and the lack of evidence to support showings that Ryder Canada purposefully availed itself of the privilege of conducting business in Ohio and that this action arises out of Defendant's conduct in Ohio, the Court concludes that the exercise of specific personal jurisdiction would violated fundamental fairness. In summary, Plaintiffs have failed in their burden of making a prima facie showing that the Court may exercise specific personal jurisdiction over Ryder Canada. Accordingly, Defendant's Motion to Dismiss, for lack of personal jurisdiction (Doc. # 24), must be SUSTAINED.
For the foregoing reasons, Ryder Canada's Motion to Dismiss, for lack of personal jurisdiction, pursuant to Fed.R.Civ.P. 12(b)(2) (Doc. # 24), is SUSTAINED.
NOTES
[1] The following facts are taken from Plaintiffs' Amended Complaint (Doc. # 13).
[2] The Complaint states that the WCB has provided workers' compensation benefits to MacDonald, including, but not limited to, medical expenses in excess of $500,000, and that it is subrogated to MacDonald's rights, pursuant to section 17 of the Workers' Compensation Act of Canada.
[3] Plaintiffs indicate that they dismissed these Defendants, based on representations by counsel for Ryder Canada that it was the only entity involved with the subject vehicle and, therefore, Ryder Canada was the only proper Defendant in this action.
[4] It is axiomatic that the use of materials outside the pleadings, in ruling on a motion to dismiss for alleged lack of in personam jurisdiction, is permissible and does not convert the motion into one directed to the merits of the litigation, i.e., one for summary judgment.
[5] Plaintiffs have not submitted any additional evidence which indicate the nature and extent of Ryder Transportation Services' contacts with the State of Ohio.
[6] Although Plaintiffs state in their memorandum that Ryder Canada purchased the subject vehicle from Navistar in Ohio (Doc. # 29 at 12), the evidence from both parties contradict that assertion. Both Mr. Mealia and Mr. Tanner state that the vehicle was sold to Ryder Canada from Navistar in Canada. See Pls' Ex. 5 at 17(stating that the vehicle at issue in this litigation was manufactured by Navistar International Transportation Corporation, and it was then sold to Navistar International Corporation Canada, a wholly-owned subsidiary of Navistar International Transportation Corporation); Def's Ex. 1 ¶ 4 (Ryder Canada ordered the truck from Navistar International Transportation Company in Ontario, Canada). Thus, it is undisputed that the vehicle, although manufactured in Ohio, was purchased by Ryder Canada from Navistar's Canadian subsidiary.
[7] Mr. Tanner indicated that the truck was likely sent directly from Springfield, Ohio, to Coaldale, Alberta, Canada, to a company named Intercontinental Truck Body Ltd (id. at 26), which Plaintiffs asserts was an agent of Ryder Canada.
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UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
GREGORY T. HOWARD,
Plaintiff,
v. Civil Action No. 09-531 (CKK)
UNITED STATES DISTRICT COURT FOR
THE SOUTHERN DISTRICT OF OHIO, et al.,
Defendants.
MEMORANDUM OPINION
(March 30, 2009)
This matter is before the Court on plaintiff’s pro se Complaint filed on March 18, 2009.
The Court shall dismiss the complaint sua sponte pursuant to 28 U.S.C. § 1915(e)(2)(B)(iii)
(“[n]otwithstanding any filing fee . . . that may have been paid, the court shall dismiss the case at
any time if the court determines that the action . . . seeks monetary relief against a defendant who
is immune from such relief”) and Federal Rule of Civil Procedure 12(h)(3) (“[i]f the court
determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the
action”).
Plaintiff has sued the United States District Court for the Southern District of Ohio, the
United States Department of Justice, the United States Attorney General, the Administrative
Office of the United States Courts, and the United States Department of the Treasury, for
$27,519,203.43.1 Plaintiff indicates that he intends to seek leave to add the United States Court
1
The Court notes that Plaintiff has been declared a vexatious litigator under Ohio law and
is apparently subject to restrictions on his access to the state courts of Ohio. See Howard v. Ohio
Supreme Court, No. 07-514, 2008 U.S. Dist. LEXIS 6437 at *4-*12 (S.D. Ohio Jan. 14, 2008).
of Appeals for the Sixth Circuit and the United States Supreme Court as additional Defendants.
See Compl. ¶ 20. Notwithstanding the identities of the named or putative Defendants, it is
apparent that Plaintiff’s Complaint seeks damages in connection with various rulings made by
Judge Algenon L. Marbley in a case involving Plaintiff in the Federal District Court of the
Southern District of Ohio. Judges are absolutely immune from lawsuits predicated on acts taken,
as alleged here, in their judicial capacities. Forrester v. White, 484 U.S. 219, 225 (1988); Stump
v. Sparkman, 435 U.S. 349, 355-57 (1978); Sindram v. Suda, 986 F.2d 1459, 1460 (D.C. Cir.
1993). Although Plaintiff mistakenly asserts that 28 U.S.C. § 1331 provides this court with
“jurisdiction over other district court’s orders,” Compl. ¶ 31, this is not an appellate Court and
the Court lacks jurisdiction to review the judgments of other federal courts.
Accordingly, Plaintiff’s Complaint shall be dismissed, and the summons issued shall be
quashed. A separate Order accompanies this Memorandum Opinion.
Date: March 30, 2009
/s/
COLLEEN KOLLAR-KOTELLY
United States District Judge
2
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194 S.E.2d 213 (1973)
17 N.C. App. 335
FOOD FAIR, INC.
v.
CITY OF HENDERSON, N. C., et al.
No. 729SC507.
Court of Appeals of North Carolina.
February 14, 1973.
*214 Rogers & Senter by Bobby W. Rogers, Henderson, for plaintiff appellee.
Perry, Kittrell, Blackburn & Blackburn by Charles F. Blackburn, Henderson, for defendants appellants.
PARKER, Judge.
As their authority for refusing to issue to plaintiff the license applied for, appellants rely upon Chap. 936 of the 1945 Session Laws. Section 2 of that Act reads as follows:
"Sec. 2. The governing body of any municipality in Vance, Scotland and Moore Counties in their discretion are hereby authorized to refuse to issue a license for the sale of wine within the corporate limits of said municipality."
In its complaint, plaintiff attacked the constitutionality of this Act. In the judgment appealed from the trial court expressly made "no findings or determination as to the constitutionality" of Chap. 936, 1945 Session Laws, but rested its judgment upon its conclusion that G.S. § 105-113.82 "requires the mandatory issuance of a license for the sale of fortified and unfortified wines off premises to all persons who have complied with the provisions of Chap. 18A of the General Statutes of North Carolina and N.C.G.S. § 105-113.80." In so holding, it is apparent that the trial judge was of the opinion that G.S. § 105-113.82 superseded and in effect repealed Chap. 936 of the 1945 Session Laws. We first examine this basis for the trial court's judgment.
G.S. § 105-113.82, as enacted by Section 2 of Chap. 872 of the 1971 Session Laws, provides in part as follows:
"§ 105-113.82. Issuance of license mandatory.Except as herein provided, it shall be mandatory that the governing body of a municipality or county issue a license to any applicant when such person shall have complied with requirements of this Article and Chapter 18A:. . . ."
While we have found no Act of our General Assembly expressly repealing Chap. 936 of the 1945 Session Laws, a logical argument can be made that enactment of G. S. § 105-113.82 did so by clear implication. However, repeals by implication are not favored, and "[o]rdinarily, a special or local statute is not repealed by a subsequent general statute of statewide application, but the special or local statute will be given effect as an exception to the general statute, notwithstanding a general repealing clause in the general statute." 7 Strong, N.C. Index 2d, Statutes, § 11, p. 85; see, Bland v. City of Wilmington, 278 N.C. 657, 180 S.E.2d 813. Moreover, the evolutionary history leading to enactment of G.S. § 105-113.82 in its present form fails to reveal any clear legislative intent to repeal Chap. 936 of the 1945 Session Laws. Present G.S. § 105-113.82 had its genesis in Section 513 of the Beverage Control Act of 1939, which was one of the Articles of the Budget Revenue Bill of that year, Chap. 158 of the 1939 Session Laws. Section 513 of that Act contained the following:
"SEC. 513. It shall be mandatory that the governing body of a municipality or *215 county issue license to any person applying for the same when such person shall have complied with requirements of this article: . . . ."
Subsequently in the 1939 Session of the General Assembly this section was amended by adding provisos authorizing the governing bodies in certain named counties or of any municipality therein in their discretion to decline to issue the "on premises" licenses provided for in the Beverage Control Act and to prohibit sale of beer and/or wine on Sundays. When the General Statutes were enacted in 1943, the Beverage Control Act of 1939 as then amended was placed under Chap. 18, entitled "Intoxicating Liquors," Section 513 appearing as G. S. § 18-77. At the 1945 Session of the General Assembly, G.S. § 18-77 was amended by adding additional provisos and by adding Vance and Macon Counties and the City of Greensboro to the list of localities, the governing bodies of which were granted discretionary authority to refuse to issue the "on premises" licenses. These 1945 amendments were enacted by Chap. 708, Section 6, and by Chaps. 934, 935 and 1037 of the 1945 Session Laws. It is noteworthy that two of these, Chaps. 934 and 935, were enacted on the same day and immediately before the enactment of Chap. 936 of the 1945 Session Laws, the very Act upon which the defendants in the present case rely. It is manifest, therefore, that the 1945 General Assembly which enacted Chap. 936 intended that it be construed together with G.S. § 18-77 as then enacted in such manner as to give effect to both. G. S. § 18-77 was again amended in 1947, but simply to add Bertie to the list of counties named therein. Chap. 932, 1947 Session Laws. As thus amended, G.S. § 18-77 remained unchanged until enactment of Chap. 872 of the 1971 Session Laws, entitled "An Act to Rewrite General Statutes Chapter 18, Rewrite and Transfer to Chapter 105 the Revenue Statutes Formerly in Chapter 18 and to Repeal Certain Inconsistent Sections." This Act repealed Chap. 18 and certain other sections of the General Statutes, enacted a new chapter designated 18A and entitled "Regulation of Intoxicating Liquors," and by Section 2 amended Chap. 105 of the General Statutes by inserting therein a new Article 2C entitled "Intoxicating Liquors Tax." As part of this Article present G.S. § 105-113.82 was enacted, thus returning this Statute to its birthplace among the statutes dealing with taxation.
Important in the foregoing history is the fact that G.S. § 105-113.82 as enacted in 1971 is in every respect which is material to the question now before us identical with the provisions of former G.S. § 18-77 as that Statute existed in 1945 when Chap. 936 of the 1945 Session Laws was enacted. By merely moving this Statute from former Chap. 18 and placing it in Chap. 105 of the General Statutes without making any significant change in its language, the 1971 General Assembly failed to manifest any clear legislative intent to repeal by implication Chap. 936 of the 1945 Session Laws. In our opinion Chap. 936, 1945 Session Laws, has not been repealed.
Having concluded, contrary to the opinion of the trial court, that Chap. 936, 1945 Session Laws has not been repealed, we now consider plaintiff's contention that in any event Section 2 of that Act is unconstitutional as being in violation of Article II, Section 24(1)(j), of the Constitution of North Carolina which provides that the General Assembly shall not enact any local, private or special act regulating trade. In our opinion, Section 2 of Chap. 936, 1945 Session Laws is violative of this provision of our Constitution. Smith v. County of Mecklenburg, 280 N.C. 497, 187 S.E.2d 67. By its terms it applies only to the governing bodies of municipalities in three counties. In relation to the purpose of the Act the affected counties and the municipalities therein do not rationally differ from the remaining ninety-seven counties and the municipalities located therein. There is thus no question but that it is a local Act within the meaning of that term as employed in Article II, Section 24(1)(j) of *216 our State Constitution. The selling of wine is a trade, Smith v. County of Mecklenburg, supra, and the Act purports to grant discretionary authority to the governing bodies of municipalities in the three affected counties to refuse to issue a license for conducting this trade within the corporate limits of such municipalities. It is, therefore, clear that Section 2 of Chap. 936 of the 1945 Session Laws is a local Act regulating trade. The fact that it is permissive and takes effect only when invoked by the governing body of some municipality in one of the three named counties does not make it any the less an Act regulating trade. Surplus Co. v. Pleasants, Sheriff, 264 N.C. 650, 142 S.E.2d 697.
For the reasons stated above, we agree with the trial court's ultimate conclusion that defendants have no discretion to refuse to issue to the plaintiff the license applied for, and the judgment appealed from is
Affirmed.
VAUGHN and GRAHAM, JJ., concur.
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540 U.S. 868
JAMESv.WALKER, WARDEN.
No. 02-11328.
Supreme Court of United States.
October 6, 2003.
1
Appeal from the C. A. 11th Cir.
2
Certiorari denied.
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10-854-cv
Katzenberg v. Lazzari
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
Rulings by summary order do not have precedential effect. Citation to summary orders filed on or after
January 1, 2007, is permitted and is governed by Federal Rule of Appellate Procedure 32.1 and this
court’s Local Rule 32.1.1. When citing a summary order in a document filed with this court, a party
must cite either the Federal Appendix or an electronic database (with the notation “summary order”).
A party citing a summary order must serve a copy of it on any party not represented by counsel.
At a stated term of the United States Court of Appeals for the Second Circuit, held at the
Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New York, on
the 21st day of January, two thousand eleven.
PRESENT:
JOSÉ A. CABRANES,
REENA RAGGI,
Circuit Judges,
RICHARD K. EATON ,
Judge.*
-------------------------------------------x
HARVEY KATZENBERG ,
Plaintiff–Counter-Defendant-Appellant,
-v.- No. 10-854-cv
DERVAL LAZZARI, as Trustee of the Acme American Repairs,
Inc., Pension Trust, ACME AMERICAN REPAIRS, INC ., ACME
AMERICAN REPAIRS, INC ., PENSION TRUST,
Defendants-Counter-Claimants-Appellees.**
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
*
The Honorable Richard K. Eaton, of the United States Court of International Trade, sitting
by designation.
**
The Clerk of the Court is directed to amend the official caption of this action to conform
to the caption listed above.
1
FOR PLAINTIFF-COUNTER-DEFENDANT-APPELLANT: DAVID B. GELFARB,
Moss & Kalish
PLLC, New York,
NY.
FOR DEFENDANTS-COUNTER-CLAIMANTS-APPELLEES: HELEN M. BENZIE
(Anthony Marino, of
counsel), Law Office of
Vincent D.
McNamara, East
Norwich, NY.
Appeal from a February 24, 2010, judgment of the United States District Court for the
Eastern District of New York (Charles R. Wolle, Judge).1
UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED,
AND DECREED that the judgment of the District Court be AFFIRMED.
Plaintiff-Appellant Harvey Katzenberg—a former owner and executive of Acme American
Repairs, Inc. (“Acme”) and a participant in and former trustee of the Acme Pension Plan (“Acme
Plan”)—brought this action pursuant to Section 502 of the Employees’ Retirement Income Security
Act (“ERISA”), 29 U.S.C. § 1132, seeking an award of pension benefits, 29 U.S.C. § 1132(a);
sanctions resulting from the Acme Plan’s failure to provide him with a summary plan description
(“SPD”), 29 U.S.C. § 1132(c)(1); and an award for attorney’s fees, 29 U.S.C. § 1132(g). Defendants-
Appellees raised several defenses and a counterclaim, all related to Katzenberg’s alleged breech of
fiduciary duties as a trustee of the Acme Plan. After a bench trial, the District Court entered
judgment in favor of defendants, concluding that (1) defendants’ defenses are not barred by
ERISA’s statute of limitations; (2) dismissing all of Katzenberg’s claims; and (3) denying attorney’s
fees to all parties. Katzenberg v. Lazzari, 04-cv-5100, 2010 WL 680985, at *7 (E.D.N.Y. Feb. 24,
2010). Katzenberg filed a timely appeal. We assume the parties’ familiarity with the facts and
procedural history of this case.
I. Forfeiture Remedy
First, Katzenberg argues that the District Court erred in concluding that he should forfeit his
entitlement to benefits under the plan pursuant to 29 U.S.C. § 1109(a), which provides that a
fiduciary who breaches his duties under ERISA “shall be personally liable to make good to such
plan any losses to the plan resulting from each such breach . . . and shall be subject to such other
1
The Honorable Charles R. Wolle, United States District Judge for the Southern District of
Iowa, sitting by designation.
2
equitable or remedial relief as the court may deem appropriate.” As we have frequently noted, it is
well-settled that ERISA grants the court broad discretion with respect to remedies under § 1109(a)
and that we review its decisions for abuse of discretion, Katsaros v Cody, 744 F.2d 270, 281 (2d Cir.
1984), taking into account “all the circumstances of the case,” Chao v. Merino, 452 F.3d 174, 185 (2d
Cir. 2006). “A district court has abused its discretion if it [has] based its ruling on an erroneous view
of the law or on a clearly erroneous assessment of the evidence, or rendered a decision that cannot
be located within the range of permissible decisions.” Sims v. Blot, 534 F.3d 117, 132 (2d Cir. 2008)
(citation, alterations, and quotation marks omitted).
Here, the record reflects that, in violation of federal law, Katzenberg repeatedly raided the
Acme Plan and overstated its value to minimize Acme’s required annual contribution. See 29 U.S.C.
§ 1104(a)(1); Varity Corp. v. Howe, 516 U.S. 489, 506 (1996); Central States, S.E. & S.W. Areas Pension
Fund v. Central Transp., 472 U.S. 559, 571 (1985) (“ERISA clearly assumes that trustees will act to
ensure that a plan receives all funds to which it is entitled, so that those funds can be used on behalf
of participants and beneficiaries.”). Contrary to Katzenberg’s claims, this Court has clearly
established that the “the power of the courts to fashion [the] equitable remedy” reached by the
District Court in this case—that is, a permanent injunction preventing the trustee from receiving
benefits under the plan—is not necessarily an abuse of discretion. United States v. Carson, 52 F.3d
1173, 1190 (2d Cir. 1995) (affirming the District Court’s decision to require a fiduciary to forfeit
benefits after breaching his duties). We therefore affirm the judgment of the District Court and
hold that when a fiduciary who is placed in a position of trust shows such contempt for the
beneficiaries to whom he owes a legal duty, the entry of a permanent injunction denying him his
benefits in order to make the fund whole is not an abuse of discretion.
II. Statute of Limitations
Second, Katzenberg argues that—in determining that defendants’ affirmative defenses and
counterclaim are not barred under ERISA—the District Court improperly applied the six-year
statute of limitations under 29 U.S.C. § 1113 for cases of fraud or concealment, as opposed to the
three-year statute of limitations under § 1113(2). Katzenberg suggests that because he made no
effort to conceal his illegal activities, the statute of limitations ended three years after the errors were
discovered by his successor in 2001. This argument misconstrues ERISA. It is well settled that
fraud and concealment are distinct concepts with respect to 29 U.S.C. § 1113. That is, a trustee’s
conduct does not have to constitute fraudulent concealment under ERISA in order to trigger the
six-year statute of limitations. Caputo v. Pfizer, Inc., 267 F.3d 181, 190 (2d Cir. 2001) (“[T]he six-year
statute of limitations should be applied to cases in which a fiduciary: (1) breached its duty by making
a knowing misrepresentation or omission of a material fact to induce an employee/beneficiary to act
to his detriment; or (2) engaged in acts to hinder the discovery of a breach of fiduciary duty.”
(emphasis in original)).
3
In this case, whether or not he attempted to conceal his activities, the record supports the
District Court’s conclusion that Katzenberg—as trustee of the Acme Plan—knowingly misrepresented
the value of the plan and removed assets from the plan without authority or adequate
documentation, all in violation of ERISA. This conduct falls squarely within the language of § 1113
which states that “in the case of fraud . . . [an action with respect to a fiduciary’s breach of duty] may
be commenced not later than six years after the date of discovery of such breach.” See Caputo, 267
F.3d at 189 (citing Black’s Law Dictionary 670 (7th ed. 1999) (defining “fraud” as “[a] knowing
misrepresentation of the truth . . . to induce another to act to his or her detriment”)). Even
assuming, arguendo, that defendants’ second amended answer does not relate back to the filing of the
complaint or the initial answer, defendants’ affirmative defenses and counterclaims were timely filed
in May 2007 given that defendants did not discover Katzenberg’s breaches of fiduciary duties until
late 2001 at the earliest. We therefore hold that the District Court correctly determined that the six-
year statute of limitation does not bar defendants’ affirmative defenses and counterclaim in this case.
III. Summary Plan Description (SPD)
Third, Katzenberg argues that the District Court erred in concluding that “Katzenberg has
not proved anyone except Katzenberg himself violated ERISA” as a result of the Acme Plan’s
failure to have, much less distribute, an SPD, and in dismissing his claim for sanctions. Katzenberg,
2010 WL 680985, at *4. If the Acme Plan’s failure to have in its possession an SPD in accordance
with the requirements of 29 U.S.C. §§ 1021(a)(1), 1022(a) while Katzenberg was the trustee of the
plan constituted a violation of ERISA, then the Acme Plan’s subsequent (and continued) failure to
have an SPD after Katzenberg relinquished his duties as a trustee in 2001 is a violation of ERISA as
well. That is, however, not the end of our analysis under § 1132(c).
It is well settled that a district court enjoys considerable discretion in deciding whether to
award ERISA sanctions pursuant to § 1132(c), and that we review such a decision for “abuse of
discretion.” See Demery v. Extebank Deferred Compensation Plan(B), 216 F.3d 283, 290 (2d Cir. 2000). In
this case, we find no abuse in the district court’s denial of sanctions. As the Supreme Court has
noted, the purpose of ERISA’s disclosure provisions are to ensure that “‘the individual participant
knows exactly where he stands with respect to the plan.’” Firestone Tire & Rubber Co. v Bruch, 489 U.S.
101, 118 (1989) (quoting H.R. Rep. No. 93-533, at 11 (1973)). We agree with the District Court that
Katzenberg— as the sole trustee with knowledge of the Plan for more than two decades—cannot
plausibly claim that, even after his departure from the company, he lacked the proper information to
know where he stood with respect to the plan. Accordingly, in the absence of any prejudice to
Katzenberg, see Devlin v. Empire Blue Cross & Blue Shield, 274 F.3d 76, 90 (2d Cir. 2001) (holding that
the absence of prejudice is an important factor to be considered by a court in exercising its
discretion against an award of sanctions), we cannot say that the District Court abused its discretion
in denying Katzenberg sanctions pursuant to § 1132(c) and dismissing his claim.
4
IV. Attorney’s Fees
Finally, Katzenberg argues that the District Court erred in denying him attorney’s fees. We
review a decision to award fees under ERISA for abuse of discretion. See Chambless v. Masters, Mates
& Pilots Pension Plan, 815 F.2d 869, 871 (2d Cir. 1987). Even if the district court had wrongly
applied the five-factor test for determining when fees are appropriate as articulated in Chambless, the
Supreme Court has recently established that a party must achieve “some degree of success on the
merits” to earn fees under ERISA. Hardt v. Reliance Standard Life Ins. Co., 560 U.S. —-, 130 S. Ct.
2149, 2158 (2010) (internal quotation marks omitted). Accordingly, because Katzenberg achieved
no success on the merits, we cannot say that the District Court’s decision not to award attorney’s
fees was an abuse of discretion.
CONCLUSION
We have considered each of Katzenberg’s arguments on appeal and find them to be without
merit. For the reasons stated above, the judgment of the District Court is AFFIRMED.
FOR THE COURT
Catherine O’Hagan Wolfe, Clerk
5
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339 So.2d 48 (1976)
Mary Lee BROUSSARD, Plaintiff-Appellant,
v.
ACADIA INDUSTRIES, INC., et al., Defendants-Appellees.
No. 5666.
Court of Appeal of Louisiana, Third Circuit.
November 10, 1976.
*49 Cline, Richard & Miller by Jack D. Miller, Rayne, for plaintiff-appellant.
Davidson, Meaux, Onebane & Donohoe by Robert M. Mahony, Lafayette, for defendant-appellee.
Before HOOD, DOMENGEAUX and GUIDRY, JJ.
HOOD, Judge.
Mary Lee Broussard instituted this suit for workmen's compensation benefits against Acadia Industries, Inc., and its insurer, Fireman's Fund American Insurance Companies. The trial judge rendered judgment in favor of defendants dismissing the suit. Plaintiff appealed.
The only issue presented is whether plaintiff's present disability resulted from an accident which arose out of or in the course of her employment.
Plaintiff worked as a bag seamstress for Acadia Industries from February, 1974, until December 24 of that year. She alleges that shortly after reporting for work on or about September 10, 1974, she fell to the floor when a leg of the sewing machine chair on which she was sitting broke. She landed in a sitting position, but she got up immediately after the fall. The foreman of the shop repaired the chair, and plaintiff resumed her work and worked the rest of the day. She continued to work regularly at her job, performing all of her duties in a normal manner, from that time until the end of her working day on December 24, 1974, except for a period of about four days when she was hospitalized during the month of September.
We are convinced that plaintiff fell from her chair, as alleged, but the evidence indicates that the fall occurred almost two weeks prior to the time she alleged it did or that her symptoms manifested themselves several days before the fall.
Mrs. Broussard testified that she experienced pain in her back when the above accident occurred, but that she did not report an injury and she continued to work for the next three or four months despite that pain. She stated that she continued to work for "a couple of days or a couple of weeks" before she sought medical treatment, and she concedes that even then she did not tell her treating physicians that she had sustained an injury in September. She *50 explained that she did not inform anyone about the accident because she felt that the injury was not serious and she was afraid that she might lose her job if her employer knew that she had sustained an injury on the job.
Plaintiff was examined by her family physician, Dr. C. Thomas Curtis, a general practitioner, on September 11, 1974. At that time, she complained of pain "in the left upper quadrant of the abdomen," stating that she had been experiencing that pain for about two weeks. She did not complain of injury to or pain in her back, and she did not tell the doctor that she had sustained a trauma or an accident of any kind. She did not tell him even that she was working. Dr. Curtis diagnosed her condition as "myalgia," or muscle pain, and he prescribed a combination tranquilizer and muscle relaxant. He stated that at that time he considered her back to be "normal." Plaintiff was worried about an internal disease, however, so Dr. Curtis hospitalized her from September 15 to September 18, 1974, "primarily for purposes of evaluation." While in the hospital he treated her for "acute abdominal wall myalgia," and he discharged her after three or four days of treatment "on a diet which was for her stomach, thyroid medication and to continue this combination muscle relaxant."
Dr. Curtis examined plaintiff again on November 18, 1974, two months after he had discharged her from the hospital. On that occasion, Mrs. Broussard for the first time complained of pain in the low back area. She did not tell Dr. Curtis that she had sustained a trauma of any kind. The doctor found objective signs of an abnormal back condition, and he prescribed a muscle relaxant and an anti-inflammatory drug.
Mrs. Broussard sought no other medical treatment until December 25, 1974, when she was examined by Dr. Curtis in the emergency room of a hospital in Rayne. Her complaints at that time were of "severe pain in the right hip." She told the doctor that at about mid-day on Christmas, while in her home, she stooped over and then twisted slightly and sharply as she began to straighten up, and that at that time she felt a sharp pain in the right lower back area which radiated down to the mid-calf of her right leg. The pain became very severe, and she thereupon was brought to the emergency room of the hospital by ambulance. She mentioned no other trauma or accident in the history she gave. Dr. Curtis made a tentative diagnosis of "severe acute sacroiliac strain," and he hospitalized her until January 4, 1975. He concluded that plaintiff had sustained a ruptured disc, and he thereupon referred her to a specialist, an orthopedic surgeon, and he has not treated her since that time.
Dr. Curtis feels, as we understand his testimony, that plaintiff sustained a ruptured disc as a result of the incident which occurred on December 25, 1974, in her home, and that her present disability did not result from the accident which occurred in the course of her employment shortly before September 11, 1974.
Plaintiff was examined by Dr. Eugene J. Dabezies, an orthopedic surgeon, on March 6, 1975. Dr. Dabezies concluded that she had ruptured intervertebral discs at the L4-L5 and the L5-S1 levels, and he performed a procedure known as chemonucleolysis to correct that condition. Plaintiff was hospitalized from April 2 until April 11, 1975, and was seen periodically by Dr. Dabezies thereafter until October 8, 1975. Dr. Dabezies feels that plaintiff has a permanent 10% disability of the body as a whole, and that she will not be able to do the type of work which she was performing immediately prior to December 25, 1974.
The only history which plaintiff gave Dr. Dabezies relating to the onset of her symptoms was the incident which occurred on December 25, 1974. He concluded, therefore, that the injury resulted from the accident which occurred on that day.
Plaintiff called as lay witnesses four members of her immediate family, all of whom testified that she had had no complaints of pain in her back prior to the time that she fell from her chair in August or September of 1974, and that she has complained of back pain since that time.
*51 Plaintiff's work record indicates that she worked regularly, averaging about forty hours per week, during the months of October, November and December, until the end of her working day on December 24, 1974. The owner, the plant foreman and an inspector of the employer company testified that plaintiff worked normally until Christmas Day, 1974, that she did not report an injury at any time, and that she made no complaints during that time, other than the usual minor complaints made by all other employees. The first notice that the defendant employer received of the fact that plaintiff claimed that she had sustained a work connected accident was contained in a letter addressed to Acadia Industries by plaintiff's attorney, dated March 31, 1975, requesting payment of some medical bills incurred by Mrs. Broussard.
The trial judge held that there was "no causal connection between the accident of September, 1974, and the herniated discs." He felt that it was possible for plaintiff to have sustained a disc injury in September, 1974, and for it not to become symptomatic until December of that year. He concluded, however, that that was not probable and that plaintiff had failed to prove a causal connection between the alleged accident and her present disability.
Plaintiff argues that under the facts presented herein she must be presumed to have sustained a disabling injury at the time of the accident which occurred in September, 1974. She contends that defendant has failed to overcome that presumption.
A claimant's disability is presumed to have resulted from an accident, if before the accident the injured person was in good health, but commencing with the accident the symptoms of the disabling condition appear and continuously manifest themselves afterward, provided that the medical evidence shows that there is a reasonable possibility of causal connection between the accident and the disability. Porter v. Augenstein Construction Company, 280 So.2d 861 (La.App. 3 Cir. 1973); Bourque v. Monte Christo Drilling Corporation, 221 So.2d 604 (La.App. 3 Cir. 1969); Roberson v. Liberty Mutual Insurance Company, 316 So.2d 22 (La.App. 3 Cir. 1975).
In the instant suit, both of plaintiff's treating physicians felt that her disabling condition resulted from the accident which occurred in her home on December 25,1974, rather than from the accident which is alleged in the petition. That accident, of course, was not connected with her employment. Mrs. Broussard's symptoms of disc injury did not commence with the accident which occurred in September, 1974, and her first treating physician stated that the symptoms following the September accident were not compatible with an injury involving a ruptured disc. Under those circumstances we conclude that plaintiff is not entitled to the presumption that her disability resulted from the September accident.
The factual findings of the trial judge, and particularly those which involve a determination of the credibility of the witnesses, are entitled to great weight, and those findings will not be disturbed unless found to be clearly erroneous.
We find no error in the conclusion reached by the trial judge that there was no causal connection between the accident which occurred in August or September, 1974, and plaintiff's disabling condition. There thus is no error in the judgment which dismisses this suit.
For the reasons assigned, the judgment appealed from is affirmed. The cost of this appeal assessed to plaintiff-appellant.
AFFIRMED.
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Opinions of the United
2002 Decisions States Court of Appeals
for the Third Circuit
8-26-2002
Allegheny Ludlum v. NLRB
Precedential or Non-Precedential: Precedential
Docket No. 01-2338
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PRECEDENTIAL
Filed August 26, 2002
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 01-2338
ALLEGHENY LUDLUM CORPORATION,
Petitioner
v.
NATIONAL LABOR RELATIONS BOARD,
Respondent
* UNITED STEELWORKERS,
Intervenor
* (Per Clerk’s Order dated 6/21/01)
No. 01-4536
NATIONAL LABOR RELATIONS BOARD,
Petitioner
v.
ALLEGHENY LUDLUM CORPORATION,
Respondent
* UNITED STEELWORKERS,
Intervenor
* (Per Clerk’s Order dated 7/5/01)
On Petition for Review and Cross-Petition for Enforcement
of an Order of the National Labor Relations Board
(6-CA-26862)
Argued February 7, 2002
Before: SLOVITER and AMBRO, Circuit Judges,
and SHADUR, District Judge*
(Filed: August 26, 2002)
J. Anthony Messina
Vincent J. Pentima (Argued)
Klett Rooney Lieber & Schorling
Philadelphia, PA 19103
Attorneys for Allegheny
Ludlam Corporation
Arthur F. Rosenfeld
General Counsel
John E. Higgins, Jr.
Deputy General Counsel
John H. Ferguson
Associate General Counsel
Aileen A. Armstrong
Deputy Associate General Counsel
Robert J. Englehart
Supervisory Attorney
James M. Oleske, Jr. (Argued)
Attorney
National Labor Relations Board
Washington, D.C. 20570
Attorneys for National Labor
Relations Board
_________________________________________________________________
*Hon. Milton I. Shadur, United States Senior District Judge for the
Northern District of Illinois, sitting by designation.
2
Richard J. Brean (Argued)
Associate General Counsel
United Steelworkers of America
Pittsburgh, PA 15222
Attorney for Intervenor
United Steelworkers of America
OPINION OF THE COURT
SLOVITER, Circuit Judge.
Allegheny Ludlum Corporation petitions for review of the
decision of the National Labor Relations Board (NLRB or
"the Board") that Allegheny Ludlum committed an unfair
labor practice in soliciting employees to appear in an anti-
union campaign video. Following remand from the Court of
Appeals for the District of Columbia Circuit directing the
Board to articulate a clear standard that reconciled
employees’ rights to organize as protected by the Board’s
polling doctrine with employers’ free speech rights, the
Board filed a supplemental decision purporting to
announce such a standard. The Board concluded that
Allegheny Ludlum violated that standard when it solicited
employees to appear in an anti-union video. Allegheny
Ludlum filed a petition for review and the Board cross-
applied for enforcement of the order.
I.
A.
Facts
Allegheny Ludlum is a manufacturer of specialty steel
products in Western Pennsylvania. In July 1994, the United
Steelworkers of America ("the Union"), who already
represented Allegheny Ludlum’s production employees,
began organizing to represent its salaried, non-exempt
employees. On October 4, 1994, the Union filed an election
petition with the NLRB and an election was scheduled for
3
December 2, 1994. Prior to the election, Allegheny Ludlum
campaigned vigorously against the Union, employing
outside consultants to formulate an anti-union campaign
strategy.
In mid-November, Allegheny Ludlum began production of
a videotape for use in its anti-union campaign, seeking to
persuade its salaried employees to vote against the Union.
Allegheny Ludlum’s Manager of Communication Services,
Mark Ziemianski, personally supervised the filming by an
outside camera crew. The filming occurred on the premises
of the company over a period of three days. On the first
day, November 14, 1994, Ziemianski, accompanied by the
camera crew, approached several employees at their desks
and asked them if they would consent to be videotaped.
Those who agreed were instructed to sit at their desks, turn
to the camera, smile, and wave.
Although some employees filmed that day were given
advance written notice explaining that the video would be
used in the company’s election campaign and that they
could decline to participate, others were given no notice
until after they were filmed. The notice explained that
anyone who did not wish to appear in the video could
contact one of two company managers to be edited out of
the video. James Goralka, one of the employees who had
been filmed before seeing the notice, called Joyce Kurcina,
one of the two managers listed on the notice, and asked
that he and several of his co-workers be edited out of the
video. Kurcina instructed him to contact Ziemianski who
then informed Goralka that it would be "no problem" to
remove them from the tape but that Goralka needed to put
the request in writing listing the employees’ names who did
not wish to appear in the video. Goralka complied and he
and the listed co-workers were deleted from the video.
The filming continued on November 15 and 16. Unlike
the first day, Ziemianski prepared two written notices that
were distributed to employees in advance, either by
handing them out when the film crew entered work areas or
by interoffice mail. One notice stated:
Please be advised that a film crew will be in and
around your work areas filming footage for an
4
upcoming video presentation that the company will use
to present the facts about the current election
campaign involving the Steelworkers. If you prefer not
to be used in footage, please advise either Joyce
Kurcina . . . or Steve Spolar . . . as soon as possible.
We will be happy to accommodate your request.
App. at 122. Joyce Kurcina is Allegheny Ludlum’s Director
of Employee Relations and Steve Spolar is Allegheny
Ludlum’s Human Relations Counsel.
The other notice was identical in all material respects
except that it instructed employees to "advise the video
crew," rather than Kurcina or Spolar, if they did not want
to appear in the video. App. at 123. Ultimately, the
company filmed approximately eighty employees, or 17% of
the voting unit. Roughly thirty employees provided
Ziemianski with written requests to be excluded from the
video. Others declined to appear when approached by the
film crew or simply left the work area when the film crew
was present. In addition, a number of employees
complained to the Union about the filming and the Union
contacted Allegheny Ludlum to express its concern that the
taping was coercive. The filming continued and eventually
the employees were required to watch the finished video
during business hours.
The completed video contained testimony by employees
expressing their satisfaction with the status quo, their
dissatisfaction with union representation at prior employers
or in different units of Allegheny Ludlum, and their
discontent with the Union’s representation in particular.
Several employees noted that unionized segments of
Allegheny Ludlum had experienced layoffs, while a narrator
noted that nonunion employees had experienced no layoffs
since 1980. The video concluded with footage of employees
waving at the camera, accompanied by upbeat music
containing such lyrics as "Allegheny Ludlum is you and
me," and stating reasons to vote against union
representation.
Both the Union and Allegheny Ludlum employed
additional campaign strategies in the weeks preceding the
election. In the election, held on December 2, 1994, the
5
votes against union representation exceeded the votes in
favor, 237 to 225.
B.
Procedural Posture
Following the election, the Union filed charges with the
Board against Allegheny Ludlum alleging a number of
unfair labor practices and objectionable conduct. After a
hearing, the administrative law judge (ALJ) held that
Allegheny Ludlum violated section 8(a)(1) of the National
Labor Relations Act (NLRA), 29 U.S.C. S 158(a)(1) (2002), by
(1) unlawfully interrogating one employee about his union
support, disparaging employees because of their union
support, and impliedly threatening employees that support
for the Union would be futile; (2) threatening employees
with more onerous work conditions if they selected the
Union as their representative; (3) polling employees about
their union sentiments through the above-described
solicitation to appear in the video; (4) sending a newsletter
to employees impliedly threatening them with loss of jobs
and job security; and (5) threatening employees in a similar
manner through the comments of the chief executive
officer. Allegheny Ludlum Corp., 320 N.L.R.B. 484, 507
(1995). The ALJ also concluded that Allegheny Ludlum
violated sections 8(a)(1) and (3) of the NLRA, 29 U.S.C.
S 158(a)(1) and (3), by terminating an employee after the
election because of his union activity. Id. The ALJ directed
a second election and ordered Allegheny Ludlum to
reinstate the unlawfully discharged employee and make
him whole for any loss of wages or benefits, cease and
desist from its unlawful practices, and post a remedial
notice informing employees of their rights. Id. at 508. The
Board, with one member concurring in part and dissenting
in part, affirmed the ALJ’s rulings, findings, and
conclusions of law, and adopted its recommended order. Id.
at 484-85.
Allegheny Ludlum filed a petition for review in the United
States Court of Appeals for the District of Columbia Circuit
challenging the Board’s decision. That court enforced the
6
Board’s order except with respect to the solicitation of
employees to appear in the video. Allegheny Ludlum Corp.
v. NLRB, 104 F.3d 1354, 1358-64 (D.C. Cir. 1997). The
court noted the existence of a tension between an
employee’s right not to be subject to unlawful polling which
derives from section 8(a)(1) of the NLRA1 and an employer’s
right to free speech recognized in section 8(c) of the NLRA,2
and questioned "whether employers can ever legally include
visual images of employees in campaign materials without
running a heavy risk of later being found in violation of the
[NLRA] for illegally ‘polling’ their employees." Id. at 1358
(emphasis in original). Specifically, the court was troubled
by the interaction of cases finding "polling" unlawful and
the decision in Sony Corp. of America, 313 N.L.R.B. 420
(1993), which found that an employer violated section
8(a)(1) by videotaping its employees for use in an anti-union
presentation without obtaining the consent of those
employees. Concluding that resolution of the tension
required "determinations [which] are well suited to the
Board’s expertise and experience," the court remanded this
issue to the Board "for further consideration and the
articulation of a clearer Board policy as to how the
employers may lawfully proceed." Allegheny Ludlum Corp.,
104 F.3d at 1364.
After briefing by the parties, the Board filed a
Supplemental Decision and Order to address the issues
remanded by the Court of Appeals. Allegheny Ludlum Corp.,
333 N.L.R.B. No. 109, 2001 WL 855870 (Mar. 30, 2001).
The Board held that the remand required it to answer two
questions: (1) "whether an employer may lawfully ask
employees to participate in a campaign videotape and, if so,
_________________________________________________________________
1. Section 8(a)(1) provides:
(a) Unfair labor practices by employer
It shall be an unfair labor practice for an employer--
(1) to interfere with, restrain, or coerce employees in the
exercise of the rights guaranteed in section 157 of this title.
29 U.S.C. S 158(a)(1).
2. Section 8(c) protects the "expressing of any views, argument, or
opinion, or the dissemination thereof." 29 U.S.C.S 158(c).
7
under what circumstances such a request may be made;"
and (2) "in cases where an employer has not asked
employees, in advance, whether they wish to participate in
a campaign videotape . . . whether, and if so under what
circumstances, an employer may lawfully include images of
the employees in the videotape." Id. at *8. It is the first of
these questions that is relevant to this petition for review.
The Board looked for guidance to cases that have
examined employers’ distribution of anti-union
paraphernalia to employees. The Board explained that
those cases found violations of section 8(a)(1) where the
employer directly offered the anti-union paraphernalia to
employees, placing them in the "position of having to accept
or reject the [employer’s] proffer, thereby disclosing their
preference for or against the union." Id. (citing A.O. Smith
Auto. Prods. Co., 315 N.L.R.B. 994 (1994)); see also Barton
Nelson, Inc., 318 N.L.R.B. 712, 712-13 (1995); Kurz-Kasch,
Inc., 239 N.L.R.B. 1044, 1047 (1978). The Board noted that
in contrast no violation was found in cases in which an
employer made anti-union paraphernalia available from a
central location absent any evidence of employer pressure
to reveal a preference. Allegheny Ludlum, 2001 WL 855870,
at *9 (citing Schwartz Mfg. Co., 289 N.L.R.B. 874 (1988);
Jefferson Stores, Inc., 201 N.L.R.B. 672 (1973)). From these
cases, the Board devised the standard that an employer
may lawfully solicit employees to appear in a campaign
video provided the employer meets the following five
requirements:
1. The solicitation is in the form of a general
announcement which discloses that the purpose of the
filming is to use the employee’s picture in a campaign
video, and includes assurances that participation is
voluntary, that nonparticipation will not result in
reprisals, and that participation will not result in
rewards or benefits.
2. Employees are not pressured into making the
decision in the presence of a supervisor or. [sic]
3. There is no other coercive conduct connected with
the employer’s announcement such as threats of
reprisal or grants or promises of benefits to employees
who participate in the video.
8
4. The employer has not created a coercive atmosphere
by engaging in serious or pervasive unfair labor
practices or other comparable coercive conduct.
5. The employer does not exceed the legitimate purpose
of soliciting consent by seeking information concerning
union matters or otherwise interfering with the
statutory rights of employees.
Id. at *13.
In applying these requirements to the instant case, the
Board found that Allegheny Ludlum violated section 8(a)(1)
"by approaching individual employees and asking them to
consent to be filmed for the purpose of a campaign
videotape, and by requiring employees to register an
objection with an agent of [Allegheny Ludlum] in order to
avoid being including in its campaign videotape." Id. at *16.
The Board noted that Allegheny Ludlum violated the first
requirement by not using a general announcement and
forcing "employees ‘to make an observable choice that
demonstrates their support for or rejection of the union.’ "
Id. (quoting Barton Nelson, Inc., 318 N.L.R.B. at 712).
Additionally, the Board found that Allegheny Ludlum failed
to give the employees the required assurances that there
would be no reprisals for non-participation or benefits for
participation and that Allegheny Ludlum committed other
unfair labor practices, creating "an atmosphere which
would reasonably tend to coerce employees into agreeing to
participate in the videotape." Id.
Allegheny Ludlum petitions for review of this decision on
several grounds. First, it contends that its efforts to obtain
employee consent to videotaping did not constitute a"poll."
Second, it argues that the Board’s five requirements are
"arbitrary, irrational and violate an employer’s free speech
rights . . . as well as the Board’s obligation to maintain
neutrality." Br. of Allegheny Ludlum at 3. Third, it argues
that the Board improperly applied its new requirements
retroactively to this case. Finally, Allegheny Ludlum
contends that the Board erred in finding that its efforts
violated the articulated requirements. The Board cross
applies for enforcement of the order.
9
The United Steelworkers of America filed a brief as an
intervenor on the side of the Board.
II.
JURISDICTION AND STANDARD OF REVIEW
A.
Jurisdiction
The Board had jurisdiction under 29 U.S.C. S 160(a),
which authorizes the Board to prevent unfair labor
practices. We have jurisdiction to review a decision of the
Board pursuant to 29 U.S.C. S 160(e) and (f).
B.
Standard of Review
We must "defer to the requirements imposed by the
Board if they are rational and consistent with the[National
Labor Relations] Act, and if the Board’s explication is not
inadequate, irrational or arbitrary." Allentown Mack Sales &
Serv., Inc. v. NLRB, 522 U.S. 359, 364 (1998) (quotations
and citations omitted). "Familiar principles of judicial
deference to an administrative agency apply to the NLRB’s
interpretation of the NLRA." Quick v. NLRB , 245 F.3d 231,
240-41 (3d Cir. 2001) (citing Holly Farms Corp. v. NLRB,
517 U.S. 392, 398-99 (1996)). We must uphold the"NLRB’s
construction of the NLRA . . . if it is ‘reasonably
defensible.’ " Id. at 241 (quoting Ford Motor Co. v. NLRB,
441 U.S. 488, 497 (1979)). Our standard of review is
governed by the test articulated in Chevron U.S.A. Inc. v.
Natural Resources Defense Council, Inc., 467 U.S. 837
(1984). See Stardyne, Inc. v. NLRB, 41 F.3d 141, 147 (3d
Cir. 1994) (noting that under Chevron, " ‘if the statute is
silent or ambiguous with respect to the specific issue, the
question for the court is whether the agency’s answer is
based on a permissible construction of the statute’ ")
(quoting Chevron, 467 U.S. at 843).
10
When reviewing the Board’s determination in a particular
case, this court must "accept the Board’s factual
determinations and reasonable inferences derived from
[those] determinations if they are supported by substantial
evidence." Stardyne, 41 F.3d at 151; see also 29 U.S.C.
S 160(e), (f). We must uphold a Board decision"as long as
it is rational and consistent with the Act, even if we would
have formulated a different rule had we sat on the Board."
NLRB v. Curtin Matheson Scientific, Inc., 494 U.S. 775, 787
(1990) (citations omitted). Thus, we give deference to the
Board’s decision in this case unless we conclude it is
irrational, arbitrary, or unsupported by substantial
evidence.
III.
DISCUSSION
A.
Polling
Allegheny Ludlum argues that the Board’s ultimate
conclusion was faulty because the Board proceeded on the
inaccurate premise that Allegheny Ludlum’s attempts to
videotape employees constituted a "poll." The Board has
previously held that "any attempt by an employer to
ascertain employee views and sympathies regarding
unionism generally tends to cause fear of reprisal in the
mind of the employee if he replies in favor of unionism and,
therefore, tends to impinge on his Section 7 [29 U.S.C.
S 157] rights." Struksnes Constr. Co., 165 N.L.R.B. 1062,
1062 (1967). Under section 8(a)(1) of the NLRA, it is an
unfair labor practice for an employer "to interfere with,
restrain, or coerce employees in the exercise of the rights
guaranteed in section 157 of this title," 29 U.S.C.
S 158(a)(1), which include, inter alia, the rights to self-
organization and collective bargaining, and the
corresponding right to refrain from such activities. 29
U.S.C. S 157. It has long been the Board’s position that an
employer may violate section 8(a)(1) if it attempts to discern
11
the union sentiments of its employees. See, e.g. , Struksnes,
165 N.L.R.B. at 1063 & n.18 (collecting cases).
As the D.C. Circuit noted in this case, the "kind of
employer actions [that] constitute a ‘poll’ does not depend
on their formal nomenclature; the key is their practical
effect of tending to instill in employees a reasonable belief
that the employer is trying to find out whether they support
or oppose the union." Allegheny Ludlum Corp. v. NLRB, 104
F.3d 1354, 1360 (D.C. Cir. 1997). This happens whenever
"the employees are forced to make an observable choice
that demonstrates their support for or rejection of the
union." Barton Nelson, Inc., 318 N.L.R.B. 712, 712 (1995).
Allegheny Ludlum argues that its actions did not
constitute a "poll" because its purpose in seeking to
videotape its employees was not to discern their views
toward the union. However, subjective intent is not an
element of the definition of "polling." As the D.C. Circuit
observed,
We note that whether this consent solicitation would
constitute an unlawful interference with S 7 rights does
not turn on the malevolence or innocence of the
employer’s intent in seeking the employees’ consent;
rather the relevant question is whether the solicitations
would tend to create among the employees a
reasonable impression that the employer was trying to
discern their union sentiments.
Allegheny Ludlum, 104 F.3d at 1362 (emphasis in original).
In other words, the test is an objective test in which the
employer’s intent is irrelevant and the proper inquiry is the
impression of a reasonable employee.
Moreover, the inquiry is also objective as to the effect on
employees. Whether a particular employee opted not to
participate in the company’s videotape for reasons of union
loyalty or for wholly unrelated reasons is irrelevant because
the inquiry focuses on whether the solicitations would "tend
to create" an impression that the company was trying to
discern union sentiments, not whether they actually
created such an impression. See, e.g., Graham Architectural
Prods. Corp. v. NLRB, 697 F.2d 534, 537-38 (3d Cir. 1983);
NLRB v. Garry Mfg. Co., 630 F.2d 934, 938 (3d Cir. 1980).
12
Allegheny Ludlum contends that this case is like cases in
which the Board decided that the conduct of the employer
did not constitute a "poll" despite the employer’s
distribution of anti-union paraphernalia. However, the
cases cited by Allegheny Ludlum differ as they involve
instances in which an employer made anti-union
paraphernalia available at a central location or made it
available for sale to the employees upon the employees’
initiative. See Holsum Bakers of P. R., Inc., 320 N.L.R.B.
834, 839 (1996) (finding no coercive conduct where
employer made anti-union stickers available to employees
without any supervisory involvement or evidence of
observable choice); Okla. Installation Co., 309 N.L.R.B. 776,
776 (1992) (finding no coercive conduct where employer
provided all employees with caps and t-shirts bearing
company logo along with anti-union letter), overruled on
other grounds by 27 F.3d 567 (6th Cir. 1994); Daniel
Constr. Co., 266 N.L.R.B. 1090, 1099-10 (1983) (finding no
coercion where employer made jackets with company logo
available for sale because the employees first expressed
interest in the jackets and the jackets had been sold before
the union drive began).
This case more closely resembles those cases in which
the Board found an unlawful poll because the employees
were forced to make an observable choice about their union
sympathies. See, e.g., Barton Nelson, 318 N.L.R.B. at 712
(finding it coercive for supervisors to hand out anti-union
hats to employees because it forced the employees to make
an observable choice). Thus, the Board did not err in
considering this case under its "polling" precedent.
B.
Board’s Requirements
Allegheny Ludlum argues that the standard set forth by
the Board is arbitrary and irrational because it violates an
employer’s free speech rights and renders it virtually
impossible for an employer to create a videotape for use in
an anti-union campaign. Allegheny Ludlum notes that the
NLRA protects employer speech so long as that speech does
13
not threaten reprisal for supporting unionization or promise
some benefit for rejecting unionization, and contends that
its speech is protected because it did neither. The statutory
provision on which it relies, section 8(c), provides:
The expressing of any views, argument, or opinion, or
the dissemination thereof, whether in written, printed,
graphic, or visual form, shall not constitute or be
evidence of an unfair labor practice under any of the
provisions of this subchapter, if such expression
contains no threat of reprisal or force or promise of
benefit.
29 U.S.C. S 158(c). This section implements employers’ First
Amendment rights under the Constitution. See, e.g., NLRB
v. Gissel Packing Co., 395 U.S. 575, 617 (1969) (holding
S 158(c) "merely implements the First Amendment").
However, as the D.C. Circuit noted in remanding this case,
" ‘[a]ny assessment of the precise scope of employer
expression . . . must be made in the context of its labor
relations setting,’ and . . . ‘an employer’s rights cannot
outweigh the equal rights of the employees to associate
freely.’ " Allegheny Ludlum, 104 F.3d at 1361 (alterations in
original) (quoting Gissel, 395 U.S. at 617). As the Gissel
Court explained, "any balancing of those rights must take
into account the economic dependence of the employees on
their employers, and the necessary tendency of the former,
because of that relationship, to pick up intended
implications of the latter that might be more readily
dismissed by a more disinterested ear." Gissel, 395 U.S. at
617.
Employer "polling" is not expression protected by section
8(c). See Struksnes, 165 N.L.R.B. at 1062 n.8 ("It is well
established that an employer, in questioning his employees
as to their union sympathies, is not expressing views,
argument, or opinion within the meaning of Section 8(c) of
the [NLRA], as the purpose of an inquiry is not to express
views but to ascertain those of the person questioned."); see
also Allegheny Ludlum, 104 F.3d at 1361 (quoting same).
Although the statute does not forbid employer speech
unaccompanied by threats of reprisal or promise of
benefits, employer "polling" is defined by its"tendency to
‘cause fear of reprisal in the mind of the employee.’ " Hajoca
14
Corp. v. NLRB, 872 F.2d 1169, 1173 (3d Cir. 1989) (quoting
Struksnes, 165 N.L.R.B. at 1062).
Allegheny Ludlum contends that the Board’s decision in
this case conflicts with our earlier decision in Graham
Architectural Products Corp. v. NLRB, 697 F.2d 534 (3d Cir.
1983), where we held that casual questions regarding
unionization by supervisors, who often work closely with
employees and may be expected to "discuss a range of
subjects of mutual interest," are not necessarily coercive.
Id. at 541. In that case, we found instances of casual
questioning did not violate section 8(c) where the inquiries
were not "part of a full scale ‘anti-union campaign
orchestrated by the highest levels of . . . management.’ " Id.
at 540 (alterations in original) (quoting Ethyl Corp., 231
N.L.R.B. 431, 433 (1977)). We added that "it is important to
bear in mind that there was no history of Company hostility
to the Union." Id. at 539.
These facts stand in stark contrast to those in this case
in which there was a vigorous anti-union campaign
underway at the time of the challenged inquiries.
Ziemianski did not work closely with the questioned
employees, and hence was not likely to engage in casual
conversation with them. Therefore, his requests to
videotape the employees do not fall within the "realities of
the workplace" that were prevalent in Graham , 697 F.2d at
541. The facts of this case are more closely aligned with the
direct solicitations in the paraphernalia cases than the
casual conversations in Graham.
We conclude that the Board’s decision is a rational
resolution of the tension between the employer’s First
Amendment rights and the employee’s right to organize
freely. In responding to the D.C. Circuit’s remand, the
Board exercised its "authority to formulate rules to fill the
interstices of the [NLRA’s] broad statutory provisions."
NLRB v. Curtin Matheson Scientific, Inc., 494 U.S. 775, 786
(1990) (quotation omitted). The Board’s five-factor test both
protects employees from direct solicitations by employers
and allows employers to create anti-union campaign videos
within the constraints of Sony.
The first requirement -- that solicitations come in the
form of a general announcement that discloses the
15
purposes of the filming and assures that participation is
voluntary and will not result in reprisals or rewards -- is
derived directly from the paraphernalia cases, which have
held acceptable the distribution of anti-union paraphernalia
from a central location, but not individualized inquiries that
require an employee to make an observable choice. See,
e.g., Barton Nelson, 318 N.L.R.B. at 712. The second
requirement -- that employees not be pressured into
making a decision in the presence of a supervisor-- echoes
this concern that employees not be forced to make
observable choices. The final three requirements simply
reflect prohibitions against conduct that independently
violates the NLRA. See generally 29 U.S.C.S 158. In fact,
the Board recognized its need to be even more protective in
the videotaping context than in the paraphernalia cases
because an employee who changes his or her views on
unionization may simply remove an anti-union button or
hat without notifying the employer, whereas a video creates
a permanent record unless an employee openly declares to
the employer his or her desire to be removed from the
video. Allegheny Ludlum, 2001 WL 855870, at *12.
Allegheny Ludlum contends that the five-factor test is
unduly burdensome because it effectively eliminates an
employer’s ability to videotape employees in the workplace
during an election campaign. This contention considerably
overstates the prohibition. As the Board’s decision clearly
states, an employer may make a general announcement
regarding its desire to videotape employees for use in a
campaign video and subsequently, videotape anyone who
comes forward, as long as it makes the necessary
assurances.3 These guidelines do not make it "virtually
_________________________________________________________________
3. The D.C. Circuit suggested in dictum that an employer would not
violate the polling doctrine by soliciting employees to appear in anti-
union videos if the employer sought "to include only those employees
who have on their own initiative clearly expressed opposition to union
representation." Allegheny Ludlum, 104 F.3d at 1363-64. The Board
disagrees, explaining that an employee has the "right to choose, free
from any employer coercion, the degree to which he or she will
participate in the debate concerning representation." Allegheny Ludlum,
2001 WL 855870, at *10. Because the company in this case solicited
employees indiscriminately and did not limit its solicitation to employees
who were known union opponents, we do not reach to decide an issue
not presented under the facts before us.
16
impossible for an employer to videotape its employees in
the workplace during the campaign effort" as Allegheny
Ludlum contends, Br. of Allegheny Ludlum at 44, nor has
Allegheny Ludlum shown why a general announcement is
"simply not an effective means" for securing participants.
Reply Br. at 12. Rather, the Board’s requirements allow an
employer to videotape its employees, while at the same time
barring the employer from placing an employee in the
position of having to express openly a willingness or
unwillingness to appear in an anti-union video. The Board’s
decision is consistent with the purposes of the NLRA and
reasonably balances the rights created under sections
8(a)(1) and 8(c). Thus, we defer to the Board’s
accommodation of the competing interests. See Stardyne,
Inc. v. NLRB, 41 F.3d 141, 147-48 (3d Cir. 1994) (deferring
to Board’s balancing of competing employer and employee
interests where that balancing was a "permissible
construction of the Act").4
C.
Retroactivity
As we have no basis to reject the standard set forth by
the Board governing the employer’s solicitation of
_________________________________________________________________
4. Allegheny Ludlum argues that the Board’s decision violates an
apparent mandate to maintain neutrality created in NLRB v. Savair
Manufacturing Co., 414 U.S. 270 (1973). It contends that Savair created
an obligation of neutrality in enforcing the NLRA that "prevents the
Board from allowing a union to film employees while denying the same
medium to an employer." Br. of Allegheny Ludlum at 41. We need not
reach the merits of this argument because Allegheny Ludlum did not
raise this issue before the Board as required by the NLRA. 29 U.S.C.
S 160(e), (f). Although Allegheny Ludlum raised this issue before the D.C.
Circuit, we have interpreted this rule strictly to require a party at least
to " ‘object[ ] to the Board’s decision in a petition for reconsideration or
rehearing’ " before the Board. NLRB v. Konig, 79 F.3d 354, 359 (3d Cir.
1996) (quoting Woelke & Romero Framing, Inc. v. NLRB, 456 U.S. 645,
666 (1982)). In any event, the D.C. Circuit’s remand was limited to
devising "clear guidelines as to how to proceed in regard to company
videotaping of employees." 104 F.3d at 1363. The Board was not under
direction to consider union videotaping.
17
employees to appear in anti-union campaigns, we turn to
Allegheny Ludlum’s challenge to what it terms the
retroactive application of that standard to its case. We must
first consider the argument made by both the Board and
the Union that Allegheny Ludlum’s failure to raise its
retroactivity argument before the Board bars it from raising
that claim before this court. They point to section 10(e) of
the NLRA, 29 U.S.C. S 160(e), which states,"No objection
that has not been urged before the Board, its member,
agent, or agency, shall be considered by the court, unless
the failure or neglect to urge such objection shall be
excused because of extraordinary circumstances."
Allegheny Ludlum made no objection on grounds of
retroactivity before the Board despite its opportunity to do
so in its Statement of Position before the Board or in a
motion for reconsideration. See Konig, 79 F.3d at 360
(finding "failure to raise the argument, and . . . failure to
file a petition for reconsideration, deprives this court of
jurisdiction to address this question under section 10(e) of
the NLRA").
However, as Allegheny Ludlum correctly notes, a number
of courts of appeals have permitted parties to raise
retroactivity arguments despite the parties’ failure to raise
the issue before the Board. See, e.g., Ryan Heating Co. v.
NLRB, 942 F.2d 1287, 1288 (8th Cir. 1991); Oil, Chem. &
Atomic Workers Int’l Union, Local 1-547 v. NLRB, 842 F.2d
1141, 1144 n.2 (9th Cir. 1988); NLRB v. Wayne Transp.,
776 F.2d 745, 749-50 (7th Cir. 1985); Local 900, Int’l Union
of Elec. Workers v. NLRB, 727 F.2d 1184, 1190-94 (D.C.
Cir. 1984). Those courts noted that the purpose of section
10(e) is to ensure that the Board had notice of all issues
within its jurisdiction and to prevent repetitive appeals.
See, e.g., Wayne Transp., 776 F.2d at 749. Thus, when it
was clear that the putatively foreclosed party objected to
the new pronouncements by the Board, the courts held that
the Board was on notice, explaining that "[r]etroactivity is
necessarily an issue any time adjudication results in a new
rule of law." Local 900, 727 F.2d at 1193-94.
The Board and the Union respond that these cases are
inapplicable because they involve situations where the
objecting party was successful before the ALJ under an
18
existing standard and then lost before the Board under a
newly adopted standard. Therefore, the courts in those
cases concluded that the petitioners implicitly raised the
issue of retroactivity by virtue of their argument that the
old standard should apply. In this case, Allegheny Ludlum,
which was unsuccessful before the ALJ, was in favor of the
articulation of a new rule and actively participated in the
debate before the Board with respect to the drafting of a
new standard. It was therefore not surprised by the
articulation of a new standard, and should not have been
surprised that the standard was applied to it.
However, we need not decide this issue because even if
Allegheny Ludlum’s retroactivity argument survives its
failure to comply with section 10(e), its argument fails on
the merits. We must defer to agency retroactivity rulings
unless the ruling creates "manifest injustice." Laborers’ Int’l
Union v. Foster Wheeler Corp., 26 F.3d 375, 390-92 (3d Cir.
1994); Int’l Assoc. of Bridge, Structural & Ornamental Iron
Workers, Local 3 v. NLRB, 843 F.2d 770, 780-81 (3d Cir.
1988). The factors for determining whether retroactive
application of a Board decision creates a manifest injustice
are " ‘(1) whether the particular case is one of first
impression, (2) whether the new rule represents an abrupt
departure from well established practice or merely occupies
a void in an unsettled area of law, (3) the extent to which
the party against whom the new holding is applied in fact
relied on the former rule, (4) the degree of the burden
imposed, and (5) the statutory interest in application of this
new rule.’ " Laborers’ Int’l Union, 26 F.3d at 392 (quoting
E.I. Wiegand Div. v. NLRB, 650 F.2d 463, 471 n.5 (3d Cir.
1981)).
Where the case is one of first impression, the court
"would be compelled either to apply the new rule
retrospectively or to reject it, as the prohibition against
advisory opinions assures that ‘[e]very case of first
impression has a retroactive effect.’ " Id. (citations omitted)
(alteration in original) (quoting SEC v. Chenery Corp., 332
U.S. 194, 203 (1947)). As the D.C. Circuit made clear, the
Board confronted a conflict between two doctrines, and
thus the resulting synthesis was clearly a new rule,
fulfilling the first criterion in favor of retroactive application.
19
Second, the case is not an abrupt departure from well
established practice. Although the D.C. Circuit suggested
an employer might infer that under Sony it was justified in
soliciting the consent of employees, the D.C. Circuit also
recognized that no well established practice existed in this
area of the law when it stated that it was "confused and
troubled by the sharply inconsistent approaches that the
Board’s ALJs have taken to the convergence of issues
presented by post-Sony videotaping of employees."
Allegheny Ludlum, 104 F.3d at 1363. The remand
specifically asked the Board to fill a void in an unsettled
area of the law satisfying the second criterion.
Third, there is no indication that Allegheny Ludlum relied
on Sony for its conduct. Not until this petition for review
did Allegheny Ludlum argue it relied on Sony. The Board
found that "there [is] no evidence that[Allegheny Ludlum]
had relied on Sony in structuring its antiunion
videotaping." Allegheny Ludlum, 2001 WL 855870, at *3.
Fourth, the degree of burden imposed is not high. In
Laborers’ International Union, we explained that this inquiry
examines the monetary liability to the party and the party’s
ability to pay. 26 F.3d at 393. Although this factor need not
be limited to financial burdens, the burden imposed on
Allegheny Ludlum is not great. Unlike the situation in
Laborers’ International Union, Allegheny Ludlum suffers no
direct financial penalty. The sole burden created by the
Board in this case is its order requiring Allegheny Ludlum
to follow the new rule during any future campaign and to
post a remedial notice.
Fifth, the statutory interest in the application of the new
rule appears high. A rerun election has already been
ordered by the Board based on other unfair labor practices.
The new election thus may again implicate the same
controversy. Retroactive application ensures the existence
of an order that would prevent the company from engaging
in the same conduct in the future. In Laborers’ International
Union, we concluded that there was a great statutory
interest in the retroactive application of a new rule "even
. . . where the dispute was purely of historical interest." Id.
at 392.
20
This court has previously observed the "truism that in
the context of adjudication, retrospectivity is, and has since
the birth of this nation been, the norm." Id. at 394. In
Laborers’ International Union, we concluded that the Board
rule would be applied retroactively even though"the first
and fourth factors favor neither party, . . . the third and
fifth factors militate in favor of the Union, and . . . the
second factor favors the defendants." Id. at 392. Because
the factors overwhelmingly favor retroactive application of
the Board’s new standard in this case, Allegheny Ludlum’s
argument fails.
D.
Substantial Evidence
Finally, Allegheny Ludlum argues that the Board’s
application of its new rule to this case is not supported by
substantial evidence. As we stated at the outset, we must
uphold the Board’s factual findings as "conclusive if
supported by substantial evidence on the record as a
whole." Quick v. NLRB, 245 F.3d 231, 240 (3d Cir. 2001).
"Substantial evidence is ‘more than a mere scintilla. It
means such relevant evidence as a reasonable mind might
accept as adequate to support a conclusion.’ " Citizens
Publ’g & Printing Co. v. NLRB, 263 F.3d 224, 232 (3d Cir.
2001) (alterations in original) (quoting Universal Camera
Corp. v. NLRB, 340 U.S. 474, 477 (1951)).
The Board applied the five requirements of its newly
articulated standard to the facts of this case and concluded
that Allegheny Ludlum’s method of soliciting participants
for its anti-union video was inconsistent with the
requirements and thus, violated section 8(a)(1). We agree.
It is clear that directly soliciting individual employees
does not meet the requirement that the "solicitation come
as a general announcement." There was ample evidence to
support the Board’s finding that many employees"were
subjected to requests to participate, which were
coordinated by the Respondent’s Manager of
Communications." Allegheny Ludlum, 2001 WL 855870, at
*16 (footnote omitted). On the first day, Ziemianski himself
21
approached individual employees, handed them a notice,
and asked them directly if they would appear in the video.
The notices were not in the form of a general
announcement nor did they include assurances that
participation was voluntary and would result in no benefits
or reprisals, as required. Although the notices stated that
the company would accommodate requests not to be
included, that does not meet the required level of
assurances regarding the consequences of that choice.
Finally, the Board found that Allegheny Ludlum had
committed a number of other unfair labor practices,
including "threats of job loss and layoffs and the
discriminatory discharge of a leading union activist,
creat[ing] an atmosphere which would reasonably tend to
coerce employees into agreeing to participate in the
videotape." Id. Allegheny Ludlum argues that the four
unfair labor practices found by the Board are not relevant
to this case and that one occurred after the filming and
election. However, even if we disregard the practice that
occurred after the election, the Board’s finding that the
company engaged in a number of unfair labor practices, in
violation of the fourth requirement, is based on the record.
In order to meet the requirements set forth by the Board,
an employer’s solicitation of its employees to appear in an
anti-union video must satisfy all five requirements. Because
substantial evidence supports the Board’s finding that
Allegheny Ludlum failed to satisfy at least some of the
requirements, we must uphold the Board’s determination
that Allegheny Ludlum violated section 8(a)(1).
IV.
CONCLUSION
For the reasons set forth, we will deny Allegheny
Ludlum’s Petition for Review and grant the Board’s
Application for Enforcement.
22
A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit
23
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} |
186 F.Supp.2d 798 (2002)
GEIER BROTHERS FARMS, et al., Plaintiff,
v.
FURST-MCNESS COMPANY, et al., Defendant.
No. 3:00CV7599.
United States District Court, N.D. Ohio, Western Division.
February 22, 2002.
*799 *800 Benjamin F. Yale, Law Office of Benjamin F. Yale, Waynesfield, OH, Kristine H. Reed, Benjamin F. Yale & Associates, Waynesfield, OH, for Geier Brothers Farms, plaintiff.
Benjamin F. Yale, Kristine H. Reed, (see above for address), for Marvin Geier, plaintiff.
Benjamin F. Yale, Kristine H. Reed, (see above for address), for Gerald Geier, plaintiff.
Benjamin F. Yale, Kristine H. Reed, (see above for address), for Mary Geier, plaintiff.
Benjamin F. Yale, Kristine H. Reed, (see above for address), for Nancy Geier, plaintiff.
Julie L. Juergens, Gallagher, Sharp, Fulton & Norman, Cleveland, OH, Paul J Schumacher, Jr., Gallagher, Sharp, Fulton & Norman, Cleveland, OH, Virginia L. Heidloff, Gallagher, Sharp, Fulton & Norman, Cleveland, OH, for Furst-McNess Company, defendant.
David C. Nalley, Murphy & Lyons, Covington, KY, Kevin L Murphy, Murphy & Lyons, Covington, KY, Theodore M. Rowen, Spengler Nathanson, Toledo, OH, for Griffin Industries, Inc., defendant.
MEMORANDUM OPINION
KATZ, District Judge.
This matter is before the Court on Defendants' motions for summary judgment (Doc. Nos. 44 & 46) and Defendants' motion for reconsideration (Doc. No. 90). Jurisdiction in this Court is proper pursuant to 28 U.S.C. § 1332. For the following reasons, the motions for summary judgment will be granted in part and denied in part, and the motion for reconsideration will be denied.
BACKGROUND
Plaintiff Geier Brothers Farms ("Geier Brothers") is a multi-commodity farming operation and general partnership located in Mercer County, Ohio.[1] Although Geier Brothers included a hog operation and a grain operation, its primary business was a dairy farming operation. In October 1998, Geier Brothers had a "milking herd" of about 100 cows. Geier Brothers generally placed their herd on a special diet designed to maximize milk production. The diet included products derived from Geier Brothers' own hog and grain operations and a third-party nutritional supplement.
Defendant Griffin Industries, Inc. ("Griffin"), is located in Cold Spring, Kentucky. Griffin is a rendering operation that manufactures fertilizers, animal feeds, and animal feed supplements. One of the feed supplements manufactured by Griffin is Pro Blend M 250000 ("Pro Blend"), a protein supplement for dairy cattle that is custom-blended by Griffin for Defendant Furst-McNess Company ("Furst-McNess"), an Illinois corporation. Furst-McNess marketed the Pro Blend to Geier Brothers.
Geier Brothers began to include Pro Blend in their feed mixtures in January 1998. Although Geier Brothers does not claim that its herd experienced any unexplained deaths during the adoption of the Pro Blend, it does claim that milk production decreased.
On June 16, 1998, Griffin manufactured Pro Blend Lot 7223. Lot 7223 was delivered to Geier Brothers in September 1998. Included with bags of Pro Blend labeled *801 "Lot 7223" were three unlabeled bags that Geier Brothers presumed also contained Pro Blend. The Pro Blend was combined with silage from the Geier Brother's grain operation in a ratio computed for Geier Brothers by Furst-McNess. Geier Brothers began feeding the resulting feed ration to its dairy herd on October 1, 1998.
Geier Brothers claims that about two weeks after the feed mixture containing Lot 7223 was introduced some of the herd ate less feed, and some stopped eating altogether. Those animals that stopped eating "went down," and as a result they either died on the farm or were "culled." Culled cows were sold at less then fifteen percent of their normal worth to Mr. Chops May (not a party) who delivered them to slaughterhouses or rendering plants. Between October 1998, and January 1999, thirty of Geier Brothers' dairy cows died.
Geier Brothers alleges that the deaths were caused by problems with the Pro Blend in the feed mixture. It claims that Lot 7223 was unfit because it contained evidence of contamination by both salmonella and small metal particles, and because it was discolored, smelly, and unpalatable to the herd.
Geier Brothers brought the instant action on September 27, 2000, and filed an amended complaint on June 28, 2001. Geier Brother's amended complaint contains the following causes of action:
1. Violation of the Lanham Act, 15 U.S.C. § 1125
2. Breach of Implied Warranty
3. Breach of Express Warranty
4. Negligent Preparation and Handling of Feed
5. Negligent Preparation and Recommendation of Feed Ration
6. Intentional Misrepresentation
7. Negligent Misrepresentation
8. Fraud (against Furst-McNess, for sale of a product containing salmonella)
9. Fraud (against Griffin, for sale of an expired product)
10. Mislabeling
11. Failure to Label
12. Violation of Ohio's Animal Feed Laws, Chapter 923 of the Ohio Revised Code.
Both Furst-McNess and Griffin filed a motion for summary judgment, and Geier Brothers filed a response. Prior to the filing of a reply by either Furst-McNess or Griffin, Geier Brothers filed a motion for leave to file an affidavit from expert Walter Guterbock. The motion for leave was granted by marginal entry order and without further briefing. The Defendants subsequently filed both their replies in support of summary judgment and a motion for reconsideration of the grant of leave to file the Guterbock affidavit. Both the motions for summary judgment and the motion for reconsideration are discussed below.
Discussion
I. Motion for Reconsideration
A. Standard
Although a motion for reconsideration is not mentioned in the Federal Rules of Civil Procedure, it is often treated as a motion made under Rule 59(e). McDowell v. Dynamics Corp. of America, 931 F.2d 380 (6th Cir.1991); Shivers v. Grubbs, 747 F.Supp. 434 (S.D.Ohio 1990). The purpose of a motion to alter or amend judgment under Fed.R.Civ.P. 59(e) is to have the court reconsider matters "properly encompassed in a decision on the merits." Osterneck v. Ernst and Whinney, 489 U.S. 169, 174, 109 S.Ct. 987, 103 L.Ed.2d 146 (1989). This rule gives the district court the "power to rectify its own *802 mistakes in the period immediately following the entry of judgment." White v. New Hampshire Dept. of Employment Security, 455 U.S. 445, 450, 102 S.Ct. 1162, 71 L.Ed.2d 325 (1982). Generally, there are three major situations which justify a district court altering or amending its judgment: "(1) to accommodate an intervening change in controlling law; (2) to account for new evidence not available at trial; or (3) to correct a clear error of law or to prevent a manifest injustice." In re Continental Holdings, Inc., 170 B.R. 919, 933 (Bankr.N.D.Ohio 1994); Braun v. Champion Credit Union, 141 B.R. 144, 146 (Bankr.N.D.Ohio 1992), aff'd, 152 B.R. 466 (N.D.Ohio 1993); In re Oak Brook Apartments of Henrico County, Ltd., 126 B.R. 535, 536 (Bankr.S.D.Ohio 1991).
B. Argument
Here, Defendants argue that the motion for leave to file the supplemental affidavit of Dr. Guterbock should have been denied because the information therein contradicts testimony given in his prior deposition, and because the motion for leave was filed only one day before the replies in support of summary judgment were due. The Defendants also claim that they are entitled to reasonable fees and expenses related to the affidavit pursuant to Fed.R.Civ.P. 56(g), because the affidavit was submitted in bad faith and for the purposes of delay.
In its response to the motion for reconsideration, Geier Brothers argues that the filing of the affidavit was not untimely. Geier also points out a number of ways in which the Guterbock affidavit does not contradict his earlier deposition testimony.
It is well-established that a party may not create a disputed issue of material fact by submitting an affidavit that contradicts earlier deposition testimony. See Dotson v. United States Postal Serv., 977 F.2d 976, 978 (6th Cir.1992); Laise v. City of Utica, 970 F.Supp. 605, 610 (E.D.Mich. 1997) (collecting cases). With this rule in mind, it is not necessary for the Court to grant Defendants' motion for reconsideration. Although some portions of the Guterbock affidavit may duplicate or even contradict testimony elicited in his deposition, other portions do not. Because the Court is capable of disregarding those parts of the affidavit that are not relevant to the decision on the motions for summary judgment, there is no need to grant the motion for reconsideration and strike the affidavit. Furthermore, because there has been no evidence of bad faith or delay, no fees or expenses will be awarded to the Defendants. The motion for reconsideration will be denied.
II. Motion for Summary Judgment
A. Standard
Summary judgment must be entered "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). Of course, the moving party always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any," which it believes demonstrate the absence of a genuine issue of material fact. Id. at 323, 106 S.Ct. at 2553. The burden then shifts to the nonmoving party who "must set forth specific facts showing that there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 2514, 91 L.Ed.2d 202 (1986) (quoting Fed.R.Civ.P. 56(e)).
*803 Once the burden of production has so shifted, the party opposing summary judgment cannot rest on its pleadings or merely reassert its previous allegations. It is not sufficient "simply [to] show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986). Rather, Rule 56(e) "requires the nonmoving party to go beyond the [unverified] pleadings" and present some type of evidentiary material in support of its position. Celotex, 477 U.S. at 324, 106 S.Ct. at 2553. Summary judgment shall be rendered if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show 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).
B. Argument
1. Proximate Cause
Because it is an integral element in a number of Geier Brothers claims, the ability of Geier Brothers to show that Pro Blend proximately caused its losses must be addressed first. Both Furst-McNess and Griffin argue at length that Geier has failed to put forth expert testimony to show that Pro Blend can be distinguished from other feed components as the proximate cause of Geier Brothers' loss. They maintain that the expert retained by Geier Brothers, Dr. Guterbock, was only engaged to testify concerning whether failure to eat could cause the losses experienced by Geier Brothers, not whether that failure was caused by Pro Blend. In support of this argument, Furst-McNess quotes Dr. Guterbock's deposition:
A: Well, the question that was put to me was whether an unpalatable feed or the refusal of cows to eat, especially in early lactation, could cause the excessive losses ... the death and excessive culling that the Geiers saw. And that was the question that I was answering, yes, it could have.
....
A: [A]gain, the question that was put to me was would cows refusing to eat cause the kind of losses that the Geiers had?
....
Q: So, and correct me if I'm wrong, you were asked to provide an expert opinion as to whether[,] if the cows were refusing to eat ... they would experience the farmers, such as the Geiers, would experience the kind of losses that the Geiers were experiencing?
A: That's correct.
Q: Were you asked to determine why the cows were refusing to eat?
A: No.
(Guterbock Dep. at 16, 23, 25-26).
Had the previous exchange been the end of Dr. Guterbock's deposition as the Defendants suggest, then Geier Brothers might well have been unable to show proximate cause; however, the Defendants' argument is disingenuous, at best, when viewed in light of testimony given by Dr. Guterbock almost directly after the section quoted by Furst-McNess:
Q: As we sit here today, do you have an opinion as to why the cows refused to eat the ProBlend? Let's back up. Do you have not the ProBlend. Do you have an opinion as to why the cows refused to eat the feed?
A: Yes. My opinion is that it was probably due to the addition of the ProBlend.
Q: Why do you say that?
*804 A: Again, I say that because when a different product was used, the animals recovered. The animals on the farm that did not receive ProBlend did not show the adverse effects. And a cow that was given the opportunity to eat something different, ate it greedily even though she refused to eat the feed on the dairy.
(Guterbock Dep. at 26).
Dr. Guterbock's testimony, taken in a light most favorable to Geier Brothers, would allow a reasonable jury to find that the addition of Pro Blend to the feed mixture was the proximate cause of Geier Brothers' losses. Neither Defendant has shown how it is material to his testimony that this was not the specific question that he was asked. Griffin does suggest in passing that Dr. Guterbock's testimony should be excluded pursuant to Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993). Griffin's request, couched in a footnote in its memorandum in support of summary judgment and then mentioned again in its reply, is neither argued nor properly raised. Furthermore, the Defendants' contention that Dr. Guterbock's testimony was based on temporal evidence alone is not well-taken in light of the behavior of the cow given the opportunity to eat different feed. Dr. Guterbock's testimony will not be excluded at this juncture.
2. Claims Conceded by Geier
In its response to the motions for summary judgment, Geier Brothers concedes that it is unable to survive summary judgment on its claims against both Defendants for violation of the Lanham Act, mislabeling, failure to label, and violation of the Ohio Animal Feed Act. Geier Brothers also acknowledges that it is unable to maintain Count III against Griffin. Accordingly, summary judgment will be granted in favor of the Defendants on Counts I, X, XI, and XII of the amended complaint, and in favor of Griffin only on Count III of the amended complaint.
3. Breach of Implied Warranty
In Count II of its Amended Complaint, Geier Brothers claims that the Defendants breached an implied warranty that "the feed was fit for consumption by lactating dairy cattle and that use of the feed would improve the milk production of cattle fed the product."
In Ohio, claims of breach of implied warranty are governed by the state's Products Liability Act, O.R.C. § 2307.73. See Long v. Tokai Bank, 114 Ohio App.3d 116, 127, 682 N.E.2d 1052, 1060 (2d Dist. 1996). Section 2307.73 states, in pertinent part:
(A) A manufacturer is subject to liability for compensatory damages based on a product liability claim only if the claimant establishes, by a preponderance of the evidence, both of the following:
(1) Subject to division (B) of this section, the product in question was defective in manufacture or construction ... was defective in design or formulation ... was defective due to inadequate warning or instruction ... or was defective because it did not conform to a representation made by its manufacturer ...;
(2) A defective aspect of the product in question as described in division (A)(1) of this section was a proximate cause of harm for which the claimant seeks to recover compensatory damages.
O.R.C. § 2307.73 (West 2001).
Both Furst-McNess and Griffin argue that Geier Brothers has not put forth evidence to satisfy the proximate cause requirement in section 2307.73(A)(2). Griffin also argues that Geier Brothers has no *805 evidence that the Pro Blend was defective in manufacture or construction, design or formulation, or due to inadequate warnings or instructions. Absent is any assertion that Geier Brothers is unable to show that the Pro Blend was defective through failure to conform to a representation made by the manufacturer; further examination of Griffin's argument in that respect reveals that it is merely another attempt to highlight what Griffin perceives to be a lack of evidence of proximate cause. While Furst-McNess does mention the possibility of failure to conform with representations, it does so only to emphasize what it, too, believes to be lack of evidence showing proximate cause.
This Court has already determined, supra at II(B)(1), that Geier Brothers has satisfied its burden of showing that the Pro Blend was the proximate cause of its injuries. Furthermore, because neither Defendant properly addressed the issue of representations, there was no need for the Plaintiff to put forth evidence on that issue to survive summary judgment. Summary judgment for the Defendants on Count II of Geier Brothers' Amended Complaint will be denied.
4. Breach of Express Warranty
In Count III of its Amended Complaint, Geier Brothers claims that it is entitled to compensatory and incidental damages pursuant to Section 1302.89 of the Ohio Revised Code. Geier Brothers alleges that the Defendants breached an express warranty for a particular purpose. Geier alleges that the Defendants warranted that "the feed was fit for consumption by lactating dairy cattle and that use of the feed would improve the milk production of cattle fed the product, and the label identified what was in the bag." (Amd. Comp. at 10). Geier Brothers has abandoned its claim of breach of express warranty against Griffin.
Section 1302.26 of the Ohio Revised Code governs the creation of express warranties:
(A) Express warranties by the seller are created as follows:
(1) Any affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain creates an express warranty that the goods shall conform to the affirmation or promise.
(2) Any description of the goods which is made part of the basis of the bargain creates an express warranty that the goods shall conform to the description.
(3) Any sample or model which is made part of the basis of the bargain creates an express warranty that the whole of the goods shall conform to the sample or model.
(B) It is not necessary to the creation of an express warranty that the seller use formal words such as "warrant" or "guarantee" or that he have a specific intention to make a warranty, but an affirmation merely of the value of the goods or a statement purporting to be merely the seller's opinion or commendation of the goods does not create a warranty.
O.R.C. § 1302.26 (West 2001).
In its motion for summary judgment, Furst-McNess argues that Geier Brothers is unable to show that any express warranty was created because all of the statements allegedly relied upon by Geier Brothers were mere "puffing."[2] Geier Brothers contends that a warranty was *806 created when the salesman for Furst-McNess, Jim Bratton, stated that the use of the Pro Blend would increase milk production; Geier Brothers' desire for increased milk production was the reason for the purchase of the Pro Blend. (Marvin Geier Aff. at 2).
Furst-McNess does not address the increased production argument in its initial motion or in its reply. Instead, the reply reiterates the failed proximate cause argument. Because whether the alleged promise of increased production was mere puffing is a question for the jury, Furst-McNess's motion for summary judgment will be denied as to Court III of the Plaintiffs' Amended Complaint.
5. Negligent Preparation and Handling of Feed/Negligent Preparation and Recommendation of Feed Ration
In Count IV of its amended complaint, Geier Brothers avers that the Defendants negligently prepared and handled the Pro Blend. It claims that Griffin failed to properly identify the date of manufacture of the Pro Blend and the last date that the Pro Blend could be used. Geier Brothers also claims that Furst-McNess negligently allowed the product to remain in its warehouse and subsequently enter the stream of commerce in an unfit condition. In Count V of the amended complaint, Geier Brothers claims that its losses were caused by negligent preparation and recommendation of the feed ration.
As they argued with respect to previous counts of the amended complaint, Griffin and Furst-McNess contend that Geier Brothers is unable to prove that the allegedly negligent actions cause Geier Brothers' injury. Here, they are correct. Although Geier Brothers has put forth evidence sufficient to create a dispute of material fact as to whether their losses were caused by use of the Pro Blend in general, it has not identified any evidence tending to show that the losses resulted from the preparation or handling of the feed, or from the preparation and recommendation of the feed ration. Summary judgment will be granted in favor of both Defendants on Counts IV and V of the amended complaint.
6. Fraud and Intentional Misrepresentation
The amended complaint includes three counts of fraud or intentional misrepresentation. Geier Brothers claims in Counts VI and IIX of the amended complaint that the Defendants falsely misrepresented that the Pro Blend was fit for consumption by lactating cows despite Defendants' knowledge that the Pro Blend contained salmonella, metal shavings, and other dangerous and unpalatable items. These counts also allege that the Defendants knew that the Pro Blend in Lot 7223 had spoiled. In Count IX, Geier Brothers again alleges that the defendants failed to disclose that Lot 7223 had expired, then claims that Griffin intentionally included the unknown, unlabeled packages with the shipment of Lot 7223 despite knowledge that the unlabeled packages did not contain Pro Blend.
To make a claim for common law fraud or intentional misrepresentation, a plaintiff must show:
(a) a representation or, where there is a duty to disclose, concealment of a fact;
(b) which is material to the transaction at hand;
(c) made falsely, with knowledge of its falsity, or with such utter disregard and recklessness as to whether it is true or false that knowledge may be inferred;
(d) with the intent of misleading another into relying upon it;
(e) justifiable reliance upon the representation or concealment; and
(f) a resulting injury proximately caused by the reliance.
*807 Telephone Mgmt. Corp. v. Goodyear Tire & Rubber Co., 32 F.Supp.2d 960, 973 (N.D.Ohio 1998) (citing Russ v. TRW, Inc., 59 Ohio St.3d 42, 49, 570 N.E.2d 1076 (1991)).
Griffin contends that it can not be held liable on these claims because it did not make any representations to Geier Brothers prior to the use of the Pro Blend. Furst-McNess maintains that summary judgment is appropriate because Geier Brothers is unable to show that Furst-McNess had any knowledge that the Pro Blend was defective or that Furst-McNess intended to use that knowledge to mislead Geier Brothers.
The Defendants' argument is well-taken. Even assuming, arguendo, that both defendants made false material representations to Geier Brothers, Geier Brothers has offered no evidence to show that the representations were made with knowledge of their falsity or with any disregard of whether they were false. There is no evidence that Furst-McNess ever knew that the Pro Blend was defective, and there is no evidence that Griffin knew that the Pro Blend had spoiled and should have been removed from circulation. Summary judgment will be granted in favor of both Defendants on Counts VI, IIX, and IX of the amended complaint.
7. Negligent Misrepresentation
In Count VII of the amended complaint Geier Brothers avers that the defendants falsely and negligently represented that the Pro Blend was unspoiled and untainted by salmonella and metal shavings. The Ohio Supreme Court has adopted the Restatement (Second) of Torts to define negligent misrepresentation:
One who, in the course of his business, profession or employment, or in any other transaction in which he has a pecuniary interest, supplies false information for the guidance of others in their business transactions, is subject to liability for pecuniary loss caused to them by their justifiable reliance upon the information, if he fails to exercise reasonable care or competence in obtaining or communicating the information.
Delman v. City of Cleveland Heights, 41 Ohio St.3d 1, 4, 534 N.E.2d 835, 838 (1989) (quoting 3 RESTATEMENT (SECOND) OF TORTS § 552(1) (1965)) (emphasis omitted).
The Defendants argue that Geier Brothers can not show that they did not exercise the required care in obtaining any information provided to the Geier Brother. Although Geier Brothers acknowledges this requirement in its opposition to summary judgment, it does not put forth any proof that it could satisfy the requirement. Summary judgment in favor of the Defendants on Count VII of the amended complaint is appropriate.
CONCLUSION
For the foregoing reasons, Defendants' motion for reconsideration (Doc. No. 90) will be denied. Defendant Griffin Industries, Inc.'s motion for summary judgment (Doc. No. 46) will be denied as to Count II of the amended complaint and granted as to all other counts. Defendant Furst-McNess Company's motion for summary judgment (Doc. No. 44) will be denied as to Counts II and III of the amended complaint and granted as to all other counts.
IT IS SO ORDERED.
JUDGMENT ENTRY
For the reasons stated in the Memorandum Opinion filed contemporaneously with this entry, IT IS HEREBY ORDERED, ADJUDGED, and DECREED that Defendants' motion for reconsideration (Doc. No. 90) is denied.
FURTHER ORDERED that Defendant Griffin Industries, Inc.'s motion for summary judgment (Doc. No. 46) is denied as to Count II of the amended complaint and granted as to all other counts.
*808 FURTHER ORDERED that Defendant Furst-McNess Company's motion for summary judgment (Doc. No. 44) is denied as to Counts II and III of the amended complaint and granted as to all other counts.
NOTES
[1] The other plaintiffs in this action are the partners in Geier Brothers Farms: Marvin, Gerald, Nancy and Mary Geier. They will be referred to collectively as "Geier."
[2] These statements include, "make your animals productive and profitable no matter what stage of life they may be at," "best nutritionally balanced value for the dollar," and "what's on the tag is in the bag."
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892 F.2d 83
NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel.Louis Butler O'NEAL, Plaintiff-Appellant,v.C/O PETERSON of # 21 Gun Tower of Old Folsom State Prison,Defendant-Appellee.
No. 88-15704.
United States Court of Appeals, Ninth Circuit.
Submitted Oct. 23, 1989.*Decided Dec. 18, 1989.
Before ALARCON, O'SCANNLAIN, and LEAVY, Circuit Judges.
1
MEMORANDUM*
2
Louis Robert O'Neal, a California state prisoner, appeals pro se the district court's order dismissing without prejudice his 42 U.S.C. § 1983 action for lack of prosecution. The district court based the dismissal on Fed.R.Civ.P. 41(b) and United States District Court for the Eastern District of California Local Rule 271(a). Local Rule 271(a) permits a court to place on its dismissal calendar any action that has been pending for more than six months and in which the plaintiff has failed to take action for more than six months. We have jurisdiction under 28 U.S.C. § 1291 and we affirm.
3
We review a district court's order dismissing an action for failure to prosecute for an abuse of discretion. Carey v. King, 856 F.2d 1439, 1440 (9th Cir.1988) (per curiam).
4
In determining whether to dismiss an action for lack of prosecution, the district court must weigh several factors: " '(1) the public's interest in expeditious resolution of litigation; (2) the court's need to manage its docket; (3) the risk of prejudice to the defendants; (4) the public policy favoring disposition of cases on their merits; and (5) the availability of less drastic sanctions.' " Id. (quoting Henderson v. Duncan, 779 F.2d 1421, 1423 (9th Cir.1986).
5
We first consider any prejudice to O'Neal by this dismissal. Because § 1983 contains no statute of limitations, we borrow the forum state's statute of limitations for personal injury torts. Wilson v. Garcia, 471 U.S. 261, 276 (1986). When a state has one or more statutes of limitations for certain enumerated torts, as is the case with California, the statute of limitations for § 1983 actions is "the residual or general personal injury statute of limitations." Owens v. Okure, --- US. ----, ----, 109 S.Ct. 573, 574 (1989). Under Cal.Civ.Proc.Code § 340(3), the statute of limitations for § 1983 actions is one year from the date of accrual. Del Percio v. Thornsley, 877 F.2d 785, 786 (9th Cir.1989). O'Neal's complaint alleges that his injury occurred on January 27, 1988. The district court entered its dismissal without prejudice on November 30, 1988. As a result, O'Neal had over seven weeks in which to file a new complaint before the statute of limitations ran. Because O'Neal had adequate time in which to renew his action, we find no prejudice to him in the dismissal.
6
A dismissal without prejudice when the statute of limitations has not run is not a drastic sanction. See Carey v. King, 856 F.2d at 1441 (in a prisoner's § 1983 action, alternative measure such as order to show cause when dismissal was not warranted or an order imposing sanctions "would only find itself taking a round trip tour through the United States mail"). The only effect of the district court's action was to allow it to clear its docket and enable O'Neal to refile his action if he so desired.
7
O'Neal failed to take any action in his case for over eight months. He made no response to the order to show cause why his action should not be dismissed for lack of prosecution, and he failed to explain his nonresponsiveness in his objections to the magistrate's findings and recommendations. Further, he offered no suggestions to the district court as to what he would have done to pursue his action. Finally, O'Neal has not provided us with any explanation for his failure to pursue his action or respond to the order to show cause in his appellate brief.
8
For these reasons, the district court did not abuse its discretion in dismissing without prejudice O'Neal's complaint.
9
The judgment is hereby AFFIRMED.
*
The panel unanimously finds this case suitable for submission on the record and briefs and without oral argument pursuant to Fed.R.App.P. 34(a), Ninth Circuit Rule 34-4
**
This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3
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541 U.S. 1048
HOLDENv.INDIANA.
No. 03-9372.
Supreme Court of United States.
May 17, 2004.
1
Sup. Ct. Ind. Certiorari denied. Reported below: 788 N. E. 2d 1253.
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IN THE COURT OF APPEALS OF IOWA
No. 16-0713
Filed April 5, 2017
STATE OF IOWA,
Plaintiff-Appellee,
vs.
MELVIN LUCIER,
Defendant-Appellant.
________________________________________________________________
Appeal from the Iowa District Court for Scott County, Joel W. Barrows,
Judge.
Melvin Lucier appeals his judgment and sentence for sexual abuse in the
third degree. AFFIRMED.
Mark C. Smith, State Appellate Defender, and Stephan J. Japuntich,
Assistant Appellate Defender, for appellant.
Stuart G. Hoover of Blair & Fitzsimmons, P.C., Dubuque, for appellee.
Considered by Mullins, P.J., Bower, J., and Mahan, S.J.*
*Senior judge assigned by order pursuant to Iowa Code section 602.9206 (2017).
2
MAHAN, Senior Judge.
The State charged Melvin Lucier with three counts of sexual abuse in the
second degree (Counts I, II, and III) and one count of sexual abuse in the third
degree (Count IV). Lucier filed a motion to sever Counts I, II, and III from Count
IV. He also filed a written waiver of jury trial. At a hearing on the motions, the
following colloquy took place:
COURT: Then let’s deal with the waiver of jury trial. Mr.
Motto, you indicated to me that Mr. Lucier at this point wishes to
waive jury trial for trial set for November 4th, is that correct?
MR. MOTTO: That’s correct, Your Honor. On November
2nd, I believe, but Counts I, II, and III only.
COURT: All right. Is that correct, Mr. Lucier?
DEFENDANT: Yes, Your Honor.
The district court granted Lucier’s motions; Counts I, II, and III were severed and
tried to the bench, and Count IV was tried to a jury. Lucier was convicted on all
counts.
On appeal, Lucier contends his due process rights were violated because
Count IV was severed and “tr[ied] to a jury after [he] waived his right to a jury
trial.” Because Lucier requested the court waive jury trial for “Counts I, II, and III
only,” his claim is unpersuasive. The court merely proceeded as Lucier
requested. In any event, Lucier did not preserve error on this issue; at no time
did Lucier alert the court he did not wish for Count IV to be tried to a jury. “It is a
fundamental doctrine of appellate review that issues must ordinarily be both
raised and decided by the district court before we will decide them on appeal.”
Lamasters v. State, 821 N.W.2d 856, 862 (Iowa 2012) (quoting Meier v.
Senecaut, 641 N.W.2d 532, 537 (Iowa 2002)).
3
Lucier further claims his due process rights were violated “when a juror
was excused and replaced by an alternate juror who was informed from the
outset of the proceedings that he was an alternate juror.” Again, because this
issue was not raised below, we will not consider it on appeal. See id. We affirm
Lucier’s judgment and sentence for sexual abuse in the third degree.
AFFIRMED.
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424 F.2d 1021
70-1 USTC P 9336
UNITED STATES of America, Plaintiff-Appellant,v.Horton R. PRUDDEN, Defendant-Appellee.
No. 28140.
United States Court of Appeals, Fifth Circuit.
April 10, 1970, Rehearing Denied and Rehearing En BancDenied June 26, 1970.
Samuel S. Forman, Asst. U.S. Atty., Jacksonville, Fla., Jonnie M. Walters, Asst. Atty. Gen., Joseph M. Howard, John M. Brant, Attys., Tax Div., U.S. Dept. of Justice, Washington, D.C., Edward F. Boardman, U.S. Atty., John L. Briggs, U.S. Atty., Middle District of Florida, for plaintiff-appellant.
C. Harris Dittmar, Chester Bedell, Charles P. Pillans, Jacksonville, Fla., for defendant-appellee; Bedell, Bedell, Dittmar, Smith & Zehmer, Jacksonville, Fla., of counsel.
Before JOHN R. BROWN, Chief Judge, and COLEMAN and CLARK, Circuit judges.
CLARK, Circuit Judge:
1
Horton R. Prudden was indicted on seventeen counts of evading taxes due the United States. On taxpayer's motion made prior to trial, the court below in a blanket order suppressed all statements made and all corporate and personal documents furnished by Prudden to a special agent of the Internal Revenue Service, together with all evidence obtained through or as a result of such statements or documentary evidence. Suppression was based on a finding that the Internal Revenue Service had obtained such statements and documents by engaging in a deliberate scheme to deceive Prudden in order to prevent his understanding that an investigation originally commenced by a revenue agent had materially altered at the time the special agent entered the case.1 The United States chose to appeal the suppression order rather than to proceed to trial without the evidence thus suppressed. Since the record does not clearly and convincingly demonstrate a deliberate scheme to deceive and we reject the taxpayer's contention that he was entitled to Miranda warnings, we reverse.
2
The following facts are either undisputed or are stated most favorably to the taxpayer. On May 10, 1963, certain returns of The Florida Corporation of America (FCA) and its subsidiaries were assigned to Revenue Agent Lexow for the purpose of determining the correctness of the tax reported. At this time Lexow had been with the Internal Revenue Service about one year-- he was still in training and was not a full-grade agent. Prudden was 50 years of age, a law school graduate and then employed as a security analyst for a member firm of the New York Stock Exchange. After learning that FCA was to be examined, Prudden telephoned Lexow at the Palm Beach office of the Internal Revenue Service from his home in Connecticut, stating that he was a director of FCA. He inquired if Lexow's examination was to cover FCA alone or its subsidiaries also and further asked if the examination was routine. Lexow replied that the examination would cover both FCA and its subsidiaries and that it was not routine; that the returns had been selected in Jacksonville to be examined and had been assigned to Lexow from there.
3
The examination actually commenced on May 31 when Lexow contacted Mrs. Anne G. Smith, who was indicated on the returns to be the president of these corporations.2 All of Lexow's subsequent examinations were made under the supervision of Mrs. Smith either with or without Prudden present. Prudden and Mrs. Smith were cooperative with Agent Lexow, furnishing him most of the documents he wished to examine and making copies for him at his request. By June 17 Lexow's examinations had disclosed what he considered to be possible indications of fraud. It appeared to Lexow that a Nassau based corporation, Research and Development, Ltd., might be skimming profits off one of FCA's subsidiaries. He further noted there was no indication as required on the return, that the Bahamian and American corporations were related. Lexow had also discovered information concerning a sale of stock which gave the appearance of having produced a large capital gain, but had been reported as a loss. By this time Lexow's investigation had also broadened to cover Prudden's personal returns. Lexow made no report of these suspicions to his superiors at this juncture because he wanted to pursue the examination further.
4
A number of times during Lexow's audit Prudden told him that if they found anything wrong, he, Prudden, wished that Lexow would let him know so that it could be corrected and any tax due could be paid. Prudden was particularly insistent that Lexow advise him on how to handle several details of a particular stock sale. Lexow testified that it was possible that he did tell Prudden that when all the facts were known to him he would advise Prudden how a 52,000 dollar escrow item connected with the stock sale should be handled, but Prudden admits he never got this advice.
5
When a revenue agent discovers indicia of fraud in the course of an examination, the routine procedure requires that he refer a complete report of his findings to the Intelligence Division of the revenue service, which then determines whether it will assign a special agent to take charge of the case. On June 27, while Lexow's examination was continuing, he had his first discussions with other persons in his office about the possibility of referring the case to the Intelligence Division. Lexow began to write his referral report on July 3 and completed it on July 15. On July 9 he wrote Prudden requesting bank statements and canceled checks of Research and Development, Ltd., urging him to forward these documents to Lexow in order to save time and enable Lexow to proceed with his examination of FCA and its subsidiaries. He also complimented Prudden on his cooperation. A copy of this letter is set out in the margin.3 It was not shown that Prudden ever furnished the documents requested to Lexow or his successors.
6
Lexow did not meet with Prudden or Mrs. Smith after July 9. On August 14, Lexow received advice from the Intelligence Division that it had decided to make a full-scale investigation. On August 29, after a telephone conversation with Mrs. Smith indicated that Prudden wanted a written request, Lexow wrote Prudden requesting that copies be made available to him of papers previously furnished but inadvertently left in the corporation's office. He also asked for a schedule which computed losses incurred from acts of an unfaithful employee. In this letter Lexow advised Prudden that he was being transferred at his own request, to an assignment that would permit him to return to college, and that Agent Lewis E. Stanley was to become the agent on the case. Lexow's letter requested Prudden to continue to cooperate with Agent Stanley. A copy of this letter is set out in the margin.4 On the date of this letter Lexow knew that Special Agent Edward M. Cohen was then in charge of the Prudden investigation, but his name was not mentioned to Prudden or Mrs. Smith.5
7
In several instances, Prudden refused to give Lexow requested documents which Prudden felt were outside the proper scope of Lexow's examination. Lexow once told Prudden that the Internal Revenue Service would never leave him alone until he produced some records for Research and Development, Ltd. Prudden took the position that such records did not have to be produced and, as stated, he never produced them. On one occasion when Lexow raised a question as to constructive ownership with Prudden, Prudden told Lexow not to attempt to tell him about the rules of constructive ownership, that subject had been his specialty in law school and he had studied it for three years. On several occasions Prudden told Lexow that he, Lexow, was simply on a fishing expedition-- trying only to gather facts that would support Lexow's preconceived conclusions. In his final letter to Lexow, Prudden stated that he was left with the impression that items were being singled out of context in order to attack his intentions as unfair and not forthright. He pointed out that he had frequently asked for the Internal Revenue Service's views but had never received a stable answer of any kind. He further offered to review with Agent Stanley 'whatever context he may wish to go over,' expressly including the summary of losses sustained due to activities of the unfaithful employee, which Lexow had previously requested.
8
On September 13, 1963, Revenue Agent Lewis E. Stanley wrote Prudden confirming a meeting on October 1, 1963 in Palm Beach. Although the letter did not mention him, Special Agent Cohen intended to and did meet with Prudden and Stanley. When Cohen and Stanley opened the meeting they identified themselves to Prudden as a special agent and a revenue agent respectively, and showed him their written credentials, which he examined. Cohen's credentials plainly carried the legend 'Intelligence Division'. Prudden testified that he did not know the significance of Cohen's designation as a special agent. They informed Prudden that they were there to make an audit and examination of his returns, the returns of his three sons and the returns of FCA and its eight subsidiaries. He was also told that the examination would include any other corporation or gift tax returns that he had filed. Neither Stanley nor Cohen ever stated to Prudden that a criminal investigation was being conducted or that the investigation they were making was being made to determine the possibility of fraud. Prudden was never given any warning nor was he ever advised that he had a right to remain silent or that any information furnished by him could be used against him in any subsequent proceedings. All actions and procedures followed by Stanley and Cohen were in accord with what was then the Internal Revenue Service's standard procedure in such cases.
9
On December 21, 1964, Revenue Agent Stanley and Special Agent Cohen interviewed Prudden at the Internal Revenue Service Intelligence Division office. Prudden answered the questions asked him but refused to allow the conversation to be recorded. All other meetings between Prudden and the IRS agents were at Prudden's office at his convenience during regular business hours. The work of Special Agent Cohen and Agent Stanley extended over a period of some fifteen months. Prudden persisted in refusing records of the Bahamian corporation and records outside the years he felt were properly open. He continued to complain that the agents were fishing and criticized third-party investigations, but he also continued to cooperate within these limits with the agents' requests for information and records during the entire period.
I. NECESSARY WARNINGS AND ADVICE
10
Prudden contends that the evidence obtained after Special Agent Cohen entered the investigation must be suppressed because he, Prudden, was not warned and advised of his rights according to Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966).6 We adhere to our prior rulings and reject this contention. However, the Supreme Court's ruling in Mathis v. United States, 391 U.S. 1, 88 S.Ct. 1503, 20 L.Ed.2d 381 (1968) reversing this court and holding that routine tax investigations are not immune from the Miranda requirements for warnings to be given to a person in custody, and two recent decisions from the Seventh Circuit which reach a result contrary to ours here,7 indicate that we make a detailed review of this issue.
11
A recurrence to the constitutional foundation is always an appropriate beginning point. The Fifth Amendment's mandate is that no person shall be 'compelled in any criminal case to be a witness against himself, * * *.'
12
Compulsion, a requisite to the invocation of the Amendment's protection against self-incrimination, was not attentuated in Miranda. The majority opinion in Miranda is complex and lengthy but the following pertinent extracts highlight the problem presented and explain the controlling principles. In the preface the court epitomized the decision's meaning thusly:
13
'Our holding will be spelled out with some specificity in the pages which follow but briefly stated it is this: the prosecution may not use statements, whether exculpatory or inculpatory, stemming from custodial interrogation of the defendant unless it demonstrates the use of procedural safeguards effective to secure the privilege against self-incrimination. By custodial interrogation, we mean 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.'
14
(384 U.S. at 444, 86 S.Ct. at 1612)
Part I began with the following paragraph:
15
'The constitutional issue we decide in each of these cases is the admissibility of statements obtained from a defendant questioned while in custody or otherwise deprived of his freedom of action in any significant way. In each, the defendant was questioned by police officers, detectives, or a prosecuting attorney in a room in which he was cut off from the outside world. In none of these cases was the defendant given a full and effective warning of his rights at the outset of the interrogation process. In all the cases, the questioning elicited oral admissions, and in three of them, signed statements as well which were admitted at their trials. They all thus share salient features-- incommunicado interrogation of individuals in a police-dominated atmosphere, resulting in self-incriminating statements without full warnings of constitutional rights.'
16
(384 U.S. at 445, 86 S.Ct. at 1612)
17
The Court continued by pointing out that sophisticated psychological techniques had been developed by police to supplant the oft condemned use of physical force to extort confessions, the key to which called for isolating suspects from familiar surroundings and friends. It distilled the new techniques this way:
18
'From these representative samples of interrogation techniques, the setting prescribed by the manuals and observed in practice becomes clear. In essence, it is this: To be alone with the subject is essential to prevent distraction and to deprive him of any outside support. The aura of confidence in his guilt undermines his will to resist.'
19
(384 U.S. at 455, 86 S.Ct. at 1617) and concluded thusly:
20
'In each of the cases, the defendant was thrust into an unfamiliar atmosphere and run through menacing police interrogation procedures. The potentiality for compulsion is forcefully apparent, * * *. It is obvious that such an interrogation environment is created for no purpose other than to subjugate the individual to the will of his examiner. This atmosphere carries its own badge of intimidation.'
21
(384 U.S. at 457, 86 S.Ct. at 1618)
22
Part II traced the history of the privilege, its embodiment in our Constitution and its subsequent court implementations down through Escobedo v. Illinois, 378 U.S. 478, 84 S.Ct. 1758, 12 L.Ed.2d 977 (1964), with this application of the latter's rationale:
23
'The entire thrust of police interrogation there, as in all the cases today, was to put the defendant in such an emotional state as to impair his capacity for rational judgment. The abdication of the constitutional privilege-- the choice on his part to speak to the police-- was not made knowingly or competently because of the failure to apprise him of his rights; the compelling atmosphere of the in-custody interrogation, and not an independent decision on his part, caused the defendant to speak.'
24
(384 U.S. at 465, 86 S.Ct. at 1623)
25
Part III demonstrated how the rule announced was to be employed and detailed the justification for tendering an attorney's advice. It closed with this caveat:
26
'Our decision is not intended to hamper the traditional function of police officers in investigating crime. See Escobedo v. State of Illinois, 378 U.S. 478, 492, 84 S.Ct. 1758, 1765. When an individual is in custody on probable cause, the police may, of course, seek out evidence in the field to be used at trial against him. Such investigation may include nquiry of persons not under restraint. General on-the-scene questioning as to facts surrounding a crime or other general questioning of citizens in the fact-finding process is not affected by our holding. It is an act of responsible citizenship for individuals to give whatever information they may have to aid in law enforcement. In such situations the compelling atmosphere inherent in the process of in-custody interrogation is not necessarily present.46 46. 'The distinction and its significance has been aptly described in the opinion of a Scottish court:
27
'In former times such questioning, if undertaken, would be conducted by police officers visiting the house or place of business of the suspect and there questioning him, probably in the presence of a relation or friend. However convenient the modern practice may be, it must normally create a situation very unfavourable to the suspect.' Chalmers v. H. M. Advocate (1954) Sess.Cas. 66, 78 (j.C.).'
28
'In dealing with statements obtained through interrogation, we do not purport to find all confessions inadmissible. Confessions remain a proper element in law enforcement. Any statement given freely and voluntarily without any compelling influencess is, of course, admissible in evidence. The fundamental import of the privilege while an individual is in custody is not whether he is allowed to talk to the police without the benefit of warnings and counsel, but whether he can be interrogated. There is no requirement that police stop a person who enters a police station and states that he wishes to confess to a crime, or a person who calls the police to offer a confession or any other statement he desires to make. Volunteered statements of any kind are not barred by the Fifth Amendment and their admissibility is not affected by our holding today.' (384 U.S. at 477, 478, 86 S.Ct. at 1629-1630). Cf. United States v. Robertson, 425 F.2d 1386 (5th Cir. 1970).
29
In Mathis v. United States, supra, the taxpayer was convicted of tax fraud on the basis of evidence elicited by a regular revenue agent on a routine investigation made while the taxpayer was in prison for an unrelated crime. The Supreme Court reversed our affirmance of the conviction8 because the prisoner had not been given the Miranda warnings. Although Mathis makes it clear that Miranda is potentially applicable to any tax investigation, it most definitely does not require Miranda warnings in all tax investigations. Mathis in no way diminishes the necessity for showing actual or inherent compulsion to self-incrimination. Mathis was not merely at the station house, he was imprisoned for a fixed term. He was deprived of his liberty in a most positive way. Thus when the court established that the type of inquiry there present was not determinative, the result was necessarily a finding of Fifth Amendment violation.
30
In our view, the Seventh Circuit's recent opinion in United States v. Dickerson, supra, which petitioner urges we now adopt, is an unwarranted extension of the Miranda decision. Dickerson held that Miranda warnings must be given a taxpayer at the inception of first contact with him following the transfer of a tax case to the Intelligence Division. The facts recited in that opinion show no element of custody or restraint-- no deprivation of freedom-- no compelling atmosphere-- only a visit by a regular and a special agent of the Internal Revenue Service to defendant at his place of business. The opinion stated:
31
'We understand the teaching of Miranda to be that one confronted with governmental authority in an adversary situation should be accorded the opportunity to make an intelligent decision as to the assertion or relinquishment of those constitutional rights designed to protect him under precisely such circumstances.' 413 F.2d at 1114.
32
Thus, the court inferred compulsion from the fact that the investigators represented 'governmental authority in an adversary situation.' Such a rule is over broad and we expressly decline to follow it.
33
We cannot agree that every administrative official who confronts a citizen with a request for information that might disclose criminal conduct, thereby exerts a compulsion on the citizen that must be dispelled by the Miranda placebo. In today's vast and complex network of widespread daily administrative contacts between citizens and government officials, such a holding would open a veritable Pandora's box. When a census taker returns to recheck information he has received or a building inspector comes to investigate a report of noncompliance with provisions of the city housing code or a game warden who hears shooting out-of-season stops a man he finds in the woods or a bank examiner questions a teller whose figures are out of balance, would each then have to give the Miranda warnings? In each case a governmental official is confronting a citizen and criminal charges may result. There are a thousand and one administrative inquiries routinely made every day in every city which could evoke responses that might form a part of the basis in proof for a charge of perjury, falsification of records, failure to file a report or perform a legal duty or other criminal conduct. Most of these routine administrative confrontations would be rendered ineffective to the citizen and his government by imposing Miranda requirements. Indeed, if the warning became too commonplace, the very purpose of its requirement could be undermined. If 'authority' were allowed to supplant custody-- the deprivation of freedom-- as the determinant of compulsion, even these routine field investigations which Miranda expressly exempted must fall. Under such a rule a policeman upon stopping a motorist could not ask to see his license without warning him and advising him in full.9 It is not for this Court to so extend Miranda, and we are particularly unwilling to extend it to an adult experienced businessman, a law school graduate, who for over a year voluntarily furnished selected corporate and personal records to tax agents-- not claimed to be overbearing but over kind.10
34
The record shows that Prudden's interviews with all the agents were on generally amicable terms-- what Prudden described as 'a normal business arrangement.' He limited the information he gave the agents, specifically refusing to give them requested information from years not under examination and the records of the Bahamian subsidiary. He testified that he was never threatened. He even testified that Lexow once told him that the Internal Revenue Service would not leave him alone unless he produced the Bahamian company records, yet he never produced them. There was simply no factual support for a contention that Prudden was put in such an emotional state as to impair his capacity for rational judgment.
35
Moreover, there is no evidence that the incriminating evidence was coerced as a matter of law; i.e., was the result of incustody interrogation or anything approaching comparable pressures.11 None of the evidence that Prudden seeks to suppress was obtained while he was under arrest or under any sort of actual or implied restraint. In fact, Prudden's fraud, deceit and trickery contentions strongly militate against any thought of pressure. The basic thrust of this other contention is that the agents were too nice to him. He was never deprived of his freedom in any significant way during the questioned interviews, all but one of which took place at his own office at his convenience during regular office hours.12 The one interview which occurred in the Internal Revenue Service office is of no consequence. He came to the office voluntarily and was not restrained from leaving whenever he chose. The courts have uniformly held that such office interviews are neither custodial nor do they impose any significant restraints of freedom.13
36
In applying Miranda's rule, this Circuit has taken a case-by-case approach on the theory that 'to foster proper development of controlling precedent * * * each case must be examined to determine whether there were present the compulsive factors with which Miranda was concerned.' United States v. Montos, 421 F.2d 215, 223 (5th Cir. 1970). All of our case-by-case holdings have uniformly applied one concept-- that Miranda warnings are not constitutionally required in tax investigation cases where the taxpayer is not deprived of his freedom and is not actually compelled or coerced to furnish statements or documents. Such holdings and our ruling here are also consistent with other circuits.14 Our most recent decisions have maintained a similar consistency of approach. In Agoranos v. United States,409 F.2d 833 (5th Cir.), cert. den., 396 U.S. 824, 90 S.Ct. 67, 24 L.Ed.2d 75 (1969) the taxpayer sought reversal of a tax fraud conviction because he had not been given Miranda warnings. We refused to reverse because at the time the taxpayer was questioned by the special agent he 'was not in custody and the Miranda doctrine applies only to in-custody interrogation.'15 Prudden seeks to distinguish Agoranos because the special agent did not know at the time of the questioning that the taxpayer was being investigated, but such an attempted distinction misses the true thrust of that holding-- the taxpayer was not in custody or under compulsion when the interview took place. In United States v. Jernigan, 411 F.2d 471 (5th Cir.), cert. den., 396 U.S. 927, 90 S.Ct. 262, 24 L.Ed.2d 225 (1969) we again refused to require Miranda warnings. Prudden's attempt to distinguish this case because the agent was a regular and not a special agent not only conflicts with Mathis but is not apropos to the point he makes. Regular agents frequently obtain evidence which later forms one or more links in the chain which affixes criminality to the acts of a tax evader.
37
Marcus v. United States, 422 F.2d 752 (5th Cir. 1970) is our latest decision which discusses this question. Marcus was convicted for failing to file individual tax returns. One ground of his appeal was that he had not been given Miranda warnings nor expressly told of the criminal nature of the investigation by special agents of the Internal Revenue Service until after he had supplied records and made damaging admissions.16 Marcus contended, as Prudden now does, that Miranda applied to noncustodial tax fraud investigations. We rejected this contention with the statement: 'In a criminal tax fraud case, this Court has recently held that the Miranda doctrine applies only to in-custody interrogation. Agoranos v. United States, 5 Cir., 1969, 409 F.2d 833. Since (the taxpayer) was at no time in custody during the Internal Revenue Service investigation, the contention is without merit.'17
38
Two recent cases before this court, United States v. Roundtree, 420 F.2d 845 (5th Cir. 1969) and Stuart v. United States, 416 F.2d 459 (5th Cir. 1969), concerned a related but distinguishable question. Those taxpayers claimed that enforcement of an Internal Revenue Service administrative summons would compel them to incriminate themselves. In those cases we recognized that a routine tax investigation may be criminal in nature. In Roundtree we stated that if the taxpayer can show that the proceeding had become an inquiry with dominant criminal overtones, he would be entitled to raise Fifth Amendment objections. Compulsion was present in Roundtree and Stuart in the form of the subpoena and the single remaining element necessary to invoke the Fifth Amendment's protection was the claim of self-incrimination. Even if Prudden could show that the inquiry into the tax liability of the corporation, himself and his family was one with dominant criminal overtones, he would fail to bring himself within Miranda's ambit because he cannot show compulsion.
II. THE CLAIM OF FRAUD, DECEIT AND TRICKERY
39
The trial judge suppressed all evidence obtained on or after the day when Lexow referred the case to the Intelligence Division because he found that the Internal Revenue Service agents engaged in a deliberate scheme to deceive Prudden in order to prevent his suspecting that the nature of the investigation had altered materially.18 Here the ultitimate fact determination was reached by a process of reasoning from undisputed evidentiary facts. After a careful review of the entire record, we conclude that ultimate fact finding-- fraud, deceit and trickery by the agents-- is a mistaken one.19 We are left with the definite and firm conviction that this finding is in error.20
40
Because of the holding we make here it is unnecessary to discuss the breadth of the suppression order, reaching as it did not just personal records but corporate records in corporations with which Prudden was connected only as a director or an employee. No claim of privilege as to self-incrimination relative to this type of third party records has previously been recognized. See, e.g., Hale v. Henkel, 201 U.S. 43, 26 S.Ct. 370, 50 L.Ed. 652 (1906); Fineberg v. United States, 393 F.2d 417 (9th Cir. 1968); Hensley v. United States, 406 F.2d 481 (10th Cir. 1968).
41
If the evidence obtained subsequent to Special Agent Cohen's entry into the investigation were the result of an unreasonable search in violation of the Fourth Amendment, then it would have to be suppressed. Prudden also asserts violation of Fifth and Sixth Amendment rights. Since all claimed violations depend upon a showing of the existence of fraud, deceit or trickery, it is not necessary to discuss each constitutional claim separately. Prudden postulates that the search was unreasonable because his consent to examine the records was obtained by fraud, deceit and trickery. While we recognize that fraud, deceit or trickery in obtaining access to incriminating evidence can make an otherwise lawful search unreasonable,21 Prudden, as the moving party in the motion to suppress, did not sustain the burden that was his of demonstrating that fraud, deceit or trickery were present.22
42
The essence of Prudden's contention and the finding of the trial court is that the circumstances surrounding the transformation of the investigation into one with increased possibilities of resultant criminal charges without Prudden's knowledge, required suppression of the evidence.23 Just how Prudden was defrauded, deceived or tricked is what we fail to perceive. Certainly, if the agents had given Prudden the full panoply of Miranda warnings, and advice, he could not make such a claim. Miranda warnings, however, were not required. So what were the agents required to do or leave undone or say or let go unsaid that discloses the fraud, deceit and trickery? They told him they wanted to audit and examine records in his possession relating to tax returns. They pursued this announced intention in what Prudden describes as a businesslike way at intervals over many months, despite his occasional expressions of discontent. We are unable to say that they had a duty to do more or less under the circumstances disclosed by this record.
43
Prudden points to the failure of Special Agent Cohen to tell him that his function was to investigate for criminal fraud. All Cohen was required to do by the then existing Internal Revenue Service requirements was to tell Prudden that he was a Special Agent and show Prudden his credentials. This he did. He in no way concealed his true identity. He could not have affirmatively mislead Prudden as to the function of the Intelligence Division or as to the duties of a special agent, since neither of these subjects were ever discussed. Silence can only be equated with fraud where there is a legal or moral duty to speak or where an inquiry left unanswered would be intentionally misleading.24 None of these factors were present here.
44
In Spahr v. United States, supra note 21, one ground of taxpayer's appeal of his conviction for corporate tax evasion was that incriminating evidence was procured through guile and fraud. Allegedly the revenue agents fraudulently concealed the true purpose of their investigation. As in the instant case, two agents merely identified themselves as a special agent and a revenue agent, respectively, without giving any additional warnings. The Ninth Circuit found no deception. Quoting the Second Circuit's opinion in United States v. Sclafani, supra note 21, they said:25
45
'A 'routine' tax investigation openly commenced as such is devoid of stealth or deceit because the ordinary taxpayer surely knows that there is inherent in it a warning that the government's agents will pursue evidence of misreporting without regard to the shadowy line between avoidance and evasion, mistake and willful omission.'
46
In Sclafani, as in the instant case, the taxpayer objected that records obtained from him after the 'routine audit' commenced by a revenue agent was turned over to a special agent should have been suppressed because they were obtained through stealth and deceit. The court found no fraud or deceit and stated:26
47
'The Fourth Amendment does not require more than this, that when his consent is sought the taxpayer be apprised of the government's concern with the accuracy of his reports, and therefore of such hazards as may be incident to a voluntary disclosure. We hold that Sclafani was so apprised by the warning inherent in the request when Agent Sonkin identified himself and disclosed his purpose to audit certain returns of the corporation.'
48
We conclude that the mere failure of a revenue agent (be he regular or special) to warn the taxpayer that the investigation may result in criminal charges, absent any acts by the agent which materially misrepresent the nature of the inquiry, do not constitute fraud, deceit and trickery. Therefore, the record here must disclose some affirmative misrepresentation to establish the existence of fraud, and this showing must be clear and convincing.27
49
Prudden points to several incidents to establish the existence of affirmative misrepresentations by the Internal Revenue Service agents. He does not in any of these, however, establish fraud by clear and convincing proof, rather the evidence tends to show that fraud was not present.
50
Audit and Examination. Prudden seeks to distinguish Spahr and Sclafani because in those cases no affirmative acts of misrepresentation were shown. On the other hand, Prudden claims that Cohen's statement at the hearing that 'we informed Mr. Prudden that we had come for an audit and examination of his returns-- his son's returns, and the returns of the Florida Corporation of America and its eight subsidiaries' was affirmative misrepresentation in the case at bar. Telling Prudden that an audit and examination were to take place is not deceptive. That is exactly what the agents did. They audited and examined his books. That in so doing they uncovered incriminating evidence does not change the character of the investigation they undertook. Audit and examination is but one means of gathering evidence in a tax fraud case. Since the agents did not have to warn him directly that they were undertaking a criminal investigation, then telling him the means by which they were to gather evidence in no way is misleading.
51
Letters from Lexow to Prudden. Prudden contends that the two letters from Lexow fraudulently misrepresented the nature of the inquiry. The July 9th letter, which was written before the Intelligence Division came into the case but while Lexow was preparing to refer it to them, asked Prudden to send records of one of FCA's subsidiaries to him in order to facilitate his examination and to save Prudden time.28 There are no misrepresentations of fact in the letter. Even if the letter had been misleading, Prudden complains of no evidence obtained as a result of it. In fact, the record does not show that he ever complied with the letter's request. Furthermore, the trial court's suppression order only applied to evidence obtained on or after August 14, a full month after the writing of the letter.
52
The second letter was written on August 28,29 two weeks after the referral of the case to the Intelligence Division without advising him of any change in the nature of the investigation. There is no evidence of guile by Lexow. He testified that he was only conscientiously trying to leave a complete record of all the facts he had previously accumulated for his successor. The documents he requested were those which Prudden had already authorized him to copy, but he had inadvertently left them in Prudden's office. Thus, nothing new was added to the government's case. Furthermore, the evidence received pursuant to this letter was exempted from the suppression order by the trial court, to which Prudden did not object. Secondly, Prudden contends that the letter was deceptive since Lexow's reference to the transfer of the case to Revenue Agent Stanley was calculated to raise no suspicion and specific mention that Special Agent Cohen of the Intelligence Division would henceforth be in charge of the investigation was omitted. Lexow testified that his omission of the Special Agent's assignment to the case was not made because he was afraid of the flow of information would be cut off. The only possible harm in this letter would be that Prudden would think that the entry into the case of a different agent was of no significance. Whatever momentary misapprehension in this direction that was left in Prudden's mind by the letter should have been quickly dispelled by the actual appearance not only of Revenue Agent Stanley but also Special Agent Cohen. In place of one neophyte, two experienced agents appeared and persisted in an examination and audit for fifteen months. At any rate, this contention falls far short of persuading us that the letter was fraudulent.
53
Friendliness of the Agents. Prudden argues that the nature of the investigation was concealed because of the friendliness and cordiality of the relationship between himself and the agents. Most of the evidence he cites as proof of deceit through cordiality is with regard to Lexow. Here again we are reminded that none of the information gathered by Lexow is subject to suppression. Even with regard to the more business-like attitudes adopted by Cohen and Stanley, we perceive no possible subterfuge. We can see no reason why civil servants should be required in their daily dealings to assume an uncivil character just because they are in a position to discover criminality on the part of a citizen. That would be a poor form of warning at best. If direct warnings are unnecessary, then requiring circuitous warnings by the manner of action of the agents is irrational. Furthermore, the tone of every interpersonal relationship is subject to the control of all the parties. Prudden's own conduct was a necessary ingredient of the amicable relationship of which he now complains. It may well be that kindness on a taxpayer's part could be calculated to dispel an agent's suspicions or to help to persuade him to see the results of his investigation in the most favorable light. By this we only mean to observe that 'it takes two to tango'.
54
Promises and Advice. Prudden further argues that promised advice from the agents, another manifestation of their 'deceptive' cordiality, was fraudulent. He first claims that Lexow said that he would advise him on how to handle one feature of a particular stock sale involving a 52,800 dollar escrow account. Lexow promised Prudden an answer when he knew all the facts. But Lexow left the investigation without giving Prudden any answer. So Lexow's promise was not deceitful. Prudden also pressed Cohen and Stanley for advice in regard to the same transaction but admits that he got no 'recognizable answer.' The long and short of this is that none of the agents ever gave him any advice on the escrow transaction. How could this deceive him? Prudden also claims that the failure of the agents to advise him that he should file an amended return in 1963 was misleading. He asked Cohen if he should file an amended return and was told that the agents would consider only his original return in preparing their report. This is no more than a factual statement. It was not shown to be false or deceitful.
55
Cumulative Misrepresentations. The explication of a case in factual and legal segments can distort the overall picture of what really happened. Therefore, we have carefully reviewed the record as a whole but still cannot find that Prudden sustained his burden of proving fraud, deceit and trickery. Goodman v. United States, 285 F.Supp. 245 (C.D.Cal.1968), which was relied on by the District Court is distinguishable. Most noticeably, in that case the taxpayer had only a grammar school education and was affirmatively led to believe that the information which he was giving the revenue agents was part of the investigation of another taxpayer. That is not near this case on either count.
56
Any reasonable person is bound to be aware that the filing of an incorrect tax return may result in a charge of wrongdoing. If common sense and knowledge are not enough, then the warning at the bottom of every tax form which the taxpayer must sign before filing, should suffice.30 The appearance of the revenue agent at the door, in itself, ought in no way to dispel this knowledge of a potential criminal charge. Rather, when the agent says he is there to examine the taxpayer's books, the taxpayer's concern should intensify. We find it entirely implausible for Prudden, a well-educated businessman with a law degree and experience in the tax field, to claim that he did not know that the investigation could lead to criminal charges and that after fifteen months of investigation by numerous special agents of his affairs in New York and Florida, he was surprised or shocked to find himself in a criminal case. When the record is taken most favorably to Prudden's position it falls markedly short of demonstrating by clear and convincing evidence that he was the victim of fraud, deceit or trickery. The suppression order is reversed and the case is remanded to the district court for further proceedings not inconsistent with this opinion.
57
Reversed and remanded.
58
ON PETITION FOR REHEARING AND PETITION FOR REHEARING EN BANC
PER CURIAM:
59
The Petition for Rehearing is denied and no member of this panel nor Judge in regular active service on the Court having requested that the Court be polled on rehearing en banc, (Rule 35 Federal Rules of Appellate Procedures; Local Fifth Circuit Rule 12) the Petition for Rehearing En Banc is denied.
1
305 F.Supp. 110 (M.D.Fla.1969)
2
Prudden testified that Mrs. Smith had merely been a statistician and at the time of these examinations she was not a corporate officer but was acting as an independent agent on an hourly pay basis. The ownership of substantially all the FCA stock was held in trusts, of which Prudden was co-trustee for his sons
3
'Dear Mr. Prudden:
I presume that you have retrieved from storage the bank statements and canceled checks of Research and Development, Ltd.'s two bank accounts.
Please forward them to me in care of this office. By doing so, we will both benefit in that you will be saved a considerable amount of time upon your return to Florida and prior to your return, I will be able to proceed with my examination of F C A and subsidiaries.
You have been most cooperative in furnishing information and in giving of your time in connection with this examination; therefore, I feel sure that you will give your immediate attention to this matter.
Sincerely,'
4
'Dear Mr. Prudden:
Before you left on the 9th of August you made copies of some papers for me which I left in your office by mistake. I would appreciate it if you would have your secretary, Mrs. Smith, make them available to me. It is necessary that I have them to properly verify your returns. The copies were of the following three items: 1) a note from H. B. Bradford, CPA advising you on the proper way to handle costs relative to the sale of 1st S.E. stock which were incurred after the sale; 2) a list of 1st S.E. subsidiaries with addresses and locations; and 3) your letter to Kent, re: $52,800.00 escrowed money (it is not absolutely necessary that I have this).
A fourth item which I need but failed to ask for during your last visit is a copy of the schedule you recently prepared showing a computation of the Palmer Fidelity loss.
At my request the Government is moving me to our Ocala, Florida office, in order that my wife and I can take advantage of the educational facilities at the University of Florida. Your return along with the others under examination are being transferred to Agent Lewis E. Stanley of this office. Please address all future correspondence to him.
You have been most cooperative in this examination to date, I trust that you will extend the same courtesy to Agent Stanley.
Sincerely.'
5
Lexow testified that the information was sought to make his final report on the matter complete and that he did not withhold the disclosure of Cohen's assignment because of any fear such disclosure would cut off the flow of information
6
Although the evidence in question was obtained prior to the decision in Miranda, the Supreme Court applied that decision to persons whose trials had not begun as of June 13, 1966, regardless of when the alleged constitutional infirmity occurred. Johnson v. New Jersey, 384 U.S. 719, 734, 86 S.Ct. 1772, 1781, 16 L.Ed.2d 882 (1966). In Jenkins v. Delaware, 395 U.S. 213, 89 S.Ct. 1677, 23 L.Ed.2d 253 (1969), the Court limited the retroactivity of the rule by refusing to apply it to retrials commenced after the date of the decision even though the original trial preceded Miranda. It is appropriate to here note that the District Court was under the impression that Prudden did not rely on Miranda and the order suppressing evidence was expressly declared to be independent of any application of Miranda to the instant case. The constitutional dimensions of that rule and the fact that this cause must be remanded for further proceedings where the point might be raised, indicate that we should rule on it now
7
United States v. Dickerson, 413 F.2d 1111 (7th Cir. 1969), and United States v. Habig, 413 F.2d 1108 (7th Cir. 1969), cert. den., 396 U.S. 1014, 90 S.Ct. 559, 24 L.Ed.2d 506 (1970). (The Miranda issue was not presented to the Court in the Application for Writ of Certiorari.). See also United States v. Campione, 416 F.2d 486 (7th Cir. 1969)
8
We held that routine tax investigations were not criminal in nature, and thus were beyond the protection of the Fifth Amendment without regard to the presence or absence of compulsion. Mathis v. United States, 376 F.2d 595 (5th Cir. 1967)
9
Cf. United States v. Marlow, 423 F.2d 1064 (5th Cir. 1970), where a routine request for a driver's license made without Miranda warnings produced a wrongfully acquired credit card that led to the driver's conviction for obstructing the mails
10
There are other incongruities in Dickerson. It purports to apply Mathis but admittedly does not use Mathis' standard. In Mathis a routine examination by a regular revenue agent prior to any reference of the case to the Intelligence Division of the Revenue Service, was voided. Dickerson does not apply this rule, it admits incriminations by the taxpayer produced by the regular agent and only suppresses information obtained after the case had been transferred to the Intelligence Division. Since Mathis did not recognize any distinction between the regular and special agent, the compulsive effect of the agent's official status is identical. Unless the regulations of the Internal Revenue Service are changed or United States v. Heffner, infra n. 12, is not followed, Dickerson will have no effect as precedent. Prior to its rendition, the Revenue Service adopted a regulation requiring special agents to give Miranda type warnings on their first contact with taxpayers. In recognition of the fact that Dickerson represented a departure from the present state of the law, the court determined that its holding would only apply to interrogations taking place after the date of the decision. Thus only Dickerson and the taxpayer in the companion case of Habig will be affected. If Prudden's case were now presented to that circuit he would get no benefit from that ruling since the investigations here involved took place in 1963 and 1964
11
The Supreme Court in Miranda, defined custodial interrogation to mean questioning initiated by law enforcement officers after a person has been taken into custody or otherwise deprived of his freedom in any significant way. The Court also emphasized that the 'salient features' of the cases there decided showed 'incommunicado interrogation of individuals in a police-dominated atmosphere.' 348 U.S. at 445, 86 S.Ct. at 1612
12
We recognize that custodial interrogation can occur beyond the confines of the station house. For example, in Orozco v. Texas, 394 U.S. 324, 89 S.Ct. 1095, 22 L.Ed.2d 311 (1969), the Court applied Miranda to incriminating evidence obtained by questioning the suspect in his own room in a boarding house. The suspect was alone and in the custody of four police officers who questioned him. Under those circumstances, Orozco was held to be significantly deprived of his freedom But Orozco merely stands for the rule that 'a compelling atmosphere' can exist outside of the station house, it does not hold that any inquiry by a government official carries such an element of intimidation as amounts to compulsion to self-in-crimination. The majority opinion emphatically states: 'We do not, as the dissent implies, expand or extend to the slightest extent our Miranda decision.' See also United States v. Lackey, 413 F.2d 655 (7th Cir. 1969), where a recorded courthouse basement interrogation of the taxpayer alone was held to be within Miranda's ambit. No comparable significant deprivation of freedom or compelling atmosphere ever existed in the case now before us
13
See e.g., Ping v. United States, 407 F.2d 157 (8th Cir.), cert. den., 395 U.S. 926, 89 S.Ct. 1784, 23 L.Ed.2d 244 (1969); Spinney v. United States, 385 F.2d 908 (1st Cir.), cert. den., 390 U.S. 921, 88 S.Ct. 854, 19 L.Ed.2d 981 (1967); Schlinsky v. United States, 379 F.2d 735 (1st Cir.), cert. den., 389 U.S. 920, 88 S.Ct. 236, 19 L.Ed.2d 265 (1967)
14
An exhaustive collection of such authorities is set out in United States v. Squeri, 398 F.2d 785, 789-790 (2d Cir. 1968). See also United States v. White, 417 F.2d 89, 91 (2d Cir. 1969), cert. den. 397 U.S. 912, 90 S.Ct. 910, 25 L.Ed.2d 92 (1970) in which the Second Circuit explicitly refused to follow Dickerson, and the cases there cited, and Spahr v. United States, 409 F.2d 1303 (9th Cir.), cert. den. 396 U.S. 840, 90 S.Ct. 102, 24 L.Ed.2d 91 (1969). The only contrary authorities are the decisions of the Seventh Circuit in United States v. Dickerson and United States v. Habig, supra, and the District Court rulings noted in Dickerson, 413 F.2d at 1114, n. 6. See also United States v. Casias, 306 F.Supp. 166 (D.Colo.1969). Though not as circumscribed as Dickerson, our holding here may have limited effect as precedent for the same reason mentioned in note 8, supra. Since May of 1967 the Internal Revenue Service has required Special Agents to give the taxpayer all essential Miranda warnings and advice at their initial conference. See I.R.S. News Release IR-949 (1969 CCH Fed.Tax Rptr. P6946). The Fourth Circuit has recently held that in tax investigations occurring after the inception of this policy the IRS is required to comply with its own rule on the basis of United States ex rel. Accardi v. Shaughnessy, 347 U.S. 260, 74 S.Ct. 499, 98 L.Ed. 681 (1954). United States v. Heffner, 420 F.2d 809 (4th Cir. 1969). Since this question is not presented by this appeal, we refrain from expressing any direct opinion on it. It is appropriate, however, that we now note that our holding here accords no retroactive significance to the promulgation of this administrative policy. That the Internal Revenue Service has voluntarily taken upon itself to now give a taxpayer Miranda type warnings and advice at the Special Agent's first meeting with him, does not give taxpayers questioned before the promulgation of this order additional constitutional rights
15
409 F.2d at 835
16
The facts in Marcus, which was decided after the instant appeal was argued, do differ from the case sub judice. In the words of that opinion:
'There is testimony in the record * * * that at the first interview the Internal Revenue agents informed Marcus that they were Special Agents attached to the Intelligence Division, which handles only criminal investigations, that he had a right to remain silent, and that anything he said could be used against him. Likewise, it is undisputed that the agents failed to inform Marcus that he had a right to an attorney, as they were required to do if Marcus was entitled to a Miranda warning.' 422 F.2d at 756.
These factual differences do not serve to distinguish Marcus. The rights protected by Miranda are constitutional in nature and if Miranda warnings and advices are required at all, they are all required for unconstitutionality knows no gradations.
17
422 F.2d at 756
18
305 F.Supp. at 111
19
Galena Oaks Corporation v. Scofield, 218 F.2d 217 (5th Cir. 1954); Mayo v. Pioneer Bank & Trust Co., 297 F.2d 392 (5th Cir. 1961)
20
United States v. United States Gypsum Co., 333 U.S. 364, 394-395, 68 S.Ct. 525, 541-542, 92 L.Ed. 746 (1948); United States v. Singer Mfg. Co., 374 U.S. 174, 194 n. 9, 83 S.Ct. 1773, 1784 n. 9, 10 L.Ed.2d 823 (1963); Minneapolis-Moline, Inc. v. Bryan, 415 F.2d 841 (5th Cir. 1969)
21
Gouled v. United States, 255 U.S. 298, 41 S.Ct. 261, 65 L.Ed. 647 (1921); Spahr v. United States, 409 F.2d 1303 (9th Cir. 1969), cert. den., 396 U.S. 840, 90 S.Ct. 102, 24 L.Ed.2d 91 (1969); United States v. Sclafani, 265 F.2d 408 (2d Cir.), cert. den., 360 U.S. 918, 79 S.Ct. 1436, 3 L.Ed.2d 1534 (1959)
We explicitly reject the government's contention that the agents were free to use fraud, deceit or trickery. In cases where the IRS agents are obtaining consent to examine documents, they cannot gain such consent by affirmatively misrepresenting the nature of the search.
22
Nardone v. United States, 308 U.S. 338, 60 S.Ct. 266, 84 L.Ed.2d 307 (1939); Der Garabedian v. United States, 372 F.2d 697 (5th Cir. 1967)
23
305 F.Supp. at 111
24
See United States v. Sclafani, 265 F.2d 408 (2d Cir.), cert. den., 360 U.S. 918, 79 S.Ct. 1436, 3 L.Ed.2d 1534 (1959); c.f., Avery v. Clearly, 132 U.S. 604, 10 S.Ct. 220, 33 L.Ed. 469 (1890); Atilus v. United States, 406 F.2d 694, 698 (5th Cir. 1969); American Nat'l Ins. Co., etc. v. Murray, 383 F.2d 81 (5th Cir. 1967)
25
409 F.2d at 1306, quoting, 265 F.2d at 414-415
26
265 F.2d at 415. See United States v. Squeri, 398 F.2d 785, 788 (2d Cir. 1968): 'The information that a taxpayer's returns are under audit gives notice of the possibility of criminal prosecution regardless of whether the agents contemplate civil or criminal action when they speak to him.'
27
Jett v. Zink, 362 F.2d 723, 729 (5th Cir. 1966), cert. den., Chamberlain v. Zink, 385 U.S. 987, 87 S.Ct. 597, 17 L.Ed.2d 448 (1967)
28
This letter is set out at note 3 supra
29
This letter is set out at note 4 supra
30
The warning states: 'Under penalties of perjury, I declare that I have examined this return, including accompanying schedules and statements, and to the best of my knowledge and belief it is true, correct, and complete.'
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,; . .
,,‘:,L : ~,,.,
a E- 0 GENERAL
Hr.’‘ikml
Blaolwetll 0p1n.tm IV?.,
WW~658
County Attorney
, ’
Travla county Ret Questions relating to whet 'Items
Austin, Texas are court oosts and payable ae
such by t2q State under the rwl-
Dear Mr. Blaokuellt sions af Artlole 39120,V.C.ii ,
You have requested our oplnlonon the follouiag ques-
t1QM t
"Are t& follwlrtg itom OQurt owt and as
tmohpayableby the&&a of hru m&r fk.
prwl8iQM Qf 4rt.39la* 8w. 1:
:. .,
c ‘,.
‘fee grwided for %n
8 ottltts, aud tmtod,
. . .ylBoktoirilwttr,
~~bresoh8uit~tby~“Eszeo qment caqt-
iiaiipweuaatto the pr~ims ~4%Title83,E pter 14,
- -
"
MP. Tom ElaokueJl, page 2 (WW-658) .
Vernon’s Civil Statutes, as ,amended, it Is alleged t
‘.
W~is suit, is brought pursuant to and ‘:
undak the terms and provisions of Title 83,
I.’ Chapter 14, Vernon’s Civil Sttitutes as
Leo;, and particularly Artiale 5$21b-12(b)
Venue is in Travis County, Texas, as
this is*a suit for taxes other than ad valorem
am& venue In such suits’ Is plaqed in Travis
County Texas by Articles 7076and m76a, Ver-
noq’s Eivil Statutes, 1925, as amended.”
195 S.W.28 955'
2 a ruit to reoover
d under roteat.
21b-1, e t seq. the
taxes levied iy
the State aga%ast an employer of lebor within the State.”
.
‘In view of the foregoing,it is our opinion that
suit8 broqht Ipr the Texas Emp opnent q#$?ggo’,~ g:
ewwy of dolit&mmt oontribu ion0 purs
plqmnt Camirsion Aat are nst$ts for de1 uent,taxesn and
are therefore exaepted from the provisions I”0p the statutes levy-
&ng e,libnry fee as costs.
You are therefore advisedthat library fees prwided
for utder the powirions ol Artiolee 17G?a-1 et seq. should
not be taxed en. oorts ,In a suit brought by the Texas &ployment
Cdraiott for the reowery of taxes Levied pursuant to the pro-
~2% of WCLo 83, Chapter 14, VWton~s Civil statutes, as
.
., x
&lole 3927. Revised Civil Statutes of Texas.. 1925,
as amended, providei ih part as follows:
: -1’ ?4’l%eolerks of the Dfstriot Courts Feym;;zh.
the8
up to for ,their
servloes t
I(. . .
nAbstractiug judgment
,
”. . .
:
aIssuiug each exi3cution
.
t ‘1 . l .
i
i.
,. :
- ’
I
Tom8Jiokwell, pgi 3 W-658) ‘,,
for suohr@viors fixed thi8b;t,UtdWOh
fee 8h a llk.due a nd p ep%a l to th e Wflw of
th o emlia t& lele~ 0 thodoakmt3ngofreh
8El beecxNlduedee~
by t& RLstriot
_
Cluk~aruohd~tlne.
Gi
fOO8OOlhOokdinOXOB88Of fb8WUkt#O8ari Ted
by thl8 A8t &tall upon order of the I#strlot
‘, ‘Jt#lgek reftmdd tathe puW ylng rrooh’ex-
0088 iXt -t.*. (47h818 QIM P
Bin6e tite foor fw in Artlels 3927 are spa-
ovided
. O%fhd.&bi8~td 'Leglstture to k fees "in oivll
,~ ‘,
h8eS “ud8bbOO tb, #lalature brr lutlmrimd the Judge bf
the d8triat Goplrf t0 lroribe one foe in 110~ of the fee6
t prerorlbod in lib8 Aat p"or the rervioo8 of $b M&riot Clerk,
it is our oplalon &et roh of the foor for the servlcea
li@ed $a Art1010 3W ue p r o p erlly 88088ad as mtrt oosts.
VOti0~k~8 oiril 6tatrik8t pre8OribeS
tha fearui%%.3 18 entitled to rewlve for services
8Otim8 u8tOd 18 I’OtUM Of eXOOU-
OlCpDMe8 of a suit
the loedng party.*
Btmddngareturnof
erder of the Court In
a oivll aa80. It 18 OWN OpbiOtt wt tb W iS PI’OPOrly
astwmed a8 oourt 008t8.
.
t\.
..
.
.
. . /-
.
I&. TOB Blackwell, page 4 (~~-658)
In view of the foregoing you are advised that the
library fee (except in suits for delinquent taxes), iesuing
exeoutlon,issuing abstract of,judgment, issuing execution
and/or abstract of judgment to renew judgment, and .Sherlffls
fee ror making return 0r execution, are Items 0r court costs.
IX Attortiey Qeneral~aOpinion ww-628 (1959), it IS
&&ted t
“It is noted that the prohibitions con-
tained in Seotiona 1 and 3 of Article 39120,
Vernon”6 Civil Statutes, concerning the pay-
sent of rees ‘or oommiesions by the State do
not apply to the payment 0r costs in civil
oases by the State where the fees earned oon-
stitute a part of the cost assessed against
bhe State ln a partioular case. Thewore,
8uoh cost oust be pald by the State as pro-,
vlded by law rather than as a fee to the
ln#lvidual orrloer . ‘I
Ia vi& of ths foregoIng, Items listed above as
rein& costs may be puid by the State. The County Clerk’s
~4’~ for recordfng an abstract of judgment is not oourt
oo8tr and the State is prohibited from paying suah fee.
AttPrney Oencira%!.a Oplnlons Nos. NW-508 (1959), and WW-628
(1933).
In answer to your second question, the court ooeta
e-rated herein should be paid to the District Clbrk.
Attorney Cteneralls Opinion ww-628 (1959).
SUMMARY
The library fee provided for in Artlolee
17028-1, Vernon’s Civil Statutes, et seq.,
is speo1flcally taxed aa court costs in
civil oases, with the exoeption of suita
for delinquent taxes. -es listed in
Artlale 39m, Vernon’e~ Civil StaWtes, are
taxed as oourt costs. The sh0rirrts fee.
ror return of execution provided for In
Arfiicle 3933, Vernon’0 Civil Statutes, is
taxed as court costs. The County Clerk’s
fee for recording an abstract of judgobant
9
Is not court coetr. Thoee feee linted
;E as court caste my be paid by the
The libraryroe in oa8ea of euits
for d;linquenttaxe8,asx¶the ,CountyClerk's
ree fbr ncordi#q lbrtrwta of judgmnt ruy
not k pa14 by th, state.
Your8 very truly,
WILL WILSOW
Attormy aeneralot 'Ibur
L. P. Lollal?,
CJwlrmn
mrvln 1. Sethtell.
mmr1.r D. Uabmnir
p& uz, Jr.
.
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Opinion issued November 21, 2017
In The
Court of Appeals
For The
First District of Texas
————————————
NO. 01-16-00899-CV
———————————
WEATHERFORD U.S., L.P., Appellant
V.
SPITZER INDUSTRIES, INC., Appellee
On Appeal from the 80th District Court
Harris County, Texas
Trial Court Case No. 2014-02648
MEMORANDUM OPINION
Appellant, Weatherford U.S., L.P., has filed an unopposed motion to dismiss
this appeal. No opinion has issued in this appeal. Accordingly, we grant the motion
and dismiss the appeal. See TEX. R. APP. P. 42.1(a)(1). We dismiss any other pending
motions as moot.
PER CURIAM
Panel consists of Chief Justice Radack and Justices Higley and Bland.
2
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Matter of Root v Root (2018 NY Slip Op 03843)
Matter of Root v Root
2018 NY Slip Op 03843
Decided on May 30, 2018
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 May 30, 2018
SUPREME COURT OF THE STATE OF NEW YORK
Appellate Division, Second Judicial Department
LEONARD B. AUSTIN, J.P.
SHERI S. ROMAN
JEFFREY A. COHEN
BETSY BARROS, JJ.
2016-06785
(Docket No. F-9988-12)
[*1]In the Matter of Rhonda Root, respondent,
vBradford Root, appellant.
Daniel L. Pagano, Yorktown Heights, NY, for appellant.
Rhonda Root, Scarsdale, NY, respondent pro se.
DECISION & ORDER
In a proceeding pursuant to Family Court Act article 4, the father appeals from an order of the Family Court, Westchester County (Nilda Morales Horowitz, J.), dated June 13, 2016. The order denied the father's objections to an order of the same court (Rosa Cabanillas-Thompson, S.M.), dated February 5, 2016, which, after a hearing, found that one of the parties' children was constructively emancipated, and thus that the father was not entitled to an offset against his child support obligation for the amount he was expending to support that child.
ORDERED that the order dated June 13, 2016, is reversed, on the law, without costs and disbursements, and the matter is remitted to the Family Court, Westchester County, for a recalculation of the father's child support obligation.
The parties were married in 1992, and have two children together. The parties were divorced by judgment of divorce dated May 30, 2012. In a stipulation of settlement which was incorporated but not merged into the judgment of divorce, the parties agreed to joint custody of their children, with residential custody to the mother. Pursuant to the judgment, the father was obligated to pay the mother child support and a pro rata share of certain add-on expenses.
In August 2015, the father filed a petition to modify his support obligation. The father argued that the parties' son had moved in with him and, therefore, he was entitled to an offset against his child support obligation for the amount he was expending to support that child. The mother opposed the petition, arguing that the father was not entitled to an offset because the son was constructively emancipated. After a hearing, the Support Magistrate issued an order in which she found that the child was constructively emancipated, and thus that the father was not entitled to an offset against his child support obligation for the amount he was expending to support that child. The Family Court denied the father's objections to the Support Magistrate's order, and the father appeals.
We conclude that the Support Magistrate should not have found that the son was constructively emancipated, and thus that the father was not entitled to an offset against his child support obligation for the amount he was expending to support that child. A child may be deemed [*2]constructively emancipated if, without cause, the child withdraws from parental supervision and control (see Diaz v Gonzalez, 115 AD3d 904, 905; Matter of Lowe v Lowe, 67 AD3d 682, 683). Thus, a child of employable age and in full possession of his or her faculties who voluntarily and without cause abandons his or her home, against the will of the parents and for the purpose of avoiding parental control, forfeits the right to demand support (see Matter of Dejesus v Dejesus, 152 AD3d 585; Matter of Malloy v O'Gorman, 139 AD3d 733, 735). The burden of proof as to emancipation is on the party asserting it (see Matter of Basile v Wiggs, 156 AD3d 619, 621; Matter of Dejesus v Dejesus, 152 AD3d at 586; Matter of Malloy v O'Gorman, 139 AD3d at 735).
Here, the mother failed to sustain her burden of establishing that the parties' son was constructively emancipated. The son's move from one parent's home to the other parent's home did not constitute constructive emancipation, as he was neither self-supporting nor free from parental control (see Matter of Burns v Ross, 19 AD3d 801, 802). Accordingly, the matter must be remitted to the Family Court, Westchester County, for a recalculation of the father's child support obligation.
AUSTIN, J.P., ROMAN, COHEN and BARROS, JJ., concur.
ENTER:
Aprilanne Agostino
Clerk of the Court
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381 Mass. 386 (1980)
409 N.E.2d 783
DAVID S. VOKEY & another[1]
vs.
MASSACHUSETTS INSURERS INSOLVENCY FUND.
Supreme Judicial Court of Massachusetts, Middlesex.
April 8, 1980.
August 28, 1980.
Present: HENNESSEY, C.J., QUIRICO, BRAUCHER, WILKINS, & ABRAMS, JJ.
Steven H. Bowen for the plaintiffs.
Joseph B. Bertrand (Stephen L. Mitchell with him) for the defendant.
QUIRICO, J.
This is an appeal by the plaintiffs from a judgment of the Superior Court allowing a motion for the defendant, Massachusetts Insurers Insolvency Fund (Fund), to dismiss the action. The question presented is whether an injured person who has recovered under uninsured motorist coverage, because of the insolvency of the tortfeasor's insurer, an amount equal to the Fund's liability, may recover additional amounts from the Fund under the tortfeasor's insurance policy. The parties presented the appeal to the Appeals *387 Court upon an agreed statement of the case in lieu of a record on appeal. Mass. R.A.P. 8 (a), as amended, 378 Mass. 924 (1979). We granted direct appellate review. We affirm the judgment of dismissal.
We summarize the agreed facts. The plaintiffs (hereinafter referred to as David and Mary Ellen) are husband and wife. On August 12, 1973, David was injured when he was a passenger on a motorcycle which was hit from behind by another motorcycle operated by Philip G. Knowlton, who is not involved in this appeal. A jury found that Philip G. Knowlton was 100% causally negligent. David obtained a judgment for $19,520.05 in his action for personal injuries, and Mary Ellen obtained a judgment for $3,306.34 in her action for loss of consortium.
The Knowlton motorcycle was insured by Summit Insurance Company of New York (Summit) under a policy providing coverage limits of $5,000 per person and $10,000 per accident. Summit subsequently became an insolvent insurer within the meaning of G.L.c. 175D, inserted by St. 1970, c. 261, § 1. The parties agree that the claims of both David and Mary Ellen are "covered claims" within the provisions of G.L.c. 175D.
At the time of the accident, Mary Ellen owned an automobile which was insured by American Policyholders' Insurance Company (APIC). The APIC policy included uninsured motorist coverage (coverage U), with liability limits of $10,000 per person and $20,000 per accident. David and Mary Ellen were both insured persons under this policy. The coverage U portion of the policy provided for arbitration in the event of failure to agree upon a claim, and provided that "the limit of liability stated in the declarations as applicable to `each person' is the limit of the company's liability for all damages, including damages for care or loss of services, because of bodily injury sustained by one person ... as the result of any one accident."
On June 20, 1977, the plaintiffs filed a formal demand for arbitration with the American Arbitration Association, asking $10,000 for David for his bodily injuries, and $10,000 *388 for Mary Ellen for her loss of consortium.[2] In response, APIC filed a complaint for declaratory relief in the Superior Court, seeking a declaration that the maximum amount available to both plaintiffs under coverage U was $10,000, and that Mary Ellen was not entitled under the terms of the coverage U section of the policy to recover damages for loss of consortium. APIC also sought a stay of the arbitration proceedings, which was rendered moot when APIC reached a settlement with David for $10,000, and David executed a release and trust agreement to APIC on March 17, 1979. Mary Ellen recovered nothing from APIC.
The plaintiffs filed the present complaint on April 6, 1979, seeking to require the Fund to pay Mary Ellen's judgment in full, and whatever part of the unsatisfied portion of David's judgment the court considered proper. The Fund filed a motion to dismiss the plaintiffs' complaint, and after a hearing the judge allowed the motion, and a judgment was entered dismissing the action. It is the plaintiffs' appeal from the judgment which is now before us.
The insolvency of Summit triggered the obligations of the Fund, which is "a nonprofit unincorporated legal entity" established to pay claims of insolvent insurers. G.L.c. 175D, §§ 1, 3. See Massachusetts Motor Vehicle Reinsurance Facility v. Commissioner of Ins., 379 Mass. 527, 530 (1980); Commissioner of Ins. v. Massachusetts Insurers Insolvency Fund, 373 Mass. 798, 799 (1977); Ferrari v. Toto, 9 Mass. App. Ct. 483, 486-487 (1980). The Fund statute, G.L.c. 175D, applies to all kinds of direct insurance, with certain exceptions not here relevant. Id. § 2.
Section 5 (1) (a) of c. 175D provides that the Fund shall "be obligated to the extent of the covered claims against the insolvent insurer...."[3] Therefore, the Fund's maximum *389 liability is $5,000 each to David and Mary Ellen, individually, or $10,000 to both for the accident, the limits of the Summit policy. Section 9 of the same chapter provides, in relevant part, that "[a]ny person having a claim against his insurer under any insolvency provision in his insurance policy which is also a covered claim shall be required to exhaust first his right under such policy. Any amount payable on a covered claim under this chapter shall be reduced by the amount of such recovery under the claimant's insurance policy."[4]
The filing of a claim by an injured person under the uninsured motorist provision of his own insurance policy is both proper and necessary under G.L.c. 175D, § 9, before recourse can be had to the Fund. See Spearman v. State Security Ins. Co., 57 Ill. App.3d 393, 395 (1978) (construing Ill. Rev. Stat. c. 73, § 1065.96 (1975), which is substantially similar to G.L.c. 175D, § 9). Accord, State Farm Mut. Auto. Liab. Ins. Co. v. Kiser, 168 N.J. Super. 230, 236 (1979), and cases cited therein.
The Fund argues that its liability under c. 175D is limited by the liability limits of the Summit policy, $5,000 per person and $10,000 per accident. It maintains that the second sentence of § 9, quoted above, requires that the $10,000 recovered by David be offset against these Summit policy limits, so that the Fund's total liability to David and Mary Ellen is zero. The plaintiffs would look to the Fund as a collateral source of recovery. They argue that David and *390 Mary Ellen have exhausted their rights[5] under coverage U, and that they may now seek recovery from the Fund to the extent of the Summit policy limits.
The plaintiffs' argument cannot stand. The purpose of the exhaustion requirement of the first sentence of § 9 is to render the Fund a source of last resort in the event of insolvency. The second sentence of § 9 states a clear legislative policy that any recovery to which a claimant is contractually entitled under his own insurance policy shall be offset to reduce the liability of the Fund.
This nonduplication of recovery provision, G.L.c. 175D, § 9, was taken from the National Association of Insurance Commissioners Post-Assessment Property and Liability Insurance Guaranty Model Act (hereinafter N.A.I.C. Model Act). See 2 Official N.A.I.C. Model Insurance Laws, Regulations and Guidelines § 12, at 540-8 (1977). Cases in other jurisdictions which have interpreted their nonduplication of recovery provisions from the N.A.I.C. Model Act have rejected collateral source arguments and have required offset of amounts recovered under uninsured motorist provisions of claimants' insurance policies. See King v. Jordan, 601 P.2d 273, 278 (Alas. 1979); Lucas v. Illinois Ins. Guar. Fund, 52 Ill. App.3d 237, 239 (1977); Prutzman v. Armstrong, 90 Wash.2d 118, 121-122 (1978). Cf. Florida Ins. Guar. Ass'n v. Dolan, 355 So.2d 141, 142 (Fla. Dist. Ct. App. 1978) (availability of alternate source of recovery *391 places plaintiff's claim outside definition of "covered claim" because it is not "unpaid").
Although the statutes construed in King and Lucas, supra, contained provisions limiting the respective State funds' liability to the limits of the insolvent insurers' policies,[6] in addition to requiring exhaustion and offset to avoid duplicate recovery, both the King court and the Lucas court relied on the nonduplication of recovery provisions similar to G.L.c. 175D, § 9.[7] Washington does not have liability limits, and relied solely on its nonduplication of recovery provision.[8] See Prutzman, supra.
The absence of statutory liability limits in G.L.c. 175D does not negate the effect of § 9, which is to require exhaustion by claimants through their own insurance policies, and offset of amounts recovered against liability of the Fund (which, logically, is coextensive with that of the insolvent insurer).
We hold that the judge correctly allowed the defendant's motion to dismiss the plaintiffs' complaint.
Judgment affirmed.
NOTES
[1] Mary Ellen Vokey.
[2] Although the parties do not include in their statement of agreed facts the fact that the plaintiffs first filed a claim and undertook negotiations with APIC, this was stated at oral argument.
[3] A "covered claim" is defined as "an unpaid claim, including one for unearned premiums, which arises out of and is within the coverage of an insurance policy to which this chapter applies issued by an insurer, if such insurer becomes an insolvent insurer and (a) the claimant or insured is a resident of the commonwealth; and (b) the property from which the claim arises is permanently located in the commonwealth." G.L.c. 175D, § 1 (2), as amended by St. 1975, c. 570, § 1. The Vokeys were at all material times residents of Massachusetts and, as stated in the text, the Fund concedes that their claims are "covered claims."
[4] The plaintiffs concede that, had Summit not become insolvent, they could not have proceeded under the coverage U portion of their APIC policy, but instead would have been limited to recovering $5,000 per person and $10,000 for the accident, the liability limits of the Summit policy. Thus David has already recovered twice what he would have without the insolvency.
[5] We note that David and Mary Ellen were represented throughout this litigation by the same law office. Presumably Mary Ellen could have recovered a pro rata share of the APIC settlement. The plaintiffs' attorney argues in his brief that either Mary Ellen had no right to recover under the APIC policy for loss of consortium, which is clearly incorrect on the basis of the portion of coverage U quoted in the text above, or "because [APIC's] payment to David S. Vokey of the full per-person limit of liability [under the APIC policy] exhausted the company's obligation to make payments on account of the damages sustained by both Vokeys as a result of the accident of August 12, 1973." The implicit assumption that payment to the husband is equivalent to payment to the wife is vestigial and archaic, and although this issue is not before us, we register our disapproval of the conduct of the litigation in this regard. Cf. Brown v. Brown, ante 231, 232 (1980).
[6] Alas. Stat. 21.80.100(a) (1978). Ill. Rev. Stat. c. 73, § 1065.84-3(i) (1975).
[7] The respective nonduplication of recovery provisions are Alas. Stat. 21.80.100 (1978) and Ill. Rev. Stat. c. 73, § 1065.96(a) (1975).
[8] Wash. Rev. Code 48.32.100(1) (1971).
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642 F.2d 448
Eudyv.Shefield
80-6004
UNITED STATES COURT OF APPEALS Fourth Circuit
1/9/81
1
E.D.N.C.
AFFIRMED
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38 F.3d 1213NOTICE: 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.
John Pete PERDUE, Jr., Plaintiff-Appellant,v.B. L. PENALOSA, Physician, Portsmouth City Jail; ZaboCorrection Food Service; Portsmouth City Jail,Defendants-Appellees.
No. 93-6313.
United States Court of Appeals, Fourth Circuit.
Submitted: June 21, 1993.Decided: October 13, 1994.
Appeal from the United States District Court for the Eastern District of Virginia, at Norfolk. Henry C. Morgan, Jr., District Judge. (CA-93-39-2)
John Pete Perdue, Jr., appellant pro se.
E.D.Va.
AFFIRMED.
OPINION
Before WIDENER, MURNAGHAN, and NIEMEYER, Circuit Judges.
PER CURIAM:
1
John Pete Perdue, Jr., appeals from the district court's order dismissing his action, under 42 U.S.C. Sec. 1983 (1988), for failure to comply with a court order. We affirm the dismissal, but on other grounds.
2
Perdue's complaint, stemming from a slip and fall injury sustained in the kitchen of Portsmouth City Jail ("the Jail"), alleged that Zabo Correction Food Service ("Zabo"), a private company providing food service for the Jail and apparently employing Perdue, provided issued unsafe footwear, and that Penalosa, the Jail physician, provided inadequate medical treatment for the resulting injury. Although naming the Jail as a defendant, Perdue alleged no claim for recovery against the Jail.
3
Finding no cognizable Sec. 1983 claim against the Jail and Zabo, the district court dismissed the case as to those parties. In an order continuing the action as to Penalosa and conditioning the filing of Perdue's suit on the payment of a filing fee, the court required Perdue to respond to two interrogatories, concerning the institutions in which he had been incarcerated during the preceding six months, within twenty days. The court cautioned Perdue that failure to comply could result in the dismissal of his case. Thirty-five days later, after receiving no answers to the interrogatories, the district court dismissed the case without prejudice.
4
Dismissal under Fed.R.Civ.P. 41(b) for failure to comply with a court order is reviewed under an abuse of discretion standard. Ballard v. Carlson, 882 F.2d 93, 96 (4th Cir.1989), cert. denied, 493 U.S. 1084 (1990). Before dismissing a case for failure to comply, the district court must balance four factors: (1) the degree of the plaintiff's personal responsibility, (2) the amount of resulting prejudice suffered by the defendant, (3) the existence of a protracted history of "deliberately proceeding in a dilatory fashion," and (4) the existence of less drastic sanctions. Doyle v. Murray, 938 F.2d 33, 34 (4th Cir.1991).
5
The district court's failure to consider the Doyle test before dismissing Perdue's claims constituted an abuse of discretion. The only factor that weighs against Perdue is the degree of his personal responsibility for the failure to comply. Consideration of the remaining three factors reveals the impropriety of dismissal at this stage of the case. See Chandler Leasing Corp. v. Lopez, 669 F.2d 919, 920 (4th Cir.1982) (dismissal inappropriate where only one of the four factors weighed against plaintiff).
6
However, dismissal is the appropriate result in this case because Perdue cannot state a cause of action against any of the Defendants under Sec. 1983. The Jail is not a "person" for purposes of Sec. 1983, and is an arm of the Commonwealth of Virginia entitled to Eleventh Amendment immunity. Will v. Michigan Dep't of State Police, 491 U.S. 58, 71 (1989); McCoy v. Chesapeake Correctional Ctr., 788 F.Supp. 890, 892-93 (E.D. Va.1992). Moreover, Perdue's failure to allege that the Jail deprived him of a right, privilege, or immunity secured by the Constitution or federal law precludes recovery under Sec. 1983. Inmates v. Owens, 561 F.2d 560, 563 (4th Cir.1977).
7
Zabo's alleged failure to provide adequate footwear does not rise to the level of a federal right shielded by Sec. 1983. Golden State Transit Corp. v. Los Angeles, 493 U.S. 103, 106 (1989). If Zabo indeed provided inadequate footwear, such act constituted mere negligence, which is not actionable under any possible theory of recovery for Perdue. See Wilson v. Seiter, 59 U.S.L.W. 4671, 4673 (U.S.1991); Daniels v. Williams, 474 U.S. 327, 328 (1986). Hence, Perdue has no actionable claim against Zabo.
8
Finally, as to Penalosa, we find that the five-hour delay in initially treating Perdue was not so unreasonable as to rise to the requisite level of "obduracy and wantonness" required for a finding of deliberate indifference to Perdue's serious medical needs. Whitley v. Albers, 475 U.S. 312, 319 (1986); cf. Loe v. Armistead, 582 F.2d 1291 (4th Cir.1978) (eleven-hour delay in seeing doctor, twenty-two hour delay in performing X-rays that doctor deemed medically necessary), cert. denied, 446 U.S. 928 (1980). Similarly, the three-day delay in performing X-rays did not rise to the level of inadequate medical treatment. Estelle v. Gamble, 429 U.S. 97, 107 (1976) (X-rays are a "matter for medical judgment," and the decision not to perform X-rays "does not represent cruel and unusual punishment.") At most, it constituted malpractice or negligent treatment, or a disagreement between Perdue and Penalosa as to appropriate treatment, claims not actionable under Sec. 1983. Id. at 105-06; Russell v. Sheffer, 528 F.2d 318 (4th Cir.1975). Finally, Perdue's failure to allege any personal responsibility by Penalosa for the nondelivery of the prescribed knee brace precludes recovery. Vinnedge v. Gibbs, 550 F.2d 926, 928 (4th Cir.1977).
9
Accordingly, pursuant to 28 U.S.C. Sec. 2106 (1988), we modify the dismissal to a dismissal with prejudice and affirm the district court's dismissal of this case. Perdue v. Penalosa, No. CA-93-39-2 (E.D. Va. Feb. 24, 1993). 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.
AFFIRMED AS MODIFIED
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Filed 3/26/14 P. v. Monzon 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, B249987
Plaintiff and Respondent, (Los Angeles County
Super. Ct. No. KA101787)
v.
AARON BELTRAN MONZON,
Defendant and Appellant.
APPEAL from a judgment of the Superior Court of Los Angeles County,
Jack P. Hunt, Judge. Affirmed.
Richard B. Lennon, under appointment by the Court of Appeal, for
Defendant and Appellant.
No appearance for Plaintiff and Respondent.
____________________________________
After waiving his rights to a preliminary hearing and trial, appellant pled no
contest to one count of residential burglary (Pen. Code, § 459). Based on the plea
agreement, appellant was sentenced to the low term of two years in state prison.
Thereafter, he filed a timely notice of appeal.
After examining the record, appointed appellate counsel filed a brief raising
no issues, but asking this court to independently review the record on appeal
pursuant to People v. Wende (1979) 25 Cal.3d 436, 441-442. (See Smith v.
Robbins (2000) 528 U.S. 259, 264.) On December 5, 2013, we advised appellant
he had 30 days within which to submit by brief or letter any contentions or
argument he wished this court to consider. No response was received.
This court has examined the entire record in accordance with People v.
Wende, supra, 25 Cal.3d at pages 441-442, and is satisfied appellant’s attorney has
fully complied with the responsibilities of counsel, and no arguable issues exist.
Accordingly, we affirm the judgment of conviction.
2
DISPOSITION
The judgment is affirmed.
NOT TO BE PUBLISHED IN THE OFFICIAL REPORTS.
MANELLA, J.
We concur:
EPSTEIN, P. J.
EDMON, J.*
__________________________________________________________________
* Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant
to article VI, section 6 of the California Constitution.
3
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951 F.2d 280
Raymond Leon ARNOLD, Petitioner-Appellant,v.R. Michael CODY; the Attorney General of the State ofOklahoma, Respondents-Appellees.
No. 91-7061.
United States Court of Appeals,Tenth Circuit.
Dec. 16, 1991.
Raymond Leon Arnold, pro se.
Susan Brimer Loving, Atty. Gen. of Okl., and Steven Spears Kerr, Asst. Atty. Gen., Oklahoma City, Okl. for respondents-appellees.
Before ANDERSON, BARRETT, and BRORBY, Circuit Judges.
STEPHEN H. ANDERSON, Circuit Judge.
1
After examining the briefs and appellate record, this panel has determined unanimously that oral argument would not materially assist the determination of this appeal. See Fed.R.App.P. 34(a); 10th Cir.R. 34.1.9. The case is therefore ordered submitted without oral argument.
2
Petitioner appeals from an Order of the district court denying his Petition for a Writ of Habeas Corpus filed pursuant to 28 U.S.C. § 2254. On appeal, he argues that the 1989 amendments to the Oklahoma Prison Overcrowding Emergency Powers Act,1 Okla.Stat. tit. 57, §§ 570-576, as applied to him violate the ex post facto clause of the United States Constitution. He maintains that the statutes prior to amendment, which provided him with emergency time credits, should apply to him. We agree and reverse the denial of habeas relief.
3
Prior to 1989, Petitioner was convicted after pleading guilty to child pornography2 and sentenced to twenty years imprisonment. Thereafter, he filed an application for post-conviction relief, alleging that amended section 574 was an improper imposition of an ex post facto law. The Oklahoma Court of Criminal Appeals denied habeas relief, concluding that the amendment which modified the amount of emergency credits did not violate the ex post facto clause.
4
Petitioner then filed an application for habeas relief in the federal district court, challenging application of the amended emergency credit law as an ex post facto violation. Because the parole board failed to recommend him for parole, he contended that under the amendment he was no longer eligible to earn emergency credits. Id. § 574.1. In addition, he argued that section 574 was amended to decrease the amount of credits which could be earned. Upon referral, the magistrate judge determined that there was no ex post facto question raised. The district court adopted the magistrate judge's findings and recommendations as its opinion. Petitioner appealed.
5
Article I of the Constitution provides that the States shall not pass ex post facto laws. Art. I, § 9, cl. 3; Art. I, § 10, cl. 1. The ex post facto prohibition forbids the enactment of a law imposing additional punishment on that prescribed at the time the offense was committed. Weaver v. Graham, 450 U.S. 24, 28, 101 S.Ct. 960, 963, 67 L.Ed.2d 17 (1981). In order for a law to be ex post facto, (1) it must be retrospective, applying to events occurring before enactment, and (2) it must disadvantage the prisoner. Id. at 29, 101 S.Ct. at 964. The law, however, need not impair a vested right. Id.; see Devine v. New Mexico Dep't of Corrections, 866 F.2d 339, 342 (10th Cir.1989) (certain retrospectively applied post-offense restrictions for supervised release are in violation of the ex post facto clause). "Thus, even if a statute merely alters penal provisions accorded by the grace of the legislature, it violates the Clause if it is both retrospective and more onerous than the law in effect on the date of the offense." Ekstrand v. Oklahoma, 791 P.2d 92, 94 (Okla.Crim.App.1990) (citing Weaver, 450 U.S. at 30, 101 S.Ct. at 965).
6
The Oklahoma Court of Criminal Appeals has addressed whether the emergency credits statute as amended in 1989 is an ex post facto law. Barnes v. Oklahoma, 791 P.2d 101 (Okla.Crim.App.1990). In holding that it is not an ex post facto law, the court reasoned as follows:
7
Under the reasoning of Weaver, 57 O.S.Supp.1989 § 574 is barred as to Petitioner by the ex post facto prohibitions of the State and federal constitutions if it both alters the consequences attached to a crime already completed and disadvantages the Petitioner. We agree that the new "cap" law may disadvantage the petitioner, for it reduces by half the "cap" credits which the petitioner may earn in the event that the prison population reaches ninety-five per cent (95%) of capacity, the governor declares a state of emergency and the petitioner meets the criteria of Section 573. The determinative issue is whether Section 574 as amended alters the consequences attached to the crime Petitioner committed. Section 574 is designed to provide the state with an administrative option to alleviate overcrowding in the Oklahoma prison system. Its use is triggered exclusively by the size of the prison population. The size of the prison population cannot be seen to be a consequence attached to the crime Petitioner committed. Rather it is a consequence of the statewide interaction between the convictions and sentences imposed and the prison space available. Section 574 as amended can be imposed only on the basis of events which occur after it was enacted, that is when the prison population reaches ninety-five percent (95%) of capacity. See 57 O.S.1989 Supp., § 574. Having found that the effect of Section 574 as amended on the petitioner is not a consequence of the crime he committed, and that the law is only triggered by events which occur after its enactment, we conclude that it is not retrospective. Since it is not retrospective, its application to the petitioner does not violate the ex post facto prohibitions of the state and federal constitutions.
8
Id. at 103.
9
In this case, Respondents agree with Petitioner that he is disadvantaged by the amendment and cannot receive the same number of credits he once could. The parties disagree, however, as to whether the amendment is a retrospective application. Respondents argue, based on Barnes, that the law is prospective, attaching only to a future event of prison overcrowding. Petitioner counters that Barnes is contrary to Ekstrand, which held that a retrospective application of the earned credits statute violated ex post facto laws. Also, Petitioner argues that the amendment is retrospective, because it restricts the possibility of a shortened prison stay.
10
In accordance with Petitioner's arguments, we do not agree with the court's reasoning or conclusion in Barnes. Instead, we believe the reasoning and conclusion of Ekstrand should also apply to emergency credits cases such as this one.
11
In Ekstrand, the Oklahoma Court of Criminal Appeals addressed whether amended Okla.Stat. tit. 57, § 138 (1988) was an ex post facto law when its application to prisoners resulted in the computing of fewer earned credits than under the statute before amendment, thereby lengthening the prisoners' sentences. 791 P.2d at 93. In resolving the issue, the court initially considered whether amended section 138 applied to prisoners convicted of crimes committed before the November 1, 1988, effective date of amended section 138. Id. at 94. The court found that amended section 138 was retrospective, because it applied to all inmates from the effective date of the amendment. Id. Second, the court considered whether the amendment was disadvantageous to prisoners. Id. After comparing the potential for earning credits before and after amendment, the court concluded that the amendment was disadvantageous. The amendment added requirements and reduced the number of credits which could be earned. Id. at 94-95. Because the reduction lengthened the amount of time a prisoner must be incarcerated, the court determined the amendment made the punishment for the crime more onerous than before the amendment. Id. at 95. The court, therefore, found an ex post facto violation. Id. Accordingly, the court held that "inmates who are disadvantaged by the amended statute, shall be entitled to the credits allotted under the statute effective on the date their crime was committed." Id.
12
We believe there is no difference between the earned credits statute in Ekstrand and the emergency credits statute at issue here. Thus, we conclude the reasoning in Ekstrand and not Barnes applies. As in Ekstrand, the amended statute is retrospectively applied to all prisoners regardless of when they committed their crimes. See Okla.Stat. tit. 57 § 574.1. Additionally, as the parties agree, the amended statute is disadvantageous. Section 574.1 has imposed an eligibility requirement, recommendation for parole, not imposed under the 1984 statute.
13
The purpose of the emergency credits statute is to permit earlier release to alleviate prison overcrowding. An emergency situation due to overcrowding as described in the statute cannot justify postponing a prisoner's release, which is the result caused by the amended statute in this case. By amending the emergency credits statute, the Oklahoma legislature made it more difficult for prisoners who have been denied parole to obtain release. In Ekstrand, such a disadvantage was set aside as an ex post facto violation. We conclude the situation with regard to emergency credits is the same.
14
Respondents fail to show any rational relationship between the amended emergency statute's purpose to correct an emergency situation and the result on certain prisoners, such as Petitioner, to keep them in prison longer. Because there is no compelling reason to deny Petitioner and others similarly situated emergency credits, we conclude that the district court erred in denying habeas corpus relief and in failing to hold that denial of emergency credits under the statutes prior to amendment is an ex post facto violation. Petitioner, while not entitled to immediate release, is entitled to have emergency credits currently calculated in accordance with the statute in effect at the time the offense he was convicted of was committed. See Wallace v. Cody, 951 F.2d 1170 (10th Cir.1991).
15
Petitioner's Application for a Certificate of Probable Cause and Motion for Leave to Proceed on Appeal without Prepayment of Costs or Fees are GRANTED. The judgment of the United States District Court for the Eastern District of Oklahoma is REVERSED. The action is REMANDED to the district court with directions to enter an order directing Respondents to calculate Petitioner's emergency credits under the 1984 statute. See Wallace, 951 F.2d 1170. Petitioner's Motion for Leave to Supplement Record is DENIED, because the materials Petitioner seeks to include in the record are already included.
1
The Oklahoma Prison Overcrowding Emergency Powers Act grants credits to qualifying prisoners when the inmate population exceeds 95% of the capacity of the correctional system for thirty consecutive days, and the governor either declares a state of emergency or fails to declare a state of emergency within fifteen days of the Department of Corrections' request for a declaration. Okla.Stat. tit. 57 §§ 571-573. The 1989 amendment to the Act provides that if a prisoner is denied parole, he cannot earn emergency credits. Id. § 574.1
2
The district court incorrectly stated that Petitioner was convicted of sodomy, attempted sodomy, lewd molestation, and engaging a child in child pornography. The record on appeal shows that Petitioner was convicted of only the latter offense
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#27184-aff in pt, rev in pt & rem-GAS
2015 S.D. 32
IN THE SUPREME COURT
OF THE
STATE OF SOUTH DAKOTA
****
ROBERT A. SCHERER, Plaintiff and Appellant,
v.
BETTY J. SCHERER, Defendant and Appellee.
****
APPEAL FROM THE CIRCUIT COURT OF
THE SECOND JUDICIAL CIRCUIT
MINNEHAHA COUNTY, SOUTH DAKOTA
****
THE HONORABLE PATRICIA C. RIEPEL
Judge
THE HONORABLE KATHLEEN CALDWELL
Retired Judge
****
STACY F. KOOISTRA
STEVEN J. MORGANS
SHARLA V. SVENNES of
Myers & Billion LLP
Sioux Falls, South Dakota Attorneys for plaintiff
and appellant.
GREGORY T. BREWERS of
Strange, Farrell, Johnson
& Brewers, PC
Sioux Falls, South Dakota Attorneys for defendant
and appellee.
****
CONSIDERED ON BRIEFS
ON MARCH 23, 2015
OPINION FILED 05/13/15
#27184
SEVERSON, Justice
[¶1.] Robert and Betty obtained a divorce on July 29, 2014. Robert appeals
the circuit court’s determination of marital assets, division of property, and alimony
award to Betty. He also appeals the court granting Betty a divorce on the grounds
of extreme cruelty. We reverse in part and remand.
Background
[¶2.] Robert Scherer and Betty Scherer met through mutual friends in 1997.
They began living together in 2000 and were married in 2002. At the time of the
divorce both Robert and Betty were 60 years old. This was Robert’s second
marriage. He has two adult children from the first marriage. Betty had two
previous marriages and has one adult son from her first marriage. When they
married, both parties were employed and each owned their own homes, which they
sold in order to buy a new home together. Betty worked as a licensed practical
nurse until 2005 when she was forced to retire and go on social security disability
due to repeated back injuries. Robert entered the marriage with what the court
characterized as a “fledgling business.” He also worked as a firefighter until his
retirement in 2005. At the time of the marriage, and thereafter, the parties agreed
to maintain separate bank accounts. The circuit court found that this was
primarily due to Robert wanting to keep his finances separate. They divided
financial responsibilities. Robert paid their house payment, utilities, and car
expenses, while Betty bought groceries, clothes, and items for inside and outside the
home.
-1-
#27184
[¶3.] The main dispute in this divorce is the inclusion of three businesses—
Scherer Corrugating and Machine, Inc., Scherer Design Engineering, Inc., and
Scherer Properties, LLC—in the marital estate. The court found that Robert made
several financial transactions in the year before he separated from Betty, which
showed a pattern of trying to minimize the marital estate. Robert sold 50% of
Scherer Properties, LLC for $100,000 to his son in December of 2010. No appraisal
was done at the time of the sale. The appraised value at the time of the divorce was
$1,695,000. In January of 2011, Robert sold 40% of Scherer Corrugating and
Machine, Inc. to his son and one of his employees for $1,025,000 each. He
guaranteed a $500,000 loan for each of them, and the son and employee each gave
Robert a promissory note for the additional $525,000. At the time of the divorce,
Scherer Design and Scherer Corrugating had an appraised value of $2,673,000. The
court noted that “no credible evidence of the value of any property owned by either
party at the time of their marriage” was offered.
[¶4.] After including Robert’s remaining interests in the businesses in the
marital estate, the court found that the value of the net marital estate totaled
$5,081,715. It awarded Robert more than half of the marital estate, including the
businesses. In order to effect an equitable division, the court ordered him to pay
cash to Betty in the amount of $2,000,000. He was to pay the sum of $500,000
immediately and the balance at a rate of $250,000 per year on each September 30,
beginning in 2015, plus interest at 5.25% per annum until the balance was paid in
full. Further, the court awarded Betty monthly alimony of $10,000 per month until
her death or remarriage; the alimony was to continue as an obligation of Robert’s
-2-
#27184
estate in the event he died before she did. The court granted a divorce to Betty on
the grounds of extreme cruelty. Robert appeals asserting that the court erred by:
(1) including premarital property in the marital estate, (2) granting Betty alimony
without considering the property division, (3) ordering the alimony as a continuing
obligation of Robert’s estate, (4) failing to consider that equity requires Robert
receive a greater share of the marital assets, and (5) granting Betty a divorce on the
grounds of extreme cruelty.
Standard of Review
[¶5.] “A trial court’s division of property will not be overturned by this
[C]ourt unless it appears the trial court abused its discretion.” Pellegrin v.
Pellegrin, 1998 S.D. 19, ¶ 10, 574 N.W.2d 644, 646. “‘Findings of fact are not set
aside unless this [C]ourt finds them to be clearly erroneous[.]’” Id. ¶ 9 (quoting
Osman v. Keating–Osman, 521 N.W.2d 655, 657 (S.D. 1994)).
Analysis
Property division
[¶6.] Robert contends that the court erred by including pre-marital property
in the marital estate. He explains that he and Betty maintained separate property,
such as the businesses, pursuant to their statutory right under SDCL 25-2-4. 1
Therefore, he argues the court improperly redefined the parties’ relationship when
it subjected these items to division. Robert’s position is contrary to our case law and
1. SDCL 25-2-4 provides: “Neither husband nor wife has any interest in the
property of the other, excepting their respective rights for support as
specifically provided by law, and except that neither can be excluded from the
other’s dwelling.”
-3-
#27184
misconstrues the right to maintain separate property. “[O]utside the context of
divorce, support, and homestead, marriage does not vest in one spouse an interest
in the other’s separate property.” Niesche v. Wilkinson, 2013 S.D. 90, ¶ 18, 841
N.W.2d 250, 255 (emphasis added). “When a divorce is granted, the courts may
make an equitable division of the property belonging to either or both, whether the
title to such property is in the name of the husband or the wife. In making such
division of the property, the court shall have regard for equity and the
circumstances of the parties.” SDCL 25-4-44. “In a divorce, a court is dividing the
spouses’ property irrespective of their ownership interests.” Niesche, 2013 S.D. 90,
¶ 21, 841 N.W.2d at 256.
[¶7.] Robert asserts that the unique facts—the parties married at an older
age after previous marriages and deliberately maintained separate finances—
distinguish this case. However, “‘[t]his Court has consistently held that the trial
court has discretion in determining how to consider premarital assets and gifts
during marriage; [whether to include or exclude them from the marital estate].’”
Billion v. Billion, 1996 S.D. 101, ¶ 20, 553 N.W.2d 226, 232 (quoting Strickland v.
Strickland, 470 N.W.2d 832, 836 (S.D. 1991)). The court has discretion to exclude
premarital assets from the marital estate, but it is not required to do so
automatically.
[¶8.] Second, Robert asserts that Betty made de minimis contributions to
the acquisition and maintenance of Robert’s businesses, and they should, therefore,
be set aside as non-marital property. A circuit court should consider the following
factors when making a property division: “(1) the duration of the marriage; (2) the
-4-
#27184
value of the property owned by the parties; (3) the ages of the parties; (4) the health
of the parties; (5) the competency of the parties to earn a living; (6) the contribution
of each party to the accumulation of the property; and (7) the income-producing
capacity of the parties’ assets.” Novak v. Novak, 2006 S.D. 34, ¶ 4, 713 N.W.2d 551,
552. Two conditions must be met before a court should set aside property as non-
marital. “Only in the case where one spouse has made no or de minimis
contributions to the acquisition or maintenance of an item of property and has no
need for support, should a court set it aside as ‘non-marital’ property.” Billion, 1996
S.D. 101, ¶ 21, 553 N.W.2d at 232.
[¶9.] Even if we assume Betty’s contributions to the acquisition or
maintenance of the businesses were de minimis, the circuit court found that Betty is
in need of support. Such a finding is not clearly erroneous. Betty has significant
health issues and experiences a lot of pain. She suffered a heart attack in 2005.
Further, she suffers from osteoarthritis that has a significant debilitating effect on
her hands, feet, and back, along with scoliosis of the spine that causes her to be
hunched over. A metal rod and 24 screws were placed in her back. She also has a
hyperthyroid condition. As a result, she is unable to work and has no income other
than social security disability benefits of $14,310 per year, of which $4,359 is
withheld for Medicare premiums. Therefore, the court did not abuse its discretion
by including the businesses in the marital estate.
Alimony
[¶10.] SDCL 25-4-41 grants the court discretion to “compel one party to make
such suitable allowance to the other party for support during the life of that other
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party or for a shorter period, as the court may deem just, having regard to the
circumstances of the parties represented; and the court may from time to time
modify its orders in these respects.” The circuit court should consider the following
factors when determining alimony: the parties’ (1) length of marriage; (2) earning
capacity; (3) financial condition after the property division; (4) age, health, and
physical condition; (5) station in life or social standing; (6) relative fault in the
termination of the marriage. Fausch v. Fausch, 2005 S.D. 63, ¶ 17, 697 N.W.2d 748,
755. We will not reverse a court’s decision regarding alimony absent an abuse of
discretion. Id. “A circuit court is required to consider the allocation of property and
spousal support together.” Terca v. Terca, 2008 S.D. 99, ¶ 28, 757 N.W.2d 319, 326.
“The symbiotic relationship between property division and spousal support requires
consideration of the two together, as an award of more assets can eliminate or
reduce the need for spousal support and vice versa.” Id. Therefore, “[t]he trial
court’s award of alimony and the division of property are considered together on
appeal to determine whether the trial court abused its discretion.” Krage v. Krage,
329 N.W.2d 878, 879 (S.D. 1983).
[¶11.] In this case, the court awarded Betty two million in cash along with
$10,000 monthly alimony to continue as an obligation of Robert’s estate in the event
that Betty does not remarry and lives longer than Robert. The record does not
reflect that the circuit court considered the allocation of property and spousal
support together. The court made no specific findings regarding Betty’s need for
alimony other than a general statement that Betty’s budget was $6,266 per month
and that she has a need for support because her expenses exceed her ability to pay
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them. At trial, Betty stated that an alimony payment would not be sufficient for
her needs absent the amount she sought from the property division. However, she
testified that if the court granted her requested property division, she did not need
alimony. The following colloquy occurred:
Counsel for Appellant: Okay what are you asking for there?
Betty: I am asking for $2,255,000.
Counsel: And on top of that, you’re asking for ten-thousand
dollars a month in alimony?
Betty: If I get the two million dollars, I don’t need the ten-
thousand dollars a month alimony.
Counsel: And if you get the $10,000 a month alimony, is it fair
to say then that you don’t need the 2,255,000?
Betty: No. That is not right. I still need the money.
“A party requesting such alimony ‘must establish that they have a need for support
and that their spouse has sufficient means and abilities to provide for part or all of
that need.’” Fausch, 2005 S.D. 63, ¶ 17, 697 N.W.2d at 755 (quoting Urban v.
Urban, 1998 S.D. 29, ¶ 7, 576 N.W.2d 873, 875). “[A]n alimony award is also based
upon the respective financial conditions of the parties after the property division . . .
.” Krage, 329 N.W.2d at 879 (emphasis added). The circuit court failed to consider
Betty’s admission that she would not need the alimony if granted the two million
dollars she sought from the property division, an amount that she ultimately
received from the division. In light of the property division and Betty’s admission,
the record does not support the court’s finding that Betty has demonstrated a need
for the amount of alimony granted in this case.
[¶12.] Further, Robert asserts that the court erred by granting alimony as an
ongoing obligation of his estate. We have previously stated that “[g]enerally, in the
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absence of an agreement between the spouses, the obligation to pay alimony ceases
on the death of the obligor spouse.” Lodde v. Lodde, 420 N.W.2d 20, 21 (S.D. 1988).
No such agreement existed between the parties in this case. However, as in Barton
v. Barton, “we need not determine whether a court may, under any factual
circumstances, extend an alimony obligation beyond the obligor’s death.” 2012 S.D.
44, ¶ 21, 815 N.W.2d 553, 559. In this case, the record does not reflect that Betty
has a “need for support beyond [Robert’s] death and thus, the court abused its
discretion in extending the alimony award beyond [Robert’s] death.” See id. ¶ 23.
Equity
[¶13.] Robert contends, in the alternative, that if we uphold the court’s
inclusion of the businesses in the marital estate, then the court erred by failing to
consider “equity and the circumstances of the parties[,]” according to SDCL 25-4-44.
He maintains that equity requires that he receive a greater share of the assets
because his contribution to the marital estate was substantially greater than
Betty’s contribution. As we have stated, we will not disturb the court’s decision
absent an abuse of discretion. Pellegrin, 1998 S.D. 19, ¶ 10, 574 N.W.2d at 646.
[¶14.] Contribution of the parties to the acquisition of marital assets is a
factor to be considered in dividing property, but it is not dispositive. Here, the court
properly considered all the factors when dividing the property. The parties were
married twelve years; no evidence existed as to the value of any property brought
into the marriage; they were each 60 years old at the time of the divorce; Betty
suffers serious health problems that impede her ability to earn an income; Robert
has some physical ailments but those do not limit his ability to work and earn an
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income; Robert earns substantial income while Betty receives only social security
disability; Robert developed the businesses while Betty worked until 2005, and
contributed to the home; and Robert would receive the only income producing asset.
In light of Robert’s work with the businesses, the court awarded him the businesses.
Further, even though the court found that he had tried to minimize the marital
estate by selling interests in the businesses, the court only included in the marital
estate the valuation of the interests which remained after the sales. Therefore, the
court did not abuse its discretion when it awarded Betty the sum of two million
dollars.
Extreme Cruelty
[¶15.] Robert contends that the circuit court erred by granting Betty a
divorce on the grounds of extreme cruelty. “Extreme cruelty is the infliction of
grievous bodily injury or grievous mental suffering upon the other, by one party to
the marriage.” SDCL 25-4-4. “In a marital setting, the definition of extreme cruelty
differs according to the personalities of the parties involved.” Rykhus v. Rykhus,
319 N.W.2d 167, 169 (S.D. 1982). “We must view the evidence in light of the full
context of the marriage and not in the narrow light of isolated incidents.” Id. The
court found that Robert was not available to Betty as a companion or housemate
due to his work schedule. Further, Betty testified that she felt betrayed by Robert
due to his admission to her of having sexual intercourse with her while she was
sleeping. This admission came after he was undressing her when he thought she
was asleep. Betty has serious health problems as outlined earlier in this opinion.
Supra ¶ 9. As a result, she had problems with the steps in the parties’ split-level
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home, but Robert liked the home and testified that Betty’s problems were from
having three dogs that needed to go out ten or more times each day. They often
argued about moving from the home. Both parties felt that they were not a priority
in each other’s life. The court also found that Robert would not reveal his financial
condition to Betty, insisted that their property be held separately, and engaged in a
pattern of trying to minimize the marital estate. Although the court found fault to
exist on both sides and that Robert was more at fault than Betty, the court’s
findings of fact on critical issues of fault largely recited what witnesses testified to
and lack a determination of which facts the court found were proven by a
preponderance of the evidence. Further, the conclusions of law are devoid of any
determination that extreme cruelty was proven from those facts. See SDCL 15-6-
52(a) (“In all actions tried upon the facts without a jury . . . the court shall . . . find
the facts specially and state separately its conclusions of law thereon . . . .”).
Accordingly, we reverse the circuit court’s grant of divorce on the grounds of
extreme cruelty.
Conclusion
[¶16.] The court properly exercised its discretion when making an equitable
division of the marital estate. However, it erred by failing to consider Betty’s need
for or an amount of alimony in light of the property division. Further, the court’s
findings and conclusions regarding the grounds of extreme cruelty are insufficient.
On remand, the court must consider the property division and alimony together to
determine if Betty has demonstrated a need for alimony, and it must determine
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#27184
whether extreme cruelty existed. We affirm in part, reverse in part, and remand for
further proceedings consistent with this opinion.
[¶17.] GILBERTSON, Chief Justice, and ZINTER, WILBUR and KERN,
Justices, concur.
-11-
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642 So.2d 1137 (1994)
John MACHT, Appellant,
v.
STATE of Florida, Appellee.
No. 93-3274.
District Court of Appeal of Florida, Fourth District.
September 21, 1994.
*1138 Richard L. Jorandby, Public Defender, and Mallorye G. Cunningham, Asst. Public Defender, West Palm Beach, for appellant.
Robert A. Butterworth, Atty. Gen. Tallahassee, and Ettie Feistmann, Asst. Atty. Gen., West Palm Beach, for appellee.
PER CURIAM.
We affirm appellant's conviction and sentence.
The specific error claimed here is that the trial court allowed the jury to view a transcript which was not "properly authenticated" of a tape recording introduced into evidence. Although this issue was not raised at trial, we wish to address it because other courts continue to cite our decision in Stanley v. State, 451 So.2d 897 (Fla. 4th DCA 1984), for the proposition that trial courts should not allow the use of transcripts of tapes when the tapes have been introduced into evidence.
We believe Hill v. State, 549 So.2d 179, 182 (Fla. 1989), supersedes the relevant language in Stanley and authorizes a jury to view an accurate transcript of an admitted tape recording as an aid in understanding the tape so long as the unadmitted transcript does not go back to the jury room or become a focal point of the trial.
Here, the arresting officer, who made the admitted tape, testified that the transcript accurately described his conversation with appellant which the officer had recorded commencing with the time he pulled over appellant's car. Appellant's contention that "proper authentication" requires the testimony of the individual who actually prepared the transcript or of an expert to testify that the transcript was accurate is not persuasive in light of the officer's testimony.[1]
Further, the trial court permitted the jury to read along on the transcript while the tape played, but advised the jury, "This transcript is not admitted and won't be admitted into evidence. The evidence is what's on the tape recording. If there's a conflict between what the transcript says and what you hear the tape says[,] the evidence is the tape, not the transcript and if you're if you hear a conflict[,] what's on the tape is what the evidence is. So we'll pass [the transcript] out *1139 and after the tape is played we'll collect these and these will not be in evidence and will not go back into the jury room with you." The transcripts were collected immediately after the playing of the tape, which occupied only three pages of the trial transcript on record.
GLICKSTEIN and STEVENSON, JJ., and OWEN, WILLIAM C., Jr., Senior Judge, concur.
NOTES
[1] In Grimes v. State, 244 So.2d 130, 134-35 (Fla. 1971), the trial court permitted an unadmitted transcript of a tape recorded statement to be published to the jury after the officer who took the statement testified that he had reviewed the recording and that the transcript accurately reproduced the contents of the recording. The supreme court explained that the transcript had been properly authenticated by the officer's testimony. "[The officer] was present when the recorded statement was taken and, in fact, took the recorded statement. In other words, the transcription was properly authenticated by the person who took the statement and who verified that the transcript was the same evidence as the recording." Id. at 135. This language of the supreme court suggests that the testimony of the transcriber himself is not essential. Rather, the testimony of one who verified the transcript's accuracy sufficed. Although Grimes differs from the present case in that apparently the tape recording was not admitted into evidence in Grimes, this difference does not change the analysis of the method by which an unadmitted transcript must be authenticated before its use as an aid in understanding a tape recording as it is played for the jury. See also Harris v. State, 619 So.2d 340, 343 (Fla. 1st DCA 1993) (authentication satisfied by one with personal knowledge of contents of tape recording).
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429 F.3d 1153
XIAODONG LI, Petitioner,v.ALBERTO R. GONZALES, Attorney General of the United States, Respondent.
No. 03-60670.
United States Court of Appeals, Fifth Circuit.
November 1, 2005.
Garrett M. White (argued), Houston, TX, David Andrew Cortman, Alliance Defense Fund, Lawrenceville, GA, for Li.
Gregory G. Katsas (argued), Civ. Div., Thomas Ward Hussey, Dir., Keith Ian Bernstein, OIL, Emily Anne Radford, Asst. Dir., Civ. Div., Imm. Lit., U.S. Dept. of Justice, Washington, DC, Hipolito Acosta, U.S. INS, Houston, TX, Caryl G. Thompson, U.S. INS, Dist. Directors Office, Attn: Joe A. Aguilar, New Orleans, LA, for Respondent.
Herbert Todd Nesom, Nesom's Law Office, Oakdale, LA. for Amicus Curiae Hebrew Imm. Aid Society.
Annigje Johanna Buwalda, Jubilee Campaign USA, Fairfax, VA, for Amicus Curiae Jubilee Campaign USA and China Aid Ass'n.
Michael J. Churgin, University of Texas School of Law, Austin, TX, for Amicus Curiae Imm. and Asylum Law Scholars and Clinicians.
Jeffrey J. Keyes, Briggs & Morgan, Minneapolis, MN, for Amici Curiae Amnesty Intern. USA, Minn. Advocates of Human Rights, Human Rights First, Asian Am. Justice Ctr. and Episcopal Migration Ministries.
Petition for Review of an Order from the Bureau of Immigration Appeals.
Before GARWOOD, BENAVIDES and STEWART, Circuit Judges.
PER CURIAM:
1
Xiaodong Li initially petitioned this court for review of a final order of the Board of Immigration Appeals (BIA) reversing the Immigration Judge's decision granting Li withholding of removal pursuant to 8 U.S.C. § 1253(h) of the Immigration and Nationality Act. This court affirmed the decision of the BIA and Li timely filed a petition for rehearing, which has not been ruled on; however, the Department of Homeland Security (DHS) petitioned the BIA to reopen the removal proceedings against Li based on new evidence and to permit the DHS to withdraw its appeal. On October 6, 2005, the BIA granted the DHS's motion, vacated its decision, and reinstated the Immigration Judges's February 28, 2000 decision granting Li withholding of removal. Li subsequently filed a motion to vacate the panel's decision.
2
Accordingly, Li's motion to vacate is GRANTED, the previous opinion of this panel published at 420 F.3d 500 (5th Cir.2005) is VACATED and Li's petition for review and his petition for rehearing are DISMISSED as moot. See Discipio v. Ashcroft, 417 F.3d 448, 450 (5th Cir.2005).
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176 Ga. App. 290 (1985)
335 S.E.2d 652
LAMONS
v.
THE STATE.
70489.
Court of Appeals of Georgia.
Decided September 12, 1985.
Rehearing Denied October 2, 1985.
Edward C. Stone, for appellant.
Thomas J. Charron, District Attorney, Debra H. Bernes, James F. Morris, Assistant District Attorneys, for appellee.
DEEN, Presiding Judge.
A Cobb County jury found appellant Lamons guilty on one count of violating the Dangerous Drug Act, OCGA § 16-13-70 et seq., by selling pills containing amitriptyline; and on one count of violating the Georgia Controlled Substances Act, OCGA § 16-13-1 et seq., by selling ephedrine (a non-scheduled drug) on the express representation that it was a controlled substance, methamphetamine. Lamons was sentenced to a total of ten years' imprisonment, with probation after seven years, plus a fine. On appeal Lamons enumerates eleven errors having to do with the allegedly impermissible placing of his character in evidence; the denial of his motions for mistrial, a directed *291 verdict of acquittal, judgment notwithstanding the guilty verdict, and a new trial; and the general grounds. In reviewing these enumerations we have treated together those that are related to one another. Held:
1. Examination of the trial transcript reveals that a witness' unsolicited remark might arguably have been construed as reflecting adversely on the defendant's character when the defendant himself had not placed his character in issue: the witness stated that during one of the alleged drug transactions the defendant "appeared to be under the influence and said he had been taking the [amitriptyline] pills." The trial court sustained defense counsel's objection and gave the jury curative instructions. In view of the other competent evidence adduced, it seems highly probable that this error did not contribute to the conviction. Johnson v. State, 238 Ga. 59, 61 (230 SE2d 869) (1976); Chester v. State, 144 Ga. App. 717 (242 SE2d 356) (1978). Therefore, neither a mistrial nor a new trial was warranted on this ground, and appellant's seventh and eighth enumerations are devoid of merit.
2. Scrutiny of the record indicates that appellant's case did not meet the statutory criteria for a directed verdict of acquittal. OCGA § 17-9-1. Moreover, as the trial court correctly pointed out in its order of February 6, 1985, a motion for judgment notwithstanding the verdict is inappropriate in a criminal proceeding and when, as in this case, it is made in the alternative with a motion for new trial, it amounts only to the latter and should be treated as the equivalent of a motion for new trial on the general grounds. Deen v. State, 216 Ga. 387 (116 SE2d 595) (1960); Russell v. State, 155 Ga. App. 555 (271 SE2d 689) (1980). The record further reveals that the court below correctly denied appellant's motion for new trial. The first, second, tenth, and eleventh enumerations of error are without merit.
3. The record reveals that sufficient competent evidence was presented at trial to authorize a reasonable trier of fact to find appellant guilty as charged beyond a reasonable doubt. Hampton v. State, 250 Ga. 805 (301 SE2d 274) (1983). The appellate court assesses the sufficiency of the evidence, not its weight. Barnes v. State, 171 Ga. App. 478 (320 SE2d 597) (1984). Appellant's third and fourth enumerations of error are also without merit.
4. Study of the trial transcript reveals that the alleged misconduct involving a conversation between a prosecution witness and a juror was thoroughly explored by the court outside the jury's presence. Both the witness (who had called the conversation to the court's attention) and the juror were questioned, and it was established to the court's satisfaction that the conversation was unrelated to the case sub judice. See Hardy v. State, 242 Ga. 702 (251 SE2d 289) (1978); Smith v. State, 218 Ga. 216 (126 SE2d 789) (1962). No mistrial *292 or new trial was authorized, and the fifth and sixth enumerations are without merit.
5. Also without merit is appellant's ninth enumeration of error, as examination of the entire record in this case reveals no reversible error of law.
Judgment affirmed. Banke, C. J., McMurray, P. J., Birdsong, P. J., Carley, Sognier, Pope and Benham, JJ., concur. Beasley, J., dissents.
BEASLEY, Judge, dissenting.
With respect to Division 4, I respectfully dissent.
On the second day of trial, after all the evidence was in and the court had denied defendant's motion for a directed verdict, and after defendant had rested without offering evidence and discussion began about charges, the district attorney brought to the attention of the court a phone conversation which the agent had with someone who had been present in court the day before but remained unidentified. The agent was the primary witness, had participated in the drug transactions being tried, and assisted the district attorney throughout the trial. The person had called the agent's office and left a number, and the agent was called back. The caller provided drug information, and although the agent was unable to learn from the tipster her name, he had reasoned that it was a juror. He did not remind her they could not converse during trial. Pursuing his theory as to identity, inquiry was made at court and it was found that juror Watson had made the call. She explained in chambers that she wanted to give the agent information about drug possession involving her ex-boyfriend and others and did not want to wait until the trial concluded; she had refused to disclose her identity because she did not think it would be proper to reveal it in the course of the call, but she said she did intend to introduce herself to the agent following this trial.
After determining not to declare a mistrial, the court instructed the juror not to discuss with the other jurors the matter of the phone call or the nature of the court's inquiry. She returned to the jury, closing arguments were made, and the court charged the jury. Since the juror had been late that morning, it was thought that the jury would understand that subject to have been the reason for the conference.
The impartiality of the jury is paramount to a fair trial and is scrupulously protected by the court, both by the often lengthy voir dire procedures in choosing a jury in the first place and in guarding the climate surrounding the jury while it is serving. The object is to assure that no influence, direct or indirect, can invade that zenith of impartiality.
"The policy of the law is to protect jurors from all [public opinion] *293 influences and temptations in the trial of criminal cases, as well as defendants who may be injured thereby." Daniel v. State, 56 Ga. 654, 655 (1876). While in that case the principle was applied to the possibility that the juror heard expressed the opinion of members of the public gathered at the courthouse, the principle would apply to any influences outside the evidence presented at the trial which might affect the impartiality of the jurors' decision-making process. Because influences on human minds are numberless, often subtle, frequently undiscernable, and effective to different degrees and in different ways on each mind, much is done to insure against the introduction of any extraneous fact or pressure which might affect the impartial, reasoned, and grounded decision of the jury. The rules of evidence are a broad example. The rule of sequestration is another. A third is the firm cautionary instruction given to jurors at the outset against talking with any witness, such as was given here. The principle is so fundamental that it has been jealously guarded, even to the extent of requiring new trials when the bailiff did not remain awake while the jurors were in his care overnight. See Smith v. State, 218 Ga. 216, 219-221 (2) (126 SE2d 789) (1962), discussing several of these cases. Principles applicable here are recited in the Smith case:"'a mere trifling and immaterial irregularity in the conduct of a juror will not require the grant of a new trial . . . an irregularity without opportunity for injury will not require the grant of a new trial' . . . the State . . . [has] the burden of showing that the defendant sustained no injury." Smith v. State, supra at 223.
Another authority cited in Smith is Monroe v. State, 5 Ga. 85 (1848), where Justice Lumpkin wrote: "there are certain legal safeguards which must be preserved immaculate; the purity of the stream of justice is involved in it. One of these safeguards is, that the jury shall be impartial and unbiased [sic]; their minds free from pre-judgment. It is desirable, if practicable, that every juror's minds should be as white as paper . . . whenever the juror evinces a predetermination to condemn, an adjudication before trial or verdict, without regard to the evidence, it is a mis-trial per se; . . ." Id. at 139-140. There the subject was a juror's expression of apparent prejudgment. The same principle would apply here, where the juror's mind was affected in the midst of trial, long before jury deliberations and verdict, by having finally found a listening law enforcement ear after having been frustrated in her attempts to alert the law about drug activities she had on her mind.
The accommodating listener was the crucial witness for the state in a case the juror was yet to judge, and that receptive person's credibility particularly with regard to precisely the words which were spoken between himself and defendant was a key issue. A confidential relationship had been established, and this juror's satisfactory experience *294 with the witness, which relieved her mind, constituted for her additional extra judicial evidence upon which she could judge the witness' testimony. That evidence was not even subject to cross-examination, much less disclosure to the rest of the jury. Since she was expressly prohibited from acquainting her fellow-jurors with it for fear of it affecting them, how then can it be said that it did not affect her, the actual instigator and participant? She had sought help and she had finally gotten it, and thus her confidence in the witness was buttressed and arguably strengthened. How can it be said that her attitude towards judging the witness' testimony remained unbiased, especially when in her presence the agent protected her by refusing to violate the confidentiality of the information she had related?
Thus the fact that they did not talk about this case cannot be the end of the inquiry. Influences arise from more than mere words. The context and circumstances here cannot be ignored. In addition to the state-prone influences brought about by the juror's call, influences negative to defendant were forced on him by the inquiry in the court's chambers. There, through counsel, he was faced with challenging and cross-examining the juror as to the phone conversation and her impartiality, an antagonistic posture counsel recognized as dangerous and one occasioned by the juror herself. In addition, she stood to gain in the outcome of the trial, for she could surmise that a guilty verdict would be pleasing to the very person to whom she looked expectantly for action regarding other drug activities she knew about.
"In Georgia, it has been held that where an irregularity in the conduct of the juror is shown, the presumption is that the defendant has been prejudiced and the burden is on the state to rebut that presumption. See Smith v. State, supra; Daniel v. State, 56 Ga. 653 (1876); Monroe v. State, 5 Ga. 85 (1848)." Martin v. State, 242 Ga. 699, 701 (251 SE2d 240) (1978). The circumstances here, including the state's refusal to divulge all of the conversation, understandable but nevertheless enhancing the relationship between the witness and the juror, require enforcement of the unassailable prohibition against communication between juror and witness. Adherence is fundamental to a fair trial.
See also Smith v. State, 173 Ga. App. 889 (328 SE2d 553) (1985) (dissent).
There are actually three interests which must be tended to in dealing with the problem which developed by virtue of the telephone conversation. One is the defendant's right to a fair trial by an impartial jury. The second is the integrity of the system of justice as administered in this state and the appearance as well as the actual propriety of the proceedings. What perception is being created when a trial is allowed to progress despite a juror's intentional conversation with a key witness? Third is the inviolability of court orders. May they be *295 ignored or disobeyed without sanction as here, creating a weakening of the court's authority through deliberate superimposition of the orderers own judgment? In order to give meaningful security to these three interests, strict application of the principle is deserved.
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FILED
NOT FOR PUBLICATION OCT 25 2013
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
SURESHBHAI RANCHHODJI AHIR, No. 11-73643
Petitioner, Agency No. A070-122-332
v.
MEMORANDUM*
ERIC H. HOLDER, Jr., Attorney General,
Respondent.
On Petition for Review of an Order of the
Board of Immigration Appeals
Submitted October 15, 2013**
Before: FISHER, GOULD, and BYBEE, Circuit Judges.
Sureshbhai Ranchhodji Ahir, a native and citizen of India, petitions for
review of the Board of Immigration Appeals’ order dismissing his appeal from an
immigration judge’s decision denying his motion to reopen deportation
proceedings conducted in absentia. We have jurisdiction under 8 U.S.C. § 1252.
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
We review for abuse of discretion the denial of a motion to reopen. Arrieta v. INS,
117 F.3d 429, 430 (9th Cir. 1997) (per curiam). We deny the petition for review.
The agency did not abuse its discretion in denying Ahir’s motion to reopen
on the ground that Ahir failed to rebut the strong presumption of effective service
arising from the service of his hearing notice by certified mail. See id. at 431;
Matter of Grijalva, 21 I. & N. Dec. 27, 37 (BIA 1996).
Ahir’s contention that the agency erred by ignoring evidence is not
supported by the record. Lin v. Holder, 588 F.3d 981, 987-88 (9th Cir. 2009)
(although the BIA must consider a petitioner’s evidence, “it need not expressly
refute on the record every single piece of evidence”).
It follows that the agency did not violate Ahir’s due process rights by
denying the motion. See Lata v. INS, 204 F.3d 1241, 1246 (9th Cir. 2000)
(requiring error and substantial prejudice to prevail on a due process claim).
Ahir’s remaining contentions are unavailing.
PETITION FOR REVIEW DENIED.
2 11-73643
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19 A.3d 572 (2011)
GLATFELTER PULPWOOD COMPANY, Petitioner
v.
COMMONWEALTH of Pennsylvania, Respondent.
No. 362 F.R. 2007.
Commonwealth Court of Pennsylvania.
Argued April 6, 2011.
Decided May 4, 2011.
*574 George T. Bell, Harrisburg, for petitioner.
Jonathan C. Edmunds, Harrisburg, for respondent.
BEFORE: LEADBETTER, President Judge, and McGINLEY, Judge, and PELLEGRINI, Judge, and SIMPSON, Judge, and LEAVITT, Judge, and BROBSON, Judge, and McCULLOUGH, Judge.
OPINION BY Judge PELLEGRINI.
Glatfelter Pulpwood Company (Taxpayer) petitions for review from an order of the Board of Finance and Revenue (Board) denying its request for a tax refund because its timberland sales gains meets the definition of "business income" under Section 401(3)2.(a)(1)(A) of the Tax Reform Code of 1971.[1] For the reasons that follow, we affirm the Board's decision.
I.
According to the parties' Stipulation of Facts, Taxpayer is a wholly-owned subsidiary of P.H. Glatfelter Corporation, the parent company (Parent), which is a corporation that is organized under the laws of Maryland and maintains its headquarters in York, Pennsylvania. The Parent is engaged in the business of manufacturing specialty papers and engineered products *575 and has timberlands located in Delaware, Maryland, Pennsylvania and Virginia. Taxpayer's sole business activity is the procurement of pulpwood either from harvesting company-owned timberland or by purchasing timberland from third parties for the specialty paper manufacturing operations of the Parent. Taxpayer operates the Parent's paper mill in Spring Grove, Pennsylvania.
Prior to 2003, Taxpayer obtained approximately 25% of the pulpwood needed for its Parent's paper manufacturing operations from company-owned timberland and procured approximately 75% of the needed pulpwood from purchases on the open market. In 2003, following an industry trend, Taxpayer made a corporate decision to divest certain of its timberland holdings with the effect of reducing the percentage of pulpwood procured from company-owned timberland from approximately 25% to approximately 5%. This was known as the "Timberland Divestiture Plan." As a result, Taxpayer sold 5,000 acres of timberland in Delaware and 25,821 acres of timberland in Maryland. It sold most of its timberland in Maryland to The Conservation Fund, a non-profit Maryland corporation, and received in consideration a 10-year note in the amount of $37.9 million. It also entered into a supply agreement to purchase at market prices an annual amount of pulpwood averaging 34,425 tons per annum over the eight-year term of the agreement on the timberlands sold to The Conservation Fund. As of December 31, 2004, Taxpayer owned 14,364 acres of timberland in Delaware; 25,587 acres of timberland in Pennsylvania; 40,676 acres of timberland in Virginia; and 49 acres of timberland in Maryland.
During 2004, as part of the Timberland Divestiture Plan, Taxpayer sold 4,882 acres of timberland in Delaware for $56,586,000, realizing a net gain of $55,355,452 ("the 2004 Delaware Sale"). Taxpayer reported the 2004 Delaware Sale on its federal tax return as a sale or exchange of property used in a trade or business. The income generated by the sales of pulpwood from the business prior to the 2004 sale was reported to Pennsylvania as apportionable business income. Taxpayer distributed all of the net proceeds from the 2004 Delaware Sale to its Parent, which, in turn, used the proceeds to pay debt and pay dividends to its shareholders.
Taxpayer filed its 2004 corporate tax report omitting any inclusion of nonbusiness income and reporting a tax liability of $2,189,876. Taxpayer paid this liability and filed an amended corporate tax report claiming that the net gain from the 2004 company-owned timberland in Delaware was nonbusiness income to be allocated to Delaware. The amended corporate tax report reported a zero corporate net income tax liability. On settlement of Taxpayer's 2004 tax year, the Department of Revenue (Department) increased the apportionable business income from a ($3,044,914) net loss to $52,327,343 through denial of the nonbusiness income treatment of the net gain related to the 2004 timberland sale. As a result, the Department asserted additional corporate net income tax liability owed by Taxpayer in the amount of $2,205,211.
Taxpayer filed an appeal with the Board of Appeals seeking a refund of the 2004 corporate net income tax in the amount of $2,205,211 based on a claim of nonbusiness income treatment for the net gain from the 2004 Delaware Sale. The Board of Appeals refused Taxpayer's refund claim, and Taxpayer appealed to the Board again requesting nonbusiness income treatment for the net gain from the 2004 Delaware Sale. The Board denied Taxpayer's request because it found that *576 the timberland sales gains met the definition of "business income" under Section 401(3)2.(a)(1)(A) of the Tax Reform Code of 1971 and met the transactional test for business income:
because buying and selling timberland occurred in the regular course of [Taxpayer's] business. Welded Tube Co.,[[2]] supra. [Taxpayer] decided that it under utilized its timberlands and engaged in a series of timberland sales in 2003 and in 2004. The timberland sales gains meet the functional test for business income because the acquisition and management of timberlands constituted an integral part of [Taxpayer's] regular trade or business. 72 P.S. § 7401(3)2.(a)(1)(A). All business income is apportioned under the Tax Reform Code. 72 P.S. § 7401(3)2.(a)(9)(A). The Department correctly settled and apportioned [Taxpayer's] business income.
(Board's May 22, 2007 decision at 7.) This appeal by Taxpayer followed.[3]
II.
For purposes of corporate net income tax, Pennsylvania classifies income into two groups: business income and nonbusiness income. "Business income" is defined as:
Income arising from transactions and activity in the regular course of the taxpayer's trade or business and includes income from tangible and intangible property if either the acquisition, the management or the disposition of the property constitutes an integral part of the taxpayer's regular trade or business operations. The term includes all income which is apportionable under the Constitution of the United States.[[4]] (Emphasis added.)
Income that is "apportionable" means that it is divided among states with some nexus to the business based on a formula. In Pennsylvania, the apportionment is based on payroll, property and sales. 72 P.S. § 7401(3)2.(a)(9)(A).
In Welded Tube Company, this Court set forth two alternative independent tests by which to evaluate whether income was properly classified as business income or nonbusiness income.[5] We stated that the "transactional" test was utilized for the first clause of the definition: gains were classified as business income when they were derived from a transaction in which *577 the taxpayer regularly engaged, i.e., the test measured the frequency and regularity of similar transactions and past practices of the business. Also, the taxpayer's subsequent use of the income was relevant in determining whether the income was business income. Looking at the second clause of the definition of "business income," the "functional" test was utilized: "in the view of other jurisdictions, by which earnings may be characterized as business income: income from `tangible and intangible property if the acquisition, management and disposition of the property constitute integral parts of the taxpayer's regular trade or business.' Under this test, the gain arising from the sale of an asset will be classified as business income if the asset produced business income while it was owned by the taxpayer." Welded Tube Company, 515 A.2d at 994. (Emphasis in original.) The extraordinary nature or infrequency of the transaction was irrelevant.
A.
Taxpayer contends that the sale of the timberland does not meet the transactional test because it does not regularly deal in the business of selling or speculating in real estate. Its regular and routine business is the procurement and sale of harvested pulpwood to its Parent. It points out that from 1970 through 2002, it made only incidental sales of timberlands, primarily in isolated transactions to "round off" tracts or to accommodate a neighboring landowner. Those sales amounted to a miniscule 0.21% of Taxpayer's timberland holdings per year. Therefore, while the routine sale of timber would be deemed business income, the 2004 Delaware Sale was not a transaction or activity in which Taxpayer "regularly" engaged and it should not be deemed apportionable business income under the transactional test. We agree and the Commonwealth does not contend otherwise that the 2004 Delaware Sale does not fall under the transactional test because it was a one-time event and cannot possibly meet the definition of regular and routine business.
B.
Taxpayer also argues that it does not fall under the functional test because to do so, the property itself would have to be an integral part of its regular trade or business. In this case, while the timber is integral to its regular business operations, the real estate itself is not. It argues, by example, that if it were to sell the Parent's corporate headquarters, that could conceivably fall within the functional test if the building was deemed an integral part of Taxpayer's trade or business. However, because the 2004 Delaware Sale is not an integral part of Taxpayer's regular trade or business, the gain on the transaction is not business income under the functional test either.
In order to fall under the functional test, "business income" is included if it comes from the management, acquisition or disposition of property which constitutes an integral part of Taxpayer's regular trade or business. In addition, "under this test, the gain arising from the sale of an asset will be classified as business income if the asset produced business income while it was owned by the taxpayer. The extraordinary nature or infrequency of the transaction is irrelevant." Welded Tube, 515 A.2d at 994. The stipulated facts indicate that Taxpayer had employees and/or third party contractors plant, thin and harvest timber and monitor soil conditions to maximize sustainable pulpwood yields as part of its ongoing timberland management practices. In 2003, as part of the strategic decision by its Parent to reduce the purchase of timber from pulp *578 from 25% to 5% of its needs, Taxpayer began to dispose of timberland, including the sale of approximately 5,000 acres of timberland in Delaware for $56,586,000. As the stipulated facts show, Taxpayer's sales were part of "the management or the disposition of the property constitut[ing] an integral part of the taxpayer's regular trade or business operations management," 72 P.S. § 7401(3)2.(a)(1)(A), making the income derived from the sale of business income.
C.
Now to the Taxpayer's major contention regarding whether the disposition of assets constitutes business income. Relying on Laurel Pipe Line Company v. Board of Finance and Revenue, 537 Pa. 205, 642 A.2d 472 (1994), Taxpayer argues that the sale of the Delaware timberland was not a routine occurrence in Taxpayer's regular business operation because it constituted a partial liquidation of a unique aspect of its business assets, and the net gain should be deemed nonbusiness income allocable to Delaware where the real property was situated.
In Laurel Pipe Line, Laurel was an Ohio corporation in the business of transporting petroleum products from refinery and pipeline connections from Philadelphia to Pittsburgh. It also operated a pipeline from Aliquippa, Pennsylvania to Cleveland, Ohio from 1983 until 1986. It discontinued the operation of that Pennsylvania-Ohio pipeline in 1983 and sold the pipeline for a gain of almost $4 million. When it filed its 1986 Pennsylvania corporate net income tax return, Laurel treated the gain from the sale of the pipeline as nonbusiness income and allocated the gain between Pennsylvania and Ohio. Because the Pennsylvania Department of Revenue reclassified the gain as business income subject to apportionment, Laurel filed a petition for resettlement with the Board of Appeals, which was denied. On appeal, the Supreme Court adopted the Welded Tube functional test and stated that the then statutory definition of business income required that "the acquisition, management, and disposition of the property constitute integral parts of the taxpayer's regular trade or business operations." 72 P.S. § 7401(3)2.(a)(1)(A). (Emphasis in original.) The Court determined that the entire pipeline was not being disposed of, but the sale of the pipeline was a liquidation of a separate and distinct aspect of its business stating:
[T]he pipeline was not disposed of as an integral part of Laurel's regular trade or business. Rather, the effect of the sale was that the company liquidated a portion of its assets. This is evidenced by the fact that the proceeds of the sale were not reinvested back into the operations of the business, but were distributed entirely to the stockholders of the corporation.
537 Pa. at 211, 642 A.2d at 475. In doing so, our Supreme Court made applicable that portion of the transactional test that "the gain accruing from the sale of assets pursuant to business liquidation has been held under this [transactional] test to be nonbusiness income arising from a transaction of an extraordinary nature outside the regular course of the taxpayer's trade or business" to the functional test. Welded Tube, 515 A.2d at 993. The Court held that the gain was nonbusiness income because the pipeline constituted a partial liquidation of the company's business because it had changed the structure of the taxpayer's business and that was not a transaction in which the company regularly engaged.[6]
*579 However, the facts in Laurel Pipe Line are different from the facts of this case. First, the proceeds of the sale in Laurel were distributed directly back to its Parent, what a subsidiary does who no longer needs the money for ongoing business activities. Second, Laurel disposed of pipeline that ended its business in a certain area indicating a partial liquidation of its business. Here, however, the 2004 Delaware Sale was not a liquidation of its business because Taxpayer still owns 14,364 acres of timberland in Delaware, and the sale took place because its Parent decreased the percentage of the pulp it procured from Taxpayer. Its ongoing business still continued. Third, unlike in Laurel, the sale did not change the scope of Taxpayer's business because where the timber that produced pulp came from, i.e., which state, was irrelevant because Taxpayer operated as an integrated business enterprise. Finally, Taxpayer, before and after the disposition of this property, was going to continue to sell pulp to its Parent as part of its ongoing business activities. All of that indicates that Taxpayer, while disposing of its holdings, was not engaged in liquidating its business or parts of its business.[7]
*580 III.
Taxpayer also argues that because its Parent's real estate is located in Delaware and is unrelated to Taxpayer's regular business activities of procuring pulpwood for the Parent, the gain on its sale should be excluded from the taxable base for Pennsylvania corporate net income tax regardless of whether the gain is deemed business or nonbusiness income. It argues that the disposing of unneeded real estate assets in Delaware is not a necessary part of its corporate activity in Pennsylvania of procuring pulpwood of Taxpayer's regular business in Pennsylvania.
In Commonwealth v. ACF Industries, Incorporated, 441 Pa. 129, 271 A.2d 273 (1970), our Supreme Court set forth the following principles to follow to decide if apportionment was allowed:
First, if a multistate business enterprise is conducted in a way that one, some or all of the business operations outside Pennsylvania are independent of and do not contribute to the business operations within this State, the factors attributable to the outside activity may be excluded. Second, in applying the foregoing principle to a particular case, we must focus upon the relationship between the Pennsylvania activity and the outside one, not the common relationships between these and the central corporate structure. Only if the impact of the latter on the operating units or activities is so pervasive as to negate any claim that they function independently from each other do we deny exclusion in this context. Third, without attempting to preclude exclusion in any given case, we reiterate our statement above that the manufacturing, wholesaling and retailing (or manufacturing and selling) activities of a single enterprise are not fit subjects for division and partial exclusion. On the other hand, a truly divisionalized business, conducting disparate activities with each division internally integrated with respect to manufacturing and selling, may well be in a position to make a valid claim for exclusion.
441 Pa. at 142, 143, 271 A.2d at 279, 280.
In effect, Taxpayer's argument that its Parent's 2004 Delaware Sale is unrelated to Pennsylvania is a variation on its theme that it does not meet the functional test. Based on the Stipulations of Facts, we found that the company operated as a unitary whole; the activities in procuring pulpwood were integrated, involving pulp from timberland from a number of states to provide pulp for a paper mill in Pennsylvania; and the Delaware sale was not a liquidation but the disposition of property that was used in producing business income. For those reasons, the income from the 2004 Delaware Sale is subject to tax in Pennsylvania as business income.
IV.
Finally, Taxpayer argues that it is being unfairly taxed on the sale of a parcel of timberland situated in Delaware in violation of the Due Process and Commerce Clauses of the United States Constitution. Taxpayer argues that the issue under both of those clauses is that the method of apportionment employed by Pennsylvania is unfair.
Regarding the Commerce Clause, Taxpayer contends that the tax does not comply with the United States Supreme Court test to determine whether a state tax violated the Commerce Clause in Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 97 S.Ct. 1076, 51 L.Ed.2d 326 (1977). Under that test, a state tax is held to be constitutionally valid if the tax (1) is applied to an activity having a substantial nexus with the taxing state, (2) is fairly apportioned, (3) does not discriminate *581 against interstate commerce, and (4) is fairly related to the services provided by the state. Taxpayer argues that the imposition of the tax does not meet the second and fourth prongs of the test because it is not fairly apportioned and is not fairly related to the services provided by the state. As for the Due Process Clause claim, Taxpayer argues "the income attributed to the State for tax purposes must be rationally related to values connected with the taxing state." Quill Corp. v. North Dakota, 504 U.S. 298, 306, 112 S.Ct. 1904, 119 L.Ed.2d 91 (1992) (citation and internal quotation marks omitted).
As to whether the tax is apportioned fairly, Taxpayer contends that because Delaware has already taxed Taxpayer 100% of the income on the gain attributable to the sale of real property and Pennsylvania another 42%, that means that those states apply their taxes against 142% of the income in those two states alone, not even considering the possibility of taxation in other states such as Maryland and Virginia. However, whether there has been a fair apportionment is determined by whether the apportionment formula (1) "if applied in every jurisdiction, ... would result in no more than all the unitary business income test being taxed" if every state had assessed an identical tax statute and (2) "the factor or factors [here property, payroll and sales] used in the apportionment formal ... actually reflect how the income is being generated." Container Corporation of America v. Franchise Tax Board, 463 U.S. 159, 169, 103 S.Ct. 2933, 77 L.Ed.2d 545 (1983). In this case, if every jurisdiction applied the factors used here, which are not challenged, then no more than 100% of the unitary income would be taxed.
Taxpayer argues that the tax is not fairly related to the services provided by the state because except for the gain from the 2004 Delaware Sale, Taxpayer reported to Pennsylvania a net loss of $3 million. The Department attempts to attribute to the Commonwealth a substantial portion 42% of the $52.3 million net gain in Delaware by including the amount in apportionable income. Taxpayer contends that the methodology being employed taxes an unreasonable amount of Taxpayer's income not attributable to its Pennsylvania activities and creates an unreasonable and unfair tax burden under the Due Process Clause. However, assuming that test even applies, given that the Commonwealth is home to Taxpayer and its Parent, Taxpayer has timberland in Pennsylvania and uses the Pennsylvania infrastructure to deliver the pulpwood to Pennsylvania; it does not just have some tangential relationship to the state that would establish that the tax is not fairly related to the services it receives from Pennsylvania.
In conclusion, under the Due Process Clause, there must be some definite link, some minimal connection, between a state and the person, property or transaction it seeks to tax as well as a rational relationship between the tax and the values connected with the taxing state. Quill Corporation. The Commerce Clause limitation forbids states to levy taxes that discriminate against interstate commerce or that burden it by subjecting activities to multiple or unfairly apportioned taxation. Id. The misunderstanding by Taxpayer is that there is no violation by Pennsylvania of either the Due Process or Commerce Clauses because, while Delaware may tax whatever portion it sees fit on the gain from the 2004 Delaware Sale, so may the Commonwealth without regard for whatever amount Delaware taxed Taxpayer for that sale. The Commonwealth need only consider what activities Taxpayer conducts in Pennsylvania that have some connection *582 to its activities in Delaware. Because we have already determined that the 2004 Delaware Sale had a relationship to the business activities in Pennsylvania and was properly apportioned for taxes in Pennsylvania, there was no violation of the Due Process or Commerce Clauses.
Accordingly, for the foregoing reasons, the order of the Board is affirmed.
Judges McGINLEY, SIMPSON and LEAVITT dissent.
ORDER
AND NOW, this 4th day of May, 2011, the order of the Board of Finance and Revenue, dated May 22, 2007, is affirmed. The parties have 30 days from the entry of this order in which to file exceptions.
NOTES
[1] Act of March 4, 1971, P.L. 6, as amended, 72 P.S. § 7401(3)2.(a)(1)(A).
[2] Welded Tube Company of America v. Commonwealth, 101 Pa.Cmwlth. 32, 515 A.2d 988 (1986).
[3] In appeals from decisions of the Board of Finance and Revenue, our review is de novo because we function as a trial court even though such cases are heard in our appellate jurisdiction. Canteen Corporation v. Commonwealth, 818 A.2d 594 (Pa.Cmwlth.2003).
[4] "Nonbusiness income" is defined as "all income other than business income. The term does not include income which is apportionable under the Constitution of the United States." 72 P.S. § 7401(3)2.(a)(1)(D).
[5] In Welded Tube Company, "business income" was defined as "income arising from transactions and activity in the regular course of the taxpayer's trade or business and includes income from tangible and intangible property if the acquisition, management, and disposition of the property constitute integral parts of the taxpayer's regular trade or business operations." 72 P.S. § 7401(3)2.(a)(9). The definition was amended by Section 25 of the Act of June 22, 2001, P.L. 353, to include the word "either" after "tangible and intangible property if" and the word "or" instead of the word "and" between the words "management" and "disposition of the property." The second sentence was also added. Subsequently, in Section 5 of Act 23, Act of June 22, 2001, P.L. 353, No. 23, the General Assembly stated that it "finds and declares that the intent of the amendment of section 401(3)2(a)(1)(A) and (D) of the act is to clarify existing law."
[6] The Commonwealth, however, argues that since Laurel Pipe Line, 72 P.S. § 7401(3)2.(a)(1)(A), was amended by Act 23 of 2001 by the addition of the word "either" after "tangible and intangible property if" and, more pertinently, the word "or" instead of the word "and" between the words "management" and "disposition of the property," those additions change the outcome in Laurel Pipe Line to the effect that the sale of an asset producing business income during the ownership could produce nonbusiness income by its sale. Taxpayer argues that change does not change the status of the law, including Laurel Pipe Line, because in Section 5 of Act 23, Act of June 22, 2001, P.L. 353, No. 23, the General Assembly stated that it "finds and declares that the intent of the amendment of section 401(3)2(a)(1)(A) and (D) of the act is to clarify existing law." Because of the way we have resolved this matter, we need not address this issue but we note that this Court in Canteen Corporation held that the statutory change in Act 23 regarding the definitions of "business income" and "nonbusiness income" was an amendment, Canteen Corporation, 818 A.2d at 598 ns.9-10, and any attempt by the General Assembly to interpret the Tax Reform Code is beyond its powers, Mack Trucks, Inc. v. Commonwealth, 157 Pa.Cmwlth. 14, 629 A.2d 179 (1993).
[7] Taxpayer also relies on Canteen Corporation for the same proposition. In that case, the issue was whether a corporate taxpayer's gain from the fictional liquidation of assets deemed to occur under a federal tax election was taxable by the Commonwealth. Canteen was incorporated in Delaware, headquartered in North Carolina and conducted its food service business operations in many states, including Pennsylvania. It was a wholly-owned subsidiary of I.M. Vending, which was a wholly-owned subsidiary of Canteen Holdings, Inc. Holdings was a subsidiary of Flagstar Companies, Inc. In 1994, as part of Flagstar's divestiture plan, Holdings sold Vending to Compass Holdings, Inc., an unrelated corporation, and Canteen, as a subsidiary of Vending, was conveyed to Compass as an asset. It did not participate as a party to the sale or receive cash or other proceeds as a result of the sale. After the sale, Holdings and Compass chose to apply a certain section of the Internal Revenue Code so that the sale of Vending stock was treated as if Vending sold all of its assets in liquidation and distributed the proceeds to its parent, Holdings. Canteen, the subsidiary of Vending, was also deemed to have sold all of its assets in liquidation and to have distributed the proceeds to Vending. Under the Internal Revenue Code, Canteen realized a fictitious gain for both state and federal income tax purposes. This Court held that the gain had to be treated as nonbusiness income because the asset liquidation did not generate business income under the transactional test. It also was not a type of transaction in which Canteen regularly engaged. Further, the proceeds had been distributed to the stockholder. Again, Canteen Corporation does not support its argument because Taxpayer regularly engages in the timberland business. Although it distributed proceeds from the 2004 Delaware Sale to its Parent, it did not make the sale for the purposes of liquidation. Moreover, we have determined that the transactional test that was used in Canteen Corporation does not apply in this case.
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99 P.3d 1239 (2004)
195 Or. App. 546
STATE
v.
FOX.
Court of Appeals of Oregon.
September 29, 2004.
Affirmed without opinion.
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397 F.2d 523
Sherman H. SKOLNICK, Plaintiff-Appellant,v.Commissioner James Benton PARSONS, the President's Commission of Law Enforcement and Administration of Justice, Defendants-Appellees.
No. 16615.
United States Court of Appeals Seventh Circuit.
July 9, 1968.
Motion to Vacate Judgment Denied on August 5, 1968.
Sherman H. Skolnick, Chicago, Ill., for plaintiff-appellant.
Thomas A. Foran, U. S. Atty., Jack B. Schmetterer, Asst. U. S. Atty., Chicago, Ill., for defendants-appellees, John Peter Lulinski, Asst. U. S. Atty., of counsel.
Before SWYGERT, FAIRCHILD and CUMMINGS, Circuit Judges
CUMMINGS, Circuit Judge.
1
Acting pro se under Section 1361 of the Judicial Code (28 U.S.C. § 1361),1 plaintiff has sued the President's Commission on Law Enforcement and Administration of Justice and one of its members. The purpose of the suit was to compel the defendants to release a 63-page report submitted to defendants by G. Robert Blakey of the faculty of Notre Dame Law School. The Executive Committee of the District Court dismissed the complaint sua sponte on the following two grounds:
2
"1. The said complaint states no cause of action justiciable in this Court.
3
"2. The legal existence of both defendants named in said complaint terminated by Presidential Order prior to the filing of the complaint, as evidenced by attached Exhibit A."
4
According to the complaint, the Commission was established on July 23, 1965, through Executive Order 11236. Its principal report, entitled "The Challenge of Crime in a Free Society," was issued in February 1967. The Government advises us that the Commission's last task force report was submitted to the President in June 1967. Under the Executive Order, the Commission was required to terminate 90 days after that event. Exhibit A attached to the dismissal order was a General Services Administration Notification of Personnel Action showing that the defendant Commissioner's services terminated on June 21, 1967, because of the Commission's completion of assignment.
5
In view of a 1967 Public Information amendment to the Administrative Procedure Act, not cited in the complaint but discussed in the briefs here, the first ground of the District Court's judgment is not sustainable. Thus Section 552(a) (3) of Title 5 of the United States Code provides in pertinent part:
6
"* * * each agency [defined in § 551(1) as `each authority of the government of the United States,' with certain exceptions], on request for identifiable records made in accordance with published rules stating the time, place, fees to the extent authorized by statute, and procedure to be followed, shall make the records promptly available to any person. On complaint, the district court of the United States in the district in which the complainant resides, or has his principal place of business, or in which the agency records are situated, has jurisdiction to enjoin the agency from withholding agency records and to order the production of any agency records improperly withheld from the complainant. In such a case the court shall determine the matter de novo and the burden is on the agency to sustain its action. In the event of noncompliance with the order of the court, the district court may punish for contempt the responsible employee, and in the case of a uniformed service, the responsible member. Except as to causes the court considers of greater importance, proceedings before the district court, as authorized by this paragraph, take precedence on the docket over all other causes and shall be assigned for hearing and trial at the earliest practicable date and expedited in every way." (Emphasis supplied.)
7
By virtue of this statute, the complaint, by interpreting the allegations of suppression of the Blakey report as equivalent to a "request," does state a cause of action justiciable in the District Court.2 Under this statute, the plaintiff has standing because the records are to be made available "to any person." See Davis, The Information Act: A Preliminary Analysis, 34 U.Chi.L.Rev. 761, 765 (1967).
8
The second ground for dismissing the complaint was the termination of the legal existence of the defendant Commission and of the defendant Commissioner's term. In an effort to obtain jurisdiction over the defendants, plaintiff served summonses and copies of the complaint upon the defendant Commissioner, the United States Attorney General, and the United States Attorney for the Northern District of Illinois. Nevertheless, assuming that the Commission was a suable entity and also that one of its members could be sued individually, any mandamus type of action against them abated when the Commission terminated on June 21, 1967. Snyder v. Buck, 340 U.S. 15, 18, 71 S.Ct. 93, 95 L.Ed. 15; Acheson v. Fujiko Furusho, 212 F.2d 284, 295 (9th Cir. 1954); Chew Yin v. Acheson, 216 F.2d 60, 61 (7th Cir. 1954); Bowles v. Wilke, 175 F.2d 35, 37-38 (7th Cir. 1949), certiorari denied, 338 U.S. 861, 70 S.Ct. 104, 94 L. Ed. 528. Since this Commission became functus officio, there was no "transfer of interest" within Rule 25(c) of the Federal Rules of Civil Procedure permitting continuance of the action against the original party or substitution of the person to whom the interest is transferred. See 4 Moore's Federal Practice (2d ed.) ¶ 25.08. Similarly, Rule 25(d) does not permit substitution, for no successors to the Commission were appointed. See ibid., ¶ 25.09. Even if the Commission were still in existence, it is doubtful that it could be sued, for "Congress has not constituted the Commission a body corporate or authorized it to be sued eo nomine." Blackmar v. Guerre, 342 U.S. 512, 514, 72 S.Ct. 410, 411, 96 L.Ed. 534. As stated there, when Congress authorizes one of its agencies to be sued eo nomine, it does so explicitly, or impliedly where the agency is an offspring of a suable entity. Ibid. at p. 515, 72 S.Ct. 410.
9
Consideration of this complaint was given by the partly rotating Executive Committee, a three-judge arm of the United States District Court for the Northern District of Illinois, in accordance with its practice of screening pro se complaints in an effort to weed out frivolous litigation. Those that pass the screening process are then assigned by the Executive Committee to a judge with related complaints or otherwise returned to the Clerk for the customary assignment under Rule 10 of the General Rules of that Court. This practice was formalized by the adoption of an amendment to Rule 10(B) (2) (a) of the General Rules in November 1967.3 The amendment was intended to relieve the former situation where a myriad of pro se complaints were automatically assigned in a haphazard way to the eleven members of that Court without their even knowing of the pendency of related matters before their brethren. When this complaint was reviewed, the Executive Committee consisted of Chief Judge Campbell and Judges Parsons and Will. Since Judge Parsons was named a defendant in his capacity as a former member of the President's Commission on Law Enforcement and Administration of Justice, he did not participate in the dismissal order. The fact that the dismissal order was signed by two judges exercising their judicial function does not denigrate it as an order of the Court entered under its rule-making power. See 28 U.S.C. § 2071; cf. TCF Film Corp. v. Gourley, 240 F.2d 711, 714 (3d Cir. 1957); Hosie v. Chicago & North Western Railway Company, 282 F.2d 639, 643 (7th Cir. 1960), certiorari denied, 365 U.S. 814, 81 S.Ct. 695, 5 L.Ed.2d 693; Schiff v. Hannah, 282 F.Supp. 381 (W.D.Mich.1966); United States v. 4,400 Copies of Magazines, etc., 276 F.Supp. 902 (D.Md.1967). The Chief Judge of the District Court has been directed by Congress to be "responsible for the observance of [the] rules and orders [of the court], and [to] divide the business and assign the cases so far as such rules and orders do not otherwise prescribe" (28 U.S.C. § 137). This statutory command amply authorizes the amendment to General Rule 10(B) (2) (a).
10
Harmon v. Superior Court, 307 F.2d 796 (9th Cir. 1962), on which plaintiff relies, recognizes the propriety of summarily dismissing a complaint for a jurisdictional defect. Here the District Court could judicially notice that this Presidential Commission had terminated before this complaint was filed, thus depriving it of jurisdiction to proceed further. See Snyder v. Buck, 340 U.S. 15, 22, 71 S.Ct. 93, 95 L.Ed. 15. If a district court entered an order against a non-existent commission, a court of appeals could reverse on the ground that the district court was without jurisdiction. Idem.; see also 28 U.S.C. § 2105. Harmon was cited with approval in Urbano v. Calissi, 353 F.2d 196 (3d Cir. 1965), on which plaintiff also relies. We agree with Harmon and Urbano that the District Court should exercise sua sponte dismissal power only in the clearest cases. Even under the amendment to its General Rule 10(B) (2) (a), the contentions of both plaintiffs and defendants should ordinarily be presented to a single District Judge.
11
We have considered the other points raised by plaintiff but do not deem them persuasive.
12
The cause of action against these defendants having abated, the judgment is affirmed.
Notes:
1
This 1962 provision granted original jurisdiction to the district courts "in the nature of mandamus to compel an officer or employee of the United States or any agency thereof to perform a duty owed to the plaintiff."
2
At the oral argument, the Government relied on two exceptions to the statute. The first excepts "inter-agency or intra-agency memorandums or letters which would not be available by law to a party other than an agency in litigation with the agency" (5 U.S.C. § 552(b) (5)). The second excepts "investigatory files compiled for law enforcement purposes except to the extent available by law to a party other than an agency" (5 U.S.C. § 552(b) (7)). The District Court was given no opportunity to construe these exceptions and therefore we do not pass on their applicability
3
The amendment provides in pertinent part:
"* * * that all cases filed by plaintiffs pro se (except petitions for a writ of habeas corpus and other cases filed by persons in custody) shall be assigned to the Executive Committee for consideration prior to the assignment thereof to the calendar of an individual judge."
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609 F.2d 1008
Bill Voorhees Co.v.R & S Camper Sales of Birmingham, Inc.
No. 77-2340
United States Court of Appeals, Fifth Circuit
12/19/79
N.D.Ala., 605 F.2d 888
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76 Wn.2d 234 (1969)
456 P.2d 337
THE STATE OF WASHINGTON, Respondent,
v.
ELBERT NEAL BARNES, JR., Appellant.[*]
No. 40145.
The Supreme Court of Washington, Department One.
June 12, 1969.
Barokas, Beitz, Berner & Schaefer and Larry L. Barokas, for appellant (appointed counsel for appeal).
Charles O. Carroll and Edmund P. Allen, for respondent.
McGOVERN, J.
Defendant appeals from a judgment of the court finding him guilty of violating the Uniform Narcotic Drug Act (RCW 69.33) and from the sentence which ordered him committed to the State Department of Institutions for a maximum term of not more than 20 years.
*235 June 28, 1967, John R. Parish, an agent of the Federal Bureau of Narcotics, executed an affidavit for purposes of obtaining a warrant to search certain premises in Seattle, described as being the residence of defendant. That affidavit was as follows:
JOHN R. PARISH, being frist [sic] duly sworn on oath, deposes and says:
That he is a Federal Narcotics Agent and is currently investigating narcotics traffic in the King County area; that in the course of his investigations he has had 2437 - S. Irving under surveillance and has seen several persons known to your affiant to be involved in the use and sale of narcotics in the Seattle area entering and leaving apartment #1 at this address; these persons mentioned include Dave Slack, Donna Webb, and Bob Thompson; that this surveillance was conducted last at 2:00 a.m. this morning; that last week your affiant saw a car with several people (three men and a women) [sic] park in front of the house; one man went into apartment one while others waited outside; this same person came out about five minutes later with what appeared to be a green balloon in his hand (not inflated); that your affiant has, in his experience in the field of narcotics, learned that this is a common way to carry and sell heroin; this observation was made through binoculars;
That your affiant has received information from an informant who advised your affiant htat [sic] he had been buying heroin from Barnes for months and that he was currently living at the above address; this same informant advised that he has never known Barnes to be without heroin;
That your affiant has known of Barnes for about 6 months; at that time he was living at 535 - 19th Ave., Seattle, Wash.; at that time your affiant received information from informants that he was dealing with heroin from that apartment;
Today your affiant received information from a very reliable informant who stated that he was present last Sunday when Barnes sold 40 caps of heroin to a now Crawford Clark who is also a known narcotics addict and seller; this sale did not, however, take place in Barnes' apartment;
That Barnes is known to your affiant to have been convicted in the past for a narcotics offense in California;
*236 That based upon the above information received from various sources and based upon your affiant's observation of Barnes' apartment during the past week it is your affiant's belief that narcotics are being secreted, dispensed and sold at the above address.
The warrant issued, and at about 1:30 a.m. the next morning several officers of the law used it as authority to search apartment No. 1 at the South Irving address. Entry into the apartment unit was by forcible means when no one answered the officer's knock on the door. A search was made and contraband consisting of several prophylactics containing heroin with opium derivatives was found. The defendant was then arrested in apartment No. 5 on a different floor of the building but narcotics were not found in that unit or on his person.
Defendant's first assignment of error attacks the legality of the search warrant. He argues that the issuing magistrate did not have sufficient probable cause to legally justify the issuance of the warrant since the affidavit of John R. Parish was constitutionally inadequate. As authority for his proposition he cites Aguilar v. Texas, 378 U.S. 108, 12 L.Ed.2d 723, 84 S.Ct. 1509 (1964).
[1] In Aguilar, a search warrant had issued upon the affidavit of law officers who swore only that they had "received reliable information from a credible person and [did] believe" that narcotics were being illegally kept on the premises. Our highest court held that the affidavit was inadequate for two reasons: (1) No "underlying circumstances" were set forth in the affidavit that would allow the magistrate to make an independent judgment of the validity of the informant's conclusion that narcotics were on the premises; and (2) the affiant did not factually attempt to support the claim that the informant was "credible" or his information "reliable." The evidence obtained by way of the Aguilar search warrant was therefore held inadmissible as taken in violation of the fourth amendment to our federal constitution.
We are satisfied that the John R. Parish affidavit satisfies the requirements of Aguilar. The following facts were reported *237 to the magistrate by his affidavit: A federal narcotics agent was the affiant and he had personally kept the premises under surveillance; the suspect had previously been convicted of a narcotics offense; the affiant observed other persons known to him to be involved in the trafficking of narcotics entering and leaving the premises; he observed a person leave the premises with a container commonly used in the transportation of heroin. Along with those underlying facts, the magistrate was further advised that a very reliable informant personally observed the suspect illegally selling some heroin only 3 days earlier; another informant said he had been buying heroin from the suspect for months, and that the suspect was living at the South Irving address.
The reported observations by the federal narcotics agent, when combined with the direct factual statements attributed to the informants, constitute sufficient grounds to support a magistrate's determination that he had sufficient probable cause to believe that a crime was being committed and to issue the warrant. The basis of his probability was substantially more than a mere "casual rumor circulating in the underworld or an accusation based merely on an individual's general reputation." Spinelli v. United States, 393 U.S. 410, 21 L.Ed.2d 637, 89 S.Ct. 584 (Jan. 27, 1969), which further explicated the principles of Aguilar.
This is particularly true when we consider the fact that only the probability, and not a prima facie showing, of criminal activity is the standard of probable cause, Beck v. Ohio, 379 U.S. 89, 96 (1964); that affidavits of probable cause are tested by much less rigorous standards than those governing the admissibility of evidence at trial, McCray v. Illinois, 386 U.S. 300, 311 (1967); that in judging probable cause issuing magistrates are not to be confined by ... restrictions on the use of their common sense, United States v. Ventresca, 380 U.S. 102, 108 (1965); and that their determination of probable cause should be paid great deference by reviewing courts, Jones v. United States, 362 U.S. 257, 270-271 (1960).
Spinelli v. United States, supra. Also see State v. Walcott, 72 Wn.2d 959, 435 P.2d 994 (1967) and Little v. Rhay, 68 Wn.2d 353, 413 P.2d 15 (1966).
*238 Defendant next asserts that there was insufficient evidence to convict him of the charge because the state failed to prove satisfactorily that he had possession of the heroin. We find otherwise. There was substantial competent evidence to support the findings of the trial court. The heroin uncovered in apartment No. 1 was found hidden inside a tire, under a mattress, behind the stove and within a crevice under the sink. A federal narcotics agent observed the defendant using that apartment during the early morning hours on each of the 2 days immediately preceding the search and arrest; defendant had a key to the apartment and admitted using it as a radio and electronic equipment repair shop; he kept a considerable amount of repair equipment and personal clothing in the apartment; and, according to the apartment house owner, no one other than the defendant occupied apartment No. 1 during the period of time material to this cause. Such evidence strongly supports the trial court's finding that defendant had dominion and control of apartment No. 1 and was, therefore, in willful and unlawful possession of the heroin found therein. State v. Walcott, supra.
The judgment and sentence is affirmed.
HUNTER, C.J., HAMILTON and NEILL, JJ., and JOHNSEN, J. Pro Tem., concur.
NOTES
[*] Reported in 456 P.2d 337.
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In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 07-4023
JEAN M C C ARTER, et al.,
Plaintiffs-Appellants,
v.
R ETIREMENT P LAN FOR THE D ISTRICT M ANAGERS OF THE
A MERICAN F AMILY INSURANCE G ROUP, et al.,
Defendants-Appellees.
____________
Appeal from the United States District Court
for the Western District of Wisconsin.
No. 3:07-cv-00206-bbc—Barbara B. Crabb, Chief Judge.
____________
A RGUED M AY 28, 2008—D ECIDED S EPTEMBER 2, 2008
____________
Before E ASTERBROOK, Chief Judge, and R IPPLE and
W OOD , Circuit Judges.
E ASTERBROOK, Chief Judge. American Family Insurance
Group amended its pension plans in 1997 to allow partici-
pants to elect cash distributions (with values actuarially
equal to the participants’ vested pensions) when they
leave its employ. As amended, the plans give workers
90 days to choose whether to take lump sums immedi-
2 No. 07-4023
ately or annuities when they reach retirement age. Plain-
tiffs exercised the lump-sum option. Now they regret
their decisions and say that the plans should have let
them defer the choice until normal retirement age. Allow-
ing only 90 days makes people too likely to accept cash,
plaintiffs maintain. Although a lump-sum distribution
must be rolled over into another pension investment, it
can be withdrawn and spent (after a tax penalty has been
paid), leaving people with less income at retirement age.
Plaintiffs believe that they are entitled to choose
again—and, even if they have dissipated the money
they received, that they remain entitled to an annuity
once they reach retirement age.
None of the plaintiffs is willing to restore the cash to
the pension plan. This led the district court to dismiss
the suit for want of standing. The plaintiffs got what
they asked for (immediate distribution) and can’t com-
plain about the lack of a windfall (the value of the
pension twice: once in cash and again as an annuity). But
if the Employee Retirement Income Security Act (ERISA)
entitles them to revoke their elections yet keep the cash,
it is not appropriate to dismiss the suit for lack of a case
or controversy. Pension plans may distribute their bene-
fits as lump sums only with participants’ consent,
29 U.S.C. §1053(e)(1), and plaintiffs maintain that their
consents are void because they should have had more time
to choose. The injury they assert—that monthly income
at retirement age is diminished if participants are stam-
peded into taking cash, which then burns holes in their
pockets—can be traced to the plans’ terms and can be
redressed by a judgment in plaintiffs’ favor. No more is
No. 07-4023 3
required for standing. See Lujan v. Defenders of Wildlife, 504
U.S. 555, 560–61 (1992). Plaintiffs’ claim may be weak, but
the shortcomings of a legal theory differ from a lack of
subject-matter jurisdiction. Bell v. Hood, 327 U.S. 678 (1946).
American Family tells us that it gives departing employ-
ees only 90 days to choose because an indefinitely long
window would lead to adverse selection. Ex-employees
would be tempted to wait to see how their health and
family circumstances developed. Those whose health
deteriorated would take the lump-sum option, because
income deferred past death is useless (you can’t take it
with you) unless the participant wants to make a bequest;
likewise those without a spouse or children would take
the cash and buy an annuity that lacked survivorship
features and thus paid a higher monthly benefit. Mean-
while healthy ex-workers, and those with large families,
would take the pension option. A pension plan with
longer-lived participants, or more than the average
number of people eligible for survivors’ benefits, is more
expensive to maintain. Giving ex-workers a short time
to elect between cash and an annuity reduces the oppor-
tunity for strategic behavior that is costly not only for
the plan but also for other participants, whose benefit
levels must be cut if the employer wants to keep pension
costs stable. (This also shows another reason why plain-
tiffs suffered injury in fact: a lump-sum option open for
a brief time is worth less to the participant than an option
that is always available and can be exercised at a well
chosen moment.)
Plaintiffs do not deny that adverse selection is the likely
outcome of a long window. But they say that the cost
4 No. 07-4023
to the employer is irrelevant under 26 C.F.R.
§1.411(a)–11(c)(2)(i), which they read to provide that no
pension plan may impose a “significant detriment” on
a participant who declines the opportunity for a cash
distribution. This is the language on which plaintiffs rely:
No consent [to immediate distribution of a lump
sum] is valid unless the participant has received a
general description of the material features of the
optional forms of benefit available under the
plan. In addition, so long as a benefit is immedi-
ately distributable, a participant must be informed
of the right, if any, to defer receipt of the distribu-
tion. Furthermore, consent is not valid if a signifi-
cant detriment is imposed under the plan on any
participant who does not consent to a distribution.
Whether or not a significant detriment is imposed
shall be determined by the Commissioner by
examining the particular facts and circumstances.
This regulation does not help plaintiffs, for two prin-
cipal reasons.
First, although subsection (c)(2)(i) when read alone
sounds like a substantive regulation of pension plans, the
context shows otherwise. This is a tax regulation, and it
defines whether a pension plan is qualified for favorable
tax treatment (principally deferral of income tax on the
value of pension contributions). Subsection 1.411(a)–11(a)
sets out the consequence of failure to satisfy the require-
ments in the other subsections: “If the consent require-
ments or the valuation rules of this section are not satis-
fied, the plan fails to satisfy the requirements of [26
No. 07-4023 5
U.S.C. §411(a)].” Section 411 spells out which plans are
“qualified trusts” meeting the standards of 26 U.S.C. §401
for tax deferral. Plaintiffs equate “not tax-qualified” with
“not lawful,” but there’s no basis for thinking that only
those pension plans eligible for tax benefits are lawful
under ERISA. See Brengettsy v. LTV Steel Hourly Pension Plan,
241 F.3d 609 (7th Cir. 2001). Many pension plans provide
benefits exceeding the maximum on which taxes can be
deferred, and so are not tax-qualified, but are perfectly
lawful; likewise top-heavy plans (those that provide
extra benefits to workers with higher incomes) may be
ineligible for tax deferral but satisfy all of ERISA’s sub-
stantive rules.
Second, even if §1.411(a)–11(c)(2)(i) established sub-
stantive requirements, it would not entitle plaintiffs to
relief. They want us to treat the need to make a prompt
choice as a “significant detriment”. That can’t be so;
subsection (c)(2)(i) says that the participant must be
informed of “the right, if any, to defer receipt of the distri-
bution” (emphasis added), which must mean the lack of
a right to defer receipt of cash is not itself a “significant
detriment”.
Having a limited time to choose cash does not diminish
the value of a pension. Until 1997 employees who left
American Family were not entitled to lump-sum distribu-
tions; they had to wait for an annuity to commence at
retirement age. When the option to take a cash distribu-
tion was added in 1997, the value of the annuity was
unchanged. Adding a lump-sum option to an existing
(and entirely lawful) pension annuity does not create a
6 No. 07-4023
“detriment” of any kind; it bestows a benefit by making
the package of options more valuable. Participants do not
lose anything (other than the opportunity to receive an
immediate distribution) by turning down the lump-
sum offer.
Pension and welfare plans often contain limited-time
opportunities. Think of an opportunity to take early
retirement. That offer would be worth more if held open
for a longer time, but extending an offer with a short
fuse does not diminish the value of the regular pension
benefit or otherwise make the choice involuntary. As
we concluded in Henn v. National Geographic Society,
819 F.2d 824 (7th Cir. 1987), an offer that increases em-
ployees’ opportunities—the sort of offer that they would
pay to receive, rather than pay to avoid—is lawful, and
the choice is binding even if with the benefit of hindsight
the employee would have made a different election.
No more need be said about the merits, but a procedural
complication remains. After dismissing the suit, the district
court ordered plaintiffs to pay the plans’ legal fees. The
judge relied on 29 U.S.C. §1132(g), which allows fee-
shifting in ERISA actions when the loser’s position was
not substantially justified. (The statute itself is silent on
the standard; we borrowed “substantially justified” from
the Equal Access to Justice Act. See Bittner v. Sadoff &
Rudoy Industries, 728 F.2d 820, 828–31 (7th Cir. 1984).)
Plaintiffs want us to reverse this decision. The district
court has not, however, quantified the award, and until
it does the decision is not final. See, e.g., Riley v. Kennedy,
128 S. Ct. 1970, 1980–81 (2008); Liberty Mutual Insurance
Co. v. Wetzel, 424 U.S. 737 (1976).
No. 07-4023 7
When raising this subject on appeal, plaintiffs assumed
that awards of attorneys’ fees are covered by a single
notice of appeal from the final decision on the merits.
The Supreme Court held otherwise in White v. New Hamp-
shire Department of Employment Security, 455 U.S. 445 (1982),
concluding that awards of attorneys’ fees under fee-
shifting statutes are separate decisions, separately
appealable just like awards of costs. The Court reached
this conclusion in part to prevent disputes about the
timeliness of appeals and in part so that lingering con-
troversy about attorneys’ fees would not delay appel-
late resolution of the merits, which otherwise would
have to wait for the fees to be quantified. But the upshot
of White’s approach is that decisions on the merits and
decisions about attorneys’ fees are treated as separate
final decisions, which must be covered by separate
notices of appeal—each filed after the subject has inde-
pendently become “final.” Amendments to the Federal
Rules of Civil Procedure after White fortified the distinc-
tion between a final decision on the merits and a final
decision on attorneys’ fees (or costs). See Fed. R. Civ. P.
54(d)(2), 58(e). This is why we have been able to address
the merits of plaintiffs’ appeal even though the case
remains live in the district court until the judge has told
plaintiffs how much they must pay toward the plans’ legal
expenses. And it is also why we cannot reach that
dispute—not only because the decision about fees is not
final, but also because plaintiffs have not filed a notice
of appeal concerning that decision. (A timely notice of
appeal is a jurisdictional requirement. Bowles v. Russell,
127 S. Ct. 2360 (2007).)
8 No. 07-4023
Twenty-four years ago, we concluded in Bittner that
“pendent appellate jurisdiction” permits a court of
appeals to review a district court’s decision to award
attorneys’ fees to a prevailing party, even when the
fees have not been quantified and the award thus is not
final. 728 F.2d at 826–27. About a decade after Bittner,
however, the Supreme Court threw cold water on pendent
appellate jurisdiction. The Court observed in Swint v.
Chambers County Commission, 514 U.S. 35, 43–51 (1995), that
resolving appeals from non-final decisions is not only
incompatible with 28 U.S.C. §1291 but also unnecessary,
because Congress has authorized the judiciary to adopt
rules allowing interlocutory appeals. 28 U.S.C. §1292(e).
Swint pointedly remarked that these rules must be
adopted after public notice and comment, and approval
by the Judicial Conference and the Supreme Court: in
other words, that the subject has been taken out of the
hands of the intermediate appellate courts in the federal
system. Although Swint said that it was not ruling out
all possibility of pendent appellate jurisdiction, the
Court made clear that only the most extraordinary cir-
cumstances could justify the use of whatever power the
courts of appeals possess—and that even when circum-
stances are exceptional the availability of pendent appel-
late jurisdiction is doubtful. Swint itself held that a court
of appeals had erred in invoking pendent appellate
jurisdiction, because “judicial economy” is no warrant
for disregarding the statutory final-decision rule.
Swint supersedes Bittner, because there is nothing
extraordinary about a losing party’s desire to be rid of a fee
award before the obligation has been set. There is no
urgent need for haste, and a substantial reason to wait—for
No. 07-4023 9
most awards are likely to be affirmed, and then a second
appeal will follow from the district judge’s order specify-
ing the amount of fees. Judicial economy cannot be
achieved by dividing one dispute across two appeals.
All that results from multiple appeals is delay and expense.
That’s precisely why appeal usually must await a final
decision.
Yet although Swint pulled the rug out from under
Bittner (as did the 1993 amendments to Rules 54 and 58
specifying that the merits and awards of attorneys’ fees
are separately appealable decisions), our circuit has
proceeded as if nothing had happened. At least two of our
post-Swint opinions invoke the doctrine of pendent
appellate jurisdiction to review awards of attorneys’ fees
before the district judge had decided how much was
due. See Lorillard Tobacco Co. v. A&E Oil, Inc., 503 F.3d 588
(7th Cir. 2007); Kokomo Tube Co. v. Dayton Equipment
Services Co., 123 F.3d 616, 621–22 (7th Cir. 1997). Neither
of these decisions mentions Swint; they proceed as if
Bittner were the last word.
Even before Swint, four courts of appeals had disagreed
with Bittner and held that appellate resolution must be
postponed until the amount of fees has been quantified.
See Cooper v. Salomon Brothers Inc., 1 F.3d 82, 84–85 (2d Cir.
1993); Pennsylvania v. Flaherty, 983 F.2d 1267, 1275–77 (3d
Cir. 1993); Southern Travel Club, Inc. v. Carnival Air Lines,
Inc., 986 F.2d 125, 129–31 (5th Cir. 1993); In re Modern
Textile, Inc., 900 F.2d 1184, 1192 (8th Cir. 1990). After Swint,
another circuit joined this group. American Soda, LLP v.
U.S. Filter Wastewater Group, Inc., 428 F.3d 921 (10th Cir.
2005). And although before Swint two circuits had fol-
10 No. 07-4023
lowed Bittner, see Andrews v. Employees’ Retirement Plan of
First Alabama Bancshares, Inc., 938 F.2d 1245, 1247–48 & n.6
(11th Cir. 1991); Morgan v. Union Metal Manufacturing, 757
F.2d 792, 795–96 (6th Cir. 1985) (dictum), neither of these
circuits has entertained a fee appeal under the approach
of pendent appellate jurisdiction after Swint. Indeed, as
far as we can see, no decision outside this circuit has
invoked pendent appellate jurisdiction since Swint to
entertain an appeal from an un-quantified award of at-
torneys’ fees. This circuit now stands alone.
Bittner preceded Swint and cannot be faulted for failing
to anticipate how the Supreme Court would approach
this subject. Now that the Justices have spoken, however,
we are not justified in adhering to an approach that
perpetuates an unnecessary conflict among the circuits.
The portions of Bittner, Kokomo Tube, and Lorillard Tobacco
that invoked pendent appellate jurisdiction are over-
ruled. An appeal may be taken from an award of attorneys’
fees only after that award is independently final—which
means, after the district judge had decided how much
must be paid. This decision was circulated to all active
judges under Circuit Rule 40(e). No judge favored a
hearing en banc.
The district court’s decision is modified to be on the
merits (as opposed to a dismissal for lack of standing), and
as so modified is affirmed. The appeal is dismissed to the
extent it seeks review of the non-final decision that plain-
tiffs must reimburse the defendants’ attorneys’ fees.
9-2-08
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169 B.R. 1 (1994)
In re John Carl DELBONIS, Armanda Delbonis, Debtors.
TI FEDERAL CREDIT UNION, Plaintiff,
v.
John Carl DELBONIS, Defendant.
Bankruptcy No. 93-18441-WCH. Adv. No. 93-2003.
United States Bankruptcy Court, D. Massachusetts.
June 22, 1994.
Theodore J. Koban, Attleboro, MA, for debtors.
Paul F. Lorincz, Coogan, Smith, Bennett, McGahan, Lorincz & Jacobi, Attleboro, MA, for TI Federal Credit Union.
DECISION
WILLIAM C. HILLMAN, Bankruptcy Judge.
This is an adversary proceeding brought by TI Federal Credit Union ("TI") against Debtor John Carl Delbonis ("Debtor") to determine the dischargeability of certain loans pursuant to 11 U.S.C. § 523(a)(8).[1]
*2 The parties have submitted the issues to the Court for decision on an agreed statement of facts. The debtor has also filed a motion for summary judgment.
Agreed Facts
1. TI is a Federal credit union organized under the Federal Credit Union Act, 12 U.S.C. § 1751 et seq. It is not a governmental unit, nor is it a state chartered nonprofit corporation. It is exempt from taxation to the extent provided by 12 U.S.C. § 1768.[2]
2. The loan monies advanced to Debtor were not guarantied or funded under any governmental program.
3. Between December 9, 1986 and January 4, 1991, TI extended $43,114,87 in loans (the "Loans") to Debtor. As of March 25, 1993 the principal balance due to TI was $32,618.27.
4. All loans were made under TI's "Education Loan" program. The terms of that program provide for a lower than standard interest rate. It is also required that all loan proceeds must be made payable to a school.
5. The loan proceeds were used solely for the educational expenses of Debtor's children and his wife. Neither Debtor's wife nor his children were liable for the repayment of the loans.
6. TI's Charter authorizes it to issue shares with a par value of $5.00. Section 5(c) of the By-Laws grants to the board of directors the "authority to declare and authorize the payment of annual or semiannual dividends on shares of members."
Discussion
Educational Loans
It has been stipulated that the proceeds of the Loans were used solely for the educational expenses of Debtor's children and wife. I agree with Judge Harrington that loans incurred to educate members of a debtor's family qualify as educational loans within the meaning of 11 U.S.C. § 523(a)(8). Education Resources Institute v. Wilcon (In re Wilcon), 143 B.R. 4 (D.Mass.1992).
Nonprofit Status
As applicable here, § 523(a)(8) makes nondischargeable educational loans "made under any program funded . . . by a . . . nonprofit institution." TI funded the Loans.
TI contends that it is a "nonprofit institution" as that term is used in the statute based upon its stipulated tax exemption under 12 U.S.C. § 1768, quoted above, as well as its exempt status for purposes of Federal income taxation pursuant to 26 U.S.C. § 501(c)(1)[3].
Prior to an amendment in 1984, it was required that the nonprofit institution be one "of higher education." See S.Rep. 230, 96th Cong., 1st Sess. 3 (1979) U.S.Code Cong. & Admin.News 1979, pp. 936, 937. The amendment struck those words, P.L. No. 98-353, § 454(a)(2), demonstrating a Congressional *3 intent to include all nonprofit organizations as eligible loan grantors who could benefit from the nondischargeability provision.
The issue appears to have been discussed in only two cases. In the first, Lincoln Park Community Credit Union v. Sinclair-Ganos (In re Sinclair-Ganos), 133 B.R. 382 (Bankr. W.D.Mich.1981), Judge Nims reasoned as follows:
"[N]o cases have been found which discuss, let alone support, the position that a credit union is a nonprofit institution for purposes of this subsection and no enlightening legislative history has been uncovered. Because a credit union is a lending institution which competes with banks, there is no apparent reason to give a credit union a more favorable position in proceedings determining the dischargeability of student loans."
Id. at 384.
In the later decision, Construction Equipment Federal Credit Union v. Roberts (In re Roberts), 149 B.R. 547 (C.D.Ill.1993), Judge Mills specifically disagreed with Sinclair-Ganos:
"Clearly, credit unions are different from banks and not in direct competition with each other as suggested by the Sinclair-Ganos court since banks do not have the same geographical limitations and restrictions concerning to whom loans can be made as credit unions. Accordingly, this Court does not agree that the similarities between these institutions warrant an interpretation of § 523(a)(8) which is against the plain language of the statute."
Id. at 551. These remarks appear to be obiter dicta since, as he states, "In the case at bench, it is not disputed that the Credit Union is a nonprofit institution." Id.
In any event, I do not believe that the extent to which a federal credit union resembles a bank should be determinative of the issue before the court.
The Federal Credit Union Act defines a federal credit union as "a cooperative association organized . . . for the purpose of promoting thrift among its members and creating a source of credit for provident and productive purposes." 12 U.S.C. § 1752(1). It is authorized to pay dividends on its shares. 12 U.S.C. § 1763. These functions could be accomplished by a profit making organization.
The fact that TI is exempted from non-property taxation on the basis of its creation under the Federal Credit Union Act, or its freedom from taxation under the Internal Revenue Code does not of itself qualify it as a nonprofit institution.
There is no necessary correlation between tax exempt status and nonprofit status. As just one example, a religious organization which expends a substantial part of its activities in intervening in political campaigns is still not organized for profit even though it is barred from tax exempt status by 26 U.S.C. § 501(c)(3).
I have been unable to find a definition of "nonprofit organization" in the abstract. It generally appears in a statute where it is defined. The Bankruptcy Code is certainly in the minority in not providing guidance in this regard.
The nearest resemblance to a common law rule appears to be the decision in Read v. Tidewater Coal Exchange, Inc., 13 Del.Ch. 195, 116 A. 898 (1922). The Chancellor was required to determine whether the defendant corporation could have been properly formed under the Delaware general corporation law for non-profit purposes. The decision required a detailed examination of the issue
"When may a corporation be said to be organized not for profit. Or, putting the converse of the question, when may a corporation be said to be organized for profit?"
13 Del.Ch. at 208, 116 A. at 904.
The following remarks are helpful:
"Whether dividends are expected to be paid may, generally speaking, be taken as the test by which we are to determine whether, or not, a given corporation is organized for profit. Perhaps a better way to put it would be to say that a corporation is for profit when its purpose is, whether dividends are intended to be declared or not, to make a profit on the business it does. . . . Nor would a mere declaration in *4 its certificate of incorporation that it was organized not for profit, be sufficient to stamp upon it a nonprofit character. In each case, when the corporation is examined, the true facts must be ascertained and the corporation judged accordingly, no matter what its scheme of operation or its pretensions may be."
13 Del.Ch. at 209-210, 116 A. at 904.
I agree with the decision in Read. In my opinion non-profit organizations do not normally have shareholders nor do they pay dividends to those involved in them. Since TI does both, I find that it is not a nonprofit organization within the meaning of § 523(a)(8). As a result, the loans to Debtor are not loans which could be held to be nondischargeable under that section.
Debtor's motion for summary judgment must be granted. A separate order will be entered.
Debtor has also moved for the assessment of fees and costs pursuant to 11 U.S.C. § 523(d). Considering the novelty of the basic issue involved in this case, I do not believe that TI's position was "not substantially justified" and the motion is denied.
NOTES
[1] "§ 523. Exceptions to discharge
(a) A discharge under section 727, 1141, 1228(a), 1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt
. . . . .
(8) for an educational benefit overpayment or loan made, insured or guaranteed by a governmental unit, or made under any program funded in whole or in part by a governmental unit or nonprofit institution, or for an obligation to repay funds received as an educational benefit, scholarship or stipend, unless
(A) such loan, benefit, scholarship, or stipend overpayment first became due more than 7 years (exclusive of any applicable suspension of the repayment period) before the date of the filing of the petition; or
(B) excepting such debt from discharge under this paragraph will impose an undue hardship on the debtor and the debtor's dependents. . . ."
[2] "The Federal credit unions organized hereunder . . . shall be exempt from all taxation now or hereafter imposed by the United States or by any State, Territorial, or local taxing authority; except that any real property and any tangible personal property of Federal credit unions shall be subject to Federal, State, Territorial and local taxation to the same extent as other similar property is taxed." 12 U.S.C. § 1768 (passim).
[3] "(a) Exemption from taxation. An organization described in subsection (c) . . . shall be exempt from taxation. . . .
"(c) List of exempt organizations. The following organizations are referred to in subsection (a):
(1) any corporation organized under Act of Congress which is an instrumentality of the United States but only if such corporation
(A) is exempt from Federal income taxes
(i) under such Act as amended and supplemented before July 18, 1984, or
(ii) under this title without regard to any provision of law which is not contained in this title and which is not contained in a revenue Act. . . ." 26 U.S.C. § 501 (passim).
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705 F.2d 440
N. L. R. B.v.Eastern Food Service, Inc.
82-1490
UNITED STATES COURT OF APPEALS First Circuit
3/2/83
1
N.L.R.B.
AFFIRMED
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United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT February 14, 2006
Charles R. Fulbruge III
Clerk
No. 05-40134
Summary Calendar
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
ROY SALINAS,
Defendant-Appellant.
--------------------
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 2:04-CR-508-2
--------------------
Before REAVLEY, JOLLY and OWEN, Circuit Judges.
PER CURIAM:*
A jury convicted Roy Salinas of conspiracy and possession
with intent to distribute 368 kilograms of marijuana. Salinas
was sentenced to 120 months in prison and an eight-year term of
supervised release.
In his sole issue on appeal, Salinas argues that there was
insufficient evidence to support the jury’s verdict. The crux of
Salinas’s argument is that there is a logical explanation for
seemingly incriminating facts and that there was evidence that
others could have been the culprits. “This argument ignores the
*
Pursuant to 5TH CIR. R. 47.5, the court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
No. 05-40134
-2-
standard of appellate review; the Government is not required to
present enough evidence to exclude every hypothesis of
innocence.” United States v. Jones 133 F.3d 358, 362 (5th Cir.
1998) (internal quotation marks and citation omitted).
Viewed in the light most favorable to the Government, the
evidence adduced at trial was as follows. See Jones, 133 F.3d at
362. Salinas drove a red Freightliner truck for Lionel Gutierrez
(Gutierrez). On September 3, 2004, Salinas called Elam Trucking
Company, Inc. (ETC) to state that he was ready to accept a long-
haul driving job. ETC assigned Salinas to drive to Indiana with
a load of flour from Azteca Mills in Texas. Someone other than
Salinas picked up the trailer full of flour from Azteca Mills.
Salinas, however, made several cellular telephone calls to
Catalino Gutierrez (Catalino) on the 3rd of September. Salinas
told officers that Catalino drove a gray Ford Mustang.
On the evening of September 3rd, Heriberto Huerta received a
call from a man he identified only as “Chino.” Chino asked
Huerta to drive a load of drugs from Huerta’s home to Houston.
Huerta agreed and later that evening, Chino and another unknown
man arrived at Huerta’s house with the red Freightliner and the
trailer full of flour and marijuana. Although Chino usually
drove a gray Ford Mustang, he and his companion were in a dark
blue Buick when they arrived at Huerta’s house. Huerta, who did
not possess a commercial driver’s license, was told that Chino’s
No. 05-40134
-3-
companion, who was driving the blue Buick, would pick up the
person who would drive the truck from Houston.
Huerta was detained at the checkpoint when drug-sniffing
dogs alerted on the red Freightliner. Approximately nine minutes
after Huerta pulled into the checkpoint, the dark blue Buick
arrived at the checkpoint. Salinas was a passenger in the Buick,
and his brother Rudy Salinas (Rudy) was the driver. Salinas
claimed ownership of the vehicle. The Buick was also detained
based on the canine’s alert, and a homemade marijuana pipe was
found in the Buick. Although there was much commotion
surrounding the search of the red Freightliner, which Salinas
regularly drove, a mere 35 feet away from Salinas and Rudy,
neither man looked over in that direction.
Officers found a notebook bearing the names of Salinas and
his wife, as well as clothing matching the style and size of
those worn by Salinas, in the cab of the freightliner.
Additionally, Salinas was found to be in possession of a
commercial driver’s license. Further, the broken cargo seal that
had been placed on the trailer at Azteca Mills was found in the
trunk of the Buick. Finally, Rudy placed a call to Catalino
while he and Salinas were still detained at the checkpoint.
Although the evidence against Salinas was circumstantial,
the development and collocation of circumstances was sufficient
to prove a conspiracy. See United States v. Medina, 161 F.3d
867, 872 (5th Cir. 1998); United States v. Gonzales, 79 F.3d 413,
No. 05-40134
-4-
423 (5th Cir. 1996). Salinas gave several inconsistent
statements to the officers investigating the case. The jury was
free to reject Salinas’s theory of defense that there was an
innocent explanation for everything that happened. Given the
facts of the case, a reasonable jury could have found that the
evidence established Salinas’s guilt beyond a reasonable doubt on
both the conspiracy and the possession counts. See United States
v. Jaramillo, 42 F.3d 920. 922-23 (5th Cir. 1995).
AFFIRMED.
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Matter of Trainer v State of N.Y. Div. of Hous. & Community Renewal (2018 NY Slip Op 04105)
Matter of Trainer v State of N.Y. Div. of Hous. & Community Renewal
2018 NY Slip Op 04105
Decided on June 7, 2018
Appellate Division, First 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 June 7, 2018
Renwick, J.P., Richter, Webber, Kern, Moulton, JJ.
6822 101227/16
[*1]In re Terence Trainer, Petitioner-Appellant,
vState of New York Division of Housing and Community Renewal, Respondent-Respondent. 401 Edgecombe Partners, LLC, Respondent-Intervenor-Respondent.
Himmelstein, McConnell, Gribben, Donoghue & Joseph LLP, New York (Jesse Gribben of counsel), for appellant.
Mark F. Palomino, New York (Aida Patricia Reyes of counsel), for State of New York Division of Housing and Community Renewal, respondent.
Sperber Denenberg & Kahan, P.C., New York (Eric H. Kahan of counsel), for 401 Edgecombre Partners, LLC, respondent.
Order and judgment (one paper) of the Supreme Court, New York County (Arlene P. Bluth, J.), entered July 10, 2017, to the extent it denied the petition to vacate respondent State of New York Division of Housing and Community Renewal's determination dated July 28, 2015, denying petitioner's rent overcharge complaint, and dismissed the proceeding brought pursuant to CPLR article 78, unanimously affirmed, without costs.
Respondent's determination that there was no rent overcharge, based largely on its interpretation of the statutes it administers, was not arbitrary and capricious, particularly in light of the fact that the vacancy lease petitioner originally executed was not for a rent stabilized apartment (see Matter of Ansonia Residents Assn. v New York State Div. of Hous. & Community Renewal, 75 NY2d 206, 213 [1989]; Matter of Hawthorne Gardens v State of New York Div. of Hous. & Community Renewal, 4 AD3d 135, 136 [1st Dept 2004]; CPLR 7803[3]). To the extent petitioner argues that the landlord is estopped from arguing that the apartment is rent stabilized because he and petitioner erroneously executed a renewal lease for a rent stabilized apartment, before the owner realized it was sent in error and notified petitioner of the error, "[r]ent stabilization coverage is a matter of statutory right and cannot be created by waiver or estoppel" (Ruiz v Chwatt Assoc., 247 AD2d 308 [1st Dept 1998]; see also 546 W. 156th St. HDFC v Smalls, 43 AD3d 7, 12 [1st Dept 2007]).
As DHCR concluded, the legal regulated rent on the base date of December 15, 2006 was $1,722.23 for the period from March 1, 2006 to February 28, 2007. Tenants Rachels and Brooks then rented the apartment from June 1, 2007 to February 19, 2008, and received a Notice to First Tenant of Apartment Deregulated After Vacancy Due to a Rent of $2,000 or More, which showed that when the statutory vacancy allowance of $292.78 was added to the then legal regulated rent of $1,722.23, the legal regulated rent rose to $2,015.01 (see Rent Stabilization Law [RSL] § 26-516(a)(2); Rent Stabilization Code [RSC] § 2520.6[f][1]; 2526.1(a)(2). Thus, by the time petitioner took occupancy, the apartment was deregulated (RSC § 2520.11[r][4]). In these circumstances, DHCR was not required to inquire further past the base date to ascertain whether the apartment in question was lawfully deregulated.
Pursuant to the recent ruling by the Court of Appeals in Altman v 285 W. Fourth LLC, ___ NY3d ___, 2018 Slip Op 02829 [2018]), the legal regulated rent for petitioner's apartment [*2]would have crossed the $2,000 threshold and would have been deregulated by the time of his lease commencing March 1, 2008, even assuming the rent during the prior Rachels/Brooks tenancy is disregarded as not properly registered pursuant to RSL § 26-517[a].
Nor does the record show substantial indicia of fraud to warrant an inquiry beyond the four-year statute of limitations to ascertain whether the rent on the base date is a lawful rent (Matter of Grimm v State of N.Y. Div. of Hous. and Community Renewal Off. of Rent Admin., 15 NY3d 358, 366 [2010]; Thornton v Baron, 5 NY3d 175, 181 [2005]; see RSL § 26-516 [a]). Although petitioner correctly notes that there was a significant increase in rent from 2003 to 2004, that increase and a few discrepancies in the registration statement do not suffice as indicia of fraud to require DHCR to inquire beyond the four-year statute of limitations (Grimm, 15 NY3d at 367).
We have considered petitioner's remaining contentions and find them unavailing or not properly before this Court.
THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.
ENTERED: JUNE 7, 2018
CLERK
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Nebraska Supreme Court Online Library
www.nebraska.gov/apps-courts-epub/
05/15/2020 08:08 AM CDT
- 176 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
SABINO v. OZUNA
Cite as 305 Neb. 176
Ariana Bernal Sabino, appellant, v.
Juan Carlos Genchi Ozuna, appellee.
___ N.W.2d ___
Filed March 6, 2020. No. S-18-110.
1. Statutes. Statutory interpretation presents a question of law.
2. Judgments: Appeal and Error. An appellate court independently
reviews questions of law decided by a lower court.
3. Divorce: Appeal and Error. In a marital dissolution action, an appellate
court reviews the case de novo on the record to determine whether there
has been an abuse of discretion by the trial judge.
4. Evidence: Appeal and Error. In a review de novo on the record, an
appellate court is required to make independent factual determinations
based upon the record, and the court reaches its own independent con-
clusions with respect to the matters at issue.
5. Judges: Words and Phrases. A judicial abuse of discretion exists if the
reasons or rulings of a trial judge are clearly untenable, unfairly depriv-
ing a litigant of a substantial right and denying just results in matters
submitted for disposition.
6. Statutes: Time. Amendments to Neb. Rev. Stat. § 43-1238(b) (Cum.
Supp. 2018) were procedural and applicable to pending cases.
7. Courts: Minors. The role of state courts in the special immigrant juve-
nile status determination is to make the findings of fact necessary to the
U.S. Citizenship and Immigration Service’s legal determination of the
immigrant child’s entitlement to special immigrant juvenile status.
8. Courts: Federal Acts: Minors. Federal law affirms the institutional
competence of state courts as the appropriate forum for child welfare
determinations regarding abuse, neglect, and abandonment, as well
as a child’s best interests. But it is not the role of the state court to
make a determination as to whether a child will ultimately be eli-
gible for special immigrant juvenile status; that is a determination
reserved for the U.S. Citizenship and Immigration Service and the
federal government.
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Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
SABINO v. OZUNA
Cite as 305 Neb. 176
9. Courts: Minors. That a court is requested to make special immigrant
juvenile status findings does not mean that it must make findings favor-
able to the party seeking them.
10. Courts: Minors: Evidence. Courts asked to make special immigrant
juvenile status findings may conclude that there was insufficient evi-
dence or that the evidence was not credible.
Appeal from the District Court for Douglas County: Peter
C. Bataillon, Judge. Reversed and remanded for further
proceedings.
Roxana Cortes Reyes, of Immigrant Legal Center, an affili-
ate of the Justice For Our Neighbors Network, for appellant.
No appearance for appellee.
Heavican, C.J., Miller-Lerman, Cassel, Stacy, Funke,
Papik, and Freudenberg, JJ.
Heavican, C.J.
INTRODUCTION
The Douglas County District Court dissolved the marriage
of Ariana Bernal Sabino and Juan Carlo Genchi Ozuna and
awarded full custody of the parties’ child to Sabino. Sabino
sought specific findings of fact for purposes of special immi-
grant juvenile (SIJ) status under federal law. The district court
declined to make such findings, and Sabino appealed. We
reverse, and remand for further proceedings.
FACTUAL BACKGROUND
According to an affidavit offered into evidence by Sabino at
trial, she and Ozuna met in Cuatro Bancos, Guerrero, Mexico,
in approximately 2000. Sabino was born in Cuatro Bancos, and
she was 13 years old when she met Ozuna. A year later, she
and Ozuna moved in together, and 5 months after that, Ozuna
began to physically assault Sabino. Sabino became pregnant
in May 2003, and she and Ozuna were married in November.
Throughout this time, Ozuna continued to physically assault
Sabino. In December, Sabino left Ozuna and returned to her
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305 Nebraska Reports
SABINO v. OZUNA
Cite as 305 Neb. 176
parents’ home. According to Sabino’s affidavit, just 1 week
later, Ozuna moved in with another woman.
Sabino averred that Ozuna was aware of her pregnancy and
of the due date of the baby. Sabino also averred that Ozuna
was aware of where she was staying. Sabino stated that Ozuna
never attempted to see her or the baby and provided no finan-
cial assistance.
According to her affidavit, Sabino was unable to provide
for the couple’s son on her own and came to the United States
when her son was 20 months old. Sabino left her son in
Mexico with her mother and sent money to cover his expenses.
She also spoke with him on the telephone frequently. In August
2016, Sabino’s son and mother, who was also a victim of
domestic violence at the hands of Sabino’s father, left Mexico
for the United States.
In June 2017, Sabino filed a complaint in the Douglas
County District Court for the dissolution of marriage. Ozuna
entered a voluntary appearance in October, but did not person-
ally appear. Trial was held on November 8. Sabino testified
through a Spanish language interpreter that she was married to
Ozuna and was seeking a divorce because Ozuna had hit her,
that she had been separated from him for over 13 years, and
that she did not believe the marriage could be saved. Sabino
sought an award of all of the property in her possession and
custody of the parties’ son.
Because Sabino had borne children from other relationships
while Sabino and Ozuna were married, the trial court contin-
ued the trial in order for Sabino to gather evidence rebutting
the statutory presumption that Ozuna was the father of those
children. The trial resumed on January 11, 2018, at which time
evidence rebutting that presumption was offered.
In addition to the proof of paternity for her other children,
Sabino offered exhibit 4, which was a photocopy of materials
from the U.S. Citizenship and Immigration Services explaining
“Special Immigrant Juvenile Status.” According to this exhibit,
SIJ status is available to children who present in the United
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305 Nebraska Reports
SABINO v. OZUNA
Cite as 305 Neb. 176
States without legal immigration status because they have been
“abused, abandoned, or neglected by a parent.” As relevant to
this appeal, exhibit 4 notes: “Juvenile courts issue orders that
help determine a child’s eligibility for SIJ status. . . . The role
of the court is to make factual findings based on state law
about the abuse, neglect, or abandonment; family reunification;
and best interests of the children.”
Following admission of this evidence, the court made cer-
tain inquiries of Sabino while she was on the witness stand.
Specifically, the court asked Sabino whether she or her mother
had “any legal authority to live in the United States.” Sabino’s
counsel objected on relevancy grounds, noting that it went
to neither “the best interest of the child [n]or the divorce
proceedings.”
The court then made an oral pronouncement (with an accom-
panying written decree) granting the divorce and awarding
custody to Sabino, subject to Ozuna’s reasonable visitation at
Sabino’s reasonable discretion. Ozuna was also ordered to pay
$50 per month in child support.
As relevant to this appeal, the court also stated:
The Court makes no decision as to the other issues that
[Sabino] has requested with regard to abandonment in
Mexico, abuse in Mexico, and things of that nature, as the
Court does not have adequate information as to why the
child could not live safely in some part of Mexico.
In addition, the Court does find that it’s relevant as
to whether [Sabino] is legally in the United States, if
her mother is legally in the United States, things of that
nature. And if she refuses to answer those, then I’m not
going to go any further with asking other questions in
this matter.
The Court’s also concerned as to whether it’s even
within my purview to makes [sic] these determinations. If
I do make these — if this is in my purview to make these
determinations, then I need a lot more evidence to make
that determination. For sure I need evidence as to how
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Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
SABINO v. OZUNA
Cite as 305 Neb. 176
paragraph 7 [of Sabino’s affidavit, detailing her mother’s
flight to the United States due to domestic violence,] was
arrived at. . . . Sabino . . . doesn’t know how the informa-
tion in paragraph 7 was obtained. If she doesn’t know,
then that is somewhat of a crux of the information in
this matter.
The district court signed a decree prepared by Sabino’s coun-
sel that included the findings sought regarding abuse, neglect,
or abandonment; family reunification; and best interests of the
child. However, the court struck through those findings and
therefore did not make the findings requested by Sabino.
Sabino appealed. In a prior opinion, we concluded that the
district court erred in not allowing Sabino to proceed in forma
pauperis.1 We are now presented with the merits of Sabino’s
appeal.
ASSIGNMENT OF ERROR
Sabino assigns three assignments of error that can be con-
solidated as one: The district court erred in not making the
findings of fact requested by Sabino.
STANDARD OF REVIEW
[1,2] Statutory interpretation presents a question of law.2
We independently review questions of law decided by a lower
court.3
[3-5] In a marital dissolution action, an appellate court
reviews the case de novo on the record to determine whether
there has been an abuse of discretion by the trial judge.4 In a
review de novo on the record, an appellate court is required
to make independent factual determinations based upon the
record, and the court reaches its own independent conclusions
1
See Sabino v. Ozuna, 303 Neb. 318, 928 N.W.2d 778 (2019).
2
In Re Guardianship of Carlos D., 300 Neb. 646, 915 N.W.2d 581 (2018).
3
Id.
4
Burgardt v. Burgardt, 304 Neb. 356, 934 N.W.2d 488 (2019).
- 181 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
SABINO v. OZUNA
Cite as 305 Neb. 176
with respect to the matters at issue.5 A judicial abuse of discre-
tion exists if the reasons or rulings of a trial judge are clearly
untenable, unfairly depriving a litigant of a substantial right
and denying just results in matters submitted for disposition.6
ANALYSIS
This appeal generally presents the question of whether the
district court had the authority to make the findings of fact
requested by Sabino and, if so, whether there was sufficient
evidence for the court to make those findings. Each issue will
be addressed in turn.
District Court’s Authority.
[6] The district court in this case had the authority to make
the findings sought by Sabino. Neb. Rev. Stat. § 43-1238(b)
(Cum. Supp. 2018) provides:
In addition to having jurisdiction to make judicial deter-
minations about the custody and care of the child, a court
of this state with exclusive jurisdiction under subsection
(a) of this section [setting forth when a court has juris-
diction to make an initial child custody determination]
has jurisdiction and authority to make factual findings
regarding (1) the abuse, abandonment, or neglect of the
child, (2) the nonviability of reunification with at least
one of the child’s parents due to such abuse, abandon-
ment, neglect, or a similar basis under state law, and (3)
whether it would be in the best interests of such child to
be removed from the United States to a foreign country,
including the child’s country of origin or last habitual
residence. If there is sufficient evidence to support such
factual findings, the court shall issue an order containing
such findings when requested by one of the parties or
upon the court’s own motion.
5
Id.
6
Id.
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305 Nebraska Reports
SABINO v. OZUNA
Cite as 305 Neb. 176
Although the amendments to § 43-1238 were not effective until
July 19, 2018, which was several months after the order was
issued in this case, we recently held in In re Guardianship of
Carlos D.7 that the change made to § 43-1238(b) was proce-
dural and thus applied to pending cases.
The language of § 43-1238 provides that if a court has
jurisdiction to make an initial child custody determination,
it also has the jurisdiction and authority to make the factual
findings relevant to SIJ status. In this case, the record shows
that the child’s home state for purposes of § 43-1238(a)
was Nebraska, and, as such, the court had the jurisdiction to
make an initial child custody determination and to make the
requested findings.
Sufficient Evidence.
Section 43-1238 provides that “[i]f there is sufficient evi-
dence to support such factual findings, the court shall issue an
order containing such findings when requested by one of the
parties or upon the court’s own motion.”
[7,8] Having concluded that the court has the authority to
make these findings, we turn to an examination of what these
factfinding courts should consider when doing so. The role of
state courts in the SIJ status determination is to make the find-
ings of fact necessary to the U.S. Citizenship and Immigration
Service’s legal determination of the immigrant child’s entitle-
ment to SIJ status.8 Federal law affirms the institutional com-
petence of state courts as the appropriate forum for child
welfare determinations regarding abuse, neglect, and aban-
donment, as well as a child’s best interests.9 But it is not the
role of the state court to make a determination as to whether
7
In re Guardianship of Carlos D., supra note 2.
8
8 U.S.C. § 1101(a)(27)(J)(iii) (Reissue 2018).
9
See, Guardianship of Penate, 477 Mass. 268, 76 N.E.3d 960 (2017);
H.S.P. v. J.K., 223 N.J. 196, 121 A.3d 849 (2015); Kitoko v. Salomao, 215
A.3d 698 (Vt. 2019); In re Y.M., 207 Cal. App. 4th 892, 144 Cal. Rptr. 3d
54 (2012); Simbaina v. Bunay, 221 Md. App. 440, 109 A.3d 191 (2015).
- 183 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
SABINO v. OZUNA
Cite as 305 Neb. 176
a child will ultimately be eligible for SIJ status; that is a
determination reserved for the U.S. Customs and Immigration
Service and the federal government.10
[9,10] That a court is requested to make findings for pur-
poses of SIJ status does not mean that it must make findings
favorable to the party seeking them.11 Courts asked to make
these findings may conclude that there was insufficient evi-
dence or that the evidence was not credible.12
Federal law provides:
Applications for asylum and other forms of relief from
removal in which an unaccompanied alien child is the
principal applicant shall be governed by regulations which
take into account the specialized needs of unaccompanied
alien children and which address both procedural and
substantive aspects of handling unaccompanied alien chil-
dren’s cases.13
Courts in other jurisdictions have interpreted this language
as a caution to courts to not place insurmountable evidentiary
burdens on SIJ petitioners, because those seeking that status
will have limited abilities to corroborate testimony with addi-
tional evidence.14
In this case, the district court questioned both the record
before it and its authority, before concluding that it was not
“even within [its] purview” to make the findings sought by
Sabino. We conclude that although the court can and should
entertain a request for findings, the court’s powers as a fact
10
See, J.U. v. J.C.P.C., 176 A.3d 136 (D.C. 2018); Romero v. Perez, 463 Md.
182, 205 A.3d 903 (2019); Guardianship of Penate, supra note 9; Kitoko v.
Salomao, supra note 9.
11
See, J.U. v. J.C.P.C., supra note 10; Romero v. Perez, supra note 10;
Kitoko v. Salomao, supra note 9; In re J.J.X.C., 318 Ga. App. 420, 734
S.E.2d 120 (2012).
12
See id.
13
8 U.S.C. § 1232(d)(8) (2018).
14
See, J.U. v. J.C.P.C., supra note 10; Romero v. Perez, supra note 10;
Kitoko v. Salomao, supra note 9.
- 184 -
Nebraska Supreme Court Advance Sheets
305 Nebraska Reports
SABINO v. OZUNA
Cite as 305 Neb. 176
finder to assess the credibility of a witness or judge the suffi-
ciency of evidence remain in effect. But nothing in this opinion
should be read to suggest what findings the court should make
on remand.
Because in this case the district court concluded that it
lacked the authority to make the requested findings, we accord-
ingly reverse the decision of the district court and remand the
cause for further proceedings.
CONCLUSION
The decision of the district court is reversed and the cause is
remanded for further proceedings.
Reversed and remanded for
further proceedings.
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349 F.2d 433
Application of Jesse T. DUNN and Alex E. Brodhag, Jr.
Patent Appeal No. 7265.
United States Court of Customs and Patent Appeals.
July 22, 1965.
Louis C. Smith, Jr., Francis M. Fazio, New York City, Paul A. Rose, Washington, D. C., for appellants.
Clarence W. Moore, Washington, D. C. (J. E. Armore, Washington, D. C., of counsel), for the Commissioner of Patents.
Before WORLEY, Chief Judge, and RICH, MARTIN, SMITH, and ALMOND, Judges.
MARTIN, Judge.
1
Appellant Dunn with one Proops obtained a series of five patents1 for improvements in a classic synthesis of acrylic acid esters obtained by reaction of acetylene, carbon monoxide and an alcohol in the presence of novel catalysts. The catalysts of each patent are complexes obtained by admixture of a nickel halide and a phosphorus-containing compound. The patents differ only with respect to the phosphorus-containing compounds, and each patent claims the respective invention in Jepson-form2 process claims in which the recited improvement is the particular catalyst.3
2
All five applications which later matured into the patents were filed on April 1, 1958. About four months later, on July 23, 1958, appellants Dunn and Brodhag filed the instant application serial No. 750,310 for "Improved Acrylic Acid Ester Synthesis."
3
The invention of the instant application is directed to an improvement, as is evident from the Jepson form claims, of the acrylic acid ester synthesis of the five patents, which improvement consists in the use of an inert N-alkyl pyrrolidone as the solvent medium. The 22 claims on appeal recite the acetylene, carbon monoxide, and alcohol reactants along with the nickel halide-phosphorus-containing compound catalysts of the five patents in the preamble, followed by the phrase "the improvement which consists of using an inert N-alkyl pyrrolidone as solvent medium in said process."
4
Claim 2, which is illustrative of those on appeal, reads as follows:
5
2. In a process for the production of esters of acrylic acid by the interaction of a saturated monohydric aliphatic alcohol with acetylene and carbod monoxide in the presence of a catalyst complex of a nickel halide and an organic phosphorus-sulfur-containing acid containing a pentavalent phosphorus atom having a thiono radical attached to said phosphorus atom as represented by the general formula:
6
NOTE: OPINION CONTAINING TABLE OR OTHER DATA THAT IS NOT VIEWABLE
7
wherein R" represents a member selected from the group consisting of a hydrogen atom and a nickel atom; (n) is an integer having a value of 1 and 2; and X represents a member selected from the group consisting of R, R', RZ, and R'Z radicals in which R and R' singly are members selected from the group consisting of alkyl radicals containing up to about 22 carbon atoms, aryl radicals selected from the group consisting of a phenyl radical and a naphthyl radical, and trihydrocarbylsilanyl radicals; Z represents a member selected from the group consisting of an oxygen atom and an amido radical; and when taken together RZ and R'Z represent a cyclic dioxa nucleus; the improvement which consists of using an inert N-alkyl pyrrolidone as solvent medium in said process.
8
Claims 3-20 vary solely in the recitation of other phosphorus-sulfur-containing catalysts in their preambles, which catalysts are those of the five Dunn and Proops patents. Claims 22, 28, and 34, which depend from claim 2, recite specific N-alkyl pyrrolidones, N-methylpyrrolidone, N-hexylpyrrolidone, and N-(2-ethylhexyl) pyrrolidone, respectively.
9
The claims on appeal were finally rejected by the examiner as "unpatentable over the claims" (emphasis supplied) of what were the then-copending applications which matured into the five patents,4 in view of the following patents:
10
Reppe et al. I5 2,806,040 Sept. 10, 1957
Reppe et al. II 2,809,976 Oct. 15, 1957
Lautenschlager
et al. 2,845,451 July 29, 1958
filed June 22, 1956 claiming priority on a German application filed
June 23, 1955
Reppe et al. IV
(German) 944,789 June 21, 1956
11
It is acknowledged that the assignee of the instant application, although not recorded, is the same as that of the five patents to Dunn and Proops, and that this fact was known to the examiner. Thus the rejection as cast above is one which has been classically termed "double patenting." The claims of an application are rejected over the claims of another application (or patent whose application was copending) which is commonly owned, even though there may be no identity of inventorship, when, as here, the claims so rejected fall within a penumbra of obviousness surrounding the other claims, as evidenced by other references cited of record. The latter practice of rejecting over claims in view of prior art has precedents in, for example, In re Ward, 236 F.2d 428, 43 CCPA 1007; In re Simmons, 312 F.2d 821, 50 CCPA 990; In re Eckel, 317 F.2d 401, 50 CCPA 1248.
12
It was the examiner's view that the secondary references of Reppe and Lautenschlager:
13
* * * clearly demonstrate that it is old to use N-alkylpyrrolidones as reaction solvents during synthesis of acrylate esters from acetylene, carbon monoxide and an alcohol. The claims of the cited copending applications are seen to differ from the claims of the instant application only with regard to the use of these solvents. * * *
14
That is, it was considered "old" to use the solvents in the reaction employing other catalysts. To the examiner the "claims of the instant application do not represent a patentable advance over the claimed process of the copending applications [now patents]." In the examiner's answer that position was restated as:
15
* * * The step of using conventional inert N-alkyl pyrrolidone as solvent medium in a process already patented to applicants is not seen to involve any further invention for which another patent may be granted.
16
Within the context of this case it is clear that both the Patent Office and appellants view the addition of a solvent to the patented catalyzed process as involving that category of "double patenting" involving the obviousness of that solvent addition. In re Eckel, supra; In re Robeson, 331 F.2d 610, 51 CCPA 1271, 1275. As the board stated:
17
* * * The sole issue in the present case is whether it would be obvious or unobvious to use an N-alkylpyrrolidone solvent in the processes recited in the claims of the Dunn et al. patents. * * *
18
Appellants devote a third of their brief under "Discussion" to the topic of "Invention claims are not obvious."
19
Appellants filed a Rule 131 affidavit in an effort to antedate the five Dunn and Proops patents from consideration. The purpose of a Rule 131 affidavit is to presumptively establish a date of invention earlier than the effective date of a domestic patent,6 where the patent "substantially shows or describes but does not claim the rejected invention." However a Rule 131 affidavit is clearly inappropriate to the facts here since the rejection was based on the claims rather than on the disclosure of the applications. In re Ward, 236 F.2d 428, 43 CCPA at 1012. In our view the only remaining issue is whether the appealed claims cover non-obvious improvements of the processes as claimed in the five patents, in view of the four patents to Reppe or Lautenschlager.
20
The patents to Reppe and Lautenschlager all relate to a process for preparing acrylic acid esters by reacting acetylene, carbon monoxide and a saturated aliphatic monohydroxy alcohol in the presence of a nickel halide catalyst. Each of those four patents points out that the reaction is known, and each is primarily concerned with the improvement of its catalyst. Reppe I adds an activator, the precise composition of which is not important for purposes of this appeal. Reppe I teaches the following concerning the use of solvents and the advantages thereof:
21
* * * Inert oxygen-containing organic solvents, as for example tetrahydrofurane and other ethers, esters or ketones, have already been used. The co-employment of such solvents is recommended especially because it renders possible an increase in the concentration of acetylene and carbon monoxide in the reaction liquid.
22
* * * * * *
23
* * * As solvents there may be mentioned in particular cyclic ethers, such as tetrahydrofurane and dioxane, and lower fatty ketones, such as acetone, which is preferably used in excess, and also in the case of the esters, also the corresponding alcohols. Other inert oxygen-containing acetylene-dissolving solvents which are preferably miscible with water, such as butyrolactone or N-methylpyrrolidone, are however also suitable in principle.
24
Reppe II forms a catalyst complex from a nickel halide and a carboxylic acid amide, specifically N-methyl pyrrolidone, for use in the production of acrylic acid esters. The complex may be preformed or formed in situ. Reppe II states:
25
* * * For the synthesis of the acrylic compounds, solutions of the complex compounds in the liquid initial materials can be used. It is, however, also possible to add during the synthesis of the acrylic compound solvents such as hydrocarbons, ether or carboxylic acid amides. Instead of using the separately manufactured complex compounds as catalysts, it is possible to make these compounds in situ by introducing the initial compounds, i. e., a nickel salt and a carboxylic acid amide, in the reaction vessel for the synthesis of the acrylic compounds. * * * If the complex catalysts are formed in situ, it is not necessary to use the initial materials in stoichiometrical proportions. The molar relation of nickel to amide may be between 1 to 2 and 1 to 10, preferably between 1 to 3 and 1 to 6. * * *
26
Lautenschlager shows the basic process using other specific catalyst complexes of the nickel halide-organic compound type. Concerning solvents for the reaction, Lautenschlager states:
27
* * * There may also be co-employed inert solvents, as for example tetrahydrofurane, acetone, dimethyl formamide, N-methyl-pyrrolidone or butyrolactone, which render possible an increase in the concentration of acetylene and carbon monoxide in the reaction liquid. * * *
28
Reppe IV, in the general acrylic acid ester process described above, uses a copper halide activator for the nickel halide catalyst component. Reppe IV states:
29
From the publications of W. Reppe (Liebig's Annalen der Chemie, vol. 582, 1953, p. 11) it is known that an attempt has already been made to increase the effect of nickel bromide by addition of a supplementary metal, e. g. iron or bismuth. These attempts have however been abandoned in favor of the use of organic complex compounds of phosphorus, arsenic or antimony with carbonyl-forming metals as catalysts.
30
It has now been found that the activity of halides of carbonyl-forming metals can be improved very effectively and the difficulties mentioned in connection with preparation of acrylic acid esters can be avoided without the need to incorporate elements such as phosphorus, arsenic or antimony in the catalyst by using an excess of an inert oxygen-containing organic solvent, i. e. in an amount more than equal by weight to that of the alcohol or phenol, with addition of a copper halide. The process has the further advantage that with use of substantially less catalyst a greater yield is obtained.
31
* * * * * *
32
As solvents, cylic ethers such as tetrahydrofuran and dioxane are suitable, as well as the aliphatic ketones of low molecular weight, e. g. acetone and methylethyl ketone. Basically also other oxygen-containing inert solvents such as butyrolactone or methyl pyrrolidone are usable for carrying out the process. [Emphasis ours.]
33
Additionally, appellants' brief notes that the examples of Reppe I, II, and Lautenschlager show the use of excess alcohol, one of the reactants, as a solvent medium.
34
About the five Dunn and Proops patents, appellants state in their brief:
35
The primary references relied upon are the following five patents to Dunn and Proops as the named inventors and patentees. In none of said Dunn and Proops patents is there any disclosure whatsoever of the use of an N-alkyl pyrrolidone as the solvent in the process, nor is there any claim covering its use.
36
It is also pointed out in the brief that the solvent used in each of the five patents is "excess alcohol, one of the reactants."
37
Appellants argue that none of the four patents to Reppe or Lautenschlager shows a catalyst complex which contains a phosphorus atom, in contrast to the catalysts of the claimed process. Reppe I, it is stated, specifically excludes phosphorus-containing compounds since it calls for a substituent element having an atomic number greater than that of phosphorus. It is also argued that Reppe IV "teaches away from the use of compounds containing the phosphorus atom."
38
We are not persuaded by those arguments since the patents to Reppe and Lautenschlager indicate that phosphorus-containing catalysts are old in the art. In discussing the prior art, Lautenschlager states "it is already known to use for this reaction as catalysts complex compounds of nickel which contain besides halogen, phosphonium, arsonium or stibonium compounds." [Emphasis ours.] The disclosure of Reppe I is substantially identical (understandably so since the two were co-workers). The disclosure of Reppe IV, above quoted, indicates that iron was attempted to be used as "supplementary" to a nickel bromide catalyst, but that such attempts have been "abandoned in favor of the use of organic complex compounds of phosphorus, * * *." We cannot take as "teaching away," the statements of Reppe IV that prior difficulties, specifically stated to be formation of side products and slowness of reaction, "can be avoided without the need to incorporate elements such as phosphorus * * *." Such a teaching of an alternative or equivalent method does not teach away from the use of solvents with a phosphorus compound. Finally, with regard to the use of phosphorus compounds as a catalyst component, each of the five Dunn and Proops patents, as well as the instant application, states that the prior art catalyzed the reaction "in the presence of a metal carbonyl, or other catalyst, for example, the complex triphenyl phosphine-nickel halide compounds * * *." [Emphasis supplied.]
39
We think the above quoted passages make it abundantly clear that both solvents, specifically N-methylpyrrolidone, and phosphorus-containing compounds as catalyst components, are conventionally used in the specific reaction of the instant process. Both the Dunn and Proops process as claimed and the Reppe I and IV patents are stated by appellants to use excess alcohol, one of the reactants, as a solvent, and the latter patents teach the equivalence of such a solvent with, specifically, N-methylpyrrolidone.
40
Appellants also contend that the claimed processes produce an unexpected improvement in the total yield as well as a reduction in the amount of polymer, an unwanted side-product when the monomer form is desired. Appellants rely primarily on a comparison of Example 1 with Example 1 a. Example 1 a is represented to differ from Example 1 by the omission of the N-methylpyrrolidone solvent. Omission of the solvent is stated to result in a reduction in yield from 93% to 20% and a monomer/polymer ratio drop from 7.5/1 to 5/1.
41
We cannot attach particular significance as showing non-obviousness to those examples since the procedures followed in the two examples do not have such correspondence (not considering the omission of the solvent) that the improved results can be traced, within a reasonable certainty, to the solvent alone. The nickel halide component of the catalysts is not the same in both, being nickel bromide in the solvent-containing example but nickel iodide in the non-solvent (lower yield) example. While the yield was lower even though the more reactive nickel iodide was used to offset the lack of solvent, we note that the reaction temperature was lowered and the time period shortened as well. The amounts of the two catalyst components are not the same in the two examples, and we have no information whether the relative proportions are the same or different. In the non-solvent example 925 grams of ethanol are used, while 230 grams are employed in the solvent-using example. We are not free to speculate whether that difference represents an excess of ethanol reactant to act as a solvent. There is no specific disclosure in the non-solvent example of the pressure nor of the amount of carbon monoxide or acetylene used.
42
While we do not intend to slight the alleged improvements, we do not feel it an unreasonable burden on appellants to require comparative examples relied on for non-obviousness to be truly comparative. The cause and effect sought to be proven is lost here in the welter of unfixed variables.
43
Nevertheless we think that some improvement in yield and monomer/polymer ratio is obtained, giving full faith to the statements of the disclosure. But we do not find such improvements unexpected if, indeed, they are traceable to the solvent, since the secondary references disclose that improvements are to be expected from the use of solvents. Reppe IV (quoted above) indicates improvements in the reaction, using their particular catalysts, are obtained by the use of solvents. The improvements noted by Reppe IV are: 1) an increased rate of reaction, which in a given period would be expected to result in a greater product yield, and 2) a reduction of side products, one of which is known to be the polymer form. Additionally, Reppe I, who uses N-methylpyrrolidone solvent, teaches us a reason for improved results:
44
* * * The co-employment of such solvents is recommended especially because it renders possible an increase in the concentration of acetylene and carbon monoxide [reactants] in the reaction liquid.
45
Appellants also point to Examples 8 and 9 as showing the unexpected results in yield and monomer/polymer ratio. They state that the solvent "was omitted as shown in example 8." This appears to be in error since both Examples 8 and 9 call for 500 mls N-methylpyrrolidone solvent; a check of the copy of the record certified to us from the Patent Office confirms that fact. What appears omitted from Example 8 is the phosphorus-containing component of the catalyst, and it is thus not related to the issue. Similarly, we find Examples 10-12 are no support for appellants' position. Those examples show the addition of a phosphorus-containing compound to the catalyst-complex of Reppe II gives improved results.
46
The teachings of the secondary references are more than merely adequate to show that the improved results shown by appellants are not clear and convincing proof of non-obviousness. Appellants have modified the processes of Dunn and Proops in an entirely conventional manner. By adding a conventional solvent they have followed the teachings of the art with not unexpected results. In re Lieser, 162 F.2d 224, 34 CCPA 1113. We affirm the rejection of claims 2-20 and 22.
47
We do not reach the same result with respect to claims 28 and 34, which call for two specific N-alkyl-pyrrolidones, the N-hexyl and N-(2-ethylhexyl) derivatives. Neither of these is disclosed by the prior art. The four patents to Reppe and Lautenschlager disclose, not the class of N-alkyl-pyrrolidones, but merely a single member, N-methylpyrrolidone. For ought the record shows, not only is the process using these two solvents novel, but there is no teaching in the art that they were ever considered equivalent to the N-methylpyrrolidone. The board erred in lumping the claims together without regard for the specific limitations of the claims as compared to the teachings of the art. We reverse the board as to claims 28 and 34.
The Motion to Remand
48
Appellants at oral argument on December 8, 1964 stated that a terminal disclaimer had been filed in the Patent Office on September 14, 1964. The solicitor had no information about the disclaimer and was of the view that it was not a proper issue in the case. The court directed each party to file a memorandum detailing the facts and to answer several questions: 1) Whether a terminal disclaimer in fact was filed, 2) if so, whether the disclaimer is properly before the court, and 3) what would be the legal effect of the disclaimer. Additionally, at argument, appellants made a motion to remand the case for consideration of the disclaimer, which motion was renewed in their memorandum. Appellants have correctly noted that remand would be unnecessary if "the court is of the opinion that the appealed claims are indeed patentable to applicant without it on the present record."
49
Subsequently, we received from the Patent Office a certified copy of the terminal disclaimer. Appellants' memorandum in response to the court's request notes that two disclaimers have been filed, the second after argument here. It merely differs from the first only in naming a specific date, December 27, 1977, the date of expiration of Dunn and Proops I and II patents, beyond which appellants' rights in any patent maturing from the instant application are disclaimed.
50
In response to our requests, it appears, first, that terminal disclaimers were indeed filed. Second, counsel disagree whether the disclaimer is before the court. We agree with the solicitor that it cannot be considered here since it is not part of the record in this appeal, nor was it passed on by the board.
51
Since the range of types of situations in which terminal disclaimers can be effective to overcome double patenting rejections based on obviousness is not yet settled, we think it advisable to remand this application for consideration of the disclaimers on that issue. The motion to remand will be granted.
52
The rejection of claims 2-20 and 22 is affirmed, and that of 28 and 34 is reversed, and the case remanded for consideration of claims 2-20 and 22 in view of the disclaimer.
53
Modified and remanded.
Notes:
1
The five patents are: Dunn and Proops (I), 2,966,510; Dunn and Proops (II), 2,966,511; Dunn and Proops (III), 2,967,882; Dunn and Proops (IV), 2,967,883; Dunn and Proops (V), 2,967,884
2
A type of claim to an improved combination in which known elements in the combination relationship are set forth in a "preamble" followed by a detailed statement of the improvement in an element or elements. The practice of using such claims arose from the decision in Ex parte Jepson, 1917 C.D. 62, 243 O.G. 525. See Ellis, Patent Claims, (1949) Secs. 14, 178, 179, 197
3
For example, claim 1 of U. S. Patent 2,966,511 (Dunn and Proops II) reads:
1
In the manufacture of an acrylic acid ester by the inter-action of acetylene with carbon monoxide and an alcohol at elevated temperature and under increased pressure, the improvement which comprises carrying out the reaction in the presence of a catalyst complex combination of a nickel halide and an inorganic phosphorus compound selected from the group consisting of the phosphorous suffides and the phosphorus selenides
The corresponding phosphorus compounds in the other patents are: Organic trithiophosphites (Dunn and Proops I), pentavalent phosphorus disulfides having a bis-(phosphorthio) disulfide radical (Dunn and Proops III), pentavalent organic phosphorus compounds having a thiono radical and a mercapto radical attached thereto and their nickel salts (Dunn and Proops IV), and pentavalent organic-thiono phosphorus compounds free of mercapto radicals (Dunn and Proops V).
4
See footnote 1, supra
5
Throughout the subsequent discussion of references we shall omit "et al."
6
Rule 131 by its terms is applicable where the application is rejected on "reference to a domestic patent," and also on "reference to a foreign patent or to a printed publication."
54
WORLEY, Chief Judge (concurring in part and dissenting in part), with whom ALMOND, J., joins.
55
I regret the necessity to repeat the views expressed in the dissenting opinion in In re Tanner, 52 CCPA ___, 343 F.2d 1018, 145 USPQ 345, that this court has no authority whatever, and the majority cites none, to direct the Patent Office to reopen prosecution to determine the effect, if any, of a terminal disclaimer. I again remind my colleagues that Congress has directed this court to restrict itself to "the evidence produced before the Patent Office," and to confine its decision "to the points set forth in the reasons of appeal." 35 U.S.C. § 144. Here, the proposed terminal disclaimer is not part of that evidence, is not in the record, is not mentioned in the reasons of appeal, and, as far as this court's jurisdiction is concerned, does not legally exist.
56
SMITH, Judge (dissenting in part).
57
While I agree with the majority opinion in its treatment of claims 28 and 34, I do not agree with its affirmance of the rejection of claims 2-20 and 22. There is no question in my mind as to the basic authority of this court to remand the case to the Patent Office for consideration of the terminal disclaimer issue, but the remand seems to me to be futile in view of the rationale of the majority decision as to claims 2-20 and 22
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329 N.W.2d 824 (1983)
TRUCK CRANE SERVICE CO., Respondent,
v.
BARR-NELSON, INC., Appellant.
No. C5-82-192.
Supreme Court of Minnesota.
February 18, 1983.
*825 Erich J. Russell, Minneapolis, for appellant.
Moriarty & Janzen and Robert E. Woods, Minneapolis, for respondent.
Considered and decided by the court en banc without oral argument.
AMDAHL, Chief Justice.
Defendant Barr-Nelson, Inc. appeals from a decision holding it liable under a payment guarantee agreement signed by an employee, Victor Barr, without its knowledge and against its express denial of liability. We reverse, holding that the employee lacked apparent authority sufficient to bind the principal as a matter of law.
The respondent Truck Crane Service Co. supplied cranes for several job sites where Barr-Nelson was the general contractor. Barr-Nelson ordered these services directly in some instances, and the amount due under these orders is undisputed. However, Barr-Nelson's subcontractor, Associated Builders, also ordered crane services for a Barr-Nelson project. Under the subcontract, Associated Builders was directly liable for these services, and was initially *826 billed for them. Associated Builders then disappeared or became insolvent in mid-performance of this contract and failed to pay for services rendered by Truck Crane at a Barr-Nelson job site.
Truck Crane then billed Barr-Nelson for the services ordered by Associated Builders, but Barr-Nelson denied liability and refused to pay. On November 29, 1979, George Barr, president of Barr-Nelson, memorialized his objections to these billings in a letter to Truck Crane, and asserted the liability of Associated Builders. Truck Crane's chief executive officer, who was aware of the letter from George Barr, nevertheless called the Barr-Nelson offices and attempted to negotiate a payment guarantee agreement with an employee, Victor Barr.
Victor, brother of George Barr, had been the secretary-treasurer of Barr-Nelson until June of 1978. He had once had the authority to sign checks, and his name had been printed on company checks with the title "Secretary-Treasurer" until this dispute arose in 1979. Truck Crane had received one of the checks bearing this imprint on October 18, 1979, but that check was signed by another Barr-Nelson officer, Dave Nelson. There was no evidence that any personnel at Truck Crane had noticed or remembered this check or its imprint prior to the time the guarantee was signed.
When Truck Crane reached him at Barr-Nelson's offices, Victor was there to help open mail and answer phones on a voluntary basis; George Barr was aware of this activity. Victor also worked on a paid basis as a construction laborer for the company.
During their telephone conversation, Victor Barr and the Truck Crane officer discussed the disputed invoices, and Victor admitted they were all related to Barr-Nelson projects and that Truck Crane "had the money coming." In response to Truck Crane's threat of legal action, Victor agreed to sign a guarantee agreement. He was not informed of George Barr's earlier letter to Truck Crane, nor did Truck Crane inquire as to Victor's authority to override the position taken by George Barr.
The sole issue raised in this appeal is whether Victor Barr was clothed with apparent authority sufficient to bind the principal, Barr-Nelson, Inc.
Apparent authority to contract for the principal consists of the following elements:
The principal must have held the agent out as having authority, or must have knowingly permitted the agent to act on its behalf; furthermore, the party dealing with the agent must have actual knowledge that the agent was held out by the principal as having such authority or had been permitted by the principal to act on its behalf; and the proof of the agent's apparent authority must be found in the conduct of the principal, not the agent.
Hockemeyer v. Pooler, 268 Minn. 551, 562, 130 N.W.2d 367, 375 (1964). See also Mooney v. Jones, 238 Minn. 1, 9, 54 N.W.2d 763, 767 (1952); 2 S. Williston, A Treatise on the Law of Contracts § 277A (3d ed.1959).
The trial court found that several factors reasonably interpreted by Truck Crane caused them to believe that Victor Barr was acting as Barr-Nelson's agent: Victor had been secretary-treasurer for Barr-Nelson and no steps were taken to inform Truck Crane that Victor no longer held that office; Victor's name appeared on company checks as secretary-treasurer; Victor was an employee who answered telephones and did other general office work for the company; and Barr-Nelson knew or should have known of, and acquiesced in such conduct by Victor.
These factors are insufficient as a matter of law to support a finding of apparent authority sufficient to bind the principal. They do not clearly establish an affirmative course of conduct by the principal that would constitute holding out or even knowingly permitting Victor to contract for the company. Even less do they establish reliance by the plaintiff on any such acts of the principal. The appearance of Victor's name and title on company checks would be the strongest factor in the plaintiff's case, *827 but for the fact that plaintiff failed to establish any awareness of or reliance on it at the time the agreement was reached. Apparent authority "exists only as to those third persons who learn of the manifestation from words or conduct for which the principal is responsible." Duluth Herald & News Tribune v. Plymouth Optical Co., 286 Minn. 495, 498-99, 176 N.W.2d 552, 555 (1970) (footnote omitted). Victor's presence in the company offices and conduct of opening mail and answering phones was similar to that of any clerical employee; when he stepped out of his permitted role and presumed to contract for the company, the law of agency became effective and shielded the principal from liability for acts of the employee of which the principal neither knew nor approved.[1]
Further, one who deals with an agent is put to a certain burden of reasonableness and diligence. "Every person who undertakes to deal with an agent is put on inquiry and must discover whether the agent has the authority to complete the proposed act." West Concord Conservation Club v. Chilson, 306 N.W.2d 893, 896 (Minn. 1981). We have previously held that as a matter of law, a general manager of a retail store was without apparent authority to contract for a new line of goods, where the store owner had first told the plaintiff that he did not desire to put in that line of goods. Barton-Parker Mfg. Co. v. Wilson, 96 Minn. 334, 104 N.W. 968 (1905). The fact that the plaintiff in this case had been notified in writing by Barr-Nelson's president that Barr-Nelson denied liability for these services put the plaintiff on inquiry as to the authority of any other Barr-Nelson employee to countermand such a position.
Because Truck Crane admitted some of the disputed billings were initially sent to Associated Builders rather than to Barr-Nelson, and because Barr-Nelson did admit liability for part of the amount claimed, the precise extent of Barr-Nelson's liability remains in dispute. We therefore reverse and remand for further proceedings consistent with this opinion.
Reversed and remanded.
NOTES
[1] The result has been different where members of the public were dealing over the telephone with employees of an insurance provider, for example, since recovery in those cases was premised on the fact that the public was invited to conduct such business over the telephone and had no reasonable basis for questioning the authority of the employee to speak for the company. See, e.g., Sauber v. Northland Insurance Co., 251 Minn. 237, 244-45, 87 N.W.2d 591, 596-97 (1958).
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FILED
NOT FOR PUBLICATION
AUG 04 2016
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, ) No. 14-50440
)
Plaintiff - Appellee, ) D.C. No. 2:13-cr-00819-PA-3
)
v. ) MEMORANDUM*
)
GERARD SMITH, AKA Gerard )
Robert Smith, )
)
Defendant - Appellant. )
)
UNITED STATES OF AMERICA, ) No. 14-50441
)
Plaintiff - Appellee, ) D.C. No. 2:13-cr-00819-PA-7
)
v. )
)
MARICELA LONG, )
)
Defendant - Appellant. )
)
UNITED STATES OF AMERICA, ) No. 14-50442
)
Plaintiff - Appellee, ) D.C. No. 2:13-cr-00819-PA-1
)
v. )
)
GREGORY THOMPSON, )
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
)
Defendant - Appellant. )
)
UNITED STATES OF AMERICA, ) No. 14-50446
)
Plaintiff - Appellee, ) D.C. No. 2:13-cr-00819-PA-4
)
v. )
)
MICKEY MANZO, AKA Mickey )
Shane Manzo, )
)
Defendant - Appellant. )
)
UNITED STATES OF AMERICA, ) No. 14-50449
)
Plaintiff - Appellee, ) D.C. No. 2:13-cr-00819-PA-6
)
v. )
)
SCOTT CRAIG, AKA Scott )
Alan Craig, )
)
Defendant - Appellant. )
)
UNITED STATES OF AMERICA, ) No. 14-50455
)
Plaintiff - Appellee, ) D.C. No. 2:13-cr-00819-PA-2
)
v. )
)
STEPHEN LEAVINS, )
)
Defendant - Appellant. )
)
UNITED STATES OF AMERICA, ) No. 14-50583
)
2
Plaintiff - Appellee, ) D.C. No. 2:13-cr-00819-PA-5
)
v. )
)
JAMES SEXTON, )
)
Defendant - Appellant. )
)
Appeal from the United States District Court
for the Central District of California
Percy Anderson, District Judge, Presiding
Argued and Submitted July 5, 2016
Pasadena, California
Before: FERNANDEZ, CLIFTON, and FRIEDLAND, Circuit Judges.
Gerard Smith, Maricela Long, Gregory Thompson, Mickey Manzo, Scott
Craig, Stephen Leavins (collectively, the “Joint Appellants”), and James Sexton
each appeal their convictions for obstruction of justice and conspiracy to obstruct
justice. See 18 U.S.C. §§ 371, 1503(a). Long and Craig also appeal their
convictions for making false statements. See id. § 1001(a)(2). Craig and Leavins
also appeal their sentences. The Joint Appellants and Sexton raise a number of
issues.1 We affirm.
1
In addition to the issues disposed of herein, they have raised several jury
instruction issues. We have addressed those in an opinion filed on the same date as
this memorandum disposition.
3
A) Evidentiary rulings
The Joint Appellants and Sexton challenge a number of evidentiary rulings
in their respective trials; all of their challenges fail.
(1) Challenges by the Joint Appellants
First, the district court did not abuse its discretion1 by excluding the
testimony of Paul Yoshinaga, Chief Legal Advisor to the LASD, on the grounds
that it was irrelevant and its probative value was outweighed by the risk of
confusing the jury. See Fed. R. Evid. 401–403; see also United States v. Haischer,
780 F.3d 1277, 1281 (9th Cir. 2015). While the evidence was somewhat relevant,2
it was minimally probative3 and risked misleading the jury with Yoshinaga’s legal
opinions.4 Moreover, any error in excluding the evidence was harmless5 and did
1
United States v. Wiggan, 700 F.3d 1204, 1210 (9th Cir. 2012); see also
United States v. Hinkson, 585 F.3d 1247, 1263 (9th Cir. 2009) (en banc).
2
See United States v. Vallejo, 237 F.3d 1008, 1015 (9th Cir.), amended by
246 F.3d 1150, 1150 (9th Cir. 2001); Bisno v. United States, 299 F.2d 711, 719
(9th Cir. 1961).
3
See Wiggan, 700 F.3d at 1213.
4
See id. at 1214 n.19.
5
See United States v. Moran, 493 F.3d 1002, 1014 (9th Cir. 2007) (per
curiam).
4
not constitute a constitutional violation6 in light of the marginal relevance of the
evidence and the jury instruction that the Joint Appellants could investigate
potential violations of California law by federal agents. Also, there was no
misconduct7 in the prosecution’s questioning of Leavins or its summary of his
testimony in closing argument, regardless of whether Leavins’s and Yoshinaga’s
recollections of their interactions may have differed to some extent.
Second, the district court did not abuse its discretion by excluding a video of
an inmate breaking out of his jail cell and attacking another inmate. The video’s
minimal probative value was substantially outweighed by the time that would be
wasted explaining the differences between the video and Brown’s situation,
including that the inmate victim was not held under 24-hour guard. See United
States v. Bussell, 414 F.3d 1048, 1059 (9th Cir. 2005); Fed. R. Evid. 403.
Third, the district court did not abuse its discretion by permitting Deputies
Michel and Courson to testify regarding certain incidents of inmate abuse. This
limited evidence was properly admitted to rebut the implication that the federal
investigation was unnecessary; it was not unfairly prejudicial because the jury was
already aware of the abuse allegations and was given a limiting instruction. See
6
See Haischer, 780 F.3d at 1284.
7
See United States v. Blueford, 312 F.3d 962, 968, 974 (9th Cir. 2002).
5
United States v. Hankey, 203 F.3d 1160, 1172–73 & n.11 (9th Cir. 2000).
Fourth, the district court did not abuse its discretion by refusing to admit a
video recording of a news interview with Sheriff Baca. The video was irrelevant8
because none of the Joint Appellants had seen it, and their claim that certain
witnesses relied on it is unsupported by the record. Moreover, the Joint Appellants
were not prevented from properly presenting other evidence of Sheriff Baca’s
attitude and orders they may have received.
Fifth, because the Joint Appellants never sought to admit two exhibits9 into
evidence, the district court did not abuse its discretion by failing to admit them.
No definitive ruling generally precluded evidence of Sheriff Baca’s demeanor or
attitude toward the FBI (in fact, other evidence on that topic was admitted) or
rendered superfluous a request to admit the exhibits. Cf. Dorn v. Burlington N.
Santa Fe R.R. Co., 397 F.3d 1183, 1189 (9th Cir. 2005).
Sixth, the district court did not abuse its discretion by not allowing the Joint
Appellants to cross examine Deputy Pearson about conversations he had after he
learned of the writ for Brown on the ground that it was beyond the scope of the
8
See Fed. R. Evid. 401, 402.
9
A letter from Sheriff Baca to United States Attorney Andre Birotte and a
memorandum summarizing an FBI interview with LASD Captain William Carey.
6
prosecution’s direct examination.10 Moreover, any error was harmless11 because
Pearson admitted that his memory was impaired, and undermining the reliability of
his recollection was the purpose of the Joint Appellants’ questions. Likewise, there
was no Confrontation Clause violation because the Joint Appellants were allowed
to explore the reliability of Pearson’s memory and the question about his
subsequent conversations was only marginally relevant. See Fowler v. Sacramento
Cty. Sheriff’s Dep’t, 421 F.3d 1027, 1036 (9th Cir. 2005); see also U.S. Const.
amend. VI.
Seventh, the district court did not abuse its discretion by refusing to allow
the Joint Appellants to renew their questioning of Deputy Martinez after they
already had an opportunity for re-cross examination. See Fed. R. Evid. 611(a); see
also United States v. Miller, 688 F.2d 652, 660–61 (9th Cir. 1982).
Eighth, assuming, without deciding, that the Joint Appellants should have
been permitted to ask AUSA Middleton leading questions as an adverse witness,12
10
See Fed. R. Evid. 611(b).
11
See Moran, 493 F.3d at 1014.
12
See Fed. R. Evid. 611(c)(2); United States v. Tsui, 646 F.2d 365, 368 (9th
Cir. 1981).
7
any error was harmless.13 The Joint Appellants do not claim that they were
prejudiced by the district court’s denial of Leavins’s counsel’s first request to lead
Middleton on a question regarding Sheriff Baca. Moreover, after Leavins’s
counsel’s later renewed request was denied, he did not attempt to ask Middleton
more questions. Therefore, there was no prejudice from the denial of the renewed
request to lead Middleton. See id.
Ninth, the Joint Appellants have failed to preserve the rest of their
evidentiary challenges for review by failing to explain how they constituted abuses
of discretion or materially affected the verdicts. See Greenwood v. FAA, 28 F.3d
971, 977 (9th Cir. 1994); see also United States v. Williamson, 439 F.3d 1125,
1138 (9th Cir. 2006).
Tenth, we reject the Joint Appellants’ argument that the district court’s
errors cumulatively require reversal. Most of its rulings were not erroneous, and as
to the particular rulings that we have assumed were erroneous, but nevertheless
harmless, we likewise conclude that their cumulative effect was harmless and not a
constitutional violation. See United States v. Fernandez, 388 F.3d 1199, 1256–57
(9th Cir. 2004), modified, 425 F.3d 1248, 1249 (9th Cir. 2005); cf. United States v.
Stever, 603 F.3d 747, 757 (9th Cir. 2010).
13
See Moran, 493 F.3d at 1014.
8
(2) Challenges by Craig, Long, and Leavins
We likewise reject Craig, Long, and Leavins’s argument that the district
court abused its discretion by excluding evidence of ruses used by the FBI and
LASD.14
First, the district court properly prevented the Joint Appellants from
questioning FBI agents about their use of ruses on the grounds that it was
irrelevant, would waste time, and would confuse the jury. See Fed. R. Evid. 401,
403. To the extent that evidence of FBI practices was marginally relevant to what
the Joint Appellants could do or did, it was still properly excluded because that
slight relevance was outweighed by its tendency to misdirect the jury toward the
logical fallacy that if the FBI could sometimes use ruses, it was legitimate for
LASD to do so here.
Second, the district court did not exclude all evidence regarding LASD’s use
of ruses; in fact, Craig testified about that topic. We see no abuse of discretion,
under the circumstances, in the district court’s sustaining objections to six
individual questions about that topic asked of four witnesses. Even if there were
error, because Craig and Long failed to explain the nature of the alleged errors in
14
Because we determine that the district court did not err in excluding these
categories of evidence, we also reject Leavins’s claim that those purported errors
support a finding of cumulative error. See Fernandez, 388 F.3d at 1256.
9
their opening brief, we would decline to reverse. See Greenwood, 28 F.3d at 977.
(3) Limits on Craig’s testimony
Craig claims that the district court violated his Sixth Amendment right to
testify on his own behalf regarding his intent and the danger of cell phones in
custodial settings,15 but the court did not impose a per se bar to the admission of
either type of evidence.16 With respect to intent, Craig was allowed to testify,
although the district court appropriately refused to permit his attorney to use
improper questions. See Chambers v. Mississippi, 410 U.S. 284, 302, 93 S. Ct.
1038, 1049, 35 L. Ed. 2d 297 (1973); United States v. Gallagher, 99 F.3d 329, 332
(9th Cir. 1996). The rulings were not erroneous and did not constitute
constitutional error, plain or otherwise. See Stever, 603 F.3d at 755–56 & n.3; see
also Fed. R. Crim. P. 52(b); Henderson v. United States, __ U.S. __, __, 133 S. Ct.
1121, 1126–27, 185 L. Ed. 2d 85 (2013). With respect to the dangers of cell
phones in the jail, the record does not support Craig’s claim that he was precluded
from offering that kind of evidence, through his testimony or otherwise. And even
if the court’s ruling prevented him from testifying on that topic, it would not be a
15
See Rock v. Arkansas, 483 U.S. 44, 52, 107 S. Ct. 2704, 2709, 97 L. Ed. 2d
37 (1987).
16
Cf. United States v. Pineda-Doval, 614 F.3d 1019, 1032–33 (9th Cir.
2010).
10
constitutional violation. See Stever, 603 F.3d at 756. The excluded evidence was
not extensive or broad, and was not the only evidence presented on the topic. Cf.
id.; Greene v. Lambert, 288 F.3d 1081, 1091–92 (9th Cir. 2002).
(4) Challenges by Sexton
First, we reject Sexton’s claim that the district court erred by failing to
suppress all of his grand jury testimony because the United States Attorney’s
Office purportedly violated its internal procedures by failing to warn him that he
was a target of the investigation before he testified. As a factual matter, the district
court’s finding that the Government did not consider him to be a target at the time
of his grand jury testimony is supported by the record. See United States v.
Todhunter, 297 F.3d 886, 889 (9th Cir. 2002). Even assuming that he was a target
at that time, there was no due process violation because Sexton was advised of his
Fifth Amendment rights. See United States v. Goodwin, 57 F.3d 815, 818–19 (9th
Cir. 1995); see also United States v. Washington, 431 U.S. 181, 189, 97 S. Ct.
1814, 1820, 52 L. Ed. 2d 238 (1977). We decline Sexton’s request to exercise any
supervisory authority we have to impose sanctions on the Government by
suppressing his testimony. See United States v. Wilson, 614 F.2d 1224, 1227 (9th
Cir. 1980); see also United States v. Williams, 504 U.S. 36, 46, 112 S. Ct. 1735,
1741, 118 L. Ed. 2d 352 (1992); Goodwin, 57 F.3d at 818.
11
Second, the district court did not abuse its discretion by denying Sexton’s
request to require the Government to introduce portions of his grand jury testimony
in addition to those excerpts that the Government offered. See Fed. R. Evid. 106.
Sexton never identified how the excerpts the Government sought to introduce were
“misleadingly-tailored snippet[s]” taken out of context;15 instead he claimed that
the Government excerpts were misleading as a whole. Apparently that was
because the Government excluded several somewhat-exculpatory statements. But
those statements were inadmissible hearsay16 and Rule 106 did not require their
admission.17
Third, the district court did not abuse its discretion by prohibiting Sexton
from eliciting testimony from FBI Agent Narro that he understood that the writ for
Brown’s testimony had been withdrawn.18 Contrary to Sexton’s claims, the
15
United States v. Collicott, 92 F.3d 973, 983 (9th Cir. 1996); see also
United States v. Vallejos, 742 F.3d 902, 905 (9th Cir. 2014).
16
See United States v. Ortega, 203 F.3d 675, 682 (9th Cir. 2000); cf. United
States v. Swacker, 628 F.2d 1250, 1253 & n.3 (9th Cir. 1980). We reject Sexton’s
conclusory statement in his reply brief that the statements were not hearsay
pursuant to Federal Rule of Evidence 803(3). Cf. United States v. Faust, 850 F.2d
575, 585–86 (9th Cir. 1988).
17
Collicott, 92 F.3d at 983
18
In fact, AUSA Middleton had decided not to pursue execution of the writ at
that time, but never sought to withdraw it or decided that LASD need not comply
(continued...)
12
evidence was not that the writ had, in fact, been withdrawn; instead, it was
evidence that Narro had that understanding. Narro’s impressions were irrelevant in
the absence of evidence that they had been communicated to Sexton or others at
LASD. And even assuming that Narro’s understanding was some evidence that the
writ had actually been withdrawn, that did not tend to show that the grand jury had
no further interest in Brown. Moreover, the fact remains that Sexton’s obstructive
actions commenced before the so-called withdrawal. It was irrelevant whether the
writ was withdrawn after Sexton had committed those acts. See United States v.
Rasheed, 663 F.2d 843, 853 (9th Cir. 1981); see also United States v. Aguilar, 515
U.S. 593, 602, 115 S. Ct. 2357, 2363, 132 L. Ed. 2d 520 (1995); United States v.
Ladum, 141 F.3d 1328, 1339 (9th Cir. 1998).
B) Insufficiency of the evidence
(1) False statement convictions
Craig and Long claim that there was insufficient evidence to show that their
respective statements to Agents Marx and Narro were material to the FBI as
required for their false statement convictions. See 18 U.S.C. § 1001(a)(2).
18
(...continued)
with it.
13
Reviewing the evidence in the light most favorable to the verdict,19 a rational juror
could find that the statements could have affected the FBI’s investigation for the
grand jury20 by intimidating Agent Marx and her colleagues. And although it was
not required for the Government to prove this count, there was evidence that the
statements had that intended effect because the FBI postponed returning to the jail
to interview inmates and gather information as a result. The Government was not
required to show that the statements caused the entire investigation for the grand
jury to shut down. See King, 735 F.3d at 1108.
(2) Long’s obstruction of justice conviction
Likewise, we reject Long’s claim that the evidence was insufficient to prove
that her actions were material to the grand jury investigation, as required for her
obstruction of justice conviction. See 18 U.S.C. § 1503; United States v. Thomas,
612 F.3d 1107, 1129 (9th Cir. 2010). There was sufficient evidence that Long
endeavored to obstruct justice through her efforts directed at the FBI agents and
through her efforts to convince witnesses not to cooperate with the federal
investigation. Those efforts would “have the natural and probable effect of
19
See United States v. Nevils, 598 F.3d 1158, 1161 (9th Cir. 2010) (en banc).
20
See United States v. Stewart, 420 F.3d 1007, 1019 (9th Cir. 2005); United
States v. King, 735 F.3d 1098, 1107–08 (9th Cir. 2013).
14
interfering” with the grand jury investigation. Aguilar, 515 U.S. at 599, 115 S. Ct.
at 2362 (internal quotation marks omitted) (quoting United States v. Wood, 6 F.3d
692, 695 (10th Cir. 1993)); see also Thomas, 612 F.3d at 1129. We therefore
affirm her obstruction of justice conviction.
Long’s argument is largely premised on her assertion that there was no
evidence that she knew of the writ for Brown, or that she knew that Deputies
Michel or Courson were potential grand jury witnesses. But there was sufficient
circumstantial evidence from which the jury could rationally infer Long’s
knowledge. See United States v. Bennett, 621 F.3d 1131, 1139 (9th Cir. 2010); see
also Nevils, 598 F.3d at 1161.
In light of those justifiable inferences, there was ample evidence from which
the jury could also rationally infer that Long’s actions would have the natural and
probable effect of interfering with the grand jury investigation. In fact, the actions
by her and others appear to have been successful because Brown ultimately assured
Long and others that he would not testify for the FBI. Similarly, the jury could
have inferred that Long’s presence at, and statements she made during, the
interviews of Deputies Courson and Michel were designed to pressure them not to
cooperate with the federal investigation. We therefore reject Long’s claim that
there was insufficient evidence that her endeavors to obstruct justice were material
15
to the grand jury.21
(3) Long’s conspiracy conviction
Long argues that the evidence was insufficient to sustain her conviction for
conspiracy to obstruct justice. We disagree. See United States v. Hart, 963 F.2d
1278, 1282 (9th Cir. 1992); see also United States v. Mincoff, 574 F.3d 1186, 1198
(9th Cir. 2009); United States v. Hernandez-Orellana, 539 F.3d 994, 1007 (9th Cir.
2008).
There was a great deal of evidence that Long knowingly participated22 in the
conspiracy and acted to further its objectives.23 For example, she went to the jail
where Brown was hidden in order to interfere with the grand jury investigation by
pressuring him. She was not merely physically present while her co-conspirators
committed crimes,24 but actively participated to further the conspiracy’s obstructive
21
Long has waived the argument that there was insufficient evidence the FBI
was acting as an “arm of the grand jury” by raising it too late. See United States v.
Romm, 455 F.3d 990, 997 (9th Cir. 2006). In any event, the evidence here was
sufficient to establish that the FBI was operating on behalf of the grand jury. See
Hopper, 177 F.3d at 830; cf. Aguilar, 515 U.S. at 600, 115 S. Ct. at 2362.
22
United States v. Esquivel-Ortega, 484 F.3d 1221, 1228 (9th Cir. 2007); see
also United States v. Herrera-Gonzalez, 263 F.3d 1092, 1095 (9th Cir. 2001);
United States v. Wright, 215 F.3d 1020, 1028 (9th Cir. 2000).
23
United States v. Esparza, 876 F.2d 1390, 1392 (9th Cir. 1989).
24
Cf. Herrera-Gonzalez, 263 F.3d at 1095.
16
purposes.25 Even if she did not know precisely what each of her co-conspirators
was doing, that does not undermine her connection to the conspiracy. See
Herrera-Gonzalez, 263 F.3d at 1095.
C) Fair notice
The Joint Appellants and Sexton all claim that 18 U.S.C. § 1503(a) did not
provide fair notice because it is vague, was novelly interpreted, and should have
been interpreted in accordance with the rule of lenity. See United States v. Lanier,
520 U.S. 259, 266, 117 S. Ct. 1219, 1225, 137 L. Ed. 2d 432 (1997); Webster v.
Woodford, 369 F.3d 1062, 1069 (9th Cir. 2004); see also Gollehon v. Mahoney,
626 F.3d 1019, 1023 (9th Cir. 2010). Appellants’ arguments are largely premised
on their assertion that they were prosecuted and convicted for innocuous conduct—
investigating the FBI or following orders. But they were prosecuted and convicted
for obstructing a grand jury investigation; the fact that the jury did not believe their
mens rea defenses “does not make the statute . . . constitutionally infirm.” United
States v. Lee, 183 F.3d 1029, 1033 (9th Cir. 1999).
Cases addressing § 1503’s potential vagueness in other factual
25
Cf. Esparza, 876 F.2d at 1392–93.
17
circumstances26 do not show that it is vague as applied to their conduct.27 Nor was
it novel to apply the obstruction statute to what they did: that is, to conduct
intended to obstruct justice. We also reject their request to transplant the concept
of qualified immunity from the civil to the criminal sphere. See Lanier, 520 U.S.
at 270, 117 S. Ct. at 1227; see also United States v. Gillock, 445 U.S. 360, 372–73,
100 S. Ct. 1185, 1193, 63 L. Ed. 2d 454 (1980).28 The obstruction statute provided
the Joint Appellants and Sexton with ample fair notice that their obstructive
conduct could give rise to criminal penalties.
D) Dismissal of a juror
We reject the Joint Appellants’ argument that the district court violated their
Sixth Amendment rights by dismissing Juror Five after deliberations had begun.
See United States v. Christensen, Nos. 08-50531 et al., 2015 WL 11120665, at
*31–33 (9th Cir. July 8, 2016). The district court did not abuse its discretion29 by
26
See, e.g., United States v. Bonds, 784 F.3d 582, 584 (9th Cir. 2015) (en
banc) (Kozinski, J., concurring).
27
See United States v. Jae Gab Kim, 449 F.3d 933, 942 (9th Cir. 2006)
28
Moreover, it was certainly clearly established that one could not
intentionally obstruct justice. See Aguilar, 515 U.S. at 598–99, 115 S. Ct. at
2361–62.
29
United States v. Symington, 195 F.3d 1080, 1085 (9th Cir. 1999).
18
dismissing the juror for good cause.30
The record supports the district court’s decision to dismiss Juror Five, who
revealed, over the course of three colloquies with the district court, that her
emotional state31 prevented her from being able to deliberate,32 and the district
court noted that her demeanor underscored the problems that are apparent in the
written record. The district court therefore was not required to credit her ultimate
(and somewhat grudging) statement that she could deliberate. See Christensen,
2015 WL 11120665, at *36–37; see also Beard, 161 F.3d at 1194. The Joint
Appellants’ speculation that the juror may have asked to be excused because of
conflicts with other jurors is belied by the record; indeed, the juror flatly denied
that her concerns had anything to do with the other jurors, and she never referred to
her views of the case or the guilt or innocence of the Joint Appellants. Cf.
Symington, 195 F.3d at 1084, 1088. The district court did not abuse its discretion
in dismissing the juror on account of her inability to deliberate. See Christensen,
2015 WL 11120665, at *31.
30
Christensen, 2015 WL 11120665, at *31; see also Fed. R. Crim. P.
23(b)(3).
31
United States v. Beard, 161 F.3d 1190, 1193–94 (9th Cir. 1998)
32
Symington, 195 F.3d at 1085
19
E) Sentencing
The district court increased Craig’s base offense level by three points
because he was a manager or supervisor and increased Leavins’s base offense level
by four points because he was an organizer or leader. See USSG § 3B1.1(a)–(b)
(2013);33 see also United States v. Whitney, 673 F.3d 965, 975 (9th Cir. 2012).
Craig and Leavins each argue that the district court procedurally erred by
miscalculating their Sentencing Guidelines ranges. See United States v. Carty, 520
F.3d 984, 993 (9th Cir. 2008) (en banc); see also Molina-Martinez v. United States,
__ U.S. __, __, 136 S. Ct. 1338, 1345–46, 194 L. Ed. 2d 444 (2016). The district
court did not commit clear error when it applied the enhancements to Craig and
Leavins. See United States v. Rivera, 527 F.3d 891, 908 (9th Cir. 2008); United
States v. Jordan, 291 F.3d 1091, 1097 (9th Cir. 2002); see also United States v.
Rosas, 615 F.3d 1058, 1066 (9th Cir. 2010).
There was sufficient evidence that Craig was a manager of criminal activity,
not merely innocuous activity. See USSG § 3B1.1(b); cf. Whitney, 673 F.3d at
975. The enhancement was not merely based on Craig’s role as an LASD
supervisor, but on his role as a supervisor in the group committing the charged
33
All references to the Sentencing Guidelines are to the Nov. 1, 2013,
version.
20
offenses. See USSG § 3B1.1, comment. (n.2). He directed Long and other LASD
personnel in interviewing Brown and other witnesses, he ordered the surveillance
of FBI agents, and he advised Long as she lied to Agent Narro. That Craig has a
contrary view of the evidence does not warrant reversal of “the district court’s . . .
reasonable interpretation of the facts.” See United States v. Awad, 371 F.3d 583,
592 (9th Cir. 2004). Moreover, the fact that Craig’s behavior may not have
qualified for the four-point enhancement does nothing to undermine the application
of the three-point enhancement. See USSG § 3B1.1, comment. (n.4).
We reject Leavins’s argument about his sentence for similar reasons. There
was ample evidence showing Leavins’s decision-making authority in the criminal
conspiracy and justifying the application of the four-point enhancement. His own
grand jury testimony indicated that he made the decision to move Brown to another
jail, and the district court was not required to credit his exculpatory explanation for
why he did so. See Awad, 371 F.3d at 592. Leavins directed the actions of other
conspirators, such as by telling Craig and Long to confront Agent Marx. Cf.
Whitney, 673 F.3d at 975. Also, while not controlling, other conspirators did refer
to him as their superior. That Leavins may also have received orders from his own
superiors does not undermine his leadership role for purposes of the enhancement.
See United States v. Barnes, 993 F.2d 680, 685 (9th Cir. 1993); see also USSG
21
§3B1.1, comment. (n.4). The district court did not clearly err by applying the four-
point enhancement to Leavins’s sentence.34
AFFIRMED.
34
Because we affirm the convictions and sentences, we need not and do not
consider the Joint Appellants’ argument that these cases should be reassigned to a
different district court judge on remand.
22
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} |
IN THE COURT OF APPEALS OF THE STATE OF IDAHO
Docket No. 41055
STATE OF IDAHO, ) 2014 Unpublished Opinion No. 321
)
Plaintiff-Respondent, ) Filed: January 13, 2014
)
v. ) Stephen W. Kenyon, Clerk
)
KEITH WILLIAM BIZAUSKAS, ) THIS IS AN UNPUBLISHED
) OPINION AND SHALL NOT
Defendant-Appellant. ) BE CITED AS AUTHORITY
)
Appeal from the District Court of the Seventh Judicial District, State of Idaho,
Bonneville County. Hon. Dane H. Watkins, Jr., District Judge.
Judgment of conviction and concurrent unified sentences of thirty years, with a
minimum period of confinement of fifteen years, for lewd conduct with a child;
twenty years, with a minimum period of confinement of ten years, for forcible
sexual penetration by use of a foreign object; and ten years, with a minimum
period of confinement of five years, for sexual exploitation of a child, affirmed.
Sara B. Thomas, State Appellate Public Defender; Ben P. McGreevy, Deputy
Appellate Public Defender, Boise, for appellant.
Hon. Lawrence G. Wasden, Attorney General; Kenneth K. Jorgensen, Deputy
Attorney General, Boise, for respondent.
________________________________________________
Before LANSING, Judge; GRATTON, Judge;
and MELANSON, Judge
PER CURIAM
Keith William Bizauskas pled guilty to lewd conduct with a child under sixteen, I.C. §
18-1508; forcible sexual penetration by use of a foreign object, I.C. § 18-6608; and sexual
exploitation of a child, I.C. § 18-1507A. In exchange for his guilty pleas, additional charges
were dismissed. The district court sentenced Bizauskas to a unified term of thirty years, with a
minimum period of confinement of fifteen years, for lewd conduct with a child; a concurrent
unified term of twenty years, with a minimum period of confinement of ten years, for forcible
sexual penetration by use of a foreign object; and a concurrent unified term of ten years, with a
1
minimum period of confinement of five years, for sexual exploitation of a child. Bizauskas filed
an I.C.R. 35 motion for reduction of his sentences, which the district court denied. Bizauskas
appeals, asserting that his sentences are excessive.
Sentencing is a matter for the trial court’s discretion. Both our standard of review and the
factors to be considered in evaluating the reasonableness of the sentence are well established and
need not be repeated here. See State v. Hernandez, 121 Idaho 114, 117-18, 822 P.2d 1011, 1014-
15 (Ct. App. 1991); State v. Lopez, 106 Idaho 447, 449-51, 680 P.2d 869, 871-73 (Ct. App.
1984); State v. Toohill, 103 Idaho 565, 568, 650 P.2d 707, 710 (Ct. App. 1982). When reviewing
the length of a sentence, we consider the defendant’s entire sentence. State v. Oliver, 144 Idaho
722, 726, 170 P.3d 387, 391 (2007). Applying these standards, and having reviewed the record
in this case, we cannot say that the district court abused its discretion.
Therefore, Bizauskas’s judgment of conviction and sentences are affirmed.
2
| {
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} |
In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 13‐1200
KYLL LAVALAIS,
Plaintiff‐Appellant,
v.
VILLAGE OF MELROSE PARK, et al.,
Defendants‐Appellees.
____________________
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 1:12‐cv‐06921 — Robert W. Gettleman, Judge.
____________________
ARGUED SEPTEMBER 24, 2013 — DECIDED OCTOBER 24, 2013
____________________
Before POSNER, TINDER, and HAMILTON, Circuit Judges.
TINDER, Circuit Judge. Kyll Lavalais, a sergeant with the
Village of Melrose Park Police Department, sued his em‐
ployer, the Village of Melrose Park, and the Chief of Police,
Sam Pitassi, under Title VII and 42 U.S.C. § 1983, alleging
race discrimination and retaliation. The district court grant‐
ed the defendants’ motion to dismiss for failure to state a
claim and Lavalais appealed. For the reasons that follow, we
2 No. 13‐1200
vacate the dismissal of the race discrimination claims, affirm
the dismissal of the retaliation claims, and remand.
I. Background
Plaintiff Lavalais is employed by the Village of Melrose
Park as a police officer. He is the only black officer in the po‐
lice department, which has approximately seventy‐five offic‐
ers. He has been employed as a police officer with the Vil‐
lage for more than twenty years. In 2010, Lavalais filed a
charge with the Equal Employment Opportunity Commis‐
sion (EEOC), alleging race discrimination. He filed a second
charge in January 2011, alleging that he was disciplined for
filing his first EEOC charge and discriminated against be‐
cause of his race.
In early February 2011, Lavalais was promoted to ser‐
geant and placed on the midnight shift. Over a year later, on
April 2, 2012, he requested a change of assignment from the
midnight shift, expressing an interest in any supervisory as‐
signment other than the midnight shift. Chief Pitassi denied
his request. In July 2012, Lavalais filed a charge of discrimi‐
nation with the EEOC, alleging that the Village “(and its Po‐
lice Department leaders)” treated similarly situated officers
not in the protected class more favorably “as to policies and
re‐assignment” and that he had “been placed on the mid‐
night tour indefinitely” because of his race. A month later,
the EEOC issued a right‐to‐sue letter.
Lavalais sued the Village and Chief Pitassi in federal dis‐
trict court alleging employment discrimination based on his
race and in retaliation for filing an EEOC charge. The de‐
fendants moved to dismiss under Rule 12(b)(6) for failure to
state a claim, and Lavalais filed an amended complaint un‐
No. 13‐1200 3
der Title VII and § 1983, alleging race discrimination, retalia‐
tion, and violations of the Equal Protection Clause. Count I
alleges that Lavalais was passed over for assignment to the
day or evening tour, was denied the opportunity to work a
tour of duty other than the midnight tour, and was subjected
to what is in effect a demotion in violation of Title VII. La‐
valais alleges that the defendants overlooked his qualifica‐
tions and seniority because of his race and in retaliation for
his complaints to the EEOC. Count II alleges that in 2010 La‐
valais complained to the EEOC that the defendants were
discriminating against him because of his race and that in
retaliation for his protected speech, the defendants assigned
him to midnight duty and constructively stripped him of his
authority as a sergeant. Count III alleges a violation of the
Equal Protection Clause under § 1983, specifically that Chief
Pitassi singled Lavalais out for less favorable treatment be‐
cause of his race, granting him limited authority as a ser‐
geant, passing over him in favor of a less qualified person
for another tour, diminishing his job responsibilities, and re‐
taliating against him. Count IV alleges a municipal liability
race discrimination claim against the Village. The defendants
moved under Rule 12(b)(6) to dismiss all claims, and the dis‐
trict court granted their motion. Lavalais appealed.
II. Discussion
Lavalais contends that the district court erred in dismiss‐
ing his complaint. We review de novo a Rule 12(b)(6) dismis‐
sal for failure to state a claim. Alam v. Miller Brewing Co., 709
F.3d 662, 665 (7th Cir. 2013). A “complaint must contain al‐
legations that ‘state a claim to relief that is plausible on its
face.’” Id. (quoting Ashcroft v. Iqbal, 556 U.S. 662 (2009)). We
accept all well‐pleaded factual allegations as true and view
4 No. 13‐1200
them in the light most favorable to the plaintiff. Luevano v.
Wal‐Mart Stores, Inc., 722 F.3d 1014, 1027 (7th Cir. 2013). A
plaintiff “must plead some facts that suggest a right to relief
that is beyond the ‘speculative level.’” Atkins v. City of Chica‐
go, 631 F.3d 823, 832 (7th Cir. 2011). This means that “the
complaint must contain ‘allegations plausibly suggesting
(not merely consistent with)’ an entitlement to relief.” Alam,
709 F.3d at 666 (quoting Bell Atl. Corp. v. Twombly, 550 U.S.
544, 557 (2007)).
To the extent Lavalais pursues Title VII claims based on
his initial placement on the midnight shift, such claims are
time‐barred. As applicable here, an EEOC charge “shall be
filed … within three hundred days after the alleged unlaw‐
ful employment practice occurred.” 42 U.S.C. § 2000e‐5(e)(1).
If a plaintiff fails to file a timely charge concerning a discrete
act of discriminatory conduct, his claim is time‐barred. Roney
v. Ill. Dep’t of Transp., 474 F.3d 455, 460 (7th Cir. 2007). La‐
valais was placed on the midnight shift on February 5, 2011.
He did not file his EEOC charge complaining about that
placement until July 18, 2012—more than 300 days later.
Thus, his initial placement on the midnight shift cannot be
the basis of his Title VII claims.
As for the Title VII retaliation claim, the district court
dismissed it on procedural grounds, finding it barred be‐
cause it varied from the 2012 EEOC charge. Lavalais has not
challenged this ground for dismissal and thus has waived
any argument that the court erred. See Logan v. Wilkins, 644
F.3d 577, 583 (7th Cir. 2011).
Turning to the Title VII race discrimination claim, the de‐
fendants first argue that in amending his complaint, Lavalais
dropped his denial of transfer claim and proceeded only on
No. 13‐1200 5
the claim regarding his initial placement on the midnight
shift. A complaint must allege “’some specific facts’ to sup‐
port the legal claims asserted.” McCauley v. City of Chicago,
671 F.3d 611, 616 (7th Cir. 2011) (citation omitted). “The de‐
gree of specificity required … rises with the complexity of
the claim.” Id. at 616–17; see also Swanson v. Citibank, N.A.,
614 F.3d 400, 405 (7th Cir. 2010) (“A more complex case …
will require more detail … .”). “[A] complaint alleging [race]
discrimination need only aver that the employer instituted a
(specified) adverse employment action against the plaintiff
on the basis of [his race].” Luevano, 722 F.3d at 1028 (quoting
Tamayo v. Blagojevich, 526 F.3d 1074, 1084 (7th Cir. 2008)).
The original complaint specifically alleged that Lavalais
requested Chief Pitassi to allow him to work a shift other
than the midnight shift and that Pitassi denied his request.
Compl. ¶ 18. These allegations are omitted from the amend‐
ed complaint. However, the amended complaint does allege
that Lavalais was being forced “to work midnights indefi‐
nitely,” which “causes him to be virtually powerless,” First
Am. Compl. ¶ 21; that assignment to the midnight shift
comes with significantly diminished job responsibilities, id. ¶
19(c), and “severely restricted” duties—“it is as if he is not a
sergeant,” id. ¶ 22; that the defendants have compromised
his “right [as a sergeant] to make major sergeant level and
law enforcement decisions in his role as a sergeant” and that
“this conduct … is continuing,” id. ¶ 30 (alteration in origi‐
nal). These allegations sufficiently suggest a denial of trans‐
fer claim. And such a claim is not inconsistent with any oth‐
er allegations of the amended complaint. “A party who ap‐
peals from a Rule 12(b)(6) dismissal may elaborate on her
allegations so long as the elaborations are consistent with the
6 No. 13‐1200
pleading.” Wigod v. Wells Fargo Bank, N.A., 673 F.3d 547, 555
(7th Cir. 2012).
Furthermore, in responding to the motion to dismiss the
amended complaint, Lavalais clearly maintained a denial of
transfer claim. For example, in arguing that his claims were
not untimely, he asserted that “[t]he date of his promotion to
sergeant is not significant. What is significant is that … [his]
written request to Chief Pitassi, for a transfer, was denied.”
Pl.’s Resp. Opp’n Defs’ Mot. Dismiss 1‐2. Although La‐
valais’s appellate brief seems to emphasize his initial as‐
signment to the midnight shift, he advances arguments
about being “disallow[ed] a transfer from the midnight
tour,” Appellant’s Br. 14, which are sufficient to maintain the
denial of transfer claim.
The defendants also argue that the district court erred in
finding that the denial of transfer claim was within the scope
of the 2012 EEOC charge. Generally, “a Title VII plaintiff
cannot bring claims in a lawsuit that were not included in
her EEOC charge.” Cheek v. W. & S. Life Ins. Co., 31 F.3d 497,
500 (7th Cir. 1994). However, “a plaintiff can still bring
[claims not included in the EEOC charge] if they are ‘like or
reasonably related to the allegations of the [EEOC] charge
and growing out of such allegations.’” Moore v. Vital Prods.,
Inc. 641 F.3d 253, 256–57 (7th Cir. 2011) (quotingJenkins v.
Blue Cross Mut. Hosp. Ins., Inc., 538 F.2d 164, 167 (7th Cir.
1976) (en banc)). “To be ‘like or reasonably related,’ the rele‐
vant claim and the EEOC charge ‘must, at minimum, de‐
scribe the same conduct and implicate the same individu‐
als.’” Id. at 257 (quoting Cheek, 31 F.3d at 501).
The 2012 EEOC charge asserts that the Village and the
leaders of the police department treated similarly situated
No. 13‐1200 7
officers not in the protected class more favorably “as to poli‐
cies and re‐assignment” and that Lavalais had “been placed
on the midnight tour indefinitely” because of his race. The
amended complaint alleges that the Village and Chief have
treated Lavalais less favorably than other officers because of
his race and that he was denied the opportunity to work on
a tour other than the midnight tour. The EEOC charge and
amended complaint describe the same conduct and impli‐
cate the same individuals: Lavalais’s indefinite assignment
to the midnight tour, which in this case is another way of
saying a denial of a transfer, by the Village and police de‐
partment leaders, which surely includes the Chief of Police.
And the alleged denial of a transfer could grow or reasona‐
bly be expected to grow out of the allegations in the EEOC
charge. Thus, Lavalais can pursue his denial of transfer
claim.
That brings us to the issue of whether the denial of trans‐
fer rises to a materially adverse employment action. “[A]
purely lateral transfer, that is, a transfer that does not involve
a demotion in form or substance, cannot rise to the level of a
materially adverse employment action.” Williams v. Bristol‐
Myers Squibb Co., 85 F.3d 270, 274 (7th Cir. 1996). However, a
“materially adverse change might be indicated by a termina‐
tion of employment, a demotion evidenced by a decrease in
wage or salary, a less distinguished title, a material loss of
benefits, significantly diminished material responsibilities, or
other indices that might be unique to a particular situation.”
Oest v. Ill. Dep’t of Corrs., 240 F.3d 605, 612–13 (7th Cir. 2001)
(quotation and citation omitted) (emphasis added); see also
Porter v. City of Chicago, 700 F.3d 944, 954 (7th Cir. 2012) (ex‐
plaining that a “materially adverse change might be indicat‐
8 No. 13‐1200
ed by a … demotion evidenced by … significantly dimin‐
ished material responsibilities”).
The amended complaint alleges that Lavalais’s assign‐
ment to the midnight shift for an indefinite period of time
stripped him of his authority as a sergeant, significantly di‐
minished his job responsibilities, and caused him to be “vir‐
tually powerless” as a sergeant. It also alleges that Lavalais
is “seldom permitted to perform sergeant duties,” including
“instructing officers on what actions they should take [or]
not take,” First Am. Compl. ¶ 19(c), and that his employer
“does not want a black person giving orders to lower rank‐
ing officers,” id. ¶ 21. And it is alleged that Lavalais’s “duties
are so severely restricted, it is as if he is not a sergeant.” Alt‐
hough the complaint does not provide a lot of factual detail,
given the uncomplicated nature of Lavalais’s race discrimi‐
nation claim, the allegations are sufficient to plead that the
denial of a transfer from the midnight shift as well as La‐
valais’s treatment on that shift are materially adverse em‐
ployment actions.
The complaint also alleges that the assignment to the
midnight shift was a demotion, which only adds confusion.
A “constructive demotion” is when an employer has made
conditions so unbearable that a reasonable person would
have felt compelled to accept a demotion rather than remain
in his current position. That is not Lavalais’s claim. Instead,
he alleges that despite his promotion to sergeant, the denial
of a transfer to another shift prohibits him from realizing the
supervisory responsibilities and duties of that position.
Lavalais argues that he may assert a hostile work envi‐
ronment claim even though he did not assert such a claim in
his complaint. He cites Rabe v. United Air Lines, Inc., 636 F.3d
No. 13‐1200 9
866, 872 (7th Cir. 2011), for the proposition that a complaint
need not identify legal theories. While true, a complaint
nonetheless must allege some facts that support whatever
theory the plaintiff asserts. E.g., McCauley, 671 F.3d at 616.
Nothing in Lavalais’s amended complaint or his EEOC
charge fairly suggests a hostile work environment, so such a
claim fails. See Hottenroth v. Vill. of Slinger, 388 F.3d 1015,
1035–36 (7th Cir. 2004) (affirming dismissal of hostile work
environment claim where EEOC complaints failed to allege
anything that could reasonably be considered a hostile envi‐
ronment).
Turning to the § 1983 claims, the district court erred in
concluding that a plaintiff need not allege a materially ad‐
verse employment action to state a claim under § 1983. The
court relied on Power v. Summers, 226 F.3d 815 (7th Cir.
2000), but the § 1983 claim in that case alleged retaliation in
violation of the First Amendment, a claim for which an ad‐
verse employment action is not required. Here, the § 1983
claim is based on race discrimination in violation of the
Equal Protection Clause, a claim for which a materially ad‐
verse employment action is required. See Rodgers v. White,
657 F.3d 511, 517 (7th Cir. 2011) (Title VII and § 1983 race
discrimination employment claims are analyzed under the
same standards). Lavalais has alleged a sufficiently material‐
ly adverse employment action, so his § 1983 race discrimina‐
tion claim (like his Title VII claim) survives the motion to
dismiss.
The district court also erred in analyzing the equal protec‐
tion claim under the class‐of‐one doctrine and dismissing it
under Engquist v. Oregon Department of Agriculture, 553 U.S.
591, 607–08 (2008), which held that “the class‐of‐one theory
10 No. 13‐1200
of equal protection has no application in the public employ‐
ment context.” The equal protection claim is not a class‐of‐
one discrimination claim, but a race discrimination claim.
Finally, we affirm the dismissal of the municipal liability
claim because Lavalais has failed to challenge the dismissal
of that claim on appeal and thus has waived that claim. See
Logan, 644 F.3d at 583.
III. Conclusion
The district court’s judgment is AFFIRMED in part and
VACATED in part, and the case is remanded for further pro‐
ceedings consistent with this opinion.
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38 F.Supp.2d 1213 (1998)
UNITED STATES of America, Plaintiff,
v.
1020 ELECTRONIC GAMBLING MACHINES, Defendant.
No. CS-98-265-FVS.
United States District Court, E.D. Washington.
December 10, 1998.
*1214 James R. Shively, Thomas O. Rice, Assist. U.S. Attorneys, Spokane, WA, for plaintiff.
Scott D. Crowell, David R. Lundgren, Kirkland, WA, for defendant.
ORDER GRANTING FORFEITURE
VAN SICKLE, District Judge.
THIS MATTER came before the Court based upon cross motions for summary judgment. The United States was represented by Assistant United States Attorneys James R. Shively and Thomas O. Rice. The Spokane Tribe of Indians was represented by Scott D. Crowell and David R. Lundgren.
I.
The Spokane Tribe of Indians ("Tribe") is operating 1020 electronic gambling machines on its reservation. The United States seeks the machines' forfeiture under the Johnson Act, 15 U.S.C. §§ 1171-1178. The Tribe has filed a claim to the machines, see Rule C(6), Supplemental Rules for Certain Admiralty and Maritime Claims, 28 U.S.C., and opposes the government's request for forfeiture. The Court has jurisdiction by virtue of 28 U.S.C. §§ 1345 and 1355.
II.
The Johnson Act prohibits the possession of gambling devices within Indian country. 15 U.S.C. § 1175(a).[1] Gambling devices possessed in violation of § 1175(a) are subject to forfeiture. 15 U.S.C. § 1177. Forfeiture actions brought under the Johnson Act are governed by "customs laws." Id. Consequently, the parties' burdens in this action are derived from 19 U.S.C. § 1615. United States v. $129,727.00 U.S. Currency, 129 F.3d 486, *1215 492 (9th Cir.1997), cert. denied, ___ U.S. ___, 118 S.Ct. 1399, 140 L.Ed.2d 657 (1998). Under 19 U.S.C. § 1615, the United States must first demonstrate probable cause to believe the defendant machines are being possessed or used in violation of 15 U.S.C. § 1175(a). See id. If the United States does so, the burden shifts to the Tribe to demonstrate that the machines are not forfeitable. See id.
The Tribe concedes the defendant machines are gambling devices as defined by 15 U.S.C. § 1171. (Stipulation of August 3, 1998 at 2-3.) The Tribe further concedes the machines are being possessed and used within Indian Country. Id. The Tribe's concession is sufficient to establish probable cause. Thus, the burden shifts to the Tribe to explain why the machines should not be forfeited. 19 U.S.C. § 1615.
III.
Since, according to the Tribe, the Johnson Act does not preclude states from possessing or using gambling devices, Indian tribes should be excluded as well. As authority, the Tribe cites Reich v. Great Lakes Indian Fish and Wildlife Commission, 4 F.3d 490 (7th Cir.1993) (hereinafter "Great Lakes"). In that case, the question was whether a section of the Fair Labor Standards Act, 29 U.S.C. §§ 201-219, that limits the circumstances in which state and local governments must pay overtime to their law enforcement officers applies to Indian tribes even though the FLSA does not mention tribes. Id. at 493. Finding no good reason to deny Indian tribes the benefit of the exception, and concluding that considerations of comity and respect for tribal sovereignty weighed in favor of extending the exception to tribes, the Seventh Circuit did just that. Id. at 494-95.
The Tribe's reliance upon Great Lakes is misplaced. In order for the Seventh Circuit's rationale to apply, § 1175(a) would have to allow states, but not Indian tribes, to operate gambling devices within "Indian Country." Nothing could be further from the truth. Section 1175(a) makes no distinction between tribes and states with respect to the operation of gambling devices on Indian reservations. As a result, the Seventh Circuit's decision offers little guidance here.
Next, the Tribe argues that § 1175(a) does not prevent Indian tribes from possessing or using gambling devices. The Tribe notes that state regulation of gaming on Indian reservations implicates tribal sovereignty. See California v. Cabazon Band of Mission Indians, 480 U.S. 202, 218-22, 107 S.Ct. 1083, 1093-95, 94 L.Ed.2d 244 (1987). Since, as a general rule, tribal sovereignty may not be infringed absent an unmistakable expression of Congressional intent, see Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58-59, 98 S.Ct. 1670, 1677, 56 L.Ed.2d 106 (1978), and since § 1175(a) does not mention Indian tribes, the Tribe submits it is not governed by § 1175(a).
The Tribe is mistaken. Section 1175 clearly governs gaming on Indian reservations. See, e.g., United States v. Farris, 624 F.2d 890, 898 (9th Cir.1980), cert. denied, 449 U.S. 1111, 101 S.Ct. 919, 66 L.Ed.2d 839 (1981). Moreover, the sweeping language of § 1175(a) is an unmistakable indication Congress intended to divest all persons including Indian tribes of the authority to operate gambling devices within Indian country.[2] Consequently, the fact Indian tribes are not mentioned in § 1175(a) is of no significance. See Donovan v. Coeur d'Alene Tribal Farm, 751 F.2d 1113, 1115-16 (9th Cir.1985).
That conclusion is supported by the text of the Indian Gaming Regulatory Act ("IGRA"), 25 U.S.C. § 2701 et seq. IGRA divides games of chance into three classes. United States v. Spokane Tribe of Indians, 139 F.3d 1297, 1299 (9th Cir.1998) ("Spokane Tribe"). The defendant machines are used for Class III gaming. As the United States points out, IGRA creates a conditional exemption for class III gaming:
*1216 The provisions of section 1175 of Title 15 shall not apply to any (class III) gaming conducted under a Tribal-State compact that
(A) is entered into ... by a State in which gambling devices are legal, and
(B) is in effect.
25 U.S.C. § 2710(d)(6). The fact Congress created a conditional exception for class III gaming indicates that Congress intends such gaming and its sponsors to remain subject to § 1175(a) until the relevant conditions are satisfied.
For the defendant machines to be exempt from § 1175(a), the Tribe must have a compact with the State of Washington. 25 U.S.C. § 2710(d)(6). The Tribe freely concedes it does not. Thus, the defendant machines are subject to § 1175(a). See Crow Tribe of Indians v. Racicot, 87 F.3d 1039, 1046 (9th Cir.1996) (where an Indian tribe operated slot machines that were not permitted by its IGRA compact with the State of Montana, "the Johnson Act [was] applicable and the use of slot machines [was] illegal").
IV.
Nonetheless, the Tribe objects to forfeiture, alleging that the State of Washington has refused to negotiate in good faith. Since the Tribe cannot bring an action in federal court to compel the State to negotiate, Spokane Tribe, 139 F.3d at 1299, the Tribe argues that the Attorney General has a duty to bring an action against the State on its behalf, or that the Secretary of the Interior has a duty to promulgate regulations adjudicating its rights under IGRA.
The United States "owes a fiduciary obligation to all Indian tribes as a class." Inter Tribal Council of Arizona v. Babbitt, 51 F.3d 199, 203 (1995). More specific fiduciary duties may arise when the United States manages Indian resources. See id. For example, in United States v. Mitchell, 463 U.S. 206, 210, 103 S.Ct. 2961, 2965, 77 L.Ed.2d 580 (1983), the Supreme Court noted that the Secretary of the Interior had assumed a "pervasive role" in the sale of timber grown on the Quinault Reservation in western Washington. Id. at 219, 103 S.Ct. at 2969. The Secretary's role was spelled out in detail in timber management statutes and the regulations promulgated thereunder. Id. 219-223, 103 S.Ct. at 2969-71. Those statutes and regulations, the Supreme Court said, "clearly [gave] the Federal Government full responsibility to manage Indian resources and land for the benefit of the Indians. They thereby establish[ed] a fiduciary relationship and define[d] the contours of the United States' fiduciary responsibilities." Id. at 224, 103 S.Ct. at 2971-72.[3]
The Tribe argues that specific fiduciary duties may be imposed upon the United States based upon the roles assigned to the National Indian Gaming Commission, 25 U.S.C. § 2704, and the Secretary of the Interior. Neither contention can be sustained.
The Commission does have significant powers. 25 U.S.C. § 2706. However, the authority it exercises is regulatory in nature, not managerial. Furthermore, it regulates class II gaming, whereas this case involves class III gaming. As a result, there is no basis for imposing specific trust duties upon the United States due to the Commission's role in Indian gaming.
Evaluating the role assigned to the Secretary of the Interior is more complicated because IGRA has been altered by the Supreme Court. Seminole Tribe of Florida v. Florida, 517 U.S. 44, 74-75, 116 S.Ct. 1114, 1133, 134 L.Ed.2d 252 (1996) (Congress violated the Eleventh Amendment by including a clause abrogating the states' immunity from suit in federal court). However, even before Seminole, the Secretary was not responsible for negotiating Tribal-State compacts. That was the task *1217 of tribes and states. 25 U.S.C. § 2710(d)(3). Nor was the Secretary responsible for bringing failure-to-negotiate actions against states. That was the task of tribes. 25 U.S.C. § 2710(d)(7). Nor was the Secretary assigned a major role in resolving such disputes. During the pre-Seminole dispensation, federal courts were to appoint independent mediators. 25 U.S.C. § 2710(d)(7)(B)(iv). It was the mediator who evaluated competing compacts. Id. While the Secretary was responsible for promulgating those regulations necessary to implement the mediator's decision, the Secretary's discretion was limited. 25 U.S.C. § 2710(d)(7)(vii). Finally, after a compact was in place, the Secretary had no role in managing class III gaming. That was the tribe's responsibility. In the aftermath of Seminole, the Secretary's role is even less significant. As a result, there is no basis for imposing specific trust duties upon the United States due to the Secretary's role in Indian gaming. See Pueblo of Santa Ana v. Kelly, 932 F.Supp. 1284, 1298 (D.N.M.1996), affirmed on other grounds, 104 F.3d 1546 (10th Cir.1997). Cf. Shoshone-Bannock Tribes v. Reno, 56 F.3d 1476, 1482 (D.C.Cir.1995) ("an Indian tribe cannot force the government to take a specific action unless a treaty, statute or agreement imposes, expressly or by implication, that duty").
That view is not unanimous of course. In Chemehuevi Indian Tribe v. Wilson, 987 F.Supp. 804, 808 (N.D.Cal.1997), another court concluded:
A duty on behalf of the United States to sue the State to bring it to the bargaining table can certainly be implied from IGRA, since it appears that that is the only legal remedy available to the plaintiff Tribes to seek the benefits Congress intended them to have and to preserve the balance Congress carefully struck between the interests of the states and the tribes.
While Chemehuevi offers a solution to the dilemma posed by Seminole, the solution Chemehuevi offers is not without problems of its own. For one thing, while it is clear Congress intended Indian tribes to have a remedy against recalcitrant states, it is equally clear Congress did not intend the Secretary to litigate failure-to-negotiate claims. Indeed, since Seminole, Congress has taken steps to keep the Secretary out of the fray. Department of the Interior and Related Agencies Appropriations Act, 1998, Pub.L. 105-83, § 129(b)(1)(A), 111 Stat. 1543, 1568 ("During fiscal year 1998, the Secretary may not expend any funds made available under this Act to review or approve any initial Tribal-State compact for class III gaming entered into on or after the date of enactment of this Act."). Consequently, had Congress anticipated Seminole, it is unlikely Congress would have required the Secretary to bring failure-to-negotiate claims against states.
For another thing, "[a]n agency's decision not to prosecute or enforce, whether through civil or criminal process, is a decision generally committed to an agency's absolute discretion." Heckler v. Chaney, 470 U.S. 821, 831, 105 S.Ct. 1649, 1655 84 L.Ed.2d 714 (1985) (citations omitted). This case illustrates the wisdom of that rule. Indian gaming raises a number of complicated issues. 25 U.S.C. § 2702. Seminole has not made the resolution of those issues any easier. Confronted with a difficult situation, neither the Secretary nor the Attorney General wants to bring an action against the State of Washington. Instead, the Attorney General has decided to seek forfeiture of the defendant machines. This Court is in no position to second guess that decision. See Heckler, 470 U.S. at 831-32, 105 S.Ct. at 1655-56 (explaining why the judiciary is ill suited to review enforcement decisions).
That leaves the Tribe's request for agency rulemaking. The Tribe insists that the Secretary may act unilaterally to prevent a state from obstructing federal legislation, see Alabama v. United States Department of Interior, 84 F.3d 410, 418-19 (11th Cir.1996), and that the Secretary should be required to exercise that authority in this instance. The Tribe's suggestion is unpersuasive. One, there is no *1218 credible evidence of bad faith on the State's part.[4] Two, the Secretary has chosen not to exercise his rulemaking authority in this instance. Since he has no trustrelated duty to issue regulations, his decision to refrain from doing so is not subject to review. See Heckler, 470 U.S. at 831, 105 S.Ct. at 1655.
V.
The Tribe may not avoid forfeiture even if the Attorney General has a duty to bring a failure-to-negotiate action against the State, or the Secretary has a duty to engage is rulemaking. The purpose of a failure-to-negotiate action (and, to a lesser extent, administrative rulemaking) is to bring a state to the bargaining table. It is unclear how long negotiations would take in this case, or whether they would result in a Tribal-State compact approving the use of the defendant machines.[5] Unless and until a compact is reached, the Tribes' possession and use of the defendant machines is unlawful. 15 U.S.C. § 1175(a); 25 U.S.C. § 2710(d)(6). The Tribes are not entitled to engage in a continuing violation of the Johnson Act in the hope their behavior will be validated someday.
VI.
The Johnson Act makes it unlawful for the Tribe to possess or use the defendant machines on its reservation. 15 U.S.C. § 1175(a). The Tribe is bound by that prohibition unless, at a minimum, its has a Tribal-State compact authorizing the use of the machines, 25 U.S.C. § 2710(d)(6), and the machines are legal in Washington. 25 U.S.C. § 2710(d)(6)(A). Since the Tribe freely concedes it does not have a compact with the State of Washington, the machines are subject to forfeiture whether or not the State permits their use. Consequently, the question of the machines' legality need not be resolved in this proceeding. The United States is entitled to custody of the machines pursuant to the stipulation of August 3, 1998.
VII.
To summarize, the Supreme Court's Seminole decision makes it more difficult for Indian tribes to conduct class III gaming on their reservations. Congress is aware of that fact. Congress may change the law if chooses to do so. Until it does, the Tribe is violating the Johnson Act by operating 1020 electronic gambling machines on its reservation. This Court is not free to ignore the violation or rewrite federal law.
IT IS HEREBY ORDERED:
1. The government's "Motion for Warrant of Arrest in Rem and Writ of Entry" (Ct.Rec.2) is granted.
2. The government's motion for summary judgment (Ct.Rec.13) is granted. The Tribe is to surrender the defendant machines to the United States pursuant to the terms of the stipulation of August 3, 1998.
3. The Tribe's motions to dismiss (Ct. Rec.19) and to stay (Ct.Rec.20) are denied.
4. All other pending motions are denied as moot.
IT IS SO ORDERED. The District Court Executive is hereby directed to enter *1219 this Order and furnish copies to counsel.
NOTES
[1] Subsection (a) provides in its entirety:
It shall be unlawful to manufacture, recondition, repair, sell, transport, possess, or use any gambling device in the District of Columbia, in any possession of the United States, within Indian country as defined in section 1151 of Title 18 or within the special maritime and territorial jurisdiction of the United States as defined in section 7 of Title 18, including on a vessel documented under chapter 121 of Title 46 or documented under the laws of a foreign country.
[2] Nothing in 15 U.S.C. § 1175(a) limits its application to individuals.
[3] There is no reason to limit Mitchell to damage claims. See, e.g., Shoshone-Bannock Tribes v. Reno, 56 F.3d 1476, 1482-83 (D.C.Cir.1995) (applying Mitchell to a tribe's request that the Attorney General bring an action on its behalf).
[4] Recently, for example, the State reached an agreement concerning Indian gaming with twelve Washington tribes. Commission Approves Online Lottery Games For 12 Tribes, Seattle Post-Intelligencer, November 13, 1998.
[5] Two United States District Courts (this one included) have determined that the laws of the State of Washington do not permit the use of slot machines. United States v. Approximately 108 Electronic Gambling Machines, C98-5321R (W.D.Wash. Sept. 18, 1998); Washington v. The Confederated Tribes of the Chehalis Reservation, No. C-95-1805-FVS (E.D.Wash. Sept. 26, 1997). Nor are the relevant state statutes likely to change anytime soon. On two occasions, Washington voters have refused to case state laws that effectively restrict gaming on Indian reservations. Jim Simon, Major Defeat for Gambling Measure, Seattle Times, November 8, 1995; Barbara A. Serrano, Bears Win One, But Tribes Lost Bet on Gambling Measure, Seattle Times, November 6, 1996.
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21 Ill.2d 469 (1961)
173 N.E.2d 443
MAX OLINGER, Appellant,
v.
THE GREAT ATLANTIC AND PACIFIC TEA COMPANY et al., Appellees.
No. 36038.
Supreme Court of Illinois.
Opinion filed March 29, 1961.
*470 *471 LISTEMAN AND BANDY, of East St. Louis, and R.K. PEEK, of Du Quoin, for appellant.
OEHMKE, DUNHAM & BOMAN, of East St. Louis, for appellees.
Judgment affirmed.
Mr. JUSTICE KLINGBIEL delivered the opinion of the court:
Plaintiff, Max Olinger, sued defendants, The Great Atlantic and Pacific Tea Company and its store manager, Eddie Graves, for personal injuries sustained when he slipped and fell on the floor of defendants' store. The cause was submitted to a jury and plaintiff was awarded a verdict of $30,000. The trial court entered judgment on the verdict, which judgment was reversed by the Appellate Court. (26 Ill. App.2d 88.) This court has granted plaintiff leave to appeal.
The issue in this cause, as was correctly stated by the Appellate Court, is whether, under the facts and circumstances most favorable to plaintiff, there was any evidence of negligence by defendants in the maintenance of the store *472 premises which could properly be submitted to the jury. Donoho v. O'Connell's, Inc., 13 Ill.2d 113.
The facts, briefly stated, are as follows:
Early in the afternoon of August 22, 1956, plaintiff entered defendants' self-service chain store through the only customer entrance. He walked 20 to 25 feet in a southerly direction and then turned right into an aisle into the main portion of the store. As plaintiff turned to the right, he slipped and fell injuring his back.
Plaintiff testified that after he fell, he noticed a substance on the floor where he had slipped. It was described by him as a thin oil, pinkish or light red in color, covering a spot of 6 or 7 inches. He saw a skid mark 3 1/2 to 4 feet long through this substance. He tasted it and found it was sweetish in taste, abrasive, a little bit sticky. Plaintiff also testified that some of the substance was on his shoes after the fall.
Other witnesses testified that they observed a small spot of a semi-solid reddish substance near the place where plaintiff had fallen. They described the spot as being no larger than a small jelly bean, smaller than a dime, the size of a nickel, possibly a quarter. The ambulance driver testified that he observed a reddish, semi-solid substance, about the size of the end of his finger, on plaintiff's right shoe. No one testified as to the identity or name of the substance observed.
At or near the corner where plaintiff fell, there was a notions counter having 4 or 5 open shelves upon which merchandise, such as gauze, first aid items, tooth paste, tooth brushes, shaving cream, hair oil, and similar items, were displayed. There was evidence tending to show that on the day of plaintiff's fall, bottles of Coldene, a red liquid cough medicine, were on display on the notions counter. One of plaintiff's witnesses testified that the second week in September, two or three weeks after the occurrence in question, he went to defendants' store at plaintiff's request and purchased *473 a bottle of Coldene from the notions counter. This witness also testified that at the time of that purchase there was another bottle of Coldene on display which looked like some of the liquid was out of it and was sticky on the outside.
The trial court ruled that the evidence warranted submission of the issue of defendants' negligence to the jury. In denying defendants' motions for directed verdict, the trial judge stated: "Well, there is no question but what, under the Fourth District Appellate Court law, this case isn't any good, but under the Supreme Court law, I think they have practically said if you fall down in a store the store is liable. Regardless of what my feelings are in the matter, I have to be guided by the Supreme Court." The Appellate Court disagreed, and reversed the judgment entered on the verdict in favor of plaintiff. We are thus confronted with the problem of ascertaining, from the evidence and inferences most favorable to plaintiff, whether the issue of defendants' negligence in the maintenance of the store premises should have been submitted to the jury. Mueller v. Elm Park Hotel Co., 398 Ill. 60.
It is not questioned that plaintiff's status, at the time of his injury, was that of a business invitee on defendants' premises. As such, defendants owed him the duty of exercising ordinary care in maintaining the premises in a reasonably safe condition. (Geraghty v. Burr Oak Lanes, Inc. 5 Ill.2d 153.) The applicability of this familiar rule provokes no challenge. Its actual application, however, raises the difficult question of the kind and quantity of evidence necessary to establish a breach of that duty.
In the recent case of Donoho v. O'Connell's, Inc., 13 Ill.2d 113, we carefully reviewed and re-examined the case law of both this and other jurisdictions pertaining to the liability of owners and proprietors for injuries to business invitees caused by slipping on foreign substances on their floors. Therefore we consider it unnecessary to repeat the *474 factual analysis of the many cases on this subject which appeared in the Donoho opinion. But, in view of certain statements of the trial judge and the parties in this case, we do feel compelled to again outline the general principles of law which are involved here.
Where a business invitee is injured by slipping on a foreign substance on the premises, liability may be imposed if the substance was placed there by the negligence of the proprietor or his servants, or, if the substance was on the premises through acts of third persons or there is no showing how it got there, liability may be imposed if it appears that the proprietor or his servant knew of its presence, or that the substance was there a sufficient length of time so that in the exercise of ordinary care its presence should have been discovered. Davis v. South Side Elevated Railroad Co., 292 Ill. 378; Pabst v. Hillmans, 293 Ill. App. 547; Schmelzel v. Kroger Grocery and Baking Co., 342 Ill. App. 501; Annotation, 61 A.L.R.2d 6 et seq.
For purposes of deciding whether a given case should have been submitted to the jury, the above authorities may be reduced to two more specific propositions.
1. Where a business invitee is injured by slipping on a foreign substance on defendant's premises, and there is evidence tending to show that the substance was on the floor through the acts of defendant or his servants, the issue of negligence will be submitted to the jury.
2. Where a business invitee is injured by slipping on a foreign substance on defendant's premises, and there is evidence tending to show that defendant or his servants knew or should have known of its presence, the issue of negligence will be submitted to the jury.
We are not here concerned with the second proposition relating to notice since plaintiff has made no contention here or in the Appellate Court that the evidence tended to establish actual or constructive notice to defendants.
Plaintiff contends instead that sufficient evidence was *475 introduced to establish that the substance on which he slipped was on the floor through the act of defendants or their servants and, therefore, the trial court was correct in submitting the issue of defendants' negligence to the jury.
In adjudging this contention we are confronted with the question of the quantity of proof required under the first proposition stated above. If, of course, there is direct evidence that the foreign substance was on the floor through the acts of defendant or his servants, the issue of negligence is a question of fact for the jury. Frequently, however, there is no direct evidence as to how the foreign substance got on the premises. The question then is what circumstantial evidence is sufficient to sustain a reasonable inference that the substance was there through the act of defendant or his servants. It is this facet of the problem to which the Donoho decision specifically applies.
Where, in such case, the foreign substance was unrelated to the proprietor's operations and there is no proof of actual or constructive notice, defendant is entitled to a directed verdict, since there is no evidence from which it could be reasonably inferred that the substance was more likely to have been dropped by defendant's servants than by third persons. (Davis v. South Side Elevated Railroad Co., 292 Ill. 378; Antibus v. W.T. Grant Co., 297 Ill. App. 363; Michelson v. Mandel Brothers, Inc. 322 Ill. App. 691.) Likewise, even where there is proof that the foreign substance was related to defendant's business, but no further evidence is offered other than the presence of the substance and the occurrence of the injury, defendant is entitled to a directed verdict, such evidence being insufficient to support the necessary inference. Jones v. Kroger Grocery and Baking Co., 273 Ill. App. 183; Schmelzel v. Kroger Grocery and Baking Co., 342 Ill. App. 501.
"Where, however, in addition to the fact that the substance on the floor was a product sold or related to defendant's *476 operations, the plaintiff offers some further evidence, direct or circumstantial, however slight, such as the location of the substance or the business practices of the defendant, from which it could be inferred that it was more likely that defendant or his servants, rather than a customer, dropped the substance on the premises, courts have generally allowed the negligence issue to go to the jury, without requiring defendant's knowledge or constructive notice." Donoho v. O'Connell's, Inc., 13 Ill.2d 113 at 122.
In the instant case, there is no direct evidence as to how the foreign substance came to be on defendants' floor. Moreover, there is not even any evidence as to what that substance was. No one testified that the substance was Coldene. The best that can be said of plaintiff's evidence is that plaintiff slipped on a reddish substance and defendant sold red cough medicine called Coldene. Only by the wildest speculation could it be concluded from these facts that the substance on which plaintiff slipped was Coldene. Since the evidence failed to establish that the substance was related to defendants' operations, no inference could be drawn that the substance was more likely to have been dropped by defendants' servants under the Donoho rule. Having failed to show that the substance was related to defendants' business, it is unnecessary for us to decide whether plaintiff offered other evidence which would permit an application of the Donoho rule.
We firmly adhere to the rule that a storekeeper is not the insurer of his customer's safety. Liability must be founded on fault, and where, as here, there is no evidence, direct or inferential, of negligence by defendants in the maintenance of the store premises, liability may not be imposed.
The trial court erred in submitting the negligence issue to the jury. The decision of the Appellate Court reversing the judgment for plaintiff is affirmed.
Judgment affirmed.
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In the
Court of Appeals
Second Appellate District of Texas
at Fort Worth
___________________________
No. 02-19-00349-CV
___________________________
IN THE INTEREST OF F.S. AND H.R., CHILDREN
On Appeal from the 393rd District Court
Denton County, Texas
Trial Court No. 18-2535-393
Before Sudderth, C.J.; Bassel and Womack, JJ.
Memorandum Opinion by Chief Justice Sudderth
MEMORANDUM OPINION
Appellant Mother M.R. appeals the termination of her parental rights to her
children, H.R. and F.S. See Tex. Fam. Code Ann. § 161.001. Mother’s court-
appointed appellate counsel filed a motion to withdraw as counsel and a brief in
support of that motion. See Anders v. California, 386 U.S. 738, 87 S. Ct. 1396 (1967); In
re P.M., 520 S.W.3d 24, 27 (Tex. 2016). Counsel’s brief and motion meet the
requirements of Anders by presenting a professional evaluation of the record
demonstrating why there are no arguable grounds for relief. See 386 U.S. at 741–
42, 87 S. Ct. at 1399. Mother filed a response, but she did not demonstrate any
arguable grounds for relief.
As the reviewing appellate court, we must independently examine the record to
decide whether counsel is correct in determining that an appeal in this case is
frivolous. See Stafford v. State, 813 S.W.2d 503, 511 (Tex. Crim. App. 1991); In re
K.R.C., 346 S.W.3d 618, 619 (Tex. App.—El Paso 2009, no pet.). Having carefully
reviewed the record and the Anders brief, we agree with counsel that the appeal is
frivolous. See K.R.C., 346 S.W.3d at 619. We find nothing in the record that might
arguably support Mother’s appeal. Accordingly, we affirm the trial court’s judgment.
We deny Mother’s counsel’s motion to withdraw in light of In re P.M. because
the brief does not show “good cause” other than counsel’s determination that an
appeal would be frivolous. 520 S.W.3d at 27 (“[A]n Anders motion to withdraw
brought in the court of appeals, in the absence of additional grounds for withdrawal,
2
may be premature.”); In re A.M., 495 S.W.3d 573, 582–83 (Tex. App.—Houston [1st
Dist.] 2016, pet. denied) (noting that since In re P.M. was handed down, “most courts
of appeals affirming parental termination orders after receiving Anders briefs have
denied the attorney’s motion to withdraw”). The supreme court has held that in cases
such as this, “appointed counsel’s obligations [in the supreme court] can be satisfied
by filing a petition for review that satisfies the standards for an Anders brief.” P.M.,
520 S.W.3d at 27–28.
/s/ Bonnie Sudderth
Bonnie Sudderth
Chief Justice
Delivered: January 23, 2020
3
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 12-6234
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
BRANDON TAYLOR COOPER,
Defendant - Appellant.
Appeal from the United States District Court for the Southern
District of West Virginia, at Huntington. Robert C. Chambers,
District Judge. (3:07-cr-00056-1)
Submitted: June 22, 2012 Decided: July 5, 2012
Before WILKINSON, DUNCAN, and THACKER, Circuit Judges.
Affirmed by unpublished per curiam opinion.
Brandon Taylor Cooper, Appellant Pro Se. Richard Gregory McVey,
Assistant United States Attorney, Huntington, West Virginia, for
Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Brandon Taylor Cooper appeals the district court’s
order denying his 18 U.S.C. § 3582(c)(2) (2006) motion for
reduction in sentence. We have reviewed the record and find no
reversible error. Accordingly, we deny Cooper’s motion for
appointment of counsel and affirm for the reasons stated by the
district court. United States v. Cooper, No. 3:07-cr-00056-1
(S.D. W. Va. Feb. 1, 2012). We deny cooper’s motion to expedite
as moot. 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.
AFFIRMED
2
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Order entered August 11, 2020
In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-20-00154-CR
No. 05-20-00155-CR
CHARLES TURNER GLOVER, Appellant
V.
THE STATE OF TEXAS, Appellee
On Appeal from the Criminal District Court No. 1
Dallas County, Texas
Trial Court Cause Nos. F18-55030-H & F18-55032-H
ORDER
Appellant’s brief was due on June 13, 2020. When it was not filed, we
notified appellant by postcard dated June 17 and directed him to file a brief and a
motion to extend time to file the same within ten days. The following day,
appellant filed an extension motion which we granted, making the brief due on
July 18, 2020. To date, no brief has been filed and we have had no communication
from appellant.
We ORDER appellant’s brief filed by August 21, 2020. Failure to do so
will result in the appeal being abated without further notice for a hearing under rule
38.8(b)(4).
We DIRECT the Clerk to send copies of this order to the Honorable Tina
Yoo Clinton, Presiding Judge, Criminal District Court No. 1, to Valencia Bush,
and the Dallas County District Attorney Appellate Division.
/s/ LANA MYERS
JUSTICE
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United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS April 23, 2003
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
Clerk
No. 02-11042
Conference Calendar
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
CURTIS DALE DAUGHERTY,
Defendant-Appellant.
--------------------
Appeal from the United States District Court
for the Northern District of Texas
USDC No. 6:01-CR-069-01-C
--------------------
Before DAVIS, BARKSDALE, and STEWART, Circuit Judges.
PER CURIAM:*
The Federal Public Defender, appointed to represent Curtis
Dale Daugherty (“Daugherty”), has requested leave to withdraw and
has filed a brief as required by Anders v. California, 386 U.S.
738 (1967). Daugherty has received a copy of counsel’s motion
and brief and has filed a response. Our independent review of
the brief and the record discloses no nonfrivolous issue for
appeal. The record has not been adequately developed for us to
consider in this direct appeal the ineffective assistance claims
*
Pursuant to 5TH CIR. R. 47.5, the court has determined
that this opinion should not be published and is not precedent
except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
No. 02-11042
-2-
raised by Daugherty. See United States v. Gibson, 55 F.3d 173,
179 (5th Cir. 1995). Counsel’s motion for leave to withdraw is
GRANTED, counsel is excused from further responsibilities, and
the appeal is DISMISSED. See 5TH CIR. R. 42.2.
MOTION GRANTED; APPEAL DISMISSED.
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Fourth Court of Appeals
San Antonio, Texas
JUDGMENT
No. 04-13-00457-CR
Mark Wayne EVANS,
Appellant
v.
The STATE of Texas,
Appellee
From the 54th Judicial District Court, McLennan County, Texas
Trial Court No. 2012-1167-C2
Honorable Matt Johnson, Judge Presiding
BEFORE JUSTICE BARNARD, JUSTICE MARTINEZ, AND JUSTICE ALVAREZ
In accordance with this court’s opinion of this date, the trial court’s judgment is
AFFIRMED.
SIGNED June 18, 2014.
_____________________________
Patricia O. Alvarez, Justice
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949 F.2d 400
NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel.UNITED STATES of America, Plaintiff-Appellee,v.Richard L. RADLEY, aka: Ricky Larue Radley; aka: RickyLareau Radley (true name), Defendant-Appellant.
Nos. 90-50259, 90-50383.
United States Court of Appeals, Ninth Circuit.
Submitted Aug. 16, 1991.*Decided Dec. 4, 1991.
1
Before WALLACE, Chief Judge, GOODWIN, Circuit Judge, and TANNER,** District Judge.
MEMORANDUM
2
Radley and Hardin appeal from their convictions for possession with intent to distribute a controlled substance in violation of 21 U.S.C. § 841(a)(1). We have jurisdiction over this timely appeal pursuant to 28 U.S.C. § 1291. We affirm.
3
Radley contends that the district court improperly denied his motion to sever because the defenses presented by Radley and Hardin were mutually exclusive. A district court's decision to deny a motion to sever is reviewed for an abuse of discretion. United States v. Unruh, 855 F.2d 1363, 1374 (9th Cir.1987), cert. denied, 488 U.S. 974 (1988). Severance is mandated when the defenses presented by the two defendants "are antagonistic to the point of being mutually exclusive" and the "acceptance of one party's defense will preclude the acquittal of the other party." United States v. Ramirez, 710 F.2d 535, 546 (9th Cir.1983) (internal quotations omitted). However, the defenses in this case clearly conflict only as to Radley's presence. The government must still establish knowledge and the other elements of the crime in order to obtain a conviction. Therefore, the district court did not abuse its discretion.
4
Radley also contends that the district court erred by excluding the testimony of some of his alibi witnesses because their testimony would be cumulative. However, we will not address this issue because at the time of the district court's ruling, Radley made no offer of proof as to how this additional testimony might differ from the testimony previously heard. See Fed.R.Evid. 103(a).
5
We also disagree with Radley's contention that the district court improperly admitted the identification testimony of the detectives because their testimony was based on an out-of-court identification. The detectives were trained professionals and there was evidence that their identification testimony was reliable. Under the circumstances of this case, reversal is not warranted. See United States v. Dring, 930 F.2d 687, 692-93 (9th Cir.1991).
6
Radley further contends that the district court erred in permitting Hardin to cross-examine Radley's witnesses concerning their knowledge of Radley's prior convictions. However, the trial judge did not allow questioning about the nature of the prior offenses or even the identity of the crimes involved. The trial judge also gave cautionary instructions. Therefore, even if we assume that the district court improperly allowed inquiry into Radley's prior convictions, reversal is not warranted because Radley suffered no prejudice. See United States v. Brown, 880 F.2d 1012, 1016 (9th Cir.1989).
7
We also disagree with Radley's contention that we must reverse because the district judge commented to the jury about a fight between the codefendants. "A federal judge has broad discretion in supervising trials, and his or her behavior during trial justifies reversal only if it abuses that discretion." United States v. Laurins, 857 F.2d 529, 537 (9th Cir.1988), cert. denied, 492 U.S. 906 (1989). Given that neither party objected to the district judge's comments and the district judge's broad discretion, the comments made by the district judge are not an abuse of discretion.
8
Radley also contends that his right to a fair trial was prejudiced because the jurors were made aware that he had been handcuffed and the district judge made certain comments concerning the marshals' right to handcuff a defendant. "Whether a defendant's right to a fair trial is violated because members of the jury observe him in handcuffs is a question of law that is reviewed independently without deference to the district court's determination of this issue." United States v. Halliburton, 870 F.2d 557, 558 (9th Cir.), cert. denied, 492 U.S. 910 (1989). In order to minimize any prejudice from the alleged viewing, the district judge polled the jury to determine if the alleged viewing of the defendant in handcuffs affected any of the jurors. The district judge also gave the jury a cautionary instruction. Moreover, the defendant failed to object to the district judge's comment concerning the right to handcuff when the comment was made. Under the circumstances of this case, reversal is not warranted. See United States v. Acosta-Garcia, 448 F.2d 395, 396 (9th Cir.1971).
9
Radley also argues that the jury was affected by the trial judge's rebuke of defense counsel. However, the jury was instructed that the district judge's rebuke of an attorney may not to be weighed against the client. There is no justification for reversal.
10
Radley finally contends that the cumulative effect of the alleged errors is that Radley was denied his right to a fair trial. This argument is also without merit.
11
Hardin claims that the district court's finding that Hardin consented to the warrantless search of the package was clearly erroneous. "We review the district court's findings of facts and determinations of credibility for clear error." United States v. George, 883 F.2d 1407, 1411 (9th Cir.1989). Two detectives testified that Hardin consented to the search. Moreover, at Hardin's second trial, Hardin arguably admitted that he consented to the search. The district court, therefore, did not commit clear error by finding that Hardin consented to the search. Also, the district court's finding that the search was within the scope of Hardin's consent was also not clearly erroneous. See Florida v. Jimeno, 111 S.Ct. 1801, 1804 (1991). We do not need to reach the issues concerning standing and the consent of Federal Express because we accept the district court's finding that Hardin consented to the search.
12
AFFIRMED.
*
The panel unanimously finds this case suitable for decision without oral argument. Fed.R.App.P. 34(a) and Ninth Circuit Rule 34-4
**
Honorable Jack E. Tanner, United States District Judge, Western District of Washington, sitting by designation
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73 B.R. 675 (1987)
In re Robert H. WOODFORD, Debtor.
Bankruptcy No. 85-01050.
United States Bankruptcy Court, N.D. New York.
January 26, 1987.
*676 Grass, Balanoff, Costa & Whitelaw, P.C., Syracuse, N.Y., for trustee; Mary Lannon Fangio, of counsel.
David W. Pelland, Syracuse, N.Y., for debtor.
MEMORANDUM-DECISION AND ORDER ON TRUSTEE'S OBJECTION TO CLAIMED EXEMPTION
STEPHEN D. GERLING, Bankruptcy Judge.
Robert H. Woodford ("Debtor") filed a petition for relief under Chapter 7 of the Bankruptcy Code, 11 U.S.C. §§ 101-151326, ("Code") on November 25, 1985. On January 23, 1986, the Trustee filed his objection to Debtor's claimed exemption of his interest in a retirement fund. The matter was submitted upon the memoranda of counsel.
FINDINGS OF FACT
At the time he filed his petition, Debtor was 58 years old, having been born on January 14, 1927. On May 31, 1985, Debtor had withdrawn as a partner from the law firm of Mackenzie, Smith, Lewis, Michell & Hughes, Esqs. ("Mackenzie firm"). Thereafter, until January 1, 1986, Debtor was employed by the Mackenzie firm as an attorney. Since that time, Debtor has continued to practice law as an attorney associated with the offices of William Weisberg, P.C. Debtor was married at the time of his individual filing, and his spouse was unemployed. Two children, ages unknown, resided at Debtor's home.
Debtor received his discharge by Order dated April 8, 1986. Debtor's Schedule of Current Income and Expenditures recites a net monthly income of $2,942.24. Debtor listed the following monthly expenditures:
Mortgage payment ..................................... $ 699.00
Electricity .......................................... 40.00
Heat ................................................. 210.00
Telephone ............................................ 36.00
Food ................................................. 460.00
Laundry & cleaning ................................... 60.00
Newspapers, periodicals, books ....................... 40.00
Medical/drug expenses ................................ 100.00
Insurance:
Auto ($760.00 per year)
Other (undefined) ($1,640.00 per year)
Total ............................................ 200.00
Car payment .......................................... 391.00
Transportation expenses .............................. 90.00
Recreation ........................................... 100.00
Real estate taxes .................................... 200.00
Misc. contributions, Christmas gifts, vacations (est.) 100.00
Contribution to in-laws' rent ........................ 200.00
_________
Total monthly expenditures ..........................$2,926.00
As of December 31, 1985, Debtor had an interest in a Retirement Plan and Trust Agreement ("Plan") established by the MacKenzie firm in the amount of $116,137.17.[1] Debtor's rights in the Plan are 100% vested (Debtor's memorandum, Exhibit B), and the Plan is a qualified plan pursuant to the terms of the Internal Revenue *677 Code. (Debtor's memorandum, Exhibit D.).
In addition to his interest in the Plan, Debtor claimed as exempt property, pursuant to Code § 522, and N.Y. Debt. & Cred. Law § 282 (McKinney Supp. 1986):
Interest in residence ..................... $10,000.00
Household goods ........................... 3,500.00
Wearing apparel ........................... 400.00
1981 Cadillac ............................. 8,250.00
The 1981 Cadillac was collateral for a secured claim of the Key Bank in the amount of $11,788.00. Debtor had initially indicated an intention to reaffirm this obligation, (Statement of Intention Re: Secured Consumer Debts) yet he did not file an agreement pursuant to Code § 524(c)(3) prior to his discharge. The Trustee abandoned the estate's interest in the automobile pursuant to Code § 554(a) on January 8, 1986, at that time indicating $12,197.42 as the net amount due on the loan. Debtor indicates he was forced to surrender the automobile. (Debtor's memorandum at p. 7).
Debtor's counsel revealed that a sale of Debtor's residence was contemplated. (Debtor's memorandum at p. 2). The residence is collateral for the secured claims of the Onondaga Savings Bank in the total amount of $64,500.00. Debtor believes the market value of the home to be $110,000.00. (Schedule A-2).
As indicated, the Plan balance as of December 13, 1985 was $116,137.17. Debtor alleges that if these funds were used to purchase a Joint Variable Immediate annuity, it would result in lifetime monthly benefits of $776.60. (Debtor's memorandum, Exhibit C). No issue has been raised as to special health concerns or needs of Debtor or his dependents.
ARGUMENTS
The Trustee argues that the Plan is not exempt because it was established while Debtor was an insider. N.Y. Debt. & Cred.Law § 282(2)(e)(i) (McKinney Supp. 1986); (Code § 522(d)(10)(E)(i)). The Trustee contends Debtor has failed to prove the funds in the Plan are necessary for his support or that of his dependents. In a reply memorandum, (filed September 23, 1986), the Trustee, for the first time since his objection was filed, contends that a hearing is necessary to resolve the issue of the Plan's relationship to the Debtor's support.[2]
Debtor argues that all three provisions of N.Y. Debt. & Cred.Law § 282(2)(e)(i)-(iii) (McKinney Supp. 1986) must be met before the exemption is to be denied. Debtor states that the burden of proof is upon the Trustee to show the exemption is improperly claimed, and that in any event, the funds in the Plan are necessary for the Debtor's support. Debtor contends the Plan is not property of the estate as he had no right to withdraw funds therefrom until he either left the employ of the Mackenzie firm and thereafter attained age 59 ½ years, or retired *678 while still employed by the Mackenzie firm (Debtor's memorandum at pp. 8-10; Exhibit A). Finally, Debtor relies upon New York's scheme of "equitable distribution" for the proposition that his spouse's one-half interest in the Plan is properly excludable.
CONCLUSIONS OF LAW
The Court has jurisdiction pursuant to 28 U.S.C. § 1334 and 28 U.S.C. § 157(b)(2)(B).
Pursuant to Code § 522(b)(1), the State of New York chose to "opt out" of the Federal exemption scheme proposed under the Bankruptcy Code. 1982 N.Y. Laws § 2, Ch. 540 (McKinney 1982). New York exemptions are codified at Article 10-A, Personal Bankruptcy Exemptions, N.Y. Debt. & Cred.Law §§ 282, 283 (McKinney Supp.1986), and are the exclusive exemptions for debtors domiciled in the state. N.Y. Debt. & Cred. Law § 284 (McKinney Supp.1986).
In pertinent part, § 282 of the Debtor and Creditor Law provides:
2. Bankruptcy exemption for right to receive benefits. The debtor's right to receive: . . . (e) a payment under a stock bonus, pension, profit sharing, or similar plan or contract on account of illness, disability, death, age, or length of service to the extent reasonably necessary for the support of the debtor and any dependent of the debtor, unless (i) such plan or contract was established by the debtor or under the auspices of an insider that employed the debtor at the time the debtor's rights under such plan or contract arose, (ii) such plan is on account of age or length of service, and (iii) such plan or contract does not qualify under section four hundred one a, four hundred three a, four hundred three b, four hundred eight, four hundred nine or four hundred fifty-seven of the Internal Revenue Code of nineteen hundred fifty-four.
The New York exemption for retirement plans is taken word for word from the Federal exemption scheme, Code § 522(d)(10)(E)(i)-(iii). Consequently, the decisions of other courts which have considered the Federal exemption or a similarly worded state exemption prove insightful for resolving the Trustee's objection.
The initial question is whether the Plan is property of the estate, for only property of the estate may be claimed as exempt. Debtor contends the limitations placed upon his ability to withdraw from the Plan at the time he filed his petition removed the Plan from consideration as property of the estate.
Pursuant to Code § 541(a)(1), the commencement of a case creates an estate, comprised of "all legal or equitable interests of the debtor in property." Non-bankruptcy law will initially determine the debtor's interest in property, yet the question of what constitutes property of the estate is a federal question. Matter of Ross, 18 B.R. 364, 367 (N.D.N.Y.1982), aff'd., Regan v. Ross, 691 F.2d 81 (2d Cir.1982). The scope of Code § 541(a)(1) is very broad, with every interest of the debtor becoming part of the estate. H.R.Rep. No. 595, 95th Cong., 1st Sess. 368-67, reprinted in 1978 U.S. Code Cong. & Ad. News 5963, 6323-4 ("House Report"); S.Rep. No. 989, 95th Cong., 2d Sess. 82-3, reprinted in 1978 U.S. Code Cong. & Ad. News 5787, 5868-9 ("Senate Report"); Matter of Ross, supra 18 B.R. at 367.
The Debtor had an interest in the Plan at the time he filed his petition. This interest was 100% vested, and whatever its nature, was part of the Debtor's bankruptcy estate. Debtor's argument confuses the issue of the Plan's exclusion from property of the estate, with that of the Plan's exemption from property of the estate available for Trustee's liquidation. New York cases to date have uniformly held such plans to be part of the debtor's estate. Matter of Ross, supra, 18 B.R. at 367, 691 F.2d at 84; In re Donaghy, 11 B.R. 677 (Bankr.S.D.N.Y.1981) (pension). The argument that such plans are excluded from property of the estate pursuant to Code § 541(c)(2) was resolved by the United States Court of Appeals for the Second Circuit in Regan v. Ross, supra. In that case, the administrators for two New York *679 State administered pension funds argued that state law prohibitions against pension fund assignment to creditors, N.Y. Retire. & Soc. Sec. Law § 110 (McKinney Supp. 1986) kept pension benefits from the ambit of a Chapter 13 debtor's estate. The administrators also argued that Code § 541(c)(2) operated to bar pension funds from use in a Chapter 13 plan. In affirming the District Court, and after reviewing the legislative history surrounding the enactment of Code § 541(c)(2), the Court of Appeals restricted the applicability of the section to spendthrift trusts in particular. See, House Report, supra, at 369, 1978 U.S. Code Cong. & Ad. News at 6325; Senate Report, supra at 83, 1978 U.S. Code Cong. & Ad. News at 5869. As the Plan is clearly part of the Debtor's estate, the second inquiry is to what degree the Debtor's interests therein are exempt as a matter of law.
The Trustee contends that because the Plan was established by an "insider", under the terms of Debt. & Cred.Law § 282(2)(e)(i) (McKinney Supp. 1986), the Plan is not exempt. The New York statute does not define an "insider", yet because the language of the exemption was taken verbatim from the Code, reference to the definitional provisions of the Code is warranted.
Concerning an individual debtor, Code § 101(28)(A) defines an insider as:
(i) [a] relative of the debtor or of a general partner of debtor;
(ii) [a] partnership in which the debtor is a general partner;
(iii) [a] general partner of the debtor; or
(iv) [a] corporation of which the debtor is a director, officer, or person in control;
. . .
The Debtor was a partner with the Mackenzie firm when his rights under the Plan arose. As such, the Plan was "established by or under the auspices of an insider that employed" the Debtor. However, the Trustee misconstrues the New York exemption statute, for all three qualifying provisions thereunder must be present in order to deny the claimed exemption. The Court reads the three subsections of the New York exemption statute in the conjunctive, for the word "and" is used to express joint interpretation. See, People v. Donner, 106 Mis.2d 779, 781 n. 1, 435 N.Y.S.2d 225 (N.Y.Sup.Ct.1980).
Consequently, in addition to insider involvement with the Plan's establishment, the Trustee must prove that Plan payments are made on account of age or length of service, and also that the Plan fails to qualify under the stated provisions of the Internal Revenue Code. Plan payments to Debtor are admittedly payable on account of his age or length of service, but the evidence adduced indicates the Plan qualifies under the Internal Revenue Code. (Debtor's memorandum, Exhibit D). The Trustee does not therefore, prevail on his argument that the Plan is technically deficient under N.Y. Debt. & Cred. Law § 282(2)(e)(i)-(iii) (McKinney Supp. 1986).
The crux of the Trustee's objection to the Plan's exemption is that it is not "reasonably necessary for the support of the debtor or any dependent of the debtor." The Trustee, as objector to the claimed exemption, bears the burden of proof. Fed.R.Bankr.P. 4003(c). In re Schlee, 60 B.R. 524, 528 (Bankr. D.Minn.1986). Contra, In re Montavon, 52 B.R. 99, 102 (Bankr. D.Minn.1985). The Trustee must show by a preponderance of the evidence that the debtor has not properly claimed the exemption. In re Brooks, 60 B.R. 155, 159 (Bankr. N.D.Tex.1986).
The leading case interpreting the "reasonably necessary" language of the federal exemption is Warren v. Taff (In re Taff), 10 B.R. 101 (Bankr.D.Conn.1981). The Taff court thoroughly analyzed the reports and proposed uniform exemption laws considered by both the House and Senate in drafting a list of federal exemptions for the Code. This review led the Taff court
to conclude that the reasonably necessary standard requires that the court take into account other income and exempt property of the debtor, present and anticipated . . . and that the appropriate amount to be set aside for the debtor ought to be sufficient to sustain basic needs, not related to his former status in *680 society or the lifestyle to which he is accustomed but taking into account the special needs that a retired and elderly debtor may claim.
Id. at 107.
As noted by another New York bankruptcy court, the special treatment afforded pension benefits under state and federal law stems from the view that such funds are in the nature of future earnings, immune from the claims of post-petition creditors, and are part of the debtor's "fresh start". In re Donaghy, supra, 11 B.R. at 679-80.
Some courts have restricted inquiry to consideration of a debtor's present needs only; this analysis is justified by reference to the present tense phrasing of the exemption statute. Thus, in Matter of Kochell, 26 B.R. 86 (Bankr.W.D.Wis.1982), aff'd., 732 F.2d 564 (7th Cir.1984), the bankruptcy court denied a 43 year old debtor's claimed pension fund exemption where the debtor was not currently drawing on the funds, and his monthly budget indicated a surplus of $1,500.00 of income over expenses. The debtor had urged the court to broadly construe the federal exemption scheme by taking into account his needs and those of his dependents over the long run, particularly the possibility that his death or disability would jeopardize the education of his three children. The Kochell bankruptcy court, noting that a new pension could easily be re-established, rejected this plea:
Although the exemption provisions of 11 U.S.C. § 522 should be broadly construed in favor of the debtor, the purpose of the exemptions is to protect the fresh start of the debtor following bankruptcy, not to insure that no future misfortune could possibly lower the standard of living to which the debtor's dependents have become accustomed.
Id. at 87.
Similarly, in In re Clark, 18 B.R. 824 (Bankr. E.D.Tenn.1982) aff'd., Clark v. O'Neill, 711 F.2d 21 (3d Cir.1983), focus was upon a debtor's present needs, for an exemption of future payments "demonstrates a concern for the debtor's long-term security which is absent from the statute". Clark v. O'Neill, supra, 711 F.2d at 23. The United States Court of Appeals for the Third Circuit therefore affirmed the bankruptcy court's denial of a claimed exemption for a 43-year old debtor's Keogh retirement plan.
A reading of these cases reveals the factual inquiry was heavily influenced by the relatively young ages of the debtors, coupled with future earning potential sufficient to re-fund a pension account for retirement. See, In re Kochell, supra, 732 F.2d at 564-65. Under different facts, the result has been to allow an exemption for at least a portion of the pension funds.
Thus, this was the result for all of a lump sum distribution from a pension plan received prior to the bankruptcy filing where the unemployed debtor was 62 years old, stricken with emphysema, had an uncertain employment future, and whose 64 year old spouse had substantial cancer-related bills. In re Donaghy, supra. The Donaghy court noted the pension fund was debtor's only income source, aside from disability benefits. Medical bills, as well as food, clothing and shelter costs were viewed as increasingly burdensome expenses, thus warranting the claimed exemption. The Taff decision, supra, was cited for the proposition that "[t]he special needs of retired, infirm and elderly debtors should be taken into account." In re Donaghy, supra, 11 B.R. at 680.
Similarly, in In re Schlee, 60 B.R. 524 (Bankr.D.Minn.1986), the bankruptcy court held substantial Keogh account holdings exempt where the 56 year old debtor had a limited future income stream below that of anticipated "basic" monthly expenses. Likewise, the bankruptcy court in In re Miller, 33 B.R. 549 (Bankr.D.Minn.1983), referencing Congressional intent that pension "benefits are akin to future earnings of the debtor", concluded that debtor's future retirement needs could be considered in determining the exemption. Id., at 552-53 citing, House Report, supra, at 362, 1978 U.S. Code Cong. & Ad. News at 6318.
The Court's task is somewhat hampered by the Trustee's failure to proceed at *681 an evidentiary hearing on this matter. While the Trustee has of late requested a hearing, his prior actions have clearly evidenced a waiver of the right to have the matter set for hearing. It would be prejudicial to the Debtor's interests to accede to the Trustee's request at this time, nearly one year after the objection to the claimed exemption was first filed. Consequently, the Court is, to a large extent, left to rely upon the factual representations of the Debtor and his counsel in the documents which have been previously filed. The Court does not view Debtor's circumstances in a vacuum, and additionally takes into account the realities of the world. Debtor is 60 years of age. As an attorney licensed to practice law in New York State, Debtor is not tied to any pre-ordained retirement age. While the Court does not suggest the Debtor must continue working until he is no longer physically and mentally capable, this is not a case where a debtor may be said to have a finite number of working years remaining. Indeed, one need only review the current membership of the United States Supreme Court to realize that professional vitality and viability extends far beyond age 65. Debtor has no known health problems limiting his ability to generate income, presently at a net figure of just under $3,000.00 per month. His spouse is unemployed, and presumably will remain so in the future. While the record is unclear whether the children residing in the home are the Debtor's legal "dependents", the Court presumes that the age of emancipation for each cannot be far off, if indeed it has not yet already been reached. Debtor will presumably receive social security payments upon retirement, although no evidence was presented in this regard.[3]
Debtor's current income is more than adequate to provide for the basic needs of his dependents and himself. His monthly expenses are high, yet many of those listed do not constitute factors to be considered as part of one's basic needs. Debtor has not reaffirmed the automobile debt, thus freeing $391.00 per month. Debtor has presumably listed his residence for sale, and thus associated expenses will be drastically reduced upon sale, with Debtor receiving the sum of $10,000.00 as his homestead exemption. By Debtor's own reckoning, there is a considerable equity in the home. Debtor currently contributes $2,400.00 per year towards his in-laws' rent; such payments, absent substantially more compelling proof, are surely no part of his basic needs. The Court similarly views the $1,200.00 yearly expenditure on vacations and gifts, particularly when a like amount is earmarked for Debtor's entertainment.
By Debtor's own admissions, his income is sufficient to meet his family's basic needs at present. As his monthly expenses are reduced, the monies previously used to meet the same may be used to fund a future retirement plan. While the Debtor's age is not a factor weighing in his favor, he is not, as indicated, bound to a finite number of remaining working years.
The Court's task is to sustain the Debtor's basic needs, yet not at the level to which he had been accustomed, or to the level of the demands of his previous lifestyle. When all factors are considered, the Court believes 30% of the funds currently held on account are exempt and beyond the reach of the Trustee. At a minimum, the Court notes that Debtor has at least $3,600.00 per year in income (currently associated with in-laws' rent and vacations and gifts), which could be used to fund a new retirement plan. This figure does not take into account monies available from reduced housing and transportation expenses, as well as those associated with the "support" of Debtor's non-dependent children. The funds held exempt may likewise be reinvested to provide for the retirement of Debtor and his spouse. When these funds, those received as part of the claimed homestead exemption, and those to be received in the future as part of a continued income stream, are added together, sufficient *682 funds exist to provide for the basic needs of the Debtor and his dependents.
As a final note, Debtor's reliance upon the New York equitable distribution scheme, N.Y.Dom.Rel.Law § 236B (McKinney Supp. 1986) is misplaced. Other than in the context of a divorce, Debtor's spouse has no present legal interest in the Plan simply by virtue of marriage. See, Henry v. Castagnaro, 106 Misc.2d 574, 580-81, 434 N.Y.S.2d 592 (N.Y.Sup.Ct.1980).
It is thus
ORDERED:
The pension funds listed as exempt property on Debtor's B-4 Schedule are exempt to the extent of 30% of the funds currently held on account pursuant to the Court's Order of May 5, 1986. The Trustee shall collect the remaining 70% of the funds as nonexempt assets of the estate.
NOTES
[1] By Order dated May 5, 1986, Debtor was authorized to transfer the amount remaining in the Plan to an individual retirement account supervised by Dean Witter Reynolds, Inc. The funds in this account were not to be released to Debtor's use until further order of the court, and/or final determination of the Trustee's objection to the claimed exemption.
[2] The record should reflect that the Trustee's objection was originally filed on January 23, 1986, and the matter set for initial hearing on February 18, 1986. The Trustee requested an adjournment to March 18, 1986. On that date, the Trustee and Debtor's counsel requested an adjournment to April 29, 1986. On that date, the parties indicated that the matter would submitted upon the memoranda of counsel. A deadline of May 13, 1986 was set for receipt of Trustee's memorandum, and that of May 20, 1986 for Debtor's. By letter dated May 14, 1986, the Trustee requested an extension until June 2, 1986 for the filing of his memorandum as the dispute was near settlement. A memorandum was filed on June 3, 1986. Debtor's counsel requested an extension to file by June 17, 1986; this was granted, and then further extended to June 23, 1986. Debtor's counsel then requested an extension to July 3, 1986, due to the anticipated receipt of pertinent evidence. This deadline came and went, with Debtor's counsel thereafter seeking an extension to July 28, 1986; the Trustee acquiesced, if the memorandum was received no later than August 4, 1986. Debtor's counsel informed the Court on August 1, 1986 that the memorandum would be filed in a day or so. On August 25, 1986, Debtor's counsel indicated the document would be filed no later than August 29, 1986. The Trustee agreed to this deadline. The memorandum was not received, and by letter dated September 3, 1986, the Court informed the parties the matter was submitted as of that date, and that no further documentation would be considered. Debtor's counsel filed his memorandum on September 9, 1986, with the Trustee consenting to the Court's receipt and consideration of the document. The Trustee filed a reply memorandum on September 23, 1986.
[3] The Court notes that such benefits are not designed to provide primary support for retired persons.
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UNPUBLISHED ORDER
Not to be cited per Circuit Rule 53
United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
January 30, 2006
Before
Hon. RICHARD D. CUDAHY, Circuit Judge
Hon. DANIEL A. MANION, Circuit Judge
Hon. DIANE P. WOOD, Circuit Judge
No. 04-1996
UNITED STATES OF AMERICA, Appeal from the United States District
Plaintiff-Appellee, Court for the Northern District
of Indiana, South Bend Division.
v.
No. 3:03 CR 83
ERIC J. JOHNSON
Defendant-Appellant. Robert L. Miller, Jr., Chief Judge.
ORDER
Eric Johnson pleaded guilty to possession with intent to distribute more than
50 grams of cocaine base. He raised only one issue on appeal before this court, which
was whether his Sixth Amendment rights were violated when he was sentenced to 210
months in prison under the then-mandatory Sentencing Guidelines. We directed a
limited remand pursuant to the procedures set forth in United States v. Paladino, 401
F.3d 471 (7th Cir. 2005). The district court has informed us that it would impose the
same sentence under the now-advisory Guidelines. In so doing, the district court
clearly and thoroughly evaluated all of the factors under 18 U.S.C. § 3553 and
determined that Johnson’s “stunning criminal record,” “the need for the sentence to
No. 04-1996 Page 2
reflect the seriousness of the offense and to provide just punishment and to promote
respect for the law, [and] the need to protect the public from Mr. Johnson” justify his
sentence of 210 months, the bottom of the properly calculated sentencing range.
Sentencing ranges properly calculated under the Guidelines are presumptively
reasonable, see United States v. Mykytiuk, 415 F.3d 606 (7th Cir.2005). Both Johnson
and the government had the opportunity to file memoranda about the reasonableness
of Johnson’s sentence, in light of the district court’s statement. The government took
advantage of that invitation, arguing that the sentence is reasonable, particularly in
light of Johnson’s criminal history and the amount of crack he possessed (87.53 grams).
Johnson did not file a response and therefore has not rebutted the presumption of
reasonableness. Nor does our independent review suggest that the sentence is
unreasonable.
The judgment is therefore AFFIRMED.
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439 S.W.2d 378 (1969)
Alvin S. WEXLER, Appellant,
v.
GIBRALTAR SAVINGS ASSOCIATION, Appellee.
No. 222.
Court of Civil Appeals of Texas, Houston (14th Dist.).
March 5, 1969.
*379 Jack C. Blakley, James G. Cowen, Houston, for appellant.
Charles E. Williams, Houston, for appellee.
SAM D. JOHNSON, Justice.
This was an action on a note and guaranty agreement wherein plaintiff's motion for summary judgment was granted by the trial court. The judgment was in favor of the appellee, Gibraltar Savings Association, against the appellant, Alvin S. Wexler, and was in the sum of $167,038.42, together with interest and attorney's fees.
Appellant brings only one point of error, that being that the trial court erred in granting appellee's motion for summary judgment in that neither the original nor a sworn copy of the note in issue was attached to either appellee's pleadings or motion for summary judgment, and, therefore, his general denial was sufficient to raise an issue of whether the appellee was still the owner and holder of the note sued upon.
On or about July 1, 1964, Primrose Manor, Inc., executed a note in favor of appellee for the sum of $500,000.00. Such note was secured by a deed of trust conveying in trust certain real property in Harris County, Texas. The payment of such note was further secured by the full written guaranty of appellant. Primrose defaulted in the payment of the note and appellee declared the entire balance due and owing. The property standing as security for the note was sold at trustee's sale to the highest and best bidder, who was the appellee.
Cause No. 720,515 (the first suit) was filed against the appellant and W. W. Cordes to recover such deficiency. Thereafter, plaintiff agreed to declare the trustee's sale to be ineffectual and to reinstate the loan so as to return it to its former status. A motion to dismiss such suit against appellant and W. W. Cordes was filed and an order of non-suit with prejudice was entered by the court. Thereafter, no effort to satisfy the unpaid balance then owing to appellee on the note was made by appellant or Primrose.
Appellee once again sold the property at foreclosure sale. This sale resulted in a deficiency of $167,038.42. Cause No. 729,974 (the second suit) was then filed to recover such deficiency and interlocutory judgments of default against W. W. Cordes and Primrose were thereafter entered by the court below.
Appellant and W. W. Cordes then filed Cause No. 730,515 (the third suit) which was a separate action against appellee. Appellee's first supplemental answer included an affidavit of Milton W. Cowden.
Three separate actions were then on file involving common questions of law and *380 fact. Appellee moved to consolidate these suits and the court below entered its order consolidating them. Following the order of consolidation appellee filed its motion for summary judgment which was supported by the affidavits of Milton W. Cowden and Edgar W. Monteith. The litigation between the parties was in this posture when appellee's motion for summary judgment was granted.
A photographically reproduced copy of the note was attached to appellee's original petition in Cause No. 720,974 (the second case). Further, the note was described in detail, referred to and expressly incorporated by reference in appellee's original petition. Appellant's original petition in Cause No. 730,515 (the third case) likewise had attached a photographically reproduced copy of the note, and the note was further expressly referred to and incorporated in appellant's original petition.
The affidavit of Milton W. Cowden states, "I have carefully read the allegations set out in Plaintiff's Original Petition in Cause No. 729,974 styled Gibraltar Savings Association vs. Alvin S. Wexler et al and I state that of my own personal knowledge, all of the allegations of fact therein contained are true and correct and I expressly incorporate said Plaintiff's Original Petition in said Cause No. 729,974 and the above First Supplemental Answer herein and adopt the same in this my sworn Affidavit as if set out herein in full." The affidavit of Edgar W. Monteith also states, under oath, that all of the allegations, statements and facts pleaded therein are true and correct and that he expressly adopted same as his sworn affidavit.
We are of the opinion that the photographically reproduced copy of the note in issue was verified by the affidavits of Cowden and Monteith in accordance with the requirements of Rule 166-A of the Texas Rules of Civil Procedure.
Moreover, at the time of the hearing on appellee's motion for summary judgment the original of said note was on file with the papers of this cause and so remains at this time. The original note was expressly reviewed and considered by the trial judge in granting appellee's motion for summary judgment.
In support of his contention appellant cites three cases: Alexander v. Houston Oil Field Material Co., Tex.Civ.App., 386 S.W.2d 540; Sidran v. Tanenbaum, Tex. Civ.App., 391 S.W.2d 93; Barney v. Credit Plan Corp., Tex.Civ.App., 403 S.W.2d 230. In each of these cases neither the petition nor the attached copy of the note was sworn to or supported by affidavit. In each of these cases the motion was not sworn to or was not supported by affidavit or any other extrinsic evidence.
A very recent and strikingly similar case to the one at bar is Womack v. I. & H. Development Co. (Amarillo, Tex. Civ.App.1968), 433 S.W.2d 937, no writ hist. This was likewise a summary judgment case and one in which unsworn reproduced copies of the notes in issue were attached to the petition. The Court there stated, "The contention is made no proof of the notes was made because neither the originals or certified copies were attached to the pleadings or the motion for summary judgment. * * * In the instant case, reproduced copies of the notes were attached to the amended petition. The amended petition, motion for summary judgment, and Hipes' affidavit referred to and incorporated the copies of the notes by reference. The contents of the notes are in the record. There was no exception in the trial court relating to the failure to attach the original or certified copies of the notes in question. Where unverified or uncertified copies are attached to pleadings or a motion for summary judgment and no exception is taken, the party thereby waives the requirement under Rule 166A(e) and the copies are a sufficient basis to grant a motion for summary judgment when it fairly appears there is no genuine issue as to a material fact and that the moving party is entitled to a judgment as a matter of law. Youngstown *381 Sheet & Tube Company v. Penn, 363 S.W.2d 230 (Sup.Ct.). Farmers & Merchants Compress & Warehouse Company v. City of Dallas (Tex.Civ.App.) 335 S.W.2d 854, 856 (Ref.N.R.E.). Schoolcraft v. Channel Construction Company (Tex.Civ. App.) 397 S.W.2d 256 (Ref.N.R.E.). It is further noted appellants admitted the execution of the notes in their sworn answer. Such allegation constitutes a judicial admission and is construed against appellants. Yelverton v. Brown (Tex.Civ. App.) 412 S.W.2d 325. McCormick v. Stowe Lumber Company (Tex.Civ.App.) 356 S.W.2d 450 (Ref.N.R.E.). We therefore conclude the notes were properly in evidence before the court. * * * Appellants' answer admitted execution of the notes and alleged they had made certain payments to appellee and had received credits for the same. Appellants did not deny liability to appellee, but prayed they be allowed credit on the principal of the notes as they had alleged. Appellee's pleadings and motion alleged the notes were past due. The Hipes affidavit reaffirmed all credits to appellants on said notes had been applied as alleged in their amended petition. These allegations, together with appellants' admission of execution and claim of credits are uncontradicted evidence the notes were past due."
In the instant case appellee's original petition in Cause No. 729,974 (the second case filed) verified by the above described affidavits, expressly stated that it was acting pursuant to the authority given to the holder of said note by the terms thereof and that all just and lawful credits, offsets and payments had been allowed. In the instant case appellant acknowledged and admitted appellee's ownership of the note sued upon in his original petition in Cause No. 730,515 (the third case filed).
The reasoning of the Amarillo Court of Civil Appeals quoted above is particularly applicable case at bar and is adopted. Appellant's point of error is overruled and the judgment of the trial court is affirmed.
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224 Kan. 654 (1978)
585 P.2d 999
INTERNATIONAL VILLAGES, INC., OF AMERICA and SIMEDO ENTERPRISES, INC., and LEONARD M. SLATER and EVELYN V. SLATER, Appellants,
v.
BOARD OF COUNTY COMMISSIONERS OF JEFFERSON COUNTY, et al., and PLANNING COMMISSION OF JEFFERSON COUNTY, KANSAS, et al., Appellees.
No. 48,892
Supreme Court of Kansas.
Opinion filed October 28, 1978.
Kenton C. Granger, of Anderson, Granger, Nagels and Lastelic, Chartered, of Overland Park, argued the cause and was on the brief for the appellants.
Gary L. Nafziger, County Attorney, argued the cause and was on the brief for the appellees.
The opinion of the court was delivered by
McFARLAND, J.:
This is an appeal from the judgment of the district court affirming the denial by a regional planning commission of appellants' applications for conditional use permits.
In its memorandum of decision the trial court made detailed findings as to the exact nature of the desired use of the property. These findings are not in dispute. The portion of the decision relevant to this appeal is as follows:
"International Villages has options to purchase land from other plaintiffs for the purpose of construction and operation of a recreational vehicle (called RV) campground, for pull type house trailers, self-contained and otherwise, 5th wheel trailers, motor homes, campers, pop-up tents, and the like.
"This land is zoned residential and agricultural. A conditional use permit is required to operate the proposed facility. The Planning Commission, after hearing, denied issuance of the conditional use permits and Plaintiffs appeal to this court. Plaintiffs claim the action of the Planning Commission was unreasonable, arbitrary, capricious and unlawful.
"Land on which this campground is proposed is bounded on three sides by land owned by the Corps of Engineers of the United States Government in connection with Perry Reservoir. International Villages seeks to operate under a franchise from Jellystone, which is a national organization for this type of facility, and which bears a good reputation, according to the evidence. International Villages *655 (called International) has financing capability of at least $2,500,000.00, and has sufficient financial ability to carry out its plans, if permitted to do so.
"The area involved consists of 120 acres, although some evidence shows possible expansion to 170 acres.
"The plan of International includes certain `amenities' which are said to include a `Ranger Station' which is a lounge type building, a country store, grocery store, swimming pool, miniature golf course, children's concessions, and certain `comfort stations' which the court interprets to mean rest rooms, inasmuch as `comfort stations' were not described with particularity.
"International proposes to create 1,000 camp sites on subject property, of an average dimension of 50 x 60 feet, of which 150 will be reserved for rental and 850 will be sold to individuals. Sale price for the lots will be $3,900.00, each. 25 acres will be reserved for the amenities area.
"Internal roadways and streets will be constructed, surfaced with gravel, except asphalt streets will be constructed in the amenities area. These will not be dedicated to the public.
"Water will be available in sufficient quantities from a Rural Water District. Electricity is available and sufficient.
"The sewers will be initially installed by International, and the proposal is for a non-overflow lagoon system, the initial concept of which has been approved by the State Board of Health. The proposal calls for 20% of the lots to be connected to the sewer line, 80% not connected.
"There will be four comfort stations; there will be one dump station in the central amenities area for dumping of wastes from self-contained RVs, and one dump station by each comfort station.
"International will retain ownership of the income producing amenities, and the 15% of the camp sites for rental, although these may be sold to a third party. Ownership of lots sold will vest in the respective purchasers; ownership of the streets, sewer system, electric system, water system, comfort stations and non-income producing amenities will be owned in common by the owners of the land. Management of the property owned in common (the streets, non-income producing amenities, water, sewer system, etc.) is proposed to be undertaken by a Home Owners Association plan which will have restrictions, although such a plan is not finalized.
"Security is said to consist of a guard at the entrance to the facility.
"Entrance to the facility will be from Jefferson County Road B.
"Surveys of International indicate there are 22,000 RV campers within one hour driving time of the proposed facility, and that the 850 lots for sale can be sold within 1 1/2 to 2 years, sales to be on installment contracts for the most part.
"Surveys of International indicate the facility will contain 2,100 persons on peak days, 9,540 persons during peak weeks, and will be used 308,210 people days per year.
"At this time, there are 37 developments in the Perry Reservoir area; there are 9 Federal Public Use areas around the lake that have camping facilities, and there is one Kansas State park with camping facilities. There are over 100,000 persons in this area on peak week-ends. Access roads, Highways 92 and 16 between Tonganoxie and Ozawkie, are repeatedly clogged with boats, campers and RVs. One road, County Road B, serves the Slough Creek Area and the subject area. This road *656 is heavily traveled, and is very expensive to the County to maintain, is in bad condition, with chuck holes and deteriorating shoulders due to the volume of traffic it carries.
"By reason of the numbers of people now using this area, Jefferson County has had continual police and ambulance problems; by reason of recent regulations, the County has been required to take over all ambulances operating within the County, and the County now operates two ambulances. The expense for the Sheriff's department to the County has tripled. Expense for road maintenance has greatly increased. The County levies the maximum tax levy permitted by law, and in addition has received federal `revenue sharing' to the extent of $120,000 to $140,000.00 per year, which may or may not continue. Without this `revenue sharing' it is not possible for the County to maintain the necessary health, road maintenance, and police services now required for the present influx of persons, not including those sought to be brought in by plaintiffs. The resources of Jefferson County are now taxed, in all respects, to the limit.
"Services demanded and required for this influx of persons exceeds tax revenue generated by these developments and public use areas.
"Experience of and in Jefferson County with Home Owners Associations has been bad. This type of facility creates diverse ownership by transient people whose interest has been shown to be short-lived. Home Owners Associations operate with revenues contributed by the diverse owners who rarely participate. The history of such an Association type of management of a development in Jefferson County shows increasing problems with interior roadways and streets, sewers, water, and the maintenance thereof.
"Close to subject tract, there is a RV campground owned and operated by one Hendrix, who was granted a conditional use permit. However, the Hendrix facility is a camping facility only, and not at all similar to International's proposal. Hendrix's facility is much smaller, Hendrix owns all the land, owns all the electric and sewer facilities, owns the roadways and is personally responsible for maintenance. Hendrix is not permitted to sell lots; there is no diversity of ownership; there is no Home Owners Association.
"As correctly pointed out by plaintiffs, this is really a case involving denial of conditional use permits, and is not a zoning case. The Zoning Regulations do not permit a RV campground and the only way they can be permitted is through conditional use permit.
"Plaintiffs, in their brief, pose the controlling question thus:
`Is a commercial campground of the nature proposed by International Villages a project which sufficiently threatens the health, safety and welfare of the inhabitants of Jefferson County, Kansas, that it may properly be denied a conditional use permit?'
"Article 80.1 of the Zoning Regulations, CONDITIONAL USE PERMITS, PURPOSE, states:
`Certain kinds of uses need to be reasonably controlled by specific requirements that provide practical latitude for the investor but at the same time, maintain adequate provision for the security of the health, safety, convenience, prosperity or general welfare of the community's inhabitants. In order to accomplish such a dual objective, provision is made in these Regulations for a more detailed consideration of each conditionally permitted use as it relates to *657 location, design, size, method of operation and intensity of land use which in turn effects the volume of traffic generated and traffic movements, the concentration of population and the kinds of public facilities and services it requires. Land and structure uses possessing these particularly unique characteristics are permitted through the issuance of a Conditional Use Permit with conditions and safeguards attached as may be deemed necessary by the Planning Commission.' (Emphasis supplied.)
"Article 80.3, REVIEW BY PLANNING COMMISSION, recites, among other things:
`A. The Planning Commission shall review the proposed development as presented in the application in terms of these Zoning Regulations. .. .
`B. The Planning Commission shall find adequate evidence that such use on the proposed location:
1. Will/will not be harmonious with the general objectives of the Master Plan.
2.... .
3. Will/will not be hazardous or disturbing to existing or future neighboring uses.
4. Will/will not be detrimental to property in the immediate vicinity or to the community as a whole.
....' (Emphasis supplied.)
"In denying the application for change of zone and for conditional use permits, the Planning Commission considered the impact of International's proposal to the area financially, ecologically, the impact on county roads, the impact on county finances, the impact on the county government, and its experience with Home Owners Associations. Denial was couched in the following words:
1. Would not be harmonious with the general objectives of the Master Plan.
2. Could be hazardous or disturbing to existing and/or future neighboring uses.
3. Could be detrimental to property in the immediate vicinity or to the community as a whole.
"It is seen the use of the word `could' is in error. However, the evidence leads the Court to the conclusion that the Planning Commission's finding #1, `Would not be harmonious with the general objectives of the Master Plan,' is amply supported by the evidence. The subject area is not included in `recreational area' in the zoning map, master plan, although it is close by or adjacent.
"Plaintiff argues the Planning Commission or this Court should state under what conditions a conditional use permit will be issued to International; that it is unlawful to deny issuance of a conditional use permit outright; that nowhere in Article 80 is it stated that a conditional use permit may be flatly denied.
"A master plan is a guide to development. Bodine v. City of Overland Park, 198 Kan. 371. This, of necessity, includes the right to limit development, limit the impact on a rural community of unbearable concentrations of population in this type of facility and other facilities generated by the Perry Reservoir; this includes the right of a rural community to protect itself against ever increasing demands made in the name of recreation, demands on the people of Jefferson County, Kansas; demands for ever increasing police protection, health-ambulance services, ever-increasing tax loads generated in the name of recreation without generating equal tax revenues. Article 80.1 of the Zoning Regulations, above, recognizes these very same considerations when it speaks of `method of operation,' *658 `intensity of land use,' `volume of traffic generated,' `concentration of population,' `public facilities and services it requires.'
"Article 80.3 of the Zoning Regulations, above, states the Planning Commission reviews the `proposed development as presented.'
"The Planning Commission has ample authority, if warranted by the evidence, to deny a conditional use permit. The Court is of the opinion that a conditional use permit may be `flatly denied' if warranted by the evidence.
"Plaintiffs suggest the Planning Commission acted behind closed doors, in violation of the open meeting law. This is not supported by the evidence.
"The Court concludes plaintiffs have a right to appeal the decision of the Planning Commission to the District Court, and that plaintiffs have standing.
"The Court concludes from the evidence the action of the Planning Commission in denying change of zoning and in denial of the conditional use permits on the ground the same are not harmonious with the general objectives of the Master Plan was not arbitrary, capricious or arbitrary and was not unlawful. The decision of the Planning Commission is amply supported by competent evidence...."
The ultimate issue in the case is whether the denial of the applications for conditional permits was unreasonable. The appeal to the district court was taken pursuant to K.S.A. 19-2926 which provides:
"Any and all acts and regulations provided for or authorized by this act shall be reasonable and any person having an interest in property affected may have the reasonableness of any such act or regulation determined by bringing an action against the county commissioners in the district court of the county."
The appellants attack the judgment on both substantive and procedural grounds. To understand the issues, it is necessary to recount the manner in which this action developed.
The first hearing before the Jefferson County Regional Planning Commission on the applications was held September 23, 1975. Prior to the meeting International supplied Gerald Rose, the Planning Director, with all the data he requested. After the completion of the agenda, the Planning Commission went into "executive session." At first, the permits were approved. Later on, during the same session, the approval was withdrawn and the applications were tabled for "further study and discussion of conditions to be attached for approval." In accordance with the practice of the Planning Commission, International was not present at the "executive session." Mr. Rose advised International by letter as to what had transpired and stated he would contact International prior to the next meeting to discuss "some of the proposed conditions which will be stipulated." No such contact was made. The second hearing was held on October 28, 1975. At *659 the close of this hearing, the Commission again went into "executive session" and rejected the applications. The grounds for the denial appear in the memorandum opinion of the district court.
On appeal International attacks the manner in which the Planning Commission arrived at its ultimate decision. It complains that although the Planning Commission consists of seven members, only three of the members were present at both meetings. There is no showing that the Commission lacked a quorum at either meeting, but, rather, that some members were present at one meeting that were not present at the other meeting. This point is without merit.
International next contends that the "executive sessions" violated the Open Public Meetings Act, K.S.A. 75-4317, et seq. Subsequent to the meetings herein, K.S.A. 75-4318 was amended to exclude bodies deliberating matters relating to a decision involving quasi-judicial functions. Zoning change applications were held to be quasi-judicial in nature in Golden v. City of Overland Park, 224 Kan. 591, 584 P.2d 130 (1978). There is some dispute as to whether International was excluded from attending the "executive sessions." Whether or not the "executive sessions" violated the Public Meetings Act does not void the actions taken and appellants raise the question only as evidence of "unreasonableness." The record has been reviewed and there is no showing the purpose of such sessions was to defeat or defraud International. The procedure of the Planning Commission was quite informal, but this does not vitiate its actions.
International contends that the Planning Commission did not have authority to issue flat denials of the applications. It contends it should have had an opportunity to comply with conditions or negotiate objected-to elements of the project. In support of this contention it cites Section 80.3 of the Jefferson County Zoning Regulations as follows:
"C. The Planning Commission shall require as conditions of approval any other requirements, including guarantees that any conditions will be fulfilled, that it deems necessary to fulfill the intent of these Regulations."
Under this rationale, an application to establish a bawdy house could not be flatly denied. A planning commission may deny an application for a conditional use permit without stating any conditions for approval. If the applications for conditions are granted, then the approval may be conditioned on certain requirements *660 being complied with. An application may be denied in toto.
International next complains that the trial court considered evidence not before the Planning Commission.
The rules on reviewing evidence are summarized in Olathe Hospital Foundation, Inc. v. Extendicare, Inc., 217 Kan. 546, 539 P.2d 1 (1975):
"On judicial review a court may receive evidence which was not presented to an administrative agency where such evidence is relevant to the limited issues before the court. However, a party appearing before an administrative body cannot produce his evidence piecemeal; i.e., he cannot produce part of his evidence before the administrative agency and then produce the balance on judicial review." (Syl. 7.)
This court further elaborated in that decision at 560:
"In Rydd [v. State Board of Health, 202 Kan. 721, 451 P.2d 239 (1969)] we said:
`... The trial in district court then is de novo in the sense the court may take its own evidence and is not necessarily limited to the evidence presented before the administrative board. The power to receive and consider such evidence, however, is not to be employed for the purpose of enlarging the scope of judicial review the test being the evidence must be relevant to the limited issue before the court on appeal.... (202 Kan. at 732.)
This principle is subject to the important qualification that `a party appearing before an administrative body cannot produce his evidence piecemeal. He cannot produce part of his evidence before an administrative agency and then produce the balance on judicial review.' (Strader v. Kansas Public Employees Retirement System, 206 Kan. 392, 402, 479 P.2d 860.)
"In Keeney [v. City of Overland Park, 203 Kan. 389, 454 P.2d 456 (1969)] we said:
`... Parties attacking the reasonableness of an ordinance should not be precluded from the presentation of relevant evidence showing unreasonableness, even though such evidence was not presented to the governing body. This is not meant to imply that the hearing in district court should be a retrial on the merits of the zoning application, irrespective of whether or not a record was made of the city council's proceedings; neither does it imply that a party may lie in wait and ambush the other side at the district court hearing. The district judge remains armed with his usual discretion in admitting or rejecting evidence, and his rulings will not be disturbed unless substantial rights of a party are thereby affected.' (203 Kan. at 394.)"
The trial court may take additional evidence that is relevant to the limited issues of reasonableness and legality of the order appealed from. Keeney v. City of Overland Park, 203 Kan. 389, 394, 454 P.2d 456 (1969); Rickard v. Fundenberger, 1 Kan. App.2d 222, 563 P.2d 1069 (1977).
Much of the objected-to "new" evidence relates to testimony of *661 Planning Commission members as to what was considered by them in denying the applications. International, itself, presented evidence not before the Planning Commission. No abuse of discretion is shown in the admission of evidence.
This brings us to the ultimate issue of whether or not the denial of the applications for conditional use permits was unreasonable.
The trial court upheld the denials on the ground that there was ample evidence to support the Commission's conclusion that the project "[w]ould not be harmonious with the general objectives of the Master Plan."
From the findings of the trial court, which are supported by substantial competent evidence, the picture develops of a quiet county with a rather stable population which is suddenly "host" to thousands of transient pleasure seekers. This transformation arose by the creation of Lake Perry. County resources to handle such masses of humanity are stretched to the limit. The primary reason for the denial appears to be a concern about 850 landowners of temporary occupancy who own lots to be used for recreational purposes. Permanent structures and actual residency are not the purposes of ownership. Instead, the owners would use the lots as temporary locations for R.V. vehicles. Yet, these same lot owners are to be financially responsible for the maintenance of the streets, sewer system, water system, comfort stations, and other non-income producing amenities of the large project. The "Home Owners Association" is to collect sufficient sums from the 850 lot owners and International (for the unsold 150 lots) to maintain these public areas. Concern for the efficacy of such a system and the financial impact on the county if the system does not function is a legitimate concern. Under the totality of the circumstances, the denial of the applications was not unreasonable.
Other points raised are considered and found to be without merit.
The judgment is affirmed.
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532 So.2d 470 (1988)
In the Matter of the SUCCESSION OF Nathalie Lowe FLOWERS.
No. CA 87 0857.
Court of Appeal of Louisiana, First Circuit.
October 12, 1988.
Writ Denied December 9, 1988.
Doris G. Rankin, Baton Rouge, for plaintiff-appellant Hazel Lowe Kelley.
Hampdon R. White, Baton Rouge, for defendant-appellee First Presbyterian Church of Baton Rouge.
Before EDWARDS, SHORTESS and SAVOIE, JJ.
EDWARDS, Judge.
In this appeal we are faced with three main issues arising out of the interpretation of the decedent's will:
*471 (1) Was there a prohibited substitution in the will thus rendering the disposition to the church invalid?
(2) Did appellant, as sole heir, judicially confess to the judgment of possession, thus eliminating her right to attack the confession?
(3) Was there a conflict of interest by the succession attorney who also represented the sole heir and a disputed legatee regarding the disposition of immovable property.
Testatrix, Natalie Lowe Flowers, died testate on January 1, 1985 in Baton Rouge, Louisiana. Her holographic last will and testament provided for the following:
First: I desire that all my just debts are paid.
Second: I will and bequeath unto my beloved sister, Hazel Lowe Kelley, all of the residue of my property, of which I may die possessed, both real and personal, wherever situated, making her my universal and residuary heirIn the event of my sister's death after mine, the home at 4716 Highland Rd. Baton Rouge, LouisianaI do hereby will bequeath said residence to the First Presbyterian Church North Blvd. Baton Rouge, La. to be known as the Margaret L. Williams home. (Emphasis added)
After her sister's death, Hazel Lowe Kelley contacted Baton Rouge attorney Carlos G. Spaht to help settle her sister's estate. Mrs. Kelley retained Mr. Spaht at the suggestion of Rev. Ricks, a minister at the aforementioned presbyterian church of which she was a member. Mrs. Kelley was unaware that Mr. Spaht was also on the church's Board of Trustees and had been appointed by the church to represent it in the succession.
Mrs. Kelley testified that she and Mr. Spaht retrieved her sister's will from a safe deposit box and that without reading the will to Mrs. Kelley, Mr. Spaht left for his office. Mr. Spaht later contacted Mrs. Kelley to sign some papers. On January 13, 1985, Mrs. Kelley signed the affidavit of verification for the petition to probate the will. On January 23rd, the will was ordered recorded and executed by a District Court Judge. On February 8th, Mrs. Kelley and Mr. Spaht, acting on behalf of the Board of Trustees of the First Presbyterian Church of the City of Baton Rouge, both signed a petition for possession of the estate of decedent. The petition acknowledged that the reference in the will bequeathing the residence to the church was intended to give the church the naked ownership of the decedent's one-half interest in the property, subject to the usufruct for life in favor of Mrs. Kelley. On February 12, 1985, just six weeks after the testatrix's death, a judgment of possession was signed ordering the church be recognized as a special legatee and sent into possession of the naked ownership of a one-half interest in the residence. The remainder of the estate went to Mrs. Kelley, including the other one-half interest in the residence which she rightfully owned as a co-owner prior to her sister's death.
On March 8, 1985, both Mrs. Kelley and Mr. Spaht, who once again was acting on behalf of the church, signed a cash deed selling the residence to a neighbor for the cash price of $66,000.00. This deed specifically provided for the right of inhabitance to Mrs. Kelley for her lifetime. The proceeds of the sale were split in half with Mrs. Kelley and the church each receiving $33,000.00. The church's $33,000.00 was placed in a certificate of deposit with the interest to be credited to Mrs. Kelley's account.
Mrs. Kelley testified that it was not until after the sale of the residence was she given a copy of the will. She then realized she thought she had been tricked and hired another attorney to contest the judgment of possession as rendered. After a trial on the matter, the trial judge rendered judgment in favor of the church and against Mrs. Kelley. It is from this judgment that Mrs. Kelley appeals.
LAW
In reviewing the will before this court it is apparent that although the decedent intended to donate property to the church, she clearly attempted to do so in a prohibited *472 fashion. Louisiana Civil Code Article 1520 reads as follows:
Substitutions are and remain prohibited, except as permitted by the laws relating to trusts.
Every disposition not in trust by which the donee, the heir, or legatee is charged to preserve for and to return a thing to a third person is null, even with regard to the donee, the instituted heir or the legatee.
What is and what isn't a prohibited substitution is not always an easy issue to decide. The courts are asked to interpret the language without the benefit of the presence of the testator. While it is incumbent upon the court to interpret a will in such fashion so that it may be given effect if at all possible, it is also incumbent upon the court to interpret the will as written and not what the court thinks the testator intended to say. Succession of Martin, 262 So.2d 46 (La.App. 1st Cir.), cert. denied, 262 La. 472, 263 So.2d 729 (1972).
The disputed portion of decedent's will is the phrase, "In the event of my sister's death after mine, the home at 4716 Highland Rd. Baton Rouge, La. I do hereby will bequeath said residence to the First Presbyterian Church, North Blvd., Baton Rouge, La....." Prior to this phrase, the testatrix clearly willed and bequeathed all of the residue (after paying her debts first) of her property, both real and personal to her sister, Mrs. Kelley, thus making her the universal and residuary heir/legatee. We are asked to decide whether the disposition, as written, to the church is a prohibited substitution.
We must start from the beginning of both the will itself and the origin of ownership of the home itself. The decedent, Nathalie Lowe Flowers, and Mrs. Kelley were sisters and the only children of their parents. Mrs. Flowers was married once, divorced, and had no children of this marriage. Thus at the death of their parents, Mrs. Flowers and Mrs. Kelley each owned, in indivision, a one-half interest in the property.
At Mrs. Flowers' death, without any forced heirs, the legatee(s) named in her will obtained seizin of the properties left in her estate. Her will states that her bills are to be paid first and then all of her property both real and personal should go to her sister, Mrs. Kelley. It then states, "In the event of my sister's death after mine", and goes on to, "will bequeath", the home to the church. In forming a congruent interpretation of the will and the ownership of the property we find the following occurred. At Mrs. Flowers' death, her real property which consisted of only the one-half ownership of the residence, was inherited by Mrs. Kelley as per the will. Thus Mrs. Kelley then had full ownership of the residence. We interpret the phrase, "In the event of my sister's death after mine", to mean, "when my sister then dies after me ...". This is an attempt by the decedent to give ownership to one, to have and to hold for a lifetime, and then to will it to yet another. This clearly fits the LSA-C.C. art. 1520 definition of a prohibited substitution.
In Maddox v. Butchee, 203 La. 299, 14 So.2d 4 (1943), the supreme court found the following language to be a prohibited substitution, "At my Death I donate and bequeath all the property I then own to my husband Wesley Maddox after his death it is to go to my great niece Johnnie Tilley". We find no distinction between this language and the expression in the decedent's will before us.
Further, testatrix's bequest to the church violates LSA-C.C. art. 1639 in that she is attempting to give full ownership of the residence to a third party via the substitution when she only owned a one-half interest therein. See Succession of Marion, 163 La. 734, 112 So. 667 (1927).
Finding the disposition to the church to be a prohibited substitution, that portion of the will is invalidated and rendered null. Mrs. Kelley is thus the sole legatee mentioned in the will. See Succession of Walters, 261 La. 59, 259 So.2d 12 (1972).
JUDICIAL CONFESSION
The trial judge found that the decedent's will was ambiguous and that Mrs. *473 Kelley and the church compromised the ambiguity by jointly petitioning the court in the petition of possession. He held that this amounted to a judicial confession and applied the rule of law stated in Succession of Williams, 418 So.2d 1317 (La.1982). In Williams, a sister appealed a trial judgment which recognized her as heir to one-half of her mother's estate and recognized her brother's two children as the other heirs, each owning a one-fourth interest. The brother had renounced his share of the succession in favor of his children and the sister had concurred to this in the petition for possession. The supreme court stated although this split of ownership was based on erroneous legal conclusions, the sister was nonetheless precluded from asserting this error as she joined in the pleadings on which the judgment was based.
Appellant argues that this rule is not applicable for two reasons. First, Williams was based upon then LSA-C.C. art. 2291 which provided:
The judicial confession is the declaration which the party, or his special attorney in fact, makes in a judicial proceeding.
It amounts to full proof against him who has made it.
It can not be divided against him.
It can not be revoked, unless it be proved to have been made through an error in fact.
It can not be revoked on a pretense of an error in law.
The only escape from a judicial confession is through an error in fact. Appellant argues and the testimony reveals that Mrs. Kelley's vision was poor at the time of signing the pleadings. Further, that by not getting a copy of the will until after the sale of the property, she was misled into signing the documents and thus she did so under an error of fact.
Perhaps the most persuasive law on the matter can be found in Succession of LeBlanc, 128 La. 1055, 55 So. 672 (1911) and Succession of Simms, 175 So.2d 113 (La. App.1965). Both cases held that prohibited substitutions are absolute nullities and cannot be acquiesced to in a proceeding and were subject to being contested.
We find Williams, supra. to be distinguishable from the case before us, thus we hold that Mrs. Kelley did not judicially confess in the judgment finding the church a one-half naked owners of the residence.
CONFLICT OF INTEREST
Attorney Spaht testified that he read the entire will to Mrs. Kelley and that she agreed to the usufruct and in giving the church a one-half interest in the naked ownership. He further stated that he did not think there was a conflict of interest in him representing all parties involved in the succession. Pretermitting that, the testimony revealed that upon reading the will he was aware of the "unusualness" of the will's provision.
In review of the entire record we find the trial court erred in finding that the reference in the will was not a prohibited substitution under LSA-C.C. 1520. We further find that the trial court erred in applying Williams and its effect relative to a judicial confession.
Therefore we reverse the trial court's judgment insofar as it recognizes the First Presbyterian Church of Baton Rouge as an undivided one-half owner in the decedent's Highland Rd. residence. We render judgment finding that Mrs. Hazel Lowe Kelley as the sole owner of the aforementioned residence at the time of the sale to her neighbor and further order that she be recognized as the sole owner of Certificate of Deposit No. 153759 in the amount of $33,000.00, on deposit with City National Bank of Baton Rouge, representing the church's one-half proceeds from the sale of the residence.
All costs of this appeal are assessed against the appellee.
REVERSED AND RENDERED.
SHORTESS, J., concurs in the result.
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364 S.W.3d 53 (2010)
2010 Ark. 240
T.C., a Minor, Appellant,
v.
STATE of Arkansas, Appellee.
No. 09-1128.
Supreme Court of Arkansas.
May 14, 2010.
*55 Dorcy Kyle Corbin, Ark. Pub. Defender Comm'n, for appellant.
Dustin McDaniel, Att'y Gen., by: Deborah Nolan Gore, Ass't Att'y Gen., for appellee.
Steven A. Drizin, Joshua A. Tepfer, Laura H. Nirider, for amicus curiae Center on Wrongful Convictions of Youth.
ROBERT L. BROWN, Justice.
Appellant T.C., a minor, appeals from an order of the Ouachita County Circuit Court adjudicating him delinquent on the charge of second-degree murder for the death of his sister, Kaylee, and committing him to the Division of Youth Services. He raises six points on appeal: (1) that the circuit judge erred by denying his motion to suppress his statement; (2) that the circuit judge erred in finding that his statement was reliable; (3) that there was *56 insufficient evidence for the circuit judge to adjudicate him delinquent on the charge of second-degree murder; (4) that the circuit judge erred by denying his motion to dismiss based on the State's failure to provide exculpatory evidence; (5) that the circuit judge's disposition order was contrary to law; and (6) that the circuit judge violated his right to remain silent under the Fifth and Fourteenth Amendments.
On the morning of August 7, 2006, police officers of the Camden Police Department responded to a 911 call from T.C.'s residence, which he shared with his mother, Melody Jones, and his eleven-year-old sister, Kaylee. T.C. at the time was twelve years old. Upon their arrival, the police officers found Kaylee dead on her bed with her hands bound together in the front of her body with what was later determined to be a dog leash and her feet bound together with a cloth measuring tape. The police officers learned that Kaylee had been found with two plastic shopping bags over her head, which her mother had removed when she discovered Kaylee on her bed. The cause of Kaylee's death was later determined to be suffocation.
The police officers concluded that they were dealing with a potential homicide and quickly cleared and secured the residence. While police investigators processed the house for evidence, T.C. and his mother waited outside in a relative's vehicle. Some time after noon, the police officers asked the relative to drive T.C. and his mother to the Camden Police Station where it was cooler and where they would not have to witness the removal of Kaylee's body from the residence. The relative then drove T.C. and his mother to the police station where they waited in the station's break room with family.
Having discovered no evidence of forced entry into the home, the police officers returned to the police station to interview T.C. and his mother. Melody Jones was interviewed first at approximately 4:30 that afternoon, while T.C. waited in the break room with his family. Jones's interview lasted approximately one hour and was videotaped in its entirety in the station's interview room. Following Jones's interview, police officers interviewed T.C. with his mother's permission in the interview room. T.C.'s interview began at approximately 5:30 p.m.[1] Forty-five minutes into the interview, he was advised of his Miranda rights, and he signed a waiver-of-rights form. The interview continued until 6:45 p.m., when T.C. told the police officers that he was hungry. At that point, he was taken from the interview room to a detective's office, and the officers went to pick up some food for him. The portion of T.C.'s interview that occurred from 5:30 p.m. to 6:45 p.m. was videotaped by the police department.
What happened during the ensuing time period was testified to at the suppression hearing and trial by the police officers and deputy prosecuting attorney. While T.C. was eating his dinner in the detective's office, Deputy Prosecuting Attorney Gregg Parish talked with him for five to ten minutes about school, video games, and the things his sister liked. After Parish left, Officer Scott Wells spoke with T.C. about their shared interest in video games and science fiction. Officer Evin Zeek joined T.C. and Wells sometime later. After listening to T.C.'s and Wells's conversation for awhile, Zeek turned the conversation to what had happened to Kaylee the night before. According to the police officers, T.C. soon became frustrated when they *57 began to point out inconsistencies in his version of what had happened the previous night. At some point later in the conversation, T.C. asked, "If I tell the truth, what's gonna happen? Do you think I can get probation?" After the police officers told T.C. that they did not know what would happen to him, he proceeded to tell them that he had placed plastic bags over his sister's face and bound her hands and feet. During part of the time that T.C. was in the detective's office, Melody Jones was being interviewed in the interview room.
Because the interview in the detective's office was not recorded, the police officers then took T.C. back to the interview room to record his confession. The videotaped interview that followed began at approximately 10:20 p.m. with Officer Zeek again advising T.C. of his Miranda rights. After T.C. stated that he understood his rights, Officer Zeek moved on to the waiver-of-rights form and the following colloquy occurred:
OFFICER ZEEK: At the bottom is what we call a Waiver of Rights Okay, and I will read it to you quickly. It says no promises or threats have been used against me to induce me to waive rights listed above. With full knowledge of my rights, I hereby voluntarily, knowingly, and intelligently waive them and agree to answer questions. Do you understand the Waiver?
T.C.: No, what is a waiver?
OFFICER ZEEK: It simply says that what you are saying, you are doing of your own free will.
T.C.: Okay.
OFFICER ZEEK: Okay. We haven't made any promises. We haven't threatened you in any way. You are doing this because you want to do this. Okay. And again, it is by your own free will that you do this, that you make this statement.
T.C.: Yes.
OFFICER ZEEK: Do you understand that?
T.C.: Yes.
T.C. then signed the waiver-of-rights form and gave his confession.
On August 15, 2006, the State filed a petition for delinquency charging T.C. with first-degree murder for the death of his sister and moved to designate him as an extended-juvenile-jurisdiction offender under Arkansas Code Annotated section 9-27-503. Following a fitness-to-proceed evaluation in accordance with section 9-27-502, the circuit judge found that T.C. was fit to proceed and that at the time he engaged in the conduct charged he had the capacity to possess the necessary mental state required for the offense charged, to conform his conduct to the requirements of the law, and to appreciate the criminality of his conduct.
On February 13, 2007, T.C. moved to suppress his statement and alleged that it had been elicited in violation of his rights under the Fifth and Sixth Amendments to the United States Constitution; that he had not knowingly, intelligently, and voluntarily consented to giving a statement or waiving counsel due to his youth and immaturity; that his mother was not an appropriate person to consent to his questioning because she was also a suspect; and that his statement was coerced by threats from the deputy prosecuting attorney to charge him as an adult and was thus involuntary and false.
After a hearing on the matter, the circuit judge granted the State's request to have the matter designated an extended-juvenile-jurisdiction case under section 9-27-503.[2]*58 T.C. next filed a motion to reject waiver and a supplemental motion to suppress his statement, arguing, among other things, that neither his waiver nor his confession had been voluntarily, knowingly, or intelligently made; that his confession was inconsistent with the evidence and thus unreliable; and that his confession was the result of an illegal interrogation, as the police had violated Rules 2.2 and 2.3 of the Arkansas Rules of Criminal Procedure and Arkansas Code Annotated section 9-27-317(h).
On August 27, 2007, the State filed an amended petition for delinquency, reducing the charge against T.C. to second-degree murder.[3] Following pretrial hearings on August 31, 2007, and October 29, 2007, the circuit judge entered an order denying T.C.'s motions to suppress his statement and his motion to reject his waiver of rights. Specifically, the circuit judge found that the State had met its burden in proving that T.C.'s waiver of rights was freely, voluntarily, and intelligently made; that under the totality of the circumstances T.C.'s statement should not be suppressed; that T.C. understood the consequences of the waiver and that it was not the result of any coercion, force, or inducement; that T.C.'s confession was not unreliable and was given of his own free will; and that the police had not violated Rules 2.2 and 2.3 of the Arkansas Rule of Criminal Procedure or Arkansas Code Annotated section 9-27-317(h).
Following a bench trial on March 18, 19, 20, and 24, 2008, the circuit judge found T.C. to be delinquent on the charge of the second-degree murder. A disposition hearing was held on August 15, 2008, after which, T.C. was committed to the Division of Youth Services with the condition that if he was released prior to his eighteenth birthday, he would be placed on probation until his eighteenth birthday.
T.C. appealed his delinquency order and disposition to the court of appeals, and the court of appeals affirmed. See T.C. v. State, 2009 Ark.App. 604, 342 S.W.3d 832. T.C. next filed a petition for review with this court, which we granted. When we grant review, we treat the appeal as if it were originally filed in this court. See, e.g., McClanahan v. State, 2010 Ark. 39, 358 S.W.3d 900.
I. Sufficiency of the Evidence
On appeal, T.C. asserts that the circuit judge erred by failing to grant his motion to dismiss on the basis that the State failed to prove that he "knowingly" caused the death of his sister, which is an essential element of second-degree murder under Arkansas Code Annotated section 5-10-103(a)(1). Although he raises this issue as his third point on appeal, double-jeopardy concerns require this court to review his sufficiency-of-the-evidence argument first. See, e.g., Rounsaville v. State, 2009 Ark. 479, 346 S.W.3d 289.
T.C. urges that his confession was insufficient to establish that he knowingly murdered his sister and that his confession, in fact, establishes just the opposite. According to T.C., he never stated that he knew his sister had died or that he thought she had died, and he consistently denied having any intent to hurt his sister. In *59 addition, he points to portions of his confession that reflect actions he took which, he asserts, show that he did not knowingly kill his sister. For example, he underscores the fact that he told police that he held a shopping bag over his sister's head but stopped when she began to jerk, that he tied her up to slow her down from coming after him, and that he later went back to loosen the bags around Kaylee's head "so air would get in there."
Before considering the merits of this point on appeal, this court must first determine whether the issue was properly preserved for appellate review. See Maxwell v. State, 359 Ark. 335, 197 S.W.3d 442 (2004). This court treats a motion to dismiss in a bench trial as a challenge to the sufficiency of the evidence. See Law v. State, 375 Ark. 505, 292 S.W.3d 277 (2009); Springs v. State, 368 Ark. 256, 244 S.W.3d 683 (2006). Under the Juvenile Code, the Arkansas Rules of Criminal Procedure apply to delinquency proceedings. See Ark. Code Ann. § 9-27-325(f) (Repl.2009); see also Jones v. State, 347 Ark. 409, 64 S.W.3d 728 (2002).
Rule 33.1 of the Arkansas Rules of Criminal Procedure governs motions to dismiss in bench trials and provides in relevant part as follows:
(b) In a nonjury trial, if a motion for dismissal is to be made, it shall be made at the close of all of the evidence. The motion for dismissal shall state the specific grounds therefor. If the defendant moved for dismissal at the conclusion of the prosecution's evidence, then the motion must be renewed at the close of all of the evidence.
(c) The failure of a defendant to challenge the sufficiency of the evidence at the times and in the manner required in subsections (a) and (b) above will constitute a waiver of any question pertaining to the sufficiency of the evidence to support the verdict or judgment. A motion for directed verdict or for dismissal based on insufficiency of the evidence must specify the respect in which the evidence is deficient. A motion merely stating that the evidence is insufficient does not preserve for appeal issues relating to a specific deficiency such as insufficient proof on the elements of the offense. A renewal at the close of all of the evidence of a previous motion for directed verdict or for dismissal preserves the issue of insufficient evidence for appeal. If for any reason a motion or a renewed motion at the close of all of the evidence for directed verdict or for dismissal is not ruled upon, it is deemed denied for purposes of obtaining appellate review on the question of the sufficiency of the evidence.
(Emphasis added.)
This court strictly construes Rule 33.1. Grady v. State, 350 Ark. 160, 85 S.W.3d 531 (2002). Based on the language of Rule 33.1, this court has held that to preserve a challenge to the sufficiency of the evidence in a bench trial, a criminal defendant must move to dismiss at the close of the evidence. See, e.g., Maxwell, 359 Ark. at 337, 197 S.W.3d at 443. Furthermore, this court has held, in light of Rule 33.1, that the motion must be specific enough to advise the circuit court of the exact element of the crime that the State has failed to prove. E.g., Pratt v. State, 359 Ark. 16, 194 S.W.3d 183 (2004). The rationale behind this rule is that "when specific grounds are stated and the absent proof is pinpointed, the circuit court can either grant the motion, or, if justice requires, allow the State to reopen its case and supply the missing proof." Pinell v. State, 364 Ark. 353, 357, 219 S.W.3d 168, 171 (2005); see also Pratt, 359 Ark. at 23-24, 194 S.W.3d at 187-88. A general motion merely asserting that the State has *60 failed to prove its case is inadequate to preserve the issue on appeal. E.g., Beavers v. State, 345 Ark. 291, 46 S.W.3d 532 (2001).
Mindful of these standards, we turn to the motions made by the defense. At the close of the State's evidence, T.C.'s counsel made the following motion to dismiss: "The State has failed to provide sufficient evidence that [T.C.] can be adjudicated on a Second Degree Murder charge. They have not met the requisite elements for that charge." The circuit judge denied the motion. At the close of the defense's evidence, T.C.'s counsel renewed the motion to dismiss, saying: "I need to renew my motion for dismissal based on the insufficiency of the evidence. Specifically, the fact that they have failed to prove beyond a reasonable doubt each and every element of this offense." Defense counsel then proceeded to argue at length that T.C.'s confession was unreliable based on the evidence presented at trial and the circumstances under which it was taken, before concluding: "even with the statement in, there is still insufficient evidence of proof that [T.C.] intended to kill his sister."
The circuit judge denied the renewed motion to dismiss, and because the parties had waived closing arguments, took the case under consideration. A hearing to announce a decision in the case was scheduled for April 3, 2008. On April 2, 2008, T.C. filed a "Brief in Support of Motion to Dismiss," arguing, among other things, that there was insufficient evidence to establish that T.C. had "knowingly" caused the death of his sister, an essential element of second-degree murder under section 5-10-103(a)(1), which provides that a person commits murder in the second degree if the person "knowingly causes the death of another person under circumstances manifesting extreme indifference to the value of human life." A person acts "knowingly" with respect to a result of the person's conduct "when he or she is aware that it is practically certain that his or her conduct will cause the result." Ark.Code Ann. § 5-2-202(2)(B).
What is clear from the above discussion is that T.C. made general motions to dismiss at the close of the State's evidence and at the close of the defense's evidence. Neither of these motions was specific enough to advise the circuit court of the exact element of the crime that the State had failed to provethat T.C. had knowingly caused the death of his sister. Thus, neither motion preserved T.C.'s sufficiency-of-the-evidence argument on appeal. See, e.g., Pratt v. State, 359 Ark. 16, 194 S.W.3d 183 (2004).
This court has held that sufficiency-of-the-evidence challenges were not preserved when motions were made after closing arguments had begun, see McClina v. State, 354 Ark. 384, 123 S.W.3d 883 (2003); State v. Holmes, 347 Ark. 689, 66 S.W.3d 640 (2002), and when motions were made after the jury had been charged, see Rankin v. State, 329 Ark. 379, 948 S.W.2d 397 (1997); Webb v. State, 326 Ark. 878, 935 S.W.2d 250 (1996). Similarly, we conclude that a brief in support of a motion to dismiss in a bench trial that is made some days after the case is taken under advisement by the judge is untimely and does not cure a defective motion to dismiss under Rule 33.1.
In sum, T.C. failed to make a motion to dismiss at the close of all of the evidence that was specific enough to advise the circuit court of the exact element of the crime that the State had failed to prove. Though T.C.'s counsel stated that there was no proof that T.C. intended to kill his sister, counsel did not argue the failure to prove the specific element of the offense for second-degree murder, that is, that T.C. did not knowingly cause the death of *61 another person under circumstances manifesting extreme indifference to the value of human life. By the time that T.C. did raise a specific argument in his post-trial brief, it was too late. T.C.'s attempt to renew the motion to dismiss was not "at the close of all of the evidence" and was, therefore, untimely. We hold that T.C. failed to comply with Rule 33.1, and, thus, sufficiency of the evidence is not an issue preserved for our review.
II. Motion to Suppress His Confession
T.C. makes several arguments in support of his assertion that the circuit judge erred by denying his motion to suppress his confession: (1) that the Miranda warnings were not given until forty-five minutes into his first interview, and this failure tainted his later confession; (2) that the waiver of his Miranda rights was not voluntary, knowing, and intelligent; (3) that the consent of Jones to T.C.'s interview was invalid because, as a suspect, her interest was adverse to T.C.'s; (4) that the confession was the result of police coercion; (5) that the confession was the result of violation of Arkansas Rules of Criminal Procedure 2.2 and 2.3; and (6) that the confession was not reliable.
We focus initially on whether T.C.'s waiver of Miranda rights was voluntary, knowing, and intelligent. That determination involves the consideration of two components, both of which must be satisfied. See Otis v. State, 364 Ark. 151, 217 S.W.3d 839 (2005). The first component involves the voluntariness of the waiver and concerns whether the waiver was the product of free and deliberate choice rather than intimidation, coercion, or deception. Id. The second component involves whether the defendant made the waiver knowingly and intelligently and concerns whether the waiver was made with "a full awareness of both the nature of the right being abandoned and the consequences of the decision to abandon it." Id. In making these decisions, this court reviews the totality of the circumstances surrounding the waiver, including the age, education, and intelligence of the accused; the lack of advice as to his constitutional rights; the length of the detention; the repeated and prolonged nature of the questioning; the use of mental or physical punishment; and statements made by the interrogating officers and the vulnerability of the defendant. Jordan v. State, 356 Ark. 248, 147 S.W.3d 691 (2004).[4] This court will reverse a circuit judge's ruling on this issue only if it is clearly against the preponderance of the evidence. Id.
Using the totality-of-the-circumstances analysis, we conclude that T.C.'s waiver was not knowingly and intelligently made. While a defendant's youth is a factor to be considered in determining whether a juvenile knowingly and intelligently waived his or her Miranda rights, it is generally not enough, standing alone, to prove that he or she is incapable of knowingly and intelligently waiving Miranda rights. For example, in Otis v. State, 364 Ark. 151, 217 S.W.3d 839 (2005), this court held that a fourteen-year-old with a functional *62 age of nine to twelve years old had knowingly and intelligently waived his rights where officers had carefully explained what the words on the waiver form meant, where Otis had asked no questions, and where he had indicated that he understood the form. The court also noted that Otis's mother was present when he signed the form.
Similarly, in Sandford v. State, 331 Ark. 334, 962 S.W.2d 335 (1998), this court held that a sixteen-year-old with an Intelligence Quotient of 67 had knowingly waived his Miranda rights under the totality of the circumstances. Testimony regarding those circumstances showed that he understood the statements on the waiver form, that he had not asked any questions about the form, and that his father had been present during the execution of the waiver forms. Likewise, in Oliver v. State, 322 Ark. 8, 907 S.W.2d 706 (1995), we held that a fifteen-year-old with the mental age equivalent of a twelve-year-old had knowingly and intelligently waived his rights where testimony from the suppression hearing showed that the arresting officers had explained the waiver-of-rights form to Oliver and that he appeared to understand it.
A common thread running through these cases is that the defendants had their rights carefully explained to them and either asked no questions or otherwise did not express confusion about the meaning of the waiver-of-rights form. In contrast, T.C. was given no explanation of the waiver-of-rights form the first time he signed it and instead was merely asked to read it for himself. The second time he was asked to sign the form, he said that he did not understand what "waiver" meant. Instead of explaining what waiver meant, the police gave T.C. the definition of voluntariness, saying: "what you are saying, you are doing of your own free will . . . [w]e haven't made any promises. We haven't threatened you in any way. You are doing this because you want to do this. And again, it is by your own free will that you do this, that you make this statement."
This definition of what "waiver" means was patently wrong. As a result, we conclude, based on T.C.'s question and the police officer's explanation, that T.C. did not understand the meaning of waiver. Waiver, of course, is routinely defined as the "intentional relinquishment or abandonment of a known right or privilege." See Pratt v. State, 359 Ark. 16, 194 S.W.3d 183 (2004) (quoting Brewer v. Williams, 430 U.S. 387, 97 S.Ct. 1232, 51 L.Ed.2d 424 (1977)). In laymen's terms, it is "giving up" something, in this case the right to be silent and the right to counsel. The police officer's explanation imparted to T.C. did not make clear that he was giving up his rights to remain silent and to the assistance of counsel. It necessarily follows then that T.C.'s waiver was not made with "a full awareness of both the nature of the right being abandoned and the consequences of the decision to abandon it." E.g., Otis v. State, 364 Ark. at 161, 217 S.W.3d at 845. And that is the crucial test. We hold that the circuit judge's finding that T.C. knowingly and intelligently waived his rights was clearly against the preponderance of the evidence. For this reason, we suppress T.C.'s confession. Because we suppress the confession due to T.C.'s lack of a knowing and intelligent waiver of his rights under Miranda, it is unnecessary to address the other grounds presented for suppression.
III. Brady Violation
Because we remand for a new delinquency proceeding, we will address only those issues likely to recur on retrial. See, e.g., Burton v. State, 367 Ark. 109, 238 S.W.3d 111 (2006).
*63 T.C. asserts that the State violated his due-process rights under Brady v. Maryland, 373 U.S. 83, 83 S.Ct. 1194, 10 L.Ed.2d 215 (1963), by failing to disclose a tape recording of an interview the police officers had with Chico Spinks, an acquaintance of T.C.'s mother, which allegedly contained exculpatory statements regarding T.C.'s guilt. The circuit judge, in denying T.C.'s motion to dismiss for the alleged Brady violation, found that there was insufficient evidence that a recording of the Spinks interview with police officers existed and that the State had provided Spinks's name and the substance of his statement to the defense. The judge further noted that the defense had not interviewed Spinks or called him to testify at the delinquency trial.
Under the Brady decision, the State is required to disclose all favorable evidence material to the guilt or punishment of the defendant. In Strickler v. Greene, 527 U.S. 263, 119 S.Ct. 1936, 144 L.Ed.2d 286 (1999), the Supreme Court outlined the three elements of a true Brady violation: (1) evidence exists that is favorable to the accused, either because it is exculpatory, or because it is impeaching; (2) the evidence was suppressed by the State, either willfully or inadvertently; and (3) prejudice resulted to the defendant. Evidence is material "if there is a reasonable probability that, had the evidence been disclosed to the defense, the result of the proceeding would have been different." Cook v. State, 361 Ark. 91, 105, 204 S.W.3d 532, 540 (2005) (quoting Strickler, 527 U.S. at 280, 119 S.Ct. 1936). The defendant has the burden of proving a Brady violation. Carter v. Bell, 218 F.3d 581, 601 (6th Cir.2000) (citing Moore v. Illinois, 408 U.S. 786, 92 S.Ct. 2562, 33 L.Ed.2d 706 (1972)).
Applying these principles, we conclude that T.C. has failed to meet his burden of proving a Brady violation. Initially, T.C. failed to establish to the circuit judge's satisfaction that the Spinks tape recording even exists. But even assuming that a tape recording of Spinks does exist, T.C. has not shown that the evidence was suppressed by the State. Evidence is not "suppressed" if the defendant either knew about it or should have known of the essential facts permitting him to take advantage of any exculpatory evidence. United States v. LeRoy, 687 F.2d 610 (2d Cir.1983), cert. denied, 459 U.S. 1174, 103 S.Ct. 823, 74 L.Ed.2d 1019 (1983); see also United States v. Diaz, 922 F.2d 998, 1007 (2d Cir.1990) ("There is no improper suppression within the meaning of Brady where the facts are already known by the defendant."). In the instant case, the State gave the defense Spinks's name and the substance of his statement to the police officers, which was that T.C.'s mother, Melody Jones, had talked about Kaylee's death in her sleep. Hence, T.C. was on notice that Spinks had information that might have helped in his defense. Yet, despite having this information, T.C. failed to subpoena Spinks as a witness to testify in his defense; nor did T.C.'s counsel interview him.
Further, even if this court were to determine that the State had suppressed evidence of Spinks's statement, T.C. has not met his burden of showing that the evidence was exculpatory. T.C. claims that Spinks told the police that T.C.'s mother had admitted in her sleep to killing Kaylee. However, the record reveals that Spinks told police that T.C.'s mother sat up in bed and began talking about Kaylee's death, using different voices for Kaylee and T.C. Such a statement alone neither exculpates T.C. nor inculpates his mother.
Moreover, T.C. has failed to show that the Spinks evidence was material within the meaning of the Brady rule. Again, *64 evidence is material "if there is a reasonable probability that, had the evidence been disclosed to the defense, the result of the proceeding would have been different." Here, there is nothing to indicate that the result of T.C.'s delinquency proceeding would have been different had the defense been in possession of a recording of Spinks's statement to police. Most significantly in this regard, the circuit judge was aware of the substance of Spinks's statement to police.
As a final point, T.C.'s claim that the Spinks recording, if it existed, was essential to the impeachment of the police officers and Melody Jones is not persuasive. Jones, although called as a witness for the defense, was never asked about Spinks, his alleged statement to the police, or whether she had made the statements alleged by T.C. As to the argument that the tape was essential to impeaching the police officers' testimony that Spinks was drunk when he gave the statement to police, we fail to see how this would have caused the result of the proceeding to be different. We hold that T.C. has failed to meet his burden of showing that a Brady violation occurred. Having held as we do, we emphasize that if the Chico Spinks tape does exist, it should be turned over to the defense on remand.
IV. The Circuit Judge's Disposition
We address a second issue because it too may recur at a retrial of the matter. T.C. contends that Arkansas Code Annotated section 9-27-330 does not authorize probation for a period of more than two years. Because of this, he claims that the circuit judge erred by placing him on probation until his eighteenth birthday. This argument is not persuasive because T.C. was not placed on probation until his eighteenth birthday; rather he was committed to the Division of Youth Services on August 15, 2008, with the condition that should he be released prior to his eighteenth birthday, he would be placed on probation from that point forward until his eighteenth birthday. Accordingly, there is no error on this point.
T.C. also maintains that the circuit judge erred by committing him to the Division of Youth Services and urges that the circuit judge failed to consider the best interests of the juvenile and the least restrictive alternative, as required by statute. Section 9-27-330(a)(1)(B) provides that "if a juvenile is found to be delinquent, the circuit court may . . . based upon the best interest of the juvenile . . . [c]ommit the juvenile to the Division of Youth Services." Despite T.C.'s argument to the contrary, the record reveals that the circuit judge considered T.C.'s best interests in determining his disposition. As an additional point, the circuit judge's decision was consistent with the recommendation from T.C.'s South Arkansas Youth Services counselor.
There was no error stemming from T.C.'s disposition.
Reversed and remanded. Court of Appeals reversed.
Special justices STUART W. HANKINS and AMY LEE STEWART join in this opinion.
CORBIN and WILLS, JJ., not participating.
NOTES
[1] The time that T.C.'s initial interview began was disputed at oral argument. According to T.C.'s counsel, the initial interview began closer to 5:00 p.m.
[2] The circuit judge's order, entered on June 27, 2007, stated that T.C. did not oppose the State's request for an extended-juvenile-jurisdiction designation.
[3] Because of the reduction of the charge against T.C., he was no longer eligible for an extended-juvenile-jurisdiction designation. See Ark.Code Ann. § 9-27-501(a)(1) (juveniles under thirteen years of age eligible for extended juvenile jurisdiction for the charges of capital murder and murder in the first degree).
[4] Both parties reference Arkansas Code Annotated section 9-27-317(c) in their arguments on this point. That section provides a list of seven factors that must be considered in "determining whether a juvenile's waiver of the right to counsel at any stage of the proceeding was made freely, voluntarily, and intelligently." Section 9-27-317(c) refers to the juvenile's right to counsel at "any stage of the proceeding." Under section 9-27-310(a), proceedings are commenced by filing a petition with the circuit clerk of the circuit court or by transfer from another court. Accordingly, the situation at issue under this point occurred prior to the commencement of proceedings under the Juvenile Code, and section 9-27-317(c) does not appear to be apposite.
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884 F.2d 1387Unpublished 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.Thomas G. DESHIELDS, Plaintiff-Appellant,v.BALTIMORE CITY FIRE DEPARTMENT, Defendant-Appellee,Mayor and City Council of Baltimore, Civil ServiceCommission of Baltimore City, Defendants-Appellees.
No. 88-3152.
United States Court of Appeals, Fourth Circuit.
Submitted July 6, 1989.Decided Aug. 24, 1989.
Norris C. Ramsey, P.A. on brief for appellant.
Neal M. Janey, City Solicitor, John S. Wood, Chief Solicitor, Eileen A. Carpenter, Special Solicitor, on brief for appellees.
Before ERVIN, Chief Judge, and PHILLIPS and WILKINSON, Circuit Judges.
PER CURIAM:
1
On May 8, 1984, Thomas G. DeShields filed this action pursuant to Title VII of the Civil Rights Act of 1964. See 42 U.S.C. Secs. 2000e et seq. Plaintiff, a black captain in the Baltimore City Fire Department, alleges that certain facets of the promotions process used by the city in promoting captains to battalion chiefs has had an adverse impact on blacks. See Dothard v. Rawlinson, 433 U.S. 321, 328-31 (1977). The district court referred the action to a magistrate acting as a special master, see 42 U.S.C. Sec. 2000e-5(f)(5), and on March 23, 1988, the magistrate found that plaintiff failed to establish a prima facie case of discrimination. On July 12, 1988, the district court overruled plaintiff's exceptions to the magistrate's report and recommendation and adopted it. We affirm.
2
There are presently twenty-nine battalion chief positions in the Baltimore City Fire Department and vacancies are filled by promotion from the rank of captain. Since 1973, promotions have been based on several factors: a written multiple choice examination; a seniority adjustment; and, at times, an efficiency rating. In 1982, only the examination and seniority factors were used. An individual was placed on an eligibility list if his score exceeded a minimum passing number. Adjustments for seniority were made and promotions were based on a strict rank order as required by union agreement.
3
Plaintiff joined the Baltimore City Fire Department in March of 1955; he has served as a fire fighter, pump operator, lieutenant, and was promoted to the rank of captain in April of 1972. Plaintiff has taken the battalion chief promotion examination each time it has been offered, and, each time his name has appeared on the eligibility list. In 1982, he was eighteenth and the highest ranking black on the list. Only six captains were made battalion chiefs in 1982; plaintiff was therefore not chosen for promotion.
4
Plaintiff asserts that the 1982 promotion examination and the method of rank ordering applicants for purposes of promotion have had an adverse impact on all blacks, including himself. The magistrate found, however, that plaintiff failed to establish a prima facie case of adverse impact, specifically challenging the probative force of plaintiff's statistical data. See generally Wards Cove Packing Co. v. Atonio, 109 S.Ct. 2115, 2121-24 (1989); Hazelwood School Dist. v. United States, 433 U.S. 299, 307-09 (1977). The magistrate's findings, as those of a special master, are subject to a clearly erroneous standard of review. See Fed.R.Civ.P. 53(e)(2). See also Brown v. Wesley's Quaker Maid, Inc., 771 F.2d 952, 954-56 (6th Cir.1985).
5
Plaintiff argued, for example, that defendants' rank ordering procedure had an adverse impact on blacks because it violated the Equal Employment Opportunity Commission (EEOC) guideline known as the "four-fifths rule." Here, the four-fifths rule involves a comparison of the percentage of blacks promoted with the percentage of whites promoted. According to the EEOC, adverse impact may generally be inferred if the ratio falls below 4/5--i.e., 80 percent. See 29 C.F.R. Sec. 1607.4D (1988). In this case, the magistrate calculated the ratio of black to white promotions to be 65.8 percent. The four-fifths rule merely represents, however, a numerical proxy with little independent statistical significance. A rule of thumb used by a federal agency is not binding as a rule of law upon a federal court. We agree with the magistrate that a violation of the rule does not alone establish a prima facie case of discrimination under Title VII. We also agree with the magistrate that the sample upon which the plaintiff's four-fifths rule calculations were based was too small to be statistically reliable. A change in the race of only a few of those promoted could make a significant mathematical difference in the outcome of the four-fifths rule calculations. See 29 C.F.R. Sec. 1607.4D (1988).
6
The magistrate also found that plaintiff failed to establish a prima facie case of discrimination based on a statistical analysis of the 1982 promotion examinations. Although plaintiff's expert testified that there were substantial disparities between the test scores of blacks and whites, the magistrate agreed with defendants' expert that the data relied upon by plaintiff's expert was insufficient to draw reliable statistical conclusions. According to defendants' expert, too few blacks and whites took the 1982 examination to allow for rigorous statistical analysis of the data. As the district court recognized, the magistrate was in the best position to assess the qualifications and credibility of the witnesses, and the magistrate's decision to credit the testimony of defendants' expert is not clearly erroneous.
7
We affirm the judgment for the reasons stated in the magistrate's report and recommendation, see DeShields v. Mayor & City of Baltimore, No. B-84-1905 (D.Md. Mar. 23, 1988) (Magistrate's Report and Recommendation), as adopted by the district court.
8
AFFIRMED.
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11-4808-cr
U.S. v. Galpin
1 UNITED STATES COURT OF APPEALS
2 FOR THE SECOND CIRCUIT
3 ______________________
4 August Term 2012
5 (Argued: November 19, 2012 Decided: June 25, 2013)
6 Docket No. 11-4808-cr
7 _______________________
8 UNITED STATES OF AMERICA,
9 Appellee,
10 — v. —
11 JAMES R. GALPIN, JR.,
12 Defendant-Appellant.
13 ________________________
14 Before:
15 JACOBS, Chief Judge, WINTER, Circuit Judge,
16 and SWAIN, District Judge.*
17 ________________________
18 Appeal, following conditional guilty plea, from denial of motion to suppress
19 evidence indicative of guilt of child pornography-related offenses. Affirmed in part, and vacated
20 and remanded in part.
21 ___________________
22 * The Honorable Laura Taylor Swain of the United States District Court for the Southern
23 District of New York, sitting by designation.
1
1 _____________________________
2 JAMES P. EGAN (Lisa Peebles and James F. Greenwald on the brief)
3 Federal Public Defender’s Office, Northern District of New York,
4 Syracuse, New York, for Defendant-Appellant James Galpin, Jr.
5 PAUL D. SILVER, Assistant United States Attorney (Richard S. Hartunian, United
6 States Attorney, and Miroslav Lovric, Assistant United States Attorney,
7 on the brief), Northern District of New York, Albany, New York, for
8 Appellee.
9 _______________________________
10 SWAIN, District Judge:
11 Defendant-Appellant James R. Galpin, Jr. (“Galpin”), was convicted in the United
12 States District Court for the Northern District of New York (McAvoy, J.) upon a conditional
13 guilty plea, of several counts of production of child pornography, committing a felony offense
14 involving a minor while being required to register as a sex offender, and possession of child
15 pornography. He was sentenced on November 1, 2011, principally to 572 months of
16 imprisonment. Prior to his guilty plea, Galpin had moved to suppress all of the evidence,
17 including images of child pornography found on Galpin’s computer, digital cameras, and digital
18 storage devices, that had been seized in the execution of a search warrant that authorized officers
19 to search for “evidence that will constitute, substantiate or support violations of NYS
20 Corrections Law, section 168-f subdivision four, NYS Penal Law and or Federal Statutes.”1 The
21 district court denied Galpin’s motion in its entirety, holding that, although the warrant was
22 overbroad and probable cause was lacking for its authorization to conduct a search for child
23 pornography, the warrant was severable and the images that were found would have been in
1
The cited Correction Law provision requires the registration of certain internet
service provider and communications accounts. [See infra note 2].
2
1 plain view during the execution of a properly limited search. Galpin appeals from the district
2 court’s November 2, 2011, judgment. We affirm the district court’s determinations that the
3 officers lacked probable cause to search for evidence of child pornography and that the warrant
4 was facially overbroad. Because we find deficient the factual and analytical record as to whether
5 the warrant was severable and whether the images of child pornography were seized in plain
6 view, we vacate the judgment and remand the case for further proceedings consistent with this
7 opinion.
8 BACKGROUND
9 The Underlying Investigation
10 Galpin was convicted in New York in 1991 of Sexual Abuse in the First Degree.
11 He had abused 22 boys between the ages of 10 and 15. In June 2009, several years after his
12 release from custody and following a tip from a “concerned citizen” who reported having seen
13 Galpin with a young boy and calls from two parents reporting that Galpin had contacted their
14 children, the Southern Tier Cyber Predator Task Force opened an investigation. Law
15 enforcement officials in Tioga County, New York, installed a 24-hour surveillance camera
16 outside of Galpin’s residence. The surveillance revealed numerous boys between the ages of 10
17 and 16 visiting the residence and spending the night. The investigation also revealed that Galpin
18 was communicating with at least one minor boy on the Internet social networking site
19 “MySpace” using the screename “Medic Guy.” Specifically, investigators found Galpin’s
20 photograph and the “Medic Guy” online identity posted on the MySpace page of a 13-year old
21 boy, who was Galpin’s relative. Upon discovering the posting, investigators reviewed Galpin’s
22 sex offender registration and learned that he had failed to register the “Medic Guy” identifier as
3
1 required by N.Y. Correction Law § 168-f.2
2 The Search Warrant
3 On July 6, 2009, Tioga County Sheriff’s Department Senior Investigator Patrick
4 Hogan (“Hogan”) applied to the Owego Town Court for a warrant to search Galpin’s residence,
5 person, and vehicles for, inter alia, cameras, computers, cell phones, and any and all computing
6 or data processing software, “which may reveal evidence which substantiates violations of Penal
7 Law statutes, Corrections Law statutes and or Federal statutes.” Warrant Appl. 1, July 6, 2009.
8 In the warrant application, Hogan set forth the details of the investigation, including observed
9 interactions and communications with young males, and the fact that an internet provider had
10 revealed in response to a subpoena that the subscriber I.P. address associated with the “Medic
11 Guy” posting belonged to Galpin.
12 Based on this information, Hogan concluded in his application that Galpin was
13 “engaged in the use of the internet via MySpace and chat to lure juvenile males to the residence
14 for the purpose of engaging in sexual conduct, . . . using [his] cell phone to make contact with
15 and direct the pickup of juveniles, . . . [and] transport[ing] juvenile males to his residence.”
16 Warrant Appl. 2. Citing his training and experience, Hogan further proffered that “persons
17 involved in child sexual exploitation use the internet, cell phones and practices of becoming
2
N.Y. Correction Law § 168-f(4) provides, in relevant part, that: “Any sex
offender shall register with the division [of criminal justice] no later than ten
calendar days after any change of address, internet accounts with internet
access providers belonging to such offender, [and] internet identifiers that such
offender uses . . . .” “Internet identifiers” are defined as “electronic mail
addresses and designations used for the purposes of chat, instant messaging,
social networking or other similar internet communication.” N.Y. Correct. Law §
168-a(18).
4
1 juvenile friendly to groom juveniles for the purpose of engaging in sexual behavior with
2 children.” Warrant Appl. 2. In addition, Hogan made the following claim:
3 [I]t is reasonable to expect that upon execution of this warrant evidence will be
4 obtained that James Galpin Jr. is using his computer or other device[s] capable of
5 accessing the World Wide Web to include but not limited to computer’s [sic], cell
6 phones, game systems or ipod’s [sic] capable of communicating with other
7 persons, to post, chat, text, sending pictures or video’s [sic], or talk live and
8 evidence of such will be located at the residence or on the person, or vehicle of
9 James Galpin, Jr.
10 Warrant Appl. 3. Finally, again citing his training and experience, Hogan asserted that “persons
11 who engage in sexual predator behaviors do not provide current e-mail address’s [sic], user
12 names or passwords on their sexual offender registration to avoid detection of illegal activities
13 by Law Enforcement and to divert Law Enforcement to a plausible or legitimate e-mail which do
14 [sic] not contain any of the subjects [sic] illicit activities.” Warrant Appl. 3.
15 Upon being presented with the application, Town of Owego Justice Robert W.
16 Henning issued a warrant to search Galpin’s residence, vehicle, and person for property
17 “believed to contain evidence that will constitute, substantiate or support violations of NYS
18 Corrections Law, section 168-f subdivision four, NYS Penal Law and or Federal Statutes.”
19 Warrant 1, July 6, 2009. More specifically, the warrant, which did not incorporate the
20 application, authorized the seizure and subsequent search of:
21 1) Any Computers, central processing units, external and internal drives, storage
22 units or media terminals and video display units, together with peripheral
23 equipment such as keyboards, printers, modems, scanners or digital camera’s [sic]
24 and their internal or external storage media.
25
26 2) Any and all computing or data processing software, or data including but not
27 limited to hard disks, floppy disks, magnetic tapes, intregal [sic] RAM or ROM
28 units, and any other permanent or portable storage device(s) which may reveal
29 evidence and substantiates violations of the aforementioned NYS and federal
30 statutes.
5
1 3) The following records and documents, whether contained or stored on the
2 computer, magnetic tape, cassette, disk, diskette, photo optical device, or any
3 other storage medium:
4
5 a. Any access numbers, passwords, personal identification numbers
6 (PINS), logs, notes, memoranda and correspondence relating to
7 computer, electronic and voice mail systems, internet address’s
8 [sic] and/or related contacts.
9
10 b. Any computing or data processing literature, including, but not
11 limited to printed copy, instruction books, notes, papers, or listed
12 computer programs, in whole or in part.
13
14 c. Any audio or video cassette tape recordings, books magazines [sic],
15 periodicals, or other recorded or printed material, the possession
16 of which constitutes a violation of the aforementioned statutes of
17 the Laws of New York state or Federal Statutes.
18
19 d. Any and all photographs depicting sexual conduct by a child
20 and/or minors engaged in sexually explicit conduct.
21
22 e. Any records or correspondence relating to the possession,
23 transmission, collection, trading or production of the
24 aforementioned photographs.
25 Id.
26 Hogan executed the warrant on July 8, 2009. Among the items discovered were a
27 computer and digital photography equipment that were found upon forensic examination to
28 contain images of child pornography. On March 10, 2010, a grand jury handed up a nine-count
29 indictment, charging Appellant with four counts of production of child pornography in violation
30 of 18 U.S.C. § 2251(a) and (e), one count of possession of child pornography in violation of 18
31 U.S.C. § 2252A(a)(5)(B), and four counts of committing a felony offense involving a minor,
32 specifically the four production counts, while being required to register as a sex offender in
33 violation of 18 U.S.C. § 2260A.
6
1 Galpin’s Suppression Motion
2 On December 16, 2010, Galpin moved to suppress the evidence obtained and
3 derived from the search warrant.3 Galpin argued that investigators lacked probable cause to
4 believe that he had committed any offense beyond failing to register an internet identifier, as
5 required by N.Y. Correction Law § 168-f(4), and thus had no basis for conducting a broad search
6 of the information contained on his computer and camera equipment. Galpin also argued that, by
7 expansively referencing “NYS Penal Law and or Federal Statutes,” the warrant authorized an
8 impermissible general search. The government opposed the motion to suppress, arguing that the
9 warrant application established probable cause to believe that Galpin was using the internet and
10 cell phones to lure minors for sexual activity, and that he had failed to register the “Medic Guy”
11 identifier that Galpin had used to contact a minor via MySpace. The Government also argued
12 that, even if the warrant was invalid insofar as it authorized a search for pornographic images,
13 such images were in plain view incident to the properly authorized search for evidence of a
14 registration offense and luring, and that, in any event, investigators acted on the warrant in good
15 faith, such that suppression was inappropriate under United States v. Leon, 468 U.S. 897 (1984).
16 On January 24, 2011, the district court held a suppression hearing, during which
17 the court heard oral argument from counsel and examined the warrant and underlying
18 application. Following the argument, the court made oral findings that “[t]he facts asserted in
19 the warrant application establish that the defendant was using the internet, including posting
20 images of himself online to communicate with minor males, in violation of the registration
3
Galpin also requested a hearing pursuant to Franks v. Delaware, 438 U.S. 154
(1978). The district court denied that request and Galpin does not challenge that
ruling.
7
1 requirements,” and that it was “reasonable to conclude that engaging in such acts involved the
2 use of a computer or other device with access to the internet . . . .” The court continued:
3 [I]t was reasonable to conclude that relevant evidence would include any and all
4 information concerning defendant’s accessing the internet, including passwords
5 and other documents or information concerning his accessing the internet and
6 using screen names or accounts that he failed to register. This is because the
7 defendant used the internet in furtherance of his failure to register. It similarly is
8 reasonable to conclude that relevant evidence would include digital pictures that
9 he may have uploaded or downloaded in furtherance of his efforts to locate and
10 communicate with minor males under accounts that he did not register. Such
11 evidence would be relevant to whether it was actually defendant who was using
12 an unregistered user name or e-mail account.
13 The court also found that it was a “reasonable and logical inference to believe that persons who
14 communicate with one another via the internet will share photographs, whether sexually explicit
15 or not,” emphasizing that it had been established that the “defendant did upload an image of
16 himself to a minor’s MySpace page, albeit not a sexually explicit photograph.” The court
17 concluded that it was “not a far leap to conclude that there may have been evidence of defendant
18 uploading other pictures of himself or having downloaded pictures of the people he met online,
19 including minors” and, therefore, that the warrant authorizing the search of computers and digital
20 equipment for images was reasonable.
21 In addition, the district court found that there was probable cause to believe that
22 Galpin was “grooming or luring minor males for inappropriate sexual conduct or had engaged in
23 unlawful sexual conduct with a minor,” based on the warrant affidavit’s proffers concerning
24 Galpin’s criminal history, surveillance observation of overnight stays by young males in
25 Galpin’s home, internet and other communications with minor males, the presence of computer
26 and massage equipment in Galpin’s home, “his bringing minor males to his home in his
27 vehicle[,] and his failure to register the user name that he was using to communicate with minor
28 males.”
8
1 The district court specifically found that the warrant application failed to establish
2 probable cause to search for child pornography and upheld Galpin’s overbreadth objection to the
3 extent the warrant authorized searches for evidence of unspecified New York State Penal Code
4 and Federal Law violations. The court concluded, however, that the invalid portions of the
5 warrant could be “redacted” from the valid ones, and directed that a hearing would be held to
6 determine whether the evidence of child pornography was seized in plain view during the
7 execution of the search warrant.
8 Although the district court did not identify specifically the elements of the
9 warrant that could be redacted or those that would remain, it observed that the “affidavit clearly
10 discusses activity relating to defendant’s failure to register and his attempting to lure minor
11 males for sexual activity . . . [and that i]t, thus, appears that Hogan intended to look only for
12 evidence relating to the failure to register and efforts by the defendant to lure minor males for
13 purposes of sexual activity.” The district court also found, subject to receipt of evidence as to
14 the search methodology that had revealed the child pornography, that, “[c]onsidering the totality
15 of the nature of the investigation, the documents in support of the warrant, and the warrant itself,
16 the Court does not discern deliberate police misconduct in attempting to engage in a general
17 search such that exclusion would be justified.”
18 The Evidentiary Hearing
19 An evidentiary hearing in connection with the suppression motion was held on
20 March 1, 2011. At the hearing, the government called Marsha Powell (“Powell”), a computer
21 forensics analyst with the Computer Analysis and Technical Services lab of the Broome County
22 Security Division. Powell testified that law enforcement officers had provided her with
23 materials and information in support of their request that consisted of, inter alia, the warrant
9
1 affidavit and warrant contents, a timeline of activity in connection with the investigation, and of
2 Galpin’s post-warrant arraignment on 20 charges of a criminal sex act in the second degree,
3 misdemeanor sexual abuse charges, and charges of forceable touching and endangering the
4 welfare of a child. Powell testified that, in conducting her examination, she looked for files
5 associated with the names of suspected minors who were listed in the timeline report and the
6 “Medic Guy” identifier, as well as “images of a sexual nature if they involved what [she] thought
7 might be underage males or younger males,” and for “images that [she] believed would be of Mr.
8 Galpin.”4 Before Powell conducted her examination of Galpin’s computer, digital camera, and
9 digital storage media, she learned that Galpin had accessed web sites, especially social
10 networking sites such as MySpace. She testified that she knew that there might be images of
11 Galpin on at least one of those web sites, and that the storage media might contain the names and
12 images of potential male victims of Galpin’s.
13 Powell explained that, in order to conduct the analysis of Galpin’s
14 computer and devices, she first made an image, or duplicate, of the hard drive. The forensic
15 analysis was conducted on that duplicate. Powell began her examination of the computer by
16 doing word searches for pertinent names based upon her review of the information provided to
17 her. Once the initial word searches were completed, Powell segregated the types of files that had
18 been identified as containing relevant information. These files were then opened and examined
19 individually. Powell explained that each file on the hard drive contained an extension
4
See also the district court’s Decision and Order, United States v. Galpin, No. 10-
110, slip op at 3 (N.D.N.Y. Mar. 3, 2011), ECF No. 33 (“Powell was looking for
evidence of online communications between Defendant and minors and evidence
that Defendant had shared digital photographs of himself with minors or obtained
digital photographs of minors, which may have included pornography.”).
10
1 corresponding to the type of associated file (e.g., “doc” for Microsoft Word documents or “jpeg”
2 for image files). Powell testified that, while the file name signifies the file type, the name may
3 bear no relationship to the file’s content; therefore, the only way to determine the content is to
4 open the file. As Powell reviewed the files, she bookmarked ones she deemed relevant to the
5 investigation. In addition to searching all of the images and text files on the computer and
6 storage media, Powell testified, she opened and viewed every video file. Powell admitted that,
7 after she conducted a search of the hard drive for files containing certain terms, she conducted a
8 search of the entire hard drive. During the search, Powell stated, she was looking for internet
9 history showing child pornography, evidence of sexual abuse of children, evidence of
10 communications with children, and “images of a sexual nature if they involved what [Powell]
11 thought might be underage males or younger males.”
12 On March 3, 2011, the District Court issued a written opinion denying Galpin’s
13 suppression motion. Crediting Powell’s testimony, the district court found that the forensic
14 examination of Galpin’s computer required opening and viewing every file to determine whether
15 it contained relevant content. In doing so, the district court found, Powell had inadvertently
16 observed images of child pornography. Consequently, the district court held, the plain view
17 doctrine applied because (1) the government had probable cause to search Galpin’s computer for
18 “images or other evidence concerning the sex offender registration violation”; (2) the discovery
19 was inadvertent “in that Powell had to open each file to determine whether they fell within the
20 scope of the warrant”; and (3) “the incriminating nature of the evidence was readily apparent by
21 simply looking at the pictures and drawing logical inferences concerning the depictions therein.”
11
1 The Plea and Aftermath
2 On March 9, 2011, Galpin entered a conditional plea of guilty to the nine-count
3 indictment. The plea agreement preserved his right to appeal the district court’s denial of his
4 motion to suppress evidence. On November 2, 2011, the district court entered judgment
5 sentencing Galpin principally to a 572-month term of imprisonment. Galpin filed a timely notice
6 of appeal on November 10, 2011.
7 DISCUSSION
8 The standard of review for evaluating the district court's ruling on a suppression
9 motion is clear error as to the district court's factual findings and de novo as to questions of law.
10 United States v. Rodriguez, 356 F.3d 254, 257 (2d Cir. 2004). The evidentiary record is
11 reviewed in the light most favorable to the government. United States v. Rosa, 626 F.3d 56, 61
12 (2d Cir. 2010).
13 I.
14 The Fourth Amendment to the Constitution of the United States provides that:
15 “The right of the people to be secure in their persons, houses, papers, and effects, against
16 unreasonable searches and seizures, shall not be violated, and no Warrants shall issue, but upon
17 probable cause, supported by Oath or affirmation, and particularly describing the place to be
18 searched, and the persons or things to be seized.” U.S. Const. amend. IV.
19 The chief evil that prompted the framing and adoption of the Fourth Amendment
20 was the “indiscriminate searches and seizures” conducted by the British “under the authority of
21 ‘general warrants.’” Payton v. New York, 445 U.S. 573, 583 (1980); Arizona v. Gant, 556 U.S.
22 332, 345 (2009) (“[T]he central concern underlying the Fourth Amendment [is] the concern
12
1 about giving police officers unbridled discretion to rummage at will among a person’s private
2 effects.”). To prevent such “general, exploratory rummaging in a person’s belongings” and the
3 attendant privacy violations, Coolidge v. New Hampshire, 403 U.S. 443, 467 (1971), the Fourth
4 Amendment provides that “a warrant may not be issued unless probable cause is properly
5 established and the scope of the authorized search is set out with particularity.” Kentucky v.
6 King, --- U.S.---, 131 S. Ct. 1849, 1856 (2011).
7 The particularity requirement has three components. First, a warrant must
8 identify the specific offense for which the police have established probable cause. See United
9 States v. Bianco, 998 F.2d 1112, 1116 (2d Cir. 1993) (warrant that contained no particular
10 description of items and made no mention of any criminal statute or criminal conduct was “not
11 supportable”), abrogated on other grounds by Groh v. Ramirez, 540 U.S. 551 (2004); United
12 States v. George, 975 F.2d 72, 76 (2d Cir. 1992) (warrant authorizing search for evidence
13 “relating to the commission of a crime” was overbroad because “[n]othing on the face of the
14 warrant tells the searching officer for what crimes the search is being undertaken”).5 Second, a
15 warrant must describe the place to be searched. United States v. Voustianiouk, 685 F.3d 206,
5
Mindful that the purpose of this requirement is to minimize the discretion of the
executing officer, other Circuits have held that even warrants that identify catch-
all statutory provisions, like the mail fraud or conspiracy statutes, may fail to
comply with this aspect of the particularization requirement. See, e.g., United
States v. Leary, 846 F.2d 592, 594 (10th Cir. 1988) (warrant authorizing search of
export company’s business records for violation of the “Arms Export Control Act,
22 U.S.C. § 2778, and the Export Administration Act of 1979, 50 U.S.C.App. §
2410,” held overbroad); Voss v. Bergsgaard, 774 F.2d 402 (10th Cir. 1985)
(warrant specifying 18 U.S.C. § 371, the general federal conspiracy statute, held
overbroad); United States v. Roche, 614 F.2d 6, 8 (1st Cir. 1980) (concluding that
a limitation of a search to evidence relating to a violation of 18 U.S.C. § 1341, the
general mail fraud statute, provides “no limitation at all”).
13
1 211 (2d Cir. 2012); 2 W. LaFave, Search and Seizure § 4.6(a) (5th ed. 2012) (“[G]eneral
2 searches are prevented by the other Fourth Amendment requirement that the place to be searched
3 be particularly described.”). Third, the warrant must specify the “items to be seized by their
4 relation to designated crimes.” United States v. Williams, 592 F.3d 511, 519 (4th Cir. 2010); see
5 also United States v. Buck, 813 F.2d 588, 590-92 (2d Cir. 1987) (finding that a warrant
6 authorizing the seizure of “any papers, things or property of any kind relating to [the] previously
7 described crime” failed the particularization requirement because it “only described the crimes –
8 and gave no limitation whatsoever on the kind of evidence sought”). “[A]n otherwise
9 unobjectionable description of the objects to be seized is defective if it is broader than can be
10 justified by the probable cause upon which the warrant is based.” 2 W. LaFave, Search and
11 Seizure § 4.6(a) (5th ed. 2012).
12 In an oft-quoted passage, the Supreme Court has held that the particularity
13 requirement “makes general searches . . . impossible and prevents the seizure of one thing under
14 a warrant describing another. As to what is to be taken, nothing is left to the discretion of the
15 officer executing the warrant.” Marron v. United States, 275 U.S. 192, 196 (1927). To be sure,
16 we have noted that this “no discretion” standard “has not always been applied literally,” and that
17 courts may tolerate some ambiguity in the warrant so long as “law enforcement agents have done
18 the best that could reasonably be expected under the circumstances, have acquired all the
19 descriptive facts which a reasonable investigation could be expected to cover, and have insured
20 that all those facts were included in the warrant.” United States v. Young, 745 F.2d 733, 759 (2d
21 Cir. 1984). Nonetheless, we have emphasized that “a failure to describe the items to be seized
22 with as much particularity as the circumstances reasonably allow offends the Fourth Amendment
14
1 because there is no assurance that the permitted invasion of a suspect’s privacy and property are
2 no more than absolutely necessary.” George, 975 F.2d at 76.
3 Where, as here, the property to be searched is a computer hard drive, the
4 particularity requirement assumes even greater importance. As numerous courts and
5 commentators have observed, advances in technology and the centrality of computers in the lives
6 of average people have rendered the computer hard drive akin to a residence in terms of the
7 scope and quantity of private information it may contain.6 See United States v. Payton, 573 F.3d
8 859, 861-62 (9th Cir. 2009) (“There is no question that computers are capable of storing
9 immense amounts of information and often contain a great deal of private information. Searches
10 of computers therefore often involve a degree of intrusiveness much greater in quantity, if not
11 different in kind, from searches of other containers.”); United States v. Otero, 563 F.3d 1127,
12 1132 (10th Cir. 2009) (noting computer’s potential “to store and intermingle a huge array of
13 one’s personal papers in a single place”); Orin Kerr, Searches and Seizures in a Digital World,
14 119 Harv. L. Rev. 531, 569 (2005) (Computers “are postal services, playgrounds, jukeboxes,
15 dating services, movie theaters, daily planners, shopping malls, personal secretaries, virtual
16 diaries, and more.”). The potential for privacy violations occasioned by an unbridled,
17 exploratory search of a hard drive is enormous. This threat is compounded by the nature of
18 digital storage. Where a warrant authorizes the search of a residence, the physical dimensions of
19 the evidence sought will naturally impose limitations on where an officer may pry: an officer
6
Tellingly, at the January 24, 2011, district court hearing, the government itself
compared the hard drive search to a house search: “[the] search of a computer is
no different than an officer searching various places in the home. An officer can’t
tell what’s in the drawer or what’s in the folder if he has or she has authority to
look in those places.”
15
1 could not properly look for a stolen flat-screen television by rummaging through the suspect’s
2 medicine cabinet, nor search for false tax documents by viewing the suspect’s home video
3 collection.7 Such limitations are largely absent in the digital realm, where the size or other
4 outwardly visible characteristics of a file may disclose nothing about its content.8
5 As the Ninth Circuit has explained, because there is currently no way to ascertain
6 the content of a file without opening it and because files containing evidence of a crime may be
7 intermingled with millions of innocuous files, “[b]y necessity, government efforts to locate
8 particular files will require examining a great many other files to exclude the possibility that the
9 sought-after data are concealed there.” United States v. Comprehensive Drug Testing, Inc., 621
10 F.3d 1162, 1176 (9th Cir. 2010) (en banc) (per curiam). Once the government has obtained
11 authorization to search the hard drive, the government may claim that the contents of every file it
12 chose to open were in plain view and, therefore, admissible even if they implicate the defendant
13 in a crime not contemplated by the warrant. There is, thus, “a serious risk that every warrant for
14 electronic information will become, in effect, a general warrant, rendering the Fourth
15 Amendment irrelevant.” Id. This threat demands a heightened sensitivity to the particularity
16 requirement in the context of digital searches.
7
Cf. United States v. Ross, 456 U.S. 798, 824 (1982) (the scope of a lawful search
is “defined by the object of the search and the places in which there is probable
cause to believe that it may be found. Just as probable cause to believe that a
stolen lawnmower may be found in a garage will not support a warrant to search
an upstairs bedroom, probable cause to believe that undocumented aliens are
being transported in a van will not justify a warrantless search of a suitcase.”).
8
See, e.g., United States v. Crespo-Rios, 645 F.3d 37, 43 (1st Cir. 2011)
(recognizing that files may easily be manipulated through, inter alia, mislabeling
to disguise their content); accord United States v. Hill, 459 F.3d 966, 977-78 (9th
Cir. 2006).
16
1 II.
2 The district court determined, and the government does not dispute, that insofar as
3 the warrant generally authorized officers to search Galpin’s physical property and electronic
4 equipment for evidence of violations of “NYS Penal Law and or Federal Statutes,” the warrant
5 violated the Fourth Amendment’s particularity requirement. See, e.g., United States v. Rosa,
6 626 F.3d 56, 62 (2d Cir. 2010) (warrant authorizing seizure of electronic equipment without
7 specifying the legal violation “provided [officers] with no guidance as to the type of evidence
8 sought” and constituted a general warrant); United States v. George, 975 F.2d 72, 76 (2d Cir.
9 1992) (“Mere reference to ‘evidence’ of . . . general criminal activity provides no readily
10 ascertainable guidelines for the executing officers as to what items to seize . . . . [A]uthorization
11 to search for ‘evidence of a crime,’ that is to say, any crime, is so broad as to constitute a general
12 warrant.”); see also United States v. Burgess, 576 F.3d 1078, 1091 (10th Cir. 2009) (“If the
13 warrant is read to allow a search of all computer records without description or limitation it
14 would not meet the Fourth Amendment's particularity requirement.”).
15 The only crime that is specified in the warrant at issue here is the registration
16 offense. The district court found (and the government concedes) that there was no probable
17 cause to believe that Galpin possessed or produced child pornography – crimes that were
18 mentioned neither in the warrant application nor in the warrant itself, which nonetheless
19 authorized a search for images depicting child sexual activity. While the district court found that
20 the warrant application provided probable cause to believe that Galpin was communicating with
21 and luring young males to his residence, the government does not contend that the warrant
22 authorized officers to search for evidence of luring. Nor could it, given the fact that the warrant
23 neither mentions the luring offense nor incorporated the warrant application. See Groh v.
17
1 Ramirez, 540 U.S. 551, 557 (2004) (“The fact that the application adequately described the
2 ‘things to be seized’ does not save the warrant from its facial invalidity. The Fourth Amendment
3 by its terms requires particularity in the warrant, not in the supporting documents.” (emphasis in
4 original)).
5 While we agree that the warrant was facially overbroad and thus violated the
6 Fourth Amendment, this conclusion does not end the inquiry. As the district court recognized,
7 the proper next steps are, first, to determine whether the warrant is severable – i.e., whether it is
8 possible to carve out the portions of the warrant authorizing a search for evidence of a
9 registration offense from the constitutionally infirm remainder – and, if so, whether the
10 challenged evidence was in plain view when it was seized. Because we find the district court’s
11 analysis and the factual record deficient as to both issues, we will vacate the judgment and
12 remand for further proceedings consistent with the discussion that follows.
13 A. Severability
14 When a warrant is severable, the portion of the warrant that is “constitutionally
15 infirm . . . – usually for lack of particularity or probable cause – is separated from the remainder
16 and evidence seized pursuant to that portion is suppressed; evidence seized under the valid
17 portion may be admitted.” George, 975 F.2d at 79. The severance doctrine is animated by the
18 need to balance the considerable social costs of suppressing evidence of guilt against the need to
19 deter police misconduct, and the judgment that it would be unduly “harsh medicine” to suppress
20 evidence whose seizure was authorized by a particularized portion of a warrant simply because
21 other portions of the warrant failed that requirement. LaFave, Search and Seizure § 4.6(f).
22 However, we have cautioned that severance is not an available remedy for an overbroad warrant
23 “where no part of the warrant is sufficiently particularized, where no portion of the warrant may
18
1 be meaningfully severed, or where the sufficiently particularized portions make up only an
2 insignificant or tangential part of the warrant.” George, 975 F.2d at 79-80 (internal citations
3 omitted).
4 We have not previously prescribed how the severance analysis is to be conducted.
5 We do so now, adopting the step-by-step methodology for warrant redaction that was established
6 in United States v. Sells, 463 F.3d 1148 (10th Cir. 2006). First, the court must separate the
7 warrant into its constituent clauses. Id. at 1155; see also United States v. Christine, 687 F.2d
8 749, 754 (3d Cir. 1982). Second, the court must examine each individual clause to determine
9 whether it is sufficiently particularized and supported by probable cause. Sells, 463 F.3d at
10 1157. Third, the court must determine whether the valid parts are distinguishable from the non-
11 valid parts. Id. at 1158 (“some part of the warrant must be both constitutionally valid and
12 distinguishable from the invalid portions in order for severability to apply” (quotation marks
13 omitted)); Christine, 687 F.2d at 754 (“Redaction is inappropriate when the valid portions of the
14 warrant may not be meaningfully severable from the warrant as a whole.”). To be
15 distinguishable, “each of the categories of items to be seized [must] describe[] distinct subject
16 matter in language not linked to language of other categories, and each valid category [must]
17 retain[] its significance when isolated from rest of the warrant.” Sells, 463 F.3d at 1158. In sum,
18 the court must be able to excise from the warrant those clauses that fail the particularity or
19 probable cause requirements in a manner that leaves behind a coherent, constitutionally
20 compliant redacted warrant.
21 However, the warrant’s grammatical amenability to severance is not alone
22 sufficient to justify enforcement of the remainder. The district court must also determine
23 whether the valid portions make up “only an insignificant or tangential part of the warrant.”
19
1 George, 975 F.2d at 80. Even where parts of the warrant are valid and distinguishable, severance
2 may be inappropriate where, for instance, the sufficiently particularized portion is “only a
3 relatively insignificant part of a sweeping search,” United States v. Spilotro, 800 F.2d 959, 967
4 (9th Cir. 1986), or where “the warrant is generally invalid but as to some tangential item meets
5 the requirement of probable cause,” United States v. Freeman, 685 F.2d 942, 952 (5th Cir. 1982);
6 see also United States v. Kow, 58 F.3d 423, 428 (9th Cir. 1995) (severance inapplicable where
7 the constitutionally compliant part is a “relatively insignificant part of an otherwise valid
8 search”). This step of the analysis should not simply be a technical exercise of counting words
9 and phrases but, rather, “a holistic test that examines the qualitative as well as the quantitative
10 aspects of the valid portions of the warrant relative to the invalid portions.” Sells, 463 F.3d at
11 1160.
12 The district court did not articulate the mode of analysis underlying its conclusion
13 that the warrant was severable. The court appears to have concluded that the warrant could be
14 severed merely by eliminating the authorization to search for (1) evidence of unspecified state or
15 federal offenses and (2) evidence of photographs depicting sexual conduct by a minor. Those
16 two redactions, however, would not cure the warrant’s apparent overbreadth. It is important at
17 this juncture to emphasize that the only offense particularized in the warrant was failure to
18 register an internet service provider account or communication identity. The sole legal
19 predicates for a registration offense are possession and usage of an unregistered internet account
20 or communication identifier. The manner or purpose for which the internet account or identifier
21 is used – whether to send an innocuous email, post a picture on MySpace, or to lure minors in a
22 chat room – is not an element of the offense.
20
1 Even after the references to state and federal law and images of child pornography
2 are removed, there remain numerous clauses whose relationship to the registration offense is, at
3 best, unclear. After redaction of the two clauses identified above, the first and second
4 paragraphs of the warrant would still broadly authorize a search of “[a]ny computers,” “external
5 and internal drives,” “digital camera’s [sic] and their internal or external storage media,” “[a]ny
6 and all computing or data processing software,” and any electronic storage device for any
7 evidence substantiating a registration violation, without providing the forensic examiner with
8 any guidance or limitations as to what kinds of files might be relevant. Warrant 1. While those
9 provisions describe the places to be searched, they do not describe with adequate particularity
10 the “items to be seized by their relation to designated crimes.” United States v. Williams, 592
11 F.3d 511, 519 (4th Cir. 2010) (emphasis added). The third paragraph of the warrant
12 particularizes the items that the government may seize, but nothing in the current record explains
13 how the vast majority of those items – e.g., access numbers, passwords, and PINS relating to
14 voice mail systems, computing or data processing literature (including written materials), audio
15 or video cassette tape recordings, books, and magazines – could possibly reveal evidence that
16 Galpin possessed or used an unregistered internet account or communication identity.
17 Nor did the district court weigh any particularized component(s) of the warrant
18 against the invalid portions to determine whether the particularized portions were insignificant or
19 tangential in relation to the search authorization as a whole. The government asserts that
20 severance was appropriate because “[e]vidence of Galpin’s failure to register his online identity
21 . . . was a prominent aspect of the investigation and of the evidence sought to be obtained.”
22 However, while the MySpace posting led to probable cause to believe that there was a
23 registration violation, the investigation itself, and the forensic review of Galpin’s property,
21
1 focused not on his failure to register but on his activities involving young boys and suspected
2 involvement with child pornography. Mere mention of the crime that prompted the investigation
3 will not ensure that an authorization to search for evidence relating to that crime is more than an
4 insignificant or tangential element of a warrant focused on evidence of other criminal activity.
5 See, e.g., Cassady v. Goering, 567 F.3d 628, 636 (10th Cir. 2009). Rather, the court must assess
6 the relative importance on the face of the warrant of the valid and invalid provisions, weigh the
7 body of evidence that could have been seized pursuant to the invalid portions of the warrant
8 against the body of evidence that could properly have been seized pursuant to the clauses that
9 were sufficiently particularized, and consider such other factors as it deems appropriate in
10 reaching a conclusion as to whether the valid portions comprise more than an insignificant or
11 tangential part of the warrant.
12 Because the current factual record is focused principally on the proper scope and
13 conduct of a computer search for evidence of child pornography and contact with minors, the
14 district court must, on remand, develop a record as to the proper scope and conduct of a search
15 for evidence of the existence of unregistered internet accounts and internet communication
16 identifiers. That record will help to inform the court’s determination as to whether any valid
17 portions of the warrant were more than insignificant or tangential and will also be relevant to any
18 plain view and/or good faith determinations that will be necessary if the court determines that the
19 seizures or search exceeded the bounds authorized by any valid aspects of the warrant.
20 B. Plain View Doctrine
21 If, on remand, the district court again finds that the warrant was severable but that
22 the evidence of child pornography was outside the properly authorized scope of the search, it
23 will again have to address the question of whether that evidence was in plain view in the course
22
1 of the authorized search. The plain view doctrine permits an officer to seize evidence outside a
2 warrant’s authorization “when it is immediately apparent that the object is connected with
3 criminal activity, and where such search and seizure do not involve an invasion of privacy.”
4 George, 975 F.2d at 78. A quintessential example of a warrantless seizure saved by the plain
5 view doctrine is one by an officer who, acting pursuant to a valid warrant, enters a house to
6 search for a weapon used to commit a crime and seizes a bag of cocaine that he found sitting on
7 the kitchen counter. In order for the search and seizure to not involve an improper invasion of
8 privacy, however, the officer must lawfully have been in the place from which the object could
9 be seen in plain view. Minnesota v. Dickerson, 508 U.S. 366, 375 (1993). Thus, “an essential
10 predicate of the plain view doctrine is that the initial intrusion not violate the Fourth
11 Amendment.” George, 975 F.2d at 78; see also Horton v. California, 496 U.S. 128, 136 (1990).
12 The district court here held that the clause of the warrant authorizing officers to
13 search for evidence of a registration violation permitted the officers to open all of Galpin’s
14 computer and digital storage files because opening each file was the only means of determining
15 its content. However if, on remand, the district court finds that the warrant was not severable,
16 then the “initial intrusion” was unconstitutional – the entire hard drive search would have been
17 without valid authorization – and the plain view doctrine could not be invoked to validate the use
18 of any of the evidence the officers seized. The court’s determination, on remand, as to the
19 appropriate scope of the authorized search should be informed by a better-developed, more
20 relevant factual record; the court’s determination as to whether the image files that were seized
21 would have been in plain view in the conduct of that search will similarly be informed by that
22 augmented record.
23
1 Unlike the Ninth Circuit, we have not required specific search protocols or
2 minimization undertakings as basic predicates for upholding digital search warrants, and we do
3 not impose any rigid requirements in that regard at this juncture. See United States v.
4 Comprehensive Drug Testing, Inc., 621 F.3d 1162, 1176 (9th Cir. 2010) (en banc) (per curiam).
5 However, the district court’s review of the plain view issue should take into account the degree,
6 if any, to which digital search protocols target information outside the scope of the valid portion
7 of the warrant. To the extent such search methods are used, the plain view exception is not
8 available.
9 As the record is currently constituted, there is little indication as to whether the
10 forensic examiner’s search was even directed – much less properly limited – to those files that
11 would substantiate a registration violation. The district court held that the redacted warrant
12 authorized the forensic examiner to open and seize any image file because digital pictures
13 “would be relevant to whether it was actually defendant who was using an unregistered user
14 name or an e-mail account.” The district court’s speculation as to the probative value of the
15 digital pictures is unsupported by the record developed below and appears somewhat strained,
16 given that officers had determined, before even seeking the warrant, that Galpin’s I.P. address
17 was the source of the “Medic Guy” posting and the photograph of Galpin found on the child’s
18 MySpace page. The record indicates, moreover, that the investigator opened and played video
19 image files in order to determine whether they contained sexual content. Nothing in the record is
20 indicative of any possible evidentiary connection between the content of video files and the
21 possession of an unregistered internet service provider account, internet communication
22 identifier, or email address. On remand, the district court must determine whether a search
23 limited to evidence of a registration violation would have necessitated the opening of image files
24
1 or the playing of video files.9
2 C. Good Faith Exception
3 The government contends that, even if the warrant was invalid or the
4 pornographic images would not have been in plain view in the course of a properly authorized
5 search, the denial of Galpin’s suppression motion should nonetheless be upheld because the
6 investigators reasonably relied on the warrant and the accompanying affidavit when executing
7 the search.
8 In United States v. Leon, the Supreme Court recognized an exception to the
9 exclusionary rule for “evidence obtained in objectively reasonable reliance on a subsequently
10 invalidated search warrant.” 468 U.S. 897, 922 (1984). However, the Supreme Court identified
11 four circumstances in which the good faith exception to the exclusionary rule would not apply:
12 (1) where the issuing magistrate has been knowingly misled; (2) where the issuing
13 magistrate wholly abandoned his or her judicial role; (3) where the application is
14 so lacking in indicia of probable cause as to render reliance upon it unreasonable;
15 and (4) where the warrant is so facially deficient that reliance upon it is
16 unreasonable.
17 United States v. Moore, 968 F.2d 216, 222 (2d Cir. 1992) (citing Leon, 468 U.S. at 923).
18 Because the district court found that the warrant was severable and that the image files had been
19 in plain view, the district court never reached the issue of whether Leon’s good faith exception
20 applied to this case.
21 Galpin argues that the officers deliberately searched for evidence beyond the
22 scope of the probable cause supporting the warrant and thus did not act in good faith. He also
9
Paragraph 3(e) of the warrant authorized a search for “records or correspondence
related to the possession, transmission, collection, trading or production of [child
pornography].” As explained above, we affirm the district court’s uncontested
determination that there was no probable cause to search for child pornography.
25
1 argues that the warrant application was so lacking in indicia of probable cause, and the face of
2 the warrant was so plainly overbroad, that no officer could reasonably have relied on the warrant
3 when executing the search. The district court’s only finding on point was its conditional
4 determination – which the court did not revisit at or after the evidentiary hearing – that the pre-
5 evidentiary hearing record revealed no evidence of deliberate police misconduct. That finding,
6 in any event, only relates to the first of the four circumstances the Leon Court identified as
7 foreclosing the good faith exception.
8 The district court did not address the question of whether the warrant, which
9 purported to authorize a search for violations of “NYS Penal Law or Federal statutes,” was “so
10 facially deficient that reliance upon it [was] unreasonable.” See United States v. Moore, 968 F.2d
11 at 222; cf. George, 975 F.2d at 77 (holding that, “[s]ince it was quite clear when [the subject]
12 warrant was executed that ‘limits’ to a search consisting only of a broad criminal statute were
13 invalid, a fortiori, a warrant not limited in scope to any crime at all is so unconstitutionally broad
14 that no reasonably well-trained police officer could believe otherwise”). Nor has the district
15 court yet had occasion to address the implications for the good faith inquiry of its finding (which
16 we affirm) that the application did not establish probable cause for a search for child
17 pornography.
18 Here, there is ample evidence that investigators sought evidence beyond the scope
19 of the one crime that was particularized in the warrant application and for which the application
20 supplied probable cause. The forensic examiner testified that, having reviewed a report on the
21 entire investigation, she was looking for images of “younger . . . males,” “regardless of whether
22 they’re pornographic or not,” that she read individual “documents,” that she opened and
23 reviewed video files, and that she set up a search filter that identified child pornography websites
26
1 Galpin had visited. Indeed, during cross-examination, the examiner confirmed that she went
2 beyond the files that had been identified as potentially indicative of contact with the victims
3 whose names she had been given. Galpin’s defense attorney asked: “[A]ssume that [the files
4 identified by targeted searches] comprise[] two percent of all the material that’s on the hard drive
5 and the other 98 percent has nothing to do with any of those names . . . . So you look through
6 [the other 98 percent of the files]?” The forensic examiner responded, “[a]bsolutely.”
7 Should the district court determine that neither severability nor the plain view
8 doctrine supports denial of the suppression motion, it will have to determine whether,
9 notwithstanding the exceptions delineated in United States v. Leon, the motion can be denied on
10 the ground that the officers acted in good faith.
11 CONCLUSION
12 Accordingly, we AFFIRM the district court’s determination that the warrant
13 application failed to establish probable cause to search for evidence of child pornography, and its
14 determination that the warrant’s references to the New York State Penal Law and “Federal
15 Statutes” were impermissibly broad. We VACATE the judgment in all other respects and
16 REMAND the case for further proceedings consistent with this opinion.
27
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} |
An unpublished opinion of the North Carolina Court of Appeals does not constitute
controlling legal authority. Citation is disfavored, but may be permitted in accordance with
the provisions of Rule 30(e)(3) of the North Carolina Rules of Appellate Procedu re.
IN THE COURT OF APPEALS OF NORTH CAROLINA
No. COA14-680
Filed: 2 June 2015
Mecklenburg County, No. 12 CRS 227341
STATE OF NORTH CAROLINA
v.
SALVADOR QUINONEZ.
Appeal by defendant from judgment entered 19 September 2013 by Judge
James W. Morgan in Mecklenburg County Superior Court. Heard in the Court of
Appeals 4 November 2014.
Attorney General Roy Cooper, by Assistant Attorney General Benjamin J. Kull,
for the State.
Glover & Petersen, P.A., by Ann B. Petersen, for defendant-appellant.
CALABRIA, Judge.
Salvador Quinonez (“defendant”) appeals from a judgment entered upon a jury
verdict finding him guilty of trafficking in methamphetamine by transport.
Defendant challenges the denial of his motion to suppress as well as his sentence.
We find no error.
I. Background
STATE V. QUINONEZ
Opinion of the Court
On 20 June 2012, Special Agent Jorge Alamillo (“Agent Alamillo”) of the Drug
Enforcement Administration (“DEA”) received information from a confidential
informant (“the informant”) indicating that a person known as “Tarahumara” had
contacted the informant and wanted to sell a large amount of methamphetamine.
Agent Alamillo instructed the informant to set up the sale for the next day, and the
DEA would conduct an operation to apprehend Tarahumara.
The next day, 21 June 2012, the informant was scheduled to meet Tarahumara
in a Ross parking lot in Concord, North Carolina. A dark Mitsubishi Lancer (“the
Lancer”) driven by an Hispanic female entered the parking lot and parked next to the
informant’s vehicle. Defendant spoke briefly with the informant, then returned to
the Lancer’s passenger seat. The informant drove out of the parking lot, and the
Lancer followed the informant’s vehicle. Agent Alamillo relayed the Lancer’s license
plate number to the other law enforcement officers involved in the operation.
Officer Chris Newman (“Officer Newman”) of the Charlotte-Mecklenburg
Police Department (“CMPD”) was assisting the DEA agents in the operation. Officer
Newman observed the Lancer travelling below the speed limit on North Tryon Street
before it traversed across two lanes of travel, causing other vehicles behind it to slow
down. Officer Newman stopped the Lancer and spoke with both the female driver
and with defendant. The female driver consented to a search of the Lancer, during
which Officer Newman and his K-9 partner discovered perfume boxes in the back
-2-
STATE V. QUINONEZ
Opinion of the Court
seat. The K-9 unit indicated a positive alert to the perfume boxes, which contained
approximately one pound of methamphetamine. Law enforcement seized both the
Lancer and the perfume boxes containing the methamphetamine.
Defendant was arrested and charged with two counts of trafficking in
methamphetamine and possession with intent to sell or deliver a controlled
substance. Agent Alamillo interviewed defendant subsequent to his being taken into
custody. During the interview, defendant indicated that he had received the
methamphetamine that was found in the Lancer from an Hispanic male in
Greensboro. Defendant also offered to identify three locations where individuals were
storing drugs. Agent Alamillo and CMPD Officer Paul Brent Foushee (“Officer
Foushee”), accompanied defendant to Greensboro, where defendant identified three
houses as “stash locations.” Subsequent DEA investigations into those locations
resulted in four arrests as well as the seizure of 2.3 pounds of methamphetamine,
266 grams of cocaine, and a firearm.
On 25 March 2013, defendant filed a motion to suppress the stop of the Lancer,
the methamphetamine law enforcement discovered in the vehicle, and defendant’s
subsequent statements to law enforcement. At the hearing on defendant’s motion to
suppress, the State presented evidence from Agent Alamillo, Officer Newman, and
Officer Foushee. Defendant also testified at the hearing. On 17 September 2013, the
trial court denied defendant’s motion to suppress.
-3-
STATE V. QUINONEZ
Opinion of the Court
At trial, the State presented evidence from the informant, Agent Alamillo, and
Officer Newman. On 19 September 2013, the jury found defendant guilty of one count
of trafficking in methamphetamine, and not guilty of the other offenses. The trial
court sentenced defendant to a minimum of 225 months and a maximum of 279
months in the custody of the North Carolina Division of Adult Correction. Defendant
appeals.
II. Motion to Suppress
On appeal, defendant argues that there was no reasonable suspicion to support
the traffic stop. Specifically, defendant contends that the trial court’s finding that
the vehicles behind the Lancer were required to apply their brakes quickly to avoid a
collision is unsupported by the evidence. We disagree.
“The standard of review regarding a trial court’s decision with respect to a
motion to suppress is ‘whether competent evidence supports the trial court’s findings
of fact and whether the findings of fact support the conclusions of law.’” State v.
Armstrong, ___ N.C. App. ___, ___, 762 S.E.2d 641, 643 (2014) (citation omitted).
“[T]he trial court's findings of fact are conclusive on appeal if supported by competent
evidence, even if the evidence is conflicting.” State v. Allen, 197 N.C. App. 208, 210,
676 S.E.2d 519, 521 (2009) (citation omitted). Findings not challenged on appeal are
deemed supported by competent evidence and are binding on appeal. State v. Biber,
-4-
STATE V. QUINONEZ
Opinion of the Court
365 N.C. 162, 168, 712 S.E.2d 874, 878 (2011). “Conclusions of law are reviewed de
novo [.]” Id.
In Whren [v. United States, 517 U.S. 806, 135 L.Ed.2d 89
(1996)], the United States Supreme Court held that the
temporary detention of a motorist upon probable cause to
believe that he has violated a traffic law is not inconsistent
with the Fourth Amendment's prohibition against
unreasonable seizures, even if a reasonable officer would
not have stopped the motorist for the violation.
State v. McClendon, 350 N.C. 630, 635, 517 S.E.2d 128, 131 (1999). Reasonable
suspicion is the appropriate standard in determining whether a traffic stop is
appropriate. State v. Styles, 362 N.C. 412, 416, 665 S.E.2d 438, 441 (2008).
“Reasonable suspicion is a less demanding standard than probable cause and requires
a showing considerably less than preponderance of the evidence.” Id. at 414, 665
S.E.2d at 439 (citation and quotation marks omitted).
Defendant relies upon Styles, State v. Ivey, 360 N.C. 562, 633 S.E.2d 459 (2006),
and State v. McRae, 203 N.C. App. 319, 691 S.E.2d 56 (2010), to support his argument
that Officer Newman lacked reasonable suspicion to initiate the traffic stop.
Specifically, defendant contends that there was no evidence supporting a violation of
N.C. Gen. Stat. § 20-154 and the record is silent on whether the Lancer signaled
before changing lanes.
In Ivey, the Court applied the probable cause standard to hold that the stop
was unlawful. 360 N.C. 562, 565-66, 633 S.E.2d 459, 461-62. However, Ivey was
-5-
STATE V. QUINONEZ
Opinion of the Court
abrogated by Styles, which held that reasonable suspicion is the proper standard in
determining whether a stop is lawful. 362 N.C. at 415, 665 S.E.2d at 440. In Styles,
the defendant argued that the stop in that case was improper because there was no
evidence that the movement of his vehicle could have affected the operation of
another vehicle pursuant to N.C. Gen. Stat. § 20-154(a). 362 N.C. at 416, 665 S.E.2d
at 441. The Supreme Court of North Carolina determined that “changing lanes
immediately in front of another vehicle may affect the operation of the trailing
vehicle[,]” and therefore the law enforcement officer’s observation of the defendant’s
vehicle changing lanes without signaling provided the required reasonable suspicion
to stop the defendant’s vehicle. Id. at 417, 665 S.E.2d at 441.
In McRae, law enforcement received a tip from a confidential source that the
defendant would be driving a green vehicle with over 60 grams of cocaine. 203 N.C.
App. at 320, 691 S.E.2d at 57. The defendant was stopped when a law enforcement
officer witnessed him turn into a gas station parking lot without using his turn signal.
Id., 691 S.E.2d at 57-58. On appeal, the defendant argued that the trial court erred
in concluding that his failure to use his turn signal justified the stop. Id. at 322, 691
S.E.2d at 58. This Court held that the trial court properly concluded that a
reasonable officer would have believed that the failure to use a turn signal could have
affected another motor vehicle, and therefore the law enforcement officer had
reasonable suspicion to stop the defendant. Id. at 323, 691 S.E.2d at 59.
-6-
STATE V. QUINONEZ
Opinion of the Court
In the instant case, Officer Newman testified that he observed the Lancer
travelling approximately five to ten miles slower than the posted speed limit. He
then observed the Lancer travel across two lanes of traffic in order to reach an exit
lane. Officer Newman stated that the Lancer “cut over in front of some vehicles,
causing traffic to slow way down, backing up traffic” and that about fifteen other
vehicles were affected by the Lancer’s movement. He also testified that the Lancer
“made an unsafe movement without turning or starting from a direct point in which
a lane change could be done safely.”
Defendant is correct that the record does not include evidence regarding
whether the driver activated her turn signal or looked to see if the movement could
be conducted safely before she changed lanes. However, Officer Newman did not need
probable cause to stop the Lancer. Instead, he only needed reasonable suspicion that
an unsafe movement occurred. Because Officer Newman observed the Lancer
travelling at approximately ten miles per hour below the posted speed limit before it
crossed two lanes of traffic, causing other vehicles on the road to slow down, he had
reasonable suspicion that the driver of the Lancer did not check to see whether the
movement could be made safely without affecting other vehicles on the road. The
trial court’s findings that the Lancer slowed to approximately ten miles per hour
below the speed limit and abruptly crossed two lanes of traffic, causing other vehicles
to slow down is supported by Officer Newman’s testimony. Therefore, the trial court
-7-
STATE V. QUINONEZ
Opinion of the Court
appropriately concluded that there was reasonable suspicion to stop the Lancer based
upon the information given by the informant and the traffic law violation, and
properly denied defendant’s motion to suppress.
III. Sentencing
Defendant also argues that the trial court erred in concluding that the
assistance that he gave law enforcement in locating other known drug locations in
the Greensboro area was not substantial. Specifically, defendant contends that he
should have been granted a lesser sentence because of his assistance to law
enforcement.
“This Court has held that whether a trial court finds that a criminal
defendant’s aid amounts to ‘substantial assistance’ is discretionary. The reduction of
the sentence is also in the judge’s discretion, even if the judge finds substantial
assistance was given.” State v. Robinson, 177 N.C. App. 225, 232, 628 S.E.2d 252,
256 (2006) (citations and quotation marks omitted). “To overturn a sentencing
decision, the reviewing court must find an abuse of discretion, procedural conduct
prejudicial to defendant, circumstances which manifest inherent unfairness and
injustice, or conduct which offends the public sense of fair play.” Id. at 232-33, 628
S.E.2d at 256-57 (citation and internal quotation marks omitted). “A trial court may
be reversed for an abuse of discretion only upon a showing that its ruling was so
-8-
STATE V. QUINONEZ
Opinion of the Court
arbitrary that it could not have been the result of a reasoned decision.” State v.
Wilson, 313 N.C. 516, 538, 330 S.E.2d 450, 465 (1985).
N.C. Gen. Stat. § 90-95(h)(5) provides that a sentencing judge
may reduce the fine, or impose a prison term less than the
applicable minimum prison term provided by this
subsection, or suspend the prison term imposed and place
a person on probation when such person has, to the best of
his knowledge, provided substantial assistance in the
identification, arrest, or conviction of any accomplices,
accessories, co-conspirators, or principals if the sentencing
judge enters in the record a finding that the person to be
sentenced has rendered such substantial assistance.
N.C. Gen. Stat. § 90-95(h)(5) (2013) (emphasis added). “In other words, N.C. Gen.
Stat. 90-95(h)(5) is a provision exchanging potential leniency for assistance . . . . It is
the only provision in the trafficking statutory scheme which gives a sentencing judge
the discretion not to impose the statutorily mandated minimum sentence and fine.”
State v. Steele, 201 N.C. App. 689, 694, 689 S.E.2d 155, 160 (2010) (citation and
internal quotation marks omitted). “Furthermore, our courts have recognized that
the ‘substantial assistance’ statute is permissive, not mandatory, and that defendant
has no right to a lesser sentence even if he does provide what he believes to be
substantial assistance.” State v. Kamtsiklis, 94 N.C. App. 250, 260, 380 S.E.2d 400,
405 (1989) (citation omitted).
In the instant case, defendant identified three locations to law enforcement
where individuals were storing drugs. As a result of subsequent investigations into
-9-
STATE V. QUINONEZ
Opinion of the Court
those locations, officers arrested four individuals and recovered 2.3 pounds of
methamphetamine, 266 grams of cocaine, and a firearm. Defendant did not
participate in any undercover drug buys or interact with the investigation beyond
identifying the locations to Agent Alamillo and Officer Foushee. At sentencing, the
trial court found that “[b]ased on the evidence presented at trial, considering the
arguments of counsel for the State and for the defendant, I understand that while the
defendant did offer assistance, that this assistance is not substantial and that the
sentence in the statutory range is justified.”
Defendant contends that the trial court’s language indicates that the trial court
did not make an independent ruling that defendant’s assistance was not substantial
within the meaning of N.C. Gen. Stat. § 90-95(h)(5). However, the evidence presented
included evidence concerning defendant’s assistance in the identification of the “stash
locations” and the subsequent arrest of suspects. Defendant has no right to a lesser
sentence even if he provided what he believes to be substantial assistance,
Kamtsiklis, 94 N.C. App. at 260, 380 S.E.2d at 405, and the trial court’s finding
indicates that it reached a reasoned decision and considered defendant’s assistance
to law enforcement before sentencing him in the statutory range. Defendant’s
argument is without merit.
IV. Conclusion
- 10 -
STATE V. QUINONEZ
Opinion of the Court
Officer Newman had reasonable suspicion to stop the Lancer due to his
observation of the Lancer’s unsafe movement in traffic. Therefore, the trial court
properly denied defendant’s motion to suppress the evidence of the
methamphetamine as well as defendant’s subsequent statements. Additionally, the
trial court did not abuse its discretion in considering defendant’s assistance to law
enforcement before sentencing him in the presumptive range. We hold that
defendant received a fair trial, free from error.
NO ERROR.
Judges STROUD and McCULLOUGH concur.
Report per Rule 30(e).
- 11 -
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 02-4262
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
versus
PARIS TIWAND PULLEY,
Defendant - Appellant.
Appeal from the United States District Court for the Eastern
District of North Carolina, at Raleigh. James C. Fox, Senior
District Judge. (CR-93-121-FO)
Submitted: September 27, 2002 Decided: October 10, 2002
Before WILKINS and TRAXLER, Circuit Judges, and HAMILTON, Senior
Circuit Judge.
Affirmed by unpublished per curiam opinion.
Thomas P. McNamara, Federal Public Defender, G. Alan DuBois,
Assistant Federal Public Defender, Raleigh, North Carolina, for
Appellant. Frank D. Whitney, United States Attorney, Christine
Witcover Dean, Assistant United States Attorney, Anne M. Hayes,
Assistant United States Attorney, Raleigh, North Carolina, for
Appellee.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Paris Tiwand Pulley appeals from the sixty-month sentence he
received for the revocation of his supervised release. On appeal,
he alleges that the sentence was unreasonable and that he should
have been sentenced within the guideline range of thirty to thirty-
seven months as calculated under U.S. Sentencing Guidelines Manual
(“USSG”) § 7B1.4(a) (2001). We affirm Pulley’s sentence as the
guideline range in USSG § 7B1.4(a) is advisory only, United States
v. Davis, 53 F.3d 638, 640-41 (4th Cir. 1995), and the sentence
imposed was not unreasonable. We dispense with oral argument as
the facts and legal contentions are adequately presented in the
materials before the court and argument would not aid the
decisional process.
AFFIRMED
2
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593 N.W.2d 350 (1999)
1999 ND 93
Diane E. SCHOENWALD, Plaintiff and Appellant,
v.
Eugene Robert SCHOENWALD, Defendant and Appellee.
No. 980253.
Supreme Court of North Dakota.
May 19, 1999.
*352 Faron E. Terry, Minot, N.D., for plaintiff and appellant.
Donald L. Peterson, Kenner Sturdevant Peterson & Cresap, P.C., Minot, N.D., for defendant and appellee.
SANDSTROM, Justice.
[¶ 1] Diane Schoenwald appeals from the judgment of the district court awarding her spousal support and dividing property. Because the district court's spousal support award and property division are not clearly erroneous, we affirm.
I
[¶ 2] Diane and Eugene Schoenwald were married in 1969 and have no minor children. In June 1997, Diane Schoenwald filed for divorce. During their marriage, the couple owned a farmstead, livestock, machinery, and other real estate, much of which was encumbered. At the time of the divorce, they were heavily in debt, and much of the property was in need of repair. There was little agreement between them about disposition of the property.
[¶ 3] During the marriage, Eugene Schoenwald worked for the Burlington Northern Sante Fe Railroad. At the time of the divorce, he testified he was netting between $1400 and $1500 per month, after certain expenses and loans were paid from his check. The couple also farmed, but not profitably, having lost an average of $19,000 a year from 1993 to 1996. Diane Schoenwald has an eighth grade education and had not earned any significant income in the four years preceding the divorce. She has done some babysitting and farming.
[¶ 4] As part of the divorce decree, the district court awarded Diane Schoenwald $700 per month in spousal support until Eugene Schoenwald retires from Burlington Northern Sante Fe. She is also to receive $500 a month upon his retirement, for as long as she is eligible under the Railroad Retirement Act. The court disposed of the personal property of the parties by ordering Eugene Schoenwald to pay Diane Schoenwald for the value of half of their personal property, ordering the sale of their real property and a split of the proceeds, and allowing the parties to keep certain property.
[¶ 5] Diane Schoenwald appeals from the judgment of the Northwest Judicial District Court. The district court had jurisdiction under N.D.C.C. § 27-05-06. This Court has jurisdiction under N.D. Const. art. VI, § 6, and N.D.C.C. § 28-27-01.
II
[¶ 6] Diane Schoenwald contests both the amount of spousal support she is to receive from Eugene Schoenwald and the district court's division of property. "[P]roperty division and spousal support are interrelated, and often must be considered together." Lohstreter v. Lohstreter, 1998 ND 7, ¶ 16, 574 N.W.2d 790.
A
[¶ 7] In Hogue v. Hogue, we restated the standard of review for spousal support:
Determinations of spousal support are findings of fact, and the trial court's determination will not be set aside unless it is clearly erroneous. Orgaard v. Orgaard, 1997 ND 34, ¶ 5, 559 N.W.2d 546. A finding is clearly erroneous only if it is induced by an erroneous view of the law, if there is no evidence to support a finding, or if, although there is some evidence to support it, on the entire evidence, we are left with a firm conviction a mistake has been made. Van Klootwyk v. Van Klootwyk, 1997 ND 88, ¶ 13, 563 N.W.2d 377.
When making a spousal support determination, the trial court must consider the relevant factors under the Ruff-Fisher [sic] guidelines. Lohstreter v. Lohstreter, *353 1998 ND 7, ¶ 25, 574 N.W.2d 790. Considered under the Ruff-Fisher [sic] guidelines are: "`the respective ages of the parties, their earning ability, the duration of the marriage and conduct of the parties during the marriage, their station in life, the circumstances and necessities of each, their health and physical condition, their financial circumstances as shown by the property owned at the time, its value at the time, its income-producing capacity, if any, whether accumulated before or after the marriage, and such other matters as may be material.'" Van Klootwyk, 1997 ND 88, ¶ 14, 563 N.W.2d 377 (quoting Weir v. Weir, 374 N.W.2d 858, 862 (N.D.1985)).
1998 ND 26, ¶¶ 24-25, 574 N.W.2d 579. Although the district court is not required to make specific findings, it must provide a rationale for its decision. Id. at ¶ 25.
[¶ 8] The district court awarded Diane Schoenwald $700 a month spousal support until Eugene Schoenwald retires. In deciding spousal support, the district court "considered the so-called Ruff-Fischer guidelines and [found] that [Diane Schoenwald] is disadvantaged" and also found "[Eugene Schoenwald's] earning ability, health and physical condition, and conduct during the marriage favor an order of spousal support in favor of [Diane Schoenwald]."
[¶ 9] In deciding spousal support, the district court must consider the needs of the disadvantaged spouse and the supporting spouse's needs and ability to pay. Mahoney v. Mahoney, 1997 ND 149, ¶ 28, 567 N.W.2d 206 (citing Heley v. Heley, 506 N.W.2d 715, 720 (N.D.1993)).
[¶ 10] Because the support is to end when Eugene Schoenwald retires, the award is not permanent, but temporary. Although the district court's findings of fact and conclusions of law regarding spousal support are short and without much explanation, the court's decision focused on the Ruff-Fischer guidelines and Diane Schoenwald being disadvantaged.
[¶ 11] There is evidence to support the finding Diane Schoenwald was disadvantaged by the marriage. Trial testimony established she had not worked outside the home in quite some time and had primarily cared for the couple's farm and family. During the course of the marriage, Eugene Schoenwald was the primary wage-earner, with most of his earnings coming from his employment with Burlington Northern Sante Fe Railroad. He testified his take-home pay was between $1400 and $1500 per month. In considering these facts, the district court awarded Diane Schoenwald $700 per month until Eugene Schoenwald retires.
[¶ 12] Diane Schoenwald argues the amount is too low, considering Eugene Schoenwald's income. We do not substitute our judgment for that of the district court, and we reverse only if the award is clearly erroneous. Peterson Mechanical, Inc. v. Nereson, 466 N.W.2d 568, 571 (N.D.1991). The support award was roughly half of Eugene Schoenwald's take-home pay. Considering his pending retirement and Diane Schoenwald's entitlement to part of his retirement annuity under the Railroad Retirement Act, we conclude the award of $700 temporary spousal support is not clearly erroneous.
B
[¶ 13] The district court awarded Diane Schoenwald $500 per month upon Eugene Schoenwald's retirement. Although Diane Schoenwald has not challenged the award of $500, the issue was discussed at oral argument. The funds from which $500 was awarded are considered property. See Belt v. Belt, 398 N.W.2d 737, 739 (N.D.1987) (Tier II benefits are divisible property.).
[¶ 14] The district court found:
That upon [Eugene Schoenwald's] retirement from the Burlington Northern Sante Fee [sic] Railroad, Plaintiff Diane Schoenwald, is awarded and the Railroad Retirement Board is directed to pay an interest in the portion of Defendant Eugene R. Schoenwald's benefits under the Railroad Retirement Act (45 U.S.C. § 231, et seq.) which may be divided as provided by section 14 of the Railroad Retirement Act (45 U.S.C. § 231m). Plaintiff Diane E. Schoenwald's share shall be computed as an amount equal to $500.00 of [Eugene Schoenwald's] monthly divisible benefits *354 for as long as she shall be eligible under said Railroad Retirement Act.
[¶ 15] Because Eugene Schoenwald is a railroad employee, he is covered by federal statute. The Railroad Retirement Act provides a system of retirement and disability benefits to railroad industry employees and their families. 45 U.S.C. § 231 et seq. The Act's scheme provides for two "tiers" of benefits resembling both a private pension program and a social welfare plan. Tier I benefits are equivalent to those an employee would receive if covered by the Social Security Act, 42 U.S.C. § 401 et seq. Tier II benefits are supplemental annuities that, like a private pension plan, are tied to earnings and career service. See 45 U.S.C. § 231a(b) and § 231b(e).
[¶ 16] Tier I benefits are based upon a railroad employee's employment both within and outside of the railroad industry. See 45 U.S.C. § 231b(a). This basic component is designed to provide benefits equivalent to the old age insurance benefit or disability insurance benefit that would have been received under the Social Security Act. See Belt, 398 N.W.2d at 738 (citing Hisquierdo v. Hisquierdo, 439 U.S. 572, 574-75, 99 S.Ct. 802, 59 L.Ed.2d 1 (1979)); see also Olson v. Olson, 445 N.W.2d 1, 6-7 (N.D.1989). The statute provides that "no annuity or supplemental annuity shall be assignable or be subject to any tax or to garnishment, attachment, or other legal process under any circumstances whatsoever, nor shall the payment thereof be anticipated." 45 U.S.C. § 231m.
[¶ 17] In Hisquierdo, 439 U.S. 572, 99 S.Ct. 802, 59 L.Ed.2d 1, the United States Supreme Court considered whether an award of railroad retirement benefits to a spouse, when dividing marital assets upon divorce, was prohibited by federal law. The United States Supreme Court held that pension benefits earned under the Railroad Retirement Act could not be treated as marital property and divided by a state court when a railroad employee divorced. See Belt, 398 N.W.2d at 738 (discussing the Hisquierdo decision). The United States Supreme Court held section 231m prohibited the division of benefits payable under the Railroad Retirement Act as "property" upon divorce. Hisquierdo, at 589, 99 S.Ct. 802.
[¶ 18] Following Hisquierdo, Congress amended section 231m of 45 U.S.C. The amendment expressly permits supplemental annuity, or Tier II benefits, to be distributed upon divorce. Tier II benefits are based only upon a railroad employee's employment in the railroad industry. Belt, 398 N.W.2d at 738. These benefits are comparable to pension benefits paid over and above Social Security to workers in other industries. Id. "The amendment expressly permits characterization of Tier II benefits as `community property' subject to distribution upon divorce." Id. at 739 (citing 45 U.S.C. § 231m(b)(2)). Significantly, however, Congress did not change the law regarding Tier I benefits. The law remains unchanged, and the Supreme Court's decision in Hisquierdo that Tier I benefits may not be treated as marital property subject to division remains law.
[¶ 19] In Belt, 398 N.W.2d at 739, this Court upheld an award of two-thirds of the Tier II benefits to the nonrailroad-employee spouse. In this case, Eugene Schoenwald's divisible-annuity, Tier II benefits total approximately $709. The $500 awarded to Diane Schoenwald is more than two-thirds of $709. Neither party complains. The district court's award of $500 per month as part of the property settlement is not erroneous.
III
[¶ 20] Diane Schoenwald argues the district court erred in dividing the couple's property. Our standard of review for property division is similar to the standard for spousal support: "`The trial court must make an equitable distribution of the marital property, based upon the facts and circumstances of each individual case. The court's determinations on valuation and division of property are findings of fact that will only be reversed on appeal if they are clearly erroneous.'" Wilhelm v. Wilhelm, 1998 ND 140, ¶ 11, 582 N.W.2d 6 (quoting Lohstreter, 1998 ND 7, ¶ 16, 574 N.W.2d 790) (citations omitted); see also N.D.C.C. § 14-05-24.
*355 [¶ 21] In dividing the property of the parties, the district court awarded almost all of the parties' personal property to Eugene Schoenwald and ordered him to pay Diane Schoenwald $15,381half the value of the property. The court also ordered the real estate of the parties, including all rural property and a house in Minot, be appraised by a qualified professional appraiser of Eugene Schoenwald's choice and then sold for no less than 80 percent of the appraised value. After paying the costs, any and all money is to be applied against any debts of the parties, and the balance is to be split with Diane Schoenwald. Eugene Schoenwald was also directed to sell all the livestock and a boat and trailer and split the proceeds with Diane Schoenwald. The district court allowed each party to keep certain property.
[¶ 22] Diane Schoenwald argues the property division was clearly erroneous because she wants the farm. Because she wants to keep the farm, she argues the court should not be allowed to order it sold and the proceeds divided. This case is distinguishable, however, from cases such as Gibbon v. Gibbon, 1997 ND 210, ¶ 7, 569 N.W.2d 707, where this Court recognized the importance of preserving an economically viable business operation like a family farm. See Linrud v. Linrud, 552 N.W.2d 342 (N.D.1996); Heley v. Heley, 506 N.W.2d 715 (N.D.1993); Pankow v. Pankow, 371 N.W.2d 153 (N.D.1985); Graves v. Graves, 340 N.W.2d 903 (N.D. 1983); Urlaub v. Urlaub, 325 N.W.2d 234 (N.D.1982); Williams v. Williams, 302 N.W.2d 754 (N.D.1981).
[¶ 23] In property division cases, we generally start with the view that marital property should be equally divided, and although the division need not be exactly equal to be equitable, the trial court must explain any substantial disparity. Christmann v. Christmann, 1997 ND 209, ¶ 6, 570 N.W.2d 221 (citing Kluck v. Kluck, 1997 ND 41, ¶ 25, 561 N.W.2d 263). In Christmann, at ¶ 7 (citing Linrud v. Linrud, 552 N.W.2d 342, 346 (N.D.1996)), we recognized that long-term marriages support an equal distribution of property and upheld the trial court's order the property be liquidated and divided equally between the parties. We do the same here.
[¶ 24] There is no disparity in the amount awarded each party, and we cannot conclude this equal division of the couple's property was clearly erroneous.
IV
[¶ 25] Diane Schoenwald's other arguments are without merit, and the judgment of the district court is affirmed.
[¶ 26] VANDE WALLE, C.J., and NEUMANN, MARING and KAPSNER, JJ., concur.
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[Cite as OneWest Bank, FSB v. Albert, 2014-Ohio-2158.]
COURT OF APPEALS
STARK COUNTY, OHIO
FIFTH APPELLATE DISTRICT
ONEWEST BANK, FSB : JUDGES:
:
: Hon. W. Scott Gwin, P.J.
Plaintiff-Appellee : Hon. Sheila G. Farmer, J.
: Hon. Patricia A. Delaney, J.
-vs- :
: Case No. 2013CA00180
:
DIANA L. ALBERT :
:
:
Defendant-Appellant : OPINION
CHARACTER OF PROCEEDING: Appeal from the Stark County Court of
Common Pleas, General Division Case
No. 2011CV03450
JUDGMENT: AFFIRMED
DATE OF JUDGMENT ENTRY: May 12, 2014
APPEARANCES:
For Plaintiff-Appellee: For Defendant-Appellant:
MONICA LEVINE LACKS MARK E. OWENS
DUSTIN D. GODENSWAGER J.P. AMOURGIS & ASSOCIATES
MCGLINCHEY STAFFORD LLC 3200 W. Market St., Suite 106
25550 Chagrin Blvd., Suite 406 Akron, OH 44333
Cleveland, OH 44122
Stark County, Case No. 2013CA00180 2
Delaney, J.
{¶1} Defendant-Appellant Diana L. Albert appeals the August 6, 2013 judgment
entry of the Stark County Court of Common Pleas, General Division. Plaintiff-Appellee is
OneWest Bank, FSB.
FACTS AND PROCEDURAL HISTORY
{¶2} On June 26, 2006, Defendant-Appellant Diana L. Albert executed a Note
in the amount of $84,000.00. The Note was secured by a Mortgage on real property
located at 2512 - 12th Street N.W., Canton, Ohio 44708. The lender was Quicken
Loans, Inc.
{¶3} Quicken Loans, Inc. endorsed the Note to IndyMac Bank, F.S.B. IndyMac
Bank F.S.B. endorsed the Note in blank. IndyMac is a division of OneWest Bank. On
October 14, 2011, Mortgage Electronic Registrations Systems, Inc., as nominee for
Quicken Loans, Inc. assigned the Mortgage to Plaintiff-Appellee OneWest Bank, FSB.
OneWest Bank is in possession of the Note and Mortgage.
{¶4} On October 27, 2011, OneWest Bank filed a complaint in foreclosure
against Albert. The complaint alleged Albert was in default of the terms of the Note and
Mortgage. OneWest Bank attempted to serve the complaint on Albert at the 12th Street
property address listed in the Note and Mortgage. OneWest Bank failed to obtain
service on Albert at the 12th Street address. On December 28, 2011, OneWest Bank
completed service on Albert at an address located at 51st Street, Canton, Ohio.
{¶5} Albert filed a motion for leave to plead on January 19, 2012 and her
answer was filed on February 10, 2012. Relevant to this appeal, Albert raised as an
affirmative defense in her answer that OneWest Bank “failed to give the proper and
Stark County, Case No. 2013CA00180 3
requisite notices to Defendant pursuant to RESPA and the terms of the Note and
Mortgage.”
{¶6} On June 15, 2012, the case was placed on an automatic bankruptcy stay.
The case was returned to the active docket on November 15, 2012.
{¶7} OneWest Bank filed a motion for summary judgment on November 13,
2012. In support of its motion for summary judgment, OneWest Bank submitted the
affidavit of Lisa Marie Gonzalez, assistant secretary for OneWest Bank. She averred
that she had personal knowledge of the file and loan history of Albert’s Note and
Mortgage held and serviced by OneWest Bank. Gonzalez stated that on August 31,
2011, One West Bank provided Albert with written notice of default and informed her of
OneWest Bank’s intent to accelerate the debt. A copy of the August 31, 2011 default
notice was attached to Gonzalez’s affidavit as Exhibit D. The default notice letter states
that IndyMac Mortgage Services, a Division of OneWest Bank, sent the written default
notice by first-class certified mail to Albert at the 51st Street address.
{¶8} Albert responded to the motion for summary judgment. She argued there
was a genuine issue of material fact whether OneWest Bank was entitled to judgment in
foreclosure because OneWest Bank failed to meet all the conditions precedent under
the Note and Mortgage. Albert submitted her affidavit stating she never received written
notice of default and the intent to accelerate the debt.
{¶9} On July 23, 2013, the trial court granted OneWest Bank’s motion for
summary judgment. On August 6, 2013, the judgment entry granting the motion for
summary judgment and decree in foreclosure were filed. It is from this judgment Albert
now appeals.
Stark County, Case No. 2013CA00180 4
ASSIGNMENTS OF ERROR
{¶10} Albert raises two Assignments of Error:
{¶11} “I. THE TRIAL COURT ERRED IN GRANTING SUMMARY JUDGMENT
TO THE PLAINTIFF/APPELLEE ONEWEST BANK, FSB, AS PLAINTIFF’S AFFIDAVIT
WAS DEFECTIVE AND INADMISSIBLE UNDER CIV.R. 56(E).
{¶12} “II. THE TRIAL COURT ERRED WHEN IT GRANTED SUMMARY
JUDGMENT TO THE PLAINTIFF/APPELLEE ONEWEST BANK, AS THERE WERE
GENUINE ISSUES OF MATERIAL FACT REMAINING AND THE PLAINTIFF WAS
NOT ENTITLED TO SUMMARY JUDGMENT AS A MATTER OF LAW.”
ANALYSIS
I. and II.
Standard of Review
{¶13} We consider Albert’s two Assignments of Error together because they
raise interrelated issues. Albert’s two Assignments of Error regard the trial court’s grant
of summary judgment in favor of OneWest Bank. We refer to Civ.R. 56(C) in reviewing a
motion for summary judgment which provides, in pertinent part:
Summary judgment shall be rendered forthwith if the pleading,
depositions, answers to interrogatories, written admissions, affidavits,
transcripts of evidence in the pending case and written stipulations of fact,
if any, timely filed in the action, 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. * * * A summary judgment shall not be rendered unless it
appears from such evidence or stipulation and only from the evidence or
Stark County, Case No. 2013CA00180 5
stipulation, that reasonable minds can come to but one conclusion and
that conclusion is adverse to the party against whom the motion for
summary judgment is made, such party being entitled to have the
evidence or stipulation construed most strongly in the party's favor.
{¶14} The moving party bears the initial responsibility of informing the trial court
of the basis for the motion, and identifying those portions of the record before the trial
court, which demonstrate the absence of a genuine issue of fact on a material element
of the nonmoving party's claim. Dresher v. Burt, 75 Ohio St.3d 280, 292, 662 N.E.2d
264 (1996). The nonmoving party then has a reciprocal burden of specificity and cannot
rest on the allegations or denials in the pleadings, but must set forth “specific facts” by
the means listed in Civ.R. 56(C) showing that a “triable issue of fact” exists. Mitseff v.
Wheeler, 38 Ohio St.3d 112, 115, 526 N.E.2d 798, 801 (1988).
{¶15} Pursuant to the above rule, a trial court may not enter summary judgment
if it appears a material fact is genuinely disputed. Vahila v. Hall, 77 Ohio St.3d 421, 429,
674 N.E.2d 1164 (1997), citing Dresher v. Burt, 75 Ohio St.3d 280, 662 N.E.2d 264
(1996).
Notice of Default and Acceleration
{¶16} In Albert’s first Assignment of Error, she argues OneWest Bank failed to
establish, as a matter of law, that it complied with the applicable notice requirements
necessary to accelerate the payments due under the Note and Mortgage. We disagree.
{¶17} Albert first argues that OneWest Bank failed to comply with the notice
provisions contained in 24 CFR 201.50(a) and 24 CFR 203.604(b), which require the
lender to contact the borrower in a face-to-face meeting in a specified time frame to
Stark County, Case No. 2013CA00180 6
discuss the default and to seek its cure. Where the mortgage at issue is federally
insured and therefore subject to HUD regulations regarding default or accelerations, the
requirements found in those regulations are conditions precedent to foreclosure. Wells
Fargo Bank v. Gerst, 5th Dist. Delaware No. 13 CAE 05 0042, 2014-Ohio-80, ¶ 23; BAC
Home Loans Servicing, LP v. Taylor, 9th Dist. Summit No. 26423, 2013-Ohio-355, ¶ 14.
{¶18} In the present case, there is no Civ.R. 56 evidence to demonstrate that
Albert’s Mortgage is federally insured. Albert’s Mortgage is a conventional loan and is
not subject to federal housing regulations regarding notice, default, and acceleration.
Albert may not rely upon such regulations as a defense to the foreclosure action where
the regulations have no application to her Mortgage with OneWest Bank. U.S. Bank
Natl. Assn. v. Martz, 11th Dist. Portage No. 2013-P-0028, 2013-Ohio-4555, ¶16 citing
Fifth Third Mtge. Co. v. Orebaugh, 12th Dist. Butler No. CA2012–08–153, 2013–Ohio–
1730, ¶ 33 and Chase Home Fin. LLC v. Middleton, 5th Dist. Fairfield No. 12 CA 10,
2012–Ohio–5547, ¶ 32.
{¶19} Albert next argues there is a genuine issue of material fact as to whether
OneWest Bank satisfied the condition precedents found in the Note and Mortgage
regarding notice of default and acceleration.
{¶20} Paragraph 15 of the Mortgage reads:
Notices. All notices given by Borrower or Lender in connection with this
Security Instrument must be in writing. Any notice to Borrower in
connection with this Security Instrument shall be deemed to have been
given to Borrower when mailed by first class mail or when actually
delivered to Borrower’s notice address if sent by other means. * * * The
Stark County, Case No. 2013CA00180 7
notice address shall be the Property Address unless Borrower has
designated a substitute notice address by notice to Lender. * * *
{¶21} The notice provision of Paragraph 22 of the Mortgage provides:
Acceleration; Remedies. Lender shall give notice to Borrower prior to
acceleration following Borrower’s breach of any covenant or agreement in
this Security Instrument (but not prior to acceleration under Section 18
unless Applicable Law provides otherwise). The notice shall specify: (a)
the default; (b) the action required to cure the default; (c) a date, not less
than 30 days from the date the notice is given to Borrower, by which the
default must be cured; and (d) that failure to cure the default on or before
the date specified in the notice may result in acceleration of the sums
secured by this Security Instrument, foreclosure by judicial proceeding and
sale of the Property. The notice shall further inform Borrower of the right to
reinstate after acceleration and the right to assert in the foreclosure
proceeding the non-existence of a default or any other defense of
Borrower to acceleration and foreclosure.
{¶22} Albert stated in her affidavit submitted with her response to the motion for
summary judgment that she did not receive written notice of default and acceleration
from OneWest Bank. The affidavit of Lisa Marie Gonzalez, assistant secretary of
OneWest Bank, averred that on August 31, 2011, OneWest Bank mailed written notice
of default and acceleration to Albert pursuant to the terms of the Note and Mortgage.
The August 31, 2011 written notice of default and acceleration was attached to
Gonzalez’s affidavit as Exhibit D. The letter shows it was sent by first-class certified
Stark County, Case No. 2013CA00180 8
mail. OneWest Bank did not mail the notice of default and acceleration to the mortgage
property address located on 12th Street, but rather to Albert’s 51st Street address.
OneWest Bank later obtained service of the foreclosure complaint upon Albert at the
same 51st Street address. The letter was mailed on August 31, 2011, more than 30
days before filing the foreclosure action. We find there is no genuine issue of material
fact that OneWest Bank satisfied its duty to provide Albert with notice of default and
acceleration pursuant to the terms of the Note and Mortgage. Further, this Court has
recently held after interpreting a similarly written notice provision that there was no
requirement that the borrower actually receive the notice. Citimortgage, Inc. v. Cathcart,
5th Dist. Stark No. 2013CA00179, 2014-Ohio-620, ¶ 14.
Personal Knowledge
{¶23} Albert contends that Gonzalez’s affidavit failed to satisfy the requirement
of Civ.R. 56(E) that affidavits must be made on personal knowledge with respect to the
attached documents’ admissibility as records of regularly conducted activity pursuant to
Evid.R. 803(6).
{¶24} Evidence Rule 803(6) provides that records of regularly conducted
business activity are admissible, as an exception to the rules of hearsay, if shown to be
such “by the testimony of the custodian or other qualified witness.” The question of who
may lay a foundation for the admissibility of business records as a custodian or other
qualified witness must be answered broadly.
[I]t is not necessary that the witness have firsthand knowledge of the
transaction giving rise to the record. * * * “Rather, it must be demonstrated
that: the witness is sufficiently familiar with the operation of the business
Stark County, Case No. 2013CA00180 9
and with the circumstances of the record's preparation, maintenance and
retrieval, that he can reasonably testify on the basis of this knowledge that
the record is what it purports to be, and that it was made in the ordinary
course of business consistent with the elements of Rule 803(6).”
(Citations omitted.) U.S. Bank Natl. Assn. v. Green Meadow SWS, LLC, 5th Dist.
Delaware No. 21 CAE 09 0069, 2013–Ohio–2002, ¶ 49.
{¶25} In the affidavit, Gonzalez avers that the statements made in the affidavit
are based on her personal knowledge and her personal review of the business records
for the Note and Mortgage which are the subject of the action. She stated that in her
capacity as assistant secretary for OneWest Bank, she has access to the loan
documents and loan account records of OneWest Bank, and the affidavit was based on
her personal knowledge obtained from review of the records and from her personal
knowledge of the operation of the maintenance and retrieval of records in OneWest
Bank’s record keeping systems. She stated that loan account records are compiled and
recorded by OneWest Bank in the course of its regularly conducted business activities,
and it is the regular practice of OneWest Bank to make such records. She further stated
that loan account records are made at or near the time of the occurrence of each act or
event affecting the account by persons with knowledge of said act or event, or from
information transmitted by a person with knowledge of acts or events described within
the loan account records. She also averred that the records are kept, maintained and
relied upon in the ordinary course of business activity. From her position as assistant
secretary of OneWest Bank and her statement that she reviewed the documents in the
instant case, it may be reasonably inferred that she has personal knowledge to qualify
Stark County, Case No. 2013CA00180 10
the documents as an exception to the hearsay rule as a business document. See
Citimortgage, Inc. v. Cathcart, 5th Dist. No. 2013CA00179, 2014-Ohio-620, ¶ 29.
{¶26} Based on the foregoing, the two Assignments of Error of Diana L. Albert
are overruled. The trial court did not err in granting summary judgment in favor of
OneWest Bank on its complaint in foreclosure.
CONCLUSION
{¶27} The judgment of the Stark County Court of Common Pleas, General
Division is affirmed.
By: Delaney, J.,
Gwin, P.J. and
Farmer, J., concur.
| {
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} |
[Cite as Marchese Servs. v. Bradley, 2009-Ohio-2618.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
PUTNAM COUNTY
MARCHESE SERVICES, INC.,
APPELLEE,
v. CASE NO. 12-08-06
AMBER BRADLEY,
APPELLEE,
v. OPINION
DIRECTOR, OHIO DEPARTMENT
OF JOB AND FAMILY SERVICES,
APPELLANT.
Appeal from Putnam County Common Pleas Court
Trial Court No. 08-CV-24
Judgment Affirmed
Date of Decision: June 8, 2009
APPEARANCES:
Eric A. Baum for Appellant
Arthur P. Cohen and Shannon J. George for Appellee,
Marchese Services, Inc.
Case No. 12-08-06
ROGERS, J.
{¶1} Defendant-Appellant, Ohio Department of Job and Family Services
(“ODJFS”), appeals the judgment of the Putnam County Court of Common Pleas
reversing the decision of the Unemployment Compensation Review Commission
(“Review Commission”) and finding that just cause existed for the termination of
Amber Bradley’s employment with Marchese Services. On appeal, ODJFS argues
that the Review Commission’s decision finding that Bradley’s employment
termination was without just cause and granting her unemployment compensation
should be reinstated because the decision is supported by sufficient evidence; that
the trial court should have found Bradley’s employment termination to be without
just cause because her physical limitations were the indirect cause of her
termination, and because her request for employment opportunities that
accommodated her physical limitations was denied; and, that the trial court should
have found that Bradley was constructively, and without just cause, terminated
from her employment because her absenteeism and tardiness were the result of
being forced to commute fifty minutes round-trip while enduring pregnancy and
post-pregnancy complications. Finding that the Review Commission’s decision
was against the manifest weight of the evidence, and that just cause existed for
Bradley’s termination, we affirm the judgment of the trial court.
-2-
Case No. 12-08-06
{¶2} In March, 2007, Bradley filed an application with the Ohio
Department of Job and Family Services, Office of Unemployment Compensation
(“OUC”) for unemployment compensation due to her February 2007 discharge
from her employment with Marchese Services (“Marchese”).
{¶3} Subsequently, the OUC sent a questionnaire to Marchese, asking it
to explain the details of Bradley’s discharge. In response, Marchese stated that
Bradley was discharged for excessive tardiness and absenteeism in violation of the
company’s standard operating procedures which were disclosed to her through the
employee manual; that the reason given by Bradley for her tardiness and absences
were illnesses, doctor’s visits for her and her child, difficulties finding a
babysitter, transportation problems, and having to drive an extended distance to
work; that out of forty-nine instances of tardiness or absenteeism, she only
provided two doctor’s notes; that the company’s disciplinary procedure progresses
as follows: verbal notice, written conference summary, verbal warning,
suspension, written warning with probation, and termination; that, on September
14, 2006, Bradley was given a verbal notice due to the fact that she had taken
extensive time off; that Bradley was given a written conference summary on
November 30, 2006, which detailed her inefficient production numbers and a time
line and goals for future improvements; that she was given a verbal warning on
January 16, 2007, which detailed the company’s policy on tardiness and personal
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Case No. 12-08-06
phone calls during work hours; that she was suspended from January 17 through
January 19, 2007, for continued problems with tardiness, absenteeism, and early
departures; that Bradley was given another warning and placed on probation from
February 19, 2007, until March 2, 2007, for continued absenteeism, tardiness, and
early departures, during which time she was required to abide by all break policies
and not permitted to have any instances of absenteeism, tardiness, or early
departures; and, that, due to her tardiness during the probation period, she was
discharged. Enclosed with its response, Marchese attached several exhibits which
detailed the company’s standard operating procedures and workplace conduct
policy, Bradley’s confirmed receipt of the employee manual and workplace
conduct policy, the company’s disciplinary procedures, and written copies of the
disciplinary actions taken against Bradley. Additionally, Marchese attached a list
of all instances of approved vacations, absenteeism, tardiness, early departures,
and extended breaks. Out of forty-five documented instances of absences,
tardiness, early departures, or extended breaks, excluding pre-approved time off
before hire, maternity leave, and her suspension, forty-one instances were
unexcused and only four were excused for illness or doctor’s visits, of which there
were only two documented doctor’s notes.
{¶4} Additionally, the OUC sent Bradley a questionnaire regarding the
details of her termination, to which she responded that the reason for her tardiness
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Case No. 12-08-06
during the probation period was because she had to take her four-month-old
daughter to the doctor for her scheduled check-up one day and for an allergic
reaction another day; that she furnished a doctor’s note to Marchese for these
instances of tardiness; that she was aware of the company absenteeism and
tardiness policy, but that she was not permitted to take time off for doctor’s visits
under the Family Medical Leave Act (“FMLA”) because the FMLA did not apply
to Marchese; that she had not received warnings or other discipline for instances
of tardiness or absenteeism in the past year; that she did not know if the company
had a grievance procedure, and if so, that they did not offer it to her; and, that the
reason for her tardiness and absenteeism was due to multiple required doctor’s
visits she made during her pregnancy and after her daughter’s birth.
{¶5} On March 26, 2007, the OUC issued a determination of
unemployment compensation benefits, finding that Bradley was entitled to
benefits in the amount of $175 per week because her termination from Marchese
was without just cause, as Marchese failed to follow its established disciplinary
policy when Bradley violated the attendance procedures.
{¶6} In April 2007, Marchese filed an appeal from the OUC’s
determination, arguing that Bradley was discharged for just cause and is, therefore,
ineligible for benefits pursuant to R.C. 4141.29(D)(2)(a), as she was absent or
tardy seventy-four days from July 20, 2006, through February 28, 2007, and she
-5-
Case No. 12-08-06
was discharged after the company followed its disciplinary policy, in which she
was given a verbal notice, a written conference summary, a verbal warning, a
suspension, a written warning and probation, and an additional e-mail warning
reminder. Attached to Marchese’s appeal were written copies of the disciplinary
actions taken against Bradley.
{¶7} On May 11, 2007, the OUC issued a redetermination of
unemployment compensation, finding that Bradley was still eligible for $175 per
week, as a review of the original facts and those submitted in Marchese’s appeal
did not support a change in the initial determination. The redetermination stated,
in pertinent part:
The claimant was discharged by Marchese Services
Incorporated on February 28, 2007. Evidence submitted
establishes that the employer failed to follow the established
disciplinary policy when the claimant violated the attendance
procedures. Ohio’s legal standard that determines if a discharge
is without just cause is whether the claimant’s acts, omissions, or
course of conduct were such that an ordinary person would find
the discharge not justifiable. After a review of the facts, this
agency finds that the claimant was discharged without just cause
under Section 4141.29(D)(2)(a), Ohio Revised Code.
(May 2007 Redetermination, p. 2).
{¶8} Subsequently, Marchese filed an appeal from the OUC’s May 11,
2007 redetermination, again asserting that Bradley’s discharge was for just cause,
as she was absent or tardy for seventy-four days from July 20, 2006, through
February 28, 2007; that the company’s disciplinary procedure was followed prior
-6-
Case No. 12-08-06
to Bradley’s discharge through the use of a verbal notice, a written conference
summary, a verbal warning, a suspension, a written warning with probation, and
an e-mail warning reminder; and, that no evidence was submitted indicating that
the disciplinary procedure was not followed. Marchese again attached written
copies of the disciplinary actions taken against Bradley.
{¶9} Additionally, Bradley’s personal handwritten statement was filed
with the OUC1, which stated that, shortly after she started working at Marchese,
she began having pregnancy complications requiring her to make frequent doctor’s
visits; that, in August 2006, Marchese informed her that she would be required to
start working in the company’s Glandorf, Ohio, office, which was about a twenty-
five minute drive from her home; that, after a month of working in the office, she
asked if she could return to working from home, as she was concerned about going
into labor while driving to and from work; that she was told she would need to
remain working in the office; that, shortly thereafter, she took maternity leave;
that, when she returned to work, she was required to return to working in the
office, but was given the option of working only three days per week instead of the
full five days; that she decided to work the full five days because she needed the
money; that, when she was later placed on two-weeks probation, it became
impossible for her to not miss any days due to her daughter’s doctor’s appointment
1
We note that the record does not indicate whether Bradley or Marchese filed the statement.
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Case No. 12-08-06
and subsequent illness; and, that when she missed days due to her daughter’s
doctor’s appointment and illness, she was dismissed.
{¶10} In June 2007, the OUC transferred Marchese’s appeal to the Review
Commission.
{¶11} In September 2007, Bradley filed a personal statement and several
documents with the Review Commission indicating that she gave birth on
September 14, 2006, while employed at Marchese; that she was discharged from
the hospital on September 16, 2006; that she returned to work the week of
November 4, 2006, approximately two weeks and three days after giving birth;
that returning to work that soon after giving birth did not give her an adequate
opportunity to get settled as a first-time mother and attend the multiple follow-up
doctor’s visits for her and her daughter; that her job was supposed to allow her to
work from home, but that Marchese asked her to work in the office soon after she
returned to work from her maternity leave; that she was given a prescription to
deal with her separation anxiety because she was forced to leave her daughter with
a babysitter when she went to work in the office; that she could not afford her
medication due to a reduction in her hours, as she was told on several occasions to
go home early or take the rest of the week off due to a lack of work; that she was
told by Marchese that they were also cutting other employees’ hours due to a lack
of work, but that she discovered by talking with other employees that she was the
-8-
Case No. 12-08-06
only employee whose hours were reduced; and, that she was discharged when she
missed work to take her daughter to a doctor’s appointment, even though she
provided a doctor’s note.
{¶12} In November 2007, the Review Commission held a hearing on
Marchese’s appeal, at which the following testimony was adduced. Linda
Barbusca, a senior operations manager at Marchese, testified that Bradley was
hired on May 15, 2006, to be a canvass caller for Marchese; that she was
discharged in February 2007 due to excessive absenteeism and tardiness; that
Bradley was originally trained and worked in the Glandorf, Ohio office, but that
she was permitted to work from home for a period of time; that after working from
home for some time, Marchese required her to again work from the office due to
her low performance, her attendance problems, and for retraining; that Bradley
was asked to provide medical documentation if she was not going to be able to
work a set number of hours, and she provided this documentation for all doctor’s
appointments that she had; that, in addition to missing work hours due to doctor’s
appointments, Bradley also missed time because she could not find a babysitter,
because she had car trouble, and because of personal issues at home; that around
half of the occurrences of tardiness, absenteeism, and early departures were due to
doctor’s appointments; and, that, as she continued to have attendance problems,
she was given various warnings and suspensions pursuant to the standard
-9-
Case No. 12-08-06
operating procedures of the company, including a verbal warning on September
14, 2006, a written warning on January 30, 2007, a suspension from January 17
until January 19, 2007, and a two-week probation period starting on February 19,
2007.
{¶13} Bradley testified that the reason for her last tardiness, which led to
her discharge, was that she had to take her daughter to the hospital due to either a
food reaction or the flu; that prior to this tardiness, she had received a warning that
she would be on probation for two weeks and could not miss any days; that her
husband could not take her daughter to the doctor on that occasion because he was
already at work and was the only manager on duty, and that she did not remember
if she asked her mother to take her daughter to the doctor; that she remembered
receiving other verbal warnings prior to being placed on probation; that she
remembered receiving warnings about making personal phone calls while at work
and taking extended breaks; that Barbusca’s statement that she missed work
because of car problems was incorrect, and that she was late on that day because
she had a near-collision with a tractor trailer, subsequently had a panic attack, and
needed someone to pick her up because she could not drive; that most of her
absenteeism was due to either doctor’s appointments or illnesses; and, that she
always provided Marchese with a doctor’s excuse if she missed work time due to a
doctor’s appointment.
-10-
Case No. 12-08-06
{¶14} Subsequently, the Review Commission upheld the OUC’s
redetermination, finding that Bradley was discharged without just cause and
stating the following findings of fact:
Claimant has an extensive history of absenteeism and tardiness.
However, claimant was pregnant and the majority of the
occurrences which led to her discharge were due to her
pregnancy issues, her personal illness, or the illnesses of her
newborn child.
Claimant was given the appropriate warnings as required by
company policy before being discharged.
(Nov. 2007 Decision, pp. 1-2).
{¶15} In December 2007, Marchese filed a request for a reassessment of
the Review Commission’s decision, stating that the reason behind the Review
Commission’s finding that Bradley was discharged was that the majority of her
attendance problems were due to either personal illness, pregnancy, or problems
with her newborn child; however, that of Bradley’s eighty-four instances of early
departures, tardiness, taking extended breaks, and being completely absent, only
thirteen were for doctor’s appointments, of which only one doctor’s note and two
appointment cards were provided. Subsequently, Marchese’s request for a
reassessment was denied.
{¶16} In January 2008, Marchese appealed the Review Commission’s
denial of its reassessment request to the Putnam County Court of Common Pleas,
again, arguing that the Review Commission erred in finding Bradley’s discharge
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Case No. 12-08-06
was without just cause, as she had an extensive history of tardiness, absenteeism,
early departures, and taking extended breaks.
{¶17} In September 2008, the trial court reversed the decision of the
Review Commission, finding that Bradley’s termination was for just cause,
thereby making her ineligible to receive unemployment compensation pursuant to
R.C. 4141.29(D)(2)(a). The trial court stated the following in its judgment entry:
Ms. Bradley worked for employer as a canvas caller. She was
initially permitted to work from home and as of August 2006
was required to work at employer’s Glandorf, Ohio site during
this period. Ms. Bradley had ongoing medical issues including
complications from a pregnancy. Spokesperson Linda Barbusca
reported that Ms. Bradley reported to work late or was absent
on numerous occasions. On February 19, 2007, Ms. Bradley was
placed on a two week probationary period and was required to
have perfect attendance. She subsequently missed one day of
work and was tardy for several others including February 28,
2007, the day on which she was fired. Thirty-eight (38) absences
or tardies are listed in the documented attendance of Amber
Bradley. A doctor’s note was provided on four (4) occasions.
The record reflects that Appellee had a total of eighty four (84)
instances when she left early, came in late, took extended breaks,
or was completely absent. In addition, thirty nine (39) days were
off for maternity leave. Sixty two (62) instances of absenteeism
were with no reason given.
***
The record in this case clearly reflects that Appellee had a
number of absences and for instances [sic] of being to work
tardy. The majority of the absences were not documented * * *.
Furthermore, the Appellee continued to fail to supply
documentation of absenteeism after being placed on a two week
probationary period.
-12-
Case No. 12-08-06
This Court finds that the Review Commissions’ decision was
against the manifest weight of the evidence. The discharge of
Amber Bradley was for just cause and the determination by the
Review Commission was in error.
(Sept. 8 Judgment Entry, pp. 2-5).
{¶18} It is from this judgment that ODJFS appeals2, presenting the
following assignments of error for our review.
Assignment of Error No. I
IT IS UNDISPUTED THAT MS. BRADLEY WAS ENDURING
THE EFFECTS OF A COMPLICATED PREGNANCY
DURING ALL TIMES RELEVANT TO HER
UNEMPLOYMENT-COMPENSATION CLAIM. BECAUSE
THE REVIEW COMMISSION’S FINDING THAT THE
MAJORITY OF MS. BRADLEY’S ABSENCES RESULTED
FROM THIS BONA FIDE ILLNESS IS SUPPORTED BY
SUFFICIENT EVIDENCE, ITS DECISION GRANTING HER
UNEMPLOYMENT-COMPENSATION BENEFITS SHOULD
BE REINSTATED. (BELLEMAR PARTS INDUS., INC. V.
BUTLER (SEPT. 27, 1991), 3RD DIST. NO. 14-90-21, 1991
OHIO APP. LEXIS 4642, FOLLOWED).
Assignment of Error No. II
DUE TO THE RESTRICTED PHYSICAL CAPABILITIES
RESULTING FROM HER PREGNANCY, MS. BRADLEY
ASKED WHETHER SHE COULD REVERT TO WORKING
FROM HER HOME. BECAUSE MARCHESE, WITHOUT
EXPLANATION, DENIED THIS REQUEST FOR AN
EMPLOYMENT OPPORTUNITY THAT CONFORMED TO
HER PHYSICAL CAPABILITIES, HER TERMINATION
WAS WITHOUT JUST CAUSE. (IRVINE V. STATE OF
2
Although Bradley is a party to the case, ODJFS, represented by the Attorney General of Ohio, is the
actual appellant, seeking to have its unemployment compensation determination upheld. Bradley’s interest
in receiving unemployment compensation is, therefore, implicitly represented through ODJFS.
-13-
Case No. 12-08-06
OHIO, UNEMPLOYMENT COMP. BD. OF REV. (1985), 19
OHIO ST.3D 15, SYLLABUS, FOLLOWED.)
Assignment of Error No. III
ALTHOUGH MARCHESE’S REQUIREMENT THAT MS.
BRADLEY WORK FROM THE GLANDORF OFFICE
RESULTED IN CONDITIONS SO INTOLERABLE – SHE
HAD TO COMMUTE 50-MINUTES ROUND TRIP WHILE
ENDURING A COMPLICATED PREGNANCY – THAT A
REASONABLE PERSON WOULD HAVE FELT
COMPELLED TO RESIGN, MS. BRADLEY CONTINUED TO
WORK BECAUSE OF HER FAMILY’S FINANCIAL
SITUATION. BECAUSE HER TERMINATION RESULTED
FROM THIS SITUATION, SHE IN EFFECT WAS
CONSTRUCTIVELY, AND WITHOUT JUST CAUSE,
DISCHARGED. (MAUZY V. KELLY SERVICES, INC., 75
OHIO ST.3D 578, 1996-OHIO-265, PARAGRAPH FOUR OF
THE SYLLABUS, FOLLOWED.)
{¶19} Initially, we note that all three assignments are essentially arguments
of factual issues and fail to properly state specific instances of error. Accordingly,
ODJFS has failed to comply with App.R. 16(A)(3), Loc.R. 7(A) and Loc.R. 11(B),
and, pursuant to App.R. 12(A)(2), we are permitted to disregard any assignments
of error not specifically identified or separately argued. However, in the interests
of justice, we elect to address ODJFS’ assignments of error, and, due to the nature
of ODJFS’ arguments, we will address assignments of error one, two, and three
together.
Assignment of Error Nos. I, II, and III
-14-
Case No. 12-08-06
{¶20} In its first assignment of error, ODJFS argues that its decision
granting Bradley unemployment compensation benefits should be reinstated.
Specifically, it asserts that the trial court’s finding that Bradley’s termination was
for just cause is not entitled to deference, and that the Review Commission’s
decision finding that the majority of Bradley’s absences resulted from a bona fide
illness was supported by sufficient evidence, thereby making her termination
without just cause and entitling her to unemployment compensation.
{¶21} In its second assignment of error, ODJFS argues that Bradley’s
termination was without just cause, and, therefore, that she is eligible for
unemployment compensation because her termination resulted from Marchese’s
refusal to accommodate her physical limitations involved with her pregnancy and
post-pregnancy issues by granting her request for alternate employment
opportunities.
{¶22} In its third assignment of error, ODJFS argues that Bradley is
eligible for unemployment compensation because she was constructively
discharged without just cause. Specifically, it contends that, although Bradley did
not resign, she, in effect, was constructively discharged because she was forced by
Marchese for illegitimate business reasons to commute fifty minutes round-trip to
work while enduring pregnancy and post-pregnancy issues, which caused her to
miss work, thereby leading to her discharge.
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Case No. 12-08-06
Standard of Review
{¶23} An appellate court will not reverse the decision of the Review
Commission as long as it is not unlawful, unreasonable, or against the manifest
weight of the evidence. Geretz v. Ohio Dept. of Job & Family Servs., 114 Ohio
St.3d 89, 91, 2007-Ohio-2941; Benton v. Unemployment Compensation Bd. of
Rev., 3d Dist. No. 6-2000-13, 2001-Ohio-2201, citing Tzangas, Plakas & Mannos
v. Ohio Bur. of Emp. Serv. (1995), 73 Ohio St.3d 694, 1995-Ohio-206, paragraph
one of the syllabus. See, also, R.C. 4141.282(H). A judgment is not against the
manifest weight of the evidence as long as it is supported by some competent,
credible evidence. C. E. Morris Co. v. Foley Const. Co. (1978), 54 Ohio St.2d
279, 280. This same standard of review applies at each appellate level of the
unemployment compensation proceeding, including the court of common pleas,
appeals court, and the Supreme Court of Ohio. Verizon N. v. Ohio Dept. of Job &
Family Servs. 3d Dist. No. 9-06-22, 2007-Ohio-112, ¶18, citing Tzangas, 73 Ohio
St.3d at 696. Accordingly, we are ‘“required to focus on the decision of [the
Review Commission], rather than that of the common pleas court[.]”’ Carter v.
Univ. of Toledo, 6th Dist. No. L-07-260, 2008-Ohio-1958, ¶13, quoting Markovich
v. Emps. Unity, Inc., 9th Dist. No. 21826, 2004-Ohio-4193, ¶10.
{¶24} The determination of factual questions is primarily a matter for the
Review Commission Simon v. Lake Geauga Printing Co. (1982), 69 Ohio St.2d
-16-
Case No. 12-08-06
41, 45, and every reasonable presumption must be made in favor of the Review
Commission’s decision and its findings of fact. Carter, 2008-Ohio-1958, at ¶13.
Furthermore, an appellate court’s jurisdiction is limited to a review of the record
that was created from the administrative proceedings before the Review
Commission. Verizon N., 2007-Ohio-112, at ¶19, citing Bindas v. Admr., Ohio
Bur. of Emp. Servs., 8th Dist. No. 57425, 1990 WL 125456.
“Just Cause” Termination and Unemployment Compensation Eligibility
{¶25} R.C. 4141.29 governs unemployment compensation eligibility and
provides, in part:
(D) Notwithstanding division (A) of this section, no individual
may serve a waiting period or be paid benefits under the
following conditions:
***
(2) For the duration of the individual's unemployment if the
director finds that:
(a) The individual quit work without just cause or has been
discharged for just cause in connection with the individual's
work * * *.
R.C. 4141.29(D)(2)(a).
{¶26} In order to receive unemployment compensation, the employee bears
the burden of proof to establish that the employment termination was without just
cause. Oriana House, Inc. v. Terrell, 9th Dist. No. CA 19550, 2000 WL 277906,
citing Irvine v. State Unemployment Comp. Bd. of Rev. (1985), 19 Ohio St.3d 15,
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Case No. 12-08-06
17; Shephard v. Ohio Dept. of Job & Family Servs., 166 Ohio App.3d 747, 753,
2006-Ohio-2313. Just cause is defined as ‘“that which, to an ordinary intelligent
person, is a justifiable reason for doing or not doing a particular act.”’ Gossard v.
Director, Ohio Dept. of Job & Family Servs., 3d Dist. No. 6-04-06, 2004-Ohio-
5098, ¶9, quoting Peyton v. Sun T.V. (1975), 44 Ohio App.2d 10, 12. The
determination of whether just cause exists for an employee’s dismissal under R.C.
4141.29 is based upon whether there was some fault on the part of the employee
that led to the dismissal. Benton, 2001-Ohio-2201, citing Tzangas, 73 Ohio St.3d
694, at paragraph two of the syllabus. Furthermore, where an employee
demonstrates ‘“unreasonable disregard for [the] employer's best interests,”’ just
cause for the employee’s termination is said to exist. Kiikka v. Ohio Bur. of Emp.
Servs. (1985), 21 Ohio App.3d 168, 169, quoting Stephens v. Bd. of Rev., 8th Dist.
No. 41369, 1980 WL 355009. See, also, Binger v. Whirlpool Corp. (1996), 110
Ohio App.3d 583, 590.
{¶27} Excessive absenteeism and tardiness provide an employer with just
cause to dismiss an employee. Bennett v. Director, Ohio Dept. of Job & Family
Servs., 7th Dist. No. 03-MA-222, 2005-Ohio-3313, ¶28; Higgins v. Patterson
Pools, Inc., 10th Dist. No. 99AP-1394, 2000 WL 1376464. However, a dismissal
for excessive absenteeism and tardiness may be classified as being without just
cause and, therefore, eligible for unemployment compensation under R.C.
-18-
Case No. 12-08-06
4141.29(D)(2)(a) if the absences were the result of a bona fide illness. Durgan v.
Ohio Bur. of Emp. Servs. (1996), 110 Ohio App.3d 545, 550.
{¶28} Furthermore, an employee’s voluntary resignation on the basis of
health problems will be found to be a resignation without just cause, and,
therefore, ineligible for unemployment compensation, unless the employee
demonstrates that a request was made for employment opportunities that
accommodated the employee’s physical capabilities. Eifel v. Ohio Dept. of Job &
Family Servs., 148 Ohio App.3d 167, 171, 2002-Ohio-2672, citing Irvine, 19 Ohio
St.3d 15, at syllabus.
{¶29} In the case sub judice, Marchese filed several documents with both
the OUC and the Review Commission which detailed every step it took in its
discipline of Bradley, including documents evidencing a verbal notice, a written
conference summary, a verbal warning, a suspension, a written warning with
probation, and an e-mail warning reminder. Furthermore, Marchese also filed
documents detailing Bradley’s instances of absenteeism, tardiness, early
departures, or extended breaks, and even though some of those documents differed
in the exact number of days these instances occurred, they each evidenced around
forty-five occurrences, of which only around five were actually excused and
around two where doctor’s notes were provided. Even though the trial court and
Marchese stated several different numbers regarding Bradley’s instances of
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Case No. 12-08-06
absenteeism, tardiness, or early departures, the record is clear that she missed
excessive work time, with very little of that time being excused.
{¶30} Additionally, it is also clear from the record that Bradley submitted
very little evidence to the OUC or to the Review Commission in support of her
claim for unemployment compensation. The administrative record only contains
two doctor’s notes and one document detailing Bradley’s hospital stay when she
gave birth to her daughter. The only other evidence submitted by Bradley were
her personal statements arguing her side of the case. While Bradley asserted to the
OUC and to the Review Commission that most instances of her absenteeism,
tardiness, or early departures were due to doctor’s appointments or having to take
care of her newborn daughter, she provided almost no evidence of these
occurrences, and it is difficult for this Court to lend much credibility to her
argument that she needed to miss work on forty separate occasions in a nine month
span, in addition to her maternity leave, mostly because of illnesses or doctor’s
appointments. Even if we took Barbusca’s statement at the Review Commission’s
hearing that around half of Bradley’s occurrences of missed work time were due to
doctor’s appointments or illnesses, that still leaves over twenty instances of
unexcused absences, tardiness, and early departures, more than enough to
conclude that her discharge was for just cause.
-20-
Case No. 12-08-06
{¶31} Moreover, ODJFS’ reliance upon this Court’s decision in Bellemar
Parts Indus. Inc., v. Butler, 3d Dist No. 14-90-21, 1991 WL 216877, is misplaced.
In that case we found that an employee’s discharge for absenteeism, tardiness, and
early departures on six occasions was without just cause because five of the
occasions were due to the employee’s or her child’s illness. In this case, however,
Bradley had over forty instances of absenteeism, tardiness, or early departures, of
which only about five were documented as being excused. As such, this case is
clearly distinguishable from Bellemar Parts, and we do not find its logic to be
applicable.
{¶32} Accordingly, because of the copious documentation provided by
Marchese detailing Bradley’s excessive unexcused absenteeism and tardiness, and
the progressive discipline administered against her, and because of the dearth of
evidence submitted by Bradley to the OUC and to the Review Commission to
support her argument that her absenteeism and tardiness were due to medical
issues, we find the following: that Bradley failed to meet her burden of proof
establishing that her discharge was without just cause; that her occurrences of
missed work were not the result of a bona fide illness; that she demonstrated
“unreasonable disregard for [Marchese’s] best interests,” Kiikka, supra; and,
consequently, that her termination was for just cause. Although we are required to
make every reasonable presumption in favor of the Review Commission’s
-21-
Case No. 12-08-06
decision and its findings of fact, such presumptions in this case are clearly
unreasonable and against the manifest weight of the evidence.
{¶33} Furthermore, we find to be without merit ODJFS’ argument that
Bradley was constructively discharged without just cause because Marchese failed
to provide suitable employment to accommodate to her physical limitations and
because it forced her to commute fifty minutes roundtrip to work, both causing her
to miss work time due to pregnancy and post-pregnancy issues, thereby leading to
her discharge. First, a constructive discharge analysis requires the employee to
voluntarily terminate employment, see Eifel, 148 Ohio App.3d 167, but here,
Bradley was discharged by Marchese. Second, in analyzing whether Bradley’s
termination was without just cause because Marchese failed to accommodate her
physical limitation and forced her to commute to the office, both subsequently
causing her to miss work time, the administrative record demonstrates that Bradley
only made one request for employment accommodations while she was pregnant,
asking Marchese to allow her to work from home. Bradley did not submit
evidence to the OUC or to the Review Commission showing that she made a
subsequent request after her return from maternity leave, and she even turned
down an offer by Marchese to allow her the option of working three days per week
to better accommodate any post-pregnancy issues. While Bradley argued to the
Review Commission that it was not financially feasible for her to only work three
-22-
Case No. 12-08-06
days per week, she still voluntarily chose to refuse Marchese’s accommodation; as
such, she cannot now complain that her discharge was without just cause because
it resulted from Marchese’s failure to accommodate her physical limitations.
Additionally, Bradley submitted no evidence to the OUC or to the Review
Commission demonstrating the number of absences or instances of tardiness she
could have avoided had she been able to work from home instead of commute to
the office, and, as we previously mentioned, the evidence failed to support a
finding that most of her missed time was due to illnesses or doctor’s appointments.
{¶34} Consequently, because the administrative record demonstrates that
just cause existed for Bradley’s discharge, we find that the trial court did not err in
reversing the decision of the Review Commission granting Bradley unemployment
compensation.
{¶35} Accordingly, we overrule ODJFS’ first, second, and third
assignments of error.
{¶36} Having found no error prejudicial to the appellant herein, in the
particulars assigned and argued, we affirm the judgment of the trial court.
Judgment Affirmed
PRESTON, P.J. and SHAW, J., concur.
/jlr
-23-
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 01-4667
TONY L. GRAHAM,
Defendant-Appellant.
Appeal from the United States District Court
for the Eastern District of Virginia, at Alexandria.
Gerald Bruce Lee, District Judge.
(CR-01-110-A)
Submitted: February 26, 2002
Decided: April 16, 2002
Before LUTTIG, WILLIAMS, and MICHAEL, Circuit Judges.
Affirmed by unpublished per curiam opinion.
COUNSEL
Jeffrey D. Zimmerman, LAW OFFICE OF JEFFREY D. ZIMMER-
MAN, Alexandria, Virginia, for Appellant. Paul J. McNulty, United
States Attorney, Michael E. Rich, Assistant United States Attorney,
William H. Stallings, Special Assistant United States Attorney, Alex-
andria, Virginia, for Appellee.
2 UNITED STATES v. GRAHAM
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
OPINION
PER CURIAM:
Tony L. Graham appeals his conviction, following a jury trial, for
unlawful possession of a firearm in violation of 18 U.S.C.A
§ 922(g)(1) (West 2000), and sentence to sixty-three months incarcer-
ation followed by three years supervised release. Finding no revers-
ible error, we affirm.
Graham first claims the district court erred in denying his Fed. R.
Crim. P. 29 motion for judgment of acquittal. We review a district
court’s denial of a motion for judgment of acquittal de novo, asking
whether there is substantial evidence, taken in the light most favor-
able to the prosecution, to support a jury’s finding of guilt. See United
States v. Romer, 148 F.3d 359, 364 (4th Cir. 1998); United States v.
Burgos, 94 F.3d 849, 862 (4th Cir. 1996). Based on our review of the
joint appendix, we find there is substantial evidence to support the
jury’s conclusion that Graham previously had been convicted of a fel-
ony, that he voluntarily and intentionally possessed a firearm, and that
the firearm had traveled in or affected interstate commerce. 18 U.S.C.
922(g)(1). See also United States v. Gallimore, 247 F.3d 134, 136
(4th cir. 2001) (discussing elements of offense).
Graham next claims the district court erred in denying his motion
for a mistrial based on the Government’s remarks during closing
argument about the veracity of a witness’s testimony. We review the
denial of a motion for mistrial for abuse of discretion. United States
v. Russell, 221 F.3d 615, 618 (4th Cir 2000). The two-prong test for
assessing prosecutorial misconduct requires the court to determine:
(1) whether the prosecutor’s remarks or conduct were improper, and
(2) whether such remarks or conduct prejudicially affected the defen-
dant’s substantial rights so as to deprive him of a fair trial. United
States v. Francisco, 35 F.3d 116, 120 (4th Cir. 1994). Even if the
Government’s statements were improper, we find Graham was not
UNITED STATES v. GRAHAM 3
prejudiced by these remarks. See United States v. Mitchell, 1 F.3d
235, 241 (4th Cir. 1993). We therefore conclude the district court did
not abuse its discretion in denying Graham’s motion for mistrial.
Graham next claims the district court’s use of a cross reference, see
U.S. Sentencing Guidelines Manual § 2K2.1(c)(1)(A) (2000), to sen-
tence Graham under USSG § 2B3.1 for robbery violated the Supreme
Court’s decision in Apprendi v. New Jersey, 530 U.S. 466 (2000).
Apprendi does not prohibit a sentencing court from finding facts relat-
ing to the application of the guidelines, as long as the sentence
imposed is less than the statutory maximum for the offense of convic-
tion. United States v. Lewis, 235 F.3d 215, 219 (4th Cir. 2000), cert.
denied, 122 S. Ct. 39 (2001); United States v. Kinter, 235 F.3d 192,
201 (4th Cir. 2000), cert. denied, 532 U.S. 937 (2001). Because Gra-
ham’s sixty-three month sentence is within the applicable ten year
statutory maximum for the offense of conviction, see 18 U.S.C.A.
§ 924(a)(2) (West 2000), Apprendi is not implicated.
Graham finally claims the district court’s assessment of a five-level
enhancement pursuant to USSG § 2B3.1(b)(2)(C) for brandishing,
displaying, or possessing a firearm in connection with robbery consti-
tuted impermissible double counting. A general cross reference "re-
fers to the entire offense guideline." USSG § 1B1.5(a). Thus, we
conclude the district court’s enhancement of Graham’s sentence under
the guidelines for robbery did not constitute double counting.
Accordingly, we affirm Graham’s conviction and sentence. We dis-
pense 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.
AFFIRMED
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259 S.C. 459 (1972)
192 S.E.2d 720
The STATE, Respondent,
v.
Robert GIBSON, Appellant.
19518
Supreme Court of South Carolina.
November 15, 1972.
John W. Williams, Jr., Esq., of Columbia, for Appellant.
*460 Messrs. Daniel R. McLeod, Atty. Gen., and Emmet H. Clair, Robert M. Ariail, Asst. Attys. Gen., of Columbia, and William R. Hare, Sol., of Chester, for Respondent.
*461 November 15, 1972.
MOSS, Chief Justice:
On or about May 16, 1970, William Robert Yarborough, Jr., and Jerry Eugene Yarborough, nephews of Robert Gibson, the appellant herein, were killed and their mother, Jeanine Yarborough, sister of the appellant, was wounded by several blasts from a shotgun. The appellant was indicted by the grand jury of Chester County for the murder of the two nephews and for an assault and battery with intent to kill on their mother. On October 16, 1970, the appellant entered pleas of guilty to the indictments charging him with the murder of Jerry Eugene Yarborough and the assault and battery charge with intent to kill his sister. The plea of guilty on the murder charge was submitted to the jury for a determination of punishment and a verdict of guilty with recommendation to the mercy of the court was returned. The appellant was sentenced to life imprisonment for the murder of Jerry Eugene Yarborough and twenty years on the charge of assault and battery with intent to kill. There has been no appeal from these judgments and sentences.
*462 The appellant was brought to trial on October 18, 1971, for the murder of his nephew, William Robert Yarborough, Jr. The jury found the appellant guilty of murder and he was sentenced to death by electrocution. This appeal followed.
The appellant does not contend on this appeal that the evidence was insufficient to warrant his conviction of murder but does assert that he is entitled to a reversal of his conviction and a remand of the case for a new trial based upon alleged trial errors.
The conviction of the appellant of murder and a sentence of death pursuant to Section 16-52 of the 1962 Code of Laws took place at the 1971 October term of the Court of General Sessions for Chester County. On June 29, 1972, in the case of Furman v. Georgia, 408 U.S. 238, 92 S.Ct. 2726, 33 L.Ed. (2d) 346, the Supreme Court of the United States held that the imposition and the carrying out of the death penalty constituted cruel and unusual punishment, in violation of the Eighth and Fourteenth Amendments of the Constitution of the United States. The sentence of death in the Furman case was reversed and the case was remanded to the lower court for further proceedings. The Furman case permits us to affirm the judgment of conviction of the appellant of murder and to reverse only the imposition of the death penalty, leaving him subject to sentence under Section 16-52 of the Code, as though the jury had recommended mercy.
We have reviewed the entire record in this case, and conclude that the appellant had a fair and impartial trial and there was no miscarriage of justice. We have considered all questions raised by the appellant and find them to be without merit. The evidence in behalf of the State was unquestionably sufficient to raise a jury question and to justify the trial judge's refusal to set the conviction aside.
As we have heretofore stated, the appellant is under a sentence of life imprisonment for the murder of Jerry Eugene *463 Yarborough and even if the conviction for the murder of William Robert Yarborough, Jr., should be reversed, the appellant's punishment would be in no way affected.
The judgment of conviction of the appellant of the crime of murder is affirmed but the death sentence imposed is reversed and vacated; and this case is remanded to the Court of General Sessions for Chester County for the purpose of sentencing the appellant to life imprisonment under Section 16-52 of the Code, as if the jury had returned a verdict of guilty of murder with a recommendation of mercy.
Affirmed in part and reversed in part.
LEWIS, BUSSEY, BRAILSFORD and LITTLEJOHN, JJ., concur.
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2004 UT 21
Teresa McBride-Williams and Timothy Lee McBride, Plaintiffs and Appellees,
v.
G. Stedman Huard, M.D., IHC Health Services, Inc., dba Dixie Regional Medical Center, and John Does 1 through 10, Defendants and Appellants.
No. 20020751.
Supreme Court of Utah.
FILED March 2, 2004.
This opinion is subject to revision before final publication in the Pacific Reporter.
Matthew T. Graff, Randall C. Allen, Cedar City, for plaintiffs.
David H. Epperson, Stephen Owens, Salt Lake City, for G. Stedman Huard, M.D.
Brinton R. Burbidge, Paul D. VanKomen, Salt Lake City, for IHC Health Services, Inc., dba Dixie Regional Medical Center.
NEHRING, Justice:
¶1 This appeal presents us with the question of whether a medical malpractice claim made by a party who files a complaint which is dismissed for failure to perform certain administrative procedures, commonly known as "prelitigation" procedures, is eligible for the one-year extension of the statute of limitations under the general savings statute of Utah Code section 78-12-40 (2003). We conclude, as did the trial court, that it is.
FACTS AND PROCEDURAL HISTORY
¶2 On October 15, 1998, Mr. Kaarman Elmo McBride died of complications after an abdominal aortic aneurysm. At the time of his death, Mr. McBride was being treated by Dr. G. Stedman Huard at the Dixie Regional Medical Center in St. George, Utah.
¶3 Mr. McBride's children, Teresa McBride-Williams and Timothy Lee McBride, whom for convenience we will call "the McBrides," filed a complaint alleging that the negligence of Dr. Huard and the hospital caused Mr. McBride's death. Because both Dr. Huard and the hospital are health care providers, the McBrides' claims were subject to the Utah Health Care Malpractice Act. Utah Code Ann. §§ 78-14-1 to -17 (2000). The McBrides filed their complaint on September 15, 2000, within the Malpractice Act's two-year statute of limitations. Id. § 78-14-4(1). Dr. Huard and the hospital moved to dismiss the complaint because the McBrides had failed to comply with the litigation procedures set out in the Malpractice Act. Id. § 78-14-12. The trial court granted the motion.
¶4 On May 9, 2001, approximately two years and seven months after Mr. McBride's death, the McBrides filed a notice to commence an action, the first among the prelitigation procedures mandated by the Malpractice Act. Id. § 78-14-2(2)(b). On December 12, 2001, the Division of Occupational and Professional Licensing, the agency responsible for overseeing the prelitigation procedures under the Malpractice Act, issued the McBrides a certificate of compliance with the procedures as required by section 78-14-12(3)(c)(ii). The McBrides then filed a second complaint on January 11, 2002. Dr. Huard and the hospital moved for summary judgment. They based their motion on the contention presented to us here: that the two-year statute of limitations barred the McBrides' claims because their first complaint did not "commence" an action and, therefore, the McBrides' claims became time-barred as of October 15, 2000.
¶5 Determining that the McBrides' first complaint "commenced" an action for the purpose of invoking the one-year savings provision of section 78-12-40, the trial court denied the defendants' motion. We then granted the defendants' petition for interlocutory appeal.
STANDARD OF REVIEW
¶6 This appeal comes to us from a denial of a motion for summary judgment in which no facts are in dispute. We review without deference the trial court's ruling on the legal issue presented. Davis County Solid Waste Mgmt. v. City of Bountiful, 2002 UT 60, ¶ 9, 52 P.3d 1174.
ANALYSIS
¶7 Our analytical task requires that we interpret the word "commence" as used in our statutes and our rules of civil procedure. The general savings provision upon which the trial court relied to salvage the McBrides' claims states:
If any action is commenced within due time and a judgment thereon for the plaintiff is reversed, or if the plaintiff fails in such action or upon a cause of action otherwise than upon the merits, and the time limited either by law or contract for commencing the same shall have expired, the plaintiff . . . may commence a new action within one year after the reversal or failure.
Utah Code Ann. § 78-12-40 (2000).
¶8 The right to file a new action under this section requires both that an action be "commenced" and that it fail for a reason other than its merits. Rule 3(a) of the Utah Rules of Civil Procedure provides clear direction on how an action is commenced, stating that "[a] civil action is commenced (1) by filing a complaint with the court, or (2) by service of a summons together with a copy of the complaint." Had the McBrides' claims not been subject to the prelitigation procedures of the Malpractice Act, the general savings clause certainly would have preserved their second complaint. The McBrides filed their first complaint, and thus "commenced" their action within the two-year statute of limitations; it was dismissed for reasons unrelated to the merits, and the second complaint was filed within one year. The defendants contend, however, that the Malpractice Act incorporates its own action commencement rules which supplant rule 3(a) and place the general savings clause beyond the McBrides' reach. Addressing the general nature and purpose of its prelitigation procedures, the Malpractice Act states that "[t]he proceedings are informal, nonbinding, and are not subject to [the] Administrative Procedures Act, but are compulsory as a condition precedent to commencing litigation." § 78-14-12(1)(c) (2003).
¶9 The defendants insist that this statutory language precludes the McBrides from resorting to the general savings clause because its language is unambiguous, its requirements mandatory, and its subject matter more specific than the provisions of rule 3(a). According to the defendants, when properly interpreted, section 78-14-12(1)(c) renders the McBrides' first complaint a legal nullity and the subsequent running of the two-year statute of limitations presents an absolute bar to their claims. We disagree.
¶10 The requirements set out in rule 3 for the commencement of a civil action act independently from, but in harmony with, various preconditions to suits, including section 78-14-12(1)(c). Rule 3 sets out the manner by which a party may bring a civil matter to the attention of the court. Section 78-14-12(1)(c) does not erect a barrier at the courthouse door, barring entry to medical malpractice claimants who have failed to comply with compulsory prelitigation procedures. Claimants are at liberty to commence an action by filing and serving a complaint under rule 3 irrespective of whether they have heeded the preconditions imposed by the Malpractice Act.
¶11 We adopt this position without endorsing the McBrides' apparent wholesale disregard of the prelitigation procedures mandated by the Malpractice Act. The record indicates that the McBrides were aware of the prelitigation procedures as well as the statute of limitations but chose to proceed pro se and ignore the prelitigation requirements. There is merit to the defendants' assertion that the savings statute offers an undeserved safe harbor for their conduct. However, we believe it unwise either to abandon the savings statute in reaction to isolated egregious conduct or to judicially amend the savings statute to include a test of the worthiness of savings statute candidates. The right to commence an action under rule 3 does not, of course, implicate the merits of the claim or even suggest that the court in which the complaint is filed can exercise jurisdiction over it. Rule 3 "commencement" does, however, create the inalterable fact that a claimant has sought the intercession of the court in aid of obtaining a legal remedy. This fact cannot logically be undone and treated as though it never occurred. Yet, it is just this act of conjuring that the defendants insist is demanded by section 78-14-12(1)(c).
¶12 We have had previous experience in interpreting the relationship between statutory preconditions and the commencement of suits and have uniformly rejected claims that preconditions to suit should displace the effect of rule 3. See, e.g., Madsen v. Borthick, 850 P.2d 442 (Utah 1993) (Madsen III); Madsen v. Borthick, 769 P.2d 245 (Utah 1988) (Madsen II); Madsen v. Borthick, 658 P.2d 627 (Utah 1983) (Madsen I); Foil v. Ballinger, 601 P.2d 144 (Utah 1979). These cases are joined by a common assessment that statutory language creating a "condition precedent" to commencing an action creates a precondition to suit and that a party's failure to satisfy a precondition results in an adjudication for "lack of jurisdiction" pursuant to rule 41(b) of the Utah Rules of Civil Procedure. See Madsen II, 769 P.2d at 249-50; Ballinger, 601 P.2d at 149-50.
¶13 We find unpersuasive the defendants' contention that the language and intent of the Malpractice Act require us to treat differently the precondition language of section 78-14-12(1)(c). The defendants present two arguments in aid of their cause. First, they insist that the plain language of the statute sets apart the Malpractice Act's preconditional mandate from those we have addressed in the past. In particular, they point to the statutory phrase which makes compliance with prelitigation procedures "compulsory as a condition precedent to commencing litigation" as evidence that the Malpractice Act supplants rule 3. If, as the defendants suggest, "compulsory" is intended to modify "condition precedent," it is redundant. "Condition precedent" is defined as "an act or event, other than a lapse of time, that must exist or occur before a duty to perform something promised arises." Black's Law Dictionary 289 (7th ed. 1999). The nondiscretionary nature of a condition precedent is subsumed within its definition, and pairing the term with "compulsory" adds nothing. The use of redundant statutory language would be of concern were it not for the fact that the word "compulsory" has a meaningful purpose when read within the context of the entire text of section 78-14-12(1)(c), which states that "[t]he proceedings are informal, nonbinding, and are not subject to [the] Administrative Procedures Act, but are compulsory as a condition precedent to commencing litigation." When properly integrated into the text, the term "compulsory" serves as a descriptive counterweight to the definition of the proceedings as "informal" and "nonbinding" and does not modify "condition precedent."
¶14 The defendants next assert that because the Malpractice Act incorporates express provisions that toll its two-year statute of limitations to make accommodation for the time expended in complying with the prelitigation procedures, the legislature intended to preempt the savings statute. The legislature has enacted statutes of limitations specific to a wide variety of statutory and common law causes of action. See, e.g., Utah Code Ann. § 25-6-10 (2003) (statute of limitations on fraudulent transfer claims); Id. § 78-15-3 (statute of limitations on products liability claims); Id. § 78-12-48 (statute of limitations on asbestos damages claims). In each instance, the limitations period is the product of a policy assessment that includes consideration of the nature of the claim, the durability of evidence, and the impact of claims on insurance coverage, to name but a few. The savings statute similarly codifies a legislative policy judgment. We can find no inherent conflict between statutes of limitations generally and the savings statute. To the extent that they relate to one another, that tie is complementary. Absent a clear expression of legislative intent that a statute of limitations ought to preempt the savings statute, we will not block access to it. The Malpractice Act provides no clear link between its tolling provisions for prelitigation procedures and an intention to supplant the savings statute. We will not discard rule 3 and cut off access to the savings statute based on this tenuous inference of preemption.
¶15 The defendants supplement their argument that the Malpractice Act is uniquely crafted to overcome the savings statute with an attack on the precedential value of Madsen II. 769 P.2d 245. They point to factual distinctions which they insist disqualify Madsen II from consideration. In Madsen II, we held that the savings statute preserved the opportunity to prosecute claims against state officials in their individual capacities after those claims had been dismissed in an action brought against the defendants in their official capacities because the plaintiffs had failed to file notices of claim as required by the Utah Governmental Immunity Act. Id. at 252-53 (citing Utah Code Ann. 63-30-11, -12 (1979)). While it is true, as the defendants note, that we did not confront the issue of whether the savings clause would have preserved the claims had the second action required Governmental Immunity Act compliance, we stand by our view expressed in Madsen II that "[s]ection 78-12-40 provides that a plaintiff whose action fails on grounds other than its merits may have one year from the date of the failure to file a new action so long as the first action was `commenced within due time.'" Id. at 254 (quoting Utah Code Ann. § 78-12-40). It is clear that Madsen I and Madsen II are premised on the assumption that the Madsen plaintiffs' initial complaint was "commenced within due time," despite containing only claims against the defendants in their official capacities. Had the first complaint not been "commenced within due time," the savings clause would not have rescued the plaintiffs' subsequent complaint, irrespective of whether the Governmental Immunity Act notice was required.
¶16 Finally, the defendants promote as persuasive authority an opinion from the Kansas Supreme Court which refused to extend savings statute relief to claims brought against a municipality outside the statute of limitations. Gessner v. Phillips County Comm'rs, 11 P.3d 1131 (Kan. 2000). We note, however, that the language creating the statutory preconditions to suit at issue in Gessner does not include the term "condition precedent." Id. at 1133. It is also noteworthy that the Gessner court relied on the legislative history of the relevant statute to guide its interpretation. Id. at 1134. We impart no deference to the pronouncements of the Kansas legislature in aid of our interpretation of Utah law. Gessner therefore has no bearing in this case.
¶17 In conclusion, we affirm the decision of the trial court to allow the McBrides' second complaint to go forward under the savings provision of Utah Code section 78-12-40, holding again that the term "condition precedent" does not supersede the commencement of an action under rule 3 of the Utah Rules of Civil Procedure. The McBrides' error in failing to comply with the proper prelitigation procedures does not prevent them from starting anew under the savings provision.
¶18 Associate Chief Justice Durrant, Justice Wilkins, Justice Parrish, and Judge Allphin concur in Justice Nehring's opinion.
¶19 Having disqualified herself, Chief Justice Durham does not participate herein; District Judge Michael G. Allphin sat.
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411 N.E.2d 700 (1980)
Dan SLISZ, Appellant (Defendant below),
v.
MUNZENREIDER CORPORATION AND GREG HUNT, Appellees (Plaintiffs below).
No. 1-879A222.
Court of Appeals of Indiana, Fourth District.
October 29, 1980.
Rehearing Denied November 24, 1980.
*701 Richard S. Harrison, Harrison & Erickson, Bloomington, for appellant.
Joseph D. O'Conner, III, Bunger, Harrell & Robertson, Bloomington, for appellees.
*702 MILLER, Judge.
In the instant appeal defendant-appellant Slisz seeks to set aside the trial court's two-year injunction[1] from operating his Bloomington retail business in violation of a covenant not to compete which he signed in connection with a partnership agreement as the store manager for plaintiff-appellee Munzenreider Corporation. Munzenreider is also engaged in retail furniture sales in Bloomington. In light of the broad language utilized in the instant agreement-which purported in part to prohibit involvement in any city where Munzenreider operated a store, in any business "similar or of a competitive nature to" that carried on by the partnership-combined with the fact it does not appear Slisz possessed any trade secrets, customer lists, or other special or confidential information regarding Munzenreider's operation, we conclude this restrictive language is void, and that the trial court's injunction must accordingly be reversed.
We first consider the factual background of the case at bar, since it is evident the authorities involving covenants not to compete frequently turn on subtle, but significant, evidentiary distinctions which must be garnered by examining the facts and circumstances surrounding each case. Captain & Co., Inc. v. Towne, (1980) Ind. App., 404 N.E.2d 1159, 1161, citing Frederick v. Professional Building Maintenance Industries, Inc., (1976) 168 Ind. App. 647, 344 N.E.2d 299.
The evidence reveals Slisz first became involved with Munzenreider Corp. as a part-time employee during the period when he worked as a high school teacher in Muncie. Slisz had previously graduated from Ball State University with a B.S. in physical education. Slisz testified he ultimately was forced to choose between the jobs, and at that time elected to work full-time with Munzenreider at its Muncie store, apparently under the supervision of one Hunt, manager of that store and vice-president of the national organization. Hunt testified Slisz worked approximately eight to nine months in Muncie, during which time Hunt trained him, in a manner facilitated by the corporation's national training program,[2] in how to run a retail furniture store, including instruction in "advertising, how to merchandise, different sales techniques, different suppliers that we do business with, how to set up financial contracts for the retail customers, how to do bookkeeping, take inventory, etc." Slisz did not have previous full-time experience in the furniture selling business.
Thereafter, Slisz was made a managing partner at the corporation's furniture store in Eagledale Shopping Plaza in Indianapolis, a position he held for only two months before being transferred to the store in Bloomington, then known as United Freight Sales (now called United Furniture Sales), which is central to the instant appeal. Slisz testified he acted as an assistant manager at United Freight Sales for one and one half months, and was then made manager, a position he held for approximately five years until December 1978. The pleadings and evidence further disclose that on or about March 10, 1975 Slisz signed an agreement with Munzenreider providing that, as "managing partner" of United Freight Sales, Slisz would receive 100% of the first $7,800 in annual net profits of the store plus an additional percentage-beginning at 10% the second year, and increasing 10% each thereafter up to 50%-in return for management duties performed by Slisz. The agreement provided Slisz could terminate the relationship upon one month's notice, and that Munzenreider Corp. could also terminate his employment for various causes specified. It was further provided:
"11. The managing partner agrees that he will not at any time, directly or indirectly, divulge to any person, firm or corporation, or use himself, any information *703 he has gained or that he may hereafter acquire during the term of the partnership relating to or regarding the nature of the partnership business, method of operation, its advertising techniques, its past, present or potential customers and any other matter of confidential or secret nature, and that he will at all times hold inviolate the knowledge of the operation of this partnership.
12. The managing partner agrees that in the event of the termination of the partnership for any reason whatsoever, he will not for a period of two (2) years from the date of such termination, then engage in or accept employment from or become affiliated with or connected with, directly or indirectly or become interested in, directly or indirectly, in any way in any business within the counties of Monroe, Brown, Morgan, Owen, Greene and Lawrence, IN, similar or of a competitive nature to the business carried on by the partnership, or any other city or place wherein the partners operate a store or within thirty (30) miles of said city where a store is maintained by the capital partners. The managing partner further agrees that he will not solicit from or approach in any manner for his own use or for the benefit of any future employer, the customers or suppliers of the present partnership."[3] [Emphasis Added.]
Slisz stated that while he was employed as manager at United Freight Sales, his duties included sales as well as book work, advertising, and other management tasks, and that he supervised two other employees. He indicated he did not have occasion to professionally travel to counties outside of Monroe County, although he did advertise a few times in Owen County, and regularly advertised in the Bloomington Sunday newspaper, which the evidence reveals is circulated in Bedford, located in Lawrence County.[4] The evidence further established that after the first several months of 1978, the store was moved to a new location, and that, according to the witness called by Munzenreider, the store has continuously lost money from the time of that move until trial. In December of 1978, Slisz was informed he would be replaced as manager at the Bloomington store, and was offered a job with the Corporation in South Dakota. This he declined, after which Slisz left his employment with Munzenreider and opened his own retail furniture business, at the same location previously occupied by United Freight Sales, on February 1, 1979. His business is called Warehouse Furniture Sales.
The instant litigation was commenced when Munzenreider Corporation and Hunt filed their complaint against Slisz requesting reasonable damages and that Slisz be enjoined from operating his own furniture business or working in another in violation of the agreement, because, it was alleged:
"9... . [D]efendants is using schedules of prices, advertising materials, and other materials and knowledge that he gained from his relationship with the plaintiff pursuant to the partnership agreement in a way that is presently undercutting the plaintiff's business in Bloomington and surrounding areas.
10. That the defendant's pursuit of this business is in direct contravention of the reasonable provisions of the Partnership Agreement stated in Paragraph 11, 12 and 13.[5]
11. Because of [sic] the business of Warehouse Furniture Sales is of the identical kind as a business of the plaintiff, plaintiff has been damaged by this breach *704 of the partnership agreement and will continue to be damaged because of the competitive nature of the two businesses."
Following a trial at which Slisz himself testified, along with Hunt and one Honchar, current manager of the Munzenreider's Bloomington store, the trial court determined in its "Discussion of the Law" it was reasonable for Munzenreider to contract against Slisz's acts, which it described as follows:
"Plaintiff had a particular method of doing business: volume purchasing of low end furniture, competitive pricing, and newspaper advertising. The Defendant utilized his method in his own business. Additionally, the Defendant used an advertising format duplicative of the Plaintiff's and the Defendant operated his business at the exact location where the Plaintiff had developed a low end furniture sales market. These acts of direct competition are the very acts that the plaintiff sought to avoid through the covenant not to compete."
Accordingly, the court ordered Slisz enjoined "from operating a furniture business in violation of the no-competition clause," although its Discussion of Law also purported not to reach the question of the outer geographical limits of the covenant, since, "at a minimum, a restriction on competition in the Bloomington area is reasonable."
Consideration of Slisz's subsequent appeal must begin from the general proposition that restraints on competition between an employer and his former employee, similar to that in this case involving a "managing partner," are not favored by the law, but will nevertheless be enforced where 1) the restraint is reasonably necessary to protect the employer's business; 2) it is not unreasonably restrictive of the employee, and 3) the covenant is not antagonistic to the general public interest. Waterfield Mortgage Co. Inc. v. O'Connor, (1977) Ind. App., 361 N.E.2d 924. 54 Am.Jur.2d Monopolies, Restraints of Trade and Unfair Trade Practices, § 543 at 982 (1971).
In applying such test, many courts have held an employer must demonstrate some "special facts" giving his former employee a unique competitive advantage or ability to harm the employer before such employer is entitled to the protection of a noncompetition covenant, and those "special facts" may include (but are not limited to) such things as trade secrets known by the employee, the employee's "unique" services, confidential information (such as customer lists) known to him, or the existence of a confidential relationship. Annot., "Enforceability of Restrictive Covenant, Ancillary to Employment Contract, as Affected by Duration of Restriction," 41 A.L.R.2d § 13 at 69; 17 C.J.S. Contracts § 254 (1963). At the same time, the rule is generally stated that "[t]he mere fact that an employee has acquired skill and efficiency in the performance of the work as a result of his employment does not suffice to warrant the enforcement of a covenant on his part not to compete." 17 C.J.S. Contracts § 254 at 1141 (1963).
The same essential approach has been adopted by our Supreme Court in the leading case of Donahue v. Permacel Tape Corp., (1955) 234 Ind. 398, 127 N.E.2d 235, where it was held an employee signing a restrictive covenant not to compete is entitled to utilize the general skills he has acquired in performing his job, and can only be prevented from doing so under circumstances where their use adverse to his employer would result in irreparable injury. As the Court stated:
"As an incident to his business, the appellee (employer) was entitled to contract with regard to and thus to protect the good will of his business. Elements of this good will included `secret or confidential information,' such as the names and addresses and requirements of customers and the advantage acquired through representative contact with the trade in the area of their application. These are property rights which the employer is entitled to protect. However, the same is not true regarding the skill and [sic] employee has acquired, or the general knowledge or information he has obtained which is not directly related to *705 the good will or value of employer's business... . An employee may contract to conditionally forego these personal attainments as a consideration for his employment only where their use adverse to his employer would result in irreparable injury to the employer."
234 Ind. at 410-11, 127 N.E.2d at 240. In that case, the Court ultimately found a covenant unenforceable because it would have prevented a tape sales representative from engaging in such profession throughout the United States and Canada, when his previous employment with the complaining employer (the nature of which was not precisely described) was limited to northern Indiana. The Court reasoned the "ordinary general" information to which he was privy, which did not include trade secrets but did involve lists of customers and their requirements, necessitated that "irreparable injury" could occur only in the area of his previous employment. Refusing to so limit by judicial construction the broad terms of the particular covenant at issue in that case, the Court in Donahue held the trial court's temporary restraining order must be dissolved.
As is suggested by the reasoning of Donahue, the cases in this area of the law weigh the employer's "protectable interest" in conjunction with other factors, including the geographical and time restraints of the particular covenant involved, to determine whether the covenant is reasonable and not in conflict with the public interest. Frederick v. Professional Building Maintenance Industries, Inc., supra. It is evident where the underlying protectible interest appears minimal, courts are apt to closely scrutinize the terms of the restraint. See, e.g., Captain & Co., Inc. v. Towne, supra, where the Court concluded, after observing that the former employee of an insurance clean-up and reconstruction business had obtained little more than general information, that the two-year restraint was "unreasonable in view of the nature of the protectible interest." Id. at 404 N.E.2d at 1162. The Court noted the evidence did not show the former employee in that case had "stolen" any customers, nor were there any customer lists, since the nature of the business required firms to wait for customers to contact them, and that "[a]ny advantages, acquired through prior contact with insurance adjusters, were minimal because of the nature of the insurance claim business." Id. The trial court's denial of a preliminary injunction was correspondingly affirmed.
Similarly, the Court in Frederick v. Professional Building Maintenance Industries, Inc., supra, found significant the fact that the management trainee in a contract cleaning and maintenance business did not possess any novel or unique information amounting to a trade secret, although it was further observed he did learn "bidding and cost analysis information" which might be utilized in an effort to undercut bids to the employer's customers, and that the employee's job gave him "the advantage of personal acquaintance with the representatives of ... [his employer's] customers in the area where he worked." Id. 168 Ind. App. at 649, 344 N.E.2d at 301. Utilizing the reasoning in Donahue, the Court in Frederick determined, however, that the particular covenant applied against the management trainee, which covered eight counties, was overly broad, since there was no evidence he had worked for his employer in its contract maintenance business in each of those eight counties. Thus, the employer had failed to meet "the burden of proving the facts and circumstances that may justify relief," an evidentiary showing which in these cases necessarily "rests with the party seeking to enforce the covenant." Id. at 648; 344 N.E.2d at 301. Although it was additionally argued that the covenant should in any event be read narrowly, the opinion in Frederick observed that "the courts may not enforce a reasonable restriction under the guise of interpretation,"[6]id. at 648-49; 344 N.E.2d at 301, although it reiterated the general rule that "the ultimate *706 determination of whether the covenant is reasonable is a question of law for the courts." Id. at 648; 344 N.E.2d at 301.
Returning to the facts of the instant case, there was undisputed testimony that Slisz in the operation of his new store, sold the "same type of merchandise" dealt with by the Munzenreider store, namely, "low end" (low price) retail furniture, although Slisz also stated he does not deal (with one exception) with the exact same brand name goods. Further, there was evidence from Hunt that Slisz employed the same type of advertisements-including an allegedly "unique" system of classified advertising[7] -used at the Munzenreider store, and that Slisz was thereby utilizing the training he had earlier received from Munzenreider. When asked what Slisz may have learned which he would not have learned at any other furniture store in the community, Hunt further replied "[i]t's probably our volume purchasing and our lower prices," though he admitted "I'm assuming that that's relatively easy to figure out." Hunt also indicated Slisz was an unusually harmful competitor, thus generating a "protectible interest" in favor of Munzenreider:
"Because he knows the products that we sell, where we get them or the type, you know, manufactures that make that and he learned that stuff from working for Munzenreider, for going, from buying from different representatives that came around."
Hoschar, the current manager of the Munzenreider store in Bloomington, known as United Furniture Sales, stated there had been some "confusion" among his customers concerning the two different stores (the Munzenreider store and the one operated by Slisz) because "he was in that operation at that location exactly where he's at right now," and that people responding to Munzenreider newspaper ads may go to Slisz's store because they only "will catch a glimpse of where it is on sale." He admitted, however, that he supposed the same problem could arise if any retail furniture dealer took over the old location. Munzenreider also submitted two exhibits, showing that what appears to be the same drawing for a dinette set appearing in ads from the competing stores, with an advertised price of $179.99 in each case.[8] Hoschar further stated that each of the several items appearing in the ad run by Slisz were also items carried in the Munzenreider store. The evidence does not reveal whether the ads appeared at the same time, although Hoschar testified that in one Sunday newspaper, Slisz ran a one-half page ad undercutting by $30-$40 the prices in the Munzenreider ad on the reverse side of the "classified" ad page. Also introduced, as defendant's exhibits 1 and 2, were newspaper ads from a third Bloomington competitor (Colonial Furniture)[9] with respect to which Hoschar testified as follows:
"Q ... Can you then distinguish for me if you would please how those advertisements are different from your own?
A Well you, you can't vary an advertisement to a source. It's got the basic ingredients in every ad.
.....
Q ... How is it going to be different?
A Any, ... certain unique little object that you can place in an ad to draw attention to people to look at the ad is going to be an advantage to you. Anybody, you know, you could change the name on this and I couldn't tell you who it was from if you wanted to do that... .".
*707 There was no evidence that Slisz intentionally solicited customers away from the Munzenreider store, and he testified he did not engage in such solicitation. Slisz further stated that the manufacturer's representatives who had called on him as manager of the Munzenreider store continued to call on him at his own business, but that he bought only one specific brand which was the same, comprising at most 10% of his inventory.
In response to Munzenreider's argument that such evidence satisfies its burden of showing a protectible interest requiring the reasonable restraints of a covenant not to compete, we first look to the language of the covenant itself, since it is only by looking at the "interrelation" of the "proscribed activity" in connection with the particular time constraint and the nature of the "protectible interest" that a court on appeal may decide the outcome in a given case. Frederick v. Professional Building Maintenance Industries, Inc., supra.
Although the terms of the covenant are somewhat ambiguous, it appears that the language of paragraph 12 of the parties' agreement on its face prohibits Slisz from becoming involved not only with any business in any city which is of a "competitive nature" with a local Munzenreider store, but in addition prohibits him from becoming connected with any "similar" operation, apparently without regard to whether such similar business actually competes with Munzenreider or is even of a "competitive nature." The agreement does not purport to define what kind of business may be "similar" to the partnership operation. We note, however, in this context that the general definition of that word includes broad concepts such as "having characteristics in common," WEBSTER'S THIRD NEW INTERNATIONAL DICTIONARY 2020 (1976). Thus an employee such as Slisz may be forced to speculate whether such language prohibits, for example, the operation of a retail outlet for expensive, "high end" furniture even though the new store does not compete with a "low end" Munzenreider operation.[10] Moreover, as noted above, the terms of such covenant prohibiting connection with "similar" businesses encompass not only the City of Bloomington and Monroe County and various counties adjoining it, but indeed every city (and a 30-mile radius around it) in which Munzenreider operates a store, apparently without regard to whether such city is in Monroe County, the State of Indiana, or even the entire United States. It seems evident, as our courts have held, that so geographically broad a covenant may be reasonable only in very unusual circumstances, such as where "trade secrets" are involved. See Donahue v. Permacel Tape Corp., supra, in which a covenant extending throughout the United States and Canada was held to be too broad in the absence of trade secrets or similar information. Where such a covenant prohibits, in addition, a connection with any business which is similar or competitive, we believe the agreement may be void on its face.
While we might thus conclude, as is acknowledged by the Court in Frederick v. Professional Building Maintenance Industries, Inc., supra, that "the breadth of a single restriction may appear to dominate the outcome," id. at 650; 344 N.E.2d at 302, we nevertheless proceed to consider, as in that case, the nature of the particular "protectible interest" shown, in part because Munzenreider has alleged in its complaint that Slisz has utilized confidential or secret "materials and knowledge" in violation of paragraph 11, supra, as well as paragraph *708 12, of the parties' agreement.[11] Such allegations, if proved, may arguably demonstrate the existence of a trade secret or similar confidential information permitting a somewhat broader restriction than may otherwise be allowed. Donahue v. Permacel Tape Corp., supra.
It appears, however, that in the instant case there was no evidence to support the allegations by Munzenreider that Slisz utilized, or even had access to, any confidential or secret information, or that the particular employment of Slisz otherwise created a "protectible interest" in Munzenreider so as to reasonably warrant the covenant in question, or any covenant not to compete.
In this context, Munzenreider cites Welcome Wagon, Inc. v. Haschert, (1955) 125 Ind. App. 503, 127 N.E.2d 103, which held there was a protectible interest in the employer (Welcome Wagon) where its hostess, a woman of high reputation with a "personal following" and "extensive acquaintance" in her community, learned the novel and unique business methods of Welcome Wagon and then quit to establish her own similar operation in the same city (Kokomo), using some of the same "sponsors." The special business methods included a national training program in New York to which the employee was sent, where she was instructed in Welcome Wagon's method of calling on brides, newlyweds and newcomers to the community and presenting them with certificates from the Mayor and the Chamber of Commerce and other organizations, along with gift certificates from sponsoring businesses. The sponsors in return paid a commission. The Court held enforceable a covenant prohibiting her from engaging in such operations on her own in the city of Kokomo,[12] stating as follows:
"The fact that the injury done by the breach of a restrictive covenant in a contract of employment cannot be measured in dollars and cents and compensated though an action at law, is a prime reason for enjoining its continuing breach. In our opinion irreparable injury need not be shown where, as here, the services of the employee have been of such character that she gained knowledge of her employer's special and particular business methods and the very purpose of the breach is to capitalize upon the use of such methods for her own benefit.
.....
We see nothing unreasonable in contracting against the appellee's engaging in a business the same or similar to that of the appellant for a period of five years within the corporate limits of the city of Kokomo where her personal acquaintance and following is substantial. (Emphasis Added.)"
Id. at 507, 127 N.E.2d at 106. The Court accordingly reversed the trial court's denial of an injunction on the grounds such denial was contrary to law.
In contrast to the facts in Welcome Wagon, in the leading case of Club Aluminum Co. v. Young, (1928) 263 Mass. 223, 160 N.E. 804, the Massachusetts Court found a covenant unenforceable where it prevented salesmen of aluminum ware from working for a competitor after being instructed in the business methods originated by the plaintiff, since in that case the allegedly "unique" methods were held not to create a *709 protectible interest. Such methods, involving "specialized" training of the salesmen, consisted of inducing a housewife to gather her friends together for a cooking demonstration, after which the salesmen individually called on each of the assembled homemakers. But the Court, in noting such practices were "openly employed by the plaintiff and at least three of its competitors," and after observing that there was only a general averment of "specialized" training and that the employee in question was made privy to no special secrets, concluded in essence that the employees had gained no unfair competitive advantage against their former employer requiring a restrictive covenant, and that "[i]t is difficult to conceive of any ordinary employment which could not be cleverly clothed in broad language as special and peculiar as that employed in the contract here in issue." Id. at 228; 160 N.E. at 806. See also Reed, Roberts Associates, Inc. v. Strauman, (1976) 40 N.Y.2d 303, 386 N.Y.S.2d 677, 353 N.E.2d 590, where the Court held an auditor employed by a tax advising firm possessed no unique skills nor any confidential information, where the names and addresses of potential customers are readily available through public sources.
We believe that in light of the evidence presented, the situation in the instant case more closely resembles that in Club Aluminum, in contrast to the unusual facts of the Welcome Wagon case, since the evidence in the case at bar does not suggest Slisz possessed a particular following or unique skills such as were involved in Welcome Wagon, nor had he received information regarding trade secrets, customer lists or other confidential matters. Thus, while it was alleged Slisz received specialized training, including instruction in "unique" methods of classified advertising, such assertions were unsupported by specific evidence in the record, even assuming arguendo that such practices as advertising in the classified section of the newspaper would not be (as Hunt admitted in the case of Munzenreider's alleged volume purchasing and lower prices) "relatively easy to figure out." Like the Court in Club Aluminum, which sustained the defendants' demurrer to the plaintiff employer's cause of action, we believe unsubstantiated claims of "`[h]ighly specialized training and personal supervision in connection with the sales of ordinary merchandise well known in the market, alleged to have been given by the plaintiff to all its salesmen, are statements too general in nature to constitute ground for legal relief." Club Aluminum Co. v. Young, supra, 263 Mass. at 227, 160 N.E. at 806. Otherwise, there would remain nothing but a "shadow" of "the general rule against the validity of restrictive covenants upon individual liberty of action as to one's trade or calling... ." Id. at 228, 160 N.E. at 806. Nor do we believe the mere fact that Slisz knows the products sold by Munzenreider and their suppliers creates any protectible interest in Munzenreider, in light of the essentially uncontroverted evidence that such products were generally available to any furniture retailer by virtue of suppliers' representatives who call on the retailers.[13]See generally Reed, Roberts Associates, Inc. v. Strauman, supra. We note in this context that although Hunt testified Slisz was advertising "every basic product that we have at a lower price," Slisz further stated he sold only one of the particular brand names sold by Munzenreider, and that such products comprised at most 10% of his inventory. There was no evidence clarifying Munzenreider's allegation in its complaint that Slisz is using a "schedule of prices" gained from his employment relationship.
The circumstances of the instant case may similarly be seen as outside the language in Donahue v. Permacel Tape Corp., supra, in which it is suggested there may be an irreparable injury to "good will" deserving *710 protection in the geographical area serviced by a sales representative. The Court in that case noted that such sales representative was made aware of customer lists and requirements, knowledge which the Court elsewhere in the opinion described, as noted earlier in this opinion, as "secret or confidential information" constituting "property rights which the employer is entitled to protect." Id. 234 Ind. at 410-11; 127 N.E.2d at 240. It does not appear any similar evidence involving possible harm to "good will" was presented in the instant case. Indeed, although Hoschar testified he believed Slisz may benefit from "confused customers" responding to Munzenreider ads by going to Slisz's store at the former Munzenreider location, he also acknowledged, as noted above, such problem could arise "if anybody was at that store." There was no showing that Slisz was actively soliciting Munzenreider customers by, for example, advertising his former association with that corporation's business. Compare the facts of Samuel Stores, Inc. v. Abrams, (1919) 94 Conn. 248, 108 A. 541, where the Court, in observing that a clothing store manager could reasonably be prohibited from soliciting the trade of a branch store where he worked, could not be enjoined from opening his own store in the same city under a covenant purporting to extend to any city in which the employer had a clothing business.
It follows from this discussion that Munzenreider failed to present any evidence of "secret" or "confidential" information utilized by Slisz in violation of paragraph 11 of the parties' partnership agreement, nor was there a showing of any interest involving "good will" or other protectible matter warranting the protections of paragraph 12 of that agreement, which purports to prohibit Slisz from becoming associated with any "similar" operation in a broad geographical area. In short, it appears the agreement in question "relates merely to services in a local retail business, and primarily aims to restrict competition," Samuel Stores, Inc. v. Abrams, supra at 254, 108 A. at 543, by preventing Slisz from using the general skills he has acquired during his employment in the subsequent operation of any "similar" business in a broad geographical area. Under the circumstances of this case, we hold such a covenant to be unreasonable and thus unenforceable.[14] Indeed, even assuming (as the trial court apparently did) arguendo that the geographical restraint of the covenant in question could be narrowed through judicial construction in disregard of the principle expressed in Frederick v. Professional Building Maintenance Industries, Inc., supra, it nevertheless appears such a covenant would unduly restrict the rights of a former employee where there has been no showing of confidential information, customer lists, or even the advantage of close customer contact with a "pool" of Munzenreider patrons such as that involved in the salesmen route cases and suggested by the opinion in Donahue v. Permacel Tape Corp., supra. Absent an appropriate factual showing-not made in the instant case-supporting the allegations of a protectible interest in the employer, such a covenant is void as against public policy.
Munzenreider contends, in response to such conclusion, that this Court on appeal cannot disturb the trial court's determination, in its "Discussion of the Law," that Munzenreider utilized a "particular method of doing business" entitling it to the protections of the covenant not to compete. We agree that an appellate court is not empowered to "reweigh" the evidence properly heard in the trial court. We also observe, however, that it is the function of a reviewing court in these cases to determine whether, in light of the evidence which was *711 presented, a covenant is reasonable and thus enforceable as a matter of law, a question which necessarily involves consideration of the showing of allegedly legitimate interests (if any) of the covenantee which might be protected. Raymundo v. Hammond Clinic Association, (1980) Ind. App., 405 N.E.2d 65, 68, citing Frederick v. Professional Building Maintenance Industries, Inc., supra; and Waterfield Mortgage Co., Inc. v. O'Connor, supra, where the Court stated "[r]easonableness of the covenant being a question of law, its resolution must invariably rest on adequate facts." Id., 361 N.E.2d at 926.
Munzenreider also presents the final, additional argument that Slisz is "estopped" from challenging the validity of the covenant not to compete because he has accepted various benefits flowing from the parties' partnership agreement containing such covenant. We observe, in response to such argument, that our Supreme Court has stated in Donahue v. Permacel Tape Corp., supra, that "[a]n employee may contract to conditionally forego ... personal attainments as a consideration for his employment only where their use adverse to his employer would result in irreparable injury to the employer," id. 234 Ind. at 411, 127 N.E.2d at 240 (emphasis in original),[15] a conclusion which we take to mean there is a general public interest supporting an employee's use of his acquired skills in cases such as the one at bar. Moreover, in light of the various services rendered to Munzenreider by Slisz as a managing partner, we cannot assume in contrast to the claim of Munzenreider, that "the language of paragraph 13 [of the partnership agreement] demonstrates that the major consideration flowing to the appellee [Munzenreider] from the appellant [Slisz] is the restrictive covenant, ... ." That paragraph provides:
"13. The partners hereto recognizing that irreparable injury will result to the capital partner, its business and property in the event of a breach of this agreement, particularly in regards to paragraphs 11 and 12 [quoted supra], and this partnership is based primarily upon this agreement, it is therefore agreed in the event of a breach a capital partner shall be entitled, in addition to any other remedies available, to an injunction to restrain the violation thereof by the managing partner, his agents, servants, employers and employees and all persons acting for or with him."
Despite such language, we cannot conclude that any of Slisz's acts in accepting the benefits of a managing partner should estop him from attacking the injunction sought in the instant case. As noted in Donahue, supra, "the rule is firmly established, with reason, that in determining the validity of a negative covenant in restraint of competition that such contracts are to be strictly construed against the covenantee, and the test of their validity is dependent not merely upon the covenant itself but upon the entire contract and the situation to which it is related." Id. at 404, 127 N.E. at 237.
Accordingly, we reverse.
YOUNG, P.J., and CHIPMAN, J., concur.
NOTES
[1] Execution of the Monroe Superior Court's order, which by its terms extends for two years until December 31, 1980, was stayed pending this appeal.
[2] Though the testimony in unclear, it does not appear Slisz himself was directly trained in any such national program by Munzenreider.
[3] Additionally, paragraph 15 provides for agreed damages for $1,000 per week for violation of certain prohibitions in the agreement, including paragraph 11.
[4] In this context it is also significant to note Hunt testified the store generally serviced the area "within Bloomington and probably a thirty mile radius depending on where he's advertising," and that Slisz should have advertised and have had repair and service contacts with customers in that area (emphasis added). The evidence did not reveal whether such thirty mile radius would include the entirety of the named counties.
[5] Paragraph 13, quoted infra, provides for damages and injunctive relief owing to irreparable damage caused by a breach of the agreement.
[6] It was also suggested in Frederick that the various cases purporting to sever covenants not to compete so as to make them reasonable should be "restricted to the facts there appearing." Id. at 649 n. 1; 344 N.E.2d at 301 n. 1.
[7] The evidence did not reveal the exact nature of such advertising-for example, it was not indicated precisely where in the classified advertising sections such ads were placed-nor did the evidence disclose that Slisz's ads were identical in content to those used by Munzenreider.
[8] Exhibit "A" also includes what are apparently three classified ads used by Slisz at his new store. There do not appear to be corresponding ads from the Munzenreider operation.
[9] We note such ads showed a photograph of a dinette set (which, like that advertised by Slisz and Munzenreider, was available with one leaf and four chairs) selling for either $297.50 or $197.50, depending on how many chairs and leaves were purchased.
[10] With regard to interpreting this use of the word "similar," we observe Munzenreider did not present evidence revealing precisely what kinds of furniture it sold at its Bloomington store, although we are aware from the exhibits such furniture included dinette sets, living room sets, rockers and mattresses. Arguably at least, the reference to "similar" businesses would include any department store (including discount stores) with a furniture department, as well as business and specialty furniture stores, and perhaps any establishment selling appliances such as televisions, or even other "low end" discount businesses which do not sell furniture.
[11] As earlier observed herein, Munzenreider alleged Slisz "is using schedules of prices, advertising materials, and other materials and knowledge that he gained from his relationship with the plaintiff ..." in violation of the various covenants against competition. The trial court held he was enjoined from operating his business in violation of "the no-competition clause of the parties' agreement," and that he is further enjoined from divulging "any information he has gained from his employment from the Plaintiff regarding the nature of the business, mode of operation, advertising techniques, past and potential customers or any other matter secret or confidential nature of the Plaintiff."
[12] Although the covenant by its terms included the entire United States, the provision involving such broad geographical scope was found to be severable from language restricting the covenant to Kokomo, in light of numerals and the words "and/or" used to separate the terms of the covenant. Compare Frederick v. Professional Building Maintenance Industries, Inc., supra, where the various counties of the overbroad restriction were simply listed.
[13] Although Hunt testified Slisz would not have known "exact suppliers" utilized by Munzenreider had he not worked for that corporation, he failed to specify the precise significance of such fact. We note he additionally testified, with respect to such representatives, that it was "possible" they might not visit a particular business because "they might not be interested in the account or they have another account that they're protecting."
[14] Although Munzenreider also contends the instant action involving Slisz as a "managing partner" is in some sense distinguishable from various employer-employee cases supporting our decision herein, he presents no cogent argument (nor can we envision any) why a different result is required. Of course, the reasoning of this opinion does recognize, as observed in Donahue v. Permacel Tape Corp., supra, that cases involving the sale of a business or profession present a somewhat different line of authority in the area of covenants not to compete, and the reasoning of this opinion is not designed to address those cases.
[15] As discussed earlier in this opinion, the Court in Donahue determined the only "confidential information" in that case related to "sales methods, lists of customers, customer requirements, etc., in the area worked," id. at 405, 127 N.E.2d at 240 (emphasis in original) and ultimately determined there was no evidence of any other confidential or secret information the competitive use of which could result in irreparable injury outside the area of the sales representative's actual employment. Thus, a broad covenant encompassing the United States and Canada was held to be unenforceable.
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105 B.R. 433 (1989)
In re CRAMER, INC., dba Physicians Weightloss Center, Debtor.
Bankruptcy No. 89-20806-K.
United States Bankruptcy Court, W.D. Tennessee, W.D.
September 12, 1989.
David M. Monypeny, Memphis, Tenn., for debtor.
Jimmy L. Croom, Memphis, Tenn., for Eighth Regional U.S. Trustee.
Gary A. Vanasek, Asst. U.S. Atty., Memphis, Tenn.
MEMORANDUM ORDER DENYING DEBTOR'S "REQUEST" PURSUANT TO 11 U.S.C. § 1121(d) SEEKING TO ENLARGE EXCLUSIVITY PERIOD TO FILE REORGANIZATION PLAN
DAVID S. KENNEDY, Chief Judge.
This core proceeding[1] came on to be heard on September 11, 1989, upon the "Motion To Extend Time For Filing Of Bankruptcy Disclosure Statement And Plan Of Reorganization" filed by the abovenamed Chapter 11 debtor continued in possession ("Debtor"). Debtor seeks an order pursuant to 11 U.S.C. § 1121(d) enlarging the statutory exclusivity period in which to file the Chapter 11 reorganization plan.
BACKGROUND INFORMATION
The relevant background information may be very briefly stated as follows: On February 15, 1989, the debtor filed an original petition under Chapter 11 of the Bankruptcy Code. On August 3, 1989, the debtor filed the instant "Motion To Extend Time For Filing Of Bankruptcy Disclosure Statement And Plan Of Reorganization" setting forth, inter alia, apparent good cause for the issuance of an order increasing the initial 120-day exclusivity period to file the plan referred to in 11 U.S.C. § 1121, infra. After notice and hearing and no prior enlargements having been granted to file the plan, the court denied the instant motion notwithstanding that "cause" apparently exists under 11 U.S.C. § 1121(d) to enlarge such time.
QUESTION PRESENTED
The ultimate question for judicial determination here is whether the bankruptcy court may enlarge or increase the exclusive statutory period to file a plan pursuant to 11 U.S.C. § 1121, infra, where the "request" under 11 U.S.C. § 1121(d) is made beyond the expiration of the initial 120-day exclusivity period and without any prior enlargements thereof having been granted.
11 U.S.C. § 1121
11 U.S.C. § 1121 sets forth the identity of the parties who are permitted to file Chapter 11 plans. Although the statute extends the right to file a plan to any "party in interest", the debtor is given the exclusive right to file a plan within 120 days of the filing of the voluntary petition. 11 U.S.C. § 1121(b). The debtor is then granted 180 days in which to obtain acceptances of the plan. The 120 and 180 day periods run concurrently. As noted, the *434 time period referred to in § 1121 is commonly called the debtor's "period of exclusivity". § 1121 grants the bankruptcy court discretion, upon the "request" of a party in interest and a finding of "cause", to increase (or reduce) the debtor's period of exclusivity. 11 U.S.C. § 1121(d); In re Gibson & Cushman Dredging Corp., 101 B.R. 405, 407 (E.D.N.Y.1989); In re Perkins, 71 B.R. 294, 297 (W.D.Tenn.E.D. 1987); In re Texaco, 76 B.R. 322 (Bankr. S.D.N.Y.1987).
11 U.S.C. § 1121 is styled "[w]ho may file a plan" and provides as follows:
"(a) The debtor may file a plan with a petition commencing a voluntary case, or at any time in a voluntary case or an involuntary case.
"(b) Except as otherwise provided in this section, only the debtor may file a plan until after 120 days after the date of the order for relief under this chapter.
"(c) Any party in interest, including the debtor, the trustee, a creditors' committee, an equity security holders' committee, a creditor, an equity security holder, or any indenture trustee, may file a plan if and only if
"(1) a trustee has been appointed under this chapter;
"(2) the debtor has not filed a plan before 120 days after the date of the order for relief under this chapter; or
"(3) the debtor has not filed a plan that has been accepted, before 180 days after the date of the order for relief under this chapter, by each class of claims or interests that is impaired under the plan.
"(d) On request of a party in interest made within the respective period specified in subsections (b) and (c) of this section and after notice and a hearing, the court may for cause reduce or increase the 120-day period or the 180-day period referred to in this section."
CONCLUSIONS
Although the hallmark of 11 U.S.C. § 1121 is flexibility,[2] once the respective periods specified in subsections (b) and (c) of this section (or enlargements thereof) have expired, the bankruptcy court is powerless to grant further extensions. In re Perkins, 71 B.R. 294, 297 (W.D.Tenn. E.D.1987). Cf. In re Westgate General Partnership, 55 B.R. 562 (Bankr.Ct.Pa. 1985).
Notwithstanding the existence of "cause" as contemplated in 11 U.S.C. § 1121(d), in this case the Bankruptcy Court's power to grant an enlargment or increase of the initial 120-day exclusivity period to file the Chapter 11 plan expired 120 days after the date of the order for relief on February 15, 1989. 11 U.S.C. § 1121(b). Accordingly, the debtor's instant motion under 11 U.S.C. § 1121(d) is denied as being untimely filed. Of course, the debtor may still file a plan. 11 U.S.C. § 1121(c). Debtor's exclusivity period, however, has aborted.
The foregoing shall serve as the court's findings of fact and conclusions of law in accordance with Bankr. Rule 7052.
IT IS SO ORDERED.
NOTES
[1] 28 U.S.C. § 157(b)(2)(A).
[2] See H.R.Rep. No. 95-595, 92 Cong., 2d Sess. 232, reprinted in 1978 U.S.Code Cong. & Admin. News 5787, 6191.
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Wniteb $>fates QCourt of jfeberal QClaims
No. 18-630 C
Filed: October 5, 2018
WAYNE HALL,
Pro Se Plaintiff,
v.
UNITED STATES OF AMERICA,
Defendant.
Wayne Hall, prose plaintiff.
Sosun Bae, Esquire, United States Department of Justice, Civil Division,
Washington, D.C., for defendant.
ORDER AND OPINION
Plaintiff Wayne Hall filed a Complaint in May 2018 alleging a violation of his
Fourth Amendment rights during an altercation with a "public servant." The United States
timely filed a Motion to Dismiss for lack of subject matter jurisdiction pursuant to RCFC
12(b)(l). Mr. Hall's claim is described, in his words, as follows:
They failed to protect my constitutional rights by conspiring to violate my
right to life, liberty, and the pursuit of happiness. 4th bill of right search and
seizure was violated ... I was involved in an incident in which a public
servant, Christopher Saldivia asked for my identification information. Upon
receiving some, he began to assume, presume who I am. Chris Saldivia,
along with Frank Laboy and Brendan Stapleton, began to assault and kidnap
me. I was pepper sprayed, choked, and placed under false arrest for not
providing my information, thus violating my constitutional rights. In my
duress, I contacted a friend to the scene in order to document the occurrence.
She was also kidnapped.
We accept as true all well-pleaded allegations of fact when considering a motion to
dismiss, and view the facts in a light most favorable to the plaintiff. United States v. Ford
Motor Co., 497 F.3d 1331, 1336 (Fed. Cir. 2007). The Supreme Court has ruled that
-1-
7017 2620 0000 7637 444 •
pleadings filed by plaintiffs who proceed pro se are held to less rigid standards than those
of parties represented by counsel. Hughes v. Rowe, 449 U.S. 5, 9 (1980). Prose plaintiffs
nevertheless bear the burden of establishing by a preponderance of the evidence that all
jurisdictional requirements are satisfied. Bernard v. United States, 59 Fed. Cl. 497, 499
(2004); Reynolds v. Army & Air Force Exch. Serv., 846 Fed. 2d 746, 748 (Fed. Cir. 1988).
The court must dismiss an action if we determine "at any time that [we] lack subject matter
jurisdiction." RCFC 12(h)(3).
The United States Court of Federal Claims has jurisdiction over "any claim against
the United States founded either upon the Constitution, or any Act of Congress or any
regulation of an executive department, or upon any express or implied contract with the
United States." 28 U.S.C. § 149l(a)(l) ("Tucker Act"). The Tucker Act provides the
waiver of sovereign immunity that allows an action for money damages to be brought
against the United States, but plaintiffs must establish a separate source within a contract,
regulation, statute, or constitutional provision that reasonably authorizes payment of
money to a plaintiff for violation of the contract, statute, or other provision. United States
v. Testan, 424 U.S. 392, 398 (1976).
Mr. Hall's complaint contains a variety of allegations against the United States,
including "conspiracy against rights, deprivation of rights under color of law, violation of
constitutional rights ... , government seals wrongfully used and instruments wrongfully
sealed, extortion by officers or employees of the United States ... mailing threatening
communications from a foreign country, threats and extortion against foreign officials,
official guests, or internationally protected persons, kidnapping, [and] malfeasance,
misconduct, and negligence." Mr. Hall's claims do not confer subject matter jurisdiction
on this court, however. None of his allegations establish the "separate source" within a
contract, regulation, statute, or constitutional provision that reasonably authorizes payment
of money to a plaintiff for their violation. This court has jurisdiction over claims arising
under the takings and just compensation clauses of the Fifth Amendment to the
Constitution, but Mr. Hall does not allege a claim based on either clause.
CONCLUSION
We GRANT plaintiffs Motion for Leave to proceed in Jonna pauperis for the
purpose of dismissing his complaint. For the reasons stated above, we GRANT defendant's
Motion to Dismiss for lack of subject matter jurisdiction. The Clerk of Court will DISMISS
plaintiff's complaint pursuant to RCFC 12(b)(l). No costs.
IT IS SO ORDERED.
-2-
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257 F.Supp. 991 (1966)
Shane STROMSODT, a minor, by Robert M. Stromsodt, his guardian ad litem, Plaintiff,
v.
PARKE-DAVIS AND COMPANY, a corporation, Defendant.
Civ. No. 3992.
United States District Court D. North Dakota, Northeastern Division.
September 28, 1966.
*992 Melvin M. Belli, of Belli, Ashe, Gerry & Ellison, San Francisco, Cal., Mart R. Vogel, of Wattam, Vogel, Vogel, Bright & Peterson, Fargo, N. D., Carlton G. Nelson, and Jerome J. Mack, of Nelson & Mack, Grand Forks, N. D., for plaintiff.
Harold D. Shaft, of Shaft, Benson, Shaft & McConn, Grand Forks, N. D., for defendant.
MEMORANDUM AND ORDER
RONALD N. DAVIES, District Judge.
This is a product liability case tried to the Court without jury, involving the ethical drug Quadrigen made by the Defendant, Parke-Davis and Company, containing four antigens: diphtheria toxoid, tetanus toxoid, pertussis (whooping cough) vaccine and poliomyelitis vaccine. It was also described as a quadruple antigen with a prophylaxis against diphtheria, pertussis, tetanus and poliomyelitis. Jurisdictional requirements of 28 U.S.C.A. § 1332, have been met.
The Plaintiff was originally shown as "Robert M. Stromsodt, guardian ad litem of Shane Stromsodt, a minor." By ex parte order entered by this Court April 1, 1966, leave was granted Plaintiff to amend the caption of the amended complaint to include "and Robert M. Stromsodt, individually." The Defendant moved the Court to set aside this order, urging that it was given no opportunity to object to it and contending that the North Dakota Statute of Limitations had run as against any claim of Robert M. Stromsodt, individually. A ruling was reserved on this motion.
To make certain that the issues are solidly joined in this cause, and that its ultimate resolution may not be attacked by reason of any real or fancied future claim to which the Defendant may think itself exposed, the Defendant's motion, upon which ruling was reserved, must be and it is hereby granted. The Defendant's motion to dismiss the cause of action as to Robert M. Stromsodt, individually, must be and it is hereby granted, for the reason that the complaint fails to state a cause of action as to Robert M. Stromsodt, individually. This case is ordered captioned as it appears herein, that is, "Shane Stromsodt, a minor, by Robert M. Stromsodt, his guardian ad litem, Plaintiff, versus Parke-Davis and Company, a corporation, Defendant," and as so styled it will be adjudicated.
In 1953 Parke-Davis commenced studies for the purpose of determining the feasibility of combining poliomyelitis vaccine with the company's trivalent antigen sold under the trade name "Triogen," containing diphtheria toxoid, tetanus toxoid and pertussis vaccine. Parke-Davis' product, Quadrigen, which has heretofore been described, was finally developed and licensed March 25, 1959, and its manufacture authorized by the Department of Health, Education and *993 Welfare (HEW). Commercial marketing of the drug under the trade name "Quadrigen" commenced in July of 1959 with Quadrigen having an expiration dating period of twelve months after manufacture, and six months after issue.
On April 13, 1961, the Division of Biologics Standards (DBS) of the National Institutes of Health (NIH) issued a memorandum to manufacturers of multiple antigen products containing pertussis and poliomyelitis vaccines that the products could contain no less than 14 units of pertussis potency (previously 12) and be labeled with an expiration date of six months after manufacture, and four months after issue. This change was necessitated when studies indicated a significant loss of pertussis potency in quadruple antigen vaccines after marketing. No comparable loss of pertussis potency had been found in triple antigen products not containing poliomyelitis vaccine.
DBS then determined that some lots of inactivated poliomyelitis vaccine contained a live vacuolating agent, (SV 40), from the monkey kidney cells on which poliomyelitis virus was grown. Resultantly, a memorandum was issued May 20th, 1961, requiring the subsequent lots of vaccines containing components grown on monkey kidney cells be free of live SV 40.
On August 23, 1961, DBS issued a regulation or letter placing a new toxicity test requirement on all products containing pertussis vaccines; and on September 21, 1961, provided a new reference vaccine for the pertussis potency test which effected an additional increase in the potency requirement. The new toxicity test required additional treatment of the pertussis component. This treatment adversely affected the pertussis potency to the extent that the potency requirement could not consistently be met. Various articles appearing in medical literature indicated that the poliomyelitis component and the preservative being used might be the cause of the instability in multiple vaccines. Production and marketing of "Quadrigen" was finally halted in November, 1962.
Shane Stromsodt was born in Grand Forks, North Dakota, May 24th, 1959. His mother's pregnancy and his birth were entirely normal and uneventful, according to her physician, Dr. John H. Graham. On August 26th, 1959, Shane was taken for examination to Dr. Graham's office; and on that date Quadrigen was administered to him intermuscularly. The infant seemed to suffer no ill effects, and his mother recalled no reaction which caused her any alarm. On October 1, 1959, some five weeks later, Shane was again taken to Dr. Graham's office, examined and once more Quadrigen was injected into the child's body, between four and five o'clock that afternoon. Mrs. Stromsodt bundled up the child and took him to the family car in which her husband, Robert, was waiting. She reached the car some five or ten minutes after Shane had received the Quadrigen, removed the blankets from about the child, and noticed a fine red rash on his face.
The Stromsodts drove to their home where Shane was undressed, and the rash noticed on his face and the upper part of his body. Mrs. Stromsodt gave Shane his bottle immediately after the family had their meal. Shane promptly vomited the bottle's contents, something he had never done before. Mrs. Stromsodt laid the child on the bed and testified the baby had a "seizure." She described his eyes as rolling back in his head, his heels and head dug into the bed, his back arched and his fingers grasping. Mrs. Stromsodt believes the convulsion may have lasted five minutes. Having no idea of what was happening, she watched Shane and when the seizure was over, telephoned Dr. Graham. She described to the Doctor what had happened to Shane and added that she thought the baby had the measles. The Doctor, however, thought it was a reaction from the shot given Shane and instructed Mrs. Stromsodt to watch him and to telephone next morning if the child was no better. Shane seemed normal the next morning, and Mrs. Stromsodt did not call the Doctor *994 nor see him again until November 4, 1959, when the baby was taken to Dr. Graham's office for a third shot. Shane slept most of the next two days following the initial seizure, but he had two more convulsive attacks after the first one, both of which were prior to November 4, 1959.
When Shane was taken to Dr. Graham's office November 4, 1959, Mrs. Stromsodt recited his condition to the Doctor. She told him the baby had suffered from two "spells" since the last Quadrigen shot, that he had been sleeping more and "it seemed like he wasn't doing anything any more." In short, the child was not progressing normally. The Doctor concluded that Shane should not be given Quadrigen because of the severe reaction suffered by the infant following the October 1 injection of that drug, and thus, on his third trip Shane was given Triogen which contained diphtheria toxoid, pertussis vaccine and tetanus toxoid (DPT). Poliomyelitis vaccine was not given on this date.
Shane continued to have difficulties which stemmed from the October 1st introduction of Quadrigen into his body and repeatedly had seizures until January, 1960. Mrs. Stromsodt testified the baby was making no progress. On January 13, 1960, the Stromsodts sought the advice of a specialist in pediatrics and took Shane to Dr. Samuel L. Pettit in Grand Forks. The Doctor prescribed phenobarbital for the child and testified that he finally prescribed a conventional dosage of one-quarter grain phenobarbital three times a day for Shane, which amounts he continues to receive.
When trial of this case began Shane was nearly seven years old. The record shows he walks unsteadily, lacks coordination, speaks but a few words, has none of the basic childhood skills normally possessed by children of his age and can neither read nor write. Uncontraverted medical testimony disclosed that he has damage to the brain and central nervous system. Shane is definitely, permanently and irreversibly injured, and in all probability his parents shortly will be unable to give him the necessary care and the boy will have to be institutionalized.
A careful weighing of all the credible medical testimony in this case leads this Court to the inescapable conclusion that the competent producing cause of Shane Stromsodt's condition was Quadrigen, and that chronologically and etiologically Shane's condition is traced directly to the Quadrigen administered to him October 1st, 1959.
Of the several theories under which the Plaintiff seeks to recover in this action, only two are sustainable and require discussion here. They are breach of an implied warranty and negligence.
Breach of Implied Warranty
"The liability in negligence of a manufacturer or other supplier for damage caused by his product is based on the supplier's failure to exercise reasonable care. Hence, negligence is a tort concept based on fault.
"Although the courts are occasionally confused about the matter, warranty, on the other hand, is not a concept based on fault or on the failure to exercise reasonable care. But this does not mean that warranty is necessarily contractual or nontortious in nature. Liability in warranty arises where damage is caused by the failure of a product to measure up to express or implied representations on the part of the manufacturer or other supplier. Accordingly, an injured person is not required to prove negligence in a warranty-products liability case.
"This has been concisely summarized as follows:
"`There seems to be some confusion in understanding the nature of implied warranty liability. In the first place, concepts of negligence and fault, as defined by negligence standards, have no place in warranty recovery cases. Proof of negligence is unnecessary to liability for breach of implied warranty and lack of it is immaterial to defense thereof. Since the warranty *995 is implied [emphasis by court], either in fact or in law, no express representations or agreements by the manufacturer are needed. Implied warranty recovery is based upon two factors: (a) The product or article in question has been transferred from the manufacturer's possession while in a "defective" state, more specifically, the product fails either to be "reasonably fit for the particular purpose intended" or of "merchantable quality," as these two terms, separate but often overlapping, are defined by the law; and (b) as a result of being "defective," the product causes personal injury or property damage.'" 2 Frumer & Friedman, Products Liability, Chapter 3, Sec. 16.01[1].
None of the experts called by either party could or would state which particular ingredient in Quadrigen caused the damage to Shane Stromsodt. Plaintiff's witness, Dr. Ronald Okun, testified that there was evidence to show that pertussis endotoxin made the other components of Quadrigen more liable to cause an anaphylactic sort of reaction in a patient. Other evidence indicated that the product was rendered defective by the instability of potency in the pertussis vaccine. The evidence justifies the conclusion that the Plaintiff's injuries and damages were caused by a defect in the Quadrigen, and that such defect constitutes a breach of the implied warranty of merchantability.
The asserted lack of privity is not a defense in North Dakota to a claim based upon breach of an implied warranty. See Lang v. General Motors Corporation, 136 N.W.2d 805 (N.D.1965). This apparently would be particularly true in actions by the ultimate consumer against a manufacturer for breach of implied warranties where "through advertising or other media of education and information defendant has convinced and persuaded the medical profession to prescribe its drug, since it is in the very competitive field of supplying drugs and medicines for the alleviation of human suffering as well as for its own pecuniary advantages." Bennett v. Richardson-Merrell, Inc., D.C., 231 F.Supp. 150.
Negligence
The finding that Parke-Davis breached the implied warranty of merchantability and that Plaintiff's injuries were caused thereby does not preclude a finding that the Defendant is also chargeable with negligence in failing adequately to test the product and adequately to warn of the dangers inherent in its use.
The insert,[1] under "Reactions", reads:
"When given in accordance with suggested methods, local and systemic reactions following the administration of Quadrigen are usually mild. The incidence is usually no greater than is normally experienced with trivalent vaccine. Local reactions and fever of short duration may occur, however, and parents should be cautioned not to apply local treatment, such as wet dressings or heat. Any child who shows a febrile reaction should be kept quiet, should be offered water repeatedly and may be given one or more doses of aspirin as indicated. Occasionally, a residual induration or circumscribed nodule may persist for a week or more.
"In instances of more marked reaction, the immunization may be completed *996 with monovalent antigens or other combinations of antigens.
"Local reactions have been known to be more severe when the child is in the incubative stage of pertussis. Encephalitic symptoms occasionally occur with acute pertussis though rarely with the use of the prophylactic vaccine. Such severe symptoms of the central nervous system include convulsions and lethargy. They may be followed by mental or physical manifestations, sometimes permanent, or even by death; but fortunately such reactions are extremely rare.
"The poliomyelitis vaccine components of Quadrigen contains small amounts of penicillin and streptomycin used in culturing the virus. During the adsorption process most of the antibiotic content is removed. In fact, residual antibiotics in the adsorbed product are usually not demonstrable by ordinary laboratory technics. However, consideration should be given to the possibility of allergic reactions in individuals sensitive to these antibiotics and they should be tested for sensitivity where this possibility exists.
"The value and importance of maintaining continuing antibody levels in the infant in relation to the possibility of provocation of paralytic poliomyelitis by injection are self-evident. In modern clinical practice the administration of medication by hypodermic injection is generally accepted, and the hazard of thereby provoking poliomyelitis is increasing. If, however, basic immunity against poliomyelitis as evidenced by circulating antibody has been achieved, provocation is quite unlikely. Also, it should be noted that Quadrigen is considered less likely to provoke paralysis than is the trivalent product not containing poliomyelitis vaccine. With products not containing poliomyelitis antigen the patient is at some risk following each injection. With Quadrigen, on the other hand, after the first injection, basic immunity is developing and risk is greatly decreased for subsequent inoculations. Furthermore, if current recommendations are followed, the course of immunization will be started during the first 6 months of life under the protection of passive maternal antibody. However, the hazard of provocation in the face of an epidemic, particularly with the first dose of Quadrigen, cannot be ignored and the physician should exercise discretion, as with any injectable."
Clinical trials of Quadrigen prior to marketing were conducted by Dr. Clarence D. Barrett of Detriot beginning in 1956 and terminating in 1959. These tests used Quadrigen considered "fresh" in that the product was less than six months of age from the date of "pooling" of the poliomyelitis component with the DPT fraction. The trials were designed to determine antibody response and the earliest age in infancy at which immunization against poliomyelitis, diphtheria, tetanus and pertussis would be started, using a multiple antigen against all four diseases. No clinical reactions of any serious consequence were reported or observed.
Quadrigen was then made available to selected members of the medical profession who were requested to comment on their use of the product. These "field trials" indicated a marked increase in reactions among patients given Quadrigen over those being given DPT and poliomyelitis vaccine. Of the severe reactions reported the first apparent instance in which death resulted was in March of 1959. It does not appear that Parke-Davis made any effort to determine the cause of the high incidence of reactions, and only a cursory attempt was made to investigate the cause of a death attributed to the use of Quadrigen.
It appears to this Court that adequate tests performed prior to marketing would have disclosed the product's potency instability as well as the cause of greater incidence of reaction, especially in view of the number and seriousness of the reactions being reported. This was not a situation where an epidemic *997 existed or where need justified the risk of premature marketing since products were already available to the medical profession that satisfactorily accomplished that Quadrigen was designed to do.
Although all of the Government regulations and requirements had been satisfactorily met in the production and marketing of Quadrigen, the standards promulgated were minimal. The Defendant still owes a duty to warn of dangers of which it knew or should have known in the exercise of reasonable care. Love v. Wolf, 226 Cal.App.2d 378, 38 Cal.Rptr. 183. See also Ebers v. General Chemical Co., 310 Mich. 261, 17 N.W. 2d 176; Brown v. Globe Laboratories, 165 Neb. 138, 84 N.W.2d 151; Gonzalez v. Virginia-Carolina Chemical Company, 239 F.Supp. 567 (DC, SC, 1965).
The danger must be reasonably foreseeable and the injury must be proximately caused by the failure to warn. The Defendant knew or should have known that Quadrigen might cause encephalopathies in some users and to warn of the danger.
Though this may have been the first case in which encephalopathy[2] occurred after the administration of Quadrigen, it does not preclude the finding of foreseeability and negligence. See Roberts v. United States, 316 F.2d 489 (3 Cir., 1963).
The warning "Local reactions have been known to be more severe when the child is in the incubative stage of pertussis" on the insert accompanying the product, not only would not have warned members of the medical profession, but might have misled them to believe that only in cases where the child was in the incubative stage of pertussis would encephalitic symptoms occasionally occur.
There is no competent evidence in the entire record, medical or otherwise, to show that Shane's condition arose out of or from any susceptibility or predisposition, nor that the child had any congenital disease or disorder or defect of any kind, nor that he had any allergy or idiosyncrasy, nor that heredity was a factor that might account for his present condition.
This Court being of the opinion that the Defendant is liable both for breach of an implied warranty and for negligence, it becomes unnecessary to forecast whether the Supreme Court of North Dakota would apply Sec. 402 A of the Restatement of Torts in a situation such as is here presented.
As pointed out in 2 Frumer-Freidman, Chapter 3, Sec. 16A [4]:
"Strict liability in tort in the products liability area is in its infancy. Therefore, the precise scope of the rule and the defenses thereto have not as yet been clearly defined. It is believed, however, that strict liability in tort is for the most part no different than strict liability in warranty, that similar results can be achieved under either theory. Comment m to § 402A of the Restatement of Torts seems to agree. It states:
"`There is nothing in this section which would prevent any court from treating the rule stated as a matter of "warranty" to the user or consumer.'
"But in the next sentence it is pointed out that,
"`if this is done, it should be recognized and understood that the "warranty" is a very different kind of warranty from those usually found in the sale of goods, and that it is not subject to the various contract rules which have grown up to surround such sales.'
"If a court does not require, inter alia, privity of contract, a sale, or notice of a breach of warranty, does it matter that the defendant is being held strictly liable in warranty rather than in tort? The answer seems obvious. If a court imposes strict warranty liability irrespective of contract and sales rules, then strict liability *998 in warranty and tort are synonymous."
The Plaintiff has sustained the burden of proving, by a fair preponderance of the credible evidence adduced upon trial, that Parke-Davis has breached an implied warranty, and in addition, has been guilty of tortious negligence. The verdict which this Court reaches, and the damages awarded, are supported by either one or both of these theories.
It is my conclusion that the sum of $500,000.00 constitutes a fair, just and adequate award to Shane Stromsodt, considering the totality of circumstances in this lawsuit.
Counsel for the Plaintiff are directed to prepare and submit through the Clerk of this Court findings of fact, conclusions of law, order for judgment and judgment with the least practicable delay.
NOTES
[1] Exhibit 46 is a tiny bottle of Quadrigen contained in a small cardboard box which included also Parke-Davis' insert showing what the product was designed to do. It is observed that the bottle itself contained no warning whatever, the cardboard box in which it was enclosed contained no warning whatever. The insert itself, a single sheet of paper containing in the main very small print, showed the nature of the product, when to immunize, dosage and administration, recall or booster doses, reactions and storage instructions, and was printed on a sheet measuring approximately four by seven inches, in which were compressed approximately 1,444 words, excluding the reference list on the bottom of the reverse side.
[2] Any degenerative disease of the brain.
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323 F.3d 661
Dallas FLETCHER and Katherine Fletcher, Appellants,v.CONOCO PIPE LINE COMPANY, Appellee.
No. 02-1345.
United States Court of Appeals, Eighth Circuit.
Submitted: November 8, 2002.
Filed: March 24, 2003.
Rehearing Denied: May 6, 2003.
Craig R. Heidemann, argued, Bolivar, MO, for appellant.
Richard P. Jacobs, argued, St. Louis, MO (Joseph C. Orlet and Scott K.G. Kozak, on the brief), for appellee.
Before RILEY, BEAM, and SMITH, Circuit Judges.
RILEY, Circuit Judge.
1
Dallas and Katherine Fletcher (Fletchers) appeal the district court's1 entry of summary judgment in favor of Conoco Pipe Line Company (Conoco). The Fletchers also allege the district judge erred in failing to recuse himself sua sponte pursuant to 28 U.S.C. § 455(a) (2000). We affirm.
I. BACKGROUND
2
The Fletchers own a farm in Laclede County, Missouri. Conoco owns and operates petroleum and petrochemical pipelines that run across and adjacent to the Fletchers' farm. To reduce corrosion in the steel pipelines, Conoco employs a cathodic protection system that passes electrical current through the ground and through the steel pipelines.
3
The Fletchers claim "stray electricity" escaped from Conoco's cathodic protection system on its easement and traveled onto Fletchers' property, causing them to suffer property damage, lost profits, personal injuries, loss of consortium, and loss of enjoyment of life. They filed this lawsuit against Conoco alleging claims of inverse condemnation, nuisance, trespass, ordinary negligence, and negligence based on res ipsa loquitur.
4
On June 17, 1998, Conoco sent a cathodic expert to test for stray voltage coming from the rectifier ground bed located on the Fletchers' property. Attorney James E. Baldwin (Baldwin) observed the testing and took notes. Baldwin has represented the Fletchers in various legal matters since 1972, and, according to Dallas Fletcher, Baldwin represented the Fletchers in this case. The Fletchers disclosed Baldwin as a trial witness.
5
Conoco moved for summary judgment contending the Fletchers lacked proof Conoco caused any of their damages. In opposition, the Fletchers submitted several affidavits, including one by Baldwin, attesting to his observations of the testing performed by Conoco's expert. Conoco moved to strike Baldwin's affidavit. The district court denied the motion, ruling "Baldwin's testimony regarding volt meter readings should not be stricken." The district court did enter an order striking several of the Fletchers' witnesses, including Baldwin, precluding them from testifying at trial. On the same day, the district court granted summary judgment in favor of Conoco.
6
After the district court entered summary judgment, Dallas Fletcher prepared an affidavit attesting Baldwin informed him that Baldwin and Judge Whipple are close personal friends who have known each other for thirty-six years and who regularly hunt and camp together. In the same affidavit Fletcher reported Baldwin told him Judge Whipple was an individual client of Baldwin's law firm, Donnelly, Baldwin & Wilhite, P.C., in an ongoing matter. The Fletchers' trial counsel, Craig Heidemann (Heidemann), also prepared a corroborating affidavit attesting Baldwin told him the same information, with the added assertion that Baldwin said he believed a conflict of interest existed.
7
In light of these revelations, the Fletchers contend Judge Whipple was required under 28 U.S.C. § 455(a) to recuse himself sua sponte based on the appearance of partiality arising from his personal friendship with Baldwin, as well as his ongoing client relationship with Baldwin's law firm. The Fletchers also claim the district court erred in granting summary judgment. The Fletchers seek an order vacating summary judgment and reassigning the case to another district judge.
II. DISCUSSION
A. Judicial Disqualification
8
Precedent exists in this circuit for reviewing recusal claims first raised on direct appeal. See United States v. Mosby, 177 F.3d 1067, 1068-69 (8th Cir.1999) (defendant claiming judge erred by failing to recuse himself sua sponte pursuant to § 455(a)); United States v. Tucker, 78 F.3d 1313, 1322-24 (8th Cir.1996) (direct appeal seeking recusal of district judge pursuant to appellate court's supervisory authority, 28 U.S.C. § 2106, "where, in the language of 28 U.S.C. § 455(a) (1994), district judge's `impartiality might reasonably be questioned'"). Given this precedent, we must review the merits of the recusal claim.
9
Ordinarily, we review a judge's refusal to recuse for an abuse of discretion. Moran v. Clarke, 296 F.3d 638, 648 (8th Cir.2002). However, when a recusal claim is not raised below, we apply a lower standard of appellate review and review only for plain error. Cf. United States v. Young, 223 F.3d 905, 908 (8th Cir.2000) (district court's decision that protection afforded plea statements applied to affidavits before the court was reviewed for plain error where claim was not raised below). Our review under the plain error standard is "narrow and confined to the exceptional case where error has seriously affected the fairness, integrity, or public reputation of the judicial proceedings." Chem-Trend, Inc. v. Newport Indus., Inc., 279 F.3d 625, 629 (8th Cir.2002) (citation omitted). We will only reverse if the error prejudiced the substantial rights of the Fletchers and would result in a miscarriage of justice. See id.
10
Under section 455(a), a judge is required to "disqualify himself in any proceeding in which his impartiality might reasonably be questioned." 28 U.S.C. § 455(a). Congress amended section 455 in 1974 "to clarify and broaden the grounds for judicial disqualification and to conform with the recently adopted ABA Code of Judicial Conduct, Canon 3C (1974)." Liljeberg v. Health Servs. Acquisition Corp., 486 U.S. 847, 858 n. 7, 108 S.Ct. 2194, 100 L.Ed.2d 855 (1988). We apply an objective standard of reasonableness in determining whether recusal is required. "Under § 455(a), `disqualification is required if a reasonable person who knew the circumstances would question the judge's impartiality, even though no actual bias or prejudice has been shown.'" Tucker, 78 F.3d at 1324 (citation omitted). "A party introducing a motion to recuse carries a heavy burden of proof; a judge is presumed to be impartial and the party seeking disqualification bears the substantial burden of proving otherwise." Pope v. Fed. Express Corp., 974 F.2d 982, 985 (8th Cir.1992) (citation omitted).
11
Although section 455 has no explicit timeliness requirement, we have ruled a claim for judicial recusal under section 455 "will not be considered unless timely made." United States v. Bauer, 19 F.3d 409, 414 (8th Cir.1994) (quoting Holloway v. United States, 960 F.2d 1348, 1355 (8th Cir.1992)). Timeliness requires a party to raise a claim "at the earliest possible moment after obtaining knowledge of facts demonstrating the basis for such a claim." Apple v. Jewish Hosp. & Med. Ctr., 829 F.2d 326, 333 (2d Cir.1987). A failure to raise a section 455 recusal claim can result in waiving or forfeiting judicial review. Cf. United States v. Mathison, 157 F.3d 541, 545-46 (8th Cir.1998) (explaining conscious choice not to raise issue results in waiver, whereas inadvertent inaction results in forfeiture); United States v. Olano, 507 U.S. 725, 731-33, 113 S.Ct. 1770, 123 L.Ed.2d 508 (1993) (discussing waiver and forfeiture of error under Fed.R.Crim.P. 52(b)).
12
On appeal, the distinction between waiver and forfeiture is an important one. If a party waives a recusal claim, then judicial review is precluded. Cf. Mathison, 157 F.3d at 545-46; Olano, 507 U.S. at 733, 113 S.Ct. 1770 (noting that waiver extinguishes error under Fed.R.Crim.P. 52(b)). If, however, a party forfeits an error, and the error is plain and affects substantial rights, then "the court of appeals has authority to order correction, but is not required to do so." Olano, 507 U.S. at 735, 113 S.Ct. 1770; United States v. Bayless, 201 F.3d 116, 127 (2d Cir.2000).
13
Section 455(e) contemplates waiver of a recusal claim based on an appearance of impropriety on the express condition that the waiver be "preceded by a full disclosure on the record of the basis for disqualification." 28 U.S.C. § 455(e). Neither Judge Whipple's alleged social relationship with Mr. Baldwin, nor his alleged client relationship with Baldwin's law firm, was disclosed on the record. Thus, pursuant to section 455(e), the Fletchers have not explicitly waived their right to raise the recusal claim.
14
Whether the Fletchers forfeited their recusal claim is a closer question. The record contains a letter dated July 18, 2001, written by Heidemann to Judge Whipple informing him "Mr. Baldwin will be filing his motion for admission pro hac vice and entry of appearance as co-counsel. Mr. Baldwin has been involved in this matter since 1997." Conoco contends this letter is evidence the Fletchers and their counsel either knew, or should have known, of Baldwin's relationship to Judge Whipple before entry of summary judgment and, therefore, forfeited their recusal claim by failing to raise it below. Mr. Fletcher's affidavit contains no time reference as to when Baldwin informed Fletcher of his relationship with Judge Whipple. Heidemann's affidavit states only that Baldwin informed him of Judge Whipple's relationship with Baldwin's law firm after December 17, 2001, the date on which Judge Whipple entered summary judgment. Curiously, Baldwin's affidavit dated March 28, 2002, is silent as to his and his law firm's relationship with Judge Whipple.
15
The docket sheet reflects Baldwin never entered his appearance as counsel in this case. No documents filed with or submitted to the court contain Baldwin's signature as an attorney. The fact Baldwin never filed his appearance suggests a tactical maneuver to avoid judicial disqualification, as well as to avoid the obvious conflict of interest of trial counsel testifying as a fact witness. Indeed, it strains credulity that Baldwin would not have fully disclosed to the Fletchers and their trial counsel his relationship with Judge Whipple well in advance of summary judgment. Whether a forfeiture occurred, requiring plain error review, or a forfeiture did not occur, requiring an abuse of discretion standard, recusal was not necessary under either standard of review.
16
After carefully reviewing the record, we conclude Judge Whipple was not required to recuse himself sua sponte under section 455(a). The record is void of objective evidence that Baldwin represented the Fletchers as an attorney in this particular case. Baldwin never filed an appearance as counsel. Instead, Baldwin was a fact witness who provided testimony in the form of a one and one-half page purely foundational affidavit submitted by the Fletchers in opposition to Conoco's motion for summary judgment.
17
The alleged relationship between Baldwin and Judge Whipple is based entirely on hearsay statements contained in Mr. Fletcher's affidavit. Even if we were to presume the truth of his statements, they establish merely a social relationship between a judge and a non-party fact witness. Generally, a court will deny a recusal claim alleging no more than a friendship between a judge and a witness because "the fact that a judge is a friend of a witness does not ordinarily warrant an inference that the judge would be predisposed to credit that witness' testimony." Richard E. Flamm, Judicial Disqualification—Recusal and Disqualification of Judges 257 & n.26-27(1996). See Holloway, 960 F.2d at 1351 (declaring fact that trial judge who denied defendant's motion to disqualify sentencing judge was a personal friend of sentencing judge did not compel disqualification); Hadler v. Union Bank & Trust Co. of Greensburg, 765 F.Supp. 976, 978 (S.D.Ind.1991) ("To conclude that this judge or any judge would ignore the law and his solemn oath in order to favor the testimony of a witness merely because of friendship with that witness one would have to engage in `speculation.'")
18
We conclude no reasonable member of the public would question Judge Whipple's partiality in this case. Judge Whipple denied Conoco's motion to strike Baldwin's affidavit and considered his affidavit before entering summary judgment. An adverse ruling does not constitute a sufficient basis for disqualification without a clear showing of bias or partiality. Liteky v. United States, 510 U.S. 540, 555, 114 S.Ct. 1147, 127 L.Ed.2d 474 (1994); Holloway, 960 F.2d at 1351(unfavorable judicial ruling "insufficient to require disqualification absent a showing of pervasive personal bias and prejudice.'"). Moreover, Judge Whipple granted summary judgment against the Fletchers, a decision contrary to the expectation of a reasonable person, if Judge Whipple had been biased in favor of Baldwin. See In re Apex Oil Co., 981 F.2d 302, 304 (8th Cir.1992) (noting that a reasonable person would not question a judge's impartiality when a judge rules contrary to his alleged bias). Having carefully examined the record, we find no plain error.
B. Summary Judgment
19
We review de novo a district court's grant of summary judgment. Bowen v. Mo. Dept. of Soc. Servs., 311 F.3d 878, 880 (8th Cir.2002). A court properly grants summary judgment when, viewing the facts and reasonable inferences in the light most favorable to the nonmoving party, it is clear no genuine issue of material fact remains and the case may be decided as a matter of law. Fed.R.Civ.P. 56(c).
20
The district court correctly ruled Missouri law applied to the Fletchers' claims. Under Missouri law, the claims for nuisance, trespass, ordinary negligence, and negligence based on res ipsa loquitur, as well as the claims alleging damage to livestock and personal property, must fail because the Fletchers offered no competent proof of causation. The court also granted summary judgment on the Fletchers' inverse condemnation claim for lack of causation evidence establishing diminution in property value caused directly by stray electricity from the cathodic protection system.
21
The Fletchers were required to prove causation. See, e.g., Heffernan v. Reinhold, 73 S.W.3d 659, 664 (Mo.Ct.App.2002) (negligence); Brand v. Mathis & Assoc., 15 S.W.3d 403, 406 (Mo.Ct.App.2000) (trespass); Zumalt v. Boone Co., 921 S.W.2d 12, 15 (Mo.Ct.App.1996) (inverse condemnation); Titone v. Teis Const. Co., 426 S.W.2d 665, 668-69 (Mo.Ct.App.1968) (nuisance claim "requires proof of one common and essential element, i.e., proximate cause"). Having carefully reviewed the record, we agree with the district court that the Fletchers failed to present competent evidence of causation creating a genuine issue of material fact. Mere evidence of electricity recorded on the property, without corresponding expert testimony or some clearly obvious evidence as to its source, harmful level, and ability to cause directly and foreseeably the injuries complained of, will not defeat summary judgment.
22
We also agree with Conoco that the Fletchers have waived their claims for nominal and punitive damages. See 8th Cir. R. 47B.
III. CONCLUSION
23
Finding no error, we affirm the district court's entry of summary judgment, deny Fletchers' recusal suggestion, and deny Conoco's motion to strike portions of the Fletchers' brief and appendix.
Notes:
1
The Honorable Dean Whipple, Chief Judge, United States District Court for the Western District of Missouri
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553 F.2d 103
Hamiltonv.U. S.
No. 76-2020
United States Court of Appeals, Eighth Circuit
3/16/77
1
W.D.Mo.
2
AFFIRMED**
**
See Local Rule 9
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880 F.2d 1318
Gomezv.Lefevre
NO. 88-2399(R)
United States Court of Appeals,Second Circuit.
JUN 29, 1989
1
Appeal From: N.D.N.Y.
2
AFFIRMED.
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981 So.2d 1179 (2006)
TIMOTHY LYNN PEDEN
v.
LIBERTY INN.
No. 2040833.
Supreme Court of Alabama.
January 27, 2006.
Decision of the Alabama Court of Civil Appeal without Opinion. Affirmed.
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372 F.3d 1159
UNITED STATES of America, Plaintiff-Appellee,v.Hector TORRES, Defendant-Appellant.
No. 03-2182.
No. 03-2241.
United States Court of Appeals, Tenth Circuit.
June 16, 2004.
Richard B. McClarkin, Albuquerque, NM, for Defendant-Appellant.
Laura Fashing, Assistant United States Attorney (David C. Iglesias, United States Attorney, with her on the brief), Albuquerque, NM, for Plaintiff-Appellee.
Before EBEL, HENRY, and HARTZ, Circuit Judges.
HARTZ, Circuit Judge.
I. BACKGROUND
1
Defendant Hector Torres pleaded guilty to conspiring to possess with intent to distribute more than 500 grams of cocaine, in violation of 21 U.S.C. §§ 841(a)(1), (b)(1)(B) and 846. He reserved his right to appeal the district court's denial of his motion to suppress statements and physical evidence. The judgment of conviction was entered on July 25, 2003. Defendant did not file a notice of appeal until August 12, 2003 — beyond the 10-day period for filing criminal appeals set forth in Federal Rule of Appellate Procedure 4(b)(1). The appeal was assigned number 03-2182.
2
Because the notice of appeal was filed more than 10 days but less than 40 days after entry of judgment, we partially remanded the appeal to the district court so that it could assess whether the delay in filing was due to excusable neglect, which could be grounds for a 30-day extension of the time to appeal. See Fed. R.App. P. 4(b)(4). Defendant then filed in district court a "Motion for Enlargement of Time and Leave to File Amended Notice of Appeal," explaining that defense counsel had incorrectly believed that Defendant had 30 days following entry of judgment in which to file an appeal. The district court granted the motion on October 7, 2003, finding that Defendant's untimeliness was the result of excusable neglect.
3
On October 7, 2003, Defendant filed a second appeal (assigned number 03-2241) seeking review of the district court's denial of his motion to suppress. The second appeal was consolidated with Defendant's first appeal (number 03-2182) for procedural purposes. We now dismiss both appeals for lack of jurisdiction because the district court abused its discretion in finding that the untimely filing of the notice of appeal was due to excusable neglect. Although the government has not challenged our jurisdiction to hear this appeal, "it is the duty of the federal court to determine the matter sua sponte." Basso v. Utah Power & Light Co., 495 F.2d 906, 909 (10th Cir.1974).
II. DISCUSSION
4
"A court of appeals acquires jurisdiction of an appeal only upon the filing of a timely notice of appeal[;] this requirement is mandatory and jurisdictional." Gooch v. Skelly Oil Co., 493 F.2d 366, 368 (10th Cir.1974). Federal Rule of Appellate Procedure 4(b)(1)(A) states:
5
In a criminal case, a defendant's notice of appeal must be filed in the district court within 10 days after the later of:
6
(i) the entry of either the judgment or the order being appealed; or
7
(ii) the filing of the government's notice of appeal.
8
But Rule 4 also provides that "[u]pon a finding of excusable neglect or good cause1, the district court may ... extend the time to file a notice of appeal for a period not to exceed 30 days from the expiration of the time otherwise prescribed by this Rule 4(b)." Fed. R.App. P. 4(b)(4). "When a district court grants an extension for excusable neglect, filing a notice of appeal within the thirty-day extension allowed by the rule establishes appellate jurisdiction." United States v. Leonard, 937 F.2d 494, 495 (10th Cir.1991). "[A] trial court's finding as to the presence or absence of `excusable neglect' as that term is used in Fed. R.App. P. 4 should not be overturned by us on appeal unless there has been a clear abuse of discretion." Gooch, 493 F.2d at 368.
9
The leading case on "excusable neglect" is Pioneer Investment Services Co. v. Brunswick Associates Limited Partnership, 507 U.S. 380, 113 S.Ct. 1489, 123 L.Ed.2d 74 (1993), in which the Supreme Court addressed the meaning of that term in Bankruptcy Rule 9006(b). The rule provides that:
10
when an act is required or allowed to be done at or within a specified period by these rules or by a notice given thereunder or by order of court, the court for cause shown may at any time in its discretion ... on motion made after the expiration of the specified period permit the act to be done where the failure to act was the result of excusable neglect.
11
The bankruptcy court had mailed a notice to creditors announcing a meeting and setting a bar date for filing proofs of claim against Pioneer. Pioneer, 507 U.S. at 383-84, 113 S.Ct. 1489. Although the president of the respondents' corporate general partners received the notice, the respondents failed to file a proof of claim by the bar date. Id. at 384, 113 S.Ct. 1489. The respondents sought relief under Rule 9006(b)(1), explaining that their attorney was not aware of the bar date because "he was experiencing a major and significant disruption in his professional life caused by his withdrawal from his former law firm," and thus did not have access to the case file until the bar date had passed. Id. at 384, 113 S.Ct. 1489 (internal quotation marks omitted). The bankruptcy court refused to accept the late filing on the ground that "a party may claim excusable neglect only if its failure to timely perform a duty was due to circumstances which were beyond its reasonable control." Id. (internal quotation marks and brackets omitted). The Supreme Court granted certiorari "[b]ecause of the conflict in the Courts of Appeals over the meaning of `excusable neglect.'" Id. at 387, 113 S.Ct. 1489.
12
The Court rejected the notion that excusable neglect exists only when a delay in filing is the result of circumstances beyond a party's control, stating that "by empowering the courts to accept late filings where the failure to act was the result of excusable neglect, ... Congress plainly contemplated that the courts would be permitted, where appropriate, to accept late filings caused by inadvertence, mistake, or carelessness, as well as by intervening circumstances beyond the party's control." Id. at 388, 113 S.Ct. 1489 (internal quotation marks omitted). The Court held that the determination whether a party's neglect is excusable "is at bottom an equitable one, taking account of all relevant circumstances surrounding the party's omission." Id. at 395, 113 S.Ct. 1489. Such circumstances include "[1] the danger of prejudice to the [nonmoving party], [2] the length of the delay and its potential impact on judicial proceedings, [3] the reason for the delay, including whether it was within the reasonable control of the movant, and [4] whether the movant acted in good faith." Id.
13
Although Pioneer did not involve the interpretation of the precise rule at issue in this case, it is nonetheless highly persuasive. The Court's discussion in Pioneer was not confined to Bankruptcy Rule 9006. Indeed, in explaining why it granted certiorari, the Court noted that the Courts of Appeals had "divided in their interpretations of `excusable neglect' as found in Rule 4(a)(5) of the Federal Rules of Appellate Procedure." Id. at 387 n. 3, 113 S.Ct. 1489. And the opinion extensively addressed nonbankruptcy rules that use the term "excusable neglect." See id. at 391-95, 113 S.Ct. 1489. To be sure, the Court recognized that the term might not have the same meaning in different rules, see id. at 394-95, 113 S.Ct. 1489 (discussing difference between Rule 9006(b)(1) and Fed.R.Civ.P. 60(b)(1)); but absent some specific reason to depart from Pioneer, we should follow the Supreme Court's lead.
14
Accordingly, in City of Chanute v. Williams Natural Gas Co., 31 F.3d 1041, 1046 (10th Cir.1994), we concluded that "[b]ecause the [Pioneer] Court's analysis of what constitutes `excusable neglect' in the bankruptcy context rested on the plain meaning of the terms, there is no reason that the meaning would be different in the context of Fed. R.App. P. 4(a)(5)." We now likewise conclude that the Supreme Court's construction of "excusable neglect" in Pioneer also applies to the term "excusable neglect" as it is used in Federal Rule of Appellate Procedure 4(b)(4). See 16A Wright, Miller & Cooper, Federal Practice & Procedure § 3950.9 at 250 (3d ed. 1999) ("It is beyond belief that `excusable neglect' would have one meaning in Appellate Rule 4(a) and a different meaning in Appellate Rule 4(b)."); cf. In re Vitamins Antitrust Class Actions, 327 F.3d 1207, 1210 (D.C.Cir.2003) (suggesting that special interest of courts of appeal in the filing of timely notices of appeal may justify stricter interpretation of "excusable neglect" in that context).
15
Applying the Pioneer factors to the facts of this case, we determine that the district court abused its discretion in finding excusable neglect. Three of the relevant circumstances noted in Pioneer weigh in favor of a finding of excusable neglect. Defendant filed his notice of appeal only 18 days after the entry of judgment; it does not appear that the government would be prejudiced by the delay if Defendant's appeal is permitted to proceed; and there is no indication that defense counsel acted in bad faith. Nonetheless, "fault in the delay remains a very important factor — perhaps the most important single factor — in determining whether neglect is excusable." City of Chanute, 31 F.3d at 1046; see Graphic Communications Int'l Union v. Quebecor Printing Providence, Inc., 270 F.3d 1, 5 (1st Cir.2001) ("We have observed that the four Pioneer factors do not carry equal weight; the excuse given for the late filing must have the greatest import." (internal quotation marks and bracket omitted)); Lowry v. McDonnell Douglas Corp., 211 F.3d 457, 463 (8th Cir.2000) (same).
16
The reason for the delay here was simply that defense counsel confused the filing deadlines for civil and criminal appeals. In Pioneer the Supreme Court said that "inadvertence, ignorance of the rules, or mistakes construing the rules do not usually constitute `excusable' neglect." Pioneer, 507 U.S. at 392, 113 S.Ct. 1489. Even after Pioneer adopted an equitable, balancing test, several circuits have embraced the rule that "`[t]he excusable neglect standard can never be met by a showing of inability or refusal to read and comprehend the plain language of the federal rules.' "Weinstock v. Cleary, Gottlieb, Steen & Hamilton, 16 F.3d 501, 503 (2d Cir.1994) (quoting In re Cosmopolitan Aviation Corp., 763 F.2d 507, 515 (2d Cir.1985)); accord Prizevoits v. Indiana Bell Tel. Co., 76 F.3d 132, 133 (7th Cir.1996); see Lowry, 211 F.3d at 464 ("Notwithstanding the `flexible' Pioneer standard, experienced counsel's misapplication of clear and unambiguous procedural rules cannot excuse his failure to file a timely notice of appeal."); Advanced Estimating Sys., Inc. v. Riney, 130 F.3d 996, 998 (11th Cir.1997) ("as a matter of law, ... an attorney's misunderstanding of the plain language of a rule cannot constitute excusable neglect such that a party is relieved of the consequences of failing to comply with a statutory deadline"); cf. Mirpuri v. ACT Mfg., Inc., 212 F.3d 624, 631 (1st Cir.2000) ("A misunderstanding that occurs because a party (or his counsel) elects to read the clear, unambiguous terms of a judicial decree through rose-colored glasses cannot constitute excusable neglect."); McCurry v. Adventist Health Sys./Sunbelt, Inc., 298 F.3d 586, 595 (6th Cir.2002) (interpreting Fed.R.Civ.P. 60(b)(1); "an attorney's inaction or strategic error based upon a misreading of the applicable law cannot be deemed `excusable' neglect"). And one circuit, although unwilling to be categorical on the matter, has indicated that the misreading of a clear rule is a highly unlikely candidate for relief. See Halicki v. Louisiana Casino Cruises, Inc., 151 F.3d 465, 470 (5th Cir.1998) ("Although ... we [leave] open the possibility that some misinterpretations of the federal rules may qualify as excusable neglect, such is the rare case indeed. Where, as here, the rule at issue is unambiguous, a district court's determination that the neglect was inexcusable is virtually unassailable."). But cf. Speiser, Krause & Madole P.C. v. Ortiz, 271 F.3d 884, 886 (9th Cir.2001) (interpreting Fed.R.Civ.P. 60(b)(1); "[w]hile an attorney's egregious failure to read and follow clear and unambiguous rules might sometimes be excusable neglect, mistakes construing the rules do not usually constitute excusable neglect." (internal quotation marks omitted)); In re Vitamins Antitrust Class Actions, 327 F.3d at 1209-1210 (applying Fed.R.Civ.P. 6(b) and 60(b)). In our view, defense counsel's misinterpretation of a readily accessible, unambiguous rule cannot be grounds for relief unless "[t]he word `excusable' [is to be] read out of the rule." Prizevoits, 76 F.3d at 134.
17
Accordingly, the district court abused its discretion in finding that the delay in filing was the result of excusable neglect. We therefore lack jurisdiction to hear Defendant's appeals. See Gooch, 493 F.2d at 368.
III. CONCLUSION
18
We DISMISS the appeals for lack of jurisdiction.
Notes:
1
"Good cause comes into play in situations in which there is not fault — excusable or otherwise. In such situations, the need for an extension is usually occasioned by something that is not within the control of the movant."Bishop v. Corsentino, No. 02-1485, 371 F.3d 1203, 1206-07 (10th Cir.2004) (internal quotation marks omitted). There is no claim of "good cause" here.
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