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NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court." Although it is posted on the
internet, this opinion is binding only on the parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-4847-17T3
STERIS CORPORATION,
Plaintiff-Appellant,
v.
DAVID SHANNON,
Defendant-Respondent.
___________________________
Argued April 2, 2019 – Decided June 10, 2019
Before Judges Fisher, Hoffman and Geiger.
On appeal from Superior Court of New Jersey,
Chancery Division, Camden County, Docket No. C-
000134-16.
David M. Walsh argued the cause for appellant
(Jackson Lewis, PC, attorneys; David M. Walsh, of
counsel and on the briefs; R. Shane Kagan, on the
briefs).
Alan H. Schorr argued the cause for respondent (Schorr
& Associates, PC, attorneys; Alan H. Schorr, on the
brief).
PER CURIAM
Plaintiff STERIS Corporation appeals from a Chancery Court order
granting summary judgment and dismissing its lawsuit against defendant David
Shannon, a former employee who began competing against plaintiff, allegedly
using legally protected client information owned by plaintiff. Plaintiff contests
the court's grant of summary judgment in favor of defendant on all counts of
plaintiff's complaint, arguing that genuine issues of material fact remain,
warranting a trial.
For the reasons that follow, we reverse and remand for trial.
I.
Plaintiff sells medical equipment and supplies. In 1999, General
Econopak, Inc. employed defendant as a sales consultant of medical supplies.
In July 2015, plaintiff acquired General Econopak, and on November 5, 2015,
plaintiff terminated defendant's employment.
When plaintiff terminated defendant, it asked him to return his "computer,
keys, garage door opener[,] and customer files." However, on the morning of
November 6, 2015, defendant informed Brad Smoyer, an employee of plaintiff,
that he "and his son and daughter stayed up all night and printed STERIS
documents from [defendant's] company-issued laptop computer. [Defendant]
explained they did this because he was aware he had to return his laptop to
A-4847-17T3
2
[plaintiff] the next day . . . ." At his deposition, Smoyer added that defendant
said he purchased two printers to complete this project.
The record also contains an affidavit by John Tozzi, a forensic computer
analyst, who examined defendant's company-issued laptop. According to Tozzi,
"on November 5, 2015, at 9:38 p.m., a PNY USB 2.0 device was attached to the
laptop for the first time, and was disconnected for the last time a few hours later
on November 6, 2015, at 2:38 a.m."
On December 21, 2015, plaintiff and defendant entered into a
"Confidential Separation Agreement and General Release" (the Agreement),
which provided that, in exchange for thirteen weeks of compensation, defendant
agreed to release plaintiff from all claims and liabilities. Defendant also agreed,
in relevant part, to "keep confidential and not divulge to any third party . . . any
confidential, proprietary, and/or trade secret information of STERIS, including,
without limitation, information regarding STERIS's practices, policies, financial
data, . . . and customers . . . ." Defendant "further agree[d] to not use any
confidential, proprietary, and/or trade secret information of STERIS to
[defendant's] own or another's benefit." Defendant was also to "return to
STERIS any and all STERIS equipment and property of any kind whatsoever
A-4847-17T3
3
that [defendant] may have in [his] possession." The Agreement did not include
a non-compete clause.
On February 24, 2016, defendant entered into a "mutual nondisclosure
agreement" with Technipaq, Inc., one of plaintiff's main competitors. By May
2016, defendant had started his own company, Shannon Aseptic Consulting,
LLC, (Shannon Aseptic) which entered into an "independent sales contractor
role" with Technipaq.
On October 17, 2017, plaintiff filed a verified complaint, alleging that
defendant "was contacting and soliciting certain STERIS' customers on behalf
of Shannon Aseptic," and "[t]he solicitations included contacts that were not
associated with [defendant]'s former accounts." The complaint asserted that
defendant "could not have obtained the identities and contact information for
[these] solicitations . . . but for his possession of . . . STERIS' confidential
contact and other proprietary information."
According to Julia Madsen, a vice president and general manager for
plaintiff, defendant "was using the knowledge from the [Act] [D]ata[]base as
well as the financial data base to pursue" plaintiff's customers, in violation of
A-4847-17T3
4
the severance agreement. The Act Database1 is a "sophisticated customer
relationship management software" that contains "contact information, . . . sales
activities, pipeline, opportunities, history, proprietary documents, secondary
contact information, relationship information, personal customer information,
engagements, and timelines, all related to [plaintiff]'s customers and sales
activities." Madsen related that defendant also used "sales report[s] that he had
access to which would include all of the customers, where they're located, what
they buy, and what they pay and the quantity that they purchase globally";
defendant received a printed version of plaintiff's sales reports on a monthly
basis when he worked for plaintiff.
A forensic computer analyst provided the parties with a confidential report
comparing plaintiff and Shannon Aseptic's Act Databases. The report stated that
plaintiff's Act Database contained 17,400 entries, or contacts, while Shannon
Aseptic's Act Database had 5550 entries. Of these entries, it is undisputed that
approximately 1750 of the entries were duplicates, containing the exact same
companies, contact names, addresses, email addresses, and even the same
typographical errors or inaccurate use of all caps or all lowercase. At his
1
The record frequently refers to the program as the "Act!" or "ACT!" database
– for purposes of this opinion we refer to the program as the "Act Database."
A-4847-17T3
5
deposition, defendant admitted that he synchronized his cell phone with
plaintiff's Act Database to the extent of names, telephone numbers, addresses,
and email addresses, and he transferred this information from his cell phone into
his new company's Act Database.
Madsen further testified that Technipaq acquired a former client of
plaintiff's, "Baxter," which previously generated $800,000 in annual revenue for
plaintiff. Another salesperson of plaintiff had the Baxter account, but defendant
was the salesperson's manager. Madsen testified that defendant solicited
business from other customers of plaintiff, specifically "BPL in UK" and
"Central Biomedia," which were not connected with defendant when he worked
for plaintiff. The record also contains an email from defendant to an individual
from "Hospira/Pfizer," a contact of plaintiff, attempting to solicit business.
As to the Central Biomedia account, the record includes a July 26, 2016
price quote from Technipaq and Shannon Aseptic. The quote was attached to
an email between plaintiff's employees, which reads that defendant personally
"visited" an employee from Central Biomedia, who provided the information to
plaintiff. Defendant told the Central Biomedia employee that "he can get the
same materials [plaintiff] currently provide[s] at a lower price," and that
defendant "also promised lead times to be much shorter . . . ."
A-4847-17T3
6
Defendant may have solicited or acquired business from other companies
that were consumers of plaintiff, but the record is lacking in part because on
March 16, 2018, the trial court denied plaintiff's order to compel discovery,
which sought to have defendant "identify any and all known current or former
customers of [p]laintiff to whom [d]efendant sold competing product since
November 4, 2015 . . . ."
The record also lacks a significant amount of defendant's computer history
during relevant periods. Defendant certified that between September and
December 2015, he "was temporarily using a . . . laptop that used to be [his]
son's computer," which he claimed was "antiquated and worthless and we threw
it away when we got . . . new computers in May." A forensic computer analyst
wrote a report on five computers turned over by defendant, but he found that
new operating systems were installed; the analyst explained, "The USB history
reports only show the USB activity for the time period AFTER the current
[operating system] was installed – any activity that predated the installation was
purged from the computer's memory as part of the installation . . . ." Defendant
certified he "installed the Windows 10 upgrade on all of the computers . . . .
because Windows 10 offered greater security and a free upgrade."
A-4847-17T3
7
Plaintiff's verified complaint set forth the following causes of action: (1)
breach of the severance agreement; (2) breach of implied covenant of good faith
and fair dealing; (3) misappropriation of confidential and proprietary
information; (4) violation of the New Jersey Trade Secrets Act, N.J.S.A. 56:15-
1; (5) violation of the New Jersey Computer Related Offenses Act, N.J.S.A.
2A:38A; (6) unjust enrichment; and (7) unfair competition. Plaintiff sought to
enjoin defendant "from destroying, using, revealing, copying, or disseminating
. . . any information concerning [plaintiff's] business, including but not limited
to . . . [plaintiff's] confidential, proprietary, and trade secret information." 2
Plaintiff also sought compensatory and punitive damages.
After a trial date was set, defendant moved for summary judgment. Following
oral argument, the trial judge granted defendant's motion on all counts, and entered
an order dismissing plaintiff's complaint. The judge reasoned:
[W]hatever was contained in the database of [plaintiff] is
not really protected information, . . . . it's names, addresses,
and phone numbers of customers who -- all of whom are
well known in the industry and all of whom can be
contacted and be seen as . . . potential customer[s] for any
company. Anybody who is -- even a startup business.
2
Within thirty days of the filing of plaintiff's complaint, the court entered a
consent order granting plaintiff the injunctive relief sought in its complaint.
A-4847-17T3
8
While the judge noted a potential issue of fact as to whether "defendant downloaded
the database information from [plaintiff]'s computer," and withheld boxes of
plaintiff's documents after his termination, the judge found these factual issues
immaterial, concluding the information was not protected as confidential,
proprietary, or trade secret information. This appeal ensued.
II.
We review a grant of summary judgment under the same standard that governs
the trial court. Henry v. N.J. Dep't of Human Servs., 204 N.J. 320, 330 (2010).
Summary judgment must be granted if "the pleadings, depositions, answers to
interrogatories and admissions on file, together with affidavits, if any, show that
there is no genuine issue as to any material fact challenged and that the moving party
is entitled to a judgment or order as a matter of law." R. 4:46-2(c). There is a
genuine issue of material fact precluding summary judgment when "the competent
evidential materials presented, when viewed in the light most favorable to the non-
moving party, are sufficient to permit a rational factfinder to resolve the alleged
disputed issue in favor of the non-moving party." Brill v. Guardian Life Ins. Co. of
Am., 142 N.J. 520, 540 (1995).
Here, the severance agreement between the parties explicitly states that
defendant was not to retain or use "confidential, proprietary and/or trade secret
A-4847-17T3
9
information of [plaintiff], including, without limitation information regarding
[plaintiff]'s practices . . . financial data . . . and customers . . . ." (emphasis
added). While "customers" is listed in the contract as a trade secret, and the trial
judge observed there is a potential issue of fact as to whether defendant stole
1750 consumer and contact entries from plaintiff's Act Database, she ruled for
defendant by finding the database information "is not really protected
information." Since defendant himself conceded that he synchronized contacts
from plaintiff's Act Database, and then transferred them into Shannon Aseptic's
Act Database, the issue is whether the information taken was legally protected.
To be legally protectable, information need not rise to the level of a trade
secret and may otherwise be publicly available. Lamorte Burns & Co. v.
Walters, 167 N.J. 285, 299 (2001). The key to determining the misuse of
information is the relationship of the parties at the time of disclosure and the
intended use of the information, ibid.; however, matters of general knowledge
within an industry may not be classified as confidential. Whitmyer Bros., Inc.
v. Doyle, 58 N.J. 25, 33-34 (1971).
Customer lists can be considered confidential and subject to protection.
"In all instances, a substantial measure of secrecy must exist in order for
information to be treated as a trade secret." Lamorte Burns, 167 N.J. at 299.
A-4847-17T3
10
The Supreme Court enumerated six factors to consider in determining whether
information, such as the customer data in question, constitutes a trade secret:
(1) the extent to which the information is known outside
of the business; (2) the extent to which it is known by
employees and others involved in the business; (3) the
extent of measures taken by the owner to guard the
secrecy of the information; (4) the value of the
information to the business and to its competitors; (5)
the amount of effort or money expended in developing
the information; and (6) the ease or difficulty with
which the information could be properly acquired or
duplicated by others.
[Ingersoll-Rand Co. v. Ciavatta, 110 N.J. 609, 637
(1988) (citing Restatement of Torts § 757 cmt. b (1939)
(Am. Law Inst., amended 1979)); see also Hammock by
Hammock v. Hoffmann-Laroche, 142 N.J. 356, 384
(1995).]
In Lamorte Burns, the court reaffirmed these principles, 167 N.J. at 298-
99, and applied them to the facts and holdings of Platinum [Mgmt.], Inc. v.
Dahms, 285 N.J. Super. 274, 295 (Law Div. 1995):
In Platinum, [the] plaintiff sued its former employee for
breach of the duty of loyalty, claiming that [the
defendant] discussed its customers with his new
employer. [The d]efendant argued that the information
was not protectable because it was publicly available.
Ibid. The court disagreed, and found that the
information the plaintiff sought to protect went beyond
mere names, but also included buying habits, mark-up
structure, merchandising plans, projections, and
product strategies. Ibid. The court stated that the
customer's names may have been listed in readily
A-4847-17T3
11
obtainable trade directories, but the fact that they were
the plaintiff's customers was not. Ibid. The court
concluded that the identity of the customers is "entitled
to protection when divulged in confidence to a key
employee . . . where [the defendant] is a party to a
covenant not to compete." Ibid.
[Lamorte Burns, 167 N.J. at 298-300.]
Here, it is undisputed that defendant was never bound by a covenant not to
compete. However, Lamorte Burns involved two former employee defendants –
only one of whom was subject to a non-compete – that left the plaintiff company to
establish a new business and compete directly against it. Id. at 291-93. The
defendants developed a targeted solicitation list based on information from the
plaintiff's client files. Ibid. The Court disagreed with our "conclusion that a trial
[was] needed to determine whether the information secretly gathered by defendants
was legally protected," id. at 301, and instead held that the plaintiff was "entitled to
summary judgment on its . . . claims . . . that [both of the] defendants misappropriated
[the] plaintiff's confidential and proprietary information and committed unfair
competition." Id. at 309.
In concluding the information the defendants took from plaintiff was legally
protected, the Court found:
The information surreptitiously gathered by [the]
defendants from [the] plaintiff was not generally
available to the public, but was shared between plaintiff
A-4847-17T3
12
and its clients. [The d]efendants would not have been
aware of that information but for their employment.
The information went beyond the mere names of
plaintiff's clients. It included specific information
concerning the clients' claims . . . . [The d]efendants
admitted that that information gave them an advantage
in soliciting [the] plaintiff's clients once they resigned.
But, the information was available to [the] defendants
for their use in servicing clients on behalf of [the
plaintiff] only.
The record is clear that [the] defendants also knew that
[the plaintiff] had an interest in protecting that
information. [One of the defendants] signed an
agreement that so stated, and both . . . declined to sign
a later agreement that sought to afford further
protection to the information. [One defendant]
acknowledged that he would not have given such
information to a competitor if requested, and he would
not have permitted a[n] employee [of plaintiff] to do so.
Also, [the defendants] both were aware that [a] co-
employee . . . had been fired because of his attempt to
privately solicit Lamorte's customers.
[Id. at 301-02.]
Here, viewing the evidence in the light most favorable to plaintiff, there
remains a genuine issue of material fact as to whether the information gathered
by defendant was legally protected. There is sufficient evidence for a rational
factfinder to conclude that the 1750 duplicate contact entries between the parties'
Act Databases were trade secrets owned by plaintiff, which were surreptitiously
taken and used by defendant. While it is plausible that the names of the
A-4847-17T3
13
companies, their key contact employees' names, email addresses, and phone
numbers could be collected from the industry's directories and LinkedIn, as
defendant contends, we disagree that this vast collection of information should
be considered, as a matter of law, "readily ascertainable," N.J.S.A. 56:15-2, or
easily duplicated, Ingersoll-Rand Co., 110 N.J. at 637. Evidence in the record
also suggests that the Act Database contains plaintiff's history with the listed
contacts, such as "sales activities, pipeline, [and] opportunities."
Plaintiff made efforts to protect the information at issue from defendant:
it took his company computer back the day after his termination; it sought to
collect all paper documents from his home; and in the severance agreement, it
secured defendant's agreement to "return to [plaintiff] any and all [of plaintiff's]
equipment and property of any kind whatsoever that [defendant] may have in
[his] possession." Lastly, defendant agreed to "keep confidential," "not
divulge," and "not use any confidential, proprietary, and/or trade secret
information of STERIS to [his] own or another's benefit." The record reflects
genuine issues of material fact as to whether defendant breached these parts of
the agreement.
The record also contains evidence that defendant actively sought to attain
proprietary information owned by plaintiff upon his termination, and took steps
A-4847-17T3
14
to cover his tracks in the process. The night of his termination, defendant
allegedly bought two printers and stayed up all night with his son and daughter,
printing documents from his company-issued laptop. The forensic computer
analyst's report supports this allegation, indicating that a USB drive was inserted
into that computer for the first time on November 5, 2015, at 9:38 p.m., and
remained connected until 2:38 a.m. the next morning. The record also reveals
that defendant threw away the computer he used for several relevant months,
and then purged his new computers' histories when he installed new operating
systems in them.
Considering "the relationship of the parties . . . and the intended use of the
information," Lamorte, 167 N.J. at 299 (citing Platinum Mgmt., 285 N.J. Super.
at 295), plaintiff terminated defendant, who agreed to not use plaintiff's
proprietary or trade secrets information. Defendant also agreed to return any
such property to plaintiff. The record contains evidence, sufficient to survive
summary judgment, that defendant used this information with the intent to take
business from plaintiff by reaching out to plaintiff's key contacts within these
client companies, and offered the same products for lower prices and faster
service than what plaintiff was providing to them. Since defendant did not
actively work with these clients while employed by plaintiff, a rational
A-4847-17T3
15
factfinder could conclude that he used plaintiff's proprietary or trade secret
information in these solicitations. Moreover, while the record includes one
client taken from plaintiff in Baxter, and three of plaintiff's clients solicited by
defendant in "BPL in UK," "Central Biomedia," and "Hospira/Pfizer," more
clients might have been discovered had the trial court granted plaintiff's motion
to compel discovery on this matter.
Viewed in a light most favorable to plaintiff, the evidence in the record
raises genuine issues of material fact as to whether defendant misappropriated
legally protected information or trade secrets owned by plaintiff, whether this
was in breach of the severance agreement, and whether defendant's conduct
constituted unfair competition. We therefore reverse the order granting the
summary judgment dismissal of plaintiff's complaint and remand the case for
trial.
Reversed and remanded. We do not retain jurisdiction.
A-4847-17T3
16
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Case: 18-50225 Document: 00515173123 Page: 1 Date Filed: 10/24/2019
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
FILED
No. 18-50225 October 24, 2019
Lyle W. Cayce
UNITED STATES OF AMERICA, Clerk
Plaintiff-Appellee,
v.
TONY SPARKS,
Defendant-Appellant.
Appeal from the United States District Court
for the Western District of Texas
Before ELROD, GRAVES, and OLDHAM, Circuit Judges. *
ANDREW S. OLDHAM, Circuit Judge:
Tony Sparks and his fellow gang members carjacked Todd and Stacie
Bagley at gunpoint. The gang locked the Bagleys in the trunk for hours,
emptied the Bagleys’ bank account, and tried to pawn Stacie’s wedding ring.
During the gang’s crime spree, the Bagleys sang gospel songs from the trunk
and told their captors about Jesus. Eventually one of the gang members popped
the trunk, cursed at the couple, and executed Todd in front of his wife. That
same gang member shot Stacie in the face but failed to kill her. Others
incinerated the car to destroy the evidence and burned Stacie alive.
* Judge Graves concurs in the judgment only.
Case: 18-50225 Document: 00515173123 Page: 2 Date Filed: 10/24/2019
No. 18-50225
For his role in this crime, Sparks received a below-Guidelines 35-year
sentence. Sparks says that violates the Eighth Amendment. We disagree.
I.
A.
On June 20, 1999, Tony Sparks went to a convenience store in Killeen,
Texas, with Christopher Vialva and Christopher Lewis. 1 The three of them
were members of a local gang known as the 212 PIRU Bloods. They planned to
dupe a Good Samaritan into giving them a ride before carjacking him or her at
gunpoint. Sparks brought the gun, a .22 caliber pistol.
Police initially thwarted the plan by detaining the trio for violating the
city’s juvenile curfew law. (Sparks was 16 at the time.) Before being detained,
Lewis threw the pistol into the bushes. Sparks’s mother picked up Sparks and
Lewis, and Vialva was released because he was an adult.
The following day, Sparks, Vialva, and Lewis regrouped. They recruited
two other members of their gang, Brandon Bernard and Terry Brown, to help
with the carjacking. Vialva and Bernard retrieved the .22 caliber pistol that
Lewis had discarded the night before. Because it was wet with dew, they
worried that it would not function. So Bernard obtained a Glock .40 caliber
pistol to use for the carjacking.
That afternoon, the five gang members went to an IGA supermarket to
find a carjacking victim. Bernard and Brown acted as lookouts while Sparks,
Vialva, and Lewis approached potential victims to ask for a ride. No one offered
them a ride, so they drove to a “Mickey’s” convenience store. Bernard and
Brown went to a nearby laundromat to play video games. Sparks, Vialva, and
Lewis went to the front of the convenience store.
1We previously reported the factual background of this case in United States v.
Bernard, 299 F.3d 467 (5th Cir. 2002). The factual recitation here comes principally from
Bernard, as supplemented by Sparks’s record.
2
Case: 18-50225 Document: 00515173123 Page: 3 Date Filed: 10/24/2019
No. 18-50225
Shortly after arriving at the convenience store, Sparks found Todd
Bagley using a payphone outside. Todd and his wife Stacie were youth
ministers from Iowa. They’d previously lived in Killeen because Todd was a
veteran of the U.S. Army and had been stationed at Fort Hood. The young
couple had gone to church at Grace Christian, where they worked with the
youth group. They were back in Killeen on a vacation to see old friends and
attend a revival meeting at the church.
Sparks approached Todd and asked if he would give Sparks, Vialva, and
Lewis a ride to another location. Todd conferred with Stacie, and the young
couple unsuspectingly agreed to give the gang members a ride. Bernard and
Brown returned to their homes to wait for further instructions from Vialva.
Sparks, Vialva, and Lewis got into the back seat of the Bagleys’ car. Todd
drove while his wife sat in the front passenger seat. In accordance with their
plan, Sparks and Vialva pulled out two handguns, and Vialva pointed his gun
at Todd. Vialva told the Bagleys that the “plan had changed,” and he forced
Todd to drive to a semi-rural location near the edge of Killeen. While Vialva
pointed a gun at the Bagleys, Sparks and Vialva robbed them of their money,
wallets, purse, debit card, identification, and jewelry. Vialva demanded their
bank account’s pin number and then forced the Bagleys into the trunk of their
car.
With the Bagleys locked in the trunk, Sparks, Vialva, and Lewis went on
an hours-long crime spree. They went to an ATM to steal all of the Bagleys’
money. That effort was frustrated, however, because the youth ministers had
less than $100 in their bank account. They tried to pawn Stacie’s wedding ring.
They used what little money they could steal from the Bagleys to buy cigars,
cigarettes, and fast food from Wendy’s.
Meanwhile, the Bagleys evangelized from the trunk. According to Lewis
(who later testified), the Bagleys asked him and Sparks about God, Jesus, and
3
Case: 18-50225 Document: 00515173123 Page: 4 Date Filed: 10/24/2019
No. 18-50225
church. The Bagleys acknowledged not having earthly wealth, but they told
their captors that faith in Jesus is more valuable than money. The Bagleys
talked about the revival meeting at Grace Christian. And the Bagleys urged
their captors to have faith in Jesus Christ. The Bagleys begged for their lives.
As night began to fall, Sparks told the gang that he needed to go home
to avoid violating his 8 p.m. probation curfew for a previous robbery conviction.
The group dropped Sparks off at his home. Sparks took the Bagleys’ jewelry
with him. But Vialva asked Sparks not to take his .22 caliber handgun. After
initially refusing, Sparks agreed.
Bernard and Brown purchased fuel to burn the Bagleys’ car. Vialva and
Lewis picked them up, and the four gang members drove (again, with the
Bagleys still locked in the trunk) to the Belton Lake Recreation Area on the
Fort Hood military installation. Vialva parked the Bagleys’ car on top of a little
hill. Brown and Bernard poured lighter fluid on the interior of the car. All the
while, the Bagleys sang and prayed in the trunk.
Stacie’s last words were “Jesus loves you,” and “Jesus, take care of us.”
Vialva crudely cursed at her, told Lewis to pop the trunk, and then executed
Todd in front of his wife. Vialva shot Todd in the head with the .40 caliber
Glock, killing him instantly. Then Vialva shot Stacie in the face but failed to
kill her. Bernard set the car on fire and burned Stacie alive. Todd was 26.
Stacie was 28.
B.
Sparks pleaded guilty to aiding and abetting a carjacking, and he hoped
to receive an offense-level reduction for acceptance of responsibility. U.S.S.G.
§ 3E1.1. But as he was awaiting sentencing, Sparks was implicated in a plot to
escape from his detention center. As Sparks himself acknowledges, another
inmate, Christopher Kirvin, choked a prison guard unconscious and stole her
keys. The Pre-Sentence Report (“PSR”) implicated Sparks based on a witness
4
Case: 18-50225 Document: 00515173123 Page: 5 Date Filed: 10/24/2019
No. 18-50225
who heard Sparks planning the escape attempt with Kirvin. Sparks flushed a
toilet repeatedly during the assault to mask the sound of the prison guard’s
screams. Based on the escape attempt, the PSR added two points to Sparks’s
offense level for obstructing justice. Id. § 3C1.1. It also denied Sparks an
offense-level reduction for accepting responsibility. Id. § 3E1.1. Given the
nature of the crime and the Bagleys’ murders, the PSR recommended an
offense level of 45—two levels above the highest value on the sentencing table.
When the district court sentenced Sparks in 2001, it agreed with the
PSR’s factual findings and sentencing calculation. Applying the Guidelines,
which were mandatory before United States v. Booker, 543 U.S. 220 (2005), the
court sentenced Sparks to life in prison without the possibility of parole
(“LWOP”).
We affirmed Sparks’s sentence on direct appeal. See United States v.
Sparks, 31 F. App’x 156 (5th Cir. 2001). In 2003, Sparks filed a pro se motion
under 28 U.S.C. § 2255 to vacate his sentence, and the district court denied it.
Sparks filed an appeal, but we dismissed it for want of prosecution. United
States v. Sparks, No. 03-50781 (5th Cir. Nov. 19, 2003).
Since then, several Supreme Court decisions involving the Eighth
Amendment raised constitutional concerns about Sparks’s LWOP sentence. In
Graham v. Florida, 560 U.S. 48 (2010), the Court held that juveniles may not
be sentenced to life without parole for non-homicide offenses. In Miller v.
Alabama, 567 U.S. 460 (2012), the Court held that juveniles may not receive
mandatory sentences of life without parole. And in Montgomery v. Louisiana,
136 S. Ct. 718 (2016), the Court made Miller retroactive to cases on collateral
review.
We authorized Sparks to file a successive § 2255 motion based on
Graham. In re Sparks, 657 F.3d 258, 262 (5th Cir. 2011). The district court
denied the motion. But we granted a certificate of appealability, United States
5
Case: 18-50225 Document: 00515173123 Page: 6 Date Filed: 10/24/2019
No. 18-50225
v. Sparks, No. 13-50807 (5th Cir. July 10, 2014), and remanded the case for
reconsideration at the Government’s request, United States v. Sparks, No. 13-
50807 (5th Cir. Feb. 10, 2015). We also authorized Sparks to file a successive
§ 2255 motion based on Miller, which the Government did not oppose. In re
Sparks, No. 16-50973 (5th Cir. Nov. 18, 2016).
Upon joint motion of the parties, the district court consolidated the
motions and ordered a resentencing. It provided Sparks with court-appointed
experts and conducted a five-day sentencing hearing. At the hearing, the
Government introduced evidence that Sparks committed repeated acts of brutal
violence during his first decade in prison. In 2004, Sparks participated in a riot
involving approximately 600 inmates, carrying a baseball bat during the
fighting. In July 2006, Sparks stabbed his cellmate 12 times in the back, neck,
head, and right arm. In September 2007, he stabbed another inmate in the
neck, resulting in a spinal cord injury that left the inmate unable to walk or
urinate by himself. In March 2008, Sparks attempted to murder an inmate by
stabbing him repeatedly in the head, resulting in brain damage and the loss of
the victim’s right eye. Sparks’s violence led to his transfer to ADX Florence in
Colorado, a supermax facility where the nation’s most dangerous federal
prisoners are located. Before that transfer, he had been sanctioned for at least
23 incidents. And in 2014, Sparks instructed two inmates to assault another
inmate.
The district court carefully examined Sparks’s youth and its attendant
characteristics in a twenty-six-page memorandum opinion. The district court
included a thorough discussion of Miller and the 18 U.S.C. § 3553(a) factors.
The court also considered the PSR, which could not identify any basis under
§ 3553(a) for varying from the recommended sentence of life imprisonment.
The district court could not “imagine a worse offense, nor [could] the court
imagine a more callous perpetrator than the defendant.” Nonetheless, the
6
Case: 18-50225 Document: 00515173123 Page: 7 Date Filed: 10/24/2019
No. 18-50225
district court chose to vary downward and sentenced Sparks to 35 years, with
credit for time in custody. Sparks appealed.
II.
Sparks’s principal argument on appeal is that the district court violated
Miller v. Alabama. That case held the Eighth Amendment prohibits mandatory
LWOP sentences for juveniles. Miller, 567 U.S. at 465. It’s not clear from
Sparks’s briefs whether he thinks his below-Guidelines sentence violates the
substantive or procedural aspects of the Miller decision. At argument, his
counsel urged us to consider both. We do so.
A.
Miller announced a substantive Eight Amendment rule: The
Constitution prohibits sentencing a juvenile to mandatory LWOP because it
“poses too great a risk of disproportionate punishment.” 567 U.S. at 479. But
Miller did “not consider” whether “the Eighth Amendment requires a
categorical bar on life without parole for juveniles.” Ibid.
Three corollaries follow from Miller’s substantive rule. First, it “did not
foreclose a sentencer’s ability to impose life without parole” on a discretionary
basis. Montgomery, 136 S. Ct. at 726; see also Miller, 567 U.S. at 483. Our sister
circuits’ post-Miller decisions recognize as much. See Contreras v. Davis, 716 F.
App’x 160, 163 (4th Cir. 2017); Kelly v. Brown, 851 F.3d 686, 687–88 (7th Cir.
2017); United States v. Jefferson, 816 F.3d 1016, 1019 (8th Cir. 2016); Davis v.
McCollum, 798 F.3d 1317, 1320–21 (10th Cir. 2015); Croft v. Williams, 773 F.3d
170, 171 (7th Cir. 2014); Evans-Garcia v. United States, 744 F.3d 235, 241 (1st
Cir. 2014); Bell v. Uribe, 748 F.3d 857, 869–70 (9th Cir. 2014); United States v.
Reingold, 731 F.3d 204, 214 (2d Cir. 2013). 2 Numerous state courts have reached
2The Fourth Circuit in Malvo v. Mathena, 893 F.3d 265 (4th Cir. 2018), held that
Montgomery expanded Miller to cover discretionary LWOP sentences. Id. at 273–74. The
Supreme Court granted certiorari. 139 S. Ct. 1317 (2019) (mem.).
7
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No. 18-50225
the same conclusion. See, e.g., Lucero v. People, 394 P.3d 1128, 1132 (Colo. 2017);
Conley v. State, 972 N.E.2d 864, 879 (Ind. 2012); State v. Russell, 908 N.W.2d
669, 676 (Neb. 2018); Jones v. Commonwealth, 795 S.E.2d 705, 722 (Va. 2017).
Thus, if a sentencing court has the option to choose a sentence other than life
without parole, it can choose life without parole without violating Miller.
Second, Miller has no relevance to sentences less than LWOP. See United
States v. Walton, 537 F. App’x 430, 437 (5th Cir. 2013) (per curiam). This means
that sentences of life with the possibility of parole or early release do not
implicate Miller. See Bowling v. Dir., Va. Dep’t of Corr., 920 F.3d 192, 197 (4th
Cir. 2019); Goins v. Smith, 556 F. App’x 434, 440 (6th Cir. 2014); Lucero, 394
P.3d at 1132; Lewis v. State, 428 S.W.3d 860, 863–64 (Tex. Crim. App. 2014).
Nor do sentences to a term of years. See Walton, 537 F. App’x at 437; United
States v. Morgan, 727 F. App’x 994, 997 (11th Cir. 2018) (per curiam); United
States v. Lopez, 860 F.3d 201, 211 (4th Cir. 2017); Lucero, 394 P.3d at 1133. All
of these sentences can be imposed on a mandatory basis for juveniles without
implicating Miller because they are not LWOP sentences.
Third, a term-of-years sentence cannot be characterized as a de facto life
sentence. Miller dealt with a statute that specifically imposed a mandatory
sentence of life. The Court distinguished that sentencing scheme from
“impliedly constitutional alternatives whereby ‘a judge or jury could choose,
rather than a life-without-parole sentence, a lifetime prison term with the
possibility of parole or a lengthy term of years.’ ” Lucero, 394 P.3d at 1133
(quoting Miller, 567 U.S. at 489). Given Miller’s endorsement of “a lengthy
term of years” as a constitutional alternative to life without parole, it would be
bizarre to read Miller as somehow foreclosing such sentences.
A panel of the Third Circuit nevertheless tried. See United States v.
Grant, 887 F.3d 131 (3d Cir. 2018), reh’g en banc granted, opinion vacated, 905
F.3d 258 (3d Cir. 2018). In Grant, the panel sought to “effectuate” Miller by
8
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No. 18-50225
inventing a “rebuttable presumption” that a juvenile offender “should be
afforded an opportunity for release before the national age of retirement.” Id.
at 152–53. The panel conceded it had no “principled basis” for drawing that
line. Id. at 150. The panel further conceded it couldn’t be sure what line it was
drawing: “We cannot say with certainty what the precise national age of
retirement is, as it is a figure that incrementally fluctuates over time.” Id. at
151. It also admitted that reliance on a “national retirement age” would fail to
account for “locality, state, gender, race, wealth, or other differentiating
characteristics.” Ibid. The panel went on to discuss the history of Social
Security, Gallup polls, and one academic study before pronouncing a “national
retirement age” of sixty-five. Id. at 151–52. But even in its pronouncement of
the rule, the panel appeared to recognize the arbitrariness of its decision:
“Without definitively determining the issue, we consider sixty-five as an
adequate approximation of the national age of retirement to date. However,
district courts retain the discretion to determine the national age of retirement
at sentencing, and remain free to consider evidence of the evolving nature of
this estimate.” Id. at 152. Such reasoning is not bound by law.
Sparks cannot show a substantive Miller violation. First, he received a
discretionary sentence under § 3553(a) rather than a mandatory sentence.
Second, he was sentenced to thirty-five years in prison rather than life without
parole. Because Sparks did not receive a mandatory sentence of life without
9
Case: 18-50225 Document: 00515173123 Page: 10 Date Filed: 10/24/2019
No. 18-50225
parole, he has failed to demonstrate a violation of Miller’s substantive
requirements. 3
B.
The procedural component of Miller “requires a sentencer to consider a
juvenile offender’s youth and attendant characteristics before determining
that life without parole is a proportionate sentence.” Montgomery, 136 S. Ct.
at 734. In Miller and Montgomery, the Supreme Court considered state laws in
Alabama and Louisiana imposing mandatory LWOP sentences on juveniles.
But federal prisoners have procedural protections that state prisoners do not
have—namely, the sentencing factors in § 3553(a) and the advisory Sentencing
Guidelines.
Under § 3553(a), a sentencing court “shall impose a sentence sufficient,
but not greater than necessary, to comply with the purposes” of sentencing. In
choosing an appropriate sentence, the court must examine “the nature and
circumstances of the offense and the history and characteristics of the
defendant.” 18 U.S.C. § 3553(a)(1). It must also consider the policy statements
of the Sentencing Commission, id. § 3553(a)(5), which expressly allow for
consideration of the defendant’s age, “including youth,” U.S.S.G. § 5H1.1, p.s.
The § 3553(a) analysis satisfies Miller’s procedural requirement that the
court consider the defendant’s youth and its attendant characteristics before
imposing a sentence of life without parole. See Moore v. United States, 871 F.3d
72, 79 (1st Cir. 2017); Lopez, 860 F.3d at 211; Jefferson, 816 F.3d at 1018 n.3
3 It is unclear whether Sparks also intended to challenge the substantive
reasonableness of his sentence under Gall v. United States, 552 U.S. 38 (2007). The issue is
not adequately briefed, but even if it were, Sparks has failed to show an abuse of discretion.
Id. at 51. Sparks has a remarkable history of violence in prison. Even so, the district court
varied down from the Guidelines, sentencing him to 35 years. Sparks has not rebutted the
presumption that his below-Guidelines sentence is reasonable. See United States v. Simpson,
796 F.3d 548, 557 (5th Cir. 2015).
10
Case: 18-50225 Document: 00515173123 Page: 11 Date Filed: 10/24/2019
No. 18-50225
(noting that the “Supreme Court has not yet applied its constitutional decision
in Miller to a life sentence imposed by a federal court,” and questioning Miller’s
applicability to a sentence imposed under the advisory Guidelines). Thus, a
sentence that satisfies § 3553(a)’s procedural requirements cannot be
challenged under the procedural component of the Miller decision.
Reflecting some confusion over the procedural requirements of Miller, the
district court’s opinion contains separate discussions of Miller and § 3553(a).
Other courts have similarly treated the so-called “Miller factors” as separate
from the § 3553(a) factors. See, e.g., United States v. Orsinger, 698 F. App’x 527,
527 (9th Cir. 2017) (per curiam) (noting that the district court considered the
evidence in “light of the factors identified in Miller and in 18 U.S.C. § 3553(a)”);
United States v. Garcia, 666 F. App’x 74, 78 (2d Cir. 2016) (per curiam) (referring
to “Miller and § 3553(a) factors” as separate and distinct); United States v.
Guzman, 664 F. App’x 120, 122 (2d Cir. 2016) (per curiam) (noting that the
district court “gave ample consideration to each of the Miller factors, together
with the sometimes-overlapping § 3553(a) factors”); United States v. Guerrero,
560 F. App’x 110, 112 (2d Cir. 2014) (per curiam) (holding that the “district court
properly considered all of the Miller factors . . . and other mitigating factors
under 18 U.S.C. § 3553(a)”), aff’g United States v. Maldonado, No. 09-CR-339-
02, 2012 WL 5878673, at *9 (S.D.N.Y. Nov. 21, 2012) (discussing “Miller factors”
separately from § 3553(a) factors).
In a recent en banc opinion, the Ninth Circuit vacated a sentence imposed
under § 3553(a) after hearing “evidence related to a number of the Miller
factors” because the district court’s “sentencing remarks focused on the
punishment warranted by the terrible crime Briones participated in, rather
than whether Briones was irredeemable.” United States v. Briones, 929 F.3d
1057, 1066 (9th Cir. 2019) (en banc). Though the Ninth Circuit claimed not to
hold that “the district court erred simply by failing to use any specific words,”
11
Case: 18-50225 Document: 00515173123 Page: 12 Date Filed: 10/24/2019
No. 18-50225
id. at 1067, that appears to be exactly what the court did, see id. at 1073
(Bennett, J., dissenting). We reject the view that a procedurally proper sentence
imposed under § 3553(a) can be vacated merely because the district court failed
to quote certain magic words from the Supreme Court’s Miller decision. As the
Court has clearly said, “Miller did not require trial courts to make a finding of
fact regarding a child’s incorrigibility.” Montgomery, 136 S. Ct. at 735. The Court
was “careful to limit the scope of any attendant procedural requirement to avoid
intruding more than necessary upon the States’ sovereign administration of
their criminal justice systems.” Ibid. Hence, the Court reiterated, “Miller did not
impose a formal factfinding requirement.” Ibid.
In this case, the district court appointed taxpayer-funded experts for
Sparks, held a lengthy five-day hearing, and wrote twenty-six pages explaining
its sentence. This fulsome process gave Sparks far more than the minimum
procedure necessary to conduct a proper § 3553(a) analysis. And we agree with
the Government that Miller does not add procedural requirements over and
above § 3553(a).
III.
Sparks also argues that the district court erred in calculating the offense
level under the Guidelines. The district court increased Sparks’s offense level
by two points for obstructing justice, U.S.S.G. § 3C1.1, and denied him a two-
point reduction for accepting responsibility, id. § 3E1.1. Those decisions were
based on the court’s finding that Sparks attempted to escape from his detention
center. Sparks claims he was not involved in the attempt.
We review the district court’s factual findings for abuse of discretion,
which occurs when the court relies on “clearly erroneous facts.” Gall, 552 U.S.
at 51. “Generally, a PSR ‘bears sufficient indicia of reliability to be considered
as evidence by the sentencing judge in making factual determinations.’” United
States v. Harris, 702 F.3d 226, 230 (5th Cir. 2012) (quoting United States v.
12
Case: 18-50225 Document: 00515173123 Page: 13 Date Filed: 10/24/2019
No. 18-50225
Nava, 624 F.3d 226, 231 (5th Cir. 2010)). A district court may adopt facts
contained in the PSR “without further inquiry” if those facts have an “adequate
evidentiary basis with sufficient indicia of reliability.” Ibid. (quoting United
States v. Trujillo, 502 F.3d 353, 357 (5th Cir. 2007)).
Sparks’s PSR contains reliable evidence that he tried to escape from his
detention center. That evidence includes an interview with a witness who
heard Sparks discussing the escape plan with another inmate, Christopher
Kirvin. The witness said that when Kirvin attacked a prison guard, Sparks
repeatedly flushed a toilet to mask the sound of her screams. Sparks also
admitted to a probation officer that he participated in the escape attempt. The
district court reasonably relied on the PSR.
* * *
Sparks’s sentence is AFFIRMED.
13
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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 December 20, 2004
Charles R. Fulbruge III
Clerk
No. 04-60124
Summary Calendar
GURVINDER KAUR GILL; JASMIN GILL,
Petitioners,
versus
JOHN ASHCROFT, U.S. ATTORNEY GENERAL,
Respondent.
--------------------
Petition for Review of an Order of the
Board of Immigration Appeals
BIA No. A78 567 224
BIA No. A78 567 225
--------------------
Before GARZA, DeMOSS, and CLEMENT, Circuit Judges.
PER CURIAM:*
Gurvinder Kaur Gill (“Gill”), a citizen of India, and Jasmin
Gill (“Jasmin”), Gill’s minor daughter, petition for review of an
order from the Board of Immigration Appeals (“BIA”) dismissing
their appeal of the immigration judge’s (“IJ”) decision to deny
their applications for asylum, withholding of removal under the
Immigration and Nationality Act (“INA”), and withholding of
removal under the Convention Against Torture (“CAT”). Because
*
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. 04-60124
-2-
Jasmin’s claims are dependent upon Gill’s claims, only Gill’s
claims require consideration.
Gill contends that the BIA erred by finding that she did not
establish her eligibility for asylum and withholding of removal
under the INA and CAT. Gill’s application for asylum was denied
as untimely. Because Gill has failed to address the timeliness
of her asylum application in her instant petition, that issue is
waived. See Rodriguez v. INS, 9 F.3d 408, 414 n.15 (5th Cir.
1993). The BIA affirmed the IJ’s determination that Gill’s
testimony alleging past persecution and fear of future
persecution was not credible. As Gill has failed to show
anything in the record compelling this court to overturn the
BIA’s credibility determination, that credibility determination
cannot be overturned. See Lopez De Jesus v. INS, 312 F.3d 155,
161 (5th Cir. 2002). Gill has therefore failed to show that the
BIA’s decision was not supported by substantial evidence. See
Mikhael v. INS, 115 F.3d 299, 302 (5th Cir. 1997). Moreover,
even if Gill’s testimony was deemed to be credible, the record
does not compel a finding that she met her burden to warrant
withholding of removal under the INA or the CAT. See Bah v.
Ashcroft, 341 F.3d 348, 352 (5th Cir. 2003); Mikhael, 115 F.3d at
302.
Accordingly, the petition for review is DENIED.
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Case: 15-40667 Document: 00513384979 Page: 1 Date Filed: 02/17/2016
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 15-40667
Conference Calendar
United States Court of Appeals
Fifth Circuit
FILED
February 17, 2016
UNITED STATES OF AMERICA,
Lyle W. Cayce
Clerk
Plaintiff-Appellee
v.
JORGE FRANCISCO TZUL-CHACLAN,
Defendant-Appellant
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 1:15-CR-38-1
Before DAVIS, SMITH, and PRADO, Circuit Judges.
PER CURIAM: *
The Federal Public Defender appointed to represent Jorge Francisco
Tzul-Chaclan has moved for leave to withdraw and has filed a brief in
accordance with Anders v. California, 386 U.S. 738 (1967), and United States
v. Flores, 632 F.3d 229 (5th Cir. 2011). Tzul-Chaclan has not filed a response.
We have reviewed counsel’s brief and the relevant portions of the record
reflected therein. We concur with counsel’s assessment that the appeal
* 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.
Case: 15-40667 Document: 00513384979 Page: 2 Date Filed: 02/17/2016
No. 15-40667
presents no nonfrivolous issue for appellate review. Accordingly, counsel’s
motion for leave to withdraw is GRANTED, counsel is excused from further
responsibilities herein, and the APPEAL IS DISMISSED. See 5TH CIR. R. 42.2.
2
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221 Cal.App.2d 299 (1963)
HOWARD B. CRITTENDEN, Jr., et al., Plaintiffs and Respondents,
v.
THOMAS T. CRITTENDEN, Defendant and Appellant.
Civ. No. 7265.
California Court of Appeals. Fourth Dist.
Oct. 16, 1963.
Thomas T. Crittenden, in pro. per., for Defendant and Appellant.
James B. Abbey for Plaintiffs and Respondents. *300
BROWN (Gerald), J.
Three brothers, Howard, Phillip and Thomas Crittenden were each left an undivided one-third interest as heirs of certain commercial property under a decree of distribution of their mother's estate. Being unable to agree among themselves, Howard and Phillip brought a complaint in partition for sale of the premises. The defendant, Thomas, did not answer or make an appearance within the required time, and a default judgment was taken against him and an interlocutory decree of partition was ordered by the court. Defendant's motion to set aside the default was denied, and he has brought this appeal, contending in three points that he was denied a right to be present at the court hearing by reason of a wrongful taking of the default, that the wrongful default taking deprived him of the right to an accounting, and that the partition action was inequitable because the other two owners were trying to "freeze him out" for their personal gain.
[1a] The partition action was filed on September 5, 1962, and defendant was served with summons and complaint on September 11. Defendant wrote plaintiffs' attorney two letters dated October 5, and October 20, and conferred with him respecting possible settlement. The crucial letter on which the basis for taking the default rests was dated October 23, and was written by plaintiffs' attorney to defendant. It suggested a method of settling the case, and that if the terms were agreeable, defendant should sign a copy of the letter and return it to plaintiffs' attorney; otherwise defendant should file an answer or appear in the action before November 5.
After defendant made no appearance, plaintiffs requested entry of default on November 15. A default hearing was conducted on November 26, and an interlocutory judgment of partition was entered on December 3. A month later, defendant moved to set aside the default, accompanying his motion with affidavit, demurrer and proposed answer. Defendant's affidavit stated that he signed and returned the copy of the letter of October 23. Counteraffidavits filed by plaintiffs' attorney and his secretary denied receipt of such letter. Defendant's motion to set aside the default was denied on January 14, 1963.
[2] An order denying a motion to vacate a default judgment will not be reversed in the absence of a clear showing of an abuse of discretion by the trial court. (Warren v. Warren, 120 Cal.App.2d 396 [261 P.2d 309]; Baratti v. Baratti, 109 *301 Cal.App.2d 917 [242 P.2d 22].) [3] Nevertheless, bearing in mind that cases should be heard on their merits whenever possible, an appellate court will carefully scan orders denying motions to set aside defaults. (Karlein v. Karlein, 103 Cal.App.2d 496 [229 P.2d 831].)
[1b] The Code of Civil Procedure, section 473, provides that the court may relieve a party from a judgment, order or proceeding taken against him through his mistake, inadvertence, surprise or excusable neglect. Defendant claims that his mistake and excusable neglect consisted of reliance upon the integrity of plaintiffs' counsel.
A study of the record and the affidavits of plaintiffs' attorney and his secretary reveals sufficient and substantial evidence to sustain the position of the trial court in denying defendant's motion to set aside the default. Furthermore, it appears by the proposed answer and the law that defendant could not block a partition of the property; his proposed answer, in effect, admits the right to partition, and such right is well established. (Lazzarevich v. Lazzarevich, 39 Cal.2d 48 [244 P.2d 1].)
Plaintiffs' previous motion to dismiss the appeal on the ground the appeal is frivolous, and which was continued to be heard and decided on a hearing on the merits, is denied.
The judgment and all orders in connection therewith are affirmed.
Griffin, P. J., and Coughlin, J., concurred.
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Fourth Court of Appeals
San Antonio, Texas
June 9, 2014
No. 04-13-00549-CV
Ernest MUNGIA,
Appellant
v.
VIA METROPOLITAN TRANSIT,
Appellee
From the County Court at Law No. 3, Bexar County, Texas
Trial Court No. 380931
Honorable Tina Torres, Judge Presiding
ORDER
Sitting: Catherine Stone, Chief Justice
Sandee Bryan Marion, Justice
Rebeca C. Martinez, Justice
The panel has considered the appellee’s motion for rehearing, and the motion is
DENIED.
_________________________________
Catherine Stone, Chief Justice
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the seal of the said
court on this 9th day of June, 2014.
___________________________________
Keith E. Hottle
Clerk of Court
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OSCN Found Document:O'BRIEN v. BERRY
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O'BRIEN v. BERRY2016 OK CIV APP 28Case Number: 113216Decided: 03/28/2016Mandate Issued: 04/26/2016DIVISION IVTHE COURT OF CIVIL APPEALS OF THE STATE OF OKLAHOMA, DIVISION IV
Cite as: 2016 OK CIV APP 28, __ P.3d __
SHERRINE LYNN O'BRIEN, Petitioner/Appellee,
v.
CHRIS ALLEN BERRY, Defendant/Appellant.
APPEAL FROM THE DISTRICT COURT OF
LINCOLN COUNTY, OKLAHOMA
HONORABLE DAWSON ENGLE, TRIAL JUDGE
AFFIRMED
James J. Hodgens, JAMES J. HODGENS, PC, Stroud, Oklahoma, for Petitioner/Appellee
Joseph M. Vorndran, George Wright, STUART & CLOVER, PLLC, Shawnee, Oklahoma, for Defendant/Appellant
JOHN F. FISCHER, JUDGE:
¶1 Chris Allen Berry appeals an order of protection issued pursuant to the Protection from Domestic Abuse Act, 22 O.S.2011 & Supp. 2013 §§ 60 to 60.20, in favor of Sherrine Lynn O'Brien. Berry argues that O'Brien failed to prove an act of domestic abuse required to obtain an order of protection, that the district court erred in refusing to admit certain exhibits he offered during the trial and the district court's order is precluded by a ruling in his favor on the same matter issued by the tribal court in which O'Brien first filed for a protective order. Berry has failed to show an abuse of discretion by the district court, and we affirm.
BACKGROUND
¶2 O'Brien and Berry had been living together for approximately fourteen months in what the district court described as a "domestic intimate relationship." On the morning of July 20, 2014, the parties were involved in a physical altercation, one of several during the time the parties were together. O'Brien left Berry's home after the altercation and stayed in lodging provided by the House of Hope. She moved out of Berry's home the following day.
¶3 O'Brien filed an application for a protective order in the District Court of the Citizen Potawatomi Nation on July 25, 2014. A "show cause" hearing was held four days later. At the conclusion of that hearing, the tribal judge declined to issue an emergency protective order and set the matter for trial on August 26, 2014. O'Brien voluntarily dismissed her tribal court action on August 5, 2014.
¶4 On August 11, 2014, O'Brien filed this action. The matter was tried and district court found that O'Brien had met her burden of proof. Berry appeals the protective order issued on that date.1
STANDARD OF REVIEW
¶5 Orders issued pursuant to proceedings invoking the Protection from Domestic Abuse Act are reviewed for an abuse of discretion. Curry v. Streater, 2009 OK 5, 213 P.3d 550.
Under an abuse of discretion standard, the appellate court examines the evidence in the record and reverses only if the trial court's decision is clearly against the evidence or is contrary to a governing principle of law. State ex rel. Tal v. Oklahoma City, 2002 OK 97, ¶ 3, 61 P.3d 234, 240. To reverse under an abuse of discretion standard, an appellate court must find the trial court's conclusions and judgment were clearly erroneous, against reason and evidence. Oklahoma Tpk. Auth. v. Little, 1993 OK 116, ¶ 6, 860 P.2d 226, 228.
Id. ¶ 8.
ANALYSIS
¶6 The evidence produced at trial was conflicting. O'Brien testified that on the morning of July 20, she was at home after working the night shift at the casino where she was employed as a security guard. She had a couple of drinks before Berry returned home from the night shift he worked as a police officer for the Citizen Potawatomi Nation. They had one drink together, and then O'Brien went to bed. She testified that she woke up because Berry was screaming her name. She realized he was very angry, so she pretended she was still asleep. According to O'Brien, Berry threw her out of the bed, dragged her to the bathroom skinning her knees, stood on her foot cutting her ankle, put her in the shower and turned on the cold water. When she attempted to leave the house, Berry blocked her path and choked her, causing bruising to her throat and chest. Eventually, Berry called neighbors, who took O'Brien, at her request, to the casino where she worked. O'Brien also testified that she filed a police report regarding the incident and, after she moved out, Berry had come to her place of work and stood nearby trying to intimidate her.
¶7 Berry appeared pro se at the hearing. He testified that after he and O'Brien had one drink together, she went to the bedroom, where he found her lying on the floor next to the bed and unresponsive. Berry testified that he believed O'Brien was having a reaction to the antidepressant medication she was taking, which was brought on by her "heavy drinking," and that she might have "poisoned herself." He claimed he tried to revive her, and when he was not successful he put her in the shower and then phoned the sheriff's department, but the department would not send over a deputy. However, Berry's testimony also revealed that he informed the sheriff's department that he "had a domestic situation," and did not mention any medical emergency involving O'Brien. Based on the information Berry provided during that phone call, the sheriff's department advised him "to go get an eviction notice." On cross-examination, Berry testified that he did not call 911, contrary to his training as a "first responder." He testified that when O'Brien "finally came to" she started screaming that she wanted to leave. He called the next door neighbors, who came to his home and took O'Brien with them.
¶8 Both neighbors and Berry's son also testified. These witnesses generally supported some aspects of Berry's version of the incident. They also supported aspects of O'Brien's testimony, including the injury to her knees. However, because none of these witnesses had any personal knowledge of the actual altercation between O'Brien and Berry, they were not able to testify regarding any details of the incident. The district court found that O'Brien had "met her burden of proof" and granted her request for a protective order.
I. What Constitutes Domestic Abuse
¶9 Berry's appeal raises various arguments. He argues that O'Brien failed to prove by "clear and convincing evidence" that she was physically harmed. Berry has not cited any authority supporting his contention that O'Brien was required to prove domestic abuse by clear and convincing evidence. We find nothing in the Protection from Domestic Abuse Act, or any case interpreting the Act, imposing this heightened burden of proof on O'Brien. The focus of Berry's argument, however, is on the evidence required to prove "domestic abuse," and raises an issue not previously decided: What constitutes domestic abuse resulting from physical harm for purposes of the Protection from Domestic Abuse Act?2 As relevant to this case, "domestic abuse" is defined as "any act of physical harm . . . which is committed by an adult . . . against another adult . . . who are or were in a dating relationship." 22 O.S.2011 § 60.1(1). "A victim of domestic abuse . . . may seek relief under the provisions of the Protection from Domestic Abuse Act." 22 O.S. Supp. 2013 § 60.2.
A. Evidence Necessary to Prove Physical Harm
¶10 Berry argues that this Court has previously declined to define "physical harm" as that term is used in the Act. See Marquette v. Marquette, 1984 OK CIV APP 25, 686 P.2d 990 (holding the Act is civil, not criminal in nature and refusing to adopt the beyond-a-reasonable-doubt burden of proof applicable in criminal cases). Berry's reliance on Marquette is misplaced for two reasons. First, the Marquette Court did not refuse to define "physical harm." It merely refused to adopt a "'blood and guts' interpretation" of the statutory language. Id. ¶ 12. Second, the version of the statute at issue in Marquette differs from the version of the statute applicable in this case. No longer is a plaintiff required to prove "serious physical harm" in order to obtain an order of protection, as was required when Marquette was decided. See 22 O.S. Supp. 1983 § 60.1. An order of protection is now authorized on proof of "any act of physical harm." 22 O.S.2011 § 60.1(1).
¶11 Berry relies on photographs taken of O'Brien the day of the incident.3 He contends these photographs show minimal injuries to O'Brien. It does not matter that O'Brien received only "minor injuries" as Berry contends. Berry engaged in domestic abuse if he caused "any act of physical harm." The fact that the Legislature amended the Protection from Domestic Abuse Act to delete the requirement for proof of "serious injury" fully addresses Berry's argument. Where, as here, the Legislature amends a statute that "expresses a clear and unambiguous intent . . . [the] legislative amendment is presumed to change the existing law." Samman v. Multiple Injury Trust Fund, 2001 OK 71, ¶ 13, 33 P.3d 302. Pursuant to the applicable statute in this case, domestic abuse is shown by evidence of "any act of physical harm" whether or not the perpetrator deems the harm serious.
B. Intent to Harm
¶12 Next, Berry argues that even though O'Brien might have suffered some physical harm, he did not intend to harm her, and any harm she sustained was either self-inflicted or incidental to his efforts to revive her when he found her unresponsive. He contends we should adopt the tort of battery definition of intent or the "willful" and "unlawful" use of force or violence elements required to prove the crime of domestic abuse. See 21 O.S.2011 § 644(C) and Oklahoma Uniform Jury Instructions - [OUJI] Criminal No. 4-26A. The Protection from Domestic Abuse Act authorizes an order of protection on proof of: (1) domestic abuse, (2) stalking or (3) harassment. "Stalking" and "harassment" are both defined in the Act in terms of willful, malicious and knowing conduct. 22 O.S.2011 § 60.1(2) and (3). No similar language appears in the definition of domestic abuse. Nonetheless, we find that the Act requires some element of intent.
¶13 First, we note that the Supreme Court reached this conclusion in determining "the elements of domestic abuse by threat of imminent harm under the Act." Curry v. Streater, 2009 OK 5, ¶ 14. The Court found that "[a] threat is '[a]n expression of an intention to inflict' . . . imminent physical harm" or a 'communicated intent to inflict physical or other harm on any person or on property.'" Id. ¶ 15 (quoting American Heritage Dictionary 1265 (2nd coll. ed. 1976), and Black's Law Dictionary 1327 (5th ed. 1979)). It would be absurd to require proof of intent to threaten harm but not proof of intent to actually physically harm, particularly when those two actions appear in the same definition of domestic abuse. See Ledbetter v. Okla. Alcoholic Beverage Laws Enforcement Comm'n, 1988 OK 117, ¶ 7, 764 P.2d 172 (statutory construction that would lead to an absurdity must be avoided). Further, exempting acts of physical harm from the intent required to prove all other acts authorizing an order of protection (i.e., threats of harm, stalking and harassment) is antithetical to a consistent construction of the Act. See Okla. Ass'n for Equitable Taxation v. City of Oklahoma City, 1995 OK 62, ¶ 5, 901 P.2d 800 (legislative intent is ascertained from the whole act based on its general purpose and objective and construing relevant provisions together to give full force and effect to each).
¶14 In the absence of a statutory definition, we look to the ordinary meaning of the phrase "any act of physical harm" as did the Supreme Court in Curry. As relevant here, an "act" is "the process of doing or performing" or "the external manifestation of [a person's] will." Black's Law Dictionary 24-25 (7th ed. 1999). For context, we look to the meaning of "abuse," which is also defined as an intentional act, e.g., "[p]hysical or mental maltreatment." Id. at 10. We find that the element of intent required in cases of civil battery best defines the level of intent required to prove an act of domestic abuse. "A person intends to commit a battery if [he/she] acts for the purpose of making a [harmful/offensive] contact with another." OUJI-Civil No. 19.8.
C. O'Brien's Physical Harm
¶15 Berry did not object when O'Brien introduced photographs of her injuries taken three days after the incident. Berry did not include the photographs O'Brien introduced in this appellate record. However, the transcript of O'Brien's trial testimony reflects her description of injuries to her arm, chest, throat, ankle and knees as depicted by those photographs. Therefore, we must assume O'Brien's photographic exhibits are representative of the injuries O'Brien described during her trial testimony. "The appellant bears the total responsibility for including in the appellate record all materials necessary to secure corrective relief." Hamid v. Sew Original, 1982 OK 46, ¶ 6, 645 P.2d 496. The injuries O'Brien described are consistent with her version of the altercation and the physical harm Berry inflicted. Even the photographs that Berry claims the district court erroneously excluded confirm injury to O'Brien's knees, ankle and throat.
¶16 Nonetheless, Berry argues that the injuries O'Brien described are consistent with his claim that her injuries resulted from an accidental slip and fall on the linoleum floor as she was running from the shower, or were incidental to his efforts to revive her. Berry argues that the "question before this Court is whether [O'Brien] established that she was subjected to domestic abuse through physical harm by Berry." That is not the question. We may not re-weigh the evidence or substitute our findings for those of the district court. Curry v. Streater, 2009 OK 5, ¶ 17. The issue of Berry's intent regarding his physical contact with O'Brien on July 20, 2014, was squarely before the district court. Although the testimony of O'Brien and Berry differed regarding how O'Brien's injuries occurred, the rule is "well established" that the district court was in the best position to determine their credibility. Taylor v. Taylor, 1963 OK 263, ¶ 15, 387 P.2d 648. After hearing the testimony of all the witnesses and viewing all of the evidence, the district court granted O'Brien's request for a protective order. We have reviewed the evidence in the appellate record and find that the district court's conclusion that Berry committed domestic abuse is not "clearly erroneous, [or] against reason and evidence." Oklahoma Tpk. Auth. v. Little, 1993 OK 116, ¶ 6.4
II. The Preclusion Argument
¶17 Berry asserts in his final argument that the district court's order is precluded by the favorable ruling he obtained in the Citizen Potawatomi Nation District Court. Relying on the doctrine of issue preclusion, he contends that O'Brien actually litigated her entitlement to a protective order in tribal court and therefore was barred from relitigating that issue here. "[O]nce a court has decided an issue of fact or law necessary to its judgment, the same parties or their privies may not relitigate that issue in a suit brought upon a different claim." State ex rel. Oklahoma Bar Ass'n v. Giger, 2004 OK 43, ¶ 13, 93 P.3d 32 (footnote omitted). Clearly, the injuries O'Brien received on July 20, 2014, were the subject of her Petition for Protective Order filed in the tribal court. However, that petition sought to invoke the protection of the Violence Against Women Act, 18 U.S.C. § 2265. Berry has not shown that the federal law and Oklahoma's Protection from Domestic Abuse Act are sufficiently identical, requiring a finding that the legal issues O'Brien raised in the district court were "actually adjudicated" in tribal court. Carris v. John R. Thomas and Assocs., P.C., 1995 OK 33, ¶ 11, 896 P.2d 522.
¶18 Further, Berry mischaracterizes the effect of the tribal court's ruling as declining to grant O'Brien a protective order "on the merits." The tribal court heard evidence at a "show cause" hearing conducted on July 29, 2014. At the conclusion of that hearing, the tribal court denied what Berry described as O'Brien's request for an emergency protective order, and then set the matter for "an evidentiary hearing" on August 26, 2014. Although there need not be a final judgment on the merits of the case for issue preclusion to apply, there must be "a final determination of a material issue common to both cases." Giger, 2004 OK 43, ¶ 13 (footnote omitted). Berry has not shown, as is his burden, that the tribal court's ruling determined the action, prevented a judgment in favor of O'Brien or possessed the finality required to invoke issue preclusion. Cf., Nat'l Diversified Bus. Servs., Inc. v. Corporate Fin. Opportunities, Inc., 1997 OK 36, ¶ 13, 946 P.2d 662 (final order as defined in 12 O.S.2011 § 953 will preclude relitigation of issues encompassed in that order). In fact, it is apparent from this limited record that, at the show cause hearing in the tribal court proceeding, no final determination was made on O'Brien's ultimate entitlement to a protective order. And it is undisputed that O'Brien dismissed her tribal court action before that final determination could be made at the later scheduled evidentiary hearing. Absent a final determination of the right to a protective order, O'Brien was "free to abandon the course then in pursuit [and] to relaunch or press the same claim along a different remedial track." Id. That is the course of action she chose.
CONCLUSION
¶19 The applicable version of the Protection from Domestic Abuse Act requires proof of "any act of physical harm" to establish domestic abuse. The seriousness of the injury or harm is not the determining factor. However, the defendant must act for the purpose of making the harmful contact. The district court's conclusion that Berry did so in this case is not against the clear weight of evidence in this record and does not constitute an abuse of discretion. Further, Berry has not demonstrated that the district court's protective order was precluded by the proceedings in the Citizen Potawatomi Nation District Court. The district court's August 21, 2014 Order of Protection is affirmed.
¶20 AFFIRMED.
GOODMAN, C.J., and WISEMAN, P.J., concur.
FOOTNOTES
1 O'Brien did not appear or file an answer brief in this appeal. "Where there is an unexcused failure to file an answer brief, this Court is under no duty to search the record for some theory to sustain the trial court judgment; and where the brief in chief is reasonably supportive of the allegations of error, this Court will ordinarily reverse the appealed judgment with appropriate directions." Cooper v. Cooper, 1980 OK 128, ¶ 6, 616 P.2d 1154; Okla. Sup. Ct. R. 1.10, 12 O.S. Supp. 2013, ch. 15, app. 1. However, "[r]eversal is never automatic on a party's failure to file an answer brief." Enochs v. Martin Props., Inc., 1997 OK 132, ¶ 6, 954 P.2d 124 (footnote omitted). If "the record presented fails to support the error alleged in the brief of the party who lost below, the decision to be reviewed cannot be disturbed. It is presumed correct until the contrary is shown by the record." Id. For the reasons stated in this Opinion, we find that Berry has failed to show that the district court's order of protection was incorrect.
2 In Curry v. Streater, 2009 OK 5, 213 P.3d 550, the Supreme Court construed the provision of the Protection from Domestic Abuse Act concerned with the aspect of the definition of domestic abuse resulting from "threats of imminent physical harm." 22 O.S.2011 § 60.1(1). The basis of the district court's order of protection in this case was the finding of actual "physical harm," the second aspect of the definition of domestic abuse. Id.
3 Berry offered these exhibits during his case in chief but did not lay the foundation necessary to authenticate the photographs, and the district court sustained O'Brien's objection "at this time." Berry also offered a copy of what he claimed to be the "warning label" on medication O'Brien had been prescribed. Admission of this exhibit was also denied for lack of a foundation. Berry made no effort thereafter to correct the lack-of-foundation issue regarding these exhibits or properly authenticate either exhibit. The district court admitted all the other exhibits Berry offered at the hearing. Berry now argues that the district court erred in refusing to admit his warning label and photograph exhibits. Absent a showing that the exclusion of these exhibits affected a "substantial right" or was so prejudicial that it resulted in a "different" outcome, Berry cannot prevail on this issue. See State ex rel. Dep't of Transp. v. Caliber Dev. Co., LLC, 2016 OK CIV APP 1, ¶¶ 23; 24, ___ P.3d ___ (approved for publication by the Supreme Court). Berry has made no such showing. See Funnell v. Jones, 1985 OK 73, ¶ 4, 737 P.2d 105 (pro se litigants are generally held to the same standards as an attorney).
4 For this reason, we also find that Berry is not entitled to a "good Samaritan" or "rescue doctrine" defense.
Citationizer© Summary of Documents Citing This Document
Cite
Name
Level
None Found.
Citationizer: Table of Authority
Cite
Name
Level
Oklahoma Court of Civil Appeals Cases
CiteNameLevel
2016 OK CIV APP 1, 365 P.3d 1067, STATE ex rel. DEPT. OF TRANSPORTATION v. CALIBER DEVELOPMENT CO. LLCCited
1984 OK CIV APP 25, 686 P.2d 990, Marquette v. MarquetteDiscussed
Oklahoma Supreme Court Cases
CiteNameLevel
1988 OK 117, 764 P.2d 172, 59 OBJ 2936, Ledbetter v. Oklahoma Alcoholic Beverage Laws Enforcement Com'nDiscussed
1993 OK 116, 860 P.2d 226, 64 OBJ 2879, Oklahoma Turnpike Authority v. LittleDiscussed at Length
1997 OK 36, 946 P.2d 662, 68 OBJ 1167, National Diversified Business Services, Inc. v. Corporate Financial Opportunities, Inc.Discussed
2001 OK 71, 33 P.3d 302, 72 OBJ 2703, SAMMAN v. MULTIPLE INJURY TRUST FUNDDiscussed
1963 OK 263, 387 P.2d 648, TAYLOR v. TAYLORDiscussed
1995 OK 33, 896 P.2d 522, 66 OBJ 1239, Carris v. John R. Thomas and Associates, P.C.Discussed
1995 OK 62, 901 P.2d 800, 66 OBJ 2037, Oklahoma Assn. for Equitable Taxation v. City of Oklahoma CityDiscussed
2002 OK 97, 61 P.3d 234, STATE ex rel. TAL v. CITY OF OKLAHOMA CITYDiscussed
2004 OK 43, 93 P.3d 32, STATE OF OKLAHOMA ex rel. OKLAHOMA BAR ASSOCIATION v. GIGERDiscussed at Length
2009 OK 5, 213 P.3d 550, CURRY v. STREATERDiscussed at Length
1980 OK 128, 616 P.2d 1154, Cooper v. CooperDiscussed
1997 OK 132, 954 P.2d 124, 68 OBJ 3523, ENOCHS v. MARTIN PROPERTIES, INCDiscussed
1982 OK 46, 645 P.2d 496, Hamid v. Sew OriginalDiscussed
1985 OK 73, 737 P.2d 105, Funnell v. JonesDiscussed
Title 12. Civil Procedure
CiteNameLevel
12 O.S. 953, Final Order DefinedCited
Title 21. Crimes and Punishments
CiteNameLevel
21 O.S. 644, Punishment for Assault and BatteryCited
Title 22. Criminal Procedure
CiteNameLevel
22 O.S. 60, Short TitleCited
22 O.S. 60.1, DefinitionsDiscussed at Length
22 O.S. 60.2, Protective Order - Petition - Form - Filing Fee - Preparation - Protection of AnimalCited
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____________
No. 95-2272
____________
Kou Thao, *
*
Petitioner, *
*
v. * Petition for Review of an
* Order of the Immigration
Immigration and Naturalization * & Naturalization Servie
Service, *
* [UNPUBLISHED]
Respondent. *
____________
Submitted: February 12, 1996
Filed: August 12, 1996
____________
Before McMILLIAN, LAY and HANSEN, Circuit Judges.
____________
PER CURIAM.
Kou Thao (petitioner) seeks review of a final decision of the Board
of Immigration Appeals (BIA) dismissing his appeal from a deportation order
entered by an immigration judge (IJ) (hereinafter "IJ order"). In re Kou
Thao, No. A25 315 638 (B.I.A. Apr. 25, 1995) (order dismissing appeal)
(hereinafter "BIA order"). The sole issue raised by this petition for
review is whether the BIA erred in holding that petitioner's conviction
under Minnesota state law for assault in the second degree constitutes a
firearms offense within the meaning of § 241(a)(2)(C) of the Immigration
and Nationality Act, 8 U.S.C. § 1251(a)(2)(C).
In Kao Vue v. INS, No. 95-3421, slip op. at 6 (8th Cir. Aug. 12,
1996), we held that, in order for an offense to come within the meaning of
§ 1251(a)(2)(C), the use, etc., of a weapon
must be an element of the offense of conviction and the weapon in question
must be a firearm or destructive device. Whether the latter requirement
has been met is a determination which the immigration judge may make by
reviewing the record of conviction. Slip op. at 7. However, the
information in the record of conviction demonstrating that a firearm or
destructive device was used must not be mere surplusage. Id. at 9.
In the present case, the criminal offense for which petitioner was
convicted has as an essential element the use of a "dangerous weapon." See
Minn. Stat. Ann. § 609.222 (West 1991) (assault in the second degree). The
IJ reviewed the sentencing transcript as part of petitioner's record of
conviction. IJ order at 4. Based upon that document, the IJ concluded
that petitioner did in fact use a firearm in the commission of his offense.
Id. Moreover, because the information regarding petitioner's use of a
firearm demonstrated that an element of petitioner's offense had been
satisfied, it was not mere surplusage.
Accordingly, upon careful de novo review, we hold that the BIA did
not err in determining that petitioner is deportable pursuant to 8 U.S.C.
§ 1251(a)(2)(C). The order of the BIA is affirmed. See 8th Cir. R. 47B.
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
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57 F.3d 1069NOTICE: 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.
Barbara Thompson INMAN, Plaintiff-Appellant,v.SECRETARY OF HEALTH AND HUMAN SERVICES, Defendant-Appellee.
No. 94-3635.
United States Court of Appeals, Sixth Circuit.
June 9, 1995.
Before: NELSON and DAUGHTREY, Circuit Judges, and HILLMAN, District Judge.*
PER CURIAM.
1
This is an appeal from a summary judgment in which the district court upheld a denial of Supplemental Security Income benefits by the Secretary of Health and Human Services. The judgment was entered on the recommendation of a magistrate judge, and the district judge, in accepting the recommendation, indicated that she was doing so without further review because the recommendation had not been objected to by either party.
2
On May 1, 1995, this court entered an order directing the plaintiff to show cause why the appeal should not be dismissed because of the failure to file timely objections to the report and recommendation of the magistrate judge. The plaintiff filed a satisfactory response, and we shall therefore decide the case on the merits.
3
Upon de novo review of the record as a whole, we conclude that no prejudicial legal error was committed in the administrative proceedings and that the administrative record contains substantial evidence to support the Secretary's determination that the plaintiff was not disabled. The judgment will therefore be affirmed.
4
An administrative law judge conducted a hearing and thereafter issued a 22-page decision concluding that the claimant, Barbara Thompson Inman, was not eligible for SSI benefits. The decision--which became the final decision of the Secretary after the Appeals Council denied review--contains a thorough and accurate review of the documentary medical evidence and of the testimony presented at the hearing.
5
The record establishes, the ALJ found, that Mrs. Inman--a "younger" woman who has not worked since the last of a series of back injuries sustained during 1988 in her work as a nurse's aide--"has severe acute or chronic low back strain or sprain; asthma and bronchitis; dysthymic disorder with elements of anxiety, depression and chronic pain syndrome; and, personality disorder with numerous features." The ALJ further found that Mrs. Inman's impairments did not meet or equal any of the impairment "listings" which, under the governing regulations, call for a finding of disability without consideration of vocational factors; that although Mrs. Inman is unable to perform her past relevant work as a nurse's aide, she has the capacity to perform light work that does not require more than occasional bending as long as the work is of a routine nature, in a low stress environment, and would not expose her to heavy concentrations of fumes or dust; and that jobs which Mrs. Inman can perform exist in significant numbers in northeastern Ohio, where she lives, and in the national economy.
6
In the proceedings before the magistrate judge Mrs. Inman contended that she met Listing 1.05C, which covers vertebrogenic disorders such as herniated nucleus pulposis and spinal stenosis. See 20 C.F.R. Pt. 404, Subpt. P,App. 1, Sec. 1.05C. The record does not demonstrate that she had a herniated disc or spinal stenosis, however--on the contrary, a CT scan was reported as negative, and x-rays of the lumbosacral spine showed that the heights of the vertebral bodies and intervertebral disc spaces were well maintained--and this argument has not been pressed on appeal. Neither does the plaintiff challenge the conclusion that she failed to meet any of the mental disorders listings. We note that this conclusion was fully supported by the testimony of the medical advisor who appeared at the hearing, Daniel E. Schweid, M.D.
7
The main argument presented here is that the ALJ erred as a matter of law in failing to give conclusive effect to certain opinions reported by Mrs. Inman's treating physicians, William Wasson, M.D., and Norman Lefkovitz, M.D. Dr. Wasson began seeing Mrs. Inman in March of 1989, some months after she stopped working at the nursing home where she was last employed. On June 28, 1989, he prepared a report for the Ohio workers' compensation authorities in which he expressed the opinion that Mrs. Inman could not lift over 10 pounds and was unable to return to work. Dr. Lefkovitz first evaluated her in May of 1991, and in July of that year he sent Mrs. Inman's lawyer a short letter stating, in conclusory terms, that "this patient is not capable of sustained remunerative employment based upon her medical conditions."
8
Dr. Wasson's report did not explain the basis for his conclusion that Mrs. Inman could not lift more than 10 pounds, and Dr. Schweid testified that there was not enough documentation to support such a conclusion. Mrs. Inman argues that Dr. Schweid, whose specialty is psychiatry, "is not qualified to testify as to claimant's physical impairments." We disagree. Dr. Schweid received an M.D. degree from Western Reserve University School of Medicine in 1965 and belongs to the American College of Physicians. He is certainly qualified to read and interpret medical records such as those at issue here and to explain their significance to the ALJ. That is what he did. In the context of the record as a whole, his testimony provides adequate support for the ALJ's decision to reject Dr. Wasson's view that Mrs. Inman could not lift more than 10 pounds.
9
As to Dr. Wasson's finding that Mrs. Inman was unable to return to work in June of 1989, the ALJ agreed that she was not able to return to the type of work she had been doing in the nursing home. After careful analysis of all of Dr. Wasson's reports, however, and taking into account the full medical record and the testimony provided by all of the witnesses at the hearing, the ALJ found that there was other work Mrs. Inman could do.
10
In making this finding, the ALJ did not overlook the views of Dr. Lefkovitz. Mrs. Inman was examined by Dr. Lefkovitz on May 9 and May 21, 1991. His impression, as recorded in a office note prepared at the time of the first of these visits, was that she had a chronic lumbosacral strain/sprain injury. He noted that she had been through a course of physical therapy "with some benefit," and that she "uses a TENS [transcutaneous electric nerve stimulator] unit and a back brace which help." He specifically indicated, as the ALJ noted, that while Mrs. Inman has decreased range of motion, there was no evidence of sensory changes or reflex abnormalities or muscle strength loss, and there was no impairment in her ability to walk on her heels and toes and to rise from a squatting position. As the ALJ also noted, Dr. Lefkovitz did not report any muscle atrophy.
11
Dr. Lefkovitz referred to Mrs. Inman's asthma and other medical conditions in expressing the opinion that she was "not capable of sustained remunerative employment." As the ALJ indicated, however, Dr. Lefkovitz does not appear to have attended Mrs. Inman for any condition other than her low back complaints. Dr. Philip White, a specialist in pulmonary disease, described her asthma as "very mild." It was also Dr. White's impression that "her lumbosacral spine [condition] was of a mild degree."
12
The ALJ carefully reviewed Mrs. Inman's hospital charts, which show a series of emergency room visits. After Mrs. Inman stopped doing heavy work at the nursing home and applied for SSI benefits, the ALJ observed, there was only one emergency room visit prompted by her back complaints--and such a visit, coupled with the relatively infrequent outpatient visits to Dr. Wasson and Dr. Lefkovitz, did not indicate debilitating pain. The ALJ pointed out, moreover, that the outpatient notes on Mrs. Inman's physical therapy show a number of missed visits, failure to perform the home exercises that had been prescribed for her, and performance of unauthorized exercise in the form of jogging.
13
Against the background described in the ALJ's decision, the ALJ was not bound by the treating physicians' opinions. See Cutlip v. Secretary of HHS, 25 F.3d 284, 287 (6th Cir.1994), and the cases there cited. The ALJ did not err, moreover, in his use of testimony presented by a vocational expert on the number of jobs Mrs. Inman could perform. The failure of the vocational expert to refer to the Dictionary of Occupational Titles does not necessitate an additional hearing.
14
The show cause order of May 1, 1995, is DISCHARGED, and the judgment of the district court is AFFIRMED.
*
The Honorable Douglas W. Hillman, United States District Judge for the Western District of Michigan, sitting by designation
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573 F.2d 3
UNITED STATES of America, Plaintiff-Appellant,v.Stanley KINSMAN, Defendant-Appellee.
No. 76-1657.
United States Court of Appeals,Ninth Circuit.
April 6, 1978.
Theodore Wai Wu, Asst. U. S. Atty., Los Angeles, Cal., for plaintiff-appellant.
Carl E. Stewart (argued), Newport Beach, Cal., for defendant-appellee.
Before BARNES, HUFSTEDLER and GOODWIN, Circuit Judges.
ORDER
1
The Government's petition for rehearing is granted. The opinion heretofore filed is ordered withdrawn. Disposition of the Government's petition for rehearing in this case was deferred pending disposition of United States v. Rodriguez-Gastelum, 569 F.2d 482 (9th Cir. en banc 1978). Upon the authority of Rodriguez-Gastelum, we vacate the order below, and remand the case to the district court for the purpose of the district court's determining the question whether Kinsman waived his right to counsel before he made his inculpatory statements. The district court may, in its discretion, make appropriate findings and issue its order on the present record, or it may conduct a further evidentiary hearing directed to the issue.
2
Order vacated and cause remanded for further proceedings consistent with the views herein expressed.
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IN THE SUPREME COURT OF PENNSYLVANIA
EASTERN DISTRICT
COMMONWEALTH OF PENNSYLVANIA, : No. 59 EAL 2019
:
Respondent :
: Petition for Allowance of Appeal from
: the Order of the Superior Court
v. :
:
:
JOYCE SCHOFIELD, :
:
Petitioner :
ORDER
PER CURIAM
AND NOW, this 2nd day of August, 2019, the Petition for Allowance of Appeal is
DENIED.
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665 F.2d 476
HOWMET ALUMINUM CORPORATION, a subsidiary ofPechiney-Ugine-Kuhlmann Corporation, Appellantv.HARTFORD ACCIDENT AND INDEMNITY COMPANYHOWMET ALUMINUM CORPORATION, a subsidiary ofPechiney-Ugine-Kuhlmann Corporationv.HARTFORD ACCIDENT AND INDEMNITY COMPANY, Appellant.
Nos. 81-1780, 81-1781.
United States Court of Appeals,Third Circuit.
Argued Nov. 17, 1981.Decided Dec. 4, 1981.
Henry B. FitzPatrick, Jr. (argued), Liebert, Short, FitzPatrick & Lavin, Philadelphia, Pa., for Howmet Aluminum Corp.
M. Landon Spencer (argued), McWilliams & Sweeney, Philadelphia, Pa., for Hartford Acc. & Indem. Co.
Before GIBBONS and HIGGINBOTHAM, Circuit Judges, and McCUNE, District Judge.*
OPINION OF THE COURT
GIBBONS, Circuit Judge.
1
Hartford Accident and Indemnity Company (Hartford) appeals from a judgment against it for the amount of its policy limit in a suit by Howmet Aluminum Corp., a subsidiary of Pechiney-Ugine-Kuhlmann Corporation (Howmet) to recover for theft losses. Hartford claims that trial errors in the admission of evidence warrant a new trial. Howmet also appeals, contending that the court erred in failing to include in the judgment interest from the date the suit was filed. We affirm in Hartford's appeal and reverse and remand in Howmet's appeal for the entry of a judgment including interest.
Hartford's Appeal
2
Over objection the trial court admitted evidence that Hartford issued insurance policies to Howmet for the periods September 1, 1978 to September 1, 1979, and September 1, 1979 to September 1, 1980. None of the losses for which recovery is sought occurred during those periods. The evidence disclosed that higher premiums were paid in those periods than for the coverages in 1976 and 1977 when the losses occurred. In ruling on Hartford's motion for a new trial the court concluded that the evidence was not relevant, but that its admission was harmless. The only prejudice claimed by Hartford is that the jury learned that premiums for policy periods later than the loss periods increased. The court ruled that "... it would be difficult to find a juror who is not aware that insurance premiums have a tendency to increase from year to year." We agree with the trial court that if there was error it was harmless. See Fed.R.Civ.P. 61.
3
Hartford also contends that the court erred in admitting in evidence, over an objection that it was hearsay, an investigation report of Corporal Harrish of the Pennsylvania State Police. Without deciding whether the report fell within one of the exceptions to the hearsay rule, the court ruled that since the content of the report was merely cumulative of other non-hearsay evidence its admission was not a ground for a new trial. Howmet argues persuasively that the report was properly admitted under Fed.Ev.Rule 803(b). Whether or not that argument is sound, however, we agree with the trial court that the evidence is merely cumulative, and thus falls within Rule 61.
Howmet's Appeal
4
The jury verdict was for the face amount of the Hartford policy, $100,000. Howmet's evidence suggested a loss from theft during the period of coverage in excess of $124,000. Howmet moved after verdict for the entry of a judgment including interest on $100,000 from the date the suit was filed. Hartford resisted on two grounds: that under Pennsylvania law it could not be liable for any amount in excess of the policy limits; and that in any event the interest issue was not submitted to the jury. The trial court did not reach the second ground. Relying on Incollingo v. Ewing, 474 Pa. 527, 379 A.2d 79 (1977), it held that an insurer was not liable in Pennsylvania for interest in excess of the policy limit. The parties agree that Pennsylvania law controls.
5
The trial court's reliance on Incollingo is misplaced, for that case dealt with liability insurance rather than, as here, casualty insurance. Incollingo, and the case which it follows, Hafer v. Schauer, 429 Pa. 289, 239 A.2d 785 (1968), both deal with the obligation of a liability insurer to indemnify the insured for interest for which the insured becomes liable to third parties, when the total liability, including interest due by virtue of a Pennsylvania statute providing for interest after verdict, exceeds the policy limits. These cases hold that the policy limits determine the amount of the liability insurer's indemnity undertaking. They have nothing to do with the separate question whether a casualty insurer is liable for interest for wrongfully withholding contractual payments for a loss. The limits contained in such a policy establish how much of the loss is covered, but they do not authorize withholding of monies due under the contract. The common law rule is that one who owes a sum of money at a date certain is obliged to pay interest for withholding payment. Penneys v. Pennsylvania Railroad Company, 408 Pa. 276, 183 A.2d 544 (1962). That rule is applicable to insurance contracts. J. Purdy Cape Hotels Co. v. Fidelity-Phoenix Fire Insurance Co., 126 Pa.Super. 260, 191 A. 636 (1937). Even a bona fide dispute as to the amount due on the contract is no bar to the accruing of interest. West Republic Mining Co. v. Jones & Laughlin, 108 Pa. 55 (1884); Samuels v. California Ins. Co., 192 Pa.Super. 484, 162 A.2d 48 (1960); J. Purdy Cape Hotels Co. v. Fidelity-Phoenix Fire Insurance Co., supra.
6
Hartford contends that the Incollingo and Hafer cases changed the law with respect to the liability of insurance companies generally. Certainly their holdings deal only with the extent of the indemnity undertaking, and not with the common law obligation to pay interest for the wrongful withholding of sums due by virtue of that undertaking. Hartford has pointed to no Pennsylvania case suggesting that Incollingo and Hafer changed the Pennsylvania law in this respect. While the Supreme Court of Pennsylvania has not addressed the issue since Incollingo, we are confident that it would follow the lead of those cases which have drawn the distinction between interest as a part of the indemnity undertaking and interest for wrongfully withholding payment when due under a contract. Maryland Casualty Co. v. Clements, 15 Ariz.App. 216, 487 P.2d 437 (Ct.App.1971); Social Security Admin. v. Employers Mutual Liability Ins. Co. of Wisconsin, 234 Md. 493, 199 A.2d 918 (1964). See, e. g., Duffer v. American Home Assurance Co., 512 F.2d 793 (5th Cir. 1975); Fruge v. American Mutual Ins. Co., 227 So.2d 646 (La.App.1969) (awarding interest for wrongful delay in payment without discussion).
7
Hartford contends that we should nevertheless affirm the denial of interest, because Howmet failed to request that the question of interest be submitted to the jury. Howmet points out, however, that under Pennsylvania law the question of interest on sums due by virtue of a contract is one for the court, Penneys v. Pennsylvania Railroad Company, 408 Pa. 276, 183 A.2d 544 (1962), and that this rule has been followed in the federal district courts. Eastern Associated Coal Corp. v. Aetna Casualty & Surety Co., 475 F.Supp. 586 (W.D.Pa.1979). We need not determine whether the Penneys rule should invariably be followed in cases where there may be a material fact issue over when payment was due under the contract. Cf. Goodman v. Mead Johnson & Co., 534 F.2d 566, 571-72 (3d Cir. 1976), cert. denied, 429 U.S. 1038, 97 S.Ct. 732, 50 L.Ed.2d 748 (1977) (Federal courts not bound by New Jersey's rule that defense to statute of limitations is decided by judge rather than jury). In this case Howmet sought to include interest in the judgment only from the date suit was filed, and the verdict establishes that payment was due at least by that date. Thus there was no fact issue not already decided by the jury, and no reason why the court should not have entered a judgment providing for interest from the date suit was commenced.
Conclusion
8
In appeal No. 81-1780 by Howmet the judgment will be reversed and the cause remanded for the entry of a judgment including interest. In appeal No. 81-1781 by Hartford the judgment will be affirmed.
*
Hon. Barron P. McCune, United States District Judge for the Western District of Pennsylvania, sitting by designation
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537 U.S. 1097
AMERICAN GENERAL FINANCE, INC.v.PASCHEN ET UX.
No. 02-562.
Supreme Court of United States.
December 16, 2002.
1
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT.
2
C. A. 11th Cir. Certiorari denied. JUSTICE BREYER took no part in the consideration or decision of this petition. Reported below: 296 F. 3d 1203.
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398 F.Supp. 425 (1975)
William Norman RICHARDSON
v.
STATE OF MARYLAND.
Civ. A. No. 20868.
United States District Court, D. Maryland.
March 7, 1975.
*426 *427 William Norman Richardson, pro se.
Francis B. Burch, Atty. Gen., and Harry A. E. Taylor, Asst. Atty. Gen., Baltimore, Md., for respondent.
WATKINS, Senior District Judge.
William N. Richardson has a long and varied history before this Court and the courts of Maryland, so that a brief discussion of his judicial activity is particularly apropos. Petitioner, presently incarcerated in the Maryland House of Correction, was indicted for statutory burglary of a bar in violation of art. 27, § 33 of the Md. Ann. Code (1971 Repl. Vol.). After a plea of not guilty, he was convicted by a jury in the Criminal Court of Baltimore (Criminal No. 205) and sentenced on February 2, 1968, by the Honorable Charles D. Harris to a prison term of six years "consecutive with any sentence for violation of Parole." The conviction was affirmed by the Maryland Court of Special Appeals in Clark v. Maryland, 6 Md. App. 91, 250 A.2d 317 (1969). Certiorari was denied by the Court of Appeals. Richardson v. State, 254 Md. 719 (1969).
Petitioner then began submitting habeas corpus petitions to this Court, which now total three. In the first one, among several allegations of constitutional infringements at trial,[1] the Petitioner asserted that he had been illegally arrested (and thus that tainted evidence, seized pursuant to the arrest, had been improperly admitted into evidence). This is the only issue presently under consideration. Relying on Fay v. Noia, 372 U.S. 391, 438-40, 83 S. Ct. 822, 9 L. Ed.2d 837 (1963), and Sanders v. United States, 373 U.S. 1, 17-18, 83 S. Ct. 1068, 10 L. Ed.2d 148 (1963), this Court rejected Petitioner's contention, since he did not object to the introduction of evidence at the time of his original trial; and since he failed to state what items, if any, were seized and thereafter improperly admitted into evidence contrary to the Fourth Amendment. Richardson v. Warden, Civil Action No. 20868W (D. Md. June 17, 1969) (unpublished memorandum opinion and order). The second habeas corpus petition once again questioned the admissibility of the evidence,[2] but the petition was similarly denied on the authority of Noia and Sanders, and also because Petitioner *428 was then appealing the first decision of this Court to the Fourth Circuit Court of Appeals. Richardson v. Warden, Civil Action No. 20868W (D. Md. Nov. 26, 1969) (unpublished memorandum opinion and order).
On appeal to the Fourth Circuit, that court dismissed Petitioner's first petition without prejudice due to his failure to exhaust state remedies under the Maryland Post Conviction Procedure Act, Md. Ann. Code art. 27, § 645A et seq. (1974 Cum. Supp.). Richardson v. Warden, Civil Action No. 13,690 (4 Cir. April 22, 1970) (unpublished memorandum decision).
Pursuant to the recommendation of the Fourth Circuit, Petitioner filed under the Maryland Post Conviction Procedure Act in the Criminal Court of Baltimore, and on June 5, 1970, a hearing was held before the Honorable George D. Solter. Counsel was appointed to represent Petitioner, and a "Supplemental Petition" was submitted by his attorney. Judge Solter denied Petitioner's Application of Post Conviction Relief for the reasons stated in his unpublished memorandum opinion of August 21, 1970. Richardson v. Warden, P.C.P.A. No. 1959. In an unreported opinion and order filed January 15, 1971, the Court of Special Appeals denied Petitioner's appeal from Judge Solter's decision.
A third habeas corpus petition was submitted by Petitioner in which he once again asserted that tainted evidence had been improperly admitted during trial.[3] This Court disposed of that contention in Richardson v. Warden, Civil Action No. 20868W (D. Md. June 4, 1973) (Order to Show Cause), by reference to the principle of res judicata, and passed judgment adverse to Petitioner on the remaining viable allegation. Richardson v. Warden, Civil Action No. 20868W (D. Md. July 5, 1973) (unpublished memorandum opinion and order).
Petitioner appealed this Court's decision concerning the third habeas corpus petition to the Fourth Circuit. The Court of Appeals reversed in part due to this Court's failure to consider the legality of Petitioner's arrest on the merits, saying:
Richardson, however, had exhausted his state remedies in the interim between this court's dismissal of his alleged illegal arrest claim on appeal and the filing of the habeas corpus petition now under review. It was error, therefore, for the court not to address this claim on the merits. Accordingly, we remand to the district court for a determination of the legality of the arrest, and, in accordance with our policy of liberal construction of prisoner's petitions, to determine if there were any collateral consequences of a constitutional nature resulting from any illegal arrest procedures.
Richardson v. Warden, No. 73-1981 (4 Cir. Feb. 14, 1973) (unpublished memorandum decision).
DISCUSSION OF THE FACTS[4]
In order to determine the legality of the arrest and the admissibility of the seized evidence, a brief recital of the facts leading up to the arrest is necessary.
At approximately 2:30 a. m. on October 30, 1967, Officer Earl Gillespie *429 of the Southwestern District of the Baltimore City Police Department was approached by a private citizen who complained of excessive noise at his apartment complex on 1821 West Pratt Street. (Transcript 14, 48). The officer went to an apartment where a party was taking place, knocked and after the door was opened, requested the ten to fifteen occupants to quiet down. (Tr. 15, 49). While there, the officer noticed the Petitioner; a James R. Clark, Petitioner's co-defendant at trial; and at least one or two women presumably the remaining people were men. (Tr. 15, 48). In addition, the officer observed a number of quart beer bottles and beer cans spread throughout the kitchen and the two other small rooms of the apartment, but saw no alcoholic beverages other than beer. (Tr. 15-16, 48).[5]
Subsequently, the officer returned to the same apartment to talk with a Melvin Henson after receiving a second complaint from another private citizen (Tr. 40-41)[6] to the effect that Henson and two other white males were surreptitiously carrying packages from a neighboring car lot to the apartment complex across the street when no cars or people were in sight. (Tr. 40-41). During this second visit to the apartment between 4:00 a. m. and 5:15 a. m., the police officer noticed, from a distance of six to eight feet (Tr. 56), that twenty-five to forty bottles of alcohol were neatly stacked against the kitchen wall. (Tr. 18, 42, 55, 58). On the labels of each visible bottle of alcohol were large letters or numerals (Tr. 18) written in blunt black crayon. (Tr. 20, 47, 55-56). The officer asked the group of occupants, which had now slimmed down to about eight people (Tr. 17, 45), to whom the alcohol belonged. Clark replied that it was his, that he bought it. (Tr. 18, 42). At this time the officer believed he saw Petitioner sitting on a kitchen chair next to the stolen alcohol. (Tr. 59, 33).[7]
The officer left and shortly thereafter proceeded to the Mount Cafe bar, 1701 Frederick Avenue, Baltimore, Maryland, approximately a block and one-half from the apartment, after learning from a police radio-phone call that there was serious trouble at that location. (Tr. 43). Upon arriving he was informed that a large quantity of alcohol had been stolen and saw that all the remaining bottles of alcohol had black crayon markings on the labels, similar to those which he had observed at the apartment on his second visit. (Tr. 44).
Correlating the present incident with what he had seen earlier (Tr. 43-44), the officer returned to the apartment at approximately 6:15 a. m. to "stake it out" until his superior could complete the burglary investigation at the bar. (Tr. 51). At 6:30 a. m. or 6:15 a. m. the Petitioner and Clark started to come out of the apartment. (Tr. 44, 52, 24). *430 One of them, probably the Petitioner (Tr. 52, 37-38),[8] was carrying in his sport coat pocket a half-pint of "Pikesville" whiskey (Tr. 44) on which there were black crayon markings (Tr. 10, 44-45, 54). The two were told to re-enter the dwelling, since they and everyone in the apartment were being arrested[9] and ". . . held for investigation of burglary."[10] (Tr. 45, 51-52). Fifteen minutes later the police sergeant arrived. A warrantless search of the apartment produced only four bottles of alcohol, all of which had black crayon markings on the labels (Tr. 10); cigars of the same brand as ones stolen from the bar; and a jar of hot sausages, apparently similar to a jar stolen from the bar. (Tr. 45-46). At that point, Petitioner (a white man), Clark (a white man), three other white men and three women were taken down to the Southwest Police Station for questioning. (Tr. 53).
During the trial, after being recalled, Officer Gillespie further testified that a warrant had been issued for Melvin Henson's arrest, but that he had not been apprehended yet. Additionally, the officer mentioned that June Cowan, the hostess of the party, probably had been charges with possession of stolen goods. (Tr. 98-99).
The only physical evidence introduced at trial was the four bottles of alcohol, all of which were marked with a blunt black crayon. Three of the bottles were seized from the apartment, while the fourth one, the Pikesville, was taken from the Petitioner (or perhaps Clark). (Tr. 10, 45-46, 54). The cigars and the jar of sausages which the police officer referred to during his testimony were not introduced into evidence.[11]
LEGAL DISCUSSION
Introduction:
It should be noted at the outset that Petitioner has "standing" to contest the alleged illegal search and seizure. Mancusi, Warden v. DeForte, 392 U.S. 364, 88 S.Ct. 2120, 20 L.Ed.2d 1154 (1968); Jones v. United States, 362 U.S. 257, 80 S.Ct. 725, 4 L.Ed.2d 697 (1960).
From a review of the trial transcript and the Post Conviction opinion of Judge Solter, it is clear that the standard of Townsend v. Sain, 372 U.S. 293, 313, 83 S.Ct. 745, 9 L.Ed.2d 770 (1963) has been met and that a plenary evidentiary hearing is not mandated, nor *431 even advisable. Since the crucial facts of this case were largely uncontested, with the exception of some dispute as to who possessed the bottle of Pikesville, the merits of all factual disputes have been resolved. Additionally, the State factual determination is fully supported by the record as a whole, and the factfinding procedures employed by the State provided Petitioner with a full and fair hearing in which all material facts were fully developed. Consequently, the factual determinations of the State are adopted. Townsend v. Sain, supra at 318, 83 S.Ct. 745. See also, Heisler v. Cox, 431 F.2d 581, 582-84 (4 Cir. 1970); Thornhill v. Peyton, 420 F.2d 477, 478 (4 Cir. 1969); Ladd v. South Carolina, 415 F.2d 870, 872-73 (4 Cir. 1969), cert. denied, 397 U.S. 1049, 90 S. Ct. 1384, 25 L.Ed.2d 663 (1970); Hamric v. Bailey, 386 F.2d 390, 393 (4 Cir. 1967); Stevens v. Warden, 366 F.2d 565, 568-69 (4 Cir. 1966), cert. denied, 385 U.S. 1031, 87 S.Ct. 765, 17 L.Ed.2d 679 (1967).
This Court holds that the evidence introduced during Petitioner's trial was properly admissible. The opinion will first discuss the existence of probable cause for the arrest, and next consider the "reasonableness" of the subsequent search and seizure. Finally, the officer's "plain view" of the Pikesville whiskey, and the potential error in the introduction of the other three bottles of alcohol will be scrutinized.
Probable Cause for the Arrest:
From the facts of this case, one colorable argument that the Petitioner could raise is that the items seized from the search of the apartment ware inadmissible because the police did not have a warrant. Such a proffer could rest on Agnello v. United States, 269 U.S. 20, 33, 46 S.Ct. 4, 6, 70 L.Ed. 145 (1925), where the Supreme Court classically reiterated the general rule regarding warrantless searches and seizures:
Belief, however well founded, that an article sought is concealed in a dwelling house, furnishes no justification for a search of that place without a warrant. And such searches are held unlawful notwithstanding facts unquestionably showing probable cause.
See also, Coolidge v. New Hampshire, 403 U.S. 443, 451, 91 S.Ct. 2022, 29 L. Ed.2d 564 (1971); Jones v. United States, 357 U.S. 493, 497-98, 78 S.Ct. 1253, 2 L.Ed.2d 1514 (1957); Johnson v. United States, 333 U.S. 10, 14-15, 68 S.Ct. 367, 92 L.Ed. 436 (1948).
The purpose of this rule is to ensure the right to privacy guaranteed by the Fourth Amendment. Warden v. Hayden, 387 U.S. 294, 304, 87 S.Ct. 1642, 18 L.Ed.2d 782 (1967); Jones v. United States, 362 U.S. 257, 266, 80 S.Ct. 725, 4 L.Ed.2d 697 (1960). In comparing the relative importance of Fourth (and Fifth) Amendment rights with other constitutional guarantees, the Court has commented:
. . . such rights are declared to be indispensable to the "full enjoyment of personal security, personal liberty and private property" . . . they are to be regarded as the very essence of constitutional liberty . . . .
Gouled v. United States, 255 U.S. 298, 303-04, 41 S.Ct. 261, 263, 65 L.Ed. 647 (1921). In fact, as early as 1886 the Supreme Court expressed concern over encroachment upon the Fourth Amendment, advising all lower courts against any close and literal construction which might emasculate the purpose of the Amendment. Boyd v. United States, 116 U.S. 616, 635, 6 S.Ct. 524, 29 L.Ed. 746 (1886).
There are, however, some "specifically established and well-delineated exceptions" to this general rule. Coolidge, supra, 403 U.S. at 455, 91 S.Ct. 2022. One of the most historic and recurrent exceptions is that a warrantless search and seizure may be conducted incident to a lawful arrest. See, e. g., Weeks v. United States, 232 U.S. 383, 392, 34 S. Ct. 341, 58 L.Ed. 652 (1914); Carroll v. United States, 267 U.S. 132, 158, 45 S. Ct. 280, 69 L.Ed. 543 (1925); Agnello, *432 supra, 269 U.S. at 30, 33, 46 S.Ct. 4; Marron v. United States, 275 U.S. 192, 198-99, 48 S.Ct. 74, 72 L.Ed. 231 (1927).
In the instant case the Petitioner alleges that his warrantless arrest was illegal. Thus, it must be determined whether or not the police acted with "probable cause." Solely for the purpose of this part of the opinion, it should be assumed that, if probable cause were lacking, the search and seizure were illegal; accordingly, the evidence would be tainted and inadmissible at trial.
Maryland's law regulating warrantless arrests must be examined, since the law of the state where the arrest took place governs. Cf. United States v. Di Re, 332 U.S. 581, 589, 68 S.Ct. 222, 92 L.Ed. 210 (1948); Johnson v. United States, 333 U.S. 10, 15 n. 5, 68 S.Ct. 367, 92 L.Ed. 436 (1948). Subsection (c) of art. 27, § 594B of the Md. Ann. Code (1971 Repl. Vol.), which is merely declaratory of existing common law, states:
A police officer may arrest a person without a warrant if he has probable cause to believe that a felony has been committed or attempted and that such person has committed or attempted to commit a felony whether or not in his presence or view.
See, Shorey v. Warden, Maryland Penitentiary, 401 F.2d 474, 477 (4 Cir. 1968); Richardson v. Snow, 340 F. Supp. 1261, 1263 (D. Md. 1972); Hebron v. State, 13 Md.App. 134, 146, 281 A.2d 547 (1971).
In Hebron v. State, 13 Md. App. 134, 146, 149, 281 A.2d 547, 553, 555 (1971), the Maryland Court of Special Appeals aptly defined "probable cause":
Ordinarily it exists when the facts and circumstances within the knowledge of the arresting officer, or of which he had reasonably trustworthy information, are sufficient to warrant a reasonably cautious person in believing that a crime had been committed by the person arrested. The rule of probable cause is a non-technical conception of a reasonable ground for belief of guilt, requiring less evidence for such belief than would justify conviction, but more evidence than that which would arouse a mere suspicion. Only the probability and not a prima facie showing, of criminal activity is the standard for probable cause.
* * * * * *
. . . in dealing with probable cause we deal with probabilities. These are not technical; they are factual and practical considerations of every day life on which reasonable and prudent men, not legal technicians, act. The standard of proof is accordingly correlative to what must be proved. Radcliffe v. State, 6 Md. App. 285 [251 A.2d 11]. Compare Brown v. State, 5 Md. App. 367 [247 A.2d 745].
In somewhat the same language, the Fourth Circuit has commented:
The existence of "probable cause" is to be determined by the application of a practical, not a technical, standard. The meaning of the phrase has been so frequently stated as to require little elaboration here. Probable cause is something more than mere suspicion and something less than evidence which would justify a conviction. The essence of all definitions of probable cause for arrest is reasonable ground for belief that a crime has been committed and the person arrested committed it.
* * * * * *
No single litmus-paper test will provide the answer when probable cause is at issue; we look instead to the totality of the circumstances. And the pertinent circumstances are those of the moment, the actual ones, the ones that confronted the arresting officers. Officers patrolling the street at night do not prearrange the setting and they cannot judge events in the calm of an office. Things just happen, and as they happen the officers must choose to act or not. Our inquiry is *433 whether their action was that of reasonable and prudent police officers in view of the circumstances as they appeared at the time of arrest. [emphasis added; footnotes and citations omitted].
Ralph v. Pepersack, 335 F.2d 128, 132 (4 Cir. 1964). For similar definitions, see, e. g., Beck v. State of Ohio, 379 U.S. 89, 91, 85 S.Ct. 223, 13 L.Ed.2d 142 (1964); Ker v. California, 374 U.S. 23, 35, 83 S. Ct. 1623, 10 L.Ed.2d 726 (1963); Henry v. United States, 361 U.S. 98, 102, 80 S. Ct. 168, 4 L.Ed.2d 134 (1959); Brinegar v. United States, 338 U.S. 160, 175-76, 69 S.Ct. 1302, 93 L.Ed. 1879 (1949); Carroll v. United States, 267 U.S. 132, 156, 162, 45 S.Ct. 280, 69 L.Ed. 543 (1925); United States v. Peisner, 311 F.2d 94, 104 (4 Cir. 1962).
This Court finds that the circumstances in the early morning hours of October 30, 1967, were such as to give a reasonable, cautious and prudent man probable cause to arrest the Petitioner. In fact, as Judge Solter mentioned in his Post Conviction opinion, ". . . it is difficult to imagine a more classic case for the belief that a felony had been committed and that the Petitioner and his co-defendant had participated in the commission of the felony." Richardson v. Warden, P.C.P.A. No. 1959 at 3 (Criminal Court of Baltimore, Aug. 21, 1970) (unpublished memorandum opinion and order).
Returning to the facts, the police officer noticed during the initial visit to the apartment that beer cans were spread throughout, but did not see any alcohol other than beer. Officer Gillespie then received a report from a private citizen that Melvin Henson and two white males: ". . . had been carrying packages across . . . Pratt Street, ducking into 1821 [the apartment complex where the arrest took place] when there was no traffic, no one seen on the street. They would wait and run into the alleyway with the packages . . . ." (Tr. 40). He returned to the apartment in question to see twenty-five to forty bottles of liquor on the kitchen floor, each visible bottle having large letters or numerals written on the labels in blunt black crayon.
It was certainly "unusual" that all of the bottles had large black numerals or letters inscribed on the labels. It was "somewhat suspicious" that there was such a large quantity of hard alcohol for the use of such a small number of people. It was "very suspicious" that the large quantity of liquor had suddenly appeared between 2:30 a. m. and 5:15 a. m. when most bars and liquor stores were closed. However, it was more than merely "very suspicious," considering the police's accumulated knowledge, that Henson and the two white males should be so concerned about being seen at 4:00 in the morning as they attempted to cross Pratt Street.
This Court, nevertheless, does not have to determine whether the police had probable cause to arrest Petitioner during the second visit. The arrest was not then made. Two other things furnished the police with additional and maybe unnecessary facts which support the existence of probable cause: (1) the "plain view" sighting of the bottle of Pikesville in Petitioner's (or Clark's) possession, and (2) the knowledge that a felony had been committed.
If Petitioner were the one the police officer saw with the Pikesville whiskey, there is a great deal of legal significance to this observation. It is well-settled in Maryland that, absent a satisfactory explanation, exclusive possession of recently stolen goods permits the trier of the facts to draw an inference strong enough to sustain a conviction that the possessor was either the thief, or the receiver of the stolen goods. See, e. g., Anglin v. State, 244 Md. 652, 656-63, 224 A.2d 668 (1966), cert. denied, 386 U.S. 947, 87 S.Ct. 984, 17 L.Ed.2d 877 (1967) (housebreaking); Howard v. State, 238 Md. 623, 624, 209 A.2d 604 (1965) (burglary); Stapf v. State, 230 Md. 106, 108, 185 A.2d 496 (1962) (larceny); Boggs v. State, 228 *434 Md. 168, 172, 179 A.2d 338 (1962) (receiving stolen goods); Ponder v. State, 227 Md. 570, 572, 17 A.2d 839 (1962) (burglary); Lewis v. State, 225 Md. 474, 475-76, 171 A.2d 244 (1961) (burglary and larceny); Booker v. State, 225 Md. 183, 186, 170 A.2d 203 (1961) (armed robbery); Glaros v. State, 223 Md. 272, 280, 164 A.2d 461 (1960) (larceny); Butz v. State, 221 Md. 68, 77-78, 156 A.2d 423 (1959) (burglary); Jordan v. State, 219 Md. 36, 46, 148 A.2d 292, cert. denied, 361 U.S. 849, 80 S.Ct. 105, 4 L.Ed. 2d 87 (1959) (receiving stolen goods); Felkner v. State, 218 Md. 300, 304-05, 146 A.2d 424 (1958) (burglary). The Supreme Court has consistently upheld the drawing of such an inference. For example, in Wilson v. United States, 162 U.S. 613, 619, 16 S.Ct. 895, 898, 40 L.Ed. 1090 (1896), the Court stated:
Possession of the fruits of crime, recently after its commission, justifies the inference that the possession is guilty possession, and, though only prima facie evidence of guilt, may be of controlling weight unless explained by the circumstances or accounted for in some way consistent with innocence. [citations omitted].
See also, United States v. Gainey, 380 U.S. 63, 85 S.Ct. 754, 13 L.Ed.2d 658 (1965); Casey v. United States, 276 U. S. 413, 48 S.Ct. 373, 72 L.Ed. 632 (1928); Yee Hem v. United States, 268 U.S. 178, 45 S.Ct. 470, 69 L.Ed. 904 (1925); McNamara v. Henkel, 226 U.S. 520, 33 S.Ct. 146, 57 L.Ed. 330 (1913); United States v. Ballard, 449 F.2d 782 (4 Cir. 1971); United States v. Williams, 405 F.2d 14 (4 Cir. 1968).
Logically it would seem that, if possession of recently stolen goods can give rise to an inference which directly results in conviction, then possession of such goods provides all the requisite "probable cause" for the warrantless arrest of the Petitioner. As stated above, "probable cause" does not require evidence which would be sufficient to convict, but merely enough facts to form a reasonable ground for the belief that Petitioner was guilty. Ralph v. Pepersack, 335 F.2d 128, 132 (4 Cir. 1964); Hebron v. State, 13 Md.App. 134, 136, 281 A.2d 547 (1971).
Even if the Petitioner were not the man who had the liquor bottle protruding from his sport coat pocket, this Court still concludes that Petitioner's presence during the "plain view" observation of the Pikesville has legal significance. It should be recalled that during his second visit Officer Gillespie believed he saw Petitioner sitting in the kitchen of the apartment close to the stolen alcohol. (Tr. 59, 33). Also, the policeman believed that Petitioner (and not Clark) was the one with the Pikesville in his coat pocket. In each case, although it may not have been conclusively established that Petitioner was in "exclusive possession" of the liquor, the police could draw an inference of guilt or complicity from these "plain view" sightings, even though a jury, on these facts alone, might fail to convict. Accordingly, due to Petitioner's recurrent proximity to the stolen alcohol and his companionship with the man who claimed he "bought" what later turned out to be stolen alcohol, this Court finds that, in light of all the other circumstances, the police had reasonable grounds to believe that Petitioner had committed the felony in question. See, e. g., Park v. Huff, 506 F.2d 849 (5 Cir. 1975).
Assuming that the police officer never viewed the bottle of Pikesville whiskey, it is just as clear to this Court that a reasonable, cautious and prudent individual had probable cause to arrest the Petitioner and detain all other individuals in the apartment after discovering the burglary and the presence of the twenty-five to forty marked bottles. When Officer Gillespie determined that the Mount Cafe bar had been burglarized, he had probable cause to believe that a felony had been committed, i. e., that there had been a statutory burglary of a shop or storeroom in violation of art. 27, § 33 of the Md. Ann. Code (1971). Possessed with the knowledge *435 that the first test of the warrantless arrest statute and the common law had been met, the officer needed only to have probable cause to believe that Petitioner had committed the felony in order to effect a valid warrantless arrest.
Aside from the markings, the appearance of the large quantity of liquor during the early morning hours, and the secretive activity of three occupants of the apartment, at the time of the arrest the police possessed the additional knowledge that there had been a felonious burglary of liquor bottles, which had black markings on the labels similar to those observed in the apartment. The police believed, and not unreasonably, that the felons and the stolen property had been and might still be located at the apartment in question. Additionally, the discovery of the felony greatly enhanced the reliability of the private citizen who reported the surreptitious undertakings of the three white males.
At trial, Petitioner's counsel argued that the police had no probable cause to arrest the Petitioner since they did not know the exact identity of the white male felons. On the facts of the present case this argument, however, is meritless. If the police had probable cause to believe that three of the white male occupants of the apartment were principals in the burglary of the bar, it was reasonable and entirely conceivable that others in the apartment were feloniously involved, possibly as aiders, abettors or co-conspirators. See generally, Scales v. United States, 367 U.S. 203, 81 S.Ct. 1469, 6 L.Ed.2d 782 (1961); Nye & Nissen v. United States, 336 U.S. 613, 69 S.Ct. 766, 93 L.Ed. 919 (1949).
There is a surprising dearth of authority on the validity of arresting a group of people when the police know for certain that only some members of a group have committed a felony. See, e. g., Thompson v. State, 15 Md. App. 335, 290 A.2d 565 (1972). Of those cases known to this Court, most seem to support the validity of the arrest in the instant case. Others, which at first blush might seem to prohibit such an arrest, are clearly distinguishable on the facts or the law. In fact, some of the blatantly distinguishable cases, in reality, support the validity of the arrest in question.
The best expression of the general rule of law concerning conspiracy and association with criminals was enunciated in United States v. Di Re, 332 U.S. 581, 593, 68 S.Ct. 222, 228, 92 L.Ed. 210, 219 (1948), where the Court stated:
The argument that one who "accompanies a criminal to a crime rendezvous" cannot be assumed to be a bystander, forceful enough in some circumstances, is farfetched when the meeting is not secretive or in a suspicious hide-out but in broad daylight, in plain sight of passersby, in a public street of a large city, and where the alleged substantive crime is one which does not necessarily involve any act visibly criminal. * * * Presumptions of guilt are not lightly to be indulged from mere meetings.
In that case, there was no evidence that the defendant was present when the overt criminal act took place, or that he heard or took part in any conversation. In fact, the informant who participated in the criminal acts did not even testify at trial concerning the defendant's guilty knowledge. Additionally, it was not shown that the defendant, even if he had been present when the contraband passed hands, had any way of knowing that the items were contraband.
Comparing the instant case with those facts which the Court in Di Re felt were important, there is direct and circumstantial evidence here which gives rise to a reasonable inference that the Petitioner and others in the apartment had knowledge of, or participated in, the burglary of the bar. First, the Petitioner was present in the apartment during the policeman's first and second visits, and thus was probably there when the stolen alcohol was brought into the apartment. Second, Petitioner was a white male, *436 thereby matching the description given by the private citizen who reported the secretive activities of the three white males carrying the packages into the apartment. Third, at the time of the second visit, Petitioner was sitting in the kitchen, very close to the stolen alcohol. (Tr. 59, 33). Fourth, it is reasonable to believe that anyone who was aware of the newly found alcohol might have asked or heard a discussion as to how and why it appeared. After all, the provider had made a very magnanimous gesture in furnishing the alcohol, and it had appeared at an unusual hour, with unusual markings. Fifth, the Petitioner had started to leave the apartment in the company of the man (another white male) who alleged that he had "bought" what turned out to be stolen alcohol. Sixth, unlike Di Re, it did not take an expert witness to identify the contraband as stolen property. Indeed, after discovering the burglary, the police knew from a prior cursory look that the alcohol was stolen property. Seventh, the carrying of the packages across Pratt Street was very secretive and suspicious, totally unlike the factual situation facing the Court in Di Re. Considering the critical facts of the present case as emphasized in Di Re, and other facts known by the police, it appears that the general rules laid down by the Supreme Court establish that probable cause for Petitioner's arrest existed here due to his association with and relationship to the crime and the criminals.
There are two cases dealing with conspiracy and probable cause for arrest which are relevant to the discussion. Both cases found that there was no probable cause for arrest, but both are distinguishable. In Banks v. Pepersack, 244 F.Supp. 675, 677-78 (D. Md. 1965), Judge Northrop, now Chief Judge of this District, found that "[t]he primary reason for the arrest was that Banks [the defendant] was a known narcotics addict and was found on the premises during the [drug] raid." Additionally, the testimony clearly indicated that "[t]he officers had no information concerning Banks' and were in fact surprised to find him there." Clearly, Banks is distinguishable from the instant case on its facts, since the police were anything but surprised to find the Petitioner at the apartment, and since, for reasons stated above in the Di Re discussion, the Petitioner was not arrested merely because he was present.
Banks is distinguishable from a legal standpoint also. Apparently the government attempted to justify the arrest of Banks on the theory that possession of narcotics is a misdemeanor for which no warrant is required in order to effect a valid arrest. However, under Maryland law a warrantless arrest may be made only if a misdemeanor is committed in the presence of an officer. Md. Ann. Code art. 27, § 594B (a) and (b) (1971). According to Judge Northrop, Banks did not commit a misdemeanor in the presence of the police, and thus the warrantless arrest was illegal. In the instant case, the police arrested the Petitioner for commission of a felony; consequently, part of the holding of Banks is inapposite to the case in question.
The second case relevant to this discussion is United States v. Vigo, 357 F. Supp. 1360 (S.D. N.Y.1972). There, Vigo and two other individuals were unknowingly under police surveillance while at a bar. According to a reliable informant, Vigo and the others were going to leave the bar in an effort to return some heroin to the supplier. The three individuals did in fact leave the bar, went to a housing project to pick up a woman by the name of Pagan, and then proceeded to drive around, stopping at several bars. Once it appeared to police that the car was going no particular place, the police stopped the car and arrested all four occupants. Under these circumstances, the court held:
While the agents had probable cause to believe that defendant Vigo was committing violations of the federal narcotics laws and that contraband was located in his car, they had no probable cause to believe that defendant Pagan was involved in that criminal *437 activity. Therefore, her arrest was unlawful and the search [and seizure] of her purse cannot be upheld as being incident to her arrest.
Vigo, supra at 1365.
It is clear to this Court that Pagan had done nothing, other than being present with suspected felons, which would even cause the police to be suspicious. On the other hand, if as in the instant case the police had reliable information that a white woman was the supplier, and police had previously seen her in plain view of a white powder, and if she were present, at the scene before and after the white powder had appeared, then the result in Vigo would have been entirely different.
Another case deserves mentioning, primarily because it is well-known and bears, by analogy, some relevance to the case in question. In Johnson v. United States, 333 U.S. 10, 68 S.Ct. 367, 92 L. Ed. 436 (1948), government agents were told by an informant that unknown persons were smoking opium in a hotel. Later the informant called to say that he had actually smelled it burning. Four experienced narcotics agents then went to the room where the recognizable odor was coming from, knocked and asked to be admitted. After some conversation between Johnson and the agents through an open door, the defendant was informed that she was under arrest and that a search was going to be conducted. As expected, the agents recovered incriminating opium and a warm smoking apparatus. In discussing the illegality of the arrest, the Court based its opinion on the government's admission that the agents did not have probable cause to arrest Johnson because they did not know who was present in the room.
The facts of the present case, needless to say, are plainly distinguishable. Here, during all three visits to the apartment, Officer Gillespie specifically noticed the Petitioner. Clearly, the police did not have to enter the Pratt Street apartment to know who the occupants were. Johnson is also distinguishable for a second reason. As pointed out in United States v. Burruss, 306 F. Supp. 915, 919 (E.D. Pa.1969):
The [Johnson] Court clearly stated that the arrest there was not based upon other reliable information apart from the identity of the defendant.
As shown earlier, there is clearly other very credible information which the police relied upon as a basis for probable cause for the arrest. Indeed, considering the facts of Johnson and the rules it set forth, this Court believes that Johnson does not have to be distinguished from the instant case, because it supports the arrest herein.
Likewise, United States v. Vilhotti, 452 F.2d 1186 (2 Cir.), rev'g in part, 323 F. Supp. 425 (S.D. N.Y.1971), after careful analysis, would seem to validate the arrest of Petitioner. Based upon an informant's tip, federal and state agents staked out a warehouse in which they believed that recently stolen merchandise was being stored until sale. About 9:00 a. m. one morning, Vilhotti, Mercurio and Santa arrived at the warehouse and were arrested while inside the garage in "plain view" of numerous stolen goods. Shortly thereafter, a fourth person by the name of Maloney arrived, and he too was immediately arrested when he knocked on the garage door. At trial, no additional evidence was introduced as to Mercurio's and Santa's complicity, but it was shown that Maloney had in his possession on arrest a list of the stolen property which had been removed from the garage and money sufficient to pay for the removed goods. As to Vilhotti, there was evidence to the effect that he had been seen in the vicinity of the garage on two or three other occasions, and that he probably had a key to the garage. In summing up the facts and reaching its conclusion, the lower court found that there was probable cause for Mercurio's and Santa's arrest.
The circumstances of these arrests certainly support, at the very least, an inference of knowledge on the part of *438 Santa and Mercurio of the criminal enterprise in which Vilhotti was then engaged. Santa and Mercuiro were not simply in the presence of a known criminal. They were in the company of a key suspect on highly suspicious premises at the time when illicit dealings, likely to involve a number of persons, were expected. Indeed, they were arrested in plain view of the stolen merchandise sought to be suppressed. While Kelly's [the police officer's] knowledge of Santa's past criminal involvements lent further support to his suspicion, the circumstances alone afforded probable cause to arrest. Mercurio's arrest, therefore, was not any less warranted. An officer need not know the identity of a person to have probable cause for arrest. United States v. Llanes, supra, 398 F.2d [880] at 883 [2 Cir. 1968].
The Second Circuit reversed Mercurio's and Santa's conviction, but not because the police lacked probable cause to arrest the two:
We hold that the mere presence of Santa and Mercurio in the garage is insufficient as a matter of law to establish either actual or constructive possession.
* * * * * *
The absence of any evidence, apart from their mere presence, to support the government's contention that Santa and Mercurio knew that the stolen goods were in the garage, similarly requires a reversal of their conviction on the conspiracy count. [emphasis added].
Vilhotti, supra at 1188-89.
From the above quoted language it is apparent that the Second Circuit is not attacking the existence of probable cause for Mercurio and Santa's arrest, but is attacking the sufficiency of the evidence, as a matter of law, to convict the two. This fact is revealed in the court's discussion of Maloney's conviction: "We find ample evidence to support Maloney's conviction as a principal . . . ." Id. at 1188. By implication, for the court to find that Maloney's conviction was valid, the Second Circuit was required to find that Maloney's mere presence in such a suspicious setting provided sufficient probable cause for his arrest. Without reiterating the facts of the present case again, it should be apparent from a comparison of the two cases that the police here had much more reason to suspect guilt or complicity than did the government agents in Vilhotti. See also, United States v. Steward, 451 F.2d 1203 (2 Cir. 1971); United States v. Kearse, 444 F.2d 62 (2 Cir. 1971); United States v. Casalinuovo, 350 F.2d 207 (2 Cir. 1965).
When all is said and done, the question is very simple: Did the police act reasonably in believing that the Petitioner committed a felony? If their belief was reasonable, the arrest was legal.
Considering all the facts and surrounding circumstances during the early morning hours of October 30, 1967, this Court concludes that the police had the right to detain all of the occupants of the apartment, at least in order to question them concerning the burglary. Such a detention constitutes an arrest according to, e. g., Terry v. Ohio, 392 U.S. 1, 88 S.Ct. 1868, 20 L.Ed.2d 889 (1968),[12] but it would seem that there was no other alternative. Needless to say, the police could not have conducted an effective investigation in the instant case, or hardly any other case for that matter, if they were required to interview a suspect while the potential felon walked down the street to his car or his own residence. Nor does this Court consider that an arrest warrant was practical or necessary under the circumstances. If the police had attempted to get a warrant for the arrest of Petitioner, it could not have been obtained in time because Officer Gillespie, who was *439 on the "stake out," would have had to detain and thus arrest the Petitioner when he attempted to leave the apartment. The officer could not have permitted the Petitioner to leave because of the danger that Petitioner might flee or go into hiding. The reasonableness of the officer's conduct is borne out by the fact that Melvin Henson, the third white male involved in the burglary of the bar, had still not been located at the time of trial. Additionally, it was imperative that the police restrain the activities of those in the apartment to some extent so as to prohibit the destruction of the fruits of the crime. Although bottles of alcohol are not as easily disposed of as, for example, heroin, they can be transported to another location, or broken and flushed down the toilet. Indeed, the facts of the case support the reasonableness of the police's relatively quick action, i. e., only four of the twenty-five to forty bottles seen by Officer Gillespie during his second visit were recovered. At some point between 4:00 a. m. and 5:30 a. m. there had been the disposition of a large quantity of liquor.
The "Reasonableness" of the Search and Seizure:
As discussed above, normally a warrantless search and seizure is illegal unless it falls within one of the specifically delineated exceptions of the general rule. These exceptions exist because the Fourth Amendment does not prohibit all searches and seizures, only those which are "unreasonable." In the instant case, since the arrest was legal, the police could validly search the apartment and seize the fruits or instrumentalities of the crime.
Despite their authority to conduct a warrantless search and seizure in this case, the extent to which the police could search and seize was circumscribed. The purpose of such a limitation, which has been set forth in numerous Supreme Court decisions, is to prevent general, exploratory searches. Just because a person has been legally arrested does not mean that he loses all Fourth Amendment rights to privacy of person and property.
Accordingly, the Supreme Court has specified what does and what does not run afoul of the Fourth Amendment prohibition against "unreasonable" searches and seizures. As shall be explained below in more detail, initially the Supreme Court held that a warrantless search and seizure incident to a lawful arrest need only be "reasonable." Later, in Chimel v. California, 395 U.S. 752, 89 S.Ct. 2034, 23 L.Ed.2d 685 (1969), the Court altered the standard, in effect redefining the meaning of "reasonable," because it felt that the old standard permitted too many of the forbidden exploratory searches. Henceforth, the new criterion was to be that warrantless searches incident to valid arrests must be limited to the arrestee's person and the "area within his immediate control."
The Chimel standard, however, is not to be applied retroactively. Williams v. United States, 401 U.S. 646, 651, 91 S. Ct. 1148, 28 L.Ed.2d 388 (1971); Hill v. California, 401 U.S. 797, 802, 91 S.Ct. 1106, 28 L.Ed.2d 484 (1971). This is true whether the conviction involving a particular search and seizure is on direct appeal, or is being collaterally attacked. Williams, supra, 401 U.S. at 656, 91 S.Ct. 1148; Hill, supra, 401 U.S. at 802, 91 S.Ct. 1106. Thus, all searches and seizures conducted prior to the date Chimel was handed down (June 23, 1969) are governed by pre-Chimel law.
Because the search in the present case took place on October 30, 1967, it is clear that pre-Chimel law controls. At first glance, however, it is not so apparent what the law was prior to Chimel. The cases of Harris v. United States, 331 U.S. 145, 67 S.Ct. 1098, 91 L.Ed. 1399 (1947), and United States v. Rabinowitz, 339 U.S. 56, 70 S.Ct. 430, 94 L. Ed. 653 (1950), appear to epitomize the *440 pre-Chimel law. On the other hand, Go-Bart Importing Co. v. United States, 282 U.S. 344, 51 S.Ct. 153, 75 L.Ed. 374 (1931), and United States v. Lefkowitz, 285 U.S. 452, 52 S.Ct. 420, 76 L.Ed. 877 (1932), which preceded Harris; Trupiano v. United States, 334 U.S. 699, 68 S.Ct. 1229, 92 L.Ed. 1663 (1948), which intervened between Harris and Rabinowitz; and Preston v. United States, 376 U.S. 364, 84 S.Ct. 881, 11 L.Ed.2d 777 (1964), which followed Rabinowitz; might create some doubt as to what exactly is the controlling pre-Chimel law. Go-Bart, Lefkowitz, Trupiano and Preston, for one reason or another, were more restrictive in their interpretation of what is a "reasonable" search and seizure. Harris and Rabinowitz, on the other hand, permitted more extensive and intensive searches and seizures than did the other cases. See also, Chimel, supra, 395 U.S. at 756-64, 760 n. 4, 768 n. 15, 89 S.Ct. 2034.
From a close reading of both the facts and the holdings of Chimel, Williams and Hill, this Court concludes that these cases implicitly apply the less restrictive standards of Harris and Rabinowitz to pre-Chimel searches and seizures. Many other courts agree with this analysis. For example, the Fourth Circuit expressed its view of pre-Chimel law in Porter v. Ashmore, 421 F.2d 1186, 1189, 1190 (4 Cir. 1970), when it held:
The validity of the search in this case must be determined under the rules promulgated in . . . Rabinowitz . . . and Harris . . . both of which were overruled by Chimel.
* * * * * *
Rabinowitz, however, specifically overruled Trupiano . . . .
* * * * * *
Under the rule of Harris and Rabinowitz it is clear that a search incident to a lawful arrest may extend beyond the immediate vicinity of the one arrested. [citations omitted].
Similarly, Judge Harvey of this District stated in United States v. Frazier, 304 F. Supp. 467, 470 (D. Md. 1969):
In both cases [Von Cleef v. New Jersey, 395 U.S. 814, 89 S.Ct. 2051, 23 L. Ed.2d 728 (1969), and Shipley v. California, 395 U.S. 818, 89 S.Ct. 2053, 23 L.Ed.2d 732 (1969), wherein the Court refused to determine the retroactivity of Chimel,] the Supreme Court in finding the search and seizures to be improper applied the constitutional standards prevailing before Chimel, as set forth in Harris . . . and . . . Rabinowitz . . . . [citations omitted].
See also, United States v. Walden, 464 F.2d 1015, 1020 (4 Cir. 1972); United States v. Kind, 433 F.2d 339, 341 (4 Cir. 1970); Hayden v. Warden, 363 F.2d 647, 651 (4 Cir. 1966); United States v. Lee, 308 F.2d 715, 718 (4 Cir. 1962); United States v. Boyette, 299 F.2d 92, 94 (4 Cir. 1962). See, e. g., United States v. Bankston, 424 F.2d 714, 717 (5 Cir. 1970); United States v. Valdes, 417 F. 2d 335, 340 (2 Cir. 1969), aff'g, 280 F. Supp. 172, 175 (S.D.N.Y. 1968).
Since Harris and Rabinowitz accurately set forth the pre-Chimel law, their facts and holdings are critical to the instant case. In Harris, five FBI agents arrested the defendant in his apartment pursuant to two valid arrest warrants. Following the arrest, the agents searched the entire apartment, expecting to find two stolen checks and perhaps instrumentalities of the crime. "[A] careful and thorough search proceeded for approximately five hours," before the agents discovered various Selective Service cards which were unlawfully altered and concealed. In judging the "reasonableness" of the search and seizure, the Court stated:
This Court has also pointed out that it is only unreasonable searches and seizures which come within the constitutional interdict. The test of reasonableness cannot be stated in rigid and absolute terms. "Each case is to be *441 decided on its own facts and circumstances." Go-Bart Importing Company v. United States, 1931, 282 U.S. 344, 357 [51 S.Ct. 153, 158, 75 L.Ed. 374]. (1931).
* * * * * *
. . . in Agnello v. United States, supra [269 U.S.] at page 30, [46 S.Ct. 4 at page 5, 70 L.Ed. 145], it was said: "The right without a search warrant contemporaneously to search persons lawfully arrested while committing crime and to search the place where the arrest is made in order to find and seize things connected with the crime as its fruits or as the means by which it was committed, as well as weapons and other things to effect an escape from custody is not to be doubted." It is equally clear that a search incident to arrest, which is otherwise reasonable, is not automatically rendered invalid by the fact that a dwelling place, as contrasted to a business premises, is subjected to search.
Nor can support be found for the suggestion that the search could not validly extend beyond the room in which petitioner was arrested. Petitioner was in exclusive possession of a four room apartment. His control extended quite as much to the bedroom in which the draft cards were found as to the living room in which he was arrested.
* * * * * *
. . . the area which reasonably may be subjected to search is not to be determined by the fortuitous circumstances that the arrest took place in the living room as contrasted to some other room of the apartment.
* * * * * *
The same meticulous investigation which would be appropriate in a search for two small canceled checks could not be considered reasonable where agents are seeking a stolen automobile or an illegal still.
* * * * * *
The search was not a general exploration but was specifically directed to the means and instrumentalities by which the crimes charged had been committed, particularly the two canceled checks . . . .
* * * * * *
There was evidence connecting petitioner with that theft [of the two checks]. The search which followed the arrest was appropriate for the discovery of such objects. Nothing in the agents' conduct was inconsistent with their declared purpose.
Harris, supra, 331 U.S. at 150-53, 67 S.Ct. at 1101, 91 L.Ed. at 1406-1407.
The fact pattern and legal analysis of Rabinowitz are very similar to Harris. In the Rabinowitz case a printer was arrested by federal officers for possessing plates which were used to forge "overprints" on canceled stamps. The printer informed authorities that the defendant, a stamp dealer, had purchased a large number of forged overprints from him. Thereafter, a postal employee bought four overprints from the defendant, and it was determined from analysis that these stamps were forgeries. Upon obtaining additional incriminating information and a valid arrest warrant, government agents and two stamp experts went to defendant's place of business and made the arrest. After searching the desk, safe and the file cabinets in the office for about an hour and a half, the agents seized 573 stamps, all of which proved to be forged.
According to the Court, the issue before it was: "Could the officers search his desk, safe and file cabinets . . . all located under respondent's immediate control in his one-room office open to the public?" Rabinowitz, supra, 339 U.S. at 60-61, 70 S.Ct. at 433, 94 L.Ed. at 657. In addition to enumerating many *442 of the principles set forth in Harris, the Rabinowitz Court held:
In the instant case the search was not general or exploratory for whatever might be turned up. Specificity was the mark of the search and seizure here.
* * * * * *
We think the District Court's conclusion that here the search and seizure were reasonable should be sustained because: (1) the search and seizure were incident to a valid arrest; (2) the place of the search was a business room to which the public, including the officers, was invited; (3) the room was small and under the immediate and complete control of respondent; (4) the search did not extend beyond the room used for unlawful purposes; (5) the possession of the forged and altered stamps was a crime, just as it is a crime to possess burglars' tools, lottery tickets or counterfeit money. [footnotes omitted].
Assuming that the officers had time to procure a search warrant, were they bound to do so? We think not, because the search was otherwise reasonable . . ..
Rabinowitz, supra at 62, 63-64, 70 S.Ct. at 434, 94 L.Ed. at 658, 659. See also, Chambers v. Maroney, 399 U.S. 42, 90 S.Ct. 1975, 26 L.Ed.2d 419 (1970); James v. Louisiana, 382 U.S. 36, 86 S. Ct. 151, 15 L.Ed.2d 30 (1965); Stoner v. California, 376 U.S. 483, 84 S.Ct. 889, 11 L.Ed.2d 856 (1964); Preston v. United States, 376 U.S. 364, 84 S.Ct. 881, 11 L.Ed.2d 777 (1964).
In Harris and Rabinowitz, the Supreme Court did not fashion an infallible litmus paper test for what is a "reasonable" search, but certain principles can be gleaned. First, the search must be for specific items, and not a general exploration. See also, Rees v. Peyton, 341 F.2d 859, 863 (4 Cir. 1965). Second, the scope of the search is limited by the size of the item for which the search is being conducted. In other words, one would not expect to find a car in the desk drawer. Third, the extent of the search is limited to those places within the arrestee's control and possession. The police could not, for example, search another building which was removed from the scene of the arrest.
Comparing Harris and Rabinowitz with the facts of the instant case, this Court finds that the search and seizure of Petitioner and the apartment in question were "reasonable" because: (1) the search and seizure were incident to a lawful arrest; (2) the police certainly had probable cause to believe that the stolen alcohol was in the apartment since it had been observed in plain view at an earlier point in time; (3) the search was specific in nature and not a general exploration; and (4) the search, even if conducted throughout every room of the apartment, would not have extended beyond that area over which Petitioner had control.
In regard to the specificity and scope of the search, several other legal principles are relevant. First, an illegal arrest and detention in and of themselves are insufficient grounds for habeas corpus relief, absent a showing that the arrest resulted in an unfair trial. See, e. g., Frisbie v. Collins, 342 U.S. 519, 72 S.Ct. 509, 96 L.Ed. 541 (1952). Even if the arrest were illegal and thus the subsequent search invalid, the Petitioner at best would be entitled to suppress those "fruits" of the alleged illegal arrest and search. Grundler v. North Carolina, 283 F.2d 798, 802 (4 Cir. 1960). In somewhat the same vein, if some evidence were obtained pursuant to a valid arrest and search, but at the same time other evidence were "tainted" by an unreasonable search and seizure, then only the tainted evidence would be denied admission into evidence. The untainted evidence from the same search would still be admissible, and the defendant would suffer no criminal prejudice *443 due to its admission, or due to the fact that part of the search and seizure were unreasonable. See, e. g., United States v. Blue, 384 U.S. 251, 86 S.Ct. 1416, 16 L.Ed.2d 510 (1966); United States v. Ragsdale, 470 F.2d 24, 31 (5 Cir. 1972).
The Petitioner could argue, and quite properly so, that there is no evidence in this case concerning the specificity or scope of the search, and so its "reasonableness" cannot be determined. It is clear, however, that this defect in the proceedings is irrelevant. In this case the only items introduced into evidence were the four bottles of alcohol. As intimated above, any search and seizure which produced the alcohol was per se "reasonable" because the police had authority to search for the bottles of alcohol in any place in the apartment where the bottles might reasonably be expected to be secreted. If any evidence were obtained through a violation of Harris or Rabinowitz and hence part of the search was unreasonable, such evidence was not introduced at trial and could not have possibly prejudiced the Petitioner.
"Plain View" and "Harmless Error":
It is clear that at least one piece of real evidence introduced at the trial, i. e., the bottle of Pikesville whiskey, was properly admitted regardless of the validity of the arrest and search. The Pikesville was seen in "plain view" by Police Officer Gillespie during his third visit to the apartment. The officer did not infringe upon anyone's right to privacy when he observed the bottle. He was merely standing in a common, public hallway when the Petitioner (or Clark) began to leave the apartment with the incriminating evidence jutting out of his sport coat pocket. The validity of the seizure of this bottle and its introduction into evidence cannot be seriously questioned. See, Coolidge v. New Hampshire, 403 U.S. 443, 465-66, 91 S.Ct. 2022, 29 L.Ed.2d 564 (1971). See also, Go-Bart Importing Co. v. United States, 282 U.S. 344, 51 S.Ct. 153, 75 L.Ed. 374 (1931); United States v. Lefkowitz, 285 U.S. 452, 52 S.Ct. 420, 76 L. Ed. 877 (1932); Steele v. United States, 267 U.S. 498, 45 S.Ct. 414, 69 L.Ed. 757 (1925), and Stanley v. Georgia, 394 U.S. 557, 571, 89 S.Ct. 1243, 22 L.Ed.2d 542 (1969) (Steward, J., concurring in result), where police, who have a search warrant, find in "plain view" during the search other admissible items of an incriminating nature; Warden v. Hayden, 387 U.S. 294, 87 S.Ct. 1642, 18 L.Ed.2d 782 (1967), and Hester v. United States, 265 U.S. 57, 44 S.Ct. 445, 68 L.Ed. 898 (1924), where the police inadvertently see evidence in "plain view" while in "hot pursuit"; Chimel v. California, 395 U.S. 752, 89 S.Ct. 2034, 23 L.Ed.2d 685 (1969), where police, in making a valid search incident to a lawful arrest, also seize incriminating evidence in plain view; and Harris v. United States, 390 U.S. 234, 88 S.Ct. 992, 19 L.Ed.2d 1067 (1968); Frazier v. Cupp, 394 U.S. 731, 89 S.Ct. 1420, 22 L.Ed.2d 684 (1969); Ker v. California, 374 U.S. 23, 83 S.Ct. 1623, 10 L.Ed.2d 726 (1963); and Lewis v. United States, 385 U.S. 206, 87 S.Ct. 424, 17 L.Ed.2d 312 (1966), where police, who are not searching for evidence against the accused, seize evidence inadvertently coming into "plain view."
Since the Pikesville was properly admissible, this Court finds that the introduction into evidence of the other three bottles, if error at all, was harmless beyond a reasonable doubt. Schneble v. Florida, 405 U.S. 427, 92 S.Ct. 1056, 31 L.Ed.2d 340 (1972); Harrington v. California, 395 U.S. 250, 89 S.Ct. 1726, 23 L.Ed.2d 284 (1969); United States v. Welch, 496 F.2d 861 (4 Cir. 1974); Miller v. Cox, 457 F.2d 700, 703 (4 Cir. 1972); Close v. United States, 450 F.2d 152, 154 (4 Cir. 1971); United States v. Simuel, 439 F.2d 687, 689 (4 Cir. 1971); Leake v. Cox, 432 F.2d 982, 984 (4 Cir. 1970); Creasy v. Leake, 422 *444 F.2d 69, 71 (4 Cir. 1970).[13] Furthermore, this Court finds that the "minds of the average jury" would not have found the State's case significantly less persuasive had the three bottles been excluded. Indeed, it would be an assumption of irrational jury behavior to think that the verdict would have been different if, instead of all four bottles, only the bottle of Pikesville were introduced into evidence.
ORDER
It is, this 7th day of March, 1975, by the United States District Court for the District of Maryland, ordered:
1. That, for the reasons set forth in the written Memorandum Opinion in the above entitled case, which was filed March 7, 1975, the Petitioner's application for a writ of habeas corpus be and the same is hereby denied;
2. That leave to file in forma pauperis is hereby granted; and
3. That the Clerk of the Court is directed to mail copies of the Memorandum Opinion and this Order to the Petitioner and to the Attorney General of the State of Maryland.
NOTES
[1] Petitioner also alleged that he was not allowed counsel during interrogation or the preliminary hearing.
[2] This time Petitioner also claimed that:
(b) The Trial Court erred in refusing to issue a summons and/or a bench warrant for an important defense witness.
(c) The evidence was insufficient to sustain the conviction.
[3] Technically, Petitioner merely asserted that his arrest was illegal. He also claimed that he was denied the effective assistance of counsel and that he was denied counsel at the preliminary hearing.
[4] In Maryland, the jury in a criminal case is the judge of both the facts and the law. Consequently, hearsay was admitted into evidence during Petitioner's trial for the sole purpose of the jury determining whether or not the police had acted upon probable cause when they arrested Petitioner. (Tr. 39-40). Throughout the rest of this Memorandum Opinion and Order, any hearsay is considered by this Court only insofar as it relates to "probable cause" for the arrest and the "reasonableness" of the search and seizure. Of course, hearsay is admissible for these limited purposes. See, e. g., Scott v. State, 2 Md. App. 705, 237 A.2d 79 (1968).
[5] There can not be an unlawful "search" unless one's Fourth Amendment right to privacy is invaded, and there can be no invasion or violation of one's rights if a police officer is at a place where he lawfully has a right to be. During all three visits to the apartment, Officer Gillespie was lawfully there, and anything which he observed in "plain view" was not "search." See infra, in the text, the discussion of "plain view."
[6] Information provided to the police by a witness has generally been deemed more reliable than that of a paid informant. See, e. g., Brown v. United States, 125 U.S. App. D. C. 43, 365 F.2d 976, 979 (1969).
There is some confusion as to whether or not Officer Gillespie was informed of the surreptitious dealings of the three white males by one (Tr. 41) or two (Tr. 16) citizens. The Court, however, does not consider this inconsistency of any great importance.
[7] At times, reference will be made to comments or statements which were made outside of the jury's hearing at the bench, or while the jury was not even in the courtroom. Such reference will be made, however, only in connection with this Court's determination as to whether the officer had probable cause to effect the arrest, and acted reasonably during the search and seizure.
[8] In reiterating the facts, this Court states that Petitioner was "probably" the one in possession of the half-pint of Pikesville. The trial transcript reads, at page 52:
Q. You don't know which one had the half pint [of Pikesville]?
A. Believe it was Richardson.
Q. But not sure?
A. Not exactly positive at this time. I was at the time . . . .
Q. Can't tell the Jury for sure who had this half pint of whiskey in his pocket, can you?
A. No.
[9] From a reading of the record, this Court concludes that the Petitioner had not left the apartment at the time the police officer arrested the Petitioner. Assuming, arguendo, that the Petitioner had left the apartment, this Court further concludes that the officer's order for Petitioner and Clark to return to the apartment was reasonable under the circumstances. If Officer Gillespie had attempted to arrest all eight of the occupants of the apartment, or even to arrest solely the Petitioner and Clark, his safety might have been in danger. Additionally, there would have been a greater opportunity for any of the eight either to escape or to destroy evidence if the officer had tried to effect the arrest without any assistance. Consequently, this Court concludes that the search was sufficiently "incident" to the arrest, and that it did not exceed the permissible scope or area prescribed by pre-Chimel law.
[10] Although Officer Gillespie detained Petitioner for purposes of "investigation," this does not invalidate his arrest. Ralph v. Pepersack, 335 F.2d 128, 133-35 (4 Cir. 1964).
[11] Hereafter, the testimony concerning the cigars and sausages will not be discussed. Assuming, arguendo, it was improper for the police officer to mention these items, such error, if error at all, was harmless beyond a reasonable doubt.
[12] See also, Henry v. United States, 361 U.S. 98, 103, 80 S.Ct. 168, 4 L.Ed.2d 134 (1959); Shorey v. Warden, Maryland State Penitentiary, 401 F.2d 474, 477 (4 Cir. 1968); United States v. Gearhart, 326 F.2d 412, 414 (4 Cir. 1964).
[13] For the history of the harmless error rule prior to Chapman, see, e. g., Motes v. United States, 178 U.S. 458, 20 S.Ct. 993, 44 L. Ed. 1150 (1900) (constitutional error held to be harmless); Kotteakos v. United States, 328 U.S. 750, 66 S.Ct. 1239, 90 L.Ed. 1557 (1946) (where judge charged jury that there was only one conspiracy and there were in reality at least eight the improper instructions were prejudicial error); Lutwak v. United States, 344 U.S. 604, 73 S.Ct. 481, 97 L.Ed. 593 (1953) (post-conspiracy statement of co-conspirator, which was admitted against all defendants, was harmless error); Fahy v. Connecticut, 375 U.S. 85, 84 S.Ct. 229, 11 L.Ed.2d 171 (1963), rev'g 149 Conn. 577, 183 A.2d 256, (1962) (admission into evidence of "tainted" items was prejudicial error). See also, Long v. United States, 137 U.S. App. D.C. 311, 424 F.2d 799, 804-05 (1969); Coleman v. United States, 137 U.S. App. D.C. 48, 420 F.2d 616, 625 (1969); Otey v. United States, 135 U.S. App. D.C. 142, 417 F.2d 559, 562 (1969); United States ex rel Satz v. Mancusi, 414 F.2d 90 (2 Cir. 1969); United States v. Vallejo, 482 F.2d 616, 618 (3 Cir. 1973); United States ex rel Laws v. Yeager, 448 F.2d 74 (3 Cir. 1971); United States v. Mitchell, 427 F.2d 644 (3 Cir. 1970); United States v. Steinkoenig, 487 F.2d 225, 230 (5 Cir. 1973); Loftis v. Beto, 450 F.2d 599, 600 (5 Cir. 1971); United States v. Manning, 440 F.2d 1105, 1111-12 (5 Cir. 1971); United States v. Bankston, 424 F.2d 714, 717 (5 Cir. 1970). But see, Vaccaro v. United States, 461 F.2d 626, 634-39 (5 Cir. 1972); United States v. Laker, 427 F.2d 189, 190 (6 Cir. 1970); Turner v. United States, 426 F.2d 480, 483 (6 Cir. 1970); United States v. Cale, 418 F.2d 897, 899 (6 Cir. 1969); United States ex rel. Doss v. Bensinger, 463 F.2d 576, 579 (7 Cir. 1972); United States v. Nasse, 432 F.2d 1293, 1303 (7 Cir. 1970); United States v. Wick, 416 F.2d 61, 62 (7 Cir. 1969); Kaufman v. United States, 453 F.2d 798 (8 Cir. 1971); United States v. Warner, 428 F.2d 730 (8 Cir. 1970); Kaneshiro v. United States, 445 F.2d 1266 (9 Cir. 1971); Ignacio v. Territory of Guam, 413 F.2d 513 (9 Cir. 1969).
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IN THE MATTER OF THE PROTECTION OF THE PROPERTY OF MICHELE ADAM, the Protected Person.
No. 28158
Intermediate Court of Appeals of Hawaii.
February 26, 2008.
On the briefs:
Richard Adam, Respondent-Appellant.
Mark Van Pernis and Gary W. Vancil, (Van Pernis Vancil), for Petitioner-Appellee.
Jerel I. Yamamoto, (Nakamoto, Okamoto & Yamamoto), Successor Guardian of the Property-Appellee.
SUMMARY DISPOSITION ORDER
RECKTENWALD, C.J., NAKAMURA and FUJISE, JJ.
Respondent-Appellant Richard Louis Adam (Adam), appearing pro se, appeals from he Judgment of the Circuit Court of the Third Circuit (probate court), which entered judgment in favor of Successor Guardian Jerel I. Yamamoto (Yamamoto), and against Adam and Petitioner-Appellee Gloria Poorman (Poorman).[1]
Adam's opening brief does not comply with Hawai`i Rules of Appellate Procedure (HRAP) Rule 28(b)(4). For example, although Adam's brief identifies 38 alleged errors, these points of error fail to properly state where in the record the alleged errors were objected to or the manner in which the alleged errors were brought to the attention of the probate court.
Additionally, most of Adam's points of error fail to state where in the record the alleged error occurred. See HRAP Rule 28(b)(4).
"Commensurate with the duty to object is the duty to identify where in the record that objection occurred." Onaka v. Onaka, 112 Hawai`i 374, 387, 146 P.3d 89, 102 (2006). In Onaka, the Supreme Court of Hawai`i declined to "canvas the record" to verify whether the appellant "appropriately preserved her points of error on appeal by making a timely objection to the challenged actions," and considered her appellate arguments waived. Id. Points of error not properly presented will be disregarded, but "the appellate court, at its option, may notice a plain error not presented. HRAP Rule 28(b)(4).
Additionally, Adam fails to argue most of the 38 points he presents as error. See HRAP Rule 28(b)(7) (providing that "[p]oints not argued may be deemed waived"). Adam only addresses one of those points in the section entitled "Case Law and Legal Argument." That point is: "I should have been appointed the Guardian under the laws of the State of Hawaii and Uniform [P]robate [C]odes[.]"
Also, Adam has failed to provide the court with transcripts filed in accordance with HRAP Rule 10 with regard to most of the issues that he seeks to raise on appeal. The record on appeal contains transcripts from only five proceedings: (1) an April 5, 2001 hearing on a March 21, 2001 Motion for Approval of Sale of Real Property ("Approval of Sale Motion"), (2) a March 21, 2002 hearing on Adam's January 2, 2002 motion for a new trial ("New Trial Motion"), (3) April 10, 2002 and April 15, 2002 hearings on Adam's motion seeking the recusal of Judge Nakamura ("Recusal Motion"), and (4) a June 6, 2002 hearing on Adam's April 23, 2002 motion for a change of venue and the recusal of Judge Nakamura for embezzlement (Venue/Recusal Motion).[2]
Adam's opening brief also cites to transcripts which are not part of the record on appeal, in violation of HRAP Rule 10 (a) and (b), and Rule 28(b)(10). For example, Adam cites to a transcript that was part of the record of another appeal, and to a photocopy of a transcript for an evidentiary hearing, which was attached to his opening brief as "Appendix C." See HRAP Rule 28(b)(10), and 10(b)(3).
The Supreme Court of Hawai`i "has consistently adhered to the policy of affording litigants the opportunity to `have their cases heard on the merits, where possible.'" Bettencourt v. Bettencourt, 80 Hawai`i 225, 230, 909 P.2d 553, 558 (1995) (quoting O'Connor v. Diocese of Honolulu, 77 Hawai`i 383, 386, 885 P.2d 361, 364 (1994) (citations omitted)) (emphasis added). However, the Supreme Court has declined to review issues on appeal when the appellant has failed to provide transcripts of the relevant proceedings. Id. at 230-31, 909 P.2d at 558-59; see also Marn v. Reynolds, 44 Haw. 655, 663, 361 P.2d 383, 388 (1961).
Applying these principles here, we will not address those issues for which relevant transcripts have not been provided, for which no discernable argument has been given, or which do not identify where in the record the alleged error occurred and where it was objected to or otherwise brought to the attention of the probate court. We will address the following points of error:
(1) Did the probate court err in approving the sale of the Hawaiian Ocean View Estates (HOVE) property?
(2) Did the probate court err in denying Adam's New Trial Motion?
(3) Did the probate court err in denying the Recusal Motion and the Venue/Recusal Motion?
(4) Should [Adam] have been appointed the Guardian under the laws of the State of Hawai`i and Uniform Probate Codes?
After a careful review of the record and the briefs submitted by the parties, and having given due consideration to the arguments advanced and the issues raised, we resolve Adam's points of error as follows:
(1) The probate court did not abuse its discretion in approving the sale of the HOVE property, Hawaii Revised Statutes (HRS) §§ 560:5-403(4) & 408 (1993), given the condition and history of the property, and the prior efforts made to sell the property.
(2) The probate court did not abuse its discretion in denying Adam's New Trial Motion, since the motion was untimely. See Hawai`i Rules of Civil Procedure (HRCP) Rule 59(b).
(3) The probate court did not abuse its discretion in denying the Recusal Motion and the Venue/Recusal. Motion, since Adam failed to demonstrate that Judge Nakamura was biased against him. The fact that Judge Nakamura had issued rulings adverse to Adam did not establish bias. Aga v. Hundahl 78 Hawai`i 230, 242, 891 P.2d 1022, 1034 (1995).
(4) The probate court did not err when it appointed Stephen J. Arnett (Arnett) rather than Adam as guardian. The court's order appointing Arnett as guardian indicates that the appointment was made pursuant to a stipulation entered into by Adam and Poorman, through their attorneys. The Order Appointing Independent Third Party As Guardian states in relevant part:
The Court having carefully considered the Petitions, the record herein and the stipulation placed on record by the parties [sic] attorneys by telephone on June 24, 1999 wherein the parties agreed through their respective attorneys to the court's appointment of an independent third party Guardian of the Property the court HEREBY ORDERS, ADJUDGES AND DECREES:
1. A basis exists for the appointment of a Guardian of the property of [Michele] Adam and it is in the best interests of [Michele] Adam that a Guardian of the property be appointed.
2. Therefore and pursuant to the parties stipulation Steven Arnett is hereby appointed as independent third party Guardian of the Property of [Michele] Adam.
(Emphasis added.)
Since the record indicates that Adam stipulated to the appointment of Arnett, he cannot challenge the appointment on appeal. Hana Ranch, Inc. v. Kumakahi, 6 Haw. App. 341, 353, 720 P.2d 1023, 1032 (1986). Although Adam suggests that he was pressured by the probate court into agreeing to that stipulation, the record on appeal does not support that assertion.[3] Given the stipulation, and given the absence of evidence in the record establishing that Adam did not in fact consent to the stipulation, the probate court did not err in appointing Arnett as Guardian of Michele's property. See HRS § 560:5-410(b)(1993).
Therefore,
IT IS HEREBY ORDERED that the Final Judgment of the Circuit Court of the Third Circuit entered on September 22, 2006 is affirmed.
NOTES
[1] The Hon. Greg K. Nakamura presided.
[2] The Honorable Riki May Amano presided over the April 10, April 15, and June 6, 2002 hearings.
[3] Adam did not include in the record on appeal a transcript of the June 24, 1999 hearing on Poorman's and Adam's petitions for appointment of guardian of property.
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IN THE DISTRICT COURT OF APPEAL
FIRST DISTRICT, STATE OF FLORIDA
EUGENE LUCAS, NOT FINAL UNTIL TIME EXPIRES TO
FILE MOTION FOR REHEARING AND
Appellant, DISPOSITION THEREOF IF FILED
v. CASE NO. 1D16-2119
STATE OF FLORIDA,
Appellee.
_____________________________/
Opinion filed November 7, 2016.
An appeal from an order of the Circuit Court for Duval County.
Angela Cox, Judge.
Eugene Lucas, pro se, Appellant.
Pamela Jo Bondi, Attorney General, Tallahassee, for Appellee.
PER CURIAM.
AFFIRMED.
WOLF, RAY, and MAKAR, JJ., CONCUR.
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289 P.2d 135 (1955)
William Arthur RIDENOUR, Petitioner,
v.
VAN PICK OIL COMPANY, Tri-State Insurance Company and the State Industrial Commission, Respondents.
No. 36848.
Supreme Court of Oklahoma.
October 18, 1955.
*136 A.H. Huggins, Norman, for petitioner.
Looney, Watts, Ross, Looney & Nichols, Oklahoma City, and Mac Q. Williamson, Atty. Gen., for respondents.
BLACKBIRD, Justice.
Claimant sustained an accidental injury May 6, 1953, when he strained his back while lifting a 600 pound tractor tire. He was paid temporary disability until December 7, 1954, when he was notified by the employer that payments had ceased. In a proceeding to determine the extent of disability commenced thereafter an award was made under the date of February 8, 1955, finding that claimant had sustained 30 per cent permanent disability. On appeal to the Commission en banc this was reduced to 15 per cent. This proceeding is brought by claimant against Van Pick Oil Company, employer, and Tri-State Insurance Company, its insurance carrier, to review said award on the ground that there is no competent evidence to support the reduction to 15 per cent.
In the proceeding to determine the extent of disability claimant filed the report of Dr. M, dated January 10, 1955. This physician stated, in effect, that claimant was still temporarily totally disabled. The employer filed the report of Dr. F who stated that the healing period had ceased and claimant had no disability. The trial commissioner ordered claimant to report to Dr. O and following an examination at the direction of the trial commissioner, Dr. O stated:
"* * * His symptoms are relatively quiescent at this time and on the basis of examination now, one would say his disability is probably not more than 25%. However, it may well be that after trying to work, his condition would become considerably aggravated and if this is the case, he should by all means proceed to have his back operated on; although his symptoms today do not seem to be enough to justify this. It is difficult to see why his permanent disability could be more than 30-40% in any event. He, himself, feels he could probably do some light work."
It was following this report that the trial commissioner fixed the disability at 30 per cent and thereafter it was reduced to 15 per cent.
Claimant argues that there is no competent evidence to support the finding that he has a 15 per cent permanent partial disability and points to the testimony of Dr. F, in which the doctor states:
"I feel that this patient has no need of medical treatment. His condition has not changed since the previous examination. He has no evidence of any partial permanent disability at this time."
This statement follows the word "discussion" and concludes the report of Dr. F. Claimant states that it is indefinite and uncertain and within the rule announced in Sparks v. General Mills, Inc., Okl., 262 P.2d 155. We do not agree. In Sparks v. General Mills, Inc., supra, there was a conjecture by the physician who filed the report as to the probability of future disability. In the case under consideration the statement is definite and makes no prediction as to future disability.
We have held that the State Industrial Commission has the right to fix the degree of disability anywhere within the range of medical evidence. Producers Drilling Co. v. Percival, 207 Okl. 17, 246 P.2d 374; Groninger v. Christley, 204 Okl. 310, 229 P.2d 582; Special Indemnity Fund v. Arnold, 201 Okl. 51, 200 P.2d 907.
There is competent evidence reasonably tending to support the finding of the State Industrial Commission.
Award sustained.
JOHNSON, C.J., WILLIAMS, V.C.J., and CORN, HALLEY and JACKSON, JJ., concur.
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537 U.S. 935
SINGLETONv.UNITED STATES.
No. 02-5916.
Supreme Court of United States.
October 7, 2002.
1
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT.
2
C. A. 11th Cir. Certiorari denied. Reported below: 34 Fed. Appx. 968.
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Ghaffar v Foster (2019 NY Slip Op 01569)
Ghaffar v Foster
2019 NY Slip Op 01569
Decided on March 6, 2019
Appellate Division, Second Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and subject to revision before publication in the Official Reports.
Decided on March 6, 2019
SUPREME COURT OF THE STATE OF NEW YORK
Appellate Division, Second Judicial Department
REINALDO E. RIVERA, J.P.
CHERYL E. CHAMBERS
SYLVIA O. HINDS-RADIX
JOSEPH J. MALTESE, JJ.
2018-04162
(Index No. 705108/16)
[*1]Gabriella Ghaffar, respondent,
vScott R. Foster, appellant, et al., defendant.
Kelly, Rode & Kelly, LLP, Mineola, NY (Eric P. Tosca of counsel), for appellant.
Paul Ajlouny & Associates, P.C., Garden City, NY (Edward J. Nitkewicz and Justin S. Curtis of counsel), for respondent.
DECISION & ORDER
In an action to recover damages for personal injuries, the defendant Scott R. Foster appeals from an order of the Supreme Court, Queens County (Allan B. Weiss, J.), entered February 6, 2018. The order denied that defendant's motion for summary judgment dismissing the complaint insofar as asserted against him.
ORDERED that the order is affirmed, with costs.
The defendant Scott R. Foster was operating his vehicle in the left westbound lane of Merrick Road when he crossed over the double yellow line and struck the defendant Kevin A. Knight's vehicle, which was traveling in the left eastbound lane of Merrick Road. The defendant Foster's vehicle then spun toward and made contact with the plaintiff's vehicle, which was traveling in the right eastbound lane of Merrick Road. The plaintiff subsequently commenced this action against the defendants to recover damages for personal injuries. Foster moved for summary judgment dismissing the complaint insofar as asserted against him, contending that he lost control of his vehicle because he suffered an unforeseen hypoglycemia-induced seizure. The Supreme Court denied the motion, and Foster appeals.
"The operator of a vehicle who becomes involved in an accident as the result of suffering a sudden medical emergency will not be chargeable with negligence as long as the emergency was unforeseen" (Serpas v Bell, 117 AD3d 712, 713; see Van De Merlen v Karpf, 147 AD3d 1008; Pitt v Mroz, 146 AD3d 913, 914). Here, Foster, who suffered from diabetes, failed to establish, prima facie, that he experienced an unforeseen medical emergency (see generally McGinn v New York City Tr. Auth., 240 AD2d 378, 379; Thomas v Hulslander, 233 AD2d 567, 568). Since Foster failed to meet his initial burden as the movant, the burden never shifted to the plaintiff to raise triable issues of fact.
Accordingly, we agree with the Supreme Court's denial of Foster's motion for summary judgment dismissing the complaint insofar as asserted against him.
RIVERA, J.P., CHAMBERS, HINDS-RADIX and MALTESE, JJ., concur.
ENTER:
Aprilanne Agostino
Clerk of the Court
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SUPREME COURT OF THE STATE OF NEW YORK
Appellate Division, Fourth Judicial Department
1118
KA 14-00225
PRESENT: SMITH, J.P., DEJOSEPH, CURRAN, AND SCUDDER, JJ.
THE PEOPLE OF THE STATE OF NEW YORK, RESPONDENT,
V MEMORANDUM AND ORDER
DAVID A. HENNIGAN, DEFENDANT-APPELLANT.
(APPEAL NO. 2.)
LEANNE LAPP, PUBLIC DEFENDER, CANANDAIGUA (CARA A. WALDMAN OF
COUNSEL), FOR DEFENDANT-APPELLANT.
R. MICHAEL TANTILLO, DISTRICT ATTORNEY, CANANDAIGUA (MELANIE J. BAILEY
OF COUNSEL), FOR RESPONDENT.
Appeal from a judgment of the Ontario County Court (Craig J.
Doran, J.), rendered July 2, 2012. The judgment convicted defendant,
upon his plea of guilty, of burglary in the second degree and petit
larceny (two counts).
It is hereby ORDERED that the judgment so appealed from is
unanimously affirmed.
Same memorandum as in People v Hennigan ([appeal No. 1] ___ AD3d
___ [Dec. 23, 2016]).
Entered: December 23, 2016 Frances E. Cafarell
Clerk of the Court
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USCA1 Opinion
June 16, 1993 [NOT FOR PUBLICATION] UNITED STATES COURT OF APPEALS FOR THE FIRST CIRCUIT ___________________ No. 93-1223 ELIESABETH AMELUNG, Plaintiff, Appellant, v. MILTON SAVINGS BANK, ET AL, Defendants, Appellees. __________________ APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MASSACHUSETTS [Hon. Joseph L. Tauro, U.S. District Judge] ___________________ ___________________ Before Selya, Boudin and Stahl, Circuit Judges. ______________ ___________________ Eliesabeth Amelung on brief pro se. __________________ Thomas A. Schulz, Assistant General Counsel, Ann S. DuRoss, ________________ _____________ Assistant General Counsel, Richard J. Osterman, Senior Counsel, ____________________ and Florian Frederick Chess, Senior Attorney, Federal Deposit ________________________ Insurance Corporation, on brief for appellee, Federal Deposit Insurance Corporation. Carolyn B. Lieberman, Acting Chief Counsel, Thomas J. Segal, ____________________ _______________ Deputy Chief Counsel, Elizabeth R. Moore, Assistant Chief _____________________ Counsel, and Frances C. Augello, Senior Trial Attorney, Office of __________________ the Chief Counsel, Office of Thrift Supervision, on brief for appellee, Office of Thrift Supervision. __________________ __________________ Per Curiam. We have carefully reviewed plaintiff's ___________ filings and conclude plaintiff failed to state any cause of action over which a federal court has jurisdiction. Consequently, we affirm the judgment dismissing plaintiff's action. Affirmed. ________ -2-
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COURT OF APPEALS
SECOND DISTRICT OF TEXAS
FORT WORTH
NO. 02-16-00327-CV
IN THE INTEREST OF P.S. AND
C.S., CHILDREN
----------
FROM THE 323RD DISTRICT COURT OF TARRANT COUNTY
TRIAL COURT NO. 323-100795-14
----------
MEMORANDUM OPINION1
----------
Appellant N.P. (Mother) filed a timely notice of appeal from the August 22,
2016 judgment terminating her parental rights to P.S. and C.S. Mother timely
filed a motion for new trial on September 8, 2016. Thereafter, we learned that
the trial court had granted Mother’s motion for new trial but had not signed an
1
See Tex. R. App. P. 47.4.
order. See Smith v. McCorkle, 895 S.W.2d 692, 692 (Tex. 1995) (“A docket
entry does not constitute a written order.”).
On October 11, 2016, we sent a letter to the parties stating that it had
come to the court’s attention that the trial court had granted Mother’s motion for
new trial. We requested that the parties supply us with a signed copy of the
order granting Mother’s motion for new trial on or before Friday, October 21,
2016. The letter also stated that upon receipt of a signed copy of the order
granting Mother’s motion for new trial, the appeal could be dismissed as moot
unless any party desiring to continue the appeal filed a response on or before
Friday, October 21, 2016, stating grounds for continuing this appeal.
On October 17, 2016, we received a signed copy of the agreed order
granting Mother’s motion for new trial, granting the Department’s motion for new
trial, and finding “that all parties are agreed to the new trial.” No response was
received from either party showing grounds for continuing the appeal.
Therefore, on this court’s own motion, we dismiss this appeal as moot.
See Tex. R. App. P. 42.3(a), (c), 43.2(f).
PER CURIAM
PANEL: WALKER, GABRIEL, and SUDDERTH, JJ.
DELIVERED: November 3, 2016
2
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TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-13-00020-CV
Agbolade Odutayo, Appellant
v.
Richards Memorial Hospital, et al., Appellees
FROM THE DISTRICT COURT OF MILAM COUNTY, 20TH JUDICIAL DISTRICT
NO. CV32,075, HONORABLE JAN P. PATTERSON, JUDGE PRESIDING
MEMORANDUM OPINION
Appellant’s notice of appeal was filed on January 7, 2013, and the appellate
record was complete on April 1, making appellant’s brief due May 1. Appellant attempted to file
two motions seeking an extension of time, but both were rejected because they did not comply
with the rules of appellate procedure. On August 8, acting on our own motion, we issued an
order requiring appellant to file a brief, along with a proper motion for extension of time, no later
than August 26, cautioning that a failure to file by that date would result in the dismissal of the
appeal. To date, appellant has not filed a brief or motion or otherwise responded to our order.
We therefore dismiss the appeal for want of prosecution. Tex. R. App. P. 42.3(b).
________________________________________
David Puryear, Justice
Before Justices Puryear, Rose and Goodwin
Dismissed for Want of Prosection
Filed: October 16, 2013
2
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5 Mich. App. 717 (1967)
147 N.W.2d 740
PEOPLE
v.
LLOYD.
Docket No. 1,306.
Michigan Court of Appeals.
Decided January 24, 1967.
Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, Samuel H. Olsen, Prosecuting Attorney, Samuel J. Torina, Chief Appellate Lawyer, and Richard J. Padzieski, Assistant Prosecuting Attorney, for the people.
Talbot M. Smith, for defendant.
HOLBROOK, J.
In June 1965, the defendant was tried in the recorder's court for the city of Detroit before a jury and convicted of robbery armed.[1] Asserting 3 errors for review the defendant has appealed to this Court.
The pertinent facts appear to be as follows: The robbery, committed in a grocery store at 7600 Dunedin in the city of Detroit, occurred on November 20, 1964, at approximately 7:45 p.m. Mr. Lloyd McReynolds, the owner of the store, testified that the *720 first time he saw the defendant was on the sidewalk in front of the store, where the defendant had asked McReynolds questions regarding the whereabouts of an unidentified person. Almost immediately thereafter, the defendant entered the store for the alleged purpose of getting warm, but instead pulled a gun and then proceeded to take the contents of the cash register. James Shannon, another witness who testified for the people, stated that he saw the defendant running north on Dunedin street immediately after the robbery. At that time, Shannon did not know that a robbery had been committed, but he recognized the defendant as one of the boys who lived in the neighborhood. Shannon did not give the police a description or the name of the person he saw running on the street. McReynolds described the robber as a colored male, 22 years old, 6'2" to 6'3" in height, 165 lbs., skinny, with a mustache, dark complexion, thick lips, and wearing a dark, three-quarter length trench coat, light pants and a light colored do-rag on his head.
The defendant was arrested on the night of November 20, 1964, at approximately 10 p.m., on an unspecified charge, and was released on November 22, 1964. No money was found on his person. The defendant was arrested again on December 25, 1964, for the armed robbery which is the subject matter of this case.
After this second arrest the defendant was placed in a lineup with four other persons and was identified by Mr. McReynolds as the person who had committed the holdup. The lineup consisted entirely of persons of the Negro race, ranging in height from 5'7" to 6'1". Of those present, the defendant was the youngest, tallest and thinnest. In a second showup, conducted on December 27, 1964, there were five persons of the Negro race present and Mr. Shannon *721 identified the defendant as the person he had seen running on the street the night of the robbery.
The defendant's defense was that he was not present at the scene of the crime when it occurred. Three alibi witnesses, not members of his family, testified that the defendant was with them at the specific time of the crime; however, another alibi witness called by the defendant corroborated the fact that the defendant was with the four of them but not at the time of the offense.
Defendant's first contention is that certain testimony which the trial court refused to exclude constituted an admission or confession elicited by the police while the defendant was under arrest and without warning of his constitutional rights, and that its introduction into evidence was reversible error.
In reviewing the testimony of the defendant on cross-examination, the prosecutor asked the defendant if he ever owned a gun. He indicated by his answers that he did acquire a gun in December after the alleged offense took place. When he was picked up on November 20, 1964, the evening of the offense, a toy gun was found in the automobile in which he was riding. The defendant was asked if the gun that he acquired in December was a toy gun. His reply was in the negative. The prosecutor also questioned the defendant as to whether he had ever given anyone a different answer than that he had acquired a gun in December. To this he replied "no." Then the following questions and answers appear in the record:
"Q. (By Mr. Picone) Now, you remember being questioned by this detective about the gun?
"A. Yes.
"Q. What did you tell him about the gun?
"A. I don't remember what I told him about the gun, been so long ago.
*722 "Q. What?
"A. Been too long, I don't remember what I told him about the gun.
"Q. All right, when he was questioning you, had anybody threatened you in any way?
"The Court. Just a minute, just a minute. The jury is excused."
At this point in the trial, the jury was excused and the court conducted a Walker hearing.[2] The court determined that any admission or confession claimed by the people to be proper was involuntarily given and therefore inadmissible.
There is nothing in the testimony summarized and quoted above, which was admitted prior to the Walker hearing, which could reasonably be said to constitute an admission or confession. Since the court below held an independent hearing outside the jury's presence and ruled the people's proffered evidence of an admission or confession inadmissible, we find no ground for reversal on this issue.
Defendant improperly advances the theory that the matter of an admission or confession also encompassed his cross-examination by the prosecuting attorney. As noted before, no confession or admission was introduced in evidence in the presence of the jury.
The defendant voluntarily took the witness stand on his own behalf and it is well settled that once a defendant takes the stand he then becomes subject to cross-examination as any other witness. People v. McCrea (1942), 303 Mich 213; Raffel v. United States (1926), 271 US 494 (46 S Ct 566, 70 L ed 1054).
Possession of a weapon is a necessary element of the crime of robbery armed and it cannot be said *723 that it was improper for the prosecutor to question the defendant as to his possession of a gun.
Defendant claims that he was denied a fair trial because of the following factors or a combination thereof: (a) the conduct of the trial judge, (b) the composition of the two lineups in which the defendant appeared, (c) the prosecutor's references to the "thick lips" of the defendant.
The defendant claims that his right to a fair trial was prejudiced because of frequent interruptions from the bench during cross-examination of the people's identification witnesses. In support of this claim, the defendant points out 16 different instances where the court interrupted with comments. Seven of these comments related to instances where counsel repeatedly asked questions which the witness had already answered. In this situation, a trial court may go to considerable length to limit repetition of questions, and even order counsel to desist, since the judge has the right to control and maintain the orderly conduct of the business before the court. People v. Whitney (1895), 105 Mich 622. See, also, 2 Gillespie, Michigan Criminal Law and Procedure (2d ed), § 592.
In three instances, the court interrupted counsel because he was becoming argumentative in his cross-examination of the witness. Witnesses in a judicial proceeding are entitled to respectful consideration and it is the duty of the court to enforce this protection. People v. Huff (1913), 173 Mich 620.
On two occasions, the court asked questions of the witness. This procedure is not objectionable, especially since it was done in the interest of justice and since the judge did not interpose his personal views. People v. Fedderson (1950), 327 Mich 213.
Finally, the court asked counsel to rephrase a question, whether he was going to enter the showup *724 line, and refused to let the witness answer a question comparing the defendant's coat to those worn by spies on television. Under CL 1948, § 768.29 (Stat Ann 1954 Rev § 28.1052), the trial court has the duty of controlling the conduct of the trial. In exercising this duty, he exercises a broad discretion where cross-examination of witnesses is concerned. People v. Layman (1941), 299 Mich 141; People v. Fedderson, supra. From an examination of the record, it does not appear that this discretion was abused.
The court also stated in the instructions:
"Now, in that connection, I want to say this. The court is charged with the conduct of the trial. He's had to pass on the objections of counsel, he has spoken to counsel in order to maintain a proper decorum in the conduct of the trial and he has also asked some questions of the witnesses or some of the witnesses for the purpose of clarification. Now, in that connection, I want you to know that this court has no opinion whatsoever of the guilt or innocence of this defendant, which he intends to convey to you, members of the jury. Because as I have said before, that responsibility is strictly yours."
The defendant claims prejudice because he was not placed in a lineup with people of similar physical characteristics. In the two lineups in which he appeared, he was the tallest and the thinnest person present.
Lineups are conducted in police stations, and the persons who participate in the lineup are taken from those who are being held in custody. It would be unusual indeed if the police had five persons with similar physical characteristics locked up in the same jail. Moreover, the purpose of a lineup is identification. If the defendant is the tallest man in the lineup, and if he believes that this impairs the validity of the identification, he should see that the *725 jury is apprised of that fact. This is a question of the weight to be given the lineup identification, not its admissibility. It presents no basis for a new trial.
Such lineups have been approved in the recent case of Wade v. United States (CA 5, 1966), 358 F2d 557 at p 559. For an interpretation of this case see People v. Camak (1967), 5 Mich App 655.
During the course of trial, eight references were made to the defendant's thick lips. Six of those instances were from the prosecutor, and of the six, three were during his summation. Of the remaining two, the defendant's lips were mentioned once by his own counsel and once by a police officer on the stand. At no time during the trial did defense counsel object to mention of this particular identifying feature.
The thick lips of the defendant were one of the features which enabled witnesses to identify him, and it is difficult to see how this could have been prejudicial.
We said in People v. Camak, supra, at p 665 the following:
"It is axiomatic that in the course of a trial, conflict of testimony may very well occur. It is for this reason that the credibility of the witnesses and the weight to be given their testimony is for the determination of the trier of the facts. People v. Szymanski (1948), 321 Mich 248; People v. Clark (1954), 340 Mich 411."
We conclude that there was sufficient testimony presented by the people if believed by the jury to justify a verdict of guilty beyond a reasonable doubt.
Affirmed.
LESINSKI, C.J., and J.H. GILLIS, J., concurred.
NOTES
[1] CLS 1961, § 750.529 (Stat Ann 1965 Cum Supp § 28.797).
[2] See People v. Walker (On Rehearing), 374 Mich 331. REPORTER.
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NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with
Fed. R. App. P. 32.1
United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Argued June 13, 2007
Decided June 26, 2007
Before
Hon. JOHN L. COFFEY, Circuit Judge
Hon. JOEL M. FLAUM, Circuit Judge
Hon. ANN CLAIRE WILLIAMS, Circuit Judge
No. 06-3307
UNITED STATES OF AMERICA, Appeal from the United States
Plaintiff-Appellee, District Court for the Northern
District of Illinois, Eastern Division.
v.
No. 05 CR 375
PATRICK HROBOWSKI,
Defendant-Appellant. Samuel Der-Yeghiayan,
Judge.
ORDER
Patrick Hrobowski was indicted in April 2005 for being a felon in possession
of a handgun, see 18 U.S.C. § 922(g)(1), and knowingly possessing a handgun with
an obliterated serial number, see 18 U.S.C. § 922(k). In March 2006 a jury found
him guilty on both counts. The district court subsequently denied his motions for
acquittal and for a new trial, and sentenced him to 264 months’ imprisonment.
Hrobowski appeals, arguing that the evidence at trial was insufficient to support a
conviction on either count. We affirm.
We review the following evidence admitted at trial, and all reasonable
inferences that may be drawn from it, in the light most favorable to the
government. United States v. Hendrix, 482 F.3d 962, 966 (7th Cir. 2007); United
No. 06-3307 Page 2
States v. Romero, 469 F.3d 1139, 1151 (7th Cir. 2006). According to August Palmer,
a heroin addict and lifelong acquaintance of Hrobowski who became a government
witness, Hrobowski possessed the handgun in question on numerous occasions
while he was living with Palmer in September 2004. Palmer and two of
Hrobowski’s relatives testified that on September 6 they drove to Hrobowski’s
girlfriend’s house to pick him up for a party. Officer Dwayne Wheeler of the
Maywood Police Department testified that he happened to be conducting
undercover surveillance of the same house because it was a suspected site of drug
use and sales. All the eyewitnesses agreed that Palmer went into the house and
returned with Hrobowski. Officer Wheeler recognized Hrobowski and knew he was
a felon; his criminal history was also stipulated to at trial.
When he emerged from the house, Hrobowski did not yet have a gun with
him. But he promptly sent Palmer back inside to retrieve clothes of his that were
sitting on a chair in the bedroom. According to Palmer, the clothes included a pair
of jeans that had a gun sticking out of a pocket, and he immediately recognized the
gun as the one Hrobowski routinely carried with him. Palmer collected the clothes
with the gun and took them outside to Hrobowski. Officer Wheeler saw Palmer
carrying a pair of jeans with a handgun sticking out of the pocket. All eyewitnesses
agreed that Hrobowski took the jeans from Palmer, though his two relatives in the
car denied seeing the gun. Hrobowski and Palmer got into the car with the others
and drove away.
Officer Wheeler pursued Hrobowski. He followed the car and called for
backup on the main dispatch radio channel. He and his two backup officers
testified that they then switched to an alternate radio channel and Officer Wheeler
informed them that they were going to conduct a felony stop involving a handgun.
Palmer testified that when Hrobowski saw the officers flash their emergency lights,
he handed the gun to Palmer and told him to run with it once the car stopped.
Palmer refused. All three officers confirmed that when they stopped the car, they
ordered everyone’s hands in the air, but Hrobowski instead reached down toward
the floor. When the officers removed the passengers from the car, they found the
jeans and the loaded handgun on the floor where Hrobowski had been reaching.
The officers arrested Hrobowski.
A firearms expert determined that all three serial numbers on the handgun
had been intentionally obliterated, but he was able to recover them with the use of
an acid-etching process. A special agent from the Bureau of Alcohol, Tobacco,
Firearms, and Explosives determined that the handgun was manufactured in
Argentina.
Hrobowski argues on appeal that his conviction was not supported by
sufficient evidence. He claims that Palmer is not a credible witness because of his
No. 06-3307 Page 3
continued heroin addiction, his interest in not being prosecuted in exchange for his
testimony, and the inconsistencies between his trial testimony and his grand jury
testimony. He adds that the testimony of the officers was inconsistent, exposed a
botched investigation, and revealed that they never actually saw Hrobowski with a
gun, making their testimony unworthy of admission to a jury.
Hrobowski bears a “heavy burden” to show that no rational trier of fact could
find the essential elements of the crime beyond a reasonable doubt based on the
evidence in the record. Hendrix, 482 F.3d at 966; Romero, 469 F.3d at 1151. When
reviewing the sufficiency of the evidence, we will not second-guess a jury’s credibility
determinations absent exceptional circumstances: when it was physically impossible
for a witness to have observed what he claims occurred or when it is impossible
under the laws of nature for that occurrence to have taken place at all. United
States v. Radziszewski, 474 F.3d 480, 485 (7th Cir. 2007).
None of the factual questions identified by Hrobowski undermine the
sufficiency of the evidence against him. All his arguments are merely attacks upon
the credibility of the witnesses, and none of his attacks approach the demanding
standard required to reconsider their credibility. See Radziszewski, 474 F.3d at 485.
He points out, for instance, that Officer Wheeler misidentified the color of the car
carrying Hrobowski as grey instead of green, and reported a license plate number
that was incorrect by one digit. He calls into question whether the officers ever saw
Hrobowski with a gun, because Officer Wheeler’s initial call for backup on the
recorded dispatch channel did not mention a gun. Officer Wheeler supposedly
informed the other officers of the gun only on an unrecorded radio channel.
Moreover, a member of Hrobowski’s family testified that she saw Officer Wheeler
driving in his vehicle at the time he claimed to be conducting surveillance, and she
disputed his account of how the pursuit began. Also, some testimony suggested that
Palmer handed Hrobowski the jeans inside the car, where Officer Wheeler could not
have seen Hrobowski accept the gun.
While Hrobowski may interpret the evidence to show that the prosecution’s
case is based on untruths, we cannot accept his speculative arguments over the
jury’s own credibility determinations. See United States v. Humphreys, 468 F.3d
1051, 1053 (7th Cir. 2006). Hrobowski had the opportunity at trial to attack the
credibility of the government’s witnesses, and he did so. Those attacks simply did
not persuade the jury.
AFFIRMED.
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Opinions of the United
2005 Decisions States Court of Appeals
for the Third Circuit
11-9-2005
In Re: Tyson Foods
Precedential or Non-Precedential: Non-Precedential
Docket No. 04-3305
Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2005
Recommended Citation
"In Re: Tyson Foods " (2005). 2005 Decisions. Paper 247.
http://digitalcommons.law.villanova.edu/thirdcircuit_2005/247
This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova
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University School of Law Digital Repository. For more information, please contact [email protected].
NOT PRECEDENTIAL
IN THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
Case No: 04-3305
IN RE: TYSON FOODS, INC. SECURITIES LITIGATION;
AETOS CORPORATION;
PELICAN LIMITED PARTNERSHIP;
STARK INVESTMENTS L.P.;
SHEPHERD INVESTMENTS INTERNATIONAL LTD.
v.
TYSON FOODS, INC.; JOHN TYSON;
LES R. BALEDGE; DON TYSON;
MANAGEMENT RISK TRADING LP
Aetos Corporation;
Pelican Limited Partnership;
Stark Investments, L.P.;
Shepherd Investments International, Ltd.,
class representative,
Appellants
On Appeal From the United States District Court
For the District of Delaware
(D.C. Civ. Action No. 01-cv-425)
District Judge: Hon. Sue L. Robinson, Chief Judge
Argued September 13, 2005
BEFORE: SLOVITER, BARRY, and SMITH, Circuit Judges
(Opinion Filed: November 9, 2005)
Counsel: Michael H. Schaalman [Argued]
Quarles & Brady
411 East Wisconsin Avenue
Suite 2040
Milwaukee, WI 53202
Karin E. Fisch
Abbey Gardy
212 East 39th Street
New York, NY 10016
John L. Reed
Edwards & Angell
919 North Market Street
14th Floor
Wilmington, DE 19801
Counsel for Appellants
David F. Graham [Argued]
James W. Ducayet
Anne E. Rea
Melanie E. Walker
Sidley, Austin, Brown & Wood
10 South Dearborn Street
Bank One Plaza
Chicago, IL 60603
Counsel for Appellees
OPINION OF THE COURT
SMITH, Circuit Judge:
On March 29, 2001, Tyson Foods, Inc. (“Tyson Foods”), the nation’s largest
poultry distributor, issued a press release announcing its intention to terminate a $4.7
billion merger agreement with IBP, Inc. (“IBP”), the nation’s largest beef distributor.
The press release included a termination letter addressed to IBP executives, which was
signed by Les Baledge, Tyson Foods’ Executive Vice President and General Counsel.
The letter accused IBP of failing to disclose the gravity of an SEC investigation at the
time of the agreement and neglecting to correct earlier misstatements in its SEC filings.
The letter stated that as a result of its reliance on IBP’s “misleading statements” in the
earlier filings, Tyson Foods “believed” it had been “inappropriately induced to enter into
the Merger Agreement.” That press release and attached termination letter sparked a
series of lawsuits by IBP shareholders who alleged that the documents contained material
misrepresentations and omissions in violation of sections 10(b) and 20(a) of the Securities
Exchange Act of 1934, 15 U.S.C. § 78j and 78t, and Rule 10b-5 promulgated thereunder.
The District Court consolidated the cases and named Aetos Corporation, Pelican Limited
Partnership, Stark Investments, L.P., and Shepherd Investments International, Ltd. as lead
plaintiffs (“Shareholders”). The case was subsequently certified as a class action.
On cross-motions for summary judgment, the District Court concluded that Senior
Chairman Don Tyson and Chief Executive Officer John Tyson did not “make” the alleged
misrepresentations and that Baledge did not act with the requisite scienter in issuing the
press release and termination letter for § 10(b) liability to attach. The Court therefore
granted summary judgment in favor of the Tysons, Baledge, and Tyson Foods. The
Shareholders now appeal that decision.
3
The Shareholders’ argument is three-fold. First, with respect to the Tysons’
liability, they argue that the Tysons participated in “making” the alleged
misrepresentations by instructing Baledge to issue the press release and then failing to
correct the false statements contained therein. Second, the Shareholders contend that
there is at least a genuine issue of material fact as to what Baledge knew and whether he
acted with the requisite scienter. Third, they claim that Tyson Foods is primarily liable
for misrepresentations in a corporate press release. Because we find that the District
Court properly decided each of these issues, we will affirm.1
Section 10(b) of the Securities Exchange Act makes it unlawful to “use or employ,
in connection with the purchase or sale of any security . . . any manipulative or deceptive
device or contrivance in contravention of such rules and regulations as the Commission
may prescribe.” 15 U.S.C. § 78j(b). Rule 10b-5, promulgated pursuant to § 10(b),
provides that, in connection with the purchase or sale of any security, “[i]t shall be
unlawful for any person, directly or indirectly . . . [t]o make any untrue statement of a
material fact or to omit to state a material fact necessary in order to make the statements
1
The District Court exercised jurisdiction over this action pursuant to section 27 of the
Securities Exchange Act, 15 U.S.C. § 1331. Because the District Court entered a final order
granting summary judgment in favor of all defendants, we have jurisdiction pursuant to 28
U.S.C. § 1291.
Our review of a District Court’s order granting summary judgment is plenary. Camiolo v.
State Farm Fire & Cas. Co., 334 F.3d 345, 354 (3d Cir. 2003). We apply the standard set forth
in Federal Rule of Civil Procedure 56(c), under which we may affirm the District Court’s order
if, when viewing the evidence in the light most favorable to the non-moving party, there is “no
genuine issue as to any material fact and the moving party is entitled to judgment as a matter of
law.” Fed. R. Civ. P. 56(c).
4
made, in light of the circumstances under which they were made, not misleading....” 17
C.F.R. § 240.10b-5(b). To prove a violation of § 10(b) and Rule 10b-5, the plaintiff must
establish that the defendant, acting with knowledge or recklessness, made a
misrepresentation or omission of a material fact on which the plaintiff reasonably relied
and which resulted in damage. See In re Westinghouse Sec. Litig., 90 F.3d 696, 710 (3d
Cir. 1996).
There are two statements from the attached termination letter that are at issue in
this case: (1) “Unfortunately, we relied on that misleading information in determining to
enter the Merger Agreement,” and (2) “Consequently, whether intended or not, we
believe Tyson Foods, Inc. was inappropriately induced to enter into the Merger
Agreement.” For purposes of this appeal, the question is not whether these statements
are accurate or inaccurate, but rather, who made the statements and whether the maker of
the statements acted with the requisite scienter.
I. Primary Liability of Don and John Tyson
In Central Bank v. First Interstate Bank, 511 U.S. 164 (1994), the United States
Supreme Court addressed the availability of private claims based on secondary liability
pursuant to § 10(b) and held that there is no cause of action for aiding and abetting under
that section. Since Central Bank, courts have wrestled with the appropriate test to
determine whether an individual is primarily liable for a material misstatement or
omission. Whereas some courts have adopted a “bright line” test, which requires that the
5
defendant actually make the offending statement himself, others have embraced a
“substantial participation” test, which permits a finding of liability where the defendant
had a significant role in drafting or preparing the statements. Cf. Wright v. Ernst &
Young LLP, 152 F.3d 169, 175 (2d Cir. 1998); Howard v. Everex Sys., Inc., 228 F.3d
1057, 1061 n.5 (9th Cir. 2000). We need not decide here which is the more suitable test
because the Tysons cannot be held liable under either standard.
Although Don Tyson made the decision to terminate the Merger Agreement at a
meeting on March 28, 2001, he had no role in preparing or drafting the press release or
letter to IBP. Prior to that meeting, Les Baledge had obtained two independent opinion
letters from outside counsel stating that Tyson Foods had legal grounds to extricate itself
from the merger and relayed to Don and John Tyson only the bare-bones message that
Tyson Foods was legally entitled to terminate the agreement. Don Tyson did not inquire
further into the legal basis for termination, nor did he read the press release or letter to
IBP. It therefore cannot fairly be said that he substantially participated in making the
statements contained in the press release.
Similarly, John Tyson did not actually make the alleged misrepresentations, nor
did he substantially participate in their preparation. After the decision to terminate was
made, John Tyson told Baledge “to proceed with whatever he needed to do in his role as
legal representative of the company to execute the action.” He did not ask Baledge how
he intended to proceed, nor did he otherwise instruct him regarding the contents of the
6
letter. John Tyson did not review the press release or letter prior to their issuance. Like
Don Tyson, John Tyson did not “make” the alleged misrepresentations under § 10(b).
Because neither of the Tysons made or substantially participated in making the statements
contained in the letter and press release, we will affirm the District Court’s order granting
summary judgment with respect to their liability.
II. Primary Liability of Les Baledge
Les Baledge’s involvement in the publication of the press release and termination
letter raises a different issue. As General Counsel, Baledge was charged with issuing the
press release and termination letter. The documents were drafted by outside counsel with
Baledge’s input, and Baledge signed the letter. Thus, Baledge “made” the statements
included in those documents for purposes of Rule 10b-5. Nevertheless, in order for
liability to attach, the Shareholders must be able to show that Baledge made the
statements with “‘reckless disregard for [their] truth or falsity’ or with a lack of a
‘genuine belief that the information disclosed was accurate and complete in all material
respects.’” Eisenberg v. Gagnon, 766 F.2d 770, 776 (3d Cir. 1985) (citations omitted).
The recklessness standard is designed to “discourag[e] deliberate ignorance and prevent[]
defendants from escaping liability solely because of the difficulty of proving conscious
intent to commit fraud.” In re Advanta Corp. Sec. Litig., 180 F.3d 525, 535 (3d Cir.
1999) (citations omitted). To be reckless, a statement must “involv[e] not merely simple,
or even inexcusable negligence, but an extreme departure from the standards of ordinary
7
care, . . . which present[] a danger of misleading buyers or sellers that is either known to
the defendant or so obvious that the actor must have been aware of it.” Id. (citations
omitted).
The statements in the press release and letter did not purport to explain every
conceivable reason for terminating the agreement, but rather simply served to provide the
legal grounds for Tyson Foods’ decision to back out of the agreement. In asserting these
grounds, Baledge did not engage in an “extreme departure from the standards of ordinary
care,” but rather, reasonably relied upon his knowledge of the facts and circumstances
relating to IBP’s financial restatements and the qualified opinions of two outside law
firms. Baledge’s failure to inquire about Tyson Foods’ business reasons for terminating
the Merger Agreement and to include those reasons in the termination letter does not bear
on his good faith in asserting the legal grounds for termination. As the District Court
aptly explained, “omission of the business rationale does not render the disclosure of
Tyson Foods’ legal rationale materially misleading.” In re Tyson Foods, Inc. Sec. Litig.,
No. 01-425-SLR, at 25-26 (D. Del. June 17, 2004).
III. Primary Liability of Tyson Foods
Having concluded that there is no primary liability on the part of any of the
individual officers, the District Court properly held that Tyson Foods could not itself be
primarily liable under the facts of this case. See, e.g., Southland Sec. Corp. v. INSpire
8
Ins. Solutions, Inc., 365 F.3d 353, 366 (5th Cir. 2004); Nordstrom, Inc. v. Chubb & Son,
Inc., 54 F.3d 1424, 1435 (9th Cir. 1995).
IV. Conclusion
For the reasons set forth above, we find that the District Court properly entered
summary judgment on behalf of Don and John Tyson, Les Baledge, and Tyson Foods,
Inc. We will therefore affirm the judgment in their favor.
| {
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ACCEPTED
03-15-00281-CR
6682076
THIRD COURT OF APPEALS
AUSTIN, TEXAS
8/27/2015 1:42:07 PM
JEFFREY D. KYLE
CLERK
NO. 03-15-00281-CR
(Trial Court No. C-10-0321-SB) FILED IN
3rd COURT OF APPEALS
AUSTIN, TEXAS
IN THE 8/27/2015 1:42:07 PM
COURT OF APPEALS JEFFREY D. KYLE
FOR THE THIRD SUPREME JUDICIAL DISTRICT OF TEXASClerk
________________________________________________________________
PEDRO PEREZ MORALES,
Appellant.
VS.
THE STATE OF TEXAS,
Appellee.
__________________________________________________________________
From the 340TH Judicial District Court
of Tom Green County, Texas
Honorable Brock Jones, Senior Judge Presiding
__________________________________________________________________
BRIEF OF APPELLANT
__________________________________________________________________
ORAL ARGUMENT NOT REQUESTED
KIRK HAWKINS
17 South Chadbourne, Suite 401
P.O. Box 3645
San Angelo, Texas 76902
325-658-5585
State Bar No. 09250400
E-Mail: [email protected]
ATTORNEY FOR APPELLANT
1
TABLE OF CONTENTS
Page
TABLE OF CONTENTS…………………………………………………….. 2
LIST OF AUTHORITIES……………………………………………………. 3
NAMES OF ALL PARTIES…………………………………………………. 5
STATEMENT OF THE CASE………………………………………………. 5
STATEMENT OF THE EVIDENCE………………………………………… 7
SUFFICIENCY OF THE EVIDENCE……………………………………….. 12
OBJECTIONS………………………………………………………………… 13
EFFECTIVENESS OF COUNSEL…………………………………………… 13
CONCLUSION……………………………………………………………….. 14
CERTIFICATE OF SERVICE……………………………………………….. 15
2
LIST OF AUTHORITIES
CASES Page
Anders v. California 386 US 738, 87 S. Ct. 1396, 18 L.Ed 2nd 493 7
(1963)
Autran v. State 887 SW2d 31 (Tx. Crim.App. 1994) 13,14
High v. State 573 SW2d 807 (Tx.Crim.App. 1978 7
Madison v. State 922 SW2d 610 CCA Texarkana 1996 14
Stafford v. State 813 SW2d 503 (Tx.Crim.App. 1991) 7,13
Strickland v. Washington 466 US 668, 104 S.Ct. 2052, 80 L.Ed.2d
674 (1984) 13
Trujillo v. State 952 SW2d 879 CCA Dallas 1997 14
STATUTES
Texas Penal Code, Section 49.07 5
3
NO. 03-15-00281-CR
(Trial Court No. C-10-0321-SB)
IN THE
COURT OF APPEALS
FOR THE THIRD SUPREME JUDICIAL DISTRICT OF TEXAS
________________________________________________________________
PEDRO PEREZ MORALES,
Appellant.
VS.
THE STATE OF TEXAS,
Appellee.
__________________________________________________________________
From the 340th Judicial District Court
of Tom Green County, Texas
Honorable Brock Jones, Senior Judge Presiding
_________________________________________________________________
BRIEF OF APPELLANT
__________________________________________________________________
TO THE HONORABLE COURT OF APPEALS FOR THE THIRD SUPREME
JUDICIAL DISTRICT OF TEXAS:
COMES NOW, PEDRO PEREZ MORALES, by and through his court-
appointed attorney, the Appellant in the above-entitled and numbered cause, and
files this Brief of Appellant, and in support thereof would show this Honorable
4
Court as follows:
NAMES OF ALL PARTIES
In order that the members of the Court may determine disqualifications or
refusal pursuant to Rule 74(a) of the Texas Rules of Appellate Procedure,
Appellant certifies that the following is a complete list of all parties interested in
the outcome and their attorneys of record:
1. Appellant, PEDRO PEREZ MORALES, TDCJ# 01987931, Wheeler State
Jail, 986 County Road AA, Plainview, Texas 79072.
2. Defense and trial attorney, JIMMY STEWART, State Bar No. 19211300,
101 South Park Street, San Angelo, Texas 76901.
3. Attorney of record on appeal for Appellant, KIRK HAWKINS, State Bar
No. 09250400, P.O. Box 3645, San Angelo, Texas 76902.
4. The Honorable Brock Jones, Trial Judge, Tom Green County Courthouse,
112 West Beauregard, San Angelo, Texas 76903.
5. Appellee, STATE OF TEXAS, represented by Mr. Jason David Ferguson,
Assistant District Attorney, Tom Green County Courthouse, Court Street
Annex, 124 West Beauregard, San Angelo, Texas 76903.
STATEMENT OF THE CASE
The Appellant, PEDRO PEREZ MORALES, was indicted on March 29,
2009 for the offense of intoxicated assault with a motor vehicle causing serious
bodily injury, Penal Code Section 49.07, a third degree felony (CR p. 8). On
January 26, 2011, Appellant was found guilty and sentenced to ten (10) years in
5
the Institutional Division of the Texas Department of Criminal Justice.
Appellant’s sentence was suspended and Appellant was placed on probation for ten
(10) years (CR p. 19). On May 18, 2012, Appellant’s probation was revoked and
he was sentenced to ten (10) years in the Institutional Division of the Texas
Department of Criminal Justice, fined $2,000.00, and restitution of $5,931.28 (CR
p. 57). On October 4, 2012, the Court entered an order reinstating his probation
(shock probation) which required the Appellant to participate in the SAFPF
Program (CR p. 74-76). The State filed a motion to revoke Appellant’s probation
once again on September 26, 2014 (CR 95). The motion to revoke was heard on
March 12, 2015 before the Honorable Brock Jones, Senior Judge (RR p. 5). The
motion to revoke listed seven (7) violations including: 1) failure to make
payments; 2) failure to submit a statement of inability to pay; 3) driving while
license invalid; 4) possession of a firearm by a felon; 5) displaying fictitious motor
vehicle registration; 6) failure to pay urinalysis fees; 7) operating a motor vehicle
in violation of the terms and conditions of his probation. Appellant entered a plea
of not true (RR p. 8, l. 9). After hearing testimony, the Court found all seven of the
allegations true and revoked Appellant’s probation and sentenced him (RR p. 41, l.
7 and p. 47, l. 16).
Counsel has reviewed the record and spoken with both counsel for the
Appellant and the State’s Assistant District Attorney who tried the case. Counsel
6
can find no arguable grounds on which to appeal. Counsel will attempt to comply
with the guidelines regarding such appeals set forth in High v. State 573 SW2d 807
(Tx.Crim.App. 1978), Anders v. California 386 US 738, 87 S. Ct. 1396, 18 L.Ed
2nd 493 (1963), and Stafford v. State 813 SW2d 503 (Tx.Crim.App. 1991).
The record consists of the Clerk’s record in one (1) volume of 123 pages
which will be referred to as (CR), and the reporter’s record which consists of one
(1) volume which will be referred to as (RR).
STATEMENT OF THE EVIDENCE
The State called Alyssa Barton, an officer with Concho Valley Community
Supervision and Corrections Department, who testified that she was Appellant’s
SAFPF aftercare officer (RR p. 9). She testified that Appellant had failed to make
the payments as alleged in paragraph III, paragraph 1 of the State’s motion to
revoke (RR p. 10, l. 17) and that Appellant had failed to submit inability to pay
statements as alleged in paragraph 2 (RR p. 11, l. 4). She further testified that
Appellant violated the laws of the State of Texas in that he was arrested for driving
while license invalid, displaying a false inspection sticker, and being a felon in
possession of a firearm (RR p. 11-13). She also testified that he failed to pay his
urinalysis fees (RR p. 11, l. 17 through p. 12, l. 3). She also testified that one of
the conditions of his probation was that he was not to drive (RR p. 12, l. 4-9). She
testified that Appellant had failed to pay the restitution of $5,931.28 and still owed
7
$5,774.78 (RR p. 12, l. 10-19). The Court quickly pointed out that the failure to
pay restitution was not alleged in the motion to revoke, and the State agreed that it
was irrelevant (RR p. 12, l. 21). On cross-examination, she admitted that she had
only been Appellant’s probation officer since September 2014. She also indicated
that Appellant had successfully completed the SAFPF Program, the Clover House
Transitional Treatment Center program, and the aftercare program (RR p. 13).
The State also called Patrick Eugene Garrett, a police officer with the San
Angelo Police Department (RR p. 14). He testified that on September 13, 2014,
while on patrol, he located a vehicle traveling on West Harris and ran the license
plate and it came back that the license had expired in March 2014 (RR p. 14, l. 22
through p. 15, l. 7).
He identified the Appellant as the driver of the vehicle and he also identified
the two passengers. He stated that the driver was not able to provide insurance on
the vehicle and he noticed that the inspection sticker had been altered and that a
number five (5) had been cut out of something and taped over the year number on
the sticker. He testified that this was a class B misdemeanor in violation of the
Traffic Code (RR p. 15). He testified that he inquired of the Appellant as to the
ownership of the vehicle and Appellant stated the vehicle hadn’t been switched
over to his name yet (RR p. 16, l. 23). Dispatch information the officer that
Appellant had an invalid driver’s license with two prior convictions for driving
8
while license invalid. At that time he placed Appellant under arrest for driving
while license invalid with previous convictions, no insurance, and displaying a
fictitious registration sticker (RR p. 17, l. 6-16). He explained that department
policy was not to release a vehicle with no insurance to a third party (RR p. 18, l.
8-15). He and the other attending officer then inventoried the vehicle. He testified
that throughout the course of the inventory of the trunk, they located DVDs and
electronic items, all in their packaging with price tags on them (RR p. 18, l. 20-25).
He testified that Officer Faz located a black bag which contained a loaded Ruger
23 revolver with four (4) .22 caliber rounds inside the gun (RR p. 19, l. 1-5). He
read the Appellant his Miranda rights, and Appellant advised him that the black
bag was his bag (RR p. 19, l. 23-25). He stated that Appellant said the only item in
the trunk that belonged to him was a black bag which contained an extra set of
keys and a cell phone (RR p. 20, l. 5-9). Appellant also denied any knowledge of
the firearm or any of the other items located in the trunk, and claimed that he had
recently loaned his vehicle to a friend (RR p. 20, l. 10-14). The officer read the
Miranda rights to the Appellant and explained that the only thing the Appellant
claimed was his was the black bag (RR p. 20, l. 19 through p. 21, l. 1).
On cross-examination the witness testified that he did run the title to the
vehicle and it was not in Appellant’s name, but he could not remember the name of
the owner (RR p. 22, l. 16-25).
9
The State called Officer Matthew John Faz who testified he had been with
the San Angelo Police Department since 2013 (RR p. 25, l. 19). He testified that
during the inventory search, he saw a small black sack bag “like one of those little
things that you pull open, like a sack bag, and it was on the passenger side of the
vehicle in that little cubby hole where, I guess, where the wheel tire is, and during
the inventory I was checking the bag and that’s when I found the handgun inside.”
(RR p. 27, l. 12-20). He testified it was a .22 caliber and it appeared to be a real
firearm (RR p. 28, l. 1, 10). He also testified that the bag was in plain view (RR p.
28, l. 17-18).
On cross-examination, Appellant’s counsel was able to get the officer to
finally state that it was a Ruger .23 caliber pistol (RR p. 29, l. 19-23).
The Appellant himself testified that he was driving a Lincoln and he had two
passengers, Ms. Rivas and a friend of his, Stephanie Dodson (RR p. 31). He
testified that he could not remember why he was pulled over, but it probably had
something to do with the registration being out. He stated he was not aware that
the registration had expired. He further testified that the title to the vehicle was in
the name of Timothy Salazar and that he was a friend of his from his aftercare
program from SAFPF (RR p. 32). He stated he had just had possession of the
vehicle for a couple of hours (RR p. 33, l. 2, 3). He then stated it was his
girlfriend’s car and he had occasionally driven it and he did not consider it his car
10
(RR . p. 33, l. 7-14). He denied telling the officer it was his car and denied
knowing what was in the trunk of the vehicle (RR . p. 33, l. 15-25). He also stated
he did not know there was a black bag in the trunk nor that there was a firearm in
the trunk (RR p. 34, l. 1-4).
On cross-examination Appellant again denied telling the officer that it was
his vehicle and he said he never told the officer that the black bag was his (RR p.
34). He admitted he was driving that night and that the owner of the car was his
girlfriend, and he thought she had had the vehicle for a few months and that he had
driven it maybe two or three times (RR p. 35). He further admitted that he
understood the terms and conditions of his probation (RR p. 35, l. 18-21); that he
had not made payments for the nine months alleged (RR p. 36, l. 3-10). He also
admitted that he had not filled out the inability to pay forms for those months (RR
p. 36, l. 11-15), and admitted that he did not have a valid driver’s license when he
was pulled over (RR p. 36, l. 18-20). He also admitted that he had not paid the
urinalysis fees (RR p. 36, l. 22 through p. 37, l. 5). He also understood that he was
not supposed to drive at all which was based on his original charge of intoxicated
assault with a vehicle (RR p. 37, l. 6-14).
On the punishment phase, the State recalled Alyssa Barton, Appellant’s
community supervision officer. She testified that the Appellant was adjudicated
and given ten (10) years community supervision on January 6, 2011. A motion to
11
revoke was filed on January 13, 2012 when he was arrested for driving while
intoxicated and driving while license suspended. She further testified that his
probation was revoked on May 8, 2012 and was sentenced to ten (10) years in
prison. On September 24, 2012, Appellant was granted shock probation and sent
to SAFPF as a condition of his probation. She testified that he completed SAFPF
on June 18, 2013, the halfway house or transitional treatment center on September
16, 2013, and then on March 24, 2014, he completed the aftercare program (RR p.
42, l. 19 through p. 43, l. 10).
SUFFICIENCY OF THE EVIDENCE
The burden of proof on a motion to revoke is by a preponderance of the
evidence. In paragraph III of the motion to revoke, the State alleged seven (7)
violations. The Appellant admitted to violation 1 in failing to make payments; to
violation 2 for failing to submit his financial inability to pay statements; to
violation 3 for driving while license invalid; violation 6 for failure to pay urinalysis
fees; and violation 7 for operating a motor vehicle during the term of his
community supervision.
Concerning allegation number 4 – possession of a firearm by a felon, and
number 5 – displaying a fictitious motor vehicle registration, the Court has the
discretion to believe either the Appellant or the officers who made the stop and
12
conducted the search. Counsel believes that the evidence was sufficient to sustain
the revocation of Appellant’s probation.
OBJECTIONS
There were no objections made by either the State nor Appellant’s counsel
during the course of the trial.
EFFECTIVENESS OF COUNSEL
Appellant’s counsel cross-examined Officer Garrett as to each of the
statements he attributed to the Appellant during the initial stop and during the
formal questioning after Garrett had read Appellant his Miranda rights. He cross-
examined Officer Faz regarding the exact location of the black bag which Faz
found in the trunk of the vehicle. Based on the conduct at the trial, trial counsel’s
performance exceeded the standards of effectiveness of counsel based on the
definition of ineffective assistance of counsel as per Stafford v. State 813 SW2d
503 (Tx. Crim. App. 1991) and Strickland v. Washington 466 US 668, 104 S.Ct.
2052, 80 L.Ed.2d 674 (1984).
The only possible issue counsel did not address was regarding the inventory
search in the opening of the bag. While testimony was not clear whether the bag
was open and the gun might have been in plain view, there was no motion to
suppress filed nor was the issue raised at the trial. In accordance with Autran v.
State 887 SW2d 31 (Tx. Crim.App. 1994), an inventory search would not allow the
13
officers to open any closed containers in the vehicle. Although Autran stands for
this principle, it is ab plurality opinion and several Courts of Appeals have not
chosen to follow it and have ruled contrary that if there is a policy for inventory
searches to be conducted on vehicles that are going to be impounded, the officers
could inspect the contents of any closed containers. Trujillo v. State 952 SW2d
879 CCA Dallas 1997, Madison v. State 922 SW2d 610 CCA Texarkana 1996.
Counsel is of the opinion, because of the overwhelming evidence and the
admissions of the Appellant as to the other allegations alleged in the State’s motion
to revoke, that this point is irrelevant.
CONCLUSION
After reviewing the record of the case, Appellant counsel can find no
reversible error.
Respectfully submitted,
___/s/ Kirk Hawkins___________________
KIRK HAWKINS
P.O. BOX 3645
SAN ANGELO, TEXAS 76902
325/658-5585
STATE BAR NO. 09250400
E-Mail: [email protected]
14
CERTIFICATE OF SERVICE
I certify that a true and correct copy of the above was served on Mr. Jason
David Ferguson, Assistant District Attorney, Tom Green County Courthouse,
Court Street Annex, 124 West Beauregard, San Angelo, Texas 76903; and on
Appellant, Mr. Pedro Perez Morales, TDCJ#01987931, Wheeler State Jail, 986
County Road AA, Plainview, Texas 79072, on this 27th day of August, 2015.
I further certify that I have mailed a notice to the Appellant at the above-
referenced address on August 27, 2015, informing of my intention of filing a
frivolous appeal and advising him of his rights to file his own brief and to review
the record.
__/s/ Kirk Hawkins ______________
Kirk Hawkins
NOTICE TO APPELLANT, PEDRO PEREZ MORALES
YOU HAVE THE RIGHT TO FILE YOUR OWN BRIEF IN THIS
CAUSE. YOU ALSO HAVE THE RIGHT TO REVIEW THE COURT
RECORD AND THE COURT REPORTER’S RECORD. YOU HAVE
THIRTY (30) DAYS FROM THE DATE OF THE FILING OF THIS BRIEF
IN WHICH TO PREPARE AND SUBMIT YOUR OWN BRIEF.
__/s/ Kirk Hawkins___________________
Kirk Hawkins
15
ACCEPTED
03-15-00281-CR
6682076
THIRD COURT OF APPEALS
AUSTIN, TEXAS
8/27/2015 1:42:07 PM
JEFFREY D. KYLE
CLERK
NO. 03-15-00281-CR
(Trial Court No. C-10-0321-SB)
IN THE
COURT OF APPEALS
FOR THE THIRD SUPREME JUDICIAL DISTRICT OF TEXAS
________________________________________________________________
PEDRO PEREZ MORALES,
Appellant.
VS.
THE STATE OF TEXAS,
Appellee.
__________________________________________________________________
From the 340th Judicial District Court
of Tom Green County, Texas
Honorable Brock Jones, Senior Judge Presiding
________________________________________________________________
CERTIFICATE OF WORD COMPLIANCE
_________________________________________________________________
TO THE HONORABLE COURT OF APPEALS FOR THE THIRD SUPREME
JUDICIAL DISTRICT OF TEXAS:
COMES NOW, KIRK HAWKINS, court-appointed attorney for Appellant
PEDRO PEREZ MORALES, and files this Certificate of Word Compliance, and
would submit the following:
Pursuant to Texas Rule of Appellate Procedure 9.4(i)(3), I hereby certify that
this brief contains 2,522 words (excluding the caption, table of contents, table of
authorities, signature, proof of service, certification, and certificate of compliance).
This is a computer-generated document created in Microsoft Word, using 14-point
typeface for all text, except for footnotes which are in 12-point typeface. In making
this certificate of compliance, I am relying on the word count provided by the
software used to prepare the document.
Respectfully submitted,
___/s/ Kirk Hawkins________________
KIRK HAWKINS
P.O. BOX 3645
SAN ANGELO, TEXAS 76902
325/658-5585
STATE BAR NO. 09250400
E-Mail: [email protected]
CERTIFICATE OF SERVICE
I certify that a true and correct copy of the above was served on Mr. Jason
Ferguson, Assistant District Attorney, Tom Green County Courthouse, Court
Street Annex, 124 West Beauregard, San Angelo, Texas 76903; and on Appellant,
Pedro Perez Morales #01987931, Wheeler State Jail, 986 County Road AA,
Plainview, Texas 79072 on this 27th day of August, 2015.
___/s/ Kirk Hawkins________________
Kirk Hawkins
ACCEPTED
03-15-00281-CR
6682076
THIRD COURT OF APPEALS
AUSTIN, TEXAS
8/27/2015 1:42:07 PM
JEFFREY D. KYLE
CLERK
No. 03-15-00281-CR
PEDRO PEREZ MORALES, ) IN THE COURT OF APPEALS
Appellant )
)
V. ) THIRD JUDICIAL DISTRICT
)
THE STATE OF TEXAS, )
Appellee ) SITTING AT AUSTIN, TEXAS
CERTIFICATE OF COUNSEL
In compliance with the requirements of Anders v. California, 386 U.S. 378
(1967), I, Kirk Hawkins, court-appointed counsel for Appellant, PEDRO PEREZ
MORALES, in the above-referenced appeal, do hereby certify, in writing, to the
Court that I have:
1. Notified Appellant that I filed a motion to withdraw as counsel with an
accompanying Anders brief, and provided a copy of each to Appellant;
2. Informed Appellant of his right to file a pro se response identifying what he
believes to be meritorious grounds to be raised in his appeal, should he so
desire;
3. Advised Appellant of his right to review the appellate record, should he wish
to do so, preparatory to filing that response;
4. Explained the process for obtaining the appellate record, provided a Motion
for Pro Se Access to the Appellate Record lacking only appellant’s signature
and the date, and provided the mailing address for this Court; and
5. Informed appellant of his right to seek discretionary review pro se should
this Court declare his appeal frivolous.
Respectfully submitted,
___/s/ Kirk Hawkins____________
KIRK HAWKINS
P.O. BOX 3645
SAN ANGELO, TEXAS 76902
325-658-5585
STATE BAR NO. 09250400
E-Mail: [email protected]
ATTORNEY FOR APPELLANT
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FILED
NOT FOR PUBLICATION SEP 08 2011
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U .S. C O U R T OF APPE ALS
FOR THE NINTH CIRCUIT
ARTHUR GRADY GARNER, No. 09-17862
Petitioner - Appellant, DC No. 4:99-cv-02863-CW
v.
MEMORANDUM *
B.A. MAYLE,
Respondent - Appellee.
Appeal from the United States District Court
for the Northern District of California
Claudia A. Wilken, District Judge, Presiding
Argued and Submitted July 20, 2011
San Francisco, California
Before: HUG and RAWLINSON, Circuit Judges, and RAKOFF, Senior
District Judge.**
Petitioner Arthur Grady Garner (“Garner”) appeals from the district court’s
judgment denying his 28 U.S.C. § 2254 petition for a writ of habeas corpus. We
have jurisdiction under 28 U.S.C. § 2253. Because the parties are familiar with the
*
This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
**
The Honorable Jed S. Rakoff, Senior United States District Judge for
the Southern District of New York, sitting by designation.
factual and procedural history of this case, we do not recount additional facts
except as necessary to explain the decision. We affirm.
Garner alleges that the district court abused its discretion in declining to hold
an evidentiary hearing on Garner’s ineffective assistance of counsel claim. He
argues that he received ineffective assistance of counsel because his trial counsel
purportedly failed to investigate facts which would have impeached the testimony
of the informant, Arthur Ray. We disagree. As an initial matter, because trial
counsel is now deceased, Garner has offered no direct evidence concerning the
scope or quality of trial counsel’s investigation. Garner’s argument, therefore, is
premised entirely on current counsel’s discovery of “new evidence” that was not
presented to the jury. As the district court found, however, this evidence is either
speculative or cumulative of the evidence that was admitted at trial. A fitting
example is the March 26, 1992 affidavit signed by Michael Anthony, an inmate
housed at the same facility as Garner. In that affidavit, Anthony avers that he
notified Garner that Ray was a well-known jail house informant. This evidence,
however, is cumulative of Garner’s testimony that he knew Ray was an informant
and Ray’s own testimony that he was a professional police informant paid $50 for
each court appearance. Accordingly, even accepting all of Garner’s allegations as
true, they would not show that his trial counsel’s investigation was unreasonable or
2
that his performance fell below an objectively reasonable standard. See Strickland
v. Washington, 466 U.S. 668, 695 (1984).
Moreover, to make out a claim for ineffective assistance of counsel, Garner
must show that “there is a reasonable probability that, but for counsel's
unprofessional errors, the result of the proceeding would have been different.” Id.
at 698. In this case, the evidence against Garner included, among other things, the
victim’s identification of Garner as the shooter. Also, as indicated above, Ray’s
testimony was already thoroughly impeached. Accordingly, none of Garner’s
allegations, if proven, would entitle him to relief, and the district court therefore
did not abuse its discretion in denying Garner’s claim without an evidentiary
hearing. See, e.g., West v. Ryan, 608 F.3d 477, 485 (9th Cir. 2010); (“To obtain an
evidentiary hearing in district court, a habeas petitioner must . . . allege a colorable
claim for relief.”); Cassett v. Stewart, 406 F.3d 614, 624 (9th Cir. 2005) (holding
that “a federal court may deny an unexhausted habeas petition on the merits . . .
when it is perfectly clear that the applicant does not raise even a colorable federal
claim”).
We have considered the appellants’ additional arguments and find them to
be without merit. In particular, Garner’s uncertified claim is ummeritorious and
we decline to address it. See 9th Cir. R. 22-1(e).
3
AFFIRMED.
4
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226 Ga. 688 (1970)
177 S.E.2d 77
GATRELL
v.
EMPLOYERS MUTUAL LIABILITY INSURANCE COMPANY et al.
25867.
Supreme Court of Georgia.
Submitted July 14, 1970.
Decided September 10, 1970.
Rehearing Denied September 24, 1970.
George & George, William V. George, for appellant.
Swift, Currie, McGhee & Hiers, James T. McDonald, Jr., for appellees.
*689 MOBLEY, Presiding Justice.
This court granted certiorari to review the decision of the Court of Appeals in Gatrell v. Employers Mut. Liab. Ins. Co., 121 Ga. App. 467 (174 SE2d 237). The judgment in that case affirmed the judgment of the superior court, which held that an award of the State Board of Workmen's Compensation was not accompanied by a statement of its findings of fact as required by law, and remanded the case to the board for "findings of fact and other matters pertinent to the issue," and an award based thereon. The applicant for certiorari, the claimant in the case, contends that the trial court and the Court of Appeals, erred in holding that no sufficient findings of fact were made by the board.
The matter was heard originally by a deputy director, who made findings of fact and an award, as provided by Code § 114-707. The employer and the insurance carrier filed an appeal to the full board.
The notice of award by a majority of the full board stated: "After hearing argument and after careful consideration of the entire record the majority of the full board is of the opinion that the award of the deputy director should be amended by adding the following findings of fact to page three as the second paragraph of the award of the deputy director: We further find as a matter of fact that the employer had notice of an accident which produced an injury although it was not aware of the evident nature of the injury. We therefore find that the employee was excused from giving any further notice of the injury than that which he had previously given since the employer was not prejudiced thereby. The remainder of the award of the deputy director dated October 21, 1968, is hereby made the award of the full board."
When the appeal was made to the full board, the board had a discretion as to whether it would hear additional testimony or pass anew upon the evidence introduced before the Deputy Director. Young v. American Ins. Co., 110 Ga. App. 269 (1) (138 SE2d 385). There is no indication from the record that the parties introduced additional evidence at the hearing before the full board. The hearing before the full board is a de novo proceeding, and the board is required to make findings of fact on *690 which to base its decision. It could either adopt the deputy director's findings of fact as its own findings, or make independent and different findings of fact from the evidence heard by the deputy director. Pacific Employers Ins. Co. v. West, 213 Ga. 296 (1) (99 SE2d 89); American Casualty Co. v. Wilson, 99 Ga. App. 219 (1) (108 SE2d 137); E. Z. Shop Curb Service Shop v. Pearce, 100 Ga. App. 785 (2) (112 SE2d 412).
The Court of Appeals has previously held that the findings of fact in the report of the Board of Workmen's Compensation are filed in order that the losing party may intelligently prepare his appeal, that "legal precision and nicety in the report should not be insisted upon," and if the report is subject to two constructions, one of which would render the award invalid, and one of which would with equal reason render it valid, it "should be construed, after judgment, to be that which will make the judgment valid." Southeastern Exp. Co. v. Edmondson, 30 Ga. App. 697, 700, 703 (119 SE 39); Maryland Cas. Corp. v. Mitchell, 83 Ga. App. 99, 101 (62 SE2d 415); Pacific Employers Ins. Co. v. West, 97 Ga. App. 392, 396 (103 SE2d 130); Lee v. General Accident Group, 112 Ga. App. 197, 199 (144 SE2d 457); Chattahoochee Camp School v. Cole, 117 Ga. App. 505, 507 (161 SE2d 78).
The report of the board in the present case did not precisely state that the findings of fact of the Deputy Director were adopted. It added a paragraph to the findings of fact of the deputy director and stated that the "remainder of the award" is made the award of the full board. The only reasonable construction of this report is that the findings of fact of the deputy director were adopted, after amendment by the paragraph set out in the report. It was error for the trial judge to remand the case for findings of fact, and the Court of Appeals erred in affirming that judgment.
Judgment reversed. All the Justices concur.
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Case: 15-40491 Document: 00513332655 Page: 1 Date Filed: 01/06/2016
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
FILED
No. 15-40491 January 6, 2016
Summary Calendar
Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA,
Plaintiff-Appellee
v.
JOSE LUIS IRAHETA,
Defendant-Appellant
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 1:14-CR-927-1
Before DAVIS, JONES, and DENNIS, Circuit Judges.
PER CURIAM: *
Jose Luis Iraheta appeals the sentence imposed following his conviction
for illegal reentry into the United States in violation of 8 U.S.C. § 1326. He
contends that the district court erred in applying the crime-of-violence (COV)
enhancement under U.S.S.G. § 2L1.2(b)(1)(A)(ii) based on his 2006 conviction
for infliction of corporal injury on a spouse or cohabitant under California
Penal Code § 273.5(a). He acknowledges that we have held that an offense
* 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.
Case: 15-40491 Document: 00513332655 Page: 2 Date Filed: 01/06/2016
No. 15-40491
under § 273.5(a) categorically qualifies as a COV under § 2L1.2 in United
States v. Cruz-Rodriguez, 625 F.3d 274, 276 (5th Cir. 2010), and United States
v. Gutierrez, 371 F. App’x 550, 551 (5th Cir. 2010), but he argues that these
cases were overruled by Descamps v. United States, 133 S. Ct. 2276 (2013), and
that we ignored a conflicting Ninth Circuit case, Morales-Garcia v. Holder, 567
F.3d 1058, 1063 (9th Cir. 2009).
Iraheta argues that Descamps precludes application of the modified
categorical approach, but he does not explain why the modified categorical
approach would need to be applied, when we have already held that the
statute, by its very terms, is a categorical COV because the use of physical force
against the person of another is an element of the statute. See Cruz-Rodriguez,
625 F.3d at 276. The decision in Morales-Garcia, 567 F.3d at 1064-67, was
based on the law pertaining to crimes of moral turpitude in the immigration
context and is irrelevant to the determination whether the statute is a COV
under the use of force prong rather than the enumerated offense prong in
§ 2L1.2.
In reviewing a challenge to a COV enhancement that was preserved in
the district court, we review the district court’s factual findings for clear error
and its interpretation and application of the Sentencing Guidelines de novo.
United States v. Chacon, 742 F.3d 219, 220 (5th Cir. 2014). “A factual finding
is not clearly erroneous if it is plausible in light of the record as a whole.”
United States v. Coleman, 609 F.3d 699, 708 (5th Cir. 2010).
We have held that an offense under § 273.5(a) categorically qualifies as
a COV under § 2L1.2 because it has as an element the use, attempted use, or
threatened use of physical force against the person of another. Cruz-
Rodriguez, 625 F.3d at 276. We cited with approval our prior
unpublished opinion in Gutierrez and the Ninth Circuit’s decision in
2
Case: 15-40491 Document: 00513332655 Page: 3 Date Filed: 01/06/2016
No. 15-40491
United States v. Laurico-Yeno, 590 F.3d 818 (9th Cir. 2010), which rejected the
argument that a conviction under § 273.5(a) does not qualify as a COV because
it could have been committed merely by minimal, non-violent touchings. See
Laurico-Yeno, 590 F.3d at 821-22; Gutierrez, 371 F. App’x at 551. The cases
interpreting the statute have held that a defendant can be convicted of § 273.5
only if he intentionally uses direct physical force against the person of another
resulting in a traumatic condition. See Cruz-Rodriguez, 625 F.3d at 276;
Laurico-Yeno, 590 F.3d at 821-23; Banuelos-Ayon v. Holder, 611 F.3d 1080,
1083-85 (9th Cir. 2010); United States v. Ayala-Nicanor, 659 F.3d 744, 749-52
(9th Cir. 2011). “The critical aspect of [18 U.S.C.] § 16(a) is that a crime of
violence is one involving the ‘use ... of physical force against the person or
property of another.’” Leocal v. Ashcroft, 543 U.S. 1, 9 (2004). Iraheta’s
argument that § 273.5 is a simple battery and not in the category of a violent
crime as defined in Leocal has also been rejected by the previously cited
authorities.
None of Iraheta’s arguments shows that our decision in Cruz-Rodriguez
has been overruled by the Supreme Court or this Circuit en banc. See United
States v. Segura, 747 F.3d 323, 328 (5th Cir. 2014).
The Government has moved for summary affirmance. Summary
affirmance is not appropriate, and the Government’s motion is DENIED. See
United States v. Holy Land Found. for Relief and Dev., 445 F.3d 771, 781 (5th
Cir. 2006). The Government’s alternative motion for an extension of time to
file a brief is also DENIED, as Iraheta is not entitled to relief and further
briefing is unnecessary.
The judgment of the district court is AFFIRMED.
3
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795 F.2d 1187
CONTINENTAL CASUALTY COMPANY, Appellant,v.William S. BURTON, Audrey H. Buckner, Mary R. Thweatt, Appellees.
No. 85-1987.
United States Court of Appeals,Fourth Circuit.
Argued April 9, 1986.Decided July 21, 1986.
Philip J. Walsh (Charles J. O'Hara, Bromley, Brown & Walsh, Washington, D.C., on brief) for appellant.
Christopher M. Malone (Thompson & McMullan, Richmond, Va., on brief) for appellee Audrey H. Buckner.
Charles H. Cuthbert, Jr., Petersburg, Va., for appellee Mary R. Thweatt.
Before WINTER, Chief Judge, PHILLIPS, Circuit Judge, and BUTZNER, Senior Circuit Judge.
BUTZNER, Senior Circuit Judge:
1
Continental Casualty Company appeals an order of the district court that denied its application for a declaratory judgment. Continental sought to be absolved from liability to Mrs. Audrey Buckner and Mrs. Mary Thweatt under a legal professional's liability policy issued to William Burton, a lawyer. The district court held that Burton's conduct was covered by the policy, that Continental failed to prove facts establishing an exclusion from coverage, and that the defense of breach of the insured's duty to cooperate was not available to Continental. We affirm.
2
* In 1974, Burton assisted Mrs. Buckner, his cousin, in settling her husband's estate. At that time Mrs. Buckner entrusted funds to him which he said he would pool with other funds for investment in his name at a higher interest rate than her individual funds could bring. Mrs. Buckner was to receive income from her investment on a monthly basis. As compensation for his services, Burton was to receive a percentage of the gross income earned on the investment.
3
From 1974 to 1981, Mrs. Buckner delivered to Burton sums totaling $50,000. Burton signed various demand notes for the money he received. On September 15, 1982, he signed a demand note for the full $50,000, which stated that he held the money in trust for the benefit of Mrs. Buckner and that the note would bear interest at the rate being earned on a certificate of deposit 408-8 lodged with First Colonial Savings and Loan Association. From 1974 through December 1983, Burton sent Mrs. Buckner monthly checks, which represented her share of the interest earned by her money. During this period Burton also performed various legal services for Mrs. Buckner, for which he was compensated.
4
At one time Mrs. Buckner was under the impression that her money had been invested in certificate of deposit 408-8. She gained this impression only from the note, and she testified that Burton never told her that her money was invested in this certificate of deposit. Records from First Colonial disclose that such a certificate existed in Burton's name and that it was pledged by Burton as collateral for a loan on September 15, 1981. The certificate was redeemed by the institution on January 15, 1984, after Burton defaulted.
5
In November 1983, Mrs. Buckner asked for return of $10,000. Burton told her that her funds were in an investment which had not matured, but he could obtain her $10,000 if she really wanted it. Mrs. Buckner told Burton that she would not push for the money but as soon as the note came due she wanted to talk to him about handling her investments herself because the new office to which Burton was moving would be far from her home.
6
Burton visited Mrs. Buckner at her home on January 4, 1984. Mrs. Buckner's evidence is unclear whether she then demanded the return of all her funds or told Burton that she wanted to discuss the return of all her funds when the investment matured. She testified that she made no demand, but her complaint in a civil action against Burton alleged that she did.
7
Mrs. Buckner has not been able to contact Burton since that time. She has received no payments from him since December 1983 and has not been able to locate her funds. After learning of Burton's disappearance, Mrs. Buckner obtained a judgment against him in state court for $50,000.
8
In early 1982, Burton represented Mrs. Thweatt in connection with the estate of her husband. Between January 6 and March 18, 1982, Mrs. Thweatt entrusted over $140,000 with Burton, for which he executed seven demand notes. Mrs. Thweatt's agreement with Burton was substantially the same as Mrs. Buckner's. Burton made monthly payments to Mrs. Thweatt as her share of the interest.
9
On January 6, 1984, Burton paid a visit to Mrs. Thweatt at her home, and she gave him a written demand for the return of her money by January 11. Burton replied that he would try to get her money for her. Mrs. Thweatt testified that because Burton was moving his office she thought he would be too far away for communication. Mrs. Thweatt has had no further contact with Burton since that time. On January 9, counsel for Mrs. Thweatt hand delivered to Burton's residence a letter demanding return of Mrs. Thweatt's funds by January 12. On January 20, 1984, Mrs. Thweatt filed an action against Burton in state court which resulted in a judgment against Burton for $140,000.
10
On January 9, 1984, Burton went to Colorado to visit a gold mining company in which he had invested.1 Around January 12, during a telephone conversation, Burton's wife informed him that Mrs. Thweatt's counsel had written to demand her funds. Burton dictated a letter that he would be in Colorado until the 17th and that payment would be made to Mrs. Thweatt on January 18. On January 18, Burton again spoke to his wife by telephone from Colorado. He told her that he would be home late the following evening. Nothing has been heard from Burton since he talked with his wife on January 18, 1984. The parties have stipulated that Burton's business records do not disclose what became of the claimants' funds.
11
Following Burton's disappearance, the Virginia State Bar Disciplinary Board conducted a hearing on charges of misconduct by Burton relating to Mrs. Thweatt and Mrs. Buckner. Burton did not appear to answer the charges, and there is no evidence that he personally received notice of the proceedings. The Disciplinary Board found that he had violated various rules of the Virginia Code of Professional Responsibility and revoked his license to practice law. Mrs. Buckner filed a claim with the Client Security Fund of the Virginia State Bar charging Burton with fraudulent or dishonest acts. Administrators of the fund have not yet decided her claim. Burton has also been indicted, but not on complaint of Mrs. Buckner or Mrs. Thweatt.
II
12
Continental contends that the losses suffered by Mrs. Buckner and Mrs. Thweatt were not caused by the performance of "professional services" within the meaning of Burton's insurance policy. The policy obligates the company:
13
To pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages:
14
1. arising from the performance of professional services for others in the insured's capacity as a lawyer, real estate title insurance agent or notary public ...
15
When the insured acts as an administrator, conservator, executor, guardian, trustee, receiver or in any other similar fiduciary activity, any act or omission committed by the insured in such capacity shall be deemed to have been committed during the performance of the insured's professional services....
16
Continental asserts that receiving funds from Mrs. Buckner and Mrs. Thweatt for investment "involved a separate and distinct transaction from any of the legal services [Burton] previously provided to them." These transactions, it argues, are not within the "practice of law" as that term is defined by the Supreme Court of Virginia and are not covered by Burton's policy.
17
The district court held that Burton acted as a fiduciary or trustee when he accepted Mrs. Buckner's and Mrs. Thweatt's funds for investment in the course of an attorney-client relationship. Accordingly, the court held that the policy afforded coverage.
18
We conclude that the district court's ruling with respect to coverage is supported by both the facts and the law. Burton acted as a lawyer for both claimants before and after they entrusted money to him. The funds were derived in part from legal proceedings in which he represented them. The policy did not limit coverage to Burton's activity in actual legal proceedings. It expressly included his services as a fiduciary.
19
The only expert witness, a lawyer with 27 years experience in the practice of law in Virginia testified that in his opinion Burton's conduct in investing his clients' funds was activity generally associated with the practice of law. He also expressed the opinion that Burton was acting in a fiduciary capacity similar to that of a trustee.
20
The Virginia Supreme Court does not appear to have addressed a similar factual situation. Virginia, however, adheres to the general rule that if an insurance policy "is susceptible of two constructions, one of which would effect coverage and the other would not, the court will adopt that construction which will afford coverage." Lincoln National Life Ins. Co. v. Commonwealth Corrugated Container Corp., 229 Va. 132, 137, 327 S.E.2d 98, 101 (1985). Application of this rule of construction to the facts of the case establishes coverage. It is commonplace that a person who is not a lawyer may invest another's money. But it does not follow that an attorney who undertakes such services is conclusively considered not to be acting in his capacity as an attorney.
21
For the purpose of determining coverage of a professional liability policy the test is whether the attorney was engaged for legal services by a client who subsequently entrusted him with money for investment.2 See Smith v. Travelers Indemnity Co., 343 F.Supp. 605, 609 (M.D.N.C.1972). In Smith a policy did not afford coverage to an attorney who solicited funds for investment from a person whom he did not represent in any legal proceeding. In contrast, a policy similar to Burton's covered the activity of an attorney who invested money from clients whom he had represented in a legal capacity. See Miles v. St. Paul Fire and Marine Ins. Co., 381 So.2d 13 (Ala.1980).
22
Continental's reliance on the Virginia Supreme Court's definition of the practice of law in its Rules of Court, 215 Va. 861 (1975), is misplaced.3 The rule does not limit the services which a lawyer may provide in his professional capacity; rather, it sets forth those services which only a lawyer, and not a layman, may provide. See Commonwealth v. Jones & Robins, Inc., 186 Va. 30, 36, 41 S.E.2d 720, 723-24 (1947).
III
23
Continental's policy excludes from coverage "any dishonest, fraudulent, criminal act or omission of the insured ..." Virginia law requires the insurance carrier to prove that the loss is excluded from the terms of the policy. See White v. State Farm Mutual Automobile Ins. Co., 208 Va. 394, 396, 157 S.E.2d 925, 927 (1967). Continental recognizes that it must prove fraud or criminal offenses by clear and convincing evidence, and that it must prove other dishonest acts or omissions by a preponderance of the evidence.
24
Continental properly points out that dishonesty, fraud, and criminality, whether practiced through acts or omissions, can be proved by circumstantial evidence.4 It asserts that the evidence establishes that Burton either pledged the claimants' funds as collateral for his debts, or embezzled or stole them. Burton's disappearance and his failure to repay the funds, it argues, prove at a minimum his dishonesty. In support, it cites Burton's indictment, the revocation of his license, the lack of records, Mrs. Buckner's allegations in civil proceedings, and her petition to the state bar security fund.
25
We conclude that Continental has not established the exclusion as a matter of law. The carrier's defense is factual. We must therefore examine the district court's findings to determine whether they are clearly erroneous.
26
Mrs. Buckner alleged fraud and dishonesty both in her civil action in state court and the petition to the Bar Security Fund. She testified that she did not believe Burton embezzled her money, that the pleadings were drafted by her lawyer, and she signed them at his request. The district court credited her testimony and accepted her explanation for her inconsistent positions. We find no grounds for setting aside the trial court's credibility finding. Mrs. Buckner is an elderly woman who had dealt satisfactorily with Burton over a period of many years.5
27
Apart from Mrs. Buckner's prior inconsistent statements, there is no significant dispute about the material facts. Burton had practiced law for a number of years. The record discloses no blemish on his reputation. Both claimants testified that they sought his representation for their legal affairs and that he had served satisfactorily. He was in the process of moving his office from Petersburg to Gwynn's Island, Virginia, and it was this that prompted the claimants to request their funds, rather than any dissatisfaction with him. At the trial, his wife produced his office files, but they shed no light on the claimants' investments. Whether the lack of records resulted from negligence or fraudulent, dishonest intent has not been shown. The court found that Burton had paid interest regularly. He had told the claimants he would combine their funds with other funds, including his own money, to get the best return on the investments that he could. They acquiesced in this commingling of funds. The court also found that the evidence did not prove that Mrs. Buckner's funds were used to purchase the certificate that Burton pledged for collateral. A promissory note stipulated that interest would be paid at the rate of a designated certificate, but Burton never represented to Mrs. Buckner that her money was invested in the certificate. The court found that the funds for this certificate could have come from other sources and that the source had not been identified.
28
Burton disappeared while on a business trip to Colorado. While there, he kept in touch with his wife by phone and told her when he expected to return. Continental has diligently, but unsuccessfully, sought Burton. The cause and manner of his disappearance are unknown.
29
A copy of the indictment against Burton was not introduced into evidence. Its existence was made known only because counsel for Mrs. Buckner believed that he would be remiss if he did not advise the court that he was aware that Burton had been indicted. He added that the indictment did not result from any complaint from Mrs. Buckner or Mrs. Thweatt. The crime charged in the indictment is not disclosed by this record. In any event, the indictment establishes probable cause to believe Burton was guilty of some crime. It does not satisfy Continental's burden of proving by clear and convincing evidence a criminal act with respect to the claimants' funds. Nor does it establish by a preponderance of the evidence that Burton dealt dishonestly with the claimants.
30
Continental's assertion of the policy's exclusion clause as a defense is undoubtedly the most difficult aspect of the case. Its resolution on appeal is governed by Federal Rule of Civil Procedure 52(a), which governs review of findings of fact,6 and by Virginia law, which places the burden of proof of an exclusion on the insurance carrier.7
31
In Anderson v. City of Bessemer, 470 U.S. 564, 105 S.Ct. 1504, 1512, 84 L.Ed.2d 518 (1985), the Court explained that "[w]here there are two permissible views of the evidence, the fact-finder's choice between them cannot be clearly erroneous." This rule prevails, the Court emphasized, even when the district court's findings are based on inferences drawn from the facts. 105 S.Ct. at 1512. Here a critical fact--the cause and manner of Burton's disappearance--is unknown. Under these circumstances, the case has to be resolved by drawing inferences from the known facts. The district court, unable to determine whether Burton's failure to repay the claimants was caused by dishonesty or embezzlement or by death or some other disabling misfortune, found that the evidence was insufficient to draw the inference that Burton was dishonest or that he had embezzled the claimants' funds. If the district court, like the Bar Disciplinary Board, had drawn a contrary inference, we cannot say that it would have been implausible. But as Anderson points out, this conclusion would not justify us in holding the district court's findings clearly erroneous if the inference the district court drew is plausible. See Anderson, 105 S.Ct. at 1513.
32
Anderson also reiterates that an appellate court may not reverse the trial court "simply because it is convinced that it would have decided the case differently." 105 S.Ct. at 1511. On the contrary, the appellate court can rule that the trial court's findings of fact are clearly erroneous only when although there is evidence to support the finding, "the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed." Anderson, 105 S.Ct. at 1511 (quoting United States v. United States Gypsum, 333 U.S. 364, 395, 68 S.Ct. 525, 542, 92 L.Ed. 746 (1948).
33
Under Virginia law speculation that Burton might have been dishonest is not enough. Continental's burden was to prove dishonesty by at least a preponderance of the evidence. Continental has also alleged that the claims involve fraudulent, criminal acts. These allegations require proof by clear and convincing evidence.
34
The district court's ultimate finding is that Continental has failed to prove that Mrs. Buckner's and Mrs. Thweatt's claims are excluded from the coverage afforded by the policy. The historical facts which the district court found are not clearly erroneous. Indeed the most important are undisputed. The inference the district court drew from these facts is plausible although a contrary inference could also be drawn. Accordingly, we conclude that the district court's ultimate finding of fact is not clearly erroneous.
IV
35
Continental's final contention is that Burton breached the policy's cooperation clause and relieved the company of liability with regard to the losses of Mrs. Buckner and Mrs. Thweatt. It argues that "[t]he facts of this case clearly establish Mr. Burton's non-cooperation. Mr. Burton did not appear at the trials of the underlying suits. In fact, Mr. Burton did not participate at all in the defense of the underlying suits." Continental points to Burton's disappearance after receiving demand for return of each woman's funds. It argues that the only reasonable inference to be drawn from this evidence is that Burton fled to avoid law suits which he knew would soon be brought against him.
36
In Virginia, rules for construing cooperation clauses in insurance contracts have developed in the context of actions on automobile liability policies. We agree with the district court that the rules developed in those cases apply to this case.
37
In order to establish that the insured has breached a cooperation clause by being unavailable, the insurer must prove that the insured willfully breached the clause in a material or essential particular and that the insurer made a reasonable effort to secure the insured's cooperation. See Cooper v. Employers Mutual Liability Ins. Co., 199 Va. 908, 914, 103 S.E.2d 210, 214 (1958); Grady v. State Farm Mutual Automobile Ins. Co., 264 F.2d 519 (4th Cir.1959). The existence of the insured's noncooperation with the insurer is ordinarily a question of fact on which the insurer has the burden of proof. Shipp v. Connecticut Indemnity Co., 194 Va. 249, 258, 72 S.E.2d 343, 348 (1952); Bryant v. Liberty Mutual Ins. Co., 407 F.2d 576, 577-78 (4th Cir.1969). The parties have stipulated to Continental's diligence in attempting to locate Burton.
38
The district court found that Continental had not carried the burden of proving willfulness on Burton's part. The court observed that there is no evidence that Burton ever was made aware that Mrs. Buckner and Mrs. Thweatt filed suits against him. The district court found that the inference that Burton's disappearance was willful noncooperation was no more compelling than the inference that it was caused by disablement or foul play. This is a permissible view of the evidence which we may not disturb. Anderson, 105 S.Ct. at 1512.
39
The cases on which Continental relies do not require a different result. In Cooper, 199 Va. 908, 103 S.E.2d 210, the insured had actual knowledge that he had a duty to cooperate with his insurance company. In Grady, 264 F.2d 519, the insured was notified by letter of his duty to cooperate. A subsequent letter from the insurer to the insured was returned marked "Unknown." Thereafter the insurer made diligent efforts to contact the insured but was unable to do so. In State Farm Mutual Automobile Ins. Co. v. Davies, 226 Va. 310, 310 S.E.2d 167 (1983), the parties stipulated to the noncooperation of the insured. None of these cases suggests that the disappearance of Burton requires a finding that he willfully failed to cooperate with Continental.
40
Finally, Continental argues that Burton was given notice of his duty to cooperate by means of the substituted service which Mrs. Buckner and Mrs. Thweatt used in the state proceedings. The district court properly rejected this argument. Under Virginia law, willful noncooperation requires a deliberate or intentional refusal to cooperate. See Cooper, 199 Va. at 913, 103 S.E.2d at 215; State Farm Mut. Automobile Ins. v. Arghyris, 189 Va. 913, 929, 55 S.E.2d 16, 23 (1949). Although constructive notice allowed the Virginia courts to obtain personal jurisdiction over Burton, it did not require the district court to find that he had actual knowledge of the suits. See Bridgewater Roller-Mills Co. v. Strough, 98 Va. 721, 728, 37 S.E. 290, 292 (1900) ("Proof of actual notice must be such as affects the conscience of the party sought to be charged with such notice ..."). Here there is no proof that Burton received actual notice. We conclude that the district court's finding that Continental failed to prove Burton's willful noncooperation is not clearly erroneous.
41
The judgment of the district court is affirmed.
1
Burton also sold stock in the gold mine to the claimants. The stock appears to be worthless but it is not a part of the claims against Continental
2
Ellenstein v. Herman Body Co., 23 N.J. 348, 129 A.2d 268, 270 (1957), states the test as follows:
"[T]he controlling circumstance is whether the attorney was in fact engaged for the purpose of obtaining his legal services. If he was so engaged, then the fact that in the course of the rendition of the services he stepped beyond the strictly legal role to undertake to render services which a non-lawyer could render, would not justify the conclusion that he was engaged other than as a lawyer...."
3
Pertinent extracts from the rule provide:
Specifically, the relation of attorney and client exists, and one is deemed to be practicing law, whenever--
(1) One undertakes for compensation, direct or indirect, to advise another, not his regular employer, in any matter involving the application of legal principles to facts or purposes or desires.
(2) One, other than as a regular employee acting for his employer, undertakes, with or without compensation, to prepare for another legal instruments ...
(3) One undertakes, with or without compensation, to represent the interest of another before any tribunal ...
4
Continental relies on a number of cases which hold that the trier of fact may find embezzlement on the basis of circumstantial evidence. See, e.g., Challenor v. Commonwealth, 209 Va. 789, 167 S.E.2d 116 (1969); Stegall v. Commonwealth, 208 Va. 719, 160 S.E.2d 566 (1968); United States v. Powell, 413 F.2d 1037 (4th Cir.1969). These cases are factually dissimilar from Burton's situation. In each, the defendant testified, and the trier of fact rejected his explanation
5
At the conclusion of Mrs. Buckner's testimony, the following colloquy took place:
The Court: I don't want to keep pushing on this thing, but I am at a loss to understand why you would tell the state bar--let me see if I can find the language--well you knew by filing this that you were telling the bar you had been cheated out of your money, didn't you know that?
A. Your honor, I did, yes.
The Court: Why did you say that if you are now telling me that you didn't accuse him of fraudulently taking your money.
A. To be perfectly honest with you, I think that I was so distraught at my personal losses and financial losses that I wasn't sure at that point, although I have always trusted him. But when all this happened so quickly, I just didn't--and if I had to--I mean, I have said all along that I don't believe Bill willfully and intentionally set about to--
The Court: Do you have any idea whether he really took your money or whether he is off somewhere suffering from amnesia?
A. I don't.
The Court: You don't have any idea?
A. I don't have any idea.
6
Rule 52(a) as amended in 1985 provides in part:
Findings of fact, whether based on oral or documentary evidence, shall not be set aside unless clearly erroneous, and due regard shall be given to the opportunity of the trial court to judge of the credibility of the witnesses.
7
See White v. State Farm Mutual Automobile Ins. Co., 208 Va. 394, 396, 157 S.E.2d 925, 927 (1967)
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Case: 12-10582 Document: 00512868387 Page: 1 Date Filed: 12/12/2014
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 12-10582 United States Court of Appeals
Fifth Circuit
FILED
UNITED STATES OF AMERICA, December 12, 2014
Lyle W. Cayce
Plaintiff – Appellee Clerk
v.
FRENCHITT SU-DELL COLLINS; ALLEN MURRAY ROBISON,
Defendants – Appellants
Appeals from the United States District Court
for the Northern District of Texas
Before STEWART, Chief Judge, and JONES and HIGGINSON, Circuit
Judges.
EDITH H. JONES, Circuit Judge:
Frenchitt Su-Dell Collins and Allen Murray Robison conspired together
and with others to defraud insurance companies of hundreds of thousands of
dollars. Appellants and their confederates filed false claims for automobile
accidents that had never happened, using postal boxes registered to assumed
names. Following their convictions by a jury, defendants appeal on various
grounds, the only novel one of which involves the “concurrent sentence
doctrine.” For the following reasons, we AFFIRM the convictions and Collins’s
sentence.
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No. 12-10582
I.
Frenchitt Collins branded himself as “Big Brother.” He and his
associates, including his half-brother Allen Robison, recruited people to file
automobile accident and injury insurance claims when in fact no accident had
occurred. They advertised on television and elsewhere, used heavy machinery
to damage recruits’ automobiles, and created sham chiropractic clinics to
“provide treatment.” The nerve center of the scheme was in Collins’s house,
where his wife and mistress, among others, provided administrative support.
Collins coached recruits through claims-adjustment meetings with insurers,
and sometimes even used their identities directly. Robison enlisted his
sometimes girlfriend Natasha Robinson to lease a post office box, instructing
her to authorize a fake clinic to access the box.
A grand jury indicted Collins on nine counts: conspiracy to commit mail
fraud and health care fraud, and aiding and abetting, in violation of 18 U.S.C.
§§ 1349 and 2 (Count One); three counts of mail fraud and aiding and abetting,
in violation of 18 U.S.C. §§ 1341 and 2 (Counts Two-Four); four counts of
aggravated identity theft and aiding and abetting, in violation of 18 U.S.C.
§§ 1028A and 2 (Counts Five-Eight); and conspiracy to tamper with witnesses,
in violation of 18 U.S.C. § 1512(k) (Count Nine). 1 Robison was charged in
Counts One, Two, and Nine only. Shortly thereafter, four defendants were
arrested. Collins was placed in pretrial detention and Robison was released
on conditions.
Taking advantage of his relative freedom, Robison attempted to induce
several witnesses to sign affidavits that the witnesses later testified were
riddled with falsehoods. Robison ignored the magistrate judge’s first warning
and his pretrial release was revoked. Federal investigators subpoenaed
1 The Government dismissed Counts Five and Eight before trial began.
2
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jailhouse calls between Collins and Robison in which the two appear to discuss
their efforts at obtaining favorable trial testimony, including from the
witnesses to whom Robison had already spoken.
After a five-day trial, the jury convicted Collins and Robison on all
counts. On November 7, 2012, the district court sentenced Collins to
180 months imprisonment and restitution of $700,715.04. The court sentenced
Robison to a total of 110 months imprisonment and restitution of $203,572.26.
A Special Assessment Fee of $100.00 was imposed on each defendant for each
count of conviction. Both Appellants timely appealed.
II.
We first address the convictions, taking them in the order in which they
appear in the indictment.
A. Conspiracy to Commit Health Care Fraud (Count One)
Collins argues that the evidence was insufficient to support his
conviction for conspiracy to commit health care fraud. 2 Because Collins
preserved his objection by moving for acquittal on all conspiracy counts, we
review the sufficiency challenge de novo. United States v. Grant, 683 F.3d 639,
642 (5th Cir. 2012). Appellate review, however, is “highly deferential to the
verdict.” United States v. Harris, 293 F.3d 863, 869 (5th Cir. 2002). This court
determines only “whether the evidence, in the light most favorable to the
government with all reasonable inferences and credibility choices made in
support of a conviction, allows a rational fact finder to find every element of
the offense beyond a reasonable doubt.” United States v. Asibor, 109 F.3d 1023,
1030 (5th Cir. 1997).
2On appeal, Robison’s counsel briefs this issue under Anders, showing no nonfrivolous
challenge can be made by Robison.
3
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1. Healthcare Benefit Program
Collins argues that the insurance companies he defrauded do not meet
the statutory definition of “health care benefit program.” The healthcare fraud
statute makes it illegal to “defraud any health care benefit program[.]”
18 U.S.C. §1347(a). That term is in turn defined as “any public or private plan
or contract, affecting commerce, under which any medical benefit, item or
service is provided to any individual, and includes any individual or entity who
is providing a medical benefit, item, or service for which payment may be made
under the plan or contract.” Id. § 24(b).
Collins contends that the defrauded insurance companies here “provided
automobile insurance,” which “by definition” are not health care benefit
programs. The Second Circuit, in United States v. Lucien, rejected as “without
merit” a similar argument concerning the New York State no-fault automobile
insurance program. 347 F.3d 45, 52 (2d Cir. 2003). Accord United States v.
Gelin, 712 F.3d 612, 617 (1st Cir. 2013) (applying § 1347 to an automobile
insurer). We have no reason to differ with sister circuits. To the extent
automobile insurers pay for medical treatment, they are health care benefit
programs under the statute. The fraudulent claims here included, among
others, claims for medical treatment at a chiropractor, and the insurance
companies paid those claims.
2. Evidence of Agreement
Collins next argues that there was insufficient proof of an agreement to
sustain his conviction for conspiracy to commit fraud. He states that “all of the
insurance company witnesses called by the government to testify against
Collins did not testify that there was any connection or nexus with him.” He
faults the Government’s “two-year ‘cradle-to-the-grave’ investigation” for not
producing “audio recordings, text messages, e-mails, video surveillance, or
financial records” – evidence that he claims is “the norm” in these sorts of cases.
4
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Collins also asserts that unindicted coconspirators did not share proceeds.
While these types of evidence could support a conviction for conspiracy, their
absence does not imply there was no agreement. Other types of evidence can
support, and here do support, the verdict.
The Government points to the testimony of three witnesses: Andrina
Anthony, Demetrias Spence, and Savoy Terral. Anthony testified that Robison
introduced Collins to her as the leader of the scheme and that Collins gave her
instructions on what to say to her insurance company. Collins even attended
the meeting at the insurance company and intervened to explain why Anthony
appeared nervous. The Government produced a picture of the two together at
the insurance company’s office. A friend introduced Spence to Collins as “Big
Brother” when Spence complained about continual maintenance costs on her
vehicle. Collins told Spence he had done this “time and time again” and that
the job “should be easy.” Collins took Spence’s vehicle and returned it wrecked
in such a way that, according to Spence, “[i]t didn’t look like it was a regular
accident.” Collins then filed Spence’s insurance claim and coached her in
answering the questions. Terral testified that Collins told her he wrecked
another car with a machine that he owned. Collins then asked Terral to start
going to a chiropractor, even though she had not been involved in the accident
with the vehicle related to the claims (no one was – there was no accident).
Collins actually hired Terral to assist him with the medical billing portion of
his scheme, which was run out of his bedroom.
The district court instructed the jurors that they must find an agreement
in order to convict the defendants of conspiracy. The testimony of these three
witnesses, along with much other evidence of record, is more than enough for
a rational juror to find the existence of an illegal agreement.
5
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B. Mail Fraud (Counts Two-Four)
Both Appellants urge us to vacate their Count Two mail fraud
convictions either under the concurrent sentence doctrine or on the merits.
Under the Guidelines, each Appellant’s sentence on Count One (conspiracy)
runs concurrently with the Count Two sentence.
1. Concurrent Sentence Doctrine
Courts have used the concurrent sentence doctrine to avoid reviewing a
conviction whose sentence is set to run concurrently with the sentence of a
valid conviction. In the Fifth Circuit, this was accomplished in years past by
vacating the unreviewed conviction (while the valid conviction remains
untouched). United States v. Stovall, 825 F.2d 817, 824 (5th Cir. 1987).
As its name implies, the concurrent sentence doctrine requires that
sentences be “concurrent.” The sentences here, however, are not perfectly
concurrent because the district court imposed a $100 special assessment on the
Appellants as to each of the counts. 3 According to Ray v. United States,
however, when a defendant’s “liability to pay . . . depends on the validity of
each . . . conviction[], the sentences are not concurrent.” 481 U.S. 736, 737,
107 S. Ct. 2093, 2094 (1987) (per curiam). As a result of Ray, defendants hardly
ever invoke the concurrent sentence doctrine anymore.
To avoid this problem, Appellants suggest that this court has discretion
to vacate the special assessments to create complete concurrence. They cite
Stovall, where this court invoked the concurrent sentence doctrine when the
trial court had neglected to impose the special assessments required by law.
3 In addition to the special assessments, the district court ordered restitution in
different amounts for each Appellant, and did not specify to which counts the restitution
related. The Government argues that this defeats concurrence. However, when faced only
with undifferentiated restitution, this court ordered “remand to the district court for entry of
another restitution order based only on the convictions that have been affirmed or not
challenged on appeal.” Stovall, 825 F.2d at 824 n. 7.
6
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United States v. Stovall, 825 F.2d 817, 824 (5th Cir. 1987) amended by later
opinion, 833 F.2d 526 (5th Cir. 1987). 4
This argument fails. It should be obvious that declining to affirmatively
correct an irregularity below (whether the omission was deliberate or an
oversight) is not the same as creating that irregularity on appeal. Importantly,
in Stovall, we acknowledged the mandatory nature of the assessments but
noted that “the [district] court did not assess the $50 fee, and the government
raised no objection to this failure in the district court or on this appeal.” Id.
In this case, by contrast, the district court did impose the special assessments
and Appellants allege no impropriety in its doing so. Stovall actually stands
for the proposition that the presence of a special assessment on appeal defeats
the concurrent sentence doctrine.
The Government also points to the difficulty that could arise regarding
Collins’s conviction on Count Six, aggravated identity theft, if Count Two, the
facts of which underlie the Count Six conviction, is vacated. Nothing in the
concurrent sentence doctrine supports undermining unrelated counts of
conviction.
2. Evidentiary Sufficiency
Because neither Appellant properly objected, 5 we review only for plain
error their challenges to the evidence supporting the mail fraud convictions.
United States v. Barton, 257 F.3d 433, 439 (5th Cir. 2001). A conviction can be
reversed under the plain error standard for evidentiary insufficiency “only to
4 After Stovall was decided, it came to the court’s attention that Congress had passed
the statute imposing special assessments after the defendants there committed their crimes.
Accordingly, that portion of the opinion was revoked and it is not controlling authority.
5Collins argues that he moved for dismissal of all counts of conspiracy and thereby
preserved the right to de novo review. Count Two, however, is a separate charge of mail
fraud and aiding and abetting, not conspiracy. Robison admits that he has forfeited de novo
review.
7
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No. 12-10582
avoid a manifest miscarriage of justice.” United States v. Parker, 133 F.3d 322,
328 (5th Cir. 1998) (citing United States v. McCarty, 36 F.3d 1349, 1358
(5th Cir. 1994)). “‘Such a miscarriage would exist only if the record is devoid
of evidence pointing to guilt, or . . . because the evidence on a key element of
the offense was so tenuous that a conviction would be shocking.’” Id. (quoting
United States v. Pierre, 958 F.2d 1304, 1310 (5th Cir. 1992) (en banc)); see also
United States v. Delgado, 672 F.3d 320, 329 (5th Cir. 2012) (en banc).
Both Appellants argue that they took no affirmative steps to procure a
settlement check for an automobile accident that allegedly occurred in May
2008. The jury convicted both defendants of mail fraud as well as aiding and
abetting, but their briefs primarily focus on the latter aspect of Count Two. To
convict for mail fraud by aiding and abetting, the Government must prove that
(1) the offense of mail fraud was committed by someone, (2) the defendant
associated with the criminal venture, (3) the defendant purposefully
participated in the criminal venture, and (4) the defendant took affirmative
steps to make the venture successful. United States v. Carreon-Palacio,
267 F.3d 381, 389 (5th Cir. 2001).
The evidence of Count Two mail fraud here was overwhelming. Several
people associated with Collins’s organization filed insurance claims based on
this non-existent auto accident, and one claim was paid to “Advanced Chiro
Care,” a non-existent chiropractic clinic whose post office box had been set up
by Robison’s girlfriend Natasha Robinson at Robison’s direction. Natasha gave
Robison the key to the post office box. Collins’s leadership of the claims-filing
fraud ring was well established. Robison contends he was jailed in Oklahoma
at the time these fraudulent claims were made. Neither that fact, however,
nor the fact that the specific check never made it to the post office box (it was
sent to the alleged street address of Advanced Chiro Care instead) absolves
Robison of his affirmative role in furthering the success of the criminal
8
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enterprise. Robison was at least an aider and abettor of the crime; hence, there
is no plain error in his conviction.
3. McCarran-Ferguson Reverse Preemption
Collins argues that the McCarran-Ferguson Act, 15 U.S.C. §§ 1011 et
seq., suspends the operation of federal mail fraud statutes in this case.
Congress passed the Act “to restore the supremacy of the States in the realm
of insurance regulation.” U.S. Dep’t of Treas. v. Fabe, 508 U.S. 491, 500,
113 S. Ct. 2202, 2207 (1993). The Act mandates that no federal law “shall be
construed to invalidate, impair, or supersede any law enacted by any State for
the purpose of regulating the business of insurance” unless it “specifically
relates to the business of insurance[.]” 15 U.S.C. § 1012 (emphasis added).
However, “when application of the federal law would not frustrate any declared
state policy or interfere with a State's administrative regime, the McCarran-
Ferguson Act does not preclude its application.” Humana Inc. v. Forsyth,
525 U.S. 299, 310, 119 S. Ct. 710, 717 (1999). Thus, the usual “reverse-
preemption” analysis is in two steps: is the federal law specifically related to
insurance, and if not, does it conflict, invalidate, impair, or supersede some
state insurance law?
The first part of the test is not at issue – the fraud statutes here are not
specifically addressed to the business of insurance. Resolving the reverse-
preemption question, then, turns on whether the mail fraud statute
“invalidates, impairs, or supersedes” Texas insurance laws. See Tex. Ins. Code
§ 541.003 (broadly prohibiting “unfair method[s] of competition” and “unfair or
deceptive act[s]”). Collins, however, does not and cannot identify any conflict.
First, the mail fraud statute runs in the same direction as § 541.003 of the
Insurance Code. To the extent they apply to the same behavior, both laws
condemn dishonesty. Second, the Insurance Code provides civil remedies to
consumers, and the mail fraud statute is a criminal law. The two laws only
9
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No. 12-10582
come in contact with one another when a person, like Collins, commits unfair
or deceptive trade practices in the insurance business by, among other things,
breaking federal mail fraud laws. The McCarran-Ferguson Act does not
preclude concurrent operation of the federal mail fraud statute. 6
C. Conspiracy to Tamper with Witnesses (Count Nine)
Both Appellants moved for acquittal on their Count Nine convictions at
the appropriate times during the trial, thus preserving their rights to de novo
review, though all reasonable inferences are drawn in favor of the verdict.
United States v. Curtis, 635 F.3d 704, 717 (5th Cir. 2011).
The jury found Appellants guilty of conspiracy in violation of 18 U.S.C.
§ 1512(k), which criminalizes a conspiracy to “knowingly . . . corruptly
persuade[] another person . . . or engage[] in misleading conduct toward
another person, with intent to [] influence, delay, or prevent [his] testimony.”
Appellants argue that only two witnesses testified concerning the
conspiracy to corruptly persuade witnesses, and that the Government proved
only that Appellants had shown the witnesses affidavits that the witnesses
refused to sign. This characterization is generous at best. One of these
witnesses testified at trial about the very fact that she had refused to testify
for defendants because the draft affidavit “was a bunch of lies on it.” This same
witness testified virtually line-by-line to the falsehoods in the draft affidavit.
The Government also introduced evidence of jailhouse calls between
Appellants that support the jury verdict. They discuss getting people to sign
6 In summarizing his first point of error, Collins claims that his “convictions lack
evidentiary support and were tainted by the Government’s inadvertent and improper
Brady . . . violations.” His brief lacks any argument on this point or on a reference to the
identity theft conviction (Counts Six and Seven). See Fed. R. App. P. 28(a)(8)(A). In this
circuit, “[a] party that asserts an argument on appeal, but fails to adequately brief it, is
deemed to have waived it.” United States v. Scroggins, 599 F.3d 433, 446 (5th Cir. 2010)
(quoting Knatt v. Hosp. Serv. Dist. No. 1, 327 F. App’x 472, 483 (5th Cir. 2009) (unpublished)).
10
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No. 12-10582
“applications” and “contracts” and lapse into what appears to be some attempt
at code whenever the subject arises. These calls together with witness
testimony amply support a finding that Collins and Robison conspired to
induce witnesses to provide false sworn testimony.
Appellants’ First Amendment challenge to this conviction is misplaced.
The Supreme Court has exhibited “restraint… where the act underlying the
conviction – ‘persua[sion]’ – is by itself innocuous.” Arthur Andersen LLP v.
United States, 544 U.S. 696, 703, 125 S. Ct. 2129, 2134 (2005) (alteration in
original). Indeed, a litigant even has a right to persuade a witness to withhold
documents or his testimony in certain circumstances. Id. at 704, 125 S. Ct. at
2135 (when communications are privileged, for example). Appellants argue
that Count Nine alleged only that they provided witnesses with an affidavit to
sign, and that each witness examined the affidavit and refused. This conduct,
they appear to argue, cannot pass constitutional muster for illegal “knowingly
corruptly persuading.” However, the district court properly instructed the jury
on the elements of conspiracy and corrupt persuasion, including the requisite
mens rea for the latter. There is no indication that the jury convicted these
defendants for anything other than constitutionally unprotected behavior. 7
III.
Appellant Collins challenges the district court’s calculation of his
sentence on five grounds: miscalculating the amount of loss; miscalculating the
number of victims for the mass-marketing enhancement; finding that he led or
organized a criminal activity that involved five or more participants or was
7 Collins also argues that there was a material variance between Count Nine in the
indictment and the evidence presented at trial. This argument has no merit. Consistent
with the indictment, the Government introduced evidence at trial of a recorded call between
Collins and his wife on October 20, 2011; regardless, there was no unfair surprise or prejudice
because Collins had received this recording in discovery.
11
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No. 12-10582
otherwise extensive; 8 applying the sophisticated means enhancement; and
enhancing his sentence for obstruction of justice. Collins preserved all of these
claims by objecting during the sentencing hearing. Appellate courts review
sentences for reasonableness under the standard set forth in United States v.
Booker, 543 U.S. 220, 125 S. Ct. 738 (2005). The rule in this circuit is that “a
sentence within a properly calculated Guideline range is presumptively
reasonable.” United States v. Alonzo, 435 F.3d 551, 554 (5th Cir. 2006),
approved by Rita v. United States, 551 U.S. 338, 346-47, 127 S. Ct. 2456, 2462
(2007).
A. Loss Amount
Collins makes several arguments in challenging the district court’s
calculation of the loss his schemes inflicted. “The calculation of the amount of
loss is a factual finding, reviewed for clear error.” United States v. Tedder,
81 F.3d 549, 550 (5th Cir. 1996); see also United States v. Setser, 568 F.3d 482,
496 (5th Cir. 2009). However, the appeals court reviews “de novo how the
[district] court calculated the loss, because that is an application of the
guidelines, which is a question of law.” United States v. Klein, 543 F.3d 206,
214 (5th Cir. 2008) (citing United States v. Saacks, 131 F.3d 540, 542-43 (5th
Cir. 1997)).
First, Collins challenges the method on which the district court relied to
calculate the actual and intended loss Collins inflicted. The district court
sentenced Collins on the basis of 58 total claims, 47 of which were successful.
8 Because the record is replete with evidence that Collins’s scheme utilized more than
five participants, his objection to the § 3B1.1(a) four-level enhancement is frivolous.
12
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For the failed claims, the PSR averaged the claims that were actually paid out.
Contrary to Collins’s view, this was a reasonable methodology.
Collins objects that the district court relied on hearsay. However, “[i]n
resolving any dispute concerning a factor important to the sentencing
determination, the court may consider relevant information without regard to
its admissibility under the rules of evidence applicable at trial[.]” U.S.S.G.
§ 6A1.3(a). And “for sentencing purposes, even ‘uncorroborated hearsay
evidence’ is sufficiently reliable.” United States v. West, 58 F.3d 133, 138 (5th
Cir. 1995) (quoting United States v. Golden, 17 F.3d 735, 736 (5th Cir. 1994)).
Collins further contends it was inappropriate to consider the
unsuccessful claims at all. The Sentencing Guidelines advise courts to consider
“all acts and omissions committed, aided, abetted, counseled, commanded,
induced, procured, or willfully caused by the defendant.” U.S.S.G.
§ 1B1.3(a)(1)(A); accord United States v. Levario-Quiroz, 161 F.3d 903, 906 (5th
Cir. 1998) (“Courts are to consider more than the offense of conviction itself in
fitting the sentence to the crime and the criminal.”). Collins cites
Apprendi/Alleyne for the proposition that any fact that increases a penalty
“must be submitted to the jury and found beyond a reasonable doubt.” Alleyne
v. United States, 133 S. Ct. 2151, 2155 (2013). The Government counters,
correctly, that these cases require proof beyond a reasonable doubt of a fact
that increases the statutory minimum or maximum sentence. They do not apply
to Guidelines calculations that, as in this case, fall within the statutory range.
See United States v. Sanchez, 269 F.3d 1250, 1262 (11th Cir. 2001) (Apprendi’s
“inapplicability to the Sentencing Guidelines follows from its holding.”). We
have rejected an interpretation of the Guidelines that would forbid courts from
considering “conduct related to dismissed counts or uncharged conduct.”
United States v. Thomas, 932 F.2d 1085, 1088 (5th Cir. 1991). The existence
13
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of unsuccessful claims (or unprosecuted claims) is thus relevant to sentencing
calculations.
Finally, even if the 11 unsuccessful claims are deleted from sentencing,
the total loss amount is in the same Guidelines range as the figure that the
district court used. Any error is harmless.
B. Mass-marketing or Number of Victims
The district court enhanced Collins’s sentence under U.S.S.G.
§ 2B1.1(b)(2)(A)(i) and (ii) because the scheme “involved 10 or more victims…
or [] was committed through mass marketing.” Collins argues that the jury
considered claims submitted to only eight victims and no testimony shows that
he recruited through his television commercial, which he implicitly concedes
constitutes a “mass marketing.” The use of mass marketing alone satisfies this
enhancement.
C. Sophisticated Means
The district court applied a two-level enhancement because the offense
“otherwise involved sophisticated means.” U.S.S.G. § 2B1.1(b)(10)(C).
Notwithstanding Collins’s description of his fraud as a “garden variety health
care fraud scheme,” his scheme involved the use of multiple post office boxes
opened by several different individuals, fictitious chiropractic clinics, for which
assumed name certificates were obtained, pre-paid cell phones used to respond
to claim inquiries, fake medical records, and fake entities and addresses. The
Application Notes to the Guideline give as examples of sophisticated means
“hiding assets or transactions” . . . “the use of fictitious entities [or] corporate
shells[.]” U.S.S.G. § 2B1.1, cmt. 9.(B). The scheme for which the jury convicted
Collins falls squarely within the sophisticated means enhancement.
D. Obstruction of Justice/Double Counting
The district court found that Collins’s sentence was subject to a two-level
enhancement for obstructing justice. Collins complains that this twice puts
14
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No. 12-10582
him in jeopardy, because the Count Nine witness tampering conviction is based
on the same underlying conduct. To the contrary, the two-level enhancement
falls within the express terms of Application Note 8 to U.S.S.G. § 3C1.1,
because the witness tampering count had already been grouped for sentencing
with Collins’s conspiracy and mail fraud counts. This amounted to one
sentence enhancement for witness tampering, not a double-counting at all. 9
CONCLUSION
The evidence is sufficient to uphold both Appellants’ convictions on all
counts and the myriad legal challenges fail. The judgments of conviction and
Collins’s sentence are AFFIRMED.
9Collins’s objection that the trial court did not comply with Fed. R. Crim. Proc. 32 in
evaluating his objections to the PSR is meritless.
15
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669 F.Supp.2d 836 (2009)
AUTOMOTIVE TECHNOLOGIES INTERNATIONAL, INC., Plaintiff,
v.
SIEMENS VDO AUTOMOTIVE CORP., et al., Defendants.
Case No. 06-CV-15756-DT.
United States District Court, E.D. Michigan, Southern Division.
October 30, 2009.
*839 Andrew Kochanowski, Lisa R. Mikalonis, Sommers, Schwartz PC, Southfield, MI, Michael H. Baniak, McDonnell, Boehnen, Chicago, IL, for Plaintiff.
Boyd T. Cloern, Bingham McCutchen LLP, Jin-Suk Park, Akin, Gump, Washington, DC, Drew M. Wintringham, III, Mark W. Rueh, DLA Piper US LLP, Mark A. Kirsch, Clifford Chance, New York, NY, Kathleen A. Lang, Michelle Thurber Czapski, Dickinson Wright, Detroit, MI, Andrea L. Moody, Lawrence C. Mann, Bowman & Brooke, Troy, MI, Gregory A. Lewis, Peter J. Brennan, Reginald J. Hill, Jenner and Block, Chicago, IL, for Defendants.
OPINION AND ORDER GRANTING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT OF INVALIDITY [DKT. # 113], GRANTING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT OF INVALIDITY [DKT. 115], AND DENYING AS MOOT DEFENDANTS' MOTIONS FOR SUMMARY JUDGMENT [DKT. ## 108, 109, 110, 111, 112, 116, 119, 120]
ROBERT H. CLELAND, District Judge.
Pending before the court are ten motions for summary judgment filed by the Defendants in this case. The parties have briefed the matter, and the court concludes a hearing on the motion is unnecessary. See E.D. Mich. LR 7.1(e)(2). For the reasons stated below, the court will grant Defendants' motion for summary judgment of invalidity as to U.S. Patent Nos. 7,025,379, 7,052,038, and 7,070,202, grant Defendants' motion for summary judgment of invalidity as to U.S. Patent No. 6,850,824, and deny the remaining motions as moot.
I. INTRODUCTION[1]
This litigation involves U.S. Patent Nos. 7,025,379 ("'379 Patent"), 7,052,038 ("'038 Patent"), 7,070,202 ("'202 Patent"), 7,097,201 ("'201 Patent") and 6,850,824 ("'824 Patent"), all of which are related to motor vehicle side-impact sensors that deploy occupant protection apparatus, such as airbags. ATI earlier litigated Patent No. *840 5,231,253 ("'253 Patent") before this court, and the court construed that patent to disclose both a mechanical accelerometer and an electronic-based side crash sensor. The court also concluded that certain defendants should be dismissed because of the locations in vehicles where sensors were mounted. Auto. Techs. Int'l, Inc. v. BMW of N. Am., Inc., No. 01-71700, 2004 WL 5465964 (E.D.Mich. March 31, 2004) (Cleland, J.). The court later granted summary judgment to the remaining defendants because any claims concerning electronic sensors were invalid for lack of enablement. Auto. Techs. Int'l, Inc. v. BMW of N. Am., Inc. (ATI I), 378 F.Supp.2d 780 (E.D.Mich.2005). The Court of Appeals for the Federal Circuit affirmed, finding the '253 patent invalid for lack of enablement. Automotive Technologies Int'l, Inc. v. BMW of North America, Inc., 501 F.3d 1274 (Fed.Cir. 2007).[2]
ATI contends that the patents involved in this litigation "generally come from two different `families' of earlier ATI patents which followed the '253 Patent, and which add detail to the specification concerning use of an electronic side crash sensor in connection with occupant restraint apparatus." (ATI's Br. at 1.) Defendants dispute this view and contend that ATI is "attempt[ing] to justify the overly broad claim scope it now seeks." (Defs.' Br. at 1-2.) The court construed the parties' claims in its November 11, 2008 order, and following that order the parties agreed to dismissal of Plaintiff's claims as to the '201 patent, and the court entered a stipulated order to this effect on February 3, 2009.
II. STANDARD
Under Federal Rule of Civil Procedure 56, summary judgment is proper when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R.Civ.P. 56(c). "In deciding a motion for summary judgment, the court must view the evidence in the light most favorable to the non-moving party, drawing all reasonable inferences in that party's favor." Sagan v. United States, 342 F.3d 493, 497 (6th Cir.2003). "Where the moving party has carried its burden of showing that the pleadings, depositions, answers to interrogatories, admissions and affidavits in the record, construed favorably to the non-moving party, do not raise a genuine issue of material fact for trial, entry of summary judgment is appropriate." Gutierrez v. Lynch, 826 F.2d 1534, 1536 (6th Cir.1987) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)).
The court does not weigh the evidence to determine the truth of the matter, but rather, to determine if the evidence produced creates a genuine issue for trial. Sagan, 342 F.3d at 497 (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). The moving party must first show the absence of a genuine issue of material fact. Plant v. Morton Int'l, 212 F.3d 929, 934 (6th Cir.2000) (citing Celotex, 477 U.S. at 323, 106 S.Ct. 2548). The burden then shifts to the nonmoving party, who "must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). They must put forth enough evidence to show that there exists a genuine issue to be decided at trial. Plant, 212 F.3d at 934 (citing Anderson, 477 U.S. at 256, 106 S.Ct. 2505).
The existence of a factual dispute alone does not, however, defeat a properly supported *841 motion for summary judgmentthe disputed factual issue must be material. See Anderson, 477 U.S. at 252, 106 S.Ct. 2505 (citation omitted) ("The judge's inquiry, therefore, unavoidably asks whether reasonable jurors could find by a preponderance of the evidence that the plaintiff is entitled to a verdict`whether there is [evidence] upon which a jury can properly proceed to find a verdict for the party producing it, upon whom the onus of proof is imposed.'"). A fact is "material" for purposes of summary judgment when proof of that fact would establish or refute an essential element of the claim or a defense advanced by either party. Kendall v. Hoover Co., 751 F.2d 171, 174 (6th Cir.1984) (citation omitted).
A patent enjoys a presumption of validity pursuant to 35 U.S.C. § 282. "Consequently, `a moving party seeking to invalidate a patent at summary judgment must submit such clear and convincing evidence of invalidity so that no reasonable jury could find otherwise.'" Chrimar Sys. v. Cisco Sys., 318 F.Supp.2d 476, 491 (E.D.Mich.2004) (quoting Eli Lilly & Co. v. Barr Labs., 251 F.3d 955, 962 (Fed.Cir. 2001)); see also Beckson Marine, Inc. v. NFM, Inc., 292 F.3d 718, 725 (Fed.Cir. 2002) (holding that a party seeking to establish particular claims as invalid must overcome the presumption of validity in 35 U.S.C. § 282 by clear and convincing evidence). However, "[t]he burden of persuasion created by the presumption of validity of the patent as issued is more easily met when evidence is introduced of more pertinent prior art than that considered by the Patent Examiner during prosecution of the patent application." Standard Mfg. v. United States, 25 Cl.Ct. 1, 50 (Cl.Ct.1991) (citing Solder Removal Co. v. United States Int'l Trade Com., 65 C.C.P.A. 120, 582 F.2d 628, 633 (1978)).
Finally, "[a] quite different burden is that of going forward with evidence-sometimes referred to as the burden of production-a shifting burden the allocation of which depends on where in the process of trial the issue arises." Tech. Licensing Corp. v. Videotek, 545 F.3d 1316, 1327 (Fed.Cir.2008) (citation omitted). First the party alleging invalidity has the burden of going forward with evidence of anticipating prior art, and then the patent-holder has the burden of going forward with evidence
that it is not prior art because the asserted claim is entitled to the benefit of a filing date prior to the alleged prior art. This requires [a party] to show not only the existence of the earlier application, but why the written description in the earlier application supports the claim.
Id. (internal citations omitted). This means "producing sufficient evidence and argument to show that an ancestor to the [patent at issue], with a filing date prior to the [alleged prior art] date, contains a written description that supports all the limitations of . . . the claim being asserted." Id.
In order to establish invalidity on obviousness grounds, Defendants must show that "the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains." 35 U.S.C. § 103(a).
Obviousness under 35 U.S.C. § 103(a) is ultimately a legal question, based on underlying factual determinations. See Richardson-Vicks, Inc. v. Upjohn Co., 122 F.3d 1476, 1479 (Fed.Cir.1997). The factual determinations underpinning the legal conclusion of obviousness include 1) the scope and content of the prior art, *842 2) the level of ordinary skill in the art,[3] 3) the differences between the claimed invention and the prior art, and 4) evidence of secondary factors, also known as objective indicia of non-obviousness. Graham v. John Deere Co., 383 U.S. 1, 17-18, 86 S.Ct. 684, 15 L.Ed.2d 545 (1966).
Eisai Co. Ltd. v. Dr. Reddy's Labs., Ltd., 533 F.3d 1353, 1356 (Fed.Cir.2008); see also Para-Ordnance Mfg., Inc. v. SGS Imps. Int'l., Inc., 73 F.3d 1085, 1088 (Fed. Cir.1995) ("The ultimate determination of obviousness is a question of law, which we review de novo."). "The scope and content of the prior art, differences between the prior art and the claimed invention, the level of ordinary skill in the art, and objective evidence of secondary considerations of patentability are fact determinations." Para-Ordnance Mfg., 73 F.3d at 1088. Additionally, "[w]hat the prior art teaches and whether it teaches toward or away from the claimed invention also is a determination of fact." Id.
It is the movant's burden to prove invalidity by clear and convincing evidence. Id. (citing Monarch Knitting Mach. Corp. v. Sulzer Morat GmbH, 139 F.3d 877, 881 (Fed.Cir.1998)). As "[t]he Supreme Court stated in Anderson, . . . `in ruling on a motion for summary judgment, the judge must view the evidence presented through the prism of the substantive evidentiary burden.'" Enzo Biochem, Inc. v. Gen-Probe Inc., 424 F.3d 1276, 1284 (Fed.Cir. 2005) (quoting Anderson, 477 U.S. at 254, 106 S.Ct. 2505).
"The grant of summary judgment of invalidity for obviousness must be done on a claim by claim basis." Knoll Pharm. Co., Inc. v. Teva Pharms. USA, Inc., 367 F.3d 1381, 1384 (Fed.Cir.2004) (citing Dayco Prods., Inc. v. Total Containment, Inc., 329 F.3d 1358, 1371 (Fed. Cir.2003)). "The accused infringer must prove by clear and convincing evidence that each claim that is challenged cannot reasonably be held to be non-obvious." Id. (citing Monarch Knitting Mach. Corp., 139 F.3d at 881). Clear and convincing evidence exists when the movant "place[s] in the mind of the ultimate fact finder an abiding conviction that the truth of its factual contentions are `highly probable.'" Colorado v. New Mexico, 467 U.S. 310, 316, 104 S.Ct. 2433, 81 L.Ed.2d 247 (1984).
The Supreme Court has recently clarified the law with respect to obviousness in KSR Int'l. Co. v. Teleflex Inc., 550 U.S. 398, 127 S.Ct. 1727, 167 L.Ed.2d 705 (2007). In KSR, the Supreme Court rejected a rigid application of the "teaching, suggestion, or motivation" ("TSM") test. KSR, 550 U.S. at 418-19, 127 S.Ct. 1727. The Court explained: "The obviousness analysis cannot be confined by a formalistic conception of the words teaching, suggestion, and motivation, or by overemphasis on the importance of published articles and the explicit content of issued patents." Id. The Federal Circuit has since elaborated:
a rigid requirement of reliance on written prior art or patent references would, as the Supreme Court noted, unduly confine the use of the knowledge and creativity within the grasp of an ordinarily skilled artisan. [KSR, 127 S.Ct.] at 1742. As this court has explained, however, a flexible TSM test remains the primary guarantor against a non-statutory hindsight analysis such as occurred in this case. In re Translogic Tech., Inc., 504 F.3d 1249, 1257 (Fed. *843 Cir.2007) ("[A]s the Supreme Court suggests, a flexible approach to the TSM test prevents hindsight and focuses on evidence before the time of invention."). The TSM test, flexibly applied, merely assures that the obviousness test proceeds on the basis of evidenceteachings, suggestions (a tellingly broad term), or motivations (an equally broad term)that arise before the time of invention as the statute requires. As KSR requires, those teachings, suggestions, or motivations need not always be written references but may be found within the knowledge and creativity of ordinarily skilled artisans.
Ortho-McNeil Pharm., Inc. v. Mylan Labs., Inc., 520 F.3d 1358, 1364-65 (Fed. Cir.2008).
III. DISCUSSION
A. Invalidity Contentions
1. Invalidity of the '379, '038, and '202 Patents Based on the '974 Mazur Patent
In their motion for summary judgment on the invalidity of the '379, '038, and '202 Patents, Defendants Hyundai, Kia, Nissan, TRW, and TK argue that Plaintiff's claims as to these patents are invalid as anticipated and obvious by prior art, namely by U.S. Patent No. 5,566,974 ("'974 Mazur Patent"), in addition to several others. Defendants further argue that the '974 Mazur Patent has an effective filing date of March 22, 1993, which predates the earliest effective filing date of the asserted patents, which have an effective filing date of September 16, 1993, and that the '974 Mazur Patent was undisclosed to the Patent Office at the time of filing. Defendants assert that the '974 Mazur Patent is therefore prior art under § 102(e) and renders Plaintiff's '379, '038, and '202 Patents invalid.
In response, Plaintiff contends that it can "swear behind" the patent, that is, show prior conception for the three patents, such that the '974 Mazur Patent does not render Plaintiff's claims invalid. In the alternative, Plaintiff argues that the three patents are entitled to an effective filing date of July 9, 1991, which renders the '974 Mazur Patent irrelevant as prior art. Plaintiff further argues that it has petitioned the Patent Office for a reissue of the patents based on a priority date of July 1991 because the '038 Patent should have been filed as a continuation-in-part of the '970 Patent. Finally, Plaintiff argues that the '974 Mazur Patent does not anticipate the '038 Patent because it does not show as a transfer structure, as Plaintiff's patent does.
a. Prior Art
Section 102 of Title 35 provides that a "person shall be entitled to a patent" unless:
(e) the invention was described in (1) an application for patent, published under section 122(b), by another filing in the United States before the invention by the applicant for patent or (2) a patent granted on an application for patent by another filing in the United States before the invention by the applicant for patent, except that an international application filed under the treaty defined in section 351(a) shall have the effects for the purposes of this subsection of an application filed in the United States only if the international application designated the United States and was published under Article 21(2) of such treaty in the English language.
35 U.S.C. § 102. Nonetheless, a plaintiff whose patent is allegedly barred by § 102(e) "can overcome a reference by showing that [it was] in possession of [its] invention prior to the effective date of the reference." In re Costello, 717 F.2d 1346, 1349 (Fed.Cir.1983).
*844 While courts are not always precise regarding the specific statute or legal authority, an inventor can "swear behind" alleged anticipatory prior art to show prior "invention" for the purposes of defeating a claim for invalidity on the basis of § 102(e).[4] To do so, the inventor must usually show (1) constructive reduction to practice, even though the inventor need not show actual reduction to practice, or (2) conception and diligence in filing a patent application following the date of conception. See Polaroid Corp. v. Eastman Kodak Co., 641 F.Supp. 828, 228 U.S.P.Q. 305, 331 (D.Mass.1985), aff'd, 789 F.2d 1556 (Fed.Cir.1986).
The law is clear that the applicant's date of invention under these provisions is to be calculated according to the same basic rules that are used in connection with 102(g). Thus, an applicant will be held to have `invented' the subject matter at issue, for paragraphs 102(e) and (a), when he has both conceived and reduced to practice.
R. Carl Moy, Moy's Walker on Patents § 8.132 (internal citations omitted). As a further example, under the Federal Regulations, an inventor can do this by "swearing behind" in patent prosecution proceedings, that is, file a "131 declaration," pursuant to 37 C.F.R. § 1.131, "to demonstrate that [his] date of invention is prior to the effective date of the [alleged prior art]." In re Asahi/America, Inc., 68 F.3d 442, 445 (Fed.Cir.1995) (citing In re Eickmeyer, 602 F.2d 974 (C.C.P.A.1979)). The text of the relevant regulation states:
(a) When any claim of an application or patent under reexamination is rejected, the inventor of the subject matter of the rejected claim . . . may submit an appropriate oath or declaration to establish invention of the subject matter of the rejected claim prior to the effective date of the reference or activity on which the rejection is based. The effective date of a U.S. patent . . . is the earlier of its publication date or date that it is effective as a reference under 35 U.S.C. § 102(e). . . .
(b) The showing of facts shall be such, in character and weight, as to establish reduction to practice prior to the effective date of the reference, or conception of the invention prior to the effective date of the reference coupled with due diligence from prior to said date to a subsequent reduction to practice or to the filing of the application.
37 C.F.R. § 1.131; see also 35 U.S.C. § 102(g). In the context of invalidity claims, invention requires conception and reduction to practice:
Conception is the formation in the mind of the inventor, of a definite and permanent idea of the complete and operative invention, as it is hereafter to be applied in practice. Actual reduction to practice requires that the claimed invention work for its intended purpose, and, as has long been the law, constructive reduction to practice occurs when a patent application on the claimed invention is filed.
*845 Hybritech Inc. v. Monoclonal Antibodies, Inc., 802 F.2d 1367, 1376 (Fed.Cir.1986) (internal citations and quotation marks omitted). Both conception and reduction to practice are legal determinations for the court to make. Standard Mfg. Co., Inc. v. United States, 25 Cl.Ct. 1, 62 (Cl.Ct.1991).
"Conception is the `formation in the mind of the inventor, of a definite and permanent idea of the complete and operative invention, as it is hereafter to be applied in practice.'" Hybritech Inc. v. Monoclonal Antibodies, Inc., 802 F.2d 1367, 1376 (Fed.Cir.1986) (quoting 1 Robinson on Patents 532 (1890)). "It is settled that in establishing conception a party must show possession of every feature recited in the count, and that every limitation of the count must have been known to the inventor at the time of the alleged conception." Coleman v. Dines, 754 F.2d 353, 359 (Fed.Cir.1985) (citing Davis v. Reddy, 620 F.2d 885, 889 (C.C.P.A.1980)).
While "[c]onception always determines inventorship, . . . actual reduction to practice determines the date of invention for section 102 purposes." Standard Mfg. Co., Inc. v. United States, 25 Cl.Ct. 1, 63 (Cl.Ct.1991). "`[P]roof of actual reduction to practice requires more than theoretical capability; it requires showing that the apparatus . . . actually existed and worked for its intended purpose.'" In re Asahi/America, Inc., 68 F.3d at 446 (quoting Newkirk v. Lulejian, 825 F.2d 1581, 1583 (Fed.Cir.1987)). An invention is reduced to practice, "when the inventive concept has been embodied in some physical form and demonstrated to be a workable embodiment of the invention." Standard Mfg. Co., Inc., 25 Cl.Ct. at 63 (citing Eastern Rotorcraft v. United States, 181 Ct.Cl. 299, 384 F.2d 429, 431 (1967)).
Constructive reduction to practice can be shown in lieu of actual reduction to practice. "The filing of a patent application is a constructive reduction to practice of the invention disclosed therein." Frazer v. Schlegel, 498 F.3d 1283, 1288 (Fed.Cir.2007) (citing Hyatt v. Boone, 146 F.3d 1348, 1352 (Fed.Cir.1998)). However, in order to constitute constructive reduction to practice, the patent application must disclose the invention "by meeting the written description and enablement requirements of 35 U.S.C. § 112 ¶ 1." Frazer, 498 F.3d at 1287.
[T]he filing date becomes a date of constructive reduction to practice in determining priority of invention and this should not be the case unless at that time, without waiting for subsequent disclosures, any person skilled in the art could practice the invention from the disclosure of the application. If information to be found only in subsequent publications is needed for such enablement, it cannot be said that the disclosure in the application evidences a complete invention. . . . [W]e now rule that application sufficiency under § 112, first paragraph, must be judged as of its filing date.
Application of Glass, 492 F.2d 1228, 1232 (C.C.P.A.1974).
Plaintiff does not contest that, if it is not entitled to a reissue of the three patents involved in this motion, the '379 and '202 Patents as well all '038 Patent claims except claim 1 are invalid as anticipated or rendered obvious by the prior art of the '974 Mazur Patent. See 35 U.S.C. § 102(e). However, § 102(e) will not act as a bar if Plaintiff can show prior (1) reduction to practice or (2) conception "coupled with due diligence from prior to [the effective filing date of the alleged prior art] to a subsequent reduction to practice or to the filing of the application." See 37 C.F.R. § 1.131(b); see also In re Costello, 717 F.2d 1346, 1349 (Fed.Cir. 1983); Standard Mfg. Co., Inc., 25 Cl.Ct. at 63.
*846 Plaintiff is attempting to "swear behind" the '974 Mazur Patent. David S. Breed, inventor of the patents at issue, submitted a declaration that states that his "conception and reduction to practice" of the "use of an electronic sensor in an application for side impacts of a vehicle, so as to operate a passenger restraint system," is "set forth in at least U.S. Patent 5,231,253" as "constructive reduction to practice, based upon the filing of the patent application." (Pl.'s Resp. Ex. D ¶ 2.) In his declaration, Breed also states that "further evidence of my conception and reduction to practice of the use of an electronic sensor in side impacts of a vehicle in the patent specification of U.S. [sic] 6,009,970," in which he referenced an electronic sensor model made by Mercedes. (Id. ¶ 4.)
To show prior invention for purposes of § 102(e),[5] Plaintiff argues that (1) conception and constructive reduction to practice can be proved by the date of the '253 application, February 23, 1989, or in the alternative, (2) by the combination of the '253 and '970 applications, with an effective date of July 9, 1991. First, Plaintiff argues that the '253 Patent demonstrates conception and reduction to practice prior to the effective filing date of the '974 Mazur Patent. But to constitute constructive reduction to practice, an application or patent must comply with the enabling requirements of 35 U.S.C. § 112 ¶ 1.[6]Bigham v. Godtfredsen, 857 F.2d 1415, 1417 (Fed.Cir.1988) ("To serve as constructive reduction to practice, the disclosure of the subject matter . . . must meet the requirements of 35 U.S.C. § 112, first paragraph."); see also Rengo Co. Ltd. v. Molins Mach. Co., Inc., 657 F.2d 535, 548 (3d Cir.1981) ("[A]n American application will be regarded as a reduction to practice only if it describes the invention with the particularity required by Section 112."). This court found the '253 Patent invalid for lack of enablement under § 112 ¶ 1 because the '253 Patent did not teach those skilled in the art how to make and use a side impact sensor with an electronic means for initiating an occupant protection apparatus. ATI I, 378 F.Supp.2d at 814-15, aff'd, 501 F.3d 1274 (Fed.Cir.2007). In particular, the court noted that defendants' expert stated that the '253 Patent did not teach "(1) how to sense the motion of the mass to properly output a stream of data; and (2) how to appropriately process this data to determine if the motion of [the] mass upon acceleration of [the sensor's] housing exceeds a predetermined threshold value, triggering the initiation of an occupant protection apparatus." ATI I, 378 F.Supp.2d at 815 (internal quotation omitted). Because the '253 Patent was found invalid for lack of enablement, the '253 Patent cannot constitute constructive reduction to practice such that Plaintiff can overcome Defendants' § 102(e) invalidity contentions. See Bigham, 857 F.2d at 1417.
*847 Moreover, Plaintiff cannot show conception on the basis of the '253 Patent. To show conception, "a party must show possession of every feature recited in the count, and that every limitation of the count must have been known to the inventor at the time of the alleged conception." Coleman, 754 F.2d at 359 (citing Davis, 620 F.2d at 889). The '253 Patent was invalid for lack of enablement, specifically because while it disclosed the use of mechanical side impact sensors, it did not disclose electronic side impact sensors, which are "a distinctly different sensor compared with the well-enabled mechanical side impact sensor" that was "fully discussed in the specification." ATI, 501 F.3d at 1285. The '974 Mazur Patent and the patents at issue in this case disclose an electronic sensor for detecting lateral acceleration[7] which the '253 Patent does not disclose.
The '253 Patent, therefore, does not offer corroborating evidence of conception. See Coleman, 754 F.2d at 359 (citing Davis, 620 F.2d at 889). Finally, Plaintiff has not offered any showing, nor even asserted, diligence "from prior to [the effective filing date of the alleged prior art] to a subsequent reduction to practice or to the filing of the application." 37 C.F.R. § 1.131(b). Therefore, the '253 Patent is not corroborating evidence of Plaintiff's prior invention.
Plaintiff also argues that it has shown conception and reduction to practice through its U.S. Patent. No. 6,009,970 ("'970 Patent"), or through the combined evidence of the '253[8] and '970 Patents.
Specifically, Plaintiff argues that the specification, entitled Tape Switch Crush Sensor, demonstrates conception and constructive reduction to practice of an electronic sensor in side impacts of a vehicle because in the background section the '970 Patent references "an electronic sensor such as is part of the Mercedes air bag system." '970 Patent col. 1 l. 24-25; (see also Pl.'s Resp. Ex. D. ¶ 4). Plaintiff contends that this statement in the '970 Patent, together with the invention disclosed in the '253 Patent show that inventor Breed had the conception for an electronic sensor to measure lateral acceleration to be used in the event of a side impact to a vehicle to trigger the deployment of an occupant restraint system by 1991, and prior to the effective filing date of the '974 Mazur Patent. (Pl.'s Resp. at 4-5.)
In pertinent part, the '970 Patent states: "Three types of sensors have been widely used to sense and initiate deployment of an air bag passive restraint system. These sensors include . . . an electronic sensor such as is part of the Mercedes air bag system." 970 Patent col. 1 l. 19-21, 25-26. Inventor Breed states that the referenced Mercedes system demonstrates he knew of electronic sensors used in frontal crash *848 airbag sensing applications. (Pl.'s Resp. Ex. D ¶ 4.) Plaintiff further argues that the declaration, together with the '970 and '253 Patents are sufficient to demonstrate conception, no later than July 9, 1991, predating the effective filing date of the '974 Mazur Patent.[9]
As discussed above with respect to the '253 Patent and the issue of constructive reduction to practice, if an application or patent is to demonstrate the reduction to practice requirement, the application or patent must comply with the enabling requirements of 35 U.S.C. § 112 ¶ 1.[10]See Bigham, 857 F.2d at 1417; see also Rengo Co. Ltd., 657 F.2d at 548.
The '970 Patent does not fully enable what is disclosed in the patents at issue in the instant motion; indeed, the '970 Patent does not even disclose essential portions of the three patents. It does not disclose side impact sensors, or the included microprocessor, algorithm, or movable sensing mass. Furthermore, the '970 Patent cannot serve as evidence of conception for the patents at issue for the same reason that the '253 Patent could not: it does not show "`formation in the mind of the inventor, of a definite and permanent idea of the complete and operative invention, as it is hereafter to be applied in practice.'" See Hybritech Inc., 802 F.2d at 1376 (quoting 1 Robinson on Patents 532 (1890)). The '970 Patent merely demonstrates that the inventor knew electronic sensors had been used in frontal crash systems used for the deployment of airbags in the event of a frontal crash. In particular, the '970 provides for a "crush switch crash sensor which functions when a portion of the vehicle where the sensor is mounted is displaced, deformed or otherwise bends or buckles." '970 Patent col. 2 l. 45-50. The '970 Patent describes its improvements over earlier tape switch versions as being able to discriminate between large frontal forces exerted on a vehicle which are indicative of a crash, in contrast to non-crash events. Id. col. 2 l. 31-41. None of the cited references by Plaintiff, however, disclose a "complete and operative invention" prior to the '974 Patent such that Plaintiff has shown conception. Nor has Plaintiff produced or even asserted diligence "from prior to [the effective filing date of the alleged prior art] to a subsequent reduction to practice or to the filing of the application," a requirement conjunctive with that of conception. See 37 C.F.R. § 1.131(b). Therefore, Plaintiff has not provided evidence of its prior invention on the basis of the '970 Patent.
Plaintiff further argues that the combined evidence of the '253 and '970 Patents provides evidence of conception. Plaintiff contends that the '970 Patent demonstrates that Plaintiff knew an electronic sensor, such as the one referenced in the background section of the specification, could be used in conjunction with the invention described in the '253 Patent. (Pl.'s Resp. at 4-5.) The "`formation in the mind of the inventor, of a definite and permanent idea of the complete and operative invention, as it is hereafter to be applied in practice'" is required to show conception. Hybritech Inc., 802 F.2d at 1376 (quoting 1 Robinson on Patents 532 (1890)). As explained, infra, "[i]t is settled that in establishing conception a party *849 must show possession of every feature recited in the count, and that every limitation of the count must have been known to the inventor at the time of the alleged conception." Coleman, 754 F.2d at 359 (citing Davis, 620 F.2d at 889); see also Kridl v. McCormick, 105 F.3d 1446, 1449 (Fed.Cir.1997) (citing Davis, 620 F.2d at 889). But even the combined evidence of the '253 and '970 Patents does not show conception prior to the '974 Mazur Patent because the patents do not show an electronic sensor for sensing lateral acceleration coupled to a microprocessor with an algorithm for determining whether acceleration has passed a certain threshold such that the passenger restraint system should deploy. The '253 Patent does not disclose such an electronic sensor, and while the '970 Patent acknowledges the existence of electronic sensors, it does so in the context of frontal crash systems rather than side impact systems.
Furthermore, even if the '253 and the '970, taken together, offer corroborating evidence of conception, reduction to practice would not occur until the patents at issue were filed. This date would be too late to allow swearing behind the '974 Mazur Patent, unless Plaintiff was diligent "from prior to [the Mazur Patent's effective filing date] to a subsequent reduction to practice or to the filing of the application." See 37 C.F.R. § 1.131(b). Plaintiff neither presents evidence of nor even alleges diligence. Because diligence is required where a patented invention's conception precedes the prior art's conception but its reduction to practice follows the prior art's reduction to practice, Plaintiff cannot show prior invention based on the '974 Patent.
b. Application for Reissue of the '038 Patent
Plaintiff argues that the patents are not invalid under § 102(e) because Plaintiff filed for reissue of the '038 Patent on July 13, 2009, pursuant to 35 U.S.C. § 120. In its brief, Plaintiff contends that it is entitled to a reissue of the '038 as a continuation-in-part of the '970 Patent, which will in turn entitle each of the patents at issue to an effective filing date of July 9, 1991.[11] Plaintiff argues that the '970 Patent discloses the structure designed to function when "a portion of the vehicle where the sensor is mounted is displaced, deformed or otherwise bends or buckles," and captures the conception of the patents at issue in this case.
Section 35 of Title 120 provides the statutory basis for continuation-in-part applications:
An application for patent for an invention disclosed in the manner provided by the first paragraph of section 112 of this title in an application previously filed in the United States, . . . shall have the same effect, as to such invention, as though filed on the date of the prior application, if filed before the patenting or abandonment of or termination of proceedings on the first application or on an application.
35 U.S.C. § 120. A continuation-in-part application thus gives a later-filed application *850 the benefit of the filing date of an earlier-filed application. Id.
One court has explained the significance of `continuation-in-part' status: "A continuation-in-part application . . . is an application that is filed during the pendency of the original or parent application of the same inventor, disclosing and claiming some subject matter common to the parent application, as well as some subject matter not common to and not supported by the parent. The common subject matter is entitled to [the] filing date of the parent application while the non-common subject matter, i.e., new matter, is only entitled to the actual filing date of the later filed continuation-in-part application." Reynolds Metals Co. v. Continental Group, Inc., 525 F.Supp. 950, 970 (N.D.Ill.1981).
Electronic Planroom, Inc. v. McGraw-Hill Companies, 135 F.Supp.2d 805, 827 n. 20 (E.D.Mich.2001). A later-filed patent application is entitled to the earlier effective filing date only to the extent that the later-filed application "`disclos[es] and claim[s] some subject matter common to the parent application.'" Electronic Planroom, Inc., 135 F.Supp.2d at 827 n. 20 (quoting Reynolds Metals Co., 525 F.Supp. at 970). Moreover, to gain the benefit of the earlier-filed application, the invention of the later-filed application must be fully disclosed in accord with the first paragraph of § 112[12] in the earlier-filed application. 35 U.S.C. § 120. Indeed, the court discussed this issue above, finding that the '970 Patent could not be found to enable the patents at issue in this motion. Plaintiff's argument is a recapitulation and attempt to obtain official sanction of Plaintiff's contentions that the '379, '038, and '202 Patents are entitled to an effective filing date of July 1991, equivalent to the '970 Patent's filing date.
Plaintiff does not provide any substantiation for the assertion that its application has merit. Nor does Plaintiff cite any legal authority for holding this motion in abeyance while its application for reissue is pending. Indeed, Plaintiff filed its application for reissue on July 13, 2009twelve days after Defendants' motion for summary judgment on this issue was filed. The application for reissue, viewed in the light of the court's discussion of the identified infirmities, amounts to a delay tactic and is not persuasive.
c. '038 Patent
Finally, while Plaintiff does not dispute that the '379 and '202 Patents are anticipated or rendered obvious by the '974 Mazur Patent, Plaintiff argues that the '974 Mazur Patent does not anticipate the '038 Patent. Specifically, Plaintiff argues that the claim 1 of the '038 Patent claims a "means . . . for transferring" or a "transfer structure"[13] for transferring lateral acceleration to the sensor, consisting of a movable mass in the interior of a housing such that the movable mass moves within the interior of the housing in response to lateral acceleration exerted on the outer skin of the vehicle, and transferred through the transferring means to the sensor.
*851 Defendants argue that relevant language of the '974 Mazur Patent states:
The depression 304 is adapted to receive an accelerometer 306. The accelerometer 306 is the same as accelerometer 50. The accelerometer is secured in the depression 304 by any one of several means such as by gluing. The depression 304 spaces the accelerometer 306 a distance . . . from the outer door panel 303 which adds further protection for the accelerometer 306.
A plurality of strengthening or reinforcing beams 310, 312, and 314 are formed in the inner door panel 302 . . . to provide better communication to the accelerometer 306 of the sideways acceleration of the vehicle that results from a side impact. Communication of the sideways acceleration is enhanced by limited acceleration attenuation that would otherwise occur from an unstiffened or unreinforced inner door panel. If the inner door panel was not reinforced, the accelerometer would tend to have an initially lower acceleration during a side impact because the inner door panel would flex. This flexing of the inner door panel has an effect of attenuating the acceleration of the accelerometer.
'974 Mazur Patent col. 7 l. 61-col. 8 l. 14. Defendants further explain that the '974 Mazur Patent discloses a structure for transferring lateral acceleration in the event of a side impact to a vehicle to a side impact crash sensor. Even though the '974 Mazur Patent does not disclose a transfer structure, Defendants say, such a structure is obvious as admitted by Plaintiff's inventor.
In its claim construction order of November 25, 2008, the court construed "means . . . for transferring" as "means interposed between the outer skin along the side of the vehicle and said sensor for transferring the lateral acceleration to said sensor through a plate mounted on a main structural beam in the door." The court construed "transfer structure . . . arranged to transfer the lateral acceleration to said sensor" similarly, as a "transfer structure interposed between the outer skin along the side of the vehicle and said sensor for transferring the lateral acceleration to said sensor through a plate mounted on the main structural beam in the door."
Inventor Breed made the following statements:
Q: While there may be other things, do you feel one of ordinary skill in the art can take that disclosure and understand that to teach it means interposed between the outer skin along the side of the vehicle and said sensor for transferring the lateral acceleration to the sensor.
A: One with ordinary skill in the art would know that this is a sensor that's designed to go into the crush zone of the vehicle. In other words, it has to see that the pulse of a car hitting the vehicle, regardless of where the car actually hits the vehicle. . . .
So anyone with ordinary skill in the art would know that there has to be some kind of a rigid transfer structure from wherever the car hits, wherever the car might potentially hit, and where the sensor is. . . .
[Y]ou can put the sensor anywhere in the car as long as you put a beam from where the car's going to get hit to that sensor.
Q: And that's obvious to one of ordinary skill in the art with or without your teachings, correct?
A: Yes, I think it would be.
(Defs.' Mot. Ex. M, Breed Dep. 97-98.) Inventor Breed admitted that the transfer *852 structure would be obvious to one skilled in the art. Section 103 provides the standard for invalidity based on obviousness, stating in pertinent part:
A patent may not be obtained though the invention is not identically disclosed or described as set forth in section 102 of this title, if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains.
35 U.S.C. § 103(a). Obviousness under 35 U.S.C. § 103(a) is ultimately a legal question, based on underlying factual determinations. See Richardson-Vicks, Inc., 122 F.3d at 1479. Clear and convincing evidence exists when the movant "place[s] in the mind of the ultimate fact finder an abiding conviction that the truth of its factual contentions are `highly probable.'" Colorado v. New Mexico, 467 U.S. 310, 316, 104 S.Ct. 2433, 81 L.Ed.2d 247 (1984).
The inventor having admitted that the disputed claim would be obvious to one having ordinary skill in the art, the claim is not novel under § 101, and the '038 Patent is invalid. See Knoll Pharm. Co., Inc., 367 F.3d at 1384 (citing Monarch Knitting Mach. Corp., 139 F.3d at 881) ("The accused infringer must prove by clear and convincing evidence that each claim that is challenged cannot reasonably be held to be non-obvious."). Finally, because this claim would be obvious, disclosure of it in the prior art, the '974 Mazur Patent, is not required in order to satisfy the requirements for a finding of invalidity pursuant to § 102(e).
B. Invalidity of the '824 Patent Based on Prior Art
Defendants Hyundai, Kia, Nissan, TRW, and TK Holdings filed a motion for summary judgment asserting the invalidity of the '824 Patent on the basis of prior art. In particular, Defendants argue that the '824 Patent is anticipated or rendered obvious by the prior art of U.S. Patent No. 5,439,249 ("'249 Steffens Patent"), which has an effective filing date of December 2, 1993. Because the '824 Patent has, at the earliest, an effective filing date of June 7, 1995, the '249 Steffens Patent constitutes prior art pursuant to § 102(e). The court has reviewed the motion and finds it persuasive. Additionally, Eastern District of Michigan Local Rule 7.1 requires that any party opposing a motion file a response. E.D. Mich. LR 7.1(b). ATI did not address the motion, essentially conceding the issue raised, and the court will therefore grant the motion for summary judgment asserting the invalidity of the '824 Patent. See E.D. Mich. LR 7.1(b).
IV. CONCLUSION
For the reasons set forth above, IT IS ORDERED that Defendants' motion for summary judgment of invalidity as to U.S. Patent Nos. 7,025,379, 7,052,038, and 7,070,202 [Dkt. # 113] is GRANTED.
IT IS FURTHER ORDERED that the Defendants' motion for summary judgment of invalidity as to U.S. Patent No. 6,850,824 [Dkt. # 115] is GRANTED.
Finally, IT IS ORDERED that Defendants' remaining motions for summary judgment [Dkt. ## 108, 109, 110, 111, 112, 116, 119, 120] are DENIED AS MOOT.
NOTES
[1] The facts set forth in the Introduction section are taken from the court's November 25, 2008 Markman order, 2008 WL 5085389.
[2] The Federal Circuit did not reach this court's additional rationale of undue experimentation under the factors of In re Wands, 858 F.2d 731 (Fed.Cir. 1988).
[3] In ATI I, Plaintiff defined one having ordinary skill in the art as "a person having a four-year degree in mechanical, electro-mechanical or automotive engineering, plus several years [of] experience in the field or the equivalent." ATI I, 378 F.Supp.2d 780, 801-02 (E.D.Mich.2005). No reason exists to depart from this definition at this time.
[4] Much of the case law regarding this point arises in the context of patent prosecutions, pursuant to 37 C.F.R. § 1.131. Both the case law and the parties, however, appear to be in agreement that the same standard applies in this context as well. See, e.g., Therasense, Inc. v. Becton, Dickinson and Co., 560 F.Supp.2d 835, 864 (N.D.Cal.2008) (finding that because a patent was reduced to practice prior to the effective filing date of the alleged prior art, the patent was not rendered invalid pursuant to § 102(e)); DevTech Marketing, Inc. v. Westfalia-Surge, Inc., 2005 WL 6287929, at *14 (C.D.Cal. Apr. 19, 2005) (stating that to show prior invention such that § 102(e) is inapplicable, a party must should either reduction to practice or conception together with diligence in reducing the invention to practice).
[5] The parties only dispute the existence of constructive reduction to practice, therefore the court will not address the issue of actual reduction to practice.
[6] In its brief, Plaintiff argues that conception and enablement are distinct requirements, and, indeed, Plaintiff identifies supporting case law for this contention. Burroughs Wellcome Co. v. Barr Labs., Inc., 40 F.3d 1223, 1231 (Fed.Cir.1994). To overcome invalidity on the basis of § 102(e), however, Plaintiff must show either (1) reduction to practice or (2) conception "coupled with due diligence from prior to said date to a subsequent reduction to practice or to the filing of the application." 37 C.F.R. § 1.131(b); see Standard Mfg. Co., Inc., 25 Cl.Ct. at 63; see also In re Asahi/America, Inc., 68 F.3d 442, 444-45 (Fed.Cir.1995). When a patent application is used to show constructive reduction to practice, it must meet the requirements of § 112 ¶ 1. Bigham, 857 F.2d at 1417; Yasuko Kawai v. Metlesics, 480 F.2d 880, 886 (C.C.P.A. 1973).
[7] The '974 Mazur Patent discloses a sensor that "is preferably a directionally responsive accelerometer. . . . When such a sensor is appropriately biased, an electrical output signal 52 is provided having a magnitude value functionally related to the sideways acceleration of the vehicle, i.e., acceleration of the vehicle in a direction normal to the door 22." '974 Mazur Patent col. 4 l. 37-38, 54-59. The '974 Mazur Patent also discloses a preferred model sensor. Id. col. 4 l. 52-54.
[8] Plaintiff argues in a footnote that, even if the '253 Patent is invalid for lack of enablement, the Breed PCT Application includes the same disclosures as the '253 Patent. Defendants argue that the Breed PCT Application is prior art under § 102(b) to the '202 Patent. Plaintiff further argues that if the Breed PCT Application is prior art under § 102(b), it can also demonstrate conception prior the effective filing date of the '974 Mazur Patent. However, the court views these as alternative arguments by Defendants under the varying defenses of § 102.
[9] Plaintiff does not argue, nor would the court find, that the '970 Patent alone demonstrates conception and reduction to practice.
[10] In its brief, Plaintiff argues that its has the met the requirements for showing conception, but Plaintiff does not address any of the issues relating to constructive reduction to practice. See Polaroid Corp. v. Eastman Kodak Co., 641 F.Supp. 828 (D.Mass.1985) (citing Hazeltine Research v. Brenner, 382 U.S. 252, 255-56, 86 S.Ct. 335, 15 L.Ed.2d 304 (1965); Radio Corp. of Am. v. Int'l Standard Electric Corp., 232 F.2d 726 (3d Cir.1956)).
[11] Plaintiff is not entitled to, nor does it argue that it is, the February 23, 1989 effective filing date of the '253 Patent because the '253 Patent issued on July 27, 1993, before the effective filing date of the patents at issue in this case, which was September 16, 1993. 35 U.S.C. § 120 ("An application for patent for an invention disclosed in the manner provided by the first paragraph of section 112 of this title in an application previously filed in the United States, . . . shall have the same effect, as to such invention, as though filed on the date of the prior application, if filed before the patenting or abandonment of or termination of proceedings on the first application or on an application."); Electronic Planroom, Inc. v. McGraw-Hill Companies, Inc., 135 F.Supp.2d 805, 827 n. 20 (E.D.Mich.2001).
[12] Paragraph 1 of 35 U.S.C. § 112 states:
The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor of carrying out his invention.
35 U.S.C. § 112.
[13] Plaintiff does not argue that any other '038 Patent claims are not anticipated by the '974 Patent.
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Case: 18-40408 Document: 00514959303 Page: 1 Date Filed: 05/16/2019
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
May 16, 2019
No. 18-40408
Lyle W. Cayce
Clerk
LUCA CICALESE, Medical Doctor; CRISTIANA RASTELLINI, Medical
Doctor,
Plaintiffs - Appellants
v.
THE UNIVERSITY OF TEXAS MEDICAL BRANCH,
Defendant - Appellee
Appeal from the United States District Court
for the Southern District of Texas
Before ELROD, WILLETT, and DUNCAN, Circuit Judges.
STUART KYLE DUNCAN, Circuit Judge:
Luca Cicalese, M.D., and Cristiana Rastellini, M.D. (“Cicalese and
Rastellini” or “Appellants”), appeal the dismissal of their Title VII national
origin discrimination claims against the University of Texas Medical Branch
at Galveston (“UTMB”). We affirm in part and vacate and remand in part.
I.
Cicalese and Rastellini, a married couple, were born in Italy. They moved
to the United States and both began working for UTMB in 2007. Cicalese
worked as a tenured professor and director of UTMB’s Transplant and Organ
Failure Center. Rastellini accepted a tenure-track faculty position and directed
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No. 18-40408
UTMB’s Transplant and Cellular Transplantation research. When they
arrived in the United States, neither was licensed to practice medicine in
Texas. But UTMB granted them faculty medical licenses and offered to renew
those licenses indefinitely. All went well for several years: Cicalese was
appointed UTMB’s director of Hepatobiliary Surgery and created a Ph.D.
program for international students in 2012; Rastellini opened a new clinical
islet transplant program.
But, according to the allegations in the First Amended Complaint, the
couple began having problems after Dr. Danny Jacobs joined UTMB as Dean
in late 2012. Soon after being hired, Jacobs said to the couple, “What are you
doing here? You should go back to Italy.” Jacobs altered job performance
evaluation criteria so that Rastellini could not achieve positive evaluations
without obtaining funding from the National Institutes of Health. As a result,
Rastellini received negative evaluations and was moved to an “inadequate”
laboratory to make room for another researcher. Jacobs also refused to
publicize an “Order of Merit” presented to Rastellini from the President of
Italy. Cicalese fared no better under Jacobs’s leadership. Jacobs suspended
UTMB’s liver transplant program, removed Cicalese from his position as
director of the Transplant and Organ Failure Center, and investigated
Cicalese’s handling of liver cancer surgeries. Cicalese believes this
investigation was a “sham” meant to discredit him.
The couple’s problems intensified in late 2014 when Jacobs hired Dr.
Douglas Tyler as chairman of surgery. Tyler, when speaking of the Italian
Ph.D. students in Cicalese’s program, said he did not care about “these
Italians.” And, perhaps more than once, Tyler referred to “stupidity” and
failure to “understand[] a situation” as an “Italian thing.” Tyler excluded
Rastellini from departmental activities and made demeaning comments about
her work. Rastellini was forced to cease her own research and “work for
2
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No. 18-40408
another, less-experienced” researcher. She was demoted to “a part-time, non-
tenure track position at a significantly lower pay rate.” Tyler also reduced
Cicalese’s salary, restricted his work, refused to provide him favorable
references, and demeaned him and his work. Cicalese’s director titles were
“reassigned to American Doctors who are less qualified than Dr. Cicalese.” In
addition, Tyler instated a new policy rescinding all permanent faculty
licensure waivers. According to Appellants, this was meant to target them as
the “[o]nly two physicians” at UTMB who benefited from the permanent
waiver, and they were both Italians.
The couple sued UTMB, alleging that “[d]irect and/or circumstantial
evidence exists showing that [UTMB] intended to discriminate against [them]
because of their national origin, in violation of Title VII.” UTMB moved to
dismiss under Federal Rule of Civil Procedure 12(b)(6). The district court
granted UTMB’s motion, concluding the couple had failed to state a plausible
national origin discrimination claim or a hostile work environment claim under
Title VII. Cicalese and Rastellini appeal, arguing the district court erred by
holding they failed to state a claim for national origin discrimination. 1
II.
We review de novo a district court’s dismissal under Rule 12(b)(6). Equal
Access for El Paso, Inc. v. Hawkins, 509 F.3d 697, 701–02 (5th Cir. 2007). “To
survive a motion to dismiss, a complaint must contain sufficient factual matter
which, when taken as true, states ‘a claim to relief that is plausible on its face.’”
Innova Hosp. San Antonio, Ltd. P’ship v. Blue Cross & Blue Shield of Ga., Inc.,
892 F.3d 719, 726 (5th Cir. 2018) (quoting Bell Atl. Corp. v. Twombly, 550 U.S.
1 Appellants have failed to contest on appeal the dismissal of their hostile work environment
claims. Any error as to those claims is therefore waived. See Valle v. City of Houston, 613
F.3d 536, 544 n.5 (5th Cir. 2010).
3
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No. 18-40408
544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads
factual content that allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009). A complaint “does not need detailed factual allegations,” but the
facts alleged “must be enough to raise a right to relief above the speculative
level.” Twombly, 550 U.S. at 555 (citing 5 WRIGHT & MILLER, FED. PRAC. &
PROC. § 1216, 235–36 (3d ed. 2004)).
III.
On appeal, Appellants contend the district court erred by holding them
to a heightened pleading standard when dismissing their national origin
disparate-treatment claims. 2 “Disparate-treatment discrimination addresses
employment actions that treat an employee worse than others based on the
employee’s race, color, religion, sex, or national origin. In such disparate-
treatment cases, proof and finding of discriminatory motive is required.”
Pacheco v. Mineta, 448 F.3d 783, 787 (5th Cir. 2006). A plaintiff can prove
discriminatory motive through either direct or circumstantial evidence. Portis
v. First Nat’l Bank of New Albany, Miss., 34 F.3d 325, 328 (5th Cir. 1994).
When a plaintiff builds a case on circumstantial evidence, a court analyzes the
plaintiff’s claim under the McDonnell Douglas framework. See Laxton v. Gap
Inc., 333 F.3d 572, 578 (5th Cir. 2003). “Under this framework, the plaintiff
2 The district court also concluded that “Cicalese and Rastellini have not pled a disparate-
impact theory in their complaint.” Appellants seem to contest that conclusion on appeal, but
their entire argument on that score is the following: “Because the only physicians affected
[by the Faculty Temporary License Extensions policy] were Italian, Dr. Cicalese’s claim
would be in the nature of both a disparate treatment and a disparate impact claim, contrary
to the Court’s holding.” (emphasis added). Even assuming Appellants pleaded a disparate-
impact claim in their live complaint, this “passing reference” is insufficient to prevent waiver
on appeal. Hollis v. Lynch, 827 F.3d 436, 451 (5th Cir. 2016). We therefore affirm the district
court’s conclusion that Appellants failed to plead a disparate-impact claim.
4
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No. 18-40408
must first create a presumption of discrimination by making out a prima facie
case of discrimination.” Id.
In Appellants’ view, the district court confused the plausibility pleading
standard of Twombly/Iqbal with the evidentiary standard of McDonnell
Douglas. Under the Twombly/Iqbal pleading standard, a complaint must
“state a claim to relief that is plausible on its face.’” Twombly, 550 U.S. at 570.
This differs, of course, from the McDonnell Douglas standard, which
“established an allocation of the burden of production and an order for the
presentation of proof in Title VII discriminatory-treatment cases.” St. Mary’s
Honor Ctr. v. Hicks, 509 U.S. 502, 506 (1993).
Appellants are right, as the district court acknowledged, that the
Supreme Court has distinguished the McDonnell Douglas evidentiary
standard from pleading requirements. See Swierkiewicz v. Sorema N.A., 534
U.S. 506, 510–11 (2002). Accordingly, “a plaintiff need not make out a prima
facie case of discrimination [under McDonnell Douglas] in order to survive a
Rule 12(b)(6) motion to dismiss for failure to state a claim.” Raj v. La. State
Univ., 714 F.3d 322, 331 (5th Cir. 2013). A district court therefore errs by
requiring “a showing of each prong of the prima facie test for disparate
treatment at the pleading stage[.]” Id. But we have also explained that,
although plaintiffs do not “have to submit evidence to establish a prima facie
case of discrimination at this stage, [they must] plead sufficient facts on all of
the ultimate elements of a disparate treatment claim to make [their] case
plausible.” Chhim v. Univ. of Tex. at Austin, 836 F.3d 467, 470 (5th Cir. 2016)
(emphasis added).
Thus, our task is to identify the ultimate elements of a disparate
treatment claim and then determine whether the district court erred by
requiring Appellants to plead something beyond those elements to survive a
motion to dismiss. As we have stated, there are two ultimate elements a
5
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No. 18-40408
plaintiff must plead to support a disparate treatment claim under Title VII:
(1) an “adverse employment action,” (2) taken against a plaintiff “because of
her protected status.” See Raj, 714 F.3d at 331 (quoting Kanida v. Gulf Coast
Med. Pers. LP, 363 F.3d 568, 576 (5th Cir. 2004)); see also id. (explaining a
plaintiff must allege “facts, [either] direct or circumstantial, that would
suggest [the employer’s] actions were based on [the plaintiff’s] race or national
origin or that [the employer] treated similarly situated employees of other
races or national origin more favorably”); Pacheco, 448 F.3d at 787 (a
“discriminatory motive is required” for disparate treatment claims). If a
plaintiff’s disparate treatment claim depends on circumstantial evidence, he
will “ultimately have to show” that he can satisfy the McDonnell Douglas
framework. Chhim, 836 F.3d at 470. In such cases, we have said that it can be
“helpful to reference” that framework when the court is determining whether
a plaintiff has plausibly alleged the ultimate elements of the disparate
treatment claim. See, e.g., id. at 470–71 (considering whether the plaintiff
pleaded facts suggesting that the employer hired an applicant who was
“similarly situated” to the plaintiff or “less qualified” than the plaintiff in
accordance with the McDonnell Douglas framework).
We reiterate, however, that a court errs by requiring a plaintiff to plead
something more than the “ultimate elements” of a claim. Id. at 470. A court
thus inappropriately heightens the pleading standard by subjecting a
plaintiff’s allegations to a rigorous factual or evidentiary analysis under the
McDonnell Douglas framework in response to a motion to dismiss. See
Swierkiewicz, 534 U.S. at 512 (explaining “the precise requirements of a prima
facie case can vary depending on the context and were ‘never intended to be
rigid mechanized, or ritualistic’” (quoting Furnco Constr. Corp. v. Waters, 438
U.S. 567, 577 (1978))); see also Twombly, 550 U.S. at 508 (citing Swerkiewicz,
534 U.S. at 508) (explaining that the Twombly pleading standard “[does] not
6
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No. 18-40408
require[ ] heightened fact pleading of specifics, but only enough facts to state a
claim to relief that is plausible on its face”). Such inquiries are better suited to
summary judgment. See, e.g., Thompson v. City of Waco, 764 F.3d 500, 506 (5th
Cir. 2014) (explaining “that further assessment of [appellant’s] claim is fact-
intensive and better suited for the summary-judgment or trial stage”).
The district court found Appellants did not allege facts plausibly showing
any adverse actions taken because of their national origin. The court reasoned
Appellants did not allege with adequate specificity that any “similarly
situated” non-Italian employee was treated differently, and it therefore
concluded they failed to plausibly allege circumstantial evidence of
discriminatory motive. Specifically, the court faulted the live complaint
because it failed to sufficiently allege how Appellants’ co-workers “were treated
differently under nearly identical circumstances.” (emphasis added). The court
also reasoned that Jacobs’s and Tyler’s derogatory statements about Italians
were mere “stray remarks” and so could not plausibly constitute direct
evidence of discriminatory motive. Cf., e.g., Raj, 714 F.3d at 331 (concluding
plaintiff’s “complaint and speculation did not allege any facts, direct or
circumstantial, that would suggest [employer’s] actions were based on
[plaintiff’s] race or national origin”). In arriving at that conclusion, the court
faulted Appellants for failing to allege precisely when and how many times
Tyler and Jacobs made derogatory remarks about Italians.
We disagree with the district court’s analysis. While a close call, we
conclude that Cicalese and Rastellini—in claiming UTMB’s various actions
against them were motivated by anti-Italian bias—alleged sufficient facts to
“nudge[ ] their claims across the line from conceivable to plausible.” Twombly,
550 U.S. at 547; see, e.g., Swierkiewicz, 534 U.S. at 514 (noting with approval
that the complaint “detailed the events” transpiring before the adverse
employment action, “provided relevant dates, and included the ages and
7
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No. 18-40408
nationalities of at least some of the relevant persons involved with [the
plaintiff’s] termination”). The district court erred by holding Appellants to a
heightened pleading standard. The court’s analysis of the complaint’s
allegations—scrutinizing whether Appellants’ fellow employees were really
“similarly situated” and whether Jacobs’s and Tyler’s derogatory statements
about Italians amounted to “stray remarks”—was more suited to the summary
judgment phase. See, e.g., Wheeler v. BL Dev. Corp., 415 F.3d 399, 405–06 (5th
Cir. 2005) (assessing, for summary judgment purposes, whether plaintiffs
adduced evidence “that they were treated less favorably than a similarly
situated person of a different race”); Reed v. Neopost USA, Inc., 701 F.3d 434,
441 (5th Cir. 2012) (“Where a plaintiff offers remarks as direct evidence [of
discrimination], we apply a four-part test to determine whether they are
sufficient to overcome summary judgment.”). At this stage of the proceedings,
a plaintiff need only plausibly allege facts going to the ultimate elements of the
claim to survive a motion to dismiss. On a de novo review of Appellants’ live
complaint, we conclude they surmounted that lower bar.
Accordingly, we vacate the district court’s dismissal of Appellants’
disparate treatment claims and remand for further proceedings. 3
IV.
We AFFIRM the district court’s judgment concerning Appellants’ Title
VII disparate impact and hostile work environment claims. We VACATE the
district court’s judgment dismissing Appellants’ Title VII disparate treatment
claim and REMAND for further proceedings consistent with this opinion.
AFFIRMED IN PART; VACATED AND REMANDED IN PART
3We need not consider UTMB’s alternative argument that Appellants failed to exhaust their
administrative remedies under Title VII. As UTMB acknowledges, the district court did not
resolve this issue in light of its dismissal order. We therefore remand to the district court for
consideration of that issue in the first instance.
8
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TENNESSEE BUREAU OF WORKERS' COMPENSATION
IN THE COURT OF WORKERS' COMPENSATION CLAIMS
AT NASHVILLE
DWIGHT MITCHELL, ) Docket Nos.: 2015-06-0954
Employee, ) 2015-06-0955
)
v. ) State File Nos.: 88416-2015
RANDSTAD NORTH AMERICA, ) 88471-2015
Employer. )
) Judge Kenneth M. Switzer
)
COMPENSATION ORDER GRANTING
MOTION FOR SUMMARY JUDGMENT
This matter came before the Court on October 4, 20 16, upon the Motion for
Summary Judgment filed by Randstad North America. The central legal issue is whether
Randstad is entitled to summary judgment due to Mr. Mitchell's failure to come forward
with evidence at this summary judgment stage supporting essential elements of his claim.
In determining this motion, the Court considered all relevant filings and holds for the
reasons set forth below that Randstad is entitled to summary judgment as a matter of law.
Therefore, Mr. Mitchell's claim is dismissed with prejudice to its refiling.
History of Claim
On April 9, 2014, Mr. Mitchell sustained work-related tnjunes while under
Randstad's employ. Randstad accepted the claim as compensable, providing medical and
temporary total disability benefits. Mr. Mitchell filed two Petitions for Benefit
Determination (PBD) on November 13,2015, claiming new injuries. 1
On November 25, 2015, the parties presented a Joint Petition before the Circuit
1
Randstad's statement of undisputed material facts claimed these PBDs were filed after the Davidson
County Circuit Court settlement, referenced later within this Order. Actually, Mr. Mitchell filed the
PBDs before entering into the settlement. However, the Court concludes this is not a material fact. In
fact, the execution of the settlement documents in Davidson County Circuit Court after filing the PBDs
further supports Randstad's position that the previous settlement included these potential claims.
Court of Davidson County to approve a settlement of $25,000. Mr. Mitchell signed that
Petition and the attached Final Decree. The Joint Petition states on April 9, 2014, Mr.
Mitchell "was involved in an accident, arising out of and in the course of his employment
with Randstad." · He sustained "additional aggravations of his injuries on September 23,
2014, and March 12, 2015." The accompanying Final Decree reads: "Said sum is a full,
final and complete settlement and discharge of Randstad North America and its insurer
from any further liability to Dwight Mitchell for any claimed medical condition or
disability under the Workers ' Compensation Law, by reason of said alleged accident or
aggravations." (Italics in original.)
Mr. Mitchell subsequently filed a Request for Expedited Hearing in the Court of
Workers' Compensation Claims seeking additional medical and temporary disability
benefits relative to the September 20 14 and March 2015 injuries. After a full evidentiary
hearing, this Court issued an Expedited Hearing Order Denying Requested Benefits. In
the Order, the Court held it lacked jurisdiction to determine the parties' rights regarding
the pre-July 1, 2014 injury. The Court further found Mr. Mitchell read, reviewed, signed
and understood "at that time" the settlement agreement, which precluded further
recovery. The Court additionally rejected Mr. Mitchell's argument raised at the hearing
regarding alleged mistakes by the authorized treating physician, reasoning that the
medical records Mr. Mitchell relied upon- a bone scan and x-ray reports- documented
the existence of additional injuries but did not explain their cause or relate them to work.
The Court Order suggested that since his arguments regarding the settlement pertain, at
least in part, to the pre-July 1, 2014 injury, Mr. Mitchell needed to raise them before the
Davidson County Circuit Court.
Mr. Mitchell appealed, but the Tennessee Workers Compensation Appeals Board
affirmed. The Appeals Board wrote:
To the extent Employee alleges that he suffered distinct, compensable
injuries on September 23, 2014 and March 12, 2015 for which he is owed
benefits under post-reform law, there is nothing in the record beyond
Employee's bare allegations supporting such a claim. To the extent
Employee alleges that he suffered aggravations on September 23, 2014 and
March 12, 2015 entitling him to additional benefits under pre-reform law
and that the parties' court-approved settlement should be set aside, such
arguments should be addressed to the Davidson County Circuit Court. We
note that prior to this action, Employee characterized the incidents at issue
as aggravations of the April 9, 2014 injury, which were specifically
addressed in the parties' court-approved settlement.
Mitchell v. Randstad N. Am., et al., Nos. 2015-06-0954, 2015-06-0955, 2016 TN Wrk.
Comp. App. Bd. LEXIS 32, at *4-5 (Tenn. Workers' Comp. App. Bd. Aug. 11, 2016).
2
Randstad filed its Motion for Summary Judgment, along with a Statement of
Undisputed Material Facts and a Memorandum of Facts and Law in Support of the
Employer's Motion for Summary Judgment. At a subsequent initial hearing, counsel for
Randstad informed the Court it sent Mr. Mitchell, who is self-represented, a copy of Rule
56. Randstad argued that both this Court and the Appeals Board found the settlement
agreement acknowledged Mr. Mitchell's aggravations and he accepted $25,000 in
consideration for releasing Randstad from any additional liability arising out of the April
9, 2014 injury. Randstad additionally noted Mr. Mitchell filed a motion seeking relief
from judgment under Rule 60 in Davidson County Circuit Court.
Mr. Mitchell filed a Response to the Statement of Undisputed Material Facts. He
denied all but two of the eight factual statements, offering argument rather than contrary
facts. In particular, he disputed that the "Joint Petition was signed by both parties and
approved by the Davidson County Circuit Court as evidenced by the Final Decree,"
arguing that the Final Decree was "based on fraud on the court they did not match, fraud,
mistake bad faith negotiations, lack of meeting of the minds." He further argued the
Davidson County Circuit Court lacked subject matter jurisdiction for injuries sustained
after July 1, 2014. Mr. Mitchell additionally disputed that this Court issued an expedited
hearing order finding that he was not entitled to workers' compensation benefits. Mr.
Mitchell disputed this by referencing his Motion to Include Additional Issues, in which
he asked this Court to consider new injuries not covered by the Joint Petition and Final
Decree. The Court denied the motion as unnecessary because Mr. Mitchell listed these
injuries and conditions in response to the proposed Dispute Certification Notice, and
therefore they were properly before the Court.
Along with Mr. Mitchell's Response, he filed a Statement of Additional Disputed
Material Facts. In that list, he identified disputes regarding: 1) whether he "was given an
MMI as required by Workers' Compensation law"; 2) whether the treating doctor signed
a final medical report; 3) the validity of the Final Decree because it covers different
injuries than those of the Joint Petition; 4) the existence of new injuries occurring after
July 1, 2014, documented by new medical records; 5) whether the Circuit Court had
jurisdiction over injuries occurring/diagnosed after July 1, 2014; 6) whether the Joint
Petition represented a meeting of the minds; and 6) the "legality" of the Final Decree,
since the Circuit Court "did not even make sure the Final Decree matched the Joint
Petition." Randstad submitted no response to these statements and stated during oral
argument that it had not received a copy.
Legal Principles and Analysis
In 2011, the Tennessee General Assembly codified the burden of proof applicable
to a motion for summary judgment filed by a party who does not bear the burden of proof
at trial as follows:
3
In motions for summary judgment in any civil action in Tennessee, the
moving party who does not bear the burden of proof at trial shall prevail on
its motion for summary judgment if it:
(1) Submits affirmative evidence that negates an essential
element of the nonmoving party's claim; or
(2) Demonstrates to the court that the nonmoving party's
evidence is insufficient to establish an essential element
of the nonmoving party's claim.
Tenn. Code Ann. § 20-16-101 (2015); Payne v. D and D Electric, No. 2014-01-0023,
2016 TN Wrk. Comp. App. Bd. LEXIS 21, at *7-8 (Tenn. Workers' Comp. App. Bd.
May 4, 2016). Thus, Mr. Mitchell, as the nonmoving party, must "demonstrate the
existence of specific facts in the record which could lead a rational trier of fact to find in
[his] favor[.]" Rye v. Women's Care Ctr. of Memphis, MPLLC, 477 S.W.3d 235, 265
(Tenn. 2015). He must do more than simply show that there is some "metaphysical
doubt" as to the material facts. !d. The focus is on the evidence the Mr. Mitchell comes
forward with at the summary judgment stage, "not on hypothetical evidence that
theoretically could be adduced ... at a future trial." !d. (emphasis added).
The Court notes Mr. Mitchell's Response to Randstad's Statement of Undisputed
material facts is defective. None of the disputed facts he identified was supported by
specific citations to the record as required by Tennessee Rule of Civil Procedure 56.03, a
copy of which Randstad provided to him. Likewise, none of Mr. Mitchell's proposed
Additional Disputed Material Facts contain citations to the record in support of his
position.
Our Appeals Board held that self-represented litigants "must comply with the
same standards to which lawyers must adhere." Burnette v. K-Mart Corp., No. 2014-02-
0020, 2015 TN Wrk. Comp. App. Bd. LEXIS 2, at *6 (Tenn. Workers' Comp. App. Bd.
Jan. 20, 2015). The Board explained:
[P]arties who decide to represent themselves are entitled to fair and equal
treatment by the courts. The courts should take into account that many pro
se litigants have no legal training and little familiarity with the judicial
system. However, the courts must also be mindful of the boundary between
fairness to a pro se litigant and unfairness to the pro se litigant's adversary.
Thus, the courts must not excuse pro se litigants from complying with the
same substantive and procedural rules that represented parties are expected
to observe.
4
!d. at *6-7. Here, Mr. Mitchell failed to comply with Rule 56's requirements, and this
Court cannot excuse his noncompliance with the rules that Randstad is expected to
observe. Likewise, the Court cannot consider legal arguments that Mr. Mitchell did not
fully develop or cite to existing law for substantiation. The Tennessee Supreme Court
explained, "It is not the role of the courts, trial or appellate, to research or construct a
litigant's case or arguments for him or her." Sneed v. Bd. of Prof'! Responsibility of the
Sup. Ct. ofTenn., 301 S.W.3d 603, 615 (Tenn. 2010).
Randstad's Motion for Summary Judgment indicated it denied Mr. Mitchell's
post-July 1, 2014 claims because they were resolved by virtue of the Davidson County
Circuit Court Final Decree. Mr. Mitchell submitted nothing to challenge this assertion.
As previously stated by both this Court and the Appeals Board, Mr. Mitchell's
contentions alleging fraud, mistake and lack of meeting of the minds are issues to be
raised before the Davidson County Circuit Court. The Court of Workers' Compensation
Claims lacks authority to overrule an order of the Circuit Court. Further, Mr. Mitchell's
assertions as to designation of MMI, whether the treating physician signed a medical
report, and whether the Joint Petition represented a meeting of the minds are not material
facts to the outcome of this dispute.
Rather, in this Court's estimation, the critical, undisputed material fact is that the
parties settled all claims of "additional aggravations of his injuries on September 23,
2014, and March 12, 2015," as a "full, final and complete settlement and discharge of
Randstad North America and its insurer from any further liability[.]" Simply put, Mr.
Mitchell already obtained his remedy. As for Mr. Mitchell's assertion that the medical
records show new injuries occurred after July 1, 2014, he presented no medical proof on
this issue. 2
Applying the standards mentioned above, to overcome summary judgment, Mr.
Mitchell had to demonstrate that he could establish the essential element of his claim. In
other words, he had to show that he did not settle his claim for benefits as part of the
Davidson County Circuit Court Final Decree. The Court holds Mr. Mitchell has not
come forward with evidence at this summary judgment stage to support this essential
element of his claim for workers' compensation. Accordingly, having carefully reviewed
the evidence in a light most favorable to Mr. Mitchell, this Court concludes he failed to
demonstrate that his evidence is sufficient at this summary judgment stage to identify a
2
The Expedited Hearing Order dealt in detail with the medical proof on causation; Mr. Mitchell
presented no proof in contradiction of that issue at that hearing, either. Further, this Court rejects his
contention that the authorized treating physician was mistaken in his diagnosis and treatment. As our
Appeals Board observed, "Judges are not well-suited to second guess a medical expert's treatment,
recommendations, and or diagnoses absent some conflicting medical evidence or some other
countervailing evidence properly admitted into the record." Scott v. Integrity Staffing Solutions, No.
2015-01-0055, 2015 TN Wrk. Comp. App. Bd. LEXIS 24, at *8 (Tenn. Workers' Comp. App. Bd. Aug.
18, 2015).
5
dispute as to a material fact in this matter. See Rye, 477 S.W.3d at 265 .
IT IS, THEREFORE, ORDERED as follows:
1. Randstad's Motion for Summary judgment is granted, and Mr. Mitchell's claim
against Rands tad for the requested workers' compensation benefits is dismissed on
the merits with prejudice to its refiling.
2. The filing fee of $150.00 for this cause is taxed to the Employer, Randstad,
pursuant to Tennessee Compilation Rules and Regulations 0800-02-21-.07 (2015),
to be paid within five days of the entry of this order, and for which execution may
Issue as necessary.
3. Rands tad shall prepare and submit the SD-1 for this matter within ten days of the
date of judgment.
ENTERED this the 5th day of October, 2016.
Right to Appeal:
Tennessee Law allows any party who disagrees with this Order to appeal the
decision to the Workers' Compensation Appeals Board or the Tennessee Supreme Court.
To appeal your case to the Workers' Compensation Appeals Board, you must:
1. Complete the enclosed form entitled: "Compensation Hearing Notice of Appeal."
2. File the completed form with the Court Clerk within thirty calendar days of the
date the Workers' Compensation Judge entered the Compensation Hearing Order.
3. Serve a copy of the Compensation Hearing Notice of Appeal upon the opposing
party.
4. The appealing party is responsible for payment of a filing fee in the amount of
$75.00. Within ten calendar days after the filing of a notice of appeal, payment
must be received by check, money order, or credit card payment. Payments can be
made in person at any Bureau office or by United States mail, hand-delivery, or
other delivery service. In the alternative, the appealing party may file an Affidavit
of Indigency, on a form prescribed by the Bureau, seeking a waiver of the filing
6
fee. The Affidavit of lndigency may be filed contemporaneously with the Notice
of Appeal or must be filed within ten calendar days thereafter. The Appeals Board
will consider the Affidavit of Indigency and issue an Order granting or denying
the request for a waiver of the filing fee as soon thereafter as is
practicable. Failure to timely pay the filing fee or file the Affidavit of
lndigency in accordance with this section shall result in dismissal of the
appeal.
5. The party filing the notice of appeal, having the responsibility of ensuring a
complete record on appeal, may request, from the Court Clerk, the audio recording
of the hearing for the purpose of having a transcript prepared by a licenst(d court
reporter and filing it with the Court Clerk within fifteen calendar days of the filing
of the Compensation Hearing Notice of Appeal. Alternatively, the party filing the
appeal may file a joint statement of the evidence within fifteen calendar days of
the filing of the Compensation Hearing Notice of Appeal. The statement of the
evidence must convey a complete and accurate account of what transpired in the
Court of Workers' Compensation Claims and must be approved by the workers'
compensation judge before the record is submitted to the Clerk of the Appeals
Board. See Tenn. Comp. R. & Regs. 0800-02-22-.03 (2015).
6. After the Workers' Compensation Judge approves the record and the Court Clerk
transmits it to the Workers' Compensation Appeals Board, the appeal will be
docketed and assigned to an Appeals Board Judge for review. At that time, a
docketing notice shall be sent to the parties. Thereafter, the parties have fifteen
calendar days to submit briefs to the Appeals Board for consideration. See Tenn.
Comp. R. & Regs. 0800-02-22-.02(3) (2015).
To appeal your case directly to the Tennessee Supreme Court, the
Compensation Order must be final and you must comply with the Tennessee Rules
of Appellate Procedure. If neither party timely files an appeal with the Appeals
Board, this Order will become final by operation of law thirty calendar days after
entry, pursuant to Tennessee Code Annotated section 50-6-239(c)(7) (2015).
7
CERTIFICATE OF SERVICE
I hereby certify that a true and correct copy of the foregoing Order was sent to the
following recipients by the following methods of service on this the 5th day of October,
2016.
Name Certified Via Via Service sent to:
Mail Fax Email
Dwight Mitchell, X X DwighlrnilcbeU 1222@yahoo. com;
Self-represented 323 Forest Park Rd., Madison TN
employee 37115
W. Troy Hart, Charlie X [email protected] [email protected]
Pierce,
Employer's Attorneys
8
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181 A.2d 67 (1962)
In re ESTATE of Mae O'Neill GASKELL.
No. 375.
Supreme Court of Vermont. Chittenden.
March 7, 1962.
Reargument Denied May 1, 1962.
Joseph C. McNeil, Burlington, for proponent.
Cain & O'Brien, Burlington, for contestant.
Before HULBURD, C. J., and HOLDEN, SHANGRAW, BARNEY and SMITH, JJ.
BARNEY, Justice.
The will of the testatrix was disallowed in probate court. Only the executor named in the will sought to appeal the disallowance to county court. His attempted appeal was dismissed on motion there and he is here seeking review of that ruling.
12 V.S.A. § 2555, which is the authority under which appeals lie to the county court from probate court, reads:
"Except as otherwise provided, a person interested in an order, sentence, decree or denial of a probate court, who considers himself injured thereby, may appeal therefrom to the county court."
It is not questioned that the putative executor must justify under this statute or not at all.
The county court held that the executor did not qualify as a "person interested" in this estate. He was not a legatee, nor was he an heir. His only connection with the estate arose out of his anticipated representative capacity as executor. The single question of this appeal is whether or not this representative capacity alone makes him, in contemplation of 12 V.S.A. § 2555, a "person interested," entitled, therefore, to prosecute an appeal of the disallowance of the will to county court.
The right of a named executor to appeal the disallowance of the will appointing him has not been previously passed on in this Court. However, the lower court could find considerable support in the language used in related cases.
Early statutes gave the right of appeal to "any person or persons aggrieved at, or dissatisfied with, any decree, sentence or order of any judge of probate." Comp. *68 1824, chap. 44, § 7. In 1838, in Woodward v. Spear, 10 Vt. 420, 423, it was said that this aggrieved person must be some one having an interest in the estate. This phrase, by 1844, had been made an explicit requirement by incorporation in the statute (R.S. 1840, Chap. 44, § 28) and the Court's interpretation reaffirmed in Hemmenway v. Corey, 16 Vt. 225, 227.
Down through the years this Court has, from time to time, pointed out that an executor cannot, merely by virtue of his office, qualify as a "person interested" in the particular estate. Justice Watson, in In re Vincent's Estate, 84 Vt. 89, 90, 78 A. 714, put it clearly:
"The petition for the appeal shows the appellant's relation to the estate to be that of an executor simply. This relation neither gives him any legal right, nor places him under any legal liability, which may be enlarged or diminished by the decree of distribution. It follows that he has no such interest as is necessary by statute to the right of appeal (P.S. 2937), and the motion to dismiss should have been granted."
P.S. 2973 is now 12 V.S.A. § 2555. These words are almost a quotation of the language of Chief Justice Williams in the Hemmenway case sixty-seven years previously. This principle has been consistently adhered to down to the present and it now has been a part of our law for nearly a century and a quarter. E. g., Simonds v. Simonds' Estate, 96 Vt. 110, 111, 117 A. 103, 28 A.L.R. 420; Flory v. Flory's Estate, 98 Vt. 251, 253, 127 A. 369; Lyons, Exr. v. Field, 106 Vt. 474, 477, 175 A. 11; In re Manley Estate, 112 Vt. 314, 318, 24 A.2d 357; Will of Pynchon, 115 Vt. 57, 60, 50 A.2d 760.
This is not to say that a challenge to this rule is frivolous or unjustified. As so often happens, two sets of policy considerations are in competition here. The question is not one of right or wrong, but of an evaluation of the benefits and handicaps consequential on the adoption of one approach rather than another.
Many states have taken the position that there is a right and duty on the part of an executor to carry up an appeal to final review when the will has been disallowed. Since it is the function of the executor to present and defend the will on behalf of the testator, these courts find justification for a policy which allows the executor to appeal disallowance. Interestingly enough, this is usually accomplished by declaring that the executor does have a legal interest that qualifies him to act. See In re Will of Draheim, 267 Wis. 382, 66 N.W.2d 172.
Vermont has felt that the assets of estates might be jeopardized if executors who had no claim on those assets were allowed to litigate on appeal the disallowance of the instrument appointing them. So, we see on the one hand a policy directed toward defending the testator's will, and on the other a policy directed toward preserving his estate. In some instances, both policies are supported by a defining of "legal interest."
Undoubtedly there is something to be said on both sides. Furthermore, it is obviously salutary to review, from time to time, our position in this State on this matter, so that we do not cling to a policy rendered unjust and inapplicable by changing circumstances.
But, since the legislature, over the span of so many years, has acquiesced in the view this Court has taken of the rights of executors under the appeals statute, that view has become, in effect, part of the statute. In re Will of Prudenzano, 116 Vt. 55, 63, 68 A.2d 704. It is to the legislature that policy arguments for change should now be directed. For this Court to unexpectedly depart from the established understanding of the statutory meaning would be unwise and inappropriate.
Judgment dismissing the appeal is affirmed. Let the result be certified to the Probate Court for the District of Chittenden.
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636 P.2d 1335 (1981)
TRI-STATE GENERATION & TRANSMISSION ASSOCIATION, INC., Plaintiff-Appellant,
v.
The DEPARTMENT OF REVENUE of the State of Colorado, and Alan N. Charnes, Executive Director of the Department of Revenue of the State of Colorado, Defendants-Appellees.
No. 81CA0216.
Colorado Court of Appeals, Div. II.
October 29, 1981.
*1336 Holland & Hart, Bruce W. Sattler, John C. Siegesmund, III, Denver, for plaintiff-appellant.
J. D. MacFarlane, Atty. Gen., Richard F. Hennessey, Deputy Atty. Gen., Mary J. Mullarkey, Sol. Gen., Billy Shuman, Sp. Asst. Atty. Gen., Denver, for defendants-appellees.
KELLY, Judge.
Plaintiff, Tri-State Generation & Transmission Association, Inc. (Tri-State), contracted with the United States Bureau of Reclamation (United States) and two other utilities to construct and use a power transmission line between Hayden and Ault, Colorado. Defendant, Colorado Department of Revenue (Department), determined that, pursuant to § 39-26-202, C.R.S.1973, Tri-State was liable for use tax on items of tangible personal property used in the construction of the line. Tri-State claims it contracted only for a right to use the line and its payment of 36% of the construction cost represented the price of the lease, an intangible property right not subject to use tax. A trial de novo was held in the district court after the executive director of the Department decided that Tri-State was liable for the tax. Tri-State appeals the trial court's decision upholding the executive director's imposition of the tax, but does not dispute the amount of the tax. We affirm.
Tri-State is a non-profit utility engaged in purchasing, generating, and transmitting electricity to retail distributors in Nebraska, Wyoming, and Colorado. In 1975, Tri-State contracted with the United States, Platte River Power Authority (Platte River), and Colorado-Ute Electric Association, Inc., (Colorado-Ute) to construct a new power transmission line from Hayden to Ault, Colorado (Hayden-Ault line). The participants agreed that the United States would act as construction manager for part of the Hayden-Ault line and that Colorado-Ute would be the construction manager for another part of the project.
The contract specified that the United States and Colorado-Ute "shall own and have title to" the respective sections for which they acted as construction manager, but that "notwithstanding ownerships and titles, the Participants shall have Cost Responsibilities and Firm Capacity Entitlement [the right to future use] in the Hayden-Ault Addition" in certain stated percentages. The contract required the United States as title owner to grant Tri-State an "easement for the use and enjoyment of the facilities, including right-of-way ... to the extent of its Firm Capacity Entitlement therein."
Each participant was represented on an Engineering & Operating Committee, an Auditing Committee, and a Coordinating Committee which supervised the project. Tri-State advanced funds every month to cover construction costs in proportion to its share of the future use of the line, which was 36%. As construction manager, the United States caused this money to be spent on supplies and materials used to construct the line. The United States paid *1337 no sales or use tax on the materials. For the portion of the line constructed by the United States, Tri-State was required to insure against its share of any losses, and the United States was to cooperate with Tri-State in obtaining insurance.
The Department assessed a use tax against Tri-State for 36% of the materials used in constructing the Hayden-Ault line. The use tax statute provides:
"There is imposed and shall be collected from every person in this state a tax or excise for the privilege of storing, using, or consuming in this state any articles of tangible personal property purchased at retail." Section 39-26-202, C.R.S.1973.
Hence, the components of use tax liability are (1) tangible personal property (2) purchased at retail (3) without prior payment of sales or use tax and (4) use or consumption in Colorado. Fifteenth Street Investment Co. v. People, 102 Colo. 571, 81 P.2d 764 (1938).
Tri-State argues that it purchased only the intangible right to use the line until the year 2014, and that the price of that right was 36% of the construction cost. According to Tri-State, only the property owner can be liable for a use tax, and in the instant case, the United States owns the line and Tri-State merely leases part of it temporarily. Tri-State asserts that its membership on the committees which had veto power over the acquisition of materials was a mere "theoretical voice" which was never exercised, and that the setting of a contract price by reference to construction costs is not equivalent to ownership.
The Department correctly contends that use tax liability depends on use, not ownership. Tri-State's reliance on Denver v. Security Life & Accident Co., 173 Colo. 248, 477 P.2d 369 (1970), is misplaced because that case concerned an ad valorem tax on the "owner" of property, while § 39-26-202 assesses "every person" who uses property which has been purchased at retail. See J. A. Tobin Construction Co. v. Weed, 158 Colo. 430, 407 P.2d 350 (1965) (use tax obligation is on consumer).
In Fifteenth Street Investment Co. v. People, supra, a building owner resisted use tax on the components of an elevator installed by Otis Elevator Co. The court noted that "the owner ... who determines the nature and character of the structure ... is the one who ... uses all of the materials entering into the structure.... If the owner does the work himself, there can be no question ... as to who used the material. When he engages another to erect the structure ... the act of making the improvement is still his act.... Such materials as he puts into the work are used by the one directing and controlling it." Here, as in Fifteenth Street, Tri-State shared in the direction and control of the construction project and, therefore, "used" the materials for use tax purposes.
Even if ownership is a prerequisite of tax liability, Tri-State cannot characterize itself as a mere lessee when it contracted for the construction, use, operation, maintenance, and replacement of the line. Its veto power over acquisition of materials was an incident of ownership whether or not it was exercised, and monthly payment of on-going construction costs is more than a device for setting the price of the lease. Also, Tri-State was required to insure against loss of the materials, and the participants agreed to cooperate in constructing the line, using the United States and Colorado-Ute as their agents for the acquisition of materials.
The condition precedent to Tri-State's use of the line was its payment of 36% of the construction costs, which included the purchase of tangible personal property on which the United States paid no sales tax. Tri-State cannot escape use tax liability by making a private contract with the United States to act as a buyer of materials on its behalf.
The judgment is affirmed.
ENOCH, C. J., and VAN CISE, J., concur.
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386 F.3d 1033
UNITED STATES of America, Plaintiff-Appellee,v.Nevia Kevin ABRAHAM, Defendant-Appellant.
No. 03-14201. Non-Argument Calendar.
United States Court of Appeals, Eleventh Circuit.
September 30, 2004.
COPYRIGHT MATERIAL OMITTED Sheryl Joyce Lowenthal (Court-Appointed), Miami, FL, for Defendant-Appellant.
Lauren E. Fleischer, Anne R. Schultz, Asst. U.S. Atty., Kathleen M. Salyer, Miami, FL, for Plaintiff-Appellee.
Appeal from the United States District Court for the Southern District of Florida.
Before CARNES, BARKETT and HULL, Circuit Judges.
PER CURIAM:
1
Nevia Kevin Abraham appeals his life sentences for (1) conspiracy to kidnap a U.S. postal service employee, in violation of 18 U.S.C. § 1201(c); (2) kidnapping of a U.S. postal service employee, in violation of § 1201(a)(5); (3) use of a firearm during and in relation to a crime of violence, in violation of 18 U.S.C. § 924(c)(1) (two counts); (4) forcible assault of a U.S. postal service employee, in violation of 18 U.S.C. § 111(a),(b); and (5) possession of a firearm by a convicted felon, in violation of § 924(e)(1).
2
On January 31, 2003, Abraham kidnaped a U.S. postal worker, seeking to use her as a means to secure entry into his girlfriend's home. On appeal, Abraham makes seven arguments. First, he argues that the district court abused its discretion by denying Abraham's request for additional peremptory strikes during jury selection or, alternatively, by refusing to excuse for cause a juror who was a Postal Service employee. We review a district court's decision to strike a prospective juror for cause for abuse of discretion. United States v. Rhodes, 177 F.3d 963, 965 (11th Cir.1999). Abraham argues that it was inappropriate for the district court to seat a postal worker on the jury given the identity of the victim in this case. Abraham has failed to show, however, that the district court had any specific reason to conclude that the postal worker in question was incapable of impartially judging the defendant.
3
Second, Abraham argues that the district court abused its discretion by admitting evidence of Abraham's prior bad acts under Fed.R.Evid. 404(b). We review the district court's rulings on the admissibility of evidence for abuse of discretion. United States v. Thomas, 242 F.3d 1028, 1031 (11th Cir.2001). The district court admitted evidence that, on two occasions prior to the January 31 kidnaping, Abraham had used force and the threat of force against his girlfriend and her relatives. The evidence as to the first of these occasions indicated that, on January 17, 2003, Abraham pushed and choked his girlfriend in her home. As to the second, which took place on January 21, 2003, the evidence indicated that Abraham used a gun to threaten his girlfriend's mother and sister into helping him secure entry into his girlfriend's house. Abraham argues that the effect of this evidence was more prejudicial than probative. The government argues that the evidence of Abraham's prior bad acts was admissible, not to prove Abraham's character, but his motive, intent, or lack of mistake. We find that the district court's decision to admit the evidence was not an abuse of discretion.
4
Abraham's third argument is that the district court erred by not granting Abraham's motion for a mistrial following testimony attributing racist statements to Abraham. We review the district court's denial of a motion for a mistrial for abuse of discretion. United States v. Ettinger, 344 F.3d 1149, 1161 (11th Cir.2003). Here, too, we do not find that the trial court has committed an abuse of discretion in denying Abraham a mistrial, or that Abraham has made a showing of substantial prejudice sufficient to warrant a new trial. See id.
5
Fourth, Abraham argues that the prosecutor committed misconduct by misrepresenting the defendant's excuse and making inflammatory and prejudicial comments about the defendant to the jury. We will reverse a defendant's conviction for prosecutorial misconduct only if, "in the context of the entire trial in light of any curative instruction, the misconduct may have prejudiced the substantial rights of the accused." United States v. Bailey, 123 F.3d 1381, 1400 (11th Cir.1997). Where a defendant did not raise an issue below, our review is "limited to reviewing [the] claim[] of error for the first time on appeal under the plain error standard to avoid manifest injustice." United States v. Harness, 180 F.3d 1232, 1234 (11th Cir. 1999).1 Because Abraham did not raise his argument of prosecutorial misconduct below, we review this claim under the plain error standard. Abraham argues that during a post-arrest interrogation on January 31, he told an FBI agent and Miami-Dade police detectives that his girlfriend had threatened to kill their children and that he had acted out of concern for his children's safety. He further argues that the prosecution disingenuously suggested at trial that Abraham fabricated his defense theory sometime after his arrest. The government responds that Abraham's initial explanation was simply that he wanted to remove his children from his girlfriend, and that he added only later that he was concerned by an alleged threat to their safety. Moreover, the government points to testimony indicating that Abraham repeatedly forfeited opportunities to advise others that his girlfriend had threatened their children. In light of this testimony discrediting Abraham's defense, we find that Abraham has not made the requisite showing of a plain error that substantially affects his rights and that, if left uncorrected, would "seriously affect the fairness, integrity, or public reputation of a judicial proceeding." Humphrey, 164 F.3d at 588 & n. 3. Abraham also points to a prosecutorial statement about Abraham's use of a piece of paper to monitor the opening and closing of his girlfriend's apartment door, and to prosecutorial statements about his extramarital relationships and children. The government concedes that the first of these statements was not supported by record evidence but argues that the controlling and jealous behavior that it suggests is more than adequately justified by the record. The government also argues that it was defense counsel, not the prosecution, that first made an issue of Abraham's extramarital relationships, and that any prejudice that may have resulted was redressed by a curative instruction from the district court.2 Considered as a whole, we find that the statements in question were not sufficiently prejudicial to warrant a mistrial.
6
Fifth, Abraham argues that the district court erred by admitting into evidence the recording of a 911 call under the excited utterance exception to the hearsay rule. Because Abraham did not raise it below, we review this evidentiary claim under the plain error standard. The 911 call was made by the half-brother of Abraham's girlfriend, Melvin Dore, on January 21, 2003, when Abraham used a gun to threaten his girlfriend's mother and sister into helping him secure entry into his girlfriend's house. Dore had called to report that Abraham was abducting his mother and sister at gunpoint. Abraham argues that this recording was hearsay and that its admission into evidence violated Abraham's Sixth Amendment right to confront witnesses, given that Dore was available to testify. We find that the district court neither abused its discretion nor committed plain error in admitting the recording under the excited utterance exception to the hearsay rule.
7
Sixth, Abraham argues that his sentence was imposed in violation of the Ex Post Facto Clause. We review de novo a defendant's claim that his sentence was imposed in violation of the Ex Post Facto Clause. United States v. Futrell, 209 F.3d 1286, 1289 (11th Cir.2000). Because Abraham did not raise this claim below, we review it as well under the plain error standard. Abraham summarily argues that his sentence was imposed in violation of the Ex Post Facto Clause because the district court relied upon his prior escape conviction as a crime of violence in order to enhance his sentence under § 3559(c). Abraham contends that when he committed the crime of escape, "it was innocent and not a violent offense," and, by categorizing the offense as violent, the district court made the punishment for the crime of escape more burdensome than at the time of its commission.
8
"The ex post facto clause prohibits the enactment of statutes which . . . make more burdensome the punishment for a crime, after its commission. . . ." United States v. De La Mata, 266 F.3d 1275, 1286 (11th Cir.2001). We have explained that the following two elements must be present in order for a court to find an ex post facto violation: (1) the law must be retrospective, meaning it applies to events occurring before its enactment; and (2) the offender must be disadvantaged by it. United States v. Rosario-Delgado, 198 F.3d 1354, 1356 (11th Cir.1999) (citation omitted).
9
The federal "three strikes" law, which became effective on September 13, 1994, mandates a sentence of life imprisonment for a defendant who has been convicted of a "serious violent felony," if he previously was convicted of "one or more serious violent felonies and one or more serious drug offenses." 18 U.S.C. § 3559(c)(1)(A)(ii); Rosario-Delgado, 198 F.3d at 1355 (relying upon the reasoning in Gryger v. Burke, 334 U.S. 728, 732, 68 S.Ct. 1256, 1258, 92 L.Ed. 1683 (1948)). Abraham does not dispute that he was previously convicted of a serious drug offense. Thus, the only question is whether Abraham's prior escape conviction qualifies as a "serious violent felony." It is not clear that Abraham has properly raised this issue on appeal, given that he does not actually cite to § 3559(c) nor to any precedents regarding the classification of escape as a serious violent felony. In his brief, Abraham states simply that "there is nothing inherently violent about the crime of escape," and that his escape involved merely walking away from a work detail, without the use of violence or the threat of violence. He further points out that the district court, in accepting the recommendation of the Presentence Investigation Report that Abraham's escape conviction qualifies as a serious violent felony, relied on a case, United States v. Gay, 251 F.3d 950, 952 (11th Cir.2001), that interpreted the U.S. Sentencing Guidelines, not § 3359. These assertions, while conclusory, suffice to raise the issue of whether Abraham's prior escape conviction qualifies as a serious violent felony. Accordingly, before addressing whether the use of a predicate felony to enhance a defendant's sentence violates the Ex Post Facto Clause, we consider the merits of Abraham's § 3559 argument.
10
The definition of a "serious violent felony" under § 3559 encompasses
11
any . . . offense punishable by a maximum term of imprisonment of 10 years or more that has as an element the use, attempted use, or threatened use of physical force against the person of another or that, by its nature, involves a substantial risk that physical force against the person of another may be used in the course of committing the offense.
12
18 U.S.C. § 3559(c)(2)(F)(ii). Abraham concedes that escape is a second-degree felony punishable by fifteen years of imprisonment under Florida law. This Court has not specifically determined whether escape meets the remaining criteria set forth in this definition. In Gay, however, we held that a prior escape conviction constitutes a "crime of violence" under the career offender provisions of the Sentencing Guidelines even where the defendant's escape involves merely walking away from a non-secure facility. Section 4B1.2(a)(ii) of the Sentencing Guidelines define a "crime of violence" to include any offense that "involves conduct that presents a serious potential risk of physical injury to another." In Gay, we noted that "a district court only may inquire into the conduct surrounding a conviction if ambiguities in the judgment make the crime of violence determination impossible from the face of the judgment itself." Gay, 251 F.3d at 955 (internal citation and quotation marks omitted). Because the offense of escape does not involve such ambiguities "and does present the potential risk of violence, even when it involves a `walk-away' from unsecured correctional facilities," we concluded that the escape conviction in Gay constituted a "crime of violence" under the career offender guideline. Id.
13
There is no meaningful distinction between the language of the career offender guideline — which refers to conduct that "presents a serious potential risk of physical injury to another" — and the language of § 3559 — which refers to conduct that "involves a substantial risk that physical force against the person of another may be used." Under the reasoning of Gay and the language of § 3559, accordingly, we find that Abraham's prior escape conviction qualifies as a "serious violent felony."
14
We have held that the use of predicate felonies to enhance a defendant's sentence does not violate the Ex Post Facto Clause because such enhancements do not represent additional penalties for earlier crimes, but rather stiffen the penalty for the latest crime committed by the defendant. United States v. Reynolds, 215 F.3d 1210, 1213 (11th Cir.2000) (involving application of the Armed Career Criminal Act, 18 U.S.C. § 924(e), and corresponding sentencing guideline, U.S.S.G. § 4B1.4).
15
Because predicate felonies may be used to enhance a defendant's sentence without violating the Ex Post Facto Clause, and because Abraham has been convicted of "one or more serious violent felonies and one or more serious drug offenses," the district court did not plainly err by sentencing Abraham to a mandatory term of life imprisonment under § 3559.
16
Abraham's last argument is that the district erred by denying Abraham a reduction for acceptance of responsibility and by enhancing his sentence because the victim was a government employee. With respect to these sentencing claims, we review the district court's findings of fact for clear error and its application of the Sentencing Guidelines de novo. United States v. Rendon, 354 F.3d 1320, 1329 (11th Cir. 2003).
17
Abraham argues summarily that his sentence should be vacated and remanded for imposition of a new sentence reflecting a reduction for acceptance of responsibility and without a victim-related adjustment. Abraham includes a factual recitation of the objections that he presented to the district court, without specifically rearguing the merits of his claims or providing any relevant caselaw. Because Abraham is subject to a statutory mandatory life sentence under § 3559, his arguments pertaining to the Sentencing Guidelines will not affect the imposition of his sentence. As such, we need not address these issues.
18
Upon review of the record, and upon consideration of the briefs of the parties, we find no reversible error. Accordingly, we affirm Abraham's sentence.
19
AFFIRMED.
Notes:
1
Plain error requires (1) an error, (2) that is plain, (3) that affects the substantial rights of the defendant, and (4) that, if left uncorrected, would "seriously affect the fairness, integrity, or public reputation of a judicial proceeding."United States v. Humphrey, 164 F.3d 585, 588 & n. 3 (11th Cir.1999).
2
The government citesU.S. v. Wilson, 149 F.3d 1298, 1302 (11th Cir.1998) (finding that while prosecutor's comments were improper, defendant could not show prejudice in light of court's curative instruction and overwhelming evidence of guilt.)
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 18-7356
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
JOHN KENNEDY WILSON,
Defendant - Appellant.
Appeal from the United States District Court for the Eastern District of North Carolina, at
Raleigh. W. Earl Britt, Senior District Judge. (5:15-cr-00221-BR-2; 5:17-cv-00289-BR)
Submitted: January 17, 2019 Decided: January 23, 2019
Before WILKINSON and DUNCAN, Circuit Judges, and HAMILTON, Senior Circuit
Judge.
Dismissed by unpublished per curiam opinion.
John Kennedy Wilson, Appellant Pro Se.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
John Kennedy Wilson seeks to appeal the district court’s order denying relief on
his 28 U.S.C. § 2255 (2012) motion and has filed a motion for a certificate of
appealability. The order is not appealable unless a circuit justice or judge issues a
certificate of appealability. 28 U.S.C. § 2253(c)(1)(B) (2012). A certificate of
appealability will not issue absent “a substantial showing of the denial of a constitutional
right.” 28 U.S.C. § 2253(c)(2) (2012). When the district court denies relief on the
merits, a prisoner satisfies this standard by demonstrating that reasonable jurists would
find that the district court’s assessment of the constitutional claims is debatable or wrong.
Slack v. McDaniel, 529 U.S. 473, 484 (2000); see Miller-El v. Cockrell, 537 U.S. 322,
336-38 (2003). When the district court denies relief on procedural grounds, the prisoner
must demonstrate both that the dispositive procedural ruling is debatable, and that the
motion states a debatable claim of the denial of a constitutional right. Slack, 529 U.S. at
484-85.
We have independently reviewed the record and conclude that Wilson has not
made the requisite showing. Accordingly, we deny Wilson’s motion for a certificate of
appealability and dismiss the appeal. We dispense with oral argument because the facts
and legal contentions are adequately presented in the materials before this court and
argument would not aid the decisional process.
DISMISSED
2
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493 F.2d 1404
*dU. S.v.Gentile
73-3983
UNITED STATES COURT OF APPEALS Fifth Circuit
5/3/74
1
E.D.Tex.
2
AFFIRMED***
*
Summary Calendar case; Rule 18, 5 Cir.; see Isbell Enterprises, Inc. v. Citizens Casualty Co. of N
***
Opinion contains citation(s) or special notations
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NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS MAY 21 2018
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
JOSE ADAN VALENCIA-GAMEZ, No. 16-73440
Petitioner, Agency No. A206-802-253
v.
MEMORANDUM*
JEFFERSON B. SESSIONS III, Attorney
General,
Respondent.
On Petition for Review of an Order of the
Board of Immigration Appeals
Submitted May 15, 2018**
Before: SILVERMAN, BEA, and WATFORD, Circuit Judges.
Jose Adan Valencia-Gamez, a native and citizen of El Salvador, petitions for
review of the Board of Immigration Appeals’ order affirming an immigration
judge’s decision denying his application for asylum, withholding of removal, and
relief under the Convention against Torture (“CAT”). We have jurisdiction under
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
8 U.S.C. § 1252. We review for substantial evidence the agency’s factual findings,
Silaya v. Mukasey, 524 F.3d 1066, 1070 (9th Cir. 2008), and we deny the petition
for review.
Valencia-Gamez does not challenge the agency’s finding that he failed to
establish past persecution. Substantial evidence supports the agency’s
determination that Valencia-Gamez failed to establish that any harm he fears in El
Salvador would be on account of a protected ground. See Zetino v. Holder, 622
F.3d 1007, 1016 (9th Cir. 2010) (an applicant’s “desire to be free from harassment
by criminals motivated by theft or random violence by gang members bears no
nexus to a protected ground”). Thus, Valencia-Gamez’s asylum and withholding
of removal claims fail. See id.
Substantial evidence also supports the agency’s denial of CAT relief because
Valencia-Gamez failed to show it is more likely than not that he will be tortured
with the consent or acquiescence of the government of El Salvador. See Aden v.
Holder, 589 F.3d 1040, 1047 (9th Cir. 2009).
PETITION FOR REVIEW DENIED.
2 16-73440
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193 F.Supp. 701 (1959)
UPJOHN COMPANY, Plaintiff,
v.
LIBERTY DRUG CO., Inc., Defendant.
United States District Court S. D. New York.
May 11, 1959.
On Motion to Reargue June 18, 1959.
Rogers, Hoge & Hills, New York City, George M. Chapman, John A. Keeffe, New York City, of counsel, for plaintiff.
Friedman, Lipsig, Bernstein & Friedman, New York City, David Kaplan, New York City, of counsel, for defendant.
LEVET, District Judge.
This is a motion for a preliminary injunction to enjoin the defendant from advertising, *702 offering for sale or selling at retail merchandise bearing plaintiff's trademarks or brand names for prices less than those stipulated in plaintiff's fair trade contracts in effect with certain retailers in the State of New York.
The plaintiff is a manufacturer of ethical pharmaceuticals and other drug products, all of which bear the trademark, "Upjohn," together with individual product marks, including "Unicaps," "Zymacaps," "Zymadrops," "Kaopectate," "Cheracol" and "Cebenase."
The defendant is a retail drug store located at 126 Liberty Street, New York City. Though it has purchased substantial quantities of plaintiff's products in the past and is apparently continuing to do so, it has not signed a fair trade contract with the plaintiff.
In support of its motion, plaintiff alleges:
1. That for many years it has been engaged in an extensive advertising program, promoting its products to physicians, pharmacists and indirectly to ultimate consumers, as a result of which plaintiff has developed a vast good will.
2. That in the course of plaintiff's development and maintenance of its good will and system of distribution, it has established, wherever permitted by law, a fair trade structure under which uniform prices have been established for its products.
3. That such a fair trade structure was first established in the State of New York subsequent to the enactment of the New York Fair Trade Act in 1937.
4. That in order to assure itself that retailers are complying with its established resale prices, plaintiff investigates every infraction reported to or discovered by it and explains its fair trade program to retailers accused of violations thereof.
5. That plaintiff has an established policy of sending warning letters to retailers who persist in violations and of bringing suit where the retailers, after such warning, still refuse to stop their illegal conduct.
6. That in furtherance of its policy of enforcing its established minimum prices, plaintiff, in the past two years, has shopped every retailer in the Boroughs of Manhattan and Brooklyn who carried its products and that extensive investigations have also been conducted in the Bronx, Queens and Nassau Counties.
7. That more than thirty suits have been filed against retailers who have persisted in their unlawful price cutting and more than twenty permanent injunctions have been obtained.
8. That a warning against price violations was sent to the defendant on August 6, 1958, to no avail, and on November 19, 1958, action was commenced against the defendant seeking to enjoin its price cutting on plaintiff's products; however, defendant's price cutting is continuing.
9. That the defendant is a large retail drug establishment servicing the Wall Street area and employing at least thirty full-time employees; that its customers come from all over the City of New York and from the outlying suburban counties in both New York State and New Jersey, and consequently the defendant is competing with local retail druggists throughout the city and the surrounding suburban communities.
10. That the defendant's continued price cutting threatens to undermine plaintiff's fair trade price structure and is causing immediate and irreparable harm both to the good will and business of the plaintiff and to the good will and business of retailers who sell plaintiff's products at the fair trade price.
Defendant, in opposition to this motion, asserts that the plaintiff, by its own indifferent conduct, has encouraged and acquiesced in the wide-spread selling of its products at a competitive price; that plaintiff has neglected to take steps to prevent wide-spread price cutting of its products, and that as a result there has been a general collapse of plaintiff's fair trade price structure. In support of this contention, defendant has submitted affidavits *703 indicating twelve instances of sales of plaintiff's products below the fair trade price by retail druggists in Manhattan, Brooklyn and The Bronx. Eight of the sales took place in Manhattan; three in Brooklyn and one in The Bronx; five occurred in April 1959, five in February 1959 and two in January 1959.
The defendant further asserts that plaintiff has suffered no irreparable harm to its good will; that it has sold plaintiff's products below the fair trade price out of compelling economic necessity in order to meet the prevailing price of competitors; and that the granting of a preliminary injunction would cast a stigma on defendant's business reputation and give the plaintiff all of the relief to which it would be entitled only after prevailing at a trial of the disputed issues in this case.
As another basis for the denial of the relief here sought, the defendant contends that plaintiff is precluded from enforcing its fair trade price structure by reason of its sale at wholesale to the dispensaries of various industrial and public utility corporations. It appears that each of the dispensaries in question employs a full-time pharmacist, a registered nurse or a full or part-time physician and that each is engaged in servicing the health needs of company employees. There is not the slightest indication that these dispensaries are a mere subterfuge for the sale of plaintiff's products to ultimate consumers at less than the fair trade price or, indeed, that any such sales in fact occur.
Accordingly, the defendant's contention that the plaintiff is competing with it on the retail level is patently without merit. The case of United States v. McKesson & Robbins, Inc., 1956, 351 U. S. 305, 76 S.Ct. 937, 100 L.Ed. 1209, relied upon by defendant, has no applicability under the circumstances here presented.
After carefully considering the pleadings, plaintiff's motion papers and brief, defendant's opposing affidavits, the exhibits submitted on this motion and after hearing the oral argument of counsel, I have concluded that:
1. Plaintiff has made and is continuing to make reasonable and diligent efforts to enforce its fair trade price structure.
2. Despite certain violations, there has been no general breakdown of plaintiff's system of fair trade prices.
3. Defendant has and is continuing to sell plaintiff's products below the fair trade price in violation of Section 369-b of the New York General Business Law, McKinney's Consol. Laws, c. 20.
4. Defendant's continued disregard for plaintiff's rights under the New York Fair Trade Law is undermining plaintiff's fair trade price structure and unless restrained pending trial such conduct may lead to the destruction of plaintiff's fair trade system and the impairment of its good will.
5. The relief here sought against the defendant is for the sole purpose of enforcing plaintiff's fair trade rights.
6. There is no reason why a preliminary injunction should not be granted.
7. The plaintiff has established its right to a preliminary injunction since the defendant's acts are in clear violation of Section 369-b of the New York General Business Law, and unless restrained pending trial, such conduct will result in irreparable injury to plaintiff and may lead to the destruction of its fair trade structure and the impairment of its good will.
Settle order on notice which shall recite the facts as found herein and which shall provide that said order is conditioned upon plaintiff's furnishing a bond to the satisfaction of the court in the amount of $5,000.
On Motion to Reargue
The motion for leave to reargue is granted, and upon reargument the original determination of this court is adhered to for the reasons set forth in my *704 opinion dated May 11, 1959. The court has diversity of jurisdiction, jurisdiction over this action, and a sufficient jurisdictional amount is here involved. See John B. Kelly, Inc. v. Lehigh Nav. Coal Co., 3 Cir., 1945, 151 F.2d 743, 746, certiorari denied 327 U.S. 779, 66 S.Ct. 530, 90 L. Ed. 1007; Ambassador East, Inc. v. Orsatti, Inc., 3 Cir., 1958, 257 F.2d 79, 81; Board of Trade of City of Chicago v. Cella Commission Co., 8 Cir., 1906, 145 F. 28, 29. The other arguments by the defendant, in my opinion, lack merit.
So ordered.
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TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-03-00348-CV
Rehabilitation Management, Inc., Appellant
v.
Paragon Scientific Corporation, Appellee
FROM THE DISTRICT COURT OF TRAVIS COUNTY, 98TH JUDICIAL DISTRICT
NO. GN203978, HONORABLE SCOTT H. JENKINS, JUDGE PRESIDING
M E M O R A N D U M O P I N I O N
Appellant filed an unopposed motion to dismiss their appeal advising that the parties
have settled their dispute and appellant no longer desires to pursue this appeal.
The appeal is dismissed on motion of appellant. Tex. R. App. P. 42.1(a)(1), (2).
__________________________________________
Bea Ann Smith, Justice
Before Chief Justice Law, Justices B. A. Smith and Patterson
Dismissed on Appellant's Motion
Filed: October 9, 2003
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592 F.3d 805 (2010)
CUNNINGHAM CHARTER CORPORATION, Plaintiff-Respondent,
v.
LEARJET, INC., Defendant-Petitioner.
No. 09-8042.
United States Court of Appeals, Seventh Circuit.
Submitted November 13, 2009.
Decided January 22, 2010.
Ron A. Sprague, submitted, Gendry & Sprague, P.C., San Antonio, TX, for Defendant-Petitioner.
James F. Bennett, Dowd Bennett, Clayton, MO, for Plaintiff-Respondent.
Before POSNER, COFFEY, and FLAUM, Circuit Judges.
POSNER, Circuit Judge.
Cunningham Charter Corporation sued Learjet, Inc. in an Illinois state court asserting claims for breach of warranty and products liability on behalf of itself and all other buyers of Learjets who had received the same warranty from the manufacturer that Cunningham had received. The defendant removed the case to federal district court under the Class Action Fairness Act of 2005, 28 U.S.C. § 1332(d), and the plaintiff then moved to certify two classes. The district judge denied the motion on the ground that neither proposed class satisfied the criteria for certification set forth in Rule 23 of the Federal Rules of *806 Civil Procedure. The judge then ruled that the denial of class certification eliminated subject-matter jurisdiction under the Act, and so he remanded the case to the state court. Learjet petitioned for leave to appeal the order of remand. 28 U.S.C. § 1453(c). We granted the petition in order to resolve an issue under the Class Action Fairness Act that this court has not heretofore had to resolve.
The Act creates federal diversity jurisdiction over certain class actions in which at least one member of the class is a citizen of a different state from any defendant (that is, in which diversity may not be complete). 28 U.S.C. § 1332(d)(2). The Act defines class action as "any civil action filed under rule 23 of the Federal Rules of Civil Procedure or similar State statute or rule of judicial procedure authorizing an action to be brought by 1 or more representative persons as a class action." § 1332(d)(1)(B).
A later section says the Act applies "to any class action [within the Act's scope] before or after the entry of a class certification order." § 1332(d)(8). Probably all this means is that the defendant can wait until a class is certified before deciding whether to remove the case to federal court. If (d)(8) said "the" instead of "a" class certification order, it might be thought to imply that the Act was limited to cases in which such an order was eventually issued. But that would be inconsistent with (d)(1)(B), the section quoted above that defines class action as a suit filed under a statute or rule authorizing class actions, even though many such suits cannot be maintained as class actions because the judge refuses to certify a class. As actually worded, (d)(8), insofar as it relates to jurisdiction at all (it doesn't mention the word-the conferral of jurisdiction is limited to (d)(2)), implies at most an expectation that a class will or at least may be certified eventually. The absence of such an expectation could mean that the suit was not within the jurisdiction conferred by the Class Action Fairness Act that it wasn't really a class action. Frivolous attempts to invoke federal jurisdiction fail, and compel dismissal. If a plaintiff sued in state court a seller of fish tanks on behalf of himself and 1,000 goldfish for $5,000,001 and the defendant removed the case to federal district court, that court would have to dismiss the case, as it would have been certain from the outset of the litigation that no class could be certified.
Another section of the Act defines "class certification order" as "an order issued by a court approving the treatment of some or all aspects of a civil action as a class action." § 1332(d)(1)(C). Read in isolation from the rest of the Act, this could mean that in the absence of such an order a suit is not a class action. But remember that jurisdiction attaches when a suit is filed as a class action, and that invariably precedes certification. All that section 1332(d)(1)(C) means is that a suit filed as a class action cannot be maintained as one without an order certifying the class. That needn't imply that unless the class is certified the court loses jurisdiction of the case.
We assumed in Bullard v. Burlington Northern Santa Fe Ry., 535 F.3d 759, 762 (7th Cir.2008), that federal jurisdiction under the Class Action Fairness Act does not depend on certification, and we now join Vega v. T-Mobile USA, Inc., 564 F.3d 1256, 1268 n. 12 (11th Cir.2009), in so holding. Cf. In re TJX Companies Retail Security Breach Litigation, 564 F.3d 489, 492-93 (1st Cir.2009). That is the better interpretation, see G. Shaun Richardson, "Class Dismissed, Now What? Exploring the Exercise of CAFA Jurisdiction After the Denial of Class Certification," 39 New Mex. L.Rev. 121, 135 (2009); Kevin M. Clermont, "Jurisdictional Fact," 91 Cornell L.Rev. 973, 1015-17 (2006) and not only *807 as a matter of semantics. For if a state happened to have different criteria for certifying a class from those of Rule 23, the result of a remand because of the federal court's refusal to certify the class could be that the case would continue as a class action in state court. That result would be contrary to the Act's purpose of relaxing the requirement of complete diversity of citizenship so that class actions involving incomplete diversity can be litigated in federal court.
Our conclusion vindicates the general principle that jurisdiction once properly invoked is not lost by developments after a suit is filed, such as a change in the state of which a party is a citizen that destroys diversity. E.g., St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 293-95, 58 S.Ct. 586, 82 L.Ed. 845 (1938); In re Shell Oil Co., 970 F.2d 355 (7th Cir.1992) (per curiam). The general principle is applicable to this case because no one suggests that a class action must be certified before it can be removed to federal court under the Act; section 1332(d)(8) scotches any such inference.
There are, it is true, exceptions to the principle that once jurisdiction, always jurisdiction, notably where a case becomes moot in the course of the litigation. See Church of Scientology v. United States, 506 U.S. 9, 12, 113 S.Ct. 447, 121 L.Ed.2d 313 (1992); Walters v. Edgar, 163 F.3d 430, 432 (7th Cir.1998). Or, if the plaintiff amends away jurisdiction in a subsequent pleading, the case must be dismissed. Rockwell Int'l Corp. v. United States, 549 U.S. 457, 473-74, 127 S.Ct. 1397, 167 L.Ed.2d 190 (2007). And likewise if after the case is filed it is discovered that there was no jurisdiction at the outset, id. at 473, 127 S.Ct. 1397 not that this is really an exception to the principle that jurisdiction, once it attaches, sticks; it is a case in which there never was federal jurisdiction.
These points are applicable to the Class Action Fairness Act, Clermont, supra, 91 Cornell L.Rev. at 1016-17, but inapplicable to the present case. Although the district court found "a number of fatal flaws" in the plaintiff's motion for class certification, they are not so obviously fatal as to make the plaintiff's attempt to maintain the suit as a class action frivolous. Behind the principle that jurisdiction once obtained normally is secure is a desire to minimize expense and delay. If at all possible, therefore, a case should stay in the system that first acquired jurisdiction. It should not be shunted between court systems; litigation is not ping-pong. (This consideration cuts against the proposal in Richardson, supra, 39 New Mex. L.Rev. at 141-47, that having declined to certify a class the federal court should abstain in favor of the state courts; that would be the equivalent of returning the case to the state court in which it had originated.) An even more important consideration is that the policy behind the Class Action Fairness Act would be thwarted if because of a remand a suit that was within the scope of the Act by virtue of having been filed as a class action ended up being litigated as a class action in state court.
The judgment of the district court is reversed and the case remanded to that court for further proceedings consistent with this opinion.
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284 F.2d 592
Warren O. WILDEBLOOD, Petitioner,v.UNITED STATES of America, Respondent.
Misc. No. 1456.
United States Court of Appeals District of Columbia Circuit.
November 3, 1960.
Petition for Rehearing En Banc Denied November 29, 1960.
On Petition for leave to appeal from the Municipal Court of Appeals in Forma Pauperis.
See, also, 106 U.S.App.D.C. 338, 273 F.2d 73.
Mr. John B. Jones, Jr., Washington, D. C. (appointed by this court) was on the petition for leave to appeal in forma pauperis.
Messrs. Oliver Gasch, U. S. Atty., and Carl W. Belcher, and John D. Lane, Asst. U. S. Attys., were on respondent's opposition to the petition.
Before EDGERTON, BASTIAN and BURGER, Circuit Judges, in Chambers.
PER CURIAM.
1
Upon consideration of the petition for leave to prosecute an appeal from the Municipal Court of Appeals without prepayment of costs and of the memoranda in support and in opposition, it is
2
Ordered by the court that the petition for leave to prosecute an appeal from the Municipal Court of Appeals without prepayment of costs is denied.
3
EDGERTON, Circuit Judge (dissenting).
4
"Any party aggrieved by any final order or judgment of The Municipal Court for the District of Columbia * * * may appeal therefrom as of right to The Municipal Court of Appeals for the District of Columbia * * * Provided, however, That reviews of judgments of the small claims and conciliation branch of the Municipal Court of the District of Columbia, and reviews of judgments in the criminal branch of the court where the penalty imposed is less than $50, shall be by application for the allowance of an appeal, filed in said Municipal Court of Appeals. * * *" D.C.Code (1951) § 11-772(a).
5
The underlying principle of the statute is clear. Appeal is a matter of right in serious cases.
6
This is a serious case. It involves "grave moral turpitude and an indelible stigma". Wildeblood v. United States, 106 U.S.App.D.C. 338, 339, 273 F.2d 73, 74. It is therefore within the principle of the statute.
7
The question is whether it is nevertheless outside the language of the statute. I think it is within the language as well as the principle. The sentence imposed upon the petitioner was "$25.00 or 10 days". In my opinion this is not a "penalty * * * less than $50" and petitioner was therefore entitled to appeal as of right. As in previous cases, the Municipal Court of Appeals has held the contrary.
8
The question is of general importance and this court should decide it because it constantly recurs. Petitioner's poverty should not prevent us from deciding it. I would therefore grant the petition for leave to appeal in forma pauperis.
9
The nature of the penalty actually inflicted by a sentence of "$25.00 or 10 days" depends on the defendant's financial ability and personal choice. If he chooses, and is able, to pay the fine, he can avoid imprisonment. If he chooses imprisonment, he can avoid the fine. If he cannot pay the fine, he cannot avoid imprisonment.
10
No one suggests that imprisonment for 10 days is a "penalty * * * less than $50." The theory of the Municipal Court of Appeals is that although "10 days" was part of the sentence, that part of the sentence was no part of the penalty. This seems to me a paradox. The Municipal Court of Appeals has said in defense of its theory: "The alternative of imprisonment is but the mode, authorized by Section 11-616 of the Code, for enforcing payment of the fine imposed, and may be avoided by payment of the fine." Yeager v. District of Columbia, 33 A.2d 629, 630. This overlooks three things. (1) In many cases, imprisonment cannot "be avoided by payment of the fine" because the defendant cannot pay the fine. (2) Payment of the fine can always be avoided by going to prison. (3) Section 11-616 of the District of Columbia Code does not authorize alternative sentences of fine or imprisonment. It provides that "in all cases where the said court shall impose a fine it may, in default of the payment of the fine imposed, commit the defendant for such a term as the court thinks right and proper, not to exceed one year." (Emphasis added.) That is not what the Municipal Court did in petitioner's case. If it was authorized to impose the alternative sentences it did impose, it derived its authority not from § 11-616 but from § 22-2701. Section 22-2701 authorizes, for the offense involved in this case, "a penalty of not more than $250 or imprisonment for not more than ninety days or both." Since this section deals with the penalty of imprisonment and the penalty of a fine in exactly the same way, and the Municipal Court imposed the penalty of imprisonment and the penalty of a fine in exactly the same way, each is as much "the penalty imposed" as the other. Because "10 days" is not a "penalty * * * less than $50", the "penalty imposed" is not "less than $50".
11
It is clear and undisputed that petitioner's payment of the fine in order to avoid the imprisonment does not moot the case.1
12
Because petitioner was not imprisoned, this case does not involve the "question whether an alternative sentence of fine or imprisonment is an invalid discrimination between those who are able to pay and those who are not."2 When the person sentenced cannot pay the fine and is therefore imprisoned, the constitutional question arises. The answer seems clear. The cases on which the court relies were decided many years ago,3 and the constitutional question does not appear to have been raised. More recently, the Supreme Court has repeatedly held that "invidious discriminations" in the administration of criminal justice are unconstitutional. Griffin v. Illinois, 1956, 351 U.S. 12, 17, 76 S.Ct. 585, 100 L.Ed. 891; Eskridge v. Washington Prison Board, 1958, 357 U.S. 214, 78 S.Ct. 1061, 2 L.Ed.2d 1269; Burns v. Ohio, 1959, 360 U.S. 252, 79 S.Ct. 1164, 3 L.Ed.2d 1209. Specifically, the Court has held that "There can be no equal justice where the kind of trial a man gets depends on the amount of money he has." Griffin v. Illinois, 351 U.S. 12, 19, 76 S.Ct. 585, 100 L. Ed. 891. Few would care to say there can be equal justice where the kind of punishment a man gets depends on the amount of money he has. That this continues to happen in the fifth year of the Griffin era does not imply that it could withstand appellate review. It escapes review. A defendant who goes to jail because he cannot pay a fine seldom has the means to appeal. And appeals from these short sentences would become moot before they could be decided. Cf. Thompson v. Louisville, 362 U.S. 199, 202, 80 S.Ct. 624, 4 L.Ed.2d 654.
Notes:
1
District of Columbia v. Gardiner, 39 App.D.C. 389; Hartwell v. United States, 5th Cir., 107 F.2d 359. The contrary decision of the Municipal Court of Appeals (Cayton, J., dissenting) in Hanback v. District of Columbia, 35 A.2d 189, is erroneous
A paid fine, unlike a served sentence, may be remitted. And "payment of the fine in accordance with the sentence was not a consent to the sentence, but a payment under duress." Holmes, J., in Commonwealth v. Fleckner, 167 Mass. 13, 44 N.E. 1053.
2
Statement of Judge Bazelon, filed Sept. 29, 1958, in connection with the allowance of an appeal from the Municipal Court of Appeals in Clarke v. United States, 1959, 105 U.S.App.D.C. 19, 263 F.2d 269
3
Ex parte Jackson, 1877, 96 U.S. 727, 24 L.Ed. 877; Bowles v. District of Columbia, 1903, 22 App.D.C. 321; Hill v. Wampler, 1936, 298 U.S. 460, 56 S.Ct. 760, 80 L.Ed. 1283; Yeager v. District of Columbia, D.C.Mun.App.1943, 33 A. 2d 629
Memorandum in Response to Dissent
13
BASTIAN, Circuit Judge, with whom BURGER, Circuit Judge, joins.
14
In order that our position with respect to the order entered this day may be clear, and made of record, this memorandum is written to accompany the dissenting opinion of Judge Edgerton.
15
Wildeblood was tried and found guilty by the Municipal Court, sitting without a jury, of the offense of soliciting for lewd and immoral purposes. § 22-2701, D.C. Code (1951). He was sentenced to pay a fine of $25.00 or, in lieu thereof, to serve ten days in jail. § 11-616, D.C.Code (1951). He promptly paid the fine, so no question as to petitioner's "poverty" is involved, as Judge Edgerton seems to indicate. Petitioner sought no stay of the sentence pending appeal.
16
Thereafter, Wildeblood filed a petition for allowance of an appeal in the Municipay Court of Appeals. Acting in accordance with its discretion under § 11-772 of the Code,1 which makes the allowance of criminal appeal discretionary in cases where penalties less than $50.00 are imposed, that court denied the appeal. As will be seen from the quoted section of the Code, note 1, supra, where appeal has been denied by the unanimous action of the three judges of the Municipal Court of Appeals "there shall be no further appeal." Nevertheless, Wildeblood petitioned this court for review.
17
Without reaching the question of jurisdiction to entertain the appeal, we remanded the case to the Municipal Court of Appeals, in essence holding that in cases such as this, involving grave moral turpitude and stigma, the Municipal Court of Appeals should appoint counsel to represent an indigent before proceeding on the merits of the application for appeal. We remanded to appoint counsel and to reconsider the disallowance of the appeal. Wildeblood v. United States, 1959, 106 U.S.App.D.C. 338, 273 F.2d 73.
18
The Municipal Court of Appeals duly complied with our mandate, permitted petitioner to file an amended application for allowance of appeal, appointed new counsel for appellant,2 and required that a statement of proceedings and evidence be certified, to aid that court in ruling on the amended application. In compliance with the order, a trial transcript was filed by the court reporter. Prior to the filing of the transcript, an amended application for allowance of appeal had been filed, to which was appended a statement of law, points and authorities. On March 31, 1960, the application for discretionary appeal was denied, the court entering an order reciting their actions on the remand, and reading in part as follows:
19
"The Chief Judge and the two Associate Judges of this court, having carefully considered the entire record, including the amended application, the transcript and the points and authorities of both counsel, and each of the judges being of the opinion that the appeal should be denied, it is "Ordered that the application be and the same is hereby denied in accordance with Code 1951, 11-772."
20
When the matter again came before us, a majority voted to deny the petition for review of the action of the Municipal Court of Appeals in denying the appeal. Judge Edgerton dissented and filed a memorandum in which several points are raised, one among them being that petitioner's payment of the fine in order to avoid imprisonment did not moot the case. The majority made no such holding. In the view that we take, it was not and is not necessary to reach or pass on that point. We held simply that this is not a case in which we elect to exercise our discretionary power to review an action of the Municipal Court of Appeals. It is, in short, a denial of certiorari.
21
Our dissenting colleague states that "petitioner's sentence of $25.00 or 10 days was not a `penalty * * * less than $50,'" and, therefore, that petitioner is entitled to appeal as a matter of right. The sentence in this case meant that, if petitioner did not pay the fine of $25.00, he would be imprisoned for a period of 10 days. That he was able to pay the fine is shown by the fact that it was immediately paid.
22
The heavy burden of cases in this court made necessary the establishment of the Municipal Court of Appeals, with right to come to this court only on petition of writ of error. The legislative history of the Act establishing the Municipal Court and the Municipal Court of Appeals, and the reasons back of the adoption of § 11-772 of the Code, are found in the Reports of the House and Senate Committees.3 From these, it appears that it was determined that the Municipal Court of Appeals should consider all appeals as a matter of right where imprisonment is the penalty imposed; but, in the case of a fine, that that court need consider only the appeals in those cases where the fine exceeds $50.00. This provision was attached to that part of the Act which allows appeals in civil matters as a matter of right where the amount involved is $50.00 or more. To make it abundantly clear that the Municipal Court of Appeals is not obliged to take jurisdiction of cases where the penalty imposed is less than $50.00, Congress stated specifically that the appeal shall be denied if all three judges of the court are of that opinion, but, if they or any one of them believe that jurisdiction should be taken, then the appeal to that court shall be granted.
23
In the instant case, the Municipal Court of Appeals has twice considered the matter. Our remand in the case in the first instance was not in any sense a direction to that court to take jurisdiction of the appeal but was simply a direction that it should afford counsel before passing on the question, in order that the rights of petitioner might be adequately protected. On the remand, the Municipal Court of Appeals not only reconsidered the matter but also received and reviewed a copy of the trial transcript; and, after consideration by all three judges, all were of the opinion that the appeal should be denied. There is nothing in the record to warrant our disturbing that finding or taking the case.
24
It is perfectly obvious that if the appeal in this case were to be allowed as a matter of right, it would mean that § 11-772 would be rendered nugatory. In practically every criminal case before it resulting in a conviction where the Municipal Court orders a fine, it adds the provision for a jail term on failure to pay the fine. If the view of our dissenting colleague were to be adopted, the practical result would be that appeal may be taken in every case as a matter of right. This we do not believe was the intent of Congress. § 11-616 of the Code reads:
25
"Prosecutions — Jury trials — Default of fines — Penalty.
26
"Prosecutions in the police court shall be on information by the proper prosecuting officer. In all prosecutions within the jurisdiction of said court in which, according to the Constitution of the United States, the accused would be entitled to a jury trial, the trial shall be by jury, unless the accused shall in open court expressly waive such trial by jury and request to be tried by the judge, in which case the trial shall be by such judge, and the judgment and sentence shall have the same force and effect in all respects as if the same had been entered and pronounced upon the verdict of a jury.
27
"In all cases where the accused would not by force of the Constitution of the United States be entitled to a trial by jury, the trial shall be by the court without a jury, unless in such of said last-named cases wherein the fine or penalty may be more than $300, or imprisonment as punishment for the offense may be more than ninety days, the accused shall demand a trial by jury, in which case the trial shall be by jury. In all cases where the said court shall impose a fine it may, in default of the payment of the fine imposed, commit the defendant for such a term as the court thinks right and proper, not to exceed one year."
28
This section [then Section 44, D.C. Code, 1901]4 was before this court in Bowles v. District of Columbia, 22 App. D.C. 321, where substantially the same contention was made as is set forth in our dissenting colleague's opinion. There the defendant had been charged with violation of a municipal ordinance for which the maximum penalty was $40.00. His demand for a jury trial as a matter of right was refused. He was tried, found guilty and adjudged to pay a fine of $25.00 and, in default of payment, to be committed to the workhouse for sixty days. It was contended that what is now § 11-616 of the Code, under consideration there (and here), required the grant of a jury trial since, although the maximum penalty for the offense was a fine of $40.00, the Act also provided for the sentence of an imprisonment which might last for more than thirty days as a punishment. It was argued that this provided for alternative punishment by imprisonment for thirty days or more and therefore entitled the defendant to a jury trial. The court said:
29
"The vice of this argument is so patent that it requires no great amount of consideration. If it were well founded, every violation of a municipal ordinance would have to be tried by a jury; for it would always be in the power of the accused to refuse to pay a fine imposed, and thereby to force an imprisonment, if the municipal ordinance is not to become a nullity and a mockery. The result of such a contention as this, if established, it is unnecessary to describe. It must suffice to say that, under such a construction of the law, which would practically allow a party to take advantage of his own wrong, municipal ordinances would become worthless and municipal chaos would take the place of law and order. The condition which would be superinduced would be intolerable." Id. at pages 327-328.
The court then continued:
30
"But plainly the law means nothing of this kind. Imprisonment is not provided either by the ordinance or by the Code as an alternative punishment; but imprisonment is very properly provided as the only available mode for the enforcement of the fines imposed as punishment. Without it there would be no practicable means for the enforcement of fines. When imprisonment is provided as an alternative punishment, it is proper so to state, and it is so stated in the laws and ordinances. Imprisonment could not be imposed in this case primarily; and it is always competent for the party to avoid it by paying his fine. It would not be competent for him to avoid it if it were originally imposed as punishment." Id. at page 328.
31
Bowles was followed and relied on by the Municipal Court of Appeals in the case of Yeager v. District of Columbia, 33 A.2d 629, which is criticized by our dissenting colleague; however, we adhere to the ruling laid down in Bowles.
32
In addition, it is of interest to note that in the case of Ex parte Jackson, 96 U.S. 727, 24 L.Ed. 877, the Supreme Court held that when a party is convicted of an offense and sentenced to pay a fine, it is within the discretion of the court to order his imprisonment until the fine shall be paid. And, to the same effect, see Hill v. Wampler, 298 U.S. 460, 56 S. Ct. 760, 80 L.Ed. 1283, in which the Supreme Court said:
33
"The payment of a fine imposed by a court of the United States in a criminal prosecution may be enforced by execution against property in like manner as in civil cases * *. In the discretion of the court the judgment may direct also that the defendant shall be imprisoned until the fine is paid * * *. If the direction for imprisonment is omitted, the remedy by execution is exclusive. Imprisonment does not follow automatically upon a showing of default in payment. It follows, if at all, because the consequence has been prescribed in the imposition of the sentence. The choice of pains and penalties, when choice is committed to the discretion of the court, is part of the judicial function. This being so, it must have expression in the sentence, and the sentence is the judgment." Id. at pages 463-464, 56 S.Ct. at page 762.
34
We do not think these cases are overruled by Griffin v. Illinois, 331 U.S. 12, 76 S.Ct. 585, 100 L.Ed. 891, as is suggested by Judge Edgerton.
35
Finally, it is contended by petitioner that he should have appellate consideration of the question of whether his conviction is consistent with the great caution with which uncorroborated testimony to an invitation to sodomy should be received, citing Kelly v. United States, 1952, 90 U.S.App.D.C. 125, 194 F.2d 150. We adhere, of course, to the rule in Kelly, and the short answer is that there was ample corroboration in the instant case.
36
Officer Vaughan, a detective in plain clothes, and the petitioner were strangers. They were observed in conversation late at night at a bus terminal. Thereafter, they walked some four or five blocks to the outside of petitioner's basement apartment, where the arrest was made after Officer Vaughan had identified himself as a police officer. While it is true that only Officer Vaughan testified as to the solicitation, Police Officer Boyd, who had witnessed the whole affair, although not near enough to the two to hear their conversation, followed them from the bus terminal to petitioner's apartment and he too identified himself. It is significant that, when the Government attempted to ascertain what conversation took place upon Officer Boyd's arrival on the scene, the petitioner objected.5 The trial court then recognized and applied the ruling in Kelly.
37
Reading the order denying the application for leave to appeal entered on the unanimous action of the three judges of the Municipal Court of Appeals, who have twice considered whether to take this case, and the statement of that court quoted above, we see no basis consistent with the statute on which we should direct the Municipal Court of Appeals to take the case. To do so would completely frustrate the intent of Congress in the enactment of § 11-772.
38
We think we should add that petitioner's counsel urges that the Municipal Court of Appeals should allow appeals in all disputed convictions (no matter what the penalty) for crimes involving moral turpitude. We decline to impose such an obligation on that court. This would mean reading into the statute something that is not there, and the rewriting of any statute is a constitutional function of the legislative branch.
Notes:
1
The pertinent part of § 11-772 provides as follows:
"Right to appeal — Final order or judgment * * *.
"(a) Any party aggrieved by any final order or judgment of The Municipal Court for the District of Columbia * * may appeal therefrom as of right to The Municipal Court of Appeals for the District of Columbia. * * * Provided, however, That reviews of judgments * * * in the criminal branch of the court where the penalty imposed is less than $50, shall be by application for the allowance of an appeal, filed in said Municipal Court of Appeals * * *. When the appealing party is not represented by counsel, it shall be the duty of the clerk to prepare the application in his behalf. The application for appeal shall be filed in The Municipal Court of Appeals for the District of Columbia within three days from the date of judgment. It shall be promptly presented by the clerk to the chief judge and to each of the associate judges for their consideration. If they or any one of them are of the opinion that the appeal should be allowed, the appeal shall be recorded as granted, and the case set down for hearing on appeal, and given a preferred status on the calendar, and heard in the same manner as other appeals in said court. If the chief judge and both associate judges shall be of the opinion that an appeal should be denied, such denial shall stand as an affirmance of the judgment of the trial court, from which there shall be no further appeal. [Emphasis added.]
"After the effective date of this subchapter, no writs of error or appeals, except in respect of judgments theretofore rendered, shall be granted by the United States Court of Appeals for the District of Columbia to the said Municipal Court * * *."
2
The Municipal Court of Appeals requested counsel appointed by this court to represent appellant in that court, but that counsel "for good and sufficient reasons" asked to be relieved from further service in the matter
3
H.R.Rep. No. 5784, 77th Cong., 1st Sess. (1941); H.R.Rep. No. 1236, S.Rep. No. 1116, 77th Cong., 2d Sess. (1942); 88 Cong.Rec. 1838, 2817, 2981 (1942)
4
Section 44 of the D.C.Code, 1901, is the same as present § 11-616 except that the Act of March 3, 1925, amended the second paragraph by changing the words "fifty dollars or more" to "more than three hundred dollars," and the words "thirty days or more" to "more than ninety days."
5
For some reason, the trial court sustained petitioner's objection
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92 N.W.2d 638 (1958)
BEANE PLUMBING & HEATING COMPANY, Appellee,
v.
D-X SUNRAY OIL COMPANY, Appellant,
Charles Ellis Bourrett, d/b/a Bourrett Tin & Furnace Shop, Appellee,
Fullerton Lumber Company, Appellee,
Haakinson & Beaty Company, Appellee,
Hooker Glass & Paint Mfg. Company, Appellee,
C. E. Hardy, Appellee,
Mellon National Bank and Trust Company, Pittsburgh, Pennsylvania, Appellee,
Cardinal Service Stations, Incorporated, Appellee.
No. 49515.
Supreme Court of Iowa.
October 14, 1958.
*640 J. P. Greve and R. S. Roberts, Tulsa, Okl., and Corbett & Corbett, Sioux City, for appellant.
Goldberg & Nymann, Sioux City, for Beane Plumbing & Heating Co., appellee.
Spencer M. Day, Sioux City, for C. E. Hardy, appellee.
J. P. Greve, Tulsa, Okl., for Mellon Nat. Bank and Trust Co., Pittsburgh, Pa., and Cardinal Service Stations, Inc., appellees.
Shull, Marshall, Mayne, Marks & Vizintos, Sioux City, for Fullerton Lumber Co. and Haakinson & Beaty Co., appellees.
Hutchinson, Hurst & Duggan, Sioux City, for Charles Ellis Bourrett doing business as Bourrett Tin & Furnace Shop, appellee.
Corbett & Corbett, Sioux City, for Hooker Glass & Paint Mfg. Co., appellee.
PETERSON, Justice.
On March 25, 1955, appellant's predecessor in interest, Mid-Continent Petroleum Corporation, entered into a written agreement with Bride Construction Company of Sioux City for erection of a service station upon property in Sioux City hereafter described, and later acquired by appellant. Appellant assumed all obligations of the agreement. The contract price was $22,904. The construction of the station was completed in October 1955.
Prior to January 1, 1956 appellant paid Bride Construction Company $19,462 on the contract price, leaving unpaid the sum of $3,442.
Bride Construction Company failed to pay several subcontractors. Most of them are appellees herein. The subcontractors filed liens, but not within sixty days from the completion of their work. Consequently, their liens would only attach as against appellant's property to the extent of any unpaid balance under the contract. Sections 572.10 and 572.11, 1954 Iowa Code, I.C.A.
The liens were filed on the dates stated, and in following amounts: Charles Ellis Bourrett, March 30, 1956, $1231; Beane Plumbing & Heating Company, April 10, 1956, $646; Hooker Glass & Paint Mfg. Company, May 3, 1956, $610; C. E. Hardy, May 17, 1956, as a subcontractor $557; as a principal contractor for some extra work $412.30. All above named subcontractors gave written notice to appellant as to filing of the liens, as provided by statute.
September 4, 1956, plaintiff filed petition for foreclosure of his mechanic's lien. September 24, 1956, C. E. Hardy filed petition for foreclosure of his mechanic's lien. Charles Ellis Bourrett and Hooker Glass & Paint Manufacturing Company filed answers and cross-petitions in one or both of the cases for foreclosure of their mechanic's liens. Appellant filed answer and cross-petition to quiet title against all adverse parties. Under Order of Court the two mechanic's lien cases were consolidated for trial. The issues raised by the answering defendants and cross-petitioners were also consolidated for trial, in order that all issues *641 as between the various mechanic's lien holders and appellant could be, and were, tried in one case.
On February 15, 1956, the Internal Revenue Department of the United States made an assessment for social security, unemployment, etc., taxes against Bride Construction Company in the amount of $3,361.33. May 4, 1956, the Director served notice of levy on appellant to enforce payment of the assessment. Neither the United States of America nor the Revenue Department were served with notice in these cases. They never filed pleadings nor entered appearance.
On July 21, 1955, appellant entered into written contract with Bride Construction Company for the erection of a service station at Logan, Iowa. The contract price was $24,295. The construction company did not fully complete the contract and in November 1955 appellant expended the sum of $863.77 in completing the station. Prior to that time appellant had paid the contractor $18,090. Deducting these two items from the contract price leaves $5,939.23, that appellant still owed Bride Construction Company. However, within the sixty day period for filing subcontractors' liens three liens were filed totaling $10,284.59. If appellant will ultimately have to pay these liens, Bride Construction Company will owe $5,345.36 to appellant. It is the theory of appellant that this item more than offsets the $3,442 unpaid on the contract at Sioux City, and therefore there is no balance subject to appellees' liens.
The decree of the trial court held the Logan matter did not enter into the situation and that there was unpaid on the contract for erection of the Sioux City station the sum of $3,442. The court established costs and mechanic's liens as against the real estate of appellant in following order and amounts: First: costs of the proceeding. Second: Claim of Charles Ellis Bourrett for $1,231. Third: Claim of Beane Plumbing & Heating Company for $646. Fourth: Claim or lien of the United States, if and when the same is established. Fifth: Claim of Hooker Glass & Paint Manufacturing Company for $610. Sixth: Claim of C. E. Hardy for $557 as a subcontractor. The court also held Hardy was a principal contractor as to $412.30, and foreclosed lien as to said amount directly against appellant.
Fullerton Lumber Company, The Hawkinson & Beaty Company, and Thermoflector Corporation also filed mechanic's liens. Thermoflector Corporation was never served with a notice and never became a party to the action. Fullerton Lumber Company and The Hawkinson & Beaty Company never gave written notice to appellant as to filing of their mechanic's liens as provided by Section 572.11. The trial court properly dismissed their claims, and these three parties are not involved in this appeal.
Appellant urges and relies upon three alleged errors for reversal. 1. In holding that there was an unpaid balance of $3,442 on the contract from appellant to the contractor. 2. If there was any amount unpaid on the contract to the contractor, which appellant does not concede, it was covered by the liens of United States of America; it also urges since government was not a party, no lien should have been established against appellant's property. 3. In holding that C. E. Hardy was a principal contractor to the extent of $412.30.
I. The property involved in this action, and as against which mechanic's liens were established, is described as follows: S.E. one-half of Tax Lot 10 and the S.W. thirteen feet of the S.E. one-half of Tax Lot 11, and the S.W. 150 feet of Tax Lot 15, all in Auditor's Plat of Lots 7, 8 and 9 in Block 59, Block 60, and the South one-half of Block 61 in Sioux City East Addition, and Blocks 51 and 52 in Sioux City, Iowa; also being described as the Southwesterly 63 feet of Lot 2, and the Southwesterly 150 feet of Lot 3, in Block 51, of the Original Plat of Sioux City, Iowa.
With the exception of evidence as to the claim of C. E. Hardy, as a principal *642 contractor, the parties stipulated as to the facts. In addition to $3,442 stipulated as balance on Sioux City contract, there was a possible additional item of $220 not settled by the stipulation or any evidence in the case. The trial court reserved jurisdiction for supplemental decree, as to this small item. It is not involved in the appeal. In supplemental decree to be entered after this decision has been filed, whatever the trial court holds as to this item shall be final.
There being no question about these figures the first question in the case is whether or not the possible amount owing by Bride Construction Company to appellant as to the contract for erection of service station at Logan can offset as against the $3,442 unpaid on the Sioux City contract.
In connection with the unpaid balance on the Sioux City contract of $3,442 the trial court said: "Balance due on this particular contract (Sioux City) fixes the liability of the owner to the subcontractors." We agree with this conclusion.
We hold the possible balance due from Bride to appellant at Logan cannot be used as an offset against the $3,442 for two reasons: A: the record in this case does not establish the fact that Bride owed appellant on the Logan job. B: Interpretation of term "balance due" under Section 572.11 means the subcontractors have a preferred claim to any balance, prior to any claims of the owner based on other transactions.
A. In connection with the situation at Logan we must accept the record as it appears in the instant case. We cannot project ourselves into the future, assume the happening of certain events and base our decision on such assumption. The record shows the following facts: the contract between appellant and Bride Construction Company as to erection of the service station at Logan; the amount paid to Bride, and balance owing him of $5,939.23; the filing of the subcontractors liens in Harrison County within sixty days of the completion of the work of the subcontractors and on the face of such liens claims are made for $10,284.59; the parties stipulated the mechanic's lien action had been tried in Harrison County District Court, but decision had not been rendered. This is the complete record as to the Logan situation.
The question is whether we are justified, on the basis of this record, to say that Bride owes appellant $3,442 or more. There is no evidence in the record as to whether the work of the subcontractors was completed, and as to what amount, if any, will be held to be due from appellant to the subcontractors. Since it was tried in court we can assume there was some controversy about the matter. The situation is too problematical and too remote for us to hold that Bride Construction Company owed appellant at least $3,442, or any amount.
B. Interpretation of Section 572.11 as to meaning of words "balance due" creates a question of first impression. While normally debtors and creditors may cast a balance between themselves based on more than one transaction, we hold the legislative intent as to said Section is that subcontractors, as to liens properly filed and proven, shall have the full benefit of all money due the contractor from the owner on the building or improvement involved.
When the legislature said the subcontractor was entitled to recover "to the extent of the balance due from the owner to the contractor" it placed the subcontractor in a preferred position as to such balance. The Section has reference to that particular job. The agreed amount to be paid for the job should be devoted to paying the cost of the job to the contractor and subcontractors who furnish labor and material, and should not be subject to offsets arising from other transactions between the owner and principal contractor.
*643 If the contractor sued the owner for the balance, the owner could successfully defend if proper subcontractor's liens existed. It creates a situation of "no debt" from the owner to the contractor. The debt is to the subcontractor. We will consider this theory at some length in Division II.
II. The United States of America tax lien does not attach to the unpaid balance on the Sioux City contract, to the extent of the amount owing to the subcontractors who perfected their lien rights. Fidelity & Deposit Co. of Maryland v. New York City Housing Authority, 2 Cir., 1957, 241 F.2d 142; United States v. Bess, 357 U.S. 51, 78 S.Ct. 1054, 2 L.Ed.2d 1135; Wolverine Insurance Co. v. Phillips, D.C.N.D.Iowa 1958, 165 F.Supp. 335, Judge Graven.
In recent federal court decisions the theory of "no debt", has been developed and approved. This means there is no fund or property to which the Government tax lien can attach.
In case of Wolverine Insurance Co. v. Phillips, supra, Judge Graven approved the doctrine. Mr. and Mrs. Loren H. Mahoney entered into a contract with Ericksson & Kochen for the erection of a home at a cost of $30,591. The home was erected and in accordance with the contract the owners made payments to the contractor as the work progressed. They paid $20,568.91, leaving unpaid the sum of $10,168.46. However, the contractors had not paid the subcontractors, and mechanic's liens were filed within the sixty day period in the amount of $19,248.02. As a part of the contract between the owners and the contractors a surety bond as to performance, and payment of subcontractors, was issued by Wolverine Insurance Company. The insurance company paid the subcontractors and took an assignment from the contractors as to the unpaid balance of $10,168.46 owing by the owners. Judge Graven held there was "no debt" as between the owners and the contractors. In view of the amount owing to the subcontractors the fund was the property of the subcontractors, not the contractor. Consequently there was no property of the contractor to which the tax lien could attach.
Similarly, to the extent of their claims, the fund of $3,442 in the hands of appellant was not the property of Bride Construction Company; it was the property of the subcontractors. The lien of the United States of America was against Bride Construction Company, but there was "no debt" owing to said construction company against which the lien could attach. We should observe at this point that the subcontractors' liens of the four appellees who perfected their mechanic's liens, do not total the sum of $3,442 so the "no debt" theory applies only to the extent of the amount owing to such subcontractors. We will make the distinction as to computations later in this decision.
Judge Graven's decision was based on the Circuit Court decision of Fidelity & Deposit Co. of Maryland v. New York City Housing Authority, supra, and the Supreme Court opinion of United States v. Bess, supra.
In Fidelity & Deposit Co. of Maryland v. New York City Housing Authority, supra [241 F.2d 147], the court said: "We are satisfied, then, that * * * the taxpayer-contractor had no right to the withheld fund. Of necessity, it follows that it had no `right to property' to which a federal tax lien might attach and the government's claim must fail."
Judge Graven said with reference to United States v. Bess, supra: "The United States Supreme Court has but recently stated that the tax lien statute does not create any property rights but merely attaches the rights created under the applicable state law. * * * Therefore, in the present case (Wolverine Insurance Co. v. Phillips) in order for the Government's tax liens to be of avail to it, there must at some time have been created under state law some enforceable right in behalf of the Contractor against the Owner for money due under the contract."
*644 In the Bess case [357 U.S. 51, 78 S.Ct. 1057] the United States Supreme Court stated: "Since § 3670 creates no property rights but merely attaches consequences, federally defined, to rights created under state law, Fidelity & Deposit Co. [of Maryland] v. New York City Housing Authority, 2 Cir., 241 F.2d 142, 144, we must look first to Mr. Bess' right * * * as defined by state law."
We therefore modify the decision of the trial court to the extent it attached the lien of the United States of America to the fund prior to liens of subcontractors Hooker Paint & Glass Mfg. Company and C. E. Hardy.
III. Mr. C. E. Hardy has been engaged in service station equipment repair business in Sioux City for more than twenty years. Under contract with Bride Construction Company he installed the tanks, pumps, hoist etc., at the station in Sioux City involved in this action. He completed his contract with Bride Construction Company on Saturday, July 9, 1955. That night a flood occurred in Sioux City and it covered the D-X station with two feet of water. The tanks had not yet been filled with gasoline and the flood floated them out of the ground and ruined all the connections and piping attached to the tanks.
Mr. Yarger, who had charge of the station for appellant, instructed Mr. Hardy to repair all the damage and to reinstate and re-connect the tanks in the same condition as they had been before the flood. Mr. Hardy proceeded to do so and completed the work in about twelve days. The cost of the repairs was $412.30. The trial court entered judgment against appellant in favor of Mr. Hardy as a principal contractor in connection with this item. Appellant challenges this judgment alleging the evidence does not support the claim.
In connection with the needed repairs to make the station useable after the flood the record discloses that Bride Construction Company had no part in the arrangements nor the work. The representative of appellant in Sioux City contacted Mr. Hardy direct, and requested him to make the repairs after the flood. He completed the reinstallation and is entitled to be paid therefor.
The decision of the trial court foreclosing a mechanic's lien on behalf of Mr. Hardy as a principal contractor against appellant is sustained by the evidence in the record and is correct.
IV. We modify the decision, and instruct that decree be rendered by the trial court foreclosing the mechanic's liens against the property heretofore described to the extent of the fund of $3,442 as follows: 1. Charles Ellis Bourrett, $1,231; 2. Beane Plumbing & Heating Company, $646; 3. Hooker Glass & Paint Mfg. Co., $610; 4. C. E. Hardy, as a subcontractor $557; 5. Balance of $398 is subject to tax lien of United States of America to be collected by proper further proceedings herein, or by independent action.
No interest shall accrue on above items until judgment is rendered in accordance with this decision, since they are a part of a specific fund allocated by statute to the parties involved.
Judgment for court costs in the District Court shall be rendered against defendant. There is no reason for deducting the costs from the fund belonging to the subcontractors, and possibly, to United States. Defendant filed answer and cross-petition, defended vigorously, and did not prevail.
The trial court shall also render judgment and foreclose mechanic's lien against appellant in favor of C. E. Hardy as a principal contractor, for $412.30, together with statutory interest from May 17, 1956, date of filing mechanic's lien.
Modified and affirmed.
GARFIELD, C. J., and BLISS, WENNERSTRUM, HAYS, THOMPSON, LARSON and LINNAN, JJ., concur.
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396 U.S. 282 (1970)
WADE
v.
WILSON, WARDEN, ET AL.
No. 55.
Supreme Court of United States.
Argued November 12, 1969.
Decided January 13, 1970.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT.
*283 Marshall L. Small, by appointment of the Court, 394 U. S. 941, argued the cause for petitioner. With him on the briefs was Melvin R. Goldman.
John T. Murphy, Deputy Attorney General of California, argued the cause for respondents. With him on the brief were Thomas C. Lynch, Attorney General, Albert W. Harris, Jr., Assistant Attorney General, and Karl S. Mayer, Deputy Attorney General.
MR. JUSTICE BRENNAN delivered the opinion of the Court.
In 1961, petitioner and one Pollard appealed to the California District Court of Appeal from murder convictions upon which the California Superior Court had sentenced each of them to life imprisonment. California Rules of Court 35 (c) and 10 (c) required that the appellants be furnished with one free copy of the trial transcript to be shared by them for the purposes of the appeal. Pollard received the free copy but would not share it with petitioner. However, the State Attorney General loaned petitioner's appellate counsel his copy. The District Court of Appeal affirmed the convictions, 194 Cal. App. 2d 830, 15 Cal. Rptr. 214 (1961).
Five years later, in 1966, petitioner wished to pursue a collateral remedy and sought the transcript from Pollard but Pollard "refuse[d] to communicate on the subject." Petitioner's inquiry of his appellate lawyer elicited the response that the copy borrowed from the Attorney General had been returned. Petitioner then turned to the California courts seeking, however, not temporary use of a copy, but to be furnished with a copy of his own. He applied initially to the trial court and was advised that the original of the transcript was in the District Court of Appeal. He thereupon filed a pro se motion for a copy in the District *284 Court of Appeal, which motion was denied on the ground that the Court of Appeal had only the original and was not equipped to duplicate copies. He next filed a proceeding in the California Supreme Court and was advised by the clerk of that court that he must proceed in "the court possessed of the original record."[1] He renewed his application to the District Court of Appeal, which again denied it on the ground that court had "no facility for reproducing records"; but this time petitioner was advised that the original record would be made available for copying at his expense. Petitioner then abandoned further efforts in the California courts.
In 1967, he filed the instant federal habeas corpus proceeding in the District Court for the Northern District of California. His petition alleged his indigency and the single claim that California's refusal to furnish him without cost his own copy of the transcript denied him due process and equal protection of the laws in violation of the Fourteenth Amendment. The District Court after hearing granted the writ and ordered California either to provide the free transcript or to release the petitioner. The District Court stated in an unreported opinion, "although there is no square holding on the precise question of the right to a transcript in preparing a petition for a writ of habeas corpus rather than an appeal, the logic of the Supreme Court holdings compels a finding that such a right exists."[2] The Court of Appeals for the *285 Ninth Circuit reversed on the ground that "the trial court failed to find that Wade was claiming that there was any error which occurred in the proceedings which led to his conviction which would warrant the granting of post-conviction relief. . . . Wade was not entitled to demand a transcript merely to enable him to comb the record in the hope of discovering some flaw." 390 F. 2d 632, 634 (1968). We granted certiorari. 393 U. S. 1079 (1969).
The California Court Rules require that a free transcript be furnished to convicted persons separately tried in felony cases and to each codefendant where one or more codefendants are under sentence of death.[3] Petitioner argues that in furnishing only one copy to be shared by codefendants where none received the death penalty California interposes an unconstitutional barrier to the use of its criminal appellate proceedings and that the *286 distinction made by the Rules, without more, establishes that California has denied him equal protection of the laws. But petitioner will not be heard to attack the Rules since they concern only the furnishing of transcripts for purposes of direct appeal and he and his appellate counsel in fact had the use on his direct appeal of the transcript borrowed from the State Attorney General and did not complain that the terms on which it was made available in any way impaired its effective use on the appeal. See United States v. Raines, 362 U. S. 17, 21-22 (1960).
Petitioner argues that in any event, contrary to the Court of Appeals, the District Court was correct in holding that because "it may not be possible to pinpoint . . . alleged errors in the absence of a transcript," petitioner was entitled to a transcript for use in petitioning for habeas corpus even though he did not specify what errors he claimed in his conviction. To pass on this contention at this time would necessitate our decision whether there are circumstances in which the Constitution requires that a State furnish an indigent state prisoner free of cost a trial transcript to aid him to prepare a petition for collateral relief. This is a question of first impression which need not be reached at this stage of the case. Notwithstanding petitioner's success in borrowing a copy of the transcript in connection with his direct appeal, his insistence in the subsequent proceedings in both the California and federal courts is that he has a constitutional right to a copy of his own. We think consideration of that contention should be postponed until it appears that petitioner cannot again borrow a copy from the state authorities, or successfully apply to the California courts to direct his codefendant, Pollard, or some other custodian of a copy to make a copy available to him. Cf. Rule 10 (c). Without such a showing, or a showing that having his own copy would *287 be significantly more advantageous than obtaining the use of someone else's copy, the District Court should not have reached the merits of petitioner's claim. We think, however, that the case should be retained on the District Court's docket pending petitioner's efforts to obtain access to the original or a copy. Upon being advised by the parties that petitioner has been provided such access, the court should dismiss the action. We vacate the judgments of both the Court of Appeals and the District Court and remand to the District Court for further proceedings consistent with this opinion.
It is so ordered.
MR. JUSTICE BLACK, dissenting.
Petitioner and one Joe Pollard were convicted of murder in 1960 and sentenced to life imprisonment. Pollard received a trial transcript and when he refused to turn it over to petitioner for his use in preparing an appeal, the State Attorney General's Office loaned a copy to petitioner's appellate counsel. The California District Court of Appeal affirmed in 1961. 194 Cal. App. 2d 830, 15 Cal. Rptr. 214. Five years later, in 1966, petitioner tried in the state courts to obtain a trial transcript. Failing there, he filed a petition in the United States District Court for the Northern District of California in 1967 asking to be released because of the State's refusal to provide him a copy of the transcript. The United States District Court held petitioner was entitled to a copy of the trial record but the United States Court of Appeals reversed, holding that since petitioner did not allege any trial error which might warrant post-conviction relief he was "not entitled to demand a transcript merely to enable him to comb the record in the hope of discovering some flaw." 390 F. 2d 632, 634 (1968).
*288 This Court today says the petitioner thus raises a constitutional question of first impression, "whether there are circumstances in which the Constitution requires that a State furnish an indigent state prisoner free of cost a trial transcript to aid him to prepare a petition for collateral relief." Ante, at 286. It may be conceivable that the Constitution would under certain special circumstances impose this duty on the State when it has such a record in its possession, but I cannot agree that anything shown in this record presents those special circumstances.
It is now over nine years since this case was tried. At petitioner's request a trial record was made available for him to take an appeal; eight years ago he took that appeal and lost. There certainly is no constitutional requirement that a State must continue to supply convicted defendants trial records to enable them to raise the same old challenges to their convictions again and again and again. There is not a word or a suggestion in the whole record in this case that demonstrates or even intimates that any new events have occurred since petitioner's 1961 appeal which could under any possible circumstances justify even a shadowy argument that petitioner was not guilty of the murder he was convicted of having committed. Although more than eight years have passed since that appeal, I would join in granting relief to this petitioner if he had shown, or even given any reason to believe, that new circumstances now indicate he was wrongfully convicted of a crime of which he was not guilty. See Fay v. Noia, 372 U. S. 391 (1963); cf. Kaufman v. United States, 394 U. S. 217, 231 (1969) (BLACK, J., dissenting); Harris v. Nelson, 394 U. S. 286, 301 (1969) (BLACK, J., dissenting). But we have no such case here. Petitioner has not raised any claims which indicate in the slightest that he has been convicted of a crime of which he is innocent. At the *289 most he has asserted a desire to review the record to find some technical legal point which he can argue to a court as a basis for release from confinement. He has already had one chance to make such arguments on direct appeal, and he lost that battle. I do not think he needs a transcript to know whether he was convicted erroneously or whether some new circumstances have arisen that now show a fatal constitutional error in the prior proceedings. In any event he has not yet based his request for a transcript on any indication of such a need. In such circumstances I see no reason whatsoever for the State to have to obtain a copy for him. This case is but another of the multitudinous instances in which courts are asked interminably to hash and rehash points that have already been determined after full deliberation and review. One considered appeal is enough, in the absence of factors which show a possibility that a substantial injustice has been inflicted on the defendant.
Nothing in this petitioner's application for certiorari or his briefs and arguments gave any indication that he might be entitled to post-conviction relief, and there is thus no reason why this Court should even have reviewed his case. I would dismiss this writ as being improvidently granted.
NOTES
[1] Petitioner styled his application to the Supreme Court of California "A Petition for a Writ of Habeas Corpus" but the only relief he requested was issuance of the record in his case or an order to the District Court of Appeal to furnish him with the record. He did not request an order releasing him from custody.
[2] The District Court cited Smith v. Bennett, 365 U. S. 708 (1961) (habeas corpus filing fee); Griffin v. Illinois, 351 U. S. 12 (1956) (transcript on direct appeal); Lane v. Brown, 372 U. S. 477 (1963) (transcript on post-conviction appeal); Long v. District Court, 385 U. S. 192 (1966) (transcript on post-conviction appeal). See also Roberts v. LaVallee, 389 U. S. 40 (1967); Gardner v. California, 393 U. S. 367 (1969).
[3] Rules 35 (c) and 10 (c) provide in pertinent part:
Rule 35 (c): "As soon as both the clerk's and reporter's transcripts are completed, the clerk shall deliver one copy to the defendant or his attorney and one copy to the district attorney . . . . When there are two or more appealing defendants in a case in which a judgment of death has been rendered against one or more of the defendants, the clerk shall deliver a copy of both transcripts to each such defendant or his attorney . . . . Where there are two or more appealing defendants represented by separate counsel in a case in which judgment of death has not been rendered against any defendant, the appellant's copy shall be made available for the use of the appellants in the manner provided in Rule 10."
Rule 10 (c): "The additional copy of the record required by these rules shall be made available for the use of the parties to the appeal in such manner as the judge, or the clerk under his direction, shall prescribe; provided that the parties may stipulate to its use, and in such event only the original need be filed with the clerk of the superior court."
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Cite as 2014 Ark. App. 350
ARKANSAS COURT OF APPEALS
DIVISION II
No. CR-13-1012
Opinion Delivered June 4, 2014
DENARIUS A. MARTIN
APPELLANT APPEAL FROM THE CRITTENDEN
COUNTY CIRCUIT COURT
V. [NO. CR-2008-459]
STATE OF ARKANSAS HONORABLE RANDY F.
APPELLEE PHILHOURS, JUDGE
AFFIRMED; MOTION TO
WITHDRAW GRANTED
BILL H. WALMSLEY, Judge
On June 30, 2008, appellant Denarius Martin pleaded guilty to burglary, and he
received five years’ probation and was ordered to pay restitution, fines, fees, and costs. On
April 22, 2013, the State filed a petition to revoke his probation alleging, among other things,
that Martin failed to make any payments toward what he owed. The Crittenden County
Circuit Court found that Martin had violated the terms and conditions of his probation and,
upon revocation, sentenced him to two years in a regional correctional facility followed by
seven years’ suspended imposition of sentence. Defense counsel has filed a motion to
withdraw on the basis that there is no merit to an appeal.
Pursuant to Anders v. California, 386 U.S. 738 (1967), and Rule 4-3(k) of the Rules
of the Arkansas Supreme Court and Court of Appeals, defense counsel’s motion was
accompanied by a brief that purports to address all adverse rulings with an explanation why
Cite as 2014 Ark. App. 350
each ruling is not a meritorious ground for reversal. Martin was provided with a copy of
counsel’s brief and notified of his right to file pro se points for reversal. Martin has not filed
any points.
From our review of the record and the briefs presented to us, we agree with defense
counsel that there is no merit to an appeal. Accordingly, we affirm the order of revocation and
grant defense counsel’s motion to withdraw.
Affirmed; motion to withdraw granted.
HARRISON and WYNNE, JJ., agree.
C. Brian Williams, for appellant.
No response.
2
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27 F.3d 557
Magestro (Paul J.)v.Shalala (Donna), Secretary, Department of Health and Human Services
NO. 93-2005
United States Court of Appeals,Third Circuit.
May 12, 1994
1
Appeal From: E.D.Pa.
2
AFFIRMED.
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91 F.3d 867
Pens. Plan Guide P 23923XMichael K. MORTON, Plaintiff-Appellant,v.Edward M. SMITH, Ronald Howard, Richard Reynolds, HarlinNewlin, Mike Meyer, W. Tom Arnold, William Butler, WilliamRegenhart, Thomas Tinsley and Virgil Wortham, as Trustees ofthe Southern Illinois Laborers and Employers Health andWelfare Fund, Defendants-Appellees.
No. 95-2674.
United States Court of Appeals,Seventh Circuit.
Argued Jan. 10, 1996.Decided July 29, 1996.
Eric L. Terlizzi (argued), Pfaff, Garner & Terlizzi, Salem, IL, for Plaintiff-Appellant.
Patrick J. O'Hara (argued), Michael W. O'Hara, Cavanagh & O'Hara, Springfield, IL, for Defendants-Appellees.
Before WOOD, Jr., CUDAHY and ROVNER, Circuit Judges.
CUDAHY, Circuit Judge.
1
Michael Morton was a covered beneficiary of a health and welfare fund regulated by the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. § 1001, et seq. His benefits from the fund included reimbursement for most medical expenses, but not for medical expenses associated with "intentionally self-inflicted injuries." Morton suffered an injury when, according to his lawyer's account, he was "very, very drunk ... and did something very, very stupid." The trustees of the fund decided that this injury was intentionally self-inflicted, and they denied him benefits. Morton sued them in the district court, contending that their interpretation of the terms of the fund's provisions was unreasonable and therefore violated ERISA. The district court rejected this contention and ruled for the trustees. We affirm.I.
2
At two o'clock in the morning on August 28, 1994, Michael Morton was in a bar in Centralia, Illinois after an evening of carousing with friends, and he was drunk. When he and another patron had an altercation, the bar's bouncer threw him out of the back door. Morton chose an unorthodox route to the front. He found a way to clamber up the side of the building and onto the bar's roof. From this perch, he could see his friends leaving by the front door. In an attempt to catch up with them, he lowered himself to the metal awning across the front of the bar and jumped to the sidewalk, an eight-foot drop. The fall broke his leg, and he was taken to the hospital where doctors treated his leg and measured his blood alcohol level at .23. The medical bills associated with this injury amounted to more than $20,000.
3
At the time, Morton was a beneficiary of a trust created by the Southern Illinois Laborers' District Council, an association of local labor unions, and the Associated General Contractors of Illinois. This trust is regulated by ERISA. As determined by the trust agreement, the trust is known as the Southern Illinois Laborers and Employers Health and Welfare Fund (the Fund), and it purports to provide health care benefits, life insurance and other similar benefits. The trust agreement gives the trustees the authority to determine, adopt and administer benefit plans consistent with its purpose. According to the terms of one such benefit plan, the Fund reimburses its beneficiaries for most medical expenses, but it denies reimbursement for "[a]ny loss, expense or charge which results from an intentionally self-inflicted injury or sickness, suicide or attempted suicide, while sane or insane." Morton submitted his medical bills to the Fund, but it refused to pay them, concluding that the injury giving rise to the bills was intentionally self-inflicted. The trust agreement created a procedure for appealing this decision, and Morton pursued it, but the trustees stood by their conclusion.
4
Morton filed a suit in state court under ERISA, claiming that the trustees violated ERISA by unreasonably interpreting the term "intentionally self-inflicted injury" in the benefit plan. The case was removed to the district court where he and the trustees filed a joint stipulation of the facts and made cross-motions for summary judgment. The district court ruled in favor of the trustees, deciding that it could not overrule the trustees' interpretation of the benefit plan because it was not arbitrary and capricious.
II.
5
Morton challenges the district court's summary judgment in three ways. He first questions whether the district court employed the proper standard of review in its consideration of the trustees' interpretation of the benefit plan. He then contends that the trustees' decision cannot be affirmed under any standard of review because it was made outside the scope of their authority. Finally, he maintains that their interpretation was unreasonable even when considered under a deferential standard of review. Especially when the summary judgment depends upon legal conclusions like those that Morton challenges here, our review is de novo. See Butler v. Encyclopedia Brittanica, Inc., 41 F.3d 285, 287 (7th Cir.1994).
A.
6
The nature of ERISA determines the standard by which courts review the administration of a covered benefit plan. When it adopted ERISA, Congress sought to regulate the way in which the fiduciaries of employee benefit plans administered those plans by establishing standards of "conduct, responsibility, and obligation" for them. See 29 U.S.C. § 1001(b). These standards are defined in a federal common law which is modeled on the common law of trusts. See Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 110-11, 109 S.Ct. 948, 954-955, 103 L.Ed.2d 80 (1989). When the fiduciaries of a covered plan decide who is eligible for benefits, the common law of ERISA controls their decision-making. See id. at 108, 109 S.Ct. at 953. If the beneficiary of a plan believes that its fiduciaries have improperly denied him benefits, he may bring an action to challenge their decision. 29 U.S.C. § 1132(a)(1)(B).
7
In Firestone, the Supreme Court determined how courts should review the decision-making of plan fiduciaries in an action challenging the denial of benefits. Following the fundamental principles of trust law, the Court held that the judicial review of benefit eligibility determinations will vary in accordance with the extent of the fiduciaries' power to construe the terms of the benefit plan. Firestone, 489 U.S. at 110-15, 109 S.Ct. at 954-57. When the fiduciaries do not have any discretion to construe the terms of the plan, courts make a de novo review of their interpretations. Id. at 115, 109 S.Ct. at 956-57. When the fiduciaries do have the discretion to construe the plan's terms, courts are deferential, overturning the fiduciaries' interpretations only if they constitute an abuse of discretion. Id.
8
We have previously held that Firestone did not establish a single standard for reviewing the discretionary decisionmaking of plan fiduciaries. Rather, Firestone presented a "smorgasbord of possibilities" for standards of review. Exbom v. Central States, Southeast & Southwest Areas Health & Welfare Fund, 900 F.2d 1138, 1141-43 (7th Cir.1990). The extent of discretion determines the extent of judicial deference. When fiduciaries have the discretion to make "reasonable" interpretations of a plan, their decisions are reviewed according to the familiar abuse-of-discretion standard. Id. at 1142. A decision constitutes an abuse of discretion when it is "not just clearly incorrect but downright unreasonable." Fuller v. CBT Corp., 905 F.2d 1055, 1058 (7th Cir.1990). When fiduciaries are bound to interpret the plan under the broad standard of good faith, their discretion is even more extensive, and judicial review is even more deferential. Courts will then examine the exercise of this degree of discretion to determine whether it is arbitrary and capricious. Exbom, 900 F.2d at 1142.
9
Section 10.01 of the trust agreement that created the Fund defines the nature of the discretion afforded to the trustees. Section 10.01 provides, in its entirety:
10
This trust is created and adopted in the State of Illinois and all questions pertinent to the validity or construction of this Instrument and of the acts and transactions of the parties hereto shall be determined in accordance with the laws of the State of Illinois. The Trustees shall construe the provisions of this Trust Agreement and any plan adopted hereunder, and any reasonable construction thereof by them shall be binding on all interested persons.
11
In considering the cross-motions for summary judgment, the district court concluded that this section required it to determine whether the trustees of the Fund were arbitrary and capricious when they decided that Morton's injury was intentionally self-inflicted.
12
Morton argues that the district court was too deferential, and he is correct, at least in a technical sense. As Exbom held, the arbitrary-and-capricious standard is appropriate when discretion is limited only by good faith. When the plan administrators have the discretion to make reasonable constructions of the terms of the plan, courts should review their interpretations for the abuse of discretion. According to § 10.01, the trustees here only have the discretion to make reasonable constructions. The district court should therefore have reviewed their decision according to the abuse-of-discretion standard. The district court invoked the arbitrary-and-capricious standard, but its analysis was the functional equivalent of the abuse-of-discretion standard because it examined the trustees' interpretation for reasonableness.
B.
13
Morton argues that the trustees' decision in his case is not entitled to our deference, regardless of the standard of review. He bases this argument on the idea that the trustees' discretionary authority did not include the power to interpret "intentionally self-inflicted injury" as they did. If we conclude that their interpretation was indeed ultra vires, we would not review it for abuse of discretion.
14
In Morton's view, the terms of § 10.01 establish fairly narrow limits on the trustees' discretion to construe the terms of the benefit plan. He finds one limit in the provision that the trustees' "construction of this Instrument ... shall be determined in accordance with the laws of the State of Illinois." According to Morton, this provision confines the trustees' discretion by requiring them to interpret the benefit plan under Illinois law. This reading leads him to the conclusion that any interpretation contradicting Illinois law exceeds the scope of their discretion. He contends that the trustees have made such a defective interpretation here because their interpretation of the plan is not consistent with the rules of Illinois insurance law, which requires that the terms of an insurance contract excluding coverage should be narrowly construed in favor of the insured. See Lubeznik v. HealthChicago, Inc., 268 Ill.App.3d 953, 206 Ill.Dec. 9, 12, 644 N.E.2d 777, 780 (1 Dist.1994).
15
This proposed limitation on the scope of the trustees' discretionary authority is untenable because Morton has misread § 10.01. That section brings "this Instrument" under the ambit of Illinois law, but "this Instrument" is the trust agreement, not the benefit plan. Thus, § 10.01 does not require construction of the benefit plan according to Illinois law; it only requires that Illinois law determine the construction of the trust agreement. Moreover, if Morton's reading of § 10.01 were correct, that section could not be given effect. The federal common law of ERISA preempts most state law in regulating the interpretation of benefit plans. See Shaw v. Delta Air Lines, 463 U.S. 85, 98, 103 S.Ct. 2890, 2900-01, 77 L.Ed.2d 490 (1983); UIU Severance Pay Trust Fund v. Local Union No. 18-U, United Steelworkers of America, 998 F.2d 509, 512 (7th Cir.1993). Consequently, we cannot conclude that the trustees' discretion is limited to obedience to Illinois law.1
16
Morton suggests that there is another limit on the trustees' interpretive discretion, arguing that the trustees can never have the discretion to construe what he calls "common, ordinary words." He seems to base this argument on the principle that the terms of an ERISA benefit plan must be given their common, ordinary meaning. That is, they must be construed as a lay person would construe them, not as someone with specialized knowledge would. Phillips v. Lincoln Nat'l Life Ins. Co., 978 F.2d 302, 314 (7th Cir.1992). Of course, we accept this principle, but it does not support Morton's argument. Common, ordinary words often have more than one common, ordinary meaning. When a common, ordinary word with multiple meanings appears in a plan, it must be construed. A trustee with the discretion to construe generally is not prevented from construing such a word; he or she is only prevented from giving that word an uncommon, extraordinary meaning. This principle defines the manner in which trustees must exercise their discretion; it does not establish a limit of that discretion. It is really a specific way to define what constitutes a reasonable construction. Morton has thus failed to show that there are any special limits on the trustees' discretion to construe the plan. Their discretion was to make reasonable constructions.
C.
17
We must therefore determine whether the trustees abused their discretion when they defined Morton's broken leg as an intentionally self-inflicted injury. We cannot find an abuse if the trustees employed a definition that a reasonable person would use. Fuller, 905 F.2d at 1058. Defining Morton's injury here involved a construction of the term "intentionally self-inflicted injury" and an application of the facts of Morton's case to that construction. If we can hypothesize a reasonable construction and a reasonable application of that construction that would justify the trustees' definition, we can conclude that the trustees were reasonable.
18
Morton thinks that the trustees were unreasonable in both aspects of their definition, maintaining that there is one and only one reasonable construction of the term "intentionally self-inflicted injury" and that his injury is not included under it. His preferred construction defines an "intentionally self-inflicted injury" as any injury that is not an accident, and it defines an accident as something that is not the substantially certain result of an intentional act. Morton argues that a federal court has endorsed this construction when interpreting an ERISA benefit plan in Todd v. AIG Life Ins. Co., 47 F.3d 1448 (5th Cir.1995) (construing the meaning of "accidental injury" on de novo review). And he insists that, under this construction, his broken leg would not be an intentionally self-inflicted injury. Although he admits that he intended to jump from an eight-foot height, he contends that his injury was not a substantially certain result of that intentional act, pointing out that his job as an oil-field laborer required him to make many similar jumps and that he had never been injured from such jumps in the past. He thus offers his own experience as proof that his injury was not the substantially certain result of his act.
19
We cannot agree that this is the only reasonable way to think about Morton's injury. We do not doubt that it is one reasonable way, and if we had to assume authority for construing Morton's benefit plan on our own, we might adopt it. But we are being deferential here, and there is another reasonable way to define Morton's injury as "intentionally self-inflicted" (as we shall show in a moment). For Morton does not present the only reasonable construction of "intentionally self-inflicted injury." In considering whether the trustees were arbitrary and capricious, the district court found another construction of this term based on concepts commonly used in insurance law. The district court accepted Morton's premise that an "intentionally self-inflicted injury" is a non-accidental injury. The court then noted that, in the parlance of insurance law, an injury is not an accident if it is the natural and probable consequence of an intentional act. See 10 Couch on Insurance 2d § 41.17 (1982). The district court reasoned that an intentionally self-inflicted injury is an injury that is the natural and probable consequence of an intentional act. Because this construction is founded on a rational application of well-established legal concepts, we conclude that it is a reasonable one. It would have been reasonable for the trustees to apply a construction leading to the conclusion that a broken leg is a natural and probable consequence of a jump from eight feet above the ground. Consequently, we can imagine one scenario in which a reasonable person would have made the same decision as the trustees. This is enough to show that the trustees did not abuse their discretion.
20
The judgment of the district court is AFFIRMED.
1
As an aside, we note that the rule of contract interpretation that Morton invokes here can sometimes be relevant to the interpretation of an ERISA benefit plan. The federal common law of ERISA does provide that ambiguous terms in benefit plans should be construed in favor of beneficiaries. Phillips v. Lincoln Nat'l Life Ins. Co., 978 F.2d 302, 311 (7th Cir.1992). But this rule has no application here. Often called the rule of contra proferentem, it is a device for determining the intended meaning of a contract term in the absence of conclusive evidence about intent. See Winters v. Costco Wholesale Corp., 49 F.3d 550, 554 (9th Cir.1995). Courts invoke this rule when they have the authority to construe the terms of a plan, but this authority arises only when the administrators of the plan lack the discretion to construe it themselves. See Firestone, 489 U.S. at 110-15, 109 S.Ct. at 954-57. Therefore, it is only used when courts undertake a de novo review of plan interpretations. See Phillips, 978 F.2d at 311-12; see also Winters, 49 F.3d at 554. When the administrators of a plan have discretionary authority to construe the plan, they have the discretion to determine the intended meaning of the plan's terms. In making a deferential review of such determinations, courts have no occasion to employ the rule of contra proferentem. Deferential review does not involve a construction of the terms of the plan; it involves a more abstract inquiry--the construction of someone else's construction. Because this case engages us in this more abstract exercise, we will not apply the rule
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795 F.2d 82
Nettlesv.Samberg
86-7113
United States Court of Appeals,Fourth Circuit.
7/3/86
1
E.D.Va.
AFFIRMED
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959 A.2d 967 (2008)
COM.
v.
KNORR.
No. 1284 WDA 2007.
Superior Court of Pennsylvania.
June 30, 2008.
Reversed, Vacated and Remanded.
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662 F.Supp. 1260 (1987)
UNITED STATES of America
v.
Victor Manuel GERENA, et al.
Crim. No. H-85-50 (TEC).
United States District Court, D. Connecticut.
June 3, 1987.
*1261 Albert S. Dabrowski, Carmen E. Van Kirk, John A. Danaher, III, Stanley A. Twardy, Jr., U.S. Attys., David D. Buvinger, William J. Corcoran, Trial Attys., U.S. Dept. of Justice, Hartford, Conn., for plaintiff.
Juan R. Acevedo, Hartford, Conn., for Norman Ramirez Talavera.
Harold Meyerson, New York City, for Ivonne Melendez Carrion.
Diane Polan, New Haven, Conn., for Elias Castro Ramos.
Margaret P. Levy, Hartford, Conn., for Angel Diaz Ruiz.
Michael Deutsch, Chicago, Ill., for Orlando Gonzalez Claudio.
John Williams, New Haven, Conn., for Hilton Fernandez-Diamante.
James Bergenn, Shipman & Goodwin, Hartford, Conn., for Carlos Ayes-Suarez.
Richard Reeve, Asst. Federal Public Defender, New Haven, Conn., for Isaac Camacho-Negron.
Linda Backiel, Philadelphia, Pa., for Antonio Camacho Negron.
Leonard I. Weinglass, New York City, for Juan E. Segarra-Palmer.
William M. Kunstler, New York City, for Filiberto Ojeda Rios.
Michael Avery, Avery & Friedman, Boston, Mass., for Jorge Farinacci Garcia.
Ronald L. Kuby, New York City, for Luis Colon Osorio.
Robert J. Maldonado-Rivera, Rio Piedras, P.R., pro se.
F. Mac Buckley, Buckley & Santos, Hartford, Conn., for Paul Weinberg.
Jacob Wieselman, Hartford, Conn., for Luz Berrios-Berrios.
RULING ON DEFENDANT JUAN SEGARRA PALMER'S "STANDING" TO CHALLENGE THE ADMISSABILITY OF EVIDENCE SEIZED AT 45 COTTAGE STREET, CAMBRIDGE, MASSACHUSETTS
CLARIE, Senior District Judge.
The defendant Juan Segarra Palmer claims to have standing to seek the suppression of evidence obtained as a result of the August 30, 1985 search of the apartment residence of non-defendant Anne Gassin located at 45 Cottage Street, Cambridge, Massachusetts. The defendant alleges that he had a reasonable expectation of privacy in the apartment. The Court finds, however, that the defendant's allegations, even if taken as true, do not make out a colorable standing claim sufficient to permit the Court to proceed further on this issue. The Court concludes that the defendant's claim of standing with regard to the apartment must be denied.
Facts
The 45 Cottage Street location is a two-floor apartment occupying the second and third floors of a wooden frame, duplex structure. On August 30, 1985, and for some time prior to this date, Anne Gassin resided there with two roommates: Abagail Snyder and Melissa Zieve. Transcript of Proceedings of January 29, 1987, pp. 119-20. The Apartment was rented to Ms. Melissa Zieve, Id. at 143, with each roommate *1262 contributing $250 per month towards the rent and upkeep of the premises. Id. at 122. The defendant, Juan Segarra, does not claim that he contributed anything toward the rent of the apartment, or its normal upkeep. The phone and other utilities were listed in the name of Ms. Zieve. Id. at 143-44. The defendant does claim that he contributed some amount towards payment of the phone bill. Affidavit Regarding Standing of Defendant Juan Enrique Segarra Palmer, filed [by defendant Juan Segarra Palmer] February 24, 1987, p. 2.
Each roommate occupied her own bedroom. Gassin's room was located on the second floor, along with the living room and the kitchen. Id. at 121, 125. The apartment's bathroom, as well as the bedrooms of the other two occupants were all located on the third floor. Id. at 121-22.
Discussion
The uncontested facts, drawn largely from F.B.I. surveillance activities, reveal that Segarra visited Anne Gassin at her apartment on several occasions, and that the two were intimately involved in laundering money believed to be part of the proceeds of the September 12, 1983 robbery of the Wells Fargo Depot in West Hartford, Connecticut. Government's Title III Discovery, vol. XV, pp. 490-91 (affidavit of Agent Neil P. Cronin).[1] The Government also claims that Gassin and Segarra were "lovers," Transcript of Proceedings of January 29, 1987, p. 146 (remarks of Assistant U.S. Attorney Dabrowski), suggesting that Segarra's trips to Cambridge were motivated in part by his personal relationship with Anne Gassin rather than solely by his interest in the stolen money. Id. 153-55 (remarks of attorney Weinglass).
The record indicates that, following a brief meeting with Anne Gassin in Mexico City on February 14, 1985, the defendant stayed at Gassin's apartment from February 21, 1985 to March 2, 1985. Government's Title III Discovery, vol. xv., pp. 40-43. Following this visit, Segarra returned to his family in Puerto Rico. Id. at 36-37. Segarra returned to Cambridge, and again stayed with Gassin at her apartment from April 25, 1985 to May 7, 1985, (excluding April 29 and 30 when Segarra visited defendant Paul Weinberg in western Massachusetts). Id. at 491. During this later visit, Segarra, then at Gassin's apartment, was overheard discussing his efforts at counting some of the stolen money. Id. at 439-40. On May 7, 1985, Segarra returned to Puerto Rico.
Segarra last visited Gassin's apartment from July 1 to July 3, 1985. Id. at 494-95; Transcript of Proceedings of January 29, 1987, p. 142 (remarks of Attorney Weinglass). Following this visit, Segarra joined his family in Cuernavaca, Mexico. Segarra was arrested on August 30, 1985 at the Dallas/Ft. Worth International Airport in Texas. Transcript, at 153 (remarks of Attorney Weinglass). At the time of his arrest Segarra alleges that he was on his way back to Boston to again visit with Anne Gassin. Id. 153-54.
In addition to alleging that he contributed towards the phone bill and that he stayed at the premises on occasion, Segarra also alleges 1) that he had a key to the apartment; 2) that he kept clothing and other personal effects there; 3) that he stored merchandise there in connection with his clothing business; and 4) that he had the expectation that his clothing, merchandise, and personal effects would remain private. Affidavit, p. 2. The defendant argues that these allegations are sufficient to form an adequate foundation on which the Court could find that he possessed a reasonable expectation of privacy in the apartment at the time of its search. The Court finds, however, that the defendant has failed to adequately make out a colorable standing claim sufficient to entitle *1263 him to a hearing on the merits. Even assuming that the defendant's allegations are true, they do not constitute a valid standing claim.
The defendant bears the burden of establishing Fourth Amendment standing as a prerequisite to his seeking to exclude the fruits of a search and seizure on Fourth Amendment grounds. Rakas v. Illinois, 439 U.S. 128, 131 n. 1, 99 S.Ct. 421, 424 n. 1, 58 L.Ed.2d 387 (1978); United States v. Smith, 621 F.2d 483, 486 (2d Cir.1980), cert. denied, 449 U.S. 1086, 101 S.Ct. 875, 66 L.Ed.2d 812 (1981). In order to establish Fourth Amendment standing, a defendant must show 1) that he or she personally sought to preserve the area searched as private and 2) that his or her expectation of privacy in the location was objectively reasonable. Smith v. Maryland, 442 U.S. 735, 740, 99 S.Ct. 2577, 2580, 61 L.Ed.2d 220 (1979). A defendant may have standing to challenge the search of his girlfriend's apartment if he can demonstrate the objective reasonableness of his expectation of privacy there under this test. United States v. Donaldson, 606 F.Supp. 325, 329 (D.Conn.1985). The Court finds, however, that, under the circumstances, defendant Segarra's allegations fail to establish a legally sufficient standing claim.
In Donaldson, the Court concluded that the defendant, Ronald Donaldson, had standing to contest the search of his girlfriend's apartment on the basis that, at the time of the search and for some time prior thereto, the defendant had resided at the apartment, kept personal clothing and possessions there, shared financial and personal responsibility for maintenance of the apartment, and kept the apartment's phone in his own name. Id. at 329. Unlike the situation in Donaldson, however, Segarra did not reside at Anne Gassin's apartment. In fact, the record reveals that he only visited the location on an irregular basis, and then only for periods of brief duration. The sporadic nature of the defendant's visitations seriously undermines his claim. See United States v. Garcia, 741 F.2d 363, 366 (11th Cir.1984) (defendant lacked standing where he failed to demonstrate that his contacts with the apartment were "regular or personal enough" despite his control of the premises, his presence at the time of its search, and his use of the apartment by appointment to conduct his cocaine trade); United States v. Mankani, 738 F.2d 538, 545 (2d Cir.1984) (despite the fact that the defendants lived in rooms in the house, they had no expectation of privacy in the barn where they neither resided, nor kept personal belongings, and only visited periodically).
The defendant's other allegations do not correct this deficiency, nor do they, of themselves, serve as an adequate basis for standing. To begin with, the defendant claims that he kept belongings at the apartment and that he expected that they would remain private. However, "the privacy interest that must be established to support standing is an interest in the area searched, not an interest in the item[s] found." United States v. Manbeck, 744 F.2d 360, 374 (4th Cir.1984), cert. denied, O'Hare v. United States, 469 U.S. 1217, 105 S.Ct. 1197, 84 L.Ed.2d 342 (1985). "At most, an interest in the items found may be a factor considered when deciding whether there is a privacy interest in the area searched." Id. at 374.
The defendant also claims that he contributed some amount towards the phone bill. The Court finds that this factor adds little to the defendant's standing claim. See United States v. Tussel, 441 F.Supp. 1092, 1103 (M.D.Pa.1977) (one who merely finances the leasing of an airplane does not have a reasonable expectation of privacy as to the plane). The fact that the defendant may have paid part of the phone bill scarcely advances his claim that he attempted to preserve the location as private and that his professed expectation of privacy in the apartment is one that society is prepared to accept as reasonable. Likewise, the fact that the defendant may have had a key to the apartment is of no special significance. United States v. Baron-Mantilla, 743 F.2d 868, 870 (11th Cir.1984).
*1264 The Court finds that Segarra's professed interest in Anne Gassin's apartment lacks most of the significant aspects of "reasonableness" present in the Donaldson case.[2] In fact, the defendant's factual allegations, even taken as true, establish that his claim is substantially similar to claims that have been denied by a number of courts. See United States v. Jimenez, 789 F.2d 167, 170 (2d Cir.1986) (defendant found to lack standing in co-defendant's apartment); United States v. Rackley, 742 F.2d 1266, 1270 (11th Cir.1984) (defendant lacked standing with regard to search of host's home despite the fact that he possessed a key, stayed overnight on several occasions, and kept some belongings there); United States v. Robinson, 698 F.2d 448, 454-55 (D.C.Cir.1983) (defendant lacked standing with regard to host's home where others entered the premises freely); United States v. Meyer, 656 F.2d 979, 981 (5th Cir.1981), cert. denied, 465 U.S. 1065, 104 S.Ct. 1413, 79 L.Ed.2d 739 (1984) (guest had no expectation of privacy in hosts' bathroom cabinet); United States v. Vicknair, 610 F.2d 372, 380-81 (5th Cir.1980), cert. denied, 449 U.S. 823, 101 S.Ct. 83, 66 L.Ed.2d 25 (1980) (the mere fact that some defendants had keys to the boat, had slept there, and kept belongings there on an intermittent basis was insufficient for standing purposes); United States v. Badr, 604 F.Supp. 569, 578 (E.D.N.Y.1985) (defendant, a Bostonian who had come to New York in connection with the drug transaction, had no standing to challenge the search of the Queens apartment); United States v. Morales, 568 F.Supp. 646, 649 (E.D.N.Y.1983) (casual visitors lack standing to challenge the search of a residence).[3] In Jimenez, the Court of Appeals for the Second Circuit concluded that the defendant in that case, Raymond Jimenez, lacked standing with regard to his co-defendant's apartment even though he had occasional access to the apartment "upon his specific request of the owner for the key," and he had admitted that some of the evidence seized from the apartment belonged to him. Like Raymond Jimenez, Segarra did not own, rent, or reside at the Cottage Street apartment; nor did he have control or unlimited access to the premises. See United States v. Freire, 710 F.2d 1515, 1519 (11th Cir.1983), cert. denied, 465 U.S. 1023, 104 S.Ct. 1277, 79 L.Ed.2d 681 (1984) (while ownership by itself is not talismanic of reasonableness, "[i]t is, nevertheless, a bright star by which courts are guided when the place invaded enjoys universal acceptance as a haven of privacy, such as one's home"). Despite the fact that he had a key, Segarra could only stay at Gassin's apartment with her consent. Segarra had no right to exclude others from the premises, particularly Anne Gassin's other roommates. He did not give out the address of the Cottage Street apartment as his own. In fact, he rented a mailbox under a ficticious name at Security Mail Service located at 89 Massachusetts Avenue in Boston. Government's Title III Discovery, vol. XV, p. 497. He did not pay for the utilities, nor did he contribute to the rent. In sum, Segarra's allegations fail to create the impression that his interest in the apartment was anything other than that of an occasional guest, albeit a welcome guest, who used the premises in furtherance of alleged illegal activities. The Court concludes that *1265 the defendant's standing claim must therefore be denied.
SO ORDERED.
NOTES
[1] The defendant explicitly relies on the affidavits of agent Neil P. Cronin to establish that he indeed visited the apartment. Motion to Suppress Physical Evidence Seized Pursuant to a Search, filed [on behalf of defendant Juan Segarra Palmer] December 22, 1986, exhibit 1, p. 2. See Affidavit Regarding Standing of Defendant Juan Enrique Segarra Palmer, filed February 17, 1987, p. 2 (claiming reliance on Government statements to support his standing claims).
[2] See Ruling on the Defendants' "Standing" to Challenge the Admissibility of Evidence Seized at Suite 301, 210 Ponce de Leon Avenue, signed June 3, 1987.
[3] Compare these cases with United States v. Guerrero, 756 F.2d 1342, 1348 n. 2 (9th Cir. 1984), cert. denied, 469 U.S. 934, 105 S.Ct. 334, 83 L.Ed.2d 270 (1984) (defendant found to have standing to challenge the search of his host's home "by reason of his status as an overnight guest ... when the search occurred"); United States v. Salvador, 740 F.2d 752, 755 n. 2 (9th Cir.1984), cert. denied, 469 U.S. 1196, 105 S.Ct. 978, 83 L.Ed.2d 980 (1985) (overnight guest found to have standing to challenge the search of their hosts' home); United States v. Robertson, 606 F.2d 853, 858 n. 2 (9th Cir.1979) (defendant found to have standing to challenge the search of a friend's residence where he was an overnight guest). The Court expressly declines to follow the precedent of the Ninth Circuit in this regard. See Ruling on the Defendants' "Standing" to Challenge the Admissibility of Evidence Seized at Suite 301, 210 Ponce de Leon Avenue, signed June 3, 1987.
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NONPRECEDENTIAL DISPOSITION
To be cited only in accordance with Fed. R. App. P. 32.1
United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Submitted September 2, 2015*
Decided September 9, 2015
Before
DIANE P. WOOD, Circuit Judge
RICHARD A. POSNER, Circuit Judge
ILANA DIAMOND ROVNER, Circuit Judge
No. 14-3492
THOMAS L. BURSE, Appeal from the United States District
Plaintiff-Appellant, Court for the Eastern District of Wisconsin.
v. No. 13-C-804
MARK GOTTLIEB, et al., William E. Callahan, Jr.,
Defendants-Appellees. Magistrate Judge.
No. 15-1649
THOMAS L. BURSE, Appeal from the United States District
Defendant-Appellant, Court for the Eastern District of Wisconsin.
v. No. 13-C-1200
STATE OF WISCONSIN, Lynn Adelman,
Plaintiff-Appellee. Judge.
* After examining the briefs and record, we have concluded that oral argument is
unnecessary. Thus the appeal is submitted on the briefs and record. See FED. R. APP. P.
34(a)(2)(C).
No. 14-3492 & 15-1649 Page 2
ORDER
We have consolidated these two appeals for disposition. Both cases arose after the
Wisconsin Department of Transportation discovered that Thomas Burse, a state
contractor, falsified his education qualifications on his resume and overbilled the
Department by $ 1.3 million. The Department suspended (and eventually barred) him
from the state’s Disadvantaged Business Enterprise (DBE) program, terminated his state
contracts, and withheld payments to Burse in order to mitigate its losses. This forced
Burse and his business into bankruptcy, where the state of Wisconsin filed an adversary
proceeding under 11 U.S.C. § 523(a)(2)(A). That statute prevents discharge of debts
obtained through fraud, and the state invoked it to prevent Burse from discharging
through bankruptcy the $882,000 he still owed to the state. The bankruptcy court ruled
that the debt was non-dischargeable, the district court affirmed, and in the first of these
two consolidated appeals (No. 15-1649) we affirm as well. In a separate suit, the second
of our two appeals (No. 14-3492), Burse alleges that he was deprived of his due process
rights when he was suspended from the DBE program without a pre-suspension
hearing. The district court granted summary judgment for the defendants, and because
Burse received all the process that he was due, we affirm that judgment as well.
The DBE program aims to boost state contracts awarded to businesses with socially
and economically disadvantaged owners who meet state qualifications. Burse and his
construction-management company, Buveck, began to participate in Wisconsin’s DBE
program in 2003, but in 2010 the state found two problems with his participation. The
first was that Burse had lied about his educational background. In one resume Burse
asserted that he had earned an engineering degree from Illinois State University, but in
another he claimed to have an engineering degree from Bradley University. After the
state asked Burse to verify his Bradley degree, he twice provided forged transcripts, and
Bradley University later reported that Burse was not a graduate. The second problem
was with overbilling. An audit in 2010 revealed that Burse was billing for the same work
twice, inflating the number of hours employees worked, and exaggerating their rate of
hourly pay. In the auditor’s opinion, the sheer number of “mistakes” in the records
combined with evidence of forged employee signatures on timesheets and unauthorized
changes to timesheets established that Burse had committed fraud.
After uncovering these two problems, the state sent Burse notice on October 14, 2011,
that it was suspending him as a contractor. The notice informed him of the reasons that
the state had found fraud and overbilling and that Burse owed the state $882,528.24
because of his overbilling. The state also notified him that it would not approve him for
new transportation contracts during the suspension, it was posting his name on the
No. 14-3492 & 15-1649 Page 3
published list of suspended contractors, and it was reviewing his current contracts to
determine whether they would be terminated. The state gave him a prompt opportunity
for a hearing—fifteen days later—to contest the suspension, but Burse requested and
received longer—to November 25—to respond. During the next month the state
provided Burse’s attorney examples of the fraud uncovered in the audit and offered
Burse a chance to submit rebuttal evidence. Burse never responded with any exculpatory
evidence. His attorney merely asserted that the state had not specified the grounds for
suspension and supplied only limited proof of the audit’s findings or Burse’s
involvement in the problems identified in the audit. On December 1, the state barred
Burse and his company from future transportation contracts and terminated the
contracts on his current projects.
Burse filed for bankruptcy, and in an adversary proceeding the state claimed that
Burse’s debt to the state was obtained through fraud and could not be discharged. The
bankruptcy court held a trial at which the auditor testified that the widespread
overstatements in Burse’s company records could not be attributed to mere negligence.
The bankruptcy judge did not believe Burse’s response that he did not know that the
invoices and timesheets overstated billings. The judge observed that Burse signed many
of the falsified timesheets, Burse oversaw his company’s billing practices, and his
company had a pattern of creating false time sheets and bills. The bankruptcy court
therefore found fraud and ruled that the debt was not dischargeable. Burse appealed to
the district court, which affirmed the bankruptcy court’s ruling.
In the first appeal, Burse challenges the bankruptcy court’s ruling. Our review
focuses on the bankruptcy court’s rulings, rather than those of the district court, and we
review its factual findings for clear error and legal conclusions de novo. See In re
marchFIRST, Inc., 573 F.3d 414, 416 (7th Cir. 2009). To prove that a debt is
non-dischargeable because of fraud, a creditor must prove by a preponderance of
evidence that “(1) the debtor made a false representation or omission, (2) that the debtor
(a) knew was false or made with reckless disregard for the truth and (b) was made with
the intent to deceive, (3) upon which the creditor justifiably relied.” Ojeda v. Goldberg, 599
F.3d 712, 716–17 (7th Cir. 2010).
Burse points to nothing that calls the bankruptcy court’s ruling into question. As to
the first element, Burse does not challenge that the invoices and timesheets contained
false representations. On the second element, Burse contends only that no “direct”
evidence made him responsible for the “mistakes” that lead to the overbilling. But the
bankruptcy judge was entitled to rely on circumstantial evidence, which showed that, by
signing inflated timesheets and overseeing a billing system that regularly overcharged
No. 14-3492 & 15-1649 Page 4
the state, Burse knew about the falsehoods and intended to deceive the state. See Matter
of Sheridan, 57 F.3d 627, 633 (7th Cir. 1995). For the final element, Burse seems to argue
that the state was not justified in relying on his falsified resume for his DBE certification
because DBE regulations do not require a college degree. But the non-dischargeable debt
stems from the intentional overbilling, not the DBE certification. True, the bankruptcy
judge said that, “arguably, under that premise [that the resume fraud led to an
undeserved DBE certification], every dollar that Buvek collected when it acted as a DBE
sub should be non-dischargeable.” But the bankruptcy judge recognized that the state
was not asking for repayment of “every” dollar, but rather only the debts from the
overbilling. Accordingly, the fraud and non-dischargeability rulings were proper, so we
affirm the first judgment.
The second appeal arises from Burses’s separate suit alleging that his seven-week
suspension violated his procedural rights. In it he raises two claims that he continues to
pursue on appeal. First, he contends that the state violated due process by suspending
him and withholding contract payments before it gave him a chance to refute the
charges. The district court rejected this claim. It accepted that Burse was deprived of
property interests in the form of both a continued contractual relationship and contract
payments. But in light of the state’s significant interest in preventing fraud, the minimal
risk of an erroneous suspension based on the audit, and the prompt opportunity to
oppose the suspension, Burse received due process. The court also rejected Burse’s
second claim, which is that by publicizing his suspension the state defamed him in
violation of due process. The judge explained that Burse identified no “lost
opportunities” because of the posting.
On appeal Burse maintains that the state violated due process by denying him a
hearing before it suspended him. To prevail on this due process claim, Burse must show
that the state deprived him of a protected interest and that the procedures it used did not
comply with minimum due process requirements. See Hinkle v. White, No. 14-2254, 2015
WL 4297887, at *2 (7th Cir. July 16, 2015). The defendants concede that Burse had a
protected interest before it suspended him, so all that we must decide is what process
Burse was due. A pre-deprivation hearing is not always required; the need for one
depends on the balance “between the benefits and costs of such process.” Siebert v.
Severino, 256 F.3d 648, 659 (7th Cir. 2001) (quoting Penn Cent. Corp. v. U.S. R.R. Vest Corp.,
955 F.2d 1158, 1163 (7th Cir. 1992)). The three relevant considerations are: (1) the private
interest that will be affected, (2) the risk of an erroneous deprivation, and (3) the
government interest. See Mathews v. Eldridge, 424 U.S. 319, 335 (1976).
No. 14-3492 & 15-1649 Page 5
Balancing these three considerations, we conclude that Burse had no right to
pre-suspension process. Burse has a strong interest in receiving payments for past work
and continuing his contractual relationship with the state. But the seven-week
suspension limited only Burse’s ability to enter into new state contracts. The state
terminated his existing contracts only after his debarment, which occurred after he was
offered a full hearing, the adequacy of which Burse does not challenge. The second and
third considerations outweigh Burse’s private interest. The government has a substantial
interest in protecting taxpayers from fraudulent billing. And the risk of an erroneous
suspension was low because the audit, its findings, and the pre-suspension investigation
established reasonable grounds to believe Burse had defrauded the state. Those findings
obviated the need for a pre-suspension hearing. See Barry v. Barchi, 443 U.S. 55, 64–65
(1979) (a pre-deprivation hearing was unnecessary for suspending horse-racing license
because the suspension was based on probable cause). Furthermore Burse received
immediate notice of the suspension and a prompt opportunity to contest the suspension.
These added procedures supplied whatever process he was due.
Burse also repeats his claim that, by publishing his name on the list of suspended
contractors, the state harmed his reputation and thereby violated due process. A
defamation claim ground in due process requires some showing that the defamatory
statements “alter[ed] or extinguish[ed] a right or status recognized by state law.“ Santana
v. Cook County Bd. of Review, 679 F.3d 614, 621 (7th Cir. 2012) (quoting Brown v. Michigan
City Ind., 462 F.3d 720, 730 (7th Cir. 2006)). As the district court correctly pointed out,
Burse identified no situation in which a prime contractor ended or refused to enter into a
contract because of the posting. Any contracts that Burse lost directly with the state
resulted from his suspension, not the posting. The district court thus properly granted
summary judgment for the defendants in the second case.
AFFIRMED.
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832 F.2d 1265
U.S.v.Stevenson*
NO. 86-5674
United States Court of Appeals,Eleventh Circuit.
OCT 23, 1987
1
Appeal From: S.D.Fla.
2
AFFIRMED.
*
Fed.R.App.P. 34(a); 11th Cir.R. 23
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"pile_set_name": "FreeLaw"
} |
(Slip Opinion) OCTOBER TERM, 2013 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.
SUPREME COURT OF THE UNITED STATES
Syllabus
REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE SECOND CIRCUIT
No. 12–842. Argued April 21, 2014—Decided June 16, 2014
After petitioner, Republic of Argentina, defaulted on its external debt,
respondent, NML Capital, Ltd. (NML), one of Argentina’s bondhold-
ers, prevailed in 11 debt-collection actions that it brought against Ar-
gentina in the Southern District of New York. In aid of executing the
judgments, NML sought discovery of Argentina’s property, serving
subpoenas on two nonparty banks for records relating to Argentina’s
global financial transactions. The District Court granted NML’s mo-
tions to compel compliance. The Second Circuit affirmed, rejecting
Argentina’s argument that the District Court’s order transgressed
the Foreign Sovereign Immunities Act of 1976 (FSIA or Act).
Held: No provision in the FSIA immunizes a foreign-sovereign judg-
ment debtor from postjudgment discovery of information concerning
its extraterritorial assets. Pp. 4–12.
(a) This Court assumes without deciding that, in the ordinary case,
a district court would have the discretion under Federal Rule of Civil
Procedure 69(a)(2) to permit discovery of third-party information
bearing on a judgment debtor’s extraterritorial assets. Pp. 4–5.
(b) The FSIA replaced an executive-driven, factor-intensive, loosely
common-law-based immunity regime with “a comprehensive frame-
work for resolving any claim of sovereign immunity.” Republic of
Austria v. Altmann, 541 U. S. 677, 699. Henceforth, any sort of im-
munity defense made by a foreign sovereign in an American court
must stand or fall on the Act’s text. The Act confers on foreign states
two kinds of immunity. The first, jurisdictional immunity (28
U. S. C. §1604), was waived here. The second, execution immunity,
generally shields “property in the United States of a foreign state”
from attachment, arrest, and execution. §§1609, 1610. See also
§1611(a), (b)(1), (b)(2). The Act has no third provision forbidding or
2 REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD.
Syllabus
limiting discovery in aid of execution of a foreign-sovereign judgment
debtor’s assets. Far from containing the “plain statement” necessary
to preclude application of federal discovery rules, Société Nationale
Industrielle Aérospatiale v. United States Dist. Court for Southern
Dist. of Iowa, 482 U. S. 522, 539, the Act says not a word about
postjudgment discovery in aid of execution.
Argentina’s arguments are unavailing. Even if Argentina were
correct that §1609 execution immunity implies coextensive discovery-
in-aid-of-execution immunity, the latter would not shield from dis-
covery a foreign sovereign’s extraterritorial assets, since the text of
§1609 immunizes only foreign-state property “in the United States.”
The prospect that NML’s general request for information about Ar-
gentina’s worldwide assets may turn up information about property
that Argentina regards as immune does not mean that NML cannot
pursue discovery of it. Pp. 5–10.
695 F. 3d 201, affirmed.
SCALIA, J., delivered the opinion of the Court, in which ROBERTS,
C. J., and KENNEDY, THOMAS, BREYER, ALITO, and KAGAN, JJ., joined.
GINSBURG, J., filed a dissenting opinion. SOTOMAYOR, J., took no part in
the decision of the case.
Cite as: 573 U. S. ____ (2014) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports. Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Wash
ington, D. C. 20543, of any typographical or other formal errors, in order
that corrections may be made before the preliminary print goes to press.
SUPREME COURT OF THE UNITED STATES
_________________
No. 12–842
_________________
REPUBLIC OF ARGENTINA, PETITIONER v. NML
CAPITAL, LTD.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE SECOND CIRCUIT
[June 16, 2014]
JUSTICE SCALIA delivered the opinion of the Court.
We must decide whether the Foreign Sovereign Immu-
nities Act of 1976 (FSIA or Act), 28 U. S. C. §§1330, 1602
et seq., limits the scope of discovery available to a judg
ment creditor in a federal postjudgment execution pro
ceeding against a foreign sovereign.
I. Background
In 2001, petitioner, Republic of Argentina, defaulted on
its external debt. In 2005 and 2010, it restructured most
of that debt by offering creditors new securities (with less
favorable terms) to swap out for the defaulted ones. Most
bondholders went along. Respondent, NML Capital, Ltd.
(NML), among others, did not.
NML brought 11 actions against Argentina in the
Southern District of New York to collect on its debt, and
prevailed in every one.1 It is owed around $2.5 billion,
——————
1 The District Court’s jurisdiction rested on Argentina’s broad waiver
of sovereign immunity memorialized in its bond indenture agreement,
which states: “To the extent that [Argentina] or any of its revenues,
assets or properties shall be entitled . . . to any immunity from suit . . .
from attachment prior to judgment . . . from execution of a judgment or
2 REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD.
Opinion of the Court
which Argentina has not paid. Having been unable to
collect on its judgments from Argentina, NML has at
tempted to execute them against Argentina’s property.
That postjudgment litigation “has involved lengthy at
tachment proceedings before the district court and multi
ple appeals.” EM Ltd. v. Republic of Argentina, 695 F. 3d
201, 203, and n. 2 (CA2 2012) (referring the reader to prior
opinions “[f]or additional background on Argentina’s de
fault and the resulting litigation”).
Since 2003, NML has pursued discovery of Argentina’s
property. In 2010, “ ‘[i]n order to locate Argentina’s assets
and accounts, learn how Argentina moves its assets
through New York and around the world, and accurately
identify the places and times when those assets might be
subject to attachment and execution (whether under
[United States law] or the law of foreign jurisdictions),’ ”
id., at 203 (quoting NML brief), NML served subpoenas on
two nonparty banks, Bank of America (BOA) and Banco de
la Nación Argentina (BNA), an Argentinian bank with a
branch in New York City. For the most part, the two
subpoenas target the same kinds of information: docu
ments relating to accounts maintained by or on behalf of
Argentina, documents identifying the opening and closing
dates of Argentina’s accounts, current balances, transac
tion histories, records of electronic fund transfers, debts
owed by the bank to Argentina, transfers in and out of
Argentina’s accounts, and information about transferors
and transferees.
Argentina, joined by BOA, moved to quash the BOA
subpoena. NML moved to compel compliance but, before
——————
from any other legal or judicial process or remedy, . . . [Argentina] has
irrevocably agreed not to claim and has irrevocably waived such im
munity to the fullest extent permitted by the laws of such jurisdiction
(and consents generally for the purposes of the [FSIA] to the giving of
any relief or the issue of any process in connection with any Related
Proceeding or Related Judgment) . . . .” App. 106–107.
Cite as: 573 U. S. ____ (2014) 3
Opinion of the Court
the court ruled, agreed to narrow its subpoenas by exclud
ing the names of some Argentine officials from the ini-
tial electronic-fund-transfer message search. NML also
agreed to treat as confidential any documents that the
banks so designated.
The District Court denied the motion to quash and
granted the motions to compel. Approving the subpoenas
in principle, it concluded that extraterritorial asset discov
ery did not offend Argentina’s sovereign immunity, and it
reaffirmed that it would serve as a “clearinghouse for
information” in NML’s efforts to find and attach Argenti
na’s assets. App. to Pet. for Cert. 31. But the court made
clear that it expected the parties to negotiate further over
specific production requests, which, the court said, must
include “some reasonable definition of the information
being sought.” Id., at 32. There was no point, for in
stance, in “getting information about something that
might lead to attachment in Argentina because that would
be useless information,” since no Argentinian court would
allow attachment. Ibid. “Thus, the district court . . .
sought to limit the subpoenas to discovery that was rea
sonably calculated to lead to attachable property.” 695
F. 3d, at 204–205.
NML and BOA later negotiated additional changes to
the BOA subpoena. NML expressed its willingness to
narrow its requests from BNA as well, but BNA neither
engaged in negotiation nor complied with the subpoena.
Only Argentina appealed, arguing that the court’s order
transgressed the Foreign Sovereign Immunities Act be
cause it permitted discovery of Argentina’s extraterritorial
assets. The Second Circuit affirmed, holding that “be
cause the Discovery Order involves discovery, not attach
ment of sovereign property, and because it is directed at
third-party banks, not at Argentina itself, Argentina’s
sovereign immunity is not infringed.” Id., at 205.
We granted certiorari. 571 U. S. ___ (2014).
4 REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD.
Opinion of the Court
II. Analysis
A
The rules governing discovery in postjudgment execu
tion proceedings are quite permissive. Federal Rule of
Civil Procedure 69(a)(2) states that, “[i]n aid of the judg
ment or execution, the judgment creditor . . . may obtain
discovery from any person—including the judgment debtor—
as provided in the rules or by the procedure of the
state where the court is located.” See 12 C. Wright, A.
Miller, & R. Marcus, Federal Practice and Procedure
§3014, p. 160 (2d ed. 1997) (hereinafter Wright & Miller)
(court “may use the discovery devices provided in [the
federal rules] or may obtain discovery in the manner
provided by the practice of the state in which the district
court is held”). The general rule in the federal system is
that, subject to the district court’s discretion, “[p]arties
may obtain discovery regarding any nonprivileged matter
that is relevant to any party’s claim or defense.” Fed. Rule
Civ. Proc. 26(b)(1). And New York law entitles judgment
creditors to discover “all matter relevant to the satisfac
tion of [a] judgment,” N. Y. Civ. Prac. Law Ann. §5223
(West 1997), permitting “investigation [of] any person
shown to have any light to shed on the subject of the
judgment debtor’s assets or their whereabouts,” D. Siegel,
New York Practice §509, p. 891 (5th ed. 2011).
The meaning of those rules was much discussed at oral
argument. What if the assets targeted by the discovery
request are beyond the jurisdictional reach of the court to
which the request is made? May the court nonetheless
permit discovery so long as the judgment creditor shows
that the assets are recoverable under the laws of the
jurisdictions in which they reside, whether that be Florida
or France? We need not take up those issues today, since
Argentina has not put them in contention. In the Court of
Appeals, Argentina’s only asserted ground for objection to
Cite as: 573 U. S. ____ (2014) 5
Opinion of the Court
the subpoenas was the Foreign Sovereign Immunities Act.
See 695 F. 3d, at 208 (“Argentina argues . . . that the
normally broad scope of discovery in aid of execution is
limited in this case by principles of sovereign immunity”).
And Argentina’s petition for writ of certiorari asked us to
decide only whether that Act “imposes [a] limit on a United
States court’s authority to order blanket post-judgment
execution discovery on the assets of a foreign state used
for any activity anywhere in the world.” Pet. for Cert. 14.
Plainly, then, this is not a case about the breadth of Rule
69(a)(2).2 We thus assume without deciding that, as the
Government conceded at argument, Tr. of Oral Arg. 24,
and as the Second Circuit concluded below, “in a run-of
the-mill execution proceeding . . . the district court would
have been within its discretion to order the discovery from
third-party banks about the judgment debtor’s assets
located outside the United States.” 695 F. 3d, at 208. The
single, narrow question before us is whether the Foreign
Sovereign Immunities Act specifies a different rule when
the judgment debtor is a foreign state.
B
To understand the effect of the Act, one must know
something about the regime it replaced. Foreign sovereign
immunity is, and always has been, “a matter of grace and
comity on the part of the United States, and not a re
striction imposed by the Constitution.” Verlinden B. V. v.
Central Bank of Nigeria, 461 U. S. 480, 486 (1983). Ac
cordingly, this Court’s practice has been to “defe[r] to the
decisions of the political branches” about whether and
——————
2 On one of the final pages of its reply brief, Argentina makes for the
first time the assertion (which it does not develop, and for which it cites
no authority) that the scope of Rule 69 discovery in aid of execution is
limited to assets upon which a United States court can execute. Reply
Brief 19. We will not revive a forfeited argument simply because the
petitioner gestures toward it in its reply brief.
6 REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD.
Opinion of the Court
when to exercise judicial power over foreign states. Ibid.
For the better part of the last two centuries, the political
branch making the determination was the Executive,
which typically requested immunity in all suits against
friendly foreign states. Id., at 486–487. But then, in 1952,
the State Department embraced (in the so-called Tate
Letter) the “restrictive” theory of sovereign immunity,
which holds that immunity shields only a foreign sover
eign’s public, noncommercial acts. Id., at 487, and n. 9.
The Tate Letter “thr[ew] immunity determinations into
some disarray,” since “political considerations sometimes
led the Department to file suggestions of immunity in
cases where immunity would not have been available
under the restrictive theory.” Republic of Austria v. Alt
mann, 541 U. S. 677, 690 (2004) (internal quotation marks
omitted). Further muddling matters, when in particular
cases the State Department did not suggest immunity,
courts made immunity determinations “generally by refer
ence to prior State Department decisions.” Verlinden, 461
U. S., at 487. Hence it was that “sovereign immunity
decisions were [being] made in two different branches,
subject to a variety of factors, sometimes including diplo
matic considerations. Not surprisingly, the governing
standards were neither clear nor uniformly applied.” Id.,
at 488.
Congress abated the bedlam in 1976, replacing the old
executive-driven, factor-intensive, loosely common-law
based immunity regime with the Foreign Sovereign Im
munities Act’s “comprehensive set of legal standards
governing claims of immunity in every civil action against
a foreign state.” Ibid. The key word there—which goes a
long way toward deciding this case—is comprehensive. We
have used that term often and advisedly to describe the
Act’s sweep: “Congress established [in the FSIA] a com
prehensive framework for resolving any claim of sovereign
immunity.” Altman, 541 U. S., at 699. The Act “compre
Cite as: 573 U. S. ____ (2014) 7
Opinion of the Court
hensively regulat[es] the amenability of foreign nations to
suit in the United States.” Verlinden, supra, at 493. This
means that “[a]fter the enactment of the FSIA, the Act—
and not the pre-existing common law—indisputably gov
erns the determination of whether a foreign state is enti
tled to sovereign immunity.” Samantar v. Yousuf, 560
U. S. 305, 313 (2010). As the Act itself instructs, “[c]laims
of foreign states to immunity should henceforth be decided
by courts . . . in conformity with the principles set forth in
this [Act].” 28 U. S. C. §1602 (emphasis added). Thus, any
sort of immunity defense made by a foreign sovereign in
an American court must stand on the Act’s text. Or it
must fall.
The text of the Act confers on foreign states two kinds of
immunity. First and most significant, “a foreign state
shall be immune from the jurisdiction of the courts of the
United States . . . except as provided in sections 1605 to
1607.” §1604. That provision is of no help to Argentina
here: A foreign state may waive jurisdictional immunity,
§1605(a)(1), and in this case Argentina did so, see 695
F. 3d, at 203. Consequently, the Act makes Argentina
“liable in the same manner and to the same extent as a
private individual under like circumstances.” §1606.
The Act’s second immunity-conferring provision states
that “the property in the United States of a foreign state
shall be immune from attachment[,] arrest[,] and execu
tion except as provided in sections 1610 and 1611 of this
chapter.” §1609. The exceptions to this immunity defense
(we will call it “execution immunity”) are narrower. “The
property in the United States of a foreign state” is subject
to attachment, arrest, or execution if (1) it is “used for a
commercial activity in the United States,” §1610(a), and
(2) some other enumerated exception to immunity applies,
such as the one allowing for waiver, see §1610(a)(1)–(7).
The Act goes on to confer a more robust execution immu
nity on designated international-organization property,
8 REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD.
Opinion of the Court
§1611(a), property of a foreign central bank, §1611(b)(1),
and “property of a foreign state . . . [that] is, or is intended
to be, used in connection with a military activity” and is
either “of a military character” or “under the control of a
military authority or defense agency,” §1611(b)(2).
That is the last of the Act’s immunity-granting sections.
There is no third provision forbidding or limiting discovery
in aid of execution of a foreign-sovereign judgment debt
or’s assets. Argentina concedes that no part of the Act
“expressly address[es] [postjudgment] discovery.” Brief for
Petitioner 22. Quite right. The Act speaks of discovery
only once, in a subsection requiring courts to stay discov
ery requests directed to the United States that would
interfere with criminal or national-security matters,
§1605(g)(1). And that section explicitly suspends certain
Federal Rules of Civil Procedure when such a stay is
entered, see §1605(g)(4). Elsewhere, it is clear when the
Act’s provisions specifically applicable to suits against
sovereigns displace their general federal-rule counter
parts. See, e.g., §1608(d). Far from containing the “plain
statement” necessary to preclude application of federal
discovery rules, Société Nationale Industrielle Aérospatiale
v. United States Dist. Court for Southern Dist. of Iowa,
482 U. S. 522, 539 (1987), the Act says not a word on the
subject.3
Argentina would have us draw meaning from this si
lence. Its argument has several parts. First, it asserts
that, before and after the Tate Letter, the State Depart
ment and American courts routinely accorded absolute
execution immunity to foreign-state property. If a thing
belonged to a foreign sovereign, then, no matter where it
——————
3 Argentina and the United States suggest that, under the terms of
Rule 69 itself, the Act trumps the federal rules, since Rule 69(a)(1)
states that “a federal statute governs to the extent it applies.” But,
since the Act does not contain implicit discovery-immunity protections,
it does not “apply” (in the relevant sense) at all.
Cite as: 573 U. S. ____ (2014) 9
Opinion of the Court
was found, it was immune from execution. And absolute
immunity from execution necessarily entailed immunity
from discovery in aid of execution. Second, by codifying
execution immunity with only a small set of exceptions,
Congress merely “partially lowered the previously uncon
ditional barrier to post-judgment relief.” Brief for Peti
tioner 29. Because the Act gives “no indication that it was
authorizing courts to inquire into state property beyond
the court’s limited enforcement authority,” ibid., Argen
tina contends, discovery of assets that do not fall within an
exception to execution immunity (plainly true of a foreign
state’s extraterritorial assets) is forbidden.
The argument founders at each step. To begin with,
Argentina cites no case holding that, before the Act, a
foreign state’s extraterritorial assets enjoyed absolute
execution immunity in United States courts. No surprise
there. Our courts generally lack authority in the first
place to execute against property in other countries, so
how could the question ever have arisen? See Wright &
Miller §3013, at 156 (“[A] writ of execution . . . can be
served anywhere within the state in which the district
court is held”). More importantly, even if Argentina were
right about the scope of the common-law execution
immunity rule, then it would be obvious that the terms of
§1609 execution immunity are narrower, since the text of
that provision immunizes only foreign-state property “in
the United States.” So even if Argentina were correct that
§1609 execution immunity implies coextensive discovery
in-aid-of-execution immunity, the latter would not shield
from discovery a foreign sovereign’s extraterritorial assets.
But what of foreign-state property that would enjoy
execution immunity under the Act, such as Argentina’s
diplomatic or military property? Argentina maintains
that, if a judgment creditor could not ultimately execute a
judgment against certain property, then it has no business
pursuing discovery of information pertaining to that prop
10 REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD.
Opinion of the Court
erty. But the reason for these subpoenas is that NML does
not yet know what property Argentina has and where it is,
let alone whether it is executable under the relevant
jurisdiction’s law. If, bizarrely, NML’s subpoenas had
sought only “information that could not lead to executable
assets in the United States or abroad,” then Argentina
likely would be correct to say that the subpoenas were
unenforceable—not because information about nonexecut
able assets enjoys a penumbral “discovery immunity”
under the Act, but because information that could not
possibly lead to executable assets is simply not “relevant”
to execution in the first place, Fed. Rule Civ. Proc.
26(b)(1); N. Y. Civ. Prac. Law Ann. §5223.4 But of course
that is not what the subpoenas seek. They ask for infor
mation about Argentina’s worldwide assets generally, so
that NML can identify where Argentina may be holding
property that is subject to execution. To be sure, that
request is bound to turn up information about property
that Argentina regards as immune. But NML may think
the same property not immune. In which case, Argenti
na’s self-serving legal assertion will not automatically
prevail; the District Court will have to settle the matter.
* * *
Today’s decision leaves open what Argentina thinks is a
gap in the statute. Could the 1976 Congress really have
meant not to protect foreign states from postjudgment
——————
4 The dissent apparently agrees that the Act has nothing to say about
the scope of postjudgment discovery of a foreign sovereign’s extraterri
torial assets. It also apparently agrees that the rules limit discovery to
matters relevant to execution. Our agreement ends there. The dissent
goes on to assert that, unless a judgment creditor proves up front that
all of the information it seeks is relevant to execution under the laws of
all foreign jurisdictions, discovery of information concerning extraterri
torial assets is limited to that which the Act makes relevant to execu
tion in the United States. Post, at 2 (opinion of GINSBURG, J.). We can
find no basis in the Act or the rules for that position.
Cite as: 573 U. S. ____ (2014) 11
Opinion of the Court
discovery “clearinghouses”? The riddle is not ours to solve
(if it can be solved at all). It is of course possible that, had
Congress anticipated the rather unusual circumstances of
this case (foreign sovereign waives immunity; foreign
sovereign owes money under valid judgments; foreign
sovereign does not pay and apparently has no executable
assets in the United States), it would have added to the
Act a sentence conferring categorical discovery-in-aid-of
execution immunity on a foreign state’s extraterritorial
assets. Or, just as possible, it would have done no such
thing. Either way, “[t]he question . . . is not what Con
gress ‘would have wanted’ but what Congress enacted in
the FSIA.” Republic of Argentina v. Weltover, Inc., 504
U. S. 607, 618 (1992).5
Nonetheless, Argentina and the United States urge us
to consider the worrisome international-relations conse
quences of siding with the lower court. Discovery orders
as sweeping as this one, the Government warns, will cause
“a substantial invasion of [foreign states’] sovereignty,”
Brief for United States as Amicus Curiae 18, and will
“[u]ndermin[e] international comity,” id., at 19. Worse,
such orders might provoke “reciprocal adverse treatment
of the United States in foreign courts,” id., at 20, and will
“threaten harm to the United States’ foreign relations
more generally,” id., at 21. These apprehensions are
better directed to that branch of government with author-
ity to amend the Act—which, as it happens, is the same
branch that forced our retirement from the immunity-by
factor-balancing business nearly 40 years ago.6
——————
5 NML also argues that, even if Argentina had a claim to immunity
from postjudgment discovery, it waived it in its bond indenture agree
ment, see n. 1, supra. The Second Circuit did not address this argu
ment. Nor do we.
6 Although this appeal concerns only the meaning of the Act, we have
no reason to doubt that, as NML concedes, “other sources of law”
ordinarily will bear on the propriety of discovery requests of this nature
12 REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD.
Opinion of the Court
The judgment of the Court of Appeals is affirmed.
It is so ordered.
JUSTICE SOTOMAYOR took no part in the decision of this
case.
——————
and scope, such as “settled doctrines of privilege and the discretionary
determination by the district court whether the discovery is warranted,
which may appropriately consider comity interests and the burden that
the discovery might cause to the foreign state.” Brief for Respondent
24–25 (quoting Société Nationale Industrielle Aérospatiale v. United
States Dist. Court for Southern Dist. of Iowa, 482 U. S. 522, 543–544,
and n. 28 (1987)).
Cite as: 573 U. S. ____ (2014) 1
GINSBURG, J., dissenting
SUPREME COURT OF THE UNITED STATES
_________________
No. 12–842
_________________
REPUBLIC OF ARGENTINA, PETITIONER v. NML
CAPITAL, LTD.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE SECOND CIRCUIT
[June 16, 2014]
JUSTICE GINSBURG, dissenting.
The Foreign Sovereign Immunities Act of 1976, 28
U. S. C. §§1330, 1602 et seq., if one of several conditions is
met, permits execution of a judgment rendered in the
United States against a foreign sovereign only on “property
in the United States . . . used for a commercial activity.”
§1610(a). Accordingly, no inquiry into a foreign sover-
eign’s property in the United States that is not “used for a
commercial activity” could be ordered; such an inquiry,
as the Court recognizes, would not be “ ‘relevant’ to execu-
tion in the first place.” Ante, at 10 (citing Fed. Rule Civ.
Proc. 26(b)(1)). Yet the Court permits unlimited inquiry
into Argentina’s property outside the United States,
whether or not the property is “used for a commercial
activity.” By what authorization does a court in the United
States become a “clearinghouse for information,” ante,
at 3 (internal quotation marks omitted), about any and all
property held by Argentina abroad? NML may seek such
information, the Court reasons, because “NML does not yet
know what property Argentina has [outside the United
States], let alone whether it is executable under the rele-
vant jurisdiction’s law.” Ante, at 10. But see Société
Nationale Industrielle Aérospatiale v. United States Dist.
Court for Southern Dist. of Iowa, 482 U. S. 522, 542 (1987)
(observing that other jurisdictions generally allow much
2 REPUBLIC OF ARGENTINA v. NML CAPITAL, LTD.
GINSBURG, J., dissenting
more limited discovery than is available in the United
States).
A court in the United States has no warrant to indulge
the assumption that, outside our country, the sky may be
the limit for attaching a foreign sovereign’s property in
order to execute a U. S. judgment against the foreign
sovereign. Cf. §1602 (“Under international law, . . . th[e]
commercial property [of a state] may be levied upon for the
satisfaction of judgments rendered against [the state] in
connection with [its] commercial activities.” (emphasis
added)). Without proof of any kind that other nations
broadly expose a foreign sovereign’s property to arrest,
attachment or execution, a more modest assumption is in
order. See EM Ltd. v. Republic of Argentina, 695 F. 3d
201, 207 (CA2 2012) (recognizing that postjudgment dis-
covery “must be calculated to assist in collecting on a
judgment” (citing Fed. Rules Civ. Proc. 26(b)(1), 69(a)(2))).
Unless and until the judgment creditor, here, NML,
proves that other nations would allow unconstrained
access to Argentina’s assets, I would be guided by the one
law we know for sure—our own. That guide is all the
more appropriate, as our law coincides with the interna-
tional norm. See §1602. Accordingly, I would limit NML’s
discovery to property used here or abroad “in connection
with . . . commercial activities.” §§1602, 1610(a). I there-
fore dissent from the sweeping examination of Argentina’s
worldwide assets the Court exorbitantly approves today.
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178 F.3d 473
PRUDENTIAL INSURANCE COMPANY OF AMERICA and Boston MutualLife Insurance Company, Plaintiffs,v.Chrystal ATHMER, a minor, and Geneva Athmer, individuallyand as guardian of Chrystal Athmer, Defendants-Appellants,v.Steven M. Hill, Jr., a minor, and Betty Jo Pierce,individually and as guardian for Steven M. Hill,Jr., Defendants-Appellees.
No. 98-4043.
United States Court of Appeals,Seventh Circuit.
Argued April 12, 1999.Decided May 14, 1999.
Richard J. Pautler, Thompson & Coburn, St. Louis, MO, argued, for Plaintiffs.
Steven E. Katzman, John F. Pawloski (argued), Katzman & Mack, Belleville, IL, for Defendants-Appellants.
Mary M. Brauer (argued), Cook, Shevlin, Keefe, Ysursa, Brauer & Bartholomew, Belleville, IL; John J. O'Gara, Jr., Belleville, IL, for Defendants-Appellees.
Before POSNER, Chief Judge, and EASTERBROOK and DIANE P. WOOD, Circuit Judges.
POSNER, Chief Judge.
1
A pair of insurance companies brought this interpleader action to determine who should receive the proceeds of two life insurance policies owned by a man who was murdered by his wife. The contenders are the victim's natural daughter, and the murderess's natural son and sister. Upon stipulated facts, the district judge rendered judgment for the latter two, and the daughter appeals.
2
Kevin Spann, a soldier in the U.S. Army, was the insured. Prudential had issued him a life insurance policy pursuant to the Servicemen's Group Life Insurance Act of 1965 (SGLI), 38 U.S.C. §§ 1965 et seq., for $200,000 in 1992 when he was stationed in Germany. The policy named Spann's wife, Gina Spann, as primary beneficiary and Gina's natural son, Steven Hill, as contingent or secondary beneficiary. Steven was 13 and had been living with Kevin and Gina throughout the eleven years of their marriage. The other policy, which was for $100,000, had been issued in 1994, also in Germany, by Boston Mutual. This policy also named Gina as primary beneficiary, but it named her sister, Betty Jo Pierce, rather than Steven, as the contingent beneficiary, and it was not issued under SGLI. Neither policy mentioned Chrystal Athmer, Kevin Spann's natural daughter. He had never lived with her or even acknowledged the relationship, which was established by DNA testing after his death. In his will Spann devised his estate to Steven, describing him as "my son."
3
At the time of his death in 1997, Spann was a permanent resident of Illinois but was stationed in Georgia. His wife had him murdered there by her 18-year-old lover and three of his 16-year old pals. She pleaded guilty to the murder and was sentenced to life in prison without parole plus five additional years (as the district judge judiciously put it, "the State of Georgia even tacked an additional five years onto that already lengthy sentence"). She no longer has custody of her son. In fact, as Steven's lawyer explained without contradiction, "the whole family is estranged from her. The sister [Betty Jo Pierce] didn't have anything to do with her. They've been trying to get Kevin away from her for years. Gina is somewhere else." The sister is Steven's legal guardian, and has instituted a proceeding to adopt him; neither was complicit in Kevin Spann's murder. Gina is conceded to be disqualified from taking anything under the life insurance policies. The question is whether Steven and his aunt are also disqualified. The district judge held not.
4
There is an initial issue, not adequately dealt with by the parties or the district judge, concerning choice of law. The insurance policies were issued in Germany to a citizen of Illinois. We assume that Kevin Spann was a citizen of Illinois at the time because he was when he died and because the policies list an Illinois address as his permanent mailing address; on the special rules governing the domicile of members of the armed forces, see Restatement (Second) of Conflicts § 17, comment d and illustration 1 (1971). The beneficiaries named in the life insurance policies, Steven and his aunt, are (and, we assume, were) also citizens of Illinois. But the controversy over entitlement to the proceeds was precipitated by a murder in Georgia.
5
The choice of law issue must be analyzed separately for each policy. The cases say or imply that when a question relating to the interpretation and administration of an insurance policy issued under the authority of the servicemen's insurance statute arises that is not answered by the statute itself, then as with other government contracts, e.g., Boyle v. United Technologies Corp., 487 U.S. 500, 504-05, 108 S.Ct. 2510, 101 L.Ed.2d 442 (1988), the answer is to be supplied by federal common law. Rollins v. Metropolitan Life Ins. Co., 863 F.2d 1346 (7th Cir.1988); Prudential Ins. Co. v. King, 453 F.2d 925, 931 (8th Cir.1971); cf. Ridgway v. Ridgway, 454 U.S. 46, 59-60, 102 S.Ct. 49, 70 L.Ed.2d 39 (1981); Metropolitan Life Ins. Co. v. Christ, 979 F.2d 575 (7th Cir.1992); Prudential Ins. Co. v. Tull, 690 F.2d 848 (4th Cir.1982) (per curiam); but see Emard v. Hughes Aircraft Co., 153 F.3d 949, 959-60 (9th Cir.1998) (dictum). Since the concept of "federal common law" is nebulous when a statute is in the picture, it might be better to jettison the concept in that context and say simply that in filling gaps left by Congress in a federal program the courts seek to effectuate federal policies. Burks v. Lasker, 441 U.S. 471, 476-77, 99 S.Ct. 1831, 60 L.Ed.2d 404 (1979); Ivey v. Harney, 47 F.3d 181, 183-84 (7th Cir.1995). SGLI is a federal program; in fact, technically the government rather than the serviceman is the policyholder. 38 U.S.C. § 1966; Ridgway v. Ridgway, supra, 454 U.S. at 51. The government's concern with beneficiary issues is shown by SGLI's detailed provisions concerning who the beneficiary is if the policy doesn't say, 38 U.S.C. § 1970(a), although the contingency of a beneficiary's murdering the insured is not addressed. As we have both a government contract and a federal statute (we might have the government contract yet only a procedural issue not governed by a statute, or at least by the statute authorizing the contract), the case for using federal law to answer the question of who is to receive the proceeds of the insurance policy is compelling.
6
Often a court asked to fill a gap in a federal statute will do so by borrowing a state's common law, e.g., Atherton v. FDIC, 519 U.S. 213, 224-25, 117 S.Ct. 666, 136 L.Ed.2d 656 (1997), because in most areas of the law state common law is more highly developed than federal. Steffes v. Stepan Co., 144 F.3d 1070, 1074 (7th Cir.1998); Baravati v. Josephthal, Lyon & Ross, 28 F.3d 704, 707 (7th Cir.1994). But borrowing state law would be a mistake in the case of soldiers' life insurance policies. Frequently as in this case the policy is issued wherever the soldier happens to be stationed when thoughts of mortality assail him. Although soldiers generally designate a U.S. state as their domicile, their connection with that state is often tenuous until retirement. It would be arbitrary to subject issues arising under the policy to the law of a particular state. Better that these policies should be governed by a uniform set of rules untethered to any particular jurisdiction. Prudential Ins. Co. v. Tull, supra; Prudential Ins. Co. v. King, supra, 453 F.2d at 931; cf. United States v. Kimbell Foods, Inc., 440 U.S. 715, 728, 99 S.Ct. 1448, 59 L.Ed.2d 711 (1979); Commonwealth Edison Co. v. Vega, 174 F.3d 870 (7th Cir.1999). Congress's desire for uniformity is reflected in the statute's detailed provision mentioned earlier regarding who shall receive the proceeds if a beneficiary is not named.
7
The principle that no person shall be permitted to benefit from the consequences of his or her wrongdoing has long been applied to disqualify murderers from inheriting from their victims, whether the route of inheritance is a will, an intestacy statute, or a life insurance policy. E.g., Mutual Life Ins. Co. v. Armstrong, 117 U.S. 591, 600, 6 S.Ct. 877, 29 L.Ed. 997 (1886); Riggs v. Palmer, 115 N.Y. 506, 22 N.E. 188 (N.Y.1889); Swietlik v. United States, 779 F.2d 1306 (7th Cir.1985); see annotations at 25 A.L.R.4th 787 (1981 & 1998 Supp.), 27 A.L.R.3d 794 (1970 & 1997 Supp.). It is undoubtedly an implicit provision of the Servicemen's Group Life Insurance Act of 1965, Prudential Ins. Co. v. Tull, supra, and it disqualifies Gina Spann from receiving any of the proceeds of Kevin's SGLI policy, even though she is the primary beneficiary named in it.
8
The usual consequence when a primary beneficiary disclaims or is forced to disclaim an interest under an insurance policy, will, pension plan, or other such instrument is that the contingent beneficiary takes in the place of the primary one. And this is the approach that a majority of courts take when the beneficiary is disqualified by reason of having murdered his benefactor. E.g., Lee v. Aylward, 790 S.W.2d 462 (Mo.1990); Spencer v. Floyd, 30 Ark.App. 230, 785 S.W.2d 60 (Ark.App.1990); Seidlitz v. Eames, 753 P.2d 775 (Colo.App.1987); National Home Life Assurance Co. v. Patterson, 746 P.2d 696 (Okl.App.1987). (There is a slew of minority rules, see Annot., 26 A.L.R.2d 987 (1952 & 1998 Supp.); Lee R. Russ & Thomas F. Segalla, Couch on Insurance, § 62:19 (3d ed.1997)--which is a good reason for having a uniform federal rule for SGLI policies.) We take it, although the case law is sparse, that if the contingent beneficiary is himself a wrongdoer and his wrongdoing contributed to the death of his benefactor, as where the contingent beneficiary is the accomplice of the primary beneficiary in the benefactor's murder, the same rule that disqualifies the primary beneficiary disqualifies the contingent beneficiary. In re Estate of Vallerius, 259 Ill.App.3d 350, 196 Ill.Dec. 341, 629 N.E.2d 1185, 1188 (Ill.App.1996). We are surprised that Reynolds v. American-Amicable Life Ins. Co., 591 F.2d 343 (5th Cir.1979) (per curiam), allowed an accessory after the fact to inherit.
9
But this leaves the case in which the primary beneficiary may derive an indirect benefit if the contingent beneficiary (assumed to be completely innocent) is allowed to obtain the benefits. Estate of Vallerius is the plainest illustration: the grandchildren murdered their grandmother, who had left her estate to their (innocent) mother, who died, having devised her estate, now including the grandmother's money, to her children--the murderers. They were, of course, barred from taking under their mother's will. Subtler cases of indirect benefit can be imagined. Suppose that Steven Hill (the murderess's son and victim's stepson) were an adult and he promised that he would use the life insurance proceeds to pay for his mother's lawyer or to buy her books or other goods that the prison would allow her to receive. Or suppose that Steven needed an expensive operation that Kevin could not or would not pay for and Gina killed Kevin so that the proceeds of his life insurance could be used to pay for the operation; or that Gina had been given a short prison sentence and Kevin had promised to support her in style out of the life insurance proceeds when she was released. The lawyer for Steven and Betty Jo argued to us that the fulfillment of such a promise would be barred by the "murdering heir" rule itself, but that is not correct. The rule forbids the murderer to take under the will or other instrument; it does not impress on the benefits a kind of reverse constructive trust placing them forever beyond the murderer's reach.
10
These cases can be multiplied indefinitely. Some states have decided that the best way to deal with them and make utterly certain that the murderer does not profit from his crime is to disqualify all the murderer's relatives, except his or her children if they are also the victim's children. E.g., Ga. Stat. 53-4-64(c); Crawford v. Coleman, 726 S.W.2d 9 (Tex.1987). Under that rule, Steven and Betty Jo would be disqualified. We need not decide whether that is or should be the federal common law rule governing murders by beneficiaries of Servicemen's Group Life Insurance policies, because Chrystal, the daughter, the party who would benefit from such a rule, does not advocate a uniform federal rule. She argues for the rule of the insured's domicile, here Illinois. Steven and Betty Jo argue for a uniform federal rule, not a borrowed state rule--a uniform rule that does not cut out the murderer's bloodline, that instead requires proof that the murderer will in fact benefit if the contingent beneficiary is allowed to take in the murderer's place. We could turn the tables on Steven and Betty Jo and say, yes, we agree with you that a uniform federal rule is desirable, but we don't like your rule; we like the rule that would entitle the natural daughter to a victory in this suit. But we do not reverse judgments in civil cases on the basis of grounds not argued by the appellant at any stage of the litigation--grounds, therefore, that the appellee had no opportunity to meet. See, for the general principle, Cosgrove v. Bartolotta, 150 F.3d 729, 735 (7th Cir.1998), and for its application to murdering-heir cases, Reynolds v. American Amicable Life Ins. Co., supra, 591 F.2d at 344.
11
The life insurance policy issued by Boston Mutual was not issued under the aegis of the Servicemen's Group Life Insurance Act, and so federal common law is not in the picture. The choice of law rule of the forum state, that is, Illinois, must therefore be used to determine which jurisdiction shall supply the rule of decision. Klaxon v. Stentor Electric Mfg. Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941). In the case of life insurance, that rule picks the law of the state where the insured was domiciled when the policy was applied for, hence in this case Illinois, unless some other state has a more significant relationship. That at any rate is the rule of the Second Restatement, see section 192 (and note that comment b to that section confirms Kevin Spann's status as an Illinois domiciliary), which Illinois follows. Ingersoll v. Klein, 46 Ill.2d 42, 262 N.E.2d 593 (Ill.1970); Spinozzi v. ITT Sheraton Corp., 174 F.3d 842, ---- (7th Cir.1999). (Section 192 itself is cited approvingly in Hofeld v. Nationwide Life Ins. Co., 59 Ill.2d 522, 322 N.E.2d 454, 458 (Ill.1975).) But one could argue, consistent with the principle--which is a principle of Illinois law--that the law of the place of the tort is the presumptive or default rule of choice of law in tort cases, Spinozzi v. ITT Sheraton Corp., supra, 1999 WL 177503, at * 2, that the law of Georgia should govern this case instead. For it was a tort, namely the wrongful death that Gina Spann inflicted on her husband, that is the basis for refusing to enforce the contract as written. Georgia has the paramount interest in deciding whether to refuse to enforce a contract as a means of increasing the punishment for a murder committed in Georgia. But just to show how complicated choice of law analysis can be, we point out that arguably what is at stake in "murdering heir" cases is donative intent rather than deterrence. Deterrence of murdering heirs is a legitimate concern, given the number of murders by spouses and children (more than 1,000 in 1997, see FBI, Uniform Crime Reports for the United States 1997 21 (1998) (tab.2.12)), but could be achieved by imposing on the murderer a fine equal to the amount he inherited from his victim. Even so, the victim would not have made the murderer his heir (or the beneficiary of his life insurance policy) had he known what the future held. E.g., Misenheimer v. Misenheimer, 312 N.C. 692, 325 S.E.2d 195, 198 (N.C.1985); State Farm Life Ins. Co. v. Pearce, 234 Cal.App.3d 1685, 286 Cal.Rptr. 267, 273 (Cal.App.1991); but cf. Lee v. Aylward, 790 S.W.2d 462, 463 (Mo.1990). And if this is the important thing it would point us back toward Illinois.
12
Neither side argues for the application of German law. Although that is where the contracts were made, the parties to the contracts had only the most adventitious connection to Germany and it is highly doubtful that they contemplated the application of German law to any dispute under the policy that might arise. Spinozzi v. ITT Sheraton Corp., supra, 1999 WL 177503, at * 3. The choice is thus between Illinois and Georgia.
13
Both states have "slayer statutes," but they are not the same. The Illinois statute forbids the murderer to "receive any property, benefit or other interest by reason of the death [of the murderer's victim], whether as heir, legatee, beneficiary ... or in any other capacity," and provides that if the murderer is disqualified, the property, etc. shall "pass as if the person causing the death died before the decedent." 755 ILCS 5/2-6. Judicial interpretation has established that the statute is applicable to life insurance. State Farm Life Ins. Co. v. Davidson, 144 Ill.App.3d 1049, 99 Ill.Dec. 139, 495 N.E.2d 520 (Ill.App.1986); Eskridge v. Farmers New World Life Ins. Co., 250 Ill.App.3d 603, 190 Ill.Dec. 295, 621 N.E.2d 164, 169 (Ill.App.1993). Georgia has a statute that deals expressly with murder by the beneficiary of a life insurance policy, and provides that in such a case the property goes to the secondary beneficiary if one is named in the policy. Ga.Code Ann. § 33-25-13. So the Illinois statute defines "benefit" broadly enough to encompass cases of indirect benefit such as we posited earlier, while the Georgia statute, read literally, allows no room for such consideration. This creates a tension with Georgia's will statute, which, as noted earlier, absolutely excludes the murderer's family, provided there is no blood relationship between them and the victim.
14
Kevin Spann's daughter pitches her appeal with regard to both policies on cases interpreting the Illinois statute, and since those cases do not carry the day for her, we have no need to delve into Georgia case law, and anyway we cannot find any relevant cases. The daughter relies primarily on a case in which an Illinois court refused to allow the children of a convicted murderess to take under the victim's will. In re Estate of Mueller, 275 Ill.App.3d 128, 211 Ill.Dec. 657, 655 N.E.2d 1040 (Ill.App.1995). As in this case, the victim was the murderess's husband and the children were hers, not his. But Chrystal has missed the real significance of Estate of Mueller. What it shows is that Illinois does not cut off the murderess's bloodline regardless of circumstances. The court thought it important that the murderess had already been released from prison and had custody of one of her children (the other was an adult) and that the marriage had been a sham and the children had not lived with her husband. Id. at 1043, 1046. It was quite likely in these circumstances that the murderess would benefit if her husband's bequest went to the children; indeed, it was almost certain so far as the bequest to the younger child was concerned, since she was living with her murderous mom.
15
Estate of Mueller suggests that Illinois "murdering heir" case law requires the trial court to make a factual determination whether allowing a relative of the murderer to take in the place of the murderer is likely to confer a significant benefit on him. Estate of Vallerius, discussed earlier, is consistent with that approach (see also State Farm Mutual Life Ins. Co. v. Pearce, supra, 286 Cal.Rptr. at 273), and we cannot find any contrary precedent in Illinois. Which is not to say that it is necessarily the best approach. Rejected by many states, see, e.g., Lee v. Aylward, supra, 790 S.W.2d at 463; Neff v. Massachusetts Mutual Life Ins. Co., 158 Ohio St. 45, 107 N.E.2d 100 (Ohio 1952); In re Estate of Benson, 548 So.2d 775, 777 (Fla.App.1989), it requires an inherently speculative judgment about the future and an investigation of family relations quite likely to be of Faulknerian opacity, but it is Illinois's approach and we are bound by it. It is the approach followed by the district judge, and, as should be apparent from the stipulated facts sketched at the outset of this opinion, the conclusion he reached cannot be adjudged clearly erroneous. It is exceedingly unlikely that Gina Spann will ever benefit significantly from the proceeds of her husband's life insurance policies in the hands of her son and her sister.
16
But we do not think the judge was right to place any weight on the tenuousness of Chrystal's claim to any place in her father's affections. The question of indirect benefit to the murderer is the focus of inquiry under Illinois law as we understand it and it is unaffected by the victim's affection for the person who will take under the will or the insurance policy if the named beneficiary is disqualified. Compare Bennett v. Allstate Ins. Co., 317 N.J.Super. 324, 722 A.2d 115, 117-18 (N.J.Super.1998). The "person" could be the state under an escheat statute, so far as anything to do with the policy behind Illinois's murdering-heir rule is concerned. But we do not think the judge's decision would have been different had he ignored the affective dimensions of Chrystal's relationship with her father; his emphasis was quite properly on the remoteness of Gina's prospects for ever deriving any benefit from the life insurance policies.
17
AFFIRMED.
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STATE OF VERMONT
SUPERIOR COURT ENVIRONMENTAL DIVISION
Docket No. 140-11-15 Vtec
Rublee 246 White Birch Lane CU DECISION ON THE MERITS
This matter concerns an application by Appellant Lynn Rublee for conditional use approval
to use part of her single-family home at 246 White Birch Lane in the Town of Derby, Vermont
(Town) as a bed and breakfast. Ms. Rublee submitted her conditional use application to the Town
Development Review Board (DRB), and the DRB reviewed Ms. Rublee’s application under the six
conditional use criteria in Section 208.4 of the Town of Derby Zoning Bylaw (Bylaws). The DRB
determined that the conditional use would not have an undue adverse effect on existing or
planned community facilities, renewable energy resources, or the Town’s Bylaws, satisfying three
requirements of Section 208.4. The DRB denied the conditional use application, finding that the
bed and breakfast would have an adverse impact on the character of the area; area roads and
highways; and the public health, safety, and welfare.
Ms. Rublee appealed that determination to this Court.1 Several Neighbors—Troy
Schumacher, Deborah Brooks, Peter Brooks, Mark Rublee, Jacques Dupont, Charles Curtiss,
Nancy Curtiss, and Marina Dupuy—appeared as self-represented interested parties. The Town
also appeared through Attorney Amanda Lafferty. Ms. Rublee filed an initial Statement of
Questions on December 14, 2015, then amended her Statement of Questions on January 11,
2016 and again on January 21, 2016. Her final Statement of Questions had seven questions with
various subparts.
In a status conference on February 22, 2016, the Court dismissed Questions 1 and 7. At
an April 18, 2016 status conference, the Court granted Ms. Rublee’s motion to withdraw
Questions 3(A), 4(A), 4(B), and 5(A). Remaining before the Court are Questions 2, 3, 4, and 5,
1
In the initial stages of this matter, Ms. Rublee was self-represented. Prior to the February 22, 2016 status
conference, Ms. Rublee retained Attorney Chad Hickey to represent her in this matter.
1
which ask, respectively, whether the bed and breakfast satisfies conditional use standards;
whether it will have an undue adverse effect on the character of the area; whether it will have
an undue adverse effect on area roads and highways; and whether it will have an undue adverse
effect on the public health, safety, and welfare.
The Court held a site visit and one-day merits hearing in this matter on July 13, 2016. The
hearing was held at the Vermont Superior Court for Orleans County in Newport, Vermont.
Several days before the hearing, all self-represented interested parties except Marina Dupuy and
Mark Rublee withdrew from the matter. Participating were Lynn Rublee, represented by Chad
Hickey, Esq. and the Town of Derby, represented by Amanda Lafferty, Esq. Mark Rublee attended
the site visit and hearing, but did not actively participate. Marina Dupuy did not attend the site
visit or hearing.
Based on the evidence submitted at trial, which was put into context by the site visit, the
Court makes the following findings of fact and conclusions of law.
Findings of Fact
1. Appellant Lynn Rublee lives at 246 White Birch Lane in the Town of Derby, Vermont.
2. Ms. Rublee purchased her single-family home at 246 White Birch Lane in 2013. The home
has three bedrooms and 1¾ baths. Ms. Rublee lives in the home year round.
3. The house is located in the Town’s Shoreland District and is adjacent to Lake
Memphremagog.
4. Ms. Rublee began operating a bed and breakfast in July 2015 by renting two of the three
bedrooms in her house through the website AirBnB. Ms. Rublee did not believe she needed Town
approval for AirBnB rentals.
5. Sometime in late summer or fall of 2015, the Town zoning administrator informed her
that she need a permit to rent rooms through AirBnB. She ceased renting in October 2015 while
she applied for Town approval.
6. Ms. Rublee applied for conditional use approval, and the DRB denied her application on
October 26, 2015.
7. Ms. Rublee appealed that decision to this Court.
2
8. On appeal, Ms. Rublee seeks conditional use approval to operate a two-room bed and
breakfast at her property.
9. Ms. Rublee’s bed and breakfast would house up to four guests per night.
10. Ms. Rublee generally has a positive relationship with her renters. They are typically quiet
and respectful.
11. Ms. Rublee’s guests generally seek accommodations while they vacation in the area.
Some of her renters are from out of state, some are Vermonters from other parts of the state.
I. Character of the Area
12. Ms. Rublee’s property is Lot 9 of a ten-lot subdivision that received an Act 250 permit in
1983 (the Subdivision).
13. After the initial Act 250 permit, two of the lots in the Subdivision were further subdivided
into four lots, totaling twelve lots in the Subdivision.
14. The Subdivision is bordered by North Derby Road to the east and Lake Memphremagog
to the west.
15. The lots in the Subdivision have access to North Derby Road via White Birch Lane, which
runs west from North Derby Road through the subdivision and terminates at the Rublee lot.
16. The traveled portion of the White Birch Lane right-of-way is 11 feet wide.
17. All residents of the Subdivision share general maintenance costs, and year-round
residents share the costs of winter maintenance.
18. There are presently seven homes in the twelve-lot Subdivision.
19. Four homes—the Stratton, Stanley, Brooks, and Rublee homes—are used as primary
residences. They are occupied year-round or nearly year-round.
20. Two homes—the Curtiss and Dupuy homes—are second homes; they are not occupied
year round. The Dupuy home is occasionally rented to friends and family.
21. One home—the Penney property—is rented to various people year round. The house is
3,000 square feet, and it sleeps up to ten people. Ms. Rublee has seen up to five cars parked on
the Penney lot at a time.
22. Five lots have no homes on them.
3
23. One of these five lots is owned by Jacques Dupont, who puts a mobile trailer on his lot in
the summer months. Another is owned by the Smiths, who do the same. A third is owned by
the Brookses. This lot adjoins the Brookses’ house, and is vacant. The fourth is owned by the
Strattons. This lot adjoins the Strattons’ house, and is vacant. The fifth is owned by the Penney
family. This lot lies across a small lane from the other Penney lot (the lot with the Penney home
on it), and it is also vacant.
24. Ms. Rublee’s lot is bordered by White Birch Lane to the south and a former railroad line
to the west.
25. The railroad line has been converted into a rail trail that runs from Newport to the
Canadian border. It is open for recreational use. Motorized vehicles are prohibited. The rail trail
is heavily used in the area near the Subdivision.
26. Lake Mephremagog lies to the west of the rail trail. Ms. Rublee leases a sand beach on
Lake Memphremagog from the State of Vermont. She also leases a strip of land that crosses the
rail trail and connects her lot to the beach.
27. There is another portion of beach on Lake Memphremagog that is open for use by some
residents of the Subdivision.
28. Immediately to the south of the Subdivision is a vacation area known as Cousins Beach.
29. The Cousins Beach area is made up of sixteen small cottages that are used during the
summer months.
30. Approximately five of these cottages are open to the general public as rental properties.
31. Cousins Beach residents use the beach area just south of the Subdivision’s beach area.
32. Cousins Lane connects the Cousins Beach area to North Derby Road. Cousins Lane is
parallel to White Birch Lane. A strip of land about twenty-five feet wide separates the two roads.
33. Cars traveling up and down Cousins Lane can be viewed from many of the residences on
White Birch Lane.
34. During the winter months, there is a Vermont Association of Snowmobile Travelers (VAST)
snowmobile trail that comes across North Derby Road at an angle, travels across a field to the
south of Cousins Lane, then crosses Cousins Lane at a point near the Brooks residence. The trail
4
then travels down Cousins Lane and across Lake Memphremagog. The trail is heavily traveled in
winter when snow covered.
II. Traffic
35. Ms. Rublee seeks approval to rent two of the three bedrooms in her house on a nightly
basis.
36. Historically, she has rented her rooms for about ten nights per month, on average.
37. Guests typically take one or two round trips a day by vehicle away from the residence
(totaling two or four one-way trips).
38. The sole access road for Ms. Rublee’s house is White Birch Lane.
39. White Birch Lane runs from Ms. Rublee’s house east to North Derby Road. At North Derby
Road, White Birch Lane forms a “T” intersection. There are no intersection or stopping sight
distance problems at the North Derby Road/White Birch Lane intersection.
40. From North Derby Road, White Birch Lane is flat and straight for roughly 100 feet. It then
dips down at a grade of 10 to 15% for the next 100 feet, after which it levels off and curves to the
right (north) and approaches Ms. Rublee’s house.
41. The posted speed limit for White Birch Lane is 10 miles per hour on the flat portion of the
road and 5 miles per hour on the incline.
42. When cars on the road meet, one car has to move over to pass.
43. Cars have been safely using this system since 1983.
44. Many more cars use Cousins Lane than White Birch Lane to access North Derby Road.
Cousins Lane is the same width as White Birch Lane.
45. The first 100 feet of White Birch Lane is in good condition, but there is a lack of crown in
the road on the incline portion, which is causing water to stagnate and erode the roadway.
46. Ms. Rublee hired an engineering consultant to evaluate the condition of her road.
47. The road consultant recommends adding a gravel crown of 3–4% to address the drainage
issue.
48. The road erosion problems on this portion of the road are longstanding. The additional
traffic generated by Ms. Rublee’s proposed bed and breakfast will have a negligible effect on the
road.
5
III. Public Health, Safety, and Welfare
49. Ms. Rublee’s home has a septic system. She received a certificate of compliance from the
State of Vermont Agency of Environmental Conservation for her septic system.
50. Bed and breakfasts are subject to certain fire and food regulations.
51. Ms. Rublee has been in contact with the Town fire marshal, and has arranged to do what
the marshal requires to comply with fire code.
52. Ms. Rublee prepares continental breakfast for her renters, but it does not involve cooking.
Ms. Rublee gives out kitchen privileges to guests on an as-needed basis.
53. Ms. Rublee is generally on-site while renters are there. She is responsible for ensuring
guest safety.
Conclusions of Law
Ms. Rublee seeks conditional use approval for operation of a bed and breakfast out of her
home in the Town of Derby’s Shoreland District. Under the Town of Derby’s Zoning Bylaw
(Bylaws),2 conditional use applicants must demonstrate that their uses will not have undue
adverse effects on: (1) the capacity of community facilities; (2) the character of the area; (3)
traffic; (4) the Town’s Bylaws; (5) renewable energy resources; and (6) the general public health,
safety, and welfare. Bylaws § 208.4(A)–(F).
The DRB found that the bed and breakfast would not have an undue adverse effect on
elements 1, 4, and 5. No one appealed those determinations, and they are therefore final. The
issues before the Court, which are raised in Ms. Rublee’s Statement of Questions, are whether
the bed and breakfast will have an undue adverse effect on the character of the area; traffic on
roads and highways in the vicinity; and the general public health, safety, and welfare.
I. Character of the Area (Question 3)
The first issue is whether the bed and breakfast will have an undue adverse effect on the
character of the area. See Bylaws § 208.4(B). There was some dispute in pre-trial motions, at
trial, and in the post-trial briefs over the proper standard for evaluating the character of the area.
We will address these legal arguments first, then apply the standard to Ms. Rublee’s application.
2
Admitted at trial as Exhibit 10.
6
a. Legal Standard for “Character of the Area”
The Town’s conditional use standards provide that conditional uses must not adversely
affect “the character of the area involved.” Bylaws § 208.4(B). The statute empowering towns
to regulate conditional uses provides that towns’ conditional use standards
[S]hall require that the proposed conditional use shall not result in an undue adverse
effect on . . . the character of the area affected, as defined by the purpose or purposes of
the zoning district within which the project is located, and specifically stated policies and
standards of the municipal plan.
24 V.S.A. § 4414(3)(A)(ii) (emphasis added).
The Town argues that the emphasized language in the statute means that the only
permissible metric for determining the “character of the area” is purpose statements in town
plans and bylaws. At trial, the Town therefore objected to evidence of existing uses in the
Shoreland District, and it urges us to ignore this evidence in our decision. Ms. Rublee, on the
other hand, argues that the statutory standard for conditional uses is merely a “floor” for
municipal regulations, and that Towns are free to pass more restrictive standards. It argues that
the Town has done so here, and that its Bylaws require conditional uses to harmonize with both
purpose statements and existing uses.
We agree with Mr. Rublee’s interpretation of the bylaw and the statute. The statutory
language in 24 V.S.A. § 4414 sets a “floor” for municipalities’ conditional use regulations, but it
does not displace the requirements of municipal bylaws. See In re Hurricane Auto CU Permit,
No. 92-7-11 Vtec, slip op. at 5 (Vt. Super. Ct. Envtl. Div. Oct. 12, 2012) (Walsh, J.) (quoting In re
White, 155 Vt. 612, 619–20 (1991)). While towns’ regulations must, at the very least, ensure that
conditional uses will not have an undue adverse effect on the character of the area “as defined
by the purpose or purposes of the zoning district,” the regulations may also require that
conditional uses not have an undue adverse effect on the character of the area as it actually
exists. See, e.g., id.; In re Twin Pines Housing Trust Conditional Use, No. 95-7-77 Vtec, slip op. at
10 (Vt. Envtl. Ct. Sept. 20, 2012) (examining a conditional use bylaw requiring conformity with
purpose statements and existing uses).
Before 2004, the statute empowering towns to regulate conditional uses provided only
that towns’ conditional use standards “shall require that the proposed conditional use shall not
7
adversely affect . . . the character of the area affected.” See 2004, No. 115, § 109, codified at 24
V.S.A. § 4414(3)(A)(ii). The Legislature added the language defining “character of the area” by
“the purpose or purposes of the zoning district” in 2004 as part of the Permit Reform Act. See
id. The 2004 amendments gave towns until September 1, 2011 to amend their bylaws to
“conform with the provisions of this chapter.” See 2004, No. 115, §§ 95, 109, codified at 24 V.S.A.
§§ 4414(3), 4481.
The Town of Derby’s Bylaws use the language from the pre-2004 statute, and simply
provide that conditional uses must not “adversely affect . . . the character of the area involved.”3
Bylaws § 208.4(B). The Town amended its Bylaws after 2011, and its decision to keep the broader
language from the pre-2004 statute presumably represents a conscious choice not to restrict the
definition of “character of the area” to just purpose statements, and to maintain the pre-2004
meaning of “character of the area.” See Robes v. Town of Hartford, 161 Vt. 187, 193 (1993)
(“[W]e presume that the legislature chose its words advisedly.”).
The meaning of “character of the area” before the 2004 amendments was the character
of the area as it actually exists, rather than as it is defined in the abstract. See, e.g., In re Licausi,
No. 203-11-98 Vtec, slip op. at 2 n.2 (Vt. Envtl. Ct. Nov. 4, 2005) (Wright, J.), aff’d 182 Vt. 647
(noting that, because the 2004 amendments were not applicable to the application before the
Court, “character of the area remains assessed as including the working landscape as the area
currently exists, with all approved uses.”). Cf. In re Meaker, 156 Vt. 182, 185 (1991); In re
Gaboriault, 167 Vt. 582, 584–85 (1997); In re Miller, 170 Vt. 64, 69 (1999); In re Sardi, 170 Vt.
623, 625 (2000) (all affirming character-of-the-area reviews in which the lower court examined
existing uses).
We have looked to existing uses to determine character of the area in virtually every post-
2004 conditional use case involving bylaws that, like the Town’s, maintain the pre-2004 statutory
language. In re Mansfield Prof. Bldg. PRD Final Plat Application, No. 260-11-07 Vtec, slip op. at
14–15 (Vt. Envtl. Ct. Dec. 9, 2008) (Durkin, J.); In re Woodstock Cmty. Trust, No. 203-10-09 Vtec,
3
The Bylaws are not invalid for failing to update the conditional use provisions after 2004. The 2004
amendments required that towns amend their bylaws to “conform” to the new statute by September 1, 2011. 24
V.S.A. § 4481. As we discuss in this opinion, the Bylaws do conform, since they comply with the statutory floor in 24
V.S.A. § 4414(3).
8
slip op. at 13–15 (Vt. Super. Ct. Envtl. Div. Oct. 14, 2011) (Wright, J.); In re Champlain Oil
Conditional Use Application, No. 89-7-11 Vtec, slip op. at 7–8, 34 (Vt. Super. Ct. Envtl. Div. Oct.
10, 2012) (Durkin, J.), aff’d 2014 VT 19, 196 Vt. 29; In re Grp. Five Invs. CU Permit, No. 34-3-11
Vtec, slip op. at 13 (Vt. Super. Ct. Envtl. Div. Oct. 24, 2012) (Durkin, J.), aff’d 2014 VT 14, 195 Vt.
625; In re Whiteyville Props., LLC, No. 179-12-11 Vtec, slip op. at 9–10 (Vt. Super. Ct. Envtl. Div.
Dec. 19, 2013) (Durkin, J.); In re Zaremba Grp. Dollar General CU Permit, No. 32-3-14 Vtec, slip
op. at 11–15 (Vt. Super Ct. Envtl. Div. Dec. 22, 2014) (Walsh, J.); In re Margaret Pratt Assisted
Living Site Plan, Conditional Use and Act 250 Approvals, Nos., 111-8-14 Vtec, 112-8-14 Vtec, 13-
2-15 Vtec, and 100-8-15 Vtec, slip op. at 15 (Vt. Super. Ct. Envtl. Div. June 21, 2016) (Durkin, J.).4
We have even looked to existing uses when reviewing conditional uses under bylaws that mimic
the post-2004 statutory language, defining “character of the area” by purpose statements in
town plans and bylaws. See In re Willowell Found. CU, No. 142-10-12 Vtec, slip op. at 3, 22 (Vt.
Super. Ct. Envtl. Div. July 10, 2014) (Walsh, J.), aff’d 2016 VT 12.
Nothing in the conditional use statute prohibits the Town from carrying forward the pre-
2004 meaning of “character of the area,” provided its bylaws also require harmony with purpose
statements in town plans and bylaws. See In re Hurricane Auto CU Permit, No. 92-7-11 Vtec, slip
op. at 5 (Vt. Super. Ct. Envtl. Div. Oct. 12, 2012) (Walsh, J.) (quoting In re White, 155 Vt. 612, 619–
20 (1991)). Furthermore, even when a bylaw does not satisfy the “floor” in the conditional use
statute, the Court will simply read the required statutory standards into the ordinance, and treat
the bylaws as an additional restriction. In re White, 155 Vt. 612, 620 (1990).
4
In In re Zaremba Grp. Dollar General CU Permit, an on-the-record appeal, the DRB interpreted a bylaw
identical to the Bylaws in this case to be “synonymous” with the statute. No. 32-3-14 Vtec at 11 (Dec. 22, 2014).
We affirmed that legal conclusion, but we also affirmed the DRB’s factual findings comparing the proposed
conditional uses to existing uses in the area. Id. at 12–15.
In In re Mansfield Professional Building and In re Woodstock Community Trust, we analyzed bylaws identical
to the Bylaws in this case, but suggested that, under 24 V.S.A. § 4414, the only gauge for character of the area is
purpose statements in town plans and bylaws. In re Mansfield Prof. Bldg. PRD Final Plat Application, No. 260-11-07
Vtec, slip op. at 14–15 (Vt. Envtl. Ct. Dec. 9, 2008) (Durkin, J.); In re Woodstock Cmty. Trust, No. 203-10-09 Vtec, slip
op. at 13–15 (Vt. Super. Ct. Envtl. Div. Oct. 14, 2011) (Wright, J.). Despite this suggestion, we ultimately looked to
existing uses to support our character-of-the-area analysis in both cases. Mansfield, No. 260-11-07 Vtec at 14–15
(Dec. 9, 2008); Woodstock, No. 203-10-09 Vtec at 13–15 (Oct. 14, 2011).
9
We therefore interpret the Bylaws’ character-of-the-area standard to mean that
proposed conditional uses in the Town must harmonize with existing uses and with purpose
statements in the town Bylaws and plan. The Town’s Bylaws therefore require conditional uses
to satisfy a two-prong test: if a proposed conditional use will have an undue adverse impact on
either existing uses or a purpose statement, it will fail conditional use review.
Reading between the lines of the Town’s argument, the Town is concerned that, by
allowing evidence of existing uses to come in at trial, the Court might approve conditional uses
that harmonize with existing uses, even if it does not comply with purpose statements for the
district. But, under our two-pronged interpretation, a conditional use that harmonized with
existing uses but did not comply with a purpose statement would not receive conditional use
approval. This interpretation is actually stricter than the interpretation the Town offers, because
conditional uses must satisfy two requirements instead of one.
Our interpretation is also stricter because purpose statements in town plans and bylaws
are often broad and aspirational; they do not offer concrete standards to measure conditional
uses against. We have held that it is permissible to require conditional uses to comply with broad,
aspirational purpose statements, even when those purpose statements are the kind of
“nongregulatory abstractions” we would refuse to enforce directly. See In re Gilmore LLC 5-Lot
Subdivision Conditional Use Application, No. 131-8-10 Vtec, slip op. at 11 & n.8 (Vt. Super. Ct.
Envtl. Div. Feb. 9, 2012) (citing In re JAM Golf, LLC, 2008 VT 110, ¶¶ 14, 16–17, 185 Vt. 201). But
the task of measuring proposed uses against broad standards is still a difficult one,5 and it is rare
that a conditional use actually fails under the purpose prong of character-of-the-area review.
Looking to existing uses in addition to purpose statements is therefore sound regulatory policy.
It gives teeth to the character-of-the-area requirement, and it gives reviewing tribunals—and
applicants—concrete standards to measure proposed uses against.
5
Two of our cases discussed in footnote 5—In re Mansfield Professional Building PRD Final Plat
Application and In re Woodstock Community Trust—illustrate this difficulty. In both cases, we suggested that, after
the 2004 amendments, the only permissible metric for “character of the area” is purpose statements in town plans
and bylaws. In re Mansfield Prof. Bldg. PRD Final Plat Application, No. 260-11-07 Vtec, slip op. at 14–15 (Vt. Envtl.
Ct. Dec. 9, 2008) (Durkin, J.); In re Woodstock Cmty. Trust, No. 203-10-09 Vtec, slip op. at 13–15 (Vt. Super. Ct. Envtl.
Div. Oct. 14, 2011) (Wright, J.). But then, in both cases, our analysis ends up referencing existing uses for support,
likely because there is so little to analyze when comparing a proposed use to broad, aspirational purpose statements.
See Mansfield, No. 260-11-07 Vtec at 14–15 (Dec. 9, 2008); Woodstock, No. 203-10-09 Vtec at 13–15 (Oct. 14, 2011).
10
We therefore conclude that, in the Town of Derby, conditional uses must not adversely
affect the character of the area, as it is defined in the Bylaws or as it exists in reality. We will
therefore compare Ms. Rublee’s bed and breakfast to both the purpose statement for the
Shoreland District and the existing uses in the area.
b. Whether Ms. Rublee’s Bed and Breakfast Will Have an Undue Adverse Effect on
Character of the Area
Ms. Rublee’s bed and breakfast will not have an undue adverse effect on the character
of the area, as defined either by the purpose statement of the Shoreland District or the existing
uses in the area.
The Bylaws express the following purpose for the Shoreland District:
[T]o provide for the protection of public waters, control of water pollution, preservation
of shore cover and natural beauty, and for the maintenance of safe and healthful
conditions which will provide for multiple uses of waters in a manner that provides for
the best interest of the citizens of the state. As such, the location and setbacks of septic
tanks and leach fields are regulated in addition to any state regulations that may apply.
Bylaws § 206.9 (expressing the “objective” for the zoning district). This purpose does not
provide any specific or concrete prohibition. It merely reflects an attempt to balance
conservation of shore land and “multiple uses of waters,” and it references regulations regarding
septic tanks.
To the extent this purpose statement imposes enforceable limits on conditional uses in
the Shoreland District, Ms. Rublee’s bed and breakfast is within these limits. Her bed and
breakfast involves no new construction, and it will be a low-impact way of increasing access to
the water while at the same time conserving open space. She has the necessary state permits
for her septic tank, and there was no suggestion that her septic tank violated municipal
standards. We cannot say that the bed and breakfast will upset the balance between
conservation and recreation envisioned for the Shoreland District, or that Ms. Rublee’s bed and
breakfast will have an undue adverse effect on this purpose.
We also conclude that Ms. Rublee’s bed and breakfast will be consistent with existing uses
in the area. The Shoreland District contains a mix of year-round homes, seasonal second homes,
and short-term vacation rentals. It is also heavily used as a recreational area: people walk and
bike on the Lamoille Valley rail trail, boat on Lake Memphremagog, and snowmobile on the VAST
11
snowmobile trail that crosses Cousens Lane. According to Ms. Rublee, her guests are generally
quiet and respectful, and are simply interested in using the area to recreate. We therefore
conclude that Ms. Rublee’s small-scale bed and breakfast is not substantially different than other
uses in the area, and will suit the existing character of the Shoreland District.
Because we find that Ms. Rublee’s bed and breakfast is consistent with the stated purpose
of the Shoreland District and that it will complement the existing uses in the area, we answer
Question 3 by concluding that Ms. Rublee’s proposed bed and breakfast will not have an undue
adverse effect on the character of the area.
II. Traffic (Question 4)
The next issue is whether Ms. Rublee’s bed and breakfast will have an undue adverse
effect on traffic on roads and highways in the vicinity. See Bylaws § 208.4(C). The roads leading
to White Birch Lane are all large enough that the additional traffic from a two-room bed and
breakfast will have little to no impact on them. White Birch Lane is a narrow dirt road. It is not
wide enough for two cars to pass, but, on the rare instances when two cars do meet head on,
one is able to pull over to allow the other to pass. This system has worked in the past on White
Birch Lane and on the nearby Cousins Lane, which is the same width and which has significantly
more traffic. The Court therefore concludes that the bed and breakfast will not have an adverse
impact on traffic safety on White Birch Lane or the surrounding roads.
With regard to road maintenance, White Birch Lane is in good condition for the first
hundred feet, but there is a longstanding erosion issue on the inclined portion of the road. The
cause of this problem is that the road lacks a crown in this portion, which causes water to
concentrate and erode the roadway. Ms. Rublee’s expert found, however, that a two-room bed
and breakfast would have negligible impact on this underlying problem, and the Court finds this
assessment credible. We therefore conclude that, Ms. Rublee’s bed and breakfast will not have
an undue adverse effect on area roads, thus answering Question 4.6
6
Ms. Rublee testified at trial that she is willing to work with her neighbors to fund road improvements, but
that she does not think it is fair to have the road improvements connected to this application, since the road issues
are longstanding and the bed and breakfast will have a negligible impact on the road. The Court agrees that it would
be unfair to require Ms. Rublee to remedy the preexisting road problems as a condition of this approval when the
bed and breakfast did not cause and will not exacerbate the poor road conditions.
12
III. Public Health, Safety, and Welfare (Question 5)
The final issue is whether the proposed bed and breakfast will have an undue adverse
effect on the public health, safety, and welfare. See Bylaws § 208.4(F). Ms. Rublee testified that
her experiences with guests have all been positive, that her guests are generally quiet and
respectful, and that she is responsible for ensuring safety while guests are staying in her home.
She has also taken the necessary steps to ensure fire and food safety at her property. There was
no other evidence or offer that the bed and breakfast would have an undue adverse effect on
the public health, safety, and welfare. We therefore conclude that her project satisfies this
criterion, thus answering Question 5.
Conclusion
The Court concludes that Ms. Rublee’s application for conditional use approval for a two-
bedroom bed and breakfast at her property on 246 White Birch Lane will not have an undue
adverse effect on the character of the area; traffic; or the public health, safety, and welfare. We
therefore conclude that Ms. Rublee’s application satisfies the conditional use standards at issue
in this appeal, thus answering Questions 2 - 5, and we GRANT Ms. Rublee’s application for
conditional use approval.
A judgment order accompanies this merits decision. This concludes the matter before
the Court.
Electronically signed on August 23, 2016 at 10:41 AM pursuant to V.R.E.F. 7(d).
_________________________________________
Thomas G. Walsh, Judge
Superior Court, Environmental Division
13
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FILED
United States Court of Appeals
Tenth Circuit
March 21, 2013
UNITED STATES COURT OF APPEALS
Elisabeth A. Shumaker
Clerk of Court
TENTH CIRCUIT
TRAVIS RASHAD BARNES,
Petitioner-Appellant,
v.
No. 12-1371
WARDEN JOHN DAVIS, Warden; (D.C. No. 1:11-CV-02760-REB)
THE ATTORNEY GENERAL OF (D. Colo.)
THE STATE OF COLORADO,
Respondents-Appellees.
ORDER DENYING CERTIFICATE
OF APPEALABILITY *
Before BRISCOE, Chief Judge, McKAY and HOLMES, Circuit Judges.
Petitioner-Appellant Travis Rashad Barnes, a prisoner in Colorado state
custody, proceeding pro se, 1 seeks a certificate of appealability (“COA”) to
challenge the district court’s denial of his application for a writ of habeas corpus
pursuant to 28 U.S.C. § 2254. Mr. Barnes also seeks leave to proceed in forma
pauperis. Having thoroughly reviewed the relevant law and the record, we deny
*
This order is not binding precedent except under the doctrines of law
of the case, res judicata and collateral estoppel. It may be cited, however, for its
persuasive value consistent with Federal Rule of Appellate Procedure 32.1 and
Tenth Circuit Rule 32.1.
1
Because Mr. Barnes is proceeding pro se, we construe his filings
liberally. See Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per curiam); Garza v.
Davis, 596 F.3d 1198, 1201 n.2 (10th Cir. 2010).
Mr. Barnes’s application for a COA, deny his request to proceed in forma
pauperis, and dismiss this matter.
I
Mr. Barnes was convicted by a jury in Denver County District Court of two
counts of first-degree murder. He was sentenced to two consecutive life terms in
prison without parole. The Colorado Court of Appeals affirmed the judgment
against Mr. Barnes on direct appeal. The Colorado Supreme Court denied
certiorari.
Subsequently, Mr. Barnes filed a post-conviction motion in state trial court
pursuant to Rule 35(c) of the Colorado Rules of Criminal Procedure, collaterally
attacking the judgment against him. The trial court denied the motion, the
Colorado Court of Appeals affirmed this denial, and the Colorado Supreme Court
denied certiorari.
Mr. Barnes then filed a pro se Application for Writ of Habeas Corpus
pursuant to 28 U.S.C. § 2254. In his application, Mr. Barnes asserted three
claims: (1) the trial court violated his Sixth Amendment confrontation rights by
allowing the prosecution to present hearsay evidence without calling the out-of-
court declarant as a witness; (2) trial counsel was ineffective for failing to object
and renew his motion for a mistrial after the prosecution rested without calling
the out-of-court declarant as a witness; and (3) direct appeal counsel was
ineffective for failing to properly raise the Confrontation Clause claim on direct
-2-
appeal.
Each claim arises from the direct examination of Mr. Barnes’s girlfriend at
trial. Specifically, the prosecutor asked the girlfriend whether she recalled telling
her friend that she was afraid that her boyfriend, Mr. Barnes, would break in
through her window. See R. at 443–44 (Order on Appl. for Writ of Habeas
Corpus, dated Sept. 6, 2012) (quoting the relevant colloquy between the
prosecutor and Mr. Barnes’s girlfriend). Mr. Barnes’s trial counsel objected and
moved for mistrial—notably, just once—arguing that the prosecutor was trying to
introduce hearsay without having the friend testify; 2 the prosecutor responded that
the questions were necessary to lay the foundation for impeaching the girlfriend’s
2
In considering the viability of a Confrontation Clause claim, we note
some lack of clarity as to whether a hearsay statement of Mr. Barnes’s girlfriend
was actually admitted into evidence, although it appears that only the prosecutor
injected the statement in his examination of the girlfriend. Compare R. at 443
(“Q: Specifically, . . . do you recall telling [the friend], . . . , that night, that you
were afraid of your boyfriend coming in the window?” (alterations in original)),
with id. at 111–12 (Opening Br. of Def.-Aplt., filed Nov. 29, 2011) (referring to
“improper prosecutorial questioning that elicited inadmissible [hearsay]
evidence”). However, as noted infra, the Colorado Court of Appeals resolved the
Confrontation Clause question on the basis of whether the statement was
testimonial. Consequently, we also direct our focus to that question and need not
definitively opine on whether the statement was actually hearsay and admitted
into evidence. See id. at 448 (“[T]he Colorado Court of Appeals concluded that
the prosecutor’s reference to the girlfriend’s statement did not violate the
Confrontation Clause because it was not testimonial.” (citation omitted) (internal
quotation marks omitted)). Cf. Littlejohn v. Trammell, 704 F.3d 817, 838 (10th
Cir. 2013) (“Despite his oblique references to the Confrontation Clause, Mr.
Littlejohn does not actually claim that such a violation took place—only that the
prosecutor’s ‘comments were akin to a violation of the Confrontation Clause.’”
(quoting Aplt. Littlejohn’s Opening Br. at 51)).
-3-
testimony with the friend’s testimony, and the trial court overruled trial counsel’s
objection.
The State contended, and the district court agreed, that Mr. Barnes’s first
claim for relief was procedurally defaulted in the state courts—viz., counsel on
direct appeal did not raise the Confrontation Clause claim in his opening brief and
instead raised the claim for the first time in the reply brief. 3 Nonetheless, because
“[a] habeas petitioner may establish cause for his procedural default by showing
that he received ineffective assistance of counsel in violation of the Sixth
Amendment,” Banks v. Reynolds, 54 F.3d 1508, 1514 (10th Cir. 1995), and
because Mr. Barnes asserted in his third claim that his appellate counsel was
ineffective, the district court determined that Mr. Barnes may be able to
demonstrate cause for his procedural default of his first claim based on his
allegations in his third claim.
However, the district court concluded, consistent with the Colorado Court
of Appeals’s holding, that Mr. Barnes’s third claim failed on the merits—the
admission of the alleged hearsay statement did not raise Confrontation Clause
3
“In all cases in which a state prisoner has defaulted his federal claims
in state court pursuant to an independent and adequate state procedural rule,
federal habeas review of the claims is barred unless the prisoner can demonstrate
cause for the default and actual prejudice as a result of the alleged violation of
federal law, or demonstrate that failure to consider the claims will result in a
fundamental miscarriage of justice.” Coleman v. Thompson, 501 U.S. 722, 750
(1991).
-4-
concerns as it was non-testimonial, 4 and therefore, appellate counsel’s failure to
raise the issue on direct appeal did not result in constitutionally deficient
performance. Because Mr. Barnes’s ineffective assistance claim lacked merit, the
district court concluded that Mr. Barnes had failed to establish cause for the
procedural default of his Confrontation Clause claim.
The district court then proceeded to address the merits of Mr. Barnes’s
second claim, and concluded, as did the Colorado Court of Appeals, that trial
counsel was not constitutionally ineffective for failing to renew a motion for
mistrial after admission of the alleged hearsay statement—again, the statement
was non-testimonial, and Mr. Barnes’s girlfriend denied ever stating that she was
afraid of Mr. Barnes, making it unlikely that the statement caused prejudice to
Mr. Barnes. Accordingly, the district court dismissed Mr. Barnes’s case with
prejudice.
Mr. Barnes seeks to appeal from the district court’s denial of his § 2254
petition.
4
See generally Crawford v. Washington, 541 U.S. 36, 59 (2004)
(“Testimonial statements of witnesses absent from trial have been admitted only
where the declarant is unavailable, and only where the defendant has had a prior
opportunity to cross-examine.”); United States v. Smalls, 605 F.3d 765, 778 (10th
Cir. 2010) (analyzing Crawford and its progeny with respect to the meaning of
the term “testimonial”).
-5-
II
A COA is a jurisdictional prerequisite to our review of the merits of
a § 2254 appeal. See 28 U.S.C. § 2253(c)(1)(A); Clark v. Oklahoma, 468 F.3d
711, 713 (10th Cir. 2006); see also Gonzalez v. Thaler, 132 S. Ct. 641, 647–49
(2012) (discussing, inter alia, the “clear” jurisdictional language in § 2253(c)(1)).
We will issue a COA only if the applicant makes “a substantial showing of the
denial of a constitutional right.” Woodward v. Cline, 693 F.3d 1289, 1292 (10th
Cir. 2012) (quoting 28 U.S.C. § 2253(c)(2)) (internal quotation marks omitted);
accord Clark, 468 F.3d at 713. An applicant “satisfies this standard by
demonstrating that jurists of reason could disagree with the district court’s
resolution of his constitutional claims or that jurists could conclude that the issues
presented are adequate to deserve encouragement to proceed further.” Dulworth
v. Jones, 496 F.3d 1133, 1136–37 (10th Cir. 2007) (quoting Miller-El v. Cockrell,
537 U.S. 322, 327 (2003)) (internal quotation marks omitted).
When the district court denies relief “on procedural grounds, the applicant
faces a double hurdle. Not only must the applicant make a substantial showing of
the denial of a constitutional right, but he must also show ‘that jurists of reason
would find it debatable . . . whether the district court was correct in its procedural
ruling.’” Coppage v. McKune, 534 F.3d 1279, 1281 (10th Cir. 2008) (quoting
Slack v. McDaniel, 529 U.S. 473, 484 (2000)); see also Gonzalez, 132 S. Ct.
at 648.
-6-
III
Mr. Barnes seeks a COA from our court, alleging the following: (1) the
district court erred by dismissing his case with prejudice based on its conclusion
that his Confrontation Clause claim lacked merit; (2) the district court erred by
concluding that the Confrontation Clause claim was procedurally defaulted; and
(3) the district court misrepresented the facts of appellate counsel’s deficient
performance.
Pursuant to the analytic framework that the Supreme Court has established,
most notably in Miller-El and Slack, we have carefully reviewed Mr. Barnes’s
combined opening brief and application for COA as well as the record, including
the district court’s thorough order denying Mr. Barnes’s § 2254 petition. Based
upon this review, we conclude that Mr. Barnes is not entitled to a COA on any of
his claims because he has not made a substantial showing of the denial of a
constitutional right. For substantially the same reasons articulated by the district
court, reasonable jurists could not debate whether his § 2254 petition should have
been resolved in a different manner, and the issues that Mr. Barnes seeks to raise
on appeal are not adequate to deserve encouragement to proceed further.
Mr. Barnes also seeks to proceed in forma pauperis. However, he has not
demonstrated “the existence of a reasoned, nonfrivolous argument on the law and
facts in support of the issues raised on appeal.” Watkins v. Leyba, 543 F.3d 624,
627 (10th Cir. 2008) (quoting McIntosh v. U.S. Parole Comm’n, 115 F.3d 809,
-7-
812 (10th Cir. 1997)) (internal quotation marks omitted). Therefore, we decline
to grant this relief.
IV
For the foregoing reasons, we deny Mr. Barnes’s request for a COA, deny
his motion to proceed in forma pauperis, and dismiss this matter.
ENTERED FOR THE COURT
Jerome A. Holmes
Circuit Judge
-8-
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152 Conn. 513 (1965)
MARY ENGENGRO
v.
THE NEW HAVEN GAS COMPANY
Supreme Court of Connecticut.
Argued January 6, 1965.
Decided March 25, 1965.
KING, C. J., MURPHY, ALCORN, COMLEY and SHANNON, JS.
*514 John H. Peck, with whom was Joseph Pellegrino, for the appellant (plaintiff).
William R. Murphy, with whom was Kimberly B. Cheney, for the appellee (defendant).
SHANNON, J.
At the close of the plaintiff's case, the Court of Common Pleas directed that a verdict be returned for the defendant on all issues. The sole assignment of error attacks the denial of the plaintiff's motion to set aside the directed verdict.
The basic facts surrounding the plaintiff's claim are not in dispute. For several years prior to and on the date of the accident, plaintiff had been employed in the kitchen of Hamden High School. Each morning she had the duty of lighting the stoves and ovens, all of which were heated by gas supplied by the defendant. On the morning of March 24, 1961, the plaintiff was injured when the baker's oven exploded. Plaintiff testified that she could not remember whether she had turned on the gas *515 leading to the oven's pilot light when she went to ignite it. Although the gas company did not normally service "house pipes" leading from its meter to appliances, the company did service its own lines to the meter and had been servicing other gas appliances in the high school kitchen. On the day before the accident and also four days before the accident, gas company repairmen had been in the kitchen to service the dishwasher and the roasting oven immediately adjacent to the baker's oven. There was testimony that an odor of gas had been present in the kitchen for some time and that the company's repairmen had been so informed. This odor was particularly noticeable in the stove area. The situation was potentially dangerous, and the degree of care to be exercised had to be proportionate to the danger. Floyd v. Fruit Industries, Inc., 144 Conn. 659, 664, 136 A.2d 918; Knowles v. Crampton, 55 Conn. 336, 344, 11 A. 593. The defendant's repairmen, while on the premises to repair other appliances, were told that the odor of gas came from an unknown source. Although they serviced some of the appliances, they did not examine the baker's oven. Under the circumstances, the jury could find that a thorough examination should have been made of all appliances and that the failure to make one, if that was the case, could be found to be negligence. The gas company's service supervisor was called as a witness for the plaintiff and testified as to a series of tests which had been made on the morning of the explosion, including manual inspection, the "soap test" and a meter test. The results were negative for a leak in the baker's oven or any other appliance in the kitchen although a leak was discovered in the "house pipes" near the metal shop some distance from the kitchen.
*516 The two principal areas of evidential controversy center on plaintiff's actions prior to her attempt to light the pilot and the adequacy of the gas company's tests for leakage. The plaintiff claims that the accident was caused by a leak in or around the pilot or the oven burners. The defendant claims that the plaintiff hesitated or otherwise delayed in lighting the pilot on the morning of the accident, thus allowing an explosive concentration of gas to accumulate in the oven after she turned on the pilot light valve.
In reviewing the direction of a verdict for the defendant we examine the evidence in the light most favorable to the plaintiff. Santor v. Balnis, 151 Conn. 434, 435, 199 A.2d 2; Nuzzo v. Connecticut Steel Co., 147 Conn. 398, 400, 161 A.2d 791. We also consider the inferences which may reasonably be drawn from that evidence. Adams v. Mohican Hotel, 124 Conn. 400, 401, 200 A. 336. If there is evidence upon which the jury could have reasonably found liability in accordance with the allegations of the complaint, the court should not have directed the verdict. Bambus v. Bridgeport Gas Co., 148 Conn. 167, 168, 169 A.2d 265. Notice of an odor of gas was given to the defendant's employees upon two occasions shortly before the accident. There was testimony that this odor had been noticed for some time principally in the stove area and that the defendant's repairmen had been so informed. All appliances in the kitchen were turned off the night before. The pilot was found off after the explosion. There was no evidence that it had been touched after the explosion. The explosion resulted either from a leak or because the plaintiff delayed in lighting the pilot after turning it on. There was no evidence that the plaintiff was slow in lighting the match to *517 start the oven. In light of the obligation of servicing upon request which the defendant had assumed, the jury could find that the defendant was negligent in not discovering a leak. They could then properly find that such negligence was a proximate cause of the plaintiff's injuries and damages. The plaintiff had made out a prima facie case, which in the absence of a satisfactory explanation is sufficient to preclude the direction of a verdict for the defendant. Mott v. Hillman, 133 Conn. 552, 555, 52 A.2d 861; Peters v. Billick, 147 Conn. 699, 702, 166 A.2d 146.
Either there was a leak or the plaintiff was negligent in her procedure. We cannot say that the proof offered by the plaintiff is conclusive as to a leak having been present, but it is not necessary that only one theory be suggested by the evidence for it is the particular function of the jury to accept one theory and reject another. LeBlanc v. Grillo, 129 Conn. 378, 383, 28 A.2d 127. We do not require that the plaintiff's evidence exclude every other hypothesis but her own. Dickson v. Yale University, 141 Conn. 250, 253, 105 A.2d 463; LeBlanc v. Grillo, supra, 381; Bradbury v. South Norwalk, 80 Conn. 298, 301, 68 A. 321.
There is error, the judgment is set aside and a new trial is ordered.
In this opinion KING, C. J., ALCORN and COMLEY, Js., concurred.
MURPHY, J. (dissenting). Too much court time is wasted when we persist in reversing judges who have the good sense to direct verdicts in cases in which it would be necessary to set aside the verdict if the case was submitted to the jury. Bambus v. Bridgeport Gas Co., 148 Conn. 167, 171, 169 A.2d 265; *518 Lurier v. Danbury Bus Corporation, 144 Conn. 544, 547, 135 A.2d 597.
The majority opinion presupposes that there was a leak in the gas service in the baker's oven. But there was no evidence from which the jury could conclude that there was a leak in that piece of equipment. There was evidence that there had been an odor of gas in the kitchen but none in the vicinity of the baker's oven. The plaintiff testified that she did not know whether she had turned on the gas when she went to light the pilot. Yet, she stated that the pilot key was so tight that she could not turn it with her hands but had to use a pair of pliers to do so. The gas was turned off the night before, and it was off an hour after the explosion when the gas company's repairmen arrived. The pliers must have acted automatically. There were no leaks in the oven pipes when they were tested after the explosion. Certainly, if there had been a leak, the force of the explosion would have enlarged it. The trial judge was fully justified in directing the verdict.
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 02-4128
DENNIS THOMAS,
Defendant-Appellant.
Appeal from the United States District Court
for the Southern District of West Virginia, at Beckley.
Robert C. Chambers, District Judge.
(CR-01-26)
Submitted: February 20, 2003
Decided: February 28, 2003
Before LUTTIG, MOTZ, and GREGORY, Circuit Judges.
Affirmed by unpublished per curiam opinion.
COUNSEL
Edward M. Hall, LAW OFFICE OF EDWARD HALL, Morgantown,
West Virginia, for Appellant. Kasey Warner, United States Attorney,
John L. File, Assistant United States Attorney, Charleston, West Vir-
ginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
2 UNITED STATES v. THOMAS
OPINION
PER CURIAM:
Dennis Thomas was convicted by a jury of possession with intent
to distribute heroin, 21 U.S.C. § 841 (2000), and sentenced to forty-
one months imprisonment, followed by three years of supervised
release. Thomas’ attorney has filed a brief in accordance with Anders
v. California, 386 U.S. 738 (1967), addressing whether: (1) the dis-
trict court abused its discretion by forbidding Thomas from presenting
evidence of "good motive;" (2) the district court committed reversible
error when it refused to continue the trial in order to allow Thomas
to investigate further an entrapment defense; and (3) Thomas was
denied effective assistance of counsel. Counsel concedes, however,
that there are no meritorious issues for appeal. Although informed of
his right to file a supplemental pro se brief, Thomas has not done so.
In April 1998, an inmate at FCI-Beckley informed the FBI that
Thomas, then a chaplain at FCI-Beckley, had smuggled marijuana
and other items into the prison where Thomas had previously been
assigned. After an investigation, a controlled purchase was arranged
between Thomas and an undercover police officer. Thomas was
arrested after receiving a package of heroin and $6000 in cash, as
arranged during recorded telephone conversations.
Thomas first contends that the district court erred in excluding the
admission of any evidence that he had a "good motive" for his con-
duct; i.e., that he was acting on the belief that he was helping investi-
gate criminal activity in the prison. This court has explicitly rejected
any "good motive" defense to a violation of 21 U.S.C. § 841(a).
United States v. Fuller, 162 F.3d 256, 261 (4th Cir. 1998); see United
States v. Matthews, 209 F.3d 338 (4th Cir. 2000).
Thomas next contends that the district court erred in denying his
motion for a continuance to allow him to further investigate an
entrapment defense. In denying Thomas’ motion, the district court
found that Thomas had had ample time—more than eight months—to
investigate all possible defenses and that his attorney had already con-
sidered an entrapment defense and concluded that it was inapplicable.
Based on these findings, we cannot say that the district court abused
UNITED STATES v. THOMAS 3
its discretion in denying a continuance. United States v. Moore, 27
F.3d 969, 973 (4th Cir. 1994) (providing standard).
Finally, Thomas claims that he was denied effective assistance of
counsel. Claims of ineffective assistance are generally not cognizable
on direct appeal. See United States v. King, 119 F.3d 290, 295 (4th
Cir. 1997). Rather, such a claim is more properly addressed in a col-
lateral proceeding in which counsel has the opportunity to respond to
the allegations against him. United States v. DeFusco, 949 F.2d 114,
120-21 (4th Cir. 1991). An ineffective assistance of counsel claim
may be brought, however, when the record conclusively establishes
counsel’s representation was constitutionally ineffective. King, 119
F.3d at 295. We find that the record does not conclusively establish
that Thomas’ counsel rendered constitutionally ineffective assistance.
In accordance with the requirements of Anders, we have examined
the entire record in this case and find no meritorious issues for appeal.
Accordingly, we affirm Thomas’ sentence. This court requires that
counsel inform his client, in writing, of his right to petition the
Supreme Court of the United States for further review. If the client
requests that a petition be filed, but counsel believes that such a peti-
tion would be frivolous, then counsel may move in this court for leave
to withdraw from representation. Counsel’s motion must state that a
copy thereof was served on the client. We dispense with oral argu-
ment because the facts and legal contentions are adequately presented
in the materials before the court and argument would not aid the deci-
sional process.
AFFIRMED
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919 F.2d 1
Juan Abel GONZALEZ, Petitioner-Appellant,v.W.A. PERRILL, Warden, Respondent-Appellee.
No. 353, Docket 90-2218.
United States Court of Appeals,Second Circuit.
Submitted Oct. 17, 1990.Decided Nov. 8, 1990.
Juan Abel Gonzalez, pro se.
Frederick J. Scullin, U.S. Atty. for N.D.N.Y., William C. Pericak, David R. Homer, Asst. U.S. Attys., Patricia H. Jordan, Paralegal Specialist, Albany, N.Y., for Appellee.
Before OAKES, Chief Judge, LUMBARD and WINTER, Circuit Judges.
PER CURIAM:
1
Juan Abel Gonzalez, pro se, appeals from a judgment of the United States District Court for the Northern District of New York, Neal P. McCurn, Chief Judge, dismissing Gonzalez's petition for a writ of habeas corpus under 28 U.S.C. Sec. 2241. For the reasons set forth below, we affirm.
2
After his arrest in New York on federal narcotics charges, Gonzalez was released on bail on December 14, 1984. While on bail, he was arrested in Florida on an unrelated state narcotics charge on July 14, 1985. Thereafter, pursuant to a writ of habeas corpus ad prosequendum, he was transferred to New York, where he was tried, convicted and sentenced on the federal charges to four years' imprisonment. However, before the commencement of that sentence, Gonzalez was transferred back to Florida to stand trial on the pending state charge. In Florida, appellant was convicted and sentenced to a five-year prison term, to be served concurrently with the federal sentence. After serving his Florida sentence, he was released on February 1, 1988. Thereafter, he was re-arrested by federal authorities on March 9, 1989, on the ground that he was a fugitive from his four-year federal sentence. Gonzalez is currently serving that sentence in the Federal Correctional Institution in Ray Brook, New York.
3
Instead of seeking administrative review of his incarceration, Gonzalez commenced the present habeas corpus action in the Northern District of New York. The substance of his complaint is that he was improperly denied credit towards his federal sentence for the time served in Florida and for the time between his release in Florida and his federal arrest on March 9, 1989. Because we find that appellant has failed to exhaust his administrative remedies, we do not reach the merits of this claim.
4
It is well-settled that an appellant must exhaust his administrative remedies before seeking habeas corpus relief in the federal courts. See United States v. Lara, 905 F.2d 599, 605 (2d Cir.1990); Guida v. Nelson, 603 F.2d 261, 262 (2d Cir.1979) (per curiam). Gonzalez, however, claims that the exhaustion requirement is excused when a petitioner is entitled to immediate release from confinement. See Roche v. Sizer, 516 F.Supp. 961, 963 (D.Conn.1981), rev'd on other grounds, 675 F.2d 507 (2d Cir.1982); Downes v. Norton, 360 F.Supp. 1151, 1152 n. 1 (D.Conn.1973). This issue has yet to be resolved by this court. See Timpani v. Sizer, 732 F.2d 1043, 1047 n. 7 (2d Cir.1984).
5
The controlling standard is unambiguous: an appellant must exhaust his administrative remedies before seeking federal review of his conviction unless administrative procedures are unavailable or are incompetent to provide adequate redress. See Johnpoll v. Thornburgh, 898 F.2d 849, 851 (2d Cir.), cert. denied, --- U.S. ----, 111 S.Ct. 63, 112 L.Ed.2d 38 (1990); J.G. v. Board of Educ., 830 F.2d 444, 447 (2d Cir.1987). Neither basis has been demonstrated in the present case. Initially, we note that an elaborate administrative procedure exists that provides Gonzalez with ample opportunity to challenge his imprisonment. By statute, an incarcerated person has a right to seek review of his sentence by the Attorney General, "who shall give any such person credit toward service of his sentence for any days spent in custody in connection with the offense or acts for which sentence is imposed." 18 U.S.C. Sec. 3568 (1982).1 In addition, appellant may seek review of any aspect of his imprisonment by the Bureau of Prisons. See 28 C.F.R. Sec. 542.10 (1989). Under this procedure, appellant may seek formal review of his complaint by the warden of his incarcerating institution, and, if dissatisfied with the result, may appeal that decision to the Regional Director of the Bureau of Prisons, and ultimately to the Office of General Counsel. See 28 C.F.R. Secs. 542.13(b), 542.15 (1989).
6
There is no reason to believe that these administrative remedies are inadequate to provide the redress that appellant seeks. To support his petition for a writ of habeas corpus, Gonzalez stresses that he is entitled to be immediately released from prison. This urgency, however, does not vitiate the requirement that he exhaust his administrative remedies. He provides no reason, nor can we discern any, to believe that the administrative procedures in place cannot expediently resolve a claim for credit for time served. See Willis v. Ciccone, 506 F.2d 1011, 1015 (8th Cir.1974) ("Administrative procedures can, when available, provide an adequate and often the most expeditious review of prisoner grievances.") (emphasis in original). As a result, we decline to depart from the traditional rule that "the granting of credit for time served is in the first instance an administrative, not a judicial, function." United States v. Flanagan, 868 F.2d 1544, 1546 (11th Cir.1989); see also United States ex rel. Sanders v. Arnold, 535 F.2d 848, 851 (3d Cir.1976); United States v. Morgan, 425 F.2d 1388, 1389-90 (5th Cir.1970).
7
In so holding, we disagree with the conclusion in Roche that "[b]ecause petitioner would be 'out now' if he prevails on the merits of his claim, available administrative remedies are inadequate." 516 F.Supp. at 963 (quoting Downes, 360 F.Supp. at 1152 n. 1). Roche misstates the proper inquiry. In determining whether exhaustion is necessary, we cannot assume that appellant's claim is meritorious. Rather, the critical inquiry is whether the validity of the claim should initially be resolved by an administrative or judicial body. It may well be that petitioner deserves immediate release from incarceration. That determination, however, must first be made at the administrative level.
8
Accordingly, the judgment of the district court is affirmed.
1
18 U.S.C. Sec. 3568 was repealed by the Sentencing Reform Act, Pub.L. 98-473, Title II Sec. 212(a)(2), 98 Stat.1987 (1984). However, because the repeal applies only to offenses committed after November 1, 1987, appellant's rights are unaffected
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946 F.Supp. 485 (1996)
Billy Eugene McKEE, Plaintiff,
v.
AMERICAN TRANSFER AND STORAGE and AAA American Moving & Storage Co., Defendants.
Civil Action No. 1:96-CV-131-C.
United States District Court, N.D. Texas, Abilene Division.
December 2, 1996.
*486 Linda Sue Purcell, Law Office of Linda Purcell, Abilene, TX, for plaintiff.
Steven C. Malin, Law Office of Steven C. Malin, McKinney, TX, for defendants.
ORDER
CUMMINGS, District Judge.
On this day the Court considered Defendant AAA American Moving & Storage Co.'s (AAA) Motion to Dismiss Plaintiff's Original Complaint, and Brief in Support Thereof filed July 5, 1996. No response was filed. After considering all relevant arguments and evidence of counsel, the Court is of the opinion that AAA's Motion should be GRANTED IN PART and DENIED IN PART. The Court GRANTS AAA's Motion as it relates to Plaintiff's state claim WITH LEAVE TO AMEND the defect described below, but DENIES its Motion as it relates to Plaintiff's federal claim.
AAA brings this Motion pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. Therefore, this Court must accept all facts alleged by Plaintiff as true and view them in the light most favorable to Plaintiff. Baker v. Putnal, 75 F.3d 190, 196 (5th Cir. 1996).
Alleged Facts
American Transfer and Storage (American Transfer) employed Plaintiff Billy McKee as a furniture loader. During the course and scope of his employment, Plaintiff injured his back and subsequently sought medical attention. Because of his injury, Plaintiff filed a Worker's Compensation claim. After Plaintiff returned to work, American Transfer failed to make reasonable accommodations in the workplace which would eliminate the need for Plaintiff to lift heavy objects. Plaintiff alleges this violated the Americans with Disabilities Act of 1990 (ADA), 42 U.S.C. § 12101 et seq. Plaintiff also brings a state claim for wrongful termination. Plaintiff alleges that because he filed a Worker's Compensation claim, American Transfer terminated his employment. Plaintiff seeks to hold AAA liable because it is the successor to American Transfer.
Plaintiff sued AAA because it acquired the right, title and interest of American Transfer. As a result of this acquisition, Plaintiff asserts that AAA is derivatively liable for American Transfer's actions.
Defendant attacks Plaintiff's Complaint arguing that because Texas does not generally recognize successor liability[1] for subsequent *487 purchases of corporate assets, Plaintiff's Complaint fails to state a claim upon which relief can be granted. Although Defendant's Motion fails to differentiate the state claim from the federal claim, this distinction is important to the resolution of this motion. The issue of ADA successor liability is res nova in this Circuit.
12(b)(6) State Claim
Texas law does not generally recognize successor liability for subsequent purchases of corporate assets. See Mudgett v. Paxson Machine Co., 709 S.W.2d 755, 756-59 (Tex.App. Corpus Christi 1986, writ ref'd n.r.e.). The Texas Business & Corporations Act eliminates the doctrine of implied successor liability.[2] However, when the successor corporation expressly assumes the liability of the predecessor corporation, the successor corporation will be liable for the predecessor corporation's liabilities. Tex.Bus.Corp. Act Ann. art. 5.10B(1) and (2) (Vernon 1996); Glasscock v. Armstrong Cork Co., 946 F.2d 1085, 1094-95 (5th Cir.1991). There is no allegation in Plaintiff's complaint that Defendant expressly assumed any liabilities of American Transfer. Plaintiff's complaint fails to state a claim upon which relief can be granted.
12(b)(6) Federal Claim
Plaintiff asserts that American Transfer violated the ADA and, therefore, sued AAA under a successor liability theory.
This Court has been unable to find any cases that have addressed whether a successor corporation may be liable for its predecessor corporation's violations of the ADA.[3] Several courts, however, have addressed Title VII successor liability. See Rojas v. TK Communications, Inc., 87 F.3d 745 (5th Cir. 1996); EEOC v. MacMillan Bloedel Containers, Inc., 503 F.2d 1086, 1094 (6th Cir.1974); Wheeler v. Snyder Buick, Inc., 794 F.2d 1228 (7th Cir.1986); Long v. AT & T Information Systems, Inc., 733 F.Supp. 188 (S.D.N.Y. 1990).
The administrative procedures and the remedies under Title VII are the same as those available under the ADA. 42 U.S.C. § 12117; Buchanan v. City of San Antonio, 85 F.3d 196, 200 (5th Cir.1996) ("The remedies provided under the ADA are the same as those provided by Title VII, 42 U.S.C. §§ 2000e-4 to 2000e-6, 2000e-8, 2000e-9.") (footnote omitted). 42 U.S.C. § 2000e; Dao v. Auchan Hypermarket, 96 F.3d 787, 789 (5th Cir.1996) ("[T]he ADA incorporates by reference the procedures applicable under Title VII."). Consequently, this Court looks to those courts which have interpreted Title VII, 42 U.S.C. 2000e et seq. successor liability as guidance for successor liability of ADA claims.
In Rojas, the Fifth Circuit followed the Sixth and Seventh Circuits by holding that successor liability is available under Title VII. Rojas, 87 F.3d at 750. The court identified nine factors to be considered in determining whether successor liability should be imposed.[4] Of the nine factors, two are critical: (1) whether the successor company had notice of the charge or pending lawsuit prior to acquiring the business or *488 assets of the predecessor; and (2) the ability of the predecessor to provide relief. Id.
The policy behind the successor liability doctrine is to protect the employee when the ownership of the employer suddenly changes. Id. Because Defendant made this Motion before the Fifth Circuit decided Rojas, these factors were not addressed by Defendant. For the purposes of this motion, this Court must assume that those factors weigh in Plaintiff's favor.
For the reasons stated above, this Court GRANTS Defendant's Motion to Dismiss as it relates to Plaintiff's state law claim, WITH LEAVE TO AMEND the defect described above. Therefore, Plaintiff shall file his amended complaint to state a wrongful termination claim by December 16, 1996; otherwise Plaintiff's wrongful termination claim will be dismissed with prejudice. The Court DENIES Defendant's Motion to Dismiss as it relates to Plaintiff's federal claim.
SO ORDERED.
NOTES
[1] Defendant's 12(b)(6) motion uses successor and derivative liability interchangeably. This Court sees no difference in the words; however, because the Fifth Circuit has elected to use the phrase successor liability, we will do so as well. See Rojas v. TK Communications, Inc., 87 F.3d 745 (5th Cir.1996).
[2] Article 5.10B states:
A disposition of any, all, or substantially all, of the property and assets of a corporation, whether or not it requires the special authorization of the shareholders of the corporation, effected under Section A of this article or under Article 5.09 of this Act or otherwise:
(1) is not considered to be a merger pursuant to this Act or otherwise; and
(2) except as otherwise expressly provided by another statute, does not make the acquiring corporation ... responsible or liable for any liability or obligation of the selling corporation that the acquiring corporation ... did not expressly assume.
Tex.Bus.Corp. Act Ann. art. 5.10B (Vernon 1996).
[3] The Eleventh Circuit was presented with facts similar to ours in Gonzales v. Garner Food Services, Inc., 89 F.3d 1523 (11th Cir.1996). However, because the plaintiff was not a "qualified individual with a disability" pursuant to 42 U.S.C. § 12111(8), the district court granted the defendant's 12(b)(6) motion. Gonzales v. Garner Food Services, Inc., 855 F.Supp. 371 (N.D.Ga. 1994). Consequently, the Eleventh Circuit Court of Appeals was concerned with whether the plaintiff was a qualified individual, not with whether there was successor liability.
[4] The nine factors are:
"(1) whether the successor company had notice of the charge or pending lawsuit prior to acquiring the business or assets of the predecessor; (2) the ability of the predecessor to provide relief; (3) whether there has been a substantial continuity of business operations; (4) whether the new employer uses the same plant; (5) whether he uses the same or substantially the same work force; (6) whether he uses the same or substantially the same personnel; (7) whether the same jobs exist under substantially the same working conditions; (8) whether he uses the same machinery, equipment, and methods of production; and (9) whether he produces the same product." Rojas, 87 F.3d at 750 (citations omitted).
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654 So.2d 944 (1995)
STATE FARM FIRE & CASUALTY CO., a foreign insurer, Appellant,
v.
COMPUPAY, INC., a Florida corporation, Appellee.
No. 93-2009.
District Court of Appeal of Florida, Third District.
March 15, 1995.
Rehearing Denied June 7, 1995.
*945 Russo & Talisman and Elizabeth Russo, Coconut Grove, for appellant.
Brenton N. VerPloeg, Gallwey, Gillman, Curtis, Vento & Horn, and Karen H. Curtis, Miami, for appellee.
Before HUBBART, BASKIN and LEVY, JJ.
BASKIN, Judge.
State Farm Fire & Casualty Company [State Farm] appeals a final summary judgment finding that it had a duty to defend its insured, Compupay, Inc. [Compupay], a defendant in an employee's sexual harassment and sexual discrimination suit. We reverse.
Taymy Ode, a former Compupay employee, sued Compupay, and Larry Wank, Compupay's officer and Tampa branch manager, for damages stemming from Wank's sexual harassment and sexual discrimination of Ode, from Compupay's failure to investigate Ode's allegations against Wank and to take corrective action, and from Compupay's negligent retention of Wank. State Farm denied coverage and did not provide Compupay with a defense. Compupay settled the lawsuit with Ode.[1]
Thereafter, Compupay sued State Farm, its business liability insurance carrier, alleging that State Farm breached its duty to defend Compupay. Compupay asserted that State Farm's policy provided coverage for the loss under the personal injury provisions and under the bodily injury provisions. Both parties filed motions for summary judgment. The trial court granted final summary judgment in Compupay's favor.
The issues in this case are: 1) Whether the business liability policy provides coverage to Compupay for damages under the bodily injury or personal injury provisions; and 2) Whether public policy bars Compupay from recovering insurance proceeds to compensate it for losses incurred in an employee's sexual harassment/sexual discrimination claim. Our disposition of the case makes it unnecessary to reach State Farm's public policy argument.
I. Duty To Defend
Whether State Farm had a duty to defend Compupay is resolved by examining the "allegations of the complaint against the insured, not by the actual facts, nor the insured's version of the facts or the insured's defenses. There is no obligation on an insurer to defend an action against its insured when the pleading in question shows the applicability of a policy exclusion." Reliance Ins. Co. v. Royal Motorcar, 534 So.2d 922, 923 (Fla. 4th DCA 1988) (citations omitted), review denied, 544 So.2d 200 (Fla. 1989). If the facts alleged show any basis for liability *946 falling within policy coverage, the insurer must defend the suit. Baron Oil Co. v. Nationwide Mut. Fire Ins. Co., 470 So.2d 810 (Fla. 1st DCA 1985). However,
[a] liability insurance company has no duty to defend a suit where the complaint upon its face alleges a state of facts which fails to bring the case within the coverage of the policy. Consequently, the company is not required to defend if it would not be bound to indemnify the insured even though the plaintiff should prevail in his action.
National Union Fire Ins. Co. v. Lenox Liquors, Inc., 358 So.2d 533, 535 (Fla. 1977). Ode's complaint, in pertinent part, is appended to this opinion. In light of the factual allegations therein, we must determine whether there is any possibility that State Farm's policy covers Compupay for the losses it suffered in the sexual harassment and sexual discrimination action.
II. Availability of Coverage
A. Bodily Injury Coverage.
Compupay argues that Ode's factual allegations place the case within the policy's bodily injury coverage. State Farm maintains that the exclusion from coverage of on-the-job injuries applies in this case; and, that the acts of sexual harassment were intentional, not accidental. Because the acts were not "occurrences," the policy does not afford coverage. Here, the business liability policy[2] provides coverage for damages incurred as a result of "bodily injury, ... caused by an occurrence to which this policy applies." The policy defines "occurrence" as "an accident ... neither expected nor intended from the standpoint of the insured" and excludes coverage for "bodily injury to any employee of the insured arising out of and in the course of their employment... ." In analyzing the policy provisions, we give the terms of the contract their everyday meaning and read them in light of the skill and experience of an ordinary person. Lindheimer v. St. Paul Fire & Marine Ins. Co., 643 So.2d 636 (Fla. 3d DCA 1994) (on rehearing en banc). If the terms are clear and unambiguous, we need not resort to rules of construction to interpret the policy provisions. Old Dominion Ins. Co. v. Elysee, Inc., 601 So.2d 1243, 1245 (Fla. 1st DCA 1992).
The acts alleged in Ode's complaint do not fall within the policy's definition of an occurrence. Ode's complaint alleges that Wank's acts were specifically and intentionally directed towards her person. This court, upon interpreting an insurance policy defining "occurrence" as an accident, and excluding coverage for injury "expected or intended from the standpoint of the insured," has held that "the law is well-settled that there can be no coverage under an insurance policy which insures against an `accident' where `the [insured's] [sic] wrongful act complained of is *947 intentionally directed specifically toward the person injured by such act... .'" Hartford Fire Ins. Co. v. Spreen, 343 So.2d 649, 651 (Fla. 3d DCA 1977). Under this interpretation, acts of sexual harassment and discrimination, which are directed towards the injured person, are intentional acts. As such, Wank's acts fall outside of the definition of "occurrence" and no insurance coverage lies.
Compupay disingenuously argues that Ode's allegations constitute an accident because Compupay was not expecting them to occur. Ode's complaint alleges that Compupay was aware of Wank's past sexual discrimination and harassment practices, and asserts that Compupay ignored Ode's protests and complaints about Wank's behavior. Consequently, Wank's continuing pattern of sexual harassment and discrimination of employee Ode were predictable and should have been within Compupay's expectation. In determining the duty to defend, we may not consider the insured's view of the events, or its defenses. Reliance Ins. Co. Based on Ode's allegations, the events were not an accident, and not an "occurrence." No insurance coverage lies.
State Farm also argues that Wank's harassment and discrimination acts were not accidental because in sexual harassment cases, as in sexual abuse cases, the intent to harm the victim can be inferred. Landis v. Allstate Ins. Co., 516 So.2d 305 (Fla. 3d DCA 1987) (acts of child molestation clearly intentional and deliberate), aff'd 546 So.2d 1051, 1053 (Fla. 1989) ("To state that a child molester intends anything but harm and long-term emotional anguish to the child defies logic."). It can be reasoned that an act of discrimination or harassment, like an act of sexual abuse, has but one end: to harm the victim. Indeed several courts have concluded that sexual harassment is deemed an intentional act as a matter of law. Commercial Union Ins., Co. v. Sky, Inc., 810 F. Supp. 249, 253 (W.D.Ark. 1992) ("it strains the imagination to speculate how a pattern of sexual overtures and touching can be `accidental.'"), and cases cited therein; Sena v. Travelers Ins. Co., 801 F. Supp. 471 (D.N.M. 1992); Old Republic Ins. Co. v. Comprehensive Health Care Assoc., Inc., 786 F. Supp. 629 (N.D.Tex. 1992). Harassment and discrimination are neither negligent nor accidental; the perpetrator focuses on a chosen victim for the express purpose of carrying out the acts of harassment and discrimination. Thus, because we find that Wank's acts were intentional, and because Compupay was aware of Wank's history of sexual harassment activities, the definition of occurrence is not met and there can be no coverage under the bodily injury policy provisions.
In addition, Ode's factual allegations place the incidents squarely within the policy's "cross-employee" exclusion, which excludes from coverage "bodily injury to any employee of the insured arising out of and in the course of their employment by the insured... ." Florida courts have consistently given effect to unambiguous "cross-employee" policy exclusion clauses, such as the one in this case, and have barred recovery for injuries inflicted by a fellow employee. Liberty Mut. Ins. Co. v. Jones, 427 So.2d 1117 (Fla. 3d DCA 1983); McRae v. Snelling, 303 So.2d 670 (Fla. 4th DCA 1974); General Ins. Co. of America v. Reid, 216 So.2d 41 (Fla. 4th DCA 1968), cert. denied, 222 So.2d 752 (Fla. 1969).
The facts in Ode's complaint arose out of the course and scope of her employment. Ode's complaint states that Wank committed the acts "within the scope of his employment while Defendant Wank was on duty and during working hours in the service of Defendant Compupay." The policy language clearly and unambiguously excludes from insurance coverage an injury to an employee caused by another employee in the course of employment.[3]Reid.
Because the allegations in the complaint demonstrate that the cross-employee exclusion *948 bars coverage in this case, State Farm had no duty to defend Compupay.
B. Personal Injury Coverage.
Compupay also urges that coverage lies under the policy's personal injury clause. Personal injuries arising out of certain enumerated offenses are covered by the policy. The clause allows coverage for "the publication or utterance of a libel or slander or of other defamatory or disparaging material, or a publication or utterance in violation of an individual's right of privacy... ." Compupay contends that coverage is available because the harassing and discriminatory remarks disparaged Ode or, alternatively, that Ode's allegations amount to an action for invasion of privacy. State Farm denies that coverage is available because the acts alleged do not state claims falling within the enumerated offenses: Ode's factual allegations do not state a libel, slander or disparagement claim, and do not allege publication or utterance in violation of the right to privacy. We address each argument in turn.
1. Disparaging Remarks
The policy covers, as a personal injury, claims arising from "the publication or utterance of a libel or slander or of other defamatory or disparaging material... ." Compupay does not assert that Ode made any claim for defamation. Compupay focuses on the word disparaging, and asserts that because sexual harassment disparages its victim, coverage exists under the policy. This argument fails because Ode has not alleged the publication or utterance of disparaging material.
There is a group of torts recognized under the collective title of injurious falsehoods which are interchangeably called slander of title, disparagement of goods, or trade libel. Collier County Pub. Co. v. Chapman, 318 So.2d 492 (Fla. 2d DCA 1975), cert. denied, 333 So.2d 462 (Fla. 1976); see Residential Communities of America v. Escondido Community Assn., 645 So.2d 149, 150 (Fla. 5th DCA 1994) (Griffin, J., dissenting). "Generally, the publication of any false and malicious statement which tends to disparage the quality, condition, or value of the property of another, and which causes him special injury or damage, is actionable." 50 Am.Jur.2d Libel & Slander § 542 (1970). "[I]t is essential to a cause of action that the alleged slanderous or disparaging statement be made or published to some third person." 50 Am.Jur.2d Libel & Slander § 545 (1970). The factual allegations in Ode's complaint do not assert any damage to property and make it clear that these causes of action do not apply to this case.
Even if we were to adopt Compupay's assertion that sexual harassment disparages its victims, Ode's allegations would not fall within the scope of policy coverage. Ode did not allege publication of the harassing or discriminatory remarks. A plain reading of the policy provision unambiguously demonstrates that being disparaged, without more, is insufficient to invoke coverage. The clause requires "the publication or utterance of... defamatory or disparaging material... ." (Emphasis added). The factual allegations in Ode's complaint do not invoke this clause. We decline to hold that the policy covers a situation when one is addressed in a manner that makes one feel disparaged. The clause's language is plain and clear.
2. Invasion of Privacy
"[T]he right of privacy was inherent in the common law and had been protected ... under the guise of property rights... ." Cason v. Baskin, 155 Fla. 198, 20 So.2d 243, 248 (1944). Florida recognizes a cause of action for invasion of privacy. Stoddard v. Wohlfahrt, 573 So.2d 1060 (Fla. 5th DCA 1991). "The right of privacy is defined as the right of an individual to be let alone and to live a life free from unwarranted publicity[,]" Harms v. Miami Daily News, Inc., 127 So.2d 715, 717 (Fla. 3d DCA 1961); it is "the right to be let alone, the right to live in a community without being held up to public gaze if you don't want to be held up to public gaze." Cason, 20 So.2d at 248. In recognizing the tort, the Cason court defined an actionable invasion of the right of privacy as: "The unwarranted appropriation or exploitation of one's personality, the publicizing of one's private affairs with which the public has no legitimate concern, or the wrongful *949 intrusion into one's private activities, in such manner as to outrage or cause mental suffering, shame, or humiliation to a person of ordinary sensibilities." Cason, 20 So.2d at 249 (Fla. 1944). Claims based on this tort require the allegation and proof of publication to a third person of personal matter. Cason; Stoddard.
Recently, an exception has been created in cases where the plaintiff's person has been touched in an undesired or offensive manner. Stoddard; Stockett v. Tolin, 791 F. Supp. 1536 (S.D.Fla. 1992) (employee prevails on invasion of privacy claim against employer who groped and fondled her). Compare Ponton v. Scarfone, 468 So.2d 1009 (Fla. 2d DCA) (employer's utterances designed to induce employee into sexual liaison are insufficient to come within zone of conduct constituting unlawful invasion of employees right of privacy), review denied, 478 So.2d 54 (Fla. 1985); Steele v. Offshore Shipbuilding, Inc., 867 F.2d 1311 (11th Cir.1989) (employee's invasion of privacy action against employer fails because employee did not prove publication of suggestive comments, no physical invasion of employee was alleged). Compupay relies on this line of cases to urge that Ode's allegations of offensive and undesired touching state a cause of action for invasion of privacy, bringing the claim within coverage under the personal injury clause. The argument fails because it ignores the clear and unambiguous language in the personal injury clause.
The clause clearly states that coverage is available for "a publication or utterance in violation of an individual's right to privacy... ." (Emphasis added). The clause does not cover causes of action under the broader umbrella of invasion of privacy torts. Thus, the policy covers actions within the traditional invasion of privacy tort: a publication of personal matter. It does not include coverage for a physical invasion of the complainant's person unaccompanied by the other elements of the cause of action. Moreover, such a holding is inconsistent with a plain reading of the remainder of the clause which provides coverage for libelous and slanderous publications. Once again, in determining the issue of coverage, we note that we may consider only the facts alleged in the complaint as viewed against the policy provisions. We may not ratify the insured's version of the facts, or the theory of plaintiff's case. Ode's complaint lacks any factual allegations of publication which would bring the claim within this provision.
Based on the foregoing reasoning, we hold that State Farm had no duty to defend Compupay, as Ode's complaint contained no facts bringing the case within the purview of policy coverage, and, in fact, brought it within a policy exclusion. Accordingly, State Farm had no duty to defend. The summary judgment in Compupay's favor cannot stand. We reverse the summary judgment and remand for entry of summary judgment in State Farm's favor.
Reversed and remanded.
APPENDIX
Ode v. Wank, No. 91-286-CIV-T-98A (M.D.Fla. 1991).
... .
COUNT I
... .
12. This is an action for discrimination because of sex (female), based upon Defendant Wank's unlawful conditioning of the terms and conditions of Plaintiff's employment upon her sex.
13. Subsequent to Plaintiff's employment ... Plaintiff was subjected to unwelcome sexual harassment in the form of sexual advances and requests for sexual favors.
... .
15. Defendant Compupay was aware of Defendant Wank's propensity toward discrimination because of sex and had actual knowledge of his discrimination against Plaintiff... .
... .
COUNT II
... .
18... . Plaintiff was subjected to unwelcome sexual harassment because of her sex by Defendant Wank.
... .
*950 20. Defendant Compupay had both actual and constructive notice of Defendant Wank's discriminatory conduct towards Plaintiff during her employment... . Defendant Compupay took no corrective action to address and remedy the complained of sexual discrimination and harassment.
... .
COUNT III
... .
23. Defendant Wank subjected Plaintiff to unsolicited and offensive physical contact. This offensive conduct consisted of unsolicited and offensive touching and kissing.
24. The acts committed by Defendant Wank as described herein were committed within the scope of his employment while Defendant Wank was on duty and during working hours in the service of Defendant Compupay.
25. The unsolicited physical contact was of a sexual impulse and nature and was designed to intimidate and invaded the physical privacy of Plaintiff's body.
... .
COUNT IV
... .
28. Defendant Compupay was aware, prior to the employment of Plaintiff, that Defendant Wank had discriminated against female employees because of sex.
29... . Defendant Compupay was aware of and had actual and constructive knowledge of Defendant Wank's sexual attraction to and obsession with Plaintiff.
30. Despite Defendant Compupay's actual and constructive notice of Defendant Wank's unfitness as an agent, especially a manager, Defendant Compupay failed to take remedial action.
31. Despite Defendant Compupay's knowledge of Defendant Wank's [behavior] ... Defendant Compupay ... took no action to remedy his discrimination against Plaintiff... .
32. Defendant Wank's actions against Plaintiff were willful and wanton sex-based discrimination and constituted foreseeable injury to Plaintiff which Defendant Compupay did not act to prevent... .
NOTES
[1] Compupay has paid Ode an agreed settlement. Ode is not a party to this appeal.
[2] The Business Liability policy provides, in pertinent part, as follows:
SECTION II COMPREHENSIVE BUSINESS LIABILITY __________ COVERAGE L BUSINESS LIABILITY
The Company will pay on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of bodily injury, property damage or personal injury caused by an occurrence to which this insurance applies.
... .
BUSINESS LIABILITY EXCLUSIONS
Under Coverage L, this policy does not apply:
... .
9. to bodily injury to any employee of the insured arising out of and in the course of their employment by the insured... .
... .
SECTION II
DEFINITIONS
... .
2. bodily injury means bodily injury, sickness or disease sustained by any person... .
... .
11. occurrence means an accident, ... which results in bodily injury or property damage neither expected nor intended from the standpoint of the insured and with respect to personal injury, the commission of an offense, or a series of similar or related offenses... .
... .
12. personal injury means injury which arises out of one or more of the following offenses committed in the conduct of the named insured's business:
... .
b. the publication or utterance of a libel or slander or of other defamatory or disparaging material, or a publication or utterance in violation of an individual's right of privacy... .
[3] In Byrd v. Richardson-Greenshields Securities, Inc., 552 So.2d 1099 (Fla. 1989), the Florida Supreme Court held that workers' compensation was not the sole remedy available to an employee who was a victim of sexual harassment. We can infer from this holding that because workers' compensation is an available remedy, the incident of harassment is deemed to arise out of the course and scope of employment. See § 440.09(1), Fla. Stat. (1993) (workers' compensation payable if injury arises out of and in the course of employment).
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968 N.E.2d 215 (2008)
383 Ill. App.3d 1138
360 Ill. Dec. 136
CORBO
v.
TOUCH OF HEALTH MANAGEMENT CORP.
No. 1-07-1886.
Appellate Court of Illinois, First District.
August 8, 2008.
Rem. with directions.
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510 U.S. 815
Bradleyv.Ohio.
No. 92-1834.
Supreme Court of United States.
October 4, 1993.
1
Appeal from the Ct. App. Ohio, Ross County.
2
Certiorari denied.
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IMPORTANT NOTICE
NOT TO BE PUBLISHE D OPINION
THIS OPINION IS DESIGNATED "NOT TO BE PUBLISHED ."
PURSUANT TO THE RULES OF CIVIL PROCEDURE
PROMULGATED BY THE SUPREME COURT, CR 76.28(4)(C),
THIS OPINION IS NOT TO BE PUBLISHED AND SHALL NOT BE
CITED OR USED AS BINDING PRECEDENT IN ANY OTHER
CASE IN ANY COURT OF THIS STATE; HOWEVER,
UNPUBLISHED KENTUCKY APPELLATE DECISIONS,
RENDERED AFTER JANUARY 1, 2003, MAY BE CITED FOR
CONSIDERATION BY THE COURT IF THERE IS NO PUBLISHED
OPINION THAT WOULD ADEQUATELY ADDRESS THE ISSUE
BEFORE THE COURT. OPINIONS CITED FOR CONSIDERATION
BY THE COURT SHALL BE SET OUT AS AN UNPUBLISHED
DECISION IN THE FILED DOCUMENT AND A COPY OF THE
ENTIRE DECISION SHALL BE TENDERED ALONG WITH THE
DOCUMENT TO THE COURT AND ALL PARTIES TO THE
ACTION.
RENDERED : AUGUST 21, 2008
NOT TO BE PUBLISHED
~ixyx~~ent~e C~oixxf ~af~~~~l
2007-SC-000214-MR
BLAKE HADDIX APPELLANT
ON APPEAL FROM BREATHITT CIRCUIT COURT
V. HONORABLE FRANK A. FLETCHER, JUDGE
NO . 03-CR-000139
COMMONWEALTH OF KENTUCKY APPELLEE
MEMORANDUM OPINION OF THE COURT
VACATING AND REMANDING
I. Introduction
A Breathitt County jury convicted Blake Haddix of murder' and of second-degree
assault . 2 In accordance with the jury's recommendation, Haddix was sentenced to
thirty-five (35) years for murder and five (5) years for second-degree assault, to be
served consecutively, for a total of forty (40) years in prison . Appealing to this Court as
a matter of right, Haddix argues the circuit court erred by: (1) failing to conduct a
hearing into the possible impropriety of two jurors; and (2) failing to consider evidence of
non-disclosure by a third juror. Finding the circuit court abused its discretion in failing to
hold a hearing, we vacate the judgment of the court and remand this matter for a
hearing to determine whether Haddix's allegations of juror misconduct are true and, if
so, whether a new trial is warranted.
Kentucky Revised Statute (KRS) 507 .020.
2 KRS 508 .020 .
3 Kentucky Constitution §110(2)(b) .
11 . Factual Background
On the evening of September 5, 2003, Estill Mullins and his father, Woodrow
Mullins, were sitting on Estill's front porch in Breathitt County . Appellant Haddix, who
had known Estill and Woodrow for some time, arrived on a four-wheeler to visit with
them . As they talked, the three men drank beer. After Woodrow came inside, Estill's
wife, Gladys, went to the door and called Estill inside. As Estill was closing the front
door behind him, he was struck by a bullet that came through the window of the front
door. Estill fell to the floor, bleeding from a wound to the head .
Having heard the shot, Gladys headed for the back door so that she could leave
and call the police. As the Mullins's home had no phone, Gladys intended to drive a
short distance to her sister's house. Gladys heard two more shots as she drove away.
As Gladys was leaving, Woodrow grabbed a .410 gauge shotgun and went
outside to confront Haddix . Haddix shot Woodrow twice, with one round traveling from
the chest to the neck and the other round entering the abdomen .
Officers arrived to find Woodrow lying dead on the front porch and Estill lying in
the hallway bleeding from a head wound . Officers also discovered Haddix lying in the
driveway. Haddix appeared to be very intoxicated and had one hand near the grip of a
revolver sticking out of a pocket. Haddix was taken into custody and a .32 caliber
revolver was recovered .
Officers also recovered the .410 gauge shotgun that was found lying near
Woodrow's body. The shotgun had one live round in the chamber . Testimony at the
preliminary hearing indicated no spent shotgun shells were recovered from the scene.
Further, while officers were unable to recover the round that struck Estill, they did
recover both of the rounds that struck Woodrow. Ballistics tests indicated both rounds
that struck Woodrow were fired from the .32 caliber revolver recovered from Haddix.
At trial, Haddix confirmed that he drove to the Mullins's residence on a four-
wheeler, and that the men sat outside drinking beer. However, Haddix claimed that the
men argued over a timber cutting contract . While Haddix denied shooting Estill, he
claimed he shot Woodrow in self defense. Haddix testified that Woodrow came out of
the house with the shotgun and fired it. As Woodrow was reloading, Haddix warned him
not to continue . When Woodrow aimed the shotgun at him, Haddix shot Woodrow.
Haddix's four day trial began on September 26, 2006. While thirteen (13) jurors
were initially seated, one juror was excused on the third day of trial when she advised
the court that she was an acquaintance of James Haddix, a relative of the defendant .
The remaining jurors returned a verdict convicting Haddix and recommending a prison
term of forty (40) years.
111 . Analysis
All claims of error by Haddix relate to juror misconduct . In particular, Haddix has
argued three jurors failed to disclose information during voir dire . In his first post-trial
motion for a new trial, Haddix rated concerns that one juror failed to disclose that he
was a convicted felon and a non-resident of Breathitt County, and that a second juror
failed to disclose that she or a family member had been the victim of a crime . In a
subsequent motion, Haddix alleged that a third juror failed to disclose her relationship to
the victim . Specifically, Haddix alleges the juror's sister was married to the first cousin
of the victim . Haddix contends he did not learn of the information until after trial and,
thus, was denied a fair trial .
Following the first motion, the circuit court agreed to consider the matter and
entered an order directing the Kentucky Bureau of Investigation (KBI) to investigate and
report its findings to the court within sixty (60) days. Apparently, no investigation took
place, nor was a report filed . Nearly three months later, the parties appeared before a
newly elected judge on Haddix's motion to be released on bond . The judge denied the
request for bond, as well as Haddix's pending motions for a new trial based on juror
misconduct, and set a date for final sentencing . Haddix contends this was error.
This Court has recognized that the right to an impartial adjudicator, be it judge or
jury, is basic to a fair trial . See Paenitz v . Commonwealth, 820 S.W.2d 480, 482 (Ky.
1991) . Further, we have long recognized that:
the right of challenge includes the incidental right that the information elicited
on the voir dire examination shall be true; the right to challenge implies its fair
exercise, and, if a party is misled by erroneous information, the right of rejection
is impaired[ .]
Johnson v. Commonwealth, 311 Ky. 182, 223 S.W .2d 741, 743 (1949). Underlying this
rationale is our conclusion that "the question is not whether an improperly established
tribunal acted fairly, but it is whether a proper tribunal was established[ .]" Id .
We agree the circuit court erred in failing to hold a hearing on the allegations
concerning the alleged misconduct of the three jurors. In Smith v. Commonwealth, this
Court recognized the trial court had the option to hold a post-trial hearing to determine
allegations of juror bias . 734 S.W.2d 437, 445 (Ky. 1987) (citation omitted) . In this
case, Haddix brought allegations of juror misconduct. If it is shown that,the first juror
was a convicted felon or a non-resident of Breathitt County at the time of trial in
September of 2006, Haddix would be entitled to a new trial . See Johnson, 223 S .W.2d
4
We do not address the legitimacy of the circuit court's order directing the KBI to investigate . As
we have found the original order to be interlocutory, the KBI issue becomes collateral and irrelevant to our
consideration . Since the first order was interlocutory, it was subject to reconsideration by the court.
Thus, we reject Haddix's claim that collateral estoppel applies to the circumstances present in this case.
4
at 743. In the case of the juror who may have failed to disclose that she or a family
member had been the victim of a crime, the court would have discretion, based on the
circumstances and the juror's knowledge at the time of the verdict, to determine if
Haddix is entitled to a new trial. Likewise, should the third juror be related to the victim
as alleged, the court would have the discretion to determine if Haddix has demonstrated
implied bias based on a relationship by consanguinity or affinity. Pennington v.
Commonwealth , 316 S.W.2d 221, 223 (Ky. 1958) . See also Kentucky Rule of Criminal
Procedure (RCr) 9.36. However, Haddix terminates the analysis without considering all
of the requirements.
In Gordon v. Commonwealth, this Court recognized that
In circumstances where no challenge is made to juror qualification prior to or
during trial and the challenge first occurs after rendition of a verdict, a party
seeking relief from the effect of the verdict bears a heavy burden . It is incumbent
upon such a party to allege facts, which if proven to be true, are sufficient to
undermine the integrity of the verdict.
916 S.W.2d 176, 179 (Ky. 1995) . Further, we recognized that "[w]hile we are prepared
to grant relief in a proper case, such will not be lightly undertaken and without a
substantial basis in fact." Id. (internal citation omitted) .
In making a motion for new trial based on juror misconduct, Haddix must show
that the juror was questioned concerning the matter; that the juror failed to disclose the
existence of the relationship; and that he was not aware of the juror's non-disclosure
until after the trial. See Shepherd v. Commonwealth , 269 Ky. 237, 106 S.W.2d 988,
990 (1937) (citation omitted) .
Assuming, without deciding, Haddix's allegations can be supported by evidence,
the burden then shifts to the Commonwealth to prove the juror's knowledge of the
relationship at the time of the verdict. See Pennington, 316 S.W.2d at 224 . See also
Horton v. Commonwealth, 240 S .W.2d 612, 613 (Ky. 1951) . Only after the
Commonwealth has an opportunity to respond can the trial court determine if a new trial
is warranted. In reaching this conclusion, we have recognized that "where the
relationship of a juror to a deceased is remote and unknown to the juror at the time the
verdict was rendered, it does not constitute a valid ground for reversal." Horton , 240
S .W.2d at 613 (citations omitted) .
Further, in the case of the juror with the alleged relationship to the victim, the
circuit court must consider whether the relationship alleged (the juror's sister was
married to a first cousin of the victim) exists and was known to the juror. The court must
then determine whether implied bias based on consanguinity or affinity has been
established . See Davis v. Commonwealth, 271 Ky. 180, 111 S .W.2d 640 (1937) (juror's
husband was the uncle of the husband to the mother of the deceased - found
relationship not sufficient) ; Cox v. Commonwealth, 255 Ky. 391, 74 S.W.2d 346 (1934)
(one juror was shown to have the following relationships : (1) the juror was the second
cousin to the wife of the brother of the deceased; and (2) the juror's wife's uncle married
the niece of the deceased - neither relationship was found to be sufficient) . Only if the
circuit court finds that each of the requirements of the analysis is satisfied is a new trial
warranted concerning the allegation that the third juror failed to disclose a relationship to
the victim .
In light of the fact that the court failed to hear evidence concerning Haddix's
allegations of juror misconduct, we reject the Commonwealth's argument that Haddix
failed to meet the heavy burden set out under Gordon , 916 S .W.2d at 179 . Until
evidence has been presented and ruled upon, it is premature to conclude Haddix
cannot meet the required burden .
IV. Conclusion
In light of Haddix's allegations concerning juror misconduct, we conclude the
circuit court abused its discretion by failing to hold a hearing to resolve the claims. For
this reason, we vacate the judgment of the Breathitt Circuit Court and remand this
matter for a hearing to determine whether Haddix's allegations of juror misconduct are
true and, if so, whether a new trial is warranted.
Minton, C.J .; Abramson, Cunningham, Noble, Schroder and Scoff, JJ ., concur .
Venters, J ., not sitting .
COUNSEL FOR APPELLANT :
Bruce William Francisky
Michael A. Stidharn
Stidharn & Francisky Law Office
500 Brown Street
P .O. Box 732
Jackson, KY 41339
COUNSEL FOR APPELLEE:
Jack Conway
Attorney General
David A. Smith
Assistant Attorney General
Office of Attorney General
Criminal Appellate Division
1024 Capital Center Drive
Frankfort, KY 40601-8204
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884 A.2d 770 (2005)
165 Md. App. 80
Fotis ZOGRAFOS, et al.
v.
MAYOR AND CITY COUNCIL OF BALTIMORE.
No. 1048, September Term, 2004.
Court of Special Appeals of Maryland.
October 7, 2005.
*774 Douglas N. Silber (Kelly Bollinger Burke, on the brief), Towson, for Appellants.
Andrew G. Bailey, Elva E. Tillman (Ralph S. Tyler, City Sol., on the brief), Baltimore, for Appellee.
Panel: DEBORAH S. EYLER, BARBERA and WILLIAM W. WENNER, (Retired, specially assigned), JJ.
BARBERA, Judge.
This appeal arises from the filing of a "quick-take" condemnation petition in the Circuit Court for Baltimore City by appellee, the Mayor and City Council of Baltimore (the "City"), pursuant to § 21-16 of the Code of Public Local Laws of Baltimore City ("CPLBC").[1] In the petition, the City condemned a portion of waterfront property located in the "Fells Point" section of Baltimore City, also known as Miller's Pier and Jackson's Wharf ("the Property"). The Property had been owned by appellants, Fotis Zografos, et al.[2]
The City paid into the registry of the court the sum of $260,000.00, representing the higher of two appraisals of fair market value the City had obtained. The case proceeded to trial. A jury found the fair market value of the Property to be $300,000.00, and returned an inquisition in that amount.
Appellants noted this timely appeal and present the following questions for our review, which we have reordered:
1. Whether the circuit court erred as a matter of law when it ignored the express language of Maryland Code (1974, 2003 Repl. Vol.), § 12-105(b) and (c) of the Real Property Article ("RP"), and refused to admit evidence of the State tax assessments issued December, 1987 (effective July 1, 1988), and January, 2003 (effective July 1, 2003), even though *775 each assessed value was substantially greater than the appraised value placed on the [P]roperty by the City.
2. Whether the circuit court erred as a matter of law when it admitted testimony of a City witness, and refused to strike the opinions of the City's two appraisers after each testified that the highest and best use of the [P]roperty was affected by the public project, thereby allowing the jury to consider evidence of value based upon the effect of the taking involved.
3. Whether the circuit court erred as a matter of law when it refused to instruct the jury that, in determining the highest and best use of the [P]roperty, and in settling upon the fair market value of that property, they were to assume that [] Ordinance [89-412] had not been enacted, and to ignore the associated restrictions precluding any development but a public park.
We conclude that the circuit court committed prejudicial error when it refused to permit appellants to introduce the 1988 tax assessment as evidence of a diminution in the value of the Property caused by the 1989 ordinance authorizing the taking of it. We therefore shall vacate the judgment on that basis and remand for a new trial. We shall address the remaining issues, as they may arise on retrial.
FACTS AND PROCEEDINGS
Appellants owned three waterfront parcels of property located at 910 South Bond Street, which together comprise the Property. The Property is approximately half an acre in size and is zoned M-3.[3]
On October 14, 1975, by Ordinance No. 999, the City approved an "Urban Renewal Plan" for Fells Point (the "Plan").[4] The Plan has been amended several times over the years. Of importance to this case, on November 17, 1989, the City approved Ordinance No. 412, amending the Plan by authorizing the City to acquire the Property in fee simple "by purchase or by condemnation, for urban renewal purposes. . . ." Ordinance 412 designated the Property "for public park use" only.
On November 21, 2002, thirteen years after Ordinance 412 was approved, the City instituted condemnation proceedings in the Circuit Court for Baltimore City pursuant to its quick-take authority. On that date, the City deposited into the registry of the court the sum of $260,000.00, representing the higher of two fair market value appraisals of the Property. Also on that date, the City petitioned for immediate possession and fee simple title of the Property. By order entered on November 27, 2002, the court granted the City's petition for possession of the property.
The City and appellants could not agree on the fair market value of the Property. Therefore, on June 9, 2004, the case came on for what would be a four-day jury trial to determine the fair market value of the Property.[5] After opening statements, the *776 jury visited and viewed the Property, which by that time the City had converted into a public park.
The City then began its case-in-chief. Kimberly Clark, the Baltimore Development Corporation's East Team Director for Economic Development, testified to the location of the Property and areas surrounding it. She also described some improvements that were made to the Property after the institution of condemnation proceedings.
C. Gordon Gilbert, Jr. testified as an expert in commercial real estate appraisals. He testified that he inspected the Property in May 2002 and saw that its southeastern edge looked as if it had been "unprotected by any coherent bulkhead" and that the water had eroded some of that edge. He testified that he compared the sales of eight properties similar to the Property to determine its fair market value. His June 12, 2002 appraisal report was received in evidence. Mr. Gilbert opined, consistently with his report, that the Property had a fair market value of $260,000.00 in 2002.
Mr. Gilbert agreed that the Property is situated in an area that is "one of the hottest locations in" Baltimore. He testified that, as of the date of taking, other properties around the Property were zoned for certain commercial uses and that there was "a very high probability of th[e] [P]roperty being rezoned to" such commercial uses.
During Mr. Gilbert's testimony, the parties stipulated that, as of the date of taking, November 21, 2002, the Property had "frontage" on South Bond Street.
After Mr. Gilbert's testimony was concluded, appellants moved to strike all of it. Appellants argued, inter alia, that Mr. Gilbert's appraisal should have ignored the public park project, as required by RP § 12-105. The court denied the motion.
Calvin Thomas also testified for the City as an expert commercial real estate appraiser. Mr. Thomas testified that he visited the Property, which he described as "unimproved" and "eroding away into the water." Mr. Thomas's January 2002 appraisal report was received into evidence. Mr. Thomas testified, consistently with his report, that the fair market value of the Property was zero. Mr. Thomas also testified that, when he conducted his appraisal report, he assumed that the Property was landlocked.
At the conclusion of Mr. Thomas's testimony, appellants moved to strike Mr. Thomas's opinion of the fair market value of the Property. Appellants argued that it should be stricken because, inter alia, it was not given to a reasonable degree of certainty; he improperly considered the public park project; and he assumed that the Property was landlocked. The court denied the motion.
Laurie Feinberg, an employee in the Baltimore City Department of Planning, testified that one of the goals of the Plan is to ensure public access to the waterfront. Ms. Feinberg testified that, under the Plan, as amended in 1989, the Property could not be used to develop condominiums. She explained that, before development of condominiums on the Property could begin, the City would have to pass an ordinance authorizing such development.
Ms. Feinberg also testified that the 900 block of South Bond Street was a "paper street." She explained that a "paper *777 street" "doesn't function as a street in that cars [do not drive on it,] but it's never been legally closed." She stated that, as far as she knew, the 900 block had "not been open to traffic." Ms. Feinberg testified that an approximately twelve-foot frontage on the 900 block of South Bond Street would not comply with fire department requirements that a right of way be at least twenty feet in width to allow for fire truck traffic. Nor would the frontage comply with City requirements that a road handling vehicular traffic be at least forty feet in width. Road improvements allowing for any vehicular traffic, according to Ms. Feinberg, would have to be borne by the property owner. Ms. Feinberg also testified that the Plan mandated a twenty-foot waterfront promenade, meaning that anything done with the Property would have to account for twenty feet of open space for a public promenade.
The court accepted Ms. Feinberg as an expert in municipal planning. She opined, to a reasonable degree of certainty, that road improvements needed to comply with access requirements in this case could cost between $800,000.00 and $2,000,000.00.
Ms. Clark was then recalled to testify on behalf of the City. Over appellants' objection, she testified that the City spent approximately $2,600,000.00 to build the public park on the Property. The court received in evidence a document prepared by the Department of Transportation reflecting that cost.
After Ms. Clark's testimony, the City rested its case, and appellants began their case.
Alfred W. Barry, III testified as an expert in land planning. Mr. Barry testified that he had been employed in the City's Planning Department from 1972 until 1995, the last eight years of which he served as Assistant Planning Director. Mr. Barry was familiar with the Plan and the Property. He testified that the highest and best use of the Property was to build up to eighteen townhouses and eighteen marina slips. He opined, to a reasonable degree of certainty as an expert land planner, that, "had the City not . . . designated th[e] [P]roperty to be acquired for a park, [] a development scheme for 18 houses . . . would have been rezoned by the City and approved by the City." He further opined that it would have taken about six to nine months for the City to approve such a development plan, and that a potential developer would think this amount of time reasonable.
Terry Duncan testified as an expert real estate appraiser. Mr. Duncan testified that, in consultation with Mr. Barry, he determined that the highest and best use of the Property would involve the development of eighteen town homes on it. He factored into his analysis a discount of fifteen percent based on the risk associated with real estate. He therefore determined that fifteen units and fifteen boat slips, rather than eighteen, would be a more appropriate estimate of what a developer could expect for the highest and best use. Mr. Duncan opined, to a reasonable degree of certainty as an expert real estate appraiser, that the fair market value of the Property as of the date of taking, ignoring the public project, was $1,950,000.00. The court received Mr. Duncan's appraisal report in evidence, but, at the City's behest and over appellants' objection, redacted two pages of the report that discussed a 2003 Maryland State Department of Assessment and Taxation ("SDAT") tax assessment.
Appellants then moved into evidence an SDAT tax assessment for 1988, which was in effect at the time Ordinance 412 was passed. The court refused to receive the tax assessment in evidence. The court did *778 receive into evidence a copy of Ordinance 412.[6]
In lieu of calling Mr. Zografos to testify, the parties stipulated that if he were to testify, he would state "that he does not have any opinion as to the fair market value of the [P]roperty other than what Mr. Duncan [] testified to." Appellants then concluded their case.
The jury returned an inquisition awarding $300,000.00 to appellants as just compensation for the Property.
We shall add facts as they become pertinent to our discussion.
DISCUSSION
I.
The City's Eminent Domain Authority
We begin our analysis of appellants' claims by reviewing the City's power of eminent domain and its authority in quick-take condemnation proceedings.
The City's eminent domain authority in this case is derived from Article III, § 40A of the Maryland Constitution, Title 12 of the Real Property Article, the Charter of Baltimore City, and CPLBC § 21-16. "Eminent domain, in its simplest terms, is the `inherent power of a governmental entity to take privately owned property . . . and convert it to public use. . . .'" J.L. Matthews, Inc. v. Maryland-National Capital Park & Planning Comm'n, 368 Md. 71, 87, 792 A.2d 288 (2002) (quoting BLACK'S LAW DICTIONARY 541 (7TH ed. 1999)); see also County Comm'rs of Frederick County v. Schrodel, 320 Md. 202, 215, 577 A.2d 39 (1990) (stating that the sovereign needs no constitutional authority to enjoy the power of eminent domain).
A governmental entity's power of eminent domain is subject to limitations under "Article III, § 40 of the Maryland Constitution, together with the Fifth and Fourteenth Amendments to the United States Constitution . . . ." J.L. Matthews, 368 Md. at 87, 792 A.2d 288.[7] These provisions limit the sovereign's authority "by requiring that the taking of private property by governmental entities `be for public use and that just compensation be paid.'" Id. (citations omitted). See also Schrodel, 320 Md. at 215, 577 A.2d 39. *779 Moreover, the General Assembly has exclusive discretion over "[t]he mode and manner of the exercise of the power of eminent domain[.]" J.L. Matthews, 368 Md. at 87, 792 A.2d 288 (citations and internal quotation marks omitted).
II.
Diminution in Value Evidence
Before trial, the City filed a motion in limine to preclude appellants from introducing two tax assessments from SDAT: one performed in December 1987 and effective July 1, 1988, seventeen months before the City approved Ordinance 412 in 1989; and one performed in January 2003 and effective July 1, 2003, several months after the City instituted condemnation proceedings in November 2002. The City argued that appellants could introduce evidence of the SDAT tax assessment in effect on the date of the taking, i.e., November 21, 2002, but not any other tax assessment, because no other assessment was relevant to the fair market value of the Property as of the date of taking.
Appellants countered that RP § 12-105(c) explicitly authorizes a property owner, in certain circumstances, to introduce an SDAT tax assessment. They argued that the statute does not limit a property owner to use of only the tax assessment in effect on the date of taking. They argued, moreover, that the 1989 and 2003 tax assessments are relevant to the determination of whether Ordinance 412 caused a diminution in the value of the Property.
The court granted the City's motion in limine. The court determined that, although the statute did not identify which tax assessments are relevant, the statute implies that the only relevant assessment is the one in effect on the date of taking, because that date is the only date relevant to a jury's determination of just compensation.
During trial, the court denied appellants' attempt to elicit from their expert appraisal witness, Mr. Duncan, evidence of a diminution in the value of the Property proximately caused by Ordinance 412:
[Appellants' counsel:] Okay. And additionally, Mr. Duncan, . . . are you aware of the definition of fair market value that provides for a consideration of diminution in value between the date of legislative enactment and the date of take?
[Mr. Duncan:] Yes, I am.
[Appellants' counsel:] And briefly what is your understanding of that provision?
[Mr. Duncan:] Well, basically what it provides for is if there's a, an announcement of the public project and the property is not taken until sometime later, that if the property deteriorates in value, deteriorates in some form or fashion, that the property owner's entitled to compensation for that.
[Appellants' counsel:] And, and based on your investigation of the subject property and knowing what you, and knowing that the announcement [of the public park project] and the effective legislation was in 1989, did you find there to be any evidence of a diminution in value between 1989 and November of 2002?
[The City's counsel]: Objection.
The Court: Sustained.
The court received Mr. Duncan's appraisal report, but, over appellants' objection, redacted the references in it to the 2003 property tax assessment. The court also refused to admit the 1988 property tax assessment, when offered by appellants.
*780 Appellants challenge the court's exclusion of the 1988 and 2003 tax assessments as well as Mr. Duncan's expected testimony on diminution of value. They argue that both tax assessments and Mr. Duncan's testimony are relevant to establish that the value of the Property diminished as a result of the enactment of Ordinance 412.
Appellants did not proffer what Mr. Duncan's testimony would have been. Generally, "the question of whether the exclusion of evidence is erroneous and constitutes prejudicial error is not properly preserved for appellate review unless there has been a formal proffer of what the contents and relevance of the excluded testimony would have been." Mack v. State, 300 Md. 583, 603, 479 A.2d 1344 (1984).
The City makes no argument that appellants have not properly preserved for appellate review the admissibility of Mr. Duncan's diminution-of-value testimony. At oral argument before us, appellants' counsel stated that he had made plain to the circuit court exactly what Mr. Duncan's testimony on the issue would have been. The record does not support that representation, however.
We shall not speculate about all of what Mr. Duncan might have said on the subject of diminution in value. Nevertheless, given that the City makes no argument of non-preservation and that the record indicates that Mr. Duncan would have testified, at the least, about the 2003 tax assessment and likely about the 1988 assessment as well, we shall address whether the court committed prejudicial error by precluding evidence of both assessments, whether through Mr. Duncan, his report, or the assessments themselves.
We begin by recognizing that the jury's role in condemnation cases is to "resolve[] factual disputes relating only to just compensation and [to] fix[] the amount of compensation." Utilities, Inc. of Maryland v. Washington Suburban Sanitary Comm'n, 362 Md. 37, 48, 763 A.2d 129 (2000) (emphasis added). This task requires the jury to determine the "fair market value" of property in a quick-take condemnation proceeding. Bern-Shaw Ltd. P'ship v. Mayor & City Council of Baltimore, 377 Md. 277, 288, 833 A.2d 502 (2003); see also RP § 12-104(a) (providing that "[t]he damages to be awarded for the taking of land is its fair market value").
RP § 12-105(b) defines fair market value as follows:
The fair market value of property in a condemnation proceeding is the price as of the valuation date for the highest and best use of the property which a vendor, willing but not obligated to sell, would accept for the property, and which a purchaser, willing but not obligated to buy, would pay, excluding any increment in value proximately caused by the public project for which the property condemned is needed. In addition, fair market value includes any amount by which the price reflects a diminution in value occurring between the effective date of legislative authority for the acquisition of the property and the date of actual taking if the trier of facts finds that the diminution in value was proximately caused by the public project for which the property condemned is needed, or by announcements or acts of the plaintiff or its officials concerning the public project, and was beyond the reasonable control of the property owner.
(Emphasis added.)
Under RP § 12-105(b), two dates are relevant to the question of diminution in value. The first is "the effective date of legislative authority for the acquisition *781 of the property," which, under RP § 12-105(a), "means, with respect to a condemnor vested with continuing power of condemnation, the date of specific administrative determination to acquire the property." The second is the "valuation date" for establishing fair market value.
Ordinance 412, approved on November 17, 1989, authorized the taking of the Property for the purpose of building a public park. Ordinance 412 provides, moreover, that it was passed to authorize the City to acquire the Property in fee simple "by purchase or by condemnation, for urban renewal purposes . . . ." Plainly, the date of approval of Ordinance 412, November 17, 1989, constitutes the effective date of legislative authority for the acquisition of the Property.
The "valuation date" for purposes of determining fair market value of the Property is November 21, 2002. That is the date the City commenced formal quick-take condemnation proceedings in the circuit court and deposited $260,000.00 into the court's registry. See Bern-Shaw, 377 Md. at 282, 833 A.2d 502; RP §§ 12-102, 12-103.
The time period for purposes of diminution in value is the thirteen years between November 17, 1989, and November 21, 2002.
Appellants maintain that both the 1988 and 2003 tax assessments were admissible under RP § 12-105(c), and that they were relevant to show a diminution in value, which was proximately caused by the approval in 1989 of Ordinance 412. Appellants argue that the General Assembly, by enacting RP § 12-105(c), intended that any SDAT tax assessment, without regard to its date, is admissible if offered by a defendant property owner, so long as the assessed value exceeds the condemning authority's appraisal value.
The City responds that RP § 12-105(c) only contemplates as relevant a tax assessment that is in effect as of the taking date. At oral argument before us, however, the City conceded that a tax assessment for a time period before the taking date may be relevant to diminution in value. The City argued, however, that appellants did not establish the relevance of the 1988 and 2003 assessments. The City asserts, moreover, that the court properly refused to receive the 1988 SDAT tax assessment because the City did not have the benefit of deposing or cross-examining the official who conducted the assessment. The City also argues that, even if the court erred, appellants were not substantially prejudiced by the error; therefore, the jury's inquisition should not be disturbed.
The general rule in condemnation proceedings is that a property tax assessment "`made by public authorities for purposes of taxation is not admissible in condemnation proceedings.'" E.L. Gardner, Inc. v. Bowie Joint Venture, 64 Md.App. 302, 308, 494 A.2d 988, cert. denied, 304 Md. 296, 498 A.2d 1183 (1985) (quoting Baltimore City v. Himmel, 135 Md. 65, 75-76, 107 A. 522 (1919)).[8] It has been said that "[a] common rationale for the [] rule . . . is that it is common knowledge that [tax] assessors do not assess property at market value, and that such valuations are made for a purpose other than determination of true or market value." C.C. Marvel, Valuation for taxation purposes as admissible to show value for other purposes, *782 39 A.L.R.2d 209 § 7 (1955) (footnote omitted).
RP § 12-105(c), however, explicitly provides for instances when a defendant property owner, in a condemnation proceeding, may present evidence of the assessed value of the condemned property. Subsection (c) states:
The defendant property owner may elect to present as evidence in a condemnation proceeding, the assessed value of the property, as determined by the Department of Assessments and Taxation, if the assessed value is greater than the appraised value placed on the property by the condemning authority.
We have found no cases interpreting the language of this subsection. We thus have the task of construing it.
"`[T]he cardinal rule of statutory interpretation is to ascertain and effectuate the intention of the [legislative body].'" Motor Vehicle Admin. v. Jones, 380 Md. 164, 175, 844 A.2d 388 (2004) (quoting Holbrook v. State, 364 Md. 354, 364, 772 A.2d 1240 (2001)). The analysis begins with the language of the statute itself. Western Corr. Inst. v. Geiger, 371 Md. 125, 141, 807 A.2d 32 (2002). We assign words in a statute their ordinary and natural meaning. O'Connor v. Baltimore County, 382 Md. 102, 113, 854 A.2d 1191 (2004). "[S]tatutory language is not read in isolation, but `in light of the full context in which [it] appear[s] . . .'" Knight v. Princess Builders, Inc., 162 Md. App. 526, 531, 875 A.2d 771 (2005) (citations omitted). "If the plain language of the statute is unambiguous and is consistent with the statute's apparent purpose, we give effect to the statute as it is written." Comptroller of the Treasury v. Phillips, 384 Md. 583, 591, 865 A.2d 590 (2005).
The appellate court "will look `beyond the statute's plain language in discerning the legislative intent' only where the statutory language is ambiguous." Jones, 380 Md. at 176, 844 A.2d 388 (citation omitted). Language in a statute is ambiguous if there is more than one reasonable interpretation of it. Phillips, 384 Md. at 591, 865 A.2d 590. "If the statutory language is ambiguous or unclear, we look to legislative history, prior case law, and statutory purpose." Id.
Applying these rules of construction, we note at the outset that subsection (c) does not expressly preclude a property owner from presenting evidence of a tax assessment other than the assessment in effect at the time of taking. Furthermore, when subsection (c) is read in the context of the remainder of RP § 12-105, it is plain that a property owner is not precluded from presenting other tax assessments, so long as the assessed value exceeds the condemning authority's appraisal.
RP § 12-105(b) states that fair market value of property in a condemnation proceeding "includes any amount by which the price reflects a diminution in value occurring between the effective date of legislative authority for the acquisition of the property and the date of actual taking if the trier of fact finds that the diminution in value was proximately caused by the public project for which the property condemned is needed[.]"
Subsection (c), in turn, authorizes a property owner to present evidence of the assessed value of the condemned property, if the assessed value is higher than the condemning authority's appraisal. Read together with subsection (b), subsection (c) reflects the General Assembly's intent to give a property owner the ability to counter a condemning authority's appraisal value, which constitutes the condemning authority's opinion of fair market value, with evidence that, at a time relevant *783 to the determination of fair market value, the State assessed the property at a higher value. We conclude that RP § 12-105(c) does not limit its applicability only to the assessment that is current as of the time of the taking.
The Property was assessed by the SDAT in 1988 at a value of $528,810.00, more than 100 percent higher than the City's higher appraisal of $260,000.00, made some months before the actual taking in 2002. Seventeen months after the July 1, 1988 effective date of the 1988 tax assessment, the City enacted Ordinance 412, authorizing the taking of the Property.
The 1988 assessment satisfies the criterion for admissibility set forth in RP § 12-105(c), because it is higher (indeed far higher) than the appraisal. That alone does not guarantee the admissibility of the 1988 assessment, however. The assessment must pass the threshold of relevance. See Md. Rule 5-402.
Pertinent to our determination of whether the 1988 tax assessment is relevant are two evidentiary propositions: (1) "no evidence that is alleged to relate to the fair market value of a property involved in a condemnation proceeding is properly admissible at trial unless it is actually relevant"; and (2) "[t]he general rule in this State is that all evidence that is relevant to a material issue is admissible except as otherwise provided by statutes or by rules applicable in Maryland courts." Bern-Shaw, 377 Md. at 289-90, 833 A.2d 502 (citations and internal quotation marks omitted). See also Md. Rule 5-402. We review a trial court's rulings on the admissibility of evidence under two very different standards. When a court's ruling involves "a discretionary weighing of relevance in relation to other factors," we review the ruling on an abuse of discretion standard. Bern-Shaw, 377 Md. at 291, 833 A.2d 502. If the court's ruling is a purely legal issue, we review the ruling de novo. Id.
In the present case, the court stated that it granted the City's motion in limine because RP § 12-105(c) implied that the only relevant tax assessment is the assessment in effect at the time of the taking. We have concluded that the statute permits other tax assessments to be presented by the property owner, so long as the statutory criterion is met. The court's refusal to permit appellants to place into evidence the 1988 tax assessment was based on a misreading of the statute and was, therefore, legally wrong.
Because the court decided the issue as it did, it did not reach the question whether the 1988 tax assessment was relevant to the question of the value of the Property on the date of taking. We are satisfied that, on this record, the 1988 tax assessment was relevant to establish that the enactment of Ordinance 412 proximately caused a diminution in the value of the Property. Cf. Mayor & City Council of Baltimore v. United Five & Ten Cent Stores, Inc., 250 Md. 361, 243 A.2d 521 (1968) (construing former Maryland Code (1967 Repl. Vol.), Article 33A, § 6, the predecessor to RP § 12-105(c), as allowing the jury in a condemnation proceeding to consider, as evidence of diminution in value, an ordinance that pre-dated the ordinance that authorized the taking of the property, because the earlier ordinance constituted an announcement by public officials concerning the property that could have proximately caused a diminution in value of the property).
The City urges that, even if the court erred in disallowing evidence of the 1988 tax assessment, appellants were not substantially prejudiced by the ruling and, therefore, are not entitled to a retrial. *784 The City relies on State Roads Comm'n v. Kuenne, 240 Md. 232, 213 A.2d 567 (1965), as support for its argument.
The City's reliance on Kuenne, supra, is misplaced. In Kuenne, the Court of Appeals held that the trial court erred when it denied the condemnor's motion to strike the testimony of a landowner that he based his estimate of the property's value on a purchase "offer." Id. at 235, 213 A.2d 567. The Court then analyzed whether the condemnor was prejudiced by the landowner's testimony, and determined that reversal was not warranted. The Court recognized that the level of prejudice that must be shown to reverse a jury's inquisition must be substantial:
"Courts are reluctant to set aside verdicts for errors in the admission or exclusion of evidence unless they cause substantial injustice. This is especially true in condemnation proceedings. Such cases usually consume much time in trial and are expensive in nature. As a rule, they are determined by a myriad of different items of evidence. The exclusion or admission of small items of evidence of doubtful materiality are not likely to be of great importance in the outcome of the case, and most courts refuse to set aside a verdict in cases of this kind, for error in the rulings on questions of evidence, unless, as indicated above, substantial prejudice be shown."
Id. (quoting Hance v. State Roads Comm'n, 221 Md. 164, 176, 156 A.2d 644 (1959)).
Applying the test of substantial prejudice, the Kuenne Court noted that the actual inquisition returned by the jury was only slightly higher than the market value fixed by the expert witnesses. The Court also found persuasive that, at the time of the taking, it was difficult to state the fair market value of the property with certainty. The Court noted, however, that if the jury's award had been closer to the amount testified to by the landowner (which would have indicated that the testimony influenced the jury), then the error in admitting the testimony would have been prejudicial to the condemnor. Id. at 235-36, 213 A.2d 567.
Kuenne is easily distinguishable from this case. Kuenne did not involve error that resulted in a party's inability to present evidence that is expressly permitted by statute. Moreover, in Kuenne, the Court could safely conclude that no prejudicial error resulted from the jury's hearing the inadmissible testimony, because the jury returned an inquisition that was not even close to the landowner's inadmissible testimony of fair market value.
In the present case, the jury returned an inquisition close to the highest value presented by the City and, conceivably, far lower than an inquisition that could have been returned had the jury heard testimony supporting appellants' diminution in value theory. For this reason, we hold that appellants were substantially prejudiced by the court's exclusion of the 1988 tax assessment. Our holding requires that the judgment reflecting the jury's valuation be vacated, and the case be remanded for a new trial.
The court did not err or abuse its discretion, however, in refusing to permit appellants to introduce the 2003 SDAT tax assessment, which valued the Property at $661,800.00. We explain.
Throughout most of the trial, appellants maintained that the date of taking in this case was November 21, 2002. Deep into their case, however, relying on testimony of a City witness that the City did not actually enter the Property and take it until after February 2003, appellants asserted that the taking date was not until *785 sometime after January 1, 2003. On this premise, appellants sought admission of the 2003 tax assessment because it was the first assessment made after the City actually began constructing the public park.
RP § 12-105(c) does not contemplate introduction of the 2003 tax assessment, on the facts of this case. As we have said, RP § 12-105(c) authorizes a defendant property owner to elect to present evidence of a tax assessment that is higher than the condemning authority's appraisal value for the purposes of determining fair market value. We stated earlier in this opinion that the date of taking in this case is November 21, 2002. The 2003 tax assessment does not come within the statute because it was conducted after the date of taking and therefore had no bearing on any diminution in value that occurred between the date of legislative enactment authorizing the taking of the property and the actual date of taking.
III.
The Witnesses' Testimony
Appellants argue that the court erred in refusing to strike the testimony of Ms. Clark and the opinions of the City's expert appraisers. The City responds that the court properly admitted the testimony of Ms. Clark because her testimony was relevant to the issue of improving the Property. Regarding the expert appraisers' testimony, the City argues that the court did not err because, in expressing an opinion of fair market value, both experts indicated that the designation of the Property for a public park "was not a factor in their consideration." We consider each argument in turn.
Through the testimony of Ms. Clark and others, the City presented evidence of post-taking "improvements" made to the property in connection with Ordinance 412. Ms. Clark testified that the improvements cost the City "roughly $2.6 million." Ms. Clark's testimony concerning the cost to improve the Property to construct a public park was inadmissible.
When determining what constitutes just compensation for condemned property, the jury "must disregard the effect of the public project[] for which the property is acquired[.]" Bonaparte v. Mayor & City Council of Baltimore, 131 Md. 80, 83, 101 A. 594 (1917) (holding that a valuation of condemned property must consider all potential uses of the property). Furthermore, a valuation of condemned property that takes into account the pending condemnation is inadmissible. See Congressional School of Aeronautics, Inc. v. State Roads Comm'n, 218 Md. 236, 249-50, 146 A.2d 558 (1958) (excluding the testimony of a witness who, when estimating the market value of condemned property, considered the limited time that a prospective buyer would be able to use the property before it would be taken for highway widening). These cases reflect the principle that the effect of the public project should be ignored in calculating fair market value. That principle has been codified in what is today RP § 12-105(b), which specifically provides that the determination of fair market value should "exclud[e] any increment in value proximately caused by the public project for which the property condemned is needed."
Turning to this case, the jury's task was to determine the fair market value of the Property. The "increment in value proximately caused" by the public project, i.e., the park, was to be excluded from that determination. Yet the City, rather than ignoring the public project, put before the jury the testimony of Ms. Clark that $2.6 million was spent to "improve" the Property. The City does not identify any authority, and we have found none, *786 that supports the admissibility of evidence of the cost to improve property in furtherance of a public project after the condemning authority has taken the property for public use. To the contrary, the above authorities support appellants' position that such evidence is inadmissible. On retrial, the City should not be permitted to introduce evidence of the cost to the City of its improvements to the Property.
We turn now to the testimony of the City's expert appraisers, Mr. Gordon and Mr. Thomas. Appellants argue that the court erred in refusing to strike those witnesses' testimony because they each considered the designation of the Property for public park use only in rendering an opinion of the Property's fair market value. The City responds that both experts indicated by their testimony that they did not factor into their analysis the designation of the Property for public park use.
Only relevant evidence is admissible at trial. See Md. Rule 5-402. "[I]n order for an expert's appraisal to have any relevance, it must be in accordance with the statutory definition" of fair market value. Stickell v. Mayor & City Council of Baltimore, 252 Md. 464, 473, 250 A.2d 541 (1969).
We do not agree with appellants' interpretation of the experts' testimony. Mr. Gilbert's opinion that the fair market value of the Property was approximately $260,000.00 was derived from the report he had prepared. That report included a reference to the Property having been designated for use as a public park.
At the conclusion of Mr. Gilbert's testimony, appellants moved to strike it, arguing that his response to a question posed by the court reflected that he did not exclude any increment in value proximately caused by the public park project. The court denied the motion to strike any of Mr. Gilbert's testimony, having concluded that Mr. Gilbert's opinion was evidently unaffected by his knowledge that the Property was designated by the City for public park use only.
We have reviewed Mr. Gilbert's testimony and his report, and we discern nothing in either that called into question the admissibility of his opinion of the fair market value of the Property, or required that his testimony should have been excluded in all or in part. It seems to us that appellants' arguments for striking Mr. Gilbert's testimony go to the weight of it, not its admissibility.
The court likewise did not err in refusing appellants' request to strike the opinion of Mr. Thomas. Mr. Thomas testified that, in his opinion, the Property had no fair market value because it would have cost more to develop the Property than what one could profit from the development. When asked whether his opinion of fair market value would be different if the City had never designated the Property for public park use only, Mr. Thomas testified that he would have reached the same conclusion because of, inter alia, the condition of the Property. Again, appellants' arguments go to the weight of Mr. Thomas's testimony, not to its admissibility.
IV.
The Jury Instructions
Appellants argue that the court erred in refusing to give two of their proposed instructions concerning the irrelevance of the public park project to the determination of fair market value of the Property. Appellants concede that the instructions given properly state the law. They assert, however, that the court erred because "nothing in the [court's] instruction[s] addressed the requirement that the jury should disregard the effect of the public *787 park project and the fact of the authorizing ordinance."
The City responds that the court properly instructed the jury on the applicable law. The City asserts that the instructions given by the court "mirrored," "almost verbatim," the statutory definition of fair market value. The City also argues that the court committed no error under Maryland Rule 2-520(c).
Maryland Rule 2-520(c) governs jury instructions and provides: "The court may instruct the jury, orally or in writing or both, by granting requested instructions, by giving instructions of its own, or by combining any of these methods. The court need not grant a requested instruction if the matter is fairly covered by instructions actually given." See also Boone v. American Mfrs. Mut. Ins. Co., 150 Md.App. 201, 225, 819 A.2d 1099 (2003) (stating "a trial court must properly instruct the jury on a point of law that is supported by some evidence in the record"), cert. denied, 376 Md. 50, 827 A.2d 112 (2003).
When we review a trial court's ruling to grant or deny a requested jury instruction, we consider "`whether the requested instruction was a correct exposition of the law, whether that law was applicable in light of the evidence before the jury, and finally whether the substance of the requested instruction was fairly covered by the instruction actually given.'" Burdette v. Rockville Crane Rental, Inc., 130 Md.App. 193, 212, 745 A.2d 457 (2000) (citations omitted). "[S]o long as the law is fairly covered by the jury instructions, reviewing courts should not disturb them." Farley v. Allstate Ins. Co., 355 Md. 34, 46, 733 A.2d 1014 (1999).
In the present case, the court instructed the jury regarding its assessment of fair market value as follows:
The fair market value in a condemnation proceeding is the price as of the valuation date, November 21, 2002, for what we call the highest and best use of the property, which a seller, willing but not obligated to sell, would accept for the property and which a purchaser, willing but not obligated to buy, would pay excluding any increment in value proximately caused by the public project for which the property is condemned.
The highest and best use of the property is the most profitable potential use the property has on the date of taking. In addition, I would say to you that what we mean when we say fair market value includes any amount by which the price reflects a diminution in value occurring between the effective date of the legislative authority for the acquisition of the property and the date of the actual taking. If you find that the diminution in value was proximately caused, if you find any diminution in value at all, and if you find that such diminution in value as you might find was proximately caused by the public project for which the property condemned is needed, or by announcements or acts of the Plaintiff, the Plaintiff being the [City], the condemning authority, or any of its officials concerning the public property or public project rather, and it was beyond the reasonable control of the property owners.
The court's instructions essentially mirrored the statutory definition of fair market value in condemnation cases. See RP § 12-105(b). The instruction given was "a correct exposition of the law."
Appellants asked the court to add to those instructions the following instructions:
In determining the fair market value of the property as of the date of value, *788 you must consider all the uses to which the property could have been applied as if the public project was neither announced, planned or constructed, and you must award the defendants what you believe would have been the property's fair market value under the circumstances mentioned, if employed for the most profitable use for which you find it could have been applied, whether in fact applied to such use or not. In other words, in determining fair market value, you must disregard the effect of the public project, for which the property was acquired, but must take into consideration all the uses to which the property is (or was) capable of being applied at the time of the taking in November 2002.
You are instructed that, when these instructions refer to the "public project," this means the preparation of the land, fastland and bulkheads for, and construction of, a public park on the subject property located at 910 South Bond Street.
You are further instructed that, when these instructions refer to the "effective date of legislative authority for the acquisition of the property" this means the approval of [Ordinance 412] in November 1989, which both designated the subject property as permitting only public park use and authorizing the City to acquire the subject property for that public project.
We have said that the jury's role in condemnation cases is to resolve factual disputes relating to compensation and to determine the amount of compensation. See Utilities, 362 Md. at 48, 763 A.2d 129. The requested instructions would have likely aided the jury in understanding the case and the applicable law.
Indeed, the requested instructions incorporated the evidence presented to the jury and directly complied with long-standing legal principles governing condemnation cases. See Brinsfield v. Mayor & City Council of Baltimore, 236 Md. 66, 73, 202 A.2d 335 (1964) (stating that where a "property was condemned for the purpose of clearing a so-called slum area," "the jury should not consider either increase or diminution in the value because of the use to which the property is to be put"); Congressional School of Aeronautics, Inc., 218 Md. at 249-50, 146 A.2d 558 (stating "that evidence of value based upon the effect of the taking involved in a pending condemnation suit is inadmissible," and holding that the opinion of the condemning authority's expert appraiser concerning market value should have been struck because it was based, in part, "upon the limited time for which a prospective, willing purchaser might be able to use the property because of the prospect of its being taken for the highway widening which gave rise to this suit"); Bonaparte, 131 Md. at 83, 101 A. 594 (stating that, in determining fair market value, a jury should consider the uses for which a property can be applied without regard to whether that use has been applied, and that the jury "must disregard the effect of the public project, for which the property is acquired, but must take into consideration all the uses to which it is capable of being applied at the time of the appropriation and which affect its marketability").
Because we are vacating the judgment on other grounds, we need not decide whether the court committed reversible error by refusing to give the additional instructions requested by appellants. We note, however, that the court would not have abused its discretion (and perhaps would have taken the better course of action) by instructing the jury not to consider the effect of the public project in determining the value of the Property.
*789 JUDGMENT OF THE CIRCUIT COURT FOR BALTIMORE CITY, AND THE INQUISITION UPON WHICH IT IS BASED, VACATED. CASE REMANDED FOR NEW TRIAL.
COSTS TO BE PAID BY THE MAYOR & CITY COUNCIL OF BALTIMORE.
NOTES
[1] CPLBC § 21-16 is titled, "`Quick-take' condemnationin general." Subsection (a) of that section provides that, when the City institutes a proceeding for the taking of private property for public use, it "may file a Petition under oath stating that it is necessary for the City to have immediate possession of, or immediate title to and possession of, said property, and the reasons therefore."
[2] The other appellants include Juliet S. Sackleh, Polyxeni Pentakalos, Kosmas Ioannis Pentakalos, Odysseas Ioannis Pentakalos, and Themistoklis Ioannis Pentakalos, each of whom was named as a party defendant in the City's condemnation petition.
[3] Section 7-401 of the Zoning Code of Baltimore City provides that "[t]he M-3 Industrial District is designed for industrial, manufacturing, and related activities generally known and described as `heavy industry.'"
[4] Article 13 of the Baltimore City Code ("BCC") authorizes the creation of urban renewal plans in Baltimore City. BCC § 2-5(b)(1) provides:
As used herein a Renewal Plan means a plan, as it exists from time to time, for the elimination, correction, or the prevention of the development or the spread of slums, blight, or deterioration in an entire Renewal Area or a portion thereof. . . .
[5] Maryland Rule 12-207(a) provides: "An action for condemnation shall be tried by a jury unless all parties file a written election submitting the case to the court for determination. All parties may file a written election submitting an issue of fact to the court for determination without submitting the whole action."
[6] Appellants informed the court that the City had agreed to redact from the appraisal reports of Mr. Gilbert and Mr. Thomas the SDAT tax assessment record in effect as of the date of taking. The appraisal reports have been made a part of the record on appeal. Page nine of Mr. Thomas's report includes a reference to the Property's having been assessed with a "full cash value" equal to the amount stated in the 2002 SDAT tax assessment. We assume, then, that the reference to the 2002 tax assessment was not redacted from the report. By statute, only the property owner may elect to present an SDAT tax assessment in a condemnation proceeding, "if the assessed value is greater than the appraised value placed on the property by the [City]." RP § 12-105(c).
[7] Article III, § 40 of the Maryland Constitution provides:
The General Assembly shall enact no Law authorizing private property, to be taken for public use, without just compensation, as agreed upon between the parties, or awarded by a Jury, being first paid or tendered to the party entitled to such compensation.
The Fifth Amendment to the United States Constitution provides, in pertinent part: "nor shall private property be taken for public use, without just compensation." The "takings clause" of the Fifth Amendment is made applicable to the States through the due process clause of the Fourteenth Amendment. Mercantile-Safe Deposit & Trust Co. v. Mayor & City Council of Baltimore, 308 Md. 627, 640 n. 3, 521 A.2d 734 (1987) (citing Chicago B & Q R'd Co. v. Chicago, 166 U.S. 226, 17 S.Ct. 581, 41 L.Ed. 979 (1897), and King v. State Roads Comm'n, 298 Md. 80, 83, 467 A.2d 1032 (1983)).
[8] Himmel, supra, 135 Md. 65, 107 A. 522, is a condemnation case that predates by over forty years the enactment of the language in Article 33A, § 6, the predecessor to RP § 12-105(c), authorizing a condemnee to introduce evidence of a tax assessment. See 1966 Laws of Maryland Ch. 149.
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Electronically Filed
Intermediate Court of Appeals
CAAP-11-0000608
23-NOV-2012
09:54 AM
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529 S.W.2d 423 (1975)
E. C. S., f/k/a E. C. L., Plaintiff-Appellant,
v.
J. D. L., Defendant-Respondent.
No. 35994.
Missouri Court of Appeals, St. Louis District, Division One.
August 5, 1975.
Motion for Rehearing or Transfer Denied October 22, 1975.
Application to Transfer Denied December 8, 1975.
*424 Newmark & Baris, Irl Baris, Kenneth H. Graeber, St. Louis, for plaintiff-appellant.
Bryan, Cave, McPheeters & McRoberts, Dennis C. Donnelly, St. Louis, for defendant-respondent.
WEIER, Presiding Judge.
This appeal arises from an order of the Circuit Court of the County of St. Louis modifying a decree of divorce.
On July 18, 1969 a decree of divorce was granted to the plaintiff-wife. She was also awarded the care, custody, and control of the three minor children born of the marriage. The defendant-husband was given visitation rights and temporary custody of the children and ordered to pay $200.00 monthly child support. A stipulation by the parties was also made part of the divorce decree in which the defendant had agreed to pay up to $1,000.00 medical and dental expense and $7,000.00 educational expense per year with provisions that the amounts might be increased.
In October of 1969, three months after the decree of divorce, the plaintiff was adjudicated incompetent by the Probate Court of St. Louis County, and a guardian for her person and estate was appointed. The actual physical custody of the three children remained with the defendant although their legal custody had been given to plaintiff. But on July 6, 1972 the decree of divorce was modified giving the defendant legal custody of the children "until July 1st next following a final judgment of restoration of the divorced wife * * * at which time * * * she * * * shall have the general care, custody and control of said minor children." The plaintiff's guardian was ordered to pay defendant $333.33 monthly in support of each child.
In April, 1973 defendant filed a motion to modify the 1972 decree, requesting that he be given custody of the children and to delete the provision to return their custody to plaintiff in July. Hearings on defendant's motion did not begin until August, *425 1973. But prior to this, on July 1, 1973, for the first time the children left their father to reside with their mother who had been restored in August of 1972.
On December 28, 1973 the order was entered which sustained the defendant's motion in part and denied it in part. Defendant was awarded custody of the oldest son, then fifteen years of age, and plaintiff was awarded custody of the two younger children, a girl, twelve, and a boy, nine. The order further provided that with an exception with respect to medical insurance, "neither party shall be obligated to pay the other any sum for the maintenance, support, care or custody of the minor children or for their medical, dental, orthodontic, psychiatric, educational, transportation, entertainment or other expenses of any kind." Additionally, the order granted each party temporary custody of all three children for various times during the year.
Plaintiff is before us contending the 1973 modification, which divided the children's general custody between the parents and ended all support payments and monetary obligations between each party, is error. The first point plaintiff relies on is that it was error to grant the defendant custody of the older boy because there was no proof of any change of circumstances to justify a modification of the 1972 order, or that plaintiff was an unfit mother, or that it was in the children's best interest to be separated.
Initially we must admit that the determination of the proper custody of children is not an easy or pleasant task. There are no fixed and clear rules to be followed; rather each case must be decided according to its own particular facts, always remembering the primary objective is to reach a result which is in the best interest and welfare of the children. Wood v. Wood, 400 S.W.2d 431, 436[1] (Mo.App.1966). Furthermore, we recognize that the determination of all factual issues in a proceeding on motion for modification of custody provisions of divorce decree on grounds of material changes in circumstances is initially vested in the discretion of the trial court, and its findings should be deferred to unless in conflict with the clear preponderance of the evidence and disclose a manifest abuse of discretion. Pelts v. Pelts, 425 S.W.2d 269, 270[4] (Mo.App.1968).
Defendant filed a bill of particulars in which he explicitly alleged changed circumstances had occurred since the 1972 order. The primary dispute revolved around the plaintiff's problem of alcoholism and whether in fact she still has one since her restoration. Most of the evidence on this point was from the three minor children, and their testimony was at best ambiguous and inconsistent. We see no useful purpose in making a permanent record of the details of this controversy. See Pelts v. Pelts, supra at 270[4]. In fact, in this case we largely discount the reciprocal charges of unfitness and misconduct which the parties have made. Obviously, each tends to magnify the other's faults. The law does not demand that parents be perfect, and the comparative merits are not substantial factors in this case since the trial court in fact found both to be fit parents when it awarded each one custody of a child. The real question is whether the trial court's award of custody best serves the interests of the children themselves. J. v. E., 417 S.W.2d 199, 203[1, 2] (Mo.App.1967).
Plaintiff correctly asserts that the party seeking modification of a custody provision has the burden to show a change in circumstances. See Gori v. Gori, 490 S.W.2d 282, 283[1] (Mo.App.1973); Wood v. Wood, supra, 400 S.W.2d 431, 436[2]; C. S. v. R. J. S., 488 S.W.2d 663, 665[2] (Mo.App.1972). But this burden must be viewed in the light of the best interest and welfare of the children. C. S. v. R. J. S., supra at 665[3]. The court is entitled to inquire very broadly to determine whether the previous decree serves the children's best interest in the light of actual experience and subsequent developments. J. v. E., supra, 417 S.W.2d at 203[4]. After the first modification, *426 plaintiff was restored. Defendant alleged in his subsequent motion a problem of alcoholism that continued after recovery of competency. Some evidence adduced supported this allegation. Such a problem has a vital effect on the best interest of the children. Such circumstances give rise here to a change of condition.
As to the separation of the children, we recognize that it has frequently been held that absent exceptional circumstances the children of divorced parents should not be separated. But it is clearly within the discretionary power of the trial court to make such a division if it is for the best interest of the children to do so. J. v. E., supra at 203[7-8].
The oldest boy is now sixteen years old, an age at which courts have generally noted the guidance and discipline of his father is most important. See J. v. E., supra at 204[10-12]; Meredith v. Krauthoff, 191 Mo.App. 149, 177 S.W. 1112, 1123 (1915). Additionally, the record demonstrates that the boy was not happy in the custody of his mother and voiced a preference to living with his father. Missouri law now specifically recognizes that the child's wishes are to be a relevant factor in the custody decision. § 452.375, RSMo Supp.1973. Although this statute was not yet in effect at the time of the decree in question (see § 452.415, RSMo Supp.1973), Missouri courts have long acknowledged the right of the trial court to consider and give controlling weight to the wishes of a minor child provided the child is sufficiently mature to formulate and express a rational opinion and desire as to its custody. Fenton, "The Minor's Rights in a Divorce Proceeding", 29 Mo.Bar J. 450 (1973). See Engler v. Engler, 455 S.W.2d 36, 41[5] (Mo.App.1970); J. v. E., supra, 417 S.W.2d at 203[5-6]. The boy was almost fifteen years old when he testified and the record demonstrates an extensive questioning by the trial judge so that the judge had ample opportunity to determine the boy's maturity and soundness of judgment as to his custody. Further, there was substantial testimony from the boy as well as other witnesses with respect to the friction that existed between the boy and his mother. The record also discloses that the older boy's school, friends, and interests differed from that of his sister and younger brother. The trial court's decision did not sever all family ties since, pursuant to the order, all three children are to have the benefit of being with each other at certain times of the year and liberal visitation rights are provided.
Plaintiff's second contention is that the trial court erred in refusing to award her any child support, contending defendant is legally responsible for their support and is able to provide for them.
Although § 452.340, RSMo Supp.1973, which requires both parents' financial resources to be considered, was not yet in effect at the time of the decree in question (see § 452.415, supra), in a situation where the financial assets and income of both parents is well balanced, ordering one parent to pay child support to another may be unreasonable and hence an abuse of discretion under former § 452.070, RSMo 1969. Williams v. Williams, 510 S.W.2d 452, 455[3] (Mo. banc 1974).
Furthermore, it is well established that in determining the amount of child support the trial court's determination will not be set aside unless there appears a clear abuse of discretion. Fugate v. Fugate, 510 S.W.2d 705, 706[5, 6] (Mo.App.1974). Here, a substantial portion of the record dealt with the financial status of each parent. The trial judge questioned both parties with respect to their income, assets, and expenses. Plaintiff admitted to a total net worth of about $2,000,000.00 and an annual income of $75,000.00, and the defendant estimated his total assets were valued at approximately $125,000.00 with a $48,000.00 annual income. Defendant's expenses have also increased since a remarriage in which he contributes to the support of two stepchildren. We find no abuse of discretion by the trial judge for not awarding *427 child support to the plaintiff in this case.
The final point raised on appeal is that the court erred in terminating contractual obligations of the defendant with reference to medical and educational expenses of the children because defendant had not asked for such relief and such obligations were not subject to court modification. The original decree of divorce in 1969 provided for the incorporation in the decree of the contract made between the parties. Thus, the contract, which in part concerned these expenses, became merged in the decree and thereafter the contracted provisions were to be enforced as an order of the court, and could be reformed or amended only by modification of the decree. Toth v. Toth, 483 S.W.2d 417, 422[6-7] (Mo.App.1972). More specifically, we have held that "where the object of the contract, and hence of the decree in which it is merged, is to provide for the welfare of a child of the divorced parties * * * no contract of the parties will be binding and no decree of the court immutable, but the one may be disregarded and the other modified from time to time as the welfare of the child may require." Jenks v. Jenks, 385 S.W.2d 370, 377[10] (Mo.App.1964).
Plaintiff cites several cases suggesting the proposition that a husband and wife have the right to contract between themselves and to settle and adjust all of their property rights, and courts have no right to disregard them. See e. g., Goulding v. Goulding, 497 S.W.2d 842 (Mo.App.1973); Gunnerson v. Gunnerson, 379 S.W.2d 861 (Mo.App.1964); Jenkins v. Jenkins, 257 S.W.2d 250 (Mo.App.1953). These cases, however, are relevant only to alimony and support and maintenance of the wife. Defendant correctly points out that once the issue of the welfare of the child has been submitted to the court's jurisdiction, the court shall make all orders requisite to that welfare, including provisions for the monetary support of the child, giving due consideration to the circumstances of the parties. Allen v. Allen, 433 S.W.2d 580 (Mo.App.1968). The record indicates that the trial judge could have found that if the defendant were to continue to be obligated for the educational and medical expenses for the two younger children not in his custody, he might be forced to divert funds from the use of his older son in his custody.
The trial judge was involved with this case from 1972 until 1974, and the transcript is voluminous. There has been no abuse of discretion and we cannot say that the interests of the three minor children would be best served by a different disposition of their custody and a change in the support order.
The judgment is affirmed.
DOWD and RENDLEN, JJ., concur.
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128 Mich. App. 440 (1983)
340 N.W.2d 651
PEOPLE
v.
VESNAUGH
Docket No. 63052.
Michigan Court of Appeals.
Decided August 31, 1983.
Frank J. Kelley, Attorney General, Louis J. *442 Caruso, Solicitor General, William L. Cahalan, Prosecuting Attorney, Edward Reilly Wilson, Deputy Chief, Civil and Appeals, and Jeffrey Caminsky, Assistant Prosecuting Attorney, for the people.
Richard R. Nelson, for defendant.
Before: T.M. BURNS, P.J., and D.F. WALSH and C.W. SIMON, JR.,[*] JJ.
PER CURIAM.
Following a jury trial in the Detroit Recorder's Court, defendant was found to be guilty as charged of one count of second-degree criminal sexual conduct (CSC 2), MCL 750.520c(1)(a); MSA 28.788(3)(1)(a) (sexual contact with a person under 13 years of age), and was sentenced to a term of from 5 to 15 years imprisonment. Defendant now appeals as of right.
The complainant was a 12-year-old boy who had met defendant at a public swimming pool in 1980. He stated that defendant came to the pool most days.
The complainant testified that on June 11, 1981, defendant grabbed his genitals on two occasions. The first time defendant did not reach under the complainant's bathing suit, the second time he allegedly did. The complainant also alleged that defendant had grabbed his genitals on eight or nine other occasions.
On cross-examination, the complainant admitted that he had told Officer Karl Wenk only about the first grabbing incident on June 11. The complainant attributed this to nervousness when he was talking to the officer.
While the complainant stated that he had told *443 his mother about what happened at the pool on June 11, 1981, he admitted that he had never told his mother about any of the other alleged sexual contacts.
Three other boys testified that defendant had grabbed their genitals while they were at the pool. These incidents did not form the basis of any charge against the defendant but, rather, were introduced as similar-acts evidence.
The defense called no witnesses, and the defendant, against his counsel's advice, delivered his own closing argument. Defendant stated that playing keep-away in the water necessarily involved some body contact. Defendant also referred to the prosecution's obligation in a CSC 2 case to prove that any touching was intentional and for the purpose of sexual gratification.
Defendant first asserts that his conviction must be reversed because the prosecutor was permitted to ask the potential jurors whether the facts that defendant had once been a Catholic priest and was, at the time of trial, a member of the State Bar of Michigan would affect their ability to be imparital. Defense counsel objected to the question concerning his client's former status as a Catholic priest only after one potential juror indicated that she associated Catholic brothers with homosexuality and implied that her views were the same in respect to Catholic priests. Immediately after the prosecutor asked the potential jurors whether defendant's current status as a lawyer would affect their ability to fairly render a verdict, defense counsel replied, "I have a similar objection. I will articulate that at a later time if I may." Taken in context, it appears that defense counsel may well have been indicating that he had a question similar to the one the prosecutor had just posed which *444 he planned to ask the potential jurors. Although a serious question exists as to whether defendant's objection to the voir dire questions has been properly preserved for appellate review, we nonetheless choose to address this assignment of error on its merits.
The purpose of voir dire of prospective jurors is to afford counsel the opportunity to develop a rational basis for exercising both challenges for cause and peremptory challenges, and the scope of voir dire is entrusted to the discretion of the trial judge. People v Harrell, 398 Mich 384, 388; 247 NW2d 829 (1976); People v Prast (On Rehearing), 114 Mich App 469, 482; 319 NW2d 627 (1982).
Defendant cites People v Hall, 391 Mich 175; 215 NW2d 166 (1974), and People v Bouchee, 400 Mich 253; 253 NW2d 626 (1977), as support for his argument that it was improper to ask the jurors whether his status as a former priest would render them unable to fairly consider the evidence produced at trial. Both Hall and Bouchee reaffirm the Supreme Court's holding in People v Jenness, 5 Mich 305, 319 (1858), that it is improper to question witnesses about their opinions on religion. Here, however, no effort was made to attack the credibility of defendant based upon his religious beliefs. Rather, the prosecutor was simply desirous of determining whether any of the potential jurors would find it inconceivable that a former priest could have committed the charged offense. Instead of unfairly playing on religious prejudices, the prosecutor was trying to obtain a jury free from religious biases. In point of fact, two jurors were ultimately excused as a consequence of the question concerning defendant's status as a former priest. One potential juror admitted that she associated the priesthood with homosexuality; the *445 other admitted being deeply religious with great "respect for the ministry", and that it would be difficult for him to render a fair verdict. It would appear, then, that both the defense and prosecution were served by permitting the question concerning defendant's former status as a priest.[1]
Defendant cites no authorities to support his contention that it was improper to allow the jurors to be questioned about his status as an attorney. Moreover, defendant points to nothing in the record which even suggests that any juror was biased against him because he was an attorney. Thus, even if the question had been improper (which it was not), this would not be a basis for reversal. GCR 1963, 529.1.
Defendant next asserts that his conviction must be reversed because the prosecution did not produce various res gestae witnesses at the trial. However, as defendant never objected to the non-production of these witnesses or moved for a new trial or evidentiary hearing on this basis, this claim is not properly presented to this Court for review. People v Willie Pearson, 404 Mich 698, 722-723; 273 NW2d 856 (1979).
Defendant's final, and most troubling, assignment of error is that the trial court erred in allowing the introduction of similar-acts testimony which, if believed, showed that defendant had grabbed the genitals of others boys in the past. In People v Golochowicz, 413 Mich 298, 308-309; 319 NW2d 518 (1982), the Supreme Court explicitly *446 adopted the criteria propounded by this Court in People v Wilkins, 82 Mich App 260; 266 NW2d 781 (1978), rev'd on other grounds 408 Mich 69; 288 NW2d 583 (1980), for resolving issues concerning the admissibility of similar-acts evidence under MRE 404(b). These criteria are: (1) substantial evidence that defendant actually perpetrated the other act; (2) some special quality of the bad act tending to show one of the enumerated items specified in MRE 404(b); (3) the materiality of an item appearing in MRE 404(b) to defendant's guilt of the charged offense; and (4) a determination that the probative value of this evidence substantially outweighs the danger of unfair prejudice. 413 Mich 309. Defendant asserts that the similar-acts evidence offered in this case was not material to any genuinely controverted issue in the case and that the unfair prejudicial effects of this evidence vastly outweighed its probative value.
The trial court instructed the jury that it was only to consider the similar-acts evidence to aid it in determining whether defendant had acted "purposely" in touching the complainant, "that is, his acts were the result of a characteristic scheme or plan or system".
On appeal the prosecution argues that the similar-acts evidence was admissible to show that defendant had intentionally touched the complainant for the purpose of sexual gratification an element which must be proved to obtain a conviction under MCL 750.520a(g); MSA 28.788(1)(g). The prosecution has apparently abandoned the other basis upon which it argued for admissibility below, namely, to show "evidence probative of a design, scheme or plan". This decision is well founded.[2]
*447 In may respects, the scenario we are presented with is similar to the one posed in People v Major, 407 Mich 394; 285 NW2d 660 (1979), in which the Supreme Court reversed defendant's conviction, finding that similar-acts evidence had been improperly admitted at trial. In Major, defendant was charged with CSC 2; he had allegedly lifted the 11-year-old complainant's shirt and kissed her breast. Defendant denied that this act had occurred. The prosecution was permitted to introduce the testimony of two girls that defendant had exposed himself to each of them on a prior occasion. In addition, defendant had allegedly touched the chest of one of these girls. The Court of Appeals upheld defendant's conviction, justifying admission of the similar-acts evidence "to show motive and intent".
In Major, the Supreme Court reversed, holding that defendant's intent and motive were not genuinely in issue in that case. The Court specifically noted that defendant had not asserted that the kiss was unintentional or done for some innocent purpose. Moreover, the Supreme Court stated that, had the defendant asserted lack of intent or an innocent purpose in the kiss, the prior sexual acts may have been admissible.
In the instant case, in his opening argument, *448 defense counsel noted that the prosecution had to prove an intentional touching for the purpose of sexual gratification. Moreover, in his closing argument, defendant personally argued that playing keep-away in the water necessarily involved bodily contact with other participants. The existence of these arguments, unlike the scenario in Major, materially raised the question of whether defendant had committed an intentional touching for the purpose of sexual gratification. We further note the inherent improbability that the defendant in Major could have had any intention other than sexual gratification in raising the shirt of the 11-year-old complainant there and kissing her breast. In this case, to the contrary, without more, an incidental touching during the course of horseplay in a swimming pool was entirely plausible. Suffice it to say that on the facts of this case the defense had to do very little to raise a genuine question of whether there had been an intentional touching for the purpose of sexual gratification.
Defendant also assigns error to the fact that the trial court never found on the record that the probative value of the similar-acts evidence outweighed its prejudicial effect. The prosecution denies this contention, asserting that defendant has simply failed to provide this Court with the relevant transcript. We need not resolve this dispute because the Supreme Court has never required the trial courts to make this determination on the record, even though at least one panel of this Court has suggested that it should. People v Nabers, 103 Mich App 354, 366-367; 303 NW2d 205 (1981), rev'd in part on other grounds 411 Mich 1046; 309 NW2d 187 (1981). In our opinion the proffered similar-acts testimony was highly probative, *449 and we cannot say that the trial court erred in refusing to exclude it as unduly and unfairly prejudicial.
Affirmed.
NOTES
[*] Circuit judge, sitting on the Court of Appeals by assignment.
[1] Defendant also argues that his status as a former priest was irrelevant and that he would not have been allowed to give testimony about his religious beliefs. However, the fact that defendant could not give testimony about his religious beliefs certainly would not preclude defense counsel from bringing to the jury's attention that his client was at one time a priest. The prosecution had reason to be concerned about how the jury might react after learning this fact alone, wholly apart from defendant's professed religious beliefs.
[2] In People v Oliphant, 399 Mich 472; 250 NW2d 443 (1976), the Supreme Court made it clear that testimony concerning these other acts is not necessarily admissible to show scheme, plan, or system simply because the defendant had committed the same act in a similar manner on other occasions. Instead, proof of a scheme, plan, or system must be material to some issue in the case. The existence of a plan or scheme may not be shown through similar-acts evidence where the only tendency of this evidence is to support an inference that if defendant did it once, he probably did it again. In this case, "scheme" or "plan" as such was not material. Although the trial court stated that "scheme or plan or system" was a permissible purpose for which the jury could consider the similar-acts evidence, we need not reverse on this basis. In context, it is clear that the trial court instructed the jury that it could consider the similar-acts evidence only insofar as it tended to show that defendant had intentionally grabbed the complainant's genitals.
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TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-10-00191-CV
Gary Wayne Jaster, Appellant
v.
Comet II Construction, Inc.; Joe H. Schneider; Laura H. Schneider;
and Austin Design Group, Appellees
FROM THE DISTRICT COURT OF HAYS COUNTY, 274TH JUDICIAL DISTRICT
NO. 08-0847, HONORABLE WILLIAM HENRY, JUDGE PRESIDING
DISSENTING OPINION
The majority concludes that section 150.002 of the Texas Civil Practice and Remedies
Code does not require a certificate of merit from a party who files a third-party complaint or cross-
claim against a licensed or registered professional. Because I would instead hold that third-party
plaintiffs and cross-claimants must comply with section 150.002’s certificate-of-merit requirement,
I respectfully dissent.
As the majority correctly points out, section 150.002(a) expressly provides that “in
any action or arbitration proceeding for damages arising out of the provision of professional services
by a licensed or registered professional, the plaintiff shall be required to file with the complaint” a
certificate of merit. See former Tex. Civ. Prac. & Rem. Code Ann. § 150.002(a) (emphasis added).1
1
Like the majority opinion, any references to section 150.002 in this dissent will be to the
version of the statute that became effective in 2005 unless otherwise noted. See footnote 1 of the
majority opinion.
In Consolidated Reinforcement, L.P. v. Carothers Executive Homes, Ltd., we considered the type
of claims for which a certificate of merit is required under section 150.002(a). 271 S.W.3d 887, 894
(Tex. App.—Austin 2008, no pet.), overruled by S & P Consulting Eng’rs, PLLC v. Baker,
334 S.W.3d 390, 399-400 (Tex. App.—Austin 2011, no pet.). Interpreting the same version of
section 150.002 at issue in this case, we held that a certificate of merit was not required for non-
negligence causes of action. Id. at 891, 894; see also Natex Corp. v. Paris Indep. Sch. Dist., 326
S.W.3d 728, 733 (Tex. App.—Texarkana 2010, pet. dism’d w.o.j.); Landreth v. Las Brisas Council
of Co-Owners, Inc., 285 S.W.3d 492, 500 (Tex. App.—Corpus Christi 2009, no pet.); Kneiestedt v.
Southwest Sound & Elecs., Inc., 281 S.W.3d 452, 455 (Tex. App.—San Antonio 2007, no pet.);
Parker Cnty. Veterinary Clinic, Inc. v. GSBS Batenhorst, Inc., No. 02-08-380-CV, 2009 Tex. App.
LEXIS 8986, at *9-10 (Tex. App.—Fort Worth Nov. 19, 2009, no pet.) (mem. op); Gomez v. STFG,
Inc., No. 04-07-00223-CV, 2007 Tex. App. LEXIS 7860, at *6-7 (Tex. App.—San Antonio Oct. 3,
2007, no pet.) (mem. op). However, during the pendency of this appeal, this Court, sitting en banc,
reconsidered the issue and overruled this holding of Consolidated Reinforcement. See S & P
Consulting Eng’rs, PLLC v. Baker, 334 S.W.3d 390, 403-04 (Tex. App.—Austin 2011, no pet.).
In S & P Consulting Engineers, we held that a certificate of merit must be filed “in
any action for damages arising out of the provision of professional services by a design professional,”
including, but not limited to, cases alleging negligence. Id. at 403 (emphasis added). In that case,
the appellee homeowners had sued S & P Consulting Engineers (“S & P”) for potential costs and
losses associated with the fact that their subdivision properties were within a flood plain. Id. at 393.
The homeowners alleged that S & P was responsible for certification of the development plat for four
2
phases of development and that S & P’s representations in and regarding the plat constituted
violations of the deceptive trade practices act, statutory fraud, and common-law fraud. Id. at 393,
404. We concluded that these claims related to S & P’s performance of professional services, and
as a result, the homeowners were required to file a certificate of merit. Id. at 404.
In this case, Comet was sued by a homeowner, Dawoud, for violations of the deceptive
trade practices act, common-law fraud, breach of contract, negligence, and negligent misrepresentation.
Dawoud alleged that deficiencies in construction and design of his home resulted in “excessive
foundation settlement which in turn caused cracks and distortions.” In turn, Comet filed a third-party
complaint seeking contribution and indemnity from Jaster and ADG, alleging that “the [foundation]
plans were prepared by [Jaster], a professional engineer registered in the State of Texas” and that
Jaster and ADG “are or may be liable to [Comet] for all or part of the Plaintiff’s complaint.”
Similarly, after being added as a third-party defendant by Comet, ADG filed a cross-claim against
Jaster for contribution and indemnity alleging that “to the extent there is any defect in the foundation,
whether by design or construction, it is the fault of [Jaster] or [Comet].” After Jaster filed his motions
to dismiss, Comet amended its third-party complaint and added claims for violations of the deceptive
trade practices act, negligence, fraud, and breach of contract.
Under our holding in S & P Consulting Engineers, there can be no dispute that
Comet’s third-party claims and ADG’s cross-claim against Jaster are related to Jaster’s performance
of professional services. Upon filing, these claims became part of the lawsuit filed by Dawoud,
and accordingly, the claims became part of an “action . . . for damages arising out of the provision
of professional services by a licensed or registered professional.” See former Tex. Civ. Prac. &
3
Rem. Code Ann. § 150.002(a). Section 150.002 requires a “plaintiff” filing such claims to file a
certificate of merit with the complaint. See id.; S & P Consulting Eng’rs, 334 S.W.3d at 403. Thus,
the issue in this case becomes whether Comet and ADG are “plaintiffs” within the meaning of
section 150.002—a matter of statutory construction. See former Tex. Civ. Prac. & Rem. Code Ann.
§ 150.002(a) (requiring “plaintiff” to file certificate of merit “with the complaint”).
The majority concludes that the term “plaintiff” strictly refers to the party (or parties)
initiating the lawsuit and does not include third-party plaintiffs or cross-claimants. In other words,
the majority would hold that Jaster is stripped of the protections afforded by section 150.002 when
the claims against him, which otherwise fall within the scope of the statute, are brought by
parties other than the plaintiff who initiated the lawsuit. For the following reasons, I would instead
conclude that the term “plaintiff” includes any party that has asserted a claim for damages against
the professional arising out of his or her provision of professional services.
When construing a statute, our primary objective is to ascertain and give effect to
the legislature’s intent as expressed by the language of the statute. See City of Rockwall v. Hughes,
246 S.W.3d 621, 625 (Tex. 2008). We generally construe a statute’s words according to their plain
and common meaning. See National Liab. & Fire Ins. Co. v. Allen, 15 S.W.3d 525, 527 (Tex. 2000).
However, we must decline to adopt such a construction if it would lead to absurd results or if
a contrary intention is apparent from the context of the statute. See City of Rockwall, 246 S.W.3d
at 625-26.
The plain language of section 150.002 “reflects a legislative goal of requiring
merely that plaintiffs make a threshold showing that their claims have merit.” M-E Eng’rs, Inc. v.
4
City of Temple, 365 S.W.3d 497, 504 (Tex. App.—Austin 2012, pet. denied); see former Tex. Civ.
Prac. & Rem. Code Ann. § 150.002. The statute does not necessarily require a plaintiff to marshal
expert testimony that would be admissible at trial. M-E Eng’rs, 365 S.W.3d at 504. Rather, the
purpose of the certificate-of-merit requirement is to provide a method by which courts can
quickly dismiss meritless claims. See Criterium-Farrell Eng’rs v. Owens, 248 S.W.3d 395, 399
(Tex. App.—Beaumont 2008, no pet.) (“[T]he purpose of the certificate of merit is to provide a basis
for the trial court to conclude that the plaintiff’s claims have merit.”).
In the context of construction cases, like this one, engineers and other licensed
or registered professionals are routinely brought into the lawsuit as third-party defendants. This
affords the defendant/third-party plaintiff a method by which to shift liability.2 Under the majority’s
construction, the defendant/third-party plaintiff in such cases would not have to file a certificate of
merit, though the plaintiff asserting the very same claims would. This is an absurd result, and the
purpose of the plain language of the statute would be thwarted if third-party plaintiffs and cross-
claimants were not required to file certificates of merit in such cases. Conversely, a construction of
the term “plaintiff” that includes third-party plaintiffs and cross-claimants would require any party
asserting a claim within the scope of the statute to make a threshold showing of merit upon filing.
This construction is clearly consistent with the overall intent of the statute.
Further, as the majority points out, and I agree, third-party plaintiffs and cross-
claimants have some characteristics of plaintiffs. Most notably, when a party asserts a third-party
2
At the same time, the third-party defendant may offer testimony in his own defense that
supports the defendant/third-party plaintiff’s defense, in essence providing “free” expert testimony
in defense of the plaintiff’s claims.
5
claim or cross-claim, he or she asserts a claim for relief against another party, and those parties
become adverse. See Getty Oil Co. v. Insurance Co. of N. Am., 845 S.W.2d 794, 800 (Tex. 1992).
Thus, from the standpoint of the licensed or registered professional, third-party plaintiffs and cross-
claimants are certainly “plaintiffs” with regard to the third-party claims and cross-claims against
them. In conclusion, it is apparent from the context of section 150.002, that “plaintiff” must include
third-party plaintiffs and cross-claimants.
Finally, I would note that this construction of “plaintiff”—to include both third-
party plaintiffs and cross claimants—comports with our sister court’s well-reasoned holding in
CTL/Thompson Texas, LLC v. Morrison Homes, 337 S.W.3d 437 (Tex. App.—Fort Worth 2011,
pet. denied). In that case, Morrison Homes sued Sheffield Development Company (“Sheffield”)
for claims arising out of Sheffield’s sale of land to Morrison Homes. Id. at 439. Morrison Homes
also sued several professional defendants (collectively, “CTL”), who had provided geotechnical
engineering services for Sheffield, alleging negligence, professional negligence, and breach of
warranty, and filed a certificate of merit with its original petition. Id. at 439-40. Sheffield then filed
a cross-claim seeking contribution and indemnity from CTL, but did not file a certificate of merit.
Id. at 440, 444. The Fort Worth court affirmed the trial court’s denial of CTL’s motion to dismiss
Sheffield’s cross-claim, holding that Sheffield, a cross-claimant, was not required to file a certificate
of merit under section 150.002. Id. at 445-46. The court reasoned that “a cross-claiming defendant
may rely on the certificate of merit filed by the plaintiff and is not required to file a second,
independent certificate of merit.” Id. at 446. Conversely, the court pointed out, “when a defendant
files a third-party petition against a licensed or registered professional that the plaintiff has not
6
sued, then obviously the plaintiff has not filed a certificate of merit concerning the conduct of that
licensed or registered professional; consequently, the defendant acting as third-party plaintiff seeking
contribution and indemnity must do so.” Id. at 445-46. Implicit in the Fort Worth court’s reasoning
is that third-party plaintiffs and cross-claimants are subject to section 150.002’s certificate-of-merit
requirement, but may satisfy the requirement by relying on a certificate of merit previously filed by
another party. See id. I agree, and if any party had previously timely filed a certificate of merit in
this case, both Comet and ADG would have been entitled to rely on that certificate of merit in
connection with their claims.
I would conclude that both Comet and ADG are “plaintiffs” within the meaning of
section 150.002. See former Tex. Civ. Prac. & Rem. Code Ann. § 150.002. Further, under S & P
Consulting Engineers, the claims asserted by Comet and ADG are asserted in an “action for damages
arising out of the provision of professional services by a licensed or registered professional.” See
S & P Consulting Eng’rs, 334 S.W.3d at 404. Consequently, under S & P Consulting Engineers,
both Comet and ADG were each separately required to either (1) file a certificate of merit
contemporaneously with their complaint or (2) rely on a certificate of merit previously filed by
another party in the case. See former Tex. Civ. Prac. & Rem. Code Ann. § 150.002(a). However,
neither Comet nor ADG filed a certificate of merit in this case.3 Further, no other party in this case
3
While Comet subsequently filed a certificate of merit with its amended third-party complaint,
almost two months after filing its original third-party complaint, Comet does not contend that it
requested or obtained any extension of time under subsection (b) of section 150.002. See former
Tex. Civ. Prac. & Rem. Code Ann. § 150.002(b) (providing that “contemporaneous filing requirement”
does not apply when period of limitation will expire within ten days of date of filing and that court
may grant, upon motion, extension for filing of more than thirty days); see also Sharp Eng’g v. Luis,
321 S.W.3d 748, 752 (Tex. App.—Houston [14th Dist.] 2010, no pet.) (holding that trial court
abused its discretion in denying motion to dismiss where plaintiff failed to file certificate of merit
7
timely filed a certificate of merit upon which Comet or ADG could rely. See CTL/Thompson Tex.,
337 S.W.3d at 445-46. Accordingly, both ADG and Comet failed to comply with section 150.002’s
certificate-of-merit requirement.
Ordinarily, under these circumstances, I would conclude that the trial court abused
its discretion in denying Jaster’s motions to dismiss. Further, I would reverse the trial court’s order
and remand the cause for the trial court to dismiss the claims after determining whether each
dismissal is with or without prejudice. See former Tex. Civ. Prac. & Rem. Code Ann. § 150.002(d)
(providing that failure to file certificate of merit “shall result in dismissal of the complaint against
the defendant” and that “dismissal may be with prejudice”); Sharp Eng’g v. Luis, 321 S.W.3d 748, 752
(Tex. App.—Houston [14th Dist.] 2010, no pet.). However, like this Court did in S & P Consulting
Engineers, I would conclude that a different result is warranted in this case. See 334 S.W.3d at 404.
In S & P Consulting Engineers, this Court determined that the homeowners had failed
to file a certificate of merit as required by section 150.002. See id. However, rather than remand
the cause for the trial court to dismiss the homeowners’ claims, we recognized that “the parties and
the trial court were proceeding under the authority of [Consolidated Reinforcement]” and thus
“justice require[d] a different result.” Id. Therefore, instead of remanding the cause to the trial court
for dismissal, we adapted the statutory grace period designed for cases filed within ten days of the
limitations period and allowed the homeowners an additional thirty days to file a certificate of
merit. See id.; see also former Tex. Civ. Prac. & Rem. Code Ann. § 150.002(b) (providing that
“contemporaneous filing requirement” does not apply when limitations period will expire within
with first-filed complaint and did not contend that exception set forth in section 150.002(b) was
applicable).
8
ten days of date of filing and that court may grant, upon motion, extension for filing of more than
thirty days).
Similarly, in this case, the parties, in choosing not to file a certificate of merit, may
have relied upon Consolidated Reinforcement, our controlling precedent at the time. See S & P
Consulting Eng’rs, 334 S.W.3d at 392. The trial court, in denying the motions to dismiss, may have
also relied on that same authority.4 See id. Accordingly, I would conclude that “justice requires a
different result” in this case. See id.
I would reverse the trial court’s orders denying the motions to dismiss and remand
the cause to the trial court. I would also allow Comet and ADG thirty days from the date this
judgment is mandated to file a certificate of merit satisfying the requirements of section 150.002.
See Tex. R. App. P. 43.3; former Tex. Civ. Prac. & Rem. Code Ann. § 150.002(b) (in cases in which
original petition is filed within ten days of the expiration of the limitations period, plaintiffs may file
affidavit within thirty days of filing of petition).
4
As previously discussed, Consolidated Reinforcement and similar cases held that non-
negligence causes of action do not require a certificate of merit. See, e.g., Consolidated Reinforcement
v. Carothers Executive Homes, Ltd., 271 S.W.3d 887, 894 (Tex. App.—Austin 2008, no pet.),
overruled by S & P Consulting Eng’rs v. Baker, 334 S.W.3d 390, 399-400 (Tex. App.—Austin 2011,
no pet.). In addition, Consolidated Reinforcement and its associated cases are unclear and confusing
with regard to exactly what claims constitute a “non-negligence cause of action.” Compare Kneiestedt
v. Southwest Sound & Elecs., Inc., 281 S.W.3d 452, 455 (Tex. App.—San Antonio 2007, no pet.)
(“When the plaintiff does not claim a negligent act, error or omission exists, and is not required
to make such an allegation as an element of its cause of action, a certificate of merit is not
required under section 150.002(a).”) with Parker Cnty. Veterinary Clinic v. GSBS Batenhorst, Inc.,
No. 02-08-380-CV, 2009 Tex. App. LEXIS 8986, at *9-10 (Tex. App.—Fort Worth Nov. 19, 2009,
no pet.) (mem. op.) (considering “the source of the duty and nature of the remedy sought” in
determining whether breach of contract claim was negligence claim within the scope of section
150.002); see generally Ashkar Eng’g Corp. v. Gulf Chem. & Metallurgical Corp., No. 01-09-00855-
CV, 2010 Tex. App. LEXIS 769, at *11-28 (Tex. App.—Houston [1st Dist.] Feb. 4, 2010, no pet.)
(mem. op.) (summarizing different approaches taken by courts in determining which claims are
“negligence” claims under section 150.002).
9
__________________________________________
Diane M. Henson, Justice
Before Justices Henson, Rose and Goodwin
Filed: August 31, 2012
10
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481 N.W.2d 578 (1992)
In re the Marriage of Susan K. SHEERAN, Petitioner, Appellant,
v.
Thomas A. SHEERAN, Respondent.
No. C9-92-164.
Court of Appeals of Minnesota.
March 17, 1992.
*579 Rebecca L. Wessman, Mankato, for appellant.
Perry A. Berg, Patton, Hoversten & Berg, P.A., Waseca, for respondent.
Considered at Special Term and decided by WOZNIAK, C.J., and KALITOWSKI and SCHUMACHER, JJ.
SPECIAL TERM OPINION
WOZNIAK, Chief Judge.
FACTS
The parties' 1986 dissolution decree awarded custody of their three children to respondent Thomas A. Sheeran. In August 1991, appellant Susan K. Sheeran moved for modification of custody under Minn.Stat. § 518.18 (Supp.1991). After an evidentiary hearing, the trial court denied the motion by order dated December 27, 1991. The order also awarded respondent $1,000 in attorney fees.
In this appeal from the December 27, 1991 order, appellant challenges both the denial of her modification motion and the attorney fees award. The order denying modification is appealable. See Angelos v. Angelos, 367 N.W.2d 518, 520 (Minn.1985) (final orders denying or granting modification of custody, visitation, maintenance, or support are appealable as of right). This court questioned whether appeal of the attorney fees award must be taken from a judgment. Only appellant filed a jurisdiction memorandum.
DECISION
The trial court administrator is required to enter judgment "forthwith" upon an order for the recovery of money only "unless the court otherwise directs." Minn. R.Civ.P. 58.01. Here, the order awarding money to respondent for his attorney fees is an order upon which judgment must be entered, even though the trial court did not specifically direct entry of judgment. The proper appeal, therefore, is from the judgment. See Graupmann v. Rental Equip. & Sales Co., 425 N.W.2d 861, 862 (Minn. App.1988) (because Rule 58.01 mandates entry of judgment upon order denying all relief, appeal must be taken from a judgment, even though trial court did not direct entry of judgment).
Judgment was entered upon the order awarding attorney fees in this case on February 11, 1992. In the interests of judicial economy, we will extend review to the February 11, 1992 judgment and allow the entire appeal to proceed. Normally, however, an order for the recovery of money must be reduced to judgment prior to appeal. See Schaust v. Town Bd. of Hollywood Township, 295 Minn. 571, 572-73, 204 N.W.2d 646, 648 (1973) (appeal from judgment prior to entry is premature and must be dismissed).
Appeal to proceed.
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952 F.2d 1144
139 L.R.R.M. (BNA) 2256, 120 Lab.Cas. P 11,115
PACIFIC & ARCTIC RAILWAY AND NAVIGATION COMPANY, Plaintiff-Appellee,v.UNITED TRANSPORTATION UNION, Defendant-Appellant.
No. 90-35646.
United States Court of Appeals,Ninth Circuit.
Submitted Dec. 19, 1991.*Decided Dec. 30, 1991.
Richard K. Walker, Bruce L. Downey and Peter Kryn Dykema, Winston & Strawn, Washington, D.C., James T. Robinson, Gorsuch, Kirgis, Campbell, Walker & Grover, Denver, Colo., for plaintiff-appellee.
Eric R. Hoffman, Binn, Hochman & Melamed, Mayfield Heights, Ohio, A. Lee Petersen, Anchorage, Alaska, for defendant-appellant.
Appeal from the United States District Court for the District of Alaska.
Before WRIGHT, Senior Circuit Judge, SNEED and SCHROEDER, Circuit Judges.
SNEED, Circuit Judge:
1
This appeal concerns a labor dispute and arbitration that began nearly a decade ago when the railroad suspended its railway operation between Skagway, Alaska and Lake Bennett, Yukon Territory. Several grievances were heard by a three-member arbitration panel. The union prevailed on the grievances relevant here. The railroad sued to vacate the awards, alleging that the third member of the panel, the supposedly neutral arbitrator, was biased. The district court held for the railroad, finding a due process violation. This court remanded in an earlier appeal, 855 F.2d 862, directing the district court to address the statutory grounds for vacatur. The district court did so, and again vacated the award. Specifically, the district court found that the award was procured by fraud, that the award exceeded the arbitrator's jurisdiction, and that the arbitrator's bias violated due process. The union appeals these findings. We affirm, on the basis that the award was procured by fraud. We do not reach the other issues addressed by the district court.
I.
FACTS AND PROCEEDINGS BELOW
2
In the fall of 1982, after Pacific and Arctic Railway and Navigation Company suspended its rail operations, United Transportation Union filed several grievances for its members who were out of work. The grievances were submitted to a three-person arbitration board consisting of J.W. Mills from the railroad, Kenneth Levin from the union, and Arthur Sempliner, a supposedly neutral arbitrator. Unknown to the railroad, Levin and Sempliner had been friends for 20 years. Also unknown to the railroad, Levin telephoned Sempliner a number of times before the hearings. The calls followed by less than 24 hours a Canadian panel's issuance of decisions in a closely related case. Levin said the calls were to schedule the hearing, even though an earlier written agreement had already set the date.
3
The hearing took place on December 14 and 15, 1982, in Seattle, Washington. During the first day of the hearing, Mills asked Sempliner to dinner. Mills planned to ask Levin to join them if Sempliner accepted. Sempliner declined the invitation. He did not mention having made other plans with Levin.
4
After the close of proceedings on the first day, Levin and Sempliner spent ten to twenty minutes in Sempliner's hotel room. Railroad representatives unexpectedly crossed paths with them as they were leaving the room headed for dinner. The railroad's attorney, James Robinson, testified that he was "dumbfounded" to see them together. He directed Mills to join them, but Levin and Sempliner had left by a side door, and Mills was unable to locate them. Levin and Sempliner had dinner together. Levin paid for the dinner.
5
The next morning, Levin and Sempliner were seen together again at breakfast. When the hearing reconvened, the railroad objected to the ex parte contacts between Levin and Sempliner, and requested an explanation. Sempliner grew angry and hostile. A heated exchange developed between Sempliner and the railroad's attorney, Robinson. Sempliner repeatedly interrupted Robinson's statements. He characterized the railroad's allegations of impropriety as "drivel," and stated that the railroad had "no right to know" about Levin and Sempliner's activities together. Subsequently, Levin was sworn as a witness. He began to rebut the railroad's allegations. After further exchanges between Sempliner, the "neutral," and Robinson, Sempliner finally told Robinson, "[Y]ou can make no further record."1 At this point, the railroad withdrew from the hearing.
6
After a brief recess, Sempliner continued the proceedings with just the union present. The union presented its case through Levin. Levin introduced a number of exhibits into evidence. At one point, Levin began to introduce a document. Sempliner, no longer even in appearance "neutral," instructed the reporter to go off the record and then, believing himself to be off the record, advised Levin that the railroad could require any document introduced at the hearing to be produced in subsequent litigation. Sempliner then repeated his instruction to go off the record. When the record resumed, Levin introduced only a single page of the document. Toward the close of the hearing, Sempliner twice announced that the matter was heard and submitted, only to reopen the record for additional statements from Levin and himself.
7
Sempliner ruled in favor of the union. This ruling included an interpretation of a certain disputed clause in the collective bargaining agreement. The railroad asserted that this clause was operative only in case of a permanent shutdown of operations, while the union asserted that either a permanent or a temporary shutdown would trigger the clause. Sempliner accepted the railroad's reading of the clause, but ruled that the railroad had failed to prove its 1982 shutdown was not permanent. Thus, he found that the clause was operative and worked to the benefit of the union. This ruling was made despite the fact that both the railroad and the union agreed the suspension of operations was intended to be temporary, and an explicit disclaimer by the union that the shutdown was permanent. Early in 1983, the railroad sued to vacate Sempliner's awards.
8
The public law board held a second hearing in Skagway in the fall of 1983 to deal with another grievance. The railroad took the position that it had withdrawn from the public law board, and refused to participate in the hearing. Before the hearing, Levin telephoned Sempliner several times. Although the two arrived together in Skagway, Levin testified they had met accidentally at the airport in Juneau. The hearing lasted perhaps an hour, and no record was kept. Levin and Sempliner remained in Skagway for several days thereafter, during which time they went on fishing trips and took meals together. Sempliner again ruled for the union.
9
As stated above, this is the second time this case has been before us. This time the union appeals the district court's findings that Sempliner's actions were the functional equivalent of fraud, that his award exceeded the board's jurisdiction, and that his bias violated due process. We have jurisdiction under 28 U.S.C. § 1291.
II.
STANDARDS OF REVIEW
10
Review of an arbitration award under the RLA is " 'among the narrowest known to the law.' " International Ass'n of Machinists & Aerospace Workers v. Southern Pac. Transp., 626 F.2d 715, 717 (9th Cir.1980) (quoting Diamond v. Terminal Ry. Ala. State Docks, 421 F.2d 228, 233 (5th Cir.1970)). Judicial review of such awards is limited to whether (1) the board failed to comply with the Act, (2) the board failed to confine itself to matters within its jurisdiction, and (3) the board or parties used fraud or corruption to obtain the award. Union Pac. R.R. v. Sheehan, 439 U.S. 89, 93, 99 S.Ct. 399, 401, 58 L.Ed.2d 354 (1978); 45 U.S.C. § 153 First (q). The standard of review we employ is whether the award was obtained by fraud.
11
We review de novo whether the district court applied the correct test for fraud. See Toyota of Berkeley v. Automobile Salesmen's Union, 834 F.2d 751, 755 (9th Cir.1987), cert. denied, 486 U.S. 1043, 108 S.Ct. 2036, 100 L.Ed.2d 620 (1988). Factual findings on fraud claims are reviewed for clear error. Northwest Acceptance Corp. v. Lynnwood Equip., 841 F.2d 918, 922 (9th Cir.1988); Arrington v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 651 F.2d 615, 619 (9th Cir.1981).
III.
ANALYSIS
A. Definition of Fraud
12
The RLA does not define fraud. Nor have the courts determined what constitutes fraud under § 153 First (q). At common law, fraud was established if the plaintiff proved that "the defendant made false representations of material fact, intended to induce plaintiff to act, the representations were made with knowledge of, or reckless disregard for, their falsity, and the plaintiff justifiably relied upon those false representations to [its] detriment." Bulgo v. Munoz, 853 F.2d 710, 716 (9th Cir.1988). In reviewing for fraud under § 153 First (q), one court listed bribery as an example of the kind of fraud that this provision was aimed at preventing. Pitts v. National R.R. Passenger Corp., 603 F.Supp. 1509, 1517 (N.D.Ill.1985).
13
Both the Federal Arbitration Act, 9 U.S.C. § 10(a), and Federal Rule of Civil Procedure 60(b)(3) require that fraud be proven by clear and convincing evidence, not be discoverable by due diligence before or during the proceeding, and be materially related to the submitted issue. LaFarge Conseil et Etudes, S.A. v. Kaiser Cement & Gypsum Corp., 791 F.2d 1334, 1339 (9th Cir.1986); Bonar v. Dean Witter Reynolds, Inc., 835 F.2d 1378, 1383 (11th Cir.1988); see also Dogherra v. Safeway Stores, Inc., 679 F.2d 1293, 1297 (9th Cir.) (obtaining an award through perjury is fraud), cert. denied, 459 U.S. 990, 103 S.Ct. 346, 74 L.Ed.2d 386 (1982). An appearance of impropriety is not sufficient to establish bias under the Arbitration Act. Toyota of Berkeley, 834 F.2d at 755.
14
The union argues that because of the strong federal policy favoring arbitration, fraud under § 153 First (q) should require "an extremely high degree of improper conduct," such as dishonesty. We agree and adopt as the test for fraud the common law definition as modified by the Arbitration Act. That Act modifies the common law by requiring a greater level of improper conduct. We believe this is required because of the limited power of review we have over arbitration awards under the RLA.
15
Fraud properly embraces a situation in which the supposedly neutral arbitrator exhibits a complete unwillingness to respond, and indifference, to any evidence or argument in support of one of the parties' positions. See Pitts, 603 F.Supp. at 1517 (where one party bribes the supposedly neutral arbitrator, "no matter what the other party argues he is doomed to lose because the case is not being decided on its merits."). As we discuss below, Sempliner's conduct easily fits within that definition.
B. Applying the Definition
16
The union insists that fraud is not a proper characterization. It justifies Sempliner and Levin's ex parte contacts by asserting that arbitration is an informal process in which strict courtroom rules do not apply. It contends that Sempliner's relationship with Levin was not improper and that there was no evidence that the two men discussed the matter they were arbitrating.
17
The union's position cannot be reconciled with the district court's findings of fact. In particular, the court initially found that "there can be considerable question[ ] as to whether Sempliner retained any degree of impartiality. He was actively taking the union's part and shaping the record in order to sustain any award he intended to make." On remand, the court further found that
18
[i]n light of the entire record, including the procedural improprieties; the egregious non-disclosures and unbelievable post facto explanations by Levin and Sempliner; Sempliner's assumption of an advocate's role and active assistance to the union in shaping the record so that it might support his awards; the numerous ex parte communications between Levin and Sempliner; Sempliner's acceptance of gratuities and other favors from Levin or union officials; the actual and demonstrated bias of Sempliner and the irrational awards that are the product [of] Sempliner's bias and favoritism, I conclude that the awards are tainted by the functional equivalent of fraud....
19
As one would expect, no direct proof exists that Levin talked to Sempliner about the merits of the case. Levin, however, did admit that he and Sempliner had talked about one of the union negotiators, whose post-bargaining report the union used as evidence to show that the agreement included lifetime employment. In addition, the district court did not believe Levin's explanations for the prehearing phone calls with Sempliner. Nor did it believe that Levin and Sempliner had been completely candid about their contacts and conversations. As an appellate court, we defer to such credibility judgments. Anderson v. Bessemer City, 470 U.S. 564, 575, 105 S.Ct. 1504, 1512, 84 L.Ed.2d 518 (1985). The court's rejection of Levin's testimony, especially when neither he nor Sempliner mentioned any of their connections or contacts until they were confronted by railroad representatives, was not clear error.
20
Even if Levin and Sempliner did not discuss the merits of the case, their ex parte contacts afforded Levin an opportunity to probe Sempliner's mood and general attitude and then to prejudice Sempliner. The court found that Sempliner revealed his prejudice when he interrupted Levin at the hearing and recommended that Levin offer only a part of a document into evidence. Although the union asserts that the railroad could have introduced the entire document had it remained at the hearing, and contends that the incident was immaterial because the rest of the document was irrelevant to the issues at hand, the district court could properly find that Sempliner's recommendation was driven by his concern about the document's impact should the award be challenged in court.
21
The district court rejected the union's argument that, inasmuch as arbitration is an informal process where ex parte contacts are common and acceptable, any "procedural improprieties" in the instant case were permissible. The court found that although arbitration is usually informal, the railroad and the union had a practice of conducting more formal hearings. It based this finding on testimony of another neutral arbitrator who had presided over previous railroad and union grievance hearings. Of course, the railroad's expectations do not fix the bounds of acceptable conduct for arbitrators. Nor do we decide how informal an arbitration proceeding properly may be. But the district court could properly find, as it did, that Levin and Sempliner's conduct went far beyond mere informality.
22
Moreover, the district court found that Sempliner totally disregarded the railroad's arguments in arriving at his decision. As pointed out above, such conduct is, as a matter of law, fraud. While the breakdown of the arbitration proceedings on the second day of the Seattle hearing could simply have been a product of heated tempers and the parties' conflicting expectations of proper conduct, the district court found otherwise. We cannot say its finding was clearly erroneous.
23
" 'Congress specifically intended in the RLA to keep railroad labor disputes out of the courts.' " Edelman v. Western Airlines, Inc., 892 F.2d 839, 843 (9th Cir.1989) (citation omitted). The RLA's statutory scheme facilitates labor arbitration awards by discouraging appeals. However, neither the law nor sound principles of labor arbitration require that fraud be insulated from judicial review. The case before us is one of the very rare cases in which judicial review is warranted. We hold that the conduct of Sempliner and Levin was fraud for purposes of RLA § 153 First (q).
IV.
CONCLUSION
24
The portion of the district court's order directing that the arbitration award be vacated due to fraud is affirmed. We do not reach the other issues addressed by the district court.
25
AFFIRMED.
*
The panel finds this case appropriate for submission without oral argument pursuant to Ninth Circuit Rule 34-4 and Fed.R.App.P. 34(a)
1
The exchange that included this statement proceeded as follows:
THE ARBITRATOR [SEMPLINER]: Sir, I don't care what your plans are. Now, will you stop interrupting the board? If you say you're through, you're through.
MR. ROBINSON: I'm making a record. Are you preventing me from making a record?
THE ARBITRATOR: No, you can make no further record.
MR. ROBINSON: I can make no further record?
THE ARBITRATOR: As far as I'm concerned, you've said everything you can say.
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167 B.R. 83 (1994)
In re Evelyn J. WOOD, Erik C. Moebius, Debtors.
Michael A. WASH, Plaintiff,
v.
Erik C. MOEBIUS, Defendant.
Bankruptcy No. 93-12067-FM. Adv. No. 93-1330-FM.
United States Bankruptcy Court, W.D. Texas, Austin Division.
April 8, 1994.
*84 Michael M. Probus, Jr., Law Offices of Michael A. Wash, Austin, TX, for plaintiff.
William W. Rittenhouse, Austin, TX, for defendant.
Harvey D. Caughey, Austin, TX, for Chapter 7 trustee.
MEMORANDUM OPINION PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT
FRANK R. MONROE, Bankruptcy Judge.
The Court held a hearing on Plaintiff's Motion for Summary Judgment on March 23, 1994. The Court has considered pleadings of the parties, the competent summary judgment evidence, the argument of counsel, and the legal authorities cited to the Court by the parties. Based thereon, the Court enters this Memorandum Opinion as a statement of those material facts which are not in genuine dispute and the conclusions of law upon which the Court's ruling is based.
Material Facts Not in Genuine Dispute
On June 28, 1993, there was filed in Civil Action No. SA-92-CA-0566 styled Abelia Garcia, et al. v. Michael A. Wash, et al., ("Prior Action") an Amended Judgment rendered by the Honorable Edward C. Prado, United States District Judge for the Western District of Texas, San Antonio Division which granted the Motion for Sanctions filed by Michael A. Wash, the Plaintiff herein, pursuant to Rule 11 of the Federal Rules of Civil Procedure and assessed against the Plaintiff's counsel therein, Erik C. Moebius, sanctions in the amount of $15,403.62. That Judgment amended the prior Judgment entered on May 24, 1993. The Amended Judgment was entered pursuant to the Memorandum and Recommendation of the Honorable Robert B. O'Connor, United States Magistrate, filed in such case on March 18, 1993 which was accepted by Judge Prado by Order Accepting Magistrate's Recommendations filed May 24, 1993.
The Memorandum and Recommendation of the United States Magistrate is 114 pages in length. It speaks not only to the Motion for Sanctions filed by Wash but also to Motions for Summary Judgment and Motions for Sanctions filed by all Defendants therein. It is an exhaustive and thorough report which recommends to the district judge many findings of fact and conclusions of law with regard to the matters which were actually tried before him pursuant to the Order dated November 18, 1992 entered by Judge Prado in such proceeding referring all pretrial matters to Judge O'Connor.
The Plaintiff relies upon those recommended findings which were accepted by Judge Prado to support his Motion for Summary Judgment here. The findings of fact most relevant to this case are the following:
1. that ". . . plaintiffs' counsel [Moebius] filed plaintiffs' federal civil rights claims against the private defendants [including Wash] without having first conducted a reasonable inquiry into the factual bases for those claims." See Exhibit P-1, pp. 84-85, attached to Plaintiff Michael A. Wash's Motion for Summary Judgment;
2. that ". . . plaintiffs' counsel filed plaintiffs' federal civil rights conspiracy claims against the private defendants with full knowledge of, or wanton and reckless disregard for, the absence of any facts to support same and for the purpose of harassing those defendants with having to defend themselves in yet another forum." See Exhibit P-1, p. 85, attached to Plaintiff Michael A. Wash's Motion for Summary Judgment;
3. that "plaintiffs' counsel filed plaintiffs' original, first amended, and second amended pleadings in this lawsuit without having first made a reasonable inquiry into the factual basis for plaintiffs' federal civil rights claims against the private defendants and for the purpose of harassing the private defendants and increasing those defendants' costs of litigation." See Exhibit *85 P-1, p. 85, attached to Plaintiff Michael A. Wash's Motion for Summary Judgment;
4. that the record in the case ". . . demonstrates an abuse of the legal process by plaintiffs' counsel in the filing of plaintiffs' federal civil rights claims against the private defendants." See Exhibit P-1, p. 85, attached to Plaintiff Michael A. Wash's Motion for Summary Judgment; and
5. that "plaintiffs' claims against the private defendants were, and are, (1) based neither upon existing law nor a good faith argument for the extension, modification or reversal of existing law, (2) based upon inadequate legal support, and (3) motivated by improper purpose." See Exhibit P-1, pp. 86-87, attached to Plaintiff Michael A. Wash's Motion for Summary Judgment.
Although not restated herein in full due to the length of the documents, this Court incorporates by reference herein all of the findings of fact proposed by Judge O'Connor in his Memorandum and Recommendation and accepted by Judge Prado insofar as they relate to Wash's Motion for Sanctions which was one of the pending motions determined thereby.
Issues
1. Applicability of collateral estoppel?
2. Do the subsidiary facts determined in the Prior Action compel a determination of nondischargeability of the Rule 11 sanctions awarded to the Plaintiff against the Defendant in the Prior Action under § 523(a)(6)?
3. Under § 523(a)(7)?
Conclusions of Law and Analysis
1. Collateral Estoppel. Clearly the doctrine of collateral estoppel may be applied in dischargeability actions. Matter of Shuler, 722 F.2d 1253 (5th Cir.1984), cert. denied, 469 U.S. 817 (1984). In order to determine whether to apply collateral estoppel in any particular case, the Bankruptcy Court must have before it sufficient portions of the prior record in order to be able to determine that the subsidiary facts were actually litigated and necessarily determined by the prior court. In re Nix, 92 B.R. 164 (Bankr. N.D.Tex.1988). "If the prior record sufficiently established the subsidiary facts on which the judgment was based, the court then independently determines whether these subsidiary facts establish the elements of nondischargeability as defined by federal bankruptcy law." Id.
In the present case, we have before us the very detailed and complete 114-page Memorandum and Recommendation of the United States Magistrate, the 17-page Order Accepting Magistrate's Recommendations of the District Judge, and the ultimate Amended Judgment. An examination of these documents clearly reveals very detailed subsidiary facts which were found by that Court, which support that Court's ultimate ruling in the Prior Action, and which were viewed by it as necessary to its ruling. These factual findings are in sufficient detail that this Court can determine whether they also establish the independent elements of nondischargeability under the § 523(a) causes of action which are at issue in this adversary proceeding.
Further, "Collateral estoppel may be applied to a trial court finding even while the judgment is pending on appeal." In re Nix, supra at p. 167, citing Southern Pacific Communications Co. v. American Telephone & Telegraph, 740 F.2d 1011 (D.C.Cir.1984). In this case, Moebius alleges that he effectively appealed Judge Prado's Amended Order. Plaintiff disputes that. Regardless, the existence of an appeal does not prevent the rendering of a decision in this matter.
2. Nondischargeability Under § 523(a)(6). In order to apply collateral estoppel in this case, the factual issues under § 523(a)(6) sought to be precluded must be identical to those determined in the prior action, they must have been actually litigated, and the determination of these issues must have been necessary to the resulting judgment. Shuler, supra at p. 1256, n. 2 [citing White v. World Finance of Meridian, Inc., 653 F.2d 147, 151 (5th Cir.1981)].
The issue in the Prior Action was whether Moebius violated Rule 11 of the Federal Rules of Civil Procedure which provides in relevant part as follows:
*86 "The signature of an attorney . . . constitutes a certificate by the signer that the signer has read the pleading . . .; that to the best of the signer's knowledge, information and belief formed after reasonable inquiry, it is well grounded in fact and is warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law, and that it is not interposed for any improper purpose, such as to harass . . .". Rule 11, F.R.C.P.
The District Court found among other things (1) that Moebius had filed his client's federal civil rights claims against Wash without having first conducted reasonable inquiry into the factual basis of those claims and with full knowledge of, or wanton and reckless disregard for, the absence of any facts to support the same and for the purpose of harassing those defendants with having to defend themselves in yet another forum, (2) that Moebius filed plaintiffs' original, first amended, and second amended pleadings in this lawsuit without having first made a reasonable inquiry into the factual basis for plaintiffs' federal civil rights claims against the private defendants and for the purpose of harassing the private defendants and increasing the defendants' costs of litigation, (3) that the record demonstrates an abuse of the legal process by plaintiffs' counsel in the filing of plaintiffs' federal civil rights claims against the private defendants, and (4) that the plaintiffs' claims which were brought by Moebius against Wash were based neither upon existing law nor a good faith argument for the extension, modification, or reversal of existing law, were based upon inadequate legal support, and were motivated by improper purpose.
Also contained as part of Judge O'Connor's recommended findings accepted by Judge Prado is the following:
"Seldom, if ever, before has this Court been witness to a civil lawsuit in which a party has asserted more unsubstantiated, scurrilous allegations of perfidy on the part of a group of defendants that has been presented by plaintiffs herein in their Second Amended Petition [sic]. The plaintiffs allege that the private defendants bribed and conspired with no less than two separate state district court Judges for the purpose of depriving the plaintiffs of fair judicial proceedings. Such allegations necessarily draw into question the integrity of the individual defendants, two of whom are licensed attorneys, the two state court judges with whom the private defendants allegedly conspired, and the judicial process itself. Yet, despite several efforts by this Court to prod the plaintiffs into providing, if not proper summary judgment evidence supporting their broad-ranging allegations of corrupt activities on the part of the defendants, then at least fact-specific allegations supporting same, plaintiffs have furnished this Court with not even a scintilla of evidence establishing that any of the private defendants ever bribed or conspired with either of the two state district Judges mentioned plaintiffs' Second Amended Petition [sic]. Innuendo is no substitute for fact; stridency no substitute for evidence. Inferences of a civil rights conspiracy can only be drawn from legally admissible evidence, of which the record in this case is totally devoid. The plaintiffs' counsel's actions in filing plaintiffs' Second Amended Petition [sic] in this lawsuit constituted an abuse of the legal process rarely approached in the annals of this Court."
See Memorandum and Recommendation of United States Magistrate, pp. 87-88.
After hearing the Plaintiffs objections to the United States Magistrate's Memorandum and Recommendation, Judge Prado overruled those objections and accepted the Recommendation.
So, the District Court in the Prior Action has found as a matter of fact that with regard to the Plaintiff Wash, the Defendant Moebius caused pleadings to be filed "for the purpose of harassing", "without having first conducted a reasonable inquiry into the factual basis of those claims", "with full knowledge of, or wanton and reckless disregard for, the absence of any facts to support the same", which conduct "demonstrates an abuse of legal process by" Moebius and that *87 all of such action was "motivated by improper purpose".
Were the foregoing subsidiary facts actually litigated? There can be no doubt about it. They clearly were litigated, without question.
Were they necessary to be determined for the decision to be rendered in the prior Federal Court matter? Absolutely. The foregoing quoted findings are virtually identical to the provisions of Rule 11 which one must prove in order to establish a violation of that rule.
So the question becomes whether the subsidiary facts found in the prior Federal Court action are identical to those in this action that are required to be proven in order to establish a violation of § 523(a)(6). The answer is an unqualified "yes, they are."
In the Fifth Circuit "willful" as used in § 523(a)(6) means "intentional" and the term "malicious" means "without just cause or excuse". Seven Elves, Inc. v. Eskenazi, 704 F.2d 241 (5th Cir.1983).
"Willful" as used in § 523(a)(6), means deliberate or intentional. "Malicious", as used, means in conscious disregard of one's duties, or without just cause or excuse, and does not require ill will or specific intent to do harm.
Norton v. Dean (In re Dean), 79 B.R. 659, 662 (Bankr.N.D.Tex.1987).
Do the findings of fact in the Prior Action establish that Moebius' action was intentional? Clearly they do. Moebius, as attorney for the plaintiff in the Prior Action, caused the filing of his client's alleged federal civil rights conspiracy claims as contained in the plaintiff's original, first amended, and second amended pleadings. Moebius' position that the Prior Action fails to establish that he intended to injure Wash is not responsive as the inquiry is not whether there was an "intention to injure" but instead whether the act taken which resulted in the injury was intentional. Here, without question, the Prior Action establishes that Moebius' actions which resulted in the injury to Wash were wilfully taken; that is, he intended to take the actions he took and those actions resulted in the complained of injury.
Was Moebius' conduct malicious? Neither ill will or specific intent to do harm is required for a finding of malicious to be mandated under § 523(a)(6). Here the Prior Action has determined that Moebius' action was taken "for the purpose of harassing" Wash among others, that his action was "motivated by an improper purpose", and that it amounted to "an abuse of the legal process". Clearly, those findings are equal to and support a determination in this matter that Moebius' conduct was "without just cause or excuse" or in "conscious disregard of his duties" as a practicing attorney under Rule 11.
The subsidiary facts upon which the Amended Judgment was entered in the Prior Action having been actually litigated, having been necessary to the determination of the resulting judgment therein, and being identical to the facts which Plaintiff herein must prove by a preponderance of the evidence, Defendant is collaterally estopped from relitigating them. Judgment is mandated for the Plaintiff determining that the Amended Judgment against Moebius in the amount of $15,403.62 entered in the Prior Action in favor of the Plaintiff is not dischargeable.
3. Dischargeability Under § 523(a)(7). To the extent that the Amended Judgment represents "a fine, penalty or forfeiture . . . payable to and for the benefit of governmental unit, and is not compensation for actual pecuniary loss, . . .", it is nondischargeable. 11 U.S.C. § 523(a)(7).
Clearly, the central purpose of Rule 11 is to deter frivolous lawsuits. Thomas v. Capital Security Services, Inc., 836 F.2d 866, 879 (5th Cir.1988) (en banc). "Sanctions also insure, to a large degree, that victims of frivolous lawsuits do not pay the expensive legal fees associated with defending such lawsuits . . ." Id. citing United Food & Commercial Workers v. Armour and Co., 106 F.R.D. 345, 349 (1985). "However, we would caution that `[w]hether sanctions are viewed as a form of cost-shifting, compensating opposing parties injured by vexatious or frivolous litigation forbidden by Rule 11, or as a form of punishment imposed on those who violate the Rule, the imposition of sanctions pursuant to Rule 11 is meant to deter attorneys from violating *88 the Rule.' Donaldson [v. Clark], 819 F.2d [1551] at 1556 [(11th Cir.1987)] (emphasis added)." Id. at 877.
This Court has found three different results by courts in applying § 523(a)(7) in cases such as this.
One bankruptcy court, in deciding that Rule 11 sanctions imposed upon a debtor in a Chapter 11 case for actions taken therein are not discharged in the Chapter 7 case to which the debtor converted, stated what seems to be a "per se" rule:
Can a Rule 9011 sanction be discharged? This court must answer that question with a resounding `NO'! To allow the offending party to discharge a Rule 9011 sanction would totally defeat, destroy, and emasculate its purpose.
In re McIntyre, 96 B.R. 70 (Bankr.S.D.Miss. 1989).
Other courts have determined that the "plain meaning" of § 523(a)(7) compels a ruling of nondischargeability only if the award is both payable to and for the benefit of a governmental unit. In re Strutz, 154 B.R. 508 (Bankr.N.D.Ind.1993). In re Ellwanger, 105 B.R. 551, 555-6 (9th Cir. BAP 1989) ("Congress specifically created an exception to discharge for noncompensatory damages. In establishing the exception Congress clearly determined not to allow nongovernmental entities to seek to have penalties and other noncompensatory determined nondischargeable."). Another bankruptcy court determined that costs awarded by the Idaho Supreme Court in favor of the Idaho State Bar in disciplinary proceedings against the debtor/lawyer were nondischargeable under § 523(a)(7) because the Idaho State Bar was a governmental unit. In re Williams, 158 B.R. 488 (Bankr.D.Idaho 1993). See also In re Corbly, 61 B.R. 851 (Bankr.D.S.D.1986), on reconsideration, 149 B.R. 125 (Bankr. D.S.D.1992) (Portion of contempt judgment payable to a municipality which was determined to be a fine payable to and for the benefit of a governmental unit was nondischargeable since it was noncompensatory in nature).
Still other courts have held similar judicial fines or penalties nondischargeable even though payable to a private litigant. In re Winn, 92 B.R. 938 (Bankr.M.D.Fla.1988) (A contempt judgment payable to the opposing party was determined not to be compensation for actual pecuniary loss, even though civil in nature, and to be for the purpose of vindicating the dignity and authority of the court and, therefore, for the benefit of a governmental unit.). In re Klein, 31 B.R. 947 (Bankr.Colo.1983) (Contempt fine for failure to deliver children in accordance with custody order was a penalty imposed to uphold the dignity of the court and was noncompensatory in nature; therefore, it was nondischargeable even though payable directly to the opposing party.) In re Marini, 28 B.R. 262 (Bankr.E.D.N.H.1983) (A fine for violation of a temporary restraining order construed to be primarily to uphold the dignity of the court even though payable directly to the opposing party and therefore nondischargeable.)
The language of § 523(a)(7) is clear and unambiguous. It holds a debt nondischargeable to the extent it is a "fine, penalty, . . . payable to and for the benefit of a governmental unit, and is not compensation for actual pecuniary loss, . . .". (emphasis added). The Supreme Court of the United States has told us bankruptcy judges simply to look at the "plain meaning" of the statute. United States v. Ron Pair Enterprises, Inc., 489 U.S. 235, 241, 109 S.Ct. 1026, 1030, 103 L.Ed.2d 290 (1989).
As a least one other bankruptcy court has put it,
This court must respectfully and reluctantly disagree. Although there are certainly excellent policy reasons for the `totality of the circumstances' inquiry adopted by Marini and its progeny, that type of analysis is demonstrably at odds with the plain meaning of the statute.
In re Strutz, supra at 510. The language of § 523(a)(7) is clear. In order to be nondischargeable the fine or penalty must be "payable to and for the benefit of a governmental unit". Further, it must not be compensatory in nature. In this case, the Rule 11 sanctions are not payable to a government unit but to a private litigant. Further, they are clearly compensatory in nature as they represent *89 attorney's fees incurred by Wash in the defense of the frivolous action brought by Moebius. The fact that one of the purposes for which the sanction was awarded was to uphold the dignity of the legal process in federal court as well as the court itself does not allow this Court to dispense with the other stated requirements of § 523(a)(7). Accordingly, the debt in question is dischargeable under § 523(a)(7).
An Order of even date with this Memorandum Opinion will be entered pursuant to Rule 59, F.R.C.P.
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Order issued August 10, 2016
In The
Court of Appeals
For The
First District of Texas
NO. 01-16-00599-CV
COLE DISTRIBUTION, INC. AND COLE CHEMICAL & DISTRIBUTING,
INC., Appellant
V.
VEXAPAK L.L.C., ANTONIO GONZALEZ CORTEZ AKA ANTONIO
GONZALEZ, JR. AKA ANTONIO D. GONZALEZ AKA ANTONIO D.
GONZALEZ CORTES AND ANTONIO GONZALEZ CARDENAS,
PRINCESS PROPERTIES LIMITED PARTNERSHIP, COLE
INTERNATIONAL, INC. AND DONNA F. COLE, Appellee
On Appeal from 125th District Court
Harris County, Texas
Trial Court Cause No. 2008-27646
MEMORANDUM ORDER
OF REFERRAL TO MEDIATION
The Court determines that it is appropriate to refer this appeal for resolution
by mediation. See TEX. CIV. PRAC. & REM. CODE ANN. §§ 154.021, 154.022(a),
154.023 (Vernon 2005). Accordingly, the Court orders that this appeal be referred
to mediation unless any party to the appeal files an objection with the Clerk of this
Court within ten days after receiving this order. See id. § 154.022(b).
The parties shall choose a qualified mediator and agree on a reasonable fee
for the mediator’s services. 1 See id. §§ 154.052, 154.054(a) (Vernon 2005).
The Court sets the following deadlines:
• No later than 15 days from the date that this order is issued, the
parties shall file with the Clerk of this Court a completed “Parties’
Notification to Court of Mediator.” This document can be
downloaded from the forms page of the Court’s website at
http://www.txcourts.gov/1stcoa.
• No later than 45 days from the date that this order is issued, the
parties shall conduct the mediation.
• No later than two days from the conclusion of the mediation,
the parties and the mediator shall advise the Clerk of this Court in
writing whether the parties did or did not settle the underlying dispute.
11
The Court does not recommend mediators. Mediation information is
available from the Dispute Resolution Center of Harris County ((713) 755-
8274 and http://www.co.harris.tx.us/DRC), the Fort Bend Dispute
Resolution Center ((281) 342-5000), the Alternate Dispute Resolution
Section of the State Bar of Texas (http://www.texasadr.org/), and other
groups. The parties are not required to use a mediator recommended or
listed by these groups.
All parties, or their representative with full settlement authority, shall attend
the mediation with their counsel. The mediator shall encourage and assist the
parties in reaching a settlement of their dispute, but may not compel or coerce the
parties to enter into a settlement agreement. See id. § 154.053(a) (Vernon 2005).
All communications relating to the mediation are confidential and not subject to
disclosure, except as set forth by law. See id. § 154.073 (Vernon 2005). The Clerk
of this Court, however, will file this order, any objection to this order, and the
completed “Parties’ Notification to Court of Mediator” with the other documents
filed in this appeal that are available for public inspection.
Unless expressly authorized by the disclosing party, the mediator may not
disclose to either party information given in confidence by the other and shall at all
times maintain confidentiality with respect to communications relating to the
subject matter of the dispute. See id. § 154.053(b). Unless the parties agree
otherwise, all matters, including the conduct and demeanor of the parties and their
counsel during the settlement process, are confidential and may never be disclosed
to anyone, including this Court. See id. § 154.053(c).
The Court will consider the agreed fee for the mediator’s services to be
reasonable and tax that fee as a cost of the appeal unless the parties agree to
another method of payment. See id. § 154.054.
/s/ Jane Bland
Justice Jane Bland
Acting Individually
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98 F.3d 1336
NOTICE: Fourth Circuit Local Rule 36(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 Fourth Circuit.UNITED STATES of America, Plaintiff--Appellee,v.Herbert J. ROTHBERG, Defendant--Appellant.
No. 96-6004.
United States Court of Appeals, Fourth Circuit.
Submitted Sept. 20, 1996Decided Oct. 3, 1996
Gregory B. English, ENGLISH & SMITH, Alexandria, Virginia, for Appellant.
Helen F. Fahey, United States Attorney, David G. Barger, Assistant United States Attorney, Alexandria, Virginia, for Appellee.
Before NIEMEYER, HAMILTON, and MOTZ, Circuit Judges.
PER CURIAM:
1
Herbert J. Rothberg seeks to appeal the district court's order denying relief on his 28 U.S.C. § 2255 (1994) motion. Specifically, Rothberg claims that the district court committed reversible error by dismissing the motion without the benefit of an evidentiary hearing. See Rules Governing § 2255 Proceedings, Rule 8. A district court need not conduct such a hearing where the facts are not in dispute. See, e.g., Foster v. Barbour, 613 F.2d 59, 60-61 (4th Cir.1980). Rothberg has not identified any factual dispute that could have been resolved at a hearing and our review of the record reveals none. The district court did not err in dismissing the motion without a hearing. Accordingly, we deny a certificate of appealability and dismiss the appeal. 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.
DISMISSED
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IN THE SUPREME COURT OF PENNSYLVANIA
MIDDLE DISTRICT
STATE FARM INSURANCE COMPANY, : No. 311 MAL 2019
:
Respondent :
: Petition for Allowance of Appeal
: from the Order of the Superior Court
v. :
:
:
DAWN MCATEER, :
:
Petitioner :
ORDER
PER CURIAM
AND NOW, this 10th day of December, 2019, the Petition for Allowance of Appeal
is DENIED.
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402 F.3d 416
In re: GENESIS HEALTH VENTURES, INC., DebtorGenesis Health Ventures, Inc.v.Kelly Beaudin Stapleton, Acting United States Trustee for Region 3In re: Multicare AMC, Inc., DebtorMulticare AMC, Inc.v.Kelly Beaudin Stapleton, Acting U.S. TrusteeJoseph J. McMahon, Jr., TrusteeGenesis Health Ventures, Inc., Multicare AMC Inc., AppellantsIn re: Genesis Health Ventures, Inc.; Multicare AMC, Inc., DebtorsReorganized Debtors Genesis Health Ventures Inc.v.Kelly Beaudin Stapleton, Acting U.S. TrusteeJoseph J. McMahon, Jr., TrusteeGenesis Health Ventures, Inc.; Multicare AMC Inc, Appellants.
No. 03-1225.
No. 03-2722.
United States Court of Appeals, Third Circuit.
Argued June 29, 2004.
Decided March 31, 2005.
Adam P. Strochak (Argued), Jeffrey L. Cimbalo, Weil, Gotshal & Manges LLP, Washington, DC, Michael F. Walsh, Gary T. Holtzer, Weil, Gotshal & Manges LLP, New York, NY, Mark D. Collins, Russell C. Silberglied, Richards, Layton & Finger, P.A., Wilmington, DE, for Appellants.
Frank J. Perch III, Assistant United States Trustee, Robert J. Schneider, Joseph J. McMahon, Jr., United States Department of Justice, Office of the United States Trustee, Wilmington, DE, Joseph A. Guzinski, General Counsel, Paul Wm. Bridenhagen, P. Matthew Sutko (Argued), United States Department of Justice, Executive Office for United States Trustees, Washington, DC, for Appellee.
Before: AMBRO, ALDISERT and STAPLETON, Circuit Judges.
OPINION OF THE COURT
AMBRO, Circuit Judge.
1
In this bankruptcy appeal, affiliated debtors (approximately 350 in number) filed separate cases under Chapter 11 of the Bankruptcy Code but were permitted to administer their cases jointly. The Bankruptcy Court also permitted them to use a "centralized cash management system" under which a small number of debtors held bank accounts from which the expenses of all other debtors were paid.
2
In this context, two issues are before us. The first is whether the employment of the centralized cash management system affects the amount of quarterly bankruptcy fees each debtor would otherwise owe to the United States Trustee under 28 U.S.C. § 1930(a)(6) in the absence of such a system. This issue, a question of first impression for us, turns on the interpretation of the term "disbursement" under § 1930(a)(6). Specifically, we consider whether payments made by certain debtors on behalf of other debtors constitute disbursements of the paying debtors only or whether those payments must be attributed to the debtors on whose behalf the payments were made. The second issue relates to the duration of payments. Does the obligation for U.S. Trustee quarterly fee payments under § 1930(a)(6) continue after confirmation of the debtors' Joint Plan of Reorganization ("Reorganization Plan" or "Plan") providing in part that they are "deemed consolidated" for certain purposes?
3
The Bankruptcy Court held, and the District Court affirmed, that (1) each debtor was obligated to pay quarterly fees based on the payment of its respective operating expenses regardless whether it actually wrote the checks to pay for these expenses, and (2) the deemed consolidation of the debtors under the Reorganization Plan had no effect on the amount of the quarterly fees payable by each debtor in connection with its own Chapter 11 case still pending. We agree with both Courts on both issues and thus affirm.
I. Factual and Procedural Background
4
Genesis Health Ventures, Inc. ("Genesis"), Genesis ElderCare Corp. (known for our purposes as "Multicare"), and their affiliates are providers of healthcare and support services to the elderly. On June 22, 2000, Genesis, Multicare, and their affiliates (collectively the "Debtors" and individually a "Debtor") separately filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware. The Debtors simultaneously moved for joint administration of their Chapter 11 cases in two groups — (1) Genesis and its affiliated debtors (the "Genesis Debtors"), and (2) Multicare and its affiliated debtors (the "Multicare Debtors").1 The Bankruptcy Court granted the Debtors' motions.
5
Because the Debtors planned to continue to operate their businesses as debtors in possession,2 they also moved for authorization to continue their centralized cash management systems in Chapter 11 — one for the Genesis Debtors, the other for the Multicare Debtors. Under the cash management system each Debtor's revenues were typically deposited into separate accounts. On a periodic basis, the funds in these separate accounts were transferred to a handful of "concentration accounts," then to several "disbursing accounts" held only by Paying Debtors. In turn, these disbursing accounts were used to pay the various financial obligations of each Debtor, such as accounts payable, payroll, and taxes. The Debtors maintained, however, inter-company balances so that each of them was able to account for its own revenues and expenses. On June 26, 2000, the Bankruptcy Court granted the Debtors' motions. In doing so, the Court directed each group of Debtors to "maintain records of all transfers within the cash management system so that all post-petition transfers and transactions shall be adequately and promptly documented in, and readily ascertainable from, their books and records, to the same extent maintained by the Debtors prior to the commencement of these [C]hapter 11 cases."
6
While operating under Chapter 11, the Debtors were required to pay quarterly fees to the U.S. Trustee under § 1930(a)(6).3 The amount of the quarterly fees payable under § 1930(a)(6) varies depending on the total "disbursements" that a debtor makes during each quarter. The maximum fee that a debtor is required to pay each quarter is capped at $10,000 for disbursements totaling $5 million or more. Id.
7
In little more than a year from the Debtors' Chapter 11 filings until June 30, 2001, they collectively paid $691,250 in quarterly disbursement fees. In calculating these fees, the Debtors treated all disbursements as applicable only to those Paying Debtors who held the disbursing accounts from which they were made. Had fees been paid for the Debtors for whom the disbursements were made, the aggregate quarterly disbursement fees would have been, according to the U.S. Trustee, almost $4.4 million.
8
The U.S. Trustee objected to the Debtors' proposed Reorganization Plan, claiming that they still owed approximately $3.7 million in quarterly fees.4 Each Debtor, the U.S. Trustee reasoned, owed its respective quarterly fees based on the disbursements attributable to that Debtor, regardless who held the accounts from which actual disbursements were made. After confirming the Reorganization Plan and reserving decision on the proper amount of quarterly fees,5 the Bankruptcy Court agreed with the U.S. Trustee and ordered the Debtors to pay the deficiency claimed by the U.S. Trustee. The District Court affirmed that decision one year later.
9
For the first quarter after the Reorganization Plan was confirmed — the fourth quarter of 2001 — the Debtors made a single fee payment of $10,000 to the U.S. Trustee, the statutory maximum amount for a single case. The Debtors claimed that the payment of a single fee was justified under the provision of the Reorganization Plan (§ 5.1) that "[d]eemed" the Debtors consolidated "for Plan [p]urposes [o]nly."6
10
The U.S. Trustee disputed this, arguing that quarterly disbursement fees should be assessed for each Debtor for its own Chapter 11 case notwithstanding the deemed consolidation provision of the Plan. The Bankruptcy Court again agreed, In re Genesis Health Ventures, Inc., 280 B.R. 95 (Bankr.D.Del.2002), and on appeal the District Court again affirmed.
11
The Debtors appeal the rulings on both the pre-confirmation and post-confirmation fee issues.7
II. Discussion
A. Pre-Confirmation Fees
12
The Debtors argue that payments made by Paying Debtors should not be allocated to other Debtors for whom the payments were made for the purpose of the § 1930(a)(6) fees calculation. They assert that "disbursement" in that subsection means "actual payment by cash or check." By this logic, payments made on behalf of, but not directly by, Debtors are irrelevant in determining the disbursements of those non-paying entities.
13
When the meaning of a statute is plain, "the sole function of the courts is to enforce it according to its terms." Caminetti v. United States, 242 U.S. 470, 485, 37 S.Ct. 192, 61 L.Ed. 442 (1917). The language of a statute is plain when it "admits of no more than one meaning" and in such a case "the duty of interpretation does not arise and the rules which are to aid doubtful meanings need no discussion." Id.
14
Section 1930(a)(6) provides that "a quarterly fee shall be paid to the United States trustee ... in each case under chapter 11 of title 11 for each quarter ... until the case is converted or dismissed, whichever occurs first." 28 U.S.C. § 1930(a)(6) (emphasis added). It is clear from this language that each Debtor in its respective Chapter 11 case is required to pay its own quarterly fee.
15
As stated previously, the Bankruptcy Court permitted the Debtors to administer their cases jointly and to transfer funds among themselves, allowing the affiliated Debtors to manage centrally their cash flow. For us the practical question is whether the convenience of cash management procedures make "disbursements" under § 1930(a)(6) mean only the literal payments by a Debtor even when they are made for other Debtors. Put another way, is an amount owed by Debtor A, but paid by Debtor B, attributed as a disbursement for U.S. Trustee quarterly fees to A (which would pay absent the cash management order) or B (which did not owe the amount itself but as an operational convenience was making A's payment)?
16
"Disbursement" is not defined in the statute. Thus we interpret the word in accordance with its "ordinary, contemporary, common meaning." Perrin v. United States, 444 U.S. 37, 42, 100 S.Ct. 311, 62 L.Ed.2d 199 (1979) (citation omitted). "Disburse" is defined as "to expend" or "to pay out." Websters' Third New International Dictionary 644 (1976). Based on this ordinary meaning, the Ninth Circuit Court of Appeals held that indirect payment of a debtor's expenses — i.e., payments made by an unrelated third party to secured creditors of the debtor — are disbursements of the owing debtor and should be included in calculating its quarterly fees under § 1930(a)(6). St. Angelo v. Victoria Farms, Inc., 38 F.3d 1525, 1533-34 (9th Cir.1994).
17
Other courts concur. See In re Central Copters, Inc., 226 B.R. 447, 449-50 (Bankr.D.Mont.1998) (holding that the sale proceeds of the secured property, which were paid directly from the purchaser to a secured creditor, should be included in the debtor's disbursements for the purpose of the fee calculation under § 1930(a)(6)); In re Flatbush Assocs., 198 B.R. 75, 78 (Bankr.S.D.N.Y.1996) (concluding that the rents paid directly by a debtor's subtenants to an apartment cooperative, which satisfied the cooperative fees the debtor owed to the apartment cooperative, are the debtor's disbursements); In re Meyer, 187 B.R. 650, 653 (Bankr.W.D.Mo.1995) ("[D]isbursements subject to quarterly fees pursuant to 28 U.S.C. § 1930(a)(6) are unrelated to who makes the disbursement or to whom the disbursement is made.") (citations omitted); In re Hays Builders, Inc., 144 B.R. 778, 780 (Bankr.W.D.Tenn.1992) ("The ordinary, plain meaning of the statutory language requires that all disbursements, whether direct or through a third party, be included in the calculation of fees due the trustee under § 1930(a)(6).").
18
Here, because the Debtors continued their operations after the bankruptcy filings, they incurred various expenses. Ordinarily each Debtor would have paid its respective quarterly fee to the U.S. Trustee based on the amount of expenses it incurred and paid. The intervening cash management procedures do not change the fact that payments of expenses took place for the account of each Debtor even though those payments occurred indirectly. Indeed, when the Bankruptcy Court granted the Debtors' motions for the continued use of each Debtor group's centralized cash management system, it specifically directed the Debtors to maintain records of all inter-company transfers so that each Debtor could account for all receipts and payments on its behalf.
19
In this context, substance trumps form. Payments made on behalf of a debtor, whether made directly or indirectly through centralized disbursing accounts, constitute that particular debtor's disbursements for the purpose of quarterly fees calculations under § 1930(a)(6). Holding otherwise would allow hundreds of affiliated debtors in Chapter 11 cases to avoid paying fees by having one debtor (or a few debtors) control disbursing accounts. See In re Hays Builders, Inc., 144 B.R. at 780 ("[If] the debtor must physically draw the disbursement check in order for the disbursements to be subject to the quarterly fee, [it would] creat[e] an opportunity to avoid paying the fees by setting up third party disbursing arrangements...."). While the result increases severalfold the quarterly fees the Debtors owe, any remedy is for Congress to fashion and not our Court.
B. Post-Confirmation Fees8
20
The U.S. Trustee's Manual provides that "[s]ubstantively consolidated cases become one case and are subject to only one [§ 1930(a)(6)] fee from the time the substantive consolidation order is docketed." U.S. Trustee Manual, Vol. III at § 3-8.3.3 (Oct.1998). Debtors argue that their deemed consolidation for Reorganization Plan purposes "bears all [the] indicia... of a substantive consolidation," making their post-confirmation trustee fee obligations that of but one entity.9 Even assuming substantive consolidation permits payment of a single fee, here the reorganized Debtors were not substantively consolidated.
21
Substantive consolidation treats separate legal entities as if they were merged into a single survivor left with all the cumulative assets and liabilities (save for inter-entity liabilities, which are erased). The result is that claims of creditors against separate debtors morph to claims against the consolidated survivor. Because its effect radically rearranges legal boundaries, assets and liabilities, substantive consolidation is typically a sparingly used remedy for debtors' conduct that blurs separateness so significantly that either the debtors' assets are so scrambled that unscrambling them is cost, time and energy prohibitive or creditors already perceive the debtors as simply a single unit and deal with them so. Yet again form follows substance.
22
Contrast these cases. Debtors' prepetition actions leave no impression of blurring entity separateness. Moreover, § 5.1 of the Plan explicitly does not "affect ... the legal and organizational structure of the Reorganized Debtors" and no one sought substantive consolidation-creditor or debtor. (Indeed, for the most part Debtors are obligated for licensing purposes to maintain separate corporate identities.) But for possibly the merger contemplated by the Plan (the corporate parents of Genesis and Multicare), separate cases filed by the Debtors on the petition date remained the same separate cases after Plan confirmation.
23
All we have is a "[d]eemed [c]onsolidation ... for Plan [p]urposes." For a temporary period, claims against separate Debtors were "deemed filed against the deemed consolidated ... Debtors" and the handling of inter-Debtor claims and cross-Debtor guaranties was simplified. Put colloquially, per the Plan voting and distribution were streamlined. But for "funding distributions under the Plan," deemed consolidation left no effect on the Debtors (including their legal and organizational structures) and the rights of claimholders (including the holders of intercompany claims).
24
The Debtors made clear before the Bankruptcy and District Courts, and reiterate here, that § 5.1 of the Plan does not result in substantive consolidation.10 They claim instead that because the Bankruptcy Court examined and found justifications for substantive consolidation at the time of Plan confirmation,11 the resulting deemed consolidation must be a "[t]ype" of substantive consolidation. But factors favoring substantive consolidation, if indeed they existed, are at best inchoate ingredients for a result never made formal. Instead, the Debtors proposed a Reorganization Plan several zip (if not area) codes away from anything resembling substantive consolidation. That Plan, a contract Debtors proposed, now binds them. They got the benefit of the voting and distribution streamlining the Plan's deemed consolidation allowed. But without the collapsing of all the Chapter 11 cases into a single case, the plain language of § 1930(a)(6) requires that each Debtor extant post-confirmation pay quarterly fees until its "case" status ceases.12
25
In sum, substantive consolidation was not sought by the Debtors (or anyone else) and in any event was not ordered by the Bankruptcy Court. Nor did the deemed consolidation provisions of the Reorganization Plan result in a de facto substantive consolidation. All pre-confirmation cases (save perhaps the merged parent entities) continued as separate cases post-confirmation. Thus no basis exists for the Debtors to claim that there nonetheless was an effective substantive consolidation for purposes of quarterly fee calculations under § 1930(a)(6). We hold that quarterly fees should be assessed for each Debtor in each case still extant post-confirmation, as the "deemed consolidation" provision of the Reorganization Plan does not affect that assessment.
26
* * * * * *
27
Accordingly, we affirm the District Court's orders upholding the decisions of the Bankruptcy Court.
Notes:
1
Although the Genesis Debtors and the Multicare Debtors are affiliated, they were grouped separately because of separate capital structures
2
Their businesses included over 300 nursing centers, 94 pharmacies, and 22 medical supply distribution centers
3
This provision provides:
In addition to the filing fee paid to the clerk, a quarterly fee shall be paid to the United States trustee, for deposit in the Treasury, in each case under chapter 11 of title 11 for each quarter (including any fraction thereof) until the case is converted or dismissed, whichever occurs first. The fee shall be $250 for each quarter in which disbursements total less than $15,000; $500 for each quarter in which disbursements total $15,000 or more but less than $75,000; $750 for each quarter in which disbursements total $75,000 or more but less than $150,000; $1,250 for each quarter in which disbursements total $150,000 or more but less than $225,000; $1,500 for each quarter in which disbursements total $225,000 or more but less than $300,000; $3,750 for each quarter in which disbursements total $300,000 or more but less than $1,000,000; $5,000 for each quarter in which disbursements total $1,000,000 or more but less than $2,000,000; $7,500 for each quarter in which disbursements total $2,000,000 or more but less than $3,000,000; $8,000 for each quarter in which disbursements total $3,000,000 or more but less than $5,000,000; $10,000 for each quarter in which disbursements total $5,000,000 or more. The fee shall be payable on the last day of the calendar month following the calendar quarter for which the fee is owed.
28 U.S.C. § 1930(a)(6).
4
The U.S. Trustee made its objection under 11 U.S.C. § 1129(a)(12), which provides that "[a]ll fees payable under section 1930 of title 28" must be paid prior to confirmation of a debtor's reorganization plan
5
The Court required the Debtors to escrow a sum sufficient to cover the fees claimed by the U.S. Trustee
6
Section 5.1 of the Reorganization Plan reads:
5
1. Deemed Consolidation of Debtors for Plan Purposes Only
(a) Subject to the occurrence of the Effective Date, the Genesis Debtors shall be deemed consolidated for the following purposes under the Plan of Reorganization: (i) no distributions shall be made under the Plan of Reorganization on account of the Genesis Intercompany claims; (ii) all guaranties by any of the Genesis Debtors of the obligations of any other Genesis Debtor arising prior to the Effective Date shall be deemed eliminated so that any Claim against any Genesis Debtor and any guaranty thereof executed by any other Genesis Debtor and any joint and several liability of any of the Genesis Debtors shall be deemed to be one obligation of the deemed consolidated Genesis Debtors; and (iii) each and every Claim filed or to be filed in the Reorganization Case of any of the Genesis Debtors shall be deemed filed against the deemed consolidated Genesis Debtors and shall be deemed one Claim against and obligation of the deemed consolidated Genesis Debtors.
Such deemed consolidation, however, shall not (other than for purposes related to funding distributions under the Plan of Reorganization and as set forth above in this Section) affect: (i) the legal and organizational structure of the Reorganized Debtors; (ii) intercompany Claims by and among the Genesis Debtors or Reorganized Debtors; (iii) pre- and post-Commencement Date guaranties, liens, and security interests that are required to be maintained (A) in connection with executory contracts or unexpired leases that were entered into during the Genesis Reorganization Cases or that have been or will be assumed, (B) pursuant to the Plan of Reorganization, or (C) in connection with any financing entered into, or New Senior Notes issued, by the Reorganized Debtors on the Effective Date; and (iv) distributions out of any insurance policies or proceeds of such policies.
Notwithstanding anything contained in the Plan to the contrary, the deemed consolidation of the Genesis Debtors shall not have any effect on the Claims being reinstated and unimpaired in Class G1 of the Plan, and the legal, equitable, and contractual rights to which the holders of any such Claims [are] entitled shall be left unaltered by the Plan.
Subsection "(b)," pertaining to the Multicare Debtors, essentially reads the same as "(a)."
7
The District Court had jurisdiction to review the Bankruptcy Court's orders granting the U.S. Trustee's motions pursuant to 28 U.S.C. § 158(a). We have appellate jurisdiction over the District Court's orders under 28 U.S.C. §§ 158(d) and 1291
An appeal from the District Court's review of the Bankruptcy Court's order is subject to plenary (also called de novo) review. In re O'Brien Envtl. Energy, Inc., 188 F.3d 116, 122 (3d Cir.1999). Moreover, when an appeal involves legal questions that turn on the interpretation of a statutory provision, we exercise plenary review of the Bankruptcy Court's legal determinations. Id.
8
The parties do not dispute that § 1930(a)(6), as amended in 1996, authorizes the U.S. Trustee to collect quarterly fees from a Chapter 11 debtor even after confirmation of its Reorganization Plan. By confirmation we mean, of course, its effective date and not when the order is docketed approving the Plan
9
As part of the Plan the Genesis and Multicare parent companies merged. Thus each group had the same corporate parent post-confirmation
10
The record shows that the Debtors not only failed to move to consolidate substantively their cases but also affirmatively denied that they were making such a proposal. For example, the Debtors' Chief Financial Officer testified during a hearing that the Debtors considered filing a motion for substantive consolidation, but decided not to request such relief because they expected it would disrupt their businesses. As the U.S. Trustee persuasively argues, the Debtors — sophisticated business entities — made a business decision not to pursue substantive consolidation to avoid that disruption
11
In its opinion approving the Reorganization Plan,In re Genesis Health Ventures, Inc., 266 B.R. 591 (Bankr.D.Del.2001), Bankruptcy Judge Wizmur did note various factors that, were substantive consolidation proposed, would have weighed in its favor. They included certain attributes of "substantial identity" among the Debtors, a central cash management system, and that eliminating inter-company claims for distribution purposes would aid certain creditors of Debtor-subsidiaries. Id. at 619. But, in considering the quarterly fee dispute that frames this appeal, Judge Wizmur clarified unequivocally that the continued existence post-confirmation of a Debtor continued that Debtor's § 1930(a)(6) obligations.
12
Debtor's argument that the U.S. Trustee's Manual requires a contrary result merits little comment for two reasons. The Manual, to reiterate, provides "substantially consolidated cases become one case" subject to but one post-confirmation quarterly fee. Substantive consolidation never occurred (as noted, it was never requested) in these cases and post-confirmation there was not in fact a single case
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FILED
NOT FOR PUBLICATION APR 16 2015
MOLLY C. DWYER, CLERK
UNITED STATES COURT OF APPEALS U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
ERIC CHARLES RODNEY K’NAPP, No. 14-16243
Plaintiff - Appellant, D.C. No. 1:12-cv-01895-LJO-MJS
v.
MEMORANDUM*
CALIFORNIA DEPARTMENT OF
CORRECTIONS & REHABILITATION;
et al.,
Defendants - Appellees.
Appeal from the United States District Court
for the Eastern District of California
Lawrence J. O’Neill, District Judge, Presiding
Submitted April 7, 2015**
Before: FISHER, TALLMAN, and NGUYEN, Circuit Judges.
California state prisoner Eric Charles Rodney K’napp appeals pro se from
the district court’s judgment dismissing his action alleging federal claims related to
the conditions of his confinement. We have jurisdiction under 28 U.S.C. § 1291.
*
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 an abuse of discretion a dismissal for failure to comply with an
order to file an amended complaint that comports with Federal Rule of Civil
Procedure 8. McHenry v. Renne, 84 F.3d 1172, 1177 (9th Cir. 1996). We affirm.
The district court did not abuse its discretion by dismissing K’napp’s action
because, after being warned of the possibility of dismissal, Knapp filed another
complaint that was not in compliance with the district court’s order and Rule 8.
See Ferdik v. Bonzelet, 963 F.2d 1258, 1262 (9th Cir. 1992) (setting forth factors
relevant to dismissal for failure to comply with a court order, and explaining that,
although dismissal is a harsh penalty, a district court’s dismissal should not be
disturbed unless there is a “definite and firm conviction that the court below
committed a clear error of judgment in the conclusion it reached upon a weighing
of the relevant factors” (citations and internal quotation marks omitted)); see also
McHenry, 84 F.3d at 1177 (Rule 8 requires that each averment of a pleading be
simple, concise, and direct, stating which defendant is liable to the plaintiff for
which wrong).
We reject K’napp’s contentions that he was not required to comply with the
magistrate judge’s orders, and that the district court judge and magistrate judge
demonstrated bias and failed to consider his pro se status.
We do not consider arguments and allegations raised for the first time on
2 14-16243
appeal. See Padgett v. Wright, 587 F.3d 983, 985 n.2 (9th Cir. 2009) (per curiam).
AFFIRMED.
3 14-16243
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947 F.2d 1486
Josephv.Whitley*
NO. 90-3518
United States Court of Appeals,Fifth Circuit.
OCT 21, 1991
1
Appeal From: E.D.La.
2
AFFIRMED IN PART.
*
Fed.R.App.P. 34(a); 5th Cir.R. 34.2
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Fourth Court of Appeals
San Antonio, Texas
MEMORANDUM OPINION
No. 04-15-00620-CR
Roy Lee WELCH,
Appellant
v.
The
The STATE of Texas,
Appellee
From the 187th Judicial District Court, Bexar County, Texas
Trial Court No. 2015CR9580
Honorable Steve Hilbig, Judge Presiding
PER CURIAM
Sitting: Rebeca C. Martinez, Justice
Patricia O. Alvarez, Justice
Luz Elena D. Chapa, Justice
Delivered and Filed: December 9, 2015
DISMISSED
On October 14, 2015, we notified the appellant that the trial court’s certification in this
appeal states that “this criminal case is a plea-bargain case, and the defendant has NO right of
appeal.” Additionally, the clerk’s record contains a written waiver signed by the appellant
pursuant to which he entered a plea of nolo contendere. The trial court’s judgment also reflects
that the punishment assessed did not exceed the punishment recommended by the prosecutor and
agreed to by the defendant. Therefore, the trial court’s certification accurately reflects that this
criminal case is a plea-bargain case. See TEX. R. APP. P. 25.2(a)(2).
04-15-00620-CR
In our October 14, 2015 order, we warned the appellant that “[this] appeal must be
dismissed if a certification that shows the defendant has the right of appeal has not been made part
of the record under these rules.” See id. R. 25.2(d). We ordered that this appeal would be
dismissed pursuant to Rule 25.2(d) unless the appellant caused an amended trial court certification
to be filed by November 13, 2015 that showed the appellant has the right of appeal. See id. R.
25.2(d), 37.1; see also Chavez v. State, 183 S.W.3d 675, 680 (Tex. Crim. App. 2006); Daniels v.
State, 110 S.W.3d 174, 176 (Tex. App.—San Antonio 2003, no pet.). No response was filed.
Accordingly, we dismiss this appeal.
PER CURIAM
Do not publish
-2-
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FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 08-10287
Plaintiff-Appellee,
v. D.C. No.
2:03-CR-00559-RCJ
ANDREW COLSON,
ORDER
Defendant-Appellant.
Appeal from the United States District Court
for the District of Nevada
Robert C. Jones, District Judge, Presiding
Submitted February 23, 2009*
Filed March 10, 2009
Before: Alex Kozinski, Chief Judge, Michael Daly Hawkins
and Ronald M. Gould, Circuit Judges.
COUNSEL
Franny A. Forsman, Federal Public Defender, Jason F. Carr,
Assistant Federal Public Defender, Las Vegas, Nevada, for
the appellant.
Gregory A. Browner, United States Attorney, Peter S. Levitt,
Assistant United States Attorney, Las Vegas, Nevada, for the
appellee.
*The panel unanimously finds this case suitable for decision without
oral argument. See Fed. R. App. P. 34(a)(2).
2987
2988 UNITED STATES v. COLSON
ORDER
Andrew Colson (“Colson”) appeals from the district court’s
decision regarding a discretionary reduction of sentence under
18 U.S.C. § 3582(c)(2). Colson acknowledges that the district
court’s decision is not reviewable under United States v.
Lowe, 136 F.3d 1231, 1233 (9th Cir. 1998), but argues that
Lowe is no longer good law in light of United States v. Carty,
520 F.3d 984 (9th Cir. 2008) (en banc).
We find no conflict between Carty and Lowe, and we
affirm that Lowe remains binding. Accordingly, the govern-
ment’s motion to dismiss for lack of jurisdiction is granted.
DISMISSED.
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The summary, which does not constitute a part of the opinion of the court, is copyrighted
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DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
RAYMOND GRIFFIN,
Appellant,
v.
STATE OF FLORIDA,
Appellee.
No. 4D18-517
[April 12, 2018]
Appeal of order denying rule 3.800 motion from the Circuit Court for
the Seventeenth Judicial Circuit, Broward County; Michael A. Usan,
Judge; L.T. Case Nos. 15006643CF10A, 15008046CF10A,
15009503CF10A, 15009797CF10A, 15010775CF10A, 15014065CF10A,
15014688CF10A, 15014860CF10A, 15014861CF10A and
16000411CF10A.
Raymond Griffin, Raiford, pro se.
No appearance required for appellee.
PER CURIAM.
Affirmed.
DAMOORGIAN, LEVINE and FORST, JJ., concur.
* * *
Not final until disposition of timely filed motion for rehearing.
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994 P.2d 476 (1999)
The PEOPLE of the State of Colorado,
In the Matter of the Petition of A.L.B., Petitioner,
For the Relinquishment of a Child,
B.L.B., and Concerning J.W.R., Respondent-Appellant, and
Adoptions: Advocacy & Alternatives, a Colorado non-profit corporation, and John and Mary Does, Intervenors-Appellees.
No. 98CA2418.
Colorado Court of Appeals, Div. II.
November 26, 1999.
*477 No Appearance for Petitioner.
Deborah L. Getz, Severance, Colorado, for Respondent-Appellant.
W. Troy Hause, Greeley, Colorado; Lamm, Freeman and Butler, Julia M. Knearl, Louisville, Colorado; Houtchens, Daniel & Greenfield, LLC, Dallas D. Greenfield, Greeley, Colorado, for Intervenors-Appellees.
Opinion by Judge RULAND.
J.W.R. (father) appeals from the judgment terminating the parent-child legal relationship with his son, B.L.B. We affirm.
Mother and father were not married. Prior to the child's birth, they decided that they were not ready to assume the responsibilities of parenthood. Accordingly, both parents requested adoption and relinquishment counseling from Adoptions: Advocacy & Alternatives (AAA), a licensed child placement agency. As part of the counseling, mother and father selected a couple (the Does) to adopt the child. Three weeks before the child was born, however, the paternal grandmother informed mother that she and her husband wanted to parent the child.
Following the child's birth, mother filed a petition in the Weld County district court for relinquishment together with a petition to terminate father's parental rights. The petition for relinquishment alleged that AAA had custody of the child. Shortly thereafter, John and Mary Doe, who had assumed physical custody of the child upon his release from the hospital, filed a petition for termination of father's parental rights in the Weld County proceeding.
During this same period, father initiated a child custody proceeding in Larimer County. *478 Venue of the Weld County case was later transferred to the Larimer County District Court. AAA then filed a petition to terminate father's parental rights in the Larimer County proceeding. The paternal and maternal grandmothers and the Does all filed motions to intervene.
The district court entered an order allowing the Does to intervene as a matter of right pursuant to § 19-5-105(3.6), C.R.S.1999. However, the court denied the grandmothers' motions. Following an evidentiary hearing, the trial court granted the petition to terminate, finding that the criteria for termination set forth in § 19-5-105, C.R.S.1999, had been established by clear and convincing evidence.
I.
Father contends that the order of termination must be reversed for a number of procedural reasons. First, he claims that mother's petition for termination filed in Weld County was defective. Second, he asserts that he did not receive notice of an emergency ex parte hearing held in Weld County. Finally, he claims that he was not properly notified of the termination proceeding in Larimer County. We are not persuaded by any of these contentions.
A.
Section 19-5-105(1), C.R.S.1999, provides that if one parent proposes to relinquish his or her parental rights, the agency or the person having custody of the child shall file a petition to terminate the other parent's rights.
Here, the record reveals that physical custody of the child was transferred from mother to the Does shortly after the child's birth. The record further indicates that AAA had legal custody of the child at all pertinent times. Hence, even though mother may not have had custody of the child at the time she filed her petition to terminate in Weld County, any defect in subject matter jurisdiction was cured by the filing of the subsequent petitions to terminate by the Does and AAA. See Stuart v. Frederick R. Ross Investment Co., 773 P.2d 1107 (Colo.App.1988).
B.
Section 19-1-113, C.R.S.1999, authorizes the issuance of ex parte emergency orders and delineates the procedure to be used in securing such orders. From the limited record before us, it appears that the statutory procedure was followed here. Accordingly, we perceive no error in the issuance of the ex parte emergency order.
C.
Finally, the record reveals that a copy of the petition to terminate filed in the Larimer County proceeding and notice of the termination hearing were properly served on father's attorney. There is no requirement in statutory or case law requiring service of notice on both counsel and a client. See People in Interest of J.E.B., 854 P.2d 1372 (Colo.App.1993). Thus, we find no error.
II.
Father next contends that the trial court erred in denying the paternal grandmother's motion to intervene. Because the denial of the motion to intervene impacts only grandmother's rights, see People in Interest of C.E., 923 P.2d 383 (Colo.App.1996), we conclude that father lacks standing to raise this issue on appeal. See Biel v. Alcott, 876 P.2d 60 (Colo.App.1993) (only parties adversely affected by a judgment may appeal it).
III.
Father contends that § 19-5-105, C.R.S.1999, violates his constitutional right to equal protection. He asserts that, unlike the dependency or neglect statute, § 19-3-604, C.R.S.1999, the relinquishment and adoption statute does not require either reasonable efforts and services to rehabilitate the parent or the consideration and elimination of less drastic alternatives to termination. We decline to address this contention as well.
Equal protection requires the government to treat similarly situated persons in a similar manner. Tassian v. People, 731 P.2d *479 672 (Colo.1987). However, in order to raise an equal protection challenge under the circumstances here, plaintiff must first demonstrate that he is personally affected by the alleged statutory defects. People in Interest of R.J.A., 994 P.2d 470 (Colo.App.1999); People in Interest of E.I.C., 958 P.2d 511 (Colo.App.1998).
In this case, the trial court found that father is an unfit parent at the present time and thus not able to take custody of the child. The court also found that father's problems arising out of his sexual abuse of his sister would require "long-term treatment and counseling."
Next, the court found that father's mother's home was not suitable as a placement resource because of various issues arising out of dysfunctional behavior within the family. Finally, the court found that it would be pure speculation to conclude and "grossly unlikely" that father would ever end up with custody of the child even with the institution of a dependency and neglect proceeding, adoption of a treatment plan and the resulting delay.
In sum, the court found that to institute a dependency and neglect proceeding would simply delay the inevitable to the substantial detriment of the child's best interests. Stated another way, the court in effect found that the dependency and neglect proceeding would result in termination of father's parental rights.
The credibility of the witnesses and the sufficiency of the evidence, its probative effect and weight, as well as the inferences and conclusions to be drawn therefrom, are within the discretion of the trial court. Thus, a trial court's findings and conclusions will not be disturbed on review if the record supports them. People in Interest of C.A.K., 652 P.2d 603 (Colo.1982). We conclude that the court's findings are supported by the record and thus we may not disturb them on appeal.
As a result, on this record father has failed to demonstrate the requisite standing to make an equal protection claim.
IV.
Father also contends that the evidence does not support an order of termination under § 19-5-105. Again, we disagree.
The criteria for termination of the parent-child legal relationship under § 19-5-105(3.1), C.R.S.1999, are:
[A] finding that termination is in the best interests of the child and that there is clear and convincing evidence of one or more of the following:
(a) That the parent is unfit....
(b) That the parent has not established a substantial, positive relationship with the child....
(c) That the parent has not promptly taken substantial parental responsibility for the child....
A.
Father asserts that the evidence was insufficient to show that he was unfit. We disagree.
Among the considerations in determining a parent's fitness in a relinquishment and adoption proceeding are conduct toward another child of a sexually abusive nature and neglect of the child. Section 19-5-105(3.1)(a)(I), (III), and (VI), C.R.S.1999.
Here, father admitted that he had sexually abused his sister and conceded that he could not assume physical custody of the child at the time of the termination hearing. Father's sexual abuse counselor testified further that sex offender treatment lasted a minimum of two and a half years and that the child should not be left alone with father.
Thus, the record supports the trial court's finding that father was unfit, and it will not be disturbed on review. See People in Interest of C.A.K., supra.
B.
Lastly, father asserts that termination was not in the child's best interests. We disagree.
In considering the child's best interests, the trial court must consider whether the child has developed a strong, positive bond with his physical custodian, the duration of the bond, and whether the child would likely *480 suffer significant psychological harm if removed from the home of the physical custodian. Section 19-5-105(3.2), C.R.S.1999.
Here, the child's guardian ad litem recommended that the child remain with the Does and opined that termination was in the child's best interests. This opinion was based in part on the guardian's determination that the four-month-old child was attaching to the Does, that the Does provided a suitable, safe home, that father was not likely to be available to the child in the near future, and that the paternal grandmother's home was not an appropriate placement option. Also, the child's mother testified that it was in the child's best interests to remain with the Does.
Thus, the evidence supports the trial court's finding that termination was in the child's best interests, and it will not be disturbed on review. See People in Interest of C.A.K., supra.
V.
Father contends that his due process right of confrontation was violated by the trial court's refusal to allow him to call the Does as witnesses. He argues that the ruling prevented him from presenting evidence of the child's bonding and best interests. Even if we assume that father had a right to call the Does, we find no reversible error.
A guardian ad litem is "a person appointed by a court to act in the best interests of a person whom the person appointed is representing in proceedings under [the Code]...." Section 19-1-103(59), C.R.S.1999. A guardian ad litem may make recommendations to the trial court by presenting his opinions based upon an independent investigation or by advocating a specific result based upon the evidence. People in Interest of J.E.B., supra.
Here, the child's guardian ad litem chose to present his opinions based upon an independent investigation. The trial court received the guardian's report into evidence without objection by father, and it took judicial notice of all of the reports filed in the proceeding. The reports filed by the guardian ad litem contained extensive information concerning the Does, their suitability as parents, and their relationship with the child, as well as general information concerning the child's best interests.
Furthermore, during the termination hearing, the trial court permitted father to call the guardian ad litem as a witness and to cross-examine him as to his reports and opinions. Next, father has failed to demonstrate how lack of direct testimony from the Does prejudiced his defense to termination of his parental rights. Hence, we find no error. C.A.R. 35(e).
VI.
Finally, father contends that wrongdoing on the part of AAA and its director requires reversal of the order of termination. However, that contention was not argued to the trial court at the conclusion of the evidentiary hearing. Hence, we decline to address it for the first time on appeal. See Matthews v. Tri-County Water Conservancy District, 200 Colo. 202, 613 P.2d 889 (1980).
We have considered and are unpersuaded by father's other contentions for reversal of the judgment.
The judgment is affirmed.
Judge CRISWELL and Judge MARQUEZ concur.
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Motion Denied and Order filed November 17, 2015.
In The
Fourteenth Court of Appeals
____________
NO. 14-15-00468-CR
NO. 14-15-00469-CR
____________
ROOSEVELT HART, Appellant
V.
THE STATE OF TEXAS, Appellee
On Appeal from the 185th District Court
Harris County, Texas
Trial Court Cause Nos. 1425126 and 1425127
ORDER
Appellant is represented by appointed counsel, Tonya Rolland. Appellant’s
brief was originally due August 5, 2015. We have granted a total of 90 days to file
appellant’s brief until November 4, 2015. When we granted the last extension, we
noted that no further extensions would be granted absent exceptional
circumstances. No brief was filed. On November 4, 2015, counsel filed a further
request for extension of time to file appellant’s brief. Counsel did not allege any
exceptional circumstances in the request.
We deny the request for extension and issue the following order.
Accordingly, we order Tonya Rolland to file a brief with the clerk of this
court on or before December 4, 2015. If counsel does not timely file appellant’s
brief as ordered, the court will issue an order abating the appeal and directing the
trial court to conduct a hearing to determine the reason for the failure to file the
brief and the consideration of sanctions, appointment of new counsel, or other
appropriate relief.
PER CURIAM
Panel consists of Justices Jamison, McCally and Wise.
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537 U.S. 1210
BECERRA-LOPEZv.UNITED STATES.
No. 02-8171.
Supreme Court of United States.
February 24, 2003.
1
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT.
2
C. A. 5th Cir. Certiorari denied. Reported below: 51 Fed. Appx. 482.
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985 F.2d 1451
Lee MORGAN, Petitioner,v.SECRETARY OF HOUSING AND URBAN DEVELOPMENT, Respondent.Frank Riciotti, III, Real Party in Interest.
No. 91-9554.
United States Court of Appeals,Tenth Circuit.
Feb. 18, 1993.
Edward Mulhall, Jr., Delaney & Balcomb, P.C., Glenwood Springs, CO, for petitioner.
Thomas E. Chandler, Attorney, (John R. Dunne, Asst. Atty. Gen., David O. Simon, Acting Deputy Asst. Atty. Gen., Jessica Dunsay Silver, Attorney, and Linda F. Thome, Attorney on the brief), Dept. of Justice, Washington, DC, for respondent.
Before KELLY and McWILLIAMS, Circuit Judges, and BROWN, District Judge.*
PAUL KELLY, Jr., Circuit Judge.
1
Petitioner Lee Morgan appeals from a decision of an administrative law judge (ALJ) finding that he engaged in a discriminatory housing practice based on familial status against complainant Frank Riciotti, III, contrary to 42 U.S.C. § 3604(a)-(d).1 The ALJ awarded Riciotti $14,297.99 in damages, imposed the maximum civil penalty of $10,000 and enjoined Morgan from discriminating against any persons with respect to housing because of familial status. See 42 U.S.C. § 3612(g)(3). The decision of the ALJ became final upon the expiration of thirty days without review by the Secretary. See 42 U.S.C. § 3612(h)(1). On appeal, Morgan challenges HUD's jurisdiction, the conciliation process, sufficiency of the evidence, and the award. Our jurisdiction arises under 28 U.S.C. § 2344 and 42 U.S.C. § 3612(i), and we affirm in part and reverse in part.
Background
2
Morgan owned a mobile home park and leased spaces to mobile home owners for $175 per month. The park rules, which were drafted by a tenants' committee before discrimination based on familial status was prohibited, barred new tenants with children from living in the park and required park management to approve new tenants.2 The Secretary alleged two separate incidents concerning the rental of lots and the sale of mobile homes in which Morgan withheld approving prospective tenants, relying on existing park rules.3
A. Sarno Home
3
In June 1989, tenants Michael and Rauna Sarno attempted to sell their home, priced at $29,500, to Debra and Frank Riciotti, III, who had a three-year old son. On June 2, the Riciottis offered the Sarnos $28,500. The Sarnos and the Riciottis attempted to persuade Morgan to waive the restriction on children. He refused. The Sarnos then received another offer from a couple with no children under eighteen. The offer was more than $28,500, but less than the $29,500 asking price. The Riciottis then made a second offer of $29,500, but on June 5, the Riciottis learned that the home was sold to the other couple for $29,500. The ALJ found that the unlawful "adults only" policy resulted in the sale of the Sarno home to the other couple rather than the Riciottis.
4
The next day, the Riciottis' attorney (Mrs. Riciotti's father) wrote Morgan a demand letter informing him that his refusal to consider the Riciottis' application for tenancy in the mobile home park violated the Fair Housing Act. Pet.Br.Add., doc. 5. The letter also indicated that unless Morgan reconsidered his decision, he would be sued. Upon receiving the letter, Morgan immediately contacted the Riciottis and advised them that he was retracting the policy. Morgan requested Riciotti withdraw his HUD complaint alleging discrimination based on familial status, and Riciotti agreed with the understanding that he would look for another home in the park. The Riciottis continued to look in the park during June, finding one home for sale that they did not like.
B. Krigbaum Home
5
A day or two after the July 4 holiday, the Riciottis made a $35,500 offer to purchase a larger home in the park owned by Marilyn Krigbaum, and the offer was accepted. Id. at 43. However, on July 10, when the Riciottis met with Morgan to go over the park rules and obtain approval, they noticed, but were not concerned, that the rules still contained the "adults only" policy. They also noticed that the amount of the rent was $225, not $175 as before. The Riciottis declined to purchase the home. A month later, the Krigbaum home was sold to another couple without children under eighteen. The new owners received a copy of the park rules with the "adults only" policy excised and paid the increased $225 rent required of all new tenants. The Riciottis purchased a townhome and reinstated their complaint with HUD.
6
The ALJ determined that Morgan had not denied the Riciottis the opportunity to purchase the Krigbaum home because the "adults only" rule was not applied to them. Recognizing the possible inferences from Morgan's failure to excise the offending rule and the subsequent rent increase, the ALJ declined to find that such acts were calculated to "otherwise make unavailable or deny" the Riciottis the Krigbaum home. See 42 U.S.C. § 3604(a). Rather, the ALJ determined that failure to excise the offending rule was inadvertent and the rent increase for new tenants was consistent with the rents charged by other parks, adopted prior to the Riciotti's second attempt to purchase a home in the park, and applied evenly to all new tenants. The Secretary has not appealed the ALJ's determination as to the Krigbaum home.
Discussion
7
I. Jurisdictional Defense--Tenth Amendment and Commerce Clause
8
Morgan first contends that HUD lacked subject matter jurisdiction over this case because of the absence of federal financing. All mobile homes were owned by the tenants and no evidence indicated that the Sarno or Krigbaum homes were financed with federal loans. Application of the Fair Housing Act after December 31, 1968, however, does not turn on the presence or absence of federal financing. See 42 U.S.C. § 3603(a).
9
Relying on the Tenth Amendment, Morgan next contends that the Secretary is exercising a power reserved to the States when he attempts to regulate mobile home space rentals. Recognizing that the Commerce Clause, U.S. Const. art. I, § 8, provided the federal jurisdictional base for the original Fair Housing Act, Morgan suggests that the amendments to the Act did not invoke the Commerce Clause and the Commerce Clause has never been exercised to prohibit discrimination based on familial status.
10
We reject this constitutional challenge to the Fair Housing Act amendments which pertain to familial status. The Eleventh Circuit has rejected virtually identical arguments. See Seniors Civil Liberties Assn. v. Kemp, 965 F.2d 1030, 1033-35 (11th Cir.1992) (per curiam). Morgan's challenge fails for several reasons. First, the familial status provisions regulate private citizens, rather than regulating the states as states; consequently, the Tenth Amendment does not apply. See Garcia v. San Antonio Metro. Transit Auth., 469 U.S. 528, 537, 105 S.Ct. 1005, 1010, 83 L.Ed.2d 1016 (1985); Hodel v. Virginia Surface Mining & Reclamation Ass'n, 452 U.S. 264, 286, 101 S.Ct. 2352, 2365, 69 L.Ed.2d 1 (1981). Second, the absence of formal findings concerning the effect on interstate commerce of discrimination based on familial status does not prevent Congress from regulating under the Commerce Clause. See Katzenbach v. McClung, 379 U.S. 294, 299, 85 S.Ct. 377, 381, 13 L.Ed.2d 290 (1964). Only a rational basis need support a finding that a regulated activity affects interstate commerce and the means selected by Congress need only be reasonably adapted toward the permissible end. Preseault v. ICC, 494 U.S. 1, 16-18, 110 S.Ct. 914, 924-25, 108 L.Ed.2d 1 (1990); McClung, 379 U.S. at 303-04, 85 S.Ct. at 383-84.
11
The legislative record, when viewed against a backdrop of the legislative history of the 1968 Fair Housing Act, provides a rational basis for finding that the sale and rental of residential housing, including mobile home lots, concerns more than one state and "has a real and substantial relation to the national interest." Heart of Atlanta Motel, Inc. v. United States, 379 U.S. 241, 255, 85 S.Ct. 348, 356, 13 L.Ed.2d 258 (1964). See Senior Civil Liberties Ass'n, 965 F.2d at 1034; Fair Housing Act of 1967: Hearings on S. 1358, S. 2114, and S. 2280 Before Subcomm. on Housing and Urban Affairs of the Senate Comm. on Banking and Currency, 90th Cong., 1st Sess. 6-14, 23-24 (1967). Housing discrimination based on familial status surely interferes with the efficient allocation of housing resources and could hinder interstate relocation. Congress could reasonably seek to remove such impediments by relying upon its commerce power to bar discrimination. See H.R.Rep. No. 711, 100th Cong., 2d Sess. 19, reprinted in 1988 U.S.C.C.A.N. 2173, 2180. See also Seniors Civil Liberties Assn v. Kemp, 761 F.Supp. 1528, 1545-46 (M.D.Fla.1991), aff'd, 965 F.2d 1030 (11th Cir.1992). Neither Congress nor the Secretary was required to show "that these mobile home space rentals in any way affect interstate commerce," see Pet.Br. at 8, because Congress may regulate an entire class of activities which affect interstate commerce, a case-by-case analysis is not required. See Heart of Atlanta Motel, 379 U.S. at 275, 85 S.Ct. at 367; McClung, 379 U.S. at 302-03, 85 S.Ct. at 382-83.
II. Failure to Conciliate
12
As an affirmative defense to this proceeding and any penalty, Morgan claimed that the Secretary failed to meaningfully conciliate. The Fair Housing Act requires that "the Secretary shall, to the extent feasible, engage in conciliation...." 42 U.S.C. § 3610(b)(1). Morgan claims error in the ALJ's evidentiary rulings. The ALJ held two in camera hearings and allowed Riciotti to testify concerning conciliation efforts, but apparently restricted Morgan to a proffer insofar as his testimony. I R. doc. E & F. The ALJ relied on 42 U.S.C. § 3610(d) and 24 C.F.R. § 103.330(a), which generally prohibit public disclosure of conciliation information and its use as substantive evidence concerning discrimination.
13
We find no reversible error concerning this evidentiary matter and we reject Morgan's argument that the present record does not allow evaluation of this claim. To the contrary, the parties do not contest the settlement events, only their characterization. The record establishes that the agency undertook to conciliate, the issue is whether it did so in good faith as required by the cases. See EEOC v. Radiator Specialty Co., 610 F.2d 178, 183 (4th Cir.1979) (Title VII).4
14
Whether the Secretary conducted conciliation in good faith is not jurisdictional; rather, it goes to whether a court should stay proceedings pending further conciliation efforts or entertain the matter immediately. See Marshall v. Sun Oil Co., 592 F.2d 563, 566 (10th Cir.) (ADEA), cert. denied, 444 U.S. 826, 100 S.Ct. 49, 62 L.Ed.2d 33 (1979); EEOC v. Zia Co., 582 F.2d 527, 533 (10th Cir.1978) (Title VII); Baumgardner v. HUD, 960 F.2d 572, 578-79 (6th Cir.1992). The ALJ recognized that the "good faith" inquiry was not jurisdictional and declined to address the adequacy of conciliation, even insofar as monetary relief. I R. doc. M at 8.
15
In determining whether the Secretary has conducted conciliation in good faith, we recognize that the agency "should be given wide latitude in shaping both the general framework of conciliation and the specific offers made;" thus, we do not become embroiled in the details of offers and counteroffers. EEOC v. Sears, Roebuck & Co., 650 F.2d 14, 18 (2d Cir.1981); Zia Co., 582 F.2d at 533. We may look at the conciliation process employed by the agency, however, because if the requirement of conciliation is to have any meaning, the agency must provide a "fair opportunity" for settlement. Sears, Roebuck & Co., 650 F.2d at 19. "While a respondent is certainly not entitled to a successful conciliation, he is entitled to an objectively reasonable effort by the agency to bring about a settlement of the charge." Baumgardner, 960 F.2d at 579.
16
The relevant testimony and the offer of proof, which is not disputed, indicates that the investigator consulted with the complainant and made one monetary settlement offer which was rejected by Morgan. In rejecting the offer, Morgan indicated that he would be interested in a settlement based on actual damages. The complainant was apprised of this overture and rejected it, but Morgan was never contacted again. Although the Secretary tells us that it is evident that his conciliation efforts were in good faith, it is not evident to us. To the contrary, the Secretary's effort ceased to be objectively reasonable when Morgan was not informed at least of the rejection of his overture.
17
Prior to the Secretary's monetary settlement offer, damages had not been itemized or quantified. Morgan's inquiry about a settlement based on actual damages was reasonable, and indicates a potential to narrow the dispute. The Secretary never got back to Morgan, let alone engaged in any further dialogue. This is inconsistent with an "objectively reasonable effort by the agency to bring about settlement of the charge." Baumgardner, 960 F.2d at 579. While it is true that Morgan did not seek a stay of the proceedings to attempt further conciliation, we would be hard pressed to characterize the Secretary's single "take-it-or-leave-it" offer and subsequent silence as meaningful conciliation. It may well be that Morgan would not have settled upon learning of the rejection of his "actual damages" overture, but we feel that the conciliation process should have afforded him the opportunity to make that choice prior to the Secretary's escalation of the conflict. This is not a case where negotiations reached an impasse or the respondent was unwilling to "engage in a meaningful colloquy." See Marshall v. Sun Oil Co. (Delaware), 605 F.2d 1331, 1337 (5th Cir.1979). We believe that the Secretary's conciliation effort, together with all the circumstances, may be considered in reviewing the penalty imposed. See Baumgardner, 960 F.2d at 579.
III. Sufficiency of the Evidence
18
We review the ALJ's decision to determine whether it is "supported by substantial evidence on the record as a whole." Arkansas v. Oklahoma, --- U.S. ----, ----, 112 S.Ct. 1046, 1060, 117 L.Ed.2d 239 (1992); HUD v. Blackwell, 908 F.2d 864, 870 (11th Cir.1990) (relying on 5 U.S.C. § 706(2)(E) & H.R.Rep. No. 100-711 at 38, reprinted in 1988 U.S.C.C.A.N. 2173, 2199). Substantial evidence means " 'such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.' " Richardson v. Perales, 402 U.S. 389, 401, 91 S.Ct. 1420, 1427, 28 L.Ed.2d 842 (1971) (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 217, 83 L.Ed. 126 (1938)). We may not reweigh the evidence or "supplant ... findings merely by identifying alternative findings that could be supported by substantial evidence." Arkansas v. Oklahoma, --- U.S. at ----, 112 S.Ct. at 1060.
19
With respect to the Riciottis' efforts to purchase the Sarno home, the ALJ determined that the Secretary had proven discrimination based on direct evidence. See Pinchback v. Armistead Homes Corp., 907 F.2d 1447, 1452-53 (4th Cir.) (direct evidence case), cert. denied, 498 U.S. 983, 111 S.Ct. 515, 112 L.Ed.2d 527 (1990). The ALJ found that Morgan's enforcement of the "adults only" policy prevented the Sarnos from selling their home to the Riciottis. Morgan contends that the Riciottis' first offer of less than the Sarnos' asking price, followed by an offer from another couple willing to pay the full price, caused the transaction to fail. According to Morgan, as a matter of contract law, the Sarnos could not have sold their home to the Riciottis after receiving another offer for the asking price, and consequently, the ALJ's finding of discrimination is not supported by substantial evidence.
20
Morgan's argument is unavailing. First, the ALJ did not find that the Sarnos immediately accepted the other offer, but had two competing full-price offers and could have accepted either. I R. doc. M at 5. The ALJ found a complete lack of evidence that the Sarnos were precluded from selling their home to the Riciottis merely because an earlier offer had been made. Although Morgan invites us to speculate about the enforceability of the other full-price offer, Pet.Br. at 18 n. 15, no record evidence would cause us to chase that rabbit.
21
More importantly, "this is not a contract law case; it is a ... discrimination case." Blackwell, 908 F.2d at 872. The FHA prohibits refusals to negotiate for the rental of a dwelling space on the basis of familial status, as well as statements indicating such discrimination. See 42 U.S.C. § 3604(a) & (d). The record contains evidence of discrimination that the ALJ chose to credit. Sarno testified on deposition that he had "had a couple of conversations with Lee Morgan at his office, and I told him that I had a buyer for the home but that they had a child. And he was pretty adamant about not selling to somebody with a child. He wouldn't let me do it." Resp.Add. at 12. Sarno further testified that Morgan told him "he would tie this thing up in the courts if he had to." Id. Riciotti testified that Morgan told him that " 'this is an all adult park and we do not allow children here.' " I R. doc. D at 35. This testimony was corroborated by Morgan. Id. at 165-66. The ALJ found that "[t]he Sarnos rejected the Riciottis because they didn't have the time to spend disputing the issue of children with Mr. Morgan." Id., doc M at 5. This finding is supported by substantial evidence. See Resp.Add. at 14, 29. Although Morgan claims that Sarno was biased, we do not reweigh the evidence in our appellate review, even though the Sarnos testified by deposition. Cf. Anderson v. City of Bessemer City, 470 U.S. 564, 574-75, 105 S.Ct. 1504, 1511-12, 84 L.Ed.2d 518 (1985).
22
IV. Damages, Civil Penalty and Equitable Relief
23
We review the ALJ's factual determination of damages for substantial evidence and any penalty for abuse of discretion. See Burke v. Board of Governors, 940 F.2d 1360, 1365-66 (10th Cir.1991) (relying upon 5 U.S.C. § 706(2)), cert. denied, --- U.S. ----, 112 S.Ct. 1957, 118 L.Ed.2d 559 (1992).
24
Morgan first argues that Riciotti should not recover damages because he did not have a contract to purchase the Sarno home. Of course, the existence of a contract is not a prerequisite to liability, civil penalties or damages under the Fair Housing Act. See Blackwell, 908 F.2d at 872; Pinchback, 907 F.2d at 1450-52 (adopting futile gesture theory).
25
Morgan next argues that the damages are excessive and any award should have been limited to out-of-pocket expenses and nominal damages. The ALJ determined the following actual damages:
26
Economic Loss (alternate housing) $ 7,362.49
Inconvenience 1,500.00
Emotional Distress 5,000.00
Lost wages 335.50
Telephone/fax 100.00
----------
$14,297.99
----------
A. Alternate Housing
27
The ALJ awarded damages for alternate housing in the amount of $7,362.49. Although Riciotti was not "forced to obtain temporary or alternate housing," Pet.Br. at 37, we believe that the proper measure of damages is a comparison between what would have been obtained but for the discrimination (Sarno home) and a reasonably comparable dwelling. Such a concept is akin to "cover" under the UCC article 2 concerning sales transactions. See Miller v. Apartments & Homes of New Jersey, Inc., 646 F.2d 101, 112 (3rd Cir.1981) (adopting "cover" rationale). In this case, the ALJ determined that the Krigbaum home was a reasonably comparable dwelling to the Sarno home. Both were offered for sale at about the same time and are located in the same mobile home park.
28
Miller involved $4,451.00 in damages due to increased rent and electricity costs associated with a substitute apartment. Morgan argues that Miller should not apply because of the increased value and equity which would have been received by the Riciottis had they purchased the Krigbaum home. The Miller court dismissed a similar contention, noting that even assuming greater value, a victim of discrimination may be compensated for what would otherwise be a "forced reallocation" of monetary resources to avoid discrimination. Id. Morgan's argument is really one of mitigation, but we will defer to the ALJ if his or her decision concerning a substitute home is reasonable and supported by substantial evidence. Id. Merely because the Krigbaum home was slightly larger and somewhat more expensive ($6,000) than the Sarno home does not render the ALJ's reliance upon it unreasonable. The Krigbaum mobile home was available, and in the park in which the Riciottis wanted to live. While there may be situations in which the disparity in value between the housing opportunity lost and the "cover" housing are so great as to render the comparison unreasonable (and a windfall to the complainant), this is not one of those situations.B. Inconvenience
29
Morgan also contends that the $1,500 awarded for inconvenience is not based on substantial evidence because the inconvenience allegedly experienced by Riciotti was not adequately specified. We agree. Although the ALJ listed several items considered in awarding inconvenience damages, such as (1) time spent in discussions with Mr. Morgan, their attorney, and HUD concerning the Sarno home, (2) not being able to live in the park between loss of the Sarno home and their decision not to purchase the Krigbaum home (approximately one month), and (3) applying for a loan on the Krigbaum home, these items do not support the award.
30
The ALJ double counted in awarding lost wages and inconvenience damages for consulting with the various parties and preparing for the hearing. Additionally, the ALJ's finding that the Riciottis were prevented from living in the mobile home park of their choice for one month, without more, does not constitute compensable inconvenience. The Riciottis were not forced to obtain substitute housing or move from their apartment during this time. Indeed, the Riciottis remained in their apartment until December 1989, when they moved into their townhome. Moreover, the efforts to obtain a loan on the Krigbaum home cannot be the basis for a $1,500 inconvenience award. Mr. Riciotti had already applied for a loan on the Sarno home, and merely called the banker to keep it open for the Krigbaum home; Riciotti did not go forward after that. See I.R. doc. D at 45. The record as a whole does not support the inconvenience award.
C. Emotional Distress
31
Morgan next contends that the $5,000 amount for emotional distress is not supported by substantial evidence. We have recognized that emotional distress damages are available in Fair Housing Act cases for distress which exceeds the normal transient and trivial aggravation attendant to securing suitable housing, Steele v. Title Realty Co., 478 F.2d 380, 384 (10th Cir.1973), but again as with the inconvenience award, neither the fact of emotional distress, nor the dollar amount awarded, are supported by substantial evidence in this record. More than mere assertions of emotional distress are required.
32
We recognize that damages from emotional distress may be inferred from circumstances beyond the ordinary, in addition to being proven by testimony. See Blackwell, 908 F.2d at 872. Medical evidence concerning physical symptoms is not required. Marable v. Walker, 704 F.2d 1219, 1220 (11th Cir.1983). The fact that the damages for such distress are not capable of precise measurement does not bar recovery. Id. at 873. A causal connection must exist, however, between the illegal action and the complainant's injuries. Gore v. Turner, 563 F.2d 159, 164 (5th Cir.1977).
33
As an initial matter, only about ten days elapsed between the loss of the Sarno home and Morgan's retracting the "adults only" rule upon being informed the rule violated the Fair Housing Act. After being informed that they could live there, the Riciottis immediately looked at other homes in the park, deciding to purchase the Krigbaum home in early July 1989. See I R. doc. D at 46, 65 (Riciotti thought the problem with Mr. Morgan had been cleared up by phone conversations in mid-June and did not foresee any problems). Riciotti was very interested in the Krigbaum home, it was "just perfect" and had "[m]ore room than the Sarnos', had a bigger lot, and nice amenities ... it was loaded." Id. at 42. The ALJ determined that Morgan did not prevent the Riciottis from living in the park after he retracted the rule in mid-June, rather the Riciottis chose not to purchase the available Krigbaum home. Thus, Mr. Riciotti's distress arising from events surrounding the Krigbaum home and the eventual occupancy of his townhome in December 1989 cannot be used to support the $5,000 award. See I R. doc. D at 37 (Riciotti testified that "it was like those two months [June and July 1989] were an emotional roller coaster for the whole family"). Our review of the record convinces us that it was these latter events upon which the distress damages are predicated. Moreover, the ALJ recognized that Mrs. Riciotti could not be compensated because she was not a named "aggrieved person," yet he compensated Mr. Riciotti for her stress, notwithstanding his findings that her stress headaches (which began in July) may have been attributable to her changing jobs. The record as a whole does not support the emotional distress award.
D. Civil Penalty and Equitable Relief
34
We also have difficulty with the ALJ's entry of an injunction against Morgan and the award of the maximum civil penalty allowed, $10,000. The ALJ may grant equitable relief and, in order to vindicate the public interest, assess a civil penalty not to exceed $10,000 for a first-time violator. 42 U.S.C. § 3612(g)(3). Injunctive relief is appropriate to deter possible future violations and to "remov[e] any lingering effects of past discrimination." Marable, 704 F.2d at 1221. Concerning civil penalties, the House Report provides:
35
The Committee intends that these civil penalties are maximum, not minimum, penalties, and are not automatic in every case. When determining the amount of a penalty against a respondent, the ALJ should consider the nature and circumstances of the violation, the degree of culpability, any history of prior violations, the financial circumstances of that respondent and the goal of deterrence, and other matters as justice may require.
36
H.Rep. No. 100-711 at 37, reprinted in 1988 U.S.C.C.A.N. at 2198. The Secretary has been granted the authority to impose an appropriate and reasonable penalty; we may modify or set it aside only if it is unwarranted in law or unjustified in fact. See 42 U.S.C. § 3612(k); Butz v. Glover Livestock Co., 411 U.S. 182, 185-188, 93 S.Ct. 1455, 1457-59, 36 L.Ed.2d 142 (1973).
1. Civil Penalty
37
The ALJ imposed the maximum penalty after characterizing Morgan's actions as "serious and egregious." I R. doc. M at 20. His actions were serious because they prevented sales of mobile homes until he was informed of the illegality of the "adults only" rule. Id. Morgan's subsequent actions were egregious, according to the ALJ, because, after learning of the illegality, Morgan "took no immediate steps to comply with the law, except to inform the Riciottis that he would retract the policy." Id. (footnote omitted). The ALJ found that Morgan failed to publicize the change, other than informing the Riciottis, because his chief concern was with their complaint rather than canceling the policy. Id. The ALJ specifically found that Morgan must have known that the other tenants in the park would continue to comply with the policy. The ALJ reasoned that the maximum civil penalty would serve the goal of deterrence by teaching Morgan and others that "adult" communities are not permitted and that "once having learned of the law's requirements, [owners] must take all reasonable steps to eliminate the rules which discriminate against families with children." Id.
38
The ALJ essentially found that Morgan interfered with mobile home sales to families with children subsequent to learning of the invalidity of the "adults only" rule. The evidence will not support such a finding. Although the Secretary urges reliance on Ms. Krigbaum's deposition answer that she believed the park to be an adult park until she sold her home in August 1989, she also testified that (1) the Riciottis previously had informed her that, based on their lawyer's advice, they could purchase her home, notwithstanding her belief that it was an adult park, (2) the Riciottis repeatedly assured her that everything was fine vis-a-vis Morgan, and (3) she had no contact with Morgan during this time period. Resp.Add. at 43-46. Thus, Krigbaum was at least aware that the rule was not being applied to the Riciottis. In fact, she testified that she subsequently referred interested persons with children to Mr. Morgan. Id. Although Krigbaum indicated that she felt bound by her agreement to the park rules, she thought it more of an "ethical issue" stating: "I had lived in a quiet park for many years, and I owed it to the people after me, even though it would have been easy for me to sell to people with children." Id. at 47-48. The record will not support a conclusion that tacit enforcement of the rule by Morgan interfered with the sale of the Krigbaum home after the Riciottis declined to purchase it. While we recognize that, had the facts been present, the ALJ could have found that Morgan's actions interfered with the sale of the Krigbaum home to the Riciottis, he found to the contrary and this has not been appealed.
39
Moreover, the finding that other tenants in the park would continue to comply with the rule in the absence of specific notice to the contrary from Morgan is pure speculation. Morgan argues that neither the ALJ nor the Secretary "point to anything that requires petitioner to do more than he did; he gave actual notice to the complainant and his wife and that ... is sufficient." Pet.Br. at 26 n. 20. This would be a very different case if the Secretary had pled and proved that others were deterred by the rule, see 5 U.S.C. § 556(d) (proponent has burden of producing evidence); Bosma v. USDA, 754 F.2d 804, 810 (9th Cir.1984), but on this record, we agree with Morgan that his failure to give general notice of his determination not to enforce the rule cannot be a basis for the maximum civil penalty.
40
The ALJ found that Morgan "was unaware of the illegality of Rule 3 until this was pointed out to him by [Riciotti's attorney]," in a letter dated June 6, 1989. I R. doc. M at 20; doc. D at 145-46. The "familial status" amendments to the Fair Housing Act were enacted September 13, 1988 and became effective on March 12, 1989. See Pub.L. No. 100-430, § 13(a), 1988 U.S.C.C.A.N. (102 Stat.) 1619, 1636; United States v. Southern Mgmt. Corp., 955 F.2d 914, 917-918 (4th Cir.1992); Gorski v. Troy, 929 F.2d 1183, 1184 (7th Cir.1991). Although Morgan's ignorance of the law will not defeat liability, we think that it is a factor which must be considered in conjunction with the short time the familial status amendments had been in effect. Moreover, upon learning of the invalidity of the rule, Morgan sought the advice of legal counsel and no longer enforced it. He took the affirmative step of notifying the Riciottis. A few months later, the park rules were retyped to omit the invalid rule.
41
Because most of the factors relied upon by the ALJ in imposing the maximum penalty are not supported by substantial evidence, we hold that the ALJ abused his discretion in awarding the maximum penalty. We must reject the ALJ's characterization of Morgan's conduct as "egregious familial status" discrimination. Nor can we sustain the maximum civil penalty on a deterrence rationale; the public interest would not be well served by blanket imposition of penalties without regard to individual and personal conduct and competent proof, including mitigating factors. See Rollins Envtl. Servs. (NJ) Inc. v. EPA, 937 F.2d 649, 654 (D.C.Cir.1991).
42
While the events in question were unfortunate, and in view of the inadequate conciliation in this case, we believe that a civil penalty in excess of $500 would be so unjustified in fact as to constitute an abuse of discretion. See Butz, 411 U.S. at 188, 93 S.Ct. at 1459; Baumgardner, 960 F.2d at 583; Ferguson v. USDA, 911 F.2d 1273, 1283 (8th Cir.1990).
2. Injunctive Relief
43
We also will vacate the injunctive relief granted because the need for it is nowhere demonstrated on the record. See Steele, 478 F.2d at 385. To the contrary, Morgan complied with the law when informed of its existence, and sold the mobile home park in May 1990.
44
We AFFIRM the ALJ's finding of liability and compensatory damages pertaining to economic loss, lost wages and telephone/fax expenses. We REVERSE the $1,500 inconvenience and $5,000 emotional distress damages. We REVERSE the $10,000 civil penalty, and instead award $500. We VACATE the award of injunctive relief.
*
The Honorable Wesley E. Brown, Senior United States District Judge for the District of Kansas, sitting by designation
1
42 U.S.C. § 3604 provides in pertinent part:
Discrimination in the sale or rental of housing and other prohibited practices
As made applicable by section 3603 of this title and except as exempted by sections 3603(b) and 3607 of this title, it shall be unlawful--
(a) To refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling to any person because of ... familial status....
(b) To discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection therewith, because of ... familial status....
(c) To make, print, or publish, or cause to be made, printed, or published any notice, statement, or advertisement, with respect to the sale or rental of a dwelling that indicates any preference, limitation, or discrimination based on ... familial status ... or an intention to make any such preference, limitation, or discrimination.
(d) To represent to any person because of ... familial status ... that any dwelling is not available for inspection, sale, or rental when such dwelling is in fact so available.
42 U.S.C. § 3602 provides in pertinent part:
Definitions
(k) "Familial status" means one or more individuals (who have not attained the age of 18 years) being domiciled with--
(1) a parent....
2
The relevant rules provided:
3
It is management's intention to make the mobile home park entirely an adult park. That is, no children will be allowed in the park. Excepted from this rule are those tenants who own mobile homes in the park as of the date hereof. These individual[s] shall be allowed to have children. Any new tenants as of this date shall be subject to this rule and in the event that said tenants shall have a child born to them, they shall be required to remove or sell their mobile home within a reasonable time, not to exceed six months, after the birth of said child. All visiting children must stay in tenant's yard
19
In the event a tenant wishes to sell his mobile home, the prospect tenants must meet all requirements of the rules and regulation[s] of the park and have management[']s approval. The approval by management shall not be unreasonably withheld
I R. doc. C, answer ex. 1.
3
Mobile home lots for rent are considered dwellings under and within the scope of the Fair Housing Act. See 42 U.S.C. § 3602(b); Stewart v. Furton, 774 F.2d 706 (6th Cir.1985); United States v. Warwick Mobile Home Estates, Inc., 537 F.2d 1148 (4th Cir.1976)
4
Employment law concepts and rules frequently find application in fair housing cases. See Pinchback v. Armistead Homes Corp., 907 F.2d 1447, 1451 (4th Cir.), cert. denied, 498 U.S. 983, 111 S.Ct. 515, 112 L.Ed.2d 527 (1990)
| {
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497 F.2d 925
U. S.v.Tate
74-1083
UNITED STATES COURT OF APPEALS Sixth Circuit
6/10/74
1
W.D.Tenn.
AFFIRMED
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Filed 10/3/14 Fernandez v. Cobert CA2/8
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 EIGHT
MANUEL FERNANDEZ et al., B240686
Plaintiffs and Appellants, (Los Angeles County
Super. Ct. No. LC081234)
v.
JOSEPH M. COBERT et al.,
Defendants and Respondents.
APPEAL from a judgment of the Superior Court of Los Angeles County.
Frank J. Johnson, Judge. Affirmed.
Manuel Fernandez, in pro. per., and CareyLee Moisan, in pro. per., for Plaintiffs
and Appellants.
Lewis Brisbois Bisgaard & Smith, Raul L. Martinez and Kenneth C. Feldman for
Defendants and Respondents.
____________________________________
Plaintiffs and appellants Manuel Fernandez and Careylee Moisan, both self-
represented litigants on appeal, sued their former attorney, defendant and respondent
Joseph Cobert,1 for legal malpractice, breach of fiduciary duty, breach of written contract,
fraud and negligent misrepresentation. The malpractice-based case followed two
underlying lawsuits in which Cobert represented Fernandez and Moisan.
Cobert filed two motions for summary judgment, separately addressing the claims
arising from each of the underlying lawsuits. The trial court granted both motions for
summary judgment, and thereafter entered a final judgment in favor of Cobert.
Fernandez and Moisan appeal. We affirm.
FACTS
General Background
At all relevant times, Fernandez and Moisan separately owned real properties in
Agua Dulce. Fernandez and Moisan were also principals in Rancho Agua Dulce, LLC
(hereafter Rancho), a Nevada limited liability company which purchased a multi-acre
parcel of real property in the Agua Dulce area commonly known as “Oasis Park.”
Between 2005 and mid-2007, Cobert acted as attorney of record for Rancho in a
land dispute lawsuit involving the Oasis Park property. In that underlying lawsuit, a
group of landowners in Agua Dulce alleged that they had easement rights over Oasis Park
to reach a nearby public roadway. Rancho (acting through Fernandez and Moisan) took
the position that the landowners had to purchase the easement rights. In 2008, judgment
was entered against Rancho in the land dispute lawsuit. According to interrogatory
answers in the current legal malpractice action, verified by Fernandez, Cobert billed
Rancho more than $350,000 in legal fees in the land dispute case. Further, in the current
legal malpractice action, Fernandez and Moisan claim that Cobert has held them
personally liable for Rancho’s fees incurred in the land dispute lawsuit.
1
Our references to attorney Cobert include his law corporation, which was also a
named defendant in the current legal malpractice action.
2
During part of the same time period that the Oasis Park land dispute lawsuit,
Cobert represented Fernandez and Moisan in a second case arising from disputes with a
water company in the Agua Dulce area. In 2008, summary judgment was entered against
Fernandez and Moisan in the second case. The judgment entered in the second case
included an award of $250,000 against Fernandez and Moisan for the water company’s
attorney fees. According to interrogatory answers in the current legal malpractice case,
Cobert billed Fernandez and Moisan approximately $97,000 in legal fees for this second
case.
In summary, according to Fernandez’s and Moisan’s claims in the current legal
malpractice based action, they are financially liable for approximately $700,000 in
attorney fees arising from two underlying cases in which they ended up on the losing side
($350,000 + $97,000 to Cobert + $250,000 to the water company). Fernandez and
Moisan claim that their financial liabilities, i.e., the attorney fees liabilities, are the result
of Cobert billing them for legal work which was not necessary, counter-productive, or not
actually done.
The Gillingham Action
The Oasis Park property purchased by Rancho rested between Soledad Canyon
Road and properties owned by several landowners. At some point after Rancho bought
the Oasis Park property, a group of landowners who are identified in the briefs as the
“Gillingham Parties,” along with other area landowners, claimed they had prescriptive
easement rights allowing them to travel to and from their properties, over a part of Oasis
Park, to reach Soledad Canyon Road. Rancho, acting through Fernandez, apparently
indicated its intention to block access over the Oasis Park property unless the landowners
paid money to purchase express easement rights.2
2
Based on this court’s review of the record before us on appeal, it is not clear
whether Rancho’s position (by Fernandez) regarding easements was made before or after
consulting with an attorney.
3
In April 2005, Fernandez and Moisan executed a written retainer agreement with
Cobert. There are differing statements in the parties’ briefs about who hired Cobert. In
their opening brief, Fernandez and Moisan state that Rancho was not a party to the
retainer agreement.3 In his respondent’s brief, Cobert states that he was retained by
Rancho. In either event, Fernandez and Moisan both signed the retainer agreement
identifying themselves as “client.” The retainer agreement included language stating that
“[e]ach individual signing this agreement on behalf of a corporation agrees [to be]
personally liable for all amounts owed to [Cobert] by such corporation.” The retainer
agreement did not expressly state the nature of the legal matter for which Cobert was
being retained, but, plainly, Cobert was retained in connection with the Oasis Park
easement dispute noted above.
In May 2005, Cobert sent a letter on behalf of Rancho to attorneys who were
representing certain title insurers for certain of the property owners in the area of the
Oasis Park easement dispute. Cobert’s letter indicated that it was an “initial proposal” for
working out a resolution of the easement access dispute as to Rancho, and the insurers
and their insureds. The letter included an offer for specified temporary access
arrangements, and a framework for a final signed agreement between the parties.
In June 2005, the Gillingham Parties (represented by different lawyers than those
representing the title insurers noted above) filed a complaint against Rancho, the owner
of record title of the Oasis Park property. The Gillingham Parties’ complaint sought to
quiet title to the prescriptive easement that they claimed existed over Oasis Park. This
case was entitled Gillingham v. Rancho Agua Dulce LLC. (L.A. Super. Ct., No.
BC335672.) The case is identified as the “Gillingham Action” in the briefs, and we do
the same.
3
We do not see Rancho’s name expressly written on the retainer agreement.
4
In September 2005, Rancho (represented by Cobert on the face of all pleadings)
filed an answer and a cross-complaint seeking damages for trespass in the Gillingham
Action. At oral argument of the current appeal, Fernandez acknowledged that it was
undisputed that Cobert represented Rancho in the Gillingham Action.
On April 26, 2007, Cobert filed a Substitution of Attorney form in the Gillingham
Action, indicating that attorney Gregory Pedrick was Rancho’s new legal representative.
The Substitution of Attorney form was signed by Cobert and Pedrick, and by Fernandez
on behalf of Rancho.4
In January 2008, the Gillingham Action was tried to the trial court (Hon. Teresa
Sanchez-Gordon), sitting without a jury. Attorney Gregory Pedrick represented Rancho
at trial. In April 2008, the court signed and entered a judgment in the Gillingham Action.
The judgment awarded each of the Gillingham Parties a respective, legally-described,
permanent, equitable easement over Rancho’s Oasis Park property. Further, the
judgment included provisions for a permanent injunction against Rancho not to interfere
with the Gillingham Parties’ easement rights.
In June 2008, Rancho (represented by new counsel, attorney Frank Marchetti)
filed a notice of appeal. In September 2008, our court dismissed Rancho’s appeal upon a
request for dismissal by Rancho.
The SPV Action
SPV Water Company provides water to the housing development in Agua Dulce
in which Fernandez (along with his spouse) and Moisan resided. Sometime shortly after
April 2004, SPV issued special assessments to its customers in order to pay for new water
4
In his motions for summary judgment, Cobert presented evidence that Fernandez
and Moisan had signed what could be called an end-of-representation agreement in April
2007, at the time he substituted out of the Gillingham Action. The agreement included a
series of recitals to the effect that Cobert’s representation had been professional, and that
his attorney fees up to April 2007 had been reasonable. In the oppositions to the motions
for summary judgment, Fernandez and Moisan submitted declarations stating that they
had not signed the April 2007 agreement. Because the current appeal arises in the
context of summary judgment, and because the facts are disputed, we determine that the
April 2007 agreement should not be considered in addressing the merits of the motions.
5
supplies.5 When the Fernandezes and Moisan and several other customers refused to pay,
the water company recorded liens against the non-paying customers’ properties.
In January 2005, the Fernandezes and Moisan filed a complaint against SPV for
declaratory relief and damages, alleging that the water company’s liens were invalid and
should be released, and that the company had damaged the local area’s water supplies
causing harm to the company’s customers. This case was entitled Fernandez v. SPV
Water Co. (L.A. Super. Ct., No. BC326718.) The parties identify this case as the “SPV
Action,” and so do we.
The Fernandezes and Moisan were represented by an attorney named Ed Orchon
when they filed the SPV Action. By early 2006, a series of demurrers had been sustained
in the SPV Action. In May 2006, Cobert agreed to represent the Fernandezes and Moisan
in the SPV Action for the purpose, in Cobert’s words, of “try[ing] to straighten out that
mess.” The Fernandezes and Moisan signed a letter confirming that Cobert would
represent them in the SPV Action. In June 2006, Cobert substituted in as the attorney of
record for the Fernandezes and Moisan in the SPV action, and, filed a motion for leave to
file a fourth amended complaint in the action. In July 2006, the trial court granted leave
to file the fourth amended complaint. At some point not plainly ascertainable from the
record before us on the current appeal, but apparently around the fall of 2006, attorney
Gregory Pedrick became involved in the SPV Action.6
5
In his respondent’s brief for the current appeal, Cobert brought to our attention
that Fernandez and Moisan served on SPV’s board of directors from July 2002 to April
2004. In 2005, Fernandez and Moisan were charged in a criminal case arising from
activities during their tenure as SPV directors. They eventually pleaded no contest, and
subsequently received felony probation sentences. In December 2010, Division Three of
our court affirmed the judgment. (See People v. Fernandez & Moisan (Dec. 14, 2010,
B215818 [nonpub. opn.].) We do not see any relevance in Fernandez’s and Moisan’s
criminal case for purposes of their current appeal, and do not understand why Cobert has
dedicated a significant part of his respondent’s brief discussing the criminal case.
6
In his motion for summary judgment, Cobert indicated that Pedrick had made a
special appearance at a hearing in the SPV Action in the fall of 2006 when Cobert was
6
On April 26, 2007, Cobert filed a “Notice of Dissociation of Counsel” in the SPV
Action, indicating that Pedrick would “forthwith” be acting as Fernandez’s and Moisan’s
sole counsel in the action. The dissociation of counsel form was signed by Cobert,
Pedrick, the Fernandezes (both Manuel and his spouse), and Moisan.
In September 2007, the trial court entered judgment in favor of the water company
in the SPV Action after granting the company’s motion for summary judgment. The final
judgment in the SPV Action awarded $250,000 to the water company for its attorney fees
against the Fernandezes and Moisan. The Fernandezes and Moisan filed two appeals;
one from the summary judgment and the second from the order fixing the amount of the
attorney fees award. In November 2009, we affirmed the judgment in full, including the
attorney fee award. (See Fernandez et al. v. SPV Water Co. (Nov. 10, 2009, B203902
[non pub. opn.].)
The Legal Malpractice Action
Meanwhile, in April 2008, just after judgment in the Gillingham Action had been
entered, Rancho, the Fernandezes, and Moisan (all represented by legal counsel, namely,
attorney Frank Marchetti) filed an action against Cobert. The operative second amended
complaint alleged causes of action, listed respectively, as follows: legal malpractice (this
encompassed four subparts ––the Gillingham Action before April 2007; the SPV Action
before April 2007; the Gillingham Action after April 2007; and the SPV Action after
April 2007); breach of fiduciary duty; breach of written contract; fraud based on
misrepresentation regarding the need for legal work and based on “billing fraud;” and
negligent misrepresentation.
The second amended complaint alleged the following facts. Cobert “enlarged the
scope of the Gillingham Action and the SPV Action” with “little, if, any” accompanying
benefit to Rancho, the Fernandezes and Moisan. Further, if Cobert had given proper
advice as to the claims of the Gillingham Parties, then Rancho would have sold an
easement, and avoided the extended litigation and attorney fees which ensued. Cobert
unavailable, and that Fernandez and Moisan thereafter asked that Pedrick be allowed to
assist further in the case.
7
also should have advised the Fernandezes and Moisan not to pursue the SPV Action
litigation. If they had not been involved, they would not have been held liable for the
water company’s attorney fees. The second amended complaint does not appear to be
based on allegations that Rancho, the Fernandez and Moisan would have and should have
“won” the two underlying cases had they been properly represented. As noted, the legal
malpractice case seems to be based on the theory that the two underlying cases, or at least
a significant amount of the attorney fees in the cases, should have been avoided.
Cobert filed two separate motions for summary judgment, or, in the alternative,
summary adjudication of issues of each cause of action alleged in the second amended
complaint. One of the motions was directed at claims arising from Cobert’s legal
representation in the Gillingham Action; the second motion was directed at claims arising
from Cobert’s representation in the SPV Action. Rancho, the Fernandezes and Moisan
(now represented by yet another new attorney, William Hamilton) filed oppositions. The
evidence related to the motions for summary judgment is discussed below in more detail.
Before the hearings, Rancho’s claims were dismissed because it failed to post an
undertaking as required of a foreign corporation. (See Code Civ. Proc. § 1030.) At a
hearing on December 16, 2011, the trial court granted both of Cobert’s motions for
summary judgment. The trial court granted the motions for the following stated reasons:
“There [are] two huge, gaping holes in this case that I can see, and I
want to make sure it’s clear this is no reflection on Mr. Hamilton. I know
you just recently came into the case; so I want to make that clear. . . .
“The first hole, particularly with regards to the causes of action for
legal malpractice and breach of fiduciary duty and for breach of contract,
those being the first, second, and third causes of action, there’s just no
evidence of any negligence whatsoever that I can see here.
“I don’t see any breach of any duty. I don’t see any departure from
normal standards in a law practice. I just don’t see it. I looked in vain for
some smoking gun that would at least provide an issue of fact to allow this
8
case to proceed to trial, and I’m not seeing it. It was just not identified for
me in the opposition; and I, frankly, don’t believe it exists.
“The second gaping hole is that, even getting past that minor issue,
I don’t see any causation at all. I don’t see any links between any alleged
negligence which may or may not have occurred and any damages which
were allegedly caused.
“In one case, Mr. Cobert substituted out five months prior to a
summary judgment that was entered adversely against the plaintiffs.
And in another case, approximately a year before a bench trial which was
resolved adverse to the plaintiffs. I just don’t see any causation at all.
“And lastly -- this is almost an afterthought -- I don’t see much proof
of damages. . . . I don’t see what the damages are.
“The opposition itself is replete with instances where assertions of
fact are made that are just not borne out by the uncontroverted evidence
which exists before the court . . . .
“There’s a flat-out denial that the agreement of April 2007 was
entered into; and that’s just obviously not the case. You might as well
argue that the earth is flat as far as that goes. That is so obviously an
improper assertion of fact that it tends to cast aspersions on all the other
ones because that one is just obviously false.”7
The court also found that Fernandez and Moisan, individually, lacked standing to
seek relief arising from the Gillingham Action, because Rancho was the real party in
interest in the Gillingham Action as it had been the client. The court dismissed Rancho
from the legal malpractice action against Cobert for failing to post an undertaking as
required under Code of Civil Procedure section 1030. The trial court also found that
Cobert’s objections to Fernandez’s and Moisan’s proffered evidence were well taken,
7
As noted above (see footnote 4, ante), we have disregarded the April 2007
agreement in addressing the merits of Cobert’s motions for summary judgment.
9
but, beyond this, the court explained that, even assuming it overruled the objections,
“it [] would not make the slightest difference” because Fernandez and Moisan had not
proven any wrongdoing by Cobert.
On January 30, 2012, the trial court entered judgment in accord with its orders
granting Cobert’s motions for summary judgment. In April 2012, Rancho, Fernandez
and Moisan (represented by attorney William Hamilton) filed a joint notice of appeal
from the judgment. Shortly after the filing of the notice of appeal, the California State
Bar ordered attorney Hamilton ineligible to practice law. In May 2013, the State Bar
disbarred Hamilton. Fernandez and Moisan then elected to pursue their appeal in pro per.
Rancho, being without counsel, could not continue its appeal.8
DISCUSSION
I. Respondent’s Motion to Dismiss
Respondent Cobert filed a motion to dismiss this appeal based on the following
grounds: failure to provide an adequate record, failure to point to legal error, failure to
fairly summarize the significant facts and ignoring facts unfavorable to appellants, failure
to designate significant declarations and respondent’s objections, failure to provide a
notice of appeal, and for making reference to matters that are not part of the record on
appeal and or that were not considered by the trial court. While we are sympathetic to
respondent’s claims, we find the record adequate to conduct a review of the summary
judgment rulings on the merits.
In addressing an appeal, we begin with the presumption that a judgment or order
of the trial court is presumed correct, and reversible error must be affirmatively shown.
(Ballard v. Uribe (1986) 41 Cal.3d 564, 574; Denham v. Superior Court (1970) 2 Cal.3d
557, 564.) An appellant must “present argument and authority on each point made.”
(County of Sacramento v. Lackner (1979) 97 Cal.App.3d 576, 591; see also Cal. Rules of
8
Fernandez and Moisan, as Rancho’s members, have not arranged for Rancho to be
represented. To the extent Rancho’s appeal may still be open as a matter of this court’s
docket, the appeal is hereby dismissed. (Caressa Camille, Inc. v. Alcoholic Beverage
Control Appeals Bd. (2002) 99 Cal.App.4th 1094, 1101 [a corporation may not appear in
propria persona, or through an officer or agent that is not an attorney].)
10
Court, rule 8.204(a)(1)(B).) An appellant must direct the reviewing court to the pertinent
evidence or other matters in the record that demonstrate reversible error. (Cal. Rules of
Court, rule 8.204(a)(1)(B); Guthrey v. State of California (1998) 63 Cal.App.4th 1108,
1115.) It is not our responsibility to comb the appellate record for facts, or to conduct
legal research in search of authority, to support the contentions on appeal. (Del Real v.
City of Riverside (2002) 95 Cal.App.4th 761, 768.)
Moreover, an appellant’s election to act as his or her own attorney on appeal does
not entitle him or her to any particular leniency as to the rules of practice and procedure;
otherwise, ignorance is unjustly rewarded. (Rappleyea v. Campbell (1994) 8 Cal.4th 975,
984-985; Lombardi v. Citizens Nat. Trust etc. Bank (1955) 137 Cal.App.2d 206, 208-209;
Gamet v. Blanchard (2001) 91 Cal.App.4th 1276, 1284; Nwosu v. Uba (2004) 122
Cal.App.4th 1229, 1246-1247.)
An examination of the record and briefs demonstrates there is an adequate, though
incomplete record for review of the summary judgment motions. We find the appellants’
briefing to offer a sufficient indication of legal error, and a biased but adequate statement
of facts, which respondent has clarified and expanded upon in its own briefing. Further,
our review of the record includes a properly filed notice of appeal. However, we will not
consider the exhibits appended to the opening brief which were not considered by the
trial court. For all of these reasons, we deny the motion to dismiss the appeal.
II. The Motions for Summary Judgment
Fernandez and Moisan (hereafter collectively Fernandez) contend the trial court’s
decisions to grant Cobert’s two motions for summary judgment were erroneous and must
be reversed.9 We disagree.
A. The Standard of Review
On appeal from a summary judgment, our task is “to independently determine
whether an issue of material fact exists and whether the moving party is entitled to
9
Regardless of what we do with the current appeal, the judgment as it exists in
favor of attorney Cobert and against Rancho will remain in place and in effect. We do
not read the opening brief on appeal to include any claim of error asserted by Rancho.
11
summary judgment as a matter of law. [Citation.] ‘We independently review the parties’
papers supporting and opposing the motion, using the same method of analysis as the trial
court. Essentially, we assume the role of the trial court and apply the same rules and
standards.’ [Citation.] We apply the same three-step analysis required of the trial court.
First, we identify the issues framed by the pleadings since it is these allegations to which
the motion must respond. Second, we determine whether the moving party’s showing
has established facts which negate the opponent’s claim and justify a judgment in the
moving party’s favor. When a summary judgment motion prima facie justifies a
judgment, the third and final step is to determine whether the opposition demonstrates the
existence of a triable issue of material fact. [Citations.] In so doing, we liberally
construe the opposing party’s evidence, strictly construe the moving party’s evidence,
and resolve all doubts in favor of the opposing party. [Citations.]” (Hutton v. Fidelity
National Title Co. (2013) 213 Cal.App.4th 486, 493-494.)
B. Legal Malpractice
Fernandez contends summary judgment must be reversed because he has a viable
cause of action for legal malpractice. Fernandez asserts that an attorney who bills for
services that are unwarranted by the objective circumstances of a case, and who is proved
to have done as much, may be held liable for legal malpractice. In Fernandez’s words:
“Churning for fees is the most basic form of malpractice.” We do not disagree with this
rule of malpractice liability in the abstract, but find that Fernandez has not shown error
associated with his cause of action for legal malpractice based on his excessive billing or
“churning for fees” theory.
To prevail on a claim for legal malpractice, a plaintiff must prove the following
elements: (1) the attorney’s duty to use such skill, prudence, and diligence as members
of his or her profession commonly possess and exercise; (2) a breach of that duty; (3) a
proximate causal connection between the breach and resulting injury; and (4) actual loss
or damage resulting from the attorney’s actions. (Coscia v. McKenna & Cuneo (2001)
25 Cal.4th 1194, 1199.) We accept here that an attorney’s duty to use the skill, prudence,
and diligence of his or her profession includes a duty not to bill for services that are not
12
necessary in a given case. Further, we examine the elements of legal malpractice in the
context of a motion for summary judgment, meaning that attorney Cobert had the initial
burden to show that Fernandez and Moisan could not establish at least one element of
their legal practice claim. The burden then shifted to Fernandez to present evidence
showing the existence of disputed facts on any challenged element.
Attorney Cobert’s two motions for summary judgment were supported by his own
declaration in which he stated that he “believed” he had handled the Gillingham Action
and SPV Action “with the diligence, skill and prudence required” of someone practicing
real estate law. Attorney Cobert’s declaration further averred that he had personally
reviewed all of his billings to assure the accuracy of the work and time expended, and
that the “net effect of any [errors] . . . was in . . . favor [of Fernandez].” Although Cobert
was a percipient witness, he was not disqualified from giving expert testimony in his own
case. (Cf. Kalaba v. Gray (2002) 95 Cal.App.4th 1416, 1420 et seq. [treating physician
may properly give expert testimony].) In addition, Cobert’s motions for summary
judgment were further supported by a declaration from Makram Gharib, who explained
that he had worked as a paralegal in Cobert’s law office during the time of the
Gillingham Action and SPV Action. Gharib testified in relevant part: “As to the
Gillingham Action and SPV Action, I saw [Cobert’s] bills. He never billed for tasks that
were not done or overbilled for tasks. . . .” Gharib testified that Cobert billed at hourly
rates less than allowed under his fee agreements with Fernandez. We are satisfied that
attorney Cobert met his initial burden on his motions for summary judgment by
presenting evidence, through his personal declaration and the declaration of an employee
with personal knowledge, showing that Cobert’s performance measured up to
professional standards, and that he had not engaged in wrongful billing. The burden then
shifted to Fernandez to show the existence of disputed facts.
Fernandez’s opening brief on appeal does not point us to evidence in the record
which supports a finding that Cobert engaged in excessive billing in the course of either
the Gillingham or SPV Actions. Fernandez’s reference to the judgment in the Gillingham
Action does no more than show that the Gillingham Parties won their lawsuit against
13
Rancho for an easement. The loss of the case alone does not tend to prove that an
attorney engaged in valueless legal work or otherwise overbilled. In short, the judgment
in the Gillingham Action does not show that Cobert overcharged during the Gillingham
Action. In the absence of any competent evidence supporting a finding that Cobert’s
legal work was “unnecessary” or “counter-productive” under the standards governing
legal work in the local community, Fernandez has not shown wrongful billing.
Fernandez cites the gross figures for the attorney fees that Cobert billed in
connection with the Gillingham Action. The gross amount of fees charged by an attorney
is not evidence that the fees were excessive, and amounted to wrongful “churning for
fees.” In the absence of any competent evidence supporting a finding that Cobert “should
have” recognized the Gillingham Action to be a loser from the earliest stages of the
litigation, and should have promptly advised Fernandez to settle the case so as to avoid
attorney fees, and showing that Fernandez would, in fact, have agreed to a settlement,
Fernandez has not shown wrongful billing.
A claim that an attorney’s legal work was wasteful of time and money is the type
of claim that must be supported by expert evidence, or, at a minimum, by evidence which
is properly accepted to show a case was worthless. A client’s post-case lament about the
amount of attorney fees that his or her attorney charged is not evidence of wrongful
excessive billing.
Our view of the judgment in the Gillingham Action is the same with respect to
Fernandez’s reliance on the judgment in the SPV Action. The judgment shows little
more than that SPV defeated Fernandez’s claims in the SPV Action. As we have noted,
merely showing that a case was lost does not prove “churning for fees.”
In sum, we reject Fernandez’s argument that the losses in the two cases tend to
prove that most or much of Cobert’s legal work during the cases was unjustified.
Attorneys regularly work professionally and diligently on cases that end up being lost.
14
Fernandez’s remaining citations to the record are to broad blocks of the record,
and do not point us to evidence in support of his “churning for fees” theory of liability.10
C. Breach of Fiduciary Duty
Fernandez contends summary judgment must be reversed because he has a viable
cause of action for breach of fiduciary duty. Again, Fernandez’s argument is that Cobert
engaged in wrongful billing. In other words, Fernandez’s arguments as to his claim for
breach of fiduciary do not independently point to a breach of any ethical standards
governing the loyalty owed a client, but overlay his wrongful billing claim in his
malpractice claim. It is the same claim by different labels. We find that Fernandez has
not affirmatively shown error in the trial court’s order granting summary judgment
insofar as his breach of fiduciary duty claim is concerned.
To prevail on a claim for breach of fiduciary duty, a plaintiff must prove the
following elements: (1) the existence of a fiduciary duty; (2) a breach of the duty, and
damage proximately caused by the breach. (Knox v. Dean (2012) 205 Cal.App.4th 417,
432.) A claim for legal malpractice is distinct from a claim for breach of fiduciary duty,
although a similar evaluation is undertaken; the difference is in fixing the scope of the
duty. In the malpractice situation, the duty is to perform with ordinary competence of a
lawyer; the duty in breach of fiduciary duty is generally fixed by looking to the fiduciary
duties owed under the Rules of Professional contact or other statutory or developed law
related to the loyalty a lawyer owes to his or her client. (See Stanley v. Richmond (1995)
35 Cal.App.4th 1070, 1086.)
Given that the breach of fiduciary duty analysis is presented in the context of
summary judgment it was attorney Cobert’s initial burden to show that Fernandez could
not establish one or more elements of his fiduciary duty based claims. We find Cobert
met this burden for the reasons we stated in the legal malpractice discussion above.
10
His references to pages 270 through 442, and 444 through 455 are not helpful in
finding evidence in support of his argument that summary judgment was improper.
15
In response, Fernandez’s opening brief on appeal points us to evidence showing
raw billing numbers, for example, a bill from Cobert dated October 1, 2005 which stated
that attorney fees totaled $10,564 and that costs totaled $1,436. Such raw billing
numbers do not show wrongful billing. At no point in the opening brief does Fernandez
point to a particular bill, and point to evidence tending to show that the bill was
excessive. The lack of competent evidence in support of Fernandez’s claims is fatal.
Fernandez’s opening brief also points us to the deposition testimony of Marcy
Wolf, a former legal secretary in Cobert’s law office. Wolf’s deposition testimony is
attached as an “exhibit” to the opening brief, and is offered as proof of wrongful billing.
We do not consider this evidence because it appears that Fernandez did not present it in
the trial court. A review of Fernandez’s two separate statements of fact in opposition to
Cobert’s two motions for summary judgment shows that Fernandez did not cite to any
part of Wolf’s deposition testimony in an attempt to defeat summary judgment.11
Instead, the evidence he points to are letters from Cobert to Fernandez. The letters
largely concern Cobert’s information about his attorney fees and costs. The letters were
written during the Gillingham Action, and do not include any statements concerning the
likelihood of success in the Gillingham Action. In addition, he points to interrogatory
responses by Rancho during the legal malpractice case. There, Rancho (by Fernandez)
asserted that Cobert “advised” Rancho that it “should sell the easement” to the
Gillingham Parties for $1 million. Further, Rancho stated that Cobert represented that
11
Of equal or more importance, a review of the deposition testimony that is attached
to Fernandez’s opening brief on appeal does not include specific evidence which would
tend to support a finding that Cobert was wrongly billed in the Gillingham Action and or
the SPV Action. Wolf testified generally about Cobert’s wrongful billing practices. The
problem with Fernandez’s attempt to use Wolf’s generalized deposition testimony as
evidence that Cobert engaged in excessive billing in the course of the Gillingham and
SPV Actions is that Wolf further testified, in connection with specific bills that she was
shown during her deposition, that she had no personal recollection whether the bills
reflected wrongful billing by Cobert as to Rancho, Fernandez, or Moisan. In short, while
Wolf generally accused Cobert of engaging in wrongful billing practices as to his clients,
she could not cite any specific instance of wrongful billing as to Rancho, Fernandez and
Moisan.
16
“the title insurers [for the Gillingham Parties] would pay such amount in order to ensure
that [their insureds] had proper ingress and egress to their homes because the insurers
would not want to risk liability to their insureds.” According to Rancho (by Fernandez):
“Essentially, Cobert convinced Rancho that they had the [Gillingham Parties’] insurers
‘over a barrel.’”
Accepting all of Fernandez’s evidence as true, which we do in the context of a
summary judgment motion, we do not see disputed facts concerning fraud. The various
statements attributed to attorney Cobert are not misrepresentations of fact. Given a
construction in favor of Fernandez, the statements made by Cobert must be seen as overly
optimistic expressions about how the other parties in the Gillingham Action would react
to Rancho’s demands. In other words, Fernandez’s evidence shows attorney Cobert
offered predictions to Fernandez about the positive outcomes which could be expected in
the Gillingham Action. Fraud, however, requires misstatements of fact and an intent to
defraud. We simply see no evidence in the record which shows that Cobert made
misstatements of fact to Fernandez with the intent to defraud. Certainly, attorneys should
be realistic with clients about the potential outcomes of litigation, but offering optimistic
views on the potential outcome of litigation is not a species of fraud.
E. Breach of Contract
Fernandez next contends summary judgment must be reversed because he has a
viable cause of action for breach of contract. Once more, we are not persuaded by
Fernandez’s arguments.
First, Fernandez argues that he and Moisan only, and not Rancho, signed the 2005
retainer agreement with attorney Cobert. We agree with Fernandez that this is what the
evidence shows, but do not understand from his argument how this demonstrates error in
the trial court’s decision to grant Cobert’s motions for summary judgment. Assuming
that Fernandez is arguing that Cobert breached the 2005 retainer agreement which he had
with Fernandez directly, merely pointing to the agreement does show a breach of the
agreement. In other words, accepting that Fernandez and Cobert had a contract, and that
17
the contract would be breached by overbilling, Fernandez still has not demonstrated that
such overbilling occurred.
Second, Fernandez argues that a May 4, 2005 letter which Cobert sent to counsel
for the Gillingham Parties is evidence “that Cobert failed to do the most basic
investigation, to research the easement.” We have reviewed the letter and do not see that
it proves such a failure to investigate. Next, Fernandez argues: “Had
Cobert . . . performed the most basic function to research the easement, he knew or
should have known an easement had existed and been in use since the 1930s.” We have
reviewed the portions of the clerk’s transcript Fernandez cites in support of this
argument, and do not see proof that Cobert knew or should have known about any
existing easement rights. Instead, the references to the record are to the final judgment in
the Gillingham Action. The judgment shows that a trial court found an easement at the
end of the case based on trial evidence showing ingress and egress usage over Rancho’s
property since the 1930’s; the judgment does not show that Cobert knew or should have
known –– at the beginning of the case –– that an easement existed.
Third, Fernandez argues that, in light of the evidence supporting the Gillingham
Parties’ claim of a long-existing easement, Cobert should not have demanded nearly $1
million from the Gillingham Parties to buy easement rights. Without offering any
citation to the evidence in the record, Fernandez asserts that Cobert made the demand to
the Gillingham Parties with the “intent” to “instigate” litigation by the Gillingham Parties
against Rancho, so that Cobert could “submit astronomical fee and cost charges . . . for
work [that Cobert] allegedly was going to accomplish.” Fernandez’s arguments appear to
be a variation on the overall theme in all of his causes of action that Cobert billed for
legal services that were unnecessary or counter-productive. Fernandez argues he
presented enough to show there was a breach of contract because Cobert charged
unreasonable attorney fees in the Gillingham Action. There are no arguments in
Fernandez’s brief that there was a breach of contract in connection with the SPV Action.
18
Once again, Fernandez’s breach of contract claim overlays his legal malpractice
claim, including its predominant theory of wrongful billing. For all of the reasons
discussed above in addressing his other causes of action, we find that Fernandez did not
present any evidence creating a triable issue of fact on a claim of wrongful billing by
attorney Cobert. In the absence of competent evidence showing that Cobert performed
legal work that was not proper under the standard of care, we find no basis for reversing
the trial court’s decision to grant the summary judgment motions.
III. Litigation Other Than the Current Legal Malpractice Action
Fernandez tells us about “new litigation” that transpired after Cobert’s summary
judgment motions were granted in the current case. Fernandez tells us that he was or is
being sued by Pedrick for attorney fees “already paid in the underlying [Gillingham and
SPV Actions].” Fernandez also refers to a legal malpractice case, possibly against
Pedrick, and a settlement “for policy limits in place of filing an answer.” Fernandez’s
assertions are unsupported by references to the record in the current legal malpractice
case, which only involves Cobert.
We do not understand from Fernandez’s statements about attorney Pedrick how it
is that the trial court erred in granting attorney Cobert’s motions for summary judgment
in the current case. Fernandez’s “arguments” here are simply not sufficient to justify our
court in reversing summary judgment in favor of attorney Cobert.
DISPOSITION
The judgment is affirmed. Each party to bear its own costs on appeal.
BIGELOW, P.J.
We concur:
RUBIN, J.
FLIER, J.
19
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493 F.Supp. 117 (1980)
Rochelle DAVIS, P.P.A., Luther Davis and Luther Davis
v.
Robert CASEY, Rita Feeney, Arlene Libon, Donald Bowdoin, and Alexander Sharp.
Civ. A. No. CA78-1029-Z.
United States District Court, D. Massachusetts.
July 2, 1980.
*118 Andrew C. Meyer, Jr., Boston, Mass., for plaintiff.
Bowdoin and Sharp, Francis G. Chase, Asst. Atty. Gen., Boston, Mass., Casey Feeney and Libon, Joseph I. Sousa, Asst. City Sol., Brockton, Mass., for defendant.
MEMORANDUM OF DECISION
ZOBEL, District Judge.
Plaintiff Luther Davis brings this action under 42 U.S.C. § 1983 to recover for injuries to his daughter Rochelle Davis ("Rochelle"), a minor, resulting from continued physical abuse at home. Luther Davis claims on his own behalf and on Rochelle's behalf against various state and city employees Rochelle's school teacher, a school principal, a school nurse, and two administrators of the Massachusetts Department of Public Welfare (DPW) charging that they negligently failed to prevent Rochelle's abuse while she was in parental custody. The case is before me on defendants' motions for summary judgment.[1]
It is undisputed that in 1976 Rochelle was eight years old and was enrolled at the Downey Community School, Brockton, Massachusetts. Defendants suggest that she lived with her adoptive parents, including plaintiff Luther Davis. In his complaint, Luther Davis alleges that throughout the fall of 1976, his daughter would appear at school with "multiple bruises, abrasions and contusions . . . apparent in conspicuous places on [her] body." Complaint, Count I, ¶ 8. He describes these conspicuous wounds as evidence of "serious physical injury" visited upon Rochelle at home, which caused "severe and permanent injuries" including "brain damage rendering her comatose, quadriplegic, and severely retarded". Complaint, Count I, ¶ 11. Because, the complaint alleges, defendants had opportunity to witness Rochelle's injuries, but did not intervene, Luther Davis claims that "[h]e has been deprived of the enjoyment of his daughter's childhood and youth, and her society, companionship and affection . . .", Complaint, Count XI, ¶ 8, and that Rochelle has been deprived of "the right . . . to be protected from harm." Plaintiff's Brief in Opposition to Defendants' . . . Motion for Summary Judgment, at 9.[2]
*119 To state a claim under 42 U.S.C. § 1983, and thus survive the motion for summary judgment, the complaint must allege conduct under color of state law which subjects the plaintiffs or causes them to be subjected, to "the deprivation of any rights, privileges or immunities secured by the Constitution and laws." On defendants' motion for summary judgment, I confront the question whether, taking all allegations in the complaint to be true, the conduct of these defendants can be said to have deprived Rochelle or Luther Davis of protected liberties within the meaning of the Fourteenth Amendment. I determine that it cannot.
The claim in this case arises from two provisions of Mass.Gen.Laws ch. 119, a statute which requires certain public employees to act on their suspicion or knowledge of child abuse. § 51A requires the filing of a report with the Department of Public Welfare (DPW) when "any . . . nurse, public or private school teacher, [or] educational administrator . . . in his professional capacity shall have reason to believe that a child under the age of eighteen years is suffering serious physical or emotional injury . . .". § 51B requires DPW to "investigate and evaluate [in a written statement] the information reported under [§ 51A]". Plaintiff's claim can be simply stated: that school employees breached a duty created by § 51A, and DPW administrators breached a duty created by § 51B, and are thus liable under 42 U.S.C. § 1983 for damages which resulted from Rochelle's abuse at the hands of an unidentified individual.
It is essential to note at the outset that this § 1983 claim does not arise from any action taken directly by the named defendants. Plaintiff concedes that Rochelle was abused and not by the defendants while in parental custody. The claim thus arises from a suggested duty of defendant public employees to prevent a third party from endangering Rochelle's physical well-being and, as part of that proposed duty, to take steps to ameliorate observed injuries. The claim raises an important issue: under what circumstances can § 1983 liability arise from indirect public involvement in tortious conduct of a private individual?
In tracing the limits of official liability under § 1983 for the acts performed by third persons, the courts have identified a number of boundaries.[3] Two are of critical importance to the instant case: supervisory liability of a public official under § 1983 is limited to instances in which an agent of the named supervisor commits the wrong, Martinez v. State of California, 444 U.S. 277, 285, 100 S.Ct. 553, 559, 62 L.Ed.2d 481 (1980), and, additionally, to instances in which the official has a "personal role" in the agent's misconduct. Maiorana v. MacDonald, 596 F.2d 1072, 1077 (1st Cir. 1979), Kostka v. Hogg, 560 F.2d 37, 40 (1st Cir. 1977). See Rizzo v. Goode, 423 U.S. 362, 376, 96 S.Ct. 598, 606, 46 L.Ed.2d 561 (1976) and Furtado v. Bishop, 604 F.2d 80, 89 (1st Cir.), cert. denied, 444 U.S. 1035, 100 S.Ct. 710, 62 L.Ed.2d 672 (1980).[4]
*120 In a recent decision, Martinez v. State of Cal., 444 U.S. 277, 100 S.Ct. 553, 62 L.Ed.2d 481 (1980), the United States Supreme Court affirmed the State's demurrer to a § 1983 claim in which affirmative state action the parole release of a "mentally disordered sex offender not amenable to treatment", Martinez v. State of Cal., 85 Cal.App.3d 430, 149 Cal.Rptr. 519, 522 (1978) aff'd., 100 S.Ct. 553, 99 S.Ct. 2403, 60 L.Ed.2d 1064 (1980), who subsequently committed murder, was held insufficient to constitute a deprivation of rights in a § 1983 claim by the murder victim's father. Martinez reaffirmed a principle of law echoed throughout claims under § 1983: that, to support a claim under § 1983 against a public official, alleged violations must arise from the defendant public official's personal involvement in the wrong. Id. 100 S.Ct. at 559; Rizzo v. Goode, 423 U.S. 362, 376-7, 96 S.Ct. 598, 606-607, 46 L.Ed.2d 561 (1976); Maiorana v. MacDonald, supra. In Martinez, on facts closely analogous to those of the instant case plaintiff alleged that the action of parole release, because it was conduct without which a complained-of murder by a private citizen presumably could not have taken place, was actionable under § 1983. Because the murder was not committed by a state official, however, rather by a private citizen, and because the private citizen "was in no sense an agent of the parole board", id., 100 S.Ct. at 559, the Court determined that the subject "death [was] too remote a consequence of the parole officers' action to hold them responsible under the federal civil rights law". Id.[5]
The complaint does not allege that the named defendants abused Rochelle nor that affirmative state action played any part in her ordeal. The complaint does not allege that Rochelle's attacker was employed or supervised by or even known to the defendants. Accordingly, it fails to state a claim for which relief can be granted, and the motions of all defendants for summary judgment are allowed.
NOTES
[1] The motions for summary judgment, insofar as they raise issues entirely within the pleadings, are treated as motions for judgment on the pleadings. See Rule 12(b), Fed.R.Civ.P.
[2] The allegations can be summarized as follows: that Rochelle was deprived of her "right . . . to be protected from harm", Plaintiff's Brief in Opposition to Defendants' . . . Motion for Summary Judgment, at 9, (citation omitted), because defendant DPW administrators, "by [their] servants, agents or employees [were] notified" of, Counts VIII and IX, at ¶ 5; and defendant school employees "had reasonable cause to believe" (Counts I, ¶ 9; Counts III and V, ¶ 6), "had the opportunity to observe" (Counts I, ¶ 9, Counts III and V, ¶ 6), and "knew or should have known" of (Count III, ¶ 3; Counts IV, VI, XII and XIII, ¶ 5) Rochelle's injuries, and consequently of her ordeal at home, and failed to intervene to protect her from further injury.
[3] I determine in this order that the failure of the complaint to state a claim for which relief can be granted provides a sufficient independent basis for the allowance of summary judgment. Accordingly, I do not address an additional requirement of a complaint under § 1983, about the existence of which I have serious doubt: that the alleged public conduct deprive plaintiffs of rights secured by the Constitution. Whether plaintiff's asserted "right . . . to be protected [by the state] from harm [inflicted by third persons]" has a constitutional basis is doubtful, and plaintiff has included nothing in his memorandum to suggest otherwise.
[4] DiMarzo v. Cahill, 575 F.2d 15 (1st Cir.), cert. denied, sub nom., Hall v. DiMarzo, 439 U.S. 927, 99 S.Ct. 312, 58 L.Ed.2d 320 (1978), affirming § 1983 liability of defendant Massachusetts Commissioner of Corrections for his "pervasive failure . . . to maintain [a county jail] in conformity with constitutional requisites", 575 F.2d at 18, is not inconsistent. In DiMarzo, the supervisor's personal role was not affirmative rather it was a failure to staff, maintain and manage a public facility in conformity with affirmative statutory duties. The court premised its determination of liability upon the finding that the supervisor had both knowledge of constitutional deprivations and statutory responsibility for directing the conduct of the offending agents, 575 F.2d at 17. In short, although § 1983 liability of a supervisor does not require affirmative conduct, it can only arise from the affirmative misconduct of agents of the supervisor, in which the supervisor has a personal role.
[5] The fact that plaintiff in this case might at trial show that certain of the defendants failed to perform or insufficiently performed duties created by state statute does not, of itself, create liability under 42 U.S.C. § 1983, even if such conduct would provide a basis for recovery in a tort action under Massachusetts law, Martinez v. California, supra, 100 S.Ct. at 559; see also Kostka v. Hogg, 560 F.2d 37, 40 n.2 (1st Cir. 1977), and even if it were the proximate cause of Rochelle's abuse, id.
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836 P.2d 936 (1992)
Joseph SONNEMAN, Appellant,
v.
Governor HICKEL, the State of Alaska, and other State Officers and Employees, Appellees.
No. S-4372.
Supreme Court of Alaska.
August 14, 1992.
*937 Joseph A. Sonneman, pro se.
Jack B. McGee, Asst. Atty. Gen., Charles E. Cole, Atty. Gen., Juneau, for appellees.
Before RABINOWITZ, C.J., and BURKE, MATTHEWS, COMPTON and MOORE, JJ.
OPINION
MATTHEWS, Justice.
This case challenges the act which created the Alaska Marine Highway System Fund, ch. 193, § 1, SLA 1990, AS 19.65.050-100, on the grounds that the fund is dedicated to a special purpose in violation of article IX, section 7 of the Alaska Constitution. The trial court ruled that the act was constitutional because it merely "`allows' the legislature to appropriate funds from the fund to the Alaska Marine Highways but does not require it." We conclude that most of the act is constitutional, that the limitation on departmental power to request that the fund be appropriated for capital improvements violates article IX, section 7, and that this section is severable from the rest of the act.
Briefly, the act[1] establishes the Alaska Marine Highway System Fund as a special *938 account in the general fund. AS 19.65.060(a). The Alaska Marine Highway System, the entity responsible for the state's ferries, must deposit the gross revenue obtained from operating the ferry system into this account. The legislature "may appropriate" amounts from the fund back to the Alaska Marine Highway System. AS 19.65.080(a). In addition, the Department of Transportation and Public Facilities (DOTPF), within which the Marine Highway System is contained, may request that the legislature appropriate money from the fund to the Marine Highway System for capital improvements if certain conditions are met. First, the legislature must have made an annual appropriation from the fund. Second, the fund, without regard to the appropriation, must exceed the total of gross revenues plus non-lapsable general fund appropriations by ten percent. Finally, the request for capital appropriations may not exceed fifty percent of the balance remaining after the annual appropriation is made. AS 19.65.080(a) & (b).
The stated purposes of the fund are to "enhance performance and accountability," "provide the management tools necessary to efficiently operate" and, "within constitutional constraints, provide for a predictable funding base for system operations." AS 19.65.050(b). The legislature evidently intended that the Marine Highway System operate under constraints and incentives based partially on the revenues generated by the Marine Highway System. In order for this to work, there must be a reasonable expectation that the revenues generated by the system can be used by the system.
Section 7 of article IX of the Alaska Constitution provides: "The proceeds of any state tax or license shall not be dedicated to any special purpose... ."[2] The question is whether the act violates this constitutional prohibition.[3]
The constitutional convention committee which drafted the prohibition on the dedication of funds commented that the reason for the prohibition is to preserve control of and responsibility for state spending in the legislature and the governor.
Even those persons or interests who seek the dedication of revenues for their own projects will admit that the earmarking of taxes or fees for other interests is a fiscal evil. But if allocation is permitted for one interest the denial of it to another is difficult, and the more special funds are set up the more difficult it becomes to deny other requests until the point is reached where neither the governor nor the legislature has any real control over the finances of the state. In one Rocky Mountain state the legislature is free to appropriate only 17 per cent of the tax collections; the rest are dedicated. In Alaska at present, 27 per cent of territorial funds are earmarked, primarily for school construction and roads.
6 Proceedings of the Alaska Constitutional Convention (PACC) Appendix V at 111 (Dec. 16, 1955).
Without earmarked funds, the constitutional framers believed that the legislature would be required to decide funding priorities annually on the merits of the various *939 proposals presented. Delegate Barrie White, the spokesman for the committee which drafted section 7, stated in the convention debates:
[t]he Committee feels that if you accept the principle of not earmarking, it puts everyone in the same position and that the legislature will then be in the position being able to decide each case on its merits. If you go the other route and allow for earmarking or start drawing up all the exceptions that everybody would want to have drawn up, you are then back to the situation that most states now find themselves in, where an ever-increasing percentage of their revenues are earmarked for special purposes and an ever-decreasing amount is available to the general fund.
4 PACC 2364 (Jan. 17, 1956). Delegate White was then engaged in a colloquy about the appropriation of funds collected through licenses to agencies which had collected them:
Delegate Gray: "It doesn't earmark it but the talking point that these organizations have for the use of this money that is rightfully theirs, why, they haven't been precluded, they just have to sell their viewpoint to the legislature and if they need the money, why they probably could get it if they could talk them into it."
Delegate White: "They have to sell their viewpoint along with everybody else."
Id. at 2367.
The principle on which the act is based, that the administrators of the Alaska Marine Highway System and the legislature will treat the fund as if the Marine Highway System had a right to its proceeds, is inconsistent with the model contemplated by the anti-dedication clause, under which the disposition of all revenues will be decided anew on an annual basis. Nevertheless, the expectations created by the act are merely a "talking point" because they impose no legal restraint on the appropriation power of the legislature.
The act clearly states that the fund is part of the general fund and it may not be spent until and unless it is appropriated by the legislature. AS 19.65.060(b).[4] However, Sonneman argues that the act prohibits the legislature from appropriating money from the fund to government purposes other than the Marine Highway System. Although there is no explicit prohibition, Sonneman contends that there is an implicit one based on a maxim of statutory construction and on various expressions of intent found in the legislative history. The State contends that the act does not prohibit the legislature from using money in the fund for any purpose and, more generally, that the act is basically only an accounting tool designed to give a clear picture of Marine Highway System revenues to the legislature and to the Marine Highway System administrators. We turn first to Sonneman's statutory construction argument.
Since the act states that "the legislature may appropriate amounts from the ... fund to the ... marine highway system," AS 19.65.080(a), Sonneman argues that by implication the legislature may not appropriate amounts from the fund for any other purpose. This argument is based on the maxim expressio unius est exclusio alterius, meaning the expression of one thing implies the exclusion of others. While this maxim is often a useful and logical guide to the meaning of an enactment, it does not always apply. We declined to apply it in Chevron USA, Inc. v. LeResche, 663 P.2d 923, 930-31 (Alaska 1983), finding that the limitation which would result if the maxim were utilized was contrary to the purpose of the statute. Similarly, in the present case it seems clear that the enactment was not intended to legally restrict the power of the legislature to appropriate money from the fund for any purpose. Such a restriction would *940 amount to a dedication of the fund for a special purpose, and given the holding in Alex, the fund would be in violation of the anti-dedication clause. Alaska Statute 19.65.060(b), however, states that nothing in the act "dedicates [Fund money] for a specific purpose." Therefore AS 19.65.080(a) is best read as not implying a prohibition on legislative appropriation of fund money to other than Marine Highway System purposes. This conclusion is bolstered by the rule of interpretation that statutes should be construed if reasonably possible so as to avoid a conclusion that they are unconstitutional. State v. Fairbanks North Star Borough, 736 P.2d 1140, 1142 (Alaska 1987).
Sonneman also argues that various comments made by legislators in the process of enactment of the act indicate an intent to use fund revenues only for marine highway purposes. See AS 19.65.050(b)(1), infra note 1. While there are many such comments,[5] there are also a number of statements that the fund would be legally unrestricted and could be appropriated by the legislature for any purpose.[6] As noted, the act expressly states that it does not dedicate money for a specific purpose. The mixed legislative history is insufficiently persuasive to require a construction of the act at variance with its apparent plain meaning. See Alex, 646 P.2d at 208-09 n. 4 ("the plainer the language, the more convincing contrary legislative history must be").
While the act as we construe it does not restrict the authority of the legislature to appropriate money from the fund, the act is more than merely a legislatively mandated system of accounting. It does restrict executive authority to seek appropriations from the fund. See AS 19.65.080(b). This restriction on DOTPF's authority to request the appropriation of money for capital improvements violates article IX, section 7.
One method of dedicating funds is to preclude the legislature from appropriating designated funds for any reason other than a designated purpose. Another less direct method would be to preclude agencies from requesting monies from designated funds or revenue sources. The constitutional clause prohibiting dedicated funds seeks to preserve an annual appropriation model which assumes that not only will the legislature remain free to appropriate all funds for any purpose on an annual basis, but that government departments will not be restricted in requesting funds from all sources. As the debates make clear, all departments were to be "in the same position" as competitors for funds with the need to "sell their viewpoint along with everyone else." 4 PACC 2364-67 (Jan. 17, 1956). We conclude therefore that the limitations on the ability of DOTPF to ask for funds from the Marine Highway System Fund expressed in AS 19.65.080(b) amount to a dedication in violation of article IX, section 7.
The question which follows is whether the entire act should be declared unconstitutional or whether AS 19.65.080(b) may be severed from the rest of the act.
The Alaska Statutes contain a general severability clause:
Any law heretofore or hereafter enacted by the Alaska legislature which lacks *941 a severability clause shall be construed as though it contained the clause in the following language, "If any provision of this Act, or the application thereof to any person or circumstance is held invalid, the remainder of this Act and the application to other persons or circumstances shall not be affected thereby."
AS 01.10.030. This clause is said to create a weak presumption in favor of severability. Lynden Transport, Inc. v. State, 532 P.2d 700, 712 (Alaska 1975). "A provision will not be deemed severable `unless it appears both that, standing alone, legal effect can be given to it and that the legislature intended the provision to stand, in case others included in the act and held bad should fall.'" Id. at 713 (quoting Dorchy v. Kansas, 264 U.S. 286, 290, 44 S.Ct. 323, 324, 68 L.Ed. 686 (1924). The key question is whether the portion remaining, once the offending portion of the statute is severed, is independent and complete in itself so that it may be presumed that the legislature would have enacted the valid parts without the invalid part. Jefferson v. State, 527 P.2d 37, 41 (Alaska 1974). In our view, the enactment in question clearly meets this test. After AS 19.65.080(b) is deleted, the remainder of the act still has the same meaning that it had with that subsection included. The deleted subsection is a minor part of the overall act and it is difficult to imagine any reason why the legislature which passed the act would not have also favored the act with .080(b) deleted.
For the foregoing reasons, we affirm the judgment in part, reverse the judgment in part, and remand for entry of a judgment declaring that AS 19.65.080(b) violates article IX, section 7 of the Alaska Constitution, but the remainder of the act does not.[7]
NOTES
[1] AS 19.65.050 provides in part:
(b) It is the purpose of AS 19.65.050-19.65.100 to
(1) enable the Alaska marine highway system to manage and operate in a manner that will enhance performance and accountability by allowing the system to account for and spend its generated revenue;
(2) provide the management tools necessary to efficiently operate the Alaska marine highway system;
(3) within constitutional constraints, provide for a predictable funding base for system operations; and
(4) provide for predictability and stability in the service level furnished to communities served by the system.
AS 19.65.060 provides:
(a) There is created, as a special account in the general fund, the Alaska marine highway system fund, into which shall be deposited
(1) the gross revenue of the Alaska marine highway system;
(2) money that is appropriated to the Alaska marine highway system fund by the legislature in an amount that is consistent from year to year and is the amount necessary ... to provide stable services to the public ...; and
(3) any other money that is appropriated to the Alaska marine highway system fund by the legislature....
(b) Nothing in this chapter exempts money deposited into the Alaska marine highway system fund from the requirements of AS 37.07 (Executive Budget Act) or dedicates that money for a specific purpose.
AS 19.65.080 provides:
[O]n an annual basis and under AS 37.07 (Executive Budget Act), the legislature may appropriate amounts from the Alaska marine highway system fund to the Alaska marine highway system.
(b) The Department of Transportation and Public Facilities may request the legislature to appropriate money from the Alaska marine highway system fund to the marine highway system for capital improvements, if
(1) the appropriation under (a) of this section has been made;
(2) the amount in the fund, without regard to the appropriation under (a) of this section, exceeds the total of gross revenue deposited in the fund and the general fund appropriations under AS 19.65.060(a)(2) by 10 percent; and
(3) the amount requested for appropriation under this subsection does not exceed 50 percent of the balance remaining after the appropriation for annual management and operations is made under (a) of this section.
(c) The unexpended and unobligated balance of money appropriated from the Alaska marine highway system fund lapses into the Alaska marine highway system fund at the end of the fiscal year for which it was appropriated.
[2] The section proceeds: "except as provided in section 15 of this article [creating the Permanent Fund] or when required by the federal government for state participation in federal programs. This provision shall not prohibit the continuance of any dedication for special purposes existing upon the date of ratification of this section by the people of Alaska." Alaska Const. art. IX, § 7.
[3] Even though the revenues generated by the Marine Highway System are derived from the transportation of passengers and freight and not from state taxes or licenses as those terms are usually understood, the State does not argue that section 7 does not apply to the Marine Highway Fund. This is doubtlessly because this court in State v. Alex, 646 P.2d 203 (Alaska 1982), construed section 7 to prohibit the dedication of "any source of revenue." Id. at 210. We have no occasion to question this construction in the present case.
[4] AS 37.07.030, which is part of the Executive Budget Act referred to in AS 19.65.060(b), requires that the legislature annually adopt a budget authorizing all proposed expenditures of the state government. Expenditures by the Marine Highway System from the Marine Highway System Fund are within this requirement.
[5] The bill's prime sponsor testified that "[t]he intent of the bill is to allow the Marine Highway System to use the revenues it generates... ." Sen. Jim Duncan, Senate Transp. Comm. Hearings on Senate Bill (SB) 428, Feb. 20, 1990, Legislative Storage and Information Retrieval System (STAIRS) No. STRA90022013 at 11. Chairman of the Senate Transportation Committee Lloyd Jones commented that he felt better about the fact that the legislature would be able to earmark the program receipts. Sen. Lloyd Jones, id. at 20. The House Finance Co-Chairman noted that the purpose of the legislation would be to create a restricted fund within the general fund. The restricted fund would originate from proceeds of the program receipts earned by the state ferry system in order to be used the following year. Rep. Ron Larson, House Fin. Comm. Hearings on House Bill (HB) 439 & SB 428, April 29, 1990, STAIRS No. HFIN90042912 at 4.
[6] Sen. Jim Duncan, Senate Fin. Comm. Hearings on SB 428, March 8, 1990, STAIRS No. SFIN90030809 at 29; Alaska Marine Highway System Director Jim Ayers, id. at 19; Gov. Cowper's Transmittal Letter to Legislature, Jan. 24, 1990.
[7] The other points raised on appeal by Sonneman, including his claim under 42 U.S.C. 1983, clearly lack merit.
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691 F.Supp. 1454 (1988)
MILIN INDUSTRIES, INC., Plaintiff,
v.
UNITED STATES, Defendant.
Court No. 87-10-01053.
United States Court of International Trade.
July 21, 1988.
John R. Bolton, Asst. Atty. Gen., Washington, D.C., Joseph I. Liebman, Atty. in Charge, Intern. Trade Field Office, Commercial Litigation Branch, U.S. Dept. of Justice, Mark S. Sochaczewsky, New York City, for defendant.
Maciorowski & Graf, P.C., (Edmund Maciorowski), Detroit, Mich., for plaintiff.
DiCARLO, Judge:
The United States (defendant) moves pursuant to Rule 12(b) of the Rules of this Court to dismiss for lack of jurisdiction and because the complaint fails to state a claim upon which the Court may grant relief. Defendant's motion to dismiss requires the Court to characterize an act of the United States Customs Service (Customs) in not allowing merchandise from Pakistan invoiced as "rags" into the commerce of the United States. If Customs' action was an "exclusion," as the importer claims, jurisdiction would lie with this Court under 28 U.S.C. § 1581(a) (1982) because Customs denied an importer's protest against the exclusion of merchandise, or under 28 U.S. C. § 1581(i)(3) or (4) (1982) because this dispute concerns a quantitative restriction on goods for reasons other than the protection of public health and safety. If Customs' action was a "seizure," as defendant claims, jurisdiction would lie with the United States District Court for the Eastern District of Michigan under 28 U.S.C. § 1356 (1982).
The Court finds the that merchandise entered on June 23, 1987 was excluded and not seized until June 29, 1987, and that the importer protested this exclusion. The Court holds that the importer has properly invoked this Court's jurisdiction under 28 U.S.C. § 1581(a) (1982) following Custom's denial of the importer's protest.
Background
Plaintiff describes the merchandise involved as cotton terry rags imported from *1455 Pakistan in June of 1987, and states that the issue is the correct classification of these articles under the Tariff Schedules of the United States (TSUS) in order to determine their correct quota category. Customs' Detroit District Office refused to admit the merchandise into the commerce of the United States and seized it on June 29, 1987 pursuant to 19 U.S.C. § 1592(c) for plaintiff's alleged failure to present proper visas for the merchandise under quota categories 363 or 369. Customs' visa requirement depends upon classification of the merchandise under item 366.19, TSUS. Plaintiff claims the merchandise is properly classifiable under items 390.30 or 386.25, TSUS, and thus not subject to quantitative restrictions, or item 382.25, TSUS, and subject to quantitative restrictions under quota category 369.
Plaintiff filed a protest numbered XXXX-X-XXXXXX on August 6, 1987, which Customs denied. Following Customs' denial of the protest, plaintiff filed a complaint in this Court on March 29, 1988 and moved for an order to show cause why this action should not proceed to trial.
At a telephone conference on May 24, 1988, the Court granted plaintiff leave to file an amended complaint to add 28 U.S.C. § 1581(i) (1982) as a basis of jurisdiction. The Court ordered expeditious discovery on the issue of jurisdiction, as well as discovery on the classification issues to allow for the possibility that the trial would proceed.
Discussion
Under 28 U.S.C. § 1581(a) (1982), the Court of International Trade has exclusive jurisdiction of any civil action commenced to contest the denial of a protest, in whole or in part, under section 515 of the Tariff Act of 1930, as amended, 19 U.S.C. § 1515 (1982), which in turn refers to protests of decisions listed in 19 U.S.C. § 1514 (1982 & Supp. IV 1986), which includes "the exclusion of merchandise from entry or delivery or a demand for redelivery to customs custody under any provision of the customs laws," 19 U.S.C. § 1514(a)(4).
Plaintiff cites ten facts as encompassing a protestable exclusion and/or refusal to deliver under 19 U.S.C. § 1514(a)(4) (1982). Schedule B-1, Plaintiffs' Final Memorandum in Opposition to Defendant's Motion to Dismiss.
1. On June 23, 1987, plaintiff's customhouse broker filed entry No. 1761-6 including the subject merchandise. Customs refused to process the entry and release the articles to the importer.
2. On June 24, plaintiff apprised Customs of an arguable discrepancy in the invoice description for the articles. See 19 U.S.C. § 1592(c)(4) (1982). Customs refused to acknowledge this disclosure. Defendant states that Customs did not receive this letter until after an initial examination of the merchandise. Defendant's Reply Memorandum, Affidavit of Mary Latiker, ¶ 8.
3. Customs violated its regulations regarding the rejection of entry documents found to be incorrect. Defendant counters plaintiff's claims that Customs violated its own regulations by stating that 19 C.F.R. §§ 152.2 and 152.3 only apply where Customs makes a protestable classification or appraisement decision, and there was no liquidation of "the towels in the shipment" because they were not invoiced.
4. On June 24, Customs prepared a non-release entry form 1X-DD-38-46 ordering a "hold" on the articles and refused to issue a permit for their release. The hold and refusal to issue a permit encompass a protestable exclusion and/or refusal to deliver.
5. On June 26, plaintiff's customhouse broker sought delivery of the products to a bonded warehouse facility for inspection through the substitution of a warehouse entry [in accordance with 19 C.F.R. § 144.16]. Customs denied this request for substitution.
6. On June 29, a Customs inspector noted a classification and visa requirement on the non-release entry form. Customs refused to issue a permit for delivery and chose to seize the merchandise.
7. On June 29, the merchandise was seized under 19 U.S.C. § 1592(c) on the *1456 basis of an invoice misdescription, a reclassification of the articles, and the failure to provide appropriate visas under the new classification.
8. The alleged "advisory" classification of the imported merchandise was directly related to the decision to "hold" this shipment from delivery.
9. Customs performed an inventory which reflected that at least part of the shipment was properly invoiced as rags. This portion of the merchandise has not yet been released.
10. Customs' alleged refusal to classify the imports precludes the importer from obtaining necessary visas to follow mitigation procedures.
Plaintiff makes alternative claims for each of the ten facts that Customs' actions are contrary to law and arise out of the administration and enforcement of a quantitative restriction on imported goods to accordingly confer jurisdiction under 28 U.S.C. § 1581(i)(3) and (4) (1982). Under 28 U.S.C. § 1581(i), the Court of International Trade is granted exclusive jurisdiction of any civil action commenced against the United States that arises out of any law of the United States that provides for
(3) embargoes or other quantitative restrictions on the importation of merchandise for reasons other than the protection of the public health or safety; or
(4) administration and enforcement with respect to matters referred to in paragraphs (1)-(3) of [28 U.S.C. § 1581(i)] and subsections (a)-(h) of [28 U.S.C. § 1581].
28 U.S.C. § 1581(i) (1982). Section 1581(i) is the residual jurisdiction of the Court and may only be invoked when other available avenues of jurisdiction are manifestly inadequate or it is necessary to avoid extraordinary and unjustified delays caused by requiring the exhaustion of administrative remedies. Dennison Mfg. Co. v. United States, 12 CIT ___, 678 F.Supp. 894, 897 (1988).
Defendant denies plaintiff has submitted evidence of an exclusion under 19 U.S.C. § 1514(a)(4), and adds that approximately 22% of the merchandise agreed to be rags is now being processed for release as a result of the "no change" liquidation of the invoiced merchandise. Customs believes the rest of the merchandise to be towels, and thus states that "approximately 88% [sic] of the subject merchandise was not invoiced (since the invoice describes only rags) and will remain under Customs' custody until the seizure proceedings are completed." Defendant's Final Reply Memorandum, at 3. At oral argument heard July 11, 1988 on the motion to dismiss, defendant conceded that the merchandise agreed to be rags has not yet been released.
Defendant urges the Court lacks jurisdiction because under 28 U.S.C. § 1356 (1982), district courts have original jurisdiction over seizures under any law of the United States, except admiralty and maritime actions and certain actions "commenced by" the United States before the Court of International Trade under 28 U.S.C. § 1582 (1982 & Supp. IV 1986). Section 1582 does not apply here because this action was not "commenced by" the United States. Defendant relies on International Maven, Inc. v. McCauley, 12 CIT ___, 678 F.Supp. 300 (1988), because the Court of International Trade found it lacked jurisdiction over a seizure of allegedly counterfeit products bearing the English Leather trademark. The goods were seized under 19 C.F.R. § 133.23a (seizure of counterfeit goods and forfeiture if imported without permission of the trademark owner), 18 U.S.C. § 545 (forfeiture of fraudulently imported merchandise), and 19 U.S.C. § 1595a(c) (permitting the seizure and forfeiture of any merchandise attempted to be introduced into this country contrary to law, other than in violation of 19 U.S.C. § 1592). The court found that because the goods were never excluded, but rather were seized from the inception of their attempted entry, there was no jurisdiction in the Court of International Trade under 28 U.S.C. § 1581(a). The court also found that was no jurisdiction under 28 U.S.C. § 1581(i) because it is settled that the Court of International Trade is not the appropriate forum to hear claims brought pursuant to 18 U.S.C. § 545. The court *1457 stated the district court was the appropriate forum to contest Customs' seizure, emphasizing that the action's ultimate resolution involved a substantive trademark issue district courts have original jurisdiction. The International Maven decision accords with the Supreme Court's recent gray-market imports jurisdictional ruling in K Mart Corp. v. Cartier, Inc., ___ U.S. ___, 108 S.Ct. 950, 99 L.Ed.2d 151 (1988), which placed jurisdiction in the district courts over seizures of foreign-manufactured goods bearing valid trademarks that are imported without the United States trademark holder's consent. K Mart Corp. v. Cartier, Inc., ___ U.S. ___, 108 S.Ct. 1811, 1814, 99 L.Ed.2d 151 (1988).
An earlier decision by the same judge who decided International Maven provides a closer analogy to the jurisdictional facts of this case. Distinguishing an exclusion from a seizure in R.J.F. Fabrics, Inc. v. United States, 10 CIT ___, 651 F.Supp. 1431 (1986), the court identified a practical effect of an exclusion as to deny entry into the customs territory of the United States, thus allowing the importer to then dispose of the goods as he chooses. In the case of seizures, the court stated the government "often" takes control of the merchandise and may ultimately institute forfeiture proceedings. Id. at ___, 651 F.Supp. at 1436. The defendant had challenged jurisdiction because after excluding the imported merchandise, the government mailed a notice of seizure under 19 U.S.C. § 1592, explaining that seizure had been necessary to prevent the introduction of restricted merchandise, under allegedly fraudulent documents, into the commerce of the United States in an attempt to by-pass quota or visa requirements. The plaintiff then protested the exclusion of the merchandise, and Customs denied the protest. Although the court had provided a practical distinction between exclusions and seizures, the court found it clear that plaintiff had protested the exclusion of merchandise under 19 U.S.C. § 1514(a)(4) and established jurisdiction to review the protest under 28 U.S. C. § 1581(a).
The Court disagrees with defendant's assertion that International Maven compels dismissal of this action. First, while the goods in International Maven were seized from the moment of their importation, in this action the goods were excluded on June 23, 1987 and seized on June 29, 1987. Second, the underlying dispute in this action involves on the proper classification of imported merchandise under the TSUS, rather than an issue of substantive trademark law as in International Maven. Following R.J.F. Fabrics, the Court finds that it has jurisdiction under 28 U.S.C. § 1581(a) (1982).
R.J.F. also found jurisdiction under 28 U.S.C. § 1581(i) (1982). In refuting the government's claim that the plain language of 28 U.S.C. § 1356 placed jurisdiction with the district court, the same claim now made in this action, the court stated that
[w]hile it is true that the wrong addressed by 19 U.S.C. § 1592(a) is attempted entry under false documents ... it is equally true that seizure pursuant to [19 U.S.C.] § 1592(c)(5) is only authorized where there is a violation of [19 U.S.C.] § 1592(a) plus the presence of an additional statutorily specified element; in the case, the need to prevent restricted merchandise from entering the country. Thus seizure would not have occurred unless Customs believed that [a] possible violation of a quota existed.
R.J.F. Fabrics, Inc., 10 CIT at ___, 651 F.Supp. at 1435.
Having reviewed the papers, affidavits, and discovery documents in this case, the circumstances of Customs' seizure under 19 U.S.C. § 1592 (1982) show that the merchandise would not have been seized unless Customs believed that a possible quota violation existed. The resolution of this action requires a determination of whether the imported merchandise is classifiable under item 366.19, TSUS, and thus subject to quota categories 363 or 369, or classifiable under items 390.30 or 386.25, TSUS, and thus not subject to quantitative restrictions, or classifiable under item 382.25, TSUS, and subject to quantitative restrictions only under quota category 369. This is precisely the type of action that should be decided by the Court of International *1458 Trade and to do so furthers the Congressional intent that the Court's expertise and national jurisdiction be "exclusively utilized in the resolution of conflicts and disputes arising out of the tariff and international trade laws...." H.R.Rep. No. 1235, 96th Cong., 2d Sess. 28, reprinted in 1980 U.S. Code Cong. & Admin.News 3729, 3739 (House Committee on the Judiciary Report on the Customs Courts Act of 1980).
Defendant alternatively moves to stay the Court proceedings until 30 days after forfeiture proceedings are complete. Defendant urges that if the merchandise forfeits to the United States, plaintiff would retain no property rights in the forfeited merchandise and thus would have no justiciable claims. Defendant's Memorandum in Support of its Motion to Dismiss, at 3; Defendant's Final Reply Memorandum, at 2-3.
At oral argument defendant acknowledged that forfeiture proceedings have not even been commenced. In R.J.F., the court admonished that the specter of possible civil forfeiture or criminal proceedings in other courts may not be used to frustrate the proper exercise of jurisdiction. There is no reason to reach a different result in this action.
Conclusion
Plaintiff has properly invoked the jurisdiction of this Court under 28 U.S.C. § 1581(a) (1982) by contesting the denial of a protest of the exclusion from entry of its merchandise. As in R.J.F. Fabrics, even if this exclusion were not considered protestable, jurisdiction exists under 28 U.S.C. § 1581(i)(3) and (4) (1982) because the plaintiff's cause of action arises out of the administration and enforcement of a quantitative restriction on imported goods. Defendant's motion to dismiss for lack of jurisdiction and for not stating a claim upon which relief may be granted is denied.
Defendant's motion to stay until thirty days after forfeiture proceedings are completed is denied. Those proceedings have not even been commenced.
Trial is scheduled in Detroit, Michigan at 10:00 a.m. on Wednesday, September 7, 1988.
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442 N.W.2d 223 (1989)
Tom IRGENS and Judith A. Irgens, Plaintiffs, Appellants, and Cross-Appellees,
v.
MOBIL OIL CORPORATION, Successor to the Superior Oil Company, Defendant, Appellee, and Cross-Appellant.
Civ. No. 880278.
Supreme Court of North Dakota.
June 6, 1989.
Rolfstad, Winkjer, McKennett & Stenehjem, P.C., Williston, for plaintiffs, appellants, and cross-appellees; argued by Kent Reierson.
Bjella, Neff, Rathert, Wahl & Eiken, P.C., Williston, for defendant, appellee, and *224 cross-appellant; argued by Dwight C. Eiken.
MESCHKE, Justice.
Tom and Judy Irgens appealed from an order granting a new trial to Mobil Oil Corporation on both liability and damages for failure to properly complete an oil well. Mobil cross-appealed from an order denying judgment notwithstanding the verdict. We affirm.
In December 1984, Mobil drilled an oil and gas well, known as the Johnson well, on Irgens' property in the NW¼ of Section 27-156-100, a part of the East Fork Field near Williston.[1] The well went down to a depth of about 9,400 feet. Initially, Mobil completed the well by simultaneously perforating two separate zones in the well, an upper zone at 9226-9235 feet and a lower zone at 9243-9249 feet. Mobil's engineers then used a light acid treatment on both zones to stimulate fluid entry into the well bore. When that treatment did not produce the desired results, Mobil took additional steps to complete the well.
One of Mobil's choices for completing the Johnson well was a hard acid treatment. This method was suggested by Jim Dahl, an independent completion engineer hired by Mobil to complete the Johnson well. This method would have been preferred by the Irgens. Instead, Mobil completed the well using a hydraulic fracture technique. This method entailed injecting a gel and sand into both zones to create "cracks" for better drainage into the well bore. After this hydraulic fracture, the Johnson well produced too much water and too little oil to be commercially feasible. After producing 5,796 barrels of oil and 33,949 barrels of water in eighteen months, the well was plugged and abandoned.
The Irgens sued Mobil. They claimed that Mobil had failed to act as a reasonable and prudent operator in completing the well. The Irgens sought damages for loss of production from the Johnson well and for diminution in value of their mineral interests in the NW¼ and the NE¼ of Section 27. Mobil insisted that it had acted reasonably, blaming the poor performance of the well on characteristics of the reservoir. A jury returned a verdict in favor of the Irgens and awarded Irgens damages of $506,000:
"(1) Loss of production to the Johnson Well or reduction in value, if any, to Plaintiffs' mineral interests in the NW¼ of 27. $500,000.00
"(2) Reduction in value, if any, to Plaintiffs' mineral interests to the NE¼ of 27. $6,000.00"
Mobil moved for a judgment notwithstanding the verdict or, alternatively, for a new trial. The trial court denied Mobil's motion for judgment notwithstanding the verdict, concluding that the evidence, viewed in the light most favorable to the Irgens, supported the jury's determination that Mobil had not acted as a reasonable and prudent operator in completing the well. However, the trial court granted Mobil's alternative motion for a new trial. The trial court concluded that the theory of reduction in value of the Irgens' mineral interests should not have been submitted to the jury because there was no evidence to support it. The trial court also determined that the verdict was approximately ten times the loss-of-production damages testified to by the Irgens' expert. Because it deemed the verdict excessive on both kinds of damages, the trial court granted Mobil a new trial. The Irgens appealed from the order granting a new trial. Mobil cross-appealed from the order denying its motion for judgment notwithstanding the verdict.[2]
JUDGMENT NOTWITHSTANDING THE VERDICT
Mobil contended that, considering the interests of both lessors and lessees, the only *225 conclusion that the evidence established was that it had acted as a reasonable and prudent operator in completing the Johnson well. Mobil argued that the characteristics of the reservoir, not its method of completing the well, caused the well to be a submarginal producer. The Irgens countered that the evidence, when viewed in the light most favorable to them, did not lead to only Mobil's conclusion. The Irgens argued that there was a reasonable difference of opinion about Mobil's conduct in completing the well and that the jury decided that Mobil did not act reasonably and prudently in completing the well. Therefore, the Irgens contended that the trial court properly denied Mobil's motion for judgment notwithstanding the verdict.
Judgment notwithstanding the verdict should be granted only if the evidence does not present a question of fact for the jury so that the moving party is entitled to judgment on the merits as a matter of law. Okken v. Okken, 325 N.W.2d 264 (N.D.1982). When considering a motion for judgment notwithstanding the verdict, the trial court must determine whether the evidence, when viewed in the light most favorable to the verdict, leads to one conclusion about which there can be no reasonable difference of opinion. Id. The trial court is not free to weigh the evidence or to judge the credibility of witnesses, but must accept the truth of the evidence and all reasonable inferences from that evidence which supports the jury's verdict. Id. In reviewing the trial court's determination on a motion for judgment notwithstanding the verdict, we apply the same standard as the trial court. Id.
A lessee of an oil and gas lease has an implied obligation to the lessors to act as a reasonable and prudent operator in developing, operating, and protecting the property, with due regard for the interests of both lessors and lessees. Johnson v. Hamill, 392 N.W.2d 55 (N.D.1986); Olson v. Schwartz, 345 N.W.2d 33 (N.D.1984). Whether or not a lessee's development and operation of the property was reasonable and prudent is a question of fact. Johnson v. Hamill, supra.
In this case, the local company hired by Mobil to log the Johnson well recommended against perforating it in two separate zones. Instead, Mobil simultaneously perforated the two potentially productive zones. There was evidence that the two zones had substantially different water saturation and that there was a water-bearing zone close to the two perforated zones. There was evidence that after the initial light acid treatment, Mobil did not know which zone was yielding fluid.
Doug O'Neil, an expert petroleum engineer who testified for Irgens, evaluated Mobil's completion of the well. He testified that Mobil should not have simultaneously perforated two zones in this well because of the differences in the zones and because perforating more than one zone made it difficult to determine which zone was yielding fluid. O'Neil testified that, in order to maintain control of the well, the two zones should have been perforated and tested separately rather than together.
O'Neil testified that, once the two zones had been simultaneously perforated, a temporary diverting agent should have been used with the acid treatment to ensure that both zones were opened. O'Neil testified that the initial acid treatment used by Mobil was primarily for cleaning of drilling damage rather than for stimulation. O'Neil further testified that, typically, the hydraulic fracture technique used by Mobil was a last resort for stimulation of an oil-bearing zone near a water-bearing zone because once the water-bearing zone is invaded, the fracture cannot be repaired. O'Neil opined that a hard acid treatment should have been used before resorting to the hydraulic fracture technique.
Mobil's local completion engineer, Jim Dahl, also testified that he had suggested that Mobil first try a hard acid treatment to complete the well. There was also evidence that two offsetting, producing wells, the Irgens 1-27 on the SW¼ of Section 27-156-100 and the Irgens 3-27 on the SE¼ of Section 27-156-100, were both completed with a hard acid treatment. O'Neil opined that, taking the characteristics of this reservoir into consideration, Mobil had *226 not acted as a reasonable and prudent operator in completing the Johnson well.
Mobil presented contrasting opinion evidence that it had acted as a reasonable and prudent operator in completing the well and that the production performance of the well was the result of characteristics of the reservoir, rather than the method of completion. Viewed in the light most favorable to the Irgens, however, the evidence does not lead to one conclusion, favoring Mobil, about which there can be no reasonable difference of opinion. We therefore affirm the trial court's order denying Mobil's motion for judgment notwithstanding the verdict.
NEW TRIAL
The Irgens contended that the trial court granted a new trial on a ground not raised in Mobil's motion for a new trial. Relying on Fowler v. Delzer, 177 N.W.2d 756 (N.D.1970), and Gleson v. Thompson, 154 N.W.2d 780 (N.D.1967), the Irgens argued that a motion for a new trial on the grounds of "insufficiency of the evidence" under Rule 59(b)(6), N.D.R.Civ.P., must specify how the evidence was insufficient. Irgens argued that because Mobil did not specify that there was no evidence concerning a reduction in value of the minerals, that ground for a new trial was waived, citing Sucher v. Oliver-Mercer Electric, 151 N.W.2d 321 (N.D.1967). In effect, the Irgens argued, the trial court granted a new trial on its own initiative without notice and an opportunity to be heard as required by Rule 59(i), N.D.R.Civ.P. The Irgens thus argued that the trial court abused its discretion in granting a new trial.
Mobil's motion for a new trial tracked the language of Rule 59(b)(5), N.D.R.Civ.P., stating that the "verdict of the jury as to damages [was] so grossly excessive and unreasonable under the evidence offered and received that it appears to have been given under the influence of passion or prejudice." Under Rule 59(b)(5), N.D.R. Civ.P., the trial court must consider and weigh the evidence to determine whether a jury award is so excessive as to be without evidentiary support. E.g., Cook v. Stenslie, 251 N.W.2d 393 (N.D.1977).
The trial court stated that "[a]rguably, the record as a whole, including not only the opinion of Douglas O'Neil, but also the evidence of production of surrounding wells, supports the jury's decision" on loss of production from the Johnson well. However, the trial court recognized a "singular troubling aspect" of the submission of two "theories" of damages to the jury: (1) the loss of production from the Johnson well, and (2) the reduction in the value of mineral interests in the NW¼ and NE¼ of Section 27. The trial court specifically concluded:
"In summary, it is impossible to determine whether the jury computed damages based on a decline in production of the Johnson Well or on a diminution in the value of the mineral acres. If it is the latter, there is an insufficiency of evidence to support the verdict. The fact that the jury did find a reduction in value of minerals in the NE/4 of 27 suggests that the jury may have found a similar conclusion with respect to the NW/4 of 27. The conclusion is further supported by reason of the fact that the verdict is approximately ten times the loss of production damages testified to by Plaintiffs' own expert."
The trial court thus decided that, on both kinds of damage, the verdict was so excessive as to be without support in the evidence, a ground for new trial under Rule 59(b)(5), N.D.R.Civ.P. Because of this import of the trial court's decision and because the motion for new trial specified grounds under Rule 59(b)(5), we read the trial court's decision as relying on Rule 59(b)(5). Regan Farmers Union Co-op. v. Swenson, 253 N.W.2d 327 (N.D.1977). We conclude that the trial court did not use a ground not specified in Mobil's motion or grant a new trial on its own initiative. Compare Rule 59(g), N.D.R.Civ.P. Therefore, we conclude that the trial court did not abuse its discretion in this respect.
The Irgens also contended that the trial court erred in granting a new trial based upon a verdict form requested by Mobil.
*227 At first, the trial court proposed a verdict form separating the two kinds of damage:
"(1) Loss of production to the Johnson Well $______
"(2) Damages, if any, to Plaintiffs' mineral interests $______"
Mobil thereafter asked for a change in the verdict form to avoid a double recovery. The trial court submitted a verdict form to the jury identifying both kinds of damage in an interrogatory calling for a single answer.
Generally, a party may not challenge a jury instruction which that party requested. E.g., Wilson v. General Motors Corp., 311 N.W.2d 10 (N.D.1981). To the extent that the trial court used an erroneous verdict form requested by Mobil to rationalize its decision, the error was waived. But, even though "troubled" about having permitted the jury to award damages for both loss of production and reduction in value, the trial court determined that the jury's verdict was not supported by the evidence on either kind of damage. We therefore assess the principal issue: Did the trial court abuse its discretion in granting a new trial because the jury's verdict was excessive?
In Okken v. Okken, supra, 325 N.W.2d at 269, we outlined the trial court's standard for assessing a motion for a new trial:
"If, on the other hand, the motion is for a new trial, the trial judge has a certain amount of discretion in viewing the evidence. Here, the trial court may, within limits, weigh the evidence and judge the credibility of witnesses.... In particular, when a motion for a new trial is made and the reason given in support of the motion is that there was insufficient evidence to justify the verdict, the moving party is asking the trial court to decide whether or not the verdict is against the weight of the evidence. And in making this decision, the trial judge must weigh the evidence ...; he must consider that evidence which supports the verdict equally with that evidence which challenges the verdict. In short, when ruling on a motion for a new trial, the trial judge may consider all the evidence...." [Citations omitted.]
The trial court may weigh the evidence, within limits, but the trial court may not act as a thirteenth juror and substitute its judgment for that of the jury. Grenz v. Kelsch, 436 N.W.2d 552 (N.D.1989).
A motion for a new trial is addressed to the sound discretion of the trial court, and its decision to grant a new trial will not be disturbed on appeal unless there was an abuse of discretion. Okken v. Okken, supra. We have defined an abuse of discretion as arbitrary, capricious, or unreasonable action. Id. Since the granting of a new trial does not end the case, we require a stronger showing of abuse of discretion to reverse an order granting a new trial than to reverse a denial of a new trial. Id.
Within this framework of review, we turn to the evidence about both kinds of damages sought by the Irgens, for loss of production and for reduction in mineral values. Mobil asserted that, although there was evidence of $52,233 for loss of production and of $176,000 for reduction in value, the $506,000 verdict vastly exceeded that evidence. The Irgens did not dispute Mobil's calculation of $176,000 for reduction in value of royalty acres. Instead, they argued that the value of a mineral interest is equal to the present value of the anticipated production revenue. Thus, they argued, if the evidence supported a loss of production with a present value of $500,000, the evidence also supported an equal reduction of their mineral values. The Irgens also relied on the trial court's statement that "[a]rguably, the record as a whole, including not only the opinion of Douglas O'Neil, but also the evidence of production of surrounding wells, supports the jury's decision." In sum, the Irgens contended that, since the evidence supported the jury verdict, the trial court abused its discretion in granting a new trial.
We agree that reduced production of a well may be one factor affecting diminution of market value of the surrounding mineral interests. See Jim's Hot Shot Service, *228 Inc. v. Continental Western Ins. Co., 353 N.W.2d 279 (N.D.1984). Nevertheless, we must consider whether there was sufficient evidence of loss of production to support the jury verdict.
The Irgens' expert, O'Neil, testified that the present value of lost revenue from the Johnson well was $52,233. O'Neil's revenue projection was based on swabbing tests after the light acid treatment, which indicated that the well would produce 24 barrels of oil per day, and on Mobil's estimate that 15% of the 434,000 barrels of oil in place around the well, or 65,100 barrels, was recoverable. O'Neil further testified that, with a different completion method, well production could have been "maybe a hundred barrels a day, maybe two hundred. I don't know." O'Neil also testified that doubled production from the well would have resulted in twice his $52,233 projection for the present value of lost production.
The Irgens also introduced evidence that the average initial production of eleven other wells near the Johnson well was 272 barrels per day, more than ten times the initial production for the Johnson well. However, there was substantial evidence that this field was known for inconsistency and unpredictability in its underlying reservoir and that there were significant differences in permeability and porosity in relatively short distances throughout this field. Evidence showed that, compared to the surrounding wells, the potentially productive zones in this well were "tight," with lower porosity and permeability.
In our view, the evidence about a greater loss of production than $52,233 was extremely speculative. Moreover, the trial court viewed the evidence about reduction in value of the Irgens' mineral interests, approximating $176,000, as weak. In any event, that evidence of value was well below the jury's verdict. The trial court was within its range of discretion in ruling that an award of $500,000 was excessive. We do not believe the trial court acted arbitrarily, capriciously, or unreasonably.[3]
The trial court did not explain its reason for granting a new trial on liability, as well as damages. See Cook v. Stenslie, 251 N.W.2d 393 (N.D.1977). Evidence at the trial indicated that production from an oil well depends upon the interrelationship of the reservoir's characteristics and the well's completion. While there was strong evidence of Mobil's liability in negligently completing the well, this interrelationship with the reservoir's characteristics intertwined the issue of damages with liability. Therefore, we conclude that a new trial on both issues was appropriately ordered.
The order denying Mobil's motion for judgment notwithstanding the verdict is affirmed. The order granting a new trial is affirmed.
NOTES
[1] Superior Oil Company spudded in the Johnson well. During completion, Mobil acquired Superior.
[2] Neither party questioned the reviewability of these orders absent a Rule 54(b) judgment. See Grenz v. Kelsch, 436 N.W.2d 552 (N.D.1989) [Meschke, J., concurring]. Although our decisions have not extended our recently reformulated finality doctrine to an order for a new trial, we have not yet ruled out that possibility. As yet, no one has made an appropriate motion to put the issue precisely before us. See Grenz v. Kelsch, supra, [Meschke, J., concurring].
[3] The Irgens also asserted that the trial court "abused its discretion by waiting six and one-half months after trial to determine, without the benefit of a trial transcript, that there was insufficient evidence to support giving an instruction on the reduction in the value of the minerals." The Irgens argued that it was "unreasonable for the Trial Court to wait so long that it forgot substantial evidence." However, Mobil's motion was based upon the "minutes of the Court, and a partial transcript of the proceedings." See Rule 59(d), N.D.R.Civ.P. There is nothing to indicate that the trial court forgot substantial evidence. The Irgens' argument is unpersuasive.
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251 U.S. 355 (1920)
EASTERN EXTENSION, AUSTRALASIA & CHINA TELEGRAPH COMPANY, LIMITED,
v.
UNITED STATES.
No. 357.
Supreme Court of United States.
Argued December 15, 1919.
Decided January 12, 1920.
APPEAL FROM THE COURT OF CLAIMS.
*356 Mr. Louis Marshall for appellant.
Mr. Assistant Attorney General Davis, with whom Mr. W.F. Norris was on the brief, for the United States.
MR. JUSTICE CLARKE delivered the opinion of the court.
The appellant, claimant, is the grantee from the Government of Spain of three concessions to lay down and operate submarine cables. The first one, in 1879, was for the exclusive privilege, for forty years, of constructing and operating a cable between the Island of Luzon and Hongkong. It was landed at Bolinao, on the northerly coast of Luzon, and dispatches were transmitted to Manila and other places by government owned land lines, which were subject to interruption. This concession required that official messages be transmitted free and be given precedence. In 1898 a second concession, supplemental to the first, empowered the claimant to extend its cable to Manila and the term of the prior exclusive grant was extended twenty years, with the same priority for official dispatches, but with the provision that they were to be *357 transmitted free, only for the first ten years from the date of this second grant.
In 1897 a third concession, the one with which this case is chiefly concerned, authorized the claimant to lay down and operate three submarine cables, connecting the Island of Luzon with three Visayas Islands, Panay, Negros and Cebu. This grant required the claimant: to operate the cables for twenty years; to give precedence to official dispatches and to charge for them at one-half the rates charged for private messages; to pay a tax of ten per cent. On receipts in excess of expenses not to exceed £ 6,000 per annum, an additional tax of "fifty centimes of a franc" per word on telegrams transmitted, and a surtax of "five centimes of a franc" per word on telegrams between the four islands named in the grant and others of the Archipelago.
The Government of Spain, on its part, agreed to pay the claimant, in equal monthly instalments, an annual subsidy of £ 4,500 during the term of the grant.
All of the cables were promptly laid down and put in use and those of the third grant are designated in the record as the "Visayas cables," and the grant as the "Visayas concession." This suit is to recover the amount of the subsidy provided for in the third concession, which had accrued when the petition was filed.
The United States denied all liability, and the judgment of the Court of Claims, dismissing the petition, is before us for review.
The case was here before on appeal and this court held (231 U.S. 326) that the case as then stated in the petition, was not within the jurisdiction of the Court of Claims, whether viewed as asserting an obligation growing directly out of the treaty with Spain or one imposed by principles of international law upon the United States as a consequence of the cession of the Islands by the Treaty. The court, however, referring to certain general and indefinite *358 allegations in the petition, suggested that the implication might be drawn from them that there may have been action on the part of officials of the Government of the United States since it had assumed sovereignty over the Islands, which, if properly pleaded and proved, would give rise to an implied contract with the claimant outside the Treaty, which would be within the jurisdiction of the Court of Claims, and, to the end that the right to have such a claim adjudicated might be saved, if it really existed, the case was remanded for further proceedings in conformity with the opinion.
Doubtless inspired by the suggestion from the court, an amended petition was filed, in which claimant alleged with much detail; that the Government of the United States had used the cables extensively for official messages, which had been given precedence and had been transmitted, as required by the terms of the two concessions, over the Hongkong cable free until 1908 and thereafter at one-fourth of the regular rate, and over the Visayas cables at one-half the rate charged for private dispatches; that the claimant had paid and the Government accepted the ten per cent. tax on receipts from messages, computed as required by the third concession; that since the American occupation the service over the Visayas cables had been extended and improved at large expense by arrangements with duly authorized officers of the Government; and that in August, 1905, the claimant had paid and the Government had accepted a balance due on an account stated in a form indicating an adoption of the terms of the concessions. By this course of conduct, it was averred, the United States "assumed and adopted" all of the obligations imposed on the Government of Spain by the concessions, and agreed with the claimant to discharge and perform all of them and especially agreed to pay the annual subsidy of £ 4,500, as required by Art. 10 of the third concession.
*359 Trial by the Court of Claims resulted in findings of fact, as follows: That the concessions were made to claimant as alleged and that all of the cables were completed and in use when the Treaty with Spain was signed, December 10, 1898; that the Government used the cables extensively for official dispatches which were given priority in transmission, but that this was in accordance with the International Telegraph Convention, as well as in compliance with the terms of the concessions; that the claimant charged the Government for messages over the Visayas cables at one-half the rate charged for private dispatches, which is the rate prescribed by the third concession, but that it "has paid the full rates charged by the claimant for messages over any of the lines" and claimant had authority to make its own rates; and that it is not true that the claimant transmitted messages over the Hongkong cable free of charge "The United States Government has paid full established rates on the Hongkong-Manila cable."
It is further found that since December, 1901, the claimant has made claim to the subsidy in annual statements to the authorities of the Philippine Government, in which the terms of the concession granting it were referred to and in which the United States was charged with the amount of it then accrued. With respect to these, except as hereinafter noted, the court finds that whether any reply was made to them "does not appear from the record."
Much significance is attached by the claimant to the statement presented on June 11, 1905. The finding with respect to this is that on that date the claimant's representative forwarded to "The Secretary of Finance and Justice," an officer of the Philippine Government at Manila, a communication, with an attached statement, purporting to show the amount "due to the United States Government in the Philippines on account of the transmission *360 of all United States Government traffic over the Manila-Hongkong cable, as per the concession granted us for the laying of the same, up to and including December 31, 1904."
In this statement the Government is credited (as if the amount had not been paid) with what it had paid for service over the Hongkong-Manila cable, laid under the first and second concessions, from August 21, 1898, to December 31, 1904, and it is charged with "Visayas subsidy," under the third concession, £ 4,500 per annum to December, 1904. Thus a balance was arrived at of £ 4,712.10.6 in favor of the United States, as to the disposal of which "I shall be glad to receive your instructions," wrote the representative of the claimant.
In reply to this the Auditor of the Government of the Philippine Islands, to whom it had been referred, wrote to claimant's representative at Manila, acknowledging receipt of his letter in which it was stated "there is due the Insular Government under your concession the sum of £ 4,712.10.6" and the Auditor added "It is respectfully requested that said amount be deposited with the Insular Treasurer as miscellaneous revenue." Payment was made and receipt given by the Treasurer of the Government of the Philippine Islands for the amount as "due Government as per statement of account rendered by Eastern Extension, etc., Telegraph Co. to Secretary, Finance & Justice June 11, 1905."
Each year after 1905 the claimant sent a statement to the "Secretary of Finance and Justice" at Manila in the form following: "The United States Government at Manila in account with the Eastern Extension, Australasia and China Telegraph Co., Limited. . . . Free transmission of American Government Telegrams over Hongkong-Manila Section." Then follow credits for messages passing over the Hongkong-Manila cable, as if they had not been paid for, and a debit of the "Visayas *361 subsidy" accrued to the date of the statement. To these no reply appears to have been made.
It is expressly found that:
"Except the payment above referred to in 1905, the claimant has never paid anything into the treasury of the Philippine Government. It does not appear that any part of said sum was paid into the Treasury of the United States. Nor has the claimant paid any sum to the United States Government."
The only payment of the ten per cent. tax under the third concession was that made in 1905, £ 184.17.2, and the statement showing this balance in favor of the United States concluded:
"I therefore have the honor to request that the necessary permission be given to the Treasurer to receive these amounts, now standing to the credit of the United States Government in the Philippines."
Of its own motion the claimant, in 1899, made extensions of the Visayas cables at a considerable expense. But the finding with respect to this is:
"These extensions were carried out with the approval of the military authorities in control of the Philippines at that time, and by the sanction of the United States Government, but without prejudice to, and with the reservation of, all rights of the Government of the United States."
The following is from the court's finding of fact No. IX:
"Between the 10th day of December, 1898, and March, 1899, considerable correspondence was exchanged between the Government of the United States and the claimant regarding the transmission of official telegrams over the Hongkong-Manila cable at reduced rates.
"On the 1st of March, 1899, the Secretary of War transmitted to the chairman of the claimant company a telegram, stating that the War Department `accepts the courteous offer of your company to transmit messages *362 free between Hongkong and Manila, providing that this acceptance leaves in abeyance Spanish concession which is now under consideration.' On the following day the claimant's reply was transmitted to the War Department, stating that the foregoing telegram had been received and the reservation therein noted, and that `the company have pleasure in affording all possible facilities to the United States Government in connection with the transmission of their telegrams.' On the 28th of March, 1899, a written communication was transmitted by the War Department to the duly authorized representative of the claimant company, to the effect that `upon careful reconsideration of the subject it is deemed inadvisible for the department to avail itself of your company's offer. I beg to state, therefore, that the department will pay the established rates on official cable messages, and all accounts of this character presented to the United States will be paid.' This communication concluded with a renewal of thanks `for the voluntary reduction in rates which your company has so courteously tendered.' The United States Government has paid full established rates on the Hongkong-Manila cable, and has paid the established rates on the Visayas cables on its messages."
Upon these findings of fact and upon principles and analogies derived from the law of private contract, the court must proceed to judgment. For it was determined by this court on the former appeal, that any right in the defendant derived directly from the Treaty with Spain, or any obligation imposed upon the United States by principles of international law as a consequence of the cession of the Islands, would not be within the jurisdiction of the Court of Claims, and counsel for claimant, expressly disclaiming the assertion of any right under the Treaty of Paris, urge that the case be treated exactly as it would be if it arose between two private citizens.
*363 So regarding the case. It is obvious that no express contract by the United States to adopt and be bound by the third or any of the concessions can be made out from the findings of fact, and it is equally clear that such an implied contract, using the words in any strict sense, cannot be derived from the findings, for it is plain that there is nothing in them tending to show that any official with power, express or implied, to commit that Government to such a contract ever intended to so commit it.
The contention of the claimant must be sustained, if at all, as a quasi-contract, as an obligation imposed by law independent of intention on the part of any officials to bind the Government, one which in equity and good conscience the Government should discharge because of the conduct of its representatives in dealing with the subject-matter.
It is argued that the United States should be held to have assumed the burden of the concession because it derived benefits and advantages from the use of the cables.
These cables were in operation when the United States Government assumed jurisdiction over the Islands. It extended a much more efficient governmental protection over the lines than they had before, but left the claimant in full ownership and control over them with the power to determine rates for service. The Government, to be sure, availed itself of the advantages of communication which the cables afforded, but for such service it paid the rates which the claimant demanded and which it must be assumed were adequate. From such circumstances as these, very clearly, the law will not raise an obligation on the part of the Government to assume the burden of the subsidy on the principle of undue enrichment or of advantage obtained. It used the cables as other customers used them and from such a use, paid *364 for at the full rate demanded, no obligation can be derived by implication.
It is further contended that the terms and conditions of the concession should be imposed on the Government because the officials of the Philippine Government accepted taxes computed as provided for by the third grant.
The finding of the Court of Claims is not that the Philippine Government demanded or exacted the small amount of taxes that was paid, but that the claimant itself computed the amount in the manner which it thought was provided for in the concession and tendered payment, which, after repeated urging, was accepted by local officers of the Philippine Government, so subordinate in character that it is impossible to consider them as empowered to commit the Government of the United States to the large responsibilities now claimed to spring from their conduct.
The finding with respect to extension of the cables in 1899 excludes all suggestion of the assumption of any liability by the United States on account of the expenditure involved.
The form of the statement of account of December 31, 1904, showing a balance favorable to the United States, which was paid to and accepted by the Treasurer of the Philippine Government, and from which so much is claimed, is not impressive as creating the asserted liability.
Here again the claimant, without suggestion of demand from the Government of the United States or even from the Philippine Government, prepared a statement and, in order to give it the form of an account, was obliged to treat as unpaid, charges for tolls over the Hongkong-Manila cable all of which had been paid by the United States Government and accepted by the claimant.
A separate government, sustained by its own revenues, has been maintained for the Philippine Islands ever since they were ceded to the United States. At first military, *365 it became a civil government in 1902, organized as provided for by an act of Congress (32 Stat. 691, c. 1369), with a Governor General, and executive, legislative and judicial departments, all subject to the supervision of the Secretary of War of the United States.
It is surprising that the claimant, when it desired to have these important concessions, with their large obligations, adopted by the Government of the United States, did not make application for that purpose directly to that Government or to its Secretary of War, or at least to the Governor General or legislative department of the Philippine Government, instead of relying for its adoption by implication, as it has done, chiefly upon the form in which the accounts were presented to the Secretary of Finance and Justice of the Philippine Government.
The action of a department head of the Philippine Government, (inconsistent with the position taken by the Secretary of War in 1899, with respect to the subject-matter) in accepting a voluntary payment of $23,000 cannot be made the sufficient basis for implying an obligation on the part of the Government of the United States to pay a bonus of a total aggregate of almost $440,000.
If doubt could be entertained as to the correctness of this conclusion it would be disposed of by the fact that when the claimant, in March, 1899, tendered to the Secretary of War, so far as appears the only official of the United States with large powers, who considered the subject, the privilege of free transmission of messages over its Hongkong-Manila cable, as was provided for in the first concession, the offer was politely but firmly declined, with the statement that "the department will pay the established rates on official cable messages, and all accounts of this character presented to the United States will be paid," a promise which the findings show that he and his successors in office have faithfully kept.
In the jurisdiction given to the Court of Claims Congress *366 has consented that contracts, express or implied, may be judicially enforced against the Government of the United States. But such a liability can be created only by some officer of the Government lawfully invested with power to make such contracts or to perform acts from which they may be lawfully implied. Langford v. United States, 101 U.S. 341, 345; United States v. Buffalo Pitts Co., 234 U.S. 228; Tempel v. United States, 248 U.S. 121; Ball Engineering Co. v. J.G. White & Co., 250 U.S. 55.
The foregoing discussion makes it palpably plain that no contract, express or implied, to pay the disputed subsidy, was made by any officer of the United States, and the judgment of the Court of Claims is therefore
Affirmed.
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666 F.Supp. 1352 (1987)
MACHINISTS AUTOMOTIVE TRADES DISTRICT LODGE NO. 190 OF NORTHERN CALIFORNIA, International Association of Machinists and Aerospace Workers by its Affiliated Local Lodge 1546, et al., Plaintiffs,
v.
PETERBILT MOTORS COMPANY, Paccar, Inc., Craig Imrie, and Does I through XX, inclusive, Defendants.
No. C-86-6275 RFP.
United States District Court, N.D. California.
March 27, 1987.
*1353 Jonathan H. Siegel, Boltuch & Siegel, Oakland, Cal., for plaintiffs.
Garry G. Mathiason, Kevin P. Block, Littler, Mendelson, Fastiff & Tichy, San Francisco, Cal., for defendants.
MEMORANDUM AND ORDER GRANTING MOTION TO REMAND TO STATE COURT
PECKHAM, Chief Judge.
INTRODUCTION
The defendants in this case move for dismissal or summary judgment. The plaintiffs move to remand the case to state court. The court denies the defendants' motion to dismiss and grants the plaintiffs' motion to remand.
BACKGROUND
The plaintiffs in this case are four labor unions representing all of the unionized employees who worked at the Peterbilt Motors Company ("Peterbilt") truck manufacturing facility in Newark, California prior to its closure around October 1, 1986. The plaintiffs were the authorized bargaining agents for the workers at the Newark plant, and, in March 1984, they entered into a collective bargaining agreement that was scheduled to expire February 28, 1987. The defendants in the case are Peterbilt, its owner Paccar, Inc. ("Paccar"), and its operations manager Craig Imrie. In addition to the Newark facility, Peterbilt and Paccar own and operate two other truck manufacturing plants within the United States.
This case arises out of the defendants' conduct prior to the closure of the Newark plant. The plaintiffs allege that, beginning around May 16, 1986, the defendants informed them in unequivocal terms that the Newark plant would be closed unless the plaintiffs offered concessions in the terms and conditions of their employment superior to those offered by the unions at the other two Peterbilt plants. According to the plaintiffs, the defendants had already decided to shut down the Newark plant when these promises were made, and ultimately did shut down the plant despite the fact that the plaintiffs proposed labor cost modifications that complied with the defendants' requests.
Based upon these facts, the plaintiffs filed this complaint in the Alameda County Superior Court. The complaint contains the following state law claims: (1) intentional misrepresentation, (2) negligent misrepresentation, (3) breach of fiduciary duty, (4) intentional infliction of emotional distress, (5) negligent infliction of emotional distress, (6) negligence, (7) bad faith breach of contract, (8) breach of covenant of good faith and fair dealing, and (9) wrongful termination violative of public policy. The defendants removed the case to this court on November 5, 1986.
DISCUSSION
The defendants contend that this court has jurisdiction over the case because the plaintiffs' ninth cause of action is an "artfully pled" claim under section 301 of the Labor-Management Relations Act ("LMRA"), 29 U.S.C. § 185(a), and because the remaining causes of action are preempted by the National Labor Relations Act ("NLRA"), 29 U.S.C. § 151 et seq. For *1354 the sake of clarity, the plaintiff's ninth cause of action will be addressed first.
1. The Wrongful Termination Claim
Although preemption is usually a defense to state law claims, and thus does not provide a basis for removal jurisdiction, removal is appropriate if federal law, in addition to preempting state law, also confers a federal remedy upon the plaintiff. See Williams v. Caterpillar Tractor Co., 786 F.2d 928, 930-33 (9th Cir.), cert. granted, ___ U.S. ___, 107 S.Ct. 455, 93 L.Ed.2d 401 (1986); Harper v. San Diego Transit Corp., 764 F.2d 663, 666 (9th Cir.1985); Scott v. United Motor Mfg., Inc., 632 F.Supp. 891, 893 (N.D.Cal.1986). This form of federal removal jurisdiction, known as the "artful pleading" doctrine, requires the court to make "two distinct inquiries, both of which must be satisfied to permit removal of an action to federal court." Williams, 786 F.2d at 932. First, the court must determine "whether `it is apparent from a review of the complaint that federal law provides plaintiff a cause of action to remedy the wrong he asserts he suffered.'" Id. at 933 (quoting Hunter v. United Van Lines, 746 F.2d 635, 643 (9th Cir.1984), cert. denied, 474 U.S. 863, 106 S.Ct. 180, 88 L.Ed.2d 150 (1985)). Second, if federal law does provide an analogous substitute cause of action, then the court must determine whether the state law cause of action is preempted. See id.
The plaintiff's ninth cause of action in this case alleges wrongful termination in violation of the public policies of the State of California. The complaint describes the public policies allegedly violated in the following terms:
In acting towards plaintiff as herein alleged, defendants, and each of them, violated the public policy and express and/or implied stated statutory objectives of the State of California, including but not limited to:
a. Deceit and misrepresentation, C.C. § 1709, 1710.
b. Negligent conduct, C.C. § 1714.
c. The labor law statutes of the State of California, and particularly Labor Code § 923.
d. California Unemployment Insurance Code § 100 in favor of permanent employment as a recognized interest of the State of California.
e. A policy against the arbitrary foreclosing of employment opportunities, in violation of the due process and equal protection clauses of the California Constitution, Art. I § 7.
f. The policy of the State of California is "to foster, promote, and develop the welfare of wage earners of California ... to advance their opportunities for profitable employment." California Labor Code § 50.5.
g. The policy of the State of California mandates that an employer "indemnify employees for losses caused by the employer's want of ordinary care." California Labor Code § 2801.
Complaint ¶ 93.
The defendants contend that the plaintiff's wrongful termination claim was properly removed to this court because there exists an analogous and preemptive federal cause of action in § 301 of the Labor-Management Relations Act, 29 U.S.C. § 185(a), which provides a federal claim for breach of a collective bargaining agreement. The defendants point out that Articles 4 and 29 of the collective bargaining agreement between the parties permit dismissal of employees only for just and proper cause, and Article 12 requires arbitration of all unjust discharge claims. Because the plaintiffs could submit to arbitration a claim for unjust dismissal, and then sue under § 301, the defendants maintain that there exists a federal claim substantially identical to the plaintiff's state law "wrongful termination" claim. Thus, the defendants argue that the first prong of the Williams test is satisfied.
The court is not persuaded by this argument. The California courts have developed two separate and independent limitations on an employer's absolute right to terminate employees. The first limitation prohibits a discharge that "violates fundamental *1355 principles of public policy." Tameny v. Atlantic Richfield Co., 27 Cal.3d 167, 170, 164 Cal.Rptr. 839, 610 P.2d 1330 (1980). The second limitation is based upon an express or implied agreement "that the employment relationship will continue indefinitely, pending the occurrence of some event such as the employer's dissatisfaction with the employee's services or the existence of some `cause' for termination." Pugh v. See's Candies, 116 Cal.App.3d 311, 325, 171 Cal.Rptr. 917 (1981). In this case, the plaintiffs are clearly relying upon the first of these two limitations by alleging that their members were terminated in violation of California's statutory public policies. Although a claim for unjust dismissal under the collective bargaining agreement would provide an analogous and substitute federal claim if the plaintiffs were alleging termination without good cause under state law, it does not provide an analogous cause of action for their public policy claim. Section 301 simply does not provide any remedy for persons discharged in violation of California's statutory public policies, and the plaintiffs therefore have no substitute federal claim available to them. Thus, the first prong of the Williams test is not satisfied, and the court concludes that it lacks removal jurisdiction over the wrongful termination claim.[1]
2. The Remaining State Law Claims
The defendants argue that the remaining causes of action must be dismissed because they are all within the exclusive jurisdiction of the NLRB. According to the defendants, this court may take jurisdiction over a case removed from state court for the limited purpose of dismissing the case because it is preempted by the NLRA and exclusive jurisdiction lies with the NLRB. In support of this proposition, the defendants cite Williams v. Caterpillar Tractor Co., 786 F.2d 928 (9th Cir.), cert. granted, ___ U.S. ___, 107 S.Ct. 455, 93 L.Ed.2d 401 (1986). There, the Ninth Circuit stated in dictum:
The NLRA may constitute a fairly unique area of law where, at least in some cases, the determination of federal jurisdiction in the National Labor Relations Board (NLRB) employs the identical analysis required to determine whether a state law claim is preempted.... If the activity underlying a state law claim is "arguably subject" to regulation under sections 7 and 8 of the NLRA, 29 U.S.C. §§ 157, 158, the action is both preempted and falls within the exclusive jurisdiction of the NLRB.... A federal court may be able to take jurisdiction over a case removed from state court for the limited purpose of determining whether exclusive federal jurisdiction exists in the NLRB. Thus, the preemption analysis applied under the NLRB should be distinguished from the approach taken with regard to § 301 of the Labor Management Relations Act, although the two provisions may overlap on occasion.
Id. at 934 n. 3 (citations omitted; emphasis supplied).
The court is not persuaded by this reasoning. Removal jurisdiction is limited to those cases over which the district courts have original jurisdiction. See 28 U.S.C. § 1441(a). Under the removal statute, a federal court must remand to state court any case over which it would not have had original jurisdiction. See 28 U.S.C. § 1447(c). Furthermore, it is well established that "a case may not be removed to federal court on the basis of a federal defense, including the defense of pre-emption." Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 14, 103 S.Ct. 2841, 2848, 77 L.Ed.2d 420 (1983). The result advocated here is directly contrary to these basic principles of removal jurisdiction. Having removed the case to this court, the defendants now urge us to dismiss on the ground that both the federal *1356 and state courts lack original jurisdiction because the state law claims are preempted and exclusive jurisdiction lies with the NLRB. However, if this court itself lacks original jurisdiction, then it also has no jurisdiction to dismiss the case after removal, and the case must instead be remanded to state court under § 1447(c). See 1A Moore's Federal Practice, ¶ 0.169[1] at 680 (2d ed. 1985); see also id. ¶ 0.167[7.3] at 492-93 n. 4 (citing cases holding that remand rather than dismissal is appropriate where a case within the exclusive jurisdiction of the NLRB is removed from state to federal court). Thus, we reject the argument that a federal court may exercise removal jurisdiction for the sole purpose of finding that both the federal and state courts lack jurisdiction.
The Ninth Circuit has consistently recognized in its NLRA preemption removal cases that the existence of a superseding federal remedy is an absolute prerequisite to the exercise of removal jurisdiction, because otherwise a state law claim cannot properly be "recharacterized" as a federal cause of action over which a federal court would have had original jurisdiction.
If no federal right is violated by the acts the plaintiffs allege occurred, then no federal question is raised in the complaint and the federal courts are without jurisdiction. The preemption argument then focuses only on the proposition that the state cannot regulate the field, which is a defensive allegation.... Consequently, such an action must be remanded to state court.
Williams v. Caterpillar Tractor Co., 786 F.2d 928, 933 (9th Cir.1986), cert. granted, ___ U.S. ___, 107 S.Ct. 455, 93 L.Ed.2d 401 (1986). This reasoning applies equally to NLRA preemption removal cases, and it would therefore be improper to exercise removal jurisdiction without first determining that there exists a substitute federal claim under the NLRA. For this reason, the court holds that the same analysis applied in LMRA preemption removal cases must be applied in NLRA preemption removal cases. First, we must determine whether "it is apparent" that a "federal right is violated by the acts the plaintiffs allege occurred." If so, then we "must proceed to determine whether the state law cause of action is preempted." Id.[2]
Two threshold questions merit discussion before turning to the first of the Williams inquiries. First, we must determine whether the complaint itself must state a federal cause of action to satisfy the Williams test, or whether a court is permitted to look beyond the face of the complaint to ascertain whether a substitute federal remedy exists. Several panels of the Ninth Circuit have implied that a district court is limited in its analysis to the face of the complaint itself. See Williams, 786 F.2d at 933 (stating that the substitute federal claim must be "apparent from a review of the complaint"); Hunter v. United Van Lines, 746 F.2d 635, 643 (9th Cir. 1984) (same), cert. denied, 474 U.S. 863, 106 S.Ct. 180, 88 L.Ed.2d 150 (1985); Garibaldi v. Lucky Food Stores, 726 F.2d 1367, 1370 n. 5 (9th Cir.1984) (stating that the substitute federal claim must appear "on the face of the complaint"), cert. denied, 471 U.S. 1099, 105 S.Ct. 2319, 85 L.Ed.2d 839 (1985). However, another panel has convincingly rejected this result, holding that the "artful pleading doctrine would afford little protection if a plaintiff could avoid federal jurisdiction simply by leaving out material facts." Olguin v. Inspiration Consolidated Copper Co., 740 F.2d 1468, *1357 1473 (9th Cir.1984). For this reason, we also conclude that "the court is not bound to consider only the facts pleaded in the complaint but may look elsewhere to ascertain facts that would appear in a `well-pleaded' complaint." Id.
The second threshold question to be considered is the degree of certainty required to conclude that there exists a substitute federal remedy. In many cases, the existence of a substitute federal remedy will turn on the resolution of complex factual or legal issues that cannot easily be addressed in a motion to remand. This problem can be alleviated by permitting a district court to consider evidence beyond the face of the complaint, but the court must still be guided by some standard establishing the degree of certainty necessary to recharacterize a state law claim as federal. Although the Ninth Circuit has not addressed this issue directly, the language of several previous opinions is instructive in answering the question.
The Ninth Circuit has clearly indicated its view that the artful pleading doctrine is to be narrowly construed. In Williams, the court stated:
The "artful pleading" doctrine is a narrow exception to the ordinary rules of federal jurisdiction, applying only when "the particular conduct complained of [is] governed exclusively by federal law." Hunter, 746 F.2d at 640. This "doctrine is to be invoked only in exceptional circumstances as it raises difficult issues of state and federal relationships and often yields unsatisfactory results." Salveson v. Western States Bankcard Association, 731 F.2d 1423, 1427 (9th Cir.1984).
Williams, 786 F.2d at 931 n. 1. Furthermore, the Ninth Circuit has also intimated that the doctrine may only apply when the plaintiff has a fraudulent purpose. In Hunter, the court stated:
[The artful pleading doctrine may apply] only when the preemption issue and the question of whether a federal cause of action exists are both so clear cut as to call into question the plaintiff's good faith in asserting the state claim. Certainly, if there is some question as to whether a state claim has been preempted or whether a federal claim exists, a fraudulent purpose cannot be inferred from the fact that only a state claim was presented. When plaintiff can have a good faith belief that a state claim has not been preempted or that no federal claim exists, he cannot be said, by alleging a state claim to have manifested a fraudulent purpose to defeat removal.
Hunter, 746 F.2d at 644 n. 6.
This narrow construction of the artful pleading doctrine is necessary to preserve the long-accepted principle that a plaintiff is generally considered the master of his own complaint. When a plaintiff has both a state and federal cause of action available to him, he is usually entitled to assert only the state claim in state court. The artful pleading doctrine is a narrow exception to this rule designed to prevent the deliberate manipulation of an obvious federal claim to avoid federal court jurisdiction. Because a plaintiff should generally be entitled to assert only a state law claim even if a federal cause of action might also be available, the artful pleading doctrine must be narrowly confined to those situations in which it is patently clear that a federal claim is available. Thus, this court holds that the artful pleading doctrine may not be applied if it is fairly debatable whether there exists a substitute federal cause of action. Furthermore, the burden of proving the existence of a clearly applicable federal claim is on the party seeking to invoke the court's removal jurisdiction.
Applying these principles to this case, the court concludes that it is fairly debatable whether there exists a substitute federal cause of action for the plaintiffs' state law claims. The defendants contend that, for the first eight causes of action, there is an analogous federal claim available to the plaintiffs for failure to bargain in good faith in violation of sections 8(a)(5) and 8(d) of the NLRA. However, it is well established that the duty to bargain in good faith is limited to mandatory subjects of bargaining, which are defined in the Act as "wages, hours, and other terms and conditions of employment." 29 U.S.C. *1358 § 158(d). See NLRB v. Borg-Warner, 356 U.S. 342, 349, 78 S.Ct. 718, 722, 2 L.Ed.2d 823 (1958). In First National Maintenance Corp. v. NLRB, 452 U.S. 666, 101 S.Ct. 2573, 66 L.Ed.2d 318 (1981), the Supreme Court held that an employer's decision to shut down part of its business for economic reasons does not fall within the scope of the mandatory duty to bargain. See id. at 686, 101 S.Ct. at 2584. The Court held that decisions representing a "significant change" in operations were not subject to mandatory bargaining unless they were made for the purpose of replacing discharged employees or moving the operation elsewhere. See id. at 687-88, 101 S.Ct. at 2585-86. The Court also made clear that an employer does not subject itself to the mandatory bargaining duty simply by seeking labor cost concessions from a union before closing its operations. See id. at 682, 101 S.Ct. at 2582.
On the basis of the pleadings and declarations before the court, we find that the facts of this case are likely to place it squarely within the ambit of the decision in First National Maintenance. The decision to shut down the Newark facility was not made simply in order to replace discharged workers or to relocate the plant elsewhere. Although labor costs may have played some role in the plant closure, that in itself would not suffice to trigger the mandatory bargaining duty. See id. at 682, 101 S.Ct. at 2582; Otis Elevator Co., 269 N.L.R.B. No. 162, 115 L.R.R.M. 1281 (April 6, 1984) (plurality opinion). On this record, we conclude that the decision to shut down the Newark plant constituted a "significant change in operations," and that the defendants were therefore not obligated to bargain in good faith over the closure. Thus, it is far from clear that there exists a federal cause of action available to the plaintiffs under the NLRA, and it is not appropriate to invoke the artful pleading doctrine.[3] The court therefore finds that the case has been improvidently removed, and remands it to state court under 28 U.S.C. § 1447(c). Because we conclude that there exists no clearly applicable substitute federal claim, we need not decide whether the state law claims are preempted by the NLRA. See supra note 1.
CONCLUSION
The court grants the plaintiffs' motion to remand the case to state court, and denies the defendants' motion for dismissal. The court denies the plaintiffs' motion for costs because the defendants had a good faith basis in law for their removal petition and for the motion to dismiss.
IT IS SO ORDERED.
NOTES
[1] Having found that there exists no substitute federal cause of action for the plaintiff's claim of wrongful termination, we have no occasion to consider whether that claim is nonetheless preempted by the NLRA. The Ninth Circuit has made clear that this question is to be addressed "if, and only if" the district court finds that there is an analogous substitute federal claim. See Williams v. Caterpillar Tractor Co., 786 F.2d 928, 933 (9th Cir.1986) (emphasis supplied), cert. granted, ___ U.S. ___, 107 S.Ct. 455, 93 L.Ed.2d 401 (1986).
[2] As a practical matter, any NLRA preemption removal case that satisfies the first prong of the Williams test will also satisfy the second. A state law cause of action is preempted by the NLRA if the activity underlying the state law claim is "arguably subject" to regulation under the NLRA. See San Diego Building Trades Council v. Garmon, 359 U.S. 236, 245, 79 S.Ct. 773, 779, 3 L.Ed.2d 775 (1959). If a court determines that the first prong of the Williams test is satisfied because the NLRA provides an analagous substitute cause of action for the plaintiff's state law claims, then it would necessarily follow that the activity underlying the state law claims is also "arguably subject" to regulation under the NLRA. Thus, the defendants in this case are correct insofar as they argue that a court need only apply one of the two prongs of the Williams test in an NLRA preemption removal case, but they are incorrect in asserting that the prong to be applied is the second rather than the first.
[3] In UAW v. NLRB, 765 F.2d 175 (D.C.Cir.1985), the court faced an issue similar to that raised here. There, the court held that the employer had not violated § 8(d) by offering to exchange its right to relocate for midterm modifications of the contract, or by deciding to relocate when the union rejected the modification proposals. The court held that the employer had not violated § 8(d) by seeking wage concessions because it had not "required" the union to bargain, and because it had not implemented any unilateral changes in the collective bargaining agreement. The court also found that the management rights clause in the contract permitted the company to relocate its operations. See id. at 181-83. The contract at issue here also contains a similar management rights clause.
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590 F.2d 817
100 L.R.R.M. (BNA) 2097, 85 Lab.Cas. P 10,992
KUSTOM ELECTRONICS, INC., Petitioner,v.NATIONAL LABOR RELATIONS BOARD, Respondent.
No. 77-1567.
United States Court of Appeals,Tenth Circuit.
Argued Nov. 7, 1978.Decided Dec. 22, 1978.
Earl J. Engle of Stinson, Mag, Thomson, McEvers & Fizzell, Kansas City, Mo. (John M. Edgar of Stinson, Mag, Thomson, McEvers & Fizzell, Kansas City, Mo., on the brief), for petitioner.
Eric G. Moskowitz, N.L.R.B., Washington, D.C. (John S. Irving, Gen. Counsel, John E. Higgins, Jr., Deputy Gen. Counsel, Carl L. Taylor, Associate Gen. Counsel, and Elliott Moore, Deputy Associate Gen. Counsel, Washington, D.C., on the brief), for respondent.
Before HOLLOWAY, DOYLE and LOGAN, Circuit Judges.
WILLIAM E. DOYLE, Circuit Judge.
1
This is a review of an order of the National Labor Relations Board, which order was issued against the petitioner on July 21, 1977. Kustom Electronics, Inc. has filed a petition pursuant to § 10(f) of the National Labor Relations Act, as amended, 29 U.S.C. § 151 Et seq. Kustom seeks a judgment setting aside the order of the NLRB. The Board has cross-applied for enforcement of its order. The alleged unfair labor practices occurred in Chanute, Kansas, where Kustom manufactures sound amplifiers, police radar and digital communications equipment.
2
The finding of the Board was that the Company had violated § 8(a)(5) and (1) of the Act by its refusal to bargain with the Communications Workers of America, AFL-CIO, which the Board had certified as the exclusive bargaining representative of the Company's employees following the representation proceeding.
3
The activities leading to the hearing before the Board go back to December 9, 1974, at which time the Union filed a representation petition. Following this, a hearing was held on January 23, 1975, for the purpose of determining the appropriate unit for collective bargaining. One of the issues at the hearing was whether a group of employees who had been laid off by the Company on December 18 and December 20, 1974, were eligible to vote in the upcoming election. The decision of the Regional Director of the NLRB was that there be an election in a unit of production and maintenance employees of Kustom Electronics, Inc., which included the music, data communications and radar divisions. The Regional Director ruled that the employees laid off in December 1974 would not be eligible to vote in that election. The Union sought review by the Board of the ruling excluding the employees who had been laid off.
4
An unfair labor practice charge had been filed with the Board in which it was alleged that the Company's layoff was discriminatory and unlawful. The Regional Director dismissed the charged allegations, and the Union filed an appeal with the General Counsel. So the layoff matters were considered by the Board simultaneously with consideration by the General Counsel of the dismissal of the unlawful labor practices.
5
The Board issued an order directing that the laid off employees be permitted to vote. This was on May 22, 1975. On May 28, the General Counsel remanded the unfair labor practice proceeding to the Region for further investigation.
6
At the election, which was held on June 18, 75 votes were cast for representation by the Union; 68 were against. Forty-six of the ballots were challenged. These numbers were later changed following a hearing before Administrative Judge Nixon. The Union continued to prevail 103 to 79.
7
The Company filed objections to the conduct of the Union in connection with the election, alleging that the Union interfered with the election by (1) misrepresenting that the Company had violated the Act by laying off employees in December 1974, and by failing to give employees wage increases in April 1975, as it had in previous years; (2) misrepresenting that other employees under Union contract had recently received large wage increases; (3) by unfairly employing Board rulings as campaign propaganda; (4) by offering employees financial inducements for their Union support; and (5) by threatening employees with reprisals for failure to support the Union. The Company also objected to the Board's having remanded the unfair labor practice matter to the Region and to its having granted the laid off employees permission to vote, as well as the Board's permitting the same Board agent to both investigate the Union's unfair labor practice charges and to conduct the representation election.
8
In December 1975 and February 1976, hearings were held looking to determination by the Board of the challenges and objections of the Company. On May 24, 1976, the Hearing Officer issued his report and recommendations on the challenges and objections. He recommended that the objections be overruled in their entirety, that the challenges to eight ballots be sustained, that the other 39 challenges be overruled, and that the ballots be counted. The Company filed objections to the Hearing Officer's report. However, the Board on October 15, 1976, issued its decision which affirmed the Hearing Officer's rulings, findings and recommendations. The Board also ordered the Regional Director of Region 17 to open and count the challenged ballots overruled by the Hearing Officer and to issue a revised tally of ballots and an appropriate certification. It was this recount which showed the revised tally, which is mentioned above, namely 103 votes for representation by the Union, and 79 votes against representation. On October 29, 1976, the Union was certified as the exclusive bargaining representative of the Company's employees.
9
Thereafter, the Union made requests for information that it regarded as necessary to commence bargaining. By a letter of November 19, the Union advised petitioner, according to the Board's Order, that it was ready to commence bargaining and set a proposed date and place for a meeting. However, petitioner, by letter of November 24, refused to bargain with the Union on the grounds that it did not represent an "uncoerced majority of the Company's employees in any unit appropriate for collective bargaining." The further reason was that the Union was improperly certified. The Union then filed an unfair labor practice charge based upon this refusal to bargain.
10
As a result of the Company's rejecting the Union's request to bargain, the Union filed an unfair labor practice charge on December 2, 1976. The Regional Director issued a complaint. In its answer the Company admitted a refusal to bargain and also denied the request of the Union for certain information relative to the collective bargaining issue. The Company stood on its position that the certification was invalid. Following the Company's action standing on its position of refusing to bargain, the General Counsel filed a motion with the Board for summary judgment based on the proposition that there were no issues of fact which warranted a hearing. The proceeding was then transferred to a panel of three Board members together with a notice to show cause why the motion for summary judgment should not be granted. The Company again stated its position challenging the validity of the election and the validity of the certification.
11
The General Counsel's complaint alleged that Kustom had engaged in unfair labor practices in violation of § 8(a)(5) and (1) and § 2(6) and (7) of the Act.
12
The complaint alleged in substance that on October 29, 1976, following a Board election, the Union was duly certified as the exclusive bargaining representative of Kustom employees in the appropriate unit, but that the petitioner Kustom had refused and continued to refuse to bargain collectively and to furnish certain information, notwithstanding a request by the Union. Petitioner filed an answer to the complaint admitting part of it and denying part of it.
13
As an affirmative defense, petitioner alleged that the Board's certification of the Union was invalid for the reason that it was based on a revised tally of ballots including the ballots of persons not entitled to vote because their employment had been terminated on December 20, 1974, six months prior to the election. A further defense was that about 62 percent of the employees in the unit had been hired since the election so that the majority status is now in question; that, therefore, the petitioner "has no duty to bargain with the Union."
14
The Board entered the opinion that is here at issue. The Board noted that the petitioner argued that the laid off employees, found to have a reasonable expectancy of recall by the Board, were ineligible to vote because the layoff was in fact permanent. This position of petitioner was rejected by the Board because of its previous adoption of the Hearing Officer's report to the contrary. The opinion of the Board points out that the test for determining expectancy of recall is the situation as it existed at the time of the election rather than subsequent developments.
15
The opinion pointed out that in the absence of newly discovered evidence or previously unavailable evidence or special circumstances, a respondent in the proceeding alleging a violation of § 8(a)(5) may not relitigate issues which were or could have been litigated in a prior representation proceeding.
16
Further, no merit was determined to exist as to the petitioner's contention that because 62 percent of its work force was newly hired there existed reasonable grounds to doubt the Union's majority status, for the reason that the obligation to bargain extends one year from the date of the certification and employee turnover does not constitute unusual circumstances within the meaning of Brooks v. NLRB, 348 U.S. 96, 75 S.Ct. 176, 99 L.Ed. 125 (1954). It therefore denied a hearing on employee turnover and rejected petitioner's contention that it could lawfully refuse to bargain on the basis of employee turnover.
17
The conclusion of the Board was that on June 18, 1975, a majority of the employees of petitioner in a bargaining unit designated the Union as their representative for the purpose of collective bargaining with the petitioner. As a result, the Union was certified as a collective bargaining representative on October 29, 1976. The Union has sought to bargain collectively, but petitioner has refused to do so.
18
The Board ordered the Company to cease and desist from refusing to bargain collectively, and to cease and desist its refusal to furnish the Union with information relevant and necessary for the collective bargaining, interfering with, restraining, and coercing, employees in the exercise of rights guaranteed them under § 7 of the Act. The Board also ordered that it proceed to bargain with the Union regarding rates of pay, wages, hours and other terms and conditions of employment. The initial period of certification was set on the date petitioner commenced to bargain in good faith with the Union as the recognized bargaining representative in the appropriate unit.
19
Numerous points are advanced by the Company in support of its demand that the Board's order finding that the petitioner engaged in unfair labor practice by refusing to bargain with the Union was in error and should be vacated. Many of these points are factual and hence are inappropriate, since we are unable to reevaluate the evidence where, as here, there exists a conflict and the Board has chosen a version of the evidence with which the Company disagrees, but which is adequately supported by evidence.
20
The underlying question is whether the Board erred in finding and concluding that the employees who were laid off on December 20, 1974, were entitled to vote in the June 18, 1975, election, for if all of these votes were thrown out, the certification would be invalid as would be the Board's order requiring the Company to bargain collectively.
21
There are other subsidiary issues, but these appear to be more in the nature of window dressing than contentions capable of causing the proceedings to be set aside. Much complaint is made about the timing of Board rulings in relationship to the election. Also, one threat is emphasized, and it is generally contended that the Union interfered with the election by disseminating slanderous, false and inaccurate information concerning the permanent layoff of employees on December 20, 1974. All of these issues are very carefully held up to the light, so to speak, by the Trial Examiner, who determined that the matters lacked merit.
22
Our conclusion is that the Trial Examiner and, in turn, the Board were correct and that the Board's Order is entitled to be enforced.
I.
23
The Company admits that the proper test for determining the right to vote under circumstances such as these is whether the employees who had been laid off had at the time of the election a reasonable expectation of reemployment within a reasonable time in the future. The rationale for this is that where a laid off employee has a reasonable expectation that he will be called back when business picks up, he has a bona fide interest in the conditions which will obtain when he returns. N. L. R. B. v. Hondo Drilling Company, 428 F.2d 943, 946 (5th Cir. 1970); N. L. R. B. v. Jesse Jones Sausage Co., 309 F.2d 664, 666 (4th Cir. 1962); Marlin-Rockwell Corp. v. N. L. R. B., 116 F.2d 586, 588 (2d Cir.), Cert. denied, 313 U.S. 594, 61 S.Ct. 1116, 85 L.Ed. 1548 (1941). See N. L. R. B. v. C. H. Sprague & Son Co., 428 F.2d 938, 940 (1st Cir. 1970).
24
The question whether the employees here had a reasonable expectation at the time of the election that they would be reemployed was one of fact and there was adequate evidence to support the Board's conclusion on this. A number of the employees who were laid off were shown to have returned in the spring of 1975. Some of these continue to be challenged by the Company, but there could be no question that they had a reasonable expectation of continued employment. There was also evidence that the Company's policy was to recall laid off employees and then put them to work in other divisions. Furthermore, at the time in question, although the Company's financial condition had been poor it showed promise, which could lead the employees involved to believe that they were likely to be called back. The Company argues that employees were given to understand at the time of the layoff that it was permanent. This is not conclusive because it is the condition at the time of the election that counts. N. L. R. B. v. Jesse Jones Sausage Co., supra, at 666.
25
There is one other fact that is worthy of mention and that is that notice to some of the employees was that the layoff would be temporary. Later they were notified that they should consider it to be permanent. Those who were laid off on December 20 did not receive individual notices that it would be permanent. There was a bulletin board letter posted. Also, some of the supervisors advised the employees that it would be permanent, but evidence was unclear whether all of them made the announcement. One employee said that she was told that it was to be temporary.
26
It cannot be said that the General Counsel's dismissal of the Union's charge of unfair labor practice growing out of the December layoff is legally inconsistent with the Board's position that there was a reasonable expectation of recall. The ruling that the December layoff was not illegal did not Ipso facto establish that the employees could not anticipate reasonably that they would be recalled in the face of the various evidence as to the Company's policy to recall people laid off as opposed to hiring new people. The efforts of the Company therefore to elevate this issue to one of law rather than fact cannot be accepted. The issue was one of fact which was tried and resolved against the Company.
II.
27
The election was, of course, under the supervision of the Board and it had a measure of discretion in the manner in which it conducted the election. There has been no showing that there was an abuse of discretion in this respect. One objection was that the Union misrepresented that the Company had violated the Act (NLRA) by laying off a number of employees. The Hearing Officer considered all of these objections and recommended that they be overruled. It is said that there was misrepresentation as to the Company violating the Act by laying off the employees, failing to give employees wage rate increases given in prior years and unfairly employing Board rulings as campaign propaganda, and making threats of reprisals for failure to support the Union.
28
It does not appear that the Company has satisfied its burden of proof as to the substantiality of these claims and objections. The one threat that was made was not related in time to the election and was not a direct threat. As to the misrepresentations and unfair campaign propaganda, a good deal of it would appear to be rhetoric and basically insubstantial. In any event, we cannot say that it is of such magnitude that this court can regard it and weigh it so as to upset the judgment of the Board.
29
The threat to the employee, one Ruth Daniel, was during a discussion Ms. Daniel had with Terry Hague and two other employees regarding the Union. She remarked that she would not be affected by any strike since she could cross the picket line and go to work. Hague responded, "No you would not because you would be stopped." She asked him what he meant and he said, "Your head would be bashed in if nothing else." This statement by Hague was his own remark and was in the course of a conversation, and the Board was free to decide that Daniel was not coerced by the statement.
III.
30
Complaint is made about the Union compensating witnesses who appeared at the representation hearing for their loss of time. It is said that the payments were unlawful. The Board did not consider these payments to be anything more than remuneration for loss of time and hence they did not invalidate the election. The same was true of workers who were compensated on an hourly basis for time spent in aiding the Union in its campaign. Sometimes the payments exceeded somewhat the payments they received from the Company. The Board did not believe that the payments were of such a nature that they in themselves established that the employees were influenced because of it.
31
We consider the contention that the Board erred in not sustaining the Company's objections to the manner of handling the election, and it does not appear that there was any substantial impropriety in this area. It is also argued by the Company that the cumulative effect of all of their objections should constitute a basis for invalidating the election (even though no single one of the objections is sufficient). It does not appear that the Company's objections considered as a whole carry sufficient impact to justify the appellate court's ruling that the election was invalid.
32
Our conclusion is, from a study of the contentions and consideration of the evidence which was presented, that the issues generally are factual in nature, and it does not appear that there was an abuse of discretion by the Board in its ruling.
33
Accordingly, there being nothing that has been called to our attention to justify setting aside the Findings, Conclusions and Orders of the Board, it is ordered that the ruling of the Board be approved and that its Orders be enforced.
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386 S.E.2d 72 (1989)
96 N.C. App. 506
STATE of North Carolina
v.
Ernest John MARINO.
No. 8912SC743.
Court of Appeals of North Carolina.
December 5, 1989.
*73 Atty. Gen. Lacy H. Thornburg by Asst. Atty. Gen. Teresa L. White, Raleigh, for the State.
Appellate Defender Malcolm Ray Hunter, Jr. by Asst. Appellate Defender Teresa A. McHugh, Raleigh, for defendant-appellant.
WELLS, Judge.
At trial while defendant's mother was testifying for the defense, defendant engaged in an intemperate and profane outburst. During the defendant's misconduct, the trial court excused the jury, but defendant's misconduct continued briefly. Following a bench conference, defendant moved for a mistrial, asserting his own misconduct as the basis for his motion. The trial court denied his motion.
Defendant's first assignment of error is to the denial of his motion for a mistrial. The decision whether or not to grant a mistrial is within the sound discretion of the trial judge. State v. Calloway, 305 N.C. 747, 291 S.E.2d 622 (1982). A mistrial is appropriate only when there are such serious improprieties as to make it impossible for a fair and impartial verdict to be rendered. Id.
Defendant argues that the trial court's ruling was based upon an erroneous recollection of the facts in that the jurors were present and did hear at least some of the profane outburst. The record, however, shows that the court stated it would probably deny the motion even if the jurors were present and heard the entire outburst.
We cannot say that the court abused its discretion in denying the motion. If defendant was prejudiced in the eyes of the jury by his own misconduct, he cannot be heard to complain. In addition, the evidence of defendant's guilt was overwhelming and it is unlikely that the outburst prevented him from receiving a fair and impartial verdict. State v. Blackstock, 314 N.C. 232, 333 S.E.2d 245 (1985).
Defendant also contends that the court erred in failing to find as a statutory mitigating factor that defendant was suffering from a mental or physical condition that was insufficient to constitute a defense but which significantly reduced his culpability for the offense. He argues the evidence was uncontradicted that he had a drug habit requiring him to steal in order to support the habit and that he suffered from endocarditis. Although the evidence may have shown that defendant did have these conditions, no evidence was presented to show that his culpability for the offenses was reduced by these conditions. The court therefore properly refused to make the finding. State v. Arnette, 85 N.C.App. 492, 355 S.E.2d 498 (1987); State v. Grier, 70 N.C.App. 40, 318 S.E.2d 889 (1984), cert. denied, 318 N.C. 698, 350 S.E.2d 860 (1986).
On the errors assigned we find
No error.
PARKER and GREENE, JJ., concur.
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460 So.2d 181 (1984)
James R. WEAVER
v.
Alice Bice WEAVER.
Civ. 4203.
Court of Civil Appeals of Alabama.
July 11, 1984.
Rehearing Denied August 15, 1984.
Certiorari Denied November 30, 1984.
*182 Chris S. Christ, Birmingham, for appellant.
Billy L. Church of Church, Trussell & Robinson, Pell City, for appellee.
Alabama Supreme Court 83-1323.
EDWARD N. SCRUGGS, Retired Circuit Judge.
This is a divorce case. The only issue on this appeal concerns the failure of the trial court to award to the husband any interest in the home used by the parties.
Under the attendant presumptions which must be accorded the trial court's decision, the following is pertinently revealed upon that issue.
The parties married each other the first time in 1976 and were divorced in August 1980. The wife was awarded their Apple Wood home. She was ordered to pay $10,000 to the husband for his equity in it. That payment has not been made. The husband conveyed the house to her by quitclaim deed. They resumed cohabitation in November 1980. Everyone has treated the resumption of their relationship as constituting a remarriage. They separated in January 1983. No children resulted from either of their marriages.
In 1981, the wife traded the Apple Wood house by using it as a $20,000 down payment upon a home in Springville which had a total purchase price of $75,000. The closing costs of $1,800 were paid by the wife. Title to the Springville property was taken only in the wife's name, and she is solely responsible for the note and mortgage, upon which there is a present balance of $53,800. She has made all of the monthly payments of $578 upon that mortgage except that the husband paid for one-half of that monthly expense from November 1981 through the year 1982. During part of their second marriage he monetarily contributed towards some of the household expenses and improvements.
The husband had a poor credit rating and could not borrow from lending institutions because he had bankrupted in 1972. The wife executed a note to enable the husband to purchase a used 1977 Ford pickup truck which has a present balance due against it of $506. Additionally, the husband desired to buy a boat, and the wife borrowed the funds for its purchase for him and, upon default, she paid the balance due upon it of about $5,600. Since their second marriage, the wife made twenty-four monthly payments of $225 each on behalf of the husband which are required by court judgments for the support of his children by a former marriage.
The wife was the primary provider of money for the family during some of their first marriage and during all of their second marriage. She has worked for the same employer since the 1960's and presently has an annual salary of $33,400. On the other hand, the husband's employment has been sporadic at times with multiple job changes. In 1981, the husband contributed between twenty-five and thirty percent of the income of the family; however, that increased in 1982 when he earned almost $24,000. The husband had three different employers during their second marriage and was unemployed from January 1983 until their divorce in September 1983. Husband disputes portions of this summary of the evidence.
After an ore tenus trial, the circuit court divorced the parties for incompatibility and awarded to the husband a 1977 Toyota automobile, the 1977 Ford pickup truck *183 (with the husband to pay the balance of the debt against it), the pleasure boat, and various items of household furniture, appliances and accessories. The husband was divested of any right, title, claims or interest in and to the wife's real estate. The wife received the remainder of the personal property which largely consisted of her automobile and household items. The husband appealed.
While a division of the property of the parties in a divorce case must be equitable according to the circumstances of the case, it need not be equal. Much discretion is granted to a trial court in dividing the property. Where the trial court presides over an ore tenus evidentiary divorce trial and an appeal is perfected from a final judgment, we are not allowed to change the trial court's divisions of the property of the parties unless it was so unsupported by the evidence as to be clearly wrong. Williams v. Williams, 445 So.2d 570 (Ala.Civ.App.1984); Hale v. Hale, 439 So.2d 160 (Ala.Civ.App. 1983); Taylor v. Taylor, 434 So.2d 269 (Ala.Civ.App.1983).
We have reviewed the entire record and we have studied the briefs of concerned counsel. We find no abuse of discretion by the trial court upon the issue in question. After considering the relative income and employment record of the parties, the awards of property which were made to each of the parties, the fact that the wife paid the entire financed purchase price of around $5,600 for the boat which was granted to the husband, and the payments of the support for the husband's children which were made by the wife in the amount of $5,400, it appears that an equitable property division was effected by the final judgment. There was much credible evidence which upheld the trial court's decision. It was neither unjust nor palpably erroneous for the trial court to fail to award to the husband either an interest in the Springville property or money from the wife in lieu thereof. The judgment of the trial court is affirmed.
The foregoing opinion was prepared by Retired Circuit Judge EDWARD N. SCRUGGS while serving on active duty status as a judge of this court under the provisions of § 12-18-10(e) of the Code of Alabama of 1975 and this opinion is hereby adopted as that of the court.
AFFIRMED.
All the Judges concur.
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Filed 12/3/19
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION SEVEN
B297354
In re
(Los Angeles County
Super. Ct. No. TA039953)
WILLIAM MILTON,
on Habeas Corpus.
ORIGINAL PROCEEDINGS on petition for writ of habeas
corpus. Petition denied.
Brad Kaiserman, under appointment by the Court of
Appeal, for Petitioner.
Xavier Becerra, Attorney General, Gerald A. Engler, Chief
Assistant Attorney General, Lance E. Winters, Senior Assistant
Attorney General, Michael C. Keller, Acting Supervising Deputy
Attorney General and Eric J. Kohm, Deputy Attorney General for
Respondent.
INTRODUCTION
In 1999 a California jury convicted William Milton of
second degree robbery. In a bifurcated proceeding, Milton
admitted he had two prior felony convictions in Illinois. The
court ruled the out-of-state convictions qualified as serious
felonies for purposes of the three strikes law (Pen. Code, §§ 667,
subds. (b)-(j), 1170.12).1 Milton appealed, this court affirmed, and
the Supreme Court denied review.
Eighteen years after his conviction, Milton filed this
petition for a writ of habeas corpus, contending he is entitled to
resentencing under the California Supreme Court’s decision in
People v. Gallardo (2017) 4 Cal.5th 120 (Gallardo), which held a
court considering whether to impose a sentence enhancement
based on a prior conviction may not make factual findings about
the defendant’s conduct to impose the enhancement. Because
Gallardo does not apply retroactively to Milton, whose conviction
became final long ago, we deny the petition.
FACTUAL AND PROCEDURAL BACKGROUND
A. Milton Is Convicted of Simple Robbery and Armed
Robbery in Illinois
Years before a jury in California convicted Milton of the
robbery offense that gives rise to this petition, Milton was
convicted of two crimes, simple robbery and armed robbery, in
Illinois. The prosecution in the Illinois action alleged in an
1 Statutory references are to the Penal Code.
2
information that on February 2, 1987 Milton committed simple
robbery by taking a wallet and $337 from his victim “by
threatening the imminent use of force.” Underneath this
allegation in the information, a handwritten note stated, “Class
II. [The victim] left [the market] after cashing his check.
Stopped. Money demanded. [Defendant] had a gun. $338.
[Defendant] admitted to Wkgn PD he took money.” The Illinois
prosecution also alleged that on February 9, 1987 Milton
committed armed robbery by taking $40 from his victim, “while
ar[med] with a dangerous weapon, a gun . . . by threatening the
imminent use of force.”
Milton pleaded guilty to the simple robbery charge, and an
Illinois jury found Milton guilty of the armed robbery charge.
The Illinois court held a combined sentencing hearing for the two
convictions. For the armed robbery conviction, the Illinois
prosecutor recounted the testimony of the victim as follows: “Mr.
Milton got out of the car, pointed a gun at [the victim], and
threatened him, forced him into the car where he was robbed of
his goods.” The court stated to Milton, “You used a gun . . . . You
stopped the victim . . . . You forced this individual into the
automobile.” For the simple robbery conviction, the Illinois
prosecutor stated Milton approached the victim “with a weapon,
threaten[ed] him, and . . . [the victim] lost his entire paycheck . . .
to Mr. Milton.” The Illinois court stated it had received
“stipulated facts” for the case, which “indicated that the
victim . . . left the . . . [market] after cashing his check. He was
stopped. Money was demanded from the victim by . . . Milton . . .
who possessed a handgun. And the sum of three hundred thirty-
eight dollars was taken from the victim . . . .”
3
Before the Illinois court pronounced sentence, the court
reiterated Milton’s use of a firearm: “In each of the two
respective offenses you deliberately held a gun—a loaded gun—
upon an individual. . . . I’m going to tell you that he who
participates in an offense of violence against another with a gun
is going to be punished. And the sentence I am going to give is
for the purpose of punishment.”
B. Milton Is Convicted of Robbery in California
On September 6, 1998 Milton committed another robbery,
this time in California. Milton stopped a teenager on a street in
Los Angeles at night and demanded money, “behaved as if he was
armed with a weapon,” and took money and a new pair of jeans.
The victim identified Milton as the robber, and a police officer
testified Milton admitted to the robbery. The jury found Milton
guilty of second degree robbery. (People v. Milton (May 10, 2000,
B131757) [nonpub. opn.].)
C. The Trial Court Sentences Milton in California
In a bifurcated proceeding Milton admitted he suffered two
prior felony convictions in Illinois, one for armed robbery and one
for simple robbery. Milton admitted that the armed robbery
conviction was a serious felony under section 667, subdivision
(a)(1), and that it qualified as a “five-year prior.” Milton denied
the allegation the simple robbery conviction was a serious or
violent felony that made it a “strike.” The California prosecutor
acknowledged that the Illinois simple robbery conviction was not
a serious or violent felony under the three strikes law because
robbery under Illinois law, unlike robbery under California law,
did not require the specific intent to permanently deprive the
4
person of the property. The California prosecutor argued,
however, that certified documents from the Illinois court
“indicate that [Milton] used a gun during the [simple] robbery”
and that “[t]his information, therefore, provides this Court with
the ability to determine that this particular conviction is a
strike.”
Counsel for Milton argued the Illinois court documents, at
best, showed Milton “possessed” a gun, and nothing in the record
showed he “actually personally used” a gun. The prosecutor
argued California law allowed the trial court “to look behind the
record” to determine whether Milton used a gun in the simple
robbery. The trial court ruled, “I see nothing wrong with
going . . . beyond the court record . . . to determine what really
happened. And in doing that, I am satisfied that the defendant
used a gun in both . . . these prior robberies. And . . . I am
satisfied that they’re both strikes.” The trial court imposed a
term of 25 years to life, plus five years under section 667,
subdivision (a)(1).
D. Milton Appeals and Files Habeas Petitions
Milton appealed his judgment of conviction. He contended,
among other things, the trial court erred in finding his Illinois
felony conviction for simple robbery qualified as a serious or
violent felony under the three strikes law.2 This court affirmed
the judgment, and the Supreme Court denied review. (People v.
2 In his direct appeal, Milton did not challenge the trial
court’s finding the Illinois armed robbery conviction was a serious
or violent felony under the three strikes law.
5
Milton, supra, B131757, review denied, July 19, 2000, S089153.)
Milton subsequently filed five petitions for a writ of habeas
corpus in this court, each of which was denied.
On January 11, 2016 Milton filed a petition in the
California Supreme Court (S231762), contending the trial court
erred in finding his two Illinois convictions were serious felonies
under the three strikes law. On March 23, 2016 the Supreme
Court denied the petition “without prejudice to any relief to
which [Milton] might be entitled after this court decides People v.
Gallardo, S231260,” a case then pending in the Supreme Court.
E. Milton Files This Petition
On December 29, 2017, following the Supreme Court’s
decision in Gallardo, Milton filed this petition, arguing his
“Illinois priors cannot be used as strikes.”3 The Supreme Court
issued an order directing the Department of Corrections and
Rehabilitation to show cause, returnable in this court, “why
[Milton] is not entitled to relief pursuant to People v. Gallardo
(2017) 4 Cal.5th 120 . . . , and why Gallardo should not apply
retroactively on habeas corpus to final judgments of conviction.”
3 Milton admitted the armed robbery conviction was a
serious felony under section 667, subdivision (a)(1), and he does
not argue in his petition the sentencing court erred in imposing a
five-year enhancement under that statute.
6
DISCUSSION
A. California Sentencing Laws for Serious Felonies
Under sections 667, subdivisions (b)-(j), and 1170.12, a
“‘serious felony’ conviction is . . . a prior strike for purposes of the
Three Strikes law . . . .”4 (Gallardo, supra, 4 Cal.5th at
p. 125.) Section 667, subdivision (d)(2), provides that a prior
conviction in another jurisdiction “shall constitute a prior
conviction of a particular serious and/or violent felony if the prior
conviction in the other jurisdiction is for an offense that includes
all of the elements of a particular violent felony . . . . or serious
felony as defined in subdivision (c) of Section 1192.7.” Section
1192.7, subdivision (c)(8), provides that “‘serious felony’” includes
“any felony in which the defendant personally uses a firearm.”
(See People v. Briceno (2004) 34 Cal.4th 451, 463 [“[s]ection
1192.7, subdivision (c)(8) makes any felony not otherwise
enumerated in section 1192.7, subdivision (c) a serious felony if
the defendant personally uses a firearm”].)
Milton’s Illinois convictions for simple robbery and armed
robbery were not serious felony convictions within the meaning of
the three strikes law under section 667, subdivision (d)(2).
Section 211 states, “Robbery is the felonious taking of personal
property in the possession of another, from his person or
immediate presence, and against his will, accomplished by means
of force or fear.” An essential element of the California crime of
robbery is “the intent to permanently deprive the person of the
4 The three strikes law “articulates an alternative sentencing
scheme for the current offense rather than an enhancement.”
(People v. Superior Court (Romero) (1996) 13 Cal.4th 497, 527;
accord, In re Edwards (2018) 26 Cal.App.5th 1181, 1187.)
7
property.” (People v. Jackson (2016) 1 Cal.5th 269, 343.) The
definitions of robbery and armed robbery in Illinois do not include
this specific intent element; robbery and armed robbery are
general intent crimes in Illinois. (People v. Jamison (2001) 197
Ill.2d 135, 161; People v. Lee (1998) 294 Ill.App.3d 738, 743.) But
if Milton personally used a firearm in the commission of the
Illinois felonies, those prior convictions would be convictions for
serious felonies under section 1192.7, subdivision (c)(8).5 (See
People v. Le (2015) 61 Cal.4th 416, 425 [“subdivision (c)(8) of
section 1192.7 . . . applies to ‘any felony in which the defendant
personally uses a firearm’”].)
B. California Sentencing Law Before Gallardo
When the trial court sentenced Milton in 1999, California
law permitted trial courts to examine “the entire record of the
conviction to determine the substance of the prior foreign
conviction.” (People v. Guerrero (1988) 44 Cal.3d 343, 355; see
People v. Woodell (1998) 17 Cal.4th 448, 453.) In 2000 the United
States Supreme Court decided Apprendi v. New Jersey (2000) 530
U.S. 466 [120 S.Ct. 2348] (Apprendi), which held a jury must
make the factual determination whether the defendant was
subject to a state hate crime law that provided for enhanced
penalties if the defendant committed certain offenses “with the
purpose to intimidate an individual . . . because of race, color,
gender, handicap, religion, sexual orientation or ethnicity.” (Id.
at pp. 469-470, 490.) The United States Supreme Court held
that, under the Sixth Amendment and the Due Process Clause of
5 For the offense of armed robbery, Illinois does not require
the jury to find the defendant used a gun. (See Ill.Rev.Stats., ch.
38, § 18-2(a).)
8
the Fourteenth Amendment to the United States Constitution,
“[o]ther than the fact of a prior conviction, any fact that increases
the penalty for a crime beyond the prescribed statutory
maximum must be submitted to a jury, and proved beyond a
reasonable doubt.” (Id. at pp. 477, 490.)
California courts initially held Apprendi did not apply to a
trial court’s factfinding in connection with determining whether a
defendant’s prior convictions subjected the defendant to increased
penalties. (See, e.g., People v. Thomas (2001) 91 Cal.App.4th 212,
222 [defendant has no federal constitutional right to a jury trial
on factual issues related to “recidivism”].) In 2006 the California
Supreme Court decided People v. McGee (2006) 38 Cal.4th 682
(McGee), where the trial court examined the record of two prior
robbery convictions the defendant had received in Nevada to
determine if those convictions were serious felonies under section
667, subdivision (a)(1), and the three strikes law. (Id. at p. 688.)6
The trial court in McGee reviewed a preliminary hearing
transcript and other court records in each of the Nevada
convictions. The trial court ruled the prior convictions satisfied
the elements of robbery under California law and, therefore,
qualified as serious felonies. (Id. at p. 690.) The California
Supreme Court in McGee held the trial court’s inquiry did not
violate Apprendi because “Apprendi was confined to the elements
of the charged offense—not, as here, to the adjudication of aspects
of the defendant’s criminal past.” (Id. at p. 697.)
6 Nevada law defined robbery more broadly than California
law because Nevada law required only general criminal intent,
and as stated California law required the specific intent to
permanently deprive another person of property. (McGee, supra,
38 Cal.4th at p. 688.)
9
C. Gallardo
In Gallardo a jury convicted the defendant of robbery and
other offenses, and the trial court increased the defendant’s
sentence “on the ground that defendant had previously been
convicted of a ‘serious felony’ under . . . section 667, subdivision
(a), that was also a strike for purposes of the ‘Three Strikes’ law.”
(Gallardo, supra, 4 Cal.5th at pp. 123, 126.) The trial court found
the defendant’s prior conviction for assault with a deadly weapon
or with force likely to produce great bodily injury under section
245, subdivision (a)(1), was a serious felony conviction, even
though the statutory definition for the crime “swe[pt] more
broadly than the definition of ‘serious felony.’”7 (Gallardo, at
p. 123.) The trial court reviewed the preliminary hearing
transcript from the underlying prior conviction and concluded the
defendant “had, in fact, been convicted of ‘assault with a deadly
weapon; to wit, knife.’” (Id. at p. 126.)
7 “An assault conviction qualifies as a serious felony if the
assault was committed with a deadly weapon [citation], but not
otherwise.” (Gallardo, supra, 4 Cal.5th at p. 123.) “[S]ection 245,
subdivision (a), has since been amended to separate the
prohibitions against assault ‘with a deadly weapon’ and assault
‘by any means of force likely to produce great bodily injury’ into
different subdivisions.” (Gallardo, at p. 125, fn. 1.) “The reason
for the change was to make it easier going forward to determine
whether a defendant’s prior convictions for aggravated assault
under section 245, subdivision (a), involved conduct subjecting
the defendant to certain recidivist provisions, because
enhancements such as the ‘Three Strikes’ law applied to prior
assault convictions only when those convictions involved the use
of a deadly weapon.” (In re C.D. (2017) 18 Cal.App.5th 1021,
1028.)
10
The California Supreme Court held the trial court’s factual
findings regarding the conduct underlying the defendant’s prior
conviction violated the defendant’s Sixth Amendment jury trial
right. (Gallardo, supra, 4 Cal.5th at p. 136.) Citing two post-
Apprendi decisions by the United States Supreme Court,
Descamps v. United States (2013) 570 U.S. 254 [133 S.Ct. 2276]
(Descamps) and Mathis v. United States (2016) ___ U.S. ___ [136
S.Ct. 2243] (Mathis), the California Supreme Court decided it
was “time to reconsider McGee.” (Gallardo, at p. 124.) The
California Supreme Court explained Descamps and Mathis made
“clear that when the criminal law imposes added punishment
based on findings about the facts underlying a defendant’s prior
conviction, ‘“[t]he Sixth Amendment contemplates that a jury—
not a sentencing court—will find such facts, unanimously and
beyond a reasonable doubt.”’” (Gallardo, at p. 124, citing
Descamps, at p. 269.) The California Supreme Court held a
“court considering whether to impose an increased sentence
based on a prior qualifying conviction may not determine the
‘nature or basis’ of the prior conviction based on its independent
conclusions about what facts or conduct ‘realistically’ supported
the conviction.” (Gallardo, at p. 136.) “[R]ather,” the California
Supreme Court held, “[t]he court’s role is . . . limited to
identifying those facts that were established by virtue of the
conviction itself.” (Ibid.) The California Supreme Court
disapproved McGee “insofar as it suggest[ed] that the trial court’s
factfinding was constitutionally permissible.” (Gallardo, at
p. 125.)
The People concede the trial court in this case erred in
relying on its review of the record of the proceedings in Milton’s
two Illinois felony cases to find Milton used a gun in the
11
commission of those felonies, a finding the trial court used to
increase Milton’s sentence under the three strikes law. The
record contained a transcript of the sentencing hearing, in which
the Illinois court referred to “stipulated facts” and stated Milton
used a gun in both robberies. These factual determinations,
which served as the basis for increasing Milton’s sentence,
violated Milton’s Sixth Amendment right to a jury trial. (See
Gallardo, supra, 4 Cal.5th at p. 136.) The issue in this petition is
whether Gallardo applies retroactively to Milton, whose appeal
became final years ago.8
D. Gallardo Does Not Apply Retroactively
1. Two Tests: One Federal, One State
The California “Supreme Court has not articulated a single
test to determine when and under what circumstances a decision
should be given retroactive effect to convictions that are final on
appeal.” (In re Hansen (2014) 227 Cal.App.4th 906, 916.) In
Teague v. Lane (1989) 489 U.S. 288, 307 [109 S.Ct. 1060] (Teague)
the United States Supreme Court established the test most
8 “It has long been the rule in federal and California courts
that a case is not final for purposes of determining the
retroactivity and application of a new decision addressing a
federal constitutional right until direct appeal is no longer
available in the state courts, and the time for seeking a writ of
certiorari has lapsed or a timely filed petition for that writ has
been denied.” (In re Richardson (2011) 196 Cal.App.4th 647,
664.) The California Supreme Court denied review of Milton’s
direct appeal on July 19, 2000. Therefore, Milton’s judgment of
conviction became final on October 19, 2000.
12
California courts apply when deciding whether a new rule
interpreting federal rights applies retroactively. (See, e.g., In re
Gomez (2009) 45 Cal.4th 650, 656 [applying Teague to decide
whether Cunningham v. California (2007) 549 U.S. 270 [127
S.Ct. 856] (Cunningham), which held a jury must find the
aggravating factors that make a defendant eligible for an upper-
term sentence, is retroactive]; In re Moore (2005) 133 Cal.App.4th
68, 77 [applying Teague to decide whether Crawford v.
Washington (2004) 541 U.S. 36 [124 S.Ct. 1354] (Crawford),
which held testimonial hearsay was inadmissible in the absence
of certain safeguards, is retroactive]; see also In re Ruedas (2018)
23 Cal.App.5th 777, 799 [“[a]lthough states are free to establish
their own rules for determining the retroactivity of judicial
opinions, California courts have generally hewed to the federal
standard”].)
A few California courts have applied the California state
law test for retroactivity stated in In re Johnson (1970) 3 Cal.3d
404 (Johnson), or have discussed both the federal and state tests,
to decide whether a state law decision interpreting federal rights
is retroactive. (See, e.g., In re Thomas (2018) 30 Cal.App.5th 744,
760-761 [“the three-factor balancing test articulated in Johnson
still governs whether we should apply [People v. Sanchez (2016)
63 Cal.4th 665 (Sanchez)] retroactively when a petitioner seeks
state habeas corpus review”]; In re Ruedas, supra, 23 Cal.App.5th
at pp. 793, 798 [using both the federal and state tests to decide
whether Sanchez is retroactive]; see also In re Gomez, supra, 45
Cal.4th at p. 655, fn. 3 [“[o]f course, we are ‘free to give greater
retroactive impact to a decision than the federal courts choose to
give’”].) Because Gallardo is a state law decision interpreting
federal constitutional rights, “out of an abundance of caution” (In
13
re Ruedas, at p. 799) we consider both the federal test under
Teague and the state test under Johnson.
2. Gallardo Is Not Retroactive Under Teague
“Under Teague, as a general matter, ‘new constitutional
rules of criminal procedure will not be applicable to those cases
which have become final before the new rules are announced.’
[Citation.] Teague and its progeny recognize two categories of
decisions that fall outside this general bar on retroactivity for
procedural rules. First, ‘[n]ew substantive rules generally apply
retroactively.’ [Citations.] Second, new ‘“watershed rules of
criminal procedure,”’ which are procedural rules ‘implicating the
fundamental fairness and accuracy of the criminal proceeding,’
will also have retroactive effect.” (Welch v. United States (2016)
___ U.S. ___, ___ [136 S.Ct. 1257, 1264] (Welch).) “The Teague
framework creates a balance between, first, the need for finality
in criminal cases, and second, the countervailing imperative to
ensure that criminal punishment is imposed only when
authorized by law. . . . If a new rule regulates only the
procedures for determining culpability, the Teague balance
generally tips in favor of finality. The chance of a more accurate
outcome under the new procedure normally does not justify the
cost of vacating a conviction whose only flaw is that its
procedures ‘conformed to then-existing constitutional standards.’”
(Id. at p. ___ [136 S.Ct. at p. 1266].)
a. Gallardo Established a New Rule Under
Federal Law
“In general, . . . a case announces a new rule when it breaks
new ground or imposes a new obligation on the States or the
14
Federal Government. . . . To put it differently, a case announces
a new rule if the result was not dictated by precedent existing at
the time the defendant’s conviction became final.” (Teague,
supra, 489 U.S at p. 301; see Welch, supra, 136 S.Ct. at p. 1264;
In re Gomez, supra, 45 Cal.4th at p. 655.) “A case is not dictated
by existing precedent if its outcome was ‘susceptible to debate
among reasonable minds.’ [Citation.] Therefore, ‘unless
reasonable jurists hearing petitioner’s claim at the time his
conviction became final “would have felt compelled by existing
precedent”’ to apply the rule in question, the rule will be
considered new and presumed not to apply on collateral review.”
(In re Ruedas, supra, 23 Cal.App.5th at p. 794.)
Milton argues Gallardo did not establish a new rule
because, at the time his conviction became final in October 2000,
the law—which Milton asserts included Taylor v. United States
(1990) 495 U.S. 575 [110 S.Ct. 2143] (Taylor) and Apprendi—
“dictated” the result in Gallardo. Neither case, however, had the
far-reaching effects Milton argues it had.
Taylor interpreted a federal statute that provided for
sentence enhancements if the defendant had three prior
convictions for specified types of offenses, including burglary.
(Taylor, supra, 495 U.S. at p. 578.) After examining the purpose
and legislative history of the statute, the United States Supreme
Court held the sentencing court could find the defendant received
a prior conviction for a burglary within the meaning of the
federal statute by looking “only to the fact of conviction and the
statutory definition of the prior offense” or “the charging paper
and jury instructions.” (Id. at pp. 601-602.) Taylor involved
statutory interpretation; it did not “dictate” the result in
Gallardo, which is based on Sixth Amendment principles.
15
As stated, in Apprendi the United States Supreme Court
held that all facts used to increase the defendant’s punishment
(other than the fact of a prior conviction) must be found by a jury.
But the Supreme Court also recognized an exception to this
general rule. (Apprendi, supra, 530 U.S. at pp. 488-490.) Two
years before Apprendi, the United States Supreme Court decided
in Almendarez-Torres v. United States (1998) 523 U.S. 224
(Almendarez-Torres) that, even though a jury did not make the
finding the defendant had three prior convictions, the trial court
could impose higher penalties without implicating the right to a
jury trial because “recidivism ‘does not relate to the commission
of the offense, but goes to the punishment only, and therefore . . .
may be subsequently decided.’” (Almendarez-Torres, at p. 244.)
The United States Supreme Court in Apprendi declined to
overrule Almendarez-Torres and instead distinguished it on “its
unique facts”: “[O]ur conclusion in Almendarez-Torres turned
heavily upon the fact that the additional sentence to which the
defendant was subject was ‘the prior commission of a serious
crime,’” a fact the defendant in that case did not contest.
(Apprendi, at pp. 488-490.) The United States Supreme Court
stated that recidivism was “‘a traditional, if not the most
traditional, basis for a sentencing court’s increasing an offender’s
sentence.’” (Id. at p. 488.)
Thus, Apprendi, while providing the foundation for
Gallardo, did not dictate the result in Gallardo, because Gallardo
concerned the right to have a jury conduct factfinding under a
sentencing statute aimed at recidivism. When the California
Supreme Court considered a case involving a recidivist statute in
McGee, it concluded the United States Supreme Court in
Apprendi “left state courts free to undertake the analysis . . . to
16
ascertain the facts underlying a prior conviction.” (McGee, supra,
38 Cal.4th at p. 705.) The California Supreme Court in Gallardo
acknowledged this area of the law was unsettled: “In the wake of
Apprendi, questions arose about the scope of the so-called
Almendarez-Torres exception to the general Sixth Amendment
rule forbidding judicial factfinding in criminal cases.” (Gallardo,
supra, 4 Cal.5th at p. 128.)
In re Gomez, cited by Milton, does not suggest a different
conclusion. In that case the California Supreme Court held
Cunningham, supra, 549 U.S. 270 did not constitute a new rule
for purposes of determining its retroactivity because its holding
was “dictated by Blakely [v. Washington (2004) 542 U.S. 296 [124
S.Ct. 2531] (Blakely)].” (In re Gomez, supra, 45 Cal.4th at p. 660.)
In Blakely the United States Supreme Court held a statutory
scheme that permitted the sentencing court to impose additional
penalties based solely on the court’s finding the defendant
committed a felony with “deliberate cruelty” violated the Sixth
Amendment right to a jury trial. (Blakely, at pp. 298, 305.) In
Cunningham the United States Supreme Court held a sentencing
law that “assigns to the trial judge . . . authority to find the facts
that expose a defendant to an elevated ‘upper term’ sentence”
violated the Sixth Amendment right to a jury trial.
(Cunningham, at p. 274.) The California Supreme Court in In re
Gomez explained that the Cunningham decision “did not extend
or modify the rule established in Blakely, but merely applied” the
rule to the California sentencing scheme. (In re Gomez, at
p. 658.)
In contrast, Gallardo did not merely apply the holding of
Apprendi to the recidivist sentencing scheme in California. To be
sure, the opinion in Gallardo discussed the Apprendi decision.
17
(See Gallardo, supra, 4 Cal.5th at p. 128.) But, as discussed, the
California Supreme Court drew heavily on Descamps and Mathis
in holding a jury must find the facts that support increased
punishment based on recidivism. (Id. at p. 134.) Indeed, the
California Supreme Court in Gallardo emphasized that it
benefited from “further explication by the high court” and that
the holding in Gallardo was “consistent with [the] principle” of
Descamps that judicial factfinding “does not extend ‘beyond the
recognition of a prior conviction.’” (Id. at p. 136.) Apprendi,
decided 13 years before the United States Supreme Court decided
Descamps and Mathis, did not “dictate” the holding in Gallardo.
Gallardo announced a “new rule” under Teague.
b. Gallardo Is a Procedural Rule
‘“A rule is substantive rather than procedural if it alters
the range of conduct or the class of persons that the law
punishes.’ [Citation.] . . . Procedural rules, by contrast, ‘regulate
only the manner of determining the defendant’s culpability.’
[Citation.] Such rules alter ‘the range of permissible methods for
determining whether a defendant’s conduct is punishable.’
[Citation.] ‘They do not produce a class of persons convicted of
conduct the law does not make criminal, but merely raise the
possibility that someone convicted with use of the invalidated
procedure might have been acquitted otherwise.’” (Welch, supra,
136 S.Ct. at pp. 1264-1265; see Schriro v. Summerlin (2004) 542
U.S. 348, 353 [124 S.Ct. 2519] (Schriro); In re Lopez (2016) 246
Cal.App.4th 350, 357.) “Because of this more speculative
connection to innocence, we give retroactive effect to only a small
set of ‘“watershed rules of criminal procedure” implicating the
18
fundamental fairness and accuracy of the criminal proceeding.’”
(Schriro, at p. 352.)
The holding of Gallardo, that the trial court’s role in
considering whether to impose an increased sentence is limited to
identifying facts established by the conviction (Gallardo, supra, 4
Cal.5th at p. 136), is a procedural rule because it prescribes the
manner of finding facts to increase the defendant’s sentence.
Before Gallardo, the trial court, as authorized by McGee, could
examine the entire record of conviction to determine the “nature
or basis” of the prior conviction based on its independent
conclusion. (McGee, supra, 38 Cal.4th at p. 706.) After Gallardo,
the trial court can only look at a subset of this record, namely,
facts that “the jury was necessarily required to find to render a
guilty verdict, or that the defendant admitted as the factual basis
for a guilty plea.” (Gallardo, at p. 136.) The Supreme Court in
Gallardo described the trial court’s error as one concerning the
“form” of judicial factfinding. (See ibid. [“the trial court engaged
in a form of factfinding that strayed beyond the bounds of the
Sixth Amendment”].) As discussed, a new rule that changes the
form or procedure of factfinding is procedural. (See Welch, supra,
136 S.Ct. at p. 1266 [a new rule “has a procedural function”
where “it alters only the procedures used to obtain the
conviction”]; see also In re Moore, supra, 133 Cal.App.4th at p. 75
[Crawford “announced a new rule of procedural constitutional
law” because before Crawford, Ohio v. Roberts (1980) 448 U.S. 56
[100 S.Ct. 2531] (Roberts) “provided the procedure for
determining whether the admission of hearsay statements
violated the confrontation clause”].)
19
Cases holding Apprendi and Blakely announced procedural
rules and do not have retroactive application are instructive.9
(See People v. Anderson (2009) 47 Cal.4th 92, 118 [“the United
States Supreme Court has made it clear that Apprendi, and cases
following it, did not alter state substantive law”]; People v. Amons
(2005) 125 Cal.App.4th 855, 865 (Amons) [Blakely “is a
procedural rule that affects only the manner of determining the
defendant’s punishment”]; United States v. Sanchez-Cervantes
(9th Cir. 2002) 282 F.3d 664, 668 [“Apprendi was a new rule of
criminal procedure”]; cf. Welch, supra, 136 S.Ct. at p. 1265
[Johnson v. United States (2015) ___ U.S. ___ [135 S.Ct. 2551],
which held a federal statutory sentence enhancement was
unconstitutionally vague, “changed the substantive reach” of a
sentencing statute, “had nothing to do with the range of
permissible methods a court might use to determine whether a
defendant should be sentenced,” and “did not, for example,
‘allocate decisionmaking authority’ between judge and jury”].)
The rules announced in Apprendi and Blakely protect the
defendant’s right to have a jury determine the facts to support an
increased sentence by changing the factfinder from judge to jury.
(See Apprendi, supra, 530 U.S. at p. 466; Blakely, supra, 542 U.S.
at p. 296.) Gallardo protects the same right in the context of a
recidivist statute by a slightly different method, limiting the role
of the sentencing court and the kind of materials the court can
consider. (See Gallardo, supra, 4 Cal.5th at p. 136.) Because
9 The Apprendi opinion described the issue before the United
States Supreme Court as procedural: “The substantive basis for
New Jersey’s enhancement is . . . not at issue; the adequacy of
New Jersey’s procedure is.” (Apprendi, supra, 530 U.S. at p. 475.)
20
Gallardo altered ‘“the range of permissible methods for
determining whether a defendant’s conduct is punishable’”
(Welch, supra, 136 S.Ct. at p. 1265), it is procedural.
The cases Milton cites to support his argument Gallardo
announced a substantive rule rather than a procedural rule are
distinguishable. In Montgomery v. Louisiana (2016) ___ U.S. ___
[136 S.Ct. 718] the United States Supreme Court decided that
Miller v. Alabama (2012) 567 U.S. 460 [132 S.Ct. 2455] (Miller),
which held a sentencing scheme mandating a sentence of life
without the possibility of parole for juveniles convicted of murder
violated the Eighth Amendment, applied retroactively. The
United States Supreme Court in Montgomery explained that
Miller changed a substantive rule of criminal law because,
“[b]efore Miller, every juvenile convicted of a homicide offense
could be sentenced to life without parole. After Miller, it will be
the rare juvenile offender who can receive that same sentence.”
(Montgomery, at p. 734.) Gallardo did not alter the substantive
reach of the California sentencing laws.
In People v. Trujeque (2015) 61 Cal.4th 227 the California
Supreme Court decided that Breed v. Jones (1975) 421 U.S. 519
(Breed), which held a state may not prosecute a juvenile for an
offense as an adult after the juvenile court has commenced
adjudicatory proceedings, applied retroactively. (Trujeque, at
p. 249.) The California Supreme Court in Trujeque explained the
rule in Breed was substantive because, “without the rule’s
retroactive application, a defendant would otherwise ‘face[ ] a
punishment that the law cannot impose upon him.’” (Trujeque, at
p. 251.) In contrast, Gallardo did not alter the scope or
applicability of section 1192.7, subdivision (c)(8), or the three
strikes law; it only limited the role of the trial court and the kind
21
of evidence the court can consider to determine if a defendant’s
prior felony conviction is a serious or violent felony conviction.
(See Gallardo, supra, 4 Cal.5th at p. 136.) Thus, if the
sentencing court, after examining the facts the Illinois jury
necessarily found in convicting Milton of armed robbery and any
admissions Milton made in pleading guilty to simple robbery,
determined Milton used a gun, the sentencing court could still
apply section 1192.7, subdivision (c)(8), to increase his sentence.
Unlike Trujeque, Gallardo did not remove Milton from the reach
of the applicable sentencing laws. Gallardo only changed the
manner in which the court could determine whether the prior
convictions subjected Milton to increased punishment.
c. Gallardo Is Not a Watershed Rule of
Criminal Procedure
“In order to qualify as watershed, a new rule must meet
two requirements. First, the rule must be necessary to prevent
‘an “‘impermissibly large risk’”’ of an inaccurate conviction.
[Citations.] Second, the rule must ‘alter our understanding of the
bedrock procedural elements essential to the fairness of a
proceeding.’” (Whorton v. Bockting (2007) 549 U.S. 406, 418 [127
S.Ct. 1173]; see ibid. [“‘[i]t is . . . not enough . . . to say that [the]
rule’ . . . ‘is directed toward the enhancement of reliability and
accuracy in some sense’”]; Schriro, supra, 542 U.S. at p. 352
[“[t]hat a new procedural rule is ‘fundamental’ in some abstract
sense is not enough; the rule must be one ‘without which the
likelihood of an accurate conviction is seriously diminished’”].)
Gallardo, though significant, was not a watershed rule of
criminal procedure because limiting the role of the trial court and
the scope of what the court may review and consider to impose an
22
increased sentence is not a rule ‘“without which the likelihood of
an accurate conviction is seriously diminished.’” (Schriro, supra,
542 U.S. at p. 352.) The California Supreme Court in Gallardo
prohibited sentencing courts from making “independent
conclusions” about a prior conviction and excluded some of the
evidence sentencing courts used to consider in deciding whether
to increase the defendant’s punishment. (See Gallardo, supra, 4
Cal.5th at p. 136.) But the California Supreme Court did not
reach this conclusion because a sentencing court’s factfinding, or
the kind of evidence sentencing courts used to consider in
connection with that factfinding, was somehow inaccurate or
unreliable. Rather, the California Supreme Court in Gallardo
limited the role of the sentencing court in imposing increased
sentences and the materials the sentencing court can consider to
protect the defendant’s Sixth Amendment jury trial right. (See
id. at p. 135 [“when the sentencing court must rely on a finding
regarding the defendant’s conduct, but the jury did not
necessarily make that finding (or the defendant did not admit to
that fact), the defendant’s Sixth Amendment rights are violated”];
cf. Whorton v. Bockting, supra, 549 U.S. at p. 419 [“Crawford
overruled Roberts because Roberts was inconsistent with the
original understanding of the meaning of the Confrontation
Clause, not because the Court reached the conclusion that the
overall effect of the Crawford rule would be to improve the
accuracy of factfinding in criminal trials”].)
Changing how and to what extent sentencing courts may
make factual findings does not necessarily mean those factual
findings are more or less accurate than factual findings by a jury.
(See Schriro, supra, 542 U.S. at p. 356 [“[w]hen so many
presumably reasonable minds continue to disagree over whether
23
juries are better factfinders at all, we cannot confidently say that
judicial factfinding seriously diminishes accuracy”]; Amons,
supra, 125 Cal.App.4th at p. 866 [“[l]ike Apprendi and Ring [v.
Arizona (2002) 536 U.S. 584 [122 S.Ct. 2428]] before it, nothing in
the Blakely opinion corrected a procedure that acutely diminished
the accuracy of previously rendered convictions or sentences”].)
The United States Supreme Court in Apprendi observed the jury
trial right has evolved to “‘guard against a spirit of oppression
and tyranny on the part of rulers’” and to stand “‘as the great
bulwark of [our] civil and political liberties.’” (Apprendi, supra,
530 U.S. at p. 477; see Blakely, supra, 542 U.S. at p. 306 [“[j]ust
as suffrage ensures the people’s ultimate control in the legislative
and executive branches, jury trial is meant to ensure their control
in the judiciary”].) The California Supreme Court in Gallardo did
not cite the need to correct or compensate for inaccuracy in
judicial factfinding.
The record of conviction a trial court could consider before
Gallardo may have included material with questionable
reliability (such as the Illinois judge’s handwritten notes in
Milton’s case), but the sentencing court in California still had to
apply the beyond-a-reasonable-doubt standard of proof. “[T]he
Three Strikes law has always required that a qualifying prior
conviction be ‘pled and proved,’” and “courts have held or
acknowledged that the prosecution bears the burden of proving
beyond a reasonable doubt that a prior conviction is a serious or
violent felony.” (People v. Frierson (2017) 4 Cal.5th 225, 233; see
People v. Miles (2008) 43 Cal.4th 1074, 1082, 1094 [“[t]he People
must prove all elements of an alleged sentence enhancement
beyond a reasonable doubt”]; People v. Hudson (2018) 28
Cal.App.5th 196, 203 [the prosecution must prove beyond a
24
reasonable doubt that the defendant’s prior conviction was a
serious or violent felony].) Because Gallardo did not change the
prosecution’s burden to prove the truth of allegations supporting
an increased sentence, the rule announced in Gallardo did not
result in a significant increase in accuracy. Gallardo is not
necessary to prevent an “‘“‘impermissibly large risk’”’” (Whorton
v. Bockting, supra, 549 U.S. at p. 418) of an inaccurate conviction.
(See id. at at p. 420 [“the question here is not whether Crawford
resulted in some net improvement in the accuracy of fact finding
in criminal cases,” but “‘whether testimony admissible under
Roberts is so much more unreliable . . . that the Crawford rule is
“one without which the likelihood of an accurate conviction is
seriously diminished”’”].)
Nor does the rule in Gallardo ‘“alter our understanding of
the bedrock procedural elements essential to the fairness of a
proceeding.’” (Whorton v. Bockting, supra, 549 U.S. at p. 418.) In
order to qualify as a bedrock procedural rule, “a new rule must
itself constitute a previously unrecognized bedrock procedural
element that is essential to the fairness of a proceeding. In
applying this requirement, we . . . have looked to the example of
Gideon [v. Wainwright (1963) 372 U.S. 335 [83 S.Ct. 792]] and
‘we have not hesitated to hold that less sweeping and
fundamental rules’ do not qualify.” (Whorton, at p. 421; see id. at
p. 420 [“[t]he Crawford rule also did not ‘alter our understanding
of the bedrock procedural elements essential to the fairness of a
proceeding’”].) Indeed, Apprendi and Blakely (an extension of
Apprendi) did not announce “bedrock” rules. (See Amons, supra,
125 Cal.App.4th at p. 867 [“Blakely did not proclaim . . . a
‘bedrock principle’”]; United States v. Sanchez-Cervantes, supra,
282 F.3d at p. 669 [rule established in Apprendi is not “a bedrock
25
procedural element”].) If Apprendi, Blakely, and Crawford did
not alter “bedrock procedural rules” fundamental to a fair
proceeding, Gallardo didn’t either.
3. Gallardo Is Not Retroactive Under Johnson
Under Johnson, supra, 3 Cal.3d 404 “[t]he retrospective
effect of a law-making opinion is to be determined by ‘“(a) the
purpose to be served by the new standards, (b) the extent of the
reliance by law enforcement authorities on the old standards, and
(c) the effect on the administration of justice of a retroactive
application of the new standards.”’ [Citations.] It is also clear
that the factors of reliance and burden on the administration of
justice are of significant relevance only when the question of
retroactivity is a close one after the purpose of the new rule is
considered.” (Id. at p. 410; see In re Thomas, supra, 30
Cal.App.5th at p. 763 [“we weigh the new rule’s importance and
impact against the disruption that would be caused by applying
the new rule to final cases where law enforcement, including
prosecutors, relied on the old rule in investigating and
prosecuting those cases originally”].)
“Fully retroactive decisions are seen as vindicating a right
which is essential to a reliable determination of whether an
accused should suffer a penal sanction. . . . [¶] On the other
hand, decisions which have been denied retroactive effect are
seen as vindicating interests which are collateral to or relatively
far removed from the reliability of the fact-finding process at
trial.” (Johnson, supra, 3 Cal.3d at pp. 410-412.) “If the new rule
aims . . . to define procedural rights merely incidental to a fair
determination of guilt or innocence, it will generally not be given
retroactive effect. [Citations.] On the other hand, if a decision
26
goes to the integrity of the factfinding process [citation] or
‘implicates questions of guilt and innocence’ [citation],
retroactivity is the norm.” (In re Thomas, supra, 30 Cal.App.5th
at p. 763; see People v. Guerra (1984) 37 Cal.3d 385, 402
[“‘[w]here the major purpose of new constitutional doctrine is to
overcome an aspect of the criminal trial that substantially
impairs its truth-finding function and so raises serious questions
about the accuracy of guilty verdicts in past trials, the new rule
has been given complete retroactive effect’”].)
a. Gallardo Established a New Rule Under
State Law
“Decisions establish ‘new rules’ when they depart from
clear contrary rules established in prior judicial decisions. In
practice, that means decisions establish new rules when they (1)
explicitly overrule a precedent of the California Supreme Court,
or (2) disapprove a practice implicitly sanctioned by prior
decisions of the Supreme Court, or (3) disapprove a long-standing
and widespread practice expressly approved by a near-
unanimous body of lower court authorities.” (In re Thomas,
supra, 30 Cal.App.5th at p. 761; see People v. Guerra, supra, 37
Cal.3d at p. 401.) Gallardo established a new rule under state
law because it “disapproved” McGee and the practice of judicial
factfinding to support an increased penalty. (Gallardo, supra, 4
Cal.5th at p. 125; see People v. Saez (2015) 237 Cal.App.4th 1177,
1199 [“[w]e recognize that for years trial courts in California have
been allowed to determine whether a prior conviction qualifies as
a strike by looking to the ‘entire record of conviction’”].)
27
b. Gallardo Did Not Vindicate a Right
Essential to the Reliability of the
Factfinding Process
As stated in connection with the federal retroactivity test,
by limiting the sentencing court’s role and limiting the evidence
the court can consider in determining whether to increase the
defendant’s punishment, the California Supreme Court in
Gallardo did not impugn the accuracy of factfinding by trial
courts. The Supreme Court in Gallardo held that independent
inquiry and factfinding by sentencing courts were problematic
because such actions “invaded[d] the jury’s province.” (Gallardo,
supra, 4 Cal.5th at p. 136.) As discussed, however, judicial
factfinding is not inherently unreliable or less reliable than jury
factfinding. (See Schriro, supra, 542 U.S. at p. 356; In re
Consiglio (2005) 128 Cal.App.4th 511, 515; see also Johnson,
supra, 3 Cal.3d at p. 412 [“although . . . cases recognized that
juries may serve to prevent arbitrariness and repression, they did
not rest on any assumption that nonjury trials are more likely
than jury trials to be unfair or unreliable”].)10
10 Also as discussed in connection with the federal test for
retroactivity, Gallardo did not raise the standard of proof for
proving the truth of prior conviction allegations to support an
increased sentence. Given that before Gallardo the prosecution
had to prove beyond a reasonable doubt a prior conviction
qualified as a serious or violent felony, we cannot say the “‘major
purpose’” of Gallardo was to “‘overcome an aspect of the criminal
trial that substantially impair[ed] . . . truth-finding function and
so raise[d] serious questions about the accuracy of guilty verdicts
in past trials.’” (People v. Guerra, supra, 37 Cal.3d at p. 402.)
28
Recent cases holding Sanchez is not retroactive support the
conclusion that Gallardo is not retroactive. In In re Thomas,
supra, 30 Cal.App.5th 744 the court explained that hearsay
evidence of a defendant’s gang membership, previously
admissible as the basis for a gang expert’s opinion, did not
“raise[ ] doubts about the fundamental fairness of past trials” or
“threaten[ ] to lead to the introduction of corrupt evidence
supporting conviction.” (Id. at p. 765.) The court in Thomas
stated that after Sanchez—because the expert could simply
present his or her opinion without stating its hearsay basis, or
the prosecution could call another witness “to provide the
foundation for the expert’s opinion”— the connection of the
Sanchez rule to “the factuality of convictions is attenuated and
does not raise serious questions about the accuracy of guilty
verdicts in past trials.” (In re Thomas, at pp. 765-766; see In re
Ruedas, supra, 23 Cal.App.5th at p. 800 [after Sanchez, the
prosecutor can call the hearsay declarant as a witness or ask the
expert to describe the hearsay information that formed the basis
of his or her opinion in general terms].)
Similarly, as the Supreme Court in Gallardo recognized, a
prosecutor can “demonstrate to the trial court, based on the
record of the prior plea proceedings, that defendant’s guilty plea
encompassed a relevant admission about the nature of her
crime.” (Gallardo, supra, 4 Cal.5th at p. 139.) Thus, if Gallardo
applied retroactively to Milton, the prosecutor on remand could
review the Illinois record for findings the Illinois jury necessarily
made in convicting him of armed robbery, as well as factual
admissions Milton made (such as the “stipulated facts” to which
the Illinois sentencing court referred) in pleading guilty to simple
robbery, to prove Milton used a gun in committing either or both
29
crimes. Although under Gallardo the People could not use the
Illinois judge’s handwritten notes or statements to prove Milton
used a gun, the People could prove Milton used a gun by other
means.11
c. Applying Gallardo Retroactively Would
Be Disruptive
Even if the question of retroactivity were “a close one” (In
re Johnson, supra, 3 Cal.3d at p. 410), the final factor of the state
test for retroactivity weighs against retroactive application. As
discussed, at and after the time of Milton’s sentencing California
courts affirmed sentence enhancements based on factual findings
by sentencing courts. (See Gallardo, supra, 4 Cal.5th at p. 125
[“For some time, California cases have held that . . .
determinations [of whether a prior conviction qualified as a
11 The cases Milton cites are distinguishable because they
involved substantive changes to the law that implicated the
defendant’s guilt and innocence. (See Johnson, supra, 3 Cal.3d at
p. 416 [Leary v. United States (1969) 395 U.S. 6 [89 S.Ct. 1532],
which held a defendant’s assertion of the Fifth Amendment
privilege against self-incrimination is a complete defense to a
prosecution under a federal criminal statute, was retroactive
because “Leary . . . involves the question of guilt and innocence as
well as Fifth Amendment values which are collateral to guilt”]; In
re Lucero (2011) 200 Cal.App.4th 38, 41, 46 [People v. Chun
(2009) 45 Cal.4th 1172, which held “the crime of shooting at an
occupied vehicle . . . can no longer provide a predicate for
application of the felony-murder rule,” was retroactive because
the defendant “might have been acquitted of murder but for
application of the felony-murder rule”].)
30
serious felony] are to be made by the court, rather than the jury,
based on a review of the record of the prior criminal
proceeding.”].) Applying Gallardo retroactively would cause
significant disruption by requiring courts to reopen countless
cases, conduct new sentencing hearings, and locate records of
proceedings conducted long ago to ascertain “what facts were
necessarily found or admitted in the prior proceeding.”
(Gallardo, at p. 138; cf. In re Thomas, supra, 30 Cal.App.5th at
p. 766 [“applying Sanchez retroactively to final cases would result
in reopening thousands of cases in which the prosecution used a
shortcut even though it could have obtained a conviction using
other evidence,” which “would be too disruptive and costly”]; In re
Ruedas, supra, 23 Cal.App.5th at p. 801 [“It cannot be gainsaid
that it would be exceedingly disruptive and costly to retry the
many thousands of cases that were adjudicated under the old
[pre-Sanchez] framework.”].)
DISPOSITION
The petition is denied.
SEGAL, J.
We concur:
PERLUSS, P. J. ZELON, J.
31
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