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SEVEN W. ENTERPRISES, INC. & SUBSIDIARIES, PETITIONERS v.
COMMISSIONER OF INTERNAL REVENUE, RESPONDENT
HIGHLAND SUPPLY CORPORATION & SUBSIDIARIES,
PETITIONERS v. COMMISSIONER OF INTERNAL
REVENUE, RESPONDENT
Docket Nos. 13594–08, 13595–08. Filed June 7, 2011.
From February 2001 until March 2002, M worked as a
consultant for P1 and P2 (collectively, Ps). During this period,
M prepared P1’s 2000 tax return and P2’s 2001 tax return. In
March 2002, Ps hired M as their vice president of taxes. As
Ps’ vice president of taxes, M prepared and signed, on behalf
of Ps, P1’s 2001, 2002, and 2003 tax returns and P2’s 2002,
2003, and 2004 tax returns. In 2000 through 2004, Ps incor-
rectly concluded that they were not liable for personal holding
company taxes and, as a result, understated their tax liabil-
ities relating to those years. R issued P1 a notice of deficiency
relating to 2000 through 2003 and P2 a notice of deficiency
relating to 2003 and 2004. In the notices, R determined that
Ps were liable for accuracy-related penalties. Ps contend that
they had reasonable cause for their underpayments and acted
in good faith. Alternatively, Ps contend that they reasonably
relied on the advice of M in 2000 when M served as a consult-
539
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540 136 UNITED STATES TAX COURT REPORTS (539)
ant and in 2001 through 2004 when he served as vice presi-
dent of taxes.
1. Held: Pursuant to sec. 1.6664–4(b)(1) and (c)(1), Income
Tax Regs., P1 is not liable for an accuracy-related penalty
relating to 2000 because it reasonably relied on M to prepare
its tax return.
2. Held, further, M does not qualify as ‘‘a person, other than
the taxpayer’’, pursuant to sec. 1.6664–4(c)(2), Income Tax
Regs., with respect to the returns which he signed on behalf
of Ps, and therefore the aforementioned regulation is not
applicable to Ps’ underpayments of taxes relating to 2001
through 2004.
3. Held, further, Ps are liable for accuracy-related penalties
relating to 2001 through 2004.
Patrick B. Mathis, William J. Niehoff, and Philip D.
Speicher, for petitioners.
James M. Cascino, David B. Flassing, and William G.
Merkle, for respondent.
FOLEY, Judge: The issue for decision is whether petitioners
are liable for section 6662(a) 1 accuracy-related penalties
relating to tax years ending in 2000, 2001, 2002, 2003, and
2004 (years in issue). 2
FINDINGS OF FACT
The Weder family controlled two closely held businesses:
Highland Supply Corporation (HSC) and Seven W. Enter-
prises, Inc. (7W). HSC was the parent of a group of corpora-
tions (collectively, HSC Group) which filed a consolidated Fed-
eral income tax return and manufactured floral, packaging,
and industrial wire products. HSC Group included Highland
Southern Wire, Inc., and Weder Investment, Inc. (WI). 3 7W,
a corporation principally engaged in leasing nonresidential
buildings, was the parent of a group of entities (collectively,
7W Group), which filed a consolidated Federal income tax
return. 7W owned an 89-percent interest in Weder Agricul-
tural Limited (WAL), a limited partnership.
In 1990, HSC Group and 7W Group (collectively, peti-
tioners) hired William Mues, a certified public accountant, to
1 Unless otherwise indicated, all section references are to the Internal Revenue Code of 1986,
as amended and in effect for the years in issue.
2 The years in issue are the tax years ending Dec. 31, 2000, 2001, 2002, and 2003, with respect
to 7W Group and the tax years ending Apr. 30, 2003 and 2004, with respect to HSC Group.
3 WI is wholly owned by Highland Southern Wire, Inc., which is wholly owned by HSC.
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(539) SEVEN W. ENTERS., INC. v. COMMISSIONER 541
serve as their tax manager. Mues had experience relating to
personal holding company tax matters and had previously
worked at Deloitte Haskins & Sells, preparing tax returns for
individuals, corporations, partnerships, and trusts, and at
Peabody Coal Co., preparing consolidated returns. In 1991,
petitioners promoted Mues to vice president of taxes. While
employed by petitioners, Mues drafted documents, performed
general legal work, and prepared returns for petitioners and
petitioners’ shareholders. Petitioners provided Mues with full
access to all resources necessary to handle petitioners’ tax
matters (i.e., access to corporate and accounting personnel,
corporate records, research databases, and outside profes-
sionals). In addition, petitioners authorized Mues to sign, on
their behalf, Internal Revenue Service (IRS) documents.
On December 12, 1995, Southpac Trust International, Inc.,
as trustee of the Family Trust (STI), an entity unrelated to
petitioners, executed a $4,062,000 interest-bearing promis-
sory note (the promissory note) for the benefit of HSC. In
1996, HSC assigned the promissory note to WI.
In 1997, the IRS began auditing HSC Group’s 1995 return
and eventually expanded the audit to include HSC Group’s
1996 and 1997 returns. On April 2, 1999, the IRS and HSC
Group reached a settlement with respect to the audit relating
to HSC Group’s 1995, 1996, and 1997 returns. The agreed
adjustments were in excess of $2.2 million and included the
disallowance of more than $450,000 of deductions relating to
HSC’s president’s personal expenses. These adjustments were
set forth on Form CG–4549, Income Tax Examination
Changes, which required HSC Group’s signature. Mues signed
his name on the line labeled ‘‘Signature of Taxpayer’’. The
IRS and petitioners also reached settlements relating to HSC
Group’s and 7W Group’s 1998 and 1999 returns. HSC Group
had recurring adjustments relating to research and develop-
ment expenses.
While an employee of petitioners and prior to 2001, Mues
obtained a master’s degree in business administration and
began law school as a part-time student. In January 2001,
Mues resigned as vice president of taxes and continued his
legal studies as a full-time student. After resigning, Mues,
pursuant to an agreement, provided petitioners with con-
sulting services concerning tax matters and was not subject
to petitioners’ supervision or direction. As a consultant, Mues
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542 136 UNITED STATES TAX COURT REPORTS (539)
prepared 7W Group’s 2000 return and HSC Group’s 2001
return. In March 2002, after Mues completed law school,
petitioners hired him to serve as their vice president of taxes.
In accordance with his responsibilities, Mues prepared and
signed, on behalf of petitioners, 7W Group’s 2001, 2002, and
2003 returns and HSC Group’s 2002, 2003, and 2004 returns.
With respect to the years in issue, Mues incorrectly
characterized petitioners’ income and concluded that peti-
tioners were not liable for personal holding company taxes.
The personal holding company tax is a penalty tax on undis-
tributed income and is designed to discourage individuals
from using closely held corporations to defer taxation on divi-
dends, interest, rents, and other forms of passive income. See
secs. 541, 543; Fulman v. United States, 434 U.S. 528, 530–
531 (1978); H. Rept. 704, 73d Cong., 2d Sess. (1934), 1939–
1 C.B. (Part 2) 554, 562–563; S. Rept. 558, 73d Cong., 2d
Sess. (1934), 1939–1 C.B (Part 2) 586, 596–598. On HSC
Group’s 2003 and 2004 returns, Mues incorrectly concluded
that interest income, relating to the promissory note held by
WI, was income from a source within HSC Group and that WI
was not liable for the personal holding company tax. As a
result, HSC Group, whose consolidated return included WI,
understated its 2003 and 2004 tax liabilities. On 7W Group’s
2000, 2001, 2002, and 2003 returns, Mues made a similar
mistake with respect to interest income received by WAL.
During 2000, 2001, 2002, and 2003, WAL received interest
income relating to an installment note issued by an entity
outside 7W Group, and each year 7W, in determining its
income, took into account a portion of that interest income
equal to 7W’s distributive share. For purposes of calculating
the personal holding company tax, however, Mues did not
take this income into account. In addition, Mues misapplied
the personal holding company tax rules relating to rental
income and, in doing so, incorrectly concluded that 7W’s
rental income was not subject to the personal holding com-
pany tax. As a result, 7W Group understated its 2000
through 2003 tax liabilities.
On March 7, 2008, respondent issued 7W Group a notice
of deficiency relating to 2000, 2001, 2002, and 2003 and HSC
Group a notice of deficiency relating to 2003 and 2004 (collec-
tively, notices). In the notices, respondent determined that
petitioners were liable for section 6662(a) accuracy-related
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(539) SEVEN W. ENTERS., INC. v. COMMISSIONER 543
penalties. On June 4, 2008, petitioners, whose principal place
of business was Highland, Illinois, timely filed petitions with
the Court seeking redetermination of the penalties set forth
in the notices.
OPINION
Section 6662(a) and (b)(2) imposes a 20-percent penalty on
the portion of an underpayment of tax attributable to any
substantial understatement of income tax. The parties agree
that petitioners’ incorrect reporting of personal holding com-
pany tax on their returns relating to the years in issue
resulted in substantial understatements of income tax as
defined in section 6662(d). See sec. 7491(c); Higbee v.
Commissioner, 116 T.C. 438, 446–447 (2001). Section
6664(c)(1), however, provides that no penalty shall be
imposed if a taxpayer demonstrates that there was reason-
able cause for the underpayment and that the taxpayer acted
in good faith. See also sec. 7491(c); Higbee v. Commissioner,
supra. The determination of whether a taxpayer acted with
reasonable cause and in good faith depends upon the facts
and circumstances, including the taxpayer’s efforts to assess
his or her proper tax liability; experience, knowledge, and
education; and reliance on the advice of a professional tax
advisor. Sec. 1.6664–4(b)(1), Income Tax Regs.
I. 7W Group’s 2000 Return
With respect to its 2000 return, 7W Group contends that
it is entitled to relief from the accuracy-related penalty
because it relied in good faith on the advice of Mues, an inde-
pendent, competent tax advisor. Indeed, when he prepared
7W Group’s 2000 return, Mues, having resigned from his
position as petitioners’ vice president of taxes, was working
for petitioners pursuant to a consulting agreement.
Respondent emphasizes that Mues continued to perform the
same activities before and after his resignation; requests, in
essence, that we ignore the consulting agreement; and urges
us to hold that Mues was not sufficiently independent for
petitioners to avail themselves of relief pursuant to section
6664(c).
We reject respondent’s contention. Mues resigned, signed a
valid consulting agreement, and served as petitioners’ inde-
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544 136 UNITED STATES TAX COURT REPORTS (539)
pendent contractor. See Nationwide Mut. Ins. Co. v. Darden,
503 U.S. 318, 322–325 (1992); Weber v. Commissioner, 103
T.C. 378, 387–390 (1994) (delineating factors to be considered
when determining an employment relationship between par-
ties), affd. 60 F.3d 1104 (4th Cir. 1995). In addition, Mues
signed 7W Group’s 2000 return as a paid preparer and the
consulting agreement specifically provided that he was not
subject to petitioners’ supervision. 7W Group provided Mues,
an experienced and knowledgeable tax professional, with all
of the relevant information necessary to prepare the return
and relied, in good faith, on Mues to accurately and correctly
prepare 7W Group’s 2000 return. Therefore, it was reason-
able for 7W Group to rely on Mues to prepare its 2000
return. See sec. 6664(c); Montgomery v. Commissioner, 127
T.C. 43, 67 (2006) (stating that it is reasonable to rely on an
advisor’s professional judgment if the taxpayer ‘‘selects a
competent tax adviser and supplies him or her with all rel-
evant information’’ and that ‘‘a taxpayer who seeks the
advice of an adviser does not have to challenge the adviser’s
conclusions, seek a second opinion, or try to check the advice
by reviewing the tax code himself or herself.’’ (citing United
States v. Boyle, 469 U.S. 241, 250–251 (1985))); sec. 1.6664–
4(b)(1), (c)(1), Income Tax Regs. Accordingly, 7W Group is not
liable for the section 6662(a) accuracy-related penalty
relating to 2000.
II. Petitioners’ 2001 Through 2004 Returns
Petitioners contend that they exercised ordinary business
care and prudence relating to their 2001 through 2004
returns. We disagree. It is unclear whether petitioners’
myriad of mistakes was the result of confusion, inattention
to detail, or pure laziness, but we are convinced that peti-
tioners and Mues failed to exercise the requisite due care.
See United States v. Boyle, supra at 250–251; Neonatology
Associates, P.A. v. Commissioner, 115 T.C. 43, 98 (2000), affd.
299 F.3d 221 (3d Cir. 2002).
Petitioners are sophisticated taxpayers. See Campbell v.
Commissioner, 134 T.C. 20, 33 (2010); sec. 1.6664–4(b)(1),
Income Tax Regs. Indeed, Mues was a well-educated and
experienced tax professional with full access to petitioners’
records and personnel. Petitioners readily acknowledge that
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(539) SEVEN W. ENTERS., INC. v. COMMISSIONER 545
Mues was familiar with the personal holding company tax
rules, yet emphasize that these rules are complex and that
Mues’ mistakes were reasonable. The personal holding com-
pany tax rules certainly are complex, but Mues failed to
apply some of the most basic provisions of those rules. In
fact, Mues conceded that in applying the section 543(a)(2)
test he ‘‘truncated the test’’ and ‘‘misapplied the second
prong’’. He simply did not read the entire test. Moreover, he
did not understand or do the requisite work to ascertain the
basic facts relating to petitioners’ income items. For example,
the applicability of the personal holding company tax rules to
HSC Group (or any member of the affiliated group) depended
in part on the determination of whether income items were
from inside or outside the affiliated group. See sec. 542(b).
Mues failed to recognize that STI (i.e., the debtor on the note
held by WI) was an entity outside the HSC Group. Mues was
petitioners’ vice president of taxes both when the note was
executed and when it was assigned. Furthermore, Mues testi-
fied that he knew at the time he prepared HSC Group’s
returns that the note’s debtor was outside the group, yet he
inexplicably treated the interest income as if it was derived
from within HSC Group and not subject to the personal
holding company tax. When asked by the Court whether this
was reasonable, Mues stated: ‘‘it seemed reasonable at the
time. It seems less reasonable now in hindsight.’’ Petitioners’
repeated audit adjustments relating to multiple IRS audits
coupled with Mues’ experience, expertise, and education fur-
ther bolster our conclusion that petitioners failed to exercise
ordinary business care and prudence as to the disputed
items. See Cobb v. Commissioner, 77 T.C. 1096, 1101–1102
(1981), affd. without published opinion 680 F.2d 1388 (5th
Cir. 1982).
Petitioners further contend that the accuracy-related pen-
alties should not apply because they relied on the advice of
Mues—a competent tax advisor. Again, we disagree. As pre-
viously discussed, good-faith reliance on the advice of an
independent, competent tax advisor may constitute reason-
able cause and good faith. Sec. 1.6664–4(b)(1), (c)(1), Income
Tax Regs.; see also Neonatology Associates, P.A. v. Commis-
sioner, supra at 98. The right to rely on professional tax
advice, however, is subject to certain restrictions. See United
States v. Boyle, supra at 250–251; sec. 1.6664–4(b), (c),
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546 136 UNITED STATES TAX COURT REPORTS (539)
Income Tax Regs. Pursuant to section 1.6664–4(c)(2), Income
Tax Regs., ‘‘advice’’ is ‘‘any communication * * * setting
forth the analysis or conclusion of a person, other than the
taxpayer’’. (Emphasis added.)
Petitioners contend that, pursuant to section 7701(a)(1)
and (14), the definition of a ‘‘taxpayer’’ is limited to peti-
tioners (i.e., the persons subject to the tax) and does not
include Mues—petitioners’ employee. A corporation can act
(e.g., sign the corporation’s return) only through its officers.
See sec. 6062; DiLeo v. Commissioner, 96 T.C. 858, 875
(1991), affd. 959 F.2d 16 (2d Cir. 1992). Petitioners author-
ized Mues to act as both the vice president of taxes and the
taxpayer. Indeed, unlike the 2000 return, which Mues signed
as a paid preparer, the 2001 through 2004 returns were
signed by Mues on petitioners’ behalf. Simply put, Mues does
not qualify as ‘‘a person, other than the taxpayer’’ with
respect to the returns which he signed on behalf of the tax-
payer (i.e., petitioners). Thus, petitioners did not have
reasonable cause for the 2001 through 2004 underpay-
ments. 4 See sec. 1.6664–4(b) and (c), Income Tax Regs. We
need not, and do not, opine as to whether reliance on an in-
house professional tax advisor may establish reasonable
cause in other circumstances.
Contentions we have not addressed are irrelevant, moot, or
meritless.
To reflect the foregoing,
Appropriate decisions will be entered.
f
4 We note that petitioners, citing several regulations, contend that respondent’s position is con-
trary to regulations providing that reasonable cause includes reliance on the advice of ‘‘house
counsel’’. The cited regulations simply are not applicable. Secs. 53.4941(a)–1(b)(6), 53.4945–
1(a)(2)(vi), 53.4955–1(b)(7), and 53.4958–1(d)(4)(iii)(A), Foundation Excise Tax Regs., relate to
prohibited transactions and the application of excise taxes. Sec. 1.856–7(c)(2)(iii), Income Tax
Regs., relates to the determination of whether an entity qualifies, pursuant to sec. 856(c), as
a real estate investment trust. These regulations are distinguishable because they explicitly pro-
vide that legal counsel includes ‘‘house counsel’’ and that the advice of counsel must be in a
‘‘reasoned written opinion’’. Furthermore, while sec. 1.6664–4, Income Tax Regs., provides a
standard for determining whether a taxpayer has acted in good faith, the cited regulations re-
late to whether a taxpayer has acted willfully.
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763 S.W.2d 81 (1989)
297 Ark. 485
Starla JONES, Appellant,
v.
STATE of Arkansas, Appellee.
No. CR 88-210.
Supreme Court of Arkansas.
January 23, 1989.
*82 James R. Marschewski, Public Defender, by R. Paul Hughes, III, Chief Deputy Public Defender, Fort Smith, for appellant.
Theodore Holder, Asst. Atty. Gen., Little Rock, for appellee.
DUDLEY, Justice.
Appellant, Starla Jones, pleaded guilty to the offense of theft by deception, a Class C felony. At the time the offense was committed, in October 1986, the applicable statute authorized the trial court to sentence a defendant to a fine and suspend imposition of sentence as to imprisonment. Ark.Stat. Ann. § 41-803(4) (Supp.1985) [Now codified at Ark.Code Ann. § 5-4-104 (Supp.1987)]. The trial court ordered the appellant to pay a $750.00 fine and, in addition, withheld imposition of sentence as to imprisonment for five years. Restitution and costs were additionally ordered paid. The State later filed a petition asking that the appellant be required "to show cause why his suspended sentences should not now be set aside." The trial court treated the petition as one to impose a sentence of imprisonment. A hearing was held and, seven (7) months after its original decree, the trial court ordered that the original suspended imposition of sentence as to imprisonment remain in effect and that appellant be sentenced to sixty (60) days in jail and the amount of restitution be increased. The appellant did not object below to the ruling and now appeals, arguing that the trial court acted beyond its authority in imposing the second sentence. The argument is well taken, and accordingly, we reverse.
Although appellant did not object in the trial court, she need not have done so. The trial court's loss of jurisdiction over a defendant "is always open, cannot be waived, can be questioned for the first time on appeal, and can even be raised by this court." Coones v. State, 280 Ark. 321, 657 S.W.2d 553 (1983); Lambert v. State, 286 Ark. 408, 692 S.W.2d 238 (1985).
The trial court fined the appellant $750.00 and suspended imposition of the sentence of imprisonment. After such a sentencing procedure the trial court correctly entered a judgment of conviction. See Ark.Code Ann. § 5-4-301(d)(1) (1987) [Formerly Ark.Stat.Ann. § 41-1201(3)(a) (Repl.1977)]. The commentary following Ark.Stat.Ann. § 41-1201(3) effectively explains the legislative intent:
Subsection (3) excepts two situations from the general rule that a judgment of conviction is not to be entered when a court orders suspension or probation. The first is when the court fines the defendant and suspends or probates him only as to imprisonment. The court must enter a judgment of conviction if it is to have a basis for imposing a fine. Furthermore, the defendant who is found guilty of an offense and sentenced to pay a fine only has clearly been "convicted" of the offense. The result should not be different when the court fines the defendant and suspends imposition of sentence or places him on probation as to imprisonment.
Clearly, a plea of guilty, coupled with a fine and a suspension of imposition of sentence of imprisonment constitutes a conviction. David v. State, 286 Ark. 205, 691 S.W.2d 133 (1985).
A trial court loses jurisdiction to modify or amend the original sentence, once a valid sentence is put into execution. Toney v. State, 294 Ark. 473, 743 S.W.2d 816 (1988); Redding v. State, 293 Ark. 411, 738 S.W.2d 410 (1987). The issue then becomes, is a sentence by a circuit court to pay a valid fine put into execution when the judgment of conviction is entered? The obvious answer is yes. Unless the court directs payments by installment the whole fine is payable immediately. Ark.Code Ann. § 5-4-202(b) (1987) [Formerly Ark. Stat.Ann. § 41-1102 (Repl.1977)]. When *83 the fine is adjudicated against the defendant in circuit court, the sheriff is to collect it. Ark.Code Ann. § 16-92-115 (Supp.1987) [Formerly Ark.Stat.Ann. § 43-2503 (Repl. 1977)]. In addition, a judgment that a defendant pay a fine constitutes a lien on his real and personal property in the same manner as a judgment in a civil action. Ark.Code Ann. § 5-4-204(b) (1987) [Formerly Ark.Stat.Ann. § 41-1104(2) (Repl. 1977)]. Also, a defendant may be ordered to show cause why he should not be imprisoned for nonpayment. Ark.Code Ann. § 5-4-203 (1987) [Formerly Ark.Stat.Ann. § 41-1103 (Repl.1977)]. The valid fine assessed in the original judgment of conviction in this case was put in execution long before the trial court attempted to modify the sentence. Thus, the attempted modification of the original order was erroneous.
The State argues that the trial court was following Ark.Code Ann. § 5-4-306(b) (1987) [Formerly Ark.Stat.Ann. § 41-1205 (Repl.1977)], which authorizes modifying conditions imposed in an order suspending imposition of sentence. The short answer to that argument is that the original order only suspended imposition of sentence as to imprisonment. It did not suspend imposition of the fine.
The order modifying the original sentence is reversed.
REVERSED AND REMANDED.
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United States Court of Appeals
For the First Circuit
No. 15-1069
DIANA DEL GROSSO;
RAY SMITH; JOSEPH HATCH; CHERYL HATCH;
KATHLEEN KELLEY; ANDREW WILKLUND; RICHARD KOSIBA,
Petitioners,
v.
SURFACE TRANSPORTATION BOARD; UNITED STATES,
Respondents,
GRAFTON & UPTON RAILROAD COMPANY,
Intervenor.
PETITION FOR REVIEW OF A FINAL ORDER OF THE SURFACE
TRANSPORTATION BOARD
Before
Torruella, Selya, and Dyk,*
Circuit Judges.
Mark Bobrowski, with whom Blatman, Bobrowski & Mead LLC was on
brief, for petitioners.
Erik G. Light, Attorney, Surface Transportation Board, with
whom William J. Baer, Assistant Attorney General, Robert B.
Nicholson and Shana Marie Wallace, Attorneys, Department of
Justice, Craig M. Keats, General Counsel, and Evelyn G. Kitay,
Deputy General Counsel, were on brief, for respondents.
James E. Howard, with whom John A. Mavricos, Jonah M. Temple,
Christopher, Hays, Wojcik & Mavricos LLP, Linda J. Morgan, and
Nossaman, LLP, were on brief, for intervenor.
*
Of the Federal Circuit, sitting by designation.
October 16, 2015
-2-
DYK, Circuit Judge. Diana del Grosso, et al.
("petitioners") petitioned the Surface Transportation Board
("Board") for a declaratory order that state and local regulations
of a facility owned by Grafton & Upton Railroad Company ("G&U")
were not preempted by the Interstate Commerce Commission
Termination Act ("ICCTA"), Pub L. No. 104-88, 109 Stat. 803. The
Board held that state and local regulations were preempted because
the facility was part of "transportation by rail carrier." 49
U.S.C. § 10501(a)(1). We affirm the Board’s decision that the
facility was operated by a "rail carrier." But because the Board
relied on an erroneous standard in concluding that the activities
at the facility were a part of "transportation," we vacate and
remand.
I.
Under the ICCTA, the Board has jurisdiction over
"transportation by rail carrier." Id. Where the Board has such
jurisdiction, it is exclusive. Whether or not the Board is
exercising its regulatory authority over the transportation, state
and local1 laws governing such transportation are generally
preempted. See id. § 10501(b) ("[T]he remedies provided under this
1
In a companion case decided today, Padgett v. Surface
Transportation Board, No. 14-2067, slip op. at 7 (1st Cir. Oct. 16,
2015), we confirm that preemption applies to local as well as state
regulations.
-3-
part with respect to regulation of rail transportation are
exclusive and preempt the remedies provided under Federal or State
law."); Norfolk S. Ry. Co. v. City of Alexandria, 608 F.3d 150, 157
(4th Cir. 2010); Green Mountain R.R. Corp. v. Vermont, 404 F.3d
638, 642 (2d Cir. 2005); City of Auburn v. U.S. Gov’t, 154 F.3d
1025, 1030 (9th Cir. 1998); see also Borough of Riverdale —
Petition for Declaratory Order, STB Finance Docket No. 33466, 1999
WL 715272, at *4 (S.T.B. Sept. 9, 1999) (preemption even where
rail construction project outside Board’s regulatory authority).
Such preemption is not limited to state and local economic
regulation of rail transportation. See N.Y. Susquehanna & W. Ry.
Corp. v. Jackson, 500 F.3d 238, 252 (3d Cir. 2007); Green Mountain,
404 F.3d at 644–45; City of Auburn, 154 F.3d at 1031. But see Fla.
E. Coast Ry. Co. v. City of W. Palm Beach, 266 F.3d 1324, 1337–39
(11th Cir. 2001).
In order for an activity to count as "transportation by
rail carrier," it has to be both "transportation" and operated by
a "rail carrier." Tex. Cent. Bus. Lines Corp. v. City of
Midlothian, 669 F.3d 525, 530 (5th Cir. 2012). "Transportation" is
a broad category that includes any "property, facility,
instrumentality, or equipment" connected to "movement . . . by
rail," as well as various "services related to that movement." 49
U.S.C. § 10102(9)(A)–(B). Whether an activity is conducted by a
"rail carrier" is a case-by-case factual determination based on,
-4-
inter alia, how much control a rail carrier is exercising over the
activity. See Tex. Cent., 669 F.3d at 530–31 (internal quotation
marks, citations omitted). The Board routinely grants declaratory
orders as to whether particular activities are preempted, but the
ICCTA does not delegate to the Board the determination of whether
state and local law is preempted. See 49 U.S.C. § 10501(b).
II.
Here, G&U is a licensed rail carrier that began
operations in 1873. It owns a railroad line that extends from
North Grafton, Massachusetts, to Milford, Massachusetts. Upton is
a town located between Grafton and Milford. In 2008, G&U decided
to expand its rail yard in Upton and develop it into a rail-to-
truck transloading facility. As a part of that plan, G&U undertook
to build a wood pellet facility that would receive wood pellets in
bulk from hopper railcars and transfer them, after some processing
and bagging, onto trucks. G&U also entered into a Terminal
Transloading Agreement with Grafton Upton Railcare LLC ("GU
Railcare"), a part of Dana Companies, a group of companies with
extensive experience in transloading bulk materials. GU Railcare
was neither owned nor operated by G&U. GU Railcare was to operate
the transloading services on behalf of G&U.
By the fall of 2011, G&U finished the wood pellet
facility. At the facility, a vacuum hose is attached to hopper
railcars carrying wood pellets in bulk and sucks the pellets
-5-
through a system that removes dust from the pellets. The pellets
are then moved to silos for temporary storage. Additional dust is
then removed from the pellets, and the pellets are conveyed from
the silos, placed in forty-pound bags, and stacked onto pallets,
fifty bags to a pallet. The pallets are then shrink-wrapped and
stored until they are loaded into trucks for final delivery to
retail stores.
The Upton Board of Selectmen concluded that the
activities at the facility were preempted by the ICCTA, 49 U.S.C.
§ 10501(b), and did not seek to regulate them. However, on August
1, 2012, petitioners, who live near the facility, sought a
declaratory order from the Board that the wood pellet activities
were not part of "transportation by rail carrier" under 49 U.S.C.
§ 10501(b) and that state and local regulations were therefore not
preempted. Petitioners complained that the transloading operations
caused them harms such as exposure to excess glare, light
intrusion, noise, and diminution of property values, and that such
harms would be prevented by enforcement of Upton’s zoning by-laws,
which, for example, restrict a building’s height and require
special permits for manufacturing facilities, which permits could
limit noise and above-ground storage. See, e.g., Town of Upton
Zoning By-Law, § 4.2 Table C (height restrictions); id. § 3.1.3
Table A & n.6 (special permit requirements). The petitioners
mounted a two-pronged attack on the railroad’s claim of preemption.
-6-
First, they argued that the wood pellet transloading operations
were not "transportation" under the ICCTA because they were
manufacturing activities. Second, they argued that GU Railcare was
not a "rail carrier" under the statute.
With respect to the second issue, petitioners requested
discovery of documents regarding the construction, financing,
operation, management, and ownership of the facility in order "to
determine the real relationship" between G&U, GU Railcare, and Dana
Companies. On January 23, 2013, the Board initiated a declaratory
order proceeding but denied the discovery request by petitioners,
noting that petitioners had access to G&U’s transloading agreement
with GU Railcare and its lease agreement for the rail yard, and
that G&U had also not explained why discovery or additional
documents were needed.
On February 13, 2013, petitioners requested
reconsideration of the Board’s denial of discovery. Petitioners
argued mainly that there was new evidence that "raises significant
questions" regarding G&U. The evidence was that G&U was involved
in a separate litigation with the town of Grafton, Massachusetts,
over a proposed propane transloading facility,2 and that evidence
as to the relationship between G&U and the operator of the other
facility could shed light on the relationship between G&U and the
2
This other case is also being decided today. See Padgett
v. Surface Transp. Bd., No. 14-2067, slip op. at 3 (1st Cir. Oct.
16, 2015).
-7-
Dana Companies. On May 7, 2013, the Board denied reconsideration.
It concluded that the various agreements already submitted were
sufficient to determine the issue of whether the activities were
being conducted by a "rail carrier," noting that the Board "is
guided [on that issue] by the terms of the agreements between the
railroad and the transloader." It also concluded that the
relationship between G&U and a third party involving a different
transloading facility was not relevant.
On December 5, 2014, the Board issued a declaratory
order. After concluding that the petitioner had standing to raise
the preemption issue, the order declared that the Board had
exclusive jurisdiction over the transloading activities in G&U’s
facility because they constituted "transportation" by "rail
carrier." The Board concluded that the vacuuming, screening,
bagging, and palletizing of the wood pellets were "transportation"
and not "manufacturing" because, although those activities were
"not essential" to transporting wood pellets by rail, they
"facilitate[d]" such transportation by making it "more efficient."
This was so because the activities allowed G&U to transport the
pellets by hopper cars rather than boxcars. The Board also
distinguished the activities in question from manufacturing and
commercial transactions because they did not "change [the] nature
of the product," even though some of the activities, such as
bagging, "may produce some value to the consumer." The Board also
-8-
determined that GU Railcare was acting on behalf of G&U in
performing the transloading activities, and so a "rail carrier" was
doing the transporting. It finally determined that GU Railcare was
not a sham set up simply to avoid state and local regulations.
The petitioners sought judicial review. We have
jurisdiction pursuant to 28 U.S.C. § 2342. Under the
Administrative Procedure Act ("APA"), we will not set aside the
Board’s determinations unless they are "arbitrary, capricious, an
abuse of discretion, or otherwise not in accordance with law," or
are "unsupported by substantial evidence." See 5 U.S.C. § 706(2).
The APA requires the agency to "articulate a satisfactory
explanation for its action including a ‘rational connection between
the facts found and the choice made.’" Motor Vehicle Mfrs. Ass'n
v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983) (quoting
Burlington Truck Lines, Inc. v. United States, 371 U.S. 156, 168
(1962)); see also Granite State Concrete Co. v. Surface Transp.
Bd., 417 F.3d 85, 91 (1st Cir. 2005).
III.
In this court, both the Board and the railroad argue that
the Board’s decision on the issue of preemption is entitled to
Chevron deference. Chevron U.S.A., Inc. v. Nat. Res. Def. Council,
Inc., 467 U.S. 837 (1984). We disagree.
In Wyeth v. Levine, 555 U.S. 555 (2009), the Supreme
Court explained that "agencies have no special authority to
-9-
pronounce on pre-emption absent delegation by Congress," noting
that the Court had never "deferred to an agency’s conclusion that
state law is pre-empted." Id. at 576–77 (emphasis in original).
Rather, "[w]here . . . Congress has not authorized a federal agency
to pre-empt state law directly, the weight this [c]ourt accords the
agency’s explanation of state law’s impact on the federal scheme
depends on its thoroughness, consistency, and persuasiveness"; that
is, the agency’s decision is entitled only to Skidmore deference.
Id. at 556 (citing Skidmore v. Swift & Co., 323 U.S. 134 (1944)).
Contrary to the Board’s suggestions, nothing in City of
Arlington v. FCC, 133 S. Ct. 1863 (2013), undermines Wyeth. City
of Arlington concerned only whether an agency’s interpretation of
the scope of its jurisdiction is entitled to Chevron deference, did
not even mention Wyeth, and, as the Court explicitly noted, "ha[d]
nothing to do with federalism," id. at 1873, which animates the
Court’s preemption jurisprudence, see, e.g., Wyeth, 555 U.S. at
565; Medtronic, Inc. v. Lohr, 518 U.S. 470, 485 (1996).
Following Wyeth, the courts of appeals have been
unanimous in concluding that Chevron deference does not apply to
preemption decisions by federal agencies. See Seminole Tribe of
Fla. v. Stranburg, No. 14-14524, 2015 WL 5023891, at *13 (11th Cir.
Aug. 26, 2015) ("[D]eference to an agency’s ultimate conclusion of
federal preemption is inappropriate."); Steel Inst. of N.Y. v. City
of New York, 716 F.3d 31, 39–40 (2d Cir. 2013) ("We do not defer to
-10-
an agency’s legal conclusion regarding preemption . . . ."); In re
Universal Serv. Fund Tel. Billing Practice Litig., 619 F.3d 1188,
1200 (10th Cir. 2010) ("An agency’s conclusion that state law is
preempted is not necessarily entitled to deference."); see also St.
Louis Effort for AIDS v. Huff, 782 F.3d 1016, 1024 (8th Cir. 2015);
Do Sung Uhm v. Humana, Inc., 620 F.3d 1134, 1155–56 (9th Cir.
2010). The Fifth Circuit in Franks Investment Co. v. Union Pacific
Railroad Co., 593 F.3d 404 (5th Cir. 2010), has held in particular
that Chevron deference to the Surface Transportation Board on the
question of preemption is inappropriate, holding that "the
[Board’s] decision regarding the preemptive effect of the ICCTA and
the test it uses to determine preemption are not binding on us."
Id. at 413–14 (citing Wyeth). We agree that the Board is not
entitled to Chevron deference on the issue of preemption.3
3
We do not decide whether, if Congress does give express
authority to an agency to determine the scope of preemption,
Chevron deference would apply. See Medtronic, 518 U.S. at 495–96
(citing Chevron and giving "substantial weight" to an agency’s
pronouncement on a preemption issue where there was an express
preemption provision in the organic statute and Congress explicitly
granted agency authority to exempt state regulations from
preemption); see also City of New York v. FCC, 486 U.S. 57, 63–64
(1988).
Here, in contrast to statutes where Congress has
delegated authority to an agency to pronounce on the scope of
preemption, see Wyeth, 555 U.S. at 576 n.9 (listing examples), the
Board’s organic statute simply states that its remedies are
exclusive and have preemptive effect. See 49 U.S.C. § 10501(b).
The Board’s general authority to issue a declaratory order is
derived from the APA. See 49 U.S.C. § 721(b)(4); 5 U.S.C.
§ 554(e).
-11-
This does not mean that the Board’s preemption decision
earns no deference. We apply Skidmore deference, which allows us
to defer to the Board in so far as we find the Board’s
interpretations persuasive. See Merrimon v. Unum Life Ins. Co. of
Am., 758 F.3d 46, 55 (1st Cir. 2014). We also defer to the Board’s
factual determinations, such as whether there are efficiency gains
connected to the choice of railcars in transportation. Such
determinations need only be supported by substantial evidence and
a "‘rational basis’ . . . in the facts on the record." See
Granite, 417 F.3d at 91–92 (citation omitted); Ross Express, Inc.
v. United States, 529 F.2d 679, 681 (1st Cir. 1976).
IV.
The primary issue on appeal is whether the activities at
the transloading facility at the conclusion of a rail journey —
that is, the vacuuming, screening, bagging, and palletizing of the
wood pellets — constitute rail "transportation," and thus are not
subject to otherwise applicable state and local regulations.
Section 10501 of the ICCTA vests the Board with
"exclusive" jurisdiction over "transportation by rail carriers" and
the "construction, acquisition, operation, abandonment, or
discontinuance of . . . facilities." 49 U.S.C. § 10501(b).
"Transportation" covers "a . . . facility, instrumentality, or
equipment of any kind related to the movement of passengers or
property, or both, by rail," 49 U.S.C. § 10102(9)(A), as well as
-12-
"services related to that movement, including receipt, delivery,
elevation, transfer in transit, . . . storage, handling, and
interchange of passengers and property," 49 U.S.C. § 10102(9)(B).
It is well-established that the preemption of state and
local regulation under the ICCTA generally extends to transloading
facilities. Transloading, performed at the "starting or ending
point of the rail component of the movement," New Eng. Transrail,
STB Finance Docket No. 34797, 2007 WL 1989841, at *1 (S.T.B. Jun.
29, 2007), involves transferring bulk shipments from one type of
vehicle to another at an interchange point. See N.Y. Susquehanna,
500 F.3d at 242 n.1. In the language of the statute, transloading
typically involves "receipt, . . . storage, handling, and
interchange" or "transfer in transit" of goods. 49 U.S.C.
§ 10102(9)(B). Such activities are generally preempted. See N.Y.
Susquehanna, 500 F.3d at 247–49 (waste transloading from trucks to
railcars headed to landfills); Tex. Cent., 669 F.3d at 530
(transloading of hydraulic fracking sand, including offloading sand
from railcars to silos and loading onto trucks); Norfolk, 608 F.3d
at 154, 158 (transfer of bulk shipments of ethanol from railcars
onto surface tank trucks); Green Mountain, 404 F.3d at 640, 645
(unloading of bulk salt and cement arriving by rail to load onto
trucks for local distribution or to temporarily store pending
distribution).
-13-
In short, as a general matter, "intermodal transloading
operations and activities involving loading and unloading materials
from rail cars and temporary storage of materials" are a part of
transportation. New Eng. Transrail, 2007 WL 1989841, at *6; see
also, e.g., Tex. Cent., 669 F.3d at 530; Green Mountain, 404 F.3d
at 642. That such transloading activities are integral to the
physical movement of goods, and thus "transportation," is an
"indisputable point." Tex. Cent., 669 F.3d at 530.
Petitioners argue that the activities here do not
constitute traditional transloading operations, but rather
constitute manufacturing, and that state and local regulations are
not preempted. In its decision, the Board did not focus on whether
the activities facilitated transloading of the pellets from rail to
truck. Instead, the Board concluded that the transloading
activities here were "transportation" because the vacuuming,
screening, bagging, and palletizing of the wood pellets allowed G&U
to transport the pellets in hopper railcars, which accommodate
twenty more tons of pellets than boxcars. "Were these activities
performed at the manufacturing facility," the Board reasoned, "the
wood pellets would have to be transported in boxcars, in which case
each pallet containing 50 40-pound bags would have to be blocked
and braced in order to limit movement within the boxcar." That in
turn "would consume space and . . . leav[e] less capacity for the
wood pellets themselves."
-14-
We think that the Board’s efficiency rationale goes
beyond the statute and is beside the point. While "transportation"
is "an extremely broad category," Pejepscot Indus. Park, Inc. v.
Me. Cent. R.R. Co., 215 F.3d 195, 199 (1st Cir. 2000), not all
activities connected with rail transportation are considered
"transportation" under the statute. The definition of
"transportation" in the statute, "[w]hile certainly expansive,
. . . does not encompass everything touching on railroads."
Emerson v. Kan. City S. Ry. Co., 503 F.3d 1126, 1129 (10th Cir.
2007). Thus, "manufacturing and commercial transactions that occur
on property owned by a railroad that are not part of or integral to
the provision of rail service are not embraced within the term
‘transportation.’" New Eng. Transrail, 2007 WL 1989841, at *6. In
particular, the ICCTA does not preempt all state and local
regulation of activities that has any efficiency-increasing
relationship to rail transportation. Rather, Subsection (A) of the
definition "focuses on physical instrumentalities ‘related to the
movement of passengers or property,’" while Subsection (B) focuses
on "‘services related to that movement.’" Emerson, 503 F.3d at
1129-30 (emphases added) (quoting 49 U.S.C. § 10102(9)). The
statute is clear on its face that the preempted activities are all
related to the physical movement of "passengers or property."
Here, the proper focus of the Board should have been on
the question of whether the activities — vacuuming, screening,
-15-
bagging, and palletizing — facilitated the physical movement of
"passengers or property" (here the transfer of the pellets from
rail to truck), rather than cost efficiency. The questionable
nature of the Board’s rationale is revealed by a simple example.
Under the Board’s rationale, the transloading facility would be
exempt from regulation if it had been constructed and operated by
the rail carrier at the ultimate destination at a retail store.
Under the Board’s reasoning, the retail facility would be exempt
because postponing the bagging and other operations would have made
it feasible to transport the pellets more efficiently in hopper
cars. We think that sweeps too far. The Board’s efficiency
rationale would result in a vast regulatory gap in which state and
local regulation would be eliminated simply because the facilities
were economically connected to rail transportation.4
Courts and the Board have rejected interpretations of
"transportation" that go beyond facilitating the movement of
"passengers or property." In New England Transrail, the Board held
that state and local regulation of shredding of construction debris
that had arrived at a transloading facility from trucks — before
4
Nor would the Board be able to regulate such facilities.
See Joint Petition for Declaratory Order — Bos. & Me. Corp. & Town
of Ayer, MA, STB Finance Docket No. 33971, 2001 WL 458685, at *4
(S.T.B. Apr. 30, 2001) ("Railroads are not required to obtain Board
approval . . . to build or expand facilities that are ancillary to
a railroad's operations unless the activity is part of a larger
project subject to our jurisdiction (such as construction of a new
rail line).").
-16-
being loaded onto railcars — was not preempted because such
activity did not constitute "transportation." This was so because
the shredding was not necessary to load the debris onto railcars.
See New Eng. Transrail, 2007 WL 1989841, at *9–10 (noting that "a
shredder is not required to pack into rail cars" the debris that
had arrived from trucks. (emphasis added)). In Emerson, 503 F.3d
at 1129–32, the Tenth Circuit similarly rejected an interpretation
of "transportation" that would preempt state tort law governing a
railroad’s dumping of old railroad ties into a wastewater drainage
ditch. The court held that the dumping did not relate to "movement
of passengers or property" under the ICCTA, 503 F.3d at 1130, and
the interpretation would entail the Board’s jurisdiction over the
railroad’s dumping a "dilapidated engine in the middle of Main
Street" simply because "disposing of unneeded railroad equipment
[would be] cost-conscious," id. at 1132. Here, the Board’s
interpretation is defective because it fails to relate the wood
pellet facility’s activities to the physical "movement of
passengers or property," as opposed to cost efficiency.
New England Transrail is not to the contrary. The Board
held that baling and wrapping of solid waste arriving at a
transloading facility from trucks constituted "transportation,"
noting that such baling and wrapping "permits a wider variety of
rail cars to be used." New Eng. Transrail, 2007 WL 1989841, at *9.
But there preemption was appropriate because the baling and
-17-
wrapping was necessary to transload the waste from trucks to
railcars. The Board expressly found that "baling and wrapping are
not the sort of activities that would have value for any other
purpose."5 Id. Here, while the wood pellets are being transloaded
from railcars onto trucks, there has been no Board finding that the
vacuuming, screening, bagging, and palletizing facilitated the
loading of the pellets onto the trucks.
Under these circumstances, a remand is required to
determine whether the vacuuming, screening, bagging, and
palletizing facilitated the transloading of the pellets from the
railcars to the trucks or was done solely for another, unrelated
purpose.
V.
Two collateral issues remain. First, petitioners contend
that the Board erred in not considering the facility’s "re-
pelletization" of the wood pellets. Re-pelletization, a process
which, according to G&U, began around December 2012, involves
screening broken pellets from unbroken pellets, pressing them
together into new pellets, and moving the new pellets into silos
for storage. Petitioners argue that such a process, because it
transforms the nature of the product, constitutes manufacturing and
5
While the fact that the activity adds value to the
consumer (or the railroad) does not bar it from being
transportation, it is equally clear that merely adding value does
not support a claim that the activity is transportation. See New
Eng. Transrail, 2007 WL 1989841, at *10.
-18-
not rail transportation. But whether or not it does constitute
manufacturing — a matter on which we take no view — petitioners did
not raise this issue before the Board, and it is thus not properly
before us. See Commonwealth of Mass., Dep’t of Pub. Welfare v.
Sec’y of Agric., 984 F.2d 514, 523 (1st Cir. 1993) ("In the usual
administrative law case, a court ought not to consider points which
are not seasonably raised before the agency." (citing United States
v. L.A. Trucker Truck Lines, Inc., 344 U.S. 33, 37 (1952))).
However, we do not preclude the Board from considering this issue
on remand.
Second, while petitioners do not ask for judicial review
of the Board’s determination that G&U was operating the facility
and that GU Railcare was acting on behalf of G&U in performing the
transloading activities, they do argue that the Board erred in
denying discovery, which they claim was necessary to determine
whether the transloading activities were being performed by a "rail
carrier." We see no error.
We generally do not intervene in a lower tribunal’s
discovery order unless it was plainly wrong and resulted in
substantial prejudice to the aggrieved party. See Modern
Cont’l/Obayashi v. Occupational Safety & Health Review Comm’n, 196
F.3d 274, 281 (1st Cir. 1999) (appellate court will "intervene in
such matters only upon a clear showing of manifest injustice, that
is, where the lower court's discovery order was plainly wrong and
-19-
resulted in substantial prejudice to the aggrieved party" (citation
omitted)); see also Trailways Lines, Inc. v. Interstate Commerce
Comm’n., 766 F.2d 1537, 1546 (D.C. Cir. 1985) ("[T]he conduct and
extent of discovery in agency proceedings is a matter ordinarily
entrusted to the expert agency in the first instance and will not,
barring the most extraordinary circumstances, warrant the Draconian
sanction of overturning a reasoned agency decision.").
As petitioners seem to concede, the Board’s regulations
permit discovery "regarding any matter, not privileged, which is
relevant to the subject matter involved in a [Board] proceeding,"
49 C.F.R. § 1114.21(a)(1), but they do not require such discovery,
id. ("Parties may obtain discovery . . . ." (emphasis added)). Any
such discovery must still be "relevant to the subject matter
involved," id., and the Board need not order discovery "where the
dispute involves a legal issue and where the record is sufficient
to resolve the controversy without discovery." Md. Transit Admin.
— Petition for Declaratory Order, STB Finance Docket No. 34975,
2008 WL 4281987, at *5 (S.T.B. Sept. 17, 2008). Here, other than
petitioners’ initial barebones request for discovery to determine
the "real" relationship between G&U, GU Railcare, and Dana
Companies, petitioners failed to show a need for any specific
documents. The Board concluded that the transloading agreement and
the lease would suffice to determine whether the relationship
between GU Railcare and G&U was such that the transloading
-20-
activities were being performed by a "rail carrier" and that G&U’s
involvement in a litigation with separate parties involving
separate contracts was not relevant evidence to reopen its
discovery decision. In this proceeding, petitioners fail to
explain why any of this is incorrect, let alone why the Board’s
decision resulted in manifest injustice. There is no basis to set
aside the Board’s decision that the activities in question were
conducted by a "rail carrier."
CONCLUSION
We vacate and remand for further proceedings consistent
with this opinion.
VACATED AND REMANDED
All parties shall bear their own costs.
-21-
| {
"pile_set_name": "FreeLaw"
} |
633 S.E.2d 373 (2006)
INSIGHT TECHNOLOGY, INC.
v.
FREIGHTCHECK, LLC et al.
No. A06A0710.
Court of Appeals of Georgia.
June 20, 2006.
*374 Bruce E. Mitchell, Clare Michaud, Mitchell & Associates, Gary Stokes, Lamberth, Cifelli, Stokes & Stout, P.A., Atlanta, for Appellant.
*375 Morris, Manning & Martin, Alpharetta, Lawrence H. Kunin, Troutman Sanders, Laura D. Windsor, L. Matt Wilson, Dustin R. Thompson, John A. Lockett III, Atlanta, for appellees.
ELLINGTON, Judge.
Insight Technology, Inc. brought this action in the Superior Court of Gwinnett County against Darren Brewer, Patrick Hull, Get-Loaded.com, LLC, and FreightCheck, LLC. Insight asserted claims against these parties for breach of fiduciary duty, misappropriation of trade secrets, misappropriation of corporate opportunities, and fraud. Insight alleged that Brewer, who was Insight's president, and Hull secretly agreed to create FreightCheck to compete with Insight using Insight's own computer software and business practices. The trial court granted the motions for summary judgment filed by Hull, GetLoaded, and FreightCheck on all claims. The trial court granted Brewer's motion for summary judgment in part, reserving to the jury Insight's claims for breach of fiduciary duty, appropriation of corporate opportunities, punitive damages, and attorney fees. Insight appeals, contending jury issues remain on all of its claims, with the exception of its claim against Hull and GetLoaded for appropriation of corporate opportunities. For the reasons explained below, we conclude questions of material fact remain on Insight's claims against Hull, GetLoaded, and FreightCheck for procuring a breach of fiduciary duties, misappropriation of trade secrets, punitive damages, and attorney fees, and reverse the trial court's judgment in part. We affirm the remainder of the trial court's judgment.
"On appeal from the grant of summary judgment [the appellate court] conducts a de novo review of the evidence to determine whether there is a genuine issue of material fact and whether the undisputed facts, viewed in the light most favorable to the nonmoving party, warrant judgment as a matter of law." (Citation and punctuation omitted.) Munroe v. Universal Health Svcs., 277 Ga. 861, 864-865(2), 596 S.E.2d 604 (2004).
Viewed in the light most favorable to Insight, the record contains evidence of the following facts. In 1996, Gary Aliengena incorporated Insight in Delaware as an internet-based freight load matching service, or "load board." Under the name NetTrans, Insight's virtual load board allowed independent truckers or small trucking companies to search online for available hauling jobs that matched their equipment and availability. The load board derived its revenue from membership fees paid both by the trucking companies and by shipping brokers and others who posted specific hauling jobs on the website. Insight also derived revenue from paid advertising on its website. GetLoaded, which Hull formed in Virginia in 1999, operated a similar virtual load board and competed with Insight.
When Aliengena created Insight, he hired Brewer to be the director of marketing. Aliengena and Brewer executed an employment agreement which required Brewer to hold in confidence Insight's trade secrets and confidential information. Despite the designated title in the employment agreement, however, Brewer was the president of Insight during his entire employment with the company. Brewer managed Insight's operations from an office in Norcross.
In 1998, Aliengena decided to expand Insight's business into freight factoring. First under the name Quick Pay, and later under the name FactorLoads, Insight paid truckers immediately on hauling invoices and then, as an assignee, collected payment from the payors, either shippers or freight brokers. Because these assignments were "without recourse," Insight accepted the risk of nonpayment or slow payment. For this service, Insight charged truckers a percentage commission on the face amount of the invoices.
For Insight's FactorLoads service, Brewer created a website, drafted forms, designed procedures, such as for evaluating the credit worthiness of particular shippers and brokers, and trained and supervised employees. In 2000, Brewer caused Insight to buy a commercially available website design program called ColdFusion and then enhanced the program with features useful in the factoring *376 business. Only Insight employees had access to the administrative section of the FactorLoads.com website through the use of passwords.
In late 1999 or 2000, Brewer met Hull, GetLoaded's majority shareholder and "managing member." By this time, Brewer was a 20 percent shareholder in Insight. Brewer tried, unsuccessfully, to persuade Hull to accept an ad for Insight's FactorLoads service on the GetLoaded website. By late 2001, Brewer and Hull began to discuss starting a new internet factoring business together. Hull wanted to partner with Brewer because of Brewer's experience programming in the freight factoring industry. Hull incorporated a new company, FreightCheck, LLC, in Virginia. Hull also created a new company, Maverick Holdings, LLC, as the sole shareholder. Brewer created a new limited liability company, Extranet Commerce, LLC, as the sole shareholder. Hull's wholly owned company, Maverick, and Brewer's wholly owned company, Extranet, then each became 50 percent shareholders in FreightCheck. Hull provided FreightCheck's startup capital by borrowing $100,000 from GetLoaded and then lending that sum to FreightCheck. Declaring that GetLoaded was "financially interested" in FreightCheck, GetLoaded provided a guaranty of FreightCheck's obligations to an industry lender. Hull also provided a personal guaranty on some of FreightCheck's debts.
FreightCheck launched its website and began operating its factoring business, in competition with Insight, on June 1, 2002. By this time, factoring represented about 98% of Insight's total revenue of $5.3 million. Brewer rented office space for FreightCheck in an office suite down the hall from Insight's office so it would be convenient for him to visit FreightCheck's office while still employed at Insight. In the month before FreightCheck became operational, Brewer paid Insight employee Patti Burroughs to train Jeannie Yu in using the FactorPlus software and to train Insight employee Kristina Gersema to use certain accounting software and procedures used in Insight's factoring business. In April 2002, Brewer offered Gersema a job as president of FreightCheck to commence on June 1, subject to Hull's approval. According to Gersema, Brewer told her that he and Hull wanted her to be president of Freight-Check so that Aliengena would not find out about Brewer's connection to the company. FreightCheck also hired Yu. Gersema and Yu signed confidentiality agreements acknowledging that FreightCheck's computer programs, methods, processes and formulas were trade secrets.
The day it launched its business, Freight-Check's website used the customized software program Brewer developed while working for Insight, and the website was nearly identical to Insight's FactorLoads website. On its first day, FreightCheck's website even contained testimonials from "satisfied customers" which were identical to testimonials already appearing on FactorLoads.com. FreightCheck also used the same rate structure, forms, and business methods and processes Brewer developed at Insight. The parties presented conflicting evidence regarding whether Aliengena gave Brewer permission to start a new freight factoring company and to use Insight's forms, processes, methods, software and technology to compete with Insight.
Over the next 21 months, while Brewer continued working as Insight's president and supervising its employees, he spent much of his time in the FreightCheck office, managing its operations and supervising its employees. Brewer informed Hull of almost every aspect of FreightCheck's daily operations and sought Hull's approval of decisions. In November 2003, Brewer filed for copyright protection of the customized application of ColdFusion under the name FactorPlus. Immediately thereafter, Brewer on behalf of Extranet licensed the FactorPlus software both to Insight and to FreightCheck.
Aliengena, Insight's majority shareholder, was unaware of Brewer's relationship with Hull, his 50 percent ownership interest (through Extranet) in FreightCheck, or his role in FreightCheck's operations. On several occasions, Brewer told Gersema, Burroughs and other Insight employees not to tell Aliengena about his involvement in FreightCheck. Aliengena also did not know that Brewer had obtained copyright protection *377 for the FactorPlus software or that he had licensed it to both Insight and Freight-Check in November 2003.
In early 2004, Aliengena and Brewer discussed Insight's revenues, which were "flat." Brewer urged Aliengena to sell Insight to GetLoaded. On February 6, 2004, Brewer, on behalf of Insight, and Hull, on behalf of GetLoaded, executed a bilateral nondisclosure agreement to give GetLoaded access to Insight's confidential and proprietary information. Trade secrets were defined to include, inter alia, source code, programs, and software. Then, on or about February 25, 2004, Burroughs informed Aliengena of Brewer's involvement in FreightCheck. On March 5, 2004, Hull, on behalf of GetLoaded, issued a letter of intent to Insight, offering to buy the company for $900,000, estimated to be 4.5 times earnings. Both Brewer and Hull actively concealed their ownership and participation in FreightCheck, and Freight-Check's relationship to GetLoaded. Having learned of these relationships from Burroughs, however, Aliengena fired Brewer, and Insight filed this lawsuit on March 17, 2004.
After a hearing, the trial court denied Brewer's motion for summary judgment on Insight's claims for breach of fiduciary duty, appropriation of corporate opportunities, punitive damages, and attorney fees. The trial court granted Brewer's motion for summary judgment on Insight's claims for misappropriation of trade secrets, fraud, and conspiracy to breach fiduciary duty. The trial court granted the remaining appellees' motions for summary judgment on these claims as well as Insight's claims for aiding and abetting breach of fiduciary duty, appropriation of corporate opportunities, punitive damages, and attorney fees.[1] With the exception of the grant of summary judgment in favor of Hull and GetLoaded on Insight's claim for appropriation of corporate opportunities, Insight appeals as to each of these claims and defendants.
1. Insight contends that Georgia law recognizes a claim for aiding and abetting a breach of fiduciary duty. Insight further contends that questions of material fact remain on its claim against Hull, GetLoaded, and FreightCheck for aiding and abetting a breach of fiduciary duty, and, therefore, the trial court erred in granting the motion for summary judgment filed by Hull, GetLoaded, and FreightCheck on Count 1 of the complaint.
(a) The trial court concluded that Georgia has never recognized a claim for aiding and abetting a breach of fiduciary duty, citing Monroe v. Bd. of Regents etc. of Ga., 268 Ga.App. 659, 664-665(2), 602 S.E.2d 219 (2004). In opposing Insight's appeal, Hull, GetLoaded, and FreightCheck contend in addition that, even if Georgia law recognizes such a claim, they cannot be liable because they did not owe any duty to Insight which could form the basis of a tort. In Monroe, we declined to recognize a claim for "aiding and abetting a breach of fiduciary duty" on the record then before us. Id. at 665(2), 602 S.E.2d 219. Because the plaintiff in Monroe "failed to assert such a claim in either his original complaint or by later amendment," however, our holding did not (and could not) reach the issue of whether such a claim is allowable under Georgia law. Id. at 664(2), 602 S.E.2d 219.
Furthermore, we are mindful that there is "no magic in mere nomenclature" in the designation of causes of action. Guth v. Walker, 92 Ga.App. 490, 494, 88 S.E.2d 821 (1955). We must look beyond the designation "aiding and abetting a breach of fiduciary duty" and determine whether Insight's complaint stated a claim which is allowable under Georgia law. Unlike in Monroe, we find that Insight's complaint put the appellees on notice that Insight was asserting a claim that Hull, Get-Loaded, and FreightCheck were joint tortfeasors who acted in concert with Brewer in his breach of fiduciary duty. We hold that Insight has stated a viable claim under OCGA § 51-12-30. That Code section provides: "In all cases, a person who maliciously procures an injury to be done to another, whether an actionable wrong or a breach of *378 contract, is a joint wrongdoer and may be subject to an action either alone or jointly with the person who actually committed the injury." (Emphasis supplied.) By its terms, OCGA § 51-12-30 is inclusive and not limited to particular torts or types of contracts. See Luke v. DuPree, 158 Ga. 590, 596(1), 124 S.E. 13 (1924) (maliciously inducing another to break any type of contract is actionable). Georgia courts have acknowledged a cause of action for procuring an injury or aiding and abetting in a wide array of civil cases, such as an employee's breach of an employment contract's requirement that he give a certain notice before terminating the contract,[2] a former employee's breach of a restrictive covenant in an employment contract,[3] an employer's breach of an employment contract, such as by wrongfully terminating an employee,[4] a client's discharge of his attorney and false repudiation of the attorney's authority to file a suit,[5] a partner's wrongful dissolution of a partnership,[6] a breach of a contract to exchange real property,[7] battery,[8] and trespass to land.[9]
More to the point, we have explicitly acknowledged a cause of action for procuring a breach of fiduciary duty based on OCGA § 51-12-30. In Rome Indust. v. Jonsson, 202 Ga.App. 682, 684(1), 415 S.E.2d 651 (1992) the plaintiff corporation alleged that the defendants induced the corporation's president to breach his fiduciary duty to the corporation. We noted the black letter law "that corporate officers and directors occupy a fiduciary relationship to the corporation and its shareholders, and are held to the standard of utmost good faith and loyalty." (Citation and punctuation omitted.) Id. at 683(1), 415 S.E.2d 651. Because "[t]he fiduciary relationship between a corporation and its officer arises out of the contractual or employment relationship between the two parties," we determined that the claim fell within the category of claims for tortious interference with contractual rights and reversed the decision of the trial court granting summary judgment in favor of the defendants. Id. at 683-684(1), 415 S.E.2d 651.[10] As the Supreme Court of Georgia has explained, "[p]arties to a contract have a property right therein with which a third party cannot interfere without legal justification or privilege, and a party injured by another's wrongful interference may seek compensation in tort" under OCGA § 51-12-30. (Citation omitted.) Atlanta Market Center Mgmt. Co. v. McLane, 269 Ga. 604, 608(2), 503 S.E.2d 278 (1998). Such claims do not require proof that the defendant owed a direct contractual duty to the plaintiff. Rather, a claim for tortious interference with contractual relations requires proof that the defendant is a stranger to the contract with which the defendant allegedly interfered and to the business relationship giving rise to the contract. Pruitt Corp. v. Strahley, 270 Ga. 430, 510 S.E.2d 821 (1999); Atlanta Market Center Mgmt. Co. v. McLane, 269 Ga. at 608-610(2), *379 503 S.E.2d 278.[11]
In summary, regardless of whether denominated "aiding and abetting a breach of fiduciary duty," "procuring a breach of fiduciary duty," or "tortious interference with a fiduciary relationship," Georgia law authorizes a plaintiff to recover upon proof of the following elements: (1) through improper action or wrongful conduct and without privilege, the defendant acted to procure[12] a breach of the primary wrongdoer's fiduciary duty to the plaintiff; (2) with knowledge that the primary wrongdoer owed the plaintiff a fiduciary duty, the defendant acted purposely and with malice and the intent to injure;[13] (3) the defendant's wrongful conduct procured a breach of the primary wrongdoer's fiduciary duty; and (4) the defendant's tortious conduct proximately caused damage to the plaintiff. See Atlanta Market Center Mgmt. Co. v. McLane, 269 Ga. at 608(2), 503 S.E.2d 278; Luke v. DuPree, 158 Ga. at 595-597(1), 124 S.E. 13; Continental Maritime Svcs. v. Maritime Bureau, Inc., 275 Ga.App. 533, 535-536(2), 621 S.E.2d 775 (2005); Rome Industries, Inc. v. Jonsson, 202 Ga.App. at 683-684(1), 415 S.E.2d 651; Arford v. Blalock, 199 Ga.App. 434, 440(13), 405 S.E.2d 698 (1991).
(b) Turning to the issue of whether Insight has identified specific evidence giving rise to a triable issue,[14] we conclude that Insight adduced evidence from which a jury could infer that Hull, acting as an agent of both GetLoaded and FreightCheck, tortiously procured Brewer's breach of his fiduciary duty, damaging Insight. Accordingly, we reverse the trial court's order to the extent that it granted summary judgment in favor of Hull, GetLoaded, and FreightCheck on Count 1 of the complaint. Rome Indust. v. Jonsson, 202 Ga.App. at 683-684(1), 415 S.E.2d 651; Arford v. Blalock, 199 Ga.App. at 442(13), 405 S.E.2d 698.
2. Insight contends that Georgia law recognizes a claim for conspiracy to breach a fiduciary duty and that questions of material fact remain on Count 11 of the amended complaint alleging such a claim against Brewer, Hull, GetLoaded, and FreightCheck. We agree that Georgia law does recognize such a claim. See Luke v. DuPree, 158 Ga. at 595-596(1), 124 S.E. 13; Paul v. Destito, 250 Ga.App. 631, 637-638(3)(4), 550 S.E.2d 739 (2001); Rome Indus. v. Jonsson, 202 Ga.App. at 684(2), 415 S.E.2d 651. Nonetheless, the trial court properly granted summary judgment on Count 11 of the amended complaint because this count as set out is merely a duplication *380 of the breach of fiduciary duty claim set forth in Count 1. See Division 1, supra. Griffin v. Fowler, 260 Ga.App. 443, 446(1), 579 S.E.2d 848 (2003); Rome Indus. v. Jonsson, 202 Ga.App. at 684(2), 415 S.E.2d 651.
3. Insight contends questions of material fact remain regarding whether the FactorPlus software Brewer developed for Insight constituted a trade secret under Georgia law. As a result, Insight contends, the trial court erred in granting the appellees' motions for summary judgment on Count 2 of the complaint, misappropriation of trade secrets. The Georgia Trade Secrets Act of 1990, OCGA § 10-1-760 et seq., authorizes recovery of damages for misappropriation of information "which is not commonly known by or available to the public," which "[d]erives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use," and which "[i]s the subject of efforts that are reasonable under the circumstances to maintain its secrecy." OCGA §§ 10-1-761(4)(A), (B); 10-1-763. "Whether a particular type of information constitutes a trade secret is a question of fact." (Citations omitted.) Camp Creek Hospitality Inns, v. Sheraton Franchise Corp., 139 F.3d 1396, 1410-1411(IV) (11th Cir. 1998) Despite Aliengena's testimony that there was "probably nothing" Insight had which derived its competitive value from not being generally known and not being readily ascertainable by proper means, there was evidence from which a jury could find that the FactorPlus software Brewer developed for Insight satisfied the definition of a trade secret under the Act. Essex Group, Inc. v. Southwire Co., 269 Ga. 553, 554-557(1), 501 S.E.2d 501 (1998); Tronitec, Inc. v. Shealy, 249 Ga.App. 442, 449-450(7)(a, b, c), 547 S.E.2d 749 (2001), overruled on other grounds, Williams Gen. Corp. v. Stone, 279 Ga. 428, 431, 614 S.E.2d 758 (2005); Camp Creek Hospitality Inns, v. Sheraton Franchise Corp., 139 F.3d at 1410-1412 (IV).. Furthermore, there is evidence from which the jury could find that Brewer disclosed the trade secret in violation of the Act, and that Hull, GetLoaded, and Freight-Check knowingly acquired the trade secret through improper means. Accordingly, we reverse the trial court's order to the extent that it granted summary judgment in favor of the appellees on Count 2 of the complaint. Essex Group, Inc. v. Southwire Co., 269 Ga. at 557(1), 501 S.E.2d 501; Tronitec, Inc. v. Shealy, 249 Ga.App. at 449-450(7)(a, b, c), 547 S.E.2d 749; Camp Creek Hospitality Inns v. Sheraton Franchise Corp., 139 F.3d at 1410-1412(IV).
4. Insight contends Brewer acted as FreightCheck's agent when he "breached his fiduciary duties to [Insight] by, among other things, misappropriating the corporate opportunity that was [FreightCheck]." As a result, Insight contends, the trial court erred in granting FreightCheck's motion for summary judgment on Count 4, citing Smith v. Hawks, 182 Ga.App. 379, 355 S.E.2d 669 (1987). To the extent FreightCheck can be held liable for misappropriating itself as a corporate opportunity, this count is merely a restatement of the claim set forth against FreightCheck in the breach of fiduciary duty count. See Divisions 1 and 2, supra. We affirm the trial court's ruling as to Count 4.
5. Insight contends questions of material fact remain regarding whether the appellees committed fraud by "misrepresenting that [GetLoaded's] proposed purchase of [Insight] was to be an arms-length transaction with a good faith purchaser and disinterested seller." As a result, Insight contends, the trial court erred in granting the motion for summary judgment on Count 6 of the complaint.
The tort of fraud has five elements: a false representation by a defendant, scienter, intention to induce the plaintiff to act or refrain from acting, justifiable reliance by plaintiff, and damage to plaintiff. For an action for fraud to survive a motion for summary judgment, there must be some evidence from which a jury could find each element of the tort.
(Citation omitted.) Tharp v. Vesta Holdings I, LLC, 276 Ga.App. 901, 904-905(1)(d), 625 S.E.2d 46 (2005).
It is undisputed that Aliengena learned about the circumstances of the creation of FreightCheck and the relationship *381 among the appellees before Hull sent the March 5, 2004 letter of intent offering to purchase Insight. While the purpose of the fraud was allegedly "to induce Aliengena to sell [Insight] at a depressed price," Aliengena did not rely on the appellees' misrepresentations and agree to the deal. In the absence of evidence of justifiable reliance, the appellees are entitled to judgment as a matter of law on Count 6 of the complaint. Tharp v. Vesta Holdings I, LLC, 276 Ga.App. at 904-905(1) The trial court's judgment in this regard is affirmed.
6. Insight contends questions of material fact remain regarding whether Hull, GetLoaded, and FreightCheck acted with malice such that Insight's claims against them for punitive damages and attorney fees should be submitted to a jury. As to Count 8, Insight's claim for punitive damages, "[p]unitive damages may be awarded only in such tort actions in which it is proven by clear and convincing evidence that the defendant's actions showed willful misconduct, malice, fraud, wantonness, oppression, or that entire want of care which would raise the presumption of conscious indifference to consequences." OCGA § 51-12-5.1(b). As discussed in Division 1, supra, Insight adduced evidence from which a jury could find Hull, GetLoaded, and FreightCheck, liable for procuring a breach of fiduciary duty. Because acting purposefully, with malice and the intent to injure, is an essential element of this tort, it follows that Hull, GetLoaded, and FreightCheck are not entitled to judgment as a matter of law on Counts 8. The trial court's judgment in this regard is reversed.
As to Count 9, Insight's claim for attorney fees pursuant to OCGA § 13-6-11, "[i]t is well established as the law of this state that every intentional tort invokes a species of bad faith and entitles a person so wronged to recover the expenses of litigation including attorney fees. Moreover, bad faith is a question for the jury to be determined from consideration of the facts and circumstances in the case." (Citation and punctuation omitted.) Stargate Software Int. v. Rumph, 224 Ga.App. 873, 878(4), 482 S.E.2d 498 (1997). Because the intentional torts of procuring a breach of fiduciary duty and misappropriation of trade secrets remain for the jury's consideration, see Divisions 1 and 3, "the claim for attorney fees rooted in bad faith concerning those actions should have also been left for the jury. It was premature, and thus error, to grant summary judgment on this issue altogether." Id. Accordingly, the trial court's order in this regard is reversed.
Judgment affirmed in part and reversed in part.
JOHNSON, P.J., and MILLER, J., concur.
NOTES
[1] The trial court also granted summary judgment on Insight's claims for tortious interference with contract, unfair competition, and civil RICO; Insight did not appeal the trial court's ruling on these issues.
[2] Witty v. McNeal Agency, Inc., 239 Ga.App. 554, 560-561(4), 521 S.E.2d 619 (1999).
[3] Williams v. Rio Grande Fence Co., 221 Ga. 633, 635(2), 146 S.E.2d 630 (1966); Nat. Linen Svc. Corp. v. Clower, 179 Ga. 136, 146(6), 175 S.E. 460 (1934); Carroll Anesthesia Assoc. v. Anesthe-Care, Inc., 234 Ga.App. 646, 648-649(1), 507 S.E.2d 829 (1998).
[4] Nottingham v. Wrigley, 221 Ga. 386, 389-391, 144 S.E.2d 749 (1965); Troy v. Interfinancial, Inc., 171 Ga.App. 763, 768-769(2), 320 S.E.2d 872 (1984); Sheppard v. Post, 142 Ga.App. 646, 648(4), 236 S.E.2d 680 (1977).
[5] Studdard v. Evans, 108 Ga.App. 819, 822-824(2), 135 S.E.2d 60 (1964).
[6] Arford v. Blalock, 199 Ga.App. 434, 440-442(13), 405 S.E.2d 698 (1991).
[7] Luke v. DuPree, 158 Ga. at 596(1), 124 S.E. 13.
[8] Joiner v. Lane, 235 Ga.App. 121, 122-124(1)(2)(d), 508 S.E.2d 203 (1998).
[9] Melton v. Helms, 83 Ga.App. 71, 73-75(1), 62 S.E.2d 663 (1950).
[10] See also Nager v. Lad'n Dad Slacks, 148 Ga. App. 401, 403-404(3), 251 S.E.2d 330 (1978) (finding a jury question on a claim for tortious interference with contractual relations under the predecessor to OCGA § 51-12-30 where there was evidence that the defendant tried to drive its competitor out of business by secretly soliciting and hiring away a substantial percentage of the plaintiff's key salesmen, using confidential information and by suggesting to the employees that the plaintiff company was incompetently run and insolvent).
[11] See also Williams v. Svc. Corp. Intl., 218 Ga. App. 10, 459 S.E.2d 621 (1995) (implicitly recognizing a cause of action for aiding and abetting a breach of fiduciary duty); U3S Corp. of America v. Parker, 202 Ga.App. 374, 380(4), 414 S.E.2d 513 (1991) (accord). But see Matter of Munford, Inc., 98 F.3d 604, 613 (11th Cir.1996) (a cause of action for aiding and abetting a breach of fiduciary duty "would enlarge the fiduciary obligations beyond the scope of a confidential or special relationship").
[12] The word "procure" as . . . used [in OCGA § 51-12-30] does not require the lending of assistance in the actual perpetration of the wrong done by another; but if one, acting only through advice, counsel, persuasion, or command, succeeds in procuring any person to commit an actionable wrong, the procurer becomes liable for the injury, either single or jointly, with the actual perpetrator.
(Citations and punctuation omitted.) Melton v. Helms, 83 Ga.App. at 73(1), 62 S.E.2d 663.
[13] As we have held,
[t]he act is malicious when the thing done is with the knowledge of plaintiff's rights, and with the intent to interfere therewith. The term "malicious" or "maliciously" means any unauthorized interference, or any interference without legal justification or excuse. Personal ill will or animosity is not essential. Persuading a person to break a contract for the indirect purpose of injuring the plaintiff or benefiting the defendant at the expense of the plaintiff is a malicious and actionable act if injury arises from it.
(Citations and punctuation omitted.) Arford v. Blalock, 199 Ga.App. at 441(13), 405 S.E.2d 698.
[14] On summary judgment,
[a] defendant who will not bear the burden of proof at trial need only show an absence of evidence to support an essential element of the nonmoving party's case. If the moving party discharges this burden, the nonmoving party cannot rest on its pleadings, but rather must point to specific evidence giving rise to a triable issue.
(Citations and punctuation omitted.) Latson v. Boaz, 278 Ga. 113, 113-114, 598 S.E.2d 485 (2004).
| {
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} |
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
UNITED STATES
v.
Case No. 15-cr-00048 (CRC)
DAVID BRONSTEIN, et al.,
Defendants.
MEMORANDUM OPINION
As James Madison observed long ago, “no language is so copious as to supply words and
phrases for every complex idea, or so correct as not to include many equivocally denoting
different ideas.” The Federalist No. 47, at 225 (James Madison) (C. Rossiter ed., 1963).
Legislatures at all levels have powerfully confirmed Madison’s insight. Yet even if some
imprecision must be tolerated in the vast web of statutes that govern our daily lives, the criminal
law must be sufficiently definite to provide fair notice to those it would punish on society’s
behalf and to cabin the discretion of its appointed peacekeepers and factfinders. The question
before the Court is whether a law prohibiting three separate forms of speech in the Supreme
Court of the United States fulfills these important constitutional requirements.
The defendants are five individuals who stood up and spoke out at the beginning of a
Supreme Court argument session last Term. They were charged with uttering “loud” language
and making a “harangue” or “oration” in the Supreme Court building, all in violation of 18
U.S.C. § 6134. Defendants have moved to dismiss that count of the criminal information filed
against them, challenging each of the above terms as unconstitutionally vague in all of their
applications. With respect to “harangue” and “oration,” the Court agrees—a prosecution under
this language would violate the Due Process Clause. The word “harangue” is not only
anachronistic; its meanings are too imprecise and varied to clearly delineate the prohibited
conduct. The word “oration,” while more common in modern parlance, suffers from similar
definitional ambiguity. Read in isolation, the statute’s prohibition of “loud” utterances also
poses vagueness concerns. But because the term “loud” can be fairly construed as banning only
those utterances that disturb or tend to disturb the normal operations of the U.S. Supreme Court,
the Court will permit Defendants’ prosecution based on that limiting construction.
I. Background
A. The April 1, 2015 Incident
Defendants David Bronstein, Matthew Kresling, Yasmina Mrabet, Belinda Rodriguez,
and Richard Saffle arrived at the Supreme Court on the morning of April 1, 2015 to attend an
oral-argument session. 1 They passed through an initial security checkpoint, entered the Upper
Great Hall, cleared security again, and took their places inside the courtroom. Supreme Court
police officers stood at designated posts throughout the courtroom. After a buzzer indicated that
proceedings would begin in five minutes, Officer Dunford recited the following message to all
assembled:
Welcome to the Supreme Court of the United States. During today’s oral
arguments it is important that you remain seated and silent. When the first case
breaks, please remain silent. If you are remaining for the second case, remain
seated. If you are leaving, silently exit the Courtroom. . . . Please alert one of
the police officers if you observe anything suspicious, and in the event of an
emergency, please remain calm and follow the directions of a police officer.
Thank you.
Govt.’s Opp’n Defs.’ Mot. Dismiss 3 (“Opp’n”). The buzzer sounded again at 10:00 a.m. The
Supreme Court Marshal struck a gavel to inaugurate the day’s proceedings, and three police
1
The following facts are drawn from the Government’s Opposition to Defendants’ Motion to
Dismiss. The Court accepts them as true for purposes of the present motion. See United States
v. Ballestas, 795 F.3d 138, 149 (D.C. Cir. 2015).
2
officers standing in front of the public seating area motioned upward to implore visitors to stand.
As the Justices took the bench, the Supreme Court Marshal intoned a familiar greeting:
The Honorable, the Chief Justice, and the Associate Justices of the Supreme
Court of the United States. Oyez! Oyez! Oyez! All persons having business
before the Honorable, the Supreme Court of the United States, are admonished
to draw near and give their attention, for the Court is now sitting. God save the
United States and this Honorable Court.
Id. The Marshal then gaveled audience members to their seats, and the police officers motioned
downward to indicate that visitors should sit for the remainder of the argument session. By
10:02 a.m., only one member of the audience—Defendant Belinda Rodriguez—remained
standing.
Rodriguez extended her arm in the air and stated, “We rise to demand democracy. One
person, one vote!” Id. A Supreme Court police officer detained Rodriguez and escorted her out
of the courtroom. Moments later, Defendant Kresling arose and stated, “We rise to . . . . Money
is not speech. One person, one vote!” Id. Another police officer detained Kresling and escorted
him away. Next up was Defendant Mrabet, who raised one arm and stated, “Justices, is it not
your duty to protect our right to self-government? The first . . . overturn Citizens United. One
person, one vote!” Id. She, too, was restrained and taken from the courtroom. Defendant Saffle
then initiated a fourth interruption by stating, “Justices, is it not your job to ensure free, fair
elections?” Id. at 5. Saffle’s outburst met the same response. At this point, Chief Justice
Roberts spoke from the bench to warn audience members against further demonstrations:
“Anyone else interested in talking will be admonished that it’s within the authority of this Court
to punish such disturbances by criminal contempt.” Id. Immediately thereafter, Defendant
Bronstein began singing, “We who believe in freedom shall not rest; we who believe in freedom
shall not rest.” Id. Bronstein was detained and escorted out of the courtroom.
3
In all, these verbal interruptions lasted “approximately two to four minutes.” Id. Each
defendant was arrested, and the arresting officers—with the aid of other Supreme Court
employees—processed the defendants elsewhere in the building. All five defendants were
transported to the U.S. Capitol Police station later that day to conclude the arrest process. Two
days later, on April 3, 2015, the U.S. Attorney’s office filed a two-count criminal information
against all five defendants. See Information, ECF No. 1. Count One alleged that each of the
five, “with the intent of interfering with, obstructing, or impeding the administration of justice, or
with the intent of influencing any judge, juror, witness, or court officer in the discharge of their
duties, did demonstrate in or near a building housing a court of the United States,” in violation of
18 U.S.C. § 1507. Count Two charged all five defendants with “[1] unlawfully mak[ing] a
harangue or oration, or [2] utter[ing] loud, threatening, or abusive language in the Supreme Court
Building or grounds,” in violation of 18 U.S.C. § 6134. For the sake of simplicity, the parties
have christened § 6134’s two relevant clauses the “Harangue Clause” and the “Uttering Clause.”
The Court adopts this terminology.
B. Defendants’ Motion to Dismiss
On May 14, 2015, Defendants moved to dismiss Count Two as resting on a facially
unconstitutional statute. They advanced two sets of arguments. First, noting that they had been
charged with violating the Harangue and Uttering Clauses in their entirety, Defendants
contended that select portions of those clauses were unconstitutionally overbroad in violation of
the First Amendment. Because the phrase “Supreme Court . . . grounds” includes the
surrounding sidewalks, which have been held to be a “public forum” for purposes of First
Amendment doctrine—see United States v. Grace, 461 U.S. 171, 180 (1983)—Defendants
claimed that the Harangue and Uttering Clauses restrict too much protected speech and are
4
therefore facially unconstitutional. And second, Defendants argued that both clauses were
unconstitutionally vague on their face so as to violate the Fifth Amendment’s Due Process
Clause. Specifically, they claimed that a prohibition of “loud” language gives visitors “no
criteria . . . to determine whether their speech will be criminal” and “vests too much discretion in
the police.” Defs.’ Mot. Dismiss (“Mot. Dismiss”) 13. The Harangue Clause, too, allegedly
“places unfettered discretion in the police” in criminalizing “harangue[s]” and “oration[s]” in the
Supreme Court building and grounds. Id. at 6.
In its brief in opposition, the Government clarified that it did not intend to prove that
Defendants uttered “threatening” or “abusive” language, or that they violated § 6134 anywhere
in the Supreme Court “grounds” other than the building itself. See Opp’n 14, 17. But rather
than obviate Defendants’ First Amendment challenge by superseding the Information with a
more narrowly tailored charging document, the Government responded in kind. It argued that
Defendants lacked standing to challenge parts of § 6134 that they were not actually accused of
violating and that the Harangue and Uttering Clauses passed muster under conventional First
Amendment forum analysis.
At an oral hearing held on September 29, 2015, the Government agreed to file a
Superseding Information, which it did on October 1, 2015. Count Two now contains no
reference to “abusive” or “threatening” language or the Supreme Court grounds as a whole—it
simply charges Defendants with “unlawfully mak[ing] a harangue or oration or utter[ing] loud
language in the Supreme Court Building.” Superseding Information 2, ECF No. 38. Defendants
subsequently informed the Court that they no longer intended to challenge Count Two on First
Amendment grounds. But they “do continue to urge the Court to [d]ismiss Count Two on
vagueness grounds” as requested in their motion to dismiss. Status Rep. of Oct. 13, 2015, ECF
5
No. 39, at 1. The Court must therefore decide whether the Due Process Clause permits a
prosecution for making a “harangue” or an “oration,” or uttering “loud” language, in the
Supreme Court building.
II. Standard of Review
A criminal defendant “may raise by pretrial motion any defense, objection, or request that
the court can determine without a trial on the merits.” Fed. R. Crim. P. 12(b)(1). Pretrial
motions may challenge “a defect in the indictment or information,” as long as “the basis for the
motion is then reasonably available and the motion can be determined without a trial on the
merits.” Fed. R. Crim. P. 12(b)(3)(B). See, e.g., United States v. Kim, 808 F. Supp. 2d 44, 55–
57 (D.D.C. 2011) (reviewing a criminal defendant’s motion to dismiss an indictment on First
Amendment grounds).
III. Analysis
A. Principles of Constitutional Vagueness Doctrine
Vagueness doctrine is an outgrowth of the Due Process Clause of the Fifth Amendment,
not the First Amendment. United States v. Williams, 553 U.S. 285, 304 (2008). A criminal law
is unconstitutionally vague if it is written so imprecisely “that it fails to give ordinary people fair
notice of the conduct it prohibits,” or is “so standardless that it invites arbitrary enforcement” by
police, prosecutors, and juries. Johnson v. United States, 135 S. Ct. 2551, 2556 (2015). Such
provisions are vague to the extent that they call for “wholly subjective judgments without
statutory definitions, narrowing context, or settled legal meanings.” Williams, 553 U.S. at 306;
see also City of Chicago v. Morales, 527 U.S. 41, 62 (1999) (rejecting the idea of “inherently
subjective” criminal provisions as inimical to due process). Statutes whose interpretation must
be filtered through “individual sensitivities” are especially vulnerable to vagueness challenges,
6
because their meanings are “varying and unascertainable” rather than “principled and objective.”
Big Mama Rag, Inc. v. United States, 631 F.2d 1030, 1037–38 (D.C. Cir. 1980). These notice
and fairness concerns are heightened in the First Amendment context, where “a more stringent
vagueness test should apply.” Holder v. Humanitarian Law Project, 561 U.S. 1, 19 (2010)
(quoting Hoffman Estates v. Flipside, Hoffman Estates, Inc., 455 U.S. 489, 495 (1982)).
Nonetheless, “perfect clarity and precise guidance have never been required even of
regulations that restrict expressive activity.” Ward v. Rock Against Racism, 491 U.S. 781, 794
(1989); see also Grayned v. City of Rockford, 408 U.S. 104, 110 (1972) (“Condemned to the use
of words, we can never expect mathematical certainty from our language.”). All law
enforcement “requires the exercise of some degree of police judgment.” Grayned, 408 U.S. at
114. The reality that virtually all statutes will generate interpretive difficulties at the margins is
addressed not by vagueness doctrine, but by the requirement of proof beyond a reasonable doubt.
Williams, 553 U.S. at 306. Even an “imprecise” criminal law will satisfy due process, then, as
long as it is fundamentally “comprehensible” ex ante. Coates v. City of Cincinnati, 402 U.S.
611, 614 (1971). But there must always be an “ascertainable standard for inclusion and
exclusion.” Smith v. Goguen, 415 U.S. 566, 578 (1974). A criminal prohibition must have some
objective core.
Claimants may bring either as-applied or facial vagueness challenges. The former type
“do not challenge . . . statutory terms in all their applications,” but instead allege invalidity only
insofar as a law prohibits “engaging in certain specified activities.” Humanitarian Law Project,
561 U.S. at 14. With as-applied challenges, courts “consider whether a statute is vague as
applied to the particular facts at issue, for ‘[a] plaintiff who engages in some conduct that is
clearly proscribed cannot complain of the vagueness of the law as applied to the conduct of
7
others.’” Id. at 20 (quoting Hoffman Estates, 455 U.S. at 495) (alteration in original); accord
Parker v. Levy, 417 U.S. 733, 756 (1974) (“One to whose conduct a statute clearly applies may
not successfully challenge it for vagueness.”). This rule “makes no exception for conduct in the
form of speech.” Humanitarian Law Project, 561 U.S. at 20.
Concluding that certain activity “fall[s] comfortably within the scope of” an allegedly
vague statute, id. at 22, does not usurp the jury’s role when courts can find as a matter of law
that the conduct is “plainly prohibited,” id. at 23. If a court determines as a matter of statutory
interpretation that a complainant’s own conduct was criminal, it may not “analyz[e] other
hypothetical applications of the law”—that is, invoke the fair-notice rights of others—to strike
down a statute as vague in all of its applications. Hoffman Estates, 455 U.S. at 495. But such a
disposition is available only if “[a]pplying the statutory terms . . . does not require . . .
untethered, subjective judgments.” Humanitarian Law Project, 561 U.S. at 21; see also id.
(concluding that most of plaintiffs’ proposed activities fit the “narrowing [statutory] definitions”
of the terms “training” and “expert advice or assistance”).
When a complainant whose conduct was not “clearly” proscribed as a matter of law
raises a facial vagueness challenge, the court may properly consider “the vagueness of the law as
applied to the conduct of others.” Hoffman Estates, 455 U.S. at 495. When a court does “hold a
statute to be vague [on its face]” because of its irreducible subjectivity, “it is vague in all its
applications,” even if virtually everyone would agree that “some conduct . . . clearly falls within
the provision’s grasp.” Johnson, 135 S. Ct. at 2561. Accordingly, a legislature may not, for
example, prohibit people from behaving “‘in a manner annoying to persons walking by’—even
though spitting in someone’s face would surely be annoying.” Id. (citing Coates, 402 U.S. at
611). And a merchant charging a thousand dollars for a pound of sugar can successfully
8
challenge a statute criminalizing “unjust or unreasonable rate[s]” as facially vague, even though
virtually no one would characterize such a price as just or reasonable. Id. (citing United States v.
L. Cohen Grocery Co., 255 U.S. 81, 89 (1921)). The fundamental subjectivity of these terms
would preclude a court from holding that any conduct plainly falls within their reach.
Lastly, courts must consider whether a provision is fairly “amenable to a limiting
construction” before striking it down as vague. Skilling v. United States, 561 U.S. 358, 405
(2010); see also id. at 410 (paring potentially vague statutory language down to its “core
applications”); Hoffman Estates, 455 U.S. at 494 n.5 (“In evaluating a facial challenge to a state
law, a federal court must . . . consider any limiting construction that a state court or enforcement
agency has proffered.”). For instance, a “contextual evaluation” of the statutory structure and the
setting in which the relevant behavior occurred may help “determine[] the scope of the
regulation.” United States v. Thomas, 864 F.2d 188, 197 (D.C. Cir. 1988). In some situations,
the text of “a statute written specifically for [a certain] context” may be fairly limited to prohibit
only those activities “impact[ing] . . . the normal activities” of the forum. Grayned, 408 U.S. at
112; see also United States v. Agront, 773 F.3d 192, 197 (9th Cir. 2014) (reasoning that “the
requisite quantum of noise is found by looking to the context in which the regulation applies”).
B. Defendants’ Facial Vagueness Challenges
1. “Loud”
Defendants first claim that the Uttering Clause’s prohibition of “loud” language is
unconstitutionally vague in all of its applications. What of the schoolteacher, Defendants ask,
who realizes that she will need to raise her voice outside the Supreme Court building in order to
instruct her charges amidst the hubbub of First Street? Or the patron of the Supreme Court
cafeteria who wishes to be heard over the clangor of nearby construction? Defendants argue that
9
the word “loud” furnishes visitors “no criteria at all by which to determine whether their speech
will be criminal.” Mot. Dismiss 13. Defendants further complain that the prohibition of “loud”
language “vests too much discretion in the police.” Id. Depending on the sensibilities of the
nearest officer, that provision would allegedly permit the arrest of someone who “briefly crie[d]
out after accidentally dropping a heavy object on his foot,” or a passerby “speaking on the
sidewalk just loudly enough to be heard over the traffic.” Id. at 14. Because Count Two now
charges Defendants with violating the Uttering Clause only in the Supreme Court building, most
of these examples are geographically beside the point. But Defendants have adequately
registered their more general line-drawing concern with the word “loud.”
Whether a criminal statute comports with due process must “be examined in the light of
the conduct with which a defendant is charged.” United States v. Nat’l Dairy Prods. Corp., 372
U.S. 29, 33 (1963). So the question is whether the Uttering Clause’s prohibition of “loud”
language gave Defendants insufficient notice of what the clause criminalized, or invited arbitrary
and standardless law enforcement, in the context of interrupting an oral-argument session at the
Supreme Court. Even with the clause’s parameters thus confined, this is not a case in which the
provision “by [its] terms . . . appl[ies] without question to certain activities,” with marginal or
doubtful cases possible to imagine. Goguen, 415 U.S. at 578. For a court cannot hold that an
impermissibly subjective criminal statute clearly applies to any conduct. The statute does not
define “loud,” nor (so far as the Court is aware) does that adjective have any “settled legal
meaning[].” Williams, 553 U.S. at 306; cf. Humanitarian Law Project, 561 U.S. at 21
(“Congress also took care to add narrowing definitions to the material-support statute over time.
These definitions increased the clarity of the statute’s terms.”). Well-regarded dictionaries
10
define “loud” simply as “[s]trongly audible; making a powerful impression on the sense of
hearing,” 2 and “marked by intensity or volume of sound.” 3
The Court discerns no objective criteria for determining that a noise’s audibility is strong
enough, that the sense of hearing has been subjected to a powerful enough impression, or that a
sound generates sufficient intensity. These uncontroversial definitions of “loud” boil down to an
irreducibly subjective formulation: producing enough volume to cause some set of human beings
to describe it as strongly audible, powerful, or intense. The context at issue here—ongoing
judicial proceedings in which Defendants had been warned to “remain silent,” Opp’n 3—only
deepens this indeterminacy. One police officer might conclude that any verbal communication
qualifies as “loud” in the relative solemnity of a Supreme Court session, whereas another might
believe himself authorized to arrest visitors who shout at the top of their lungs, but not distinctly
audible whisperers and chatterers. It is true that “we can never expect mathematical certainty
from our language.” Grayned, 408 U.S. at 111. But we can expect that our criminal law not
“condition[] . . . liability on confusing and ambiguous criteria.” Colautti v. Franklin, 439 U.S.
379, 394 (1979).
To be sure, § 6134’s prohibition of “loud” language calls for a different sort of subjective
judgment than has been condemned in most of the Supreme Court’s prior vagueness cases.
Under these decisions, legislatures may not criminalize “annoying” behavior, Coates, 402 U.S. at
611, or prosecute as “vagrants” those deemed to be “[r]ogues and vagabonds,” “persons who use
juggling,” “common night walkers,” or “habitual loafers,” Papachristou v. City of Jacksonville,
2
Oxford English Dictionary Online (Sept. 2015), http://www.oed.com/view/Entry/110467?
isAdvanced=false&result=1&rskey=iMLDkO& (last visited Dec. 22, 2015).
3
Merriam-Webster Online Dictionary, http://www.merriam-webster.com/dictionary/loud (last
visited Dec. 22, 2015).
11
405 U.S. 156, 156–57 n.1 (1972). Nor may they prohibit people from treating the U.S. flag
“contemptuously,” Goguen, 415 U.S. at 568; require criminal suspects to provide “credible and
reliable” identification to police officers, Kolender v. Lawson, 461 U.S. 352, 353 (1983); forbid
the electronic transmission of “indecent” communications, Reno v. ACLU, 521 U.S. 844, 871
(1997); or define “loitering” as remaining in one place “with no apparent purpose,” Morales, 527
U.S. at 61. Such amorphous standards transfer policymaking to police and juries with no plainly
proscribed activity from which to analogize. A prohibition of “loud” language at least requires
some baseline level of noise, even if the proscribed decibel range is not marked “with
consummate precision.” Thomas, 864 F.2d at 195. But a statute forbidding “unjust or
unreasonable rate[s]” was struck down in L. Cohen, 255 U.S. at 89, even though some monetary
charge was undoubtedly necessary for criminal liability and the real difficulty lay in determining
exactly which rates were excessive. A prohibition of merely “loud” language—like one on
charging “unjust or unreasonable rate[s]”—simply “has no core.” Goguen, 415 U.S. at 578.
That is not the end of the matter, however. As the Supreme Court has observed, “[i]t has
long been our practice, . . . before striking a federal statute as impermissibly vague, to consider
whether the prescription is amenable to a limiting construction.” Skilling, 561 U.S. at 405. The
Ninth Circuit very recently reviewed—and declined to strike down as vague—a regulation quite
similar to the Uttering Clause. See United States v. Agront, 773 F.3d 192 (9th Cir. 2014). That
regulation prohibited “[d]isorderly conduct which creates loud, boisterous, and unusual noise” on
property under the control of the Department of Veterans Affairs. 38 C.F.R. § 1.218(b)(11). The
regulation also defined “Disturbances” as, among other things, “[c]onduct on property which
creates loud or unusual noise.” Id. § 1.218(a)(5). After concluding that both subsections were
designed “to maintain a calm environment at VA facilities,” the Ninth Circuit held that the
12
regulation prohibited only such noise as “would tend to disturb the normal operation of a VA
facility.” Agront, 773 F.3d at 197. Even though the regulation did “not identify a specific
decibel level,” the court was satisfied that “the normal operation of VA facilities provides an
adequate measure for determining what constitutes prohibited conduct.” Id. at 198. The Ninth
Circuit patterned its opinion on the Supreme Court’s in Grayned v. City of Rockford. Grayned
upheld an ordinance prohibiting “the making of any noise or diversion which disturbs or tends to
disturb the peace and good order of [a] school session.” 408 U.S. at 108. Although the
“prohibited quantum of disturbance [wa]s not specified in the ordinance,” the Supreme Court
concluded that forbidden activities could be “easily measured by their impact on the normal
activities of the school.” Id. at 112.
The Court adopts the same approach here. The Government may prosecute Defendants
for having “utter[ed] loud . . . language in the Supreme Court Building,” but only insofar as their
utterances disturbed or tended to disturb the normal operations of the U.S. Supreme Court. Such
a construction is “fairly possible,” Boos v. Barry, 485 U.S. 312, 331 (1988), and accords with
Congress’s evident intent to preserve the order, decorum, and proper functioning of the nation’s
highest Court.4
4
It is worth noting that this construction of the Uttering Clause overlaps considerably—perhaps
entirely—with Regulation Five of the Supreme Court’s Building Regulations. 40 U.S.C.
§ 6102(a)(2) authorizes the Marshal of the Supreme Court, with the approval of the Chief
Justice, to prescribe regulations “that are necessary for . . . the maintenance of suitable order and
decorum within the Building and grounds.” These regulations carry the same penalties as
violations of the Harangue and Uttering Clauses. 40 U.S.C. § 6137. Regulation Five forbids the
creation of “noise disturbance[s]” within the Supreme Court Building and grounds, defined (in
part) as “any sound that . . . tends to disturb the order and decorum of the Supreme Court.”
Regulation Five, Supreme Court of the United States: Building Regulations, http://www
.supremecourt.gov/publicinfo/buildingregulations.aspx (last visited Dec. 22, 2015). The
existence of Regulation Five does not affect the Court’s holding. The Court would have adopted
its present construction of § 6134 had Regulation Five never been promulgated; it will not
13
2. “Harangue” and “Oration”
No principled limiting device exists to alleviate the vagueness of § 6134’s other contested
terms, “harangue” and “oration.” Section 6134 fails to define either term, and neither one
appears to have a “settled legal meaning[].” Williams, 553 U.S. at 306. The Government has
not cited any case law that might crystallize the words’ ambiguous meanings in the context of a
legal venue like the Supreme Court. From leading dictionaries’ entries on “harangue” and
“oration,” the Court discerns not an objective and neatly isolable core, but a multiplicity of
meanings—many inviting purely subjective reactions—that it cannot referee in any neutral
fashion.
Although § 6134 was passed in the mid-twentieth century, 5 the word “harangue” is
something of an anachronism. It appears in no other federal statute or regulation, civil or
criminal. The various definitions of “harangue” rest largely on subjective assessments of the
nature of the speech involved. The Oxford English Dictionary defines “harangue” as “a speech
addressed to an assembly; a loud or vehement address, a tirade; formerly, sometimes, a formal or
pompous speech.” 6 According to Merriam-Webster, a “harangue” is “a forceful or angry
invalidate an act of Congress merely because the Marshal and Chief Justice have implemented a
broad grant of authority in a way that closely resembles the limiting construction this Court has
placed on § 6134, which was adopted by a separate set of legal actors.
5
1949, to be precise. For a brief history of Congress’s enactment of the set of statutes
regulating conduct in the Supreme Court building and grounds, see Hodge v. Talkin, 949 F.
Supp. 2d 152, 162–63 (D.D.C. 2013), overruled on other grounds by Hodge v. Talkin, 799 F.3d
1145 (D.C. Cir. 2015).
6
Oxford English Dictionary Online (Sept. 2015), http://www.oed.com/view/Entry/84094?rskey
=vY8eQx&result=1#eid (last visited Dec. 22, 2015).
14
speech,” “a speech addressed to a public assembly,” or “a ranting speech or writing.” 7 And
Ballentine’s Law Dictionary defines “harangue” as “[a] noisy, bombastic, ranting speech.” 8
Citing other dictionaries would only compound the uncertainty by expanding the pool of possible
meanings. The Government proposes that the Court exalt one element of one dictionary’s multi-
part entry by deeming the word’s “ordinary definition” to be “a forceful or angry speech.”
Opp’n 29. Even accepting this suggestion, whether certain utterances are “forceful” or “angry”
cannot be determined without reference to subjective perceptions and individual sensitivities.
The same is true of the alternative modifiers “vehement,” “formal,” “pompous,” “ranting,”
“noisy,” and “bombastic.”
Case law on the meaning of “harangue,” such as it is, hardly clarifies its subjective and
multiple dictionary definitions. A state supreme court has reported that a trial judge verbally
reprimanded a defendant who “interrupted the proceedings with verbal protests”—much as
Defendants allegedly did here—for engaging in a “harangue.” Quintana v. Virginia, 295 S.E.2d
643, 651 (Va. 1982). Yet widely varied usages of that word abound. See, e.g., Edwards v. South
Carolina, 372 U.S. 229, 233 (1963) (citing a city manager’s statement that a “religious harangue”
was one element in what he described as a course of “boisterous, loud, and flamboyant conduct”)
(internal quotations omitted); Ognibene v. Parkes, 671 F.3d 174, 199 (2d Cir. 2011) (contrasting
“[p]assing criticisms” with “passionate harangues” by reference to “the intensity of a speaker’s
expression”); White v. Dunlap, 175 F. Supp. 2d 1281, 1284 (D. Kansas 2001) (stating that
someone who allegedly “yell[ed] and scream[ed]” and “ranted for hours” would have engaged in
7
Merriam-Webster Online Dictionary, http://www.merriam-webster.com/dictionary/harangue
(last visited Dec. 22, 2015).
8
Ballentine’s Law Dictionary 548 (3d ed. 1969).
15
a “harangue”); Pennsylvania v. Brown, 164 A. 726, 728 (Pa. 1933) (quoting a jury instruction as
having defined “harangue” as “a noisy, bombastic, ranting speech,” in accordance with
Webster’s New International Dictionary).
The word “harangue” simply has no “unambiguous scope,” Hoffman Estates, 455 U.S. at
494 n.6—no heartland of “paramount applications” to furnish a secure limiting principle,
Skilling, 561 U.S. at 404. There is no indication that Congress “certainly intended the statute to
cover” at least the most narrow definitional formulations of “harangue.” Id. For all the Court
can tell, an additional requirement of pomposity, vehemence, or bombast was meant to
differentiate “harangue” from its clausal neighbor, “oration.” And especially given that “a more
stringent vagueness test” applies to criminal statutes that interfere with First Amendment rights,
Humanitarian Law Project, 561 U.S. at 19 (quoting Hoffman Estates, 455 U.S. at 499), the Court
will not strain to salvage an amorphous criminal provision in the absence of any principled
guidance. The term “harangue” is therefore unconstitutionally vague on its face, and a
prosecution for making one would violate the Due Process Clause. 9
9
The definitional imprecision of “harangue” is exacerbated by the rarity of its use in modern
American English. Google’s Ngram Viewer—which plots the “frequency of usage of selected
words in the aggregate corpus of published books in different historical periods,” Authors Guild
v. Google, Inc., 804 F.3d 202, 217 (2d Cir. 2015)—confirms that “harangue” is somewhat of a
linguistic artifact. According to this fascinating tool, the word’s relative usage peaked in this
country amid the fervent speechifying of the Revolutionary War, and has declined steadily ever
since, with blips in the first and last decades of the nineteenth century. Whereas “harangue”
once vastly overshadowed its kindred nouns “tirade,” “diatribe,” “jeremiad,” and “philippic,”
Ngram Viewer indicates that all five words now appear at a similarly infrequent rate, with
“harangue” (including its verb form) running in second place as of 2008, slightly ahead of
“diatribe.” (A visual representation of the Court’s Ngram search is attached as Appendix A to
this opinion). While the Court does not rest its holding on the word’s dwindling use, these
findings lend some support to the conclusion that § 6134’s ban on harangues does not put today’s
ordinary American on notice of how not to behave in and around the Supreme Court.
16
Section 6134’s prohibition on making an “oration” suffers a similar fate. While the term
is certainly more familiar to the average citizen than “harangue,” it appears (but is not defined) in
only one other federal statute, where making an “oration” is deemed to be a form of
“demonstration” forbidden on certain federal cemetery property. See 38 U.S.C. § 2413. An
accompanying regulation similarly prohibits “[e]ngag[ing] in any orations” on Arlington
National Cemetery grounds. 32 C.F.R. § 553.22(f)(3). The Court has found just one other use of
the word “oration” in a federal regulation—38 C.F.R. § 1.218(a)(14)(ii)’s prohibition of “any . . .
demonstration” on VA property, defined (in part) as “any oration or similar conduct to
assembled groups of people.” The context of these statutes hardly sharpens the term’s
meaning—these usages merely clarify that orations have been understood to qualify as one form
of demonstration, and that orations can be made to assembled groups of people.
The Oxford English Dictionary defines “oration” as “[a] formal discourse delivered in
elevated and dignified language, esp. one given on a ceremonial occasion such as a public
celebration, a funeral, etc.”10 Merriam-Webster’s entry is quite similar: “a formal speech,” or
“an elaborate discourse delivered in a formal and dignified manner.” 11 As with “harangue,” the
Government asserts that a fragment of one of these entries is the word’s “ordinary definition”—
namely, “a formal speech.” The problem with this attempted narrowing is that understandings of
formality are “varying and unascertainable,” because they are inevitably “colored by one’s
attitude[s],” background, and life experiences. Big Mama Rag, 631 F.2d at 1037–38. What
strikes one observer as gruff and unceremonious may seem to another perfectly decorous and
10
Oxford English Dictionary Online (Sept. 2015), http://www.oed.com/view/Entry/132195?
isAdvanced=false&result=1&rskey=gojAyw& (last visited Dec. 22, 2015).
11
Merriam-Webster Online Dictionary, http://www.merriam-webster.com/dictionary/oration
(last visited Dec. 22, 2015).
17
mannerly. There is simply “no value-free measurement” of what characteristics render a manner
of speaking “formal,” id. at 1038, even in the special setting of ongoing judicial proceedings.
The same is true of at least the adjectives “elevated,” “dignified,” and “elaborate.”
The Court’s research has uncovered almost no case law elucidating the meaning of
“oration.” One state supreme court has “supposed” that “‘an oration’ is ‘a public address.’”
Massachusetts v. Gilfedder, 73 N.E.2d 241, 242 (Mass. 1947). And in determining whether a
defendant had “recite[d] an oration,” the City Magistrates’ Court of New York resorted to
consulting the works of Plutarch, Aristophanes, Shakespeare, Tennyson, and Milton in holding
that reading one’s poetry aloud did not constitute “recit[ing] an oration.” People v. Morris, 201
N.Y.S.2d 739, 740–43 (1960); see also id. at 740 (“The Court has looked to the statute and
regulations, as well as the decided cases, and finds no sufficient definition of the term ‘recite an
oration’ to control the instant fact situation. Accordingly, the Court has delved into classical
authorities for assistance in resolving this question.”).
A college literature syllabus is not a penal code. An outspoken “person of ordinary
intelligence,” Williams, 553 U.S. at 304, should not be forced to peruse Paradise Regained—or,
for that matter, obscure and aging state-court decisions—to skirt the criminal law’s sting. Even
if defining “oration” as “a public address” would avert a vagueness challenge (hardly a sure
assumption), that choice would require discarding the Oxford English Dictionary and Merriam-
Webster entries for “oration,” both of which entail something more than vocalization in the
presence of others—namely, a degree of formality or solemnity. Glossing over a word’s central
distinguishing feature would be an act of judicial will, not of principled construction. It is not as
if the “vast majority” of existing authorities embody such a limitation. Skilling, 561 U.S. at 407
(quoting United States v. Runnels, 833 F.2d 1183, 1187 (6th Cir. 1987)).
18
* * *
The Government may proceed under the theory that Defendants uttered “loud” language
that disturbed or tended to disturb the normal operations of the U.S. Supreme Court. But the
terms “harangue” and “oration” are unconstitutionally vague in all of their applications.
Congress has not defined these words, nor has their meaning “evolved over the years from
repeated adjudications.” U.S. Civil Serv. Comm’n v. Nat’l Ass’n of Letter Carriers, AFL-CIO,
413 U.S. 548, 572 (1973). Due process demands greater rigor in deploying the “awful
machinery of the criminal law.” United States v. Kozminski, 487 U.S. 931, 950 (1988) (quoting
United States v. Shackney, 333 F.2d 475, 487 (2d Cir. 1964)). And the Court will not impose a
false consensus on the linguistic community for the sake of constitutional avoidance.
IV. Conclusion
For the forgoing reasons, the Court will grant in part and deny in part Defendants’ motion
to dismiss. A separate order accompanies this Memorandum Opinion.
CHRISTOPHER R. COOPER
United States District Judge
Date: December 22, 2015
19
Appendix A
| {
"pile_set_name": "FreeLaw"
} |
17 Mich. App. 585 (1969)
170 N.W.2d 176
CAVANAGH
v.
CAVANAGH
Docket No. 6,063.
Michigan Court of Appeals.
Decided May 29, 1969.
*586 Piggins, Balmer, Grigsby, Skillman & Erickson for plaintiff.
Buesser, Buesser, Snyder & Blank, for defendant.
BEFORE: McGREGOR, P.J., and R.B. BURNS and DANHOF, JJ.
McGREGOR, P.J.
This appeal disputes a judgment of absolute divorce granted defendant by the circuit court on the ground of extreme cruelty. The court awarded custody of the four oldest boys, aged 14, 13, 12 and 8, to their father, the defendant, and the other four children to their mother, the plaintiff.
The court found that defendant had presented the required proof for a judgment of divorce. Plaintiff contends, however, that statutory grounds for divorce were not established because the primary factors mentioned by the court, namely, the absence of hope for reconciliation and incompatibility, are not sufficient, according to Michigan divorce statutes.
Clearly, incompatibility is not a statutory ground for divorce. Niskanen v. Niskanen (1963), 371 Mich 1. However, since review of divorce judgments is de novo, Buck v. Buck (1948), 320 Mich 624, the total quantum of evidence presented to the lower court may be reviewed. The record contains ample factual support for a finding of extreme cruelty on the part of plaintiff, as pleaded by defendant. Therefore, we are not convinced that we must have reached a different *587 conclusion had we occupied the position of the lower court under like circumstances. Reeves v. Reeves (1952), 335 Mich 193.
Plaintiff controverts the lower court's custody disposition by arguing, first, that the judge should not have relied on the preferences of the three older boys. The trial judge did not rely solely on the wishes of the boys, but was guided by a comprehensive and well-reasoned opinion by the Friend of the Court Referee. The Referee heard six witnesses for the plaintiff and three witnesses for the defendant, as well as the parties themselves. In addition, he had the benefit of a separate report by an investigator for the Friend of the Court. This report, based on three days of testimony, interviews with the children, and independent investigation, recommended that custody of the four older boys be awarded to defendant and that custody of the other four children be awarded to plaintiff. The testimony taken at the Friend of the Court hearings was offered and admitted into evidence at the trial, in its entirety, pursuant to the stipulation of the parties. Thus, it is not apparent that the judge abused his discretion regarding the custody of the three older boys.
Next, plaintiff asserts that the grant of custody of the 8-year-old boy to the father was erroneous, since there is a clear statutory preference for the custody of children under 12 to be awarded to the mother. MCLA § 722.541 (Stat Ann 1957 Rev § 25.311); Paton v. Paton (1961), 363 Mich 192. Defendant responds by arguing that the award of custody is discretionary, with the child's welfare the primary consideration. Arsenault v. Arsenault (1966), 5 Mich App 476. The record indicates that the court determined the custody of the 8-year-old child largely in reference to the Friend of the Court report and its own conclusions as to the best interests *588 of the child. Pursuant to the stipulation of the parties made at trial, the trial judge conferred privately, in chambers, with the five oldest children to assist the court in its determination. The custody determination was proper, as countenanced by Hornbeck v. Hornbeck (1946), 316 Mich 208.
The final issue raised concerns the court's award of support and alimony payments and the disposition of marital property. The court was clearly within its discretion in its disposition of the litigants' property and its determination of payments to be made. Again, we cannot conclude that we would have reached a different conclusion or that the record discloses a manifest abuse of discretion. Billingsley v. Billingsley (1946), 315 Mich 417.
Affirmed. Costs to defendant.
All concurred.
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848 F.2d 1239
U.S.v.DeLeon*
NO. 87-1257
United States Court of Appeals,Fifth Circuit.
MAY 23, 1988
1
Appeal From: N.D.Tex.
2
AFFIRMED.
*
Fed.R.App.P. 34(a); 5th Cir.R. 34.2
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575 N.E.2d 926 (1991)
216 Ill. App.3d 647
159 Ill.Dec. 119
The PEOPLE of the State of Illinois, Plaintiff-Appellee,
v.
Edward G. McNEELEY, Jr., Defendant-Appellant.
No. 3-90-0581.
Appellate Court of Illinois, Third District.
June 20, 1991.
Peter A. Carusona, Office of the State Appellate Defender, Spencer Daniels, Trial Counsel, Ottawa, for Edward Gerald McNeeley, Jr.
Terry A. Mertel, States' Attys. Appellate Prosecutor, Ottawa, Kevin W. Lyons, State's Atty., Peoria, for the People.
Presiding Justice STOUDER.
The defendant, Edward G. McNeeley, Jr., was charged by indictment with unlawful possession of more than 900 grams of cocaine and unlawful possession with intent to deliver more than 900 grams of cocaine (Ill.Rev.Stat.1989, ch. 56½, pars. 1402(a)(11), 1401(a)(11)). Following a jury trial, the defendant was acquitted of those charges but convicted of the lesser included offenses of possession of more than 15 but less than 100 grams of cocaine and possession with intent to deliver more than 15 but *927 less than 100 grams of cocaine (Ill.Rev. Stat.1989, ch. 56½, pars. 1402(a)(2), 1401(a)(2)). The trial court subsequently sentenced him to a term of seven years' imprisonment.
On appeal, we found that Judge Bumgarner had erred in denying the defendant's motion to have a different judge hear his motion for a new trial. Our decision was based on the fact that the motion for a new trial directly attacked Judge Bumgarner's conduct during the reading of the jury verdicts. We therefore remanded the cause with instructions that a different judge would consider the merits of the defendant's motion for a new trial and would conduct a new sentencing hearing if he denied that motion. People v. McNeeley (No. 3-89-0395, Rule 23 Order, filed May 4, 1990).
Following a hearing on remand, Judge McCuskey denied the defendant's motion for a new trial. Judge McCuskey thereafter resentenced him to seven years' imprisonment. The defendant appeals.
The record shows in relevant part that at the defendant's trial the State presented considerable circumstantial evidence showing that the defendant possessed over 900 grams of a substance containing cocaine, along with paraphernalia used in selling cocaine. At the conclusion of the evidence, the jury received instructions on the charged offenses and also on the lesser offenses of possession of more than 15 but less than 100 grams of cocaine and possession with intent to deliver more than 15 but less than 100 grams of cocaine. Following deliberations, the jury returned with four verdicts.
The trial judge read the first two verdicts, which found the defendant not guilty of possession of more than 900 grams of cocaine and not guilty of possession with intent to deliver 900 grams of cocaine. After reading the second not guilty verdict, the judge stated: "And now you know why we can't do much with narcotics, and you're excused. Thank you very much." He then dismissed the jury, left the bench, and went to his chambers.
After learning that he had not read all of the verdicts, the judge returned to the bench and instructed the jury to return to the jury box. The last two verdicts found the defendant guilty of possession of more than 15 but less than 100 grams of cocaine and guilty of possession with intent to deliver more than 15 but less than 100 grams of cocaine. The judge subsequently ordered the jury polled and all of the jurors affirmatively stated that those were the verdicts they had reached. He then apologized to the jury for going off "half-cocked" and discharged them.
At the hearing on remand, bailiff Harry Rohleder testified that he was the bailiff in the courtroom when the events in question occurred. He stated that when the judge made the above-quoted statement, he sounded a little angry. The judge then got up and walked out of the courtroom. Rohleder told the jurors to go into the jury room, which they did. As they were getting ready to leave, the judge asked them to be reseated in the jury box. A minute or two had passed between the time the judge left the bench and when he returned. Rohleder noted that no one went into the jury room with the jurors, and no one talked with them at any time in his presence. He further noted that when the judge initially made his comments and left, the jurors just looked at each other and shrugged or smiled.
Courthouse security officer Kenny Mack testified that after the trial judge read the first two verdicts, he threw down the verdict forms, jumped up, and quickly went into his chambers. The jurors looked upset and started talking among themselves. They then went into the jury room. After one to two minutes, the judge returned. Mack noted that at one point before the judge returned, one or two of the jurors went out the gate that divides the audience from the rest of the courtroom, but were told to come back by the bailiff.
On cross-examination, Mack stated that the jurors were unable to hear anything the assistant state's attorney said to the judge in his chambers. He also noted that although he handcuffed the defendant, it *928 was done outside the sight of anyone in the courtroom. Mack acknowledged that while the events in question were transpiring, he was busy escorting the defendant out of the courtroom and was paying attention to him.
Marcia Straub, the defendant's trial attorney, testified that the judge made the statement in question in a loud angry voice, swung his hands in the air, got up, and literally ran off the bench. She noted that it was possible the jurors heard the defendant expressing his relief to his girlfriend after the first two verdicts were read. Straub also noted that the jurors appeared upset and angry. She and the defendant then walked out of the courtroom. At the time, the jurors were talking to each other in the jury room and the bailiff was with them. When the judge returned after about three minutes, the jurors were still in the jury room or coming back into the jury box. She did not see any of them anywhere else.
Deputy circuit clerk Linda Smiddy testified that she was clerking for the trial judge at the time. After the judge read two of the verdicts, he handed all four forms to her and left the courtroom. She immediately went after him and handed him the four verdict forms, telling him he had failed to read two of them. No more than two minutes passed between the time he left and when he returned. When she and the judge returned to the courtroom, the jurors were scattered, but were all in the room.
The motion judge found that there was no evidence the trial judge's comments had prejudiced the defendant, coming as they were after the jury had returned unanimous verdicts. The judge noted that the jury's deliberations were uneventful and that the defendant had presented no direct evidence that the polling process was tainted in any way.
On appeal, the defendant argues that he was denied his right to properly poll the jury on the guilty verdicts because the trial judge's statements and conduct insured that no juror would voice any dissent with respect to the verdicts.
The purpose of polling a jury is to determine that the verdict accurately reflects each juror's vote as reached during deliberations and that the jurors' votes were not the result of force or coercion. (People v. Williams (1983), 97 Ill.2d 252, 73 Ill.Dec. 360, 454 N.E.2d 220.) For the comments of a judge to constitute reversible error, the defendant must show that the remarks were prejudicial and that he was harmed by them. (People v. Garcia (1988), 169 Ill.App.3d 618, 120 Ill.Dec. 81, 523 N.E.2d 992.) The mere possibility of harm to the defendant is not sufficient grounds for holding that a jury poll was improper. People v. Chandler (1980), 88 Ill.App.3d 644, 44 Ill.Dec. 314, 411 N.E.2d 283.
Here, the defendant's appeal argument is necessarily speculative, since there was no direct evidence that any juror was precluded from voicing his dissent due to the trial judge's behavior. While it is certainly possible to envision situations where a judge's behavior would mandate a presumption that he had improperly influenced the jury polling, this is not such a case. The instant judge's actions, while improper, left a question of fact as to whether the jury polling had been tainted. The judge hearing the motion for a new trial determined from the evidence presented that the defendant had failed to meet his burden of showing that the polling was tainted. While that evidence included some testimony that the jurors were upset and scared by the judge's outburst, it also included testimony indicating that the jurors were unfazed by the outburst. Under these circumstances, we find that the motion judge did not abuse his discretion in finding that the defendant was not entitled to a new trial.
The defendant further argues that it was reversible error to receive the jury's guilty verdict after the jury was discharged and the court had lost control of it. He relies upon People v. DeStefano (1965), 64 Ill.App.2d 389, 212 N.E.2d 357, where the trial court improperly accepted a guilty verdict after declaring a mistrial. In DeStefano, the jury foreman told the court the jury could not reach a verdict. The court declared *929 a mistrial and released the jurors, who left the box, returned to the jury room, and engaged in conversation with the bailiff and an assistant state's attorney. The court then learned that the jury had in fact found the defendant guilty with respect to one charge and was hung only as to a second charge. After the bailiff retrieved the signed guilty verdict form from the jury room, where it had been left, the trial court accepted the verdict. The appellate court reversed, holding that the trial court had lost control of the jury and that the integrity of the verdict was called into question.
In cases of this type, the pivotal question is whether the trial court lost control of the jury, i.e., whether the protective shield which must surround a jury was removed, allowing the jurors to be influenced by improper outside factors. (People v. Gale (1971), 132 Ill.App.2d 986, 271 N.E.2d 94.) Here, unlike DeStefano, we note that either the judge or the deputy circuit clerk retained control over all the signed verdict forms throughout the events in question. Further, the judge hearing the motion for a new trial could have properly concluded from the evidence that the court never lost control of the jurors. One witness indicated the jurors might have heard the defendant talk with his girlfriend. Another witness, who admitted that he was paying more attention to the defendant than to the jurors, indicated that one or two jurors might have gone through the gate. The bulk of the evidence showed, however, that the jurors simply went back to the jury room by themselves, then returned to the jury box when the judge returned. Under these circumstances, the motion judge could have properly concluded that the jurors were subjected to no improper outside influences.
Accordingly, the judgment of the circuit court of Peoria County is affirmed.
Affirmed.
BARRY and GORMAN, JJ., concur.
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91 F.3d 155
NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel.UNITED STATES of America, Plaintiff-Appellee,v.Jose Carlos CASTRO-BARRAZA, Defendant-Appellant.
No. 95-10302.
United States Court of Appeals, Ninth Circuit.
Submitted June 10, 1996.Decided July 29, 1996.
1
Before: REINHARDT and HALL, Circuit Judges, and MERHIGE, Senior District Judge.*
2
MEMORANDUM**
3
Jose Carlos Castro-Barraza was convicted of possession of marijuana with intent to distribute in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B)(vii). He appeals the district court's denial of his motion, made prior to trial, for disclosure of information relevant to calculation of his sentence under the Guidelines; the district court's denial of his motion for acquittal based on the insufficiency of the evidence; the district court's determination that he did not qualify for the U.S.S.G. § 5C1.2 "safety valve" exception to the minimum sentence; and the district court's determination that he was not entitled to a downward adjustment in his sentence based on acceptance of responsibility.
4
A. Motion for Disclosure of Guideline Information
5
Castro Barraza appeals the district court's denial of his motion, styled "Motion for Disclosure of Guideline Sentencing Information," filed pursuant to Rule 16 of the Federal Rules of Criminal Procedure.
6
Castro-Barraza asserts that Rule 16 entitled him to discovery prior to trial of any and all information in the possession of, or available to, the Government concerning his status under the Sentencing Guidelines.
7
Federal Rule of Criminal Procedure 16(a)(1)(B) provides:
8
Upon request of the defendant the government shall furnish to the defendant such copy of the defendant's prior record, if any, as is in possession, custody, or control of the government, the existence of which is known, or by the exercise of due diligence may become known, to the attorney for the government.
9
In this case, the Government did not come into possession of information concerning Castro-Barraza's 1994 concealed weapon conviction until the pre-sentence report was prepared subsequent to Castro-Barraza's conviction. This Court has stated that a prosecutor fulfills his duty of discovery and disclosure under Rule 16(a)(1)(B) by revealing the defendant's record of prior convictions and any F.B.I. rap sheet. U.S. v. Trejo-Zambrano, 582 F.2d 460, 465 (9th Cir.1978); see also United States v. Audelo-Sanchez, 923 F.2d 129, 130 (9th Cir.1991) (holding that government was not required to reveal speeding ticket because minor offenses do not appear on defendant's criminal record). The absence of the September 1994 state gun violation from the settlement conference report did not violate Rule 16 because the conviction, due to its recent nature, was not yet on Castro-Barraza's record, as made available to the probation officer in the ordinary performance of his duties. In light of the practical realities involved in gathering information needed to sentence a defendant under the guidelines, the Court declines to construe Rule 16 to create an obligation on the part of the Government to provide greater information than is available to the Probation Department in the course of the regular performance of its duties.
10
B. Sufficiency of Evidence to Prove Violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B)(vii)
11
To sustain a conviction for possession of marijuana with intent to distribute it, "the government must prove that the defendant (1) knowingly (2) possessed the marijuana (3) with intent to distribute it." See United States v. Quintero-Barraza, 78 F.3d 1344, ---- (9th Cir.1995).
12
In this case Castro-Barraza testified at trial that he was the passenger and knew that there was a large amount of marijuana in the Dodge Caravan. He also admitted that he had told Agent Fresquez that he was the driver at the time of the arrest. The testimony of Agent Fresquez, Mary Vanover and Mary Archibald concerning the clothing of the driver and passenger of the Caravan, as well as the direction of their flight, was not inconsistent with a conclusion that Castro-Barraza was the driver. Thus, when reviewing the evidence in the light most favorable to the prosecution, the jury could have found that Castro-Barraza was driving a vehicle containing 430 pounds of marijuana which he was to deliver to another individual, fled when followed by a law enforcement officer, and gave contradictory stories to explain his actions. These facts support a conviction of possession of marijuana with intent to distribute it. See Id. See also United States v. Haro-Portillo, 531 F.2d 962, 963 (9th Cir.1976) ("when one drives a car laden with contraband, there is a substantial basis from which the trier of fact may infer that the driver has knowing possession of the contraband").
13
C. Qualification for the U.S.S.G. § 5C1.2 "Safety Valve" Exception
14
U.S.S.G. § 5C1.2 provides that the district court "shall impose a sentence in accordance with the applicable guidelines without regard to any statutory minimum, if the court finds that the defendant meets" five statutory criteria. One such criteria is that the defendant "not have more than 1 criminal history point, as determined under the sentencing guidelines." 18 U.S.C. § 3553(f)(1). Castro-Barraza challenges the district court's inclusion of his 1994 state weapons possession charge in the calculation of his criminal history points. If the weapons charge is included, Castro-Barraza is ineligible for the U.S.S.G. § 5C1.2 "safety valve."
15
U.S.S.G. § 4A1.2(a)(1) provides that "[t]he term 'prior sentence' means any sentence previously imposed upon adjudication of guilt, whether by guilty plea, trial, or plea of nolo contendere for conduct not part of the instant offense." Castro-Barraza urges, as he did below, that the 1994 weapons charge should not have counted because the conviction was invalid under Arizona law because it resulted in a suspended sentence and forfeiture of the weapon--a combination that Castro-Barraza asserts does not accord with Arizona law.
16
The district court rejected Castro-Barraza's arguments. The Court concludes that the district court did not err in counting Castro-Barraza's 1994 state conviction for carrying a concealed weapon towards his criminal history where Castro-Barraza's record indicated a valid conviction and where the district court heard testimony from the Arizona magistrate that the magistrate had found Castro-Barraza guilty of carrying a concealed weapon. Furthermore, Guideline § 4A1.2 does not provide a basis to challenge the validity of a prior conviction. U.S. v. Price, 51 F.3d 175, 177-178 (9th Cir.1995).
17
D. Adjustment Based on Acceptance of Responsibility
18
U.S.S.G. § 3E1.1 authorizes a two-point reduction in the base offense level "[i]f the defendant clearly demonstrates acceptance of responsibility for his offense. The burden is on the defendant to "clearly" show that he is deserving of the reduction. United States v. Alexander, 48 F.3d 1477, 1493 (9th Cir.1995).
19
In this case Castro-Barraza put the government to its proof at trial. While a defendant's decision to exercise his right to trial does not automatically render him ineligible for a reduction for acceptance of responsibility, such a situation is rare. Id. at 1494. Here, Castro-Barraza has gone beyond asserting a defense of duress and has challenged the sufficiency of the evidence establishing his possession of the drugs at trial and on appeal. Cf. U.S. v. Ing, 70 F.3d 553, 555-556 (9th Cir.1995) (trial court erred in denying defendant a reduction for acceptance of responsibility where there was nothing to identify such a failure other than the assertion of an entrapment defense at trial). Furthermore, Castro-Barraza either lied at the time of his arrest or during his trial testimony. Finally, Castro-Barraza's presentence report indicates the probation officer's conclusion that "[t]he defendant ... attempts to minimize his participation [in the offense]." In light of the foregoing, the Court concludes that the district court's determination that Castro-Barraza was not entitled to the two-point reduction for acceptance of responsibility was not clearly erroneous.
20
The Court AFFIRMS Castro-Barraza's conviction for possession of marijuana with intent to distribute in violation of 21 U.S.C. § 841(a)(1) and (b)(1)(B)(vii) and the sentence imposed.
*
The Honorable Robert R. Merhige, Jr., Senior United States District Judge for the Eastern District of Virginia, sitting by designation
**
This disposition is not suitable for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3
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10-622-ag
Pan v. Holder
BIA
Hom, IJ
A088 377 874
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER
FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF
APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER
IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY
ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
1 At a stated term of the United States Court of Appeals
2 for the Second Circuit, held at the Daniel Patrick Moynihan
3 United States Courthouse, 500 Pearl Street, in the City of
4 New York, on the 16th day of March, two thousand eleven.
5
6 PRESENT:
7 ROSEMARY S. POOLER,
8 RICHARD C. WESLEY,
9 PETER W. HALL,
10 Circuit Judges.
11 ______________________________________
12
13 QIAO YUN PAN,
14 Petitioner,
15
16 v. 10-622-ag
17 NAC
18 ERIC H. HOLDER, JR.,
19 UNITED STATES ATTORNEY GENERAL,
20 Respondent.
21 ______________________________________
22
23 FOR PETITIONER: James Costo, Law Office of James
24 Costo, Brooklyn, New York.
25
26 FOR RESPONDENT: Loretta E. Lynch, United States
27 Attorney; Varuni Nelson, Scott Dunn,
28 Margaret M. Kolbe, Assistant United
29 States Attorneys; Dione M. Enea,
30 Special Assistant United States
31 Attorney, Of Counsel; Eastern
32 District of New York, Brooklyn, New
33 York.
1 UPON DUE CONSIDERATION of this petition for review of a
2 Board of Immigration Appeals (“BIA”) decision, it is hereby
3 ORDERED, ADJUDGED, AND DECREED, that the petition for review
4 is DENIED in part and DISMISSED in part.
5 Qiao Yun Pan, a native and citizen of the People’s
6 Republic of China, seeks review of a January 26, 2010, order
7 of the BIA affirming the April 22, 2008, decision of
8 Immigration Judge (“IJ”) Sandy K. Hom, pretermitting her
9 application for asylum and denying her applications for
10 withholding of removal and relief under the Convention
11 Against Torture (“CAT”). In re Qiao Yun Pan, No. A088 377
12 874 (B.I.A. Jan. 26, 2010), aff’g No. A088 377 874 (Immig.
13 Ct. N.Y. City Apr. 22, 2008). We assume the parties’
14 familiarity with the underlying facts and procedural history
15 in this case.
16 Under the circumstances of this case, we review the
17 decision of the IJ as supplemented by the BIA. See Yan Chen
18 v. Gonzales, 417 F.3d 268, 271 (2d Cir. 2005) The
19 applicable standards of review are well-established. See
20 8 U.S.C. § 1252(b)(4)(B); Yanqin Weng v. Holder, 562 F.3d
21 510, 513 (2d Cir. 2009).
22
2
1 I. Asylum
2 Title 8, Section 1158(a)(3) of the United States Code
3 provides that no court shall have jurisdiction to review the
4 agency’s finding that an asylum application was untimely
5 under 8 U.S.C. § 1158(a)(2)(B), or its finding of neither
6 changed nor extraordinary circumstances excusing the
7 untimeliness under 8 U.S.C. § 1158(a)(2)(D). While the
8 courts retain jurisdiction, under 8 U.S.C. § 1252(a)(2)(D),
9 to review constitutional claims and “questions of law,” Pan
10 has challenged only the agency’s factual determination that
11 she failed to demonstrate extraordinary circumstances.
12 Accordingly, we dismiss Pan’s petition for review to the
13 extent it challenges the agency’s pretermission of her
14 asylum application. See Xiao Ji Chen v. U.S. Dep’t of
15 Justice, 471 F.3d 315, 329-331 (2d Cir. 2006).
16 II. Withholding of Removal and CAT Relief
17 The agency reasonably determined that Pan did not
18 suffer past persecution based on her membership in an
19 underground Roman Catholic church in China given that the
20 only harm she suffered was loss of her job and instruction
21 to register with an authorized church. See Ivanishvili v.
22 U.S. Dep’t of Justice, 433 F.3d 332, 341 (2d Cir. 2006)
23 (stating that the harm must rise above “mere harassment”);
3
1 accord Guan Shan Liao v. U.S. Dep’t of Justice, 293 F.3d 61,
2 67 (2d Cir. 2002); Matter of T-Z-, 24 I.&.N. Dec. 163, 172-
3 73 (BIA 2007) (economic harm must be “severe,” such that it
4 would “constitute a threat to an individual’s life or
5 freedom”). The record also supports the BIA’s determination
6 that Pan failed to demonstrate an objective fear of future
7 persecution, as the evidence showed that although China has
8 engaged in discrimination and abuse against Christians, Pan
9 failed to establish that the restrictions were severe enough
10 to constitute a likelihood a persecution. See Siewe v.
11 Gonzales, 480 F.3d 160, 167 (2d Cir. 2007); Xiao Ji Chen v.
12 U.S. Dep’t of Justice, 471 F.3d 315, 342 (2d Cir. 2006).
13 Substantial evidence also supports the agency’s
14 determination that Pan failed to establish a clear
15 probability of future persecution based on the birth of her
16 two children. We have previously reviewed the BIA’s
17 consideration of the State Department reports and family
18 planning regulations submitted in this case and have found
19 no error in its conclusion that such evidence was
20 insufficient to establish an objectively reasonable fear of
21 persecution. See Jian Hui Shao v. Mukasey, 546 F.3d 138,
22 169-72 (2d Cir. 2008) (“[U]nattributed ‘reports’ of forced
23 sterilization that lack[] any specificity as to number or
24 circumstance . . . d[o] not, by themselves, persuasively
4
1 demonstrate a reasonable possibility that [an applicant]
2 would face such persecution.”).
3 Because Pan was unable to establish the objective
4 likelihood of persecution needed to make out a withholding
5 of removal claim based on either her religion or the births
6 of her two children, she was necessarily unable to establish
7 a likelihood of torture. See Paul v. Gonzales, 444 F.3d
8 148, 155-56 (2d Cir. 2006). To the extent Pan asserts that
9 she will be tortured as a “returning illegal emigrant,” she
10 has pointed to no specific evidence that similarly situated
11 individuals are tortured when returned to China. But see
12 Mu-Xing Wang v. Ashcroft, 320 F.3d 130, 143-44 (2d Cir.
13 2003) (holding that the relevant inquiry is whether someone
14 in the applicant’s particular circumstances would be
15 persecuted upon return to China because of an illegal
16 departure).
17 For the foregoing reasons, the petition for review is
18 DENIED in part and DISMISSED in part. As we have completed
19 our review, any stay of removal that the Court previously
20 granted in this petition is VACATED, and any pending motion
21 for a stay of removal in this petition is DISMISSED as moot.
22
23
24
5
1 Any pending request for oral argument in this petition is
2 DENIED in accordance with Federal Rule of Appellate
3 Procedure 34(a)(2), and Second Circuit Local Rule 34.1(b).
4 FOR THE COURT:
5 Catherine O’Hagan Wolfe, Clerk
6
6
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In The
Court of Appeals
Sixth Appellate District of Texas at Texarkana
No. 06-14-00022-CV
DENCO CS CORPORATION, Appellant
V.
BODY BAR, LLC, Appellee
On Appeal from the 429th District Court
Collin County, Texas
Trial Court No. 429-01020-2013
Before Morriss, C.J., Carter and Moseley, JJ.
Opinion by Justice Moseley
OPINION
Body Bar, LLC, desired to open an upscale Pilates studio and juice bar in Plano, Texas. 1
Toward that aim, Body Bar entered into a lease for commercial property owned by Regency
Centers, L.P., the lease acknowledging that it would be Body Bar’s responsibility to construct the
studio within the demised space and providing that Regency would pay $25,000.00 of the cost of
doing so after the successful completion of the construction project. Body Bar had its plans and
specifications for the improvements drafted by an outside consultant and included those plans
and specifications in its advertisement for bids to accomplish the work. Denco CS Corporation
responded to the advertisement for bids and was awarded the contract for the improvements as
Body Bar’s contractor. On March 25, 2012, Denco and Body Bar entered into a contract to
complete the project.
Denco’s completion of the project was delayed, in part, due to the city’s determination
that portions of the plans and specifications for the project failed to meet the city’s health code.
In order to complete the project with as little delay as possible, Denco’s crewmen worked
overtime and on weekends, thereby increasing Denco’s cost for the project by $28,933.40.
Denco attempted to pass this cost along to Body Bar via an e-mail request for additional sums.
Believing that its contract with Denco did not obligate it to pay more on the contract due to
Denco’s decision to employ crewmen outside of normal business hours, Body Bar—which had
paid each contractually prescribed invoice Denco submitted—did not acquiesce to Denco’s
1
Originally appealed to the Fifth Court of Appeals in Dallas, this case was transferred to this Court by the Texas
Supreme Court pursuant to its docket equalization efforts. See TEX. GOV’T CODE ANN. § 73.001 (West 2013). We
follow the precedent of the Fifth Court of Appeals in deciding this case. See TEX. R. APP. P. 41.3.
2
request for additional sums. In response, Denco took the steps it felt were necessary to perfect
contractor’s liens under both the statutory scheme and the Texas constitutional contractor’s lien
on the property it had improved. These liens were supported by the affidavit of Denco’s Director
of Construction, Steven J. Smith, and stated, in part, that “the amount of $28,933.40 . . . remains
unpaid and is due and owing to [Denco] under its agreement with Body Bar.” 2
Some two months after Denco and Body Bar entered into the construction agreement,
Regency sold the premises to Bre Throne Preston Park, LLC, which purchased the property
subject to Body Bar’s lease and the obligations of the landlord thereunder—including the
responsibility of the lessor to reimburse Body Bar $25,000.00 of the cost of the improvements it
made to the property. When Bre Throne discovered the existence of the lien affidavits filed by
Denco, it withheld its reimbursement to Body Bar of the $25,000.00 specified in the lease
agreement. When Bre Throne refused to pay the reimbursement, Body Bar filed suit against
Denco.
In its suit seeking declaratory relief, Body Bar’s petition (1) set out the existence of the
contractual relationship into which it had entered with Denco; (2) alleged that Denco had
breached its contract with Body Bar by requesting additional sums not contemplated to be paid
by Body Bar under the contract; (3) requested the trial court to declare that the affidavits filed by
Denco did not effectuate liens on the improved property because (a) Denco failed to provide the
required statutory notice, (b) Denco failed to file its lien affidavits within the prescribed time,
and (c) the lien affidavits were ineffective to affix a lien on the property because Denco had no
2
See TEX. PROP. CODE ANN. § 53.021 (West Supp. 2014).
3
privity of contact with Bre Thorne, the owner of the realty; (4) alleged that Denco’s act in filing
fraudulent lien affidavits tortiously interfered with Body Bar’s lease with Bre Throne, causing
damages in the amount of the $25,000.00 reimbursement prescribed in the lease agreement; and
(5) sought to recover Body Bar’s attorney fees.
Denco responded by filing counterclaims of its own, these counterclaims seeking relief
for the alleged breach of contract, quantum meruit, unjust enrichment, and attorney fees, together
with the relief of allowing it to foreclose the mechanic’s liens it alleged that it held.
Body Bar filed a combination traditional and no-evidence motion for summary judgment.
After reviewing the summary judgment evidence, the trial court (1) ruled that neither the
constitutional mechanic’s lien nor the statutory mechanic’s lien alleged by Denco were valid and
that neither was subject to foreclosure; (2) determined that Denco had breached its contract with
Body Bar, that Denco was guilty of tortious interference with Body Bar’s contract with its lessor,
and that Denco was not entitled to recovery under its claim of quantum meruit or unjust
enrichment; 3 and (3) granted Body Bar recovery of $25,000.00 in damages, $16,451.00 in
attorney fees and $491.00 in costs. Denco appeals the trial court’s ruling.
In this case, we find that the summary judgment evidence (1) conclusively established
that the statutory and constitutional liens were invalid, (2) conclusively established that Body Bar
was entitled to summary judgment on all of Denco’s claims, (3) failed to conclusively establish
that Body Bar sustained damages as a result of Denco’s breach, and (4) failed to conclusively
establish tortious interference with the lease with Bre Thorne as a matter of law. In short, Body
3
See further discussion below.
4
Bar established its entitlement to summary judgment on its declaratory judgment and breach of
contract claim as a matter of law. However, while Body Bar proved that Bre Thorne withheld
reimbursement due to the invalid liens filed on the premises, Body Bar failed to prove that
Bre Thorne would not pay the reimbursement once the liens were invalidated. Thus, while Body
Bar demonstrated that it sustained some damage (including interest on the reimbursement had it
been timely paid), the amount of damages actually sustained in light of our opinion remains
speculative. 4
We further find (1) that Denco could not foreclose invalid liens, (2) that Denco failed to
raise a genuine issue of material fact demonstrating that Body Bar was contractually obligated to
pay the additional sums requested by Denco, and (3) that Denco’s equitable claims of unjust
enrichment and quantum meruit were precluded as a matter of law because the labor used to
complete the project was covered by the contract price. Because Denco failed to raise more than
a scintilla of evidence on any of its claims, the trial court’s no-evidence motion for summary
judgment was proper.
We affirm the trial court’s judgment in part, but reverse (1) the finding that Body Bar
established tortious interference as a matter of law, (2) the finding that Body Bar established
breach of contract as a matter of law, and (3) the award of $25,000.00 to Body Bar, and remand
these matters to the trial court for further proceedings consistent with this opinion.
4
We find that the amounts of attorney fees and costs were conclusively established by an affidavit filed by Body
Bar’s counsel.
5
I. Standard of Review
“We apply well-known standards in our review of traditional and no-evidence summary
judgment motions.” W. Fork Advisors, LLC v. SunGard Consulting Servs., LLC, No. 05-13-
01289-CV, 2014 WL 3827937, at *2 (Tex. App.—Dallas Aug. 5, 2014, no pet. h.) (citing Timpte
Indus., Inc. v. Gish, 286 S.W.3d 306, 310 (Tex. 2009); Nixon v. Mr. Prop. Mgmt. Co., 690
S.W.2d 546, 548 (Tex. 1985)). “With respect to a traditional motion for summary judgment, the
movant has the burden to demonstrate that no genuine issue of material fact exists and it is
entitled to judgment as a matter of law.” Id. (citing TEX. R. CIV. P. 166a(c); Nixon, 690 S.W.2d
at 548–49). “We review a no-evidence summary judgment under the same legal sufficiency
standard used to review a directed verdict.” Id. (citing TEX. R. CIV. P. 166a(i); Gish, 286 S.W.3d
at 310). “To defeat a no-evidence summary judgment, the nonmovant is required to produce
evidence that raises a genuine issue of material fact on each challenged element of its claim.” Id.
(citing Gish, 286 S.W.3d at 310; see TEX. R. CIV. P. 166a(i)). “Within the framework of these
standards, we review the trial court’s summary judgment de novo.” Id. (citing Travelers Ins. Co.
v. Joachim, 315 S.W.3d 860, 862 (Tex. 2010)).
II. The Summary Judgment Evidence
Denco provided Body Bar with a proposed estimate, which (1) extensively detailed the
work Denco would complete on the project, (2) included Denco’s overhead, (3) in a document
titled “General Conditions,” included an estimate for “Lump Sum” “Labor Burden,” and ten
hours of “Miscellaneous Labor,” and (4) provided $123,841.81 as the total cost for the project.
When Denco won the bid, its bid proposal was incorporated into the contract with Body Bar.
6
The contract stated, “Only work explicitly listed in the Proposal is included. All other work is
excluded. [Body Bar] shall request any clarification needed regarding the scope of work
included in the Proposal.” The contract further explained, “Request for work in addition to the
Proposal may be completed, and, even without a signed Change Order, will result at an
additional cost to [Body Bar].” The contract also set forth the following payment schedule:
“Payment shall be made as follows: 30% After demo and underground plumb / 30% After wall
inspections / 30% Up building / Final 10% upon move in . . . .”
Denco began work on the project on June 11, 2012. According to the terms of the
contract’s payment schedule, Denco delivered Body Bar the first $37,152.54 invoice on June 25,
the second $44,493.29 invoice on July 25, and the third $24,768.37 invoice on August 28, 2012. 5
Body Bar paid each of these invoices in full.
Denco’s contract with Body Bar also stated, “Unless specified elsewhere in the Contract
Documents, liquidated damages for work not completed on time shall not exceed $100 per day.”
The projected opening date for the studio was August 4, 2012. On July 25, 2012, Emilie Shaulis,
Denco’s office manager, e-mailed a delay log to Alison Bradley, human resources manager for
Body Bar. The delay log indicated a 152-day delay and listed reasons for the delay that were
outside of Denco’s control. A July 27, 2012, e-mail from Denco informed Body Bar and its
design team that the “structure over juice bar,” exposed beams, and “ledgerstone accent band” in
the bathrooms failed the city’s health inspection because they could not easily be wiped clean.
On August 1, 2012, Denco’s President, Mark L. Boland, sent an e-mail to Body Bar’s design
5
Pursuant to an approved change order, Denco billed an additional $1,368.21 on August 1, and Body Bar paid the
amount on August 22, 2012.
7
team stating, “A week ago I said we could complete in 3 weeks. That date will slip if materials
cannot be delivered and design issues resolved in timely fashion.” The studio was opened on or
about September 7, 2012, thirty-four days past the August 4 projected opening date.
On September 13, 2012, after Denco had completed the project, Shaulis sent the
following e-mail to Bradley:
As a result of the delays on the Body Bar, Plano, TX, Denco has suffered
financially. We are asking for you to review the attached documents and please
consider additional compensation.
. . . . As you can see the delays . . . only extend[ed] us 34 days past the original
opening date. In cost for General Conditions we have calculated for the 34 days
past the August 4, Opening Date. However our labor is much more extensive as
we had a crew of 4 men working over 8 hours a day and Saturdays and Sundays.
General Conditions for Days Past Original Schedule -$180.72 x34 days $6,144.48
. . . Normal hours -$17.00per Hr x 4men=$68.00hr@8hrs@34 days $18,496.00
Weekend and After Hours Labor -47 days @ 8hrs @ $11.42 hr $4,292.92
Total amount of additional monies from 34 days of Delays $28,933.40
If you have any questions at all, please do not hesitate to contact our office at your
convenience. Again please review the documentation and consider additional
compensation.
On September 17, 2012, Shaulis sent Denco’s final $32,848.44 invoice to Bradley with the
notation, “Per our earlier email. Here is the Final amount due, to Denco for the Body Bar, Plano,
TX. This will be [the] billing for remaining balance of all [Proposed Change Orders (PCO)] as
well as all new PCO’s as sent on Friday 9-14.” Later that day, Shaulis clarified, “The final
invoice did not include the delay claim amount of $28[,]933.40 that was also sent over late last
week. I[’]m hoping this amount is being considered.”
8
On October 3, 2012, Shaulis e-mailed Bradley to inquire about the “payment status of
[Denco’s] Final Billing and Status of any monies to be paid on [its] Delay Claim.” Bradley
responded, “The check is going out today for final billing.” On that date, Body Bar paid the final
invoice—including additional sums for PCO’s—in full. In total, Body Bar paid Denco
$140,630.85—$16,789.04 more than the amount included in the contract estimate.
Denco accepted and applied Body Bar’s final payment and produced documentation
showing that the account had a zero balance. On October 8, 2012, Shaulis thanked Bradley for
payment of the final invoice, but wrote, “We would like to inquire with respect, on our Delay
Claim that was sent on September 13, 2012. Our office worked diligently in order to keep the
project moving forward in spite of all the delays that were presented. Has any consideration of
additional funding been given?” On October 17, 2012, Smith again asked Bradley about the
delay cost and pleaded, “The cost of said delays was substantial in fact at this point our cost
exceeds the job income due to the delays out of our control. We are always thankful to be a part
of any Team but believe we deserve some help with these cost[s].” On November 5, 2012,
Smith pleaded with Body Bar’s majority shareholder, again reminding that the delays were the
result of “incomplete designs or designs that do not meet city requirement[s]” and suggesting, “I
say we pursue the claim and perhaps you will get paid with the Design Team errors and omission
insurance.”
On December 7, 2012, Smith executed a lien affidavit in which he swore that Denco had
furnished labor and materials for improvement to real property under an agreement with Body
Bar and that “$28,933.40 . . . remain[ed] unpaid and is due and owing to Claimant under its
9
agreement with Body Bar.” The lien affidavit and claim purporting to encumber the rental space
with a lien was filed with the Clerk of Collin County, Texas, on December 13, 2012, in order to
obtain both statutory and constitutional liens. Denco sent both Bre Thorne and Body Bar notice
of the filing of the lien affidavit on December 26, 2012. On January 16, 2013, Body Bar’s
counsel responded to Denco’s notice by arguing that the alleged liens were invalid because
(1) they were based, in part, on work performed in June 2012 and the statutory deadline for filing
liens expired in November 2012, 6 (2) Denco failed to provide Body Bar with notice of the lien as
required by the Texas Property Code, (3) the contract did not provide for delay damages, and
(4) Body Bar paid Denco in full for all invoices under the contract and all approved PCOs. 7
Denco did not take action to relieve the property of the cloud on the title cast by the lien
affidavits.
Body Bar sued Denco and, after adequate time for discovery, moved for summary
judgment. In addition to documents demonstrating the facts recited above, Body Bar submitted
Bradley’s affidavit as summary judgment evidence. Bradley’s affidavit swore (1) that Denco
never requested additional compensation for the delays until after the project was completed, 8
(2) that “Denco further told [me] that the amount Denco sought in payment application number
6
“[T]he person claiming the lien must file an affidavit with the county clerk of the county in which the property is
located . . . not later than the 15th day of the fourth calendar month after the day on which the indebtedness
accrues.” TEX. PROP. CODE ANN. § 53.052(a) (West 2007).
7
The letter also warned, “Further, if DENCO’s actions in filing these fraudulent liens have in any way damaged
Body Bar’s relationship with Premises owner Bre Thorne, Body Bar will seek full restitution of these damages from
DENCO.”
8
Bradley’s affidavit contains a minor discrepancy because it states both that “Denco completed work on the Project
on or about the 18th day of September 2012” and that “[o]n September 13, 2012, after completion of the Project,
Denco requested Body Bar to consider additional compensation.” However, e-mails from Shaulis establish that the
project was completed prior to submission of the final invoice.
10
four is the final amount Body Bar owed to Denco for the Project,” (3) that Body Bar never
agreed to pay the delay charges in writing or otherwise, (4) that Denco merely requested
payment of the delay claim and did not demand payment before filing the lien affidavits, (5) that
Denco never provided documentation demonstrating that Body Bar was obligated to pay the
delay claim, (6) that Body Bar paid all of Denco’s invoices and PCOs, and (7) that, as a result of
the liens, Bre Thorne informed Body Bar that it was withholding the $25,000.00 tenant
improvement allowance (reimbursement). Body Bar also submitted an attorney fees affidavit
that detailed its attorneys’ hourly rates and work completed, attached counsels’ billing records,
and concluded, “Body Bar has incurred a total of $16,451.00 in reasonable and necessary
attorneys’ fees in this matter, and $491.10 in costs.”
In response to Body Bar’s combination traditional and no-evidence summary judgment
motion, Denco attached Shaulis’ affidavit, which stated,
Additional work for this project was necessary due to multiple delays caused by
Body Bar, LLC and its representatives, resulting in additional work beyond the
scope of the original agreement to be completed by Denco, notice of these delays
and additional expenses were timely documented by Denco and communicated to
Body Bar, LLC both during the completion of this construction project and upon
completion of the project.[9]
Denco relied on the language in the contract stating, “Request for work in addition to the
Proposal may be completed, and, even without a signed Change Order, will result at an
additional cost to the Owner. It shall be the Owner’s responsibility to secure a written proposed
Change Order before requesting additional work.”
9
At the summary judgment hearing, Denco’s counsel stated that the delay claim was for “additional work hours that
were required to complete the project as per the contract.”
11
Based on this evidence, the trial court granted Body Bar’s traditional and no-evidence
motion for summary judgment.
III. Analysis of the Trial Court’s Entry of Summary Judgment
A. Denco’s Affidavits Were Not Effective to Create a Valid Mechanic’s Lien
Denco argues that Body Bar was not entitled to a declaratory judgment that the alleged
liens were invalid. In its motion for summary judgment, Body Bar argued that “Denco had no
legal right to place a lien on the fee interest of the landlord’s property” due to lack of privity of
contract with Bre Thorne. We agree.
Denco’s lien encumbered the following property: “PRESTON PARK VILLAGE, BLK
A, LOT 1R, 26305 ACRES, CITY OF PLANO . . . (1900 PRESTON RD., SUITE 269).” 10 At
the time that the liens were filed, the property was owned in fee by Bre Thorne. Texas law
recognizes two possible types of mechanic’s liens: (1) a constitutional lien and (2) a statutory
lien. TEX. CONST. art. XVI, § 37; TEX. PROP. CODE ANN. 53.001 (West 2007). “[A]
constitutional lien requires a person to be in privity of contract with the property owner.” 11
Trinity Drywall Sys., LLC v. Toka Gen. Contrs., Ltd., 416 S.W.3d 201, 209 (Tex. App.—El Paso
2013, pet. filed); see Gibson v. Bostick Roofing & Sheet Metal Co., 148 S.W.3d 482, 493 (Tex.
10
We assume that the lien encumbered only 1900 Preston Road, Suite 269, and not the entire acreage set forth in the
lien affidavit.
11
Article XVI, Section 37 of the Texas Constitution provides,
Mechanics, artisans and material men, of every class, shall have a lien upon the buildings and
articles made or repaired by them for the value of their labor done thereon, or material furnished
therefor; and the Legislature shall provide by law for the speedy and efficient enforcement of said
liens.
TEX. CONST. art. XVI, § 37.
12
App.—El Paso 2004, no pet.). The same privity of contract with the property owner is required
to establish a statutory lien that encumbers the owner’s property. See TEX. PROP. CODE ANN.
§ 53.021(a)(2) (West Supp. 2013) (A person has a statutory lien if “the person labors . . . or
furnishes the labor or materials under or by virtue of a contract with the owner or the owner’s
agent . . . .”); TEX. PROP. CODE ANN. § 53.001(7) (defining “Original Contractor” as “a person
contracting with an owner either directly or through the owner’s agent”).
Smith’s lien affidavit listed Bre Thorne as the owner of the property sought to be
encumbered. Yet, there is no evidence in the record establishing that either Regency (who was
the owner of the premises at the time the contract for improvements was entered) or Bre Thorne
(the subsequent owner) contracted with Denco or that Body Bar was the agent of either at the
time it entered into the contract for improvements or when Denco’s additional charges
supposedly accrued. “[W]here the contract for labor, materials or construction is not made with
the owner or his duly-authorized agent, a lien may not be fixed on his property.” Gibson, 148
S.W.3d at 494; see 2811 Assocs., Ltd. v. Metroplex Lighting & Elec., 765 S.W.2d 851, 853 (Tex.
App.—Dallas 1989, writ denied). The mechanic’s lien affidavit was not filed until after Regency
had sold to Bre Thorne.
Because there was no evidence that Denco was in privity of contract with the owner of
the premises, it was not entitled to a constitutional lien against Bre Thorne’s fee interest in the
property. “[I]f a lessee contracts for construction, the mechanic’s lien attaches only to the
leasehold interest, not to the fee interest of the lessor.” Diversified Mortg. Investor v. Lloyd D.
Blaylock Gen. Contractor, Inc., 576 S.W.2d 794, 805 (Tex. 1978); see Bannum, Inc. v. Mees,
13
No. 07-12-00458-CV, 2014 WL 2918436, at **3–4 (Tex. App.—Amarillo Jun. 24, 2014, no pet.
h.) (mem. op.); Terraces at Cedar Hill, L.L.C. v. Gartex Masonry & Supply, Inc., No. 05-10-
00226-CV, 2011 WL 1050852, at *2 (Tex. App.—Dallas Mar. 24, 2011, pet. denied) (mem. op.).
Thus, the affidavit laying claim to statutory and constitutional mechanic’s liens—which were not
limited to Body Bar’s leasehold interest—did not validly encumber the property. 12 Because the
liens were not perfected, Denco was not entitled to foreclosure.
B. Summary Judgment on Denco’s Breach of Contract Claims Was Proper
“The elements of a breach of contract claim are (1) the existence of a valid contract,
(2) the plaintiff’s performance or tendered performance, (3) the defendant’s breach of the
contract, and (4) damages as a result of the breach.” Jespersen v. Sweetwater Ranch Apartments,
390 S.W.3d 644, 658 (Tex. App.—Dallas 2012, no pet.). Body Bar argues that it conclusively
established compliance with its obligations under the contract and that Denco breached the
contract by attempting to charge more than the contractual amount.
12
Body Bar argues that Denco failed to meet statutory requirements to perfect the lien. “A person who files an
affidavit must send a copy of the affidavit by registered or certified mail to the owner or reputed owner . . . not later
than the fifth day after the date the affidavit is filed with the county clerk.” TEX. PROP. CODE ANN. § 53.055(a)
(West 2007). “A party must comply with chapter 53 to perfect a lien under the statute.” Addison Urban Dev.
Partners, LLC v. Alan Ritchey Materials Co., LC, No. 05-13-00122-CV, 2014 WL 2946019, at *4 (Tex. App.—
Dallas July 1, 2014, no pet. h.) (citing Morrell Masonry Supply, Inc. v. Lupe’s Shenandoah Reserve, LLC, 363
S.W.3d 901 (Tex. App.—Beaumont 2012, no pet.); TEX. PROP. CODE ANN. § 53.051). Here, Denco admitted that it
failed to comply with Section 53.055(a). However, substantial compliance with Chapter 53 is sufficient, and
“[c]ases interpreting the mechanic’s and materialman’s lien statutes counsel against invalidating a lien on a purely
technical basis.” Id. (citing Ready Cable, Inc. v. RJP S. Comfort Homes, Inc., 295 S.W.3d 763, 765 (Tex. App.—
Austin 2009, no pet.)).
14
The question of whether Body Bar tendered full performance under the contract requires
contract interpretation. In this case, neither party argues that the contract is ambiguous. 13 The
bid proposal included the following work: demolition, foundations/slabs/piers, masonry/brick–
ledger stone veneer, structural steel, finish carpentry/millwork/trim carpentry, doors/frames,
finish hardware, glazing/storefront, drywall/framing, ceilings, flooring, tape/bed/paint, fire
extinguishers, HVAC/controls, plumbing, electrical, furnishings (installation only), granite tops,
custom ceiling over bar, restroom makeover, replace restroom sink, temporary protection, small
tools and miscellaneous expense, dumpster fees, final clean and make ready, and insurance. 14
Denco’s contract with Body Bar incorporated its $123,841.81 bid, specifically including all work
required to complete the proposal, and the only provision it made for per-diem damages for
delays was a fee that Denco would be assessed if it did not complete the project within a
specified time. 15 The proposal’s General Conditions section specifically set forth a lump sum
cost for the total labor burden, and a cost for ten additional hours of miscellaneous labor. By its
plain terms, the contract included all of the labor required to complete the proposal.
The delay logs demonstrate that the overtime labor was expended on completing work
included in the proposal. As an example, the table below lists the reason for the delay included
in the delay log, along with the work to be completed by Denco under the terms of the proposal:
13
“If a contract is worded such that it can be given a certain or definite legal meaning, we construe the contract as a
matter of law.” Am. Bd. of Obstetrics & Gynecology, Inc. v. Yoonessi, 286 S.W.3d 624, 628 (Tex. App.—Dallas
2009, pet. denied).
14
The proposal also incorporated the cost of the following items for five weeks: truck and gas allowance, temporary
phone, temporary data, project manager, project administrator, project superintendent.
15
The contract provided for per-diem liquidated damages in case Denco failed to complete the project on time.
Perhaps Denco chose to hire overtime workers to complete the project to avoid assessment of a substantial amount
of liquidated damages.
15
Reason for Delay Provided in Delay Log Proposal Work Item Impacted
Permit Delay All
Custom Glass Doors Delay Doors/Frames
AC Unit Delay HVAC/Controls
Juice Bar Ceiling, Not per City Code Finish Carpentry/Millwork/Trim
Carpentry
Interior Dimensions Drywall/Framing; Finish Carpentry/
Millwork/Trim Carpentry
Quarry Tile Discontinued Flooring
Granite Cambria Torquay is Millwork
Backordered
Candle Niche, Trim Out and Placement Millwork
Air Conditioning into Reception Area HVAC/Controls
Receipt of New Stone for Walls Flooring, Painting
Finish Hardware for Custom Glass Finish Hardware
Door
Receipt of New Stone for Walls Flooring, Painting
Denco’s response relies on a contract clause which states, “Request for work in addition
to the Proposal may be completed, and, even without a signed Change Order, will result at an
additional cost to [Body Bar]. It shall be [Body Bar’s]’s responsibility to secure a written
proposed Charge Order before requesting additional work.” Denco argues that this clause
applies because Shaulis’ affidavit “provide[s] evidence that there was additional work required to
be completed by [Denco] outside of the scope of the contract.” 16 Shaulis’ affidavit stated,
Additional work for this project was necessary due to multiple delays caused by
Body Bar, LLC and its representatives, resulting in additional work beyond the
scope of the original agreement to be completed by Denco, notice of these delays
and additional expenses were timely documented by Denco and communicated to
Body Bar, LLC both during the completion of this construction project and upon
completion of the project.
16
We do not believe Denco is truly arguing that the work completed by its laborers was outside the scope of the
contract. If that was so, Denco’s evidence was insufficient to raise a genuine issue of material fact on its claim for
breach of contract. Rather, we believe Denco argues that additional work required was outside the scope of the bid
proposal incorporated into the contract and that the contract provided a procedure by which Body Bar could be
charged for additional work.
16
First, Shaulis’ statement that the work completed by the laborers constituted “additional
work beyond the scope of the original agreement” is unfounded and incorrect. Body Bar
objected to Shaulis’ affidavit at trial, claiming it is conclusory, and Body Bar reasserts that
complaint on appeal. 17 “Conclusory statements in affidavits are not proper summary judgment
evidence if there are no facts to support the conclusions.” James L. Gang & Assocs., Inc. v.
Abbott Labs., Inc., 198 S.W.3d 434, 439 (Tex. App.—Dallas 2006, no pet.); see E.I. Du Pont
De Nemours & Co. v. Shell Oil Co., 259 S.W.3d 800, 809 (Tex. App.—Houston [1st Dist.] 2007,
pet. denied) (affidavit is conclusory when it expresses inference without stating underlying facts
supporting inference). Because it does not raise fact issues, a conclusory affidavit is incompetent
evidence that, as a matter of law, does not support a summary judgment. Ryland Grp., Inc. v.
Hood, 924 S.W.2d 120, 122 (Tex. 1996) (per curiam) (conclusory affidavits “are not credible,
nor susceptible to being readily controverted”); see Anderson v. Snider, 808 S.W.2d 54, 55 (Tex.
1991) (per curiam) (op. on reh’g). Without referencing the type of work completed during the
overtime labor, Shaulis classified the work as “additional work” that was not contemplated by
the bid proposal. Shaulis made this statement even though (1) the delay logs establish that the
delay only impacted Denco’s ability to proceed with labor on items included in the proposal, and
(2) the record is devoid of evidence showing that the laborers who worked overtime completed
17
Body Bar did not secure a ruling on this objection. However, “conclusory statements in affidavits are errors of
substance and not form, and such defect is not waived on appeal by failure to object in the trial court, or as in this
case, to obtain a ruling on the objection.” Clarendon Nat’l Ins. Co. v. Thompson, 199 S.W.3d 482, 490 n.7 (Tex.
App.—Houston [1st Dist.] 2006, no pet.) (citing Ramirez v. Transcon. Ins. Co., 881 S.W.2d 818, 829 (Tex. App.—
Houston [14th Dist.] 1994, writ denied)); see Strother v. City of Rockwall, 358 S.W.3d 462, 469 (Tex. App.—Dallas
2012, no pet.) (citing Thompson v. Curtis, 127 S.W.3d 446, 450 (Tex. App.—Dallas 2004, no pet.).
17
work that was not contemplated by the bid proposal. Because Shaulis’ conclusion was not
supported by fact, we find this portion of Shaulis’ affidavit conclusory.
Second, the contract clause upon which Denco relies only allowed Denco to charge an
additional cost for “work in addition to the [p]roposal” that had been requested by Body Bar.
Shaulis’ affidavit stated only that additional work was necessary, not that additional work was
requested by Body Bar. Further, there is no other evidence that Body Bar requested additional
work outside of the scope of the bid proposal. Thus, the clause upon which Denco relies to
support its interpretation of the contract is inapplicable.
Here, the summary judgment evidence conclusively established that all of the delay labor
cost was included in the contract price. The evidence established that (1) while Body Bar was
consistently informed about the project delays and reasons for the delay, Denco did not notify
Body Bar that it was paying laborers overtime to speed up the project and did not seek payment
for work completed by the laborers until after the project was completed; (2) Denco merely
asked Body Bar to consider the damage claim and did not represent that Body Bar was required
to pay the claim under the contract until after the lien affidavit was filed; (3) Denco excluded the
delay claim from the last invoice; (4) Shaulis affirmed that the bid included all labor, and
revealed that Denco underestimated the labor cost when she wrote, “In cost for General
Conditions we have calculated for the 34 days past the August 4, Opening Date;” (5) Denco
described its last invoice to Body Bar as the final invoice containing the “Final amount due, to
Denco for the Body Bar” project; (6) Shaulis e-mailed Bradley and expressed her “hope” that the
18
delay amount was being considered; (7) Denco applied the final payment and produced
documentation demonstrating that the Body Bar account had a zero balance.
The summary judgment evidence further established that Body Bar fully paid all of the
invoices submitted by Denco in accord with the contract. Because we have determined (1) that
the cost for overtime labor was included in the contract price, (2) that the contract price was paid
in full, and (3) that no evidence shows that Body Bar otherwise agreed to pay additional sums for
the overtime labor, we find that Body Bar established its full performance under the contract as a
matter of law and that Denco failed to raise a genuine issue of material fact that Body Bar
breached the contract.
Because Denco failed to raise a genuine issue of material fact on its breach of contract
claim, the trial court’s ruling on the no-evidence motion for summary judgment was also proper.
C. Body Bar Did Not Establish Damages Resulting from Denco’s Breach
The summary judgment movant has the burden of establishing its right to summary
judgment by conclusively proving all elements of its cause of action as a matter of law. Rhone-
Poulenc, Inc. v. Steel, 997 S.W.3d 217, 223 (Tex. 1999). As our discussion in the previous
section shows, Body Bar established as a matter of law the existence of a valid contract, Body
Bar’s performance of the contract, and Denco’s breach of the contract by seeking to charge
additional amounts to which it was not entitled. However, although Body Bar established that
Denco breached its contract, it has not shown that it was damaged by that breach, an essential
element of its cause of action.
19
First, it is undisputed that Body Bar never paid Denco the additional amounts it sought.
Therefore, even though Denco may have technically breached the contract by seeking amounts to
which it was not entitled, Body Bar did not suffer damages as a result of this breach. See
Pegasus Energy Grp., Inc. v. Cheyenne Petroleum Co., 3 S.W.3d 112, 127 (Tex. App.—Corpus
Christi 1999, pet. denied).
Body Bar also alleged that it was damaged as a result of Denco’s filing of the lien
affidavits. As we have seen, the filing of the lien affidavits was wrongful and placed a cloud on
the title of the owner of the real estate. However, this did not directly injure Body Bar. Body
Bar relied on Bradley’s affidavit to establish that Body Bar incurred damages as a result of
Denco’s breach in the form of Bre Thorne’s withholding of the tenant improvement allowance or
reimbursement. The affidavit stated,
The landlord for the Premises previously notified Body Bar that it was
withholding the tenant improvement allowance due and owing to Body Bar
pursuant to the lease for the Premises due to the lien on the Premises filed by
Denco. The amount of the tenant improvement allowance that the landlord
refused to pay Body [B]ar is $25,000.00.
So, Body Bar is claiming damages related to its landlord’s withholding payment under an
unrelated contract. Clearly, these damages, if any, are only indirectly related to the wrongful
filing of the lien affidavit, but not to Denco’s breach of contract. It was only after Body Bar’s
landlord, the owner of the real estate, withheld payment because of the lien that Body Bar
suffered any damage. This damage, however, was only indirectly the result of Denco’s actions.
Further, Body Bar has not pointed to any provision in the contract that this filing
allegedly breached. Since Body Bar has not shown that Denco’s filing of the lien affidavits was
20
a breach of its contract, it cannot rely on this action to support any breach of contract damages.
Therefore, since Body Bar has not established as a matter of law that Denco’s breach caused it
any damages, it was not entitled to summary judgment on its breach of contract claims.
D. Body Bar Was Not Entitled to an Award of Damages
At the summary judgment hearing, Denco argued that because Body Bar’s pleadings
indicated that Bre Thorne would pay the reimbursement in the event that the liens were removed,
an order requiring Denco to pay the $25,000.00 “would result in a double . . . resolution or a
windfall.” In response, Body Bar admitted,
Your Honor, real briefly regarding the $25,000 claim, that’s not anywhere.
There’s no evidence of that fact. There’s no personal knowledge of that fact.
The landlord has told us we’re not going to get the [$]25,000, and at this
point, a year later, we do not know whether they’re going to give it to us or not.
Certainly, we do not want a double recovery.
Because (1) Bradley’s affidavit stated that Bre Thorne was withholding the
reimbursement due to the liens, (2) the liens were properly declared invalid, and (3) the summary
judgment evidence fails to establish whether Bre Thorne will continue to refuse to pay
reimbursement once the liens are lifted, we find that Body Bar did not show entitlement to the
$25,000.00 awarded to it in the trial court’s summary judgment as a matter of law. Accordingly,
we reverse the trial court’s award of $25,000.00 to Body Bar and remand the issue of damages to
the trial court for further proceedings.
E. Tortious Interference Was Not Conclusively Established
The elements of tortious interference with contractual relations are “(1) the existence of a
contract subject to interference, (2) the act of interference was willful and intentional, (3) such
21
intentional act was a proximate cause of plaintiff's damage and (4) actual damage or loss
occurred.” Victoria Bank & Trust Co. v. Brady, 811 S.W.2d 931, 939 (Tex. 1991); see
Browning-Ferris, Inc. v. Reyna, 865 S.W.2d 925, 926 (Tex. 1993).
Denco argues that Body Bar failed to introduce any evidence demonstrating that Denco
knew of relevant lease terms or that Denco willfully and intentionally interfered with the lease
agreement. We agree. See Sw. Bell Tel. Co. v. John Carlo Tex., Inc., 843 S.W.2d 470, 472 (Tex.
1992) (question is whether defendant desired to interfere with contract or believed interference
was substantially certain to result from actions). Body Bar’s lease agreement with Bre Thorne is
not included in the summary judgment record. Rather, the relevant terms of the lease are set
forth in Bradley’s affidavit, but Bradley makes no mention of whether these lease terms were
communicated to Denco. Thus, nothing in the record established willful and intentional
interference with the lease agreement. Accordingly, the trial court’s summary judgment on this
ground was improper and is reversed.
F. Denco Was Not Entitled to Equitable Relief
As a threshold issue, Denco argues that the trial court erred in resolving its claim for
quantum meruit because Body Bar’s motion for summary judgment failed to address the claim.
Under the heading “Quantum Meruit/Unjust Enrichment,” Denco pled,
Defendant provided materials and labor for the construction project the subject of
this suit. Plaintiff received a benefit, in the form of the labor and materials
provided by defendant, which improved the structures and increased the value of
this property. To date defendant has not received full payment for the labor and
materials provided on this project. Plaintiff received a benefit from defendant’s
labor and materials and it is unjust for them to retain this benefit without
providing just compensation to Defendant for their labor and materials provided.
22
Defendant is entitled to restitution for the value of the benefit Plaintiff received
through Defendant’s labor and materials provided for this project.[18]
A party may recover under the unjust enrichment theory when one person has obtained a
benefit from another by fraud, duress, or the taking of an undue advantage. Heldenfels Bros.,
Inc. v. City of Corpus Christi, 832 S.W.2d 39, 41 (Tex. 1992). Denco’s pleading does not allege,
and Body Bar argued that there was no evidence demonstrating, that Body Bar benefited by
fraud, duress, or the taking of unfair advantage. Body Bar’s initial summary judgment motion,
however, did not specifically mention quantum meruit—“an equitable theory of recovery . . .
based on an implied agreement to pay for benefits received.” Id. (citing Vortt Exploration Co. v.
Chevron U.S.A., Inc., 787 S.W.2d 942, 944 (Tex. 1990)). 19 It appears that despite its third
counter-claim heading, Denco’s petition only asserted quantum meruit, whereas Body Bar’s
initial no evidence motion addressed only unjust enrichment. However, Body Bar filed a sur-
reply prior to the summary judgment hearing arguing that Denco’s “quantum meruit claims
fail[ed]” as a matter of law.
In any event, aside from certain exceptions not relevant here, a plaintiff who seeks to
recover the reasonable value of services rendered or materials supplied will be permitted to
recover in quantum meruit or unjust enrichment only when there is no express contract covering
those services or materials. Fortune Prod. Co. v. Conoco, Inc., 52 S.W.3d 671, 683–84 (Tex.
18
The trial court granted Body Bar’s no-evidence motion on “Denco’s [claim] for quantum meruit/unjust
enrichment.”
19
“To recover under the doctrine of quantum meruit, a plaintiff must establish that: 1) valuable services and/or
materials were furnished, 2) to the party sought to be charged, 3) which were accepted by the party sought to be
charged, and 4) under such circumstances as reasonably notified the recipient that the plaintiff, in performing,
expected to be paid by the recipient.” Heldenfels Bros., 832 S.W.2d at 41 (citing Vortt Exploration, 832 S.W.2d at
944).
23
2000); Truly v. Austin, 744 S.W.2d 934, 936 (Tex. 1988) (citing Black Lake Pipeline v. Union
Construction Co., 538 S.W.2d 80, 86 (Tex. 1976), overruled on other grounds by Sterner v.
Marathon Oil Co., 767 S.W.2d 686 (Tex.1989); Woodard v. Sw. States, Inc., 384 S.W.2d 674,
675 (Tex. 1964)). “That is because parties should be bound by their express agreements. When
a valid agreement already addresses the matter, recovery under an equitable theory is generally
inconsistent with the express agreement.” Fortune Prod., 52 S.W.3d at 684. Thus, as is the case
here, “when a party claims that it is owed more than the payments called for under a contract,
there can be no recovery for unjust enrichment [or quantum meruit] ‘“if the same subject is
covered by [the] express contract.”’” Id. (quoting TransAm. Natural Gas Corp. v. Finkelstein,
933 S.W.2d 591, 600 (Tex. App.—San Antonio 1996, writ denied) (quoting Lone Star Steel Co.
v. Scott, 759 S.W.2d 144, 154 (Tex. App.—Texarkana 1988, writ denied))).
Because we determined that Body Bar’s contract with Denco included all sums for labor
required to complete the proposal and that the overtime workers labored on items expressly
included in the proposal, we find that Denco’s equitable claims were barred as a matter of law.
Thus, the trial court’s entry of a ruling on the no-evidence summary judgment on Denco’s quasi-
contractual claims was proper.
IV. Conclusion
We affirm the trial court’s summary judgment (1) granting Body Bar’s declaratory
judgment claim and (2) disposing of all of Denco’s claims. We reverse the portion of the trial
court’s summary judgment (1) finding that Body Bar established tortious interference as a matter
of law, (2) granting Body Bar’s breach of contract claim, and (3) awarding $25,000.00 to Body
24
Bar and remand these matters to the trial court for further proceedings consistent with this
opinion.
Bailey C. Moseley
Justice
Date Submitted: August 22, 2014
Date Decided: September 26, 2014
25
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U NITED S TATES N AVY –M ARINE C ORPS
C OURT OF C RIMINAL A PPEALS
_________________________
No. 201800015
_________________________
UNITED STATES OF AMERICA
Appellee
v.
RANDALL D. SHOOK
Gas Turbine System Technician (Mechanical) Second Class (E-5),
U.S. Navy
Appellant
_________________________
Appeal from the United States Navy -Marine Corps Trial Judiciary
Military Judge: Commander Aaron C. Rugh, JAGC, USN.
Convening Authority: Commanding Officer, USS Russell (DDG 59).
For Appellant: Lieutenant Jacqueline M. Leonard, JAGC, USN.
For Appellee: Brian K. Keller, Esq.
_________________________
Decided 29 May 2018
_________________________
Before M ARKS , J ONES , and E LLINGTON , Appellate Military Judges
_________________________
After careful consideration of the record, submitted without assignment of
error, we affirm the findings and sentence as approved by the convening
authority. Art. 66(c), Uniform Code of Military Justice, 10 U.S.C. § 866(c).
For the Court
R.H. TROIDL
Clerk of Court
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Court of Appeals
of the State of Georgia
ATLANTA, January 31, 2017
The Court of Appeals hereby passes the following order
A17D0238. AMGUARD INSURANCE v. MATTHEW KERKELA.
Upon consideration of the Application for Discretionary Appeal, it is ordered that it be
hereby GRANTED. The Appellant may file a Notice of Appeal within 10 days of the date of
this order. The Clerk of Superior Court is directed to include a copy of this order in the record
transmitted to the Court of Appeals.
LC NUMBERS:
2016CV2527
Court of Appeals of the State of Georgia
Clerk's Office, Atlanta, January 31, 2017.
I certify that the above is a true extract from the minutes
of the Court of Appeals of Georgia.
Witness my signature and the seal of said court hereto
affixed the day and year last above written.
, Clerk.
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 99-7549
JIMMY G. BLAKELY,
Plaintiff - Appellant,
versus
COUNTY OF GREENVILLE; GREENVILLE COUNTY DETEN-
TION CENTER; GERALD SEALS; JIM DORRIETY,
Defendants - Appellees.
Appeal from the United States District Court for the District of
South Carolina, at Rock Hill. Margaret B. Seymour, District Judge.
(CA-98-2468-0-24)
Submitted: February 24, 2000 Decided: March 3, 2000
Before MOTZ and KING, Circuit Judges, and BUTZNER, Senior Circuit
Judge.
Affirmed by unpublished per curiam opinion.
Jimmy G. Blakely, Appellant Pro Se. Russell W. Harter, Jr.,
CHAPMAN, HARTER & GROVES, P.A., Greenville, South Carolina, for
Appellees.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
PER CURIAM:
Jimmy G. Blakely appeals the district court’s order denying
relief on his 42 U.S.C.A. § 1983 (West Supp. 1999) complaint. We
have reviewed the record and the district court’s opinion accepting
the magistrate judge’s recommendation and find no reversible error.
Accordingly, we affirm on the reasoning of the district court. See
Blakely v. County of Greenville, No. CA-98-2468-0-24 (D.S.C. Oct.
29, 1999). We dispense with oral argument because the facts and
legal contentions are adequately presented in the materials before
the court and argument would not aid the decisional process.
AFFIRMED
2
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54 F.3d 767
In re Jathor Eliaeh Easley, III, a/k/a, d/b/a Jay'sPhotography; Jathor Eliaeh Easley, IIIv.Superior Court of New Jersey, Middlesex County Probation Dept.
NO. 94-5782
United States Court of Appeals,Third Circuit.
Apr 19, 1995
Appeal From: D.N.J., No. 94-cv-03363,
Brown, J.
1
AFFIRMED.
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741 F.2d 1380
*U.S.v.Bernard
83-4741
United States Court of Appeals,Fifth Circuit.
8/24/84
1
W.D.La.
AFFIRMED
2
---------------
* Fed.R.App.P. 34(a); 5th Cir.R. 34.2.
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 16-1598
DR. NANETTE LIEGEOIS,
Plaintiff - Appellant,
v.
JOHNS HOPKINS MEDICINE; BOARD OF TRUSTEES OF JOHNS HOPKINS
MEDICINE; JOHNS HOPKINS UNIVERSITY; BOARD OF TRUSTEES JOHN
HOPKINS UNIVERSITY; JOHNS HOPKINS HOSPITAL; CHARLES
CUMMINGS; DR. SEWON KANG; DR. EDWARD MILLER; DR. WILLIAM
NELSON; DR. RICHARD GROSSI; DR. JANICE CLEMENTS; DR. MANISHA
PATEL; JOHNS HOPKINS SCHOOL OF MEDICINE; BOARD OF TRUSTEES
OF JOHNS HOPKINS SCHOOL OF MEDICINE; JOHNS HOPKINS HOSPITAL
AND HEALTH SYSTEM; BOARD OF TRUSTEES OF JOHNS HOPKINS
HOSPITAL AND HEALTH SYSTEM; SUBSIDIARIES AND AFFILIATES OF
JOHNS HOPKINS SCHOOL OF MEDICINE; SUBSIDIARIES AND
AFFILIATES OF JOHNS HOPKINS HOSPITAL AND HEALTH SYSTEM;
SUBSIDIARIES AND AFFILIATES OF JOHNS HOPKINS UNIVERSITY,
Defendants - Appellees.
Appeal from the United States District Court for the District of Maryland, at Baltimore.
J. Frederick Motz, Senior District Judge. (1:15-cv-02919-JFM)
Submitted: March 31, 2017 Decided: July 6, 2017
Before GREGORY, Chief Judge, and KING and WYNN, Circuit Judges.
Affirmed by unpublished per curiam opinion.
David A. Branch, LAW OFFICE OF DAVID A. BRANCH & ASSOCIATES, PLLC,
Washington, D.C., for Appellant. Darrell R. VanDeusen, Alexander P. Berg,
KOLLMAN & SAUCIER, P.A., Timonium, Maryland, for Appellees.
Unpublished opinions are not binding precedent in this circuit.
2
PER CURIAM:
Dr. Nanette Liegeois filed a complaint against Johns Hopkins Medicine, its
affiliates, and several individuals alleging employment discrimination in violation of 42
U.S.C. § 1981 (2012), Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C.
§§ 2000e to 2000e-17 (2012) (Title VII), and the Americans with Disabilities Act, 42
U.S.C. §§ 12101-12213 (2012) (ADA). The district court granted Defendants’ motion to
dismiss the complaint finding that all claims arising before October 9, 2015, * that she
may have had were barred by the release, and that the vast majority of Liegeois’ claims
were also time-barred. The court further dismissed her § 1981 retaliation claims as either
barred by the release or because Liegeois failed to allege sufficient temporal proximity to
state a viable claim of retaliation.
We review de novo the grant of a motion to dismiss under Fed. R. Civ. P.
12(b)(6). See Coleman v. Md. Ct. of App., 626 F.3d 187, 190 (4th Cir. 2010). When
ruling on such a motion, “a judge must accept as true all of the factual allegations
contained in the complaint.” Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per curiam). A
complaint “need only give the defendant fair notice of what the claim is and the grounds
upon which it rests.” Id. at 93 (alteration and internal quotation marks omitted).
We have thoroughly reviewed the parties’ briefs, the district court’s order and
judgment, and the materials submitted in the joint appendix and find no reversible error.
* Although the district court’s order barred Liegeois’ claims arising before
“October 9, 2015,” this was clearly a clerical error, as the district court expressly
referenced the date Liegeois signed her release, October 9, 2009, as the relevant date.
3
Accordingly, we affirm for the reasons stated by the district court. Liegeois v. Johns
Hopkins Med., No. 1:15-cv-02919-JFM (D. Md. Apr. 21, 2016). 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.
AFFIRMED
4
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United States Court of Appeals
For the Eighth Circuit
___________________________
No. 14-3405
___________________________
Lion Oil Company
lllllllllllllllllllllPetitioner
v.
Environmental Protection Agency
lllllllllllllllllllllRespondent
____________
Petition for Review of an Order of the
Environmental Protection Agency
____________
Submitted: June 11, 2015
Filed: July 8, 2015
____________
Before GRUENDER, BEAM, and BENTON, Circuit Judges.
____________
BENTON, Circuit Judge.
Lion Oil Company petitioned the Environmental Protection Agency for an
exemption from the Renewable Fuel Standard program for 2013. EPA denied the
petition. Lion Oil appeals. Having jurisdiction under 42 U.S.C. § 7607(b)(1), this
court affirms.
I.
The RFS program sets annual renewable-fuel targets for refineries. See 42
U.S.C. § 7545(o). Refineries must blend their share of renewable fuel or buy credits
from those who exceed blending requirements. Congress exempted “small”
refineries—75,000 barrels of crude oil or less per day—from RFS obligations until
2011. §§ 7545(o)(1)(K), 7545(o)(9)(A)(i). The exemption can be extended. The
Department of the Energy “shall conduct for [EPA] a study to determine whether
compliance with [RFS requirements] would impose a disproportionate economic
hardship on small refineries.” § 7545(o)(9)(A)(ii)(I). If DOE determines a small
refinery “would be subject to a disproportionate economic hardship if required to
comply,” EPA “shall extend the exemption . . . for a period of not less than 2
additional years.” § 7545(o)(9)(A)(ii)(II). Also, “A small refinery may at any time
petition [EPA] for an extension of the exemption . . . for the reason of
disproportionate economic hardship.” § 7545(o)(9)(B)(i). When evaluating such
petitions, EPA, “in consultation with the Secretary of Energy, shall consider the
findings of [DOE’s] study . . . and other economic factors.” § 7545(o)(9)(B)(ii).
DOE completed its study in 2011. It concluded, “Disproportionate economic
hardship must encompass two broad components: a high cost of compliance relative
to the industry average, and an effect sufficient to cause a significant impairment of
the refinery operations.” To implement these components, DOE created a dual-index
scoring matrix. One index measures disproportionate structural and economic
impact; the other, RFS compliance on refiner viability. The viability index has three
metrics—3a (“Compliance cost eliminates efficiency gains”), 3b (“Individual special
events”), and 3c (“Compliance costs likely to lead to shut down”). DOE defines
“individual special events” as “Refinery specific events (such as a shutdown due to
an accident, and subsequent loss of revenue) in the recent past that have a temporary
negative impact on the ability of the refinery to comply with the RFS.” Originally,
-2-
DOE scored all three metrics as 0 or 10. In a May 2014 addendum to the study, DOE
added 5 as a possible score for metrics 3a and 3b (but not metric 3c).
Lion Oil, a small refinery in El Dorado, Arkansas, received exemptions through
2012. It petitioned EPA for an exemption for 2013. Citing disruption to a key supply
pipeline and noting its “financial position has not improved,” Lion Oil argued that
RFS compliance would cause disproportionate economic hardship.
Before EPA considered the petition, DOE first scored Lion Oil on DOE’s
matrix, as amended by the addendum. DOE determined that Lion Oil did not score
high enough on the viability index to show disproportionate economic hardship.
Specifically, on metric 3b, DOE concluded the pipeline disruption was not an
“individual special event” because “several refineries . . . were impacted by the
reduced flow.” (Lion Oil agrees that the pipeline disruption affected four other
refineries.)
EPA’s 23-page decision summarized DOE’s analysis, a “primary factor” in its
decision. EPA also said it “evaluate[d] viability . . . in the same manner that DOE
considers viability in its own methodology.” EPA did not re-score Lion Oil on
DOE’s matrix. Instead, EPA “independently” analyzed the pipeline disruption and
Lion Oil’s blending capacity, projected RFS-compliance costs, and financial position.
Lion Oil requested protection of “confidential business information.” EPA sent
its decision to Lion Oil only. At oral argument, Lion Oil’s counsel said, “It’s really
just the specific numbers, the dollar amounts, the numbers of [credits] that are
confidential.”
Lion Oil appealed to this court under 42 U.S.C. § 7607(b)(1). The statute
“lodges jurisdiction over challenges to ‘any . . . final [EPA] action’ in the Courts of
Appeals.” Alaska Dep’t of Envtl. Conservation v. E.P.A., 540 U.S. 461, 481 (2004),
-3-
quoting § 7607(b)(1). See also Whitman v. Am. Trucking Ass’ns, 531 U.S. 457, 477
(2001) (stating § 7607(b)(1) “gives the court jurisdiction”).
Section 7607(b)(1) has three parts. First, “A petition for review of . . . any
other nationally applicable regulations promulgated, or final action taken, by the
Administrator under this chapter may be filed only in the” D.C. Circuit. 42 U.S.C.
§ 7607(b)(1). Second, “A petition for review of the Administrator’s action . . . which
is locally or regionally applicable may be filed only in the United States Court of
Appeals for the appropriate circuit.” Id. Third, “Notwithstanding the preceding
sentence a petition for review of any action [that is locally or regionally applicable]
may be filed only in the [D.C. Circuit] if such action is based on a determination of
nationwide scope or effect and if in taking such action the Administrator finds and
publishes that such action is based on such a determination.” Id.
Lion Oil also appealed to the D.C. Circuit, which is holding that appeal in
abeyance pending this court’s decision. EPA then moved to dismiss this appeal,
arguing the D.C. Circuit has exclusive authority to hear Lion Oil’s appeal. This court
took EPA’s motion with the case. This court also granted Lion Oil’s unopposed
motion to seal EPA’s decision and the parties’ joint motion to file their briefs and
appendix under seal.
II.
The parties agree that EPA’s petition-denial is locally or regionally applicable,
not nationally applicable. This court may hear a petition unless the denial “is based
on a determination of nationwide scope or effect and if in taking such action the
Administrator finds and publishes that such action is based on such a determination.”
See id.
-4-
In its decision, EPA stated, “This decision is a final agency action of
nationwide scope and effect for purposes of [§ 7607(b)(1)].” EPA sent the decision
to Lion Oil only. EPA made no announcement in any public record, including its
website.
EPA argues, “Lion Oil’s petition may only be heard in the D.C. Circuit because
EPA has made an express and unambiguous determination of nationwide scope or
effect.” Lion Oil counters that EPA did not publish the necessary finding. Even if
EPA published a finding, Lion Oil argues this court must independently conclude that
EPA’s action “is based on a determination of nationwide scope or effect.”
Section 7607(b)(1) does not define “publishes.” The parties do not cite cases
or legislative history interpreting the term. “When a term is undefined, we give it its
ordinary meaning.” United States v. Santos, 553 U.S. 507, 511 (2008) (analyzing
dictionary definitions of “proceeds” for purposes of money-laundering statute). The
ordinary meaning of “publish” requires some public distribution. See Webster’s
International Dictionary 1837 (3d ed. 1961) (defining “publish” as “to declare
publicly: make generally known”); Black’s Law Dictionary 1428 (10th ed. 2014)
(defining “publish” as “[t]o distribute copies (of a work) to the public”). See also
Webster’s International Dictionary 1836 (3d ed. 1961) (defining “public” as “of,
relating to, or affecting the people as an organized community”).
EPA does not assert a different meaning of “publish.” Instead, EPA argues for
an exception because it honored Lion Oil’s request to protect certain confidential
business information. But the plain language of § 7607(b)(1) permits no exception,
and EPA cites no evidence of congressional intent to provide one.
At oral argument, EPA requested a remand “to allow the agency to follow the
required procedure.” Section § 7607(b)(1) is plain: An appeal of EPA action “which
is locally or regionally applicable may be filed only in” the regional circuit unless, at
-5-
least, “the Administrator finds and publishes that such action is based on” a
determination of nationwide scope or effect. See 42 U.S.C. § 7607(b)(1). Under the
ordinary meaning of “publish,” EPA must make public distribution of its decision, not
just to the petitioner.
This court may hear Lion Oil’s appeal because EPA did not publish the
necessary finding.1
III.
This court “shall . . . hold unlawful and set aside agency action, findings, and
conclusions found to be . . . arbitrary, capricious, an abuse of discretion, or otherwise
not in accordance with law.” 5 U.S.C. § 706(2)(A). “[D]ue account shall be taken
of the rule of prejudicial error.” § 706. This court “shall decide all relevant questions
of law, interpret constitutional and statutory provisions, and determine the meaning
or applicability of the terms of an agency action.” Id.
1
While § 7607(b)(1) “gives the court jurisdiction,” Whitman, 531 U.S. at 477,
the parties treat § 7607(b)(1) as a venue provision. See Texas Mun. Power Agency
v. E.P.A., 89 F.3d 858, 867 (D.C. Cir. 1996) (“Given the less than clear language, the
structure of the section—dividing cases among the circuits—and the legislative
history indicate that [§ 7607(b)(1)] is framed more as a venue provision.”). Because
EPA failed to publish a finding, this court need not reach whether § 7607(b)(1),
particularly its third sentence, is also a venue provision—just as this court need not
decide whether EPA’s action “is based on a determination of nationwide scope or
effect.”
-6-
A.
Lion Oil argues that DOE’s “scoring decision [on metric 3b] was flawed, and
EPA acted arbitrarily and capriciously in using it is as a basis for its rejection of Lion
Oil’s petition.”
“An agency decision is arbitrary or capricious if: the agency has relied on
factors which Congress has not intended it to consider, entirely failed to consider an
important aspect of the problem, offered an explanation for its decision that runs
counter to the evidence before the agency, or is so implausible that it could not be
ascribed to a difference in view or the product of agency expertise.” El Dorado
Chem. Co. v. E.P.A., 763 F.3d 950, 955-56 (8th Cir. 2014). “The scope of our review
is narrow and we are not to substitute our judgment for that of the agency.” Id. at
956, citing Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins.
Co., 463 U.S. 29, 43 (1983).
EPA did not arbitrarily use DOE’s scoring decision. Rather, EPA did as
Congress directed—“in consultation with the Secretary of Energy, [EPA]
consider[ed] the findings of [DOE’s] study.” See 42 U.S.C. § 7545(o)(9)(B)(ii). EPA
said DOE’s analysis was a “primary factor” in EPA’s decision. EPA “evaluate[d]
viability . . . in the same manner that DOE considers viability in its own
methodology.” EPA then “independently” analyzed the pipeline disruption, noting
it “affected several other refineries, and thus was not a ‘special event’ specific to
Lion.” EPA also contextualized the disruption’s impact on Lion Oil’s financial
position.
Lion Oil claims DOE’s scoring “was flawed.” To the extent Lion Oil can
challenge DOE’s scoring on metric 3b, it was proper. The study defined “individual
special events” as “Refinery specific events (such as a shutdown due to an accident,
and subsequent loss of revenue) in the recent past that have a temporary negative
-7-
impact on the ability of the refinery to comply with the RFS.” Lion Oil agrees that
the disruption affected four other refineries. By the study’s definition, the disruption
was not “refinery specific.”
B.
Lion Oil’s other arguments focus on DOE’s addendum. Because EPA, not
DOE, is the respondent, Lion Oil’s theme is that DOE’s scoring was “outcome-
determinative.” Even if DOE’s scoring was “outcome-determinative,” Lion Oil fails
to show how the availability of an intermediate score prejudiced Lion Oil. See 5
U.S.C. § 706.
1.
Lion Oil argues that the addendum was unlawful because it was not adequately
explained. An agency must “provide reasoned explanation for its action” and “show
that there are good reasons for the new policy.” F.C.C. v. Fox Television Stations,
Inc., 556 U.S. 502, 515 (2009). “But it need not demonstrate to a court’s satisfaction
that the reasons for the new policy are better than the reasons for the old one; it
suffices that the new policy is permissible under the statute, that there are good
reasons for it, and that the agency believes it to be better, which the conscious change
of course adequately indicates.” Id.
In the addendum, DOE said metrics 3a and 3b measure “impacts that may occur
across a continuum, and providing for the possibility of an intermediate score allows
DOE to more accurately assess an individual refinery’s economic situation.” In its
decision denying Lion Oil’s petition, EPA noted, “DOE added a 5 as a possible
intermediate score . . . to more accurately characterize the impacts of compliance
costs (3a) or individual special events (3b) on a refinery.”
-8-
Lion Oil argues that DOE and EPA offered “not an explanation for the change
but merely a description of it.” To the contrary, DOE and EPA provided a “reasoned
explanation” and “good reasons.” See id. The intermediate score “allows for more
nuanced and accurate characterization of the” refinery’s situation. See Hermes
Consol., LLC v. E.P.A., 2015 WL 3461360, at *5, *10 (D.C. Cir. June 2, 2015)
(vacating EPA’s denial of small refinery’s exemption petition because EPA conceded
it made two miscalculations about petitioner’s financial data).
2.
Lion Oil argues that the addendum required notice-and-comment rulemaking.
“Agencies must conduct ‘rule making’ in accord with the [Administrative Procedure
Act’s] notice and comment procedures.” Iowa League of Cities v. E.P.A., 711 F.3d
844, 855 (8th Cir. 2013). See 5 U.S.C. § 553 (“Rule making”). “However, only new
‘legislative’ rules are required to be created pursuant to notice and comment
rulemaking,” not “interpretative rules” or “general statements of policy.” Iowa
League of Cities, 711 F.3d at 855.
According to Lion Oil, the addendum is “a legislative rule” because EPA “gave
[the addendum] conclusive effect.” Lion Oil cites General Electric Company v.
E.P.A., 290 F.3d 377, 383 (D.C. Cir. 2002): “[A]n agency pronouncement will be
considered binding as a practical matter if it either appears on its face to be binding,
or is applied by the agency in a way that indicates it is binding.”
Lion Oil’s factual premise fails. EPA did not give the addendum “conclusive
effect,” nor could it, as EPA does not score petitions on DOE’s matrix. Rather, EPA
did as Congress directed—“in consultation with the Secretary of Energy, [EPA]
consider[ed] the findings of [DOE’s] study . . . and other economic factors.” See 42
U.S.C. § 7545(o)(9)(B)(ii). EPA said DOE’s analysis was a “primary factor” in
EPA’s decision, and EPA “evaluate[d] viability . . . in the same manner that DOE
-9-
considers viability in its own methodology.” EPA also “independently” analyzed the
pipeline disruption and Lion Oil’s blending capacity, projected RFS-compliance
costs, and financial position. See Hermes, 2015 WL 3461360, at *6 (rejecting
argument that addendum required notice-and-comment rulemaking because petitioner
“points us to no authority suggesting that the decision to make available a more
refined score within an already-existing metric requires notice-and-comment
procedures” and finding “no basis for creating such a rule”).
3.
Lion Oil argues that EPA unreasonably interpreted “disproportionate economic
hardship” to mean long-term viability, particularly as credits became more costly.
“Where a statute does not define a term, and Congress has delegated authority to an
agency to implement an ambiguous statute, we are required to accept the agency’s
statutory interpretation, so long as it is reasonable.” Fast v. Applebee’s Int’l, Inc.,
638 F.3d 872, 876 (8th Cir. 2011), citing Chevron, U.S.A., Inc. v. Natural Res. Def.
Council, Inc., 467 U.S. 837, 844-45 (1984).
EPA’s interpretation of “disproportionate economic hardship” is reasonable.
“[T]he relative costs of compliance alone cannot demonstrate economic hardship
because all refineries face a direct cost associated with participation in the program.
Of course, some refineries will face higher costs than others, but whether those costs
impose disproportionate hardship on a given refinery presents a different question.”
Hermes, 2015 WL 3461360, at *5. EPA adopted DOE’s determination “that the best
way to measure ‘hardship’ entailed examining the impact of compliance costs on a
refinery’s ability to maintain profitability and competitiveness—i.e., viability—in the
long term.” Id. “[T]hat choice lies well within the agency’s discretion.” Id.
-10-
4.
Lion Oil argues the addendum’s “arbitrariness . . . is heightened by EPA’s
failure to apply the revised scoring methodology consistently.” Lion Oil cites a letter
from EPA to the D.C. Circuit in the Hermes case. There, EPA acknowledged that
DOE gave some pre-addendum petitioners a 5 for metrics 3a and 3c—when a 5 was
not yet an option (and still is not for metric 3c).
Again, EPA, not DOE, is the respondent here. Lion Oil does not show that
EPA relied on DOE’s scoring decisions in those petitions. Even if EPA did, Lion Oil
was not prejudiced. See 5 U.S.C. § 706.
*******
EPA’s denial of Lion Oil’s petition is affirmed.
______________________________
-11-
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238 So.2d 916 (1970)
Mack OLIVER
v.
STATE.
6 Div. 12.
Court of Criminal Appeals of Alabama.
August 25, 1970.
J. Mason Davis, Birmingham, for appellant.
MacDonald Gallion, Atty. Gen., and David W. Clark, Asst. Atty. Gen., for the State.
ALMON, Judge.
Mack Oliver was convicted of illegal possession of marijuana and sentenced to fifteen years in the penitentiary.
*917 He contends the trial court erred in denying his pre-trial motion to suppress the marijuana, alleging that it was seized in an illegal search and further that the court should have granted his motion to exclude the State's evidence.
The affidavit sworn to by Joseph B. Jones, a detective for the City of Birmingham, which led the magistrate to issue the search warrant is as follows:
"(Describe Property) Marijuana and certain other amphetamines and barbiturates a more particular description of which is not obtainable by affiant, and that (Name or Describe Person) Mack Oliver whose name or description is otherwise unknown to affiant, is guilty thereof, and that said property is located or situated as follows: (Describe Place to be Searched) Premises of 1036 9th Avenue South, Birmingham, Jefferson County, Alabama, a better description of which location or premises is unknown to affiant and that the facts tending to establish the foregoing ground for the issuance of a search warrant are as follows: (Set out Facts Tending to Establish Ground for Issuance of Warrant) On 5 August 1967 an amount of marijuana was purchased at 1036 9th Ave. So. Birmingham, Jefferson County, Alabama. This purchaser observed this portion being removed from a larger amount of what we believe to be marijuana. This larger amount of marijuana was still at this address when the purchaser left."
At the pre-trial hearing to suppress, Detective Jones testified as follows:
"A. I was present, Detective Swindal was present, and I don't recall for sure about the other two, and another officer named Barnard Dunlap was present.
"Q. All right, sir. I want you to tell the Court, if you will, Detective Jones, what if anything you told to Lieutenant Wilson, the issuing magistrate with respect to why you wanted a warrant?
"A. I told him that Officer Dunlap had been to 1036 9th Avenue South.
"Q. Did you tell him when he had been there?
"A. That night.
"Q. All right.
"A. Just a few minutes prior to our conversation, and he made a purchase of $5.00 of marijuana, and he saw some additional marijuana on the mantle, and in a sack, or jar, and had a matchbox in it that he measured out what this officer had bought.
"MR. COLLINS: Judge I am going to except to this, and move that it be excluded. This is all hearsay.
"THE COURT: This officer here is testifying that he told the man who gave the warrant this, and that the other officer was present at the time. Isn't that what you are saying?
"THE WITNESS: Yes, sir.
"MR. COLLINS: You are not testifying to anything firsthand, this is information that was given to you, right?
"THE COURT: By the officer who is alleged to have been present at the time the information was given to the warrant officer over there, Lieutenant Wilson, is that correct?
"THE WITNESS: Yes, sir. Dunlap was there, and Lieutenant Wilson was there, and I was there, and Detective Swindal was there.
"MR. COLLINS: I wasn't aware that you were claiming that Officer Dunlap was there at the time.
"MR. WILKINSON: May it please the Court, it doesn't make any difference if Officer Dunlap was there, or not, if this is what he told the magistrate.
*918 "THE COURT: From a reliable informant.
"MR. WILKINSON: Yes, sir.
* * * * * *
"Q. Well, let me phrase the question this way: Did Officer Dunlap relate to you why he had gone to this particular address to make a purchase?
"A. He was working with Detective Swindal, and Hayes at the time as an undercover officer. What may have took place before he was back in the City Hall, I don't know.
"Q. As an undercover officer?
"A. Yes, sir.
* * * * * *
"Q. (BY MR. COLLINS:) Detective Jones, let me ask you this: Did you actually request the aid of these other officers on this night in question, or occasion in question to assist you in executing this search warrant?
"A. No. I didn't request their aid. They requested mine.
"Q. Do you want to explain that a little bit. You are the one that got the search warrant, didn't you?
"A. You are the one asking the questions.
"Q. You have answered it to my satisfaction.
"A. They were working on the case, and after it developed to this stage they called me into it, and explained what had taken place, and then, I asked for the search warrant in order to go back and look for more.
"Q. In other words, as you stated previously, it was they who requested your assistance rather than you requesting theirs?
"A. That's right.
"Q. In executing this search warrant?
"A. They had already worked it up to a buy, and had delivered it back to the City Hall before I became involved in it. Does that explain it?
* * *
"Q. All right. Subsequent to your telling the magistrate that, did he then sign the warrant?
"A. Right.
"Q. And you were the affiant on the warrant, is that correct?
"A. Right.
"Q. After he signed the warrant, did you in the company of some other officers then go to 1036 9th Avenue South in the City of Birmingham?
"A. We did."
Armed with this search warrant, Detectives Jones, Swindal and Hayes and Lt. Myers went to appellant's apartment at 1036 Ninth Avenue, South. They arrived at approximately 10:30 P.M. Jones and Hayes went to the front door. Myers went around the right side of the house and Swindal the left. While Jones and Hayes were knocking on the front door, Swindal heard someone opening a window on the left side of the house. Upon looking in that direction, he saw appellant at the window attempting to drop something out. Swindal testified that he "got beside the house, and as he dropped this sack I caught it." After examining the sack and determining that it contained marijuana, Swindal continued on to the back of the house and entered the back door by pulling the latch off what was apparently a screen door and breaking an inner door. The search of appellant's apartment did not reveal any drugs. After the search, appellant was arrested.
This affidavit unaided by the oral testimony of Detective Jones is insufficient. Aguilar v. Texas, 378 U.S. 108, 84 S.Ct. 1509, 12 L.Ed.2d 723.
*919 Tit. 15, § 103, Code of Alabama, 1940, is as follows:
"The magistrate, before issuing the warrant, must examine on oath the complainant and any witness he may produce, and take their depositions in writing, and cause them to be subcribed by the persons making them; and the depositions must set forth facts tending to establish the grounds of the application, or probable cause for believing that they exist."
Thus, the question presented is whether the allegations in an affidavit made to secure a search warrant may be supplemented by oral testimony given before the issuing magistrate. The decisions on this question are not in complete accord. In Edmunds v. State, 199 Ala. 555, 74 So. 965 (1917), our Supreme Court said:
"Although, following the provisions common to all search warrants and preliminary proceedings, the act requires that `the magistrate before issuing a warrant must examine the complainant on oath, and any other witnesses he may produce, * * * and take their deposition in writing, and cause the same to be subscribed by the person or persons making them' (section 22, subd. 3), the omission of these requirements has never been regarded as vitiative of the warrant when it is issued upon a sufficient affidavit.
"`The ascertainment of probable cause for the issue of the writ involved the exercise of the judicial function. Having acquired and exercised jurisdiction in the premises by taking the affidavit of a person, and having issued the warrant substantially as required by the statute, the weight of the evidence to establish probable cause could not be made the subject of inquiry, nor could the judgment in that regard of the issuing magistrate be made the subject of review on the trial of the cause.' Toole v. State, 170 Ala. 41, 52, 54 South. 195, 198; Cheek v. State, 3 Ala.App. 646, 57 South. 108; Salley v. State, 9 Ala.App. 82, 64 South. 185."
In Porch v. State, 38 Ala.App. 565, 89 So.2d 694, cert. denied 265 Ala. 699, 89 So. 2d 698 (1956), a prosecution for possession of prohibited liquors, it was contended by defense counsel that § 214 of Tit. 29 had not been complied with; thus, rendering the search warrant invalid. More specifically, defense counsel contended that since the record showed that the magistrate did not take the deposition of the complaining witness and cause him to sign it, no facts were set forth tending to establish the application for the warrant on probable cause. After citing Edmunds, supra, the court ruled there was no merit in this contention.
Even though Edmunds and Porch, supra, were referring to Tit. 29, § 214, instead of Tit. 15, § 103, with which we are presently concerned, these statutes are almost identical and have been held to be considered in pari materia. Jordan v. State, 39 Ala.App. 469, 103 So.2d 815.
In Knox v. State, 42 Ala.App. 578, 172 So.2d 787, cert. denied 277 Ala. 699, 172 So.2d 795 (1965), the court stated as follows:
"However, if the affidavit, on its face, is found by the trial judge to be insufficient to support a finding of probable cause, as illustrated in Jones v. United States, 362 U.S. 257, 80 S.Ct. 725, 4 L.Ed. 2d 697, the State may then adduce testimony showing that sufficient evidence was, in fact, before the issuing magistrate upon which a finding of probable cause could be based. Insofar as inconsistent with this opinion, the decisions cited above, principally Toole v. State, must be deemed to have been overturned by the cited opinions of the Supreme Court of the United States."
In Clenney v. State, 281 Ala. 9, 198 So.2d 293 (1966), we find:
"The rule seems to be that the magistrate must have sufficient evidence to support a finding of probable cause. Apparently, it is not necessary that all the evidence before the magistrate shall be *920 stated in the affidavit, but, since the Court of Appeals holds the affidavit insufficient on its face, we limit consideration to matters stated in the affidavit."
In Brandies v. State, 44 Ala.App. 648, 219 So.2d 404 (1969), there is language indicating that the judge who issued the search warrant could not be called as a witness to testify that he had other evidence before him which was not reduced to writing. Yet in the same opinion on rehearing, we find:
"Aside from this aspect we would point out that our comment on the search warrant, strictly speaking, was not ratio decidendi. Rather it was a mere pronouncement by way of gratuitous dictum, advisory in nature. This because a ruling on this point was not necessary to dispose of this appeal.
"Should the State consider that we will ultimately be held to be wrong by the Supreme Court of Alabama, as to the meaning of § 103, supra, then if Brandies is reindicted and tried, it is true that we in strict analysis have not positively ruled. However, as of now, we think that we have given the proper construction to our statute."
In Myrick v. State, 45 Ala.App. 162, 227 So.2d 448 (1969), we find:
"In Tyler v. State, 45 Ala.App. 155, 227 So.2d 442 (Oct. 7, 1969), we noted that Code 1940, T. 15, § 103 requires that each witness before the magistrate issuing the search warrant must have his testimony reduced to a written deposition to be subscribed by the witness. In that case, the magistrate had had other witnesses before him whose testimony was not put in writing.
"In the case of instant concern, there was but one witness so far as this record shows. The only infirmity in the affidavit which led to the issuance of the warrant was the failure of the affiant to expressly label his informer as one who had previously furnished reliable information. See Jones v. United States, 362 U.S. 257, 80 S.Ct. 725, 4 L.Ed.2d 697. Here, on examination in the circuit court, Camp, the affiant, testified that his informer had been previously shown to be reliable.
"In Knox v. State, 42 Ala.App. 578, 172 So.2d 787(1), we indicated that it was possible to supply the deficiencies in an affidavit if, in fact, additional oral evidence was laid before the issuing magistrate. In Brandies v. State, 44 Ala.App. 648, 219 So.2d 404, and Tyler we indicated that such oral evidence must, nevertheless, to the extent required by § 103 of T. 15, supra, be reduced to writing. Thus, from these three opinions, it can be deduced that there must be a written deposition for each witness before the issuing magistrate.
"However, § 103, supra, in describing the minimal content of such a deposition says it `must set forth facts tending to establish the grounds of the application, or probable cause for believing that they exist' Thus, in this case, the deficiency is not one of substance but one of establishing fully the credibility of the informer. In turn, such a showing is a collateral matter somewhat analogous to the establishing by way of voir dire examinations of the competency of a proffered witness who is suspected of being a lunatic or too young to testify."
A review of the above decisions indicates a lack of uniformity on this point. Each time our Supreme Court has alluded to this problem it has approved the use of oral testimony in aid of a defective affidavit. Yet, the decisions of the Court of Appeals seem to be in conflict. Compare Porch, supra, with Myrick, supra. It is my view that oral testimony should be admissible to cure an otherwise defective affidavit.
Could it have been logically argued that due to the failure of a committing magistrate (in conformity with Tit. 15, § 135, Code of Alabama, 1940, now repealed by Act No. 1106, Special and Regular Sessions, *921 1969) to reduce the evidence to writing, a defendant who has been bound over to the grand jury must be released. I think not. Similarly, the failure of an issuing magistrate to comply with Tit. 15, § 103, should not vitiate an otherwise valid search warrant.
It should be remembered that prior to Mapp v. Ohio, 367 U.S. 643, 81 S.Ct. 1684, 6 L.Ed.2d 1081, evidence was admissible at trial, with the exception of liquor cases (Tit. 29, § 210, Code of Alabama, 1940) regardless of the manner of seizure. To strictly construe Tit. 15, § 103, so as to prevent a reviewing court from considering oral testimony given before an issuing magistrate is but to engraft an additional state requirement on the already strict federal search and seizure rules now made mandatory on state courts.
This holding in no way infringes upon Fourth Amendment rights, since applicants for search warrants must still supply the magistrate with sufficient facts for the magistrate to conclude that there is probable cause.
For cases in other jurisdictions in accord with this view see Marshall v. State, 113 Ga.App. 143,147 S.E.2d 666; State v. Titus, 107 N.H. 215, 220 A.2d 154; State v. Mark, 46 N.J. 262, 216 A.2d 377.
The following facts were before the magistrate:
1. That a few minutes ago an amount of marijuana was purchased at appellant's premises at 1036 9th Avenue, South, Birmingham, Jefferson County, Alabama.
2. The purchaser observed the marijuana which he purchased being removed from a larger amount of what he believed to be marijuana.
3. This larger amount of marijuana was still at this address when the purchaser left.
4. The purchaser was Officer Dunlap with the City of Birmingham who had been working as an undercover agent with Detectives Swindal and Hayes.
5. Officer Dunlap had related these facts to affiant.
Search warrants may be issued on hearsay information and need not reflect the direct personal observations of the affiant. Jones v. United States, 362 U.S. 257, 80 S.Ct. 725, 4 L.Ed.2d 697. The magistrate must be informed, however, of (1) some of the underlying circumstances from which the informant concluded that the narcotics were where he claimed they were, and (2) some of the underlying circumstances from which the officer concluded that the informant was credible or his information reliable. Aguilar v. Texas, supra.
Here, the underlying circumstances are simply that Officer Dunlap was a police officer who had just purchased marijuana.
We conclude, therefore, that the specific requisites of probable cause laid down in Aguilar, supra; Spinelli v. United States, 393 U.S. 410, 89 S.Ct. 584, 21 L.Ed.2d 637; Clenney v. State, supra; and Davis v. State, 286 Ala. 117, 237 So.2d 640 Ms. June 11, 1970, have been met with respect to this search warrant.
There is no necessity to consider the manner in which the officers entered appellant's apartment since the subsequent search revealed nothing incriminating.
For the foregoing reasons, the judgment appealed from is due to be and the same is hereby
Affirmed.
CATES, Judge (concurring).
No longer can a trial court slam the door on reexamining what a court of summary jurisdiction says is enough to back up his handing a constable a warrant. Edmunds v. State, 199 Ala. 555, 74 So. 965, on this point was overruled in Knox v. State, 42 *922 Ala.App. 578, 172 So.2d 787 which has been approved by our Supreme Court.
I concur because the marijuana was thrown away before the search began. Hayes v. State, 44 Ala.App. 539, 215 So.2d 604. Therefore, the validity of the warrant is not needful for us to pass on.
Nor are we at the right fork in the road to follow Act No. 100 of August 24, 1964[1] or to hold it bad.
NOTES
[1] But see State v. Furmage, 250 N.C. 616, 109 S.E.2d 563; State v. Paulick, 277 Minn. 140, 151 N.W.2d 591; and State v. Ruotolo, 52 N.J.2d 508, 247 A.2d 1.
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Error: Couldn't open file '/var/www/court-listener/alert/assets/media/pdf/2010/05/19/In_Re_Oracle_Corp.pdf': No such file or directory.
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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-0774-17T2
212 MARIN BOULEVARD, LLC,
247 MANILA AVENUE, LLC, 280
ERIE STREET, LLC, 317 JERSEY
AVENUE, LLC, 354 COLE STREET,
LLC, 389 MONMOUTH STREET,
LLC, 415 BRUNSWICK STREET,
LLC, and 446 NEWARK AVENUE,
Plaintiffs,
v.
CHICAGO TITLE INSURANCE
COMPANY,
Defendant/Third-Party
Plaintiff-Appellant,
v.
VESTED TITLE INC. and
SUSAN L. KRUGER,
Third-Party Defendants,
and
CONSOLIDATED RAIL
CORPORATION,
Third-Party Defendant-
Respondent.
_______________________________
Argued December 18, 2018 – Decided January 23, 2019
Before Judges Fisher, Geiger and Firko.
On appeal from Superior Court of New Jersey, Law
Division, Hudson County, Docket No. L-5801-09.
John A. Piskora argued the cause for appellant (Loeb &
Loeb, LLP, attorneys; John A. Piskora and Lindsay S.
Feuer, on the briefs).
William D. Wallach argued the cause for respondent
(McCarter & English, LLP, attorneys; William D.
Wallach, on the brief).
PER CURIAM
This is the second time this matter has come before us. On the first
occasion, we affirmed a partial summary judgment that concluded defendant
Chicago Title Insurance Company was obligated to defend plaintiffs' title to
Jersey City property conveyed to plaintiffs by third-party defendant
Consolidated Rail Corporation. 212 Marin Blvd., LLC v. Chicago Title Ins. Co.,
No. A-3877-12 (App. Div. May 20, 2015) (slip op. at 2). Following that
determination, plaintiffs and Chicago Title settled their differences, and the
latter proceeded on its claims against Conrail. At the conclusion of a bench trial,
the judge found Chicago Title was not entitled to any relief. In explaining why
A-0774-17T2
2
we affirm the judge's rejection of Chicago Title's negligent-misrepresentation
claim against Conrail, we start by briefly describing the history of this
conveyance and the litigation that followed.
In ruling on Chicago Title's first appeal, we provided this overview of the
circumstances and the parties' disputes:
[O]n June 24, 2003, [Conrail] and SLH Holding
Corporation (SLH) entered into a contract whereby
Conrail agreed to sell SLH approximately 6.2 acres of
real property, eight parcels in total, located on Sixth
Street in Jersey City. SLH assigned its rights to
plaintiffs, eight [LLCs] with the same sole member,
Victoria Peslak Hyman, a Florida resident.
The property included a former railroad facility called
the Sixth Street embankment, which was created in the
early 1900's, and which consists of a series of elevated
structures made of earth-filled stone retaining walls
connected by bridges. Conrail had used part of the
embankment as a turnaround space for trains until
1994. By 1997, all tracks and bridges on the
embankment had been removed, the embankment was
no longer used as a railway, and the facility was
dismantled.
Prior to entering into the contract, Conrail sought and
obtained the agreement of the New Jersey Department
of Transportation to waive regulatory filings and
publication requirements. Prior to closing, plaintiffs
advised Chicago Title's agent, Vested Title, of the
railway issues, and inquired whether Vested Title
anticipated any problems with closing. Vested Title
requested more information.
A-0774-17T2
3
On July 11, 2005, Conrail advised plaintiffs that: the
embankment was a "spur track"; in light of 49 U.S.C.A.
§ 10906, the Surface Transportation Board (STB) had
no authority over it; and, consequently, no formal
abandonment of the property needed to be filed.
Plaintiffs provided this information to Vested Title.
On July 12, 2005, Conrail delivered eight quitclaim
deeds to plaintiffs for the eight parcels in exchange for
$3 million. Vested Title then issued eight policies, one
for each parcel, effective July 18, 2005, that provided
indemnity coverage of $3 million . . . with unlimited
defense coverage. Specifically, the policies obligated
Chicago Title to defend plaintiffs in any litigation in
which a third-party asserted a claim adverse to
plaintiffs' title.
[Id. at 3-4.]
After closing, plaintiffs sought subdivision approval from the Jersey City
Planning Board. Relief was denied because the board concluded Conrail "failed
to receive STB approval to abandon the railway." Id. at 5.
The board's determination gave rise to plaintiffs' action in lieu of
prerogative writs; in response, the City of Jersey City filed a counterclaim,
asserting the conveyances from Conrail to plaintiffs were void ab initio because
Jersey City was not given notice of the sale pursuant to an alleged right of first
refusal. Ibid. Jersey City also petitioned the STB for an order declaring that
Conrail was required to obtain the STB's authorization to abandon the
A-0774-17T2
4
embankment; plaintiffs intervened in that action, arguing the embankment was
a spur track that didn't require authorization. Id. at 5-6.
In August 2007, the STB held the property was not a spur track but a rail
line subject to its jurisdiction until abandonment was authorized. Id. at 6. This
prompted further legal proceedings in federal courts in the District of Columbia,
see City of Jersey City v. Consol. Rail Corp., 668 F.3d 741 (D.C. Cir. 2012);
Consol. Rail Corp. v. Surface Transp. Bd., 571 F.3d 13 (D.C. Cir. 2009); City
of Jersey City v. Consol. Rail Corp., 968 F. Supp. 2d 302 (D.D.C. 2013).
Plaintiffs commenced this action in November 2009, seeking a declaration
that their title policies obligated Chicago Title to defend their title. In April
2011, a judge 1 granted summary judgment in plaintiffs' favor and awarded some
of the counsel fees they sought. That judge also certified as final the orders
memorializing those determinations, so Chicago Title filed an appeal and
plaintiffs filed a cross-appeal. Although troubled by the arguably inappropriate
certifying of those orders, we nevertheless deemed it more efficient to consider
the merits of the parties' arguments. 212 Marin Blvd., slip op. at 9. Ultimately,
we concluded that the judge correctly found Chicago Title was obligated to
1
The judge whose rulings were questioned in the first appeal is not the same
judge who tried and decided the third-party action prosecuted by Chicago Title
against Conrail.
A-0774-17T2
5
defend plaintiffs' title, id. at 18, and we found no abuse of discretion in the
judge's disposition of the fee requests regarding the other lawsuits, id. at 20. In
ruling on the cross-appeal, however, we found the judge erred in denying
plaintiffs an award of fees in connection with their prosecution of this coverage
action and in denying a request for prejudgment interest without explanation.
Id. at 28.
After our disposition of the appeal and cross-appeal, and after the Supreme
Court denied certification, 212 Marin Blvd., LLC v. Chicago Title Ins. Co., 223
N.J. 280 (2015), plaintiffs and Chicago Title amicably settled their dispute; their
January 2016 settlement called for the dismissal of plaintiffs' claims in exchange
for Chicago Title's payment to plaintiffs of $5,000,000.
Following the settlement, Chicago Title's third-party complaint against
Conrail was prosecuted. Chicago Title sought relief from Conrail based on a
variety of contribution and indemnification claims, as well as fraud and
negligent misrepresentation. These claims were the subject of a two-day bench
trial in April 2017. On August 31, 2017, the trial judge rendered a written
decision and, a few weeks later, entered final judgment dismissing Chicago
Title's claims against Conrail with prejudice.
A-0774-17T2
6
Chicago Title appeals, arguing the trial judge erred "by applying an
incorrect legal standard to [its] claim for negligent misrepresentation" and "by
misconstruing the established facts and making erroneous legal conclusions
concerning Conrail's actionable misrepresentations of fact." In finding no error
in his application of settled legal principles and in deferring to the judge's
findings of fact, we reject Chicago Title's arguments and affirm, substantially
for the reasons provided by Judge Jeffrey R. Jablonski in his thorough and well-
reasoned written opinion. We add only the following additional comments.
In considering its arguments in this appeal, our focus rests largely on
Chicago Title's claim that Conrail negligently misrepresented the property was
not subject to the STB's abandonment authority. 2 This tort theory, as our
2
Chicago Title has not pursued its fraud claim in this appeal. We also find its
common-law contribution and indemnification claims lack support in the
evidence. By settling with its insureds in an amount that does not distinguish
between that part of the settlement that incorporates damages for the alleged tort
and those falling outside Conrail's alleged responsibility, Chicago Title lost the
right of contribution against any joint tortfeasor based on that settlement.
Sattelberger v. Telep, 14 N.J. 353, 367 (1954) (finding it "incumbent" on such
a contribution claimant "to establish a common liability for the wrongful act,
neglect or default made the basis of the judgment and the quantum of the
damages ensuing from the joint offense"); accord Young v. Steinberg, 53 N.J.
252, 255 (1969). Chicago Title was obligated to demonstrate, in its negligent-
misrepresentation claim, that it was found responsible for the alleged joint tort
and entitled to Conrail's share of that responsibility. By relying on the
settlement paid to plaintiffs, Chicago Title failed to establish these legal
A-0774-17T2
7
Supreme Court has made plain, requires proof of "[a]n incorrect statement,
negligently made and justifiably relied upon." Rosenblum v. Adler, 93 N.J. 324,
334 (1983); see also Green v. Morgan Properties, 215 N.J. 431, 457 (2013);
Kaufman v. i-Stat Corp., 165 N.J. 94, 109 (2000); Masone v. Levine, 382 N.J.
Super. 181, 187 (App. Div. 2005). We consider two aspects of this common-
law tort: whether the statement in question was false or incorrect and whether
Chicago Title justifiably relied on it. In examining these questions, we assume
for present purposes that the Conrail statement that forms the basis for this claim
was conveyed with the expectation it would reach Chicago Title, even though
the statement was not made to Chicago Title but to its agent, Vested Title. 212
Marin Blvd., slip op. at 4.
Chicago Title chiefly claims a July 11, 2005 email sent by Conrail's
counsel to Vested Title prior to the closing contained false statements. That
email advised that "[t]he properties abandoned constituted 'spur tracks' over
which the STB and previously the ICC had no authority pursuant to 49 U.S.C. §
requirements because that settlement included sums not within the scope of
Conrail's alleged responsibility. And Chicago Title couldn't pursue common-
law indemnification from Conrail because Conrail was not in a "special
relationship" with Chicago Title, the insurer of the parties to whom Conrail was
conveying property. See Ramos v. Browning Ferris Indus., Inc., 103 N.J. 177,
188-89 (1986).
A-0774-17T2
8
10906" and stated that "no formal abandonment of the property was ever filed."
This email was not shown at trial to be false when made or, for that matter, even
now. Although the reach of the STB's abandonment authority may have been
the subject of litigation in other courts, as noted earlier, no definitive
adjudication on that assertion has yet occurred.
The hotly-contested dispute between Jersey City and Conrail that
followed the latter's sale of the property to plaintiffs has only been resolved in
the most indirect way; abandonment authority has simply been assumed – never
really declared – because of a stipulation ultimately reached. To briefly recount,
the STB determined at the administrative level that it possessed abandonment
authority over the property. In 2010, the United States District Court for the
District of Columbia did not reach that question because it found Jersey City
lacked standing to seek such a ruling. City of Jersey City v. Consol. Rail Corp.,
741 F. Supp. 2d 131, 149 (D.D.C. 2010). The United States Court of Appeals
for the District of Columbia, however, reversed that standing determination and
remanded to the district court for further proceedings. City of Jersey City, 668
F.3d at 746. Only then did Jersey City and plaintiffs stipulate that the property
"was conveyed to Conrail as a line subject to [the] STB's abandonment
jurisdiction"; Conrail did not stipulate this fact, it only agreed to let it go
A-0774-17T2
9
unchallenged. City of Jersey City, 968 F. Supp. 2d at 304-05.3 Conrail's
decision not to challenge the stipulation of abandonment authority is not the
equivalent of a concession. More to the point, there is nothing about the
stipulation that would suggest Conrail's contrary opinion years earlier – when
the property was conveyed to Chicago Title's insureds – was inaccurate; the
stipulation merely resolved the key factual dispute in Jersey City's federal
claims. In other words, a 2012 stipulation that allowed the federal action to
proceed to the next stage 4 was hardly conclusive of the dispute here: whether
Conrail misrepresented the reach of the STB's abandonment authority to the
property in question in 2005.
In short, the question posed by Chicago Title's negligent
misrepresentation action against Conrail required proof that Conrail's statement
3
Precisely, the district judge observed that, in July 2012, "the parties filed a
joint stipulation in which plaintiffs [i.e., Jersey City, Rails to Trails
Conservancy, and Pennsylvania Railroad Harsimus Stem Embankment
Preservation Coalition] and intervenor-defendants [plaintiffs here] stipulated
that the Harsimus Branch was conveyed to Conrail as a line subject to the STB's
abandonment jurisdiction. They further stipulated that defendant Conrail and
intervenor Attorney General of New Jersey would not raise any facts or
arguments in opposition to that stipulation." 968 F. Supp. 2d at 304-05.
4
The summary judgment entered in favor of Jersey City was later affirmed by
the court of appeals by way of an unpublished order. City of Jersey City v.
Conrail, No. 13-7175, 2014 U.S. App. LEXIS 3067 (D.C. Cir. Feb. 19, 2014).
A-0774-17T2
10
was false when made. On that point, the trial judge, as fact finder, was entitled
to determine that Conrail's July 11, 2005 email was a statement of opinion and
not of fact. Although it is true that it has been said an alleged false statement
for these purposes "need not be a factual report, but may consist of an expert
opinion," Rosenblum, 93 N.J. at 334 (quoting Pabon v. Hackensack Auto Sales,
Inc., 63 N.J. Super. 476, 497 (App. Div. 1960)), we think it clear that the
Supreme Court had in mind something different than an expression of opinion
on a question so Byzantine that it confounded the federal courts for more than a
decade and was only resolved when some combatants stipulated the fact and
others, including Conrail, agreed not to dispute the stipulated fact.
This conclusion also dovetails with the trial judge's finding of an absence
of persuasive evidence that Chicago Title justifiably relied on the July 2005
email in issuing title insurance for plaintiffs' benefit. Conrail agreed in June
2003 – nearly two years before the email – to convey the property in its
"condition as of the date of Closing, including any violations of law," and
without any representation as to the quality of Conrail's title. Vested Title issued
the title commitment on behalf of its principal, Chicago Title, in 2004, and, as
noted, the email was not sent until two days before the closing. The trial judge
was entitled to conclude from these circumstances and from the testimony he
A-0774-17T2
11
found credible that Chicago Title was not "detrimentally and prejudicially
induced" into relying on the July 2005 email. In reaching this conclusion, the
judge relied on what he described as the "credible testimony" of Conrail's
counsel. He found that testimony "both reasoned and logical" and "entirely
consistent with the documentary evidence," which revealed "the conveyance
was legally permissible without the necessity to secure abandonment permission
and specifically that the properties abandoned constituted spur tracks" over
which the STB had no abandonment authority.
The judge also found credible and persuasive the testimony of Conrail's
director of real estate. The judge found this witness testified "consistently,
directly, and credibly." He determined the real estate director "belie[ved]" at
the time of the closing that the premises consisted of
a spur track rather than a rail line for which it was [the
witness's] belief that no abandonment authorization
would be necessary[,] [that] Conrail used and treated
the parcel as a yard and switching track[, that] [t]he
portion of the parcel at issue . . . was separate from any
line of railroad that served the area[, and that] Conrail
never downgraded the area, since the area had already
been downgraded.
The real estate director also testified about discussions in March 1994
concerning demolition of the area and it was then determined there was no need
for abandonment approval.
A-0774-17T2
12
Not only was the judge persuaded by the credible testimony of Conrail's
witnesses, but he also concluded that Chicago Title provided "no credible proof
. . . that either party knew that the parcel was a designated rail line." The judge
found the July 2005 email simply expressed "an opinion" as to what Conrail
believed – based on all surrounding circumstances – at the time of the
transaction and that it could not adequately support Chicago Title's negligent-
misrepresentation claim.
Our standard of review requires that we defer to the judge's factual
findings and credibility determinations in reviewing his conclusion that Chicago
Title failed to establish all the elements of its negligent-misrepresentation claim.
Rova Farms Resort, Inc. v. Inv'rs. Ins. Co., 65 N.J. 474, 484 (1974); accord
Thieme v. Aucoin-Thieme, 227 N.J. 269, 282-83 (2016); Zaman v. Felton, 219
N.J. 199, 215-16 (2014).
Affirmed.
A-0774-17T2
13
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"pile_set_name": "FreeLaw"
} |
FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
MASSA SINGH,
Petitioner, No. 05-74817
v.
Agency No.
A92-293-501
MICHAEL B. MUKASEY, Attorney
General, OPINION
Respondent.
On Petition for Review of an Order of the
Board of Immigration Appeals
Argued and Submitted
March 10, 2008—San Francisco, California
Filed July 23, 2008
Before: Stephen Reinhardt, John T. Noonan, Jr. and
Raymond C. Fisher, Circuit Judges
Opinion by Judge Fisher
9099
SINGH v. MUKASEY 9101
COUNSEL
Robert B. Jobe (argued) and Fatma Marouf, Law Offices of
Robert B. Jobe, San Francisco, California, for the petitioner.
Patricia A. Smith (argued), Office of Immigration Litigation,
Emily Anne Radford and Peter D. Keisler, Assistant Attorney
General, Department of Justice, Washington, D.C., for the
respondent.
9102 SINGH v. MUKASEY
OPINION
FISHER, Circuit Judge:
This appeal concerns the right of a criminal alien who was
ordered removed before the enactment of the REAL ID Act
of 2005 to obtain judicial review of his removal order after
the Act became effective on May 11, 2005. Before the REAL
ID Act, “criminal aliens” could obtain judicial review only
through a habeas corpus petition filed with the district court.
After the Act, these aliens — like all aliens — may obtain
judicial review only through a petition for review in the court
of appeals, and the petition must be filed within 30 days of the
issuance of a final order of removal. Petitioner Massa Singh
(“Singh”) filed his current petition for review on August 17,
2005, more than two years after his order of removal became
administratively final and more than three months after the
REAL ID Act was enacted. The government argues that we
lack jurisdiction to consider his untimely petition for review.
For the reasons that follow, we hold that the REAL ID Act
must be construed to give aliens whose removal order became
final before the REAL ID Act a reasonable opportunity to
obtain judicial review. However, we hold that aliens whose
petitions were rendered untimely by the Act had a grace
period of no more than 30 days from the effective date of the
Act in which to seek such review. Because Singh’s petition
was filed more than 30 days after the REAL ID Act was
signed into law, we dismiss his petition.
I.
Singh is a native and citizen of India who has been a legal
permanent resident of the United States since 1990. In 2003,
the Department of Homeland Security (“DHS”) charged
Singh with being a removable alien by reason of having com-
mitted an aggravated felony. See 8 U.S.C. § 1227(a)(2)(A)(iii)
(providing for removal of an alien convicted of an aggravated
SINGH v. MUKASEY 9103
felony, as defined by § 1101(a)(43)(A)).1 Singh disputed the
charge of removability and applied for various forms of relief
from removal, including relief under former Section 212(c) of
the Immigration and Nationality Act, asylum and withholding
of removal under the Act and the Convention Against Torture.
The immigration judge (“IJ”) sustained the charge of removal,
finding that Singh had been convicted of an aggravated fel-
ony, and denied Singh any relief from removal. Singh
appealed to the Board of Immigration Appeals (“BIA”),
which affirmed in July 2004.
At the time the BIA dismissed Singh’s appeal, the Illegal
Immigration Reform and Immigrant Responsibility Act of
1996 (“IIRIRA”) stripped the courts of appeals of their juris-
diction to consider petitions for review brought by “criminal
aliens,” including individuals such as Singh. See Pub. L. No.
104-208, Div. C, § 306, 110 Stat. 3009-546, 3009-647, codi-
fied at 8 U.S.C. § 1252(a)(2)(C) (2000).2 These aliens could,
instead, obtain judicial review of their removal orders by fil-
ing a habeas corpus petition with the district court under 28
U.S.C. § 2241. See INS v. St. Cyr, 533 U.S. 289, 305-14
(2001). This bifurcated system meant that criminal aliens pro-
ceeded down one path to review and non-criminal aliens
down another. The system’s complexities were even greater
for those aliens who disputed whether they were, in fact,
properly ordered deported as criminal aliens. These aliens had
to file a petition for review first, then the court of appeals
would, in the exercise of its “jurisdiction to determine [its]
own jurisdiction,” decide whether the individual was, in fact,
a criminal alien subject to the jurisdictional bar. See Ye v. INS,
1
Hereinafter, all citations are to Title 8 of the United States Code unless
otherwise noted.
2
Section 1252(a)(2)(C) (2000) provided that “[n]otwithstanding any
other provision of law, no court shall have jurisdiction to review any final
order of removal against an alien who is removable by reason of having
committed a criminal offense covered in section . . . 1227(a)(2)(A)(iii) . . .
of this title. . . .”
9104 SINGH v. MUKASEY
214 F.3d 1128, 1131 (9th Cir. 2000). Only after the petition
for review had been dismissed for lack of jurisdiction could
the alien then file a petition for habeas corpus in the district
court and bring other legal challenges to his removal order.
See Acevedo-Carranza v. Ashcroft, 371 F.3d 539, 542 (9th
Cir. 2004).
After Singh’s removal order became final, Singh dutifully
started down this path to judicial review. In August 2004, he
filed a timely petition for review in this court, arguing that his
misdemeanor conviction for committing a lewd and lascivious
act upon a child was not an aggravated felony for purposes of
immigration law. On February 15, 2005, we held that Singh
was an aggravated felon and dismissed his petition for review
for lack of jurisdiction, citing IIRIRA’s jurisdiction-stripping
provisions. Singh v. Gonzales, No. 04-73907 (9th Cir. Feb.
15, 2005). Singh does not dispute that at that point he was free
to file a habeas corpus petition in the district court at any time
if he wished to make any legal or constitutional challenges to
his order of removal. He did not do so. He was also not under
any time pressure to do so. Habeas corpus petitions under
§ 2241, unlike petitions for review, may be filed by any indi-
vidual “in custody under or by authority of the United States”
and are not subject to a timely filing requirement. See 28
U.S.C. § 2241(c)(1).
So things stood for Singh until May 11, 2005, when Presi-
dent Bush signed into law the REAL ID Act of 2005
(“RIDA”), Pub. L. No. 109-13, Div. B, 119 Stat. 231, codified
as amended at 8 U.S.C. § 1252. Section 106(a) of RIDA elim-
inated habeas corpus as an avenue of review for aliens seek-
ing to challenge a final order of removal, making petitions for
review in the courts of appeals the “sole and exclusive means
for judicial review” of a removal order. See § 1252(a)(5). At
the same time, Congress restored jurisdiction to the courts of
appeals over petitions for review brought by criminal aliens,
creating a unitary path of review for criminal and non-
criminal aliens alike. See § 1252(a)(2)(D) (permitting review
SINGH v. MUKASEY 9105
of “constitutional claims or questions of law” raised by any
alien in a petition for review); see also Puri v. Gonzales, 464
F.3d 1038, 1041-42 (9th Cir. 2006) (describing how RIDA
created jurisdiction over criminal aliens’ petitions for review).
Importantly, however, Congress did not modify the require-
ment that petitions for review must be filed within 30 days of
the issuance of a final order of removal by the BIA. See
§ 1252(b)(1).
RIDA ensured that on a forward-going basis, all aliens
could obtain judicial review if they filed a petition for review
within 30 days of their final order of removal. RIDA was less
clear, however, in addressing the position of aliens who were
caught up in the transition — namely, aliens such as Singh,
whose orders of removal became final more than 30 days
before RIDA, but who could not have filed a petition for
review until after RIDA. Congress provided that all currently
pending habeas corpus petitions should be transferred to the
courts of appeals and treated as timely filed petitions for
review, but it did not provide any mechanism for review for
aliens who did not have a habeas corpus petition pending. See
RIDA § 106(c). If the 30-day filing requirement were applied
to Singh, his opportunity to seek judicial review was already
foreclosed on the day RIDA became law. Congress therefore
overnight moved Singh from the position of having an unlim-
ited amount of time to seek review through a habeas corpus
petition, to having no ability to seek review at all.
Finding his right to file a habeas corpus petition suddenly
withdrawn, Singh sought to obtain review of his removal
order in the Ninth Circuit Court of Appeals after RIDA
became law in May 2005. On July 6, 2005, he asked us to
recall our mandate on his previously dismissed petition for
review, arguing that we should now exercise jurisdiction in
light of RIDA. We ultimately denied his request to recall the
mandate, but before we did, he filed a second petition for
review on August 17, 2005, which is the one we consider
here. In this petition he argues that RIDA provides us with
9106 SINGH v. MUKASEY
jurisdiction to consider his legal and constitutional claims
against his removal order. He further argues that if RIDA
does not provide such jurisdiction, he would be without any
opportunity for judicial review of his removal order in viola-
tion of the Suspension Clause of the Constitution. He there-
fore urges us to read RIDA in a way that would preserve
judicial review and avoid this constitutional pitfall.
II.
A.
[1] The Suspension Clause provides that “[t]he Privilege of
the Writ of Habeas Corpus shall not be suspended, unless
when in Cases of Rebellion or Invasion the public Safety may
require it.” U.S. Const. art. 1, § 9, cl. 2. The Supreme Court
has held that “[b]ecause of that Clause, some judicial inter-
vention in deportation cases is unquestionably required by the
Constitution.” St. Cyr, 533 U.S. at 300 (internal quotation
marks omitted). Judicial intervention need not occur through
a writ of habeas corpus, however. Congress may eliminate the
writ without running afoul of the Suspension Clause so long
as it provides “a collateral remedy which is neither inadequate
nor ineffective to test the legality of a person’s detention.”
Swain v. Pressley, 430 U.S. 372, 381 (1977); see also St. Cyr,
533 U.S. at 314 n.38 (“Congress could, without raising any
constitutional questions, provide an adequate substitute [for
habeas corpus] through the courts of appeals.”). An adequate
substitute for habeas corpus must fulfill the traditional role of
the writ, which is to give the petitioner “a meaningful oppor-
tunity to demonstrate that he is being held pursuant to ‘the
erroneous application or interpretation of relevant law.’ ”
Boumediene v. Bush, 128 S. Ct. 2229, 2266 (2008) (quoting
St. Cyr, 533 U.S. at 302). A petition for review with the court
of appeals constitutes “an adequate substitute for district court
habeas corpus jurisdiction.” Puri, 464 F.3d at 1042; see also
Mohamed v. Gonzales, 477 F.3d 522, 526 (8th Cir. 2007)
(holding that a petition for review is “an adequate substitute”
SINGH v. MUKASEY 9107
for habeas corpus); Alexandre v. U.S. Att’y Gen., 452 F.3d
1204, 1206 (11th Cir. 2006) (per curiam) (same).
[2] Whether RIDA created an adequate substitute for
habeas corpus for those aliens to whom a petition for review
is available, however, is different from whether RIDA created
any adequate substitute for those aliens for whom it is no lon-
ger available. Unlike in previous cases where we have upheld
RIDA against Suspension Clause challenges, Singh never had
the ability to obtain judicial review of the merits of his
removal through a petition for review filed within 30 days of
his removal order. Cf. Puri, 464 F.3d at 1043; Iasu v. Smith,
511 F.3d 881, 888 (9th Cir. 2007) (holding that RIDA’s elimi-
nation of habeas corpus does not violate the Suspension
Clause where the petitioner “had a means for seeking relief
(direct review) . . . . [and] simply failed to pursue the relief
that the statutory scheme allows”). By the time RIDA created
jurisdiction in this court over Singh’s petition for review,
more than 30 days had elapsed since his final order of
removal was entered, and so his petition would appear barred
by the timely filing requirement. See § 1252(b)(1).
The government argues that, in enacting RIDA, Congress
simply did not intend that aliens such as Singh have a way of
obtaining judicial review. The government notes that Con-
gress provided a mechanism to transfer pending habeas peti-
tions to the courts of appeals, indicating that Congress
considered the plight of aliens whose time to file a petition for
review had expired, and chose to protect only those who had
already acted affirmatively to preserve their rights. See RIDA
§ 106(c). Singh argues, to the contrary, that Congress’ express
purpose in enacting RIDA was to provide all aliens with some
mechanism for review of their constitutional and legal claims.
Applying the 30-day timely filing requirement to bar his
claim would both contravene Congress’ intent as well as vio-
late the Suspension Clause. He therefore suggests that we
have jurisdiction to consider his petition for review, seem-
ingly irrespective of when it was filed.
9108 SINGH v. MUKASEY
[3] Both the Second and Third Circuits have recently con-
sidered the exact question presented here. In Kolkevich v.
Att’y Gen., 501 F.3d 323, 335 (3d Cir. 2007), the Third Cir-
cuit concluded that depriving aliens such as Singh of all right
to judicial review would “risk running afoul of the Suspension
Clause,” and that RIDA does not evince a clear intent to elim-
inate these aliens’ right to review. The Second Circuit adopted
the same analysis in Ruiz-Martinez v. Mukasey, 516 F.3d 102
(2d Cir. 2008). We now join these circuits in holding that
RIDA should not be construed to have eliminated all possibil-
ity of judicial review for aliens, such as Singh, who did not
have the opportunity to file a petition for review before
RIDA. To accept that Congress eliminated habeas corpus
without providing these aliens with any substitute for review
would pose serious Suspension Clause concerns. See St. Cyr,
533 U.S. at 300.
[4] Contrary to the government’s suggestion here, there is
no clear language in the statute to suggest that “Congress took
the extraordinary step of suspending the writ with respect to
those who, like [petitioner], received final orders of removal
more than 30 days prior to the Act’s enactment.” Kolkevich,
501 F.3d at 334. Rather, the RIDA amendments form a
“patchwork of different statutes that, individually, have no
direct effect on [petitioner’s] appeal.” Id. at 335. In particular,
the 30-day timely filing requirement for petitions for review
predated RIDA, and there is no indication that Congress
intended this provision to block review for aliens who could
not have obtained review before RIDA’s enactment. Because
RIDA does not “express a clear and unambiguous statement
of Congress’ intent” to deprive Singh of judicial review, we
hold that RIDA does not foreclose that opportunity. See St.
Cyr, 533 U.S. at 299-300 (“[I]f an otherwise acceptable con-
struction of a statute would raise serious constitutional prob-
lems, and where an alternative interpretation is fairly possible,
we are obligated to construe the statute to avoid such prob-
lems.”) (internal quotation marks and citation omitted).
SINGH v. MUKASEY 9109
We draw support for this conclusion from the legislative
history of RIDA. As the Third Circuit explained, “RIDA’s
legislative history makes clear that, rather than intending it to
deprive aliens of judicial review, Congress saw the Act as a
vehicle by which it could ensure that all aliens received an
equal opportunity to have their challenges heard.” Kolkevich,
501 F.3d at 335. The House Report accompanying RIDA
states that
[u]nder section 106, all aliens who are ordered
removed by an immigration judge will be able to
appeal to the BIA and then raise constitutional and
legal challenges in the courts of appeals. No alien,
not even criminal aliens, will be deprived of judicial
review of such claims. Unlike AEDPA or IIRIRA,
which attempted to eliminate judicial review of
criminal aliens’ removal orders, section 106 would
give every alien one day in the court of appeals, sat-
isfying constitutional concerns. The Supreme Court
has held that in supplanting the writ of habeas corpus
with an alternative scheme, Congress need only pro-
vide a scheme which is an ‘adequate and effective’
substitute for habeas corpus . . . . By placing all
review in the courts of appeals, [RIDA] would pro-
vide an ‘adequate and effective’ alternative to habeas
corpus.
H.R. Rep. No. 109-72, at 174-75, U.S. Code Cong. & Admin.
News 2005, pp. 240, 299-300 (internal citations omitted)
(emphasis added) (hereinafter “House Report”). This lan-
guage makes clear that Congress not only intended to provide
“all aliens” with a right to review, it also shows that Congress
drafted RIDA to comply with the requirements of the Suspen-
sion Clause and the Supreme Court’s holding in St. Cyr. See
id. (emphasis added); see also Kolkevich, 501 F.3d at 335,
Ruiz-Martinez, 516 F.3d at 117.
9110 SINGH v. MUKASEY
B.
[5] Our conclusion that RIDA should not be construed to
deprive Singh of all right to judicial review does not, how-
ever, define the contours of that right. Even if Congress
intended to allow a criminal alien to file a petition for review
after the effective date of RIDA, this does not determine “how
much time he should be afforded in which to do so.”
Kolkevich, 501 F.3d at 336. That Congress did not intend to
extinguish Singh’s right to obtain judicial review completely
does not mean Congress intended to give him an unlimited
amount of time in which he could seek it. In addressing this
very question, the Third Circuit concluded that aliens for
whom a petition for review was previously unavailable should
have no more than a 30-day “grace period” from the enact-
ment of RIDA — that is, until June 11, 2005 — in which they
could file a petition for review. See id. at 337. The Second
Circuit adopted a similar rule. See Ruiz-Martinez, 516 F.3d at
117.
[6] Congress may subject an alien’s right to review to rea-
sonable procedural limitations such as filing deadlines, which
necessarily have the effect of cutting off the rights of those
who do not act in a timely fashion. See Stone v. INS, 514 U.S.
386, 405 (1995); Magtanong v. Gonzales, 494 F.3d 1190,
1191 (9th Cir. 2007) (per curiam). “[V]ehicles for review . . .
are not available indefinitely without limitation.” Daniels v.
United States, 532 U.S. 374, 381 (2001). Even a constitutional
right “may be forfeited . . . by the failure to make timely
assertion of the right before a tribunal having jurisdiction to
determine it.” United States v. Olano, 507 U.S. 725, 731
(1993) (quoting Yakus v. United States, 321 U.S. 414, 444
(1944)). Singh does not dispute that non-criminal aliens seek-
ing judicial review before RIDA, and criminal aliens seeking
review after RIDA, lose their right to review if they do not
bring a timely petition for review, and that such a limitation
on the availability of review is not inconsistent with the Sus-
pension Clause.
SINGH v. MUKASEY 9111
[7] In determining what constitutes a reasonable window of
time in which Singh should be allowed to bring his appeal, we
are strongly influenced by Congress’ desire in enacting RIDA
to equalize the rights of criminal and non-criminal aliens and
facilitate the removal of criminal aliens from the United
States. In the House Report that accompanied RIDA, Con-
gress criticized the bifurcated system of review that resulted
from the Supreme Court’s interpretation of IIRIRA in St. Cyr.
Specifically, Congress noted that
[a]mong the many problems caused by St. Cyr, the
most significant is that this decision allows criminal
aliens to delay their expulsion from the United States
for years.
Furthermore, because of St. Cyr, aliens who have
committed serious crimes in the United States are
generally able to obtain more judicial review than
non-criminal aliens. . . . Not only is this result unfair
and illogical, but it also wastes scarce judicial and
executive resources.
House Report at 298-99. Thus if we were to allow a criminal
alien such as Singh an unlimited amount of time to bring his
petition for review, when a similarly situated non-criminal
alien would have had only 30 days from the date of the final
order of removal to bring his petition, we would frustrate
Congress’ purpose. Therefore, we join the Second and Third
Circuits in holding that aliens in Singh’s position should “be
afforded 30 days from the date of RIDA’s enactment to bring
their claims — that is, until June 11, 2005.” Kolkevich, 501
F.3d at 337; see also Ruiz-Martinez, 516 F.3d at 117.
[8] Applying this rule to Singh’s case, we lack jurisdiction
to consider his petition for review. Singh’s present petition
was filed on August 17, 2005, more than three months after
RIDA was enacted. Singh urges us to adopt a different rule in
his case, arguing that he had no notice that his petition for
9112 SINGH v. MUKASEY
review needed to be filed within 30 days of RIDA’s enact-
ment. The signing into law of RIDA on May 11, 2005, how-
ever, put Singh on sufficient notice that jurisdiction over his
petition now rested with the court of appeals and that he
would need to act promptly to obtain review. RIDA funda-
mentally changed the system of judicial review for criminal
aliens, withdrawing habeas corpus from the district courts and
restoring jurisdiction in the courts of appeals. Congress did
not, however, amend the 30-day timely filing requirement,
indicating that Congress still expected aliens to act quickly to
preserve their rights. Yet Singh did not seek to recall the man-
date on his first petition for review for nearly two months
after RIDA, and did not file the current petition until nearly
a month after that. We are not unsympathetic to the uncertain-
ties Singh faced with RIDA’s enactment, and are mindful of
the efforts his counsel made to deal with them. Nonetheless,
we believe the 30-day rule is reasonable and we cannot
exempt Singh from its consequences. His petition for review
was untimely, and must be dismissed for lack of jurisdiction.
See Kolkevich, 501 F.3d at 337.
III.
[9] Lastly, we reject Singh’s suggestion that we have
authority to construe his current petition for review as a peti-
tion for review nunc pro tunc, or as if it were filed on the date
of his first petition in August 2004. “Nunc pro tunc signifies
now for then, or in other words, a thing is done now, which
shall have the same legal force and effect as if done at [the]
time when it ought to have been done.” United States v. Allen,
153 F.3d 1037, 1044 (9th Cir 1998) (quoting Black’s Law
Dictionary 964 (5th ed. 1979)). The doctrine is considered
part of the “inherent power of the court to make its records
speak the truth.” Id. We have emphasized that the power is
a limited one, and may be used only where necessary
to correct a clear mistake and prevent injustice. It
does not imply the ability to alter the substance of
SINGH v. MUKASEY 9113
that which actually transpired or to backdate events
to serve some other purpose. Rather, its use is lim-
ited to making the record reflect what the . . . court
actually intended to do at an earlier date, but which
it did not sufficiently express or did not accomplish
due to some error or inadvertence.
United States v. Sumner, 226 F.3d 1005, 1009-10 (9th Cir.
2000) (internal quotation marks and citations omitted); see
also Transamerica Ins. Co. v. South, 975 F.2d 321, 325 (7th
Cir. 1992) (noting that “a nunc pro tunc order is typically used
to correct clerical or ministerial errors,” but as a general rule
does not enable the court to make “substantive changes affect-
ing parties’ rights”). Singh’s earlier petition was not dis-
missed through any clerical mistake or error of law, but rather
was properly dismissed under the law as it existed at the time,
as Singh himself concedes. Singh points to no authority to
support his theory that we have authority to backdate his cur-
rent petition for review to the date of his earlier, properly dis-
missed petition for review.
CONCLUSION
Because Singh’s petition for review was not brought within
30 days of the enactment of RIDA, we lack jurisdiction to
consider his claims.
DISMISSED.
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992 S.W.2d 130 (1999)
66 Ark.App. 159
Patricia PATTERSON, Appellant,
v.
FRITO LAY, INC. and Lumbermen's Mutual Casualty Company, Appellee.
No. CA 98-1016.
Court of Appeals of Arkansas, Division I.
April 14, 1999.
*132 Ben E. Rice, Jacksonville, for appellant.
Rieves & Mayton, Lance Eric Newkirk, West Memphis, for appellees.
TERRY CRABTREE, Judge.
Patricia Patterson appeals the decision of the Workers' Compensation Commission reversing the administrative law judge's finding that she sustained a compensable bilateral knee injury as a result of rapid repetitive motion. Appellant argues that the Commission erred in finding: (1) that the activities performed were not rapid and repetitive; (2) that the work activities of the appellant were not the major cause of her gradual-onset injury; and (3) that there was no basis for finding that the testimony of the appellant and her corroborating witnesses was not credible. We agree and therefore reverse and remand the findings of the Workers' Compensation Commission.
The appellant worked as a store representative for Frito Lay beginning in late November 1994. For a year prior to that, she worked as a swing store representative before her promotion to her current position. Goldie Powell, appellant's supervisor, explained that a store representative has more overall responsibilities than a swing store representative. Appellant contends that she developed her bilateral knee problems as a result of her employment after her promotion in November 1994. She discontinued working in March of 1995 due to the problems she was experiencing with her knees and sought medical treatment for her knee conditions at that time. Although she was having problems with both knees, only the left knee is at issue here.
At the hearing held on June 27, 1997, appellant contended that her left knee problems resulted from rapid repetitive motion of her left knee and were therefore a compensable injury. Conversely, the appellee contended that appellant's left knee problems were not compensable under Act 796. The full Commission found that the appellant did not meet all requirements for gradual-onset injuries. Such injuries are controlled by Ark.Code Ann. § 11-9-102(5)(A)(ii) *133 (Supp.1997), which states that an employee must prove by a preponderance of the evidence that she sustained internal or external damage to her body as a result of an injury that arose out of and in the course of employment, the employee must establish the compensability of a claim with medical evidence, and that evidence must be supported by objective findings. Arkansas Code Ann. § 11-9-102(5)(A)(ii) sets forth exceptions in which the employee must also prove that the "resultant condition is compensable only if the alleged compensable injury is the major cause of the disability or need for treatment." Furthermore, Ark.Code Ann. § 11-9-102(5)(A)(ii)(a), the specific provision governing this claim, requires the appellant to prove that the injury was caused by "rapid repetitive motion."
This court reviews decisions of the Workers' Compensation Commission to see if they are supported by substantial evidence. Deffenbaugh Indus. v. Angus, 39 Ark.App. 24, 832 S.W.2d 869 (1992).[1] Substantial evidence is that relevant evidence which a reasonable mind might accept as adequate to support a conclusion. Wright v. ABC Air, Inc., 44 Ark.App. 5, 864 S.W.2d 871 (1993). The issue is not whether this Court might have reached a different result from that reached by the Commission, or whether the evidence would have supported a contrary finding. This court will not reverse the Commission's decision unless fair-minded persons considering the same facts could not have reached the same conclusion. Golden v. Westark Community College, 333 Ark. 41, 969 S.W.2d 154 (1998). It is the function of the Commission to determine the credibility of the witnesses and the weight to be given their testimony.[2]Jeter v. B.R. McGinty Mechanical, 62 Ark.App. 53, 968 S.W.2d 645 (1998). However, the Commission may not arbitrarily disregard any witness's testimony. Swift-Eckrich, Inc. v. Brock, 63 Ark.App. 118, 975 S.W.2d 857 (1998). It is the responsibility of the Commission to draw inferences when the testimony is open to more than a single interpretation, whether controverted or uncontroverted, and when it does so, its findings have the force and effect of a jury verdict. Service Chevrolet v. Atwood, 61 Ark.App. 190, 966 S.W.2d 909 (1998). The Commission is not required to believe the testimony of the claimant or any other witness. The testimony of an interested party is always considered to be controverted. Continental Express v. Harris, 61 Ark.App. 198, 965 S.W.2d 811 (1998). Even though the Commission is insulated to a certain degree from appellate review, its decisions are not insulated to the degree it would make appellate review meaningless. Jordan v. J.C. Penney Co., 57 Ark.App. 174, 944 S.W.2d 547 (1997). Furthermore, benefits are not always denied to a claimant who has been untruthful.[3]Boyd v. General Industries, 22 Ark. App. 103, 733 S.W.2d 750 (1987).
The appellant asserts that the Commission erred when it found that the appellant's work activities were not "rapid and repetitive" as required by statute. The Commission evidently took the testimony of the appellant as true that she spent 40% of her time on her knees moving back and forth stocking the lower shelves. However, because the appellant went to four different stores, the Commission concluded that she only spent 10% of her time on her knees. This logic is flawed and there is no basis in the record *134 for the conclusion reached by the Commission. The appellant and two other witnesses testified to a greater percentage of the time that the appellant was required to work on her knees. Even the sole witness for the appellee indicated a higher percentage. We are firmly convinced that this conclusion of the Commission was in error. Based on our opinion that the Commission's determination that the appellant was not in a position putting pressure on her knees for more than 10% of the time was error, we must now turn to whether the appellant's movements were rapid and repetitive.
The Commission concluded that the appellant's testimony concerning the number of back and forth movements was not credible, but even if it were, the Commission opined that the facts are more similar to the facts in Lay v. United Parcel Service, 58 Ark.App. 35, 944 S.W.2d 867 (1997) than in other cases, namely, Kildow v. Baldwin Piano & Organ, 58 Ark.App. 194, 948 S.W.2d 100 (1997) (reversed on other grounds Kildow v. Baldwin Piano & Organ, 333 Ark. 335, 969 S.W.2d 190 (1998)), and Rudick v. Unifirst Corp., 60 Ark.App. 173, 962 S.W.2d 819(1998). The facts in the Lay case are dissimilar to the facts of this case. In Lay, the UPS driver had long periods of time that he had to drive between locations. Further, the appellant's injury was to his elbow, which was not placed and used in an unusual position. While the appellant in this case had breaks in between the times that she was on her knees stocking the shelves, the times that she was on her knees she was, out of necessity, moving back and forth. Just as in Baysinger v. Air Systems, Inc., 55 Ark.App. 174, 934 S.W.2d 230 (1996), we feel the Commission's interpretation of what is rapid and repetitive is too restrictive. The Commission must consider the positioning of the part of the body as well as the number of movements the claimant has to undergo to determine if the movement is "rapid and repetitive." In this case, the Commission's analogy of the appellant's movements to that of a person "standing on one's feet taking small steps from side to side to side" is clearly not applicable to the facts of this case. While stepping from side to side on one's feet is a normal function, resting on one's knees moving back and forth is not a normal function of the knee.
We are concerned with the statement in the Commission's opinion that the claimant's testimony is never considered uncontroverted (citing Nix v. Wilson World Hotel, 46 Ark.App. 303, 879 S.W.2d 457 (1994); Lambert v. Gerber Products Co., 14 Ark.App. 88, 684 S.W.2d 842 (1985)). We recognize that we have held on numerous occasions that a party's testimony is never considered uncontroverted. However, the Commission's opinion seems to indicate that only the claimant's testimony is never considered uncontroverted. We would point out that Act 796 of 1993 requires that neither party be given the benefit of doubt. To consider one party's testimony always controverted without considering the same for the opposing party would fly in the face of this clear mandate.
Considering the flawed logic upon which the Commission based its opinion as to whether the appellant's movements were rapid and repetitive, we find that fair-minded people could not reach the same conclusion as the Commission and reverse the Commission's decision as to the first issue.
The appellant also asserts that the Commission erred in finding that the appellant failed to prove that the work activities were the major cause of her gradual onset injury. The Commission stated in its opinion, "Rather, all opinions addressing causation refer directly to claimant's work of standing on concrete floors 12 to 15 hours per day."
The appellant sought treatment from Charles W. Himmler on March 24, 1995. Dr. Himmler noted that the appellant suffered from rheumatoid arthritis and prescribed *135 anti-inflammatory medication as well as rest for two weeks. In a follow-up letter of April 27, 1995, Dr. Himmler again referred to rheumatoid disease and opined that the arthritis flared up because of excessive work hours. On June 23, 1995, Dr. Himmler noted that the appellant's knees were worse and that the original diagnosis of rheumatoid arthritis might have been incorrect. He also noted that there was no other joint involvement and that the problem might be overuse syndrome.
On August 8, 1995, the appellant consulted Dr. Abraham. Dr. Abraham agreed with Dr. Himmler that the appellant suffered from overuse syndrome and noted that the problem might have been triggered by her excessive standing on concrete floors.
Dr. Martin saw the appellant on October 24, 1995. Dr. Martin stated in a report that while the appellant was working for Frito Lay, she was required to do a lot of walking, standing and climbing. He also noted that the appellant's pain was much worse when she would get up from a sitting position with squatting, standing or stair climbing.
In his deposition, Dr. Martin testified as to the nature of the appellant's injury:
She had chondrosis, which means that the cartilage is disrupted, just on the back of the kneecap. The kneecap articulates with the end of the femur on the thigh bone, and anytime the knee is bent there is an increasing pressure on the knee cap at that articulation, sometimes a force up to six times the body weight just across the joint. The cartilage on the kneecap had cracks in it and was roughened up. It almost looks like crab meat that is hanging on the back side of the kneecap as opposed to the smooth cartilage surface.... The condition was chondrosis, which is a degeneration of sorts of the cartilage on the back of the kneecap due to wear and tear.
Sometimes we see this condition as a result of normal activities, but most often it's overuse, for example someone training for a marathon or someone working on weights and doing too many squats or just too many stairs, too many up-and-down motions, squatting.
When asked about causation, Dr. Martin testified that he could state with a reasonable degree of medical certainty that it "would be her work and the squatting activities that she was doing at the time."
We well understand that the Commission makes determinations of credibility. When the determination must be made between competing medical opinions, the Commission decides which to believe. However, in this case, the medical opinions are not opposed. Dr. Himmler initially diagnosed the appellant as suffering from arthritis but later determined that because the appellant's problem did not have other joint involvement, he questioned that diagnosis and felt it was more of an overuse syndrome. Later, this was substantiated by Dr. Abraham. The appellant was finally seen by Dr. Martin, who performed surgery on the appellant. He clearly stated that the overuse was due to activity that involved bending the knee. The medical opinions are not in conflict but demonstrate the development of a diagnosis that was appropriate for the appellant. There is no testimony whatsoever that Dr. Martin's diagnosis and treatment was incorrect. It is notable that Dr. Martin testified that the pressure on the knee where it articulated with the thigh femur was often six times greater than the person's body weight and that the injury was at the knee where the patella is next to the thigh femur. It is abundantly clear that the injury was a direct result of the appellant's work activities. We do not believe that fair-minded people could reach the same decision as the Commission on the second issue, and therefore reverse.
The final issue argued by the appellant is that there is no basis for the Commission's finding that the appellant and the appellant's witnesses were not credible. We agree. Again, we are well *136 aware of the long standing rule of law that the determination of the credibility of the witnesses and the weight given their testimony are matters exclusively within the province of the Commission. Graham v. Turnage Employment Group, 60 Ark.App. 150, 960 S.W.2d 453 (1998). However, the Commission is not totally insulated from judicial review on credibility issues. Jordan v. J.C. Penney Co., 57 Ark.App. 174, 944 S.W.2d 547 (1997). The Commission may not arbitrarily disregard the testimony of any witness. See Boyd v. Dana Corp., 62 Ark.App. 78, 966 S.W.2d 946 (1998). Where, as here, the appellant alleges that the Commission arbitrarily disregarded the testimony of witnesses, there must be some articulated fact in the Commission's opinion that supports its findings. In this case, there is none. The Commission merely stated that it had reviewed the record and determined that the appellant lacked credibility.
The Commission is limited to reviewing the record and, thus, the demeanor of the witnesses is not an issue. The Commission must glean from the record an indicia of credibility. Because it is limited to the record, the Commission must be able to clearly state the reasons for its determination of credibility, especially when that determination is contrary to the findings of the ALJ who actually observed the witnesses. We cannot discern from the abstract any indication that the witnesses were untruthful. In fact, the contrary is true. The testimony was reasonably consistent throughout, including the testimony of the sole witness for the appellee. Due to the fact that the Commission failed to state its reasons for its determination that the appellant lacked credibility, and the lack of evidence in the record to support such a finding, we conclude that the Commission arbitrarily disregarded the testimony of the witnesses and reached its conclusion based on speculation and conjecture.
Even if we were to conclude, which we do not, that the Commission properly found that the appellant lacked credibility, that would not end our inquiry. We must then look to the remaining evidence to see if the decision of the Commission is supported by substantial evidence and whether fair-minded people could reach the same decision as the Commission. Kuhn v. Majestic Hotel, 324 Ark. 21, 918 S.W.2d 158 (1996). We cannot conclude that they would. The remaining evidence would not support the decision of the Commission. As discussed supra, the Commission's analysis is flawed regarding its interpretation of whether the work activities of the appellant were rapid and repetitive and whether the injury was supported by objective medical findings. Considering the remaining evidence, it is clear that there is insufficient evidence to support the Commission's decision and that fair-minded people could not reach the same result.
We reverse the decision of the Commission and remand for an award of benefits.
GRIFFEN, and NEAL, JJ., agree.
NOTES
[1] This standard of review has been challenged several times but has been left unresolved by the Arkansas Supreme Court because the issue was not raised before the Commission. See Scarbrough v. Cherokee Enterprises, 306 Ark. 641, 816 S.W.2d 876 (1991).
[2] The fact that the ALJ's decision is not to be considered, even in regard to the credibility of witnesses, may very well be a violation of due process of law. However, we do not consider that issue because it was not raised below. See Scarbrough, supra.
[3] Obviously, if the claimant was untruthful regarding one of the essential elements of the claim, the claimant would not be able to meet his burden of proof.
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In The
Court of Appeals
Ninth District of Texas at Beaumont
____________________
NO. 09-07-496 CR
____________________
RUSSELL EARL GLUYAS, Appellant
V.
THE STATE OF TEXAS, Appellee
On Appeal from the 221st District Court
Montgomery County, Texas
Trial Cause No. 06-05-04470-CR
MEMORANDUM OPINION
A jury found Russell Earl Gluyas guilty of aggravated sexual assault of a child. See
Tex. Pen. Code Ann. § 22.021(a)(1)(B), (2)(B) (Vernon Supp. 2007). The trial court
sentenced Gluyas to thirty years of confinement in the Texas Department of Criminal
Justice, Correctional Institutions Division.
On appeal, Gluyas's counsel filed a brief that presents counsel's professional
evaluation of the record and concludes the appeal is frivolous. See Anders v. California,
386 U.S. 738, 87 S.Ct. 1396, 18 L.Ed.2d 493 (1967); High v. State, 573 S.W.2d 807
(Tex. Crim. App. 1978). On February 21, 2008, we granted an extension of time for the
appellant to file a pro se brief. We received no response from appellant.
We reviewed the appellate record, and we agree with counsel's conclusion that no
arguable issues support an appeal. Therefore, we find it unnecessary to order appointment
of new counsel to re-brief the appeal. Bledsoe v. State, 178 S.W.3d 824, 826-27 (Tex.
Crim. App. 2005); cf. Stafford v. State, 813 S.W.2d 503, 511 (Tex. Crim. App. 1991).
We affirm the trial court's judgment. (1)
AFFIRMED.
__________________________________
CHARLES KREGER
Justice
Submitted on May 28, 2008
Opinion Delivered June 11, 2008
Do not publish
Before McKeithen, C.J., Gaultney and Kreger, JJ.
1. Appellant may challenge our decision in this case by filing a petition for discretionary
review. See Tex. R. App. P. 68.
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641 F.3d 260 (2011)
UNITED STATES of America, Plaintiff-Appellee,
v.
Ronnie L. RICHMOND, Defendant-Appellant.
No. 10-2904.
United States Court of Appeals, Seventh Circuit.
Argued March 28, 2011.
Decided May 25, 2011.
Joseph H. Hartzler (argued), Attorney, Office of the United States Attorney, Springfield, IL, for Plaintiff-Appellee.
Robert A. Alvarado (argued), Attorney, Office of the Federal Public Defender, Peoria, IL, for Defendant-Appellant.
Before KANNE, SYKES, and HAMILTON, Circuit Judges.
*261 KANNE, Circuit Judge.
When Peoria Police Officer Richard Linthicum frisked Ronnie Richmond in the early hours of October 9, 2009, he found Richmond was carrying a revolver. Having been previously convicted in Illinois of a crime punishable by imprisonment for more than a year, Richmond was subsequently charged with violating 18 U.S.C. § 922(g) for carrying the firearm. Richmond conditionally pled guilty to the charge, reserving his right to appeal the denial of his motion to suppress evidence from the allegedly unlawful search. Because the district court did not err in concluding that the search was constitutional, we affirm.
I. BACKGROUND
Officer Linthicum, a nine-year veteran of the Peoria Police Department, was patrolling downtown Peoria around 3:30 a.m. on October 9, 2009. He observed five men walking near the federal courthouse at Monroe and Main Streets and stopped his squad car to watch them. One of the men, later identified as Richmond, stopped on the sidewalk and faced away from the squad car. While his friends continued on, Richmond remained there for approximately fifteen seconds with his hands and arms in front of him, thus blocked from the officer's sight. When Richmond turned and resumed walking, Officer Linthicum noticed a large bulge in Richmond's shirt that resembled a handgun handle hanging over his waistband.
Officer Linthicum turned a corner so that Richmond was walking toward the squad car. He rolled down the passenger window and called out to Richmond to come over and speak with him. Richmond walked toward the squad car, passing behind a row of newspaper boxes that obscured Officer Linthicum's line of sight. When Richmond reached the squad car, Officer Linthicum noticed that the waistline bulge was gone. After Richmond denied having any identification on him, Officer Linthicum asked Richmond his name. Perhaps because of his outstanding warrant and parolee status, Richmond lied. A database search through the squad car's mobile computer reported "no record on file," which Officer Linthicum knew to be particularly unusual and potentially indicative of a false name.
Officer Linthicum got out of the squad car and approached Richmond, asking him to place his hands behind his back. During a cursory pat-down, Officer Linthicum felt a handgun in Richmond's left rear pants pocket. He handcuffed Richmond, removed the snub-nose .38-caliber revolver and a black ski mask, and secured Richmond in the backseat of the squad car. Richmond then gave Officer Linthicum his correct name and date of birth. The subsequent database search revealed Richmond's outstanding warrant.
Richmond moved in limine to suppress the introduction of the revolver as the fruit of an unlawful search. At the suppression hearing, the district court noted that the police report had omitted some significant and material details, but it found Officer Linthicum to be a credible witness. The court described Richmond's conduct as "very suspicious under the circumstances" and found that Officer Linthicum had the requisite reasonable suspicion to make the frisk "reasonable under the circumstances and, therefore, lawful." The district court denied Richmond's motion to suppress, and he conditionally pled guilty to violating 18 U.S.C. § 922(g). He reserved the right to appeal the district court's ruling on his motion.
II. ANALYSIS
On appeal, Richmond contests neither the facts found by the district court nor the lawfulness of Officer Linthicum's initial investigatory stop. Richmond challenges *262 only the district court's conclusion that the facts known to Officer Linthicum could support the reasonable suspicion necessary to justify a pat-down frisk. In a case like this, "when `what happened?' is not at issue, the ultimate resolution of whether ... reasonable suspicion existed is a question of law which we review de novo." United States v. Carlisle, 614 F.3d 750, 754 (7th Cir.2010).
An officer may constitutionally stop and frisk an individual if two conditions are met. Arizona v. Johnson, 555 U.S. 323, ___, 129 S.Ct. 781, 784, 172 L.Ed.2d 694 (2009). "First, the investigatory stop must be lawful." Id. Richmond has not challenged the lawfulness of the initial stop in his case. Second, and germane to this appeal, "to proceed from a stop to a frisk, the police officer must reasonably suspect that the person stopped is armed and dangerous." Id.See also United States v. McKoy, 428 F.3d 38, 39 (1st Cir.2005) ("It is insufficient that the stop itself is valid; there must be a separate analysis of whether the standard for pat-frisks has been met."). Reasonable suspicion requires less information than probable cause, but an officer still must rely on specific, articulable facts instead of a mere hunch. United States v. Booker, 579 F.3d 835, 838 (7th Cir.2009). "Whether an officer has a reasonable suspicion... is a fact-specific inquiry that looks at the totality of the circumstances in light of common sense and practicality." United States v. Tinnie, 629 F.3d 749, 751 (7th Cir.2011) (quotation marks omitted).
During the evidentiary hearing on Richmond's motion to suppress, Judge Mihm stated, "I do believe that the officer told the truth under oath." Richmond wisely doesn't challenge this credibility finding, see United States v. Fiasche, 520 F.3d 694, 697 (7th Cir.2008) (special deference is given to district courts' credibility determinations in the motion to suppress context), and he accepts the court's findings of fact. Richmond argues, however, that these facts show that Officer Linthicum had only a hunch that he was carrying a firearm. We have little trouble finding that these uncontested facts support the conclusion that Officer Linthicum had "some articulable suspicion that the subject [was] concealing a weapon or pose[d] a danger to [him] or others," United States v. Oglesby, 597 F.3d 891, 894 (7th Cir.2010) (quoting United States v. Pedroza, 269 F.3d 821, 827 (7th Cir.2001)).
Officer Linthicum observed a conspicuous bulge above Richmond's waistband that was consistent with a revolver handle; both the shape and location of the bulge contributed to Officer Linthicum's concern that Richmond was armed. The disappearance of that bulge when the newspaper boxes obstructed Officer Linthicum's line of sight further suggested that he or a bystander could be endangered by a weapon that had been better hidden or even made ready. The "no record on file" report generated by the pseudonym indicated that Richmond might have been trying to hide information. See United States v. Sholola, 124 F.3d 803, 812-14 (7th Cir. 1997) (a "no record on file" report, while not conclusively incriminating, could contribute to an officer's reasonable suspicions). In such a circumstance, an officer might naturally be apprehensive of the potential for dangerous reaction to confrontationespecially if he already suspects the individual might be armed.
That any of these circumstances may have been independently susceptible to innocent explanation does not negate their collective contribution to Officer Linthicum's reasonable suspicion under the totality of the circumstances. See Fiasche, 520 F.3d at 697. Richmond also suggests that, because he was beckoned to the squad car's window, the officer could not have reasonably suspected him to be dangerous. *263 We reject that argument. An officer may reasonably suspect that an individual would be dangerous to him or the public, especially if confronted by a more aggressive investigative stop, without expecting that the individual would react to the officer's initial low-key questioning by publicly murdering or maiming him in his squad car.
Richmond does not challenge the legality of Officer Linthicum's investigatory stop itself, but rather alleges that the pat-down was an unreasonable search. We conclude that, under the totality of the circumstances, Officer Linthicum had the requisite reasonable suspicion to conduct his minimally invasive pat-down of Richmond's clothing around his waist and hips. See Oglesby, 597 F.3d at 895. Accordingly, the district court did not err by denying Richmond's motion to suppress.
III. CONCLUSION
Because the district court did not err in its determination that Officer Linthicum's pat-down was constitutional, we AFFIRM its denial of Richmond's motion to suppress.
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165 Cal.App.3d 722 (1985)
211 Cal. Rptr. 560
DEBRA HINCHLIFFE, Plaintiff and Appellant,
v.
CITY OF SAN DIEGO et al., Defendants and Respondents.
Docket No. 31076.
Court of Appeals of California, Fourth District, Division One.
February 25, 1985.
*723 COUNSEL
Thistle & Krinsky and Christopher L. Ashcraft for Plaintiff and Appellant.
John W. Witt, City Attorney, Ronald L. Johnson, Senior Chief Deputy City Attorney, Eugene P. Gordon, Chief Deputy City Attorney, and Leslie J. Girard, Deputy City Attorney, for Defendants and Respondents.
*724 OPINION
WORK, J.
Debra Hinchliffe was hired as a probationary police officer. While still on probation, she was discharged without a hearing before the civil service commission (Commission). Claiming section 129 of the San Diego City Charter (Charter) on the date of her hiring granted such a hearing, she sought a writ of mandate. We hold Hinchliffe's hearing rights created by the Charter were not vested so as to be immune from modification by the electorate. Thus, the Charter amendment eliminating Commission review for probationary employees did not impinge any constitutionally protected right of previously hired probationary personnel. We affirm the denial of Hinchliffe's petition for writ of mandate.
FACTUAL AND PROCEDURAL BACKGROUND
On July 23, 1979, Hinchliffe was hired as a police officer I, a classified service position (Charter § 117) subject to a two-year probationary period. At that time, Charter section 129 provided: "Any officer or employee of this City in the classified service may be removed from the office or employment for cause by the appointing authority. Written notice of removal given to any officer or employee, ... shall be sufficient to put any removal into effect. The person so notified may, within five days after such notice, demand a written statement of the reasons therefor and the right to be heard before the Civil Service Commission...." (Italics added.) The Commission, however, denied a discharge hearing to probationary employees. In 1980 the Superior Court of San Diego County resolved the conflict between Charter section 129 and Commission practice in Carman v. City of San Diego (Super. Ct. San Diego Co. No. 453263). There, the court ruled a probationary classified employee was entitled to a hearing before the Commission.
Spurred largely by the Carman litigation, on June 3, 1980, the voters amended Charter section 129 to provide: "Upon attaining permanent status pursuant to the Rules of the Civil Service Commission, any officer or employee of the City in the classified service may be removed from office or employment for cause by the appointing authority...." (Italics added.) Approximately five months after the Charter amendment, Hinchliffe was discharged. She appealed to the Commission and the chief of police; the former denied hearing. As provided in a memorandum of understanding between the City of San Diego and the San Diego Police Officers Association, Hinchliffe presented her case to the police chief's designee who, after a review of the circumstances, affirmed her dismissal.
On April 20, 1982, Hinchliffe petitioned for mandate under the Code of Civil Procedure section 1085, alleging a vested right to the section 129 *725 protections available at the commencement of her employment, before the 1980 amendment. The trial court denied Hinchliffe's petition.
HINCHLIFFE HAS NO VESTED RIGHT TO A DISMISSAL HEARING
(1a) Under certain circumstances, a public employee, even while on probation, may acquire legally enforceable employment rights to which due process guarantees adhere. (See, e.g., Keenan v. S.F. Unified School Dist. (1950) 34 Cal.2d 708 [214 P.2d 382]; see also Arnett v. Kennedy (1974) 416 U.S. 134 [40 L.Ed.2d 15, 94 S.Ct. 1633]; Skelly v. State Personnel Bd. (1975) 15 Cal.3d 194 [124 Cal. Rptr. 14, 539 P.2d 774].) Hinchliffe argues Charter section 129, as written at the time of her hiring, vests a property right to a dismissal-for-cause hearing before the Commission which cannot be removed by later revisions to the Charter.
(2) Public employment, by and large, is not held by contract, but by statute. (Miller v. State of California (1977) 18 Cal.3d 808, 813-814 [135 Cal. Rptr. 386, 557 P.2d 970]; Butterworth v. Boyd (1938) 12 Cal.2d 140, 150 [82 P.2d 434, 126 A.L.R. 838]; Humbert v. Castro Valley County (1963) 214 Cal. App.2d 1, 13 [29 Cal. Rptr. 158]; Risley v. Bd. of Civil Service Commrs. (1943) 60 Cal. App.2d 32, 37-38 [140 P.2d 167].) The public employee, thus, can have no vested contractual right in the terms of his or her employment, such terms being subject to change by the proper statutory authority. (Ibid.) (3) Similarly, employees of charter governments work subject to the amendment, revision or repeal of charter provisions affecting their employment. (See Cal. Const., art. XI, §§ 3, 5; Risley v. Bd. of Civil Service Commrs., supra, 60 Cal. App.2d at p. 37; Cornell v. Harris (1936) 15 Cal. App.2d 144, 146-147 [59 P.2d 570].) For example, in Risley, city employees argued the pending merger of the city department of water and power with two private utility companies would result in the loss of vested promotion and seniority rights. Addressing this argument, the Court of Appeal stated: "Plaintiffs' first two contentions may be considered together, as they involve the same fallacious concept, which is, that plaintiffs have a vested, contractual, right to have the terms of their employment continue unaffected by charter amendments. That they have rights, by virtue of the provisions of the charter, which the courts will protect against unauthorized infringement by the city or any of its legislative or executive officers or boards, is undoubtedly true, and is recognized in the large number of cases cited by the plaintiffs. But that these rights are vested, contractual, rights protected by the state and federal constitutional provisions forbidding the impairment of contracts and the taking of `property' without due process, so that they cannot be changed, is not true.... The rights to which plaintiffs would cling are created by or under the provisions of the charter and are dependent upon those provisions. They may all be lost by *726 repeal of the provisions or modified by an amendment of the provisions, at the will of those who determine what the charter's terms shall be." (Risley v. Bd. of Civil Service Commrs., supra, 60 Cal. App.2d 32, 37, italics added.)
The Supreme Court has more recently recognized this principle in Miller v. State of California, supra, 18 Cal.3d 808. When the plaintiff in Miller was first hired by the State Controller, the mandatory retirement age was 70. After the plaintiff had worked 31 years, Government Code section 20981 was amended to set the mandatory retirement age at 67. Plaintiff claimed a vested contractual right to mandatory retirement at the age in effect when he was first employed. The court found no such right, stating: "[N]o employee has a vested contractual right to continue in the employment beyond the time or contrary to the terms and conditions fixed by law. [Citations.]" (Id., at p. 813.) We have similarly applied the rule of Miller to a tenured state university professor retired against his will under Government Code section 20981. (Schmier v. Board of Trustees (1977) 74 Cal. App.3d 314 [141 Cal. Rptr. 472].)
(4) However, public employment may give rise to certain obligations which are constitutionally protected. (Kern v. City of Long Beach (1947) 29 Cal.2d 848, 852-853 [179 P.2d 799].) For example, promised compensation creates a contractual right which, once vested, "cannot be eliminated without unconstitutionally impairing the contract obligation." (Olson v. Cory (1980) 27 Cal.3d 532, 538 [178 Cal. Rptr. 568, 636 P.2d 532]; Sonoma County Organization of Public Employees v. County of Sonoma (1979) 23 Cal.3d 296, 314 [152 Cal. Rptr. 903, 591 P.2d 1].) (1b) Hinchliffe does not make a compensation claim, but instead seeks to prove a vested right to the terms of her employment as stated at the date of her hiring. Her argument fails, however, to transcend the rule and reasoning of Risley and Miller. Moreover, the extensive case authority on which she relies also fails to advance her argument. Some cases involve the undisputedly vested rights of permanent, not probationary, employees (Arnett v. Kennedy, supra, 416 U.S. 134; Skelly v. State Personnel Bd., supra, 15 Cal.3d 194; Hadley v. City of Ontario (1974) 43 Cal. App.3d 121 [117 Cal. Rptr. 513]; Salyer v. County of Los Angeles (1974) 42 Cal. App.3d 866 [116 Cal. Rptr. 27]), while others examine employee rights vesting from extant laws, regulations or policies (Keenan v. S.F. Unified School Dist., supra, 34 Cal.2d 708; Kerrigan v. Fair Employment Practice Com. (1979) 91 Cal. App.3d 43 [154 Cal. Rptr. 29]; Jean v. Civil Service Commission (1977) 71 Cal. App.3d 101 [154 Cal. Rptr. 29]; Healdsburg Police Officers Assn. v. City of Healdsburg (1976) 57 Cal. App.3d 444 [129 Cal. Rptr. 216]; Perea v. Fales (1974) 39 Cal. App.3d 939 [114 Cal. Rptr. 808]). No cited *727 case recognizes a vested right to employment terms after a proper revision of those terms.
Hinchliffe lastly argues the voters did not intend the amended Charter provision to apply to persons already on the City of San Diego payroll. Further, Hinchliffe claims the amendment cannot divest her of due process rights she previously held. However, Hinchliffe's right to a Commission hearing was not created by the concept of due process, but by the legislative act of the voters in adopting a charter provision. The right thus created is "vested" only in the sense it is protectable by the court so long as it exists, but if not so vested it is subject to elimination by the electorate which created it. (See Risley v. Bd. of Civil Service Commrs., supra, 60 Cal. App.2d 32, 39.) There is no constitutional prohibition to applying this current Charter provision to probationary employees hired before its adoption. Absent a contractual, constitutionally protected right to Commission review, Hinchliffe's argument that the voters did not expressly state the amendment was to apply to existing employees fails.
(5) We find no reason to except this case from the general rule "[t]he right of a probationary employee to a hearing is not a constitutional right, but [one that] may be granted or denied by statute. [Citation.]" (Jean v. Civil Service Commission, supra, 71 Cal. App.3d 101, 109; accord Swift v. County of Placer (1984) 153 Cal. App.3d 209, 215-216 [200 Cal. Rptr. 181]; Lubey v. City and County of San Francisco (1979) 98 Cal. App.3d 340, 345 [159 Cal. Rptr. 440].) (1c) We conclude Hinchliffe was not entitled to a hearing on discharge, this right being eliminated by amendment of Charter section 129. We affirm the denial of the writ of mandate by the trial court.[1]
Order affirmed.
Wiener, Acting P.J., and Butler, J., concurred.
NOTES
[1] In deciding this case we do not reach the question of whether Hinchliffe waived a right to a more extensive hearing under the Charter by appealing to and appearing before the police chief's designee.
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470 S.E.2d 311 (1996)
220 Ga. App. 732
KINES et al.
v.
CITY OF ROME et al.
No. A95A2072.
Court of Appeals of Georgia.
March 15, 1996.
Certiorari Denied May 23, 1996.
Mundy & Gammage, Miles L. Gammage, Cedartown, for appellants.
Brinson, Askew, Berry, Seigler, Richardson & Davis, Robert L. Berry, Jr., Hendrick L. Cromartie III, Rome, for appellees.
Hamilton, Westby, Marshall & Antonowich, Andrew J. Hamilton, Robert C. Buck, Atlanta, amici curiae.
BLACKBURN, Judge.
The claimants appeal the reversal of the administrative law judge's (ALJ) award as affirmed by the appellate division of the Workers' Compensation Board, based on the trial court's conclusion that there was no competent evidence to support the award.
The issue we are confronted with is whether there was "any" competent and credible *312 evidence to support the finding by the ALJ that deceased's heart attack was attributable to his employment, and was thus covered by workers' compensation. See Howard Sheppard, Inc. v. McGowan, 137 Ga.App. 408, 411, 224 S.E.2d 65 (1976).
Kenneth Kines, age 44, a 22-year veteran of the City of Rome Police Department, died after suffering a heart attack while at home, at least 36 hours after his last work shift. As a result, there is no natural inference that the heart attack was work-related. Southwire Co. v. Cato, 250 Ga. 895, 898, 302 S.E.2d 91 (1983).
Claimants contended that the heart attack resulted from on-the-job stress and offered expert medical testimony to support their claim. In order to establish a causal relationship between the employment and the injury, the claimants produced the depositions of two expert witnesses who had never treated, nor were personally familiar with, the deceased.
In their depositions, the expert witnesses testified that, based on the hypothetical facts submitted to them, they believed that job stress was probably a significant factor in bringing on the deceased's heart attack.
One expert was told to assume that there was no family history of heart disease, and the other was told to assume that there was only a mild to moderate family history of heart disease. Uncontroverted testimony, however, established that while there might be little family history of heart disease in the deceased's father's family, the deceased's mother's family had a long history of heart disease. In fact, the deceased's mother was one of ten children, of which seven died from heart or cardiovascular problems.
This fact was not included in the hypothetical and would likely have resulted in a different response from the experts, whose actual responses are rendered meaningless by the omission.
In finding that the heart attack was workrelated, the ALJ stated that his finding was based largely on these depositions. The trial court reversed the award of the ALJ, as affirmed by the appellate division of the Workers' Compensation Board, ruling that certain hypothetical questions posed to the physicians misstated the facts concerning the deceased's family history with regard to cardiovascular problems and, therefore, the responses to such questions must be disregarded.
"Testimony of an expert witness should not be admitted in evidence where his opinion is based on facts stated in a hypothetical question which are not proven by other witnesses or other competent evidence." Ga. Power Co. v. Crutchfield, 125 Ga.App. 488, 489, 188 S.E.2d 140 (1972). The sufficiency of the facts supporting an expert's opinion usually goes to the weight, rather then admissibility, of the expert's testimony. See Krause v. Vance, 207 Ga.App. 615, 616, 428 S.E.2d 595 (1993). Here however, the facts not supplied to the expert witnesses resulted in questions that were not just insufficient, they were misleading. As a result, the testimony provided in the expert depositions was not competent and credible evidence.
Claimants contend that the circumstantial evidence they offered as to the good health of the deceased, and of his father and siblings, somehow conflicts with the circumstantial evidence that his mother, and her family, had a long history of heart and cardiovascular problems and that the trier of fact resolved this conflict. There was no conflict here to be resolved. The mother's family history is undisputed, and its absence in the hypothetical question cannot be ignored. The superior court correctly concluded that the ALJ could not base his award upon responses to flawed hypothetical questions. This type of misleading hypothetical question and resultant response is subject to appellate review, as the ALJ's award on this evidence was clearly erroneous and review is for the correction of errors.
There was testimony that the deceased, as a police officer, had a stressful job involving physical exertion and was demoted several years earlier. There was also evidence that the deceased had been involved in a meretricious relationship for four years and that his wife was pregnant at the time of his death, facts that would reasonably generate *313 far more stress than would a job he had performed without physical problems for 22 years. The evidence of the deceased's dissatisfaction with his employment does not establish a causal connection between his employment and his heart attack.
Accordingly, we affirm the reversal of the ALJ's award by the superior court.
Judgment affirmed.
BEASLEY, C.J., BIRDSONG and POPE, P.JJ., and ANDREWS, JOHNSON, SMITH and RUFFIN, JJ., concur.
McMURRAY, P.J., dissents.
McMURRAY, Presiding Judge, dissenting.
I, respectfully, dissent from the judgment affirming the superior court's reversal of the appellate division's award of death benefits to the widowed claimant and her dependents in this workers' compensation case. In my view, there was competent evidence to support the hypothetical questions posed to claimants' medical experts. Consequently, the award of death benefits is itself supported by some evidence, and the superior court erred in failing to affirm under the "any evidence" standard of review.
Kenneth Kines, a 22-year veteran of the City of Rome Police Department, died after suffering a heart attack at home at the age of 44. Claimants maintain that the heart attack resulted from on-the-job stress. Claimants' contention was embraced by the administrative law judge, who awarded the payment of death benefits. The appellate division adopted the award of the administrative law judge. But the superior court reversed the award of the appellate division based on its conclusion that there was no competent evidence which authorized that award. The superior court ruled that certain hypothetical questions posed to the physicians misstated the facts concerning Kenneth Kines' family history with regard to cardiovascular problems. This discretionary appeal is taken from the superior court's reversal of the appellate division.
"Georgia law recognizes three forms of competent evidence for establishing a causal connection between work activities and cardiovascular problems such as heart attack and stroke: (1) medical opinion, (2) lay observation and opinion and (3) the `natural inference through human experience.' Hiers and Potter, Ga. Workers' CompensationLaw and Practice, § 6-2 citing Guye [v. Home Indem. Co., 241 Ga. 213, 215 (244 SE2d 864) ], and Carter v. Kansas City Fire [etc.] Ins. Co., 138 Ga.App. 601 (226 SE2d 755) (1976)." Reynolds Constr. Co. v. Reynolds, 218 Ga.App. 23, 24, 459 S.E.2d 612 (1995). Claimants primarily utilized the first of these forms, presenting the depositions of two physicians. Neither of the doctors had examined Kenneth Kines but offered their opinions, in response to hypothetical questions, that on-the-job stress could have contributed to the fatal heart attack. "As to hypothetical questions, the answer is not proof that the conclusion reached by the witness applies to or establishes any fact in the case on trial unless it also appears that there is evidence of the salient facts assumed in the hypothetical question. Central R. & Bkg. Co. v. Maltsby, 90 Ga. 630(5) (16 SE 953 [(1892) ])." Norman v. Allen, 118 Ga.App. 394, 396(2), 397, 163 S.E.2d 859 (1968).
The physicians testified that family history is one of the major factors in determining risk for heart attacks. One physician was asked to assume that there was no family history of heart disease while the other was asked to assume a mild to moderate history, a classification which had earlier been elicited from that physician via a recital of claimants' evidence on this issue. The claimants presented evidence as to the good health of Kenneth Kines, prior to the heart attack, and of his father and brothers. The claimants' evidence was not entirely positive since Kenneth Kines' mother had died of a stroke in her 50's. As used to establish an inference concerning the family's overall medical history, this was circumstantial evidence that Kenneth Kines did not have congenital heart problems. In opposition, the employer presented the testimony of a first cousin of Kenneth Kines, who related a significant family history of heart trouble, including genetic heart problems. The mother of Kenneth Kines was one of twelve children, ten of whom survived their infancy. From the ten, four of five males have died with heart trouble, *314 while three of the five females have died from various cardiovascular diseases. Consequently, the circumstantial evidence presented by claimants is contrasted with the circumstantial evidence that defendant had congenital heart problems because four out of five males on his mother's side had congenital heart problems.
"`(R)eliance may be had upon circumstantial evidence for the proof of an essential fact in the framing of a hypothetical question ...' Wells v. Alderman, 117 Ga.App. 724, 735(11) (162 SE2d 18) (1968)." Hyles v. Cockrill, 169 Ga.App. 132, 136(8), 312 S.E.2d 124 (1983). "Generally, `(w)here reliance is made upon circumstantial evidence alone for proof of one of the essential facts assumed in the framing of a hypothetical question, the trier of fact may consider the answer to the question only if it has first determined that the assumed fact has been satisfactorily established.' Travelers Ins. Co. v. Hutchens, 106 Ga.App. 631, 127 S.E.2d 712 (1962). The trier of fact, and not the court, decides whether the assumed fact is actually proved by the circumstantial evidence. Shannon v. Kaylor, 133 Ga.App. 514 (211 SE2d 368) (1974). Nevertheless, it is for the court to decide whether a conclusion assumed is at least supported by the circumstantial evidence before allowing the matter to go to the jury [or factfinder] for its determination as to whether the evidence actually established the fact. Southeastern Fidelity Ins. Co. v. Stevens, 142 Ga.App. 562 (236 SE2d 550) (1977)." Warmack v. Mini-Skools Ltd., 164 Ga.App. 737(1), 738, 297 S.E.2d 365.
In my view of the case sub judice, the opposing inferences authorized by the circumstantial evidence of the absence or presence of Kenneth Kines' genetic heart problems do not vitiate the sufficiency of claimants' evidence to support the non-existence of such congenital problems. "Although the circumstances proved might also support other conclusions, they were sufficient for the purpose of posing the hypothetical question[s] to the expert witness." Krause v. Vance, 207 Ga.App. 615, 616(1), 428 S.E.2d 595 (1993). In my opinion, the superior court erred in concluding that the physicians' answers to the factually supported questions lacked foundation and any probative value. Since there is circumstantial evidence that Kenneth Kines did not necessarily have cardiovascular disease from his mother's side of the family, the hypothetical questions put to the physicians by claimants are supported by evidence insofar as they assume a moderate level or absence of heart disease. I would reverse the judgment of the superior court with directions to reinstate the appellate division's award of death benefits. As my colleagues in the majority would nevertheless affirm the judgment of the superior court in setting aside an award supported by competent evidence, I respectfully dissent.
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[Cite as State v. Rodgers, 2020-Ohio-4173.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
HANCOCK COUNTY
STATE OF OHIO,
CASE NO. 5-20-04
PLAINTIFF-APPELLEE,
v.
WILLIAM E. RODGERS, OPINION
DEFENDANT-APPELLANT.
Appeal from Hancock County Common Pleas Court
Trial Court No. 2019 CR 71
Judgment Affirmed
Date of Decision: August 24, 2020
APPEARANCES:
Brian A. Smith for Appellant
Steven M. Powell for Appellee
Case No. 5-20-04
WILLAMOWSKI, J.
{¶1} Defendant-appellant William E. Rodgers (“Rodgers”) appeals the
judgment of the Hancock County Court of Common Pleas, alleging that his sentence
is not supported by the record. For the reasons set forth below, the judgment of the
trial court is affirmed.
Facts and Procedural History
{¶2} On September 6, 2018, Rodgers sold 0.39 grams of cocaine to a
confidential informant who was working with the Hancock County METRICH
Drug Task Force. PSI. On February 12, 2019, Rodgers was indicted on two counts
of trafficking in cocaine in violation of R.C. 2925.03(A). Doc. 1. On September
27, 2019, Rodgers pled guilty to one count of trafficking in cocaine, which was a
felony of the fifth degree. Doc. 29, 31. The second count of trafficking in cocaine
against Rodgers was dismissed. Doc. 32. At the change of plea hearing, the trial
court ordered that a presentence investigation (“PSI”) be prepared. Change of Plea
Tr. 30.
{¶3} On December 19, 2019, Rodgers appeared before the trial court for
sentencing. Tr. 1. At this hearing, the trial court considered the PSI. Tr. 3, 11-12,
17-19. The trial court then ordered Rodgers to serve an eleven-month prison
sentence. Tr. 21. The maximum prison sentence for this offense was twelve
-2-
Case No. 5-20-04
months. R.C. 2929.14(A)(5). On December 30, 2019, the trial court issued the
judgment entry of sentencing. Doc. 33.
Assignment of Error
{¶4} The appellant filed his notice of appeal on January 28, 2020. Doc. 41.
On appeal, Rodgers raises the following assignment of error:
Because the record, as shown by clear and convincing evidence,
does not support the trial court’s findings, pursuant to R.C.
2953.08(G)(2), the trial court’s sentence of Appellant was not
supported by the record.
Rodgers argues that the trial court did not properly weigh the principles and
purposes of felony sentencing in R.C. 2929.11 or the seriousness and recidivism
factors in R.C. 2929.12.
Legal Standard
{¶5} In rendering a sentence, “[t]he trial court has full discretion to impose
any sentence within the authorized statutory range * * *.” State v. Dayton, 3d Dist.
Union No. 14-16-05, 2016-Ohio-7178, ¶ 15, quoting, State v. King, 2d Dist. Clark
Nos. 2012-CA-25, 2012-CA-26, 2013-Ohio-2021, ¶ 45. However, in this process,
trial courts are to sentence convicted felons in accordance with the overriding
purposes of felony sentencing, which
are to protect the public from future crime by the offender and
others and to punish the offender using the minimum sanctions
that the court determines accomplish those purposes without
imposing an unnecessary burden on state or local government
resources. * * *
-3-
Case No. 5-20-04
R.C. 2929.11. “To effectuate compliance with these overriding purposes, the Ohio
Revised Code requires the trial court to consider a number of factors listed in R.C.
2929.12.” State v. Walton, 3d Dist. Logan No. 8-17-55, 2018-Ohio-1680, ¶ 6. The
R.C. 2929.12 factors direct the trial court to evaluate the seriousness of the offense
and the likelihood of recidivism. R.C. 2929.12.
{¶6} “Appellate courts defer to the broad discretion of the trial court in
matters of sentencing.” State v. Jones, 3d Dist. Shelby No. 17-19-08, 2019-Ohio-
4938, ¶ 7.1 If the defendant establishes by clear and convincing evidence that his or
her sentence is “(1) contrary to law and/or (2) unsupported by the record,” an
appellate court has the authority, pursuant to R.C. 2953.08(G)(2), “to increase,
reduce, or otherwise modify a sentence * * *.” State v. McGowan, 147 Ohio St.3d
166, 2016-Ohio-2971, 62 N.E.3d 178, ¶ 1.
Clear and convincing evidence is that measure or degree of proof
which is more than a mere ‘preponderance of the evidence,’ but
not to the extent of such certainty as is required ‘beyond a
reasonable doubt’ in criminal cases, and which will produce in the
mind of the trier of facts a firm belief or conviction as to the facts
sought to be established.
State v. Sullivan, 2017-Ohio-8937, 102 N.E.3d 86 (3d Dist.), ¶ 12, quoting Cross v.
Ledford, 161 Ohio St. 469, 120 N.E.2d 118, paragraph three of the syllabus (1954).
1
Trial courts are given discretion in applying the statutory factors in the process of determining an appropriate
sentence. A misapplication of these factors in sentencing that rises to the level of an abuse of discretion is
clearly and convincingly contrary to law. Thus, we examine the record to determine whether the trial court
clearly and convincingly failed to act in accordance with the laws governing the imposition of sentences.
-4-
Case No. 5-20-04
Legal Analysis
{¶7} In this case, the trial court ordered Rodgers to serve a prison sentence
of eleven months after considering the contents of the PSI. Tr. 11-12. We begin
our analysis by noting that this prison term falls within the statutory range for a fifth-
degree felony. R.C. 2929.14. As to the seriousness factors, the trial court
considered the factors that are expressly listed in R.C. 2929.12(B)-(C). Tr. 14. The
trial judge then concluded that, “[b]ased on a consideration of the factors in the
statu[t]e, I don’t know that I really find anything either way that makes [this offense]
better or worse than the others * * *.” Tr. 14. However, R.C. 2929.12(B) does not
limit a trial court’s consideration of the seriousness of an offense to the factors
expressly listed in the statute. R.C. 2929.12(B).
{¶8} Rather, R.C. 2929.12(B) directs a trial court to consider “any other
relevant factors” that “indicat[e] that the offender’s conduct is more serious than
conduct normally constituting the offense.” R.C. 2929.12(B). In this case, the trial
court did consider a factor that was not listed in the statute as evidence that the
offense Rodgers committed was “more serious than [the] conduct normally
constituting the offense.” R.C. 2929.12(B). The trial court found the fact that
Rodgers sold but did not use cocaine to be significant. Tr. 17. The trial judge stated
the following:
The other part that is of concern regarding substance use history
is that the offense for which you entered a plea of guilty was
-5-
Case No. 5-20-04
trafficking in cocaine. You indicate that you’ve never been a user
of cocaine, you were only selling it.
Okay. I think that makes it worse because I understand that it’s
not uncommon for users to sell. They sell to other users, they fund
their own habits that way. You’re selling to make money, which
makes you a drug dealer. That’s a problem.
Tr. 17. The PSI also concluded that none of the R.C. 2929.12(C) factors that
indicate the offender’s conduct was less serious were applicable in this case. PSI.
{¶9} As to the recidivism factors, the trial court noted that the PSI indicated
that Rodgers had “an extensive juvenile record” and “an extensive adult record.”
Tr. 14. While Rodgers did not previously have any felony convictions, the trial
court noted that he had previously had several felony charges that resulted in
convictions for misdemeanor offenses. Tr. 15. The PSI concluded that the previous
sanctions that Rodgers had received for his criminal behavior had not resulted in his
rehabilitation as he “continues to engage in criminal behavior.” PSI. Based on the
PSI, the trial judge stated that he “d[i]dn’t find any factors outlined in the PSI that
would indicate recidivism is less likely.” Tr. 15.
{¶10} The trial court also noted that Rodgers had failed to comply with the
terms of his bond. Tr. 15. The PSI indicated that there were ten instances in which
Rodgers “failed to call in on the date that [he was] supposed to * * *.” Tr. 16.
Further, the PSI also indicated that Rodgers reported that he had not used marijuana
since 2012. Tr. 16. However, he tested positive for marijuana three weeks before
-6-
Case No. 5-20-04
the scheduled sentencing hearing. Tr. 16. The PSI also indicated that Rodgers did
not have any mental health issues or history of substance abuse. Tr. 19, 20.
{¶11} The trial court found that these facts “complicated” the prospect of
placing Rodgers on community control instead of placing him in prison. Tr. 18.
The trial judge concluded his analysis by stating the following:
I am, however, Mr. Rodgers, going to find, based upon the
information contained within the presentence investigation,
again, lengthy adult and juvenile criminal history, failure to
comply while on bond, again, no diagnosed or reported mental
health or substance abuse history, I’m going to find that you are
not amenable to community control, that the imposition of a
prison sentence is consistent with the principles and purposes of
sentencing.
Tr. 20-21.
{¶12} In the end, it is evident that the trial court considered the purposes and
principles of felony sentencing in R.C. 2929.11. The trial court also considered the
seriousness and recidivism factors pursuant to R.C. 2929.12 before ordering a prison
term that was within the statutory range. Tr. 12-13, 20-21. See R.C. 2929.14(A).
After reviewing the relevant materials, we conclude that Rodgers’s sentence is
supported by the facts in the record. Because he did not carry the burden of
demonstrating, by clear and convincing evidence, that his sentence was not
supported by the record, Rodgers’s sole assignment of error is overruled.
-7-
Case No. 5-20-04
Conclusion
{¶13} Having found no error prejudicial to the appellant in the particulars
assigned and argued, the judgment of the Hancock County Court of Common Pleas
is affirmed.
Judgment Affirmed
PRESTON and ZIMMERMAN, J.J., concur.
/hls
-8-
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928 F.2d 1113
UNITED STATES of America, Plaintiff-Appellee,v.Reginald Bernard HARRIS, a/k/a "Reggie", Defendant-Appellant.
No. 89-8586.
United States Court of Appeals,Eleventh Circuit.
April 18, 1991.
Sonja J. Salo, Atlanta, Ga., for defendant-appellant.
Deborah A. Griffin, Michael T. Solis, Asst. U.S. Attys., Macon, Ga., for plaintiff-appellee.
Appeal from the United States District Court for the Middle District of Georgia.
Before HATCHETT and ANDERSON, Circuit Judges, and GODBOLD, Senior Circuit Judge.
HATCHETT, Circuit Judge:
1
In this case, we affirm the district court's denial of a motion to suppress evidence seized during the roadside search of a vehicle whose driver law enforcement officers suspected of violating traffic laws. 716 F.Supp. 1470 (1989).
FACTS
2
On March 26, 1989, Dooly County, Georgia, Deputy Sheriff Craig Peavy parked his patrol car (facing north) under the Exit 36 bridge on Interstate 75 in Dooly County to perform stationary radar surveillance on southbound traffic. At approximately 10:55 a.m., Peavy noticed a 1989 Dodge Dynasty travelling north on Interstate 75, "run off the edge of the road" into the emergency lane. Peavy followed the car. While following the car, Peavy saw the car again weave over the edge of the emergency lane. Concerned that the driver of the car might be drunk or falling asleep, Peavy stopped the car.
3
Reginald Harris, driver of the Dodge Dynasty, and the appellant in this case, walked to the back of the car and gave Peavy his driver's license. Peavy explained to Harris the reason for stopping him, and asked whether he had been drinking alcohol. Harris said he had not been drinking, and Peavy did not smell any alcohol on his breath. Peavy then asked Harris if he had run off the road because he was tired, or because he had looked back at Peavy. Harris responded that "he was both tired and was also watching [Peavy]." When asked whether he owned the car, Harris answered that he had rented it. The rental agreement listed Harris as the primary driver and a "Fred Williamson" as an additional driver. When asked whether he had come from Florida, Peavy thought that Harris "said something which sounded like yes." Peavy then asked Harris what part of Florida, and Harris said that he "dropped a friend off in Valdosta," Georgia, and had not been to Florida.
4
According to Peavy, Harris was "shaking" and seemed "extremely nervous." Because a red stamp on Harris's driver's license stated "Limited Permit," Peavy told Harris that he was going to run a computer check on the license. Peavy then requested that Harris sit in the Dodge Dynasty (since his knee was hurting) while Peavy ran a check on Harris's license.
5
While in his car, Peavy radioed Georgia State Patrol Trooper Steve Strickland for assistance. Peavy also radioed the Georgia State Patrol in Cordele, Georgia, and requested a check on Harris's license. In the meantime, Peavy wrote a warning ticket, which he intended to give to Harris, for driving on the edge of the emergency lane. Shortly thereafter, the Georgia State Patrol advised Peavy that Harris had a restricted driver's license which Harris could only use legally for work purposes.
6
Peavy gave Harris the warning ticket and informed him that his license was restricted for work purposes only. Since it was Easter Sunday, however, Peavy told Harris that he would show him some consideration. Immediately thereafter, Peavy asked Harris if he could look in the car to make sure everything was "okay." Harris responded, "No sir, I don't want you to look." Peavy then asked Harris why he would not show a little cooperation since Peavy had shown him "consideration on his license." When Harris asked Deputy Peavy why the officer wanted to look in the car, Peavy told him to "make sure there wasn't any illegal drugs, a weapon or any contraband in the car." Harris then said, "Go ahead and look." Trooper Strickland, who was also present when consent was given, confirmed that when asked by Harris why Peavy wished to search the car, Peavy "advised illegal contraband."
7
With Harris standing beside Trooper Strickland, Peavy searched the interior of the car. Peavy then took the keys out of the ignition and opened the trunk. In the trunk, Peavy found four pieces of luggage including a red bag and a black nylon zipper bag. Peavy unzipped the red bag and found ten kilograms of cocaine. Peavy and Strickland then searched Harris and placed him in the back seat of Strickland's patrol car. Subsequently, Peavy opened the black nylon zipper bag and found nine kilograms of cocaine.
PROCEDURAL HISTORY
8
A grand jury charged Harris, along with Fredel Williamson, in a three-count indictment with conspiracy to possess with intent to distribute nineteen kilograms of cocaine, possession with intent to distribute nineteen kilograms of cocaine, and interstate transportation and concealment of nineteen kilograms of cocaine, in violation of 21 U.S.C. Secs. 846 and 841(a)(1), and 18 U.S.C. Secs. 1952 and 2. The district court severed Williamson's case from Harris's case.
9
Harris filed a motion to suppress all physical evidence. After an evidentiary hearing, the district court denied the motion to suppress. On July 19, 1989, following a non-jury trial, the district court convicted Harris on all counts.
CONTENTIONS
10
Harris contends that the district court erred when it denied his motion to suppress. According to Harris, reasonable suspicion did not exist to support the stop and the investigatory detention was not sufficiently limited in scope and duration. Further, Harris contends that the search of the car exceeded the bounds of his consent.
11
In response, the government contends that the district court properly denied Harris's motion to suppress. The government maintains (a) that the stop was reasonable under the circumstances, (b) that the investigative detention was for a short time and based on reasonable suspicion that criminal activity may have been afoot, and (c) that the search did not exceed the bounds of the consent.
ISSUES
We address the following issues:
12
(1) whether the district court erred when it found the stop to be valid;
13
(2) whether the district court properly found Harris's detention to be lawful; and
14
(3) whether the district court erred when it concluded that the search did not exceed the bounds of the consent.
DISCUSSION
I. Standard of Review
15
We review the district court's denial of Harris's motion to suppress evidence as a mixed question of law and fact. United States v. Wilson, 894 F.2d 1245, 1254 (11th Cir.1990). "The district court's findings of fact are viewed under the clearly erroneous standard; its application of the law to those facts is subject to de novo review." Wilson, 894 F.2d at 1254.
II. The Stop
16
A law enforcement officer "may conduct a brief investigative stop of a vehicle, analogous to a Terry -stop, if the seizure is justified by specific articulable facts sufficient to give rise to a reasonable suspicion of criminal conduct." United States v. Strickland, 902 F.2d 937, 940 (11th Cir.1990). An investigatory stop which is solely based upon "inarticulate hunches" or "unparticularized suspicion" is invalid. Terry v. Ohio, 392 U.S. 1, 22, 27, 88 S.Ct. 1868, 1880, 1883, 20 L.Ed.2d 889 (1968). Further, "investigatory stops are invalid as pretextual unless 'a reasonable officer would have made the seizure in the absence of illegitimate motivation.' " Strickland, 902 F.2d at 940 (quoting United States v. Smith, 799 F.2d 704, 708 (11th Cir.1986)) (emphasis in original).
17
In denying Harris's motion to suppress, the district court concluded:
18
After considering the evidence presented here, the court is persuaded that a reasonable officer would have made this stop absent an illegitimate motive. The testimony showed that Harris weaved into the emergency lane on two separate occasions during a one-mile stretch on Interstate 75. Deputy Peavy did not make the stop until Harris weaved the second time. A reasonable officer would have concluded that Harris was either driving under the influence in violation of state law, or falling asleep at the wheel. Since the stop would have been justified under either conclusion, it was not unconstitutional.
19
Relying upon our decision in Smith, Harris argues that the district court erred when it upheld the validity of the stop. In Smith, we found an investigative stop, based upon a "drug courier profile," to be supported by only an "inarticulate hunch" and, therefore, insufficient to justify a seizure under the fourth amendment. Smith, 799 F.2d at 707. Further, we held that Smith's weaving once into the emergency lane, when considered in the context of other objective evidence, provided only a pretextual basis for the stop. Smith, 799 F.2d at 709-11. In reaching this conclusion, however, we carefully noted that we were not holding that an officer could "not consistently with the fourth amendment stop a vehicle under similar circumstances to investigate for drunk driving." Smith, 799 F.2d at 711 n. 10.
20
Smith is distinguishable from this case. In Smith, the law enforcement officer who made the stop (1) began pursuit before he observed any weaving, (2) made no attempt to investigate the possibility of intoxication after he stopped the car, and (3) described the car as being driven with an "abundance of caution ... indicat[ing] that the stop was unrelated to any possible concern with traffic safety." Smith, 799 F.2d at 710-11. Further, Smith only crossed into the emergency lane once. Finally, the district court expressly found that "the weaving of the car was a pretext for the stop." Smith, 799 F.2d at 706 n. 2.
21
No such facts are present in this case. First, Harris weaved across the emergency lane twice, once before Peavy decided to follow the car and again after Peavy began following the car. Second, when Peavy stopped Harris he investigated whether Harris was intoxicated or falling asleep. Third, Peavy testified that he routinely stops cars where the driver is weaving. Finally, the district court found that a reasonable officer would have concluded that Harris was either driving under the influence of alcohol, in violation of state law or falling asleep at the wheel. Because we find (1) that reasonable suspicion supported Peavy's decision to stop Harris, and (2) that a reasonable officer would have stopped Harris in the absence of an invalid purpose, we hold that the district court did not err when it found the stop to be valid.
III. The Detention
22
In United States v. Sokolow, 490 U.S. 1, 109 S.Ct. 1581, 1585, 104 L.Ed.2d 1 (1989), the Supreme Court, following Terry, held that a police officer "can ... briefly detain a person for investigative purposes if the officer has a reasonable suspicion supported by articulable facts that criminal activity 'may be afoot.' " "In assessing whether a detention is too long in duration to be justified as an investigative stop, we consider it appropriate to examine whether the police diligently pursued a means of investigation that was likely to confirm or dispel their suspicions quickly, during which time it was necessary to detain the defendant." United States v. Sharpe, 470 U.S. 675, 686, 105 S.Ct. 1568, 1575, 84 L.Ed.2d 605 (1985). "Sharpe teaches that in distinguishing a true investigative stop from a de facto arrest, we must not adhere to 'rigid time limitations' or 'bright line rules,' but must use 'common sense and ordinary human experience.' " United States v. Hardy, 855 F.2d 753, 759 (11th Cir.1988) (quoting Sharpe, 470 U.S. at 685, 105 S.Ct. at 1575), cert. denied, 489 U.S. 1019, 109 S.Ct. 1137, 103 L.Ed.2d 198 (1989).
23
Harris contends that the district court erroneously upheld the constitutionality of his detention. According to Harris, the investigatory detention was not sufficiently limited in duration because he should have been allowed to leave after Peavy gave him the warning ticket for weaving. The district court found that "the detention was for a very short time" and that "reasonable suspicion" existed that criminal activity may have been afoot.
24
We hold that the district court did not err when it denied Harris's motion to suppress on this basis. Peavy was justified in stopping and detaining Harris to determine whether he was drunk or falling asleep at the wheel. Further, Peavy did not act unreasonably by detaining Harris to ascertain the validity of his driver's license. Where, as here, " 'the initial stop was legal, the [officer] had the duty to investigate suspicious circumstances that then came to his attention.' " Hardy, 855 F.2d at 757 (quoting United States v. Cruz, 581 F.2d 535, 539 (5th Cir.1978) (en banc)). Similarly, we cannot say that Peavy acted unreasonably by momentarily detaining Harris, after giving him the warning ticket, to request his consent to search the car. Harris was: (1) driving a rental car with a restricted license; (2) "shaking" and acting "extremely nervous"; and (3) gave conflicting responses as to where he had been. Under these circumstances, where Peavy acted on reasonable suspicion and only detained Harris for a short period of time (prior to his arrest when Peavy found the cocaine), we hold that Harris's detention did not violate the fourth amendment's prohibition against unreasonable seizures.
IV. The Search of the Car
25
A search conducted pursuant to consent is a recognized exception to the requirements of probable cause and a search warrant. United States v. Baldwin, 644 F.2d 381, 383 (5th Cir.1981). "When an individual gives a general statement of consent without express limitations, the scope of a permissible search is not limitless. Rather it is constrained by the bounds of reasonableness: what a police officer could reasonably interpret the consent to encompass." Strickland, 902 F.2d at 941.
26
Harris contends that the district court erred when it found that Peavy did not exceed the scope of the consent when he entered the trunk and searched the luggage. In reaching its conclusion, the district court found:
27
First, there was no evidence to rebut the officers' testimony that Harris verbally agreed to the search.
28
* * * * * *
29
He made no attempt to limit the search before it began. Moreover, he did not attempt to prohibit Deputy Peavy from searching the trunk or from opening the travel bags.
30
We hold that Peavy reasonably interpreted the scope of Harris's consent. Peavy offered uncontradicted testimony that Harris did not specifically limit the area that he could search. More importantly, Harris was physically present while Peavy searched the car, and had ample opportunity to limit the scope of the search, or request that it be discontinued. No evidence exists to the contrary.
31
In this case it is also significant that Harris knew that Peavy was looking for drugs. Because Harris knew Peavy was looking for drugs, this case is controlled by United States v. Kapperman, 764 F.2d 786 (11th Cir.1985). In this case and in Kapperman, the defendant knew the officer was looking for drugs; therefore, both defendant and the officer would reasonably interpret the consent as constituting consent to search in places where narcotics would reasonably be hidden. In both cases, no evidence indicated that the defendants intended to limit the scope of the search.
32
Following oral argument in this case, the Supreme Court issued its decision in Florida v. Wells, --- U.S. ----, 110 S.Ct. 1632, 109 L.Ed.2d 1 (1990). In that case, a Florida Highway Patrol trooper arrested Wells for driving under the influence of alcohol. After the trooper informed Wells that his car would be impounded, Wells gave the trooper permission to open the trunk. Under the trooper's direction, employees at the impoundment facility opened a locked suitcase, which was in the trunk of the car, and found a considerable amount of marijuana.
33
The Supreme Court, in affirming the Florida Supreme Court, held that this inventory search "was not sufficiently regulated to satisfy the Fourth Amendment" because "the Florida Highway Patrol had no policy whatever with respect to the opening of closed containers encountered during an inventory search." Wells, 110 S.Ct. at 1634. The Court based this conclusion on the following reasoning:
34
an inventory search must not be a ruse for a general rummaging in order to discover incriminating evidence. The policy or practice governing inventory searches should be designed to produce an inventory. The individual police officer must not be allowed so much latitude that inventory searches are turned into 'a purposeful and general means of discovering evidence of crime.'
35
Wells, 110 S.Ct. at 1633-34 (quoting Colorado v. Bertine, 479 U.S. 367, 376, 107 S.Ct. 738, 743, 93 L.Ed.2d 739 (1987) (Blackmun, J., concurring)).
36
Wells has no application to this case. First, Harris's car was not impounded at the time of the search, and Peavy did not search the car for the purpose of producing an inventory (to either protect himself or Harris's possessions). Second, Harris, as previously noted, was present when Peavy opened the trunk and searched his luggage, and could have stopped Peavy at any time, thereby averting the possibility of "general rummaging in order to discover incriminating evidence." Wells, 110 S.Ct. at 1634.
CONCLUSION
37
In sum, we hold that the district court properly denied Harris's motion to suppress. Accordingly, Harris's conviction and sentence are affirmed.
38
AFFIRMED.
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TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN
NO. 03-04-00504-CV
Ray F. Wilson and Faye D. Wilson, Appellants
v.
Clarence Wachsmann and Joyce Wachsmann, Appellees
FROM THE DISTRICT COURT OF LEE COUNTY, 335TH JUDICIAL DISTRICT
NO. 12,439, HONORABLE H. R. TOWSLEE, JUDGE PRESIDING
M E M O R A N D U M O P I N I O N
Appellants Ray F. Wilson and Faye D. Wilson bring this pro se appeal of the district
court's judgment denying them any recovery against appellees Clarence Wachsmann and Joy (1)
Wachsmann on the Wilsons' claims for past-due farm rent, unpaid loans, and damage to land and
awarding damages to the Wachsmanns on their counterclaims. In twenty-four issues, (2) the Wilsons
challenge the district court's rulings on various pretrial and posttrial motions. For the reasons
discussed below, we affirm the district court's judgment.
BACKGROUND
This appeal arises from a dispute over an alleged oral agreement concerning loans and
farm rent. For many years, the Wachsmann and Wilson families had a sharecropping arrangement
whereby the Wachsmanns would lease the Wilsons' farm land in Manheim; provide the seed,
equipment, and labor to grow various crops; and split the proceeds from the crop with the Wilsons.
The two families never memorialized these arrangements in writing but operated under oral
agreements that renewed from year-to-year.
Until their deaths, Ray Wilson's father (Fred Wilson), and Ray Wilson's brother (Ural
Wilson), oversaw the family's sharecropping arrangement with the Wachsmanns. Thereafter, Ray
Wilson and his wife, Faye Wilson, began exclusive oversight of the arrangement. Disputes arose,
and the Wilsons sued the Wachsmanns in justice of the peace court claiming that the Wachsmanns
failed to repay a $5000 loan for farm expenses. The Wilsons went to trial under a second amended
original petition that sought both eviction ("immediate possession of their property") and "$5,000
without pre-judgment interest but with post-judgment interest, as complete and full satisfaction of
said debt owed." The justice court rendered a take-nothing judgment:
This the 25th day of March, 2003, came on to be tried in its regular order the above-styled and numbered cause, wherein RAY F. WILSON, FAYE D. WILSON,
Plaintiff, and CLARENCE WACHSMANN, JOYCE WACHSMANN, Defendant,
and came the parties in person and through their attorney and announced ready for
trial, and neither party having demanded a jury, all matters in controversy, of fact and
law, were submitted to the Court sitting without a jury; and the pleadings, evidence
and argument of counsel having been heard by the Court, it is the opinion of the
Court that the Plaintiff should take nothing by his suit; that the Defendant, go hence
with his cost without delay and that execution issue in Defendant's behalf for his said
costs.
The Wilsons did not perfect an appeal from this judgment. (3)
In a separate action in district court, the Wilsons sued the Wachsmanns for
$21,173--which included the $5000 farm expense loan for which they had sought recovery in justice
court. The Wachsmanns counterclaimed, seeking as an offset the damages they incurred from the
Wilsons' breaching the crop lease agreement by attempting to evict them.
The Wachsmanns sought partial summary judgment on the basis that the Wilsons'
claim regarding the $5000 farm expense loan was barred by res judicata. The district court granted
the motion, ordering:
IT IS ORDERED that upon the trial of this cause the following facts are found to be
established without the need of further proof:
Defendants Wachsmann are not liable to Plaintiffs Wilson for the $5,000.00 debt
alleged by Plaintiffs to be due them from the Defendants.
IT IS FURTHER ORDERED that all other facts material to the claims and defense
of the parties remain for trial.
The Wilsons subsequently filed a motion for rehearing of the partial summary
judgment and a motion for sanctions against the Wachsmanns' counsel; the district court denied
both. The court also granted the Wachsmanns' motion in limine to preclude either party from
mentioning the $5000 farm expense loan. It also granted the Wachsmanns' motion to exclude the
testimony of two of the Wilsons' witnesses whom they had failed to identify in response to the
Wachsmanns' request for disclosure. Finally, the district court denied an instrument that the Wilsons
termed "special exceptions," which purported to challenge the Wachsmanns' answer with evidence
of additional facts.
The claims were tried to a jury, which rejected each of the Wilsons' claims for
damages, found that the Wilsons breached the crop lease agreement, and awarded damages to the
Wachsmanns of $4687. The district court rendered judgment in accordance with the jury verdict,
awarding the Wachsmanns $4687 in damages, plus costs and attorney's fees, see Tex. Civ. Prac. &
Rem. Code Ann. § 38.001(8) (West 1997), and ordering that the Wilsons take nothing on their
claims. After judgment, the Wilsons filed a motion for new trial, a motion for judgment
notwithstanding the verdict, and a motion to supplement their answers to the Wachsmanns'
disclosure requests. The district court denied each of these motions.
On appeal, the Wilsons contend that the district court erred by (1) denying their
special exceptions; (2) granting a motion for partial summary judgment while denying their motion
for rehearing, motion for sanctions, and their bills of exception; (3) excluding two of their trial
witnesses; (4) failing to give a limiting instruction after the Wachsmanns' counsel violated the
motion in limine; (5) denying their motion for new trial and motion for judgment notwithstanding
the verdict; and (6) denying their motion to supplement discovery.
DISCUSSION
Special exceptions
In their first set of issues, the Wilsons complain that the district court erred in denying
their special exceptions. The Wilsons excepted to the portion of the Wachmanns' original answer
that asked the district court to take judicial notice of the justice court's take-nothing judgment. They
also excepted to the Wachsmanns' counterclaim for breach of the lease agreement, which alleged
that the Wilsons' damages should be offset by the expenses that the Wachsmanns incurred as a result
of the Wilsons' eviction proceedings. We note that the Wachsmanns' original answer, which is the
subject of the Wilsons' special exceptions, is omitted from the appellate record.
We review the district court's ruling on special exceptions for an abuse of discretion.
Wayne Duddlesten, Inc. v. Highland Ins. Co., 110 S.W.3d 85, 96 (Tex. App.--Houston [1st Dist.]
2003, pet. denied) (citing Muecke v. Hallstead, 25 S.W.3d 221, 224 (Tex. App.--San Antonio 2000,
no pet.)). An abuse of discretion will be found if the district court fails to correctly analyze or apply
the law. See Walker v. Packer, 827 S.W.2d 833, 840 (Tex. 1992).
In their special exceptions, the Wilsons argued that the court should not take judicial
notice of the justice court's judgment because it conflicted with an oral agreement that the justice
court would only rule on the issue of possession. They also argued that the allegations in the
Wachsmanns' counterclaim for offset were insufficient to give them fair notice. (4)
The Wilsons' special exceptions were improper. Special exceptions must confine
themselves to addressing matters shown on the face of the opposing pleading and must not inject
factual allegations not appearing in the pleading against which the exception was raised. Brown v.
Hawes, 764 S.W.2d 855, 856 (Tex. App.--Austin 1989, no writ); see also Tex. R. Civ. P. 91. When
a special exception "goes outside the record and sets up a matter which requires proof, it is by its
very nature a 'speaking demurrer,' which is not a valid pleading under our rules." Sherman v. Triton
Energy Corp., 124 S.W.3d 272, 282-83 (Tex. App.--Dallas 2003, pet. denied) (quoting Travelers
Indem. Corp. v. Holt Mach. Co., 554 S.W.2d 12, 15 (Tex. Civ. App.--El Paso 1977, no writ)). The
Wilsons' purported special exceptions were not confined to matters on the face of the Wachsmanns'
answer but relied upon extrinsic facts: an alleged agreement between the parties that conflicted with
the justice court's judgment and excerpts of deposition testimony disputing the merits of the
Wachsmanns' counterclaim. (5)
Because the Wilsons' exceptions relied upon facts extrinsic to the Wachsmanns'
original answer, the district court did not abuse its discretion in denying their special exceptions.
We overrule the Wilsons' first issue.
Partial summary judgment
In their second set of issues, the Wilsons contend that the district court erred in
granting a partial summary judgment that the Wilsons' claim regarding the $5000 farm expense loan
was barred by res judicata. The Wilsons also challenge the court's denial of motions they later filed
seeking rehearing of the partial summary judgment and sanctions, (6) each of which sought to revisit
matters addressed in the partial summary judgment.
The district court's ruling on a summary judgment is a question of law that we review
de novo. Valence Operating Co. v. Dorsett, 164 S.W.3d 656, 661 (Tex. 2005). The party moving
for summary judgment bears the burden of showing that no genuine issue of material fact exists and
that it is entitled to judgment as a matter of law. Provident Life & Accident Ins. Co. v. Knott, 128
S.W.3d 211, 215-16 (Tex. 2003). The Wilsons argue that the district court's order "gives rise to an
erroneous judgment on all grounds" because it does not specify the grounds on which the court
relied. In fact, Texas law is squarely the opposite: because the district court's order does not specify
the grounds for its ruling, we must affirm the summary judgment if any of the theories presented to
it and preserved for appellate review are meritorious. Id. at 216.
Under the doctrine of res judicata, the Wilsons are barred from raising in district
court claims that were adjudicated in the justice court's take-nothing judgment. See Brown v.
Henderson, 941 S.W.2d 190, 192 (Tex. App.--Corpus Christi 1996, no writ) (discussing Tex. Civ.
Prac. & Rem. Code Ann. § 31.005 (West 1997)); Wren v. Gusnowski, 919 S.W.2d 847, 849 (Tex.
App.--Austin 1996, no writ); Webb v. Persyn, 866 S.W.2d 106, 107 (Tex. App.--San Antonio 1993,
no writ); McClendon v. State Farm Ins. Co., 796 S.W.2d 229, 232 (Tex. App.--El Paso 1990, writ
denied); see also Harrill v. A.J.'s Wrecker Serv., Inc., 27 S.W.3d 191, 195 (Tex. App.--Dallas 2000,
pet. dism'd w.o.j.) (county court at law sua sponte dismissed additional causes of action that claimed
same damage and were based on same conduct as in prior justice court suit).
Res judicata precludes the relitigation of claims that have been finally adjudicated
in a prior action as well as claims that pertain to the same subject matter and could have been, but
were not, litigated. Amstadt v. United States Brass Corp., 919 S.W.2d 644, 652 (Tex. 1996). The
policies behind res judicata reflect the need to bring all litigation to an end, prevent vexatious
litigation, maintain the stability of court decisions, promote judicial economy, and prevent double
recovery. Barr v. Resolution Trust Corp., 837 S.W.2d 627, 629 (Tex. 1992). Res judicata defeats
a claim when there is proof of (1) a prior final judgment on the merits by a court of competent
jurisdiction; (2) identity of parties or those in privity with them; and (3) a second action based on the
same claims as were raised or could have been raised in the first action. Amstadt, 919 S.W.2d at
652.
Here, the justice court entered a prior, final judgment on the merits of the Wilsons'
claim for repayment of the alleged $5000 farm expense loan. The justice court's judgment, entered
on March 23, 2003, had become final by July 23, 2003, when the Wilsons filed their suit in district
court. See Tex. R. Civ. P. 306a, 329b(a); Tex. R. App. P. 26.1(a). The justice court's take-nothing
judgment, which recites that it considered "all matters in controversy, of fact and law," submitted
by the parties and heard the "pleadings, evidence, and argument of counsel," was a ruling on the
merits. See Qaddura v. Indo-European Foods, Inc., 141 S.W.3d 882, 894 (Tex. App.--Dallas 2004,
pet. denied) (take-nothing judgment is judgment on merits); State v. Herrera, 25 S.W.3d 326, 326
(Tex. App.--Austin 2000, no pet.) (same). The justice court was a court of competent jurisdiction
for the Wilsons' claims for eviction and the $5000 debt. See Tex. Gov't Code Ann. § 27.031(a)
(West 2004).
Additionally, the parties and claims in the justice court and district court suits were
the same. The Wilsons' district court petition claimed $5000 for a loan to the Wachsmanns, just as
their justice court petition for eviction included a claim for $5000 in "complete and full satisfaction"
of the same debt. See Brown v. Henderson, 941 S.W.2d 190, 192 (Tex. App.--Corpus Christi 1996,
no writ) (comparing pleadings submitted in justice court and county court at law to identify any
claims that were not barred by res judicata). The Wilsons did not sever their claim for the $5000
loan from their claim to evict the Wachsmanns from the farm. See Van Dyke v. Boswell, O'Toole,
Davis & Pickering, 697 S.W.2d 381, 384 (Tex. 1985) (res judicata effects of action cannot preclude
litigation of claims that trial court explicitly severs from that action).
Because the Wachsmanns proved the existence of a prior final judgment on the merits
by a court of competent jurisdiction, an identity of parties, and a second action based on the same
claim, they satisfied the elements of the affirmative defense of res judicata as a matter of law. See
Amstadt, 919 S.W.2d at 652. Accordingly, we find that the Wilsons' claim for the $5000 loan to the
Wachsmanns was barred by res judicata.
The Wilsons seek to avoid the implications of res judicata by collaterally attacking
the justice court's judgment. They contend that, while their written justice court pleadings sought
recovery of the $5000 loan, these pleadings were in fact orally amended, superseded, and abandoned.
Noting that pleadings in justice court are often oral, the Wilsons argue that the justice court orally
ruled in open court that it lacked jurisdiction over the loans and that the Wachsmanns' counsel pled
orally that "we should address only possession and leave loans and rent for another court." See Tex.
R. Civ. P. 525.
As an appellate court, we are bound by the record before us, and there is nothing in
the record to support the Wilsons' assertions regarding their justice court pleadings. In any event,
the justice court's written order controls over any alleged oral pronouncement at a hearing. In re
K.M.B., 148 S.W.3d 618, 622 (Tex. App.--Houston [14th Dist.] 2004, no pet.); see also In re J.J.,
900 S.W.2d 353, 356 (Tex. App.--Texarkana 1995, no writ) (written judgment controls over court's
oral pronouncements); Nine Greenway Ltd. v. Heard, Goggan, Blair & Williams, 875 S.W.2d 784,
787 (Tex. App.--Houston [1st Dist.] 1994, no writ) (same).
The Wilsons also argue that the Wachsmanns later judicially admitted the existence
of the $5000 debt in district court. There is no such admission in the record. (7) They also contend that
the Wachsmanns' motion for partial summary judgment was untimely. The sole basis for this
assertion was a deadline included in a proposed docket control order that the Wilsons circulated but
the Wachsmanns never agreed to and the district court did not adopt. Finally, the Wilsons contend
that the district court failed to address contentions raised in pleadings the Wilsons filed after the
Wachsmanns submitted their motion for partial summary judgment but before the district court
granted it. (8) The record does not reflect that any such pleadings were filed and, in any event, the
district court was required to render its order based on the pleadings on file at the time the
Wachsmanns' motion was submitted. Tex. R. Civ. P. 166a(c)(ii).
The district court did not err in granting the Wachsmanns' motion for partial summary
judgment.
Motion for sanctions
Revisiting their arguments against the motion for partial summary judgment, the
Wilsons contend that the district court erred in denying their motion for sanctions (9) against the
Wachsmanns and their counsel for filing groundless pleadings. See Tex. R. Civ. P. 13.
We review a ruling on a motion for sanctions under an abuse of discretion standard.
Cire v. Cummings, 134 S.W.3d 835, 838 (Tex. 2004). The test under this standard "is not whether,
in the opinion of the reviewing court, the facts present an appropriate case for the trial court's action,
but 'whether the court acted without reference to any guiding rules and principles.'" Id. The trial
court's ruling should be reversed only if it was arbitrary or unreasonable. Id. Moreover, rule 13
requires courts to presume that pleadings are filed in good faith. GTE Communications Sys. Corp.
v. Tanner, 856 S.W.2d 725, 731 (Tex. 1993). The burden is on the party moving for sanctions to
overcome this presumption. Id.
The Wilsons argue that the district court pleadings made the basis of the
Wachsmanns' motion for partial summary judgment had "no basis in law or fact." To support this
assertion, the Wilsons advance the same arguments concerning the pleadings and rulings in justice
court as they did in opposition to the Wachsmanns' partial summary judgment motion. We conclude
that the district court did not abuse its discretion in denying the Wilsons' motion for sanctions.
Motion for rehearing
The Wilsons further contend that the district court erred in denying their motion for
rehearing of the Wachsmanns' partial summary judgment. Their motion informed the court that its
ruling was based on pleadings that had been amended and asked the court to hold a second,
expedited hearing so that the Wilsons could present two subpoenaed witnesses, the justice of the
peace and his assistant. The district court did not err in denying the motion for rehearing or abuse
its discretion in refusing to hold a hearing to hear live testimony. Tex. R. Civ. P. 166a(c) ("[n]o oral
testimony shall be received"); see Martin v. Martin, Martin & Richards, Inc., 989 S.W.2d 357, 359
(Tex. 1998).
We have found that the district court did not err in granting partial summary judgment
for the Wachsmanns. We further find that the district court did not abuse its discretion in denying
the Wilsons' motions for rehearing and for sanctions. Accordingly, we overrule the Wilsons' second
set of issues.
Exclusion of trial witnesses
In their third set of issues, the Wilsons assert that the district court erred in excluding
the testimony of two witnesses at trial, the justice of the peace who presided over their first suit and
his assistant. We review a trial court's decision to exclude testimony for an abuse of discretion.
Morrow v. H.E.B., Inc., 714 S.W.2d 297, 298 (Tex. 1986).
The Wilsons' brief states that the court "refused the necessary indispensable
discovery" from these witnesses and that it should not have imposed a "death penalty sanction" on
the Wilsons to deny them a trial on the merits of the case. In fact, the record shows that the district
court excluded the justice of the peace and his assistant because the Wilsons failed to identify them
in response to the Wachmanns' request for disclosure. See Tex. R. Civ. P. 194; 193.6(a). The
district court did not abuse its discretion in excluding the witnesses in accordance with rule 193.6.
We overrule the Wilsons' third set of issues.
Motion to supplement discovery
In their fourth set of issues, the Wilsons assert that the district court erred in denying
the Wilsons' motion to supplement their response to the Wachsmanns' disclosure requests. The
Wilsons' request to supplement their list of testifying witnesses was untimely--they filed it after the
verdict and judgment. See Tex. R. Civ. P. 193.5(b). Thus, we overrule the Wilsons' fourth set of
issues.
Limiting instruction
In their fifth set of issues, the Wilsons argue that the district court erred in failing to
give a limiting instruction when the Wachsmanns' counsel violated the motion in limine by
mentioning the $5000 loan in closing arguments. The Wilsons did not preserve error regarding this
contention by objecting or requesting a limiting instruction at the time. See Tex. R. App. P. 33.1(a)
(party must make timely request, objection, or motion, stating specific grounds for ruling it desired
court to make, and obtain ruling to preserve complaint for appellate review). Although the Wilsons
approached the bench after the Wachsmanns' counsel commented on the loan, the bench conference
was off the record. Because the record shows that the Wilsons failed to preserve error, we overrule
their fifth set of issues.
Remaining issues
In their sixth set of issues, the Wilsons argue that the district court erred in denying
their motion for new trial and motion for judgment notwithstanding the verdict. They also argue that
an exhibit presented at the Wachsmanns' depositions caused irreparable harm to the Wilsons.
Because the Wilsons presented no authority and failed to brief their arguments regarding these
issues, we overrule them. See Tex. R. App. P. 38.1(h).
CONCLUSION
Having overruled all of the Wilsons' issues, we affirm the district court's judgment.
__________________________________________
Bob Pemberton, Justice
Before Chief Justice Law, Justices B. A. Smith and Pemberton
Affirmed
Filed: May 3, 2006
1. Although the Wilsons' notice of appeal and, therefore, our caption refer to appellee as
"Joyce" Wachsmann, she is identified in the record and her brief as "Joy" Wachsmann.
2. We have grouped the Wilsons' arguments into six issues.
3. However, the Wilsons represent in their amended docketing statement that they "have a bill
of review in Lee County J.P. Court for correction" of the justice court's judgment.
4. Although the Wilsons claimed lack of fair notice of the Wachsmanns' counterclaim, their
responses to the district court's questioning clarified that they had fair notice but disputed the merits
of the counterclaim. The court informed them that the merits of the counterclaim would be resolved
at trial.
5. Pro se representation does not excuse the Wilsons from complying with applicable rules
of procedure: "Neither is [the right of self-representation] a license not to comply with the relevant
rules of procedural and substantive law." Faretta v. California, 422 U.S. 806, 834 n.46 (1975).
There cannot be two sets of procedural rules, one for litigants with counsel and the other for litigants
representing themselves. Litigants who represent themselves must comply with the applicable
procedural rules, or else they would be given an unfair advantage over litigants represented by
counsel. Mansfield State Bank v. Cohn, 573 S.W.2d 181, 184-85 (Tex. 1978), see also Gudur v.
Texas Dep't of Health, 2005 Tex. App. LEXIS 8742, at *13 n.5 (Tex. App.--Austin 2005, no pet.).
6. The Wilsons also complain that the district court wrongly denied their bills of exception
concerning two exhibits, a check and a deposit receipt, and the court's ruling excluding testimony
from two of their trial witnesses. To the contrary, the record contains both exhibits and the Wilsons'
exception to the exclusion of the witnesses.
7. The Wilsons urge that the Wachsmanns made judicial admissions in their responses to
requests for admission, their deposition testimony, their counsel's argument at the special exceptions
hearing, and their settlement offer. We note that the Wilsons failed to include in the record the
Wachsmanns' responses to their requests for admission and Clarence Wachsmannn's deposition.
A judicial admission is conclusive upon the party making it, relieves the opposing party
of its burden to prove the admitted fact, and bars the admitting party from disputing it. Mendoza v.
Fidelity & Guar. Ins. Underwriters, Inc., 606 S.W.2d 692, 694 (Tex. 1980). True judicial
admissions are formal waivers of proof usually found in pleadings or in parties' stipulations. Id. Joy
Wachsmann's deposition testimony, counsel's argument at the special exceptions hearing, and the
Wachsmanns' settlement offer to the Wilsons are not pleadings or stipulations and cannot constitute
conclusive judicial admissions. See id. Further, the Wachsmanns' settlement offer may not be
considered a judicial admission, as it was not made during the course of a judicial proceeding. See
id.
8. The Wilsons also claim error regarding an additional motion for partial summary judgment
that the Wachsmanns sought on limitations grounds. The gist of the Wilsons' argument seems to
be that the Wachsmanns titled this motion "motion for partial summary judgment" rather than
"second motion for partial summary judgment" and that this alleged misidentification caused them
"to suffer triple jeopardy." Even if the Wilsons stated a complaint cognizable under Texas law, the
record does not reflect that they suffered harm: there is no indication that the district court granted
the second partial summary judgment motion.
9. The Wilsons filed a motion for sanctions and a supplement to the motion.
| {
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RECORD IMPOUNDED
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-0410-15T3
NEW JERSEY DIVISION
OF CHILD PROTECTION
AND PERMANENCY,
Plaintiff-Respondent,
v.
N.R.,
Defendant-Appellant.
__________________________
IN THE MATTER OF J.S., M.L.,
JR., C.E., and K.E., minors.
________________________________________________________________
Submitted April 4, 2017 – Decided August 18, 2017
Before Judges Espinosa and Suter.
On appeal from Superior Court of New Jersey,
Chancery Division, Family Part, Gloucester
County, Docket No. FN-08-77-15.
Joseph E. Krakora, Public Defender, attorney
for appellant (Norma Davis, Designated
Counsel, on the briefs).
Christopher S. Porrino, Attorney General,
attorney for respondent (Melissa H. Raksa,
Assistant Attorney General, of counsel;
Katrina A. Sansalone, Deputy Attorney General,
on the brief).
PER CURIAM
Defendant N.R. (Nancy)1 appeals from an adjudication of abuse
and neglect, N.J.S.A. 9:6-8.21, as to her four-year-old child,
M.L. (Moe). She argues there was insufficient evidence to support
this conclusion and the trial court erred in relying upon
documentary evidence to support its decision. We disagree and
affirm.
I.
Nancy is the mother of four children. In addition to Moe
(d.o.b. 11/21/90), she has J.S. (Jack) (d.o.b. 1/28/05), and twins,
C.E. and K.E. (Clark and Kim) (d.o.b. 9/2/14). M.L. (Mark) is
Moe's father; Jack's father is deceased and B.E. (Bob) is the
father of Clark and Kim.
On October 7, 2014, the Division of Child Protection and
Permanency (the Division) was alerted to a domestic violence
incident between Nancy and Bob that occurred while the children
were present and resulted in Nancy being charged with simple
assault. Nancy admitted Jack witnessed the incident. However,
1 We use fictitious names to protect the privacy of the parties.
2 A-0410-15T3
both Jack and Moe told the Division caseworker they saw Nancy and
Bob arguing and saw Bob break a window and go through it. Jack
reported seeing Bob choke Nancy. Moe told the caseworker Bob had
hurt Nancy "a lot of times."
The Division instituted a Safety Protection Plan in which Bob
would not return to the home and was not permitted to have contact
with the children. Both Nancy and Bob agreed to the terms of the
plan.
On October 14, 2014, the Division received a referral from a
Franklin Township police officer, reporting that Moe was observed
by a neighbor wandering around outside at approximately 9:15 a.m.,
alone and clad only in his underwear. The neighbor questioned
Moe, who stated no one was at home. Nancy and Bob returned to the
home ten minutes after they were contacted by police.
The Division interviewed Nancy, who stated she ran to the
store while her mother, D.B. (Dina), was in the basement doing
laundry. Moe was sleeping at the time. Nancy stated Dina had
been staying at the home to help with the babies. She had arrived
and spent the night before at the home. She claimed Dina then
left around 10:30 a.m. to go to work. Nancy stated she did not
know how Bob got to the home, and thought he got a ride.
3 A-0410-15T3
When interviewed by the Division caseworker, Bob stated, "I
can't lie to you. [Dina] wasn't here. She is going to tell you
that she was here but she wasn't." He told the caseworker Nancy
had picked him up at the library and had only Clark and Kim in the
car. Bob also admitted to being in the home in violation of the
Safety Protection Plan.
The Division also interviewed Moe and Jack. Moe had not seen
Dina that day. Jack also stated Dina did not spend the night
before at the home, and that he had not seen Dina the morning of
the incident.
Dina told the Division caseworker she was at the home that
morning. She stated Moe was sleeping when she went into the
basement to do laundry. She was in the basement for approximately
fifteen minutes when her boss called to say she had to come to
work. Bob and Nancy returned home, so Dina left at approximately
10:30-10:45 a.m. Dina reported she had a friend pick her up from
Nancy's house but declined to disclose the name of her friend.
Dina stated she had briefly interacted with Moe after Nancy
returned home, and denied seeing the police outside of the home.
The caseworker told Dina her timeline did not make sense, as Moe
was outside at approximately 9:15 a.m., not 10:15 a.m. Dina later
4 A-0410-15T3
called the Division caseworker to say she got the time wrong and
she was in the basement at 9:15 a.m., not 10:15 a.m.
The Division caseworker checked Nancy's call history, which
showed Nancy called Dina at 10:56 a.m., and made six more calls
thereafter to her phone.
After determining Nancy had left Moe home alone, the Division
conducted an emergency removal of the four children pursuant to
N.J.S.A. 9:6-8.29 and 9:6-8.30. The Division also determined Nancy
and Bob had violated the Safety Protection Plan that prohibited
Bob from being in the home.2
A Safety Protection Plan was instituted for Moe, who was taken
to Mark's house. Jack, Clark, and Kim were placed in resource
care with the maternal grandfather and step-grandmother. The
following day, the Division interviewed the neighbor who called
the police about Moe. She reported she had gone outside around
9:15 a.m. and saw Moe outside wearing only a t-shirt and underwear.
Moe told her Nancy was not home, and the neighbor stayed outside
with him for approximately fifteen minutes. Nancy then returned
home with Bob driving the car, and Nancy told Moe that Dina was in
the basement. Nancy took Moe inside and dressed him, and then
2 The trial judge found this allegation did not rise to the level
of a Title 9 finding.
5 A-0410-15T3
they all left. The neighbor stated she stayed outside out of
curiosity and never saw Dina leave or any cars pick her up.
On October 15, 2014, the Division filed a complaint for the
care and supervision of Moe, and for the custody, care, and
supervision of the three other children.
A hearing was held on October 16, 2014, at which Nancy, Mark,
Dina and a Division caseworker testified. The caseworker, Michelle
Leyman, who responded to the home following the referral, recounted
her interviews with Nancy, Dina, Bob, Moe, and the neighbor who
called the police. Moe told her when "he woke up, he looked in
several of the rooms of the house. No[]one was home. He went
outside. He said at no time did he see his . . . maternal
grandmother. And then, his mom came home in the yard."
Nancy testified Moe woke up early and was sick. She put him
back to sleep. Her mother was present when she left to do an
errand, taking the twins with her. When she returned, Moe was in
the yard and her neighbor scolded her, saying, "What are you doing?
Nobody's here. [Moe] was looking for you. He came outside."
Nancy explained that her mother had come late the previous night
and neither Moe nor Jack knew she was there. Nancy said she went
into the house and told her mother Moe was outside. She said Dina
6 A-0410-15T3
had been in the basement doing laundry and was still there when
Nancy returned.
Dina provided testimony that was largely corroborative of
Nancy's version of events. Mark, a non-dispositional defendant,
was present and advised the court he had filed for custody of Moe.
The trial judge acknowledged there was "a lot of conflicting
testimony" but resolved that conflict by finding, "[Moe] was left
unattended." He concluded "the Division has made its case with
regard to removing the children," and issued an order placing Moe
in the care and supervision of the Division and the three other
children under the custody, care, and supervision of the
Division. An order to show cause why the children should not
continue under the custody, care, and supervision of the Division
was entered. That order was continued; a preliminary fact-
finding hearing was held on March 6, 2015, and the fact-finding
hearing was held on April 17, 2015.
At the outset of the fact-finding hearing conducted on April
17, 2015, the Deputy Attorney General advised the court there was
an agreement as to several exhibits: an Investigation Summary dated
October 7, 2014; an Investigation Summary dated October 14,
7 A-0410-15T3
2014; and four Safety Protection Plans, and stated further that
"the Division will rest on the papers." Nancy's attorney consented
to the admission of those exhibits into evidence.
The trial judge reviewed the documentary evidence, noting it
had been admitted without objection. He cited specific statements
in the documentary evidence, including the following.
The neighbor, who observed Moe standing outside in his
underwear on October 14, 2014, asked Moe, "Are you all right,
Honey?" He replied, "Mommy's not here," and "[Bob] took mommy to
work." She stated she asked if he had checked the bedrooms and
bathrooms and stayed with Moe until Nancy and Bob returned
approximately fifteen minutes later. She remained outside to
continue her observation and stated at no time did she see the
maternal grandmother leave the house on October 14, 2014.
Bob admitted that Nancy picked him up that morning on October
14, 2014, and had the twins in the car. He stated Nancy's mother
was not at home. Bob "couldn't believe [Nancy] left [Moe] home
alone," stating, "She's messed up."
Dina stated she was in the basement doing laundry for about
fifteen minutes at the time that Moe wandered outside and left for
work at about 10:30-10:45 a.m. that morning. Although she said
8 A-0410-15T3
she had interacted with Moe that morning, she could not recall
what she said to him.
Nancy denied leaving Moe home alone on October 14, 2014,
maintaining her mother was there.
Jack reported he did not see Dina the prior night or in the
morning before he got on the bus for school at about 7:52 a.m.
Moe stated he did not find anyone in the house when he woke
up and he was scared. He did not see his grandmother the prior
evening or at all that morning. He also said Bob had been in the
home over the weekend.
The trial judge noted inconsistencies in Dina's statements
and found Nancy's account not credible in light of the statements
from Bob, Jack and Moe. He concluded the Division had proven by
a preponderance of the evidence that four-year-old Moe was left
alone unattended, warranting an adjudication of abuse and neglect
under N.J.S.A. 9:6-8.21.
In her appeal, Nancy argues the Division failed to prove
neglect because her conduct was not grossly or wantonly negligent
and did not constitute a failure to exercise a minimum degree of
care, and because the record fails to show that Moe was at a
substantial risk of harm. She further argues the trial judge erred
in relying exclusively upon documentary evidence.
9 A-0410-15T3
II.
To support a finding of abuse and neglect, the Division must
prove by a preponderance of "competent, material and relevant
evidence," N.J.S.A. 9:6-8.46(b), that the parent failed
to exercise a minimum degree of care . . . in
providing the child with proper supervision or
guardianship, by unreasonably inflicting or
allowing to be inflicted harm, or substantial
risk thereof, including the infliction of
excessive corporal punishment; or by any other
acts of a similarly serious nature requiring
the aid of the court.
[N.J.S.A. 9:6-8.21(c)(4)(b).]
A parent fails to exercise a "minimum degree of care" when
the parent engages in "conduct that is grossly or wantonly
negligent, but not necessarily intentional." N.J. Div. of Youth
& Family Servs. v. T.B., 207 N.J. 294, 305 (2011) (emphasis added)
(quoting G.S. v. N.J. Div. of Youth & Family Servs., 157 N.J. 161,
178 (1999)). Such misconduct occurs when "an ordinary reasonable
person would understand that a situation poses dangerous risks and
acts without regard for the potentially serious consequences." Id.
at 306 (quoting G.S., supra, 157 N.J. at 179). Each case of
alleged abuse "requires careful, individual scrutiny" and is
"generally fact sensitive." N.J. Div. of Youth & Family Servs.
10 A-0410-15T3
v. P.W.R., 205 N.J. 17, 33 (2011). We accord deference to the trial
judge's findings of fact "unless . . . they went so wide of the
mark that the judge was clearly mistaken." N.J. Div. of Youth &
Family Servs. v. G.L., 191 N.J. 596, 605 (2007).
The Supreme Court has noted that "[l]eaving a child unattended
in a car or a house is negligent conduct. N.J. Div. of Child Prot.
& Permanency v. E.D.-O., 223 N.J. 166, 170 (2015); G.S., supra,
157 N.J. at 180-181 ("For example, if a parent left a twoyear old
child alone in a house and went shopping, the child would be
considered a neglected child within the meaning of Title 9. . .
."). Whether such "conduct is negligent or grossly negligent
requires an evaluation of the totality of the circumstances."
E.D.-O., supra, 223 N.J. at 170.
Nancy's argument that the proofs are insufficient rely upon
the premise that she believed her mother was present when she left
Moe home, and therefore, her lapse was only negligence and did not
rise to the level of grossly or wantonly negligent conduct
necessary to sustain a finding of neglect. She relies for support
upon T.B., supra, in which a mother and her four-year-old son lived
in an in-law suite in her parents' home. 207 N.J. at 296. One
evening, the mother put the child to bed and went out for dinner,
believing her mother was at home because her car was in the
11 A-0410-15T3
driveway, she had been ill, and she was "always home" on Sunday
nights. Id. at 297. Unbeknownst to the mother, the grandmother
had "made an impromptu decision to go" to New York with her husband.
Ibid. The child woke up, discovered he was alone in the home and
crossed a busy street to go to a neighbor's home. Ibid. Calling
it a "close case," the Court noted, "[t]his is not a situation in
which [the mother] left her four-year-old son at home alone knowing
there was no adult supervision." Id. at 309. Although the mother's
failure to confirm her mother's presence before leaving "was
clearly negligent," the Court concluded "it did not rise to the
level of gross negligence or recklessness." Id. at 310.
Nancy was well aware her assertion that her mother was home
was refuted by Bob, both Moe and Jack, and her neighbor, and that
the trial judge had earlier rejected her testimony in finding Moe
had been left alone. Ordinarily, a trial judge should not make
findings of fact based upon conflicting statements without the
benefit of testimony. See Gilhooley v. Cty. of Union, 164 N.J.
533, 545 (2000). But here, Nancy was present at the fact-finding
hearing, available to testify and, yet, waived the right to
challenge these opposing versions of events by consenting to the
admission of documentary evidence without testimony. As a result,
she is precluded from claiming the trial judge erred in relying
12 A-0410-15T3
upon documentary evidence. See State v. A.R., 213 N.J. 542, 561
(2013) (holding "trial errors that 'were induced, encouraged or
acquiesced in or consented to by defense counsel ordinarily are
not a basis for reversal on appeal.'" (quoting State v. Corsaro,
107 N.J. 339, 345 (1987)). It follows that Nancy cannot now
complain the evidence was insufficient based upon the version of
the facts she gave – that had been rejected by the trial judge and
was refuted by the statements of other witnesses.
The facts as found by the trial judge are supported by
evidence in the record. For T.B. to lend any support for her
argument, Nancy had to have a reasonable belief that she was not
leaving four-year-old Moe at home unattended. The trial judge did
not find that to be the case. As a result, T.B. provides no
support for her argument.
As the Court found in E.D.-O., supra, 223 N.J., at 170,
leaving a child alone constitutes negligence. The next inquiry is
whether the circumstances support a finding "of gross negligence
or recklessness." T.B., supra, 207 N.J. at 310.
The trial judge found the following "aggravating
circumstances" present here: Nancy knew the lock on the front door
was not working properly, allowing Moe to leave the house without
adult assistance; at four years old, Moe did not know how to call
13 A-0410-15T3
anyone or do anything and was left without any messages; although
Moe was not injured when he wandered outside, there was "certainly"
a "possibility of injury."
The trial judge's findings have ample support in the record
and provide a sufficient basis for the adjudication of neglect
under N.J.S.A. 9:6-8.21.
Affirmed.
14 A-0410-15T3
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284 F.Supp. 344 (1968)
BROTHERHOOD OF LOCOMOTIVE ENGINEERS, Plaintiff,
v.
NATIONAL MEDIATION BOARD et al., Defendants.
Civ. A. No. 2060-66.
United States District Court District of Columbia.
April 26, 1968.
*345 Barclay D. McMillen, Washington, D. C., Harold A. Ross, Ross & Kraushaar, Cleveland, Ohio, for plaintiff.
Francis M. Shea, Richard T. Conway, David W. Miller, Washington, D. C., James R. Wolfe, Chicago, Ill., for carrier defendants.
Joseph L. Rauh, Jr., Rauh & Silard, Isaac N. Groner, Cole & Groner, Washington, D. C., for defendant, Brotherhood of Locomotive Firemen and Enginemen.
Paul A. Sweeney, Sp. Asst. Atty. Gen., Dept. of Justice, Washington, D. C., for defendant National Mediation Bd.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
SIRICA, District Judge.
On the basis of the pleadings and affidavits on file, the Court hereby makes the following Findings of Fact and Conclusions of Law.
FINDINGS OF FACT
1. Each of the defendants Louisville & Nashville Railroad Company, Southern Pacific Company, Great Northern Railway Company, Illinois Central Railroad Company, Atlantic Coast Line Railroad Company, and St. Louis Southwestern Railway Company is a "carrier" as defined in Section 1, subd. First of the Railway Labor Act (45 U.S.C. § 151, subd. First).
*346 2. The plaintiff Brotherhood of Locomotive Engineers (hereinafter called the "BLE"), and the defendant Brotherhood of Locomotive Firemen and Enginemen (hereinafter called the "BLF&E") are unincorporated labor organizations which represent certain employees of the carrier defendants and of various other carriers for purposes of the Railway Labor Act (45 U.S.C. § 151 et seq.).
3. The defendant National Mediation Board (hereinafter called the "NMB") is an agency of the federal government which has certain duties, powers, and functions under the Railway Labor Act (45 U.S.C. § 154).
4. In the railroad industry, the representation of employees by labor organizations is and for many years has been on the basis of crafts or classes of employees.
5. There are and for many years have been two crafts or classes of engine service employees, that is, employees whose basic duties are confined to service in the cabs of locomotives: locomotive engineers and locomotive firemen.
6. The BLE is and for many years has been the duly designated and authorized representative of the craft or class of locomotive engineers on each of the carrier defendants and on most of the other railroads in the United States. On each carrier where that is true, it is undisputed that under the Railway Labor Act the BLE is the exclusive representative of all of the carrier's employees within the craft or class of locomotive engineers and is the only organization authorized to serve upon the carrier under Section 6 of the Railway Labor Act (45 U.S.C. § 156) notices of proposals to change the rates of pay, rules, or working conditions applicable to the craft or class of locomotive engineers, to confer, negotiate, or bargain with the carrier about such proposals, and to enter into agreements with the carrier about the rates of pay, rules, and working conditions applicable to the craft or class of locomotive engineers.
7. The BLF&E is and for many years has been the duly designated and authorized representative of the craft or class of locomotive firemen on each of the carrier defendants and on most of the other railroads in the United States. On each carrier where that is true, it is undisputed that under the Railway Labor Act the BLF&E is the exclusive representative of all of the carrier's employees within the craft or class of locomotive firemen and is the only organization authorized to serve upon the carrier under Section 6 of the Railway Labor Act (45 U.S.C. § 156) notices of proposals to change the rates of pay, rules, or working conditions applicable to the craft or class of locomotive firemen, to confer, negotiate, or bargain with the carrier about such proposals, and to enter into agreements with the carrier about the rates of pay, rules, and working conditions applicable to the craft or class of locomotive firemen.
8. There is no existing separate craft or class of employees, for purposes of the Railway Labor Act, designated or known as "engine service employees" or "locomotive enginemen." The term "engine service employees" is commonly understood in the railroad industry to refer to both locomotive engineers and locomotive firemen.
9. Locomotive engineers generally are needed and used on all locomotives operated by a carrier. Prior to the effectuation of the Award by Arbitration Board No. 282, agreements between the carriers and the BLF&E generally required that a locomotive fireman be used on each locomotive operated by a carrier. That Award, which was issued on November 26, 1963, pursuant to Public Law 88-108 (77 Stat. 132), generally authorized the carriers to eliminate up to ninety percent of locomotive fireman positions on locomotives in freight and yard service.
10. For many years, the carriers' needs for additional locomotive engineers had been met primarily, although not exclusively, by the promotion of qualified *347 locomotive firemen to the craft or class of locomotive engineers. When a locomotive engineer is no longer needed as such, because of fluctuations in the carrier's business or other reasons, he may be demoted, according to his seniority, to the craft or class of locomotive firemen. The collective bargaining agreements between each carrier and the BLE and the collective bargaining agreements between that carrier and the BLF&E contain substantially identical provisions concerning the promotion of qualified locomotive firemen to locomotive engineers and the demotion of unneeded locomotive engineers to locomotive firemen. Those provisions were adopted by the Director General of Railroads in 1919, when the railroads were being operated by the Federal Government, and have been retained, with some modifications, ever since. They do not specify the training required before a locomotive fireman may be qualified for promotion to locomotive engineer or a locomotive engineer may be hired by a carrier.
11. A locomotive fireman who has been promoted to the craft or class of locomotive engineers thereafter is represented by the BLE (except on those few railroads on which the craft or class of locomotive engineers is represented by the BLF&E) for as long as he remains a member of that craft or class; he is no longer represented by the BLF&E; and the rates of pay, rules, and working conditions established by the carrier with the BLE, rather than the rates of pay, rules, and working conditions established by the carrier with the BLF&E, are applicable to such individual. When a locomotive engineer has been demoted to the craft or class of locomotive firemen, thereafter he is represented by the BLF &E (except on those few railroads on which locomotive firemen are represented by the BLE) for as long as he remains a member of that craft or class; he is no longer represented by the BLE; and the rates of pay, rules, and working conditions established by the carrier with the BLF&E, rather than the rates of pay, rules and working conditions established by the carrier with the BLE, are applicable to such individual.
12. Prior to the effectuation of the Award by Arbitration Board No. 282 (Finding of Fact 9, above), the needs of the carriers for additional locomotive engineers generally could be fully satisfied through the promotion of qualified locomotive firemen and the hiring of persons otherwise qualified to become locomotive engineers. There was no necessity for a program to train apprentices to become locomotive engineers, and none of the carriers had such a program. As the number of locomotive firemen employed by the carriers, and thus the number of locomotive firemen qualified for promotion to locomotive engineers, has been reduced following effectuation of the Award by Arbitration Board No. 282, the defendant Louisville & Nashville Railroad Company has found it necessary to provide an additional source for obtaining locomotive engineers. Other carrier defendants and other railroads foresee a similar need within the near future.
13. In order to meet its needs for locomotive engineers, the defendant Louisville & Nashville Railroad Company determined it to be necessary, in April 1966, to establish a program for the training of apprentices to become locomotive engineers. On April 28, 1966, that carrier and the BLE entered into an agreement establishing the rate of pay applicable to such apprentices. While the Louisville & Nashville continues to promote qualified and available locomotive firemen to positions as locomotive engineers, part of its need for additional locomotive engineers is now being met by hiring apprentices who have successfully completed the apprentice training program and qualified to become locomotive engineers. The BLE has been recognized by the Louisville & Nashville as the designated and authorized bargaining representative of the apprentices, and the BLF&E has not applied to the NMB for an investigation to determine whether someone other than the BLE should be certified as the designated *348 and authorized representative of such apprentices.
14. The defendant Great Northern Railway Company and the BLE entered into an agreement concerning the future training of apprentices to become locomotive engineers on September 13, 1967. Apart from the Louisville & Nashville and the Great Northern, none of the carrier defendants has yet established a program for training apprentices to become locomotive engineers. In some instances, the establishment of such a program has been delayed by the dispute between the BLE and the BLF&E as to which organization is entitled to represent apprentices training to become locomotive engineers, but some of the carrier defendants and other railroads believe that the establishment of such an apprentice training program within the relatively near future will be essential in order to assure them of an adequate supply of qualified locomotive engineers.
15. On or about March 25, 1965, the BLF&E served upon the defendant Louisville & Nashville Railroad Company a notice, purportedly pursuant to Section 6 of the Railway Labor Act (45 U.S.C. § 156), which proposed the establishment of an apprentice training program. On or about April 28, 1965, the BLF&E served upon the defendant Southern Pacific Company a notice, purportedly pursuant to Section 6 of the Railway Labor Act, which proposed the establishment of an apprentice training program. On or about November 15, 1965, the BLF&E served upon each of the carrier defendants except the Louisville & Nashville Railroad Company and upon more than 100 other railroads throughout the United States a notice, purportedly pursuant to Section 6 of the Railway Labor Act; this notice consisted of three parts identified as "Notice No. 1," "Notice No. 2," and "Notice No. 3"; the part designated as "Notice No. 3" proposed the establishment of an apprentice training program. "Notice No. 3" and the notices served upon the Louisville & Nashville and the Southern Pacific, described above, are hereinafter called the "apprentice notices."
16. In its apprentice notices, the BLF &E proposed to require the carriers to establish a program for the training of apprentices who, upon successful completion of the program, would become qualified and receive seniority as locomotive engineers, and those notices otherwise relate to the training of apprentices to become locomotive engineers.
17. In correspondence with the carriers shortly after the BLF&E's apprentice notices had been served, the BLE claimed that those notices encroached upon its jurisdiction as the representative of the craft or class of locomotive engineers and that the carriers could not lawfully bargain or agree with the BLF &E upon the apprentice training program proposed in those notices. The BLE has since consistently maintained that position before the NMB and in this Court, as well as otherwise, and threatens to strike and engage in other self-help against any carrier that confers, negotiates, or otherwise agrees with the BLF&E upon the merits of its apprentice notices.
18. In correspondence with the carriers and the NMB and before this Court, the BLF&E has claimed and it now claims that its apprentice notices come within its jurisdiction as the representative of the craft or class of locomotive firemen and that the carrier defendants and the other carriers served with the said notices are required by the Railway Labor Act to confer, negotiate, and otherwise bargain with the BLF&E about the merits of the proposals made therein. There is substantial likelihood that the BLF&E, if not restrained by the court, will engage in strikes or other self-help against the carriers with respect to those proposals if the procedures of the Railway Labor Act are exhausted without an agreement being reached between the said carriers and the BLF&E.
19. Since the BLF&E's apprentice notices were served on the carriers, there has existed, and there now exists, a dispute *349 between the BLF&E and the BLE as to whether apprentices being trained to become locomotive engineers are a part of the craft or class of locomotive firemen.
20. A strike by either the BLE or the BLF&E against any of the carrier defendants would cause grave and irreparable injury to the carrier and would disrupt essential transportation services in interstate commerce.
21. The carrier defendants and the other carriers served with the BLF&E's apprentice notices have expressed their willingness to bargain with the duly designated and authorized representative of apprentices training to become locomotive engineers regarding any valid and bargainable proposal with respect to the rates of pay, rules, or working conditions applicable to such apprentices. The carriers have objected to the BLF&E's apprentice notices, however, on the ground that those notices are invalid and non-bargainable under the Railway Labor Act because they are not within the jurisdiction of the BLF&E as the representative of the craft or class of locomotive firemen. The carriers have contended that they are not required to bargain or agree with the BLF&E with respect to the BLF&E's apprentice notices unless and until it has been definitely determined that the BLF&E is the designated and authorized representative of apprentices training to become locomotive engineers. Consequently, the carriers have refused to bargain with the BLF&E upon the merits of the BLF&E's apprentice notices. At various times, the BLF&E has applied to the NMB for its mediation services with respect to the apprentice notices served upon the carrier defendants and some of the other carriers, but no mediation upon the merits of the notices has occurred. The BLF&E has requested the NMB to terminate its services with respect to such notices, but the NMB has not done so.
22. On or about June 6, 1966, the representative of the carrier defendants and the other carriers that had been served with the BLF&E apprentice notices informed the NMB of the dispute between the BLF&E and the BLE arising out of the BLE&E's apprentice notices and requested mediatory services of the NMB in order that the carriers might "be properly and legally informed as to which of the two disputing organizations may legally bargain for and on behalf of apprentice locomotive engineers." On or about June 21, 1966, the NMB dismissed this application on the ground that the question as posed "involved a question of representation" and that "[s]uch issues are resolved under Section 2, Ninth, of the Railway Labor Act." On or about June 29, 1966, counsel for the carriers requested a hearing for the purpose of securing clarification of the grounds for dismissal. This request was denied by the NMB on June 22, 1966.
23. On or about June 25, 1966, the BLF&E filed a complaint against the defendant Louisville & Nashville Railroad Company in the United States District Court for the Western District of Kentucky (Civil Action No. 5402). In that complaint, the BLF&E sought to restrain the Louisville & Nashville from effectuating and implementing the agreement of April 28, 1966, between the Louisville & Nashville and the BLE (Finding of Fact 13, above). On or about July 5, 1966, the court dismissed that action after concluding that the "action involves a controversy between BLF&E and BLE * * * as to which of those organizations is the exclusive bargaining representative for and in behalf of the apprentice locomotive engineers employed by the L&N and this Court has no jurisdiction to determine that controversy, the determination of which is exclusively within the jurisdiction of the National Mediation Board." An appeal by the BLF&E is now pending in the United States Court of Appeals for the Sixth Circuit (No. 17,588).
24. On or about June 30, 1966, and July 5, 1966, the BLE informed the NMB of the BLF&E's challenge to its right to represent apprentice locomotive engineers employed by the Louisville & Nashville *350 and requested the NMB's services pursuant to Section 2, subd. Ninth of the Railway Labor Act. On July 22, 1966, the NMB dismissed this application on the ground that its authority under Section 2, subd. Ninth does not extend to a "jurisdictional dispute as such," and that "the dispute, if any exists, is not a representation dispute; but may involve an issue as to the right of the employees of one craft or class to do the work that is alleged to be that commonly done by employees of another craft or class. Procedures other than those outlined in Section 2, Ninth, of the Railway Labor Act are available to settle such disputes."
25. On or about July 22, 1966, the NMB, acting upon the mediation cases involving the BLF&E's apprentice notices served upon the defendants Louisville & Nashville Railroad Company and Southern Pacific Company, notified the BLF&E and the carriers' representative that, because of the denial of the carriers' request for a hearing with respect to the dismissal of the carriers' application dated June 6, 1966 (Finding of Fact 22, above), the BLF&E and the carriers "should now enter into discussion concerning the Section 6 notices served by the BLF&E. * * *" Accordingly, the NMB announced that mediation conferences with respect to the apprentice notices served by the BLF&E upon those two carriers would be held on August 4, 1966.
26. On July 27, 1966, the BLE, stating its contention that the BLF&E's apprentice notice as served on the defendant Southern Pacific Company infringed on the BLE's right to represent apprentice locomotive engineers, applied for the NMB's services under Section 2, subd. Ninth of the Railway Labor Act to determine which organization does represent apprentice locomotive engineers on the Southern Pacific for purposes of the Railway Labor Act, in order that the BLE might know whether that carrier could properly and legally bargain with the BLF&E concerning the apprentice notice. On July 28, 1966, the BLE requested the NMB to reconsider its dismissal of the BLE's Section 2 Ninth application with respect to the right to represent apprentice locomotive engineers on the Louisville & Nashville (Finding of Fact 24, above), and to advise the BLE as to the nature of the "[p]rocedures other than those outlined in Section 2 Ninth" which the NMB had stated, in dismissing that application, "are available" to settle the dispute between the BLE and the BLF&E (Finding of Fact 24, above). The NMB did not reply to either the July 27, 1966, request with respect to the situation on the Louisville & Nashville, except that the NMB notified the BLE, on or about August 1, 1966, that mediation conferences would be held as scheduled on August 4, 1966.
27. On August 4, 1966, representatives of the NMB met separately with representatives of the BLF&E and representatives of the carriers, but the merits of the BLF&E's apprentice notices were not discussed. No further mediation with respect to those notices has been scheduled.
CONCLUSIONS OF LAW
1. This action arises under the Railway Labor Act, 45 U.S.C. § 151 et seq., and all parties are subject to that Act. The court has jurisdiction of the parties and the subject matter. 28 U.S.C. §§ 1331, 1337, 1361, 2201, 2202.
2. This action involves an actual case or controversy which is justiciable by this court. Brotherhood of Railway and Steamship Clerks, etc. v. Association for the Benefit of Non-Contract Employees, 380 U.S. 650, 85 S.Ct. 1192, 14 L.Ed.2d 133 (1965); Brotherhood of R.R. Trainmen v. Akron & B. B. R.R., 385 F.2d 581, 55 CCH Lab.Cas. ¶ 11,912, (D.C.Cir., May 12, 1967), petitions for cert. pending; Pan American World Airways, Inc. v. Int'l Bhd. of Teamsters, 275 F.Supp. 986, 56 CCH Lab.Cas. ¶ 12,270, at 20,205 (S.D.N.Y. Nov. 9, 1967).
3. Under the Railway Labor Act, the duly designated and authorized representative of a craft or class of employees of a carrier is the exclusive representative of that craft or class for purposes *351 of bargaining or agreeing with the carrier about the rates of pay, rules, and working conditions applicable to that craft or class. Only the duly designated and authorized representative of a craft or class of employees of a carrier may serve the carrier with a notice, pursuant to Section 6 of the Act, of proposed changes in agreements affecting rates of pay, rules, or working conditions applicable to such craft or class of employees. If an organization serves a carrier with a Section 6 notice concerning the rates of pay, rules, or working conditions of employees who are not within the craft or class represented by the organization, that notice is invalid, and the carrier is not required to confer, participate in mediation, or otherwise bargain with the organization concerning that notice or the proposals made therein. The apprentice notices served by the BLF&E upon the carrier defendants and many other carriers are valid and bargainable under the Railway Labor Act, therefore, only if the BLF&E is the duly designated and authorized representative on such carriers of apprentices training to become locomotive engineers. 45 U.S.C. §§ 152 subds. Second through Tenth, 156; Virginian Ry. v. System Federation, 300 U.S. 515, 548-549, 57 S.Ct. 592, 81 L.Ed. 789 (1937); Southern Pacific Co. v. Switchmen's Union, 356 F.2d 332 (9th Cir. 1965); Order of Railway Cond. & Brakemen v. Switchmen's Union, 269 F. 2d 726 (5th Cir. 1959).
4. There is a bona fide dispute between the BLE and the BLF&E as to whether apprentices training to become locomotive engineers are within the jurisdiction of the BLF&E as the designated and authorized representative of the craft or class of locomotive firemen on the defendant carriers and many other carriers or within the jurisdiction of the BLE as the designated and authorized representative of the craft or class of locomotive engineers on such carriers. The carriers are not required under the Railway Labor Act to confer, participate in mediation, or otherwise bargain with the BLF&E over its apprentice notices unless and until it has been determined, in the manner provided by the Railway Labor Act, that the BLF&E is the duly designated and authorized representative on such carriers of apprentices training to become locomotive engineers. Until such time as it has been so determined and the procedures of the Railway Labor Act otherwise have been exhausted with respect to such notices, the BLF&E may not strike or otherwise engage in self-help against the carriers with respect to such notices or the proposals made therein. 45 U.S.C. §§ 155-160; Southern Pacific Co. v. Switchmen's Union, 356 F.2d 332 (9th Cir. 1965); Ruby v. American Airlines, Inc., 323 F.2d 248, 255 (2d Cir. 1963); Flight Engineers' Inter. Ass'n v. Eastern Air Lines, Inc., 311 F.2d 745 (2d Cir. 1963); Pan American World Airways v. Int'l Bhd. of Teamsters, 275 F.Supp. 986. 56 CCH Lab.Cas. ¶ 12,270 at 20,206 (S.D.N.Y. Nov. 9, 1967); see NLRB v. Downtown Bakery Corp., 330 F.2d 921, 928 (6th Cir. 1965); International Ladies' Garment Workers v. NLRB, 108 U.S.App.D.C. 68, 280 F.2d 616, 621-622 (1960), aff'd, 366 U.S. 731, 81 S.Ct. 1603, 6 L.Ed.2d 762 (1961); NLRB v. Hannaford Bros. Co., 261 F.2d 638, 640 (1st Cir. 1958).
5. The dispute between the BLE and the BLF&E referred to in paragraph 4 above is a dispute among employees as to who are the representatives of such employees, within the meaning and intendment of Section 2, subd. Ninth of the Railway Labor Act (45 U.S.C. § 152, subd. Ninth). General Committee of Adjustment of Brotherhood of Locomotive Engineers for Missouri-Kansas-Texas R. R. v. M.-K.-T. R. Co., 320 U.S. 323, 336, 64 S.Ct. 146, 88 L.Ed. 76 (1943); Switchmen's Union of North America v. NMB, 320 U.S. 297, 302, 64 S.Ct. 95, 88 L.Ed. 61 (1943); Howard v. St. Louis S. F. Ry., 361 F.2d 905, 909 (8th Cir. 1966); Southern Pacific Co. v. Switchmen's Union, 356 F.2d 332, 335 (9th Cir. 1965); Brotherhood of Loc. F. & E. v. Louisville & N. R.R., Civil Action No. 5402 (W.D.Ky.1966), appeal pending (6th Cir.); "Railway Labor Act Amendments," *352 Hearings before House Comm. on Interstate and Foreign Commerce on H.R. 7650, 73rd Cong., 2d Sess., pp. 45, 57 (1934).
6. The applications by the BLE under Section 2, subd. Ninth of the Railway Labor Act with respect to the representation of apprentices being trained to become locomotive engineers on the Louisville & Nashville Railroad Company and the Southern Pacific Company, respectively, were valid and sufficient invocations of the jurisdiction of the NMB under Section 2, subd. Ninth of the Act. Upon receipt of those applications, it was the duty of the NMB to investigate the dispute between the BLE and the BLF &E and to certify to the parties whether such apprentices come within the craft or class of locomotive engineers represented by the BLE or within the craft or class of locomotive firemen represented by the BLF&E, if either. Brotherhood of Railway and Steamship Clerks v. Association for the Benefit of Non-contract Employees, 380 U.S. 650, 85 S. Ct. 1192, 14 L.Ed.2d 133 (1965), and the authorities cited in paragraph 5 above.
7. The jurisdiction of the NMB under Section 2, subd. Ninth of the Railway Labor Act to determine the dispute between the BLE and the BLF&E referred to in paragraph 4 above is exclusive, and this Court does not have jurisdiction to determine that dispute. Brotherhood of Railway and Steamship Clerks v. Association for the Benefit of Non-contract Employees, 380 U.S. 650, 658-661, 85 S.Ct. 1192, 14 L.Ed.2d 133 (1965); Switchmen's Union of North America v. NMB, 320 U.S. 297, 64 S.Ct. 95, 88 L.Ed. 61 (1943); General Committee of Adjustment of Brotherhood of Locomotive Engineers for Missouri-Kansas-Texas R. R. v. M.-K.-T. R. Co., 320 U.S. 323, 336, 64 S.Ct. 146, 88 L.Ed. 76 (1943); General Committee of Adjustment of Brotherhood of Locomotive Engineers for Pacific Lines of Southern Pacific Co. v. Southern Pacific Co., 320 U.S. 338, 64 S.Ct. 142, 88 L.Ed. 85 (1943).
8. In dismissing or failing to act upon the applications of the BLE under Section 2, subd. Ninth of the Railway Labor Act on the ground that the applications were beyond the jurisdiction of the NMB under Section 2, subd. Ninth, the NMB failed to perform its mandatory duty under that Section. This court has authority to declare the statutory duty of the NMB in this action and to compel the NMB to perform its duty under Section 2 Ninth of the Act with respect to the BLE's applications. Brotherhood of Railway and Steamship Clerks v. Association for the Benefit of Non-Contract Employees for Missouri-Kansas-Texas R.R., 380 U.S. 650, 661, 85 S.Ct. 1192, 14 L.Ed.2d 133 (1965); Air Line Dispatchers Ass'n v. NMB, 89 U.S. App.D.C. 24, 189 F.2d 685 (1951).
9. There is no genuine issue as to any material fact, and the BLE and carrier defendants are entitled to judgment as a matter of law, as hereinbefore set forth. Fed.R.Civ.P. 56.
10. The motion of the BLF&E for summary judgment should be denied, and the motions of the BLE and the carrier defendants for summary judgment should be granted as provided in the judgment being entered herewith.
JUDGMENT
Motions for summary judgment and affidavits having been filed by each of the parties except the defendant National Mediation Board, memoranda having been filed by all the parties, counsel for all the parties having been heard, the Court having determined that the motion for summary judgment filed by the defendant Brotherhood of Locomotive Firemen and Enginemen should be denied and that the motions for summary judgment filed by the plaintiff and by the carrier defendants should be granted, the Court having made its findings of fact and conclusions of law which are being filed herewith, and due deliberation having been had, it is hereby
Ordered, adjudged and decreed:
1. That the defendant National Mediation Board has the power and duty, *353 which it is hereby directed to exercise under Section 2, subd. Ninth of the Railway Labor Act (45 U.S.C. § 152, subd. Ninth), to investigate the dispute between the plaintiff and the defendant Brotherhood of Locomotive Firemen and Enginemen, pursuant to the applications heretofore filed by plaintiff with the National Mediation Board, and to certify to the parties whether apprentices being trained to become locomotive engineers come within the craft or class of locomotive engineers represented by the BLE or within the craft or class of locomotive firemen represented by the BLF&E, if either.
2. That the defendants Louisville & Nashville Railroad Company, Southern Pacific Company, Great Northern Railway Company, Illinois Central Railroad Company, Atlantic Coast Line Railroad Company, and St. Louis Southwestern Railway Company, respectively, are not required to confer, participate in mediation, or otherwise bargain with respect to the apprentice notices served upon them by the Brotherhood of Locomotive Firemen and Enginemen unless and until the National Mediation Board determines, pursuant to an investigation under Section 2, subd. Ninth of the Railway Labor Act, that the Brotherhood of Locomotive Firemen and Enginemen is the duly designated and authorized representative of apprentices training to become locomotive engineers on such carrier defendant.
3. That the Brotherhood of Locomotive Firemen and Enginemen, each of its lodges, divisions, locals, officers, agents, and employees, and all persons acting in concert with them, are hereby enjoined from authorizing, calling, encouraging, permitting, or engaging in any strikes and from picketing the premises of any of the carrier defendants referred to in paragraph 2 above for the purposes of requiring any of the said carrier defendants to bargain or agree with the Brotherhood of Locomotive Firemen and Enginemen concerning the proposals made in its apprentice notices unless and until: (1) the National Mediation Board determines, pursuant to an investigation under Section 2, subd. Ninth of the Railway Labor Act, that the Brotherhood of Locomotive Firemen and Enginemen is the duly designated and authorized representative of apprentices training to become locomotive engineers on such carrier defendant, and (2) the Brotherhood of Locomotive Firemen and Enginemen otherwise exhausts the procedures of the Railway Labor Act with respect to its apprentice notices.
4. Plaintiff and the carrier defendants shall recover from the defendant Brotherhood of Locomotive Firemen and Enginemen their taxable costs.
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United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
January 10, 2007
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
Clerk
No. 05-41872
MARIA GENOVEVA ANAYA, MARIO ANAYA,
EDUARDO ANAYA, JESSICA ANAYA, AYDHEE ANAYA,
Plaintiffs-Appellants,
versus
TRAYLOR BROTHERS, INC.,
Defendant-Appellee.
Appeal from the United States District Court
for the Southern District of Texas
Before REAVLEY, STEWART, and CLEMENT, Circuit Judges.
CARL E. STEWART, Circuit Judge:
Humberto Anaya, an employee of Traylor Bros., Inc. (“Traylor”), suffered fatal injuries on
a barge while constructing a bridge. Soon thereafter, Traylor’s insurer began paying compensation
benefits to his beneficiaries (the “Anayas”). Approximately two months later, the Anayas filed suit
against Traylor for exemplary damages. The district court granted Traylor’s motion for summary
judgment. The court concluded that Traylor’s insurer paid the compensation benefits under the
Longshoremen and Harbor Workers’ Compensation Act (the “LHWCA”), which precludes the
recovery of exemplary damages. In this appeal, the Anayas argue that Traylor’s insurer was actually
paying benefits pursuant to the Texas Workers’ Compensation Act (the “TWCA”). We affirm the
district court’s judgment.
I. FACTUAL AND PROCEDURAL BACKGROUND
Humberto Anaya worked for Traylor as a carpenter on the Texas Department of
Transportation Galveston Causeway project. At the time of his fatal accident, Anaya was
constructing a bridge that connected Interstate 45 from Galveston Island to the mainland. On
October 15, 2004, while Anaya drilled bolt holes, a form collapsed and crushed him underneath a
concrete beam. Anaya died the same day. On October 18, 2004, the Anayas submitted an application
to the Texas Workers’ Compensation Commission (the “Commission”) for survivor benefits. The
Anayas subsequently received a series of benefit checks from Traylor’s insurer. On November 16,
2004, the Anayas’ attorney sent a notice of representation to the insurer. In response, Traylor’s
insurer informed the Anayas that the benefits were paid pursuant to the Longshoremen and Harbor
Workers’ Compensation Act, not the Texas Workers’ Compensation Act.
On December 27, 2004, the Anayas filed a request to receive TWCA benefits. Two days
later, the Anayas filed suit against Traylor for exemplary damages based on Traylor’s alleged gross
negligence. In February 2005, Traylor’s insurer filed a dispute with the Commission to establish
whether the Anayas were entitled to benefits under the state or federal compensation scheme. On
August 25, 2005, the Commission found in favor of the insurer, ruling that the Anayas did not qualify
for TWCA benefits. Traylor then moved for summary judgment in the ongoing litigation because the
LHWCA bars gross negligence claims for exemplary damages. The district court granted summary
judgment to Traylor, reasoning that the LHWCA applied due to Anaya’s work on navigable waters.
II. STANDARD OF REVIEW
2
This court reviews de novo a district court’s grant of summary judgment, applying the same
legal standards as the district court. Machinchick v. P.B. Power, Inc., 398 F.3d 345, 349 (5th Cir.
2005). If no genuine issue of material fact exists, then the moving party is entitled to judgment as a
matter of law. FED. R. CIV. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). The court
must view all evidence in the light most favorable to the non-movant. Broussard v. Parish of
Orleans, 318 F.3d 644, 650 (5th Cir. 2003). If the evidence would permit a reasonable trier of fact
to find for the non-moving party, then summary judgment should not be granted. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 247-48 (1986).
III. DISCUSSION
A.
Under the TWCA, an injured worker’s beneficiaries mayfile suit for exemplarydamages, TEX.
LAB. CODE ANN. § 408.001(b), but the LHWCA prohibits the recovery of exemplary damages, 33
U.S.C. §§ 904, 905(a). To receive benefits under the LHWCA, a worker must satisfy both a situs
and status test. Munguia v. Chevron U.S.A., Inc., 999 F.2d 808, 810 (5th Cir. 1993). The situs test
concerns geographic areas covered by the LWHCA, whereas the status test concerns an employee’s
type of work activities. P.C. Pfeiffer Co. v. Ford, 444 U.S. 69, 78 (1979). The situs test includes
injuries “occurring upon the navigable waters of the United States (including any adjoining pier,
wharf, dry dock, terminal, building way, marine railway, or other adjoining area customarily used by
an employer in loading, unloading, repairing, dismantling, or building a vessel).” Bienvenu v. Texaco,
Inc., 164 F.3d 901, 904 (5th Cir. 1999) (citing 33 U.S.C. § 903(a)). The status test defines an
employee as “any person engaged in maritime employment, including any longshoreman or other
3
person engaged in longshoring operations, and any harborworker including a ship repairman,
shipbuilder, and ship-breaker.” Id. (quoting 33 U.S.C. § 902(3)). In addition,
a worker injured in the course of his employment on navigable waters is engaged in
maritime employment and meets the status test only if his presence on the water at the
time of injury was neither transient or fortuitous. The presence, however, of a worker
injured on the water and who performs a “not insubstantial” amount of his work on
navigable waters is neither transient nor fortuitous.
Bienvenu, 164 F.3d at 908 (footnote omitted).
At the time of his accident, Anaya was undoubtedly located on navigable waters, which
satisfies the situs test. In this appeal, the status test determines whether the LHWCA applies to the
Anayas request for benefits. Neither this Circuit nor the Supreme Court provide a definitive
explanation of what constitutes a transient and fortuitous presence on navigable water. Id.; see also
Director v. Perini N. River Assocs., 459 U.S. 297, 324 n.34 (1983). In Bienvenu, the Fifth Circuit
sitting en banc contrasted the holdings of Fontenot v. AWI, Inc., 923 F.2d 1127 (5th Cir. 1991), and
Randall v. Chevron U.S.A., Inc., 13 F.3d 888 (5th Cir. 1994), as modified by 22 F.3d 568. The en
banc court affirmed Fontenot, which held that “a worker who spent 40% of his worktime on shore,
30% on fixed platforms and 30% on oil exploration and production vessels was engaged in maritime
employment because he was injured while on actual navigable waters, in the course of his
employment.” Bienvenu, 164 F.3d at 908-09 (citing Fontenot, 923 F.2d at 1130). Yet, the court
overruled Randall, which held that the LHWCA covered a mechanic performing all of his work duties
on navigable waters because “[h]e was simply transported to and from his workstation-a stationary
platform-by boat.” Id.
Unlike the worker in Randall, and more similar to the analysis in Fontenot, Anaya spent the
majority of his time working on navigable waters. Anaya performed his construction duties on a
4
barge located on navigable waters, and a boat carried Anaya between the shore and his work site. The
district court found that Anaya regularly worked on the barge and his October 15 work assignment
was not an aberration from his normal work tasks. Therefore, the LHWCA covers the Anayas’ claim
for benefits.
B.
Section 406.091(a)(2) of the TWCA prohibits benefits to workers covered by analogous
federal laws. The TWCA reads in pertinent part that “a person covered by a method of compensation
established under federal law” is not subject to the statute. TEX. LAB. CODE ANN. § 406.091(a)(2).
The Anayas argue that a twilight zone of concurrent jurisdiction, established by the Supreme Court’s
holdings in Davis v. Dep’t of Labor, 317 U.S. 249 (1942), and Sun Ship, Inc. v. Pennsylvania, 447
U.S. 715 (1980), permits workers to elect benefits under either the TWCA or LHWCA. And
pursuant to this allowance, they elected to receive benefits under the TWCA, thus preserving their
right to file suit for exemplary damages. The Commission held that Anaya “is not entitled to all rights
and remedies under” the TWCA and is limited to recovery under the LHWCA. We agree with the
Commission’s analysis and interpretation of the federal and state compensation schemes as applied
in this instance, and therefore, reject the Anayas’ argument that Anaya was in a twilight zone. See
Hahn v. Ross Island Sand & Gravel Co., 358 U.S. 272, 273 (1959) (per curiam) (“[T]he employee
could not [elect a remedy] if the case were not within the ‘twilight zone,’ for then the
Longshoreman’s Act would provide the exclusive remedy.”). An employee subject to Anaya’s work
conditions on navigable waters may only recover under the LHWCA. Accordingly, an election of
benefits was not available for the Anayas.
IV. CONCLUSION
5
Based on Bienvenu and the explicit language of the TWCA, we affirm the district court’s
grant of summary judgment to Traylor.
6
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} |
213 S.W.3d 58 (2006)
STATE of Missouri, Plaintiff-Respondent,
v.
Ronald Lee HARRISON, Defendant-Appellant.
No. 26980.
Missouri Court of Appeals, Southern District, Division Two.
October 16, 2006.
Motion for Rehearing or Transfer Denied November 6, 2006.
Application for Transfer Denied February 27, 2007.
*63 Amy M. Bartholow, Columbia, for Appellant.
Jeremiah W. (Jay) Nixon, Atty. Gen., Lisa M. Kennedy, Assistant Attorney General, Jefferson City, for Respondent.
PHILLIP R. GARRISON, Judge.
Following a jury trial, Ronald Lee Harrison ("Defendant") was convicted of the class A felony of second degree murder, a violation of 565.021,[1] the class A felony of first degree robbery, a violation of 569.020, and armed criminal action, a violation of 571.015. He was sentenced to life imprisonment, a concurrent term of thirty years imprisonment, and a consecutive term of twenty years imprisonment, respectively. Defendant now appeals, alleging seven instances of trial court error. We affirm.
FACTS
This case stems from the murder and robbery of Defendant's grandmother, Reba Magouirk ("Victim"). Viewed in the light most favorable to the verdict, the evidence reveals the following.
On January 1, 2003, Defendant, who owed a drug debt to Keithy Frederick ("Frederick"), was at his sister Evelyn Blagg's ("Evelyn")[2] house. He was expecting Frederick to stop by and he told his sister, Donna Tackett ("Donna"), and her husband, Frankie Tackett ("Frankie"), to tell Frederick he was going for a walk. Frederick stopped by and requested that Donna and Frankie tell Defendant that he "wasn't one to be messed with." Frankie did not believe that Frederick was threatening Defendant but believed he just wanted his money. Defendant did not seem worried when he received the message.
On the morning of January 3, 2003, Defendant, who was driving a black Cadillac, went to work to pick up his paycheck in the amount of $255.81. Defendant then went to a grocery store in Campbell, where he cashed his check and purchased a half pint of Jim Beam whiskey. Around 10:30 a.m. Defendant stopped at his cousin's house where he borrowed a t-shirt, drank whiskey, and visited for about forty-five minutes.
Defendant went to Victim's house around 11:30 a.m. Victim lived with her son, Jerry Magouirk ("Jerry"), and another son, Rick Magouirk ("Rick"), would also stay with her on occasion. Victim and Jerry were at the duplex when Defendant arrived. Karen Stevens ("Stevens"), Victim's home health care worker, arrived around 1:10 p.m. Both Stevens and Jerry noticed that Defendant had been drinking. Jerry left around 1:30 p.m., but Defendant stayed and went to sleep on Victim's couch.
Stevens left to run errands, but she later returned to bring Victim some food. Around 2:30 p.m., Stevens left to care for a man who lived across the street. As she was leaving, the mail carrier delivered Victim's $400 social security check.
Around 5:30 p.m., Victim's grandson, Joshua McMillen ("Joshua"), drove by Victim's house with his fiancée and saw Defendant standing in the front door wearing a dark shirt with a white shirt underneath. Joshua drove around the block and saw Defendant standing in the same position as he was driving by a second time.
Around 6:30 p.m., Heather Lyons, who lived in the other half of the duplex where *64 Victim lived, heard three loud "bangs" coming from next-door. Also around that time, Rick was at Carolyn Mason's ("Mason") trailer when he saw Defendant drive by. Mason's trailer was catty-corner to the back of Victim's duplex. Defendant turned around and spoke with Rick outside the trailer for a couple of minutes, during which Rick thought Defendant seemed "awful nervous."
Later, around 7:00 to 7:30 p.m., Defendant arrived at David Moore's ("Moore") house with a half pint of whiskey. Defendant told Moore that he knew Moore suspected that he had been involved in stealing $300, but he pulled out some folded cash, and told Moore that he did not have to steal money, because he worked on a riverboat, and had $1,000 at the moment. Defendant left Moore's house around 8:00 p.m.
Rick left Mason's trailer shortly after 8:00 p.m. and returned to Victim's house. When Rick walked into the duplex, he saw Victim sitting in her chair. Rick thought Victim was sleeping, but she did not respond when he tried to wake her. He then noticed that there was blood on her forehead and her left hand was jerking, so he called the police. Rick noticed that Victim's purse was missing.
Officer Justin Hankins ("Officer Hankins") and Officer Marvin Riley ("Officer Riley"), with the Campbell Police Department ("Police Department"), received a dispatch around 8:45 p.m., and arrived at Victim's duplex a few minutes later. Victim was unconscious, but breathing when the officers arrived. The officers saw that Victim had wounds to her head, and noticed blood in front of her, behind her, and on the chair she was sitting in.
Evelyn and Amanda Nelson ("Amanda"), Victim's granddaughters and Defendant's sisters, arrived at the duplex after hearing that Victim was hurt. They were accompanied by Ronnie Nelson ("Ronnie") and Barry Blankenship ("Barry"). Amanda held a towel to Victim's head and tried to wake her. Shortly thereafter, an ambulance arrived, and Victim was taken to Kennett hospital to receive treatment for her injuries.
Victim was pronounced dead at 10:05 p.m. that night. An examination revealed that she had been struck over the head a minimum of seven to eight times with a long, narrow, blunt instrument. The trauma to Victim's head caused multiple skull fractures and brain injury. The forensic examiner estimated that Victim's head injuries were received anywhere between 5:00 and 7:00 p.m.
While at the hospital, Amanda, noticing that she had Victim's blood on her hair, hands and clothes, went into the bathroom to clean up. The evidence was that Amanda hugged several relatives both before and after she cleaned up in the bathroom. While outside, Amanda saw Defendant arrive wearing stained jeans and a dark buttoned up shirt over a white t-shirt. She told Defendant that Victim had died, and Defendant embraced her in a bear hug. Both Amanda and Defendant were crying.
Members of the family were asked to meet with officers at the Police Department that night. Officers wanted to talk to anyone who had seen or talked to Victim that day. Deputy Terry Key ("Deputy Key") interviewed Defendant, but did not consider him a suspect at that time. Defendant told Deputy Key that he had taken a nap at Victim's house from 11:30 a.m. to 3:00 p.m. that day. After he woke up, Defendant said that he watched television with Victim until about 6:30 p.m. when he got Victim's mail and put it on the coffee table before leaving for Moore's house. Defendant said he was at Moore's house from 7:00 to 8:00 p.m.
*65 Around 1:50 a.m. on January 4, 2003, Defendant was interviewed by Sergeant William Cooper ("Sergeant Cooper") and Sergeant Jeffrey Heath ("Sergeant Heath"). In addition to repeating what he had told Deputy Key, Defendant added that he left Victim's house around 4:30 p.m. that day to get gas and cigarettes, but returned sometime thereafter. He also stated that before he left he brought in Victim's mail and then got her a plastic cup filled with water and sat it on the TV tray next to her. Defendant said he was at Jerry Blagg's house when he learned that Victim had been assaulted.
During a break in the interview, Sergeants Heath and Cooper were told that someone had seen blood on Defendant's shoes. When the interview resumed, Sergeant Heath asked Defendant if he could see his shoes. Defendant obliged, and both officers saw what they believed to be blood droplets. Sergeants Heath and Cooper stopped the interview at that point and advised Defendant of his Miranda[3] rights. Defendant said that he understood his rights, and signed a written waiver at 2:57 a.m. Defendant stated that he did not have any idea where the blood had come from, and that Victim was alive when he last saw her. Defendant gave officers his consent to search his car and his clothes, which he said were in a bag at Jerry Blagg's house. When Defendant was told that he was not free to go, he asked for an attorney. At that point, Sergeant Heath terminated the interview and informed Deputy Walter Dearing ("Deputy Dearing"), Commander of the Dunklin County Major Case Squad, that Defendant had asked for an attorney. Deputy Dearing then entered the interrogation room where Defendant was sitting and told another officer that Defendant would be held in custody because his family members were making death threats towards him. Defendant responded, "I don't blame them."
Defendant returned to the Police Department on January 9, 2003, after agreeing to speak with Deputy Dearing, and signed a written waiver of his Miranda rights. Deputy Dearing began to interview Defendant and he again talked about his whereabouts on January 3, 2003, and said it was not possible that the blood on his shoes was Victim's blood. During the interview, the police received the preliminary results indicating that the blood splatter on Defendant's shoes was Victim's blood. Defendant said, "I couldn't do that," and again asserted his right to counsel. The interview ended, and Defendant asked Deputy Dearing if he was going to be arrested. Deputy Dearing told him yes, and Defendant then asked if he could have a cigarette and a cup of coffee. While Defendant was drinking the coffee he began to cry, and said, "I don't remember. I don't remember. . . . I been [sic] doing drinking alcohol and doing marijuana and meth up until three days ago." Defendant then said, "I want the death penalty, I demand the death penalty."
Defendant's clothes and shoes were sent to the Missouri State Highway Patrol Crime Laboratory. The DNA on Defendant's t-shirt and shoe matched Victim's DNA. Defendant was charged with first degree murder, armed criminal action and first degree robbery. A jury trial was held from March 11-16, 2005. The jury acquitted Defendant of first degree murder, but found him guilty of second degree murder, armed criminal action and first degree robbery. The trial court followed the jury's recommendation and sentenced Defendant as indicated earlier. This appeal followed.
*66 OPINION
Defendant raises seven points on appeal. In the first, he argues that the trial court erred in sustaining the State's objection to defense counsel's comment in closing argument that forensic examiner Brian Hoey ("Hoey") "contaminated" a known control sample with Victim's DNA, and in improperly commenting on the evidence to the jury, when stating, "[t]he jury will recollect the testimony of [] Hoey. The Court does not recollect his describing, in his words, `contamination.'" Defendant alleges that the trial court's instruction invaded the province of the jury on the key element of the State's case. We disagree.
The challenged ruling and comment by the trial court are set out below:
[Defense Counsel]: No matter what you think of Amanda's testimony, you can't ignore the fact that there was some contamination of a control sample in the DNA analysis and that it was contaminated with DNA that had alleles that were similar to the alleles that matched the alleles of [Victim].
[Hoey] messed up. He contaminated a known control sample with [Victim's] DNA
[Prosecutor]: Your Honor, again, I'm going to have to object. There's no absolutely no evidence whatsoever that there was any contamination by any sample to any other sample and that's just an absolute misstatement.
The Court: The jury will recollect the testimony of [] Hoey. The Court does not recollect his describing, in his words, "contamination." Please proceed.
Defense counsel then continued her closing argument as follows:
The reason we know this happened is because it was a known control sample. It's something that comes in the lab kits for the DNA lab and you run it and there's a paper in there that says when you this known control, you will get the following results. And if you don't get the following results, there's a problem. And which there was a problem because there was another source of DNA in that known control sample and that DNA matched the DNA of [Victim]. And the only reason we knew about it and the only reason we found it is it happened in a known control sample.
. . . .
And another thing. He didn't report that there was a problem with that control sample. He didn't report that it was somehow mixed in with some other source of DNA. And when you mix two things together when you're not supposed to, there's no other word for it. It is contamination. And he didn't report it. . . .
"To ensure that a defendant receives a fair trial, a trial judge must maintain absolute impartiality during criminal proceedings." State v. Garriott, 151 S.W.3d 403, 411 (Mo.App. W.D.2004). "In the trial of any criminal case the court shall not, in the presence of the jury, sum up or comment on the evidence." Rule 27.06. See also Section 546.380. "A question or comment from a trial judge must not express his or her opinion of evidence in the case[.]" State v. Bass, 81 S.W.3d 595, 613 (Mo.App. W.D.2002). "This does not mean, however, that the judge may not correct counsel when necessary, as long as it is not done in a contemptuous manner[.]" State v. Mitchell, 693 S.W.2d 155, 160 (Mo.App. E.D.1985). Neither does it mean that a judge "may not summarize evidence in explanation of a ruling, as long as it is not a statement of the facts as a matter of law[.]" Id.
When determining the propriety of a trial court's comments on the evidence, *67 we consider whether (1) the comment was volunteered by the trial court, (2) was not made in response to an objection as part of the trial court's ruling, (3) was made in the presence of the jury (4) could have been construed by the jury to the prejudice of defendant, or (5) indicated to the jury that it was not to reach its own determination of the facts. State v. Winrod, 68 S.W.3d 580, 590-91 (Mo.App. S.D.2002).
Hoey's testimony relevant to this point is as follows:
[Hoey]: [I]t appeared as though the unknown DNA typed [sic] showed up in the positive control, which would indicate that the sample that the peaks there were no peaks and ended up getting into the positive control and was not in the tube it was supposed to be in.
. . . .
As soon as I found out that there was a problem, I discarded that test and repeated my testing.
. . . .
[Prosecutor]: So there wasn't any transfer from that to any of the other tests that you ran that you did rely on?
[Hoey]: Not to my knowledge, no.
. . . .
[Defense Counsel]: . . . [T]hey tell you, this is what it is. If you run this positive control, you should only get this result.
[Hoey]: That's correct.
[Defense Counsel]: All right. And in fact, you got a mixed result?
[Hoey]: Yes, I did.
[Defense Counsel]: You got more DNA than was just in that positive control?
[Hoey]: Yes, I did.
[Defense Counsel]: It indicates contamination occurred; didn't it?
[Hoey]: Not necessarily, no.
. . . .
[Defense Counsel]: So it look [sic] like [Victim's] DNA somehow got contaminated with this positive control?
[Hoey]: The DNA that is consistent with the shoe, the shirt and [Victim].
The trial court's statement that it "does not recollect his describing, in his words, `contamination[,]'" was a correct summarization of the evidence in explanation of its ruling. It was not volunteered, but was made in response to an objection. While the statement was made in the presence of the jury, it was short and neutral and could not be construed by the jury to the prejudice of Defendant. The trial court did not indicate to the jury that it was not to reach its own determination of the facts. Rather, the jury was instructed to "recollect the testimony of [] Hoey."
The record does not support Defendant's contentions that "the trial court specifically told the jury that the court did not recall testimony about contamination," or that "the trial court's comment on the key DNA evidence as not being contaminated left the jury with the impression that the DNA was reliable." The trial court merely stated that it "does not recollect his describing, in his words, `contamination.'" The jury was free to believe, based on the evidence presented, that key DNA evidence was contaminated. In fact, defense counsel was permitted to make that very argument, without objection, to the jury:
He didn't report that there was a problem with that control sample. He didn't report that it was somehow mixed in with some other source of DNA. And when you mix two things together when you're not supposed to, there's no other word for it. It is contamination. And he didn't report it.
The jury was free to decide for itself whether the DNA evidence was contaminated. We do not read anything in the *68 record indicating a bias, prejudice or hostility towards Defendant that would prejudice the minds of the jury and deprive him of a fair trial. See State v. Johnson, 687 S.W.2d 706, 711 (Mo.App. W.D.1985). Point denied.
In his second point, Defendant argues that the trial court erred in denying his motion to suppress his statement, "I don't blame them." Defendant asserts that the statement was taken in violation of his Fifth Amendment privilege against self-incrimination, because it was given in response to custodial interrogation after he had invoked his right to counsel. We disagree.
"Where a motion to suppress was overruled and the evidence was introduced at trial, appellate review considers the evidence presented both at the suppression hearing and at trial in determining whether the motion should have been granted." State v. Daggett, 170 S.W.3d 35, 45 (Mo. App. S.D.2005)(quoting State v. Reed, 157 S.W.3d 353, 356 (Mo.App. W.D.2005)). Appellate review is limited to a determination of whether substantial evidence exists to support the trial court's ruling. State v. West, 58 S.W.3d 563, 567 (Mo.App. W.D. 2001). "We defer to the trial court's opportunity to determine the weight of the evidence and credibility of the witnesses when deciding whether sufficient evidence supports the trial court's determination." Daggett, 170 S.W.3d at 45.
"To protect the privilege against self-incrimination guaranteed by the Fifth Amendment, . . . police must terminate interrogation of an accused in custody if the accused requests the assistance of counsel." Minnick v. Mississippi, 498 U.S. 146, 147, 111 S.Ct. 486, 488, 112 L.Ed.2d 489, 494 (1990). The accused "is not subject to further interrogation by the authorities until counsel has been made available to him, unless the accused himself initiates further communication, exchanges, or conversations with the police." Edwards v. Arizona, 451 U.S. 477, 484-85, 101 S.Ct. 1880, 1885, 68 L.Ed.2d 378, 386 (1981). "[O]fficials may not reinitiate interrogation without counsel present, whether or not the accused has consulted with his attorney." Minnick, 498 U.S. at 153, 111 S.Ct. 486.
In the present case, Defendant sought to suppress a statement made on January 4, 2003. On that date, after being advised of his Miranda rights, Defendant signed a written waiver and agreed to speak with Sergeant Heath. When Defendant was told that he was not free to leave, he invoked his right to counsel. Sergeant Heath ended the interview at that point. Deputy Dearing then entered the interrogation room where Defendant was sitting and told another officer that Defendant would be held in custody because his family members were making death threats towards him. Defendant responded, "I don't blame them."
Once an accused has asserted his constitutional right to speak with an attorney, "[i]f the interrogation continues without the presence of an attorney and a statement is taken, a heavy burden rests on the government to demonstrate that the [accused] knowingly and intelligently waived his privilege against self-incrimination and his right to retained or appointed counsel." Miranda, 384 U.S. at 475, 86 S.Ct. 1602. "[H]owever, [not] all statements obtained by the police after a person has been taken into custody are to be considered the product of interrogation." Rhode Island v. Innis, 446 U.S. 291, 299, 100 S.Ct. 1682, 1689, 64 L.Ed.2d 297, 307 (1980). "[T]he term `interrogation' under Miranda refers not only to express questioning, but also to any words or actions on the part of the police (other than those *69 normally attendant to arrest and custody) that the police should know are reasonably likely to elicit an incriminating response from the suspect." Innis, 446 U.S. at 301, 100 S.Ct. 1682.
We do not find that any interrogation occurred on January 4, 2003, after Defendant invoked his right to counsel. Deputy Dearing's statement to another officer that Defendant would be held in custody because he had received death threats was not "reasonably likely to elicit an incriminating response from [Defendant]." Id. "[T]he police surely cannot be held accountable for the unforeseeable results of their words or actions. . . ." Id. at 301-02, 100 S.Ct. 1682. We find no violation of Defendant's privilege against self-incrimination, as Defendant's statement was not the product of interrogation. The trial court did not err in denying Defendant's motion to suppress the statements he made to police on January 4, 2003. Point denied.
In his third point, Defendant argues that the trial court erred in denying his motion to suppress statements given on January 9, 2003, including a statement regarding his drug use, and his statement that, "I deserve the death penalty." Defendant maintains that those statements were taken in violation of his Fifth Amendment privilege against self-incrimination, because police reinitiated contact with Defendant after he had invoked his right to counsel on January 4, 2003. We disagree.
We reiterate that in assessing the propriety of the trial court's ruling on a motion to suppress, appellate review is limited to a determination of whether substantial evidence exists to support the trial court's ruling. West, 58 S.W.3d at 567. "We defer to the trial court's opportunity to determine the weight of the evidence and credibility of the witnesses when deciding whether sufficient evidence supports the trial court's determination." Daggett, 170 S.W.3d at 45.
After Defendant invoked his right to counsel on January 4, 2003, he was held for twenty hours then released. On January 8, 2003, Defendant's sisters went to the Police Department to discuss the investigation of Victim's murder. Deputy Dearing told the sisters that if he had talked to Defendant on January 4, 2003, he might have been able to get a confession or rule him out as a suspect, but now he could only talk to Defendant if Defendant wanted to talk to him. Amanda offered to call Defendant to try and get him to come and talk to Deputy Dearing.
Amanda called Defendant later that day and told him to talk to Deputy Dearing in order to prove his innocence. That evening, she called Deputy Dearing and asked him if he wanted to speak to Defendant. Deputy Dearing replied that while he would like to speak to Defendant, he could not do so, because Defendant had invoked his right to counsel. He made clear to Amanda that Defendant did not have to speak with him, but if he chose to do so, he must do so voluntarily.
When Deputy Dearing arrived at the Police Department the morning of January 9, 2003, he learned that Defendant had called and left his number, so he called Defendant and left him a message. A few minutes later, Defendant called back, saying that Amanda had told him that Deputy Dearing wanted to talk to him. Deputy Dearing responded that he was told by Amanda that Defendant wished to speak to him, and while he would have liked to talk to him the first night he was interviewed, he could not speak to him now unless Defendant wanted to. Defendant said he would speak to him, and they agreed to meet at the Police Department that afternoon.
*70 Defendant arrived at the Police Department around 2:00 p.m., and again told Deputy Dearing that he wanted to speak with him. Deputy Dearing advised Defendant of his Miranda rights, and Defendant executed a written waiver of those rights. Some time after the interview had begun, Deputy Dearing was informed that the preliminary results of the blood splatters on Defendant's shoes showed that the splatter was Victim's blood. After being informed of the results, Defendant said, "I couldn't do that," and "I wouldn't let nobody else do that to my grandmother." He then asked if he was going to be arrested, and Deputy Dearing said yes.
Defendant once again asked for an attorney, and the interview ended. Upon request, Defendant was brought a cup of coffee. As he was drinking his coffee he became very emotional and he proceeded to make further statements. Deputy Dearing informed Defendant that he should not say anything because he had asked for an attorney, but Defendant spontaneously and repeatedly said, "I don't remember." He said that he had been "drinking alcohol and doing marijuana and meth up until three days ago." He then said, "I want the death penalty, I demand the death penalty."
In Edwards, 451 U.S. at 484, 101 S.Ct. 1880, the Supreme Court of the United States explained:
[A]lthough we have held that after initially being advised of his Miranda rights, the accused may himself validly waive his rights and respond to interrogation, the Court has strongly indicated that additional safeguards are necessary when the accused asks for counsel; and we now hold that when an accused has invoked his right to have counsel present during custodial interrogation, a valid waiver of that right cannot be established by showing only that he responded to further police-initiated custodial interrogation even if he has been advised of his rights. (citations omitted).
Under the Miranda-Edwards rule, an accused who has requested to speak to an attorney "is not subject to further interrogation by the authorities until counsel has been made available to him, unless the accused himself initiates further communication, exchanges, or conversations with the police." Edwards, 451 U.S. at 484-85, 101 S.Ct. 1880. This means that police may not reinitiate interrogation unless counsel is present. Minnick, 498 U.S. at 153, 111 S.Ct. 486.
In the present case, Defendant's statements on January 9, 2003, were properly admitted because: (1) Defendant was subjected to custodial interrogation only after he had reinitiated contact with law enforcement following a break in custody and then knowingly and voluntarily waived his right to counsel; and (2) the statements made after he had reasserted his right to counsel were volunteered statements made after interrogation had ceased.
"Edwards does not foreclose finding a waiver of Fifth Amendment protections after counsel has been requested, provided the accused has initiated the conversation or discussions with the authorities[.]" Id. at 156, 111 S.Ct. 486. "[B]efore a suspect in custody can be subjected to further interrogation after he requests an attorney there must be a showing that the `suspect himself initiates dialogue with the authorities.'" Oregon v. Bradshaw, 462 U.S. 1039, 1044, 103 S.Ct. 2830, 2834, 77 L.Ed.2d 405, 411-12 (1983)(quoting Wyrick v. Fields, 459 U.S. 42, 46, 103 S.Ct. 394, 395, 74 L.Ed.2d 214, 217 (1982)).
In the present case, Defendant himself initiated "further communication, exchanges, or conversations with the police," after he had first invoked his right to *71 counsel. Edwards, 451 U.S. at 484-85, 101 S.Ct. 1880. On appeal, Defendant argues that Deputy Dearing's "active role in recruiting [Defendant's] family members to persuade [Defendant] to reinitiate contact with him was an action that [Deputy] Dearing knew was likely to elicit an incriminating response from [Defendant]," and therefore, "[a]ny subsequent reinitiation of contact with the police and waiver of his right to counsel were not voluntary." However, in deciding whether sufficient evidence supports the trial court's determination regarding a motion to suppress, we defer to the trial court's opportunity to determine the credibility of the witnesses. Daggett, 170 S.W.3d at 45. Here, the trial court found that "[a]ll of the evidence at hearing [sic] indicated that Defendant initiated the subsequent contact and communication with Deputy Dearing on January 9." We find there was sufficient evidence supporting the trial court's finding. The record reveals that Defendant initiated contact with Deputy Dearing when he called and said he wished to speak with him. Deputy Dearing cautioned that he could only speak to Defendant if Defendant wanted to because Deputy Dearing was obligated to respect his invocation of his right to counsel. Of his own accord, Defendant later arrived at the Police Department. On these facts, we believe that there was not a violation of the Miranda-Edwards rule, and any statements taken before his reassertion of his right to counsel were properly admitted.
We also note that those statements taken before Defendant's reassertion of his right to counsel on January 9, 2003, followed a break in custody of several days. In State v. Farris, 125 S.W.3d 365, 371 (Mo.App. W.D.2004), the western district of this Court held "that a break of custody removes the concerns that underlie the prophylactic principles of Miranda and Edwards." The court reasoned that "[w]hen the accused `is released from police custody, he is no longer subject of the inherently compelling pressures of custodial interrogation and his Fifth Amendment rights which the Miranda-Edwards prophylactic rule was designed to protect are no longer in jeopardy.'" Id. at 371-72 (quoting Commonwealth v. Wyatt, 455 Pa.Super. 404, 688 A.2d 710, 713 (1997)). Finding the reasoning of Farris to be sound, we held in State v. Bremenkamp, 190 S.W.3d 487, 492-93, that the Miranda-Edwards rule does not extend beyond a "break in custody."
In keeping with this Court's prior holdings, when Defendant was again in custody on January 9, 2003, he was required to reassert his right to counsel, in order for the Miranda-Edwards rule to apply. Instead, Defendant waived his right to counsel and agreed to speak with police.
Defendant also alleges trial court error in the admission of statements made by him after he had reasserted his right to counsel. After Defendant requested to speak with an attorney on January 9, 2003, the interrogation ceased. Upon request, Defendant was brought a cup of coffee, and as he was drinking his coffee he proceeded to make further statements. Deputy Dearing informed Defendant that he should not say anything because he had asked for an attorney, but Defendant spontaneously and repeatedly said, "I don't remember." He said that he had been "drinking alcohol and doing marijuana and meth up until three days ago." He then said, "I want the death penalty, I demand the death penalty."
Once an accused has asserted his constitutional right to speak with an attorney, "[i]f the interrogation continues without the presence of an attorney and a statement is taken, a heavy burden rests on the government to demonstrate that the [accused] *72 knowingly and intelligently waived his privilege against self-incrimination and his right to retained or appointed counsel." Miranda, 384 U.S. at 475, 86 S.Ct. 1602. "[H]owever, [not] all statements obtained by the police after a person has been taken into custody are to be considered the product of interrogation." Innis, 446 U.S. at 299, 100 S.Ct. 1682. When Defendant reasserted his right to counsel, the protection of the Miranda-Edwards rule was once again triggered and any subsequent statements resulting from custodial interrogation without counsel present would be inadmissible. However, the record clearly shows that the statements made by Defendant were volunteered and were not the product of custodial interrogation. Therefore, those statements were properly admitted.
The trial court did not abuse its discretion in denying Defendant's motion to suppress the statements he made to police on January 9, 2003, because Defendant reinitiated contact with police after a break in custody of several days before knowingly and voluntarily waiving his right to counsel, and those statements made by Defendant after he had reasserted his right to counsel were not the product of custodial interrogation. Point denied.
In his fourth point, Defendant argues that the trial court erred in precluding evidence that officers smelled ether near Victim's back door and near Mason's trailer because such evidence was relevant to challenge the credibility of the prosecution witness Rick.
"The trial court is vested with broad discretion in the admission or exclusion of evidence." State v. DeClue, 128 S.W.3d 864, 871 (Mo.App. S.D.2004). This discretion "includes the duty to determine the relevance and materiality of evidence proffered for impeachment." State v. Wilson, 105 S.W.3d 576, 585 (Mo.App. S.D. 2003). "We will not disturb a trial court's ruling in that regard absent a clear abuse of that discretion." Id. The trial court abuses its discretion where its ruling is clearly against the logic of the circumstances and is so arbitrary and unreasonable that it shocks the sense of justice and indicates a lack of careful consideration. State v. Smith, 996 S.W.2d 518, 521 (Mo. App. W.D.1999). In addition, "[w]e review for prejudice and not mere error; thus, we will affirm the trial court's ruling unless it was so prejudicial as to deprive Defendant of a fair trial." DeClue, 128 S.W.3d at 871.
In the present case, the trial court refused to allow the defense to present evidence regarding the smell of ether in Victim's trash can and near Mason's trailer. In an offer of proof, Officer Hankins testified that on the night Victim was attacked he smelled ether coming from a trash can right outside Victim's back door. Officer Hankins explained that ether is associated with methamphetamine activity. He also noticed a similar smell coming from an area near Mason's trailer. However, he could not tell which trailer the smell was coming from. The court denied Defendant's offer of proof. Defense counsel renewed his objection to the exclusion of this evidence in his motion for new trial.
Defendant explains that "if Rick had been involved in methamphetamine activity at [Victim's] residence, he would have had a motive to fabricate a story about his activities or about [Defendant's] demeanor that evening." Thus, he argues that Rick may have had an interest in deflecting attention away from himself and onto Defendant. Defendant argues that "the exclusion of evidence bearing on Rick's credibility was extremely prejudicial to [Defendant's] right to present a defense and his right to a fair trial." We disagree.
*73 "[A]s a general proposition, the credibility of witnesses is always a relevant issue in a lawsuit." Smith, 996 S.W.2d at 521. "Anything that has the legitimate tendency of throwing light on the accuracy, truthfulness, and sincerity of a witness is proper for determining the credibility of the witness." State v. Strughold, 973 S.W.2d 876, 891 (Mo.App. E.D. 1998). "However, attacks on a witness' credibility in criminal proceedings are subject to limitations, and not every attack will be allowed." Smith, 996 S.W.2d at 521.
"[T]he credibility of a witness cannot be attacked by showing a specific act of immorality or by showing that [his] general moral character is bad." State v. Adams, 51 S.W.3d 94, 101 (Mo.App. E.D. 2001) (citations omitted). "A witness' credibility may not be impeached with evidence of a mere arrest, investigation, or criminal charge, not resulting in a conviction." State v. Wolfe, 13 S.W.3d 248, 258 (Mo. banc 2000). "The impeaching testimony should be confined to the real and ultimate object of the inquiry, which is the reputation of the witness for truth and veracity. In other words, specific acts of misconduct, without proof of bias or relevance, are collateral, with no probative value." Id. (citations omitted).
A specific act of misconduct has probative value where it is relevant to show a witness' bias. Kuehne v. State, 107 S.W.3d 285, 294 (Mo.App. W.D.2003). Proof of prior misconduct may be used to impeach a witness where inquiry shows (1) a specific interest; (2) a possible motivation to testify favorably for the State; or (3) an expectation of leniency. Id. The specific interest exception applies only where the impeachment evidence demonstrates a particular bias against the defendant. Id.
None of the bias exceptions apply to the present case. First, the proffered evidence does not demonstrate that Rick had a particular bias against Defendant. Second, the proffered evidence does not show that Rick had a possible motivation to testify favorably for the State. Third, there is no evidence that Rick was charged with any crime relating to the smell of ether, therefore, the proffered evidence fails to show that Rick had an expectation of leniency.
It is also noteworthy, that the proffered evidence fails to establish any connection between Rick and the ether smell. Officer Hankins testified that he believed he smelled ether coming from an area outside Victim's residence. However, he was not absolutely positive that he was smelling ether, and he did not look into the trash can to see what might be causing the smell. Officer Hankins also testified that he smelled ether in the area of Mason's trailer. While Rick had recently been at Mason's trailer, Officer Hankins testified that he could not tell which trailer the smell was coming from. No physical evidence was recovered that would indicate that ether was being used for methamphetamine manufacture.
"[I]t is not error to exclude offers to impeach on immaterial or collateral matters." Wolfe, 13 S.W.3d at 258. The trial court did not abuse its discretion in precluding Defendant from presenting evidence regarding the smell of ether outside of Victim's residence and Mason's trailer. Defendant's fourth point is denied.
In his fifth point, Defendant argues that the trial court erred in allowing the prosecution to conduct an experiment before the jury using a cup of ice, because the demonstration was unreliable and did not aid the jury in determining any fact at issue.
*74 The following additional facts are relevant to this point on appeal. Hoey estimated that Victim's head injury was received anywhere between 5:00 and 7:00 p.m. on January 3, 2003. Defendant told officers he was present at Victim's residence from around 4:30 until 6:30 p.m. Officer Riley testified that when he arrived at Victim's residence shortly after 8:45 p.m., he noticed a full cup of ice sitting next to Victim on her TV tray. Defendant told Sergeant Cooper and Deputy Dearing that he got Victim a glass of water before he left. A photograph taken later showed a cup of water with no ice.
Defendant explains that "[i]f Officer Riley was correct, that there was a cup of ice sitting next to [Victim], then a reasonable inference is that someone was very recently present in her home close to the time that Rick discovered her at 8:30 p.m." In an attempt to cast doubt on Officer Riley's testimony, the prosecution conducted a demonstration with a glass full of ice in the courtroom. When defense counsel noted that the prosecutor had set a glass full of ice with no liquid in it on a table in the courtroom, he asked that it be removed. The prosecutor explained that he wanted to put the cup of ice into evidence as demonstrative evidence. He wished to show to the jury that a glass filled with ice will not generate the amount of water seen in the photograph of the glass on Victim's TV tray, so that the glass of ice Officer Riley saw must have contained both ice and water.
Defense counsel argued that the experiment was neither scientific nor reliable. Defense counsel complained that there was no way to know if the cup contained the same kind of ice cubes present at the scene; whether they were frozen to the same level as ice cubes from Victim's freezer; whether it was the same kind of cup; whether the temperatures were the same; or whether somebody had been holding the cup for any period of time. The prosecutor replied that none of the issues raised had any bearing on how much water would be left after the ice melted. The trial court ruled that the glass could remain, and that defense counsel could make arguments about any deficiencies in the demonstration.
Deputy Dearing testified that a glass full of ice had been sitting in the courtroom since 8:20 a.m. He explained that now over four hours and ten minutes later the ice was almost completely melted. Deputy Dearing did not know the size of the ice cubes Officer Riley observed at Victim's residence, and he did not know whether the conditions in the courtroom were the same as in Victim's residence.
Demonstrative evidence is "evidence which is not the actual evidence connected with either the defendant or the crime charged." State v. Rehberg, 919 S.W.2d 543, 551 (Mo.App. W.D.1995). "Demonstrative evidence is admissible if it establishes a fact at issue, throws light on the issue, or aids the jury in any way in arriving at the correct verdict." State v. Hahn, 35 S.W.3d 393, 396 (Mo.App. E.D. 2000). "The precondition for admissibility, however, is that [such evidence] fairly represents the conditions which it is offered to show.'" State v. Black, 618 S.W.2d 466, 469 (Mo.App. W.D.1981). "The trial court is vested with broad discretion in admitting or rejecting demonstrative evidence, due to its superior vantage point for balancing the probative value of such evidence against its prejudicial effect." State v. Candela, 929 S.W.2d 852, 867 (Mo.App. E.D.1996).
Here, the prosecution did not prove that the demonstration at issue represented the conditions which it was offered to show; therefore, the demonstration procedure was erroneous. See Black, *75 618 S.W.2d at 469. However, this does not end our inquiry. "In matters involving the admission of evidence, this Court reviews for prejudice, not mere error, and will reverse only if the error was so prejudicial that it deprived the defendant of a fair trial." State v. Hayes, 113 S.W.3d 222, 226 (Mo.App. E.D.2003). "A defendant must show there was a reasonable probability that without the admission of the evidence the verdict would have been different." State v. Moore, 88 S.W.3d 31, 36 (Mo.App. E.D.2002).
We cannot say that Defendant was deprived of a fair trial by the admission of the questioned evidence. Nor can we say that without the admission of the evidence, the verdict would have been different. Officer Riley's testimony, if believed by the jury, does not negate the fact that Defendant, by his own admission, was alone with Victim during the time the Hoey testified that the assault occurred. Furthermore, Defendant was given the opportunity to argue the deficiencies in the demonstration and prevent the jury from being misled. Deputy Dearing admitted under cross-examination that he had never seen the cup of ice at Victim's residence. He admitted that he did not know whether the ice used in the demonstration and the conditions in the courtroom were even remotely similar to the conditions at Victim's residence. Defense counsel further reminded the jury in closing argument that there was no evidence that the cup of ice in the courtroom was subjected to the same conditions and environmental factors as the ice in Victim's cup. We find no prejudice in the admission of the ice demonstration. Point denied.
In his sixth point, Defendant argues that the trial court erred in permitting the prosecutor to use a button-down blue shirt as demonstrative evidence of what Defendant was wearing on the night of Victim's death. Specifically, Defendant argues that there was no showing that the shirt was similar in character to the shirt Defendant was allegedly wearing that night.
Defendant presented evidence at trial that the Victim's DNA found on his t-shirt could have been transferred when he hugged Amanda at the hospital. Amanda testified that when she saw Defendant at the hospital, he was wearing a dark colored button-up shirt with a white t-shirt underneath. She explained that she could see a white collar because the dark outer shirt was not buttoned up all the way. During his examination of Amanda, the prosecutor showed Amanda a blue-button up shirt. He told the jury that the shirt he held was not the shirt Defendant was wearing on January 3, 2003. The prosecutor asked Amanda if the shirt was similar to the one Defendant was wearing the night of the murder. Amanda responded that she was "not sure." Using the shirt as an example, Amanda demonstrated how far up Defendant's shirt was buttoned. In closing argument the prosecutor placed the blue shirt on a mannequin and argued:
The shirt, [Amanda] told you, was buttoned up to the second button here. She said it actually the shirt that he had on was buttoned up the button was a little higher than this. Well, folks, (unbuttons shirt on mannequin) one of those bloodstains that was [Victim's] blood was down there under that closed-up shirt and under that coat.
Defense counsel objected to the introduction of the shirt into evidence, and to the prosecutor's use of the shirt on the mannequin in closing arguments. These objections were renewed in Defendant's motion for new trial.
Defendant argues that "the prosecutor here did not establish the conditions that would have made the demonstrative evidence *76 relevant and probative," because Amanda was unable to "testify that it was similar in nature to the shirt that she saw [Defendant] wearing." We disagree.
"Demonstrative evidence is admissible if it establishes a fact at issue, throws light on the issue, or aids the jury in any way in arriving at the correct verdict." Hahn, 35 S.W.3d at 396. "The precondition for admissibility, however, is that [such evidence] fairly represents the conditions which it is offered to show." Black, 618 S.W.2d at 469. "The trial court is vested with broad discretion in admitting or rejecting demonstrative evidence, due to its superior vantage point for balancing the probative value of such evidence against its prejudicial effect." Candela, 929 S.W.2d at 867.
The demonstrative evidence at issue here was a fair representation of the conditions it was offered to show. Amanda testified that Defendant was wearing a button-up shirt on the night of Victim's murder. The blue shirt used at trial assisted Amanda in demonstrating how far Defendant's shirt was buttoned up that night. The fact that Amanda was "not sure" that the blue shirt was similar to the shirt worn by Defendant did not affect the reliability of the demonstration. In addition, the demonstration aided the jury in determining whether Defendant could have gotten Victim's blood on his t-shirt when he hugged Amanda at the hospital. We cannot say the trial court abused its discretion in allowing the blue shirt to be used as demonstrative evidence. Point denied.
In his seventh point, Defendant argues that the trial court erred in allowing Donna and Frankie to testify as to Frederick's statement that he "wasn't one to be messed with." Defendant asserts that this statement "is classic hearsay, and it was prejudicial." We disagree.
"Hearsay statements are out-of-court statements used to prove the truth of the matter asserted, which, as a rule, are inadmissible." State v. Lockett, 165 S.W.3d 199, 204 (Mo.App. E.D.2005). "Generally, hearsay is objectionable because the one making the statement is not under oath or subject to cross-examination." State v. Baker, 23 S.W.3d 702, 715 (Mo.App. E.D.2000). "[T]he admission of hearsay evidence against a defendant violates his right to confront the witnesses against him." State v. Debler, 856 S.W.2d 641, 648 (Mo. banc 1993). However, "in order for an error in admission of hearsay to require reversal, Defendant must show that he suffered undue prejudice as a result of the error." State v. Haddock, 24 S.W.3d 192, 195 (Mo.App. W.D.2000). When hearsay evidence is merely cumulative of other evidence properly admitted at trial, such prejudice does not exist. Id. at 196.
Here, whether the statement in question is considered hearsay or not, its admission cannot be prejudicial, because it was cumulative of other non-hearsay evidence. Frederick's statement was offered as evidence of Defendant's motive to kill Victim. It was the State's theory that Defendant killed Victim because he needed money to pay a drug debt to Frederick. Defendant told Donna and Frankie that he owed Frederick money for methamphetamine and Frederick was looking for him. This evidence was admissible as admissions of Defendant. See State v. Wallingford, 43 S.W.3d 852, 855 (Mo.App. W.D.2001) (explaining that, "[i]n the case of an admission by a party opponent, the declarant is a party to the case, and an objection on the basis of hearsay cannot make sense because the party against whom it is offered does not need to cross-examine himself") (citations and quotations omitted). Thus even if Frederick's statement that "he wasn't one to be messed with" was erroneously *77 admitted, it was merely cumulative of Defendant's statements made to Donna and Frankie. Point denied.
The judgment and sentence of the trial court is affirmed.
BATES, C.J., and BARNEY, J., concur.
PHILLIP R. GARRISON, Judge.
ON MOTION FOR REHEARING OR MOTION TO TRANSFER
In his "Motion for Rehearing or Transfer to the Missouri Supreme Court," Defendant requests this Court to review the testimony of the State's DNA expert witness, Brian Hoey, as it relates to Defendant's first point on appeal, maintaining that "[t]his Court's selective recitation of the facts, and its omission of key facts that bear directly on the issue, distorts the record and does not provide [Defendant] a fair review of the trial court's ruling." Specifically, Defendant points to the omission of the following testimony in the Court's analysis:
[Defense counsel]: Okay. And on April 21st, one of your bench notes said at that point, "positive control okay"?
[Hoey]: Yes.
[Defense counsel]: But you never put in your bench notes that there was a possibility of contamination in that 4/19 run?
[Hoey]: I didn't realize it at that time.
[Defense counsel]: Okay. You just recently discovered it when you were asked to go back and look at it?
[Hoey]: That's correct.
Consideration of this testimony does not change the result reached in our opinion for two reasons: (1) Defendant references this testimony only in his reply brief; and (2) Defendant has not shown that he was prejudiced by the trial court's ruling.
The testimony which Defendant complains was "inexplicably omit[ted]" from this Court's opinion is not quoted or cited to in Defendant's initial brief filed with this Court. In his brief, Defendant cites to various portions of the record in reference to Hoey's testimony, but not once does he quote the above testimony or provide this Court with a citation to the page of the transcript where the testimony is found. "All statements of fact and argument contained in any brief shall have specific page references to the legal file or the transcript." Rule 30.06(e); see also Rule 84.04(i). "[T]his requirement is mandatory and essential for the effective functioning of appellate courts, which cannot spend time searching the record to determine if factual assertions are supported by the record. This would effectively require the court to act as an advocate for the non-complying party[.]" Brown v. Shannahan, 141 S.W.3d 77, 80 (Mo.App. E.D.2004). It is not the duty of this court to search the transcript or record to discover the facts substantiating a point on appeal. Block Financial Corp. v. America Online, Inc., 148 S.W.3d 878, 890 (Mo.App. W.D.2004).[1]
In addition, Defendant's inclusion of the testimony in his reply brief does not cure the original omission. Id. The sole purpose of a reply brief is to rebut the arguments raised in the respondent's brief. Estate of Dugger v. Dugger, 110 S.W.3d 423, 427 n. 3 (Mo.App. S.D. 2003). A reply brief is not a place to raise *78 new points on appeal because it deprives the respondent of his opportunity to answer an issue presented by an appellant. Block Financial Corp., 148 S.W.3d at 890. Therefore, omission of the legal and evidentiary basis for an allegation of error "is not cured by the discussion in the reply brief." Zakibe v. Ahrens & McCarron, Inc., 28 S.W.3d 373, 389 (Mo.App. E.D. 2000).
In this case, the State had no opportunity to respond to Defendant's reliance on the "omitted" testimony quoted in his reply brief. This is evidenced by the fact that the State does not address this testimony in its respondent's brief. When an appellant believes that a specific portion of the record is so tantamount as to affect the ultimate disposition upon appellate review, this portion of the record should be highlighted in the statement of facts and the argument portion of the appellant's brief.
Nevertheless, consideration of the "omitted" testimony does not change this Court's decision. As we stated in our opinion, the trial court's statement was short and neutral, and did not indicate to the jury that it was not to reach its own determination of the facts. In stating that the jury was free to believe, based on the evidence presented, that key DNA evidence was contaminated, we noted that defense counsel was allowed to make the following argument to the jury without objection:
He didn't report that there was a problem with that control sample. He didn't report that it was somehow mixed in with some other source of DNA. And when you mix two things together when you're not supposed to, there's no other word for it. It is contamination. And he didn't report it.
We also note that Defendant continues to misconstrue the trial court's statement. Defendant's allegation of error is premised on the following statement made by the trial court: "The jury will recollect the testimony of [] Hoey. The Court does not recollect his describing, in his words, `contamination.'" In his brief, Defendant states that "the trial court specifically told the jury that the court did not recall testimony about contamination." (emphasis added). In his motion for rehearing, Defendant asserts that "the trial court's recollection that Hoey did not testify about contamination was clearly incorrect[.]" (emphasis added). A correct recitation of this statement is important to understanding the result reached in our opinion. Clearly, much of defense counsel's cross-examination of Hoey was devoted to a discussion about contamination. However, the trial court was correct in its recollection that Hoey never described in his words contamination. As we stated in our opinion, "[a] question or comment from a trial judge must not express his or her opinion of evidence in the case[.]" State v. Bass, 81 S.W.3d 595, 613 (Mo.App. W.D. 2002). This does not mean, however that the trial court "may not summarize evidence in explanation of a ruling, as long as it is not a statement of the facts as a matter of law[.]" State v. Mitchell, 693 S.W.2d 155, 160 (Mo.App. E.D.1985).
The trial court never stated that it did not recall testimony about contamination. This distinguishes the present case from that relied on by Defendant, Rose v. Kansas City, 125 Mo.App. 231, 102 S.W. 578, 580 (Mo.App.K.C.1907), in which the trial court stated incorrectly in response to an objection: "I don't think that was the testimony of Dr. Wilson." In finding error with the trial court's statement, the Court stated that "[t]he fact that defendant's counsel was stating the evidence of Dr. Wilson correctly, the action of the court practically deprived defendant of the benefit *79 of that evidence[.]" Id. The jury, in this case, was never given the impression that Hoey did not testify about contamination, and the possibility of contamination of the DNA evidence was reinforced by defense counsel's closing argument as previously discussed.
For the aforementioned reasons, consideration of the testimony which Defendant complains was omitted does not change the result reached in our opinion. Other issues raised in Defendant's motion require no further discussion. Defendant's motion is denied.
BATES, C.J., and BARNEY, J., concur.
NOTES
[1] All references to statutes are to RSMo (2000) and all references to rules are to Missouri Rules of Criminal Procedure (2004), unless otherwise indicated.
[2] We refer to those parties with surnames in common by their first name in order to avoid confusion.
[3] Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966).
[1] While this citation is to a civil case, its proposition holds for criminal cases, as the rules governing an appellant's brief are the same for civil and criminal cases. See State v. Watkins, 102 S.W.3d 570, 571 (Mo.App. S.D.2003)(explaining "[w]hether civil or criminal, all briefs filed in an appellate court must comply with Rule 84.04"); see also Rules 30.06 and 84.04.
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12 So.3d 231 (2009)
TORRES
v.
STATE.
No. 2D09-2076.
District Court of Appeal of Florida, Second District.
June 18, 2009.
Decision without published opinion Mandamus denied.
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[Cite as Communicare v. Ohio Dept. of Job & Family Servs., 2019-Ohio-3757.]
COURT OF APPEALS OF OHIO
EIGHTH APPELLATE DISTRICT
COUNTY OF CUYAHOGA
COMMUNICARE D.B.A.
NORTHWESTERN
HEALTHCARE CENTER :
Plaintiff-Appellant, :
v. :
No. 106874
OHIO DEPARTMENT OF
JOB AND FAMILY SERVICES, :
Defendant-Appellee. :
JOURNAL ENTRY AND OPINION
JUDGMENT: AFFIRMED
RELEASED AND JOURNALIZED: September 19, 2019
Civil Appeal from the Cuyahoga County Court of Common Pleas
Case No. CV-17-886013
Appearances:
Nicholas A. Kulik, for appellant.
Dave Yost, Ohio Attorney General, and Rebecca L.
Thomas, Assistant Attorney General, for appellee.
EILEEN A. GALLAGHER, J.:
Appellant Communicare d.b.a. Northwestern Healthcare Center
(“Communicare”), as authorized representative of Mohsen Fanous, appeals the trial
court’s judgment affirming the decision of the Ohio Department of Job and Family
Services (“ODJFS”) that denied Fanous’ application for Medicaid benefits. As
discussed below, because Fanous’ known countable resources exceeded the
Medicaid eligibility limit, we affirm.
Factual and Procedural Background
As reflected in the trial court’s decision, Fanous’ Medicaid application
was initially denied by the Cuyahoga County Department of Job and Family Services
because Fanous failed to verify potential resources. Fanous sought review by
ODJFS. The agency remanded the matter to the county for re-evaluation.
The county subsequently determined that Fanous owned real estate
with an equity value of approximately $16,000. It also made subsequent requests
for Fanous to verify other potential resources. Fanous failed to respond to multiple
verification requests related to four active businesses and ten vehicles.
Because Fanous’ known resources exceeded the Medicaid eligibility
limit and he failed to verify other resources, the county denied his application.
Fanous again appealed to ODJFS. The agency determined that his
application was properly denied. Fanous appealed to the director of ODJFS and the
resulting administrative appeal decision affirmed the denial of Fanous’ application.
As reflected in the agency decision, at the time Fanous applied for Medicaid:
[Fanous] owned four pieces of real property and one was sold for
$9,000. Of the other properties, one had an equity value of $10,004,
the second had an equity of $3,667.51 and the third had an equity value
of $2,178. * * * The value of the properties all exceeded the resource
limit both individually and collectively * * *.
Fanous sought review of the agency decision by the Cuyahoga County
Court of Common Pleas. Following its review, the court found that the decision
denying Fanous’ application was “supported by reliable, probative, and substantial
evidence.” It cited a “two-fold” basis for denying the application: (1) Fanous’ real
property constituted resources in excess of the Medicaid limit and (2) Fanous failed
to verify other potential countable resources. The court found that Fanous’ real
property was an independent and sufficient basis for denying the application.
Regardless of whether Fanous was entitled to assistance in responding to the
outstanding verifications, the application was properly denied because Fanous “still
owns resources, in the form of real property, that exceed the Medicaid eligibility
limit.”
The court found an alternative basis for affirming the agency decision,
determining that Communicare lacked legal standing to pursue the appeal in the
trial court.
Assignments of Error
On appeal to this court, Communicare asserts three assignments of
error:
1. The court of common pleas erred in dismissing Mr. Fanous’ appeal
for lack of jurisdiction and the dismissal is inconsistent with this court’s
holding that a designated authorized representative has standing to
bring an appeal of a Medicaid denial on behalf of the applicant.
2. The court of common pleas erred in dismissing Mr. Fanous’ appeal
in concluding that he owns available resources that exceed the
Medicaid eligibility limit.
3. The court of common pleas erred in dismissing Mr. Fanous’ appeal
in concluding that Mr. Fanous and his authorized representation failed
to provide the required verification to ODJFS.
We address the assignments of error in an order that aids our analysis.
Law and Analysis
Standard of Review
In the context of this appeal, this court reviews whether the court of
common pleas abused its discretion in finding that the administrative agency’s
decision was supported by “reliable, probative, and substantial evidence.” Tiggs v.
Ohio Dept. of Job & Family Servs., 2018-Ohio-3164, 118 N.E.3d 985, ¶ 13 (8th Dist.)
citing Kinasz-Reagan v. Ohio Dept. of Job & Family Servs., 164 Ohio App.3d 458,
2005-Ohio-5848, 842 N.E.2d 1067 (8th Dist.), ¶ 11, fn. 2. The Supreme Court has
explained the extent of our review as follows:
In reviewing an order of an administrative agency, an appellate court’s
role is more limited than that of a trial court reviewing the same order.
It is incumbent on the trial court to examine the evidence. Such is not
the charge of the appellate court. The appellate court is to determine
only if the trial court has abused its discretion.
Id., quoting Lorain City School Dist. Bd. of Edn. v. State Emp. Relations Bd., 40
Ohio St.3d 257, 260-261, 533 N.E.2d 264 (1988); see also Brown v. Ohio Dept. of
Job & Family Servs., 8th Dist. Cuyahoga No. 92008, 2009-Ohio-1096, ¶ 11 (“[T]he
record must show more than an error of law or judgment; it implies that the court’s
attitude is unreasonable, arbitrary, or uncounscionable.”).
Real Property as a Countable Resource
In the second assignment of error Communicare argues that the trial
court erred by considering Fanous’ real property as a countable resource for purpose
of determining his Medicaid eligibility. Communicare does not dispute that the
value of Fanous’ real property exceeded the resource limit. Instead, it argues that
the properties should not have been considered as countable resources because
Fanous was not able to sell them.
At the time Fanous applied for Medicaid benefits, per the relevant
regulation, if an applicant’s countable resources exceeded the $2,000 “resource
limit,” that person was not eligible for coverage. See former Ohio Admin.Code
5160:1-3-05.1(B)(8)(a), effective Aug. 1, 2016 (“‘Resource limit’ means maximum
combined value of all resources an individual can have an ownership interest in and
still qualify for medical assistance.”). For this purpose, “resources” include:
[C]ash, other liquid asset, personal property, and real property an
individual * * * has an ownership interest in, has the legal ability to
access in order to convert to cash (if not already cash), and is not legally
prohibited from using for support and maintenance.
former Ohio Admin.Code 5160:1-3-05.1(B)(7), effective Aug. 1, 2016.
Communicare argues that the trial court erred by considering Fanous’
real property for eligibility purposes because Fanous was not able to sell the
properties. Fanous argues that because he could not sell the properties, he lacked
the “ability to convert [the properties] to cash.” Thus, according to its argument, the
properties fail to meet the definition of “resources.”
We disagree. As stated, the plain language of the rule required a
person to have the “legal ability to access in order to convert to cash (if not already
cash) * * *.” Whether Fanous was able to find a purchaser is a wholly different
consideration from what the regulation contemplated, namely whether Fanous had
the legal authority to sell the properties in the first place.
Additionally, Communicare argues that the trial court erred by
considering the properties as resources because Fanous was “unable to convert two
of his three real properties into cash within twenty (20) days.” As a basis for this
argument, he cites a definition of “liquid resources” from an unrelated federal
regulation.
We also reject this argument. Notwithstanding the federal regulation,
nothing in former Ohio Admin.Code 5160:1-3-05.1 imposed a requirement that a
resource must be able to be converted to cash within 20 days before it can be
considered for eligibility purposes.
The trial court did not abuse its discretion in affirming the
administrative appeal decision. The record is clear: the value of Fanous’ real
property was in excess of the Medicaid resource limit. We overrule this assignment
of error.
Standing
In the first assignment of error, Communicare argues that the trial
court erred by determining it did not have standing to bring the appeal on the basis
of Tiggs v. Ohio Dept. of Job & Family Servs., 2018-Ohio-3164, 118 N.E.3d 985 (8th
Dist.), which was decided during the pendency of this appeal.
In Tiggs, this court recognized that a long-term care nursing facility,
which had been designated as a resident’s Medicaid authorized representative, had
standing to file an appeal on behalf of the resident to challenge the termination of
his Medicaid benefits. See also Juanita Fowler Life Care Ctrs. of Am., Inc. v. Ohio
Dept. of Job & Family Servs., 8th Dist. Cuyahoga No. 106989, 2019-Ohio-1238,
¶ 10-13 (recognizing Tiggs is controlling and permits Medicaid authorized
representative to appeal to the trial court).
Similar to Tiggs, Fanous executed a “designation of authorized
representative” form authorizing Communicare to “[t]ake any action that may be
needed to ensure that I receive or continue to receive [Medicaid benefits].”
As to determining whether Communicare is a proper party to bring
this appeal, we find Tiggs to be indistinguishable and controlling. ODJFS disagrees
with this conclusion, but relies on arguments we have previously rejected, and has
thus “not identified any basis upon which to distinguish Tiggs from this case.”
Fowler at ¶ 13.
{¶ 21} However, regardless of whether the trial erred in determining that
Communicare did not have standing to appeal, Communicare suffered no prejudice.
See Cincinnati Ins. Co. v. Thompson & Ward Leasing Co., 158 Ohio App.3d 369,
2004-Ohio-3972, 815 N.E.2d 1126, ¶ 19 (10th Dist.), citing Smith v. Flesher, 12 Ohio
St.2d. 107, 233 N.E.2d 137 (1967) (“Claimed error alone may not support reversal;
the party assigning error must demonstrate prejudice resulting therefrom.”). As
previously discussed, the trial court addressed the merits of the appeal and found
sufficient basis to conclude that the agency’s decision was appropriate because
Fanous’ real property caused him to exceed the resource limit and we found the
court did not abuse its discretion in so concluding. Accordingly, the court’s error in
determining Communicare lacked standing is harmless.
{¶ 22} We overrule this assignment of error.
Assistance in Obtaining Verifications
{¶ 23} In the third assignment of error, Communicare argues that the trial
court abused its discretion in affirming the administrative appeal decision because
“the agency failed to assist Mr. Fanous in obtaining verifications * * *.”
{¶ 24} We disagree. Because Fanous’ known countable resources caused
him to exceed the eligibility limit, the status of the incomplete verifications is moot.
In affirming the agency decision, the trial court found as much, stating that “[e]ven
if this court found * * * Fanous was entitled to assistance from ODJFS in responding
to the verification forms, Mr. Fanous still owns resources, in the form of real
property, that exceed the Medicaid eligibility limit.” We find no abuse of discretion.
{¶ 25} We overrule this assignment of error.
{¶ 26} Judgment affirmed.
It is ordered that appellee recover from appellant costs herein taxed.
The court finds there were reasonable grounds for this appeal.
It is ordered that a special mandate be sent to said court to carry this judgment
into execution.
A certified copy of this entry shall constitute the mandate pursuant to Rule 27
of the Rules of Appellate Procedure.
EILEEN A. GALLAGHER, JUDGE
SEAN C. GALLAGHER, P.J., and
LARRY A. JONES, SR., J., CONCUR
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IN THE COURT OF APPEALS OF THE STATE OF IDAHO
Docket No. 44487
STATE OF IDAHO, ) 2017 Unpublished Opinion No. 658
)
Plaintiff-Respondent, ) Filed: December 8, 2017
)
v. ) Karel A. Lehrman, Clerk
)
BARRYNGTON EUGENE SEARCY, ) THIS IS AN UNPUBLISHED
) OPINION AND SHALL NOT
Defendant-Appellant. ) BE CITED AS AUTHORITY
)
Appeal from the District Court of the Seventh Judicial District, State of Idaho,
Fremont County. Hon. Gregory W. Moeller, District Judge.
Order denying I.C.R. 35 motion, affirmed; order denying motion for court-
appointed counsel, affirmed.
Barryngton E. Searcy, Boise, pro se appellant.
Hon. Lawrence G. Wasden, Attorney General; Russell J. Spencer, Deputy
Attorney General, Boise, for respondent.
________________________________________________
GRATTON, Chief Judge
Barryngton Eugene Searcy appeals from the district court’s denial of his Idaho Criminal
Rule 35 motion and his motion for court-appointed counsel.
I.
FACTUAL AND PROCEDURAL BACKGROUND
In 1988, Searcy was found guilty by a jury of first degree murder and robbery. The
district court imposed a determinate life sentence without the possibility of parole for the murder
charge and a consecutive sentence of indeterminate life with ten years determinate for the
robbery charge. Additionally, Searcy received a ten-year enhancement for using a firearm
during the commission of those crimes. Thereafter, Searcy made three separate appeals, all of
1
which involve issues related to his sentencing. In Searcy’s first appeal 1 in 1990, he claimed
Idaho’s lack of an insanity defense violated his constitutional rights and that the court abused its
sentencing discretion. The Idaho Supreme Court affirmed his conviction and sentences for
murder and robbery but vacated the dual sentence enhancements for use of a firearm and
remanded to the district court on only one enhancement. In Searcy’s second appeal 2 in 1991, he
addressed the issue of a lack of an insanity defense and also asserted that his sentences were
cruel and unusual. This Court held the first issue was addressed in his prior appeal and the
second issue could have been raised in the first appeal, but was not. Therefore, we declined to
address the merits of the argument. In Searcy’s third appeal 3 in 1993, he asserted that he should
be resentenced since the court’s oral pronouncement of his corrected sentence prevailed over the
subsequent written sentence, and the firearm enhancement was improperly ordered as
determinate. This Court rejected his first argument and directed that the sentencing judge
modify his sentence so the enhancement associated with the robbery conviction was for an
indeterminate term of ten years and would be served as an extension of the indeterminate life
sentence imposed for the robbery conviction.
In 2016 Searcy filed a Rule 35 motion to correct an illegal sentence, a motion for court-
appointed counsel, and an I.C.R. 36 motion to correct the spelling of his name in the amended
judgment of conviction. The district court granted his Rule 36 motion; however, the court
denied his Rule 35 motion and his motion for court-appointed counsel. Searcy timely appeals.
II.
ANALYSIS
On appeal, Searcy asserts that his conviction and sentence are illegal and should be
vacated. Pursuant to Rule 35, the district court may correct an illegal sentence at any time. In an
appeal from the denial of a motion under Rule 35 to correct an illegal sentence, the question of
whether the sentence imposed is illegal is a question of law freely reviewable by the appellate
court. State v. Josephson, 124 Idaho 286, 287, 858 P.2d 825, 826 (Ct. App. 1993); State v.
Rodriguez, 119 Idaho 895, 897, 811 P.2d 505, 507 (Ct. App. 1991).
1
State v. Searcy, 118 Idaho 632, 798 P.2d 914 (1990).
2
State v. Searcy, 120 Idaho 882, 820 P.2d 1239 (Ct. App. 1991).
3
State v. Searcy, 124 Idaho 107, 856 P.2d 897 (Ct. App. 1993).
2
The district court correctly noted that Rule 35 is a narrow rule “intended to address the
nature of the sentence imposed, not the manner in which the trial was conducted.” The Idaho
Supreme Court has held that Rule 35 is:
not a vehicle designed to reexamine the facts underlying the case to determine
whether a sentence is illegal; rather, the rule only applies to a narrow category of
cases in which the sentence imposes a penalty that is simply not authorized by law
or where new evidence tends to show that the original sentence was excessive.
State v. Clements, 148 Idaho 82, 86, 218 P.3d 1143, 1147 (2009). Rule 35 inquiries must involve
only questions of law, and may not include significant factual determinations to resolve the
merits of a Rule 35 claim. State v. Wolfe, 158 Idaho 55, 65, 343 P.3d 497, 507 (2015).
Searcy did not provide the court with any new evidence; therefore, his only means for
relief is to show that the sentence imposed is not authorized by law. On review, we conclude
that Searcy’s challenge is a collateral attack on the underlying conviction and was beyond the
scope of a Rule 35 motion. See Hill v. United States, 368 U.S. 424, 430 (1962); Housley v. State,
119 Idaho 885, 889, 811 P.2d 495, 499 (Ct. App. 1991). All of his arguments relate to alleged
procedural and evidentiary defects during his trial and sentencing that are required to be raised
on direct appeal.
Searcy first argues the district court erred when not considering the merits of his claims
on the basis of res judicata. Res judicata prevents the litigation of causes of action which were
finally decided in a previous suit. Gubler By and Through Gubler v. Brydon, 125 Idaho 107,
110, 867 P.2d 981, 984 (1994). The review of a trial court’s ruling on whether an action is
barred by res judicata is a question of law over which this Court has de novo review. Ticor Title
Co. v. Stanion, 144 Idaho 119, 122, 157 P.2d 613, 616 (2007). The principles of res judicata
apply when a petitioner attempts to raise the same issues previously ruled upon on direct appeal
or in a subsequent petition for post-conviction relief. Knutsen v. State, 144 Idaho 433, 439, 163
P.3d 222, 228 (Ct. App. 2007). Additionally, res judicata bars claims in subsequent litigation
that should have been raised previously but were not. Aragon v. State, 114 Idaho 758, 766, 760
P.2d 1174, 1182 (1988).
Searcy bases his argument that the district court erred when it reasoned that Searcy “has
offered no explanation as to why these defects were not--or could not have been--asserted in any
of his three prior appeals” when denying his motion. While Searcy is correct that a Rule 35
motion may be brought at any time, he disregards the court’s next sentence explaining, “despite
3
his assertions to the contrary, Searcy’s motion fails to properly assert any claims establishing that
his sentence was ‘improper on its face,’ as Rule 35(a) clearly requires.” The issues raised by
Searcy are actually about his underlying conviction and the lawfulness of his conviction has been
raised and affirmed on prior appeals. Therefore, any current arguments related to his underlying
conviction, whether previously raised or not, are properly barred pursuant to res judicata. For
example, Searcy asserts his first degree murder conviction was obtained through an
unconstitutional presumption contained in the jury instructions. He also alleges the jury
determined the murder occurred in the course of the robbery, and therefore his consecutive
sentences for murder and robbery are illegal. These are challenges to his conviction, not an
attempt to correct a sentence that is illegal on its face. As noted above, Rule 35 inquiries may
not include significant factual determinations. Wolfe, 158 Idaho at 65, 343 P.3d at 507. Because
the resolution of these issues would require factual inquiries, they are not properly brought
pursuant to a Rule 35 motion. Likewise, Searcy’s argument that his determinate life sentence is
illegal because the district court failed to find certain aggravating factors before imposing the
sentence would also require factual inquiries and, thus, is not properly brought on a Rule 35
motion. Finally, Searcy asserted the sentence enhancement for use of a firearm was improperly
corrected in his absence. Because this argument addresses the procedural aspects of his
sentencing and not the imposition of an illegal sentence, it is also not properly brought pursuant
to a Rule 35 motion and was required to be made on direct appeal. Therefore, a Rule 35 motion
is not the correct mechanism to bring such claims and the district court and this Court lack
jurisdiction to consider the issues.
Searcy also asserts the district court erred when denying his motion for court-appointed
counsel. If a post-conviction petitioner is unable to pay for the expenses of representation, the
trial court may appoint counsel to represent the petitioner in preparing the petition in the trial
court and on appeal. I.C. § 19-4904. The decision to grant or deny a request for court-appointed
counsel lies within the discretion of the district court. Grant v. State, 156 Idaho 598, 603, 329
P.3d 380, 385 (Ct. App. 2014). When a district court is presented with a request for appointed
counsel, the court must address this request before ruling on the substantive issues in the case.
Id.; Fox v. State, 129 Idaho 881, 885, 934 P.2d 947, 951 (Ct. App. 1997). The district court
abuses its discretion where it fails to determine whether a petitioner for post-conviction relief is
4
entitled to court-appointed counsel before denying the petition on the merits. Grant, 156 Idaho
at 603, 329 P.3d at 385.
In determining whether to appoint counsel pursuant to I.C. § 19-4904, the district court
should determine if the petitioner is able to afford counsel and whether the situation is one in
which counsel should be appointed to assist the petitioner. Grant, 156 Idaho at 603, 329 P.3d at
385. In its analysis, the district court should consider that petitions filed by a pro se petitioner
may be conclusory and incomplete. Facts sufficient to state a claim may not be alleged because
they do not exist or because the pro se petitioner does not know the essential elements of a claim.
Id. Some claims are so patently frivolous that they could not be developed into viable claims
even with the assistance of counsel. Newman v. State, 140 Idaho 491, 493, 95 P.3d 642, 644 (Ct.
App. 2004). However, if a petitioner alleges facts that raise the possibility of a valid claim, the
district court should appoint counsel in order to give the petitioner an opportunity to work with
counsel and properly allege the necessary supporting facts. Grant, 156 Idaho at 603, 329 P.3d at
385.
The district court found Searcy met the indigency requirement for court-appointed
counsel. However, the reasons set forth above support the holding that the district court did not
abuse its discretion when denying Searcy’s motion for court-appointed counsel. The trial court
may deny a motion for appointed counsel in a Rule 35 proceeding if it finds that the motion “is
not a proceeding that a reasonable person with adequate means would be willing to bring at his
own expense and is therefore a frivolous proceeding.” State v. Wade, 125 Idaho 522, 523, 873
P.2d 167, 168 (Ct. App. 1994); see also I.C. § 19-852(b)(3). As noted, Searcy’s arguments relate
to alleged procedural and evidentiary defects and fail to allege that the sentence imposed is not
authorized by law. Because his challenges are a collateral attack on the underlying conviction
and beyond the scope of a Rule 35 motion, the threshold for denying court-appointed counsel at
this stage has been met.
This Court affirms the thorough and well-reasoned decision of the district court. It
correctly noted that, “as well briefed and clearly articulated as Searcy’s claims for relief under
Rule 35(a) may be, they are merely a reiteration of arguments that either were raised, or should
have been raised, in Searcy’s three earlier appeals.” Additionally, the district court did not abuse
its discretion when denying Searcy’s motion for court-appointed counsel.
5
III.
CONCLUSION
This Court affirms the district court’s denial of Searcy’s Rule 35 motion because his
challenge is a collateral attack on the underlying conviction and beyond the scope of a Rule 35
motion. We also affirm the district court’s denial of court-appointed counsel because no
reasonable person with adequate means would be willing to pay an attorney to bring such an
action.
Judge GUTIERREZ and Judge HUSKEY CONCUR.
6
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 02-4143
KOREY TELEMUS JEFFERY,
Defendant-Appellant.
Appeal from the United States District Court
for the District of South Carolina, at Florence.
C. Weston Houck, District Judge.
(CR-00-613)
Submitted: June 25, 2002
Decided: July 29, 2002
Before WIDENER, LUTTIG, and TRAXLER, Circuit Judges.
Affirmed by unpublished per curiam opinion.
COUNSEL
William F. Nettles, IV, Assistant Federal Public Defender, Florence,
South Carolina, for Appellant. J. Strom Thurmond, Jr., United States
Attorney, Alfred W. Bethea, Jr., Assistant United States Attorney,
Florence, South Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
2 UNITED STATES v. JEFFERY
OPINION
PER CURIAM:
Korey Telemus Jeffery pled guilty to one count of unlawful posses-
sion of a firearm by a convicted felon, in violation of 18 U.S.C.A.
§ 922(g)(1) (West 2000). Based on prior convictions, including a
1998 South Carolina conviction for failure to stop for a blue light, the
district court sentenced Jeffery as an armed career criminal under 18
U.S.C.A. § 924(e) (West 2000). The court also granted the govern-
ment’s motion for downward departure and sentenced Jeffery to 120
months in prison. Without armed career criminal status, Jeffery’s sen-
tence would have been substantially lower. Jeffery challenges his sen-
tence, contending that his conviction for failure to stop for a blue light
did not constitute a predicate offense for the sentencing enhancement
provision of the armed career criminal statute.
Under 18 U.S.C.A. § 922(g)(1), it is unlawful for a convicted felon
to possess a firearm. An individual who violates § 922(g) faces a
minimum fifteen year sentence if he has three prior convictions for
violent felonies or serious drug offenses. 18 U.S.C. § 924(e). To con-
stitute a crime of violence for purposes of armed career criminal
offender status, the potential for injury is determinative. The court
must focus on the fact of conviction and the statutory definition of the
crime, rather than on the underlying facts of a particular conviction.
Taylor v. United States, 495 U.S. 575, 600-01 (1990); United States
v. Coleman, 158 F.3d 199, 201-02 (4th Cir. 1998) (en banc). The risk
for injury has been found to be sufficiently high to qualify convictions
as crimes of violence in the case of escape, United States v. Hairston,
71 F.3d 115, 117 (4th Cir. 1995), burglary, Taylor, 495 U.S. at 597-
98, and pickpocketing, United States v. Mobley, 40 F.3d 688, 696 (4th
Cir. 1994). We find that the potential for violence that could result
from the failure to stop for a blue light and the potential ensuing con-
frontation between a police officer and the driver is analogous to
potential for violence from these other crimes.
Consequently, we affirm Jeffery’s conviction and sentence. We
dispense with oral argument because the facts and legal contentions
are adequately presented in the materials before the court and argu-
ment would not aid the decisional process.
AFFIRMED
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575 F.2d 1340
Dornv.U. S. Civil Service Comm.
No. 77-1293
United States Court of Appeals, Seventh Circuit
3/1/78
1
N.D.Ill.
AFFIRMED
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Filed 9/15/14 Darryl B. v. Superior Court CA5
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
FIFTH APPELLATE DISTRICT
DARRYL B.,
F069592
Petitioner,
(Super. Ct. No. 06CEJ300105-2)
v.
THE SUPERIOR COURT OF FRESNO OPINION
COUNTY,
Respondent;
FRESNO COUNTY DEPARTMENT OF
SOCIAL SERVICES,
Real Party in Interest.
THE COURT*
ORIGINAL PROCEEDINGS; petition for extraordinary writ review. Mary Dolas,
Temporary Judge. (Pursuant to Cal. Const., art. VI, § 21.)
Katherine Fogarty, for Petitioner.
No appearance for Respondent.
Daniel Cederborg, County Counsel, and Amy K. Cobb, Deputy County Counsel,
for Real Party in Interest.
-ooOoo-
* Before Levy, Acting P.J., Kane, J. and Peña, J.
Darryl B. (father) seeks extraordinary writ review of the juvenile court’s orders
denying him reunification services under Welfare and Institutions Code section 361.21
and setting a section 366.26 hearing as to his four-year-old daughter, Jazmine. We grant
the petition.
PROCEDURAL AND FACTUAL SUMMARY
Father and Angelina (mother) are Jazmine’s parents. Mother is schizophrenic and
she and father engage in domestic violence and abuse alcohol and marijuana. Mother has
a long association with child protective services dating back to 1996, involving multiple
children.
The Fresno County Department of Social Services (department) first intervened on
Jazmine’s behalf in November 2010, after mother and father left then one-year-old
Jazmine unattended, got drunk and broke a window. The department returned Jazmine to
their custody after they agreed to participate in community-based services.
In December 2011, the juvenile court sustained a first amended dependency
petition alleging mother and father physically and verbally abused each other in
Jazmine’s presence, placing her at a substantial risk of suffering serious physical or
emotional harm. The juvenile court removed Jazmine from father’s custody and ordered
reunification services for him. The juvenile court allowed Jazmine to stay in mother’s
custody with family maintenance services. In January 2012, father was arrested on
federal weapons charges. In October 2012, the juvenile court granted mother sole legal
and physical custody of Jazmine and terminated its dependency jurisdiction.
These dependency proceedings were initiated in February 2014, after law
enforcement arrested mother for being under the influence of crystal methamphetamine.
At the time, father was incarcerated in Illinois State Prison.
1 All further statutory references are to the Welfare and Institutions Code unless
otherwise indicated.
2
The department filed a dependency petition on Jazmine’s behalf, asking the
juvenile court to detain her from mother and exercise its dependency jurisdiction over
her. The juvenile court detained Jazmine, adjudged her its dependent, and the department
placed her in foster care.
In its report for the dispositional hearing, the department recommended the
juvenile court deny both parents reunification services. Specifically, as to father, the
department recommended the juvenile court deny him placement under section 361.2,
subdivision (a) and reunification services under section 361.5, subdivision (b)(10).2
Father’s trial counsel filed a motion arguing subdivision (b)(10) did not apply to father’s
case because Jazmine was not a “sibling” as defined in the statute.
In June 2014, the juvenile court conducted a contested dispositional hearing.
Father argued through counsel that he wanted to obtain custody of Jazmine upon his
release and that he should receive reunification services.
The juvenile court denied mother reunification services on the grounds
recommended by the department but found that section 361.5, subdivision (b)(10) did not
apply to father. The court then set a section 366.26 hearing.
When father and mother’s attorneys asked for clarification, the juvenile court
explained that it was denying father both placement and reunification services under
section 361.2. The court stated:
“Well, he’s … noncustodial and … I said that neither placement nor
services be provided under [section] 361.2. What I said was inapplicable
2 Section 361.5, subdivision (b)(10) authorizes the juvenile court to deny a parent
reunification services if it finds by clear and convincing evidence that “the court ordered
termination of reunification services for any siblings or half siblings of the child because
the parent … failed to reunify with the sibling or half sibling after the sibling or half
sibling had been removed from that parent … pursuant to Section 361 and that parent …
is the same parent … described in subdivision (a) and that, according to the findings of
the court, this parent … has not subsequently made a reasonable effort to treat the
problems that led to removal of the sibling or half sibling of that child from that
parent .…” (§ 361.5, subd. (b)(10).)
3
was the analysis under section 361.5[, subdivision] (b)(10) in that they keep
saying that he should be denied based on not reunifying with the sibling
and factually that’s incorrect. [¶] … [¶]
“I’m making a ruling in regards to [section] 361.2 that there’s
detriment to place and there’s detriment to provide him any further services
given the information that’s provided.”
This petition ensued.
DISCUSSION
Father contends the juvenile court erred in denying him reunification services
under section 361.2. We agree.
Section 361.2 protects the custody rights of a noncustodial parent when the
juvenile court removes the child from the custodial parent in order to protect the child. In
essence, it requires the juvenile court to place the child with the noncustodial parent
unless doing so would be detrimental to the child. Specifically, section 361.2,
subdivision (a) states:
“When a court orders removal of a child pursuant to Section 361, the
court shall first determine whether there is a parent of the child, with whom
the child was not residing at the time that the events or conditions arose that
brought the child within the provisions of Section 300, who desires to
assume custody of the child. If that parent requests custody, the court shall
place the child with the parent unless it finds that placement with that
parent would be detrimental to the safety, protection, or physical or
emotional well-being of the child.”
If the juvenile court determines it would be detrimental to place the child with the
noncustodial parent, the juvenile court must order reunification services unless one of the
statutory exceptions in section 361.5, subdivision (b) applies. The exceptions apply to
custodial and noncustodial parents. (In re Adrianna P. (2008) 166 Cal.App.4th 44, 59.)
Thus, section 361.2 addresses placement of a child with a noncustodial parent.
Section 361.5, subdivision (b) authorizes the denial of reunification services to a
custodial or noncustodial parent if one of the exceptions applies.
4
In this case, after determining that subdivision (b)(10) of section 361.5 did not
apply to father, the juvenile court found it would be detrimental to Jazmine to provide
father reunification services and erroneously believed section 361.2 authorized it to deny
him services. Since the juvenile court lacked a statutory basis for denying father
reunification services, it also lacked authority to set a section 366.26 hearing.
Real party in interest concedes error and requests that we direct the juvenile court
to conduct a new dispositional hearing.
DISPOSITION
Let an extraordinary writ issue directing respondent court to vacate its orders
issued on June 11, 2014, denying father reunification services pursuant to Welfare and
Institutions Code section 361.2, and setting a Welfare and Institutions Code section
366.26 hearing. Respondent court is further directed to conduct a new dispositional
hearing, and after taking into consideration any new evidence or change in circumstances,
make any appropriate orders. This opinion is final forthwith as to this court.
5
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Case: 11-50016 Document: 00511527609 Page: 1 Date Filed: 07/01/2011
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
July 1, 2011
No. 11-50016 Lyle W. Cayce
Summary Calendar Clerk
TERESA KAY THOMPSON,
Plaintiff-Appellant
v.
SOMERVELL COUNTY, TEXAS,
Defendant-Appellee
Appeal from the United States District Court
for the Western District of Texas
USDC No. 6:10-CV-62
Before HIGGINBOTHAM, SMITH, and HAYNES, Circuit Judges.
PER CURIAM:*
Plaintiff Teresa Thompson (“Thompson”) appeals from the district court’s
grant of summary judgment to Defendant Somervell County (“Somervell County”
or “County”). Because Thompson failed to establish a prima facie case of Title
VII retaliation, we AFFIRM the judgment of the district court.
*
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: 11-50016 Document: 00511527609 Page: 2 Date Filed: 07/01/2011
No. 11-50016
I. Background
Thompson began employment with Somervell County in May 1995 and
became an Assistant County Auditor the next year. In August 2005 she alleged
that Darrell Morrison (“Morrison”), the County Auditor, had sexually harassed
her. Although Thompson filed a written report with Ken Thrasher (“Thrasher”),
the County’s Personnel Director, she ultimately decided not to pursue her
complaint after Morrison apologized to her and signed a statement to that effect.
Although she alleges that she continued to feel uncomfortable working with
Morrison, Thompson remained at the County Auditor’s office for three more
years without incident.
In 2008, Thompson transferred to the Somervell County Expo Center.
Thompson does not deny that she struggled with her responsibilities in this new
position. She had difficulties keeping the bank account balanced and failed to
keep a deposit ledger as she had been instructed. Her supervisor at the Expo
Center, Mike Dooley (“Dooley”), discussed these problems with her, but he did
not discipline her. However, due to her difficulties at the Expo Center,
Thompson began looking for other positions. On May 4, 2009, Thompson asked
Thrasher for her personnel file, including the written report of her sexual
harassment complaint. Thompson told Thrasher that she “was going to do
whatever it took to make this right.” Thompson testified that she wanted the
paperwork “to explain why [she] had to take [the Expo Center] job. [She] simply
wanted to find a job in the County for which [she] was better suited.” She
received the personnel file on May 11.
On May 18, 2009, Dooley reprimanded Thompson for her poor work quality
for the first time. The next day, he sent her a Work Deficiencies Memorandum
(“Memorandum”), detailing her errors in drafting contracts and balancing the
bank account. The letter stated that “[t]here are several deficiencies in
2
Case: 11-50016 Document: 00511527609 Page: 3 Date Filed: 07/01/2011
No. 11-50016
[Thompson’s] work that must be corrected” and that Thompson could not “hold
[the] position if the errors are not corrected.”
After receiving the Memorandum, Thompson continued to submit
contracts with substantive errors. In one contract, Thompson failed to verify the
dates for shows and rehearsals as directed. As a result, all twenty dates in the
contract were wrong. Dooley directed Thompson to have co-worker Abe Comacho
help her, but when Dooley discussed the matter with Comacho, Comacho
indicated that Thompson had not sought his assistance. On June 1, 2009,
Dooley told Thompson that she would have to resign by the end of the next day
or she would be terminated. Thompson did not resign, and Dooley fired her as
indicated.
Thompson claims that her relationship with Dooley became less warm and
more professional after she requested her paperwork. She also claims that
during this time, when discussing an incident in which a patron of an Expo
Center event was injured, Dooley opined that an employee would be more likely
than an outsider to sue the County.
Thompson brought suit against Somervell County alleging that she was
fired in retaliation for requesting the documentation of her sexual harassment
report from 2005. After discovery, the County filed a motion for summary
judgment, arguing that Thompson had not engaged in a protected activity and
that there was no evidence of a causal link between her request and her
termination. The district court granted the County’s motion, and Thompson
timely appealed.
II. Analysis
This court reviews a district court’s grant of summary judgment de novo,
applying the same standard as the district court. Brumfield v. Hollins, 551 F.3d
322, 326 (5th Cir. 2008). Summary judgment is appropriate where the evidence
3
Case: 11-50016 Document: 00511527609 Page: 4 Date Filed: 07/01/2011
No. 11-50016
demonstrates that there is no genuine issue of material fact and the moving
party is entitled to judgment as a matter of law. Id.
Thompson’s suit alleges that Somervell County retaliated against her for
engaging in activity protected by Title VII. See 42 U.S.C. § 2000e-3(a).
Specifically, Thompson alleges that the County fired her because she asked for
the paperwork detailing Morrison’s sexual harassment toward her. Where a
plaintiff alleges unlawful retaliation in violation of Title VII, the court employs
the burden-shifting analysis the McDonnell Douglas1 burden-shifting
framework. See Long v. Eastfield College, 88 F.3d 300, 304 (5th Cir. 1996).
Under the first step of the McDonnell Douglas framework, the plaintiff
must make a prima facie case of discrimination. See Turner v. Baylor
Richardson Med. Ctr., 476 F.3d 337, 348 (5th Cir. 2007). To make a prima facie
case of retaliation, Thompson “must demonstrate that: (1) she engaged in
protected activity; (2) an adverse employment action occurred; and (3) a causal
link exists between the protected activity and the adverse employment action.”
Id. The district court determined that Thompson had failed to make a prima
facie case of retaliation under Title VII because she failed to establish that she
had engaged in protected activity or that there was a causal connection between
her termination and her claimed protected activity.
A. Protected Activity
“An employee has engaged in protected activity when she has (1) ‘opposed
any practice made an unlawful employment practice’ by Title VII or (2) ‘made a
charge, testified, assisted, or participated in any manner in an investigation,
1
McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802-04 (1973). Under the McDonnell
Douglas framework, an employee must first establish a prima facie case of retaliation.
Hockman v. Westward Commc’ns., LLC, 407 F.3d 317, 330 (5th Cir. 2004). If successful, then
the employer must demonstrate a legitimate, nonretaliatory reason for the adverse
employment action. Id. If the employer meets this burden, the burden then shifts to the
employee to show that the employer’s stated rationale is pretextual and that engaging in the
protected activity was the but-for cause of the adverse employment action. Id.
4
Case: 11-50016 Document: 00511527609 Page: 5 Date Filed: 07/01/2011
No. 11-50016
proceeding, or hearing’ under Title VII.” Douglas v. DynMcDermott Petroleum
Operations Co., 144 F.3d 364, 372 (5th Cir. 1998) (internal citations omitted).
As noted by the Supreme Court, “oppose” is undefined by Title VII and therefore
“carries its ordinary meaning.” Crawford v. Metro. Gov’t of Nashville &
Davidson Cnty., Tenn., 129 S. Ct. 846, 850 (2009). Though the Court rejected a
definition of “oppose” that requires the opposition to be “active [and] consistent,”
id. at 851, it is clear that opposition nonetheless must be purposive. See id.
(“[W]e would call it ‘opposition’ if an employee took a stand against an employer’s
discriminatory practices not by ‘instigating’ action, but by standing pat, say, by
refusing to follow a supervisor’s order to fire a junior worker for discriminatory
reasons.”) (emphasis added); id. at 853 (Alito, J., concurring) (“The primary
definitions of the term ‘oppose’ . . . require conduct that is . . . purposive.”).
In this case, Thompson emphasizes that, when requesting the
documentation of her sexual harassment report from four years earlier, she told
Thrasher that she “was going to do whatever it took to make this right,” arguing
that this constituted an “opposition” statement. See id. at 851 (“When an
employee communicates to her employer a belief that the employer has engaged
in . . . a form of employment discrimination, that communication virtually
always constitutes the employee’s opposition to the activity.” (internal quotation
marks and citation omitted) (alteration in original)). We conclude that the
district court did not err in finding this statement insufficient to qualify as
“opposition” given that Thompson’s admitted reason for requesting the
documentation was because she “simply wanted to find a job in the County for
which [she] was better suited.” This stated reason is also consistent with the
timing of the request, having been made nearly four years after the incident at
issue and more than three years after she signed a “no action” letter. Because
Thompson admits that her sole intent in requesting the documentation of her
sexual harassment complaint was to find another position within the County, no
5
Case: 11-50016 Document: 00511527609 Page: 6 Date Filed: 07/01/2011
No. 11-50016
reasonable jury could find that the request was made with intent “to contend
against[,] confront[,] resist [or] withstand” any long ago discriminatory practices
by the County or its officials. See id. at 850 (quoting WEBSTER’S NEW
INTERNATIONAL DICTIONARY 1710 (2d ed. 1958)); cf. Payne v. McLemore’s
Wholesale & Retail Stores, 654 F.2d 1130, 1136-37 (5th Cir. 1981) (affirming
district court’s finding of opposition where there was “substantial evidence . . .
that the purpose of the boycott and picketing was to opposed defendant’s
discrimination against blacks in certain employment opportunities”). Therefore,
Thompson’s request did not constitute opposition to an unlawful practice under
Title VII.
B. Causal Link
Thompson also failed to establish the third prong of a prima facie
retaliation case, a causal link between the alleged protected activity and the
adverse employment action. To establish the causal link between her request
for the sexual harassment documentation and her termination, Thompson relies
exclusively on the fact that she received the Memorandum within one week of
requesting the report and was terminated within one month of requesting the
report. However, even at the prima facie stage, temporal proximity can only
establish a causal link when it is connected to the decision maker’s knowledge
of the protected activity. See Clark Cnty. Sch. Dist. v. Breeden, 532 U.S. 268, 273
(2001) (per curiam) (“The cases that accept mere temporal proximity between an
employer’s knowledge of protected activity and an adverse employment action as
sufficient evidence of causality to establish a prima facie case uniformly hold
that the temporal proximity must be very close.” (emphasis added) (internal
quotation marks and citation omitted)); Cothran v. Potter, 398 F. App’x 71, 73-74
(5th Cir. 2010) (unpublished) (“The combination of temporal proximity and
knowledge of a protected activity may be sufficient to satisfy a plaintiff’s prima
facie burden for a retaliation claim”); Ramirez v. Gonzalez, 225 F. App’x 203, 210
6
Case: 11-50016 Document: 00511527609 Page: 7 Date Filed: 07/01/2011
No. 11-50016
(5th Cir. 2007) (unpublished) (“Fifth Circuit precedent requires evidence of
knowledge of the protected activity on the part of the decision maker and
temporal proximity between the protected activity and the adverse employment
action.”); see also Brungart v. BellSouth Telecomms., Inc., 231 F.3d 791, 799
(11th Cir. 2000) (“[T]emporal proximity alone is insufficient to create a genuine
issue of fact as to causal connection where there is unrebutted evidence that the
decision maker did not have knowledge that the employee engaged in protected
conduct.”).
In this case, Dooley testified that he was unaware that Thompson had
requested documentation of her sexual harassment report at the time that he
fired her, and his testimony is uncontroverted on this matter. Indeed, Thompson
admits that she has no evidence that Dooley knew that she had requested her
documentation other than to rely on the inference of temporal proximity.
Therefore, even if we were to assume that Thompson’s request for
documentation of her prior sexual harassment report constituted a protected
activity, Thompson has failed to establish even a prima facie causal link between
her request and her termination.
III. Conclusion
For the above reasons, we AFFIRM the district court’s summary judgment.
7
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965 F.2d 34
23 Fed.R.Serv.3d 126
ALLIED ELEVATOR, INC., Tom E. Cobb, Betty M. Pierce,Individually and as Independent Executrix of theEstate of Bobby G. Pierce deceased,Plaintiffs-Appellants,v.EAST TEXAS STATE BANK OF BUNA, Texas, Credit Guard LifeInsurance Co., Defendants-Appellees.
No. 91-4434.
United States Court of Appeals,Fifth Circuit.
July 13, 1992.
Robert N. Brailas, J. Christopher Reynolds, Gibbs & Ratliff, Houston, Tex., for plaintiffs-appellants.
Robert Keith Wade, Wade & Gilmore, Beaumont, Tex., for F.D.I.C.
Robert J. Vander Lyn, Brockman, Coffey & Vander Lyn, Houston, Tex., for defendants-appellees.
Appeal from the United States District Court For the Eastern District of Texas.
Before DAVIS, JONES, and E. GARZA, Circuit Judges.
W. EUGENE DAVIS, Circuit Judge:
1
Appellants appeal the summary judgment the district court granted to the FDIC in its effort to collect on a note. We conclude that summary judgment was inappropriate because two issues of material fact were presented. We therefore reverse and remand.
I.
2
On February 11, 1985, Allied Elevator, Inc. (Allied) and its owner, Bobby G. Pierce, borrowed $50,000 from East Texas State Bank of Buna, Texas (Bank) and gave the Bank a promissory note in return (the Original Note). Allied and Pierce subsequently renewed the note five times, the fifth time on May 18, 1986.
3
During the term of the May 18 note, Pierce sold his Allied stock to Tom E. Cobb and Gary Stark. On November 18, 1986, the maturity date of the May 18 note, Pierce, Cobb, and Allied signed a new note for $50,000 (the Renewal Note). Pierce also initialed a request on the face of the note for credit life insurance. The premium for the credit life insurance was capitalized, raising the amount financed by the Renewal Note to $50,123.26.
4
Pierce died in January 1987, during the term of the Renewal Note. When the Renewal Note matured on February 17, 1987, no one paid the Bank. The Bank subsequently sent past-due notices to Allied. Allied refused to pay.
5
Allied, Cobb, and Betty Pierce, the executrix of Pierce's estate, brought suit in state court against the Bank and Credit Guard Life Insurance Co. (Credit Guard). The plaintiffs alleged that defendants had breached an agreement to provide credit life insurance and had otherwise demonstrated a lack of good faith and fair dealing. The Bank counterclaimed, seeking judgment on the Original Note against Allied and Pierce's estate.
6
In November 1988, the Bank failed and the Federal Deposit Insurance Corporation (FDIC) was appointed receiver. The FDIC removed the case to federal court1 and moved for summary judgment on all claims involving the Bank, including the counterclaim. The district court granted the FDIC's motion on February 4, 1991, ordering that the plaintiffs take nothing on their claims against the FDIC and awarding the FDIC $50,000 in principal, $10,094.29 in prejudgment interest, and $19,616.44 in attorney's fees on its counterclaim. The court denied Allied and Cobb's consolidated Motion to Reconsider or Motion for New Trial on March 19, 1991. In response to an alleged error in the March 19 order, the district court issued another order on April 25, clarifying that the February 4 summary judgment in favor of the FDIC was controlling. Meanwhile, on April 11, 1991, the district court granted the FDIC's motion to sever its judgment on the counterclaim. Appellants filed their notice of appeal on May 24, 1991.
II.
7
We first address our jurisdiction. The district court granted the FDIC's motion for summary judgment on February 4, 1991. This order resolved (1) the FDIC's counterclaim against Allied and Pierce's estate, and (2) plaintiffs' claims against the FDIC, but did not resolve (3) plaintiffs' claims against Credit Guard. Accordingly, the February 4 order did not dispose of all claims in the suit and was not a final judgment under Fed.R.Civ.P. 54. The FDIC, presumably recognizing that the February 4 order was non-appealable, moved on March 26, 1991 to sever its judgment on the counterclaim. The district court granted this motion on April 11, 1991, ordering that judgment on the counterclaim "is hereby severed, for which let execution issue."
8
Rule 21 of the Federal Rules of Civil Procedure provides that "[a]ny claim against a party may be severed and proceeded with separately." Fed.R.Civ.P. 21. "Severance under Rule 21 creates two separate actions or suits where previously there was but one. Where a single claim is severed out of a suit, it proceeds as a discrete, independent action, and a court may render a final, appealable judgment in either one of the resulting two actions notwithstanding the continued existence of unresolved claims in the other." United States v. O'Neil, 709 F.2d 361, 368 (5th Cir.1983). Although the district court did not explicitly refer to Rule 21, we conclude that the district court clearly intended to sever the judgment on the counterclaim. Id.
9
When the district court granted the motion to sever on April 11, the judgment on the counterclaim became final and appealable. Appellants filed their notice of appeal on May 24, well within the 60-day time limit applicable to cases involving an agency of the United States under Fed.R.App.P. 4(a)(1). See Rauscher Pierce Refsnes, Inc. v. FDIC, 789 F.2d 313 (5th Cir.1986) (FDIC is federal agency for purpose of Fed.R.Civ.P. 12(a)); Godwin v. FSLIC, 806 F.2d 1290, 1292 & n. 5 (5th Cir.1987) (FSLIC is federal agency under Fed.R.App.P. 4(a)). Thus we have jurisdiction over this appeal, and now proceed to the merits.III.
10
Summary judgment is appropriate if the record discloses "that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). We review the grant of summary judgment de novo and "review the evidence and inferences to be drawn therefrom in the light most favorable to the non-moving party." FDIC v. Laguarta, 939 F.2d 1231, 1236 (5th Cir.1991) (citations omitted).
A.
11
Appellants maintain that it was error for the district court to rely on any note other than the Renewal Note as evidence of the debt owed the Bank. This is important because Pierce's request for credit life insurance is made only on the Renewal Note. The FDIC contends that it had the right to sue under the Original Note.2 We conclude that there is an issue of material fact as to which note(s) evidence(s) the indebtedness.
12
Both parties agree that there is an outstanding debt and that this indebtedness has been evidenced by a sequence of promissory notes. Appellants maintain that each renewal of the note evidencing the debt canceled the preceding note; the FDIC argues contra. In Texas it is
13
well settled that the giving of a new note for a debt evidenced by a former note does not extinguish the old note unless such is the intention of the parties. Nor is there a presumption of the extinguishment of the original paper by the execution and delivery of a new note. The burden of proving a novation is on the person asserting it. Chapman v. Crichet, 127 Tex. 590, 95 S.W.2d 360, 363 (1936).
14
When renewal notes are involved, the holder may sue either on the original note or on the renewal note.
15
Villarreal v. Laredo Nat'l Bank, 677 S.W.2d 600, 607 (Tex.App.--San Antonio 1984, writ denied n.r.e.) (citations omitted).
16
The Renewal Note, then, will be considered a novation, accord, satisfaction, modification, or payment of the previous notes only if appellants can show that that was the intention of the parties. Otherwise, the FDIC is free to sue on any of the notes given the Bank, including the Original Note. Appellants raise several facts to support their contention that the parties intended the Renewal Note to novate the preceding notes. We find two particularly interesting. First, appellants claim that the previous notes are stamped "CANCELLED BY RENEWAL." Second, on April 6, 1987, the Bank sent appellants a past-due notice for a note due February 17, 1987; the only note due February 17, 1987 is the Renewal Note. This evidence alone is enough to create a material issue of fact as to the parties' intent, and renders summary judgment for the FDIC inappropriate at this time. Barnett v. Petro-Tex Chemical Corp., 893 F.2d 800, 810 (5th Cir.), cert. denied, --- U.S. ----, 110 S.Ct. 3274, 111 L.Ed.2d 784 (1990); Charles Alan Wright, Arthur R. Miller, and Mary Kay Kane, 10A Federal Practice and Procedure § 2730 at 236-65, § 2730.1 at 265 (West, 2d ed. 1983); Clark v. Pecos County State Bank, 147 S.W.2d 917, 919 (Tex.App.--El Paso 1941). We therefore remand for further factual development on the parties' intent.3B.
17
The second question of fact concerns the request for credit life insurance on the face of the Renewal Note. The request was initialed "BGP" (Bobby G. Pierce) and the premium of $123.26 was capitalized. Credit Guard has refused all requests to pay the note. Appellants have sued Credit Guard over this refusal, but that claim is not part of this appeal. Appellants contend that the Bank was obligated to procure credit life insurance as requested. Appellants contend further that if the Bank failed to procure insurance, this breach relieves them of their obligation to pay the note. Thus appellants assert, as a defense to the FDIC's counterclaim, that the Bank breached a material provision in the note.
18
"A fundamental rule of contract law is that whenever a party to a contract ... commits a material breach, the other party to that contract, at its election, is excused from further performance." Bernal v. Garrison, 818 S.W.2d 79, 83 (Tex.App.--Corpus Christi 1991, writ denied). Thus, if the credit life provision is a material term of the Renewal Note and the Bank is found to have breached that term, then appellants are excused from paying the amount due under the note. The district court did not consider whether the credit life provision is a material term of the Renewal Note, and neither party has briefed that issue. Accordingly, summary judgment was inappropriate and we remand for further factual development on this issue.
19
The FDIC suggests that a remand is unnecessary because the credit life provision is unenforceable. The FDIC makes two arguments in support of this suggestion, neither of which has merit. First, the FDIC characterizes appellants' claim of credit life insurance as involving an oral agreement and thus barred by D'Oench, Duhme & Co. v. FDIC, 315 U.S. 447, 62 S.Ct. 676, 86 L.Ed. 956 (1942). We disagree with the FDIC's characterization. The credit life provision in question is not oral; it is written on the face of the Renewal Note. Thus D'Oench, Duhme is inapplicable. The FDIC next refers to an alleged oral side agreement between the Bank, Allied, Cobb, and Pierce to the effect that Pierce did not actually want credit life insurance. In other words, the FDIC wishes to invoke D'Oench, Duhme to enforce this oral side agreement. The FDIC provides no authority for the novel proposition that it is entitled to rely on oral side agreements it feels protects a failed bank's depositors and creditors. Contrary to the FDIC's belief, its "special role is not all-empowering." Matter of Still, 963 F.2d 75, 78 (5th Cir.1992).
IV.
20
Because we conclude that material questions of fact persist (1) as to which promissory note(s) evidence(s) appellants' indebtedness, and (2) whether the credit life provision of the November 18, 1986 note is a material term and whether it was breached, we REVERSE the district court's award of summary judgment in favor of the FDIC on its counterclaim to collect on the February 15, 1985 note and REMAND to the district court for further proceedings consistent with this opinion.
21
REVERSED AND REMANDED.
1
The FDIC substituted as party in its receivership capacity in defending against plaintiffs' claims, but in its corporate capacity in its counterclaim against appellants
2
Appellants contend that the FDIC never offered summary judgment evidence to support a claim that it is the receiver of the Bank, the liquidator of its assets, or the current holder of their promissory note. We disagree. The Bank sued to collect on the Original Note and attached a copy of that note to its First Amended Counterclaim. When the FDIC moved to substitute parties in November 1988, it alleged that it is "now the owner and holder of the note which is the subject of this suit." Appellants did not contest this motion. Then, in its motion for summary judgment on the counterclaim, the FDIC alleged that the note and accompanying affidavit attached to the counterclaim "are hereby referred to and made a part hereof as if fully copied herein haec verba." Appellants now challenge the FDIC's custody and interest in the note, but offer no evidence to support this challenge. We conclude that the summary judgment evidence establishes without dispute that the FDIC is the holder of the promissory notes at issue
3
If the district court determines on remand that the FDIC is entitled to sue on the Original Note, we do not consider whether appellants can still rely on the credit life provision contained in the Renewal Note as a supplement to the terms of the Original Note
| {
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Supreme Court
No. 2012-157-M.P.
(PC 04-3025)
(PC 04-3026)
Theodore J. Fabrizio, Jr. :
v. :
City of Providence, et al. :
Stephen J. Deninno :
v. :
City of Providence, et al. :
NOTICE: This opinion is subject to formal revision before
publication in the Rhode Island Reporter. Readers are requested to
notify the Opinion Analyst, Supreme Court of Rhode Island, 250
Benefit Street, Providence, Rhode Island 02903, at Telephone 222-
3258 of any typographical or other formal errors in order that
corrections may be made before the opinion is published.
Supreme Court
No. 2012-157-M.P.
(PC 04-3025)
(PC 04-3026)
Theodore J. Fabrizio, Jr. :
v. :
City of Providence, et al. :
Stephen J. Deninno :
v. :
City of Providence, et al. :
Present: Suttell, C.J., Goldberg, Flaherty, Robinson, and Indeglia, JJ.
OPINION
Justice Robinson, for the Court. The petitioners, former Providence Mayor Vincent A.
Cianci, Jr. and former Chief of the Providence Fire Department James Rattigan, seek review on
certiorari of an order by the Superior Court denying without prejudice their motion for summary
judgment.1 The underlying dispute arose after the respondents, Theodore J. Fabrizio, Jr. and
Stephen J. Deninno, two Providence firefighters, objected to orders from their superiors that they
serve as part of the crew of a fire engine in the 2001 Pride Parade.2 Following their unwilling
1
Although both Vincent A. Cianci, Jr., and James F. Rattigan do not presently hold their
former offices as Mayor and Fire Chief, for the sake of narrative clarity we shall hereinafter refer
to them simply by the titles which they held at the time of the 2001 Pride Parade that gave rise to
the instant jarndycean piece of litigation.
2
The Rhode Island Pride Commission, the Pride Parade’s sponsor, is a nonprofit
organization the goal of which is “celebrating the pride and diversity of the lesbian, gay,
bisexual, and transgendered community of Rhode Island and southern New England.” About Us,
RHODE ISLAND PRIDE, http://www.prideri.com/ (last visited December 19, 2014).
-1-
participation in the parade, the respondents sued the petitioners, as well as the City of
Providence, on a variety of state and federal claims. Mayor Cianci and Chief Rattigan moved for
summary judgment on two of those claims (viz., Counts Six and Seven; see infra), invoking the
venerable doctrine of qualified immunity from suit.3 After entertaining argument in open court,
the hearing justice opined that further development of the pertinent facts was warranted;
accordingly, he denied the motion for summary judgment, but he specifically stated that the
denial was without prejudice.
For the reasons set forth below, we quash the judgment of the Superior Court and remand
with instructions that petitioners’ motion for summary judgment be granted.
I
Facts and Travel4
In 2001, Mr. Fabrizio and Mr. Deninno were employed by the Providence Fire
Department, Mr. Fabrizio as a firefighter and Mr. Deninno as a captain. Both men served in
Engine Company No. 7, a company based at the North Main Street Fire Station. On June 15,
2001, Engine Company No. 7 received a work assignment to drive a fire truck in the 2001 Pride
Parade the next day. Nothing in the record indicates that assignments of this type were at all
uncommon.5 It is further uncontested in the record that Engine Company No. 7 was the engine
3
Regrettably, the papers containing petitioners’ motion for summary judgment and the
accompanying memorandum of law are missing from the record before us. Nonetheless, we
have been able to glean from the extant record the essence of their argument.
4
There is no material dispute with respect to the facts that we have summarized in the text.
5
Chief Rattigan testified in his deposition that fire engine companies had also received
orders to participate in parades for other organizations; and the record indicates that the Fire
Department used an official “Request for a Fire Company” form for the 2001 Pride Parade.
-2-
company chosen to carry out the 2001 Pride Parade assignment due to its proximity to the parade
route, in accordance with the practice of Chief Rattigan.
Mr. Fabrizio and Mr. Deninno self-identify as members of the Roman Catholic Church,
and they contend that their beliefs as Catholics do not allow them to “support, encourage, nor
condone homosexual behavior.” When these two firefighters learned of their company’s
assignment, they objected to participating in the parade on the basis of their religious beliefs,
expressing their discomfort to the district chief. Notwithstanding the objections of Mr. Fabrizio
and Mr. Deninno, Chief Rattigan reiterated his order that they carry out the task assigned. (Mr.
Fabrizio and Mr. Deninno also alleged that they were told by others associated with the Fire
Department that the order to participate in the parade came directly from Mayor Cianci.) The
next day, Mr. Fabrizio and Mr. Deninno reluctantly were part of the crew of Engine Company
No. 7 as it took part in the parade pursuant to the June 15, 2001 order. Both firefighters alleged
that it was their conviction that to do otherwise would jeopardize their employment status within
the Fire Department.
Mr. Fabrizio and Mr. Deninno further alleged that, while the parade was ongoing, they
experienced sexual harassment, including being subjected to sexual propositions and other
offensive remarks. Mr. Fabrizio and Mr. Deninno also claimed that the harassment did not end
with the work assignment; they averred that, after their assignment to the parade, they suffered
additional sexual harassment at the hands of their coworkers and also received at least sixty
profanity-laced anonymous phone calls. Mr. Fabrizio and Mr. Deninno alleged that, despite
participating in meetings with the City’s Equal Employment Opportunity Officer, filing formal
grievances with their union, and lodging complaints with “upper-level management,” their
complaints went unresolved.
-3-
In June of 2004, Mr. Fabrizio and Mr. Deninno filed nearly identical complaints in the
Superior Court for Providence County against several defendants––Mayor Cianci, individually
and in his official capacity; Chief Rattigan, individually and in his official capacity; and the City
of Providence, by and through its treasurer, Stephen Napolitano. The only counts in their
complaints that are relevant to this appeal are Count Six (alleging deprivation of the right of
freedom of religion under the Rhode Island Constitution) and Count Seven (alleging deprivation
of the rights of freedom of speech and association under the Rhode Island Constitution).6 Mr.
Fabrizio and Mr. Deninno sought several forms of relief, including declaratory and injunctive
relief as well as compensatory and punitive damages.
In January of 2012, petitioners, Mayor Cianci and Chief Rattigan, moved for summary
judgment on Counts Six and Seven on the basis of qualified immunity.7 The two officials argued
that respondents had no clearly established right to “refuse to complete a legitimate work
6
All other counts in the complaint were disposed of in favor of Mayor Cianci and Chief
Rattigan during earlier stages of the litigation for reasons that are not presently relevant. The
original nine counts were as follows: (1) Count One, alleging employment discrimination in
violation of the federal Civil Rights Act; (2) Count Two, alleging unlawful discrimination in
violation of the state Fair Employment Practices Act; (3) Count Three, alleging unlawful
discrimination in violation of the state Civil Rights Act; (4) Count Four, alleging a deprivation of
the right to freedom of religion under federal law; (5) Count Five, alleging a deprivation of the
right to freedom of speech and association under federal law; (6) Count Six, alleging deprivation
of the right of freedom of religion in violation of the Rhode Island Constitution; (7) Count
Seven, alleging deprivation of the right of freedom of speech and association in violation of the
Rhode Island Constitution; (8) Count Eight, alleging intentional infliction of emotional distress;
and (9) Count Nine, alleging negligent infliction of emotional distress.
7
Through its ten long years of travel, this case has been removed to federal court, has been
remanded by that court, and has survived several dispositive motions in state court––including a
partial motion for summary judgment by respondents, a motion for summary judgment on the
merits by petitioners, and a motion to dismiss by petitioners. Somewhere along the way, the
parties managed to undertake a great deal of discovery; among those whose depositions were
taken were Mr. Fabrizio, Mr. Deninno, and Chief Rattigan.
-4-
assignment”––i.e., to refuse to man a fire truck in a parade because of personal moral objections
to the task. The respondents vociferously disagreed, arguing in their objection to the motion for
summary judgment (1) that qualified immunity was no bar to any injunctive or declaratory relief
in their favor; and (2) that, more importantly, in view of what they contended was the applicable
test for constitutional violations of the rights of government employees, petitioners could not
show that they were qualifiedly immune from suit. After considering the arguments of the
respective parties, the hearing justice rendered a bench decision denying the motion. While the
hearing justice noted that this Court had alluded to the possible applicability of the doctrine of
qualified immunity in earlier cases such as Ensey v. Culhane, 727 A.2d 687 (R.I. 1999) and
Pontbriand v. Sundlun, 699 A.2d 856 (R.I. 1997), he did not pass upon the applicability of that
doctrine in this case; it was his view that the facts had not yet been sufficiently developed for
him to be able to grant petitioners’ motion for summary judgment. Accordingly, the hearing
justice denied the motion—albeit without prejudice. Mayor Cianci and Chief Rattigan
subsequently filed a petition for review on writ of certiorari. We granted the petition and stayed
further Superior Court proceedings pending our review of the matter.
II
Standard of Review
As a general rule, this Court will not review the denial of a motion for summary
judgment, since such an order constitutes an interlocutory decision; and, under our precedent, the
non-prevailing party is not entitled to an appeal of right. National Refrigeration, Inc. v. Capital
Properties, Inc., 88 A.3d 1150, 1154 (R.I. 2014). However, even though a direct appeal is not
available, a non-prevailing party may petition for certiorari with respect to an otherwise
nonappealable order. See Fayle v. Traudt, 813 A.2d 58, 61 (R.I. 2003). On occasion, we have
-5-
granted a writ of certiorari following a denial of a motion for summary judgment where no
genuine issues of material fact are in dispute, and both parties present purely legal arguments.
See, e.g., Henderson v. Nationwide Insurance Co., 35 A.3d 902, 905 (R.I. 2012). Our review on
certiorari is confined to determining whether an error of law has occurred. Woodruff v. Gitlow,
91 A.3d 805, 809 (R.I. 2014).
We review the denial of a motion for summary judgment de novo, and we use “the same
standard of review that applies to a grant of summary judgment.” Woodruff, 91 A.3d at 809
(internal quotation marks omitted); see also National Refrigeration, Inc., 88 A.3d at 1154;
Employers Mutual Casualty Co. v. Arbella Protection Insurance Co., 24 A.3d 544, 553 (R.I.
2011). This standard requires us to view the record in the light most favorable to the nonmoving
party; and, if we conclude that a genuine issue of material fact exists or that the moving party is
not entitled to judgment as a matter of law, we must affirm the denial of summary judgment. See
Woodruff, 91 A.3d at 810; see also Morales v. Town of Johnston, 895 A.2d 721, 726-27 (R.I.
2006). See generally Estate of Giuliano v. Giuliano, 949 A.2d 386, 390-91 (R.I. 2008).
III
Analysis
Although petitioners argue that the doctrine of qualified immunity protects them from
liability, we have stated that “[g]overnment officials need not avail themselves of the protections
of qualified immunity when no constitutional violation is present.” Monahan v. Girouard, 911
A.2d 666, 673-74 (R.I. 2006). Accordingly, we conclude that, in view of the facts of this
specific case, it is not necessary to invoke the doctrine of qualified immunity because no
constitutional violation occurred.
-6-
Here, respondents received an order to participate in the parade because their engine
company was assigned to the task; it is uncontested that such orders were common, as evidenced
by Chief Rattigan’s reference to receiving “numerous” requests from parade organizers for Fire
Department participation and as reflected in the standard form for such requests used by the
Department. After receiving this work assignment from their employer (the regularity of which
has not been questioned), respondents participated in the parade merely as relatively anonymous
public servants. We are unaware of any pertinent legal authority in support of the proposition
that, in such specific circumstances, employees’ rights are violated if they happen to possess
religious objections to the beliefs of the group with which an otherwise legitimate work
assignment requires brief interaction. See generally Mendoza Toro v. Gil, 110 F. Supp. 2d 28,
35 (D.P.R. 2000) (stating that the plaintiff’s beliefs “[did] not relieve her of her professional
obligation to complete legitimate work assignments” and further stating that the plaintiff did not
“have a First Amendment right to pick and choose work assignments that suit[ed] her moral
beliefs”).
The respondents’ appearance in the parade, solely as members of the Providence Fire
Department, did not constitute a form of expression on their part. Rather, it was simply the
accomplishing of a task assigned to an engine company of the Providence Fire Department, and
the individuals chosen to carry out that assignment cannot be said to have engaged in personal
speech by carrying out their work as public servants. See generally Hennessy v. City of
Melrose, 194 F.3d 237, 245, 246 (1st Cir. 1999) (noting that plaintiffs who allege that they have
been discharged for exercising First Amendment rights must show they have engaged in
constitutionally protected speech—that is, “commenting upon matters of public concern”)
(internal quotation marks omitted).
-7-
As we noted in Monahan, “the first step in evaluating a claim to qualified immunity is to
determine whether the plaintiff has alleged the deprivation of an actual constitutional right at all
* * *.” Monahan, 911 A.2d at 674 (internal quotation marks omitted). The respondents’
participation in the parade as public servants carrying out a legitimate work assignment was not a
deprivation of their constitutional rights. Therefore, as in Monahan, since there was no
deprivation of a constitutional right, our analysis rightly can come to an abrupt halt since “the
need for [invocation of the doctrine of qualified immunity] no longer exists.” Id.
IV
Conclusion
For the reasons set forth herein, the petition for certiorari is granted, and the judgment of
the Superior Court is quashed. The papers in the case are remanded to the Superior Court with
our opinion endorsed thereon for entry of judgment on Counts Six and Seven in accordance with
this opinion.
-8-
RHODE ISLAND SUPREME COURT CLERK’S OFFICE
Clerk’s Office Order/Opinion Cover Sheet
TITLE OF CASE: Theodore J. Fabrizio, Jr. v. City of Providence, et al.
Stephen J. Deninno v. City of Providence, et al.
CASE NO: No. 2012-157-M.P.
(PC 04-3025)
(PC 04-3026)
COURT: Supreme Court
DATE OPINION FILED: December 19, 2014
JUSTICES: Suttell, C.J., Goldberg, Flaherty, Robinson, and Indeglia, JJ.
WRITTEN BY: Associate Justice William P. Robinson III
SOURCE OF APPEAL: Providence County Superior Court
JUDGE FROM LOWER COURT:
Associate Justice Brian Van Couyghen
ATTORNEYS ON APPEAL:
For Petitioners: Kevin F. McHugh, Esq.
For Respondents: Gina A. DiCenso, Esq.
| {
"pile_set_name": "FreeLaw"
} |
Filed 10/25/18 (unmodified opn. attached)
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION THREE
UBER TECHNOLOGIES, INC.
Plaintiff and Respondent, A153653
v. (City & County of San Francisco
GOOGLE LLC, Super. Ct. No. CPF-17-515960)
Defendant and Appellant. ORDER MODIFYING OPINION;
NO CHANGE IN JUDGMENT
BY THE COURT:
It is ordered that the opinion filed herein on September 28, 2018, be modified as
follows:
On page 15, in the paragraph commencing with the words “Next, Uber claims,”
the three consecutive sentences beginning with “The record shows” and ending with
“scope of the indemnified claims” are deleted. The following sentence is inserted in its
place: “The record shows Diligenced Employees were required to cooperate and make
their devices available to Stroz as a pre-condition to the execution of the Put Call
Agreement and as a means to determine the scope of the indemnified claims.”
The petition for rehearing filed October 15, 2018, is denied. There is no change in
the judgment.
Date: October 25, 2018 ____SIGGINS, P.J. _____P.J.
1
Trial Court: City & County of San Francisco Superior Court
Trial Judge: Honorable Harold E. Kahn
Counsel:
Keker, Van Nest & Peters, Robert A. Van Nest, Dan Jackson, Jo W. Golub, W. Hamilton
Jordan, Rachel E. Meny, Thomas E. Gorman for Defendant and Appellant.
Boies Schiller Flexner, Meredith R. Dearborn, Juan P. Valdivieso, Hamish Hume, Jessica
Phillips for Plaintiff and Respondent.
Goodwin Procter, Andrew S. Ong for Real Party in Interest, Andrew Levandowski.
Taylor & Patchen, Karen S. Dhadialla for Real Party in Interest, Lior Ron.
2
Filed 9/28/18 (unmodified version)
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FIRST APPELLATE DISTRICT
DIVISION THREE
UBER TECHNOLOGIES, INC.,
Plaintiff and Respondent,
A153653
v.
GOOGLE LLC, (REDACTED)
Defendant and Appellant.
Anthony Levandowski and Lior Ron are former Google LLC (Google) employees
who started the self-driving vehicle company Ottomotto LLC (Otto). Google considered
Otto a competitor to its own self-driving vehicle project. After Otto was acquired by
Uber Technologies, Inc. (Uber), Google initiated arbitration proceedings against its two
former employees for allegedly breaching their employment contracts, breaching their
fiduciary duties, fraud, tortious interference with Google’s employment relationships, and
other claims. Google sought discovery from Uber, a nonparty to the arbitration, related
to pre-acquisition due diligence done at the request of Uber and Otto’s outside counsel by
Stroz Friedberg LLC. Over Uber’s objections, the arbitration panel determined the due
diligence documents were not protected by either the attorney client privilege or the
attorney work product doctrine and ordered them produced. Uber initiated a special
proceeding in superior court seeking to vacate the arbitration panel’s discovery order and
prevailed.
Google now appeals from the superior court’s order. We deny Uber’s motion to
dismiss the appeal because the superior court’s order determined all the pending issues in
the special proceeding between Google and Uber and was thus a final appealable order.
Further, the due diligence-related documents prepared by Stroz were not protected
1
attorney-client communications. Neither were they entitled to absolute protection from
disclosure under the attorney work product doctrine. Although the materials had
qualified protection as work product, denial of the materials would unfairly prejudice
Google’s preparation of its claims. The superior court order is reversed.
BACKGROUND
Levandowski and Ron started working at Google in 2007. Both resigned from
Google in January 2016. After leaving, they formed Otto, a self-driving technology
company which Google considered a competitor of its own self-driving car project. In
August 2016, Otto was acquired by Uber. In October 2016, Google initiated arbitration
proceedings against Levandowski and Ron for allegedly breaching non-solicitation and
non-competition agreements. The arbitration between Google and Levandownski and
Ron was scheduled to commence on April 30, 2018.
DISCUSSION
I. Appealability of Superior Court’s Discovery Order
In July 2017, Google issued a third-party subpoena in the arbitration proceedings,
demanding that Uber produce documents related to pre-acquisition due diligence
conducted by the investigative firm Stroz Friedberg LLC (Stroz). Google sought all
documents related to Stroz’s investigation into Levandowski, Ron, and Otto, including a
report Stroz prepared at the request of counsel. Uber objected and refused to produce the
documents, asserting they were protected under the attorney-client privilege and as
attorney work product.
In September 2017, Google moved in the arbitration to compel production of the
Stroz documents. The arbitration panel chair found these Stroz-related materials (“Stroz
Materials”) were not privileged or attorney work product. Uber appealed to the full
arbitration panel which summarily affirmed the chair’s order.
Uber petitioned the San Francisco Superior Court to vacate the panel’s discovery
order. The superior court granted Uber’s petition and vacated the arbitration panel’s
decision, requiring Uber to produce the documents (the “Order” or “Discovery Order”).
2
On January 22, 2018, Google filed this appeal, asserting the Order was a final
appealable “order vacating an [arbitration] award.” Days later, in an effort “to accelerate
adjudication of the issues raised by Google’s appeal,” Google petitioned for a writ of
mandate, prohibition, and/or other appropriate relief (Case No. A153457), asking this
Court to direct the superior court to vacate the Order. This court summarily denied the
writ.
In February 2018, Uber moved to dismiss this appeal on the ground that we lack
jurisdiction. Following oral argument on Uber’s motion, we deferred a decision on the
motion to dismiss until we considered the appeal on its merits.1
Uber contends this court lacks jurisdiction over Google’s appeal because the trial
court’s Discovery Order was not a final arbitration award and thus not appealable.
Google argues the Order was final, conclusive, and appealable as “[a]n order vacating an
award” under Code of Civil Procedure section 1294, subdivision (c).2
Section 1294 governs the right to appeal from trial court orders in arbitration
matters. It provides that “ ‘[a]n aggrieved party may appeal from: [¶] (a) An order
dismissing or denying a petition to compel arbitration. [¶] (b) An order dismissing a
petition to confirm, correct or vacate an award. [¶] (c) An order vacating an award unless
a rehearing in arbitration is ordered. [¶] (d) A judgment entered pursuant to this title. [¶]
(e) A special order after final judgment.’ ” (Vivid Video, Inc. v. Playboy Entertainment
Group, Inc. (2007) 147 Cal.App.4th 434, 442 (Vivid Video).)
“ ‘ “[N]o appeal can be taken except from an appealable order or judgment, as
defined in the statutes and developed by the case law.” ’ [Citation.]” (City of Gardena v.
Rikuo Corp. (2011) 192 Cal.App.4th 595, 601.) “The existence of an appealable order or
judgment is a jurisdictional prerequisite to an appeal.” (Canandaigua Wine Co., Inc. v.
County of Madera (2009) 177 Cal.App.4th 298, 302 (Canandaigua).)
1
We ordered Google’s writ petition in A153457 be deemed the opening brief in
this appeal and that the record in A153457 serve as the record in this case.
2
All statutory references are to the Code of Civil Procedure unless otherwise
indicated.
3
“[Code of Civil Procedure] Section 904.1, subdivision (a), governs the right to
appeal in civil actions. It codifies the ‘one final judgment rule,’ which provides that
‘ “ ‘an appeal may be taken only from the final judgment in an entire action.’ ”
[Citation.]’ [Citation.] A judgment is final, and therefore appealable, when it embodies
‘the final determination of the rights of the parties in an action or proceeding’ (§ 577). A
judgment constitutes the final determination of the parties’ rights ‘ “where no issue is left
for future consideration except the fact of compliance or noncompliance with [its]
terms . . . .” [Citation.]’ [Citation.]” (Kaiser Foundation Health Plan, Inc. v. Superior
Court (2017) 13 Cal.App.5th 1125, 1138 (Kaiser Foundation).) “The one final judgment
rule is a ‘fundamental principle of appellate practice that prohibits review of intermediate
rulings by appeal until final resolution of the case.’ [Citation.] ‘[A]n appeal cannot be
taken from a judgment that fails to complete the disposition of all causes of action
between the parties. . . .’ ” (C3 Entertainment, Inc. v. Arthur J. Gallagher & Co. (2005)
125 Cal.App.4th 1022, 1025.) “ ‘[E]xceptions to the one final judgment rule should not
be allowed unless clearly mandated.’ ” (In re Baycol Cases I & II (2011) 51 Cal.4th 751,
757.) “[I]f the order or judgment is not appealable, the appeal must be dismissed.”
(Canandaigua, supra, 177 Cal.App.4th at p. 302.)
We know of no case that addresses the precise issue before us, namely, whether a
party to an arbitration has a right to appeal an adverse superior court order vacating an
arbitrator’s discovery order in favor of a third party to the arbitration.
Our Supreme Court’s decision in Berglund v. Arthroscopic & Laser Surgery
Center of San Diego, L.P. (2008) 44 Cal.4th 528 (Berglund) provided the superior court
jurisdiction to consider Uber’s petition to vacate the discovery order in the underlying
arbitration. There, a nonparty to an arbitration proceeding was ordered by the arbitrator
to produce documents. (Id. at p. 533.) The nonparty moved for a protective order in the
superior court, which the superior court denied because it believed it lacked jurisdiction
to review an arbitrator’s discovery order. (Ibid.) The nonparty appealed. (Ibid.) The
Supreme Court acknowledged that discovery disputes between parties to an arbitration
agreement are “ ‘generally immune from judicial review.’ ” (Id. at p. 534.) The Court
4
explained that parties to an arbitration agreement knowingly accept the limited judicial
review of an arbitrator’s decisions and the risk that an arbitrator might make a mistake.
(Ibid.) However, nonparties, who did not consent to any arbitration agreement, “cannot
be compelled to arbitrate a dispute.” (Id. at p. 536.) Absent such consent, the Court
concluded that nonparties were entitled to full judicial review of any adverse discovery
order issued by the arbitrator against them. (Id. at pp. 537-538.) This result was
necessary to preserve the legal rights of nonparties who never agreed to the arbitration in
the first place. (Id. at p. 538.) While Berglund established that a nonparty dissatisfied
with an arbitrator’s discovery decision may seek full judicial review in the superior court,
it did not determine whether a party to the arbitration dissatisfied with the superior court
decision then has a right of direct appeal.
On this issue unaddressed by Berglund, we conclude such a right of direct appeal
exists based on the one final judgment rule. Here, the Discovery Order was the final
resolution of the special proceeding initiated by Uber for the sole purpose of vacating the
arbitration panel’s order compelling Uber to produce the Stroz Materials. The superior
court’s order resolved the dispute between Uber and Google with finality. In vacating the
arbitration panel’s award, the court’s order relieved Uber of any obligation to produce the
Stroz Materials in the underlying arbitration and conclusively determined Uber’s
obligations to Google. There was nothing left for the superior court to determine as
between Uber and Google, and the Order disposed of all issues between them in the
special proceeding. Since the Order was “the final determination of the rights of the
parties” (§ 577), it is appealable.
The Discovery Order also had the finality required under section 1294. “Under
section 1294, appealable arbitration orders require finality. . . . ‘[T]he Legislature’s
philosophy and intent in drafting section 1294 was that there should be no appellate
consideration of intermediate rulings in arbitration disputes if the superior court was of
the view that there should be initial or further proceedings in arbitration. . . .’ An
intermediate ruling in an arbitration dispute that contemplates further proceedings in
arbitration is not appealable. [Citations.] Requiring finality in appealable arbitration
5
orders is consistent both with the language of section 1294 and the general prohibition of
appeals from interlocutory nonfinal judgments in section 904.1, subdivision (a).
[Citations.]” (Vivid Video, supra, 147 Cal.App.4th at pp. 442–443.) The Discovery
Order contemplated no further proceedings between Google and Uber. It completely
resolved the parties’ dispute as Uber was not a party to the arbitration.
Finally, even though the case did not arise out of an arbitration proceeding, City of
Woodlake v. Tulare County Grand Jury (2011) 197 Cal.App.4th 1293 (Woodlake),
underscores our conclusion. There, the appellant sought review of an order denying
enforcement of an investigative subpoena “in which enforcement or nonenforcement was
the only issue before the superior court.” (Id. at p. 1299.) The court noted that
“ ‘[g]enerally, discovery orders are not appealable’ ” but found that “ ‘generalization is
inapplicable’ ” when “ ‘the order is ancillary to litigation in another jurisdiction and
operates as the last word by a California trial court on the matters at issue.’ ” (Ibid.) The
Woodlake court observed that the respondent did not contend that its petition remained
pending. (Ibid.) Nor did the respondent contend “further proceedings are contemplated
in the trial court, the traditional criterion for finality of an order.” (Ibid.) The court
concluded that the trial court’s order terminated the entire proceeding on the merits and
was appealable as a final judgment. (Ibid.) Such is the case here.
Uber contends the Discovery Order is not a final award because it “did not dispose
of any of the claims to be tried in the arbitration.” According to Uber, “[t]he only thing
the Order did is protect Uber . . . from having to produce privileged and work-product
protected material from discovery in the Arbitration.” Uber is correct that the trial
court’s Order decided only a preliminary discovery dispute in the arbitration. However,
Uber was not a party to the arbitration, and the Order determined the entire controversy
between Uber and Google in the special proceeding. As Uber itself cites, the “one final
judgment rule” requires that a judgment is appealable when it embodies “the final
determination of the rights of the parties in an action or proceeding.” (§ 577, italics
added.)
6
At oral argument on the motion to dismiss, Uber argued the Order lacked finality
for other reasons. Uber explained that after a final award on the merits in the underlying
arbitration, Google would be able to petition the superior court to confirm, vacate, or
modify the award, and could appeal that result if so inclined. Uber emphasized the
Discovery Order eventually could be reviewed in such a direct appeal by Google. We do
not dispute Google’s ability to appeal from a judgment confirming an adverse arbitration
award. However, Google’s right to eventually appeal an adverse judgment from its
arbitration with Levandowski and Ron does not render the Discovery Order intermediate
or incomplete in the dispute between Uber and Google. Nor does it deprive Google of its
ability to appeal a final judgment in a fully adjudicated special proceeding.
The two principle cases Uber relies upon do not compel a different result. In
Judge v. Nijjar Realty, Inc. (2014) 232 Cal.App.4th 619 (Judge), the arbitrator issued a
“partial final award” which concluded that an agreement permitted arbitration of the
plaintiff’s class action claims. (Id. at p. 627.) The defendants petitioned the trial court to
vacate the arbitrator’s award. (Ibid.) The trial court did so, ruling the arbitrator exceeded
her powers by deciding the arbitrability of the class claims, and the plaintiff appealed.
(Id. at pp. 627-628.) The appellate court recognized an order vacating an award in the
absence of a rehearing was appealable under section 1294, subdivision (c), but
determined the trial court’s order did not vacate an “award” within the meaning of the
statute. (Id. at pp. 633-634.) The Judge court explained that “an arbitration award must
‘include a determination of all the questions submitted to the arbitrators the decision of
which is necessary to determine the controversy.’ ” (Id. at p. 633.) The order contested
in Judge did not resolve the arbitration but decided only, as a threshold matter, that class
claims were subject to arbitration. (Id. at p. 638.) Judge held the order vacating the class
arbitrability determination was not an appealable final award and dismissed the appeal.
(Id. at pp. 632, 638.)
In Kaiser Foundation, supra, 13 Cal.App.5th.1125, Kaiser moved an arbitration
panel to dismiss claims brought by several hospitals for Kaiser’s alleged failure to
reimburse them for medical services provided to its members. (Id. at p. 1130.) The
7
arbitration panel denied the motion, and Kaiser petitioned the trial court to vacate the
award. (Ibid.) After the trial court denied the petition and entered judgment confirming
the award, Kaiser appealed. (Ibid.) However, the appellate court determined the award
was not appealable. (Id. at pp. 1144, 1146.) Citing to Judge, the Kaiser Foundation
court explained that the partial final award “did not ‘determin[e] . . . all the questions
submitted to the arbitrators the decision of which is necessary to determine the
controversy’ [citation].” (Id. at pp. 1143-1144.) The court noted that “[t]he controversy
between Kaiser and [the hospitals] encompasse[d] a wide range of questions” but the
partial final award determined “the sole question” of whether the plaintiffs’ claims were
preempted and subject to certain exhaustion requirements. (Id. at p. 1144.) According to
the court, “[t]he partial final award did not resolve all of the other questions necessary to
determine the parties’ controversy” which had yet to be ruled upon and were pending
before the arbitration panel. (Ibid.)
Both cases are distinguishable. First of all, the orders appealed in both Judge and
Kaiser involved disputes between the parties to the underlying arbitration agreement. In
both cases, additional controversies between the parties remained, and the parties would
continue to resolve those in arbitration. In contrast, this case involved a nonparty to the
underlying arbitration, and the single dispute involving the nonparty was conclusively
determined by the superior court. Judge and Kaiser Foundation do not apply.
Because the Discovery Order is a final determination of the discovery rights
between Uber and Google in the special proceeding commenced for the sole purpose of
resolving this discovery dispute, the order is appealable. Uber’s motion to dismiss is
denied, and we proceed to consider the merits of the appeal.
II. The Stroz Materials
On February 22, 2016, Uber and Otto signed a term sheet for Uber’s acquisition of
Otto.3 The term sheet established a process for Uber to potentially acquire 100%
3
Many of the documents pertaining to that agreement have been filed under seal,
but some of the details in the agreements are otherwise already in the public record. At
oral argument, the court requested the parties to identify the specific factual material in
8
ownership of Otto through the execution of a Put Call Agreement. An “Indemnity
Construct” agreement was part of the term sheet and provided that Uber would indemnify
Levandowski and Ron from certain claims Google might assert against them post-
acquisition. These included claims for the infringement or misappropriation of any
intellectual property; breach of fiduciary duty to their former employer; and breach of
any non-solicitation, non-competition, or confidentiality agreement.
To determine the scope of the indemnified claims, the Indemnity Construct
contained a “Pre-Signing Due Diligence Process.” An “Outside Expert” was to
investigate certain Otto “Diligenced Employees,” including Levandowski and Ron. The
Outside Expert was to prepare a “third party report,” which the term sheet defined as “the
written report(s) . . . summarizing in detail all of the facts, circumstances, activities or
events obtained by the Outside Expert from any Diligenced Employee that the Outside
Expert deems are reasonably related to any Bad Act of such Diligenced Employee, in
each case, based on the interviews, forensic due diligence and other due diligence
investigation with respect to all Diligenced Employees conducted by the Outside Expert.”
“Bad Acts” covered any infringement or misappropriation of trade secrets, breach of
fiduciary duty, and violation of any non-solicitation, non-competition, or confidentiality
agreement committed by an employee.
Stroz, an independent third party and digital forensic expert, was the Outside
Expert tasked with performing the pre-signing due diligence and was to be “jointly
directed by and engaged by” Uber and Otto. Stroz was jointly retained in an engagement
letter dated March 4, 2016, by Uber’s outside counsel at Morrison Foerster (MoFo) and
Otto’s outside counsel at O’Melveny & Myers (O’Melveny). Their engagement letter
with Stroz states: “The purpose of the investigation is to ascertain facts that, in the
opinion of [MoFo and O’Melveny], bear on issues of whether certain current or
the record each party believes must remain sealed. Based on the parties’ responses to that
request and in light of the facts and documents that are otherwise already known to be in
the public record, we have redacted portions of this opinion where necessary to protect
information under seal not already in the public domain.
9
prospective employees . . . of Ottomotto have improperly retained on devices or in
storage repositories not belonging to former employers, confidential information
belonging to former employers, and whether such current or prospective employees
breached any fiduciary duty, duty of loyalty, or other confidentiality, non-solicitation,
non-competition or other obligations based in contract, statute or otherwise.”
During the pre-acquisition due diligence, Levandowski was represented by
Donahue Fitzgerald LLP’s John Gardner. Ron was personally represented by Levine &
Baker, LLP. Neither retained Stroz on behalf of their clients.
In and around March 2016, Stroz began its investigation under MoFo’s and
O’Melveny’s supervision and direction. Stroz collected from Levandowski and Ron
various electronic devices and access to various cloud-based storage accounts. In
addition, Stroz interviewed Levandowski and Ron.
Sometime in April 2016, Stroz gave Uber’s counsel at MoFo an oral report on its
preliminary fact finding and memos of interviews with Levandowski and Ron.
On April 11, 2016, Uber and Otto executed the Put Call Agreement and finalized
the indemnification agreement.
That same day, Otto, Levandowski, Ron, and Uber through their respective
counsel executed a “Joint Defense, Common Interest, and Confidentiality Agreement”
“in contemplation of potential investigations, litigation, and/or other proceedings” related
to Uber’s acquisition of Otto. Uber claims that the parties had an oral joint defense and
common interest agreement as of February 24, 2016.
On August 5, 2016, Stroz issued its final, written report to Uber’s MoFo attorneys
and Otto’s O’Melveny attorneys. That report is labeled “Privileged & Confidential [¶]
Attorney Work Product.”
On February 23, 2017, with Google’s arbitration pending against Levandowski
and Ron for the alleged breach of their employment contracts, Google filed a related civil
action, Waymo LLC v. Uber Technologies, Inc., Case No 3:17-cv-00939-WHA in the
United States District Court for the Northern District of California (the “Federal Case”).
In this Federal Case, Waymo, the Google-related self-driving car company, sought
10
damages and injunctive relief against Uber based on alleged trade secret misappropriation
arising out of Uber’s acquisition of Otto.
Waymo moved to compel production of the Stroz report and its exhibits. In June
2017, the magistrate judge granted Waymo’s motion. The magistrate held the Stroz
documents were not protected by Levandowski’s attorney-client privilege because the
“record is clear that Uber and Otto alone engaged Stroz to conduct the due diligence
required by the Term Sheet.” Nor were the documents protected by Uber’s attorney
client privilege because Stroz interviewed Levandowski and Ron in their individual
capacities, not as Otto executives. The magistrate also found the Stroz report was not
protected attorney work product, and not protected under the common interest doctrine.
Over the objections of Uber, Otto, and Levandowski, the district court affirmed the
magistrate’s order. Levandowski unsuccessfully sought mandamus relief in the Federal
Circuit. (See Waymo LLC v. Uber Techs., Inc. (Fed. Cir. Sept. 13, 2007) 870 F.3d 1350.)
In October 2017, Uber released the Stroz report.
As the Federal Case proceeded, the arbitration between Google and Levandowski
and Ron moved forward. Like Waymo did in the Federal Case, Google sought and
moved to compel production of the Stroz-related documents in the arbitration. The
arbitration panel chair found these Stroz Materials were protected by neither the attorney-
client privilege nor attorney work product doctrine. Uber appealed to the full arbitration
panel which summarily affirmed the chair.
Then, Uber successfully petitioned the San Francisco Superior Court to vacate the
panel’s order. The superior court held the Stroz Materials were protected under the
attorney client privilege, and it was not waived when the documents were shared between
Uber, Otto, Levandowski, Ron, and their respective attorneys. The superior court granted
Uber’s petition and vacated the arbitration panel’s decision compelling Uber to produce
the documents.
On January 22, 2018, Google appealed from the Order. We now address it on the
merits.
A. Applicable Standards of Review
11
The parties disagree on the standard of review we must apply on appeal and the
standard the superior court should have applied in reviewing the arbitration panel’s order.
Google relies on Advanced Micro Devices, Inc. v. Intel Corp. (1994) 9 Cal. 4th
362 (Advanced) to contend we must review the superior court’s order de novo. Uber
argues Advanced says nothing about our standard of review of a court’s order vacating an
arbitrator’s order compelling discovery from a nonparty. It views this case as analogous
to a petition for review of an interlocutory order, citing Costco Wholesale Corp. v.
Superior Court (2009) 47 Cal.4th 725, 733 (Costco), and submits our review should be
for abuse of discretion.
De novo review is proper here. As we have discussed above, this is a final order
that conclusively resolved the dispute between Uber and Google. Thus, we decline to
employ a review standard more appropriately applied to interlocutory orders, as Uber
urges. Appellate courts review superior court orders vacating a final arbitration award de
novo. (See Malek v. Blue Cross of California (2004) 121 Cal.App.4th 44, 55-56 (Malek);
Reed v. Mutual Service Corp. (2003) 106 Cal.App.4th 1359, 1364-1365.) We see no
reason to use a different standard. In addition, to the extent that the superior court’s
ruling rests upon a determination of disputed factual issues, we review them for
substantial evidence. (Malek, supra, 121 Cal.App.4th at pp. 55-56; Reed, supra, 1106
Cal.App.4th at p. 1365.)
When it comes to the standard of review applied by the superior court to the
arbitration panel’s order, the parties not unexpectedly flip positions. Google contends the
superior court erroneously applied the de novo standard and disregarded the arbitration
panel’s findings of fact. Google asserts the superior court should have applied the
deferential abuse of discretion standard. Uber argues the superior court properly applied
the de novo standard. We do not reach this issue because under either standard the
superior court erred in vacating the arbitration panel’s decision.
B. Attorney-Client Privilege
Under California law, an attorney-client communication is one “between a client
and his or her lawyer in the course of that relationship and in confidence.” (Evid. Code,
12
§ 952.) An attorney-client relationship exists when the parties satisfy the definitions of
“lawyer” and “client” as specified in Evidence Code sections 950 and 951, respectively.
For purposes of the attorney-client privilege, “client” is defined in relevant part as “a
person who, directly or through an authorized representative, consults a lawyer for the
purpose of retaining the lawyer or securing legal service or advice from him in his
professional capacity . . . .” (Evid. Code, § 951, italics added.) “Confidential
communication” protected by the privilege refers to “information transmitted between a
client and his or her lawyer in the course of that relationship and in confidence” by
confidential means. (Evid. Code, § 952.) A confidential communication may include “a
legal opinion formed and the advice given by the lawyer in the course of that
relationship.” (City of Petaluma v. Superior Court (2016) 248 Cal.App.4th 1023, 1032.)
The attorney client privilege may also extend to third parties who have been
engaged to assist the attorney in providing legal advice. (See State Farm Fire &
Casualty Co. v. Superior Court (1997) 54 Cal.App.4th 625, 639 (State Farm) [“ ‘It is no
less the client’s communication to the attorney when it is given by the client to an agent
for transmission to the attorney, and it is immaterial whether the agent is the agent of the
attorney, the client, or both.’ ”].)
In assessing whether a communication is confidential and thus privileged, the
initial focus of the inquiry is on the “dominant purpose of the relationship” between
attorney and client and not on the purpose served by the particular communication.
(Costco, supra, 47 Cal.4th at pp. 739-740, italics omitted.) “If the trial court determines
that communications were made during the course of an attorney-client relationship, the
communications, including any reports of factual material, would be privileged, even
though the factual material might be discoverable by other means.” (Id. at p. 740.)
The privilege “is to be strictly construed” in the interest of bringing to light
relevant facts. (Greyhound Corp. v. Superior Court (1961) 56 Cal.2d 355, 396.) The
privilege is also to be strictly construed “where the relationship is not clearly
established.” (People v. Velasquez (1987) 192 Cal.App.3d 319, 327, fn. 4.)
13
“When a party asserts the attorney-client privilege it is incumbent upon that party
to prove the preliminary fact that a privilege exists. [Citation.] Once the foundational
facts have been presented, i.e., that a communication has been made ‘in confidence in the
course of the lawyer-client . . . relationship, the communication is presumed to have been
made in confidence and the opponent of the claim of privilege has the burden of proof to
establish that the communication was not confidential,’ or that an exception exists.
[Citations.]” (State Farm, supra, 54 Cal.App.4th at p. 639.)
Uber never established the Stroz Materials were attorney-client communications
nor could it. The Stroz Materials resulted from a pre-acquisition due diligence process
Uber’s and Otto’s attorneys jointly hired Stroz to perform. Both Levandowski and Ron
had separate personal counsel who never retained Stroz. Uber and Otto attorneys
directed Stroz’s efforts, not the personal attorneys for Levandowski or Ron. Moreover, at
the time Stroz performed its due diligence, the interests of Uber were adverse to those of
Otto, Levandowski and Ron. Uber was in the process of evaluating whether it would
purchase Otto and in doing so indemnify Levandowski and Ron. To that end, when Stroz
interviewed Levandowski and Ron and collected their devices for review, it did not do so
as their agent or on behalf of their attorneys. Levandowski and Ron were the subjects of
an investigation and were not MoFo or O’Melveny clients. Their communications to
MoFo and O’Melveny lawyers through Stroz (the agent) did not constitute information
transmitted from client to lawyer. This is made clear in the Stroz engagement letter. It
provides that “under no circumstances will Stroz Frieberg disclose to Uber or [MoFo] or
any of their representatives any attorney-client privileged communications between
Ottomotto and/or any of its employees, stockholders, officers, members, managers or
directors, on the one hand, and counsel for Ottomotto or counsel to any of such persons,
on the other hand, that are disclosed to or discovered by Stroz Friedberg in its
performance of the services. For the avoidance of doubt, communications between
Ottomotto and/or any of its employees, stockholders, officers, members, managers or
directors, on the one hand, and any of the following attorneys and law firms, on the other
hand, is attorney-client privileged communication and will not be disclosed by Stroz
14
Friedberg to Uber or [MoFo] or any of their respresentatives: O’Melveny & Myers
LLP, . . . .” Thus, Levandowski’s and Ron’s communications with Stroz, as reflected in
the Stroz Materials, and shared with MoFo are not protected by the attorney-client
privilege.
Uber argues that the attorney-client privilege attaches to the Stroz Materials
because Levandowski and Ron were Otto employees when they communicated with
Stroz, who was acting as the agent for Otto’s lawyers at O’Melveny. Uber observes that
“[w]hen a lawyer for a corporation gathers facts from the corporation’s employees in
order to give legal advice to the corporation, those factual communications are
privileged.” Levandowski’s and Ron’s positions as Otto employees or executives does
not alter our analysis. The record shows that neither of them had any attorney-client
relationship with O’Melveny. Each retained separate personal counsel, and the Stroz
engagement letter makes clear that attorney-client privileged information obtained from
Otto employees is not to be shared with Uber and MoFo. Further, Levandowski’s and
Ron’s personal attorneys established additional parameters around sharing certain
information with the MoFo and O’Melveny lawyers. Prior to turning over devices and
account information to Stroz, Ron’s attorney instructed Stroz not to provide MoFo or
O’Melveny or Uber or Otto any of Ron’s privileged documents.4
Next, Uber claims these communications “were made for the purpose of seeking
legal advice” to “assess the potential litigation threats faced” from Google. The record
shows otherwise. The term sheet’s “Indemnity Construct” does not discuss anticipated
litigation. Rather, Diligenced Employees are required to cooperate and make their
devices available to Stroz as a pre-condition to the execution of the Put Call Agreement
and as a means to determine the scope of the indemnified claims. Levandowski did not
comply with the Term Sheet to seek O’Melveny’s legal advice. Rather, he provided
Stroz information to clarify the extent of any obligation arising out of the Indemnity
4
[
REDACTED
]
15
Construct. In a letter written to the MoFo and O’Melveny attorneys, Levandowski’s
lawyer, John Gardner, stated the purposes of the Stroz examination were to “(i) support
the indemnification agreement and (ii) to provide evidence that [Uber] and Otto exercised
due care prior to . . . entering into the Transaction Documents.” Asked in deposition
whether he agreed with the statement by Gardner, Otto’s designated company witness
testified, “You would have to ask Uber about the purposes. As I’ve previously indicated,
my understanding is that it was more broadly related to Uber determining whether to
enter into the transaction, including the indemnification agreement.” The need for legal
advice or to assess potential litigation threat did not drive Levandowski’s or Ron’s
communications with Uber and Otto’s lawyers.
Because Uber was unable to demonstrate Levandowski’s or Ron’s
communications with Stroz were made in the course of an attorney-client relationship,
the attorney-client privilege does not attach.
C. Attorney Work Product
Uber contends that even if the Stroz Materials were not privileged attorney-client
communications, they were protected attorney work product. Google argues the attorney
work product doctrine provides no alternate ground to support the superior court’s
Discovery Order. We agree with Google.
“An attorney’s work product is the product of the attorney’s ‘ “ effort, research,
and thought in the preparation of his client’s case. It includes the results of his own
work, and the work of those employed by him or for him by his client, in investigating
both the favorable and unfavorable aspects of the case, the information thus assembled,
and the legal theories and plan of strategy developed by the attorney—all as reflected in
interviews, statements, memoranda, correspondence, briefs, and any other writings
reflecting the attorney’s ‘impressions, conclusions, opinions, or legal research or
theories’ and in countless other tangible and intangible ways.” ’ [Citations.]” (Meza v.
H. Muehlstein & Co. (2009) 176 Cal.App.4th 969, 977.)
The attorney work product doctrine, codified at Code of Civil Procedure section
2018.030, provides: “A writing that reflects an attorney’s impressions, conclusions,
16
opinions, or legal research or theories is not discoverable under any circumstances.” (§
2018.030, subd. (a).) All other attorney work product “is not discoverable unless the
court determines that denial of discovery will unfairly prejudice the party seeking
discovery in preparing that party’s claim or defense or will result in an injustice.” (§
2018.030, subd. (b).) The superior court did not address the attorney work product
doctrine in the Discovery Order at issue in this appeal, so it made no relevant findings.
Based on the record, the Stroz Materials do not meet either standard.
The Stroz Materials do not reflect an attorney’s impressions, conclusions,
opinions, or legal research or theories. Rather, the Stroz Materials reflect the result of a
factual investigation into possible past misconduct committed by Levandowski and Ron
in the course of leaving Google so that Uber could decide whether to proceed with the
Otto transaction and indemnify Levandowski and Ron. The materials summarize what
Levandowski and Ron told Stroz without the filter of Stroz’s impressions, conclusions,
opinions or legal theories. The exhibits to the Stroz report report [
REDACTED ]
In addition, the engagement letter between Stroz and counsel further indicates that Stroz
was not authorized to practice law and its services were “limited to non-legal services,”
Thus, the Stroz Materials do not constitute opinion work product that is absolutely
protected under section 2018.030, subdivision (a).
Nor do the Stroz Materials qualify for the limited privilege for non-opinion work
product set forth in section 2018.030 subdivision (b). Substantial evidence in the record
supports a conclusion that denial of discovery will unfairly prejudice Google in preparing
its claims. [
REDACTED
17
] These findings supported the arbitration panel’s conclusion that production of
the Stroz Materials “may be one of the only effective ways for Google to obtain certain
relevant information in this case.”5
Uber disputes that Google showed a “substantial need” for the information, and
further argues Google cannot make such a showing because it elected to proceed with the
arbitration without the Stroz Materials while there are alternative means to access it. We
disagree. There is substantial evidence in this record from which the arbitrators could
conclude the information in the Stroz Materials was material to Google’s claims and
could not otherwise be obtained. Moreover, there is no evidence identifying the
alternative sources for it. We simply give no weight to the fact that Google was
proceeding with the arbitration proceedings in the face of the adverse ruling from the trial
court. These factors do not abate or otherwise negate the prejudice Google will unfairly
suffer from being denied the Stroz Materials in arbitration.
D. Waiver and Common Interest Doctrine
Finally, Google contends even if Levandowski’s communications with Stroz were
protected under the attorney-client privilege or attorney work product, any such privilege
was waived by disclosure to Uber and not preserved by the common-interest doctrine.
Google contends the superior court’s reliance on the common-interest doctrine was
misplaced. Because Uber never established the Stroz Materials were privileged or work
product, we need not reach this issue. (See OXY Resources California LLC v. Superior
Court (2004) 115 Cal.App.4th 874, 889.)
DISPOSITION
Uber’s motion to dismiss Google’s appeal is denied. The superior court’s
Discovery Order granting Uber’s petition to vacate the arbitration panel’s discovery
5
On March 12, 2018, Google requested we take judicial notice of an order from
the underlying arbitration which it cites to in its reply brief in support of this argument.
In our April 26, 2018 order, we further deferred ruling on the request until our
consideration of this appeal on the merits. We now deny the request as unnecessary to
our resolution of this appeal. (See Jordache Enterprises, Inc. v. Brobeck, Phleger &
Harrison (1998) 18 Cal.4th 739, 748, fn. 6.)
18
decision is reversed. The matter is remanded to the superior court with directions to enter
a new order denying Uber’s petition to vacate the arbitration award. Google is awarded
costs on appeal.
19
_________________________
Siggins, P.J.
We concur:
_________________________
Pollak, J.
_________________________
Jenkins, J.
20
Uber Technologies, Inc. v. Google, LLC, A153653
21
Trial Court: City & County of San Francisco Superior Court
Trial Judge: Honorable Harold E. Kahn
Counsel:
Keker, Van Nest & Peters, Robert A. Van Nest, Dan Jackson, Jo W. Golub, W. Hamilton
Jordan, Rachel E. Meny, Thomas E. Gorman for Defendant and Appellant.
Boies Schiller Flexner, Meredith R. Dearborn, Juan P. Valdivieso, Hamish Hume, Jessica
Phillips for Plaintiff and Respondent.
Goodwin Procter, Andrew S. Ong for Real Party in Interest, Andrew Levandowski.
Taylor & Patchen, Karen S. Dhadialla for Real Party in Interest, Lior Ron.
22
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(2008)
Kareemah BELL, Plaintiff,
v.
The LIBRARY OF CONGRESS, Defendant.
Civil Action No. 07-1083 (PLF).
United States District Court, District of Columbia.
March 28, 2008.
MEMORANDUM OPINION
PAUL L. FRIEDMAN, District Judge.
This matter is before the Court on defendant's motion to dismiss. The motion will be granted and this action will be dismissed without prejudice.
I. BACKGROUND
Plaintiff alleges that she was removed from the Human Resources Department of the Library of Congress by police for "misconduct" on May 8, 2007. Complaint at 1-2. It appears that she connects her removal to her failure to complete the fingerprinting process required for her work as a volunteer at the Library. See id., Attach.
According to the Library, plaintiff was removed from its computer center for being disruptive and for making inappropriate remarks to another patron and to Library staff. See Memorandum of Points and Authorities in Support of Defendant's Motion to Dismiss ("Def.'s Mot.") at 2-3.[1] Library staff issued to plaintiff two Notices of Violation on May 9, 2007 and May 16, 2007, respectively. Id. at 3.
Plaintiff attributes to the Library unspecified acts of "ongoing discrimination and harassment[.]" Compl. at 2. She requests that the Court "grant [her] the write [sic] to become a trillion ire [sic]." Id.
II. DISCUSSION
A. Plaintiff Has Not Exhausted Administrative Remedies
Defendant reasonably construes the complaint as raising a tort claim against the United States under the Federal Tort Claims Act ("FTCA"). See Def.'s Mot. at 1-2. It moves to dismiss the complaint for lack of subject matter jurisdiction. See id. at 4-6.
Generally, the FTCA provides that the "United States shall be liable [for tort claims] in the same manner and to the same extent as a private individual under like circumstances." 28 U.S.C. § 2674. It operates as a limited waiver of sovereign immunity, rendering the United States amenable to suit for certain, but not all, tort claims. See, e.g., Richards v. United States, 369 U.S. 1, 6, 82 S.Ct. 585, 7 L.Ed.2d 492 (1962). "Absent a waiver, sovereign immunity shields the Federal Government and its agencies from suit." Fed. Deposit Ins. Corp. v. Meyer, 510 U.S. 471, 475, 114 S.Ct. 996, 127 L.Ed.2d 308 (1994).
The FTCA requires that a claimant present her claim "for money damages for injury or loss of property ... caused by the negligent or wrongful act or omission of any employee of the Government while acting within the scope of his office or employment ... to the appropriate Federal agency" prior to filing a civil action in a federal district court. 28 U.S.C. § 2675(a); see McNeil v. United States, 508 U.S. 106, 113, 113 S.Ct. 1980, 124 L.Ed.2d 21 (1993). Plaintiff does not allege that she has submitted an administrative claim under the FTCA to the Library, and the Library demonstrates that "a careful search of the [Library's] FTCA claims files" yielded "no record of any FTCA claim filed by Kareemah Bell." Def.'s Mot., Declaration of Jesse James, Jr. ¶ 3.
"The FTCA bars claimants from bringing suit in federal court until after they have exhausted their administrative remedies." McNeil v. United States, 508 U.S. at 113, 113 S.Ct. 1980. Absent a showing that plaintiff has exhausted her administrative remedies prior to filing her lawsuit; the Court must dismissed. Id.
To the extent that plaintiff alleges that Library staff committed a constitutional tort, such a claim must fail even if plaintiff had exhausted her administrative remedies. The FTCA does not waive the United States' sovereign immunity for constitutional torts that may be committed by its employees. See 28 U.S.C. § 2679(b)(1), (2); Zakiya v. United States, 267 F.Supp.2d 47, 56 (D.D.C.2003) (dismissing prisoner's claims of alleged deprivation of constitutional rights); Meyer v. Fed. Bureau of Prisons, 929 F.Supp. 10, 13 (D.D.C.1996); Kline v. Republic of El Salvador, 603 F.Supp. 1313, 1316-17 (D.D.C. 1985).
B. Plaintiff Failed to File a Timely Opposition to Defendant's Motion to Dismiss
As is customary in civil actions filed by a pro se litigant, the Court issued an Order on September 4, 2007 to advise plaintiff of her obligation to file an opposition to defendant's motion to dismiss and the consequences of her failure to do so. The Court may treat a motion as conceded if the nonmoving party fails to file a memorandum of points and authorities in opposition within a prescribed time period. See LCvR 7(b); FDIC v. Bender, 127 F.3d 58, 67-68 (D.C.Cir.1997) (treating plaintiff's summary judgment motion as conceded because defendant failed to file timely opposition). In this case, plaintiff failed to file an opposition.[2] For this reason, the Court properly may treat defendant's motion as conceded. See, e.g., Fox v. Am. Airlines, Inc., 389 F.3d 1291, 1294 (D.C.Cir.2004) (affirming district court's grant of motion to dismiss as conceded due to the plaintiff's failure to file a response); Malik v. District of Columbia, No. 05-1374, 2008 WL 628544, at *2 (D.D.C. Mar.10, 2008) (granting defendant's summary judgment motion as conceded because plaintiff failed to oppose arguments set forth therein).
III. CONCLUSION
For these reasons, the Court will grant defendant's motion to dismiss. An Order consistent with this Memorandum Opinion is issued separately on this same date.
NOTES
[1] Defendant represents that the exhibits to which it refers in its motion are appended to plaintiff's complaint. See Def.'s Mot. at 2 n. 3. These exhibits do not appear on the Court's electronic docket as attachments to the complaint. See Compl. [Dkt. # 1].
[2] Plaintiff chose instead to file an interlocutory appeal of the September 4, 2007 Order. See Notice of Appeal [Dkt. # 9]. The United States Court of Appeals for the District of Columbia Circuit dismissed the appeal for lack of prosecution. See Bell v. Library of Congress, No. 07-1308, 2008 WL 821036 (D.C.Cir. Feb. 1, 2008).
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716 F.Supp. 5 (1989)
Louise F. WRONIKOWSKI, Plaintiff,
v.
GENERAL HOTELS CORPORATION, Defendant.
Civ. A. No. 89-71095.
United States District Court, E.D. Michigan, S.D.
June 23, 1989.
Deborah L. Fish, Detroit, Mich., for plaintiff.
Marisa C. Petrella, Harvey, Kruse, Westen & Milan, P.C., Detroit, Mich., for defendant.
OPINION AND ORDER
FEIKENS, District Judge.
This matter is before me on defendant's motion to quash service of process, to dismiss for lack of personal jurisdiction, or to transfer venue pursuant to 28 U.S.C.A. § 1404(a). I conclude that exercise of jurisdiction over this case does not violate the due process clause of the Fourteenth Amendment.
Wronikowski, a Michigan resident, suffered a slip and fall injury in the LeClub Lounge of the Holiday Inn-North located in Indianapolis, Indiana. Wronikowski is vice president of the board of directors of New England Towne Houses Cooperatives (New England). In that capacity, Wronikowski attended the annual convention of the Midwest Association of Housing Cooperatives (Midwest) which was held at the Holiday Inn-North. It was there and then that she allegedly suffered personal accidental injury. Wronikowski's reservation was booked by Midwest; her accommodations were paid by New England.
General Hotels Corporation is an Indiana corporation doing business as the Holiday Inn-North and LeClub Lounge. General Hotels manages the Holiday Inn-North on behalf of an Indiana partnership. The partnership is a franchisee of Holiday Inn, Inc. Subject matter jurisdiction is predicated upon diversity of citizenship.
I. Service of Process
The summons in this case was served in Indiana by mail. Fed.R.Civ.P. 4(f) limits effective service of process to the state where the district court sits. Therefore the summons was served improperly. Nonetheless defendant admitted at oral argument that it had waived its right to challenge defective service by failing to object in its first responsive pleading. Thus I turn to the question of personal jurisdiction.
II. In Personam Jurisdiction
Under the due process clause of the Fourteenth Amendment to the United States Constitution a defendant is subject to judgment in personam if it has certain *6 minimum contacts with the forum state such that maintenance of the suit there does not offend "traditional notions of fair play and substantial justice." International Shoe Company v. State of Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945). Such minimum contacts may be found where defendant "purposely avails itself of the privilege of conducting activities within the forum state." Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239, 2 L.Ed.2d 1283 (1958). Defendant's conduct must be such that it should reasonably anticipate being called to account in the forum state. Worldwide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 567, 62 L.Ed.2d 490 (1980). I find that defendant has the requisite contacts with Michigan.
Defendant operates a franchise of Holiday Inn, Inc. (Holiday Inn), a worldwide chain of hotels. Holiday Inn operates a centralized toll-free reservations network which books reservations for travelers at the hotels of its franchisees. Holiday Inn creates good will for its franchisees by advertising on a national basis. There is a substantial number of Holiday Inn hotels in Michigan.
Plaintiff's reservations were booked by Midwest. No doubt, Midwest was partly induced to book defendant's hotel because of the good will generated by Holiday Inn. Midwest either booked the defendant's hotel directly or by communicating through Holiday Inn. In the usual course of events, large conventions are booked only after extensive negotiations between the hotel and the convention organizers. It appears that Midwest's territory consists of Michigan, Illinois, Kentucky, Ohio and Indiana. Defendant knew or should have known that Michigan residents would be in attendance. Under these circumstances, I find that defendant transacted business in Michigan within the meaning of M.C.L.A. § 600.715(1), Michigan's long-arm statute.
Requiring General Hotels to defend in Michigan does not offend traditional notions of fair play and substantial justice. Defendant is a willing beneficiary of Holiday Inn's efforts on its behalf. The foreseeable result of those efforts is that persons from all over the country, including Michigan, will stay at defendant's hotel. Having accepted the benefits of affiliation with a national chain of hotels, defendant must accept the detriments. Affiliation with Holiday Inn permits defendant to reach out to a national market. Having reached out to travelers nationwide, including Michigan travelers, defendant cannot use Holiday Inn as a shield to avoid answering in Michigan's courts.
Witbeck v. Bill Cody's Ranch Inn, 428 Mich. 659, 411 N.W.2d 439 (1987), is distinguishable from the case before me because Bill Cody's is not affiliated with a national chain of hotels. Moreover, the court in Witbeck emphasized that its decision rested on the due process clause of the Constitution, not upon interpretation of Michigan's long-arm statute. Witbeck, supra at 666, 411 N.W.2d 439. Therefore Witbeck does not bind me. To the extent that Witbeck cannot be distinguished from this case, I decline to follow it.
III. Forum Non Conveniens
Defendant moves in the alternative for a change of venue on the grounds of forum non conveniens. Under 28 U.S.C. A. § 1404(a) I have authority to change venue based upon the convenience of the parties and the interests of justice. Both parties intend to call witnesses who would be inconvenienced if they were required to travel to a foreign jurisdiction. Neither side has established that the balance of convenience weighs in its favor. Where the balance of convenience to the parties is roughly equal, I will respect plaintiff's choice of forum and deny a change of venue.
IV. Conclusion
For all the foregoing reasons, defendant's motion to quash service of process, to dismiss for lack of personal jurisdiction and to transfer venue pursuant to 28 U.S. C.A. § 1404(a) is DENIED.
IT IS SO ORDERED.
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198 Wis.2d 105 (1995)
542 N.W.2d 168
C & B INVESTMENTS, Plaintiff-Appellant,[]
v.
WISCONSIN WINNEBAGO HEALTH DEPARTMENT, and Wisconsin Winnebago Business Committee, Defendants-Respondents.
No. 93-2077.
Court of Appeals of Wisconsin.
Submitted on briefs June 8, 1994.
Decided November 9, 1995.
*107 For the plaintiff-appellant the cause was submitted on the brief of Daniel M. Berkos, of Mauston.
For the defendants-respondents the cause was submitted on the brief of Vernle C. Durocher, Jr. and Sonja G. Lemmer of Dorsey & Whitney of Minneapolis, Minnesota.
Before Eich, C.J., Gartzke, P.J., and Sundby, J.
SUNDBY, J.
C & B Investments (C & B) appeals from an order entered July 14, 1993, granting defendants' motion to dismiss C & B's action on contract for lack of jurisdiction because defendants are entitled to sovereign immunity as agencies of the Wisconsin Winnebago Nation. It is undisputed that defendants Wisconsin Winnebago Business Committee (Committee) and Wisconsin Winnebago Tribal Health Board (Health Board) enjoy sovereign immunity from liability. C & B, however, claims that the Committee and the Health Board waived the Nation's sovereign immunity when the Health Board leased C & B's commercial property. We disagree. We therefore affirm the trial court's order.
BACKGROUND
On September 24, 1991, the Health Board entered into a commercial property lease with C & B for the use of a Mauston office building. The Health Board occupied the property and made timely rent payments until January 1993, when it vacated the premises, leaving it *108 in a state of disrepair. The Health Board notified C & B on or about March 1 that they were terminating utility service to the rental property.
On March 15, 1993, C & B commenced this action claiming breach of the lease and damage to the rental premises. Respondents moved to dismiss based on "tribal sovereign immunity." The trial court dismissed the action, finding that respondents did have tribal immunity and that nothing in the lease waived that immunity. We reject C & B's argument that the trial court failed to make findings to support its conclusions.
DECISION
[1]
We review de novo whether the agencies of the Winnebago Nation waived their sovereign immunity. See Rosebud Sioux Tribe v. Val-U Constr. Co., 50 F.3d 560, 562 (8th Cir.), cert. denied, 116 S. Ct. 78 (1995). We decide questions of law without deference to the trial court. Ball v. District No. 4, Area Bd., 117 Wis. 2d 529, 537, 345 N.W.2d 389, 394 (1984).
[2,3]
It is well settled that Native American tribes possess the common-law immunity from suit traditionally enjoyed by sovereign powers. Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58 (1978). A waiver of this immunity cannot be implied but must be unequivocally expressed. Id.
[4]
The Wisconsin Winnebago Nation is a federally recognized Native American tribe and as such enjoys the sovereign immunity guaranteed it by law. The sovereign immunity of the tribe extends to its business arms. See Weeks Constr., Inc. v. Oglala Sioux Housing *109 Auth., 797 F.2d 668, 670-71 (8th Cir. 1986) (Native American housing authority possessed attributes of sovereign immunity). The Winnebago Business Committee is the governing entity of the Wisconsin Winnebago Nation, chartered under the Constitution of the Nation, and functions as an arm of the tribal government. Accordingly, the Nation's sovereign immunity extends to the Committee. The Health Board also shares the Nation's immunity as an agency which functions as an official arm of the Committee on all health-related matters.
Sovereign immunity is typically waived by a "sue or be sued" clause included in the corporate charter when a tribe organizes a corporate entity. Such a clause constitutes an express waiver. Rosebud Sioux Tribe v. A & P Steel, Inc., 874 F.2d 550, 552 (8th Cir. 1989); Weeks Constr., 797 F.2d at 671; Duluth Lumber and Plywood Co. v. Delta Dev., Inc., 281 N.W.2d 377, 384 (Minn. 1979).
It is undisputed that neither the governing documents of the Committee nor the by-laws of the Health Board contain a sue-or-be-sued provision. The lease agreement does not contain such provision. However, despite the absence of a sue-or-be-sued clause, a tribe can waive sovereignty by other acts. For example, when a tribe commences a lawsuit, it waives its immunity. Rosebud Sioux Tribe, 874 F.2d at 552. A tribe waives immunity when it agrees to a non-tribal forum, such as a federal court, to resolve disputes. United States v. Oregon, 657 F.2d 1009, 1016 (9th Cir. 1981). The Alaskan supreme court carried this a step further when it found that a tribe may waive immunity by agreeing to arbitration. Native Village of Eyak v. GC Contractors, 658 P.2d 756, 758-59 (Alaska 1983). To *110 the same effect is Rosebud Sioux Tribe v. Val-U Constr. Co., 50 F.3d at 563.
[5]
However, a sovereign tribe does not waive its immunity simply because it enters into a binding contract. See, e.g., Sac and Fox Nation v. Hanson, 47 F.3d 1061, 1063 (10th Cir.) (waiver of tribal sovereign immunity cannot be implied from a tribe's engagement in commercial activity), cert. denied, 116 S. Ct. 57 (1995); American Indian Agric. Credit Consortium v. Standing Rock Sioux Tribe, 780 F.2d 1374, 1378-79 (8th Cir. 1985) (tribe's sovereign immunity cannot be waived by implication in contract actions); Ramey Constr. Co. v. Apache Tribe of Mescalero Reservation, 673 F.2d 315 (10th Cir. 1982) (attorney's fees clause, loan agreement with a bank, obtaining bonds from a surety, and submitting a certificate stating that the contract documents constitute valid and legally binding obligations did not constitute express waiver).
Davids v. Coyhis, 869 F. Supp. 1401 (E.D. Wis. 1994), addresses how far the doctrine of "express" waiver may be extended. Davids involved a tribe which allegedly violated the Indian Gaming Regulatory Act (IGRA). The tribe moved to dismiss based on sovereign immunity. The plaintiffs cited to two cases from other jurisdictions in which the court found that by engaging in gaming regulated by IGRA, the tribal community effectively waived its sovereign immunity. Id. at 1406. In declining to follow this line of cases, the court reemphasized the rule of Santa Clara Pueblo as follows:
[I]t is still the law of the land that "a waiver of sovereign immunity `cannot be implied but must be unequivocally expressed.'" Santa Clara Pueblo, 436 U.S. at 58 (quoting United States v. Testan, 424 *111 U.S. 392, 399 (1976) (quoting United States v. King, 395 U.S. 1, 4 (1969))) (emphasis added). . . . I believe that Supreme Court precedent constrains me from finding an unequivocal expression of a waiver of tribal sovereign immunity through inference from a tribe's actions.
Davids, 869 F. Supp. at 1408 (part of citations omitted).
The court thus concluded that the community had not "effectively waived" its sovereign immunity simply by engaging in gaming regulated by IGRA. Id. at 1409.
In another case involving a contract dispute, the plaintiff made a fairness argument. Federico v. Capital Gaming Int'l, Inc., 888 F. Supp. 354 (D.R.I. 1995). The plaintiff contracted with a Native American tribe, then sued for damages after the tribe failed to fulfill the terms of the agreement. Among other reasons, plaintiff argued that immunity would mean that the tribe could breach contracts with immunity, and that tribal sovereign immunity is not fair to a plaintiff who has rendered services to the tribe for which the plaintiff has not been compensated. Id. at 356. The court rejected plaintiff's arguments.
[P]laintiff is in a particularly poor position to complain of unfairness in light of the fact that he did not even avail himself of the protections that were available to him. . . . As was the case in Sac and Fox, the complaining party was "free to request a waiver of sovereign immunity" before conducting business with the tribe, but did not do so. Sac and Fox Nation, 47 F.3d at 1065. The plaintiff cannot now be heard to complain of unfairness in that, unless a waiver of sovereign immunity is found, the Tribe will be able to "walk away" from its contract.
Federico, 888 F. Supp. at 357.
*112 As in the case before us, the plaintiff was "free to seek a remedy in a tribal forum, if tribal law provides such a remedy." Id.
[6]
C & B points to paragraph 16 of the lease agreement, which provides: "The covenants and agreements contained herein shall bind the parties mutually, together with their respective heirs, personal representatives and assigns." C & B argues that this provision is sufficient to create an express waiver of immunity. However, C & B cites no authority that general contract language constitutes an express waiver of immunity. Indeed, we have not found any court which has been willing to extend the meaning of "express waiver" to include general contract language.
[7]
C & B argues that if we permit tribal agencies to avoid their contractual obligations by interposing sovereign immunity, we allow Native American tribes to unfairly avoid all legal obligations. C & B argues that paragraph 16 of the lease agreement must be interpreted as a waiver of tribal sovereign immunity because, "[to] do otherwise creates an intolerable situation for anyone to operate in good faith with a tribal entity on a level field of play." However, C & B could have required the tribal agencies to expressly waive their immunity; so may others who contract with Native American nations. Our decision goes no further than to require that a surrender of sovereign immunity by a nation must be advertent. This is no different from the rule we apply to the sovereign immunity of states and the United States. See, e.g., State v. P.G. Miron Constr. Co., 181 Wis. 2d 1045, 1052-53, 512 N.W.2d 499, 503 (1994). Therefore, C & B's argument fails.
*113 By the Court.Order affirmed.
NOTES
[] Petition to review denied.
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255 A.2d 724 (1969)
Harry LANDES
v.
Anthony FAELLA.
No. 553-Appeal.
Supreme Court of Rhode Island.
July 9, 1969.
*725 Kirshenbaum & Kirshenbaum, Alfred Factor and Ernest Barone, for plaintiff.
Luigi Capasso, for defendant.
OPINION
POWERS, Justice.
This is a civil action to recover damages for personal injuries resulting from a motor vehicle collision at the intersection of Broad and Public Streets in the city of Providence.
The case was tried to a superior court justice and a jury which returned a verdict of $700 for plaintiff. Thereafter, defendant seasonably moved for a new trial alleging the usual grounds, and additionally, improper conduct between plaintiff's attorney[1] and the jury foreman. In connection with this latter ground, defendant filed an affidavit wherein he stated, "* * * between the beginning and the ending of the trial of the above matter, I saw the trial attorney for the plaintiff and the foreman of the jury, hearing said case, sitting together on a bench in the Superior Court, and talking to each other * * *."
At the hearing in connection with the new trial motion, the trial justice concluded that a first determination of the allegation of improper conduct required the taking of testimony of the parties involved. At said evidentiary hearing, defendant qualified the assertions contained in his affidavit relative to plaintiff's attorney and the jury foreman having conversed together on a bench. He testified that what he observed was a conversation between the jury foreman, who was seated on a bench, and plaintiff's attorney who was standing facing the foreman with his back to defendant. Calling for a summation of this testimony, counsel asked,
"Q When you saw If I understand you correctly, Mr. Faella, you saw the foreman sitting down, you saw a man standing, talking to him, you approached within fifteen feet of them, you saw *726 them speaking, you turned around and went back the way you came?"
to which defendant replied,
"A Right."
In his testimony, plaintiff's attorney recalled having spoken to the foreman, along with several other jurors in the cloak room after the jury had been discharged but, categorically denied conversing with the foreman or any other member of the jury during the course of the trial. The testimony of the foreman was to the same effect.
Nevertheless, the trial justice granted defendant's motion, stating, and we quote in full:
"I'm going to grant the motion for a new trial. I am not satisfied by the explanation that was made by the plaintiff's counsel. And since there is some doubt, some question about the verdict, I think it's far better to try this case all over again, so there will be no question."
It is well settled that a motion for a new trial based on improper conduct between a member or members of the jury and one of the litigants or his attorney is addressed to the sound discretion of the trial justice. Screw Machine Corp. v. Cutter & Wood Co., 43 R.I. 34, 110 A. 382, 39 Am. Jur. New Trial § 96, and cases cited therein. Furthermore, it is also well settled that to insure confidence in trial by jury, a new trial will be granted whenever it appears that such improper conduct has tended to create bias or prejudice in the minds of the jurors. Carpenter v. Carpenter, 48 R.I. 56, 135 A. 325. See also 55 A.L.R. 750, 39 Am. Jur. New Trial § 96 and cases cited therein.
However, the same authorities are also agreed that before a jury verdict should be set aside for alleged improper conduct, there must be some showing that the conversation complained of was in some wise related to the trial. Here, as previously noted, there is not the slightest suggestion that the conversation of which defendant complained in any way related to the litigation or could have had any effect on the outcome thereof. Moreover, in Patton v. Hughesdale Mfg. Co., 11 R.I. 188, this court held that a motion for a new trial based on the ground of irregularity or misconduct which was known to the movant during the course of the trial, should not be granted where the alleged irregularity or misconduct was not brought to the court's attention before the jury returned its verdict. So holding, the court stated at page 189,
"The defendant having proceeded without objection to what had occurred, and thereby subjected the plaintiff to the expense of a trial occupying several days, which might have been avoided if the objection had been seasonably made, ought not to be permitted, after the jury have rendered a verdict adverse to it, to urge that objection as a reason for setting aside that verdict."
We hold then that in light of the circumstances here presented, it was an abuse of discretion for the trial justice to grant the motion on the alleged misconduct of plaintiff's attorney and the jury foreman. The plaintiff's appeal, as it relates to this phase of the judgment, is sustained.
Our holding in this regard, however, is not in and of itself dispositive of the case since defendant has appealed, contending, in essence, that if the trial justice erred on the misconduct ground, his decision is also reviewable in this court for the reason that he failed to pass on defendant's motion for a new trial on the further grounds that the jury verdict was against the evidence, the law, and the weight thereof.
It is established practice in this jurisdiction that unless obviously unnecessary the trial justice should state in a definite manner his considered opinion upon all of the material grounds relied upon in support of the motion. State v. Terranova, 73 R.I. 149, 54 A.2d 407, Severiano v. Diwinsky, 58 R.I. 237, 192 A. 467. Here, although principally resting his decision on *727 the ground of alleged misconduct, it is apparent from the language that the trial justice employed in rendering his decision, that he had some misgivings about the correctmes of the jury's verdict when considered in light of the law, the evidence, and the weight thereof. Having such misgivings, it was his duty to independently weight the evidence, pass on credibility, and, applying his findings to the law as he gave it to the jury, set the verdict aside if, in his superior judgment, the credible evidence as viewed by him fairly preponderated against the verdict. Dawson v. Rhode Island Auditorium, Inc., R.I., 242 A.2d 407; Barbato v. Epstein, 97 R.I. 191, 196 A.2d 836; Martinelli. v. Steiner, 84 R.I. 339, 123 A.2d 924.
This he failed to do, and in such circumstances it is the duty of this court to examine the record for ourselves and grant a new trial if the evidence, as we view it, strongly preponderates against the jury's verdict. Marcinko v. D'antuono, R.I., 243 A.2d 104. In performing this duty, however, we look to the record to determine whether there is any competent evidence which, if believed, would support the jury's verdict, State v. Contreras, R.I., 253 A.2d 612, Finding such evidence, a new trial will not be granted by this court.
We turn then to a consideration of the evidence in the instant case. It establishes that plaintiff sustained injuries while riding as a passenger[2] in a motor vehicle which was struck by another car being operated by defendant. The evidence further establishes that the collision occurred at the intersection of Broad and Public Streets in the city of Providence. The plaintiff testified that the car in which he was a passenger, proceeding northerly on Broad Street, entered the intersection at a time when the traffice signal was in favor of the car in which he was riding, and flashing red for the car being operated by defendant. He further testified that the car in which he was a passenger was struck by defendant's car at or about the right front door of the car in which plaintiff was riding. This testimony was substantially corroborated by the operator of the car in which plaintiff was a passenger. Clearly then, there is competent evidence to support the jury's verdict which, in the circumstances, should not be disturbed by us.
The plaintiff's appeal is sustained, the defendant's appeal is denied and dismissed, and the case is remitted to the superior court for entry of judgment on the jury's verdict.
NOTES
[1] We deem it desirable to note that plaintiff's counsel at trial was other than the attorney of record in this appeal.
[2] In his charge, the trial justice instructed the jury that plaintiff was not guilty of contributory negligence. There being no exception taken to this charge, it became the law of the case.
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742 N.E.2d 28 (2001)
R.C. PATEL, M.D., Appellant-Defendant,
v.
Mary BARKER, Appellee-Plaintiff.
No. 45A03-0003-CV-96.
Court of Appeals of Indiana.
January 10, 2001.
Rehearing Denied February 15, 2001.
*30 Robert D. Brown, Spangler Jennings & Dougherty, P.C., Merrillville, Indiana, Attorney for Appellant.
Priscilla A. Herochik, Merrillville, Indiana, Attorney for Appellee.
*29 OPINION
KIRSCH, Judge.
R.C. Patel, M.D., appeals the jury verdict against him in favor of Mary Barker, raising the following issues for review:
I. When in the course of a single surgical procedure, the surgeon breaches the applicable standard of care in two or more ways causing separate injuries, whether each of the breaches is a separate occurrence for purposes of the Indiana Medical Malpractice Act.
II. Whether the trial court erred in denying Patel's motion for judgment on the evidence because Barker failed to present any evidence that Patel breached the standard of care causing her colon injury.
We affirm.
FACTS AND PROCEDURAL HISTORY
Barker was diagnosed with a malignancy in her colon and referred to Patel for surgery. Patel performed the surgery, which involved resectioning the colon. During this surgery, Patel used hemoclips[1] to control bleeding. At some point following the surgery, it was discovered that Barker's colon was leaking into her abdominal cavity at the point of reattachment. Patel performed a second surgery to create a colostomy.
Later, doctors discovered that a hemoclip had been left on Barker's ureter. A colorectal surgeon and a urological surgeon then performed a third surgery to remove the hemoclip and reverse the colostomy.
Barker filed a suit for medical malpractice against Patel. At trial, Barker claimed that Patel breached the standard of care in two ways: by suturing the colon in such a way that it leaked and by leaving a hemoclip on her ureter. The case was tried to a jury, which awarded Barker $1,800,000 in damages. The trial court reduced the award to $1,500,000, in compliance with the Indiana Medical Malpractice Act limitation of $750,000 in damages per act of malpractice. Patel now appeals.
DISCUSSION AND DECISION
I. Occurrence of malpractice
Patel first argues that the acts about which Barker complains constitute one *31 "occurrence" under the Indiana Medical Malpractice Act. We note at the outset that the issue before us arises solely from the decision of the Indiana General Assembly to treat medical providers who have committed malpractice differently from other tortfeasors and to compensate those killed or injured as a result of that malpractice differently than those harmed by any other tort. In a negligence action arising from an automobile collision, for example, the negligent driver is liable for all of the damages proximately caused by his negligence and the injured party recovers all of the damages resulting from the negligence without regard to whether the negligent driver breached the standard of care in one or multiple ways. Thus, it is only because of the inability of those injured as a result of medical malpractice to recover the full amount of their damages that the present inquiry becomes relevant.
Patel argues that the acts about which Barker complains constitute one "occurrence" of malpractice under the Indiana Medical Malpractice Act and maintains that Barker should be entitled to only one recovery, or $750,000. Barker, on the other hand, contends that Patel committed two breaches of the standard of care, and therefore two "occurrences" by failing to close her colon correctly and by leaving a hemoclip in place. Thus, she maintains, and the trial court agreed, that she is entitled to recover the statutorily-capped amount of damages for each occurrence of malpractice.
To resolve this dispute, we must interpret the Indiana Medical Malpractice Act. When a statute is clear and unambiguous, we need not apply any rules of construction other than to require that words and phrases be taken in their plain, ordinary, and usual sense. Poehlman v. Feferman, 717 N.E.2d 578, 581 (Ind.1999); Community Hosp. of Anderson & Madison County v. McKnight, 493 N.E.2d 775, 777 (Ind.1986). Clear and unambiguous statutory meaning leaves no room for judicial construction. Poehlman, 717 N.E.2d at 581.
If a statute is ambiguous and its meaning is not clear from the words used, judicial construction is proper. Sue Yee Lee v. Lafayette Home Hosp., Inc., 410 N.E.2d 1319, 1322-23 (Ind.Ct.App.1980). In such case, the purpose and goal of judicial construction is to give effect to the intention of the legislature. Id. A statute should be construed to accomplish the end for which it was enacted. Id. In construing a statute, the court must consider the whole act and, if possible, effect must be given to every word and clause therein. Guinn v. Light, 558 N.E.2d 821, 823 (Ind. 1990). Finally, the Indiana Medical Malpractice Act is in derogation of the common law and must be strictly construed. Cacdac v. West, 705 N.E.2d 506, 510 (Ind. Ct.App.1999), trans. dismissed.
In the Act, malpractice is defined broadly as a tort or breach of contract based on health care services that were provided or that should have been provided to a patient. IC XX-XX-X-XX. IC XX-XX-XX-X further provides:
"(a) The total amount recoverable for an injury or death of a patient may not exceed the following:
(1) Five hundred thousand dollars ($500,000) for an act of malpractice that occurs before January 1, 1990.
(2) Seven hundred fifty thousand dollars ($750,000) for an act of malpractice that occurs:
(A) after December 31, 1989; and
(B) before July 1, 1999.
(3) One million two hundred fifty thousand dollars ($1,250,000) for an act of malpractice that occurs after June 30, 1999.
(b) A health care provider qualified under this article (or IC 27-12 before its repeal) is not liable for an amount in excess of two hundred fifty thousand dollars ($250,000) for an occurrence of malpractice."
*32 Thus, the meaning of the Act hinges on the definitions of the terms "an injury or death," "an act of malpractice," and "an occurrence of malpractice." Although Barker and Patel debate the meaning of the term "occurrence," this term appears only in subsection (b), which discusses the ramifications of a claim to the health care provider. By contrast, subsection (a) is concerned with the effect of the limitation on recovery to the patient. This provision addresses the subject in terms of "injury" and the critical concept is "an act" of malpractice. We therefore conclude that the meaning of "occurrence" is not the dispositive issue here.
In a pair of cases in 1992, this court interpreted the Act's recovery limitation and focused on the term "injury." In St. Anthony Med. Ctr., Inc. v. Smith, 592 N.E.2d 732 (Ind.Ct.App.1992), trans. denied, the plaintiff, the decedent's estate, brought a wrongful death claim based on medical malpractice. Smith, the decedent, went to the hospital to have a test performed. Prior to the test, he was placed on a restrictive diet and instructed to take laxatives. This, combined with the test itself, can cause a hypotensive condition that can lead to a stroke. After the test, Smith was discharged to the dressing room. Four and a half hours later, an aide found him lying on the floor. He had suffered a stroke. Thereafter, he was admitted to the hospital, where he was later administered an overdose of medication. He died two weeks later while still a patient at the hospital. After a trial, the jury awarded Smith's estate nearly one million dollars. The trial court reduced the award to the statutory cap for an act of malpractice, and the estate appealed.
Quoting the language of the statute, we determined that the estate was entitled to recover only $500,000 (the cap at that time), even if Smith had suffered two separate acts of malpractice. This result obtained because "John suffered a single injury, a stroke, which led to his death. Betty's claim, filed against SAMC, is derived from that death." Id. at 739. Thus, the patient's injury was the determinative focus.
Similarly, in Bova v. Roig, 604 N.E.2d 1 (Ind.Ct.App.1992), the plaintiff sued for medical malpractice based upon the care of his left eye. He contended that the defendant committed malpractice in his performance of eye surgery and in the post-operative care that he provided. The plaintiff eventually lost sight in his eye. After a trial, the jury awarded the plaintiff damages in excess of the cap, the trial court reduced the award to the cap amount, and the plaintiff appealed.
Once again focusing on the language of the statute and therefore the injury to the patient, we stated that: "The Act allows a recovery of $500,000 for `any injury or death.' I.C. § 16-9.5-2-2(a). Bova suffered a single injury, blindness in his left eye. Hence, he is entitled to recover only once." Id. at 3.
A few years later, in Miller v. Memorial Hosp. of South Bend, Inc., 679 N.E.2d 1329 (Ind.1997), our supreme court considered whether certain conduct constituted one or two separate acts or occurrences of malpractice. In that case, the plaintiffs alleged that Mrs. Miller's obstetrician failed to appropriately treat her infant in utero for posttermism which resulted in hypoxia and brain damage. The plaintiffs also alleged that the hospital failed to treat the infant upon birth for zero blood glucose, which caused additional, distinct brain damage. Id. at 1331. The plaintiffs argued that these were two separate acts of malpractice resulting in two separate injuries and therefore allowing two separate recoveries under the Malpractice Act.
Our supreme court agreed. It characterized the injuries as prenatal and postnatal, noting that they resulted in damage to different parts of the infant's brain. Further, the plaintiffs' complaint asserted two claims against two defendants and specified different dates for each claim. Thus, the court held that a genuine issue of *33 material fact existed as to "whether Nicholas Miller suffered separate injuries from two distinct alleged occurrences of medical malpractice." Id. at 1329. In noting "the rare factual circumstances" of the case where separate acts caused separate injuries, the Miller court acknowledged that while the Malpractice Act authorizes only one recovery where a single injury exists, irrespective of the number of acts causing the injury, the statute did not preclude separate recoveries where there are two separate and distinct injuries caused by two separate and distinct occurrences of malpractice. It stated:
"The Medical Malpractice Act's limitations apply to `any injury or death of a patient' and `for an occurrence of malpractice.' It authorizes only one recovery in those cases where a single injury exists, irrespective of the number of acts causing the injury. Conversely, there is no dispute that, if there are two separate and distinct injuries caused by two separate occurrences of malpractice, the statute does not preclude two separate recoveries (each separately limited in accordance with the Act)."
Id. at 1331-32 (citations omitted).[2]See also Haswell v. Kramer, 659 N.E.2d 146, 151 (Ind.Ct.App.1995), trans. denied (1996) ("[T]here is nothing in the act precluding recovery for separate injuries that are sustained as a result of more than one act of malpractice.")
Thus, the cases have interpreted the Act as allowing only one recovery when multiple breaches lead to a single injury and multiple recoveries when multiple breaches during more than one procedure lead to multiple injuries. Here, we face the unique case where multiple breaches during a single procedure lead to multiple injuries. Nonetheless, we see no principled reason why this distinction should require a different analysis. Rather, the limitation on recovery applies to "an injury or death," not "an act of malpractice." Here, it is undisputed that Barker had two distinct injuries from two distinct acts of malpractice to two separate body systems, her digestive system and her urinary system. Thus, we believe the plain language of the Act allows for recovery up to the cap amount on each claim arising from separate acts of malpractice resulting in separate injuries.
We hold that the Indiana Medical Malpractice Act allows for one recovery for each distinct act of malpractice that results in a distinct injury, even if the multiple acts of malpractice occur in the same procedure. The trial court did not err in allowing separate recoveries each subject to the statutory cap.
Patel also contends that the trial court erred in reducing the jury's award to $1,500,000. He claims that because the jury returned a general verdict, it was impossible to discern the amount of damages awarded on each claim, and there was no evidence that the jury intended an equal amount of damages on each claim. In essence, Patel asserts that the jury could have awarded one dollar in damages on one of the claims and the remainder on the other, (making his liability after remittitur $750,001) rather than $750,000 on each. However, at trial, Barker requested separate verdict forms for her two claims and Patel objected. Based on Patel's objection, Barker withdrew her request and agreed to the general verdict form. A party cannot invite error then complain about the error on appeal. E.R. v. Marion County Office of Family & Children, 729 N.E.2d 1052, 1061 (Ind.Ct.App.2000) (invited *34 error is not reversible error). Patel has waived the form of the general verdict for appellate review by his failure to challenge it at trial. Stover v. State, 621 N.E.2d 664, 668 (Ind.Ct.App.1993).
II. Judgment on the evidence
Patel next asserts that the trial court erred in denying his motion for a judgment on the evidence contending that there was no evidence that Barker's anastomotic colon leak was the result of any breach of the standard of care by Patel.
The denial of a motion for judgment on the evidence is within the broad discretion of the trial court and will be reversed only for an abuse of that discretion. Zemco Mfg., Inc. v. Pecoraro, 703 N.E.2d 1064, 1071 (Ind.Ct.App.1998), trans. denied (1999). In reviewing a trial court's ruling on a motion for judgment on the evidence, we apply the same standard as the trial court and look only to the evidence and reasonable inferences most favorable to the non-moving party. City of Fort Wayne v. Moore, 706 N.E.2d 604, 607 (Ind.Ct.App.1999), trans. denied; Firstmark Standard Life Ins. Co. v. Goss, 699 N.E.2d 689, 696 (Ind.Ct.App.1998), trans. denied (1999).
When the defendant moves for judgment on the evidence at the close of the plaintiff's evidence in a jury trial, the motion should be granted only where an issue in the case or an essential element of the claim is not supported by sufficient evidence. Firstmark, 699 N.E.2d at 696; see Ind. Trial Rule 50(A). Judgment on the evidence is appropriate only if there is no substantial evidence or reasonable inferences to be drawn therefrom to support an essential element of the claim. City of Fort Wayne, 706 N.E.2d at 607. If there is any probative evidence or reasonable inference to be drawn from the evidence or if there is evidence allowing reasonable people to differ as to the result, judgment on the evidence is improper. Firstmark, 699 N.E.2d at 696.
Here, Dr. Joseph Tyrrell, who assisted on Barker's surgery, and who was a general doctor and surgeon, testified that while a leak is more likely the result of anatomy, the surgeon's technique can play a role in developing a leak. He stated that if the surgeon examines the bowel, he should be able to see if there is a leak. He also opined that it is inappropriate to close a surgical incision if there is a leak and that it is a deviation from the standard of care to close an incision without diagnosing a leak if a leak is present. This was evidence of Patel's breach of the standard of care which resulted in Barker's colon leak. Thus, there was evidence on every element of the claim, and Patel was not entitled to judgment on the evidence. The trial court did not err in denying Patel's motion.
Affirmed.
DARDEN, J., concurs.
FRIEDLANDER, J., dissents with separate opinion.
FRIEDLANDER, Judge, dissenting.
I believe that Barker is entitled to recover for only one incident of malpractice under the Indiana Medical Malpractice Act (the Act) and respectfully dissent from the majority's conclusion to the contrary.
I agree with the majority to the extent that it characterizes the question as one involving "multiple breaches during a single procedure." Op. at 33. The majority focuses upon the "multiple breaches" in concluding that there were two incidents of medical malpractice under the Act. I, on the other hand, believe that the dispositive fact is that Barker's allegation's stem from a single surgery.
Previous opinions of the Indiana Supreme Court and this court have acknowledged that the Act was a legislative response to an impending health care crisis in the 1970s.
Specifically, "the problem of expensive medical malpractice insurance, which had been simmering for over a decade, came to *35 a boil and threatened to make such insurance completely unavailable." Winona Memorial Hosp. Found. of Indianapolis v. Lomax, 465 N.E.2d 731, 738 (Ind.Ct.App. 1984). The Act "was the legislative response to the crisis in the availability of medical malpractice insurance, which, in turn, was threatening the availability of the health care services to the public." Id. at 739. Our supreme court noted in Rohrabaugh v. Wagoner, 274 Ind. 661, 413 N.E.2d 891 (1980) that one of the methods conceived by the Legislature to remedy this problem involved limiting patient remedies against health care providers. Those limitations included restricting the amount of money a medical malpractice plaintiff could recover. It is beyond debate that the cap on recoveries under the Act is an integral part of the legislative scheme. As the majority notes, our courts have several times been called upon to determine issues relating to the cap. Since the cap aspect of the Act was declared constitutional, the question is seldom, if ever, presented in the form of a challenge to the actual amount of the cap. Rather, plaintiffs have sought to increase the amount of their recoveries on the basis of multiple claims of malpractice.
Thus far, the principles that have emerged on this question are that (1) a person may recover only once for a single injury, even where that injury was caused by multiple breaches of the standard of care, see, e.g., Bova v. Roig, 604 N.E.2d 1 (Ind.Ct.App.1992) and (2) multiple recoveries may result from multiple, separate breaches that cause multiple injuries. See, e.g., Miller v. Memorial Hosp. of South Bend, Inc., 679 N.E.2d 1329 (Ind.1997). I find those conclusions unassailable, in part because those principles are entirely consistent with the purpose and legislative intent underlying the Act.
With regard to the question at issue here, the Act neither expressly embraces nor rejects the concept of multiple recoveries for multiple breaches in a single surgical procedure. Indiana's appellate courts have not decided a case that compels either result. Indeed, viewed strictly as an exercise in statutory construction, the majority's analysis is not unreasonable. My disagreement with the law created in the instant case is based upon my conclusion that it contravenes the purpose of the Act, and therefore also contravenes the intent of the legislature that passed the Act.
The principles that emerge from the cases that have thus far grappled with this question embody the concept that, in order to justify multiple recoveries, there must be a separation in time and circumstance of the multiple breaches. See, e.g., Miller v. Memorial Hosp. of South Bend, Inc., 679 N.E.2d 1329 (involving prenatal and postnatal injury to a child). In my view, for purposes of the Act, a surgical procedure should be regarded as a single act of medical treatment, albeit one that may include many steps. The various steps in a surgery are not sufficiently distinct from one another in time and circumstance to justify multiple recoveries under the Act. In other words, the Act does not contemplate the possibility of as many recoveries of the cap amount as there are steps in a single surgical procedure. Such runs contrary to the very purpose of the Act. I believe that when the Legislature limited recovery to $750,000 for an act of malpractice, it did not envision or intend multimillion-dollar recoveries stemming from what is referred to in the common vernacular as a "botched" surgery, regardless of the number of ways in which it was botched.
I would reverse the trial court and limit the amount of Barker's recovery to $750,000.
NOTES
[1] A hemoclip is similar in function and appearance to a staple.
[2] We note that the courts in Miller, Bova, and Smith interpreting the Act discussed it as it appeared at IC 16-9.5-2-2. At that time, the limitation on recovery applied to "any injury or death" (emphasis added). In 1993, the General Assembly recodified the Act at IC XX-XX-XX-X. When it did so, it changed the statutory language to "an injury or death" (emphasis added). We perceive no substantive change was intended or effected by this change. The Act was subsequently moved again to its present location in title 34, but the language was not altered.
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Opinions of the United
1998 Decisions States Court of Appeals
for the Third Circuit
12-30-1998
Conte Bros Auto Inc v. Quaker State Slick
Precedential or Non-Precedential:
Docket 98-5136
Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_1998
Recommended Citation
"Conte Bros Auto Inc v. Quaker State Slick" (1998). 1998 Decisions. Paper 288.
http://digitalcommons.law.villanova.edu/thirdcircuit_1998/288
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Filed December 30, 1998
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 98-5136
CONTE BROS. AUTOMOTIVE, INC. and HI/TOR
AUTOMOTIVE, Individually and on Behalf of all Others
Similarly Situated,
Appellants,
v.
QUAKER STATE-SLICK 50, INC., SLICK 50
MANAGEMENT, INC., SLICK 50 PRODUCTS CORP., SLICK
50 CORP., BLUE CORAL-SLICK 50, INC., BLUE CORAL,
INC., BLUE CORAL-SLICK 50, LTD.
ON APPEAL FROM THE
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW JERSEY
(Civ. No. 97-3796)
District Judge: The Honorable Jerome B. Simandle
Argued: November 4, 1998
Before: SCIRICA and ALITO, Circuit Judges,
and GREEN, District Judge*
(Opinion Filed: December 30, 1998)
_________________________________________________________________
*The Honorable Clifford Scott Green, United States District Judge for the
Eastern District of Pennsylvania, sitting by designation.
JAY W. EISENHOFER (ARGUED)
MEGAN D. McINTYRE
Grant & Eisenhofer, P.A.
1220 N. Market Street, Suite 500
Wilmington, DE 19801
PETER L. MASNIK
KALIKMAN & MASNIK
2 Kings Highway West
Haddonfield, NJ 08033
LEE SQUITIERI
ABBEY, GARDY & SQUITIERI, LLP
212 East 39th Street
New York, NY 10016
Counsel for Appellants
IRVING SCHER
BRUCE A. COLBATH (ARGUED)
GARRY A. BERGER
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
EDWARD T. KOLE
Willentz, Goldman & Spitzer
90 Woodbridge Center Drive
P.O. Box 10
Woodbridge, NJ 07095-0985
Counsel for Appellees
OPINION OF THE COURT
ALITO, Circuit Judge:
The issue in this appeal is whether retailers have
standing under S 43(a) of the Lanham Act, 15 U.S.C.
S 1125(a) (1994), to bring false advertising claims against
manufacturers of products that compete with those the
retailers sell. The District Court answered this question in
the negative and dismissed the Complaint. Conte Bros.
Automotive, Inc. v. Quaker State-Slick 50, Inc., 992 F. Supp.
2
709, 711 (D.N.J. 1998). Based on the facts alleged in the
Complaint, we conclude that the retailer plaintiffs do not
satisfy the prudential standing requirements implicit in
S 43(a) of the Lanham Act. We therefore affirm.
I.
Appellants are a putative nationwide class of retail sellers
of motor oil and other engine lubricants that purportedly
compete with Slick 50, a Teflon-based engine lubricant
manufactured by Appellees. According to the Complaint,
Slick 50 features a formula of Teflon suspended in particle
form in motor oil. Compl. P 17; App. 16. Appellees'
marketing materials state that one quart of Slick 50
substitutes for one quart of regular motor oil at the time of
an oil change. Compl. P 18; App. 16. The Complaint alleges
that the Appellees falsely advertised that the addition of
Slick 50 would reduce the friction of moving parts, decrease
engine wear, and improve engine performance and
efficiency. See, e.g., Compl.PP 24-29.
In 1996, the Federal Trade Commission ("FTC") brought
an action under 15 U.S.C. S 45(a) challenging the veracity
of and substantiation for the claimed benefits of Slick 50.
Compl. P 31; App. 20. The parties settled. Compl. P 33;
App. 21. Under the terms of the settlement, the Appellees
were enjoined from disseminating false or unsubstantiated
claims regarding Slick 50 and agreed to provide $10 million
in discounts, cash rebates and free products to affected
consumers by January 1998. 5 Trade Reg. Rep. P 24,301.
Subsequent to the settlement of the FTC suit, Appellants
raised the same allegations in this action for damages
under S 43(a) of the Lanham Act, 15 U.S.C.S 1125(a)
(1994), and certain state consumer protection statutes that
are not at issue in this appeal. The Appellants propose to
represent:
[a]ll persons in the United States who, at any time
between the time Slick 50 was first marketed to the
public and the present, have offered for sale, either as
retailers or wholesalers, motor oil products that
compete directly with Slick 50.
3
Compl. P 15; App. 13. "Motor oil products," as Appellants
use the term in the Complaint, include "engine additive,
engine treatment products, motor oil or motor oil additives
(sometimes referred to as engine treatments) that compete
with" Slick 50. Compl. P 1; App. 9. In addition to the
allegations regarding Appellees' asserted
misrepresentations, which largely mirror the allegations in
the FTC suit, the Complaint alleges that Appellees' false
advertisements increased Slick 50's sales and
concomitantly decreased sales of the competing products
sold by the class members. The harm the Appellants allege
they suffered is loss of sales of products they sell, such as
regular motor oil, that compete with Slick 50.
Appellees moved to dismiss the Complaint for lack of
standing or, in the alternative, to strike the Appellants'
class allegations. The District Court dismissed the
Complaint on the ground that retailers like Appellants
lacked standing under the Lanham Act to pursue false
advertising claims against manufacturers of competing
products. Conte Bros. Automotive, Inc. v. Quaker State-Slick
50, Inc., 992 F. Supp. 709, 712-14 (D.N.J. 1998). More
specifically, the District Court held that only"direct
commercial competitors" or "surrogates" for direct
commercial competitors have standing to pursue claims
under S 43(a). The District Court also held that the
Complaint failed to allege facts sufficient to infer that the
requisite direct competitive relationship existed. This appeal
followed.
II.
Our review of matters of standing and statutory
construction is plenary. Davis v. Philadelphia Hous. Auth.,
121 F.3d 92, 94 n.4 (3d Cir. 1997); UPS Worldwide
Forwarding, Inc. v. United States Postal Serv., 66 F.3d 621,
624 (3d Cir. 1995), cert. denied, 561 U.S. 1171, 116 S. Ct.
1261, 134 L.Ed.2d 210 (1996). When reviewing an order of
dismissal for lack of standing, we accept as true all
material allegations of the complaint and construe them in
favor of the plaintiff. Steel Co. v. Citizens for a Better Env't,
118 S. Ct. 1003, 1017 (1998); Trump Hotels & Casino
4
Resorts, Inc. v. Mirage Resorts Inc., 140 F.3d 478, 482 (3d
Cir. 1998).
A.
Section 43(a) of the Lanham Act, pursuant to which this
suit was brought, provides:
(1) Any person who, on or in connection with any goods
or services, or any container for goods, uses in
commerce any word, term, name, symbol, or device, or
any combination thereof, or any false designation of
origin, false or misleading description of fact, or false or
misleading representation of fact, which--
(A) is likely to cause confusion, or to cause mistake,
or to deceive as to the affiliation, connection, or
association of such person with another person, or
as to the origin, sponsorship, or approval of his or
her goods, services, or commercial activities by
another person, or
(B) in a commercial advertising or promotion,
misrepresents the nature, characteristics, qualities,
or geographic origin of his or her or another person's
goods, services, or commercial activities,
shall be liable in a civil action by any person who
believes that he or she is or is likely to be
damaged by such act.
15 U.S.C. S 1125(a) (emphasis added). The question in this
suit is whether, in enacting the Lanham Act, which
includes the quoted language, Congress intended to confer
standing on plaintiffs in Appellants' position. For the
reasons set forth below, we hold that Congress did not so
intend, and we therefore affirm.
Standing is comprised of both constitutional and
prudential components. Bennett v. Spear, 117 S. Ct. 1154,
1161 (1997) (citing Warth v. Seldin, 422 U.S. 490, 498, 95
S. Ct. 2197, 2205, 45 L.Ed.2d 343 (1975)). The
constitutional component, derived from the Art. III "case" or
"controversy" requirement, requires a plaintiff to
demonstrate that he or she suffered "injury in fact," that
the injury is "fairly traceable" to the actions of the
5
defendant, and that the injury will likely be redressed by a
favorable decision. Bennett, 117 S. Ct. at 1161; Steel Co. v.
Citizens for a Better Env't, 118 S. Ct. 1003, 1016-17 (1998).
The parties do not dispute that the allegations in the
Complaint satisfy these constitutional standing
requirements. Because this issue is jurisdictional, however,
we address it here. See Steel Co., 118 S. Ct. at 1011
(question of Art. III standing is threshold issue that should
be addressed before issues of prudential and statutory
standing). The Complaint alleges that the plaintiff class has
lost sales of motor oil products as a result of Appellees'
false advertising. Compl. P 43; App. 22. These allegations
satisfy the first two components of Art. III standing, injury
in fact and causation. Appellants seek, among other things,
"monetary damages sufficient to compensate Plaintiffs and
the Class members for their lost profits as a result of the
Defendants' conduct." Compl. P 51(C); App. 25. The
requested relief, if granted, would redress Appellants'
alleged injuries and therefore satisfies the redressability
requirement. Based on the allegations in the Complaint, we
perceive no constitutional obstacle to our consideration of
this case.
Under certain circumstances, prudential, as opposed to
constitutional, standing considerations limit a plaintiff's
ability to bring suit. These prudential considerations are a
set of judge-made rules forming an integral part of "judicial
self-government." Lujan v. Defenders of Wildlife, 504 U.S.
555, 560, 112 S. Ct. 2130, 2136, 119 L.Ed.2d 351 (1992).
The aim of this form of judicial self-governance is to
determine whether the plaintiff is "a proper party to invoke
judicial resolution of the dispute and the exercise of the
court's remedial powers." Bender v. Williamsport Area Sch.
Dist., 475 U.S. 534, 546 n.8, 106 S. Ct. 1326, 1334 n.8, 89
L.Ed.2d 501 (1986); see also Phillips Petroleum Co. v.
Shutts, 472 U.S. 797, 804, 105 S. Ct. 2965, 2970, 86
L.Ed.2d 628 (1985) (federal courts adopt prudential limits
on standing "to avoid deciding questions of broad social
import where no individual rights would be vindicated and
to limit access to the federal courts to those litigants best
suited to assert a particular claim") (quoting Gladstone,
Realtors v. Village of Bellwood, 441 U.S. 91, 99-100, 99 S.
Ct. 1601, 1607-08, 60 L.Ed.2d 66 (1979)).
6
No single formula is capable of answering every
prudential standing question. Clarke v. Securities Indus.
Ass'n, 479 U.S. 388, 400 n.16, 107 S. Ct. 750, 757 n.16,
93 L.Ed.2d 757 (1987) ("Generalizations about standing to
sue are largely worthless as such.") (quoting Data
Processing Serv. v. Camp, 397 U.S. 150, 151, 90 S. Ct. 827,
829, 25 L.Ed.2d 184 (1970)); see also Associated Gen.
Contractors v. California State Council of Carpenters, 459
U.S. 519, 537 n.33, 103 S. Ct. 897, 74 L.Ed.2d 723 (1983)
("[I]t is simply not possible to fashion an across-the-board
and easily applied standing rule which can serve as a tool
of decision for every case."). Several considerations falling
within the general rubric of prudential standing, however,
are typically invoked. Thus, it is generally required (1) that
a litigant "assert his [or her] own legal interests rather than
those of third parties," (2) that courts "refrain from
adjudicating abstract questions of wide public significance
which amount to generalized grievances," and (3) that a
litigant demonstrate that the asserted interests are
arguably within the "zone of interests" intended to be
protected by the statute, rule or constitutional provision on
which the claim is based. Wheeler v. Travelers Ins. Co., 22
F.3d 534, 538 (3d Cir. 1994) (citations omitted); see also
UPS Worldwide Forwarding, Inc. v. United States Postal
Serv., 66 F.3d 621 (3d Cir. 1995); Trump Hotels & Casino
Resorts, Inc. v. Mirage Resorts Inc., 140 F.3d 478, 485 (3d
Cir. 1998); Davis v. Philadelphia Hous. Auth., 121 F.3d 92,
96 (3d Cir. 1997).
In this case, the Appellants assert their own interests,
and their dispute is concrete in nature. Further, neither of
the parties has framed the issue by reference to the "zone
of interests" test. The issue in this appeal, rather, is the
Appellants' statutory standing -- that is, whether Congress
intended parties in Appellants' position to have standing to
sue under S 43(a).
Though sometimes analogized to the "zone of interests"
test identified above, the question of a party's standing to
sue under a given statute is not governed exclusively by the
"zone of interests" test. The "zone of interests" test
developed in the administrative law context where the issue
is whether a person aggrieved by an administrative decision
7
has standing to challenge it under S 10 of the
Administrative Procedures Act, 5 U.S.C. S 702 (1994) (the
"APA"). See Davis, 121 F.3d at 96-98 (recounting
development of "zone of interests" test). Certain attributes
of the "zone of interests" test, most notably its liberal tilt
toward recognizing standing to challenge agency action, see
id. at 98 ("zone of interests" test "not meant to be especially
demanding") (quoting Clarke, 479 U.S. at 399, 107 S. Ct. at
757), were developed in the administrative context, and are
most applicable there. Clarke, 479 U.S. at 400 n.16 ("The
principal cases in which the `zone of interest' test has been
applied are those involving claims under the APA, and the
test is most usefully understood as a gloss on the meaning
of S 702."); cf. Bennett, 117 S. Ct. at 1161 ("[T]he breadth of
the zone of interests varies according to the provisions of
law at issue, so that what comes within the zone of
interests of a statute for purposes of obtaining judicial
review of administrative action under the `generous review
provisions' of the [APA] may not do so for other purposes.")
(citations omitted); see also William A. Fletcher, The
Structure of Standing, 98 Yale L. J. 221, 255-263 (1988)
(criticizing use of "zone of interest" test outside of
administrative context).
The "zone of interests" test, therefore, is not exclusive for
determining statutory standing outside of the
administrative context in which it was formulated, Clarke,
479 U.S. at 400 n.16, 107 S. Ct. at 757 n.16, 93 L.Ed.2d
757 ("[w]hile inquiries into reviewability or prudential
standing in other contexts may bear some resemblance to
a `zone of interests' inquiry under the [APA], it is not a test
of universal application"); see also Davis, 121 F.3d at 97
n.7 (recognizing that variations of the zone of interests test
apply outside of the administrative review context), and it is
clear that we are free to consider other barometers of
congressional intent in determining whether a party has
standing to sue under a particular statute. See Associated
Gen. Contractors v. California State Council of Carpenters,
459 U.S. 519, 537 n.33 (1983) (focusing exclusively on
directness of injury or whether injury is "within zone of
interests protected by antitrust laws" leads to contradictory
and inconsistent results).
8
We believe it is more appropriate to inquire as to the
class's statutory standing free from the formalistic
constraints of the "zone of interests" test and its links to
administrative review. For purposes of determining a party's
standing under S 43(a), we equate our task with the inquiry
into congressional intent conducted by the Supreme Court
in Associated General in determining standing to sue under
the Clayton Act. See Clarke, 479 U.S. at 399 (inquiry "at
bottom . . . turns on congressional intent"). We turn to this
question in Section II(C) infra.
B.
Before reaching this central issue, however, we mustfirst
address a related question of statutory interpretation.
Because prudential standing doctrine is judge-made and
not the product of constitutional restraints on the power of
the federal courts to hear claims, Congress can eliminate
prudential restrictions on standing if it so desires. Bennett,
117 S. Ct. at 1161; United Food & Commercial Workers
Union v. Brown Group, Inc., 517 U.S. 544, 557, 116 S. Ct.
1529, 1536, 134 L.Ed.2d 758 (1996); Warth v. Seldin, 422
U.S. 490, 501, 95 S. Ct. 2197, 2206 (1975); Gladstone,
Realtors v. Village of Bellwood, 441 U.S. 91, 103 n.9, 99 S.
Ct. 1601, 1609 n.9, 60 L.Ed.2d 66 (1979); Trafficante v.
Metropolitan Life Ins. Co., 409 U.S. 205, 209, 93 S. Ct. 364,
366, 34 L.Ed.2d 415 (1972). As a matter of statutory
interpretation, however, Congress is presumed to
incorporate background prudential standing principles,
unless the statute expressly negates them. Bennett, 117 S.
Ct. at 1162; Brown Group, 517 U.S. at 557, 116 S. Ct. at
1536.
The first inquiry, then, is whether Congress expressly
negated prudential standing doctrine in passing the
Lanham Act. In determining whether Congress intended to
abrogate the background presumption that prudential
standing doctrine applies, we consider the statutory text,
its structure, and its legislative history. See Bennett, 117 S.
Ct. at 1162-63 (considering purpose of Endangered Species
Act of 1973, Pub. L. No. 93-205, 87 Stat. 884 (codified as
amended in scattered sections of 16 U.S.C.)), in
determining whether Congress abrogated prudential
9
standing doctrine); Gladstone, 441 U.S. at 107-109, 99 S.
Ct. at 1612-13, 60 L.Ed.2d 66 (considering legislative
history in determining whether Congress abrogated
prudential standing doctrine); cf. Block v. Community
Nutrition Inst., 467 U.S. 340, 344, 104 S. Ct. 2450, 2453-
54, 81 L.Ed.2d 270 (1984) (whether party has standing to
challenge administrative ruling interpreting Agricultural
Marketing Agreement Act of 1937 properly determined"not
only from its express language, but also from the structure
of the statutory scheme, its objectives, [and] its legislative
history"). We hold, based on the text of S 43(a), the explicit
language of the Lanham Act declaring its purpose, as well
as the Lanham Act's legislative history, that Congress did
not expressly negate prudential standing doctrine in
passing the Lanham Act.
We note first of all that background presumptions of
prudential standing apply unless expressly negated by
Congress. Bennett, 117 S. Ct. at 1162. The Supreme Court
has twice held that Congress has not expressly negated
background prudential standing doctrine merely by passing
a statute the text of which admits of a broad interpretation.
Thus, in Bennett, while the Supreme Court ultimately
concluded that Congress intended standing to be limited
only by constitutional constraints on the federal judicial
power, it did so only after considering the broader purposes
of the statute. Id. at 1162-63 ("Our readiness to take the
term `any person'1 at face value is greatly augmented by two
_________________________________________________________________
1. The statute at issue in Bennet, the Endangered Species Act of 1973,
Pub. L. No. 93-205, 87 Stat. 884 (codified as amended in scattered
sections of 16 U.S.C.), provides:
(1) Except as provided in paragraph (2) of this subsection any
person may commence a civil suit on his own behalf--
(A) to enjoin any person, including the United States and any
other governmental instrumentality or agency (to the extent
permitted by the eleventh amendment to the Constitution), who is
alleged to be in violation of any provision of this chapter or
regulation issued under the authority thereof; or
. . . . . . . .
(C) against the Secretary where there is alleged a failure of the
Secretary to perform any act or duty under section 1533 of this
10
interrelated considerations: that the overall subject matter
of this legislation is the environment (a matter in which it
is common to think all persons have an interest) and that
the obvious purpose of the particular provision in question
is to encourage enforcement by so-called `private attorneys
general.' "). And in Associated General, the case most
directly on point, the Supreme Court held that Congress
incorporated prudential standing principles when it
promulgated the Clayton Act. Associated General, 459 U.S.
at 535 & n.31 (considering prudential limits on standing
despite statutory language giving "[a]ny person who shall be
injured in his business or property" standing to sue under
the Clayton Act).2
Based on the foregoing analysis, we must reject
Appellants' contention that they are entitled to bring suit
based on a literal reading of S 43(a). Initially, we note that
our precedent goes beyond the text of the Lanham Act in
determining whether a party has standing. See, e.g., Thorn
v. Reliance Van Co., 736 F.2d 929, 931-32 (3d Cir. 1984)
(applying plain meaning rule to S 43(a) and then applying
prudential standing doctrine before concluding that plaintiff
had standing to bring action). The Appellants' plain
language argument, moreover, misses the mark for a more
fundamental reason. Limiting standing according to well-
established prudential standing doctrine does no violence to
the plain meaning of the statute, because, as explained
above, Congress intends to incorporate prudential standing
_________________________________________________________________
title which is not discretionary with the Secretary. The district
courts shall have jurisdiction, without regard to the amount in
controversy or the citizenship of the parties, to enforce any such
provision or regulation, or to order the Secretary to perform such
act or duty, as the case may be . . . .
16 U.S.C. S 1540(g) (1994).
2. Although the Court in Associated General did not make explicit
findings regarding whether Congress expressly negated background
prudential standing doctrine, the Court has subsequently cited
Associated General for precisely that proposition. See Bennett, 117 S. Ct.
at 1162 (citing Associated General for the proposition that Congress
legislates against the background of prudential standing doctrine unless
it is expressly negated). We discuss Associated General at greater length
in Section II(C) of this opinion.
11
principles unless it expresses its desire to negate them.
Controlling precedent compels us to consider the statutory
text in the larger context of both the statute's purpose and
its background before we can conclude that Congress
intended to confer standing as broadly as the statute's
language suggests.
First, we consider the text of the statute in discerning
Congressional intent. In Bennett, the Supreme Court
considered whether Congress intended to expand standing
under the Endangered Species Act of 1973 ("ESA") to the
extent permitted by Art. III. The statutory language at issue
in the ESA, which said that "any person" could commence
suit, is, as noted by the Court, "an authorization of
remarkable breadth when compared with the language
Congress ordinarily uses." Id. at 1162. It is, indeed, broader
than the relevant language in S 43(a), which says that "any
person who believes that he or she is or is likely to be
damaged" by conduct proscribed by the Lanham Act can
bring suit. We find it significant that the Lanham Act limits
the class of persons entitled to sue to those who can trace
their injury to the anti-competitive conduct proscribed by
the Act, and find in the text support for our conclusion that
Congress did not abrogate principles of prudential
standing. Furthermore, we note that the Supreme Court
recently recognized that prudential standing principles were
incorporated into the Federal Election Campaign Act of
1971, 86 Stat. 11, as amended, 2 U.S.C. S 431 et seq., an
act with operative language at least as expansive as that
found in the Lanham Act. Federal Election Comm'n. v.
Akins, 118 S. Ct. 1777, 1783 (1998); 2 U.S.C.
S 437g(a)(8)(A) (1994) ("[a]ny party aggrieved" may file a
petition in district court seeking review).
The structure of the Lanham Act provides further support
for our conclusion that Congress did not intend to abrogate
prudential limitations on standing. Congress specified its
intent in enacting the Lanham Act in S 45 of the statute,
which reads in pertinent part:
The intent of this chapter is to regulate commerce
within the control of Congress by making actionable
the deceptive and misleading use of marks in such
commerce; to protect registered marks used in such
12
commerce from interference by State, or territorial
legislation; to protect persons engaged in such
commerce against unfair competition; to prevent
fraud and deception in such commerce by the use of
reproductions, copies, counterfeits, or colorable
imitations of registered marks, and to provide rights
and remedies stipulated by treaties and conventions
respecting trade-marks, trade names, and unfair
competition entered into between the United States and
foreign nations.
15 U.S.C. S 1127 (1994) (emphasis added).3 This section
makes clear that the focus of statute is on anti-competitive
conduct in a commercial context. Conferring standing to
the full extent implied by the text of S 43(a) would give
standing to parties, such as consumers, having no
competitive or commercial interests affected by the conduct
at issue. This would not only ignore the purpose of the
Lanham Act as expressed by S 45, but would run contrary
to our precedent, see Serbin v. Ziebart Int'l Corp., 11 F.3d
1163, 1174 (3d Cir. 1993) (consumers lack standing to
bring Lanham Act false advertising claim), and that of other
federal appellate courts. See Colligan v. Activities Club of
New York, Ltd., 442 F.2d 686 (2d Cir.) (same), cert. denied,
404 U.S. 1004, 92 S. Ct. 559, 30 L.Ed.2d 557 (1971);
Barrus v. Sylvania, 55 F.3d 468 (9th Cir. 1995) (same);
Dovenmuehle v. Gilldorn Mortgage Midwest Corp., 871 F.2d
697 (7th Cir. 1989) (same). The congressionally-stated
purpose of the Lanham Act, far from indicating an express
intent to abrogate prudential standing doctrine, evidences
an intent to limit standing to a narrow class of potential
plaintiffs possessing interests the protection of which
furthers the purposes of the Lanham Act. The Lanham Act's
commercial subject matter and express statement of
purpose thus distinguish it from the statute considered by
the Supreme Court in Bennett. The Supreme Court noted
that the subject matter of the ESA -- the environment --
readily admitted of a finding that Congress intended to
expand standing to the limit permitted by Art. III. Bennett,
_________________________________________________________________
3. The quoted portion of S 45 has not been altered since the Lanham Act
was enacted in 1946. See Pub. L. No. 489, reprinted in 1946
U.S.C.C.A.N. 412, 429.
13
117 S. Ct. at 1163 (noting that "the subject of the
legislation makes the intent to permit enforcement by
everyman even more plausible"). The same cannot be said
of the expressly commercial purpose of the Lanham Act.
Our conclusion regarding congressional intent is
reinforced by the legislative history of the Lanham Act. The
Senate Report regarding the Lanham Act repeatedly
references the Act's focus on anti-competitive conduct in
the commercial arena. See S. Rep. No. 1333, 79th Cong., 2d
Sess. (1946), reprinted in 1946 U.S.C.C.A.N. 1274, 1275
("There is no essential difference between trade-mark
infringement and what is loosely called unfair
competition."); id. (goal of Lanham Act is "to foster fair
competition, and to secure to the business community the
advantages of reputation and good will by preventing their
diversion from those who have created them to those who
have not"). The legislative history accompanying the 1988
revisions to the Lanham Act further emphasizes the Act's
focus on commercial, anti-competitive conduct. See S. Rep.
No. 100-515, 100th Cong., 2d Sess., reprinted in 1988
U.S.C.C.A.N. 5577, 5604 (May 12, 1988) (characterizing
"competition between the parties" as a "traditional
trademark infringement question[ ]"); id. at 5603 (identifying
deterrence of acts of "unfair competition" as goal of Lanham
Act). Our case law also recognizes the essentially
commercial nature of the Lanham Act. Granite State Ins.
Co. v. AAMCO Transmissions, Inc., 57 F.3d 316, 321 (3d
Cir. 1995) (focus of the statute is on "commercial interests
[that] have been harmed by a competitor's false
advertising.") (emphasis in original).
In enacting the Lanham Act in 1946, Congress sought to
bring together various statutes regarding trademark
protection that previously had been scattered throughout
the United States Code. See id. at 1275-76 ("There are
many reasons why there should be a new trade-mark
statute. . . . [Trademark statutes have] been amended from
time to time and supplemented by the act of March 19,
1920, which has also been amended in several particulars.
The result is a confused situation. . . . It seems desirable to
collect these various statutes and have them in a single
enactment."). Nothing in the Lanham Act's legislative
14
history evidences an intent to work a major change in the
class of plaintiffs entitled to sue for damages. See id. at
1275 ("The present act is substantially the act of February
20, 1905."); S. Rep. No. 100-515, 100th Cong., 2d Sess.,
reprinted in 1988 U.S.C.C.A.N. 5577, 5604 (May 12, 1988)
(language regarding standing to bring action under S 43(a)
unchanged by 1988 amendments).
Earlier trademark statutes defined the class of eligible
plaintiffs narrowly and in keeping with the goal of federal
trademark law to protect good will. See S 7 of 1881 Act, 21
Stat. 502, 504, 46th Cong., 3d Sess. (Mar. 3, 1881)
(limiting right to sue to "owners" of trademark); S 16 of
1905 Act, 33 Stat. 724, 728, 58th Cong., 3d Sess. (Feb. 20,
1905) (same); S 4 of 1920 Act, 41 Stat. 533, 534, 66th
Cong., 2d Sess. (Mar. 19, 1920) (same). In addition, these
earlier acts were drafted against the backdrop of common
law doctrine similar to today's prudential standing doctrine
that limited the eligible plaintiff class. See Inwood Lab., Inc.
v. Ives Lab., Inc., 456 U.S. 844, 102 S. Ct. 2182, 72
L.Ed.2d 606 (1982) ("purpose of the Lanham Act was to
codify and unify the common law of unfair competition and
trademark protection"); see also Bonito Boats, Inc. v.
Thunder Craft Boats, Inc., 489 U.S. 141, 109 S. Ct. 971,
103 L.Ed.2d 118 (1989) ("law of unfair competition has its
roots in the common-law tort of deceit"); see generally 1
J.T. McCarthy, McCarthy on Trademarks and Unfair
Competition S 5:2 (4th ed. 1996) (discussing common-law
origins of Lanham Act). There is no indication that
Congress intended in any of the Lanham Act's statutory
precursors, or in the Lanham Act itself for that matter, to
abrogate the common law limitations on standing to sue.
Cf. Associated General, 459 U.S. at 531-34 (describing
congressional intent to incorporate common-law principles
constraining class of plaintiffs entitled to sue under Clayton
Act).
In light of the text of S 43(a), other textual provisions
defining the purpose of the Lanham Act, the Lanham Act's
legislative history and its common-law origins, we hold that
Congress did not intend to abrogate prudential limitations
on the standing of plaintiffs to bring suit under S 43(a).
15
C.
Our previous opinions analyzing standing under S 43(a)
have assumed, without undergoing the analysis prescribed
by Supreme Court cases such as Bennett, that prudential
standing doctrine limits the class of plaintiffs entitled to
bring suit. In Thorn v. Reliance Van Co., 736 F.2d 929 (3d
Cir. 1984), we first addressed S 43(a)'s standing
requirements.4 The issue there was whether an individual
investor in a bankrupt company had standing to sue for
allegedly false advertisements by a competitor of the
bankrupt company. Thorn, 736 F.2d at 931. We looked to
S 43(a)'s plain language and concluded that "it is this
court's function to grant standing to Thorn if he is a person
who believes that he has been damaged by [the defendant's]
use of false representations." Id. at 932. Because the
investor alleged with specificity both "a section 43(a)
violation and a resulting injury," we concluded that "the
mere fact that Thorn [was] not a competitor of [the
defendant] d[id] not, in and of itself, preclude him from
bringing suit under section 43(a)." Id. at 933. Though we
thus concluded that the plaintiff had satisfied
constitutional standing prerequisites, we went on to
consider whether "there [we]re any prudential reasons
which support a judicial determination that Thorn[was]
without standing . . . ." Id. We defined the "dispositive
question" of a party's prudential standing as "whether the
party has a reasonable interest to be protected against false
advertising." Id. (quoting Smith v. Montoro, 648 F.2d 602,
608 (9th Cir. 1981) (quoting 1 R. Callmann, Unfair
Competition, Trademarks and Monopolies, S 18.2(b) at 625
(3d ed. 1967))). While we never precisely defined the critical
term "reasonable interest," we noted that Thorn's
_________________________________________________________________
4. Though S 43(a) was modified after the Thorn decision, the operative
language defining the class of persons entitled to bring a private
damages action has not undergone substantive change. See Thorn, 736
F.2d at 931 (quoting the then-existing S 43(a): "Section 43(a) provides
that an action may be brought `by any person doing business in the
locality falsely indicated as that of origin or in the region in which
said
locality is situated, or by any person who believes that he is or is
likely
to be damaged by the use of any such false description or
representation.' ").
16
allegations of injury -- notably the loss of his investment
due to the defendant's false advertising campaign-- were
"sufficient[ly] direct" to satisfy any prudential standing
considerations. Id.
Our subsequent decisions have carried forward this
prudential "reasonable interest" requirement and have
grappled with defining the term with greater precision. We
revisited the issue of standing under S 43(a) in Serbin v.
Ziebart Int'l Corp., 11 F.3d 1163 (3d Cir. 1993). In that
case, the issue was whether a consumer whose purchase
was allegedly influenced by false advertising had standing
under the Lanham Act to bring a suit for damages. We held
that consumers lack standing to bring false advertising
claims under the Lanham Act, and we reaffirmed the
principle announced in Thorn that, the plain language of
S 43(a) notwithstanding, prudential concerns dictate that a
sufficiently direct injury be alleged before standing to sue is
recognized:
The "sufficient direct injury" alleged by Thorn was that
his investment in Florida-Eastern was destroyed by the
misconduct of one of Florida-Eastern's chief
competitors. Thus, this Court's determination that the
plaintiff in Thorn had a "reasonable interest to be
protected under section 43(a)" permitted a false
advertising suit by one who, while not in his own
person a competitor of the alleged rogue enterprise,
was, nonetheless, so situated that he could quite
reasonably be regarded as a surrogate for such
competitor.
Serbin, 11 F.3d at 1175 (emphasis added). We fleshed out
the concept of "reasonable interest" by quoting extensively
from the Callmann treatise relied upon in Thorn in
formulating our "reasonable interest" requirement:
The language of the Lanham Act . . . states that the
wrongdoer in cases of false advertising is "liable to a
civil action . . . by any person who believes that he is
or is likely to be damaged by the use of any such false
description or representation." Indeed the statute goes
further in recognizing that the plaintiff need not even
be "in the same line of business and in competition
17
with defendant"; it will be sufficient, in the case of a
false designation of origin, that the plaintiff is "doing
business in the locality falsely indicated"5 and in the
case of a false description of goods or services, that he
believes he is or is likely to be damaged, because, for
instance, the parties are doing business on
different economic levels. The dispositive question
should be whether plaintiff has a reasonable interest to
be protected against false advertising.
Serbin, 11 F.3d at 1176-77 (emphasis added).
The emphasized language, quoted favorably in Serbin,
implies that parties who are not in direct competition
(because they are "doing business on different economic
levels") nevertheless may have standing to sue if they have
a "reasonable interest to be protected against false
advertising." This language, implicitly adopted in Serbin,
exists in some tension with the District Court's holding that
only direct competitors or their surrogates have standing.
Moreover, the District Court's holding conflicts with cases
from other courts of appeals that confer standing upon
parties who are not direct competitors or "surrogates" for
the same. See generally 4 Thomas J. McCarthy, McCarthy
on Trademarks and Unfair Competition S 27:32 at 27-51
(4th ed. 1996) ("With the possible exception of the Ninth
Circuit, the courts have held that the plaintiff and
defendant need not be in direct competition with each other
for plaintiff to have standing to sue . . . under S 43(a)."); see
also PPX Enters., Inc. v. Audiofidelity, Inc., 746 F.2d 120 (2d
_________________________________________________________________
5. This analysis rests upon an earlier version ofS 43(a), which, unlike
the
present statute enacted in 1992, appeared to create two classes of
parties with standing to sue. The earlier version of the statute provided
that an action could be brought
by any person doing business in the locality falsely indicated as
that
of origin or in the region in which said locality is situated, or
by any
person who believes that he is or is likely to be damaged by the
use
of any such false description or representation.
15 U.S.C. S 1125(a) (1988) (emphasis added). The text of the present
statute, which is quoted earlier in our opinion, does not differentiate
textually between the standing of "false designation" plaintiffs and
others
to bring suit.
18
Cir. 1984) (recognizing standing of owner of royalty streams
from music recording to bring action against distributor of
falsely labeled record albums); Camel Hair & Cashmere
Inst., Inc. v. Associated Dry Goods Corp., 799 F.2d 6 (1st
Cir. 1986) (trade association of makers of cashmere fibers
and fabrics, but not of finished coats, held to have standing
to sue for a preliminary injunction against retailers of coats
falsely labeled as containing more cashmere than they had).6
For this reason, we do not adopt the standard employed by
the District Court in this case as our test for standing
under S 43(a).
As discussed earlier, there exists no single overarching
test for determining the standing to sue under a given
statute. With respect to S 43(a) of the Lanham Act, the
Ninth Circuit jurisprudence in this area suggests one
alternative. Under Ninth Circuit law, the class of persons
entitled to bring suit under S 43(a) depends on what type of
Lanham Act violation is being alleged. For violations of the
"false association" prong of S 43(a), 7 any party with a
"commercial interest in the product wrongfully identified,"
whether in competition with the defendant or not, has
standing to bring a S 43(a) action. Waits v. Frito-Lay, Inc.,
978 F.2d 1093, 1009 (9th Cir. 1992). For violations of the
"false advertising" prong of S 43(a), 8 only parties who allege
a "discernibly competitive injury" have standing. Id. at
1109.
Applying this dichotomous approach, the Ninth Circuit
has held that a plaintiff who alleged his name was replaced
_________________________________________________________________
6. But see L.S. Heath & Son, Inc. v. AT & T Info. Sys., Inc., 9 F.3d 561,
575 (7th Cir. 1993) ("Because Heath is not in the computer business and
thus is not a competitor of AT&T, Heath does not have standing to raise
the false advertising claim."); Stanfield v. Osborne Indus., Inc., 52 F.3d
867, 872 (10th Cir.) ("[T]o have standing for a false advertising claim,
the
plaintiff must be a competitor of the defendant and allege a competitive
injury."), cert. denied, 516 U.S. 920 (1995).
7. A "false association" claim refers to false representations concerning
the origin, association, or endorsement of goods or services through the
wrongful use of another's distinctive mark, name, trade dress, or other
device. Waits v. Frito-Lay, Inc., 978 F.2d 1093, 1108 (9th Cir. 1992).
8. A "false advertising" claim refers to false representations in
advertising
concerning the qualities of goods or services. Waits, 978 F.2d at 1108.
19
with that of another actor had standing to sue the movie's
producer under the "false association" prong even though
he was not in competition with the producer. Smith v.
Montoro, 648 F.2d 602 (9th Cir. 1981). Similarly, a singer
whose distinctive voice was imitated in a commercial was
deemed to have standing under the "false association"
prong of S 43(a) even though he could not allege a
competitive injury vis-a-vis the company that aired the
commercial. Waits, 978 F.2d at 1093. On the other hand,
a movie producer lacked standing under the "false
advertising" prong to bring a S 43(a) suit against various
movie theaters who falsely described the movie as bearing
an "R" rating as opposed to a "PG" rating because the
parties were not competitors. Halicki v. United Artists
Communications, Inc., 812 F.2d 1213 (9th Cir. 1987). The
Seventh Circuit followed the Ninth Circuit in L.S. Heath &
Son, Inc. v. AT & T Info. Sys., Inc., 9 F.3d 561, 575 (7th Cir.
1993) ("Because Heath is not in the computer business and
thus is not a competitor of AT&T, Heath does not have
standing to raise the false advertising claim.").
We reject the Ninth Circuit's approach. Section 43(a)
provides no support for drawing a distinction in standing
depending on the type of S 43(a) violation alleged. The
operative language that provides for standing --"any
person who believes that he or she is or is likely to be
damaged" -- does not purport to distinguish between the
two types of actions available under S 43(a). We also note
that the Ninth Circuit's approach has been the subject of
criticism in subsequent cases and in scholarly commentary.
See, e.g., Guarino v. Sun Co., Inc., 819 F. Supp. 405, 409
(D.N.J. 1993) (declining to follow Ninth Circuit and noting
that the distinction has been rejected by McCarthy); 4 J.
Thomas McCarthy, McCarthy on Trademarks and Unfair
Competition S 27:33, at 27-52 to 27-53 (1998) ("The passe
semantic argument [in Halicki] that there cannot be `unfair
competition' without `competition' between the parties has
often been rejected."); James S. Wrona, False Advertising
and Consumer Standing Under Section 43(a) of the Lanham
Act: Broad Consumer Protection Legislation or a Narrow Pro-
Competitive Measure?, 47 Rutgers L. Rev. 1085, 1136-38
(1995) ("The Ninth Circuit should apply the same criteria
20
when reviewing standing under both section 43(a)
subparts.").
In short, the Ninth Circuit's approach enjoys no textual
support and fragments standing jurisprudence under
S 43(a); accordingly, we decline to adopt the Ninth Circuit's
reasoning.
The test for antitrust standing set forth by the Supreme
Court in Associated Gen. Contractors of California, Inc. v.
California State Council of Carpenters, 459 U.S. 519 (1983),
provides an appropriate method for adding content to our
"reasonable interest" test, and we therefore adopt it as the
test for determining a party's statutory standing under
S 43(a) of the Lanham Act. While we are thefirst court of
appeals to utilize this standing analysis in the context of a
Lanham Act claim, we note that its use has the imprimatur
of two prominent commentators in the area. See 4
McCarthy, McCarthy on Trademarks and Unfair Competition
S 27:32 n.1 (1998) ("In the author's opinion, some limit on
the S 43(a) standing of persons remote from the directly
impacted party should be applied by analogy to antitrust
law, such as use of the criteria listed in Associated General
Contractors, Inc. v. California State Council of Carpenters,
459 U.S. 519 (1983)."); Restatement (Third) Unfair
Competition, S 3, cmt. f (1995) ("In determining whether an
asserted injury is sufficiently direct to justify the imposition
of liability, the Supreme Court's analysis of similar issues
under federal antitrust law may offer a useful analogy.").
In Associated General, the Supreme Court addressed the
standing of plaintiffs to bring a private action for damages
under S 4 of the Clayton Act, which contains language
equally expansive as the standing provisions of the Lanham
Act. 15 U.S.C. S 15 provides, in pertinent part:
Any person who shall be injured in his business or
property by reason of anything forbidden in the
antitrust laws may sue therefor in any district court of
the United States . . . .
The Supreme Court rejected a "literal reading of the
statute," noting that such an interpretation would be
"broad enough to encompass every harm that can be
attributed directly or indirectly to the consequences of an
21
antitrust violation." Associated General, 459 U.S. at 529.
Instead, the Court applied principles of "antitrust standing"
developed by the lower courts and commentators in
determining standing to sue under the Clayton Act. Id. at
535 & n.31 ("Harm to the antitrust plaintiff is sufficient to
satisfy the constitutional standing requirement of injury in
fact, but the court must make a further determination
whether the plaintiff is a proper party to bring a private
antitrust action."). The Court then identified a number of
factors courts should consider in answering this question:
(1) The nature of the plaintiff's alleged injury: Is the
injury "of a type that Congress sought to redress
in providing a private remedy for violations of the
antitrust laws"? Id. at 538.
(2) The directness or indirectness of the asserted
injury. Id. at 540.
(3) The proximity or remoteness of the party to the
alleged injurious conduct. Id. at 542.
(4) The speculativeness of the damages claim. Id.
(5) The risk of duplicative damages or complexity in
apportioning damages. Id. at 543-44.
Weighing these factors, the Supreme Court determined
that a union, which claimed injury due to the anti-
competitive conduct of a multi-employer association with
which the union had negotiated a collective bargaining
agreement, lacked standing to pursue a private action
under the Clayton Act. The union's theory was that the
multi-employer association coerced third parties and
certain of its members to contract with nonunion entities,
thereby restraining the union's business activities. First,
the Court noted that the union was neither a consumer nor
a competitor in the market in which trade was restrained
and that its interests would not necessarily be served or
disserved by enhanced competition in the market. Since the
primary aim of the Clayton Act is to protect economic
freedom in the relevant market, the Court found that the
nature of the plaintiff 's injury was outside the"area of
congressional concern" and therefore weighed against
recognizing standing. Id. at 538-39.
22
Next, the Supreme Court noted that the union's injuries
were only an indirect result of whatever harm may have
been suffered by the parties who were coerced. "The
existence of an identifiable class of persons whose self-
interest would normally motivate them to vindicate the
public interest in antitrust enforcement diminishes the
justification for allowing a more remote party such as the
Union to perform the office of a private attorney general."
Id. at 542.
Finally, the Supreme Court pointed to the indirect nature
of the union's injury as implicating practical concerns of
judicial administration. If remote plaintiffs like the union
were to be permitted to sue for damages, "potential
plaintiffs at each level in the distribution chain would be in
a position to assert conflicting claims to a common fund
. . . thereby creating the danger of multiple liability" on the
one hand or a "massive and complex" damages litigation on
the other. Id. at 544-55. The Supreme Court concluded:
[T]he nature of the Union's injury, the tenuous and
speculative character of the relationship between the
alleged antitrust violation and the Union's alleged
injury, the potential for duplicative recovery or complex
apportionment of damages, and the existence of more
direct victims of the alleged conspiracy [ ] weigh heavily
against judicial enforcement of the Union's antitrust
claim.
Id. at 545.
Applying these same factors to Appellants' Lanham Act
claim similarly weighs against judicial enforcement of this
claim. First, while there may be circumstances in which a
non-competitor may have standing to sue as we noted
earlier, the focus of the Lanham Act is on "commercial
interests [that] have been harmed by a competitor's false
advertising," Granite State Ins. Co. v. AAMCO
Transmissions, Inc., 57 F.3d 316, 321 (3d Cir. 1995)
(emphasis in original), and in "secur[ing] to the business
community the advantages of reputation and good will by
preventing their diversion from those who have created
them to those who have not." S. Rep. No. 1333, 79th Cong.,
2d Sess. (1946), reprinted in 1946 U.S.C.C.A.N. 1274, 1275.
23
While the Appellants have alleged a commercial interest,
they have not alleged competitive harm. Nor is there any
indication that Appellants' good will or reputation have
been harmed directly or indirectly. This is in contrast to
cases like Waits and Camel Hair, in which the plaintiffs'
good will and reputation were impacted by the defendants'
conduct -- in Waits by falsely assuming the plaintiff 's
voice, and in Camel Hair by falsely representing the
characteristics of products marketed by the plaintiffs. As
the District Court stated, "plaintiffs do not allege that
defendants ran advertisements that said `don't buy engine
additive at Conte Brothers or Hi/Tor -- instead, buy Slick
50 directly from the manufacturer.' " Conte Bros., 992 F.
Supp. at 715. The type of injury suffered by Appellants --
loss of sales at the retail level because of alleged false
advertising -- does not impact the Appellants' ability to
compete; nor does it detract from the Appellants' reputation
or good will. Therefore, the alleged harm is not of the "type
that Congress sought to redress" by enacting the Lanham
Act. Associated General, 459 U.S. at 538.
Appellants' remoteness from the allegedly harmful
conduct also weighs against recognizing a right to sue on
these facts. Here, as in Associated General, the "existence
of an identifiable class of persons" -- manufacturers of
competing products -- "whose self-interest would normally
motivate them to vindicate the public interest . . .
diminishes the justification for allowing a more remote
party . . . to perform the office of a private attorney
general." Associated General, 516 U.S. at 542. Indeed, our
decision in Serbin, in which we held that consumers whose
purchases were influenced by false advertising lacked
standing under S 43(a), involved more directly harmed
plaintiffs than the retailer class in this case.
Furthermore, any damages suffered by Appellants were,
if not speculative, then certainly avoidable. There is no
allegation that Appellants, as retailers, were unable to stock
Slick 50 for resale. If the retailers responded to the
artificially-increased popularity of Slick 50 that allegedly
resulted from the false advertising campaign by stocking
Slick 50, they would not have suffered any damages. As the
District Court recognized, the "interest that plaintiffs had in
24
preserving the reputation of motor oil and other competitors
of Slick 50 appears to be a theoretical, rather than actual
economic interest." Conte Bros., 992 F. Supp. at 715-16.
This is in contrast to the concrete and unavoidable nature
of the injury suffered by Quaker State's competitors who
cannot reasonably be expected to retool their factory
operations to meet the artificially-buoyed demand for Slick
50.
Finally, recognizing the right of every potentially injured
party in the distribution chain to bring a private damages
action would subject defendant firms to multiple liability for
the same conduct and would result in administratively
complex damages proceedings. Additionally, such a holding
could result in an enormous number of relatively
insignificant cases being litigated in the federal courts. If
every retailer had a cause of action for false advertising
regardless of the amount in controversy, regardless of any
impact on the retailer's ability to compete, regardless of any
impact on the retailer's good will or reputation, and
regardless of the remote nature of the injury suffered, the
impact on the federal courts could be significant. For
example, under Appellants' theory, every corner grocer in
America alleging that his sales of one brand of chocolate
bars have fallen could bring a federal action against the
manufacturer of another brand for falsely representing the
chocolate content of its product. Such an action hardly
seems befitting of a statute that was designed primarily to
resurrect the federal tort of unfair competition after it was
consigned to the post-Erie ashheap. See 4 J. Thomas
McCarthy, McCarthy on Trademarks and Unfair Competition
S 27:7 at 27-12 (Lanham Act drafted in part as "a reaction
to the 1938 Erie Railroad Supreme Court decision, which it
was widely felt, had eliminated the existing body of federal
unfair competition common law.").
D.
In the alternative, the Appellants argue that they have
sufficiently alleged a directly competitive relationship to
withstand a motion to dismiss. They point to the following
allegation in their Complaint:
25
Slick 50 products are sold to major national retailers
directly and through independent distributors. Direct
sales are made to national and regional chain stores, to
fast lube centers and to resellers and end users in
large metropolitan areas.
Compl. P 19; A16. The District Court concluded that this
allegation, while not entirely without ambiguity, generally
described Slick 50's distribution pattern and could not
reasonably be construed as alleging that Quaker State
directly distributed products to end users. Conte Bros., 992
F. Supp. at 714. The District Court also noted that any
ambiguity as to the meaning of the scope of this allegation
was resolved by admissions in the plaintiffs' brief that the
parties are not direct competitors. Id.; see also Glick v.
White Motor Co., 458 F.2d 1287, 1291 (3d Cir. 1972)
("Judicial admissions are binding for the purpose of the
case in which the admissions are made including appeals,
and . . . an admission of counsel during the course of trial
is binding on his client.").
Our conclusion would not be altered even if we were to
assume some percentage of Slick 50's sales were made
directly to end users and that the parties, therefore, were
"competitors" in some limited sense. Under the reasoning
we adopt today, standing under the Lanham Act does not
turn on the label placed on the relationship between the
parties. Given the existence of more directly injured parties,
the tenuousness of Appellants' damages claims, and the
possibility of multiple recoveries, we would not be inclined
to revisit our conclusion that the Appellants lack standing
even if we assumed a nominally competitive relationship.
In any event, Appellants clearly admitted in their District
Court brief that the parties are not in direct competition,
see Supp. App. 96 (Pls.' Br. in Opp. to Defs.' Mot. to
Dismiss at 5 n.1) ("Plaintiffs are not in direct competition
with Defendants"), and their alternative argument is
therefore foreclosed on the grounds stated by the District
Court.
III.
Expanding standing to parties such as Appellants would
result in a great increase in marginal litigation in the
26
federal courts and would not serve the underlying purposes
of the Lanham Act -- to ferret out unfair competitive
methods and protect businesses from the unjust erosion of
their good will and reputation. The test we adopt today,
which was originally announced in Associated General in
the context of standing under the Clayton Act, provides
appropriate flexibility in application to address factually
disparate scenarios that may arise in the future, while at
the same time supplying a principled means for addressing
standing under both prongs of S 43(a).
Applying those principles, we reach the same conclusion
as did the District Court: the Appellants lack standing
under S 43(a) of the Lanham Act. Accordingly, we affirm the
judgment of the District Court dismissing this case and tax
costs against the Appellants.
A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit
27
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} |
488 So.2d 198 (1986)
STATE of Louisiana
v.
Scott Lee BROWN.
No. 86-K-0533.
Supreme Court of Louisiana.
May 12, 1986.
Denied.
| {
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818 F.2d 863
*Ole London Townev.Mony
86-3882
United States Court of Appeals,Fifth Circuit.
4/29/87
1
M.D.La.
AFFIRMED
2
---------------
* Fed.R.App.P. 34(a); 5th Cir.R. 34.2.
| {
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896 F.2d 552
Castanedav.Ramos*
NO. 89-2782
United States Court of Appeals,Fifth Circuit.
FEB 06, 1990
1
Appeal From: S.D.Tex.
2
DISMISSED.
*
Fed.R.App.P. 34(a); 5th Cir.R. 34.2
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996 So.2d 67 (2008)
Jennifer THIBODEAUX
v.
Bill COMEAUX, et al.
No. 2008-0314.
Court of Appeal of Louisiana, Third Circuit.
October 1, 2008.
*68 John M. Jefcoat, Michael L. Barras, Galloway Jefcoat, L.L.P., Lafayette, LA, for Plaintiff/Appellant: Jennifer Thibodeaux.
L. Lane Roy, Dawn L. Morris, Kathy A. Rito, Preis & Roy, Lafayette, LA, for Defendant/Appellee: State of Louisiana through the Department of Transportation.
Court composed of JIMMIE C. PETERS, ELIZABETH A. PICKETT and JAMES T. GENOVESE, Judges.
PETERS, J.
The plaintiff, Jennifer Thibodeaux, appeals the trial court's grant of a summary judgment in favor of one of the defendants in her suit for damages, the State of Louisiana, through the Department of Transportation and Development (DOTD), dismissing it from the suit. For the following reasons, we deny DOTD's motion to dismiss the appeal, reverse the trial court judgment, and remand the matter to the trial court for further proceedings.
DISCUSSION OF THE RECORD
This litigation arises from a May 23, 2001 automobile accident which occurred on U.S. Highway 190 in St. Landry Parish, Louisiana. A vehicle driven by Jennifer Thibodeaux was struck by another vehicle and forced from the highway into a construction zone, where it struck a pile of debris. At some point during the accident, Ms. Thibodeaux was ejected from her vehicle.
On July 26, 2001, Ms. Thibodeaux brought suit against a number of defendants, including DOTD, to recover for the damages she sustained in the accident. While the record now before us asserts various theories of recovery against the named defendants, with regard to DOTD's fault, Ms. Thibodeaux has alleged that her injuries were caused by its "wanton gross negligence" in
1) Not properly maintaining the road by failing to remove debris including but not limited to a block of cement and tractor tire.
2) Not properly maintaining a construction zone;
3) Not providing a safe place for vehicles exiting the roadway.
*69 In its answer to Ms. Thibodeaux's petition, DOTD denied any fault in causing the accident and asserted that Ms. Thibodeaux's injuries were caused by the combined fault of the drivers of the vehicles involved.
The appeal now before us arises from a motion for summary judgment filed by DOTD on August 22, 2007. After an October 15, 2007 hearing, the trial court granted the motion and dismissed DOTD from the litigation. Ms. Thibodeaux's complaint on appeal is that the trial court decided the motion for summary judgment, not on DOTD's August 22, 2007 filing, but on an argument first raised by DOTD four days before the October 15, 2007 hearing, and not on a pleading addressed to the motion for summary judgment, but on a reply brief filed in response to her arguments in opposition to the motion. Ms. Thibodeaux argues on appeal that the trial court erred in granting relief to DOTD based on this late filing. We agree.
The pertinent dates in considering the issue raised in this appeal are as follows:
August 22, 2007 DOTD filed its original motion for summary judgment.
September 20, 2007 Ms. Thibodeaux filed her response to DOTD's motion.
October 11, 2007 DOTD filed a response to Ms. Thibodeaux's response.
October 15, 2007 The trial court heard DOTD's motion for summary judgment.
DOTD's August 22, 2007 motion for summary judgment reads as follows:
NOW INTO COURT, through undersigned counsel, comes State of Louisiana through the Department of Transportation, who moves this Court pursuant to Louisiana Code of Civil Procedure article 966 for Summary Judgment adverse to Jennifer Thibodeaux and at Plaintiff's sole cost for the reasons more fully set forth in the attached Exhibits and Memorandum.
As set forth in the memorandum that DOTD attached to its motion for summary judgment, the only basis for its request for relief was that the debris Ms. Thibodeaux claims she struck in the accident was located outside of DOTD's right of way and, therefore, not in its custody and control at the time of the accident. In support of its position, DOTD filed a memorandum and two affidavits. One of the affidavits is that of Ms. Thibodeaux's counsel of record, who had filed a statement wherein he attempted to set forth the uncontested facts in the litigation. This was executed by Ms. Thibodeaux's counsel on February 15, 2007, and filed in the record the next day. The timing of the filing suggests that it was intended to address pleadings filed against Ms. Thibodeaux by other defendants. The second affidavit filed by DOTD is that of Thomas Landry, its construction engineer for the district in which the accident occurred. That affidavit is dated May 16, 2007.
Ms. Thibodeaux responded to DOTD's motion by filing a memorandum in opposition to the motion and attaching the deposition of Ronald Ardoin, an employee of Gilchrist Construction, another defendant in the litigation; the deposition of Thomas Landry; and the report of V.O. Tekell, Jr., a professional engineer.
Thus, the initial issue upon which DOTD sought relief was that of custody and control of the debris pile which Ms. Thibodeaux's vehicle struck. However, on October 11, 2007, DOTD filed a pleading which it titled "REPLY/SUPPLEMENTAL MEMORANDUM WITH REGARDS TO DOTD'S MOTION FOR SUMMARY JUDGMENT" wherein it asserted for the first time that custody and control of the debris pile was irrelevant because Ms. Thibodeaux *70 had been ejected from her vehicle before it hit the debris pile. DOTD's support for this position was the April 12, 2007 deposition testimony of Stephen Killingsworth, Ms. Thibodeaux's own expert witness. In his deposition Mr. Killingsworth testified as follows:
At that point before the vehicle completely clears the ditch and gets over on the side because she's not going to come out to the driver's side, it's laying on the driver's side. As it catches and rotates sideways, in other words, she hits that first impact and then she catches, the car hasn't gotten to the mound yet, can't get to the mound yet. So before it ever gets check this, before the driver's side catches the concrete on the mound she's out of the vehicle, which says that the seat belt fractured before she hits the concrete. This is the only way she's going to get out of the vehicle and be on the road side of the ditch.
Mr. Killingsworth further stated that
we know that she gets ejected on the road side of the ditch, she winds up on the road side of the ditch, there's no other whipping action that's going to get her out of the vehicle other than, again, it's trying to rotate clockwise, that's what's going to pitch her out, and, again, it ties into what I'm talking about in terms of the buckle itself.
Thus, he was of the opinion that the seat belt failure occurred between the ditch and the debris.
At the hearing on the motion, DOTD's counsel first acknowledged that the custody and control issue was somewhat confusing, and almost immediately began arguing Mr. Killingsworth's deposition testimony as the basis of its motion for summary judgment. Immediately upon being called upon to make his argument, Ms. Thibodeaux's counsel objected to the use of Mr. Killingsworth's deposition as a basis for DOTD's motion for summary judgment. He pointed out to the court that it was filed five days before the hearing, and that he was unable to contact Mr. Killingsworth or anyone else to prepare a response, given the short period of time. The trial court implicitly overruled the objection by granting the summary judgment. In doing so, the trial court stated that "[t]he bigger problem I have, I guess, is the use of the term `maintenance' in the right-of-way, but I really don't have any dispute before me at this point in time that she was ejected prior to striking the debris pile, so it's irrelevant." Thus, the trial court recognized the factual conflicts relative to the custody and control issue, and based its decision solely on the assertion that Ms. Thibodeaux was ejected from the vehicle before it hit the debris pile.
OPINION
Louisiana Code of Civil Procedure Article 966(B) provides that "[t]he motion for summary judgment and supporting affidavits shall be served at least fifteen days before the time specified for the hearing." (Emphasis added.) That same article also provides that if the adverse party chooses to respond with a memorandum or opposing affidavits, they "shall be served pursuant to Article 1313 at least eight days prior to the date of the hearing unless the Rules for Louisiana District Courts provide to the contrary." Id. Uniform Rules District Courts, Rule 9.9 provides in pertinent part:
(a) When a party files an exception or motion, that party must concurrently furnish the trial judge and serve on all other parties a supporting memorandum that cites both the relevant facts and applicable law. The memorandum must be served on all other parties so that it is received by the other parties at least *71 15 calendar days before the hearing, unless the court sets a shorter time.
(b) A party who opposes an exception or motion must concurrently furnish the trial judge and serve on all other parties an opposition memorandum at least eight calendar days before the scheduled hearing. The opposition memorandum must be served on all other parties so that it is received by the other parties at least eight calendar days before the hearing, unless the court sets a shorter time.
(c) The mover or exceptor may furnish the trial judge a reply memorandum, but only if the reply memorandum is furnished to the trial judge and served on all other parties so that it is received before 4:00 p.m. on a day that allows one full working day before the hearing. For example, if the hearing is set for Friday, the reply memorandum must be received no later than 4:00 p.m. the preceding Wednesday. If the hearing is set for Monday, the reply memorandum must be received no later than 4:00 p.m. the preceding Thursday.
(d) Parties who fail to comply with paragraphs (a) and (b) of this rule may forfeit the privilege of oral argument. If a party fails to timely serve a memorandum, thus necessitating a continuance to give the opposing side a fair chance to respond, the court may order the late-filing party to pay the opposing side's costs incurred on account of untimeliness.
This rule applies to motions for summary judgments. Uniform Rules District Courts, Rule 9.10(1).
There is no dispute but that DOTD's original motion for summary judgment and Ms. Thibodeaux's response complied with the deadlines set forth in La.Code Civ.P. art. 966(B) and Uniform Rules District Courts, Rule 9.9. Whether DOTD's October 11, 2007 filing complies with these deadlines depends on how one classifies that filing. If it is in fact a reply memorandum, it complies. If it is a new motion for summary judgment, it does not. We find that it is clearly a new motion for summary judgment.
The bases for DOTD's original motion for summary judgment, as set forth in its memorandum, were that the debris was not in DOTD's custody or control at the time of the accident; that DOTD had no knowledge of the debris; and that the debris was not within DOTD's right-of-way. DOTD did not argue that Ms. Thibodeaux was thrown from her car before it made contact with the debris pile; it asserted that Ms. Thibodeaux was injured after striking the debris.[1]
DOTD's October 11, 2007 filing directly contradicted its prior statements of uncontested fact and introduced an entirely new basis for summary judgment: that Ms. Thibodeaux was thrown from her car before it made contact with the debris. DOTD's late filing can be construed as *72 nothing less than an attempt to circumvent the time afforded Ms. Thibodeaux to respond to a completely new issue. Her objection had merit and should have been sustained.
DOTD filed with this court a motion to dismiss Ms. Thibodeaux's appeal, asserting that "the issue [she] raises before this court was not preserved for appeal." DOTD contends that Ms. Thibodeaux's appeal seeks a continuance of the hearing, but that Ms. Thibodeaux never requested a continuance at the trial court. This argument mischaracterizes Ms. Thibodeaux's claims on appeal. As explained above, Ms. Thibodeaux's objection was to DOTD's untimely assertion of a new motion for summary judgment. Accordingly, we deny DOTD's motion to dismiss the appeal.
DISPOSITION
For the foregoing reasons, we deny DOTD's motion to dismiss the appeal and reverse the trial court's grant of summary judgment dismissing the State of Louisiana, through the Department of Transportation and Development as a defendant in the lawsuit filed by Jennifer Thibodeaux. We assess all costs of this appeal to the State of Louisiana, through the Department of Transportation and Development. Pursuant to the requirement of La.R.S. 13:5112(A), we set those costs in the monetary amount of $2,135.50.
MOTION TO DISMISS APPEAL DENIED, REVERSED AND REMANDED.
NOTES
[1] On February 15, 2007, Ms. Thibodeaux's counsel of record executed an affidavit that contained fourteen numbered paragraphs setting forth certain uncontested material facts in the litigation. DOTD accepted these facts as uncontested when it relied on the affidavit. In the fifth paragraph, Ms. Thibodeaux's counsel made the following statement: "The vehicle struck a tractor tire and a piece of cement and at that time the Sentra became airborne and rolled ejecting Jennifer Thibodeaux." DOTD did not stop with accepting this assertion of fact alone. In the memorandum DOTD attached to its motion for summary judgment, it set out sixteen numbered paragraphs which it described as its own statement of uncontested facts. In those sixteen paragraphs, DOTD restated the facts set out in the affidavit of Ms. Thibodeaux's counsel and added the factual assertion that "[u]pon striking the concrete and tire, the driver's seatbelt on the Nissan failed, allowing Ms. Thibodeaux to be ejected from the vehicle."
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FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
IN RE CLIFFORD ALLEN BRACE, No. 17-60032
JR.,
Debtor, BAP No.
16-1041
CLIFFORD ALLEN BRACE, JR.,
Individually and as the Trustee ORDER
of the Crescent Trust dated CERTIFYING
July 30, 2004; AHN N. BRACE, QUESTION TO THE
Individually and as the Trustee SUPREME COURT
of the Crescent Trust dated OF CALIFORNIA
July 30, 2004,
Appellants,
v.
STEVEN M. SPEIER, Chapter 7
Trustee,
Appellee.
2 IN RE BRACE
Filed November 8, 2018
Before: Consuelo M. Callahan and Jacqueline Nguyen,
Circuit Judges, and David A. Ezra, * District Judge.
Order
SUMMARY **
Certified Question
In a bankruptcy case, the panel certified the following
question to the Supreme Court of California:
Does the form of title presumption set forth
in section 662 of the California Evidence
Code overcome the community property
presumption set forth in section 760 of the
California Family Code in Chapter 7
bankruptcy cases where: (1) the debtor husband
and non-debtor wife acquire property from a
third party as joint tenants; (2) the deed to
that property conveys the property at issue to
the debtor husband and non-debtor wife as
joint tenants; and (3) the interests of the
*
The Honorable David A. Ezra, United States District Judge for the
District of Hawaii, sitting by designation.
**
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
IN RE BRACE 3
debtor and non-debtor spouse are aligned
against the trustee of the bankruptcy estate?
The panel withdrew the case from submission and
directed the Clerk to administratively close the docket,
pending further order.
ORDER
We respectfully ask the Supreme Court of California to
exercise its discretion to decide the certified question set
forth in Part II of this Order, below. See Cal. R. Ct. 8.548.
The answer to this question of California law will be
dispositive of the appeal before us, and no clear controlling
California precedent exists. Id. Moreover, because the
question that we certify is of great importance to many
debtors and creditors in California, considerations of comity
and federalism suggest that the court of last resort in
California, rather than our court, should have the opportunity
to answer the question in the first instance. See Kilby v. CVS
Pharmacy, Inc., 739 F.3d 1192, 1196–97 (9th Cir. 2013);
Klein v. United States, 537 F.3d 1027, 1028 (9th Cir. 2008).
I. Administrative Information
We provide the following information as required by
California Rule of Court 8.548(b)(1):
The title of this case is: CLIFFORD ALLEN BRACE,
Jr., individually and as the Trustee of the Crescent Trust
dated July 30, 2004, and AHN N. BRACE, individually and
as the Trustee of the Crescent Trust dated July 30, 2004,
Appellants v. STEVEN M. SPEIER, Chapter 7 Trustee,
Appellee (In re: CLIFFORD ALLEN BRACE, Jr.).
4 IN RE BRACE
The case number in our court is: 17-60032.
The names and addresses of counsel are: for Appellants,
William Derek May, Law Office of W. Derek May,
400 North Mountain Avenue, Suite 215b, Upland, CA
91786, and Stephen R. Wade, Law Offices of Stephen R.
Wade, P.C., 350 W. 4th Street Claremont, CA 91711; for
Appellee, Matthew W. Grimshaw, D. Edward Hays, and
Judith E. Marshack, Marshack Hays LLP, 870 Roosevelt
Avenue, Irvine, CA 92620; for Amicus Curiae the National
Association of Consumer Bankruptcy Attorneys and the
National Consumer Bankruptcy Rights Center, Tara
Twomey, the National Consumer Bankruptcy Rights Center,
1501 The Alameda, Suite 200, San Jose, CA 95126, and
Wayne A. Silver, Law Office of Wayne A. Silver, 643 Bair
Island Rd., Suite 403, Redwood City, CA 94063.
II. Certified Question
We request a decision by the Supreme Court of
California on the following question that is now before us:
Does the form of title presumption set forth
in section 662 of the California Evidence
Code overcome the community property
presumption set forth in section 760 of the
California Family Code in Chapter 7
bankruptcy cases where: (1) the debtor
husband and non-debtor wife acquire
property from a third party as joint tenants;
(2) the deed to that property conveys the
property at issue to the debtor husband and
non-debtor wife as joint tenants; and (3) the
interests of the debtor and non-debtor spouse
are aligned against the trustee of the
bankruptcy estate?
IN RE BRACE 5
Our phrasing of the question should not restrict the
Supreme Court of California’s consideration of the issues
involved; that court may reformulate the question. Cal. R.
Ct. 8.548(f)(5).
We agree to accept and to follow the decision of the
Supreme Court of California, as we are required by both
California Rule of Court 8.548(b)(2) and our own precedent.
See Klein, 537 F.3d at 1029.
III. Statement of Facts
Appellants, Clifford and Ahn Brace, have been married
since 1972. Around 1977 or 1978, Appellants acquired their
residence located at 470 E. Crescent Avenue in Redlands,
California (the “Redlands Property”). Sometime before
bankruptcy, Appellants also acquired a rental property
located at 4250 N. F Street in San Bernardino, California (the
“San Bernardino Property”) (collectively, the “Properties”)
and a parcel of land located in Mohave, Arizona (the
“Mohave Property”). 1 Appellants took title to each property
as “husband and wife as joint tenants.”
On July 30, 2004, Mr. Brace (“Debtor”) formed the
Crescent Trust, an irrevocable trust, which designated Mrs.
Brace as the sole beneficiary and Debtor as the sole trustee.
The Crescent Trust document was never recorded. A few
months later, in August 2004, Debtor executed and recorded
trust transfer deeds that transferred his interests in the
Redlands and San Bernardino Properties into the Crescent
Trust for no consideration. At the time of the transfers,
1
On appeal, Appellants do not challenge the characterization of the
Mohave Property. Therefore, we address the characterizations of only
the Redlands and San Bernardino Properties.
6 IN RE BRACE
Debtor was a defendant in a civil action in state court. Two
weeks after Debtor transferred the Properties into the Trust,
a default judgment was entered against him.
On May 16, 2011, Debtor filed a voluntary petition under
Chapter 7 of the Bankruptcy Code, and Robert L. Goodrich
was appointed Chapter 7 Trustee. 2 In December 2011, the
Trustee filed an adversary proceeding against Appellants,
individually and in their capacities as trustees of the Crescent
Trust, 3 seeking: (1) a declaration that the Properties were
property of the bankruptcy estate; (2) a judgment quieting
title to the Properties in the bankruptcy estate; (3) turnover
of any of the Properties determined to be property of the
bankruptcy estate; (4) avoidance and recovery of Debtor’s
transfers of the Properties into the Crescent Trust as actually
or constructively fraudulent transfers under the California
Uniform Fraudulent Transfer Act (the “CUFTA”), Cal. Civ.
Code § 3439.04(a); and (5) revocation of Debtor’s discharge
under 11 U.S.C. § 727(d)(1) and (d)(2).
Following the trial, the bankruptcy court ruled in favor
of the Trustee on the actual fraudulent transfer claims,
voided the transfer of the Properties, and held that the
Properties were part of the bankruptcy estate in their
entireties. In so ruling, the bankruptcy court rejected
Appellants’ defense that, many years earlier, they had orally
transmuted the property from community property to
separate property.
2
Goodrich resigned during the bankruptcy court trial and was
replaced by the current Trustee, Steven Speier.
3
Mrs. Brace was not a trustee of the Crescent Trust, and the Trustee
erroneously named her as such in the complaint.
IN RE BRACE 7
After judgment was entered, Appellants timely moved
for reconsideration and to amend the judgment, arguing that
the Properties, as recovered, were not part of the bankruptcy
estate in their entireties. Rather, because Appellants held the
Properties as joint tenants before the transfer, Appellants
argued that they held the Properties as tenants in common
post-transfer. 4 Thus, as separate property, only Debtor’s
one-half interest in each of the Properties should be included
as part of the estate.
The bankruptcy court disagreed. At the hearing on
Appellants’ motion for reconsideration and to amend the
judgment, 5 the bankruptcy court explained that Appellants
acquired the Properties during their marriage and took title
“as husband and wife, as joint tenants”; thus, post-avoidance
of the transfer to the Crescent Trust, Appellants once again
held the Properties as joint tenants. The bankruptcy court
further explained that, under sections 760 6 and 2581 7 of the
4
Specifically, Appellants explained that when Debtor transferred
his one-half interest in each of the Properties to the Crescent Trust, the
respective joint tenancies were severed, and thus Appellants held the
Properties as tenants in common. Appellants later abandoned this
argument at the hearing on the motion for reconsideration and to amend
the judgment.
5
Due to the complexity of the matter, the hearing was divided
between two proceedings, the first of which occurred on November 5,
2015, and the second on December 10, 2015.
6
“Except as otherwise provided by statute, all property, real or
personal, wherever situated, acquired by a married person during the
marriage while domiciled in this state is community property.” Cal.
Fam. Code § 760.
7
Section 2581 of the Family Code states, in relevant part:
8 IN RE BRACE
California Family Code, the characterization of property in
the deed is irrelevant. Accordingly, it determined that the
Properties were community property and therefore property
of the bankruptcy estate in their entireties.
In the interest of clarity, the bankruptcy court amended
the judgment, finding that:
although these properties are returned to joint
tenancy between the Debtor and Defendant
Ahn Brace, the properties were acquired by
the Debtor and Ahn Brace during the
marriage with community assets and they
presumptively constitute community
property under applicable law. Defendants
failed to establish that the Redlands Property,
San Bernardino Property, or [Mohave]
Property were not community in nature and,
therefore they constitute property of the
Estate pursuant to 11 U.S.C. § 541 and are
subject to administration by the Estate.
Appellants timely appealed the bankruptcy court’s
amended judgment to the Ninth Circuit Bankruptcy
Appellate Panel (the “BAP”). In an unpublished
memorandum disposition, the BAP affirmed the bankruptcy
court’s decision on the CUFTA claims and avoidance of the
Crescent Trust. This issue is not on appeal. In a separate
published opinion, the BAP affirmed the bankruptcy court’s
For the purpose of division of property on dissolution
of marriage or legal separation of the parties, property
acquired by the parties during marriage in joint form,
including property held in tenancy in common, joint
tenancy, or tenancy by the entirety, or as community
property, is presumed to be community property.
IN RE BRACE 9
amended judgment that the Properties were part of the
bankruptcy estate in their entireties. Specifically, the BAP
determined that the community property presumption
applied in the bankruptcy context, Appellants had failed to
overcome the presumption that the Properties were
community property, and therefore the Properties, in their
entireties, were part of the bankruptcy estate. Appellants
timely appealed to this court.
The primary issue on appeal is whether the bankruptcy
court erred in characterizing the Properties as community
property, irrespective of the fact that Appellants held title to
the Properties as joint tenants, and therefore erred in
determining the Properties were part of the bankruptcy
estate. Resolution of this issue turns on whether, in a
bankruptcy proceeding, the community property
presumption can be overcome with evidence that the debtor
and non-debtor spouse hold title to the property at issue as
joint tenants where there is no underlying marital dissolution
proceeding and the interests of the debtor and non-debtor
spouse are not opposed.
IV. Explanation for Request for Decision
A Chapter 7 bankruptcy petition creates an estate to
satisfy creditors’ claims. Under the Bankruptcy Code, the
bankruptcy estate generally includes “[a]ll interests of the
debtor and the debtor’s spouse in community property” at
the time the bankruptcy case is filed. 11 U.S.C. § 541(a)(2).
While the Bankruptcy Code specifies that community
property is part of the bankruptcy estate, it does not address
“the threshold questions of the existence and scope of the
debtor’s interest in a given asset.” In re Mantle, 153 F.3d
1082, 1084 (9th Cir. 1998) (quoting In re Farmers Markets,
Inc., 792 F.2d 1400, 1402 (9th Cir. 1986)). Instead,
bankruptcy courts are required to look to state law—in this
10 IN RE BRACE
case, California law—to determine whether property is
community property and therefore included in the
bankruptcy estate. Id. at 1084; see also Butner v. United
States, 440 U.S. 48, 54 (1979) (“Congress has generally left
the determination of property rights in the assets of a
bankrupt’s estate to state law.”); In re Reed, 940 F.2d 1317,
1332 (9th Cir. 1991).
California is a community property state, which
characterizes marital property as either community or
separate property. See Cal. Fam. Code § 760; In re Marriage
of Benson, 116 P.3d 1152, 1155 (Cal. 2005). 8 In California,
classification of property as community or separate property
depends on the time of its acquisition. See v. See, 415 P.2d
776, 779 (Cal. 1966) (“The character of property as separate
or community is determined at the time of its acquisition.”).
“Property that a spouse acquired before the marriage is that
spouse’s separate property.” In re Marriage of Valli,
324 P.3d 274, 276 (Cal. 2014); see also Cal. Fam. Code
§ 770(a)(1). Property that a spouse acquired during the
marriage is community property, “[e]xcept as provided by
statute.” Cal. Fam. Code § 760; see also Valli, 324 P.3d at
276.
The characterization of the property interest in the
bankruptcy context is crucial and determines the outcome of
this appeal. Under California law, if the property at issue is
held in joint tenancy, only the debtor’s one-half joint interest
becomes part of the bankruptcy estate. See Reed, 940 F.2d
at 1332; In re Obedian, 546 B.R. 409, 412 (Bankr. C.D. Cal.
2016). In a Chapter 7 bankruptcy case, the trustee is
8
“Spouses may hold property as joint tenants or tenants in common,
or as community property, or as community property with a right of
survivorship.” Cal. Fam. Code § 750.
IN RE BRACE 11
permitted, under certain circumstances, to sell the jointly
held property and apportion the proceeds accordingly
between the bankruptcy estate and the non-debtor joint
owners. See 11 U.S.C. § 363(h), (j). However, if the
property at issue is community property, the property
becomes part of the bankruptcy estate in its entirety. Mantle,
153 F.3d at 1084. In that scenario, the trustee is permitted,
under the Bankruptcy Code, to sell the property and
distribute all sales proceeds to the debtor’s creditors, rather
than apportioning some of the proceeds to the non-debtor
spouse. See 11 U.S.C. § 541(a)(2). The certified question
addresses the interplay between federal bankruptcy law and
state law property characterization.
Under California law, there is a general presumption
that, absent a statute to the contrary, all property acquired
during marriage is community property. See Valli, 324 P.3d
at 281–82 (Chin, J., concurring); see also Cal. Fam. Code
§§ 65, 760; Cal. Civ. Code § 687. “This is a rebuttable
presumption affecting the burden of proof; hence it can be
overcome by the party contesting community property
status.” In re Marriage of Haines, 39 Cal. Rptr. 2d 673, 681
(Ct. App. 1995). The standard of proof to overcome this
burden is a preponderance of the evidence. See Valli,
324 P.3d at 276.
A more stringent application of the community property
presumption, which is not applicable here but is nonetheless
relevant, is contained in section 2581 of the California
Family Code. That section provides that:
For the purpose of division of property on
dissolution of marriage or legal separation of
the parties, property acquired by the parties
during marriage in joint form, including
property held in tenancy in common, joint
12 IN RE BRACE
tenancy, or tenancy by the entirety, or as
community property, is presumed to be
community property. This presumption is a
presumption affecting the burden of proof
and may be rebutted by either of the
following:
(a) A clear statement in the deed or other
documentary evidence of title by
which the property is acquired that
the property is separate property and
not community property.
(b) Proof that the parties have made a
written agreement that the property is
separate property.
Cal. Fam. Code § 2581.
According to the California Family Code, to change the
nature or characterization of property, spouses may
transmute the property by agreement or transfer, with or
without consideration. Id. § 850. 9 To be valid, a
9
Section 850 of the California Family Code provides:
Subject to Sections 851 to 853, inclusive, married
persons may by agreement or transfer, with or without
consideration, do any of the following:
(a) Transmute community property to separate
property of either spouse.
(b) Transmute separate property of either spouse
to community property.
IN RE BRACE 13
transmutation must be “made in writing by an express
declaration that is made, joined in, consented to, or accepted
by the spouse whose interest in the property is adversely
affected.” Id. § 852(a). “An ‘express declaration’ is a
writing signed by the adversely affected spouse ‘which
expressly states that the characterization or ownership of the
property is being changed.’” In re Marriage of Lafkas,
188 Cal. Rptr. 3d 484, 497 (Ct. App. 2015) (quoting In re
Estate of MacDonald, 794 P.2d 911, 918 (Cal. 1990)). “An
‘express declaration’ does not require use of the terms
‘transmutation,’ ‘community property,’ ‘separate property,’
or a particular locution.” Id. (quoting In re Marriage of
Starkman, 28 Cal. Rptr. 3d 639, 642 (Ct. App. 2005)).
“Though no particular terminology is required, the writing
must reflect a transmutation on its face, and must eliminate
the need to consider other evidence in divining this intent.”
Benson, 116 P.3d at 1158; see also Starkman, 28 Cal. Rptr.
3d at 642–43 (“The express declaration must unambiguously
indicate a change in character or ownership of property. A
party does not ‘slip into a transmutation by accident.’”
(internal citation omitted) (quoting In re Marriage of
Koester, 87 Cal. Rptr. 2d 76, 80 n.5 (Ct. App. 1999))). The
transmutation statute applies to property transactions
between spouses, as well as property transactions between
spouses and third parties. See Valli, 324 P.3d at 279–80.
On appeal, Mrs. Brace argues—as she did in the lower
courts—that the general community property presumption
yields to the common law form of title presumption, codified
in section 662 of the California Evidence Code. Section 662
provides, in full, that “[t]he owner of the legal title to
property is presumed to be the owner of the full beneficial
(c) Transmute separate property of one spouse to
separate property of the other spouse.
14 IN RE BRACE
title. This presumption may be rebutted only by clear and
convincing proof.” Cal. Evid. Code § 662. On appeal, Mrs.
Brace contends that the lower courts erred in applying the
community property presumption and characterizing the
property at issue as community property because the
evidence demonstrated that she and her debtor husband
acquired the property from a third party as joint tenants. In
support, Mrs. Brace relies on our decision in In re Summers,
which held that under California law, “the community
property presumption is rebutted when a married couple
acquires property from a third party as joint tenants.”
332 F.3d 1240, 1243 (9th Cir. 2003) (relying on, inter alia,
Haines, 39 Cal. Rptr. 2d at 682, and In re Pavich, 191 B.R.
838, 844 (Bankr. E.D. Cal. 1996)).
In Summers, a married couple and their daughter
purchased a parcel of real estate and took title as “Eugene
Summers and Ann Marie Summers, husband and wife[,] and
Aurora Summers, an unmarried woman, all as joint tenants.”
332 F.3d at 1242. Eventually, all three individuals filed
separate bankruptcy petitions with the wife filing first. Id.
The trustee in the wife’s case argued that the real property
was a community asset and thus property of the bankruptcy
estate in its entirety. Id. After a trial on the merits, the
bankruptcy court held that the community property
presumption was overcome by evidence of the deed, which
indicated the real property was held in joint tenancy. Id. The
BAP affirmed. Id.
On appeal, we affirmed the BAP. Id. at 1245. We first
explained the significance of the nature or characterization
of the property when defining the bankruptcy estate. Id. at
1243. We explained that the presumption under section 760
of the California Family Code that all property acquired by
married persons is community property can be rebutted
IN RE BRACE 15
through an agreement between the spouses or “by specifying
the form of title in which [the property] is held.” Id. at 1243.
Thus, we determined that “the community property
presumption ‘is overcome when a declaration in a deed or
other title instrument indicates spouses take title to property
as joint tenants.’” Id. (quoting Pavich, 191 B.R. at 844).
Because the deed in Summers specifically conveyed the real
property as joint tenants, we concluded that only the wife’s
separate interest in the property was part of the bankruptcy
estate. Id. at 1245. 10
On appeal, the parties dispute whether Summers is still
precedential in light of Valli, a marital dissolution
proceeding concerned with the division of property between
a husband and wife—in particular, an insurance policy on
the husband’s life purchased with community funds but
naming the wife as the sole beneficiary.
In Valli, the husband (Frankie Valli) used community
property funds to purchase an insurance policy on his life,
naming his wife (Randy Valli) as the policy’s only
beneficiary and owner. 324 P.3d at 275. In the marital
dissolution proceeding, the husband—relying on the
community property presumption—argued that the
insurance policy was community property because (1) it was
purchased with community property funds and (2) the
transmutation requirements under section 852 of the
California Family Code had not been met to change the
10
After finding that the community property presumption had been
overcome, we addressed whether California’s transmutation statute
generally applies to transactions between the spouses and a third-party
seller. Summers, 332 F.3d at 1244. Relying on several California Court
of Appeal decisions, we concluded that the transmutation statute is not
applicable to transactions between spouses and third parties. Id. That
holding was abrogated by Valli, and is not at issue here.
16 IN RE BRACE
property from community to separate property. Id. at 276.
The wife—relying on the form of title presumption—argued
that the insurance policy was separate property because the
husband put the policy in her name. The wife also argued
that, although the couple had not complied with the statutory
requirement that any transmutation be in writing, the
transmutation formalities are unnecessary in situations
where one spouse acquires property directly from a third
party rather than through an interspousal transaction. Id.
The Supreme Court of California rejected the wife’s
arguments, holding that: (1) the transmutation statutes apply
in property transactions between spouses, as well as in
property transactions between spouses and third parties; and
(2) section 662’s form of title presumption “does not apply
[in marital dissolution proceedings] when it conflicts with
the transmutation statutes.” Valli, 324 P.3d at 280 (citing In
re Marriage of Barneson, 81 Cal. Rptr. 2d 726, 733 (Ct.
App. 1999)). Finding that such a conflict existed, the Court
held that “the transmutation requirement of an express
written declaration applie[d] to [the] wife’s claim.” Id. The
Court did not otherwise expound on the matter. Id.
However, a concurring opinion joined by three justices
suggested that “rules that apply to an action between the
spouses to characterize property acquired during the
marriage do not necessarily apply to a dispute between a
spouse and a third party.” Valli, 324 P.3d at 284–85 (Chin,
J., concurring).
Appellee argues that Valli applies not only to suits
between spouses but also to non-dissolution cases involving
both spouses and third parties. Appellants and the amicus
curiae disagree. They contend that Valli does not abrogate
the holding in Summers (i.e., in bankruptcy cases, the
community property presumption can also be rebutted with
IN RE BRACE 17
evidence that spouses hold title as joint tenants) and that the
cases are reconcilable because Valli addressed the
community property presumption/transmutation statute only
in the context of a marital dissolution proceeding.
Appellants and the amicus curiae argue that marital
dissolution proceedings are unique and that it is only within
that context that the form of title presumption is disregarded
in favor of the general community property presumption.
Appellants and the amicus curiae contend that because the
special concerns in marital dissolution proceedings do not
exist in the broader context of bankruptcy and debtor-
creditor relationships, Valli does not abrogate Summers to
the extent that the record title presumption can no longer
overcome the community property presumption in
bankruptcy cases.
No controlling California precedent addresses the
applicability of the community property presumption in suits
between a married person and a third party creditor. We
recognize that, under California law, statutory interpretation
begins with the text. People v. Scott, 324 P.3d 827, 829 (Cal.
2014). But the text of the relevant statutes (and relevant
evidentiary codes) is susceptible to both of the opposing
interpretations offered by the parties, and we do not find the
answer to these issues obvious.
Accordingly, we respectfully ask the Supreme Court of
California to exercise its discretion to decide the following
certified question: Does the form of title presumption set
forth in section 662 of the California Evidence Code
overcome the community property presumption set forth in
section 760 of the California Family Code in Chapter 7
bankruptcy cases where: (1) the debtor husband and non-
debtor wife acquire property from a third party as joint
tenants; (2) the deed to that property conveys the property at
18 IN RE BRACE
issue to the debtor husband and non-debtor wife as joint
tenants; and (3) the interests of the debtor and non-debtor
spouse are aligned against the trustee of the bankruptcy
estate?
V. Accompanying Materials
The clerk of this court is hereby directed to file in the
Supreme Court of California, under official seal of the
United States Court of Appeals for the Ninth Circuit, copies
of all relevant briefs and excerpts of the record, and an
original plus ten copies of this order, along with a certificate
of service on the parties, as required by California Rule of
Court 8.548(c) and (d).
This case is withdrawn from submission. The Clerk is
directed to administratively close this docket, pending
further order. Further proceedings before us are stayed
pending final action by the Supreme Court of California.
The parties shall notify the clerk of this court within seven
days after the Supreme Court of California accepts or rejects
the request for a decision and again within seven days if that
court renders an opinion. The panel retains jurisdiction over
further proceedings.
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C-Track E-Filing
The Supreme Court
of Nevada
Appellate Case Management System
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Case Search
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| {
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661 F.2d 927
Spightv.Garrison
81-8149
UNITED STATES COURT OF APPEALS Fourth Circuit
7/1/81
1
M.D.N.C.
CPC DENIED--DISMISSED
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377 F.Supp.2d 361 (2005)
Renee MITCHELL, Plaintiff,
v.
Victoria HOME, Nelly Ramirez, Individually and as an Employee of Victoria Home, Frank Bluszcz, Individually and as a Special Investigator of the Attorney General of the State of New York, Defendants.
No. 04 Civ.9189 CM LMS.
United States District Court, S.D. New York.
July 12, 2005.
*362 *363 *364 *365 George William Echevarria, Ossining, NY, for Plaintiff.
*366 MEMORANDUM ORDER AND DECISION GRANTING DEFENDANT VICTORIA HOME'S MOTION TO DISMISS THE COMPLAINT, GRANTING DEFENDANT FRANK BLUSZCZ MOTION TO DISMISS CERTAIN CLAIMS, AND DISMISSING SUA SPONTE THE CLAIMS AGAINST DEFENDANT NELLY RAMIREZ
MCMAHON, District Judge.
The Amended Complaint filed by Plaintiff Renee Mitchell asserts federal constitutional claims pursuant to 42 U.S.C. § 1983 as well as several state law claims stemming from the termination of plaintiff's employment and her subsequent criminal prosecution.
Defendant Victoria Home, a nursing facility in Ossining, New York, move to dismiss plaintiff's claims against it pursuant to Fed.R.Civ.P. 12(b)(6). Defendant Frank Bluszcz, a Special Investigator ("SI Bluszcz") in the Medicaid Fraud Control Unit ("MFCU") at the office ("OAG") of Eliot Spitzer, Attorney General of the State of New York ("Attorney General"), move to dismiss certain claims asserted against him in the Amended Complaint against him pursuant to Fed.R.Civ.P. 12(b)(1) and 12(b)(6). Defendant Nelly Ramirez has not moved to dismiss the claims against her.
For the reasons articulated below, I grant the motions of Victoria Home and SI Bluszcz and I dismiss the claims against Ramirez sua sponte.
Facts
For the purpose of this motion to dismiss, all non-jurisdictional facts asserted in plaintiff's Amended Complaint are assumed to be true.
Until her termination in 2000, plaintiff Renee Mitchell was a certified nurse's assistant at the Victoria Home ("Victoria Home" or the "Home"), a nursing home in Ossining, New York. Amended Complaint ("Am.Cplt.") ¶¶ 10, 29. That year, plaintiff asserts, another Victoria Home employee named Nelly Ramirez ("Ramirez") reported to Victoria Home officials that, on or about January 1, 2000, she had observed plaintiff physically abuse an elderly resident. Id. ¶ 17. Ramirez's report caused the Home to begin investigating plaintiff's alleged conduct. Id. ¶¶ 17, 21.
Plaintiff alleges that, shortly after Ramirez made the report, Victoria Home employees interviewed plaintiff about the alleged incident. Id. ¶ 22. Although plaintiff denied any wrongdoing, the Home fired plaintiff shortly after the incident. Id. ¶¶ 23, 29. Plaintiff claims that Ramirez's report was "inaccurate, misleading and/or false," and that various Victoria Home employees, including Ramirez, conspired to exaggerate the incident to "insulate themselves from potential liability" and to justify plaintiff's termination. Id. ¶¶ 33, 34.
The Amended Complaint states that the Home thereafter reported plaintiff's alleged misconduct to the New York State Department of Health ("DOH"). Id. ¶ 37 Consequently, the OAG's MFCU began an investigation and, according to plaintiff, placed SI Bluszcz in charge. Id. ¶¶ 41, 42. According to plaintiff, SI Bluszcz, although aware of evidence exonerating plaintiff, sought to "exaggerate, magnify and distort" Ramirez's observations and "fabricate incriminating evidence" against plaintiff, and "conspired" with Ramirez and the Home to "bolster and magnify" Ramirez's accusations by, among other things, preparing a statement for Ramirez namely, a supporting deposition that "exaggerated and/or misstated" what Ramirez had observed. Id. ¶¶ 46-47, 49. Plaintiff alleges that the supporting deposition executed by Ramirez was written in English and was never translated into Spanish, *367 which according to plaintiff is Ramirez's primary language. Id. ¶¶ 54-56.
Plaintiff alleges that on October 3, 2000, the Attorney General then filed an accusatory instrument against plaintiff, consisting of an information signed by SI Bluszcz and of Ramirez's supporting deposition. Id. ¶¶ 51, 54; Exh. A. The accusatory instrument alleged that plaintiff hit and grabbed the elderly resident on the right side of her neck and chest, and that such conduct constituted willful violation of the New York Public Health law and regulations thereunder. Id. ¶¶ 57, 60.
A Press Release issued by the OAG on October 24, 2000, publicized Attorney General Elliot Spitzer's announcement that plaintiff had been arrested for physically abusing an 85-year-old female patient at an Ossening nursing home on New Years Day. Id. ¶ 64; Declaration of Martha A. Lee, dated May 27, 2005, Exh. B.[1]
The Amended Complaint alleges that on or about March 12, 2002, plaintiff was tried on the charge set forth in the accusatory instrument before a jury in the Village of Ossining Justice Court, Westchester County. Id. ¶ 65. Ramirez was called as the sole eyewitness against plaintiff and testified through a Spanish translator. Id. ¶ 66. According to plaintiff, Ramirez did not testify that she saw plaintiff hit the elderly resident, but rather that she saw plaintiff "push and hold" the elderly resident as the resident was trying to strike plaintiff. Id. ¶ 67. Ramirez also testified that she had not read the supporting deposition but that it was read to her and that she signed it because she was asked to do so and trusted the person who asked her to sign it. Id. ¶ 68.
The jury found plaintiff guilty, and on June 6, 2002, she was sentenced to 45 days in the county jail and three years probation. Id. ¶ 69; Declaration of George W. Echevarria, dated June 16, 2005, Exh. B. Plaintiff served 30 days of her 45-day sentence. Id. ¶ 70. Plaintiff appealed her conviction and, by order dated November 21, 2003, the Appellate Term reversed the conviction and dismissed the accusatory instrument. Id. ¶¶ 71, 72.
Prior History
Plaintiff commenced this action by filing a complaint on November 19, 2004 (the "Original Complaint"), which named five defendants: Victoria Home; Ramirez, individually and as an employee of the Home; SI Bluszcz, individually and in his official capacity; Gerald Epstein, a Special Assistant Attorney General ("SAAG") in the MFCU of the OAG, individually and in his official capacity; and the Attorney General, individually and in his official capacity. See Original Complaint, Caption. The Original Complaint appeared to assert federal constitutional claims under the Fourth, Fifth, Sixth, and Fourteenth Amendments to the United States Constitution via 42 U.S.C. § 1983. Id. ¶ 75. Plaintiff also sought to invoke the Court's supplemental jurisdiction under 28 U.S.C. § 1367 to assert state law claims for malicious prosecution, wrongful termination, defamation, abuse of process, false arrest, *368 false imprisonment, unlawful detention, and unlawful imprisonment. Id. ¶¶ 9, 74.
On April 8, 2005, SI Bluszcz, SAAG Epstein, and the Attorney General (the "Original State Defendants") moved to dismiss the Original Complaint pursuant to Rules 12(b)(1) and 12(b)(6) and Victoria Home moved to dismiss the Original Complaint against it pursuant to Rule 12(b)(6).
On May 2, 2005, plaintiff filed a memorandum of law in opposition to the Original State Defendants' and Victoria Home's motions to dismiss. On May 3, 2005, however, plaintiff filed the Amended Complaint, thereby superseding the Original Complaint and mooting the first motions to dismiss.
The Amended Complaint
The Amended Complaint no longer names SAAG Epstein and the Attorney General as defendants, leaving SI Bluszcz, in his individual and official capacities, as the only remaining state defendant, and Victoria Homes and Ramirez as the other remaining defendants. See Am. Cplt., Caption.
The Amended Complaint contains four separate counts. Count I is denominated "42 U.S.C. § 1983 Against Individual Defendants," and "claims damages for the injuries set forth above against Defendants Ramirez, Victoria Home and Bluszcz" for violation of plaintiff's constitutional rights. Am. Cplt. ¶¶ 76-77 (Count I).
In Counts II through IV of the Amended Complaint, plaintiff seeks to invoke the Court's supplemental jurisdiction under 28 U.S.C. § 1367 to assert state law claims for: defamation against Victoria Home and Ramirez (Count II); for unlawful termination against Victoria Home (Count III); and for false arrest, malicious prosecution, and false imprisonment against all three defendants (Count IV). See id. ¶¶ 7, 76-86. As for relief, via the Amended Complaint plaintiff continues to seek compensatory damages, costs and expenses, and attorney's fees. Id., "Wherefore" clause.
Standards
For purposes of analyzing a motion to dismiss, the pleadings should be read in the light most favorable to the non-moving party, and the plaintiff's allegations as to the material facts should be taken as true. See Albright v. Oliver, 510 U.S. 266, 267, 114 S.Ct. 807, 810, 127 L.Ed.2d 114 (1994); Cooper v. Pate, 378 U.S. 546, 84 S.Ct. 1733, 12 L.Ed.2d 1030 (1964); Easton v. Sundram, 947 F.2d 1011, 1014-15 (2d Cir.1991), cert. denied, 504 U.S. 911, 112 S.Ct. 1943, 118 L.Ed.2d 548 (1992). The court generally must limit its analysis "to the facts stated in the complaint or in documents attached to the complaint as exhibits or incorporated in the complaint by reference." Kramer v. Time Warner Inc., 937 F.2d 767, 773 (2d Cir.1991). In addition, the court may consider public records, including a state court's divorce decree, in deciding a motion to dismiss, even if that document was not incorporated in the complaint by reference. Taylor v. Vermont Dep't of Educ., 313 F.3d 768, 776 (2d Cir.2002); Cortec Industries, Inc. v. Sum Holding L.P., 949 F.2d 42, 48 (2d Cir.1991); Pani v. Empire Blue Cross Blue Shield, 152 F.3d 67, 75 (2d Cir.1998); see also Blue Tree Hotels Inv. (Can.), Ltd. v. Starwood Hotels & Resorts Worldwide, Inc., 369 F.3d 212, 217 (2d Cir.2004).
A court may grant a Rule 12(b)(6) motion to dismiss for failure to state a claim only "when it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Phillip v. University of Rochester, 316 F.3d 291, 293 (2d Cir.2003) (quoting Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)); Kaltman-Glasel v. Dooley, 156 F.Supp.2d 225, 226 (D.Conn.2001); see also Swierkiewicz v. Sorema, N.A., 534 U.S. 506, 122 S.Ct. *369 992, 998, 152 L.Ed.2d 1 (2002); King v. Simpson, 189 F.3d 284, 286 (2d Cir.1999). The issue is not whether the plaintiff will ultimately prevail but whether the plaintiff is entitled to offer evidence to support the claims. Villager Pond, Inc. v. Town of Darien, 56 F.3d 375, 378 (2d Cir.1995).
Courts evaluating Rule 12(b)(1) motions "may resolve the disputed jurisdictional fact issues by reference to evidence outside the pleadings, such as affidavits." Zappia Middle East Constr. Co. Ltd. v. Emirate of Abu Dhabi, 215 F.3d 247, 253 (2d Cir.2000). On a motion to dismiss pursuant to Rule 12(b)(1), plaintiff carries the burden of establishing that subject matter jurisdiction exists over the complaint. See Malik v. Meissner, 82 F.3d 560, 562 (2d Cir.1996); In re Joint E. & So. Dist. Asbestos Litig., 14 F.3d 726, 730 (2d Cir.1993); Beacon Enterprises, Inc. v. Menzies, 715 F.2d 757, 762 (2d Cir.1983).
Discussion
I. Count I: 42 U.S.C. § 1983 Against Individual Defendants
Count I of the Amended Complaint is against all defendants and is brought pursuant to 42 U.S.C. § 1983. From the Amended Complaint, it is unclear what federal constitutional "injuries set forth above" plaintiff asserts, but the reference appears to be to paragraph 74 of the Amended Complaint, although Count I explicitly fails to incorporate paragraph 74 by reference. See ¶ 76 (incorporating by reference only paragraphs 1 through 72 into Count I). Paragraph 74 asserts the following injuries: violations of plaintiff's rights under the Fourth, Fifth, Sixth, and Fourteenth Amendments of the United State Constitution; defamation; unlawful termination; false arrest; malicious prosecution; false imprisonment; and loss of physical liberty. Id. ¶ 74. As clarified (to some extent) in plaintiff's memoranda of law in opposition to the motions to dismiss, the § 1983 claim the only federal claim asserted is for the alleged "violation of rights under the Fourth, Fifth, Sixth, and Fourteenth Amendments to the United States Constitution." See Memorandum of Law in Opposition to the Motion of Defendant Victoria Home Seeking Dismissal of the Complaint, dated June 16, 2005 ("Pl. Mem. Opp. Victoria Home") at 1; Memorandum of Law in Opposition to the Motion of the State Defendant Seeking Dismissal of the Complaint, dated June 16, 2005 ("Pl. Mem. Opp. State Defendant") at 1.[2]
1. Section 1983 Claims Against Victoria Home and Nelly Ramirez
Neither Victoria Home nor Ramirez is a state actor and therefore, neither is a proper defendant on any claim brought pursuant to § 1983.
In order to prevail in any claim against Victoria Home under § 1983, plaintiff must first show that Victoria Home, a private party, was "acting under color of state law" at the time she allegedly violated Plaintiff's constitutional rights. West v. Atkins, 487 U.S. 42, 48, 108 S.Ct. 2250, 101 L.Ed.2d 40 (1988); Sherlock v. Montefiore Med. Ctr., 84 F.3d 522, 527 (2d Cir.1996). A private individual can be held liable under § 1983 "only as a `willful participant in joint activity with the State or its agents.'" Spear v. Town of West Hartford, 954 F.2d 63, 68 (2d Cir.) (quoting Adickes v. S.H. Kress & Co., 398 U.S. 144, 152, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970)), cert. denied, 506 U.S. 819, 113 S.Ct. 66, 121 L.Ed.2d 33 (1992). "Actions by a private party are deemed state action if `there is a sufficiently *370 close nexus between the State and the challenged action' that the actions by the private parties `may be fairly treated as that of the State itself.'" Chan v. City of New York, 1 F.3d 96, 106 (2d Cir.1993) (citation omitted), cert. denied sub nom. 510 U.S. 978, 114 S.Ct. 472, 126 L.Ed.2d 423 (1993). "The purpose of [the close-nexus] requirement is to assure that constitutional standards are invoked only when it can be said that the State is responsible for the specific conduct of which the plaintiff complains." Id. (emphasis in original; citations omitted).
The Supreme Court has established three tests to determine whether a private person is deemed to be a "state actor" for purposes of § 1983:(1) the public function test (Rendell-Baker v. Kohn, 457 U.S. 830, 842, 102 S.Ct. 2764, 73 L.Ed.2d 418 (1982)); (2) the state compulsion test (Adickes v. S.H. Kress & Co., 398 U.S. 144, 170, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970)); and (3) the symbiotic relationship or nexus test (Burton v. Wilmington Parking Auth., 365 U.S. 715, 725, 81 S.Ct. 856, 6 L.Ed.2d 45 (1961)). Plaintiff fails to establish that Victoria Homes is a state actor under any of these three tests.
In order to make out a claim of state action under the "public function" test, plaintiff must show that Victoria Home's function as a provider of nursing care is "`traditionally the exclusive prerogative of the State.'" Rendell-Baker, 457 U.S. at 842, 102 S.Ct. 2764 (emphasis in original; citation omitted). Administration of a nursing home facility is not traditionally an exclusive prerogative of the state. See Blum v. Yaretsky, 457 U.S. 991, 1012, 102 S.Ct. 2777, 73 L.Ed.2d 534 (1982)(decisions made in the day-to-day administration of a nursing home are not traditional and exclusive prerogative of the State). Plaintiff thus fails to meet the "public function" test.
To prevail under the "state compulsion" test, plaintiff must show that the state actor "exercised coercive power or ... provides such significant encouragement, either overt or covert, that the choice must in law be deemed to be that of the State." Blum, 457 U.S. at 1004, 102 S.Ct. 2777. (citations omitted). Plaintiff fails to allege that the OAG engaged in coercive conduct over Victoria Home or any of its employees including Ramirez during the nursing home's investigation of patient abuse. Plaintiff thus fails to meet the requirements of the "state compulsion" test.
To prevail under the "symbiotic relationship" test, plaintiff must show that "[t]he State has so far insinuated itself into a position of interdependence with [Victoria Home] ... that it must be recognized as a joint participant in the challenged activity." Burton, 365 U.S. at 725, 81 S.Ct. 856. Here too, plaintiff fails to allege that the state has any type of interdependent relationship with Victoria Home that the two could be considered joint participants. Therefore, plaintiff fails to meet the requirements of the "symbiotic relationship" test as well.
As a matter of law, plaintiff has failed to state a claim under any of the three tests that Victoria Home, a private not-for-profit corporation, was a state actor for purposes of the Section 1983 claim. Plaintiff therefore cannot maintain a Section 1983 action against Victoria Home, and Count I against Victoria Home is dismissed. The § 1983 claims against Ramirez are dismissed sua sponte for the same reasons.
2. Section 1983 Claims Against Bluszcz
As clarified in the plaintiff's memorandum of law, § 1983 claim against SI Bluszcz, alleges that "Bluszcz, acting under color of state law, engaged in conduct *371 both individually and as a Special Investigator ... to deprive plaintiff of her rights under the Fourth, Fifth, Sixth, and Fourteenth Amendments of the United States Constitution." See Pl. Mem. Opp. State Defendant at 1.
a. Fourth Amendment: Federal Claim for False Arrest/False Imprisonment
Although plaintiff purports to assert false arrest and false imprisonment as two independent causes of action, see, e.g., Am. Cplt. ¶ 74(f), (h), false arrest is considered a kind of false imprisonment, and the claims are analyzed in identical fashion. See, e.g., Singer v. Fulton County Sheriff, 63 F.3d 110, 118 (2d Cir.1995)(describing false arrest claim as type of false imprisonment claim and stating that claims are analyzed identically), cert. denied, 517 U.S. 1189, 116 S.Ct. 1676, 134 L.Ed.2d 779 (1996); Weyant v. Okst, 101 F.3d 845, 853 (2d Cir.1996)(quoting Singer).
The elements of a false arrest claim under § 1983 are substantially the same as the elements of a false arrest claim under New York law. See Boyd v. City of New York, 336 F.3d 72, 75 (2d Cir.2003) (citing Hygh v. Jacobs, 961 F.2d 359, 366 (2d Cir.1992)). And, because false arrest is a type of false imprisonment, the two claims have identical elements. Singer, 63 F.3d at 118. For this reason, this decision discusses false arrest and false imprisonment interchangeably.[3]
Under New York law, the elements of a false imprisonment claim are: "(1) the defendant intended to confine [the plaintiff], (2) the plaintiff was conscious of the confinement, (3) the plaintiff did not consent to the confinement and (4) the confinement was not otherwise privileged." Broughton v. State, 37 N.Y.2d 451, 456, 373 N.Y.S.2d 87, 335 N.E.2d 310 (1975), cert. denied, 423 U.S. 929, 96 S.Ct. 277, 46 L.Ed.2d 257 (1975). Contrary to plaintiff's arguments, a favorable termination of the proceedings is not an element of this tort. Weyant, 101 F.3d at 853 ("while the favorable termination of judicial proceedings is an element of a claim for malicious prosecution, ... it is not an element of a claim for false arrest") (citing Singer, 63 F.3d at 118).
Although the statute of limitations period is determined by reference to state law, the determination of when a claim accrues is governed by federal law. See Veal v. Geraci, 23 F.3d 722, 724 (2d Cir.1994). Under New York law, the statute of limitations for § 1983 claims premised on torts such as false arrest or false imprisonment is three years. See Owens v. Okure, 488 U.S. 235, 251, 109 S.Ct. 573, 582, 102 L.Ed.2d 594 (1989); Wynder v. McMahon, 360 F.3d 73, 76 (2d Cir.2004). The accrual point of a Section 1983 claim for false arrest depends on whether or not the plaintiff's prevailing on the claim would render her conviction invalid. See Covington v. City of New York, 171 F.3d 117, 123 (2nd Cir.1999); see also Preston v. State of New York, 223 F.Supp.2d 452, 467 (S.D.N.Y.2002).
*372 Plaintiff's relies on Heck, supra, 512 U.S. 477, 114 S.Ct. 2364, 129 L.Ed.2d 383 (see, e.g., Pl. Mem. Opp. State Defendant at 2-4), to demonstrate that her federal false arrest and false imprisonment claims did not accrue until November 21, 2003, the date that Appellate Term reversed her conviction. She is wrong. In Heck the Supreme Court was concerned, not with a false-arrest type of claim, but rather with a claim "close[ly] analog [ous]" to the "common-law cause of action for malicious prosecution" (512 U.S. at 484, 114 S.Ct. 2364), a type of claim in which favorable termination of the proceedings is an element. See, e.g., Weyant, 101 F.3d at 853; Broughton v. State, 37 N.Y.2d at 457, 373 N.Y.S.2d 87, 335 N.E.2d 310.
Under Covington, a wrongful arrest claim would not necessarily undermine a criminal conviction, and would therefore accrue at the time of the arrest, "if there were independent evidence upon which a conviction could be obtained that was not in any way tainted by the unlawful arrest." Covington, 171 F.3d at 123.
In the Amended Complaint, plaintiff does not allege that any evidence used against her at her criminal trial was gathered subsequent to, and thus as a result of, her arrest. To the contrary, she alleges that the evidence used to convict her was procured before her arrest. See, e.g., Am.Cplt. ¶¶ 17, 21-25, 32, 41-48, 51-53. Indeed, none of the evidence that the Amended Complaint asserts was harmful to plaintiff is alleged to have been collected through any interaction with plaintiff at all. Rather, plaintiff's case rests on her allegations that any incriminatory evidence was fabricated by SI Bluszcz and the other defendants, and that any evidence she or her colleague at Victoria Home, Judith McIntosh, gave to defendants was exculpatory, not incriminating. See, e.g., id. ¶¶ 23, 24, 25, 34, 46, 47, 48, 49, 74.
Because plaintiff never alleges that any evidence used against her was derived from her arrest, the accrual date of her § 1983 false arrest/false imprisonment claim was the date of her arrest. See, e.g., Preston, 223 F.Supp.2d at 467 (finding that accrual date of Section 1983 false arrest claim was date of arrest where evidence relied on at trial was obtained from sources other than plaintiff's arrest, and dismissing claim as time-barred).
The Amended Complaint does not allege either that plaintiff was arrested or that any evidence against her was gathered as a result of any such arrest. Nonetheless, the OAG Press Release she references (see Am. Cplt. ¶ 64), is dated October 24, 2000 (see Lees Decl., Exhibit B), announces that plaintiff's arrest has already occurred, and indicates that she was arraigned on the same day as the press release was issued. Her arrest thus occurred no later than October 24, 2000. Plaintiff's § 1983 false arrest claim accrued no later than that date.
Because plaintiff did not commence this action until November 19, 2004, over four years after her claim accrued and over a year after the three-year limitations period for that claim expired, plaintiff's § 1983 Fourth Amendment violation claims for false arrest/false imprisonment are dismissed for failure to state a claim as time-barred.
b. Fifth Amendment & Fourteenth Amendment
Plaintiff also fails to state a claim for violation of her due process rights under the Fifth Amendment. The Fifth Amendment's Due Process Clause protects citizens against only federal government actors, not State officials. Dusenbery v. United States, 534 U.S. 161, 167, 122 S.Ct. 694, 151 L.Ed.2d 597 (2002). Any due process rights plaintiff enjoys as against *373 state government officials, like SI Bluszcz, arise solely from the Fourteenth Amendment due process clause. Id. Therefore, in so far as plaintiff's § 1983 claim against SI Bluszcz is based on a violation of her constitutional rights under Fifth Amendment, that claim is dismissed.
As for Fourteenth Amendment due process, plaintiff alleges no deprivation of her liberty separate from that inherent in her § 1983 claims for denial of a fair trial, false arrest, false imprisonment, or malicious prosecution. Plaintiff's Fourteenth Amendment claim therefore fails to the same extent as do those claims. See supra, I.2.a. (false arrest/false imprisonment claim time-barred); infra I.2.c. (fair trial claim time-barred). I note that SI Bluszcz does not seek dismissal of plaintiff's federal or state malicious prosecution claims on this motion. See Defendant Bluszcz's Memorandum of Law in Support of His Motion to Dismiss the Amended Complaint, dated May 27, 2005, at 14 n. 4. Therefore, plaintiff's Fourteenth Amendment claim, and the corresponding state law claim, survive this motion.
c. Sixth Amendment
The essence of plaintiff's Sixth Amendment fair trial claim is her allegation that SI Bluszcz sought to "exaggerate" Ramirez's observations and "fabricate incriminating evidence" against plaintiff. See, e.g., Am. Cplt. ¶¶ 46-47, 49. Under Second Circuit law, fabrication of evidence by a law enforcement officer and forwarding of such evidence to prosecutors is considered inherently harmful, regardless of whether there existed untainted evidence independently supporting arrest or conviction. See, e.g., Ricciuti v. N.Y.C. Transit Auth., 124 F.3d 123, 129-30 (2d Cir.1997).
Under New York law, the statute of limitations for § 1983 claims premised on torts such as fabrication of evidence is three years. See Owens, supra, 488 U.S. at 251, 109 S.Ct. 573. And for statute of limitations purposes, a § 1983 claim, including a Sixth Amendment fair trial claim, accrues when the alleged conduct has caused the claimant harm and the claimant knows or has reason to know of the allegedly impermissible conduct and the resulting harm. Veal, supra, 23 F.3d at 724 (citing Singleton v. New York, 632 F.2d 185, 191 (2d Cir.1980)). "The reference to `knowledge of the injury' does not suggest that the statute does not begin to run until the claimant has received judicial verification that the defendants' acts were wrongful." Id. (citing Woods v. Candela, 13 F.3d 574, 575-76 (2d Cir.1994)) (claim for unlawful arrest and search accrued when, with accused's knowledge, those acts occurred, not when appellate court later vacated his conviction); Mack v. Varelas, 835 F.2d 995, 999 (2d Cir.1987) (claim based on sheriff's failure to produce a defense witness at trial accrued when the accused was incarcerated as a result of his conviction, not upon eventual ruling by appellate court as to whether that failure would warrant reversal of conviction). Thus, a fair trial claim premised on fabrication of evidence accrues when the plaintiff learns or should have learned that the evidence was fabricated and such conduct causes the claimant some injury. See id. at 724-25.
In this case, the accusatory instrument charging plaintiff was signed by SI Bluszcz on October 3, 2000. See Am. Cplt., Exh. A. Under New York law, where, as here, a criminal proceeding is commenced by the filing of an accusatory instrument, arraignment follows shortly after filing. See, e.g., Murphy v. Lynn, 118 F.3d 938, 944 (2d Cir.1997). Since plaintiff was arraigned on October 24, 2000, see Lees Decl. Exhibit B, the accusatory instrument must have been filed between its October 3, 2000 signing and the October *374 24, 2000 arraignment. Plaintiff's allegations regarding SI Bluszcz's involvement in her case cease as of the time he allegedly prepared, or directed the preparation of, and executed, the accusatory instrument used to initiate plaintiff's criminal proceedings, which means his alleged involvement ceased as of October 3, 2000. See Am. Cplt. ¶¶ 63-73.
Thus, when plaintiff alleges that SI Bluszcz threatened to have Judith McIntosh (plaintiff's former colleague at Victoria Home, who was also terminated) arrested and prosecuted if she did not make an untrue statement implicating plaintiff, (id. ¶ 24, 29, 47), it is evident that the alleged threat cannot have been made later than October 3, 2000. Id. ¶¶ 23, 24, 29, 47, 51. And the Supporting Deposition that was attached to the accusatory instrument was signed by Ramirez on October 3, 2000. Id. ¶¶ 51, 54; Exh. A.
Assuming, as I must, that plaintiff's allegations are true, they indicate that plaintiff knew or should have known, by October 3, 2000, that SI Bluszcz was allegedly attempting to procure false evidence against her.
As discussed, plaintiff's arrest could have occurred no later than October 24, 2000. See supra, I.2.a. (citing Lees Decl., Exh. B). Upon plaintiff's arrest, her a fair trial claim premised on fabrication of evidence accrued because plaintiff knew or should have known that the evidence was fabricated and that she had suffered some injury as a result. See Veal, 23 F.3d at 724-25.
Because plaintiff did not file this action until well over three years after October 24, 2000, i.e., until November 19, 2004, any alleged violation of plaintiff's Sixth Amendment right to a fair trial is time-barred.
d. Loss of Physical Liberty
Among the injuries that plaintiff alleges is "[l]oss of physical liberty." Am. Cplt. ¶ 74(i). Plaintiff does not allege a § 1983 deprivation of physical liberty separate from that associated with false arrest/imprisonment or malicious prosecution. Therefore, I dismiss this claim as surplusage. Plaintiff can pursue damages for the loss of her liberty on her § 1983 and state claim for malicious prosecution.
II. Count II: Defamation
Count II is a defamation claim against Victoria Home and Ramirez.
According to the Amended Complaint, all of the allegedly defamatory statements attributable to Victoria Home or Ramirez were made between January 1, 2000 when Ramirez initially reported the physical abuse (see Am. Cplt. ¶ 17) and plaintiff's trial, which occurred on or about March 12, 2002. Id. ¶ 65. Therefore the latest possible date on which Victoria Home or Ramirez could have made any of the allegedly defamatory statements mentioned in the Amended Complaint was on or about March 12, 2002.
Under New York law, an action for "libel, slander, [or] false words causing special damages" must "be commenced within one year." N.Y. C.P.L.R. 215(3). "For the purpose of computing the running of the one year statute of limitations [for defamation], the causes of action accrue on the day the statements were made." Vasile v. Dean Witter Reynolds, Inc., 20 F. Supp 2d 465, 495 (E.D.N.Y.1998), aff'd, 205 F.3d 1327 (2d Cir.2000).
Plaintiff's erroneous argument that under Boose v. City of Rochester, 71 A.D.2d 59, 64-65, 421 N.Y.S.2d 740 (4th Dep't 1979), the statute of limitations for the claims arising in intentional tort did not accrue until November 21, 2003 the date on which her conviction and sentence were invalidated has no merit. This case deals with a cause of action for false imprisonment and malicious prosecution and has no *375 applicability to plaintiff's defamation claim. See id.
Because this action was commenced on November 19, 2004, over two and one half years after the latest date upon which the statute of limitation could have begun to run, the defamation claim is dismissed against Victoria Home as time-barred. For the same reason, this claim is dismissed sua sponte as against Ramirez.
III. Count III: Unlawful Termination
The third claim in the Amended Complaint is for "unlawful termination" against Victoria Home. The Amended Complaint generally alleges that "the acts of Victoria Home resulted in the unlawful termination of the Plaintiff for which she suffered damages." Am. Cplt. ¶ 82.
Unlawful termination, however, is not a cause of action recognized in New York. Furthermore, it is well settled under New York law that when employment is for an indefinite term, the employee is considered to be an employee at-will, and that such employment may be terminated by either party for any reason or no reason at all. See Sabetay v. Sterling Drug, 69 N.Y.2d 329, 333, 514 N.Y.S.2d 209, 506 N.E.2d 919 (1987); Murphy v. American Home Prods. Corp., 58 N.Y.2d 293, 297, 461 N.Y.S.2d 232, 448 N.E.2d 86 (1983) ("this court has not and does not now recognize a cause of action in tort for abusive or wrongful discharge of an employee; such recognition must await action of the Legislature").
In Murphy, the New York Court of Appeals stated that to recognize such a cause of action "would alter our long-settled rule that where an employment is for an indefinite term it is presumed to be a hiring at will which may be freely terminated by either party at any time for any reason or even for no reason" Id. at 300, 461 N.Y.S.2d 232, 448 N.E.2d 86; see also Horn v. New York Times, 100 N.Y.2d 85, 91-92, 760 N.Y.S.2d 378, 790 N.E.2d 753 (2003) (noting holding in Murphy); Riccardi v. Cunningham, 291 A.D.2d 547, 548, 737 N.Y.S.2d 871 (2d Dep't 2002) ("This State neither recognizes a tort of wrongful discharge nor requires good faith in an at-will employment relationship") (citation omitted); Rooney v. Tyson, 127 F.3d 295, 296-97 (2d Cir.1997) (citing holding in Murphy).
The Amended Complaint does not plead the existence of a written contract of employment between plaintiff and Victoria Home, that the job was for a specified duration, or that plaintiff accepted employment on the condition that she could only be discharged for cause. Therefore, plaintiff was an at-will employee and these circumstances do not give rise to a cause of action for wrongful termination. See e.g., Civiletti v. Independence Sav. Bank, 236 A.D.2d 436, 653 N.Y.S.2d 142 (2d Dep't 1997); Mayer v. Publishers Clearing House, 205 A.D.2d 506, 507, 613 N.Y.S.2d 190 (2d Dep't 1994).
Lastly, assuming arguendo that this cause of action had been predicated upon an enforceable contract, the plaintiff's claim accrued upon her termination from employment. See Sam v. Church of St. Mark, 293 A.D.2d 663, 664-65, 741 N.Y.S.2d 267 (2d Dep't 2002). Any recovery for an intentional tort involving unlawful termination of plaintiff's employment would be barred by the one year statute of limitations for intentional torts. See N.Y. C.P.L.R. 215(3) (McKinney 2003); Sam, 293 A.D.2d at 665, 741 N.Y.S.2d 267; Gallagher v. Directors Guild of Am., Inc., 144 A.D.2d 261, 262, 533 N.Y.S.2d 863, 864 (1st Dep't 1988). Although the Amended Complaint does not specify the date of plaintiff's termination by Victoria Home, the events concerning the termination of her employment are generally alleged to have occurred in January 2000. See Am. *376 Cplt. ¶¶ 14-29. Since the events concerning Plaintiff's termination from employment occurred in January 2000 (Am.Cplt.¶¶ 14-29), the commencement of this action on November 19, 2004 was well beyond the one-year statute of limitations applicable to any wrongful termination claim by Plaintiff.
IV. Count IV: False Arrest, Malicious Prosecution, and False Imprisonment
Count IV is for false arrest, malicious prosecution, and false imprisonment against all three defendants. These state law claims are brought pursuant to this Court's supplemental jurisdiction under 28 U.S.C. § 1367.
Under New York law, false imprisonment and malicious prosecution are independent torts, either of which may arise as a result of a false arrest. See Broughton, supra, 37 N.Y.2d at 457, 373 N.Y.S.2d 87, 335 N.E.2d 310 (explaining "[t]he distinction between false imprisonment and malicious prosecution in the area of arrest"); cf., 59 N.Y. Jur.2d False Imprisonment § 1 (2005) ("False arrest and false imprisonment are largely synonymous"). Because a cause of action for false arrest is essentially the same tort as false imprisonment (see Blanchfield v. State of New York, 104 Misc.2d 21, 427 N.Y.S.2d 682 (1980)), they will be discussed as one cause of action.
1. Victoria Home
a. State False Arrest/False Imprisonment Claim
Plaintiff has failed to properly plead a false imprisonment claim against Victoria Home. To plead such a claim, plaintiff must allege that: "(1) the defendant intended to confine him, (2) the plaintiff was conscious of his confinement, (3) the plaintiff did not consent to the confinement, and (4) the confinement was not otherwise privileged". Broughton, supra, 37 N.Y.2d at 456, 373 N.Y.S.2d 87, 335 N.E.2d 310.
The Amended Complaint does not allege that Victoria Home had any role in plaintiff's pre-arraignment confinement. The accusatory instrument leading to plaintiff's arrest was filed by the MFCU of the OAG "over nine months after" the underlying incident of resident abuse and Victoria Home's statutorily-required report to the DOH. This was subsequent to the MFCU investigation, and long after plaintiff's termination by Victoria Home. Am. Cplt. ¶¶ 26, 41-42, 53.
Moreover, "[t]here is no liability for merely giving information to legal authorities, who are left entirely free to use their own judgment in effecting an arrest, or in swearing out a criminal complaint so that an arrest is legally authorized". Chapo v. Premier Liquor Corp., 259 A.D.2d 1050, 1051, 688 N.Y.S.2d 342, 343 (4th Dep't 1999) (citing Cobb v. Willis, 208 A.D.2d 1155, 1156, 617 N.Y.S.2d 601, 603 (3d Dep't 1994)). See also Perez v. Charter One FSB, 298 A.D.2d 447, 748 N.Y.S.2d 392, 392 (2d Dep't 2002) (dismissing "false arrest and false imprisonment" claim where defendant "merely supplied information to the police who determined that an arrest was appropriate"); Schrull v. Shafer, 252 A.D.2d 723, 675 N.Y.S.2d 395, 396 (3d Dep't 1998) ("A civilian complainant cannot be held liable for false arrest where he has purely furnished information to legal authorities, who were then free to use their own judgment as to whether an arrest would be made or criminal charges filed"). In this case, Victoria Home simply made a statutorily-required report to the New York State Department of Health, which presumably directed the matter to the MFCU. Am. Cplt. ¶¶ 37, 41.
Accordingly, plaintiff has failed as a matter of law to allege a claim of false *377 imprisonment as against Victoria Home. The state claims against Ramirez for unlawful arrest/unlawful imprisonment are dismissed sua sponte for the same reasons.
b. State Malicious Prosecution Claim
Plaintiff's malicious prosecution claim is also meritless. To plead a claim of malicious prosecution, plaintiff must allege: "(1) the commencement or continuation of a criminal proceeding by the defendant against the plaintiff, (2) the termination of the proceeding in favor of the accused, (3) the absence of probable cause for the criminal proceeding, and (4) actual malice". Broughton, supra, 37 N.Y.2d at 457, 373 N.Y.S.2d 87, 335 N.E.2d 310.
Victoria Home, a private party, is not alleged to have "commenced or continued" any criminal proceeding against the plaintiff (nor is Ramirez). Victoria Home simply made a statutorily-required report to the New York State Department of Health. Am. Cplt. ¶ 37. The Department of Health presumably directed the matter to the MFCU, which conducted its own investigation and determined to filed charges. Am. Cplt. ¶¶ 41-42, 52. Furthermore, plaintiff was not even criminally charged by the State until long after Victoria Home had terminated her. Am. Cplt. ¶¶ 17, 26, 53. Accordingly, Victoria Home's link to plaintiff's prosecution is tenuous at best, and, thus, plaintiff has failed to adequately plead the first element of a claim for malicious prosecution as against Victoria Home. See e.g., Everson v. First Trust & Deposit Co., 46 A.D.2d 722, 360 N.Y.S.2d 338, 339 (4th Dep't 1974).
Moreover, "[i]t is well settled in this State's jurisprudence that a civilian complainant, by merely seeking police assistance or furnishing information to law enforcement authorities who are then free to exercise their own judgment as to whether an arrest should be made and criminal charges filed, will not be held liable for ... malicious prosecution". Paisley v. Coin Device Corp., 5 A.D.3d 748, 749-50, 773 N.Y.S.2d 582, 583 (2d Dep't 2004) (quotation and citation omitted). The New York Court of Appeals has even held that, where plaintiff alleges that defendant "gave false information" to the authorities, "[t]his is not enough" for a malicious prosecution claim. Al Raschid v. News Syndicate Co., 265 N.Y. 1, 3, 191 N.E. 713, 713 (1934) (citing Barry v. Third Avenue R.R., 51 A.D. 385, 386, 64 N.Y.S. 615 (1st Dep't 1900)). Thus, even assuming, arguendo, that the information provided by Victoria Home to the New York State Department of Health was incorrect, no action for malicious prosecution will lie as against Victoria Home.
For these reasons, the state malicious prosecution claim is dismissed as against Victoria Home. And for the same reasons, it is also dismissed as against Ramirez sua sponte.
2. SI Bluszcz
a. State False Arrest/False Imprisonment
The statute of limitations for state law false arrest or false imprisonment, an intentional tort, is one year. CPLR 215(3); see, e.g., Gallagher v. Directors Guild, 144 A.D.2d 261, 262, 533 N.Y.S.2d 863, 864 (1st Dep't 1988). The accrual of pendant state law tort claims, such as false arrest, in federal court actions is governed by state law. See, e.g., Walker v. Armco Steel Corp., 446 U.S. 740, 750-51, 100 S.Ct. 1978, 1985, 64 L.Ed.2d 659 (1980); Piesco v. City of New York, *378 650 F.Supp. 896, 899-900 (S.D.N.Y.1987) (following Walker). In New York, a state claim for false arrest/false imprisonment accrues when a plaintiff is released from pre-arraignment custody. Molyneaux v. County of Nassau, 16 N.Y.2d 663, 663, 261 N.Y.S.2d 294, 294, 209 N.E.2d 286 (1965) (holding that limitations period for state false arrest claim began to run when plaintiff, upon arraignment, was released on own recognizance); Salman v. Econo Lodge, 303 A.D.2d 923, 923-24, 755 N.Y.S.2d 678, 678-79 (4th Dep't 2003) (same); Palmer v. City of New York, 226 A.D.2d 149, 149, 640 N.Y.S.2d 92, 92 (1st Dep't 1996) (same).[4]
Under these standards, Plaintiff's state false arrest and false imprisonment claims are also time-barred because plaintiff failed to bring them within a year of her arrest and subsequent arraignment. Plaintiff alleges that she was held in custody only after her conviction (see Am. Cplt. ¶ 70), so her state false arrest/false imprisonment claim cannot have accrued later than the time of her arrest and subsequent arraignment. As discussed, the OAG Press Release indicates that plaintiff was arrested and arraigned no later than October 24, 2000. See Lees Decl. Exhibit B, supra, Point I.A. Because the November 19, 2004 filing date of this action is more than four years after October 24, 2000, plaintiff's state law false arrest claim is time-barred and must therefore be dismissed for failure to state a claim.
b. Malicious Prosecution
As noted above, SI Bluszcz does not seek dismissal of plaintiff's federal or state malicious prosecution claims on this motion. See Defendant Bluszcz's Memorandum of Law in Support of His Motion to Dismiss the Amended Complaint, dated May 27, 2005, at 14 n. 4.
Conclusion
For the aforementioned reasons, the motions of Victoria Home and SI Bluszcz are granted and the claims against Ramirez are dismissed sua sponte. The remaining malicious prosecution claim (pursuant to § 1983 and state law) against SI Bluszcz will proceed accordingly. Counsel for plaintiff and defendant SI Bluszcz are required to appear at a scheduling conference on Friday, July 15, 2005, at 10:00a.m. Counsel for defendants Victoria Home and Ramirez need not attend.
This constitutes the decision and order of the court.
NOTES
[1] The press release may be considered on this motion to dismiss because plaintiff references it in paragraph 64 of the Amended Complaint and because this Court may take judicial notice of it as a matter of public record. See, e.g., Chambers v. Time Warner, Inc., 282 F.3d 147, 153 (2d Cir.2002) (holding that, on Rule 12(b)(6) motion, "complaint" includes all papers and exhibits appended to the complaint, all documents incorporated by reference in the complaint, any matters of which judicial notice may be taken, and any documents that plaintiff either possessed or had knowledge of and relied on in bringing suit); Kramer v. Time Warner Inc., 937 F.2d 767, 774 (2d Cir.1991)(courts may take judicial notice of public documents).
[2] The other causes of action are listed strictly as state law claims pursuant to the Court's supplemental jurisdiction under 28 U.S.C. § 1367.
[3] The right against false imprisonment in the criminal prosecution context extends only to pre-trial detention, rendering false arrest and false imprisonment synonymous. See, e.g., Heck v. Humphrey, 512 U.S. 477, 484, 114 S.Ct. 2364, 2367, 129 L.Ed.2d 383 (1994) (holding that "[i]f there is a false arrest claim, damages for that claim cover the time of detention up until issuance of process or arraignment, but not more"). Accordingly, plaintiff cannot challenge her post-sentencing imprisonment via a false imprisonment claim, whether such claim is premised on federal or state law. See id.; Singer, 63 F.3d at 117 (holding that post-arraignment deprivation of liberty implicates malicious prosecution rather than false arrest).
[4] Contrary to plaintiff's representation, Huff v. State, 47 Misc.2d 1053, 263 N.Y.S.2d 897 (1965), reversed in part, 27 A.D.2d 892, 278 N.Y.S.2d 12 (3d Dep't 1967), does not undermine the authority of Molyneaux and its progeny as they apply to plaintiff's case. Huff' s inaccurate reading of Molyneaux and erroneous ruling on the accrual of false arrest/false imprisonment claims were overruled on appeal to the Appellate Division, which confirmed that a false arrest claim accrues at the time of arraignment. Huff, 27 A.D.2d at 892, 278 N.Y.S.2d at 13 (citing Molyneaux); see also Olson v. State, 71 Misc.2d 1009, 1011, 338 N.Y.S.2d 198, 200 (1972)(noting Appellate Division's reversal of lower court in Huff and accordingly dismissing false arrest and false imprisonment claims as untimely).
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 19-7242
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
RICKY MCKINLEY INGRAM,
Defendant - Appellant.
Appeal from the United States District Court for the Middle District of North Carolina, at
Greensboro. Thomas D. Schroeder, Chief District Judge. (1:06-cr-00460-TDS-1)
Submitted: April 16, 2020 Decided: April 20, 2020
Before GREGORY, Chief Judge, and WYNN and DIAZ, Circuit Judges.
Affirmed by unpublished per curiam opinion.
Louis C. Allen, Federal Public Defender, Eric D. Placke, First Assistant Federal Public
Defender, OFFICE OF THE FEDERAL PUBLIC DEFENDER, Greensboro, North
Carolina, for Appellant. Matthew G.T. Martin, United States Attorney, Angela H. Miller,
Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY,
Greensboro, North Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Through counsel, Ricky McKinley Ingram appeals the district court’s order denying
his motion, filed pursuant to the First Step Act of 2018, Pub. L. No. 115-391, § 404, 132
Stat. 5194, 5222, for a reduction in Ingram’s 262-month sentence. We have considered
Ingram’s arguments on appeal in conjunction with the record and find the court did not
abuse its discretion in declining to reduce Ingram’s custodial sentence. Accordingly, we
affirm for the reasons stated by the district court. United States v. Ingram, No. 1:06-cr-
00460-TDS-1 (M.D.N.C. Aug. 21, 2019). 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.
AFFIRMED
2
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544 U.S. 968
WILLIAMSv.UNITED STATES.
No. 04-9014.
Supreme Court of United States.
April 4, 2005.
1
C. A. 7th Cir. Certiorari denied.
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573 F.2d 1297
U. S.v.Cole
No. 77-1265, 77-1266, 77-1309
United States Court of Appeals, Second Circuit
10/14/77
1
W.D.N.Y.
2
AFFIRMED*
*
Oral opinion delivered in open court in the belief that no jurisprudential purpose would be served by a written opinion. An oral opinion or a summary order is not citable as precedent. Local Rule Sec. 0.23
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In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 16-4234
DELORES HENRY, et al., on behalf of a class,
Plaintiffs-Appellants,
v.
MELODY HULETT, former Warden of Lincoln Correctional
Center, et al.,
Defendants-Appellees.
____________________
Appeal from the United States District Court
for the Central District of Illinois.
No. 12-CV-3087 — Richard Mills, Judge.
____________________
ARGUED NOVEMBER 30, 2017 — DECIDED JULY 16, 2019
____________________
Before EASTERBROOK and MANION, Circuit Judges, and
JOHN Z. LEE, District Judge. *
EASTERBROOK, Circuit Judge. Members of a certified class
contend that during 2011 female inmates at an Illinois prison
were strip-searched as part of a training exercise for cadet
* Of the Northern District of Illinois, sitting by designation.
2 No. 16-4234
guards. The district court summarized the allegations this
way:
[Plaintiffs] were required to stand naked, nearly shoulder to
shoulder with 8-10 other inmates in a room where they could be
seen by others not conducting the searches, including male offic-
ers. Menstruating inmates had to remove their tampons and san-
itary pads in front of others, were not given replacements, and
many got blood on their bodies and clothing and blood on the
floor. The naked inmates had to stand barefoot on a floor dirty
with menstrual blood and raise their breasts, lift their hair, turn
around, bend over, spread their buttocks and vaginas, and cough.
2016 U.S. Dist. LEXIS 194393 at *6 (C.D. Ill. Apr. 14, 2016).
Plaintiffs maintained that such an inspection—unnecessary
for security and conducted in an offensive manner—violated
their rights under both the Fourth Amendment and the
Eighth Amendment, applied to the states by the Due Process
Clause of the Fourteenth Amendment and 42 U.S.C. §1983.
The district court awarded summary judgment to defend-
ants on the Fourth Amendment theory, because Johnson v.
Phelan, 69 F.3d 144 (7th Cir. 1995), and King v. McCarty, 781
F.3d 889 (7th Cir. 2015), hold that a visual inspection of a con-
victed prisoner is not subject to analysis under that amend-
ment, though a claim properly lies under the Eighth Amend-
ment if an unnecessary or demeaning inspection amounts to
punishment. The Eighth Amendment claim went to trial, and
a jury returned a verdict for the defendants. Plaintiffs do not
contest the verdict but ask us to reinstate their Fourth Amend-
ment theory. Because analysis under the Fourth Amendment
is objective, see Graham v. Connor, 490 U.S. 386 (1989), while a
successful claim under the Eighth Amendment depends on
proof of a culpable mental state, see Whitley v. Albers, 475 U.S.
No. 16-4234 3
312 (1986), plaintiffs believe that they could succeed on a
Fourth Amendment theory despite the jury’s verdict.
The Fourth Amendment applies only to the extent that
prisoners retain a legitimate expectation of privacy. Johnson
and King rely on Hudson v. Palmer, 468 U.S. 517, 524–30 (1984),
which holds that prisoners lack privacy interests in their cells
and implies that they lack any legitimate expectation of pri-
vacy inside prison walls. The judgments of conviction allow
wardens to control and monitor their charges’ lives, extin-
guishing the rights of secrecy and seclusion that free people
possess. But Hudson did not consider whether convicted pris-
oners have some residual privacy interest in their persons, as
opposed to their possessions and surroundings. The Justices
have not returned to that subject in later decisions. Decisions
in this circuit look in both directions on that topic. Compare
King with, e.g., Peckham v. Wisconsin Department of Corrections,
141 F.3d 694 (7th Cir. 1998).
King reconciles the circuit’s competing strands of thought
this way: the Fourth Amendment does not apply to visual in-
spections of convicted prisoners but does apply to procedures
that entail intrusions within prisoners’ bodies. 781 F.3d at
899–901. That approach is justified not only by the holding of
Hudson but also by the need to maintain the subjective com-
ponent of Eighth Amendment analysis. In decisions such as
Whitley the Justices stressed that guards will take many steps
that offend and even injure prisoners, yet contribute to prison
management and security. Only those steps that are unneces-
sary and intended to produce injury, the Court explained,
should be actionable.
An appropriate balance of prisoners’ interests against the
needs of prison management is achieved through normal
4 No. 16-4234
Eighth Amendment analysis, which has both objective and
subjective elements. See also, e.g., Helling v. McKinney, 509
U.S. 25 (1993); Farmer v. Brennan, 511 U.S. 825 (1994). Apply-
ing the Fourth Amendment to all unwelcome observations of
prisoners would eliminate the subjective component and cre-
ate a sort of Eighth Amendment lite, defeating the objectives
that the Justices sought to achieve by limiting liability in Whit-
ley and similar decisions. See King, 781 F.3d at 900–01.
Even when the Fourth Amendment or the Due Process
Clause applies, as one or the other will before conviction, strip
searches often are reasonable and thus permissible. See Flor-
ence v. Board of Freeholders, 566 U.S. 318 (2012); Bell v. Wolfish,
441 U.S. 520, 558–60 (1979). But the absence of a subjective
component in determining what is reasonable under the
Fourth Amendment would produce outcomes that depart
from the approach required by Whitley for prisoners after con-
viction. It would effectively equate the rights of convicted
prisoners with those of arrestees or pretrial detainees. Many
decisions hold that convicts’ rights are more limited.
King obliged the district judge to resolve this case as he
did. Plaintiffs allege a visual inspection, not a physical intru-
sion. They maintain that each inmate had to manipulate her
own body but do not contend that the prison’s staff touched
any inmate. A prisoner’s need to touch her own body does not
differentiate this situation from that of Florence, which con-
cluded that a visual inspection (visual on the guards’ part) is
reasonable even with respect to pretrial detainees.
Plaintiffs ask us to overrule Johnson and King to the extent
that they deem the Fourth Amendment inapplicable to visual
inspections of convicted prisoners. We decline.
No. 16-4234 5
The law in some other circuits is favorable to plaintiffs. See,
e.g., Harris v. Miller, 818 F.3d 49, 57 (2d Cir. 2016); Hutchins v.
McDaniels, 512 F.3d 193, 196 (5th Cir. 2007). The law in this
circuit does not favor plaintiffs, however, and decisions such
as Hudson are at best neutral. If the flat declaration in Hudson
that a prisoner lacks any legitimate expectation of privacy in
a cell, 468 U.S. at 526, applies only while the prisoner is in a
cell, that still falls short of establishing that the Fourth
Amendment applies elsewhere in a prison. And we know
from Samson v. California, 547 U.S. 843 (2006), that even after
conditional release a convicted person has a severely dimin-
ished expectation of privacy until the end of the sentence.
Samson allowed a parolee to be searched without either prob-
able cause or suspicion, and it stressed the extent to which a
conviction curtails privacy.
The most one can say for plaintiffs is that judges, including
those within the Seventh Circuit, have disagreed about
whether the Fourth Amendment ever prevents guards from
viewing naked prisoners. Johnson was decided over a dissent.
A concurring opinion in King expressed doubt about the ma-
jority’s analysis, as a concurring opinion in Peckham expressed
doubt about the analysis of the majority there.
It has been 35 years since the Justices last considered the
extent to which convicted prisoners have rights under the
Fourth Amendment while still inside prison walls. For more
than 20 years it has been established in this circuit that the
Fourth Amendment does not apply to visual inspections of
prisoners. It is best to leave the law of the circuit alone, unless
and until the Justices suggest that it needs change.
AFFIRMED
6 No. 16-4234
LEE, District Judge, dissenting. In prior decisions, we have
recognized that convicted prisoners have a reasonable expec-
tation of privacy in the interior of their bodies sufficient to
trigger the Fourth Amendment’s safeguard against unreason-
able searches (although, as we shall see, this line differentiat-
ing a prisoner’s bodily interior versus exterior is not man-
dated by Supreme Court precedent, recognized by any of our
sister circuits, or even uniformly applied by this Court, see
King v. McCarty, 781 F.3d 889, 902–04 (7th Cir. 2015) (Hamil-
ton, J., concurring in part and concurring in judgment)). To
this rule, the majority now appends an additional hurdle—a
prisoner can invoke the Fourth Amendment only when the
physical intrusion into her body is carried out by someone
other than the prisoner herself; this is the case even when a
prisoner is ordered by correctional officers to probe into her
own body. Because this new rule is not supported by our
prior decisions or consistent with established Fourth Amend-
ment jurisprudence, I respectfully dissent.
In Hudson v. Palmer, the Supreme Court held that prisoners
do not have a reasonable expectation of privacy as to their liv-
ing quarters or possessions. 468 U.S. 517, 525–26 (1984). But
the Supreme Court has yet to address whether (and to what
extent) prisoners maintain a reasonable expectation of pri-
vacy as to their persons when it comes to strip searches. Since
Hudson, this court has taken various, sometimes inconsistent,
tacks to answer this question. Compare Peckham v. Wis. Dep’t of
Corr., 141 F.3d 694, 697 (1998) (“So, does a prison inmate enjoy
any protection at all under the Fourth Amendment against
unreasonable searches and seizures? … [W]e think the answer
is ‘yes,’…”); Canedy v. Boardman, 16 F.3d 183, 185–86 (7th Cir.
1994) (applying Fourth Amendment reasonableness test es-
poused in Bell v. Wolfish, 441 U.S. 520 (1979), to strip searches),
No. 16-4234 7
with Johnson v. Phelan, 69 F.3d 144, 147 (7th Cir. 1995) (inter-
preting “Canedy and similar cases” as applying only the
Eighth Amendment, not the Fourth); King, 781 F.3d at 899–900
(no reasonable expectation of privacy where inmate was re-
quired to wear see-through clothes for transport).
Our prior decisions, however, seem to coalesce around the
following rule—that prisoners retain a legitimate expectation
of privacy as to the insides of their bodies, if not the outsides.
And so, in Forbes v. Trigg, 976 F.2d 308, 312–13, 315 (1992), we
held that “[u]rine tests are searches for Fourth Amendment
purposes, and prison inmates retain protected privacy rights
in their bodies, although these rights do not extend to their
surroundings.” Id. at 312. In Del Raine v. Williford, we ex-
plained that a rectal search conducted by a guard “falls un-
der” the protection of the Fourth Amendment. 32 F.3d 1024,
1039 (7th Cir. 1994). And in Sparks v. Stutler, we assumed that
the involuntary catheterization of an inmate was subject to the
Fourth Amendment’s protections. 71 F.3d 259, 261–62 (7th
Cir. 1995) (“Certainly Hudson does not establish that the inte-
rior of one’s body is as open to invasion as the interior of one’s
cell.”).
This rule, which recognizes an inmate’s right to privacy in
her body (albeit, we have held, to a limited degree), finds
some support in prior Supreme Court decisions. For instance,
in Winston v. Lee, the Supreme Court held that a criminal de-
fendant’s expectation of privacy in the inside of his body ren-
dered unreasonable a compelled surgery to obtain evidence.
470 U.S. 753, 758–60 (1985). And in Bell, the Supreme Court
assumed without deciding that pretrial detainees had a legit-
imate expectation of privacy as to body-cavity searches. 441
8 No. 16-4234
U.S. at 558; see also Florence v. Bd. of Chosen Freeholders of Cty.
of Burlington, 566 U.S. 318, 326–27 (2012).
At the same time, extending the limiting principle in Hud-
son, we have refused to recognize a reasonable expectation of
privacy as to the exterior of inmates’ bodies. For instance, in
Johnson, we held that opposite-sex monitoring in the prison,
which led to female guards frequently observing male in-
mates in various states of undress, did not implicate privacy
concerns under the Fourth Amendment. 69 F.3d at 145–47. We
reached a similar conclusion in King, which involved an in-
mate who was forced to wear a jumpsuit that was “less than
opaque,” making his genitals and buttocks visible to those
around him. 781 F.3d at 893, 899–900.
But this rule—distinguishing between a prisoner’s insides
and outsides—has not been pronounced by the Supreme
Court or adopted by any other circuit. And its legal founda-
tion has been questioned. See id. at 903 (Hamilton, J., concur-
ring in part and concurring in judgment) (noting that “no
other circuit applies the categorical rule … finding no Fourth
Amendment protection against strip-searches or nudity”).
To this, the majority now attaches the added requirement
that, for a prisoner to possess a reasonable expectation of pri-
vacy as to the interior of her body, the intrusion of her insides
must be performed by someone else. And because in this case
“each inmate had to manipulate her own body but do not con-
tend that the prison’s staff touched any inmate,” the majority
concludes that the prisoners lacked any reasonable expecta-
tion of privacy here.
It seems odd, however, to make the question of whether a
prisoner has a reasonable expectation of privacy under the
No. 16-4234 9
Fourth Amendment in the integrity of his or her intimate
body cavities dependent on who it is that does the probing or
penetrating. After all, the applicability of the Fourth Amend-
ment hinges on (1) whether an individual has an actual, sub-
jective expectation of privacy in the subject of the search, and
(2) whether that expectation is “one that society is prepared
to recognize as reasonable.” Katz v. United States, 389 U.S. 347,
361 (1967) (Harlan, J., concurring); see Hudson, 468 U.S. at 525.
The focus of this inquiry is on an individual’s expectation of
privacy “in what was searched,” not who did the searching.
United States v. Scott, 731 F.3d 659, 663 (7th Cir. 2013) (empha-
sis added); see United States v. Villegas, 495 F.3d 761, 767 (7th
Cir. 2007) (“[W]hether a legitimate expectation of privacy ex-
ists in a particular place or thing must be determined on a
case-by-case basis.”) (internal quotation marks omitted). The
manner in which a search is conducted is more appropriately
addressed when assessing its reasonableness. See Bell, 441
U.S. at 559.
The facts of this case illustrate the ungainliness of the ma-
jority’s new rule. Construing the record in Appellants’ favor,
as we must on summary judgment, approximately 200 female
inmates were rounded up early one morning by a tactical
team in riot gear. R110-3 at 5. Tightly handcuffed by guards
who screamed obscenities at them, the women were taken to
the gym, where they remained, handcuffed and standing, un-
til the guards searched them. Id. The women were not told
what was happening or why. R110-9. This mass strip search
of female inmates was conducted solely for training purposes,
R.110-6 at 76:7–76:10, but the training was not strictly neces-
sary, as most cadets graduated without it. R974–75.
10 No. 16-4234
The searches took place in a beauty salon and a bathroom
off the gym. R110-3. Because the beauty shop had mirrored
walls, and the bathroom entry was open to the gym, the
searches were visible to the people in the gym, including male
and female cadets, correctional officers, and civilians. Id.
During the searches, the women stood naked in groups of
four to ten, so close to one another that their bodies were
touching. Id. One by one, they were told to raise their breasts,
bend over, spread their buttocks to expose their vaginal and
anal cavities, and cough. Id. Menstruating inmates were
forced to extract tampons from inside their bodies. Id. The fe-
male correctional officers and cadets conducting the searches
made derogatory comments and gestures about the women’s
bodies and odors, telling the women that they were “dirty
bitches,” R110-9 at 2, “fucking disgusting,” “deserve to be in
here,” R110-9 at 14, and “smell like death.” R110-9 at 36. Male
correctional officers watched the women from the gym. R110-
3.
The majority holds that the female prisoners have no re-
course to the Fourth Amendment because it was they them-
selves who manipulated and intruded upon their own bodies
(although, of course, they had no choice because they were
ordered to do so). But surely the collecting of urine in Forbes,
976 F.2d at 315, the catherization challenged in Sparks,
see 71 F.3d at 261–62, or the rectal probing in Del Raine,
see 32 F.3d at 1039, would not fall outside the Fourth Amend-
ment if the prisoners were forced to perform the acts them-
selves. The distinction between those cases and this one—in
which inmates were ordered to probe their own body cavities
and subject them to visual inspection—is difficult to discern.
No. 16-4234 11
Our recent decision in King did confuse the matter some-
what by drawing a line between “intrusions into [prisoners’]
bodies”—which we acknowledged might be unreasonable
under the Fourth Amendment—and searches involving no
such “intrusion.” 781 F.3d at 900. The majority seizes on that
language, concluding that any search conducted through only
visual means—regardless of the subject of the search
(whether insides or outsides) or how that visual inspection
was achieved (such as by forcing prisoners to probe and ma-
nipulate their own bodies)—is not amenable to Fourth
Amendment protection. But I think this reads too much into
King.
Remember that the initial inquiry under the Fourth
Amendment asks whether the person searched has a legiti-
mate expectation of privacy in the place or thing searched—
not whether the method of the search implicates a reasonable
expectation of privacy. Accordingly, I read King’s reference to
“intrusions” to merely restate the rule in this circuit that pris-
oners retain some expectation of privacy in the insides of their
bodies; after all, King did not involve physical “intrusions” of
any kind. The means of a search, in my view, are still more
pertinent to the second inquiry under the Fourth Amend-
ment—whether the search conducted was reasonable.
The majority also draws support from the existence of the
Eighth Amendment, which it feels is a superior vehicle for
Appellants’ claims. This position reflects a concern with re-
taining the subjective component of the Eighth Amend-
ment—the requirement that prisoners seeking to prove “cruel
and unusual punishment” show both (1) a violation of their
substantive rights and (2) a culpable mental state. See Whitley
v. Albers, 475 U.S. 312, 319–20 (1986). Because the Fourth
12 No. 16-4234
Amendment’s inquiry involves only a determination of “rea-
sonableness,” the majority posits, applying it to prison offi-
cials’ conduct “would eliminate the subjective component”
required under the Eighth Amendment and would equate
convicted prisoners with pretrial detainees.
To be sure, we have recognized that “it is the Eighth
Amendment that is more properly posed to protect inmates
from unconstitutional strip searches, notably when their aim
is punishment, not legitimate institutional concerns.” Peck-
ham, 141 F.3d at 697; see also King, 781 F.3d at 899–900 (distin-
guishing between the Fourth and Eighth Amendments); John-
son, 69 F.3d at 147 (explaining that the Eighth Amendment
could be used to “overcome calculated harassment unrelated
to prison needs”) (quoting Hudson, 468 U.S. at 530). But I dis-
agree that the Eighth Amendment is superior in all circum-
stances, or that the application of the Fourth Amendment in
this context would simply be redundant of the Eighth
Amendment. Cf. Peckham, 141 F.3d at 699 (Easterbrook, J., con-
curring) (“If the only way to use the fourth amendment in
strip-search cases is to make it functionally identical to the
cruel and unusual punishments clause, then what’s the
point?”).
First, the notion that prisoners may have overlapping con-
stitutional rights is not an alien concept. In fact, we already
recognize that prisoners retain other constitutional rights de-
spite the existence of the Eighth Amendment. For instance, an
inmate has due process rights as to discipline received in
prison, even though such discipline might be considered
“punishment” under the Eighth Amendment. See Wolff v.
McDonnell, 418 U.S. 539, 555–56 (1974). And an inmate who is
barred from practicing his or her religion or from accessing
No. 16-4234 13
the courts may turn to the First Amendment for redress. See
O’Lone v. Estate of Shabazz, 482 U.S. 342, 348–49 (1987); Hudson,
468 U.S. at 523. The existence of overlapping rights in the Con-
stitution does not require that one right yield to another, but
rather suggests that certain spheres of life are constitutionally
entitled to greater protection. As we have seen, religion and
speech are two of those areas; I would argue that the right to
be free from arbitrary searches by the government of one’s in-
sides is another.
Of course, this is not to say that inspections like the one
conducted here are categorically prohibited by the Fourth
Amendment. The concept of reasonableness under the Fourth
Amendment is elastic enough to account for the legitimate
needs of prisons, and we always must be mindful that prison
administrators should be accorded “wide-ranging deference
in the adoption and execution of policies and practices that in
their judgment are needed to preserve internal order and dis-
cipline and to maintain institutional security.” Bell, 441 U.S.
at 547; see also Florence, 566 U.S. at 328 (courts should defer to
the expert judgment of correctional officers unless substantial
evidence indicates that those officers exaggerated their re-
sponses to security concerns). Indeed, courts in other circuits
typically defer to prison administrators and uphold searches
under the Fourth Amendment, unless the intrusion on a pris-
oner’s privacy is widely disproportionate to the purported
justification for the search. See, e.g., Lewis v. Sec’y of Pub. Safety
& Corr., 870 F.3d 365, 368–69 (5th Cir. 2017) (upholding as rea-
sonable visual body-cavity searches of groups of prisoners re-
turning from work duty); Nunez v. Duncan, 591 F.3d 1217,
1226–28 (9th Cir. 2010) (upholding a visual body-cavity search
where the prisoner failed to present evidence that it was un-
reasonable); Franklin v. Lockhart, 883 F.2d 654, 656–57 (8th Cir.
14 No. 16-4234
1989) (holding that visual body-cavity searches did not vio-
late the Fourth Amendment because they were justified by
“legitimate security concerns”).
Furthermore, this case illustrates why there is still a dis-
tinct role for the Fourth Amendment in prisons. Here, alt-
hough Appellees now attempt to craft a security-based justi-
fication for the searches, the summary judgment record indi-
cates that the primary reason was training. Surely a “training”
justification need not be treated with the same level of defer-
ence as a search conducted due to concerns over smuggled
weapons or other contraband? It is rationales like this—that
fall somewhere between legitimate security concerns and un-
justified harassment—that suggest the continuing need for
the Fourth Amendment even in prisons.
In this case, I would start by asking if the prisoners in
question had a legitimate expectation of privacy in the subject
of the searches—i.e., in the insides of their bodies and body
cavities. To that I would answer yes, and I believe that answer
would be supported by precedent in this circuit, although it
still needs decisive resolution. See, e.g., Sparks, 71 F.3d at 261–
62; Del Raine, 32 F.3d at 1039; Forbes, 976 F.2d at 312–13.
Only after concluding that a protectible interest exists
would I address the searches’ justification and methodology
in the context of deciding whether the searches were reason-
able. This question of reasonableness necessarily requires “a
balancing of the need for the particular search against the in-
vasion of personal rights that the search entails,” including
“the scope of the particular intrusion, the manner in which it
is conducted, the justification for initiating it, and the place in
which it is conducted.” Bell, 441 U.S. at 559. This two-step ap-
proach is precisely what was done in Florence. See 566 U.S. at
No. 16-4234 15
325–38 (considering a variety of administrative factors in de-
termining whether a search was reasonable as to pretrial de-
tainees). Because the district court in this case ended its
Fourth Amendment analysis after deciding that Appellants
had no legitimate expectation of privacy, I would vacate and
remand for full consideration of the reasonableness factors.
As a final note, the peculiar circumstances of this case raise
the question of whether the time has come for this Court to
reconsider its broader position with respect to the application
of the Fourth Amendment to inmates’ bodies generally. As
the concurring opinion in King pointed out, the distinction
this Court has drawn between the interior and exterior of a
prisoner’s body was not required by the Supreme Court in
Hudson or any subsequent case. See 781 F.3d at 902–04 (Ham-
ilton, J., concurring in part and concurring in judgment). And
a position recognizing an inmate’s expectation of privacy in
his or her body—inside and out—would be consistent with
that of every other circuit to have addressed this issue; each
has assumed the application of the Fourth Amendment and
moved on to address the question of reasonableness. See gen-
erally Cookish v. Powell, 945 F.2d 441, 445–46 (1st Cir. 1991);
Harris v. Miller, 818 F.3d 49, 62–63 (2d Cir. 2016); Parkell v.
Danberg, 833 F.3d 313, 327, 330 (3d Cir. 2016); King v. Ru-
benstein, 825 F.3d 206, 215 (4th Cir. 2016); Lewis, 870 F.3d at
368–69; Stoudemire v. Mich. Dep’t of Corr., 705 F.3d 560, 575 (6th
Cir. 2013); Franklin v. Lockhart, 883 F.2d 654, 656–57 (8th Cir.
1989); Nunez, 591 F.3d at 1226–28; Farmer v. Perrill, 288 F.3d
1254, 1260 (10th Cir. 2002); Fortner v. Thomas, 983 F.2d 1024,
1030 (11th Cir. 1993).
For these reasons, I respectfully dissent.
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537 U.S. 1118
JOHNSONv.HINES, WARDEN, ET AL.
No. 02-7046.
Supreme Court of United States.
January 13, 2003.
1
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT.
2
C. A. 10th Cir. Certiorari denied. Reported below: 44 Fed. Appx. 434.
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United States Court of Appeals
FOR THE EIGHTH CIRCUIT
_____________
No. 01-3805NE
_____________
United States of America, *
*
Appellant, *
* On Appeal from the United
v. * States District Court
* for the District of
* Nebraska.
Raymond A. Butler, Jr., *
*
Appellee, *
___________
Submitted: June 11, 2002
Filed: July 18, 2002
___________
Before WOLLMAN, RICHARD S. ARNOLD, and LOKEN, Circuit Judges.
___________
RICHARD S. ARNOLD, Circuit Judge.
On April 18, 2001, Raymond Butler was indicted in connection with two bank
robberies in Omaha, Nebraska. On July 3, 2001, as part of a plea agreement, the
defendant pleaded guilty to two of the three counts in the indictment, robbery of the
Great Western Bank (Count I) and brandishing a firearm during the robbery of the
Union Pacific Streamliner Federal Credit Union (Count III).1 Before the sentencing
hearing, the defendant filed a motion for a downward departure. He argued that
application of the career-offender guideline was inappropriate because one of the two
prior felonies that brought him within that guideline was not serious enough to
warrant subjecting him to the career-offender enhancement.
On November 6, 2001, a sentencing hearing was held. The District Court
granted the defendant’s motion for a downward departure. The defendant received
a seven-year sentence of imprisonment (84 months) for the robbery and a mandatory
seven-year consecutive sentence for the firearm offense. See 18 U.S.C.
§ 924(c)(1)(A)(ii). The government appeals, arguing that the downward departure
was not justified. According to the government, the career-offender guideline should
have been applied, resulting in a sentence of at least 12 years and seven months (151
months) for the robbery. U.S.S.G. § 4B1.1.
I.
We review a departure from the Sentencing Guidelines for abuse of discretion.
United States v. Ross, 210 F.3d 916 (8th Cir.), cert. denied, 531 U.S. 969 (2000).
“[A]n abuse of discretion occurs when a relevant factor that should have been given
significant weight is not considered, when an irrelevant or improper factor is
considered and given significant weight, or when all proper and no improper factors
are considered, but the court in weighing the factors commits a clear error of
judgment.” United States v. McNeil, 90 F.3d 298, 300 (8th Cir.), cert. denied, 519
U.S. 1034 (1996) (internal citations omitted); accord, Kern v. TXO Prod. Corp., 738
F.2d 968, 970 (8th Cir. 1984).
1
The charge of brandishing a firearm during the commission of the robbery of
the Great Western Bank (Count II) was dismissed pursuant to the plea agreement.
-2-
To receive the career-offender enhancement, a defendant must be at least
eighteen years old at the time that the instant offense was committed, the instant
offense must be a crime of violence, and the defendant must have at least two prior
felony convictions for crimes of violence. United States v. Peters, 215 F.3d 861, 862
(8th Cir. 2000); U.S.S.G. § 4B1.1. The defendant in this case does not contest that
he has the two prior felony convictions, robbery and sexual assault in the first degree,
or that the other career-offender criteria are met. Instead, he alleges that application
of the career-offender enhancement would overstate the seriousness of his prior
criminal record. Specifically, he contends that his conviction for robbery in 1988,
though “technically” a crime of violence, was essentially a non-violent crime. He
argues that because the robbery occurred in the daytime, he took precautions to be
sure that the house was not occupied, he took only three items, and he was only
seventeen years old when he committed the offense, the career-offender enhancement
overstates the seriousness of his conduct. The District Court agreed with the
defendant’s characterization of the nature of the robbery conviction and departed
downward. We hold that the District Court abused its discretion by failing to give
sufficient weight to the defendant’s felony conviction for sexual assault in the first
degree.
II.
A district court has authority to depart downward from the applicable
sentencing range if a “defendant’s criminal history category significantly
overrepresents the seriousness of the defendant’s past criminal conduct.” United
States v. Gayles, 1 F.3d 735, 739 (8th Cir. 1993); and see United States v. Brown, 903
F.2d 540, 545 (8th Cir. 1990). In analyzing a district court’s departure from the
Guidelines, we “must evaluate, first, whether the circumstances relied upon [by the
district court] are sufficiently unusual to warrant departure; second, whether the
district court clearly erred in finding the historical facts that could justify departure;
and third, whether the sentence was reasonable, giving due deference to the
-3-
sentencing court’s superior position and considering the statutory goal of sentencing.”
United States v. Senior, 935 F.2d 149, 151 (8th Cir. 1991) (internal quotations
omitted).
In United States v. McNeil, supra, we held that a district court abused its
discretion when it granted a defendant a downward departure because the career-
offender guideline overstated the defendant’s criminal history. Though the District
Court correctly determined that the defendant qualified for the enhancement, the
Court emphasized the fact that the defendant was only seventeen when he committed
the requisite felonies. In vacating the sentence imposed, we stated that the decision
of the District Court to depart downward must “accurately reflect the entire record of
the defendant’s criminal history.” Id. at 301. The presentence investigation report
in that case revealed that the defendant’s criminal activity began when he was only
eight years old. Since that time his criminal record had grown to include multiple
convictions for breaking and entering and assault, as well as felony convictions for
taking indecent liberties with children, breaking and entering into an automobile, and
sexual abuse. We concluded that nothing about the defendant’s “long and continuing
criminal career was overstated by the application of the career offender guideline.”
Id. We believe that the same is true in the instant case.
Here, the defendant contends that the McNeil decision is inapplicable because
the defendant in that case committed more than the two felony convictions necessary
for the career-offender enhancement. We disagree. Though the defendant has been
convicted of only two felonies, these alone are sufficient to support the career-
offender sentencing enhancement. Moreover, while the District Court focused on the
non-violent nature of one of the defendant’s convictions, his conviction for robbery,
it did not mention the defendant’s conviction for sexual abuse when he was nineteen
years old. We cannot ignore the details of such a heinous crime. The offense was
described in the defendant’s Presentence Report (PSR) (to which both parties agreed)
as follows:
-4-
Offense reports indicate the victim . . . advised officers that
she heard a noise downstairs at her residence on 10/20/90.
When she went downstairs she saw a black male moving
her stereo. The suspect put a knife to her throat and forced
her upstairs where he sexually assaulted her. The victim
was sexually assaulted three times. The defendant forced
her to perform oral sex and anal sex. The victim was led to
believe that the defendant would possibly kill her. Butler
made three trips in and out of her home taking various
items. While he was gone the victim untied herself and
called her brother and the police. Medical reports
indicated sperm was found in the victim’s vagina and rectal
area.
PSR 13. The nature of this offense must be considered when determining whether the
career-offender enhancement overstates the seriousness of defendant’s past criminal
history. If, as the District Court thought, the robbery was not serious, even though
technically a crime of violence, the subsequent offense of sexual assault in the first
degree, a legalistic way of saying rape, was so serious, threatening, and violent as to
compensate, so to speak, for any mitigating aspects of the robbery.
Additionally, the defendant has a long and continuous history involving
numerous other crimes. Beginning when the defendant (age thirty when the instant
offenses were committed) was thirteen years old, he has been convicted of numerous
offenses. In fact, the PSR reveals that the only break in the defendant’s criminal
history occurred when he was incarcerated for the commission of the sexual assault,
between November 1990 and June 1999. Though his criminal history includes few
felonies, it does contain a violent sexual assault in which the victim was raped and
sodomized, as well as a large number of other offenses that indicate a pattern of
serious criminal activity.
-5-
Defendant argues that we should consider only the nature of the two felony
offenses that qualify him for the career-offender enhancement. We should disregard,
he says, the rest of his criminal history, because the question on appeal is not whether
the criminal history as a whole overstates the seriousness of defendant’s past conduct,
but whether application of the career-offender guideline overstates the effect of the
two prior felonies that were crimes of violence. In support of this position, the
defendant cites United States v. Smith, 909 F.2d 1164 (8th Cir. 1990), cert. denied,
498 U.S. 1032 (1991), and United States v. Senior, 935 F.2d 149 (8th Cir. 1991). The
government, in reply, cites United States v. McNeil, supra, 90 F.3d at 301. The
passage from McNeil relied on by the United States indicates the entire record of
criminal history should be considered. We find it unnecessary to resolve this conflict
between McNeil on the one hand and Brown and Senior on the other, if there really
is a conflict. Even if, as defendant urges, we limit our consideration to the nature of
the two felonies that qualify him for the career-offender enhancement, we still believe
the District Court abused its discretion. For reasons we have explained, when both
the robbery and the sexual assault in the first degree are considered, application of the
career-offender guideline does not overstate the seriousness of defendant’s conduct
that places him within that guideline.
III.
We applaud the District Court’s recognition that the Guidelines contain some
element of flexibility. We conclude, however, in the instant case that the Court
abused its discretion in not giving sufficient weight to the prior offense of sexual
assault in the first degree. The judgment of the District Court is reversed, and the
case is remanded for resentencing in a manner not inconsistent with this opinion.
It is so ordered.
-6-
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
-7-
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284 F.2d 143
UNITED STATES of America, Appellant,v.Hazel B. KASYNSKI, formerly Hazel B. Ainsworth, Appellee.
No. 6343.
United States Court of Appeals Tenth Circuit.
November 1, 1960.
James P. Turner, Atty., Dept. of Justice, Washington, D. C. (Charles K. Rice, Asst. Atty. Gen., Lee A. Jackson and Howard A. Heffron, Attys., Dept. of Justice, Washington, D. C., Donald G. Brotzman, U. S. Atty., and Richard P. Matsch, Asst. U. S. Atty., Denver, Colo, were with him on the brief), for appellant.
James H. Turner, Denver, Colo., for appellee.
Before PHILLIPS, LEWIS and BREITENSTEIN, Circuit Judges.
BREITENSTEIN, Circuit Judge.
1
The question is whether payments made to appellee, Kasynski, herein referred to as taxpayer, by the company of which her husband was president prior to his death were excludable gifts under § 22(b)(3) of the Internal Revenue Code of 1939 and § 102(a) of the 1954 Code or gross income within the meaning of § 22 (a) of the 1939 Code and § 61(a) of the 1954 Code, 26 U.S.C.A. §§ 22(a), (b)(3), 61(a), 102(a). The taxpayer reported these payments as income but subsequently filed a claim for refund of the taxes paid and this suit followed. The court below, holding that part of the sums paid was a gift and part was income, gave judgment for the taxpayer and the United States appeals.
2
The taxpayer was formerly the wife of A. W. Ainsworth who, before his death on February 18, 1952, was president of Wm. Ainsworth and Sons, Inc., a family-controlled Colorado corporation, at an annual salary of $30,000. Prior to her husband's death the taxpayer had been a stockholder, director, and secretary of the corporation receiving $1,800 annually for her services as secretary. On March 11, 1952, the Board of Directors of the corporation adopted the following resolution:
3
"That this corporation pay to Hazel B. Ainsworth, in recognition of the services rendered by her husband, A. W. Ainsworth, to this corporation, and in conformity with the regulations of the Treasury Department, and particularly Regulation 111, Section 29.23 (a-9), the sum of $2,500.00 per month, being the basic salary of her husband, for a period of two years beginning with March 1, 1952, and that during the period said payment was being paid to Mrs. Ainsworth, that this corporation discontinue the monthly salary now being paid to her as Secretary of the corporation."
4
Pursuant to this resolution, $60,000 was paid to the taxpayer over the years 1952, 1953, and 1954 at the rate of $2,500 monthly. The trial court found that a portion of this amount was for services rendered.1 The balance was held to be an excludable gift. Judgment was entered in favor of the taxpayer in the amount of $21,990.77.
5
The Government contends that the finding of a gift is unsupported by the evidence and is clearly erroneous because the payments were for services rendered by taxpayer's husband and because the record fails to show that the corporation's dominant reason for the payments was generosity, affection, charity or like impulses.
6
Both parties derive comfort from Commissioner of Internal Revenue v. Duberstein, 363 U.S. 278, 80 S.Ct. 1190, 1195, 4 L.Ed.2d 1218, decided since the entry of judgment in the case at bar. That decision disposed of two cases involving alleged gifts which the taxpayers contended should be excluded from gross income. Duberstein gave information as to potential customers to a corporation with which he had done business. The information proved helpful and the corporation gave Duberstein a Cadillac automobile as a present. The Tax Court found that the only justifiable inference was that the automobile was intended as remuneration for services rendered and affirmed the assessment of a deficiency. The Court of Appeals disagreed but the Supreme Court upheld the Tax Court. The other case involved one Stanton who, upon the termination of his services for a corporation, was paid $20,000 as a gratuity "in appreciation of the services rendered." Upon the assessment of a deficiency Stanton paid the tax and sued for its recovery. Judgment in his favor was reversed by the Court of Appeals. The Supreme Court deemed the findings of fact of the trial court to be inadequate and remanded the case to that court for further proceedings.
7
Duberstein rejected the Government's proposed test that "[g]ifts should be defined as transfers of property made for personal as distinguished from business reasons" and held that "primary weight in this area must be given to the conclusions of the trier of fact," with appellate review limited in a case such as this, tried by a judge without a jury, to a determination of whether the judge's findings are clearly erroneous. We take this to mean that no inflexible legal test can be applied in the determination of what is an excludable gift and that every case must stand upon its own facts.
8
The instant case was submitted on a stipulation of facts, the testimony of three of the directors, and certain exhibits consisting of income tax returns and corporate minutes. Whatever dispute there is relates to inferences drawn from the facts rather than the facts themselves.
9
Ainsworth, who had been an officer of the corporation for 30 years prior to his death, had been paid for all services rendered by him. The payments in question were not made to Ainsworth's estate but to his widow. These payments were made in recognition and appreciation of the services which he had rendered. The corporation was under no obligation to make the payments and did so voluntarily. The taxpayer was not required to render services or give anything of value in return for the payments. The corporation had no plan, policy or custom of making payments to widows of its deceased officers or employees. The corporation did not carry the payments on its books as salary and did not deduct social security or withholding taxes but did claim a deduction on its tax returns on account of such payments. Three directors testified that they intended the payments to be a gift to the taxpayer.
10
In rejecting the test suggested by the Government, the Supreme Court in Duberstein did recognize certain guiding principles which should be applied to the facts in determining whether there was a gift. A transfer without consideration is not necessarily a gift within the meaning of the statute. If the payment proceeds primarily from the impulsion of a moral or legal duty or from the incentive of an anticipated economic benefit, it is not a gift. If the transfer results from a "`detached and disinterested generosity'" arising "`out of affection, respect, admiration, charity or like impulses,'" it is a gift.2 The most critical consideration is the transferor's intention. This requires an objective inquiry in which the hopes and expectations of tax treatment are immaterial. The proper criterion requires determination of the dominant reason for the transfer.3
11
The argument of Government counsel resolves itself into the concept that a corporation cannot and may not have the personalized feelings which are required by the principles recognized in Duberstein. This is but a reargument of the Government contention that a gift must be made for "personal rather than business reasons." In Duberstein, each of the transferors was a corporation and the court, after commenting that under the proposed Government test there could ordinarily be no such thing as a gift by a corporation within the purview of the tax statutes, declined to accept the vagaries of local corporate law as a determinative factor.4
12
Against this background we must decide whether the findings of the trial court are clearly erroneous. The key is the intention of the transferor and the court held that the intent was to make a gift. That is a reasonable inference from the factual pattern which is presented. For us to hold otherwise would be the substitution of our inference for the inference drawn by the trier of the facts. This we may not do.5 On a review of the entire record we do not have "the definite and firm conviction that a mistake has been committed."6
13
This exhausts the limits of appellate review if it were not for the claim of the Government that the findings are insufficient to satisfy the requirements of Rule 52(a), F.R.Civ.P., 28 U.S.C.A., because they do not reveal the reasons which persuaded the court to hold that there was a gift. In support of this point the Government again relies on Duberstein which held that the lower court findings as to the gift to Stanton were inadequate and remanded the case for further proceedings. There, the Court made only oral findings as to the transfer to Stanton and in so doing found in a general and conclusory manner that the transfer was a gift. Here we have carefully prepared written findings analyzing the transactions, discriminating between payments made for services rendered and payments made for another purpose, and finding that the payments made for this other purpose were "intended as a gift." This was an express recognition of the dominant criterion approved by Duberstein. Elaboration by the court of the reasons which persuaded it to find such intent would have been a violation of the rule against prolixity, and Duberstein directs that prolixity should be avoided.7 The findings indicate "the legal standard with which the trier of fact has approached his task."8
14
Affirmed.
Notes:
1
This accords with the testimony of the attorney for the company, who was also a director, that the $30,000 annual payment was to include what was due taxpayer for services rendered as secretary. The compensation for such services was determined to be $150 per month for 10 months of 1952 and all of 1953 and $650 monthly for two months of 1954. The United States does not question these amounts
2
363 U.S. 285, 80 S.Ct. 1197
3
Ibid., 363 U.S. at page 286, 80 S.Ct. at page 1197
4
Ibid., 363 U.S. at page 288, 80 S.Ct. at page 1198
5
Homestake Mining Company v. Mid-Continent Exploration Company, 10 Cir., 282 F.2d 787, and cases cited in footnote 15
6
United States v. United States Gypsum Co., 333 U.S. 364, 395, 68 S.Ct. 525, 542, 92 L.Ed. 746, rehearing denied 333 U.S. 869, 68 S.Ct. 788, 92 L.Ed. 1147
7
Commissioner of Internal Revenue v. Duberstein, supra, 363 U.S. at page 292, 80 S.Ct. at page 1200
8
Ibid
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F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
OCT 28 1997
TENTH CIRCUIT
PATRICK FISHER
Clerk
TYRONE PETER DARKS,
Plaintiff - Appellant,
v.
No. 97-7036
FRANK KEATING, Governor of (D.C. No. 96-CV-166-S)
Oklahoma; DREW EDMONDSON, (Eastern District of Oklahoma)
Oklahoma State Attorney General;
STATE OF OKLAHOMA,
Defendants - Appellees.
ORDER AND JUDGMENT *
Before TACHA, BALDOCK and LUCERO, Circuit Judges.
Upon careful consideration of the record, the briefs of the parties, the
district court’s order, and the applicable law, we AFFIRM for substantially the
reasons stated in the district court’s order.
The mandate shall issue forthwith.
ENTERED FOR THE COURT
Carlos F. Lucero
Circuit Judge
*
The case is unanimously ordered submitted without oral argument pursuant to Fed. R. App. P.
34(a) and 10th Cir. R. 34.1.9. This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court generally disfavors the
citation of orders and judgments; nevertheless, an order and judgment may be cited under the terms and
conditions of 10th Cir. R. 36.3.
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253 F.2d 710
Richard Vaughn JENKINS, Appellant,v.UNITED STATES of America, Appellee.
No. 16846.
United States Court of Appeals Fifth Circuit.
April 7, 1958.
Rehearing Denied May 16, 1958.
Stonewall H. Dyer, Atlanta, Ga., for appellant.
James W. Dorsey, U. S. Atty., John W. Stokes, Jr., Asst. U. S. Atty., Atlanta, Ga., for appellee.
Before HUTCHESON, Chief Judge, and JONES and BROWN, Circuit Judges.
PER CURIAM.
1
The appellant, Richard Vaughn Jenkins, purchased whiskey from retail liquor dealers in varying quantities ranging from twenty to over a hundred cases a week and these he sold during 1953, 1954, and 1955, to clubs in the dry counties in the Northern part of Georgia. He was indicted, convicted and sentenced for conspiracy to sell liquor at wholesale without the Federal wholesaler's tax being paid as required by 26 U.S.C.A. § 5111. From the judgment of conviction and sentence he appeals. We find no merit in any of his contentions.
2
The appellant would excuse the failure to pay the wholesaler's tax by showing that his purchases were of tax-paid liquor from those authorized to sell and his sales were to those entitled to purchase. If sales of liquors are made in wholesale quantities without the payment of the required tax the law requiring such payment is violated no matter how many other laws may be observed. The acquittal of all of the other defendants charged with the appellant does not establish his innocence particularly since others who were not defendants were alleged to be conspirators. The payment in July, 1955, by the appellant of the tax for the preceding year and the succeeding year did not provide immunity from the penalties resulting from conduct prior to the time of payment. Neither in these nor in the other matters urged by the appellant do we find merit. The District Court's judgment is
3
Affirmed.
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436 U.S. 371 (1978)
BALDWIN ET AL.
v.
FISH AND GAME COMMISSION OF MONTANA ET AL.
No. 76-1150.
Supreme Court of the United States.
Argued October 5, 1977.
Decided May 23, 1978.
APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MONTANA
*372 James H. Goetz argued the cause and filed briefs for appellants.
Paul A. Lenzini argued the cause and filed a brief for appellees.
MR. JUSTICE BLACKMUN delivered the opinion of the Court.
This case presents issues, under the Privileges and Immunities Clause of the Constitution's Art. IV, § 2, and the Equal Protection Clause of the Fourteenth Amendment, as to the constitutional validity of disparities, as between residents and nonresidents, in a State's hunting license system.
I
Appellant Lester Baldwin is a Montana resident. He also is an outfitter holding a state license as a hunting guide. The majority of his customers are nonresidents who come to Montana to hunt elk and other big game. Appellants Carlson, Huseby, Lee, and Moris are residents of Minnesota.[1] They have hunted big game, particularly elk, in Montana in past years and wish to continue to do so.
In 1975, the five appellants, disturbed by the difference in the kinds of Montana elk-hunting licenses available to nonresidents, as contrasted with those available to residents of the State, and by the difference in the fees the nonresident and the resident must pay for their respective licenses, instituted the present federal suit for declaratory and injunctive relief and for reimbursement, in part, of fees already paid. App. 18-29. The defendants were the Fish and Game Commission of the State of Montana, the Commission's director, and its five commissioners. *373 The complaint challenged the Montana elk-hunting licensing scheme specifically, and asserted that, as applied to nonresidents, it violated the Constitution's Privileges and Immunities Clause, Art. IV, § 2, and the Equal Protection Clause of the Fourteenth Amendment. A three-judge District Court was convened and, by a divided vote, entered judgment denying all relief to the plaintiff-appellants. Montana Outfitters Action Group v. Fish & Game Comm'n, 417 F. Supp. 1005 (Mont. 1976). We noted probable jurisdiction. 429 U. S. 1089 (1977).[2]
II
The relevant facts are not in any real controversy and many of them are agreed:
A. For the 1975 hunting season, a Montana resident could purchase a license solely for elk for $4. The nonresident, however, in order to hunt elk, was required to purchase a combination license at a cost of $151; this entitled him to take one elk and two deer.[3]
For the 1976 season, the Montana resident could purchase a license solely for elk for $9. The nonresident, in order to hunt elk, was required to purchase a combination license at a cost of $225;[4] this entitled him to take one elk, one deer, one black bear, and game birds, and to fish with hook and line.[5] A *374 resident was not required to buy any combination of licenses, but if he did, the cost to him of all the privileges granted by the nonresident combination license was $30.[6] The nonresident thus paid 7½ times as much as the resident, and if the nonresident wished to hunt only elk, he paid 25 times as much as the resident.[7]
B. Montana, with an area of more than 147,000 square miles, is our fourth largest State. Only Alaska, Texas, and California, in that order, are larger. But its population is relatively small; in 1972 it was approximately 716,000.[8] Its 1974 per capita income was 34th among the 50 States. App. 56-57.
Montana maintains significant populations of big game, including elk, deer, and antelope. Tr. 191. Its elk population is one of the largest in the United States. Elk are prized by big-game hunters who come from near and far to pursue the animals for sport.[9] The quest for big game has grown in *375 popularity. During the 10-year period from 1960 to 1970 licenses issued by Montana increased by approximately 67% for residents and by approximately 530% for nonresidents.[10] App. 56-57.
Owing to its successful management programs for elk, the State has not been compelled to limit the overall number of hunters by means of drawings or lotteries as have other States with harvestable elk populations. Tr. 243. Elk are not hunted commercially in Montana.[11] Nonresident hunters seek the animal for its trophy value; the trophy is the distinctive set of antlers. The interest of resident hunters more often may be in the meat. Id., at 245. Elk are now found in the mountainous regions of western Montana and are generally *376 not encountered in the eastern two-thirds of the State where the plains prevail. Id., at 9-10, 249. During the summer the animals move to higher elevations and lands that are largely federally owned. In the late fall they move down to lower privately owned lands that provide the winter habitat necessary to their survival. During the critical midwinter period elk are often supported by ranchers. Id., at 46-47, 191, 285-286.[12]
Elk management is expensive. In regions of the State with significant elk population, more personnel time of the Fish and Game Commission is spent on elk than on any other species of big game. Defendant's Exhibit A, p. 9.
Montana has more than 400 outfitters who equip and guide hunting parties. Tr. 295. These outfitters are regulated and licensed by the State and provide services to hunters and fishermen. It is estimated that as many as half the nonresidents who hunt elk in western Montana utilize outfitters. Id., at 248. Three outfitter-witnesses testified that virtually all their clients were nonresidents. Id., at 141, 281, 307.
The State has a force of 70 game wardens. Each warden district covers approximately 2,100 square miles. Id., at 234. To assist wardens in law enforcement, Montana has an "equal responsibility" statute. Mont. Rev. Codes Ann. § 26-906 (Supp. 1977). This law makes outfitters and guides equally responsible for unreported game-law violations committed by persons in their hunting parties. The outfitter thus, in a sense, is a surrogate warden and serves to bolster the State's warden force.
III
In the District Court the majority observed that the elk once was a plains animal but now roams the mountains of *377 central and western Montana. About 75% of the elk taken are killed on federal land. The animal's preservation depends upon conservation. 417 F. Supp., at 1007. The majority noted that the appellants conceded that Montana constitutionally may charge nonresidents more for hunting privileges than residents. Id., at 1007-1008.[13] It concluded, however, that on the evidence presented the 7½-to-1 ratio in favor of the resident cannot be justified on any basis of cost allocation. Id., at 1008.
After satisfying itself as to standing[14] and as to the existence of a justiciable controversy, and after passing comment upon the somewhat controversial subject of wild animal legal ownership, the court concluded that the State "has the power to manage and conserve the elk, and to that end to make such laws and regulations as are necessary to protect and preserve it." Id., at 1009. In reaching this result, the majority examined the nature of the rights asserted by the plaintiffs. It observed that there were just too many people and too few elk to enable everyone to hunt the animals. "If the elk is to survive as a species, the game herds must be managed, and a vital part of the management is the limitation of the annual kill." Ibid. Various means of limitation were mentioned, as was the fact that any one control device might deprive a particular hunter of any possibility of hunting elk. The right asserted by the appellants was "no more than a chance to engage temporarily in a recreational activity in a sister state" and was "not fundamental." Ibid. Thus, it was not protected as a privilege and an immunity under the Constitution's Art. IV, § 2. The majority contrasted the nature *378 of the asserted right with educational needs at the primary and college levels, citing San Antonio School Dist. v. Rodriguez, 411 U. S. 1 (1973), and Sturgis v. Washington, 368 F. Supp. 38 (WD Wash.), summarily aff'd, 414 U. S. 1057 (1973), and said: "There is simply no nexus between the right to hunt for sport and the right to speak, the right to vote, the right to travel, the right to pursue a calling." 417 F. Supp., at 1009. It followed that it was necessary only to determine whether the system bears some rational relationship to legitimate state purposes. Then:
"We conclude that where the opportunity to enjoy a recreational activity is created or supported by a state, where there is no nexus between the activity and any fundamental right, and where by its very nature the activity can be enjoyed by only a portion of those who would enjoy it, a state may prefer its residents over the residents of other states, or condition the enjoyment of the nonresident upon such terms as it sees fit." Id., at 1010.
The dissenting judge took issue with the "ownership theory," and with any "special public interest" theory, and emphasized the absence of any cost-allocation basis for the license fee differential. He described the majority's posture as one upholding discrimination because political support was thereby generated, and took the position that invidious discrimination was not to be justified by popular disapproval of equal treatment. Id., at 1012.
IV
Privileges and immunities. Appellants strongly urge here that the Montana licensing scheme for the hunting of elk violates the Privileges and Immunities Clause[15] of Art. IV, § 2, *379 of our Constitution. That Clause is not one the contours of which have been precisely shaped by the process and wear of constant litigation and judicial interpretation over the years since 1789. If there is any significance in the fact, the Clause appears in the so-called States' Relations Article, the same Article that embraces the Full Faith and Credit Clause, the Extradition Clause (also in § 2), the provisions for the admission of new States, the Territory and Property Clause, and the Guarantee Clause. Historically, it has been overshadowed by the appearance in 1868 of similar language in § 1 of the Fourteenth Amendment,[16] and by the continuing controversy and consequent litigation that attended that Amendment's enactment and its meaning and application.
The Privileges and Immunities Clause originally was not isolated from the Commerce Clause, now in the Constitution's Art. I, § 8. In the Articles of Confederation, where both Clauses have their source, the two concepts were together in the fourth Article.[17] See Austin v. New Hampshire, 420 U. S. 656, 660-661 (1975); Lemmon v. People, 20 N. Y. 562, 627 (1860) (opinion of Wright, J.). Their separation may have been an assurance against an anticipated narrow reading of *380 the Commerce Clause. See Ward v. Maryland, 12 Wall. 418, 430-432 (1871).
Perhaps because of the imposition of the Fourteenth Amendment upon our constitutional consciousness and the extraordinary emphasis that the Amendment received, it is not surprising that the contours of Art. IV, § 2, cl. 1, are not well developed,[18] and that the relationship, if any, between the Privileges and Immunities Clause and the "privileges or immunities" language of the Fourteenth Amendment is less than clear. We are, nevertheless, not without some pronouncements by this Court as to the Clause's significance and reach. There are at least three general comments that deserve mention:
The first is that of Mr. Justice Field, writing for a unanimous Court in Paul v. Virginia, 8 Wall. 168, 180 (1869). He emphasized nationalism, the proscription of discrimination, and the assurance of equality of all citizens within any State:
"It was undoubtedly the object of the clause in question to place the citizens of each State upon the same footing with citizens of other States, so far as the advantages resulting from citizenship in those States are concerned. It relieves them from the disabilities of alienage in other States; it inhibits discriminating legislation against them by other States; it gives them the right of free ingress into other States, and egress from them; it insures to them in other States the same freedom possessed by the citizens of those States in the acquisition and enjoyment of property and in the pursuit of happiness; and it secures to them in other States the equal protection of their laws. It has been justly said that no provision in the Constitution has tended so strongly to *381 constitute the citizens of the United States one people as this."[19]
The second came 70 years later when Mr. Justice Roberts, writing for himself and Mr. Justice Black in Hague v. CIO, 307 U. S. 496, 511 (1939), summed up the history of the Clause and pointed out what he felt to be the diference in analysis in the earlier cases from the analysis in later ones:
"As has been said, prior to the adoption of the Fourteenth Amendment, there had been no constitutional definition of citizenship of the United States, or of the rights, privileges, and immunities secured thereby or springing therefrom. . . .
"At one time it was thought that this section recognized a group of rights which, according to the jurisprudence of the day, were classed as `natural rights'; and that the purpose of the section was to create rights of citizens of the United States by guaranteeing the citizens of every State the recognition of this group of rights by every other State. Such was the view of Justice Washington.
*382 "While this description of the civil rights of the citizens of the States has been quoted with approval, it has come to be the settled view that Article IV, § 2, does not import that a citizen of one State carries with him into another fundamental privileges and immunities which come to him necessarily by the mere fact of his citizenship in the State first mentioned, but, on the contrary, that in any State every citizen of any other State is to have the same privileges and immunities which the citizens of that State enjoy. The section, in effect, prevents a State from discriminating against citizens of other States in favor of its own." (Footnotes omitted.)
The third and most recent general pronouncement is that authored by MR. JUSTICE MARSHALL for a nearly unanimous Court in Austin v. New Hampshire, 420 U. S. 656, 660-661 (1975), stressing the Clause's "norm of comity" and the Framers' concerns:
"The Clause thus establishes a norm of comity without specifying the particular subjects as to which citizens of one State coming within the jurisdiction of another are guaranteed equality of treatment. The origins of the Clause do reveal, however, the concerns of central import to the Framers. During the preconstitutional period, the practice of some States denying to outlanders the treatment that its citizens demanded for themselves was widespread. The fourth of the Articles of Confederation was intended to arrest this centrifugal tendency with some particularity. . . .
.....
"The discriminations at which this Clause was aimed were by no means eradicated during the short life of the Confederation, and the provision was carried over into the comity article of the Constitution in briefer form but with no change of substance or intent, unless it was *383 to strengthen the force of the Clause in fashioning a single nation." (Footnotes omitted.)
When the Privileges and Immunities Clause has been applied to specific cases, it has been interpreted to prevent a State from imposing unreasonable burdens on citizens of other States in their pursuit of common callings within the State, Ward v. Maryland, 12 Wall. 418 (1871); in the ownership and disposition of privately held property within the State, Blake v. McClung, 172 U. S. 239 (1898); and in access to the courts of the State, Canadian Northern R. Co. v. Eggen, 252 U. S. 553 (1920).
It has not been suggested, however, that state citizenship or residency may never be used by a State to distinguish among persons. Suffrage, for example, always has been understood to be tied to an individual's identification with a particular State. See, e. g., Dunn v. Blumstein, 405 U. S. 330 (1972). No one would suggest that the Privileges and Immunities Clause requires a State to open its polls to a person who declines to assert that the State is the only one where he claims a right to vote. The same is true as to qualification for an elective office of the State. Kanapaux v. Ellisor, 419 U. S. 891 (1974); Chimento v. Stark, 353 F. Supp. 1211 (NH), summarily aff'd, 414 U. S. 802 (1973). Nor must a State always apply all its laws or all its services equally to anyone, resident or nonresident, who may request it so to do. Canadian Northern R. Co. v. Eggen, supra; cf. Sosna v. Iowa, 419 U. S. 393 (1975); Shapiro v. Thompson, 394 U. S. 618 (1969). Some distinctions between residents and nonresidents merely reflect the fact that this is a Nation composed of individual States, and are permitted; other distinctions are prohibited because they hinder the formation, the purpose, or the development of a single Union of those States. Only with respect to those "privileges" and "immunities" bearing upon the vitality of the Nation as a single entity must the State treat all citizens, resident and nonresident, equally. Here we must *384 decide into which category falls a distinction with respect to access to recreational big-game hunting.
Many of the early cases embrace the concept that the States had complete ownership over wildlife within their boundaries, and, as well, the power to preserve this bounty for their citizens alone. It was enough to say "that in regulating the use of the common property of the citizens of [a] state, the legislature is [not] bound to extend to the citizens of all the other states the same advantages as are secured to their own citizens." Corfield v. Coryell, 6 F. Cas. 546, 552 (No. 3,230) (CC ED Pa. 1825). It appears to have been generally accepted that although the States were obligated to treat all those within their territory equally in most respects, they were not obliged to share those things they held in trust for their own people. In Corfield, a case the Court has described as "the first, and long the leading, explication of the [Privileges and Immunities] Clause," see Austin v. New Hampshire, 420 U. S., at 661, Mr. Justice Washington, sitting as Circuit Justice, although recognizing that the States may not interfere with the "right of a citizen of one state to pass through, or to reside in any other state, for purposes of trade, agriculture, professional pursuits, or otherwise; to claim the benefit of the writ of habeas corpus; to institute and maintain actions of any kind in the courts of the state; to take, hold and dispose of property, either real or personal,"[20] 6 F. Cas., at 552, none-theless *385 concluded that access to oyster beds determined to be owned by New Jersey could be limited to New Jersey residents. This holding, and the conception of state sovereignty upon which it relied, formed the basis for similar decisions during later years of the 19th century. E. g., McCready v. Virginia, 94 U. S. 391 (1877); Geer v. Connecticut, 161 U. S. 519 (1896).[21] See Rosenfeld v. Jakways, 67 Mont. 558, 216 P. 776 (1923). In Geer, a case dealing with Connecticut's authority to limit the disposition of game birds taken within its boundaries, the Court roundly rejected the contention "that a State cannot allow its own people the enjoyment of the benefits of the property belonging to them in common, without at the same time permitting the citizens of other States to participate in that which they do not own." 161 U. S., at 530.
In more recent years, however, the Court has recognized that the States' interest in regulating and controlling those things they claim to "own," including wildlife, is by no means absolute. States may not compel the confinement of the benefits of their resources, even their wildlife, to their own people whenever such hoarding and confinement impedes *386 interstate commerce. Foster-Fountain Packing Co. v. Haydel, 278 U. S. 1 (1928); Pennsylvania v. West Virginia, 262 U. S. 553 (1923); West v. Kansas Natural Gas Co., 221 U. S. 229 (1911). Nor does a State's control over its resources preclude the proper exercise of federal power. Douglas v. Seacoast Products, Inc., 431 U. S. 265 (1977); Kleppe v. New Mexico, 426 U. S. 529 (1976); Missouri v. Holland, 252 U. S. 416 (1920). And a State's interest in its wildlife and other resources must yield when, without reason, it interferes with a nonresident's right to pursue a livelihood in a State other than his own, a right that is protected by the Privileges and Immunities Clause. Toomer v. Witsell, 334 U. S. 385 (1948). See Takahashi v. Fish & Game Comm'n, 334 U. S. 410 (1948).
Appellants contend that the doctrine on which Corfield, McCready, and Geer all relied has no remaining vitality. We do not agree. Only last Term, in referring to the "ownership" or title language of those cases and characterizing it "as no more than a 19th-century legal fiction," the Court pointed out that that language nevertheless expressed "`the importance to its people that a State have power to preserve and regulate the exploitation of an important resource.'" Douglas v. Seacoast Products, Inc., 431 U. S., at 284, citing Toomer v. Witsell, 334 U. S., at 402. The fact that the State's control over wildlife is not exclusive and absolute in the face of federal regulation and certain federally protected interests does not compel the conclusion that it is meaningless in their absence.
We need look no further than decisions of this Court to know that this is so. It is true that in Toomer v. Witsell the Court in 1948 struck down a South Carolina statute requiring nonresidents of the State to pay a license fee of $2,500 for each commercial shrimp boat, and residents to pay a fee of only $25, and did so on the ground that the statute violated the Privileges and Immunities Clause. Id., at 395-403. See also Mullaney v. Anderson, 342 U. S. 415 (1952), another commercial-livelihood case. Less than three years, however, after the decision in Toomer, so heavily relied upon by appellants *387 here, the Court dismissed for the want of a substantial federal question an appeal from a decision of the Supreme Court of South Dakota holding that the total exclusion from that State of nonresident hunters of migratory waterfowl was justified by the State's assertion of a special interest in wildlife that qualified as a substantial reason for the discrimination. State v. Kemp, 73 S. D. 458, 44 N. W. 2d 214 (1950), appeal dismissed, 340 U. S. 923 (1951). In that case South Dakota had proved that there was real danger that the fly-ways, breeding grounds, and nursery for ducks and geese would be subject to excessive hunting and possible destruction by nonresident hunters lured to the State by an abundance of pheasants. 73 S. D., at 464, 44 N. W. 2d, at 217.
Appellants have demonstrated nothing to convince us that we should completely reject the Court's earlier decisions. In his opinion in Coryell, Mr. Justice Washington, although he seemingly relied on notions of "natural rights" when he considered the reach of the Privileges and Immunities Clause, included in his list of situations, in which he believed the States would be obligated to treat each other's residents equally, only those where a nonresident sought to engage in an essential activity or exercise a basic right. He himself used the term "fundamental," 6 F. Cas., at 551, in the modern as well as the "natural right" sense. Certainly Mr. Justice Field and the Court invoked the same principle in the language quoted above from Paul v. Virginia, 8 Wall., at 180. So, too, did the Court by its holdings in Ward v. Maryland, Canadian Northern R. Co. v. Eggen, and Blake v. McClung, all supra, when it was concerned with the pursuit of common callings, the ability to transfer property, and access to courts, respectively. And comparable status of the activity involved was apparent in Toomer, the commercial-licensing case. With respect to such basic and essential activities, interference with which would frustrate the purposes of the formation of the Union, the States must treat residents and nonresidents without unnecessary distinctions.
*388 Does the distinction made by Montana between residents and nonresidents in establishing access to elk hunting threaten a basic right in a way that offends the Privileges and Immunities Clause? Merely to ask the question seems to provide the answer. We repeat much of what already has been said above: Elk hunting by nonresidents in Montana is a recreation and a sport. In itselfwholly apart from license feesit is costly and obviously available only to the wealthy nonresident or to the one so taken with the sport that he sacrifices other values in order to indulge in it and to enjoy what it offers. It is not a means to the nonresident's livelihood. The mastery of the animal and the trophy are the ends that are sought; appellants are not totally excluded from these. The elk supply, which has been entrusted to the care of the State by the people of Montana, is finite and must be carefully tended in order to be preserved.
Appellants' interest in sharing this limited resource on more equal terms with Montana residents simply does not fall within the purview of the Privileges and Immunities Clause. Equality in access to Montana elk is not basic to the maintenance or well-being of the Union. Appellants do notand cannotcontend that they are deprived of a means of a livelihood by the system or of access to any part of the State to which they may seek to travel. We do not decide the full range of activities that are sufficiently basic to the livelihood of the Nation that the States may not interfere with a nonresident's participation therein without similarly interfering with a resident's participation. Whatever rights or activities may be "fundamental" under the Privileges and Immunities Clause, we are persuaded, and hold, that elk hunting by nonresidents in Montana is not one of them.
V
Equal protection. Appellants urge, too, that distinctions drawn between residents and nonresidents are not permissible under the Equal Protection Clause of the Fourteenth Amendment *389 when used to allocate access to recreational hunting. Appellees argue that the Stato constitutionally should be able to charge nonresidents, who are not subject to the State's general taxing power, more than it charges its residents, who are subject to that power and who already have contributed to the programs that make elk hunting possible. Appellees also urge that Montana, as a State, has made sacrifices in its economic development, and therefore in its tax base, in order to preserve the elk and other wildlife within the State and that this, too, must be counted, along with actual tax revenues spent, when computing the fair share to be paid by nonresidents. We need not commit ourselves to any particular method of computing the cost to the State of maintaining an environment in which elk can survive in order to find the State's efforts rational, and not invidious, and therefore not violative of the Equal Protection Clause.
A repetitious review of the factual setting is revealing: The resident obviously assists in the production and maintenance of big-game populations through taxes. The same taxes provide support for state parks utilized by sportsmen, Plaintiffs' Exhibit 1; for roads providing access to the hunting areas, Tr. 156-158, 335; for fire suppression to protect the wildlife habitat, id., at 167; for benefits to the habitat effected by the State's Environmental Quality Council, id., at 163-165; for the enforcement of state air and water quality standards, id., at 223-224; for assistance by sheriffs' departments to enforce game laws. Defendants' Exhibit G, p. 13; and for state highway patrol officers who assist wildlife officers at game checking stations and in enforcement of game laws. Forage support by resident ranchers is critical for winter survival. Tr. 46-47, 286. All this is on a continuing basis.
On the other side of the same ledger is the great, and almost alarming, increase in the number of nonresident huntersin the decade of the 1960's, almost eight times the increase in resident hunters; the group character of much nonresident *390 hunting, with its opportunity for license "swapping" when the combination license system is not employed, id., at 237;[22] the intermingling of deer and elk in the wild and the inexperienced hunter's inability to tell one from the other; the obvious limit in the elk supply; the supposition that the nonresident occasional and short-term visitor is more likely to commit game-law violations; the need to supervise hunting practices in order to prevent violations and illegal overkill; and the difficulties of supervision in the primitive areas where the elk is found during the hunting season.
All this adds up, in our view, to no irrationality in the differences the Montana Legislature has drawn in the costs of its licenses to hunt elk. The legislative choice was an economic means not unreasonably related to the preservation of a finite resource and a substantial regulatory interest of the State. It serves to limit the number of hunter days in the Montana elk country. There is, to be sure, a contrasting cost feature favorable to the resident, and, perhaps, the details and the figures might have been more precisely fixed and more closely related to basic costs to the State. But, as has been noted, appellants concede that a differential in cost between residents and nonresidents is not in itself invidious or unconstitutional. And "a statutory classification impinging upon no fundamental interest . . . need not be drawn so as to fit with precision the legitimate purposes animating it . . . That [Montana] might have furthered its underlying purpose more artfully, more directly, or more completely, does not warrant a conclusion that the method it chose is unconstitutional." Hughes v. Alexandria Scrap Corp., 426 U. S. 794, 813 (1976).[23]
*391 Appellants also contend that the requirement that non-resident, but not resident, hunters must purchase combination licenses in order to be able to obtain a single elk is arbitrary. In the District Court the State introduced evidence, largely uncontradicted, that nonresident hunters create greater enforcement problems and that some of these problems are alleviated by this requirement. The District Court's majority appears to have found this evidence credible and the justification rational, and we are in no position to disagree. Many of the same factors just listed in connection with the license fee differential have equal pertinency for the combination license requirement. We perceive no duty on the State to have its licensing structure parallel or identical for both residents and nonresidents, or to justify to the penny any cost differential it imposes in a purely recreational, noncommercial, nonlivelihood setting. Rationality is sufficient. That standard, we feel, has been met by Montana. So long as constitutional requirements have been met, as we conclude is the case here, "[p]rotection of the wild life of the State is peculiarly within the police power, and the State has great latitude in determining what means are appropriate for its protection." Lacoste v. Department of Conservation, 263 U. S. 545, 552 (1924).[24]
*392 The judgment of the District Court is affirmed.
It is so ordered.
MR. CHIEF JUSTICE BURGER, concurring.
In joining the Court's opinion I write separately only to emphasize the significance of Montana's special interest in its elk population and to point out the limits of the Court's holding.
The doctrine that a State "owns" the wildlife within its borders as trustee for its citizens, see Geer v. Connecticut, 161 U. S. 519 (1896), is admittedly a legal anachronism of sorts. See Douglas v. Seacoast Products, Inc., 431 U. S. 265, 284 (1977). A State does not "own" wild birds and animals in the same way that it may own other natural resources such as land, oil, or timber. But, as noted in the Court's opinion, ante, at 386, and contrary to the implications of the dissent, the doctrine is not completely obsolete. It manifests the State's special interest in regulating and preserving wildlife for the benefit of its citizens. See Douglas v. Seacoast Products, Inc., supra, at 284, 287. Whether we describe this interest as proprietary or otherwise is not significant.
We recognized in Toomer v. Witsell, 334 U. S. 385, 401-402 (1948), that the doctrine does not apply to migratory shrimp located in the three-mile belt of the marginal sea. But the elk involved in this case are found within Montana and remain primarily within the State. As such they are natural resources of the State, and Montana citizens have a legitimate interest in preserving their access to them. The Court acknowledges this interest when it points out that the Montana elk supply "has been entrusted to the care of the State by the people of Montana," ante, at 388, and asserts the continued vitality of *393 the doctrine upon which the court relied in Corfield v. Coryell, 6 F. Cas. 546, 552 (No. 3,230) (CC ED Pa. 1825); McCready v. Virginia, 94 U. S. 391 (1877); and Geer v. Connecticut, supra. See ante, at 386.
McCready v. Virginia, supra, made it clear that the Privileges and Immunities Clause does not prevent a State from preferring its own citizens in granting public access to natural resources in which they have a special interest. Thus Montana does not offend the Privileges and Immunities Clause by granting residents preferred access to natural resources that do not belong to private owners. And Montana may give its residents preferred access to Montana elk without offending the Privileges and Immunities Clause.
It is not necessary to challenge the cases cited by the dissent, post, at 405, which make clear that a State does not have absolute freedom to regulate the taking of wildlife within its borders or over its airspace. A State may not regulate the killing of migratory game birds in a way that frustrates a valid treaty of the United States entered into pursuant to the Art. II, § 2, treaty power, Missouri v. Holland, 252 U. S. 416, 434 (1920); it may not regulate wild animals found on federal lands in a way that conflicts with federal statutes enacted under the Property Clause, Art. IV, § 3, cl. 2, Kleppe v. New Mexico, 426 U. S. 529, 546 (1976); nor may it allocate access to its wildlife in a manner that offends the Fourteenth Amendment. Takahashi v. Fish & Game Comm'n, 334 U. S. 410 (1948). Once wildlife becomes involved in interstate commerce, a State may not restrict the use of or access to that wildlife in a way that burdens interstate commerce. Douglas v. Seacoast Products, Inc., supra, at 281-282; Foster-Fountain Packing Co. v. Haydel, 278 U. S. 1 (1928). None of those cases hold that the Privileges and Immunities Clause prevents a State from preferring its own citizens in allocating access to wildlife within that State.
It is the special interest of Montana citizens in its elk that *394 permits Montana to charge nonresident hunters higher license fees without offending the Privileges and Immunities Clause. The Court does not hold that the Clause permits a State to give its residents preferred access to recreational activities offered for sale by private parties. Indeed it acknowledges that the Clause requires equality with respect to privileges "bearing upon the vitality of the Nation as a single entity." Ante, at 383. It seems clear that those basic privileges include "all the privileges of trade and commerce" which were protected in the fourth Article of the Articles of Confederation. See Austin v. New Hampshire, 420 U. S. 656, 660-661, and n. 6 (1975). The Clause assures noncitizens the opportunity to purchase goods and services on the same basis as citizens; it confers the same protection upon the buyer of luxury goods and services as upon the buyer of bread.
MR. JUSTICE BRENNAN, with whom MR. JUSTICE WHITE and MR. JUSTICE MARSHALL join, dissenting.
Far more troublesome than the Court's narrow holdingelk hunting in Montana is not a privilege or immunity entitled to protection under Art. IV, § 2, cl. 1, of the Constitutionis the rationale of the holding that Montana's elk-hunting licensing scheme passes constitutional muster. The Court concludes that because elk hunting is not a "basic and essential activit[y], interference with which would frustrate the purposes of the formation of the Union," ante, at 387, the Privileges and Immunities Clause of Art. IV, § 2"The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States"does not prevent Montana from irrationally, wantonly, and even invidiously discriminating against nonresidents seeking to enjoy natural treasures it alone among the 50 States possesses. I cannot agree that the Privileges and Immunities Clause is so impotent a guarantee that such discrimination remains wholly beyond the purview of that provision.
*395 I
It is true that because the Clause has not often been the subject of litigation before this Court, the precise scope of the protection it affords the citizens of each State in their sister States remains to be defined. Much of the uncertainty is, no doubt, a product of Mr. Justice Washington's exposition of its scope in Corfield v. Coryell, 6 F. Cas. 546, 551 (No. 3,230) (CC ED Pa. 1825), where he observed:
"[W]hat are the privileges and immunities of citizens in the several states? We feel no hesitation in confining these expressions to those privileges and immunities which are, in their nature, fundamental; which belong, of right, to the citizens of all free governments; and which have, at all times, been enjoyed by the citizens of the several states which compose this Union, from the time of their becoming free, independent, and sovereign." (Emphasis added.)
Among these "fundamental" rights he included "[p]rotection by the government; . . . [t]he right of a citizen of one state to pass through, or to reside in any other state, for purposes of trade, agriculture, professional pursuits, or otherwise; to claim the benefit of the writ of habeas corpus; to institute and maintain actions of any kind in the courts of the state; to take, hold and dispose of property, either real or personal; and an exemption from higher taxes or impositions than are paid by the other citizens of the state." Id., at 551-552. These rights, only the last of which was framed in terms of discriminatory treatment, were to be enjoyed "by the citizens of each state, in every other state . . . ." Id., at 552. As both the italicized language and the list of rights designed as falling within the compass of Art. IV, § 2, cl. 1, make clear, Mr. Justice Washington believed that the Clause was designed to guarantee certain "fundamental" rights to all United States citizens, regardless of the rights afforded by a State to its own *396 citizens. In Hague v. CIO, 307 U. S. 496, 511 (1939), Mr. Justice Roberts so characterized Mr. Justice Washington's view: "At one time it was thought that [Art. IV, § 2, cl. 1] recognized a group of rights which, according to the jurisprudence of the day, were classed as `natural rights'; and that the purpose of the section was to create rights of citizens of the United States by guaranteeing the citizens of every State the recognition of this group of rights by every other State. Such was the view of Justice Washington."
That Mr. Justice Washington thought Art. IV, § 2, cl. 1, to embody a guarantee of "natural rights" is not surprising. It revealed his preference for that determination of the controversy raging in his time over the significance of "natural rights" in constitutional adjudication.
"Behind the 1825 Corfield opinion lay the nineteenth century controversy over the status of `natural rights' in constitutional litigation. Some judges had supposed an inherent limitation on state and federal legislation that compelled courts to strike down any law `contrary to the first great principles of the social compact.' They were the proponents of the natural rights doctrine which, without specific constitutional moorings, posited `certain vital principles in our free republican governments, which will determine and overrule an apparent abuse of legislative powers.'
"Corfield can be understood as an attempt to import the natural rights doctrine into the Constitution by way of the privileges and immunities clause of article IV. By attaching the fundamental rights of state citizenship to the privileges and immunities clause, Justice Washington would have created federal judicial protection against state encroachment upon the `natural rights' of citizens." L. Tribe, American Constitutional Law 405-406 (1978) (footnotes omitted).
What is surprising, however, is the extent to which Corfield's *397 view of the Clause as protecting against governmental encroachment upon "natural rights" continued to influence interpretation of the Clause[1] even after Mr. Justice Washington's view was seemingly discarded in Paul v. Virginia, 8 Wall. 168 (1869), and replaced by the view that the measure of the rights secured to nonresidents[2] was the extent of the rights afforded by a State to its own citizens. Paul announced that "[i]t was undoubtedly the object of the clause . . . to place the citizens of each State upon the same footing with citizens of other States, so far as the advantages resulting from citizenship in those States are concerned." Id., at 180 (emphasis added). But during the 79 years between Paul and our decision in Toomer v. Witsell, 334 U. S. 385 (1948), Art. IV, § 2, cl. 1, was given an anomalous and unduly restrictive scope. Mr. Justice Washington's expansive interpretation of "privileges and immunities" as broadly insuring a host of rights against all government interference was superimposed on Paul's conception of the Clause as prohibiting a State from unjustiflably discriminating against nonresidentsa view of Art. IV, § 2, cl. 1, that I think correctwith the result that the Clause's guarantee was held to prohibit a State from denying to citizens of other States only those "fundamental" rights that it guaranteed to its own citizens. Cf. Minor v. Happersett, 21 Wall. 162, 174 (1875). Yet because nonresidents could present special problems for a State in the administration of its laws even where rights thought to be "fundamental" were involved, this conception of Art. IV, § 2, cl. 1, born of the commingling of two disparate views of the Clause that *398 were never meant to mate, proved difficult of rigid application. Thus, although Mr. Justice Washington listed the right "to institute and maintain actions of any kind in the courts of the state" as one of the "fundamental" rights within the ambit of Art. IV, § 2, cl. 1, Corfield v. Coryell, supra, at 552, this Court upheld state statutes that denied nonresidents precisely the same access to state courts as was guaranteed residents. Chemung Canal Bank v. Lowery, 93 U. S. 72 (1876), for example, upheld a Wisconsin statute that tolled the statute of limitations on a cause of action against a defendant absent from the State only when the plaintiff was a Wisconsin resident; the ground was that "[t]here is, in fact, a valid reason for the discrimination." Id., at 77.[3] Similarly, Canadian Northern R. Co. v. Eggen, 252 U. S. 553 (1920), sanctioned a Minnesota provision that allowed only citizens of that State to sue in state court on a cause of action arising out of the State that would have been barred by the statute of limitations in the State where the cause of action arose. The Court found that such a statute did not, in the words of Blake v. McClung, 172 U. S. 239, 256 (1898), "`materially interfer[e] with the enjoyment by citizens of each State of the privileges and immunities secured by the Constitution to citizens of the several States.'" Canadian Northern R. Co. v. Eggen, supra, at 562.
Mr. Justice Roberts' analysis of the Privileges and Immunities Clause of Art. IV, § 2, in Hague v. CIO, supra, was the first noteworthy modern pronouncement on the Clause from *399 this Court. Not only did Mr. Justice Roberts recognize that Corfield's view of the Privileges and Immunities Clause might, and should be, properly interred as the product of a bygone era, but also he went on to emphasize the interpretation of the scope of the Clause proposed in Paul v. Virginia, supra, namely, that "[t]he section, in effect, prevents a State from discriminating against citizens of other States in favor of its own." 307 U. S., at 511. In singling out this passage as one of "three general comments [on the Clause] that deserve mention," ante, at 380, the Court acknowledges the significance of Mr. Justice Roberts' statement, but, with all respect, errs in not also appreciating that the Roberts statement signaled the complete demise of the Court's acceptance of Corfield's definition of the type of rights encompassed by the phrase "privileges and immunities." No longer would that definition be controlling, or even relevant, in evaluating whether the discrimination visited by a State on nonresidents vis-à-vis its own citizens passed constitutional muster.
Less than a decade after Hague, Toomer v. Witsell, supra, embraced and applied the Roberts interpretation of the Clause. In Toomer, a South Carolina statute that required nonresidents to pay a fee 100 times greater than that paid by residents for a license to shrimp commercially in the three-mile maritime belt off the coast of that State was held to be violative of the Clause. After stating that the Clause "was designed to insure to a citizen of State A who ventures into State B the same privileges which the citizens of State B enjoy," 334 U. S., at 395, the Court set out the standard against which a State's differential treatment of nonresidents would be evaluated.
"Like many other constitutional provisions, the privileges and immunities clause is not an absolute. It does bar discrimination against citizens of other States where there is no substantial reason for the discrimination beyond the mere fact that they are citizens of other *400 States. But it does not preclude disparity of treatment in the many situations where there are perfectly valid independent reasons for it. Thus the inquiry in each case must be concerned with whether such reasons do exist and whether the degree of discrimination bears a close relation to them. The inquiry must also, of course, be conducted with due regard for the principle that the States should have considerable leeway in analyzing local evils and in prescribing appropriate cures." Id., at 396 (emphasis added) (footnote omitted).
Unlike the relatively minimal burden of rationality South Carolina would have had to satisfy in defending a law not infringing on a "fundamental" interest against an equal protection attack, see Hughes v. Alexandria Scrap Corp., 426 U. S. 794 (1976), the State could not meet the plaintiffs' privileges and immunities challenge simply by asserting that the discrimination was a rational means for fostering a legitimate state interest. Instead, even though an important state objectiveconservationwas at stake, Toomer held that a classification based on the fact of noncitizenship was constitutionally infirm "unless there is something to indicate that non-citizens constitute a peculiar source of the evil at which the statute is aimed." 334 U. S., at 398. Moreover, even where the problem the State is attempting to remedy is linked to the presence or activity of nonresidents in the State, the Clause requires that there be "a reasonable relationship between the danger represented by non-citizens, as a class, and the . . . discrimination practiced upon them." Id., at 399.
Toomer was followed in Mullaney v. Anderson, 342 U. S. 415 (1952). In Mullaney, the scheme employed by the Territorial Legislature of Alaska for the licensing of commercial fishermen in territorial waters, which imposed a $5 license fee on resident fishermen and a $50 fee on nonresidents, was found invalid under the Clause. Although the Court reaffirmed its observation in Toomer that a State may "charge non-residents a *401 differential which would merely compensate the State for any added enforcement burden they may impose or for any conservation expenditures from taxes which only residents pay," 342 U. S., at 417, the Court found that Alaska's mere assertion of these justifications was insufficient to sustain the fee differential in licensing in the face of evidence that, in the case under review, the justifications had no basis in fact.
Neither Toomer nor Mullaney cited Corfield or discussed whether commercial fishing was the type of "fundamental" right entitled to protection under Mr. Justice Washington's view of the Privileges and Immunities Clause. Although the Court in Toomer did "hold that commercial shrimping in the marginal sea, like other common callings, is within the privileges and immunities clause," 334 U. S., at 403, its statement to this effect was conclusory and clearly secondary to its extensive analysis of whether South Carolina's discrimination against nonresidents was properly justified. The State's justification for its discrimination against nonresidents was also the focus of the privileges and immunities analysis in Doe v. Bolton, 410 U. S. 179 (1973), which summarily added "medical services" to the panoply of privileges protected by the Clause and held invalid a Georgia law permitting only Georgia residents to obtain abortions within that State.[4] It is true that Austin v. New Hampshire, 420 U. S. 656 (1975), cited Corfield for the proposition that discriminatory taxation of the nonresident was one of the evils the Clause was designed to protect against; but "an exemption from higher taxes" was the one privileges and immunities right that Mr. Justice Washington framed in terms of discriminatory treatment. As in Toomer, Mullaney, and Bolton, the Court's *402 principal concern in Austin was the classification itselfthe fact that the discrimination hinged on the status of nonresidency.
I think the time has come to confirm explicitly that which has been implicit in our modern privileges and immunities decisions, namely that an inquiry into whether a given right is "fundamental" has no place in our analysis of whether a State's discrimination against nonresidentswho "are not represented in the [discriminating] State's legislative halls," Austin v. New Hampshire, supra, at 662violates the Clause. Rather, our primary concern is the State's justification for its discrimination. Drawing from the principles announced in Toomer and Mullaney, a State's discrimination against nonresidents is permissible where (1) the presence or activity of nonresidents is the source or cause of the problem or effect with which the State seeks to deal, and (2) the discrimination practiced against nonresidents bears a substantial relation to the problem they present. Although a State has no burden to prove that its laws are not violative of the Privileges and Immunities Clause, its mere assertion that the discrimination practiced against nonresidents is justified by the peculiar problem nonresidents present will not prevail in the face of a prima facie showing that the discrimination is not supportable on the asserted grounds. This requirement that a State's unequal treatment of nonresidents be reasoned and suitably tailored furthers the federal interest in ensuring that "a norm of comity," Austin v. New Hampshire, supra, at 660, prevails throughout the Nation while simultaneously guaranteeing to the States the needed leeway to draw viable distinctions between their citizens and those of other States.
II
It is clear that under a proper privileges and immunities analysis Montana's discriminatory treatment of nonresident big-game hunters in this case must fall. Putting aside the *403 validity of the requirement that nonresident hunters desiring to hunt elk must purchase a combination license that resident elk hunters need not buy, there are three possible justifications for charging nonresident elk hunters an amount at least 7.5 times the fee imposed on resident big-game hunters.[5] The first is conservation. The State did not attempt to assert this as a justification for its discriminatory licensing scheme in the District Court, and apparently does not do so here. Indeed, it is difficult to see how it could consistently with the first prong of a modern privileges and immunities analysis. First, there is nothing in the record to indicate that the influx of nonresident hunters created a special danger to Montana's elk or to any of its other wildlife species. In the most recent year for which statistics are available, 1974-1975, there were 198,411 resident hunters in Montana and only 31,406 nonresident hunters. Nonresidents thus constituted only 13% of all hunters pursuing their sport in the State.[6] Moreover, as the Court recognizes, ante, at 375 n. 10, the number of nonresident big-game hunters has never approached the 17,000 limit set by statute, presumably as a precautionary conservation measure.[7] Second, if Montana's discriminatorily high big-game license fee is an outgrowth of general conservation policy to discourage elk hunting, this too fails as a basis for the licensing scheme. *404 Montana makes no effort similarly to inhibit its own residents. As we said in Douglas v. Seacoast Products, Inc., 431 U. S. 265, 285 n. 21 (1977), "[a] statute that leaves a State's residents free to destroy a natural resource while excluding aliens or nonresidents is not a conservation law at all."
The second possible justification for the fee differential Montana imposes on nonresident elk huntersthe one presented in the District Court and principally relied upon here is a cost justification. Appellants have never contended that the Privileges and Immunities Clause requires that identical fees be assessed residents and nonresidents. They recognize that Toomer and Mullaney allow additional charges to be made on nonresidents based on both the added enforcement costs the presence of nonresident hunters imposes on Montana and the State's conservation expenditures supported by resident-borne taxes. Their position throughout this litigation has been that the higher fee extracted from nonresident elk hunters is not a valid effort by Montana to recoup state expenditures on their behalf, but a price gouged from those who can satisfactorily pursue their avocation in no other State in the Union. The licensing scheme, appellants contend, is simply an attempt by Montana to shift the costs of its conservation efforts, however commendable they may be, onto the shoulders of nonresidents who are powerless to help themselves at the ballot box. The District Court agreed, finding that "[o]n a consideration of [the] evidence . . . and with due regard to the presumption of constitutionality . . . the ratio of 7.5 to 1 cannot be justified on any basis of cost allocation." Montana Outfitters Action Group v. Fish & Game Comm'n, 417 F. Supp. 1005, 1008 (Mont. 1976). This finding is not clearly erroneous, United States v. United States Gypsum Co., 333 U. S. 364, 394-395 (1948), and the Court does not intimate otherwise. Montana's attempt to cost-justify its discriminatory licensing practices thus fails under the second prong of a correct privileges and immunities *405 analysisthat which requires the discrimination a State visits upon nonresidents to bear a substantial relation to the problem or burden they pose.
The third possible justification for Montana's licensing scheme, the doctrine of McCready v. Virginia, 94 U. S. 391 (1877), is actually no justification at all, but simply an assertion that a State "owns" the wildlife within its borders in trust for its citizens and may therefore do with it what it pleases. See Geer v. Connecticut, 161 U. S. 519 (1896). The lingering death of the McCready doctrine as applied to a State's wildlife, begun with the thrust of Mr. Justice Holmes' blade in Missouri v. Holland, 252 U. S. 416, 434 (1920) ("[t]o put the claim of the State upon title is to lean upon a slender reed") and aided by increasingly deep twists of the knife in Foster Fountain Packing Co. v. Haydel, 278 U. S. 1, 11-14 (1928); Toomer v. Witsell, 334 U. S., at 402; Takahashi v. Fish & Game Comm'n, 334 U. S. 410, 421 (1948); and Kleppe v. New Mexico, 426 U. S. 529, 545-546 (1976), finally became a reality in Douglas v. Seacoast Products, Inc., supra, at 284, where MR. JUSTICE MARSHALL, speaking for the Court, observed:
"A State does not stand in the same position as the owner of a private game preserve and it is pure fantasy to talk of `owning' wild fish, birds, or animals. Neither the States nor the Federal Government, any more than a hopeful fisherman or hunter, has title to these creatures until they are reduced to possession by skillful capture.... The `ownership' language of cases such as those cited by appellant must be understood as no more than a 19th century legal fiction expressing `the importance to its people that a State have power to preserve and regulate the exploitation of an important resource.' Toomer v. Witsell, 334 U. S., at 402 .... Under modern analysis, the question is simply whether the State has exercised its police power in conformity with the federal laws and Constitution."
*406 In unjustifiably discriminating against nonresident elk hunters, Montana has not "exercised its police power in conformity with the ... Constitution." The State's police power interest in its wildlife cannot override the appellants' constitutionally protected privileges and immunities right. I respectfully dissent and would reverse.[8]
NOTES
[1] Montana statutorily defines one's place of residence. Mont. Rev. Codes Ann. § 83-303 (1966 and Supp. 1977). It imposes a durational requirement of six months for eligibility to receive a resident's hunting or fishing license. § 26-202.3 (2) (Supp. 1975). Appellants, other than Baldwin, make no claim to Montana residence and do not challenge §§ 83-303 and 26-202.3 (2) in any way. Tr. of Oral Arg. 39-40.
[2] We note, in passing, that most States charge nonresidents more than residents for hunting licenses. E. g., Alaska Stat. Ann. § 16.05.340 (1977); Colo. Rev. Stat. § 33-4-102 (Supp. 1976); Me. Rev. Stat. Ann., Tit. 12, § 2401 (Supp. 1977); Wis. Stat. §§ 29.10, 29.105, 29.109, 29.12 (Supp. 1977); Wyo. Stat. § 23.1-33 (Supp. 1977). Others are listed in the Appendix to the Brief for Appellees.
[3] 1973 Mont. Laws, ch. 408, § 1, and 1969 Mont. Laws, ch. 172, § 2.
[4] Mont. Rev. Codes Ann. §§ 26-202.1 (4) and (12), and 26-230 (Supp. 1977). A nonresident, however, could obtain a license restricted to deer for $51. §§ 26-202.1 (9) and 26-230.
[5] We were advised at oral argument that Montana's method of use of a combination license is unique among the States. Tr. of Oral Arg. 8. See Reply Brief for Appellants 29.
[6] Mont. Rev. Codes Ann. §§ 26-202.1 (1), (2), and (4) and 26-230 (Supp. 1977).
[7] There are similar disparities between Montana resident and nonresident hunting licenses for all other game, except wild turkey and as to bowhunting. The present litigation, however, focuses only on licenses to hunt elk.
Disparity in rates has not been without criticism. U. S. Public Land Law Review Comm'n, One Third of the Nation's Land 174 (1970); Norman, Are Nonresident Hunters Getting a Fair Deal?, Outdoor Life, Sept. 1949, p. 21; Yeager, The Federal Take-Over, Montana Outdoors, Jan./Feb. 1975, p. 43; Editorial, Field & Stream, June 1974, p. 4.
[8] App. 56. Its estimated population in 1976 has been said to be 753,000. The World Almanac 695 (1978). Of the 50 States, Montana consistently has ranked 42d or lower in population since statehood. App. 56.
[9] It has been said that Montana is the State most frequently visited by nonresident hunters. All Outdoors, Michigan Natural Resources 27-28 (Sept.-Oct. 1975).
For the license year 1974-1975, Montana licensed hunters from each of the other 49 States, the District of Columbia, Puerto Rico, and 11 foreign countries. Defendants' Exhibit A, p. 8 (part of deposition of Don L. Brown). Approximately 43,500 nonresident hunting licenses for deer and elk were issued during that year. Id., at 7. The District Court found that elk hunting is recreational in nature and, "except for a few residents who live in exactly the right place," expensive. 417 F. Supp., at 1009. There was testimony that for a typical seven-day elk hunt a nonresident spends approximately $1,250 exclusive of outfitter's fee and the hunting license. Tr. 283-284. Thus, while the nonresident combination license fee is not insubstantial, it appears to be a lesser part of the overall expense of the elk hunt.
[10] The number of nonresident big-game combination licenses is now restricted to 17,000 in any one license year. Mont. Rev. Codes Ann. § 26-202.1 (16) (f) (Supp. 1977). This limitation was imposed by 1975 Mont. Laws, ch. 546, § 1, effective May 1, 1976.
The number of nonresident hunters has not yet reached the 17,000 limit. There are no similar numerical limitations on resident elk or deer licenses.
[11] The District Court concluded: "The elk is not and never will be hunted commercially." 417 F Supp., at 1007. Appellants do not deny that the activity which they wish to pursue is pure sport. The hunter is entitled to take only one elk per year, Montana Department of Fish and Game, Deer, Elk, Bear, and Mountain Lion Regulations, Feb. 27, 1977, and statutory restrictions are placed on the buying and selling of game animals, or parts thereof, taken in Montana. Mont. Rev. Codes Ann. § 26-806 (1967).
The Supreme Court of Montana has said: "In Montana, big game hunting is a sport." State ex rel. Visser v. Fish & Game Comm'n, 150 Mont. 525, 531, 437 P. 2d 373, 376 (1968).
[12] "[A] property owner in this state must recognize the fact that there may be some injury to property or inconvenience from wild game for which there is no recourse." State v. Rathbone, 110 Mont. 225, 242, 100 P. 2d 86, 93 (1940).
[13] The concession was repeated orally in this Court. Tr. of Oral Arg. 6.
[14] The District Court made no specific findings or conclusions about the standing of each of the five appellants. It ruled, however, that two of the nonresident plaintiff-appellants, Lee and Moris, had sufficient standing to maintain the suit. 417 F. Supp., at 1008. We agree, and find it unnecessary to make any further inquiry on standing. See Doe v. Bolton, 410 U. S. 179, 189 (1973).
[15] "The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States."
[16] "All persons born or naturalized in the United States and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside. No State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States; nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws."
[17] "The better to secure and perpetuate mutual friendship and intercourse among the people of the different States in this Union, the free inhabitants of each of these States, paupers, vagabonds and fugitives from justice excepted, shall be entitled to all privileges and immunities of free citizens in the several States; and the people of each State shall have free ingress and regress to and from any other State and shall enjoy therein all the privileges of trade and commerce, subject to the same duties, impositions and restrictions as the inhabitants thereof respectively . . . ."
[18] For a description of four theories proffered as to the purpose of the Clause, see S. Doc. No. 92-82, pp. 831-832 (1973).
[19] The opinion goes on to read:
"Indeed, without some provision of the kind removing from the citizens of each State the disabilities of alienage in the other States, and giving them equality of privilege with citizens of those States, the Republic would have constituted little more than a league of States; it would not have constituted the Union which now exists.
"But the privileges and immunities secured to citizens of each State in the several States, by the provision in question, are those privileges and immunities which are common to the citizens in the latter States under their constitution and laws by virtue of their being citizens. Special privileges enjoyed by citizens in their own States are not secured in other States by this provision. It was not intended by the provision to give to the laws of one State any operation in other States. They can have no such operation, except by the permission, express or implied, of those States. The special privileges which they confer must, therefore, be enjoyed at home, unless the assent of other States to their enjoyment therein be given." 8 Wall., at 180-181.
[20] It is possible that this is the language that Mr. Justice Roberts in the quotation, supra, at 381, from Hague v. CIO, 307 U. S., at 511, rather critically regarded as relating to "natural rights." We suspect, however, that he was referring to the more general preceding sentences in Mr. Justice Washington's opinion:
"The inquiry is, what are the privileges and immunities of citizens in the several states? We feel no hesitation in confining these expressions to those privileges and immunities which are, in their nature, fundamental; which belong, of right, to the citizens of all free governments; and which have, at all times, been enjoyed by the citizens of the several states which compose this Union, from the time of their becoming free, independent, and sovereign. What these fundamental principles are, it would perhaps be more tedious than difficult to enumerate. They may, however, be all comprehended under the following general heads: Protection by the government; the enjoyment of life and liberty, with the right to acquire and possess property of every kind, and to pursue and obtain happiness and safety; subject nevertheless to such restraints as the government may justly prescribe for the general good of the whole." 6 F. Cas., at 551-552.
[21] The rationale of these cases seems not to have been affected by the adoption of the Fourteenth Amendment and the inclusion therein of a new protection for "the privileges or immunities of citizens of the United States." Appellants do not argue that the State of Montana has deprived them of anything to which they are entitled under this provision, so we need not consider here the relationship between the Fourteenth Amendment and the Privileges and Immunities Clause of Art. IV. See Hague v. CIO, 307 U. S., at 511 (opinion of Roberts, J.); Slaughter-House Cases, 16 Wall. 36 (1873); R. Howell, The Privileges and Immunities of State Citizenship (1918).
[22] It is, of course, possible for residents, with single-animal licenses, hunting in groups to engage in license swapping.
[23] The appellants point to the facts that federal land in Montana provides a significant contribution to the elk habitat, and that substantial apportionments to the State flow from the Federal Aid in the Wild Life Restoration Act, 50 Stat. 917, as amended, 16 U. S. C. §§ 669-669i (1976 ed.). We fail to see how these federal aspects transform a recreational pursuit into a fundamental right protected by the Privileges and Immunities Clause, or how they impose a barrier to resident-nonresident differentials. Congress knows how to impose such a condition on its largess when it wishes to do so. See 16 U. S. C. § 669 (1976 ed.). See also Pub. L. 94-422, 90 Stat. 1314, adding § 6 (f) (8) to the Land and Water Conservation Fund Act of 1965, 16 U. S. C. § 4601-8 (f) (8) (1976 ed.).
[24] The dissenting opinion in the District Court ascribes to the majority there a holding that "an otherwise invidious discrimination against nonresidents is justified because the state may rationally consider the discrimination necessary to induce residents to support the state program required to conserve the herd." 417 F. Supp., at 1011. We agree with that dissent that the State's need or desire to engender political support for its conservation programs cannot by itself justify an otherwise invidious classification. Memorial Hospital v. Maricopa County, 415 U. S. 250, 266 (1974). But, in our view, the record, that is, the case as proved, discloses that the classification utilized in Montana's licensing scheme is not "otherwise invidious discrimination."
[1] See, e. g., Canadian Northern R. Co. v. Eggen, 252 U. S. 553, 560 (1920); Chambers v. Baltimore & Ohio R. Co., 207 U. S. 142, 155 (1907); Blake v. McClung, 172 U. S. 239, 248-249 (1898).
[2] For the purpose of analysis of most cases under the Privileges and Immunities Clause of Art. IV, the terms "citizen" and "resident" are "essentially interchangeable." Austin v. New Hampshire, 420 U. S. 656, 662 n. 8 (1975); Toomer v. Witsell, 334 U. S. 385, 397 (1948).
[3] The reason given was: "If the statute does not run as between nonresident creditors and their debtors, it might often happen that a right of action would be extinguished, perhaps for years, in the State where the parties reside; and yet, if the defendant should be found in Wisconsin,it may be only in a railroad train,a suit could be sprung upon him after the claim had been forgotten. The laws of Wisconsin would thus be used as a trap to catch the unwary defendant, after the laws which had always governed the case had barred any recovery. This would be inequitable and unjust." 93 U. S., at 77.
[4] Although it is true that a woman's right to choose to have an abortion is "fundamental" for purposes of equal protection analysis, Roe v. Wade, 410 U. S. 113 (1973), the Court did not rely on this fact and deemed all "medical services" within the protection of the Clause. Again no mention was made of Corfield.
[5] This is the cost ratio of the 1976 nonresident combination license fee ($225) to the 1976 resident combination license fee ($30). Since a Montana resident wishing to hunt only elk could purchase an elk-hunting license for only $9, a nonresident who wanted to hunt only elk had to pay a fee 25 times as great as that charged a similarly situated resident of Montana.
[6] These are the figures for all hunters in Montana, not only for those hunting elk. The Court's notation of the fact that the number of nonresident hunters in Montana has increased more dramatically than the number of resident hunters during the past decade, ante, at 374-375, thus somewhat overstates the putative conservation threat nonresident hunters pose for Montana's wildlife.
[7] This restriction on the number of big-game hunters allowed into Montana is thus not at issue.
[8] Because I find Montana's elk-hunting licensing scheme unconstitutional under the Privileges and Immunities Clause of Art. IV, § 2, I find it unnecessary to determine whether the scheme would pass equal protection scrutiny. In any event, where a State discriminates solely on the basis of noncitizenship or nonresidency in the State, see n. 1, supra, it is my view that the Equal Protection Clause affords a discriminatee no greater protection than the Privileges and Immunities Clause.
| {
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Case: 13-11844 Date Filed: 06/12/2014 Page: 1 of 14
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 13-11844
Non-Argument Calendar
________________________
D.C. Docket No. 1:11-cr-20773-JAG-1
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
OSMAN J. PAYAN,
Defendant-Appellant.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(June 12, 2014)
Before PRYOR, MARTIN, and ANDERSON, Circuit Judges.
PER CURIAM:
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Osman J. Payan appeals his convictions and sentences for conspiracy to
commit health care fraud, in violation of 18 U.S.C. § 1349, and health care fraud,
in violation of 18 U.S.C. § 1347, for his involvement with defrauding Medicare
through the fake company A-1 Medical. On appeal, Payan argues that the district
court committed several reversible evidentiary errors, including allowing the
admission of hearsay, speculative testimony, and by allowing the government to
lead witnesses. He further argues that even if there was no reversible error, the
district court committed enough harmless errors in the aggregate to deprive him of
his constitutional right to a fair trial. Additionally, Payan argues that the evidence
admitted at trial was insufficient to support his convictions because there was no
proof that he had knowledge of the conspiracy, there was no evidence that he
received any money for his involvement, and the government’s case was based on
inadmissible and circumstantial evidence.
Payan also argues that the district court erred at sentencing by applying an
aggravating role adjustment for being a leader or organizer to his Sentencing
Guideline calculation rather than a mitigating role adjustment for a minor role.
Additionally, he argues there was no evidence that he played a leading role, and he
maintains that he was recruited into the scheme. Finally, he argues that his
sentence was unreasonable because the district court did not grant him a downward
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variance, which was warranted because his codefendants received lesser sentences,
he had little criminal history, and he played a minor role.
I.
We review preserved challenges to evidentiary rulings for clear abuse of
discretion. United States v. Gamory, 635 F.3d 480, 492 (11th Cir. 2011). An
abuse of discretion occurs if the district court’s evidentiary decision was based on a
“clearly erroneous finding of fact, an errant conclusion of law, or an improper
application of law to fact.” United States v. Baker, 432 F.3d 1189, 1202 (11th Cir.
2005). Even if we determine that an abuse occurred, we will only overturn an
evidentiary ruling if it resulted in a substantial prejudicial effect. United States v.
Breitweiser, 357 F.3d 1249, 1254 (11th Cir. 2004).
The Federal Rules of Evidence provide that the district court exercises
“reasonable control over the mode and order of examining witnesses and
presenting evidence.” Fed.R.Evid. 611(a). It further provides that “[l]eading
questions should not be used on direct examination except as necessary to develop
the witness’s testimony.” Id. 611(c); see also United States v. Hewes, 729 F.2d
1302, 1325 (11th Cir. 1984) (holding that the district court has the discretion to
tolerate leading questions during direct examination).
Rule 701 limits opinion testimony by a lay witness to testimony that is “(a)
rationally based on the witness’s perception; (b) helpful to clearly understanding
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the witness’s testimony or to determining a fact in issue; and (c) not based on
scientific, technical, or other specialized knowledge within the scope of Rule 702.”
Fed.R.Evid. 701. However, “[a]n opinion is not objectionable just because it
embraces an ultimate issue.” Fed.R.Evid. 704(a).
“Hearsay is a statement, other than one made by the declarant while
testifying at the trial or hearing, offered in evidence to prove the truth of the matter
asserted.” United States v. Baker, 432 F.3d 1189, 1203 (11th Cir. 2005). A
statement that is not offered to prove the truth of the matter asserted is not hearsay.
See Fed.R.Evid. 801(c)(2). Hearsay is inadmissible unless the statement is deemed
not hearsay under Rule 801(d), or it falls within a hearsay exception. Baker, 432
F.3d at 1203. A statement offered against an opposing party is not considered
hearsay if it was made by that party in an individual or representative capacity.
Fed.R.Evid. 801(d)(2)(A). Further, statements made by a “coconspirator during
and in furtherance of the conspiracy” are not hearsay. Id. 801(d)(2)(E).
The Federal Rules of Evidence permit a witness that is having difficulty
recalling information to refresh her recollection through any writing. Fed.R.Evid.
612; United States v. Scott, 701 F.2d 1340, 1346 (11th Cir. 1983). This rule may
not be used to circumvent the Federal Rules of Evidence to introduce inadmissible
evidence. Scott, 701 F.2d at 1346. If the prosecution uses this evidentiary tool, the
defendant has the right to have the writing produced at the trial, inspect it, cross-
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examine the witness about it, and to introduce into evidence portions of the writing
relevant to the witness’s testimony. Fed.R.Evid. 612(b). If the prosecution does
not comply with such a request, the district court must strike the witness’s
testimony or declare a mistrial. Id. 612(c).
The district court did not commit a clear abuse of discretion at trial. The
district court permitted the government to lead witnesses when appropriate to
develop the witness’s testimony, which is permissible under the Federal Rules of
Evidence. Fed.R.Evid. 611(c); Hewes, 729 F.2d at 1325. Allowing the
investigating agent to provide an opinion about a material fact at trial was not error
because the opinion was rationally based on his perception, helpful to determine a
fact at issue, and not based on specialized knowledge. Fed.R.Evid. 701; see also
id. 704(a). Further, allowing the agent to refresh his recollection using another
agent’s report was not hearsay and was not erroneous because any writing may be
used for that purpose. Id. 612; Scott, 701 F.2d at 1346.
The district court did not allow impermissible hearsay at trial. Any out-of-
court statements made by Payan were not hearsay because they were admissions
by a party opponent. 801(d)(1)(A). Further, statements by others involved in the
conspiracy were not hearsay because they were statements made by co-
conspirators in furtherance of the conspiracy. Id. at 801(d)(2).
II.
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Under the cumulative error doctrine, we review the record as a whole to
determine whether the defendant was afforded a fundamentally fair trial. United
States v. Lopez, 590 F.3d 1238, 1258 (11th Cir. 2009). Both preserved and plain
errors are considered in the aggregate. Baker, 432 F.3d at 1203. The cumulative
effect of several harmless errors can result in the denial of the constitutional right
to a fair trial. Id. at 1223. The cumulative prejudicial impact of the several errors
depends upon: (1) the nature and number of the errors committed, (2) the
interrelatedness of the errors and their combined effect, (3) the district court’s
handling of the errors as they arose, and (4) the strength of the government’s case.
Id. However, if there are no errors, or only a single error, then there can be no
cumulative error. United States v. Waldon, 363 F.3d 1103, 1110 (11th Cir. 2004).
Further, we generally presume “that jurors follow their instructions.” United States
v. Hill, 643 F.3d 807, 829 (11th Cir. 2011).
Upon review of the record and the specific alleged errors that Payan
enumerates in his brief, there was no individual evidentiary error at trial. The
district court sustained many of Payan’s objections, struck evidence from the
record that was improperly received, and ensured that evidence would be admitted
properly. Because there was no error or even a single error, there was no
cumulative error. Waldon, 363 F.3d at 1110.
III.
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We review de novo a district court’s denial of a motion for judgment of
acquittal on sufficiency of evidence grounds, construing the evidence in the light
most favorable to the government. United States v. Capers, 708 F.3d 1286, 1296
(11th Cir. 2013), cert. denied, 134 S.Ct. 108 (2013). In making this determination,
all reasonable inferences and credibility choices are viewed in favor to the verdict.
Id. A verdict cannot be overturned if there is a reasonable construction of the
evidence that would allow the jury to find the defendant guilty beyond a reasonable
doubt. Id. at 1297. The evidence need not be inconsistent with every reasonable
hypothesis except that of a defendant’s guilt, and the jury is free to choose among
the reasonable conclusions drawn from the evidence. Id. Further, “[w]here
corroborative evidence of guilt exists for the charged offense . . . and the defendant
takes the stand in [his] own defense, the defendant’s testimony, denying guilt, may
establish, by itself, elements of the offense.” United States v. Williams, 390 F.3d
1319, 1326 (11th Cir. 2004).
To support a conviction for health care fraud under 18 U.S.C. § 1347, the
government must prove that the defendant: (1) knowingly and willfully executed,
or attempted to execute, a scheme to (2) defraud a health care program or to obtain
by false or fraudulent pretenses money or property under the custody or control of
a health care program, (3) “in connection with the delivery of or payment for
health care benefits, items, or services.” 18 U.S.C. § 1347. We have held that “the
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defendant must be shown to have known that the claims submitted were, in fact,
false.” United States v. Medina, 485 F.3d 1291, 1297 (11th Cir. 2007).
To establish conspiracy for a related conviction, the government must prove
that the defendant “knew of and willfully joined in the unlawful scheme to defraud;
circumstantial evidence can supply proof of knowledge of the scheme.” United
States v. Maxwell, 579 F.3d 1282, 1299 (11th Cir. 2009).
The evidence admitted at trial supported Payan’s convictions. The
government introduced a large amount of evidence demonstrating that Payan had
previously engaged in Medicare fraud before his involvement with A-1 Medical by
engaging in another related fraudulent scheme. The government introduced
evidence that Payan purchased L. Creagh Corporation, became the owner of that
company and the sole name on its bank account, and fraudulently billed over
$2,000,000 to Medicare. It provided fingerprint evidence on the sale documents
that tied Payan to the purchase of that company.
The evidence adduced at trial supported Payan’s convictions regarding his
involvement with the A-1 Medical scam to defraud Medicare. Co-conspirators
testified at trial that Payan agreed to join in the scheme, and each of them pooled
the money to purchase the company. Given his experience and knowledge with L.
Creagh and his co-conspirators’ testimonies about his involvement, there was
evidence to support that Payan conspired to defraud Medicare because he “knew of
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and willfully joined in the unlawful scheme to defraud.” Maxwell, 579 F.3d at
1299.
After fronting the money, evidence at trial supported the element that Payan
and his partners executed the scheme when they directed a nominee owner to
acquire A-1 Medical on their behalf, money was paid into A-1 Medical’s bank
account from Medicare, and the nominee owner withdrew the money to pay the
partners. Evidence showed that A-1 Medical fraudulently billed almost
$2,500,000, and Medicare reimbursed $614,599. Payan made an agreement with
another co-conspirator to open Med-X, a shell company, so he could receive his
reimbursements.
Further, Payan testified on his own behalf, denying he was guilty of his
offense. Along with the corroborating evidence above, this testimony, by itself,
was sufficient to establish the elements of the charged offenses. Williams, 390
F.3d at 1326. Thus, there was sufficient evidence for the jury to reasonably
conclude that Payan committed the crimes of conspiracy to commit health care
fraud and committing heath care fraud. Capers, 708 F.3d at 1296.
IV.
We review de novo questions of law implicating the Sentencing Guidelines.
United States v. Kapordelis, 569 F.3d 1291, 1314 (11th Cir. 2009). Elements of a
crime must be proved to the jury beyond a reasonable doubt, but “[s]entencing
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factors, on the other hand, can be proved to a judge at sentencing by a
preponderance of the evidence.” United States v. O’Brien, 560 U.S. 218, 224, 130
S.Ct. 2169, 2174, 176 L.Ed.2d 979 (2010). “[T]he essential Sixth Amendment
inquiry is whether a fact is an element of the crime,” which constitutes a fact that
alters the statutory range of legally prescribed sentences, and such a fact must be
submitted to the jury. Alleyne v. United States, 133 S.Ct. 2151, 2153, 186 L.Ed.2d
314 (2013). However, sentencing factors may guide or confine a judge’s
discretion when sentencing an offender within the statutory range. O’Brien, 560
U.S. at 224, 130 S.Ct. at 2174-75. Neither the Fifth nor Sixth Amendments
prevent the district court from finding facts that enhance a sentence under the
Sentencing Guidelines. United States v. Gibson, 434 F.3d 1234, 1246 (11th Cir.
2006).
The Sentencing Guidelines provide that, “[i]f a defendant was an organizer
or leader of a criminal activity that involved five or more participants or was
otherwise extensive, increase by 4 levels.” U.S.S.G. § 3B1.1(a). In determining
the role of a defendant in a criminal act, the district court should consider the
following:
(1) the exercise of decision making authority, (2) the nature of
participation in the commission of the offense, (3) the recruitment of
accomplices, (4) the claimed right to a larger share of the fruits of the
crime, (5) the degree of participation in planning or organizing the
offense, (6) the nature and scope of the illegal activity, and (7) the
degree of control and authority exercised over others.
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United States v. Gupta, 463 F.3d 1182, 1198 (11th Cir. 2006) (quoting U.S.S.G.
§ 3B1.1 cmt. n.4.) The Sentencing Guidelines also provide a mitigating role
adjustment, stating “[i]f the defendant was a minor participant in criminal activity,
decrease by two levels.” U.S.S.G. § 3B1.2(b). This section applies “to a defendant
. . . who is less culpable than most other participants, but whose role could not be
described as minimal.” Id. § 3B1.2 cmt. n.5.
The district court did not err by applying the four-level aggravating role
adjustment for Payan, because he was a leader and organizer in the scheme to
defraud Medicare. He was one of the three true owners of A-1 Medical, he
contributed to the money to purchase the company, and he recruited assistance to
receive his share of the profits. Thus, he met the criteria to be considered a leader
or organizer. See Gupta, 463 F.3d at 1198. The record does not support the notion
that Payan played a minor role. Furthermore, the district court’s findings that
enhanced Payan’s sentences did not violate his rights under the Fifth or Sixth
Amendment because they were sentencing factors, and the findings did not alter
the statutory range. See O’Brien, 560 U.S. at 224, 130 S.Ct. at 2174; Gibson, 434
F.3d at 1246.
V.
We review the reasonableness of a sentence under a deferential abuse-of-
discretion standard. Gall v. United States, 552 U.S. 38, 51, 128 S.Ct. 586, 597,
11
Case: 13-11844 Date Filed: 06/12/2014 Page: 12 of 14
169 L.Ed.2d 445 (2007). The district court must impose a sentence “sufficient, but
not greater than necessary, to comply with the purposes” listed in 18 U.S.C.
§ 3553(a)(2), including the need to reflect the seriousness of the offense, promote
respect for the law, provide just punishment for the offense, deter criminal conduct,
and protect the public from the defendant’s future criminal conduct. See 18 U.S.C.
§ 3553(a)(2). In imposing a particular sentence, the court must also consider the
nature and circumstances of the offense, the history and characteristics of the
defendant, the kinds of sentences available, the applicable guidelines range, the
pertinent policy statements of the Sentencing Commission, the need to avoid
unwarranted sentencing disparities, and the need to provide restitution for victims.
Id. § 3553(a)(1), (3)-(7). However, the district court need not discuss or explicitly
state on the record each § 3553(a) factor. United States v. Turner, 474 F.3d 1265,
1281 (11th Cir. 2007). “Rather, an acknowledgment by the district judge that he or
she has considered the § 3553(a) factors will suffice.” Id.
In reviewing the reasonableness of a sentence, we first ensure that the
sentence was procedurally reasonable, meaning the district court properly
calculated the guideline range, treated the Sentencing Guidelines as advisory,
considered the § 3553(a) factors, did not select a sentence based on clearly
erroneous facts, and adequately explained the chosen sentence. Gall, 552 U.S. at
51, 128 S.Ct. at 597. Once we determine that a sentence is procedurally sound, we
12
Case: 13-11844 Date Filed: 06/12/2014 Page: 13 of 14
examine whether the sentence was substantively unreasonable in light of the
totality of the circumstances. Id.
The party who challenges the sentence bears the burden of showing that the
sentence is unreasonable in light of the record and the § 3553(a) factors. United
States v. Tome, 611 F.3d 1371, 1378 (11th Cir. 2010). Although we do not
automatically presume a sentence falling within the guideline range to be
reasonable, we ordinarily expect such a sentence to be reasonable. United States v.
Hunt, 526 F.3d 739, 746 (11th Cir. 2008). There is no unwarranted sentencing
disparity for substantially differing sentence between a defendant who provided
substantial assistance and one that did not. United States v. Williams, 526 F.3d
1312, 1324 (11th Cir. 2008).
The weight given to any specific § 3553(a) factor is committed to the sound
discretion of the district court. United States v. Williams, 526 F.3d 1312, 1322
(11th Cir. 2008). However, we will reverse if left with the firm conviction that the
district court committed a clear error of judgment in weighing the § 3553(a) factors
by arriving at a sentence that lies outside the range of reasonable sentences dictated
by the facts of the case. United States v. Irey, 612 F.3d 1160, 1190 (11th Cir.
2010) (en banc).
Payan’s sentences are not unreasonable. The district court was not required
to make individualized findings for each § 3553(a) factor. The evidence showed
13
Case: 13-11844 Date Filed: 06/12/2014 Page: 14 of 14
that Payan played a leading role in two schemes that defrauded Medicare of
millions of dollars. Although Payan’s codefendants’ sentences are substantially
lower than his, the difference is not unwarranted because they provided the
government with substantial assistance. Williams, 526 F.3d at 1324. Further, his
sentences are within the guideline range, which we ordinarily expect to be
reasonable. Hunt, 526 F.3d at 746. Payan does not leave us with a “firm
conviction that the district court committed a clear error in judgment,” and he fails
to carry his burden that the sentence was unreasonable.
Upon review of the record and in consideration of the parties’ briefs, we
affirm.
AFFIRMED.
14
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914 F.Supp. 172 (1995)
William James COFFMAN, Plaintiff,
v.
STATE of Michigan, Defendant.
No. 5:94-CV-164.
United States District Court, W.D. Michigan, Southern Division.
October 26, 1995.
*173 Lance A. Fertig, L. A. Fertig & Associates, Owosso, MI, for plaintiff.
John S. Mackey, Frank J. Kelley, Attorney General, Public Employment & Elections Division, Lansing, MI, for defendants.
OPINION
QUIST, District Judge.
Plaintiff, William James Coffman, brought this action against defendants the State of Michigan, the United States Department of the Army, and the Michigan Army National Guard. An order dismissing the United States Army as a party to the case was filed on June 5, 1995. Under Count I of his Second Amended Complaint, plaintiff alleged that defendants violated his rights under the Americans With Disabilities Act (42 U.S.C. § 12101 et seq.), Title V of the Rehabilitation Act (29 U.S.C. § 791), and the Michigan Handicapper's Civil Rights Act (M.C.L. § 37.1101 et seq.). Under Count II of his Second Amended Complaint, plaintiff alleged that defendants violated his rights under the Due Process Clause of the Fourteenth Amendment to the United States Constitution. The Court retains jurisdiction over the suit pursuant to 28 U.S.C. § 1441. This matter is before the Court on a joint motion by the State of Michigan and the Michigan *174 Army National Guard to dismiss the case pursuant to Rules 12(c) or 56 of the Federal Rules of Civil Procedure.[1] The Court heard oral argument on October 24, 1995. For the reasons set forth below, defendants' motion will be granted.
Facts
Plaintiff was an officer in the United States Army from 1979 until he was discharged in 1993. When he was dismissed, plaintiff was a Major in the Active Guard Reserve ("AGR") program. On March 19, 1993, plaintiff was involuntarily released from the AGR program for his repeated failure to run two miles in the required time.
Plaintiff previously filed suit in the Michigan Court of Claims in Ingham County, Case No. 93-15018-CM (initially filed in Circuit Court), for handicapper discrimination relating to his termination. Plaintiff filed suit in state court before the Army Board of Correction of Military Records ("ABCMR") had the opportunity to rule on plaintiff's termination. On March 2, 1994, the ABCMR reviewed plaintiff's claims. (Docket No. A93-09522.) The ABCMR determined that the plaintiff "failed to submit sufficient relevant evidence to demonstrate the existence of probable error or injustice." ABCMR Mem. of Consideration at 6. On June 14, 1994, the Michigan Court of Claims granted defendants' motion for summary disposition for the reasons stated in the court's May 25, 1994 bench opinion.
Discussion
A. Summary Judgment Standard
Summary judgment is appropriate if there is no genuine issue as to any material fact and the moving party is entitled to a judgment as a matter of law. Fed.R.Civ.P. 56. The rule requires that the disputed facts be material. Material facts are facts which are defined by substantive law and are necessary to apply the law. A dispute over trivial facts which are not necessary in order to apply the substantive law does not prevent the granting of a motion for summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). The rule also requires the dispute to be genuine. A dispute is genuine if a reasonable jury could return judgment for the non-moving party. Id. This standard requires the non-moving party to present more than a scintilla of evidence to defeat the motion. The summary judgment standard mirrors the standard for a directed verdict. The only difference between the two is procedural; summary judgment is based on documentary evidence before trial, and directed verdict is based on evidence submitted at trial. 477 U.S. at 250-51, 106 S.Ct. at 2511.
A moving party who does not have the burden of proof at trial may properly support a motion for summary judgment by showing the court that there is no evidence to support the non-moving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 324-25, 106 S.Ct. 2548, 2553-54, 91 L.Ed.2d 265 (1986). If the motion is so supported, the party opposing the motion must then demonstrate with "concrete evidence" that there is a genuine issue of material fact for trial. Id.; Frank v. D'Ambrosi, 4 F.3d 1378, 1384 (6th Cir.1993). The court must draw all inferences in a light most favorable to the non-moving party, but the court may grant summary judgment when "the record taken as a whole could not lead a rational trier of fact to find for the non-moving party." Agristor Financial Corp. v. Van Sickle, 967 F.2d 233, 236 (6th Cir.1992) (quoting Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986)).
B. Civil Rights/Handicap Discrimination (Count I)
1. Res Judicata
Claims are barred in federal court under the doctrine of res judicata where the claims would be barred under the doctrine if brought a second time in state court. Gutierrez v. Lynch, 826 F.2d 1534, 1537 (6th Cir.1987). Under Michigan law, the doctrine *175 of res judicata should be applied when: (1) the prior action was decided on the merits; (2) the issues raised in the second case have been resolved in the first; and (3) both actions have involved the same parties or their privies. Wildfong v. Fireman's Fund Ins., 181 Mich.App. 110, 114, 448 N.W.2d 722 (1989). The second and third elements are satisfied because plaintiff alleges the same handicap discrimination claims against the same parties that he did in state court. In reference to plaintiff's state court claims, Circuit Court Judge William Collette stated that "it was filed in circuit court and actually it's a Court of Claims case ... we put it in Court of Claims on our own, evidently, because that's the correct vehicle. But, there's nothing in here about an administrative review." Motion for Summary Disposition Transcript ("Trans.") at 7. Thus, Judge Collette held that plaintiff was in the correct court. In reference to the handicap discrimination laws, Judge Collette went on to rule that "the military has no obligation to comply with any of these types of law." Trans. at 9. In reference to the rights plaintiff would normally retain under the discrimination statutes, Judge Collette held that "these kinds of rights don't apply." Trans. at 10.
Only after holding that the Court of Claims was the "correct vehicle" and that plaintiff's claims were substantively unsound did Judge Collette maintain that "[t]he correct vehicle here is through the Board to Correct Military Records and an administrative appeal of that or a lawsuit in federal court." Trans. at 10. Apparently, Judge Collette was unimpressed with plaintiff's legal strategy. Judge Collette distinguished his recommendation that plaintiff appeal the ABCMR's decision from the case he was actually presiding over when he told plaintiff's counsel, "I don't know how you can stand here and tell me this is supposedly an administrative appeal when it's in the Court of Claims, first of all. Secondly, I don't know how you can tell me it's an administrative appeal when it's filed before the appeal board renders a decision." Trans. at 10-11. Thus, the case that Judge Collette dismissed was not an administrative appeal. Judge Collette repeated his recommendation when he again stated to plaintiff that "the correct procedure is through the military's own system and through the appellate process." Trans. at 11.
Because Judge Collette ruled on the merits of plaintiff's claims under the handicap discrimination statutes, Count I of Plaintiff's Second Amended Complaint is barred by the doctrine of res judicata.
2. Substantive Merits of Count I
Even if the Court were to decide that the doctrine of res judicata did not bar Count I, the plaintiff would still be unable to prevail under the standard for summary judgment. Both parties agree that the Americans With Disabilities Act, Title V of the Rehabilitation Act, and the Michigan Handicapper's Civil Rights Act do not limit the Secretary of the Army's plenary authority to determine the physical qualifications for service in the Guard. Plaintiff contends that the Army discriminated against him by failing to "reasonably accommodate" his ulcer and allow him a third opportunity to run two miles in the required time after he had been promised the opportunity.
Even though plaintiff does not ask the Court to alter the Army's physical standards for service, granting his request for a "reasonable accommodation" would nevertheless require an impermissible encroachment on the Army's authority by the Court, especially as it relates to personnel decisions. The Supreme Court has held that
[c]ivilian courts must, at the very least, hesitate long before entertaining a suit which asks the court to tamper with the established relationship between enlisted military personnel and their superior officers; that relationship is at the heart of the unique structure of the military establishment. ... `Orderly government requires that the judiciary be as scrupulous not to interfere with legitimate Army matters as the Army must be scrupulous not to intervene in judicial matters.'
Chappell v. Wallace, 462 U.S. 296, 300-01, 103 S.Ct. 2362, 2366, 76 L.Ed.2d 586 (1983) (quoting Orloff v. Willoughby, 345 U.S. 83, 93-94, 73 S.Ct. 534, 540, 97 L.Ed. 842 (1953) on page 301). The Supreme Court is concerned that there will be a disruption of the *176 relationship between soldiers and their superiors, and therefore a disruption of military hierarchy and discipline, if soldiers were allowed to hale their superiors into court. Chappell, 462 U.S. at 303, 103 S.Ct. at 2367. These considerations led the Supreme Court to re-emphasize the military's broad authority to handle its own personnel. Chappell, 462 U.S. at 305, 103 S.Ct. at 2368. These considerations are also applicable to the National Guard and its personnel because the Supreme Court has recognized that the "Guard is an essential reserve component of the Armed Forces of the United States." Gilligan v. Morgan, 413 U.S. 1, 7, 93 S.Ct. 2440, 2444, 37 L.Ed.2d 407 (1973).
Civil claims "in civilian courts challenging personnel decisions of the military services have an undeniable potential for undermining military discipline and thus for impairing training programs and operational readiness." Watson v. Arkansas Nat. Guard, 886 F.2d 1004, 1008 (8th Cir.1989) (reviewing a 42 U.S.C. § 1983 claim against the National Guard). Whether or not the Army "reasonably accommodated" plaintiff's ulcer would require the Court to investigate and possibly alter the methods by which the Army determines who is and who is not physically able to serve. This sort of inquiry is clearly inappropriate in light of Chappell and related cases.
C. Due Process Violation (Count II)
Count II of plaintiff's Second Amended Complaint alleges that he was deprived of Due Process when the Army arbitrarily denied him a third opportunity to meet the required physical fitness standards. When reviewing whether procedural Due Process was satisfied under the Fourteenth Amendment, a court will ordinarily weigh the following three factors:
[f]irst, the private interest that will be affected by the official action; second, the risk of erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional procedural safeguards; and finally, the Government's interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirements would entail.
Zinermon v. Burch, 494 U.S. 113, 127, 110 S.Ct. 975, 984, 108 L.Ed.2d 100 (1990) (quoting Mathews v. Eldridge, 424 U.S. 319, 335, 96 S.Ct. 893, 903, 47 L.Ed.2d 18 (1976)).
In the instant case, however, the Supreme Court has already held that the forum provided by the Army Board of Correction of Military Records ("ABCMR") comports with Due Process. The Supreme Court has held that "`judges are not given the task of running the Army. The responsibility for setting up channels through which ... grievances can be considered and fairly settled rests upon the Congress and upon the President of the United States and his subordinates.'" Chappell, 462 U.S. at 301, 103 S.Ct. at 2366 (quoting Willoughby, 345 U.S. at 93-94, 73 S.Ct. at 540). The Supreme Court found the procedures provided by the ABCMR sufficient as the remedy Congress has chosen to provide. Chappell, 462 U.S. at 302-303, 103 S.Ct. at 2366-67. The ABCMR's decisions are ultimately subject to judicial review and may be set aside if they are arbitrary, capricious, or are not supported by substantial evidence. Id. at 303, 103 S.Ct. at 2367.
Plaintiff has availed himself of the procedures provided by the Army. The ABCMR reviewed plaintiff's claims on March 2, 1994. Plaintiff makes no allegation that the decision rendered by the ABCMR was either arbitrary, capricious, or not supported by substantial evidence. Neither the ABCMR, the United States Army, or the Secretary of the Army remains a party to this lawsuit. Plaintiff's contention that the decision to take away his third opportunity to pass the physical exam was "arbitrary" is not the equivalent of stating that the ABCMR's decision to uphold his termination was arbitrary. The factual question of whether or not plaintiff was actually granted a third opportunity is immaterial to the disposition of the case. This factual question should arise only in an appeal from the ABCMR's decision, which the plaintiff has not pursued.
Plaintiff has thus far been accorded the procedural Due Process required by the Constitution. Because the Supreme Court has *177 held that the ABCMR accords with procedural Due Process, Count II of plaintiff's Second Amended Complaint must fail.
ORDER
In accordance with the Opinion issued on this date,
IT IS HEREBY ORDERED that defendant's Motion For Summary Judgment (docket no. 15) is GRANTED. Plaintiff's complaint is DISMISSED.
NOTES
[1] Because the Court will utilize the standards set forth in Rule 56 of the Federal Rules of Civil Procedure, defendants' misnamed motion will be referred to as a motion for summary judgment in the Order.
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256 U.S. 540 (1921)
YAZOO & MISSISSIPPI VALLEY RAILROAD COMPANY ET AL.
v.
NICHOLS & COMPANY.
No. 216.
Supreme Court of United States.
Argued April 22, 1921.
Decided June 1, 1921.
CERTIORARI TO THE SUPREME COURT OF THE STATE OF MISSISSIPPI.
Mr. Charles N. Burch, with whom Mr. H.D. Minor, Mr. Clinton H. McKay and Mr. W.S. Horton were on the brief, for petitioners.
Mr. John W. Cutrer, with whom Mr. Sam C. Cook, Jr., and Mr. John C. Cutrer were on the brief, for respondent.
*543 MR. JUSTICE BRANDEIS delivered the opinion of the court.
In November, 1917, the Yazoo & Mississippi Valley Railroad Company issued to Nichols & Company a bill of lading for 31 bales of cotton which had been loaded into a box car at Alligator, Mississippi, for shipment to Memphis, Tennessee. Before the loaded car had been attached to any train or engine it was destroyed by fire. The shipper sued in a state court of Mississippi to recover the value of the cotton. The carrier contended that by the terms of the bill of lading it was relieved from liability. The provision relied upon was the second clause of the last paragraph of section 5 of the Uniform Bill of Lading, approved by the Interstate Commerce Commission June 27, 1908, and duly filed and published as part of the railroad's tariff. The paragraph referred to is this:
"Property destined to or taken from a station, wharf, or landing at which there is no regularly appointed agent shall be entirely at risk of owner after unloaded from cars or vessels or until loaded into cars or vessels, and when received from or delivered on private or other sidings, wharves, or landings shall be at owner's risk until the cars are attached to and after they are detached from trains."
The shippers insisted that the provision did not apply, because at Alligator there was a regularly appointed agent and that the second clause of the paragraph, like the first, was applicable only to stations where there was none. The shippers also contended, on the following facts which *544 were undisputed, that the place where the car was received was, in effect, a part of the carrier's terminal and not a "private or other" siding within the meaning of the above provision.
The cotton had been loaded from the platform of a gin located at the blind end of a spur which leads from the main line at a point near the depot. The spur which is 1,000 feet long had been built by the railroad many years before at its own expense. About half of it is on the railroad right of way and runs parallel to the main line; the rest is on private land. Under the contract for building the spur the landowner furnished free the right of way over his own land; but the railroad was to have full control over the spur and reserved the right to abandon it at any time and remove the track material. The spur was used generally by the public for loading and unloading carload freight. The only track scale at Alligator was on it as was also another gin.
Each party requested a directed verdict. A verdict was directed for the shippers. The judgment entered thereon was affirmed by the Supreme Court of Mississippi on the ground that the clause in question applies only to stations at which there is no regularly appointed agent. 120 Mississippi, 690. In the appellate courts of the States in which the question had arisen the decisions were conflicting.[1] For this reason a writ of certiorari was granted. 251 U.S. 550. The only question requiring decision here *545 is whether the court below gave the correct construction to the clause. In our opinion it did.
Whether goods destroyed, lost or damaged while at a railroad station were then in the possession of the carrier as such, so as to subject it to liability in the absence of negligence, had, before the adoption of the Uniform Bill of Lading, been the subject of much litigation. At stations where there is a regularly appointed agent the field for controversy could be narrowed by letting the execution of a bill of lading or receipt evidence delivery to and acceptance by the carrier; and by letting delivery of goods to the consignee be evidenced by surrender of the bill or execution of a consignee's receipt. But at non-agency stations this course is often not feasible. There the field for controversy as to the facts was particularly inviting and the reasons persuasive for limiting the carrier's liability. Local freight trains are often late. Shippers or consignees cannot be expected to attend on their arrival. Less than carload freight awaiting shipment must ordinarily be left on the station platform to be picked up by the passing train and lots arriving must be dropped on the platform to be called for by the consignee. At such stations the situation in respect to carload freight is not materially different. And this is true whether the car be loaded for shipment on the public siding or on a neighboring private siding, and whether the arriving loaded car be shunted onto a public siding or a private siding. There carload, as well as less than carload, freight, whether outgoing or incoming, must ordinarily be left unguarded for an appreciable time. It is not unreasonable that shippers at such stations should bear the risks naturally attendant upon the use. The reason why an agent is not appointed is that the traffic to and from the station would not justify the expense. The station is established for the convenience of shippers customarily using it. And the paragraph here in question *546 was apparently designed to shift the risk from the carrier to shipper or consignee of both classes of freight. It does so in the case of less than carload freight by having the carrier's liability begin when the goods are put on board cars and end when they are taken off. It does so in the case of carload freight by limiting liability to the time when the car is attached to or detached from the train. But, at a station where there is a regularly appointed agent, it would be obviously unreasonable to place upon the shipper, after a bill of lading has issued, the risks attendant upon the loaded car remaining on the public siding because it has not yet been convenient for the carrier to start it on its journey. It would likewise be unreasonable to place upon the consignee at such a station the risk attendant upon the arriving car's remaining on the siding before there has been notice to the consignee of arrival and an opportunity to accept delivery. The situation there would be practically the same whether the loaded cars were left standing on a public siding or on a siding to a private industry on the railroad's right of way, as in Swift & Co. v. Hocking Valley Ry. Co., 243 U.S. 281, or on a siding, partly on the railroad's right of way and partly on private land, as in Chicago & Northwestern Ry. Co. v. Ochs, 249 U.S. 416, and Lake Erie & Western R.R. Co. v. State Public Utilities Commission, 249 U.S. 422, when the siding is, either by state law or by agreement and in fact, a part of the carrier's terminal system.
If we approach the construction of the second clause of the last paragraph of section 5 of the Uniform Bill of Lading in the light of this practical situation all doubt as to its meaning must vanish. It could not have been intended that at stations where there are regularly appointed agents outgoing loaded cars for which bills of lading have issued and which are left standing on a siding solely to await the carrier's convenience are to be at the risk of the shipper. And this is true whether the siding *547 be a strictly public one, or a semi-public one as in the Ochs and Lake Erie & Western Cases, supra, and the case at bar; or whether it be a siding privately used but owned by the railroad as in the Swift Case, supra; and in such cases the fact that the spur extends over land not part of the carrier's right of way is immaterial. The construction contended for by the railroad, even if not applied to team tracks in the freight yards of a great city, would place all loaded cars arriving elsewhere at the owner's risk from the moment they were detached from a train, although the consignee had not even been notified of their arrival.
It is clear that the immunity conferred by the last paragraph of section 5 does not apply to loaded cars on the spur here involved. Whether the same rule should apply to cars on strictly private industry tracks effectively separated from the terminal and exclusively under private control, like the industry tracks involved in Bers v. Erie R.R. Co., 225 N.Y. 543, we have no occasion to determine.
Affirmed.
NOTES
[1] The clause was held not applicable in McClure v. Norfolk & Western Ry. Co., 83 W. Va. 473; Jolly v. Atchison, Topeka & Santa Fe Ry. Co., 21 Cal. App. 368. It was applied under different facts in Chickasaw Cooperage Co. v. Yazoo & Mississippi Valley R.R. Co., 141 Arkansas, 71; Standard Combed Thread Co. v. Pennsylvania R.R. Co., 88 N.J.L. 257; Bers v. Erie R.R. Co., 225 N.Y. 543; 163 N.Y. Supp. 114; Siebert v. Erie R.R. Co., 163 N.Y. Supp. 111. See also Bianchi & Sons v. Montpelier & Wells River R.R., 92 Vermont, 319; Bainbridge Grocery Co. v. Atlantic Coast Line R.R. Co., 8 Ga. App. 677.
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850 F.Supp. 309 (1994)
Frederic A. CONJOUR
v.
WHITEHALL TOWNSHIP and Elizabeth L. Buchmiller.
Civ. A. No. 92-3831.
United States District Court, E.D. Pennsylvania.
April 18, 1994.
*310 *311 William H. Platt, Eckert, Seamans, Cherin & Mellott, Allentown, PA, for plaintiff.
Donald E. Wieand, Jr., John P. Servis, and Irene M. Chiavaroli, Weaver, Mosebach, Piosa, Hixson & Marles, Allentown, PA, for defendants.
MEMORANDUM AND ORDER
ANITA B. BRODY, District Judge.
In the context of a motion for summary judgment, I must initially decide whether a township police chief who was terminated shortly after the ascent of a new township executive may maintain a procedural due process claim against the township and township executive for their failure to give him notice and a hearing before terminating him when (a) he asserts a property interest grounded in civil service regulations, but his appointment to the position was not carried out in strict compliance with the regulations, (b) and a liberty interest based on damage to his reputation having occurred in conjunction with his termination. I find that because the plaintiff was not appointed in strict compliance with the civil service regulations, he cannot claim a property interest for which process was due. I do find, however, that plaintiff has raised a material issue of fact regarding violations of his liberty interests, caused by damage to his reputation having occurred during the course of his termination, which would entitle him to procedural due process rights.
I must also determine whether plaintiff may maintain a claim that he was fired because of his political affiliation based on evidence that he was terminated in order to make room for a replacement chosen for political affiliations, even if plaintiff's own political activities were not implicated, and if so, whether plaintiff's position was one for which political affiliation was an appropriate consideration. I find that plaintiff may maintain such a claim even when his own political activities did not motivate the termination, and that he has raised a material issue of fact regarding whether political affiliation was a permissible factor in personnel decisions for his position.
I. STATEMENT OF MATERIAL FACTS
The following facts are either undisputed, or, where a material dispute exists, must be construed most favorably to the plaintiff in order to decide this motion for summary judgment. Plaintiff Frederic A. Conjour was appointed to the position of Chief of Police of Whitehall Township on September 30, 1980. Declaration of William H. Platt, Exh. B ("Platt Decl."). Although this was Mr. Conjour's first position with the Whitehall Township Police Department, he brought to his position sixteen years of experience as a police officer, three years of which were served as Chief of Police for West Grove Police Department in Baltimore, Maryland. Platt Decl. Exh. 3. Prior to his appointment by Whitehall Township, Mr. Conjour asserts that he was subjected to a two-hour long, oral, non-competitive examination under the authority of the Pennsylvania Department of *312 Community Affairs ("DCA"). Id. (Aug. 14, 1980 letter); Deposition of Frederic A. Conjour at 8-17 ("Conj. Dep."). This testing encompassed such topics as police administration, departmental organization, disciplinary actions, situational problems, and supervisory techniques. Conj. Dep. at 13-16. Mr. Conjour claims that during his interview for this position, inquiries were also made regarding his background, experience and education. Defendants challenge Mr. Conjour's characterization of his oral examination by the DCA as the equivalent of a civil service examination.
The appointment of Chief of Police is regulated by various sections of the civil service rules which were promulgated by the Whitehall Township Civil Service Commission ("Commission"). According to the defendants, Mr. Conjour's appointment did not meet the requirements of two of these regulations.[1] Resolution No. 23, adopted by the Commission in 1964, requires that all candidates for the position of Chief of Police submit to a non-competitive civil service examination administered by the Commission. Defendants' Exh. A. The DCA, not the Commission, conducted Mr. Conjour's examination. Conj. Dep. at 8-17. However, Rule 604 of the Civil Service Regulations expressly authorizes testing by outside agencies, including the DCA. Platt Decl., Exh. 3. Luella Bundy, a member of the Commission, testified that she conducted an investigation confirming that Mr. Conjour was examined by the DCA, and informed other Commission members of that fact. Deposition of Luella Bundy, at 93. Resolution No. 23 also requires that any candidate appointed to the position of Chief of Police have at least ten years of service with the Whitehall Township Police Department. Defendants' Exh. A.
Harold D. Roach of the DCA notified the Township Executive, Edward Galgon, that Mr. Conjour was unanimously ranked first among all the candidates for the position of Chief of Police due to his performance on the oral examination. Platt Decl., Exh. B. Mr. Galgon then offered Mr. Conjour the position of Chief of Police and his appointment was approved by the Board of Commissioners on September 30, 1980 in a meeting attended by members of the Commission. Conj. Dep. at 13-17.
After Mr. Conjour began working, the Township provided him with a job description and a personnel manual detailing his duties as Chief of Police. Declaration of Frederic A. Conjour ("Conj. Decl."), Exh. 1; Platt Decl., Exh. 4 (Interrog. 22). According to Mr. Conjour, both of these items placed all policymaking authority over the Police Department with the Township Executive, not the police chief. Id. The defendants dispute this characterization. See Defendants' Reply Brief in Support of Motion for Summary Judgment.
The manual also contains a discharge procedure which provides that employees disciplined for unsatisfactory work performance will be subject on the first instance to a warning, on the second to a three day suspension, and finally, discharge. Conj. Decl., Exh. 2. The plaintiff never experienced a warning, or suspension. The manual also contains a disclaimer against the manual being treated as a contract, or in any way altering the at-will arrangement between the parties. Conj. Decl., Exh. 2.
In May of 1991 defendant Elizabeth L. Buchmiller was elected to the position of Whitehall Township Executive. Conj. Dep. at 32. Ms. Buchmiller was a registered member of the Democratic Party and ran in the Democratic primary election for Township Executive. Buchmiller Dep. at 12. She was also a write-in candidate on the Republican side and won that primary election as well. Id.
According to Mr. Conjour, both before and after Ms. Buchmiller won the primary election *313 for the position of Township Executive, she told Michael Sefcik and others that Mr. Sefcik would replace Mr. Conjour as Chief of Police. See Snyder Dep. at 140-43; Bundy Dep. at 104-05; Platt Decl., Exh. 4 (Interrog. 8). Mr. Sefcik was a patrolman in the Whitehall Township Police Department. Mr. Sefcik and Ms. Buchmiller have been friends for fifteen years, and Mr. Sefcik supported Ms. Buchmiller during her 1991 campaign for the position of Township Executive. Buchmiller Dep. at 18-19; Bundy Dep. at 107, 120; Snyder Dep. at 140-44, 147, 154-55. Mr. Sefcik attended picnics hosted by Ms. Buchmiller, made yard signs for her during her campaign, and obtained a limousine for Ms. Buchmiller's use during her inauguration. Id. Ms. Buchmiller has acknowledged her friendship with Mr. Sefcik, and testified that she selected Mr. Sefcik as a candidate for the position of Chief of Police because of their long-time friendship. Buchmiller Dep. at 19, 44-45.
Mr. Conjour claims that approximately seven months after Ms. Buchmiller's election he was told by outgoing Township Executive Michael Harkal that he would be fired because of his political affiliations and failure to support Ms. Buchmiller's campaign. Conj. Dep. at 23. At all times during his employment with the Whitehall Township Police Department Mr. Conjour was a registered member of the Republican Party. Platt. Decl., Exh. 4 (Interrog. 1). However, Mr. Conjour maintains that, given his position as Chief of Police, he refrained from open political activities such as endorsing Republican or Democratic candidates for elected office. Id. at Interrogs. 4-6. Nonetheless, Mr. Conjour asserts that Ms. Buchmiller had access to records maintained in the Whitehall Township Treasurer's Office, Lehigh County Tax Office, and the Whitehall Township Solicitor, which contained background information regarding Mr. Conjour's political affiliation. Id. at Interrogs. 7-8. In addition, Mr. Conjour claims both Ms. Buchmiller and Mrs. Conjour, plaintiff's wife, were active in a 1989 political campaign for District Justice for District Court 31-1-07. Id. As a result of Mrs. Conjour's participation in this campaign, Mrs. Conjour's political connections with the Republican Party were published in the newspaper. Id.
Mr. Conjour received a termination letter from Ms. Buchmiller, dated January 17, 1992, citing various grounds for his dismissal. Ms. Buchmiller referred to Mr. Conjour's "continued inability to fulfill his duties and responsibilities" as the primary grounds for his dismissal. Conj. Decl., Exh. 4. Ms. Buchmiller elaborated on Mr. Conjour's alleged deficiencies in his termination letter stating that:
Among these inabilities are your failure to maintain the morale of the Department, your inability to make fair duty assignments without regard to favoritism or personal non-job-related considerations, your inability to maintain the dignity and decorum expected of the chief legal enforcement officer of the Township, and the need for a managerial reorganization of the Whitehall Township Police Department for the increased efficiency of operations.
Conj. Decl., Exh. A. Mr. Conjour was denied notice and the opportunity to rebut these allegations in a civil service hearing. In his eleven years with the Whitehall Township Police Department, Mr. Conjour asserts that he was never disciplined, and that he had in fact received numerous letters of commendation. Conj. Dep. at 32; Conj. Decl., ¶ 5 & Exhs. 4-5.
Mr. Conjour's termination was well publicized in numerous newspaper articles. Conj. Decl., ¶¶ 6-7 & Exh. 3. Ms. Buchmiller detailed the purported reasons for Mr. Conjour's termination to the media, stating that Mr. Conjour "did not adequately maintain the image [she] would expect of the chief law enforcement officer in the township," that the Police Department had been inefficiently run, and that Mr. Conjour failed to fulfill his duties. Conj. Decl., Exh. 3, Jan. 18, 1992 article, Jan. 25, 1992 article; see also Conj. Decl. Exh. 3, articles dated Feb. 4, 1992, March 20, 1992, and Oct. 15, 1992.
Mr. Sefcik was unsuccessful in replacing Mr. Conjour as Chief of Police. Buchmiller Dep. at 49. Mr. Sefcik was required to take a civil service examination as a prerequisite to employment as Chief of Police. Township Commissioners Linda Snyder and Glenn Solt *314 testified that members of the Civil Service Commission were allegedly threatened with removal if they did not provide Mr. Sefcik with a test that he could pass. See Bundy Dep. at 106, 113-14, 122-23; Solt Dep. at 30-34; Snyder Dep. at 156-57. Commissioner Solt testified that he had known Mr. Sefcik since 1972, and that, in his opinion, Mr. Sefcik was the least qualified individual to fill the position of Chief of Police. Commissioner Solt cited Mr. Sefcik's low arrest totals and failure to pass two promotional examinations as the basis of his unfavorable appraisal of Mr. Sefcik's qualifications. Id. at 10-11, 24. Ms. Buchmiller testified that she was aware that Mr. Sefcik had twice failed promotional exams and had no supervisory experience; she did not comment on his low arrest record. Buchmiller Dep. at 44-45. Mr. Sefcik's name was ultimately withdrawn as a candidate for the position of Chief of Police because of his failure to pass the civil service examination. Several commissioners testified that after Sefcik failed, Buchmiller forced the disbanding of the Commission. See Bundy Dep. at 105, 113-14, 122-23; Solt Dep. at 30-34; Snyder Dep. at 156-57.
Immediately after his termination as Chief of Police, Mr. Conjour began looking for full-time employment. Mr. Conjour applied for sixty positions around the country, but was unable to locate any full-time employment until April 5, 1993, when he was offered his current position as a patrolman for the Northampton Borough Police Department in Pennsylvania. Conj. Dep. at 5, 42-44. Mr. Conjour maintains that the wide-spread media coverage of his termination frustrated his job search because he was forced to address and rebut Ms. Buchmiller's allegations during job interviews. Conj. Decl., ¶¶ 6-7 & Exh. 3. At the time of his termination, Mr. Conjour was forty-eight years old. Conj. Dep. at 5. Mr. Sefcik was approximately five years younger than Mr. Conjour. Conj. Decl., Exh. 5, ¶ 6-7 & Exh. 3.
Conjour has sued under civil rights law 42 U.S.C. § 1983, claiming that Buchmiller and the Township violated his procedural due process and First Amendment rights, as well as the Age Discrimination in Employment Act.
II. DISCUSSION
A. Summary Judgment Standard
Summary judgment is appropriate where "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). Defendants are entitled to summary judgment only if no reasonable resolution of the conflicting evidence and the inference which could be drawn from that evidence could result in a judgment for the plaintiff. Anderson v. Liberty Lobby Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). Where there is a dispute or disagreement over what inferences reasonably could be drawn from the facts, even if those facts are undisputed, it is improper to grant summary judgment. See Nathanson v. Medical College of Pennsylvania, 926 F.2d 1368, 1380 (3d Cir.1991). However, "the mere existence of a scintilla of evidence in support of plaintiffs['] position will be insufficient[;] there must be evidence on which the jury could reasonably find for the plaintiff[s]." Anderson, 477 U.S. at 252, 106 S.Ct. at 2512.
The party moving for summary judgment must demonstrate that, under the undisputed facts, the non-movant has failed to introduce evidence supporting necessary elements of their case. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986). If the movant has demonstrated such a failure, the burden then shifts to the non-movant to identify which portions of the records support the allegedly unsupported elements. Id. at 322-23, 106 S.Ct. at 2552-53.
B. Due Process Claim
The plaintiff alleges that the defendants violated his Fourteenth Amendment right to procedural due process when the defendants terminated him without notice or a hearing. It is undisputed that plaintiff was not afforded a hearing either before or after the termination of his employment. The plaintiff asserts that he was entitled to a hearing because *315 he was deprived of a property interest in employment created by the Township's Civil Service Rules and his employee manual, and because he was deprived of liberty when in the course of terminating him the defendants also damaged his opportunities for future employment by making public statements that damaged his reputation.
1. Due Process Claim for Deprivation of Property
The question of whether Mr. Conjour possessed a legitimate property interest in continued employment with the Whitehall Township Police Department is resolved with reference to state law. See Board of Regents v. Roth, 408 U.S. 564, 577, 92 S.Ct. 2701, 2709, 33 L.Ed.2d 548 (1972) ("Property interests ... are not created by the Constitution. Rather, they are defined by existing rules or understandings that stem from an independent source such as state law rules, or understandings that secure certain benefits and that support claims of entitlement to those benefits."). While civil service protection can create that property interest, it is well settled under Pennsylvania law that before municipal employees may invoke the protection afforded by civil service regulations they must first demonstrate that their appointment was in compliance with those laws. See Municipality of Penn Hills v. Municipality of Penn Hills Personnel Bd./Civil Serv. Comm'n, 87 Pa.Cmwlth. 552, 487 A.2d 1048, 1050 (1985) ("the application of the civil service laws is a two way street, i.e., before one may invoke the protection afforded thereby, one must show that an appointment or promotion was in accordance with the laws in effect at the time of the appointment or promotion"); see also Bernardi v. City of Scranton, 598 F.Supp. 26, 30-32 (M.D.Pa. 1984); Gallagher v. Board of Comm'rs, 438 Pa. 280, 283, 264 A.2d 699, 701 (1970); Snizaski v. Zaleski, 410 Pa. 548, 549, 189 A.2d 284 (1963); Manning v. Civil Serv. Cmm'n of Milbourne, 387 Pa. 176, 179, 127 A.2d 599, 600-01 (1956); Detoro v. Pittston, 344 Pa. 254, 260, 25 A.2d 299, 302 (1942).
In determining whether civil service protection attaches, courts have repeatedly held that strict, not merely, substantial compliance is required. Bernardi, 598 F.Supp. at 31; Snizaski, 410 Pa. at 550, 189 A.2d 284. While such strict compliance may at times impact harshly on government personnel who were unaware of the shortcomings in their appointment, it is consistent with "the fundamental purpose" of civil service laws in Pennsylvania, to establish "a system whereby municipal employees would be selected on the basis of their qualifications." See Bernardi, 598 F.Supp. at 31 n. 8; McCartney v. Johnston, 326 Pa. 442, 191 A. 121, 123 (1937). Indeed, such strict adherence to civil service requirements serves as a prophylactic against the type of politically motivated personnel decisions which the plaintiff alleges as a cause of his termination. See Section C of Discussion.
Defendants assert two shortcomings in plaintiff's appointment. First, they argue that plaintiff was never subjected to the required non-competitive exam. Plaintiff has testified that he experienced an oral equivalent of the exam. He also asserts, I believe correctly, that such an exam, administered by the DCA, is an acceptable alternative to an exam conducted by the Civil Service Commission. Accordingly, plaintiff has raised a material issue of fact regarding whether he has complied with the exam requirement.
Plaintiff, however, has mounted no challenge to defendants assertion that he had not worked the required ten years on the Whitehall police force before achieving the Police Chief position. Indeed, he had never worked for Whitehall before earning the Chief job. Therefore, plaintiff's appointment was not carried out in strict compliance with the Civil Service regulation. Accordingly, plaintiff can not assert a property interest derived from those regulations for which he was entitled procedural due process.
Plaintiff also claims that a property interest was created by the discharge procedure in his employee manual. Pennsylvania law provides that an at-will employment arrangement can be altered by an implied contract such as an employee manual only if the employee can provide clear evidence that he and the employer intended to form a contract. Rutherfoord v. Presbyterian-Univ. Hosp., 417 Pa.Super. 316, 612 A.2d 500, 503 *316 (1992). A disclaimer such as that contained in the plaintiff's manual is a clear expression of the defendants' intent not to form a contract. Cf. id. 612 A.2d at 504. Therefore, plaintiff can not claim a property right derived from the manual.
2. Due Process Claim for Liberty Deprivation
Plaintiff also claims that, even in the absence of a property interest under state law, he was entitled to notice and a hearing in regards to his termination because the defendants' public announcements of plaintiff's inadequate performance, by damaging his reputation, and his opportunities for future employment, constituted a deprivation of liberty for which due process was owed.
The right invoked by the plaintiff was first established in Board of Regents v. Roth, 408 U.S. 564, 92 S.Ct. 2701, 33 L.Ed.2d 548 (1972). The Court, in ruling against a nontenured professor terminated without a hearing acknowledged that
[t]here might be cases in which a State refused to reemploy a person under such circumstances that interests in liberty would be implicated ... The State, in declining to rehire the respondent, did not make any charge against him that might seriously damage his standing and associations in his community. It did not base the nonrenewal of his contract on a charge, for example, that he had been guilty of dishonesty, or immorality. Had it done so, this would be a different case. For "(w)here a person's good name, reputation, honor, or integrity is at stake because of what the government is doing to him, notice and an opportunity to be heard are essential."
Id. at 573, 92 S.Ct. at 2707. The Court continued by clarifying that "[t]he purpose of such notice and hearing is to provide the person an opportunity to clear his name. Once a person has cleared his name at a hearing, his employer, of course, may remain free to deny him future employment for other reasons." Id. at 573 n. 12, 92 S.Ct. at 2707 n. 12.
The parameters of this due process right were circumscribed in Paul v. Davis, 424 U.S. 693, 96 S.Ct. 1155, 47 L.Ed.2d 405 (1976) and Siegert v. Gilley, 500 U.S. 226, 111 S.Ct. 1789, 114 L.Ed.2d 277 (1991). However, in Siegert, while the Court made clear that defamation by itself is not a constitutional deprivation, it confirmed the viability of Roth for a plaintiff who claimed a violation of a liberty interest because of damage to reputation in the context of a discharge or failure to rehire. Siegert, at 233-34, 111 S.Ct. at 1794; see also Albrechta v. Borough of White Haven, 810 F.Supp. 139, 145-46 (M.D.Pa. 1992). A claim for a liberty violation under Roth may be maintained without having a corresponding property interest in the job. Habe v. Fort Cherry Sch. Dist., 786 F.Supp. 1216, 1218 (W.D.Pa.1992).
According to the facts as viewed most favorable to the plaintiff, his termination was accompanied by public statements by the defendants which stigmatized him in future efforts to attain employment. Plaintiff did not achieve full-time employment until April 5, 1993, more than a year after his termination. His current position is as a patrolman in Northampton, Pa., a position inferior to that he held in Whitehall Township. This evidence is sufficient to raise a material issue of fact regarding whether plaintiff's liberty interest in not having future employment opportunities impaired by defamatory charges issued during the course of termination was violated. Cf. Habe at 1218-19 (school superintendent's alleged statement in terminating substitute cook that her work record was "no good" was sufficient evidence to resist summary judgment on liberty violation claim); see also Huntley v. Community Sch. Bd. of Brooklyn, 543 F.2d 979, 984-86 (2d Cir.1976), cert. denied, 430 U.S. 929, 97 S.Ct. 1547, 51 L.Ed.2d 773 (1977).
C. First Amendment Claim
Plaintiff asserts that he was terminated for his political affiliation, in favor of a political ally of defendant Buchmiller, thus violating his First Amendment rights of speech and association. The right not to terminated for political affiliation has been recognized by the Supreme Court. Branti v. Finkel, 445 U.S. 507, 100 S.Ct. 1287, 63 L.Ed.2d 574 *317 (1980); Elrod v. Burns, 427 U.S. 347, 96 S.Ct. 2673, 49 L.Ed.2d 547 (1976).
Contrary to defendants' contention in its motion for summary judgment, the fact that the plaintiff was not politically active, and that in fact the defendants' may not have known of plaintiff's political affiliation, is not dispositive of plaintiff's First Amendment claim. The Third Circuit has explicitly rejected the argument that Elrod and Branti should not be extended to demotions or terminations carried out to make room for political supporters, because "[a] citizen's right not to support a candidate is every bit as protected as his right to support one." Bennis v. Gable, 823 F.2d 723, 731 (3d Cir.1987).
Since plaintiff's circumstances fall within the type protected under the First Amendment, I next turn to his burden of proof. Plaintiff must prove that political affiliation was a "substantial and motivating factor" in his termination, but he need not prove that it was the sole factor motivating his dismissal. See Bennis, 823 F.2d at 732; Mitman v. Glascott, 557 F.Supp. 429, 430-32 (E.D.Pa.1983), aff'd 732 F.2d 146 (3d Cir. 1984) (both adopting standard from Mount Healthy Sch. Dist. v. Doyle, 429 U.S. 274, 97 S.Ct. 568, 50 L.Ed.2d 471 (1977)).
Plaintiff has submitted evidence that defendant Buchmiller attempted to replace him with a political crony, Michael Sefcik. Three township commissioners, two of whom worked on Buchmiller's campaign, testified that Buchmiller talked throughout her campaign about replacing Conjour with Sefcik, a friend of Buchmiller's who participated, along with his wife, in Buchmiller's campaign. Bundy Dep. at 104, 106-10; Snyder Dep. at 144, 146, 154; Solt Dep. at 9-10, 28. Two of the commissioners testified that they perceived the replacement of Conjour with Sefcik as a political favor to Sefcik. Snyder Dep. at 147; Solt Dep. at 28. According to Commissioner Solt, Sefcik was among the least qualified policeman in the township for the police chief role. Solt Dep. at 9-10.
Under the Mt. Healthy analysis, once the plaintiff has proved, or on summary judgment shown that there is a material issue of fact, that protected activity was a substantial or motivating factor in the employment decision, the burden switches to the defendant to prove by a preponderance of the evidence that "it would have reached the same decision as to [plaintiff's employment status] even in the absence of the protected conduct. Mt. Healthy Sch. Dist., 429 U.S. at 287, 97 S.Ct. at 576.
The defendants can point to two alternative reasons that plaintiff was terminated. First, when plaintiff was terminated, his letter of termination attributed to him inadequate fulfillment of his duties, and unfair treatment of subordinates. Conj.Decl., Exh. 4. In addition, defendants now assert that plaintiff was terminated primarily because his appointment did not comply with civil service requirements. See Brief in Support of Summary Judgment; Buchmiller Dep. at 40-41.
I find that the there is a material issue of fact regarding whether plaintiff would have been terminated absent the political/First Amendment considerations. The plaintiff has introduced evidence contradicting defendants' assertion that his performance was substandard. See Conj.Dep. at 32; Conj. Decl., ¶ 5 & Exhs. 4-5. Furthermore, plaintiff has introduced substantial evidence that the man whom Township Executive Buchmiller attempted to replace plaintiff with and whom plaintiff alleges was chosen based on political affiliation, Michael Sefcik, was unqualified for the position, both in terms of experience, and performance. See Solt Dep. at 5-6, 9-13, 24; see also Buchmiller Dep. at 71-74.
Defendants now assert that plaintiff was fired because of civil service irregularities. The fact that defendants have proved that plaintiff indeed was not hired in compliance with civil service regulations, while sufficient to justify summary judgment on the due process claim, does not by itself prove by a preponderance of the evidence that such non-compliance was why plaintiff was terminated. Indeed, defendants did not announce the civil service problems as a reason for the termination at the time it happened. This was so despite the fact that the civil service commission had been aware of the possibilities of civil service irregularities since 1986. Finally, *318 plaintiff has introduced evidence that defendant Buchmiller put pressure on the Commission before Sefcik's civil service examination, and, following his failure, motivated the disbanding of the Commission. This last action, if true, reveals civil service considerations as possibly a mere pretext for other motivations. Accordingly, I find that, at the summary judgment stage, defendant has not met its burden under Mt. Healthy in proving that plaintiff would have been terminated absent the consideration of political affiliation.
Defendant also raises, in its reply brief in support of summary judgment, the affirmative defense that plaintiff was in a policy making position for which political affiliation was an appropriate consideration for employment decisions. The Supreme Court has held that party affiliation may be an acceptable requirement "if an employee's private political beliefs would interfere with the discharge of his public duties." See Branti v. Finkel, 445 U.S. 507, 517, 100 S.Ct. 1287, 1294, 63 L.Ed.2d 574 (1980); Elrod v. Burns, 427 U.S. 347, 367-68, 96 S.Ct. 2673, 2686-87, 49 L.Ed.2d 547 (1976).
Because the introduction of political affiliation as an employment factor is a significant encroachment on First Amendment activity and belief, the defendant must demonstrate an "overriding interest" in order to justify its use. See Zold v. Township of Mantua, 935 F.2d 633, 635 (3d Cir.1991); Elrod, 427 U.S. at 368, 96 S.Ct. at 2687. The Third Circuit has delineated the proper inquiry as
not whether the label "policymaker" or "confidential" fits a particular position; rather, the question is whether the hiring authority can demonstrate that party affiliation is an appropriate requirement for the effective performance of the public office involved.... [S]hould a difference in party affiliation be highly likely to cause an official to be ineffective in carrying out the duties and responsibilities of the office, dismissals for that reason would not offend the First Amendment.
Zold, 935 F.2d at 635 (citations omitted).
My determination of whether political affiliation was an appropriate consideration for the termination of the plaintiff is necessarily fact specific, id., as two cases cited by defendants illustrate. In Whited v. Fields, 581 F.Supp. 1444 (W.D.Va.1984), the District Court's holding that a newly elected county sheriff in Virginia could constitutionally replace his deputies on the basis that they had opposed his election was specifically predicated on the court's finding that in Virginia a sheriff is civilly and criminally liable for the acts of his deputies, and that, in fact, under the law the sheriff and deputy are considered "one person." Id. at 1455. In Mele v. Fahy, 579 F.Supp. 1576 (D.N.J.1984), the police director terminated by the township mayor occupied a position which by contract made him "solely responsible to the Mayor," id. at 1577. Furthermore, his termination by the new mayor occurred in tandem with the abolishing of the police director position, with its corresponding duties assumed by the current police chief, rather than to create an opening for a political patron of the new mayor. Id. at 1578. Other cases have held that a law enforcement position, absent other evidence of the need for political affiliation, is not necessarily subject to patronage dismissals. See e.g. Elrod, 427 U.S. at 347, 96 S.Ct. at 2673; Barrett v. Thomas, 649 F.2d 1193, 1199-1201 (5th Cir.1981).
In this instance, defendant has submitted as exhibits several job descriptions which delegate to plaintiff substantial discretion and policymaking authority. See Conj.Decl., Exh. 1. While this evidence is certainly relevant to the role of political affiliation, Elrod, 427 U.S. at 367-68, 96 S.Ct. at 2686-87, it does not by itself fulfill defendants' significant burden in overriding plaintiff's First Amendment interests.
The only other evidence introduced by defendant on this issue, an affidavit of John D. Myers, a former assistant township executive, confirms what was already clear from the job descriptions, the police chief had policy making authority but goes no further in proving that political allegiance to the Township Executive was a necessary element of the position. See Defendants' Reply Brief, Exh. 2.
Furthermore, the very civil service considerations which the defendants rely on in *319 resisting plaintiff's due process claim, see Section A of Discussion, contradict defendants' assertion that the police chief position is one properly tied to political allegiances. The Township's decision to attach civil service protection to the position, despite its failure to adhere to them when the plaintiff was first hired, indicates an intention to minimize the importance of political allegiance. Accordingly, I find that a material issue of fact remains for trial on the issue regarding whether there was an overriding interest in the defendants making political affiliation a qualification for the police chief position which overcomes plaintiff's right to freedom of speech and association, and I will deny summary judgment on this issue.
D. Age Discrimination Claim
Plaintiff has also brought a claim under the Age Discrimination in Employment Act, based on the Township's attempt to replace him, at 48 years of age, with Michael Sefcik, who was 43 years old.
Age discrimination claims which are not supported by direct evidence, are evaluated under the burden shifting test spelled out in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973); Texas Dep't of Community Affairs v. Burdine, 450 U.S. 248, 101 S.Ct. 1089, 67 L.Ed.2d 207 (1981); and St. Mary's Honor Ctr. v. Hicks, ___ U.S. ___, 113 S.Ct. 2742, 125 L.Ed.2d 407 (1993). Plaintiff must first meet a prima facie case by showing that he was: (i) within the protected class (over 40 years of age); (ii) was qualified for the position he held; (iii) was dismissed despite being qualified; and (iv) was replaced by a younger person. Gray v. York Newspapers, Inc., 957 F.2d 1070, 1078 (3d Cir.1992). If the plaintiff meets this requirement the burden switches to the defendants to articulate a legitimate, non-discriminatory reason for the employment decision. Burdine, 450 U.S. at 253-54, 101 S.Ct. at 1093-94. Plaintiff then has the opportunity to establish that the stated reason or reasons for the termination are a pretext for discrimination. St. Mary's Honor Ctr., ___ U.S. at ___, 113 S.Ct. at 2749.
Even if plaintiff proves that the reasons proffered for the termination are pretextual, he still maintains the ultimate burden of proving that the termination was motivated by discriminatory intent. Hicks, ___ U.S. at ___, 113 S.Ct. at 2749. While it is permissible for the district judge to infer discriminatory intent from the facts of the prima facie case and the plaintiff's refutation of the defendant's explanation, that inference is not compelled. Id. ___ U.S. at ___ - ___ at 2747-48.
In this instance, plaintiff arguably fails to make out the prima facie case. While the fact that the plaintiff's intended replacement was himself over forty years old and only five years younger than the plaintiff does not rule out an age discrimination claim, it certainly weighs less in plaintiff's favor than a greater age discrepancy. Bruno v. W.B. Saunders Co., 882 F.2d 760, 764-65 (3d Cir.1989); Maxfield v. Sinclair Int'l, 766 F.2d 788, 793 (3d Cir.1985), cert. denied 474 U.S. 1057, 106 S.Ct. 796, 88 L.Ed.2d 773 (1986). However, even if plaintiff is conceded the prima facie case, and even if I would ultimately decide that the reasons for the termination offered by the defendants quality of work, and the civil service irregularities are pretextual, plaintiff still falls too far short of his ultimate burden of proving that his termination was motivated by a discriminatory intent regarding his age to allow him to proceed with this claim to trial.
The only evidence which plaintiff offers to show that his termination was age motivated is the very slight difference in age between himself and Sefcik. While this difference is arguably enough to make out a prima facie case, by itself it carries almost no weight in showing an improper intent on the part of the defendants. See Maxfield, 766 F.2d at 793.
Plaintiffs bringing discrimination claims may also point to the falsity of the defendants' proffered reasons for termination as evidence of discrimination. Hicks, ___ U.S. at ___ - ___, 113 S.Ct. at 2747-48. However, in this case, even were I to find pretext, the false reasons are as likely to have been offered as an alternative to admitting an improper politically motivated termination, *320 as an excuse for an age motivated termination. As the Supreme Court observed in Hicks, the defendants' proffered reason cannot be proved to be a "`pretext for discrimination' unless it is shown both that the reason was false, and that discrimination was the real reason." Id. ___ U.S. at ___, 113 S.Ct. at 2752 (emphasis in original). Given the facts of this case there is no justification for treating pretextual reasons offered by the defendants as evidence of an attempt to justify discrimination which was actually based on age. Therefore, I find that plaintiff has not offered more than a scintilla of evidence in response to defendants' summary judgment motion on this issue, and I will grant summary judgment on this issue.
Therefore, IT IS ORDERED that:
1. The motion for summary judgment on plaintiff's procedural due process claim based on deprivation of a property interest is GRANTED, and the claim is dismissed.
2. The motion for summary judgment on plaintiff's procedural due process claim based on deprivation of a liberty interest is DENIED.
3. The motion for summary judgment on plaintiff's First Amendment claim is DENIED.
4. The motion for summary judgment on plaintiff's ADEA claim is GRANTED, and the claim is dismissed.
NOTES
[1] Defendants argue that these regulations have not been properly authenticated, and therefore can not be treated as evidence in deciding this summary judgment motion. Defendants are correct that documents relied on to decide summary judgment motions are subject to the Federal Rules of Evidence. See Cook v. Babbitt, 819 F.Supp. 1, 25 (D.D.C.1993). However, local ordinances and regulations are official publications which are self-authenticating under Federal Rule 902(5). See Ogden Envtl. Servs. v. City of San Diego, 687 F.Supp. 1436, 1437 (S.D.Cal.1988). The regulations are therefore properly before me.
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F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
MAY 27 2004
FOR THE TENTH CIRCUIT
PATRICK FISHER
Clerk
DONALD E. ARMSTRONG,
Plaintiff-Appellant,
v. No. 03-4208
(D.C. No. 2:03-CV-212-TC)
STEVEN R. BAILEY, Trustee of the (D. Utah)
Willow Brook Cottages, L.L.C.
Bankruptcy Estate and individually;
DUANE H. GILLMAN, individually
and as counsel for Steven R. Bailey,
Defendants-Appellees.
ORDER AND JUDGMENT *
Before McCONNELL, ANDERSON, and BALDOCK, Circuit Judges.
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument.
*
This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
Appellant Donald E. Armstrong appeals two orders of the district court, one
dismissing his appeal for failure to timely file an opening brief, and one denying
his motion to recuse. We affirm.
Matters regarding extensions of time in which to file briefs are left to the
discretion of the relevant court. Nielsen v. Price, 17 F.3d 1276, 1277 (10th Cir.
1994) (finding no abuse of discretion in dismissing bankruptcy appeal because of
untimely filed brief); cf. Panis v. Mission Hills Bank, N.A., 60 F.3d 1486, 1494
(10th Cir. 1995) (finding no abuse of discretion in permitting late filing under
Federal Rules of Civil Procedure). Given the fact that Armstrong had already
received an extension of thirty days in which to file his opening brief, we
perceive no abuse of discretion in refusing to grant further extensions. The fact
that this court has, on occasion, allowed late filings by Armstrong and perhaps
others has no relevance in this matter. The district court was fully within its
authority to manage its own docket. See Span-Eng Assocs. v. Weidner, 771 F.2d
464, 470 (10th Cir. 1985).
Next, Armstrong argues that the judge should have recused. Because the
judge documented her decision not to recuse, we review this matter for abuse of
discretion. Lopez v. Behles (In re Am. Ready Mix, Inc.), 14 F.3d 1497, 1500 (10th
Cir. 1994); Sac & Fox Nation v. Cuomo, 193 F.3d 1162, 1168 (10th Cir. 1999).
-2-
When the impartiality of a judge may be reasonably questioned in any
proceeding, recusal is required. 28 U.S.C. § 455(a). Armstrong argues that no
reasonable person could do anything but question the impartiality of the judge.
To support this contention, however, Armstrong points to nothing but conclusory
statements and the fact that the judge has previously ruled against him. This is
insufficient to establish grounds for recusal under § 455(a).
Previous adverse rulings are almost never a basis for recusal. Liteky v.
United States, 510 U.S. 540, 555 (1994). The most common basis for recusal is
when a judge learns something outside of the proceedings before her which
“result[s] in an opinion on the merits on some basis other than what the judge
learned from [her] participation in the case.” See In re Am. Ready Mix, 14 F.3d
at 1501; see also Liteky, 510 U.S. at 551 (noting that extrajudicial source factor is
the only common basis upon which to establish disqualifying bias). Armstrong
does not contend that there is any extrajudicial source at work here that has
prejudiced the judge. He appears to argue, instead, that this is one of those rare
cases where the alleged bias or prejudice “springs from the facts adduced or the
events occurring at trial, [and] is so extreme as to display clear inability to render
fair judgment.” Id. We have thoroughly examined the record in this case and
disagree.
-3-
In connection with his recusal arguments, Armstrong continues to complain
that no court has addressed what he considers the “excessive penalties in the
Modified Judgment [that] are unconstitutionally excessive.” See Aplt. Br. at 17.
We assume Armstrong is referring to the judgment of the Texas state court in
1997. There is no court within the Tenth Circuit with jurisdiction to review any
part of that judgment, and the refusal of courts within this Circuit to do so is not
evidence of bias toward Armstrong or an effort to deny him access to the courts.
Armstrong’s motion to supplement the record is DENIED. The judgment of
the district court is AFFIRMED. The mandate shall issue forthwith.
Entered for the Court
Bobby R. Baldock
Circuit Judge
-4-
| {
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In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 03-2429
DESIGNER DIRECT, INCORPORATED, doing
business as LEVIN ASSOCIATES ARCHITECTS,
Plaintiff-Appellee,
v.
DEFOREST REDEVELOPMENT AUTHORITY,
Defendant-Counter Plaintiff-Appellant,
v.
KERRY LEVIN,
Counter Defendant-Appellee.
____________
Appeal from the United States District Court
for the Western District of Wisconsin.
No. 01 C 40—John C. Shabaz, Judge.
____________
ARGUED FEBRUARY 20, 2004—DECIDED MAY 14, 2004
____________
Before FLAUM, Chief Judge, and BAUER and MANION,
Circuit Judges.
BAUER, Circuit Judge. The facts of this controversy,
based on diversity jurisdiction, were recited in our earlier
opinion, Designer Direct, Inc. v. Deforest Redevelopment
2 No. 03-2429
Authority, 313 F.3d 1036 (7th Cir. 2002), and so only those
facts relevant to the issue at hand will be discussed here. In
that opinion we reversed the trial court’s refusal to award
reliance damages to Plaintiff. Id. at 1047-50. On remand,
the trial court calculated reliance damages by using the
hourly rates agreed to in the Phase I contract—based on an
arm’s-length negotiation. That rate was then multiplied by
the number of hours Plaintiff invested in Phase III of the
redevelopment contract—the phase at issue here. Finally,
the judge reduced the calculated figure by ten percent to
account for the profits and “inevitable unrecoverable time”
due to Plaintiff’s employee’s mistakes and the like. The
award amounted to $444,927. Defendant, Deforest Redevel-
opment Authority (DRA), appealed.
Under applicable Wisconsin law, damages are a finding of
fact. Kolbe & Kolbe, Millwork Co., 476 N.W.2d 305 (Wis. Ct.
App. 1991). Therefore, we review the determination of
damages for clear error. Designer Direct, 313 F.3d at 1047-
48 (citing CSC Holdings, Inc. v. Redisi, 309 F.3d 988, 994-
95 (7th Cir. 2002)).
“Remedies for injury to a reliance interest are defined as
‘being reimbursed for loss caused by reliance on the contract
by being put in as good a position as [the plaintiff] would
have been in had the contract not been made.’ ” Reimer v.
Badger Wholesale Co., 433 N.W.2d 592, 594 (Wis. Ct. App.
1998) (quoting RESTATEMENT (SECOND) OF CONTRACTS § 344
(1981)). Such damages are usually construed to include out-
of-pocket expenditures incurred in preparation or perfor-
mance of the contract. RESTATEMENT (SECOND) OF CON-
TRACTS § 349 (1981). A plaintiff may also seek reliance
damages under a theory of lost opportunity. RESTATEMENT
(SECOND) OF CONTRACTS § 344 cmt. a. (1981). Damages
must be proven with reasonable certainty. Pleasure Time,
Inc. v. Kuss, 254 N.W.2d 463, 470 (Wis. 1977).
First, it should be noted that Plaintiff did not prove the
existence of a lost opportunity. While Designer Direct did
No. 03-2429 3
show that there was some interest from other potential
clients, it failed to name them or show that it was likely
that a contract would have been entered into but for
Designer Direct’s contract with the DRA. Therefore,
recoverable damages are limited to those losses actually
caused by Plaintiff’s reliance on the Phase III redevelop-
ment plan.
Defendant argues that the reliance damages awarded to
Plaintiff cannot be sustained. Its main complaint, beyond
the argument that Plaintiff did not prove lost opportunity,
is that Plaintiff did not show actual out-of-pocket expenses.
While the argument has some merit, it misses the mark.
Plaintiff rightly contends that there is more than one way
to skin a cat. It argues that adding up all of the expenses
paid in reliance upon the Phase III redevelopment plan
should produce the same figure as subtracting the profits
from the hourly-pay-rate-figure. Unfortunately, that
method of calculation, at least upon the facts of this case,
fails to satisfy the requirement of reasonable certainty of
damages.
Under Autotrol Corp. v. Continental Water Sys. Corp., 918
F.2d 689, 692-94 (7th Cir. 1990), overhead expenses are
recoverable as reliance damages. This is true provided that
the plaintiff seeking to recover can show that those ex-
penses were properly allocated to the breached contract,
Cyberchron Corp. v. Calldata Sys. Development, Inc., 47
F.3d 39, 46 (2d Cir. 1995), and that they would have prob-
ably obtained those overhead expenses on other projects,
Autotrol Corp., 918 F.2d at 693. Plaintiff failed to satisfy
the former.
While it appears as though most of the work being per-
formed by Plaintiff was directly related to the redevelop-
ment project, other work was being done in both the
Wisconsin field office and the main office in Des Plaines,
Illinois. Plaintiff cannot recover that portion of overhead
4 No. 03-2429
costs which is attributable to those other projects. To clar-
ify, let us say, hypothetically, that an employee of Designer
Direct spent 80% of his working hours on the redevelop-
ment project. That would mean that 20% of his salary and
benefits is not recoverable as damages. In other words, we
simply do not know what percentage of the overall working
hours were spent on Phase III of the DRA project and what
percentage of time was spent on other projects. Without
such information, we cannot determine the percentage of
benefits, and other overhead expenses that should be
allocated to the breached contract. Allowing Designer Direct
to recover those overhead expenses not allocated to the
breached contract would result in a windfall for Plaintiff.
We refuse to announce a rule forbidding Plaintiff’s
method of calculating damages. However, we suspect that
plaintiffs seeking to use such a method will find themselves
in the same quagmire as Plaintiff in this case. The fact is
that Plaintiff’s calculation is an estimated guess. While we
believe that the properly calculated damages figure will be
close to the figure previously announced, we do not
know—and therein lies the problem.
We remand with instructions to recalculate the damages.
We invite Plaintiff to supplement the record with concrete
evidence of expenditures and the percentage of overhead
costs which can be attributed to the Phase III redevelop-
ment plan. As Judge Shabaz has already found that “[i]t is
entirely reasonable to infer that had Plaintiff not invested
its efforts in this project it would have gainfully applied the
hours to another,” the inquiry on remand should focus on
determining those expenses which may be properly al-
located to the breached contract.
REVERSED AND REMANDED WITH DIRECTIONS
No. 03-2429 5
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—5-14-04
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50 Wn.2d 237 (1957)
310 P.2d 532
WILLIAM H. HARKINS, Respondent,
v.
FRANK DEL POZZI et al., Appellants.[1]
No. 34061.
The Supreme Court of Washington, Department One.
May 2, 1957.
Ostrander, Van Eaton & Hepfer, for appellants.
Leo W. Stewart, for respondent.
OTT, J.
This is an action to quiet title. It presents but a single primary question: Where is the proper boundary line between second-class tidelands owned by one person and the adjacent uplands owned by another?
The cause was tried to the court. It determined the line of ordinary high tide as of the year 1910, and that it was relatively unchanged at the present time; that there was insufficient substantial or reliable evidence to establish the line of ordinary high tide to have been further landward at any earlier date; and that the owner of the second-class tidelands had acquired title to the disputed upland area between the line of ordinary high tide and the meander line by adverse possession.
From a judgment quieting title to the disputed uplands in the owner of the second-class tidelands, the owners of the adjacent uplands have appealed.
The appellants' title was acquired through predecessors in interest and originated with a patent issued by the United States government in 1873. Some of the intervening deeds of conveyance and a county tax foreclosure were defective *239 in various respects and, in 1949, the appellants Del Pozzi (alleging, inter alia, adverse possession) brought an action to quiet title to real property described as follows:
"Beginning at the meander corner to Sections 15 and 22 Township 29 North, Range 2 East of the Willamette Meridian, with a variation of 23° 30' East; thence North 9° East 20.25 feet to the true place of beginning; thence North 89° East 472.13 feet; thence North 32° 5' East 218.5 feet; thence North 67° 38' West 90 feet; thence North 19° 5' East 153 feet; thence North 43° 25' West 173.4 feet; thence North 42° 9' West 303.94 feet; thence North 46° 37' West 148.1 feet; thence North 32° 55' West 240 feet; thence North 29° 29' West 320 feet; thence West 177 feet; thence on the meander line South 32° East 455 feet; thence South 16° East 544.5 feet; thence South 9° West 395.55 feet to the true place of beginning, EXCEPT a strip 70 feet wide off of the North end, from county road to meander line."
The decree, entered May 17, 1949, quieted title in appellants Del Pozzi as against all persons specifically made parties to the proceedings and their unknown heirs, and all other persons claiming any right, title or interest in the real estate described therein. The respondent was not made a party to this proceeding.
The respondent's title to the second-class tidelands originated in 1930 by a deed to his predecessor from the state of Washington, which conveyance contained the following description:
"All tide lands of the second class, owned by the State of Washington, situate in front of, adjacent to or abutting upon the north half in width of lot 3, except the north 70 feet of said lot, section 15, township 29 north, range 2 east, W.M., with a frontage of 9.97 lineal chains, more or less."
The appellants claim ownership beyond the meander line and to the line of ordinary high tide, for the reason that the line of ordinary high tide is most seaward, and that, hence, the meander line is not the true seaward boundary of the uplands. Rue v. Oregon & Washington R. Co., 109 Wash. 436, 186 Pac. 1074 (1920); Harper v. Holston, 119 Wash. 436, 205 Pac. 1062 (1922); Harris v. Swart Mortgage Co., 41 Wn. (2d) 354, 249 P. (2d) 403 (1952).
*240 In approaching this problem, we must first determine where the evidence established the mean or ordinary high tide line was located. With reference to the location of the line of ordinary high tide, the court entered the following finding of fact:
"That the line of ordinary high water, salt water, or line of mean high tide as the same ebbed and flowed in Mutiny Bay in North Half of Government Lot 3, in Section 15, Township 29 North, Range 2, E.W.M. Island County, Washington, at the time of statehood and until 1910 is impossible to determine in relation to the sandspit that is located some distance westerly of the United States Government Adjusted Meander Line as hereinabove described, but from 1910 until 1934, and again from 1934 until 1956, the mean high tide line in North Half of Government Lot 3, was located along the westerly boundary of the sandspit, as more particularly shown in Defendant's Exhibit 35."
[1, 2] No error is assigned to this finding and, hence, for the purposes of this action, the line of ordinary high tide is as established by exhibit No. 35. Judd v. Bernard, 49 Wn. (2d) 619, 304 P. (2d) 1046 (1956). The line of ordinary high tide is that line which the water impresses on the soil by covering it for sufficient periods to deprive the soil of vegetation and destroy its value for agricultural purposes. Driesbach v. Lynch, 71 Idaho 501, 234 P. (2d) 446 (1951).
RCW 79.04.060 [cf. Rem. Rev. Stat., § 7797-6] defines second-class tidelands as follows:
"Whenever used in this title the term `second class tidelands' means public lands belonging to the state over which the tide ebbs and flows outside of and more than two miles from the corporate limits of any city, from the line of ordinary high tide to the line of extreme low tide."
[3] At the time of statehood, the state of Washington acquired from the Federal government the ownership of the beds and shores of all navigable waters in the state, up to and including the line of ordinary high tide in waters where the tide ebbs and flows. Art. XVII, § 1, state constitution.
The conveyance from the state of Washington of *241 second-class tidelands adjacent to government lot 3 to respondent's predecessor conveyed only the title which the state had, namely, to the line of ordinary high tide. Hence, in order for respondent in this case to assert any interest in the uplands in question, he must rely upon his claim of adverse possession.
The court determined that adverse possession had been established under RCW 7.28.050, 7.28.070, 7.28.080 [cf. Rem. Rev. Stat., §§ 786, 788, 789]. In this particular, the court found:
"And the plaintiff [respondent] and his predecessors in interest have been in actual, open and notorious possession of all of said land as herein described under claim and color of title made in good faith, and for more than seven successive years remained in possession, and have a connected title in law and equity deducible of record from the State of Washington, and has paid all taxes legally assessed against said lands by the County Assessor and plaintiff is now the legal owner and entitled to immediate possession thereof, and have the easterly boundary of his land established as the United States Government Adjusted Meander line as set forth in paragraph 1 hereof."
[4] The appellants contend that this finding was not supported by the evidence. We are in accord with appellants' contention. The trial court, in its memorandum opinion, discussed the evidence relating to adverse possession, upon which this finding was based. The court was of the opinion that, although the respondent's tidelands deed of 1930 conveyed no record title to any of the uplands west of the line of ordinary high water, it did convey a paper title to such uplands as far east as the government adjusted meander line.
By statute, the measurement of the length of second-class tidelands is in lineal chains along the meander line. RCW 79.16.330 [cf. Rem. Rev. Stat., § 7797-120]. The fact that the statute requires this measurement to be made along the meander line does not establish that line as a boundary between the second-class tidelands and the adjacent uplands. The boundary lines of second-class tidelands are, by statute, the line of extreme low tide and the line of ordinary *242 high tide. RCW 79.04.060, supra. All area landward of the line of ordinary high tide is uplands. The 1930 deed which conveyed only second-class tidelands did not give respondent paper title to the adjacent upland area. Hence, the court's finding that respondent had color of title to the disputed upland area is not supported by the evidence.
Were respondent's acts of disseizin sufficient to satisfy the statute and establish a right by adverse possession, as found by the trial court?
[5] The first act of disseizin was by respondent's predecessor, who built a boathouse and walkway on the property in 1932. This was removed in 1934. The act was one of disseizin; however, it fell far short of continuing for the period of time required by RCW 7.28.070, supra.
Second, during the years 1934 to 1949, the respondent and his predecessor used the area for occasional picnics. We have held that such use is not such an adverse use as to evidence a hostile claim, nor was it sufficiently continuous in this case to establish a right. See Smith v. Chambers, 112 Wash. 600, 192 Pac. 891 (1920); Bowden-Gazzam Co. v. Kent, 22 Wn. (2d) 41, 154 P. (2d) 292 (1944).
Third, the evidence established that respondent and his predecessor posted a sign on this area warning of the danger of beach fires. Although permission to erect the sign was not sought, the sign contained nothing to indicate that it was placed there by the owner of the second-class tidelands, or that respondent was asserting dominion over the area where the sign was located.
The acts of disseizin, as evidenced by the record, were insufficient to satisfy the statute relative to adverse possession.
Does the evidence sustain the finding that the owner of the tidelands was paying taxes on the uplands?
[6] The respondent's tax receipts described "Tidelands in front of lot 3." Such a statement in the tax receipts indicates that the assessment was upon tidelands only, and that the tax based upon the assessment was paid upon such lands. Nor does the testimony of the assessor indicate that, in making his assessment of the value of the second-class *243 tidelands, he included this upland area between the line of ordinary high tide and the meander line. Hence, the evidence does not sustain the court's finding that respondent paid taxes upon these uplands. We conclude that the respondent did not sustain his claim of title to the uplands by adverse possession.
Was there sufficient evidence to sustain appellants' cross-complaint that title be quieted in them as against the respondent?
[7] The appellants' chain of title up to Anderson described the seaward boundary line as the meander line. Such a description is sufficient to include the disputed upland area. The meander line, when located landward of the line of ordinary high tide, has been held not to be the true boundary line. In such cases, the true boundary line is the line of ordinary high tide. Rue v. Oregon & Washington R. Co., supra; Harper v. Holston, supra; Harris v. Swart Mortgage Co., supra.
Anderson was not divested of title to the north half of government lot 3 by the tax foreclosure of 1902. He or his heirs were divested of the north half of government lot 3 only as far seaward as the meander line by the quiet-title action of 1949, for the reason that the quiet-title action was an action in rem, and the court could confirm no greater interest than was actually prayed for in the complaint. See State ex rel. First Nat. Bank of Central City, Colo. v. Hastings, 120 Wash. 283, 207 Pac. 23 (1922), and State ex rel. Adams v. Superior Court, 36 Wn. (2d) 868, 220 P. (2d) 1081 (1950).
Commencing with the Marshall deed to Beaughan in 1908, and from Beaughan to Lambier in 1912, and from Lambier to Robinson in 1919, and from Robinson to Del Pozzi in 1931, and from Del Pozzi by contract to Thelen in 1949, the description contained in the deeds included the north half of government lot 3 to the meander line. Those deeds, although they described property which was not included in the county tax foreclosure of 1902, nevertheless conferred a paper title to the uplands to the line of ordinary high tide, for the reason that an invalid deed will *244 support color of title. Hamilton v. Witner, 50 Wash. 689, 97 Pac. 1084 (1908); Lara v. Sandell, 52 Wash. 53, 100 Pac. 166 (1909); Schlossmacher v. Beacon Place Co., 52 Wash. 588, 100 Pac. 1013 (1909); Miller & Sons v. Simmons, 67 Wash. 294, 121 Pac. 462 (1912).
[8] Hence, Del Pozzi and Thelen have paper title to the uplands to the line of ordinary high tide, by virtue of recorded deeds extending back for approximately fifty years. As between the appellants and the respondent, the appellants have color of title to the disputed area by virtue of their ownership of the uplands, while the respondent has no color of title to any lands other than the second-class tidelands.
Further, the tax receipts of the appellants show that they paid the taxes on the uplands of the north half of government lot 3, while the respondent's heretofore-discussed tax receipts show that he paid taxes on the tidelands, but none on uplands.
This proceeding being one in rem, in which the ownership of the uplands in question is specifically put in issue as between the parties to this action, only the rights of the parties to this proceeding can be determined. The title can be quieted only as to them. The appellants having color of title, their title is superior to the claim of the respondent, who has no title whatsoever except a claim of adverse possession, which claim, we hold, did not satisfy the statutes with reference to adverse possession.
[9] Finally, respondent contends that the 1949 action to quiet title was void as to him for the reason that he was not made a party defendant in that proceeding.
This contention is without merit for two reasons: (1) The disputed area was not included within the specific description in the complaint, and (2), since he was claiming title only to tidelands, he was not a necessary or proper party in an action where only the title to uplands was being adjudicated.
For the reasons stated, the judgment of the trial court is reversed. The cause is remanded with instructions to enter *245 a judgment quieting title in the appellants to the disputed upland area.
HILL, C.J., MALLERY, FINLEY, and WEAVER, JJ., concur.
June 27, 1957. Petition for rehearing denied.
NOTES
[1] Reported in 310 P. (2d) 532.
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In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 06-3855
ROBERT A. HENRY,
Plaintiff-Appellant,
v.
ARTHUR L. JONES and CITY OF MILWAUKEE,
Defendants-Appellees.
____________
Appeal from the United States District Court
for the Eastern District of Wisconsin.
No. 04 C 1082—J.P. Stadtmueller, Judge.
____________
ARGUED APRIL 9, 2007—DECIDED NOVEMBER 1, 2007
____________
Before EASTERBROOK, Chief Judge, and KANNE and
WILLIAMS, Circuit Judges.
WILLIAMS, Circuit Judge. After a local television station
aired a videotape that showed Officer Robert Henry
shoving an unarmed arrestee in a police station booking
room and then pushing him against a wall and onto a
desk, then-Milwaukee Police Chief Arthur Jones re-
quested an Internal Affairs Division investigation and
ultimately decided to terminate Henry from the Milwaukee
Police Department. Henry, a white male, maintains that
Jones, an African American, fired him because of Henry’s
race. However, because Henry has not presented sufficient
evidence that the decision to terminate him was made on
2 No. 06-3855
account of his race, we affirm the district court’s grant of
summary judgment in favor of the defendants.
I. BACKGROUND
Robert Henry filed this suit against the City of Mil-
waukee and Arthur L. Jones, the chief of police of the City
of Milwaukee from November 18, 1996 to November 18,
2003. We recount the facts that follow in the light most
favorable to Henry, the nonmovant for summary judgment.
On March 20, 2002, Milwaukee police officers Talmer
Wilson and Rodney Young, both African-American males,
arrested Billy Miles, also an African-American male. The
officers brought Miles to the police station where Henry
was working. A video camera located in the booking
room recorded the events at the heart of this suit. The
videotape contains a date and time display, but it did not
record sound.
Accompanied by an officer, Miles entered the booking
room at 2:43 a.m. and sat on a bench while Henry searched
another person. About seven minutes later, the officer
accompanied Miles to the area in front of Henry’s desk.
Miles removed his coat, and the officer briefly searched
him. Miles remained standing in the area to which he
had been brought, a few feet in front of the desk where
Henry was seated. During this time, Henry sat at his desk
completing paperwork while two other officers (presum-
ably Wilson and Young) stood nearby. Although there is
no sound on the video, it is clear that Miles spoke to the
three officers while he stood in front of Henry’s desk, and
he occasionally gestured while doing so.
At 2:54 a.m., Miles gestured towards Henry and briefly
placed his hands on Henry’s desk. This action did not
produce any reaction from the three officers, and Henry
remained seated at his desk while the other two officers
No. 06-3855 3
remained standing, one leaning on a counter. Miles took
a few steps back to where he had been standing and
continued to talk to the officers. At 2:55 a.m., Henry stood
up from his chair and walked around his desk, toward
where Miles was standing. Miles remained as he had been,
standing with his hands at his sides. He did not move
toward Henry.
While Miles’s hands were both down at his sides, Henry
suddenly pushed Miles in the collar bone area. This action
knocked Miles off balance (Henry is taller and bigger than
Miles), and he stumbled backwards. Miles regained his
balance, and, with both hands raised above his head, he
appeared to move toward Henry. At that point, Henry
grabbed Miles near his jaw and pushed him against a
wall, then onto a desk. Several persons then entered the
room, and Miles was led back to the bench in handcuffs.
After Miles had been handcuffed, Henry flexed his right
arm and patted his bicep several times while staring
at Miles. A little later, Miles spit at one of the officers.
Miles was subsequently charged with assault by a prisoner
for spitting at an officer.
On July 16, 2002, a Milwaukee television station aired
portions of the videotape from Miles’s booking. That night,
Jones telephoned Internal Affairs Division (“IAD”) Com-
mander Steven Settinsgaard and asked for an investiga-
tion into Henry’s actions. Settinsgaard watched the video
and briefed Jones on his observations. The two decided
not to take disciplinary action at that point, preferring
instead to have the persons involved interviewed.
Settinsgaard ordered an IAD investigation, and Jones
asked the Milwaukee County District Attorney’s office to
investigate Henry’s conduct.
The news segment showing the videotape did not go
unnoticed. On July 22, 2002, about a week after the
television station aired the video, members of the Wiscon-
4 No. 06-3855
sin Legislative Black and Hispanic Caucus wrote Jones
a letter stating that the Caucus would be monitoring
the police department’s response. Five days later, Jones
attended a community meeting where citizens expressed
concern that Henry had mistreated Miles.
In the meantime, Sergeant Michelle Graham oversaw
the IAD investigation, which included interviews of
Henry, Miles, Wilson, Young, and others. Graham sub-
mitted a final report on August 1, 2002. Among other
things, the report states that Henry explained that Miles
had been uncooperative and belligerent and had threat-
ened to spit at him. Henry further stated that he pro-
ceeded around the desk in an attempt to search Miles,
and that Miles had said “Come on” while hawking some-
thing from his throat, leading Henry to push Miles
against the wall to stun him and to stop his actions. In
addition to conducting numerous interviews, Graham
viewed the video before preparing her report. The report
states that although Henry said during an interview that
Miles had balled up his fist as though he would attack
Henry, the video recording did not show Miles ball up his
fist at any time before Henry pushed Miles. The report
concluded that the video showed Henry push Miles at
the base of his neck and collarbone area, causing him to
fall against a wall, and that Miles had not leaned toward
Henry, rolled his shoulders upward, or balled his hands
before Henry contacted him. The report also finds that
after Miles was restrained, Henry rolled his sleeves,
flexed his bicep, and patted his bicep in a taunting manner
while staring at Miles.
At the end of the IAD investigation, Settinsgaard
concluded that Henry had violated a department rule
regarding the treatment of prisoners by initiating
physical contact with Miles by either pushing or strik-
ing him, and then by patting his bicep afterward. He
No. 06-3855 5
also viewed the patting of the bicep as improper taunt-
ing of a prisoner.
Henry was charged with violating a Milwaukee Police
Department rule that states:
Members of the police force are strictly forbidden
to argue with prisoners, to speak to them unneces-
sarily, to address them in obscene or profane
language, or to threaten them. Members of the
police force guilty of unnecessarily striking or
manhandling a prisoner or mistreating them in
any manner shall be subject to dismissal . . . .
Rule 4, Section 2/455.00. Officers Wilson and Young were
charged with witnessing Henry’s mistreatment of Miles
and failing to report it to a supervisor, a violation of
another department rule.
Ten days later, Jones terminated Henry’s employment
(subject to appeal). He reached this decision after review-
ing the videotape of Miles’s booking, reading the IAD
report, and receiving Settinsgaard’s interpretation of the
tape. In Jones’s opinion, Henry violated a department
rule by unnecessarily manhandling and mistreating
Miles, as well as by threatening him, and he concluded
that termination was appropriate. Wilson and Young
received thirty-day suspensions without pay for wit-
nessing Henry’s conduct and failing to report it.
The next month, the District Attorney announced he
would not issue criminal charges against Henry. A Mil-
waukee Police Department report states that a Deputy
District Attorney explained that his office had the video-
tape professionally blown up and digitized. After review-
ing the tape in slow motion, frame by frame, the Deputy
District Attorney concluded that Henry had not placed
his hands around Miles’s neck but instead had his
hands around Miles’s chin, directing Miles’s face away
6 No. 06-3855
from him. The report does not state whether the conduct
it describes refers to the initial shove or to Henry’s subse-
quent hold while he led Miles onto a desk. The report also
states that the Deputy District Attorney believed that
the video showed Miles take a defensive stance with his
right fist clenched when Henry walked around the table.
Henry appealed his termination to the Board of Fire and
Police Commissioners of the City of Milwaukee, and
several persons testified on his behalf. Wilson and Young
testified that before Henry initiated contact with Miles,
they believed Miles was about to spit on Henry and that
Miles did not turn to the wall as Henry had instructed.
Other witnesses, including the author of a training
manual for a Defense and Arrest Tactics course, testified
that they had watched the video and observed nothing
improper in Henry’s behavior. Lieutenant Jay Martyka, an
instructor at the Police Academy, testified that Henry’s
bicep flex could be a form of “verbal judo,” a communica-
tion tool taught at the Academy. The only evidence that
Jones presented in support of Henry’s termination was
the videotape.
The Board found that Jones had failed to present any
testimony and had failed to present other evidence suffi-
cient to sustain the chief ’s finding that Henry mistreated,
manhandled, or threatened Miles. The Board also con-
cluded that the chief had failed to present sufficient
evidence that a fair and reasonable effort had been
made to determine whether a rule had been violated.
Henry was subsequently reinstated. Soon thereafter, Jones
issued a press release stating that he had asked the
Federal Bureau of Investigation to investigate whether
Henry’s actions violated federal civil rights statutes. The
United States Department of Justice ultimately found no
evidence of a prosecutable civil rights violation. Henry
took disability leave soon after seeing the press release
announcing that the matter had been referred to the FBI.
No. 06-3855 7
His brief states that he remains on disability with Post-
Traumatic Stress Disorder.
II. ANALYSIS
We review the district court’s grant of summary judg-
ment de novo. Perez v. Illinois, 488 F.3d 773, 776 (7th Cir.
2007). Summary judgment is proper when “the pleadings,
depositions, answers to interrogatories, and admissions
on file, together with the affidavits, if any, show that
there is no genuine issue as to any material fact and that
the moving party is entitled to a judgment as a matter of
law.” Fed. R. Civ. P. 56(c). We draw all reasonable infer-
ences from the evidence in the light most favorable to the
non-moving party. Perez, 488 F.3d at 776.
Robert Henry contends that he was terminated from
his position as an officer with the Milwaukee Police
Department because he is white. Title VII prohibits
employers from discriminating against employees on the
basis of race, 42 U.S.C. § 2000e-2(a)(1), and it is well-
settled that the protections of Title VII “are not limited to
members of historically discriminated-against groups.”
Ballance v. City of Springfield, 424 F.3d 614, 617 (7th Cir.
2005). As in any Title VII case, Henry may proceed under
either the “direct” or “indirect” methods of proving dis-
crimination. See id.
A. Indirect Method
We turn first to Henry’s argument that he presented a
prima facie case of discrimination under the indirect,
burden-shifting method initially set forth in McDonnell
Douglas Corp. v. Green, 411 U.S. 792 (1973). To establish
a prima facie case of racial discrimination in a reverse dis-
crimination suit such as this one, the plaintiff bears the
8 No. 06-3855
burden of establishing: (1) “ ‘background circumstances’
that demonstrate that a particular employer has ‘reason or
inclination to discriminate invidiously against whites’ or
evidence that ‘there is something “fishy” about the facts at
hand’ ”; (2) he was performing his job up to his employer’s
legitimate expectations; (3) he suffered an adverse employ-
ment action; and (4) he was treated less favorably than
similarly-situated individuals who are not members of the
protected class. Phelan v. City of Chicago, 347 F.3d 679,
684-85 (7th Cir. 2003) (quoting Mills v. Health Care
Service Corp., 171 F.3d 450, 457 (7th Cir. 1999)) (quoting
Harding v. Gray, 9 F.3d 150, 153 (D.C. Cir. 1993)). Sum-
mary judgment in the defendant’s favor is proper if a
plaintiff fails to set forth a prima facie case. See Burks v.
Wisc. Dep’t of Transp., 464 F.3d 744, 751 (7th Cir. 2006).
If the plaintiff satisfies his initial burden, the burden
shifts to the defendant to present a legitimate, non-
discriminatory reason for the decision. Id. If the defendant
does so, the burden returns to the plaintiff to show that
the defendant’s explanation was pretextual. Id.
The district court concluded that summary judgment
was proper because Henry had not demonstrated that
he was treated less favorably than similarly-situated
employees who are not white, and it is with that conclusion
that we begin. Concerned with overly rigid treatment of
the indirect method’s fourth prong, we have explained that
“similarly situated” means only that members of the
comparison group are comparable to the plaintiff “in all
material respects.” Crawford v. Indiana Harbor Belt R.R.
Co., 461 F.3d 844, 846 (7th Cir. 2006). That is, the inquiry
asks only whether “members of the comparison group are
sufficiently comparable to [the plaintiff] to suggest that
[the plaintiff] was singled out for worse treatment.” Id.
The similarly situated inquiry is a flexible, common-sense
one that asks, at bottom, whether “there are enough
common factors . . . to allow for a meaningful comparison
No. 06-3855 9
in order to divine whether intentional discrimination was
at play.” Barricks v. Eli Lilly and Co., 481 F.3d 556, 560
(7th Cir. 2007).
We agree that Henry failed to introduce evidence that
he was treated less favorably than similarly-situated
officers who were not white. Although Henry points to
several African-American police officers whose discipline
fell short of termination, none are sufficiently comparable
to suggest that Henry was singled out for harsher treat-
ment. First, Henry turns our attention to Officers Wilson
and Young, the two African-American officers involved in
Miles’s arrest and booking. Miles stated during an IAD
investigation interview that on the night he was booked,
Young elbowed him in the nose and Wilson punched him
in the head. If substantiated, then the officers’ continued
employment might give rise to an inference that the
defendants treated Henry less favorably than comparable
non-white officers. But here, the decision not to dis-
cipline the two officers based on Miles’s story does not
suggest that Henry was terminated because he is white.
Wilson and Young both adamantly deny striking Miles,
and, significantly, there is no corroboration whatsoever
to support Miles’s story that Wilson and Young inappro-
priately struck him. No other person supported the
story, and there is no medical or other evidence consistent
with Miles’s account—Miles’s story stands alone.
Henry’s conduct, however, was captured on videotape
and shown on the evening news. The tape shows Henry
suddenly pushing Miles while Miles has his arms at his
sides and then shoving him against a wall and onto a
desk. Moreover, the video shown on the news, which had
been trained on Henry and Miles for several minutes
before Henry grabbed Miles, does not evidence any physi-
cal provocation on Miles’s part. Instead, Miles stood with
his arms at his sides, a few feet in front of Henry’s desk,
and, as the IAD report found, he did not make any move-
10 No. 06-3855
ment toward Henry before Henry pushed him. The pres-
ence of a tape suggesting that an officer used force
against an arrested person without provocation can
present a far different call for discipline than an unsup-
ported story of excessive force by two officers. Moreover,
Henry acknowledges that Jones was motivated by the
negative publicity surrounding the incident, and only
Henry’s actions were shown on television. As a result,
the defendants’ decision to suspend Officers Wilson and
Young for thirty days for failing to report Henry’s treat-
ment of Miles does not give rise to an inference of racial
discrimination.
Henry also points to Officer Allen Perry, another
African-American officer. Officer Perry drew a “smiley
face” on a prisoner in a hospital and received a one-day
suspension. Drawing on a prisoner, although a form of
misconduct under the police department’s rules, is simply
not comparable to the sudden force Henry used on Miles.
Next, Henry cites Officer Michael Rousseau, who re-
ceived a one-day suspension for failing to report his use
of force. Notably, although the IAD investigated both
Rousseau and Henry for using excessive force against a
prisoner, the IAD concluded that Rousseau’s use of force
was appropriate, and Jones was justified in treating
Rousseau and Henry differently based on the different
conclusions reached after the IAD investigations. Finally,
Henry points to Officer Willie Murphy. After Murphy
was struck by a car and dragged down the street, he
discharged a firearm at the vehicle after it was moving
away and received a ten-day suspension (reduced to five
days on appeal). Although discharging the firearm also
apparently violated a departmental rule, physical force
had been used against Officer Murphy before he acted.
Before Henry struck Miles, in contrast, no force had
been used against him, nor had any movement been
made toward him. In sum, none of the officers to whom
No. 06-3855 11
Henry points mistreated arrestees under circumstances
comparable to those here.
For similar reasons, our recent decision in Pantoja v.
American NTN Bearing Manufacturing Corp., 495 F.3d
840 (7th Cir. 2007), would not help Henry. There, we
stated that in a termination case, “Once an employee can
show (in the sense of raising an issue of material fact
at the summary judgment stage) that he is meeting his
employer’s legitimate expectations (the second element),
then the fact that the employer needs to find another
person to perform that job after the employee is gone
raises the same inference of discrimination that the
continuation of a search does in the hiring situation.” Id.
at 846. In Pantoja, rather than contending that he was
meeting his employer’s legitimate expectations, the
plaintiff maintained that he was subject to particularly
strict employment standards because of his race. Id. at
847. We concluded that the plaintiff had not offered any
evidence that the employer’s expectations were tailored
to race, as the plaintiff ’s misconduct was more egregious
than that of the employees to whom he pointed. Id.
Similarly here, Henry has not put forth evidence suf-
ficient to support a finding that his employer tailored its
expectations to race. His conduct was more egregious
than that of the non-white officers he highlights. We
agree with the district court that Henry did not demon-
strate a prima facie case of discrimination on the basis
of race under the indirect method, and, therefore, that
he cannot avoid summary judgment on that basis.
B. Direct Method
Alternatively, a Title VII plaintiff can survive sum-
mary judgment by proceeding under the direct method
of proving racial discrimination. See Luks v. Baxter
Healthcare Corp., 467 F.3d 1049, 1052 (7th Cir. 2006). To
12 No. 06-3855
avoid summary judgment under the direct method, Henry
must introduce evidence showing that the decision to
terminate him was motivated by animus based upon his
race. See Sun v. Bd. of Trustees of Univ. of Ill., 473 F.3d
799, 812 (7th Cir. 2007). Although labeled the “direct”
method of proof, this method “is not limited to near-
admissions by the employer that its decisions were based
on a proscribed criterion (e.g., ‘You’re too old to work
here.’), but also includes circumstantial evidence which
suggests discrimination albeit through a longer chain of
inferences.” Luks, 467 F.3d at 1052. A plaintiff may
use direct evidence, circumstantial evidence, or a com-
bination of the two when proceeding under the direct
method. Lewis v. City of Chicago, 496 F.3d 645, 651 (7th
Cir. 2007). Circumstantial evidence of intentional dis-
crimination can include: “(1) suspicious timing, ambiguous
oral or written statements, or behavior toward or com-
ments directed at other employees in the protected group;
(2) evidence, whether or not rigorously statistical, that
similarly situated employees outside the protected class
received systematically better treatment; and (3) evidence
that the employee was qualified for the job in question
but was passed over in favor of a person outside the
protected class and the employer’s reason is a pretext
for discrimination.” Hemsworth v. Quotesmith.Com, Inc.,
476 F.3d 487, 491 (7th Cir. 2007) (citations omitted).
Henry agrees that this case does not involve an admis-
sion by his employer that he was terminated on account of
his race. Instead, he points to several circumstances which,
he maintains, suggest that he was terminated because he
is white. We disagree. Even when viewing together all the
circumstances to which Henry points, he has failed to
produce sufficient evidence that Jones decided to terminate
his employment because of his race.
We begin with Henry’s contention that the publicity
surrounding Miles’s booking suggests that Henry was
No. 06-3855 13
improperly terminated. He emphasizes, for one, that
the defendants initiated the Internal Affairs Division
investigation into the conduct that ultimately led to
Henry’s dismissal only after a local television station
aired a videotape of the booking on its newscast. More-
over, he points out, Jones attended a community meeting
where citizens expressed concern about the treatment
Miles had received while in custody, and a newspaper
published a letter from the Wisconsin Legislative Black
and Hispanic Caucus stating that the Caucus would be
carefully observing the police department’s response to
the issue. Henry suggests that Jones was contemplating
a run for mayor and that political aspirations motivated
him to terminate Henry after the booking was publicized.
Jones may or may not have been motivated by political
dreams or by the publicity that surrounded the booking.
But whether those were his motivations does not matter.
At issue here is whether Henry has presented sufficient
evidence that race motivated the decision to terminate
him, not whether political goodwill or fear of bad publicity
was the impetus for Jones’s decision. Politicians rou-
tinely respond to bad press they receive on television,
but it is not a violation of Title VII to take advantage of
a situation to gain political favor. As to Jones’s presence
at the community meeting, we note also that even Henry
acknowledges that during the ninety minutes that Jones
fielded questions and complaints from the audience,
Jones declined to comment on the videotape until an
internal investigation had been completed and promised
“everyone in the room the officer will have a fair investiga-
tion.” Declining to comment does not suggest racial
animus.
The decision to order an IAD investigation after seeing
the videotape of the booking also does not suggest that
race motivated the decision to terminate Henry. Henry
argues on the one hand that the decision to dismiss him
14 No. 06-3855
was a “rush to judgment” and on the other that he should
have been terminated sooner if his actions were egregious.
We would be hard-pressed to say that the police chief ’s
decision to wait for the results of the investigation before
terminating Henry suggests a racial motivation for his
firing. And even though other officers interviewed during
the investigation supported Henry’s account, the IAD
report concluded that the videotape showed Henry initiat-
ing contact without provocation and that Henry had
taunted Miles by patting his bicep after Miles was
handcuffed. We do not find anything suspicious in the
decision to impose discipline only after the investiga-
tion was complete.
Significant distinctions exist between a District Attor-
ney’s investigation into whether a person has committed a
crime and the IAD’s investigation of whether an
officer violates a department rule, and we are not per-
suaded that Jones’s refusal to rescind the discipline after
the District Attorney’s office declined to press charges
suggests that Henry’s race motivated the chief ’s decision.
Henry also points to Jones’s public announcement that
he was referring the case to the Federal Bureau of In-
vestigation even though the Board of Fire and Police
Commissioners had determined that Henry acted appropri-
ately. That a press release was issued announcing the
referral could suggest that Henry is correct when he
maintains that publicity surrounding the incident moti-
vated the chief. But if so, that is not enough to establish a
Title VII violation. Or, looking to the IAD report (which
was apparently not before the Board) and videotape, Jones
might have believed that Henry had acted improperly
and that the FBI would interpret Henry’s actions differ-
ently than the Board and District Attorney’s office had. In
short, there are many possibilities for Jones’s announce-
ment, but none in this record suggests that race motivated
the referral.
No. 06-3855 15
Henry also points to a jury’s conclusion during an earlier
suit that the City of Milwaukee and Jones discriminated
against seventeen white male police lieutenants on the
basis of race or gender when they did not receive promo-
tions to captain. Alexander v. City of Milwaukee, No. 03-C-
611 (E.D. Wis. Mar. 29, 2005), aff ’d, 474 F.3d 437 (7th Cir.
2007). That lawsuit, which involved decisions about
qualifications and the extent to which an employer
should promote gender and racial diversity in its leader-
ship, concerned different questions than the one here—
whether the defendants disciplined a white officer more
harshly than they would a minority officer for the use of
force against an arrested person. More importantly, the
result of that suit is not enough to suggest that the
termination decision here was made on the basis of race,
especially when the defendants acknowledge that the
negative publicity surrounding the airing of the tape led
to the termination decision.
The other circumstances to which Henry points do not
warrant significant comment. He contends that Jones’s
failure to appear at Henry’s appeal hearing constitutes
evidence of intentional discrimination, but we do not see
the connection. He also argues that Jones was somehow
unqualified to conclude whether Henry had violated the
department’s rule regarding mistreatment of prisoners
because the chief was not a certified “defense and arrest
tactics instructor.” First, Jones had the benefit of thorough
investigation and analysis from an officer who had been
trained in the use of force, Sergeant Graham, the author
of the IAD report. Second, as police chief, Jones was
responsible for the conduct of his officers, see Wis. Stat.
§ 62.50(23), and it strains credulity to contend that he
could not make disciplinary decisions based on a sub-
ordinate officer’s actions.
The essence of Henry’s argument is that the police
chief made a mistake when he ordered Henry terminated,
16 No. 06-3855
and so a Title VII violation must have occurred. But there
are many “mistaken” personnel decisions that do not
violate federal law. See, e.g., Guerrero v. Ashcroft, 253 F.3d
309, 314 (7th Cir. 2001). The decision in this case, whether
correct or not, does not raise a triable question as to
whether it was made on account of Henry’s race.
III. CONCLUSION
For the foregoing reasons, the district court’s grant of
summary judgment in favor of the defendants is AFFIRMED.
A true Copy:
Teste:
_____________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—11-1-07
| {
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262 P.3d 1187 (2011)
IN RE ESTATE OF PAHL.
No. 20110488.
Supreme Court of Utah.
August 17, 2011.
Petition for certiorari denied.
| {
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} |
949 N.E.2d 1098 (2011)
351 Ill. Dec. 3
LANGONE
v.
SCHAD, DIAMOND AND SHEDDEN, P.C.
No. 111942.
Supreme Court of Illinois.
May 1, 2011.
Disposition of Petition for Leave to Appeal[*] Denied.
NOTES
[*] For Cumulative Leave to Appeal Tables see preliminary pages of advance sheets and Annual Illinois Cumulative Leave to Appeal Table.
| {
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} |
COURT OF APPEALS
EIGHTH DISTRICT OF TEXAS
EL PASO, TEXAS
§
GEORGE EDWARD THERAGOOD, No. 08-10-00013-CR
§
Appellant, Appeal from
§
v. 435th District Court
§
THE STATE OF TEXAS, of Montgomery County, Texas
§
Appellee. (TC # 09-09-08902-CR)
§
OPINION
George Edward Theragood appeals his convictions of sexual assault (Counts I and II) and
aggravated sexual assault (Counts III and IV). A jury found Appellant guilty of each count and
assessed his punishment at a fine of $10,000 and imprisonment for twenty years on Counts I and II
and a fine of $10,000 and life imprisonment on Counts III and IV. The trial court ordered the
sentences to be served consecutively. For the reasons that follow, we affirm.
FACTUAL SUMMARY
Denashia Theragood is Appellant’s daughter. She began living with him and her aunt, Paula
Cardell, in Houston when she was six years old. Denashia went back and forth between her parents
for the next few years but she began living with him permanently when she was in the sixth grade.
At that time, they lived in Conroe. Appellant was a truck driver so he was often on the road for long
periods of time.
In December 2003, Denashia and her father were living in Conroe with Caroline Warren and
with several other people. When Appellant was home, he slept in the same room as Denashia.
Denashia recalled that when she was twelve, Appellant began making her rub his penis every night
that he was home. She never told anyone because he had told her he would get in trouble. Appellant
next began putting his finger in Denashia’s vagina. This abuse lasted for a few months before
progressing to sexual intercourse. Denashia testified that Appellant would have intercourse with her
whenever he came home from his road trips which she estimated to be 100 times or more. She did
not tell because she did not have anyone she could trust or who would believe her. Denashia finally
told her mother, Rosa Barrett, in December 2006 when she was fifteen years of age. Denashia’s
mother reported it to appropriate law enforcement authorities. A sexual assault examination was
performed, and the sexual assault nurse examiner determined that although the anus and hymen were
normal, this finding did not rule out sexual abuse.
Detective Tom Gannucci of the Montgomery County Sheriff’s Office interviewed Appellant.
Gannucci later asked another investigator in the Sheriff’s Office, Mark Handler, to interview
Appellant because of his skills as an interviewer. During cross-examination, defense counsel
established that Appellant had denied the allegations during this interview and Gannucci initially
believed him. To impeach Appellant’s credibility, the State introduced a judgment showing
Appellant had been convicted of failing to register as a sex offender.
Handler testified regarding his interview of Appellant. Appellant denied placing his penis
in Denashia’s vagina, but he admitted that he had touched her vagina while teaching her about sex.
He said that he became sexually excited when he did this. Appellant told Handler that he also
touched Denashia’s vaginal area because he shaved her pubic hair for reasons of hygiene. Appellant
became sexually excited when doing this but he was taking medication that caused erectile
disfunction. He added that if he had not been on the medication, “something might have happened.”
Handler drew an outline of Appellant’s hand and asked him to indicate which finger he used and
how far he had placed it inside of the vagina. The drawing, which was admitted as State’s Exhibit
4, indicates that Appellant inserted the tip of his middle finger into the vagina.
Yolanda Yvette testified during the State’s case-in-chief that Appellant lived with her mother
in Dallas. Yvette had been told that Appellant was her biological father but she later found out this
was not true. Appellant sexually abused Yvette on many occasions when she was between the ages
of six and ten. When the abuse began, Appellant made her “grind on his groin” and he would kiss
her, but the abuse progressed to anal and vaginal penetration. The abuse continued even after
Yvette’s mother ended her relationship with Appellant because Yvette would visit with him. During
these visits, Yvette slept in the same bed as Appellant and he would sexually assault her even when
other people were asleep in the bed with them. Yvette recalled that Appellant sexually assaulted her
on at least one occasion when Denashia’s mother was in the bed with them. Yvette made an outcry
and in 1994, Appellant entered a plea of no contest to aggravated sexual assault. The court placed
Appellant on deferred adjudication probation for five years. Yvette, who was twenty-seven years-old
at the time of trial, had not seen Appellant since she was eleven.
Several witnesses testified for the defense. Denashia’s mother, Rosa Barrett, contradicted
Yvette’s testimony about sleeping in the same bed with Yvette and Appellant. Barrett attended the
court proceedings when Appellant was indicted for sexually assaulting Yvette. She recalled from
those proceedings that Appellant was required to register as a sex offender. Appellant had told her
that he was not guilty and that Yvette was being manipulated by her mother to make the accusations.
Barrett knew that Appellant was strict with Denashia and he punished her for making a “C” in school
or talking too much on the telephone. When Denashia was fifteen, Barrett went to pick her up for
the Christmas holidays and discovered that she was sharing a room with Appellant. Barrett was both
surprised and concerned about this discovery. While Denashia was visiting her, Appellant called
because he had found Denashia’s diary and he was extremely upset and angry with her. Barrett told
Denashia that Appellant was upset with her and she would be punished when she returned home.
The day after Christmas, Denashia told her mother what Appellant had been doing. Barrett
immediately made a police report. Barrett denied encouraging her daughter to make up these
allegations so she could live with her and she did not believe that Denashia had fabricated the
accusations.
Paula Cardell testified that when Denashia lived with her, she shared a bedroom with
Cardell’s daughter. Appellant never spent the night at the house while Denashia lived there. There
were seven people living in the three-bedroom house when Denashia first moved in, but Cardell’s
niece and her children later moved into the house bringing the total to fifteen residents. Cardell was
aware of Appellant’s 1994 conviction for aggravated sexual assault of a child but she never believed
that it was true. She likewise did not believe Denashia because she was never alone with her father.
Appellant’s niece, Phylunda Theragood, lived with Cardell in 2003. Denashia slept in the
same bedroom as Phylunda and her children. Unlike Cardell, Phylunda testified that Appellant
sometimes spent the night at Cardell’s house when he returned from a trip. Phylunda did not believe
Denashia’s allegations.
Appellant’s girlfriend, Janice Pratt, testified that she and Appellant had been together since
1999. Consistent with Phylunda’s testimony, Pratt testified that Appellant sometimes spent time
wherever Denashia was living, but he also stayed with her. Denashia never lived with Pratt. Pratt
did not believe the allegations against Appellant.
Caroline Warren testified that Denashia moved in with her at the end of November 2003 and
had her own bedroom. Appellant left his clothes in the home but he was usually on the road, and
he often stayed with a friend when he returned. On cross-examination, Warren admitted that
Appellant occasionally spent the night in Denashia’s bedroom. Warren did not believe the
allegations.
Appellant testified against the advice of counsel. He pled no contest in 1994 to the
aggravated sexual assault of Yvette for the sole reason that the law enforcement authorities were
threatening to prosecute Rosa Barrett. Appellant admitted that he was convicted of failure to register
as a sex offender in 1999, but he explained that his attorney told him that he had five years to
register. When Appellant’s deferred adjudication probation was successfully completed and the case
dismissed, he thought he was no longer obligated to register.
In February of 2003, Denashia was on a break from school and wanted to travel to California
with Appellant in his truck. When they were outside of Abilene, Appellant discovered that Denashia
had started her menstrual period for the first time. He first called Barrett and then Cardell. Cardell
explained what to purchase and instructed him how the feminine hygiene products should be used.
They stopped at a truck stop and Appellant assisted Denashia in the shower by cleaning the vaginal
area with a wipe, but he never touched her body with his bare hand. Rather than continuing the trip
with Denashia, he drove to Houston and left Denashia with Cardell. Appellant had Denashia move
to Warren’s home in late November 2003 because Denashia had altered her report card. Count 4 of
the indictment alleged that Appellant sexually assaulted Denashia on or about December 2, 2003.
Appellant testified that he left on a trip in early October 2003 and he did not return to Houston until
January 8, 2004. In March 2004, Appellant was seriously injured in an accident and he had neck
surgery. Appellant stayed at Warren’s house for a few days after getting out of the hospital before
going to Pratt’s house to recuperate. On cross-examination, Appellant admitted that he spent a
considerable amount of time recuperating at Warren’s house.
In December 2004, Appellant resumed driving a truck. In 2005 and 2006, Appellant
continued making long hauls and only returned to the Houston area for a few days at a time. In late
December 2006, Barrett refused to let Denashia return to live with him, but Appellant did not know
why. In January 2007, Appellant was interviewed by three different people about Denashia’s
allegations. Appellant claimed he had denied sexually assaulting Denashia in each of these
interviews. He specifically denied ever telling Handler that he had sexual contact with her or that
he became sexually excited by the contact. He did admit that he indicated on the drawing of his hand
how far his middle finger, which was covered by the “wipe,” penetrated the vagina.
The jury rejected Appellant’s defenses and found him guilty of each of the four counts. The
jury assessed his punishment at a fine of $10,000 and imprisonment for twenty years on Counts I and
II and a fine of $10,000 and life imprisonment on Counts III and IV. The trial court ordered the
sentences to be served consecutively. This appeal follows.
IMPEACHMENT PURSUANT TO
TEX.R.EVID. 806
In his first Issue, Appellant contends that the trial court abused its discretion by admitting
evidence that Appellant had previously been convicted of failure to register as a sex offender. The
State responds that the evidence was properly admitted pursuant to Texas Rules of Evidence 609 and
806.
The Underlying Facts
Detective Tom Gannucci testified regarding his involvement in the case, including his
interview of Appellant. Gannucci later requested that another officer, Mark Handler, conduct a
second interview because of his skills as an interviewer. On cross-examination, Gannucci testified
that Appellant denied the allegations against him during the initial interview. He also admitted that
he told other people involved in the case that he believed Appellant and did not think he had
committed the offense. On re-direct, the State established that when Gannucci made these
statements he did not have the benefit of the facts learned during Handler’s interview of Appellant.
The State then offered into evidence a certified copy of the judgment reflecting Appellant’s
conviction in 1999 for failure to register as a sex offender. The State expressly made the offer
pursuant to TEX .R.EVID . 806 and argued that the prior conviction was admissible to impeach
Appellant’s hearsay statement made to Gannucci that he did not commit the offense. Appellant
objected that his prior conviction “has nothing to do with whether or not he committed this crime”
and he added that he should not be tried based on his prior convictions. Appellant also objected that
the probative value of the evidence was outweighed by prejudice.1 With respect to the State’s offer
of the evidence under Rule 806, Appellant objected that the prior conviction was not admissible to
impeach the witness’s opinion or the basis for it. The trial court overruled the objections and
admitted the prior conviction.
Later, Appellant testified in his own defense and admitted that in 1994, he had pleaded no
contest to aggravated sexual assault of a child and he was placed on deferred adjudication
community supervision for five years. Appellant also testified that he was convicted of failing to
register as a sex offender. The judgment admitted into evidence reflects that sentence was imposed
on November 11, 1999.
Relevant Law and
Standard of Review
We review a trial court’s decision to admit or exclude evidence for an abuse of discretion.
De La Paz v. State, 279 S.W.3d 336, 343 (Tex.Crim.App. 2009); McDonald v. State, 179 S.W.3d
571, 576 (Tex.Crim.App. 2005). Under this standard, an appellate court should not disturb the trial
1
Defense counsel actually misstated the objection by arguing that the probative value outweighs the prejudicial
impact, but the context of her objection indicates she meant the opposite and it appears the trial court understood her
objection.
court’s decision if the ruling was within the zone of reasonable disagreement. De La Paz, 279
S.W.3d at 343-44; Bigon v. State, 252 S.W.3d 360, 367 (Tex.Crim.App. 2008).
Rule 806 provides that “[w]hen a hearsay statement . . . has been admitted in evidence, the
credibility of the declarant may be attacked . . . by any evidence which would be admissible for those
purposes if declarant had testified as a witness.” TEX .R.EVID . 806. This rule permits a party to
impeach the credibility of the non-testifying hearsay declarant with evidence of the declarant’s prior
convictions. Griffith v. State, 983 S.W.2d 282, 290 (Tex.Crim.App. 1998). Further, Rule 806 has
been held to apply when the declarant is the non-testifying defendant. See Appling v. State, 904
S.W.2d 912, 916 (Tex.App.--Corpus Christi 1995, pet. ref’d). A defendant who testifies subjects
himself to cross-examination and impeachment in the same manner as any other witness. Bowley
v. State, 310 S.W.3d 431, 434 (Tex.Crim.App. 2010). This would include impeachment with a prior
conviction as permitted by TEX .R.EVID . 609.
Rule 609(a) provides as follows:
(a) General Rule. For the purpose of attacking the credibility of a witness, evidence
that the witness has been convicted of a crime shall be admitted if elicited from the
witness or established by public record but only if the crime was a felony or involved
moral turpitude, regardless of punishment, and the court determines that the
probative value of admitting this evidence outweighs its prejudicial effect to a party.
TEX.R. EVID. 609(a).
Preservation of Error
Appellant first argues that Rule 806 is applicable because the statement sought to be
impeached, Gannucci’s testimony that Appellant denied the allegations, is not hearsay. The State
responds that Appellant waived this issue because he did not raise it in the trial court. We agree.
Evidentiary error must be preserved by making a proper objection and securing a ruling on that
objection. TEX .R.APP .P. 33.1(a); Wilson v. State, 71 S.W.3d 346, 349 (Tex.Crim.App. 2002);
Peralta v. State, 338 S.W.3d 598 (Tex.App.--El Paso 2010, no pet.). A proper objection is one that
is specific and timely. TEX .R.APP . P. 33.1(a); Wilson, 71 S.W.3d at 349. While Appellant objected
that the prior conviction was not admissible to impeach Gannucci’s opinion about Appellant’s
innocence, he did not assert that Rule 806 did not apply because Gannucci’s testimony about
Appellant’s denial of the allegations was not hearsay. Accordingly, this part of his argument is
waived.
Probative Value v. Prejudicial Effect
Citing TEX .R.EVID . 403, Appellant also argues that the trial court abused its discretion by
admitting the prior conviction because the danger of unfair prejudice substantially outweighed any
probative value. Since the evidence was admitted pursuant to Rules 609 and 806, the applicable
balancing test is the one provided by Rule 609(a). In Theus v. State, the Texas Court of Criminal
Appeals articulated a non-exclusive list of five factors for courts to consider in determining under
Rule 609 whether a prior conviction’s probative value outweighs its prejudicial effect. Theus v.
State, 845 S.W.2d 874, 880 (Tex.Crim.App. 1992). The five factors are: (1) the impeachment value
of the prior crime, (2) the temporal proximity of the past crime relative to the charged offense and
the witness’s subsequent history, (3) the similarity between past crimes and the charged offense, (4)
the importance of the defendant’s testimony, and (5) the importance of the credibility issue. Id.
Looking first at the impeachment value of the prior crime, we keep in mind that a crime
involving deception is higher than crimes involving violence. Theus, 845 S.W.2d at 881. When
a party seeks to impeach a witness with evidence of a crime that relates more to deception than not,
the first factor weighs in favor of admission. Id. We agree with the State that the prior crime
involves deception since Appellant, by failing to register, concealed the address at which he resided
or intended to reside. See generally TEX .CODE CRIM .PROC.ANN . art. 62.051(c)(West Supp.
2010)(listing required information to be supplied on registration form). This factor militates in favor
of admission.
The second factor requires an examination of the temporal proximity of the past crime to the
charged offense and Appellant’s subsequent history. This factor will favor admission if the past
crime is recent and if the witness has demonstrated a propensity for running afoul of the law. Theus,
845 S.W.2d at 881. Appellant was convicted of failing to register as a sex offender on November
11, 1999. The indictment alleged two counts of sexual assault and two counts of aggravated sexual
assault alleged to have occurred between December of 2003 and September 2, 2006. The aggravated
sexual assault charged in Count IV is alleged to have been committed on or about December 2, 2003
and the jury found Appellant guilty of Count IV as charged in the indictment. Given that one of the
charged offenses occurred only five years after the past crime, we conclude that the second factor
also favors admission. See Theus, 845 S.W.2d at 881 (five years held recent relative to charged
offense under temporal proximity factor).
The third factor addresses the similarity between the past crime and the charged offense.
Similarity between the past crime and the charged crime will militate against admission because the
similarity increases the likelihood that a jury might convict based on the perception of a pattern of
past conduct, rather than on the facts of the charged offense. Id. Failure to register as a sex offender
is a different offense than sexual assault, but the admission of this prior conviction nevertheless
informed the jury that Appellant had been determined to be a sex offender so there is some potential
for the jury to perceive a pattern of past conduct. We conclude there is enough of a similarity that
this factor weighs against admission.
We will consider the last two factors together because both depend on the nature of the
defense and the means available to prove that defense. Theus, 845 S.W.2d at 881. In this case,
Appellant’s testimony and credibility are critical to his defense because no other witness could
dispute Detective Handler’s account of his interview of Appellant and the meaning of the drawing
admitted as State’s Exhibit 4. Given the importance of Appellant’s testimony to his defense, the
State’s need to impeach Appellant’s credibility is likewise significant. The final two factors favor
admission of the evidence.
Even though the majority of the factors favor admission of the evidence, there is some
potential for the jury to convict based on a pattern of past conduct rather than the facts of the case.
See Theus, 845 S.W.2d at 881 (holding that even though four of the factors favored admission of the
evidence, the lack of impeachment value overrode the other four factors). The trial court, however,
minimized the prejudice resulting from the admission of this conviction by instructing the jury that
it could consider the evidence only as it related to Appellant’s credibility and for the other
permissible purposes specified in the charge. The trial court did not abuse its discretion by
concluding that the probative value of the evidence outweighed its prejudicial effect. Issue One is
overruled.
EXTRANEOUS OFFENSE
In his second issue, Appellant argues that the trial court erred by admitting evidence that
Appellant had sexually assaulted another child because the evidence was not relevant to an
admissible purpose under Rule 404(b) and the danger of unfair prejudice outweighed the probative
value of the evidence.
Relevant Law and Standard of Review
Generally, evidence of extraneous offenses may not be used against the accused in a criminal
trial. Daggett v. State, 187 S.W.3d 444, 450 (Tex.Crim.App. 2005). In the face of a proper
objection, evidence of other wrongful acts is not admissible to prove the character of the person to
establish that he acted accordingly regarding the alleged offense. TEX .R.EVID . 404(b); Powell v.
State, 63 S.W.3d 435, 438 (Tex.Crim.App. 2001). An extraneous offense may be admissible,
however, if it has relevance apart from its tendency to prove the character of a person in order to
show that he acted in conformity therewith. Montgomery v. State, 810 S.W.2d 372, 387
(Tex.Crim.App. 1990)(op. on reh’g). Evidence which logically serves such purposes as “proof of
motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or
accident” is relevant beyond its tendency to prove conforming character. TEX .R.EVID . 404(b);
Montgomery, 810 S.W.2d at 387. The list of “other purposes” identified in Rule 404(b) is not
exclusive. Rogers v. State, 853 S.W.2d 29, 33 (Tex.Crim.App. 1993).
Rebuttal of a defensive theory is also one of the permissible purposes for which relevant
evidence may be admitted under Rule 404(b). Moses v. State, 105 S.W.3d 622, 626 (Tex.Crim.App.
2003). This exception includes defenses based on a claim of fabrication, retaliation, or lack of
opportunity. See Bass v. State, 270 S.W.3d 557, 563 (Tex.Crim.App. 2008)(extraneous-offense
evidence was admissible for the noncharacter-conformity purpose of rebutting the defendant’s
defensive theory that the complainant fabricated her allegations against him and the defensive theory
that the defendant, as a pastor, would not engage in the type of conduct alleged in the indictment);
Powell, 63 S.W.3d at 438-40 (in prosecution for indecency with a child, defendant’s opening
statement that he lacked opportunity to molest the complainant because other children were always
present opened the door to admission of extraneous-offense evidence that defendant molested others
under almost identical circumstances to rebut defendant’s lack of opportunity defensive theory);
Isenhower v. State, 261 S.W.3d 168, 181 (Tex.App.--Houston [14th Dist.] 2008, no pet.)(in a sexual
assault of a child case, extraneous offense admissible to rebut defensive theory of retaliation).
We review the trial court’s admission of extraneous offense evidence for an abuse of
discretion. Prible v. State, 175 S.W.3d 724, 731 (Tex.Crim.App. 2005); Moses, 105 S.W.3d at 627.
If the trial court’s ruling is within the zone of reasonable disagreement, there is no abuse of
discretion. Id.
Other Purposes
Appellant concedes that an extraneous offense may be admissible to rebut a defensive theory,
but he insists he did not raise a defensive theory during either his opening statement or cross-
examination. The indictment alleges that Appellant sexually assaulted the complainant on four
occasions between 2003 and 2006. During the opening statement, Appellant’s attorney stated that
he had custody of her from 2003 to 2006. Counsel added that during this time period, Appellant had
other individuals take care of the victim because he was a truck driver and he did not care for her
while he was on the road. During cross-examination of the complainant, defense counsel established
that in 2003 the complainant and Appellant lived in the home of her aunt, Paula Cardell, along with
numerous other people. Similarly, the complainant and Appellant lived with Caroline Warren and
several other people. Defense counsel also elicited testimony that Appellant was often on the road
for months at a time and he only stayed a few weeks when he returned. When this evidence is
considered with the opening statement, it arguably raises a lack of opportunity defense.
The victim in the extraneous offense case, Yolanda Yvette, testified that Appellant sexually
abused her on numerous occasions when she was between the ages of six and ten. The assaults
occurred even when other people were in the home and on one occasion, Appellant molested her
even though another person2 was in bed with them. The trial court could have reasonably concluded
that the extraneous offense was relevant to rebut the lack of opportunity defensive theory because
Appellant sexually abused Yvette in circumstances similar to those presented in the charged offense.
2
The other person in bed was the mother of the complainant in the instant case.
See Powell, 63 S.W.3d at 438-40.
Appellant raised a defense of fabrication through cross-examination of the complainant.
During cross-examination, Appellant’s attorney focused on the complainant’s failure to make an
outcry to either her mother while visiting her in July of 2006 or to a school counselor, a doctor, or
a relative at any time. Counsel specifically questioned the complainant about her denial of any
sexual misconduct by Appellant when Caroline Warren asked her about it. Defense counsel also
established through cross-examination of the complainant that Appellant was considerably stricter
than her mother and she had gotten in trouble for breaking Appellant’s rules. This evidence permits
an inference that the complainant fabricated the allegations. The trial court could have concluded
that the extraneous offense was relevant to rebut this defensive theory. See Bass, 270 S.W.3d at 562-
63. Consequently, the court did not abuse its discretion by determining that the extraneous offense
has relevance beyond character conformity.
Rule 403
Appellant next argues that the extraneous offense evidence was inadmissible under
TEX .R.EVID . 403. Rule 403 provides: “Although relevant, evidence may be excluded if its probative
value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or
misleading the jury, or by considerations of undue delay, or needless presentation of cumulative
evidence.” This rule favors the admission of relevant evidence, and it is presumed that relevant
evidence will be more probative than prejudicial. Shuffield v. State, 189 S.W.3d 782, 787
(Tex.Crim.App. 2006). When undertaking a Rule 403 analysis, a trial court must balance (1) the
inherent probative force of the proffered evidence along with (2) the proponent’s need for that
evidence against (3) any tendency of the evidence to suggest decision on an improper basis, (4) any
tendency of the evidence to confuse or distract the jury from the main issues, (5) any tendency of the
evidence to be given undue weight by a jury that has not been equipped to evaluate the probative
force of the evidence, and (6) the likelihood that presentation of the evidence will consume an
inordinate amount of time or merely repeat evidence already admitted. Gigliobianco v. State, 210
S.W.3d 637, 641-42 (Tex.Crim.App. 2006).
Appellant argues that the probative value of the evidence is substantially outweighed by the
danger of unfair prejudice. The term “probative value” refers to the inherent probative force of an
item of evidence--that is, how strongly it serves to make more or less probable the existence of a fact
of consequence to the litigation--coupled with the proponent’s need for that item of evidence. Casey
v. State, 215 S.W.3d 870, 879 (Tex.Crim.App. 2007); Gigliobianco, 210 S.W.3d at 641. “Unfair
prejudice” refers to a tendency to suggest decision on an improper basis, commonly, though not
necessarily, an emotional one. Casey, 215 S.W.3d at 879, 883. Evidence might be unfairly
prejudicial if, for example, it arouses the jury’s hostility or sympathy for one side without regard to
the logical probative force of the evidence. Id. at 880. Unfair prejudice does not arise from the mere
fact that evidence injures a party’s case. Id. at 883.
The evidence possesses considerable probative value because it refuted Appellant’s defensive
theories of fabrication and lack of opportunity to commit the charged offense. The State did not have
any evidence, other than the complainant’s testimony, to refute these defensive theories. Yvette’s
testimony that Appellant had sexually abused her on numerous occasions was certainly prejudicial
and would generate an emotional response, but that is offset by the significant probative value of the
evidence and the State’s need for it. Accordingly, we find that the trial court did not abuse its
discretion by finding that the probative value of the extraneous offense evidence was not
substantially outweighed by the danger of unfair prejudice. We overrule Issue Two and affirm the
judgment of the trial court.
August 31, 2011
ANN CRAWFORD McCLURE, Justice
Before Chew, C.J., McClure, and Rivera, JJ.
(Do Not Publish)
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02-11-519 & 520-CR
COURT
OF APPEALS
SECOND
DISTRICT OF TEXAS
FORT
WORTH
NO. 02-11-00519-CR
NO. 02-11-00520-CR
ANTHONY MARK KLISH
APPELLANT
V.
THE STATE OF TEXAS
STATE
------------
FROM CRIMINAL DISTRICT
COURT NO. 2 OF TARRANT COUNTY
------------
MEMORANDUM OPINION[1]
------------
Appellant Anthony Mark Klish appeals his convictions and ten year concurrent
prison sentences imposed by the court after he pled guilty without a plea
bargain to two charges of burglary of a habitation. We affirm.
Appellant’s court-appointed appellate
counsel has filed a motion to withdraw as counsel, accompanied by a brief in
support of that motion. In the brief, counsel states
that in his professional opinion these appeals are frivolous and without merit.
Counsel’s brief and motion meet the requirements of Anders v. California,
386 U.S. 738, 87 S. Ct. 1396 (1967), by presenting a professional evaluation of
the records demonstrating why there are no arguable grounds for relief.
Appellant filed a pro se response to the Anders brief. The State
has filed a letter brief.
Once an appellant’s court-appointed
attorney files a motion to withdraw on the grounds that an appeal is frivolous
and fulfills the requirements of Anders, this court is obligated to
undertake an independent examination of the record. See Stafford v.
State, 813 S.W.2d 503, 511 (Tex. Crim. App.
1991); Mays v. State, 904 S.W.2d 920, 922–23
(Tex. App.—Fort Worth 1995, no pet.). Only then may we grant counsel’s
motion to withdraw. See Penson v. Ohio,
488 U.S. 75, 82–83, 109 S. Ct. 346, 351 (1988).
We have carefully reviewed the
records, counsel’s brief, Appellant’s response, and the State’s letter
brief. We agree with counsel that these appeals are wholly frivolous and
without merit; we find nothing in the records that might arguably support the
appeals. See Bledsoe v. State, 178 S.W.3d 824, 827–28 (Tex. Crim.
App. 2005); see also Meza v. State, 206 S.W.3d 684, 685 n.6 (Tex. Crim. App. 2006). Accordingly, we grant
counsel’s motion to withdraw and affirm the trial court’s judgments.
PER CURIAM
PANEL: GABRIEL, J.; LIVINGSTON, C.J.;
and MEIER, J.
DO NOT PUBLISH
Tex. R. App. P. 47.2(b)
DELIVERED: October 18,
2012
COURT
OF APPEALS
SECOND
DISTRICT OF TEXAS
FORT
WORTH
NO. 02-11-00519-CR
Anthony Mark Klish
v.
The State of Texas
§
§
§
§
§
From Criminal District
Court No. 2
of Tarrant County (1231611D)
October 18, 2012
Per Curiam
(nfp)
JUDGMENT
This court has considered the record on appeal in this case and holds that
there was no error in the trial court’s judgment. It is ordered that the
judgment of the trial court is affirmed.
SECOND
DISTRICT COURT OF APPEALS
PER CURIAM
COURT
OF APPEALS
SECOND
DISTRICT OF TEXAS
FORT
WORTH
NO. 02-11-00520-CR
Anthony Mark Klish
v.
The State of Texas
§
§
§
§
§
From Criminal District Court No. 2
of Tarrant County (1239674D)
October 18, 2012
Per Curiam
(nfp)
JUDGMENT
This court has considered the record on appeal in this case
and holds that there was no error in the trial court’s judgment. It is ordered that the judgment of the trial
court is affirmed.
SECOND DISTRICT COURT OF APPEALS
PER CURIAM
[1]See
Tex. R. App. P. 47.4.
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614 F.3d 698 (2010)
FUSION CAPITAL FUND II, LLC, Plaintiff-Appellee,
v.
Richard HAM and Carla Aufdenkamp, Defendants-Appellants.
No. 09-3723.
United States Court of Appeals, Seventh Circuit.
Argued June 2, 2010.
Decided August 2, 2010.
*699 Edward F. Malone (argued), Barack, Ferrazzano, Kirschbaum & Nagelberg LLP, Chicago, IL, for Plaintiff-Appellee.
Arthur E. Rosenson (argued), Cohen Rosenson & Zuckerman, LLC, Chicago, IL, for Defendants-Appellants.
Before EASTERBROOK, Chief Judge, and POSNER and KANNE, Circuit Judges.
EASTERBROOK, Chief Judge.
Millenium Holding Group, Inc., has shares that were registered under the Securities Act of 1933 and are traded over the counter. It also has few assets and is insolvent. In 2004 its assets came to $60,000 and its liabilities to $1.5 million; things have not improved since. Millenium does not have any ongoing business, though it does have a professionally designed web site (http://www.mnhginc.com/ millenium.html).
In July 2004 Millenium and Sutura, Inc., a firm that does have a business (it makes and sells medical devices), signed a merger agreement. What Sutura, a privately held firm, saw in Millenium was its tradable stock. Sutura wanted to go public without all the fuss and bother (and expense) of a registration statement and the release of audited financials. The proposed transactiona reverse merger in which an operating company (Sutura) merges into a shell (Millenium), which then changes its name to match the operating company'sis known to securities lawyers as "going public by the back door." The SEC treats these transactions with disdain, but they are not illegal. (We need not get into the complex issues that may arise when a shell goes public as part of a plan to facilitate the later distribution of another company's stock. No one contends that there was any legal problem with the transaction between Sutura and Millenium, whose stock had traded for more than five years before the merger was arranged.)
Sutura wanted new equity capital, and Millenium promised to sell enough stock to raise at least $15 million. Fusion Capital Fund II agreed to be the financial angel. Fusion and Millenium signed a contract by *700 which Fusion promised to invest $15 million, subject to certain conditionsincluding consummation of the merger. When the merger had not closed by October 31, 2004, Fusion wrote to Millenium that the money would not be forthcoming. Millenium could not find a replacement source of capital, and Sutura then terminated the merger agreement. (Sutura eventually went public by merging with Technology Visions Group, Inc., another shell with tradable shares.)
Millenium sued Fusion in Nevada, contending that Fusion had tortiously interfered with the merger agreement. (Millenium is incorporated in Nevada and has its principal place of "business" there, which accounts for the choice of venue.) After two years of litigation, the court ruled in Fusion's favor. The contract between Fusion and Millenium requires it to pay Fusion's legal fees, and Fusion filed suit in a federal court in Illinois seeking a judgment under that clause. The parties have agreed that Fusion did not need to raise that issue in the Nevada proceedings. The litigation comes within the diversity jurisdiction. (Fusion is a limited liability company; all of its members are citizens of Illinois.)
A claim against Millenium isn't worth the cost of mailing it to the courthouse, however, because Millenium is so far under water. Fusion needs a solvent obligor. It chose Richard Ham and Carla Aufdenkamp, who own a majority of Millenium's stock and are its sole board members and managers. (Ham and Aufdenkamp, citizens of Nevada who are married, call themselves "the Hams"; we do likewise.) Fusion sued the Hams as well as Millenium. The district court held that Millenium owes Fusion about $1.2 million for legal outlays, 590 F.Supp.2d 1055 (N.D.Ill. 2008), and added that the Hams are personally responsible for Millenium's debt to Fusion. 2009 U.S. Dist. LEXIS 65002 (N.D.Ill. July 28, 2009). The Hams appeal; Millenium does not.
Because Millenium is incorporated in Nevada, that state's law determines whether its investors are liable for its debts. (This is an aspect of the internal-affairs doctrine, a choice-of-law rule to which Illinois adheres. See Libco Corp. v. Roland, 99 Ill.App.3d 1140, 1144, 55 Ill. Dec. 334, 426 N.E.2d 309, 312 (1981).) The contract also contains a choice-of-law clause specifying Nevada law for issues concerning Millenium and its stockholders. Nevada has a law for this subject:
1. Except as otherwise provided by specific statute, no stockholder, director or officer of a corporation is individually liable for a debt or liability of the corporation, unless the stockholder, director or officer acts as the alter ego of the corporation.
2. A stockholder, director or officer acts as the alter ego of a corporation if:
(a) The corporation is influenced and governed by the stockholder, director or officer;
(b) There is such unity of interest and ownership that the corporation and the stockholder, director or officer are inseparable from each other; and
(c) Adherence to the corporate fiction of a separate entity would sanction fraud or promote a manifest injustice.
Nev.Rev.Stat. § 78.747. Earlier decisions had devised a similar approach as a matter of common law. See, e.g., Ecklund v. Nevada Wholesale Lumber Co., 93 Nev. 196, 197, 562 P.2d 479, 479-80 (1977). These decisions all speak of "fraud or injustice" as the third element; the statute, enacted in 2001, refers to "manifest injustice" rather than simple injustice. Nevada's judiciary has not decided whether there is a difference; we needn't do so either.
*701 The district court concluded that the Hams influence and govern Millenium; they concede this point on appeal. The district court also found that there is a unity of interest between the Hams and Millenium, making them inseparable as a practical matter, and that finding is amply supported. Millenium has scant existence apart from the Hams. It does not have significant assets, does not observe corporate formalities (its bylaws require at least three directors, but the Hams are the only members of its board); does not have audited financial statements; and does not file tax returns. Millenium's corporate headquarters is the Hams' residence (which they "rent" from Millenium, in exchange for forgiveness of "salaries" that they have not earned, after advancing the funds that Millenium uses to lease the house from a third party).
As for the third element: there isn't any fraud, because Fusion knew that Millenium is a husk without any corn inside. See Sea-Land Services, Inc. v. Pepper Source, 941 F.2d 519 (7th Cir.1991) (Illinois law). And this knowledge also makes it hard to see how limiting the Hams' liability would produce an "injustice," manifest or otherwise. Fusion was not deceived, hornswoggled, misled, duped, hoodwinked, bamboozled, or snookered. The "injustice" component comes to the fore when a creditor's claim is based on tort law, because victims rarely understand in advance that they are dealing with shell corporations (if indeed they understand before the injury that they are dealing with anyone at all). It may be important for some contract claims too, if the corporation leads the other party to think that it is normally capitalized and will be able to satisfy its obligations. See, e.g., Carson Meadows, Inc. v. Pease, 91 Nev. 187, 533 P.2d 458 (1975). But Fusion not only understood that Millenium was a shell but also knew that its shell status was exactly why it was attractive to Sutura, and why Millenium couldn't put up any of the $15 million. Millenium's thin capitalization was both the reason why this deal had been proposed and the dominant feature in the deal's structure. Fusion went in with eyes open.
When Millenium signed a contract promising to reimburse Fusion's legal expenses if litigation ensued, Fusion knew beyond doubt that Millenium would be unable to keep that promiseunless the merger closed. Someone who wants to protect himself against the possibility that a thinly capitalized corporation will be unable to pay its debts asks the investors for a guaranty. It is feckless to do business with a corporation such as Millenium without one. Yet Fusion not only did not get a guaranty but also did not even ask for one. Its brief says that it didn't ask because it was sure the merger would close, so no additional source of funds would be required. Yet the point of a guaranty is to provide for payment if a deal goes sour. A business such as Fusion that neglects to arrange for payment if the worst comes to pass is not well positioned to seek judicial aid. What Fusion wants is an approach that gives a corporation's contracting partners the legal equivalent of a guaranty whether the investors agree to that arrangement or not. This would reduce the options available for business transactions and make everyone worse off.
A rule such as Nev.Rev.Stat. § 78.747 makes investors personally liable only in the sort of situations in which private negotiations failwhen fraud spoils the voluntariness of the choice, when the investors make net withdrawals from the corporation after the contract has been formed and thus frustrate its ability to keep its promises (a fraudulent conveyance if the corporation is insolvent, or the transfer makes it so), or when there were no negotiations (as with tort creditors) *702 and permitting investors to insulate themselves from those claims would be unjust.
We do not know of any statute or decision, in any American jurisdiction, holding that investors in a thinly capitalized corporation are personally liable for its debts to a contracting partner when that partner, with knowledge of the corporation's insolvency, signs without getting a guaranty from the investors. The closest Nevada has come is Mosa v. Wilson-Bates Furniture Co., 94 Nev. 521, 583 P.2d 453 (1978), which held that an investor who had "assured" the creditor that the investor would pay, if the corporation could not, must keep that promise. It is unclear whether the state court treated the "assurance" as a contract equivalent to a guaranty, or concluded that the investor committed fraud by inducing unwarranted reliance on an empty assurance. (Making a promise that one plans to ignore is fraud. See The Wharf (Holdings) Ltd. v. United International Holdings, Inc., 532 U.S. 588, 121 S.Ct. 1776, 149 L.Ed.2d 845 (2001).) But whichever way Mosa is understood, it is some distance from a situation such as ours, in which the investors did not vow in advance to make good the corporation's debts.
Meanwhile, lots of decisions hold that people who knowingly deal with a corporation without getting a guaranty can't turn to investors on an alter-ego or veil-piercing theory. For a few of these decisions from Nevada, see Paul Steelman, Ltd. v. Omni Realty Partners, 110 Nev. 1223, 1226, 885 P.2d 549, 551 (1994); Lipshie v. Tracy Investment Co., 93 Nev. 370, 377-79, 566 P.2d 819, 823-24 (1977); O'Connell v. Cox, 78 Nev. 40, 44, 368 P.2d 761, 763 (1962). Ecklund, which we cited earlier, is another decision in this line. See also Baer v. Amos J. Walker, Inc., 85 Nev. 219, 221, 452 P.2d 916, 917 (1969) (refusing to hold corporation liable as alter ego of its manager because "[t]here is no proof that the credit of the corporation was relied upon by the [creditor]" when it lent money to the manager). The leading decision is Hanson v. Bradley, 298 Mass. 371, 10 N.E.2d 259 (1937), which as far as we can see has been followed by every state court that has addressed the subject.
The district court took umbrage at the Hams' financial maneuverings. They provide money to Millenium, which uses the cash to lease a house for the Hams' use. They put large "salaries" for themselves on the corporate books, then set off their rental obligations on the house against part of those salaries. Their salaries vastly exceed the value of the rent plus any services they provide to Millenium, which therefore sinks ever further into debt. Since the merger fell through, they have not supplied Fusion with financial statements (leading Fusion to describe Millenium as a black box). They caused Millenium to "agree" to pay substantial rates of interest on the money they "loaned" to it (principally the unpaid "salaries"); this means even more red ink. But Fusion, which knew from the outset that Millenium was insolvent and had debts to its insiders, was not injured by any of these things. It is a matter of indifference to Fusion whether Millenium's paper losses are $1 million or $1 billion; it knew from the getgo that Millenium could not pay its debts, so the precise details of its balance sheet can't produce an "injustice" for the purpose of Nevada law. See generally Stephen B. Presser, Piercing the Corporate Veil § 2:29 (2010 ed.) (discussing the law of investor liability in Nevada).
The district court relied principally on Lorenz v. Beltio, Ltd., 114 Nev. 795, 963 P.2d 488 (1998), and LFC Marketing Group, Inc. v. Loomis, 116 Nev. 896, 8 P.3d 841 (2000). Neither of these decisions supports Fusion's position. Lorenz *703 arose from a long-term lease. By the time 27 years had passed, the lessee had transferred its interest several times, and the latest assignee had formed a corporation to occupy the premises. That thinly capitalized corporation refused to pay or vacate; the Supreme Court of Nevada concluded that the corporation's controlling investors must pay the rent. It does not help Fusion because the lessor never dealt with the newly formed corporation. Similarly, if Millenium had been solvent when Fusion signed its contract, and the Hams had siphoned off Millenium's assets before beginning the Nevada litigation, Fusion would have a solid claim to relief. But that's not what happened; Millenium has been insolvent from the start. As for LFC: Lange, a debtor, transferred assets to LFC, a corporation in which Lange's brother held all the stock. Lange's creditor could not satisfy the debt by seizing his stock in LFC, for Lange had none. The court held that LFC could be ordered to transfer the assets to Lange's creditor. That's a form of recovery for a fraudulent conveyance, and we've already explained why nothing of the kind occurred here.
Fusion hints at a different kind of "injustice": Millenium took the offensive in the Nevada suit. If it had prevailed, the Hams would have pocketed 100% of the money; now that Millenium has lost, the Hams say they owe nothing. But this asymmetry is common in corporate transactions. Equity owners want the corporation to take risks, because if the gamble pays off they reap the rewards, and if it doesn't they just walk away, and the losses will fall elsewhere (on debt investors or outsiders such as Fusion). Fusion wants to be protected from this asymmetry, but to get this protection Fusion should have negotiated for a guaranty and refused to deal if the Hams would not give one. Far better to encourage voluntary contracts than to warp the law of investors' liability, after the fact, to protect commercial entities that failed to protect themselves.
REVERSED.
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541 U.S. 1073
EGBUNEv.COLORADO.
No. 03-1394.
Supreme Court of United States.
June 1, 2004.
1
Dist. Ct. Colo., Arapahoe County. Certiorari denied.
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908 F.2d 970
Gallegos-Martinezv.I.N.S.*
NO. 90-4051
United States Court of Appeals,Fifth Circuit.
JUL 09, 1990
1
Appeal From: I.N.S.
2
AFFIRMED.
*
Fed.R.App.P. 34(a); 5th Cir.R. 34.2
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114 U.S. 474 (1885)
BURTON
v.
WEST JERSEY FERRY COMPANY.
Supreme Court of United States.
Argued April 9, 1885.
Decided April 20, 1885.
IN ERROR TO THE CIRCUIT COURT OF THE UNITED STATES FOR THE EASTERN DISTRICT OF PENNSYLVANIA.
Mr. Jerome Carty [Mr. B. Frank Clapp and Mr. Mayer Sulzberger were with him] for plaintiff in error.
*475 Mr. Richard C. Dale [Mr. Samuel Dickson was with him] for defendant in error.
MR. JUSTICE HARLAN delivered the opinion of the court.
The plaintiff in error, who was plaintiff below, took passage at Camden, New Jersey, for Philadelphia, on a ferry-boat belonging to the defendant, a New Jersey corporation engaged in the business of transporting passengers, animals, and vehicles across the Delaware between those cities. On that trip the boat was unusually crowded with passengers. The river at the time was very full of ice, and it was difficult for the boat to get across and enter the ferry slip on the Philadelphia side. The wharf on that side was reached only after repeated efforts. In the attempt to land the boat was driven against the bridge with such force as to throw the plaintiff and a number of other persons (all of whom were standing during the passage across the river) with great violence upon the floor. The fall caused serious and, perhaps, permanent injury to the plaintiff. In this action she claims damages from the defendant upon the ground that her injuries resulted from the careless and negligent management of the ferry-boat by its agents and servants. The plaintiff made a case entitling her to go to the jury upon the issue as to the defendant's negligence. But there was, also, proof tending to show that the striking of the boat against the wharf on the Philadelphia side occurred under peculiar circumstances, and could not, perhaps, have been avoided by any diligence upon the part of the agents of the defendant.
When the evidence was concluded, and after the parties submitted their requests for instructions, the court delivered its charge upon the whole case, reading to the jury the instructions asked by either party that were approved, and accompanying them with such observations, by way of explanation or qualification, as it deemed necessary.
The third and fourth points submitted in behalf of plaintiff were overruled. They were as follows:
"Third. If the jury believe from the evidence that the defendants received the plaintiff as a passenger, and that they failed to provide her with a seat, or that she was unable to *476 obtain a seat by reason of the crowded condition of the boat, and while standing in the cabin she was, without any fault of her own, thrown down and injured by a sudden shock to the boat, then the defendants are guilty of negligence, and your verdict should be for the plaintiff.
"Fourth. If the jury believe from the evidence that the defendants received the plaintiff, a woman 67 years of age, as a passenger, and that they failed to provide her with a seat, or that she was unable to obtain a seat by reason of the crowded condition of the boat, and while standing in the cabin she was, without any fault of her own, thrown down and injured by a sudden shock to the boat, then the defendants were guilty of negligence, and your verdict should be for the plaintiff."
At the conclusion of the charge, the plaintiff, by counsel, excepted to the overruling of her third and fourth points, and, also, to "the charge and opinion" of the court. No other exceptions were taken.
1. The general exception to the charge did not direct the attention of the court to the particular portions of it to which the plaintiff objected. It, therefore, raises no question for review by this court. Connecticut Life Ins. Co. v. Union Trust Co., 112 U.S. 250, 261, and authorities there cited.
2. The only question for determination relates to the refusal of the court to instruct the jury as indicated by the third and fourth points of the plaintiff, which involve, substantially, the same proposition. Those points were properly overruled. Under the theory of the case which they present, the jury although the sudden shock to the boat, from which plaintiff's injuries immediately resulted, may have occurred without want of care or skill upon the part of the defendant's servants would have been required to find for the plaintiff, if the defendant failed to provide her with a seat, or if she was unable, by reason of the crowded condition of the boat, to obtain one. In other words, that the mere failure of the company to provide a seat for a passenger on its boat was, in law, and of itself, proof of negligence. It appeared in evidence that the boat was provided with seats; but it did not appear that a less number was provided than was customary and sufficient for those who *477 ordinarily preferred to be seated while crossing in ferry-boats between Camden and Philadelphia. No circumstances were disclosed that would have justified the jury in finding that a proper degree of care, upon the part of defendant, required it to provide seats sufficient for the accommodation of all the passengers that its boat could safely carry, or of such number of passengers as ordinarily travelled upon it.
The judgment is
Affirmed.
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901 F.Supp. 1349 (1995)
ROBERTS & SCHAEFER COMPANY, a Delaware corporation, Plaintiff,
v.
MERIT CONTRACTING, INC., a Pennsylvania corporation, Defendant.
No. 95 C 0217.
United States District Court, N.D. Illinois, Eastern Division.
September 29, 1995.
*1350 Robert J. Franco, II, Linda Urbanik Johnson, Bollinger, Ruberry and Garvey, Chicago, IL, for plaintiff.
Lawrence R. Moelmann, Hinshaw & Culbertson, Chicago, IL, for defendant.
MEMORANDUM OPINION AND ORDER
BUCKLO, District Judge.
Plaintiff, Roberts & Schaefer Company ("R & S"), filed a complaint against defendant, Merit Contracting, Inc. ("Merit"), in the Circuit Court of Cook County on December 28, 1994. On January 12, 1995, Merit removed the action to this court pursuant to 28 U.S.C. § 1441 on the basis of diversity of citizenship.
R & S is a contractor incorporated in Delaware with its principal place of business in Chicago, Illinois. Merit is a Pennsylvania corporation and has its principal place of business in Monongahela, Pennsylvania. In summer 1993, R & S accepted Merit's bid to complete work in connection with the demolition, excavation, foundations and erection of a raw coal storage and handling facility at the Eighty-Four Mining Company in Pennsylvania. In September 1993, R & S sent Merit a letter confirming its purchase order relating to the work, and Merit began the job. R & S claims that during the project, disputes arose between the parties regarding delays which increased costs and postponed completion dates. R & S alleges that Merit has not submitted to R & S waivers of lien along with its invoices and has informed the owner of the Eighty-Four Mining Company of its intention to file a lien against the owner and the property for work performed under the purchase order but for which R & S has *1351 not paid. As a result, the owner is withholding payments from R & S. R & S asserts that Merit's actions have breached the parties' contract and injured R & S.
Merit has filed a motion to dismiss or, in the alternative to transfer or stay the proceedings. In response, R & S has filed a motion to remand the case to the circuit court. For the following reasons, R & S' motion is denied, and Merit's motion to dismiss is granted on the basis that this court does not have personal jurisdiction over Merit.
Whether this Action was Properly Removed
28 U.S.C. § 1441 permits a defendant to remove an action from state court to federal court if the federal court would have had jurisdiction over the lawsuit as originally filed by the plaintiff. Merit, as the party seeking to preserve removal, has the burden of establishing that this court has jurisdiction over the present case. Casey v. Hinckley & Schmitt, Inc., 815 F.Supp. 266, 267 (N.D.Ill. 1993). Remand to the state court is necessary if I decide that jurisdiction is lacking. Id. District judges may remand a removed case to state court based either on statutory grounds under 28 U.S.C. § 1447(c) or for non-statutory, common law reasons. Rothner v. City of Chicago, 879 F.2d 1402, 1406, 1410-11, 1416 (7th Cir.1989). Non-statutory grounds include the application of contract law to enforce forum selection clauses under the reasoning that defendants who have agreed to such clauses have, in effect, waived their removal rights. See e.g. Colonial Bank & Trust v. Cahill, 424 F.Supp. 1200, 1204 (N.D.Ill.1976); Foster v. Chesapeake Insurance Company, Ltd., 933 F.2d 1207, 1215-1218 (3d Cir.1991); Pelleport Investors v. Budco Quality Theatres, Inc., 741 F.2d 273, 279-81 (9th Cir.1984) (cited by Rothner v. City of Chicago, supra, 879 F.2d at 1416); Karl Koch Erecting Co., Inc. v. New York Convention Center Development Corporation, 838 F.2d 656, 659 (2d Cir.1988).[1]
R & S nevertheless argues that Merit waived its right to remove this lawsuit to federal court by agreeing to the following forum selection clause:
This purchase order and all disputes between the parties hereto shall be governed by and construed according to the laws of Illinois whose Circuit Courts shall have exclusive jurisdiction to determine all such issues.
R & S Memo., Ex. A, p. 113. Courts have remanded cases involving similar forum selection clauses to state court. See e.g. Pelleport Investors v. Budco Quality Theatres, Inc., supra, 741 F.2d at 275, 280; Karl Koch Erecting Co., Inc. v. New York Convention Center Development Corporation, supra, 838 F.2d at 659. Before reaching the issue of whether this particular forum selection clause waived Merit's removal rights, it is necessary to determine whether this clause was part of the agreement between R & S and Merit.
In order to form a contract, each party must assent, and the essential terms must be definite and certain. Soderholm v. Chicago National League Ball Club, Inc., 225 Ill.App.3d 119, 587 N.E.2d 517, 519, 167 Ill.Dec. 248, 250 (1st Dist.1992); Bielecki v. Painting Plus, Inc., 264 Ill.App.3d 344, 637 N.E.2d 1054, 1061, 202 Ill.Dec. 318, 325 (1st Dist.1994). Furthermore, "a course of conduct may act as consent to a contract, [but] it must be clear exactly what contract the conduct relates to." Lundin v. Egyptian Construction Co., Inc., 29 Ill.App.3d 1060, 331 N.E.2d 208, 211 (1st Dist.1975).
R & S and Merit agree that R & S accepted Merit's bid to complete work for a project at the Eighty-Four Mining Co. R & S sent a confirming letter to Merit on September 7, 1993 stating that it had issued purchase orders for Merit to complete certain construction services at the Eighty-Four Mining Co. for a price of $1,775,000.00 as well as electrical work for $265,000,000. R & S Memo., Ex. A, p. 164. This letter indicates R & S' acceptance of Merit's bid and the parties' *1352 agreement that Merit would perform particular work for a specific price. Id.; Merit's Memo., Ex. A to Ex. D. The parties' agreement to these essential terms formed a contract. See B & C Electric, Inc. v. Pullman Bank and Trust Company, 96 Ill.App.3d 321, 421 N.E.2d 206, 210, 51 Ill.Dec. 698, 702 (1st Dist.1981); Bielecki v. Painting Plus, Inc., supra, 202 Ill.Dec. at 326, 637 N.E.2d at 1062. Merit commenced work on the project in September, and on September 30th sent R & S the first invoice in the amount of $154,620.00, which R & S subsequently paid in full. Merit Aff. ¶¶ 8, 9.
On November 1, 1993, R & S sent to Merit Purchase Order No. 9331-711 and other documents relating to the Eighty-Four Mining Co. project. R & S argues that the "Roberts and Schaefer Company Construction General Notes & Conditions" ("General Notes & Conditions"), R & S Memo., Ex. A, pp. 92-131, which contained the forum selection clause, was sent to Merit at this time and became part of its contract with Merit. However, Merit's affidavit, uncontradicted by any opposing affidavit, deposition or other evidence from R & S, states that "[n]o one from Merit signed [the documents forwarded on November 1, 1993] because the terms were unacceptable and did not represent the parties' agreement." Merit Aff. ¶ 10.
R & S has submitted no evidence that would support its position that the parties' agreement contained the General Notes & Conditions.[2] The General Notes & Conditions do not include a date, either party's signature, the purchase order number (9331-711) or any description of the job (e.g., "Eighty-Four Mining Co."). The document uses the generic terms "subcontractor" and "seller" and does not identify Merit as such. Furthermore, none of the documents R & S cites to in its briefs as comprising its contract with Merit incorporate the General Notes & Conditions by reference.
R & S argues that even if Merit never signed the contract documents it accepted the terms of the contract through its actions. It relies on Amelco Electric Co., Inc. v. Arcole Midwest Corp., 40 Ill.App.3d 118, 351 N.E.2d 349 (1st Dist.1976) and Landmark Properties, Inc. v. Architects International-Chicago, 172 Ill.App.3d 379, 526 N.E.2d 603, 122 Ill.Dec. 344 (1st Dist.1988), in support of its position.
In Amelco, supra, 351 N.E.2d at 351, the subcontract documents contained a document labeled as an appendix which related to "estimated manhours to be worked by minority persons" and was to be completed and signed by the plaintiff for transmittal to the City of Chicago. The plaintiff did execute the necessary papers "and on eight separate days plaintiff submitted written contractor's reports to the City in accordance with the written agreement." Id. 351 N.E.2d at 354. Thus, the evidence in Amelco demonstrated that the plaintiff acted to carry out at least some of the written terms of the proposed subcontract. In this case, there is no evidence that Merit acted on any specific written term contained in the General Notes & Conditions or any particular document (other than the letter confirming R & S' acceptance of Merit's bid).
Moreover, in Amelco, the parties apparently agreed that the proposed subcontract was comprised of a discrete set of documents, which contained the term (a specific waiver of mechanics' lien) that the plaintiff was found to have accepted through its conduct. Id. 351 N.E.2d at 352-53. In this case, the parties have not agreed on exactly what documents constituted the proposed subcontract. Unlike the Amelco court which found that *1353 the relevant term was in the proposed subcontract, I cannot conclude that the term at issue, found in the General Notes & Conditions which contains the forum selection clause, was part of the proposed subcontract here.
The court in Landmark Properties concluded that a party who never signed an architect's American Institute of Architects ("AIA") contract was nevertheless bound by its provisions because the party informed the architect that payment would be forthcoming provided all services were performed "in accordance with the AIA contract" and, in addition, filed a submission (later withdrawn) to mediation under the AIA contract. Landmark Properties, Inc. v. Architects International-Chicago, supra, 526 N.E.2d at 606. Although R & S argues that Merit engaged in similar conduct indicating acceptance in this case, there is no evidence to support its contention.
R & S apparently maintains that Merit's reference to a "force majeure situation" in its letter of October 12, 1993 indicates Merit's agreement to the General Notes & Conditions since the phrase "force majeure" is found in paragraph 6.8 of that document. R & S Memo., Ex. A, pp. 73, 111. I cannot agree. Merit wrote the letter to notify R & S of a "force majeure situation" which caused Merit to cease work. The force majeure clause in the General Notes & Conditions does not relate to force majeure circumstances encountered by Merit but only to the effect of such circumstances on R & S:
In the event of causes beyond the control of Buyer [i.e., R & S], including but not limited to acts of God, fire, the elements, strikes or labor disputes, and accidents or transportation difficulties, which would make it unreasonable in Buyer's judgment to accept delivery hereunder, Buyer shall have the option to cancel this purchase order or to delay the delivery or completion of all or part of the items, such cancellation or delay being without cost to Buyer.
R & S Memo., Ex. A, p. 111.
R & S also attempts to show that the General Notes & Conditions were incorporated into the parties' agreement via their January 27, 1994 Agreement discussing "General Conditions" in the following manner:
All additional General Conditions including supervision, etc., required due to this accelerated and extended schedule inclusive of overtime, will be charged by Merit to R & S.
R & S Memo., Ex. A, p. 172. The phrase "General Conditions" is clearly different from "Roberts & Schaefer General Notes & Conditions."
R & S' additional contention that some of the purchase orders sent by R & S to Merit stated "[t]erms and conditions shown on Roberts & Schaefer P.O. # 9331-711 will apply" does not establish Merit's agreement to the General Notes & Conditions since the General Notes & Conditions document was not "shown on" purchase order no. 9331-711 or referenced by any of the items listed in that purchase order which have been submitted to the court.
In summary, R & S has failed to provide any evidence showing that Merit signed the General Notes & Conditions or agreed to the particular terms of that document through its actions. R & S has not rebutted Merit's sworn statement that Merit did not accept the terms of the papers sent it on November 1, 1993 (which allegedly included the General Notes & Conditions) and did not sign them. Accordingly, based on the evidence before the court, the contract between R & S and Merit did not contain the General Notes & Conditions, which includes the forum selection clause.[3] Because I find that the forum selection clause has not been shown to be a term of the parties' agreement, remand to the circuit court based on this clause is not warranted.
*1354 Whether this Court has Personal Jurisdiction over Merit[4]
Jurisdiction in this case is based on diversity of citizenship. A federal district court in Illinois has personal jurisdiction over a party involved in a diversity action only if an Illinois state court would have personal jurisdiction. Michael J. Neuman & Associates, Limited v. Florabelle Flowers, Incorporated, 15 F.3d 721, 724 (7th Cir.1994). The burden of proving jurisdiction over a nonresident defendant rests with the plaintiff. Publications International Ltd. v. Simon & Schuster, Inc., 763 F.Supp. 309, 310 (N.D.Ill. 1991); Wysnoski v. Millet, 759 F.Supp. 439, 442 (N.D.Ill.1991) (citing Saylor v. Dyniewski, 836 F.2d 341, 342 (7th Cir.1988)). In deciding a motion to dismiss for lack of personal jurisdiction, I am obliged to accept all of the facts alleged by R & S in its complaint and not denied by Merit and to resolve all factual disputes in favor of R & S, the party seeking to establish jurisdiction. Diamond Mortgage Corporation of Illinois v. Sugar, 913 F.2d 1233, 1245 (7th Cir.1990) (citing Saylor v. Dyniewski, supra, 836 F.2d at 342); Deluxe Ice Cream Company v. R.C.H. Tool Corp., 726 F.2d 1209, 1215 (7th Cir.1984) (citations omitted).
In the past, a non-resident defendant was subject to suit in Illinois only if she (1) performed one of the enumerated acts in the Illinois long-arm statute; and (2) had the minimum contacts with Illinois required by the due process guarantee. Mors v. Williams, 791 F.Supp. 739, 741 (N.D.Ill.1992) (citing FMC Corp. v. Varonos, 892 F.2d 1308, 1310 (7th Cir.1990)). As of September, 1989, however, the Illinois long-arm statute has included a "catch-all" provision, stating that
[a] court may also exercise jurisdiction on any other basis now or hereafter permitted by the Illinois Constitution and the Constitution of the United States.
735 ILCS 5/2-209(c). This "catch-all" provision makes contiguous the parameters of jurisdiction under the Illinois long-arm statute and the requirements of due process under the United States and Illinois constitutions and, therefore, renders unnecessary an inquiry as to whether the defendant performed one of the enumerated acts under the long-arm statute. Dehmlow v. Austin Fireworks, 963 F.2d 941, 945 (7th Cir.1992); Chemical Waste Management, Inc. v. Sims, 870 F.Supp. 870, 873 (N.D.Ill.1994) (and cases cited therein). Accordingly, to resolve Merit's motion to dismiss based on lack of personal jurisdiction, I will determine whether exercising jurisdiction over Merit would satisfy the due process guarantees of the United States and Illinois Constitutions. See Chemical Waste Management, Inc. v. Sims, supra, 870 F.Supp. at 873.
Federal due process requires an Illinois court to exercise jurisdiction over a defendant who has "certain minimum contacts with [Illinois] such that the maintenance of the suit does not offend `traditional notions of fair play and substantial justice.'" Michael J. Neuman & Associates, Limited v. Florabelle Flowers, Incorporated, supra, 15 F.3d at 725 (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945)). A defendant who "purposefully avails himself of the privilege of conducting activities within the forum state" satisfies this test. Dehmlow v. Austin Fireworks, supra, 963 F.2d at 946 (citations omitted). Courts must consider foreseeability whether the defendant's contacts with the forum state are such that he could have anticipated being haled into court in that state. Heritage House Restaurants v. Continental Funding, 906 F.2d 276, 283 (7th Cir. 1990).
The parties agree that Merit is a Pennsylvania corporation and has its principal place of business in Monongahela, Pennsylvania. R & S' complaint does not contain any allegations connecting Merit to Illinois. Merit's uncontradicted affidavit asserts that Merit does some work in Ohio, West Virginia and Maryland but that "Merit has never engaged in or solicited business in the State of Illinois and owns no personal or real property in Illinois." Merit Aff. ¶ 3. Moreover, Merit dealt with R & S exclusively through its *1355 office in Monroeville, Pennsylvania. Id.[5] For example, Merit sent an invoice in the amount of $154,620.00 for services rendered in September, 1993 to R & S at its Pennsylvania office, and R & S issued Merit payment of the amount invoiced from that office. Merit Aff. ¶¶ 8, 9. The "Construction Documents" contained in Exhibit A to R & S' memorandum of law list R & S' Pennsylvania address rather than its Illinois address. The only evidence before me therefore shows that Merit does not have any, let alone minimum, contacts with Illinois. Accordingly, haling Merit into an Illinois court would violate the due process clause of the United States Constitution. See Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476, 105 S.Ct. 2174, 2184, 85 L.Ed.2d 528 (1984).
Conclusion
For the foregoing reasons, R & S' motion to remand to the state court is denied, and Merit's motion to dismiss for lack of personal jurisdiction is granted.[6]
NOTES
[1] R & S does not argue that removal was improper for lack of diversity jurisdiction. R & S and Merit are of diverse citizenship, and R & S does not contest Merit's allegation that the amount in controversy exceeds $50,000.00. Accordingly, Merit's removal to federal court based on diversity jurisdiction is appropriate. See 28 U.S.C. § 1332.
[2] The record before me consists of the complaint with its attachments, which included the purchase order sent by R & S on November 1, 1993, various change orders and a second purchase order; a praecipe for writ of summons in the Pennsylvania action and the complaint in that action; and the affidavit of Merit's president, with attachments. In ascertaining whether removal is proper, the court may examine the record as a whole. Casey v. Hinckley & Schmitt, Inc., 815 F.Supp. 266, 267 (N.D.Ill.1993). R & S has referred in its brief in support of its motion to remand to various exhibits neither attached to the complaint nor supported by affidavit. Nevertheless, even if all of those documents are considered, there is no evidence to support R & S's argument.
[3] R & S apparently argues that a determination that the parties' agreement did not include the General Notes & Conditions in effect finds that the agreement had no terms and conditions. I disagree. The parties may have agreed to terms other than those in the General Notes & Conditions, such as those on the back of the purchase order or in the document titled "scope of work." Whether or not they did is a question for another day.
[4] Merit's removal of this action from state to federal court did not waive its objection to in personam jurisdiction. Allen v. Ferguson, 791 F.2d 611, 614 (7th Cir.1986).
[5] The unsigned subcontract agreement attached to R & S' complaint states:
As the Work progresses ninety percent (90%) of the value of the completed Work done from month to month, shall be paid to the Subcontractor within ten (10) days of the receipt thereof by the Contractor from the Owner, provided, that a separate requisition for labor and material on a form supplied by the Contractor be delivered to the offices of the Contractor at 120 S. Riverside Plaza, Chicago, Illinois 60606 not later than the 25th day of the month during which the work covered thereby was done....
Complaint, Ex. A, p. 117. Paragraph 3 of Merit's affidavit sufficiently denies that it dealt with R & S' office in Chicago. To create a factual dispute on this issue, R & S was obligated to submit evidence such as an affidavit or deposition, which it did not.
[6] My decision that this court lacks personal jurisdiction over Merit renders unnecessary a resolution of Merit's remaining motions.
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NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
__________
No. 15-1516
__________
MARYLYNN HARTSEL;
DEANNA PARKER, derivatively on behalf of
Nominal Defendants, Vanguard International
Equity Index Funds d/b/a Vanguard European
Stock Index Fund, and Vanguard Horizon Funds
d/b/a Vanguard Global Equity Fund,
Appellants
v.
VANGUARD GROUP INC.; JOHN J. BRENNAN;
CHARLES D. ELLIS; RAJIV L. GUPTA; AMY GUTMANN;
JOANN HEFFERNAN HEISEN; ANDREW F. PEROLD;
ALFRED M. RANKIN, JR.; J. LAWRENCE WILSON;
ACADIAN ASSET MANAGEMENT LLC; MARATHON ASSET
MANAGEMENT LLP; VANGUARD INTERNATIONAL
EQUITY INDEX FUNDS d/b/a Vanguard European Stock
Index Fund; VANGUARD HORIZON FUND
d/b/a Vanguard Global Equity Fund
__________
On Appeal from the United States District Court
for the District of Delaware
(Civ. No. 1-13-cv-01128)
District Judge: Sue L. Robinson
Submitted Under Third Circuit LAR 34.1(a)
December 10, 2015
BEFORE: FUENTES, CHAGARES, and GREENBERG Circuit Judges
(Filed: May 4, 2016)
__________
OPINION*
__________
Fuentes, Circuit Judge:
Plaintiffs, Maryanne Hartsel and Deanna Parker, brought this derivative action
against several individuals, investment advisors, and investment funds.1 They allege that
certain mutual funds in which they owned shares suffered millions of dollars in losses as
a result of Defendants’ investment in illegal online gambling operations. The District
Court dismissed Plaintiffs’ claims for negligence, breach of fiduciary duty, breach of
contract, and corporate waste. For the reasons that follow, we will affirm.
I. BACKGROUND AND PROCEDURAL HISTORY2
Some people gamble in casinos, while others place their bets on the stock
exchange. The issues involved in this case arose out of both worlds. Section 1955 of the
Illegal Gambling Business Act, makes it unlawful to own “all or part of an illegal
*
This disposition is not an opinion of the full Court and pursuant to I.O.P. 5.7 does not
constitute binding precedent.
1
The individual Defendants are John J. Brennan (“Brennan”), Charles D. Ellis (“Ellis”),
Rajiv L. Gupta, Amy Gutmann, JoAnn Heffernan Heisen, Andre F. Perold, Alfred M.
Rankin, Jr., and J. Lawrence Wilson (“Wilson”), as well as Acadian Asset Management,
LLC (“Acadian”), Marathon Asset Management, LLP (“Marathon”) and The Vanguard
Group, Inc. (“Vanguard”). The Nominal Defendants are Vanguard International Equity
Index Funds d/b/a Vanguard European Stock Index Fund, and Vanguard Horizon Funds
d/b/a Vanguard Global Equity Fund.
2
The District Court had subject matter jurisdiction under 28 U.S.C. §§ 1331 and 1332.
We have jurisdiction under 28 U.S.C. § 1291.
2
gambling business.”3 In 2006, the U.S. Department of Justice and various state law
enforcement officials initiated a crackdown, which led to the arrests and prosecutions of
various individuals that owned and operated the illegal gambling operations. Many of the
illegal operations were located offshore and issued public shares on foreign stock
exchanges. Prior to the crackdown, Plaintiffs claim that Defendants, investment advisers
and former Trustees of the mutual funds (the “Funds”), bought, on behalf of the Funds,
shares in the illegal offshore gambling companies.4 Plaintiffs contend that these
investments violated Section 1955 and constituted a breach of fiduciary duty.5
After the crackdown, share values in gambling operations plummeted. Plaintiffs
allege that Defendants, despite knowing of the crackdown, increased the Funds’
ownership of the illegal gambling businesses at that time. As a result, they allege that the
Funds suffered millions of dollars in losses.
3
18 U.S.C. § 1955.
4
The operations were Sportingbet PLC, Partygaming Plc, bwin Interactive Entertainment
AG, and NETeller Plc.
5
Prior to the crackdown, in 2003 the U.S. Department of Justice issued a warning to the
public that “[i]nternet gambling and offshore sportsbook operations that accept bets from
customers in the United States violate Sections 1084, 1952, and 1955 of [Title] 18 of the
United States Code, each of which is a Class E felony. [A]ny person or entity who aids
or abets in the commission of any of the above-listed offenses is punishable as a principal
violator.” (App. at A-48, ¶ 73.) Moreover, 18 U.S.C. § 1955 (b)(1)(ii) defines, the term
“illegal gambling business” as involving “five or more persons who conduct, finance,
manage, supervise, direct, or own all or part of such business.” Thus, as the District
Court correctly interpreted the Amended Complaint, Plaintiffs allege that Defendants, by
virtue of the investments, caused the Funds to become “part owners” in the illegal
gambling businesses in violation of Section 1955.
3
Plaintiffs originally sought to recover their losses by filing a complaint in U.S.
District for the Southern District of New York in 2008, alleging that Defendants’ conduct
violated the Racketeer Influenced and Corrupt Organizations Act, RICO, 18 U.S.C. §
1961-68.6 The complaint also included common law claims for breach of fiduciary duty,
negligence, and waste.7 Judge Denise Cote dismissed the complaint with prejudice for
lack of RICO causation and declined to exercise supplemental jurisdiction over the state
law claims. The Second Circuit affirmed, and the Supreme Court denied certiorari.8
Plaintiffs then brought another action in the Delaware Court of Chancery in
Hartsel v. The Vanguard Group, Inc., 2011 WL 2421003 (Del. Ch. June 15, 2011)
(hereafter referred to as “Hartsel I”), alleging both derivative and direct claims based on
the same alleged illegal conduct. Plaintiffs did not make a demand on the Fund’s Board
of Trustees and instead argued demand futility. The Chancery Court dismissed the
complaint for failure to make a timely demand on the Board and failure to allege
cognizable claims.9
Plaintiffs thereafter made a demand on the Board before the expiration of the one-
year period provided under the Delaware Savings Statute (the “Savings Statute”), which,
6
McBrearty v. The Vanguard Group, Inc., 2009 WL 875220, at *1 (S.D.N.Y. Apr. 2,
2009).
7
Id. at *4.
8
McBrearty v. The Vanguard Group, Inc., 353 F. App’x. 640, 642 (2d Cir. 2009);
McBrearty v. The Vanguard Group, Inc., 560 U.S. 979 (2010).
9
Hartsel v. The Vanguard Group, Inc., 2011 WL 2421003, *23, *26-27 (Del. Ch. June
15, 2011).
4
in certain circumstances, tolls the statute of limitations for claims that are dismissed on
purely procedural or technical grounds.10 The Board thereafter formed a Special
Litigation Committee (“SLC”) but did not respond to the demand for over a year. In the
interim, seeking to preserve their claims as timely under the Savings Statute, Plaintiffs
sued again, this time in U.S. District Court for the District of Delaware, asserting claims
of negligence, waste, breach of contract, and breach of fiduciary duty. After amending
the Complaint, Plaintiffs also alleged that the Board and SLC purposefully postponed a
decision with the intent of allowing the statute of limitations to expire. Shortly after
Plaintiffs filed the Amended Complaint, the SLC recommended that the Board reject
Plaintiffs’ demand, and the Board accepted that recommendation.
Defendants moved to dismiss the Amended Complaint under Fed. R. Civ. P.
12(b)(6), arguing that Plaintiffs claims were time-barred. In opposition, Plaintiffs argued
that, even though the three year statute of limitations governing their claims had run, the
claims were preserved under the Savings Statute. To support this claim, Plaintiffs argued
that the dismissal in the Chancery Court in Hartsel I for failure to make a demand on the
board was entirely a “matter of form.” The District Court granted Defendants’ motion to
10
All of Plaintiffs’ claims are governed by a three year statute of limitations under
Delaware law. See 10 Del. C. §§ 8112 and 8106. The Delaware Savings Statute
(“Savings Statute”), 10 Del. C. § 8118(a), “provides exceptions to the applicable statute
of limitations in certain instances where the plaintiff has filed a timely lawsuit, but is
procedurally barred from obtaining a resolution on the merits.” Reid v. Spazio, 970 A.2d
176, 180 (Del. 2009).
5
dismiss, concluding that the Savings Statute did not apply to preserve Plaintiffs’ claims
and that they were therefore time-barred.11 This appeal followed.
II. DISCUSSION
First, Plaintiffs contend that the District court erred by finding that their claims
were time-barred.12 As the District Court observed, where a timely action is dismissed on
certain technical grounds after the statute of limitations has run, the Savings Statute
grants the plaintiff one year beyond final dismissal to refile the action.13 Here, in
concluding that Plaintiffs’ previous claims were dismissed on the merits, the District
Court correctly noted that, “the entire question of demand futility is inextricably bound to
issues of business judgment and the standard of that doctrine’s applicability.”14
Moreover, we have stated that “federal courts hearing shareholders’ derivative actions
involving state law claims apply the federal procedural requirement of particularized
pleading, but apply state substantive law to determine whether the facts demonstrate
[that] demand would have been futile and can be excused.”15 In consequence, we
conclude that Plaintiffs cannot now characterize their failure to plead adequately demand
11
Plaintiffs filed the present action almost two years after the statute of limitations
governing their claims expired.
12
We apply de novo review to a district court’s dismissal of a complaint under Rule
12(b)(6). Phillips v. Cnty. of Allegheny, 515 F.3d 224, 230 (3d Cir. 2008).
13
10 Del. C. § 8118(a).
14
Aronson v. Lewis, 473 A.2d 805, 812 (Del. 1984), overruled on other grounds by
Brehm v. Eisner, 746 A.2d 244 (Del. 2000).
15
Kanter v. Barella, 489 F.3d 170, 176 (3d Cir. 2007).
6
futility as “a matter of form” or mere technicality because their actions involved a
question of pure legal strategy.16 The District Court therefore properly determined that
the claims were time-barred.
In dismissing the Amended Complaint, the District Court also addressed the
Board’s decision to reject the demand under Delaware’s business judgment rule and
concluded that the Board’s conduct was not inconsistent with the rule. The court found
that the Board had not abdicated its authority by failing to render a decision or enter into
a tolling agreement. The court also held that the mere passage of time, without any
allegation of bad faith, is insufficient indicia of wrongful refusal. Finally, the court
rejected Plaintiffs’ argument that demand was wrongfully refused because the Board
denied Plaintiffs’ request to participate in the investigation.
In Delaware, the business judgment rule is a presumption that directors act in good
faith, on an informed basis, honestly believing that their action is in the best interests of
the company.17 Contrary to Plaintiffs’ contention here that the Board abdicated its
authority to decide Plaintiffs’ demand, the District Court properly concluded that
16
At least one Delaware Superior Court has stated that “avoiding or defeating” the action
for a “matter of form” is “directed toward instances such as lack of jurisdiction or filing
in the wrong venue.” O’Donnell v. Nixon Unif. Serv., Inc., No. CIV.A. 01C-10-291RRC,
2003 WL 21203291, at *5 (Del. Super. Ct. May 20, 2003), aff'd sub nom., O’Donnell v.
Lilly, 836 A.2d 514 (Del. 2003). This decision further supports the District Court’s
proper determination that the Savings Statute does not apply to save claims where, as
here, plaintiffs have made a strategic legal decision to forgo making a demand on the
Board.
17
Aronson v. Lewis, 473 A.2d 805, 812 (Del. 1984), overruled on other grounds by
Brehm v. Eisner, 746 A.2d 244 (Del. 2000).
7
Plaintiffs failed to allege that the investigation into their claims was unreasonable or that
the Board’s refusal was made in bad faith. Moreover, we agree with the District Court’s
determination that the Board “was not required to continuously inform plaintiff of
developments in the investigation” and was entitled to reserve final decision-making
authority.18 In short, Plaintiffs failed to show that the investigation was unreasonable or
that the Board’s conduct was otherwise inconsistent with the business judgment rule.
Finally, Plaintiffs argue that the Board had an irreconcilable conflict of interest
because the Board of the Funds was identical to that of Vanguard, the Funds’ investment
advisor. Plaintiffs therefore claim that the Board members were unable to independently
evaluate Plaintiffs’ demand. The District Court held that this argument was a mere
reiteration of the “conflict of interest” argument that Plaintiffs asserted in Hartsel I to the
Delaware Chancery Court, which it rejected. The District Court thus declined to revisit
the issue. We agree with the District Court and conclude that Plaintiffs were collaterally
estopped from raising the conflict of interest argument.19 Moreover, the District Court
18
Gamoran v. Neuberger Berman, LLC, No. 11 CIV. 07957 TPG, 2013 WL 1286133, at
*5 (S.D.N.Y. Mar. 29, 2013), aff’d in part, vacated in part, 536 F. App’x 155 (2d Cir.
2013).
19
Under the doctrine of collateral estoppel, “where a question of fact essential to the
judgment is litigated and determined by a valid and final judgment, the determination is
conclusive between the same parties in a subsequent case on a different cause of action.
In such situation, a party is estopped from relitigating the issue again in the subsequent
case.” Columbia Cas. Co. v. Playtex FP, Inc., 584 A.2d 1214, 1216 (Del. 1991) (citation
omitted). Here, Plaintiffs asserted the same “conflict of interest” argument in Hartsel I,
the same parties were involved in both cases, and the Chancery Court entered final
judgment. And, while the District Court did not engage in a collateral estoppel analysis,
we may affirm on any basis supported by the record. See Fairview Twp. v. EPA, 773 F.2d
517, 525 n.15 (3d Cir. 1985). Here, the record supports our conclusion.
8
properly concluded that Plaintiffs have offered no facts that members of the Board were
interested or that the Board otherwise failed to carry out its fiduciary duties.
III. CONCLUSION
For substantially the same reasons set forth in the District Court’s thorough and
persuasive opinion, we affirm the judgment of the District Court.
9
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457 F.Supp. 322 (1978)
Elizabeth WILLIAMS
v.
Stanley BASHMAN, Spencer M. Wertheimer and Harold M. Kane, Individually and trading as Bashman, Wertheimer & Kane and Michael Radbill.
Civ. A. No. 77-2243.
United States District Court, E. D. Pennsylvania.
September 12, 1978.
*323 *324 George J. O'Neill, Philadelphia, Pa., for plaintiff.
Theodore Flowers, White & Williams, Philadelphia, Pa., for defendants.
ADJUDICATION
JOSEPH S. LORD, III, Chief Judge.
The plaintiff in this legal malpractice case alleges that she was injured in 1973 when she caught her foot in an uncovered vent pipe on a sidewalk and that shortly thereafter she entered into a contract with the defendant law firm to represent her in a personal injury case against the City of Philadelphia and the owner of the property on whose sidewalk she had fallen. She asserts that the defendant's negligence in failing to initiate an action against the city and the property owner or otherwise to protect her legal interests precluded her from recovering damages in a personal injury suit. The plaintiff claims as damages the lost potential recovery in that personal injury case and additional pain and suffering caused by the defendant's negligence. After a non-jury trial, I make the following findings and conclusions.
FINDINGS OF FACT
1. The plaintiff is a citizen of South Carolina. The defendant was in 1973 and 1974 a partnership engaged in the practice of law in Philadelphia, Pennsylvania. All the partners in that firm are citizens of states other than South Carolina.
2. Between 6:00 and 7:00 P.M. April 27, 1973, the plaintiff was walking on the sidewalk on the south side of the 2700 block of West Allegheny Avenue in Philadelphia. While she was passing the house at 2730 West Allegheny Avenue, she stepped in a hole on the sidewalk, caught her foot in that hole and fell on her right elbow and wrist.
3. The hole in which the plaintiff caught her foot was a vent pipe, four to six inches in diameter, whose cover was missing and which was surrounded by crumbled sidewalk. The sidewalk around the vent was depressed several inches below the general sidewalk level. At the time of the plaintiff's fall, it was dark and raining, and the pipe and depression around it were filled with water.
4. In stepping in a hole under those conditions, the plaintiff did not fail to exercise reasonable care.
5. The pipe cover had been missing, or at least its connection to the pipe had been noticeably loosened, before April 26, 1973.
6. The house at 2730 West Allegheny Avenue was owned by James M. Williford at the time of the accident. Williford passed by the vent every day as he entered and left the house. He first noticed that the vent cover was missing not before the morning of April 29, 1973, two days after the plaintiff was injured. He put a new cover on the pipe later that day.
7. Before he replaced the pipe cover, Williford took no steps to repair the hole or to warn pedestrians of the danger it presented.
8. The City of Philadelphia took no steps at any time either to remove the danger *325 created by the uncovered pipe or to warn pedestrians of the danger it presented.
9. A missing or loose cover to a vent pipe posed a danger to pedestrians using the sidewalk at 2730 West Allegheny Avenue.
10. At the time the plaintiff was injured, Williford was not aware that the cover was missing.
11. At the time the plaintiff was injured, Williford would have known the pipe cover was missing or dangerously loose had he exercised reasonable care, in light of his testimony that he passed by the vent several times a day.
12. By failing to repair this dangerous condition in the sidewalk or to warn pedestrians of the danger it posed to them by the time plaintiff was injured, Williford failed to exercise reasonable care.
13. At the time the plaintiff was injured, the City of Philadelphia did not know of the dangerous condition of the pipe, nor would it have known of any such condition had it exercised reasonable care.
14. The City of Philadelphia did not fail to exercise reasonable care in not repairing or warning pedestrians of this dangerous condition.
15. Plaintiff was aware by July 1973 that she might have had a cause of action against the property owner of the house at 2730 West Allegheny Avenue, Philadelphia, for any injuries she sustained as a result of the fall.
16. As a result of her fall on April 27, 1973, the plaintiff was treated for injuries to her left lower leg and foot, which were placed in a cast on the same day. The cast was changed on May 30, 1973, and was removed on June 24, 1973. The plaintiff had to use crutches until some time in September 1973.
17. Plaintiff's fall also was a substantial cause of pains to her arms as a result of using crutches and of pains to her right hip and upper and lower back. The hip and back pains were recurring, each approximately once a month, at the time plaintiff testified in this trial, nearly five years after her accident.
18. At the time she was injured, the plaintiff was employed by a nursing home as a licensed practical nurse. She earned $3.50 per hour and worked eight hours a day, from five to seven days a week. Since she did not establish, however, either the probability that she would have worked more than five days a week, or what the length of her average work week was, I find she worked a forty-hour week.
19. At the time of her injury, the plaintiff was on a leave of absence from her employment for medical reasons. That leave of absence had commenced in March 1973, and the plaintiff was scheduled to return to work in July 1973. She had taken leaves of absence from her job in 1970, 1971 and 1972 for medical reasons.
20. Plaintiff has been unable since April 27, 1973, to work as a licensed practical nurse.
21. Had she not suffered injuries in her fall on April 27, 1973, the plaintiff would have returned to work in the fall of 1973 but would have been able to work for only six more months, during which time she would have earned $3,640.
22. As a result of injuries suffered in her fall on April 27, 1973, the plaintiff has endured physical pain and suffering in the amount of $6,000.
23. In an action by plaintiff against Williford, she would not have been barred from recovery by contributory negligence. Williford had sufficient assets for the plaintiff to collect a judgment of $9,640 against him.
24. The plaintiff's claim against Williford and the City of Philadelphia would not have been resolved by settlement before the entry of judgment for the plaintiff.
25. In July 1973, three months after she was injured, the plaintiff retained Spencer M. Wertheimer, a partner in the defendant law firm, to represent her in her personal injury case. At that time the plaintiff entered into an agreement for representation by the defendant firm.
26. In the year after she entered into the agreement with the defendant firm, the *326 plaintiff attempted to contact Wertheimer to inquire about the status of her case. In July 1974 she received a letter from Michael Radbill, an employee of the defendant, informing her that he was representing her in her pending case. The plaintiff spoke to Radbill once after receipt of this letter. She continued to try to contact Wertheimer and Radbill, but most of her calls were not responded to or returned. In the plaintiff's only conversation with Wertheimer, he assured her that her case was in court and told her not to worry because it was being handled by the defendant.
27. At some time after July 1974 and before August 1976 the defendant partnership was dissolved.
28. The defendant law firm did not institute a personal injury action on plaintiff's behalf against the owner and/or occupant of the home at 2730 West Allegheny Avenue or the City of Philadelphia.
29. In failing to institute an action, a partner or partners and/or employee or employees of the defendant firm failed to exercise within the scope of their employment reasonable professional care and diligence in their representation of the plaintiff. By failing to institute a suit on behalf of the plaintiff, both Wertheimer and Radbill failed to exercise reasonable professional care and diligence in their representation of the plaintiff.
30. As a result of the negligence of the defendant law firm and of partners and/or employees of that firm in the scope of their employment and before the dissolution of the partnership, no suit was instituted on plaintiff's behalf against the owner and/or occupant of 2730 West Allegheny Avenue and/or the City of Philadelphia before April 27, 1975, and she has recovered no compensation for her injuries.
31. Plaintiff endured no mental suffering or anguish as a result of the defendant's negligence in failing to bring suit on her behalf.
32. At some time before August 30, 1976, the plaintiff filed a complaint as to the defendant's handling of her personal injury case with the Disciplinary Board of the Supreme Court of Pennsylvania. Plaintiff was informed for the first time that her personal injury claim would be barred by the statute of limitations when she received a letter from the Disciplinary Board dated September 21, 1976.
DISCUSSION
There are three factual issues raised in this case which seem to warrant brief discussion. All of them are dependent on the standard of proof imposed on a plaintiff in a legal malpractice case. The orthodox view, and indeed virtually the universal one, is that when a plaintiff alleges that the defendant lawyer negligently provided services to him or her as a plaintiff in the underlying action, he or she must establish by the preponderance of the evidence that he or she would have recovered a judgment in the underlying action in order to be awarded damages in the malpractice action, which are measured by the lost judgment. See, e. g., Christy v. Saliterman, 288 Minn. 144, 150, 179 N.W.2d 288, 294 (1970). While we know of no Pennsylvania case clearly establishing this standard with regard to the causation of damages, which requires in effect that a plaintiff prove the merits of the underlying case, we note that at least one commentator has interpreted this to be the law in Pennsylvania, Belden, Professional Liability of Lawyers in Pennsylvania, 10 Duquesne L.Rev. 317, 348 (1972), and in the light of its apparent ubiquity we will apply that standard here.
The first of the three factual issues is the actual or constructive notice of the property owner or the municipality that a dangerous condition existed on the sidewalk at the time the plaintiff was injured, which she would have had to have proved to prevail against either party in a personal injury suit.[1] When plaintiff retained the defendant *327 law firm, she placed in its collective hands the responsibility for her case, including undertaking discovery to determine the merits of her case and, if necessary, to prove the elements of her claim at trial. As a result of the defendant's negligence, apparently no such discovery was taken and there is only limited and circumstantial evidence as to when the dangerous condition on the sidewalk arose. As a result, the very negligence of defendant which is alleged here, and indeed is not seriously disputed, could become the defendant's staunchest tactical ally in defending an action based on that negligence. However, even applying the strict doctrine that plaintiff in a malpractice case must prove all the elements in the underlying cause of action, I conclude that the plaintiff has met her burden here because I find it more probable than not that the dangerous condition existed at least for some days before the plaintiff was injured and that the defendant property owner knew or should have known of this condition.
Plaintiff, of course, cannot point to the precise moment when the defect appeared. This is hardly surprising because by the very nature of the defect it is not one which occurred in a trice or in the wink of an eye; rather, it is one which resulted from a long, continued period of deterioration. The uncontradicted evidence shows that the pipe was filled with water and apparently clogged by debris, a condition which would be unlikely to occur in a pipe of that size within the space of a day; that a portion of the pipe covering was still attached to the top of the pipe, suggesting that the cover had been in the process of breaking for some time rather than being severed suddenly, e. g., by an act of vandalism; and that the pipe cover was not still in the immediate area.
The failure or the inability of the plaintiff to pinpoint the time the defect arose, is, of course, not fatal to her case. Stais v. Sears-Roebuck and Co., 174 Pa.Super. 498, 503, 102 A.2d 204, 206, aff'd, 378 Pa. 289, 106 A.2d 216 (1954). Were it otherwise, a plaintiff could rarely recover in a sidewalk falling case. Indeed, it is the nature of the defect that points to its long continued existence and which puts the defendant on constructive notice and therefore affixes liability. Williford, the owner of the property, testified that he passed by the vent pipe several times each day, that he first noticed the pipe was missing one morning and that he repaired it the same day. While I believe this testimony established that Williford did not have actual knowledge of the defect at the time the plaintiff was injured, I do not think it proves either the time the defect came into existence or the lack of constructive notice. Because of the nature of the defect, I have found that it existed for a substantial period before plaintiff's injury. Based on this finding, I must conclude that Williford would have known of this condition had he exercised reasonable care, particularly in light of his testimony that he passed the area several times each day. See Bacsick v. Barnes, 234 Pa.Super. 616, 622, 341 A.2d 157, 161 (1975). I further find that it was unreasonable for one with such knowledge not to take steps either to warn of this dangerous condition or to correct it.[2] In sum, I conclude that plaintiff fairly established Williford's liability on the underlying cause of action.
The plaintiff has claimed as one element of her damages lost wages for six years after she fell (i. e., until she reaches age 65), on the theory that this injury prevented her from working for that period. The defendant counters that she had already lost her job and no loss of earning capacity is attributable to the injury involved in the underlying cause of action. I find that the probable loss of earning capacity was somewhere between these two extremes and that the plaintiff would have returned to work but would have been able to continue providing services as a licensed *328 practical nurse for only six months in light of her other physical ailments. Consequently, the diminution in her earning capacity is measured by the loss of six months' wages, or $3,640.
Finally, I raised at trial the question of whether the plaintiff could recover in this case if I were to find that she would have settled out of court the underlying personal injury action against one or both defendants. The cases which both parties cited and those which I have found from other jurisdictions as well as from Pennsylvania are singularly uninstructive on this point, and I have found no authority expressly endorsing or rejecting the proposition that a plaintiff can recover in a legal malpractice case the settlement value of the underlying case. Fortunately, however, in view of my factual finding as to settlement, I need not decide the question at this time.
Ordinarily, the probability of settlement would be proved by expert testimony on the usual outcome of similar cases, including such factors as the merits of the case, the size of the award that the plaintiff might have received and whether the defendant in the underlying action would have been represented by counsel for an insurance company. The same expert or experts presumably would testify as to the settlement value of the underlying case. In this non-jury case, however, the parties stipulated to my competence to make an expert assessment of the probability and value of settlement in the personal injury action against the property owner and municipality. This trip-and-fall case, with a close question of the property owner's liability and a limited damage claim, is of a type ordinarily likely to end in settlement when brought against a defendant whose insurance company retains counsel. Here, however, there has been no showing that the property owner was insured and would have been represented by counsel from his insurer. In light of that vital gap, I am unable to conclude that the plaintiff would have been compensated through settlement with Williford. Therefore, it would be gratuitous for me now to decide whether, as a matter of law, the settlement value of the underlying action is recoverable in a legal malpractice action.
I find further that the possibility of the City of Philadelphia's liability in this case was so remote that it was not probable that the plaintiff would have received any compensation from it through settlement of her claim.
CONCLUSIONS OF LAW
1. Because there is complete diversity of citizenship and the amount in controversy exceeds $10,000, exclusive of interest and costs, the court has jurisdiction over the subject matter in this suit under 28 U.S.C. § 1332. The court also has jurisdiction over the parties in this suit.
2. The City of Philadelphia and Williford each had a duty to exercise reasonable care in keeping the sidewalk at 2730 West Allegheny Avenue free from defects which would endanger pedestrians.
3. The City of Philadelphia had neither actual nor constructive notice of any defects in that sidewalk as of April 27, 1973.
4. Williford did have constructive notice that the vent pipe cover was either missing or dangerously loose on the evening of April 27, 1973.
5. In not repairing or warning pedestrians of the dangerous condition as of April 27, 1973, Williford was negligent.
6. Williford's negligence was the proximate cause of the plaintiff's injury.
7. Plaintiff was not guilty of contributory negligence.
8. Williford would have been liable to the plaintiff for her loss in earning capacity and her pain and suffering, totalling $9,640. If her personal injury claim against Williford had been tried, the result of that trial would have been a verdict for the plaintiff in that amount.
9. If the plaintiff's personal injury claim against the City of Philadelphia had been tried, the result of that trial would have been a verdict for the City of Philadelphia.
*329 10. Beginning in July 1973, the defendant partnership and its partners and employees owed to the plaintiff a duty to exercise reasonable professional care in the prosecution of her personal injury claim against Williford and the City of Philadelphia.
11. The defendant partnership's partners and employees negligently breached the duty of care they owed to the plaintiff.
12. As a result of their negligence, the partners and employees of the defendant partnership failed to institute a personal injury claim on behalf of plaintiff against Williford and the City of Philadelphia on or before April 27, 1975. On that date the plaintiff's personal injury claim was barred by the Pennsylvania statute of limitations. 12 Pa.Stat.Ann. § 34.
13. The negligence of the defendant partnership's partners and employees was the proximate cause of the plaintiff's loss of a verdict against Williford in the amount of $3,640 for lost earning capacity and $6,000 for pain and suffering.
14. The defendant partnership is liable to plaintiff for the professional malpractice of its partners and employees in the amount of $9,640.
15. By failing to render to plaintiff reasonable professional services, defendant breached its contract with her.
16. The consequential damages recoverable by plaintiff for defendant's breach of contract are equal to the amount of the judgment she would have received had the defendant performed and brought suit in her behalfi. e., the verdict she would have received in her personal injury action, $9,640.
NOTES
[1] I note preliminarily that this case illustrates the hardships faced by plaintiffs in legal malpractice cases generally. See Note, The Standard of Proof of Causation in Legal Malpractice Cases, 63 Cornell L.Rev. 666, 670 (1978).
[2] This factual analysis does not apply to the City of Philadelphia. There were no facts suggesting that the City had actual or constructive notice of the defect, and therefore it could not have been liable to plaintiff.
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268 F.2d 508
OKLAHOMA NATURAL GAS COMPANY, a corporation, Appellant,v.MID-CONTINENT CASUALTY COMPANY, a corporation (formerlyGeneral Bonding and Insurance Company), Appellee.
No. 6071.
United States Court of Appeals Tenth Circuit.
July 13, 1959.
Clayton B. Pierce, Oklahoma City, Okl. (Melvin F. Pierce, and Pierce, Mock & Duncan, Oklahoma City, Okl., of counsel, on the brief), for appellant.
John B. Dudley, Jr., Oklahoma City, Okl. (Dudley, Dudley & Dudley, Oklahoma City, Okl., of counsel, on the brief), for appellee.
Before MURRAH, PICKETT and BREITENSTEIN, Circuit Judges.
BREITENSTEIN, Circuit Judge.
1
The trial court granted a summary judgment in favor of appellee-plaintiff, a workmen's compensation insurer, and against the appellant-defendant1 whose alleged wrongful acts caused the injuries for which compensation was paid by the insurer. There was no proof of negligence. It was held that liability was fixed by a settlement which the wrongdoer had made with the injured persons.
2
The facts are undisputed. The insurer provided compensation protection for the employer of those injured and pursuant to the Oklahoma law paid the awards to which the injured were entitled. Thereafter the injured sued the appellant, Natural Gas, asserting that the accident resulting in their injuries, was caused by the negligence of Natural Gas. The insurer had knowledge of the pendency of these suits but was not joined as a party and did not intervene. Natural Gas had notice of the compensation payments made by the insurer and of its claim for reimbursement from Natural Gas. The suits were settled and dismissed with prejudice without notice to or consent of the insurer. The amounts paid were substantially in excess of the compensation awards. Each settlement release contained the following provision:
3
'It is not our intention in making this release to release the claim of the insurance company that paid medical expenses and compensation to us; but, it is our intention to settle each and every claim which we have.'
4
After the settlements, the insurer sued Natural Gas asserting two claims: (1) that the payments by Natural Gas to those injured with knowledge of the insurer's rights made Natural Gas liable to it as a matter of law, and (2) that it had suffered a loss, the payment of the compensation awards, because of the negligence of Natural Gas for which it was entitled to recover. The trial court granted summary judgment on the first claim. The position of Natural Gas is that the settlements did not determine its liability as a matter of law and that recovery can only be had under the second claim and on proof of negligence. Natural Gas concedes that the insurer may maintain the second claim.
5
The Oklahoma Workmen's Compensation law provides2 that if a workman entitled to compensation thereunder is injured by the negligence of another not in the same employ, he shall, before any suit or claim, elect whether to take compensation or to pursue his remedy against such other person and 'If he elects to take compensation under this Act, the cause of action against such other shall be assigned to the insurance carrier liable for the payment of such compensation * * *.'
6
The theory of appellant, Natural Gas, is that the injured persons and the insurer each have an independent claim and the settlement of one does not affect the other. The insurer asserts that there is but one claim against the wrongdoer responsible for the injuries and that on the settlement of such claim a trust or lien is impressed on the proceeds of the settlement in favor of the insurer to the amount of its loss with the result that the wrongdoer by ignoring the rights of the insurer became liable as a matter of law to the insurer to the extent of the compensation awards.
7
In Staples v. Central Surety & Ins. Corporation, 10 Cir., 62 F.2d 650, 653, this court upheld the right of a compensation insurer to maintain in its own name a claim against a wrongdoer whose negligence had caused the injuries for which the insurer had paid compensation. The rule so announced was followed by Oklahoma in State Insurance Fund v. Smith, 184 Okl. 552, 88 P.2d 895, 897, and Stinchcomb v. Dodson, 190 Okl. 643, 126 P.2d 257, 259-260. Almost contemporaneously with stinchcomb the Oklahoma Supreme Court decided Parkhill Truck C. v. Wilson, 190 Okl. 473, 125 P.2d 203,3 but neither decision mentioned the other. In Parkhill it was held that the injured workman could maintain a claim against the wrongdoer and the wrongdoer could not be required to pay more than one judgment. At the same time Parkill said that the insurer can require recoupment in the event of recovery from the negligent third party. Subsequent decisions have left the rules announced in Stinchcomb and Parkhill without clarification.4 This court has followed the Staples decision in the Oklahoma case of Baker v. Traders & General Ins. Co., 10 Cir., 199 F.2d 289.
8
The significance of the foregoing decisions relates only to the question of whether there is one cause of action against the wrongdoer or whether the injured person and the insurer each has a separate and independent cause of action. The importance of this difference is nullified by the position of Natural Gas that the insurer may proceed under its second claim. If there is but one cause of action, the rule against splitting of causes of action does not apply because it is for the benefit of the defendant who may waive it.5 Natural Gas in failing to implead the insurer in the workmen's suits, by making a compromise settlement with the workmen after notice of the insurer's claims, and by conceding the right of the insurer to proceed under its second claim, has waived any right to assert as a defense the rule against splitting of causes of action. The situation then is the same whether it be considered that the workmen and the insurer have separate and independent causes of action or whether they have one.
9
It would serve no good purpose to explore the questions relating to the existence of the right of the insurer to recoupment under the common law or under statute and by way of subrogation or indemnity. It is sufficient that the insurer has an assignment by law of so much of the injured persons' claims against the wrongdoer as is required to make the insurer whole for the awards which it has paid. This partial assignment has the sanction of Oklahoma law and is unaffected by the general rule against partial assignment of a tort claim.
10
The injured workmen had the right to sue Natural Gas. They were not required to join the insurer as a party to their suits. Natural Gas ahd the right to settle with the workmen. The law favors settlements. The Oklahoma rule is that compromise settlements are not evidence of substantive facts in negligence cases.6
11
There is nothing in the Oklahoma law which gives an insurer a lien on a recovery of a workman from a wrongdoer responsible for the injury resulting in payment of an award by the insurer to such workman. Also there is nothing which impresses a trust in favor of the insurer against such recovery. We may not rewrite the Oklahoma statutes to provide either for such a lien or such a trust. The heavy reliance of the insurer on Traders & General Ins. Co. v. West Texas Utilities Co., 140 Tex. 57, 165 S.W.2d 713, is misplaced because of the difference between the Texas and Oklahoma statutes.7
12
The mere settlement of a claim for personal injuries does not itself establish liability for the accident out of which the injuries arose. Under the posture of this case the fact of the settlement does not affect the right of the insurer to pursue its remedy. In so doing it must establish the liability of the alleged wrongdoer. Such liability is not established by settlement with the injured workmen.
13
The judgment is reversed and the case is remanded for trial on the second count of the complaint.
1
Hereinafter referred to as Natural Gas
2
85 O.S.A. 44(a)
3
Stinchcomb was decided April 7, 1942, and rehearing denied May 5, 1942. Parkhill was decided April 28, 1942
4
DeShazer v. National Biscuit Co., 196 Okl. 458, 165 P.2d 816; Horwitz Iron & Metal Co. v. Myler, 207 Okl. 691, 252 P.2d 475; L. B. Jackson Drilling Co. v. Prichard, Okl., 308 P.2d 284; Griffin Grocery Co. v. Logan, Okl., 309 P.2d 1074
5
Empire Oil & Refining Co. v. Chapman, 182 Okl. 639, 79 P.2d 608, 610
6
Gibson v. Chickasha Cotton Oil Co., 159 Okl. 291, 15 P.2d 41, 43; Continental Oil Co. v. Tigner, 189 Okl. 619, 118 P.2d 1027, 1028; Skelly Oil Co. v. Johnson, 190 Okl. 45, 120 P.2d 626, 627
7
The Texas statute, R.C.S.1925, Art. 8307, 6a, Vernon's Ann.Civ.St. art. 8307, 6a, provided that an action against a wrongdoer for injuries which were the basis of a compensation award was 'for the joint use and benefit' of the injured employe and the insurer. The court held that a settlement by the employe would unlawfully nullify the subrogation rights of the carrier. Hence, the Texas court concluded that the tort feasor wrongfully paid and the employe wrongfully received with the result that each was liable to the insurer for the amount of its loss
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Filed 5/24/01 by Clerk of Supreme Court
IN THE SUPREME COURT
STATE OF NORTH DAKOTA
2001 ND 103
Mark V. Larson, Plaintiff and Appellee
v.
Norkot Manufacturing, Inc.,
Western Industries, Inc., and
James Page, individually, Defendants, Third-
Party
Plaintiffs and Appellants
v.
McGee, Hankla, Backes & Wheeler,
P.C., Third-Party Defendant
and Appellee
No. 20000321
Appeal from the District Court of Bottineau County, Northeast Judicial District, the Honorable Lester Ketterling, Judge.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
Opinion of the Court by Sandstrom, Justice.
Lyle W. Kirmis, Zuger Kirmis & Smith, P.O. Box 1695, Bismarck, N.D. 58502-1695, for plaintiff and appellee.
James L. Norris, P.C., 12722 Watercress Park, Houston, TX 77041, for defendants, third-party plaintiffs, and appellants.
Steven A. Storslee, Storslee Law Firm, P.C., P.O. Box 4007, Bismarck, N.D. 58502-4007, for third-party defendant and appellee.
Larson v. Norkot
No. 20000321
Sandstrom, Justice.
[¶1] Norkot Manufacturing, Inc., Western Industries, Inc., and James Page (collectively, “Page”) appealed a district court memorandum and order granting the motion of McGee, Hankla, Backes & Wheeler, P.C. (“McGee”), for summary judgment dismissing Page’s third-party complaint against it and granting the motion of Mark V. Larson for summary judgment dismissing Page’s counterclaim against him.
(footnote: 0) We conclude there is a genuine issue of material fact precluding summary judgment. We affirm the stipulated dismissal of Larson’s claim against Page, and reverse the remainder of the judgment, and remand for further proceedings.
I
[¶2] In late 1992 and early 1993, Larson, a member of the McGee law firm, represented Page in negotiating a business asset sale involving grinders and the right to manufacture grinders to Rexworks, Inc. Larson drafted an asset purchase agreement and other agreements, which were signed on February 2, 1993.
[¶3] In a third-party complaint dated January 2, 1996, and filed in a South Dakota circuit court on January 3, 1996, Rexworks named Page as a defendant in a lawsuit involving a grinder manufactured by Page and sold by Rexworks, which caught fire and was destroyed. Page was also joined in a Texas lawsuit in March 1996.
[¶4] Larson sued Page on January 12, 1998, to recover unpaid legal fees. On February 6, 1998, Page answered and counterclaimed for legal malpractice for failing to include in the sale contracts with Rexworks “any provision in the contract to protect Norkot and Page from liability to parties who may be injured, physically or financially, as a consequence of the use of any of the assets transferred from Norkot to Rexworks.” Page filed a third-party complaint against McGee, alleging the same legal malpractice claim.
[¶5] McGee moved for summary judgment dismissing Page’s third-party complaint on the ground that the claim was barred by the statute of limitations. Larson supported McGee’s motion and sought dismissal of Page’s counterclaim on the ground it was barred by the statute of limitations. In a responding affidavit, Page said “Larson never discussed with me that . . . we needed to have an indemnity agreement from Rexworks for the products that Rexworks would manufacture after the sale.” Page further averred:
By not knowing that there needed to be such an indemnity agreement, I was unaware that Larson had committed legal malpractice and I was unaware that Norkot and I had been damaged by Larson’s malpractice. The first time I became aware of Larson’s legal malpractice was when I was served with the third-party petition by Rexworks in the Texas Dirtworks case sometime shortly after April 17, 1996 (see attached Exhibit 75).
In an August 17, 2000, memorandum and order granting the motions for summary judgment, the district court ruled:
The first manifestation of potential claim for negligence occurred when Page was served with the complaint in the South Dakota litigation on January 5, 1996. This would have triggered discussions between Page and his attorneys about the indemnification provisions of the agreements. . . . The written documents and time table objectively show that Page was aware of a potential claim for negligence about indemnification under the 1993 agreements when he was sued for the South Dakota case on January 5, 1996. Since he did not serve his counterclaim until February 6, 1998, the statute of limitations had run and his claim must be barred.
(footnote: 2)
The parties stipulated to dismissal of Larson’s complaint. A judgment was entered dismissing Larson’s complaint, dismissing Page’s counterclaim against Larson, and dismissing Page’s third-party complaint against McGee. Page appealed.
[¶6] The district court had jurisdiction under N.D. Const. art. VI, § 8, and N.D.C.C. § 27-05-06. The appeal was timely under N.D.R.App.P. 4(a). This Court has jurisdiction under N.D. Const. art. VI, §§ 2 and 6, and N.D.C.C. § 28-27-01.
II
[¶7] Under N.D.R.Civ.P. 56, summary judgment shall be rendered if there is no genuine issue as to any material fact and any party is entitled to judgment as a matter of law. Summary judgment may be issued to dispose of a controversy without trial if either party is entitled to judgment as a matter of law, if there is no dispute as to either the material facts or the inferences to be drawn from undisputed facts, or if resolving factual disputes would not alter the result.
Mead v. Farmers Union Mut. Ins. Co.
, 2000 ND 139, ¶ 12, 613 N.W.2d 512.
III
[¶8] Page contends on appeal, among other things:
Norkot and Page’s position on the present appeal is that the earliest the statute of limitations could have started to run was when Page signed the return receipt on April 20, 1996 on the third-party petition involving the Texas Dirt Works case; since April 20, 1996, was the first time that Page was aware of any claim of liability against Norkot and Page by Rexworks for a maxigrinder manufactured by Rexworks. Thus Norkot and Page’s service of the counterclaim on Larson and the third-party complaint on the Firm on February 6, 1998 was clearly within the two year statute of limitations.
Larson and McGee contend the statute of limitations began to run when Page and Norkot were brought into the South Dakota litigation in January 1996, which provided notice of a potential claim for malpractice, and since they did not commence a claim for malpractice until February 1998, the claim was barred by the two-year statute of limitations.
[¶9] The elements of a legal malpractice action for professional negligence are the existence of an attorney-client relationship, a duty by the attorney to the client, a breach of that duty by the attorney, and damages to the client proximately caused by the breach of that duty.
Dan Nelson Constr., Inc. v. Nodland & Dickson
, 2000 ND 61, ¶ 14, 608 N.W.2d 267. The two-year statute of limitations under N.D.C.C. § 28-
01-18(3) applies to malpractice actions against attorneys.
Binstock v. Tschider
, 374 N.W.2d 81, 84 (N.D. 1985). “A cause of action for legal malpractice does not accrue, and the statute of limitations does not commence to run, until the client has incurred some damage.”
Wall v. Lewis
, 366 N.W.2d 471, 473 (N.D. 1985). We have adopted a discovery rule, which tolls the statute of limitations in malpractice actions until the plaintiff knows, or with reasonable diligence should know, of the injury, its cause, and the defendant’s possible negligence.
Jacobsen v. Haugen
, 529 N.W.2d 882, 885 (N.D. 1995).
[¶10] In applying the discovery rule, “the focus is upon whether the plaintiff has been apprised of facts which would place a reasonable person on notice that a potential claim exists. It is not necessary that the plaintiff be subjectively convinced that he has been injured and that the injury was caused by the defendant’s negligence.”
Wall v. Lewis
, 393 N.W.2d 758, 761 (N.D. 1986). To trigger the running of the statute of limitations, a malpractice plaintiff need not fully appreciate the potential liability or even be convinced of an injury; he or she need only know enough to be on notice of a potential claim.
Schanilec v. Grand Forks Clinic, Ltd.
, 1999 ND 165, ¶ 19, 599 N.W.2d 253. “A malpractice plaintiff’s knowledge is ordinarily a question of fact, and summary judgment is rarely appropriate on the issue of when the plaintiff should have discovered there was a potential malpractice claim.”
Duncklee v. Wills
, 542 N.W.2d 739, 742 (N.D. 1996). A malpractice plaintiff’s knowledge becomes an issue of law if the evidence is such that reasonable minds could draw but one conclusion.
Wall
, 393 N.W.2d at 761.
[¶11] The district court rejected the signing of the agreements involved in the sale on February 2, 1993, as the date the statute of limitations began to run. The court found the transaction was complex and there were no facts showing Page “should have been placed on notice of a potential claim by simply reading the agreements.” The district court ruled “[t]he first manifestation of potential claim for negligence occurred when Page was served with the complaint in the South Dakota litigation on January 5, 1996.” The City of Rapid City sued Rexworks in South Dakota, alleging a Norkot Maxigrinder demolition grinder it purchased from Rexworks “malfunctioned, caught on fire and was destroyed.” In a third-party complaint dated January 2, 1996, Rexworks sued Norkot as a third-party defendant, seeking indemnification or contribution for any damages for which Rexworks might be found liable to the City of Rapid City. The Sheriff of Burleigh County, North Dakota, certified that the third-party complaint was served upon Norkot by “delivering to and leaving with
Max Rosenberg, P.C., Registered Agent
, a true and correct copy thereof” on January 8, 1996. On February 21, 1996, Norkot’s attorneys filed an answer, counterclaim, and crossclaim dated February 20, 1996, in South Dakota Circuit Court, seeking indemnity or contribution.
[¶12] We agree with the trial court that service upon Page of the third-party complaint in the South Dakota litigation “would have triggered discussions between Page and his attorneys about the indemnification provisions of the agreements.” Such discussions reasonably should have provided Page with knowledge sufficient to trigger the running of the statute of limitations. Page’s registered agent received the third-party complaint in the South Dakota litigation on January 8, 1996. Page’s attorneys prepared an answer and counterclaim seeking indemnity or contribution, which was dated February 20, 1996. The parties have not drawn our attention to any record evidence showing when Page was actually apprised of the third-party complaint in the South Dakota litigation or when Page discussed that litigation with attorneys in preparing to respond to the third-party complaint, to determine by what date between January 8, 1996, and February 20, 1996, “discussions between Page and his attorneys about the indemnification provisions of the agreements” should reasonably have taken place. Thus, the record is not clear whether the statute of limitations had run by the time Page served his counterclaim.
[¶13] We conclude there is a genuine issue of material fact precluding summary judgment on the question of when Page knew, or with reasonable diligence should have known, of the injury, its cause, and the defendants’ possible negligence.
(footnote: 3) The focus of inquiry is when Page was “apprised of facts which would place a reasonable person on notice that a potential claim exist[ed].”
Wall
, 393 N.W.2d at 761. The ultimate question with regard to triggering the running of the statute of limitations is when did Page “know enough to be on notice of a potential claim” for legal malpractice.
Schanilec
, 1999 ND 165, ¶ 19, 599 N.W.2d 253.
IV
[¶14] The judgment is affirmed to the extent it dismissed Larson’s claim against Page. The remainder of the judgment is reversed, and the matter is remanded for further proceedings.
[¶15] Dale V. Sandstrom
Mary Muehlen Maring
Carol Ronning Kapsner
William F. Hodny, S.J.
Gerald W. VandeWalle, C.J.
[¶16] The Honorable William F. Hodny, S.J., sitting in place of Neumann, J., disqualified.
FOOTNOTES
0:
We treat this as an appeal from the subsequently entered consistent judgment.
Hentz v. Hentz
, 2001 ND 69, ¶ 1 n.1, 624 N.W.2d 694.
2:
January 5, 1996, was not the correct date of service in the South Dakota lawsuit. The registered agent for Norkot Manufacturing Company, Inc., was actually served on January 8, 1996.
3:
We note courts have imputed an attorney’s knowledge to the attorney’s client in determining statute of limitations issues.
See
,
e.g.
,
Preblich v. Zorea
, 996 P.2d 730, 736 (Alaska 2000) (client charged with constructive discovery when the client’s new attorney should have discovered the client’s cause of action against the client’s previous attorney);
Vermont Agency of Natural Res. v. Towns
, 724 A.2d 1022, 1025 (Vt. 1998) (“notice to an attorney sufficient to trigger the statute of limitations is imputed to the client, and will bar a claim, regardless of whether that information was actually communicated to the client”).
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388 So.2d 981 (1980)
Edward Charles FERGUSON, M. D.
v.
Leon C. HAMRICK, M. D., Chairman of the State of Alabama Board of Medical Examiners.
79-160.
Supreme Court of Alabama.
October 3, 1980.
*982 J. Mark White of Smith, White & Hynds, Birmingham, for appellant.
Charles A. Graddick, Atty. Gen., and Elizabeth N. Petree, Asst. Atty. Gen., for appellee.
TORBERT, Chief Justice.
This appeal is from an order of the Alabama State Board of Medical Examiners revoking Edward Charles Ferguson's license to practice medicine.
Dr. Ferguson was charged with practicing medicine in such a manner as to unwarrantedly endanger the health and safety of his patients with regard to: (1) the quantity of controlled substances prescribed, (2) the frequency of such prescriptions, and (3) the medical judgment exercised in prescribing controlled substances.
The only witness who testified in support of the Board of Medical Examiners' complaint was Mr. Vick McClellan, an employee of the Alabama Department of Public Safety, Bureau of Investigation of Narcotics, who testified that he collected from pharmacists prescriptions which Dr. Ferguson had written between August 1978 and February 1979. Certain prescriptions for large quantities of controlled substances were admitted into evidence. Dr. Ferguson also testified, and various members of the Board of Medical Examiners questioned him regarding specific patients, specific habits, his personal life, and specific prescribing practices and procedures. At the conclusion he was advised that the Board would look into the situation and notify him of its decision. Subsequently, the Board entered the following order revoking Dr. Ferguson's certificate to practice medicine:
The Alabama State Board of Medical Examiners met on October 17, 1979, with Edward Charles Ferguson, M.D., and heard extensive testimony concerning the prescribing of controlled substances by Dr. Ferguson for several of his patients. The Board heard testimony relating to the amount and frequency of controlled substances prescribed by Dr. Ferguson for a number of specific patients and questioned Dr. Ferguson concerning his exercise of medical judgment in deciding to issue the various prescriptions. It was the unanimous opinion of the Board that Dr. Ferguson improperly and excessively prescribed controlled substances to patients; that Dr. Ferguson prescribed Percodan for patients complaining of headaches without properly evaluating the patients; that Dr. Ferguson improperly treated dysuria with Dyazide; that Dr. Ferguson improperly administered intravenous Lanoxin to a patient with tachycardia without ascertaining the amount of Digitalis that the patient had been taking; and that Dr. Ferguson treated patients with excessive doses of thyroid medication without first utilizing adequate screening and diagnostic procedures. It was further the unanimous opinion of the Board that Dr. Ferguson does not possess sufficient medical knowledge to practice medicine without endangering *983 the health and safety of his patients.
The aforesaid considered, it is ORDERED, ADJUDGED, AND DECREED that the certificate of qualification to practice medicine in the State of Alabama previously issued to Edward Charles Ferguson, M.D., be and the same is hereby revoked.
Dr. Ferguson contends that the Board's order should be reversed because (1) it was not supported by a preponderance of the evidence and is procedurally and legally insufficient, since there was no expert testimony produced at the hearing as to the propriety or impropriety of Dr. Ferguson's prescribing practices and (2) the hearing did not comport with the requirements of procedural due process.
Section 34-24-90 of the Alabama Code provides that before a physician's certificate to practice medicine is revoked, he shall have been found guilty of an offense specified therein by a preponderance of the evidence propounded before the board. Section 34-24-105 provides that on appeal of such cases to this court, the decision of the Board revoking a certificate shall not be reversed if it is "supported by the transcript of testimony." Thus, on appeal, an order of the Board revoking a certificate is reviewed to determine if it is supported by a preponderance of the evidence, and if so, it must be affirmed.
There is no requirement that expert testimony be produced at a hearing before the Board of Medical Examiners. The Legislature, in creating the Board of Medical Examiners has vested the authority to judge the professional conduct of physicians in a body wholly composed of medical experts-the body best qualified by training and experience to exercise this authority. Accordingly, there is no prohibition against the members of the Board relying upon their own expertise in reaching a conclusion. Jaffe v. State Department of Mental Health, 135 Conn. 339, 64 A.2d 330 (1949). The existence or non-existence of expert testimony only goes to the evidentiary question of whether the Board's order is supported by a preponderance of the evidence.
The evidence unquestionably establishes that Dr. Ferguson frequently prescribed high quantities of Class II controlled substances. It is common knowledge that many of these drugs lead to addiction or dependency or are otherwise harmful to one's health. Prescriptions for Class II controlled substances were introduced for some forty-five patients of Dr. Ferguson. Many patients were prescribed Class II drugs on a regular basis and in combination with other drugs, including other Class II drugs, and in very large quantities. For instance, one patient was prescribed 620 tablets of Valium, 245 of quaalude, 70 of norgesic forte, 1 ounce tincture of opium as well as other Class II drugs during the eight-month period from August 1978 to April 1979. Another patient was prescribed 665 quaalude and Valium tablets over a forty-one day period. Three other patients were each prescribed an average of 147 percodan tablets a month for six months. One patient was prescribed, over a six and a half month period, 2 ounces tincture of opium, 30 tablets of valium, 195 of quaalude, 240 of percodan, and 216 of mephergan forte.
Of course, it may be necessary to prescribe high quantities of controlled substances despite the risks in some cases, such as terminal cases where the pain is intense; however, the record is silent as to any such situation in this case. Moreover, Dr. Ferguson himself admitted, "I recognize that I overprescribed for certain people," although he did state that he has since corrected such prescribing practices.
We agree with Dr. Ferguson that the preponderance of the evidence does not support the Board's specific findings that he improperly treated dysuria with Dyazide and, in fact, contradicts the finding that he administered Lanoxin without ascertaining the amount of digitalis taken by the patient. Furthermore, we do not find sufficient evidence to affirm the extraneous finding that Dr. Ferguson does not possess sufficient medical knowledge to practice medicine.
*984 Nonetheless, these particular erroneous findings do not warrant reversal. The doctrine that error, in order to furnish a ground for reversal, must be prejudicial is generally applied to review of a decision by an administrative board. 2 Am.Jur.2d Administrative Law § 758 (1962). Moreover, by statute, the harmless error rule is made applicable to the review of a decision of the Board of Medical Examiners. See Code 1975, § 34-24-104; ARAP 45. We find that the erroneous findings are non-prejudicial since the Board's finding that Dr. Ferguson endangered the health and safety of patients by improperly and excessively prescribing controlled substances is supported by a preponderance of the evidence, and serves without more, as a valid ground of revocation of Dr. Ferguson's medical certificate.
Dr. Ferguson also argues that the hearing was conducted in a fashion which denied him due process of law: that it was conducted in "a fashion that was disorderly, unfair, and without any similarity of established rule or order." It is true that members of the Board repeatedly interrupted the direct examination of Dr. Ferguson to ask questions. However, "[a]n appellate court should view with less strictness the procedural aspects of proceedings before an administrative body than when dealing with procedural aspects occurring in a lower court." State v. Alabama Public Service Commission, 293 Ala. 553, 562-63, 307 So.2d 521, 528-29 (1975).
Dr. Ferguson was confronted with the charges against him and was afforded a hearing with representation by counsel. He was allowed to cross-examine the witness against him and to present his own evidence as well as to make closing statements. Furthermore, Dr. Ferguson was supplied with the written findings of the Board based on the evidence. We find from a review of the record that Dr. Ferguson was given notice and the opportunity to be heard, in compliance with the standards announced in Katz v. Alabama State Board of Medical Examiners, 351 So.2d 890 (Ala.1977). Thus, the hearing was not conducted in such a manner as to amount to a denial of due process.
Accordingly, the order of the Board of Medical Examiners revoking Dr. Ferguson's certificate to practice medicine in Alabama must be affirmed.
AFFIRMED.
MADDOX, ALMON, SHORES and BEATTY, JJ., concur.
EMBRY, J., with whom FAULKNER and JONES, JJ., concur, dissents.
EMBRY, Justice (dissenting):
As I see it, at issue in this appeal is not only whether the State Board of Medical Examiners' revocation of Dr. Ferguson's license to practice medicine was supported by a preponderance of the evidence but also whether the hearings before that Board were conducted so as to comport with the requirements of procedural due process of law. I find no suggestion in the record that any promulgated rules or regulations governing procedures similar to those conducted in this case exist or are in effect. Apparently, each hearing of this nature is conducted on an ad hoc basis and not in accord with established precedent to which reference may be made by one charged, or his or her counsel. As the record shows in this case, without established, orderly, and clear guidelines comporting with known precepts of trial procedures, chaos prevails, as it did in these proceedings.
No expert testimony was introduced which in any way reflected on the propriety or impropriety of Dr. Ferguson's prescribing practices in general or with regard to any particular patient. The record is also devoid of expert testimony showing an unwarranted endangerment of the health and safety of any of his patients.
Before revoking any certificate of qualification to practice medicine the Board of Medical Examiners is required to find a person guilty by a preponderance of the evidence propounded before the Board of any of the acts, offenses, or conditions which § 34-24-90, Code 1975, lists as grounds for such revocation.
*985 The evidence before the Board related only to the amount and frequency of controlled substances prescribed for certain patients and Dr. Ferguson's testimony as to the basis of his decision to write certain prescriptions. From this evidence the Board concluded: (1) That Dr. Ferguson improperly and excessively prescribed controlled substances to patients; (2) That he used improper evaluation and diagnostic procedures; and (3) That he lacked sufficient medical knowledge to practice medicine. Clearly, the evidence before the Board affords no basis for finding Dr. Ferguson's practices were improper or that his medical knowledge was insufficient relative to proper medical practices or the requisite knowledge of medicine. Therefore, the record does not contain sufficient evidence to support the Board's order. The right to engage in the practice of medicine is a property right which may be denied by the State only if the requirements of due process are complied with. Greenfield v. Hamrick, 341 So.2d 136 (Ala.1976); Barnes v. State ex rel. Ferguson, 274 Ala. 705, 151 So.2d 619 (1963).
In Katz v. Alabama State Board of Medical Examiners, 351 So.2d 890 (Ala.1977), the requirements of procedural due process in cases such as this one were stated:
"`* * * an orderly proceeding appropriate to the case or adapted to its nature, just to the parties affected, and adapted to the ends to be attained; one in which a person has an opportunity to be heard, and to defend, enforce, and protect his rights before a competent and impartial tribunal legally constituted to determine the right involved; representation by counsel; procedure at the hearing consistent with the essentials of a fair trial according to established rules which do not violate fundamental rights, and in conformity to statutes and rules, conducted in such a way that there will be opportunity for a court to determine whether the applicable rules of law and procedure were observed; revelation of the evidence on which a disputed order is based and opportunity to explore that evidence, and a conclusion based on the evidence and reason. * * *"'
I would hold that these are minimum requirements of procedural due process which were not met in this case and which should be adhered to in every case. Absent an Administrative Procedures Act, I would have this court set the rules by which the Board would conduct proceedings of this nature.
That nature of due process is not afforded where the Board relies on its own expertise rather than presenting expert testimony by witnesses subject to cross-examination. See Garney v. Anderson, 56 Ill.App.3d 677, 372 N.E.2d 151 (1978); Cleary, McCormick's Handbook of the Law of Evidence, § 353 (2d Ed. 1972).
In this case, because no expert evidence was introduced, not only was Dr. Ferguson deprived of an opportunity to cross-examine, explore, or refute such evidence, but the record furnishes no factual standard for the Board's conclusions and therefore no standard by which this court may determine whether his activities unwarrantedly endangered the health and safety of his patients. McKay v. State Board of Medical Examiners, 103 Colo. 305, 86 P.2d 232 (1938).
I would reverse the order of the Alabama State Board of Medical Examiners revoking Dr. Ferguson's license and remand this matter to that Board for proceedings to accord with my expressed views.
FAULKNER and JONES, JJ., concur.
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This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2014).
STATE OF MINNESOTA
IN COURT OF APPEALS
A16-0374
State of Minnesota,
Respondent,
vs.
Rhiannon Marie Zych,
Appellant.
Filed September 19, 2016
Affirmed
Ross, Judge
Wabasha County District Court
File No. 79-CR-15-495
Lori Swanson, Attorney General, St. Paul, Minnesota; and
Karen S. Kelly, Wabasha County Attorney, Wabasha, Minnesota (for respondent)
Dominique J. Navarro, Restovich Braun & Associates, Rochester, Minnesota (for
appellant)
Considered and decided by Ross, Presiding Judge; Connolly, Judge; and Toussaint,
Judge.
Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to
Minn. Const. art. VI, § 10.
UNPUBLISHED OPINION
ROSS, Judge
Rhiannon Zych was high on drugs at 2:00 in the morning when she and her
companion pulled over to ask deputies for directions. The state charged Zych with fifth-
degree possession of a controlled substance and petty-misdemeanor possession of drug
paraphernalia after deputies found methamphetamine and related material in the glove
compartment of the car in which she was the only passenger. The case proceeded to trial
on stipulated facts under Minnesota Rule of Criminal Procedure 26.01, subdivision 3. The
district court convicted her of both charges. Zych appeals, arguing that the stipulated
evidence was insufficient to prove her possession. Because the circumstantial evidence
allows for no reasonable hypothesis other than that Zych possessed the methamphetamine
and paraphernalia, we affirm.
FACTS
Three deputies were standing and chatting in the lot of the carwash on Maple Street
in Mazeppa at about 2:00 one morning in June 2015 when a car pulled up. Evan Prendez
was driving and Rhiannon Zych was in the passenger seat. Prendez leaned over toward
Zych’s open window and asked the deputies for directions.
Deputy Keith Fratzke shined his light inside the car and recognized marijuana
particles on the front and rear floor. He asked about the marijuana. Prendez said he used to
smoke the drug but no longer does, and he suggested that a friend of his might have dropped
a baggie or a pipe in the car. Deputy Fratzke asked if there were drugs or a pipe in the car,
and Prendez became evasive. The deputy asked for identification from both occupants and
2
insurance papers. Both told the deputy that they had electronic proof of insurance, but they
could not access the internet on their phones.
Deputy Fratzke searched the car. When he opened the glove compartment he found
small boxes containing straws, Q-tips, a razor blade, and two small baggies with a white
crystalline substance that tested positive as methamphetamine. The deputies also found a
meth pipe under the driver’s seat. Prendez said the methamphetamine was his.
Deputy Fratzke spoke with Zych. She appeared to him to be under the influence of
drugs. Zych said that she smoked three “bumps” with Prendez.
The deputies arrested Prendez and took him to jail. There he confessed that he and
Zych had used methamphetamine in Red Wing about three hours earlier and were returning
to Rochester when they stopped to talk to the deputies. Prendez acknowledged that Zych
was his girlfriend or fiancée. He said that the car’s insurance policy was being changed so
that Zych’s former husband would no longer be the named insured.
The state charged Zych with fifth-degree controlled substance crime and petty-
misdemeanor possession of drug paraphernalia. Zych requested a stipulated-facts trial
under Minnesota Rule of Criminal Procedure 26.01, subdivision 3. The parties stipulated
that the district court could receive as evidence the police reports and the recording of
Prendez’s jailhouse discussion with the deputy.
The district court made fact-findings based on the stipulated evidence. It found that
the methamphetamine and incidental materials were discovered in the vehicle where Zych
was a passenger, that Zych used methamphetamine with Prendez hours before they
encountered the deputies, and that Zych was under the influence of methamphetamine. The
3
court found also that Zych and Prendez jointly possessed the methamphetamine that the
deputy found in the glove compartment. It found Zych guilty of both charges. The district
court stayed adjudication of Zych’s conviction and placed her on probation for five years.
Zych appeals.
DECISION
Zych argues on appeal that the stipulated evidence does not support the guilty
verdict. By proceeding on stipulated facts under rule 26.01, subdivision 3, as opposed to
subdivision 4, Zych retained her ability to challenge the sufficiency of the evidence on
appeal. See State v. Eller, 780 N.W.2d 375, 379 (Minn. App. 2010). When reviewing a rule
26.01, subdivision 3 conviction, we examine the entire record to determine whether
sufficient evidence supports the verdict. State v. Dominguez, 663 N.W.2d 563, 566 (Minn.
App. 2003). We hold that it does.
Possession of a controlled substance can be proved by actual or constructive
possession. State v. Florine, 303 Minn. 103, 104, 226 N.W.2d 609, 610 (1975). When the
controlled substance is not found on the defendant’s person, the state can prove her guilt
by establishing that she constructively possessed the drugs. Id. Here, neither the drugs nor
the paraphernalia were found on Zych’s person, and so the state could prove constructive
possession by showing either that the deputy found the drugs and paraphernalia in a place
under Zych’s exclusive control or that there was a strong possibility, inferred from other
evidence, that Zych consciously exercised dominion and control over them. See id. at 105,
226 N.W.2d at 611. Because the methamphetamine was found in the glove compartment
while Prendez was driving and the record indicates that multiple people used the car, the
4
car and glove compartment were not necessarily within Zych’s exclusive control. See id.
(“Because defendant did not have exclusive possession of the automobile, one could not
automatically infer from the mere fact that cocaine was found in the automobile that the
cocaine belonged to defendant.”). Without addressing whether the state could establish
Zych’s guilt for joint possession by proving that Zych and Prendez together possessed the
car to the exclusion of all others, we turn to consider whether the conviction can rest on the
second method of constructive possession (that there was a strong possibility, inferred from
other evidence, that Zych consciously exercised dominion and control over the drugs and
paraphernalia).
Because the stipulated facts provide only circumstantial evidence of Zych’s
possession, we review under a two-step circumstantial-evidence analysis. State v.
Silvernail, 831 N.W.2d 594, 598 (Minn. 2013). We first identify the circumstances proved,
assuming that the fact-finder resolved any contradictions consistent with the verdict. Id. at
598–99. We then independently examine the reasonableness of all inferences that could be
drawn from those circumstances. Id. at 599. To affirm, we must conclude that all
circumstances proved are consistent with guilt and inconsistent with any reasonable,
innocent hypothesis, not deferring to the fact-finder’s choice between the reasonable
alternatives. State v. Andersen, 784 N.W.2d 320, 329–30 (Minn. 2010).
The circumstances proved and those necessarily inferred from the stipulated
exhibits are these: the glove compartment immediately in front of Zych contained
methamphetamine, straws, Q-tips, and a razor blade; Zych was the only passenger in the
car and was seated closest to the glove compartment; Zych was under the influence of drugs
5
and admitted to smoking drugs within hours before the encounter with deputies; Prendez
told the deputy that he and Zych used methamphetamine before they encountered the
deputies; Zych and Prendez had a close relationship; until recently, the car’s insurance
policy named Zych’s former husband as an insured. These facts reasonably indicate that
Zych possessed the glove-compartment contents at least jointly with Prendez.
Zych does not clearly articulate any alternative rational hypothesis. She instead
suggests that the evidence is insufficient because, although she used drugs that night, she
did not knowingly possess these specific drugs. She argues that the district court clearly
erred by finding that she smoked methamphetamine, rather than something else, earlier that
night because the parties did not stipulate to this fact. But the parties stipulated that the
district court could consider the police reports and Prendez’s recorded statement. And
Prendez stated specifically that he and Zych used methamphetamine, not merely that they
had used drugs generally. The challenged finding is supported by the evidence.
Zych likens this case to State v. Sam and argues that she should similarly prevail on
her sufficiency-of-the-evidence claim. 859 N.W.2d 825 (Minn. App. 2015). But Sam does
not resemble this case. In Sam, we reversed a driver’s drug-possession conviction after
methamphetamine was found in the glove compartment of a car he had borrowed and in
the front-seat passenger’s wallet. Id. at 828–29. We saw two alternative hypotheses based
on the evidence: the drugs were already in the car when the defendant borrowed it or the
passenger put the methamphetamine in the glove compartment. Id. at 835. No evidence in
the record showed the defendant even knew about the drugs. Id.
6
Unlike the defendant in Sam, Zych was the closest person to the drugs, Zych had
used methamphetamine before the arrest, Zych had traveled in the car with Prendez from
where they had used methamphetamine to where they encountered deputies, Zych was still
under the influence of drugs at the time of the arrest, and the ownership interest in the car
can implicitly be traced to Zych by way of her former marriage.
Zych offers no reasonable hypothesis other than guilt. The record supports the
district court’s conclusion that Zych at least jointly possessed the methamphetamine and
paraphernalia.
Affirmed.
7
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41 F.3d 1508
NOTICE: Sixth Circuit Rule 24(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Sixth Circuit.UNITED STATES of America, Plaintiff-Appellee,v.Wilbert Leon SMITH, Defendant-Appellant.
No. 94-1387.
United States Court of Appeals, Sixth Circuit.
Nov. 22, 1994.
Before: KENNEDY, CONTIE and SUHRHEINRICH, Circuit Judges.
ORDER
1
Wilbert Leon Smith, Jr., a pro se federal prisoner, appeals a district court judgment denying his motion to correct his illegal sentence filed pursuant to Fed.R.Crim.P. 35(a). The case has been referred to a panel of the court pursuant to Rule 9(a), Rules of the Sixth Circuit. Upon examination, this panel unanimously agrees that oral argument is not needed. Fed.R.App.P. 34(a).
2
In September 1984, Smith was indicted by a federal grand jury in a fourteen count indictment. Smith was charged with: conspiracy to import heroin and conspiracy to possess with intent to distribute heroin in counts one and two, in violation of 21 U.S.C. Secs. 960, 963, 841(a)(1) and 846; possession with intent to distribute heroin and aiding and abetting in counts three and four, in violation of 21 U.S.C. Sec. 841(a)(1) and 18 U.S.C. Sec. 2(a); unlawfully utilizing a communication facility in counts five through thirteen, in violation of 21 U.S.C. Sec. 843(b); and engaging in a continuing criminal enterprise in count fourteen, in violation of 21 U.S.C. Sec. 848. The jury found Smith guilty of counts one through three and eight through fourteen, and the court sentenced him to fifteen years of imprisonment on each of counts one, two and three, to be served concurrently with each other, and a special parole term of six years on count three, and four years of imprisonment on counts eight through thirteen, each sentence to be served concurrently with counts one through three. On count fourteen, the court sentenced Smith to fifteen years of imprisonment, to be served consecutive to counts one through three. Additionally, the court order Smith to pay a $75,000 committed fine.
3
On appeal, this court vacated Smith's convictions on the two conspiracy charges as lesser included offenses of the continuing criminal enterprise charge, and affirmed Smith's remaining convictions. United States v. Adams, et al., Case Nos. 85-1330 and 85-1338 (6th Cir. Sept. 24, 1986). However, this court indicated that Smith need not be resentenced because the sentences for the conspiracy charges were concurrent with his other sentences. Thereafter, Smith filed several unsuccessful Rule 35 motions seeking to correct his sentences. In his current, and fourth Rule 35 motion, Smith argues that: 1) his sentence is in violation of the prohibition against ex post facto laws; 2) he should be resentenced on count three because it is unclear whether this sentence was influenced by his (vacated) convictions for counts one and two; 3) his sentence for count three is improper because it includes a six year special parole term; and 4) the court improperly imposed a $75,000 fine given Smith's indigency. The district court denied Smith's motion without requiring a response from the government. Smith has filed a timely appeal, as well as a motion for the appointment of counsel.
4
Upon review, we note that Smith committed the within criminal acts prior to November 1, 1987. Thus, Smith is not prohibited from filing a Fed.R.Crim.P. 35 motion to correct his sentence by amended Fed.R.Crim.P. 35. Nonetheless, we conclude that the district court did not abuse its discretion when it dismissed Smith's motion. See United States v. Brummett, 786 F.2d 720, 722-23 (6th Cir.1986).
5
Smith's sentence is not in violation of the prohibition against ex post facto laws as he was sentenced pursuant to a statute in effect at the time of his offense. See Caldwell v. Heckler, 819 F.2d 133, 134 (6th Cir.1987) (per curiam); Peeler v. Heckler, 781 F.2d 649, 651 (8th Cir.1986). Smith's six year special parole term was also legal. See 21 U.S.C. Sec. 841(a)(1). Finally, Smith's $75,000 committed fine is proper as a defendant's alleged indigency does not render a legally imposed sentence improper. See United States v. Blanton, 739 F.2d 209, 211-12 (6th Cir.1984).
6
Accordingly, we hereby deny the appointment of counsel and affirm the district court's judgment pursuant to Rule 9(b)(3), Rules of the Sixth Circuit.
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736 N.E.2d 304 (2000)
Thomas BURKETT, Appellant-Defendant,
v.
STATE of Indiana, Appellee-Plaintiff.
No. 49A02-0004-CR-239.
Court of Appeals of Indiana.
October 10, 2000.
*305 Joseph F. Thoms, Indianapolis, Indiana, Attorney for Appellant.
Karen M. Freeman-Wilson, Attorney General of Indiana, Adam M. Dulik, Deputy Attorney General, Indianapolis, Indiana, Attorneys for Appellee.
OPINION
BROOK, Judge
Case Summary
Appellant-defendant Thomas Burkett ("Burkett") appeals his conviction for possession of marijuana, a Class A misdemeanor.[1] We reverse.
Issue
Burkett raises one issue for review: whether the trial court should have found that the investigative stop of Burkett was unconstitutional and thus should have granted his motion to suppress evidence.
Facts and Procedural History
The facts most favorable to the judgment show that on June 5, 1999, Indianapolis Police Department Officer Clifton Jones ("Jones") received a radio report of possible narcotics dealing by three or four African-American men around the 4400 block of East 30th Street. From previous arrests he had made in that area, Jones knew the neighborhood to have a high incidence of drug trafficking. When Jones approached the location at 11:52 p.m., he found a single African-American male, Burkett, standing on a street corner and wearing a hooded sweatshirt with the hood up in seventy-six-degree weather. As Jones pulled up to the curb, Burkett turned and walked away. Jones then exited his police car, ordered Burkett to stop, and proceeded to conduct a pat-down search of Burkett. While Jones was conducting the search, he asked Burkett whether he was carrying any weapons, and Burkett responded that he had a knife in his pocket. After finding and removing the knife, Jones asked him if he had any more weapons. Burkett then confessed that he had "some weed" in his pocket. Once Jones had confiscated a plastic bag with marijuana from Burkett's pocket, he arrested him.
At trial, Jones was the sole witness for the State; he testified that he stopped Burkett because "he was in the area" and "fitted [sic] the description of a black male," (R. at 24), and that he patted him down for safety reasons. At trial, Burkett's attorney moved to suppress all evidence obtained after the investigative stop as the fruit of an unconstitutional search and seizure, but the court overruled the motion. Burkett was convicted of possession of marijuana as a Class A misdemeanor in a bench trial on August 20, 1999.
Discussion and Decision
Burkett's illegal search and seizure claim arises under the Fourth Amendment to the United States Constitution, which imposes a standard of reasonableness upon the discretion of law enforcement agents in order to protect individual privacy from arbitrary invasions. *306 See Delaware v. Prouse, 440 U.S. 648, 653-54, 99 S.Ct. 1391, 59 L.Ed.2d 660 (1979). Searches conducted without a warrant from a judge or magistrate are per se unreasonable under the Fourth and Fourteenth Amendments unless they fall into a few exceptional categories. See L.A.F. v. State, 698 N.E.2d 355, 355 (Ind.Ct.App.1998). We strictly construe exceptions to the warrant requirement. See Ceroni v. State, 559 N.E.2d 372, 374 (Ind.Ct.App.1990). The State has the burden of proving that a presumptively illegal search falls within one of the well delineated exceptions. See Hanna v. State, 726 N.E.2d 384, 388 (Ind.Ct.App. 2000).
The exception at issue here[2] is the investigative stop exception, "whereby a police officer can stop and briefly detain a person for investigative purposes if the officer has a reasonable suspicion, supported by articulable facts, that criminal activity may be afoot, even if the officer lacks probable cause." Santana v. State, 679 N.E.2d 1355, 1359 (Ind.Ct.App.1997). Even Jones' brief detention of Burkett for questioningshort of a traditional arrestis a seizure of his person implicating his Fourth Amendment rights. See Brown v. Texas, 443 U.S. 47, 50, 99 S.Ct. 2637, 61 L.Ed.2d 357 (1979); Green v. State, 719 N.E.2d 426, 429 (Ind.Ct.App.1999). The facts supporting a reasonable suspicion that criminal activity is afoot must rise to "some minimum level of objective justification" for the temporary detention of a person to be valid. Reeves v. State, 666 N.E.2d 933, 936 (Ind.Ct.App.1996). Even if justified, a reasonable suspicion only permits the officer to temporarily freeze the situation for inquiry and does not give him all the rights attendant to an arrest. See State v. Smith, 638 N.E.2d 1353, 1355 (Ind.Ct.App.1994). The totality of the circumstances are to be considered in evaluating whether an officer had a reasonable suspicion in a particular case. See Wilson v. State, 670 N.E.2d 27, 31 (Ind.Ct.App. 1996). Although we generally review a trial court's decision to admit evidence despite a motion to suppress under an abuse-of-discretion standard, see C.D.T. v. State, 653 N.E.2d 1041, 1044 (Ind.Ct.App.1995), "the ultimate determination of reasonable suspicion is reviewed de novo." Green, 719 N.E.2d at 429.
The State points to four facts which, it claims, create a totality of circumstances giving rise to a reasonable suspicion of criminal activity. Burkett was in a neighborhood known for drug trafficking at a late hour. He was wearing a hooded sweatshirt in seventy-six-degree weather. He turned and walked away when Jones pulled his patrol car up to the corner on which Burkett was standing. His racial identity was the same as that of the group of men who someone complained were dealing in narcotics in the area where Burkett was located.
At the outset, we note that neither presence in a high-crime neighborhood *307 alone, see Brown, 443 U.S. at 52, 99 S.Ct. 2637; Green, 719 N.E.2d at 429, nor an anonymous tip alone that is not confirmed in significant aspects, see Lampkins v. State, 682 N.E.2d 1268, 1271 (Ind.1997), may constitute a reasonable suspicion. Also, we have differentiated between situations in which some person makes an abrupt, hasty attempt to avoid contact with law enforcement and ones in which the alleged flight consists of nothing more than turning and walking in another direction. See Tumblin v. State, 664 N.E.2d 783, 785 (Ind.Ct.App.1996). Furthermore, Indiana cases in which rapid flight supported a finding of reasonable suspicion are distinguishable on that basis. See Wilson, 670 N.E.2d at 28-29 (after hiding between two houses, the defendant ran from the police and hid a balled-up piece of paper in his mouth); Platt v. State, 589 N.E.2d 222, 225 (Ind.1992) (defendant fled in car with great haste when a deputy pulled up behind the car sitting on the side of a country road at 3:00 a.m.); Hailey v. State, 521 N.E.2d 1318, 1319 (Ind.1988) (when defendant walking down street at 1:30 a.m. noticed an officer was watching him, he changed the direction in which he was walking and accelerated his pace).
Still, the State contends that the totality of the circumstances justifies a reasonable suspicion by Jones. However, we find that the totality of the circumstances falls strikingly close to that in Tumblin, 664 N.E.2d 783, where we determined that an officer did not have a reasonable suspicion to stop two black males who were walking in a high-crime area and turned to walk in the opposite direction when they came upon an approaching squad car. In arriving at our decision in Tumblin, we stated that "[t]he color of one's skin, the neighborhood one happens to be in, and the fact that one turns away from the police are not sufficient, individually or collectively, to establish a reasonable suspicion of criminal activity." Id. at 785 (emphasis added). Cf. Williams v. State, 477 N.E.2d 96, 98 (Ind.1985) (defendant walking on a sidewalk in a high-crime district at 1:30 a.m., carrying an unidentifiable object which turned out to be a coat was detained unconstitutionally)[3]and Reeves v. State, 666 N.E.2d 933, 934 (Ind. Ct.App.1996) (at 3:00 p.m. in a neighborhood known for drug trafficking and shooting, officer illegally detained defendant whoas the officer drove by began to walk with another black male juvenile who avoided eye contact with and took quick, furtive peeks at the officer).
Although the facts in this case go incrementally beyond those in Tumblin in a couple of respects, we find that they do not go far enough beyond Tumblin to establish a reasonable suspicion.[4] First, in regard to the complaint that Jones received about three or four African-American males dealing in narcotics, we note that the description of the people involved was neither very specific nor matched Burkett precisely, since he was present at the corner alone. This is important because our supreme court has said that "[w]hen significant aspects of [a] caller's predictions are verified, there [is] reason to believe not only that the caller was honest but also that he was well informed, at least well enough to justify the stop." Lampkins, 682 N.E.2d at 1271 (emphasis added). Here, Jones testified that he stopped Burkett for investigation because Burkett "was in the area" and "fitted [sic] the description of a black male." (R. at 24.) The specificity level of the tip relied upon by Jones distinguishes this case from others *308 in which a person's similarity to a description of some suspect gave rise to a valid, legal investigative stop that eventually led to the discovery of incriminating evidence. See Lampkins, 682 N.E.2d at 1271 (anonymous tipster described a brown Impala with a specific license plate number); Owens v. State, 497 N.E.2d 230, 232 (Ind.1986) (robbed pharmacist described thirty-five-year-old, 5"7' black male wearing a green shirt and brown hat and carrying a green bag, and police came upon a black male in his thirties wearing a green shirt and tan hat and carrying a burgundy bag); Johnson v. State, 710 N.E.2d 925, 927 (Ind.Ct.App.1999) (officer who witnessed random shooting described the fleeing suspect as a 5"10'6"0' black male in his late teens or early twenties wearing dark clothing); Smith, 638 N.E.2d at 1354 (truck driver reported gray Dodge Dakota pickup with specific license plate number weaving on interstate highway).
Second, in regard to Burkett's attire, we find that it adds little to the totality of the circumstances. While Jones mentioned his attire during the State's case in chief, the State did not meet its burden of specifically linking it to potential criminal activity calling for investigation, and of course, the State has the burden of showing how facts justify one of the strictly construed exceptions to the warrant requirement. See Hanna v. State, 726 N.E.2d 384, 388 (Ind.Ct.App.2000). Though the sweatshirt may seem odd in light of the temperature, we decline to hold that people compromise their Fourth Amendment rights simply by wearing clothing that is baggy or that is somewhat warmer than would appear to be in season, especially not when the article of clothing is as mundane as a sweatshirt.[5]
Pursuant to the exclusionary rule from Mapp v. Ohio, 367 U.S. 643, 81 S.Ct. 1684, 6 L.Ed.2d 1081 (1961), all the fruits of Burkett's detainment should have been suppressed. The erroneous admission of evidence was a reversible error since Burkett's substantial rights were clearly prejudiced. See Martin v. State, 622 N.E.2d 185, 188 (Ind.1993). Retrial is not barred by the erroneous admission of evidence unless additional properly admitted evidence is legally insufficient to support the conviction; in the latter situation, double jeopardy forbids a retrial. See Ground v. State, 702 N.E.2d 728, 732 (Ind.Ct.App. 1998). Because the State has no evidence that Burkett committed the crime of possession of marijuana other than the evidence resulting from the unconstitutional Terry stop, we will not remand this case for a new trial.
Reversed.
SULLIVAN, J., and NAJAM, J. concur.
NOTES
[1] See IND.CODE § 35-48-4-11.
[2] Burkett does not challenge the warrantless pat-down search of his body, allegedly performed by Jones for officer safety; he only challenges the fact that he was stopped for investigation and questioning. We note that a careful reading of Terry v. Ohio, 392 U.S. 1, 88 S.Ct. 1868, 20 L.Ed.2d 889 (1968), as well as other case law interpreting it, see, e.g., Minnesota v. Dickerson, 508 U.S. 366, 373, 113 S.Ct. 2130, 124 L.Ed.2d 334 (1993); Johnson v. State, 710 N.E.2d 925, 928 (Ind.Ct. App.1999); Wilson v. State, 670 N.E.2d 27, 29 (Ind.Ct.App.1996), reveals a fine distinction between (1) facts supporting a brief investigative detention (reasonable suspicion of criminal activity) and (2) facts justifying an officer's pre-arrest search of a suspect's body and area of immediate control in order to dispel a fear of being harmed by weapons during the course of the investigation (reasonable belief that the suspect is armed and dangerous). An officer could have a reasonable belief that he needs to stop and question some suspect without being justified in the belief that his safety is at risk in doing so. This distinction is important because "[w]e will not condone the use of a Terry protective search for weapons as a mere pretext to search for evidence" during the course of a legitimate investigative stop. D.D. v. State, 668 N.E.2d 1250, 1254 (Ind.Ct.App.1996).
[3] Though our supreme court ruled that the investigative stop of Williams exceeded constitutional limits, it upheld his convictions since there was enough additional evidence not obtained as a result of the illegal Terry stop to render the error in admitting evidence harmless. See id. at 99.
[4] In examining the totality of the circumstances, we must look not only at the quantity of facts supposedly giving rise to a reasonable suspicion but also at the quality of those facts. See Johnson v. State, 659 N.E.2d 116, 121 (Ind.1995).
[5] There will certainly be situations in the future, however, where an article of clothing may be significant to an analysis of the totality of circumstances.
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602 F.Supp. 1113 (1985)
Bruce SPRINGSTEEN, Sweet Summer Night Music, See This House Music, PGP Music, Brockman Music, Cass County Music Company, Kortchmar Music, Red Cloud Music Company, Jeddrah Music, and Night Kitchen Music, Plaintiffs,
v.
PLAZA ROLLER DOME, INC., and Gerald E. Manuel, Defendants,
v.
AMERICAN SOCIETY OF COMPOSERS, AUTHORS, AND PUBLISHERS, Additional Defendant on Counterclaim.
Civ. No. C-84-11-R.
United States District Court, M.D. North Carolina, Rockingham Division.
January 30, 1985.
Michael E. Weddington, Raleigh, N.C., for plaintiffs.
John R. Erwin and David M. Clark, Greensboro, N.C., for Plaza Roller and Manuel.
Michael E. Weddington, Raleigh, N.C., for American Society of Composers, etc.
MEMORANDUM OPINION
BULLOCK, District Judge.
Plaintiffs in this copyright infringement action are ten copyright owners and members *1114 of the American Society of Composers, Authors, and Publishers ("ASCAP"), seeking monetary damages and injunctive relief against Defendants Plaza Roller Dome, Inc., and Gerald E. Manuel for their allegedly unauthorized transmission via radio and speaker system of Plaintiffs' copyrighted compositions. The unlawful transmissions allegedly were made at the Plaza Putt-Putt golf course in Laurinburg, North Carolina, which is owned and controlled by Defendants. This action arises under the federal copyright laws, 17 U.S.C. § 101 et seq. Defendants have filed an answer and counterclaim based on allegations arising from the same transaction. Pending before the court are the parties' cross-motions for summary judgment as to whether Defendants' Putt-Putt course falls within the 17 U.S.C. § 110(5) exemption to the copyright laws. For the reasons set forth below, Defendants' motion for summary judgment will be granted, Plaintiffs' cross-motion for summary judgment will be denied, and Plaintiffs' six causes of action will be dismissed.
Factual Background
The complex owned and controlled by Defendant Plaza Roller Dome, Inc., consists of an indoor roller rink and an adjacent outdoor miniature golf course and is located at the College Plaza Shopping Center in Laurinburg, North Carolina. Defendant Gerald E. Manuel is the president and principal shareholder of Plaza Roller Dome, Inc. The genesis of the present dispute between the two parties was the October 15, 1980, initialing of a licensing agreement between Defendants and ASCAP whereby Defendants would be entitled to perform musical compositions by ASCAP's members. The agreement was the result of a long, arduous, and often bitter negotiating process; it provided for ASCAP to settle any and all claims of copyright infringement against the Defendants through October 14, 1980, for the payment of $500.00, and Defendants agreed to pay $300.00 per year for the privilege of performing musical compositions by ASCAP's members thereafter. Defendants claim that they understood and were led to believe by ASCAP that the settlement covered both the roller rink and the Putt-Putt course. Plaintiffs disagree, claiming that the agreement does not cover the Putt-Putt course.
Shortly after the October 15, 1980, signing of the licensing agreement, ASCAP, as agent for Plaintiffs, approached Defendants and insisted that the Defendants pay an additional fee in order to license the Putt-Putt course. Defendants contend that Plaintiffs, through their agent ASCAP, were well aware of the scope of the initial agreement, and that ASCAP, on behalf of Plaintiffs, threatened suit and ultimately brought about the institution of this action in order to coerce the Defendants into paying for privileges to which they were already entitled under the 1980 agreement. This course of action was pursued by Plaintiffs and ASCAP, the Defendants contend, to punish them for being tough negotiators in the discussions leading up to the agreement. As a result, when Plaintiffs instituted this litigation, Defendants filed their counterclaim alleging state law causes of action sounding in fraud, deceit, intentional harassment, and unfair trade practices.
The specific infringements complained of by Plaintiffs are alleged to have arisen from the performance, via radio and speaker system, of copyrighted musical compositions at Defendants' Putt-Putt course on August 27, 1983. The radio and speaker system at the Putt-Putt course consists of a radio receiver wired to six separate speakers mounted on light poles interspersed over the 7,500 square foot area of the course. The Defendants contend (and are not controverted by Plaintiffs) that the speakers are very unsophisticated, do not project well, and can be heard without distortion only at a close proximity thereto. They argue that this lack of sophistication, inferior to many home systems, and the limited revenue generated by the Putt-Putt course ($24,308.00 over the six-year period ending July 31, 1983 or slightly over $4,000.00 per yearor less than 3% of the gross revenue of the Plaza Roller Dome) *1115 support their contention that the course is not of sufficient size to justify, as a practical matter, a subscription to a commercial background music system and thus is exempt under Section 110(5).[1]
Discussion
Section 106(4) of Title 17 of the United States Code grants copyright owners the exclusive rights publicly to perform, or authorize the performance of, their copyrighted works. Pursuant to this provision of the copyright law, Plaintiffs, through ASCAP, received licensing fees from radio stations for the performance of their copyrighted works. Plaintiffs and ASCAP now claim that the "further transmission or performance" of its members' copyrighted works via a radio receiving apparatus "not of a kind commonly used in private homes" by the Plaza Roller Dome and Putt-Putt golf course constitutes copyright infringement. Defendants contend that their use of Plaintiffs' copyrighted materials falls within the 17 U.S.C. § 110(5) exemption to the copyright laws.
The Supreme Court, in Twentieth Century Music Corp. v. Aiken, 422 U.S. 151, 95 S.Ct. 2040, 45 L.Ed.2d 84 (1975), created an exemption to the copyright laws for small business establishments, noting that the absence of such an exemption "would result in a regime of copyright law that would be both wholly unenforceable and highly inequitable." Id. at 162, 95 S.Ct. at 2047. Specifically, the court held that the owner and operator of a chain of fast-food restaurants in the Pittsburgh area who kept a radio with outlets to four speakers in the ceiling turned on throughout the business day for the enjoyment of the customers and employees in his downtown restaurant was exempt from coverage of the 1909 copyright laws.[2] The size of the particular restaurant in Aiken was 1,055 square feet, of which 620 square feet were open to the public; no mention of the revenues of the restaurant was included in the opinion.
In 1976, primarily as a result of this decision, Congress enacted Section 110(5) (17 U.S.C. § 110[5]) to limit the exemption from rights granted copyright owners under Section 106(4).
Section 110(5) exempts from liability:
[C]ommunication of a transmission embodying a performance or display of a work by the public reception of a transmission on a single receiving apparatus of a kind commonly used in private homes, unless
(A) a direct charge is made to see or hear the transmission; or
(B) the transmission thus received is further transmitted to the public.
The meaning of this statutory language is far from clear, and its reach has scarcely been tested in the courts. Only two reported cases, each involving virtually identical factual situations, have interpreted Section 110(5) and both have relied very heavily on the legislative history in determining whether the exemption applies in a particular factual setting. In Sailor Music v. Gap Stores, Inc., 516 F.Supp. 923 (S.D.N. Y.1981), aff'd, 668 F.2d 84 (7th Cir.1981), cert. denied, 456 U.S. 945, 102 S.Ct. 2012, 72 L.Ed.2d 468 (1982), (hereinafter "the Gap case"), the defendant was a wellknown chain of approximately 420 clothing stores with annual revenues of nearly $300 million. Plaintiffs, members of ASCAP, brought an infringement action against defendant seeking monetary damages and injunctive relief against every Gap Store in the country. It was Gap's policy to transmit for the enjoyment of its customers radio programs by means of radio receivers connected to recessed loudspeakers arranged so that the music was audible throughout their stores. The allegedly infringing acts occurred at two Gap Stores *1116 located in New York City one on Sixth Avenue and the other on Thirty-Fourth Street. In each of the stores the speakers were recessed behind wire grids in the store's ceiling and were connected to the receiver by built-in wiring. There were four speakers at the Sixth Avenue store and seven speakers at the Thirty-Fourth Street store. The two stores had areas of 2,679 and 6,770[3] square feet, respectively, and the average size of all Gap stores was 3,500 square feet.
In his consideration of whether the Section 110(5) exemption applied to the Gap Stores, Judge Gagliardi quoted at length from the House Judiciary Committee report on the 1976 copyright act. The relevant discussion from the committee report provides:
Under the particular fact situation in the Aiken case, assuming a small commercial establishment and the use of a home receiver with four ordinary loudspeakers grouped within a relatively narrow circumference from the set, it is intended that the performances would be exempt under clause (5). However, the Committee considers this fact situation to represent the outer limit of the exemption, and believes that the line should be drawn at that point. Thus, the clause would exempt small commercial establishments whose proprietors merely bring onto their premises standard radio or television equipment and turn it on for their customers' enjoyment, but it would impose liability where the proprietor has a commercial "sound system" installed or converts a standard home receiving apparatus (by agumenting [sic] it with sophisticated or extensive amplification equipment) into the equivalent of a commercial sound system. Factors to consider in particular cases would include the size, physical arrangement, and noise level of the areas within the establishment where the transmissions are made audible or visible, and the extent to which the receiving apparatus is altered or augmented for the purpose of improving the oral or visual quality of the performance for individual members of the public using those areas.
U.S.Code Cong. & Admin.News 1976, pp. 5659, 5701 (quoted by Judge Gagliardi in the Gap case, 516 F.Supp. 923, 924-25).
Applying the standard set forth above for the Gap Stores, Judge Gagliardi held that Congress clearly did not intend for stores of that size to fall within the scope of the exemption. The court, noting that the Gap Stores, with an average size of 3,500 square feet, were much larger than the public area of 620 square feet in the fast-food store at issue in Aiken (which fact situation the Committee emphasized, was to be "the outer limit" of the Section 110[5] exemption), concluded, by virtue of the size of the Gap Stores, that the radio transmissions received on the radio receivers and played via recessed loudspeakers were "further transmitted to the public," thus placing the stores outside the scope of the exemption.[4]
Judge Gagliardi found further support for his conclusion in the following statement of the Conference Committee Report:
"It is the intent of the conferees that a small commercial establishment of the type involved in Twentieth Century Music Corp. v. Aiken, 422 U.S. 151 [95 S.Ct. 2040, 45 L.Ed.2d 84] (1975), which merely augmented a home-type receiver and *1117 which was not of sufficient size to justify, as a practical matter, a subscription to a commercial background music service, would be exempt." H.Rep. No. 94-1733, 94th Cong., 2d Sess., 75 (1976), U.S.Code Cong. & Admin.News (1976), p. 5816.
516 F.Supp. at 925. Without specifying whether by size he meant the revenues of the Gap Stores, which totaled over $300 million in 1979, or the average size of each Gap store, which was nearly 3,500 square feet (indoors), Judge Gagliardi held that "[t]he Gap is `of sufficient size to justify, as a practical matter, a subscription to a commercial background music service.'" The court thus held that Gap was not a small commercial establishment whose reception and performance of radio transmissions via commonly used stereo equipment Congress intended in Section 110(5) to exempt from the category of copyright infringing uses, granted plaintiff's motion for summary judgment, and entered an order enjoining defendant's infringing use of plaintiff's copyrighted works.
The only other reported case which has interpreted the Section 110(5) exemption is Broadcast Music, Inc. v. United States Shoe Corporation, 211 U.S.P.Q. 43 (C.D. Cal.1980), aff'd, 678 F.2d 816 (9th Cir.1982) (hereinafter "BMI v. U.S. Shoe"). BMI v. U.S. Shoe, as was mentioned supra, presented a factual situation virtually identical to that presented by the Gap case. Defendant United States Shoe Corporation owned and operated a chain of more than 600 women's retail apparel stores under the name "Casual Corner." In many of its stores, radio broadcasts were played to the public through the use of a single radio receiver connected to four or more speakers mounted on the store's ceiling. The radio broadcasts included many copyrighted songs. BMI was the licensee of the public performance rights of many of the songs which were played at the facilities without BMI's permission. BMI thus brought suit against United States Shoe Corporation seeking injunctive relief and damages for defendant's unauthorized use of plaintiff's copyrighted materials. Defendant in turn contended that it was eligible for the 17 U.S.C. § 110(5) exemption and both sides submitted cross-motions for summary judgment on that issue.
The Ninth Circuit Court of Appeals upheld the district court's order granting summary judgment in favor of Plaintiffs. The court relied heavily on the Section 110(5) legislative history quoted in the Gap case, as well as on Judge Gagliardi's opinion. The court held that the Casual Corner stores exceeded the "outer limit" of the exemption (specified by the House Judiciary Committee to approximate the facts in Aiken), because each store had a commercial monaural system, with widely separated speakers of a type not used in private homes, and the size and nature of the operation justified, in the eyes of the court, the use of a commercial background music system. 678 F.2d at 817.
Turning now to the case at bar, there are several significant distinctions between the facts presented in the Gap and BMI v. U.S. Shoe cases, where the exemption was held not to apply, and the instant litigation. Plaintiffs contend that since the Aiken case was intended, according to the House Judiciary Committee Report, to "represent the outer limit of the exemption," and since the Plaza Roller Dome Putt-Putt course is both larger in area and has a greater number of speakers than did the exempted restaurant in Aiken, that the exemption clearly should not apply to Defendants' Putt-Putt facility. However, an objective assessment of the facts is much more complex than Plaintiffs' open and shut analysis.
It is true, as Plaintiffs contend, that the public area of Defendants' Putt-Putt course is larger (by a factor of 12 7,500 square feet to 620) than that of the restaurant in Aiken, and that the Putt-Putt course employed more speakers (six) than did the Aiken facility (four). The size of the allegedly offending facility and the number of speakers are not, however, standing alone, the sole or even predominant factors to consider in determining the *1118 applicability of the exemption. According to the House Judiciary Committee Report, "size, physical arrangement, and noise level of the areas within the establishment where the transmissions are made audible or visible, and the extent to which the receiving apparatus is altered or augmented for the purpose of improving the oral or visual quality of the performance" are all factors to consider in determining whether the receiving apparatus has been converted into the equivalent of a "commercial sound system"[5] so as to remove the establishment from the scope of the Section 110(5) exemption.
Applying these factors to Defendants' Putt-Putt course, the argument against applying the Section 110(5) exemption becomes much less persuasive. To begin with, ASCAP's own field representative described the sound system at Defendants' Putt-Putt facility as follows:
[S]ix speakers, attached to white posts that also provide lighting for evening Putt-Putt are equidistantly spread throughout the course. The speakers did not project very well and one needed to be in a close proximity to the speaker to hear without much distortion.
Brief in Support of Defendants' Motion for Summary Judgment Exhibit A (emphasis added).
Clearly, the noise level and audibility of songs transmitted over Defendants' loudspeakers, by Plaintiffs' own admission, is not comparable to the sound systems in the Gap case and BMI v. U.S. Shoe, and does not rise to the level or minimum quality requisite for a commercial sound system. Unlike the systems involved in those two cases, where the infringing performances were audible throughout the stores and the speakers improved the quality of the performance, the allegedy infringing performances at Defendants' Putt-Putt course were scarcely audible without distortion even at very close proximity to the speakers. Under such circumstances, the speakers could scarcely be said to have "improved the quality of the performance." Indeed, the poor quality of speakers and the outdoor nature of the course guaranteed that the quality of sound performed for customers at Defendants' course would be lower than that which was performed for customers in the Gap and Casual Corner stores. Moreover, with respect to audibility and lack of improvement in the quality of the performance via augmentation, the receiving apparatus and speakers at Defendants' Putt-Putt course are inferior to those involved in the Aiken case. Hence, when all relevant factors have been taken into account, including those set out in the House Judiciary Committee Report, Defendants' sound system does not exceed the outer limit of the exemption as specified by the fact situation in Aiken and should therefore be entitled to the exemption to the copyright laws pursuant to Section 110(5).
This conclusion is reinforced by the language of the Conference Committee Report, incorporated into the legislative history subsequent to the House Judiciary Committee Report, which stated that a small commercial establishment of the type involved in Aiken which was not of sufficient size to justify, as a practical matter, a subscription to a commercial background service, would be exempt. The courts in the Gap and BMI v. U.S. Shoe cases held that operations with 420 and 600 prosperous retail outlets, respectively, both of which did hundreds of millions of dollars of business annually, were not within the purview of the Section 110(5) exemption. This court does not contest the soundness of those opinions. However, if any operation is "not of sufficient size to justify, as a practical matter, a subscription to a commercial *1119 background music service," it is Defendants' Putt-Putt course.[6]
The restaurant involved in the Aiken case was a fast-food restaurant in Pittsburgh which operated year-round, did a brisk business, and undoubtedly generated substantial revenues. It was one of a chain of restaurants in the area. Defendants' Putt-Putt course, by contrast, is open for only roughly six months per year and rarely if ever generates over $1,000.00 per month.[7] Writing in the New York Law School Law Review, Mr. Bernard Korman, general counsel for ASCAP, correctly described the congressionally-mandated scope of the Section 110(5) exemption as follows: "it [is] a very limited exemption which ... require[s] any establishment large enough to be a potential customer of a background music service to obtain a license if it chooses to perform music broadcast by any radio station." Korman, Performance Rights in Music under Sections 110 and 118 of the 1976 Copyright Act, 22 N.Y.L.Sch.L.Rev. 521, 534 (1977).
Based on all of the factors analyzed above, this court must conclude that the Plaza Roller Dome Putt-Putt course is not of sufficient size to justify a subscription to a commercial background music service and therefore is within the scope of the Section 110(5) exemption. When due weight is given to each of the factors mentioned by Congress in determining the applicability of the exemption, the size of the course and the slightly larger number of speakers involved in the instant case vis-a-vis Aiken, standing alone, do not alter this conclusion.
Consequently, Defendants' motion for summary judgment will be granted and Plaintiffs' motion for partial summary judgment will be denied.
A judgment will be entered in accordance with this Memorandum Opinion.
NOTES
[1] The reference to commercial background music systems is not in the statute, but was indicated to be a key consideration in the legislative history, as discussed infra.
[2] Both the Supreme Court and court of appeals decisions referred to four speakers in the ceiling of the restaurant. However, the district court opinion stated that there were five separate speakers.
[3] Of which only 4,690 square feet consisted of selling area open to the public.
[4] Further, the court observed, without conclusively deciding the issue, that
the stereo apparatus used by the specified Gap stores, including built-in wiring and four or seven loudspeakers recessed in ceiling cavities, may be considered to be "standard home receiving apparatus [converted] (by augmenting it with sophisticated or expensive amplification equipment) into the equivalent of a commercial sound system." H.Rep., supra, at 87, U.S.Code Cong. & Admin.News 1976, p. 3701.
516 F.Supp. at 925.
Finally, the court held that it could not as a matter of law decide whether or not the particular components used in the two Gap Stores in question were of a type "commonly used in private homes" and declined to grant summary judgment on that basis.
[5] Whether or not a system has been transformed into the equivalent of a commercial sound system is a significant test in the legislative history because, inferentially, Congress apparently concluded that a receiving apparatus is "not of a kind commonly used in private homes" precisely when it has been transformed into the equivalent of a commercial sound system.
[6] The Putt-Putt course is, of course, only a part of a larger operation which may be of sufficient size to justify a subscription to a commercial music system, i.e., the Plaza Roller Dome complex which includes Defendants' licensed roller rink. However, since Plaintiffs seek to treat the Putt-Putt course separately for purposes of licensing, this court will likewise treat the course as analytically separate for the purpose of applying the Section 110(5) exemption.
[7] Over the six-year period from July 1977 through July 1983, Defendants' Putt-Putt course never generated revenues in excess of $5,700.00 in any six-month period.
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130 Ill. App.3d 815 (1985)
474 N.E.2d 886
KHOSROYAN MALLAH et al., Plaintiffs-Appellants,
v.
BRUNO BARKAUSKAS, Defendant-Appellee.
No. 84-340.
Illinois Appellate Court Second District.
Opinion filed February 7, 1985.
*816 Ashley S. Rose, Ltd., of Naperville, for appellants.
Lee Coleman, of Naperville, for appellee.
Reversed and remanded.
PRESIDING JUSTICE NASH delivered the opinion of the court:
Plaintiffs, Khosroyan and Tahreh Mallah, appeal from a judgment entered in a small claims action in favor of defendant, Bruno Barkauskas. Plaintiffs contend the trial court failed to apply the requirements of the statute relating to refunds of a tenant's security deposit by a landlord and that its finding defendant had substantially complied with the statute was against the manifest weight of the evidence. Plaintiffs also claim attorney fees under the statute. Ill. Rev. Stat. 1983, ch. 80, par. 101.
The agreed statement of facts by the parties pursuant to Supreme Court Rule 323(d) (87 Ill.2d R. 323(d)) establishes that defendant is the lessor of residential apartments in Naperville and entered into a lease with plaintiffs for an apartment for a term from September 1, 1982, to August 31, 1983. Monthly rental was set at $405 and a security deposit of $300 was deposited with defendant by plaintiffs. In August 1983, defendant gave notice to plaintiffs he would not renew their lease and requested surrender of the premises by September 1; plaintiffs did so on August 31.
On September 19, 1983, defendant mailed plaintiffs a letter relating to the security deposit in which he stated plaintiffs had caused damages during their occupancy of the apartment and estimated costs of repair and replacement of damaged fixtures to be $584.14, which, after deducting the security deposit, left a balance due defendant of $284.14. Defendant's letter stated a final accounting for damages would be made prior to November 1, 1983. Thirty-three days after mailing the initial letter, defendant served copies of receipts for his actual costs of repair on plaintiffs which totaled $540.80.
When defendant failed to return their security deposit, plaintiffs commenced this action in which they sought judgment for twice the amount of the security deposit plus reasonable attorney fees. Plaintiffs contended in a bench trial that defendant had failed either to refund the deposit or provide documentation for his claimed actual costs within the time required by the statute. After considering the evidence, the trial court found that the documents evidencing defendant's actual costs were sent three days late, but that was in substantial compliance with the statute, for which defendant should not be penalized. Judgment was entered for defendant, and plaintiffs appeal.
The controlling statute which we consider is section 1 of "An Act *817 in relation to security deposits * * *" (Ill. Rev. Stat. 1983, ch. 80, par. 101). It imposes certain obligations upon lessors of residential property of 10 or more units who receive a security deposit from a tenant for the payment of rent or to compensate for damage to the premises. The statute provides that no portion of the deposit may be withheld by the lessor unless he, within 30 days of the date the lessee vacated the premises, has furnished lessee with an itemized statement of damage and an estimate or actual costs of repair. If an estimate of cost is given, the lessor must provide paid receipts within 30 days of giving the estimate. If no statement of damages and paid receipts are provided, the lessor must return the security deposit in full within 45 days of the date lessee vacated the premises. The statute further provides:
"Upon a finding by a circuit court that a lessor has refused to supply the itemized statement required by this Section, or has supplied such statement in bad faith, and has failed or refused to return the amount of the security deposit due within the time limits provided, the lessor shall be liable for an amount equal to twice the amount of the security deposit due, together with court costs and reasonable attorney's fees." Ill. Rev. Stat. 1983, ch. 80, par. 101.
Plaintiffs contend that as defendant neither provided the receipts within 30 days of giving the estimate nor refunded the deposit within 45 days of vacation of the premises, plaintiffs are entitled to the full statutory award. Plaintiffs argue the trial court erred in extending the time limits of the unambiguous statute and finding substantial compliance with it by defendant.
Defendant responds that the statute did not apply, as the trial court may have determined defendant withheld the deposit for reasons other than a claim for property damage. He posits that, under the lease, the security deposit could be applied also to "defray any costs or losses caused owner by tenant" which could include attorney fees and expenses lessor might incur in enforcing the lease by terminating plaintiffs' occupancy. Defendant asserts the trial court may have based its decision upon a finding that a good faith dispute existed between the parties relating to something other than property damage so that the statute does not apply.
1, 2 This court has held that the prohibition of retention of a security deposit under the statute was not intended by the legislature to apply except where part or all of the security deposit is retained for claimed property damage. (Applegate v. Inland Real Estate Corp. (1982), 109 Ill. App.3d 986, 991, 441 N.E.2d 379.) While the statute *818 is thus not applicable to situations where there is a good-faith dispute over a deposit for reasons other than a claim for property damage, "a landlord has some burden to come forward with some evidence of a good faith dispute for other reasons in order to avoid a presumption that the deposit is being withheld because of a claim of damage." (Hayward v. Tinervin (1984), 123 Ill. App.3d 302, 306, 462 N.E.2d 896.) Nothing found in this record suggests defendant withheld the deposit for any reason other than to recover $50 expended for attorney fees and damages to the apartment. There was no evidence that the deposit was applied to unpaid rent or that there was any other pending dispute between the parties. Any contrary speculation by the trial court would have been against the manifest weight of the evidence and insufficient to defeat plaintiffs' claim.
Defendant also argues that the record reflects his good faith efforts to comply with the requirements of the statute. However, good faith does not itself justify a failure to comply with the time limitations of the statute.
3 We do not agree, however, that plaintiffs are entitled to recover the statutory penalty of twice the security deposit and attorney fees. The clear language of the statute allows a lessee the return of his security deposit in full within 45 days of vacating the premises if the landlord has failed to supply both the itemized statement of damages and paid receipts within the time limits. Defendant did fail, in this case, to provide the paid receipts within 30 days of the date he gave the estimated cost of repair to plaintiffs. However, the lessee is entitled to the double penalty of the statute only if the lessor has refused to supply the itemized statement, or has done so in bad faith, and has failed or refused to return the security deposit within the time provided. Defendant did, in good faith, provide plaintiffs with an itemized estimate of damages within 30 days of vacation of the premises, and thus the penalty provisions do not arise and plaintiffs may not recover double the amount of their deposit and attorney fees.
4 Plaintiffs were, however, entitled to the return in full of their security deposit. Although defendant timely furnished the initial estimate of damages, he failed to provide the substantiating receipts within 30 days thereafter and was then required to return plaintiffs' deposit. Defendant's remedy in the event he was unable to obtain the receipts within the required time, despite his best efforts, was to refund the deposit and commence an action for damages against plaintiffs, which would not be barred by defendant's failure to comply with the requirements of the statute on security deposits.
*819 Accordingly, the judgment of the circuit court is reversed and the cause remanded with directions that judgment for $300 and costs be entered in favor of plaintiffs.
Reversed and remanded with directions.
SCHNAKE and HOPF, JJ., concur.
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Order Michigan Supreme Court
Lansing, Michigan
September 29, 2014 Robert P. Young, Jr.,
Chief Justice
Michael F. Cavanagh
Stephen J. Markman
147972(28) Mary Beth Kelly
Brian K. Zahra
Bridget M. McCormack
David F. Viviano,
GORDON FOOD SERVICE, INC. and Justices
LIVINGSTON CAPITAL, L.L.C.,
Plaintiffs-Appellees,
v SC: 147972
COA: 312204
Livingston CC: 11-026462-AA
STATE TAX COMMISSION,
Defendant-Appellant,
and
GREEN OAK CHARTER TOWNSHIP,
Defendant-Appellee
_________________________________________/
On order of the Court, the motion for reconsideration of this Court’s February 28,
2014 order is considered, and it is DENIED, because it does not appear that the order was
entered erroneously.
I, Larry S. Royster, Clerk of the Michigan Supreme Court, certify that the
foregoing is a true and complete copy of the order entered at the direction of the Court.
September 29, 2014
d0922
Clerk
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208 B.R. 32 (1995)
In re Judit JUHASZ and Frank Juhasz, Debtors.
Bankruptcy No. 95-44361-H3-7.
United States Bankruptcy Court, S.D. Texas, Houston Division.
November 14, 1995.
*33 *34 C. David Smith, Chernosky Smith, Houston, TX, for Movant.
Gloria F. Tabor, Houston, TX, for Debtor.
Before LETITIA Z. CLARK, Chief Judge.
MEMORANDUM OPINION
LETITIA Z. CLARK, Chief Judge.
The court has considered the Motion of Beneficial Texas, Inc.'s For Relief From the Stay (Docket No. 19), together with the Motion to Avoid Non-Purchase Money Security Interest (Docket No. 26) filed by Debtors. The following are the Findings of Fact and Conclusions of Law of the court. A separate conforming Judgment will be entered. To the extent any of the Findings of Fact may be considered Conclusions of Law, they are adopted as such. To the extent any of the Conclusions of Law may be considered Findings of Fact, they are adopted as such.
Background
Debtors filed a voluntary petition under Chapter 7 of the Bankruptcy Code on June 9, 1995. Beneficial Texas, Inc. ("Beneficial") seeks relief from the automatic stay to foreclose a security interest it asserts in a 1986 Porsche 944 Turbo, VIN No. WPOAA0958GN154937 (the "Vehicle"). (Docket No. 19, at p. 2).
Debtors contend that Beneficial's claimed security interest is unperfected, or alternatively, that the lien is avoidable because it is a non-possessory, non-purchase money security interest which impairs the Debtors' exemption as a "tool of the trade" pursuant to 11 U.S.C. § 522(f)(1)(B)(ii).
Secured Status of Beneficial
Debtors entered into a loan agreement ("First Loan Document") on March 14, 1994 in the original principal amount of $7,637.04. (Beneficial Exhibit 4). The document contains a notation that the loan is secured, along with several "boxes" which were checked to indicate the type of security. (Beneficial Exhibit 4, at p. 1). The boxes marked "Motor Vehicle" and "Certain Household Items" were checked.
The First Loan Document also contains a provision for the granting of a security interest in personal property. The provision reads: "To secure this loan, you give us a security interest in your personal property described below." The form contains two boxes, of which one box was checked. That box reads: "The motor vehicle(s) and attached equipment described in the Identification of Security form."
Attached to the First Loan Document is a form titled "Identification of Security" (Beneficial Exhibit 5). The form contains the VIN number and description of the Vehicle.
A Texas Certificate of Title issued on May 10, 1994 (Beneficial Exhibit 3) lists Judit Juhasz as owner of the Vehicle, and lists Beneficial Texas Inc. as first lienholder pursuant to a lien dated March 16, 1994.
Debtors entered into a second loan agreement ("Second Loan Document") on February 6, 1995 in the original principal amount of $7,637.04. (Beneficial Exhibit 1). The form of the Second Loan Document appears identical to that of the First Loan Document. The Second Loan Document reflects that a balance of $5,582.45 was paid on the prior account, and that a new loan of $2,054.59 was made.
The document contains a notation that the loan is secured, along with several boxes checked to indicate the type of security. (Beneficial Exhibit 1, at p. 1). Only the box *35 marked "Certain Household Items" was checked. The box marked "Motor Vehicle" was not checked.
The Second Loan Document contains the same provision for the granting of a security interest. The box marked "Other personal property described in the Identification of Security form" was checked. The box marked "The motor vehicle(s) and attached equipment described in the Identification of Security form" is not checked.
The Identification of Security form attached to the Second Loan Document (Beneficial Exhibit 2) contains the VIN number and description of the vehicle.
The Identification of Security form contains the following language: "You have signed a Loan Agreement on the date shown above and given a security interest in personal property. This form is incorporated by reference into the Loan Agreement. You are listing below an individual itemization and your estimate of the market value of the personal property (`property') that secures your loan."
The issue of whether a security interest attaches to the Vehicle is governed by the Uniform Commercial Code-Secured Transactions chapter, Tex.Bus. & Com.Code Art. 9.
A security interest attaches to collateral in the possession of a debtor if the debtor has signed a security agreement which contains a description of the collateral, value has been given, and the debtor has rights in the collateral. Tex.Bus. & Com.Code § 9.203(a).
A description of personal property is sufficient for the purpose of Article 9 if it reasonably identifies what is described. Tex.Bus. & Com.Code § 9.110; Crow-Southland Joint Venture No. 1 v. North Fort Worth Bank, 838 S.W.2d 720 (Tex.App. Dallas, err. den.).
The indication of the Vehicle's Vehicle Identification Number on both "Identification of Security" forms uniquely describes the Vehicle. The court concludes that the collateral was sufficiently described for the lien of Beneficial to attach.
Lien Avoidance
The Bankruptcy Code provides for the avoidance of a judicial lien to the extent the lien impairs an exemption of the debtor if such lien is a nonpossessory nonpurchase money security interest in any implements, professional books, or tools of the trade of the debtor or the trade of a dependent of the debtor. 11 U.S.C. § 522(f)(1)(B)(ii).
Debtors' Schedule C (Docket No. 9) indicates that the Debtors have elected the state scheme of exemptions. Debtors listed the Vehicle as exempt pursuant to Tex.Prop. Code § 42.001. No party in interest filed a timely objection to the Debtors' claim of exemptions.
Section 42.001 of the Texas Property Code allows a family to exempt personal property of an aggregate fair market value of no more than $60,000, and of the types listed in Section 42.002. Section 42.002 contains among the types listed, vehicles and tools of the trade.
Under the Texas exemption for tools of the trade, the exemption must be of items fairly belonging to the trade. Those items which have merely general value and use in business are not included within the scope of the exemption. In re Neal, 140 B.R. 634 (Bankr.W.D.Tex.1992).
A debtor may not avoid a lien in a motor vehicle as a tool of the trade where the vehicle is not peculiarly adapted to the debtor's trade. In re Hrncirik, 138 B.R. 835 (Bankr.N.D.Tex.1992); In re Weiss, 92 B.R. 677 (Bankr.N.D.Tex.1988).
In the instant case, the Vehicle is not particularly adapted to Debtor's trade. Debtor testified that he is in the business of buying and selling jewelry and collectibles. He drives the Vehicle to call on customers and to conduct appraisals of the items he buys and sells, as well as to deliver goods. The vehicle is an ordinary 1986 Porsche 944 Turbo. There is no modification of the car that adapts it for particular use as a delivery vehicle. The court concludes that the Vehicle is not a tool of the trade within the meaning of 11 U.S.C. § 522(f)(1)(B)(ii).
*36 Relief from Stay
Under Section 362(d) of the Bankruptcy Code, the court shall grant relief from the automatic stay, such as terminating, annulling, modifying, or conditioning the stay, for cause, including the lack of adequate protection (Section 362(d)(1)), or if the debtor does not have an equity in the property, and the property is not necessary to an effective reorganization (Section 362(d)(2)).
Ron Gilham, the representative of Beneficial, testified that the average retail value for a 1986 Porsche 944 Turbo is $10,775.00. The average loan value is $7,775.00.
The proper measurement of the value to the Debtors of retaining and using the Vehicle can best be measured by what they would have to pay to purchase another 1986 Porsche, which is the average retail value of the Vehicle. In re Rash, 31 F.3d 325 (5th Cir.1994).
Gilham testified that the payment history (Beneficial Exhibit 6) reflects an amount owing of $8,268.00 as of the date of filing of the petition in this bankruptcy case. The note calls for Debtors to pay the balance in thirty equal monthly installments.
The court concludes that the Debtor has equity in the property, and thus the stay does not lift pursuant to Section 362(d)(2).
Judit Juhasz testified that the Debtors are not able to make periodic payments on the debt at the present time because Debtors' income from their business is low. She testified that Debtors maintain full insurance coverage on the Vehicle.
An undersecured creditor may be entitled to adequate protection to ensure against the decline in the value of its collateral. However, an undersecured creditor is not entitled to receive postpetition "interest on its collateral during the stay to assure adequate protection under 11 U.S.C. s 362(d)(1)." In re Delta Resources, Inc., 54 F.3d 722 (11th Cir.1995) (citing United Sav. Ass'n v. Timbers of Inwood Forest Assocs., Ltd., 484 U.S. 365, 108 S.Ct. 626, 98 L.Ed.2d 740 (1988)). By contrast, an oversecured creditor is entitled to receive postpetition interest during the stay to assure adequate protection. Id.
While noting that an oversecured creditor is entitled to postpetition interest, the court in Delta Resources declined to extend Timbers to require that an oversecured creditor receive periodic postpetition interest payments to ensure against the diminution in value of its equity cushion as a part of adequate protection. The court held that periodic postpetition adequate protection payments need only protect against diminution in the value of the collateral, i.e. depreciation. 54 F.3d 722, at 730.
There is no evidence before the court regarding the level of depreciation of the Vehicle. Thus the court declines at this time to order periodic postpetition payments as adequate protection of Beneficial's interest. The court notes that the claim of Beneficial continues to accrue postpetition interest, and thus at a later date, the Debtors may not have equity in the property. Thus the court will deny the motion for relief from the stay without prejudice to a later refiling upon a change in circumstances or a showing of the decline in value of the Vehicle.
Based on the foregoing, the court will enter a separate Judgment denying the Motion to Avoid Non-Purchase Money Security Interest (Docket No. 26) filed by Debtors, and denying without prejudice the Motion of Beneficial Texas, Inc.'s For Relief From the Stay (Docket No. 19).
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166 F.3d 1206
Michael Smallsv.Pennsylvania Board of Probation & Parole, Attorney General of PA
NO. 97-7623
United States Court of Appeals,Third Circuit.
August 19, 1998
1
Appeal From: M.D.Pa.
2
Affirmed.
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UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
____________________________________
)
MALLA POLLACK, )
)
Plaintiff, )
)
v. ) Civil Action No. 10-0866 (ABJ)
)
JAMES C. DUFF, )
Director of the Administrative Office of )
the United States Courts, et al., )
)
Defendants. )
____________________________________)
MEMORANDUM OPINION
Plaintiff Malla Pollack, a resident of Kentucky, was deemed ineligible to apply for a
position at the Administrative Office of the United States Courts (“AO”) because the job vacancy
announcement was restricted to current AO employees and residents of the District of Columbia
metropolitan area. Compl. ¶¶ 4, 13, 16 [Dkt. # 1]. She has filed this action against the AO
claiming that the geographical limitation on the pool of applicants violated her constitutional
right to travel, the Privileges and Immunities Clause in Article IV, the Fifth Amendment, the
Fourteenth Amendment, and “the structure and purpose of the Constitution as a whole.” Id. ¶¶ 1,
11–13.
Defendants filed a motion to dismiss pursuant to Federal Rules of Civil Procedure
12(b)(1) and 12(b)(6), or in the alternative for summary judgment, on November 1, 2011. Defs.’
Mot. to Dismiss [Dkt. # 9] (“Defs.’ Mot.”); Mem. of P. & A. [Dkt. # 9] (“Defs.’ Mem.”). On
August 24, 2011, the Court granted defendants’ motion to dismiss for lack of subject matter
jurisdiction, on the grounds that the government had not waived its sovereign immunity from
1
suit. Mem. Op. [Dkt. # 18]. In light of its ruling, the Court did not go on to address the merits of
the dispute, and it did not reach defendants’ alternative jurisdictional argument.
Plaintiff appealed the dismissal of her case. Notice of Appeal [Dkt. # 19]. The U.S.
Court of Appeals for the District of Columbia Circuit ruled that the AO was not immune, and it
remanded the case for further proceedings. Mandate and Judgment [Dkt. # 22]. Since the
motion to dismiss was fully briefed by the parties, 1 that motion is now ripe for decision. The
Court finds that the AO’s decision to limit the geographic area of consideration for certain of its
job vacancies did not offend the Constitution. The AO’s action did not prevent, deter, impede,
burden, or penalize travel by the plaintiff to or from Kentucky, the District of Columbia, or
anywhere else.
BACKGROUND
Plaintiff Malla Pollack, an attorney who lives in Kentucky, applied for a job as an
attorney with the AO. Compl. ¶¶ 4, 11. The job announcement at issue, number 10-OFS-
300782, was open to the following applicants: “Judiciary wide and All Sources – Washington
Metropolitan Area.” Id. ¶¶ 10–12. This meant that the AO would consider current judiciary
employees regardless of their location, and it would consider non-judiciary employees not
claiming a preference entitlement located in the Washington, D.C. metropolitan area. Id. ¶¶ 11,
12, 16. Pollack applied for the position as a non-judiciary employee, and the AO rejected the
application because she does not reside within the Washington metropolitan area. Id. ¶¶ 11, 13.
Pollack sued, claiming that the AO’s limitation of the applicant pool to a geographic area
1 See Defs.’ Mot. and Defs.’ Mem.; Pl.’s Opp. to Defs.’ Mot. to Dismiss & Pl.’s Cross
Mot. for an Order Requiring Resp. to Pl.’s Disc. Reqs. [Dkt. # 10] (“Pl.’s Opp.”); Consolidated
Reply in Supp. of Defs.’ Mot. to Dismiss and Opp. to Pl.’s Cross Mot. for a Disc. Order [Dkt. #
13] (“Defs.’ Reply”); Pl.’s Reply in Supp. of Pl.’s Cross Mot. for an Order Requiring Resp. to
Pl.’s Disc. Reqs. and (If the Ct. So Orders) Sur-Reply to Defs.’ Mot. to Dismiss [Dkt. # 16].
2
violated her constitutional right to travel. Id. ¶ 1. Aside from claiming sovereign immunity,
defendants moved to dismiss for failure to state a claim, or in the alternative for summary
judgment, because the geographic limitation in the AO’s job announcement does not violate the
Constitution. Defs.’ Mem. at 16–23.
STANDARD OF REVIEW
In evaluating a motion to dismiss under either Rule 12(b)(1) or 12(b)(6), the Court
must “treat the complaint’s factual allegations as true . . . and must grant plaintiff ‘the benefit
of all inferences that can be derived from the facts alleged.’” Sparrow v. United Air Lines,
Inc., 216 F.3d 1111, 1113 (D.C. Cir. 2000), quoting Schuler v. United States, 617 F.2d 605, 608
(D.C. Cir. 1979) (citations omitted). Nevertheless, the Court need not accept inferences
drawn by the plaintiff if those inferences are unsupported by facts alleged in the complaint, nor
must the Court accept plaintiff’s legal conclusions. Browning v. Clinton, 292 F.3d 235, 242
(D.C. Cir. 2002).
I. Subject Matter Jurisdiction
Under Rule 12(b)(1), the plaintiff bears the burden of establishing jurisdiction by a
preponderance of the evidence. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 561
(1992); Shekoyan v. Sibley Int’l Corp., 217 F. Supp. 2d 59, 63 (D.D.C. 2002). Federal courts are
courts of limited jurisdiction and the law presumes that “a cause lies outside this limited
jurisdiction.” Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994); see
also Gen. Motors Corp. v. Envtl. Prot. Agency, 363 F.3d 442, 448 (D.C. Cir. 2004) (“As a
court of limited jurisdiction, we begin, and end, with an examination of our jurisdiction.”).
Because “subject-matter jurisdiction is an ‘Art[icle] III as well as a statutory requirement, . . .
no action of the parties can confer subject-matter jurisdiction upon a federal court.’” Akinseye
3
v. Dist. of Columbia, 339 F.3d 970, 971 (D.C. Cir. 2003), quoting Ins. Corp. of Ir., Ltd. v.
Compagnie des Bauxites de Guinee, 456 U.S. 694, 702 (1982).
When considering a motion to dismiss for lack of jurisdiction, unlike when deciding
a motion to dismiss under Rule 12(b)(6), the court “is not limited to the allegations of the
complaint.” Hohri v. United States, 782 F.2d 227, 241 (D.C. Cir. 1986), vacated on other
grounds, 482 U.S. 64 (1987). Rather, a court “may consider such materials outside the
pleadings as it deems appropriate to resolve the question whether it has jurisdiction to
hear the case.” Scolaro v. D.C. Bd. of Elections & Ethics, 104 F. Supp. 2d 18, 22 (D.D.C.
2000), citing Herbert v. Nat’l Acad. of Sciences, 974 F.2d 192, 197 (D.C. Cir. 1992); see also
Jerome Stevens Pharms., Inc. v. Food & Drug Admin., 402 F.3d 1249, 1253 (D.C. Cir. 2005).
II. Failure to State a Claim
“To survive a [Rule 12(b)(6)] motion to dismiss, a complaint must contain
sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks omitted); see also Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is facially plausible when the
pleaded factual content “allows the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. “The plausibility standard is not
akin to a ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant
has acted unlawfully.” Id. “[W]here the well-pleaded facts do not permit the court to infer
more than the mere possibility of misconduct, the complaint has alleged – but it has not
‘show[n]’ – ‘that the pleader is entitled to relief.’” Id. at 679, quoting Fed. R. Civ. Pro.
8(a)(2). A pleading must offer more than “labels and conclusions” or a “formulaic recitation of
the elements of a cause of action,” id. at 678, quoting Twombly, 550 U.S. at 555, and “the tenet
4
that a court must accept as true all of the allegations contained in a complaint is inapplicable to
legal conclusions.” Id. In ruling upon a motion to dismiss, a court may ordinarily consider
only “the facts alleged in the complaint, documents attached as exhibits or incorporated by
reference in the complaint, and matters about which the Court may take judicial notice.”
Gustave-Schmidt v. Chao, 226 F. Supp. 2d 191, 196 (D.D.C. 2002) (citations omitted).
III. Summary Judgment
Summary judgment is appropriate “if the movant shows that there is no genuine dispute
as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P.
56(a). The party seeking summary judgment bears the “initial responsibility of informing the
district court of the basis for its motion, and identifying those portions of the pleadings,
depositions, answers to interrogatories, and admissions on file, together with the affidavits, if
any, which it believes demonstrate the absence of a genuine issue of material fact.” Celotex
Corp. v. Catrett, 477 U.S. 317, 323 (1986) (internal quotation marks omitted). To defeat
summary judgment, the non-moving party must “designate specific facts showing that there is a
genuine issue for trial.” Id. at 324 (internal quotation marks omitted). The existence of a factual
dispute is insufficient to preclude summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 247–48 (1986). A dispute is “genuine” only if a reasonable fact-finder could find for the
non-moving party; a fact is only “material” if it is capable of affecting the outcome of the
litigation. Id. at 248; Laningham v. U.S. Navy, 813 F.2d 1236, 1241 (D.C. Cir. 1987). In
assessing a party’s motion, the court must “view the facts and draw reasonable inferences ‘in the
light most favorable to the party opposing the summary judgment motion.’” Scott v. Harris, 550
U.S. 372, 378 (2007) (alterations omitted), quoting United States v. Diebold, Inc., 369 U.S. 654,
655 (1962) (per curiam).
5
ANALYSIS
I. The AO Personnel Act
The Administrative Office of the United States Courts Personnel Act of 1990 (“AO
Personnel Act”) governs employment matters within the federal judiciary and authorizes the
judiciary to manage its own personnel matters. In re Golinski, 587 F.3d 956, 962 & n.6 (9th Cir.
2009). Congress passed the Act in 1990 to remove control over employment decisions of the
judiciary from the executive branch. Id. at 962 n.6 (noting that before the Act, the United States
courts were mostly free of Executive Branch supervision except in the area of personnel matters,
and Congress passed the Act to “correct that asymmetry”). The Act requires the Director of the
AO to establish a personnel management system for the Administrative Office that provides for
the appointment, pay, promotion, and assignment of all employees on the basis of merit.
Administrative Office of the United States Courts Personnel Act of 1990, Pub. L. No. 101-474, §
3(a), 104 Stat. 1097 (1990) (appearing in notes to 28 U.S.C. § 602).
Section 3(a)(7) of the AO Personnel Act requires the judiciary’s personnel management
system to “include the principles set forth in section 2301(b) of title 5, United States Code.”
That provision requires that:
[r]ecruitment should be from qualified individuals from
appropriate sources in an endeavor to achieve a work force from
all segments of society, and selection and advancement should be
determined solely on the basis of relative ability, knowledge, and
skills, after fair and open competition which assures that all receive
equal opportunity.
5 U.S.C. § 2301(b)(1) (2012).
The AO implemented this requirement through its Merit Recruitment Plan. Decl. of
Cheri Thompson Reid [Dkt. # 9-1] (“Reid Decl.”), Ex. 1 to Defs.’ Mot. ¶ 5. The Merit
Recruitment Plan gives an AO official who has a vacancy to fill discretion to define the
6
geographic “area of consideration” from which the AO will accept candidates. Id. Specifically,
Section E of the Merit Recruitment Plan states that the “area of consideration must be large
enough to attract a reasonable number of qualified candidates to provide fair and open
competition for the position. . . . The minimum area of consideration is AO permanent status
employees within a geographic location.” Id., quoting Human Resources Manual, Chap. II,
Subch. D, Sec. E. According to the AO, a selecting official may choose to limit an area of
consideration for a particular vacancy because “the larger the applicant pool the greater the
expenditure of resources may be” and a smaller area of consideration “will attract a reasonable
number of qualified candidates to provide fair and open competition for the position.” Id.
The AO Personnel Act also governs employment complaints by judiciary employees and
applicants. It provides that the AO’s personnel system must “prohibit discrimination on the basis
of race, color, religion, age, sex, national origin, political affiliation, marital status, or
handicapping condition.” AO Personnel Act § 3(a)(9). It also requires the AO to establish
regulations that provide procedures for resolving discrimination complaints by employees and
applicants. Id. Section 3(g) of the Act states:
Nothing in this Act shall be construed to abolish or diminish any
right or remedy granted to employees in the Administrative Office
by any law prohibiting discrimination in Federal employment on
the basis of race, color, religion, age, sex, national origin, political
affiliation, marital status, or handicapping condition, except that,
with respect to any such employees and applicants for
employment, any authority granted under any such law to the
Equal Employment Opportunity Commission, the Office of
Personnel Management, the Merit Systems Protection Board, or
any other agency in the executive branch, shall be exercised by the
Administrative Office.
Id. § 3(g).
7
In response to this requirement, the AO created the Fair Employment Practices System
(“FEPS”), which provides for “the prompt, fair, and impartial resolution of allegations of
discrimination” by AO employees and applicants. See Administrative Office of the United
States Courts, 2 AO Manual § 120.20 [Dkt. # 9-2], Ex. 2 to Defs.’ Mot. FEPS requires the AO
to establish a personnel system prohibiting discrimination of the basis of “race, color, religion,
age, sex, national origin, political affiliation, marital status, or handicapping condition,”
including providing for the “prompt, fair, and impartial resolution of allegations of
discrimination.” Id. §§ 120.10 (Purpose), 120.20 (Scope).
II. Judicial Review
Before addressing the merits of Pollack’s constitutional claim, the Court notes that its
ruling of August 24, 2011 “rested solely on the ground that the defendants have sovereign
immunity,” but that on appeal, defendants urged the appeals court to rule “on the alternative
ground that the [AO Personnel Act] evidences a clear congressional intention to preclude judicial
review” of Pollack’s claims. Pollack v. Hogan, 703 F.3d 117, 121 (D.C. Cir. 2012).
Defendants’ motion to dismiss for lack of jurisdiction did not address this argument at length, but
it did assert that FEPS is the sole source of any remedy available to plaintiff. Defs.’ Mem. at 16.
In her opposition, plaintiff responded that Congress must use clear statutory language if it seeks
to bar judicial review of a constitutional claim, and that there is no statement of Congressional
intent to do so in this instance. Pl.’s Opp. at 5 & n.2, quoting Webster v. Doe, 486 U.S. 592, 603
(1988) (“where Congress intends to preclude judicial review of constitutional claims its intent to
do so must be clear”).
The AO Personnel Act prohibits “discrimination on the basis of race, color, religion, age,
sex, national origin, political affiliation, marital status, or handicapping condition.” AO
8
Personnel Act § 3(a)(9). FEPS is the AO’s procedural mechanism for resolving complaints
alleging those sorts of discrimination. Ex. 2 to Defs.’ Mot. § 120.10. Defendants argue that
Section 3(g) of the Act reflects that Congress intended FEPS to be the exclusive resolution
procedure for discrimination claims by AO employees and applicants. Defs.’ Mem. at 4–5,
quoting AO Personnel Act § 3(g) (granting the AO authority to exercise authority “granted under
any such law to the Equal Employment Opportunity Commission, the Office of Personnel
Management, the Merit Systems Protection Board, or any other agency in the executive branch”
to address discrimination claims as set forth in the statute). Defendants also argue that the fact a
complaining employee or applicant does not have the right to appeal a final decision by the AO
under FEPS supports their position that Pollack cannot sue. Defs.’ Mem. at 6 n.5, quoting Ex. 2
to Defs.’ Mot., § 120.100(1)(b).
But Pollack is not protesting the sort of discrimination covered by the statute. She does
not claim discrimination “on the basis of race, color, religion, age, sex, national origin, political
affiliation, marital status, or handicapping condition.” AO Personnel Act § 3(a)(9). Rather, she
claims the AO discriminated against her as a resident of Kentucky and, in doing so, violated her
constitutional right to travel. Thus, it does not appear that Section 3(g) and FEPS apply in this
case. The Court need not resolve this issue, however, because it ultimately concludes that the
AO’s geographic limitation in job announcement number 10-OFS-300782 does not violate
Pollack’s constitutional right to travel.
III. The AO Does Not Violate Pollack’s Constitutional Right to Travel by Limiting the
Area of Consideration
Pollack contends that by limiting the area of consideration for the disputed job
announcement to the Washington, D.C. metropolitan area, the AO violated a constitutional right
to travel that is embodied in the Privileges and Immunities Clause of Article IV, the Fifth
9
Amendment, the Fourteenth Amendment, and/or “the structure and purpose of the Constitution
as a whole.” Compl. ¶ 1. She explains that the complaint “mentions” all of those provisions
because “the United States Supreme Court has repeatedly shifted its analysis of the constitutional
right to travel,” and she does not “wish to plead herself out of court by unnecessarily tying her
complaint to any one element of the Constitution.” Pl.’s Opp. at 9.
There is no dispute that the right to travel is a “virtually unconditional personal right,
guaranteed by the Constitution to us all.” Saenz v. Roe, 526 U.S. 489, 498 (1999) (internal
citations and quotation marks omitted); see also Defs.’ Mem. at 16; Pl.’s Opp. at 8. The
Supreme Court has addressed the right to travel in various contexts over nearly 150 years of
jurisprudence. See, e.g., Crandall v. State of Nev., 73 U.S. (6 Wall.) 35 (1867) (holding
unconstitutional a state tax on persons leaving or passing through Nevada); United States v.
Guest, 383 U.S. 745 (1966) (holding that the district court erred in dismissing part of an
indictment concerning a private conspiracy to prevent African-American citizens from using
state highways); Shapiro v. Thompson, 394 U.S. 618 (1969), overruled on other grounds by
Edelman v. Jordan, 415 U.S. 651 (1974) (striking down as unconstitutional state statutes that
denied any welfare assistance whatsoever to persons residing in the state for less than one year).
And, as plaintiff has indicated, the Court has relied on multiple provisions of the Constitution
when recognizing this fundamental right. See Crandall, 73 U.S. (6 Wall.) 35 (recognizing the
right to travel in the general principles of the Constitution instead of relying on a particular
provision of the Constitution); Shapiro, 394 U.S. 618 (analyzing right to travel under the Equal
Protection clause of the Fourteenth Amendment); Saenz, 526 U.S. at 498 (“The word ‘travel’ is
not found in the text of the Constitution. Yet the ‘constitutional right to travel from one State to
another’ is firmly embedded in our jurisprudence.”). See also Christopher S. Maynard, Nine-
10
Headed Caesar: The Supreme Court’s Thumbs-Up Approach to the Right to Travel, Case W.
Reserve L.R., 51 CWRLR 297 (2000) (setting forth the history of the right as recognized by the
Supreme Court).
Most recently, the Supreme Court addressed the right to travel in Saenz v. Roe, 526 U.S.
at 498 (striking down a California statute that limited new residents’ welfare benefits to the
amount they would have received in the state of their prior residence). In Saenz, the Court held
that the constitutionally protected right to travel comprises at least three components: the right to
free interstate movement (i.e., the right to travel through a state), the right to travel to a state
intending to return home (i.e., the right to visit another state), and the right of a newly-arrived
citizen (i.e., the right to move to another state). Saenz, 526 U.S. at 500–04. But this case does
not implicate any of those concerns. Pollack does not complain that the AO violated her right to
travel through or to visit the Washington, D.C. metropolitan area. Nor does she complain that
the AO’s actions discriminated against her as a newly-arrived citizen of the District or its
neighboring states – she still lives in Kentucky. Rather, she complains that the AO violated her
right to travel by refusing to consider her application for a job with the AO in Washington, D.C.
because she is a resident of Kentucky. Compl. ¶¶ 1, 4, 11.
So Saenz does not appear to apply, and plaintiff candidly acknowledges that she has
found no case law addressing the right to travel in the factual context of this case. Pl.’s Opp. at
8. She argues nonetheless that the right to travel is “expansive” and includes “the right to be
given equal consideration for possible employment by the federal government in localities to
which she desires to relocate.” Id. at 9, 10. In making this argument, she encourages the Court
to analyze her claim “pursuant to other constitutional-right-to-travel cases.” Id. at 10.
11
It is true that in Saenz, the Supreme Court did not limit the components of the right to
travel to the three examples it listed. But after reviewing the specific constitutional provisions
and authorities that plaintiff cites, and considering the “structure and purpose of the constitution
as a whole,” the Court finds that restricting the pool of applicants for a federal position to
residents of nearby states does not violate any right found in the constitution.
A. Plaintiff Fails To State a Violation of the Article IV Privilege and Immunities
Clause.
Article IV of the Constitution states that the “The Citizens of each State shall be entitled
to all Privileges and Immunities of Citizens in the several States.” U.S. Const. Art. IV, § 2, cl. 1.
Plaintiff claims that this clause protects the right she asserts here because “to come to the seat of
[the federal] government” is part of the fundamental right to travel protected by the clause. Pl.’s
Opp. at 11, citing Slaughter House Cases, 83 U.S. (16 Wall.) 36, 79 (1872). Defendants argue
first that the clause applies only to the states and does not apply to the federal government and its
officers. Defs.’ Mem. at 19, citing Frazier v. Heebe, 788 F.2d 1049, 1052 (5th Cir. 1986), rev’d,
482 U.S. 641 (1987). The case law in this Circuit confirms that the Privileges and Immunities
Clause does not apply to the federal government. See Duehay v. Acacia Mut. Life Ins. Co., 105
F.2d 768, 775 (D.C. Cir. 1939) (“Section 2 of Article IV . . . is a limitation upon the powers of
the states and in no way affects the powers of Congress over the territories and the District of
Columbia.”)
Plaintiff does not present authority to the contrary, but she maintains that she “reads the
clear language of the Privileges and Immunities Clause of Article IV as applying to all
government action – federal and state.” Pl.’s Opp. at 9 n.10. The Court holds that the Privileges
and Immunities Clause of Article IV applies only to the states and does not apply to the federal
government, so plaintiff has not stated a claim under that clause. But even if the clause did apply
12
to the federal government, the right that Pollack claims the AO violated is not a privilege or
immunity protected by that clause.
The Supreme Court has explained that the privileges and immunities under Article IV
“are only such as arise out of the nature and essential character of the national government, or are
specifically granted or secured to all citizens or persons by the Constitution of the United States.”
Twining v. State of N.J., 211 U.S. 78, 97 (1908), overruled on other grounds by Malloy v.
Hogan, 378 U.S. 1 (1964). These rights include the right to pass freely from state to state, the
right to petition Congress for a redress of grievances, the right to vote for national officers, the
right to enter the public lands, the right to be protected against violence while in the lawful
custody of a United States marshal, and the right to inform U.S. authorities of violation of its
laws. Id. Put another way, the privileges and immunities in Article IV are “[o]nly with respect
to those ‘privileges’ and ‘immunities’ bearing upon the vitality of the Nation as a single entity.”
Baldwin v. Fish & Game Comm’n, 436 U.S. 371, 383 (1978). Those privileges and immunities
that do not bear on “the vitality of the Nation as a single entity” are not implicated.
Plaintiff claims the AO violated her right under the Article IV Privileges and Immunities
Clause to “become a citizen of any state of the Union by a bona fide residence therein, with the
same rights as other citizens of that State.” Pl.’s Opp. at 11, citing The Slaughter House Cases,
83 U.S. (16 Wall.) at 80. But the AO’s geographic limit on its applicant pool for a single job
announcement does not prevent Pollack from moving to the Washington D.C. metropolitan area.
She is free to relocate to the area.
Pollack also claims the AO violated her right to “come to the seat of government.” Pl.’s
Opp. at 11, citing Slaughter House, 83 U.S. (16 Wall.) at 80. Article IV protects those privileges
and immunities that “arise out of the nature and essential character of the national government.”
13
Twining, 211 U.S. at 97. The right to come to the seat of government is one “to assert any claim
he may have upon that government, or to transact any business he may have with it.” Crandall,
73 U.S. (6 Wall.) at 44. According to plaintiff, the right to transact any business with the federal
government includes the right to be considered for employment with the federal government.
Pl.’s Opp. at 11. But the Supreme Court has also made clear that the focus of this statement in
the Slaughter House opinion “very clearly, was thus on impediments by the States on free
movement by citizens.” Guest, 383 U.S. at 766. “[T]his right is in its nature independent of the
will of any State over whose soil he must pass in the exercise of it.” Id., quoting Crandall, 73
U.S. (6 Wall.) at 44. The AO’s job announcement at issue here does not impede Pollack’s right
to interstate travel to conduct business with the federal government. Although the residency
requirement may prevent Pollack from being eligible for a particular AO job by virtue of her
current state of residency, it does not prevent her from traveling to the Washington metropolitan
area to become a resident and thereby become eligible for the specific job she seeks.
Furthermore, the AO did not set a residency requirement for all of the attorney positions open in
Washington, D.C. As Pollack alleges in her complaint, she was eligible for and did apply for
other attorney jobs within the AO. Compl. ¶ 31; see also Reid Decl. ¶ 8. The Court holds that
plaintiff’s right to relocate to the Washington metropolitan area is different from the right to be
considered for particular AO jobs before she moves to Washington. The right she asserts is the
latter, and this is not a privilege or immunity under Article IV that bears on the vitality of the
nation.
Moreover, although the Supreme Court has not addressed the question of whether the
federal government can impose a residency requirement for certain federal jobs, it has upheld
residency requirements imposed by state employers. In McCarthy v. Phila. Civil Serv. Comm’n,
14
424 U.S. 645 (1976), the Court upheld a municipal regulation that required employees of the city
to live in Philadelphia to maintain employment. In that case, a 16-year veteran of the
Philadelphia Fire Department was terminated because he moved his family out of the city to
New Jersey. Id. at 645. The Supreme Court distinguished that regulation from the types of
residency requirements that discriminate against new residents in violation of the Constitution.
Id. at 646–47; see also Shapiro, 394 U.S. at 622–24 (state law imposing one-year waiting period
to receive any welfare benefits); Dunn v. Blumstein, 405 U.S. 330, 334–35 (1973) (state law
imposing one-year waiting period to vote); Mem’l Hosp. v. Maricopa Cnty., 415 U.S. 250, 252,
261–62 (1974) (state law requiring indigents to have resided in county for previous twelve
months before receiving free non-emergency medical care); Saenz, 526 U.S.at 492–93 (state law
limiting welfare benefits for new residents). The Supreme Court held in McCarthy that this line
of cases “did not question the validity of appropriately defined and uniformly applied bona fide
residence requirements.” McCarthy, 424 U.S. at 647 (internal quotation marks and citations
omitted).
Further, this case is distinguishable from Hicklin v. Orbeck, 437 U.S. 518 (1978), which
struck down an Alaska statute that imposed a preference for hiring in-state residents over all out-
of-state residents for jobs relating to the state’s oil and gas pipelines because it violated the
Article IV Privileges and Immunities Clause. First, as stated above supra, unlike Hicklin, this
case does not involve one state discriminating against the citizens of another, so it does not
implicate the privileges and immunities protected under Article IV. Further, although AO job
announcement number 10-OFS-300782 limited eligible non-judiciary employees not claiming
any preferences to applicants in Washington, D.C., Virginia, and Maryland, it considered current
judiciary employees nationwide as eligible applicants. So although plaintiff was ineligible for
15
this particular job as a Kentucky resident, the geographic limitation in the announcement did not
limit eligibility as to all applicants outside the Washington, D.C. area. Therefore, it does not
bear upon “the vitality of the Nation as a single entity” and does not violate the Privileges and
Immunities Clause of Article IV. Baldwin, 436 U.S. at 383.
B. The AO’s Limited Area of Consideration Does Not Violate the Equal
Protection Clause.
Pollack claims the AO’s area of consideration in its job announcement violates her right
to equal protection under the Fifth and Fourteenth Amendments of the Constitution. Compl. ¶ 1;
Pl.’s Opp. at 9–10. She asserts that the right to travel is a fundamental right requiring heightened
judicial scrutiny. Id. 8. Defendants acknowledge that the Constitution’s guarantee of equal
protection binds the federal government. Defs.’ Mem. at 16, citing Plyler v. Doe, 457 U.S. 202,
216-18 (1982). See also Shapiro v. Thompson, 394 U.S. 618 (1969) (“[W]hile the Fifth
Amendment contains no equal protection clause, it does forbid discrimination that is so
unjustifiable as to be violative of due process.”) (internal quotation marks and citations omitted).
But defendants assert that only rational basis review is warranted for plaintiff’s claim, and that
under that level of judicial scrutiny, the AO’s area of consideration is valid. Defs.’ Mem. at 17–
18; Defs.’ Reply at 13–15.
The Equal Protection Clause of the Fourteenth Amendment states that, “No State
shall . . . deny to any person within its jurisdiction the equal protection of the laws.” U.S. Const.,
amend. XIV, § 1. In an equal protection challenge, courts apply strict scrutiny when the
challenged classification jeopardizes the exercise of a fundamental right or categorizes
individuals on the basis of an inherently suspect characteristic. Banner v. United States, 428
F.3d 303, 307 (D.C. Cir. 2005). But where a statutory classification neither proceeds along
suspect lines nor infringes fundamental constitutional rights, the provision must be upheld
16
against an equal protection challenge if there is any reasonably conceivable state of facts that
could provide a rational basis for the classification. Hettinga v. United States, 677 F.3d 471, 478
(D.C. Cir. 2012).
Here, Pollack contends that strict scrutiny must be applied not because the AO relied on a
suspect class in its job announcement, but because it violated a fundamental right. Pl.’s Opp. at
12. Although plaintiff is correct that the Supreme Court has applied strict scrutiny in analyzing
other right to travel cases, see, e.g., Shapiro, 394 U.S. 618, Mem’l Hosp., 415 U.S. 250; Dunn,
405 U.S. 330, the standard applies only when the right to travel has actually been implicated.
Plaintiff has not established the necessary predicate.
The Supreme Court has held that a state law implicates the right to travel when it actually
deters travel, when impeding travel is its primary objective, or when it uses any classification
that serves to penalize the exercise of that right. Attorney Gen. of N.Y. v. Soto-Lopez, 476 U.S.
898, 903 (1986). The AO’s geographic limitation in its job announcement does not actually
deter travel. It does not impede or hinder anyone from making the trip to Washington; nor does
it discourage visitors or new residents by suggesting that they would be unwelcome or subject to
onerous requirements when they got here. Further, the limitation’s primary objective is not to
impede travel but to reduce administrative costs in reviewing applications. Reid Decl. ¶ 5.
Finally, the AO’s classification between residents of the Washington, D.C. area and non-
residents of the area does not penalize Pollack for traveling. She is free to travel through, visit,
or move to the Washington, D.C. area, and the job announcement did not apply different criteria
to, or impose additional burdens on, new residents. Accordingly, the AO’s geographic limitation
in its job announcement does not implicate the fundamental right to travel.
17
Pollack argues that the AO’s limitation burdens her ability to become a D.C. resident
based on her current state of residence. Pl.’s Opp. at 10, n.12. She cites Saenz v. Roe for the
proposition that an individual’s prior state of residence has no relevance to a state’s ability to
burden that individual’s right to travel. Id. But Pollack’s argument takes the right to travel
considered in Saenz a step further than the Supreme Court recognized. There, the Court struck
down a California statute that limited the welfare benefits of California residents who had lived
in the state for less than a year to the welfare benefit amounts paid by the state of the plaintiffs’
prior residency. Saenz, 526 U.S. at 493, 498. The Court ruled that this violated the Equal
Protection Clause and the constitutional right to travel because it discriminated against newly-
arrived residents in favor of residents living in the state for more than one year. Id. at 504–505.
Thus, once a newly-arrived resident established bona fide residency in California, the state was
obligated to pay that resident the same level of welfare benefits as a resident who had lived in the
state for more than a year. Saenz did not, however, hold that someone who was planning to
move to California was entitled to receive California’s welfare benefits or even to be considered
for California’s welfare benefits. In other words, the state could not penalize someone for
moving to California by treating them differently from those who had not travelled, but
eligibility was still predicated upon residency. It is the lack of a penalty that distinguishes this
situation from the one presented in Saenz.
Here, Pollack argues the AO is deterring her from moving to the Washington, D.C. area
by precluding her from being eligible for consideration for some, but not all, AO jobs located in
the area while she resides in Kentucky. But, again, the AO is not deterring her from moving.
18
Although Pollack may prefer to move to the Washington, D.C. area with a job in hand, nothing
prevents her from moving to the area to try to secure a job, whether at the AO or anywhere else. 2
The Supreme Court has applied strict scrutiny when a state conditions the receipt of
certain government benefits on the duration of the recipient’s residence in the state. See Saenz,
526 U.S. at 492–93, 504 (state law limiting welfare funds for new residents); Mem’l Hosp., 415
U.S. at 252, 261–62 (state law requiring indigents to have resided in county for previous twelve
months before receiving free non-emergency medical care); Dunn, 405 U.S. at 334–35 (one-year
waiting period to vote); Shapiro, 394 U.S. at 629, 634 (state law imposing one-year waiting
period to receive any welfare benefits). But when a government benefit is conditioned on factors
other than duration of residency, rational basis review is the appropriate standard to determine
whether the right to travel has been unconstitutionally burdened. See, e.g., Connelly v. Steel
Valley Sch. Dist., 706 F.3d 209 (3d Cir. 2013) (upholding a Pennsylvania school district’s
decision to give a teacher less than full credit for out-of-state teaching experience in calculating
his salary). As the Third Circuit recently held, the “relevant distinction when evaluating a claim
asserting a violation of the fundamental right to travel is between long-term and short-term
residents, not current residents and prospective residents.” Id. at 215. (emphasis in original).
The Court agrees this is the relevant analysis and holds that the AO’s job announcement does not
distinguish between long-term and short-term residents, so rational basis review applies.
Under rational basis review, a challenged provision will be upheld if “there is any
reasonably conceivable state of facts that could provide a rational basis for the classification.”
FCC v. Beach Commc’ns, Inc., 508 U.S. 307, 313 (1993). The rationale may be “based on
2 Moreover, the AO did not limit every job located in the Washington, D.C. area to
candidates in the metropolitan area. Pollack applied for and was qualified for three other
attorney positions within the AO, and her applications were referred to the selecting official.
Reid Decl. ¶ 8.
19
rational speculation unsupported by evidence or empirical data” and “the burden is on the one
attacking [the action] to negative every conceivable basis which might support it . . . whether or
not the basis has a foundation in the record.” Heller v. Doe ex rel. Doe, 509 U.S. 312, 320–21
(1993) (internal quotation marks and citations omitted). Here, the AO could rationally
distinguish between individuals who live in the Washington, D.C. area and those who live
outside it as a means to limit the applicant pool for some, but not all, AO jobs. The AO had a
rational interest in reducing its administrative costs by limiting the volume of applications it
received for some vacancies.
Pollack does not dispute that reducing the financial burden associated with a larger
applicant pool is a legitimate state purpose. Rather, she argues that using the geographic
limitation is not sufficiently tied to that purpose. Pl.’s Opp. at 13–14. She contends that a single
application from Kentucky places no greater burden on the AO than does an additional
application from Virginia, Maryland, or the District of Columbia. Id. at 14. But this argument
suggests that a nationwide applicant pool would result in only a single additional application –
hers – when, in fact, it would open the pool to multiple applications from individuals in 48 other
states. She also argues that a nationwide applicant pool is not a financial burden on the AO
because the AO does not pay for an applicant’s travel or moving expenses. Id. But that
observation has nothing to do with the AO’s stated justification. It used the geographic
limitation as a means to reduce the total number of applications it would be required to review
and process, and that is a rational basis for the restriction even if other possible bases were
20
absent. Accordingly, the Court rules that the AO’s geographic limitation has a rational basis tied
to a legitimate purpose and, therefore, does not violate the Equal Protection clause. 3
CONCLUSION
For the reasons set forth above, the Court will grant defendants’ motion for summary
judgment. A separate order will issue.
AMY BERMAN JACKSON
United States District Judge
DATE: August 6, 2013
3 Plaintiff also invokes all clauses of the Fourteenth Amendment, including the Citizenship
Clause, Pl.’s Opp. at 9 n.9, but she only states that the Citizenship Clause “has . . . been
recognized as relevant by Saenz v. Roe,” without explaining how. Id. at 17. Saenz held that the
Citizenship Clause expressly equates citizenship with residence, and that it does not allow for
degrees of citizenship based on length of residence. Saenz, 526 U.S. at 506. But the AO’s
geographic limitation does not distinguish among applicants based on how long they have
resided in the Washington, D.C. area. Accordingly, Pollack’s reference to the Citizenship Clause
and the Saenz case do not support the conclusion that the AO’s actions violate that clause of the
Constitution either.
21
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} |
923 N.E.2d 276 (2010)
236 Ill.2d 103
The PEOPLE of the State of Illinois, Appellee,
v.
Ramesh K. SWAMYNATHAN, Appellant.
No. 107441.
Supreme Court of Illinois.
January 22, 2010.
*278 Michael J. Pelletier, State Appellate Defender, Thomas A. Lilien, Deputy Defender, and Barbara R. Paschen, Assistant Appellate Defender, Office of the State Appellate Defender, Elgin, for appellant.
Lisa Madigan, Attorney General, Springfield, and Michael J. Waller, State's Attorney, Waukegan (Michael A. Scodro, Solicitor General, and Michael M. Glick and Drew Meyer, Assistant Attorneys General, Chicago, of counsel), for the People.
OPINION
Chief Justice FITZGERALD delivered the judgment of the court, with opinion.
Defendant, Ramesh K. Swamynathan, entered a plea of guilty but mentally ill to one count of first degree murder and was sentenced to 20 years in prison. Nearly two years later, defendant filed a pro se motion to withdraw his guilty plea and vacate his sentence, asserting that he was unfit to enter the guilty plea, rendering his plea involuntary. The circuit court of Lake County recharacterized defendant's motion as a postconviction petition and summarily dismissed the petition as patently without merit. Defendant appealed, asserting that the trial court summarily dismissed his petition more than 90 days after the day it was docketed, in violation of the provisions of the Post-Conviction Hearing Act (Act) (725 ILCS 5/122-1 et seq. (West 2006)). The appellate court affirmed. 385 Ill.App.3d 434, 324 Ill.Dec. 174, 895 N.E.2d 669. We granted defendant leave to appeal (210 Ill. 2d R. 315), and for the reasons that follow, we affirm.
BACKGROUND
Defendant was charged with first degree murder after he confessed to stabbing the victim, Ramaro Chittiprolu, 85 times with a knife and vegetable peeler. After stabbing the victim, defendant called 911 and reported the crime. He confessed to police *279 who arrived at the scene of the murder, and confessed again during a formal interrogation. At defendant's first court appearance to set bond, the State requested a fitness evaluation based on reports from the sheriff's department that defendant appeared to be mentally impaired and suicidal. The trial court ordered a fitness evaluation and defendant was subsequently found unfit to stand trial and placed in the custody of the Illinois Department of Mental Health (Department). Some 10 months later, the Department determined that defendant was fit with medication.
The trial court entered a finding of fitness, and also ordered that an interpreter be provided for defendant for all court proceedings pursuant to the Department's assessment of defendant's language skills. The record shows that defendant is a native of India and speaks Tamil, an Indian dialect. Despite this order, many of the proceedings, including the motion to suppress, proceeded without an interpreter, due to the scarcity of Tamil-speaking interpreters. Several discussions concerning defendant's language issues were had on the record, and defendant repeatedly indicated that he could follow the proceedings to some extent in English, but did not understand everything that was being said.
On April 29, 2004, with the aid of an interpreter, defendant entered a plea of guilty but mentally ill. The sentencing hearing commenced on May 27, 2004, and defendant was sentenced to 20 years in prison. He did not file a direct appeal. Nearly two years later, on April 10, 2006, defendant filed a motion to withdraw his guilty plea and vacate his sentence. The motion was placed on the call of a different judge from the judge who originally presided over defendant's case, and the matter was continued twice for ministerial reasons. On May 23, 2006, the trial court and the State discussed defendant's motion on the record, although defendant was not present. The State advised the trial court that defendant's motion was untimely in its current form, but could be recharacterized as a postconviction petition. The State added that if the petition were recharacterized, the State could not have input at the first stage of postconviction review. It was noted that the petition was filed on April 10, 2006, and the court commented that, if the petition were recharacterized, the court would have "90 days to try to resolve it then."
On June 26, 2006, after two continuances, the State advised the court that "last time the Court was considering, but had not declared whether it was going to interpret the defendant's motion as some recognizable form of post-trial relief or not." The trial court stated, "I haven't declared it yet, but I am aware of the fact that in this matter the 90-day period is up on July 13." The matter was then continued until July 10, 2006, at which time the court stated that it was inclined to recharacterize defendant's motion as a postconviction petition, but needed to first "look into a couple of cases that have come down from the Second District [of the appellate court]."
On July 13, 2006, the trial court noted that it had reviewed defendant's motion and the case law, and concluded that defendant's motion to withdraw his plea was untimely. The court stated that it intended to recharacterize defendant's motion as a postconviction petition, but explained,
"[A]dhering to * * * People v. Shelstrom [sic], 216 Ill.2d 45, [295 Ill.Dec. 657], 833 N.E.2d 863, I believe that * * * before we can actually enter an order recharacterizing the petition which would start the other 90-day period we have to bring the defendant back and advise him pursuant to the Shelstrom [sic] case. * * * If the Court *280 fails to do so, the pleading cannot be considered to become a post-conviction petition for purposes of applying to later pleadings * * *. So I think that's what we need to do is to have the defendant brought back, advise him as to what his options are and if he wants to amend it and then after we have done that enter such an order at which time the 90-day period would commence."
The matter was continued for defendant to appear.
On July 27, 2006, defendant was present in court but did not have the aid of an interpreter. The trial court asked defendant if he could understand English, and defendant responded, "A little bit. I do not know fluent English, but I understand." The trial court then explained that defendant's motion was untimely, but that the court was offering defendant an opportunity to agree to recharacterization. Defendant was asked if he agreed to recharacterization, and he stated, "Yes. That is a good thing, right?" The trial court advised defendant that the motion would be recharacterized as a postconviction petition, that it would be considered over a 90-day period, and that defendant would not be entitled to an attorney during that time. Defendant responded by asking "[s]o when can I get [an attorney]?" and then asked whether he was "eligible for a state's attorney." It was explained that defendant was not eligible for an appointed attorney at this stage, but that he could hire his own attorney. The matter was then continued for status, and defendant was advised that it was unnecessary for him to appear in court on the next scheduled date. The record does not specifically explain why defendant was not fully admonished at this time.
The matter was called for status on September 7 and October 5, and then continued to obtain the court file until October 11, 2006. There is no record of proceedings for October 11 in the record, but the record demonstrates that on October 17, 2006, the State advised the court that defendant needed to be admonished, and an order was entered arranging for defendant's presence in court.
On November 2, 2006, defendant was present in court and an interpreter was made available by telephone. With the aid of the interpreter, defendant was advised that his motion was going to be recharacterized as a postconviction petition and was admonished pursuant to People v. Shellstrom, 216 Ill.2d 45, 57, 295 Ill.Dec. 657, 833 N.E.2d 863 (2005). Defendant was then asked if he wanted to amend his pleading. Defendant indicated that he did not want to amend the pleading, but asserted that he wanted an evidentiary hearing. Defendant was advised that his petition would have to survive summary dismissal to become eligible for an evidentiary hearing. After the telephone conversation with the interpreter ended, the postconviction review process was explained to defendant again, but without the benefit of the interpreter. Defendant demonstrated his understanding of the process by repeating the explanation to the court, and was advised, "We're starting another 90 days and if you decide you want to file anything, do so as soon as possible." The matter was continued for 30 days and was then continued to January 5, 2007. There is no record of the January 5, 2007, proceeding. On January 26, 2007, the trial court entered a written order summarily dismissing defendant's postconviction petition as patently without merit.
Defendant filed a motion in the appellate court for summary remand, asserting that the trial court erred in failing to summarily dismiss his petition within 90 days of docketing as required under section 122-2.1(a)(2) *281 of the Act (725 ILCS 5/122-2.1(a)(2) (West 2006)). Defendant also appealed the summary dismissal of his postconviction petition on the merits. The appellate court took the motion for summary remand with the case and rejected defendant's assertion. The appellate court concluded that under Shellstrom, defendant's pleading was not considered a postconviction petition, subject to the guidelines of the Act, until defendant was fully admonished of the consequences of recharacterization. Because defendant did not receive full admonishments until the November 2, 2006, hearing, the trial court's dismissal of defendant's petition on January 26, 2007, was within 90 days and was timely. The appellate court then considered defendant's postconviction claim on the merits and affirmed the trial court's judgment. 385 Ill.App.3d 434, 324 Ill.Dec. 174, 895 N.E.2d 669. We granted defendant's petition for leave to appeal.
ANALYSIS
Defendant asserts that the trial court violated the Act when it ignored the plain language of the statute and summarily dismissed his postconviction petition more than 90 days after recharacterization. Defendant maintains that the trial court made its decision to recharacterize his petition on July 27, 2006, when he was present in court. Defendant points out that he agreed to recharacterization and was told the summary dismissal period would begin on that date, but the trial court nevertheless improperly prolonged the summary dismissal period by giving defendant the required Shellstrom admonishments in a piecemeal fashion, and did not dismiss the petition until January 26, 2007, 183 days from the date of recharacterization. Defendant acknowledges that the trial court was required to admonish him under Shellstrom, but maintains that the Shellstrom requirement does not restrict the trial court's ability to review the filed document within the time frame designated by the Act, nor does it give the court the authority to evade the requirements of the Act. See 725 ILCS 5/122-2.1(a) (West 2006) ("Within 90 days after the filing and docketing of each petition, the court shall examine such petition and enter an order thereon pursuant to this Section").
The State counters that the trial court was not bound by the 90-day requirement of the Act until defendant's petition was properly recharacterized as a postconviction petition, and further argues that recharacterization did not take place until defendant was fully admonished under Shellstrom. Accordingly, the trial court's summary dismissal of defendant's postconviction petition was properly executed within the 90-day period. We agree with the State.
The parties do not dispute that the trial court acted properly when it decided to recharacterize defendant's untimely motion to withdraw his guilty plea and vacate his sentence as a postconviction petition. This court has long held that a trial court may treat a pro se pleading which alleges a deprivation of constitutional rights cognizable under the Act as a postconviction petition. People ex rel. Palmer v. Twomey, 53 Ill.2d 479, 484, 292 N.E.2d 379 (1973); Shellstrom, 216 Ill.2d at 53, 295 Ill.Dec. 657, 833 N.E.2d 863. As we acknowledged in Shellstrom, there are compelling reasons for allowing recharacterization. "First, recharacterization enables the issues to be properly framed. * * * Second, recharacterization avoids the possible harshness of holding a pro se litigant to the letter of whatever label he happens to affix to his pleading, even when his claims are such that they could more appropriately be dealt with under a different heading. * * * A third reason * * * [is *282 that] defendant [is] provided with appellate counsel to assist him in appealing the dismissal [of a postconviction petition]." Shellstrom, 216 Ill.2d at 51-52, 295 Ill.Dec. 657, 833 N.E.2d 863; see also People v. Pearson, 216 Ill.2d 58, 67, 295 Ill.Dec. 621, 833 N.E.2d 827 (2005).
A trial court is not required to recharacterize a pro se pleading as a postconviction petition, even if the claims raised are cognizable under the Act, although this court has encouraged trial courts to do so when appropriate. Shellstrom, 216 Ill.2d at 57, 295 Ill.Dec. 657, 833 N.E.2d 863 ("[W]e recognize that trial courts need not recharacterize a pro se pleading as a postconviction petition. However, we urge judges to consider recasting pleadings that warrant such treatment"). If a trial court determines that recharacterization is appropriate, the court must take certain steps to insure that the defendant is admonished of the consequences of recharacterization. Shellstrom, 216 Ill.2d at 57, 295 Ill.Dec. 657, 833 N.E.2d 863. The court is required to "(1) notify the pro se litigant that the court intends to recharacterize the pleading, (2) warn the litigant that this recharacterization means that any subsequent postconviction petition will be subject to the restrictions on successive postconviction petitions, and (3) provide the litigant an opportunity to withdraw the pleading or to amend it so that it contains all the claims appropriate to a postconviction petition that the litigant believes he or she has." Shellstrom, 216 Ill.2d at 57, 295 Ill.Dec. 657, 833 N.E.2d 863; Pearson, 216 Ill.2d at 68, 295 Ill.Dec. 621, 833 N.E.2d 827. Significantly, if the court fails to give these admonishments, "the pleading cannot be considered to have become a postconviction petition for purposes of applying to later pleadings the Act's restrictions on successive postconviction petitions." Shellstrom, 216 Ill.2d at 57, 295 Ill.Dec. 657, 833 N.E.2d 863.
When a pleading has been recharacterized under Shellstrom as a postconviction petition, the familiar principles of postconviction review apply. A postconviction proceeding is a collateral attack on a prior conviction that permits defendants to challenge their convictions or sentences based on a substantial violation of their rights under the federal or state constitutions. People v. Beaman, 229 Ill.2d 56, 71, 321 Ill.Dec. 778, 890 N.E.2d 500 (2008). Postconviction claims are limited to constitutional matters that were not and could not have been previously adjudicated. People v. Johnson, 206 Ill.2d 348, 356, 276 Ill.Dec. 399, 794 N.E.2d 294 (2002). The Act provides for a three-stage proceeding in all cases that do not involve the death penalty. People v. Harris, 224 Ill.2d 115, 125, 308 Ill.Dec. 757, 862 N.E.2d 960 (2007). At the first stage, the trial court must independently determine, within 90 days of its filing, whether the petition is frivolous or patently without merit. People v. Gaultney, 174 Ill.2d 410, 418, 221 Ill.Dec. 195, 675 N.E.2d 102 (1996); 725 ILCS 5/122-2.1(a)(2) (West 2006). The 90-day time requirement is mandatory and a trial court's noncompliance with the time requirement renders a summary dismissal order void. People v. Brooks, 221 Ill.2d 381, 389, 303 Ill.Dec. 161, 851 N.E.2d 59 (2006). We review the first-stage dismissal of a postconviction petition de novo. People v. Williams, 209 Ill.2d 227, 234, 282 Ill.Dec. 824, 807 N.E.2d 448 (2004).
In this case, defendant asks us to determine when the 90-day summary dismissal period provided in the Act begins to run in the context of recharacterization under Shellstrom. Although that issue was not specifically addressed in Shellstrom, the opinion does provide guidance in answering the question presented. As *283 previously noted, in Shellstrom we explicitly stated that a pleading does not become a postconviction petition until the defendant is given the Shellstrom admonishments. Shellstrom, 216 Ill.2d at 57, 295 Ill.Dec. 657, 833 N.E.2d 863. It would follow, then, that the Act's 90-day rule could not apply to a recharacterized petition until the defendant was fully admonished under Shellstrom and recharacterization was fully completed.
Defendant maintains that this disposition of the issue ignores the plain language of the Act, which specifically states that a postconviction petition must be summarily dismissed within 90 days of docketing. In support, defendant cites to several cases which hold that the 90-day rule in the Act is mandatory, not discretionary, and that the failure to summarily dismiss a petition within 90 days requires appointment of counsel and second-stage review of the petition. See People v. Harris, 224 Ill.2d 115, 308 Ill.Dec. 757, 862 N.E.2d 960 (2007) (holding that the Act requires the trial court to examine a postconviction petition within 90 days even if a direct appeal is pending on the same case); People v. Porter, 122 Ill.2d 64, 86, 118 Ill.Dec. 465, 521 N.E.2d 1158 (1988) (holding that the statutorily allotted time frame for summary dismissal of a postconviction petition is mandatory and noncompliance renders the dismissal order void); Gibson v. People, 377 Ill.App.3d 748, 751, 316 Ill.Dec. 671, 879 N.E.2d 1059 (2007) (holding that the defendant's motion for substitution of judge did not toll the mandatory 90-day summary dismissal period); People v. Redmond, 328 Ill.App.3d 373, 377, 263 Ill.Dec. 112, 767 N.E.2d 838 (2002) (holding that failure to comply with the provisions of section 122-2.1 of the Act render a summary dismissal order void); People v. Vasquez, 307 Ill.App.3d 670, 672, 240 Ill.Dec. 875, 718 N.E.2d 356 (1999) (holding that trial court's summary dismissal order, entered after the matter was remanded for the trial court's failure to substantively review defendant's postconviction claims, was void, as it occurred more than 90 days after the docketing of the petition); People v. Dauer, 293 Ill.App.3d 329, 331, 227 Ill. Dec. 706, 687 N.E.2d 1188 (1997) (holding that trial court erred in summarily dismissing defendant's postconviction petition more than 90 days after docketing, even where court held the petition in abeyance pending the outcome of direct appeal). We do not disagree with defendant's reading of the Act or his interpretation of the cases cited. However, the authority defendant provides does not address the issue before us, nor does it negate the fact that the provisions of the Act cannot apply to pleadings that are not postconviction petitions until those pleadings are properly recharacterized as such.
Defendant further maintains that this disposition creates an unjust result and gives trial courts the freedom to expand the summary dismissal period at will to the detriment of criminal defendants. According to defendant, such an expansion of the summary dismissal period is contrary to the spirit and purpose of the Act, which provides for the expeditious resolution of postconviction claims. Additionally, defendant argues that there is no legitimate reason to allow for an expansion of the 90-day period, as a trial court can assess the merits of a pleading within 90 days regardless of whether the defendant has been fully admonished under Shellstrom. Moreover, defendant maintains that, in this case, the trial court improperly prolonged the summary dismissal period for no good reason and, during the process, placed defendant's case on the call 14 times and required defendant to be brought to court two times, unnecessarily wasting time and resources. The State counters that requiring the trial court to *284 make a decision on summary dismissal within 90 days of determining that recharacterization is appropriate, even if the defendant was not fully admonished, would result in a waste of time and judicial resources, as the trial court would be reviewing a petition without the benefit of amendments the defendant may ultimately choose to make.
We agree with the State that any review of a recharacterized petition prior to full Shellstrom admonishments would be futile, as it would require the review of claims that are likely to be altered. Nevertheless, we acknowledge that the trial court in this case took an inordinate amount of time to complete the Shellstrom admonishments, and the reasons for the delay are not entirely clear from the record. However, the record does provide some insight, showing that the trial court was unsure of the ramifications of Shellstrom, as it was recently decided; that the trial court believed there were cases pending in the appellate court that would provide direction for the handling of the instant case; and that defendant's ability to speak English was limited, as was the trial court's ability to provide an interpreter who could communicate with defendant in his native language. While these factors do not explain every delay that occurred, and there is little doubt that the trial court could have handled this matter in a more expeditious manner, the record nevertheless demonstrates that the trial court had legitimate reasons for prolonging the recharacterization process.
Moreover, the trial court's handling of the recharacterization process in this case cannot be said to have prejudiced defendant in any way. The fact remains that the trial court is under no obligation to recharacterize a petition that could otherwise be disposed of on procedural grounds. The court's decision to recharacterize defendant's petition was beneficial to defendant, regardless of the length of the recharacterization process, because defendant was afforded a substantive review of his claims and the ability to appeal the trial court's judgment with the assistance of counsel. Accordingly, we conclude that the record in this case demonstrates that defendant was properly admonished under Shellstrom, that his pro se pleading was properly recharacterized, and that his recharacterized postconviction petition was properly dismissed within 90 days of docketing as required by the Act. 725 ILCS 5/122-2.1 (West 2006). We find no error.
Defendant nevertheless urges us to utilize our supervisory authority to create a time limit for admonishing defendants under Shellstrom in the event of recharacterization. We decline this request, as we trust in a trial court's ability to properly utilize its inherent authority to control its own docket and the proceedings before it (People ex rel. Daley v. Fitzgerald, 123 Ill.2d 175, 179-83, 121 Ill.Dec. 937, 526 N.E.2d 131 (1988)), particularly in cases where the trial court affords the defendant the opportunity for review of an otherwise procedurally defaulted pleading.
CONCLUSION
For these reasons, we affirm the judgment of the appellate court, which affirmed the summary dismissal of defendant's postconviction petition.
Affirmed.
Justices FREEMAN, THOMAS, KILBRIDE, GARMAN, KARMEIER, and BURKE concurred in the judgment and opinion.
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