Datasets:

parameterlab
/

scaling_mia_the_pile_00_FreeLaw

Dataset card Data Studio Files Files and versions Community

Split (3)

train · 169k rows

text stringlengths 1 1.21M	meta dict
679 F.2d 252 Peachtree Mgt.v.Pioneer Ins. Co. 81-8037 UNITED STATES COURT OF APPEALS Eleventh Circuit 6/3/82 1 N.D.Ga. AFFIRMED 2 --------------- Fed.R.App. P. 34(a); 11th Cir. R. 23.	{ "pile_set_name": "FreeLaw" }
RECOMMENDED FOR FULL-TEXT PUBLICATION Pursuant to Sixth Circuit I.O.P. 32.1(b) File Name: 12a0415p.06 UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT _________________ X - KEITH J. MITAN, as Personal Representative - of Estate of Frank J. Mitan, Plaintiff-Appellant, - - No. 12-1169 , > - v. - - FEDERAL HOME LOAN MORTGAGE - CORPORATION, Defendant-Appellee. N Appeal from the United States District Court for the Eastern District of Michigan at Detroit. No. 2:10-cv-13286—Bernard A. Friedman, District Judge. Decided and Filed: December 12, 2012* Before: MERRITT, MARTIN, and GILMAN, Circuit Judges. _________________ COUNSEL ON BRIEF: Jeffrey T. Goudie, ORLANS ASSOCIATES, P.C., Troy, Michigan, for Appellee. Keith J. Mitan, West Bloomfield, Michigan, pro se. _________________ OPINION _________________ BOYCE F. MARTIN, JR., Circuit Judge. Keith Mitan, a Michigan resident proceeding pro se, appeals the district court’s dismissal of his civil complaint and grant of summary judgment to the defendant-appellee. For the reasons discussed below, the district court’s judgment is reversed and the case remanded. * This decision was originally issued as an “unpublished decision” filed on December 12, 2012. The court has now designated the opinion as one recommended for full-text publication. 1 No. 12-1169 Mitan v. Fed. Home Loan Page 2 Wells Fargo Home Mortgage foreclosed by advertisement the home of Frank J. Mitan. Frank is deceased and Keith Mitan is the personal representative of his estate. Federal Home Loan Mortgage Corporation purchased the foreclosed home at a sheriff’s sale on February 2, 2010, and the redemption period expired six months later. Two weeks prior to that expiration, Mitan filed a complaint in a Michigan state court, naming Freddie Mac as the defendant, and Freddie Mac removed the proceedings to the United States District Court for the Eastern District of Michigan pursuant to 12 U.S.C. § 1452(f). In his complaint, Mitan alleged that the foreclosure by advertisement was contrary to Michigan law, and he sought a jury trial, monetary damages, to quiet the property’s title, and fees and costs. Freddie Mac moved for summary judgment in response. The magistrate judge issued a report and recommendation finding that Freddie Mac’s motion should be granted because Mitan did not have standing to sue, as his interest and title in the property were extinguished at the end of the redemption period. The district court initially adopted the report under the mistaken belief that Mitan had not filed any objections. Mitan then filed a motion under Federal Rule of Civil Procedure 60 for relief from the judgment, reconsideration, or rehearing. The district court concluded that Mitan timely filed his objections, but that the complaint was still meritless for the reasons set out in the report; accordingly, the court denied Mitan’s motion and granted Freddie Mac’s motion for summary judgment. On appeal, Mitan argues that: (1) the district court erred in failing to review de novo the portions of the report that Mitan objected to; and (2) he has standing to sue. We review de novo a ruling on a motion for summary judgment, viewing the facts and reasonable inferences drawn therefrom in the nonmovant’s favor. Dowling v. Cleveland Clinic Found., 593 F.3d 472, 476 (6th Cir. 2010). Summary judgment is appropriate where “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); see also Jones v. Muskegon Cnty., 625 F.3d 935, 940 (6th Cir. 2010). No. 12-1169 Mitan v. Fed. Home Loan Page 3 After foreclosure of a residential mortgage in Michigan, the former owner generally has a redemption period in which to redeem the property by paying the applicable amount, and the filing of a lawsuit during the redemption period does not toll the expiration of that period. See, e.g., Overton v. Mortg. Elec. Registration Sys., No. 284950, 2009 WL 1507342, at 1 (Mich. Ct. App. May 28, 2009) (unpubl.). After the expiration of that period, the former owner’s rights are terminated. Piotrowski v. State Land Office Bd., 4 N.W.2d 514, 517 (Mich. 1942); Mission of Love v. Evangelist Hutchinson Ministries, No. 266219, 2007 WL 1094424, at 4-5 (Mich. Ct. App. Apr. 12, 2007) (unpubl.). Mitan does not contest that he filed suit two weeks before the expiration of the redemption period, or that his suit did not extend the deadline. Instead, he argues the property at issue was foreclosed without statutory authority and thus that the foreclosure was void ab initio. See, e.g., Davenport v. HSBC Bank USA, 739 N.W.2d 383, 385 (Mich. Ct. App. 2007). To assess Mitan’s argument, it is necessary to explain in some detail Michigan’s statutory scheme for loan modification, which limits the circumstances in which a lender may foreclose by advertisement. The law came into effect in 2009 and applies to the mortgage at issue here.1 When a lender wishes to foreclose by advertisement on a borrower’s principal residence, it must provide the borrower with a notice designating a person whom the borrower may contact to negotiate a loan modification. Mich. Comp. Laws § 600.3205a(1). If the borrower requests negotiation within the prescribed time period, the lender’s designated person may request from the borrower certain documents. Id. § 600.3205b(2). If negotiations fail, the designated person is still required to apply statutory calculations to determine whether the borrower qualifies for a loan modification. Id. § 600.3205c(1). If the borrower qualifies, the lender may not foreclose by advertisement unless the designated person offers the borrower a loan-modification agreement that the borrower fails to return within fourteen days of receipt. Id. §§ 600.3205c(6)-(7). When the lender does not adhere to these provisions, the law 1 All statutory citations below refer to the version of the law in effect on February 2, 2010, the date of the foreclosure sale. There have been some amendments to the law since that date, none of which affects our analysis. No. 12-1169 Mitan v. Fed. Home Loan Page 4 provides the borrower a cause of action to convert the foreclosure by advertisement to a judicial foreclosure. Id. § 600.3205c(8). The law also affirmatively prohibits foreclosure by advertisement in certain circumstances. These include situations where the designated person has not negotiated with the borrower as requested, where the parties have independently agreed to a loan modification, and where the statutory calculations show that the borrower qualifies for a loan modification. Id. §§ 600.3204(4)(d)-(f). The facts of Mitan’s case as applied to these statutory requirements are in some dispute. On August 6, 2009, Wells Fargo, via its law firm, sent Frank the required notice naming the law firm as the designated contact person. Frank responded to the law firm in a timely fashion and requested negotiation. The law firm requested documents from Frank. From here, the factual record becomes muddled. Frank apparently never returned the documents to the law firm. Instead, he wrote the law firm stating that he returned the documents directly to Wells Fargo at Wells Fargo’s request. Frank later wrote the law firm stating that Wells Fargo had pre-approved him for a loan modification. However, there is a letter in the record from Wells Fargo stating that it would not adjust the terms of the mortgage because Frank had not provided enough information. The district court might have noted these facts had it performed a proper de novo review of Mitan’s objections to the magistrate judge’s report and recommendation, as required by 28 U.S.C. § 636(b)(1). Instead, before becoming aware that Mitan had objected, the district court judge filed a one-paragraph order accepting the magistrate judge’s report. Realizing his error, the judge issued a new order stating he had “reviewed plaintiff’s objections” but noting only summarily that Mitan had no standing to sue once the redemption period expired. This order does not contain an explanation of the district court’s reasons or otherwise evidence de novo consideration of Mitan’s objections. Plenary review would have shown that the question of standing under Michigan law is more complicated than the magistrate judge believed. No. 12-1169 Mitan v. Fed. Home Loan Page 5 As a general rule, Michigan law does not permit property owners to make claims related to foreclosed property after expiration of the redemption period. See Piotrowski, 4 N.W.2d at 517; Overton, 2009 WL 1507342, at *1. Mitan claims that this rule is not applicable here. Because the foreclosure by advertisement violated Mich. Comp. Laws § 600.3204(4)(f), he argues, it was void and the redemption period never began. We agree with Mitan’s interpretation of the law. Michigan law distinguishes between foreclosures with notice defects and those with “structural defect[s] that go[] to the very heart of defendant’s ability to foreclose by advertisement in the first instance.” Davenport, 739 N.W.2d at 384. Notice defects render a foreclosure voidable. Jackson Inv. Corp. v. Pittsfield Prods., Inc., 413 N.W.2d 99,101 (Mich. Ct. App. 1987). Structural defects, on the other hand, render the foreclosure absolutely void. Davenport, 739 N.W.2d at 385. In Davenport, for instance, the defendant bank had no statutory authority to foreclose because it did not own an interest in the mortgage when it published its first notice of foreclosure, as required by Mich. Comp. Laws § 600.3204(1)(d). Similarly, Mich. Comp. Laws § 600.3204(4) is a statutory prohibition on foreclosure by advertisement where a lender does not take the required steps to negotiate a loan modification. Although one of the required steps is to provide notice, see Mich. Comp. Laws § 600.3204(4)(a), the failure to comply with the loan-modification process as outlined in the statute is a structural defect because it deprives the borrower of the opportunity to demonstrate eligibility for a loan modification that would avoid foreclosure altogether. See id. § 600.3204(4)(f). In contrast, the notice defect at issue in Jackson did not call into question the underlying right of the lender to foreclose once past the procedural defect. See 413 N.W.2d at 101. It follows that, as a matter of Michigan law, a lender that fails to follow the loan- modification procedures set forth by the statute has engendered a structural defect and is thus without authority to commence a foreclosure. Without a valid foreclosure, the redemption period has not begun, and the owner of the property retains an interest conferring standing to sue. No. 12-1169 Mitan v. Fed. Home Loan Page 6 The remaining question is factual. Did Wells Fargo, in this particular case, foreclose on the property in violation of the loan-modification law? On this record, we are unable to tell. Mitan alleges that Frank returned the necessary paperwork to Wells Fargo, that Wells Fargo had approved a loan modification, and that Frank qualified for a loan modification under the statutory calculations. Portions of the record bring these points into dispute. Besides this, it is altogether unclear why Wells Fargo’s designated agent did not have access to communications that Frank may have sent directly to Wells Fargo. It is also unclear whether Wells Fargo or its agent ever attempted to make the calculation required under Mich. Comp. Laws § 600.3205c(1). If further factual development shows that Wells Fargo did not comply with the loan-modification law, then Mitan has standing and may pursue the merits of his claim. In sum, the district court erred when it held that Mitan lacked standing because the redemption period had expired. If Wells Fargo violated the loan-modification law, then the redemption period never began. On remand, the district court should make factual findings to determine whether Wells Fargo assessed Frank’s eligibility for a loan modification as required by statute. The judgment of the district court is reversed, and the case is remanded for further proceedings.	{ "pile_set_name": "FreeLaw" }
UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 15-7955 HENK ORLANDO ROMMY, In the matter of the Extradition of, Plaintiff - Appellant, v. UNITED STATES OF AMERICA, Defendant - Appellee. Appeal from the United States District Court for the Northern District of West Virginia, at Clarksburg. Irene M. Keeley, District Judge. (1:15-cv-00163-IMK-MJA) Submitted: March 17, 2016 Decided: March 22, 2016 Before WILKINSON, NIEMEYER, and KING, Circuit Judges. Dismissed by unpublished per curiam opinion. Brian Joseph Kornbrath, Federal Defender, Clarksburg, West Virginia, for Appellant. Paul Thomas Camilletti, Assistant United States Attorney, Martinsburg, West Virginia, for Appellee. Unpublished opinions are not binding precedent in this circuit. PER CURIAM: Henk Orlando Rommy seeks to appeal the district court’s order denying his appeal of the magistrate judge’s order certifying his extradition pursuant to 18 U.S.C. § 3184 (2012). This court may exercise jurisdiction only over final orders, 28 U.S.C. § 1291 (2012), and certain interlocutory and collateral orders, 28 U.S.C. § 1292 (2012); Fed. R. Civ. P. 54(b); Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541, 545- 46 (1949). The order Rommy seeks to appeal is neither a final order nor an appealable interlocutory or collateral order. See Zhenli Ye Gon v. Holt, 774 F.3d 207, 210-11 (4th Cir. 2014), cert. denied, 135 S. Ct. 2859 (2015). Accordingly, we dismiss the appeal for lack of jurisdiction. We dispense with oral argument because the facts and legal contentions are adequately presented in the materials before this court and argument would not aid the decisional process. DISMISSED 2	{ "pile_set_name": "FreeLaw" }
951 F.2d 367 U.S.v.Torkington* NO. 90-5574 United States Court of Appeals,Eleventh Circuit. Dec 09, 1991 1 Appeal From: S.D.Fla. 2 AFFIRMED. * Fed.R.App.P. 34(a); 11th Cir.R. 34-3	{ "pile_set_name": "FreeLaw" }
61 P.3d 923 (2003) 335 Or. 143 Joseph SCHLIMGEN, Personal Representative for the Estate of Michael F. Schlimgen, deceased, Petitioner on Review, v. MAY TRUCKING COMPANY, an Idaho corporation, Respondent on Review. (CC 9803-02267, CA A107409, SC S49194). Supreme Court of Oregon, En Banc. Argued and submitted November 4, 2002. Decided January 24, 2003. 924 Michael T. Garone, Schwabe, Williamson & Wyatt, P.C., Portland, argued the cause and filed the briefs for petitioner on review. With him on the petition was Karen O'Kasey, Portland. Gordon T. Carey, Jr., Portland, argued the cause and filed the briefs for respondent on review. LEESON, J. In this wrongful death action, defendant contends that the trial court erred by giving a verdict-urging instruction after the presiding juror had informed the court that the jury was deadlocked. The Court of Appeals reversed on the ground that the instruction was coercive. Schlimgen v. May Trucking Co., 178 Or.App. 397, 410, 37 P.3d 1005 (2001). For the reasons that follow, we reverse the decision of the Court of Appeals and remand the case to that court for further consideration. Plaintiff is the personal representative of Michael Schlimgen, who was killed in an accident near an on-ramp to Interstate 5 south of Portland involving a tractor-trailer driven by defendant's employee. After the parties presented their evidence and arguments, the trial court instructed the jury, and the jury retired to deliberate. The presiding juror thereafter told the court that the jury was deadlocked on the question of the respective percentages of Schlimgen's and defendant's fault. The court then gave the following supplemental instruction to the jury: "At this point I want you to be very careful not to say anything that will give any indication of which way your jury is leaning in this divided case. My interest as the trial judge is not in the result that you reach. I told you that as part of the instructions. My interest is in the process that you follow. And of course my interest, as well as your interests and the interests of the parties is to get this case resolved. "I appreciate very much that the trial was burdensome upon you, and that burden has extended long beyond any of uswhat any of us contemplated or wanted. I'd point out that that alone is a reason not to become angry and upset and not proceed to decide the case. In fact, it's just the reverse. That's a real reason for you to put in the last effort and get this case resolved. "Now, if you, on the basis of what you've heard, don't resolve this case, we're going to pick another group of jurors, and we're going to hear this case again. And I would suggest to you that it's doubtful that we're going to find a group of people any more reasonable than you, and it's doubtful that those jurors are going to be presented with any better evidence to decide these issues than you were presented with. And it's going to be very burdensome collectively on everyone to proceed through this again and find ourselves sitting in exactly this situation with 12 jurors who have a very difficult decision to make in order to resolve this. "This is a casea problem that's not going to go away. It's got to be resolved. Now, I'm going to ask you to continue deliberating. I do want you to understand, as I said in the initial instructions, that you should deliberate in the full sense of the word, you should consider the reasoning, the arguments and the opinions of all of the other jurors, and you should be willing to explain to the other jurors the reasoning 925 and arguments that cause you to take the position that you take. "And I urge you to try to fully understand what the other jurors are saying and doing and why they're doing it, and for you to make every effort to try to explain to them why you're taking the position that you are taking, and that you do this with an open mind and for the purpose of attempting to resolve the questions that remain between you. "But now I would caution you that while I've talked about the importance of resolving the case, I also want to remind you of the importance of your individual decision in the case. And while it's your responsibility to deliberate and to be open minded and to continually reevaluate your position, and to in fact change your position if you're persuaded, through the deliberations, that your original position was incorrect and that another position is correct, it would not be appropriate for you to sacrifice your honest opinion as to the weight of the evidence or the ultimate result of the case just to reach a verdict. When you do return with a verdict, the verdict has to be one in which you agree. "Now, I'm going to ask that you return to the jury room, that you deliberate further, that you attempt to resolve this, and we will await to hear from you as to whether you've been successful or not. But I do wish that you speak fully about these instructions and about where you are, not just go in the jury room and turn around and hit the buzzer out of pique, and come back in and say, you know, `We told you before, we can't resolve this.' That won't do any of us any good. "Try to be patient. Now, be cautious not to say anything that's going to let these lawyers have any idea which way your jury is leaning because that's going to make it more difficult for me to proceed with this, if one side or the other perceives the caseperceives themselves to be at a disadvantage, then my difficulties in managing this are going to become much more difficult." The presiding juror responded that the jury had made significant efforts to resolve the case the previous Saturday and that morning. The trial court then stated: "Well, I'm not going to be arbitrary. And yes, you did proceed on Saturday, yes, you're proceeding today. It's now two weeks from the time that we started the trial. Collectively we have I don't know how many months of12we have several months of timeonethe equivalent of one person working several months, just in the trial, let alone all of the preparation that was made. "I've spoken to you. If you go back, and you say, `I listened to what Judge Redding said, and there's no hope, we're not going to settle it,' then I'm not going to jail you. But I'm having this conversation with you because I want you to know that while this is going to be over for you, it is not going to be over for the community. This case will be decided. We will start again. We will pick another jury. We will listen through all of the evidence and the questions, and probably more, because my experience is when cases have to be retried, they do not become less complex. They do not become shorter. They become longer. Everything that was asked before gets asked again, in several different ways. "Weand if you, as you've said, honestly can't decide the case, then we'll get another group ofstart with 30 jurors, we'll winnow through them, we'll excuse some, we'll take others, we'll have alternates. You've been here. Took eight days last time. Going to take that amount of labor and more the next time. "If you tell me that that's what is necessary because of your views, then I'll respect that, and then we will proceed. But it's a very serious decision to make. The decision not to decide is as important as the decision is to decide the case. "I'll wait for you. Please give me the courtesy of talking it over, and I'll wait for what you tell me." Defendant objected to the court's supplemental instruction and moved for a mistrial. The trial court denied defendant's motion. The jury resumed its deliberations, and, later that day, it returned a verdict finding that Schlimgen had been 40 percent at fault and 926 that defendant had been 60 percent at fault in the accident. Defendant filed a motion for a new trial arguing, among other things, that the trial court erred in giving the jury the supplemental instruction quoted above. The trial court denied that motion. On appeal, the Court of Appeals considered whether to apply its supervisory power to prohibit the verdict-urging instruction that the trial court gave in this civil case. Schlimgen, 178 Or.App. at 406, 37 P.3d 1005. The court interpreted this court's decision in State v. Marsh, 260 Or. 416, 490 P.2d 491 (1971), to prohibit certain types of verdict-urging instructions in criminal cases because of the prospect that such instructions might coerce the jury. The Court of Appeals concluded that "the specter of jury coercion is as much a cause for concern in the civil as in the criminal context." Schlimgen, 178 Or.App. at 407, 37 P.3d 1005. Accordingly, it held that "the rule announced in Marsh " prohibiting verdict-urging instructions that are coercive applies "in the civil as well as the criminal context." Id. at 406, 37 P.3d 1005. The Court of Appeals next considered whether the supplemental instruction that the trial court gave was "coercive." Id. at 407, 37 P.3d 1005. In that court's view, to determine whether such an instruction is "coercive" under Marsh, a court should take into account a variety of factors regarding the particular wording of the instruction and the factual setting or context in which the instruction was given. See id. at 408, 37 P.3d 1005 (listing factors). Applying that standard, the Court of Appeals concluded that the supplemental instruction that the trial court gave in this case was "improperly coercive" and remanded the case for a new trial. Id. at 410, 37 P.3d 1005. As we discuss more fully below, we agree with the Court of Appeals that the same rule regarding verdict-urging instructions should apply in civil cases as the one that applies in criminal cases. However, we disagree with the Court of Appeals' reading of Marsh and with its decision to apply the rule in Marsh retrospectively in this civil case. In Marsh, after deliberating for several hours, the jury sent a note to the court, stating: "Our discussion is six guilty, six not guilty." Marsh, 260 Or. at 420, 490 P.2d 491. The trial court then told counsel that it intended to "call the jury in and instruct them," after which "each side [would] be permitted to take whatever exception it [felt] it should." Id. The trial court then gave the jury the following supplemental instruction, without objection: "Members of the jury, it is now not quite 9:00 o'clock. You have been at work since about 4:30 this afternoon, omitting the dinner hour. The note you have sent in a moment ago indicates that your number stands six for one side and six for the other. "It is my duty to urge you to reach a decision on this case. This case has to be tried either now or later. It is unlikely that this case will ever be tried by any jury more competent and more representative of the community than yourselves. It is unlikely that the evidence would be any different before any later trial than it was before this one and so it is important that the matter be resolved. Those of you who stand on one side of the question should give respectful attention and consideration to the views of those opposed. And vice-versa. "None of this, however, should be construed by you as suggesting that I believe that you should not vote any other way than your own conscience based upon the evidence and the instructions in this case. None of us expect you to do anything other than that. But I am sure that you realize along with me that this case should be decided. It ought not to be decided unless it is decided by the appropriate number ten to two and it ought not to be decided unless those ten of you who concur, if you do, each reach your decision honestly base[d] upon the evidence and the law and your own view of the matter; so nothing I say should be taken as meaning that I want any of you to vote other than what your own good judgment dictates. But for the reasons I have mentioned I urge you to go back and to deliberate further and 927 see if you can reach a verdict. You may now be excused to the jury room." Id. The court gave a second supplemental instruction to the same effect later that night. Id. at 421, 490 P.2d 491. Thereafter, the jury returned a guilty verdict. Id. at 422, 490 P.2d 491. The defendant did not move for a mistrial. Before this court, although he had failed to preserve the alleged error, the defendant argued that the trial court's supplemental instructions urging the jury to reach a verdict violated his constitutional rights to a fair trial and due process of law. Id. at 438-39, 490 P.2d 491. This court began by addressing the defendant's constitutional claim. Id. at 437-39, 490 P.2d 491. After analyzing case law from several other jurisdictions and considering, in detail, the factual circumstances of the case, the court concluded that the supplemental instructions at issue did not violate the defendant's constitutional rights. Id. at 439, 490 P.2d 491. The court then considered whether it should announce a prospective rule regarding verdict-urging instructions. Id. at 441-42, 490 P.2d 491.[1] The court identified several advantages and disadvantages of verdict-urging instructions. The court agreed with courts in other jurisdictions that held that trial judges should not be "required immediately to accept a jury's first indication of failure to agree without a fair attempt at encouraging agreement." Id. at 441, 490 P.2d 491. However, the court doubted whether there was "any coherent theory" that would distinguish between appropriate verdict-urging instructions and those that are impermissibly coercive. Id. The court expressed concern that, because of the "endless variations" of such instructions and the factual circumstances in which they are given, a rule permitting verdict-urging instructions would be "difficult, if not impossible, for the courts to uniformly administer * * ." Id. Finally, the court noted that the "need for economy in judicial administration by discouraging hung juries" must be balanced against "the risk that defendants may be convicted as the result of improper coercion" that results from the trial court's use of verdict-urging instructions. Id. at 441-42, 490 P.2d 491. The court concluded that, in general, verdict-urging instructions "involve[] so many `pitfalls' and [are] such an invitation to error as to cause more trouble in the administration of justice than [they are] worth." Id. at 442-43, 490 P.2d 491. Nonetheless, consistent with the court's view that, in some cases, trial judges should be able to encourage juries to reach a verdict, the court expressly approved the use of portions of a verdict-urging instruction that the American Bar Association (ABA) had proposed for those cases in which a trial court, in its discretion, "deem[s] it advisable to give some supplemental instruction to a deadlocked jury." Id. at 443, 490 P.2d 491. The court approved the following instruction: "It is your duty, as jurors, to consult with one another, and to deliberate with a view to reaching an agreement if you can do so without violence to individual judgment. Each of you must decide the case for yourself, but do so only after an impartial consideration of the evidence in the case with your fellow jurors. In the course of your deliberations, do not hesitate to reexamine your own views, and change your opinion, if convinced it is erroneous. But do not surrender your honest conviction as to the weight or effect of evidence solely because of the opinion of your fellow jurors, or for the mere purpose of returning a verdict." Id. at 443 n. 58, 490 P.2d 491.[2] In sum, the rule announced in Marsh is that, in criminal cases, a trial court may, in its discretion, give the verdict-urging instruction just quoted. Marsh also indicated that other verdict-urging instructions are acceptable so long as 928 they do not depart meaningfully from the instruction just quoted. See id. at 444, 490 P.2d 491 (terms of ABA-approved instruction "are not to be regarded as graven in stone" (internal quotation marks omitted)). Although the Marsh court confined its analysis to criminal cases, see id. at 443, 490 P.2d 491 (application in civil context was "question not before this court"), and although the verdict-urging instruction just quoted was adopted with an eye to criminal trials, nothing about the analysis in Marsh or that instruction is specific to criminal cases. The Marsh court identified three main concerns respecting verdict-urging instructions: (1) the risk that such instructions might coerce jurors and result in erroneous verdicts; (2) the possibility that a total ban on such instructions might impede the effective administration of justice; and (3) the absence of a "coherent standard" for evaluating whether a particular verdict-urging instruction is proper. Id. at 441-43, 490 P.2d 491. Those concerns also are relevant in the civil context. Accordingly, we extend the Marsh rule, identified above, to the civil context. We turn to plaintiff's argument that the requirement that we now announce should be applied only prospectively. We agree. This court has been "reluctan[t] to prejudice litigants by applying new * * * trial practice requirements to cases tried before the announcement of [those] requirements." Falk v. Amsberry, 290 Or. 839, 847, 626 P.2d 362 (1981). See also Peterson v. Temple, 323 Or. 322, 918 P.2d 413 (1996) (applying prospectively rule regarding mandatory joinder of claims for personal injury and for property damage arising from particular set of facts). Indeed, the Marsh court applied the rule that it announced in that case only to future criminal cases. 260 Or. at 441, 490 P.2d 491. Our extension of that rule to civil cases makes "new" law, and, for the reasons discussed in Falk and Peterson, it would not be equitable to apply the rule to this case. See Peterson, 323 Or. at 334, 918 P.2d 413 (concluding that "inequitable result [would] occur" if court applied new rule retrospectively). We conclude that the rule that we announce regarding the use of verdict-urging instructions in civil cases should apply prospectively only. It follows that, in this case, the trial court did not commit reversible error by giving a verdict-urging instruction that departed from the instruction that the court in Marsh approved for use in criminal cases. It remains for us to consider whether there is any other principle of law that prohibits the use of the verdict-urging instruction that the trial court gave in this case. Defendant has not identified any constitutional provision, statute, or rule of civil procedure that requires reversal here. As noted, in Marsh, this court held that a verdict-urging instruction did not violate the defendant's constitutional rights. 260 Or. at 438-39, 490 P.2d 491. Defendant does not identify any differences between Marsh and this case, either in the wording of the verdict-urging instructions or in the circumstances surrounding those instructions, that indicate that the court's instruction violated defendant's constitutional rights. The decision of the Court of Appeals is reversed. The case is remanded to the Court of Appeals for further proceedings. NOTES [1] The court noted that a verdict-urging instruction commonly is known either as an "Allen charge," after Allen v. United States, 164 U.S. 492, 501, 17 S.Ct. 154, 41 L.Ed. 528 (1896), or as a "dynamite charge" and is given to encourage deadlocked juries to reach a verdict. Marsh, 260 Or. at 423, 490 P.2d 491. [2] Uniform Criminal Jury Instruction No. 1023 is substantively identical to the instruction that the court approved in Marsh.	{ "pile_set_name": "FreeLaw" }
649 F.2d 866 Amyesv.U. S. Department of Transportation 79-3471 UNITED STATES COURT OF APPEALS Ninth Circuit 4/13/81 1 C.D.Cal. AFFIRMED	{ "pile_set_name": "FreeLaw" }
UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT STANLEY VERNON, Plaintiff-Appellant, v. No. 95-3149 UNITED STATES OF AMERICA, Defendant-Appellee. Appeal from the United States District Court for the District of South Carolina, at Charleston. David C. Norton, District Judge. (CA-95-535-2-18) Argued: September 26, 1996 Decided: March 5, 1997 Before RUSSELL and MICHAEL, Circuit Judges, and MICHAEL, Senior United States District Judge for the Western District of Virginia, sitting by designation. _________________________________________________________________ Affirmed by unpublished per curiam opinion. _________________________________________________________________ COUNSEL ARGUED: Mark Lee Archer, North Charleston, South Carolina, for Appellant. John Harris Douglas, Assistant United States Attorney, Charleston, South Carolina, for Appellee. ON BRIEF: Margaret B. Seymour, United States Attorney, Charleston, South Carolina, for Appellee. _________________________________________________________________ Unpublished opinions are not binding precedent in this circuit. See Local Rule 36(c). _________________________________________________________________ OPINION PER CURIAM: Stanley Vernon ("Vernon") appeals a grant of summary judgment in favor of the United States in his negligence suit against the United States under the Federal Tort Claims Act ("FTCA").1 Vernon argues the court erred because the United States does not qualify as a "statu- tory employer" under the South Carolina Workers' Compensation Law,2 and is not entitled to the "exclusive remedy" defense found in that law. He further contends that because the South Carolina law is purely jurisdictional, it cannot serve as the underlying basis of a fed- eral court's decision. The district court found that the United States is subject to South Carolina law, was Vernon's statutory employer, and was entitled to assert the exclusive remedy defense. We agree, and for the reasons that follow, we affirm the district court's grant of summary judgment. I. Vernon worked for Lockheed Missile and Space Corporation ("Lockheed"), at the Navy's Polaris Missile Facility, Atlantic ("Pomflant"), in Charleston, South Carolina. He held a job as a Sur- face Support Equipment mechanic ("SSE"). SSEs maintained and repaired missile handling equipment. Lockheed employees and United States Navy personnel both performed this job. Lockheed was a contractor of the United States. At Pomflant, Vernon slipped, fell and was injured. He filed a claim against Lockheed, and received and accepted benefits under the South Carolina Workers' Compensation Law. He also sued the United _________________________________________________________________ 1 28 U.S.C. §§ 1346(b), 2401(b), 2671-80 (1994). 2 S.C. Code Ann. tit. 42 (Law. Co-op. 1985 & Supp. 1995). 2 States under the FTCA, charging that the negligence of Navy person- nel caused his injury. The United States moved for summary judgment, claiming it was Vernon's statutory employer, and therefore entitled to assert the exclusive remedy defense under the South Carolina Workers' Com- pensation Law.3 The district court found that the United States was Vernon's statutory employer, it was entitled to the exclusive remedy defense, and granted the United States summary judgment. This appeal followed. II. Vernon raises two issues on appeal. First, he argues that the United States was not his statutory employer, and thus not entitled to the exclusive remedy defense. Second, he argues that the South Carolina Workers' Compensation Law is purely jurisdictional and cannot form the underlying basis for a decision by a federal court. These argu- ments require that we examine the relevant provisions of both the FTCA and the South Carolina Workers' Compensation Law. A. Under certain circumstances, the FTCA allows injured parties to sue the United States for the negligence of its employees. An action may only proceed in the same manner and to the same extent as would an action against a private person under the laws of the state where the incident occurred.4 There is no dispute that South Carolina law applies, and so we turn to an examination of South Carolina law. _________________________________________________________________ 3 Id. § 42-1-540. 4 28 U.S.C. §§ 1346(b) & 2674 (1994); Lockheed Aircraft Corp. v. United States, 460 U.S. 190 (1983); Pendley v. United States, 856 F.2d 699 (4th Cir. 1988). Congress used different, but consistent language in the two sections cited above. In 28 U.S.C. § 1346(b), Congress gave jurisdiction to the district courts . . . on claims against the United States for money damages, . . . personal injury or death caused by the neg- ligent or wrongful act or omission of any employee of the Gov- 3 South Carolina has adopted a comprehensive scheme of workers' compensation.5 The scheme includes an "exclusive remedy" provi- sion, which provides that when an employer pays and an injured employee accepts benefits under the Workers' Compensation Law, the employee gives up all "other rights and remedies . . . as against his employer, at common law or otherwise, on account of [the] injury."6 If the United States was Vernon's employer, as contemplated by the Workers' Compensation Law, then it is entitled to the exclusive rem- edy defense. Under the Workers' Compensation Law, a "statutory employer" is someone who hires a contractor or subcontractor to do his work, if certain conditions are met: When a person, . . . referred to as "owner," undertakes to perform or execute any work which is part of his trade, busi- ness or occupation and contracts with any other person, (. . . referred to as "subcontractor") for the execution or per- formance by or under such subcontractor, . . . the owner shall be liable to pay to any workman employed in the work any compensation under this Title which he would have been liable to pay if the workman had been immediately employed by him.7 _________________________________________________________________ ernment, . . . under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred. In 28 U.S.C. § 2674, Congress established liability for the United States as follows: The United States shall be liable, respecting the provision of this title relating to tort claims, in the same manner and to the same extent as a private individual under like circumstances . . . . We do not believe it is necessary to examine the different language of the two sections for the purposes of this appeal. 5 S.C. Code Ann. tit. 42 (Law. Co-op. 1985 and Supp. 1995). 6 S.C. Code Ann. § 42-1-540. 7 S.C. Code Ann. § 42-1-400. 4 South Carolina courts use a three-part test to determine when a statutory employer-employee relationship exists. The courts ask: (1) Is the activity an important part of the owner's busi- ness; (2) is the activity a necessary, essential, and integral part of the business; and, (3) has the identical activity been performed by the employees of the owner?8 In this case, the district court received an affidavit from Rear Admiral George P. Nanos, Jr., Director of the Strategic Systems Pro- grams. Admiral Nanos supervised work at Pomflant. Based on Admi- ral Nanos' affidavit, the district court found that (1) the work Vernon was performing was an important part of the Navy's business; (2) the work was a necessary, essential, and integral part of the Navy's busi- ness; and (3) Navy personnel were performing identical work. Apply- ing the above test, then, the district court found that the United States was Vernon's statutory employer. In Marchbanks v. Duke Power Co.,9 the South Carolina Supreme Court held that a statutory employer was entitled to the exclusive remedy of the Workers' Compensation Law. That rule has been fol- lowed by state and federal courts in South Carolina ever since.10 The district court found that the United States, as Vernon's statutory employer, was allowed to use the exclusive remedy defense, and cor- rectly granted summary judgment in favor of the United States. _________________________________________________________________ 8 Carter v. Florentine Corp., 423 S.E.2d 112, 113 (S.C. 1992) (citations omitted). 9 2 S.E.2d 825, 836 (S.C. 1939). 10 See, e.g. Corollo v. S.S. Kresge Co., 456 F.2d 306 (4th Cir. 1972) (applying exclusive remedy defense to statutory employer); Wheeler v. Morrison Machinery Co., 438 S.E.2d 264 (S.C. Ct. App. 1993) (same). 5 B. Vernon first argues that the United States cannot use the exclusive remedy defense, because it is not subject to the South Carolina Work- ers' Compensation Law. He is correct in noting that the South Caro- lina Workers' Compensation Law specifically does not apply to employees of the federal government. The law clearly states, "This Title shall not apply to: (1) casual employees, . . . and Federal employees in this State."11 From this point, Vernon proceeds to pro- pose that because federal employees are exempt, and neither Vernon nor the United States followed the statutory procedure to waive that exemption,12 then the law does not apply and the defense is not avail- able to the United States. However, Vernon starts with the wrong premise, and so ends up with the wrong conclusion. The proper starting place is the FTCA, which provides that "[t]he United States shall be liable, respecting the provision of this title relating to tort claims, in the same manner and to the same extent as a private individual under like circumstances . . . ."13 Thus, to find liability under the FTCA, the United States first must be placed in the shoes of a hypothetical private person. In this case, the United States is the statutory employer. It is the "owner" identified in the South Carolina law at section 42-1-400. From there, the analy- sis proceeds under South Carolina law. It is clear from both state and federal cases (applying state law) that a statutory employer in these circumstances is fully entitled to assert the exclusive remedy defense.14 _________________________________________________________________ 11 S.C. Code Ann. § 42-1-360. 12 S.C. Code Ann. § 42-1-380. An exempt employer "may come in under the terms of this Title and receive the benefits and be subject to the liabilities of this Title by filing with the Commission a written notice of his desire to be subject to the terms and provisions of this Title." 13 28 U.S.C. § 2674 (1994) (emphasis added). 14 See, e.g. Corollo, 456 F.2d 306; Wheeler, 438 S.E.2d 264 (applying exclusive remedy defense to statutory employer). 6 C. Second, Vernon contends that because the exclusive remedy defense is purely jurisdictional, it cannot form the substantive basis for a federal court's decision. We disagree. The FTCA states that the United States is liable only when a private person would be liable.15 By specifically adopting state law as the underlying law for a claim under the FTCA, Congress requires each FTCA suit to rest on state law. In this case, a private person under like circumstances would not be liable for Vernon's injuries, so the United States cannot be liable, either. Vernon would have us find the United States liable under cir- cumstances where a private defendant would not face liability. Such a result contradicts the clear language of the FTCA. We decline to adopt Vernon's approach. III. For the foregoing reasons, the judgment below is AFFIRMED. _________________________________________________________________ 15 28 U.S.C. §§ 1346(b) & 2674. 7	{ "pile_set_name": "FreeLaw" }
596 F.2d 330 GENERAL REINSURANCE CORPORATION, Appellee,v.MISSOURI GENERAL INSURANCE COMPANY, Appellee, Jerry B.Buxton, Director, Division of Insurance and Receiver forMissouri General Insurance Company, Appellee, James A.Polsinelli, Commissioner of Claims for Missouri GeneralInsurance Company, Mississippi Insurance GuarantyAssociation, Appellant.Wholesale Materials Company, Inc., Charles F. Jones andHattie K. Keeton. Reinsurance Association ofAmerica, Amicus Curiae. No. 78-1269. United States Court of Appeals,Eighth Circuit. Submitted Sept. 15, 1978.Decided April 17, 1979. Robert M. Sommers (on brief), of James, Odegard & Millert, Kansas City, Mo., argued, for appellant; Neal E. Millert, Kansas City, Mo., and P. N. Harkins, III, of Watkins & Eager, Jackson, Miss., on brief. John C. Craft (argued), and William C. Jolley, Jr., Kansas City, Mo., on brief, for appellee. Charles W. Havens, III, Washington, D. C. (argued), and Franklin W. Nutter, Alexandria, Va., on brief, for amicus curiae, Reinsurance Assn. of America. Before LAY and BRIGHT, Circuit Judges, and HARPER, Senior District Judge.* PER CURIAM. 1 This is an appeal from a final judgment by the trial court ordering that certain proceeds of reinsurance be paid to defendant Receiver for insolvent Missouri General Insurance Company, appellee herein. 2 For the purpose of providing some background, the basic facts of the case are as follows: On January 1, 1971, Agreement of Reinsurance No. 4191 was entered into between General Reinsurance Corporation and Medallion Insurance Company and its subsidiaries, including Missouri General Insurance Company (hereinafter referred to as Missouri General). In 1971, Missouri General issued a comprehensive general liability insurance policy insuring Wholesale Materials Company, Inc. In 1972, Wholesale Materials Company, Inc., was named the defendant in a lawsuit for personal injuries filed in the Circuit Court of Forrest County, Mississippi. Pursuant to the terms of its policy issued to Wholesale Materials Company, Inc., Missouri General undertook the defense of the suit. 3 Thereafter, during the course of the lawsuit, Missouri General became insolvent and a Receiver was appointed. Pursuant to Mississippi law, Mississippi Insurance Guaranty Association (hereinafter referred to as Guaranty Association), upon notice of the appointment of a Receiver for Missouri General, undertook the defense of the Mississippi suit. Subsequently, the Guaranty Association settled the lawsuit for $150,000.00, and paid the sum of $150,000.00 out of its fund. As a result of the Receiver and the Guaranty Association both stating a claim to the reinsurance proceeds under the Agreement of Reinsurance No. 4191, General Reinsurance Corporation instituted this interpleader action, pursuant to Title 28, 1335 U.S.C. The case was submitted to the court below, without a jury, on the pleadings, stipulated facts and trial briefs. 4 In holding that the Receiver of Missouri General was entitled to the reinsurance proceeds, the Court pointed to the plain language of the Reinsurance Agreement as mandating such a result. In the trial court's view, the interpretation of the Reinsurance Agreement entitling the Receiver to the reinsurance proceeds was consistent with both the State of Missouri's statutory scheme for winding up insurance companies and the weight of authority in other jurisdictions. Upon careful consideration of the records, the briefs and arguments of the parties, we affirm on the basis of the District Court's well reasoned opinion in General Reinsurance Corporation v. Missouri General Insurance, et al., 458 F.Supp. 1 (W.D.Mo.1977), with, however, one addendum. 5 The following language from the case of Homan v. Employers Reinsurance Corp., 345 Mo. 650, 136 S.W.2d 289, 298 (1939), supplies the basis for this Court's unwillingness to accept the third party beneficiary contention of appellant. The Supreme Court stated: "If the reinsurance contract was not to be subject to the provisions set out in the primary insurance contract, to wit, that any judgment against (the policyholder) be paid the contract could have been made definite and certain." In First National Bank of Kansas City v. Higgins, 357 S.W.2d 139, 145, (Mo.) the Supreme Court quoted this excerpt from the Homan case and stated, "We are in complete agreement with the above statements * * ." 6 In the context of the present case, Article I of Reinsurance Agreement No. 4191 provided, in part: "In no instance shall any insured of the Company or any claimant against an insured of the Company have any rights under this Agreement." By including the above clause in the Agreement of Reinsurance the parties have taken the course of action prescribed by the Court in Homan, supra, to avoid the reinsurer being held liable by the primary insured's policyholders, or their claimants. The clear intent of the parties to exclude original insureds and claimants against insureds from having any rights under the Agreement of Reinsurance is both definite and certain. In Article I of Agreement of Reinsurance No. 4191, General Reinsurance and Missouri General made very clear their intentions that General Reinsurance was not assuming the obligations of Missouri General on its policies. In so doing the parties foreclosed the possibility of General Reinsurance being held liable on a third party beneficiary theory to an original insured or to those who may claim under him. 7 The judgment of the District Court is affirmed. Roy W. Harper, Senior District Judge, Eastern District of Missouri, sitting by designation	{ "pile_set_name": "FreeLaw" }
345 F.Supp.2d 305 (2004) Ross G. LAING, Plaintiff, v. CDI CORPORATION, Defendant. No. 02-CV-6558L. United States District Court, W.D. New York. November 30, 2004. 306 Ross G. Laing, Pro Se, Rochester, NY. Scott D. Piper, Harris Beach LLP, Pittsford, NY, for Defendant. DECISION AND ORDER LARIMER, District Judge. INTRODUCTION Plaintiff, Ross G. Laing, commenced this action pro se against his former employer, defendant CDI Corporation, alleging racial discrimination in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. CDI is a staffing company that provides technical personnel to clients for temporary assignments. Plaintiff, an African-American, is a former contract employee with CDI who was assigned to work as a drafter in the fuel systems design area at Delphi Automotive, one of CDFs clients. Plaintiff alleges that CDI discriminated against him by failing to give him a scheduled raise in a timely fashion on account of his race. Plaintiff claims that it was only after he voiced complaints about the discriminatory treatment that he eventually was given the raise retroactively. Before the Court is CDIs motion for summary judgment. (Dkt.# 16). CDI argues that plaintiffs claims fail because he cannot show that he suffered an adverse employment action or that the alleged conduct occurred under circumstances giving rise to an inference of discrimination. As set forth below, CDI's motion for summary judgment is denied. 307 FACTS Unless otherwise indicated, the following facts are not in dispute. Plaintiff began working for CDI on January 28, 1999 as a drafter for $17.00 an hour. In March 2000, plaintiff received his first employee performance appraisal, which was quite positive. He received a raise to $21.00 an hour, retroactive to his anniversary date of hire, January 28. On February 1, 2001, plaintiff received another positive appraisal and a raise to $21.84 per hour, again retroactive to his January anniversary date. In January 2002, plaintiff claims that he was scheduled to receive another employee appraisal by manager Annette Kendrick. However, before that appraisal was completed, Kendrick was released as part of a reduction-in-force by CDI. Michael Callahan replaced Kendrick as manager and assumed her administrative duties, which included completing performance appraisals. On January 21, 2002, plaintiff asked Callahan about the status of his appraisal. Callahan told plaintiff he would get back to him. The next day, Callahan held a meeting with CDI employees during which he announced that, because Delphi cut the overall billing rate for employees, CDI was imposing a wage freeze and most employees would not receive raises. Those employees, however, that were scheduled to have or already had their appraisals on or before February 1, 2002, would receive raises. Plaintiff assumed that he was one of the employees that would receive an appraisal and raise because Kendrick had scheduled his appraisal for January 17, 2002, and his anniversary date was in January.[1] On February 19, 2002, Callahan met with plaintiff and gave him a positive appraisal. Callahan told plaintiff that he had received a 23% increase in pay over the last two years and that he would be leaving the financial part of the review blank pending a change by Delphi to his billing rate. Plaintiff believed that he was entitled to a raise and told Callahan as much. After this meeting, plaintiff learned that at least four white employees had received raises during this period. On March 20, 2002, plaintiff again met with Callahan to discuss why he had not received a raise. Callahan again denied that plaintiff was entitled to a raise because he was not on the calendar scheduled for an appraisal when the wage freeze went into effect. Callahan contacted Antonia Scott, a CDI human resources employee that had assisted Callahan in compiling the appraisal review list, and confirmed this fact during his meeting with plaintiff. On April 5, 2002, plaintiff called CDI's Regional Vice President, Scott Rhodes, and complained about the fact that he had not received a raise. Plaintiff told Rhodes that he believed Callahan had discriminated against him. Plaintiff told Rhodes that his anniversary date should control whether he was entitled to a raise. Rhodes told plaintiff he would investigate the matter and get back to him. On April 16, 2002, after speaking with Rhodes, Callahan met with plaintiff. Callahan denied discriminating against plaintiff, told him that he had just made a mistake. He should have used plaintiffs actual anniversary date to determine 308 whether he was eligible for a raise. Callahan then offered plaintiff a three percent raise retroactive to his anniversary date. Plaintiff responded that he believed CDI had treated him unfairly. He refused the raise and asked instead to be released immediately from his contract with CDI so that he could work for another contract supplier at Delphi.[2] Callahan allegedly agreed at first to release plaintiff from his contract, but when plaintiff asked for the release in writing, Callahan refused to release plaintiff. Callahan claimed to have conferred with Rhodes. He then told plaintiff that CDI would not release him from the contract, because it would set bad precedent for other employees. Plaintiff thereafter contacted Brenda Jones, CDI's Human Resource Generalist who was located in Arizona. Jones had ultimate human resource responsibility for all engineering employees, including plaintiff. Jones investigated plaintiffs complaint. Callahan told Jones that he was new to the manager's position, was very busy at the time, and simply had made a clerical mistake vis-a-vis plaintiffs raise. He claimed that, based on his quick review of plaintiffs file, it initially appeared that his last review occurred in February 2001, not January. Therefore, he believed that plaintiff was not eligible to receive the raise. After plaintiff complained about not receiving a raise, Callahan checked plaintiffs file again, saw that his anniversary date was in January. Once that was clarified, he offered plaintiff the raise retroactive to his anniversary date. He denied discriminating against plaintiff. After her investigation, Jones held a telephone conference with plaintiff, Callahan, and Patricia O'Connor, another human resources employee. Jones told plaintiff that Callahan denied discriminating against him. Callahan reiterated that he had made an "honest mistake" when he looked at plaintiffs file, and they again offered plaintiff the three percent raise with back pay. Plaintiff became upset during this call and again refused the raise. He told Jones that he thought CDI was covering up discrimination by Callahan, and that he wanted to be released from his contract. He also said that he wanted the investigation into his allegations of discrimination to be completed. Jones allegedly told plaintiff she would do that and get back to him. Plaintiff claims Jones never did get back to him. Instead, within a few weeks, Callahan met with plaintiff in late April or early May 2002 and gave him another written performance appraisal, which plaintiff refused to sign. This appraisal was identical to the one Callahan gave him in February 2002 and contained the same substantive evaluation of plaintiffs work performance. There was one difference between the February and May 2002 appraisals. The financial section of the May appraisal was completed and recommended that plaintiff receive a three percent raise retroactive to January 28, 2002. Plaintiff refused the raise again and refused to sign the appraisal on the grounds that he believed CDI was trying to cover up Callahan's discrimination. He continued to insist on a release from CDI. Despite his protestations, on May 9, 2002 plaintiff received a three percent raise to $22.50 an hour retroactive to January 28, 2002. In July 2002, after Delphi 309 increased plaintiffs billing rate, he received another raise to $30.00 an hour. Sometime in mid-2002, CDI went through another reduction-in-force, and Callahan was laid off along with several other employees. In February 2003, plaintiff resigned from CDI and accepted employment with another contract supplier at Delphi. He continues to work in the same drafter position at the same location as before. Plaintiff filed a charge of discrimination with the EEOC on July 23, 2002 claiming that he was not given a timely raise because of his race. On July 31, 2002, the EEOC dismissed plaintiffs charge and issued a right-to-sue letter. Plaintiff commenced this action in federal court on October 29, 2002. DISCUSSION I. Summary Judgment in Discrimination Cases When deciding a motion for summary judgment brought pursuant to Fed. R.Civ.P. 56, a court's responsibility is to determine whether there are issues to be tried. Duse v. Int'l Bus. Machs. Corp., 252 F.3d 151, 158 (2d Cir.2001). Summary judgment will be granted if the record demonstrates that "there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "A fact is `material' for these purposes if it `might affect the outcome of the suit under the governing law.' ... An issue of fact is `genuine' if `the evidence is such that a reasonable jury could return a verdict for the nonmoving party.'" Lovejoy-Wilson v. NOCO Motor Fuel, Inc., 263 F.3d 208, 212 (2d Cir.2001) (quoting Anderson, 477 U.S. at 248, 106 S.Ct. 2505); see also Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). The general principles regarding summary judgment apply equally to discrimination actions. See Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 148, 120 S.Ct. 2097, 147 L.Ed.2d 105 (2000) (quoting St. Mary's Honor Ctr. v. Hicks, 509 U.S. 502, 524, 113 S.Ct. 2742, 125 L.Ed.2d 407 (1993)) (reiterating "that trial courts should not `treat discrimination differently from other ultimate questions of fact.'"). Although courts should be cautious about granting summary judgment in cases where motive, intent or state of mind are at issue, see Dister v. Cont'l Group, Inc., 859 F.2d 1108, 1114 (2d Cir.1988); Montana v. First Fed. Sav. and Loan Ass'n of Rochester, 869 F.2d 100, 103 (2d Cir.1989), "the salutary purposes of summary judgment-avoiding protracted, expensive and harassing trialsapply no less to discrimination cases than to ... other areas of litigation." Meiri v. Dacon, 759 F.2d 989, 998 (2d Cir.1985) (summary judgment rule would be rendered sterile if mere incantation of intent or state of mind would act as a talisman to defeat an otherwise valid motion). I analyze plaintiffs discrimination claims pursuant to the familiar McDonnell Douglas burden-shifting rules. McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973). Plaintiff must first establish a prima facie case of discrimination. The burden then shifts to the defendant to articulate a legitimate, nondiscriminatory business rationale for its actions. "If the defendant has stated a neutral reason for the adverse action, `to defeat summary judgment ... the plaintiff's admissible evidence must show circumstances that would be sufficient to permit a rational finder of fact to infer that the defendant's employment decision was 310 more likely than not based in whole or in part on discrimination.'" Feingold v. New York, 366 F.3d 138, 152 (2d Cir.2004) (quoting Stern v. Trustees of Columbia Univ., 131 F.3d 305, 312 (2d Cir.1997)). To establish a prima facie case of discrimination under Title VII based on race, plaintiff must show: (1) that he belonged to a protected class; (2) that he was qualified for the position he held; (3) that he suffered an adverse employment action; and (4) that the adverse employment action occurred under circumstances giving rise to an inference of discriminatory intent. Feingold, 366 F.3d at 152. Defendant concedes that plaintiff has satisfied the first two elements. CDI's motion is directed to the third and fourth elements. II. Adverse Employment Action CDI argues that plaintiff suffered no adverse employment action because CDI eventually gave plaintiff the raise retroactive to his anniversary date. Therefore, CDI contends that plaintiff did not suffer a material change in the terms and conditions of his employment. I disagree. The Second Circuit has held that the lost use of wages, even if temporary, is a sufficient adverse employment action for purposes of the discrimination statutes. Lovejoy-Wilson, 263 F.3d at 224 (plaintiff established adverse employment action by proving she was suspended without pay for one week, despite the fact that defendant reimbursed her for the lost wages sometime later); see also Jin v. Metropolitan Life Ins. Co., 310 F.3d 84, 100 (2d Cir. 2002) ("the lost use of wages for a period of time is, by itself, an economic injury that can qualify as a tangible employment action" sufficient to hold employer liable for harassment). Moreover, although "adverse employment actions" often include discharge, refusal to hire, demotion, or reduction in pay, see, e.g., Morris v. Lindau, 196 F.3d 102, 110 (2d Cir.1999), they are not limited to those actions affecting just the "pecuniary emoluments" of employment. Preda v. Nissho Iwai Am. Corp., 128 F.3d 789, 791 (2d Cir.1997). The Second Circuit has repeatedly held that lesser actions can qualify under the statute, so long as they result in a materially adverse change in working conditions. See Morris, 196 F.3d at 110. It is undisputed that plaintiff was entitled to receive a pay raise, either because his anniversary date was in January or because his appraisal was scheduled in January. Plaintiff did not receive the raise and, therefore, lost the use of a small percentage of his wages for some measurable period of time, anywhere from one to three months, depending on when his raise originally was to have been processed.[3] In addition, he received the pay raise only after he made repeated complaints to Callahan and then upper management, which is a course of conduct other employees who received raises were not required to undertake. A jury could reasonably conclude that together, these actions constituted a material adverse change in the conditions of plaintiffs employment. Lovejoy-Wilson, 263 F.3d at 224 (although plaintiff was reimbursed for her lost wages, "the reimbursement occurred `some time later.' The plaintiff thus may have at least suffered the loss of the use of her wages for a time. This would be sufficient to support a jury's finding that she suffered an adverse employment action.").[4] That is particularly 311 true if the reason for the delay was Callahan's intentional discrimination based on plaintiffs race.[5] III. Inference of Discrimination CDI next argues that plaintiff cannot show that the adverse employment action occurred under circumstances giving rise to an inference of discrimination. At issue is Callahan's motivation when he initially denied plaintiff the raise. Based on the record as a whole, and drawing all reasonable inferences in plaintiffs favor, I find that questions of fact exist regarding Callahan's motivation that cannot be resolved on summary judgment. It is true that CDI presented evidence that Callahan simply made a "mistake" when he determined that plaintiff was ineligible to receive a raise. Callahan told Jones that he was new to the position and, based on a quick review of plaintiffs personnel file, it initially appeared to him that plaintiffs last review was in February 2001not January 2001. As a result, Callahan made the assumption that plaintiff was not eligible to receive another appraisal until February 2002, after the wage freeze. After plaintiff complained to Rhodes, Callahan rechecked plaintiffs file and saw that his anniversary date was January 28, and not in February, apologized and then offered him the raise. CDI also points to plaintiffs admission that he had very little contact with Callahan prior to February 2002, and that he had never heard Callahan direct derogatory comments about minorities to him or to other employees. Those explanations may well be accepted by the jury and, if so, plaintiffs claim would fail. Plaintiff submitted evidence, however, that calls into question Callahan's stated reasons for the delay in giving plaintiff the raise. First, the record shows that Callahan gave a different explanation on three occasions for why he determined that plaintiff was not eligible to receive a raise. Callahan first told plaintiff in February that he was not receiving a raise because he had had a substantial salary increase over the last two years, as compared to other CDI employees, and that he could not receive a raise until Delphi changed his billing rate. Then in March, Callahan told plaintiff he was not eligible for a raise because he was not on the calendar and was not scheduled for an appraisal prior to the wage freeze. Finally, when Jones investigated plaintiffs complaints of discrimination in April, Callahan told Jones that he made the decision that plaintiff was not eligible for a raise when he reviewed plaintiffs file and mistakenly relied on the date of his 2001 appraisal. The jury could determine that these multiple justifications belie the true reason. Furthermore, plaintiff has submitted evidence that the stated reasons are not 312 worthy of belief. As to Callahan's alleged confusion about whether plaintiff was scheduled for an appraisal before the wage freeze, Annette Kendrick, Callahan's predecessor at CDI, states in an affidavit that Callahan knew plaintiffs appraisal was scheduled for January 2002. (Kendrick affidavit, Dkt. # 27).[6] She states that on January 17, 2002, the last day she worked for CDI, she handed plaintiffs file to Callahan, told him that plaintiffs appraisal was scheduled for that morning, and that he was to receive a seven percent raise. She then gave Callahan the paperwork necessary to process plaintiffs raise, which she had already completed. She also directed Callahan's attention to a calendar on her desk that listed all scheduled appraisals, including that of the plaintiff, whose appointment was highlighted that day. As to Callahan's mistaken reliance on the date of plaintiffs 2001 appraisal, Kendrick states that Callahan was well aware of the fact that many 2001 appraisals were performed very late (i.e. subsequent to an employee's anniversary date) by Kendrick's predecessor, Tom Kuczynski, and that much of Kendrick's job was spent trying to get CDI caught up on the 2002 appraisals. Moreover, plaintiff points to the fact that his 2001 written appraisal, the document upon which Callahan claims to have relied when deciding whether plaintiff was eligible for a raise, states specifically that plaintiffs next appraisal was scheduled for January 2002. Plaintiff also presented evidence that Callahan had a discriminatory attitude toward women and minorities. Kendrick states that she complained to Brenda Jones and to Bob Lyons, Vice President of Human Resources, about Callahan's discriminatory attitude toward both minorities and women shortly after Callahan was hired in August 2001. She states that Callahan made comments to her during meetings about "those people," referring to minorities, and "you women," referring to Kendrick and others. Kendrick also claims that when she spoke with Jones about Callahan's discriminatory attitude, Jones acknowledged that Callahan "was going to be a problem," "was part of the 'old boys club mentality,'" and had "a Kodak mentality." Kendrick also states that CDI's attorney, Scott Piper, contacted her about this case and, during an interview with her, told her that Callahan had "caused many problems" and that CDI "just wanted to forget about him." Finally, the record shows that, including plaintiff, there were six employees that received raises retroactive to late 2001 or early 2002. It appears that all five of the other employees received their raises in a timely fashion. Further, at least four of these employees (Paul Reed, Jennifer Ustin, Catherine Vavonese, and Michael Yax), were white. The record does not indicate the race of the fifth employee (John Stoessel). In its reply, CDI submitted (but did not file)[7] the reply affidavit of Jones, who 313 denies making the statements to Kendrick regarding Callahan that are contained in Kendrick's affidavit. (See courtesy copy of Jones Reply Affidavit, received on November 13, 2003). In addition, CDI filed the affidavit of its attorney of record, Mr. Piper, who denies making any such statements about Callahan to Kendrick. The point of the above elaboration is to demonstrate that questions of fact exist as to whether Callahan was motivated by discriminatory animus against plaintiff because he is black or made a simple clerical error in denying plaintiffs raise. There is conflicting evidence. But, there is sufficient evidence in the record that Callahan's failure to give plaintiff a timely raise occurred under circumstances giving rise to an inference of discrimination. Plaintiff has also presented sufficient evidence upon which a jury could find that the reasons CDI gave for Callahan's actions were unworthy of belief. See Reeves, 530 U.S. at 147, 120 S.Ct. 2097 (2000) ("it is permissible for the trier of fact to infer the ultimate fact of discrimination from the falsity of the employer's explanation."); Zimmermann v. Assocs. First Capital Corp., 251 F.3d 376, 382-83 (2d Cir.2001) (same). These factual disputes cannot be decided by the Court as a matter of law, but must resolved by a jury. Therefore, CDI's motion for summary judgment is denied.[8] CONCLUSION Defendant CDI's motion for summary judgment (Dkt.# 16) is denied. IT IS SO ORDERED. NOTES [1] There appears to be a dispute about whether plaintiff was, in fact, scheduled for an appraisal. Plaintiff claims that Kendrick had scheduled his appraisal on her "calendar" for 10:30 a.m. on January 17, 2002, the same day that she was released pursuant to the reduction-in-force. Kendrick, who submitted an affidavit on plaintiff's behalf in opposition to CDI's motion for summary judgment, corroborates this and states that she spoke with Callahan specifically about plaintiff's scheduled appraisal and raise. (Dkt.# 27). CDI, however, claims that it has no record of any such calendar. [2] It appears that CDI employees sign an agreement that includes a provision requiring them, upon termination or resignation, to wait 30 days before joining another contractor at the same work site. The provision is designed to prevent employees from continuously switching from contractor to contractor in search of better wages. [3] There may be an issue as to the length of this time period, given that plaintiff declined the raise for the first time sometime in mid-April. [4] Smith v. Alabama, 252 F.Supp.2d 1317, 1333 (M.D.Ala.2003) aff'd, 103 Fed. Appx. 666 (11th Cir. Apr.9, 2004), the case upon which defendant primarily relies, is distinguishable. There, plaintiff alleged that his supervisor denied his request to draft a letter requesting plaintiff's salary increase, resulting in plaintiff having to draft the letter himself for his supervisor's signature. Plaintiff then received the salary increase. Plaintiff argued that his supervisor's action of refusing to assist him in obtaining his raise constituted an adverse employment action. Interpreting Eleventh Circuit case law, the Court held that no reasonable juror could conclude that such a mere inconvenience without any "tangible harm" constituted an adverse employment action. Id. at 1333. Here, however, plaintiff did suffer some tangible employment action in the lost use of wages for a period of time, which the Second Circuit has held is a sufficient adverse employment action. [5] It is noteworthy that plaintiff testified at his deposition that he felt stress and anxiety at his job during this course of these events, and that he resigned from CDI nine months later. [6] CDI makes the bold argument that, because Kendrick was terminated from CDI as part of a reduction-in-force, her entire affidavit is "suspect as biased, and should be disregarded by the Court." (Dkt.# 28, p. 5). Whether Kendrick is biased, and what role, if any, that alleged "bias" would have on the weight to be given her sworn statement is not for the Court to decide. Under well-settled principles, the Court's role in deciding a summary judgment motion is not to weigh evidence, but to determine whether there are issues to be tried. [7] The docket sheet indicates that this affidavit was never filed. Most likely, this is because Jones' affidavit does not contain an original signature, but only a fax copy. A courtesy copy of the affidavit, which was received by the Court on November 13, 2003, is found in the file. The Court has assumed for purposes of this motion that this affidavit was properly filed and, therefore, has considered the allegations contained therein. [8] Finally, CDI seeks to dismiss so much of plaintiff's complaint that asserts a retaliation claim against it on the grounds that such a claim was not included in plaintiff's EEOC charge. I disagree. It is well-settled that claims not asserted in an EEOC charge may be pursued in a subsequent federal court action if they are "reasonably related" to claims that were filed with the agency. Deravin v. Kerik, 335 F.3d 195, 200-201 (2d Cir.2003); Legnani v. Alitalia Linee Aeree Italiane, S.P.A., 274 F.3d 683, 686 (2d Cir.2001). A claim that an employer retaliated against an employee for filing a charge of discrimination is considered "reasonably related" to the original claim. Butts v. City of N. Y. Dep't of Hons. Pres. & Dev., 990 F.2d 1397, 1402-1403 (2d Cir. 1993). Moreover, "[a] claim is considered reasonably related if the conduct complained of would fall within the scope of the EEOC investigation which can reasonably be expected to grow out of the charge that was made." Fitzgerald v. Henderson, 251 F.3d 345, 359-60 (2d Cir.2001 Xinternal quotation marks and citation omitted). Under either theory here, plaintiff's claim of retaliation would be reasonably related to his original charge. Therefore, CDI's motion for summary judgment on plaintiff's retaliation claim is denied.	{ "pile_set_name": "FreeLaw" }
429 So.2d 686 (1983) Ronald Tabor RICE v. STATE. No. 8 Div. 746. Court of Criminal Appeals of Alabama. March 29, 1983. John Mark McDaniel of McDaniel & McDaniel, Huntsville, for appellant. Charles A. Graddick, Atty. Gen., and Thomas R. Allison, Asst. Atty. Gen., for appellee. DeCARLO, Presiding Judge. Appellant was convicted of child molestation and sentenced to three years' imprisonment. On November 17,1978, this sentence was suspended and he was placed on probation for four years. Appellant was arrested on May 12, 1982, on a probation violator's warrant issued January 21, 1982. A probation hearing was held on two separate occasions. Appellant presented witnesses in his behalf on July 13, 1982. The case was then continued until July 26, 1982, when the State presented its witnesses. At the conclusion of the State's case, the trial court found that the appellant had "violated the terms and conditions of his Probation by committing an act of Indecent Exposure in the presence of a young female child, the age of eleven, and also by failing to report to the Probation Office as required" and revoked appellant's probation. *687 I Appellant asserts that his 5th and 14th Amendment rights to due process were violated because he was not given a preliminary hearing at the time of his arrest and detention. He relies on Gagnon v. Scarpelli, 411 U.S. 778, 779, 93 S.Ct. 1756, 1758, 36 L.Ed.2d 656 (1973), and Morrissey v. Brewer, 408 U.S. 471, 92 S.Ct. 2593, 33 L.Ed.2d 484 (1972), arguing that these cases require that a probationer be given both a preliminary and a final revocation hearing. The Alabama Supreme Court has set forth "the requirements and guidelines which must be met for minimal due process to be accorded the probationer under Morrissey and Gagnon before his probation can be revoked." Armstrong v. State, 294 Ala. 100, 312 So.2d 620 (1975). In setting forth those requirements, the Supreme Court stated: "7. We see no valid reason for having two hearings if the probationer has been given sufficient notice of the charges and the evidence to be relied on for revocation of probation. If the probationer has not had time to prepare to refute the charges and evidence against him, he can have a timely continuance." It is very clear from the record that appellant was given sufficient notice of both the charges against him and the evidence to be relied on. No contention is made to the contrary. Further, every requirement under Armstrong was complied with. Therefore, we find no violation of appellant's due process rights. II Appellant contends that the evidence was not sufficient to sustain his probation revocation. "There is no definite criterion or measure of proof necessary to justify the revocation of one's probation." Wright v. State, 349 So.2d 124 (Ala.Cr.App.1977). The evidence need not "be strong enough to convince the court beyond a reasonable doubt that the probationer has violated a term of his probation", Carter v. State, 389 So.2d 601 (Ala.Cr.App.1980); it needs only to reasonably satisfy the court of the truth of the charge. Goodrum v. State, 418 So.2d 942 (Ala.Cr.App.1982). Absent a gross abuse of discretion, the trial court's ruling in a probation revocation will not be disturbed by this Court. Wright, supra. We find no abuse of discretion in this case. For the reasons stated above, the judgment of the Madison Circuit Court is hereby affirmed. AFFIRMED. All the Judges concur.	{ "pile_set_name": "FreeLaw" }
IN THE SUPREME COURT OF THE STATE OF DELAWARE PETER BRINCKERHOFF, § INDIVIDUALLY AND AS TRUSTEE § OF THE PETER R. BRINCKERHOFF § REV. TR U A DTD 10/17/97, and on § No. 273, 2016 § behalf of all others similarly situated, § Court Below—Court of Chancery Plaintiff Below, Appellant, § of the State of Delaware § v. § C.A. No. 11314 § ENBRIDGE ENERGY COMPANY, § INC., et al., § § Defendants Below, Appellees, § § and § § ENBRIDGE ENERGY PARTNERS, § L.P., § § Nominal Defendant Below, § Appellee. § Submitted: January 11, 2017 Decided: March 20, 2017 Before STRINE, Chief Justice; HOLLAND, VALIHURA, VAUGHN, and SEITZ, Justices, constituting the Court en Banc. Upon appeal from the Court of Chancery: REVERSED Jessica Zeldin, Esquire, Rosenthal, Monhait & Goddess, P.A., Wilmington, Delaware; Lawrence P. Eagel, Esquire (argued), Jeffrey H. Squire, Esquire and David J. Stone, Esquire, Bragar Eagel & Squire, P.C., New York, New York, for Plaintiff, Appellant, Peter Brinckerhoff. Raymond J. DiCamillo, Esquire, Richards, Layton & Finger, P.A., Wilmington, Delaware; Michael H. Steinberg, Esquire (argued), Sullivan & Cromwell LLP, Los Angeles, California; Laura Kabler Oswell, Esquire, Sullivan & Cromwell LLP, Palo Alto, California, for Defendants, Appellees, Enbridge Inc., J. Richard Bird, J. Herbert England, C. Gregory Harper, D. Guy Jarvis, Mark A. Maki, John K. Whelen and Enbridge Pipelines (Alberta Clipper) L.L.C. Thomas W. Briggs, Jr., Esquire and Richard Li, Esquire, Morris, Nichols, Arsht & Tunnell LLP, Wilmington, Delaware; Kevin C. Logue, Esquire (argued) and Kevin P. Broughel, Esquire, Paul Hastings LLP, New York, New York, for Defendants, Appellees, Enbridge Energy Company, Inc., Enbridge Energy Management, L.L.C., Jeffrey A. Connelly, Rebecca B. Roberts, Dan A. Westbrook, Enbridge Energy Limited Partnership and Nominal Defendant Enbridge Energy Partners, L.P. SEITZ, Justice: The plaintiffs, Peter Brinckerhoff and his trust, are long-term investors in Enbridge Energy Partners, L.P. (“EEP”), a Delaware master limited partnership (“MLP”). As followers of this investment space know, MLPs are set up in the petroleum transportation business to allow sponsors and public investors to take advantage of favorable tax laws. Another benefit under Delaware law is the ability to eliminate common law duties in favor of contractual ones, thereby restricting disputes to the four corners of the limited partnership agreement (“LPA”). MLPs are typically families of entities that often engage in internal business transactions, referred to as dropdowns, rollups, insider financings, incentive distribution rights, and equity investments. Because the entities proposing transactions often have representatives seated at both sides of the negotiating table, the LPAs typically attempt to address conflicts using various contractual tools. Even so, disputes still arise over whether the conflicted parties have complied with the letter and spirit of the LPA. Our Court has frequently been called upon to interpret a number of LPAs to resolve these disputes.1 1 E.g., Dieckman v. Regency GP LP, __ A.3d __, 2017 WL 243361, (Del. Jan. 20, 2017); El Paso Pipeline GP Co., L.L.C. v. Brinckerhoff, __ A.3d __, 2016 WL 7380418, (Del. Dec. 20, 2016); Employees Ret. Sys. of the City of St. Louis v. TC Pipelines GP, Inc., 2016 WL 7338592 (Del. Dec. 19, 2016) (TABLE); Haynes Family Trust v. Kinder Morgan G.P., Inc., 2016 WL 912184 (Del. March 10, 2016) (TABLE); Allen v. El Paso Pipeline GP Co., L.L.C., 2015 WL 803053 (Del. Feb. 26, 2015) (TABLE); Allen v. Encore Energy Partners, L.P., 72 A.3d 93 (Del. 2013); Gerber v. Enter. Prods. Holdings, LLC, 67 A.3d 400 (Del. 2013) overruled on other grounds by Winshall v. Viacom Intern., Inc., 76 A.3d 808 (Del. 2013); Norton v. K-Sea Transp. Partners L.P., 67 A.3d 354 (Del. 2013); Brinckerhoff v. Enbridge Energy Co., 67 A.3d 369 (Del. 2013). This is not the first lawsuit between Brinckerhoff and the Enbridge MLP entities over a conflicted transaction. In 2009, Brinckerhoff filed suit against most of the same defendants in the current dispute, and challenged a transaction between the sponsor and the limited partnership. Enbridge, Inc. (“Enbridge”), the ultimate parent entity that controlled EEP’s general partner, Enbridge Energy Company, Inc. (“EEP GP”), proposed a joint venture agreement (“JVA”) between EEP and Enbridge, whereby Enbridge would contribute 66.7% and EEP would contribute 33.3% of the cost, and share the profits in the same proportion, of the Alberta Clipper project—a proposed pipeline used to transport petroleum from the Alberta tar sands to the United States. Brinckerhoff contested the fairness of the transaction on a number of grounds. After several rounds in the Court of Chancery leading to the dismissal of his claims, and a trip to our Court, Brinckerhoff eventually came up short when we affirmed the Court of Chancery’s ruling that he had waived his claims for reformation and rescission of the transaction by failing to assert them first in the Court of Chancery.2 2 Brinckerhoff v. Enbridge Energy Co., Inc. (“Brinckerhoff I”), 2011 WL 4599654 (Del. Ch. Sept. 30, 2011); Brinckerhoff v. Enbridge Energy Co., Inc., No. 574, 2011 (Del. March 27, 2012) (Remand Order); Brinckerhoff v. Enbridge Energy Co., Inc. (“Brinckerhoff II”), 2012 WL 1931242 (Del. Ch. May 25, 2012); Brinckerhoff v. Enbridge Energy Co., Inc. (“Brinckerhoff III”), 67 A.3d 369 (Del. 2013). 2 The Alberta Clipper project would blow east again into the Court of Chancery. In 2014, Enbridge proposed that EEP repurchase Enbridge’s interest in the Alberta Clipper project (“Alberta Clipper Interest”), excluding the expansion rights that were part of the earlier transaction. As part of the billion dollar transaction, EEP would issue to Enbridge $694 million of a new class of EEP partnership securities designated Class E Units, repay $306 million in outstanding loans made by EEP GP to EEP, and, central to the current dispute, amend the LPA to effect a “Special Tax Allocation” whereby the public investors would be allocated items of gross income that would otherwise be allocated to EEP GP. The allocation of gross income for tax purposes has important consequences to the public investors. According to Brinckerhoff, the Special Tax Allocation unfairly benefited Enbridge by reducing its tax obligations by hundreds of millions of dollars while increasing the taxes of the public investors, thereby undermining the investor’s long-term tax advantages in their MLP investment. Brinckerhoff filed suit and alleged that the defendants breached the LPA by (a) agreeing to repurchase the same asset—the Alberta Clipper Interest—EEP sold to Enbridge six years earlier, on terms Brinckerhoff claims were not “fair and reasonable” as required by Section 6.6(e) of the LPA; and (b) implementing the Special Tax Allocation that, according to Brinckerhoff, materially adversely 3 affected the investors, and enlarged their “obligations,” in violation of Sections 5.2(c) and 15.3(b) of the LPA. EEP GP and its Affiliates moved to dismiss, claiming that, regardless of any breach of the LPA’s specific affirmative requirements, before Brinckerhoff could pursue his claims, he first had to plead facts leading to an inference that the defendants acted in bad faith. In other words, EEP GP and its affiliates were free to breach any of the LPA’s specific requirements, so long as they did so in good faith. The defendants also argued that to allege bad faith, Brinckerhoff had to plead facts that ruled out all legitimate explanations for the defendants’ actions except for bad faith—a pleading hurdle borrowed from one of the most demanding corporate law standards, that of “waste.” The Court of Chancery did its best to reconcile earlier decisions interpreting the same or a similar LPA, and ended up dismissing the complaint. Though the court believed that in the corporate context Brinckerhoff’s allegations would have stated a claim, it concluded that so long as EEP GP acted in good faith, it was free to breach any of the LPA’s specific requirements. Once that standard applied, the court found that Brinckerhoff had failed to allege bad faith conduct by EEP GP, which required dismissal of the complaint. On appeal, Brinckerhoff has challenged the reasonableness of the Court of Chancery’s interpretation of the LPA. He also argues that this Court in 4 Brinckerhoff III improperly defined what was needed to plead bad faith. As Brinckerhoff sees it, his allegations that (a) the partnership agreed to pay $200 million more to Enbridge to repurchase the same asset it sold in 2009, despite declining EBITDA, slumping oil prices, and the absence of expansion rights sold in 2009; (b) EEP’s financial advisor ignored the 2009 transaction as a comparable transaction; (c) EEP GP added hundreds of millions of dollars more in benefits for itself and Enbridge through the Special Tax Allocation, to the detriment of the public unitholders and in breach of specific provisions of the LPA; and (d) the Special Tax Allocation was not properly valued when determining whether the transaction’s terms were fair and reasonable to the Partnership—support a fair pleading-stage inference of bad faith that precludes dismissal. We agree with Brinckerhoff in part and reverse the decision of the Court of Chancery. We say in part because we agree with the defendants that the Special Tax Allocation did not breach Sections 5.2(c) and 15.3(b) governing new unit issuance and tax allocations. But, we find that the Court of Chancery erred when it held that other “good faith” provisions of the LPA “modified” Section 6.6(e)’s specific requirement that the Alberta Clipper transaction be “fair and reasonable to the Partnership.” The provisions of the LPA relied on by the Court of Chancery— Sections 6.8(a), 6.9(a), and 6.10(d)—exculpate EEP GP and others from monetary damages if they act in good faith, apply a good faith standard to EEP GP’s 5 resolution of conflicts of interest, and replace default fiduciary duties with a contractual good faith standard. They do not, however, alter the specific affirmative obligations of the LPA. The Court of Chancery’s interpretation of the LPA leads to an unreasonable result no public investor would have considered possible when reviewing the LPA—that EEP GP is free to violate any specific LPA requirement so long as the breach is in good faith. In fact, precisely because the Delaware Revised Uniform Limited Partnership Act (“DRULPA”) allows LPAs—like that of the Enbridge LPA—to eliminate fiduciary duties, it is essential that unitholders be able to hold the GP accountable for not complying with the terms of the LPA. We also find that the Court of Chancery erred when it determined that EEP GP and its Affiliates were exculpated under Section 6.8(a) from any liability for breaching the LPA. The Court of Chancery cannot be faulted for faithfully applying our earlier decision in Brinckerhoff III, and its rigorous pleading standard for bad faith. But we now change course from our earlier decision and adhere to the more traditional definition of bad faith utilized in Delaware entity law. We hold that bad faith is sufficiently alleged under the Enbridge LPA if the plaintiff pleads facts supporting an inference that EEP GP did not reasonably believe it was acting in the best interest of the partnership. Accepting the facts as pled, as we must on an appeal from a motion to dismiss, Brinckerhoff has met this standard. 6 On remand, Brinckerhoff can proceed on his claim that the Alberta Clipper transaction violated Section 6.6(e). If the Court of Chancery eventually finds a breach of Section 6.6(e), and the defendants as Indemnitees are not immune from monetary damages under Section 6.8(a) because they acted in bad faith, the court can assess monetary damages to remedy the breach. Alternatively, if the defendants are immune from monetary damages under Section 6.8(a) because they acted in good faith, or the court finds that monetary damages would be speculative or difficult to determine reliably, then we leave it to the Court of Chancery’s broad discretion, after its evaluation of all of the circumstances of the case, whether to impose an equitable remedy tailored to address the harm caused by the breach of Section 6.6(e) of the LPA. I. Peter Brinckerhoff is a unitholder of 73,080 Class A EEP common units. The defendants and their business relationships are as follows: EEP - A publicly-traded Delaware MLP headquartered in Houston, Texas. EEP’s business focuses on energy transportation in the mid- Continent and Gulf Coast regions of the United States. EEP was formed in 1991 to own and operate the Lakehead pipeline system, the United States portion of a crude oil and liquid petroleum pipeline system running through portions of Canada and the United States. EEP GP - The general partner of EEP. EEP GP is a Delaware corporation wholly owned by Enbridge, Inc. EEP GP owns a 2% general partnership interest and 38.1% limited partnership interest in EEP. EEP GP also owns 100% of the voting shares and 11.7% of the listed shares of Enbridge Energy Management, L.L.C. 7 Enbridge Energy Management, L.L.C. (“Enbridge Management”) - EEP’s designated manager. Enbridge Management owns a 14.7% limited partnership interest in EEP. Enbridge - EEP GP’s controlling parent. Enbridge is a Canadian energy corporation operating an integrated midstream asset network in Canada and the United States. Enbridge indirectly owns 100% of EEP GP. Through its control of EEP GP and Enbridge Management, Enbridge controls a 2% general partnership interest and a 52.8% limited partnership interest in EEP. The following chart from the Court of Chancery’s opinion depicts the relationships between the entities. The remaining defendants, Jeffrey A. Connelly, Rebecca B. Roberts, Dan A. Westbrook, J. Richard Bird, J. Herbert England, C. Gregory Harper, D. Guy Jarvis, 8 Mark A. Maki, and John K. Whelen (the “Director Defendants”) each served as directors, and in some cases, officers of EEP GP and Enbridge Management. Defendants Roberts and England also served as Enbridge directors, and Bird, Harper, Jarvis, Maki, and Whelen served as Enbridge officers. A. In early 2009, EEP owned 100% of the Alberta Clipper project, a proposed $1.2 billion pipeline construction project extending almost a thousand miles from Hardisty, Alberta to Superior, Wisconsin.3 EEP wanted to build the pipeline to meet the expected petroleum demands in the Midwestern United States. In April 2009, Enbridge proposed a joint venture to EEP whereby Enbridge would contribute 75% and EEP would contribute 25% of the Alberta Clipper project’s costs. Profits would be divided according to their percentage contributions. The transaction also included expansion rights.4 EEP GP formed a Special Committee to determine whether the Alberta Clipper project transaction was “fair and reasonable to [EEP] and its unitholders,”5 and to make a recommendation whether to pursue the transaction. The Special 3 The Alberta Clipper project was operated through another operating limited partnership, OLP. EEP’s and EEP GP’s interests in the Alberta Clipper project were held through their percentage interest in OLP. The OLP entity is immaterial to the dispute. App. to Opening Br. at 329, n. 7 (Answering Br. in Opposition to Mot. to Dismiss), 25-29 (Compl. ¶¶ 18-25), 34-35 (Compl. ¶¶ 38-39). 4 When complete, the expansion projects would increase the Alberta Clipper pipeline’s U.S. throughput capacity from 450,000 to 800,000 bpd, a 78% increase in capacity. Id. at 21 (Compl. ¶ 7). 5 Brinckerhoff I, 2011 WL 4599654, at 2. 9 Committee hired a financial advisor who was asked to evaluate whether the Alberta Clipper transaction “was representative of an arm’s length transaction.”6 In response to Enbridge’s proposal, the Special Committee recommended that EEP retain a 33.3% equity stake in the Alberta Clipper project. EEP agreed to the revised split. The financial advisor then opined that the JVA’s terms “are representative, in all material respects, of those that would have been obtained by the Partnership in an arm’s length transaction.”7 The Special Committee thereafter recommended the transaction to EEP GP’s board. When the transaction closed in 2009, the 66.7% Alberta Clipper Interest was valued at $800 million, a multiple of 7x EBITDA. Brinckerhoff alleged that the Special Committee’s financial advisor typically recommended a 9-12x forward year EBITDA multiple. Brinckerhoff filed a complaint in the Court of Chancery asserting derivative and direct claims against most of the same defendants named in the current action. Relying on multiple legal theories, Brinckerhoff essentially claimed that EEP GP and others sold the Alberta Clipper Interest to Enbridge for an unreasonably low price. In Brinckerhoff I, the Court of Chancery recognized that the Enbridge LPA contained a specific provision, Section 6.6(e), covering the JVA. Section 6.6(e) required that the JVA be “fair and reasonable to the Partnership.” But the court 6 Id. 7 Id. at 3. 10 jumped to another LPA provision, Section 6.8(a), which exculpates Indemnitees, including EEP GP, from monetary damages if the Indemnitee acted in good faith. Invoking the conclusive presumption of good faith in Section 6.10(b) when EEP GP relies on a qualified advisor, the Court of Chancery found that EEP GP was exculpated from monetary damages. The other defendants were also found to have acted in good faith. The court dismissed the complaint without considering the possibility of equitable relief to remedy a breach of Section 6.6(e). Brinckerhoff appealed the dismissal. Before considering the merits of the appeal, our Court remanded to the Court of Chancery to consider “the sufficiency of [Brinckerhoff’s] claims for reformation and rescission under Chancery Court Rule 12(b)(6) in the first instance.”8 Following remand, the court issued its decision in Brinckerhoff II, finding that equitable relief could be a viable remedy for breach of the LPA, but also ruling that Brinckerhoff waived his right to seek any equitable relief. In Brinckerhoff III, we affirmed the Court of Chancery’s decisions in Brinckerhoff I and II. Specifically, we affirmed both the finding of waiver, and absence of bad faith. Using corporate law principles similar to pleading waste, we found that Brinckerhoff had failed to allege that “the decision to enter into the JVA, under the circumstances, must be ‘so far beyond the bounds of reasonable 8 Brinckerhoff v. Enbridge Energy Co., Inc., No. 574, 2011 (March 27, 2012) (Remand Order). 11 judgment that it seems essentially inexplicable on any ground other than bad faith.’”9 B. Turning to the current dispute, Brinckerhoff claims that, during the five years before the announcement of the next Alberta Clipper transaction, crude oil prices declined, reflected in the Alberta Clipper project’s nearly 20% decrease in projected EBITDA. Further, tariffs on the Alberta Clipper project faced increased risk that they would be rebased with long-term negative effect on revenue. Despite this negative environment, on September 16, 2014, Enbridge proposed a sale of its Alberta Clipper Interest, excluding the earlier expansion rights, to EEP for $1 billion, a multiple of 10.7x EBITDA. The purchase price consisted of $694 million in newly issued Class E units and approximately $306 million in repaid debt. As part of the transaction, the LPA would be amended to “allocate to the Public Unitholders significant items of gross income that [would otherwise] have been allocated to [General Partner],” referred to as the Special Tax Allocation.10 According to Brinckerhoff, the Special Tax Allocation benefited Enbridge in two ways. First, it would offset a $410 million capital gain EEP GP expected to 9 Brinckerhoff III, 67 A.3d at 373 (quoting Parnes v. Bally Entm’t Corp., 722 A.2d 1243, 1246 (Del. 1999)). 10 App. to Opening Br. at 19 (Compl. ¶ 2). 12 incur on the sale of its Alberta Clipper Interest back to EEP.11 Second, EEP GP would receive fewer cash distributions from EEP on the Class E Units than EEP GP would have received from the Alberta Clipper Interest. Brinckerhoff claims the Special Tax Allocation depressed EEP GP’s allocation of Partnership income by an additional amount to lower EEP GP’s tax burden. The bottom line, according to Brinckerhoff, is EEP GP’s unfair shift of a large tax burden from EEP GP to the public unitholders. Brinckerhoff alleges that the Special Tax Allocation amounts to approximately “$24.8 million of additional gross income, per year, for 22 years (or approximately $545.6 million in total), and then approximately $12.4 million per year thereafter in perpetuity.”12 According to the complaint, “the Special Tax Allocation increases the proportion of Partnership income taxes for which Class A and B common unit holders and Class D unit holders are responsible, without the benefit of receiving distributions in that proportion.”13 11 According to Brinckerhoff, partnership allocations of gross income to unitholders are simply book entries. No money changes hands. These amounts are, however, gross income immediately taxable to the unitholder. When cash is distributed to unitholders, it is considered a return of capital and is not immediately taxable. But the cash distributions lower the cost basis for each unit (as other factors impact basis such as deductions and taxable partnership income). As “estate” assets, many unitholders invest in MLP units with an eye towards a stepped-up basis at death, wiping out the built-up taxable gain in the units. Id. at 690-91 (Basic Tax Principles for MLP Investors Pamphlet). 12 Id. (Compl. ¶ 2). 13 Brinckerhoff v. Enbridge Energy Co., Inc. (“Brinckerhoff IV”), 2016 WL 1757283, at 4, n. 26 (Del. Ch. Apr. 29, 2016). 13 In response to Enbridge’s proposal, Enbridge Management, as designated manager for EEP GP, formed a Special Committee consisting of Roberts, Connelly, and Westbrook. The Special Committee’s charge was to determine whether the offer was fair and reasonable to EEP and its unitholders (other than EEP GP and its affiliates), and whether they should proceed with the transaction or seek alternatives.14 The Special Committee hired legal counsel and an investment banker, Simmons & Company International (“Simmons”). During a presentation on December 23, 2014, Simmons explained to the Special Committee that, “[a]t the updated proposed transaction value of $1 billion, [EEP GP] is projected to have a large taxable gain of $410 million on the sale of its units in Alberta Clipper.”15 Thus, “to be cash neutral, the taxable gain will be allocated to the EEP A, B, and D [unitholders].”16 Enbridge planned to partially offset the increased tax burden by allocating additional “depreciation to the A, B, and D units.”17 Simmons informed the Special Committee that the Special Tax Allocation would “negate most of the accretion the Public Unitholders would otherwise obtain from the Transaction.”18 On December 23, 2014, Simmons concluded that “the Transaction is fair to [EEP] and to the holders of EEP’s 14 App. to Opening Br. at 83 (Simmons Presentation). 15 Id. at 113. 16 Id. 17 Id. 18 Id. at 41 (Compl. ¶ 59). According to Brinckerhoff, although the Special Committee knew that the Special Tax Allocation represented additional consideration paid to EEP GP for the Alberta Clipper Interest, it never learned how much that consideration was worth. 14 common units (other than [EEP GP] and its affiliates) from a financial point of view.”19 The Special Committee then recommended the transaction, and EEP GP approved the transaction the same day.20 On January 2, 2015, EEP repurchased from Enbridge the Alberta Clipper Interest, excluding the Alberta Clipper project expansion rights, for $1 billion. On the same day, EEP GP amended the 6th LPA to create the 7th LPA, adding Section 5.2(i) to implement the Special Tax Allocation. C. On July 20, 2015, Brinckerhoff filed an eight-count complaint in the Court of Chancery against the defendants. In essence, the complaint claims that the defendants violated three specific provisions of the LPA by approving the Alberta Clipper transaction—Section 6.6(e), requiring that contracts with Affiliates be “fair and reasonable to the Partnership”; Section 5.2(c), governing new unit issuance; and Section 15.3(b), prohibiting enlargement of the unitholders’ “obligations” under the LPA. Brinckerhoff sought monetary damages against all defendants, and equitable relief rescinding the Alberta Clipper transaction or reforming the transaction “to render the Transaction fair and reasonable to EEP and the Public 19 Id. at 307 (Simmons Fairness Opinion). 20 Enbridge announced in a press release the same day that EEP agreed to purchase the Alberta Clipper Interest. The press release stated that the Class E units would be entitled to the same distributions as Class A common units held by the public. It did not mention the Special Tax Allocation. See App. to Opening Br. at 75-76 (Press Release). 15 Unitholders” and to remove the newly-added Section 5.2(i) implementing the Special Tax Allocation.21 Following briefing on the defendants’ motion to dismiss, the Court of Chancery granted the motion. Relying on the trilogy of earlier Brinckerhoff decisions and other MLP cases, the court set aside the LPA’s specific requirements and focused instead on the LPA’s good faith standards. According to the court, “Brinckerhoff was obliged to state well-pled facts that would allow a reasonable inference that Defendants acted in bad faith” before considering his LPA breach claims.22 Because he had failed to do so under the rigorous pleading standard adopted in Brinckerhoff III, the court ruled that the defendants were exculpated from any liability under the LPA, and dismissed the complaint.23 This appeal followed. II. We turn to the gating issue on appeal—whether the Court of Chancery correctly found that the LPA can reasonably be interpreted to permit EEP GP to breach any of the LPA’s specific requirements if EEP GP acts in good faith. 21 Id. at 73 (Compl.). 22 Brinckerhoff IV, 2016 WL 1757283, at 20. 23 The Court of Chancery wondered about the impact of its ruling excusing compliance with the specific provisions of the LPA if EEP GP acted in good faith: “In response to this conclusion, one might reasonably ask whether EEP GP, as a practical matter, is relieved of all obligations to act in compliance with the detailed provisions of a limited partnership agreement that comprehensively address[es] nearly all aspects of the relationship between the general and limited partners.” Id. at 18, n. 125. 16 Because the appeal is from a decision granting a motion to dismiss, we review the claims of error de novo.24 The Court of Chancery did its best to attempt to reconcile complex contractual provisions and confusing precedent. In this appeal, we change course from the earlier pleading standard announced in Brinckerhoff III to which the Court of Chancery was bound, and apply the definition of bad faith that is commonly used in our entity law and incorporated into the Enbridge LPA. We also hold that the LPA’s general good faith standards do not displace specific affirmative obligations contained in other provisions of the LPA. A. The DRULPA permits the LPA drafter to disclaim fiduciary duties, and replace them with contractual duties.25 The drafter cannot, however, disclaim the implied covenant of good faith and fair dealing.26 If fiduciary duties have been validly disclaimed, the limited partners cannot rely on traditional fiduciary principles to regulate the general partner’s conduct. Instead, they must look exclusively to the LPA’s complex provisions to understand their rights and 24 Cent. Mortg. Co. v. Morgan Stanley, 27 A.3d 531, 535 (Del. 2011) (citing Savor, Inc. v. FMR Corp., 812 A.2d 894, 896 (Del. 2002)). 25 6 Del. C. § 17-1101(d). 26 Id. 17 remedies.27 Further, when trying to square existing precedent with the language of different LPAs, we have observed that: Although the limited partnership agreements in all of these cases contain troublesome language, each decision was based upon significant nuanced substantive differences among each of the specific limited partnership agreements at issue. That is not surprising, because the Delaware Revised Uniform Limited Partnership Act is intended to give “maximum effect to the principle of freedom of contract.” Accordingly, our analysis here must focus on, and examine, the precise language of the LPA that is at issue in this case.28 Turning to the provisions of the Enbridge LPA, Section 6.10(d) of the LPA modifies, waives or limits common law duties in favor of contractual duties: Any standard of care and duty imposed by this Agreement or under the Delaware Act of any applicable law, rule or regulation shall be modified, waived or limited as required to permit the General Partner to act under this Agreement or any other agreement contemplated by this Agreement and to make any decision pursuant to the authority prescribed in this Agreement, so long as such action is reasonably believed by the General Partner to be in the best interests of the Partnership.29 In Norton v. K-Sea Transp. Partners, L.P., we interpreted language nearly identical to Section 6.10(d), and held that it unconditionally eliminated all common law standards of care and fiduciary duties, and substituted a contractual good faith standard of care—that the General Partner “reasonably believe that its action is in 27 Gotham Partners, L.P., 817 A.2d at 170. 28 DV Realty Advisors LLC v. Policemen’s Annuity and Benefit Fund of Chicago, 75 A.3d 101, 106-07 (Del. 2013) (citations and footnotes omitted); see also El Paso Pipeline GP Co., L.L.C., 2016 WL 7380418, at 6 (“[T]he prevalence of entity-specific provisions in an area of law defined by expansive contractual freedom requires a nuanced analysis and renders deriving ‘general principles’ a cautious enterprise.”). 29 App. to Opening Br. at 280. 18 the best interest of, or not inconsistent with, the best interests of the Partnership.”30 Although the accuracy of this interpretation is the subject of legitimate debate,31 we choose in this case not to upset Norton’s settled interpretation of Section 6.10(d). Thus, we will not reinterpret Section 6.10(d), and instead will replace any standard of care and duty “imposed by this Agreement or under the Delaware Act or any applicable law, rule or regulation” with a contractual good faith standard.32 Article VI of the LPA addresses management and operation of the Partnership’s business. Section 6.3(a), entitled “Restrictions on General Partner’s Authority,” provides that “[t]he General Partner may not, without written approval of the specific act by all of the Limited Partners . . . take any action in contravention of this Agreement . . . .”33 Thus, as a threshold matter when evaluating a proposed transaction under the LPA, the court must determine what 30 67 A.3d 354, 362 (Del. 2013). 31 The Court of Chancery has questioned this Court’s interpretation of Section 6.10(d). Instead of an unconditional waiver of extra-contractual duties, one could interpret the Section to impose “a condition precedent to the effectiveness of the provisions of the LP Agreement that purport to modify, waive, or limit standards of care or duties otherwise imposed by law.” In re Kinder Morgan, Inc. Corp. Reorganization Litig., 2015 WL 4975270, at 5, n. 1 (Del. Ch. Aug. 20, 2015), aff’d sub nom. The Haynes Family Trust v. Kinder Morgan G.P., Inc., 135 A.3d 76, 2016 WL 912184 (Del. Mar. 10, 2016) (TABLE). This is because the language modifying, waiving, or limiting standards of review and duties is effective “so long as” the General Partner “reasonably believed” its decision was in “the best interest of the Partnership.” Id. at 5. If the general partner failed to act in the best interest of the Partnership, a condition precedent to the modification of fiduciary duties failed to occur, and arguably common law fiduciary duties would then apply to the general partner. 32 App. to Opening Br. at 280. 33 Id. at 276. 19 provision controls the transaction, and whether Brinckerhoff has stated a claim that EEP GP has acted in contravention of that provision. The Alberta Clipper transaction is a contract with an Affiliate (Enbridge) to sell property (Alberta Clipper Interest) back to the Partnership (EEP). Section 6.6, entitled “Contracts with Affiliates,” and in particular Section 6.6(e), directly addresses the affirmative obligation EEP GP must satisfy for such transactions: “[n]either the General Partner nor any of its Affiliates shall sell, transfer or convey any property to, or purchase any property from, the Partnership, directly or indirectly, except pursuant to transactions that are fair and reasonable to the Partnership.”34 Even though Section 6.6(e) imposes an affirmative obligation on EEP GP, the Court of Chancery held that Section 6.10(d)’s contractual good faith standard “modifies” Section 6.6(e), and requires Brinckerhoff to first show that EEP GP lacked good faith in approving the transaction.35 We are at a loss to understand how it does. Section 6.6(e) imposes an affirmative obligation on EEP GP when contracting with Affiliates. Section 6.10(d), on the other hand, is a general standard of care that operates in the spaces of the LPA without express standards. 34 Id. at 278. 35 Brinckerhoff IV, 2016 WL 1757283, at 13 (quoting Brinckerhoff I, 2011 WL 4599654, at 4 (“To meet the standard set by . . . Section 6.10(d), Plaintiff must ‘plead facts suggesting that EEP GP’s Board acted in bad faith’ in its determination that the Transaction was ‘fair and reasonable to the Partnership.’”)). 20 Although EEP GP must act in good faith under the LPA, and is not subject to fiduciary standards of care, it still must comply with the specific requirements of the LPA. The Court of Chancery confused the general standard of care under Section 6.10(d) with the LPA’s more specific requirements. It also violated settled rules of contract interpretation, requiring that the court prefer specific provisions over more general ones.36 Similar difficulties occur with the Court of Chancery’s reliance on Section 6.9(a) to engraft a bad faith standard of care onto Section 6.6(e). Section 6.9(a), which addresses ways EEP GP might resolve conflicts of interest, expressly carves out other provisions of the LPA.37 Equally important, Section 6.9(a) is a safe harbor for conflict transactions, such as mergers, that are not controlled by other 36 Gelfman v. Weeded Investors, L.P., 792 A.2d 977, 990 (Del. Ch. 2001) (specific provision governing conflict of interest transactions controlled in lieu of general provision addressing non- conflicted transaction); Sonet v. Timber Co. L.P., 722 A.2d 319, 325 (Del. Ch. 1998) (specific provision in LPA controlled over more general provision). 37 App. to Opening Br. at 279 (“Unless otherwise expressly provided in this Agreement . . . .”); Brinckerhoff v. Tex. E. Prods. Pipeline Co., LLC, 986 A.2d 370, 388-89 (Del. Ch. 2010) (“Section 6.6(e) is an ‘express standard’ [under Section 6.9(b) and] the defendants were required to comply only with Section 6.6(e) and were ‘not . . . subject to any other or different standard imposed by this Agreement . . . .’”); see also Norton, 67 A.3d at 364 (interpreting a section substantially identical to Section 6.6(e) and holding that “[t]his language creates an affirmative obligation—K-Sea GP may not engage in a transaction with the Partnership unless the transaction is ‘fair and reasonable’” compared to the permissive nature of the conflict resolution provision); In re El Paso Pipeline Partners, L.P. Deriv. Litig., 2014 WL 2768782, at 11 (Del. Ch. June 12, 2014) (interpreting a similar conflict resolution provision and noting that the section “has its own introductory phrase—‘[u]nless otherwise expressly provided in this Agreement’— which is itself important, because for certain types of transactions that involve a conflict of interest on the part of the General Partner, the LP Agreement sets forth a separate and even more specific contractual standard.”). 21 specific provisions of the LPA. It does not displace express standards in other provisions of the LPA. The defendants point to the last stand-alone paragraph of Section 6.9(a), and claim that it imposes a bad faith standard on all conflict transactions.38 But as explained previously, Section 6.9(a) is a conflict resolution procedure that EEP GP can use to resolve conflicts not addressed by other LPA provisions. The bad faith limitation in the last paragraph relates only to “the resolution, action or terms so made, taken or provided” by EEP GP to resolve a conflict transaction under Section 6.9(a). Here, the Alberta Clipper transaction is expressly governed by Section 6.6(e). Finally, taking a cue from Brinckerhoff I, the Court of Chancery determined that Sections 6.8(a) (good faith exculpates Indemnitees from monetary damages) and 6.10(b) (conclusive presumption of good faith based on reliance with professional advisors) “enveloped” 6.6(e), requiring Brinckerhoff to plead that the defendants lacked good faith when they approved the Alberta Clipper transaction under Section 6.6(e). The Court of Chancery also relied on a statement in 38 App. to Opening Br. at 279: Nothing contained in this Agreement, however, is intended to nor shall it be construed to require the General Partner to consider the interests of any Person other than the Partnership. In the absence of bad faith by the General Partner, the resolution, action or terms so made, taken or provided by the General Partner with respect to such matter shall not constitute a breach of this Agreement or any other agreement contemplated herein or a breach of any standard of care or duty imposed herein or therein under the Delaware Act or any other law, rule or regulation. 22 Brinckerhoff I that “the Defendants ‘will not be liable to EEP or its [unitholders] for any actions taken in good faith.’”39 Section 6.8(a) exculpates EEP GP and other Indemnitees from monetary damages for actions taken in good faith. But, Section 6.8(a) does not grant EEP GP absolute immunity from suit for any actions taken in good faith. Instead, it only immunizes EEP GP and other Indemnitees from monetary damages. Equitable remedies are still available. The availability of equitable remedies no doubt motivated our Court to issue the remand order in Brinckerhoff II, asking the Court of Chancery to consider the availability of reformation and rescission as remedies for breach of Section 6.6(e) of the LPA.40 And, as will be discussed later, Brinckerhoff has pled viable claims that the defendants acted in bad faith when undertaking the Alberta Clipper transaction. Our interpretation of the Enbridge LPA—Section 6.6(e) is a specific affirmative obligation of EEP GP which is not displaced by other general provisions—is the only one consistent with the overall framework of the LPA.41 It 39 Brinckerhoff IV, 2016 WL 1757283, at 14 (quoting Brinckerhoff I, 2011 WL 4599654, at 9) (emphasis in original); see also Brinckerhoff III, 67 A.3d at 372-73. 40 Brinckerhoff v. Enbridge Energy Co., Inc., No. 574, 2011 (March 27, 2012) (Remand Order). 41 See also Norton, 67 A.3d at 365 (“This interpretation achieves the goal of giving each LPA term an independent meaning. If Section 7.9(a) were construed to impose an affirmative obligation on K-Sea GP, it would be unclear whether Section 7.6(d)’s affirmative obligation relating to transactions between K-Sea GP and K-Sea—which addresses a specific conflict of interest and contains parallel provisions—has any independent meaning or serves any independent purpose.”); see also In re El Paso Pipeline Partners, 2014 WL 2768782, at 11 23 is also consistent with settled contract interpretation principles.42 The defendants’ interpretation would render many of the LPA’s specific requirements a nullity.43 The Court of Chancery erred by finding that Sections 6.8(a), 6.9(a), and 6.10(d) modified the affirmative obligation set forth in Section 6.6(e). Section 6.6(e) and its “fair and reasonable” requirement govern the Alberta Clipper transaction. III. Brinckerhoff alleged that the Alberta Clipper transaction breached three specific provisions of the LPA—Sections 6.6(e) (the Alberta Clipper transaction must be “fair and reasonable” to the Partnership); 5.2(c) (tax conventions, allocations, and amendments cannot have a “material adverse effect on the Partners”); and 15.3(b) (LPA amendments cannot “enlarge the obligations” of any investor without their consent). Although the Court of Chancery did not fully consider the viability of these claims, they were presented to the court and “in the (recognizing that “the LP Agreement establishes a hierarchy of contractual standards ranging from the general to the specific and that in each case the most specific standard applies.”). 42 DCV Holdings, Inc. v. ConAgra, Inc., 889 A.2d 954, 961 (Del. 2005) (“Specific language in a contract controls over general language, and where specific and general provisions conflict, the specific provision ordinarily qualifies the meaning of the general one.”) (internal citations omitted). 43 The good faith precondition would override other express provisions of the LPA. See, e.g., Section 6.3(a) (EEP GP must comply with the specific provisions of the LPA); Section 6.5 (outside activities of the General Partner, covering matters falling under the corporate opportunity doctrine); and Section 6.7 (indemnification of the General Partner and other indemnitees by the Partnership). 24 interest of justice and for the sake of judicial economy, we decide those issues de novo.”44 A. Under Section 6.6(e), “[n]either the General Partner nor any of its Affiliates shall sell, transfer or convey any property to, or purchase any property from, the Partnership, directly or indirectly, except pursuant to transactions that are fair and reasonable to the Partnership.”45 The requirements of 6.6(e) are deemed satisfied, however, “as to any transaction the terms of which are no less favorable to the Partnership than those generally being provided to or available from unrelated third parties.”46 In other words, the fairness and reasonableness of the transaction can be assessed by comparing it to arms-length transactions. Further, the fairness and reasonableness “shall be considered in the context of all similar or related transactions.”47 The fair and reasonable standard is “something similar, if not equivalent to entire fairness review.”48 We find that Brinckerhoff has pled sufficient facts leading to an inference that the Alberta Clipper transaction was not “fair and reasonable to the Partnership” because EEP repurchased assets from Enbridge “less favorable to the 44 Bank of New York Mellon v. Commerzbank Capital Funding Trust II, 65 A.3d 539, 553 (Del. 2013) (internal citations omitted). 45 App. to Opening Br. at 278. 46 Id. 47 Id. at 289. 48 Brinckerhoff II, 2012 WL 1931242, at 2. 25 Partnership than those generally being provided to or available from unrelated third parties.”49 According to Brinckerhoff, EEP paid $200 million more to repurchase the same assets it sold in 2009, despite declining EBITDA, slumping oil prices, and the absence of the expansion rights sold in 2009. He also alleged that, through the Special Tax Allocation, EEP GP added hundreds of millions of dollars more in benefits for Enbridge to the detriment of the public unitholders. These allegations are sufficient to state a claim for breach of the requirements of Section 6.6(e). B. The same cannot be said for Brinckerhoff’s claims that the Special Tax Allocation, which involved the issuance of new Class E Units, breached Sections 5.2(c) and 15.3(b) of the LPA. Section 5.2(c) controls allocations for tax purposes needed “[f]or the proper administration of the Partnership or for the preservation of the uniformity of the Units (or any class or classes thereof) . . . .”50 Such allocations cannot be made if they have “a material adverse effect” on the unitholders.51 Brinckerhoff conceded below that Section 5.2(c) does not apply to the Alberta Clipper transaction because the Special Tax Allocation was not for the proper administration of the partnership or to equalize the tax treatment among 49 App. to Opening Br. at 278. 50 Id. at 270. 51 Id. 26 unitholders.52 He also conceded that the Special Tax Allocation cannot have a material adverse effect on the partners within the meaning of Section 5.2(c).53 Thus, Brinckerhoff has waived the argument that EEP GP breached Section 5.2(c) of the LPA. Section 15.3(b) sets forth the requirements to amend the LPA. It states that, notwithstanding earlier provisions of Section 15 addressing when and how EEP GP can adopt LPA amendments without unitholder approval, “no amendment to this Agreement may (i) enlarge the obligations of any Limited Partner without such Limited Partner’s consent, which may be given or withheld in its sole discretion . . . .”54 Brinckerhoff argues that the Special Tax Allocation, and its potential to generate taxable income to the unitholders, “enlarges the obligations” of the unitholders without their consent. Stated differently, the Special Tax Allocation increases their tax liability to the government without their consent. Essential to Brinckerhoff’s argument is the meaning of “obligations.” Lacking a specific definition in the LPA, we look for its use in other contexts in the LPA to discern its meaning.55 We note first that “obligations” is not used 52 Id. at 668 (Oral Argument Trans.). 53 Id. at 669. 54 Id. at 295. 55 See Kuhn Const., Inc. v. Diamond State Port Corp., 990 A.2d 393, 397 (Del. 2010) (looking to how term was used in other parts of a contract to assess its meaning); Radio Corp. of Am. v. Philadelphia Storage Battery Co., 6 A.2d 329, 334 (Del. 1939) (“[W]ords used in one sense in one part of the contract will ordinarily be considered to have been used in the same sense in another part of the same instrument where the contrary is not indicated.”); In re Mobilactive 27 anywhere in Article IX of the LPA addressing “Tax Matters.” The word does, however, appear in Article VII, entitled “Rights and Obligations of Limited Partners.” In that context, “obligations” plainly means the responsibilities, or more accurately, lack of responsibilities, of the limited partners to the Partnership. Article VII addresses the “limited” nature of the limited partners’ liability under the LPA (Section 7.1); the lack of an obligation to manage the business (Section 7.2); and the lack of an obligation to work exclusively on partnership business (Section 7.3). In the context of Article XIV entitled “Dissolution and Liquidation,” Section 14.8 uses the word “obligations” to eliminate any duty by the limited partners to restore negative balances in their capital account to the Partnership upon liquidation of the Partnership. And finally, “obligations” is used in Sections 5.11, 5.12, and 5.13 addressing the “rights and obligations” of unitholders. When the word “obligations” in Section 15.3(b) is placed in the context of the LPA as a whole, we find that the only reasonable meaning of the word “obligations” in Section 15.3(b) is contractual obligations that the limited partners owe to the Partnership. The Special Tax Allocation might increase the limited partners’ tax liability to the government, but it does not enlarge the limited partners’ obligations to the Partnership. Thus, EEP GP has not breached Section Media, LLC, 2013 WL 297950, at 19 (Del. Ch. Jan. 25, 2013) (interpreting phrase “so as to give it the same meaning throughout the [a]greement”); 28 Richard A. Lord, Williston on Contracts § 32:6 (“Generally, a word used by the parties in one sense will be given the same meaning throughout the contract in the absence of countervailing reasons.”). 28 15.3(b) by potentially allocating additional gross income to the limited partners through the Special Tax Allocation. IV. Having established that Brinckerhoff has pled a viable claim for breach of Section 6.6(e), we turn to possible remedies. If a breach is eventually found, then under Section 6.8(a), EEP GP is exculpated from monetary damages if it acts in good faith. Equitable remedies are not exculpated. We find that Brinckerhoff has pled facts supporting an inference that EEP GP acted in bad faith in approving the Alberta Clipper transaction. A. Absent contractual limitations, if EEP GP breached the LPA, and damages could be established with reasonable certainty, EEP GP would pay monetary damages to the unitholders. Section 6.8(a), however, exculpates EEP GP as an Indemnitee from monetary damages if it acted in good faith: Notwithstanding anything to the contrary set forth in this Agreement, no Indemnitee56 shall be liable for monetary damages to the Partnership, the Limited Partners, the Assignees or any other Persons who have acquired interests in the Units, for losses sustained or 56 App. to Opening Br. at 24: “Indemnitee” means the General Partner, any Departing Partner, any Person who is or was an Affiliate of the General Partner or any Departing Partner, any Person who is or was an officer, director, employee, partner, agent or trustee of the General Partner, any Departing Partner or any such Affiliate, or any Person who is or was serving at the request of the General Partner, any Departing Partner or any such Affiliate as a director, officer, employee, partner, agent or trustee of another Person. 29 liabilities incurred as a result of any act or omission if such Indemnitee acted in good faith.57 The LPA does not define good faith. In Brinckerhoff III, we considered what must be pled to allege bad faith by EEP GP. Relying on Parnes v. Bally Entertainment Corporation, and corporate notions of waste, we held that “[t]o state a claim based on bad faith,” EEP GP’s decision to enter into the Joint Venture Transaction “must be ‘so far beyond the bounds of reasonable judgment that it seems essentially inexplicable on any ground other than bad faith.’”58 On the same day we decided Brinckerhoff III, we also decided Norton, and took a different approach to define bad faith.59 Using essentially the same language of Section 6.10(d) of the Enbridge LPA, the Norton LPA modified any standard of care or duty to permit the general partner to act under the LPA “so long as such action is reasonably believed by [the general partner] to be in, or not inconsistent with, the best interests of the Partnership.”60 57 Id. at 279. 58 Brinckerhoff II, 67 A.3d 369, 372 (Del. 2013) (quoting Parnes, 722 A.2d at 1246 (internal quotation and citation omitted)). 59 67 A.3d 354 (Del. 2013). 60 Id. at 361 (italics omitted). Compare App. to Opening Br. at 280 (any standard of care or duty modified to permit general partner to act under the LPA “so long as such action is reasonably believed by the General Partner to be in the best interests of the Partnership.”). The “best interests of the partnership” are the best interests of the entity, not just the best interests of the limited partners. See In re Kinder Morgan, Inc. Corp. Reorganization Litig., 2015 WL 4975270, at 8 (“[T]he members of the Committee did not have to believe that the MLP Merger was in the best interests of the limited partners. They rather had to believe in good faith that the MLP Merger was in the best interests of the Partnership.”); In re El Paso Pipeline Partners, L.P. Deriv. Litig., 2015 WL 1815846, at 18-19 (Del. Ch. Apr. 20, 2015) (Special Committee’s 30 In Norton, we found that this expression of the standard of care [Section 7.10(d) in Norton, Section 6.10(d) in this case] also supplied the definition of good faith for the stand-alone good faith requirement in the exculpatory provision [Section 7.8(a) in Norton, Section 6.8(a) in this case]: [T]he LPA broadly exculpates all Indemnitees . . . so long as the Indemnitee acted in “good faith.” Although the LPA regrettably does not define “good faith” in this context, we cannot discern a rational distinction between the parties’ adoption of this “good faith” standard and Section 7.10(d)’s contractual fiduciary duty, i.e., an Indemnitee acts in good faith if the Indemnitee reasonably believes that its action is in the best interest of, or at least, not inconsistent with, the best interests of K-Sea. If we take seriously our obligation to construe the agreement’s “overall scheme,” we must conclude that the parties’ insertion of a free-standing, enigmatic standard of “good faith” is consistent with Section 7.10(d)’s conceptualization of a reasonable belief that the action taken is in, or not inconsistent with, the best interests of the Partnership. In this LPA’s overall scheme, “good faith” cannot be construed otherwise.61 We believe the approach taken in Norton interpreting essentially the same exculpatory language is more faithful to the specific language of the Enbridge LPA, and does not rely on extra-contractual notions of waste and a heightened pleading burden to plead bad faith. As in Norton, and consistent with contract interpretation rules,62 we believe good faith was intended to be used consistently throughout the LPA. Thus, we depart from our earlier decision in Brinckerhoff III, determination that transaction would be accretive to the unitholders did not mean that the transaction was in the best interests of the MLP as an entity). 61 Norton, 67 A.3d at 362 (internal citations omitted). 62 See note 55. 31 and hold that to plead a claim that EEP GP did not act in good faith, Brinckerhoff must plead facts supporting an inference that EEP GP did not reasonably believe that the Alberta Clipper transaction was in the best interests of the Partnership. As our prior cases have established, the use of qualifier “reasonably” imposes an objective standard of good faith.63 Here, Brinckerhoff has pled facts supporting an inference that EEP GP did not reasonably believe in good faith that the Alberta Clipper transaction was fair and reasonable to the Partnership. According to the allegations of the complaint, EEP GP and Enbridge Management, through the Director Defendants, knew when approving the transaction that (a) they did not consider the 2009 transaction despite express direction in the LPA that they do so; (b) Enbridge changed its valuation methodology in 2014 when it valued the Alberta Clipper Interest as a multiple of EBITDA, as compared to 2009, when it valued the Alberta Clipper Interest at cost; (c) failed to consider that the Alberta Clipper Interest’s projected next year EBITDA was 20% lower than it was in 2009, although valued 25% higher in 2009; (d) failed to negotiate the purchase price despite the negative oil pricing environment, Enbridge’s control over the volume flowing through the pipeline, and 63 Norton, 67 A.3d at 361, n. 34 (The LPA’s “addition of the term ‘reasonably’ distinguishes it from limited partnership agreements that Delaware courts have interpreted as establishing a purely subjective standard.”); see also DV Realty Advisors LLC, 75 A.3d at 110, n. 18 (distinguishing from Norton and applying a subjective good faith standard because the LPA at issue did not require a “reasonable belief.”). 32 shorter tariff agreements; (e) failed to value the Special Tax Allocation benefits to Enbridge, and the financial detriment to the unaffiliated unitholders; (f) failed to take into consideration the lack of expansion rights sold in 2009; and (g) relied on a purportedly flawed financial opinion. At the pleading stage of this case, we find that EEP GP cannot rely on Section 6.8(a) to exculpate it from monetary damages. B. EEP GP nonetheless claims it is entitled to a conclusive presumption of good faith by relying on Simmons’ fairness opinion that the Alberta Clipper transaction “is fair to Partners and to the holders of Partners’ common units (other than [Enbridge] and its affiliates) from a financial point of view.”64 Using similar language to that of 8 Del. C. § 141(e),65 Section 6.10(b) of the LPA provides EEP GP with a conclusive presumption of good faith under certain conditions: The General Partner may consult with legal counsel, accountants, appraisers, management consultants, investment bankers and other consultants and advisors selected by it, and any act taken or omitted in reliance upon the opinion (including, without limitation, an Opinion of Counsel) of such Persons as to matters that the General Partner reasonably believes to be within such Person’s professional or expert 64 App. to Opening Br. at 306-07. 65 8 Del. C. § 141(e) (emphasis added): A member of the board of directors, or a member of any committee designated by the board of directors, shall, in the performance of such member’s duties, be fully protected in relying in good faith upon . . . any other person as to matters the member reasonably believes are within such other person’s professional or expert competence and who has been selected with reasonable care by or on behalf of the corporation. 33 competence shall be conclusively presumed to have been done or omitted in good faith and in accordance with such opinion.66 For several reasons, EEP GP has fallen short of making a dispositive, pleading- stage showing that it is entitled to invoke the conclusive presumption of good faith. By its own terms, Section 6.10(b) requires that EEP GP “reasonably believe” that Simmons was professionally equipped to opine on the fairness and reasonableness of the Alberta Clipper transaction in a manner consistent with the requirements of Section 6.6(e). In this case, whether EEP GP could have reasonably believed Simmons was an appropriate advisor depends on the factual record developed through discovery. For present purposes, we must accept as true Brinckerhoff’s allegation that EEP GP could not have reasonably relied on a banker that did not consider what Brinckerhoff has alleged to be the most relevant precedent transaction when it was acting under a standard that expressly required consideration of comparable transactions—the 2009 Alberta Clipper transaction. Further, as is the case with Section 141(e) of the Delaware General Corporation Law and as contemplated by Section 6.10(b) of the LPA, qualified advisors are often called upon to provide accounting, tax, and financial advice to the general partner in pursuit of the entity’s business. For instance, transaction and tax counsel will often advise the board members on transaction structure. Financial advisors will often advise the board on valuation issues. In those situations, the advice 66 App. to Opening Br. at 280. 34 established the appropriate methods and terms on which the general partner then acts to consummate a transaction.67 If Simmons had been charged in the first instance to value the Alberta Clipper Interest, and the Special Committee had reasonably relied on Simmons’ valuation to set the sale price, Simmons’ role and the Special Committee’s reliance on its valuation might be a more comfortable fit with the reliance language of Section 6.10(b). Instead, according to the complaint’s allegations, the financial terms were fully baked by the time Simmons appeared on the scene to render a fairness opinion.68 Thus, on the record before us, EEP GP did not rely on Simmons in the manner contemplated by Section 6.10(b), and is not entitled to a conclusive presumption of good faith for the Alberta Clipper transaction. C. Defendants next argue, and the Court of Chancery agreed, that reformation and rescission were unavailable as remedies for breach of the LPA, because 67 See generally Edward P. Welch et al., Folk on the Delaware General Corporation Law § 141.12 (2016) (citing In re Formica Corp. Shareholders Litig., 1989 WL 2581 (Del. Ch. March 22, 1989) (special committee entitled to rely on valuation advice of its investment banker)); In re Cheyenne Software, Inc. S’holders Litig., 1996 WL 652765 (Del. Ch. Nov. 7, 1996) (board entitled to rely on investment banker’s opinion in considering a tender offer). See also In re Walt Disney Co. Deriv. Litig., 907 A.2d 693, 770 (Del. Ch. 2005), aff’d, 906 A.2d 27 (Del. 2006) (committee’s reliance on expert’s analysis protected under § 141(e)); Cinerama, Inc. v. Technicolor, Inc., 663 A.2d 1134, 1142 (Del. Ch. 1994), aff’d, 663 A.2d 1156 (Del. 1995) (board relied in good faith on advice of experienced counsel relevant to overall fairness of the process). 68 See App. to Opening Br. at 83 (Simmons Presentation) (“Valuation had been pre-announced via press-release, with a proposed total transaction value of $916 million . . . subsequently raised 2015 EBITDA forecast to $93 million and transaction value to $1 billion . . . Simmons has been engaged to provide a fairness opinion . . . .”). 35 Brinckerhoff was not excused “from supporting his claims for reformation or rescission with well-pled facts that meet the requisite elements of these remedies.”69 We conclude, however, that the Court of Chancery viewed its remedial authority too narrowly. The LPA eliminated monetary damages if EEP GP acted in good faith. It did not, however, limit equitable remedies. In the earlier appeal in Brinckerhoff III, we remanded to the Court of Chancery before the final decision to determine the sufficiency of Brinckerhoff’s claims for reformation and rescission. Following remand, the court believed reformation was a possible remedy for breach of the LPA.70 We agree with that conclusion. Once liability has been found, and the court’s powers shift to the appropriate remedy, the Court of Chancery has broad discretion to craft a remedy to address the wrong.71 EEP GP faces potential liability for breach of Section 6.6(e), under a contractual fiduciary standard similar if not identical to entire fairness. As we held in Gotham Partners, L.P. v. Hallwood Realty Partners, L.P., such contractual standards can subject the general partner to equitable relief: 69 Brinckerhoff IV, 2016 WL 1757283, at 19. 70 Brinckerhoff II, 2012 WL 1931242, at 2. 71 Int’l Telecharge, Inc. v. Bomarko, Inc., 766 A.2d 437, 439 (Del. 2000) (noting that the Delaware Supreme Court “defer[s] substantially to the discretion of the trial court in determining the proper remedy”); Weinberger v. UOP, Inc., 457 A.2d 701, 715 (Del. 1983) (noting “the broad discretion of the Chancellor to fashion such relief as the facts of a given case may dictate”). 36 The Partnership Agreement provides for contractual fiduciary duties of entire fairness. Although the contract could have limited the damage remedy for breach of these duties to contract damages, it did not do so. The Court of Chancery is not precluded from awarding equitable relief as provided by the entire fairness standard where, as here, the general partner breached its contractually created fiduciary duty to meet the entire fairness standard and the partnership agreement is silent regarding damages.72 At this stage in the proceedings, Brinckerhoff will not be limited to a specific equitable remedy. Whether an equitable remedy should be ordered will depend on the Vice Chancellor’s assessment of the equities, which include the practicality of an equitable remedy given the passage of time, and the ability to order equitable relief tailored to the harm caused by a breach of the LPA. V. Finally, Brinckerhoff argues that the Court of Chancery erred in dismissing his claims against Enbridge and the Remaining Defendants for breach of residual fiduciary duties, aiding and abetting breach of contract, and tortious interference with the LPA. Because the secondary liability claims raise interesting issues that would benefit from a more fully developed record, we will await the Court of Chancery’s determination of these issues. VI. Because we have determined that Brinckerhoff has pled a viable claim for breach of the express terms of the LPA, we reverse the Court of Chancery’s April 72 817 A.2d 160, 175 (Del. 2002). 37 29, 2016 decision and remand the matter for further proceedings consistent with this Opinion. It is further ordered that the time within which a motion for reargument may be timely filed under Supreme Court Rule 18 is shortened to five days from the date of this Opinion. 38	{ "pile_set_name": "FreeLaw" }
949 So.2d 52 (2006) McBRIDE CONSULTING SERVICE, LLC, Stuart McBride and Cindy K. McBride, Appellants v. WASTE MANAGEMENT OF MISSISSIPPI, INC. and Waste Management, Inc., Appellees. No. 2003-CA-02805-COA. Court of Appeals of Mississippi. May 16, 2006. Rehearing Denied November 14, 2006. 53 J. Douglas Minor, J. Brad Pigott, Jackson, for Appellants. Robert Eric Pfeffer, Fred L. Banks, E. Clifton Hodge, Luther T. Munford, James W. Shelson, Jackson, for Appellees. Before KING, C.J., IRVING and BARNES, JJ. KING, C.J., for the Court. ¶ 1. At the close of plaintiffs' case-in-chief, the trial court granted the motions of the defendants for a directed verdict. Aggrieved by this action, and the trial court's pretrial dismissal of the individual claims of Cindy McBride, the McBrides 54 have appealed and raised the following issues, which we state verbatim: 1. Liability for either of the "Intentional Interference" Torts turns entirely on the inherently factual issue of a defendant's intent to cause harm; 2. The Plaintiffs offered at trial substantial direct and circumstantial evidence that the Defendants authorized sales executive acted to "take away" the Plaintiffs' clients and to "go after" the Plaintiffs with "whatever it takes" and otherwise with an intent to cause the plaintiffs harm; 3. The trial court committed error by forbidding a jury from considering evidence of the intent of the defendants' executive toward the plaintiffs; 4. The trial court committed error in ruling that liability for intentional interference with contractual relations requires that the defendant's conduct caused a breach (as opposed to at will termination) of the plaintiff's contracts with a third party; 5. The trial court committed error in excluding testimony about a conversation between two Waste Management executives admitting that Waste Management's actions toward the McBrides had "A potential for blowing up on us" in court; 6. The trial court committed error in excluding testimony about the timing of David Myhan's profane statements about his intentions to "get" Stuart McBride and to "take his work no matter what I have to do"; 7. The trial court committed error in granting partial summary judgement against Cindy McBride as to her individual claims. Finding no error, we affirm. FACTS ¶ 2. The McBrides had worked for many years in the waste disposal industry. In the mid-1990s, they used that experience to establish McBride Consulting Service, L.L.C. McBride Consulting is a waste broker. As a waste broker, McBride enters at will contracts with small businesses to serve as their exclusive agent for the negotiation of waste disposal contracts. McBride then negotiates with a third party waste disposal company a collective price for the waste disposal of its clients, and serves as paying agent for its clients. McBride makes its money from the cost savings obtained for its clients by this collective negotiation. ¶ 3. Waste Management is a third party waste disposer with whom McBride negotiated waste disposal for its clients. The collective price obtained from Waste Management by McBride was generally lower than which was then available to the individual businesses. However, because McBride did let its bids based upon volume, the cost to an individual client of McBride may or may not have been lessened. ¶ 4. McBride worked aggressively to grow its business. This included making contacts with businesses for whom Waste Management was already the contracted waste disposer. When McBride was employed to serve as the broker for a business, it gave the client a form letter to send to Waste Management. This letter directed that contract discussions be conducted through McBride, and also stated that where allowed, notice of the termination of the existing contract was being given. With the termination or expiration 55 of these contracts, McBride would put them out for bid. ¶ 5. Recognizing that waste brokers were a growing group, Waste Management adopted a national policy which required that (1) the rates to be charged to waste brokers be established by the regional office, (2) these rates be in upper tiers of the rate scales, and (3) the waste brokers sign a standard contract. The policy mandated that if a broker declined to execute the standard contract, then Waste Management would not do business with him. McBride refused to execute the standard contract, indicating that it routinely disposed of them without a through reading. ¶ 6. At some point in the process, Waste Management became concerned that its relationship with McBride was less than satisfactory. Among the concerns expressed by Waste Management were(1) the refusal of McBride to sign the standard contract and (2) its perception that McBride was tardy in the payment of the invoices sent to it. To address these concerns, Waste Management undertook a series of aggressive actions, including offering to individual businesses lower prices than those prices which it was willing to give to McBride. Waste Management made clear that these lower rates were only available to customers who dealt directly with it. As a result of the lower rates offered directly by Waste Management, a number of McBride's clients chose to contract directly with Waste Management rather than have their needs brokered by McBride. ¶ 7. McBride filed suit against Waste Management for (1) intentional interference with a contractual relations and (2) intentional interference with business relationships. At the conclusion of McBride's case-in-chief, the trial court, finding insufficient evidence to submit the matter to the jury, entered judgment for the defendants. ¶ 8. The trial court found that McBride had proven an interference with its business by Waste Management. However, it held that interference to have been privileged rather than tortious. The trial court found that the interference was at least in part motivated by business competition, and therefore McBride had failed to establish that it was done for an unlawful or improper reason. ¶ 9. Cindy McBride had also included a personal claim for emotional distress, which the trial court dismissed prior to trial. The trial court indicated that any claims which Cindy McBride had fell within the scope of the corporate claims and could not be pursued by her individually. DISCUSSION OF THE ISSUES Directed Verdict ¶ 10. This Court reviews de novo the granting of a directed verdict. In doing so, we consider the evidence in the light most favorable to the party against whom the directed verdict has been granted. Partain v. Sta-Home Health Agency of Jackson, Inc., 904 So.2d 1112, 1116(¶ 7) (Miss.Ct.App.2004). We may only sustain the granting of a directed verdict where the evidence as a matter of law is insufficient to establish even a prima facie right of recovery. Id. ¶ 11. Tortious interference with contract occurs when one causes another to breach a contract with a third person. Par Industries, Inc. v. Target Container Co., 708 So.2d 44, 48(¶ 8) (Miss.1998). Tortious interference with business relations, on the other hand, occurs when one unlawfully diverts prospective customers away from another's business. Id. at (¶ 10). With both torts, the plaintiff must prove (1) the offending acts were intentional 56 and willful, (2) the acts were calculated to cause damage to the plaintiffs in their lawful business, (3) the acts were done with the unlawful purpose of causing damage and loss, without right or justifiable cause on the part of the defendant (which constitutes malice), and (4) actual damage and loss resulted. Scruggs, Millette, Bozeman & Dent, P.A. v. Merkel & Cocke, P.A., 910 So.2d 1093, 1098(¶ 23) (Miss. 2005); MBF Corp. v. Century Business Communications, Inc., 663 So.2d 595, 598 (Miss.1995). Additionally, in the case of tortious interference with business relations, in order to establish a prima facie case for damages, the plaintiff must prove (1) that his business experienced a loss, and (2) that the defendant was the cause of that loss. Par Industries, 708 So.2d 44 at 48(¶ 10). ¶ 12. Since a directed verdict is appropriate where an essential element of the plaintiff's cause is lacking, we will focus on whether Waste Management's actions were done with the unlawful purpose of causing damage and loss, without right or justifiable cause. The McBride evidence, if accepted by the finder of fact, established that the aggressive marketing by Waste Management offering substantially lower rates, including at or below cost, to prospective customers, had a direct financial impact upon the earnings potential of McBride. However, several Mississippi cases that discuss the closely intertwined torts have considered whether the defendant displayed "bad acts exceeding the realm of legitimate competition" and whether the defendant's acts were committed without legal or social justification. MBF Corp., 663 So.2d at 599; Par Industries, 708 So.2d at 48. ¶ 13. The aggressive marketing of a company's products or services, of necessity, is intended to impact the business of competitors by the increase in its market share and the decrease in the earnings potential of those others operating in the same sphere. Such actions in and of themselves are lawful, and without more, do not give rise to a cause of action. ¶ 14. The primary indication that Waste Management may have acted improperly is found in its documents, Exhibit 9, the Internet Price Model, which suggested that it was charging less to collect waste in some locations than its computer model indicated as the minimum cost of collection. The underpricing of goods or services is not unlawful, unless it has the effect of restraining free trade. Owens Corning v. R.J. Reynolds Tobacco Co., 868 So.2d 331, 344(¶ 32) (Miss.2004). There is no proof in the record that the actions of Waste Management had the effect of restraining trade. There were other waste disposal companies with whom McBride continued to contract. This fact is established in the testimony of Cindy McBride, who stated that in 2002 McBride lost seven customers to Waste Management, while moving over fifty customers from Waste Management to another waste hauler. ¶ 15. The evidence in the record indicates that Waste Management, having suffered the loss of a number of customers, aggressively marketed its services to its existing accounts, who had contracts with McBride. As a part of this aggressive marketing process, Waste Management offered these accounts rates substantially below those which they were able to receive by contracting with McBride to serve as their broker. In doing so, Waste Management made clear that these rates were only available under a direct contract, rather than brokered contracts. The results of this aggressive marketing is seen in the notation, "Took away from broker, but also needed to roll back price in order to keep," found on several Waste Management *57 documents related to customer accounts. ¶ 16. There was evidence presented from which it might be concluded that some contracts between McBride and its clients were terminated because Waste Management offered lower rates to these businesses. These were rates which Waste Management refused to extend to McBride. Waste Management says that its efforts were justified and legal because they were intended to keep its customers and increase its revenues. The effort to increase profitability, without more is not improper. However, the effort may be conducted under circumstances which render it improper, and therefore actionable. Cenac v. Murry, 609 So.2d 1257, 1269 (Miss.1992) (citing Wesley v. Native Lumber Co., 97 Miss. 814, 820, 53 So. 346, 347 (1910)). Likewise, the refusal of Waste Management to extend to a waste broker the same or lesser rates than those given to direct customers is not per se improper. Wertz v. Ingalls Shipbuilding, Inc., 790 So.2d 841, 848(¶ 27) (Miss.Ct.App.2000) (citing Restatement (Second) of Torts § 766 (1977)). Nor has McBride produced evidence of actions by Waste Management which were unlawful. Without proof of some improper action by Waste management, McBride's claim must fail. ¶ 17. The record before this Court indicates that both McBride and Waste Management were very aggressive in the pursuit of business, and may even be described as playing hardball. However, that is not illegal. ¶ 18. This Court finds that the directed verdict was appropriate under the facts of this case. Having found the directed verdict to be appropriate, this Court will not address the remaining issues. ¶ 19. THE JUDGMENT OF THE HINDS COUNTY CIRCUIT COURT IS AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO APPELLANTS. LEE AND MYERS, P.JJ., SOUTHWICK, IRVING, CHANDLER, BARNES, ISHEE AND ROBERTS, JJ., CONCUR. GRIFFIS, J., CONCURS IN RESULT ONLY WITHOUT SEPARATE WRITTEN OPINION.	{ "pile_set_name": "FreeLaw" }
806 F.Supp. 259 (1992) RENTCLUB, INC., a Florida corporation, Plaintiff, v. TRANSAMERICA RENTAL FINANCE CORPORATION, a Delaware corporation, Defendant. TRANSAMERICA RENTAL FINANCE CORPORATION, a Delaware corporation, Counter-Plaintiff v. RENTCLUB, INC., a Florida corporation; Michael H. McCaskey and Maria M. McCaskey, Counter-Defendants. No. 90-1452-CIV-T-17A. United States District Court, M.D. Florida, Tampa Division. November 10, 1992. 260 David M. Snyder, Trenam, Simmons, Kemker, Scharf, Barkin, Frye & O'Neill, P.A., Tampa, Fla., Marion Hale, Johnson, Blakely, Pope, Bokor, Ruppel & Burns, P.A., Clearwater, Fla., for plaintiff. Mark A. Levine, Dennis Michael Campbell, Mershon, Sawyer, Johnston, Dunwody & Cole, Miami, Fla., for defendant. ORDER KOVACHEVICH, District Judge. This cause is before the Court on the motion of Counter-defendants Michael H. McCaskey and Maria M. McCaskey to amend the order dated June 30, 1992, 1992 WL 161059, disqualifying Trenam, Simmons, Kemker, Sharf, Barkin, Frye, & O'Neill (Trenam, Simmons) from further participation in this litigation. The motion requests amendment of the order to certify four questions of law for interlocutory review pursuant to 28 U.S.C. § 1292(b). The Final Order Doctrine limits the jurisdiction of federal appellate courts to appeals from all final decisions of the district courts. 28 U.S.C. § 1291. One exception to the Final Order Doctrine is set forth 28 U.S.C. § 1292(b). This provision allows a district court to certify for immediate appeal [A]n order not otherwise appealable under this section ... when the court is of the opinion that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation. By bringing its motion exclusively under § 1292(b), Counter-defendants have apparently assumed that this Court's order to disqualify counsel is not a final order for purposes of appeal. In making this assumption they fail to recognize the clear law of this circuit. In the Eleventh Circuit a district court order disqualifying counsel is a final order immediately appealable under 28 U.S.C. § 1291. United States v. Hobson, 672 F.2d 825, 826 (11th Cir.1982); Norton v. Tallahassee Memorial Hospital, 689 F.2d 938, 941 (11th Cir.1982); see also 51 A.L.R.Fed. 678. Appeal of this order should properly go forward as appeal of a final order under § 1291. It is thus apparent that the Counter-defendants have improperly moved this court for interlocutory certification of an immediately appealable final order to disqualify counsel. In so doing, Counter-defendants have failed to follow the proper procedure for taking appeal of a final order. Under the Federal Rules of Appellate Procedure, an appeal as of right of a final order of a district court shall be taken by filing notice of appeal with the clerk of the district court. Rule 3(a), Fed.R.App.P. The notice of appeal must be filed within thirty days of the entry of the order appealed from. Rule 4(a)(1), Fed.R.App.P. The order to disqualify counsel was dated June 30, 1992. Clearly, the thirty day time period for filing notice of appeal has lapsed. A district court may, upon showing of excusable neglect or good cause, extend the period for filing notice of appeal. However, such an extension of time may only be granted upon motion filed not later than thirty days after the expiration of the time prescribed for filing notice of appeal. Rule 4(a)(5), Fed.R.App.P. No such motion has been filed by Counter-defendants, and the time period in which this Court could hear such a motion has lapsed. This Court is aware of no authority by which an immediately appealable final order may be certified for interlocutory appeal after the time periods for filing notice of appeal and for filing a motion for extension of time have lapsed. Furthermore, 261 Counter-defendants have made no arguments in support of this Court taking such action. Accordingly, it is ORDERED that Counter-defendants' motion to amend June 30, 1992 order disqualifying counsel to certify questions under 28 U.S.C. § 1292(b) be denied. DONE AND ORDERED.	{ "pile_set_name": "FreeLaw" }
Order Michigan Supreme Court Lansing, Michigan December 28, 2011 Robert P. Young, Jr., Chief Justice 143774 Michael F. Cavanagh Marilyn Kelly Stephen J. Markman Diane M. Hathaway Mary Beth Kelly PEOPLE OF THE STATE OF MICHIGAN, Brian K. Zahra, Plaintiff-Appellee, Justices v SC: 143774 COA: 293486 Genesee CC: 08-022038-FC DANA SHAWN SEBASTIAN, Defendant-Appellant. _________________________________________/ On order of the Court, the application for leave to appeal the August 11, 2011 judgment of the Court of Appeals is considered, and it is DENIED, because we are not persuaded that the questions presented should be reviewed by this Court. I, Corbin R. Davis, Clerk of the Michigan Supreme Court, certify that the foregoing is a true and complete copy of the order entered at the direction of the Court. December 28, 2011 _________________________________________ t1219 Clerk	{ "pile_set_name": "FreeLaw" }
843 F.2d 1335 11 Fed.R.Serv.3d 48 Lucious WILLIAMS, Jr., et al., Plaintiffs-Appellees,v.Earl BUTZ, et al., Defendants-Appellants. No. 87-8094. United States Court of Appeals,Eleventh Circuit. May 3, 1988. Kenneth C. Etheridge, Asst. U.S. Atty., Savannah, Ga., Jeffrey Clair, Alfred Mollin, Robert S. Greenspan, Dept. of Justice, Washington, D.C., for defendants-appellants. Kay Y. Young, Georgia Legal Services Program, Atlanta, Ga., for plaintiffs-appellees. Appeal from the United States District Court of the Southern District of Georgia. Before RONEY, Chief Judge, HATCHETT, Circuit Judge, and HAND,* Chief District Judge. RONEY, Chief Judge: 1 The Farmers Home Administration (FmHA) appeals the denial of its motion to modify a consent decree which required it to use only judicial proceedings to foreclose mortgages on homes purchased under the Rural Housing loan program of Section 502(a), Title V of the Housing Act of 1949, 42 U.S.C.A. Sec. 1472 et seq. (1980) (the Act). In view of changes in the agency's regulations, which it contends corrected the due process default which led to the consent decree, the agency sought a court ordered modification to permit foreclosure proceedings under the new regulations. Without examining the new regulations, the district court denied relief on the ground that the parties to the consent decree had agreed that modification would be appropriate only in the event that the consent decree was rendered illegal by subsequent court decisions. The court held that the FmHA neither submitted evidence that the decree violated constitutional, statutory or decisional law, which would render it invalid, nor showed "the kind of extreme, unexpected oppression and hardship which would justify modification of the Court's decree." Because the district court applied the wrong legal principles in refusing to review the proposed modification, we vacate and remand. 2 This is the latest case in a series that have challenged FmHA foreclosure procedures. See Curry v. Block, 738 F.2d 1556 (11th Cir.1984); Johnson v. U.S. Dept. of Agriculture, 734 F.2d 774 (11th Cir.1984). In 1977, FmHA entered into a consent decree with a class of Georgia residents, represented by Lucious Williams, Jr., who have purchased or will purchase homes under the Act and whose mortgages are or will be held by FmHA. The decree provides that when "foreclosure is still recommended by the United States, it will be processed judicially, and each class member will have the opportunity to raise any legal or equitable defense, including the affirmative defense of their claim to moratorium or interest credit." The decree also requires that borrowers be made aware of the availability of relief such as moratorium or interest credit at pre-loan interviews, loan closings and after a missed payment. The agency consented to be restricted to judicial foreclosure proceedings after the borrowers complained that nonjudicial methods authorized under Georgia law violated their right to procedural due process. 3 Congress has since amended the Act, requiring the FmHA to issue regulations giving Section 502 borrowers a right to notice and an impartial administrative hearing before foreclosure. 42 U.S.C.A. Sec. 1480(g). The regulations were promulgated in 1978, and amended several times, most recently in 1985. The 1978 regulations were challenged by a class of Alabama citizens. 4 While not deciding the validity of the regulations, this Court in Johnson v. U.S. Dept. of Agriculture, 734 F.2d 774 (11th Cir.1984), ordered a preliminary injunction requiring only judicial foreclosures until the challenge to nonjudicial foreclosures was decided. There was never a judicial determination concerning the validity of nonjudicial foreclosures under the amended regulations in Johnson, because that case was subsequently settled by a consent decree permitting the FmHA to "use nonjudicial foreclosure in Alabama for all Rural Housing borrowers whose accounts are accelerated on or after July 8, 1985." 5 The Court in Johnson questioned why the FmHA had not requested modification of the Williams decree in light of the regulatory changes that had occurred since the entry of that decree. In September 1986, following the conclusion of the Johnson litigation and the promulgation of the revisions to the FmHA's appeal regulations, the FmHA filed a motion to modify the Williams consent decree, asserting that it was filed in response to this Court's comments in Johnson. 6 Pursuant to Paragraph 8 of the consent decree, the district court had retained jurisdiction "for the sole purpose of entertaining a motion to modify this order on the grounds that it, or any part of it, is in direct conflict with a specific holding of the United States Supreme Court, the Fifth Circuit, or its successor rendered subsequent to the date of this Order." In our judgment, the district court too narrowly limited its authority to amend the prospective effect of the decree only upon a judicial decision that directly conflicted with it or upon a showing of hardship by the agency. 7 Without regard to the terms of the decree, a court acting in equity has inherent power to modify the prospective effect of its decree in response to changed circumstances. See System Federation No. 91 v. Wright, 364 U.S. 642, 646-47, 81 S.Ct. 368, 371, 5 L.Ed.2d 349 (1961); United States v. Swift & Co., 286 U.S. 106, 114, 52 S.Ct. 460, 462, 76 L.Ed. 999 (1932); Roberts v. St. Regis Paper Co., 653 F.2d 166, 172 (5th Cir.1981 Unit B). See also Fed.R.Civ.P. 60(b)(5) (court can modify a judgment when it is no longer equitable that the judgment should have prospective application). That a consent decree is contractual in nature does not relinquish a court's power to revise it in the future. Swift & Co., 286 U.S. 106, 52 S.Ct. 460; System Federation No. 91, 369 U.S. 642, 81 S.Ct. 368. 8 The district court's reaction to the requested modification might well be correct as it might change procedures that would apply to mortgages negotiated prior to the amendments. The Government might not be able to in effect unilaterally change procedures concerning existing mortgages controlled by the consent decree. Two classes of mortgagors are not in the same situation, however: those with mortgages executed after the change in regulations, but before any modification in the consent decree; and those future mortgagors who will purchase homes financed under Section 502(a) of the National Housing Act of 1949 and whose mortgages will be held by FmHA. 9 The district court's refusal to consider modification of the requirements as to prospective application raises serious constitutional questions about the ability of a Government official to bargain away the discretionary duties vested in his office that sound rules of construction dictate be avoided if fairly possible. Although the decree expressly mentions only judicial decisions as furnishing a base for modification, it should be read to be a more general reference to changes in the legal status of nonjudicial foreclosure, a reading that is both plausible and consistent with the interests brought to the negotiations by both parties. 10 The power to modify, however, may only be exercised under the appropriate circumstances. The district court, relying on Roberts v. St. Regis Paper Co., 653 F.2d 166, 174 (5th Cir. Unit B 1981), refused to review the proposed modification because the Government failed to show extreme, unexpected hardship and oppression. See generally Swift & Co., 286 U.S. at 119, 52 S.Ct. at 464, 76 L.Ed. 999. 11 Swift concerned a consent decree entered in 1920 ordering a measure of divestiture by and imposing a variety of restraints upon defendant meat packers. The Supreme Court concluded that the danger of monopoly and elimination of competition which led to the initial Government complaint and the decree had not been removed and there was still a danger of unlawful restraints of trade. The Court held that "nothing less than a clear showing of grievous wrong evoked by new and unforeseen conditions" would lead it to change the decree. Swift, 286 U.S. at 119, 52 S.Ct. at 464. Despite this strong language, the Supreme Court later recognized that Swift 's language must read in context. "Swift teaches that a decree may be changed upon an appropriate showing, and it holds that it may not be changed in the interests of the defendants if the purposes of the litigation as incorporated in the decree ... have not been fully achieved." United States v. United Shoe Machinery Corp., 391 U.S. 244, 248, 88 S.Ct. 1496, 1499, 20 L.Ed.2d 562 (1968). 12 Thus, the job of a district court after Swift and United Shoe is to look at the particular facts and circumstances of the case to determine whether the modification satisfies the underlying purpose of the decree. The purpose of the initial action was to obtain for borrowers under the Act constitutional procedural due process in foreclosure proceedings. This was the purpose of the consent decree. See Goldberg v. Kelly, 397 U.S. 254, 90 S.Ct. 1011, 25 L.Ed.2d 287 (1970). 13 Once having learned from judicial decisions that its Act and Regulations are not consistent with constitutional due process, there is no rational reason why Congress and an agency have to follow the precise procedures established by a consent decree or a judicial decision. If a new statute and new regulations comport with constitutional due process, the Government should be permitted, at least prospectively, to act thereunder. A district court is free to modify the terms of a consent decree when a change in the law brings those terms in conflict with statutory objectives. System Federation No. 91, 364 U.S. at 651, 81 S.Ct. at 373. A change in relevant statutory law--such as in this case where Congress required that the FmHA ensure by regulation that due process rights are afforded to borrowers and regulations are promulgated in compliance with that mandate--is a fully adequate basis upon which modification to a consent decree may be based. 14 This case closely parallels System Federation No. 91, in which the defendant railroad company agreed in a consent decree not to operate "union shops," that is, workplaces in which persons not members of unions would be either excluded or subject to other forms of discrimination. Subsequent to the decree's entry, the Railway Labor Act was amended to permit railroads to negotiate with unions to establish union shops. The railroad moved for modification of the consent decree. The district court denied the motion, noting that the amended act "did no more than make negotiations for a union shop permissive ... [but] did not prohibit an agreement ... [that] a union shop should not exist." 364 U.S. at 646, 81 S.Ct. at 370. The Sixth Circuit affirmed, and the Supreme Court reversed. The Court noted that "to continue [the decree] after the 1951 amendment would be to render protection in no way authorized by the needs of safeguarding statutory rights at the expense of a privilege denied and deniable to no other union." Id. at 648, 81 S.Ct. at 371-72. The Court emphasized that the change in the Railway Labor Act brought the decree in conflict with the statutory objectives, not in that the Act nullified the decree, but in that the decree prohibited a choice that Congress intended that unions and railroads should possess. 15 Here the congressional enactment that mandated the establishment of an administrative appeals procedure for the explicit purpose of solving serious due process deficiencies does not conflict with the underlying purpose of the consent decree. Amending the Housing Act so as to resolve due process problems on the administrative level demonstrates that Congress intended to allow the FmHA to continue to employ, in its discretion and with proper regulations, nonjudicial foreclosure proceedings. The prospective effect of the decree conflicts with the Housing Act by depriving the FmHA of a choice that Congress intended it should be able to exercise. Thus here, as in System Federation No. 91, the parties have no power to continue to insist upon the protection of their rights in a manner different from that chosen by Congress absent constitutional fault. Accordingly, if the FmHA's regulations have properly implemented the command of the statute and comport with constitutional due process, a question for the district court on remand, then the decree should be either vacated or modified so as to permit the FmHA to employ nonjudicial foreclosure proceedings in Georgia. 16 VACATED and REMANDED. * Honorable William Brevard Hand, Chief U.S. District Judge for the Southern District of Alabama, sitting by designation	{ "pile_set_name": "FreeLaw" }
68 Cal.App.2d 360 (1945) In re WILLIAM CONNELL, on Habeas Corpus. Crim. No. 1897. California Court of Appeals. Third Dist. Mar. 12, 1945. William Connell, in pro. per., and S.W. Green for Petitioner. Robert W. Kenny, Attorney General, and Arthur A. Ohnimus and James O. Reavis, Deputies Attorney General, for Respondent. ADAMS, P. J. Petitioner alleges that he is now unlawfully imprisoned, confined and restrained of his liberty by the warden of the penitentiary at Folsom, in that he has served, with the benefit of credits earned and granted, the maximum 361 term of imprisonment provided by law for the offense with which he was charged, and that the judgment and commitment under which he is held are void upon the face thereof. He further alleges and the record shows that in an information filed in Los Angeles County in 1935 he was charged with burglary and two prior convictions of felony, one of the priors being denominated "auto theft" committed in Utah. Defendant pleaded guilty to the information as filed, admitting the two priors, and the court, after finding the burglary to be of the second degree, found him to be an habitual criminal and sentenced him to life imprisonment with the possibility of parole. He was received at the state prison on April 10, 1935. The record before us shows, and it is conceded by respondent, that the prior offense referred to as "auto theft" was charged in the information filed in Utah not as "auto theft" but as "the crime of Depriving an Owner of his Automobile in violation of section 3974X7, Chapter 81, Session Laws, 1921, committed as follows, to wit:" "That the said William Connell alias William Taufer on the 26th day of September,.D. 1931, at the County of Salt Lake, State of Utah, did wilfully, unlawfully and feloniously deprive Mrs. H. B. Carlisle of one Packard Coupe of the serial #U44733 by taking possession and driving away from the possession of the said Mrs. H. B. Carlisle, said automobile which was standing on a public street of Salt Lake City, Salt Lake County, State of Utah, to-wit, on the street in front of 135 east 2nd South, which automobile was then and there the property of and in the possession of the said Mrs. H. B. Carlisle." The Utah statute above mentioned was a portion of an act entitled "Motor Vehicles, Garages, etc.," and, at the time of the commission of the alleged offense, read: "Felony to take vehicle without permit--temporarily or permanently. Any person who shall wilfully deprive the owner of any vehicle, either temporarily or permanently by taking possession of, or driving, or taking away said vehicle, or any person who shall assist in or be a party to such taking possession of, or driving, or taking away of any vehicle belonging to another and standing in any street, road, garage or other building or place, or whoever receives, buys or conceals 362 any vehicle knowing or having reason to believe the same to have been stolen, shall be deemed guilty of felony." Petitioner here contends that the offense of which he was convicted in Utah in violation of the foregoing statute, is not one of the offenses enumerated in section 644 of the Penal Code of California, that its commission, therefore, constituted no ground for adjudging him to be an habitual criminal, and that the trial court's finding and judgment based thereon lack requisite support; that the offense defined by the Utah statute is comparable to the offenses defined by section 503 of the California Vehicle Code or by section 499b of our Penal Code, violations of which furnish no basis for a finding of habitual criminality. Section 503 of our Vehicle Code was not enacted until 1935, so was not in effect in 1931 when the Utah offense was committed. However, section 146 of the California Vehicle Act was in effect at the time (see ch. 1026, p. 2133, Stats. 1931, in effect Aug. 14, 1931) and provided: "Any person who shall drive or take a vehicle not his own, without the consent of the owner thereof and in the absence of the owner, and with intent to either permanently or temporarily deprive the owner thereof of his title to or possession of such vehicle, whether with or without intent to steal the same, shall be deemed guilty of a felony. ..." Also, section 499b of the Penal Code at that time provided: "Any person who shall, without the permission of the owner thereof, take any automobile, bicycle, motorcycle, or other vehicle, for the purpose of temporarily using or operating the same, shall be deemed guilty of a misdemeanor. ..." If the offense charged in Utah be held comparable to that defined by section 499b, supra, which was and still is only a misdemeanor, then obviously it was and is not one comprehended by section 644 which specifies felonies only; and if it be held comparable to the offenses defined by section 146 of the Vehicle Act, or by section 503 of the Vehicle Code, though same are defined as felonies, they are not among those specifically referred to in section 644. [1a] Respondent argues that petitioner was convicted in Utah of "auto theft"; that under section 487 of the California Penal Code the larceny of an automobile constitutes grand theft, which is one of the felonies enumerated in section 644, 363 and that, therefore, petitioner was properly found to be an habitual criminal. This reasoning is not convincing. [2] Section 644 is highly penal, and must be given a strict construction. (People v. Ball, 204 Cal. 241, 244 [267 P. 701].) And we are not disposed to extend its scope by including therein offenses not specifically enumerated. Had the Legislature intended that violations of the Motor Vehicle Act should constitute offenses covered by its language, no reason appears why it should not have enumerated them specifically. [1b] Section 146, supra, is more comprehensive than the Utah statute above mentioned, yet it has been held that a violation of same does not furnish a basis for adjudging a defendant an habitual criminal. In People v. McChesney, 39 Cal.App.2d 36 [102 P.2d 455], the trial court adjudged defendant to be an habitual criminal, and sentenced him to imprisonment for life. The information in that case alleged three prior convictions for which defendant served terms in prison, to wit, in Louisiana for "breaking and entering a building in the night"; in California for violation of "section 146 of the Motor Vehicle Act of California"; in California for committing a felony, "robbery of the first degree." The court said, page 41: "Two of these convictions were not ones on which a judgment as an habitual criminal could be based. Violation of section 146 of the Motor Vehicle Act is not such an offense as denounced in Penal Code, section 644. The test is not whether one has been twice or thrice convicted of felonies, but they must be either among those enumerated in section 644, or denounced as such by the laws of this state." In People v. Gibson, 63 Cal.App.2d 632 [146 P.2d 971], this court held that to constitute the offense defined by section 503 of the Vehicle Code, an intent permanently or temporarily to deprive the owner of title or possession of the vehicle must be proven, and that such intent had not been shown. To the same effect are People v. Neal, 40 Cal.App.2d 155, 117 [104 P.2d 555], and People v. Zervas, 61 Cal.App.2d 381 [142 P.2d 946]. In the former case the court said that under section 503 of the Vehicle Code, an intent either permanently or temporarily to deprive the owner of his title or possession of the vehicle taken, must be proven as "an affirmative element of the crime," and that the taking and abandonment of the car by appellant in that case did not necessarily furnish 364 sufficient evidence from which the presence of a specific intent might be inferred. In People v. Pearson, 41 Cal.App.2d 614 [107 P.2d 463], it was held that a violation of section 503 of the Vehicle Code is not robbery or attempted robbery, since the elements necessary to be proven are different; and in People v. Lohr, 28 Cal.App.2d 397 [82 P.2d 615], the court said that transportation of an automobile in interstate commerce, knowing it to have been stolen, in violation of the Dyer Act, while an offense comparable to that defined by section 146 of the California Vehicle Act, is not one of those enumerated in section 644, and that a prior conviction of same could not be used as a basis for a finding that defendant was an habitual criminal. [3] That grand theft and a violation of section 503 of the Vehicle Code are separate and distinct offenses, and that the latter is a lesser offense, is stated in People v. Jeffries, 47 Cal.App.2d 801, 807, 808 [119 P.2d 190]. This is in accord with the statement in Huddy's Encyclopedia of Automobile Law, volume 9-10, section 116, pages 192-193, that "A special provision of law has been enacted in some jurisdictions providing a punishment for the unlawful taking or use of an automobile ... without the owner's consent. Such a statute is constitutional, and creates a distinct offense, one not necessarily included in the crime of larceny, although it may classify the offense as larceny." And the same authority states, section 60, pages 116-117, that the essential elements of the crime of larceny of an automobile include "the intent to deprive the owner permanently of the possession thereof," and that where the taking of the vehicle is merely for the purpose of using it for a brief period the crime of larceny or theft is not committed. [4] To the same effect is the statement in 15 California Jurisprudence, section 12, page 906, that to constitute the crime of larceny an intent to steal is an essential element of the offense, and it must be an intent wholly and permanently to deprive the owner thereof, which intent must exist at the time of the taking. (See People v. Payne, 117 Cal.App. 108, 111 [3 P.2d 328].) In State v. Mularkey, 195 Wis. 549 [218 N.W. 809], a statute provided: "Any person who shall take, use and operate any automobile ... upon any public highway of this state without the consent of the owner thereof shall, upon conviction thereof," be punished, etc. ( 343.18 Stats.) The court said this constituted a distinct offense, one not necessarily 365 included in the crime of larceny, citing Eastway v. State, 189 Wis. 56 [206 N.W. 879]. In the latter case Eastway was acquitted of larceny, and then charged with taking the automobile in question in violation of section 343.18 of the statutes of the state. The court held that the offenses were distinct and that the acquittal of the larceny was not a bar to prosecution for latter offense. In Slater v. Commonwealth, 179 Va. 264 [18 S.E.2d 909], the court said that the main difference between common law larceny, and the statutory offense of unauthorized use, is that in the former there must be an intent to deprive the owner of his property permanently, while in the latter the intent is to deprive the owner of possession temporarily and without intent to steal; and that the intent with which property is taken determines the offense. In Smith v. State, 66 Tex.Cr. 246 [146 S.W. 547], defendant took a car from a garage and after riding around in it returned it to an alley in the rear of the owner's house the same night; and it was held that the taking did not constitute theft. In State v. Boggs, 181 Iowa 358 [164 N.W. 759], it was said that the taking of a motor vehicle and operating the same without intention of appropriating it permanently to the use of the person taking and operating it, is not larceny, and could not be punished as such. The Utah information filed against this petitioner does not charge that he took the automobile with intent to deprive the owner of the title or possession of same either temporarily or permanently; it merely charges that he deprived the owner of the vehicle by taking possession of same and driving it away. Though the offense was designated a felony, nevertheless, it bears a closer resemblance to our Penal Code section 399b, the so-called "joy-ride" statute, than it does to either section 146 or section 503, supra, since, for all that appears, the taking of the vehicle may have been merely for the purpose of temporarily using or operating the same. And it may be said, in passing, that the Legislature of Utah has now reduced the offense with which defendant was charged, from felony to misdemeanor. [1c] From the foregoing we conclude that the offense with which petitioner was charged in Utah, had it been committed in California, would not have constituted an offense included among those enumerated in section 644 of the Penal Code, and that petitioner's conviction thereof did not furnish grounds for adjudging him an habitual criminal. It may also 366 be noted that while the judgment of the trial court provided that petitioner should be imprisoned "for the term of his natural life with the possibility of parole," section 1168 of the Penal Code as it read at the time of petitioner's conviction in this state provided that the court in imposing sentence should not fix the term or duration of the period of imprisonment, that being a matter for the State Board of Prison Directors (see Stats. 1933, ch. 814, p. 2156). It being conceded by respondent that petitioner has now served, with the benefit of credits earned and granted, the maximum term of imprisonment provided by law for the offense of which he was convicted in California, to wit, burglary of the second degree, it follows that his present detention is illegal. It is therefore ordered that he be discharged from custody. Peek, J., and Thompson, J., concurred.	{ "pile_set_name": "FreeLaw" }
FOR PUBLICATION UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT ZURICH AMERICAN INSURANCE No. 18-16937 COMPANY; AMERICAN GUARANTEE AND LIABILITY D.C. No. INSURANCE COMPANY, 2:15-cv-00460-JAD- Plaintiffs-Appellants, PAL v. ORDER CERTIFYING IRONSHORE SPECIALTY QUESTION TO INSURANCE COMPANY, THE NEVADA Defendant-Appellee. SUPREME COURT Filed July 2, 2020 Before: Marsha S. Berzon and Sandra S. Ikuta, Circuit Judges, and Ivan L.R. Lemelle,* District Judge. Order * The Honorable Ivan L.R. Lemelle, United States District Judge for the Eastern District of Louisiana, sitting by designation. 2 ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. SUMMARY Certification to Nevada Supreme Court The panel certified to the Nevada Supreme Court the following questions: Whether, under Nevada law, the burden of proving the applicability of an exception to an exclusion of coverage in an insurance policy falls on the insurer or the insured? Whichever party bears such a burden, may it rely on evidence extrinsic to the complaint to carry its burden, and if so, is it limited to extrinsic evidence available at the time the insured tendered the defense of the lawsuit to the insurer? This summary constitutes no part of the opinion of the court. It has been prepared by court staff for the convenience of the reader. ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. 3 ORDER We ask the Nevada Supreme Court to resolve two open questions of state law. First, we need guidance regarding whether the insurer or the insured bears the burden of proving the applicability of an exception to an exclusion of coverage in an insurance policy. We also need guidance in determining whether the party carrying such burden may rely on extrinsic evidence, and if so, whether only extrinsic evidence available at the time the insured tendered the defense of the lawsuit to the insurer is relevant for proving an exception to the exclusion. Accordingly, we certify the following questions: Whether, under Nevada law, the burden of proving the applicability of an exception to an exclusion of coverage in an insurance policy falls on the insurer or the insured? Whichever party bears such a burden, may it rely on evidence extrinsic to the complaint to carry its burden, and if so, is it limited to extrinsic evidence available at the time the insured tendered the defense of the lawsuit to the insurer? Our phrasing of the questions should not restrict the Court’s consideration of the issues involved. The Court may rephrase the questions as it sees fit in order to address the contentions of the parties. If the Court agrees to decide these questions, we agree to accept its decision. We recognize that the Court has a substantial caseload, and we submit these questions only because of their significance to actions brought to enforce an insurer’s duty to defend under Nevada insurance law. 4 ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. I This case is an insurance coverage dispute between Ironshore Specialty Insurance Company (Ironshore), on the one hand, and American Guarantee & Liability Insurance Company and Zurich American Insurance Company (collectively, “Zurich”), on the other. 1 Beginning in the early 2000s, about a dozen development companies built thousands of homes using various subcontractors. Eight subcontractors are relevant here.2 Each of these subcontractors completed its work on the various properties before 2009. During this period, each was insured by Zurich for property damage that occurred during the policy period. Some time after completion of their work on these housing developments, each of the eight subcontractors obtained an insurance policy from Ironshore. The Ironshore policy insured the subcontractors for bodily injury or property damage that occurred during the policy period. The policy period for each subcontractor began in 2009 and ended in either 2010 or 2011. 1 We granted Zurich’s motion to substitute Zurich American Insurance Company for Assurance Company of America and Northern Insurance Company of New York. 2 The subcontractors are Cedco, Inc., Lukestar Corporation dba Champion Masonry, Debard Plumbing, Inc., JP Construction Co., LLC, Laird Whipple Construction, Inc., PR Construction Corp., Nevada Concrete Services, Inc. aka Stewart & Sundell, and Universal Framing, Inc. ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. 5 The insurance contract between Ironshore and the eight subcontractors states, in relevant part: We will pay those sums that the insured becomes legally obligated to pay as damages because of “bodily injury” or “property damage” to which this insurance applies. We will have the right and duty to defend the insured against any “suit” seeking those damages. However, we will have no duty to defend the insured against any “suit” seeking damages for “bodily injury” or “property damage” to which this Insurance does not apply. We may, at our discretion, investigate any “occurrence” and settle any claim or “suit” that may result. . . . This insurance applies to “bodily injury” and “property damage”only if: (1) The “bodily injury” or “property damage” is caused by an “occurrence” that takes place in the “coverage territory”; [and] (2) The “bodily injury” or “property damage”occurs during the policy period.3 3 The Ironshore policies define “occurrence” to mean “an accident, including continuous or repeated exposure to substantially the same general harmful conditions.” The policies also define “property damage” to mean “[p]hysical injury to tangible property, including all resulting loss 6 ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. In addition to the coverage provision, Ironshore’s policy also includes an exclusion provision, which states: This insurance does not apply to any “bodily injury” or “property damage”: 1. which first existed, or is alleged to have first existed, prior to the inception of this policy. “Property damage” from “your work”, or the work of any additional insured, performed prior to policy inception will be deemed to have first existed prior to the policy inception, unless such “property damage” is sudden and accidental and takes place within the policy period[]; or 2. which was, or is alleged to have been, in the process of taking place prior to the inception date of this policy, even if the such “bodily injury” or “property damage” continued during this policy period; or of use of that property. All such loss of use shall be deemed to occur at the time of the physical injury that caused it.” ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. 7 3. which is, or is alleged to be, of the same general nature or t y p e a s a c on d i t i o n , circumstance or construction defect which resulted in “bodily injury” or “property damage” prior to the inception date of this policy. Between 2010 and 2013, homeowners who purchased homes within these development projects brought 14 construction defect lawsuits against the developers in Nevada state court (the “Underlying Lawsuits”).4 The developers then sued each subcontractor as a third-party defendant. The complaints in the Underlying Lawsuits alleged that the defendants performed construction work on specific properties, that the work was defective, and that the properties were damaged as a result. The typical complaint said the following: Plaintiffs have discovered defects and damages within the periods of the applicable statutes of limitations that the subject property has and is experiencing defective conditions, in particular, there are damages stemming from, among other items, defectively built 4 Although there was a 15th lawsuit in which homeowners sued a different subcontractor, RAMM Corp., that lawsuit is not relevant to this appeal because Zurich expressly waived any argument with respect to the district court’s ruling related to that lawsuit. 8 ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. roofs, leaking windows, dirt coming through windows, drywall cracking, hardboard separating, hardboard staining, stucco cracking, stucco staining, and other poor workmanship. ... Within the last year, Plaintiffs have discovered that the subject property has and is experiencing additional defective conditions, in particular, there are damages stemming from, among other items, defectively built roofs, leaking windows, dirt coming through windows, drywall cracking, hardboard separating, hardboard staining stucco cracking, stucco staining and other poor workmanship. Although each complaint alleged that the homeowner suffered property damage, no complaint made specific allegations describing when or how the property damage occurred. After being sued by the homeowners, the subcontractors tendered the defense to Zurich. Zurich agreed to defend the subcontractors against the Underlying Lawsuits. Zurich also sent tender letters to Ironshore requesting defense and indemnification on behalf of the subcontractors. After receiving these tender letters, Ironshore investigated the claims and disclaimed coverage pursuant to the exclusion provision in its insurance policy. Specifically, Ironshore relied on paragraph 1 of the exclusion, which provides that its ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. 9 insurance does not apply to property damage from work performed by a subcontractor before the policy inception, because such damage is deemed to have existed before the inception of the policy. Zurich settled each of the claims against the subcontractors. Zurich then sued Ironshore, seeking contribution and indemnification for the defense and settlement costs, as well as a declaration that Ironshore owed a duty to defend the subcontractors against the Underlying Lawsuits. Ironshore moved for summary judgment, arguing that it had no duty to defend because there was no potential for coverage under the terms of its insurance policy. The district court (Judge Jennifer Dorsey) granted summary judgment in favor of Ironshore. The court stated that Ironshore’s exclusion provision “bars coverage if the insured worked on a home before the policy-start date, even if the damage from that work actually occurred after the policy went into effect.” And because there was “no dispute that all of the construction work was done” before the policies took effect, the court concluded that Ironshore had no duty to defend.5 The court rejected the argument that the “sudden and accidental” exception to the exclusion of coverage applied. The court reasoned that none of the complaints in the Underlying Lawsuits alleged that the damage occurred 5 Because the district court ruled that Ironshore did not owe a duty to defend, the court did not address the narrower duty to indemnify. See Allstate Ins. Co. v. Miller, 212 P.3d 318, 324 (Nev. 2009). Therefore, this appeal does not directly implicate the duty to indemnify. 10 ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. suddenly, and, absent any evidence to support such an allegation, Zurich failed to carry its burden. (The court assumed that Zurich could have introduced extrinsic evidence, but did not directly address the question.). Accordingly, the court granted Ironshore’s motion for summary judgment. In effect, Judge Dorsey implicitly concluded that the insured (or in this case, Zurich) had the burden of establishing the applicability of the sudden and accidental exception to the exclusion. Shortly before the district court issued its decision, a different Nevada district court (Judge Gloria Navarro) reached a different conclusion in a substantially identical case. See Assurance Co. of Am. v. Ironshore Specialty Ins. Co., No. 2:13-cv-2191, 2015 WL 4579983 (D. Nev. July, 29, 2015), submission deferred sub nom. Zurich Am. Ins. Co. v. Ironshore Specialty Ins. Co., No. 18-16857 (9th Cir. April 14, 2020) (referred to as “Nevada Zurich II”). After considering substantially identical facts and the same Ironshore insurance policy, Judge Navarro concluded that Ironshore owed a duty to defend because the underlying complaints in that case “did not specify when the alleged property damage occurred and did not contain sufficient allegations from which to conclude that the damage was not sudden and accidental.”6 Nevada 6 After a bench trial, Judge Navarro also held that Ironshore failed to “meet its burden of proving the absence of actual coverage,” i.e., duty to indemnify, because it failed to demonstrate that the exclusion provision bars coverage. Nevada Zurich II, 2017 WL 4570303, at 6 (D. Nev. Oct. 12, 2017). As previously mentioned, supra note 5, Judge Dorsey did not rule on the duty-to-indemnify issue, so that issue is not directly raised in the appeal underlying this certified question. Nevertheless, because the duty to indemnify is narrower than the duty to defend, see Miller, 212 P.3d at 324, we understand that the Nevada Supreme Court’s answer to the burden-of-proof question raised in this certification order would ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. 11 Zurich II, 2015 WL 4579983, at 5. Absent evidence that the alleged property damage was not sudden and accidental, the court concluded that Ironshore failed to carry its burden of showing that the exception to the exclusion did not apply. Id. Again, Judge Navarro assumed extrinsic evidence was admissible, but did not address the issue directly. In effect, Judge Navarro implicitly concluded that the insurer (or in this case, Ironshore) had the burden of proving the nonapplicability of the exception to the exclusion. In light of Nevada Zurich II, Zurich filed a motion under Rule 60(b) of the Federal Rules of Civil Procedure seeking relief from the judgment in the case underlying this certification order. Judge Dorsey denied the motion, stating that she was not persuaded by Judge Navarro’s reasoning. 7 Zurich timely appealed. We stay Zurich’s appeal of the grant of summary judgment in favor of Ironshore pending the Nevada Supreme Court’s resolution of the questions we certify here. In a concurrently filed order, we also stay Ironshore’s appeal of Nevada Zurich II. See Order, Zurich Am. Ins. Co. v. Ironshore Specialty Ins. Co., 18-16857 (9th Cir. July 2, 2020). likewise answer a similar question regarding who bears the burden of proving the duty to indemnify. 7 Zurich did not argue to Judge Dorsey, nor does it argue on appeal, that Judge Navarro’s ruling had a preclusive effect. Accordingly, any such argument is forfeited. See United States v. Depue, 912 F.3d 1227, 1232–33 (9th Cir. 2019) (en banc). 12 ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. II On appeal, the key question underlying the parties’ dispute relates to who bears the burden of proof in establishing the duty to defend under an insurance policy, and what evidence may be used to carry that burden.8 Because Zurich is seeking contribution from a nonparticipating co- insurer, Zurich bears the same burden of proof as an insured. See United Nat’l Ins. Co. v. Frontier Ins. Co., 99 P.3d 1153, 1155–56 (Nev. 2004) (treating the insured and the participating insurer identically). The complaints in the Underlying Lawsuits do not include any allegations as to when or how the alleged property damage occurred. So, if the insured has the burden of proving the applicability of the “sudden and accidental” exception to the exclusion of coverage, then Ironshore would prevail, because the complaints in the Underlying Lawsuits do not indicate that the alleged property damage were sudden and accidental. But if the insurer has the burden of proving that the exception to the exclusion does not apply, then Zurich would prevail under the same logic. This result would be different only if the parties could introduce extrinsic evidence regarding whether the property damage was sudden and accidental. 8 Zurich also argues that the exclusion provision in Ironshore’s insurance policy “is inherently in conflict with the insuring agreement and therefore, creates an ambiguity which should be construed against [Ironshore].” We hereby reject this argument and hold that Ironshore’s policy unambiguously excludes property damage caused by work that was completed before the policy’s inception, subject only to the exception from the exclusion. ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. 13 A Nevada law does not clearly resolve either the burden-of- proof question or the extrinsic-evidence question. With respect to the burden of proof, under Nevada law, the insured bears the burden of proof initially and must demonstrate that the claim is “within the terms of the policy.” Nat’l Auto. & Cas. Ins. Co. v. Havas, 339 P.2d 767, 768 (Nev. 1959). If the insured carries its burden, then the burden shifts to the insurer to show that an exclusion applies. Id. But Nevada law is silent as to whether the insured’s burden to show coverage includes showing the applicability of an exception to an exclusion. There are reasonable arguments on both sides. The argument that the insurer (here, Ironshore) bears the burden of proving the non-applicability of an exception to an exclusion of coverage is as follows. The duty to defend is based on allegations in the complaint. United Nat’l, 99 P.3d at 1158. The insurer must defend unless there is no potential coverage under the insurance policy. Id. Where (as here) the complaint is silent on whether the property damage was sudden and accidental, there is a potential that the damage were sudden and accidental. Therefore, it is up to the insurer to disprove such potential. The counterargument that the insured (Zurich) bears the burden of proving that the exception to the exclusion applies is as follows. Insurance policies are treated like contracts under Nevada law, so ordinary contract principles apply. Century Sur. Co. v. Andrew, 432 P.3d 180, 183 (Nev. 2018). Under such contract principles, the plaintiff has the initial obligation to prove breach, such as that the conditions precedent were fulfilled but the defendant failed to perform. Clark Cty. Sch. Dist. v. Richardson Const., Inc., 168 P.3d 87, 14 ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. 95 n.21 (Nev. 2007). The burden then shifts to the defendant, which has the obligation to raise an affirmative defense. Id. If the defendant can establish the applicability of an affirmative defense, then the burden shifts back to the plaintiff to prove its case. See Nevada Ass’n Servs., Inc. v. Eighth Jud. Dist. Ct., 338 P.3d 1250, 1254 (Nev. 2014) (“Once a defendant shows that a voluntary payment was made [an affirmative defense], the burden shifts to the plaintiff to demonstrate that an exception to the voluntary payment doctrine applies.”). As the plaintiff, the insured must establish that the insurer has a duty to defend and breached the contract by failing to do so. There is no duty to defend if there is no potential for coverage, United Nat’l, 99 P.3d at 1158, so the insured must show a potential for coverage. If, after “comparing the allegations of the complaint with the terms of the policy,” the insured has shown that “there is arguable or possible coverage,” id., then the burden shifts to the insurer to prove an affirmative defense, i.e., that the alleged loss is excluded from coverage, see Havas, 339 P.2d at 768. Under California law, if the insurer proves the applicability of an exclusion, the burden shifts back to the plaintiff to prove that an exception to the exclusion applies, such that the insurer owed a duty to defend. See Aydin Corp. v. First State Ins. Co., 18 Cal. 4th 1183, 1188, 1194 (1998);9 see also Aeroquip Corp. v. Aetna Cas. & Sur. Co., 26 F.3d 893, 895 (9th Cir. 1994) (predicting 9 Although Aydin involved the duty to indemnify, which under California law (just as under Nevada law) is narrower than the duty to defend, see Certain Underwriters at Lloyd’s of London v. Super. Ct., 24 Cal. 4th 945, 961 (2001), California courts have applied Aydin in the broader duty-to-defend context, see McMillin Cos. v. Am. Safety Indem. Co., 233 Cal. App. 4th 518, 533 n.23 (2015); Croskey et al., California Practice Guide: Insurance Litigation ¶ 7:571.6 (The Rutter Group 2019). ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. 15 that California, like the majority of other states, would place the burden of proving the applicability of an exception to an exclusion on the insured, because such an “allocation aligns the burden with the benefit and is consistent with the general principle under California law that while the burden is on the insurer to prove a claim covered falls within an exclusion, the burden is on the insured initially to prove that an event is a claim within the scope of the basic coverage.” (quotation omitted)). Although the Nevada Supreme Court has not spoken on this issue, given that Nevada’s duty to defend appears to be identical to California’s, and Nevada courts often look to California for guidance,10 it is reasonable to conclude that the Nevada Supreme court would adopt the California approach. B The allocation of the burden of proof will decide this case as a matter of law if Nevada adheres to the four corners rule. The Nevada Supreme Court has not decided whether parties may use evidence extrinsic to the complaint to carry their burden, and if so, whether they can adduce only evidence available at the time of the tender, or may also rely on evidence developed later. Nevada’s seminal insurance-coverage case, United National, does not resolve whether extrinsic evidence is 10 Nevada’s seminal case on the duty to defend is United National, wherein the Nevada Supreme Court cited to California case law several times. See 99 P.3d at 1158 n.21, n.23, & n.25 (citing Horace Mann Ins. Co. v. Barbara B., 4 Cal. 4th 1076 (1993); Gray v. Zurich Ins. Co., 65 Cal. 2d 263 (1966); Aetna Cas. & Sur. Co. v. Centennial Ins. Co., 838 F.2d 346 (9th Cir. 1988) (applying California law)). 16 ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. admissible to establish whether there is coverage. First, United National explains that the process for determining whether an insurer owes a duty to defend involves comparing only “the allegations of the complaint with the terms of the policy,” 99 P.3d at 1158, which suggests the party that bears the burden of proof with respect to the duty to defend may not rely on extrinsic evidence. But in explaining the difference between the duty to defend and the duty to indemnify, United National noted that “an insurer bears a duty to defend its insured whenever it ascertains facts which give rise to the potential of liability under the policy.” Id. (alteration and omission adopted) (quoting Gray, 65 Cal. 2d at 276–77). It also suggested that an insurer could not evade “its obligation to provide a defense for an insured without at least investigating the facts behind a complaint.” Id. This language suggests that an insurer may (or must) consider extrinsic evidence available at the time the insured tendered the lawsuit to the insurer. More recently, the Nevada Supreme Court clarified that “facts outside of the complaint cannot justify an insurer’s refusal to defend its insured.” Andrew, 432 P.3d at 184 n.4. We interpret Andrew as prohibiting an insurer’s reliance on extrinsic evidence available at the time of tender to defeat the duty to defend. But Andrew did not address whether extrinsic evidence may trigger the duty to defend when the complaint alone would not trigger such a duty. And the Nevada Supreme Court has not spoken on whether, if extrinsic evidence may be used, the parties may rely on evidence developed after the time of the tender to establish that the exception to the exclusion was or was not applicable. In other words, in a lawsuit such as this one, it is unclear whether the party carrying the burden of proving an exception to the exclusion may adduce new evidence to prove that the ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. 17 property damage at issue was (or was not) sudden and accidental. If Nevada adopts the rule that the parties may consider only the four corners of the complaint, then this case can be decided as a matter of law, because there is no dispute that the complaints in the Underlying Lawsuits are silent as to when or how the property damage occurred. Put differently, the complaints neither establish nor disprove that the property damage was “sudden and accidental,” so the party that bears the burden of proof with respect to the exception to the exclusion will be unable to carry its burden. On the other hand, if Nevada permits the use of extrinsic evidence, then the outcome will depend on whether Zurich or Ironshore can show there is a genuine issue of material fact as to the applicability or non-applicability of the exception to the exclusion, depending on which party bears the burden and what evidence can be adduced. The Nevada Supreme Court’s answer to these questions will be dispositive of these issues in the earlier action, and we will follow its decision in this case. III The Clerk of Court is hereby directed to transmit forthwith to the Nevada Supreme Court, under official seal of the Ninth Circuit, a copy of this order and request for certification and all relevant briefs and excerpts of record. Submission of this case remains deferred, and the case will be submitted following receipt of the Nevada Supreme Court’s opinion on the certified questions or notification that it declines to answer the certified questions. The Clerk shall administratively close this docket pending a ruling by the Nevada Supreme Court regarding the certified questions. The 18 ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. panel shall retain jurisdiction over further proceedings in this court. The parties shall notify the Clerk of this court within one week after the Nevada Supreme Court accepts or rejects certification. In the event the Nevada Supreme Court grants certification, the parties shall notify the Clerk within one week after the Court renders its opinion. QUESTIONS CERTIFIED; PROCEEDINGS STAYED. Marsha Berzon Circuit Judge Sandra Ikuta Circuit Judge Ivan L.R. Lemelle District Judge for the Eastern District of Louisiana ZURICH AM. INS. V. IRONSHORE SPECIALTY INS. 19 Supplemental Material Pursuant to Rule 5 of the Nevada Rules of Appellate Procedure, we include here the designation of the parties who would be the appellants and appellee in the Nevada Supreme Court, as well as the names and addresses of counsel. For Appellants Zurich American Insurance Company and American Guarantee & Liability Insurance Company: William Reeves Morales Fierro & Reeves 600 S. Tonopah Drive Suite 300 Las Vegas, NV 89106 For Appellee Ironshore Specialty Insurance Company: William C. Morison Morison & Prough, LLP 2540 Camino Diablo Suite 100 Walnut Creek, CA 94597	{ "pile_set_name": "FreeLaw" }
755 F.2d 932 Unpublished DispositionNOTICE: Sixth Circuit Rule 24(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Sixth Circuit.DON C. PASCOE, PLAINTIFF-APPELLANT,v.INTERNAL REVENUE SERVICE AND I.R.S. AGENT H. NOVY, ANDZANTOP INTERNATIONAL AIRLINES AND ZIA AGENT H.ZANTOP, DEFENDANTS-APPELLEES. NO. 84-1138 United States Court of Appeals, Sixth Circuit. 1/11/85 ORDER BEFORE: ENGEL, KEITH and JONES, Circuit Judges. 1 This pro se taxpayer appeals from a district court judgment dismissing his complaint for lack of subject matter jurisdiction and for failure to state a claim upon which relief can be granted. Seeking injunctive and declaratory relief, plaintiff sued the defendants alleging that they were 'collaborating by distraint' to seize his property without due process of law in violation of the fifth, thirteenth and fourteenth amendments of the constitution. Plaintiff explained that in November of 1983 the defendants totally ignored his withholding exemption certificate which indicated that he was totally exempt from federal income tax withholding and that his employer, upon direction by the I.R.S., began to withhold tax from his wages as if he were single and had claimed one withholding allowance. 2 On appeal from the dismissal of his complaint, plaintiff argues that: 1) the defendants have seized his property by illegal distraint; 2) his wages are not income; 3) he does not have to file a tax return; 4) the anti-injunction statute is illegal; 5) his constitutional rights guaranteed under the fifth, thirteenth and fourteenth have been violated; 6) he is entitled to a refund of all his taxes paid from 1976 to the present as the federal income tax is an illegal direct tax on individuals; and, 7) he had met the criteria to support his request for a preliminary injunction. 3 Upon a careful review of the cause and of the arguments presented by the parties in their briefs, this Court concludes that the district court properly dismissed plaintiff's complaint for the reasons stated by it. The practice of ignoring an unsubstantiated withholding exemption certificate and imposing withholding as if the taxpayer were single claiming one withholding allowance has specifically been upheld as being a proper exercise of the government's power to assess and collect taxes which is not in violation of the federal constitution. See Robinson v. A & M Electric, Inc., 713 F.2d 608 (10th Cir. 1983); Stonecipher v. Bray, 653 F.2d 398 (9th Cir. 1981), cert. denied, 454 U.S. 1145 (1982); United States v. Warinner, 607 F.2d 210 (8th Cir. 1979), cert denied, 454 U.S. 927 (1980). The challenge to this practice in this case is also clearly without substance as the plaintiff argues in support of his various arguments that his wages do not constitute income which can be taxed. This argument, however, is patently without merit. See Perkins v. C.I.R., ---- F.2d ----, slip op. 83-1716 (6th Cir. October 31, 1984); United States v. Richards, 723 F.2d 646 (8th Cir. 1983), and cases cited therein. And so, therefore, is plaintiff's entire case without merit. His income is in excess of $1,000 as his wages are included as income and he is, accordingly, required to file a return pursuant to 26 U.S.C. Sec. 6012. A person's failure to file may even subject oneself to criminal liability under 26 U.S.C. Sec. 7203. United States v. Grumka, 728 F.2d 794 (6th Cir. 1984). Plaintiff's constitutional challenge to the anti-injunction statute, 26 U.S.C. Sec. 7421(a), is also without merit as this law has been expressly upheld and applied by the Supreme Court. See, e.g., Bob Jones University v. Simon, 416 U.S. 725 (1974); Alexander v. American United, Inc., 416 U.S. 752 (1974). This prohibition contained in this act was also properly applied in this case as plaintiff clearly failed to show that an exception applied to his case. Dickens v. United States, 671 F.2d 969, 971 (1982). Finally, all of plaintiff's remaining constitutional arguments, including his claim that the federal income tax is illegal because it is not apportioned among the states thereby rendering it a direct tax, are likewise without merit. See Perkins v. C.I.R., supra, and cases cited therein. 4 For these reasons, this panel unanimously agrees that oral argument is not necessary in this appeal. Rule 34(a), Federal Rules of Appellate Procedure. The district court's judgment is, accordingly, affirmed pursuant to Rule 9(d)(3), Rules of the Sixth Circuit.	{ "pile_set_name": "FreeLaw" }
UNPUBLISHED ORDER Not to be cited per Circuit Rule 53 United States Court of Appeals For the Seventh Circuit Chicago, Illinois 60604 Argued July 11, 2006 Decided July 18, 2006 Before Hon. WILLIAM J. BAUER, Circuit Judge Hon. RICHARD A. POSNER, Circuit Judge Hon. MICHAEL S. KANNE, Circuit Judge No. 05-4390 UNITED STATES OF AMERICA, Appeal from the United States District Plaintiff-Appellee, Court for the Western District of Wisconsin. v. No. 05-CR-091-C-01 JEFFREY J. MILLER, Barbara B. Crabb, Defendant-Appellant. Chief Judge. ORDER Jeffrey Miller pleaded guilty to mail fraud, 18 U.S.C. § 1341. In calculating his sentence, the district court applied the two-level enhancement for abuse of a position of trust. Miller challenges this enhancement, arguing that it was precluded because the base offense level and offense characteristics already addressed his abuse of a position of trust. We disagree and affirm the district court’s sentence. In 2005 Miller pleaded guilty to using the United States Postal Service to defraud clients of his investment firm, One Vision Financial (“OVF”). Miller’s scheme was simple: from 2000 to 2004 he persuaded OVF’s clients to invest substantial amounts of money in the firm’s investment network or the investment portfolios it administered. But instead of investing the clients’ funds in either, Miller converted them to his own personal use or used them to pay OVF’s operating expenses. He then mailed his clients worthless promissory notes that recorded the No. 05-4390 Page 2 amount the client “invested” with OVF and promised an imaginary annual return. In all, Miller defrauded more than 40 clients of approximately $3.5 million. The probation officer prepared a presentence investigation report in which she calculated the base offense level for Miller’s conviction at 7 because the maximum imprisonment term was 20 years. See U.S.S.G. § 2B1.1(a)(1). The probation officer also recommended that the offense level be increased by 18 levels because the loss amount was between $2.5 million and $7 million, U.S.S.G. § 2B1.1(b)(1)(J); two levels because the offense involved ten or more victims, id. § 2B1.1(b)(2)(A); and two more levels because Miller abused a position of trust, id. § 3B1.3. This placed Miller’s base offense level at 24, which, when combined with a criminal history category of I, placed Miller’s recommended guidelines range between 87 and 108 months. Miller objected to the presentence investigation report, arguing that the recommended increase for abuse of a position of trust ran afoul of § 3B1.3. That provision provides for a two-level increase when a “defendant abused a position of public or private trust . . . in a manner that significantly facilitated in the concealment of the offense.” U.S.S.G. § 3B1.3. However, § 3B1.3 also states that “[t]his adjustment may not be employed if an abuse of trust . . . is included in the base offense level or specific offense characteristic.” Id. Seizing on this exception, Miller argued that abuse of a position of trust is included in the base offense level for mail fraud, thus precluding the two-level increase. At the sentencing hearing, the district court rejected Miller’s objections and accepted the recommended two-level increase for abuse of a position of trust. The court stated that Miller exploited his position as a financial advisor to convince his victims to give him their money “in reliance of [his] representations or because [he] promised that [he] wold invest their money in [his] business.” The court then adopted the recommended guidelines range of 87 to 108 months, sentenced Miller to 87 months’ imprisonment, and ordered him to pay assessments and restitution. On appeal, Miller renews his argument that the district court erred by applying the two-level increase under § 3B1.3. He asserts that, because the charging document detailed the manner in which he abused his position as a financial advisor to defraud his clients, his abuse of a position of trust was already accounted for in the base offense level and specific characteristics of mail fraud. In essence, he argues that courts must refer to the charging documents to ascertain the base offense level and specific offense characteristics. But this position is irreconcilable with the language of the Sentencing Guidelines: § 3B1.3 directs courts to refer only to “the base offense level or specific offense characteristic.” See U.S.S.G. § 3B1.3. That provision contains no instruction to refer to charging documents, see id., and Miller points us to no authority that states otherwise. No. 05-4390 Page 3 With that said, Miller’s base offense level does not account for an abuse of a position of trust. Because Miller was convicted under 18 U.S.C. § 1341, his base offense level is determined by § 2B1.1. See U.S.S.G. app. A. This guideline addresses “basic forms of property offenses” involving numerous kinds of fraud, including mail fraud. See U.S.S.G. § 2B1.1 introductory cmt. Miller’s counsel conceded at oral argument that mail fraud does not require an abuse of a position of trust. See United States v. Baldwin, 414 F.3d 791, 799 (7th Cir. 2005) (“It is true that all frauds involve deceit, but they may or may not involve the abuse of a position of trust.”). This concession comports with our recognition that the two-level increase accounts for behavior separate from the predicate offense of fraud; that is, how the defendant exploited his relationship with his victims to perpetrate the fraud. See United States v. Arnaout, 431 F.3d 994, 1000 (7th Cir. 2005); see also United States v. Bracciale, 374 F.3d 998, 1006-07 (11th Cir. 2004) (explaining how commentary to § 3B1.3 “draws a distinction between those who should receive the enhancement and those who should not without regard to the elements of the underlying fraud offense”). And since Miller concedes that he abused his clients’ trust in him as their financial advisor when committing mail fraud, the two-level enhancement was not precluded by the base offense level. See Baldwin, 414 F.3d at 799; see also Bracciale, 374 F.3d at 1005-06. Likewise, Miller’s specific offense characteristics do not account for his abuse of a position of trust. The district court increased Miller’s base offense level by 18 levels because the victims’ loss was between $2.5 million and $7 million, and added an additional two levels because Miller’s offense involved ten or more victims. But both of these determinations do not reflect Miller’s abuse of his position as a financial advisor because they do not account for how Miller exploited his relationship with his victims to defraud them. See U.S.S.G. § 3B1.3 cmt. n.1 (“For this adjustment to apply, the position of . . . private trust must have contributed in some significant way to facilitating the commission or concealment of the offense . . . .”); Bracciale, 374 F.3d at 1006-07 (stating that the applicability of two- level enhancement depends only on the relationship the defendant had with his victims). These determinations rather address the extent and severity of his fraud, facts unrelated to Miller’s abuse of his victims’ trust. See Bracciale, 374 F.3d at 1006-07. AFFIRMED.	{ "pile_set_name": "FreeLaw" }
FILED Mar 16, 2018 04:27 PM(CT) TENNESSEE COURT OF WORKERS' COMPENSATION CLAIMS Ms. Crisp went to the Methodist Hospital emergency room. The Methodist records included only a discharge form that noted the reason for the visit was a "hand injury" and that the provider returned her to work without restriction as of September 10. The provider recommended Ms. Crisp follow up with a physician if she had further problems. At that point, Ms. Crisp spoke with Judith Bennett, Castle's workers' compensation representative. Ms. Bennett said Ms. Crisp told her that she wanted "to go to [her] family physician,' so Ms. Bennett scheduled an appointment for her with Dr. Jul ian Vanego . 1 On September 13, Dr. Vanegos recorded the reasons for Ms. Crisp's visit were pain in both hands "for one week ... coming from heavy lifting at work." He also noted complaints of pain in "both arms" and "both knees" for one week. He recommended physical therapy and a functional capacity exam. As pertinent here, Dr. Vanegos noted the following under the history: • Hand pain with onset of one week at work • Knee pain with onset one year ago because of "long-term heavy lifting" • Shoulder pain for one week • Neck pain with onset of several weeks ago "during work" • Elbow pain for several months and no specific location of where mJury occurred • Wrist pain for several weeks and no specific location of where mJury occurred[.] On September 26, Castle's carrier provided Ms. Crisp a panel of physicians that included Dr. Mark Harriman. Ms. Crisp claimed Janet Thompson, an Erie Insurance adjuster, rudely told her that she must see Dr. Harriman and did not give her the opportunity to choose another physician from the panel. Joyce Beard, Ms. Crisp's friend, overheard the cellphone conversation and corroborated Ms. Crisp's account. Conversely, Ms. Thompson testified that Ms. Crisp voluntarily chose Dr. Harriman and that she was free to choose any physician on the panel. Ms. Crisp saw Dr. Harriman on October 10, and he noted she complained of neck and shoulder pain. In the office note, he wrote: The patient has multiple complaints but based on the current Tennessee Worker's Comp guidelines she has not had a compensable injury. She has worked for her company for 23 years and had been on her present job for two years before she developed symptoms. There was no specific injury at all and she was simply doing the job that she had been doing for two years. 1 The proof is unclear as to whether Dr. Vanegas was Ms. Crisp's family physician before the appointment, but this is not germane to the Court's finding. 2 Dr. Harriman released Ms. Crisp to full duty as of October 10, and Ms. Bennett said Castle had work available for her at the time. Ms. Crisp claimed Dr. Vanegas referred her to Dr. William Moffatt but produced no record of this referral. Instead, the limited records of Dr. Moffatt indicated an October 11 visit where Ms. Crisp reported neck and bilateral shoulder problems. Dr. Moffatt suspected carpal tunnel syndrome and degeneration of a cervical intervertebral disc. Her condition remained unchanged at later visits in December 2016 and February 2017. The records mentioned two onsets: September 6 and October 11, the date of her visit. Dr. Moffatt wrote an off-work note in February 2017, taking Ms. Crisp off work from October 11, 2016, to "indefinitely." For its part, Castle introduced medical records indicating Ms. Crisp previously received treatment for her neck and arms as early as March 2014. At that time, providers at Semmes Murphey Clinic recorded Ms. Crisp complained of neck, arm, back, and leg pain that "clearly had been present for 10 years." Semmes Murphey providers also noted hand, wrist, and arm pain in September 2014. On November 24, 2014, Ms. Crisp told a provider at Wesley Neurological that she thought heavy lifting at work is causing her "to suffer carpal tunnel syndrome (CTS)." She said she underwent a "prior evaluation for her arm pain which she wants checked out through Workman's comp." She complained of carpal tunnel complaints again to a Wesley provider in January 2016, February 2016, and on August 24, 2016. She attributed her problems to heavy lifting at work and expressed a desire to "claim disability for CTS." Ms. Crisp complained of hand, shoulder, knee, and back pain at the offices of three other medical providers in both 2015 and in 2016. At the hearing, Ms. Crisp "apologized" to Castle's counsel because she "didn't remember at the time" she gave a deposition that she "was already going to [a] doctor." She then admitted the previous medical treatment and said she told the providers her pain came from work. She attributed all of her problems to her job but said she did not know she could file a workers' compensation claim until her union representative told her she could, prompting this claim. She contended that "two herniated discs" resulted from the September 6 incident. Ms. Crisp requested payment of medical bills and recovery of "living expenses," which the Court views as a request for temporary disability benefits. She testified the injury prevented her from working since September 6 and requested temporary disability benefits from that date forward. 3 Findings of Fact and Conclusions of Law Standard applied Ms. Crisp must come forward with sufficient evidence from which this Court might determine she is likely to prevail at a hearing on the merits. Tenn. Code Ann. § 50- 6-239(d)(l) (2017). Ms. Crisp elected to represent herself, as is her right, but the Court cannot "excuse [her] from complying with the same substantive and procedural rules that represented parties are expected to observe." Walton v. Averitt Express, Inc., 2017 TN Wrk. Comp. App. Bd. LEXIS 37, at *5 (June 2, 2017). Analysis To be compensable, Ms. Crisp must show her injury arose primarily out of and in the course and scope of her employment and that it was caused by an incident, or specific set of incidents, identifiable by time and place of occurrence. Tenn. Code Ann. § 50-6- 102(14)(A). Further, she must show, "to a reasonable degree of medical certainty that [her injury] contributed more than fifty percent (50%) in causing the ... need for medical treatment[.]" Id. at 50-6-102(14)(C). The Court finds Ms. Crisp failed to show the September 6 injury arose primarily out of her employment at Castle. Rather, Ms. Crisp sought extensive medical treatment for body parts she injured long before the alleged date of injury. Indeed, the medical records established she received medical treatment at five separate providers between 2014 and 2016 for her neck, hands, arms, wrists, back, and legs. This previous treatment dated to as early as March 2014, when Ms. Crisp complained that "heavy lifting at work" caused of her self-described carpal tunnel syndrome. She told a provider then that she wanted a workers' compensation evaluation, a request that is inconsistent with her assertion that she did not know she could file a claim until speaking with her union representative. Notably, Ms. Crisp began her narrative testimony with an "apology" for "forgetting" the prior medical treatment during a deposition, a statement directly and adversely affecting her credibility. Further, the Court finds Ms. Crisp failed to show the injury contributed more than fifty percent to the need for medical treatment. Neither Dr. Vanegos', Dr. Moffatt's, nor Dr. Harriman's records establish she sustained an injury identifiable by time and place of occurrence or that it contributed more than fifty percent to the need for treatment. The medical records are replete with inconsistencies regarding Ms. Crisp's history of the onset and cause of her symptoms. Further, the Court believes Ms. Thompson's testimony that she provided Ms. Crisp a proper panel from which she chose Dr. Harriman. As the approved physician, Dr. Harriman's opinion is presumed correct, and Ms. Smith did not rebut that presumption by a preponderance of the evidence. See Tenn. Code Ann. § 50-6- 102(14)(E). 4 Based on these findings, the Court holds Ms. Crisp has not come forward with sufficient evidence to establish she would prevail at a hearing on the merits regarding the essential element of medical causation. IT IS, THEREFORE, ORDERED as follows: 1. The Court denies Ms. Crisp's request for medical and temporary disability benefits at this time. 2. This matter is set for a telephonic Scheduling Hearing on Tuesday, May 15, 2018, at 11:00 a.m. Central Time. The parties must call toll-free 855-543-5038 to participate in the hearing. Failure to call in may result in a determination of the issues without the party's further participation. ENTERED March 16, 2018. Judge Allen P illips Court of Workers' Compens APPENDIX Exhibits: 1. Collective Medical Bills (Marked for Identification Only) 2. Collective Medical Records of Drs. Moffat, Bingham, and Vanegos; East Memphis Physical Therapy; and January 3, 2017 denial letter from Cigna Insurance for treatment with Dr. Bingham 3. February 2, 2017 MRI report 4. Medical Records of Dr. Mark Harriman 5. Medical Record of Dr. Julian Venegas 6. Medical Records of Dr. William Moffatt 7. Panel of physicians 8. Methodist Hospital Emergency Room Discharge Form 9. Methodist Hospital Work Release Form 10.E-mail from Erie Ins. Co. regarding panel of physicians provided to Ms. Crisp 11. Follow-up e-mail from Erie regarding panel of physicians 12. E-mail from Erie regarding Dr. Harriman appointment 13.Dr. Harriman's release to full duty form 14.Medical Records of Wesley Neurology Clinic 5 15. Medical Records of Delta Pain Management 16. Medical Records of Semmes Murphey Clinic 17.Medical Records of Dr. Fred Wilson 18. Medical Records of Unity Medical Clinic Technical record: 1. Petition for Benefit Determination 2. Dispute Certification Notice 3. Request for Expedited Hearing 4. Motion for Leave to Depose Employee 5. Order Allowing Deposition of Employee and Setting Expedited Hearing 6. Motion of Employer to Allow Telephonic Testimony 7. Order Allowing Telephonic Testimony 8. Employer's Witness List 9. Employer's Exhibit List CERTIFICATE OF SERVICE I certify that a true and correct copy of this Expedited Hearing Order was sent to the following recipients by the following methods of service on March 16, 2018. Name Certified First Via Service sent to: Mail Class Email Mail Ronda Crisp, x x 2808 Waters Edge Rd., Self-Represented Employee Memphis, TN 38127 Robert Binkley, Esq., x [email protected] Attorney for Employer & ~~ , Pen~rum, Court Clerk Court of Workers' Compensation Claims 6	{ "pile_set_name": "FreeLaw" }
. OFCICR OF ‘niI MTORNLY QLNERAL OF TEXAS AUCTIN Id oomlraioMr8.’ I iail to tlna My law that ruthorLo8al8 oxpon(llturo out or tho 8o a &a B r llp ,01M y lth o r r tmd fo r l o o ua t~ Co a d88la no ra nd th e F um r M 5088ln1 0~OIl llC.” pndor tho iaotr 8tato6 in your lottor, tha ark" wu to bo urplo7.dbr l County Corn-- riulonu and the Oount &ont togothor, ana tho otanogrephor- l10*- wa8 to work r0r i0th of tho rboro untlonod offioialr. Bootlon S, Art1010 8 of tho Ton8 OO#l8titutiOn pro- roribo8 the BR&UR tat0 Of tUO8 iOr BOWER JW 808, iU road8 ~4 briG@S, G provoaeultr, T h- O0l 7 iOr j~riO8 ad iOr pU5MMt ro8 lotl?o4. i& irU -X08 1 OVi.d lAd 001 . loo0od for oaoh ot 8ho &boro lmMr8t.6 pqO8e8 UO OoMti- tutiOM1 fUBd8. . Tho Qomml8olonor8~Court bar no authorlty to tramrer moaoy frw oao to udthor oon8tltutlorul hand, or to oxpond n18od taxmollor 0000M1b1~ror anothor pur- iat0 VP080 oitho mT181Ol.l i8 to lbit tho aunt of tax08 tht?tany bo raisd for thee. 90Veral pUl’~OSe8, mo ~llonl road uld brlQo edad 18 a 00fwituti0aai iund ud tho -nOr Of 8Uti OO!l8titUtiOnd fund n\ut b QpliOd to that ptr%ioular purporo for rhloh it war nirod and no other. Thuoforo, It lr our opinion tht no part of tha ralary of tho a~t~o@apiio~olork'k" can logally be plb out OS tho road and brluo fund for '8orrloor poriormd ior tho County Agat. I/ 8OTOrt 6.~ fOpk0 m 8/ hl’dOl1 rilliU8 Aotiw Al’TOR8XT UB?fERAL OF TiCUS &sirtant AiTROVltD0i';HIOBCOUMI'I'TBI: BY COC CKAIWAH	{ "pile_set_name": "FreeLaw" }
[Cite as State v. Smith, 2017-Ohio-4123.] IN THE COURT OF APPEALS ELEVENTH APPELLATE DISTRICT ASHTABULA COUNTY, OHIO STATE OF OHIO, : OPINION Plaintiff-Appellee, : CASE NO. 2016-A-0059 - vs - : STANLEY T. SMITH, : Defendant-Appellant. : Criminal Appeal from the Ashtabula County Court of Common Pleas, Case No. 2014 CR 00207. Judgment: Affirmed. Nicholas A. Iarocci, Ashtabula County Prosecutor, Ashtabula County Courthouse, 25 West Jefferson Street, Jefferson, OH 44047 (For Plaintiff-Appellee). Michelle M. French, Law Offices of Michelle M. French, LLC, 28 West Jefferson Street, Jefferson, OH 44047 (For Defendant-Appellant). CYNTHIA WESTCOTT RICE, P.J. {¶1} Appellant, Stanley T. Smith, appeals the judgment of the Ashtabula County Court of Common pleas denying his pro se motion for jail-time credit. Appellant’s appointed, appellate counsel has filed a brief and requested leave to withdraw, pursuant to Anders v. California, 386 U.S. 738 (1967). Appellant was served with the brief and subsequently filed a pro se appellate brief. After conducting an independent review of appellant’s case, we conclude the instant appeal is wholly frivolous and affirm the trial court’s denial of appellant’s motion. {¶2} On May 30, 2014, appellant was indicted for illegal assembly of chemicals for the manufacture of drugs, a felony of the third degree (“the Ashtabula County case”). Appellant pled not guilty. The bond set in the Painesville Municipal Court was continued and appellant remained free on bond. {¶3} On October 8, 2014, appellant withdrew his not guilty plea and pled guilty to the indictment. Bond was continued pending preparation of a pre-sentence report. The court noted appellant had not served any jail time on this charge. The court scheduled sentencing for December 11, 2014. {¶4} On December 8, 2014, appellant was arrested in Lake County and incarcerated in the Lake County Jail on a new case in which he was also charged with illegal assembly of chemicals for the manufacture of drugs (“the Lake County case”). Upon discovering this development, the Ashtabula County Court rescheduled sentencing for January 27, 2015. {¶5} On January 26, 2015, appellant was conveyed to the Ashtabula County Court for sentencing. At the January 27, 2015 sentencing, appellant was sentenced to two and one-half years in prison with no days of jail-time credit. He was then returned to the Lake County Jail for disposition of the Lake County case. {¶6} Appellant did not file a direct appeal in the Ashtabula County case. Instead, five months after he was sentenced in that case, on June 25, 2015, he filed a pro-se motion for jail-time credit. He conceded he was given 56 days of jail-time credit, but argued he was entitled to an additional 78 days of jail-time credit. Appellant 2 subsequently withdrew this motion, stating he was not entitled to the jail-time credit he requested. {¶7} Thereafter, on August 15, 2016, appellant filed a second pro-se motion for jail-time credit in the Ashtabula County case in which he made virtually the same argument he made in his first motion. The only exhibit appellant attached to this motion was a copy of a brief a Lake County assistant prosecutor filed in opposition to a motion for jail-time credit that appellant apparently filed in the Lake County case. {¶8} In his brief, the Lake County assistant prosecutor asked the trial court to “deny Defendant’s Motion for Jail Time Credit * * .” That prosecutor said: “On April 14, 2015, the Defendant was sentenced to [two years] in prison [in the Lake County Case], with 50 days credit (12/8/14 – 1/26/15), consecutive to his prison sentence in [the Ashtabula County case], in which case he was sentenced on 1/27/15 to [two and one- half years] in prison with 0 days credit.” The prosecutor said appellant “received the correct amount of jail-time credit in [the Lake County case] and that it was for “[t]he Department of Corrections [to] credit the Defendant with serving his Ashtabula County prison sentence from 1/27/15 until at least 4/14/15 when he was sentenced by [the Lake County] Court.” (The Lake County court denied appellant’s motion for jail-time credit. Appellant appealed that ruling and that appeal is now pending in this court.) {¶9} The Ashtabula County assistant prosecutor filed a brief in opposition to appellant’s motion for jail-time credit. The prosecutor argued that appellant’s motion should be denied because it was barred by res judicata and also because appellant had already received credit for time served on the Ashtabula County case, suggesting that if his motion was granted, he would receive duplicate jail-time credit for the period from 3 January 27, 2015 (when he was sentenced in Ashtabula County) to April 14, 2015 (when he was sentenced in Lake County). The trial court denied appellant’s motion. {¶10} Appellant, pro se, appealed the trial court’s ruling. This court appointed Michelle M. French as appellant’s appellate counsel. She filed an appellate brief pursuant to Anders, supra, in which she stated she had reviewed the record and applicable law and could not find any error prejudicial to appellant’s rights. Pursuant to Anders, counsel asked this court to independently review the record to determine whether any possible error exists. {¶11} Counsel asserted the following as appellant’s sole potential assignment of error: “Did the Trial Court err to the prejudice of the Appellant by failing to grant the Appellant the appropriate amount of jail-time credit?” {¶12} In explaining why she believed this appeal is frivolous, appellate counsel stated in her Anders brief: {¶13} Mr. Smith was sentenced to prison on January 27, 2015 in Ashtabula County. He was sentenced to a consecutive prison term in Lake County on April 14, 2015, with jail credit of 50 days. This period represents the time from December 8, 2014 until January 27, 2015, a period of 50 days. Mr. Smith, due to the consecutive sentences ordered, was not given credit in the Lake County case for the time period after January 27, 2015, as he was already serving a prison sentence. {¶14} As a result, appellate counsel asked for permission to withdraw as appellant’s attorney. She also certified she sent a copy of her brief to appellant, explaining an Anders brief and her reason for filing it, and she advised him that he may file his own brief if he chooses. 4 {¶15} Pursuant to the Anders brief, this court gave appellant leave to file his own brief and ordered Attorney French’s request to withdraw be held in abeyance pending this court’s review pursuant to Anders. {¶16} Appellant subsequently filed a brief in which he asserted the following for his sole assignment of error: {¶17} “The Trial Court erred to the prejudice of Appellant’s rights to Due Process and Equal Protection of the Law guaranteed by the United States and Ohio Constitutions by failing to grant Appellant credit for all time spent in the custody of the Sheriff prior to delivering Appellant into the custody of the Ohio Department of Rehabilitation and Corrections.” {¶18} Appellant concedes he was given 56 days of jail-time credit for the 50 days he was in the Lake County Jail prior to his sentencing in the Ashtabula County case (December 8, 2014 to January 26, 2015) and for the six days he remained in the Lake County Jail between his sentence in the Lake County case and his conveyance to prison (April 14, 2015 to April 21, 2015). However, he argues he was also entitled to credit for the 78 days he was held in the Lake County Jail following his Ashtabula County sentence until his Lake County sentence (January 27, 2015 to April 14, 2015). {¶19} As a preliminary matter, the state’s res judicata argument lacks merit. R.C. 2929.19(B)(2)(g)(iii) provides, in pertinent part: {¶20} [A] sentencing court retains continuing jurisdiction to correct any error not previously raised at sentencing in making a determination [of the appropriate jail-time credit] * . The offender may, at any time after sentencing, file a motion in the sentencing court to correct any error made in making [such] determination[.] (Emphasis added.) 5 {¶21} Several courts have held that since R.C. 2929.19(B)(2)(g)(iii) provides that a court has continuing jurisdiction to correct any jail-time credit error not previously raised at sentencing, this statute abates the application of res judicata as it relates to issues that could have been raised at sentencing but were not. State v. Lynch, 10th Dist. Franklin Nos. 15AP-123, etc., 2015-Ohio-3366, ¶9-11; State v. Quarterman, 8th Dist. Cuyahoga No. 101064, 2014-Ohio-5796, ¶8; State v. Copas, 4th Dist. Adams No. 14CA996, 2015-Ohio-5362, ¶11-12; State v. Guiterres, 11th Dist. Trumbull No. 2015-T- 0116, 2016-Ohio-5572, ¶15 (“This provision allows a defendant to raise an issue regarding his jail-time credit in a post-conviction motion, but only when the issue was not considered during the sentencing hearing. If an issue was raised and considered at the time the trial court rendered its original credit ruling, it cannot be asserted again in a motion for additional credit.”) {¶22} Because appellant’s jail-time credit issue was not considered at sentencing, this appeal is not barred by res judicata. {¶23} Turning now to the substance of this appeal, R.C. 2967.191, regarding jail- time credit, provides: {¶24} The department of rehabilitation and correction shall reduce the stated prison term of a prisoner * * by the total number of days that the prisoner was confined for any reason arising out of the offense for which the prisoner was convicted and sentenced, including * * * confinement while awaiting transportation to the place where the prisoner is to serve the prisoner's prison term * * [.] (Emphasis added.) {¶25} Moreover, R.C. 2949.12, regarding conveying a convicted felon to prison, provides: {¶26} [A] convicted felon who is sentenced to serve a term of imprisonment in a state correctional institution shall be conveyed, 6 within five days after sentencing, * * by the sheriff of the county in which the conviction was had to the facility that is designated by the department of rehabilitation and correction for the reception of convicted felons. The sheriff shall deliver the convicted felon into the custody of the managing officer of the reception facility and, at that time, * * * shall present the managing officer with a copy of the convicted felon’s sentence that clearly describes each offense for which the felon was sentenced * * , designates the sentence imposed for each offense for which the felon was sentenced * , and * * specifies the total number of days, if any, that the felon was confined for any reason prior to conviction and sentence. (Emphasis added.) {¶27} Pursuant to the foregoing statutory authority, the trial court has the duty to determine the number of days the prisoner was confined before he was sentenced to prison and to include that amount in the sentencing entry. When the sheriff delivers the prisoner to the prison, the sheriff has the duty to present the managing officer with a copy of the prisoner’s sentence that specifies the total number of days he was confined for any reason prior to his sentence. However, it is the duty of the department of rehabilitation and correction to reduce the prisoner’s prison term by, inter alia, the number of days he was confined while awaiting transportation to the place where he is to serve his prison term. {¶28} Here, the Ashtabula County Court sentenced appellant to prison. However, because he had a case pending in Lake County, he was returned to that county for trial, rather than being conveyed to prison. Only after he was sentenced in the Lake County case was he transported to prison. Pursuant to the mandatory language of R.C. 2967.191, the department of corrections is required to reduce a convicted felon’s prison term by the amount of time he awaited transportation to prison. In the absence of evidence to the contrary, we presume the department of corrections met its statutory obligation to make this reduction. 7 {¶29} Appellant failed to file in the trial court any evidence supporting his motion for jail-time credit, such as records from the Lake County Court, the Lake County Sheriff’s Office, or the department of corrections. Thus, the trial court had no evidence before it concerning the exact amount of jail-time credit to which appellant was entitled or whether he had already been credited with that time by the department of corrections. “An appellate court in determining the existence of error is limited to a review of the record.” State v. Dudas, 11th Dist. Lake No. 2007-L-169, 2008-Ohio-3261, ¶16. On appeal, it is the appellant's responsibility to support his argument by evidence in the record that supports his assigned errors. Id. Because appellant failed to do so, his argument lacks merit. {¶30} Significantly, appellant argues in his appellate brief that on April 21, 2015, when he arrived at prison, he was given materials showing he was only given 56 days of jail-time credit. Yet, he failed to attach a copy of these documents to his motion for jail-time credit. {¶31} Further, the exhibits attached to appellant’s appellate brief (which include another brief filed by the Lake County assistant prosecutor asking that court to deny appellant’s motion for jail-time credit) are not in the trial court’s record. Thus, the trial court did not have an opportunity to consider them when ruling on appellant’s motion. Further, because they are not part of the trial court’s record, we cannot consider them and they are, sua sponte, stricken from the record. {¶32} After a thorough and independent review of the record, we hold the trial court did not err in denying appellant’s motion for jail-time credit. Thus, there are no arguable legal issues on the merits of this appeal. Appellant’s appeal is without merit 8 and is wholly frivolous. Further, because there are no arguable issues in this appeal, the request to withdraw filed by appellate counsel is well taken and is hereby granted. {¶33} For the reasons stated in this opinion, the assignment of error is overruled. It is the order and judgment of this court that the judgment of the Ashtabula County Court of Common Pleas is affirmed. TIMOTHY P. CANNON, J., concurs, THOMAS R. WRIGHT, J., concurs in judgment only. 9	{ "pile_set_name": "FreeLaw" }
579 F.Supp. 683 (1984) UNITED STATES of America, Plaintiff, v. Duane N. VARBEL and Paul Harris, Defendants. No. CR 83-207 PHX EHC. United States District Court, D. Arizona. January 18, 1984. 684 A. Melvin McDonald, U.S. Atty., D. Ariz., W. Ronald Jennings, Paul A. Katz, Asst. U.S. Attys., D. Ariz., Phoenix, Ariz., for plaintiff. Duane N. Varbel, pro se, Gary L. Thomas, Phoenix, Ariz., for Varbel. ORDER CARROLL, District Judge. Counts I through IV in this matter have previously been severed from Counts V through IX. The latter counts name four defendants: Duane Varbel, Roy Osborn, Robert Bryan and Larry Schmidt. At issue is whether the trials of the co-defendants should be severed where one co-defendant wishes to use the testimony of another co-defendant and affidavits attest that such 685 testimony will be exculpatory, but that it will not be provided unless the co-defendant is tried separately. Three separate motions to sever have been filed. The general rule is that defendants jointly charged are jointly tried. See United States v. Gay, 567 F.2d 916, 919 (9th Cir.), cert. denied, 435 U.S. 999, 98 S.Ct. 1655, 56 L.Ed.2d 90 (1978). This rule applies in conspiracy cases. United States v. Escalante, 637 F.2d 1197, 1201 (9th Cir.), cert. denied, 449 U.S. 856, 101 S.Ct. 154, 66 L.Ed.2d 71 (1980). Fed.R.Crim.P. 14 provided, however, that the trial court may grant a severance when it appears that a defendant would suffer significant prejudice from a joint trial. Whether severance is necessary is a question left to the discretion of the court and will not be reversed without a showing of abuse of discretion. United States v. Ortiz, 603 F.2d 76, 78 (9th Cir.1979), cert. denied, 444 U.S. 1020, 100 S.Ct. 678, 62 L.Ed.2d 652 (1980); United States v. McDonald, 576 F.2d 1350, 1355 (9th Cir.), cert. denied, 439 U.S. 830, 99 S.Ct. 105, 58 L.Ed.2d 124 (1978). The test for determining whether the trial court abused its discretion is whether a joint trial was so prejudicial as to require the trial judge to exercise his discretion in but one way. United States v. Arbelaez, 719 F.2d 1453 at 1460 (9th Cir.1983); United States v. Escalante, 637 F.2d at 1201; United States v. Adams, 581 F.2d 193, 198 (9th Cir.1979), cert. denied, 439 U.S. 1006, 99 S.Ct. 621, 58 L.Ed.2d 683 (1978). The burden for demonstrating prejudice rests on the defendant and is a heavy one. He must show more than that a separate trial might offer "a better chance" of acquittal. Id. at 198. The court must balance the burden and cost of a separate trial against the possible prejudice to the defendant. United States v. Sears, 663 F.2d 896, 900 (9th Cir.1981), cert. denied, 455 U.S. 1027, 102 S.Ct. 1731, 72 L.Ed.2d 148 (1982). The problem of severance arises because one defendant may not require another defendant to testify in his behalf and thereby conflict with the privilege of a criminal defendant not to incriminate himself. If a defendant does testify, he waives his privilege not to answer questions about the crime charged. 1 Wright & Miller, Federal Practice and Procedure: Criminal § 225 (2d ed. 1982). Thus a co-defendant who does not wish to testify on his own behalf will be unlikely to testify on behalf of a co-defendant. Id. The majority of courts deny such severance, questioning whether the defendant would actually call his co-defendant if he could, and whether the co-defendant would not claim his constitutional privilege even in a separate trial. Id.; see, United States v. Gay, 567 F.2d at 919. As a result, courts have demanded "more than conclusory statements about the nature of the expected testimony." 1 Wright & Miller, Federal Practice and Procedure: Criminal § 225 (2d ed. 1982). The following factors are cited as significant in the Court's weighing as to whether a motion to sever co-defendants should be granted: That the defendant would call the co-defendant at a separate trial, that the co-defendant would testify, and that the testimony would be favorable to the moving party. United States v. Haro-Espinosa, 619 F.2d 789, 793 (9th Cir.1979); United States v. Vigil, 561 F.2d 1316, 1317 (9th Cir.1977). The degree to which the testimony would be exculpatory. United States v. Boscia, 573 F.2d 827, 832 (3d Cir.), cert. denied, 436 U.S. 911, 98 S.Ct. 2248, 56 L.Ed.2d 411 (1978). The good faith of the defendant's intent to have a co-defendant testify. United States v. Kaplan, 554 F.2d 958, 966 (9th Cir.), cert. denied, 434 U.S. 956, 98 S.Ct. 483, 54 L.Ed.2d 315, rehearing denied, 434 U.S. 1026, 98 S.Ct. 755, 54 L.Ed.2d 774 (1977). The possible weight and credibility of the predicted testimony. Id. The probability that such testimony will materialize. Id. The economy of a joint trial. Id. 686 The possibility that the trial strategy of a co-defendant will prejudice the defendant seeking severance. Id. In the most recent Ninth Circuit discussion of this issue, the court, citing Kaplan, states that although a defendant asserts that co-defendants would present exculpatory testimony at a separate trial such severance will be denied if the defendant "never furnished the court with any representations from co-defendants' counsel either confirming their client's willingness to take the stand and or describing the nature of the exculpatory testimony." United States v. Arbelaez, 719 F.2d 1453 at 1460 (9th Cir.1983). Although the court did not expand on the issue, it is clear that defendant there did neither, and the district court's denial of severance was affirmed. Affidavits of Counsels for Defendants and Affidavit of Defendant Roy Osborn The affidavit of Roy Osborn in support of the motions for severance of defendants states in pertinent part: That Osborn will "provide exculpating information and testimony" for all co-defendants "if and only if my testimony is requested in a proceeding in which I am not a defendant nor in jeopardy." That George Sterling, Osborn's attorney, will provide the same type of testimony on behalf of all defendants only if Osborn agrees to waive his attorney-client privilege, and that Osborn will waive such only if the trials are severed. That George Sterling's sworn statement, given to the United States Attorney in August 1983, establishes and supports the basis for Osborn's affidavit. The affidavit of George Sterling provides in pertinent part as follows: That Sterling will testify he advised Osborn to tape the government agents at issue in this matter. That Sterling will testify that through Osborn and direct conversations with Varbel, that Varbel was aware that the defendants were "in fact agents and provocators" and that Varbel's awareness of this occurred prior to Osborn's and Sterling's involvement. That Sterling will testify "if called as a witness" that when Osborn introduced the agents to defendants Bryan and Schmidt, Osborn knew that the clients/agents were in fact agents and this would be exculpatory by "laying the necessary foundation for a claim of entrapment defense" and a due process violation. Varbel's attorney, Gary Thomas, provides the following avowals by affidavit: That Varbel needs the testimony of Osborn. That Varbel will call Osborn at a severed trial. That Osborn would testify at a severed trial. That Osborn's testimony would be favorable to Varbel given Osborn would testify that (1) Varbel told Osborn that Rex Reynolds and others were federal authorities, (2) that there was no conspiracy to commit any offenses, (3) that Varbel received no funds from federal agents or from Osborn, and (4) that Varbel did not know and never met co-defendants Bryan and Schmidt. Bryan and Schmidt's attorney, Donald W. MacPherson, attests to the following by affidavit in support of the motions to sever: That Osborn and Sterling assured him they will testify for his clients and that MacPherson will call them as witnesses. That Osborn and Sterling will offer testimony "they believe to be exculpatory" and that MacPherson also believes the same. That Osborn and Sterling will make an offer of proof of their testimony in camera to avoid revealing defense strategies and tactics. That Osborn and Sterling's testimony is critical to the defense of his clients and they will be "seriously prejudiced" if no severance is granted. Analysis The critical issue here is not whether Osborn is willing to testify or whether 687 he will be called to do so by his co-defendants. Rather, the issue is whether his testimony will be sufficiently exculpatory to justify severance. It seems clear that the factors as set forth in Kaplan and the other cases cited above, imply that careful evaluation of the credibility and weight of the potential exculpatory testimony is only possible where the substance and effect of such can be determined. Osborn's affidavit broadly states that his testimony will be "exculpating" and points to Sterling's affidavit to establish and support the basis for the severance. Osborn provides no specifics as to what the nature of his testimony would be. If we rely on Sterling's sworn statement to the government, as Osborn suggests, we are left to assume that Osborn would say that Varbel had told him that he was "suspicious" that the clients might be agents because they had "walked in off the street" and "had all this money, and wanted to set up a foreign corporation." Sterling's sworn statement at pages 25-27. At another point, Sterling states that Varbel was "not saying enough right to protect himself." Id. at 37. Later, Sterling states that "the assurance we had was that Duane was playing games with them, he wasn't going to take the money, he wasn't going to do anything. He was just dragging it," Id. at 40, and that they thought ninety percent it was a setup and laughed about it with Varbel. Id. at 48-51. The Court is unwilling to assume that these specific statements of Sterling's are the exact exculpatory testimony which Osborn would provide. This leaves the Court in the position of having to first decipher the meaning of some of Sterling's statements, and second, to determine which of his statements are also those which Osborn will testify to. Further, a fair reading of the Sterling transcript is that Osborn could potentially provide testimony that Varbel had a ninety percent suspicion that the clients were really agents and that Varbel was merely "playing games" with the agents. Id. at 40. Such testimony would apparently attempt to support the defense referred to by Sterling in oral argument on pretrial motions to the effect that defendants knew the clients were really agents, but they merely played along with them. The significance of such testimony as exculpatory evidence, even if given by Osborn, is not certain, as it does not rise to the level of showing that Varbel was not involved in the conspiracy. Such testimony is not so clearly exculpatory as to outweigh the judicial economy of a joint trial. In addition, the weight and credibility of such testimony is questionable. Antagonistic Defenses Osborn argues that "apparent or real" antagonism of defenses between co-defendants may compel a severance of all defendants. See Osborn's Motion to Sever Charges and/or Defendants: Prejudicial Joinder, at p. 12. He cites no law to support this contention. It appears settled that the mere presence of hostility between co-defendants, or the desire of each co-defendant to avoid conviction by placing the blame on the other does not require severance. United States v. Brady, 579 F.2d 1121, 1128 (9th Cir.1978), cert. denied, 439 U.S. 1074, 99 S.Ct. 849, 59 L.Ed.2d 41 (1979). In United States v. Berkowitz, 662 F.2d 1127, 1134 (9th Cir.1981), the court concluded that defenses are antagonistic if they are mutually exclusive and that severance would be required in such a circumstance "if the jury, in order to believe the core of testimony offered on behalf of (one) defendant, must necessarily disbelieve the testimony offered on behalf of his co-defendant." Defendants have provided the Court with no evidence to believe that defenses are sufficiently antagonistic to justify severance. Guilt by Association Defendants claim that severance is warranted because they will be unfairly prejudiced by any showing of more substantial evidence against one than against another. However, showing that a defendant would have a better chance of acquittal *688 if tried separately is not sufficient. 662 F.2d at 1132. This is true for persons charged in a conspiracy, even though one defendant's role in the alleged offense may have been minor or the evidence against a co-defendant more damaging. A co-conspirator is vicariously liable for all of the acts of another conspirator even though he may not have directly participated in those acts so long as those acts are committed pursuant to and in furtherance of the conspiracy. United States v. Basey, 613 F.2d 198, 202 (9th Cir.1979), cert. denied, 446 U.S. 919, 100 S.Ct. 1854, 64 L.Ed.2d 274 (1980); United States v. Saavedra, 684 F.2d 1293 (9th Cir.1982). The defendants here have not met their burden of showing that without severance they would be denied a fair trial. United States v. Sears, 663 F.2d at 901. Accordingly, IT IS ORDERED that all motions to sever co-defendants are denied.	{ "pile_set_name": "FreeLaw" }
540 U.S. 846 ALVAREZ-MENDOZAv.UNITED STATES andMARTINEZ-SANCHEZ, AKA MARIN, AKA MARIN-OLIVAREZ, AKA CASTANEDAv.UNITED STATES. No. 02-10965. Supreme Court of United States. October 6, 2003. 1 Appeal from the C. A. 5th Cir. 2 Certiorari denied. Reported below: 61 Fed. Appx. 922 (first judgment) and 923 (second judgment).	{ "pile_set_name": "FreeLaw" }
Skip to main content	{ "pile_set_name": "FreeLaw" }
Slip Op. 04 - 148 UNITED STATES COURT OF INTERNATIONAL TRADE : HUAIYANG HONGDA DEHYDRATED : VEGETABLE CO., : : Plaintiff, : : v. : Before: MUSGRAVE, JUDGE : UNITED STATES, : Court No. 03-00636 : Defendant, : : and : : FRESH GARLIC PRODUCERS ASS’N, : CHRISTOPHER RANCH, L.L.C., FARM GATE, : L.L.C., THE GARLIC CO., VALLEY GARLIC, : and VESSEY AND CO., : : Defendant-Intervenors. : : [On challenge by producer/exporter to decision of U.S. Department of Commerce to rescind administrative review of same, judgment for the defendant.] Decided: November 22, 2004 deKieffer & Horgan (J. Kevin Horgan), for the plaintiff. Peter D. Keisler, Assistant Attorney General; David M. Cohen, Director, Jeanne E. Davidson, Deputy Director, Civil Division, Commercial Litigation Branch, United States Department of Justice, (Stefan Shaibani); and Office of Chief Counsel for Import Administration, U.S. Department of Commerce (Scott D. McBride), of counsel, for the defendant. Collier Shannon Scott, PLLC (Michael J. Coursey), for the defendant-intervenors. Court No. 03-00636 Page 2 OPINION In this action, Huaiyang Hongda Dehydrated Vegetable Company (“Hongda”), a producer or exporter of fresh garlic from the People’s Republic of China (PRC), contends the International Trade Administration of the U.S. Department of Commerce (“Commerce”) improperly rescinded the annual administrative review of the antidumping order on importations of garlic from the PRC that was initiated prior to completion of Hongda’s new shipper review. See Fresh Garlic From the People’s Republic of China: Partial Rescission of Antidumping Duty Administrative Review, 68 Fed. Reg. 46580 (Aug. 6, 2003). See also Antidumping Duty Order: Fresh Garlic From the People’s Republic of China, 59 Fed. Reg. 59209 (Nov. 16, 1994). Alternatively, Hongda complains that the 376.67% country-wide dumping margin from the 1994 investigation has been discredited and therefore its continued application to Hongda is arbitrary, capricious and otherwise not in accordance with law. However, the Court sustains the rescission of the administrative review and concludes that it lacks jurisdiction to hear argument on the continued viability of the 1994 country-wide margin. Background During the anniversary month of publication of an antidumping duty order, a domestic interested party with respect to named exporters and producers covered by the order, and an exporter, producer or importer with respect to subject merchandise entered during the relevant period of review, may request Commerce to conduct an administrative review. See 19 U.S.C. § 1675(a)(1); 19 C.F.R. § 351.213(b). See also 19 U.S.C. § 1677(9) (“interested party” defined). In addition to assessment on entries during the period of review, administrative review establishes a new cash deposit rate on future entries of subject merchandise. See 19 U.S.C. § 1675(a)(2)(C). Court No. 03-00636 Page 3 The administrative record reveals that Commerce published a notice of opportunity to request an annual administrative review of the antidumping order in the Federal Register on November 1, 2002, before the preliminary results of Hongda’s new shipper review had been completed.1 The domestic industry petitioners then requested review of several respondents including Hongda, and the administrative review was initiated on December 26, 2002. See R 3; R 5.2 Hongda did not at the time submit a similar request. After initiation of the review, the domestic industry petitioners submitted a memorandum to Commerce alleging that they had uncovered “massive” under-reporting of U.S. sales by Hongda and two other respondents. See R 49 (Apr. 1, 2003); Confidential Administrative Record Document 6 (Apr. 1, 2003). The petitioners compared import statistics with information3 on the three respondents including Hongda which accounted for “virtually” all of the imports of garlic from the PRC during the relevant period and alleged that two and a half times the amount of garlic from the PRC had entered the U.S. during the time as compared with what had been reported. Id. at 2. They 1 Cf. Antidumping or Countervailing Duty Order, Finding or Suspended Investigation: Opportunity to Request Administrative Review, 67 Fed. Reg. 66612 (Nov. 1, 2002), Administrative Record Document (“R”) 1 (covering the period Nov. 1, 2001 to Oct. 31, 2002); Fresh Garlic from the People’s Republic of China: Rescission of New Shipper Antidumping Review and Initiation of New Shipper Antidumping Duty Review, 67 Fed. Reg. 44594 (July 3, 2002) (covering the period Nov. 1, 2001 to Apr. 30, 2002). 2 Initiation of Antidumping and Countervailing Duty Administrative Reviews, 67 Fed. Reg. 78772 (Dec. 26, 2002). In light of the period covered by the new shipper review, the administrative review of Hongda would have examined Hongda shipments between May 1, 2002 and October 31, 2002. 3 The domestic industry’s allegation with respect to Hongda was based upon certain information submitted at the new shipper review. Court No. 03-00636 Page 4 therefore requested that Commerce, in consultation with the (former) U.S. Customs Service,4 investigate further and apply adverse inferences if indeed these respondents had under-reported. See id. at 11. It appears that the petitioners, still desiring investigation, re-alleged under-reported sales and transhipment soon thereafter. Cf. R 55 (Apr. 18, 2003) (Commerce memo to file). At the time, Commerce had not received Hongda’s response to the antidumping questionnaire. On the other hand, Commerce had sent the questionnaire addressed to Hongda via its counsel for the new shipper review. See R 7 (Dec. 30, 2002). In early April, Commerce learned that such counsel had not been retained to represent Hongda at the administrative review. See R 56 (Apr. 22, 2003) (Commerce memo to file). It therefore sent the questionnaire directly to Hongda in the PRC. R 57 (Apr. 23, 2003). Four days later, the domestic industry petitioners requested rescission of the administrative review of Hongda. R 61 (Apr. 28, 2003). The petitioners did not properly serve Hongda with a copy of this withdrawal. See Pl.’s Br., App. 7 at 2. Cf. R 61 at 5. Commerce did not immediately act on the domestic industry’s request. It did, however, immediately publish the preliminary new shipper review results for Hongda the following day. Fresh Garlic from the People's Republic of China: Preliminary Results of Antidumping Duty New Shipper Review, 68 Fed. Reg. 22676 (Apr. 29, 2003). The results relied upon adverse facts available to impose against Hongda the PRC-wide rate of 376.67 percent, a rate in effect since 1994 that was based upon information contained in the petition “corroborated for the preliminary results of the first 4 The U.S. Customs Service was reorganized into the United States Bureau of Customs and Border Protection pursuant to the Homeland Security Act of 2002, Pub. L. No. 107-296 § 1502, 2002 U.S.C.C.A.N. (116 Stat.) 2135, 2308, effective March 1, 2003. See Reorganization Plan Modification for the Department of Homeland Security, H.R. Doc. No. 108-32 at 4 (2003). Matters relating to customs fraud crimes were ultimately organized into the U.S. Bureau of Immigration and Customs Enforcement (“BICE”). See H.R. Rep. No. 37, 108th Cong., 1st Sess. 2003. Court No. 03-00636 Page 5 administrative review” as well as “corroborated in subsequent reviews to the extent that the Department noted the history of corroboration[.]” Id. at 22679-80. The final new shipper review results followed nearly two months later and reiterated the viability of the 1994 country-wide rate for Hongda. Fresh Garlic From the People’s Republic of China: Final Results of Antidumping Duty New Shipper Review, 68 Fed. Reg. 36767 (June 19, 2003) (“New Shipper Results”). A month afterwards, Hongda asserted an interest in proceeding with the instant administrative review, which by this time was approximately eight months after initiation. On July 24, 2003, about a week after filing its notice of appearance, Hongda’s counsel met with Commerce officials and purportedly urged continuation of the administrative review due to information that had come to Hongda’s attention and that of certain U.S. sureties acting on behalf of certain U.S. importers. See R 112 (July 25, 2003) (Commerce memo to file); R 107 (July 18, 2003) (notice of appearance). Specifically, in written comments submitted on July 29, 2003, Hongda explained that it opposed rescission of the administrative review on the ground that two fraudulent schemes designed to evade antidumping duties on imports of Chinese agricultural products had been uncovered and that these particularly implicated Hongda’s customs and potential antidumping duty liabilities. R 113 (July 29, 2003). Allegedly, certain producers or exporters had been making entries of garlic using Hongda’s name and its import bond which had been posted as security during the pendency of the new shipper review for any ultimate antidumping duty liability. Id. See 19 C.F.R. § 351.214(e). Therefore, Hongda argued, continuing the administrative review afforded the opportunity to identify legitimate and illegitimate garlic shipments, develop solutions for curtailing the fraudulent abuse of its antidumping reviews with respect to China, and resurrect public Court No. 03-00636 Page 6 confidence in the proper administration of Chinese agricultural imports. Id. The domestic industry, however, urged Commerce to proceed with rescission with respect to Hongda the same day. R 115 (July 29, 2003) (Commerce memo to file). Commerce immediately reported Hongda’s allegations of import fraud to the “Chief of the Other Government Agency Branch” of Customs and Border Protection. R 120 (Aug. 1, 2003). Nonetheless, Commerce rescinded the administrative review of Hongda shortly thereafter. Fresh Garlic From the People’s Republic of China: Partial Rescission of Antidumping Duty Administrative Review, 68 Fed. Reg. 46580 (Aug. 6, 2003). The public notice of Commerce’s determination stated that rescission of the administrative review was appropriate because customs fraud is within the “statutory purview” of the Bureau of Immigration and Customs Enforcement rather than Commerce, that the domestic industry petitioners had withdrawn their request, that Commerce had not expended significant resources on the review to date, and that Hongda itself had not properly requested the administrative review or had otherwise participated in it until recently. One day later, Commerce extended the deadline for the preliminary administrative review results of the remaining respondents until October 31, 2003. See Fresh Garlic From the People’s Republic of China: Notice of Extension of Time Limit for the Preliminary Results of Antidumping Duty Administrative and New Shipper Reviews, 68 Fed. Reg. 47020 (Aug. 7, 2003). This action followed. Jurisdiction and Standard of Review Jurisdiction is alleged pursuant to 19 U.S.C. § 1516a(a)(2)(B)(iii) and 28 U.S.C. § 1581(c). A decision by the administering authority to rescind a particular administrative review must be supported by substantial evidence and be in accordance with law. See 19 U.S.C. § 1516a(b)(1)(B)(i). Court No. 03-00636 Page 7 Discussion Monthly over the past twenty years, Commerce has published the outstanding orders with anniversary dates for the particular month. The practice amounts to clear notification to all potential interested parties of the opportunity to request an administrative review, as well as indication of Commerce’s preference to have all parties interested in proceeding with administrative review submit a written request for same in response to the published notice. See Ferro Union, Inc. v. United States, 23 CIT 178, 182, 44 F.Supp.2d 1310, 1316 (1999) (discussing Potassium Permanganate from the People’s Republic of China, 59 Fed. Reg. 46035 (Sep. 6, 1994)). Once a request for administrative review is submitted, it may be withdrawn, and the administrative review rescinded, within 90 days of the published notice of opportunity, although Commerce “may extend this time limit if the Secretary decides that it is reasonable to do so.” 19 C.F.R. § 351.213(d)(1). Cf. Fuyao Glass Indus. Group Co. v. United States, 27 CIT ___, Slip Op. 03-99 at 7 (July 31, 2003), (during first 90 days the party requesting administrative review controls whether review is to proceed, if no other party also requests review) with Sugiyama Chain Co. v. United States, 18 CIT 423, 430, 852 F. Supp. 1103, 1110 (1994), aff’d 60 F.3d 843 (Fed. Cir. 1995) (Commerce has the discretion to accept or reject an interested party’s withdrawal of its request for an administrative review pursuant to 19 U.S.C. § 1675(a)(1)). The dispute here concerns this latter provision. I Approximately eight months after initiation of the administrative review it was rescinded because Commerce had “not committed significant resources to date” and the “petitioners were the only party to request an administrative review” of Hongda. 68 Fed. Reg. at 46581. Hongda had not Court No. 03-00636 Page 8 complied with the formality of responding to the published notice of opportunity, but at this stage it argues that Commerce’s decision was unreasonable when considered against the following: (1) it was not until April 23, 2003, that Commerce finally sent its questionnaire directly to Hongda; (2) the questionnaire was untranslated and no Hongda personnel are fluent in English; (3) Hongda did not at the time have legal counsel for the administrative review; (4) five days after Commerce properly sent the questionnaire to Hongda in the PRC (April 28, 2003), the domestic industry petitioners withdrew their request for administrative review, which was 123 days after the notice of initiation was published (i.e., the day before Commerce published the preliminary new shipper review results); and (5) after Hongda retained counsel on July 18, 2003, counsel immediately contacted Commerce and met with Commerce officials on July 24, 2003 and declared Hongda’s willingness to fully participate in the administrative review. Hongda further argues that Commerce’s decision was unreasonable since it ignored the alleged import fraud which bears on the magnitude of Hongda’s antidumping duty liability. Pl.’s Br. at 7-8. Most of Hongda’s points appear directed toward argument that it had inadequate notice of the administrative review. The Court is sympathetic, but the position is ultimately untenable, for several reasons. First, Hongda requested and participated in a new shipper review, which, like an administrative review, is conducted pursuant to section 751 of the Tariff Act of 1930, as amended. 19 U.S.C. § 1675. Cf. 19 C.F.R. §§ 351.214(b) & 351.221(c). Initiation of either type of review is dependant upon knowledge of the anniversary date of the order. See 19 C.F.R. §§ 351.213(b), 351.214(d), 351.221(c)(1). Having thus participated in a new shipper review, Hongda cannot persuasively disclaim imputed knowledge of Commerce’s administrative review policies and Court No. 03-00636 Page 9 procedures. Furthermore, prior involvement in antidumping duty proceedings concerning the same subject merchandise gives rise, a fortiori, to an interest in monitoring for publication of the annual notice of opportunity to request review. Cf. Fed. Crop Ins. Corp. v. Merrill, 332 U.S. 380, 385, 68 S.Ct. 1, 3 (1947) (promulgated regulations were binding on all who sought to come within the Federal Crop Insurance Act regardless of actual knowledge of the regulations or “the hardship resulting from innocent ignorance”). Second, as a general matter, publication in the Federal Register “is sufficient to give notice of the contents of the document to a person subject to or affected by it.” 44 U.S.C. § 1507. See, e.g., Lyng v. Payne, 476 U.S. 926, 942-43, 106 S.Ct. 2333 (1986); Stearn v. Dep’t of the Navy, 280 F.3d 1376, 1384 (Fed. Cir. 2002); Aris Gloves, Inc. v. United States, 281 F.2d 954 (CCPA 1958), cert. denied, 82 S.Ct. 398, 368 U.S. 954 (1962); Cathedral Candle Co. v. U.S. Intern. Trade Com’n, 27 CIT __ n.10, 285 F.Supp.2d 1371 n.10 (2003). While it may be true that constructive notice in the Federal Register of a hearing or opportunity to be heard is geographically explicit only “to all persons residing within the States of the Union and the District of Columbia”5 and also that there may also be instances where notice by publication is insufficient as a matter of law, “[t]he purpose of the Federal Register Act was to give notice to industry, to general business, or to the people of the country as a whole, of certain action taken by the President under a power granted to him by the Congress, so that such industry, business or the people might have notice of such action and act accordingly.” Aris Gloves, 281 F.2d at 957-958 (quoting Toledo, P. & W.R.R. v. Stover, 60 F.Supp. 587, 596 (N.D. Ill. 1945)). All industries or businesses availed of the “substantial privilege” of doing 5 See 44 U.S.C. § 1508. Court No. 03-00636 Page 10 business within the United States are chargeable with knowledge of its laws and the manner of their execution to maintain public order. Cf. Exxon Corp. v. Wisconsin Dep’t of Revenue, 447 U.S. 207, 100 S.Ct. 2109 (1980) (taxation nexus); Pensacola Telegraph Co. v. Western Union Telegraph Co., 96 U.S. 1, 6 Otto 1 (1877) (national privilege is quid pro quo for acceptance of national terms). Third, even imperfect notice does not, necessarily, void agency action undertaken pursuant thereto. See Brock v. Pierce County, 476 U.S. 253, 106 S.Ct. 1834 (1986); Intercargo Ins. Co. v. United States, 83 F.3d 391, 396 (Fed. Cir. 1996); Kemira Fibres Oy v. United States, 61 F.3d 866 (Fed. Cir. 1995). The question, essentially, is whether a plaintiff has been substantially prejudiced by the imperfect notice. E.g., Intercargo. One may, in fact, be apprized of circumstances amounting to actual or implied notice of the matter invoked by the agency. See United States v. Elof Hansson, Inc., 296 F.2d 779, 48 CCPA 91 (1960); Hoenig Plywood Corp. v. United States, 51 Cust. Ct. 336, RD 10569 (1963). Here, it is undisputed that counsel, while representing Hongda at the new shipper review, received the original administrative review questionnaire that Commerce intended to serve upon Hongda. If the transmission of that questionnaire by Commerce to counsel was erroneous, it is understandable. Counsel apparently continued to appear on the service list maintained by the Central Records Unit. See 19 C.F.R. § 351.103(c). See, e.g., R 3. Counsel did not alert Commerce to the “error” at the time. It took a further three months and Commerce’s initiative to discover that counsel’s representation of Hongda did not, at least at the time, extend to the administrative review proceeding. And during that time, counsel’s silence furthered the impression that they represented Hongda in successive segments of the administration of the dumping order. Counsel do not comment further on the document’s disposition, but assuming receipt of the questionnaire elicited counsel’s surprise, they had three choices: return it, forward it, or ignore it. Court No. 03-00636 Page 11 The ABA Model Rules of Professional Conduct do not specifically require counsel to forward or disclose receipt of arguendo extraneous matter to a client, but neither do they suggest ignoring it.6 Whether counsel had a duty to notify the client of the existence of the questionnaire (or, for that matter, to notify Commerce) depended not upon whether the questionnaire pertained to a matter within the scope of the representation, but rather upon whether silence had the potential to bring about “substantial prejudice” to Hongda. If it was not a matter within the scope of representation, then ignoring it might serve a tactical purpose, e.g. subsequently being able to claim improper notice and thereby defeating jurisdiction. In accordance with the foregoing, however, that would at best have been an open question at the time, and the Model Rules, in keeping with the Model Code, essentially advise “when in doubt, confer.” Truly, the exercise of that discretion ultimately rests with counsel, but to the extent Commerce considered that counsel’s receipt of the administrative review questionnaire without apparent further activity mitigated in favor of finding constructive or implied notice in Hongda,7 such consideration was not an abuse of discretion. 6 Model Rule 1.4 of the ABA Model Rules of Professional Conduct, for example, implores counsel to “keep the client reasonably informed about the status of a matter” and “explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation[,]” id. at (a)(3) & (b), and Model Rule 1.2(c) allows counsel to “limit the objectives of the representation if the client consents after consultation.” Similarly, under the ABA Model Code of Professional Responsibility, Canon 6 spoke on providing competent representation to the client. Counsel aspired, pursuant to EC 6-4, to “safeguard the interests of a client,” but are obligated, pursuant to DR 6-101(A)(3), not to neglect a legal matter “entrusted” to them. EC 7-7 reiterated that it is the client who is responsible for making decisions but entitled counsel to make decisions “not affecting the merits of the cause or substantially prejudicing the rights of a client.” DR 7-101(A)(3) admonished counsel not to intentionally “prejudice or damage the client during the course of the professional relationship.” 7 On the subject of notice, Hongda also complains that the domestic industry did not properly serve it with a copy of their request to withdraw their administrative review request. The point does (continued...) Court No. 03-00636 Page 12 Nor was it an abuse of discretion for Commerce to conclude that Hongda’s opposition to rescission and its belated expression of interest in the completion of the administrative review were not on par with a proper written request for administrative review. Hongda’s silence subsequent to the review’s initiation cannot reasonably be construed as reliance upon the request of another as an expression of interest that the administrative review be conducted. Even if it could, such reliance places one at a disadvantage in arguing that an administrative review should continue if the other withdraws its request, as this matter demonstrates. The record is devoid of any (other) indicia of detrimental reliance, and the Court must defer to Commerce’s reasonable policy of having each interested party desiring initiation of an administrative review submit a separate written request to that effect. Commerce might well have wondered why it was suddenly confronting tactical volte face by both parties late in the proceeding. In the final analysis, what appears to have tipped the balance for Commerce was the fact that Hongda had, apparently, been dilatory in asserting its interests. At this stage, even considering the matter in a light most favorable to Hongda, fifty-five days had elapsed between the time Commerce sent the questionnaire to Hongda directly and the time that it finally retained legal counsel to represent it at the administrative review proceeding. Hongda does not here adequately explain why it took nearly two months to initiate contact with Commerce to declare that it wanted to “fully participate.” Instead, Hongda offers for consideration Ferro Union, supra, 23 CIT 7 (...continued) not address the impression that Hongda did not properly request or otherwise participate in the administrative review when the opportunity to do so presented itself, nor does it demonstrate substantial prejudice to Hongda since Commerce did not, as above observed, immediately act upon the domestic industry’s request but waited a further 55 days before deciding to rescind during which time Hongda had the opportunity to fully express its opposition to recision to Commerce. Court No. 03-00636 Page 13 178, 44 F.Supp.2d 1310, which stated that “the legislative history of 19 U.S.C. 1675(a) indicates that Congress intended to limit reviews in which no one had an interest, and Commerce should rightly continue a review in which there is an expressed interest.” Pl.’s Br at 8 (quoting 23 CIT at 181, 44 F.Supp.2d at 1315). Hongda also draws attention to the statement that in administrative reviews “involving multiple parties, Commerce has only granted termination when no other party objected to the termination.” Id. (quoting 23 CIT at 182, 44 F.Supp.2d at 1316). It is worthwhile for this Court to agree, even emphasize again, that “Commerce should rightly continue a review in which there is an expressed interest,” but the matter here is not considered pursuant to a de novo standard of review. Ferro Union imposes no limitation on Commerce’s consideration of a withdrawal of interest in an administrative review by the interested party which requested it. Rather, the case sustained Commerce’s decision to reject an attempt by the domestic steel industry to terminate that administrative review, and the reference in Ferro Union to reviews “involving multiple parties” addresses the situation of multiple properly-submitted written requests for administrative review. That is not the situation here, which is rather analogous to Potassium Permanganate from the People’s Republic of China, supra, 59 Fed. Reg. 46035. As in that matter, also described in Ferro Union, Commerce has rescinded an administrative review over the objection of a respondent which has not filed its own request for administrative review. See 23 CIT at 182, 44 F.Supp.2d at 1316. Commerce’s decision to rescind administrative review of Hongda is therefore not without precedent. Lastly, Hongda takes issue with Commerce’s determination to rescind despite the fact that “Hongda and several importers expressed concerns pertaining to the rescission of the administrative review of Hongda[.]” That, to say the least, is an understatement: the determination to rescind was Court No. 03-00636 Page 14 predicated in part on reasoning that “the arguments they presented [in opposition to recision] pertain to allegations involving fraud.” 68 Fed. Reg. at 46581. The government concurs that the Bureau of Immigration and Customs Enforcement, not Commerce, is statutorily assigned the task of investigating customs fraud. See 19 U.S.C. § 1592. Hongda pleads that the very assertion of fraud rendered the decision unreasonable. Specifically, Hongda argues that “[i]t is in the public’s best interest to investigate this claim prior to ordering recision[,]” that as a matter of fundamental fairness it “should be allowed to participate in the review so that [Commerce] could accurately calculate any potential dumping margin”, and that the mere assertion of fraud and Hongda’s expression on interest in fully participating in the administrative review rebutted any presumption that rescission with respect to Hongda would be reasonable.8 However, Hongda does not show how the alleged fraud affected the margin that was applied to it. In fact, there is no connection (see infra). To the extent that the government’s rationale implies that import fraud is irrelevant to an administrative review, such a position is unacceptable, due to the potential for skewed review results. Nevertheless, Commerce’s position here appears to be that import fraud per se is not, without more, a sufficient reason to require that an administrative review proceed in the face of withdrawal of interest in the review by the sole party that properly requested it. Thus, Commerce essentially reasoned that whether the public interest is served by the investigation of customs fraud, proceeding with an administrative review in the first place depends upon an interested party’s timely expression of its interest in it. In this matter, Commerce simply concluded that Hongda’s expression of interest 8 Pl.’s Br. at 7-8. Hongda also notes that the Federal Register notice did not accurately reflect its willingness to fully participate in the administrative review. Court No. 03-00636 Page 15 in the administrative review was belated. On this basis, unfortunately for Hongda, the Court is constrained to conclude that Commerce’s consideration of the opposing arguments and its decision to rescind was not an abuse of discretion since it appears to have substantial supporting evidence on the administrative record. There may be instances where actual participation amounts to such a sufficient expression of interest in completing the administrative review that its recision would be unlawful, but this is not one of them. II Whether Hongda’s allegation of customs fraud is true, its position has not been worsened as a result of the recision of the administrative review. The margin that continued to be applicable as a result of recision, i.e., the new shipper review results, was not determined despite assertion of customs fraud. Nonetheless, Hongda argues that the country-wide margin that was applied to it was not lawfully “determined” since it is merely the country-wide rate from the 1994 investigation. The country-wide rate, Hongda emphasizes, was obtained from the petition and was not corroborated. Commerce is authorized to rely on “facts otherwise available” in making its determinations if it cannot obtain the information directly. It may also derive an adverse inference if a party has been uncooperative. But, whenever Commerce uses “secondary information” rather than information “obtained” in a review, it is required “to the extent practicable” to corroborate that information. Information from a prior segment of an antidumping proceeding is considered secondary information. See generally 19 U.S.C. § 1677e. Commerce interprets the corroboration requirement to mean that secondary information must have “probative value.” See Statement of Administrative Action at 870; Antidumping Duties; Countervailing Duties, 62 Fed Reg. 27296, 27409 (1997). Thus, on this matter Hongda argues the Court No. 03-00636 Page 16 administrative record contains no indicia of corroboration of secondary information, no memoranda evincing any discussions thereon. In the final analysis, Hongda argues, Commerce did not articulate any reasoning in the recision notice to explain why the country-wide rate continues to be probative. However, as the government points out, the only action taken by Commerce that is being challenged is the decision to rescind the review itself with respect to Hongda. Commerce made no decision on the merits. Commerce did not “decide” to apply facts available. See 19 U.S.C. § 1677e(a). The recision of the administrative review merely continued the margin that was already in effect. Accordingly, there was no determination to use a “facts available” figure that would have otherwise required corroboration. The Court therefore concludes that it lacks jurisdiction over Hongda’s claim. Any lack of corroboration in the determination to apply the country-wide figure to Hongda was properly appealable from publication of New Shipper Results, supra, 68 Fed. Reg. 36767. Conclusion For the foregoing reasons, judgment will enter in favor of the defendant. /s/ R. Kenton Musgrave R. KENTON MUSGRAVE, JUDGE Dated: November 22, 2004 New York, New York ERRATA Huaiyang Hongda Dehydrated Vegetable Co. v. United States, Court No. 03-00636, Slip Op. 04- 148, dated November 22, 2004: Footnote 4, delete “ (“BICE”) ”. Page 5, line 21, delete “its”. Footnote 7, second to last line, change “55” to “100”. Page 12, line 14, change “fifty-five” to “86". Page 12, line 17, change “two” to “three”. November 30, 2004	{ "pile_set_name": "FreeLaw" }
United States Court of Appeals For the First Circuit No. 11-1398 LILLIAM DAVILA-FELICIANO, Plaintiff, Appellant, v. PUERTO RICO STATE INSURANCE FUND, ET AL., Defendants, Appellees. APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF PUERTO RICO [Hon. Francisco A. Besosa, U.S. District Judge] Before Boudin, Lipez and Thompson, Circuit Judges. Bámily López Ortiz on brief for appellant. José Fco. Benítez-Mier and Joanna Matos Hicks on brief for appellees. July 3, 2012 Per Curiam. Appellant Lilliam Davila-Feliciano appeals from an order of the District Court for the District of Puerto Rico approving the Clerk's taxation of costs in the amount of $12,690.10 pursuant to Federal Rule of Civil Procedure 54(d)(1) and 28 U.S.C. § 1920. We turn first to Appellees' late presented timeliness argument, presented for the first time in their recently filed supplemental brief. The argument contradicts Appellees' express disavowal in their opening brief of any timeliness and jurisdictional challenges, and the argument falls outside the scope of this court's order directing supplemental briefing. Regardless, the argument also fails as a matter of substance. Davila-Feliciano filed her notice of appeal within 30 days of the district court's entry of the challenged order, and that is all that Federal Rule of Appellate Procedure 4 required in this case. Appellees have cited to no precedent to the contrary. As for the $181.80 in copying costs and $1,425 in deposition transcription costs taxed by the district court, we conclude that, under the circumstances, the district court did not abuse its discretion in approving the Clerk's taxation of those costs. See In re San Juan Dupont Plaza Hotel Fire Litigation, 111 F.3d 220, 228 (1st Cir. 1997) (setting out standard of review). That leaves Davila-Feliciano's challenge to the district court's taxation of $11,083.80 for costs accrued when Appellees commissioned the translation into English of certain written -2- documents filed as exhibits to their motion for summary judgment. We have applied plain error review because Davila-Feliciano failed to present this categorical challenge to the district court. See United States v. Farrell, 672 F.3d 27, 29 (1st Cir. 2012) (setting out plain error review standard and principles regarding its application). In Taniguchi v. Kan Pacific Saipan, Ltd., the Supreme Court recently ruled that costs stemming from the translation of written documents do not qualify as "compensation of interpreters," as that term is used in 28 U.S.C. § 1920(6), and, therefore, may not be taxed as costs against a non-prevailing party. 132 S.Ct. 1997, 2001-07 (2012). We reject any suggestion by Appellees to the effect that Taniguchi is not binding precedent for purposes of this case, and, having brought that precedent to bear on the record in this case, we conclude that Davila-Feliciano has satisfied the plain error standard insofar as the $11,083.80 in translation costs are concerned. In so ruling, we, of course, do not mean to disparage the district court for complying with what, at the time of its ruling, was a somewhat standard practice that did not conflict with Supreme Court precedent, but our "plain error" review requires us to consider the state of the law at present, which, in this case, requires application of Taniguchi. See Farrell, 672 F.3d at 36 (describing proper vantage point for purposes of plain error review). In light of the foregoing, we AFFIRM the portion of the -3- district court's order approving the taxation of $181.80 in copying costs and $1,425 in deposition transcription costs, VACATE the portion of the order approving the taxation of $11,083.80 in costs stemming from the translation of written documents, and REMAND for further proceedings consistent with this judgment. -4-	{ "pile_set_name": "FreeLaw" }
510 U.S. 966 Cullumv.United States. No. 93-5646. Supreme Court of United States. November 8, 1993. 1 Appeal from the C. A. 5th Cir. 2 Certiorari denied. Reported below: 979 F. 2d 210.	{ "pile_set_name": "FreeLaw" }
659 A.2d 1097 (1995) Nancy CARDOSO v. NATIONWIDE MUTUAL INSURANCE COMPANY. No. 94-354-Appeal. Supreme Court of Rhode Island. June 20, 1995. Patricia Watson and Richard Abrams, Abrams & Verri, Providence, for plaintiff. John G. Rallis, Boyer, Reynolds & DeMarco, Providence, for defendant. OPINION SHEA, Justice. This matter came before the Supreme Court on a certified question from the Superior Court pursuant to G.L. 1956 (1985 Reenactment) § 9-24-25 on an agreed statement of facts regarding intra-policy stacking of uninsured-motorist coverage. On April 13, 1993, the plaintiff, Nancy Cardoso (Cardoso), filed a complaint in Providence County Superior Court against the defendant, Nationwide Mutual Insurance Company (Nationwide). Cardoso alleged that she had been seriously injured in a collision with an underinsured motorist. She sought a declaratory judgment that her insurance policy with the defendant would afford her $100,000 in underinsured-motorist coverage. On February 24, 1994, the parties moved jointly for certification of a question regarding the extent of the policy's coverage. The question reads as follows: "Whether Plaintiff, who has paid an additional premium to insure two vehicles, as opposed to the premium charged for one vehicle, may stack her UMBI [underinsured-motorist bodily-injury] coverage." For the following reasons, we answer the certified question in the negative. The plaintiff was injured on April 9, 1991, when she was struck by a vehicle operated by Raymond Jarest while she was walking across Mendon Road in Cumberland, Rhode Island. The plaintiff sustained serious and permanent bodily injuries requiring medical care costing in excess of $100,000. Raymond Jarest's vehicle was insured at the time with liability-coverage limits of $25,000. His insurance company settled with plaintiff for the full amount of that coverage. The plaintiff herself was insured under a policy issued by Nationwide to her parents, Pedro and Janet Cardoso (the Cardosos). That single automobile-insurance policy covered two vehicles the Cardosos owned. The policy provided for uninsured or underinsured-motorist bodily-injury coverage in the amount of $50,000 per person. The Cardosos paid a single premium for underinsured-motorist bodily-injury coverage (UMBI). Under this single policy, the Cardosos had two vehicles listed as insured vehicles. The declaration page of the policy lists the two vehicles with coverages and premiums recited for both, to include comprehensive property damage, bodily injury, and medical payments with separate premium costs for each vehicle. However, under uninsured motorists coverage, there is a single premium listed covering both vehicles in the amount of $97. The UMBI coverage for that 1098 premium was $50,000 per person and $100,000 per occurrence. Nationwide offered the per-person limit of $50,000 in full settlement of all underinsured-motorist claims. The plaintiff has rejected this offer and demands $100,000 from Nationwide, asserting that intra-policy stacking is available to her under the automobile policy her parents have with defendant. The plaintiff specifically seeks to stack the two-vehicle coverage to obtain up to a total of $100,000. The plaintiff argues that although the policy lists only one UMBI premium, the amount of the premium is based on the number of vehicles insured on the policy. She contends that had her parents only wanted UMBI coverage on one vehicle, they would have been charged only $43.10, this figure representing the semiannual premium for UMBI coverage for one vehicle as opposed to the $97 premium for more than one vehicle. By not allowing plaintiff to stack coverage, plaintiff contends, defendant is violating the intent of G.L. 1956 (1989 Reenactment) § 27-7-2.1(c), as amended by P.L. 1990, ch. 340, § 1. In addition plaintiff argues that because of the higher premium charged for more than one vehicle, an insured may reasonably expect to have coverage up to the aggregate sum of the vehicles being insured. Lastly, plaintiff contends that the mere form of the premium should not be allowed to defeat the intent of the statute, which she asserts is to protect individuals, such as herself, against economic losses caused by uninsured negligent motorists. The defendant contends that § 27-7-2.1(c) is clear in its language and provides for stacking only when an insured has paid two or more separate premiums for uninsured or underinsured coverage. The defendant's position correctly interprets our stacking statute. The defendant relies on DePalma v. Metropolitan Property and Liability Insurance Co., 615 A.2d 1019 (R.I. 1992), where this court held that an insured could not stack coverage because he had paid only one uninsured-motorist premium for multiple vehicles. The defendant also disputes plaintiff's "reasonable expectations" arguments and points out to the court that the Cardosos had no knowledge of defendant's underwriting calculations when they purchased the policy. Therefore, they contend, it stands to reason that they could not have known that they were paying a higher premium for uninsured-motorist coverage for two vehicles than they would have been paying on one vehicle. The plaintiff's interpretation of § 27-7-2.1(c) is erroneous. The statute at issue is now found at G.L. 1956 (1994 Reenactment) § 27-7-2.1(i). The redesignation of subsection (c) as subsection (i) in the 1994 Reenactment does not change the statutory language. The statutory language of § 27-7-2.1(i) provides: "Whenever an insured has paid two (2) or more separate premiums for uninsured motorists' coverage in a single policy of insurance or under several policies with the same insurance company, the insured shall be permitted to collect up to the aggregate amount of coverage for all of the vehicles insured, regardless of any language in the policy to the contrary." This amendment was added in 1987 after this court ruled in Constant v. Amica Mutual Insurance Co., 497 A.2d 343 (R.I. 1985), that the insureds were not entitled to stack the uninsured-motorist benefits of their two separate policies when the policies had specific language prohibiting stacking. Despite the fact that the insureds in Constant had paid two separate premiums, this court ruled that the policy's unambiguous limit-of-liability clause "conveys most clearly * * the maximum limit [that the insurer will pay] regardless of the number of * * * vehicles or premiums shown'" on the declarations page. Id. at 345. Since the 1987 amendment, insurance companies have begun charging a single premium for UMBI coverage regardless of the number of vehicles insured. In fact, this court has ruled several times that in situations in which a single premium is paid, regardless of the number of vehicles insured, no stacking of uninsured-motorist coverage is allowed. Bazar v. Pennsylvania General Insurance Co., 657 A.2d 1070 (R.I. 1995); DePalma v. Metropolitan Property and Liability Insurance Co., 657 A.2d 1019 (R.I. 1992). In DePalma the insureds had paid a single premium for UMBI coverage on two vehicles *1099 This court held that "the trial justice was correct in holding that stacking of coverage was neither required by statute nor permitted by the policy in light of the fact that only a single premium was paid." 615 A.2d at 1019. In Bazar the plaintiffs paid a single premium to provide uninsured-motorist coverage for three vehicles. As in the instant case the premium charged for multivehicle policies was higher than the premium would have been for a single vehicle. However, the premium for all multivehicle policies was the same regardless of the number of vehicles insured. The policy in Bazar provided for uninsured-motorist coverage in the amount of $300,000 per vehicle. The plaintiffs had sought a declaration that they were entitled to stack all three vehicles' coverage for a total of $900,000 for a single accident. We agreed with the trial justice that no stacking was allowed because the plaintiffs had paid only the single premium. We stated: "Applying the statutory language in accordance with its clear and unambiguous meaning, this court concludes that stacking of uninsured motorist coverage is not allowable and that the maximum amount of uninsured coverage for any one accident is $300,000." Bazar, 657 A.2d at 1071. This case is not distinguishable from Bazar. The stacking statute is clear and unambiguous. It allows insureds to stack coverage when they have paid two or more separate premiums. In this case the Cardosos paid a single premium for UMBI coverage. The fact that they paid a higher premium because their policy with defendant covered more than one vehicle does not change the essential fact that only one premium was paid. For this reason alone, plaintiff's request for stacking is denied. We answer the certified question in the negative. The coverage may not be stacked in this situation. The papers of the case are remanded to the Superior Court for further proceedings. BOURCIER, J., did not participate.	{ "pile_set_name": "FreeLaw" }
436 F.Supp.2d 316 (2006) Nancy SANTIAGO RIVERA, Plaintiff v. JOHNSON & JOHNSON and Ortho Pharmaceutical, Defendants No. CIV. 05-1351(JP). United States District Court, D. Puerto Rico. June 5, 2006. 317 Celina Romany-Siaca, Celina Romany Law Office, San Juan, PR, Juan M. Frontera-Suau, Frontera-Suau Law Office, San Juan, PR, for Plaintiff. Mariela Rexach-Rexach, Carl E. Schuster, Karem M. Rodríguez-García, Schuster & Aguiló, LLP, San Juan, PR, for Defendants. OPINION AND ORDER PIERAS, Senior District Judge. The Court has before it the defendant's motion for summary judgment (No. 42) and the plaintiff's opposition. The plaintiff 318 worked as a human resources manager for the defendants, and alleges the defendants issued her unfavorable performance evaluations due to her gender and in retaliation in violation of Title VII of the Civil Rights Act of 1964 and Puerto Rico law. The defendant moves for summary judgment on all of the plaintiff's claims. The motion is GRANTED on the grounds that the defendants articulated legitimate non-discriminatory and non-retaliatory reasons for the evaluations, and there is no genuine issue as to whether those reasons were mere pretext for discrimination and retaliation. I. STANDARD Summary judgment serves to assess the proof to determine if there is a genuine need for trial. Garside v. Osco Drug, Inc., 895 F.2d 46, 50 (1st Cir.1990). Pursuant to Rule 56(c) of the Federal Rules of Civil Procedure, summary judgment is appropriate when "the record, including the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits, viewed in the light most favorable to the nonmoving party, reveals no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c); see also Zambrana-Marrero v. Suárez-Cruz, 172 F.3d 122, 125 (1st Cir.1999) (stating that summary judgment is appropriate when, after evaluating the record in the light most favorable to the non-moving party, the evidence "fails to yield a trial worthy issue as to some material fact"); Goldman v. First Nat'l Bank of Boston, 985 F.2d 1113, 1116 (1st Cir.1993); Canal Ins. Co. v. Benner, 980 F.2d 23, 25 (1st Cir.1992). The Supreme Court has stated that "only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Factual disputes that are irrelevant or unnecessary will not be counted." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). In this way, a fact is material if, based on the substantive law at issue, it might affect the outcome of the case. See Mack v. Great Atl. and Pac. Tea Co., Inc., 871 F.2d 179, 181 (1st Cir.1989). In a summary judgment motion, the movant bears the burden of "informing the district court of the basis for its motion and identifying those portions of the [record] which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986). Once the movant meets this burden, the burden shifts to the opposing party who may not rest upon mere allegations or denials of the pleadings, but must affirmatively show, through the filing of supporting affidavits or otherwise, that there is a genuine issue of material fact for trial. See Anderson, 477 U.S. at 248, 106 S.Ct. at 2510; Celotex, 477 U.S. at 324, 106 S.Ct. at 2553; Goldman, 985 F.2d at 1116. II. MATERIAL FACTS NOT IN GENUINE ISSUE OR DISPUTE The Court lists below stipulations of the parties which were entered into at the Initial Scheduling Conference.[1] 1. The plaintiff began to work for the Johnson & Johnson family of companies on or around February 11, 1985. 2. Throughout her employment for the defendants, the plaintiff held various positions related to the Human Resources field. 3. From 1987 to May 23, 2003, the plaintiff was Human Resources Manager 319 for the Manatí operations of Ortho Pharmaceuticals, Inc. 4. At all times relevant to the complaint Ortho Pharmaceuticals was a Delaware Corporation and a subsidiary of Johnson & Johnson Corporation. 5. At all times relevant to the complaint Ortho Pharmaceuticals was authorized to conduct and conducted business in the pharmaceutical industry in Puerto Rico. 6. Johnson & Johnson headquarters are in New Brunswick, New Jersey. 7. Johnson & Johnson and Ortho Pharmaceuticals have more than fifteen employees and engage in interstate and foreign commerce by the sale, manufacture, distribution and administration in the health care business and of health care products. 8. During the plaintiff's tenure at Ortho Pharmaceuticals the organization underwent many significant changes, including mergers, transfer of products from one manufacturing plant to another and the development and implementation of the Lean Manufacturing and Process Excellence programs. 9. From May 26, 2003, up and until the present, the plaintiff occupied the position of Staffing Manager for PGSA Puerto Rico and Latin America, responsible for the Puerto Rico staffing function which serves all PGSA sites in the Island and provides selected services to Mexico and Brazil. 10. Krenly Cruz, as Ortho Manatí's General Manager, supervised the plaintiff's work for approximately nine years, until March, 2002, when he left the Manatí site in order to assume a new role within the defendants' organization. 11. In the plaintiff's 2001 year end evaluation Cruz assessed her performance at a level 5 within a scale of 1 to 9. 12. The plaintiff was not in agreement with the 2001 year end rating obtained from Cruz and so stated in her evaluation form, specifically stating that "My signature [in the document] means that this document was discussed with me although I don't agree with the final rating." 13. Ralph Díaz was appointed General Manager of Ortho Pharmaceutical on April 1, 2002. 14. As General Manager of Ortho Pharmaceutical, Díaz was the plaintiff's direct supervisor. 15. Approximately five months after his designation, on or around September 19, 2002, Díaz met with the plaintiff to discuss her 2002 mid-year performance review. 16. The plaintiff was not in agreement with her 2002 mid-year performance rating, as well as with the deficiencies noted by Díaz during their September 19, 2002, meeting and believed that the rating obtained was the result of gender discrimination at the hands of Díaz. 17. The plaintiff requested the mediation process, which was established by Johnson & Johnson Human Resources Headquarters in New Brunswick, New Jersey, called Common Grounds. 18. On March 4, 2003, Díaz met with Santiago to discuss her 2002 final performance review. At that time, Díaz told Santiago that her performance rating would be at a level 3 within a scale of 1 to 9. 19. The plaintiff was not in agreement with the result of her 2002 year-end evaluation. 20. The Common Ground Program was introduced on a pilot basis at several 320 Johnson & Johnson operating companies. 21. The Common Ground Program pilot program was implemented in Puerto Rico on or around May 1, 2002. 22. On or around May 10, 2002, the plaintiff completed a training course on "How to Achieve Agreements through Common Ground." 23. The parties stipulate all of the language in the Common Ground Program manual. 24. The Mediation part of the Common Ground Program was not automatically available to Puerto Rico employees. Puerto Rico employees had to specifically request that the option be made available to them and receive approval. 25. The plaintiff started Open Door, the first step of the Common Ground Program, in September of 2002 when she met with Díaz. 26. On March 13, 2003, after receiving from Díaz a performance rating of 3 in her year end evaluation, the plaintiff requested in writing to Dolores Calicchio and Laura Rodríguez to engage in the Facilitation part of the Common Ground Program to resolve the dispute. 27. The Facilitation Phase of the Common Ground Program began on March 14, 2003, and Jacqueline Font was chosen as the facilitator. 28. On or around May 20, 2003, Santiago accepted a Staffing Manager position at Pharmaceutical Sourcing Group for the Americas. 29. The plaintiff's last day of work under the supervision of Díaz was on or around May 23, 2003. 30. The plaintiff began work as a Staffing Manager at PSGA on May 26, 2003. 31. The first Common Ground Program facilitation meeting regarding the plaintiffs dispute about her 2002 year end performance evaluation took place on or around November 4, 2003. 32. The second Common Ground Program facilitation meeting regarding the plaintiffs dispute about her 2002 year end evaluation took place on December 11, 2003. 33. The parties were unable to resolve their issues during facilitation and on January 19, 2004, the Plaintiff requested mediation. 34. On January 19, 2004, the plaintiff submitted a completed Mediation Request Form which was later approved. The letter requesting mediation was dated January 9, 2004. 35. On June 25, 2004, the plaintiff filed a charge of discrimination with the EEOC alleging that Ortho had discriminated against her on account of her gender. 36. Johnson & Johnson was not included in the June 25, 2004, charge of discrimination. 37. The plaintiff requested from the EEOC the issuance of a right to sue on November 18, 2004. 38. The EEOC issued a right to sue letter on December 30, 2004, without determining either the merits of the plaintiffs complaint nor whether her complaint was timely. 39. On January 3, 2004, the plaintiff received the right to sue letter from the EEOC. 40. The plaintiff holds a B.A. in Social Work and Psychology from the University of Wisconsin. The Court lists below material facts not in genuine issue or dispute that were properly supported by the defendants and not contested by the plaintiff. 321 1. As Human Resources Manager the plaintiff was responsible for knowledge of discrimination laws, and for managing and implementing equal employment opportunity policies, including anti-discrimination policies. 2. Throughout her employment with the defendants the plaintiff attended several continuing legal education seminars dealing with employment legislation. 3. As a human resources professional the plaintiff knew that in Puerto Rico there is a 300 day limit to file a complaint before the EEOC. 4. Before 2002 concerns were raised regarding the plaintiff's performance. 5. Laura Rodríguez spoke with Santiago regarding her performance, in particular her lack of involvement with the facility and complaints from her Manatí Human Resources Staff regarding over-delegation. 6. On or around 2001 Johnson & Johnson reorganized its pharmaceutical manufacturing companies and created a common reporting management organization. As a result the operations of Ortho Manatí's site became part of what came to be known as the Pharmaceutical Sourcing Group for the Americas (PSGA). 7. The concept of the new organization was that of a contract manufacturer, primarily focused on efficiencies, containment of costs, and developing talent. 8. In the plaintiff's 2001 year end evaluation Cruz assessed her performance at a level 5 in a scale of 1 to 9. 9. The plaintiff was not in agreement with the 2001 year end rating she obtained from Cruz, and so stated on her evaluation form. The source of her disagreement included the coaching function and the technical training strategy. She believed the evaluation did not reflect her performance in these areas. 10. The plaintiff did not welcome the appointment of Díaz as General Manager of Ortho. 11. The plaintiff characterized her relationship with Díaz as "professional," but admits Cruz and Díaz had different management styles. 12. At the time the Manatí plant underwent significant change. 13. The role of the HR Manager for the Manatí site is a critical one. 14. The Common Ground Program applicable to Puerto Rico employees provided a variety of options for resolving employment disputes, such as discussions with supervisors and facilitators. 15. The Common Ground Program pamphlet applicable to the defendants' Puerto Rico employees states that nothing in the program prevents an employee from filing a claim with a federal or state administrative agency, from cooperating with a state or federal agency investigation, or from filing a lawsuit. 16. The Common Ground Program pamphlet states that if an employee files a claim with an administrative agency or a lawsuit, the defendants would advise the agency or court of the Program and request that the agency or court dismiss or stay the case until the process is completed. 17. The Common Ground Program pamphlet also states, "If you are not satisfied after having followed all the available processes available in the Program, you are completely free to take your claim to the courts, if you wish." 18. The Common Grounds Program pamphlet does not say explicitly that 322 the running of the 300 day period to file a charge with the EEOC or the local Anti-discrimination Unit is tolled because of an employee's use of the program. 19. Between June and September of 2002, Díaz requested his staff members to prepare a self assessment of their performance or a draft evaluation, and to send it to him. They would later meet and discuss the self assessment and agree on a realistic rating, although that rating would not be set in stone. 20. At the meeting regarding the plaintiff's 2002 mid year performance review Díaz went over the plaintiffs goals and objectives, clarified areas he believed were key responsibilities of the position, the position's goals, and Díaz and the plaintiff agreed on whether the goals or objectives had been delayed. Díaz also read the plaintiff a paragraph in which he described the plaintiffs need to improve in certain management skills for her success in the role. 21. Díaz communicated to the plaintiff that he was not happy with her results and that she needed to inform him of everything that was happening in the plaint. 22. Díaz also noted that the plaintiffs draft of her performance had not been correctly prepared, because areas of assessment that belonged in the Key Responsibilities area had been included and rated by the plaintiff as part of her Goals and Objectives. He told her that Key Responsibilities were evaluated separately from Project Goals and Objectives and that he expected that someone who had been in Human Resources for as long as the plaintiff would have an understanding of the basic principles of how to develop performance appraisals. 23. Díaz said that the plaintiffs job performance was inadequate in many areas, including performance appraisals, communication with associates, updating personnel related policies, and execution of simple business tasks. He also stated that the plaintiff consulted lawyers excessively on issues of which she should have knowledge, and was unwilling to embrace changes that had occurred within the defendants' organization, and to establish mechanisms to help members adjust to the change. 24. Santiago was so upset upon hearing her mid year performance rating that she did not pay full attention to the comments he made at the meeting. 25. In September or October of 2002 the plaintiff met with Laura Rodríguez to discuss her 2002 mid year performance evaluation and work environment. 26. Rodríguez had received complaints from other employees, men and women, about Díaz's management style. 27. After her meeting with Rodríguez the plaintiff met with Edgardo Fábregas, then Vice President of Operations for PSGA to discuss disagreement with her 2002 mid year performance evaluation. Also present at the meeting were outside consultants for Ortho, Manuel "Coco" Morales from Quality for Business Success, and Ramon Rivera. 28. During the meeting the plaintiff requested that Fábregas help her transfer out of the Manatí plant because she did not want to work with Díaz. Fábregas then responded that he would help effect the transfer. 29. According to Díaz during the year 2002 the plaintiffs performance did 323 not improve. He perceived that she failed to inform him of several situations regarding the plant, failed to attend key meetings, infrequently visited the shop floor, and used poor judgment as to when to leave on vacation. 30. Rodríguez and Fábregas agreed that the plaintiff was having difficulty meeting the job requirements as Human Resources Manager. 31. The plaintiff failed to immediately inform Rodríguez of an employee's resignation letter, causing Rodríguez to travel from Brazil to Puerto Rico on an emergency basis to address the public relations exposure the resignation created for the defendants. 32. Before becoming final evaluations of management employees go through a process called "normalization" during which other members discuss the ratings and challenge them when necessary in order to ensure that they fell within the normal distribution curve. 33. An evaluation of a Human Resources Manager, such as the plaintiff, underwent two normalization processes. 34. An employee's salary at Johnson & Johnson is determined on the basis of percentiles. Every salary band has a minimum and maximum percentile, or benchmark scale (market salary data). Merit increases depend in part on where on the benchmark scale an employee lies. The lower an employee is on the benchmark scale, the higher the merit increase can be. If the employee is already on the upper part of the scale the merit increase is comparatively lower. 35. In her March 13, 2003, letter to Rodríguez and Calicchio, her first written communication to them, the plaintiff stated that she considered her evaluations by Díaz discriminatory, and requested the Facilitation part of the Common Ground Program. 36. After her March 13, 2003, communication the plaintiff met with Calicchio, then Vice President of Human Resources for PSGA, and requested to be transferred, because she did not want to work with Díaz. 37. Fábregas, Rodríguez, and Calicchio looked for other positions that would allow the plaintiff to transfer from the Manatí plant. 38. A reorganization of the defendants' human resources personnel took place, and an opportunity arose for the plaintiff to transfer. The plaintiff accepted the position, a Staffing Manager position at PSGA. 39. After the plaintiff began work as a Staffing Manager, she ceased reporting to Díaz, and her salary and bonuses were not affected. 40. As Staffing Manager the plaintiff was no longer entitled to a company car, but was afforded the opportunity to purchase the company car she had been using. She accepted and purchased the car. 41. By letter dated January 9, 2004, the plaintiff informed the management that she would seek Mediation, the third stage of the Common Ground Program. 42. At some point between December 11, 2003, and January 19, 2004, the plaintiff retained legal counsel. 43. On January 19, 2004, the plaintiff sought approval for Mediation by submitting a completed Mediation Request Form. The request was later approved. On the form the plaintiff informed that she would be represented by counsel during the process. 324 44. The plaintiff requested that the mediation take place in Puerto Rico. 45. Mediation was delayed due to scheduling conflicts. 46. The Mediation never took place, because the plaintiff withdrew her request and filed a complaint with the EEOC. 47. On June 25, 2004, the plaintiff filed a charge of discrimination with the EEOC, alleging that Ortho discriminated against her due to her gender. 48. Johnson & Johnson, the parent company, was not notified of the June 25, 2004, charge, because the address provided was that of Ortho. 49. The charge was notified to the new Human Resources Director for the Ortho Manatí plant, Fernando Bermudez. 50. The EEOC issued a right to sue letter on December 30, 2004. 51. The plaintiff received the right to sue letter on January 3, 2005. 52. On March 30, 2005, the plaintiff filed the instant civil action. III. ANALYSIS A. TITLE VII The plaintiff claims that Díaz rated her performance at a three on a scale of one to nine for both her 2002 mid year and year end evaluations due to her gender. She also claims that the 2002 year end evaluation and her subsequent transfer to another position within the defendants' organization was in retaliation for her complaints to defendants' personnel about Díaz. The defendants argue that they are entitled to summary judgment on the grounds that the plaintiff failed to exhaust administrative remedies, and that the plaintiff cannot establish a prima facie case of discrimination and retaliation, and that there is no genuine issue as to whether the evaluations were motivated by gender discrimination or retaliation. Even assuming the plaintiff exhausted her administrative remedies, and established a prima facie case of discrimination and retaliation, the defendants are entitled to summary judgment on the Title VII claims, because there is no genuine issue as to whether their articulated reasons for the evaluations were pretextual. Title VII discrimination and retaliation cases proceed under the three-step burden shifting framework outlined in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973). See Calero-Cerezo v. U.S. Dep't of Justice, 355 F.3d 6, 26 (1st Cir.2004). First the plaintiff must establish a prima facie case for discrimination or retaliation. Then the burden shifts to the defendant to present a legitimate non-discriminatory, or, if retaliation is claimed, non-retaliatory reason for the adverse employment decision. Finally the plaintiff must demonstrate that the defendant's articulated reason is mere pretext for discriminatory or retaliatory animus. McDonnell Douglas, 411 U.S. at 802, 93 S.Ct. 1817; Quinones v. Buick, 436 F.3d 284, 289 (1st Cir.2006). The defendants articulated legitimate non-discriminatory and non-retaliatory reasons for their employment decisions. The defendants argue the plaintiffs evaluations were warranted by her deficient performance. The undisputed facts show that Rodríguez and Fábregas agreed the plaintiff did not meet her job requirements as Human Resources Manager. After the mid year performance evaluation, Díaz observed that the plaintiffs performance did not improve, and consequently did not increase her rating for the year end evaluation. The defendants argue the plaintiff was transferred to the Staffing Manager position, because, as the uncontested facts 325 show, she no longer wished to work with Díaz, she requested to be moved to the Manatí plant, and accepted the new position. The plaintiff failed to present any evidence the defendants' articulated reasons were mere pretext for discrimination or retaliation for her complaints to her supervisors. Even in cases where motive or intent are at issue, "summary judgment may be appropriate if the non-moving party rests merely upon conclusory allegations, improbable inference, and unsupported speculation." Medina-Muñoz v. R.J. Reynolds Tobacco Co., 896 F.2d 5, 8 (1st Cir.1990). The plaintiff attempts to raise a genuine issue as to the defendants' motives for the evaluations with evidence that the rest of Díaz's direct reports at the Manatí plant were male, and received a five or more for their mid year review, and that Luis Zayas, Díaz's close friend and best man at his wedding received an eight after working at the plant for only three months. However the plaintiff failed to give any information that indicates these reviews did not reflect the employees' performance. The mere fact that these employees were male and received higher performance ratings does not indicate that the plaintiff's lower rating was due to her gender. The plaintiff also provided evidence that other employees complained to her about a "men's club" composed of Díaz, Luis Zayas, Larry Rosario, and Humberto Martin, and that they believed that if an employee was not a part of the club then that employee was at a disadvantage. However the plaintiff failed to provide any evidence that supports her or the complaining employees' speculation as to the presence of disparate treatment. A female employee complained to the plaintiff that Martin made "dirty jokes." However the plaintiff herself testified in her deposition that no employees complained to her about Díaz, the author of her disputed evaluations. The plaintiff gives abundant evidence that Díaz had a demanding management style, and was eventually transferred to a position with fewer direct reports. It is also clear that Díaz requested the plaintiff be terminated from her position, and that upper management instead opted to provide the plaintiff with more training. These facts do not support an inference that Díaz based his evaluations on discrimination or retaliation. With respect to the plaintiff's retaliation claim regarding her transfer, it is clear that the plaintiff complained about her evaluations within the company, but the plaintiff failed to provide any evidence that her transfer was due to her complaints, or was the result of anything other than her own request to be transferred. Because there is no evidence of pretext for gender discrimination or retaliation, the defendants are entitled to summary judgment on the Title VII claims. B. LAW 100 The plaintiff also claims the defendants' actions violated Puerto Rico's Law 100. Law 100 of June 30, 1959, P.R. Laws Ann. tit. 29 § 146 et seq., is Puerto Rico's general employment discrimination statute. See Cardona Jimenez v. Bancomerico de Puerto Rico, 174 F.3d 36, 42 (1st Cir.1999); see also ÁlvarezFonseca v. Pepsi Cola of Puerto Rico Bottling Co., 152 F.3d 17, 27 (1st Cir.1998). Under Law 100, the employee has the initial evidentiary burden to establish three factors: (1) that he or she suffered an adverse employment action, (2) that the adverse employment action was unjustified (not for good cause), and (3) some basic fact substantiating the type of discrimination alleged. Morales v. Nationwide Ins. Co., 237 F.Supp.2d 147, 153 (D.P.R.2002). If the employee establishes these three factors, 326 the burden shifts to the employer to prove by a preponderance of the evidence that the adverse employment action "was not motivated by discriminatory animus." Id., at 153. It is not necessary for the employer to "articulate a reasonable explanation for the [adverse employment action]." Ibañez v. Molinos de P.R., 14 P.R. Offic. Trans. 61, 76, 1983 WL 204221 (1983). If the employer rebuts the presumption, then the employee has the burden of proving the existence of discrimination. Morales, 237 F.Supp.2d at 153. To determine what constitutes good cause under a Law 100 claim, a court looks to the definition of good cause in Law 80. Báez García v. Cooper Labs, Inc., 120 P.R. Offic. Trans. 153, 161, 1987 WL 448243 (1987). The defendants are entitled to summary judgment on the plaintiff's Law 100 claims, because even assuming the defendants' employment decisions were not made for good cause, as discussed in the context of the plaintiffs Title VII claims, there is no genuine issue as to whether the defendants' actions were motivated by discriminatory animus. C. ACT 69 The plaintiff also claims the defendants retaliated against her in violation of Puerto Rico's Act 69. Act 69 of July 6, 1985, as amended, P.R. Laws Arm. tit. 29 § 1321-1341, is Puerto Rico's gender employment discrimination statute. Under Act 69 it is unlawful for an employer "to dismiss or discriminate against any employee or participant who files a complaint or charge, or is opposed to discriminatory practices, or participates in an investigation or suit for discriminatory practices against the employer." P.R. Laws Ann. tit. 29 § 1340. The defendants are entitled to summary judgment on the plaintiff's Act 69 claim, because as discussed in the context of the plaintiff's Title VII claims, there is no genuine issue as to whether the defendants transferred the plaintiff in retaliation for her complaints about Díaz. V. CONCLUSION The Court GRANTS the defendants' motion for summary judgment, and will enter judgment dismissing the complaint with prejudice. IT IS SO ORDERED. NOTES [1] Stipulations numbered 17 and 35 were amended at docket number 26.	{ "pile_set_name": "FreeLaw" }
639 F.2d 828 1980-81 Trade Cases 63,778 B. C. RECREATIONAL INDUSTRIES, Harry Fireman, Paul Fireman,Steven Fireman and Richard W. Wennett, Executor ofthe Estate of Samuel Fireman,Plaintiffs-Appellants,v.The FIRST NATIONAL BANK OF BOSTON, John Horvitt, ClarkMiller, Benjamin Bowden, Victor Mourey and RobertWeisberg, Defendants-Appellees. No. 80-1383. United States Court of Appeals,First Circuit. Argued Nov. 4, 1980.Decided Jan. 30, 1981. Morris Michelson, Boston, for plaintiffs-appellants. Francis H. Fox, Boston, with whom Rory Fitzpatrick, and Bingham, Dana & Gould, Boston, were on brief, for defendants-appellees. Before COFFIN, Chief Judge, BOWNES, Circuit Judge, HOFFMAN,* District Judge. BOWNES, Circuit Judge. 1 This is an appeal from an order of the district court granting defendants' motion for summary judgment on two counts of a nine-count complaint and dismissing the seven remaining counts. The complaint was brought by B.C. Recreational Industries (BC) and its principal shareholders, officers, and directors, Harry, Paul, Steven, and Samuel Fireman, against the First National Bank of Boston (Bank), the FNB Financial CompanyB, John Horvitt,** a former financial advisor of BC, and four other individuals alleged to be officers of the Bank. 2 A summary of the undisputed facts is necessary to understand the complaint and the issues before us. In September of 1964, BC entered into a factoring agreement with the Bank. In 1969 the Bank assigned all of its interest in BC's loan and collateral to First National Factors of Boston, a newly organized affiliate of the Bank. The same individuals who had handled BC's factors loan at the Bank continued in the same role for First National Factors. On September 1, 1970, BC executed a new factoring agreement with First National Factors and, pursuant thereto, gave it a security interest in all of the property held by the Bank as collateral. The collateral at this time was the usual type for a factors loan, an assignment of all accounts receivable. 3 In 1972 First National Factors changed its name to FNB Financial Company. There was no change in the factoring arrangement, and BC continued to deal with the same individuals. FNB was organized as a Massachusetts business trust. All of its shares were owned or controlled by First National Boston Corporation, a bank holding company that also owned all of the stock of the Bank. The three corporate entities the Bank, FNB, and First National Boston Corporation were located in the same building, shared common offices, had common directors, and, at times, used one another's stationery. 4 In August 1972 FNB required BC to employ John Horvitt as a full-time business advisor, because it felt that BC was in a precarious financial condition. Horvitt continued as a business advisor to BC until early in May 1974. BC filed a Chapter XI bankruptcy proceeding on July 2, 1974. 5 From a stipulation dated December 23, 1974, and filed in BC's bankruptcy proceeding, it also appears that in August of 1972 the Fireman Realty Trust, a trust comprised of the owners and directors of BC, granted to FNB, as agent for the Bank, mortgages on certain properties owned by the trust in Miami, Florida, and in Braintree and Stoughton, Massachusetts. The trust also granted to the Bank a security interest in a beneficial interest of the trust in real estate in Chicago, Illinois. The stipulation also recites that Steven, Paul, Harry, and Samuel Fireman pledged private stockholdings to the Bank as further security for the loan. 6 The main thrust of the complaint is that the Bank, using FNB as a subsidiary, forced BC to hire Horvitt and that its purpose in doing so was not to strengthen the business position of BC, but to manage it so that the Bank's factors lien would be fully protected at all times. It is alleged that Horvitt insisted on increasing BC's line of credit with manufacturers and suppliers, thus increasing the debt owed the Bank at high interest rates. The management policy of Horvitt, allegedly carried out in concert with and at the request of the Bank, resulted, plaintiffs claim, in injury to BC, its shareholders and directors. 7 Paragraph two of the complaint grounds jurisdiction on 28 U.S.C. § 13481 (banking association as party) and 28 U.S.C. § 13372 (antitrust violations). Its causes of action are predicated on 12 U.S.C. § 1975,3 which grants a federal civil remedy to any person injured by the tying arrangement prohibited in 12 U.S.C. § 1972, and 15 U.S.C. § 15,4 which grants a federal cause of action to a person injured in business or property by violations of the antitrust laws. 8 Count I alleges that the defendants violated the tying prohibitions of 12 U.S.C. § 19725 by forcing plaintiffs to hire Horvitt as a financial advisor. The district court granted summary judgment on the following grounds: that FNB was not the agent or subsidiary of the Bank; that, since the factoring agreement was with FNB, there could be no violation of 12 U.S.C. § 1972 because FNB was not a bank; that there was no showing of any anticompetitive tying arrangement. 9 Count II alleges that the forced hiring of Horvitt was an "illegal tie-in in restraint of a free market and free trade" in violation of 15 U.S.C. §§ 1-7. This count was dismissed under Federal Rule of Civil Procedure 12(b)(6) for failure to state a cause of action. 10 Count IV alleges that the Bank violated 12 U.S.C. § 92a(a)6 by acting in a fiduciary capacity without obtaining a permit from the Comptroller of the Currency. The district court granted summary judgment on the ground that FNB, the lending entity, was not a bank and, therefore, not subject to the statute. 11 Count VIII, which was added in the amended complaint, does not set forth a specific cause of action. It is a summary of Counts I and II and alleges a violation of "Title 12 and Title 15 of U.S.C." 12 Counts III, V, VI, VII and IX are based on alleged violations of Massachusetts law. They were dismissed by the district court for lack of pendent jurisdiction on the authority of United Mine Workers v. Gibbs, 383 U.S. 715, 726, 86 S.Ct. 1130, 1139, 16 L.Ed.2d 218 (1966). 13 Our approach to Count I is different from that of the district court. We start our analysis by assuming that FNB was the agent of the Bank.7 The core issue, as we see it, is whether plaintiffs have stated a cause of action for a violation of 12 U.S.C. § 1972 by the Bank. 14 The legislative history of this statute reveals that it was aimed at preventing the use of the economic power of a bank to lessen competition or engage in unfair competitive practices. S.Rep. No. 1084, 91st Cong., 2d Sess., reprinted in (1970) U.S.Code Cong. & Ad.News, pp. 5519, 5535. It is specifically stated: "The committee does not intend, however, that the provision interfere with the conduct of appropriate traditional banking practices." Id. The purpose of the tying provision "is to prohibit anti-competitive practices which require bank customers to accept or provide some other service or product or refrain from dealing with other parties in order to obtain the bank product or service they desire." Id. 15 The two cases that have considered alleged violations of 12 U.S.C. § 1972 are in agreement that the tying arrangements prohibited are those that require bank customers to accept or provide other services or products or refrain from dealing with other parties. Duryea v. Third Northwestern Nat'l Bank, 606 F.2d 822, 825 (8th Cir. 1979); Swerdloff v. Miami Nat'l Bank, 584 F.2d 54, 58 (5th Cir. 1978). See also Costner v. Blount Nat'l Bank, 578 F.2d 1192 (6th Cir. 1978). 16 So also, it has been held that the tying prohibitions do not interfere with the conduct of appropriate traditional banking practices. McCoy v. Franklin Savings Ass'n & Mortgage Management Co., 636 F.2d 172 (9th Cir. 1980); Clark v. United Bank of Denver Nat'l Ass'n, 480 F.2d 235, 238 (10th Cir. 1973). In Sterling Coal Co. v. United Am. Bank, 470 F.Supp. 964, 965 (E.D.Tenn.1979), the court held: "The Act does not prohibit attempts by banks to protect their investments." The court ruled specifically that conditioning the grant and extension of credit on the requirement that the bank supervise and control the plaintiff's checking account and other corporate affairs, including veto power over purchases and payments of dividends, was not prohibited by the Act. Id. 17 Plaintiffs argue that the forced hiring of Horvitt was in violation of 12 U.S.C. § 1972(1)(C), which forbids the extension of credit on the requirement "that the customer provide some additional credit, property, or service to such bank, other than those related to and usually provided in connection with a loan, discount, deposit, or trust service(.)"8 We are hard put to find any tie-in, let alone one which is prohibited. There is nothing in the pleadings, affidavits, and depositions filed indicating that Horvitt had any financial connection with either the Bank or FNB. Although we can understand how Horvitt might have provided additional security, in the form of management control, to the Bank, this does not come within the ambit of "additional credit, property or service" no matter how broadly those terms are construed. We add that in addition to there being no tie-in alleged or proved, in any event, the arrangement complained of falls within the range of appropriate traditional banking practices permissible under the Act. 18 Plaintiffs' pleadings have a Faustian ring; in return for credit, they delivered themselves into the hands of the Bank, and it insisted that its investment be protected by installing the devil Horvitt to run their company when it got into financial difficulty. Horvitt may have done everything plaintiffs allege, and the Bank may have instructed him to do so, but this was done in order to protect the Bank's investment. It is possible that some of the specific practices directed by Horvitt may have been tortious as to BC,9 but since his retention constituted legitimate bank practice, such actions do not implicate any prohibited tying arrangements. We rule that plaintiffs have failed to state a cause of action for violation of 12 U.S.C. § 1972. 19 Our ruling that the pleadings do not admit of a claim that the actions of the Bank or FNB were intended to or resulted in the lessening of competition or encouraging unfair competitive practices also disposes of Count II. This count was properly dismissed by the district court for failure to state a cause of action. For a tying arrangement to violate the Sherman Act, it must, to some extent, have the effect of restraining free competition in the market for the tied product. Northern Pac. Ry. v. United States, 356 U.S. 1, 5, 78 S.Ct. 514, 518, 2 L.Ed.2d 545 (1958). Here, there were no facts alleged which indicated any restraint of competition in the market for services such as Horvitt provided, even if such a market exists. 20 Nor can we see how Horvitt's hiring had any effect on competition in the recreational goods market, except, of course, that the demise of BC, which plaintiffs attribute to Horvitt's management, decreased the number of companies in that field by one. There is nothing in the material filed by plaintiffs alleging or suggesting that the Bank forced BC to hire Horvitt so that the business posture of a competitor or competitors of BC would be strengthened at BC's expense. And there is nothing suggesting that the Bank or FNB had any interest, direct or indirect, in such a competitor. The observations we made in A.D.M. Corp. v. Sigma Instruments, Inc., 628 F.2d 753, 754 (1st Cir. 1980), are pertinent: 21 While it is not inconceivable that "mere" unfair business practices, or business torts, could in the proper situation constitute an antitrust violation, see George R. Whitten, Jr., Inc. v. Paddock Pool Builders, Inc., 508 F.2d 547, 560 (1st Cir. 1974), cert. denied, 421 U.S. 1004, 95 S.Ct. 2407, 44 L.Ed.2d 673 (1975), the transmutation of these state law torts into federal antitrust violations would have to be based upon a finding that the injuries for which compensation is sought have an unreasonable effect on competition, as well as on a particular competitor. See III P. Areeda & D. Turner, Antitrust Law P 737 (1978). 22 The gravamen of Count IV is contained in paragraph 50 of the complaint: 23 The defendant Bank violated Title 12, U.S.C., Section 92A; that it did not receive a permit from the Comptroller to take on a fiduciary capacity with a separate corporation; that the Bank not only unlawfully assumed a fiduciary duty, but it breached that duty as well. 24 We must assume that plaintiffs were referring to section 92a(a), see footnote 6, supra, because it is only this section that authorizes the Comptroller of the Currency to permit national banks to act in a fiduciary capacity. As the district court pointed out, the purpose of this statute is to allow national banks to compete on an equal footing with state banks as fiduciaries. Our analysis again assumes that the Bank acted through FNB. It is difficult to discern a fiduciary relationship between the Bank and any of the plaintiffs. In paragraph 49 of the complaint it is asserted that the defendants "had a fiduciary duty to promote the interest of the plaintiff BCRI and that this duty was breached by actions which promoted the interests and accumlated (sic ) debt to the Bank at the detriment and disadvantage of the plaintiffs." The scope of "fiduciary" is specified in the statute; national banks may be granted 25 the right to act as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, committee of estates of lunatics, or in any other fiduciary capacity in which State banks, trust companies, or other corporations which come into competition with national banks are permitted to act under the laws of the State in which the national bank is located. 26 12 U.S.C. § 92a(a). It would indeed be stretching the definition of fiduciary to hold that a bank, by lending money on a factors lien agreement, owes a fiduciary duty to the borrower. The pleadings and other material filed do not allege any facts indicating that there was a fiduciary relationship between the Bank or FNB and BC, and therefore defendants were entitled to summary judgment as a matter of law. Fed.R.Civ.P. 56(c).10 27 We affirm the district court's dismissal of Count VIII. This count was only a conclusory summary of Counts I and II and stated no separate cause of action. 28 Finally, we turn to the pendent state claims. "It has consistently been recognized that pendent jurisdiction is a doctrine of discretion not of plaintiff's right." United Mine Workers v. Gibbs, 383 U.S. at 726, 86 S.Ct. at 1139; see Landrigan v. City of Warwick, 628 F.2d 736, 748 (1st Cir. 1980). Plaintiffs made a deliberate, if not very well reasoned, choice to proceed in federal court. They have been unable to cross the federal threshold. The district court did not abuse its discretion in dismissing the pendent jurisdiction claims. 29 Affirmed. * Of the Eastern District of Virginia, sitting by designation ** Appellants spell Horvitt with two "t's"; appellees use one. We apologize to the gentleman if our spelling is incorrect 1 § 1348. Banking association as party The district court shall have original jurisdiction of any civil action commenced by the United States, or by direction of any officer thereof, against any national banking association, any civil action to wind up the affairs of any such association, and any action by a banking association established in the district for which the court is held, under chapter 2 of Title 12, to enjoin the Comptroller of the Currency, or any receiver acting under his direction, as provided by such chapter. All national banking associations shall, for the purposes of all other actions by or against them, be deemed citizens of the States in which they are respectively located. 2 § 1337. Commerce and antitrust regulations; amount in controversy, costs (a) The district courts shall have original jurisdiction of any civil action or proceeding arising under any Act of Congress regulating commerce or protecting trade and commerce against restraints and monopolies: Provided, however, That the district courts shall have original jurisdiction of an action brought under section 20(11) of part I of the Interstate Commerce Act (49 U.S.C. 20(11) or section 219 of part II of such Act (49 U.S.C. 319), only if the matter in controversy for each receipt or bill of lading exceeds $10,000, exclusive of interest and costs. (b) Except when express provision therefor is otherwise made in a statute of the United States, where a plaintiff who files the case under section 20(11) of part I of the Interstate Commerce Act (49 U.S.C. 20(11) or section 219 of part II of such Act (49 U.S.C. 319), originally in the Federal courts is finally adjudged to be entitled to recover less than the sum or value of $10,000, computed without regard to any setoff or counterclaim to which the defendant may be adjudged to be entitled, and exclusive of any interest and costs, the district court may deny costs to the plaintiff and, in addition, may impose costs on the plaintiff. (As amended Oct. 20, 1978, Pub.L. 95-486, § 9(a), 92 Stat. 1633.) 3 § 1975. Civil actions by persons injured; jurisdiction and venue; amount of recovery Any person who is injured in his business or property by reason of anything forbidden in section 1972 of this title may sue therefor in any district court of the United States in which the defendant resides or is found or has an agent, without regard to the amount in controversy, and shall be entitled to recover three times the amount of the damages sustained by him, and the cost of suit, including a reasonable attorney's fee. Pub.L. 91-607, Title I, § 106(e), Dec. 31, 1970, 84 Stat. 1767. 4 § 15. Suits by persons injured; amount of recovery 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 in the district in which the defendant resides or is found or has an agent, without respect to the amount in controversy, and shall recover threefold the damages by him sustained, and the cost of the suit, including a reasonable attorney's fee. 5 12 U.S.C. § 1972 provides in pertinent part: (1) A bank shall not in any manner extend credit, lease or sell property of any kind, or furnish any service, or fix or vary the consideration for any of the foregoing, on the condition or requirement (A) that the customer shall obtain some additional credit, property, or service from such bank other than a loan, discount, deposit, or trust service; (B) that the customer shall obtain some additional credit, property, or service from a bank holding company of such bank, or from any other subsidiary of such bank holding company; (C) that the customer provide some additional credit, property, or service to such bank, other than those related to and usually provided in connection with a loan, discount, deposit, or trust service; (D) that the customer provide some additional credit, property, or service to a bank holding company of such bank, or to any other subsidiary of such bank holding company; or (E) that the customer shall not obtain some other credit, property, or service from a competitor of such bank, a bank holding company of such bank, or any subsidiary of such bank holding company, other than a condition or requirement that such bank shall reasonably impose in a credit transaction to assure the soundness of the credit. 6 § 92a. Trust powers Authority of Comptroller of the Currency (a) The Comptroller of the Currency shall be authorized and empowered to grant by special permit to national banks applying therefor, when not in contravention of State or local law, the right to act as trustee, executor, administrator, registrar of stocks and bonds, guardian of estates, assignee, receiver, committee of estates of lunatics, or in any other fiduciary capacity in which State banks, trust companies, or other corporations which come into competition with national banks are permitted to act under the laws of the State in which the national bank is located. 7 We intimate no ruling on whether or not summary judgment should have been granted for defendants on plaintiffs' claim that FNB was an agent of the Bank 8 For some reason, plaintiffs in their brief at 31 have substituted numbers for the alphabetical listings used in the statute 9 We express no opinion on whether plaintiffs have stated a cause of action under Massachusetts law 10 The question of whether or not plaintiffs have standing to sue as to this claim is not without difficulty. Although it is doubtful that plaintiffs could meet the test of Cort v. Ash, 422 U.S. 66, 95 S.Ct. 2080, 45 L.Ed.2d 26 (1975), the predecessor statute of 12 U.S.C. § 93, which prescribed the actions that the Comptroller could take for violations of the National Bank Act, was construed by the Supreme court to give a private cause of action to a stockholder who suffered injury by relying on false bank reports. Chesbrough v. Woodward, 244 U.S. 72, 76-77, 37 S.Ct. 579, 581-82, 61 L.Ed. 1000 (1916). In Harmsen v. Smith, 542 F.2d 496 (9th Cir. 1976), the Ninth Circuit relied on Chesbrough to rule that 12 U.S.C. § 93, which sets forth the procedures, penalties and remedies available to the Comptroller of the Currency for violations of the National Bank Act, including § 92a(a), can also be the basis for a private right of action. See also Seiden v. Butcher, 443 F.Supp. 384 (S.D.N.Y.1978)	{ "pile_set_name": "FreeLaw" }
45 F.3d 51 UNITED STATES of America, Appellee,v.Pedro Fernando CHUNZA-PLAZAS, Defendant-Appellant. No. 366, Docket 94-1009. United States Court of Appeals,Second Circuit. Argued Nov. 10, 1994.Decided Jan. 23, 1995. Mark B. Gombiner, The Legal Aid Soc., Federal Defender Div. Appeals Bureau, New York City, for defendant-appellant. Jodi Levine Avergun, Asst. U.S. Atty. for the E.D. of N.Y. (Zachary W. Carter, U.S. Atty. for the E.D. of N.Y., Susan Corkery, Asst. U.S. Atty., of counsel), for appellee. Before: FEINBERG, KEARSE, and PRATT, Circuit Judges. PRATT, Circuit Judge: BACKGROUND 1 On March 26, 1993, agents of the Drug Enforcement Agency ("DEA") and the Immigration and Naturalization Services ("INS"), acting on a tip from the Colombian National Police, went to the Staten Island home of Pedro Fernando Chunza-Plazas, a retired Colombian police officer. Chunza identified himself as Fernando Chunza and allowed the agents to enter his home. 2 Chunza consented to a search of his home, and the agents found two fraudulent alien-registration cards in the names of Pedro Fernando Chunza and Jose Gonzalez, and two counterfeit social-security cards in the names of Jose Gonzalez and Pedro F. Chunza. Under questioning, Chunza acknowledged his possession of the documents and admitted that on October 5, 1990, he had illegally entered the United States by using a false passport. 3 A grand jury returned a six-count indictment charging Chunza with two counts of possessing fraudulent alien-registration cards, two counts of possessing unlawfully produced social-security cards, and two counts of possessing false social-security cards with the intent to defraud the United States. On June 25, 1993, Chunza pled guilty to the two counts of possessing fraudulent alien-registration cards. 4 The probation department determined Chunza's base offense level to be 6, and reduced that from 6 to 4 for accepting responsibility. U.S.S.G. Sec. 3E1.1. With a criminal history category of I, Chunza's guideline range was 0-6 months. 5 By letter dated September 30, 1993, the government moved under U.S.S.G. Sec. 5K2.0 and Sec. 5K2.9 for an upward departure to five years, claiming that Chunza's "motivation in obtaining and using the false green cards constitutes an 'aggravating * * * circumstance of a kind or a degree, not adequately taken into consideration by the Sentencing Commission.' " The government's motion sought a Fatico hearing, so that it could prove that Chunza, "while a member of the Colombian National Police, acted as a paid assassin and security guard for the Medellin Colombian cocaine cartel [then] run by Pablo Escobar Gaviria." The letter also stated that Chunza's criminal activities on behalf of Escobar led to Chunza's discharge from the Colombian police and to the issuance of arrest warrants for homicides, drug trafficking, and assault. The government concluded that Chunza "left Colombia to avoid prosecution for the acts he committed on behalf of Escobar" and that Chunza used the green cards "to conceal his past crimes in Colombia", which, it claimed, were "relevant to his sentencing". 6 At the Fatico hearing, the government called three witnesses: (1) an anonymous former Colombian judge, (2) Carlos Arredondo, and (3) DEA Special Agent Sam Trotman. 7 The anonymous judge, a current member of the Prosecutor General's Office in Colombia, testified about the issuance of four warrants for Chunza's arrest in Colombia. Three of the four were military warrants; the fourth was a civilian warrant. 8 Two of the three military warrants were for homicide; the third charged Chunza with "personal injuries to an individual." The military warrants were all dated March 26, 1993, the day Chunza was arrested in the United States. The two homicide warrants failed to state the names of the victims, the dates, or the places of the alleged crimes. The other military warrant stated that the crime had occurred on May 12, 1990, but it did not identify the type of offense, the victim, or the place where the alleged act occurred. When the former judge was cross-examined about the lack of information in the warrants, he explained that it was not the custom in Colombia to include this information and it was not required by law. The witness also did not know the basis for issuing one of the warrants. He also could not explain why the warrants had not been issued until March 26, 1993, even though Chunza had left Colombia in October of 1990. 9 The anonymous judge testified that the civilian warrant was based on the statements of Jhon Jairo Posada Valencia and a "witness with [an] undisclosed identity" who had personal knowledge about Chunza's activities for Escobar. Neither of these written statements had been made to the anonymous judge; they were made to another Regional Prosecutor. 10 When questioned about Posada's statement, the anonymous judge testified that it had not been given under oath but was part of a penal or criminal proceeding. The anonymous judge also acknowledged that when Posada was questioned in his statement about Chunza, he had denied any personal knowledge of Chunza's activities and did not know who Chunza was. 11 The other statement underlying the civilian warrant, the one by the "witness with [an] undisclosed identity," indicated (1) that Chunza had participated in homicides and kidnappings in Colombia on behalf of the Medellin cartel as recently as February 1993, less than two months before Chunza was arrested at his Staten Island home, and (2) that the last time he had seen Chunza, "[Chunza] was with five guys with rifles R-15, that was one month and twenty days ago, that is, at the beginning of February of this year [1993]", in Medellin. The unidentified witness also provided the only evidence that even hinted at any possible drug activity by Chunza in the United States after he came here in 1990. The unidentified witness said: 12 I knew that a report was issued by Universal (illegible) stating that DARWING, CARRO VIEJO's brother said that the doctor, that is PABLO ESCOBAR, planned to send somebody he trusted very much to the United States to collect some money and (illegible) and the person named to do that was CHU[N]ZA, because he was the only one left, the most trusted at that time, I (illegible) this comment more or less the last time I saw him, that is, at the beginning of February [1993] 13 (emphasis supplied). There was no corroboration to this third-level hearsay, and neither the unidentified witness nor anyone else provided evidence that Chunza had actually come here to collect money. 14 Although the unidentified witness did not explain how he knew about Chunza's alleged criminal activities, he did state, "[S]ometimes we were eighty people, we met to smoke marijuana, to be vicious, even Pablo [Escobar] was there, including people from the Jail of Itagui, I know this because I earned the trust of Carro Viejo and I went there as his friend." And again, "I met (illegible), his last name was Durango and Pablo Escobar ordered his death and he is buried near doctor Carlos Mauro Hoyos, as their friend they talk to me about things and I realized some of [the] things they were doing which is what I am telling now." 15 The second witness at the Fatico hearing, Carlos Arredondo, a confessed member of the Medellin cartel, testified about Chunza's activities in Colombia. In July of 1992 Arredondo came to the United States to collect drug money, but he was soon arrested for transporting twenty kilos of cocaine in his car and was sentenced to ten years to life in prison. After Arredondo pled guilty, he cooperated with the government and agreed to testify at the Fatico hearing in hopes of receiving a 5K1.1 letter. 16 At the hearing, Arredondo claimed that he had first heard of Chunza in September of 1988, when Fernando Galeano, an important member of the Medellin drug cartel, had employed Arredondo to help in the search for Galeano's father who was kidnapped by guerrillas. Escobar recommended to Galeano that Chunza could help locate Galeano's father. During the sixty-to-seventy-day search for Galeano's father, Chunza frequently met with Galeano. After Galeano's father was found, Galeano employed Arredondo as one of his bodyguards. 17 Still working for Galeano in 1989, Arredondo participated in a cocaine transaction at which, he said, Chunza was present. Arredondo and Galeano flew to Dorado to meet with Escobar. At the runway, Chunza was seated in one of the two cars. Arredondo contended that Galeano spoke with Chunza and that Chunza directed Arredondo while loading 300 kilograms of cocaine from the car on to Galeano's plane. 18 Arredondo also described Chunza's alleged role in the death of two Colombian police officers who attempted to assassinate councilman Alvares Henao ("Henao"). According to Arredondo, when Galeano learned that certain policemen were planning to kill Henao, Galeano hired Chunza to investigate and kill the police officers who were threatening Henao's life. Arredondo claimed to have learned this information from other people. 19 The government's third witness at the Fatico hearing was D.E.A. Agent Sam Trotman ("Trotman"), the case agent in charge of the prosecution of Escobar and Danny Munoz Mosquera for "cocaine trafficking, international terrorism, * * * murder, Rico". Trotman testified that he had interviewed an unnamed paid informant who was a former member of the Medellin cartel. Trotman was unaware of where the informant was at the time of the hearing. However, after speaking with controlling agents in Bogota, who had independently corroborated information from this informant in the past, Trotman believed this informant to be a reliable source. 20 The paid informant had said that a hit man named "Popi" told him that Escobar had ordered Chunza to obtain the passenger manifest for Avianca Airlines flight 203, which was later blown up. "Popi" was never identified, and there was no testimony as to how the hit man knew what Escobar had told Chunza to do, or whether Chunza ever did it. The informant also had reported that Chunza had given information to Escobar about the movements of Colombian troops, but Trotman acknowledged that the informant did not have any factual basis for this allegation. 21 Trotman also testified that he had interviewed another informant who worked for Kiki Moncada, a major drug dealer. This informant had stated that Chunza was a confidant of Gustavo Gaviria, Escobar's cousin, and that Chunza had been at Escobar's ranch several times. But the informant had neither met nor spoken to Chunza. During cross-examination, Trotman admitted that he had no knowledge that Chunza had participated in any criminal activities in the United States. Trotman also acknowledged that Chunza was not named in the indictment concerning the Avianca bombing. 22 After the Fatico hearing, the government renewed its motion for an upward departure from 0-6 months to a five-year sentence. The government contended that based on the evidence at the Fatico hearing, "it has been established by a preponderance of the evidence that Chunza was a member of the Medellin [c]artel, committed criminal acts at the behest of Pablo Escobar, and came to the United States both to assist Escobar in collecting money owed to the [c]artel and to avoid further prosecution in Colombia related to his activities in the [c]artel." The government argued under Sec. 5K2.9, that these were the motivating factors in Chunza's illegal possession of the false immigration documents, and that possession of the false green cards had allowed him to conceal his involvement in the Medellin cartel. 23 The government also contended that an upward departure should be made under U.S.S.G. Sec. 4A1.3 because it had proved the "defendant's participation in at least one murder, one incident of cocaine trafficking and one instance of terrorism." As a result, the prosecutor argued, Chunza's sentence should be based on a criminal history category of IV instead of I, because Chunza "is in a position akin to defendants who have three prior convictions resulting in three separate sentences of more than a year" and an offense level of 20, which would yield a guideline range of 51 to 63 months. 24 At sentencing, Gino Singer, Chunza's counsel, objected to any upward departure. In answer to the government's argument that a departure was justified under U.S.S.G. Sec. 4A.1.3, he stressed that Chunza had no prior criminal convictions. Singer also argued that any pending criminal proceedings against Chunza for crimes allegedly committed in Colombia should be punished in Colombia, not in this proceeding. He pointed out that under Sec. 4A.1.3, an upward departure cannot be grounded upon uncharged and unsentenced allegations of foreign criminal conduct. In response, the prosecutor argued that Chunza's lack of prior convictions was irrelevant because the court could "consider prior similar adult criminal conduct not resulting in a criminal conviction." 25 The government also argued that a departure was appropriate under Sec. 5K2.9, because Chunza had committed the false registration offense in order to facilitate or conceal the commission of his offenses in Colombia. In opposition, Singer contended that there was "absolutely no evidence" showing that Chunza was in the United States to collect drug money on behalf of Escobar. The presentence report revealed that Chunza has lived in the United States for a few years and has worked in several entry-level positions. In response to the unidentified witness's testimony that Chunza had come to the United States to collect money for Escobar, Singer urged that this testimony was unreliable because it was "remote hearsay." 26 Singer also objected to basing an upward departure on the allegation that Chunza had come to the United States to escape prosecution in Colombia. None of the arrest warrants for Chunza was issued until after he arrived in the United States. Singer contended that Chunza had fled to the United States because of attempts on his life, a claim that was supported by newspaper articles and letters that Chunza had sent to the Colombian authorities. The government admitted that it had inferred that Chunza had come to the United States to avoid prosecution, because it believed, without sufficient evidence, that the three arrest warrants for Chunza had been issued or authorized before he left Colombia. However, the government was wrong, because the warrants were not issued until nearly two-and-one-half years later, in March 1993. 27 After hearing the arguments of both counsel, Judge Nickerson agreed with the government and stated that 28 it seems to me that certainly by a preponderance of the evidence Mr. Chunza was a member of the Medellin Cartel. He committed criminal acts at the behest of Mr. Pablo Escobar and came to the United States both to assist Escobar in collecting money--and I think it's a fair inference that he also came to the United States to avoid further prosecution. It's a fair inference even if the warrants were issued afterwards that he knew he was going to be subject to prosecution. 29 The judge found that this evidence warranted upward departures, to criminal history category IV and offense level 20, so he sentenced Chunza to two, concurrent, five-year prison terms, three years' supervised release, and a $100 mandatory special assessment. Chunza argues that his criminal history category and offense level were improperly increased and that his sentence should therefore be vacated. DISCUSSION 30 The central argument of Chunza's appeal is that an upward departure from his 0-6 months guideline range could not properly be based on foreign criminal conduct of which he had not been convicted.A. Criminal History Category 31 The district court's reliance on Chunza's activities in Columbia was an improper basis for increasing Chunza's criminal history category. Chapter IV of the sentencing guidelines addresses defendants who have a record of past criminal conduct. 32 Under Sec. 4A1.1, a defendant's record of prior sentences is relevant to determine a defendant's criminal history category. Section 4A1.1 provides: "[T]he total points from items (a) through (f) determine the criminal history category in the Sentencing Table in Chapter Five, Part A." Items (a) through (f) all mention adding a specific number of points either for each prior sentence of imprisonment or for committing the crime shortly after or while on release from a sentence. Section 4A1.2(1) defines prior sentence as "any sentence previously imposed upon adjudication of guilt, whether by guilty plea, trial, or plea of nolo contendre, for conduct not part of the instant offense." 33 Chunza, however, had never been sentenced or convicted in the United States, Colombia, or elsewhere. As a result, Sec. 4A1.1 of the guidelines did not authorize consideration of Chunza's other conduct in the calculation of his original history category. 34 The guidelines also give special attention to the role of foreign convictions and sentences in determining criminal history category. Section 4A1.2(h) provides: "Sentences resulting from foreign convictions are not counted", but they may be considered under Sec. 4A1.3 (Adequacy of Criminal History Category). That section, in turn, permits an upward departure in the guideline range, suggesting the type of "reliable information" that might be used: 35 (a) prior sentence(s) not used in computing the criminal history category (e.g., sentences for foreign and tribal offenses); 36 (b) prior sentence(s) of substantially more than one year imposed as a result of independent crimes committed on different occasions; 37 (c) prior similar misconduct established by a civil adjudication or by a failure to comply with an administrative order; 38 (d) whether the defendant was pending trial or sentencing on another charge at the time of the instant offense; 39 U.S.S.G. Sec. 4A1.3 (emphasis added). Thus, not even foreign sentences may be used initially in determining the criminal history category, but they may be used, like a pending charge, as the basis for an upward departure. In light of these precise provisions as to how charges and foreign sentences may be used, it is significant that nowhere do the guidelines specifically authorize the use of unrelated, uncharged foreign criminal conduct, or even foreign arrests, for a departure in the criminal history category. 40 Thus, there was no appropriate foundation for an upward departure under the first four subdivisions of Sec. 4A1.3. The only other express possibility for raising Chunza's criminal history category is under the fifth subdivision, subsection (e), which suggests that the court might consider "reliable information" about "(e) prior similar adult criminal conduct not resulting in a criminal conviction." U.S.S.G. Sec. 4A1.3(e) (emphasis added). 41 Even assuming that subsection (e) might reasonably be extended to include criminal conduct in a foreign country, a court might properly consider that conduct only if it is "similar" to the crime of conviction. Chunza's alleged prior acts of homicide, terrorism, and drug trafficking in Colombia are not "similar" to his possession of false immigration documents in the United States. 42 Chunza distinguishes his situation from United States v. Mayo, 14 F.3d 128, 131 (2d Cir.1994), where we held that the district court did not err in increasing the defendant's criminal history category based on similar prior conduct. We recognized that while "prior conduct need not have been of an identical type" for an upward departure, it must have been similar. Id. We found that the defendant's prior arsons committed to prevent the auditing of his financial records were fraudulent conduct that was similar to the frauds underlying the convictions and that this warranted an upward departure, because "the difference between a fraud designed to obtain loans in the first place and a fraud designed to avoid their repayment is a variation that does not bespeak dissimilarity." Id. at 132. 43 In contrast here, however, Chunza's alleged acts of terrorism, homicide, and drug dealing in Colombia were not similar to his possessing false U.S. immigration and social-security documents in Staten Island. The government seeks to treat Chunza's activities in Colombia as similar to possessing the false documents by arguing that he came to the United States to avoid punishment for his misdeeds in Colombia and to pursue his criminality on behalf of the Medellin cartel, and that he used the documents to "legitimize" his presence here. The argument lacks force for two reasons. First, the arrest warrants were not issued until March of 1993, after Chunza had been in the United States for more than two years, and the government presented no additional evidence that Chunza had fled Colombia two years earlier to avoid prosecution there. Second, Sec. 4A1.3(e) requires conduct that is "similar" to the convicted conduct, not conduct that was designed to further other, dissimilar, criminal conduct. 44 The government also argues that even if Chunza's acts in Colombia were dissimilar to his possessing false green cards, our decision in United States v. Diaz-Collado, 981 F.2d 640, 644 (2d Cir.1992), cert. denied, --- U.S. ----, 113 S.Ct. 2934, 124 L.Ed.2d 684 (1993), authorizes a departure based on nonsimilar prior criminal conduct. Diaz-Collado, however, dealt with convictions, not conduct. Id. As we then noted, "under certain circumstances nonsimilar outdated convictions may be used as a basis for departing from the [g]uidelines." Id. (emphasis added). Here, we reject the government's attempt to extend Diaz-Collado to authorize use of nonsimilar conduct that did not result in a conviction. B. Offense Level 45 Chunza also contends that the district court erred in departing upward 16 levels on his offense level. 46 In United States v. Azeem, 946 F.2d 13, 16 (2d Cir.1991), the defendant claimed that his heroin activities in Egypt should not have been counted in fixing his base offense level because (1) they were not part of the same conspiracy of which he was convicted and (2) the heroin transaction in Egypt was not a crime against the United States. On the first claim, we held that the district court did not err in finding the Egyptian conspiracy was part of the same crime as Azeem's offense of conviction in the United States. On the second count, however, we held that the Egyptian transaction "should not have been included in the base offense level calculation because it was not a crime against the United States." Id. We further reasoned that 47 Congress, while it has not remained entirely silent, has chosen to assign to foreign crimes a rather limited role * * * [t]here are good reasons to avoid creating a new use for foreign crimes in sentencing. To do so would require distinguishing between activities that violate both domestic and foreign law and those which violate only domestic law or only foreign law. * * * To permit foreign crimes to figure in fixing the base offense level would require courts to perform a careful comparative analysis of foreign and domestic law in such instances. At some point the advantages of simplicity should prevail. Id. at 17. Finally, we held 48 [w]ithout a clear mandate from Congress, we decline to create the complexities that the inclusion of foreign crimes in the base offense level calculation would generate. These issues are best considered and resolved by Congress. 49 Id. at 18. Although we are confident that homicide is prohibited by both domestic and Colombian law, we are less certain that courts in the United States are in a good position to assess the reliability of Colombian arrest warrants. 50 The same considerations considered in Azeem with respect to base offense level, should guide our determination of whether Chunza's conduct in Colombia may be considered for an upward departure. Like Azeem's Egyptian conspiracy, Chunza's illegal activities in Colombia were not crimes against the United States, and therefore should not be included in the guideline calculation. Moreover, while Azeem's Egyptian heroin conspiracy was viewed as part of the same course of conduct underlying his United States activity, Chunza's possession of the fraudulent registrations and the counterfeit social-security cards was not part of the same crimes as committing homicide and terrorist acts for the Medellin cartel in Colombia. Thus, the reasons for excluding consideration of Chunza's foreign conduct are even stronger than the circumstances in Azeem. 51 The government finally seeks to justify the upward offense level departure under Sec. 5K2.9. That section states: 52 If the defendant committed the offense in order to facilitate or conceal the commission of another offense, the court may increase the sentence above the guideline range to reflect the actual seriousness of the defendant's conduct. 53 U.S.S.G. Sec. 5K2.9. The government asserted two contradictory views of the evidence in its zeal to show that both parts of Sec. 5K2.9 ("facilitate or conceal") applied to Chunza. First, the government contended that Chunza's possession of the false documents was designed to facilitate the commission of another offense--coming to the United States "to assist Escobar in collecting money." Second, the government argued that the court should upwardly depart because Chunza had fled from Colombia to the United States to avoid prosecution for the crimes committed in Colombia. 54 The government's two theories are irreconcilable. If Chunza had come to the United States in 1990 to escape prosecution, he would not have been working for Escobar in Colombia in February of 1993. If Chunza was in Colombia in February 1993, as revealed by the evidence submitted by the government in support of its facilitation theory, planning to come to the United States to collect money for Escobar, he could not at the same time have been hiding out here in the United States. Other than the triple-hearsay statement of the unidentified witness, about the unexplained "Universal" report, the government lacks evidence to support its money-collection theory, and it admits that it does not have proof that Chunza came to this country to avoid prosecution. While it originally inferred that Chunza was wanted by the Colombian authorities, in 1990, when he came to this country, it finally conceded that the arrest warrants were issued against him only in March of 1993, more than two years after he left Colombia. 55 Chunza's conduct in this country was manifestly inconsistent with that of a person hiding from the authorities; the government did not produce any reliable evidence to show that Escobar actually sent Chunza to the United States to collect money for him; the only evidence of a possible drug-related crime in the United States was the triple-hearsay statement of the "witness with [an] undisclosed identity". Although a sentencing court may consider hearsay, the uncorroborated evidence offered here neither rises to an acceptable standard of reliability, nor establishes that Chunza ever collected any money for Escobar. Thus, the 16-level upward departure in offense level under Sec. 5K2.9 was improper. CONCLUSION 56 We vacate the sentencing court's upward departure from 6 months to 60 months, which was based on unrelated foreign conduct and insufficient triple-hearsay testimony about Chunza's being sent here to collect money for Escobar. 57 Remanded for resentencing consistent with this opinion.	{ "pile_set_name": "FreeLaw" }
767 So.2d 135 (2000) Catina N. ADAMS, Mary M. Allen, Hyllorri Dawn Monique Armant, Lardez Monique Armant and Daphne M. Adams on their own Behalf and on Behalf of all other Persons Similarly Situated v. CYTEC INDUSTRIES, INC. and Walk, Haydel & Associates, Inc. No. 99-CA-2563. Court of Appeal of Louisiana, Fourth Circuit. June 14, 2000. 136 Paul G. Aucoin, Road Vacherie, Louisiana, (Attorney for Plaintiffs/Appellants). Frank H. Walk, Jr., Walk, Haydel & Associates, Inc., New Orleans, Louisiana, (Attorney for Defendant/Appellee, Walk, Haydel & Associates, Inc.). Court composed of Judge CHARLES R. JONES, Judge MOON LANDRIEU and Judge PATRICIA RIVET MURRAY. MURRAY, Judge. Plaintiffs appeal a judgment granted in favor of defendants, Cytec Industries, Inc., and Walk/Haydel & Associates, Inc., dismissing their lawsuit pursuant to La.Code Civ. Proc. art 561. For the following reasons, we dismiss plaintiffs' appeal. FACTS AND PROCEDURAL HISTORY: This case involves a class action filed on behalf of Catina N. Adams, Mary M. Allen, Hyllorri Dawn Monique Armant, Lardez Monigue Armant, and Daphne M. Adams, and others similarly situated. The petition was filed on January 16, 1996, and bears docket no. 96-631, Div. M. Each of the two defendants was served properly. Defendant Cytec Industries, Inc., filed a motion for extension of time on February 12, 1996, and has never answered the suit. Defendant Walk/Haydel & Associates, Inc., filed an answer on May 26, 1996. On June 3, 1999, counsel for Walk/Haydel filed an Ex Parte Motion for Order of Dismissal, with an accompanying affidavit stating that no action in the prosecution or defense of the case had been taken since May 28, 1996. The trial court judge for Division M, Ethel S. Julien, signed the order of dismissal on June 3, 1999. Plaintiffs filed a motion to set aside the order of dismissal on July 16, 1999, and the trial court set the matter for hearing on September 10, 1999. However, on July 30, 1999 plaintiffs filed a petition for appeal, which was granted. DISCUSSION: Article 2083 of the Louisiana Code of Civil Procedure provides that appeals may be taken from final judgments rendered after hearing or by default, from interlocutory judgments, that may cause irreparable harm, and from judgments reformed in accordance with a remittitur or additur under Article 1814. 137 Louisiana Code of Civil Procedure art. 1841 provides that a judgment that determines the merits of an action, in whole or in part, is a final judgment. A judgment that does not determine the merits of a case but merely preliminary matters is an interlocutory judgment. An ex parte judgment dismissing an action pursuant to La.Code Civ. Proc. art. 561 does not determine the merits of the action, and, is therefore, an interlocutory judgment. Picone v. Lyons, 618 So.2d 475 (La.App. 4 Cir.1993), citing Simmons v. Dixon, 306 So.2d 67 (La.App. 1 Cir.1974). Prior to the 1997 amendment to Article 561, courts routinely held that a party aggrieved by an ex parte dismissal was to petition the trial court to conduct a contradictory hearing as to whether the order of dismissal should be set aside. Then, after a hearing is held, if the trial court's ruling is still adverse to the aggrieved party, it may then appeal the judgment of the rule to show cause. Scarborough v. Duke, 514 So.2d 489, 490 (La.App. 3 Cir.1987); Marchand v. Gene Thorpe Finance, Inc., 225 So.2d 485 (La.App. 4 Cir.), writ refused 254 La. 848, 227 So.2d 592 (La.1969); Simmons v. Dixon, supra at 70. This procedure was codified with the 1997 legislative amendment to Article 561. La. Acts 1997, No. 1221, § 1. Thus, once an order of dismissal is served, a plaintiff has thirty days within which to move to set aside the dismissal. Once a judgment is rendered after a contradictory hearing, the plaintiff has a final judgment from which it may appeal. In the instant case, plaintiffs did move to have the order of dismissal set aside, albeit untimely, but before a hearing was had on the matter, plaintiffs filed a petition for appeal. As such, plaintiffs have appealed from an interlocutory judgment, which we find is not appealable because there has been no showing made of irreparable harm. Accordingly, we dismiss the appeal. For the foregoing reasons, this appeal is dismissed, at plaintiffs' costs. The case is remanded for hearing on the timeliness and merits of plaintiffs' motion to set aside the order of dismissal. APPEAL DISMISSED; REMANDED.	{ "pile_set_name": "FreeLaw" }
UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 98-1055 STANLEY CASTEEL, Petitioner, versus DIRECTOR, OFFICE OF WORKERS' COMPENSATION PRO- GRAMS, UNITED STATES DEPARTMENT OF LABOR; T&T COALS, INCORPORATED; WEST VIRGINIA COAL WORKERS, Pneumoconiosis Fund, Respondents. On Petition for Review of an Order of the Benefits Review Board. (96-932-BLA) Submitted: March 12, 1998 Decided: March 26, 1998 Before LUTTIG, WILLIAMS, and MICHAEL, Circuit Judges. Affirmed by unpublished per curiam opinion. Stanley Casteel, Petitioner Pro Se. Patricia May Nece, Jennifer U. Toth, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C.; Konstan- tine Keian Weld, OFFICE OF THE ATTORNEY GENERAL OF WEST VIRGINIA, Charleston, West Virginia, for Respondents. Unpublished opinions are not binding precedent in this circuit. See Local Rule 36(c). PER CURIAM: Appellant seeks review of the Benefits Review Board's decision and order affirming the administrative law judge's denial of black lung benefits pursuant to 30 U.S.C.A. §§ 901-945 (West 1986 & Supp. 1996). Our review of the record discloses that the Board's decision is based upon substantial evidence and is without reversible error. Accordingly, we affirm on the reasoning of the Board. Casteel v. DOWCP, No. 96-932-BLA (BRB July 8, 1997). 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	{ "pile_set_name": "FreeLaw" }
460 S.W.2d 94 (1970) SECURITY LIFE AND TRUST COMPANY, Appellant, v. FIRST NATIONAL BANK IN LITTLE ROCK, Arkansas, Administrator of the Estate of Claude Lee DeLoach, Sr., deceased, Appellee. No. 5-5370. Supreme Court of Arkansas. December 7, 1970. Wright, Lindsey & Jennings by Winslow Drummond, Little Rock, for appellant. Cooper Jacoway, Little Rock, for appellee. HARRIS, Chief Justice. Claude Lee DeLoach, a resident of North Little Rock, died as a result of a gunshot wound. At the time there was in force a policy of insurance on the life of DeLoach issued by Security Life and Trust Company, appellant herein. First National Bank in Little Rock, Administrator of the Estate of DeLoach, and appellee herein, instituted suit against appellant in the Pulaski County Circuit Court, asserting that DeLoach died an accidental death and that the administrator was entitled to recover on the policy in the amount of $8,200.00 plus statutory penalty and an attorney's fee. Appellant denied the allegation that the death was accidental, and affirmatively pleaded that DeLoach's death was suicide. The policy provided for a refund of premium in the event of self-destruction, and appellant tendered $125.02 into the registry of the court. On trial, the sole issue was whether the death of DeLoach was the result of an accident or whether it was a suicide. Instructions including three which are involved in this appeal, were given. Plaintiff's instruction number two and instructions number three[1] and eight, given by the court, are as follows: "The term `self destruction' as it is used in the insurance policy, means the same thing as `suicide'. In order for the insurance company to establish that Claude DeLoach died as a result of his self destruction, the company must prove to you that Claude DeLoach committed suicide. * * * * * * You are instructed that suicide is more than the taking of one's own life, it is the intentional taking of one's own life. For a death to be suicide, the law requires that the decedent possess the intention of taking his own life at the moment of the action that resulted in his death. 95 In this case, the insurance company claims that the death of Claude DeLoach resulted from his suicide. In order to establish this claim, the insurance company is required to prove by a preponderance of the evidence that Claude DeLoach had the intention to kill himself at the moment that the gun fired the bullet that killed him. If the insurance company fails to prove to you, by a preponderance of the evidence, that Claude DeLoach possessed that intention at the moment that the gun fired, then, in such event, your verdict will be for the plaintiff in the sum of $8,200.00. * * * * * A party who has the burden of proof on a proposition must establish it by a preponderance of the evidence, unless the proposition is so established by other proof in the case. `Preponderance of the evidence' means the greater weight of evidence. The greater weight of evidence is not necessarily established by the greater number of witnesses testifying to any fact or state of facts. It is the evidence which, when weighed with that opposed to it, has more convincing force and is more probably true and accurate. If, upon any issue in the case, the evidence appears to be equally balanced, or if you cannot say upon which side it weighs heavier, you must resolve that question against the party who has the burden of proving it." Appellee then offered four instructions relating to the presumption against suicide. Plaintiff's requested instruction number five, probably more comprehensive than the others, reads as follows: "There is a presumption against suicide, or death by any other unlawful act, and this presumption arises even where it is shown by proof that death was self-inflictedthe death is presumed to have been accidental until the contrary is made to appear. This rule is founded upon the natural human instinct or inclination of self-preservation, which renders self-destruction an improbability with a rational being." All four of these requested instructions were refused. The jury returned a verdict for appellant, and a few days later, appellee filed its motion for a new trial, the motion being based upon the contention that the court erred because of failure to give the instructions relating to the presumption against suicide. On hearing, the court set aside the verdict of the jury and the judgment based thereon, and reinstated the case for another trial. From this judgment of the court, appellant brings this appeal. For reversal, it is simply asserted that the trial court erred in granting the motion for a new trial. While the trial court gave no reason in its order (setting aside the verdict and judgment), the only ground urged by appellee in filing its motion was as previously stated and we treat the matter accordingly. First, let it be said that there is no dispute but that the instructions concerning the presumption against suicide offered by appellee, were a correct statement of the law. Appellant simply asserts that the instructions already given by the court, set forth earlier in this opinion, in effect, sufficiently covered the point sought to be covered by appellee in offering its instructions on the presumption against suicide. This is the principal argument advanced by appellant, viz, that the instructions were repetitive of those already given, although it is also mentioned that they were argumentative. It is suggested that the existence of legal presumptions is subject matter for law students, lawyers, and judges, but not for jurors. We do not agree with these contentions for reasons hereafter set out. Appellant relies principally upon one Arkansas case, Watkins v. Metropolitan Life Ins. Co., 158 Ark. 386, 250 S.W. 350 (1923), and argues that that case is dispositive of this appeal. There, this court held that the trial court did not commit error in refusing to give an instruction 96 on the presumption against suicide, holding that the instruction was argumentative.[2] We added that there could have been no prejudice since other instructions correctly covered the law embraced in the requested instruction. The other instructions mentioned were similar to the instructions given in the instant case. We agree that the instruction which the court refused to give, set out in footnote 2, is argumentative, in that it says "this makes a prima facie case for the plaintiff", and should not have been given. That vice does not appear in the instructions offered by appellee in the case before us. However, entirely aside from that, appellant's reliance upon Watkins is ill-founded for the reason that the original transcript establishes that the following instruction was given: "1. While the law presumes that a man will not intentionally kill himself, this presumption is only prima facie, and not conclusive, and may be overcome by evidence either direct or circumstantial introduced in proof in the case[3]." It might be added that presumption against suicide instructions have been approved in numerous cases subsequent to Watkins. The law recognizes that there are two kinds of presumptions, statutory presumptions and presumptions based upon human experience. In Union Central Life Ins. Co. v. Sims, 208 Ark. 1069, 189 S.W. 2d 193, this court said: "From these cases it is apparent that a distinction is drawn between the effect to be given presumptions founded upon the laws of nature, and those which would not ordinarily arise but for the interposition of a statutory declaration. Where the presumption is a matter of public policy promulgated by the Legislature, it disappears when substantial evidence of facts is introduced; but since the laws of nature and of self-preservation are instinctive, a presumption predicated upon them may not be peremptorily brushed aside by mere contradiction. We think the effect of our decisions where accidental death or suicide were matters of controversy is that the presumption against suicide exists throughout trial, placing upon the insurer the burden of proving its affirmative defense." Of course, there are different presumptions, some of which are overcome with a minimum of proof, almost by simply offering some evidence contrary to the presumption. But the presumption against suicide is a strong one as pointed out in the case just cited. The principle is even more forcefully stated in Metropolitan Life Insurance Company and National Life & Accident Insurance Company v. Graves, 201 Ark. 189, 143 S.W.2d 1102, where Justice Mehaffy, speaking for the court, and quoting from 8 Couch on Insurance, 7242, said: "Another apt statement of the rule is that where the cause of death is unexplained or undisclosed by evidence, or where evidence tending to prove self-destruction is contradicted, or impeached, or some evidence adduced is consistent with a reasonable hypothesis that the death was not self-caused, [Our emphasis] the presumption against suicide 97 prevails. And if there be a doubt, the evidence being conflicting and nearly evenly balanced, whether the death was caused by suicide or accident, the presumption is in favor of accident. So, where the evidence points equally or indifferently to accident or suicide, the theory of accident is adopted. And the force of the presumption based upon the love of life must, it is decided, be given effect against the defense of suicide, unless the evidence discloses no other reasonable hypothesis. [Our emphasis]" In addition to Arkansas cases, decisions are cited from several other states, along with federal cases including two from the United States Supreme Court. When we reflect upon human emotions and desires, it is little wonder that our cases use such strong language, for we have all heard from childhood that "self-preservation is the first law of nature". Metropolitan Life Insurance Company and National Life & Accident Insurance Company v. Graves, supra, points out that the presumption against suicide must be given effect unless the evidence discloses no other reasonable hypothesis. The testimony in the present case is not abstracted but it is sufficient to say that evidence was offered on behalf of appellee which, if believed by the jury, would have supported the theory of accident. It will be noted that in Union Central Life Ins. Co. v. Sims, supra, it is pointed out that a presumption based upon the laws of nature and self-preservation are not to be "peremptorily brushed aside by mere contradiction". Instructions that simply tell the jury that before it can find for the insurance company, it must find by a preponderance of the evidence that the deceased intentionally killed himself may not always be sufficient, unless such instructions are accompanied by a proper instruction on the presumption against suicide. For instance, let us say that a hunter is found dead in the woods, death being caused by a shotgun blast which tore off part of his head. The body is near a tree, with the fired gun lying between the tree and the body. No one can say whether the man committed suicide, or was accidentally killed, perhaps by the gun being accidentally discharged when falling to the ground from where it was propped against the tree. But there is a witness who testifies for the defendant insurance company that the deceased had told him the day before that his wife was "running around with another man and that if she didn't quit, he was going to kill himself". Certainly, that is a circumstance supporting the defense of suicide; in fact under the hypothetical facts just related, it would constitute the preponderance of the testimony for no evidence was offered as to the cause of death (accident, murder, or suicide) by the representative of the deceased. Thus, without an instruction on the presumption against suicide, the defendant would clearly have the preponderance of the testimony, but should it prevail? It may well be that the circuit judge, who had heard all the testimony in the case, was somewhat surprised at the verdict, and concluded that his instructions had not sufficiently apprised the jury of the law, and that he had made a mistake in not giving an instruction upon presumption against suicide. For that matter, we have said many times that we will not disturb the trial court's action in setting aside a verdict unless the court has clearly abused its discretion. This is of course, also applicable where a judge determines that he should have, in the original trial, given a requested instruction and grants a new trial for that reason. In Hardin v. Pennington, 240 Ark. 1000, 403 S.W.2d 71, the trial judge decided that he should have given the appellee's requested instruction No. 5, and he accordingly granted a new trial. This court, in affirming, made no finding that error had been originally committed and that the instruction should have been given; rather, we said: "The trial judge, in granting a new trial, explained in detail that he had *98 refused to give the appellee's requested Instruction No. 5 and he did not think that the giving of any other instruction properly presented the issues. It is sufficient to say that the court in its sound discretion exercised its inherent power to grant a new trial; and that it is not shown that he acted arbitrarily in this case." This language is apropos in the case now before us for the court exercised its sound discretion in its power to grant a new trial and it is not shown that he acted arbitrarily. We are not saying that the court should have given all of the instructions on presumption against suicide offered by appellee, nor are we saying that any of those specific instructions should have been given (though they seem to correctly state the law). We are saying that the trial court, exercising its discretion, was justified in granting a new trial by determining that appellee was entitled to have the jury told that there is a presumption against suicide. Affirmed. NOTES [1] Requested instruction number three was modified before being given as set out in this opinion. [2] "5. If you find from the evidence that deceased was found with pistol-shot wound in his head, which caused his immediate death, this makes a prima facie case for the plaintiff, because the law presumes that one does not commit suicide, even where the wound is self-inflicted. Such presumption of evidence stands until overthrown by evidence that deceased intentionally shot himself." [3] While clearly stating to the jury the legal presumption against suicide, it is interesting to note that the instruction seems somewhat slanted toward the side of the defendant. The record reveals that the instruction was given at the request of the defendant.	{ "pile_set_name": "FreeLaw" }
403 F.3d 57 Darnell DeBERRY, Petitioner-Appellant,v.Leonard A. PORTUONDO, Respondent-Appellee. No. 03-2418. United States Court of Appeals, Second Circuit. Argued: May 11, 2004. Decided: April 4, 2005. COPYRIGHT MATERIAL OMITTED Richard Ware Levitt, New York, NY, for Petitioner-Appellant. Victor Barall, Assistant District Attorney, Kings County, Brooklyn, N.Y. (Charles J. Hynes, District Attorney, and Leonard Joblove, Assistant District Attorney, on the brief), for Respondent-Appellee. Before: WALKER, Chief Judge, OAKES and POOLER, Circuit Judges. Affirmed. Chief Judge WALKER concurs in a separate opinion. POOLER, Circuit Judge. 1 Darnell DeBerry seeks habeas relief based on a Batson claim centering on peremptory challenges to four African-American jurors. See Batson v. Kentucky, 476 U.S. 79, 106 S.Ct. 1712, 90 L.Ed.2d 69 (1986). The Batson Court held that "the Equal Protection Clause forbids the prosecutor to challenge potential jurors solely on account of their race or on the assumption that black jurors as a group will be unable impartially to consider the State's case against a black defendant," id. at 89, 106 S.Ct. 1712, and defined a three-step process for assessing a claim of racial bias in a peremptory challenge, id. at 96-98, 106 S.Ct. 1712. First, the defendant must allege facts suggesting that purposeful discrimination has occurred. Id. at 96, 106 S.Ct. 1712. Once the defendant has made out this prima facie case, the prosecutor "must articulate a neutral explanation related to the particular case to be tried." Id. at 98, 106 S.Ct. 1712. "The trial court then will have the duty to determine if the defendant has established purposeful discrimination." Id. 2 Because the record initially suggested that the trial judge erred in applying Batson, Judge Leonard B. Sand1 directed a reconstruction hearing before Magistrate Judge Cheryl L. Pollak. DeBerry v. Portuondo, 2002 WL 31946703 (E.D.N.Y. Oct.21, 2002) ("DeBerry II"). At that hearing, the trial judge, New York Supreme Court Justice Edward K. Pincus, testified to the factual findings he made at trial and to his understanding and application of Batson. Applying the deferential standard of review imposed by the Antiterrorism and Effective Death Penalty Act of 1996, Pub.L. No. 104-132, 110 Stat. 1214 (1996) ("AEDPA"), Judge Sand held that Justice Pincus reasonably applied Batson and that his credibility findings were entitled to deference and therefore denied the writ. DeBerry v. Portuondo, 277 F.Supp.2d 150 (E.D.N.Y.2003) ("DeBerry III"). We affirm. BACKGROUND Proceedings in the State Courts 3 A grand jury charged DeBerry and a co-defendant, Eric Jeffrey, with murder in the second degree and criminal possession of a weapon in the second and third degrees. At trial, the prosecutor, Jeff Kern, exercised three peremptory challenges to the first panel of prospective jurors without objection from defense counsel. During the first phase of the second round, Kern peremptorily challenged three additional jurors — Mr. Archibald, juror number three; Ms. Smith, juror number seven, and Ms. Buckner, juror number eight. Jeffrey's attorney, George Sheinberg, then lodged a Batson challenge, claiming that "[e]very challenge the People have taken first round and in this round have been individuals who are black." DeBerry's attorney, Michael Harrison, joined in Sheinberg's argument. Justice Pincus said, without contradiction from defense counsel, "I believe we do have black jurors."2 The judge also noted that defendants had not challenged the peremptories that the prosecutor exercised in the first round. Sheinberg responded, "I wouldn't raise it the first challenge." 4 Without explicitly determining whether the defendants had established a prima facie basis for a Batson challenge, Justice Pincus required the prosecutor to offer a race-neutral basis for challenging each of the three jurors he excused in the second round. The prosecutor explained the challenge to Archibald as related to Archibald's age, saying that he "just wasn't comfortable having someone 20 years old judging somebody of similar age." Kern also indicated that he had kept other younger jurors on the panel. Sheinberg argued that Archibald's youth was not an appropriate basis for a challenge. Justice Pincus found the challenge to be appropriate,3 in part, because Archibald had said that his youth would help him relate to the defendants. Sheinberg replied, "All right, how about Ms. Smith." DeBerry's attorney, Harrison, made no response. Kern conceded that Smith's law enforcement background would ordinarily make her an attractive juror for the prosecution, but he claimed that he found Smith to be "stubborn, somewhat intractable so that if I didn't convince her or she was skeptical of any part of my case, she is the type of person that ... may actually hang up the jury." The judge again accepted Kern's proffered reason, and this time neither defense counsel offered further argument. 5 Kern's asserted reasons for excusing Buckner were less well defined than his reasons for excusing the first two jurors. He first said, "I am going to admit I will be hard pressed to find a reason," but added, "I didn't think her responses were as ringing as I expected." The prosecutor also explained that he had not had sufficient time to question this panel, but he declined the judge's offer to recall Buckner for further questioning. Later Kern added that Buckner was probably between forty-five and fifty, there were women on the jury in that age range, and he was trying to achieve a balanced age range. He further explained that he was just "not happy" with Buckner and argued that because the victim was African-American, he had "no motive ... to knock black people off the jury." Justice Pincus held that in light of the "articulate reasons" Kern offered for challenging Smith and Archibald, the plaintiffs had not established a pattern "with respect to [Buckner]." However, the judge also indicated that "[u]nhappiness ordinarily would not suffice" as a reason for a challenge that is alleged to be discriminatory. Neither defense counsel offered any further argument with respect to Buckner, and jury selection proceeded to a second phase of the second round. 6 During the second phase, Kern challenged one juror, an African-American woman, Ms. Hanson. Sheinberg, acting for Jeffrey, again lodged a Batson objection. This time DeBerry's attorney did not join. Justice Pincus ruled that because he had not found a pattern, he saw no basis for requiring Kern to give reasons for challenging Hanson. Sheinberg objected that a pattern had been established because "the only black person is being challenged [and] there are no other blacks on this jury." In response to a request for clarification from the judge, Sheinberg clarified that he meant no African-Americans "[o]n this selection." The judge then reiterated his ruling that a pattern had not been established. Defense counsel made no further argument. 7 After hearing the evidence, the jury found both defendants guilty of murder in the second degree and criminal possession of a weapon in the second degree. Justice Pincus sentenced DeBerry to a term of imprisonment of twenty-five years to life. 8 DeBerry appealed to the New York Supreme Court, Appellate Division, Second Department. He claimed two evidentiary errors, complained about inflammatory statements in the prosecutor's summation, argued that his sentence was excessive, and contended that Justice Pincus erred in his application of Batson. The Appellate Division affirmed the conviction and sentence. See People v. DeBerry, 234 A.D.2d 470, 651 N.Y.S.2d 559 (2d Dep't 1996) ("DeBerry I"). The court rejected the evidentiary and excessive sentence claims on the merits and added the following sentence: "The defendant's remaining contentions are either unpreserved for appellate review (see, People v. Allen, [629 N.Y.S.2d 1003 (N.Y.1995)]; People v. Buckley, [552 N.Y.S.2d 912 (N.Y.1990)] People v. Balls, [511 N.Y.S.2d 586 (N.Y.1986)]) or are without merit." Id. at 560. DeBerry sought leave to appeal from Judge Titone of the New York Court of Appeals, who denied his application. 656 N.Y.S.2d 743 (N.Y.1997). Later in 1997, the trial court denied DeBerry's motion to set aside his conviction, which was made pursuant to New York Criminal Procedure Law § 440.10. In January 1998, the Appellate Division, Second Department, affirmed. District Court Proceedings 9 On April 24, 1998, DeBerry filed a habeas petition in the United States District Court for the Eastern District of New York. The petition included a Batson claim as well as other claims not before us on appeal. Judge Reena Raggi, who then served as a district court judge, referred the petition to Magistrate Judge Pollak for report and recommendation. See 28 U.S.C. § 636(b)(1)(B). 10 On October 1, 2001, after appointing Richard Levitt to serve as DeBerry's pro bono counsel, Judge Pollak issued her report and recommendation. With the exception of the Batson claim, the magistrate judge recommended denying DeBerry's petition. 11 Addressing the Batson claim, Judge Pollak first rejected respondent's claim that the court was procedurally barred from considering the merits of the claim. The procedural bar argument rested on the Appellate Division's holding that the prosecutorial misconduct and Batson claims were "either unpreserved for appellate review [citing Allen, Buckley, and Balls] or are without merit," DeBerry I, 651 N.Y.S.2d at 560. Respondent argued that the particular cases the Appellate Division cited indicated that it found that each of DeBerry's Batson claims was unpreserved for review. Judge Pollak disagreed, reasoning that it was impossible to determine which of DeBerry's Batson claims the state appellate court found to be unpreserved and that, if, as the prosecutor argued, the Appellate Division found that all of the Batson claims and the prosecutorial misconduct claim were procedurally barred, the court would not have added "or are without merit" to the procedural disposition. She therefore held that the court could consider the merits of the Batson challenges. 12 On the merits, Judge Pollak held that the state trial court committed at least three errors. First, the trial court failed to explicitly determine whether the race-neutral explanations for the challenges to Archibald and Smith were pretextual. Second, after finding that the prosecutor's explanation for excusing Buckner was insufficient, the court erred by revisiting its pattern finding and by assuming that a prima facie case could be made out only by demonstrating a pattern. Finally, the court erred by disposing of the challenge to Hanson without proceeding to the second and third Batson steps, requiring the prosecutor to give a race-neutral explanation and assessing the credibility of that explanation. 13 Having identified these errors, the magistrate judge recommended that the district court direct a reconstruction hearing at which the prosecutor's intent could be determined. She noted that both the assistant district attorney who prosecuted DeBerry and Justice Pincus were available to testify, but suggested that if the prosecutor's intent could not be reconstructed, the court should order a new trial. Finally, the magistrate judge suggested a hearing in district court rather than a remand to state court "because such a hearing may require that the trial judge be called as a witness." 14 Judge Sand, who replaced Judge Raggi as the assigned district court judge after her appointment to this court, adopted Judge Pollak's recommendations in their entirety and directed her to hold a reconstruction hearing to "determine the prosecutor's intent when the jury was selected." DeBerry II, 2002 WL 31946703, at *2. However, before the hearing was conducted, respondent notified Judge Pollak that Kern could not provide any further explanation of his challenge to Hanson. 15 Kern did not testify at the reconstruction hearing. Indeed, the only witness was Justice Pincus, who elaborated on his Batson rulings and his understanding of Batson. He explained that Batson required that challenges be "race neutral, gender neutral, sexual orientation neutral, national origin neutral" and that "in order to be a challenge, there had to be a pattern." Respondent's attorney asked whether by "pattern," the judge was referring to "the threshold prima faci[e]" showing. The judge answered that he was. 16 Despite Justice Pincus's understanding that an attorney could not be required to explain his challenges unless a pattern were demonstrated, his ordinary practice was to ask for an explanation as soon as the opposing attorney made a challenge. He initially followed this practice during the DeBerry-Jeffrey trial. 17 Justice Pincus next addressed the challenges to each juror. He testified that he believed Kern's explanation for excusing Archibald and that if he had not believed the explanation, he would have put Archibald on the jury. When Scheinberg responded "all right" after the judge indicated that the Archibald challenge was appropriate, Justice Pincus believed that Scheinberg also accepted the prosecutor's reason. 18 Further, the judge accepted Kern's reason for challenging Smith as "credible" and "race neutral." He believed the prosecutor both because of the reasons he gave and because "[Kern] is a well-known — was a very experienced District Attorney, very professional, who only raised challenges when he felt there should be challenges." Justice Pincus also testified that he would have considered a further argument from defense counsel if he had made one. 19 In discussing Buckner, the judge testified that he had not found a pattern by the time Kern explained his sense of discomfort. He failed to find a pattern based on "the regular demographics of the jury panel" and recalled that "there were some blacks picked the first round." Despite the judge's statement that Kern's uneasiness would not ordinarily be sufficient to rebut a Batson challenge, he also found "Kern's explanation to be truthful as race neutral." He believed that Kern was simply unhappy with Buckner and that he wanted the jury to be balanced between different age groups. The judge also testified that even without a pattern, he would have seated Buckner if he had found Kern's explanation to be incredible. Based on Scheinberg's "all right" after the prosecutor's explanation, Justice Pincus believed that Scheinberg also accepted the prosecutor's explanation. 20 Justice Pincus explained that he declined to ask for reasons for the Hanson challenge because he had not found a pattern.4 In making the determination that there was no pattern, the judge considered Kern's explanations for excusing the other jurors as well as defense counsel's failure to make any claim concerning the first round of challenges. He later defined "pattern" as "specifically rejecting jurors, challenging them... based on race, religion, national origin or a sexual orientation." 21 Following the hearing, Judge Pollak recommended denial of the petition. She credited Justice Pincus's testimony that he had found the prosecutor's reasons for excusing Archibald, Smith, and Buckner to be race neutral and credible. Judge Pollak also found that petitioner failed to show by clear and convincing evidence that Justice Pincus's factual findings were erroneous or constituted an unreasonable determination of the facts. Finally, because of gaps in the record concerning the number of black jurors who were actually seated and the lack of Supreme Court precedent directly on point, the magistrate judge held that Justice Pincus had not unreasonably applied Supreme Court law when he declined to require Kern to explain his challenge to Hanson. Judge Sand thoroughly reviewed both the magistrate judge's factual findings and her conclusions of law. See DeBerry III, 277 F.Supp.2d 150. Like Judge Pollak, he held that Justice Pincus had made the required credibility findings concerning Kern's explanations for excusing Archibald, Smith, and Buckner. Id. at 158-62. Judge Sand, however, took a slightly different approach to evaluating the reasonability of Justice Pincus's treatment of the Hanson challenge. He held that it would not have been objectively unreasonable for the trial court to find that any prima facie inference of discrimination "had been dispelled" by the credible reasons offered for excusing Smith and Archibald, the judge's knowledge of Kern's general credibility, and the fact that both the victim and the defendants were African-American. Id. at 163 & n. 10. Finding the issues to be close, Judge Sand granted a certificate of appealability. Id. at 163. 22 DeBerry filed a timely appeal. He argues both that the state court unreasonably applied Batson and that its determination of the facts was unreasonable in light of the evidence. See generally 28 U.S.C. § 2254(d). In addition to defending the state court's findings and holdings, respondent argues that DeBerry's claims are procedurally barred and waived. DISCUSSION 23 I. Procedural bar. 24 A habeas court may not reach a petitioner's federal claim if the judgment of the state court "rests on a state law ground that is independent of the federal question and adequate to support the judgment," Coleman v. Thompson, 501 U.S. 722, 729, 111 S.Ct. 2546, 115 L.Ed.2d 640 (1991), unless the petitioner shows cause for his default and prejudice as a result of the alleged violation of federal law, or the petitioner demonstrates a fundamental miscarriage of justice, id. at 746-51, 111 S.Ct. 2546. Where a decision "fairly appear[s] to rest primarily on federal law, or to be interwoven with the federal law, and when the adequacy and independence of any possible state law ground is not clear from the face of the opinion," habeas courts presume that there is no adequate and independent state law ground supporting the judgment. Id. at 735, 111 S.Ct. 2546 (quoting Michigan v. Long, 463 U.S. 1032, 1040-41, 103 S.Ct. 3469, 77 L.Ed.2d 1201 (1983)). 25 Respondent contends that the Appellate Division held that the Batson argument with respect to Smith, Archibald, and Buckner was barred because DeBerry offered nothing to rebut the prosecutor's facially neutral explanations, and that the court refused to consider the argument with respect to Hanson because DeBerry did not join in his co-counsel's objection. DeBerry contests the adequacy of the procedural bar for the Archibald, Smith, and Buckner claims, arguing that Allen, on which the procedural bar arguably rests, is inconsistent with federal law, but he does not contest the independence or adequacy of the Buckley procedural ground, which allegedly bars Hanson claim. For all four jurors, he argues that the Appellate Division's reliance on procedural grounds is not clear from the face of its decision. 26 Reliance on an independent state procedural bar is not "clear from the face of the opinion" when a state appellate court dismisses a claim by saying, "the defendant's remaining contentions are either unpreserved for appellate review or without merit." Fama v. Commissioner of Corr. Servs., 235 F.3d 804, 811 (2d Cir.2000) (internal quotation marks and indications of alterations from the original omitted). Respondent argues that Fama does not save DeBerry's Batson claims because the cases the Second Department cited clearly demonstrate that the court relied on a procedural bar to dismiss both the Batson and summation claims.5 We need not decide whether sufficiently specific citations to the law or the record in an otherwise terse "either/or" affirmance would allow us to find a clear procedural bar because the citations are not sufficiently specific in this case. 27 In order to assess respondent's claim that the citations in the Appellate Division opinion clearly demonstrate reliance on a procedural bar, we must address in some detail the arguments petitioner and the prosecutor made to the state appellate court as well as the appellate court's ruling. In his state court appeal, DeBerry made analytically distinct claims concerning Smith, Archibald, and Buckner, on one hand, and Hanson, on the other. With respect to the first three, he argued that the court erred by failing to judge the credibility of Kern's explanation. With respect to Hanson, petitioner argued that the state court erred by refusing to require Kern to explain his challenge. 28 Based on People v. Allen, 86 N.Y.2d 101, 629 N.Y.S.2d 1003, 653 N.E.2d 1173 (1995), the prosecutor argued that DeBerry failed to preserve his claim that the trial court erred by not judging the credibility of Kern's explanations for challenging Smith, Archibald, and Buckner. The Allen court held that after a prosecutor offers a facially neutral explanation for challenging a juror, the defendant must argue that the proffered reason is pretextual. Id. at 1008. The prosecutor also argued that DeBerry did not preserve any claim concerning Hanson because DeBerry's attorney did not join in this Batson challenge. For this proposition, the prosecutor cited a number of cases including People v. Buckley, 75 N.Y.2d 843, 552 N.Y.S.2d 912, 914, 552 N.E.2d 160 (1990), in which the court held that a defendant could not rely on his co-defendant's request to preserve an objection to the trial court's refusal to charge a lesser included offense. Alternatively, the prosecutor argued that all of the Batson claims failed on their merits. 29 In respondent's view, the appellate court's citation of Allen establishes that the court declined to consider the challenges to Smith, Archibald, and Buckner because defense counsel did not specifically question the credibility of the prosecutor's explanation. However, as the magistrate judge pointed out, Sheinberg, whose Batson objection Harrison previously had joined, did question the propriety of Kern's explanation for excusing Archibald. In addition, if the state appellate court disposed of all the Batson claims and the prosecutorial misconduct claim as unpreserved, there was no reason for the court to add "or ... without merit." Thus, we agree with the magistrate judge that is "impossible to ascertain with any confidence precisely which claims the Appellate Division believed to have been disposed of by the citation to Allen," and we hold that no independent and adequate state ground bars our review of the Archibald, Smith, and Buckner claims.6 Report-Recommendation of Magistrate Judge Cheryl L. Pollak dated October 1, 2001, at 13. Having reached this conclusion, we need not determine whether the Allen ground is "adequate" and "independent." 30 The Appellate Division opinion — when read in the context of the arguments made to that court and the trial court — presents a more difficult question as to Hanson. Buckley, which the Second Department cited, holds that a "[d]efendant cannot rely on the request of a codefendant to preserve [a] claimed charge error" because strategic considerations may make a charge objectionable to one defendant but not to the other. 552 N.Y.S.2d at 914. It may be logical to infer that the Appellate Division intended to dispose of the Hanson argument with its citation to Buckley as DeBerry's counsel did not specifically join in co-counsel's objection to the Hanson peremptory challenge. Nevertheless, we conclude for two reasons that it is not clear from the face of the Appellate Division's opinion that the court rejected the Hanson claim for procedural reasons. First, the Appellate Division did not link Buckley to Hanson in any fashion. Second, the prosecutor offered both procedural and substantive reasons for affirming. Cf. Coleman, 501 U.S. at 740, 111 S.Ct. 2546 (relying on the prosecutor's arguments on a motion to dismiss to find that "the relevant state court decision does not fairly appear to rest primarily on federal law or to be interwoven with such law"). While we could draw an inference from reading the Appellate Division decision and the parties briefs that the Appellate Division relied on a procedural bar, we cannot say that its reliance is clear from the face of the opinion. 31 II. Waiver. 32 Relying on United States v. Rudas, 905 F.2d 38 (2d Cir.1990), respondent also argues that DeBerry waived his claims concerning the jurors. In Rudas, we held that once the government offers reasons for its peremptory challenges, a federal defendant must state his continuing objection. 905 F.2d at 41. For three reasons, we reject respondent's argument that Rudas governs here. First, it is factually inapposite to the Smith, Archibald, and Buckner claims: DeBerry, through co-counsel, objected to the prosecutor's reason for challenging Archibald; the district court found as a matter of fact that the trial court cut off any further objection to the challenge to Smith; and Justice Pincus testified that he ruled on the credibility of the prosecutor's explanations, obviating the need for defense counsel to make a further objection. Second, respondent seeks to import a federal procedural rule into our Section 2254 review of a state court decision. However, on Section 2254 review, we rely on state, not federal, procedural rules. Thus, a waiver on which the state court did not explicitly rely will not bar our review of the merits of a claim. Cf. Galarza v. Keane, 252 F.3d 630, 637 (2d Cir.2001) (rejecting contention that petitioner waived his Batson claim by not quarreling with the prosecutor's explanation because the state court did not explicitly rely on a procedural bar). Finally, Rudas, which concerned steps two and three in the Batson analysis, would not apply, even in a federal proceeding, to the Hanson challenge, which was resolved at step one of the Batson analysis. See Rudas, 905 F.2d at 41. Therefore, we hold that DeBerry did not waive his claims. 33 III. Standard of review. 34 We review the district court's factual determinations for clear error and its denial of the writ de novo. Jenkins v. Artuz, 294 F.3d 284, 290 (2d Cir.2002). In a case governed by AEDPA, a habeas court may grant the writ "with respect to any claim that was adjudicated on the merits in State Court" only if 35 the adjudication of the claim — 36 (1) resulted in a decision that was contrary to, or involved an unreasonable application of, clearly established Federal law, as determined by the Supreme Court of the United States; or 37 (2) resulted in a decision that was based on an unreasonable determination of the facts in light of the evidence presented in the State court proceeding. 38 28 U.S.C. § 2254(d). A state court's factual finding enjoys a "presumption of correctness" that the petitioner must rebut by clear and convincing evidence. 28 U.S.C. § 2254(e)(1). 39 However, if a federal claim has not been adjudicated on the merits, AEDPA deference is not required. See Miranda v. Bennett, 322 F.3d 171, 178 (2d Cir.2003). Absent AEDPA deference, conclusions of law and mixed findings of fact and conclusions of law are reviewed de novo. Oppel v. Meachum, 851 F.2d 34, 37 (2d Cir.1988) (per curiam); Torres v. Berbary, 340 F.3d 63, 68 (2d Cir.2003). But, even without AEDPA-mandated deference, the state court's credibility assessment of a prosecutor's explanation for challenging a juror merits "great deference." Hernandez v. New York, 500 U.S. 352, 364, 111 S.Ct. 1859, 114 L.Ed.2d 395 (1991); see also Washington v. Schriver, 255 F.3d 45, 55 (2d Cir.2001) (discussing pre-AEDPA standards). Thus, in many cases it will be necessary to determine whether the state court has adjudicated a claim on the merits to determine the standard of review. Because the Appellate Division did not explain its basis for affirming the trial court on the Batson claims, we cannot conclude that it adjudicated those claims on the merits. Just as the Appellate Division decision does not reveal which of the four claims were not reached for procedural reasons, it does not reveal which claims were adjudicated on the merits. Therefore, we cannot hold any one of the four claims to have been adjudicated on the merits. See Miranda, 322 F.3d at 179 (2d Cir.2003) (holding that a "catch-all sentence stating that [petitioner's] `remaining contentions are unpreserved for appellate review, without merit, or do not require reversal'" does not justify AEDPA deference). In Miranda, we distinguished an earlier decision in which we held that disjunctive language similar to that used by the Second Department established a merits-based determination on the basis that, in the earlier case, neither party claimed that there had been a procedural default and the record demonstrated that appellant preserved his challenge. Id. at 178 (discussing Ryan v. Miller, 303 F.3d 231, 246 (2d Cir.2002)).7 In this case, neither the appellate decision nor the record makes it clear that the Appellate Division adjudicated Batson claims on the merits. Indeed, the citations suggest that the appellate court disposed of at least some of the claims for procedural reasons. Thus, pursuant to Miranda, we cannot find an adjudication on the merits at the Appellate Division level. 40 Despite the lack of clarity in the Appellate Division opinion, the reconstruction hearing record demonstrates that Justice Pincus adjudicated the Batson claims on the merits. It is not clear whether an adjudication on the merits by a trial court, which is neither explicitly affirmed on the merits nor explicitly rejected by the appellate court, is sufficient to trigger AEDPA review. Cf. Cotto v. Herbert, 331 F.3d 217, 230-31 (2d Cir.2003) (addressing a similar issue — in a different procedural context — without deciding it). Like the Cotto court, we need not resolve this issue on the facts of this case. As we explain below, the trial court's rejection of the Batson claim concerning Smith, Archibald, and Buckner was entirely fact-based. Because the judge's credibility findings are entitled to great deference even without applying AEDPA, the distinction between AEDPA and pre-AEDPA standards is not crucial for these three claims. For slightly more complicated reasons, the applicability or not of the AEDPA standard would not alter the outcome on the Hanson claim. With regard to Hanson, the state trial court relied on its credibility findings concerning the earlier challenges to determine that no pattern had been established. To the extent that our review implicates these earlier credibility findings, we review deferentially even without AEDPA. To the extent that we must determine whether the trial judge permissibly found no pattern or prima facie case with respect to Hanson, we will review de novo if there was no adjudication on the merits. See Oppel, 851 F.2d at 37. Because — even applying pre-AEDPA review — we find that the district did not err in its application of Batson, we do not reach the Cotto issue. 41 IV. Review of the state court adjudication. 42 As he explained at the reconstruction hearing, Justice Pincus believed Kern's explanations for challenging Archibald, Smith, and Buckner and found those challenges to be race neutral. The district court explicitly credited Justice Pincus's testimony. DeBerry III, 277 F.Supp.2d at 159-62. We must credit it as well unless the district court committed clear error. See Jenkins, 294 F.3d at 290. DeBerry identifies no basis on which we could find that the district court clearly erred, and the record in no way undermines Justice Pincus's testimony or the district court's finding. Therefore, we accept the district court's assessment. 43 Holding that Justice Pincus made credibility findings does not end our inquiry, we must still determine whether those findings should be set aside. In Hernandez, the Supreme Court explained: 44 Deference to trial court findings on the issue of discriminatory intent makes particular sense ... because, as we noted in Batson, the finding "largely will turn on evaluation of credibility." In the typical peremptory challenge inquiry, the decisive question will be whether counsel's race-neutral explanation for a peremptory challenge should be believed. There will seldom be much evidence bearing on that issue, and the best evidence often will be the demeanor of the attorney who exercises the challenge. As with the state of mind of a juror, evaluation of the prosecutor's state of mind based on demeanor and credibility lies "peculiarly within a trial judge's province." 45 500 U.S. at 365, 111 S.Ct. 1859 (internal citations omitted). In the context of a direct appeal from the New York Court of Appeals, the Hernandez Court applied a clear error standard of review to the trial court's credibility findings. Id. at 369, 111 S.Ct. 1859. We see no reason to apply a more stringent standard to a state court's credibility findings on habeas review. 46 Just as we found no clear error in the district court's appraisal of Justice Pincus's credibility, we find none in the justice's assessment of Kern's credibility. This holding does not imply that the judge could not have reached a contrary decision.8 A finding rejecting the prosecutor's explanations would have been supported by the record, including the prosecutor's acknowledgment that he kept other young jurors although he challenged Archibald because of his youth, Smith's law enforcement status, and the prosecutor's inarticulate explanation of his challenge to Buckner.9 DeBerry III, 277 F.Supp.2d at 152-54. Nevertheless, all of the prosecutor's explanations were facially neutral, the victim was African-American, id. at 154, it appears that some African-American jurors served on the jury, id. at 153, and Justice Pincus was in a far better position than we to evaluate Kern's demeanor and credibility, especially in light of his long history with Kern, id. at 163 n. 10.10 Similar facts caused the Hernandez Court to find no clear error in the trial court's credibility findings. See Hernandez, 500 U.S. at 369-70, 111 S.Ct. 1859 holding no clear error occurred despite the prosecutor's challenges to three and perhaps more Hispanic jurors because, among other things, the trial court could judge the prosecutor's demeanor, and the victim as well as the prosecutor's witnesses were Hispanic. Likewise, we find no clear error in Justice Pincus's credibility findings. 47 Justice Pincus found that no pattern had been established prior to the Hanson challenge because he credited all of the prosecutor's explanations as truthful and race neutral. As we have already explained, we must uphold the prior credibility findings. Moreover, we find no error in the judge's legal conclusion that defendants had not made out a prima facie Batson claim. After the judge's ruling that no pattern existed, Sheinberg argued that there was a pattern because the prosecutor had challenged the only African-American juror "[o]n this selection." Defense counsel bears the burden of articulating the basis, both factual and legal, for a Batson challenge. Overton v. Newton, 295 F.3d 270, 279 (2d Cir.2002). Here, defense counsel tacitly conceded that the prosecutor's prior challenges were no longer relevant to the prima facie showing. Hence, the trial court did not err by limiting its consideration to the challenges in the current round. Nor can we say that it erred by rejecting the argument that a prima facie claim was established by showing that one African-American juror was excused. CONCLUSION 48 For the reasons we have discussed, we affirm the judgment of the district court. Notes: 1 Judge Sand, a judge of the United States District Court for the Southern District of New York, sat by designation in the Eastern District 2 Neither Kern nor defense counsel identified the number of African-American jurors who remained on the jury. Therefore, the only record we have is the court's assertion that there were some African-American jurors 3 The transcript reads: "I find that inappropriate challenge." Justice Pincus clarified at the reconstruction hearing that he found the challenge to be appropriate, not inappropriate. The lack of grammatical felicity in the quoted language as well as the context of the statement, which included Justice Pincus's recollection that Archibald said that his youth would enable him to relate to the defendants, support the judge's claim that "inappropriate" was a typographical error 4 Justice Pincus also testified that he believed Mr. Angrotta, a juror whom the prosecutor did not challenge, was "a person of some color." 5 Alternatively, respondent contends that we must overruleFama as it conflicts with Coleman. We see no conflict, and, in any event, we lack authority to set aside a prior holding of this court absent an intervening opinion from the Supreme Court or this court, acting en banc, that explicitly or implicitly overrules the prior holding. Meacham v. Knolls Atomic Power Lab., 381 F.3d 56, 70 (2d Cir.2004). 6 Our inability to determine which of these three claims the Appellate Division determined on the merits and which it found not to have been preserved for appellate review also creates difficulty in determining whether the claims were "adjudicated on the merits" within the meaning of AEDPA, an issue that we discuss below at [16-17]See 28 U.S.C. § 2254(d). 7 InRyan, we also said: "[t]here is no reason ... to doubt that AEDPA applies [to disjunctive affirmances] because the only alternative to finding the claim adjudicated on the merits would be finding the claim procedurally barred, in which case we would not have entertained the claim in the first instance (absent a showing of cause and prejudice)." 303 F.3d at 246. In isolation, this statement might suggest a broad basis for holding disjunctive affirmances to be adjudications on the merits. Miranda, however, properly interpreted Ryan in light of its particular facts. Miranda, 322 F.3d at 178. Unlike the concurrence, we believe Miranda is fully consistent with Fama as well as with Sellan v. Kuhlman, 261 F.3d 303 (2d Cir.2001), in which we set out a procedure for determining whether an adjudication is on the merits. Fama and Miranda are consistent because under Fama, we look to whether a state court has clearly expressed its reliance on a procedural ground, while, for the AEDPA adjudication-on-the-merits analysis, we look to whether a state court actually adjudicated the claim on the merits. It is self-evident, we believe, that a state court can fail to clearly express its reliance on a procedural basis while, at the same time, not adjudicating the claim on the merits. Miranda is also consistent with Sellan in which we set out a test for determining whether a claim was adjudicated on the merits that envisioned looking beyond the face of the state court decision to determine whether, among other things, the state court was aware of a procedural bar. 261 F.3d at 314. 8 Nor do we adopt Justice Pincus's understanding ofBatson, which at times confused "pattern" with "prima facie case" and with discriminatory intent. See DeBerry III, 277 F.Supp.2d at 158-59. Our task is not to determine how well the trial court could articulate its understanding of legal principles but rather whether it applied the principles correctly and avoided clear error in its findings of fact. Because Justice Pincus correctly applied Batson by assessing the credibility of the prosecutor's explanations and his credibility findings are not clearly erroneous, he committed no error sufficient to justify granting the writ. 9 It also appears that Kern had, in an earlier round of jury selection, challenged other African-American jurors without complaint from defense counselDeBerry III, 277 F.Supp.2d at 152. However, because DeBerry was responsible for "articulating and developing the factual and legal grounds supporting his Batson challenge before the trial court," Overton v. Newton, 295 F.3d 270, 279 (2d Cir.2002), we attach little significance to the prior challenges, which Kern was given no opportunity to explain. 10 DeBerry contends that the district court was not entitled to weigh its prior experience with Kern in judging the credibility of his explanation. We disagree. Judging an attorney's credibility is reasonably influenced by the attorney's prior history with the court 49 JOHN M. WALKER, Jr., Chief Judge, concurring. 50 I concur in Judge Pooler's opinion affirming the district court's denial of DeBerry's petition for a writ of habeas corpus. I write separately to highlight a major inconsistency in our cases that discuss the standard of review for state court habeas decisions whose grounds are unclear. In what one experienced district court judge has referred to as a "congeries of holdings," e.g., Taus v. Senkowski, 293 F.Supp.2d 238, 245 (E.D.N.Y.2003) (Weinstein, J.), we have wrestled with the level of deference due when the state court adjudicating habeas claims states that the "remaining contentions are either unpreserved for appellate review or are without merit." In Fama v. Commissioner of Correctional Services, 235 F.3d 804, 810-11 (2d Cir.2000), we held that such language failed to establish that the claims raised were procedurally barred and that therefore they were amenable to federal habeas review. Fama, however, did not address the question of whether the heightened deference granted under 28 U.S.C. § 2254(d) to state court adjudications on the merits applied in such situations. See id. (reviewing and rejecting petitioner's claims on the merits without discussing § 2254(d)).11 In other words, Fama held that claims adjudicated on an "either unpreserved... or without merit" basis were presumed to be preserved. This holding carried with it the implicit suggestion that such claims were presumed to have been adjudicated on the merits. However, Fama was silent as to whether a state court decision that was presumed to be on the merits should be given the deference that AEDPA mandates for claims that are actually adjudicated on the merits. See 28 U.S.C. § 2254(d). 51 We discussed the interplay between "either/or" adjudications and AEDPA deference more directly in two subsequent decisions. In Ryan v. Miller, 303 F.3d 231, 245-46 (2d Cir.2002), we noted that under Fama, adjudications made on an "either/or" basis were presumed to be preserved. We noted, furthermore, that in the particular context of Ryan's petition, neither party disputed that his claims were preserved and nothing in the state court decision indicated "that the claims were decided on anything but substantive grounds." Id. at 246 (internal quotation marks and citation omitted). Accordingly, we treated the state court adjudication as one "on [the] merits" and, pursuant to § 2254(d), applied AEDPA deference. Id. 52 In Miranda v. Bennett, 322 F.3d 171 (2d Cir.2003), however, we took a different view of the matter. There the state court had held that the "remaining contentions are unpreserved for appellate review, without merit, or do not require reversal." Id. at 179.12 Under Fama, we should presumably have treated the claim as not procedurally barred and thus as decided on its merits. But instead, upon reviewing the Appellate Division's opinion and the State's Memorandum to the district court, we concluded that "the record does not make it clear that either claim was rejected for lack of merit." Id. In other words, while the state court's language indicated that the grounds of decision were either A or B, and while Fama required that we presume that the grounds of decision were not A, in Miranda we were unwilling to presume that the grounds of decision were in fact B (on the merits). We therefore declined to apply AEDPA deference. Id. 53 As a matter of logic, Miranda's holding makes little sense. The state court says its decision is based on either A (claim unpreserved) or B (fails on the merits). Fama creates a presumption that where the record provides no further indication of whether it was A or B, then the habeas court should presume it is not A (the claim is not unpreserved). Logic compels the conclusion that the state court must have decided the claim on the basis of B (the claim fails on the merits). But this is precisely the conclusion that Miranda rejects. In short, the purpose of the Fama presumption is to allow courts to assume B; Miranda undermines that purpose by holding that courts cannot assume B either.13 In other words, according to Miranda, a state court's conclusion of A or B equals neither A nor B. 54 But Miranda is not just logically inconsistent with Fama; it is also substantively at odds with Fama's approach to habeas review. Fama and Ryan recognized a choice in the "either/or" situation: either treat the claim as unpreserved or as preserved and on the merits. In refusing to treat such claims as unpreserved and thus procedurally defaulted, Fama and Ryan allowed petitioners to avoid the near insurmountable obstacles to federal review that face procedurally defaulted claims. See Coleman v. Thompson, 501 U.S. 722, 730, 750, 111 S.Ct. 2546, 2554, 2564-65, 115 L.Ed.2d 640 (1991) (federal habeas review not available for procedurally defaulted claims unless petitioners shows (1) cause and prejudice, or (2) fundamental miscarriage of justice). In no sense did these two decisions suggest that the alternative was to bypass AEDPA deference altogether in favor of pre-AEDPA review. Indeed, Ryan explicitly held that where the state court employs "either/or" language, "[t]here is no reason to doubt that AEDPA applies ... because the only alternative to finding the claim adjudicated on the merits would be finding the claim procedurally barred, in which case we would not have entertained [it] (absent a showing of cause and prejudice)." Ryan, 303 F.3d at 246. In light of that holding, and in light of the principles of comity and federalism that underlie habeas jurisprudence, see Coleman, 501 U.S. at 730-32, 750-51, 111 S.Ct. 2546, I find Miranda's adoption of a pre-AEDPA, non-deferential standard of review to be unwarranted. 55 Doubtless cases arise in which habeas claims may be reviewed without AEDPA deference, for example, either because the claim has not been decided on the merits and the state court's ground for dismissal is not sufficiently "independent" and "adequate," see, e.g., James v. Kentucky, 466 U.S. 341, 348-49, 104 S.Ct. 1830, 1835, 80 L.Ed.2d 346 (1984) (procedural rule not firmly established or regularly followed was not independent and adequate ground); NAACP v. Alabama ex rel. Patterson, 357 U.S. 449, 457-58, 78 S.Ct. 1163, 1169-70, 2 L.Ed.2d 1488 (1958) (novel state procedural bar not independent and adequate ground), or because a properly preserved claim, recognized as such, was misconstrued by the state court and hence not decided "on the merits," see, e.g., Chadwick v. Janecka, 312 F.3d 597 (3d Cir.2002) (no adjudication on merits under § 2254(d) where state court misunderstood nature of properly preserved federal claim); Appel v. Horn, 250 F.3d 203, 209-12 (3d Cir.2001) (same). But these situations are not presented here. 56 I therefore believe that Miranda was wrongly decided and should not be the law of this circuit. However, because the result in this case is the same whether or not AEDPA deference is accorded to the state court decision, I concur in the result reached by the majority. Notes: 11 Because § 2254(d) is a provision of the Antiterrorism and Effective Death Penalty Act of 1996, Pub.L. No. 104-132, 110 Stat. 1214 ("AEDPA"), we commonly refer to the standard mandated therein as "AEDPA deference." 12 This formulation ostensibly poses three alternatives: "[Petitioner's] remaining contentions are unpreserved for appellate review, without merit,or do not require reversal." People v. Miranda, 243 A.D.2d 584, 585, 665 N.Y.S.2d 507, 508 (1997) (emphasis added). But the third option suggests a decision on the merits; it implies that petitioner's claims may have had merit, but nevertheless failed to raise issues significant enough to require reversal. For the purposes of this discussion, this third option is treated as merged with the "without merit" category. 13 The seeming incongruence ofFama and Miranda has not gone unnoticed. In Shih Wei Su v. Filion, 335 F.3d 119, 125 (2d Cir.2003), we found it unnecessary to resolve the tension between the two cases, since the state conceded that there had been an adjudication on the merits, thus allowing us to apply AEDPA deference without dispute. The Shih Wei Su court, however, did reflect on Fama, Ryan, and Miranda, and noted that "our cases seem to contemplate situations in which, because of uncertainty as to what the state courts have held, no procedural bar exists and yet no AEDPA deference is required." Id. at 126 n. 3.	{ "pile_set_name": "FreeLaw" }
gave conflicting stories about the reason he was out. A search of the area where Mikolajczyk originally spotted appellant revealed a screwdriver set with one bit removed. The bit, along with the driver, was on the curb. When Mikolajczyk asked appellant what he was doing with the tools, appellant shrugged his head, lowered it, and said, "I don't know," but did not deny possession of the set. From this evidence, a rational trier of fact could reasonably infer that appellant committed the charged offense. See NRS 205.080; Palmer v. State, 112 Nev. 763, 768-69, 920 P.2d 112, 115 (1996) (discussing actual and constructive possession); Glispey v. Sheriff, 89 Nev. 221, 223-24, 510 P.2d 623, 624 (1973); cf. Buchanan v. State, 119 Nev. 201, 217, 69 P.3d 694, 705 (2003) (circumstantial evidence alone may sustain a conviction). Accordingly, we ORDER the judgment of the juvenile court AFFIRMED. Gibbons Dou Saitta cc: Hon. William 0. Voy, District Judge, Family Court Division Clark County Public Defender Attorney General/Carson City Clark County District Attorney/Juvenile Division Eighth District Court Clerk SUPREME COURT OF NEVADA (0) 1947A 2 4;1 .;14.4;`1 - 1- s ,•"	{ "pile_set_name": "FreeLaw" }
177 Cal.App.2d 253 (1960) YUCCA WATER COMPANY, LTD. (a Corporation), Appellant, v. AL ANDERSON, Respondent. Civ. No. 6203. California Court of Appeals. Fourth Dist. Jan. 20, 1960. John E. Sisson and Guy T. Graves for Appellant. Gibson, Dunn & Crutcher and Richard L. Wells for Respondent. MONROE, J. pro tem. [fn. ] The plaintiff and appellant brought this action for the specific performance of a contract between the parties dated January 12, 1949, relative to the furnishing of water for domestic purposes for use upon property which defendant and respondent intended to subdivide and sell. Plaintiff also sought damages for alleged breach of the contract. The issues were determined in favor of the defendant and judgment was rendered in his favor and from that judgment the plaintiff appeals. Appellant assigns rulings of the trial court admitting evidence concerning the transactions which culminated in the execution of the contract as error, for the reason that it is claimed the contract is clear and unambiguous; that it is unambiguous as a matter of law; and that all prior negotiations are merged therein. The contract provides in part as follows: "Whereas, Anderson is interested in certain real property consisting of the following:" Tract or tracts of land in Section 1, Township 1 South, Range 5 East, San Bernardino Base and Meridian. Said property being adjoining and contiguous to property now being supplied with water, as aforesaid, by Water Company, and "Whereas, Anderson desires to obtain for such real property, water from the Water Company, and Water Company has agreed to furnish water for such real property under the following terms, covenants and conditions, and none otherwise; 255" "Now, Therefore, It Is Agreed As Follows:" "1. Water Company agrees to furnish water, for domestic purposes only, to all consumers within the above described real property, as aforesaid, and none other." "2. Anderson shall, at his own cost and expense, install and construct all water lines within the land to be served, as aforesaid, and shall install a reservoir of acceptable size and specifications to the Water Company." "3. Anderson shall, at his sole cost and expense, connect with present water system from a Main Transmission Line, running parallel with, and approximately 35 feet South of the Northerly section line of said Section 1. Said Main Transmission Line is to be installed by Fred A. Storey at an agreed price with Anderson and same to be paid for by Anderson. Said pipeline is to be approximately 3965 feet, extending from the Westerly line of Section 1 Easterly to a point approximately 5 feet inside the East 1/2 of the East 1/2 of Section 1." "4. Anderson shall pay for all pipe, fittings, connections, work and material going into the erection and construction of said water system within said land, including connecting his said water system with the water system to be installed as mentioned immediately above. * * " "7. It is specifically agreed by Anderson that when he shall have installed and constructed his water system within the tract or tracts of land described herein, and shall have completed his connections with the water system of Water Company, he shall, for the sum of $1.00, immediately transfer said water system clear and free of encumbrance of every nature, description or kind, to Water Company by proper instrument in writing, and shall provide for Water Company in perpetuity rights of way necessary and sufficient to maintain, repair, construct or reconstruct said water lines, and the whole thereof, within the said land designated as aforesaid. ..." The substance of plaintiff's claim was that it had carried out its obligations under the contract and that therefore the defendant was obligated to transfer to it, by sufficient written instrument, title to water distribution works that had been constructed upon the property in Section 1; that the works thus constructed were insufficient and that plaintiff should recover as damages sufficient money to pay the cost of making the works sufficient. It was further claimed that defendant 256 had in 1956 breached said contract by refusing to accept delivery of water from it and that plaintiff was thereby entitled to damage. [1] An examination of the written contract reveals that it fails to describe or identify the "tract or tracts" to which reference is made. When it is noted that the defendant agrees to install a water system and to thereupon transfer title thereto to the plaintiff, it is obvious that the sufficiency of the water system to be thus constructed could not possibly be determined without a determination of the identity of the land intended to be covered. "A contract to be binding must be definite and certain. (Goehring v. Stockton Morris Plan Co., 93 Cal.App.2d 417, 420-421 [209 P.2d 41].) A contract will not be enforced unless it is complete and certain. (Blake v. Mosher, 11 Cal.App.2d 532, 535-536 [54 P.2d 492].) Where a party seeks specific performance of a contract the terms of the contract must be certain and definite in all particulars essential to its enforcement. A court must be able to say what is the stipulated performance. (Moore v. White, 98 Cal.App.2d 510, 513 [220 P.2d 918].)" (Colorado Corp., Ltd. v. Smith, 121 Cal.App.2d 374, 376 [263 P.2d 79].) See 45 Cal.Jur.2d 269, 15. It is a well-established rule of law, reflected by Civil Code, section 3538, that "That is certain which can be made certain." "The general rule seems to be that if the writings comprising the contract in themselves disclose the key or means by which the description may be made certain or identified with its location on the ground, extrinsic evidence may be introduced." (45 Cal.Jur.2d 279, 21.) It is held that a well- established custom may be relied upon to render sufficiently certain to justify specific performance a contract which is otherwise uncertain in some of its details. (King v. Stanley, 32 Cal.2d 584 [197 P.2d 321].) It is apparent therefore that no decree of specific performance of this contract could possibly have been entered without proof of sufficient facts to render the contract sufficiently certain for the purposes of such decree. It was the ruling of the trial court that the contract was ambiguous and therefore evidence of the transaction between the parties was received. The defendant Anderson testified in detail and his evidence finds support in the testimony of other witnesses. In substance he stated the facts to be as follows: 257 In 1945 he and nine other individuals formed a partnership and acquired lands in Section 3, Section 1 and other property, for the purpose of subdividing and selling lots to the public. They obtained a supply of water on Section 3 and installed a water distribution system and sold lots in that section. In 1946, the water distribution system as it then existed was transferred and, by a subsequent transfer in 1947, became the property of the plaintiff corporation. The plaintiff filed its rules and regulations and tariff schedules with the Railroad Commission. In 1948 an agreement was executed whereby the plaintiff company undertook to furnish water upon land in Section 1 and other property. Thereafter, the copartnership was dissolved and its property holdings were divided among the partners, with the result that Mr. Anderson, the defendant, became the owner of the west half of the east half of Section 1 comprising 166 acres which he subsequently subdivided as "Tract 3426." One of the partners was Mr. Vogel, who obtained 170 acres in Section 1. In the latter part of 1948, Mr. Vogel and the defendant Anderson had a conversation with Mr. Storey on behalf of the plaintiff company relative to a commitment for water supply upon the property owned by them. The purpose of this conversation appears to have been to secure assurance that a water supply would be available in connection with proposed subdivisions. It was testified by defendant that as a part of this transaction Mr. Storey agreed on behalf of the company that for the purpose of supplying water to property in Section 1, the company would install a 4-inch water line across Section 2 to convey water from their water system in Section 3. Although this statement was denied, the court found that such commitment was made. Thereafter, the plaintiff, through its officers, caused the agreement now in controversy to be drawn and submitted to the defendant for execution. It was accordingly signed by him. The main conflict in the testimony arose with reference to the property discussed or identified as the subject matter of the transaction. Mr. Anderson testified positively and repeatedly that when the negotiations for a commitment were opened he owned only the 166 acres and that he at no time discussed any binding contract such as here involved with reference to any other property. He testified positively that he at all times understood and believed that the contract referred only to Tract 3426 and not to any 258 other property. Testimony on behalf of the plaintiff was to the effect that the contract contemplated any property that Mr. Anderson might at any time acquire in Section 1. It is the fact that defendant did acquire other tracts in Section 1. The court found that the parties never came to a meeting of the minds as to the territory actually intended to be covered by the contract. The court found that the defendant at all times understood the contract as being one which referred only to the 166 acres of Tract 3426, while plaintiff and its officers at all times understood that the contract referred to any property which Mr. Anderson might acquire. Succeeding transactions became important for the purpose of determining whether the parties had, by their acts or subsequent agreement, determined the meaning of the contract or had resolved its ambiguities. It appears that Mr. Anderson installed a water system for delivery of water to lots in Tract 3426 and sold lots in that tract to the public. The system thus installed did not at the time include a reservoir. It was however connected to a pipe- line installed by plaintiff and water deliveries were made to occupants of lots. Water deliveries started in June of 1949. The defendant did tender to plaintiff a bill of sale purporting to transfer to plaintiff the water distribution system thus installed, but this offer was rejected upon the ground that the system was insufficient to meet the requirements of the contract, because no reservoir had been erected. Thereafter, defendant acquired other tracts in Section 1, installed water distribution systems to serve them, erected a 10,000-gallon reservoir, and connected such distribution systems to the original system so that plaintiff was supplying water to the occupants of lots in all of such tracts. This appears to have been done without any objection or discussion. There was, however, considerable discussion as to what defendant should erect by way of storage reservoirs. Such arguments appear to have been inevitable, due to the fact that defendant, as found by the trial court, regarded himself bound under the contract only as to the 166 acres in Tract 3426. There was testimony offered by defendant to the effect that the distribution system which he installed for that tract was sufficient for that purpose and it was so found by the trial court. The trial court further found in accordance with the testimony of the defendant that he at all times believed that, under the original agreement of 1948, the company 259 had undertaken to furnish water to any tract in Section 1 and that he was entitled to receive water under that contract without any obligation to transfer title to a distribution system as in the 1949 agreement. The ultimate result was the commencement of this litigation. Also, the defendant commenced a proceeding in 1954 before the Public Utilities Commission for the purpose of securing a certificate of public convenience and necessity to supply water in Section 1 and other properties. This was done because in the meantime he had obtained a water supply in Section 36, to the north of Section 1. The appellant also applied for such certificate of authority to supply water to all of Section 1. A lengthy hearing was had which resulted in the issuance of a certificate to the defendant upon condition that certain requirements be met with respect to the erection of reservoirs to insure proper supply of water to landowners in Section 1. Apparently these requirements were met and thereupon defendant's water supply was connected with his reservoir and distribution system and the water service of the plaintiff and appellant was cut off. The court found, upon conflicting testimony, that during all of these subsequent transactions the defendant acted in good faith and that he at all times believed that the contract in question applied to the original 166 acres only. The trial court also found, upon conflicting evidence, that one of the considerations for the contract was the promise of plaintiff that it would install a 4-inch line; that that promise was not fulfilled and that as a result water shortages were occasioned. The materiality of this finding is questioned. [2] Although conceding that there was a conflict in the testimony, the appellant claims that the testimony of the defendant was inherently improbable. It is true that there appears a rather unusual situation, due to the fact that the parties permitted the matter to go for several years without arriving at some definite agreement defining their contractual rights and obligations. There is nothing inherently improbable in this situation, however, and therefore the court may not disregard the findings of the trial court supported by substantial evidence. (People v. Carvalho, 112 Cal.App.2d 482 [246 P.2d 950].) [3] The court having found that there never was a meeting of the minds as to the terms of the contract, and it appearing that the contract is uncertain and ambiguous 260 and that that uncertainty was never satisfactorily removed and that the parties did not by any subsequent agreement or conduct define their obligations so as to render the contract certain, it follows that no specific performance could be granted. A number of other rulings are assigned as error but it appearing that the contract was not specifically enforceable, plaintiff could not recover in any event and a determination of the other issues would serve no useful purpose. [4] The plaintiff also sought damages in lieu of specific performance, but it is the rule that in such case when specific performance may not be allowed because there is no enforceable contract, claim for damages in lieu thereof likewise fails. (Eagle Oil & Refining Co. v. James, 52 Cal.App.2d 669, 678 [126 P.2d 880], 45 Cal.Jur.2d 377, 85.) Judgment affirmed. Griffin, P. J., and Shepard, J., concurred. NOTES [fn. ] . Assigned by Chairman of Judicial Council.	{ "pile_set_name": "FreeLaw" }
786 A.2d 191 (2001) COMMONWEALTH of Pennsylvania, Appellee v. Ricky Lynn McCALL, Appellant. Supreme Court of Pennsylvania. Submitted October 16, 2000. Decided December 19, 2001. 192 Andrea Konow, Collegeville, for appellant, Ricky Lynn McCall. David A. Hepting, Timothy F. McCune, Butler, for appellee, Com. of Pa. Before FLAHERTY, C.J., and ZAPPALA, CAPPY, CASTILLE, NIGRO, NEWMAN and SAYLOR, JJ. Justice NEWMAN. We granted appeal in this matter to determine whether former counsel for Ricky Lynn McCall (Appellant) was ineffective for failing to brief and argue on direct appeal Appellant's subsequent acquittal of a prior crime that was used as evidence of motive and intent during trial of the instant matter, thus entitling him to relief pursuant to the Post-Conviction Relief Act, 42 Pa.C.S. §§ 95419546. Facts and Procedural History In February of 1992, Appellant was residing in Butler County in a home owned by Francis Blystone (Blystone), and Blystone's child. Her boyfriend, Gary Risinger, also lived in the house. The house was insured for $30,000.00, which was more than the purchase price. Blystone was having serious financial difficulties and the utility company had shut off the natural gas service to the residence. The house was heated by a coal and wood-burning stove. On February 7, 1992, fire destroyed the Blystone house, three days after a teacher indicated to Blystone that she would report to the county children's agency that the house was unsuitable for children. The Pennsylvania State Police Fire Marshall's Office investigated the fire and determined that it was arson. Appellant, Blystone, and Risinger were interviewed as part of the investigation. Each claimed that the fire was accidental. A polygraph examination was scheduled for all three individuals regarding their knowledge of the crime. Following the fire, they moved into another house in Butler County, where Blystone's grandmother, Mary Boofer (Boofer), was living. On the night of March 7, 1992, Blystone and Risinger were staying in the upstairs bedroom. Blystone's cousin, Judith Ealy (Ealy) and her boyfriend, David Pisor were also sleeping on the second floor. Boofer and her boyfriend, James Shever, were in a downstairs bedroom. Appellant was staying in the living room, where it was his job to tend the fireplace, which was the only source of heat in the entire house. At approximately 4:00 a.m., a fire destroyed the home, resulting in the death of Blystone and Ealy. The survivors, who were either naked or partially dressed when they escaped the fire, noticed that Appellant was fully dressed and was wearing his lace-up boots. Risinger and Shever testified that Appellant usually removed his shirt and shoes when sleeping on the living room couch. Michelle Goodman, who was Boofer's granddaughter, lived next door to the house where the fire took place. She awoke at approximately 4:00 a.m. when she heard her dogs barking. She looked outside the window, and saw that the porch of the house next door was on fire. After asking her boyfriend to call 9-1-1 to report the fire, she saw Appellant walk across the yard at a normal pace. He knocked on her door and told her that everyone was out of the house. According to Appellant, he cleaned out the fireplace at 7:30 p.m. the evening of the fire and he placed the ashes in a bucket that he set on the porch to cool. At 2:30 a.m., he transferred the ashes to a paper bag, and placed the bag of ashes on the couch on 193 the porch. He claimed that he saved the ashes because his mother wanted to use them for kitty litter. Appellant went to sleep at 3:30 a.m. and was awakened by the fire at 4:00 a.m. The Pennsylvania State Police Fire Marshall, assisted by the Allegheny County Fire Marshall, investigated the scene and determined that the cause of the fire was arson. They discovered evidence of liquid burn patterns on the front porch and unusual damage that could only be caused by use of a liquid accelerant. Areas of the living room tested positive for hydrocarbons, indicating that a petroleum based product had been used to accelerate the fire. According to the Allegheny County Fire Marshall, even if the fire had been started by the ashes on the couch, as Appellant claimed, it would have taken three to four hours of smoldering before the couch burst into flames. The Commonwealth's theory of the case was that Appellant started both fires and that he started the second fire in order to kill Blystone who, had she lived, would have implicated him in the first fire if she failed the lie detector test as she said she would. The Commonwealth charged Appellant for both fires. After the Court of Common Pleas of Butler County (trial court) denied the Commonwealth's motion to consolidate the two cases, the Commonwealth decided to prosecute the second fire first. A jury convicted Appellant of two counts of second-degree murder[1] and one count each of arson[2], recklessly endangering another person[3], failure to prevent a catastrophe[4] and intimidation of a witness.[5] The trial court sentenced him to serve two consecutive terms of life imprisonment for the murder convictions, sixty-six to one hundred thirty-two month's imprisonment for the arson conviction, and eight to sixteen months for the intimidation of witnesses' conviction. No further penalty was imposed on the remaining convictions. Following a subsequent trial for the first fire, Appellant was acquitted. He then appealed his conviction for offenses involving the second fire. On direct appeal, he argued that the trial court erred by admitting evidence of a separate arson charge because it allowed the Commonwealth to assert that he was an arsonist without establishing it beyond a reasonable doubt. He also claimed that the trial court improperly admitted evidence of the other arson because he was not convicted of that crime. The Superior Court affirmed the decision of the trial court. Appellant filed a petition for allowance of appeal, which this Court denied. Appellant filed a pro se petition pursuant to the Post Conviction Relief Act, 42 Pa.C.S. §§ 9541-9546. Court-appointed counsel later amended the petition. The PCRA court denied relief, and the Superior Court affirmed the decision. Discussion This Court granted allocatur limited to the question of whether counsel on direct appeal rendered ineffective assistance by failing to brief and argue Appellant's subsequent acquittal of a prior crime used against him as evidence of motive and intent in the trial regarding the second fire. 194 The Commonwealth argues that because this issue has been finally litigated, it may not be raised in a PCRA petition. Section 9543 of the PCRA provides, in relevant part: § 9543. Eligibility for relief. (a) General ruleTo be eligible for relief under this subchapter, the petitioner must plead and prove by a preponderance of the evidence all of the following: ... (3) That the allegation of error has not been previously litigated or waived. Section 9544 provides in relevant part: § 9544. Previous litigation and waiver (a) Previous litigation.For purposes of this subchapter, an issue has been previously litigated if: ... (2) the highest appellate court in which the petitioner could have had review as a matter of right has ruled on the merits of the issue. It is well settled that one cannot avoid the restrictions on raising a previously litigated issue by claiming that counsel was ineffective in his or her method of advocating the issue. See Commonwealth v. Travaglia, 541 Pa. 108, 661 A.2d 352, 358 (1995). In his direct appeal, Appellant challenged the decision of the trial court to allow evidence of his involvement in the first arson as proof of his motive for committing the second arson. In the following passage, the Superior Court addressed Appellant's argument on direct appeal: Appellant initially argues the trial court erred in denying his repeated requests that the Commonwealth be directed not to make any reference to a separate arson charge which was then pending against appellant or matters which related thereto. .... Appellant contends the separate arson charge pending against him was inadmissible because he had successfully severed the two trials by means of an omnibus pretrial motion. Furthermore, by using the preceding arson charge in the subsequent arson trial, appellant alleges the Commonwealth was able to assert appellant was an arsonist without proving each and every element beyond a reasonable doubt. The omnibus hearing only served to deny consolidation of the cases, however, the court made no evidentiary ruling nor did appellant, in his motion, ask for a ruling on the evidence. Later, at trial, appellant presented a motion in limine to the trial judge, who properly ruled on the admissibility of the evidence. This Court will not reverse the trial court's determination regarding the admissibility of evidence of prior crimes absent an abuse of discretion. Commonwealth v. Camperson, 417 Pa.Super. 280, 612 A.2d 482 (1992). As a general rule, evidence of a separate crime is inadmissible. Commonwealth v. Hall, 523 Pa. 75, 565 A.2d 144 (1989). However, evidence showing prior criminality may be admitted if it is relevant for some other legitimate reason other than defendant's propensity for committing crimes or to show bad character. Commonwealth v. Tedford, 523 Pa. 305, 567 A.2d 610 (1989). Specifically, evidence of other crimes may be admitted to prove motive, intent, absence of mistake or accident, a common scheme, plan, or design embracing the commission of two or more crimes so related to each other that proof of one tends to prove the other or to establish the identity of the person charged with the commission of the crime on trial. Commonwealth v. 195 Newman, 564 [528] Pa. 1308 [393], 598 A.2d 275 (1991). Here, evidence of the first fire was admissible to establish appellant's motive for setting the second fire as well as being the basis for the witness intimidation charge. Moreover, the evidence was relevant as both fires were started by use of a liquid accelerant. Appellant further contends the prior arson charge should not have been admitted because he was not convicted of the crime. However, actual convictions are not necessary for evidence of prior crimes to be held admissible. See Commonwealth v. Marsh, 388 Pa.Super. 610, 622, 566 A.2d 296 (1989). This rule holds true even if the prior charges are dropped. Id. Accordingly, we find the trial court did not abuse its discretion in admitting the evidence of the prior arson charges. Superior Court Memorandum Opinion, 00803 Pittsburgh 1993, pp. 2-4. Appellant's present claim is that counsel was ineffective for not arguing on appeal Appellant's subsequent acquittal on the first arson charge[6] as grounds for overturning the trial court's decision to permit evidence of this arson as proof of Appellant's motive for the second arson. The ultimate question with respect to Appellant's present claim and his issue on direct appeal is the same: was the admission of evidence of Appellant's involvement in the first arson proper? Appellant's acquittal of the first arson charge after his conviction for the second arson where the trial court allowed the Commonwealth to introduce evidence of his participation in the first arson to prove his motive for committing the second arson does not per se invalidate the decision of the trial court. Indeed, neither the Double Jeopardy nor the Due Process Clauses of the United States Constitution prohibit the introduction of otherwise admissible evidence of a defendant's prior crime, even where the 196 defendant has been acquitted of that crime. See Dowling v. United States, 493 U.S. 342, 110 S.Ct. 668, 107 L.Ed.2d 708 (1990).[7] An acquittal on the first arson charge supports Appellant's argument that the trial court improperly ruled that the probative value of this evidence outweighed its prejudicial impact, but it is not dispositive of this point. It is merely one more aspect of the issue already raised by Appellant on direct appeal, i.e., whether the trial court properly admitted the evidence of Appellant's involvement in the first arson. So long as counsel has raised the issue, we will not allow a PCRA petitioner to circumvent the bar against previously litigated issues by claiming ineffective assistance of counsel in his or her manner of arguing the issue. See, e.g., Commonwealth v. Williams, 557 Pa. 207, 732 A.2d 1167, 1183 (1999) ("a petitioner may not obtain relief on collateral review merely by alleging ineffective assistance of counsel and presenting claims that were previously litigated under new theories"). That is essentially what Appellant attempts in his present claim. Moreover, even assuming that the PCRA's bar against review of previously litigated issues does not apply, Appellant is not entitled to a new trial. At the time of Appellant's trial on the second arson and murder charges, the charges against him from the first arson were still open. The Commonwealth offered evidence of Appellant's involvement in the first arson to establish his motive for committing the second arson. It is well settled that evidence of a defendant's prior criminal activity may be introduced to establish his or her motive for the crime for which he or she presently stands accused. See Commonwealth v. Murphy, 540 Pa. 318, 657 A.2d 927 (1995). The focus of the trial court in ruling on the admissibility of evidence of Appellant's involvement in the first arson is whether the probative value of that evidence outweighs its prejudicial impact. See Commonwealth v. Morris, 493 Pa. 164, 425 A.2d 715 (1981). As demonstrated by Dowling, supra, Appellant's subsequent acquittal of the first arson does not automatically require reversal of the determination by the trial court that the probative value of this evidence outweighed its potential prejudice. The ruling of the trial court was correct when made, and the Appellant's subsequent acquittal of the first arson charges does not change the propriety of that ruling. Conclusion For these reasons, we affirm the Order of the Superior Court denying PCRA relief to Appellant. 197 Justice SAYLOR files a concurring opinion. Chief Justice FLAHERTY, and Justice NIGRO file dissenting opinions. Justice SAYLOR, concurring. I agree with the majority that, given the Superior Court's treatment on direct appeal of the issue sought to be raised in this PCRA proceeding, the question has been previously litigated and is therefore not presently available as a viable claim for post-conviction relief. However, to the extent that the majority's further expression concerning the merits of the underlying claim can be read to suggest that a subsequent acquittal may never be offered as a basis for supporting a claim that evidence of prior conduct should not have been admitted and/or that prejudice resulted from the erroneous admission of such evidence, I would respectfully disassociate myself from such suggestion. Notably, other jurisdictions are divided concerning whether, and under what circumstances, evidence may be admitted of another crime for which the defendant has been acquitted. See generally 2 McCORMICK, EVIDENCE § 190, at 671 & n. 64 (5th ed. 1999) (collecting cases); Annotation, Admissibility of Evidence as to Other Offense as Affected by Defendant's Acquittal of That Offense, 25 A.L.R.4th 934 (2000) (same). Given the competing views and the rather complex nature of the questions involved, and particularly in light of the overtones of an after-discovered evidence paradigm arising where the other-crime acquittal occurs subsequent to the conviction under review, I view these questions as best left for a case (or cases) in which their resolution is necessary to the disposition. Chief Justice FLAHERTY, dissenting. Where one is charged with crime A and crime B and due to bifurcation crime B is brought to trial prior to alleged crime A, but crime A becomes a significant part of the record in the trial of crime B resulting in a conviction, then the defendant is acquitted by a jury of crime A, does fundamental fairness require a new trial, when reviewed in an ineffectiveness context where counsel fails to brief and argue the point on appeal? On this record, at least, I would say it does. In the new trial the facts of crime A as they regard the defendant would not necessarily be precluded, but that a jury acquitted the defendant of crime A along with appropriate instructions delivered to the jury would be made known to and subject to argument before the jury as it was in Dowling v. United States, 493 U.S. 342, 110 S.Ct. 668, 107 L.Ed.2d 708 (1990). Justice NIGRO, dissenting.. Appellant was charged with arson and related offenses resulting from a fire on February 7, 1992. Appellant was later charged with two counts of criminal homicide, arson, and related offenses stemming from a second fire on March 7, 1992. The cases were severed for trial upon Appellant's motion, and the Commonwealth chose to prosecute the homicide/arson case first, which is the case before the Court here. At trial, the Commonwealth presented evidence of the alleged prior crime of arson to prove motive and intent in the instant case. On January 21, 1993, a jury convicted Appellant of two counts of second-degree murder and one count each of arson, intimidation of witnesses, recklessly endangering another person and failure to prevent a catastrophe. Subsequently, on March 23, 1993, a jury acquitted Appellant of all charges in the first arson case. In this appeal under the Post-Conviction Relief Act ("PCRA"), 42 Pa.C.S. §§ 9541-9546, Appellant claims that counsel on direct appeal was ineffective for failing to argue that the evidence of the first arson 198 was improperly used as motive and intent in the instant case because he was subsequently acquitted of that arson. The majority concludes that the Superior Court addressed Appellant's claim on direct appeal and therefore, his claim is barred under the PCRA as previously litigated. Based on my reading of the record, however, I cannot agree with this conclusion. Furthermore, I believe that Appellant is entitled to a new trial due to the ineffectiveness of counsel on direct appeal. Accordingly, I respectfully dissent. The majority first holds that Appellant's claim asserted here in his PCRA appeal has been previously litigated because it is substantially similar to the evidentiary claim he asserted on direct appeal. The crux of the evidentiary issue raised on direct appeal, however, was that the trial court erred in admitting evidence of a crime for which Appellant had been charged but not yet convicted, thereby allowing the Commonwealth to assert Appellant's guilt in the first arson case without having to prove that charge beyond a reasonable doubt. The crux of the issue here, on the other hand, is the effect of the subsequent acquittal rather than the admission of evidence of a crime for which the charges were still pending. The distinction between the two claims is, in my view, most clearly highlighted by the simple fact that Appellant had merely been charged with, and not yet acquitted of, the first arson at the time the trial court made its evidentiary ruling. Thus, it would have been impossible for Appellant to argue the effect of the acquittal at that point, when such an event had not yet occurred. Given these circumstances, I believe it is unfair to conclude, as the majority does, that the "ultimate question" in the two proceedings is the same. See Commonwealth v. Miller, 560 Pa. 500, 746 A.2d 592, 602 n. 9 (2000)("Because this claim does not rest solely upon the previously litigated evidence, we will reach the merits of appellant's claim"). Furthermore, I disagree with the majority's conclusion that Appellant's counsel on direct appeal raised the issue of Appellant's subsequent acquittal in the first arson case and that the Superior Court addressed that issue in its memorandum opinion. The majority states that Appellant is simply attempting to circumvent the bar against previously litigated issues by alleging ineffectiveness of counsel, but my reading of the record compels me to reach a different conclusion. On direct appeal to the Superior Court, Appellant's counsel did not set forth a question presented involving Appellant's acquittal and the effect of the acquittal. See Pa.R.A.P. 2116(a)("ordinarily no point will be considered which is not set forth in the statement of questions involved"). More importantly, Appellant's counsel conducted no research and presented absolutely no argument regarding the acquittal or whether the acquittal was grounds for a new trial.[1]See Pa.R.A.P 2119 & 2101; 199 Commonwealth v. Albrecht, 554 Pa. 31, 720 A.2d 693, 701 n. 9 (1998)(this Court cannot evaluate claims that counsel has not briefed); Commonwealth v. Sneddon, 738 A.2d 1026, 1028-29 (Pa.Super.1999)(the argument portion of an appellate brief must include a full discussion of the particular point raised along with citation to pertinent authorities). Direct appeal counsel merely mentioned Appellant's acquittal once, in the second to last line of the discussion section of the appellate brief. Amazingly, the majority concludes that this lone and passing reference to Appellant's acquittal constitutes effective and sufficient appellate advocacy. In my view, however, this reference to Appellant's acquittal in the first arson case falls far short of what is required by the law of this Commonwealth to properly raise an issue on appeal. My conclusion that appellate counsel failed to raise Appellant's acquittal of the first arson is supported by the fact that the Superior Court did not, at any point, mention Appellant's acquittal in its opinion on direct appeal. Nevertheless, the majority proclaims that this Court "should assume that the Superior Court read Appellant's brief and was therefore aware of his acquittal of the first arson when it considered the propriety of the trial court's evidentiary ruling on direct appeal." Majority Opinion at 195, n. 6 (emphasis added).[2] Initially, I believe it is improper to assume that the Superior Court considered an issue that it did not raise, much less discuss, in its opinion.[3] Moreover, in making this assumption, the majority necessarily admits that the Superior Court addressed only the trial court's evidentiary ruling, and not the issue regarding Appellant's subsequent acquittal. The PCRA clearly states that an issue has been previously litigated only if "the highest appellate court in which the petitioner could have had review as a matter of right has ruled on the merits of the issue." 42 Pa.C.S § 9544(a)(2). In order to be previously litigated, an appellate court must have, at the very least, addressed the merits of a claim on direct appeal. See Commonwealth v. Copenhefer, 553 Pa. 285, 719 A.2d 242, 252 (1998)(claim previously litigated where this Court specifically addressed the argument on direct appeal); Commonwealth v. Bond, 428 Pa.Super. 344, 630 A.2d 1281, 1282 (1993)(claims finally litigated where discussed thoroughly by Superior Court on direct appeal). Since the Superior Court on direct appeal did not even mention Appellant's subsequent acquittal in the first arson case, I am perplexed 200 by the majority's conclusion that the Superior Court's opinion constituted a ruling on the merits as to Appellant's PCRA claim.[4] Based on the reasoning set forth above, I cannot agree with the majority that Appellant's claim was previously litigated under the PCRA. Given my belief that Appellant's ineffectiveness claim is properly before the Court, the issue then becomes whether counsel's failure to brief and argue Appellant's acquittal of the first arson on direct appeal entitles him to relief under the PCRA.[5] Resolution of this issue is, in my view, controlled by this Court's decision in Commonwealth v. Fisher, 527 Pa. 345, 591 A.2d 710 (1991). The jury in Fisher convicted the defendant ("Fisher") of murder. Prior to the murder trial, Fisher had been convicted in federal court for conspiracy to violate the constitutional rights of a government informant scheduled to testify at a then-imminent drug trial. The informant had been murdered and his death was an integral issue regarding the motivation for the murder in Fisher's state case. During voir dire in the state murder case, the prosecution asked whether a potential juror had read anything about Fisher's earlier federal conviction. The individual responded affirmatively and was later selected to sit as a member of the jury. Following his conviction in the state murder case, Fisher's federal conviction was reversed and he was completely discharged from the federal case. On appeal from the murder conviction, this Court unanimously concluded that, given Fisher's subsequent acquittal on the federal charges, the question asked by the prosecutor during voir dire was prejudicial. Id. at 711. The Court reasoned that although evidence regarding the federal conviction may have been relevant at the time the prosecutor questioned the juror, the subsequent acquittal caused the evidence to lose its pertinency and to become unduly prejudicial. Id. Explaining that the effect of the prosecutor's inquiry on the jury was "inestimable," the Court reversed Fisher's murder conviction and ordered a new trial. Id. The validity of Fisher was subsequently reaffirmed in Commonwealth v. Murphy, 540 Pa. 318, 657 A.2d 927 (1995), where this Court drew a distinction between being discharged from a case and being granted a new trial. In Murphy, the Court held there was no error in admitting evidence of an alleged prior crime where the defendant was convicted but later granted a new trial by this Court on appeal. Id. at 932-33. The Court explained that the defendant had not been discharged on the prior crime because the case had been reversed and remanded for a new trial. Id. at 932. On remand, the defendant pled guilty, thereby admitting to 201 the evidence regarding the prior crime that had been presented to the jury in the subsequent case. The Murphy Court specifically distinguished this factual scenario from Fisher, where Fisher's federal conviction was reversed and he was completely discharged from that case. Murphy, 657 A.2d at 932-33. In my view, the instant case likewise differs from Murphy. Unlike the defendant in Murphy, Appellant was not granted a new trial on appeal from the first arson. Instead, Appellant was completely discharged from the first arson case when a jury found him not guilty of all charges. See United States v. DiFrancesco, 449 U.S. 117, 129, 101 S.Ct. 426, 66 L.Ed.2d 328 (1980)(the law attaches particular significance to an acquittal); Commonwealth v. D.M., 548 Pa. 131, 695 A.2d 770, 772-73 (1997)(a defendant enters a trial cloaked in the presumption of innocence and when the fact-finder reaches a verdict of acquittal, there is no justification to undermine the verdict because the defendant has achieved the strongest vindication possible under our criminal tradition, laws and procedures). Thus, I believe Appellant's case is analogous to Fisher. Appellant's acquittal in the first arson case similarly affected the relevancy and concomitant prejudice of the evidence concerning motive and intent in the instant case. In fact, Appellant's case presents a stronger justification for a new trial than the factual scenario before the Court in Fisher. In Fisher, the prosecutor relied upon a conviction that was subsequently reversed. Here, the prosecutor used evidence of an alleged bad act for which Appellant was later tried and acquitted. The effect of the prior crimes evidence on the jury, without the jurors knowing of the subsequent acquittal, is, as it was in Fisher, inestimable.[6] Based on the facts of record and prior decisions of this Court, I believe that Appellant's ineffectiveness claim has arguable merit, that Appellant's counsel had no reasonable basis for failing to brief and argue Appellant's subsequent acquittal of the prior arson, and that if counsel had properly briefed and argued this issue there is a reasonable probability that the outcome of the proceedings would have been different. See Commonwealth v. Kimball, 555 Pa. 299, 724 A.2d 326, 333 (1999)(setting forth the standard for evaluating a claim of ineffective assistance of counsel). Accordingly, I would grant Appellant a new trial.[7] NOTES [1] 18 Pa.C.S § 2502(b). [2] 18 Pa.C.S. § 3301(a)(1). [3] 18 Pa.C.S. § 2705. [4] 18 Pa.C.S. § 3303(2). [5] 18 Pa.C.S. § 4952(a)(1). [6] Appellant points to the issues framed by his appellate counsel in the Superior Court brief as proof that counsel failed to raise the issue of his subsequent acquittal of the first arson. The following testimony from Appellant's direct appeal counsel demonstrates that counsel brought Appellant's acquittal of the first arson to the Superior Court's attention: Q: Let me just ask you in your brief as to that issue, you state that the issue is did the trial court err in denying the Defendant's repeated requests both prior to and during trial on thewith thewithin charges that [sic] Commonwealth be directed not to make any reference to either a separate arson charge which was then pending against the Defendant or matters related thereto. That's the statement of the issues, correct? A: Right. Q: There is nothing within the statement of that issue that relates to the subsequent acquittal, is that right? A: That's true. It's in the body of the argument. .... Q: Let me just show you a copy of your brief. Here's your argument relative to that issue. And could you justcould you just tell us where in this you specifically speak to the issue of the acquittal? A: In the last paragraph, the last sentence, last couple sentences of the. Q: And that's on page 12 of your brief, right? A: Yes. Q: And in essence you just make the statement that in fact the Defendant was later acquitted of the first arson charge. So there is no question that the prejudice was real? A: Uh-huh. Notes of Testimony, PCRA hearing, 6/26/98, pp. 26-28. We should assume that the Superior Court read Appellant's brief and was therefore aware of his acquittal of the first arson when it considered the propriety of the trial court's evidentiary ruling on direct appeal. Consequently, as discussed further infra, the issue underlying Appellant's present claim of ineffective assistance of counsel has been previously litigated. [7] In Dowling, the government introduced evidence of Dowling's involvement in an attempted robbery, of which Dowling had previously been acquitted, as proof of identity in the bank robbery for which he was on trial and to establish a connection between Dowling and a co-conspirator in the bank robbery. Dowling, 493 U.S. at 345, 110 S.Ct. 668. Dowling argued that due to his acquittal of the attempted robbery, collateral estoppel and double jeopardy principles should prohibit the government from introducing any evidence of Dowling's involvement in the attempted robbery as evidence of identity in the bank robbery trial. The Court rejected this argument: "we decline to extend ... the collateral estoppel component of the Double Jeopardy Clause to exclude in all circumstances.... relevant and probative evidence that is otherwise admissible under the Rules of Evidence simply because it relates to alleged criminal conduct for which a defendant has been acquitted." Id. at 348, 110 S.Ct. 668. Appellant's situation merits less concern than the position rejected by the Court in Dowling. At the time of Appellant's trial on the second arson and murder charges, the case against Appellant for the first arson was still pending. The trial court in Appellant's case, therefore, was not faced with evidence of Appellant's involvement in prior criminal activity for which he had already been acquitted, as happened in Dowling. [1] At the PCRA hearing. Appellant's direct appeal counsel testified as follows: Q. [PCRA counsel]: At the time of your appointment I think we have already established that [Appellant] had been found not guilty of the first arson, is that correct? A. [direct appeal counsel] Yep. Q. And you raised in your Superior Court brief the issue of the prior crimes evidence coming in in the murder arson case, is that correct? A. Yes. Q. And you raised it in the context of the order in which the cases had been charged, is that true? A. Yes. Q. And your arguments would be fair to say basically tracked [trial counsel's] arguments pretrial as to why this should not occur? A. Yes, that's fair. Q. Is that fair to say? A. Yes. Q. Did you research at that time the specific issue ofthe significance of the prior crimes resulting in an acquittal? A. My research was limited to the issue I have raised in my brief. N.T., PCRA Hearing, 6/26/98, at 24-25. [2] Even assuming that the Superior Court was "aware" of Appellant's acquittal in the first arson, that does not necessarily mean that the issue was properly raised by counsel or that the Superior Court considered the effect of Appellant's acquittal in rendering its decision. [3] I am troubled by the majority's use of leaping logic when it concludes that the Superior Court considered and rejected a claim based solely on the majority's assumption that the Superior Court considered Appellant's acquittal. Based on the majority's reasoning, an appellate court reviewing a PCRA petition may now assume that a lower court has addressed an issue not even raised by counsel, thereby transforming unraised claims into previously litigated claims. Taking the majority's reasoning to its logical conclusion, an appellate court may sua sponte consider any number of issues that it may be "aware" of, despite counsel's failure to properly raise the issues. [4] Although it is undisputed that one of the purposes of the PCRA is to preclude defendants from relitigating the merits of issues long since decided on direct appeal, Commonwealth v. Buehl, 540 Pa. 493, 658 A.2d 771, 775 (1995), unlike the majority, I do not believe that the previously litigated preclusion should be extended to include claims that this Court assumes have been addressed by the lower courts. [5] Despite concluding that Appellant's claim was previously litigated, the majority nevertheless proceeds to address the underlying merits of the claim. It is beyond dispute that if a defendant's claim was previously litigated, he is not eligible for relief under the PCRA. 42 Pa.C.S. § 9544(a); Commonwealth v. Lewis, 560 Pa. 240, 743 A.2d 907, 909 (2000). Thus, it seems improper for the majority to address the merits of Appellant's claim after concluding that the claim is not eligible for review by this Court. [6] If the order of the two trials had been reversed and the Commonwealth introduced prior crimes evidence of the first arson, it is likely that Appellant would have been permitted to inform the jury of his acquittal in the arson case. See Dowling v. United States, 493 U.S. 342, 345-46, 110 S.Ct. 668, 107 L.Ed.2d 708 (1990)(court gave limiting instruction as to prior crimes evidence and twice told jury of defendant's prior acquittal). In my view, the majority unjustifiably rewards the Commonwealth for choosing to prosecute the murder/arson case before the first arson case. By prosecuting the murder/arson case first, the Commonwealth was able to argue that the first arson was motive for murder without having to prove Appellant's involvement in the first arson beyond a reasonable doubt. The majority's decision has the effect of allowing the Commonwealth to charge a defendant with a crime and introduce evidence of that crime in a trial for a second crime, without regard for the ultimate disposition of the charges in the first case. [7] In addition to arguing that he is entitled to a new trial, Appellant argues that on remand, evidence of the first arson should be completely excluded from a new trial, or that in the alternative, he should be allowed to present evidence of the acquittal to the jury. That issue is beyond the scope of the issue on which this Court granted allocatur and therefore, is not squarely before the Court at this juncture of Appellant's case. Moreover, I believe that the trial court would be better equipped to address this evidentiary issue in the first instance on remand.	{ "pile_set_name": "FreeLaw" }
919 F.2d 736 U.S.v. Covarrubias-Paez* NO. 90-1862 United States Court of Appeals,Fifth Circuit. NOV 06, 1990 1 Appeal From: N.D.Tex. 2 AFFIRMED. * Fed.R.App.P. 34(a); 5th Cir.R. 34.2	{ "pile_set_name": "FreeLaw" }
FILED BY CLERK IN THE COURT OF APPEALS APR 22 2009 STATE OF ARIZONA COURT OF APPEALS DIVISION TWO DIVISION TWO THE STATE OF ARIZONA, ) ) 2 CA-CR 2008-0226 Appellee, ) DEPARTMENT A ) v. ) OPINION ) ORVIE ROWLAND STRECK, ) ) Appellant. ) ) APPEAL FROM THE SUPERIOR COURT OF PIMA COUNTY Cause No. CR-20073384 Honorable Hector E. Campoy, Judge AFFIRMED AS MODIFIED Terry Goddard, Arizona Attorney General By Kent E. Cattani and Alan L. Amann Tucson Attorneys for Appellee Isabel G. Garcia, Pima County Legal Defender By Stephan J. McCaffery Tucson Attorneys for Appellant E S P I N O S A, Judge. ¶1 Following a jury trial, Orvie Streck was convicted of theft of a means of transportation, sentenced to two years’ probation, and ordered to pay $1,698.17 in restitution to the victim. On appeal, he contends his conviction should be overturned because a tractor is not a means of transportation. He also argues the trial court erred in imposing restitution. For the following reasons, we affirm Streck’s conviction and sentence but modify the court’s award of restitution. Factual and Procedural Background ¶2 We view the facts and all reasonable inferences they permit in the light most favorable to sustaining the jury’s verdict. See State v. Tamplin, 195 Ariz. 246, ¶ 2, 986 P.2d 914, 914 (App. 1999). In 2006, Streck worked on and occasionally stayed at the victim’s farm near Tucson. In July, the victim moved to Texas, leaving Streck to tend the farm and prepare it for eventual sale. After she had gone, Streck sold her tractor but told her he had discovered it missing. The victim immediately reported the missing tractor to the Pima County Sheriff’s Office. Approximately a year later, the victim’s husband received information about the tractor’s whereabouts. The victim returned to Tucson to investigate and called the police when she saw the tractor in a neighbor’s backyard. A police officer questioned the neighbor who reported he had purchased the tractor from Streck. Streck was subsequently charged with theft of a means of transportation and was convicted and sentenced as outlined above. This appeal followed. Discussion ¶3 Streck argues his conviction is not supported by sufficient evidence because a tractor is not a “means of transportation” under A.R.S. § 13-1814 and, therefore, his 2 conviction constitutes fundamental error.1 Because Streck does not otherwise contest the sufficiency of the evidence to support the jury’s verdict, the validity of his conviction turns solely on the legal question of whether a tractor is a means of transportation for purposes of § 13-1814. We review de novo a trial court’s interpretation of a statute. In re Paul M., 198 Ariz. 122, ¶ 1, 7 P.3d 131, 132 (App. 2000). ¶4 A person commits theft of a means of transportation if he or she knowingly, and without lawful authority, “[c]ontrols another person’s means of transportation with the intent to permanently deprive the person of the means of transportation.” § 13-1814(A). A “means of transportation” is defined as “any vehicle,” see A.R.S. § 13-1801(A)(9), which is in turn defined as “a device in, upon or by which any person or property is, may be or could have been transported or drawn upon a highway, waterway or airway, excepting devices moved by human power or used exclusively upon stationary rails or tracks.” A.R.S. § 13-105(40).2 ¶5 Although Streck concedes a tractor satisfies the statutory definition of “vehicle” in § 13-105(40), he urges us to look beyond the plain meaning of the statute, arguing “absurd consequences” could result if such things as a riding lawnmower or pair of 1 Streck did not present this argument below and therefore is entitled to a review for fundamental error only. See State v. Moreno-Medrano, 218 Ariz. 349, ¶ 7, 185 P.3d 135, 138 (App. 2008). 2 Section 13-105 was amended and its subsections renumbered effective December 31, 2008. See 2008 Ariz. Sess. Laws, ch. 301, §§ 10, 120. No substantive changes were made to the definition of a “[v]ehicle” and, for ease of reference, we refer to the subsection as it is currently numbered. 3 water skis were classified as vehicles. Streck relies on M.J.S. v. State, 453 So. 2d 870 (Fla. Dist. Ct. App. 1984), in which the Florida District Court of Appeal ruled that a backhoe was not a vehicle under a Florida statute similar to Arizona’s. 453 So. 2d at 871-72. Citing A.R.S. § 28-2153, Streck also points out that “Arizona’s statutes treat tractors differently from other automotive equipment” by not requiring their registration with the Department of Transportation. ¶6 We need not look to Florida, however, because in In re Adam P., 201 Ariz. 289, 34 P.3d 398 (App. 2001), Division One of this court, addressing a similar issue, held that a golf cart fit the definition of a vehicle because it is a device “upon which a person ‘is or may be transported’” and is explicitly described as a motor vehicle in A.R.S. § 28-101. 201 Ariz. 289, ¶ 10, 34 P.3d at 400, quoting §13-105(40) (formerly § 13-105(36)) (emphasis omitted). Streck urges us to discount Adam P., arguing, “The court’s method of statutory interpretation in Adam P. was defective” because it did not consider whether its interpretation would lead to “absurd consequences.” 3 But Streck cites no authority supporting his contention that the court should have looked beyond the plain meaning of the statute to avoid an absurd result on a question not before it. Likewise, he does not explain how the court erred in applying the definitions found in §§ 13-105 and 28-101 to conclude a golf cart is a “vehicle” and a “means of transportation” for purposes of §§ 13-105 and 13-1814. 3 Because the issue was not squarely before it, the court in Adam P. expressly declined to consider whether a “go-ped” falls within the statutory definition of a vehicle, and we likewise see no reason to dwell on whether riding lawnmowers or water skis are vehicles for purposes of this case. See Adam P., 201 Ariz. 289, ¶ 11, 34 P.3d at 400. 4 ¶7 When we interpret a statute, our analysis begins and ends with its plain language if it is unambiguous. See Bentley v. Building Our Future, 217 Ariz. 265, ¶ 13, 172 P.3d 860, 865 (App. 2007). As mentioned above, Streck does not dispute that a tractor falls within the plain language of § 13-105(40), as “a device in, upon or by which any person or property” can be “transported or drawn upon a highway.” Clearly, tractors can be and have been driven on Arizona highways. See, e.g., Williams ex rel. Dixon v. Thude, 180 Ariz. 531, 533, 885 P.2d 1096, 1098 (App. 1994) (involving collision between car and tractor on highway); Chavarria v. Ford Motor Co., 124 Ariz. 158, 158-59, 602 P.2d 826, 826-27 (App. 1979) (involving tractor rollover accident on street); Harbor Ins. Co. v. United Servs. Auto. Ass’n, 114 Ariz. 58, 60, 559 P.2d 178, 180 (App. 1976) (involving collision between van and tractor on public road); see also A.R.S. § 28-101(51) (defining “highway” as a “way [that] is open to the use of the public for purposes of vehicular travel”). ¶8 Although we agree that tractors are treated differently from other automotive equipment, see Williams, 180 Ariz. at 535, 885 P.2d at 1100, nothing in the statutory definition suggests § 13-105(40) applies only to vehicles regularly traveling on highways and subject to the same regulations as automobiles. Indeed, the legislature has expressly defined a farm tractor as a “motor vehicle” in § 28-101(21) for the purposes of our transportation laws. See Adam P., 201 Ariz. 289, ¶ 10, 34 P.3d at 400 (employing definition from title 28, A.R.S., to interpret § 13-105). Accordingly, we hold that a tractor is a “vehicle” for the purposes of § 13-1814. 5 ¶9 Streck next contends a portion of the restitution he was ordered to pay was for noncompensable expenses. We review a trial court’s award of restitution for an abuse of discretion. See In re Stephanie B., 204 Ariz. 466, ¶ 8, 65 P.3d 114, 116 (App. 2003). Pursuant to § 13-804, the trial court ordered Streck to pay the victim $1,677.40 for lost wages and towing, and $113.77 for expenses she incurred in traveling back to Tucson from Texas to investigate the missing tractor. Citing State v. Guilliams, 208 Ariz. 48, ¶ 1, 90 P.3d 785, 787 (App. 2004); State v. Wilkinson, 202 Ariz. 27, 39 P.3d 1131 (2002); and our recent opinion in State v. Slover, No. 2 CA-CR 2007-0379, 2009 WL 295027 (Ariz. Ct. App. Feb. 9, 2009), Streck argues the victim’s investigation expenses were not direct but consequential damages resulting from the theft of the tractor. We agree. ¶10 We find Slover controlling. There, we reversed a restitution award of attorney fees to a widow after she had hired an attorney who pressured the state to prosecute her husband’s murder, actively searched for the defendant in other states, and assisted in the preservation of evidence. Id. ¶¶ 7, 9. We determined such tasks “were actually the state’s responsibility . . . [and] not incurred as a direct result of the offenses.” Id. ¶ 9. Similarly, here, the victim’s costs arose “from either the state’s inability to [investigate] the case independently and competently or [her] mistrust that it would do so.” Id. ¶ 8. Investigating and locating the stolen tractor were the state’s responsibility, and private costs associated with these tasks, while understandable from the victim’s perspective, were not properly included in the restitution award. 6 Disposition ¶11 For the reasons set forth above, Streck’s conviction and sentence are affirmed, but the total restitution award is modified and reduced by the sum of $113.77,4 for expenses improperly included in the award. PHILIP G. ESPINOSA, Judge CONCURRING: JOHN PELANDER, Chief Judge PETER J. ECKERSTROM, Judge 4 Although Streck argues generally that the court erred in imposing restitution for costs, including the victim’s “lost wages and travel incurred for her investigation,” at the restitution hearing he expressly acquiesced to the towing and lost wages, as compensable expenses. Therefore, we vacate only the portion of the award pertaining to travel costs that Streck challenged below. See State v. Baltzell, 175 Ariz. 437, 439, 857 P.2d 1291, 1293 (App. 1992) (failure to object to components of award at restitution hearing waives all but fundamental error); Moreno-Medrano, 218 Ariz. 349, ¶ 17, 185 P.3d at 140 (appellant must argue fundamental error to invoke review of waived issue). 7	{ "pile_set_name": "FreeLaw" }
771 P.2d 1358 (1989) Larry Paul HAMILTON, Appellant, v. STATE of Alaska, Appellee. No. A-2341. Court of Appeals of Alaska. April 14, 1989. 1359 Michael Dieni, Asst. Public Advocate, and Brant McGee, Public Advocate, Anchorage, for appellant. Tonja Woelber, Asst. Atty. Gen., Office of Sp. Prosecutions and Appeals, Anchorage, and Grace Berg Schaible, Atty. Gen., Juneau, for appellee. Before BRYNER, C.J., and COATS and SINGLETON, Judges. OPINION SINGLETON, Judge. Larry Paul Hamilton was convicted by a jury of sexual assault in the first degree, an unclassified felony, in violation of AS 11.41.410(a)(1). Judge Peter A. Michalski found that Hamilton had used a dangerous instrument a knife in perpetrating his offense and was therefore subject to the ten-year presumptive sentence. AS 12.55.125(i)(2). He also found a number of aggravating factors and sentenced Hamilton to twenty years with five years suspended. Hamilton was placed on probation for five years after completion of his prison sentence. Hamilton appeals, challenging his conviction and his sentence. We will deal with Hamilton's contentions in order, setting out the appropriate facts where necessary to illuminate our discussion. Hamilton first argues that the prosecutor was permitted to make improper comments on his pre-arrest silence and, inferentially, on his post-arrest silence. See Doyle v. Ohio, 426 U.S. 610, 617-19, 96 S.Ct. 2240, 2244-45, 49 L.Ed.2d 91 (1976); Bloomstrand v. State, 656 P.2d 584, 587 (Alaska App. 1982). The record reflects that C.M. and Hamilton were together in C.M.'s vehicle during the morning hours of May 19, 1986. C.M. testified that Hamilton sexually assaulted her during this time. Hamilton concedes sexual activity, but he claims that C.M. consented. C.M. reported the alleged assault to the police and was examined by a physician. Officer John Daly heard a description of the suspect and thought of Hamilton. Police officers then went to Hamilton's home and told him they were searching for a prowler. The officers asked Hamilton if he had seen anything, specifically asking at what time he had come home. Hamilton indicated that he had arrived home between 2:00 and 2:30 a.m., having been dropped off by a male acquaintance and that he had seen nothing. C.M.'s testimony indicated that she had dropped Hamilton off at approximately 1360 4:38 a.m. Hamilton did not mention to the police having been with C.M. During her opening statement, the prosecutor said: Larry Paul Hamilton didn't tell the police officers, hey, yeah, I had a good time last night. Don't tell my wife, but this lady and I really got it on. He didn't say that. He never told the police that he had had intercourse with anyone. He never told the police he had been with [C.M.]. He never told the police he'd been with any woman that night. And he never told the police that he had taken her gone with [C.M.] and taken her out to a remote area and forced her to perform sexual acts on him. He told the police, I came home around 2:00 or 2:30 this morning, and it was a male friend who dropped me off. He had his chance to tell the police that he had intercourse with a woman not his wife, but he didn't. And without [C.M.'s] consent. This is a case of sexual assault in the first degree. Defense counsel moved for a mistrial based on the prosecutor's reference to what Hamilton did not tell the police. The trial judge provisionally denied the motion, but indicated that he would permit the parties to brief the issue, and he would obtain a transcript of the argument so he could better understand precisely what was said. Later, during direct examination of Officer Gerald Weeks, the investigating officer, the following exchange took place: Q. During the morning of May 19th when you contacted Mr. Hamilton did he say anything about having been with [C.M.] the previous evening? A. No, he didn't. Q. Did he say anything about knowing [C.M.]? A. No, he didn't. Q. Did he say anything about having met a woman? A. No. Q. Did he say anything about having gone to Wasilla? A. No. Q. Did he say anything about having been dropped off 1.2 miles from home? A. No, he didn't. Defense counsel moved for a mistrial, or, in the alternative, for the court to strike this exchange on the grounds that the exchange amounted to an impermissible comment on Hamilton's right to silence. The court denied the motion for mistrial, but granted the motion to strike. The court gave the following curative instruction to the jury: The jury is back with us and we are on record in the case of State of Alaska versus Larry P. Hamilton. Ladies and gentlemen, before you left there was an objection to the last five questions and their responses from the witness. The court has ruled that that was properly objected to. In other words, it was correct to object to that and the last five questions and responses are not to be considered by you in your deliberations. You are to draw no inferences from the defendant's not volunteering additional statements about the events of the early morning of the 19th of May, 1986. Under the circumstances, we are satisfied that the trial court's curative instruction removed any error and that the trial court did not abuse its discretion in denying a mistrial. See Roth v. State, 626 P.2d 583, 585 (Alaska App. 1981) (citing Maze v. State, 425 P.2d 235, 239 (Alaska 1967)). But see Dorman v. State, 622 P.2d 448, 458 (Alaska 1981). Hamilton testified at trial that any sexual contact which occurred between himself and C.M. was consensual. Hamilton also testified that during the course of his sexual involvement with C.M., a car had stopped near their location. He further testified that C.M. had gotten out of her vehicle and made contact with the driver of the other car. Hamilton then testified that 1361 C.M. advised him that she was "going to have to think of something ... to cover [her] ass." During rebuttal argument, the prosecutor commented, "Something about a mystery car, that we hear about for the first time this morning, because he can't explain [the physical evidence in the case tying him to the offense]." Defense counsel moved for a mistrial based on this comment, claiming that the prosecutor's comments were an attempt "to say to the jury, do not believe him because he did not tell this, did not make it voluntary explanations to the police... ." Defense counsel did not argue that the comment violated any protective order implicit in the trial court's earlier striking of questions regarding pre-arrest silence. The prosecutor argued that she was not commenting on pre-arrest silence, but rather on defense counsel's failure to bring up the "mystery car" in connection with his earlier cross-examination of C.M. The trial court denied the motion, finding that the comment was "not a comment on silence, but a statement, an argument... ." The state concedes that it is conceivable that the prosecutor's comment could imply to the jury that Hamilton did not give a post-arrest exculpatory statement that included the detail of the "mystery car." However, the state argues that a mere implication is not enough to trigger the protection of the constitution. In the state's view, the question is whether "`the jury would naturally and necessarily take [the argument] to be a comment on' [the defendant's] exercise of his right to remain silent." United States v. Barton, 731 F.2d 669, 675 (10th Cir.1984) (quoting Knowles v. United States, 224 F.2d 168, 170 (10th Cir.1955)). We agree with the state that the prosecutor's comment and rebuttal would not "naturally and necessarily" be understood as a comment on Hamilton's post-arrest silence because there was no time specified. We agree with the prosecutor's suggestion that the jury would more reasonably interpret the statement as a comment on defense counsel's failure to bring the matter up with C.M. during cross-examination. We find no error. Hamilton next makes a number of arguments regarding the trial court's finding of aggravating factors and the trial court's enhancing his sentence beyond the ten-year presumptive term specified for one who uses a dangerous instrument in perpetrating a sexual assault in the first degree. He particularly challenges two findings: (1) that Hamilton's prior criminal history includes conduct involving aggravated or repeated instances of assaultive behavior, AS 12.55.155(c)(8); and (2) that Hamilton had a criminal history of repeated instances of conduct violative of criminal laws, whether punishable as felonies or misdemeanors, similar in nature to the offense for which he was being sentenced. AS 12.55.155(c)(21). Essentially, the state offered hearsay evidence to establish that Hamilton had sexually assaulted two other women. In one case, Hamilton was ultimately convicted of assault in the fourth degree. The second case was not prosecuted. Hamilton did not ask to cross-examine either of the complaining witnesses. He did, however, enter a testimonial denial that he had sexually assaulted either of them. He argues that where a defendant enters a testimonial denial to verified hearsay claims of prior criminal behavior, the state must either produce the declarants, establish their unavailability, or abandon the issue. The state points out that the evidence rules do not apply to sentencing, A.R.E. 101(c), and that the United States Supreme Court has held that a defendant's right to confront and cross-examine his accusers does not apply at sentencing. Williams v. New York, 337 U.S. 241, 69 S.Ct. 1079, 93 L.Ed. 1337 (1949). The state argues that when finding aggravating factors by clear and convincing evidence, the trial judge may rely on verified information even though the defendant testimonially denies it. The appellate courts of this state have considered similar arguments in a variety 1362 of cases. See Nukapigak v. State, 562 P.2d 697, 701 (Alaska 1977), aff'd on rehearing, 576 P.2d 982 (Alaska 1978); Agwiak v. State, 750 P.2d 846, 849 (Alaska App. 1988); Pickens v. State, 675 P.2d 665, 670-71 (Alaska App. 1984); Dexter v. State, 672 P.2d 144, 146 (Alaska App. 1983); Willard v. State, 662 P.2d 971, 976-77 (Alaska App. 1983). This issue does not admit of an easy answer. On the one hand, as the state points out, both state and federal courts have been willing to consider verified information adverse to a defendant even though it was based upon hearsay at sentencing. On the other hand, the courts of this state have expressed concern about hearsay in a variety of contexts beyond the trial of the case. See, e.g., State v. Gieffels, 554 P.2d 460, 462-65 (Alaska 1976) (grand jury) and Taggard v. State, 500 P.2d 238, 242-43 (Alaska 1972) (grand jury). In Gieffels, the supreme court held, in interpreting Alaska Rule of Criminal Procedure 6(r), that hearsay could not be presented before a grand jury in the absence of compelling justification. The supreme court construed compelling justification to equate with necessity and suggested that necessity would normally require a finding of the unavailability of the declarant. Gieffels, 554 P.2d at 464-65. In Taggard, the supreme court indicated that if hearsay was to be used, the reliability of the hearsay declarant must be established and the declarant's statements corroborated. Taggard, 500 P.2d at 242-43. The legislature incorporated the requirements of reliability and corroboration into AS 12.40.110 which permits, under limited circumstances, the use of hearsay statements before the grand jury from child accusers in sexual abuse prosecutions. We have also considered the use of hearsay in resolving factual disputes in motion practice. See Adams v. State, 704 P.2d 794 (Alaska App. 1985). We concluded that the state may not rely on affidavits to contradict a defendant's sworn testimony. Id. at 797-98. See also Alexander v. State, 611 P.2d 469, 474-75 (Alaska 1980) (adopting a similar rule). We recognize that both grand jury proceedings and motion practice differ from sentencing in two significant regards. First, both will normally deal with contemporaneous events. Second, those events normally occur within Alaska. In contrast, a defendant's criminal career may span many years and may extend well beyond Alaska. Nevertheless, we believe that the risks of the abuse of hearsay are sufficiently important that the state should be required to prove the unavailability of declarant witnesses before using their hearsay declarations against a defendant who denies the allegations under oath and submits to cross-examination. This is true, at least in those cases, such as this one, where the state relies on hearsay which would not be admissible at trial and which is being used to prove an aggravating factor by clear and convincing evidence. Given the differences between grand jury proceedings and sentencing, we believe the trial court should be more flexible in finding unavailability. Moreover, where adverse witnesses are located out of state, or a substantial distance from the court house, the court might permit depositions or telephone interrogations in preference to requiring the state to pay to bring the declarants to the sentencing hearing. Compare Alaska R.Civ.P. 99[1]with Alaska R.Crim.P. 38.1.[2] Some reasonable opportunity for cross-examination 1363 should be provided, however, where possible.[3] Where the declarants are truly unavailable and the defendant denies their allegations under oath, then we believe that the state should bear the burden of proving the veracity of each declarant and corroborating his or her testimony. See, e.g., Murray v. State, 770 P.2d 1131 at 1136-1137, (Alaska App., March 17, 1989) (outlining factors which the trial court should consider in determining the reliability of child hearsay declarants and the corroboration of their testimony in connection with grand jury presentations under current AS 12.40.110). The state did not undertake to show the unavailability of the hearsay declarants in this case. Nor was the trial court's attention focused on establishing the veracity of the declarants and the corroboration of their testimony. Consequently, it is necessary for us to remand for resentencing. Our determination to remand moots, at least for the present, Hamilton's other arguments regarding sentencing. Because our remand calls for a new sentencing in this case, Hamilton will have an opportunity to present those arguments to the trial court. Under the circumstances, we do not believe that the law of the case doctrine should prevent a full and complete resentencing in this matter. The judgment of the superior court is AFFIRMED, in part, and REVERSED, in part, and this case is REMANDED for resentencing. COATS, Judge, concurring. In this case Hamilton faced a presumptive sentence of ten years. Judge Michalski found that several aggravating factors applied to Hamilton's sentence. Two critical aggravating factors were that Hamilton's prior criminal history included conduct involving aggravated or repeated instances of assaultive behavior, AS 12.55.155(c)(8), 1364 and that Hamilton had a criminal history of repeated instances of conduct violative of criminal laws, whether punishable as felonies or misdemeanors, similar in nature to the offense for which he was being sentenced. AS 12.55.155(c)(21). These aggravating factors were based on hearsay evidence that Hamilton had committed two prior sexual assaults. Hamilton testified at the sentencing hearing and denied that he had committed these alleged prior assaults. It appears that Judge Michalski placed great weight on the evidence that Hamilton committed the prior assaults; he sentenced Hamilton to twenty years with five years suspended. Under these circumstances, I have no quarrel with the majority's decision requiring more than the hearsay which the state presented at sentencing to show that Hamilton committed the two prior assaults. I am not confident, however, that in every case where the defendant denies a material matter we should require the state either to call a witness to testify at the sentencing hearing or to prove the unavailability of a witness before using hearsay statements. I would prefer to resolve this issue on a case-by-case basis. It is important for the trial court to have as much reliable information as possible when sentencing a defendant. I am concerned that the rule which the court announces in this case may unduly restrict that information in other cases. NOTES [1] Civil Rule 99 provides: (a) Authorization for Telephonic Participation. (1) Upon stipulation of all counsel, the court may conduct any hearing by telephone conference with telephonic participation by one or more of the parties, counsel, witnesses or the judge. (2) Without stipulation of the parties, the court may conduct non-dispositive or non-evidentiary proceedings with telephonic participation by one or more of the parties, counsel, or the judge. (3) Upon request, any party or counsel may be allowed to participate telephonically in the argument of dispositive matters or in the examination of witnesses physically present before the court. (4) In any proceeding in which the court is authorized to proceed ex parte, the court may contact the non-appearing party or counsel by telephone and in the interest of justice receive evidence or argument without stipulation of the parties. (5) The court may in the interest of justice for good cause shown order that depositions be taken telephonically. (b) Procedure. The following procedure must be observed concerning telephonic participation in court hearings: (1) Hearings involving telephonic participation must be scheduled in the same manner as other hearings. (2) When telephonic participation is requested, the court, before the hearing, shall designate the party responsible for arranging the call and the party or parties responsible for payment of the call pursuant to Administrative Rule 48. (3) Upon convening a telephonic proceeding, the judge shall: (i) Recite the date, time, case name, case number, names and locations of parties and counsel, and the type of hearing. (ii) Ascertain that all statements of all parties are audible to all participants; (iii) Give instructions on how the hearing is to be conducted, including notice that in order to preserve the record speakers must identify themselves each time they speak. (4) A verbatim record must be made in accord with Administrative Rule 35. (c) The right of public access to court proceedings must be preserved in accordance with law. [2] Criminal Rule 38.1 provides: (a) In any proceeding at which the defendant's presence is required under Criminal Rule 38(a), as modified by Rule 38.2, the defendant may waive the right to be present and request to participate by the telephone. The defendant's waiver of the right to be physically present may be obtained orally on the record or in writing. The court may allow telephonic participation of one or more parties, counsel or the judge at any proceeding in its discretion. The court may allow telephonic participation of witnesses at bail hearings, omnibus hearings, probation revocation hearings or at trial with the consent of the prosecution and the defendant. The court may allow telephonic participation of witnesses at other hearings in its discretion. (b) The provisions of AS 12.35.015 shall govern the issuance of search warrants by telephone. [3] In light of Williams, 337 U.S. 241, 69 S.Ct. 1079, the concerns voiced in Stores v. State, 625 P.2d 820 (Alaska 1980), are not in issue at sentencing. Cf. Kotzebue v. McLean, 702 P.2d 1309, 1315-16 (Alaska 1985) (considering telephonic depositions and testimony under the comparable civil rules).	{ "pile_set_name": "FreeLaw" }
799 F.Supp. 1275 (1992) UNITED STATES of America, Plaintiff, v. 789 CASES, MORE OR LESS, OF LATEX SURGEONS' GLOVES, AN ARTICLE OF DEVICE, etc., Defendant. Claim of Plastic Materials of Puerto Rico, Inc. Civ. No. 90-1777 (JP). United States District Court, D. Puerto Rico. August 20, 1992. 1276 1277 1278 1279 Silvia L. Carreño-Coll, Annamarie Kempic, Asst. U.S. Attys., Hato Rey, P.R., for plaintiff. Harry Anduze Montaño, Hato Rey, P.R., for claimant. OPINION AND ORDER PIERAS, District Judge. This is an in rem forfeiture action brought by the plaintiff, United States of America ("plaintiff"), pursuant to the Federal Food, Drug, and Cosmetic Act (the "Act"), 21 U.S.C. § 301 et seq. The requisite Initial Scheduling Conference and Pretrial Conference were held, and a Non-Jury Trial was conducted on September 313, 1991; February 1314, 1991; March 30 31, 1991; and April 3, 1992. Based on the evidence presented by the parties and after due deliberation, this Court now makes the following Findings of Fact and Conclusions of Law. 1280 FINDINGS OF FACT 1. Claimant, Plastic Materials of Puerto Rico, Inc., ("Plastic Materials" or "claimant"), manufactured the seized articles at a building in Loiza, Puerto Rico, (manufacturing facility), and stored certain of the seized articles, device components and accessories as well as finished product, at a warehouse in Luquillo, Puerto Rico. Cox Testimony, day 1, p. 16, 17, 31-44, 65, 104. See also P. González Testimony, day 11, p. 35-36. 2. Plastic Materials' represented that its gloves were to be used as surgeons gloves or as dental examination gloves. Cox Testimony, day 1, p. 21-22; Exhibits[1] 4, 5; P. González Testimony, day 11, p. 33, day 13, p. 120-121. 3. Plastic Materials' only customer for the seized articles was the United States Department of Defense. Testimony of Harold Gordon Cox (Cox Testimony), day 1 p. 21; Testimony of Peter González Diaz, day 11, p. 33, day 13, p. 120-121; Exhibits Y2, Z2, A3, and T7. 4. The Department of Defense purchased only latex surgeons and dental examination gloves from Plastic Materials. P. González Testimony, day 13, p. 121, Exhibits Y2, Z2, A3, and T7. 5. Plastic Materials is a manufacturer of medical devices. Cox Testimony, day 1, p. 20-21; P. González Testimony, day 11, p. 33, day 13, p. 121. 6. Plastic Materials manufactured the seized latex surgeons gloves and latex examination gloves. Cox Testimony, day 1, p. 21-22, Exhibits 4 and 5 (labeling for surgeons and dental examination gloves); P. González Testimony. 7. The FDA has statutory authority to conduct inspections of device manufacturers pursuant to 21 U.S.C. § 374. 8. Between February 12 and April 12, 1990, FDA conducted an inspection of claimant's manufacturing facility at Loiza, Puerto Rico, and its rented warehouse at Luquillo, Puerto Rico. Cox Testimony, day 1, p. 16, 65; Testimony of Dianiris Ayala Negrón (Ayala Testimony), day 11, p. 11-12; Testimony of Jorge L. Guadalupe (Guadalupe Testimony), day 7, p. 32-33; P. González Testimony, day 12, p. 5-7. 9. Following the FDA inspection, the FDA issued an eleven page, thirty-five item, list of inspection observations, Form 483, to Plastic Materials noting observed deficiencies in the manufacturing operation in the following categories, among others: 1) organization and personnel; 2) building and environmental controls; 3) manufacturing specifications and processes; 4) finished device inspection; and 5) records. Cox Testimony, day 1, p. 108, 109, 111, and Exhibit 42; P. González Testimony, day 12, p. 9. 10. Following the inspection, FDA also issued a three page, five item, list of inspection observations, Form 483, to Plastic Materials noting observed deficiencies in the warehouse at Loiza, Puerto Rico, pertaining to rodent activity and storage conditions for components and finished product. Cox Testimony, day 1, p. 109, and Exhibit 43. 11. Plastic Materials responded with a letter of explanation (Exhibit H3) in which the firm disputed its obligations under the device good manufacturing practice (GMP) regulations and the Act. P. González Testimony, day 123, p. 71-73; Testimony of Z. Frank Twardochleb (Twardochleb Testimony), day 5, p. 71-72, and Exhibit H3. 12. Therefore, Plastic Materials did not use adequate environmental controls in its manufacturing facility and warehouse. Twardochleb Testimony, day 4, p. 41; Testimony of Philip E. Nickerson (Nickerson Testimony), day 5, p. 91, 92, 99; Testimony of Paris Manaford Brickey (Brickey Testimony), day 4, p. 18. 13. Plastic Materials kept the manufacturing facility doors and unscreened windows open during the glove manufacturing process. Cox Testimony, day 1, p. 30; Exhibit 8; P. González Testimony, day 12, p. 58, 63-64. 14. The Luquillo warehouse that Plastic Materials used had gaps between the roof 1281 and walls and countless holes and openings in the external walls and doors. Cox Testimony, day 1, p. 67, 72; Exhibits 21 and 22. 15. Open doors and windows and holes and gaps in walls and doors provide easy access for rodents, pests, and airborne contaminants. Brickey Testimony, day 4, p. 15; Twardochleb Testimony, day 4, p. 42; Nickerson Testimony, day 5, p. 92, 107. 16. Plastic Materials did not enclose the area in the manufacturing facility that was used to apply cornstarch to the gloves and the airborne cornstarch spread throughout the manufacturing facility and settled on equipment, including the equipment used to process the liquid latex. Cox Testimony, day 1, p. 31, 35, 38, 39, Exhibits 9, 10, 11, 12, 13. 17. The seized cornstarch, latex, package labels, and packaging material was for use in manufacturing latex surgical and dental examination gloves, Exhibits 4, 5, and 36 (labeling), Testimony of Maria Esther Rosario (Rosario Testimony), day 9, p. 20-23; because Plastic Materials had no other use for those items other than manufacturing such surgical and dental examination gloves. P. González Testimony, day 11, p. 33, 80, day 12, p. 128, day 12, p. 120, 121. 18. Plastic Materials failed to organize its manufacturing facility and warehouse to prevent mix-ups; the lot numbers on an outer carton of gloves was different from the lot number on the inner glove packages, P. González Testimony, day 12, p. 45-46, and Exhibit 44 at p. 18; gloves labeled as sterile were stored in an area supposedly reserved for inspection and packaging, without any indication regarding whether or not they were actually sterilized; Cox Testimony, day 1, p. 43; P. González Testimony, day 12, p. 130; gloves labeled as sterile were stored in the rodent-infested warehouse with supposedly inferior gloves, Cox Testimony, day 1, p. 104. Plastic Materials stored hundreds of gloves in plastic garbage bags which were reused, nor did the firm ensure that the labels would be changed on the reused bags. Cox Testimony at day 1, p. 43, 104; day 2, p. 75-76, day 3, p. 33, 34; Exhibit 44 at p. 18; Rosario Testimony, day 9, p. 31. 19. Plastic Materials used a fan in the manufacturing facilityin the area in which the molds were dipped into the liquid latexthat was covered with a thick coat of the same cornstarch dust that flew throughout the manufacturing facility. Cox Testimony, day 1, p. 47-50 and Exhibit 10. 20. Therefore Plastic Materials did not use effective measures to clean the manufacturing facility. Cox Testimony, day 1, p. 39 and Exhibit 9, 10, 12, and 13. 21. Airborne contamination in a glove manufacturing facility may introduce foreign matter into the finished gloves, causing an inclusion and increasing the likelihood of tears or pinholes. Twardochleb Testimony, day 5, p. 76, 77; Nickerson Testimony, day 5, p. 99. 22. At least sixteen different employees manually performed the dipping and drying procedures. P. González Testimony, day 13, p. 125. 23. Plastic Materials did not establish a standard length of time for the glove molds to be dipped into the latex; each employee determined the dipping time for him or herself. Cox Testimony, day 1, p. 33-34; P. González Testimony, day 13, p. 125. 24. During latex glove manufacturing, the dipping time must be controlled in a uniform, standard, and consistent manner to ensure that the finished glove is safe and effective for its intended use. Twardochleb Testimony, day 4, p. 26, 42; Nickerson Testimony, day 5, p. 90, 96, 97, 108. 25. Plastic Materials permitted each employee to decide independently the speed at which the glove mold was withdrawn from the liquid latex. Cox Testimony, day 1, p. 35; P. González Testimony, day 13, p. 123. 26. During latex glove manufacturing, the speed of withdrawing the latex-coated mold from the liquid latex must be controlled in a consistent and uniform manner to ensure that the finished glove is safe and effective for its intended use. Nickerson Testimony, day 5, p. 90, 94, 97. 1282 27. During latex glove manufacturing, the speed of withdrawing the mold from the liquid latex effects the glove thickness and may cause pinholes. Nickerson Testimony, day 5, p. 93-95; P. González Testimony, day 13, p. 124. 28. Plastic Materials permitted each employee to determine the exact drying time for the latex-coated glove molds. Cox Testimony, day 1, p. 36; P. González Testimony, day 13, p. 126. 29. During latex glove manufacturing, the drying time must be controlled in a uniform, standard, and consistent manner, with a calibrated timing instrument, to ensure that the finished glove is safe and effective for its intended use. Twardochleb Testimony, day 4, p. 26, 42; Nickerson Testimony, day 5, p. 90, 95, 96, 97. 30. Plastic Materials did not have a working thermometer in the heat curing oven. Cox Testimony, day 1, jp. 37; P. González Testimony, day 12, p. 76. 31. During latex glove manufacturing, the heat curing temperature must be controlled at a consistent and uniform level with a thermometer to ensure that the gloves are safe and effective for their intended purposes. Twardochleb Testimony, day 4, p. 26, 42; Nickerson Testimony, day 5, p. 90, 95-97. 32. During latex glove manufacturing, excessive heat during curing will cause the gloves to be brittle, while a temperature that is too low will cause the gloves to be sticky. Nickerson Testimony, day 5, p. 95. 33. Plastic Materials did not monitor the viscosity (thickness) of the liquid latex in a consistent, standard, and uniform manner. Twardochleb Testimony, day 4, p. 42, 63; Nickerson Testimony, day -, p. 92; see also P. González Testimony, day 13, p. 123-125. 34. During latex glove manufacturing, latex viscosity must be monitored with a special instrument called a viscometer, to ensure that the latex is of the proper thickness to produce a glove that is safe and effective for its intended purposes. Twardochleb Testimony, day 4, p. 63; Nickerson Testimony, day 5, p. 90, 93. 35. During latex glove manufacturing, the viscosity of the liquid latex changes when extra latex or other material is added or if the temperature varies. Nickerson Testimony, day 5, p. 93; P. González Testimony, day 13, p. 124-126. 36. Plastic Materials did not establish a standard dipping time, withdrawal rate, heat curing temperature, or latex viscosity in the device master record (DMR), for each employee to follow, and provided only a general range for the drying time. Cox Testimony, day 2, p. 83, 85; P. González Testimony, day 13 at p. 125-127. 37. Plastic Materials did not record the dipping time, drying time, withdrawal rate, heat curing temperature, or latex viscosity in the device history record (DHR) for each lot of gloves produced. Cox Testimony, day 3, p. 54; P. González Testimony, day 13, p. 125-127. 38. The device matter record (DMR) pertaining to latex glove manufacturing must include dipping time, drying time, withdrawal rate, heat curing temperature, and latex viscosity, to ensure that each employee performs such procedures in a uniform manner for each lot of gloves, and that, therefore each lot of gloves is safe and effective for its intended use. Twardochleb Testimony, day 4, p. 29, 43; Nickerson Testimony, day 5, p. 90, 108. 39. The device history record (DHR) pertaining to latex glove manufacturing, must include the dipping time, drying time, withdrawal rate, the heat curing temperature, and latex viscosity, with respect to each lot of gloves to establish that each lot of gloves was produced in accordance with the standard set forth in a firm's DMR and to ensure that each lot of gloves is safe and effective for its intended use. Nickerson Testimony, day 5, p. 90, 108; Twardochleb Testimony, day 4, p. 29, 43, 64. 40. Plastic Materials received complaints about the quality of its gloves including complaints about hardening, a tendency to tear, a tendency to rip and develop holes, poor sizing, and inadequate powder. P. González Testimony, day 13, p. 140-141. 1283 41. Plastic Materials' employee training consisted of on the job training. P. González Testimony, day 11, p. 84; Rosario testimony, day 9, p. 26, 28; Testimony of Maria Esther González (M. González Testimony), day 9, p. 60. 42. Plastic Materials' employees wore jewelry, makeup, and nail polish while handling the gloves. Exhibits N7 and O7 (photos). 43. Jewelry could puncture the gloves during handling, Nickerson Testimony, day 5, p. 102, long fingernails could damage the gloves and nail polish and lipstick could rub off onto the product. M. González Testimony, day 9, p. 61, 62, 64; see also Rosario Testimony 33. 44. A predetermined, standard volume of air must be used to inflate a latex glove during leak testing, and the glove must remain inflated for a specific length of time, otherwise the results are inconclusive and meaningless. Nickerson Testimony, day 5, p. 99-100; Twardochleb Testimony, day 4, p. 33-35, 39-40; see also Kilham Testimony, day 10, p. 66. 45. Plastic Materials did not establish a standard or control the volume of air that the employees introduced into the gloves when performing an air inflation (leak) test; each employee decided how much air to use independently. Cox Testimony, day 1, p. 42; M. González Testimony, day 9, p. 66; Kilham Testimony, day 10, p. 66. 46. At least 35-40 different Plastic Materials' employees performed the initial, "100%", air inflation testing on the gloves. Rosario Testimony, day 9, p. 7. 47. Some of Plastic Materials' employees inflated the gloves orally. Cox Testimony, day 1, p. 40-41. 48. The Plastic Materials' employees inflated the gloves for five to seven seconds during the "final" air inflation testing. M. González Testimony, day 9, p. 66-67. 49. Plastic Materials adopted a leak testing method developed by the American Society for Testing and Materials ("ASTM") in its device master record (DMR). Cox Testimony, day 3, p. 63-66; Twardochleb Testimony, day 5, p. 73; Exhibit 44 at p. 30; P. González Testimony, day 11, p. 85; Exhibit 16. 50. The ASTM method consists of three separate tests: 1) physical requirements, (tensile strength and ultimate elongation), which involves cutting a piece of glove and testing it in a machine for strength; 2) physical dimensions test (length, width, and thickness of the glove); 3) leak testing, in which an exam glove is tested in a water tight test, while the surgeon's glove is inflated to a known amount of pressure and immersed in water while the tester checks for air bubbles. Twardochleb Testimony, day 4, p. 24, 66 through 72; Kilham Testimony, day 10, p. 35, 39, 62 and Exhibit A6. 51. Plastic Materials did not perform physical requirements testing. Cox Testimony, day 1, p. 41-42; Twardochleb Testimony, day 4, p. 66, 68, 70, 71, 72; Rosario Testimony, day 9, p. 11; M. González Testimony, day 9, p. 42, Exhibit J3. 52. Plastic Materials did not perform the inflation leak testing according to the ASTM method, because it did not perform the water immersion or water leak test at all, and it did not inflate the gloves with a known, standard amount of air for a specified period of time. Twardochleb Testimony, day 4, p. 42, 67 through 70, day 5, p. 73, 74; Cox Testimony, day 1, p. 42; P. González Testimony, day 12, p. 7, 144; M. Rosario Testimony, day 9, p. 10-11; M. González Testimony, day 9, p. 42, 45, 66. 53. In March 1990, Plastic Materials did not have a current written audit plan or audit reports. P. González Testimony, day 12, p. 42, day 13, p. 141; Exhibit 44, at p. 17. 54. 21 C.F.R. § 820.20(b) requires that periodic audits be conducted of a device manufacturer or distributor's quality assurance program. The audit procedures as well as the audit results must be in writing. 55. Plastic Materials did not calibrate the compressed air stations that it used for finished product testing. P. González Testimony, day 12, p. 144. 56. 21 C.F.R. § 820.61, requires that all production and quality assurance measurement equipment be routinely calibrated, inspected, 1284 and checked according to written procedures. 57. Finished product testing does not establish compliance with the good manufacturing practice regulations. Twardochleb Testimony, day 4, p. 37; Nickerson Testimony, day 5, p. 101; Kilham Testimony, day 10, p. 66, 67, 68. 58. The good manufacturing practice regulations, 21 C.F.R. § 820, apply to all finished devices. 21 C.F.R. § 820.1(c); Twardochleb Testimony, day 4, p. 33, day 5, p. 73 and 76. 59. Plastic Materials used the same manufacturing process between 1988 and 1990. P. González Testimony, day 12, p. 127. 60. Plastic Materials held packing materials, in-process gloves, finished and packaged gloves, and some bags of cornstarch at the Loíza manufacturing plant. Cox Testimony, day 1, p. 43; Exhibits 16 and 17. 61. Cornstarch is a food for rodents. Brickey Testimony, day 4, p. 14, 15. 62. Packing materials and gloves are the types of materials that rodents seek and use for building nests. Brickey Testimony, day 4, p. 12, 15. 63. Rodents are attracted by open doors and windows, holes in the walls, and food and nesting material. Brickey Testimony, day 4, p. 12, 14, 15. 64. Plastic Materials' Loíza manufacturing plant harbored rodents. Cox Testimony, day 1, p. 53-54; Brickey Testimony, day 4, p. 18, 21; Exhibits 12, 15, 16, and 17. 65. The Luquillo warehouse that Plastic Materials used harbored rodents. Cox Testimony, day 1, p. 77-79; Brickey Testimony, day 4, p. 18, 19, 21; Testimony of Joaquin Palau Soltero (Palau Testimony), day 3, p. 10 through 16; Exhibits 23 through 41 and 47 through 50. 66. The presence of rodents in the manufacturing facility could easily cause the in-process gloves to become contaminated with rodent filth, because rodent hair can mix with the dust and cornstarch in the air and settle in the liquid latex. Brickey Testimony, day 4, p. 21; Nickerson Testimony, day 5, p. 92. 67. Plastic Materials used the Luquillo warehouse to store device components, packaging materials, and finished products. Cox Testimony, day 1, pp. 65-78, 104, 105; Exhibits 22 and 28. 68. The cornstarch that Plastic Materials stored at the Luquillo warehouse was a specific type, used only in manufacturing devices, latex gloves. P. González Testimony, day 11, p. 80. 69. The cornstarch at the Luquillo warehouse contained rodent hair, rodent-gnawed bagging material, and rodent excreta. Palau Testimony, day 3, p. 10 through 16; Exhibits 47, 48, 49, 50; Brickey Testimony, day 4, p. 21; Guadalupe Testimony, day 7, p. 37-41; Ayala Testimony, day 11, p. 16-17. CONCLUSIONS OF LAW 1. STATUTORY AND REGULATORY FRAMEWORK A. Device Definition The Act, 21 U.S.C. § 321(h), defines a device as an instrument, apparatus, implement, machine, contrivance, implant, in vitro reagent, or other similar or related article, including any component, part, or accessory, which is * * * * * (2) intended for use in the * * * * * treatment, or prevention of disease, in man or other animals, * * * * * * which does not achieve its primary intended purposes through chemical action within or on the body of man or other animals and which is not dependent upon being metabolized for the achievement of any of its principal intended purposes. Both surgeons gloves, see 21 C.F.R. § 878.4460, and examination gloves, see 21 C.F.R. § 880.6250, are devices under the Act. Moreover, the glove components, parts, and accessories, are clearly devices as well. 21 U.S.C. § 321(h). See United 1285 States v. 22 Rectangular or Cylindrical Devices, 714 F.Supp. 1159, 1164 (D.Utah 1989) (device includes any "component, part, or accessory"). Whether a product's intended use makes it a device depends, in part, on the manufacturer's objective intent in promoting and selling the product. All of the circumstances surrounding the promotion and sale of the product constitute the "intent". It is not enough for the manufacturer to merely say that he or she did not "intend" to sell a particular product as a device. See 21 C.F.R. § 801.4; United States v. An Article of Device, 731 F.2d 1253, 1256-58 (7th Cir.), cert. denied, 469 U.S. 882, 105 S.Ct. 249, 83 L.Ed.2d 186 (1984). Rather, the actual circumstances surrounding the product's sale, such as the identify of actual customers and their use of the product and labeling claims, determine the "intended" use of the product as a device under the Act. See United States v. 22 Rectangular or Cylindrical Devices, 714 F.Supp. 1159, 1165 (D.Utah 1989). Indeed, when a manufacturer has created a market for a product to be used as a device, he or she cannot avoid the reaches of the Act by stating that the product has a differentand non-regulated use. The Court's have recognized the "carry-over effect" that is created by a manufacturer's original representations about the product. See United States v. Midwest Pharmaceuticals, Inc., 890 F.2d 1004, 1008 (8th Cir.1989) (change in advertising not adequate to counter consumer's expectations regarding misbranded drug); accord United States v. 3 Cartons, More or Less, "No. 26 Formula GM," 132 F.Supp. 569, 574 (S.D.Cal.1952). B. A Device That is Not Manufactured in Compliance with Good Manufacturing Practice is Adulterated as a Matter of Law 1. Adulteration Under the Act, a device is "deemed" to be adulterated if: the methods used in, or the facilities or controls used for, its manufacture, packing, storage, or installation are not in conformity with applicable requirements under [21 U.S.C. § 360j(f)(1) (the GMP regulations)] 21 U.S.C. § 351(h). Adulterated medical devices are liable to seizure and condemnation at any time, and without proof of interstate commerce. 21 U.S.C. § 334(a)(2)(D). The Act, 21 U.S.C. § 351(h), specifically regulates the device manufacturing process, rather than the end product of that process. Therefore, if the manufacturing process does not conform to the GMP regulations, the devices are adulterated as a matter of law. 21 U.S.C. § 351(h). The GMP provisions of the statute for devices and human drugs[2] and their implementing regulations, are prophylactic measures designed to prevent the distribution of poorly manufactured drugs and devices "by giving the Food and Drug Administration ... additional authority to require that sound methods, facilities, and controls be used in all phases of drug manufacturing and distribution." United States v. Bel-Mar Laboratories, Inc., 284 F.Supp. 875, 881 (E.D.N.Y.1968); see also United States v. An Article of Drug, 484 F.2d 748, 751 (7th Cir.1973). Simply put, the GMP regulations are intended to be preventive, by requiring manufacturers to build quality into their devices, rather than permit a defective device to be distributed and used to treat patients. Congress added the GMP provision for medical devices to the Act in 1976, to improve the quality and reliability of devices and to ensure their integrity from the beginning of manufacture through delivery to the ultimate consumer. Congress noted that, without such authority, FDA would only learn of unsafe and ineffective medical 1286 devices after those products has been distributed to the public. Such after-the-fact regulatory action would offer little or no protection to those members of the public already exposed toor harmed byunsafe or ineffective medical devices. See 122 Cong.Rec. 5, 855-56 (1976) (statement of Rep. Maguire); cf., H.R. 2464, 87th Cong., 2d Sess. 1-2 (1962) (same reasoning applied to the parallel provision of the Act concerning human drugs). 2. A Device that Was Not Manufactured in Compliance with GMP is Adulterated, Even if the Device Does Not Contain Any Actual Defects The government need not establish that the seized devices contain any actual defectsor caused any harmto prove that the seized articles are adulterated. In a recent case, applying the device GMP regulations in a seizure brought under 21 U.S.C. § 334, the Court held that "[in] order to prove a claim of adulteration of a device based upon noncompliance with GMP regulations, the Government need not establish that the device is actually deficient as a result of the GMP violation." United States v. Various Articles of Device ... Proplast II, 800 F.Supp. 499, 502 (S.D.Tex.1992). Courts applying the parallel human drug GMP provisions have invariably found that products manufactured in violation of GMP are adulterated as a matter of law, without any showing of actual defects. See United States v. Dianovin Pharmaceuticals, 342 F.Supp. 724, 728-729 (D.P.R.1972), aff'd, 475 F.2d 100 (1st Cir.), cert. denied, 414 U.S. 830, 94 S.Ct. 60, 38 L.Ed.2d 65 (1973) (drugs not manufactured in conformity with GMPs are adulterated; United States v. Western Serum Co., Inc., 498 F.Supp. 863, 867 (D.Ariz.1980), aff'd, 666 F.2d 335 (9th Cir.1982) ("[t]he Act is concerned with the manner in which a drug is produced as well as its composition and content"); United States v. Lit Drug Co., 333 F.Supp. 990, 998 (D.N.J.1971) (a drug may be pharmaceutically perfect in content but still be regarded as adulterated under the law); United States v. Bel-Mar Laboratories, Inc., 284 F.Supp. 875, 881-883 (E.D.N.Y. 1968) (drug manufactured in violation of GMPs is adulterated, whether or not it is actually deficient). There can be no dispute that the case law construing "good manufacturing practice" in the context of drugs applies equally to medical devices. The Supreme Court has recognized that there is no difference between drugs and devices with respect to a regulated entity's obligation to comply with the FDC Act: Thus, it is clear that two parallel definitions [drug and device] were provided for semantic reasons only; for the purposes of the Act, the two definitions had the same effect of subjecting both drugs and devices to the adulteration and misbranding provisions. United States v. An Article of Drug, 394 U.S. 784, 797, 89 S.Ct. 1410, 1417, 22 L.Ed.2d 726 (1969). In light of the foregoing, there can be no serious question regarding the legal basis upon which the government seeks to condemn the seized articles. C. Devices That Contain Filth Are Adulterated as a Matter of Law Under the Act, 21 U.S.C. § 351(a)(1), a device is deemed to be adulterated "if it consists in whole or in part of any filthy, putrid, or decomposed substance." This section of the Act forbids any and all filth, thus it is clear that the government need only prove the presence of filth. See United States v. Cassaro, 443 F.2d 153, 157 (1st Cir.1971); United States v. 484 Bags, More or Less, 423 F.2d 839, 841 (5th Cir.1970) (both cases applying the comparable section of the Act prohibiting filth in foods21 U.S.C. § 342(a)(3)). D. Devices Held Under Insanitary Conditions Are Adulterated as a Matter of Law Under the Act, 21 U.S.C. § 351(a)(2)(A), a device is deemed to be adulterated "if it has been prepared, 1287 packed, or held under insanitary conditions whereby it may have been contaminated with filth." This section of the Act regulates the device's manufacturing and storage conditions and environment; the government is not required to prove any actual contamination of the product to establish adulteration. See United States v. Wiesenfeld Warehouse Co., 376 U.S. 86, 90, 84 S.Ct. 559, 562, 11 L.Ed.2d 536 (1964); United States v. Cassaro, Inc., 443 F.2d 153, 157 (both cases applying the comparable statutory section regulating food storage conditions. 21 U.S.C. § 342(a)(4)). The government need only prove that there is a reasonable expectation that the articles could become contaminated with filth. See Berger v. United States, 200 F.2d 818, 821 (8th Cir.1952); United States v. Cassaro, Inc., 443 F.2d at 157; United States v. Gel Spice Co., Inc., 601 F.Supp. 1205, 1211 (E.D.N.Y.1984), aff'd, 773 F.2d 427 (2d Cir. 1985), cert. denied, 474 U.S. 1060, 106 S.Ct. 804, 88 L.Ed.2d 780 (1986); United States v. King's Trading, Inc., 724 F.2d 631, 632 (8th Cir.1983). II. SPECIFIC REGULATORY VIOLATIONS A. The GMP Regulations Are Binding and Have the Force and Effect of Law The GMP[3] regulations for medical devices, 21 C.F.R. § 820, which were promulgated pursuant to 21 U.S.C. § 360j(f)(1) and FDA's general rulemaking authority, 21 U.S.C. § 371(a), are binding and have the force and effect of law. See, e.g., National Ass'n of Pharmaceutical Manufacturers v. FDA, 637 F.2d 877, 879-881, 889 (2d Cir.1981) ("Reading [§ 371(a)] ... one would have little difficulty in concluding that the words suffice to empower the ... FDA ... to issue regulations ... having the force of law") (case upholding drug GMP regulations); see also, Weinberger v. Hynson, Westcott and Dunning, Inc., 412 U.S. 609, 618-622, 93 S.Ct. 2469, 2477-2479, 37 L.Ed.2d 207 (1973). A broad-based challenge to the content of the GMP regulations for drugs has been rejected. National Ass'n of Pharmaceutical Manufacturers v. Dep't Health and Human Services, 586 F.Supp. 740 (S.D.N.Y.1984). The constitutionality of the phrase "good manufacturing practice" and the parallel GMP regulations for drugs is settled. See, e.g., An Article of Drug, 484 F.2d at 751; Bel-Mar Laboratories, Inc., 284 F.Supp. at 880-883. B. Full Compliance with the GMP Regulations is Required as a Matter of Law A device is adulterated, as a matter of law, if there is a single instance of failing to conform to the GMP regulations. See 21 C.F.R. § 820.1(a). Courts have accorded deference to the FDA's determination that a firm is in violation of the GMP regulations. Indeed, the Proplast II court held that "whether a manufacturer is, in the Court's estimation, in substantial compliance with GMP regulations is immaterial if the FDA, in its discretion, determines that full compliance with the regulation is necessary." Proplast II, supra, slip op. at 6. Likewise, in United States v. Western Serum Co., Inc., 498 F.Supp. 863 (D.Ariz. 1980), aff'd, 666 F.2d 335 (9th Cir.1982), although the court found only four GMP violations, it nevertheless held: Whether full compliance with the GMPs is either possible or necessary is an issue that is not within this Court's competence. Rather, this is a matter properly left to determination by the FDA. Western Serum, 498 F.Supp. at 867-868. Therefore, so long as the government has proved a single violation of the GMP regulations, the seized articles are adulterated as a matter of law. Moreover, the law does not permit a device manufacturer to weigh the relative importance of the various GMP regulations. Congress entrusted these decisions to the FDA. See National Association of Pharmaceutical Manufacturers, 637 F.2d 1288 at 889. Were this Court to accept claimant's approach to GMP complianceaffording complete and absolute discretion to the manufacturer regarding the degree and method of implementationthe regulations would not be binding, and every manufacturer would be able to unilaterally pick an choose which regulations it could conveniently and economically obey, and which it could ignore. Such an interpretation would completely undermine the purpose of the GMP regulations, because every manufacturer could, in effect, establish its own standard for safe and effective devices. The final rule establishing the device GMP regulations also makes clear that complete control over all manufacturing processes is a fundamental principle of the GMP.[4] It states that the: GMP regulation has been developed in accordance with basic principles of quality assurance. (See, for example, Juran, Quality Control Handbook, 3d ed., ... (1974)). These principles have as their goal the production of articles that are fit for their intended uses, and may be stated as follows: (1) Quality, safety, and effectiveness must be designed and built into the product; (2) quality cannot be inspected or tested into the finished product; and (3) each step of the manufacturing process must be controlled to maximize the probability that the finished product meets all quality and design specifications. 43 Fed.Reg. 31,509 (1978) (emphasis added). Moreover, FDA's interpretation of the extent of implementation required under its GMP regulations is entitled to substantial deference. As the Supreme Court has held: It is well established "that an agency's construction of its own regulations is entitled to substantial deference." In situations in which "the meaning of [regulatory] language is not free from doubt" the reviewing court should give effect to the agency's interpretation so long as it is "reasonable", that is, so long as the interpretation "sensibly conforms to the purpose and wording of the regulations." Because applying an agency's regulation to complex or changing circumstances calls upon the agency's unique expertise and policy making prerogatives, we presume that the power authoritatively to interpret its own regulations is a component of the agency's delegated lawmaking powers. Martin v. Occupational Safety and Health Review Comm., ___ U.S. ___, ___ _ ___, 111 S.Ct. 1171, 1175-76, 113 L.Ed.2d 117 (1991) (citations omitted) (emphasis added). "When the construction of an administrative regulation rather than a statute is in issue, deference is even more clearly in order." Udall v. Tallman, 380 U.S. 1, 16, 85 S.Ct. 792, 801, 13 L.Ed.2d 616 (1965). An agency's interpretation of its regulations is controlling "unless it is plainly erroneous or inconsistent with the regulation." Tallman, 380 U.S. at 16-17, 85 S.Ct. at 801-802; see also, Robertson v. Methow Valley Citizens Council, 490 U.S. 332, 358, 109 S.Ct. 1835, 1850, 104 L.Ed.2d 351 (1989) (and cases cited therein). Furthermore, absolute compliance with the GMP regulations is required, regardless of any cost or hardship alleged by the claimant, and without respect to the manual nature of claimant's operation. As the Supreme Court has clearly and repeatedly recognized in cases arising under the Act, the difficulties or hardships of a manufacturer who voluntarily enters a regulated industry cannot outweigh the interests of the public in protection from products that violate the law: The requirements of foresight and vigilance imposed on responsible corporate agents are beyond question demanding, and perhaps onerous, but they are no more stringent that the public has a right to expect of those who voluntarily assume positions of authority in business enterprises whose services and products effect the health and well-being of the public. United States v. Park, 421 U.S. 658, 672, 95 S.Ct. 1903, 1911, 44 L.Ed.2d 489 (1975). See also, Ewing v. Mytinger & 1289 Casselberry, Inc., 339 U.S. 594, 601, 70 S.Ct. 870, 874, 94 L.Ed. 1088 (1950) (potential injury to a regulated business because of seizures under the Act cannot outweigh the public interest in being protected from defective products); United States v. Dotterweich, 320 U.S. 277, 285, 64 S.Ct. 134, 138, 88 L.Ed. 48 (1943) (in balancing hardships under the Act, the interests of a regulated business cannot outweigh those of "the innocent public who are wholly helpless"). A manufacturer has no right to conduct a business regulated by the Act in an unlawful manner. United States v. Diapulse Corporation of America, 457 F.2d 25, 29 (2d Cir.1972); United States v. Ellis Research Laboratories, Inc., 300 F.2d 550, 554 (7th Cir.), cert. denied, 370 U.S. 918, 82 S.Ct. 1558, 8 L.Ed.2d 499 (1962). The Act: does not provide that parties shall avoid doing such things if it is possible, it provides that it shall not be done at all. A party who cannot prepare proper * * products under [proper] conditions must cease putting such products into interstate commerce. United States v. Lazere, 56 F.Supp. 730, 733 (N.D.Iowa 1944). C. GMP Violations 1. Environmental Control Requirements Title 21 C.F.R. §§ 820.40 and 820.46 state: Buildings in which manufacturing, assembling, packaging, packing, holding, testing, or labeling operations are conducted shall be of suitable design and contain sufficient space to facilitate adequate cleaning, maintenance, and other necessary operations. The facilities shall provide adequate space designed to prevent mixups and to assure orderly handling of the following: Incoming components; rejected or obsolete components; in-process components; finished devices; labeling; devices that have been reprocessed, reworked, or repaired; equipment; molds, patterns, tools, records, drawings, blueprints; testing and laboratory operations; and quarantined products. 21 C.F.R. § 820.40. Where environmental conditions at the manufacturing site could have an adverse effect on a device's fitness for use, these environmental conditions shall be controlled to prevent contamination of the device and to provide proper conditions for each of the operations performed pursuant to § 820.40. Conditions to be considered for control are lighting, ventilation, temperature, humidity, air pressure, filtration, airborne contamination, and other contamination. Any environmental control system shall be periodically inspected to verify that the system is properly functioning. Such inspections shall be documented. 21 C.F.R. § 820.46. The evidence at trial showed that Plastic Materials did not have adequate controls in its buildings. The government presented uncontroverted evidence that the firm left the manufacturing facility doors and unscreened windows open during the manufacturing process and that cornstarch powder blew throughout the manufacturing area. Cox Testimony, day 1, p. 30, and Exhibit 8. Likewise the warehouse that the firm used had countless openings, holes, and gaps in the doors and walls. Cox Testimony, day 1, p. 67, 72; Exhibits 21 and 22. Claimant did not even attempt to dispute the government's evidence establishing that the warehouse harbored rodents. Claimant could not present any evidence to contradict the testimony of the government's experts, Mr. Brickey and Mr. Nickerson, that: the conditions in the manufacturing facility attracted rodents; the manufacturing facility did harbor rodents; and rodent hairs and filth could easily contaminate the in-process gloves. Brickey Testimony, day 4, p. 12, 14-21; Nickerson Testimony, day 5, p. 91, 92, 99. Plaintiff's witness, Mr. Brickey, a well-recognized and widely-respected expert in identifying filth, unequivocally testified that rodents were present in both of Plastic Materials' buildings. Brickey Testimony, day 4, p. 18-21. See United States v. King's Trading, Inc., 724 F.2d 631, 633 (8th Cir.1983) (Mr. Brickey's Testimony interpreting the data collected by FDA investigators 1290 and his conclusion that a warehouse was rodent infested recognized by the court). Significantly, although claimant presented Dr. Kilham as an expert in filth analysis, he did not testify that either of the firm's buildings was free of rodent contamination. Claimant offered the theory, through the testimony of Dr. Kilham, that sterilization would somehow remedy any filth in the gloves. However, such an argument does not address the government's allegation because sterilization would not remove any foreign matter that the gloves might contain. Moreover, claimant's own evidence undermines its argument, for claimant did not sterilize the dental examination gloves. P. González Testimony, day 12, p. 54. Likewise, the government presented uncontroverted evidence that the rodent-infested warehouse contained boxes of finished, packaged, gloves that were clearly labeled as sterile surgeon's gloves and dental examination gloves. Cox Testimony, day 1, p. 104. In addition, the claimant provided further evidence that the firm failed to organize its buildings in a manner sufficient to prevent mix-ups. Mr. González admitted that he opened a carton of gloves during Mr. Cox's visit, in which the lot number on the carton did not match the lot number on the gloves. Although Claimant attempts to minimize this violation as "just a mistake," P. González Testimony, day 12, p. 45-46, the fact remains that the GMP regulations are intended to establish controls to prevent exactly this type of "mistake." The government established other violations of 21 C.F.R. § 820.40. Mr. Cox testified that the labeling on the plastic garbage-type bagswhich claimant used to store gloveswas unreliable because some bags were not labeled at all while others contained inconsistent types of information. Cox Testimony, day 1, p. 43, 104, day 2, p. 75-76, day 3, p. 33, 34. Claimant's witness, Ms. Rosario, could only theorize that some otherabsent and unidentifiedemployee was responsible for placing the correct labels on the bags and changing those labels when the bags were reused. Rosario Testimony, day 9, p. 31. 2. Manufacturing Process Control Requirements 21 C.F.R. §§ 820.100 requires that: Written manufacturing specifications and processing procedures shall be established, implemented, and controlled to assure that the device conforms to its original design or any approved changes in that design. The government presented uncontroverted evidence that claimant did not control the steps of its manufacturing process. Specifically, claimant did not establish a standard length of time for the glove molds to be dipped into the liquid latex ("dipping time"); a standard speed for withdrawing the molds from the latex ("withdrawal rate"); a standard time or temperature for the gloves to spend in the various ovens ("drying time" and "drying temperature"); or a standard for the thickness ("viscosity") of the liquid latex. Cox Testimony, day 1, p. 33-37. Each of these establish a separate GMP violation. In fact, claimant freely admits to each of these deficiencies. P. González Testimony, day 13, p. 123-126. Claimant states that each of the manufacturing processes and procedures discussed above was subject to the discretion of the individual employee. Such a system could hardly establish control over the process. At least sixteen employees performed these processes and procedures, resulting in at least sixteen varying interpretations for each step. P. González Testimony, day 13, p. 125. The government's experts, Mr. Twardochleb and Mr. Nickerson, each testified that Plastic Materials' manufacturing processes and procedures were unacceptable and incapable of ensuring that the finished gloves would be safe and effective when used for their intended purpose. Twardochleb Testimony, day 4, p. 26, 42, 63. Nickerson Testimony, day 5, p. 90-97. Mr. Nickerson also testified that the failure to regulate and control the steps of the manufacturing processes and procedures could result in gloves that were brittle, sticky, 1291 and prone to holes and tears. Nickerson Testimony, day 5, p. 93-95. Not surprisingly, claimant received complaints from the Department of Defense that its gloves tore easily, and tended to harden and develop rips and holes. P. González Testimony, day 13, p. 140-141. Claimant produced no expert testimony to dispute that of the government's experts. Instead, claimant relied on the testimony of its president, Mr. González, who merely offered his own opinion that he disagreed with plaintiff's experts. Moreover, claimant persistently argued that, because the GMP regulations afford some discretion to the device manufacturer in their implementation, that whatever the manufacturer decided to do including the failure to implement any controls at all could not be found inadequate by the FDA. This argument ignores the clear language of those regulations, which state that the manufacturer must establish a level of control sufficient to ensure a safe and effective device. See 21 C.F.R. § 820.1; see also 43 Fed.Reg. 31,508; 31,526, (1978). ("The decisions a manufacturer makes to tailor specific manufacturing needs to quality assurance will be carefully evaluated by FDA. The industry should understand, however, that this regulation has the force of law, and that violation of its provisions are a basis for seizure, injunction, and for prosecution"). The government proved through the testimony of the experts, that claimant did not establish or maintain a level of control sufficient to ensure that its gloves were safe and effective when used for their intended purpose. 3. Requirements to Monitor Employee Handling of Devices Title 21 C.F.R. § 820.25 provides in pertinent part: Each manufacturer shall have sufficient personnel with the necessary education, background, training, and experience to assure that all operations are correctly performed.... Personnel in contact with a device or its environment shall be clean, healthy, and suitably attired where lack of cleanliness, good health, or suitable attire could adversely affect the device. Plastic Materials' employees handled the gloves while wearing makeup, long fingernails, nail polish, and jewelry. Claimant's Exhibits N7 and O7. Mr. Nickerson testified as did claimant's witness, Ms. González that such practices could damage the gloves and were unacceptable. Nickerson Testimony, day 5, p. 102; M. González Testimony, day 9, p. 61-64. Indeed, Ms. González went to great lengths to explain that the firm did not permit employees to have long fingernails or to wear makeup, nail polish, or jewelry while handling the gloves. M. González Testimony, day 9, p. 61-64. Ms. González' explanation of the reason for permitting the employees to wear clear nail polish, while prohibiting dark polish and lipstick, provides yet another example of the firm's complete lack of understanding regarding the most basic GMP principles. Ms. González testified that nail polish was prohibited, not because it would contaminate the gloves or glove packaging, but because such contamination would be visible. This witness, although presented by claimant as its quality control supervisor, in effect testified that defects only exist if they can be seen. Yet, unseen defects are exactly the type of adulteration that the GMP regulations were enacted to prevent. See H.R. 2464, 87th Cong., 2d Sess. 2 (1962); 122 Cong.Rec. 5,855-56 (1976). 4. Compilation and Maintenance of Records Requirements Title 21 C.F.R. §§ 820.180, 820.181, and 820.184 set forth the general requirements for maintenance of records, a device master record and a device history record. The government proved that the claimant failed to adequately maintain two types of records: the device master record (DMR), which must contain the standard specifications for each and every step in the manufacturing process occasionally called the "recipe" and the device history record (DHR), which must document the manner in which each manufacturing process and 1292 procedure was performed for every lot of the gloves. Plaintiff proved that claimant's DMR failed to include significant information such as the dipping time, drying time and exact temperature, withdrawal rate, and latex viscosity. Nor did the firm record this information in the DHR for each lot of gloves produced. Cox Testimony, day 2, p. 83-85, day 3, p. 54; P. González Testimony, day 13, p. 125-127. The government's experts, Mr. Twardochleb and Mr. Nickerson, each testified that, because such information is not recorded in the DMR and DHR, claimant cannot ensure that any of its gloves are safe and effective when used for their intended purpose. Twardochleb Testimony, day 4, p. 29, 43, 64; Nickerson Testimony, day 5, p. 90, 108. Claimant attempted to blur the issue by producing some records, and excerpts of documents that it called its DMR and DHR. The government did not allege, however, that claimant did not have any records at all. Rather, as plaintiff's witnesses testified, the contents of such documents are inadequate and constitute the violation. A manufacturer simply cannot fulfill its obligation to maintain a DMR and DHR by labeling pieces of paper with those titles and submitting only some of the essential information. See, e.g., claimant's exhibits, H6, I6, and K6. Claimant's exhibits do not contain the dipping time, withdrawal rate, heat curing time and temperature, or latex viscosity. Claimant admitted that it did not maintain such records. P. González Testimony, day 13, p. 125-127. 5. Finished Device Testing Requirement 21 C.F.R. § 820.160 states: There shall be written procedures for finished device inspection to assure that device specifications are met. Prior to release for distribution, each production run, lot or batch shall be checked and, where necessary, tested for conformance with device specifications. Where practical, a device shall be selected from a production run, lot or batch and tested under simulated use conditions. Sampling plans for checking, testing, and release of a device shall be based on an acceptable statistical rationale. Finished devices shall be held in quarantine or otherwise adequately controlled until released. A persistent theme that claimant presented throughout the trial was that, because it "tested" the finished devices, manufacturing controls were irrelevant. Yet, both of the government's experts, Mr. Twardochleb and Mr. Nickerson, as well as claimant's own expert, Dr. Kilham, testified that finished product testing will not establish compliance with the GMP regulations. Twardochleb Testimony, day 4, p. 37; Nickerson Testimony, day 5, p. 101; Kilham Testimony, day 10, p. 66, 67, and 68. The violations that the government established regarding claimant's testing are based on the manner in which such testing was performed; the firm's employees did not adhere to any recognized glove testing standard, including the one that claimant adopted in its own DMR. The failure to conform to standards adopted by a firm in its own DMR constitutes an additional GMP violation under 21 C.F.R. §§ 820.181 and 820.184. Claimant adopted the three-part ASTM test method in its DMR, however, it failed to conduct one part of that method (the physical requirements testing) and did not follow the ASTM standard procedures in conducting the second part (the leak testing). Claimant did not dispute that it failed to follow ASTM procedures; the firm's employees did not fill the gloves with a predetermined, standardized volume of air and keep the glove inflated for a prescribed length of time. Cox Testimony, day 1, p. 41-42; Twardochleb Testimony, day 4, p. 42, 66-72, day 5, p. 73, 74; M. González Testimony, day 9, p. 42, Exhibit J3. The firm's employees merely inflated the gloves with some unspecified, unknown amount of air. M. González Testimony, day 9, p. 42. Because of this lack of adherence to recognized, proven standards, the firm's testing cannot be relied upon to ensure that the devices are safe and effective when used for their intended purposes. Nickerson 1293 Testimony, day 5, p. 100; Twardochleb Testimony, day 4, p. 39-40. Plaintiff also presented evidence that Plastic Materials' employees orally inflated the gloves during the firm's "testing." Cox Testimony, day 1, p. 41. Claimant's evidence hardly rebutted that of the government; claimant produced two former employees who had, along with at least 35-40 others, conducted the "100%" and "final" tests. Although these witnesses described inflating the gloves by waving them in the air or by using a machine, and failed to mention oral inflation, the government notes that these were the same witnesses who asserted that the employees in the testing area could not have long fingernails, wear jewelry, makeup or nail polish.[5] Significantly, Mr. González, who gave a most painstaking commentary on FDA investigator Cox's testimony and on Exhibit 44 which contained Mr. Cox's observations failed to deny or even mention this particular testimony and evidence while under oath. See P. González Testimony, day 13, p. 4-10; Exhibit 44 at p. 31. 6. Calibration Requirement 21 C.F.R. § 820.61 states in pertinent part: [E]quipment shall be routinely calibrated, inspected, and checked according to written procedures ... Calibration procedures shall include specific directions and limits for accuracy and precision. There shall be provisions for remedial action when accuracy and precision limits are not met. Calibration shall be performed by personnel having the necessary education, training, background, and experience. Claimant freely admits to this violation, arguing that compliance is unnecessary. P. González Testimony, day 13, p. 144. The plain words of the regulation require that such equipment be calibrated. 7. Audit Requirement Title 21 C.F.R. § 820.20(b) requires that audit procedures be set forth in writing, and that audit results be written as well. Plastic Materials could not produce either written audit procedures or current audit results to the FDA investigator during the February-April 1990 inspection, see Exhibit 44, arguing only that claimant disagreed with the requirement. Given the numerous and broad-ranging GMP violations that the government established, and since any single deviation from GMP will support a finding of adulteration under 21 U.S.C. § 351(h) (see 21 C.F.R. § 820.1(a)), our conclusion is that the defendant articles of device are adulterated within the meaning of the Act, and must be condemned and forfeited. 21 U.S.C. § 334(a)(2)(D). D. Filth Violations As explained in Section I of this Opinion, the Court may condemn all of the seized articles solely because of the GMP violations, pursuant to 21 U.S.C. §§ 351(h) and 334. The filth violations form a separate and independent basis for condemnation for certain of the seized articles. 1. Certain of the seized articles (cornstarch) violate 21 U.S.C. § 351(a)(1) The cornstarch stored at claimant's Luquillo warehouse is adulterated within the meaning of 21 U.S.C. § 351(a)(1), because it consists in whole or in part of rodent filth. Mr. Brickey and Mr. Palau testified that there was absolute evidence photographic and laboratory analysis of rodent filth in the cornstarch. Such filth included rodent hair, rodent urine, and rodent gnawed paper inside the product. Brickey Testimony, day 4, p. 21; Palau Testimony, day 3, p. 10 through 16, Exhibits 47, 48, 49, 50. Claimant did not dispute these findings; rather, it objected that the government did not test each and every 1294 bag of cornstarch. Such an argument is without any basis in the law. The statute prohibits all filth in devices. In light of the absolute statutory prohibition, there is simply no reason for the government to test unbroken bags of the component cornstarch when there is clear, visible contamination of filth in the lot in any amount. See United States v. Cassaro, 443 F.2d 153, 157 (1st Cir.1971); see also A.O. Andersen & Co. v. United States, 284 F. 542 (9th Cir.1922). Claimant attempted to argue that, because there may be regulatory tolerance for certain types of unavoidable contaminants in foods, the same type of allowable tolerance should be permitted for devices. The Act, however, states otherwise: Congress clearly gave the agency the authority to establish tolerance for unavoidable contaminants in foods. See 21 U.S.C. § 346. There is simply no comparable exemption even permittedlet alone implemented and established by the agencyfor devices. See 21 U.S.C. § 351. Nor can it be seriously argued that rodent filth in a device component is unavoidable. 2. Certain articles, (cornstarch and gloves), violate 21 U.S.C. § 351(a)(2)(A) The government also produced uncontroverted evidence that certain articles (cornstarch and gloves) violate 21 U.S.C. § 351(a)(2)(A), because they were held under conditions in which there was a reasonable possibility that they could be contaminated with filth. This section of the statute regulates manufacturing and storage conditions. It does not require any showing of actual product contamination.[6] The government produced the uncontroverted testimony of Mr. Brickey that both of Plastic Materials' buildings, the warehouse and the manufacturing facility, harbored rodents: both buildings had countless routes for rodent access; both contained cornstarch, a foodstuff for rodents; both contained the types of materials that rodents seek to build their nests; and both contained rodent tracks on pallets of product as well as on the floor. Mr. Brickey testified that such evidence conclusively established the presence of rodents in both buildings. Brickey Testimony, day 4, p. 12-15, 18, 19, 21; Exhibits 14, 15, 16, 17, 23-41, 50. There can be no serious doubts about his expertise in making such determinations. See United States v. King's Trading, 724 F.2d 631, 633 (8th Cir.1983). In addition, the manufacturing facility had cornstarch dust blowing throughout the area in which the gloves were manufactured. Cox Testimony, day 1, p. 31, 35, 38, 39, and Exhibits 9-13. Furthermore, claimant's attempt to argue that the rodents were not present during manufacturing is immaterial, for the storage conditions are regulated under this section of the statute, and the gloves and cornstarch held under such conditions were subject to rodent contamination whether manufacturing was ongoing or not. See Cassaro, 443 F.2d at 157; Wiesenfeld Warehouse Co. v. United States, 376 U.S. 86, 87, 90, 84 S.Ct. 559, 562, 11 L.Ed.2d 536 (1964); Berger v. United States, 200 F.2d 818, 823 (8th Cir.1952) (existence of insanitary conditions can be inferred back to date prior to FDA inspection); United States v. 44 Cases, 101 F.Supp. 658 (E.D.Ill.1951) (insanitary conditions presumed to exist prior to FDA inspection). III. INTENDED USE REQUIREMENT Claimant has repeatedly argued that certain of the seized articles, the cornstarch and gloves in the warehouse, are not devices because claimant did not intend to use them as devices. Claimant misinterprets the concept of "intended use" under the Act, for the manufacturer's intent regarding a product is determined by the objective intent, that is, by all of the facts and circumstances surrounding the manufacture, distribution, and actual use of the product. United States v. An Article, Consist. of 216 Carton, Bot., 409 F.2d 734, 739 (2d Cir.1969) (intent may be inferred from product's "label, accompanying labeling, promotional material, advertising, 1295 and any other relevant source"). The manufacturer's subjective intent is not dispositive. See United States v. 25 Cases, More or Less, 942 F.2d 1179, 1182 (7th Cir.1991) (FDA's interpretation of the "device" definition is given deference in a seizure action); United States v. Toftness Radiation Detector, 731 F.2d 1253, 1256 (7th Cir.), cert. denied, 469 U.S. 882, 105 S.Ct. 249, 83 L.Ed.2d 186 (1984); United States v. 22 Rectangular or Cylindrical Devices, 714 F.Supp. 1159, 1165 (D.Utah 1989) (objective, not subjective, intent controls device definition). The circumstances surrounding the manufacture, distribution, and actual use of Plastic Material's gloves present overwhelming evidence that claimant's gloves are intended for use as and therefore are devices within the meaning of the Act. 21 U.S.C. § 321(h). The evidence presented at trial established that Plastic Materials had a single customer the United States Department of Defense. P. González Testimony, day 13, p. 120-121; Exhibits Y2, 2, A3, and T7. The Department of Defense purchased only surgeon's and dental examination gloves from Plastic Materials. Exhibits Y2, Z2, A3, and T7; P. González Testimony, day 13, p. 121. The only labeling and packaging material in evidence is for surgeon's and dental examination gloves. Exhibits 4 and 5 (labels). The only evidence of any sales of Plastic Material's gloves are sales to the Department of Defense for latex surgeon's and dental examination gloves. See Claimant's Exhibits 42, Z2, A3, and T7. Indeed, the cornstarch itself is a special type of cornstarch used only to make devices. P. González Testimony, day 11, p. 80. Claimant attempts to argue that the gloves in its warehouse were "seconds" and "thirds". Even if true, this would not mean that such gloves are not devices, rather, such gloves are defective devices. Claimant's argument is further undercut by the government's uncontroverted evidence that claimant stored packaged, sterile surgeons gloves and dental examination gloves in the warehouse as well. Cox Testimony, day 1, p. 104-105. Finally, the fact that the firm had stored the gloves and rodent-infested cornstarch instead of disposing of such items, strongly undermines claimant's argument that it did not intend to use the gloves as devices. Mr. González' unsupported statements to the FDA investigators cannot counter the weight of such evidence. See United States v. Storage Spaces Designated No.'s 8 and 49, 777 F.2d 1363, 1366 n. 5 (9th Cir.1985), cert. denied, 479 U.S. 1086, 107 S.Ct. 1291, 94 L.Ed.2d 148 (1987) ("self-serving labels cannot be allowed to mask the vendor's true intent as indicated by the overall circumstances"). Furthermore, the claimant of a product regulated by FDA, such as Plastic Materials, cannot ignore the actual intended use of a product, as set forth above, and rely on an individual's subjective intent, to avoid the reach of the law. See Nutrilab, Inc. v. Schweiker, 713 F.2d 335, 337 (7th Cir.1983) ("manufacturer cannot avoid the reach of the FDA by claiming that a product which looks like a food and smells like a food is not a food because it was not intended for consumption," citing, United States v. Technical Egg Prods., Inc., 171 F.Supp. 326, 328 (N.D.Ga.1959)). See also, National Nutritional Foods Assoc. v. Mathews, 557 F.2d 325, 333 (2d Cir.1977). IV. ALL OF THE SEIZED ARTICLES ARE SUBJECT TO SEIZURE Claimant has also argued that, because plaintiff could not provide the lot numbers of the gloves seized, it could not establish that the gloves were manufactured in violation of the GMP regulations. This argument must fail for several reasons. First, Mr. González admitted that Plastic Materials used the same manufacturing process from 1988 to 1990this testimony establishes that the lack of lot numbers is irrelevant, and that if any gloves were manufactured during the period between 1988 and 1990, all gloves manufactured during that period were manufactured in violation of the GMP regulations. P. González Testimony, day 13, p. 127. Claimant did not establish that it sold or otherwise disposed of any gloves between the date of the FDA inspection, in February 1296 April 1990, and the seizure in June of 1990. Second, the government's evidence established that the labels on the bags of gloves, when present at all, could not be relied upon. Indeed, Mr. González admitted that he opened a carton of gloves while with FDA investigator Cox, in which the lot numbers on the carton differed from those on the gloves. P. González Testimony, day 12, p. 45-46; Exhibit 44 at p. 18. Third, Mr. Twardochleb testified that, because of the nature of the violations, for example, the lack of screens and lack of adequate documentation in the DHR and DMR, the violations were of an ongoing nature. Twardochleb Testimony, day 5, p. 53 through 56. Fourth, all the gloves were held under insanitary conditions, in violation of 21 U.S.C. § 351(a)(2)(A), and are subject to condemnation under that section of the Act, regardless of their manufacturing date. Plastic Materials presented conflicting evidence at trial regarding whether the firm manufactured any gloves after March 3, 1990. Cf., testimony of P. González, day 12, p. 59, and P. González testimony, day 13, p. 118. Even if claimant did resume manufacturing, however, it may be inferred that the violations observed in the FDA inspection continued absent a demonstration by claimant that such violations were corrected. See United States v. Morton-Norwich Products, Inc., 461 F.Supp. 760, 767 (N.D.N.Y.1978); Copanos and Sons, Inc. v. FDA, 854 F.2d 510, 525 (D.C.Cir.1988). Mr. Twardochleb, who routinely reviews device firms' responses to notices of violations by FDA, testified that Plastic Materials did not make any such demonstration. Twardochleb testimony, day 4, p. 4, 10; day 5, p. 44, 72. Claimant repeatedly argued that, based on prior contact with FDA investigators and information present in material provided to the firm by the FDA, it assumed that it was in compliance with the GMP regulations. Such an argument is clearly not a defense to adulteration allegations under the Act. Even if FDA investigators had inspected the firm in the past and failed to note GMP deficiencies, that does not provide a defense in this action.[7] It is wellsettled that due process does not require procedural prerequisites, such as notice of and an opportunity to correct violations or any showing of probable cause, prior to the commencement of an in rem seizure under the Act, 21 U.S.C. § 334. See this Court's Order of August 27, 1991; Ewing v. Mytinger & Casselberry, Inc., 339 U.S. 594, 598, 70 S.Ct. 870, 872, 94 L.Ed. 1088 (1950); United States v. Alcon Laboratories, 636 F.2d 876, 882 (1st Cir.), cert. denied, 451 U.S. 1017, 101 S.Ct. 3005, 69 L.Ed.2d 388 (1981); see also, 43 Fed.Reg. 31,508; 31,526 (1978) ("[t]he industry should understand, however, that this regulation has the force of law, and that violation of its provisions are a basis for seizure, injunction, and for prosecution"). See also Claimant's Exhibit G7, p. 16-9 ("FDA is under no legal obligation to warn firms or individuals that they or their products are in violation of the law before initiating formal regulatory action"); see also United States v. Dotterweich, 320 U.S. 277, 278-279, 64 S.Ct. 134, 135-136, 88 L.Ed. 48 (1943) (even in a criminal prosecution the Act does not require that defendant be given an opportunity to present his views as a prerequisite to prosecution). Claimant does not obtain a waiver to distribute illegal products because the 1297 government has not enforced the law against it previously. See Donovan v. Daniel Marr & Son, Co., 763 F.2d 477, 484 (1st Cir.1985) (failure of agency to issue prior citations for violations of Occupational Safety and Health regulations not a defense to substantive allegations). In fact, should the government find that FDA or its agents failed to enforce the law previously, for whatever reason, the agency has a duty to correct this earlier position. See United States v. 60 28 Capsule Bottles, More or Less, 211 F.Supp. 207, 215 (D.N.J.1962), aff'd, 325 F.2d 513 (3d Cir.1963). It is also clear that one cannot invoke estoppel to avoid the requirements of legislation, such as the Act, which was enacted to protect the public from products that do not comply with the law. See Scott Paper Co. v. Marcalus Manufacturing Co., 326 U.S. 249, 257, 66 S.Ct. 101, 105, 90 L.Ed. 47 (1945); United States v. Article of Drug ... Hormonin, 498 F.Supp. 424, 435-437 (D.N.J.1980), aff'd, 672 F.2d 904 (3d Cir.1981); Bentex Pharmaceuticals, Inc. v. Richardson, 463 F.2d 363, 368 n. 17 (4th Cir.1972), rev'd on other grounds, 412 U.S. 645, 93 S.Ct. 2488, 37 L.Ed.2d 235 (1973); AMP Inc. v. Gardner, 275 F.Supp. 410, 412 n. 1 (S.D.N.Y.1967), aff'd, 389 F.2d 825 (2d Cir.), cert. denied, 393 U.S. 825, 89 S.Ct. 86, 21 L.Ed.2d 95 (1968). To stop the government from enforcing the GMP regulations because it failed to do so earlier would deprive the public of the protection that the law is designed to establish. Claimant is, in effect, asking this Court to enjoin the FDA from enforcing the law. It is beyond dispute that the government may not be enjoined from enforcing the Act; such relief would merely permit illegal conduct to continue to the detriment of the public. See generally, Ewing v. Mytinger & Casselberry, Inc., 339 U.S. 594, 601, 70 S.Ct. 870, 874, 94 L.Ed. 1088 (1950); United States v. Alcon Laboratories, Inc., 636 F.2d 876, 881 (1st Cir.), cert. denied, 451 U.S. 1017, 101 S.Ct. 3005, 69 L.Ed.2d 388 (1981). Finally, claimant has placed great reliance upon material that the FDA provided to it regarding GMP compliance, and construes that information to mean that claimant has complete discretion to implement or ignore the GMP regulations in any manner. Claimant ignores the fact that those publications state that they were provided for information and guidance only and are not to be interpreted as statements of agency policy, Exhibit G7 at p. iv. The GMP regulations, 21 C.F.R. § 820, in contrast, were promulgated by notice-and-comment rulemaking and are binding and have the force and effect of law. Id. at 23-24. Informational materials, such as those relied upon by claimant, are simply not the law, nor do they create any legal obligations or rights. See Office of Personnel Management v. Richmond, 496 U.S. 414, 433, 110 S.Ct. 2465, 2476, 110 L.Ed.2d 387 (1990) (erroneous advice by government employee will not estop government from denying benefits not otherwise permitted by law); Schweiker v. Hansen, 450 U.S. 785, 789-790, 101 S.Ct. 1468, 1471-1472, 67 L.Ed.2d 685 (1981) (claims manual for social security administration employees without legal force and no binding effect on the agency); Kugel v. United States, 947 F.2d 1504, 1507 (D.C.Cir.1991) (intraoffice manuals directing employees in conducting investigations have no legal force); Jacobo v. United States, 853 F.2d 640, 641 (9th Cir.1988) (manual establishing standards is not a regulation and does not have the force of law); Brock v. Cathedral Bluffs Shale Oil, 796 F.2d 533, 538-539 (D.C.Cir.1986) (Department of Labor's enforcement policy and guidelines for independent contractors not binding on the agency); American Mining Congress v. Marshall, 671 F.2d 1251, 1262-1263 (10th Cir.1982) (policy statement provided to mine operators regarding Mine Safety and Health Administration's dust control regulations is not binding, substantive rule). Claimant's argument that it did not receive pre-seizure notice or have an opportunity to correct its violations is not a defense to the charge of adulteration. Claimant's attempt to blur an embargo imposed by the Commonwealth of Puerto Rico with this in rem forfeiture action brought under the Act is likewise without merit, because *1298 any dispute concerning the Commonwealth's embargo is not before this Court. Claimant has also attempted to argue that the warrant in this case is nothing more than a "general warrant" running afoul of the Fourth Amendment, an apparent reference to that portion of the warrant directing the seizure of "all other articles of device...." Claimant's argument is baseless. Courts have recognized that seizures of goods brought under the Act do not violate the Fourth Amendment. United States v. Articles of Drug ... WANS, 526 F.Supp. 703, 706 (D.P.R.1981); United States v. An Article of Food, 477 F.Supp. 1185, 1191-1192 (S.D.N.Y.1979). Moreover, even "an illegal seizure does not immunize the goods from forfeiture." United States v. An Article of Device "Theramatic", 715 F.2d 1339, 1341 (9th Cir.1983), cert. denied sub nom., Cloward v. United States, 465 U.S. 1025, 104 S.Ct. 1281, 79 L.Ed.2d 685 (1984); United States v. "Monkey", 725 F.2d 1007, 1012 (5th Cir. 1984) (impropriety of seizure does not prevent forfeiture where independent untainted evidence establishes probable cause); Martin v. United States, 277 F.2d 785, 786 (5th Cir.1960) (legality of search and seizure cannot be raised in a forfeiture action); United States v. Carey, 272 F.2d 492, 494-495 (5th Cir.1959) ("[t]his Court has held on various occasions that the illegality of a search and seizure does not affect a libel of information for forfeiture"). Seizures brought under the Act are initiated in conformity with the rules of admiralty. 21 U.S.C. § 334(b); Fed.R.Civ. P., Rules for Certain Admiralty and Maritime Claims, Rule C(2) and (3). Rule C(2) requires only that a complaint describe with "reasonable particularity" the property that is the subject of the action. On its face, this rule contemplates a less than exact identification of the articles to be seized. Moreover, reasonableness of a description varies with the circumstances of a case. Obviously, when dealing with fungible goods, such as devices and their components, the inventory of those items may fluctuate. Hence, the rule does not anticipate an exact description of each item to be seized. Both finished latex gloves and the components used in their manufacture are precisely identified in the warrant. When viewed in its entirety, it is clear that the claimant's contention is without merit. V. CONCLUSION The evidence shows that the seized articles are adulterated as alleged in the complaint for forfeiture. Accordingly, the articles must be condemned and forfeited to plaintiff pursuant to 21 U.S.C. § 334, and the Court hereby ORDERS that the articles be DESTROYED pursuant to 21 U.S.C. § 334. Judgment shall be entered accordingly. IT IS SO ORDERED. NOTES [1] "Exhibits" refer to the trial exhibits. [2] A parallel provision which is comparable to the device GMP, provides that a drug that is not manufactured in conformity with current good manufacturing practice is likewise deemed adulterated under 21 U.S.C. § 351(a)(2)(B). The GMP regulations for drugs are set forth at 21 C.F.R. §§ 210 and 211. [3] At trial, the Court took judicial notice of the final rule establishing the GMP regulations, 43 Fed.Reg. 31,508 (1978). [4] 43 Fed.Reg. 31,509 (1978). [5] Claimants own photographic exhibits, O7 and N7, contradict the testimony of Ms. Rosario and Ms. González. Moreover, Ms. González' prohibition on lipstick to prevent staining the gloves obviously anticipated that the gloves would come into contact with the employee's mouths. M. González Testimony, day 9, p. 42. [6] The government's sampling process becomes even more irrelevant with respect to this violation, for the government need not prove any product contamination. [7] The evidence is clear that Plastic Materials had no reason to "assume" that it was in compliance with the GMP regulations. FDA investigator Guadalupe, who visited Plastic Materials in the past, testified that he had not conducted a full GMP inspection at the firm. Guadalupe Testimony, day 7, p. 42. Furthermore, the FDA had notified claimant on a previous occasion that its DMR and DHR were inadequate. P. González Testimony, day 13, p. 130, 134-135. Indeed, Mr. González was obviously aware of the agency's different purposes in visiting the firm, as demonstrated by his response to a question pertaining to the extent of a prior FDA inspection: Q: When was the first time that Mr. Guadalupe went to the plant, that you recall? A: For a shipment, or Q: For a visit, Mr. González, for a visit. A: October 12, 1988. P. González Testimony, day 11, p. 89-90.	{ "pile_set_name": "FreeLaw" }
(2008) Jose SOTO, Petitioner, v. Superintendent James CONWAY, Respondent. No. 06 CV 2979 (RJD). United States District Court, E.D. New York. July 15, 2008. MEMORANDUM & ORDER DEARIE, Chief Judge. Pro se petitioner, Jose Soto, petitions for a writ of habeas corpus pursuant to 28 U.S.C. § 2254. For the reasons stated below, the petition is denied. BACKGROUND The incident which led to petitioner's conviction began on the afternoon of December 10, 2001. Defendant was sitting in a Jeep parked outside a methadone clinic in the Red Hook neighborhood of Brooklyn when he was confronted by George Lopez. When Lopez attempted to grab petitioner's necklace, a struggle ensued. Soon thereafter, William Muniz, who had been robbed by petitioner in a prior incident, joined in the fracas. After Muniz stabbed petitioner several times with a pocket knife, a gun emerged, fell to the ground and discharged. Petitioner then picked up the gun and pursued Muniz. As Muniz hid behind a parked vehicle, petitioner, who was being restrained at the time, yelled in Spanish that he was going to kill Muniz and then shot once over the car toward him. Muniz was hit in the neck and, despite immediate hospitalization, died from the wound several days later. At trial, petitioner's oral, written and videotaped post-arrest statements were admitted in evidence. Petitioner presented a defense of justification. The jury was charged on theories of intentional and depraved indifference murder, as well as two lesser-included offenses and second degree criminal possession of a weapon. Petitioner was acquitted of intentional murder but convicted of depraved indifference murder and the weapons charge. On January 28, 2003, petitioner was sentenced as a persistent violent felony offender to two concurrent terms of twenty-five years to life in prison. On appeal, petitioner argued: (1) that the court should exercise its "interest of justice jurisdiction" to find that there was insufficient evidence for a depraved indifference conviction, where the evidence was consistent only with intentional murder;[1] (2) that petitioner was denied a fair trial due to the introduction of testimony regarding his prior robbery of the deceased; and (3) that his sentencing pursuant to New York's persistent violent felony statute was unconstitutional under the principles announced in Apprendi v. New Jersey, 530 U.S. 466, 120 S.Ct. 2348, 147 L.Ed.2d 435 (2000). After petitioner's appellate brief was filed and after the state had responded, but before the case was calendared, appellate counsel moved to file a supplemental brief to assert an additional claim of ineffectiveness of trial counsel for failure to preserve a sufficiency challenge regarding the depraved indifference murder count. In her motion to amend, appellate counsel cited an intervening Appellate Division decision, People v. Turner, 10 A.D.3d 458, 781 N.Y.S.2d 163 (2004), which found appellate counsel ineffective for not challenging the effectiveness of trial counsel's failure to object to a lesser-included offense on the ground that it was barred by the statute of limitations. The motion to amend was denied and on January 24, 2005, petitioner's conviction was affirmed. The Appellate Division found petitioner's sufficiency claim to be unpreserved and declined to exercise its "interests of justice jurisdiction" to reach the issue. The Court also found that "defendant's remaining claims either are without merit or do not require reversal." People v. Soto, 14 A.D.3d 626, 787 N.Y.S.2d 901 (2005). Leave to appeal to the Court of Appeals was denied on March 9, 2005. Petitioner's conviction became final ninety-days later on June 7, 2005. On that day, petitioner moved for a writ of error coram nobis on the ground that his appellate counsel was ineffective for failing to challenge the effectiveness of trial counsel. In that motion, petitioner acknowledged appellate counsel's unsuccessful attempt to amend her brief and cited correspondence in which counsel explained the difficulty of prevailing on the ineffectiveness of trial counsel claim. By order dated October 3, 2005, the Appellate Division denied the writ on the merits. People v. Soto, 22 A.D.3d 512, 801 N.Y.S.2d 546 (2005). Leave to appeal was denied on January 27, 2006. Petitioner brings this application asserting the same sufficiency and sentencing challenges raised on direct appeal, together with the ineffective assistance of appellate counsel claim asserted in his petition for writ of coram nobis.[2] In his reply to the state's response, petitioner also attempts to raise a new and unexhausted claim of ineffective assistance of appellate counsel for failure to appear at oral argument. DISCUSSION I. Sufficiency of the Evidence The meat of this petition is wrapped around a very contentious bone. Although New York has long recognized the legal concept of depraved indifference murder, see People v. Sanchez, 98 N.Y.2d 373, 395-97, 748 N.Y.S.2d 312, 777 N.E.2d 204 (Rosenblatt J., dissenting) (discussing common law and statutory history of DI murder), the New York Court of Appeals' jurisprudence regarding the appropriate charging circumstances and substantive elements of that crime has undergone significant revision of late. At the time of petitioner's trial, the leading Court of Appeals case on depraved indifference murder was People v. Register, which held that the mental state element of the crime was recklessness, that the actus reus was "conduct creating a grave risk of death," and that "circumstances evincing a depraved indifference to human life" referred to "the factual setting in which the risk creating conduct must occur." 60 N.Y.2d 270, 276, 469 N.Y.S.2d 599, 457 N.E.2d 704 (1983). Petitioner is correct to note that Judge Jasen's dissent in Register "forecast[ ] the problems which the Court of Appeals is now attempting to correct in its recent opinions." Pet. Reply, 7. Those recent opinions include: People v. Hafeez, 100 N.Y.2d 253, 762 N.Y.S.2d 572, 792 N.E.2d 1060 (2003) (finding that depraved indifference murder excludes "quintessentially intentional" homicides targeted at particular victims); People v. Gonzalez, 1 N.Y.3d 464, 775 N.Y.S.2d 224, 807 N.E.2d 273 (2004) (holding that depraved indifference murder conviction was "unsupportable as a matter of law" where defendant "was guilty of intentional shooting or no other"); People v. Payne, 3 N.Y.3d 266, 270, 786 N.Y.S.2d 116, 819 N.E.2d 634 (2004) (reversing conviction and noting that recent cases "have made it clear that depraved indifference murder may not be properly charged in the overwhelming majority of homicides that are prosecuted in New York"); People v. Suarez, 6 N.Y.3d 202, 207, 215, 811 N.Y.S.2d 267, 844 N.E.2d 721 (2005) (holding that depraved indifference murder "properly applies only to a small, and finite, category of cases where the conduct is at least as morally reprehensible as intentional murder" and admitting to "departing] slightly from the Register formulation ... in that we make clear that the additional requirement of depraved indifference has meaning independent of the gravity of the risk"); and People v. Feingold, 7 N.Y.3d 288, 819 N.Y.S.2d 691, 852 N.E.2d 1163 (2006) (explicitly overruling Register and Sanchez and establishing depraved indifference as a mental state element of the crime). Most recently, in Policano v. Herbert ("Policano IV"), the Court of Appeals held, upon certification from the Second Circuit, that: at the time petitioner's conviction became final June 28, 2001 Register controlled the legal sufficiency of evidence needed to establish depraved indifference; that under New York law a one-on-one shooting or knifing can almost never qualify as depraved indifference murder; that only in a few rare circumstances may a defendant be convicted of depraved indifference murder when but a single person is endangered; and that depraved indifference to human life is a culpable mental state. 7 N.Y.3d 588, 825 N.Y.S.2d 678, 859 N.E.2d 484 (2006). Although the Court found that the change in the depraved indifference element of the crime should not be applied retroactively, it declined to identify precisely when between Hafeez and Feingold the law actually passed "the point of no return" and therefore became retroactively inapplicable.[3] This Court's reading of these cases comports generally with Chief Judge Kaye's observation that, "[o]ver the last several years, there have been two distinct threads in our developing depraved indifference murder jurisprudence only one of which effected an actual `change' in settled precedent." Policano IV, 7 N.Y.3d at 605, 825 N.Y.S.2d 678, 859 N.E.2d 484 (2006) (Kaye, J., dissenting). The first thread relates to the improper application of the depraved indifference charge in cases where "evidence of a manifestly intentional killing" exists and, as Judge Kaye notes, was consistently applied in Hafeez, Gonzalez, Payne, and Suarez.[4]Id. Over the course of these opinions, the Court of Appeals repeatedly rebuked prosecutors and lower courts, brightening along the way the line between those instances where depraved indifference murder charges and convictions were and were not appropriate. This exercise culminated with the gatekeeping instruction given in Suarez that "where twin-count indictments are lodged, trial courts should presume that the defendant's conduct falls within only one category of murder and, unless compelling evidence is presented to the contrary, dismiss the count that is least appropriate to the facts." 6 N.Y.3d at 215, 811 N.Y.S.2d 267, 844 N.E.2d 721 (citation omitted). To the extent that these cases represented merely the application of existing New York state law to new factual circumstances, they do not represent a change in the law and therefore may be considered upon collateral review. See Bunkley v. Florida, 538 U.S. 835, 123 S.Ct. 2020, 155 L.Ed.2d 1046 (2003); Fiore v. White, 531 U.S. 225, 121 S.Ct. 712, 148 L.Ed.2d 629 (2001); Policano v. Herbert, 430 F.3d 82, 87 (2d Cir. 2005), withdrawn and superseded, 507 F.3d 111, 117 (2d Cir.2007). The second thread is distinct, but not unrelated. It involves the transformation of the incommodious "depraved indifference" element of depraved indifference murder, which "gradually and perceptibly changed from an objectively determined degree-of-risk standard (the Register formulation) to a mens rea, beginning with our decision in Hafeez in 2003 ... and ending with our decision in Feingold in 2006." Policano IV, 7 N.Y.3d at 602-03, 825 N.Y.S.2d 678, 859 N.E.2d 484 (majority opinion). It was with regard to this second change that the Court of Appeals held in Policano IV that its post-Sanchez case law did not apply retroactively. Id. at 603, 825 N.Y.S.2d 678, 859 N.E.2d 484. Petitioner claims that his conviction for depraved indifference murder "was based on legally insufficient evidence ... where the prosecution's case was consistent only with the theory that appellant intentionally killed the decedent and there was no evidence that appellant acted recklessly." Pet. 3. This challenge, which attacks the propriety of the depraved indifference murder charge, but does not contest the specific charging language related to the "depraved indifference" element of that crime, is similar in nature to the argument raised by the petitioner in Policano. In that case, Judge Gleeson found, taking into consideration the Court of Appeals' then-recent decision in Gonzalez, that the Appellate Division's affirmation of Policano's depraved indifference murder conviction "was an unreasonable application of the principle clearly established by such Supreme Court case law as In re Winship, 397 U.S. 358 [90 S.Ct. 1068, 25 L.Ed.2d 368] (1970), which holds that the government must prove all elements of a crime beyond a reasonable doubt." Policano v. Herbert, No. 02 CV 1462, 2004 WL 1960203, at *9 (E.D.N.Y. Sept. 7, 2004) ("Policano I") (overturning depraved indifference murder conviction where the only reasonable inference from the evidence at trial was that petitioner intended to kill). In its initial affirmation of that holding, the Second Circuit found that Gonzalez and Payne, despite coming down after Policano's conviction became final, "represent not the creation of a new legal principle, but the application of long-settled New York law to new facts. The district court properly used them, as do we, as a means of understanding the applicable law as it existed at the time of Policano's trial and appeal." Policano II, 430 F.3d at 92.[5] But the mandate in Policano II never issued. Instead the Circuit denied the state's motion to rehear the case en banc, Policano v. Herbert, 453 F.3d 79 (2006) ("Policano III"),[6] and certified a set of case-related questions to the Court of Appeals. In response, the Court of Appeals clarified that at the time that Policano's conviction became final, "Register defined New York law, and so this case would have been a close one for the jury to decide," Policano IV, 7 N.Y.3d at 601, 825 N.Y.S.2d 678, 859 N.E.2d 484, and that "on this record the jury was permitted to find him guilty of depraved indifference," id., at 602, 825 N.Y.S.2d 678, 859 N.E.2d 484. Despite the answers provided in Policano IV, the Second Circuit noted in dicta in its reconsideration of the district court's holding that: "We are still not convinced... that the record as we understood it at the time of Policano II included what amounts to evidence that Policano might have acted unintentionally." Policano v. Herbert, 507 F.3d 111, 116 (2d Cir.2007) ("Policano V). Nevertheless, that issue became moot when a re-reading of the record revealed evidence that Policano had testified to having been at a methadone clinic, used "three or four" bags of heroin, and consumed alcohol on the day of the killing. In light of this "new" evidence, interpreted through the lense of New York Penal Law § 15.25, which allows evidence of intoxication to negate intent, the Court overturned the habeas grant, concluding that "we cannot say that no rational juror could have found beyond a reasonable doubt that Policano acted unintentionally." Id. at 117. Although Policano's petition was eventually denied in light of this evidence, nothing in this line of cases would appear to prohibit federal courts from continuing to consider those cases that predate both the finality of a petitioner's conviction and the "point of no return" in the Court of Appeals' evolving jurisprudence. See Fernandez v. Smith, 558 F.Supp.2d 480, 497-502 (S.D.N.Y.2008) (finding that developments in the law governing depraved indifference murder that took place before petitioner's conviction became final applied on collateral review); cf. People v. George, 43 A.D.3d 560, 562, 840 N.Y.S.2d 662 (2007) ("the Court of Appeals has consistently applied the current law to direct appeals involving depraved indifference, even where ... defendant's conviction preceded the change of law initiated on June 10, 2003 in Hafeez.") (citations omitted). Furthermore, if this Court is correct in distinguishing between the Court of Appeals' parallel jurisprudential threads regarding "charging errors" and "the depraved indifference element" of depraved indifference murder, a merits-based review of the instant petition which is premised on the former thread could also look to those decisions that post-date the finality of petitioner's conviction as applications of existing law to new facts. See, e.g., Bunkley, 538 U.S. 835, 123 S.Ct. 2020; Fiore, 531 U.S. 225, 121 S.Ct. 712; Policano II, 430 F.3d at 87. However, the Appellate Division held that petitioner's sufficiency claim was not properly preserved. Therefore, this Court cannot review the merits of the sufficiency issue absent a demonstration of cause and prejudice. As explained below, in reviewing counsel's performance for cause, this Court considers not what the law of New York was or is, but rather whether, in light of the case law known to him at the time, counsel's conduct fell below an objective standard of reasonableness. Despite the changes that have occurred since, it is unlikely that trial counsel's failure to preserve this claim at that time would have constituted ineffective assistance. Because appellate counsel recognized as much in deciding not to raise such a claim, this Court cannot find her failure to make this challenge to constitute ineffective assistance of appellate counsel. As a result, the petition must be denied. See, e.g., King v. Artus, 259 Fed.Appx. 346 (2d Cir.2008) (summary order) (holding that habeas review was barred where Appellate Division expressly relied on procedural default as independent and adequate state ground for its, denial of petitioner's depraved indifference sufficiency claim and petitioner had not demonstrated "cause for the default and actual prejudice as a result of the alleged violation of federal law, or ... that failure to consider the claims will result in a fundamental miscarriage of justice.") (citing Coleman v. Thompson, 501 U.S. 722, 750, 111 S.Ct. 2546, 115 L.Ed.2d 640 (1991)). II. Ineffective Assistance of Appellate Counsel A. Failure to Challenge Effectiveness of Trial Counsel In his attempt to get this Court to burrow down to the merits of his sufficiency claim, petitioner reiterates his argument that "appellate counsel rendered ineffective assistance when she did not raise that trial counsel was ineffective when he failed to object to the court's erroneous submission of the depraved indifference murder count to the jury ..." Pet. 4. It is worth noting that in so doing petitioner acknowledges that trial counsel indeed failed to preserve that issue.[7] On coram nobis, the Appellate Division rejected this claim on the merits, citing Jones v. Barnes, 463 U.S. 745, 103 S.Ct. 3308, 77 L.Ed.2d 987 (1983) and People v. Stultz, 2 N.Y.3d 277, 778 N.Y.S.2d 431, 810 N.E.2d 883 (2004). Soto, 22 A.D.3d 512, 801 N.Y.S.2d 546. Only if this Court finds that meritsbased determination to be "contrary to, or involve[] an unreasonable application of, clearly established Federal law, as determined by the Supreme Court of the United States," 28 U.S.C. § 2254(d), will petitioner be able to establish cause for the default of his sufficiency claim. A state court decision is contrary to federal law, as determined by the Supreme Court, if the state court applies a rule that contradicts governing Supreme Court precedent or the state court confronts a set of facts that is materially indistinguishable from a Supreme Court decision and arrives at a different result. Williams v. Taylor, 529 U.S. 362, 405-07, 413, 120 S.Ct. 1495, 146 L.Ed.2d 389 (2000). A decision is an "unreasonable application" of federal law if the state court's application of the correct governing Supreme Court precedent is objectively unreasonable. Id. at 409, 413, 120 S.Ct. 1495; see also Mask v. McGinnis, 252 F.3d 85, 88-89 (2d Cir.2001); Francis S. v. Stone, 221 F.3d 100, 109-11 (2d Cir.2000); Jones v. Stinson, 229 F.3d 112, 119 (2d Cir.2000). However, to be overturned as unreasonable, a decision must not only be incorrect but also unreasonable. Williams, 529 U.S. at 410-11, 120 S.Ct. 1495. Nevertheless, the Second Circuit has cautioned that, "although `[s]ome increment of incorrectness beyond error is required ... the increment need not be great; otherwise habeas relief would be limited to state court decisions so far off the mark as to suggest judicial incompetence.'" Mask, 252 F.3d at 89 (citing Francis S., 221 F.3d at 111). To demonstrate constitutionally ineffective assistance, petitioner must show (1) that counsel's performance "fell below an objective standard of reasonableness," Strickland v. Washington, 466 U.S. 668, 688, 104 S.Ct. 2052, 80 L.Ed.2d 674 (1984), and (2) that petitioner was prejudiced by the deficient performance, id. at 692, 104 S.Ct. 2052; accord Aparicio v. Artuz, 269 F.3d 78, 95 (2d Cir.2001) (applying Strickland to ineffective assistance of appellate counsel claim); Mayo v. Henderson, 13 F.3d 528, 533 (2d Cir.1994) (same). Because counsel is not required to advance every possible colorable claim, in order to demonstrate deficient performance to satisfy the first prong of Strickland, petitioner must show more than that counsel merely omitted a nonfrivolous argument. Aparicio, 269 F.3d at 95. As the Supreme Court noted in Jones v. Barnes, which the Appellate Division relied upon in denying petitioner's claim on the merits, "[experienced advocates since time beyond memory have emphasized the importance of winnowing out weaker arguments on appeal and focusing on one central issde or at most on a few key issues." 463 U.S. at 751-52, 103 S.Ct. 3308. The state court's rejection of petitioner's ineffective assistance of appellate counsel claim was neither contrary to nor an unreasonable application of Strickland. Without addressing the potential prejudice of the asserted error, the Court finds that appellate counsel's conduct did not fall below the objective standard of reasonableness. In a letter submitted by petitioner in his coram nobis petition, counsel acknowledged that "even unpreserved, [the sufficiency claim] is the strongest issue presented by the facts of your case," Resp.'s Ex. G, 5, but went on to explain that "[w]e cannot successfully raise an ineffective[ness] of counsel issue .... [because trial counsel's] failure to preserve the depraved indifference/intentional murder issue is not the type of error that would sustain an ineffectiveness claim," id. Counsel also noted that "[t]he court can [nevertheless] reach the merits of the issue through its interest of justice jurisdiction." Id. In an affirmation provided by appellate counsel in response to petitioner's coram nobis petition, counsel further explained that she decided not to argue ineffectiveness of trial counsel "because Mr. Soto's case was litigated in the trial court prior to the favorable Court of Appeals' decisions as to depraved indifference murder in [Payne, Gonzalez, and Hafeez]." Resp.'s Ex. I, 3. Despite the preservation issue, counsel managed to assert the substantive claim by asking the Appellate Division to "exercise its interest of justice jurisdiction [and] reverse the depraved indifference murder conviction as based on legally insufficient evidence ..." Resp.'s Ex. B, 18. Although the Appellate Division declined to exercise this discretion, counsel's actions and reasoning were both practical and strategic. Even if this Court were to hurdle the procedural bars and examine the effectiveness of petitioner's trial counsel, it would be unable to determine that his performance fell below the objective standard of reasonableness set forth in Strickland and its progeny. As the Supreme Court pointed out in Strickland, this retrospective examination requires that every effort be made to eliminate the distorting effects of hindsight, to reconstruct the circumstances of counsel's challenged conduct, and to evaluate the conduct from counsel's perspective at the time. Because of the difficulties inherent in making the evaluation, a court must indulge a strong presumption that counsel's conduct falls within the wide range of reasonable professional assistance ... 466 U.S. at 689, 104 S.Ct. 2052. "[J]udg[ing] the reasonableness of counsel's challenged conduct on the facts of the particular case, viewed as of the time of counsel's conduct," id. at 690, 104 S.Ct. 2052, this Court would not find trial counsel's failure to preserve petitioner's depraved indifference-related sufficiency claim objectively unreasonable. In People v. Sanchez, decided only five months prior to petitioner's trial, the Court of Appeals held that a point blank shooting presents "such a transcendent risk of causing death that it readily meets the level of manifested depravity needed to establish [depraved indifference] murder ..." 98 N.Y.2d 373, 378, 748 N.Y.S.2d 312, 777 N.E.2d 204 (2002).[8] As the Court of Appeals later stated in Policano IV, "Sanchez epitomized [the Court's] depraved indifference jurisprudence under the Register regime.... [E]ven though such an attack by its very nature presents compelling circumstantial evidence of intent to cause death, we considered the question of the defendant's state of mind to be a classic matter for the jury." Policano IV, 7 N.Y.3d at 599, 825 N.Y.S.2d 678, 859 N.E.2d 484. The fact that subsequent Court of Appeals' decisions have overruled depraved indifference murder convictions where strong evidence of intent existed does not change this Court's analysis of either trial or appellate counsel's performance. See Mayo, 13 F.3d at 533 ("Counsel is not required to forecast changes in the governing law."). B. Appellate Counsel's Failure to Appear In his reply papers, petitioner asserts a new and unexhausted ground of ineffective assistance of appellate counsel. Petitioner claims that: appellate counsel did not make oral argument before the Appellate Division, Second Judicial Department, because she was in an automobile accident and on information and belief was hospitalized. [And t]hat no attorney from the Legal Aid Society office appeared in petitioner's behalf.... Counsel's absentee] during a critical stage of the corrective judicial process was a violation of petitioner's constitutional right to due process... Pet's Reply 8-9.[9] The Court construes this argument as an attempt to amend the pleadings pursuant to Fed. R. Civ. Pro. 15 and denies the amendment as time-barred. Because this separate and distinct claim of ineffectiveness "asserts a new ground for relief supported by facts that differ in both time and type from those the original pleading set forth," it does not "relate back" and thus is barred by AEDPA's one-year time limit. Mayle v. Felix, 545 U.S. 644, 650, 125 S.Ct. 2562, 162 L.Ed.2d 582 (2005); accord Porter v. Greiner, No. CV 00-6047, 2005 WL 3344828 (E.D.N.Y. Nov. 18, 2005). III. Sentencing Under New York's Persistent Violent Felony Offender Statute Petitioner asserts that his "adjudication and sentence pursuant to New York's persistent violent felony, offender statute was unconstitutional under the principles announced in Apprendi v. New Jersey, 530 U.S. 466, 120 S.Ct. 2348, 147 L.Ed.2d 435 (2000)." Pet, 4. As noted above, this claim was rejected on the merits by the Appellate Division. Petitioner acknowledges that he "understands that this argument has been rejected by the Court of Appeals in People v. Rosen, 96 N.Y.2d 329, 728 N.Y.S.2d 407, 752 N.E.2d 844 (2001)," but "contends that the Supreme Court in a recent decision has expressed misgivings of its holding in Almendarez-Torres..." Pet's Reply, 20 (citing Rangelr-Reyes v. United States, 547 U.S. 1200, 126 S.Ct. 2873, 165 L.Ed.2d 910 (2006)). Petitioner is correct in noting that both Justice Stevens in his statement respecting denial of certiorari in Rangel-Reyes and Justice Thomas in his dissent from the same express reservations about the continuing validity of Almendarez-Torres v. United States, 523 U.S. 224, 118 S.Ct. 1219, 140 L.Ed.2d 350 (1998), which affirmed the constitutionality of using prior convictions for sentence enhancement. Unfortunately for plaintiff, neither comment constitutes a judicial holding. Two recent decisions, one from this district and one from a sister-district, have questioned the post-Booker constitutionality of New York's persistent felony offender statute, N.Y. Penal Law § 70.10. Portalatin v. Graham, 478 F.Supp.2d 385, 394 (E.D.N.Y.2007) ("Section 70.10 violates the Sixth Amendment because it allows judges to enhance a criminal defendant's sentence beyond what the jury verdict alone would allow if, and only if, such enhancement is supported by judicial findings other than the fact of prior convictions.") (emphasis added); Washington v. Poole, 507 F.Supp.2d 342, 358 (S.D.N.Y.2007) (same). However, neither of those opinions questioned the continued constitutionality of New York's persistent violent felony offender statute, N.Y. Penal Law § 70.08(2), which provides for sentencing enhancements based solely on prior convictions and under which petitioner was sentenced. Portalatin, 478 F.Supp.2d at 392 (distinguishing § 70.08(2)); Poole, 507 F.Supp.2d at 353-54 (same). Unless and until the Supreme Court revisits Almendarez-Torres, this Court finds that § 70.08(2) continues to fit into the safe harbor for recidivism-based sentencing enhancements established by that case and reiterated in Apprendi, 530 U.S. at 488-90, 120 S.Ct. 2348. See, e.g., Washington v. Graham, No. CV-07-1706, 2007 WL 3197335 (E.D.N.Y. Oct. 26, 2007); Hayes v. Ercole, No. 06 Civ. 4073, 2007 WL 2403339 (S.D.N.Y. Aug. 20, 2007). CONCLUSION The application for a writ of habeas corpus is denied, and the petition is dismissed. Because petitioner has not "made a substantial showing of the denial of a constitutional right," 28 U.S.C. § 2253(c)(2), a certificate of appealability shall not issue. In addition, this Court certifies pursuant to 28 U.S.C. § 1915(a)(3) that any appeal would not be taken in good faith. Coppedge v. United States, 369 U.S. 438, 82 S.Ct. 917, 8 L.Ed.2d 21 (1962). The Clerk of the Court is directed to close this case. SO ORDERED. NOTES [1] Petitioner also argued the separate state law claim that his conviction was against the "weight of the evidence." This claim was denied by the Appellate Division on the merits and, as petitioner acknowledges in his reply, is not reviewable on collateral attack. Lewis v. Jeffers, 497 U.S. 764, 780, 110 S.Ct. 3092, 111 L.Ed.2d 606 (1990) (habeas corpus review is not available for an alleged error of state law). [2] Petitioner's original § 2254 motion also included claims related to the admission of evidence regarding his prior robbery of the victim and "weight of the evidence." However, plaintiff later withdrew these claims in his reply to the state's response to his petition. [3] In addition to the opinions in Policano III and IV, which are discussed below, Judge Block of this district found in Guzman v. Greene, 425 F.Supp.2d 298 (E.D.N.Y.2006), before the Second Circuit certified in Policano and before the Court of Appeal's decision in Feingold, that Hafeez, Gonzalez and Payne created new law and were therefore retroactively inapplicable. Separately, the Appellate Division for the Third Division has more recently held that the appropriate breaking point occurred in Payne. People v. Baptiste, 51 A.D.3d 184, 853 N.Y.S.2d 719 (2008). [4] Judge Kaye distinguished People v. Sanchez, 98 N.Y.2d 373, 748 N.Y.S.2d 312, 777 N.E.2d 204 (2002) from this line of cases by citing the fact that the shooting in that case "occurred in an area where children were playing, thus presenting a heightened risk of unintended injury." 7 N.Y.3d at 606, 825 N.Y.S.2d 678, 859 N.E.2d 484. Though factually correct, this logic, which was first asserted in Hafeez, 100 N.Y.2d at 259, 762 N.Y.S.2d 572, 792 N.E.2d 1060, and later reiterated in Gonzalez, 1 N.Y.3d at 468, 775 N.Y.S.2d 224, 807 N.E.2d 273, Payne, 3 N.Y.3d at 272, 786 N.Y.S.2d 116, 819 N.E.2d 634, and Suarez, 6 N.Y.3d at 213, n. 7, 811 N.Y.S.2d 267, 844 N.E.2d 721, was never asserted by the Sanchez court, see Suarez, 6 N.Y.3d at 224, 811 N.Y.S.2d 267, 844 N.E.2d 721 (Graffeo, J., concurring in part and dissenting in part) (noting that "the Sanchez opinion neither relied on danger to multiple individuals as a decisive factor supporting a finding of depraved indifference, nor suggested that such a fact was crucial to its reasoning."). [5] Although the Policano II Court did not provide citations for this holding, this Court finds support in the Supreme Court's decisions in Fiore v. White, 531 U.S. 225, 121 S.Ct. 712, 148 L.Ed.2d 629 (2001) (holding that where an intervening state law decision "merely clarified" the plain language of a statute, a prior conviction that is contradicted by that decision violates due process) and Bunkley v. Florida, 538 U.S. 835, 841-42, 123 S.Ct. 2020, 155 L.Ed.2d 1046 (2003) (clarifying that "[t]he proper question under Fiore is not just whether the law changed. Rather, it is when the law changed."). [6] In a vigorous dissent, joined by Judges Walker, Jacobs, Cabranes and Wesley, Judge Raggi argued that to the extent that Gonzalez and Payne "held that a depraved indifference theory should not be charged or that a jury verdict of depraved indifference murder should not stand if a trial or reviewing court concludes that the evidence would only support a verdict of intentional murder, they represent a decided sea change in New York law..." and as such, should not be applied retroactively. Policano III, 453 F.3d at 88. [7] This then is not a case like Fernandez, 558 F.Supp.2d 480 (S.D.N.Y.2008), where Judge Chin found, in light of an incomplete trial transcript, that the Appellate Division had erroneously determined that petitioner's trial counsel failed to preserve his challenge to the sufficiency of the depraved indifference conviction. [8] That several later Court of Appeals decisions attempted to distinguish Sanchez on the grounds that there were children playing in the room into which defendant shot, see, note 2 supra, is of no matter here because the holding in Sanchez is devoid of such reasoning and those decisions, which came down after petitioner's trial, were in any case not foreseeable to petitioner's counsel at the time. [9] Section 460.80 of the New York Code states that "[t]he mode of and procedure for arguing or otherwise litigating appeals in criminal cases are determined by rules of the individual appellate courts. Among the matters to be determined by such court rules are the circumstances in which oral argument is required and those in which the case may be submitted by either or both parties without oral argument; the consequences or effect of failure to present oral argument when such is required; the amount of time for oral argument allowed to each party; and the number of counsel entitled to be heard." McKinney's CPL § 460.80 (emphasis added). The relevant procedural rule adopted by the New York Appellate Division for the Second Department and in force at the time of petitioner's appeal states that "[u]nless the Justice designated to determine the application shall otherwise direct, the matter shall be submitted and determined upon the foregoing papers and without oral argument." 22 N.Y.C.R.R § 670.12(b)(4) (as amended Oct. 12, 2003, effective Jan. 1, 2004).	{ "pile_set_name": "FreeLaw" }
935 F.2d 1283 U.S.v.Torres (Raymond) NOS. 91-1023, 90-1024 United States Court of Appeals,Third Circuit. MAY 23, 1991 1 Appeal From: E.D.Pa. 2 AFFIRMED.	{ "pile_set_name": "FreeLaw" }
171 Pa. Superior Ct. 397 (1952) Commonwealth v. Friday, Appellant. Superior Court of Pennsylvania. Argued March 24, 1952. August 7, 1952. 399 Before RHODES, P.J., HIRT, RENO, DITHRICH, ROSS, ARNOLD and GUNTHER, JJ. Desmond J. McTighe, with him Robert Trucksess and Duffy, McTighe & McElhone, for appellant. Anthony L. Differ, Assistant District Attorney, with him J. Stroud Weber, District Attorney, Roger B. Reynolds and C. Howard Harry, Jr., Assistant District Attorneys, for appellee. OPINION BY RENO, J., August 7, 1952: Appellant was indicted for rape. On the second trial[1] the court charged: "You might find one of three verdicts, guilty of rape, guilty of attempt to commit rape, or not guilty." He was found guilty of attempted rape. His motion for a new trial was allowed, but, upon the Commonwealth's petition for reargument, which was allowed, the new trial was refused. Appellant was sentenced to pay a fine of $1.00 and undergo imprisonment in the county jail for 4 months. On this appeal he did not question the sufficiency of the 400 evidence to sustain the conviction and limited his argument to alleged trial errors. Only enough of the testimony will be stated to furnish a broad background against which the legal problems can be discussed. In the early afternoon of August 24, 1950, Gertrude McKendrick, aged 34, a married woman living with her husband and the mother of 5 children,[2] was driving her Chevrolet coupe from her home to her work in a factory. She passed another car, allegedly driven by appellant, who waved to her, followed her, cut in front of her car, and stopped. She stopped and attempted to reverse her car but it stalled. Appellant, so she testified, left his car, came to the left side of her car, asked for a date, grabbed her head through the front window, entered her car, pushed her from the driver's position, placed her left arm against the back of the seat, and her right arm under her body, forced one leg over the back of the seat and the other down toward the floor and, with his feet protruding out of the window, penetrated her sexual organ, apparently without emission. Against this was the testimony of two witnesses, produced by appellant, friends and co-workers of Mrs. McKendrick, who testified that she told them that she had been accosted by a stranger, who asked for a date, pulled up her clothes and kissed her, but that she had not been raped. Appellant's defense was an alibi and a denial that Mrs. McKendrick had been raped. However, he admitted that he had told State police that he had met the woman in the way described by her, talked to her and kissed her while leaning in the door of her car, but 401 denied that he had entered the car.[3] Further reference will be made to this pre-trial statement. Appellant's contentions will be examined in the order in which they appear in his brief. I. As stated, the trial judge charged that appellant might be found guilty of rape or attempted rape or acquitted. Appellant argues that he should also have charged that he might be found guilty of simple assault and battery. At the end of the charge the trial judge asked: "Are there any suggestions or corrections or anything we may have overlooked or misstated?" Appellant entered several objections and exceptions to portions of the charge, but made no complaint of the omission he now characterizes as fundamental error. The question has been settled by Com. v. Moskorison, 170 Pa. Superior Ct. 332, 336, 85 A. 2d 644, where Judge HIRT said: "The absence of a specific instruction on the trial of an indictment for rape, that the prisoner might be convicted of fornication if the jury doubted his guilt of the more serious charge is not ground for reversal, if it appears that no such instruction was asked for." See also Com. v. Thomas, 275 Pa. 137, 118 A. 667; Com. v. Peach, 170 Pa. 173, 32 A. 582; Com. v. Magliarditi, 158 Pa. Superior Ct. 461, 45 A. 2d 244. II. The trial judge charged: "Well, does that mean that the person who is charged with having committed this act did not penetrate? If that is the contention, then it may be that the person would be guilty or might be found guilty of an attempt to commit rape, which is a misdemeanor, as distinguished from a felony." The Act of March 31, 1860, P.L. 382, § 93, under which assault 402 and battery with intent to commit rape was punishable as a misdemeanor, was superseded by The Penal Code of June 24, 1939, P.L. 872, § 722, 18 P.S. § 4722, and that offense is now a felony. Attempted rape is the equivalent of assault and battery with intent to ravish. Com. ex rel. Conrad v. Warden of Eastern State Penitentiary, 165 Pa. Superior Ct. 374, 67 A. 2d 645. The charge was erroneous. But again, with ample opportunity to secure a correct charge, appellant remained silent, and we have not been persuaded that he was harmed by the error. Indeed, so far from harming appellant, the judge's error really benefited him. Under the impression, probably, that no specific punishment had been prescribed for the misdemeanor of attempted rape, (Cf. Com. v. Orris, 136 Pa. Superior Ct. 137, 7 A. 2d 88), he sentenced appellant to a fixed term in the county jail instead of imposing a minimum and maximum sentence to be served in the penitentiary, as provided for in The Penal Code of 1939, supra. III. The pre-trial statement, to which reference has been made, was taken under circumstances, concerning which there is conflict in the testimony, but of which the following is a fair summary. While driving in his car with his wife and son on August 29th at about 6 p.m. he was picked up by two State Policemen who took him to their barracks at Collegeville. While there he was identified in the usual police line-up by Mrs. McKendrick and by Mrs. McDermott, who had seen appellant drive away from the scene of the alleged crime. Thereafter he was taken past the same scene and at 11 p.m. was lodged in the police station at Lansdale. At 2:30 p.m. of the following day he was arraigned before a justice of the peace, given a preliminary hearing, and committed to the county jail at Norristown. He was in police custody not more than 21 hours before the arraignment. 403 At the Lansdale police station breakfast was served to him as well as lunch. He was questioned from time to time by State Police Officer Kweder, no one interrogation continuing more than 10 minutes. Either he asked for the information, or, without asking, he was told that the penalty for rape was 15 years, and thereafter he made the pre-trial statement related above. There was no physical force or mental torture or threats or promises, no long or exhausting interviews, no deprivation of food or sleep. He was not held incommunicado, as he now argues. His wife accompanied him to the barracks, was interviewed by the police officers, and she knew where he was. Appellant's father and his two brothers called at the barracks at 9 p.m., and left to procure and return with time sheets showing that appellant had been working the entire day of August 24th,[4] but they did not return before 10:30 p.m., when the officers took appellant to the scene of the crime. On the following morning, before the preliminary hearing, the police interviewed the father at the home of the district attorney. There was testimony that appellant requested the services of counsel. He testified that he told the police officers he had three dollars and wanted a lawyer, but, facetiously, as we read the printed record, he was told "you couldn't get to first base with three dollars with a lawyer." There are intimations in the record that some one, acting on appellant's behalf, had been in touch with a Phoenixville lawyer who may have telephoned to the barracks but did not appear there or at the police station. Evidently, there was a race between the police and the possible appearance of a lawyer; for 404 Officer Kweder candidly testified on cross-examination: "Q. And yet you still felt you wanted to make a further investigation and wouldn't let a lawyer see him until after that was made? A. That is right. I figured that we could break him down, and we did. The following afternoon he broke down." However that may be, appellant's statement was made voluntarily. Officer Kweder testified that at the preliminary hearing: "His father showed me a newspaper. He said, `You have the wrong man.' He said, `Here is the man you are looking for', and the defendant, LeRoy Friday, Jr., he said, `Pop, I told them everything. Keep quiet.' The father still insisted that I read the newspaper and still insisted that we had the wrong man, and the defendant repeated again, `Pop, I confessed. I told them everything.'"[5] Relying upon Watts v. Indiana, 338 U.S. 49, 69 S. Ct. 1347, and Turner v. Pennsylvania, 338 U.S. 62, 69 S. Ct. 1352, appellant argues that his statement was a coerced confession. In the Watts case the prisoner was held for 6 days, during which he was questioned by relays of officers from 5:30 or 6 p.m. until 2 or 3 a.m., before he was taken to a magistrate. In the Turner case the prisoner was questioned by relays of officers for 4 to 6 hours a day for 5 days before he was taken to a magistrate. Factually, at least, the instant case does not fit into the Watts and Turner pattern. Whatever be the impact of the opinions of the United States Supreme Court, this Court is bound by the decisions of the Supreme Court of Pennsylvania,[6]405 which has provided the controlling authority in a recent case, Com. v. Shupp, 365 Pa. 439, 446, 448, 75 A. 2d 587. It was decided after the Watts and Turner cases, and Mr. Justice BELL, speaking for our Supreme Court, indicated that its decision was in harmony with the cases decided by the Supreme Court of the United States. Shupp was held for 15 days without a preliminary hearing, during which he was frequently questioned by the authorities. He asked for counsel but apparently abandoned his request. At least he talked freely and voluntarily without the presence or assistance of counsel. The Court held, "There is no prescribed time within which a preliminary hearing must be held." . . . "There is no provision in the law of Pennsylvania, or any decision of the United States Supreme Court or of our Court which requires that a person arrested, even though on a charge of murder, must be provided with counsel as soon as he is taken into custody, or prior to indictment or arraignment." Reliance was placed upon Com. v. Agoston,[7] 364 Pa. 464, 483, 72 A. 2d 575, and the vigorous statement of Chief Justice MAXEY was quoted: "(1) The fact that the confessor is in custody and has no counsel does not invalidate a confession made by him. (2) The fact that the interrogation of a suspect continues until he confesses is not per se a ground for invalidating his confession, nor is the fact that the interrogation lasted for a considerable period of time any ground for invalidating the confession, unless the interrogation was so long in duration as to amount to mental or physical coercion and duress." (Italics are Justice BELL'S.) 406 The foregoing summary of the evidence and the citation of the relevant authorities support the conclusion that appellant's constitutional rights were not violated and that his oral confession was properly admitted. IV. When Officer Kweder testified he referred to notes which he had made for the purpose of refreshing his recollection. Appellant's counsel asked for and received permission to inspect the notes, and used them in his cross-examination of Kweder. In addition, counsel demanded production of the entire file of records and papers relating to the case lodged in the Collegeville barracks and for that purpose caused a subpoena duces tecum to be served on the commanding officer. Officer Kweder informed the trial judge that the orders of his superiors forbade production of the records of the State Police. Consequently, the trial judge ruled that a subpoena duces tecum served upon a subordinate policeman was ineffective and that service must be made upon the Commissioner of the State Police. The ruling was manifestly correct. While the records were in the physical possession of the commanding officer of the Collegeville barracks, he was not the legal custodian. The executive head of the State Police, the Commissioner of the State Police, is the legal custodian of the records, and their production in the courts can be procured, where the public interest requires their disclosure, only under a subpoena duces tecum, served upon the Commissioner. See Mark's Appeal, 121 Pa. Superior Ct. 181, 183 A. 432; Hartranft's Appeal, 85 Pa. 433. Moreover, it should be noted, appellant did not intend to impeach Kweder's credibility by statements in the police files. In his brief appellant candidly stated: "It was very material to the credibility of the Commonwealth's witnesses, Mrs. McKendrick and Mrs. McDermott, to know exactly what description they gave the State Police of the alleged assailant and his car. 407. . . If the records showed that the first description given by Mrs. McKendrick and Mrs. McDermott to the State Police was that of a bald headed man instead of a dirty blond or was that of a man 7' 2" tall instead of 5' 7"" or was that of a man 58 years old instead of 28 years old, these discrepancies certainly would have been material to the case." That is, appellant would have the Commonwealth supply information whereby appellant could test the credibility of the Commonwealth's own witnesses. No such duty rests upon the State Police. Should judicial pampering of convicts and defendants continue, we may arrive at the point where the prosecution will be bound to reveal every structural weakness in its case; that is, supply a defendant with a reasonable doubt. Until then, however, the Commonwealth is under no obligation to place the secret files of police investigators at the disposal of defendants. On defendant's request, a district attorney should allow him to examine a report submitted to the district attorney of an examination made by an expert witness. Com. v. Neill, 362 Pa. 507, 67 A. 2d 276. But a district attorney does not have custody or control of reports of investigations made by the State Police and cannot, without the consent of the Commissioner, produce them or reveal their contents. V. Appellant contends that the trial judge failed to relate the rule of reasonable doubt to those parts of his charge which covered appellant's evidence of good character and alibi. In respect to the character evidence the trial judge charged that "it may raise a reasonable doubt." Concerning the alibi, after stating that it was an affirmative defense which the defendant was obliged to prove by a preponderance of the evidence, said: "[T]he fact that that burden is placed upon him in the presentation 408 of his affirmative defense does not change the rule that under all the evidence you must be satisfied beyond a reasonable doubt, and it goes in with all the other testimony as to whether or not it creates the reasonable doubt referred to earlier in this charge." The instructions contained the essential requirements of Com. v. Padden, 160 Pa. Superior Ct. 269, 50 A. 2d 722, (character evidence), and Com. v. Jordan, 328 Pa. 439, 196 A. 10, (alibi) and, in the absence of a request for further and more explicit instructions, were adequate. VI. Finally, appellant contends that the "conduct and remarks of the assistant district attorney throughout the trial were prejudicial to the defendant." The trial consumed five days and the printed testimony runs to 488 pages. It was a hotly contested case and produced the usual tension and wrangling. Our study of all the testimony informs us that the assistant district attorney was an aggressive prosecuting officer, and appellant's attorneys were equally belligerent. The record discloses that counsel on both sides are vigorous trial lawyers, amply able to take care of themselves and their client's contentions. Combative conduct on one side provoked and justified strenuous retaliation by the other. The record affords no data for the appraisal of responsibility. In this situation we shall not draw a line where the court below would not. At the close of the trial, after listening to a wordy dispute between counsel at side-bar, Judge CORSON said: "Oh, let the whole matter drop." And that is about all that any court, nisi prius or appellate, can say when both sides are equally right and equally wrong. The judgment and sentence are affirmed; and it is ordered that the defendant appear in the court below at such time as he may be there called and that he be *409 committed by that court until he has complied with the sentence, or such part thereof as had not been performed when the appeal was made a supersedeas. NOTES [1] At the first trial the jury disagreed and was discharged. [2] Defendant was 28 years of age, married, living with his wife, the father of two children. [3] He also admited in the instant trial that at the first trial he had denied making this pre-trial statement. [4] It subsequently developed that appellant had not been working on that day. He relied as an alibi on his presence in the Chiropractor's Hospital in Norristown at the time the crime was committed. [5] The father was called as a witness for appellant but he was not examined concerning this episode. [6] "Upon any question whatever before the said [superior] court the decision of the supreme court shall be received and followed as of binding authority": Act of June 24, 1895, P.L. 212, § 10, 17 P.S. § 198. [7] The United States Supreme Court denied certiorari. 340 U.S. 844, 71 S. Ct. 9. This case deserves diligent study by the profession and the police. Note the Chief Justice's statement, p. 480: "The only function counsel could have at the time of a suspect's interrogation would be to instruct him to `keep his mouth shut'".	{ "pile_set_name": "FreeLaw" }
In The Court of Appeals Sixth Appellate District of Texas at Texarkana No. 06-13-00146-CR SHARON LEE DOWNES, Appellant V. THE STATE OF TEXAS, Appellee On Appeal from the 349th District Court Houston County, Texas Trial Court No. 10CR270 Before Morriss, C.J., Carter and Moseley, JJ. Memorandum Opinion by Justice Carter MEMORANDUM OPINION Sharon Lee Downes was convicted of retaliation 1 by a Houston County 2 jury after she refused the appointment of counsel, chose to represent herself at trial, and failed to attend the trial after having participated in the jury selection process on the preceding day. Downes was sentenced to ten years’ incarceration and was fined $5,000.00. We affirm the judgment of the trial court because (1) Downes’ waiver of the right to counsel was intelligent, voluntary, knowing, and competent, and (2) the trial court did not abuse its discretion in determining that Downes voluntarily absented herself from trial. I. Downes’ Waiver of the Right to Counsel Was Intelligent, Voluntary, Knowing, and Competent A. Knowing, Voluntary, and Intelligent Waiver Downes initially claims that she failed to knowingly, intelligently, and voluntarily waive her right to counsel, which was “a predicating and significant factor in insuring that appropriate due process was thwarted.” “The Sixth and Fourteenth Amendments of our Constitution guarantee that a person brought to trial in any state or federal court must be afforded the right to the assistance of counsel before he can be validly convicted and punished by imprisonment.” Faretta v. California, 422 U.S. 806, 807 (1975). “Those amendments also guarantee that any such defendant may dispense with counsel and make his own defense.” Collier v. State, 959 S.W.2d 621, 625 (Tex. Crim. 1 TEX. PENAL CODE ANN. § 36.06 (West 2011). 2 Originally appealed to the Twelfth Court of Appeals, 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 are unaware of any conflict between precedent of the Twelfth Court of Appeals and that of this Court on any relevant issue. See TEX. R. APP. P. 41.3. 2 App. 1997) (citing Faretta, 422 U.S. at 818–20); see Adams v. United States ex rel. McCann, 317 U.S. 269, 279 (1942) (“[T]he Constitution does not force a lawyer upon a defendant.”). A defendant’s decision to dispense with counsel must be made “(1) competently, (2) knowingly and intelligently, and (3) voluntarily.” Collier, 959 S.W.2d at 625 (citing Godinez v. Moran, 509 U.S. 389, 400–01 (1993); Faretta, 422 U.S. at 834–35). When a defendant asserts the right to represent herself, the trial court must admonish the defendant about the dangers and disadvantages of self-representation “so that the record will establish that [s]he knows what [s]he is doing and [her] choice is made with [her] eyes open.” Faretta, 422 U.S. at 835 (quoting Adams, 317 U.S. at 279); see TEX. CODE CRIM. PROC. ANN. art. 1.051(g) (West Supp. 2013) (stating court “shall advise the defendant of the nature of the charges . . . and, if the defendant is proceeding to trial, the dangers and disadvantages of self-representation”). If: (1) a defendant clearly and unequivocally declares to a trial judge that he wants to represent himself and does not want counsel, (2) the record affirmatively shows that a defendant is literate, competent, and understanding and that he is voluntarily exercising his informed free will, and (3) the trial judge warns the defendant that he thinks it is “a mistake not to accept the assistance of counsel” and that the defendant will “be required to follow all the ‘ground rules’ of trial procedure,” the right of self-representation cannot be denied. Dolph v. State, No. 06-13-00029-CR, 2013 WL 6709943, at *1 (Tex. App.—Texarkana Dec. 20, 2013, pet. ref’d) (quoting Faretta, 422 U.S. at 835–36). Downes appeared with court-appointed counsel at a pretrial hearing on August 30, 2012. At the outset of the hearing, Downes’ court-appointed attorney, joined by Downes, moved the court to withdraw from representation. 3 Downes immediately indicated that she intended to 3 The trial court ultimately granted the motion to withdraw. 3 handle the case herself and that she had already filed a motion to dismiss. On the heels of this announcement, the trial court conducted a detailed and lengthy Faretta inquiry. The court’s inquiry revealed that Downes was forty-seven years old, had a high school diploma, and had over 200 college hours from various courses taken “through the years.” The inquiry further indicated that, in the past, Downes was employed in the area of outside sales. The trial court asked Downes if she understood that criminal litigation is complex and that having the guidance of counsel would be better than her own, unskilled efforts. Downes indicated that she understood. Downes acknowledged her basic unfamiliarity with the rules of criminal procedure, but stated that she was familiar with courtroom procedure. When asked if she was familiar with the Rules of Evidence, Downes indicated her familiarity with certain Rules. The trial court admonished that the Rules of Evidence included “a lot more” than that. Downes acknowledged that she probably did not know how to preserve error for appeal. The trial court further inquired into Downes’ knowledge of the concepts of (1) lesser-included offenses, (2) range of punishment, and (3) mitigating evidence. While Downes’ knowledge of these areas was limited, she indicated that she was familiar with the facts of her case, had researched her case, and had good organizational skills. The court advised Downes that “[p]eople that choose to represent themselves could be at an extreme, extreme disadvantage . . . because the state’s attorney will have gone to law school . . . would have studied procedure . . . the Rules of Evidence, would have studied everything that relates to law in the case, and will have a valid law license.” Downes indicated that she understood the disparity in her own level of skill in these areas and that of a person with a law license and stated that she understood that this 4 set of circumstances would place her at an extreme disadvantage. The court informed Downes that she was charged with a third degree felony, which carries a punishment range of two-to-ten years’ prison time. Downes was admonished that her ignorance of the law, lack of experience, refusal to look at the big picture, and exercise of poor judgment in refusing a lawyer could result in prison time. Downes indicated that she understood all of those issues. The court told Downes that, although she could not be forced to accept the appointment of counsel, accepting the assistance of counsel was the wise decision. The trial court further warned Downes that handling the case on her own would be “extremely stupid” and “absolutely stupid.” Downes acknowledged, “It’s a risk. I do agree with that, and I appreciate it.” The court continued its efforts to persuade Downes, stating, “You are looking at two to ten to do and looking, potentially, at another felony,” to which Downes’ replied, “I understand.” In frustration, the court stated, I’m going to ask one last time. It is absolutely crazy, I think, in my mind, for you to represent yourself; however, you may do so, or the Court will appoint you a lawyer. Do you want the Court to appoint you a lawyer, or do you want to go on your own? Downes continued in her quest to represent herself. After again indicating her strong disagreement with that decision, the court indicated that counsel would be appointed for Downes should she change her mind. The court concluded, “The Court having conducted the Faretta hearing as required by law, thinks it is not wise, has done everything possible to convince Ms. Downes otherwise, but the Court will authorize Ms. Downes to represent herself in a pro se capacity.” 5 Later, during the same hearing, Downes presented a motion to the court. When Downes was informed that the court did not have jurisdiction to hear the motion, she stated that she was doing the best she could. At that point, the court pointed out, “That’s an example of what I was telling you, you would be your own worst enemy being your own lawyer. Do you want to reconsider?” At that point, Downes agreed to accept the appointment of counsel. The following day, Downes penned a letter to the trial court stating that she refused to work with court-appointed counsel. Downes wrote, “[I]t is not in my best interest to work with any staff on the Houston County list as I will not receive effective representation.” Downes indicated that she would continue to represent herself, claiming that although she is not an attorney and does not claim to know everything, “this is a no brainer case that does not meet Texas Penal Code 36.06 requirements for prosecution, it will not go to trial, the case is frivolous hearsay, it does not even belong in Pre-School Time Out Court and I can handle it.” In a letter to her appointed counsel dated September 30, 2012, 4 Downes informed counsel that she was terminating his representation and specifically requested that counsel refrain from contacting her. Consequently, on November 6, 2012, Downes’ attorney filed a motion to withdraw as counsel because Downes no longer wanted to be represented by counsel. Counsel further explained that Downes instructed him not to contact her, that she would not cooperate in the preparation of her defense, and that she instructed counsel to file a motion to withdraw. At the hearing on the motion to withdraw, the trial court reminded Downes of the August hearing in which Downes eventually decided that she wanted court-appointed counsel to 4 Although the letter is dated September 30, 2012, it includes the caption “FINAL WARNING NOTICE 10/29/12.” 6 represent her. Downes informed the court that the court decided that for her and that she “really didn’t want that.” The court again advised Downes that her decision was not smart, stating, “You might be doing more harm than good.” Downes continued to insist on self-representation. When Downes expressed irritation at the fact that appointed counsel filed a motion to suppress evidence on her behalf, the court explained that counsel was “trying to cover [her] backside.” The court persisted in attempting to dissuade Downes from self-representation. The court stated, “I’m trying to convince you a lawyer is your best way to go to get the best representation you possibly can get.” When it was apparent that Downes would not be persuaded to accept appointed counsel, the trial court appointed stand-by counsel and explained that counsel was available for legal advice during trial and was also available to step in and defend Downes at any time. There is no question on this record, which indicates Downes rejected two court-appointed attorneys in favor of self-representation, that Downes unequivocally declared to the trial court, numerous times, her desire to represent herself. The trial court warned Downes, also numerous times, that it was unwise to refuse the assistance of counsel and that Downes would be expected to follow all applicable rules and procedures. Nevertheless, Downes contends that her poor performance during voir dire is proof that the trial court failed to ensure that the trial was conducted fairly. “It is undeniable that in most criminal prosecutions defendants could better defend with counsel’s guidance than by their own unskilled efforts.” Faretta, 422 U.S. at 834. The performance of a pro se defendant is not the standard by which we determine whether a defendant knowingly and intelligently waived the assistance of counsel. 7 Here, Downes repeatedly asserted her desire to act pro se, despite numerous warnings from the trial court of the potential negative consequences. The trial court permitted Downes to represent herself only after (1) informing her of her absolute right to appointed counsel, (2) admonishing Downes of the dangers of self-representation in light of the evidentiary and procedural rules she was required to follow, (3) confirming that Downes knew the charges against her and the range of punishment, and (4) determining that she was literate, had graduated from high school, and had attended some college. See Collier, 959 S.W.2d at 626. Downes confirmed that she understood the risks of self-representation and elected to proceed in the face of those risks. “Personal liberties are not rooted in the law of averages. The right to defend is personal. The defendant, and not his lawyer or the State, will bear the personal consequences of a conviction.” Faretta, 422 U.S. at 834. We find Downes’ waiver of the right to counsel was knowing, voluntary, and intelligent. B. Competent Waiver Downes further contends that the trial court failed to take her mental capacity into account when evaluating her waiver of the right to counsel. This argument is based on the premise that, although Downes was competent to stand trial, she was not mentally competent to represent herself at trial. In support of this position, Downes relies on Indiana v. Edwards, 554 U.S. 164 (2008), in which the United States Supreme Court considered the issue of whether the Constitution requires a state trial court to permit a mentally ill defendant, on request, to conduct his own defense at trial. Generally, “‘the competence that is required of a defendant seeking to waive his right to counsel is the competence to waive the right, not the competence to represent 8 himself.’” Id. at 172 (quoting Godinez v. Moran, 509 U.S. 389, 399 (1993)). The Court, however, “caution[ed] against the use of a single mental competency standard for deciding both (1) whether a defendant who is represented by counsel can proceed to trial and (2) whether a defendant who goes to trial must be permitted to represent himself.” Id. at 175. The Court held, [T]he Constitution permits judges to take realistic account of the particular defendant’s mental capacities by asking whether a defendant who seeks to conduct his own defense at trial is mentally competent to do so. That is to say the Constitution permits States to insist upon representation by counsel for those competent enough to stand trial under Dusky[5] but who still suffer from severe mental illness to the point where they are not competent to conduct trial proceedings by themselves. Id. at 177–78 (emphasis added). The mental-illness-related limitation on the scope of the right to self-representation articulated in Edwards was recognized by the Texas Court of Criminal Appeals in Chadwick v. State, 309 S.W.3d 558, 561 (Tex. Crim. App. 2010). The trial judge is in the best position to decide whether a mentally ill defendant is competent to proceed pro se. Edwards, 554 U.S. at 177; Chadwick, 309 S.W.3d at 561. Because the issue on appeal is a mixed question of law and fact which turns on an evaluation of credibility and demeanor, we review the trial court’s ruling for an abuse of discretion. Chadwick, 309 S.W.3d at 561. We view the evidence in the light most favorable to the trial court’s ruling and will imply any findings of fact supported by the evidence and necessary to support the trial court’s ruling in the absence of explicit findings. Id. We recognize that Downes has a history of mental illness. The trial court acknowledged and addressed this issue at the August 2012 Faretta hearing. Among the items discussed was the 5 Dusky v. United States, 362 U.S. 402 (1960) (per curiam) (defining competency to stand trial). 9 fact that the trial court had previously found Downes incompetent to stand trial in this case. 6 After Downes was briefly hospitalized at the Rusk County Hospital, the trial court found Downes competent to stand trial on May 12, 2011. Over a year after that decision, at the Faretta hearing, Downes indicated that she was currently seeing her doctor on a regular basis and that she was taking lithium for, as Downes described it, a very mild case of bipolar disorder that is under control. Downes’ description of her illness as mild and well-controlled is supported by the record, which indicates that she had the ability to communicate clearly and to conduct herself appropriately in court. “[B]ipolar disorder, standing alone, does not preclude a competent waiver of counsel without some additional showing the defendant is mentally incompetent to represent herself.” Cudjo v. State, 345 S.W.3d 177, 187 (Tex. App.—Houston [14th Dist.] 2011, pet. ref’d) (affirming determination of competence to waive counsel although appellant suffered from bipolar disorder and was housed in prison mental health unit, but could communicate clearly, conduct himself appropriately, ask coherent questions, lodge objections, and articulate defenses to allegations); but cf. Chadwick, 309 S.W.3d at 562 (trial court did not abuse discretion in denying right to self-representation when appellant put curses on trial court, interrupted his attorney, launched into rambling monologues and personal attacks, and filed incoherent motions). Here, the trial court interacted with Downes on several occasions after she was deemed competent to stand trial, in addition to the August Faretta hearing. These interactions provided the court with ample information to take “realistic account” of Downes’ mental competence to 6 The docket indicates that the trial court ordered a competency evaluation on January 27, 2011. Thereafter, on February 24, 2011, the trial court found Downes “not competent to stand trial at this time.” 10 conduct her own defense. See Edwards, 554 U.S. at 177. Additionally, the trial court provided Downes with standby counsel to consult at any point before or during the trial. 7 We must give almost total deference to the trial court’s rulings on mixed questions of law and fact when the resolution of the issue turns on an evaluation of credibility and demeanor. Further, the trial court was in the best position to evaluate whether Downes manifested a severe mental illness that would render her incompetent to proceed pro se. See id.; Chadwick, 309 S.W.3d at 561. Construing the evidence in the light most favorable to the trial court’s ruling, we conclude that the trial court did not abuse its discretion in impliedly finding that Downes was competent to waive counsel and proceed pro se. See Chadwick, 309 S.W.3d at 561. II. Downes’ Absence from Trial On June 10, 2013, Downes participated in the jury selection process, the jury was empaneled and sworn, and Downes entered her plea of not guilty. Prior to adjourning for the day, the trial court instructed Downes to be present in court at 8:50 the following morning prior to the commencement of trial. At 7:00 a.m. June 11, 2013, the trial court received an email from Downes stating that she was sick and could not make it to court. She asked that the case be postponed until the next 7 Here, Downes’ participation in the trial was limited to the jury selection process. To the extent Downes relies on her performance in that process to support her claim of mental incompetence, we note the trial court’s observation of this process did not result in a re-evaluation of the decision to permit Downes to represent herself. The fact that Downes’ performance could be described as less than effective merely reflects the fact that an untrained layperson is not typically equipped to step into the role of a trial attorney. 11 available date. 8 The court coordinator replied to Downes’ email at 7:02 a.m. stating, “Court will begin at 9:00, and you were told to be there at 8:50. It will not be canceled.” 9 Based on Downes’ representations to the trial court in the six months preceding trial that the trial was not going to happen, the trial court determined that Downes voluntarily absented herself from trial after pleading “not guilty” to the indictment. 10 Downes was tried in absentia 8 Downes’ email stated, I am very sick. This -- I’ll be unable to make it to court this a.m. I am really sorry. I have been sick all night. It’s not like me to be sick. I guess I have a stomach flu. Have actually been sick three times since February due to stress. I am so sorry, but I can’t make it. I can’t take the heat on top of it. My car has no AC. I will cancel the jury for this week, sequester the jury, and we can pick this up the next available date. It takes me two or three days to feel human again. I don’t feel human at all at this moment. I’m going back to sleep. I feel really rotten. I will e-mail you later to check in. Thanks, Sharon Downes. 9 Standby counsel also emailed Downes and left a message on her telephone answering machine regarding attendance at trial, but received no response. 10 The court indicated, [This court has] received numerous letters from Ms. Downes in the last six months. Last week, on more than one occasion, she told me she was not coming, in writing. She made statements the trial was not going forward, it would be fatal. She gave me the excuse in April because of the explosion at the plant in West on I-35 -- she’s coming on I-45 from Houston -- that due to the fumes, I-45 was not clear. My coordinator called TxDOT, and there were no warnings or any cause for concern on 45. And she did not come that day, and that was April 18th. She started in January saying that she was not coming. At the end of January, I set the trial for this week, accommodating that she advised the Court she was taking college classes and asked for the court to be after this semester ended. She has made numerous statements in court and in writing to the Court, and all of these writings are in the Court’s file, the trial was not come-- was not happening, she needed dismissal, she wasn’t coming, she’s on the edge of threatening Ms. Sessions. Last week, she was extremely racial in her comments. And the Court, pursuant to the Texas Code of Criminal Procedure 33.03, can go forward when the defendant voluntarily absents himself after pleading to the indictment or information or after the jury has been selected when the trial is before a jury. Pursuant to Texas Code of Criminal Procedure 37.06, in a felony case, the defendant must be present when the verdict is read unless his absence is willful or voluntary. Based on the last six months, if not longer, Ms. Downes has stated in court and in writing the trial wasn’t going to happen, I’m not coming, it’s fatal. She tried last week for a, at least, third time, to postpone with a change of venue and a motion to recuse that the Administrative Judge of the First Region ruled upon late last week. 12 and was arrested the following day in a hotel located approximately two-to-three hours from the Houston County courthouse. On appeal, Downes claims the trial court abused its discretion in determining that her absence from trial was voluntary. Article 33.03 of the Texas Code of Criminal Procedure provides, In all prosecutions for felonies, the defendant must be personally present at the trial, . . . provided, however, that in all cases, when the defendant voluntarily absents [her]self after pleading to the indictment or information, or after the jury has been selected when trial is before a jury, the trial may proceed to its conclusion. TEX. CODE CRIM. PROC. ANN. art. 33.03 (West 2006). Whether the trial court erred in proceeding with the trial is reviewed under an abuse of discretion standard. Moore v. State, 670 S.W.2d 259, 261 (Tex. Crim. App. 1984). In most instances, the appellate court must determine, from hindsight, the validity of the trial court’s determination that the defendant’s absence was voluntary. Id.; Hudson v. State, 128 S.W.3d 367, 375–76 (Tex. App.—Texarkana 2004, no pet.). The defendant must provide evidence to refute the trial court’s determination, or we will not disturb the trial court’s finding. Hudson, 128 S.W.3d at 375–76. As we have noted, Downes was present when the jury was selected and sworn in and when the judge recessed court for the day and announced when the trial would resume. Downes accounted for her failure to appear, but the trial court, based on information in the record, did not find this story credible. Instead, the trial court found that Downes’ absence was voluntary. Here, The Court in good conscience cannot say Ms. Downes is sick. The court finds that Ms. Downes is voluntarily absenting herself from today’s proceedings, and we are going forward. 13 the trial court had some evidence before it to support the conclusion that Downes’ absence was voluntary. See Moore, 670 S.W.2d at 261. Indeed, the record reflects a pattern of Downes’ delay tactics; she even boldly declared on several occasions that there would be no trial. In January 2013, Downes filed a motion to recuse the trial court judge, which was denied by Senior District Judge, Gene Knize. 11 In April 2013, Downes’ case was set for a motions hearing. On the day before the scheduled hearing, Downes sent an email to the trial court asking to participate via conference call. The trial court determined that Downes was to appear in person, and this information was communicated to Downes via email correspondence on the day prior to the hearing. The following day—the date of the hearing—Downes emailed a motion for continuance (referring to same as “a quick informal motion for continuance”) due to “the explosion and amonia [sic] spread in the I-45 North area.” That same morning, Downes was informed that the motion for continuance was denied. 12 The docket indicates that the trial court called Downes six times at the number she provided before hearing the motion for continuance. Downes emailed a second motion for continuance to the trial court in May 2013. This motion was likewise denied. On receipt of this denial, Downes wrote the trial court a letter indicating, “This document serves as official notice or TRIAL PROTEST by Defendant Pro Se who will not be [sic] NOT appear in court on June 10 for the trial in Petition and Protest of Cause No: 10CR270 . . . .” Downes further stated, “Trial will not be had and will be stopped if 11 Downes had previously filed a motion to recuse in August 2011, which was also denied by Judge Knize. 12 A handwritten note appears in the record: “Called Jan at TxDOT -- no advisory for I-45 -- only traffic delays on I- 35.” 14 in progress.” Demonstrating her intention to stop the trial, Downes wrote, “Let me make it very clear I will not appear in court on June 10, 2013[,] to continue to be abused by the staff. I will stop any trial during the proceeding and I do mean STOP IT.” Downes concluded, “CANCEL THE JURY AND WITNESSES THERE WILL BE NO TRIAL FOR CAUSE NO. 10CR270 JUNE 10, 2013.” Thereafter, Downes engaged in delaying tactics including the June 4, 2013, filing of a motion to recuse both the prosecuting attorney and the trial court. 13 On June 7, Downes emailed the trial court’s docket coordinator informing her that the referenced recusal motion had been filed and asking if the motion was set for hearing on June 10 at 9:00 a.m.—the scheduled trial date. At the conclusion of this e-mail, Downes stated, “I am only appearing in court if the above items will be met or a Straight DISMISSAL with no conditions at all. I will only sign Dismissal documents and not one additional thing.” Downes was informed that her recusal motion had been forwarded to the presiding judge of the First Administrative Judicial Region. Additionally, the court sent Downes the following notice on Friday, June 7: “[The] Court has set your case for trial and has ordered you to appear on Monday, June 10, 2013[,] at 9:00 a.m. to begin trial.” Downes’ email reply stated, among other things, “I am NOT coming unless my case is guaranteed to be dismissed because it will be a waste of my money which I do not have.” Downes was then informed that the administrative law judge had “responded that jury trial shall proceed on Monday, June, 10, 2013[,] at 9:00 a.m.” Downes informed the docket coordinator 13 This was the third motion Downes filed to recuse the trial court. 15 that she had not told her family about the trial because she hoped it would go away. Downes further advised, “It needs to be dismissed.” It was against this backdrop that the trial court understandably looked askance on Downes’ absence from trial due to a purported illness. Downes’ standby counsel attempted to contact Downes by telephone and by email after the court received word from Downes that she would not be present for trial. Counsel received no response from Downes. The trial commenced at 9:58 a.m., almost an hour later than scheduled. When the trial concluded, the court recessed until Downes could be arrested and brought to court. 14 Downes was located and arrested at a hotel in Webster, Texas, on June 12. The hotel address did not match Downes’ home address in Liverpool, Texas. On her return to court, Downes stated that she did not have money for a hotel in Houston County and that the drive was too long for her. Downes failed to explain how she was then able to afford a hotel room in Webster, Texas, located approximately three hours (in heavy traffic conditions) from the Houston County courthouse. Lynn Gentry, a deputy with the Houston County Sheriff’s Department, testified that he transported Downes from Webster back to the Houston County courthouse on June 12. Gentry testified that Downes was in good physical condition when he picked her up. Downes did not 14 On the evening of June 11, after the conclusion of the trial, Downes sent one additional email to the docket coordinator, stating that she was taking an EMERGENCY INDEFINATE [sic] MEDICAL LEAVE OF ABSENCE from the court . . . effective immediately. I can’t do this right now I am exhausted and really physically sick. I was sick all night, & today vomiting do [sic] to exhaustion, caused by long term severe stress. I slept all day until I called you @ 4:00 pm. It wore me out getting up @ 3:00 a.m., to be in court by 9am. I will not be able to do that anymore for any reason. I WILL NOT BE IN COURT TOMORROW OR THURSDAY. 16 become ill on the drive to Houston County, and Gentry did not observe Downes exhibit any symptoms of illness. Downes told Gentry that she did not feel good, that she was exhausted, and that she had slept all day. Nontheless, Gentry indicated that Downes appeared to be fine with no physical ailments. Downes testified that she had no idea that the case would be tried in her absence when she called in sick. She explained that she had no intention of inconveniencing anybody, but that she thought she should be entitled to a sick day from court. Downes explained that she slept the entire day in order to feel better. She stated that she did not go to the emergency room because it would not have helped and because she could not have gotten any rest there. 15 Downes indicated that she understood why the trial court would think she was feigning illness after Downes indicated, on several occasions, that there would be no trial, that the trial would be stopped in progress, and that Downes wanted nothing but a dismissal of her case. The trial court determined that Downes’ was not hospitalized, kidnapped, threatened, or harmed; she was, instead, sleeping in her hotel room. The trial court told Downes, “[I]f you would not have sent me letters over and over ‘I’m not coming,’ ‘This trial’s not going forward,’ ‘It’s going to be postponed,’ . . . [then] what you have sent me in an e-mail saying that you were sick I would have looked on differently.” Although Downes presented evidence attempting to explain her absence, we cannot say that the evidence presented refutes the trial court’s determination that her absence was voluntary. The evidence clearly reflects that Downes’ stated intention was to stop the trial from taking 15 The trial court asked Downes if she was competent to stand trial, and Downes again explained that she was tired. The trial court tested this question by having Downes identify the various players in her trial and define their roles. 17 place. The most recent pronouncement of such intention was only days before Downes did not appear for her trial. Although Downes claimed to be ill, she did not require medical attention, and the deputy who arrested her and brought her to the courthouse following her failure to appear for trial testified that Downes appeared to be in good physical condition and that he observed no signs of illness. Because we find no abuse of discretion, we will not disturb the trial court’s finding. See, e.g., Bottom v. State, 860 S.W.2d 266, 267 (Tex. App.—Fort Worth 1993, no pet.) (continuing trial in absence of defendant, who was hospitalized due to suicide attempt, was not abuse of discretion; defendant was present when jury was selected). 16 III. Conclusion We affirm the judgment of the trial court. Jack Carter Justice Date Submitted: May 28, 2014 Date Decided: July 2, 2014 Do Not Publish 16 Downes relies on Kerr v. State, 83 S.W.3d 832 (Tex. App.—Texarkana 2002, no pet.), to suggest that her due process rights were violated. Kerr involved a defendant who absented himself before the jury had been selected. Under these circumstances, the trial court erred in proceeding with the trial in Kerr’s absence. Id. at 834. 18	{ "pile_set_name": "FreeLaw" }
774 F.2d 1166 U.S.v.Merhebi 84-2010 United States Court of Appeals,Seventh Circuit. 7/31/85 1 N.D.Ill. AFFIRMED	{ "pile_set_name": "FreeLaw" }
Nebraska Supreme Court Online Library www.nebraska.gov/apps-courts-epub/ 11/21/2017 09:15 AM CST - 272 - Nebraska Court of A ppeals A dvance Sheets 25 Nebraska A ppellate R eports BERNDT v. BERNDT Cite as 25 Neb. App. 272 Scott Berndt, appellee, v. Tonya Berndt, now known as Tonya DiPasquale-M artinez, appellant. ___ N.W.2d ___ Filed November 14, 2017. No. A-16-1109. 1. Modification of Decree: Appeal and Error. Modification of a dis- solution decree is a matter entrusted to the discretion of the trial court, whose order is reviewed de novo on the record, and which will be affirmed absent an abuse of discretion by the trial court. 2. Divorce: Modification of Decree: Visitation. Visitation rights estab- lished by a marital dissolution decree may be modified upon a showing of a material change of circumstances affecting the best interests of the children. 3. Modification of Decree: Words and Phrases. A material change in circumstances means the occurrence of something which, had it been known to the dissolution court at the time of the initial decree, would have persuaded the court to decree differently. 4. Visitation. The party seeking to modify visitation has the burden to show a material change in circumstances affecting the best interests of the child. 5. ____. The best interests of the children are primary and paramount con- siderations in determining and modifying visitation rights. 6. Modification of Decree: Child Custody: Proof. In a child custody modification case, first, the party seeking modification must show a material change in circumstances, occurring after the entry of the previ- ous custody order and affecting the best interests of the child. Next, the party seeking modification must prove that changing the child’s custody is in the child’s best interests. 7. Child Custody. While the wishes of a child are not controlling in the determination of custody, if a child is of sufficient age and has expressed an intelligent preference, the child’s preference is entitled to consideration. - 273 - Nebraska Court of A ppeals A dvance Sheets 25 Nebraska A ppellate R eports BERNDT v. BERNDT Cite as 25 Neb. App. 272 8. Modification of Decree: Child Custody: Appeal and Error. In a child custody modification case, an appellate court, in its de novo review, can make a best interests of the child finding if the evidence supports it. 9. Child Custody. In determining the best interests of a child in a custody determination, a court must consider pertinent factors, such as the moral fitness of the child’s parents, including sexual conduct; respective envi- ronments offered by each parent; the age, sex, and health of the child and parents; the effect on the child as a result of continuing or disrupt- ing an existing relationship; the attitude and stability of each parent’s character; and parental capacity to provide physical care and satisfy educational needs of the child. Appeal from the District Court for Sheridan County: Travis P. O’Gorman, Judge. Reversed and remanded with directions. Desirae M. Solomon for appellant. Bell Island, of Island Law Office, P.C., L.L.O., for appellee. Inbody, Pirtle, and R iedmann, Judges. Pirtle, Judge. INTRODUCTION Tonya Berndt, now known as Tonya DiPasquale-Martinez, appeals from an order of the district court for Sheridan County denying her complaint to modify visitation with her children. Based on the reasons that follow, we reverse, and remand with directions. BACKGROUND Tonya and Scott Berndt were divorced by a decree of dis- solution on November 30, 2012. The parties have two minor children, Sevanna Berndt, born in 2005, and Tobias Berndt (Toby), born in 2007. The parties entered into a property settlement and custody agreement, which was approved by the court. Pursuant to the custody agreement, the parties had joint legal and physical custody. The parties agreed that the children would primarily reside with Scott. Tonya had par- enting time every weekend, except on the third weekend of - 274 - Nebraska Court of A ppeals A dvance Sheets 25 Nebraska A ppellate R eports BERNDT v. BERNDT Cite as 25 Neb. App. 272 each month. The parties alternated holidays, and Tonya was awarded parenting time during the summer break, except for 4 weeks which were awarded to Scott. On January 25, 2016, Tonya filed a complaint to modify visitation, alleging that since the entry of the decree, there had been a material change in circumstances affecting the best interests of the children. Tonya alleged that the material change in circumstances were that she has a residence in Gordon, Nebraska, and the ability to have regular and continuous con- tact with the children; the current schedule creates confusion and disagreements between the parties; and the children have expressed a desire to spend more time with her. She sought an order modifying the parenting time to a “week on/week off” schedule, meaning parenting time would alternate between the parties on a weekly basis. Trial on Tonya’s complaint to modify was held on October 18, 2016. The evidence showed that at the time of the divorce, Scott was living on a ranch near Lakeside, Nebraska. The ranch is 36 miles from Gordon. At the time of the hearing on the complaint to modify, Scott continued to live at the ranch with the children and his new wife. At the time of the divorce, Tonya was awarded the parties’ home in Gordon, but she was living in Kimball, Nebraska. She would commute to Gordon for her parenting time. In March 2013, Tonya moved to Gordon and lived in the marital home. In January 2014, she moved to Cheyenne, Wyoming, and subsequently remarried. Since January 2014, Tonya has been commuting from Cheyenne to Gordon for her parenting time. She sold the marital home in Gordon, and she and her husband bought a different home in Gordon. She continues to exercise most of her parenting time in Gordon, but she occasionally takes the children to Cheyenne. Tonya testified that she exer- cises a large part of her parenting time in Gordon so the chil- dren can participate in sports and other activities. Tonya often spends time in Gordon in addition to the time she is there for her scheduled parenting time. - 275 - Nebraska Court of A ppeals A dvance Sheets 25 Nebraska A ppellate R eports BERNDT v. BERNDT Cite as 25 Neb. App. 272 Tonya testified that she and her husband have a “dual residence,” and her husband testified likewise. They live in Cheyenne the majority of the time, and both described Cheyenne as their primary residence. Tonya has two older children from another relationship that both live in Cheyenne. At the time of trial, one was in high school and the other had reached the age of majority and was living on her own. When the decree was entered, Sevanna and Toby were attending a country school located 11 miles from Scott’s ranch and 30 miles from Gordon. During the 2013-14 and 2014-15 school years, the children attended school in Lakeside, which then closed at the end of the 2014-15 school year. The children began attending school in Gordon and Rushville, Nebraska, during the 2015-16 school year. They were attending the same school district at the time of trial. Toby’s elementary school was located in Gordon, and Sevanna’s middle school was located in Rushville. Sevanna would take a bus to school that left from the high school parking lot in Gordon and returned to the same parking lot at the end of the schoolday. Tonya’s home in Gordon is located 11⁄2 blocks from Toby’s school and 4 blocks from the high school in Gordon. Tonya testified that during the 2015-16 school year, she spent time in Gordon during the week because she wanted to be close by the children in case they needed a “snack” or a “place to go” after school. She also testified that she was often in Gordon during the week because she was renovating her home. Tonya testified that Toby has had some issues at school because of his “ethnicity.” She stated that the children are “multiracial” and that she feels they “had been a product of some comments that have been said.” She testified that she believes it is important that she is there to help the children when they face these issues and it is important that the chil- dren are aware of their “full diverse culture.” Sevanna and Toby both participate in various sports and are involved in 4-H. Tonya and Scott both attend the children’s sporting events and activities and help the children with their - 276 - Nebraska Court of A ppeals A dvance Sheets 25 Nebraska A ppellate R eports BERNDT v. BERNDT Cite as 25 Neb. App. 272 4-H projects. During the week, Scott gets the children to and from school as well as to their activities. On the weekends, Tonya gets the children to and from their activities. Both par- ties are also involved in their children’s schooling, including helping with homework. The evidence showed that for the most part, the parties have worked well together regarding the children. They were gener- ally able to communicate about the children’s activities and weekend exchanges if there was a conflict. There have been some disputes regarding Scott’s parenting time on the third weekend of the month, mostly during times when those week- ends fall on a holiday. Tonya testified that a week on/week off parenting time arrangement would provide stability, be “less back and forth,” alleviate frustration in communication, and alleviate disputes over Scott’s weekend visitation. She further testified that she would have more bonding time with the children and would be able to participate in their everyday lives. Tonya stated that her parenting time would continue to take place in Gordon. Scott testified that he was opposed to a week on/week off arrangement, because the children need consistency and he thought it would be detrimental to the children. Sevanna also testified at trial. She expressed a desire to spend more time with Tonya and stated she would prefer an alternating weekly parenting schedule. She testified that when she is at her father’s house during the week, she and her mother send messages back and forth on Facebook almost daily, starting when she gets home after school and continuing throughout the evening. She also testified that there are some issues and problems that she feels more comfortable talking to her mother about. She testified that she loves both parents equally and would like to spend an equal amount of time with them. The trial court found that Tonya had failed to prove a mate- rial change in circumstances occurred which affected the best interests of the children. It noted that at the time of the decree, - 277 - Nebraska Court of A ppeals A dvance Sheets 25 Nebraska A ppellate R eports BERNDT v. BERNDT Cite as 25 Neb. App. 272 Tonya lived in Kimball and was commuting for her parenting time, having it occur in Gordon. At the time of trial, she con- tinued to travel for her parenting time, with the distance from Cheyenne being greater than it was from Kimball. The court found that the only change since the decree was Sevanna’s desire to spend more time with Tonya and that this alone did not constitute a material change in circumstances. The court determined that there was insufficient evidence to show a material change in circumstances had occurred which affected the best interests of the children, and it denied Tonya’s motion to modify visitation. ASSIGNMENTS OF ERROR Tonya assigns that the trial court erred in (1) failing to find that a material change in circumstances had occurred since the entry of the decree and (2) failing to find that it was in the children’s best interests to modify the parenting plan to an alternating weekly schedule. STANDARD OF REVIEW [1] Modification of a dissolution decree is a matter entrusted to the discretion of the trial court, whose order is reviewed de novo on the record, and which will be affirmed absent an abuse of discretion by the trial court. Hopkins v. Hopkins, 294 Neb. 417, 883 N.W.2d 363 (2016). ANALYSIS [2-5] Visitation rights established by a marital dissolu- tion decree may be modified upon a showing of a material change of circumstances affecting the best interests of the children. Mark J. v. Darla B., 21 Neb. App. 770, 842 N.W.2d 832 (2014). A material change in circumstances means the occurrence of something which, had it been known to the dissolution court at the time of the initial decree, would have persuaded the court to decree differently. Id. The party seek- ing to modify visitation has the burden to show a material change in circumstances affecting the best interests of the - 278 - Nebraska Court of A ppeals A dvance Sheets 25 Nebraska A ppellate R eports BERNDT v. BERNDT Cite as 25 Neb. App. 272 child. Id. The best interests of the children are primary and paramount considerations in determining and modifying visi- tation rights. Id. [6] In a child custody modification case, first, the party seeking modification must show a material change in cir- cumstances, occurring after the entry of the previous custody order and affecting the best interests of the child. Next, the party seeking modification must prove that changing the child’s custody is in the child’s best interests. Hopkins v. Hopkins, supra. Tonya first assigns that the trial court erred in failing to find that a material change in circumstances had occurred since the entry of the decree. The trial court found that the only change since the decree was Sevanna’s desire to spend more time with Tonya. Sevanna was 11 years old at the time of trial. She testified in court expressing her desire to spend more time with Tonya and stated she would prefer an alternating weekly parenting schedule. She indicated that the amount of time she spends with Tonya is not enough “[b]ecause she like takes good care of us and she’s our mom and — you know, yeah.” She also testified that there are some issues and problems that she feels more comfortable talking to her mother about. She testified that when she is at her father’s house during the week, she and her mother send messages back and forth on Facebook almost daily, starting when she gets home after school and continu- ing throughout the evening. She testified that an equal amount of time with her parents would be good for her “[b]ecause [she] would get to see both [her] parents equal time and it would work out with like sports and stuff too.” Sevanna fur- ther indicated that spending equal time was important to her “[b]ecause I love my parents both equally and it’s just fun being around them.” [7] While the wishes of a child are not controlling in the determination of custody, if a child is of sufficient age and has expressed an intelligent preference, the child’s preference - 279 - Nebraska Court of A ppeals A dvance Sheets 25 Nebraska A ppellate R eports BERNDT v. BERNDT Cite as 25 Neb. App. 272 is entitled to consideration. See Floerchinger v. Floerchinger, 24 Neb. App. 120, 883 N.W.2d 419 (2016). Further, in cases where the minor child’s preference was given significant con- sideration, the child was usually over 10 years of age. Id. The trial court considered Sevanna’s desire to spend more time with Tonya and concluded that her desire alone did not constitute a material change in circumstances. However, the trial court failed to recognize other changes that have occurred since the decree. When the decree was entered in November 2012, Scott was living near Lakeside and Tonya was living in Kimball and commuting to Gordon for parenting time. The children were attending a country school that was 30 miles from Gordon and 11 miles from Scott’s residence. At the time of the modification trial, Tonya was living in Cheyenne, but also had a different home in Gordon where she was spending a large amount of time. The children were attending school in Gordon and Rushville. Gordon is 36 miles from Scott’s residence. Tonya’s home in Gordon was within blocks of Toby’s elementary school and the high school park- ing lot from which Sevanna was transported via bus to and from the middle school in Rushville. Tonya was not working, which allowed her to be in Gordon during the week, in addi- tion to when she was there for parenting time. The children were involved in various sports and activities in Gordon, which resulted in them spending a large amount of time in Gordon. It also resulted in a lot of driving back and forth during the week between Gordon and Scott’s residence, each way being 36 miles. We conclude that the change in the children’s schools, the location of Tonya’s Gordon home and Scott’s home in rela- tion to the children’s schools, and Tonya’s availability dur- ing the week, are all changes that have occurred since the decree. When these changes are considered in conjunction with Sevanna’s desire to spend more time with Tonya, they result in a material change in circumstances. Accordingly, the - 280 - Nebraska Court of A ppeals A dvance Sheets 25 Nebraska A ppellate R eports BERNDT v. BERNDT Cite as 25 Neb. App. 272 trial court abused its discretion in finding that there was insuf- ficient evidence to show a material change in circumstances had occurred. [8] Tonya also assigns that the trial court erred in failing to find that it was in the children’s best interests to modify the parenting time. The trial court did not address the children’s best interests because it found there was no material change in circumstances. However, in our de novo review, we can make a best interests finding if the evidence supports it. See Parker v. Parker, 234 Neb. 167, 449 N.W.2d 553 (1989). We deter- mine that the evidence is sufficient to make a best interests finding in this case. [9] Neb. Rev. Stat. § 43-2923(6) (Reissue 2016) provides that in determining custody and parenting arrangements: [T]he court shall consider the best interests of the minor child, which shall include, but not be limited to, consid- eration of . . . : (a) The relationship of the minor child to each parent prior to the commencement of the action or any subse- quent hearing; (b) The desires and wishes of the minor child, if of an age of comprehension but regardless of chrono- logical age, when such desires and wishes are based on sound reasoning; (c) The general health, welfare, and social behavior of the minor child; (d) Credible evidence of abuse inflicted on any family or household member. . . ; and (e) Credible evidence of child abuse or neglect or domestic intimate partner abuse. Other pertinent factors include the moral fitness of the child’s parents, including sexual conduct; respective environments offered by each parent; the age, sex, and health of the child and parents; the effect on the child as a result of continuing or disrupting an existing relationship; the attitude and stabil- ity of each parent’s character; and parental capacity to provide - 281 - Nebraska Court of A ppeals A dvance Sheets 25 Nebraska A ppellate R eports BERNDT v. BERNDT Cite as 25 Neb. App. 272 physical care and satisfy educational needs of the child. Robb v. Robb, 268 Neb. 694, 687 N.W.2d 195 (2004). The evidence shows that the children have a good relation- ship with both parents. Both parents are actively involved in the children’s homework and their extracurricular activities. The parties are able to communicate about the children’s activities and exchanges, and they have generally worked well together regarding the children. As previously discussed, Sevanna wants to spend more time with Tonya. She feels more comfortable talking to her mother about certain topics. She communicates with her mother via Facebook almost daily when she is at her father’s house. The week on/week off parenting arrangement will allow Sevanna more time with Tonya and will give her more face-to-face communication. Further, the modified sched- ule will allow the children to be close to their schools and activities during the weeks that Tonya has them. It also will give the children the opportunity to have both parents involved in their day-to-day activities. Upon our de novo review, we find that modifying custody to a week on/week off parenting schedule is in the children’s best interests. CONCLUSION We conclude that the trial court abused its discretion in finding that there was insufficient evidence to show a material change in circumstances had occurred which affected the best interests of the children. Accordingly, the trial court erred in denying Tonya’s complaint to modify visitation. We reverse the trial court’s order and remand the cause with directions for the district court to enter a modification order and parenting plan consistent with this opinion. R eversed and remanded with directions.	{ "pile_set_name": "FreeLaw" }
10 So.3d 641 (2009) RIERA v. FERNANDEZ. No. 3D08-3229. District Court of Appeal of Florida, Third District. June 23, 2009. Decision without published opinion Vol. dismissed.	{ "pile_set_name": "FreeLaw" }
106 F.3d 1544 1997 A.M.C. 1708, 10 Fla. L. Weekly Fed. C 752 NATIONAL SHIPPING COMPANY OF SAUDI ARABIA, Plaintiff-Appellant,v.OMNI LINES, INC., Defendant-Third-Party Plaintiff-Appellee,Exchange Transportation International, Inc., Third-PartyDefendant-Appellee. No. 95-6691. United States Court of Appeals,Eleventh Circuit. March 6, 1997. Susan L. Howick, Richard C. Litwin, Atlanta, GA, for Plaintiff-Appellant. William M. Moore, Mobile, AL, for Defendant-Third-Party Plaintiff-Appellee. Appeal from the United States District Court for the Southern District of Alabama. Before ANDERSON, Circuit Judge, and KRAVITCH and HENDERSON, Senior Circuit Judges. KRAVITCH, Senior Circuit Judge: 1 National Shipping Company of Saudi Arabia ("NSCSA") appeals the district court's judgment following a bench trial in favor of Omni Lines, Inc. ("Omni"). NSCSA, as a freight carrier, argued that where a shipper pays freight charges due under a bill of lading to a freight forwarder but the forwarder never pays the carrier, the shipper remains liable to the carrier for the unpaid freights. The district court rejected NSCSA's contention. On appeal, we review the district court's factual rulings for clear error and its legal conclusions de novo. Newell v. Prudential Ins. Co., 904 F.2d 644, 649 (11th Cir.1990). We reverse. I. 2 Acting through a freight forwarder, Exchange Transport International ("Exchange"), the parties arranged for the carriage of newsprint from St. John, Canada to Jedda, Saudi Arabia. Specifically, NSCSA transported the newsprint pursuant to a bill of lading listing Omni as the shipper. The freight charge on the bill totaled $67,794.62 and the bill was marked "Freight Prepaid." Despite marking the bill prepaid, NSCSA claims--and Omni does not dispute--that the bill was never paid. Although Exchange issued an invoice to Omni for the freight charges, which Omni promptly paid, Exchange did not pay NSCSA and instead applied Omni's payment to its own outstanding debts. Exchange since has gone out of business and NSCSA's attempts to collect from Exchange have been fruitless. NSCSA therefore brought the instant action, alleging that Omni remains liable under the bill of lading for the unpaid freights. II. 3 As an initial matter, we note that any result we reach in this case necessarily will be somewhat inequitable. Neither party to the instant suit has done other than what it was expected to do; NSCSA transported the goods as arranged by Exchange, and Omni paid Exchange when billed. Thus, we must decide whether Omni must be made to pay twice or whether NSCSA is not paid at all. 4 Perhaps because of this Hobson's choice, courts have adopted varying approaches to cases where a carrier issues a "freight prepaid" bill of lading even though it has not yet been paid, the shipper pays the freight forwarder, and the forwarder fails to pay the carrier. Some courts ask whether the use of the term "freight prepaid," in the specific circumstances of the case, was meant to act as an extension of credit by the carrier to the forwarder, in which case the carrier's only recourse is against the forwarder, or was an extension of credit to the shipper, in which case the shipper remains liable on the bill.1 Indeed, this court has noted that such evidence of local custom can create shipper liability. In Naviera Neptuno S.A. v. All International Freight Forwarders, Inc., 709 F.2d 663, 665 (11th Cir.1983), we reversed summary judgment for a shipper and remanded for the district court to determine whether local custom was to treat the "freight prepaid" notation as an extension of credit from the carrier to the shipper. If so, we held, the shipper could be held liable for freight charges, even though the shipper had paid a freight forwarder in full. 5 NSCSA argues that Naviera governs this case, based on its claim that it introduced, at trial, unrefuted evidence of a local custom viewing "freight prepaid" as an extension of credit from the carrier to the shipper. We disagree. NSCSA's proof at trial did not indicate whether the use of the term "freight prepaid" on the bill of lading allocated--between NSCSA and Omni--the risk of loss due to the forwarder's failure to pay the carrier. Rather, NSCSA's revenue controller, Saniisha Williams, testified that marking a bill of lading "freight prepaid" is a way of indicating that the freight will be paid at the point where the cargo is loaded, not the point of delivery.2 Consequently, although we recognize our prior precedent, we conclude that this case is not controlled by it. We therefore consider the liability rules crafted by other courts to deal with the situation where a local custom is unproven. 6 Some courts have "held that the equitable estoppel doctrine bar[§ carriers] from recovering freight charges where [the shippers] were justified in believing that [the carriers] had been paid for their services." Olson Distributing Sys., Inc. v. Glasurit America, Inc., 850 F.2d 295, 296 (6th Cir.1988).3 These courts reason that it would be inequitable to hold a shipper liable if it justifiably relied on the "freight prepaid" notation, in addition to other objective indications that the carrier viewed the freight forwarder as ultimately being liable for charges due under the bill of lading. 7 By contrast, there are cases leaning towards a semi-strict liability for shippers. These decisions indicate that unless the carrier intends to release the shipper from its duty to pay under the bill of lading, the shipper remains liable to the carrier, irrespective of the shipper's payment to a freight forwarder. We find support for this doctrine in dicta from this court's predecessor: 8 Of course it makes a lot of difference whether this is really a suit by the Carrier. If it is a suit by the Carrier, we can assume that by virtue of its filed tariffs expressly incorporating its bill of lading contract, conduct by the Carrier--no matter how inequitable--cannot excuse it from enforcing collection of freight, nor can harm innocently suffered by the Shipper--occasioned by the wrongdoing of another (the Agent)--excuse it from paying the Carrier even though this means payment twice. That would follow from the rigorous policy which, to prohibit not only discrimination but the possibility of it, gives to carrier tariffs the force of law. 9 Compania Anonima Venezolana De Navegacion v. A.J. Perez Export Co., 303 F.2d 692, 695-96 (5th Cir.), cert. denied, 371 U.S. 942, 83 S.Ct. 321, 9 L.Ed.2d 276 (1962) (footnotes omitted).4 Subsequently, the Fifth Circuit adopted a rule which, although not as severe as its prior opinion foreshadowed, still views shipper liability as the default rule. In Strachan Shipping Co. v. Dresser Indus., Inc., 701 F.2d 483 (5th Cir.1983), the court held that bills of lading marked prepaid did not relieve a shipper of liability unless the shipper could demonstrate that the carrier released it.5 10 Upon consideration, we believe that the Strachan approach--the shipper is liable unless released by the carrier--is the best rule. The district court relieved Omni of liability because it found that NSCSA, by using the words "freight prepaid," extended credit to Exchange, not to Omni. We hold that this conclusion was error because, although an extension of credit from the carrier to the shipper is one way to make the shipper liable, it is not the only way. After all, the bill of lading is a contract between the carrier and the shipper and the carrier has a contractual right to expect payment pursuant to that bill. Should the shipper wish to avoid liability for double payment, it must take precaution to deal with a reputable freight forwarder or contract with the carrier to secure its release. In adopting the same standard we do today, the Fifth Circuit noted that there are legitimate policy reasons for adopting a rebuttable presumption in favor of shipper liability: 11 [W]e think that our result comports with economic reality. A freight forwarder provides a service. He sells his expertise and experience in booking and preparing cargo for shipment. He depends upon the fees paid by both shipper and carrier. He has few assets, and he books amounts of cargo far exceeding his net worth. Carriers must expect payment will come from the shipper, although it may pass through the forwarder's hands. While the carrier may extend credit to the forwarder, there is no economically rational motive for the carrier to release the shipper. The more parties that are liable, the greater the assurance for the carrier that he will be paid. 12 Strachan, 701 F.2d at 490. We find this reasoning persuasive. 13 We cannot, however, say as a matter of law that NSCSA has or has not released Omni from its duty to pay. The use of the words "freight prepaid" appears to point towards release, as does the fact that NSCSA focused its initial collection efforts at Exchange. Nevertheless, both of these indications were present in Strachan, and the Fifth Circuit found that the shipper had not been released. Weighing against release, NSCSA claims that local custom views "freight prepaid" as an extension of credit to the shipper. We also note that the bill of lading itself does not favor finding release; it states: 14 Full freight to destination shall be considered completely earned upon receipt of the Goods at Point of Origin, whether the freight be stated or intended to be prepaid or to be collected at destination, and the Carrier shall be entitled to all freight and charges due hereunder, whether actually paid or not and to receive and retain them irrevocably under all circumstances whatsoever. 15 Bill of Lading at 2, § 15. Thus, we conclude that a factual issue remains for the trial court's resolution. Upon remand, the court should consider the foregoing--as well as other evidence--in applying the standard we have enunciated above.6 III. 16 Accordingly, we REVERSE the judgment of the district court and REMAND for further proceedings consistent with this opinion. 1 See, e.g., Compania Sud Americana de Vapores v. Atlantic Caribbean Shipping Co., 587 F.Supp. 410, 413 (S.D.Fla.1984) (holding that unless carrier produces evidence that "freight prepaid" means an extension of credit to the shipper, usual rule is that it is an extension of credit to the forwarder); Koninklijke Nedlloyd BV v. Uniroyal, Inc., 433 F.Supp. 121, 128 (S.D.N.Y.1977) (finding that carrier extended credit to forwarder); Farrell Lines, Inc. v. Titan Industrial Corp., 306 F.Supp. 1348, 1351 (S.D.N.Y.) (same), aff'd, 419 F.2d 835 (2d Cir.1969), cert. denied, 397 U.S. 1042, 90 S.Ct. 1365, 25 L.Ed.2d 653 (1970) 2 Ms. Williams twice referred to the phrase "freight prepaid" in her testimony: Freight prepaid--it was marked freight prepaid because it was to be paid on this side where the cargo originates, in the country of origin as opposed to collect where the consignee is responsible for paying the freight charges. We have two modes of payment. Either prepaid or collect. If a bill of lading is prepaid, the shipper is responsible for paying the charges on this side. If it's collect, the consignee pays the charge at the time of delivery. Freight prepaid means that the shipper of record is going to pay the charges either directly or through his agent, that the freight charges are going to be paid at the country of origin, or the area where the cargo is loaded. If a shipment goes freight collect, the consignee is responsible for paying the charges and the charges are paid at the time of the delivery of the goods. R-2 at 22-23. 3 See also Inman Freight Sys., Inc. v. Olin Corp., 807 F.2d 117, 121 (8th Cir.1986); Mediterranean Shipping Co. v. Elof Hansson, Inc., 693 F.Supp. 80, 84-85 (S.D.N.Y.1988) 4 See also Bartlett-Collins Co. v. Surinam Navigation Co., 381 F.2d 546, 549 (10th Cir.1967) (shipper liable on bill of lading "no matter how inequitable the conduct of the carriers") 5 See also Sea-Land Serv., Inc. v. Amstar Corp., 690 F.Supp. 246, 250 (S.D.N.Y.1988) (following Strachan ) 6 We also note that, should the district court find Omni liable, it must wrestle with the amount of its liability. It appears from the record that Exchange negotiated a $91.00/ton freight charge, but NSCSA billed Omni at a rate of $96.00/ton	{ "pile_set_name": "FreeLaw" }
744 N.W.2d 295 (2007) STATE v. GREGORY No. 2005AP1843. Court of Appeals of Wisconsin. December 19, 2007. Petition for review denied.	{ "pile_set_name": "FreeLaw" }
5 F.3d 365 UNITED STATES of America, Plaintiff-Appellee,v.William A. ROBERTS, Defendant-Appellant. No. 92-16660. United States Court of Appeals,Ninth Circuit. Submitted Aug. 13, 1993.Decided Sept. 16, 1993. William A. Roberts, pro se. Bradford C. Lewis, Asst. U.S. Atty., Sacramento, CA, for plaintiff-appellee. Appeal from the United States District Court for the Eastern District of California. Before SNEED, POOLE, and TROTT, Circuit Judges. SNEED, Circuit Judge: 1 William Roberts ("Roberts") appeals pro se the denial of his 28 U.S.C. Sec. 2255 motion. The primary issue is whether the district court violated Fed.R.Crim.P. 11 when it failed to advise Roberts of a term of supervised release at his plea hearing. We hold it did and vacate Roberts's sentence and remand to the district court with instructions. I. FACTS AND PRIOR PROCEEDINGS 2 Roberts owned Gemini Chemical, a chemical supply company, and was involved in buying and selling large quantities of precursor chemicals, as well as manufacturing and distributing the finished methamphetamine. On November 21, 1988, pursuant to a plea agreement, Roberts pled guilty to 21 U.S.C. Sec. 846, conspiracy to manufacture and distribute methamphetamine in violation of 21 U.S.C. Sec. 841(a). The charged conspiracy ran from July 23, 1987 to June 6, 1988. The plea agreement said the government would recommend that the court reduce Roberts's sentence by half if he cooperated with the government against others involved in manufacturing and distributing methamphetamine. The plea agreement also said if Roberts disobeyed the law--to be determined by a "probable cause" standard of proof--the agreement would be void. 3 At the plea hearing, the judge said Roberts would be sentenced under the "old law" because at that time the Ninth Circuit had held the Sentencing Guidelines to be unconstitutional and the Supreme Court had not yet decided the issue. The judge told Roberts the maximum penalty was twenty years. He did not say anything about a term of supervised release. 4 On February 21, 1989, Roberts was sentenced. By this time, the Supreme Court had decided Mistretta v. United States, 488 U.S. 361, 109 S.Ct. 647, 102 L.Ed.2d 714 (1989), which held the Sentencing Guidelines were constitutional, and Roberts was sentenced under the Guidelines. The report set forth a range of thirty years to life pursuant to the Sentencing Guidelines, so, under U.S.S.G. Sec. 5G1.1(a), Roberts was sentenced to the statutory maximum of twenty years. The judge also imposed a mandatory three year term of supervised release under the Guidelines. United States Sentencing Commission, Guidelines Manual, Sec. 5D3.1(a) (Oct. 1988). The Assistant U.S. Attorney ("AUSA") told the judge the government would ask that Roberts's sentence be reduced pursuant to the plea agreement "at the end of his cooperation." 5 In October 1988, Roberts began cooperating with state officers by making undercover purchases and sales of methamphetamine precursor chemicals. Beginning in March 1989, the agents began to receive information from informants and Roberts's employees that he was continuing to buy and sell precursor chemicals and methamphetamine for his own profit without the government's knowledge. Based on the information, the AUSA decided Roberts had broken the law and breached the agreement, and she did not move the court for a reduced sentence. 6 Roberts filed several motions challenging his conviction, including a motion to vacate pursuant to 28 U.S.C. Sec. 2255. The district court denied Roberts's Sec. 2255 motion, his motion for an evidentiary hearing, and his other motions.1 He filed a timely notice of appeal. II. JURISDICTION AND STANDARDS OF REVIEW 7 The district court had jurisdiction under 18 U.S.C. Sec. 3231 and 28 U.S.C. Sec. 2255. We have jurisdiction under 28 U.S.C. Sec. 2255 and 28 U.S.C. Sec. 1291. The decision whether to grant or deny a petition for habeas corpus is reviewed de novo. Adams v. Peterson, 968 F.2d 835, 843 (9th Cir.1992) (en banc). Findings of fact are reviewed for clear error. Thomas v. Brewer, 923 F.2d 1361, 1364 (9th Cir.1991). III. DISCUSSION 8 A. Violation of Fed.R.Crim.P. 11. 9 The voluntariness of a guilty plea is subject to de novo review. United States v. Signori, 844 F.2d 635, 638 (9th Cir.1988). Before accepting a guilty plea, the lower court judge must speak personally to the defendant to ensure his plea is voluntary. Fed.R.Crim.P. 11(d). Roberts argues his guilty plea was not voluntary because the court: 1) told him he would be sentenced under the "old law," not the Sentencing Guidelines, 2) failed to tell him he would not be eligible for parole, and 3) gave him a potentially longer sentence than the one he was advised of at his plea hearing. 10 1. The judge was not obligated to sentence him under pre-Guidelines law. 11 The first contention fails. The Sentencing Guidelines apply retroactively to guilty pleas, such as this one, which were entered in the "window period" between our decision suspending the Guidelines and the Supreme Court's holding in Mistretta that the Guidelines were constitutional. United States v. Ramos, 923 F.2d 1346, 1358 (9th Cir.1991). The Guidelines went into effect on November 11, 1987 and apply to conspiracies, such as this one, that ended after that date. United States v. Kohl, 972 F.2d 294, 298 (9th Cir.1992). The version of Rule 11 in effect at Roberts's November 21, 1988 plea hearing did not obligate the court to tell Roberts about the Sentencing Guidelines. Ramos, 923 F.2d at 1357. That the judge said he would be sentenced under the "old law" had no effect. United States v. Carey, 884 F.2d 547, 548 (11th Cir.1989), cert. denied, 494 U.S. 1067, 110 S.Ct. 1786, 108 L.Ed.2d 787 (1990). 12 2. Ineligibility for parole. 13 The judge did not violate Rule 11 by failing to advise Roberts that he would be ineligible for parole. Rule 11 does not require the trial court to notify a defendant of parole eligibility before accepting his guilty plea. United States v. Sanclemente-Bejarano, 861 F.2d 206, 209 (9th Cir.1988) (per curiam). 3. Failure to discuss supervised release.2 14 Rule 11 requires that the judge advise the defendant of the "maximum possible penalty" before accepting his guilty plea. Fed.R.Crim.P. 11(c)(1). Here, the judge violated Rule 11 because Roberts received a potentially longer sentence than the maximum he was advised of. At his November 21, 1988 plea hearing, the judge told Roberts that he faced a statutory maximum sentence of twenty years, a $1 million fine, and a mandatory penalty assessment of $50. 21 U.S.C. Sec. 841(b)(1)(C). The judge mentioned nothing about supervised release. At sentencing, Roberts received the twenty year maximum plus a three year term of supervised release pursuant to the Sentencing Guidelines. C.R. 35 at 20; U.S.S.G. Secs. 5D3.1(a), 5D3.2(b)(1). If Roberts violates the conditions of his supervised release, the court may revoke his supervised release and send him back to prison for up to three more years. 18 U.S.C. Sec. 3583(e)(3). Thus, Roberts's maximum sentence is at least twenty-three years, not twenty years. Because of the term of supervised release, Roberts received a potentially longer sentence than he was apprised of at his plea hearing. 15 If the defendant receives a potentially longer sentence than the maximum he was told, the failure to inform him of the supervised release term affects his "substantial rights" and is not harmless error. Fed.R.Crim.P. 11(h); Rodriguera v. United States, 954 F.2d 1465, 1469 (9th Cir.1992) (no harmless error where defendant was advised maximum was forty years but received eight years in prison plus ten years supervised release which could potentially be extended to life); United States v. Sanclemente-Bejarano, 861 F.2d 206, 209-10 (9th Cir.1988) (harmless error where defendant was advised maximum sentence was life imprisonment and received fifteen year sentence and five year term of supervised release); United States v. Sharon, 812 F.2d 1233, 1234 (9th Cir.1987) (not harmless error where defendant was advised maximum was twenty-one years and he received ten year term and ten years of special parole because liberty could be restricted for well over twenty-one years). 16 The government argues that the version of Rule 11 in effect at the time of Roberts's plea hearing did not require the judge to discuss supervised release under the Guidelines. This is probably true.3 The government further contends the judge was not obligated to discuss statutory supervised release. This is also true.4 However, Rule 11 still mandates that the judge tell the defendant the "maximum possible penalty." The defendant should not receive a sentence longer than the one discussed at the plea hearing. 17 The government also argues that the plea agreement mentioned a term of supervised release, so Roberts's plea was voluntary, and any failure to mention it in open court was harmless error. However, the plea agreement simply listed the statutory maximum penalties for all the counts in the indictment. Supervised release was mentioned as part of the maximum statutory penalty for violating 21 U.S.C. Sec. 841(a)(1)--a crime that Roberts did not plead guilty to. 18 In fact, we take the Rule 11 mandate quite literally. In Sanclemente-Bejarano, 861 F.2d at 208, the judge at the plea hearing asked the defense counsel if there was a supervised release term and she said "Yes.... According to the new [law], there should be five years supervised release. At least five years in addition to the term of imprisonment, if there is no prior conviction." Id. at 208. We held this exchange did not satisfy Rule 11 because "[t]he court did not inform [defendant] of the provision, nor did it ask him if he understood the meaning of supervised release or its effect." Id. at 210. 19 Here, the judge failed to say anything at all about the supervised release term at the plea hearing. The Rule 11 violation arises not from the fault of the district judge, but from an awkward contradiction in the law--the Guidelines required the judge to impose a term of supervised release, while Rule 11 required the judge to impose a sentence not exceeding the "maximum possible penalty" discussed at the plea hearing. In this situation, Rule 11 trumps the Guidelines. United States v. Sharp, 883 F.2d 829, 831 (9th Cir.1989). Thus, we remand this case to the district court and instruct the judge either to delete the three year term of supervised release from the sentence or allow Roberts to replead. 20 B. The government did not breach the plea agreement. 21 Whether a plea agreement has been violated is a question of fact for the district court and is reviewed for clear error. United States v. Sutton, 794 F.2d 1415, 1423 (9th Cir.1986). The AUSA properly refrained from asking for a sentence reduction because Roberts breached the plea agreement by disobeying the law during the course of his cooperation. The plea agreement stated that whether the defendant broke the law would be assessed under a probable cause standard. Probable cause to arrest a person exists when officers have reasonably trustworthy information that warrants a reasonably cautious person to believe that an offense has been committed. United States v. Dunn, 946 F.2d 615, 619 (9th Cir.1991). Probable cause is assessed from the totality of the circumstances. Illinois v. Gates, 462 U.S. 213, 238, 103 S.Ct. 2317, 2332, 76 L.Ed.2d 527 (1983). 22 The AUSA had probable cause to believe Roberts was violating the law by continuing to sell precursor chemicals and finished methamphetamine on the sly and for his own profit while he was cooperating with the government. First, an informer tipped off an officer that Roberts was selling methamphetamine to Norman Pine and Sherri Keller, known customers of Roberts. Second, Waymon Cooper, an employee of Roberts, called six to ten times to report Roberts was selling chemicals and drugs. Third, Agent Prose was driving in the car with Roberts when Roberts's beeper--beepers are commonly used by drug dealers--went off at least eight to ten times, yet Roberts did not return the calls on his car phone and answered evasively when questioned about the calls. And fourth, Larry Jones, Roberts's employee and co-defendant, told an agent that Roberts was getting clandestine shipments of precursor chemicals from Tennessee for sale to a California distributor. Thus, the government did not breach the plea agreement by not asking for a reduced sentence because the defendant breached it first by breaking the law. 23 C. Ineffective assistance of counsel. 24 Whether a defendant received ineffective assistance of counsel is reviewed de novo. United States v. Swanson, 943 F.2d 1070, 1072 (9th Cir.1991). In order to make out an ineffective assistance of counsel claim, the appellant must show counsel's performance was deficient and the defense was thereby prejudiced. Strickland v. Washington, 466 U.S. 668, 687, 104 S.Ct. 2052, 2064, 80 L.Ed.2d 674 (1984). In order to show prejudice regarding a plea, a defendant must generally show that, absent his counsel's errors, he would have gone to trial rather than have pled guilty. Hill v. Lockhart, 474 U.S. 52, 59, 106 S.Ct. 366, 370, 88 L.Ed.2d 203 (1985). 25 Roberts alleges the following attorney errors: 1) his attorney did not object to the enhancements for firearms and leadership role, and 2) his attorney did not go over the presentence report with him and failed to object to errors in the report.5 Neither of these things constituted ineffective assistance of counsel. 26 1. Enhancements for firearms and leadership. 27 The enhancements for both possession of firearms and Roberts's leadership role were proper, and the attorney did not err in failing to object to them. The plea agreement stated the government would not file a firearms charge based on the guns found when he was arrested, and it did not do so. However, this does not preclude the sentencing court from using the firearm possession to enhance Roberts's sentence. United States v. Flores-Payon, 942 F.2d 556, 561-62 (9th Cir.1991). 28 A defendant's role in a conspiracy is a question of fact reviewed for clear error. See United States v. Howard, 894 F.2d 1085, 1088 (9th Cir.1990). It was not clear error to apply the four point "leadership" enhancement. The Sentencing Guidelines provide for a four point increase in the base offense level "[i]f the defendant was an organizer or leader of a criminal activity that involved five or more participants or was otherwise extensive." U.S.S.G. Sec. 3B1.1(a). 29 To decide if a person is an "organizer or leader," the court examines the following factors: 30 [T]he exercise of decision making authority, the nature of participation in the commission of the offense, the recruitment of accomplices, the claimed right to a larger share of the fruits of the crime, the degree of participation in planning or organizing the offense, the nature and scope of the illegal activity, and the degree of control and authority exercised over others. 31 U.S.S.G. Sec. 3B1.1, comment. (n. 3). Here, Roberts owned Gemini Chemical, purchased the chemicals, negotiated the sale directly with the undercover agent/buyer, directed his employee to deliver the chemicals, and stood to profit the most from the transaction. On similar facts the Ninth Circuit has held a four point enhancement was appropriate. United States v. Avila, 905 F.2d 295, 298-99 (9th Cir.1990) (four point "leader" enhancement for defendant who had reputation as "heavy drug dealer," negotiated price, had alternative sources, dealt in large amounts, coordinated procurement and distribution). 32 The four point increase was justified because, while there were only three, not five, participants, the criminal activity was "otherwise extensive."6 U.S.S.G. Sec. 3B1.1. "In assessing whether an organization is 'otherwise extensive,' all persons involved during the course of the entire offense are to be considered. Thus, a fraud that involved only three participants but used the unknowing services of many outsiders could be considered extensive." U.S.S.G. Sec. 3B1.1, comment. (n. 2). Here, there were other people who provided "unknowing services." There were four employees at Gemini Chemical who were unwittingly involved. In addition, Roberts bought chemicals from supply companies in both New Jersey and Seattle, necessarily involving people at both places. 33 2. Failure to object to alleged inaccuracies in the presentence report. 34 Roberts argues he received ineffective assistance of counsel because his attorney failed to go over the presentence report with him and failed to object to alleged inaccuracies in the presentence report. The merits of these claims are lacking. First, Roberts's lawyer told the court he had gone over the report "in detail" with his client. When Roberts was asked to comment at his sentencing hearing, he did not disagree with this statement. 35 Furthermore, the alleged inaccuracies either did not exist or, as discussed above, did not affect Roberts's sentencing. The presentence report estimated the amount of methamphetamine that could be made from the 3,550 kilograms of precursor chemicals that Roberts had purchased. Roberts raises three criticisms about this estimate. First, he says he bought the lion's share, 3,450 kilograms out of 3,550 kilograms, of phenylacetic acid before the conspiracy began, so he contends his sentence should have been based on only 100 kilograms of the chemical. However, Roberts was conspiring to manufacture and distribute methamphetamine during the time of the charged conspiracy. That he had bought the chemicals earlier is of no import. 36 Second, he argues phenylacetic acid was not a controlled substance at the time of his offense, and the Sentencing Guidelines did not contain a conversion table for estimating the quantity of methamphetamine from phenylacetic acid. These points are directly controverted by United States v. Bertrand, 926 F.2d 838, 845-47 (9th Cir.1991). While the guidelines did not provide a conversion table, they did provide for an approximation to be made. U.S.S.G. Sec. 2D1.4, comment. (n. 2). Here, the agent's conservative estimate that one could manufacture methamphetamine equal to one fourth the quantity of precursor chemicals was satisfactory. Roberts had purchased such a huge quantity of precursor chemicals that even if one used a much lower conversion rate, one would still arrive at the highest base offense level of 36. 37 SENTENCE VACATED AND REMANDED. The panel finds this case appropriate for submission without argument pursuant to 9th Cir.R. 34-4 and Fed.R.App.P. 34(a) 1 All the issues raised in his motions but not specifically discussed lack merit 2 The government contends this issue was not raised below. However, Roberts did take issue with the magistrate's finding that "the Rule 11 violation movant has raised is immaterial due to movant having been informed of the maximum sentence." C.R. 95 at 1. He also complained that imposing the term of supervised release violated Rule 11. C.R. 58 at 3. Even if this issue was not raised sufficiently below, Roberts can now raise it if it is purely a question of law, which is not dependent on the factual record, United States v. Barnett, 935 F.2d 178, 180 (9th Cir.1991), and if the opposing side does not suffer prejudice as a result, United States v. Flores-Payon, 942 F.2d 556, 558 (9th Cir.1991). Whether a Rule 11 violation occurred because of the judge's failure to discuss the term of supervised release at Roberts's plea hearing is purely a legal question, and we do not think the government will suffer any prejudice 3 As previously stated, the judge was not obligated to discuss the Guidelines at that time. Ramos, 923 F.2d at 1357. However, the version of Rule 11 in effect at the plea hearing required the judge to discuss a "term of supervised release." Fed.R.Crim.P. 11(c)(1) (1988). The government contends that these words refer only to statutory supervised release, not supervised release imposed under the Guidelines. The plain words of Rule 11 make no such distinction, although, with the benefit of both hindsight and legislative history, the government may be right 4 Roberts pled guilty only to conspiracy under 21 U.S.C. Sec. 846. Until November 18, 1988, a conspirator was not subject to the mandatory term of supervised release contained in the underlying statute--in Roberts's case, 21 U.S.C. Sec. 841(b)(1)(C). Bifulco v. United States, 447 U.S. 381, 401, 100 S.Ct. 2247, 2259, 65 L.Ed.2d 205 (1980). However, effective November 18, 1988--three days before Roberts's plea hearing--the conspiracy statute was amended so conspirators would get the same penalties, including Sec. 841's mandatory term of supervised release, as do people who commit the underlying offense. Anti-Drug Abuse Act of 1988, Pub.L. No. 100-690 Sec. 6470(a), 102 Stat. 4181, 4377. Nonetheless, we hold that the amended version of the conspiracy statute should apply only to offenses committed after its effective date. United States v. Moon, 926 F.2d 204, 210 (2d Cir.1991); United States v. Curry, 902 F.2d 912, 917 (11th Cir.), cert. denied, 498 U.S. 1015, 111 S.Ct. 588, 112 L.Ed.2d 592 (1990), and cert. denied, 498 U.S. 1091, 111 S.Ct. 973, 112 L.Ed.2d 1059 (1991). If we were to apply the amended version of Sec. 846 to offenses committed before its effective date, such as Roberts's, it would violate the Ex Post Facto Clause of the Constitution. Curry, 902 F.2d at 917 n. 5 5 Roberts makes several other arguments. First, he says Mistretta required a new presentence report. However, the report was prepared pursuant to the Guidelines, so this claim fails. Second, he says his attorney failed to file a notice of appeal after agreeing to do so. The record controverts this--the attorney only agreed to continue his representation long enough to discuss whether the defendant wished to appeal. C.R. 35 at 28. Third, Roberts claims his attorney did not know about the Sentencing Reform Act. The record also refutes this--the attorney knew Roberts's case was theoretically a Guidelines case. It so stated in the presentence report, and it was discussed at the plea hearing 6 The presentence report incorrectly based its four point increase on the presence of five or more participants. However, this inaccuracy did not affect Roberts's sentence. Fed.R.Crim.P. 32(c)(3)(D). The enhancement was justified because, as discussed above, the criminal activity was "otherwise extensive." Furthermore, even if the criminal activity was not "otherwise extensive," Roberts would still have received the statutory maximum of twenty years. Roberts clearly held enough of a leadership role to justify a two point enhancement. U.S.S.G. Sec. 3B1.1(c); United States v. Monroe, 943 F.2d 1007, 1019 (9th Cir.1991) (two point enhancement appropriate where defendant exercised decisionmaking authority and had organizational role), cert. denied, --- U.S. ----, 112 S.Ct. 1585, 118 L.Ed.2d 304 (1992). A two point leadership enhancement would have yielded a total base offense level of 38, resulting in a guideline range of 292-365 months--still in excess of the statutory maximum of 240 months	{ "pile_set_name": "FreeLaw" }
204 Mich. App. 310 (1994) 514 N.W.2d 253 PEOPLE v. ROSS Docket No. 163357. Michigan Court of Appeals. Submitted January 19, 1994, at Detroit. Decided March 22, 1994, at 9:00 A.M. Frank J. Kelley, Attorney General, Thomas L. 311 Casey, Solicitor General, John D. O'Hair, Prosecuting Attorney, Timothy A. Baughman, Chief of Research, Training, and Appeals, and Rita H. Lewis, Assistant Prosecuting Attorney, for the people. Gabi D. Silver, for the defendant. Before: JANSEN, P.J., and McDONALD and G.M. HOCKING,[] JJ. PER CURIAM. The prosecution appeals by leave granted from a December 2, 1992, opinion and order granting defendant a new trial. We reverse. Following a bench trial, defendant was convicted as charged of possession of a stolen vehicle with intent to pass false title, MCL 257.254; MSA 9.1954, and sentenced to three to ten years' imprisonment. Defendant filed a motion for a new trial, claiming his conviction was against the great weight of the evidence because the prosecution allegedly failed to present evidence regarding one of the elements of the offense. The motion, heard by a successor judge, was granted. The statute under which defendant was convicted provides, in relevant part: Any person who shall knowingly make any false statement of a material fact, either in his or her application for the certificate of title required by this act, or in any assignment of that title, or who, with intent to procure or pass title to a motor vehicle which he or she knows or has reason to believe has been stolen, shall receive or transfer possession of the same from or to another ... is guilty of a felony. This language prohibits two separate types of conduct. People v Harbour, 76 Mich App 552; 257 312 NW2d 165 (1977).[1] The first part of the quoted language of the statute prohibits the making of false statements in applying for or signing a certificate of title for a motor vehicle. The second part, and the part applicable to this case, makes it illegal for a person in possession of a vehicle that the person knows to be stolen to transfer possession of the vehicle with the intent to pass title to the vehicle as well. The question raised by defendant in his motion for a new trial and to be determined on appeal is whether passing "title" in the second part of the statute means passing a "certificate of title" or passing the intangible right of ownership generally known as "title." The successor judge concluded the passing of "title" in the statute refers to the passing of the "certificate of title." We conclude, as did the original trial judge, that the second part of the statute encompasses the passing of the right of ownership. In Harbour, supra, the defendant was convicted under the statute at issue in this case. Several issues were raised on appeal. In discussing the second part of the statute, this Court expressly stated "title" does not mean "certificate of title," noting that the statute itself and other sections of the Vehicle Code utilize the phrase "certificate of title" where it appears the Legislature intended to identify that particular document. This Court stated: "Title" therefore refers to intangible ownership. One generally transfers "possession" of physical objects, not intangible concepts. Since the purpose of the act is to prevent traffic in stolen vehicles, it is doubtful that the Legislature intended to proscribe transfer of possession of title without regard 313 for whether possession of the stolen vehicle was also transferred. [Id. at 559.] Moreover, MCL 257.257; MSA 9.1957 specifically prohibits the alteration or falsifying of any "certificate of title, registration certificate, or registration...." If we accept defendant's definition of "title" as meaning "certificate of title," every violation of MCL 257.254; MSA 9.1954 would also result in a violation of § 257. A thief attempting to transfer a stolen car and a certificate of title would necessarily be using an altered or forged certificate of title. We believe the second part of MCL 257.254; MSA 9.1954 is intended to cover situations such as the instant one wherein a defendant trafficks in stolen vehicles without getting involved with the formalities of a certificate of title. We therefore conclude the successor judge erred in holding "title" as used in § 254 refers to "certificate of title." Defendant's conviction is affirmed. NOTES [*] Circuit judge, sitting on the Court of Appeals by assignment. [1] The third part of the statute, not at issue and not quoted in this case, was deemed superfluous or invalid in People v Morton, 384 Mich 38; 179 NW2d 379 (1970).	{ "pile_set_name": "FreeLaw" }
509 So.2d 205 (1987) Charlie WHITE, Jr. v. Frankie Saralyn (Walton) WHITE. No. 56360. Supreme Court of Mississippi. April 15, 1987. As Modified on Denial of Rehearing June 3, 1987. Isaac K. Byrd, Jr., James W. Craig, Bryd & Associates, Jackson, for appellant. Harlon H. Varnado, Patricia R. Alexander, Jackson, for appellee. Before WALKER, C.J., and DAN M. LEE and GRIFFIN, JJ. DAN M. LEE, Justice, for the Court: Appellant, Charlie White, Jr., appeals the divorce and alimony granted by the chancellor below in favor of Appellee, Mrs. Frankie Saralyn Walton White. Judgment of Divorce was granted November 27, 1984, on the grounds of habitual cruel and inhuman treatment pursuant to Miss. Code Ann. § 93-5-1 (1972). Appellant appeals assigning three errors made by the chancellor: I. THE CHANCELLOR ERRED IN GRANTING APPELLEE'S MOTION TO DISMISS APPELLANT'S PLEADINGS, AND IN OVERRULING APPELLEE'S MOTION TO SET ASIDE ORDER DISMISSING APPELLANT'S PLEADINGS. II. THE CHANCELLOR ERRED IN THAT THE ALIMONY, CHILD SUPPORT, THE AUTOMOBILE AWARDED AND THE ORDER REQUIRING APPELLANT TO PAY THE INTERNAL REVENUE SERVICE AND THE MISSISSIPPI STATE TAX COMMISSION WERE CLEARLY AGAINST THE OVERWHELMING WEIGHT OF THE EVIDENCE. III. THE CHANCELLOR ERRED IN AWARDING $5,000 IN ATTORNEY FEES, WHICH WERE EXCESSIVE AND CLEARLY UNSUPPORTED BY THE EVIDENCE. 206 We reverse for the unwarranted imposition of the most severe of discovery sanctions. FACTS Appellant and Appellee were married on July 30, 1970. A child, Carlyle Creswell White, was born February 13, 1979. Appellee filed her bill of divorce on December 18, 1981. Appellant answered and filed a similar complaint January 21, 1982, also seeking a divorce on grounds of habitual cruel and inhuman treatment. The couple separated on October 30, 1981, and they have remained continuously separated. Appellant's lack of compliance with discovery requests and the propriety of the sanctions arising therefrom presents the major issue on appeal. Discovery commenced and on July 8, 1982, Appellee filed a Request for Production of Documents. This request went unanswered and on October 14, 1982, the chancellor granted Frankie's motion to compel production. Counsel for Appellant was substituted on October 28, 1982. However, Appellant apparently did not comply with the chancellor's order, and on December 7, 1982, Appellant was held in contempt of court for failure to produce the documents. On December 9, 1982, Appellant filed a response to the request for production of documents. However, it is not complete and Appellant acknowledges it is confusing because the answers are mismatched to the requests. But interrogatories were taken and a tox of records were tendered to counsel for Appellee which were rejected in that form. Little else occurred until Appellee began a second round of discovery on May 20, 1984, by noticing her intent to depose Appellee, attaching a request for further production of documents to be made at the deposition. Appellant did not appear to be deposed and did not produce the documents. The chancellor found Appellant in contempt on July 10, 1984. The chancellor's order stated Appellant could purge the contempt by paying $250 in attorney's fees, by paying $35 in stenographer's fee and by appearing for a deposition in Jackson on July 14 with the requested documents. Appellant did not appear to be deposed and did not produce the documents. A second contempt order was entered August 9, 1984. The trial court ordered Appellant to pay $250 in attorney's fees and $15 court costs as well as fees remaining unpaid. Appellant was ordered to appear with the requested documents on August 10, 1984, to be deposed. This he did. Appellee apparently was satisfied with the substance of Appellant's belated discovery compliance. Appellee made no further discovery requests nor sought further to compel discovery. However, on September 24, Appellee filed a motion to dismiss Appellant's pleadings for failure to comply with discovery requests and court orders. This motion was set for hearing on November 1, 1984. In the interim, on October 5, 1984, Appellant was again held in contempt, but this order only related to his continued failure to pay accumulated attorney's fees. On November 1, 1984, the chancellor granted Appellee's motion to dismiss Charlie's pleading as a sanction for Appellant's discovery violations. On November 19, 1984, Appellant moved the chancellor to set aside this order. Appellant sought this relief noting that he complied, ultimately, with discovery requests. This motion was overruled and Appellant's pleading was dismissed. The divorce was heard as uncontested on November 21, 1984 and the chancellor granted Appellee a divorce on grounds of habitual cruel and inhuman treatment. Most of the testimony focused on the parties' financial status. The chancellor awarded Appellee $600 per month alimony, $600 per month child support and $150,000 lump sum alimony. The chancellor awarded Appellee attorney fees of $5,000 to be paid by Appellant, along with the couple's automobiles, ordering appellant to pay joint indebtedness to CitiCorp of $19,000 plus interest, and further ordering appellant to pay the couples' 1981 Federal 207 and State income taxes, for which they had not yet reported. DISCUSSION OF LEGAL ISSUES I. DID THE CHANCELLOR ERR IN GRANTING APPELLEE'S MOTION TO DISMISS APPELLANT'S PLEADING, AND IN OVERRULING APPELLANT'S MOTION TO SET ASIDE THE DISMISSAL OF APPELLANT'S PLEADINGS? The parties do not appear to dispute that the decision to impose sanctions for discovery abuse is vested in the trial court's discretion. Kilpatrick v. Mississippi Baptist Medical Center, 461 So.2d 765 (Miss. 1984). Our rule concerning sanctions is Rule 37, M.R.C.P., Failure to Make or Cooperate in Discovery: Sanctions. Of particular importance to the discussion here is Rule 37(b)(2), pertaining to failures to comply with court orders. There it is stated: (2) Sanctions by Court in Which Action is Pending. If a party ... fails to obey an order to provide or permit discovery, including an order made under subsection (a) of this rule, the court in which the action is pending may make such orders in regard to the failure as are just, and among others the following: (A) an order that the matters regarding which the order was made or any other designated facts shall be taken to be established for the purposes of the action in accordance with the claim of the party obtaining the order; (B) an order refusing to allow the disobedient party to support or oppose designated claims or defenses, or prohibiting him from introducing designated matters in evidence; (C) an order striking out pleadings or parts thereof, or staying further proceedings until the order is obeyed, or dismissing the action or proceeding or any part thereof, or rendering a judgment by default against the disobedient party; [emphasis added]. * * * * * * Rule 37(d) also allows the court to make such orders as are just, including any action authorized under 37(b)(2)(A), (B) or (C), as a sanction for a party's failure to attend his own deposition. Rule 37(e) provides the court where the action is pending with a residuary grant of authority to impose "such sanctions as may be just." These provisions are intended to give the court great latitude in fashioning appropriate sanctions and this Court has given great deference to the exercise of this discretion. However, this does not mean that the trial court's decision is beyond reproach. We have held on several occasions that a court abused its discretion in failing to impose sanctions or by imposing sanctions less severe than warranted. See Harris v. General Host Corp., 503 So.2d 795 (Miss. 1986); Wallace v. Employers Mut. Cas. Co., 443 So.2d 843 (Miss. 1983); Square D Co. v. Edwards, 419 So.2d 1327 (Miss. 1982); Huff v. Polk, 408 So.2d 1368 (Miss. 1982). True, this Court until now has yet to find a sanction excessive, but we must remember the nature of sanction we deal with here. In Kilpatrick, it is said: If the failure to comply is because of inability to comply, rather than because of willfulness, bad faith, or any fault of the party, the action may not be dismissed, nor a default judgment given, and less severe sanctions are the most that can be invoked. This merely emphasizes the fact that Rules 37(b) and 37(d) call upon the court to "make such orders in regard to the failure as are just," and that justice requires that the most drastic sanctions be reserved for flagrant cases. 461 So.2d at 768. This statement is no more than a reflection of the constitutional due process considerations outlined by the United States Supreme Court in Societe Internationale v. Rodgers, 357 U.S. 197, 78 S.Ct. 1087, 2 L.Ed.2d 1255 (1958). See National Hockey 208 League v. Metro Hockey Club, Inc., 427 U.S. 639, 96 S.Ct. 2778, 49 L.Ed.2d 747 (1976). The necessary intent, if you will, may be evidenced by a party's failure to obey a court order, but this failure too, may be related to an inability to comply rather than sanctionable conduct. Here the chancellor made no determination of willfulness or bad faith. In the proper case willfulness or bad faith may be so clearly demonstrated that neither a particular finding (nor consideration of other factors we outline below) will be necessary to uphold the imposition of ultimate sanctions.[1] We believe those cases are rare, however. We cannot say from this record that willfulness or bad faith is so clearly demonstrated that the sanction must be upheld on this ground alone. There being no finding of willfulness or bad faith, we might assume that the facts support the decision of the chancellor. Bryant v. Cameron, 473 So.2d 174, 179 (Miss. 1985). See Brown v. Williams, 504 So.2d 1188 (Miss. 1987). But in any event, willfulness or bad faith alone might not substantiate the imposition of ultimate sanctions. Willfulness or bad faith is a minimum requirement, but there are several other factors to consider. Our Rule 37(b)(2) is similar to Rule 37(b)(2), Fed.R. Civ.P., and of course federal decisions interpreting this rule are persuasive. See Brown v. Credit Center, Inc., 444 So.2d 358, 364 n. 1 (Miss. 1983). In this context we find helpful the decision of the Fifth Circuit Court of Appeals in Batson v. Neal Spelce Associates, Inc., 765 F.2d 511 (5th Cir.1985). The Court stated: In determining whether a district court abused its discretion, our precedent has addressed a number of considerations. First, dismissal is authorized only when the failure to comply with the court's order results from willfulness or bad faith, and not from the inability to comply. National Hockey League, 427 U.S. at 640, 96 S.Ct. at 2779; see also Marshall v. Segona, 621 F.2d 763, 767, n. 8 (5th Cir.1980). Next, dismissal is proper only in situations where the deterrent value of Rule 37 cannot be substantially achieved by the use of less drastic sanctions. Marshall, 621 F.2d at 768. Another consideration is whether the other party's preparation for trial was substantially prejudiced. Finally, dismissal may be inappropriate when neglect is plainly attributable to an attorney rather than a blameless client, or when a party's simple negligence is grounded in confusion or sincere misunderstanding of the court's orders. Marshall, 621 F.2d at 768; Silas v. Sears, Roebuck & Co., 586 F.2d 382, 385 (5th Cir.1978). Id. at 514. Obviously, findings by the sanctioning court on these considerations would also be beneficial to this Court on review. Here no findings were made, and we find that the lack of prejudice and the availability of other sanctions warrants reversal. Here discovery concluded after Appellant submitted himself to be deposed. Though at oral argument counsel for Appellee maintained that she was not completely satisfied with Appellant's compliance, she made no further move to compel discovery and the case proceeded to hearing. Appellant was deposed, and he produced documents as requested, on August 10, 1984. The motion to dismiss Appellant's pleadings followed six weeks later on September 24, 1984, and the hearing on Appellee's bill of divorce did not occur until November 21, 1984, more than three months after Appellant was deposed. In seeking dismissal of Appellant's pleadings, Appellee did not mention any particular discovery request as remaining unanswered. In our review 209 of the record we find that any slight variance between the documents requested and those received in no way prejudiced Appellee. Obviously, belated compliance with court orders compelling discovery will not always absolve the sins that have gone before, and we do not mean to intimate that eleventh hour responses will avert proper dismissals. However here, compliance preceded the motion for dismissal by nearly six weeks, and preceded trial by more than three months in what was a relatively uncomplicated divorce. Where there is nothing to indicate whether the fault lies with the party or his counsel, we are hesitant to approve dismissal in similar situations. In addition, other sanctions were available. The court could have ordered Appellant incarcerated at the time he appeared for the divorce hearing, or baring his appearance, conduct the divorce as uncontested at that point. The chancellor could have dismissed Appellant's cross-complaint of divorce while allowing him to continue to contest Appellee's complaint. The wisdom of such an alternative becomes apparent given the manifest injustice in the decree as entered. The record is clear that the $150,000 lump sum alimony award is oppressive. There can be no doubt that the chancellor's order effectively denied Appellant an opportunity to prevent such an oppressive award. It no doubt extended the litigation between these parties, as Appellant would likely be entitled to equitable relief on grounds of impossibility. See Taylor v. Taylor, 348 So.2d 1341, 1343 (Miss. 1977). A court should be reluctant to impose the most severe sanction of dismissal where the goal of judicial economy and efficiency is not served. Cross v. General Motors Corp., 721 F.2d 1152, 1156 (8th Cir.1983), cert. denied, 466 U.S. 980, 104 S.Ct. 2364, 80 L.Ed.2d 836 (1984). Judicial economy is best served by not rendering impossible decrees, and that could have been avoided here. In holding as we do today we are not unmindful of the deterrence factor embodied in our discovery rules (and implicated in our decisions) to insure against future discovery abuses. See National Hockey League, 427 U.S. at 643, 96 S.Ct. at 2781, 49 L.Ed.2d at 75. We do not intend to condone the flouting of court orders, nor do we suggest that compliance with discovery obligations be anything less than vigorous. However, it has been said that dismissal for discovery violations is a "draconian" remedy or a "remedy of last resort," only to be applied in extreme circumstances. Batson, 765 F.2d at 515. We only hold that extreme circumstances warranting dismissal did not exist in this case and the chancellor abused his discretion in dismissing the pleadings of Appellant, thereby effectively closing to him the courtroom door. Because we reach this decision, we need not address the amount of alimony awarded, as this surely will be revised in light of Appellant's opportunity to contest the proceeding below. However, we feel compelled to address the award of attorney's fees granted below, which Appellant also assigns as error. The lower court awarded attorney's fees to Appellee in the amount of $5,000. The only testimony concerning the appropriateness of these fees was an estimate made by counsel for Appellee during her questioning. This exchange took place: Q. (Mr. Varnado): We have been working on this case in excess of two years and I have not yet rendered you a bill because we have not completed it. I think about $5,000 would be a reasonable fee. Would you think I have put in that much time and do you think that would be reasonable? A. Yes, I do. This evidence is wholly insufficient to substantiate an award of attorney's fees. Bumgarner v. Bumgarner, 475 So.2d 455, 456 (Miss. 1985); McKee v. McKee, 418 So.2d 764 (Miss. 1982). Finding that the chancellor erred in dismissing appellant Charlie White, Jr.'s pleadings and erred in awarding attorney *210 fees to Frankie Saralyn Walton White, the decree of divorce rendered in the Chancery Court of Hinds County is hereby set aside and this case reversed for reinstatement of the cause on the court docket. REVERSED AND REMANDED. WALKER, C.J., ROY NOBLE LEE and HAWKINS, P.JJ., and PRATHER, ROBERTSON, SULLIVAN, ANDERSON and GRIFFIN, JJ., concur. NOTES [1] We need not hold that the court where the action is pending must articulate a finding of the requisite willfulness, although the Sixth and Third Circuit Courts of Appeals have instituted similar requirements. See Patton v. Aerojet Ordinance Co., 765 F.2d 604, 608 (6th Cir.1985); Quality Prefabrication, Inc. v. Daniel J. Keating Co., 675 F.2d 77, 81 (3rd Cir.1982). Certainly, findings on the legal and factual determinations necessary to support imposition of the most severe sanctions aid this Court in determining whether discretion has been appropriately exercised and we trust the trial courts of this state will take note.	{ "pile_set_name": "FreeLaw" }
UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 02-6103 DAN OLIVER, Petitioner - Appellant, versus D. BRAXTON, Warden, Respondent - Appellee. Appeal from the United States District Court for the Eastern District of Virginia, at Alexandria. Claude M. Hilton, Chief District Judge. (CA-01-349-AM) Submitted: May 30, 2002 Decided: June 6, 2002 Before WILKINS, TRAXLER, and GREGORY, Circuit Judges. Dismissed by unpublished per curiam opinion. Dan Oliver, Appellant Pro Se. Thomas Drummond Bagwell, Assistant Attorney General, Richmond, Virginia, for Appellee. Unpublished opinions are not binding precedent in this circuit. See Local Rule 36(c). PER CURIAM: Dan Oliver seeks to appeal the district court’s order denying relief on his petition filed under 28 U.S.C.A. § 2254 (West 1994 & Supp. 2001). We have reviewed the record and the district court’s opinion and find no reversible error. Accordingly, we deny a certificate of appealability and dismiss the appeal on the reasoning of the district court. Oliver v. Braxton, No. CA-01-349- AM (E.D. Va. filed Nov. 8, 2001 & entered Nov. 9, 2001). Oliver’s motion for return of legal documents is denied. We dispense with oral argument because the facts and legal contentions are adequately presented in the materials before the court and argument would not aid the decisional process. DISMISSED 2	{ "pile_set_name": "FreeLaw" }
NOTICE: NOT FOR OFFICIAL PUBLICATION. UNDER ARIZONA RULE OF THE SUPREME COURT 111(c), THIS DECISION IS NOT PRECEDENTIAL AND MAY BE CITED ONLY AS AUTHORIZED BY RULE. IN THE ARIZONA COURT OF APPEALS DIVISION ONE STATE OF ARIZONA, Respondent, v. ADAN ORDUNO, JR., Petitioner. No. 1 CA-CR 14-0609 PRPC FILED 9-27-2016 Petition for Review from the Superior Court in Maricopa County No. CR2004-005009-001 CR2004-009241-002 CR2004-012347-001 CR2004-019024-001 The Honorable Warren J. Granville, Judge REVIEW GRANTED; RELIEF DENIED COUNSEL Maricopa County Attorney’s Office, Phoenix By Diane Meloche Counsel for Respondent Adan Orduno, Jr., Buckeye Petitioner STATE v. ORDUNO Decision of the Court MEMORANDUM DECISION Presiding Judge Patricia K. Norris delivered the decision of the Court, in which Judge Samuel A. Thumma and Judge Margaret H. Downie joined. N O R R I S, Judge: ¶1 Adan Orduno, Jr., petitions this court for review of the superior court’s summary dismissal of his untimely notice of post- conviction relief. We have considered the petition for review and, for the reasons stated, grant review but deny relief. ¶2 After pleading guilty to attempted burglary in the third degree, aggravated assault, trafficking in stolen property, and theft of means of transportation in four separate cases, the superior court sentenced Orduno to three concurrent prison terms, the longest of which was 7.5- years, followed by a three-year term of probation. The superior court revoked Orduno’s probation on June 20, 2014, and sentenced him to a 4.5- year term of imprisonment. ¶3 In July 2014, Orduno filed a notice of post-conviction relief challenging his convictions in all four cases. Finding the notice untimely and that Orduno had failed to make a sufficient showing of any claims that could be raised in an untimely proceeding, the superior court summarily dismissed the proceeding. ¶4 In dismissing the proceeding, the superior court issued a ruling that clearly identified, fully addressed, and correctly resolved Orduno’s claims. Under these circumstances, we need not repeat that analysis here—instead, we adopt it. See State v. Whipple, 177 Ariz. 272, 274, 866 P.2d 1358, 1360 (App. 1993) (when superior court rules “in a fashion that will allow any court in the future to understand the resolution[,] [n]o useful purpose would be served by this court rehashing the trial court's correct ruling in [the] written decision”). 2 STATE v. ORDUNO Decision of the Court ¶5 Accordingly, although we grant review, we deny relief. AMY M. WOOD • Clerk of the Court FILED: AA 3	{ "pile_set_name": "FreeLaw" }
961 A.2d 1276 (2008) COM. v. HAWKINS. No. 2889 EDA 2007. Superior Court of Pennsylvania. August 19, 2008. Affirmed.	{ "pile_set_name": "FreeLaw" }
967 F.2d 1337 Fed. Sec. L. Rep. P 96,842PETRO-VENTURES, INC., an Oklahoma corporation, Plaintiff-Appellant,v.Gary G. TAKESSIAN, an individual, Defendant-Appellee,Stephen R. Vrable, N. Russell Walden, and Wayne Hamersly,Intervenors-Appellees. No. 90-55349. United States Court of Appeals,Ninth Circuit. Argued and Submitted Jan. 9, 1992.Decided June 22, 1992. Benjamin T. Willey, Willey & Shoemaker, Oklahoma City, Okl., for plaintiff-appellant. John S. Einhorn, San Diego, Cal., for defendant-appellee. Maureen Folan, Hoge, Fenton, Jones & Appel, San Jose, Cal., for intervenors-appellees. Appeal from the United States District Court for the Southern District of California. Before: POOLE, WIGGINS, and LEAVY, Circuit Judges. LEAVY, Circuit Judge: 1 We decide the validity of a release of all unknown claims in the context of a settlement of ongoing litigation, where potential violations of federal securities laws were later discovered. The general rule in this circuit is that "[a] release is valid for purposes of a federal securities claim only if [there was] 'actual knowledge' that such claims existed." Burgess v. Premier Corp., 727 F.2d 826, 831-32 (9th Cir.1984) (citation omitted). However, we must decide if the facts of this case warrant an exception to this rule. 2 In a business venture in May of 1986, Petro-Ventures exchanged certain oil- and gas-producing properties for partnership units in Great American Partners. Two months after the exchange, Great American Partners and its general partner, Great American Resources, Inc. (Great American Resources) filed an action against Petro-Ventures in San Diego Superior Court for breach of contract, fraud, and recission. The basis of the complaint was that the oil- and gas-producing properties did not yield the monthly revenue that had been represented by Petro-Ventures. The action was removed from San Diego Superior Court to the United States District Court for the Southern District of California. 3 Petro-Ventures countersued Great American Partners and Great American Resources in the Western District of Oklahoma. The action was transferred to the Southern District of California. 4 On May 29, 1987, Petro-Ventures, Great American Partners, and Great American Resources settled their dispute. They memorialized the terms in a comprehensive settlement agreement in which California law was selected to govern the terms and conditions. The release provision at issue is in paragraph 9 of the agreement. Paragraph 9 states: 5 PVI [Petro-Ventures], CUDD [the president of Petro-Ventures], GAP [Great American Partners], GAR [Great American Resources], NEEDCO [a Texas limited partnership], and Takessian hereby release any and all claims demands, damages or causes of action they might have, each against the other, based upon the negotiations for sale and the conveyance of the producing oil and gas properties which were the subject of sale and conveyance from PVI to Needco in May of 1986, regardless of whether or not said claims have been set forth in the litigation referred to in Paragraph B.1. and 2. of this agreement.1 This release shall be effective as to PVI, CUDD, GAR, GAP, NEEDCO and Takessian and as to their successors, assigns, affiliated entities, directors, officers, employees, agents and attorneys. In further consideration and inducement for the compromise settlement contained herein, the parties expressly waive the benefit of Section 1542 of the California Civil Code which provides: 6 "A general release does not extend to claims which a creditor does not know or suspect to exist in his favor at the time of executing this release, which, if known by him must have materially affected his settlement with debtor." 7 In recognition of the settlement, Petro-Ventures paid $181,000 to Great American Resources and reassigned limited partnership units to them. In turn, certain wells were reassigned to Petro-Ventures. 8 The mutual parting of ways ended when Petro-Ventures filed an action against Gary Takessian2 on December 7, 1987, in the Southern District of California, seeking damages for violations of federal and state securities laws. Vrable, Walden, and Hamersly intervened in the action. On October 20, 1988, Petro-Ventures filed another action in Oklahoma District Court against Takessian, Vrable, Walden, Hamersly, and Peter R. Crystl, alleging the same facts and issues. The Oklahoma litigation was stayed pending resolution of the action in California. 9 Takessian moved to dismiss on the ground that Petro-Ventures' actions were precluded by the release provision. The district court of the Southern District of California dismissed with prejudice. The court found that "the evidence indicates that the parties attempted to draw as broad a release as possible." Memorandum Decision and Order, Civ. No. 87-1744-E (CM), May 26, 1989, at 2. Observing that both parties were represented by counsel, the court stated: 10 In a case such as the one before this court, where the parties have negotiated at arms length and the intent of the settlement agreement is clearly to release all claims, known or unknown, it would be detrimental to allow a party to assert claims that should have been covered by the agreement. Such a result would be inequitable in light of the fact that the consideration rendered in the settlement was based upon an understanding that no further litigation would result. Furthermore, allowing the assertion of a federal securities claim in the face of such a complete settlement agreement would discourage settlement negotiations in all litigation in which a federal securities claim may eventually be discovered. 11 Id. at 5. The intervenors were granted a dismissal on the same grounds and the entire action was dismissed. 12 Petro-Ventures appeals, contending it did not know the partnership units it obtained in the exchange might not have been registered properly with the Securities and Exchange Commission.3 Petro-Ventures maintains that the release of securities law claims was not discussed during settlement negotiations and that Takessian represented to its president, B. Keaton Cudd, III, that the units were properly registered: 13 During the settlement negotiations neither defendant nor anyone else connected with Great American Resources, Inc. or Great American Partners disclosed to me or Petro-Ventures, Inc. the earlier misrepresentations and omissions surrounding the May, 1986 purchase agreement. In particular, defendant continued to lead me to believe that the Great American Partners securities were in fact registered with the Securities and Exchange Commission. 14 Declaration of B. Keaton Cudd, III, at para. 8. 15 Petro-Ventures contends that unknown claims pursuant to federal securities law cannot be released under the law of this circuit, even by the execution of a settlement agreement that releases all known or unknown claims. DISCUSSION Standard of Review 16 The following standard of review applies to a dispute over a settlement agreement:When an appellate court restricts its review of the trial court's interpretation of a contract to an analysis of the language used in the contract, the issue of interpretation is a matter of law and freely reviewable. Thus, the determination of whether contract language is ambiguous is a matter of law. When the interpretation includes a review of factual circumstances surrounding the contract, the principles of contract interpretation applied to those facts present issues of law which this court can freely review. When the inquiry extends beyond the words of the contract and focuses on related facts, however, the trial court's consideration of extrinsic evidence is entitled to great deference and its interpretation of the contract will not be reversed unless it is clearly erroneous. 17 In Re U.S. Financial Sec. Litigation, 729 F.2d 628, 631-32 (9th Cir.1984) (citations omitted). 18 Because the district court reviewed both the prior and current litigation to decide whether the settlement agreement was a bar to the current litigation, it "focuse[d] on related facts." Therefore, we give great deference to the district court and reverse only for clear error. Whether State Or Federal Law Applies 19 In the settlement agreement, the parties agreed that "[t]he terms and provisions of this Agreement shall be construed according to California law." However, in a non-securities case, we held that "federal law always governs the validity of releases of federal causes of action." Mardan Corp. v. C.G.C. Music, Ltd., 804 F.2d 1454, 1457 (9th Cir.1986) (citing Dice v. Akron, Canton & Youngstown Railroad, 342 U.S. 359, 361, 72 S.Ct. 312, 314, 96 L.Ed. 398 (1952); Salmeron v. United States, 724 F.2d 1357, 1361 (9th Cir.1983); Jones v. Taber, 648 F.2d 1201, 1203 (9th Cir.1981)). An action involving securities is no different. Where a settlement agreement calls for the application of state law, but where violations of both federal and state securities law are alleged, "[i]t is well established that federal law governs all questions relating to the validity of and defenses to purported releases of federal statutory causes of action." Locafrance U.S. Corp. v. Intermodal Sys. Leasing, Inc., 558 F.2d 1113, 1115 (2d Cir.1977). The reason for this rule is that "[f]ederal statutory rights could be easily defeated if state law could be used to control the incidents of those rights and the defenses to them." Id. at 1115 n. 3.4 This is especially true where 20 [d]espite the fact that some of the California Securities Laws are modeled to some degree after the Federal Securities Laws and references in the former are made to the latter, there is nothing to suggest that the two statutory schemes are to be interdependent rather than separate, autonomous systems. 21 Blake v. Pallan, 554 F.2d 947, 952 (9th Cir.1977) (footnotes omitted). Cf. Burgess, 727 F.2d at 831-32 (Washington State would apply federal law because the state securities act provides that it is to be coordinated with related federal law). 22 The Release of Federal Securities Claims During Litigation 23 In dealing with federal securities, the general rule is that unknown or subsequently maturing causes of action may not be waived. The federal anti-waiver provision is found in section 29(a) of the Securities Exchange Act of 1934, 15 U.S.C. § 78cc(a), which states: 24 Any condition, stipulation, or provision binding any person to waive compliance with any provision of this chapter or of any rule or regulation thereunder, or of any rule of an exchange required thereby shall be void. 25 We cited this provision without discussion in Burgess. See 727 F.2d at 832. 26 Petro-Ventures argues that our previous decisions in Burgess and Royal Air Properties, Inc. v. Smith, 333 F.2d 568 (9th Cir.1964), are dispositive of this appeal. We acknowledge the broad language in Burgess: "A release is valid for purposes of federal securities claims only if [there was] 'actual knowledge' that such claims existed." 727 F.2d at 831. However, the facts of Burgess distinguish it from the situation before us. 27 In Burgess, five doctors from Seattle, Washington, invested in cattle herds. Premier, the company that sold the cattle, had represented that the cattle were of superior quality. Premier entered into management contracts with the doctors to manage the herds. Despite extensive tax deductions for the purchase, maintenance, and depreciation of the herds, all the doctors lost money on the investment. Four doctors sold their herds back to Premier while one doctor sold his herd on the open market. All sold at a substantial loss. 28 At the time Premier repurchased the cattle, each doctor signed a release of all claims against Premier. Burgess, 727 F.2d at 830-31. Later, however, all five doctors filed an action alleging, among other things, that they had discovered that the cattle were of low, rather than superior, quality. They alleged violations of state and federal securities law. 29 Premier moved for summary judgment and for a directed verdict partly on the ground that the doctors had signed the releases from liability. Id. The trial court denied the motions. 30 In our discussion of the releases, we said: 31 The motions [for summary judgment and for a directed verdict] were properly denied. 32 The intent of the releases, their application to known and unknown facts, and the disclosures and promises surrounding the releases were all questions addressed to the jury under Washington law and federal securities law. 1. Federal securities claims 33 A release is valid for purposes of federal securities claims only if the doctors had 'actual knowledge' that such claims existed. Royal Air Properties, Inc. v. Smith, 333 F.2d 568 (9th Cir.1964). Since each doctor indicated by affidavit and trial testimony that he did not know of any claims he could have raised until after he signed the release, there was a material issue of fact for the jury. Thus, the motion for summary judgment was properly denied. Because a reasonable juror could have concluded that the doctors actually were unaware of their claims, the motion for directed verdict was also properly denied. 2. State securities claims 34 While there are no cases on releases of claims under the Washington Securities Act, Washington courts would apply the 'actual knowledge' test because the state Act provides that it is to be coordinated with related federal law. RCW 21.20.900. Washington's anti-waiver provision is very similar to the federal anti-waiver provision. Cf. RCW 21.20.430(5) with 15 U.S.C. § 78cc(a). Because Royal Air Properties, supra, provides the relevant federal law for Washington state, the motions for summary judgment and directed verdict were properly denied. 35 Burgess, 727 F.2d at 831-32. 36 The Burgess facts arose in a very different context. When the doctors signed the releases, they were not involved in litigation with Premier. They were still dealing in an exclusively business relationship with Premier. We do not know whether the doctors were represented by counsel at the time the releases were signed. The facts recite only "[w]hen Premier repurchased the cattle herds from the doctors, each doctor filed a document releasing Premier from all claims." See id. at 831. When they signed the releases, the doctors were not acting in the adversarial setting that is characteristic of litigation. It was therefore appropriate to apply the general rule, because 37 While a buyer and seller of securities, under some circumstances, may deal at arm's length on equal terms, it is clear that the Securities Act was drafted with an eye to the disadvantages under which buyers labor. Issuers of and dealers in securities have better opportunities to investigate and appraise the prospective earnings and business plans affecting securities than buyers. It is therefore reasonable for Congress to put buyers of securities covered by that Act on a different basis from other purchasers. 38 Wilko v. Swan, 346 U.S. 427, 435, 74 S.Ct. 182, 186-87, 98 L.Ed. 168 (1953). 39 However, a totally different situation occurs where a plaintiff has affirmatively acted to release another party from any possible liability in connection with a transaction in securities. The parties here, in giving up all claims, "regardless of whether or not said claims have been set forth in this litigation referred to ... in this agreement" and in "expressly waiv[ing] the benefit of Section 1542 of the California Civil Code" were not so concerned with protecting their rights as investors as they were with establishing a general peace. See C.G.C. Music, Ltd., 804 F.2d at 1463 ("[T]he ... Release firmly evidences the parties' intent to end their various disputes ... once and for all."). We agree with the Second Circuit that 40 [w]hen, as here, a release is signed in a commercial context by parties in a roughly equivalent bargaining position and with ready access to counsel, the general rule is that, if 'the language of the release is clear, ... the intent of the parties [is] indicated by the language employed.' 41 Locafrance, 558 F.2d at 1115 (quoting In re Schaefer, 18 N.Y.2d 314, 317, 274 N.Y.S.2d 869, 872, 221 N.E.2d 538, 540 (1966)). There is no doubt that the language of the release is unambiguous in conveying the intent of the parties to release all unknown claims, particularly where they waived the applicability of California Code Section 1542. 42 Moreover, Royal Air, cited in Burgess, does not help Petro-Ventures. Royal Air deals with a waiver of rights under the Securities Exchange Act of 1934. 333 F.2d at 571. A waiver is "the voluntary or intentional relinquishment of a known right", id. (quotation omitted), but "it is unilaterally accomplished." Id. (footnote omitted) (emphasis added). In contrast, the release here is the result of negotiations between parties of equal bargaining power: it was not a unilateral relinquishment of rights. 43 Finally, other circuits have not applied the federal policy against the release of unknown or subsequently maturing causes of action without considering the circumstances in which a right was released. In Locafrance, the Second Circuit upheld a release in a settlement agreement arising out of a lawsuit where violations of federal securities laws were alleged, on the ground that the parties had equal bargaining positions as well as access to counsel. 558 F.2d at 1115. The Seventh Circuit has held that a party has a duty of inquiry when signing a release. Goodman v. Epstein, 582 F.2d 388, 403 (7th Cir.1978) (discussing the breadth of the anti-waiver provision of section 29(a)), cert. denied, 440 U.S. 939, 99 S.Ct. 1289, 59 L.Ed.2d 499 (1979). The release in Goodman was not negotiated during settlement of ongoing litigation. The Seventh Circuit concluded that "[t]he mere fact that an individual has been asked to sign a release should be sufficient to put that individual on notice that a reasonable inquiry should be undertaken." Goodman, 582 F.2d at 404. While we do not decide the issue of reasonable inquiry, we assume by the unambiguous language of the release that the parties knew they were giving up all rights to future claims. 44 The agreement and surrounding facts point to Petro-Ventures' desire to end its litigation with Great American Partners and Great American Resources. To that end, it knowingly gave up all rights to future litigation that might arise out of the transaction. After considering extrinsic evidence, that desire was given effect by the district court. The district court's decision was not clearly erroneous. 45 AFFIRMED. Each party shall bear its own costs and attorneys' fees. 1 Paragraphs B.1 and 2 of the settlement agreement refer by case number and name to the actions in the Southern District of California and in the Western District of Oklahoma, and to the fact that the latter case was transferred to the Southern District of California 2 The appellee, Gary Takessian, and the intervenors, Stephen R. Vrable, N. Russell Walden, and Wayne Hamersly, were on the board of directors of Great American Resources 3 Petro-Ventures claims that, based upon its review of pertinent 10-K and 10-Q forms obtained from the Securities and Exchange Commission, "there was adequate evidence to support a claim that the unit shares were not properly registered as well as to support the other claims of omissions and misrepresentations in Petro-Ventures, Inc.'s complaint." Declaration of B. Keaton Cudd, III at para. 4 4 Another circuit has applied state law in such cases, but it has done so without discussion of whether federal securities law might apply. See Finn v. Prudential-Bache Sec., Inc., 821 F.2d 581, 586 n. 5 (11th Cir.1987); Pettinelli v. Danzig, 722 F.2d 706, 709 (11th Cir.1984). In Finn, a release of all claims had been signed before the action for violation of federal securities law was filed. The release provided that Florida law governed its terms, Finn, 821 F.2d at 586 n. 5, but without any discussion the court applied federal law. In Pettinelli, a release was signed that prohibited any and all claims, known or unknown, to the date of the agreement. A stockholder's derivative suit was brought, but the court honored the release for all claims brought prior to the date of the release. The court applied Florida law despite the absence of any indication in the opinion that the parties had agreed to it and without any discussion of the applicability of federal law. Pettinelli, 722 F.2d at 709	{ "pile_set_name": "FreeLaw" }
710 A.2d 426 (1998) 153 N.J. 433 Frank GRANT, Plaintiff-Respondent, v. AMICA MUTUAL INSURANCE COMPANY, Defendant-Appellant. Supreme Court of New Jersey. Argued January 6, 1998. Decided May 12, 1998. Daniel J. Pomeroy, Springfield, for defendant-appellant (Mortenson and Pomeroy, attorneys). Fred Shahrooz-Scampato, Edison, for plaintiff-respondent (Eichen & Cahn, attorneys; Barry R. Eichen, of counsel). The opinion of the Court was delivered by STEIN, J. This appeal raises questions of underinsured motorist (UIM) coverage that are virtually indistinguishable from the issues presented and resolved in New Jersey Manufacturers Insurance Co. v. Breen, 153 N.J. 424, 710 A.2d 421 (1998), and are germane to the issues resolved in Magnifico v. Rutgers Casualty Insurance Co., 153 N.J. 406, 710 A.2d 412 (1998), both of which appeals are also decided today. The primary issue concerns the right of plaintiff, Frank Grant, injured in an accident while driving his own automobile, to recover UIM benefits under the automobile policy issued by Amica Mutual Insurance Company (Amica) to his brother with whom Grant lived. Grant's personal policy had a UIM limit equal to the tortfeasor's liability limit. His brother's policy provided UIM coverage greater than the tortfeasor's liability limit and made available that coverage to family members of the insured. As in Breen, a secondary issue is whether our decision in Aubrey v. Harleysville Insurance Cos., 140 N.J. 397, 658 A.2d 1246 (1995), should be applied only prospectively. 427 I On October 19, 1992, Grant was injured in an automobile accident while driving his own car. His car had $25,000 of UIM coverage under a policy issued by the Market Transition Facility (MTF). The tortfeasor had $25,000 of liability coverage. The tortfeasor therefore was not underinsured with respect to Grant's personal policy. Grant settled his claim against the tortfeasor for the policy limit. Grant lived with his brother, Michael Grant (Michael), when the accident occurred. Michael's policy with Amica provided $100,000 of UIM coverage. Because Michael's UIM limit was higher than the tortfeasor's liability limit, Grant sought UIM benefits under Michael's Amica policy. Amica denied Grant's claim on the ground that Aubrey prevented Grant from collecting UIM benefits under any UIM policy other than his own. Grant sued Amica seeking a declaration that UIM benefits were available to him under Michael's policy, and sought an order to show cause why arbitration should not be compelled. Following oral argument, the trial court sustained Amica's contentions based on Aubrey, dismissed the order to show cause, and dismissed Grant's complaint. Grant appealed. In an unpublished opinion the Appellate Division reversed, relying on its opinion in New Jersey Manufacturers Insurance Co. v. Breen, 297 N.J.Super. 503, 688 A.2d 647 (App.Div.), mod. and aff'd, 153 N.J. 424, 710 A.2d 421 (1998). The court held that "Aubrey should not be applied to claims under policies issued before the date of the Aubrey decision," and remanded for an order compelling arbitration of Grant's UIM claim. II As explained fully in Breen, supra, 153 N.J. at 428-429, 431-433, 710 A.2d at 423-424, 425-426, the Appellate Division's rationale in both Grant and Breen for applying Aubrey only prospectively rested on a flawed premise concerning the scope of our disapproval in Aubrey of Landi v. Gray, 228 N.J.Super. 619, 550 A.2d 768 (App.Div.1988). We stated explicitly in Breen that "as amplified by French, our disapproval of Landi should be understood to refer only to the Landi court's invalidation of the exclusion of UIM coverage when an underinsured vehicle of a resident family member caused the claimant's injury." Breen, supra, 153 N.J. at 429, 710 A.2d at 423-424. Accordingly, as in Breen, the Grant panel's holding that Aubrey should be applied only prospectively was not necessary to sustain that court's disposition of Grant's appeal. We also observed in Breen, relying on French v. New Jersey School Board Ass'n Insurance Group, 149 N.J. 478, 487, 694 A.2d 1008 (1997), "that a policy `held' by the claimant for purposes of satisfying the statutory standard that determines whether a tortfeasor's vehicle is underinsured need not necessarily be the policy purchased by the claimant." Breen, supra, 153 N.J. at 430, 710 A.2d at 424. In French, supra, we explained that for a claimant who satisfies the threshold for UIM coverage the statute contemplates that the insured is free to pursue UIM benefits under other policies under which he or she may be insuredwhether under his or her personal policy, as the occupant of an employer's vehicle, the permissive occupant of a motor vehicle owned by any other insured person, or as the resident in the household of a relative possessing his or her own UIM insurance. Each of those UIM policies is opened up to the insured once the threshold test is met. [149 N.J. at 495, 694 A.2d 1008 (emphasis added).] We also stressed in Breen that policy language is the critical factor in UIM coverage litigation. 153 N.J. at 430-431, 710 A.2d at 424-425. Because the facts essential to a resolution of the coverage question are undisputed, and the policy language is dispositive, we discern no need for a plenary hearing as urged by Amica to resolve the issue of Grant's reasonable expectations. By its terms the Amica policy's UIM coverage was available to Grant's brother Michael, the named insured, and to "any family member." Although the 428 Amica policy's UM/UIM endorsement as it appears in the record does not define family member, that term indisputably applies to Grant who resided with his brother at the time of the accident. Based on the plain language of the Amica policy, we conclude that the policy's UIM coverage was "held" by Grant and that the policy's UIM coverage is available to compensate Grant for his injuries. See Breen, supra, 153 N.J. at 430-432, 710 A.2d at 424-425. III As in Breen, we disapprove of those portions of the Appellate Division's disposition that determined that the retroactivity of Aubrey was germane to the result and that accorded Aubrey only prospective effect. As modified, we affirm the judgment of the Appellate Division. For modification and affirmanceChief Justice PORITZ and Justices HANDLER, POLLOCK, O'HERN, GARIBALDI, STEIN and COLEMAN7. Opposednone.	{ "pile_set_name": "FreeLaw" }
In The Court of Appeals Sixth Appellate District of Texas at Texarkana No. 06-16-00132-CR AARON CUTHBERT MOONA, Appellant V. THE STATE OF TEXAS, Appellee On Appeal from the Criminal District Court No. 2 Tarrant County, Texas Trial Court No. 1444745D Before Morriss, C.J., Moseley and Burgess, JJ. Memorandum Opinion by Justice Moseley MEMORANDUM OPINION Aaron Cuthbert Moona has filed a motion to dismiss this appeal. The motion was signed by both Moona and his appellate counsel in compliance with Rule 42.2(a) of the Texas Rules of Appellate Procedure. See TEX. R. APP. P. 42.2(a). As authorized by Rule 42.2(a), we grant the motion. See id. Accordingly, we dismiss this appeal. Bailey C. Moseley Justice Date Submitted: October 25, 2016 Date Decided: October 26, 2016 Do Not Publish 2	{ "pile_set_name": "FreeLaw" }
J-S02033-17 NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37 COMMONWEALTH OF PENNSYLVANIA IN THE SUPERIOR COURT OF PENNSYLVANIA Appellee v. JARON AMBROSE Appellant No. 2227 EDA 2015 Appeal from the Order June 26, 2015 In the Court of Common Pleas of Philadelphia County Criminal Division at No(s): CP-51-CR-0008198-2011 BEFORE: FORD ELLIOTT, P.J.E., STABILE, J., and MOULTON, J. MEMORANDUM BY MOULTON, J.: FILED AUGUST 03, 2017 Jaron Ambrose appeals from the June 26, 2015 order entered in the Philadelphia County Court of Common Pleas dismissing his petition filed pursuant to the Post Conviction Relief Act (“PCRA”), 42 Pa.C.S. §§ 9541-46. We affirm. The PCRA court comprehensively set forth the factual and procedural history of this case in its June 26, 2015 order and opinion, which we adopt and incorporate herein. See Order and Opinion, 6/26/15, at 1-3 (“PCRA Ct. Op.”). Ambrose filed the instant PCRA petition, pro se, on January 31, 2014. On March 13, 2015, appointed PCRA counsel filed an amended petition. On May 28, 2015, the PCRA court sent notice of its intent to dismiss Ambrose’s petition pursuant to Pennsylvania Rule of Criminal Procedure 907. On June J-S02033-17 11, 2015, Ambrose filed a response letter originally addressed to PCRA counsel. On June 26, 2015, the PCRA court dismissed the petition. Thereafter, Ambrose filed a timely notice of appeal.1 Ambrose raises the following issues on appeal: Did the trial court err when it denied [Ambrose] post- conviction relief in the form of a new trial based on the ineffectiveness of trial counsel and after-discovered evidence in the absence of an evidentiary [hearing]?[2] A. Is [Ambrose] entitled to a new trial or a remand for an evidentiary hearing since trial counsel was ineffective when he abdicated his responsibility as counsel to make legal determinations that were in the best interest of [Ambrose] by failing to request a mistrial after a juror was approached by a member of the deceased victim’s family? B. Is [Ambrose] entitled to a new trial or a remand for an evidentiary hearing since appellate counsel was ineffective for arguing in the direct appeal that the trial court should have sua sponte declared a mistrial? C. Is [Ambrose] entitled to a new trial or a remand for an evidentiary hearing since trial counsel was ineffective when he failed to file and litigate a motion to suppress identification? ____________________________________________ 1 On November 23, 2015, Barnabay C. Wittels, Esquire, who was Ambrose’s PCRA counsel, entered his appearance in the instant appeal. Thereafter, he filed an application to withdraw as counsel, which this Court denied on February 2, 2016. On February 10, 2016, Attorney Wittels filed an application for reconsideration of the Court’s order. On April 18, 2016, this Court denied the application without prejudice to Attorney Wittels’ right to apply to the PCRA court for the requested relief. On May 6, 2016, the PCRA court appointed Mitchell S. Strutin, Esquire, to represent Ambrose. 2 We will not address separately this introductory issue, as it merely summarizes the remaining issues Ambrose has raised on appeal. -2- J-S02033-17 D. Is [Ambrose] entitled to a new trial or a remand for an evidentiary hearing since trial counsel was ineffective when he failed to conduct a pretrial investigation? E. Is [Ambrose] entitled to a new trial or a remand for an evidentiary hearing since trial counsel was ineffective when he failed to request DNA testing be performed on the gun retrieved, the fired cartridge casings and the magazine? F. Is [Ambrose] entitled to a new trial or a remand for an evidentiary hearing as a result of after-discovered evidence based upon misconduct allegations against Detectives James Pitts and Ohmarr Jenkins? G. Is [Ambrose] entitled to a new trial or a remand for an evidentiary hearing since PCRA counsel was ineffective for failing to raise in the amended PCRA petition trial counsel’s ineffectiveness for failing to object to the admissibility of [Ambrose]’s Facebook photo as a denial of [Ambrose]’s right to confrontation since the photo was not authenticated? H. Is [Ambrose] entitled to a new trial or a remand for an evidentiary hearing since PCRA counsel was ineffective for failing to raise in the amended PCRA petition trial counsel’s ineffectiveness for failing to object to the Commonwealth’s introduction of inadmissible hearsay? I. Is [Ambrose] entitled to a new trial or a remand for an evidentiary hearing since PCRA counsel was ineffective for failing to raise in the amended PCRA petition the issue of the prosecutor’s misconduct for failing to disclose DNA testing which was conducted by Police Officer Edward Fidler and trial counsel’s ineffectiveness for failing to investigate and raise this issue at trial? Ambrose’s Br. at 4-6. Our standard of review from the denial of PCRA relief “is limited to examining whether the PCRA court’s determination is supported by the evidence of record and whether it is free of legal error.” Commonwealth v. Ousley, 21 A.3d 1238, 1242 (Pa.Super. 2011). -3- J-S02033-17 Further, “[t]he right to an evidentiary hearing on a post-conviction petition is not absolute.” Commonwealth v. Jordan, 772 A.2d 1011, 1014 (Pa.Super. 2001). If a claim is “patently frivolous and is without a trace of support in either the record or from other evidence[,]” a PCRA court may decline to hold an evidentiary hearing. Id. “[O]n appeal, [this Court] must examine each of the issues raised in the PCRA petition in light of the record in order to determine whether the PCRA court erred in concluding that there were no genuine issues of material fact and denying relief without an evidentiary hearing.” Id. Ambrose’s first five issues (A through E) raise claims for ineffective assistance of his counsel. When analyzing ineffectiveness claims, we begin with the presumption that counsel was effective. Commonwealth v. Spotz, 18 A.3d 244, 259-60 (Pa. 2011). “[T]he defendant bears the burden of proving ineffectiveness.” Commonwealth v. Ligons, 971 A.2d 1125, 1137 (Pa. 2009). To overcome the presumption of effectiveness, a PCRA petitioner must demonstrate that: “(1) the underlying substantive claim has arguable merit; (2) counsel whose effectiveness is being challenged did not have a reasonable basis for his or her actions or failure to act; and (3) the petitioner suffered prejudice as a result of counsel’s deficient performance.” Id. “A claim of ineffectiveness will be denied if the petitioner’s evidence fails to meet any of these prongs.” Id. -4- J-S02033-17 In Ambrose’s first issue, he argues that his trial counsel was ineffective for failing to move for a mistrial after a member of the victim’s family spoke to a juror during a lunch break prior to closing arguments. Our Supreme Court has stated: [T]he remedy of a mistrial is an extreme one. . . . It is primarily within the trial court’s discretion to determine whether Appellant was prejudiced by the event that forms the substance of the motion. Finally, it must be remembered that a mistrial is required only when an incident is of such a nature that its unavoidable effect is to deprive the appellant of a fair and impartial trial. Commonwealth v. Lease, 703 A.2d 506, 508 (Pa.Super. 1997) (quoting Commonwealth v. Montgomery, 626 A.2d 109, 112-13 (Pa. 1993)). On direct appeal, Ambrose claimed the trial court erred in failing to declare a mistrial sua sponte.3 We concluded the trial court did not err, reasoning: Here, the trial court dismissed the juror who was actually approached and thoroughly interviewed every other juror with regard to what he or she may or may not have heard. Moreover, each juror testified unequivocally that he or she could render a fair and impartial verdict. Moreover, [Ambrose] was colloquied and elected to proceed. Accordingly, we conclude that the trial court did not abuse its discretion when it did not grant a mistrial sua sponte as there was no manifest necessity to do so. ____________________________________________ 3 Because a claim of ineffectiveness “raises a distinct issue for purposes of the PCRA,” Commonwealth v. Collins, 888 A.2d 564, 573 (Pa.2005), we conclude that this claim for ineffective assistance of counsel is not barred for having been previously litigated. -5- J-S02033-17 Commonwealth v. Ambrose, No. 698 EDA 2013, unpublished memorandum at 6 (Pa.Super. filed Dec. 4, 2013). Accordingly, because we previously concluded that a mistrial was not necessary, the underlying claim of Ambrose’s first issue lacks arguable merit. The PCRA court therefore did not err in finding that Ambrose’s trial counsel was not ineffective. In his second issue, Ambrose contends that his appellate counsel was ineffective for arguing on direct appeal that the trial court should have sua sponte declared a mistrial in light of the contact between the juror and family member. Ambrose claims that appellate counsel “should never have made this argument.” Ambrose’s Br. at 24. Rather, Ambrose argues that the decision to request a mistrial lay with trial counsel, and not with Ambrose himself or the trial court. Because we previously concluded that a mistrial was not necessary, the underlying claim lacks arguable merit. Further, there is no merit to the argument that only counsel could have requested a mistrial. Cf. Commowealth v. Kelly, 797 A.2d 925, 936 (Pa.Super. 2002) (“It is within a trial judge’s discretion to declare a mistrial sua sponte upon the showing of manifest necessity, and absent an abuse of that discretion, we will not disturb his or her decision.”). Accordingly, Ambrose cannot show that he was prejudiced by appellate counsel’s performance. Thus, we conclude that appellate counsel was not ineffective. Ambrose next argues that his trial counsel was ineffective for failing to file a motion to suppress identification testimony from a Commonwealth -6- J-S02033-17 witness, Shaquita Morton. The PCRA court concluded that Ambrose’s underlying claim, that Morton’s identification testimony should have been suppressed, had no arguable merit, and thus, counsel was not ineffective for failing to file a motion to suppress. After our review of the certified record, the parties’ briefs, and the relevant law, we conclude the PCRA court did not err for the reasons stated in the PCRA court’s opinion, which we adopt and incorporate herein. See PCRA Ct. Op. at 6-9. Ambrose next argues that his trial counsel was ineffective for failing to conduct a pretrial investigation. Ambrose claims that “[t]here is no evidence that trial counsel hired an investigator, sought out witnesses or did anything other than react to the discovery provided to him by the Commonwealth.” Ambrose’s Br. at 27. We first examine the part of Ambrose’s claim regarding trial counsel’s alleged failure to investigate witnesses. To demonstrate the arguable merit of [an] underlying claim that his trial counsel was ineffective in failing to present additional witnesses, Appellant must establish the existence of and the availability of the witnesses, counsel's actual awareness, or duty to know, of the witnesses, the willingness and ability of the witnesses to cooperate and appear on the defendant’s behalf and the necessity for the proposed testimony in order to avoid prejudice. Moreover, Appellant must show how the uncalled witnesses’ testimony would have been beneficial under the circumstances of the case. Commonwealth v. Gibson, 951 A.2d 1110, 1133–34 (Pa. 2008) (citations and internal quotation omitted). -7- J-S02033-17 At trial, after Ambrose’s counsel informed the court that he did not intend to present any testimony or evidence on Ambrose’s behalf, and that Ambrose did not intend to testify, the court colloquied Ambrose. The following exchange occurred: THE COURT: The first thing is, I know you have been communicating with [your counsel] Mr. Joseph and consulting with him and he’s been talking with you as he examined witnesses. So the first question I have to you, when he makes the representation that he has no testimony to present or witnesses to present, are you in agreement with that decision? [AMBROSE]: Yes. THE COURT: Is there anyone that you want him to call or subpoena to court and they have not arrived? [AMBROSE]: No. THE COURT: Are you comfortable in that decision that you have had enough time speak with your attorney and he’s answered all of your questions? [AMBROSE]: Yes. N.T., 12/6/12, at 84-85. In addition, Ambrose failed to identify the witnesses he believes counsel failed to investigate,4 either in his amended PCRA petition5 or in his appellate brief. Therefore, we agree with the PCRA ____________________________________________ 4 In his amended PCRA petition, Ambrose alleged that trial counsel also failed to interview and call alibi witnesses. Amend. PCRA Pet. at 10. He also averred that PCRA counsel was awaiting information from Ambrose regarding the witnesses for the purpose of obtaining affidavits. Id. at n.1. The certified record does not contain any such affidavits. 5 In his original pro se PCRA petition, Ambrose listed Shikeda Johnson as a potential witness. However, Johnson testified at trial, N.T., 12/5/12, at (Footnote Continued Next Page) -8- J-S02033-17 court that trial counsel was not ineffective for allegedly failing to investigate witnesses. We also conclude that Ambrose’s claim trial counsel was ineffective for failing to hire an investigator or for failing to do “anything other than react” to the Commonwealth’s discovery likewise does not warrant relief. Ambrose cites no legal authority obligating trial counsel to hire an investigator, nor is this Court aware of such a duty; thus, the underlying claim is without merit. The case on which Ambrose relies for his claim that counsel did nothing but react to the Commonwealth’s discovery, Von Moltke v. Gillies, 332 U.S. 708 (1948), is irrelevant and contains no support for his claim. Thus, we conclude that the underlying claim lacks merit. _______________________ (Footnote Continued) 25-68, and the certification attached to Ambrose’s pro se petition indicates that Johnson’s proposed testimony would support Ambrose’s after- discovered evidence claim, not a claim based on counsel’s alleged failure to investigate witnesses. Additionally, according to the PCRA court, in Ambrose’s response to the court’s Rule 907 notice, which is not part of the certified record, Ambrose identified an unknown United States mail carrier as a potential witness. PCRA Ct. Op. at 14-15. The PCRA court states that this witness was presumably Elizabeth Gilbert. Id. at 14. Detective James Pitts testified at trial that someone contacted Gilbert several days after the crime to inquire whether she was the mail carrier for the street on which the crime occurred. N.T., 12/5/12, at 56. Later, Gilbert’s supervisor contacted Detective Pitts, informing him that Gilbert no longer wanted to be involved in the case, was afraid, and had indicated that “she could never identify anyone and was ultimately moved off that route.” Id. -9- J-S02033-17 Ambrose next argues that his trial counsel was ineffective for failing to request DNA testing on the recovered gun, fired cartridge casings, and gun magazine. At a pre-trial hearing on November 29, 2012, Ambrose expressly declined DNA testing of the murder weapon and waived his right to “later claim that there is possible DNA evidence that could exonerate” him. N.T., 11/29/12, at 7. As the trial court stated, “[I]n other words, if you were to be convicted, you can’t later say I want a new trial because the DNA testing was never done.” Id. Our Supreme Court has stated that counsel cannot be deemed ineffective for acting in conformity with his or her client’s instructions. Commonwealth v. Chmiel, 889 A.2d 501, 546 (Pa. 2005). Accordingly, we agree with the PCRA court’s conclusion that counsel was not ineffective for the reasons stated in the PCRA court’s opinion, which we adopt and incorporate herein. See PCRA Ct. Op. at 15-18. In Ambrose’s sixth issue, he contends that he is entitled to a new trial based on after-discovered evidence of the alleged misconduct of two detectives involved in Ambrose’s case. A PCRA petitioner may be eligible for relief if he pleads and proves by a preponderance of the evidence that his conviction resulted from “[t]he unavailability at the time of trial of exculpatory evidence that has subsequently become available and would have changed the outcome of the trial if it had been introduced.” 42 Pa.C.S. § 9543 (a)(2)(vi). To establish a right to a new trial based on after- discovered evidence: - 10 - J-S02033-17 appellant must show the evidence: 1) has been discovered after trial and could not have been obtained at or prior to the conclusion of trial by the exercise of reasonable diligence; 2) is not merely corroborative or cumulative; 3) will not be used solely to impeach a witness's credibility; and 4) is of such a nature and character that a different verdict will likely result if a new trial is granted. Commonwealth v. Cousar, 154 A.3d 287, 311 (Pa. 2017). Ambrose argues that the detectives’ misconduct was documented in a November 5, 2013 newspaper article that was attached to Ambrose’s pro se PCRA petition. Ambrose’s Br. at 30. The Supreme Court addressed a similar argument in Commonwealth v. Castro, 93 A.3d 818 (Pa. 2014). In Castro, the Court concluded that the newspaper article in that case was not evidence6 for purposes of the ____________________________________________ 6 The Court explained why the article was not evidence: We need not belabor the question of whether a newspaper article is evidence – the parties agree the article itself is not evidence.11 The Superior Court erred in treating the article as containing evidence; the article contains allegations that suggest such evidence may exist, but allegations in the media, whether true or false, are no more evidence than allegations in any other out-of-court situation. Nothing in these allegations, even read in the broadest sense, can be described as “evidence,” and references to the officer being under investigation for misconduct contains no information regarding what evidence existed to substantiate this averment. One cannot glean from these bald allegations what evidence of misconduct appellee intended to produce at the hearing. As the articles themselves were not evidence, much less sufficient evidence, we instead focus on whether the (Footnote Continued Next Page) - 11 - J-S02033-17 appellant’s post-sentence motion for a new trial based on after-discovered evidence. Id. at 826. Moreover, because the newspaper article represented the reporter’s version of what he or she had been told by another person, the Court found that it was double hearsay. Id. The Court distinguished Castro from Commonwealth v. Brosnick, 697 A.2d 725 (Pa. 1992), in which the Court remanded for a new trial. In Brosnick, the appellant, who had been convicted of driving under the influence, learned from a newspaper article that the Pennsylvania Auditor General was investigating “the company that manufactured items used to test the accuracy of breath-testing machines. The ensuing report [from the Auditor General] attacked the credibility of the machines’ certificates of accuracy.” Id. at 826–27. The appellant then moved for a new trial, citing the report rather the newspaper article. Id. at 827. The Castro Court found that, unlike Brosnick, there was no “end product here, no published report, no findings made, no charges filed.” Id. It concluded that “[w]hile newspaper articles can alert a party to the possible existence of evidence, the party must do more than _______________________ (Footnote Continued) information described in the March 30 article can otherwise serve as the basis for appellee's claim. 11 This Court and the Commonwealth and Superior Courts have held newspaper articles generally do not constitute evidence, as they contain inadmissible hearsay. Castro, 93 A.3d at 825–26 (internal citations omitted). - 12 - J-S02033-17 attach the article as establishing the evidence that will meet the four- pronged test.” Id. Ambrose contends that because the detectives involved in his case have been removed from their positions and because “some of the convictions in cases in which they were involved” have been overturned, “[t]his calls into question the propriety of the investigation and the tactics employed and utilized to obtain witness statements and identification.” Ambrose’s Br. at 32. Ambrose baldly asserts that “[i]n the instant matter, witnesses were prepared to testify that they were pressured, intimidated and threatened into giving inculpatory statement[s] and testimony against” him, id.; notably, however, in his brief he does not identify any of the witnesses. As stated above, in his pro se PCRA petition, Ambrose asserted that Shikeda Johnson could testify as to possible police misconduct in relation to this matter. Specifically, Johnson would testify that she gave statements to police and testified because “she was pressured, intimidated, [and] possibly threatened” by Detective Pitts and “possibly Robyn Alston[.]” PCRA Pet. at 7. However, Ambrose has failed to established that “the evidence was discovered after trial and could not have been obtained at or prior to the conclusion of trial by the exercise of reasonable diligence.” Cousar, 154 A.3d at 311. At trial, Johnson testified as follows: Q. Did [the police] say that they were going to take [your] child from you? - 13 - J-S02033-17 A. Yeah. They were threatening me. Q. Is that why you gave the statement? A. No. They asked me questions and I answered them. But this right here is not what I'm saying. He put extra stuff in here. Q. So what's the extra stuff that he put in? A. The big paragraph right here. Q. You didn't say any of that? A. No. He put it in his words. That's not how I put it in mind. N.T., 12/5/12, at 58. Johnson further testified that although she was asked to review her statement for accuracy and then sign it, which she did, she was “trying to sign it and go get [her] child.” Id. at 65. She testified that a police officer told her that the quicker she signed her statement, the quicker she could “get out to be with [her] child.” Id. at 67. Ambrose does not explain why any testimony regarding possible police misconduct could not have been obtained before the conclusion of trial by the exercise of reasonable diligence. Therefore, Ambrose is not entitled to relief on his after-discovered evidence claim. Additionally, we conclude that Ambrose’s last three issues, which claim ineffectiveness of PCRA counsel, cannot be reviewed for the first time on appeal. See Commonwealth v. Henkel, 90 A.3d 16, 20, 30 (Pa.Super. 2014) (en banc) (holding that “claims of PCRA counsel's ineffectiveness may not be raised for the first time on appeal” and that such claims are unreviewable); Commonwealth v. Ford, 44 A.3d 1190, 1201 (Pa.Super. - 14 - J-S02033-17 2012) (holding that “absent recognition of a constitutional right to effective collateral review counsel, claims of PCRA counsel ineffectiveness cannot be raised for the first time after a notice of appeal has been taken from the underlying PCRA matter”). Finally, because there were no genuine issues of material fact, we conclude that the PCRA court properly dismissed Ambrose’s PCRA petition without an evidentiary hearing. Order affirmed. Judgment Entered. Joseph D. Seletyn, Esq. Prothonotary Date: 8/3/2017 - 15 - Circulated 07/11/2017 10:51 AM	{ "pile_set_name": "FreeLaw" }
IN THE COURT OF APPEALS OF IOWA No. 17-1407 Filed December 6, 2017 IN THE INTEREST OF R.C., Minor Child, A.C., Father, Appellant. ______________________________________________________________ Appeal from the Iowa District Court for Polk County, Romonda D. Belcher, District Associate Judge. A father appeals the juvenile court order terminating his parental rights. AFFIRMED. Thomas A. Hurd of Glazebrook & Hurd, L.L.P., Des Moines, for appellant. Thomas J. Miller, Attorney General, and Meredith L. Lamberti, Assistant Attorney General, for appellee State. ConGarry D. Williams, State Public Defender’s Office, Des Moines, guardian ad litem for minor child. Considered by Vogel, P.J., and Tabor and Bower, JJ. 2 BOWER, Judge. A father appeals the juvenile court order terminating his parental rights. We find there is clear and convincing evidence in the record to support termination of the father’s rights. We also find termination is in the child’s best interests. We affirm the decision of the juvenile court. I. Background Facts & Proceedings A.C., father, and M.C., mother, are the parents of a child, R.C., born in 2014. The parents have a history of substance abuse. The child was removed from the parents’ care on July 28, 2016, after the mother became intoxicated and abandoned the child near an intersection. The mother was charged with public intoxication, child endangerment, and assault on a police officer. The father stated he had recently used methamphetamine and was not in a position to safely parent the child. On removal, a hair test of the child was positive for methamphetamine and marijuana. The child was placed in the care of a maternal great-aunt. The child was adjudicated to be in need of assistance (CINA) pursuant to Iowa Code section 232.2(6)(c)(2) and (n) (2016). Until January 2017 the father had very limited contact with employees of the Iowa Department of Human Services (DHS). The child was hospitalized in February 2017 and restraints were necessary to keep the child from removing a tube in her nose. The parents removed one of the restraints, the young child removed the tubing, and medical personnel had to reinsert the tube, causing the child additional pain. In April 2017, DHS requested the father wear a drug patch and he refused. He did not 3 participate in substance abuse treatment or mental health counseling. The father was inconsistent in exercising visitation with the child. On May 8, 2017, the State filed a petition seeking termination of the parents’ rights. At the termination hearing, held on July 6, 2017, the juvenile court ordered the father to submit to a drug test that day. The test was positive for marijuana, amphetamine, and methamphetamine. The court terminated the father’s parental rights under section 232.116(1)(h) (2017).1 The court found termination was in the child’s best interests, noting “ongoing concerns about the safety of the child if returned to the care of either parent.” The father now appeals the termination of his parental rights. II. Standard of Review The scope of review in termination cases is de novo. In re D.W., 791 N.W.2d 703, 706 (Iowa 2010). Clear and convincing evidence is needed to establish the grounds for termination. In re J.E., 723 N.W.2d 793, 798 (Iowa 2006). Where there is clear and convincing evidence, there is no serious or substantial doubt about the correctness of the conclusions drawn from the evidence. In re D.D., 653 N.W.2d 359, 361 (Iowa 2002). The paramount concern in termination proceedings is the best interests of the children. In re L.L., 459 N.W.2d 489, 493 (Iowa 1990). III. Sufficiency of the Evidence The father claims there was not clear and convincing evidence in the record to support termination of his parental rights. He claims the State failed to meet its burden to show the child could not be returned to his care. He states he 1 The mother’s parental rights were also terminated. She has not appealed. 4 has a close bond with the child. He claims there was no evidence to show any substance abuse or mental health concerns would prevent him from caring for the child. We find there is sufficient evidence in the record to support termination of the father’s parental rights. At the time of removal, the father told social workers he could not safely parent the child because he had been using methamphetamine. He refused the only drug testing request during the case, in April 2017. He did not participate in treatment for substance abuse. On the day of the termination hearing, the father tested positive for multiple controlled substances. We conclude the evidence shows the child could not be safely returned to the father’s care because he has not taken any steps to address his substance abuse issues. IV. Best Interests The father claims termination of his parental rights is not in the child’s best interests. In determining children's best interests, we “give primary consideration to the child’s safety, to the best placement for furthering the long-term nurturing and growth of the child, and to the physical, mental, and emotional condition and needs of the child.” Iowa Code § 232.116(2); In re P.L., 778 N.W.2d 33, 39 (Iowa 2010). We find termination of the father’s parental rights is in the child’s best interests. Although the child was removed in July 2016, the father had very limited contact with DHS until January 2017. Initially, he did not attend any visits or participate in any services. Even after he began attending visits with the child 5 in February 2017, he continued to be inconsistent in attendance—sometimes missing visits and sometimes arriving late. The father’s actions regarding visitation and in failing to address his substance abuse problems show he was unable to meet the needs of the child. We affirm the decision of the juvenile court. AFFIRMED.	{ "pile_set_name": "FreeLaw" }
03/26/2018 IN THE COURT OF CRIMINAL APPEALS OF TENNESSEE AT NASHVILLE Assigned on Briefs December 13, 2017 STATE OF TENNESSEE v. ADAM DAVIS Appeal from the Circuit Court for Montgomery County No. 2015-CR-611 William R. Goodman, III, Judge ___________________________________ No. M2017-00293-CCA-R3-CD ___________________________________ Following a bench trial, the Defendant-Appellant, Adam Davis, was convicted of two counts of aggravated sexual battery, a Class B felony. See T.C.A. § 39-13-504. The trial court sentenced him as a Range I, standard offender to a concurrent term of eight years’ imprisonment. The sole issue presented for our review is whether the evidence is sufficient to support his convictions. After a thorough review of the record and briefs, we affirm the judgments of the trial court. Tenn. R. App. P. 3 Appeal as of Right; Judgments of the Circuit Court Affirmed CAMILLE R. MCMULLEN, J., delivered the opinion of the court, in which NORMA MCGEE OGLE and TIMOTHY L. EASTER, JJ., joined. Roger E. Nell, District Public Defender, Clarksville, Tennessee (on appeal) and Crystal L. Myers, Assistant Public Defender, Clarksville, Tennessee (at trial), for the appellant, Adam Davis. Herbert H. Slatery III, Attorney General and Reporter; Jonathan H. Wardle, Assistant Attorney General; John W. Carney, District Attorney General; and Kimberly Lund, Assistant District Attorney General, for the appellee, State of Tennessee. OPINION The Defendant was indicted on several counts of aggravated sexual battery and rape of a child for forcing the victim, A.T., his girlfriend’s six-year-old daughter, to engage in various sexual acts including oral-oral contact, penile-oral contact, and penile- digital contact from April to December 2014.1 At trial, the victim’s mother testified that she met the Defendant in high school and lived with him from October 2011 to January 1 It is the policy of this court to refer to minor victims and their family members by their initials. 2015. In April 2014, they lived together in a home on Oak Park Court in Clarksville, Tennessee. The victim and her brother had their own rooms, and the Defendant and the victim’s mother shared a room. The victim’s mother observed the Defendant’s behavior around the victim and described it as normal. During the offense timeframe, the victim’s mother worked long hours, and the Defendant watched the children for her. The victim’s mother recalled that sometimes the victim would cry when she left for work. The victim’s mother explained that the children acknowledged privacy in their home, went into their own rooms to change clothes, and closed the doors when changing or showering. The children never observed her and the Defendant engaged in sexual activity. Although she had not yet had the “birds and bees” conversation with the victim, the topic of appropriate and inappropriate touching was discussed in school. The victim’s mother reviewed the materials sent home by the school and ensured the victim understood them. After the victim told her mother about the Defendant’s sexual abuse, the victim’s mother called and confronted the Defendant, who denied everything. The victim’s mother testified that she did not return home that day. However, because of their financial connection, she maintained a brief relationship with the Defendant. The Defendant gave the victim’s mother rides to and from work during which he tried to convince her of his innocence. Finally, the victim’s mother confirmed that she never told the victim what to say during this process. On cross-examination, the victim’s mother said the victim was not having trouble in school in April 2014. She also confirmed that prior to April 2014, they lived with the Defendant’s mother and shared one room with the children. Although the Defendant had back surgery in May 2014, he was able to take care of the children. However, the victim’s mother bathed the children exclusively, except on one or two occasions. When she confronted the Defendant with the victim’s allegations, he provided the following explanations: (1) “[the victim] probably overheard some noises from our bedroom and then had a bad dream”; (2) “[the victim’s mother] shouldn’t throw away [their] relationship when it’s going to come out in a few days that [the victim] lied and then [they] won’t be able to reverse the damage from this”; (3) “[the victim’s] been very upset when [the victim’s mother has] to work nights and it was only a matter of time before [the victim] came up with something to say and try to get [the victim’s mother] to stay home”; and (4) “[h]ow silly this all was and how [the victim’s mother knew] what kind of person he is. [She knew] he could never do anything like that.” The victim’s mother also confirmed that she sent the following text message to the Defendant’s mother: -2- Yes, ma’am, I understand. I told [the Defendant] I don’t feel 100 percent that he did it, but . . . thoughts kept crossing my mind and I can’t turn it off, no matter what he says. And we can’t keep a relationship going like that. I will still call the De[t]ective on Monday, and let him know I’m questioning her version of everything also. I don’t want this to end badly for him no matter what happens. The Defendant later helped the victim’s mother purchase a car, which she felt “he owed [them], after everything that [they] had gone through.” Even though the victim’s mother briefly continued her relationship with the Defendant, she believed her daughter. The minor victim was nine years old at the time of trial and six to seven years old at the time of the offenses. Without objection, she testified at trial and promised to tell the truth during her testimony. With the aid of a girl diagram, the victim identified the body parts that no one is supposed to touch. She then marked an X on the lips, belly, genitalia, and buttocks to illustrate where the Defendant inappropriately touched her. On a boy diagram, she marked an X on the lips, belly, genitalia, and buttocks to illustrate the body parts with which the Defendant inappropriately touched her. These diagrams were admitted into evidence as exhibits 1 and 2, respectively. The victim told her mother what the Defendant did to her because she “did not want to do that anymore.” She testified that she spoke with “a lady” about the abuse, identified a digital versatile disk (DVD) of her interview, and confirmed that everything she said in the DVD was true. The DVD of the forensic interview was then admitted into evidence, without objection, as exhibit 3, and played for the court. The DVD showed that on January 20, 2015, the victim was interviewed at Our Kids concerning allegations of child sexual abuse.2 The DVD began with the interviewer asking the victim some preliminary questions including: “What were her favorite board games?”; “Who were her brother and sister?”; and “What she did the previous weekend?”.3 The interviewer then asked to talk with the victim about “why [she] had to come here?”. In response, the victim told the interviewer that the Defendant was “doing bad things” to her, “like the private area thing” with her. The victim complied with the Defendant because she was “supposed to listen to parents,” and she “did not know he was doing a bad thing.” 2 Our Kids is a medical evaluation and crisis counseling center that specializes in services for children when there are allegations or concerns of child sexual abuse. 3 The forensic interview was not transcribed; therefore, these statements may not be verbatim. -3- The victim said that the Defendant told her to “keep it a secret,” and she “accidentally promised him.” Asked what the Defendant did to her, the victim said “the private area thing with me, touching it.” Asked what the Defendant touched, the victim patted her lap near her genitalia with her hands and said that he touched “the whole private area.” The victim initially stated that she never saw the Defendant’s genitalia but then remembered that she did see it “accidentally.” She said, “I know it’s gross [and] disgusting. [H]e literally put it in my mouth.” The victim confirmed that the abuse occurred in the house on her mother’s bed or on the couch when her mother was not there and her brother was asleep. The abuse “only happened at nap time,” never at night or in the morning, and occurred “last year when it was still hot.” The victim explained that the Defendant would ask her if she wanted to go to sleep with him or in her own bed during naptime. Because she “did not really want to go to sleep,” sometimes she “accidentally said ‘sleep with him[.]’” “[T]he first time [the victim] said ‘sleep with him’ . . . [she] did not know he was gonna do that.” She explained that when they were on the couch, the Defendant would put her in his lap, her legs would be “around him or on him,” and the Defendant would “shake” her, “like rocking” her with their clothes on. The Defendant also “wanted [her] to kiss him on the mouth [and cheeks,]” which the victim described as “gross[.]” The interviewer asked the victim to describe a time the Defendant did something to her from beginning to end. In response, the victim initially said, “[the Defendant] did something to me?” The interviewer referred the victim back to her previous comments, and the victim then replied that the Defendant was “putting [his genitalia] in [her] mouth and rubbing and patting” and that the Defendant made her “kiss him on the cheek or lips.” The victim confirmed that the Defendant put his genitalia in her mouth more than once, explained that he made her “suck[] on it,” and described it as “gross,” “weird,” and “wet.” Asked what was the first thing that would happen in bed, the victim said, “patting and also he made me touch it with my hand.” When the Defendant made the victim touch “his private one,” he made her “go up and down with it,” which the victim demonstrated during the interview. She described his “private one” as feeling “really gross” like “dead skin or leaves.” Asked what happened the most, the victim stated “the rubbing and patting and the up and down thing.” She explained that the “rubbing” happened when the Defendant would rub his “private one” on her “private one” and she said that it felt “bad [and] gross. Everything was gross.” The victim could not remember whether the patting occurred on the inside or outside of her genitalia, but thought it was on the outside. She said the “up and down thing” was on the outside of the Defendant’s genitalia, which she again demonstrated with hand motions during the interview. Asked what would make it stop, the victim said that a “waterfall would come out” of the -4- Defendant’s genitalia and that the “water” would either go on his “private one” or on her hand when she was touching him. After the abuse, the Defendant would make the victim “wash down . . . with a washcloth and made [her] wash [her] private areas.” The interviewer then pulled out a diagram of a girl and a boy, and the victim accurately identified which diagram showed the girl and which showed the boy. On the girl diagram, as the interviewer pointed to each body part, the victim identified the “eye, mouth, [nipples], belly button, private area, knee, hair, back, . . . bottom, [and] hand.” On the boy diagram, as the interviewer pointed to each body part, the victim identified the “nose, belly button, . . . private area, . . . back, bottom, [and] foot.” When the interviewer pointed to the boy diagram’s belly button, the victim recalled that “[the Defendant] would lift up his [and her] shirt[s] . . . for [her] belly to be on his belly.” She stated that the Defendant also made her take off her “underwear and pants.” With a marker, the victim then made marks on the girl’s body parts where the Defendant made her “wash up” her bottom and genitalia. Asked if something happened to her bottom and why she had to wash up there, the victim responded that “nothing happened,” and that she was not sure why the Defendant “made [her] wash up” there. She stated that “his private area” touched her bottom more than once and identified those parts on the boy diagram. She explained that when the Defendant’s genitalia touched her bottom, it was “usually . . . patting or rubbing.” Asked what the Defendant’s genitalia looked like, the victim pointed to the boy diagram and said “that.” She stated that it was “bigger because he’s a grown up” and described the color as “not white, [more] tan.” The victim said that no one else other than her doctor had ever touched her genitalia and that the abuse only happened at the Oak Park Court house. She said she was “probably never gonna see [the Defendant] again” and was “ok [because] it was bad that he did that, but we’re safe now.” At some point while the DVD was playing, the victim, who was underneath a table with the court facility dog, began kicking and crying. In response, the court deputies gave her candy and hugged her. Defense counsel objected to this behavior as “coercive,” and the court stopped the DVD. The State argued that it was not coercive because, at the time of the behavior, the victim was not testifying and only the DVD was playing. In addition, the State said that the court had the ability to “set aside tears and kicking” better than a jury, alleviating the need for a mistrial. The trial court expressed the need to remain impartial and stated that it “probably [wa]s not appropriate for court personnel to be giving out candy to witnesses.” However, the court determined the actions were not “coercive, because of the nature of the testimony. It doesn’t affect what’s on the DVD of the forensic interview . . . which was properly authenticated.” The remainder of the video was then played for the court. -5- On cross-examination, the victim testified that she was in first and second grade from April to December 2014. She could not remember her teachers’ names but was able to remember her best friend’s name. The victim shared a room with her mother, her brother, and the Defendant at the Defendant’s mother’s house and had her own room at the Oak Park Court house. At the Oak Park Court house, the Defendant was there most of the time, and the victim’s mother was usually at work. During the forensic interview, the victim was unsure if the incidents with the Defendant happened at the Defendant’s mother’s house; however, she confirmed at trial that they only happened at the Oak Park Court house. She explained that it usually happened in the middle of the day while her brother was taking a nap. The victim denied creating bedtime stories at home and that anyone talked to her about inappropriate touching. Although she did not remember in which month the first incident happened, she was out of school at the time. The victim recalled the last incident occurred the week before she told her mother about the abuse. Lisa Baeza, a social worker at Our Kids, testified regarding her interview of the victim, and her report was admitted into evidence as exhibit 4. Baeza spoke with the victim by herself and with her mother. The victim was seven years old at the time of the interview, was dressed appropriately, and had no problems building a rapport with Baeza. During the interview, the victim identified the part of her body that she urinates from as her “private area,” and the part she defecates from as her “bottom.” The victim told Baeza “that the parts on her body that people should not touch are her private areas and her mouth.” Asked whether anyone had ever touched those areas, the victim stated that the Defendant had. The victim told Baeza that the Defendant touched her genitalia with “his private area” and identified it on the diagram as the body part from which he urinates. The victim explained “that her clothes were off when [the Defendant] touched her” and could not remember whether the Defendant touched her on the “inside” or “outside” of her genitalia. The victim said that this kind of contact happened more than once and that “sometimes . . . it would hurt and at other times, it didn’t.” Additionally, on more than one occasion, the Defendant’s genitalia touched the victim’s hand, the Defendant’s genitalia went into her mouth, and the Defendant kissed the victim on her lips and cheeks. The victim denied that anyone else had ever touched her genitalia. On cross-examination, Baeza confirmed that she provided the child’s presenting history and medical history to the medical provider, Heidi Dennis, who then performed the actual exam. Heidi Dennis, a pediatric nurse practitioner at Our Kids, was tendered as an expert in the field of pediatric forensic examinations. She was advised that the victim’s medical history consisted of oral-oral contact, penile-oral contact, penile-genital contact, and penile-digital contact. Although her exam of the victim revealed “no findings,” Dennis explained that there generally are no physical findings with this type of contact. However, she agreed that “no findings” could also mean that no abuse occurred. -6- At the close of the State’s proof, the State recited its election of offenses for the aggravated sexual battery as follows: the victim’s description of “her hand going up and down on [the Defendant’s] private” (count 2); the “rubbing and patting . . . on [the victim’s] private one with [the Defendant’s] private[,]” and the victim’s description that the Defendant lifted their shirts so their bellies were touching, that her pants and underwear were removed, and that the Defendant “was patting [his private] on the outside [of her] private” (count 4); the Defendant’s “rubbing and patting on her bottom with his private” (count 5); the abuse on the couch when the Defendant “rock[ed] her back-and- forth with her legs straddled around him” while the victim was facing forward watching TV and while she was facing Defendant with their shirts up and bellies touching (counts 6 and 7). Defense Proof. Sharon Connor, the Defendant’s mother, testified that she had a “wonderful relationship” with the victim and her mother during the time that they lived with her. She spent quality time with the victim and remembered that she made up stories when they played with Barbie dolls together. When the Defendant had back surgery in May 2014, she helped with the children while the victim’s mother was at work. She never observed the victim acting strangely towards the Defendant. She recalled the Defendant and the victim bathing together on several occasions when they lived with her. Regardless, she said the Defendant was always “professional” around the victim, never allowed her to sit in his lap, and was never alone with either child. Connor texted the victim’s mother after the reported abuse and recalled the victim’s mother did not completely believe the victim. Connor denied harassing the victim’s mother or coercing her to send the responding text message. The Defendant’s mother confirmed that the Defendant and the victim’s mother continued their relationship “at least . . . three months” until the victim’s mother and her children moved to Ohio. After they moved, Connor stated she kept in touch with them, including “Skyping with [the victim while her mother] would sit there with her.” She stated that the victim wanted to talk to the Defendant, but “knew that she couldn’t.” Connor said the Defendant never left the State after the reported abuse, even though the detectives confirmed he could still travel. The Defendant’s mother recalled overhearing conversations between the Defendant, the victim’s mother, and the victim regarding appropriate and inappropriate touching. Specifically, she remembered them telling the victim that if she were ever touched inappropriately, she needed to tell someone—her mother, the Defendant, a teacher, or a policeman. Connor said that no one had ever made allegations like this against the Defendant before, that she would not support the Defendant if she believed he had done this, and that she would have helped him get help if she knew this was going -7- on. She stated these allegations greatly affected the Defendant’s life, causing him to lose weight, become depressed, and file for bankruptcy. On cross-examination, the Defendant’s mother confirmed that she had been in the victim’s life for approximately three years and that they had a “wonderful relationship[.]” She emphasized that the Defendant was very professional with the victim, never allowed her to sit in his lap, and was never alone with the children. Although she knew most of what happened at her house, she could not be sure of what happened between the Defendant and the children at the Oak Park Court house. Amanda Davis, the Defendant’s estranged wife, stated that she had known the Defendant since they were five years old and that no one had ever made child sexual abuse allegations against him. While stationed in Japan when the Defendant was in the military, she cared for many children as a babysitter. The Defendant was often around those children and no allegations of abuse were ever made against him. She said that if she believed the Defendant had any tendencies to harm children, she would not allow the Defendant to have visitation with their son. She stated that their son had visitation with the Defendant and that she did not believe the Defendant was capable of child sexual abuse. On cross-examination, she reiterated that while they were in Japan, she observed the Defendant having very normal, playful interactions with children. She stated that the Defendant was professional and appropriate with the children at all times and always acted “as an adult should act.” While growing up with the Defendant, his sister, Nikki Davis, often had their friends and cousins come over to the house. Some of the girls stayed at the house overnight, and there were never any allegations of the Defendant inappropriately touching anyone. Davis testified that the Defendant was very protective of her and the women in their family. She has two young boys, and the Defendant was one of the only people she allowed to watch them. She stated that she would not testify on his behalf if she believed the Defendant did this. The Defendant testified that he never inappropriately touched the victim, never rubbed or patted her genitalia, and never put his genitalia in her mouth. He stated that he was honorably discharged from the Air Force in May 2008 due to his back injury. He did contract work from 2010 until he could no longer get a job because of required background checks which included the reported child sexual abuse. The Defendant described his life with the victim’s mother and her two children as “almost perfect,” but stated that his life has now been “devastated” and that he does not know why the victim would “make this up.” Regarding their living arrangements leading up to the reported abuse, he confirmed in large part the testimony of the victim’s mother and his mother. -8- The Defendant stated that he and the victim’s mother had discussed inappropriate touching with the victim. Specifically, the victim was told that it was “terribly inappropriate[,]” that if it happened, it was not her fault, and that she should tell someone she trusted. The Defendant stated that when the victim’s mother confronted him with the reported abuse, he told her to take the victim to the hospital. He denied telling her to “keep it quiet” or come home to discuss things. While he did want to talk to the victim’s mother about what happened, he did not tell her “not to tell anyone” or “not to go to the police[.]” At nighttime, the children made up stories from scratch to encourage their creativity, and the victim was never allowed in his bedroom to sleep. The Defendant stated he continued his relationship with the victim’s mother until she moved to Ohio. The Defendant consistently denied the allegations of sexual abuse against him and voluntarily went to the police station because he “didn’t do anything [and] didn’t have a reason not to go.” In his interview at the police station, the Defendant completely denied the sexual abuse but was arrested in June 2015, approximately six months after the allegations were made. The Defendant testified that he had an “excellent relationship” with the victim, viewed the victim as his own child, and felt “horrible” to hear her make these allegations against him. On cross-examination, the Defendant agreed the stories that the victim made up at bedtime never included “penises with liquid coming from them[,] penises going into mouths[,] penises rubbing genital areas[, or] hands going up and down on a penises[.]” He was “[100] percent sure” that the victim never saw his penis or saw him masturbate or ejaculate. He stated that he had a “good relationship” with the victim and often helped her with math homework and soccer skills. The Defendant denied that the victim sat in his lap or got into bed with him. The Defendant opined the victim possibly saw him engaged in sexual activity with her mother, but he could not be sure. Based on the foregoing evidence, the trial court found the Defendant guilty of two counts of aggravated sexual battery (counts 2 and 4) and not guilty of the remaining counts.4 The trial court subsequently sentenced the Defendant as a Range I, standard offender to eight years for each count, to be served concurrently. After filing a timely notice of appeal, the Defendant’s case is now properly before this court. ANALYSIS I. Sufficiency of the Evidence. In challenging the evidence supporting his aggravated sexual battery convictions, the Defendant contends that the only direct 4 The Defendant was originally charged with five counts of aggravated sexual battery and two counts of rape of a child. -9- evidence of sexual contact was from the forensic interview of the victim which “was infested with prompting and reinforcing a story of abuse rather than being an exercise in truth-finding.” The State maintains that the evidence was wholly sufficient to support the Defendant’s convictions of aggravated sexual battery. Upon review, we agree with the State. When a defendant challenges the sufficiency of the evidence supporting a conviction, the standard of review is “whether, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime beyond a reasonable doubt.” Jackson v. Virginia, 443 U.S. 307, 319 (1979). Similarly, Rule 13(e) of the Tennessee Rules of Appellate Procedure states, “Findings of guilt in criminal actions whether by the trial court or jury shall be set aside if the evidence is insufficient to support the findings by the trier of fact of guilt beyond a reasonable doubt.” This standard applies to convictions based upon direct, circumstantial, or a combination of both direct and circumstantial evidence. State v. Pendergrass, 13 S.W.3d 389, 392-93 (Tenn. Crim. App. 1999). On appeal, the State is entitled to the strongest legitimate view of the evidence and all legitimate or reasonable inferences which may be drawn from that evidence. State v. Bland, 958 S.W.2d 651, 659 (Tenn. 1997). All questions involving the credibility of witnesses, the weight and value to be given the evidence, and all factual issues are resolved by the trier of fact, and this court will not reweigh or reevaluate the evidence. State v. Sutton, 166 S.W.3d 686, 689-90 (Tenn. 2005). This court has stated that “[a] guilty verdict . . . approved by the trial court, accredits the testimony of the witnesses for the State and resolves all conflicts in favor of the prosecution’s theory.” Bland, 958 S.W.2d at 659 (citation omitted). A guilty verdict also “removes the presumption of innocence and replaces it with a presumption of guilt, and the defendant has the burden of illustrating why the evidence is insufficient[.]” Id. (citation omitted). The Defendant was convicted of two counts aggravated sexual battery, a Class B felony, as defined in Tennessee Code Annotated section 39-13-504. In order to sustain a conviction of aggravated sexual battery, the State must prove beyond a reasonable doubt that the Defendant made “unlawful sexual contact with a victim . . . less than thirteen (13) years of age.” T.C.A. § 39-13-504(a)(4). The term “sexual contact” is defined as “the intentional touching of the victim’s, the defendant’s, or any other person’s intimate parts . . . if that intentional touching can be reasonably construed as being for the purpose of sexual arousal or gratification[.]” Id. § 39-13-501(6). The term “intimate parts” is defined as including “semen, vaginal fluid, the primary genital area, groin, inner thigh, buttock or breast of a human being.” Id. § 39-13-501(2). - 10 - The proof supporting the State’s election of offenses supporting the Defendant’s aggravated sexual battery convictions (counts 2 and 4) was based on the victim’s testimony that “her hand [was] going up and down on [the Defendant’s] private,” the “rubbing and patting . . . on [the victim’s] private one with [the Defendant’s] private[,]” the victim’s description that the Defendant lifted their shirts so their bellies were touching while her pants and underwear were removed, and that the Defendant “was patting [his private] on the outside [of her] private.” In this appeal, the Defendant focuses primarily on the fact that the only direct proof of sexual contact offered at trial was from the forensic interview and on inconsistencies in the victim’s testimony at trial and in her interview. He complains that the victim did not provide in court testimony about any sexual contact by the Defendant. Contrary to the Defendant’s assertion, the record shows that the victim did in fact provide testimony at trial regarding the Defendant’s sexual abuse. Specifically, prior to the introduction of the forensic interview, the victim identified on diagrams of a boy and girl the body parts with which the Defendant inappropriately touched her. The DVD of the forensic interview was then admitted into evidence without objection. The DVD contained the victim’s forensic interview which thoroughly detailed the extent of the Defendant’s sexual abuse of the victim. In addition, the victim was present at trial and subject to cross-examination, during which the court was able to assess her credibility. Finally, this court has repeatedly held that the testimony of a minor victim, alone, is sufficient to uphold a conviction. State v. Elkins, 102 S.W.3d 578, 582-83 (Tenn. 2003) (quoting State v. Radley, 29 S.W.3d 532, 537 (Tenn. Crim. App. 1999)); see also State v. Christopher Lee Blunkall, No. M2014-00084-CCA-R3-CD, 2015 WL 500751, at 10 (Tenn. Crim. App. Feb. 5, 2015) (holding that a minor victim’s testimony was sufficient despite lack of corroborating evidence, including the defendant’s semen); State v. Shropshire, 45 S.W.3d 64, 70 (Tenn. Crim. App. 2000) (affirming a conviction for aggravated sexual battery where “the victim testified that she was under thirteen (13) years old at the time of the incident in question, and that the defendant forced her to touch his penis”). Although the nine-year-old victim did not restate in detail at trial the abuse as described in her forensic interview, the trial court assessed her credibility and resolved any seeming inconsistencies with the challenged convictions in the State’s favor. Here, the victim testified that her statements in the forensic interview were true. During the interview, she described multiple occasions of abuse by the Defendant. The interviewer asked the victim a series of open ended questions and did not lead the victim in her responses. The victim described with words and demonstrated with hand motions how the Defendant forced her to engage in inappropriate sexual conduct with him. He forced the victim to touch his genitalia with her hands in an up and down motion until “water” came out and rubbed and patted his genitalia on the victim’s genitalia and buttocks. Viewed in the light most favorable to the State, we conclude that the evidence - 11 - was sufficient for the trial court to find the Defendant guilty of two counts of aggravated sexual battery. Accordingly, the Defendant is not entitled to relief. II. Inconsistent Verdicts. The Defendant also argues that the trier of fact inappropriately “split the verdict” by sustaining only two of his seven convictions, implying a lack of evidence. In response, the State contends that the trial court properly returned a verdict consistent with the proof at trial. The State correctly explains that a “split verdict,” which usually occurs when a jury returns a non-unanimous verdict, did not occur in this case. See, e.g., State v. Mounce, 859 S.W.2d 319, 322 (Tenn. 1993); State v. Richard Lee Gentile, No. 03C01-9506-CR-00171, 1997 WL 21366, at 2 (Tenn. Crim. App. Jan. 21, 1997), perm. app. denied (Tenn. Sept. 15, 1997). Nevertheless, we glean from the context of the Defendant’s argument that he meant “inconsistent verdict” which exists when a defendant is convicted “of one offense and acquit[ed] of another offense even though both counts stem from the same criminal transaction.” State v. Finch, 465 S.W.3d 584 (Tenn. Crim. App. Nov. 22, 2013). In either case, we agree with the State. It is well-established in this State that “consistency between verdicts on separate counts of an indictment is not necessary.” Wiggins v. State, 498 S.W.2d 92, 93 (Tenn. 1973). Appellate courts will not disturb seemingly inconsistent verdicts as doing so would require inappropriate speculation into the trier of fact’s reasoning. Id. Rather, each count in an indictment is treated as a separate indictment, and so long as there is sufficient evidence to support the defendant’s conviction, the verdicts will be upheld. Id. at 93-94. Furthermore, the trier of fact, whether judge or jury, has within its discretion the ability to return a verdict finding the defendant guilty of some counts and not guilty of others pursuant to the evidence adduced at trial. See 7 Tenn. Prac. Pattern Jury Instr.- Crim. 41.03 (“The crime charged in each count of the indictment is a separate and distinct offense. You must decide each charge separately on the evidence and the law applicable to it. The defendant may be found guilty or not guilty of any or all of the offenses charged.”); State v. Davis, 466 S.W.3d 49, 72 (Tenn. 2015) (“Inconsistent verdicts on multiple charges against a single defendant may take the form of an inconsistency between a conviction and an acquittal.”); Finch, 465 S.W.3d at 584 (“[D]isturbing seemingly inconsistent verdicts would have required inappropriate speculation as to the [trier of fact]’s reasoning.”). Accordingly, the only question is whether the evidence is sufficient to support the Defendant’s convictions for aggravated sexual battery. As we have already discussed above, the State presented sufficient evidence to support the Defendant’s convictions of aggravated sexual battery. As such, the Defendant is not entitled to relief on this issue. CONCLUSION - 12 - Upon our review, we conclude that the evidence is sufficient to support the Defendant’s aggravated sexual battery convictions. The judgments of the trial court are affirmed. ____________________________________ CAMILLE R. MCMULLEN, JUDGE - 13 -	{ "pile_set_name": "FreeLaw" }
473 S.E.2d 563 (1996) 221 Ga. App. 889 POOR v. LEADER FEDERAL BANK FOR SAVINGS. No. A96A0794. Court of Appeals of Georgia. June 26, 1996. 564 Macklyn A. Smith, Lawrenceville, for appellant. Morris, Schneider & Prior, Susanne O. Torres, Atlanta, for appellee. SMITH, Judge. Jody Poor appeals the trial court's grant of a writ of possession to Leader Federal Bank. 1. Poor enumerates as error the trial court's failure to enter findings of fact and conclusions of law. She did not, however, request entry of findings and conclusions below. Consequently, such entry was not required. OCGA § 9-11-52(a). Middlebrooks v. Fleet Finance, 217 Ga.App. 263(2), 456 S.E.2d 627 (1995). Poor relies on an earlier decision in which we remanded a case for entry of findings of fact and conclusions of law because the record did not affirmatively show that findings and conclusions were waived. Fry v. J.I. Kislak Mtg. Corp., 167 Ga.App. 775, 307 S.E.2d 302 (1983). That case, though, was decided under OCGA § 9-11-52(a) before its extensive amendment in 1987. Under the former statute, entry of findings and conclusions was required, unless waived by the parties. See Ga. L.1987, pp. 1057-1058, § 1. Under the amended statute, however, entry of findings and conclusions is mandatory only upon request by a party. Id. We reject Poor's contention that findings of fact and conclusions of law were required under OCGA § 44-7-56, the section providing for appeals in dispossessory proceedings. Under that section, "after the notice of appeal is filed with the clerk of the trial court, the clerk shall immediately notify the trial judge of the notice of appeal and the trial judge may, within 15 days, supplement the record with findings of fact and conclusions of law." (Emphasis supplied.) This section makes entry of findings of fact and conclusions of law permissive, not mandatory. We agree with Poor that the record does not indicate whether the required notice was given by the clerk of court to the trial judge that a notice of appeal had been filed. Assuming that the notice was not sent, however, we find no harm to Poor; the requirement that notice be sent from the clerk to the trial judge does not impose a burden on the trial judge to enter findings and conclusions in the absence of a request by one of the parties. 2. Poor also contends the trial court erroneously granted the writ of possession, maintaining that she did not receive proper notice of the prior foreclosure sale as required by the security deed. We find no 565 merit in this contention. Poor has pointed to no evidence supporting her claim, and we find none in the record. Moreover, her attack on the basis of the improper foreclosure is one on the landlord's title, an attack that is not permissible in a dispossessory proceeding. Bridges v. City of Moultrie, 210 Ga. App. 697, 698(1), 437 S.E.2d 368 (1993); Partin v. Southern Discount Co., 167 Ga.App. 798, 799, 307 S.E.2d 697 (1983). Judgment affirmed. POPE, P.J., and ANDREWS, J., concur.	{ "pile_set_name": "FreeLaw" }
In the United States Court of Appeals For the Seventh Circuit ____________________ No. 17-2334 UNITED STATES OF AMERICA, Plaintiff-Appellant, v. MARIO A. RODRIGUEZ-ESCALERA, Defendant-Appellee. ____________________ Appeal from the United States District Court for the Southern District of Illinois. No. 16-CR-30114-SMY — Staci M. Yandle, Judge. ____________________ ARGUED JANUARY 10, 2018 — DECIDED MARCH 7, 2018 ____________________ Before WOOD, Chief Judge, HAMILTON, Circuit Judge, and BUCKLO, District Judge. * BUCKLO, District Judge. Defendant-appellee Mario Rodri- guez-Escalera (“Rodriguez”) and his fiancée Blanca Moran were arrested and charged with possession with intent to distribute methamphetamine in violation of 21 U.S.C. § 841, * Of the Northern District of Illinois, sitting by designation. 2 No. 17-2334 after police discovered a large amount of methamphetamine and cash in Moran’s vehicle during a traffic stop. Before the district court, Rodriguez and Moran each moved on Fourth Amendment grounds to suppress the evidence obtained in the vehicle search. Concluding that the evidence was de- rived from an unlawfully extended traffic stop, the court granted both motions. On appeal, the government challeng- es the grant of Rodriguez’s motion to suppress. We affirm. I. On October 4, 2016, Illinois State Trooper Kenneth Patter- son observed a car abruptly switch lanes in front of a truck without using a turn signal on Interstate 70 in southern Illi- nois. Patterson decided to pull the car over for the traffic in- fraction. See 625 ILCS §§ 5/11-703(a), 5/11-804. Equipped with a dashboard video camera, Patterson’s vehicle recorded the ensuing traffic stop. Once the car stopped, Patterson approached the passen- ger side of the vehicle to find Rodriguez in the front passen- ger seat and Moran in the driver’s seat. Patterson greeted them and asked Moran to provide her license, registration, and proof of insurance. Moran promptly complied. Her li- cense indicated that she was from Paramount, California, a city in Los Angeles County. After gathering Moran’s docu- mentation, Patterson told Moran why he stopped her and explained that he intended to issue her a written warning for her traffic violation. He asked her to accompany him in his squad car while he ran her information and issued the warn- ing. Moran agreed. Patterson led Moran to the front passenger seat of his squad car then returned to Moran’s vehicle to ask Rodriguez No. 17-2334 3 for his identification. As Rodriguez retrieved his documenta- tion, Patterson inquired where he and Moran were headed. Rodriguez answered Pennsylvania. Then he handed Patter- son his Mexican identification card and his Mexican driver’s license. Patterson kept the identification card and handed back the driver’s license before returning to his squad car. Back in his vehicle, Patterson reviewed Moran’s and Ro- driguez’s documents and began to question Moran about her travel plans. Moran told Patterson that she and Rodri- guez, her fiancé, had come from Los Angeles and were head- ing to New York City to visit the city for the first time while she was on vacation from her job as a tax preparer and in- surance broker. Patterson asked where she and Rodriguez were planning to go in New York. Moran replied that she wanted to see Manhattan, Brooklyn, and the Statue of Liber- ty. When Patterson asked how long the trip would last, Mo- ran told him that she had two weeks off from work. She and Rodriguez did not have lodging booked in New York yet, she told Patterson, but they would look for a hotel when they arrived in the city. About eight minutes into the traffic stop, Patterson dis- covered that Moran’s California driver’s license was sus- pended. He informed Moran, who was apparently surprised by the news, and asked whether Rodriguez had a license so that he could drive instead. Moran said that he had a Mexi- can license, so Patterson returned to Moran’s vehicle to col- lect it from him. Moran remained in the squad car. While Rodriguez retrieved his license, Patterson probed for more information about the couple’s apparently conflicting travel plans. He asked Rodriguez what city in Pennsylvania he and Moran were going to visit. Rodriguez, who evidently had 4 No. 17-2334 limited English skills, indicated that he did not know. Pat- terson then asked how long they were going to be gone; Ro- driguez said one or two days. Finally, Patterson asked if they were visiting friends or family there. Rodriguez said no. After this brief exchange with Rodriguez, Patterson re- turned to his squad car. About eleven minutes had passed since he initiated the traffic stop, and Patterson now had all of the information he needed from Moran and Rodriguez to issue the traffic citations and send them on their way. But Patterson had grown suspicious of the couple’s travel plans and decided to have a narcotics-detection dog sniff Moran’s vehicle. Patterson could see from his in-vehicle computer, however, that his department’s K-9 unit was occupied with another traffic stop. Patterson took nearly twenty-two minutes to issue Mo- ran three routine traffic citations—one ticket for driving with a suspended license, one written warning for failing to sig- nal when changing lanes, and one written warning for im- proper overtaking. Before he started writing the citations, Patterson asked Moran for more details about the couple’s travel itinerary. He inquired whether she and Rodriguez planned to stop anywhere else on their way to New York. Moran said that they did not. Troubled by the apparent con- flict, Patterson then asked if Rodriguez knew that they were going to New York. Moran smiled and explained that she told Rodriguez that they were going to Pennsylvania. When Patterson asked why, Moran said she wanted the visit to New York City to be a surprise. Upon further questioning, she explained that Rodriguez knew that they would be gone for two weeks. She also told Patterson that Rodriguez was No. 17-2334 5 not currently employed but that he would be looking for work in construction once they returned to Los Angeles. Over the next several minutes, Patterson worked at his in-vehicle computer, occasionally chatting more with Moran, as he listened to his police radio waiting for the K-9 unit to become available. Patterson eventually heard on the radio that the traffic stop holding up the K-9 unit had ended in an arrest. Patterson messaged State Trooper John Baudino, the K-9 unit officer, to see if he was available. Not until Baudino confirmed that he was available and on his way did Patter- son begin writing Moran’s ticket for driving with a suspend- ed license. Baudino raced to Patterson’s location, arriving about ten or eleven minutes after Patterson’s request and nearly thirty- three minutes into the traffic stop. As soon as he saw that Baudino’s vehicle was behind him, Patterson handed Moran her traffic ticket and written warnings, along with her li- cense, registration, and proof of insurance. He then instruct- ed Moran to stay in the squad car while the K-9 unit sniffed her vehicle. Patterson walked to Moran’s car and told Rodri- guez to roll up his window. Baudino walked his narcotics-detection dog around Mo- ran’s car twice. The dog did not alert him to the presence of any contraband. Despite the negative dog sniff, Patterson remained unconvinced. He returned to his squad car, where Moran was still detained, and resumed questioning her. He asked her whether there was anything illegal in her vehicle. She said there was not. He explained that he just wanted to make sure that she and Rodriguez were actually going to New York. He inquired about Moran’s luggage and whether anyone had given her any luggage to take along to New 6 No. 17-2334 York. She said she only had her luggage. Patterson’s ques- tioning concluded with the following exchange: Patterson: Okay. You’re free to go and every- thing but I’m just concerned that there might be something illegal inside the car. Usually, most people don’t say, “Hey, let’s go on a trip.” And then, they … it’s a surprise, they go to New York. It’s kind of out of the ordinary I should say. I know that probably doesn’t make any sense to you. Moran: No. Patterson: Does that not make any sense to you? A strange trip? Moran: No. I take my vacations. Patterson: Yeah, but telling someone you are actually going to Pennsylvania and then actu- ally you are going to New York, that’s kind of out of the ordinary as far as a trip goes, itiner- ary wise. Can I search that vehicle and its con- tents … Moran: Sure. Patterson: … to make sure there is nothing ille- gal, is that all right? Moran: (nods yes) Patterson: I’ll just have you stay in the vehicle and I’ll have [Rodriguez] step out. Patterson and Baudino then conducted a search of Mo- ran’s vehicle. In her trunk, they uncovered approximately No. 17-2334 7 7.5 pounds of methamphetamine hidden in two pieces of luggage. In Moran’s purse, they discovered nearly $28,000 in cash. Rodriguez claimed ownership of the drugs, Moran claimed ownership of the money. The officers placed them both under arrest. Moran and Rodriguez were each charged with one count of possession of methamphetamine with intent to distribute. See 21 U.S.C. § 841(a)(1). Both filed pretrial motions to sup- press the drug evidence seized from Moran’s vehicle, claim- ing that Patterson unlawfully detained them beyond the time necessary to complete the traffic stop and that Moran had not freely given her consent to the search. The district court held a two-day evidentiary hearing on Moran’s motion to suppress, and, by agreement of the par- ties, adopted its evidentiary findings in Rodriguez’s case in lieu of an additional evidentiary hearing. At Moran’s sup- pression hearing, Patterson testified about several factors that triggered his suspicion during the traffic stop. He told the district court that when he first approached Moran’s front passenger window after making the stop, he smelled a “very pungent” scent of air fresheners and noticed “several” air vent clip-in air fresheners inside Moran’s vehicle, which he had been trained to associate with narcotics traffickers. Patterson told the court that the couple’s origin city further contributed to his suspicion. Los Angeles, he explained, is known as a major distribution center for narcotics traffick- ing. Patterson testified that he also found it odd that Rodri- guez did not initially look up at him and instead seemed to be distracted by a video game on his phone when Patterson introduced himself. Similarly, he thought Moran seemed nervous when he asked her questions in his squad car. Final- 8 No. 17-2334 ly, Patterson told the court that Moran’s and Rodriguez’s conflicting travel plans spurred his suspicions. He explained that the discrepancies in their responses made him think that they were not making “just an ordinary trip.” He suspected that there was “some kind of ulterior motive [for] why they [we]re traveling … some kind of criminal element going on.” The district court was unconvinced. Weighing Patter- son’s testimony and the video and audio recording of the traffic stop, the district court concluded, first in an oral rul- ing on Moran’s motion, then in two subsequent written or- ders on Moran’s and Rodriguez’s motions, that Patterson did not have the reasonable suspicion necessary to extend the stop. Contrary to Patterson’s description of Moran’s nervous demeanor, the court found that Moran was “rela- tively calm and collected throughout the stop,” even as she was made to sit in Patterson’s vehicle and answer questions for approximately thirty minutes. Likewise, the court found that Rodriguez, despite his initial inattentiveness, responded when Patterson spoke directly to him. The court acknowl- edged that conflicting travel plans could support reasonable suspicion, but determined that the additional information that Moran gave Patterson “objectively diminishe[d] the possible conflict.” The court also concluded that the air fresheners that Patterson observed in Moran’s vehicle were not so excessive as to raise a reasonable suspicion. In the court’s view, the government’s “proffered factors, individu- ally and in combination, [we]re insufficient to support [its] claim that Trooper Patterson had a reasonable suspicion of criminal activity to justify a prolonged traffic stop.” The court declined to credit Patterson’s explanations for his de- lay, and instead determined that he “intentionally prolonged the stop” to give the K-9 unit time to arrive. Because it con- No. 17-2334 9 cluded that Patterson unreasonably extended the traffic stop, the court granted Rodriguez’s motion to suppress the evi- dence obtained from Moran’s vehicle as fruit of an unlawful seizure. The government appeals from this decision, arguing that neither the traffic stop nor the vehicle search violated Rodriguez’s Fourth Amendment rights. II. We employ “a mixed standard of review on motions to suppress, reviewing the district court’s factual determina- tions for clear error and de novo its ultimate determination about whether the police had sufficient grounds to stop or search the individual.” United States v. Wilbourn, 799 F.3d 900, 908 (7th Cir. 2015) (citing Ornelas v. United States, 517 U.S. 690, 699 (1996)). The Fourth Amendment guarantees the right to be free from “unreasonable searches and seizures” by the govern- ment. This protection “extend[s] to brief investigatory stops of persons or vehicles that fall short of traditional arrest.” United States v. Arvizu, 534 U.S. 266, 273 (2002). Thus, when- ever a police officer decides to stop a vehicle, the stop must meet the reasonableness requirements of the Fourth Amendment. Delaware v. Prouse, 440 U.S. 648, 663 (1979). If a search or seizure violates the Fourth Amendment, courts will exclude evidence gained from that violation in judicial proceedings against the person injured. Wilbourn, 799 F.3d at 910; see also Terry v. Ohio, 392 U.S. 1, 29 (1968) (“[E]vidence may not be introduced if it was discovered by means of a seizure and search which were not reasonably related in scope to the justification for their initiation.”). 10 No. 17-2334 The Fourth Amendment’s protections are “personal rights” that “may not be vicariously asserted.” Rakas v. Illi- nois, 439 U.S. 128, 133–34 (1978). To challenge evidence ob- tained in an unlawful search, a person must show that he had a “legitimate expectation of privacy” in the area searched. Id. at 143, 149. Typically, a passenger qua passen- ger lacks a legitimate expectation of privacy in a searched vehicle, unless he can show that he has some possessory in- terest in it. See id. at 148–49; Wilbourn, 799 F.3d at 908. A passenger without standing to challenge a vehicle search may nevertheless challenge the legality of a traffic stop. In Brendlin v. California, 551 U.S. 249 (2007), the Su- preme Court held that because a traffic stop seizes all vehicle occupants, a vehicle passenger has standing to suppress evi- dence derived from an unlawful traffic stop. Id. at 255–59; Wilbourn, 799 F.3d at 908 (a passenger has standing to chal- lenge evidence derived from an illegal stop but not evidence derived from an illegal search after a lawful stop). That in- cludes evidence obtained in a search resulting from an un- lawful stop. See United States v. Sanford, 806 F.3d 954, 959 (7th Cir. 2015). Here, the district court concluded that Rodriguez did not have standing to challenge the search itself because he lacked any property or possessory interests in the vehicle. Rodriguez’s standing to challenge the drug evidence uncov- ered in Moran’s vehicle thus depends on whether the traffic stop was unlawful. To pull a car over for a brief investigatory stop, a police officer must have “at least [an] articulable and reasonable suspicion” that the particular person stopped is breaking the law. Prouse, 440 U.S. at 663. Here, there is no dispute that, after observing Moran abruptly change lanes without signal- No. 17-2334 11 ing, Patterson had a lawful basis for initiating the stop. See 625 ILCS §§ 5/11–703(a), 5/11–804; United States v. Muriel, 418 F.3d 720, 724 (7th Cir. 2005) (officer-observed traffic violation triggers probable cause to stop). But a seizure that is “lawful at its inception” can nonetheless violate the Fourth Amend- ment if it is “prolonged beyond the time reasonably required to complete” the initial mission of the stop. Illinois v. Caballes, 543 U.S. 405, 407 (2005) (citing United States v. Jacobsen, 466 U.S. 109, 124 (1984)). That is what the district court conclud- ed happened here. The Supreme Court considered the reasonable duration of traffic stops in Rodriguez v. United States, 135 S. Ct. 1609 (2015). In that case, a police officer lawfully pulled a vehicle over for a traffic violation, issued a written warning for that violation, then continued to detain the vehicle and its driver while he conducted a dog sniff. Id. at 1613. The Court held that the officer’s prolonged detention of the vehicle, even if it was slight, was unlawful, unless it was supported by a rea- sonable suspicion of criminal activity independently suffi- cient to justify a seizure, an issue the Court left to the lower courts to evaluate on remand. Id. at 1615–17. The authority to detain a vehicle and its occupants for a police-observed traffic violation, the Court reasoned, ends when the “tasks tied to the traffic infraction are—or reasonably should have been—completed.” Id. at 1614. Absent reasonable suspicion, then, law enforcement may not extend a traffic stop with measures like a dog sniff unrelated to the mission of the stop. The government does not dispute that Patterson extend- ed the traffic stop beyond the time necessary to issue the traffic citations but argues that Patterson had reasonable 12 No. 17-2334 suspicion to extend the stop. To meet the reasonable- suspicion requirement, an officer must have “a particular- ized and objective basis” for suspecting the persons detained of breaking the law. Heien v. North Carolina, 135 S. Ct. 530, 536 (2014). Although reasonable suspicion “embodies some- thing less than probable cause,” it requires more than a hunch or inchoate suspicion. Wilbourn, 799 F.3d at 909. Thus, to justify a “particular intrusion [a] police officer must be able to point to specific and articulable facts which, taken together with rational inferences from those facts, reasona- bly warrant th[e] intrusion.” Terry, 392 U.S. at 21. When evaluating reasonable suspicion, courts must con- sider “the totality of the circumstances—the whole picture.” United States v. Cortez, 449 U.S. 411, 417 (1981). A “divide- and-conquer analysis” that examines each factor supporting reasonable suspicion in isolation is not permitted. District of Columbia v. Wesby, 138 S. Ct. 577, 588 (2018). Importantly, however, the totality-of-the-circumstances test does not bar courts from discussing factors separately. See, e.g., Wesby, 138 S. Ct. at 586–88 (discussing each factor supporting probable cause separately before considering the combined effect of those factors). It simply requires that courts consider the rea- sonable inferences that a law enforcement officer could draw from the objective facts in combination. The government contends that the district court misap- plied the totality-of-the-circumstances test. It argues that the court overlooked some of the factors supporting Patterson’s suspicion and improperly evaluated and rejected each of the other factors in isolation. In the government’s view, the fac- tors it identified in the district court—(1) that Moran and Rodriguez appeared nervous; (2) that the couple was travel- No. 17-2334 13 ing from a “major narcotics distribution center,” i.e., Moran’s home of greater Los Angeles; (3) that the two presented con- flicting travel plans; and (4) the presence of multiple air fresheners in the car—viewed together through the lens of Patterson’s personal training and experience, justified Pat- terson’s decision to prolong the detention to conduct a dog sniff. We agree with the district court, however, that taken together, these factors did not establish reasonable suspicion. First, while courts must consider the factors supporting an officer’s suspicion cumulatively, they need not accept all of an officer’s proffered justifications at face value. Reasona- ble suspicion must be supported by objective and articulable facts, and the district court as fact-finder is entitled to weigh the evidence presented at a suppression hearing. “[B]ecause the resolution of a motion to suppress is necessarily fact- specific, we give special deference to the district court that heard the testimony and observed the witnesses at the sup- pression hearing.” United States v. Johnson, 383 F.3d 538, 542 (7th Cir. 2004) (quoting United States v. Sholola, 124 F.3d 803, 811 (7th Cir. 1997)) (internal quotation marks omitted); see also Ornelas, 517 U.S. at 699 (“[A] reviewing court should take care both to review findings of historical fact only for clear error and to give due weight to inferences drawn from those facts by resident judges and local law enforcement of- ficers.”). In this case, the district court reviewed the evidence and found that Moran and Rodriguez did not act suspiciously nervous. We see no clear error in the court’s conclusion. The video of the traffic stop—the most reliable evidence of the detainees’ demeanor—shows a relatively calm Moran an- swering all of Patterson’s questions while detained in Patter- 14 No. 17-2334 son’s vehicle for nearly thirty minutes. And the audio foot- age of Rodriguez’s pre-search interactions with Patterson reveals that Rodriguez answered all questions directly posed to him and complied with all of Patterson’s requests, even if he initially did not make eye contact. Cf. United States v. Brown, 188 F.3d 860, 863 (7th Cir. 1999) (weighing a driver’s “very nervous” appearance and his failure to make eye con- tact during a traffic stop for speeding, along with the smell of marijuana and FBI surveillance of the car’s involvement in drug sales, as factors supporting reasonable suspicion). While nervousness is certainly a factor that can support rea- sonable suspicion, see Illinois v. Wardlow, 528 U.S. 119, 124 (2000), the court was not required to credit Patterson’s testi- mony that the couple appeared nervous when the court’s own review of the traffic stop footage led it to the opposite conclusion. The district court also gave little weight to several other factors on which Patterson relied. For instance, Patterson told the court that he found it “very significant” that Moran and Rodriguez initially gave different answers when Patter- son asked them where they were going. But as the district court noted, the information Moran subsequently provid- ed—that the trip to New York was a surprise, and that she had told Rodriguez they were going to Pennsylvania— corroborated Rodriguez’s answer, objectively diminishing the possible conflict. While an officer does not need to rule out innocent explanations for conduct that appears suspi- cious at first blush, see Arvizu, 534 U.S. at 277, a court may consider how facts later obtained mitigate or dispel suspi- cion. See Terry, 392 U.S. at 28 (considering whether any of the defendant’s conduct “gave [the arresting officer] sufficient reason to negate [his] hypothesis” that criminal activity was No. 17-2334 15 afoot). Moreover, a couple taking a spontaneous road trip to New York City is hardly implausible or surprising. The fact that one of the travelers was unaware of the ultimate desti- nation may be unusual, but given Moran’s explanation, we do not think the district erred by giving little weight to this detail. The presence of clip-in air fresheners in the vehicle does not change our analysis. 1 The district court recognized that because air fresheners are sometimes used to mask the scent of narcotics, an excessive air freshener presence in a vehicle can, in combination with other indicators of drug trafficking or concealment, justify extending a stop. See, e.g., United States v. Fuse, 391 F.3d 924, 929 (8th Cir. 2004) (presence of air freshener, a prior arrest record, the absence of the car’s owner, and the driver’s unusual explanations for visiting Kansas City, among other reasons, justified an extended stop). A non-excessive presence of air fresheners, however, may show nothing more than a car owner’s preference for the smell of air fresheners or desire to cover up other, lawful odors. See United States v. Guerrero, 374 F.3d 584, 590 (8th Cir. 2004). So while we agree with the government that the pres- 1 The parties agree here that the district court made an error in its written order when it stated that Patterson only testified to observing two air fresheners in the front cab of the vehicle and not an air freshener in the back. Patterson testified to noticing all three during the stop. Nonetheless, in its earlier oral findings, the court considered both the front seat and back seat air fresheners, and determined that the number of air fresheners—the district court said four, but we only see evidence of three—was not “excessive or unusual … to trigger suspicion, even along with the odor.” The discrepancy about how many air fresheners Patter- son observed in the car is slight enough that it does not change the anal- ysis. 16 No. 17-2334 ence of air fresheners should be considered as part of the whole picture, we conclude that the district court did just that and determined that the three or four small sticks clipped into the car’s air vents were not “excessive” to the point of suggesting unlawful activity. That finding is not clearly erroneous. The government next asserts that the district court over- looked the significance of the fact that Moran and Rodriguez were coming from Los Angeles. But the district court’s writ- ten order acknowledged that Patterson considered Los An- geles’s reputation as a “known drug distribution point,” and the court explicitly considered the factor in its oral findings at Moran’s suppression hearing. We do not think the court erred in discounting the probative value of the fact that the couple began their trip in greater Los Angeles, Moran’s home and the country’s second most populous city. See Reid v. Georgia, 448 U.S. 438, 441 (1980) (concluding that circum- stances that “describe[d] a very large category of presuma- bly innocent travelers” did not support reasonable suspi- cion). The government also contends that the district court did not properly consider Patterson’s experience as a police of- ficer in its analysis. The totality-of-the-circumstances test “al- lows officers to draw on their own experience and special- ized training to make inferences from and deductions about the cumulative information available to them that might well elude an untrained person.” Arvizu, 534 U.S. at 273–74 (internal quotation marks omitted). In other words, a court may give more weight to a police officer’s assessment of cer- tain circumstances due to his particular experience with such matters. See, e.g., United States v. Riley, 493 F.3d 803, 809 (7th No. 17-2334 17 Cir. 2007) (crediting an officer’s specific observations of a suspected bank robbery which were drawn from his experi- ence investigating bank robberies). The government argues that the district court failed to consider how Patterson’s ex- perience with highway drug interdiction informed his view of the factors supporting his suspicion. But, again, the dis- trict court did recognize that Patterson’s suspicions were “based on his training and experience.” Moreover, because it considered how the other factors Patterson observed— conflicting travel plans, air fresheners, and perceived nerv- ousness—can, with other facts, support reasonable suspi- cion, the district court did account for the importance that such details can hold for law enforcement. That the court ul- timately determined that the objective facts fell short of rea- sonable suspicion in this case does not mean that it over- looked how Patterson’s experience and training may have caused him to evaluate air fresheners or undeveloped travel plans differently than others. In summary, at the time Patterson requested the dog sniff, he knew that the couple was coming from the Los An- geles area, where at least Moran resided; that Moran had a few air fresheners in her car; that the couple did not have concrete travel arrangements, but that Moran was using her two-week vacation to surprise Rodriguez with a trip to New York; and that Rodriguez did not initially look up at Patter- son when the officer approached the vehicle. At least two of these characteristics—the presence of a few air fresheners and originating from Los Angeles—could describe “a very large category of presumably innocent travelers.” Reid, 448 U.S. at 441. And the other two factors—the initially conflict- ing travel plans and Rodriguez’s initial inattentiveness to Patterson’s presence—became considerably less probative 18 No. 17-2334 by the time Patterson called Baudino to the scene due to Ro- driguez’s subsequent responses to Patterson’s direct ques- tioning and Moran’s explanations of the couple’s travel plans. See Terry, 392 U.S. at 28. No criminal history, tips, or surveillance supported Patterson’s suspicions. Cf. Sanford, 806 F.3d at 956 (history of drug arrests and gang affiliations supported officer’s reasonable suspicion); United States v. Finke, 85 F.3d 1275, 1282 (7th Cir. 1996) (criminal history check revealed two prior drug convictions, which “strongly confirmed [the police officer’s] initial suspicions”); Brown, 188 F.3d at 863 (FBI surveillance of vehicle’s involvement in drug sales supported reasonable suspicion). Considering these factors together, as the district court did, we agree that the objective facts that Patterson observed fell short of giving him a reasonable basis for believing that criminal activity was afoot. It was therefore unreasonable to detain the couple beyond the time needed to complete the traffic stop’s mis- sion just because the only on-duty K-9 unit was tied up with another stop. Rodriguez’s right to be free from unreasonable seizures does not yield to law enforcement’s resource alloca- tion strains. One last wrinkle remains. The government argues that Rodriguez lacks standing under Brendlin even if the pro- longed detention was unlawful because the drug evidence was derived from Moran’s consent to search rather than Ro- driguez’s detention. We do not share this view. Moran’s consent to search—which the district court deemed involun- tary and which the government does not challenge on ap- peal—happened in the course of the prolonged detention. The government asserts that the detention had ceased be- cause Patterson told Moran she was “free to go and every- thing.” But in the same breath he continued to interrogate No. 17-2334 19 her. Neither Moran nor Rodriguez, who was not a party to this post-sniff conversation, could have reasonably believed that the police encounter had terminated at this point. The drug evidence was therefore derived from the unlawful sei- zure, and Rodriguez, as a subject of that seizure, is entitled to have suppressed any evidence which is the fruit of that violation. III. This is without a doubt a close case. But the record re- flects that the district court closely considered the evidence, weighed the credibility of the arresting officer’s testimony, and considered the weight each factor merited to conclude that the totality of the circumstances failed to support the officer’s reasonable suspicion to extend the stop beyond its traffic-related mission. Because we find no clear error in the district court’s factual findings and otherwise agree with its analysis, the decision below is AFFIRMED.	{ "pile_set_name": "FreeLaw" }
54 F.3d 773NOTICE: Fourth Circuit Local Rule 36(c) states that citation of unpublished dispositions is disfavored except for establishing res judicata, estoppel, or the law of the case and requires service of copies of cited unpublished dispositions of the Fourth Circuit. Michael R. FULLER, Plaintiff-Appellant,v.COM. of Va.; Attorney General of the Commonwealth ofVirginia; Ann Simpson Jones; William Tignor; KathrynBurner; Carolyn E. Carlson, State Hearing Officer, Bureauof Customer Services, Social Services; Judge Scott, GeneralDistrict Court, Stafford, Virginia; Ralph Williams,Sheriff; Daniel M. Chichester; Allen Bareford, PublicDefender's Office; Joseph A. Synan; Thomas Moncure, ChiefClerk, Circuit Court; Scott Bates, former Secretary of theCommonwealth, Defendants-Appellees. No. 95-1132. United States Court of Appeals, Fourth Circuit. Submitted: April 20, 1995.Decided: May 19, 1995. Michael R. Fuller, Appellant Pro Se. Before WIDENER, WILKINSON, and WILKINS, Circuit Judges. PER CURIAM: 1 Appellant appeals from the district court's order dismissing his request for information under the Freedom of Information Act, 5 U.S.C.A. Sec. 552 (West 1977 & Supp.1994), as frivolous pursuant to 28 U.S.C. Sec. 1915(d) (1988). We have reviewed the record and the district court's opinion and find no reversible error. Accordingly, we affirm on the reasoning of the district court. Fuller v. Virginia, No. CA-95-32-R (E.D. Va. Jan. 12, 1995). 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	{ "pile_set_name": "FreeLaw" }
United States Court of Appeals FOR THE EIGHTH CIRCUIT ___________ No. 02-3321 No. 02-3516 ___________ Mary Beth Kennedy, * * Plaintiff-Appellant, * * v. * * Appeals from the United States Baxter Healthcare Corporation; * District Court for the District of * Minnesota. Defendant-Appellee, * * [PUBLISHED] Baxter International, Inc.; Baxter * Healthcare SA; Allegiance Healthcare * Corporation; Allegiance Corporation, * * Defendants. * ___________ Submitted: May 16, 2003 Filed: May 21, 2003 ___________ Before LOKEN, Chief Judge, FAGG and MURPHY, Circuit Judges. ___________ PER CURIAM. Mary Beth Kennedy, who worked as a registered nurse from 1986 until 1997, brought this diversity action against Baxter International Corp., a manufacturer of latex gloves, alleging the gloves caused her to develop a life-threatening allergy to the gloves’ proteins. Kennedy asserted claims of design defect and failure to warn. A jury returned a verdict in favor of Baxter. On appeal, Kennedy contends the district court* abused its discretion when it made two evidentiary rulings. Specifically, Kennedy asserts the district court should not have admitted testimony and a document about Federal Drug Administration (FDA) employee statements to glove manufacturers that the FDA did not want allergy warnings on rubber gloves. The district court did not abuse its discretion in admitting this evidence, however, because the informal FDA pronouncements were probative of whether Baxter acted reasonably in designing, labeling, and selling its rubber gloves. Kennedy also contends the district court should have admitted a medical opinion by her expert on the issue of product defect. The district court did not abuse its discretion in excluding the evidence before trial because the expert, who is not a physician or a toxicologist, was unqualified to give an opinion about what makes a rubber glove safe or unsafe for allergy purposes or what level of proteins or allergens are necessary to achieve a safe level for allergy purposes. Because the evidentiary rulings were not a manifest abuse of discretion affecting substantial justice, and an extended discussion of the facts and the controlling legal principles would have no precedential value in this fact-intensive case, we affirm the district court without any further discussion. See 8th Cir. R. 47B. A true copy. Attest: CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT. * The Honorable Donald D. Alsop, United States District Judge for the District of Minnesota. -2-	{ "pile_set_name": "FreeLaw" }
United States Court of Appeals FOR THE EIGHTH CIRCUIT ______________ No. 00-2598 ______________ BRANDT DISTRIBUTING CO., * INC., a Missouri Corporation, * * Appellant, * * v. * Appeal from the United States * District Court for the Eastern FEDERAL INSURANCE * District of Missouri. COMPANY, an Indiana Insurance * Corporation, * [PUBLISHED] * Appellee. * ____________ Submitted: March 16, 2001 Filed: April 25, 2001 ____________ Before HANSEN and HEANEY, Circuit Judges, and FENNER,1 District Judge. FENNER, District Judge. On March 6, 1996, a fire destroyed a two-story office building and adjoining warehouse in St. Louis, Missouri. The tenant of the building, Brandt Distributing Co., Inc. (“Brandt”), a distributor of coin-operated amusement equipment, filed a claim under its commercial insurance policy. The insurer, Federal Insurance Company 1 The Honorable Gary A. Fenner, United States District Judge for the Western District of Missouri, sitting by designation. (“Federal Insurance”), denied the claim because it believed that: (1) Brandt concealed or misrepresented its alleged involvement in causing the fire, and (2) Brandt was involved in intentionally causing the fire, either directly or indirectly. Federal Insurance relied upon the following provisions of the policy: (1) Insured’s Duties in the Event of Loss or Damage You must see to it the following are done in the event of a loss or damage: Cooperate with us in the investigation, settlement or handling of any claim. Authorize us to obtain records or reports necessary for our investigation. As often as may reasonably be required, permit us to inspect the property and examine your books and records. This insurance is void if you or any other insured intentionally conceals or misrepresents any material fact or circumstance related to this insurance at any time. (2) Policy Exclusion This insurance does not apply to loss or damage caused by or resulting from fraudulent, dishonest, or criminal acts or omissions committed alone or in collusion with others, by you, your partners, directors, trustees, and employees, or by anyone authorized to act for you or anyone to whom you have entrusted covered property for any purpose. Brandt filed suit in Missouri state court to enforce the fire insurance policy, and Federal Insurance removed the case to the United States District Court for the Eastern District of Missouri based upon diversity jurisdiction. Brandt asserted claims under several provisions of the policy, including: (1) loss of the premises, (2) cost of conducting an inventory, (3) loss of inventory and stock, (4) loss of personal property, and (5) cost of the demolition and removal of debris. -2- Federal Insurance answered the complaint with the affirmative defenses, regarding each count, stating that: (1) the loss arose out of the intentional acts of Brandt, and (2) Brandt made material misrepresentations and concealed material facts relating to the insurance claim during Federal Insurance’s examinations under oath, thereby voiding coverage under the policy. Federal Insurance included the actions and statements of Brandt’s employees and/or others acting on its behalf as grounds for these defenses. Federal Insurance also filed a counterclaim seeking a declaratory judgment that Brandt’s policy was void as of the date of the fire due to Brandt’s alleged intentional concealment or misrepresentation of facts relating to the insurance. After trial, the jury returned a verdict in favor of Federal Insurance. Thereafter, Brandt’s Motion for New Trial was denied by the District Court, the Honorable E. Richard Webber presiding. We affirm. On appeal, Brandt argues that the district court erred in instructing the jury that the burden of proof for Federal Insurance’s affirmative defenses of arson and misrepresentation was by a greater weight of the evidence, and that the district court erred by failing to strike the testimony of a fire inspector from the St. Louis Fire Department that the fire was a “fraud” fire and “set for fraudulent purposes.” I. Brandt argues first that the district court erred by instructing the jury that the burden of proof for Federal Insurance’s defenses was the “greater weight of the evidence” standard, as opposed to the “clear and convincing” standard Brandt suggested. Brandt contends that Missouri law requires the “clear and convincing evidence” standard for civil cases involving allegations of fraud or other quasi-criminal wrongdoing under Rodriguez v. Suzuki Motor Corp., 936 S.W.2d 104, 110 (Mo. 1996). -3- In Missouri, it is well established that the burden of proof of an insurer is to prove its allegations of arson as a defense to coverage by a preponderance of the evidence. McCreery v. Continental Ins. Co., 788 S.W.2d 307, 310 (Mo. App. 1990). Nonetheless, Brandt argues that Rodriguez changed the law and that the burden should be greater because the interests at stake reflect more than the loss of money, specifically the defendant’s reputation. Brandt argues that the case at bar is the first one to address this issue since Rodriguez. Rodriguez was a product liability case in which the Missouri Supreme Court held that for common law punitive damage claims the evidence must meet the clear and convincing standard of proof. Rodriguez, 936 S.W.2d at 111. In the course of discussing the standard of proof required for an award of punitive damages, the Missouri Supreme Court stated in its opinion that the clear and convincing standard is used in civil cases involving allegations of fraud or some other quasi-criminal wrongdoing by the defendant. The Missouri Supreme Court referenced that the interests at stake in those cases are deemed to be more substantial than mere loss of money and some jurisdictions accordingly reduce the risk to the defendant of having his reputation tarnished erroneously by increasing the plaintiff’s burden of proof. Id. at 110 (citing Addington v. Texas, 441 U.S. 418, 423, 99 S.Ct. 1804, 1808, 60 L.Ed.2d 323, 329 (1979)). Brandt’s effort to gain support for its position by Rodriguez’s reference to Addington is not well founded. In Addington, the United States Supreme Court reviewed an appellate court’s opinion which held that the proper standard of proof in a civil commitment case involving a mentally ill person was “beyond a reasonable doubt.” In addressing whether the standard for civil commitment should be beyond a reasonable doubt, preponderance of the evidence or an “intermediate standard, which usually employs some combination of the words ‘clear,’ ‘cogent,’ ‘unequivocal,’ and ‘convincing,’” the Court held that the “intermediate standard” was applicable for civil commitments. The Court held as follows: -4- We have concluded that the reasonable doubt standard is inappropriate in civil commitment proceedings because, given the uncertainty of psychiatric diagnosis, it may impose a burden the state cannot meet and thereby erect an unreasonable barrier to needed medical treatment. Similarly, we conclude that use of the term “unequivocal” is not constitutionally required, although the states are free to use that standard. To meet due process demands, the standard has to inform the fact finder that the proof must be greater than the preponderance-of-the-evidence standard applicable to other categories of civil cases. Id. at 432-33. By way of dictum, the United States Supreme Court went on to state that: One typical use of the [intermediate] standard is in civil cases involving allegations of fraud or some other quasi-criminal allegations of fraud or some other quasi-criminal wrongdoing by the defendant. The interests at stake in those cases are deemed to be more substantial than mere loss of money and some jurisdictions accordingly reduce the risk to the defendant of having his reputation tarnished erroneously by increasing the plaintiff’s burden of proof. Id. at 424. The United States Supreme Court provided no cases to support this general statement. Rather, the Court cited authority applying the clear and convincing evidence standard in deportation and denaturalization cases. Id. at 424. This dicta in Addington does not support Brandt’s position that Rodriguez changed the burden of proof for an insurer to prove arson in Missouri. In Rodriguez, the Missouri Supreme Court explained that punitive damages “are imposed for the purpose of punishment and deterrence.” Rodriguez, 936 S.W.2d at 110. Thus, punitive damages are like other cases requiring the clear and convincing standard of proof: the remedy is so extraordinary or harsh that it should be applied only sparingly. -5- Missouri courts have given no indication that Rodriguez applies to any claim other than one for punitive damages. The preponderance of evidence instruction in Missouri, MAI 3.01, has not changed after Rodriguez, except with regard to claims of punitive damages. MAI 3.01, Notes on Use. Furthermore, the case at bar was submitted to the jury on three defenses, including failure to cooperate. Since the jury returned a general verdict which does not specify upon which count or counts the jury found in favor of defendant, the jury may have simply found that Brandt failed to cooperate with Federal Insurance. Such a determination was clearly supported by the record. Brandt’s first point is denied. II. Brandt argues next that the district court erred in failing to grant its motion to strike the testimony of Captain Ronald Gronemeyer of the St. Louis Fire Department that the fire was a “fraud fire.” Brandt argues that the district court erred by allowing Captain Gronemeyer’s testimony that the fire was typical of a “fraud fire” and “set for fraudulent purposes” because it was an opinion that was not disclosed as required by Fed. R. Civ. P. 26(a)(2)(B) and was an impermissible conclusion that invaded the province of the jury. Brandt argues that Captain Gronemeyer’s statements were opinions of the fire captain which were not disclosed in his report, said report was factual in nature, and it concluded only that the fire was incendiary in origin. Brandt contends that Fed. R. Civ. P. 37(c)(1) forbids a party from using such an undisclosed opinion at trial. -6- Rule 37(c) provides, in pertinent part, as follows: (1) A party that without substantial justification fails to disclose information required by Rule 26(a) . . . shall not, unless such failure is harmless, be permitted to use as evidence at trial . . . information not so disclosed. As relevant herein, Rule 26(a) requires disclosure of the identity of persons likely to have discoverable information relevant to disputed facts, a copy of all documents relevant to disputed facts in the party’s possession or control and the identity of any person who may be used to present expert testimony. In addition, Rule 26(a)(2)(B) requires an expert report from any retained expert. There was no violation of Rule 37 or Rule 26 in the case at bar. Captain Gronemeyer conducted his investigation and prepared his report in his official capacity with the St. Louis Fire Department. Captain Gronemeyer’s identity was disclosed to Brandt and a copy of his official report provided. He was not retained as an expert by Federal Insurance. Accordingly, nothing further was required of Federal Insurance under the Rules. There was no dispute that the fire in question was an arson fire with three separate points of origin, each in an accounting area of Brandt’s business. Captain Gronemeyer gave no opinion as to who might have started the fire. His testimony reflected that the circumstances weighed against other possible reasons for an arson fire such as a random act of vandalism or an act of revenge. Captain Gronemeyer’s testimony was a logical inference from his report and lack of foundation is not argued. Captain Gronemeyer did not give an opinion as to who was responsible for the fire and his testimony did not usurp the province of the jury. Brandt’s second point is denied. Accordingly, we affirm. -7- A true copy. Attest: CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT. -8-	{ "pile_set_name": "FreeLaw" }
409 F.2d 9 UNITED STATES of America, Appellee,v.Dean Julious WALSH, Appellant. No. 13118. United States Court of Appeals Fourth Circuit. April 15, 1969. Franklin Smith, Elkin, N.C., for appellant. William H. Murdock, U.S. Atty., (H. Marshall Simpson, Asst. U.S. Atty., on brief), for appellee. Before HAYNSWORTH, Chief Judge, and BOREMAN and CRAVEN, Circuit Judges. PER CURIAM: 1 There is abundant evidence in this routine nontax-paid liquor case that the defendant violated the Internal Revenue laws, as charged, by selling large quantities of nontax-paid whiskey to a government undercover agent. There is not the slightest indication in the record of entrapment, and the contention to the contrary is frivolous. 2 Affirmed.	{ "pile_set_name": "FreeLaw" }
673 F.Supp. 267 (1987) NATIONAL UNION FIRE INSURANCE COMPANY OF PITTSBURGH, PA., Plaintiff, v. CONTINENTAL ILLINOIS CORPORATION, et al., Defendants. HARBOR INSURANCE COMPANY and Allstate Insurance Company, Plaintiffs, v. CONTINENTAL ILLINOIS CORPORATION, et al., Defendants. Nos. 85 C 7080, 85 C 7081. United States District Court, N.D. Illinois, E.D. October 30, 1987. 268 James G. Hiering, Dennis C. Waldon, Jeffrey I. Berkowitz, A. Benjamin Goldgar, Keck, Mahin & Cate, Chicago, Ill., for plaintiff. Lowell E. Sachnoff, Candace J. Fabri, Carolyn H. Rosenberg Safer, Charles J. Ryan, Duane F. Sigelko, Sachnoff, Weaver & Rubinstein, Ltd., Chicago, Ill., for defendants. MEMORANDUM OPINION AND ORDER SHADUR, District Judge. Allstate Insurance Company ("Allstate") and National Union Fire Insurance Company of Pittsburgh, Pa. ("National Union") (collectively "Insurers")[1] have sued Continental Illinois Corporation ("CIC"), its subsidiary Continental Illinois National Bank and Trust Company of Chicago ("Bank")[2] and a host of other defendants, seeking to avoid liability under the directors' and officers' 269 ("D & O") liability policies (the "Policies") Insurers had issued to CIC.[3] Insurers now move for judgment on the pleadings under Fed.R.Civ.P. ("Rule") 12(c) on Count II of the Federal Deposit Insurance Corporation ("FDIC") Counterclaim (the "Counterclaim"). For the reasons stated in this memorandum opinion and order, Insurers' motion is granted. Standard for Decision Rule 12(c) motions, like those for summary judgment, are designed to achieve a resolution of claims on their merits. Unlike a summary judgment motion, however, the Rule 12(c) motion limits the court to the pleadings themselves and to matters subject to judicial notice (5 Wright & Miller, Federal Practice and Procedure: Civil § 1367, at 685 (1969)). Of course the pleadings include the documents attached to the Counterclaim as well as the allegations in the Counterclaim itself.[4] Because FDIC is the nonmovant, all well-pleaded allegations in the Counterclaim must be accepted as true, with all reasonable inferences drawn in FDIC's favor (Republic Steel Corp. v. Pennsylvania Engineering Corp., 785 F.2d 174, 177 n. 2 (7th Cir.1986)).[5] Evidentiary submissions are unnecessary (or more accurately inappropriate), for the question is which party is entitled to judgment as a matter of law on the assumption that all FDIC's well-pleaded factual allegations are true. This time that question must be answered in Insurers' favor. FDIC's Counterclaim[6] This Court's Eleventh Opinion, 113 F.R. D. 527 (1986) granted FDIC permission to file its after-acquired counterclaim under Rule 13(e). FDIC sues as assignee of Continental's former officers and directors, who had been defendants in the underlying securities litigation, Consolidated Litigation, Master File No. 82 C 4712 (N.D.Ill.) (see the Twenty-Third Opinion, 666 F.Supp. at 1184-85). FDIC seeks to enforce its assignors' rights to D & O coverage under the Policies. As earlier opinions in these cases have reflected, the April 3, 1986 agreement under which FDIC acquired its rights (the "Option Agreement") was somewhat off the beaten path. In accordance with one of its provisions, a proposed $68 million settlement was initially tendered to Insurers with a demand that they fund that amount (¶¶ 20-21). When Insurers did not accept the settlement within 60 days (¶ 22), FDIC and the individual defendants executed an alternative agreement as called for in the Option Agreement, settling the litigation for $88 million. Under that agreement the individual defendants assigned to FDIC their right to seek indemnification for the larger settlement amount under the Policies (¶ 23). Under the Counterclaim, FDIC sues for the $88 million in alternative ways: 1. as a claim within the Policies' limits (Count I) or 2. as a claim in excess of the Policies' limits, based on Insurers' breach of their duty to settle (Count II). 270 Insurers' current challenge is to the second of those alternativesthey say any such excess claim (a) has been preempted by Illinois Insurance Code § 155, Ill.Rev.Stat. ch. 73, ¶ 767 ("Section 155") or (b) must lose because FDIC has not obtained a judgment against the individual defendants in excess of the Policies' limits. Although the first argument fails, the second is well founded. Preemption Illinois has long recognized an insured's right to hold the insurer responsible for an amount in excess of the policy limits when the insurer has been guilty of fraud, bad faith or negligence in refusing to settle the underlying claim against the insured within those limits (see, e.g., Olympia Fields Country Club v. Bankers Indemnity Insurance Co., 325 Ill.App. 649, 60 N.E.2d 896 (1st Dist. 1945)). Because an insurer generally does not have an absolute duty to settle a claim against its insured, cases such as Scroggins v. Allstate Insurance Co., 74 Ill.App.3d 1027, 1029, 30 Ill.Dec. 682, 684, 393 N.E.2d 718, 720 (1st Dist. 1979) teach: Accordingly, in Illinois there is imposed upon the insurer a duty, part of the implied-in-law duty of good faith and fair dealing arising out of the insurance relation, to give to the insured's interests consideration at least equal to that of its own in such a case. When an insurer breaches that duty by refusing to settle (id.): it may be liable for the full amount of a judgment obtained against its insured, irrespective of its policy limits. Despite the long and unbroken line of precedents to that effect, affirmed at least as recently as 1983 (Phelan v. State Farm Mutual Automobile Insurance Co., 114 Ill.App.3d 96, 104, 69 Ill.Dec. 861, 866-67, 448 N.E.2d 579, 584-85 (1st Dist.1983)), Insurers insist such a remedy has been preempted by Section 155, which first took effect in 1975 (see Combs v. Insurance Co. of Illinois, 146 Ill.App.3d 957, 961-62, 100 Ill.Dec. 525, 529, 497 N.E.2d 503, 507 (1st Dist.1986)). Indeed, Insurers say this Court so held in the Fourteenth Opinion (652 F.Supp. 858, 866 (1986)). This is not the first time one of the litigants in these actions has tried to tell this Court what it decided in an earlier opinion here (see the Eighteenth Opinion, 658 F.Supp. 781, 788 (1987)). There is of course nothing systemically improper in such an effort,[7] but Insurers' attempt here falls just as flat as did defendants' earlier try. In the Fourteenth Opinion, 652 F.Supp. at 860 this Court did hold that the individual defendants' common-law claims for breach of Insurers' implied duty of good faith and fair dealing were preempted by Section 155. All but one of those claims were based on Insurers' conduct in encouraging allegedly with fraudulent intent the individual defendants to continue litigating the underlying claims. Defendant Edwin Hlavka ("Hlavka") also asserted a claim "based on Insurers' allegedly unreasonable refusal to settle" (id. at 866). That claim was also held preempted by Section 155. In fairness to Insurers, that last language can be read as saying what Insurers now say it does. As FDIC points out, however, an insured's claim "based on an unreasonable refusal to settle" can encompass claims for two distinct types of misconduct by the insurer: 1. an improper refusal to settle a claim asserted against its insured or 2. an improper refusal to "settle" a claim by its insured under its policy. It was only the latter type of claim that the Fourteenth Opinion considered and found preempted by Section 155. Although Hlavka's counterclaim was apparently asserting both types of claims, he clearly had 271 previously assigned to FDIC any claim for excess coverage because of any bad faith by Insurers. Insurers never argued, and this Court did not consider, whether or not an excess coverage claim (whether by Hlavka or by FDIC) because of an insurer's bad faith refusal to settle was preempted by Section 155. This opinion now proceeds to examine such an argument. Section 155 both permits and limits certain amounts to be taxed against an insurer as extraordinary "costs": for an unreasonable delay in settling a claim [if it also] appears to the court that such action or delay is vexatious and unreasonable. Insurers' preemption argument is essentially a syllogism: 1. Section 155 preempts all common law actions for breach of an implied covenant of good faith and fair dealing (Trautman v. Knights of Columbus, 121 Ill.App.3d 911, 915, 77 Ill.Dec. 294, 460 N.E.2d 350, 353 (1st Dist.1984)), including breaches based on a refusal to "settle" (Zakarian v. Prudential Insurance Co. of America, 652 F.Supp. 1126, 1137 (N.D.Ill.1987)). 2. FDIC is asserting a claim for a bad faith refusal to settlea claim based on Insurers' implied duty of good faith and fair dealing (Scroggins, 74 Ill.App.3d at 1029-30, 30 Ill.Dec. at 684, 393 N.E.2d at 720). 3. Therefore FDIC's claim is preempted by Section 155. Insurers' syllogism fails because it ignores the lesson from Combs, 146 Ill. App.3d at 963-64, 100 Ill.Dec. at 530, 497 N.E.2d at 508, applied in Zakarian, 652 F.Supp. at 1136-37: Combs teaches it is not the legal theory [claimant] asserts ... that determines Section 155's preemptive effect. Instead this Court must look beyond such legal theories to the predicate acts or conduct forming the basis for that claim. If the alleged conduct is within the scope of Section 155, then the claim is preempted. Here the conduct at issue does not fall within the scope of Section 155. To be sure, the statute does provide a remedy for unreasonable delays in "settling a claim" language with the already-discussed potential double meaning. But that language, as used in Section 155, refers only to delays in paying a claim by the insured under the insurance policy. Unreasonable refusals to settle a claim against the insured must be viewed as a type of conduct not covered by Section 155. Even a brief analysis demonstrates why that is so. By its terms Section 155 covers delay-oriented claims. Though such delays may arguably cause consequential as well as direct damages, the General Assembly has made a policy decision that balances competing interests: 1. Instead of encouraging inquiry into such collateral damage claims (with their obvious Hadley v. Baxendale problems), Section 155(1) sets defined bounds for the add-on recovery (with a ceiling of $25,000 under Section 155(1)(b)). 2. To avoid the erosion of the insurance proceeds by the cost of recovering them, Section 155(1) forces the insurer to bear the insured's litigation expenses. Of course an outright refusal to make a payment is the ultimate in "delay" (Zakarian, 652 F.Supp. at 1137). But when that refusal frustrates a third party's willingness to settle a claim against the insured within the policy limits, the damage to the insured is truly direct rather than consequential it is clearly measurable (in terms of the third party's excess recovery over the policy limits) and poses no arcane proximate cause issues (under Hadley v. Baxendale or otherwise). None of the myriad Illinois cases allowing claims against insurers in excess of policy limits has even hinted that Section 155 is implicated in the analysis, and this Court is not about to hold otherwise. This analysis is buttressed by a look at the language and structure of Section 155 itself. By its terms it applies (Section 155(1), emphasis added): In any action by or against a company wherein there is in issue the liability of a company on a policy or policies of insurance or the amount of the loss payable 272 thereunder, or for an unreasonable delay in settling a claim.... In like manner Section 155(2) speaks of the possibility of "several policies insuring the same insured against the same loss ..." (emphasis again added). Those references to "loss payable thereunder" and "policies insuring ... against ... loss" fit the kinds of policies in which the insurer has withheld an amount due to the insured: proceeds of life insurance, fire insurance, business interruption insurance and the like. That language equally plainly does not apply to the situation in which the claimed misconduct by the insurer is its refusal to pay less than the policy coverage on a third party's claim against the insuredthus exposing the insured to far greater liability. True enough, the first phrase in Section 155(1) speaks of "liability of a company on a policy or policies." But the sensible reading of that language as part of the whole statute, and not in isolation, also comports with the analysis in this opinion, rather than with the position asserted by Insurers. Such a reading of Section 155 is reinforced (rather than undercut, as Insurers argue) by the absence of any case rejecting, on preemption grounds, such excess-coverage claims for bad faith refusals to settle. Not only is that excess-coverage bad-faith-refusal cause of action well-established, but it has been repeatedly reconfirmed after Section 155 came into the statute books. Possible preemption of such claims has not even been discussed in any of the post-1975 cases. Judicial silence on that score is wholly understandable, not only in light of the language of Section 155 but also because that section's remedies would not even come close to providing an insured with protection from the type of bad faith conduct by an insurer at issue here. Those statutory remedies arguably give an insured adequate compensation for any damages caused by unreasonable delays in paying a claim by the insured, but they would offer cold comfort to an insured exposed to liability far in excess of a policy because of its insurer's bad faith refusal to settle. In Insurers' version of the universe, they can be totally arbitrary in exposing their insureds to unlimited liability, secure in the knowledge that Insurers themselves are at risk for no more than $25,000 of that amount. That is a distorted reading of both Section 155 and its purposes, and Insurers have to know it. Judgment v. Settlement Insurers also argue FDIC cannot state a cause of action against them for liability in excess of their Policies' limits unless there has been a judgment rendered against the insureds in excess of the Policies. Here of course there has been no such judgment, because FDIC and the individuals settled rather than litigating to judgment. Insurers point to the literal language in such cases as Scroggins, 74 Ill.App.3d at 1030, 30 Ill.Dec. at 684, 393 N.E.2d at 720: The fact of the entry of the excess judgment against the insured itself constitutes the damage that permits the insured to recover for breach of the duty owed. That language is echoed in other authorities (see, e.g., 7C Appleman, Insurance Law and Practice § 4712, at 431 (1979)): The cause of action [for excess liability] arises when the insured is required to pay a judgment that is in excess of his policy limits. Neither litigant has identified any Illinois case that has ruled either way on whether an adverse judgment is a precondition to suit. FDIC insists it can enforce the settlement in excess of the Policies' limits because Insurers acted negligently or in bad faith when they refused FDIC's earlier lower offer. FDIC cites several cases from other jurisdictions recognizing such a right. Additionally it argues Illinois law would give an insured the same right to settle and enforce a settlement against its insurer after a breach of the duty to settle as it does after a breach of the duty to defend (the latter cause of action is recognized by the Illinois cases). To address those arguments adequately, it is necessary to look at the policies and the reasoning underlying the cause of action at issue here. 273 When an insured faces a claim in excess of its[8] insurance coverage, the insured and insurer often have conflicting interests (legitimate on each side) as to litigation and settlement strategy. Each wants to avoid its liability entirelyor alternatively the insurer would like to minimize its own liability if it cannot escape altogether. That means any offer to settle within the policy limits will be acceptable to an insured, while insurers can and often do decide to gamble and face exposure greater than the settlement offer because of the chance to avoid liability altogether (or minimize it further) at trial. Unfortunately for the insured, who is also put at risk by such a gamble, insurers usually control whether to accept a settlement offer. When an insured pays an insurance premium, part of the bargained-for protection is the insurer's payment of settlements (not just its payment of judgments after trial). Illinois courts therefore impose an obligation on every insurer to give an insured's interests at least equal weight when considering whether to accept settlement offers (Scroggins, 74 Ill.App.3d at 1029, 30 Ill.Dec. at 684, 393 N.E.2d at 720). Insurers' refusals to settle usually force insureds to go to trial, thus risking judgments in excess of the insurance coverage and hence risking personal liability. If the insurer's settlement refusal decision is made negligently or in bad faith, Illinois courts properly impose liability on the insurer for any harm caused the insured (the amount by which the judgment exceeds the policy). In that way the insurer may still gamble, but the adverse consequences of every careless or bad faith gamble are thrust on the insurer and not the insured. FDIC contends the individual defendants had the right to settle the claims against them on their own after Insurers allegedly breached their own duty to settle those claims. FDIC further claims the right to collect that settlement amount from the Insurers, even though in excess of the Policies' limits, so long as the settlement is reasonable and was reached in good faith. Insurers do not challenge the former proposition (at least for now), but they hotly contest the latter. Illinois law allows an insured to effect a reasonable settlement on its own after the insurer has breached the duty to settle (Krutsinger v. Illinois Casualty Co., 10 Ill.2d 518, 527, 141 N.E.2d 16, 21 (1957)), just as after the insurer has breached the duty to defend (Thornton v. Paul, 74 Ill.2d 132, 144-45, 384 N.E.2d 335, 340 (1979)). FDIC seeks to equate those two kinds of breaches, so that the only limitations on collecting the settlement amount from the insurer in either situation are the insured's good faith and the settlement's reasonableness. When an insurer totally abandons its insured by breaching the duty to defend, such abandonment waives most of the insurer's rights under its policy, including any right to approve a settlement. But the insurer is not rendered absolutely liable for all claims against the insured. Even if the insured then suffers a judgment in excess of the policy, it cannot collect that full amount from its insurer absent a showing that the insurer's breach also cost the insured an opportunity to settle below the policy limits (see United States Fidelity & Guaranty Co. v. Copfer, 48 N.Y.2d 871, 424 N.Y.S.2d 356, 400 N.E.2d 298 (1979); cf. Kinnan v. Charles B. Hurst Co., 317 Ill. 251, 148 N.E. 12 (1925)). Such proof is insisted upon to meet the causation requirement: that the insurer's breach of its duty to defend was the but-for source of the insured's liability beyond policy limits (see State Farm Mutual Auto Insurance v. Paynter, 122 Ariz. 198, 204-05, 593 P.2d 948, 954-55 (App.1979), citing and quoting from Mannheimer Bros. v. Kansas Casualty & Surety Co., 149 Minn. 482, 184 N.W. 189 (1921)). If a settlement was available within the policy limits and the insurer's breach of the duty to defend frustrated that settlement, there would appear to be no principled distinction between a later excess judgment for the insured and a later excess settlement made by the insured reasonably and in good faith. In 274 each instance the breach would have triggered the excess liability. When an insurer breaches only its duty to settle, it may be argued the insured should not be allowed to settle on its own because the insurer still has legitimate interests in preventing or mitigating its liability by forcing a trial (see Fireman's Fund Insurance Co. v. Security Insurance Co. of Hartford, 72 N.J. 63, 367 A.2d 864, 873-77 (1976) (Clifford, J., dissenting)). As FDIC points out, however, claims in excess of policy limits force an insured to gamble with its own money. And so long as the insured cannot look to the insurer for that excess amount without proving the insurer's negligence or bad faith, the insured has ample incentive to be reasonable in negotiating settlements itselffor it will be out of pocket if it cannot sustain its burden of proof. In any event, all the courts that have considered the question have allowed insureds (1) to effect reasonable settlements on their own after their insurers have breached their duty to settle and (2) to enforce those settlements against the insurers if reasonable and made in good faith (see, e.g., Krutsinger, 10 Ill.2d at 527, 141 N.E.2d at 21; Mendota Electric Co. v. New York Indemnity Co., 211 N.W. 317, 318 (Minn.1926)). Ordinarily that enforcement involves only an amount up to the policy limit (Fireman's Fund, 367 A.2d at 870; Evans v. Continental Casualty Co., 40 Wash.2d 614, 245 P.2d 470, 479 (1952); see also 14 Couch on Insurance 2d § 51:30, at 430 (rev. ed. 1982)). However, FDIC identifies three cases imposing full liability on insurers for settlements in excess of the policy coverage: Town of Poland v. Transamerica Insurance Co., 53 A.D.2d 140, 385 N.Y.S.2d 987 (1976), Potomac Insurance Co. v. Wilkins Co., 376 F.2d 425 (10th Cir.1967) andalso fully supporting FDIC's positionNational Union Fire Insurance Co. of Pittsburgh, Pa. v. Seafirst Corp., No. C85-396R (W.D.Wash. Mar. 25, 1987). In addition to being the most recent case to consider the issue, Seafirst is closest to this one in factual terms (that is, if FDIC's allegations here are accepted as gospel). There the insured was allowed to enforce an independent settlement in excess of policy limits against National Union because of National Union's earlier bad faith refusal to settle within policy limits. Judge Rothstein saw no reason to treat a settlement any differently than a judgment in excess of the policy limits, so long as that settlement was reasonable and reached in good faith. Because she was required to look to Washington law in her diversity case, she had to reconcile her analysis with that of the Washington Supreme Court in Evans.[9] Although Evans, 245 P.2d at 479 had suggested such settlements could be enforced only up to the policy limit, Judge Rothstein found the state court had not been faced with the question of a settlement in excess of policy limits. Accordingly she felt free to rule as she did. So long as the insured retainsas it mustthe burden of proving causation as well as the reasonableness and the bona fides of the excess settlement, this Court concurs with Judge Rothstein. Again, so long as the insurer's breach of its duty to settle is shown to have deprived the insured of the opportunity for a favorable settlement, no rational distinction separates the insured's striking the next best deal it can make from the insured's going to trial and getting hit with a larger judgment. Either way the insured has been compelled to accept liability because of the insurer's negligence or bad faith in rejecting the more favorable settlement. Actual Harm FDIC's victory on the issue just discussed forces its defeat on an equally critical issuea classic instance of winning the battle but losing the war. At several points in the preceding analysis this opinion has stressed the need for the insured to be at risk for the settlement amount in excess of the policy limits before it can seek to thrust that risk onto its insurer. That after all is the factor that builds into the 275 equation the elements of the settlement's reasonableness and the insured's bona fidesthat at-risk requirement provides the equivalent of an adversary litigation that produces a judgment in excess of the policy limits.[10] If the insured is speculating only with the insurer's dollarsa sort of "Heads I win, tails I lose nothing" there is no rational limit imposed on the putative settlement. It is hardly surprising that Illinois requires the insured to face at least the threat of personal liability in excess of the policy before it or its assignee can collect such an amount from its insurer (see Steele v. Hartford Fire Insurance Co., 788 F.2d 441, 449-50 (7th Cir.1986)). Although the insured need not show its actual ability to pay the full judgment (Wolfberg v. Prudence Mutual Casualty Co. of Chicago, 98 Ill.App.2d 190, 196-97, 240 N.E.2d 176, 179-80 (1st Dist.1968)), it must be personally liable for the excess amount (Childress v. State Farm Mutual Automobile Insurance Co., 97 Ill.App.2d 112, 119-20, 239 N.E.2d 492, 496-97 (4th Dist.1968); accord, Smiley v. Manchester Insurance & Indemnity Co. of St. Louis, 13 Ill.App.3d 809, 814, 301 N.E.2d 19, 22 (2d Dist.1973)). FDIC's settlement with the individual defendants does not expose them to such personal liability. It calls for FDIC to collect the $88 million only from Insurers. True enough, if FDIC is unable to do that for specified reasons, FDIC can then go after the individual defendants. But in that event the individuals' liability (if any) would be determined only after further arbitration or litigation. In the sense called for by the cases, the individual defendants are not in any way personally liable for the $88 million amount of the settlement. That being so, they have not been demonstrably harmed, as to the uninsured portion of the settlement figure, by Insurers' breach of their duty to settle. In turn FDIC, as assignee, cannot enforce that settlement against Insurers in excess of their Policies' limits (see Childress, 97 Ill.App.2d at 119-20, 239 N.E.2d at 496-97).[11] Conclusion FDIC's efforts to saddle Insurers with liability in excess of the Policies' limitsa liability predicated on Insurers' claimed unreasonableness or bad faith in turning down a lesser settlement figuresurmounts several of the roadblocks Insurers have sought to erect. But FDIC ultimately falls for lack of the necessary showing of causation. Count II of FDIC's Counterclaim is dismissed. NOTES [1] Counsel for defendants and for Harbor Insurance Company ("Harbor") (the insurance carrier providing the primary coverage) have represented orally at several status hearings that they have agreed to a settlement of Harbor's claims and of defendants' counterclaims against Harbor. Though the settlement is conditioned on certain approvals, counsel suggested current motions be dealt with as though Harbor were not an active litigant. This opinion, like other recent opinions in these actions, follows that suggestion. [2] CIC and Bank are collectively called "Continental." [3] Because this Court has typically begun all its opinions in these cases with the same opening description, some means of early differentiation is useful. Solely for that purpose, it is noted this is this Court's twenty-seventh written opinion since the cases were assigned to its calendar after a series of recusals by other judges of this District Court. For the same ease in reference, earlier opinions will also be cited by number. [4] In like manner, the Twenty-Third Opinion, 666 F.Supp. 1180, 1186-88 (1987) considered Insurers' Policies (which are attached to their Amended Complaint) as part of the relevant pleadings for purposes of defendants' Rule 12(c) motion on several of Insurers' claims. [5] As with almost every general rule, there are of course caveats. Hargis Canneries, Inc. v. United States, 60 F.Supp. 729, 729 (W.D.Ark.1945) (citations omitted) explains: The motion for judgment on the pleadings admits all facts well pleaded, but does not admit conclusions of law; facts which the court will take judicial notice are not true; legally impossible facts; facts which would be inadmissible in evidence in the event of a trial nor facts which might appear by a record or document included in the pleadings to be unfounded. [6] Specific references to the Counterclaim's allegations will take the form "¶." [7] Courts are always interpreting (or reinterpreting) what other courts have decidedthat is the essence of what passes for legal reasoning (see Levi, Introduction to Legal Reasoning) and is at the core of how legal concepts shift and grow while adhering to stare decisis principles (id.). In fact, even for purposes of issue preclusion (collateral estoppel) it is for the later court, not the original source of a decision, to decide what the first court decided. [8] For simplicity the neutral pronoun "it" will be used to refer to an insured as well as an insurer. [9] This Court faces no such problem, for Illinois case law really casts no light on the question. [10] In case of settlement, the need for the insured to prove its own good faith and the settlement's reasonableness provides the equivalent of the arms-length nature of an adverse judgment after trial. [11] This result makes it unnecessary to deal now with the question whether the $88 million settlement would meet the tests of reasonableness and bona fides.	{ "pile_set_name": "FreeLaw" }
178 F.2d 648 SOUTH SIDE THEATRES, Inc., et al.v.UNITED WEST COAST THEATRES CORPORATION et al.12165 United States Court of AppealsNinth Circuit. Dec. 22, 1949.Rehearing Denied Feb. 1, 1950. 1 Macfarlane, Schaefer & Haun, Henry Schaefer, Jr., William P. Gamble, James H. Arthur, Los Angeles, Cal. (Russell Hardy, Los Angeles, Cal., of counsel), for appellants. 2 Gurney E. Newling, Clyde E. Holley, George W. Tackabury, Frank R. Johnston, Newling, Holley, Sandmeyer & Tackabury, Los Angeles, Cal., for appellees. 3 Before BONE, Circuit Judge, and LING and DRIVER, District Judges. 4 DRIVER, District Judge. 5 Defendants' appeal from an order approving a receiver's final account raises the single issue whether the district court had jurisdiction of the action in which the receiver was appointed. In their complaint the plaintiffs, United West Coast Theatres Corporation and Fox West Coast Agency Corporation, asked for declaratory relief under Section 2201 of Title 28 U.S.C.A., and for the appointment of a receiver to operate defendants' theatre property involved in the controversy. The receiver was appointed, operated the property for approximately seventeen months and filed his final account. In the meantime the defendants moved to dismiss the complaint, one ground being that the court lacked jurisdiction, but so far as the record on this appeal shows, the trial court did not rule on the motion and no other steps were taken to advance the main action. Defendants (appellants) contend that the complaint does not state facts sufficient to give a federal court jurisdiction and that the receivership proceedings, therefore, are void from beginning to end. If the contention is sound, it follows that the costs and expenses of the receivership and the fees of the receiver and his attorney should not be paid from receivership funds.1 6 Diversity of citizenship is not claimed and the question for determination is whether the action is one arising under the laws of the United States.2 An action so arises where an appropriate statement by the plaintiff, unaided by an anticipation or avoidance of defenses, shows that it actually and substantially involves a controversy respecting the validity, construction, or effect of an act of Congress upon the determination of which the result depends.3 The statement of the facts upon which the existence of federal jurisdiction depends must affirmatively and distinctly appear in the plaintiff's complaint.4 In order to determine whether the district court had jurisdiction in the present case, then, we must look to the allegations of the complaint. 7 The first paragraph consists of the usual recitals, by way of legal conclusions, of the basis of jurisdiction. The paragraph reads as follows: 'The matter in controversy exceeds, exclusive of interest and costs, the sum or value of three thousand dollars ($3,000.00) and arises under the laws of the United States, to wit: Section 1(4) of the Act of Congress of July 2, 1890, 15 U.S.C.A. § 4, entitled 'An act to protect trade and commerce against unlawful restraints and monopolies,' commonly known as the Sherman Act.' 8 The factual allegations of the complaint which follow paragraph one may be summarized as follows: 9 On April 1, 1941, plaintiff United West Coast Theatres Corporation, the lessee of the Fifth Avenue Theatre in Inglewood California, plaintiff Fox West Coast Agency Corporation and defendant South Side Theatres, Inc., the owner of the Alto Theatre in Los Angeles, entered into a written agreement for the joint operation of the theatres and the buildings in which they were situated for the term of ten years. The agreement provided that plaintiff United West Coast Theatres Corporation and defendant South Side Theatres, Inc. were to share the profits and losses of the joint venture, in the proportion of 51 per cent to the former and 49 per cent to the latter. Plaintiff Fox West Coast Agency Corporation was to supervise the business of the venture and as compensation therefor was to receive 5 1/4 per cent of the gross weekly receipts. 10 On the date of the making of the joint venture agreement, the parties thereto entered into a written contract which provided for the termination of the venture at the election of any party thereto upon the happening of certain events. Among the specified events was the entry of a decree in an action brought by the United States against any party to the joint venture agreement requiring such party to terminate or nullify the agreement or the effect of which would be to subject any party thereto to penalty or damage on account thereof or anything done thereunder. 11 On March 1, 1944 defendant South Side Theatres, Inc. transferred all of its interest in the joint venture (reserving ownership of its theatre building) to the other defendants, South Side Associates. 12 On June 11, 1946, a Special Expediting Court, sitting as the United States District Court for the Southern District of New York, in the case of United States v. Paramount Pictures, Inc. et al., 66 F.Supp. 323, 351, filed an opinion in which the court expressed the view that certain agreements between owners of two or more theatres normally in competition were illegal and that 'even if the parties to such combinations were not major film producers and distributors, but were all wholly independent exhibitors, such agreements might often be regarded as beyond the reasonable limits of restraint allowance under the Sherman Act (15 U.S.C.A. § 1 et seq).' On December 31, 1946 the Expediting Court filed its findings of fact, D.C., 70 F.Supp. 53, 67, one of which was as follows: 'Other forms of operating agreements are between major defendants and independent exhibitors rather than between major defendants. The effect is to ally two or more theatres of different ownership into a coalition for the nullification of competition between them and for their more effective competition against theatres not members of the 'pool'.' On the same date the court entered a decree enjoining and restraining certain of the defendants in the New York action, including Twentieth Century-Fox Film Corporation 'from making or continuing to perform pooling agreements whereby given theatres of two or more exhibitors normally in competition are operated as a unit or whereby the business policies of each are collectively determined by a joint committee or by one of the exhibitors, or whereby profits of the 'pooled' theatres are divided among the owners according to prearranged percentages.' The foregoing provisions of the decree became effective July 1, 1947. 13 The plaintiffs (in the instant case) are subsidiaries of Twentieth Century-Fox Film Corporation and National Theatres Corporation and are informed and believe that the joint venture agreement is one the performance of which is enjoined and restrained by the decree above mentioned. Plaintiffs fear that if they continue to operate the Alto Theatre under the joint venture they will violate the terms of the decree, be in contempt of the court making the same and be subjected to penalties therefor. 14 The venture agreement is a written contract in which plaintiffs are interested and with reference to which they desire a declaration with respect to the rights and liabilities of plaintiffs and defendants. 15 On June 10, 1947 plaintiffs served upon defendants a notice of intention to terminate the joint venture agreement by reason of the happening of certain events specified in the termination agreement and because of the provisions of the decree in the case of United States v. Paramount Pictures, Inc. et al., and on June 30, 1947 plaintiffs served upon defendants a notice of termination of the agreement. An actual controversy between the parties exists, as plaintiffs contend that by reason of the provisions of the termination agreement and by reason of the terms of the New York decree plaintiffs are no longer legally permitted to perform the venture agreement and the performance thereof has been rendered impossible and terminated by operation of law, whereas the defendants contend that regardless of the decree the plaintiffs are still bound by the joint venture agreement and required to perform the same in accordance with its terms. 16 On June 30, 1947 plaintiffs tendered the Alto Theatre to the defendants and requested them to operate the same, but defendants refused to accept or comply. The theatre, a profitable enterprise, was closed and would 'remain dark' after June 30, 1947, resulting in irreparable damage unless a receiver was appointed to operate it. 17 In the prayer of their complaint, following the foregoing factual allegations, the plaintiffs asked that the joint venture agreement be declared terminated and of no further force or effect, and that plaintiffs be relieved from liability to perform the same; that the court declare such other rights or duties as might be necessary or proper with relation to the agreement between the parties; and that a receiver be appointed to take charge of and operate the Alto Theatre and the Alto Theatre Building. 18 While it appears from the foregoing summary that the plaintiffs stressed their right to terminate the joint venture agreement pursuant to the provisions of the termination agreement and the proceedings in the anti-trust suit brought by the government in the New York District Court, we think the complaint nevertheless sets forth sufficient facts to raise the issue that the joint venture agreement violated the Sherman Act. It is alleged that plaintiffs and defendants, competitors in the theatre business, entered into a contract for the joint operation of their rival theatres under an arrangement whereby the profits were to be shared but both properties were to be under the direction and control of the plaintiffs, and that other similar pooling arrangements had been held to constitute violations of the Sherman Act. Although not well pleaded, and lacking the emphasis given by the pleader to the termination agreement and the findings and decree of the New York District Court, such factual allegations, we think, sufficiently show a substantial controversy with reference to the validity of the joint venture agreement under the Sherman Act, in the posture of the instant case.5 An action in which the court is asked to declare a contract illegal under the Sherman Act and that the defendants are engaged in unlawful restraint of trade presents a federal question sufficient to give a district court jurisdiction. Rambusch Decorating Co. v. Brotherhood, etc. of America, 2 Cir., 105 F.2d 134, 136; certiorari denied 308 U.S. 587, 60 S.Ct. 110, 84 L.Ed. 492. Cf. Duplex Printing Press Co. v. Deering, 254 U.S. 587, 60 S.Ct. 172, 65 L.Ed. 349, 16 A.L.R. 196. See also General Railroad Co., 271 U.S. 228, 46 S.Ct. 496, 70 L.Ed. 920. It is immaterial that the plaintiffs stated in the complaint another and different ground for declaratory relief which, we will assume, did not present a federal question, namely, that the joint venture contract was cancelled pursuant to the provisions of the termination agreement. Where two separate and distinct grounds are alleged in support of a cause of action or claim, only one of which raises a federal question, the federal court has jurisdiction if the federal question presented is substantial, and even though the federal ground is not established by the evidence the court may retain jurisdiction and dispose of the case on the non-federal ground.6 If we disregard, as we may for our present purpose, all of the allegations pertaining to the termination agreement and the acts of the plaintiffs thereunder, we think that there remains in the complaint a sufficient factual basis to support a controversy as to whether the joint venture agreement contravened the restrictions of the Sherman Act. 19 The order of the district court is affirmed. 1 Finneran v. Burton, 8 Cir., 291 F. 37; Fryer v. Weakley, 8 Cir., 261 F. 509; Noxon Chemical Products Co. v. Leckie, 3 Cir., 39 F.2d 318, 321. See also Gordon v. Washington, 295 U.S. 30, 37, 55, S.Ct. 584, 79 L.Ed. 1282; Kelleam v. Maryland Casualty Co., 312 U.S. 377, 61 S.Ct. 595, 85 L.Ed. 899 2 See 28 U.S.C.A. §§ 1331 and 1337 3 Shulthis v. MacDougal, 225 U.S. 561, 569, 32 S.Ct. 704, 56 L.Ed. 1205; Hopkins v. Walker, 244 U.S. 486, 489, 37 S.Ct. 711, 61 L.Ed. 1270; First Nat. Bank of Canton, Pa., v. Williams, 252 U.S. 504, 512, 40 S.Ct. 64 L.Ed. 690; Barnhart v. Western Maryland Ry. Co., 4 Cir., 128 F.2d 709, 713 4 Norton v. Larney 266 U.S. 511, 515, 45 S.Ct. 145, 69 L.Ed. 413; Smith v. McCullough, 270 U.S. 456, 459, 46 S.Ct. 338, 70 L.Ed. 682 5 Plaintiffs' attorneys so interpreted the complaint in the argument before the trial court on September 12, 1947, on defendants' motion, to dismiss. One of plaintiffs' attorneys then stated: 'Our contention in this court, your Honor, and I hope I can make it clear, is that we are asking you to find that this joint venture agreement under the Sherman Act is illegal. We cite the case (United States v. Paramount Pictures, Inc. (D.C., 66 F.Supp. 323; Id., D.C., 70 F.Supp. 53) in our complaint because it is perfectly proper, the Paramount decree, as authority for holding that this joint venture agreement in this lawsuit is illegal.' Although the trial court in colloquy with counsel expressed the opinion that jurisdiction was lacking, the record shows no disposition of the motion to dismiss. Evidently it was denied or waived, however, as the defendants in a second amended answer set up a counterclaim against plaintiffs and third party defendants for treble damages for violation of the Sherman Act. See the district Court's opinion reported in 86 F.Supp. 109. The court there held that the defendants' counterclaim was not barred by limitation 6 Siler v. Louisville & Nashville R. Co., 213 U.S. 175, 191, 29 S.Ct. 451, 53 L.Ed. 753; Lincoln Gas & Electric Light Co. v. City of Lincoln, 250 U.S. 256, 39 S.Ct. 454, 63 L.Ed. 968; Hurn v. Oursler, 289 U.S. 238, 53 S.Ct. 586, 77 L.Ed. 1148; Southern Pac. Co. v. Van Hoosear, 9 Cir., 72 F.2d 903, 911	{ "pile_set_name": "FreeLaw" }
926 P.2d 545 (1996) BOARD OF COUNTY COMMISSIONERS OF DOUGLAS COUNTY; Suzy McDanal, R.A., "Chris" Christensen, and James Sullivan, individually and in their capacities as members of the Board of County Commissioners of Douglas County, Colorado; and Ed Tepe, individually and in his capacity as the Director of Planning and Community Development in Douglas County, Colorado, Petitioners/Cross-Respondents, v. John SUNDHEIM and JoAnn Scoggin Sundheim, Respondents/Cross-Petitioners, and Dorothy Rudd and Robert Rudd, Respondents. No. 95SC330. Supreme Court of Colorado, En Banc. October 28, 1996. 546 Senter Goldfarb & Rice, L.L.C., Steven J. Dawes, Susan E. Dallas, Denver, for Petitioners/Cross-Respondents. Massey Showalter & Marsh, P.C., Richard A. Marsh, Denver, for Respondents/Cross-Petitioners John Sundheim and JoAnn Scoggin Sundheim. No Appearance on Behalf of Respondents Dorothy and Robert Rudd. Cornish and Dell'Olio, Craig M. Cornish, Melissa L. Phillips, Michael W. Standard, Colorado Springs, for Amicus Curiae American Civil Liberties Union Foundation of Colorado, Inc. Hall and Evans, L.L.C., Josh A. Marks, Denver, for Amicus Curiae Colorado Counties, Inc. Colorado Municipal League, David W. Broadwell, Denver, for Amicus Curiae Colorado Municipal League. 547 Gale A. Norton, Attorney General, Timothy M. Tymkovich, Solicitor General, Garth C. Lucero, Deputy Attorney General, Timothy R. Arnold, Deputy Attorney General, Civil Litigation Section, Tort Litigation, for Amicus Curiae State of Colorado. Chief Justice VOLLACK delivered the Opinion of the Court. We granted certiorari to review the court of appeals decision in Sundheim v. Board of County Commissioners, 904 P.2d 1337 (Colo. App.1995), to determine whether the thirty-day filing limitation contained in C.R.C.P. 106(b) applies to actions where a claim for money damages is asserted under 42 U.S.C. § 1983 (1994). We also granted certiorari to determine if this court has the authority to recognize an implied damages action in cases where citizens allege that government entities have violated their state constitutional rights. The court of appeals held that a § 1983 claim can exist separately from a C.R.C.P. 106(a)(4) cause of action, thereby rendering C.R.C.P. 106(b)'s thirty-day filing requirement inapplicable. The court of appeals also held that C.R.C.P. 106(b) foreclosed any claims based solely upon the Colorado Constitution. We affirm. I. John and JoAnn Scoggin Sundheim (the Sundheims) own property in Douglas County, Colorado, on which they have operated a horse boarding and training business known as Parker Valley Farm. On January 23, 1989, the Sundheims submitted a Use by Special Review Permit application (the application) to the Douglas County Planning Department (the Department), requesting permission to continue the commercial boarding and training of hunter/jumper horses on Parker Valley Farm.[1] On January 16, 1990, the Board of County Commissioners (the board) adopted a resolution denying the application. However, based upon the observations of a hired private investigator, the board determined that commercial boarding and training activities were ongoing at Parker Valley Farm. On February 27, 1991, Ed Tepe, the Douglas County Director of Planning and Community Development, sent a letter to the Sundheims directing them to cease and desist from all commercial activities on Parker Valley Farm. The Sundheims filed suit on December 11, 1991, nearly two years after the board's January 16, 1990, resolution. The Sundheims' complaint asserted four claims for relief, two of which are relevant here. Their first claim for relief alleged that the board's denial of the application violated the Sundheims' due process and equal protection rights under the Fourteenth Amendment of the United States Constitution and § 1983. Their second claim for relief alleged that, by denying the application, the board had violated the Sundheims' due process and equal protection rights under article II, sections 3 and 25, of the Colorado Constitution.[2] The board filed a motion to dismiss under C.R.C.P. 12(b)(5). The trial court found that because the Sundheims' complaint was not filed within thirty days of the board's resolution, their claims were foreclosed by application of C.R.C.P. 106(b). Accordingly, the trial court granted the board's motion to dismiss. The Sundheims appealed. The court of appeals reversed the trial court's dismissal of the Sundheims' § 1983 claim, holding that damage claims brought under § 1983 may exist separately from the 106(a)(4) cause of action. The court of appeals then affirmed the trial court's dismissal of the Sundheims' state constitutional claims based upon the application of C.R.C.P. 106(b). II. The board argues that an action challenging a quasi-judicial decision of a governmental body and requesting money damages 548 under § 1983 must be brought within the thirty-day filing limitation set forth in C.R.C.P. 106(b). We disagree. C.R.C.P. 106(a)(4) provides in part: Where any governmental body or officer or any lower judicial body exercising judicial or quasi-judicial functions has exceeded its jurisdiction or abused its discretion, and there is no plain, speedy and adequate remedy otherwise provided by law: (I) Review shall be limited to a determination of whether the body or officer has exceeded its jurisdiction or abused its discretion, based on the evidence in the record before the defendant body or officer. .... (IX) In the event the court determines that the governmental body, officer or judicial body has failed to make findings of fact or conclusions of law necessary for a review of its action, the court may remand for the making of such findings of fact or conclusions of law. The denial of a special use permit represents a quasi-judicial action under C.R.C.P. 106(a)(4). Colorado State Bd. of Land Comm'rs v. Colorado Mined Land Reclamation Bd., 809 P.2d 974, 981 (Colo. 1991). C.R.C.P. 106(a)(4) provides the exclusive remedy for reviewing a quasi-judicial decision made by a government entity. Colorado State Bd. of Land Comm'rs, 809 P.2d at 982; Snyder v. City of Lakewood, 189 Colo. 421, 427, 542 P.2d 371, 375 (1975), overruled in part, Margolis v. District Court, 638 P.2d 297 (Colo.1981). For this reason, a C.R.C.P. 106(a)(4) complaint must include all causes of action, including constitutional claims, in a single C.R.C.P. 106(a)(4) action. Norby v. City of Boulder, 195 Colo. 231, 236, 577 P.2d 277, 281 (1978); Snyder, 189 Colo. 421, 542 P.2d 371. Additionally, C.R.C.P. 106(b)[3] requires that a complaint seeking C.R.C.P. 106(a)(4) review must be filed within thirty days of the final decision by the government entity.[4] The analysis shifts, however, when a complainant asserts a claim for money damages under § 1983 because claims under § 1983 exist as a "uniquely federal remedy" that "is to be accorded a sweep as broad as its language."[5]Felder v. Casey, 487 U.S. 131, 139, 108 S.Ct. 2302, 2307, 101 L.Ed.2d 123 (1988) (quoting Mitchum v. Foster, 407 U.S. 225, 239, 92 S.Ct. 2151, 2160, 32 L.Ed.2d 705 (1972), and United States v. Price, 383 U.S. 787, 801, 86 S.Ct. 1152, 1160, 16 L.Ed.2d 267 (1966)). The United States Supreme Court has held that when a state places procedural barriers that deny or limit the remedy available under § 1983, those barriers must give way or risk being preempted. Felder, 487 U.S. at 144-45, 108 S.Ct. at 2309-10. In Felder, the United States Supreme Court held that a Wisconsin statute requiring would-be plaintiffs to provide government entities with notice within 120 days of an alleged injury was inapplicable in an action brought under § 1983. Felder, 487 U.S. at 153, 108 S.Ct. at 2314. While recognizing that important policy considerations supported the notice of claim statute, the Supreme Court nevertheless demanded that these interests recede, explaining: 549 Sound notions of public administration may support the prompt notice requirement, but those policies necessarily clash with the remedial purposes of the federal civil rights laws. Id. at 145, 108 S.Ct. at 2310. Similarly, imposing C.R.C.P. 106(b)'s thirty-day filing deadline on the Sundheims' § 1983 action represents a procedural barrier that hinders the exercise of their federal rights. While we recognize that strict enforcement of the thirty-day limitation serves to promote government efficiency and sound municipal planning, those interests must give way to the compelling federal interest of giving § 1983 actions a broad berth.[6] For this reason, the district court erred when it dismissed the Sundheims' § 1983 claim for their failure to file the claim within thirty days as required by C.R.C.P. 106(b). Thus, the court of appeals' holding that a § 1983 damages claim may exist separately from a C.R.C.P. 106(a)(4) action is affirmed. III. In addition to their § 1983 claim, the Sundheims and an amicus curiae[7] urge this court to recognize an implied cause of action in damages for the violation of rights secured by the Colorado Constitution. To support their argument, the Sundheims point to an absence of state legislation in this area, specific provisions of the Colorado Constitution, and this court's inherent authority to fashion remedies that vindicate personal rights. We refuse to recognize an implied cause of action in this case. A. The Sundheims argue that this court has the power to recognize a remedy for violation of every right, particularly where the legislature has not yet acted. However, the absence of statutory relief for a constitutional violation does not, by itself, give rise to an implied damage remedy. See Schweiker v. Chilicky, 487 U.S. 412, 421-22, 108 S.Ct. 2460, 2466-67, 101 L.Ed.2d 370 (1988); see also Chappell v. Wallace, 462 U.S. 296, 103 S.Ct. 2362, 76 L.Ed.2d 586 (1983) (no implied damage remedy available even in the absence of a meaningful statutory remedy). The Colorado Governmental Immunity Act (CGIA), §§ 24-10-101 to -120, 10A C.R.S. (1988 & 1996 Supp.),[8] indicates that the General Assembly has carefully defined the limits of a private citizen's right to redress for the actions of government entities and officials. Section 24-10-102, 10A C.R.S. (1988), sets forth the CGIA's declared policy: It is recognized by the general assembly that the doctrine of sovereign immunity, whereunder the state and its political subdivisions are often immune from suit for injury suffered by private persons, is, in some instances, an inequitable doctrine.... The general assembly also recognizes that the state and its political subdivisions provide essential public services 550 and functions and that unlimited liability could disrupt or make prohibitively expensive the provision of such essential public services and functions. The general assembly further recognizes that the taxpayers would ultimately bear the fiscal burdens of unlimited liability and that limitations on the liability of public entities and public employees are necessary in order to protect the taxpayers against excessive fiscal burdens. The CGIA clearly sought to balance the interests of citizens seeking relief from governmental abuses of power against the public interest of maintaining an efficient and fiscally responsible government. While it does not address the issue of constitutional violations directly, the CGIA clearly defines the boundaries within which aggrieved citizens may obtain relief. Similarly, in adopting the Colorado Rules of Civil Procedure, we have balanced competing concerns in C.R.C.P. 106(a)(4). C.R.C.P. 106(a)(4) provides citizens with judicial review and prevents decision-making bodies from abusing their discretionary power. However, record review and C.R.C.P. 106(b)'s thirty-day filing deadline balance a citizen's right to have his or her case heard against the need for efficient municipal planning. See Snyder, 189 Colo. at 428, 542 P.2d at 376. The CGIA and C.R.C.P. 106(a)(4) clearly support an intent on behalf of the general assembly and this court to balance the rights of aggrieved citizens against legitimate government concerns. Creating a new constitutional cause of action could seriously alter the delicate balance between these competing policies. B. Article II, section 6, of the Colorado Constitution provides: Courts of justice shall be open to every person, and a speedy remedy afforded for every injury to person, property or character; and right and justice should be administered without sale, denial or delay. The Sundheims interpret article II, section 6, to authorize the courts of this state to provide remedies when citizens suffer an injury to themselves or their property. Article II, section 25, of the Colorado Constitution provides: No person shall be deprived of life, liberty or property, without due process of law. By reading article II, section 6, together with article II, section 25, the Sundheims argue that Colorado courts may recognize an implied damages action to effectuate a citizen's due process rights. We do not read these constitutional provisions so broadly. Article II, section 6, requires the courts of this state to recognize when a citizen's rights are violated and effectuate those rights by applying legally established remedies. Dove v. Delgado, 808 P.2d 1270, 1275 (Colo.1991); Curtiss v. GSX Corp. of Colorado, 774 P.2d 873, 876 (Colo.1989); O'Quinn v. Walt Disney Prods., Inc., 177 Colo. 190, 195, 493 P.2d 344, 346 (1972). As these cases make clear, the equal justice provision provides citizens with access to state courts while guaranteeing the availability of necessary remedies. Dove, 808 P.2d at 1275. In no way does article II, section 6, obligate Colorado courts to create remedies where none currently exist.[9] From these facts, it is clear that article II, section 6, and article II, section 25, do not provide a strong basis for recognition of an implied constitutional cause of action. C. The Sundheims next assert that Bivens v. Six Unknown Named Agents of Federal Bureau of Narcotics, 403 U.S. 388, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971), authorizes this court to recognize an implied damages action where a citizen has been deprived of state constitutional rights. To fully understand this issue, we must review Bivens, its progeny, and the relevant decisions of state courts that have been asked to recognize an implied cause of action. 551 In Bivens, the United States Supreme Court held that a private citizen could sue a federal agent for damages stemming from violations of the citizen's Fourth Amendment rights. More importantly, the Court inferred this cause of action even though no federal statute authorized such a remedy. Bivens, 403 U.S. at 394-97, 91 S.Ct. at 2003-05. In support of its holding, the Supreme Court reasoned: Of course, the Fourth Amendment does not in so many words provide for its enforcement by an award of money damages for the consequences of its violation. But "it is ... well settled that where legal rights have been invaded, and a federal statute provides for a general right to sue for such invasion, federal courts may use any available remedy to make good the wrong done." Id. at 396, 91 S.Ct. at 2004 (quoting Bell v. Hood, 327 U.S. 678, 684, 66 S.Ct. 773, 777, 90 L.Ed. 939 (1946)).[10] The Bivens Court also noted two instances where creation of an implied remedy would be unwarranted: (1) if "special factors counselling hesitation in the absence of affirmative action by Congress" were present; or (2) if there was an "explicit congressional declaration" prohibiting money damages and remitting the plaintiff to an equally effective substitute remedy. Id. at 396-97, 91 S.Ct. at 2005. Subsequent Supreme Court case law has extended Bivens by authorizing implied damage actions for other constitutional violations. See Davis, 442 U.S. 228, 99 S.Ct. 2264, 60 L.Ed.2d 846 (damages remedy was "surely appropriate" to remedy equal protection violation under the Fifth Amendment); Carlson v. Green, 446 U.S. 14, 100 S.Ct. 1468, 64 L.Ed.2d 15 (1980) (presence of claim against government under Federal Tort Claims Act does not foreclose Bivens action against individual government defendants who may have violated plaintiffs' Eighth Amendment rights). It was not until Bush v. Lucas, 462 U.S. 367, 103 S.Ct. 2404, 76 L.Ed.2d 648 (1983), and Chappell v. Wallace, 462 U.S. 296, 103 S.Ct. 2362, 76 L.Ed.2d 586 (1983), that the United States Supreme Court began to limit the Bivens holding. In Bush, the plaintiff was fired from his position at the National Aeronautics and Space Administration (NASA) for making critical comments about NASA and his superiors. Even though the plaintiff was subsequently reinstated with back pay by the Civil Service Commission's Appeals Review Board, he filed a Bivens action alleging that his First Amendment rights had been violated. The Bush Court refused to infer a cause of action due to its reluctance to circumvent an elaborate remedial system that addressed complaints made by civil service employees.[11]Bush, 462 U.S. at 388, 103 S.Ct. at 2416. For this reason, the Bush Court chose to defer to Congress rather than create a new cause of action, holding: [W]e decline "to create a new substantive legal liability without legislative aid ..." because we are convinced that Congress is in a better position to decide whether or not the public interest would be served by creating it. Id. at 390, 103 S.Ct. at 2417 (citation omitted). 552 Chappell involved a Bivens action brought by five enlisted men serving in the United States Navy who alleged that their superiors had violated their constitutional rights. The Supreme Court refused to recognize a Bivens action even though the sailors had no other remedy available to them. Chappell, 462 U.S. at 305, 103 S.Ct. at 2368. The Chappell Court determined that the military structure of discipline and the exercise of congressional authority over the military represented "special factors counselling hesitation" that justified denying the Bivens remedy. Id. at 303-04, 103 S.Ct. at 2367-68. Finally, Schweiker v. Chilicky, 487 U.S. 412, 108 S.Ct. 2460, 101 L.Ed.2d 370 (1988), concerned plaintiffs seeking damages for a gap in benefits caused by the termination and subsequent reinstatement of disability payments under Title II of the Social Security Act. After summarizing the Bivens line of cases, the Schweiker Court explained: In sum, the concept of "special factors counselling hesitation in the absence of affirmative action by Congress" has proved to include an appropriate judicial deference to indications that congressional inaction has not been inadvertent. When the design of a Government program suggests that Congress has provided what it considers adequate remedial mechanisms for constitutional violations that may occur in the course of its administration, we have not created additional Bivens remedies. Id. at 423, 108 S.Ct. at 2467. Relying heavily upon Bush, the Schweiker Court refused to infer a damages action when it was apparent that Congress had carefully weighed competing public policies in defining the limits of recovery for social security claimants. Id. at 424-29, 108 S.Ct. at 2468-71. The more recent Supreme Court cases interpreting Bivens suggest that implied damage actions are not appropriate for every violation of a citizen's constitutional rights. The emergence of "special factors counselling hesitation" foreclosing the Bivens remedy has grown increasingly important and indicates a judicial willingness to defer the creation of new damage remedies to Congress. See Schweiker, 487 U.S. at 423, 108 S.Ct. at 2467; Bush, 462 U.S. at 390, 103 S.Ct. at 2417. This is especially true when there are other, more appropriate, remedies available or when Congress has chosen to limit or deny a remedy altogether. See Schweiker, 487 U.S. 412, 108 S.Ct. 2460, 101 L.Ed.2d 370; Chappell, 462 U.S. 296, 103 S.Ct. 2362, 76 L.Ed.2d 586; Bush, 462 U.S. 367, 103 S.Ct. 2404, 76 L.Ed.2d 648. State courts have been skeptical when asked to recognize implied damage actions in cases involving licensing and zoning determinations. Shields v. Gerhart, 163 Vt. 219, 658 A.2d 924 (1995); Kelley Property Dev. v. Town of Lebanon, 226 Conn. 314, 627 A.2d 909 (1993); Rockhouse Mountain Property Owners Ass'n v. Conway, 127 N.H. 593, 503 A.2d 1385 (1986). Kelley involved the denial of a real estate developer's application for subdivision approval by town officials. Relying upon similar provisions of the Connecticut Constitution[12] to those cited by the Sundheims, the developer filed suit against the town officials for damages arising from the alleged denial of his due process rights. After disposing of the developer's constitutional argument, the Kelley court refused to recognize an implied damages action under the facts before it. Kelley, 627 A.2d at 924. As a general matter, the court stated that it should not recognize a private damages action based on its state constitution if "the legislature has provided a reasonably adequate statutory remedy." Id., 627 A.2d at 922. Relying upon a statute that provides for judicial review of a board determination in similar fashion to C.R.C.P. 106(a)(4), the court found that this remedy, coupled with other causes of action such as tortious interference 553 or injunctive relief, weighed "heavily against judicial creation of a state Bivens action." Id. at 923. The Kelley court also found that policy considerations weighed against recognizing an implied cause of action. The court pointed out that the existing remedies were particularly appropriate in light of the fact that the officials involved were laypersons with little or no technical expertise. Id. at 923. Exposing these officials, or the town itself, to liability in damages was likely "to have adverse consequences on the parties, local zoning processes, and the courts."[13]Id. at 923. The court concluded that existing remedies struck a proper balance between the needs of disappointed zoning applicants and the potential burdens on towns, zoning commissions, and the courts. Id. at 924. IV. While it may be appropriate to recognize an implied state constitutional cause of action when there is no other adequate remedy, we agree with the approach taken by the court in Kelley that where other adequate remedies exist, no implied remedy is necessary. Under the facts of this case, C.R.C.P. 106(a)(4) represents the proper method for challenging a zoning determination. Additionally, without addressing the merits of their claim, we conclude that the Sundheims' § 1983 claim should be severed from the time-barred C.R.C.P. 106(a)(4) cause of action. The availability of these statutory remedies therefore makes judicial creation of an implied damages remedy unnecessary in this case.[14] The court of appeals' decision remanding the Sundheims' § 1983 action is affirmed. NOTES [1] The application was opposed by Dorothy and Robert Rudd, named defendants and owners of property adjacent to Parker Valley Farm; however, our grant of certiorari is limited to actions taken by the board. [2] The Sundheims also alleged that the board and others conspired to deprive them of their rights in violation of 42 U.S.C. § 1985 (1994) and that the board, county officials and others had violated their right to privacy. [3] C.R.C.P. 106(b) provides in part: If no time within which review may be sought is provided by any statute, a complaint seeking review under subsection (a)(4) of this Rule shall be filed in the district court not later than thirty days after the final decision of the body or officer. [4] In Snyder, we underscored the importance of C.R.C.P. 106(b)'s thirty day filing requirement: The present controversy has continued for over two years, the effect of which is that the surrounding landowners, the Church, the City and many other interested persons and organizations have been living under a cloud of uncertainty which is not compatible with modern comprehensive planning. The interests of all will be served if a challenger to a rezoning determination must prosecute all his causes in one certiorari action and bring it within 30 days of "final action" unless a statute or municipal ordinance provides otherwise. Snyder, 189 Colo. at 428, 542 P.2d at 376 (citation omitted). [5] Actions pursuant to 42 U.S.C. § 1983 are subject to state statutes of limitation for personal injury claims to foster uniformity and certainty among the states. Wilson v. Garcia, 471 U.S. 261, 105 S.Ct. 1938, 85 L.Ed.2d 254 (1985). In Colorado, actions brought under § 1983 are subject to a two-year statute of limitations. See § 13-80-102, 6A C.R.S. (1987). [6] We recognized the compelling interest served by 42 U.S.C. § 1983 actions in Espinoza v. O'Dell, 633 P.2d 455 (Colo.1981), where we explained: The two principal policies underlying a § 1983 action are compensation and deterrence. Where the government itself becomes the source of danger to an individual's rights, in the absence of some effective mode of redress, the person would be defenseless in the face of official lawlessness. The § 1983 remedy serves to supplement available state remedies. Because the wrongdoer acts with special authority under color of his governmental office or employment, the danger of his misuse of power is greater for those subject to it than would be the case if the wrongdoer were acting merely as an individual. His potential liability for violation of another's federal rights serves to restrain illegal behavior and to encourage good faith performance of official duties. Espinoza, 633 P.2d at 464 (citations omitted). [7] The American Civil Liberties Union Foundation of Colorado, Inc., as amicus curiae, filed a brief urging the recognition of an implied cause of action. Colorado Counties, Inc., and Colorado Municipal League, as amici curiae, filed a brief opposing recognition of an implied cause of action. [8] As a means of providing relief to citizens injured by the otherwise immune acts of government entities and officials, the CGIA waives immunity in certain circumstances. However, this waiver does not specifically include the violation of a citizen's state constitutional rights. See § 24-10-106, 10A C.R.S. (1988 & 1996 Supp.). [9] Furthermore, this court has refused to enforce the equal justice provision when citizens fail to pursue their vested rights in a timely manner. Dove, 808 P.2d at 1275. [10] Clearly, the fact that there was no other remedy available to the plaintiff weighed heavily on the Bivens Court's decision. Justice Harlan stated in his concurrence that in this case, it was "damages or nothing." Id. at 410, 91 S.Ct. at 2012. The lack of a meaningful remedy was also emphasized in Davis v. Passman, 442 U.S. 228, 245, 99 S.Ct. 2264, 2277, 60 L.Ed.2d 846 (1979), where no effective remedy was available to the plaintiff because the congressman she accused of gender discrimination was no longer in office. [11] The Bush Court reasoned: The question is not what remedy the court should provide for a wrong that would otherwise go unredressed. It is whether an elaborate remedial system that has been constructed step by step, with careful attention to conflicting policy considerations, should be augmented by the creation of a new judicial remedy for the constitutional violation at issue. The question obviously cannot be answered simply by noting that existing remedies do not provide complete relief for the plaintiff. The policy judgment should be informed by a thorough understanding of the existing regulatory structure and the respective costs and benefits that would result from the addition of another remedy for violations of employees' First Amendment rights. Bush, 462 U.S. at 388, 103 S.Ct. at 2416. [12] Article first, § 10, of the Connecticut Constitution provides: All courts shall be open, and every person, for an injury done to him in his person, property or reputation, shall have remedy by due course of law, and rights and justice administered without sale, denial or delay. Article first, § 8, of the Connecticut Constitution provides: No person shall ... be deprived of life, liberty or property without due process of law.... [13] These consequences included: (1) a "chilling effect" on the zeal with which zoning commissions undertake their responsibilities; and (2) a substantial financial burden on local governments caused by encouraging disgruntled zoning applicants to bring damage actions whenever they are denied a permit or application. Id., 627 A.2d at 923-24. [14] In addition to 42 U.S.C. § 1983, additional claims could have included regulatory takings, intentional interference with contractual relations, or intentional interference with a prospective business advantage. See Sundheim, 904 P.2d at 1348-49; Kelley, 627 A.2d at 923. As a consequence, the Sundheims were not lacking in potential damage remedies.	{ "pile_set_name": "FreeLaw" }
115 Ill. App.2d 403 (1969) 253 N.E.2d 581 David W. Jones, Plaintiff, v. McDougal-Hartmann Co., a Foreign Corporation, Defendant and Third-Party Plaintiff-Appellant, v. Robert J. Janssen, d/b/a R.J. Janssen Painting and Decorating Company, Third-Party Defendant-Appellee. Gen. No. 69-8. Illinois Appellate Court Third District. October 14, 1969. Rehearing denied December 1, 1969. 404 Robert C. Strodel, of Peoria, for appellant. Cassidy, Cassidy, Quinn & Lindholm, and McConnell, Kennedy, McConnell & Morris, of Peoria, for appellee. STOUDER, P.J. David Jones commenced this action in the Circuit Court of Peoria County seeking to recover damages for personal injuries from McDougal-Hartmann Company on account of violation of the Structural Work Act. McDougal-Hartmann filed a third-party action against Robert J. Janssen, d/b/a R.J. Janssen Painting and Decorating Company, Jones' employer, seeking recovery from Janssen on the theory of common-law indemnity. For the purpose of trial, the actions were severed and a jury trial of the Jones' claim against McDougal-Hartmann resulted in a verdict in favor of Jones for $50,000. This judgment has been satisfied and we are not concerned with the propriety of this judgment in this appeal. McDougal-Hartmann's third-party action against Janssen in a separate trial by jury, resulted in a not guilty verdict. McDougal-Hartmann's post-trial motions were denied, and this appeal follows. For convenience McDougal-Hartmann, Appellant and Third-Party Plaintiff, will be referred to as Plaintiff, and Janssen, Third-Party Defendant-Appellee, will be referred to as Defendant. The evidence presented at the trial on the third-party complaint was practically the same evidence presented during the original trial and is substantially undisputed. The plaintiff, a general contractor, entered into a contract 405 with the State of Illinois for the construction of a portion of an interstate freeway in Peoria, Illinois. The project included construction of at least one overpass which required painting, for which work the defendant had submitted a bid. The defendant had worked on other projects of the plaintiff. Plaintiff orally requested that defendant proceed to paint the structural steel on the overpass. On the morning of November 19, 1963, Jones, a journeyman painter, Winborn, and one Gess, an apprentice painter, met at Janssen's home. Scaffolds, ladders, drop cloths, etc. were loaded into Janssen's truck and he drove the truck, together with the painting crew, to the job site. All of the equipment was owned by Janssen. When they arrived at the job site, Janssen instructed the crew as to what work was to be done and they commenced rigging cables preparatory to the actual painting. Janssen stayed on the job site about half an hour and returned once sometime before noon during the period prior to the occurrence involved. None of the members of the painting crew was designated as foreman. When the painting crew arrived on the job, a cement finishing crew of plaintiff's was working on a column. The foreman of the cement finishing crew told the painting crew to be sure that the columns were covered with drop cloths so that they would not be spattered with paint. This crew left the job site before noon while the painting crew was still stringing cables for its scaffolds. During the course of the morning, a McDougal-Hartmann truck came along the roadway under the bridge, stopped momentarily, and then proceeded on. No one left the truck or communicated with the painters who at this time were still stringing cables. Between 2 and 2:30 in the afternoon Jones went from the completed scaffold to a ladder which was leaning against a column. The bottom of the ladder was not braced or held by another person. Jones attempted to kick 406 the top of the ladder from the column in order to replace a drop cloth which had blown from around the column and in so doing, the ladder twisted causing Jones to fall to the ground, permanently injuring him. As Jones began to descend the ladder, he was warned by painter Winborn not to try to descend the ladder in such a manner and position. Jones told Winborn not to tell him what to do. In its third-party action, plaintiff sought to recover $50,000 (amount of Jones' judgment) together with attorney's fees for defending the original action against defendant. The jury found the issues in favor of defendant and it is the judgment entered thereon from which plaintiff has appealed. Plaintiff's action is based on its assertion that its violation of the Structural Work Act was merely passive and the defendant's violation thereof was active. Plaintiff's principal argument is that it should be entitled to recover as a matter of law and hence the court erred in failing either to direct a verdict in its favor or to grant its motion for judgment notwithstanding the verdict. [1] John Griffiths & Son Co. v. National Fireproofing Co., 310 Ill. 331, 141 NE 739, is a leading case on the subject of indemnity, both contractual and common law. It recognizes that there are certain relationships such as between contractor and subcontractor in the instant case, where the ultimate financial burden of injuries may be shifted to the party deemed most responsible. To avoid the application of the rule of no contribution among joint tort-feasors, common-law indemnity depends on differences in the quality of the conduct of the parties. Chicago & Midland Ry. Co. v. Evans Const. Co., 32 Ill.2d 600, 208 NE2d 573. This may well represent a matter of policy depending on the relation involved, and it is difficult to formulate standards applicable to all situations. 407 [2, 3] Miller v. DeWitt, 37 Ill.2d 273, 226 NE2d 630, confirms two general principles applicable to indemnity between parties similarly situated as those in the instant case. In the first place, indemnity is not barred because it may result in an employee receiving and an employer paying an amount in excess of that provided in the Workmen's Compensation Act. In the second place, the party seeking indemnity is not barred merely because both parties may have violated the Structural Work Act. The "willfulness" which is an element of any violation of the Structural Work Act, does not prevent the passive wrongdoer from shifting the financial burden to the active wrongdoer. [4] In Rovekamp v. Central Const. Co., 45 Ill. App.2d 441, 195 NE2d 756 (quoted with approval in Miller v. De Witt, supra), the court stated, "Although the liability imposed by the (Structural Work) Act does not rest upon negligence, there can be degrees of fault among those who, under the Act, are accountable to an injured plaintiff. Who is the more culpable, a party who supervises and coordinates the overall project, or a party who is responsible for the scaffolding and the particular work which produced the injury? Both are in charge of the work, to be sure, but of different phases of the work. Neither can escape liability to the (injured) plaintiff thus the purpose of the Act is accomplished but the lesser delinquent, if held accountable by the plaintiff, can transfer its statutory liability to the active delinquent, whose dereliction from duty brought about the plaintiff's injury." See also Moroni v. Intrusion-Prepakt, Inc., 24 Ill. App.2d 534, 165 NE2d 346. A subcontractor is usually a specialist whose contract ordinarily provides for the accomplishment of a particular result, the means of accomplishing such result being the choice of the subcontractor. Further, the subcontractor ordinarily furnishes the equipment and personnel and such equipment and personnel are under the control, authority and direction of 408 the subcontractor in the performance of the subcontract. With respect to the work the subcontractor has undertaken to perform, he does have a greater responsibility and duty with respect thereto than a contractor exercising general authority over the entire job. Consequently, when the basis of a claim for indemnity arises on account of injuries to third persons which are incident to the performance of a subcontract, and there is no participation by the general contractor in such performance, we believe the subcontractor's conduct is the active wrongdoing thereby requiring indemnity. In Sack v. Arcole Mid-West Corp., 33 Ill. App.2d 344, 179 NE2d 441, the court affirmed a directed verdict in favor of the third-party plaintiff (general contractor) against the third-party defendant (subcontractor). In that case the third-party defendant, a plumbing subcontractor, owned, designed and furnished a scaffold with respect to which an employee was injured because the guardrail was improperly and insecurely fastened. The employee recovered for his injuries from the general contractor, who thereupon sought indemnity from the subcontractor. The third-party plaintiff had a superintendent on the job who had seen the scaffold and approved it. The court concluded that the injury resulted from an activity within the sole control and responsibility of the third-party defendant and therefore, the court held the injury to be the result of active misconduct as a matter of law. We believe the principle of the Sack case is applicable to the facts in the instant case. Defendant argues that the Sack case involves defective equipment, a condition which did not exist in the instant case. We are, however, unable to understand such distinction. Is an improperly fastened guardrail different in kind from an improperly braced ladder? Furthermore, in Sack the subcontractor was not accused of the deliberate or intentional furnishing of a defective scaffold. Rather, his breach of duty was the failure to discover and remedy the unsafe condition. 409 [5] In the instant case, the facts as well as the inferences to be drawn therefrom are undisputed. In our opinion, the only conclusion that can be drawn therefrom is that defendant's misconduct was active, while that of the plaintiff passive. In our opinion the Circuit Court of Peoria County erred in denying the third party plaintiff's motion for judgment notwithstanding the verdict. Accordingly the judgment of said Court is reversed and remanded with directions that judgment be entered in favor of such third party plaintiff in accord with the views expressed herein. Judgment reversed and remanded with directions. ALLOY and RYAN, JJ., concur.	{ "pile_set_name": "FreeLaw" }
NOT RECOMMENDED FOR FULL-TEXT PUBLICATION File Name: 16a0478n.06 Case No. 14-5368 UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT FILED Aug 16, 2016 DANIEL CARR, ) DEBORAH S. HUNT, Clerk ) Petitioner-Appellant, ) ) ON APPEAL FROM THE UNITED v. ) STATES DISTRICT COURT FOR ) THE MIDDLE DISTRICT OF UNITED STATES OF AMERICA, ) TENNESSEE ) Respondent-Appellee. ) ) ) BEFORE: STRANCH, DONALD, and LIPEZ, Circuit Judges.* BERNICE BOUIE DONALD, Circuit Judge. At its core, this case presents the question of whether the Sex Offender Registration and Notification Act (“SORNA”), 42 U.S.C. §§ 16901 et seq, required Daniel Carr (“Carr”) to register with authorities in Tennessee when he moved from Tennessee to Mexico. Pursuant to the Supreme Court’s recent decision in Nichols v. United States, 136 S. Ct. 1113 (2016), we conclude that it does not. We therefore REVERSE the district court’s denial of Carr’s 28 U.S.C. § 2255 motion and REMAND with instructions to vacate his conviction. We also treat Carr’s request for release from civil commitment as a *The Honorable Kermit V. Lipez, Circuit Judge for the United States Court of Appeals for the First Circuit, sitting by designation. Case No. 14-5368, Carr v. United States habeas corpus petition and REMAND to the district court with instructions to transfer it to the United States District Court for the Eastern District of North Carolina. I. A. Factual and Procedural Background On October 13, 1999, Carr was convicted of aggravated sexual battery in Tennessee. He received an eight year prison sentence, and was released under lifetime supervision in September 2006. On November 28, 2007, Carr was convicted of sexual battery and violating his supervision terms. While still imprisoned, Carr signed a Tennessee Bureau of Investigation Sexual Offender/Violent Sexual Offender Instructions form. By signing, Carr indicated that he understood Tennessee’s sex-offender registration requirements. One requirement was that he register in person with a designated law enforcement agency within forty-eight hours of establishing or changing a primary or secondary residence. After his release on March 27, 2009, Carr did not report to his probation officer. After deciding to relocate to Mexico, Carr took a bus from Nashville to Mexico on May 30, 2009. On April 21, 2009, Tennessee issued an arrest warrant alleging that he failed to comply with the state’s sex offender registration requirements. Mexican authorities arrested Carr on June 9, 2009, and expelled him from the country. The federal government indicted him in the United States District Court for the Middle District of Tennessee for “knowingly fail[ing] to register and update his registration in Tennessee as required, and [] travel[ing] in interstate commerce from Tennessee to Mexico” in violation of 18 U.S.C § 2250. Appellee Br. 6. On November 24, 2010, Carr entered a conditional guilty plea to the indictment and reserved only the right to appeal the district court’s refusal to dismiss the indictment. He received a forty-one month prison sentence with credit for time served. Carr’s projected release -2- Case No. 14-5368, Carr v. United States date from the Federal Bureau of Prisons was June 1, 2012. However, the federal government filed a petition to civilly commit Carr under the Adam Walsh Act, 18 U.S.C. § 4248(a) in the United States District Court for the Eastern District of North Carolina. The petition was before the district court in North Carolina because Carr was imprisoned in North Carolina. On September 23, 2013, Carr filed a motion to vacate, set aside, or correct a sentence under 28 U.S.C. § 2255 and requested to be released from civil commitment. Carr alleged that his counsel was ineffective for failing to argue that he was not subject to SORNA’s requirements. The district court denied Carr’s motion. It held that SORNA imposed a duty to update his registration in Tennessee prior to his departure to Mexico, and that his counsel’s failure to argue otherwise did not cause prejudice because it would have rejected the argument. Carr filed a pro-se notice of appeal after the district court denied his motion to reconsider. Judge Merritt issued a certificate of appealability (“COA”) on the following issues: (1) whether Carr was required to register or update his registration under SORNA upon changing his residence to Mexico, and (2) whether Carr’s counsel rendered ineffective assistance by failing to raise this argument. Judge Merritt also appointed counsel for Carr. At the parties’ behest, we ultimately held this case in abeyance pending a decision in Nichols. B. Applicable Law We include SORNA’s statutory provisions here as they are highly relevant. 18 U.S.C. § 2250. Failure to register (a) In General.—Whoever— (1) is required to register under the Sex Offender Registration and Notification Act; (2)(A) is a sex offender as defined for the purposes of the Sex Offender Registration and Notification Act by reason of a conviction under Federal law (including the Uniform Code of Military Justice), the law of the District of Columbia, Indian tribal law, or the law of any territory or possession of the United States; or -3- Case No. 14-5368, Carr v. United States (B) travels in interstate or foreign commerce, or enters or leaves, or resides in, Indian country; and (3) knowingly fails to register or update a registration as required by the Sex Offender Registration and Notification Act; shall be fined under this title or imprisoned not more than 10 years, or both. 42 U.S.C. § 16911. Relevant definitions, including Amie Zyla expansion of sex offender definition and expanded inclusion of child predators … (10) Jurisdiction. The term “jurisdiction” means any of the following: (A) A State. (B) The District of Columbia. (C) The Commonwealth of Puerto Rico. (D) Guam. (E) American Samoa. (F) The Northern Mariana Islands. (G) The United States Virgin Islands. (H) To the extent provided and subject to the requirements of section 16927 of this title, a federally recognized Indian tribe. … (13) Resides The term “resides” means, with respect to an individual, the location of the individual’s home or other place where the individual habitually lives. 42 U.S.C. § 16913. Registry requirements for sex offenders (a) In general A sex offender shall register, and keep the registration current, in each jurisdiction where the offender resides, where the offender is an employee, and where the offender is a student. For initial registration purposes only, a sex offender shall also register in the jurisdiction in which convicted if such jurisdiction is different from the jurisdiction of residence. -4- Case No. 14-5368, Carr v. United States (b) Initial registration The sex offender shall initially register— (1) before completing a sentence of imprisonment with respect to the offense giving rise to the registration requirement; or (2) not later than 3 business days after being sentenced for that offense, if the sex offender is not sentenced to a term of imprisonment. (c) Keeping the registration current A sex offender shall, not later than 3 business days after each change of name, residence, employment, or student status, appear in person in at least 1 jurisdiction involved pursuant to subsection (a) and inform that jurisdiction of all changes in the information required for that offender in the sex offender registry. That jurisdiction shall immediately provide that information to all other jurisdictions in which the offender is required to register. III. Both parties agree that this Court has jurisdiction. The district court had jurisdiction under 28 U.S.C. § 2255. This Court has jurisdiction under 28 U.S.C. §1291. IV. In reviewing the denial of a 28 U.S.C. § 2255 motion, we evaluate the district court’s legal conclusions de novo and factual findings for clear error. Dawson v. United States, 702 F.3d 347, 349 (6th Cir. 2012). We agree with the parties that Nichols applies retroactively on collateral review because it announced a substantive new rule under the Teague framework. See Welch v. United States, 136 S. Ct. 1257, 1264 (2015); Teague v. Lane, 489 U.S. 288 (1989). The fact that Nichols did not cite a single Supreme Court case interpreting SORNA or its predecessor statute demonstrates that Nichols was not compelled by existing precedent, and should therefore be considered “new.” See Welch, 136 S. Ct. at 1264. Moreover, Nichols announced a -5- Case No. 14-5368, Carr v. United States substantive rule that “alters the range of conduct or the class of persons that the law punishes.” Schriro v. Summerlin, 542 U.S. 348, 353 (2004). In Nichols, the defendant, a sex-offender required to register under SORNA, moved from Kansas to the Philippines without notifying Kansas authorities. Nichols, 136 S. Ct. at 1115. The defendant conditionally pled guilty to violating SORNA. Id. at 1117. The Supreme Court noted that 42 U.S.C. § 16911(10) does not require a sex-offender to register in a foreign country. Id. at 1117. Moreover, the Supreme Court found that 42 U.S.C. § 16913 does not require sex offenders to update their registration in the jurisdictions they have left when they relocated to another jurisdiction. Id. We agree with both parties that SORNA did not criminalize Carr’s failure to register with Tennessee authorities once he moved to Mexico. Id. Consequently, his guilty plea could not have been knowingly and intelligently made. See Waucaush v. United States, 380 F.3d 251, 257 (6th Cir. 2004) (“This type of misunderstanding—a misconception about the statute’s legal scope that results in the defendant pleading guilty to conduct which was not a crime—typifies an unintelligent guilty plea.”). A guilty plea that is not knowing and intelligent contravenes due process. Brady v. United States, 397 U.S. 742, 748 (1970). Therefore, Carr’s conviction was contrary to the Constitution, and we must set it aside. 28 U.S.C. § 2255. Furthermore, we agree with the parties that Carr’s request for release from civil commitment should be treated as a habeas petition under 28 U.S.C. § 2241 and transferred to the United States District Court for the Eastern District of North Carolina. V. In conclusion, we REVERSE the district court’s denial of Carr’s 28 U.S.C. § 2255 motion and REMAND with instructions to set aside Carr’s conviction. We also construe his -6- Case No. 14-5368, Carr v. United States request for release from civil commitment as a habeas corpus petition under 28 U.S.C. § 2241 and REMAND with instructions transfer it to the United States District Court for the Eastern District of North Carolina. -7-	{ "pile_set_name": "FreeLaw" }
150 F.3d 747 77 Fair Empl.Prac.Cas. (BNA) 800,76 Empl. Prac. Dec. P 45,403Merlee EILAND, Plaintiff-Appellant,v.TRINITY HOSPITAL, Defendant-Appellee. No. 97-3165. United States Court of Appeals,Seventh Circuit. Argued May 22, 1998.Decided July 24, 1998. Armand L. Andry (argued), Oak Park, IL, for Plaintiff-Appellant. Oswald G. Lewis, Hubert O. Thompson (argued), Carney & Brothers, Chicago, IL, for Defendant-Appellee. Before FLAUM, RIPPLE and KANNE, Circuit Judges. RIPPLE, Circuit Judge. 1 Merlee Eiland sued her employer, Trinity Hospital, alleging disparate treatment and retaliatory discharge based on racial discrimination in violation of Title VII and 42 U.S.C. § 1981. The district court granted summary judgment to Trinity Hospital. Ms. Eiland appeals that decision. For the reasons set forth below, we affirm the district court's judgment. 2 * BACKGROUND 3 Ms. Eiland, an African American, worked in a dozen hospitals after she became a Licensed Practical Nurse in 1971, and in none of them was she disciplined or fired. However, on February 19, 1996, after she had worked in the Occupational Health Center ("OHC") of Trinity Hospital for almost 2 years, the hospital terminated her employment. Ms. Eiland's suit, filed after receipt of her right-to-sue letter from the Equal Employment Opportunity Commission, alleges that the hospital intentionally discriminated against her because of her race and retaliated against her because she filed complaints of discrimination. 4 The allegations that she was discharged because of her race are based on several incidents involving a hospital staff physician. According to Ms. Eiland, on three occasions the staff physician showed her newspaper articles that portrayed African Americans in negative ways. She alleges that he commented on the articles in a racially biased way. He also made, according to her allegations, derogatory statements about African Americans sitting in the hospital's waiting room. The complaint also alleges that Ms. Eiland overheard the staff physician using the word "nigger" when telling his co-workers a story about a slave owner in pre-civil war Mississippi. When she confronted him, however, he denied using the term. Nevertheless, she reported the incident to Jan Kois, the OHC's supervisor. Kois turned the complaint over to the Human Resources Department; it found that no improprieties had occurred. Ms. Eiland's complaint alleges that her superiors did nothing to stop the derogatory comments about African Americans made by a staff physician and by other white staff. 5 Ms. Eiland's complaint also states that she administered a measles, mumps and rubella injection ("MMR shot") to a patient after a staff physician failed to advise her that the patient was pregnant and after the patient had stated that she was not pregnant. She reports that she was terminated by the hospital "allegedly because of the medication error," R.1 p 21, but actually for racial reasons. 6 The hospital responds that Ms. Eiland's supervisor, Jan Kois, terminated Ms. Eiland's employment because "she was a threat to patients in terms of negligent patient care." R.18, Ex.B at 60. On February 16, 1996, Ms. Eiland administered an MMR shot to a pregnant female patient. Because an MMR shot could harm the mother and the unborn child, the hospital's policy requires that, before a female patient is given an immunization shot, the nurse must read the patient's chart, give the patient a brochure explaining the risks of the shot, talk to the patient about the risks, have the patient sign the brochure, and ask whether the patient is pregnant. The staff physician submitted an incident report to Kois stating that a patient had reported to him that Ms. Eiland had given her an MMR shot on February 16 without inquiring about her pregnancy status. The staff physician asserted that he had examined the patient on February 9, 1996, a week before the injection was given, and had indicated on her chart that she was pregnant. He also had made the chart available to Ms. Eiland. 7 On February 19, 1996, nursing supervisor Kois suspended Ms. Eiland pending an investigation of the incident. She then conducted a hearing on the matter and determined that Ms. Eiland had not followed the hospital policy, had not considered the protocol important and had shown no remorse for her mistake or for the possible harm to the unborn child. Later that day, Kois terminated Ms. Eiland's employment with Trinity Hospital based on this incident. 8 The district court granted the hospital's motion for summary judgment. It noted that Ms. Eiland's complaint and affidavit had alleged that the staff physician did not advise Ms. Eiland that the patient was pregnant and that the patient herself had told Ms. Eiland that she was not pregnant. However, stated the court, Ms. Eiland failed to include those assertions in her Rule 12(N) statement or to support her allegations with evidence. The court then determined that Ms. Eiland's disparate treatment claim failed because she established no link between the staff physician's allegedly racist statements and her termination by Jan Kois. The court held that Ms. Eiland also failed to establish her retaliation claim: She did not demonstrate that the hospital's nondiscriminatory reason for her discharge--that Kois believed the nurse was a threat to patient safety--was pretextual. The court also concluded that the record did not permit any racial or retaliatory animus on the staff physician's part to be imputed to Kois' final decision. It granted summary judgment to the hospital. II DISCUSSION A. Summary Judgment 9 Our review of a district court's entry of summary judgment is plenary. See Talanda v. KFC Nat'l Mgmt. Co., 140 F.3d 1090, 1095 (7th Cir.), petition for cert. filed, 67 U.S.L.W. 3093 (U.S. July 2, 1998) (No. 98-37). Our review considers the record in the light most favorable to the nonmoving party, Ms. Eiland, and draws all reasonable inferences in that party's favor. See Gonzalez v. Ingersoll Milling Mach. Co., 133 F.3d 1025, 1031 (7th Cir.1998). We shall uphold summary judgment whenever "the pleadings, depositions, answers to the interrogatories, and admissions on file, together with 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). Nevertheless, "the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (emphasis in original). Ms. Eiland may avoid summary judgment by setting forth "specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e). An issue is genuine if it must be resolved at trial because the evidence, seen in the light most favorable to Ms. Eiland, would permit a reasonable factfinder to decide the issue in favor of Ms. Eiland. See Bahl v. Royal Indem. Co., 115 F.3d 1283, 1290 (7th Cir.1997). B. Disparate Treatment Claim 10 In her complaint, Ms. Eiland alleges that the hospital treated her differently and intentionally discriminated against her because of her race. She brings the same allegation under Title VII (count I) and 42 U.S.C. § 1981 (count II). Because we analyze both § 1981 and Title VII discrimination claims in the same manner, see Bratton v. Roadway Package System, Inc., 77 F.3d 168, 176 (7th Cir.1996), we shall review both of Ms. Eiland's racial discrimination claims together. According to Ms. Eiland, we can infer from the staff physician's racist actions and comments that he had a discriminatory motive in filing the incident report which led, in part, to her termination. She does not claim that the decisionmaker, Kois, was motivated by racial animus; rather, she seeks to impute the staff physician's racial animus to Kois. 11 The district court examined the staff physician's actions--the articles he had shown Ms. Eiland and the statements she considered racial slurs--and concluded that "a reasonable jury could not infer from these actions and comments alone that [the staff physician] was motivated to report Eiland because of her race." R.34 at 6. The court also determined that Ms. Eiland did not demonstrate that the doctor's statements and articles related to the incident report he filed with Kois. For that reason, it held, her disparate treatment claim failed. 12 Under § 1981, "[a]ll persons within the jurisdiction of the United States shall have the same right ... to the full and equal benefit of all laws ... as is enjoyed by white citizens." 42 U.S.C. § 1981. Under Title VII, it is unlawful for an employer "to discharge any individual ... because of such individual's race, color, religion, sex, or national origin." 42 U.S.C. § 2000e-2(a)(1). When racial discrimination is based on a claim of disparate treatment, "[p]roof of intentional discrimination is required." Gonzalez, 133 F.3d at 1031 (citing St. Mary's Honor Ctr. v. Hicks, 509 U.S. 502, 113 S.Ct. 2742, 125 L.Ed.2d 407 (1993)). An employee may demonstrate her employer's intentional discrimination by providing either direct or indirect evidence. Direct evidence is evidence which, " 'if believed by the trier of fact, will prove the particular fact in question without reliance upon inference or presumption.' " Plair v. E.J. Brach & Sons, Inc., 105 F.3d 343, 347 (7th Cir.1997) (quoting Randle v. LaSalle Telecomms., Inc., 876 F.2d 563, 569 (7th Cir.1989)). According to Ms. Eiland, the staff physician's racist comments about the articles he brought to her and his other statements that negatively referred to African Americans are direct evidence of discriminatory intent. 13 We agree with the district court that such comments do not support a direct inference that race was a determining factor in Ms. Eiland's discharge. The statements, made over time, are stray workplace remarks that will not qualify as direct evidence of discrimination unless Ms. Eiland can show that the remarks were related to the employment decision at issue, namely her termination. See Fuka v. Thomson Consumer Elecs., 82 F.3d 1397, 1403 (7th Cir.1996); Rush v. McDonald's Corp., 966 F.2d 1104, 1116 (7th Cir.1992). Ms. Eiland was unable to show this link. Moreover, when such statements are made by a nondecisionmaker, normally they cannot provide the basis for a determination of discrimination. See Wallace v. SMC Pneumatics, Inc., 103 F.3d 1394, 1400 (7th Cir.1997) (concluding that plaintiff's effort to build a prima facie case on a director's remark that "all Americans are stupid" failed because plaintiff was fired by the general manager, not the director). Ms. Eiland cannot impute the staff physician's racial animus to Kois, the decisionmaker, because she fails to relate his offensive statements to the incident report he subsequently filed with Kois or, most importantly, to Kois' subsequent decision to discharge Ms. Eiland. 14 Under the indirect approach to proving racial discrimination, Ms. Eiland was required to establish that she was in a protected class, was performing her job satisfactorily, and was fired when others outside the protected class were treated more favorably. See Gonzalez, 133 F.3d at 1032. Ms. Eiland claims that she is an African American employee with a good performance record who was fired and that no white employee had been treated as she had. She asserts that she was subjected to a very prejudiced environment and that the reason given by the hospital for her dismissal--her giving an MMR shot to a pregnant woman--was pretextual because several issues are in dispute: whether the woman was pregnant; whether Kois simply accepted the version of events given by the white doctor rather than by her, the African-American nurse; and whether the severe penalty of termination of her job was required by this incident. 15 The district court had acknowledged that Ms. Eiland disputed some of the hospital's factual assertions about the event that led to her discharge, but pointed out that she had offered no evidentiary support for her position. More importantly, she offered no evidence that the reason for the discharge was pretextual. Examining the record, the district court concluded that, because Ms. Eiland admitted in her deposition that she gave the patient the booklet about the MMR shot to read, she in effect "admitted wrongdoing in other ways by not specifically inquiring as to [the patient's] pregnancy status, not ensuring that [the patient] understood the booklet information, and not reading [the patient's] chart before treating her." R.34 at 8. The court determined that the record supported the conclusion that those admissions and the nurse's lack of remorse led to Kois' termination decision; it further held that no racial or retaliatory animus on the staff physician's part could be imputed to Kois' final decision. 16 Assuming that Ms. Eiland has succeeded in establishing her prima facie case of racial discrimination, we consider the hospital's response. It offered a legitimate, nondiscriminatory reason for firing her: Ms. Eiland was a threat to patient safety because she gave an MMR shot to a pregnant woman. The burden of proof then shifted back to Ms. Eiland to demonstrate by a preponderance of the evidence that the hospital's proffered reason was pretextual or phony. See Plair, 105 F.3d at 348; Russell v. Acme-Evans Co., 51 F.3d 64, 68 (7th Cir.1995). 17 Ms. Eiland points out the issues in dispute: whether Ms. Eiland was aware the patient was pregnant; whether the hospital records (which were not found) could support such allegations; whether Ms. Eiland had to be fired because of this incident. She accuses the decisionmaker Kois of believing the version of the events given by the white doctor--a person who had shown discriminatory animus. However, as we noted above, the staff physician's comments were stray remarks; even his alleged use of an offensive word was a single incident addressed to others, not Ms. Eiland, and it does not support a claim that he had demonstrated racial animus. See Wallace, 103 F.3d at 1400 ("If the other employee merely utters a hostile stereotype, he is not manipulating the decision."). In addition, Ms. Eiland failed to make any link between any of the staff physician's statements and her discharge.1 She offered no evidence that the staff physician had any responsibility for termination decisions or for terminating her in particular and no evidence that the staff physician was able to influence the firing decision. See Bahl v. Royal Indem. Co., 115 F.3d 1283, 1293 (7th Cir.1997). Therefore the staff physician's remarks were not actionable. 18 We also pointed out above that Kois, and not the staff physician, was Ms. Eiland's supervisor and the decisionmaker in the hospital's decision to terminate Ms. Eiland. After Kois received the incident report, she spoke with the staff physician and Ms. Eiland's immediate supervisor, Barbara Corsey. Kois then met with Ms. Eiland and asked her to explain the circumstances under which she gave the patient the MMR immunization. Only after Ms. Eiland admitted that she had not informed the patient of the dangers of the MMR shot, and only after Ms. Eiland failed to show any remorse or concern for the possible adverse health consequences for the patient or her baby did Kois decide to fire her. The record reflects that Kois acted independently and only after she evaluated the circumstances, including Ms. Eiland's version of those circumstances. There is no evidence to support the inference that Kois acted as the "cat's paw" for the staff physician. See Willis, 118 F.3d at 547; Wallace, 103 F.3d at 1400. The record simply will not support the conclusion that there is any causal connection between the staff physician's allegedly "illicit nature and the employer's ultimate decision." Willis, 118 F.3d at 547. What is crucial about Kois' decision is that she honestly believed her reasons for discharging Ms. Eiland and that she had a reasonable basis for that belief. See Bahl, 115 F.3d at 1291 ("[W]hen we consider whether an employer's justification for dismissing its employee is pretextual, the inquiry is not whether the reason for the firing was a correct business judgment but whether the decisionmakers honestly acted on that reason."). Ms. Eiland has not presented evidence that calls into question the truthfulness of Kois' honestly held reasons for her termination. See Plair, 105 F.3d at 349. Accordingly, we conclude that the district court's grant of summary judgment to the hospital on the disparate treatment claim was proper. C. Retaliation Claim 19 The retaliation provision of Title VII forbids an employer to "discriminate against any individual ... because he has made a charge ... or participated in any manner in an investigation, proceeding, or hearing under" Title VII. 42 U.S.C. § 2000e-3(a). An employee must establish a prima facie case of retaliation by showing that (1) she engaged in statutorily protected expression; (2) she suffered an adverse action; and (3) there is a causal link between the protected expression and the adverse action. See Talanda v. KFC Nat'l Mgmt. Co., 140 F.3d 1090, 1095 (7th Cir.1998) (citation omitted). Here, the hospital does not dispute that Ms. Eiland has met her burden of proving a prima facie case: She lodged a complaint against the staff physician for his racist statements on January 16 or 17, 1996; she was fired on February 19, 1996; and there is a causal link between the two events.2 However, the hospital has presented a legitimate, nondiscriminatory reason for her discharge: her improper administration of the MMR shot to a pregnant patient and her subsequent lack of remorse for the act. At this stage, Ms. Eiland has the burden of rebutting the hospital's nondiscriminatory reason for her termination by showing that the reason was pretextual and that its actual reason was discriminatory or retaliatory. See Talanda, 140 F.3d at 1096; McClendon v. Indiana Sugars, Inc., 108 F.3d 789, 797 (7th Cir.1997). Ms. Eiland's retaliation claim fails at this point, just as it did under the analysis of her disparate treatment claim. She cannot demonstrate that Kois did not honestly believe that Ms. Eiland improperly administered the MMR shot to a pregnant patient and that she lacked any feeling of remorse or concern for the patient or the unborn child. Consequently, Ms. Eiland failed to raise a genuine issue of material fact that might allow a jury to find for her on her retaliation claim.3 Conclusion 20 For the reasons discussed above, we hold that there are no genuine issues of material fact concerning Ms. Eiland's allegations of disparate treatment and retaliatory discharge. We affirm the district court's grant of summary judgment to the defendant Trinity Hospital. 21 AFFIRMED. 1 Having come to these conclusions, we believe that Ms. Eiland's reliance on Dey v. Colt Construction & Development Co., 28 F.3d 1446 (7th Cir.1994), is inapposite. Dey stated that "[s]ummary judgment generally is improper where the plaintiff can show that an employee with discriminatory animus provided factual information or other input that may have affected the adverse employment action." Id. at 1459. Ms. Eiland failed to demonstrate that the staff physician's allegedly racist comments reflected a discriminatory animus or that they tainted the decisionmaker's assessment of Ms. Eiland and affected the decisionmaker's termination decision 2 Our cases indicate that a closely related sequence of events is sufficient to present a prima facie case: The causal nexus of the third step of the prima facie case has been held to be sufficiently demonstrated when the time period between the complaint and the firing was a day or a week. See McClendon v. Indiana Sugars, Inc., 108 F.3d 789, 797 & nn. 5-6 (7th Cir.1997) (citing cases). Although we hesitate to acknowledge that the causal link was sufficiently demonstrated in this case, in light of the hospital's declining to raise the challenge to the prima facie case we shall turn to the issue of pretext 3 Ms. Eiland did not argue explicitly that her complaints about the staff physician's racist comments led to her discharge in retaliation for those complaints. We note, nevertheless, as we did in the disparate treatment analysis, that the staff physician was not the decisionmaker and that his statements thus were not probative of a decisionmaker's intent to retaliate. In addition, it is unrebutted on this record that Kois was not swayed by the hospital physician's "subjective and possibly racially biased evaluation" of Ms. Eiland. Willis v. Marion County Auditor's Office, 118 F.3d 542, 547 (7th Cir.1997). Kois, like the decisionmaker in Willis, afforded Ms. Eiland an opportunity to substantiate her claim and made her own independent evaluation. See id. at 547-48	{ "pile_set_name": "FreeLaw" }
APPLICANT PATRICK R. WARTHSAW APPLICATION NO. WRs83,461s01 APPLICATION FOR 11.07 WRIT OF HABEAS CORPUS ACTION TAKEN DENIED WITHOUT WRITTEN ORDER ON FINDINGS OF TRIAL COURT WITHOUT HEARING. JUDGE DATE	{ "pile_set_name": "FreeLaw" }
846 F.2d 75 U.S.v.Thomas (Victor Shevay), a/k/a Vic NO. 87-5587 United States Court of Appeals,Fourth Circuit. MAY 12, 1988 1 Appeal From: M.D.N.C. 2 AFFIRMED.	{ "pile_set_name": "FreeLaw" }
51 So.2d 717 (1951) GLASS et al. v. PARRISH. Supreme Court of Florida, en Banc. April 6, 1951. 718 R.F. Maguire, R.H. Wilkins and Maguire, Voorhis & Wells, all of Orlando, for appellants. Alex Akerman, Jr., Orlando, for appellee. HOBSON, Justice. This appeal is from a final judgment entered in an action for malicious prosecution which judgment was predicated upon a jury's verdict. Appellee was plaintiff below and Appellants were defendants. Appellee employed Appellants to install custom-made seat covers on her new Packard convertible automobile. The seat covers were installed and the charge made therefor was $199.50. Appellee paid the bill with a check to which she signed her mother's name. Appellants deposited the check and subsequently it was returned by the bank upon which it was drawn. The official slip had the notation "signature" and there was written in pencil upon the check the following words: "Signature not as authorized." Appellants consulted their attorney with the result that a charge of forgery was filed against Appellee. Appellants or one of them initiated the criminal action. The Justice of the Peace issued his warrant of arrest and Appellee was arrested and incarcerated in the jail at Tavares. After the preliminary hearing before the Justice of the Peace the Appellee was discharged. The Magistrate found from the evidence that "there is not sufficient cause to believe the defendant, Patricia Martin, is probably guilty of the offense with which she was heretofore charged in a warrant issued out of this Court." Shortly after the preliminary hearing Appellee instituted the present suit in and by which she sought and obtained a judgment for $2300.50. The verdict was in the amount of $2500.00 for the Appellee and $199.50 against the Appellee and in favor of the Appellants. Thus, the final judgment, as previously stated, was in the sum of $2300.50. We have held that in an action grounded upon malicious prosecution the plaintiff has the burden of proving: (1) the instigation of the criminal proceeding by the defendant; (2) its termination in favor of the plaintiff; (3) the exercise of malice by the defendant; (4) want of probable cause for the prosecution; and (5) damage. Duval Jewelry Co. v. Smith, 102 Fla. 717, 136 So. 878; Ward v. Allen, 152 Fla. 82, 11 So.2d 193. Appellants entertain the view that the Appellee failed to prove by a preponderance of the evidence: (1) the exercise of malice by the defendant and (2) want of probable cause for the prosecution. Such conclusion can be reached only upon the premise that there was no competent substantial evidence before the jury which, if believed by it, established malice and want of probable cause. After a careful study of the transcript of testimony we have reached the conclusion that there was evidence of want of probable cause, and if independent proof of malice was not clear and positive it matters not, for the jury had the right under our prior adjudications to infer malice after proof of want of probable cause. Appellants also contend that they established by uncontroverted testimony their defense of advice of counsel. The plaintiff (Appellee here) testified that the defendants (Appellants here) knew her name was Patricia Martin and that she told them she had been authorized by her mother to sign her name to checks on the mother's bank account, which she further testified she had done as a course of conduct over a period of years. Mr. Crumly confessed that he knew the Appellee both as Miss Pat Martin and Miss Patricia Martin but he and Mr. Glass denied that she advised them she was authorized to sign her mother's name to the check. Mr. Crumly, with whom the check transaction took place, attempted to explain the fact that he saw her make out the check in the name of Irene Martin by asserting that "I just assumed that Pat might be her nickname." The jury had a right to refuse 719 to accept this weak excuse, for the witness knew the Appellee's name was Patricia or Pat Martin. Although it would not have been unreasonable to presume that Pat was a nickname for Patricia, the jurors would have been credulous indeed (and this was a matter solely for the jury to conclude) had they followed the testimony to the effect that the witness assumed that Pat was a nickname for Irene. These conflicts in the testimony were resolved by the jury against Appellants and in favor of Appellee. The foregoing testimony, coupled with other evidence hereinafter detailed, when considered in the light of the evidentiary fact that the criminal prosecution was dismissed by the magistrate after the State had presented its case at the preliminary hearing and in view of the appropriate inference that the criminal prosecution had as its purpose and objective the collection, by coercion, of a civil debt, was ample predicate for the jury's conclusion that want of probable cause had been established, that appellant had not acted in good faith and that malice motivated the accusation and consequent prosecution. Furthermore, in considering the question of good faith on the part of appellants we are drawn to a study of a letter (Defendant's Exhibit 3) written to the appellee's mother (Mrs. Irene R. Martin) by the attorney for appellants which letter bears date of December 31, 1947 and to an examination of the check, which was returned by the bank on December 1, 1947 together with the bank slip attached to said check. On the back of the check is a penciled notation "Signature not as authorized" and the official bank slip gives one word only as the reason for the return of the check, to-wit: "Signature." In considering the letter written by Appellants' attorney to Mrs. Irene R. Martin the fact that the check, together with its accompanying official bank slip, was in the hands of said attorney at the time he wrote the letter and had been returned by the bank thirty days prior thereto, is significant and worthy of studied analysis. The letter reads: "Mrs. Irene R. Martin, 506 Center St., Eustis, Florida "Dear Mrs. Martin: "I have had referred to me by the Orlando Seat Cover and Supply Company, 100 West Washington St., Orlando, Florida, a certain check in the amount of $199.50, dated November 17, 1947, No. 165, drawn on the First National Bank, Eustis, Florida, and signed `Irene R. Martin'. This check was put through the usual channels and payment was refused. From the information I have received, your daughter had certain labor and materials furnished in and about a 1948 Packard convertible for seat covers, etc. "I have written your daughter, Miss Patricia Martin, about this check, since I am informed she issued it, but I am not positive whether or not you had signed the check yourself or whether your daughter signed your name as the maker. "You may have given your daughter authorization to sign your name, but if you did not, the situation poses a rather serious situation. I am somewhat reluctant to take this matter into court, but I am sure you will agree with me that the Orlando Seat & Supply Company cannot afford to lose such a sizable amount, especially since this was a rush job. "Payment must be made on this check on or before January 10, 1948, or else I will have no other recourse than to advise my client to turn this matter over to the County. "Very truly yours, "J. Walter Hall" (Italics supplied). This letter shows clearly that the attorney entertained doubt with reference to the matter of the lack of authority of the appellee to sign her mother's name to the check even after he had been employed by the appellants who through counsel in this case contend that a full disclosure of all material facts was made to their attorney when they employed him and sought his advice. The jury functioned definitely within its province and in line with well-reasoned judicial pronouncements when it concluded that the appellants, although they had grounds for suspicion, did not themselves believe that appellee had been guilty of forgery; and the jury likewise acted within the bounds of reason when it 720 refused to be lead to the conclusion that there was no agreement, understanding or funds with the bank to meet or pay said check. Good faith is always an essential element to be considered on the question of probable cause. We quote with approval from the case of Franzen v. Shenk, 192 Cal. 572, 221 P. 932, 934, wherein the Supreme Court of California said: "The rule in this behalf is stated in Fleischhauer v. Fabens, supra [8 Cal. App. 30, 96 P. 17], where it is held, in effect, that the good faith of the defendant is an essential element in the defense of probable cause; and that even though a defendant shows reasonable grounds of suspicion, sufficiently strong in themselves as to warrant a cautious man in the belief that there was probable cause for the prosecution, nevertheless, if it be apparent that he did not himself believe in the guilt of the accused, then the circumstances upon which he relied will not suffice to shield and vindicate him." The California Supreme Court also approved and quoted from Broad v. Ham, 132 English Reprints 1278, the following language: "It would be a monstrous proposition that a party who did not believe the guilt of the accused, should be said to have a reasonable and probable cause for making the charge." There is another theory upon which it is argued that the final judgment in this case should be reversed and that is the defense of advice of counsel. However, for this Court to hold a reversal in order it would be necessary to first conclude that there had been a full and complete disclosure of all the facts by the appellants, or one of them, to their attorney and that such a disclosure was established by uncontradicted evidence. If the evidence were conflicting upon the subject of full disclosure, then the jury had a right to conclude that factual issue against the defendants. As heretofore stated, appellants knew appellee as Patricia or Pat Martin and appellant Crumly who accepted the check saw appellee make out the check and observed the signature "Irene Martin." The appellee testified she advised the defendants, or one of them, that she had been authorized by her mother to sign the check and explained that she had written checks on her mother's account many times before. It is true that the defendants denied she had advised them that she was authorized to write the check on her mother's account but this conflict in the testimony was solely a matter for the jury to settle. According to the testimony, and obviously in face of the foregoing denial, neither of the defendants advised their attorney that Miss Martin had told them she was authorized to sign the check. Counsel for appellants state in their brief that "When the defendant Samuel E. Glass, Jr., called plaintiff's mother (the only person who could have given the authority to sign her name to the check) and was informed by her at that time in unequivocal language that the daughter had no authority to write the check, that the check was not hers and that she would not pay it, defendants without any further investigation, had probable cause to believe that forgery had been committed by plaintiff." (Italics supplied) The italicized portion of the foregoing quotation is not sustained by the testimony of any witness. Appellant Glass testified he told his attorney at the time he sought advice that the mother had stated the check was not authorized. Had this been true the defense of advice of counsel might have been sustained if "a full and complete disclosure" is satisfied by incorrect, misleading or untrue recitations of the facts. However, it is unnecessary to dwell at length upon what is meant by a full and complete disclosure for later in his testimony Mr. Glass contradicted himself by denying that he made such statement to his counsel and definitely admitted that the mother had not said her daughter did not have authority to sign the mother's name to the check. Actually the only information that the mother gave him in the telephone conversation which he had not possessed theretofore was that he would have to collect from her daughter for she would not pay the check. He, or his partner, had known from the beginning that the check was not her check and that was the only other statement which Glass testified the mother made to him. There was no inconsistency in her telephone conversation and the contention that she stopped 721 payment on the check and would not pay appellants because of "overcharge." It is established law in this jurisdiction that advice of counsel is a defense to an action predicated upon malicious prosecution only in event there has been a full and complete disclosure made to the attorney before his advice is given and followed. It was the jury's prerogative to, and it evidently did, determine that a full and complete disclosure of all the material facts was not made to the attorney whose advice was sought. Consequently, the defense of advice of counsel was properly rejected by the jury. It might appear harsh that the jury decided to render a comparatively large verdict against the defendants but if there was no harmful error at the trial that verdict must be sustained. However, it is not difficult to understand that the jurors who heard and observed the witnesses in the milieu of the trial court room and who live in the general community in which the parties to the suit reside, were impressed by the fact that the plaintiff, who at that time was an unmarried girl of but 17 or 18 years of age, had been greatly embarrassed and humiliated by her arrest and prosecution immediately following return from her honeymoon. If it were appropriate to speculate or conjecture, one might find the real offender to be the indulgent mother who probably laid the foundation for the regretable incident which culminated in the instant suit. We are not unaware of the fact that suits bottomed upon malicious prosecution generally find little favor with the courts. However, actions for malicious prosecution have not been out-lawed in this State and until and unless they are the rules and principles established for the orderly and fair trial of law suits must be observed by judicial tribunals. Almost every activity of ordered society must be carried on, and canalized, within the bounds of reasonable rules and regulations. Established principles of law and the rules and regulations prescribed for judicial procedure, including those which were ordained for the guidance and which define the province of courts of last resort, should not be followed in some cases but in all cases. They were not created for the purpose of being administered only upon the whim or caprice of the individual judge and they should never be regarded lightly. We have been taught to proclaim proudly that ours is a "government of laws and not of men". Deo volente may it ever remain so. This Court has repeatedly pronounced, as has almost every court in the English speaking world, the rule that it will not substitute its judgment for that of a jury when the jury has resolved the conflicts in the evidence and has determined the issues of fact. An exception to this rule exists only in a case wherein there is no competent substantial evidence which sustains the jury's verdict or, stated in another form, when the verdict is against the manifest weight of the evidence. The pronouncement of the foregoing rule is consistently made, published and republished. Regretably, at times there may have been room for the feeling that all courts have not adhered to the rule as religiously as they have proclaimed it. It is possible too that appellate courts are not entirely free from the criticism that they have fortuitously lost sight of the province of appellate courts. These courts were not established for the purpose of trying cases de novo on cold typewritten transcripts. An appellate court has the duty to consider and determine whether a case was tried in the nisi prius court under the principles, rules and regulations prescribed for its conduct. In other words, the appellate court should reverse judgments of trial courts in those cases only wherein it has been made to appear clearly that the prescribed procedure was not followed and that harmful error resulted from such obliquity. It is true that the primary objective of every court is to administer simple justice but an appellate court should not attempt to carry out this worthy purpose in complete disregard of established law, nor should it forget and step beyond its own province in order to do so. Moreover, there is no certainty, and but slight possibility, that justice will be better served by an attempt to ferret it out upon appeal, absent a definite showing of harmful and, consequently, reversible error. *722 In the case of Perez v. Rodriguez, 155 Fla. 501, 20 So.2d 654, we said: "In action for malicious prosecution, consisting in signing lunacy petition against plaintiff, issues of malice, probable cause, reliance upon advice of counsel, and damages were for jury." We approve the following quotation from the appellate court of Indiana in the case of Cleveland, C., C. & St. L. Ry. Co. v. Dixon, 51 Ind. App. 658, 96 N.E. 815, 816: "`What facts and circumstances amount to probable cause is a pure question of law. Whether they exist or not in any particular case is a pure question of fact. The former is exclusively for the court; the latter for the jury. This subject must necessarily be submitted to the jury when the facts are in controversy; the court instructing them what the law is.' Pennsylvania Company v. Weddle, 100 Ind. 138, at page 147, and authorities there cited." (Italics supplied) The many contradictions and conflicts in the testimony made this a typical jury case. The jury was entirely within its province in deciding, upon a consideration of all the testimony and circumstances surrounding the issuing of the check as it found them to be, that the appellee, who was evidently but a teen-age girl, did not unlawfully, feloniously and with intent to defraud, sign the name of another (her mother) without authority or issue a worthless check and that the appellants did not have probable cause to believe that she had done so and consequently did not act in good faith. Should we reverse the final judgment consequent upon the verdict of the jury and which had the approval of an able, veteran Circuit Judge we would be guilty of substituting our judgment for that of the jury. Such action does not square with our concept of the province of an appellate court. It should not try a case, which is before it on appeal, de novo but should confine its activities within the periphery of its own orbit. The final judgment from which this appeal was prosecuted should be and it is hereby affirmed. SEBRING, C.J., and TERRELL and THOMAS, JJ., concur. CHAPMAN, ADAMS and ROBERTS, JJ., dissent. CHAPMAN, Justice, dissents. This is an action of malicious prosecution originating in the Circuit Court of Orange County, Florida, resulting in a verdict and judgment for the plaintiff-appellee in the sum of $2,500.00. The defendants-appellants, as counterclaimants, were awarded a verdict and judgment against the plaintiff-appellee in the sum of $199.50, being the value of a set of seat covers placed by the defendants-appellants in an automobile at the request of the plaintiff below. Final judgment in the amount of $2,300.50 was entered below for plaintiff-appellee and the defendants-appellants appealed. I have carefully considered the entire record and briefs of the respective parties; and it is my view and conclusion that the plaintiff-appellee failed to show or establish malice and want of probable cause within the meaning of our adjudications. See Gainesville Gas Co. v. Walters, Fla., 37 So.2d 695, and similar cases. I think the judgment for plaintiff-appellee in the sum of $2,500.00 should be reversed and that the verdict and judgment in the sum of $199.50 awarded the defendants-appellants should be affirmed. ADAMS and ROBERTS, JJ., concur.	{ "pile_set_name": "FreeLaw" }
In the Court of Appeals Second Appellate District of Texas at Fort Worth ___________________________ No. 02-20-00182-CV ___________________________ THOMAS SATTERTHWAITE JR. AND JESSICA SHAW, Appellants V. FIRST BANK D/B/A FIRST BANK MORTGAGE AND ITS SUCCESSORS AND ASSIGNS, Appellee On Appeal from County Court at Law No. 2 Denton County, Texas Trial Court No. CV-2020-00263-JP Before Gabriel, Kerr, and Birdwell, JJ. Memorandum Opinion by Justice Gabriel MEMORANDUM OPINION Appellants Thomas Satterthwaite Jr. and Jessica Shaw attempt to appeal from the county court’s judgment of possession, which was signed on March 16, 2020. Because Appellants did not timely file their notice of appeal, we dismiss their appeal for want of jurisdiction. Appellee First Bank filed a forcible-detainer action against Appellants, asserting a superior right to possession to a home in Frisco. See Tex. Prop. Code Ann. § 24.002. On March 16, 2020, the trial court signed a judgment of possession, finding Appellants “guilty of Forcible Detainer” and ordering that First Bank have possession of the property. The trial court also ordered Appellants evicted from the property and set an “appeal bond” in the amount of “$2,750.00 per month due on the 1st day of the month.” See id. §§ 24.0061, 24.007; Tex. R. Civ. P. 510.13. Appellants filed a notice of appeal from the judgment of possession on June 16, 2020—92 days after the judgment had been signed. On July 2, we notified Appellants that because no post-judgment motion had been filed, the notice of appeal had been due no later than April 15; thus, we questioned our jurisdiction over Appellants’ attempted appeal. See Tex. R. App. P. 26.1, 42.3(a). We warned Appellants that we could dismiss their appeal if they did not respond showing grounds for our jurisdiction. See Tex. R. App. P. 44.3. Appellants responded and asserted that on June 5—81 days after the judgment of possession had been signed—they had filed an “emergency motion on the writ of possession” and 2 that the trial court had ruled that they “had until June 15, 2020 at 5:00 p.m. to provide documentation showing the perfection of an appeal.” Appellants contend that they believed this acted as an extension of the appellate deadline. An extension of time to file a notice of appeal may only be granted by this court, not the county court, and must be sought within 45 days of the date of the judgment if no timely post-judgment motion is filed. See Tex. R. App. P. 3.1(b), 26.1(a), 26.3; In re J.A., 53 S.W.3d 869, 872 (Tex. App.—Dallas 2001, no pet.). See generally Verburgt v. Dorner, 959 S.W.2d 615, 617 (Tex. 1997) (“[O]nce the period for granting a motion for extension of time under Rule [26.3] has passed, a party can no longer invoke the appellate court’s jurisdiction.”). Even if Appellants’ emergency motion regarding the writ of possession were considered to be a post-judgment motion, it was filed more than 30 days after the trial court signed the judgment of possession; thus, the emergency motion did not operate to extend the notice-of- appeal deadline. See Tex. R. App. P. 26.1(a); Tex. R. Civ. P. 329b(a). Accordingly, Appellants did not file an effective post-judgment motion, extending the appellate deadline, nor did they file their notice of appeal or an equivalent filing within 30 days of the trial court’s judgment of possession. Absent these actions, we do not have jurisdiction over Appellants’ appeal and we dismiss it.1 See Tex. R. App. P. 43.2(f); 1 We recognize that the Texas Supreme Court has issued an emergency order regarding the COVID-19 state of disaster that extends filing and service deadlines falling between March 13, 2020, and June 1, 2020. However, this order specifies that the extension “does not include deadlines for perfecting appeal.” Tex. Sup. Ct., Misc. 3 Webb-Goodwin v. Trails of White Rock, No. 05-18-00145-CV, 2018 WL 1281305, at *1 (Tex. App.—Dallas Mar. 13, 2018, no pet.) (mem. op.). /s/ Lee Gabriel Lee Gabriel Justice Delivered: July 30, 2020 Docket No. 20-9059 (Apr. 27, 2020); see also Tex. Sup. Ct., Misc. Docket No. 20-9071 (May 26, 2020) (renewing April 27, 2020 emergency order regarding extensions). 4	{ "pile_set_name": "FreeLaw" }
United States Court of Appeals For the First Circuit No. 01-1542 ELIZABETH V. BOGOSIAN, Plaintiff-Appellant/Cross-Appellee, v. WOLOOHOJIAN REALTY CORPORATION, Defendant-Appellee/Cross-Appellant, JAMES E. WOLOOHOJIAN, HARRY J. WOLOOHOJIAN, PEZZUCO CONSTRUCTION CO., INC., CUMMINGS & LOCKWOOD, AND TILLINGHAST, LICHT & SEMONOFF, ET AL., Appellees. No. 02-1196 ELIZABETH V. BOGOSIAN, Plaintiff-Appellant/Cross-Appellee, v. WOLOOHOJIAN REALTY CORPORATION, Defendant-Appellee/Cross-Appellant, JAMES E. WOLOOHOJIAN, HARRY J. WOLOOHOJIAN, PEZZUCO CONSTRUCTION CO., INC., CUMMINGS & LOCKWOOD, AND TILLINGHAST, LICHT & SEMONOFF, ET AL., Appellees. 02-1235 ELIZABETH V. BOGOSIAN, Plaintiff-Appellant/Cross-Appellee, v. WOLOOHOJIAN REALTY CORPORATION, Defendant-Appellee/Cross-Appellant, JAMES E. WOLOOHOJIAN, HARRY J. WOLOOHOJIAN, PEZZUCO CONSTRUCTION CO., INC., CUMMINGS & LOCKWOOD, AND TILLINGHAST, LICHT & SEMONOFF, ET AL., Appellees. ERRATA SHEET The opinion of this court issued March 19, 2003, should be amended as follows: On page 12, line 22, "note 3" should be "note 4." 2	{ "pile_set_name": "FreeLaw" }
504 F.2d 760 Avemco Insurance Companyv.Rollins 74-2289 UNITED STATES COURT OF APPEALS Fifth Circuit 11/19/74 N.D.Ga., 500 F.2d 1182	{ "pile_set_name": "FreeLaw" }
813 F.Supp.2d 1005 (2011) Natalie VAN STRAATEN, Plaintiff, v. SHELL OIL PRODUCTS COMPANY LLC, Equilon Enterprises LLC, and Shell Oil Company, Defendants. No. 09 C 1188. United States District Court, N.D. Illinois, Eastern Division. September 26, 2011. Statement Granting Motion for Certification of Appealability December 8, 2011. 1007 John R. Wylie, Donaldson & Guin LLC, Martin Jay Oberman, Chicago, IL, for Plaintiff. Ray G. Rezner, Rachael M. Trummel, Sarah B. Waxman, Shermin Kruse, Barack 1008 Ferrazzano Kirschbaum & Nagelberg LLP, Chicago, IL, for Defendants. MEMORANDUM AND ORDER BLANCHE M. MANNING, District Judge. In 1950, Diners Club issued its first credit cards, crafted from cardboard, so diners could charge meals in 27 restaurants in New York City. One year later, nearly 20,000 Americans had a Diners Club card. In 1958, American Express and BankAmericard (now Visa) created credit cards that rapidly gained acceptance as the words "charge it!" became part of the American lexicon. See M.J. Stephey, A Brief History of: Credit Cards, TIME, Apr. 2009, available at http://www.time. com/time/magazine/article/0,9171,1893507, 00.html (last visited Sept. 26, 2011). The ease and convenience of signing for purchases made on credit, however, had negative repercussions that likely were not contemplated back in the 1950s. Specifically, after credit card identity theft based on misappropriated credit card information became an unfortunate reality for many Americans, the Fair and Accurate Credit Transactions Act ("FACTA"), 15 U.S.C. § 1681c(g), was enacted. Among other things, FACTA prohibits merchants from printing the expiration date or more than the last five digits of a credit or debit card number on electronically printed receipts provided at the point of sale. In this case, plaintiff Natalie Van Straaten seeks to represent a class of consumers who used Shell's proprietary credit and debit cards at Shell gas stations. Ms. Van Straaten contends that Shell Oil Products Company, Equilon, and Shell Oil (collectively Shell) improperly truncated the digits on Shell's payment cards by masking the wrong digits on the receipt. Shell's motion for summary judgment is before the court. For the following reasons, Shell's motion is denied. I. Background The following facts are undisputed unless otherwise noted. A. The Magnetic Stripe Credit and debit card transactions are overwhelmingly processed electronically. Electronic processing uses electronically encrypted data in the magnetic stripe on the back of a payment card, as opposed to the numbers that are embossed on the front of the card. International standards promulgated by the International Organization for Standardization and the International Electrotechnical Commission govern, among other things, the data contained in the magnetic stripe. The information in the magnetic stripe allows electronic point of sale terminals to read data and process transactions after a card is swiped. Thus, when a consumer uses a card, the data in the magnetic stripe is transmitted to an intermediate institution and then to the cardholder's bank, after which an electronic signal approving or rejecting the transaction is sent back to the merchant's point of sale terminal. International standards mandate that every payment card's magnetic stripe must contain a series of digits called the primary account number, or PAN. The PAN consists of account and other numbers that are prescribed by international standards and recognized throughout the payment card industry. It consists of a maximum of 19 digits, and includes digits identifying the industry associated with the card, the card holder, and the card issuer. The following diagram illustrates the composition of the PAN: 1009 ISO/IEC standard 7812-1, attached as Ex. C to the plaintiff's statement of facts. For example, the PAN for a financial institution card such as Visa or MasterCard starts with a 5, a travel and entertainment card such as American Express starts with a 3, and a petroleum industry card starts with a 7. The PAN also contains digits constituting the "individual account identification" for the card holder. Next, the PAN contains a "check digit" that acts as an anti-fraud measure and is a number derived from an algorithm known as the "Luhn formula." See Joe Celko, Joe Celko's Thinking in Sets: Auxiliary, Temporal, and Virtual Tables in SQL § 8.3.3 (2008). The PAN may also include digits indicating the specific card issued to an account that has multiple cards (ex: Jane and John Doe's cards associated with their joint account may contain digits that indicate whether the card is Jane's or John's). B. Numbers Embossed on the Front of a Payment Card Because digits embossed on the front of a payment card are irrelevant to electronic processing, which relies on the data in the magnetic stripe, there are no international standards governing which numbers should be embossed onto the front of a payment card. As a general rule, the numbers embossed on the front of the card correspond to data in the magnetic stripe, as none of the data in the stripe (the PAN and other information) is visible to the naked eye. Each type of card (Visa, MasterCard, etc.) has all or a part of the PAN embossed onto the front of the card. To the extent that PAN digits are omitted from the front of a card, those omitted digits are not at the end of the PAN. To illustrate, assume that the PAN for hypothetical payment card Z contains 18 digits. The front of that card has the last 15 of those digits embossed on its face, which means that the last five digits of the PAN and the last five digits on the front of the payment card are identical: PAN = 1 2 3 4 5 6 7 8 9 A B C D E F G H I Face of the card = 4 5 6 7 8 9 A B C D E F G H I C. Shell Payment Cards With respect to Shell payment cards, the system governing the arrangement and labeling of the numbers embossed on the front was designed more than 50 years ago by a Shell employee whose name has been lost to the ages. The numbers embossed on the front are taken from the PAN. The digits are arranged in two groups labeled "account number" (on the left) and "card number" (on the right): 1010 Dkt. No. 85, Page ID# 536. Each number has a designated significance. The method Shell used to select the digits comprising Shell's so-called "card number" causes many of its payment cards to have the same digits in the area of the card designated as the "card number." According to Shell, this duplication (as opposed to the more unique sequence of digits in the "account number" section of a Shell payment card) makes it difficult for a merchant to use digits from Shell's "card number" to cross-reference receipts and other documents when performing returns, refunds, and chargebacks. D. Electronically Printed Receipts and Masking 1. Pre-FACTA The software controlling electronic processing of credit and debit card transactions dictates which PAN digits will be printed on the receipt. When electronic processing started, receipts contained the entire PAN, the card's expiration date, and the cardholder's name. This made things easy for identity thieves. To combat the growing problem of identify theft, Visa, by contract with its merchants, began to require the software to mask all but the last four digits of the PAN. Turning back to hypothetical payment card Z, which has an 18-digit PAN with the last 15 digits of the PAN embossed on its face, the PAN, face of the card, and the electronically printed receipt issued following Visa's protocol are as follows: PAN = 1 2 3 4 5 6 7 8 9 A B C D E F G H I Face of the card = 4 5 6 7 8 9 A B C D E F G H I Receipt = X X X X X X X X X X X F G H I Due to Visa's size, its PAN masking protocol became the unofficial standard. In the meantime, states passed their own masking statutes to fight identity theft. These statutes often contained inconsistent terms. Eventually, Congress enacted FACTA in an effort to wipe out the patchwork of conflicting state laws and protect consumer credit information. 2. FACTA The masking provisions in FACTA provide that: (g) Truncation of credit card and debit card numbers (1) In general Except as otherwise provided in this subsection, no person that accepts credit cards or debit cards for the transaction of business shall print more than the last 5 digits of 1011 the card number or the expiration date upon any receipt provided to the cardholder at the point of the sale or transaction. (2) Limitation This subsection shall apply only to receipts that are electronically printed, and shall not apply to transactions in which the sole means of recording a credit card or debit card account number is by handwriting or by an imprint or copy of the card. 15 U.S.C.A. § 1681c(g) (emphasis added). 3. Shell's Masking Protocol Shell designed its masking protocol before FACTA's enactment. After FACTA was enacted, Shell employees who are not attorneys analyzed the statute and related materials and decided that Shell's pre-FACTA masking protocol complied with FACTA. Under Shell's masking protocol, every digit embossed on the face of a payment card (which, the reader will recall, is a subset of the numbers comprising the PAN) is masked except the last 4 digits of what Shell calls the "account number," which is the first group of numbers embossed on the front of a Shell payment card. Thus, an electronically processed receipt from a purchase made with a Shell payment card looks like this: XXX XX1234 XXXXX ACCOUNT CARD NUMBER NUMBER Exp Date: XXX Ms. Van Straaten contends that Shell is masking the wrong numbers because the relevant numbers on a Shell card under FACTA consist of the entire sequence of digits on the front of a Shell's payment card, which corresponds with the PAN. Ms. Van Straaten then asserts that FACTA requires Shell to mask all of the numbers embossed on the front of the card except up to five digits at the end of the entire sequence of numbers on the front of the card. Under this interpretation of FACTA, an electronically processed receipt from a purchase made with a Shell payment card would look like this: XXX XXX XXX 12345 ACCOUNT CARD NUMBER NUMBER Exp Date: XXX II. Discussion A. Standard for A Motion For Summary Judgment Summary judgment is proper "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); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). "The evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor." Valenti v. Qualex, Inc., 970 F.2d 363, 365 (7th Cir.1992). A court should grant a motion for summary judgment only when the record shows that a reasonable jury could not find for the nonmoving party. Id. To successfully oppose a motion for summary judgment, however, the non-moving party must do more than raise a "metaphysical doubt" as to the material facts. Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). Instead, it must demonstrate that a genuine issue of fact exists. See id. at 587, 106 S.Ct. 1348; see also Fed.R.Civ.P. 56(e) ("If a party fails to properly support an assertion of fact or fails to properly address another party's assertion of fact" the court may: "(1) give an opportunity to properly support or address the fact; (2) consider the fact undisputed for purposes of the motion; (3) grant summary judgment if the motion and supporting materialsincluding the facts considered undisputed 1012 show that the movant is entitled to it; or (4) issue any other appropriate order"). B. Shell's Masking Protocol This case turns on the meaning of the words "card number." 15 U.S.C.A. § 1681c(g)(1) ("Except as otherwise provided in this subsection, no person that accepts credit cards or debit cards for the transaction of business shall print more than the last 5 digits of the card number"). However, Congress did not provide a definition of "card number." It is well established that a statute's plain language is "the best indication of Congressional intent." Rodas v. Seidlin, No. 09-3760, 656 F.3d 610, 617 (7th Cir.2011); O'Kane v. Apfel, 224 F.3d 686, 688 (7th Cir.2000) ("When interpreting congressional statutes, we first look at the plain language of the statute because that is the best way to determine congressional intent"). In addition, a court must give the words chosen by Congress their "most natural reading." See McNeil v. United States, 508 U.S. 106, 112, 113 S.Ct. 1980, 124 L.Ed.2d 21 (1993); see also Smith v. City of Jackson, Mississippi, 544 U.S. 228, 249, 125 S.Ct. 1536, 161 L.Ed.2d 410 (2005) (discussing the plain language of a statute in terms of its "natural reading"); Commodity Trend Service, Inc. v. Commodity Futures Trading Com'n, 233 F.3d 981, 989 (7th Cir.2000) ("The [Act] does not define client, so we assume that Congress intended the word to have its ordinary meaning"). As the reader will recall, Shell's credit card layout and masking protocol is unique since it divides the numbers embossed on the front of the card into two groups, which it names the "account number" and the "card number." Shell masks all digits except the last four digits of the "account number." In contrast, payment cards such as Visa and Mastercard have a single series of numbers embossed on the front, and mask all digits except the last four. Ms. Van Straaten argues that Shell must work backwards from all of the numbers on the front of a Shell payment card (i.e., a sequence consisting of Shell's so-called "account number" plus Shell's so-called "card number"). Under this world view, Shell would mask all digits except the last four digits of all of the numbers embossed on the front of the card. These last four numbers are the same as the last four digits of the PAN that is encrypted on the back of the card. In contrast, Shell asserts that its so-called "account number" embossed on the front of its payment cards is the same thing as FACTA's "card number." It thus contends its practice of masking of all digits except the last four digits of its so-called "account number" complies with FACTA, even though Shell's "account number" digits are neither at the end of the entire sequence of numbers embossed on the front of a Shell card nor the same as the last four digits of the PAN encrypted on the back. The court is unpersuaded by Shell's interpretation of the words "card number." First, the most natural definition of "card number" as those words are used in FACTA is "all of the numbers on the front of a card." A consumer purchasing a product on-line, when asked to input her card number, types in all of the numbers on the front of the card. If she only typed in a portion of the number, such as the digits corresponding to Shell's so-called "account number" (which Shell asserts is identical to the "card number" in FACTA), the transaction would be rejected. Furthermore, a common sense understanding of payment cards is that information encrypted on the back of a payment card corresponds to the numbers on the front. See Gil v. Reed, 381 F.3d 649, 662 1013 (7th Cir.2004) (the court "need not check [its] common sense at the door"). It is likely that anyone who uses payment cards has experienced the phenomena of the swipe that does not work, leading to the manual entry of the numbers on a card's front into a terminal. Once these numbers are entered, the transaction is processed and an electronic receipt is generated. The person manually entering the numbers does not type in a portion of the numbers on the front; she types in the entire sequence. The court thus concludes that the phrase "card number" most naturally refers to the entire sequence of numbers on the front of the card, which corresponds (as described above) to the PAN encrypted on the back. Moreover, "[s]tatutory language only has meaning in context." Shlahtichman v. 1-800 Contacts, Inc., 615 F.3d 794, 802 (7th Cir.2010), quoting Graham County Soil & Water Conservation Dist. v. United States ex rel. Wilson, 545 U.S. 409, 415, 125 S.Ct. 2444, 162 L.Ed.2d 390 (2005). FACTA was enacted to, among other things, safeguard against identity theft. See id. at 802, quoting Pub.L. 108-159, 117 Stat. 1952 (Dec. 4, 2003) (describing FACTA as "[a]n [a]ct [t]o amend the Fair Credit Reporting Act, to prevent identity theft, improve resolution of consumer disputes, improve the accuracy of consumer records, make improvements in the use of, and consumer access to, credit information, and for other purposes"). To achieve this purpose, Congress chose to focus on electronically printed receipts. See 15 U.S.C.A. § 1681c(g)(2) ("This subsection shall apply only to receipts that are electronically printed, and shall not apply to transactions in which the sole means of recording a credit card or debit card account number is by handwriting or by an imprint or copy of the card"). As noted above, the PAN corresponds to the numbers embossed on the front of a payment card. The PAN is encrypted onto the magnetic stripe on a payment card and is an essential part of the creation of electronically printed receipts. Indeed, international standards require the magnetic stripe to contain the PAN. Because FACTA only applies to electronically printed receipts and international standards require the magnetic stripe to contain the PAN, the phrase "the last 5 digits of the card number" necessarily must refer to the last five digits that can be read electronically. To hold otherwise would require the court to ignore Congress' expressed intent to regulate receipts produced electronically since swiped payment cards read the magnetic stripe, not the numbers on the face of a card. See Commodity Trend Service, Inc. v. Commodity Futures Trading Com'n, 233 F.3d 981, 989 (7th Cir.2000) (generally, "all words in a statute should, if possible, be given effect"). Similarly, the court must "avoid interpreting a statute in a way that renders a word or phrase redundant or meaningless." United States v. Berkos, 543 F.3d 392, 396 (7th Cir.2008). Congress did not authorize the printing of up to five digits of any portion of the card number. Instead, it specifically chose to adopt a uniform system based on printing of "the last 5 digits of the card number." 15 U.S.C.A. § 1681c(g)(1) (emphasis added). "Dictionaries are a helpful resource in ascertaining the common meaning of terms that a statute leaves undefined." Shlahtichman v. 1-800 Contacts, Inc., 615 F.3d at 799. "Last," instead, means "[f]ollowing all others; coming at the end." "Last, adj. (and n.) and adv." The Oxford English Dictionary (2d ed. 1989). Thus, a merchant may not, at its discretion, choose a subset of the numbers on the front of the card (which as noted above correspond to information encrypted on the back of the card) and then 1014 print up to the last five digits of that chosen sequence. See generally Sobitan v. Glud, 589 F.3d 379, 386 (7th Cir.2009) (rejecting party's interpretation of a statute because it would render words in the statute "superfluous, a result we try to avoid"). This conclusion is further supported by the fact that the existence of a patchwork of inconsistent masking protocols and the resulting potential for identify theft led to the enactment of FACTA. See Pub. L. No. 108-159, 117 Stat. 1952 (Dec. 4, 2003) (FACTA was enacted to provide a uniform standard, preempting all state laws, to "prevent identity theft"). The court declines to accept Shell's contention that FACTA permits it to mask numbers at the end of one of two sequences it has chosen to emboss on the front of Shell cards, as allowing a card issuer to choose the digits to mask would subvert the intent of Congress to provide a national standard. See id.; see also Creative Hospitality Ventures, Inc. v. U.S. Liability Ins. Co., 655 F.Supp.2d 1316, 1333 (S.D.Fla.2009) (collecting authority concluding that FACTA was meant to address the "national concern" of identify theft). Shell also appears to be contending that because it chose to call a series of numbers on the front of the card the "account number," it can disclose up to five digits of that series of numbers. This argument is based on Shell's position that its "account number" is the same as FACTA's "card number." The court has already rejected this idiosyncratic interpretation of the words "card number." Shell next notes that the terms "card number" and "account number" are generally used interchangeably in the payment card industry. It then concludes that its practice of printing the last four digits of its "account number" complies with FACTA because "card number" and "account number" are the same thing. The court disagrees. For virtually all payment cards other than Shell cards, the terms "card number" and "account number" refer to the same series of numbers. Thus, they can be used interchangeably because regardless of what the series of numbers is called, the contents of the series remain the same. In contrast, Shell's focus on its so-called "account number," which is a sub-set of the "card number" as that term is used in FACTA, means it is an outlier. Since Shell chose not to follow the otherwise uniform industry standard when designing its payment cards and masking protocol, its current predicament is of its own making. It cannot, therefore, find refuge in the general interchangeability of the terms "card number" and "account number." In addition, Shell argues that its so-called "account number" is the same as FACTA's "card number" because if FACTA's "card number" refers to a sequence of numbers contained in the PAN, a Shell card user would be unable to ascertain if Shell had complied with FACTA's masking protocol by looking at a receipt since the PAN can only be read electronically. This is unpersuasive; Shell chose to selectively place and group certain numbers on the front of its payment cards. To the extent that its protocol does not allow consumers to ascertain if a merchant properly masked "the last 5 digits of the card number," 15 U.S.C.A. § 1681c(g)(1), Shell is responsible and cannot use its own chosen protocol to support its interpretation of FACTA. Finally, Shell notes that the method used to select the digits comprising the "card number" section on a Shell payment card (i.e., the second group of numbers on the front of a Shell card) causes many Shell payment cards to share the same Shell "card number." According to Shell, this duplication makes it difficult for a merchant to use digits from the Shell 1015 "card number" to cross-reference receipts and other documents when performing returns, refunds, and chargebacks. This concern is at odds with FACTA, which allows merchants to choose between electronically printing the expiration date or up to the last five digits of the card number. 15 U.S.C.A. § 1681c(g). Congress thus explicitly allows merchants to print the month-year expiration date of a payment card (MM-YY or MM-YYYY) on an electronically produced receipt instead of up to five digits of the card number. The expiration date digits are far less distinctive than the last five digits of Shell's "card number" because a significant number of payment cards have an identical expiration date. Thus, the information on receipts associated with cards expiring in the same year would be identical. In contrast, the last five digits of FACTA's "card number" are more distinctive. In sum, "[w]hen the statute's language is plain, the sole function of the courtsat least where the disposition required by the text is not absurdis to enforce it according to its terms." Lamie v. United States Trustee, 540 U.S. 526, 534, 124 S.Ct. 1023, 157 L.Ed.2d 1024 (2004) (internal quotations and citations omitted). Following the enactment of FACTA, Shell chose to keep its pre-FACTA card number arrangement scheme and elected to continue to mask based on the "account number" digits on the front of Shell payment cards. For the reasons discussed above, the court finds that this masking system fails to comply with FACTA. C. Constitutionality of FACTA Shell contends that if its interpretation of FACTA is wrong, then FACTA's masking provisions are unconstitutionally vague because they fail to give fair warning of what is prohibited. Ms. Van Straaten did not respond to this argument, but the court declines to strike down a provision in a federal statute as unconstitutional based on forfeiture. A law is void for vagueness if it "fails to give fair warning of what is prohibited, if it fails to provide explicit standards for the persons responsible for enforcement and thus creates a risk of discriminatory enforcement, and if its lack of clarity chills lawful behavior." Anderson v. Milwaukee County, 433 F.3d 975, 978 (7th Cir.2006); see also Coe v. Cook County, 162 F.3d 491, 496 (7th Cir.1998) ("[s]tatutes and other enactments present a constitutional issue of vagueness when they deter constitutionally protected activity, fail to provide even minimum guidance as to people's legal obligations, or give law enforcers excessive discretion that might be exercised in arbitrary or invidious ways"). If a statute regulates economic activity, it "is subject to a less strict vagueness test [than criminal statutes] because its subject matter is often more narrow, and because businesses, which face economic demands to plan behavior carefully, can be expected to consult relevant legislation in advance of action." Iosello v. Leiblys, Inc., 502 F.Supp.2d 782, 785 (N.D.Ill. 2007), quoting Village of Hoffman Estates v. Flipside, Hoffman Estates, Inc., 455 U.S. 489, 498, 102 S.Ct. 1186, 71 L.Ed.2d 362 (1982). The court must thus consider whether FACTA's masking provisions are "sufficiently clear that [their] prohibitions would be understood by an ordinary person operating a profit-driven business." Id. Numerous defendants who provided electronic receipts with the last four or five digits of a card number and the expiration date have unsuccessfully argued that FACTA's masking protocol is ambiguous. See, e.g., Ramirez v. Midwest Airlines, Inc., 537 F.Supp.2d 1161, 1171 1016 (D.Kan.2008) (collecting cases). Similarly, defendants have unsuccessfully argued that the prohibition against printing more than the last 5-digits or expiration date rule is unconstitutionally vague. See id. at 1172 (rejecting claim by defendant who printed last four digits and the expiration date); Follman v. Village Squire, Inc., 542 F.Supp.2d 816, 820-21 (N.D.Ill.2007) (collecting cases). Merchants have also unsuccessfully tried to escape FACTA liability by contending that FACTA's statutory damages provision is unconstitutionally vague because it authorizes an award of damages ranging from $100.00 to $1,000.00 but does not specify criteria for assessing the amount of damages within that range. See, e.g., Harris v. Mexican Specialty Foods, Inc., 564 F.3d 1301, 1311-12 (11th Cir.2009). Shell, however, appears to be the first card issuer to contend that the phrase "the last 5 digits of the card number," 15 U.S.C.A. § 1681c(g)(1), is unconstitutionally vague. As noted above, Shell's problems flow from its decision to emboss a subset of the PAN on the front of Shell payment cards as the so-called "account number" and then mask everything except the last four digits of that "account number." As discussed above, however, the court declines to find that FACTA, which was enacted to ensure that sensitive, private consumer information would be handled uniformly, permits merchants to select their own series of numbers to disclose. Without meaning to impugn the Shell employees responsible for Shell's masking policy, a person of common intelligence would grasp this and would not have chosen to eschew the otherwise universally accepted practice of having the numbers on the front of a card correspond to the PAN encrypted on the back and disclosing the numbers at the end of this sequence of numbers as opposed to a self-selected subset of those numbers. The court thus declines to strike down § 1681c(g) as unconstitutionally vague. D. Willfullness Ms. Van Straaten concedes that Shell's masking protocol has not caused her to incur any damages. Indeed she apparently continues to use her Shell payment card. Nevertheless, she seeks damages under 15 U.S.C. § 1681n(a)(1)(A), which allows actual damages or statutory damages of at least $100 but no more than $1,000 per occurrence. See 15 U.S.C. § 1681n(a)(1)(A) ("Any person who willfully fails to comply with any requirement imposed under this title with respect to any consumer is liable to that consumer in an amount equal to the sum of (1)(A) any actual damages sustained by the consumer as a result of the failure or damages of not less than $100 and not more than $1,000"). Given the number of Shell payment cards in existence, even the low end of this range would be an extremely large number if this case were to proceed as a class action. If Shell's conduct is willful, it may also be liable for Ms. Van Straaten's costs and attorney's fees as well as punitive damages. See 15 U.S.C. § 1681n(a)(2)(3). In contrast, if Shell's conduct is negligent as opposed to willful, Shell may be liable only for actual damages, costs, and attorney's fees. See 15 U.S.C. § 1681o (a)(1)-(2). A willful violation of FACTA can be either knowing or reckless. See Safeco Ins. Co. v. Burr, 551 U.S. 47, 57, 127 S.Ct. 2201, 167 L.Ed.2d 1045 (2007). According to the Supreme Court, the Restatement (Second) of Torts is helpful in understanding what conduct is "reckless": The actor's conduct is in reckless disregard of the safety of another if he does an act or intentionally fails to do an act which it is his duty to the other to do, knowing or having reason to know of facts which would lead a reasonable man 1017 to realize, not only that his conduct creates an unreasonable risk of physical harm to another, but also that such risk is substantially greater than that which is necessary to make his conduct negligent. Id. at 69, 127 S.Ct. 2201, citing Restatement (Second) of Torts § 500 (1963-64). Shell's decision to challenge the constitutionality of FACTA's masking provisions led to the court's finding that FACTA's reference to "the last five digits of the card number," 15 U.S.C. § 1681c(g), is "sufficiently clear that its prohibitions would be understood by an ordinary person operating a profit-driven business," Iosello v. Leiblys, Inc., 502 F.Supp.2d at 785. This does not, however, necessarily mean that Shell's conduct was willful. The court thus considers whether Shell is entitled to summary judgment in its favor as to willfulness. Shell first contends that its conduct was not willful because no court has issued a decision stating that Shell's specific masking protocol violates FACTA. In support it directs the court's attention to Shlahtichman v. 1-800 Contacts, Inc., a recent Seventh Circuit decision holding that a defendant's masking protocol was not willful because "[t]o date, there has been no contrary opinion from a court of appeals or federal agency suggesting that the company's understanding of the statute is wrong." 615 F.3d at 794. In Shlahtichman, the Seventh Circuit went on to note that "even if its construction of the statute turns out to be mistaken, it is objectively reasonable nonetheless for all of the reasons we have discussed" so the defendant's inclusion of information prohibited by FACTA in an email receipt was not reckless. Id. Critically, in Shlahtichman, the Seventh Circuit found that the defendant's interpretation of the statutory language at issue was objectively reasonable because the court agreed with that interpretation. In contrast, in this case the court did not find that Shell's conduct was objectively reasonable as it concluded that Shell's masking protocol violates FACTA. Moreover, the court declines to adopt a FACTA version of the age old proverb "every dog is allowed one bite" as the mere absence of authority contrary to Shell's position does not mean that as the first company to adopt this position, it gets an automatic free pass. See generally OXFORD DICTIONARY OF PROVERBS, at 79 (Jennifer Speake ed. 2003) ("The proverb [every dog is allowed one bite] is based on the old common law rule (dating at least from the seventeenth century) by which the keeper of a domestic animal was not liable for harm done by it unless he knew of its vicious propensities"). The court thus turns to the evidence presented by the parties that purportedly demonstrates that Shell was/was not willful. It is undisputed that Shell knew about FACTA's truncation requirements and decided (erroneously, as discussed above) that its protocol complied with FACTA. At Shell, Frankie McCuller, Shell's Rule 30(b)(6) witness, and two of her co-employees, Mike Iribarren and Elwood Holmes, were responsible for ensuring compliance with state truncation laws, and Ms. McCuller was responsible for deciding the truncation protocol used by Shell's software. None of these employees are lawyers. Ms. McCuller is thus Shell's key witness regarding wilfulness as Shell did not involve lawyers in its decisions about FACTA truncation and, in any event, the court previously held that Shell could not rely on an "advice of counsel" defense because it claimed during discovery that information about its communications with counsel were privileged. See Docket No. 71. 1018 Ms. McCuller received communications stating that FACTA required merchants to mask digits at the end of the PAN. She nevertheless reviewed FACTA and decided that Shell's masking software, which masked digits from the "account number" section embossed on the front of the Shell cards, complied with it. Ms. Van Straaten characterizes this decision as reckless, especially given that Ms. McCuller is not an attorney. Shell, on the other hand, decries this position as "elitist" and contends that the facts surrounding Ms. McCullen's decision including her review of documents that allegedly support her interpretation of FACTAshow that she was an experienced employee who made considered, educated decisions within her scope of expertise. This court declines to determine, as a matter of law based on the current record, whether Shell's conduct was reckless. This issue is a question of fact that must be considered by a jury. III. Conclusion For the above reasons, Shell's motion for summary judgment [84] is denied. In addition, Ms. Van Straaten's motions for leave to file a sur-reply [111] and supplemental authority [147] are granted. A joint status report summarizing the dates set by the magistrate judge for remaining pretrial matters and the parties' views regarding what further proceedings are necessary shall be filed by October 18, 2011. This matter is set for status on October 20, 2011, at 11:00 a.m. STATEMENT In this case, plaintiff Natalie Van Straaten seeks to represent a class of consumers who used Shell's proprietary credit and debit cards at Shell gas stations. Ms. Van Straaten contends that Shell Oil Products Company, Equilon, and Shell Oil (collectively Shell) improperly truncated the digits on Shell's payment cards by masking the wrong digits on the receipt. The court recently denied Shell's motion for summary judgment. Shell's motion to certify under § 1292(b) or, alternatively, to reconsider [161] followed. Plaintiff Natalie van Straaten has also filed a motion for leave to file supplemental materials in opposition to Shell's motion [171] and a motion to certify a class [166]. Section 1292(b) provides, in pertinent part, that "[w]hen a district judge, in making in a civil action an order not otherwise appealable under this section, shall be of the opinion that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation, [s]he shall so state in writing in such order." Shell asks the court to certify the following two questions for interlocutory appeal: (1) Whether Shell's interpretation of the phrase "card number" in FACTA and its resulting truncation protocol, even if wrong, could be reckless as a matter of law? (2) Whether the undefined term "card number," as used in FACTA, refers exclusively to the card's "Primary Account Number" ("PAN") even though there is no reference to "PAN" in the statute or legislative history? Dkt. 161, Page ID # 2276; Dkt. 162, Page ID # 2279. Alternatively, it asks the court to reconsider its ruling that Shell is not entitled to summary judgment on the question of willfulness. The court begins by noting that it disagrees with Shells' characterization of the reasoning and holding in the summary judgment order sought to be appealed. For example, the court did not hold that "card number" equals 100% of the PAN. Instead, it analyzed the truncation requirements in FACTA and reached a conclusion about which digits must be truncated. 1019 The court also finds that Shell's questions are excessively adversarial and fail to fairly express the legal issues at the heart of this case. This is immaterial, however, as § 1292(b) provides for certification of orders for appeal, not questions. Edwardsville Nat'l Bank & Trust Co. v. Marion Labs., Inc., 808 F.2d 648, 650 (7th Cir. 1987) ("The question is the reason for the interlocutory appeal, but the thing under review is the order") (emphasis in original); see also 28 U.S.C. § 1292(b) (referencing "an immediate appeal from the order"); Rodgers v. Allen, No. 05 C 3540, 2009 WL 2872912, at 2 (N.D.Ill. Sept. 2, 2009) (collecting cases). The court thus turns to the § 1292(b) factors. A petition for interlocutory appeal must be filed with the district court within a reasonable time after entry of the order sought to be appealed. Ahrenholz v. Board of Trustees of Univ. of Ill., 219 F.3d 674, 676 (7th Cir.2000). Moreover, the movant must satisfy "four statutory criteria.... there must be a question of law, it must be controlling, it must be contestable, and its resolution must promise to speed up the litigation." Id. at 675 (emphasis in original). Finally, interlocutory appeals under § 1292(b) are disfavored so certification is appropriate only in exceptional cases. See, e.g., Coopers & Lybrand v. Livesay, 437 U.S. 463, 473-74, 98 S.Ct. 2454, 57 L.Ed.2d 351 (1978). Timeliness Shell filed its motion in a reasonable amount of time, as it filed its motion three weeks after the court issued its ruling denying summary judgment. Question of Law The phrase "question of law" in § 1292(b) refers to "a question of the meaning of a statutory or constitutional provision, regulation, or common law doctrine" Ahrenholz v. Board of Trustees of Univ. of Ill., 219 F.3d at 676. Thus, an interlocutory appeal is proper only when the contested issue is "a `pure' question of law rather than merely an issue that might be free from a factual contest." Id. at 677 ("`question of law' means an abstract legal issue rather than an issue of whether summary judgment should be granted"). It is undisputed that Ms. Van Straaten has not suffered any injury as a result of Shell's long-time truncation protocol. Moreover, as Shell recently stopped printing any card digits on receipts in response to the court's denial of summary judgment, she will not suffer any future harm. Thus, Ms. Van Straaten (and her fellow class members if a class is certified) may recover statutory damages only if Shell (1) violated FACTA's truncation provision, see 15 U.S.C. § 1681n(a)(1)(A) (based on a willful violation of FACTA, a plaintiff may recover actual damages or statutory damages of at least $100 but no more than $1,000 per occurrence) and (2) Shell did so in a knowing or reckless manner, see Safeco Ins. Co. v. Burr, 551 U.S. 47, 57, 127 S.Ct. 2201, 167 L.Ed.2d 1045 (2007). The court found that Shell violated FACTA and that whether it acted willfully was a question of fact. The statutory interpretation question was at the heart of the court's order and is at the front of its mind as it considers certification under § 1292(b). If Shell's interpretation of the words "card number" in FACTA is correct, it did not violate FACTA. If so, its truncation protocol by definition would be objectively reasonable and, hence, not a willful violation of FACTA. Determining the meaning of a statute is a question of law. See Ahrenholz v. Board of Trustees of Univ. of Ill., 219 F.3d at 676-77. Moreover, Ms. Van Straaten's characterization of the FACTA issue as fact-driven is incorrect; details about how payment cards are encrypted and processed are necessarily technical but this does not transform a 1020 question of statutory interpretation regarding which numbers to truncate into a fact-based question. Accordingly, the court finds that the interpretation of the words "card number" in FACTA is a question of law. Controlling "A question of law may be deemed `controlling' if its resolution is quite likely to affect the further course of the litigation, even if not certain to do so." Sokaogon Gaming Enterprise Corp. v. Tushie-Montgomery Associates, Inc., 86 F.3d 656, 659 (7th Cir.1996). If Shell's interpretation of "card number" carries the day, for all practical purposes, this case will be over. In addition, in orders disposing of a large percentage of the plaintiff's recoverable damages, "the proper measure of damages is always a controlling question of law." In re Brand Name Prescription Drugs, No. 94 C 897, 1998 WL 808992, at 5 (N.D.Ill. Nov. 17, 1998); see also Hollinger Intern., Inc. v. Hollinger, Inc., No. 04 C 0698, 2005 WL 327058, at 2 (N.D.Ill. Feb. 3, 2005) (collecting cases). If Shell willfully violated FACTA's truncation provisions, it faces an extremely significant statutory damages award if this case proceeds as a class action as FACTA allows statutory damages between $100 and $1,000 per occurrence. See 15 U.S.C. § 1681n(a)(1)(A). Given the number of Shell payment cards in circulation and the associated number of transactions, even the low end of this range would be a very large number. The parties will doubtless have much to say about the propriety of that kind of statutory damages award if that issue is ever before the court. For the present, however, the court finds that the "controlling question" factor has been met. Contestable The third statutory criterion under § 1292(b) is that the question of law must be contestable; i.e., that "substantial grounds for a difference of opinion" on the issue exist. 28 U.S.C. 1292(b). Courts have adopted different definitions of "contestable." An issue may contestable if there is a "difficult central question of law which is not settled by controlling authority" and a "substantial likelihood" exists that the district court's ruling will be reversed on appeal. In re Brand Name Prescription Drugs Antitrust Litigation, 878 F.Supp. 1078, 1081 (N.D.Ill.1995). The existence of conflicting authority may indicate that an issue is contestable. See Hoffman v. Carefirst of Ft. Wayne, Inc., No. 1:09-CV-251, 2010 WL 3940638, at 2 (N.D.Ind. Oct. 6, 2010) (collecting cases); Federal Deposit Ins. Corp. v. First Nat'l Bank of Waukesha, Wisconsin, 604 F.Supp. 616, 620 (D.C.Wis.1985) ("§ 1292(b) was not intended merely to provide an avenue for review of difficult rulings in hard cases, and the mere fact that there is a lack of authority on a disputed issue does not necessarily establish some substantial ground for a difference of opinion under the statute"). On the other hand, the novelty of an issue may demonstrate that an issue is contestable. See City of Joliet v. Mid-City Nat. Bank, No. 05 C 6746, 2008 WL 4889038, at 2 (N.D.Ill. Jun. 13, 2008) (granting motion to certify appeal), aff'd sub nom. by City of Joliet, Ill. v. New West, L.P., 562 F.3d 830 (7th Cir.2009); Bayer Healthcare, LLC v. Norbrook Laboratories, Ltd., Nos. 08 C 953 & 09 C 108, 2010 WL 338089, at 5 (E.D.Wis. Jan. 20, 2010) (issue of first impression created a substantial ground for difference of opinion). The court believes that its analysis of FACTA is correct. Nevertheless, the legal issues posed by Shell's recently abandoned 1021 truncation system, which was linked to its unique method of arranging the digits on the face of its payment cards, are novel and extremely interesting. While the court ultimately ruled against Shell, the FACTA issues in this case were difficult and thought provoking. Moreover, because to this court's knowledge Shell's system was an outlier, the absence of conflicting authority is not meaningful. Accordingly, "[w]hile the court is loath to determine that there is a `substantial likelihood' that it will be reversed on appeal" it nevertheless "determines that the issue presented ... is contestable." City of Joliet v. Mid-City Nat. Bank, 2008 WL 4889038, at 2. On a related note, Shell contends that controlling authority shows that the order at issue is contestable because even if it violated FACTA, its conduct still could be objectively reasonable. This misconstrues the court's decision. In connection with Shell's void for vagueness challenge to FACTA, the court held that the statutory language is sufficiently clear that its prohibitions would be understood by an ordinary person operating a profit-driven business. This begs the question: given that holding, can Shell's now-former protocol be objectively reasonable since it is at odds with FACTA's clear language? This question is why the court considered whether Shell acted willfully or recklessly when it decided what digits to print on receipts. It also further demonstrates how central the FACTA interpretation question, which is at the heart of this court's decision to certify its order for interlocutory appeal and the lynchpin of Ms. Van Straaten's claims, is to this case. If Shell's reading of FACTA is correct, then many other issues potentially fall by the wayside. On the other hand, if Shell is wrong, the court can then consider other fact-based disputes which are easily severable from the FACTA interpretation issue, such as whether Shell acted willfully or recklessly. Materially Advance This brings the court to the final § 1292(b) prong: whether "an immediate appeal from the order may materially advance the ultimate termination of the litigation." 28 U.S.C. § 1292(b). Shell asserts that an immediate appeal will save everyone time and expense and thus materially advance the ultimate termination of this action. This can be said for virtually all interlocutory appeals presenting a potentially dispositive issue. The court also appreciates the inherent inefficiency as well as the extra time and expense associated with an interlocutory appeal. Nevertheless, the court believes that an immediate appeal would materially advance the litigation because a resolution in Shell's favor would essentially end the case and forestall extremely protracted, costly litigation and determination of multiple additional novel and complex issues. Accordingly, for the foregoing reasons, Shell's motion for certification pursuant to 28 U.S.C. § 1292(b) is granted, and the court certifies its September 26, 2011, order denying Shell's motion for summary judgment [Dkt. Nos. 152, 153 & 154] for interlocutory review. To the extent that Shell seeks reconsideration of that order, its motion is denied.	{ "pile_set_name": "FreeLaw" }
126 F.3d 15 YUSUF AHMED ALGHANIM & SONS, W.L.L., Petitioner-Appellee,v.TOYS "R" US, INC.; TRU (HK) Limited, Respondents-Appellants. No. 1757, Docket 96-9692. United States Court of Appeals,Second Circuit. Argued June 25, 1997.Decided Sept. 10, 1997. Michael S. Feldberg, Schulte Roth & Zabel LLP, New York City (Antoinette Passanante, Schulte Roth & Zabel LLP, Dennis J. Block, Stephen A. Radin, Weil, Gotshal & Manges, New York City, of counsel), for Respondents-Appellants. Joseph D. Pizzurro, Curtis, Mallet-Prevost, Colt & Mosle, New York City (Herbert M. Lord, Michelle A. Rice, Curtis, Mallet-Prevost, Colt & Mosle, New York City, of counsel), for Petitioner-Appellee. Before: MINER and McLAUGHLIN, Circuit Judges, and SCULLIN, District Judge.* MINER, Circuit Judge. 1 Appeal from a judgment entered in the United States District Court for the Southern District of New York (McKenna, J.) denying respondents' cross-motion to vacate or modify an arbitration award and granting the petition to confirm the award. The court found that while the petition for confirmation was brought under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, respondents' cross-motion to vacate or modify the award was properly brought under the Federal Arbitration Act, and thus those claims were governed by the Federal Arbitration Act's implied grounds for vacatur. Nonetheless, the court granted the petition to confirm the award, finding that respondents' allegations of error in the arbitral award were without merit. 2 For the reasons that follow, we affirm. BACKGROUND 3 In November of 1982, respondent-appellant Toys "R" Us, Inc. (collectively with respondent-appellant TRU (HK) Limited, "Toys 'R' Us") and petitioner-appellee Yusuf Ahmed Alghanim & Sons, W.L.L. ("Alghanim"), a privately owned Kuwaiti business, entered into a License and Technical Assistance Agreement (the "agreement") and a Supply Agreement. Through the agreement, Toys "R" Us granted Alghanim a limited right to open Toys "R" Us stores and use its trademarks in Kuwait and 13 other countries located in and around the Middle East (the "territory"). Toys "R" Us further agreed to supply Alghanim with its technology, expertise and assistance in the toy business. 4 From 1982 to the December 1993 commencement of the arbitration giving rise to this appeal, Alghanim opened four toy stores, all in Kuwait. According to Toys "R" Us, the first such store, opened in 1983, resembled a Toys "R" Us store in the United States, but the other three, two of which were opened in 1985 and one in 1988, were small storefronts with only limited merchandise. It is uncontested that Alghanim's stores lost some $6.65 million over the 11-year period from 1982 to 1993, and turned a profit only in one year of this period. 5 Following the Gulf War, both Alghanim and Toys "R" Us apparently concluded that their relationship needed to be altered. Representatives of Alghanim and Toys "R" Us's International Division met in September of 1991 and February of 1992. Alghanim expressed a desire for Toys "R" Us to contribute capital toward Alghanim's expansion into other countries. Alghanim advised that it would be willing to proceed in the business only under a new joint venture agreement that would shift a substantial portion of responsibility for capital expenditures to Toys "R" Us. Toys "R" Us was unwilling to take on a greater portion of this responsibility. 6 On July 20, 1992, Toys "R" Us purported to exercise its right to terminate the agreement, sending Alghanim a notice of non-renewal stating that the agreement would terminate on January 31, 1993. Alghanim responded on July 30, 1992, stating that because its most recently opened toy store had opened on January 16, 1988, the initial term of the agreement ended on January 16, 1993. Alghanim asserted that Toys "R" Us's notice of non-renewal was four days late in providing notice six months before the end of the initial period. According to Alghanim, under the termination provision of the agreement, Toys "R" Us's failure to provide notice more than six months before the fifth year after the opening of the most recent store automatically extended the term of the agreement for an additional two years, until January 16, 1995. 7 On September 2, 1992, Toys "R" Us sent a second letter. Toys "R" Us explained that, on further inspection of the agreement, it had determined that the initial term of the agreement expired on December 31, 1993, and it again gave notice of non-renewal. In this letter, Toys "R" Us also directed Alghanim not to open any new toy stores and warned that failure to comply with that direction could constitute a breach of the agreement. 8 Through the balance of 1992 and 1993, the parties unsuccessfully attempted to renegotiate the agreement or devise a new arrangement. In September of 1993, the parties discussed Alghanim's willingness to relinquish its rights under the agreement. In one discussion, Amin Kadrie, Alghanim's chief operating officer and the head of its toy business, offered to "release the business right now" if Toys "R" Us would "give us $2 million for the losses we've incurred [in] trying to develop this business." (J.A. 457.) Toys "R" Us declined, offering instead to buy Alghanim's inventory at Alghanim's cost. The parties could not agree upon a reconciliation. 9 At the end of 1993, Toys "R" Us contracted with Al-Futtaim Sons Co., LLC ("Al-Futtaim") for the post-Alghanim rights to open Toys "R" Us stores in five of the countries under the agreement, including Kuwait, and with ATA Development Co. ("ATA") for the post-Alghanim rights to open Toys "R" Us stores in Saudi Arabia. These two companies initially offered $30 million for the rights, and eventually paid a total of $22.5 million. 10 On December 20, 1993, Toys "R" Us invoked the dispute-resolution mechanism in the agreement, initiating an arbitration before the American Arbitration Association. Toys "R" Us sought a declaration that the agreement was terminated on December 31, 1993. Alghanim responded by counterclaiming for breach of contract. 11 On May 4, 1994, the arbitrator denied Toys "R" Us's request for declaratory judgment. The arbitrator found that, under the termination provisions of the agreement, Alghanim had the absolute right to open toy stores, even after being given notice of termination, as long as the last toy store was opened within five years. The parties then engaged in substantial document and expert discovery, motion practice, and a 29-day evidentiary hearing on Alghanim's counterclaims. 12 On July 11, 1996, the arbitrator awarded Alghanim $46.44 million for lost profits under the agreement, plus 9 percent interest to accrue from December 31, 1994. The arbitrator's findings and legal conclusions were set forth in a 47-page opinion. 13 Alghanim petitioned the district court to confirm the award under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards of June 10, 1958 ("Convention"), 21 U.S.T. 2517, 330 U.N.T.S. 38, reprinted at 9 U.S.C. § 201.1 Toys "R" Us cross-moved to vacate or modify the award under the Federal Arbitration Act ("FAA"), 9 U.S.C. § 1 et seq., arguing that the award was clearly irrational, in manifest disregard of the law, and in manifest disregard of the terms of the agreement. The district court concluded that "[t]he Convention and the FAA afford overlapping coverage, and the fact that a petition to confirm is brought under the Convention does not foreclose a cross-motion to vacate under the FAA, and the Court will consider [Toys "R" Us's] cross-motion under the standards of the FAA." (J.A. 569-70 (citation omitted).) By judgment entered December 20, 1996, the district court confirmed the award, finding Toys "R" Us's objections to the award to be without merit. This appeal followed. DISCUSSION 14 I. Availability of the FAA's Grounds for Relief in Confirmation Under the Convention 15 Toys "R" Us argues that the district court correctly determined that the provisions of the FAA apply to its cross-motion to vacate or modify the arbitral award. In particular, Toys "R" Us contends that the FAA and the Convention have overlapping coverage. Thus, Toys "R" Us argues, even though the petition to confirm the arbitral award was brought under the Convention, the FAA's implied grounds for vacatur should apply to Toys "R" Us's cross-motion to vacate or modify because the cross-motion was brought under the FAA. We agree that the FAA governs Toys "R" Us's cross-motion. A. Applicability of the Convention 16 Neither party seriously disputes the applicability of the Convention to this case and it is clear to us that the Convention does apply. The Convention provides that it will 17 apply to the recognition and enforcement of arbitral awards made in the territory of a State other than the State where the recognition and enforcement of such awards are sought, and arising out of differences between persons, whether physical or legal. It shall also apply to arbitral awards not considered as domestic awards in the State where their recognition and enforcement are sought. 18 Convention art. I(1) (emphasis added). The Convention does not define nondomestic awards. See Bergesen v. Joseph Muller Corp., 710 F.2d 928, 932 (2d Cir.1983). However, 9 U.S.C. § 202, one of the provisions implementing the Convention, provides that 19 [a]n agreement or award arising out of such a relationship which is entirely between citizens of the United States shall be deemed not to fall under the Convention unless that relationship involves property located abroad, envisages performance or enforcement abroad, or has some other reasonable relation with one or more foreign states. 20 In Bergesen, we held "that awards 'not considered as domestic' denotes awards which are subject to the Convention not because made abroad, but because made within the legal framework of another country, e.g., pronounced in accordance with foreign law or involving parties domiciled or having their principal place of business outside the enforcing jurisdiction." 710 F.2d at 932 (quoting 9 U.S.C. § 201). The Seventh Circuit similarly has interpreted § 202 to mean that "any commercial arbitral agreement, unless it is between two United States citizens, involves property located in the United States, and has no reasonable relationship with one or more foreign states, falls under the Convention." Jain v. de Mere, 51 F.3d 686, 689 (7th Cir.), cert. denied, --- U.S. ----, 116 S.Ct. 300, 133 L.Ed.2d 206 (1995). 21 The Convention's applicability in this case is clear. The dispute giving rise to this appeal involved two nondomestic parties and one United States corporation, and principally involved conduct and contract performance in the Middle East. Thus, we consider the arbitral award leading to this action a non-domestic award and thus within the scope of the Convention. 22 B. Authority Under the Convention to Set Aside An Award Under Domestic Arbitral Law 23 Toys "R" Us argues that the district court properly found that it had the authority under the Convention to apply the FAA's implied grounds for setting aside the award. We agree. 24 Under the Convention, the district court's role in reviewing a foreign arbitral award is strictly limited: "The court shall confirm the award unless it finds one of the grounds for refusal or deferral of recognition or enforcement of the award specified in the said Convention." 9 U.S.C. § 207; see Andros Compania Maritima, S.A. v. Marc Rich & Co., A.G., 579 F.2d 691, 699 n. 11 (2d Cir.1978). Under Article V of the Convention, the grounds for refusing to recognize or enforce an arbitral award are: 25 (a) The parties to the agreement ... were ... under some incapacity, or the said agreement is not valid under the law ...; or 26 (b) The party against whom the award is invoked was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings ...; or 27 (c) The award deals with a difference not contemplated by or not falling within the terms of the submission to arbitration, or it contains decisions on matters beyond the scope of the submission to arbitration ...; or 28 (d) The composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties ...; or 29 (e) The award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made. 30 Convention art. V(1). Enforcement may also be refused if "[t]he subject matter of the difference is not capable of settlement by arbitration," or if "recognition or enforcement of the award would be contrary to the public policy" of the country in which enforcement or recognition is sought. Id. art. V(2). These seven grounds are the only grounds explicitly provided under the Convention. 31 In determining the availability of the FAA's implied grounds for setting aside, the text of the Convention leaves us with two questions: (1) whether, in addition to the Convention's express grounds for refusal, other grounds can be read into the Convention by implication, much as American courts have read implied grounds for relief into the FAA, and (2) whether, under Article V(1)(e), the courts of the United States are authorized to apply United States procedural arbitral law, i.e., the FAA, to nondomestic awards rendered in the United States. We answer the first question in the negative and the second in the affirmative. 32 1. Availability Under the Convention of Implied Grounds for Refusal 33 We have held that the FAA and the Convention have "overlapping coverage" to the extent that they do not conflict. Bergesen, 710 F.2d at 934; see 9 U.S.C. § 208 (FAA may apply to actions brought under the Convention "to the extent that [the FAA] is not in conflict with [9 U.S.C. §§ 201-208] or the Convention as ratified by the United States"); Lander Co. v. MMP Invs., Inc., 107 F.3d 476, 481 (7th Cir.1997), cert. denied, --- U.S. ----, 118 S.Ct. 55, --- L.Ed.2d ----, (1997). However, by that same token, to the extent that the Convention prescribes the exclusive grounds for relief from an award under the Convention, that application of the FAA's implied grounds would be in conflict, and is thus precluded. See, e.g., M & C Corp. v. Erwin Behr GmbH & Co., KG, 87 F.3d 844, 851 (6th Cir.1996) 34 In Parsons & Whittemore Overseas Co. v. Societe Generale de L'Industrie du Papier (Rakta), 508 F.2d 969 (2d Cir.1974), we declined to decide whether the implied defense of "manifest disregard" applies under the Convention, having decided that even if it did, appellant's claim would fail. See id. at 977. Nonetheless, we noted that "[b]oth the legislative history of Article V and the statute enacted to implement the United States' accession to the Convention are strong authority for treating as exclusive the bases set forth in the Convention for vacating an award." Id. (citation and footnote omitted). 35 There is now considerable caselaw holding that, in an action to confirm an award rendered in, or under the law of, a foreign jurisdiction, the grounds for relief enumerated in Article V of the Convention are the only grounds available for setting aside an arbitral award. See, e.g., M & C, 87 F.3d at 851 (concluding that the Convention's exclusive grounds for relief "do not include miscalculations of fact or manifest disregard of the law"); International Standard Elec. Corp. v. Bridas Sociedad Anonima Petrolera, Industrial Y Comercial, 745 F.Supp. 172, 181-82 (S.D.N.Y.1990) (refusing to apply a "manifest disregard of law" standard on a motion to vacate a foreign arbitral award); Brandeis Intsel Ltd. v. Calabrian Chems. Corp., 656 F.Supp. 160, 167 (S.D.N.Y.1987) ("In my view, the 'manifest disregard' defense is not available under Article V of the Convention or otherwise to a party ... seeking to vacate an award of foreign arbitrators based upon foreign law."); see also Albert Jan van den Berg, The New York Arbitration Convention of 1958: Towards a Uniform Judicial Interpretation 265 (1981) ("the grounds mentioned in Article V are exhaustive "). This conclusion is consistent with the Convention's pro-enforcement bias. See, e.g., Scherk v. Alberto-Culver Co., 417 U.S. 506, 519-20 & n. 15, 94 S.Ct. 2449, 2457 & n. 15, 41 L.Ed.2d 270 (1974); Parsons, 508 F.2d at 973. We join these courts in declining to read into the Convention the FAA's implied defenses to confirmation of an arbitral award. 36 2. Nondomestic Award Rendered in the United States 37 Although Article V provides the exclusive grounds for refusing confirmation under the Convention, one of those exclusive grounds is where "[t]he award ... has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made." Convention art. V(1)(e). Those courts holding that implied defenses were inapplicable under the Convention did so in the context of petitions to confirm awards rendered abroad. These courts were not presented with the question whether Article V(1)(e) authorizes an action to set aside an arbitral award under the domestic law of the state in which, or under which, the award was rendered.2 We, however, are faced head-on with that question in the case before us, because the arbitral award in this case was rendered in the United States, and both confirmation and vacatur were then sought in the United States. 38 We read Article V(1)(e) of the Convention to allow a court in the country under whose law the arbitration was conducted to apply domestic arbitral law, in this case the FAA, to a motion to set aside or vacate that arbitral award. The district court in Spector v. Torenberg, 852 F.Supp. 201 (S.D.N.Y.1994), reached the same conclusion as we do now, reasoning that, because the Convention allows the district court to refuse to enforce an award that has been vacated by a competent authority in the country where the award was rendered, the court may apply FAA standards to a motion to vacate a nondomestic award rendered in the United States. See id. at 205-06 & n. 4. 39 The Seventh Circuit has agreed, albeit in passing, that the Convention "contemplates the possibility of the award's being set aside in a proceeding under local law." Lander, 107 F.3d at 478 (citing Article V(1)(e)). Likewise, the United States District Court for the District of Columbia has found that, in an arbitration conducted in Egypt and under Egyptian law, nullification of the award by the Egyptian courts falls within Article V(1)(e). See Chromalloy Aeroservices v. Arab Republic of Egypt, 939 F.Supp. 907, 909 (D.D.C.1996). 40 Our conclusion also is consistent with the reasoning of courts that have refused to apply non-Convention grounds for relief where awards were rendered outside the United States. For example, the Sixth Circuit in M & C concluded that it should not apply the FAA's implied grounds for vacatur, because the United States did not provide the law of the arbitration for the purposes of Article V(1)(e) of the Convention. 87 F.3d at 849. Similarly, in International Standard, the district court decided that only the state under whose procedural law the arbitration was conducted has jurisdiction under Article V(1)(e) to vacate the award, whereas on a petition for confirmation made in any other state, only the defenses to confirmation listed in Article V of the Convention are available. 745 F.Supp. at 178. 41 This interpretation of Article V(1)(e) also finds support in the scholarly work of commentators on the Convention and in the judicial decisions of our sister signatories to the Convention. There appears to be no dispute among these authorities that an action to set aside an international arbitral award, as contemplated by Article V(1)(e), is controlled by the domestic law of the rendering state.3 As one commentator has explained: 42 The possible effect of this ground for refusal [Article V(1)(e) ] is that, as the award can be set aside in the country of origin on all grounds contained in the arbitration law of that country, including the public policy of that country, the grounds for refusal of enforcement under the Convention may indirectly be extended to include all kinds of particularities of the arbitration law of the country of origin. This might undermine the limitative character of the grounds for refusal listed in Article V ... and thus decrease the degree of uniformity existing under the Convention. 43 van den Berg, supra, at 355; see also Case No. 2 Nd 502/80 (Feb. 1, 1980) (Aus.), excerpted in 7 Y.B. Com. Arb. 312, 313 (1982) (in action to set aside an arbitral award, court applies "the law of the country in which the award has been made"). The defense in Article V(1)(e)incorporates the entire body of review rights in the issuing jurisdiction.... If the scope of judicial review in the rendering state extends beyond the other six defenses allowed under the New York Convention, the losing party's opportunity to avoid enforcement is automatically enhanced: The losing party can first attempt to derail the award on appeal on grounds that would not be permitted elsewhere during enforcement proceedings. 44 Daniel M. Kolkey, Attacking Arbitral Awards: Rights of Appeal and Review in International Arbitrations, 22 Int'l Law. 693, 694 (1988). 45 Indeed, many commentators and foreign courts have concluded that an action to set aside an award can be brought only under the domestic law of the arbitral forum, and can never be made under the Convention. See Shenzhen Nan Da Indus. & Trade United Co. v. FM Int'l Ltd., 1992 H.K. Law Digest C6 (Sup.Ct.H.K. Mar. 2, 1991), excerpted in 18 Y.B. Com. Arb. 377, 382 (1993) ("Various decisions have made clear that the Convention is not applicable for setting aside awards. The court of the country of origin of the award is the only court competent to rule."); van den Berg, supra, at 20 ("[T]he Convention is not applicable in the action for setting aside the award."); id. ("These provisions affirm the well-established principle of current international commercial arbitration that the court of the country of origin is exclusively competent to decide on the setting aside of the award."); Jan Paulsson, The Role of Swedish Courts in Transnational Commercial Arbitration, 21 Va. J. Int'l L. 211, 242 (1981) ("[T]he fact is that setting aside awards under the New York Convention can take place only in the country in which the award was made."). 46 There is no indication in the Convention of any intention to deprive the rendering state of its supervisory authority over an arbitral award, including its authority to set aside that award under domestic law. The Convention succeeded and replaced the Convention on the Execution of Foreign Arbitral Awards ("Geneva Convention"), Sept. 26, 1927, 92 L.N.T.S. 301. The primary defect of the Geneva Convention was that it required an award first to be recognized in the rendering state before it could be enforced abroad, see Geneva Convention arts. 1(d), 4(2), 92 L.N.T.S. at 305, 306, the so-called requirement of "double exequatur." See Jane L. Volz & Roger S. Haydock, Foreign Arbitral Awards: Enforcing the Award Against the Recalcitrant Loser, 21 Wm. Mitchell L.Rev. 867, 876-77 (1996); W. Laurence Craig, Some Trends and Developments in the Laws and Practice of International Commercial Arbitration, 30 Tex. Int'l L.J. 1, 9 (1995). This requirement "was an unnecessary time-consuming hurdle," van den Berg, supra, at 267, and "greatly limited [the Geneva Convention's] utility," Craig, supra, at 9. 47 The Convention eliminated this problem by eradicating the requirement that a court in the rendering state recognize an award before it could be taken and enforced abroad. In so doing, the Convention intentionally "liberalized procedures for enforcing foreign arbitral awards," Volz & Haydock, supra, at 878; see Scherk, 417 U.S. at 519-20 & n. 15, 94 S.Ct. at 2457 & n. 15; Parsons, 508 F.2d at 973 (noting "[t]he general pro-enforcement bias informing the Convention and explaining its supersession of the Geneva Convention"). 48 Nonetheless, under the Convention, the power and authority of the local courts of the rendering state remain of paramount importance. "What the Convention did not do ... was provide any international mechanism to insure the validity of the award where rendered. This was left to the provisions of local law. The Convention provides no restraint whatsoever on the control functions of local courts at the seat of arbitration." Craig, supra, at 11. Another commentator explained: 49 Significantly, [Article V(1)(e) ] fails to specify the grounds upon which the rendering State may set aside or suspend the award. While it would have provided greater reliability to the enforcement of awards under the Convention had the available grounds been defined in some way, such action would have constituted meddling with national procedure for handling domestic awards, a subject beyond the competence of the Conference. 50 Leonard V. Quigley, Accession by the United States to the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 70 Yale L.J. 1049, 1070 (1961). From the plain language and history of the Convention, it is thus apparent that a party may seek to vacate or set aside an award in the state in which, or under the law of which, the award is rendered. Moreover, the language and history of the Convention make it clear that such a motion is to be governed by domestic law of the rendering state, despite the fact that the award is nondomestic within the meaning of the Convention as we have interpreted it in Bergesen, 710 F.2d at 932. 51 In sum, we conclude that the Convention mandates very different regimes for the review of arbitral awards (1) in the state in which, or under the law of which, the award was made, and (2) in other states where recognition and enforcement are sought. The Convention specifically contemplates that the state in which, or under the law of which, the award is made, will be free to set aside or modify an award in accordance with its domestic arbitral law and its full panoply of express and implied grounds for relief. See Convention art. V(1)(e). However, the Convention is equally clear that when an action for enforcement is brought in a foreign state, the state may refuse to enforce the award only on the grounds explicitly set forth in Article V of the Convention. II. Application of FAA Grounds for Relief 52 Having determined that the FAA does govern Toys "R" Us's cross-motion to vacate, our application of the FAA's implied grounds for vacatur is swift. The Supreme Court has stated "that courts of appeals should apply ordinary, not special, standards when reviewing district court decisions upholding arbitration awards." First Options of Chicago, Inc. v. Kaplan, 514 U.S. 938, 948, 115 S.Ct. 1920, 1926, 131 L.Ed.2d 985 (1995). We review the district court's findings of fact for clear error and its conclusions of law de novo. See id. 53 "[T]he confirmation of an arbitration award is a summary proceeding that merely makes what is already a final arbitration award a judgment of the court." Florasynth, Inc. v. Pickholz, 750 F.2d 171, 176 (2d Cir.1984). The review of arbitration awards is "very limited ... in order to avoid undermining the twin goals of arbitration, namely, settling disputes efficiently and avoiding long and expensive litigation." Folkways Music Publishers, Inc. v. Weiss, 989 F.2d 108, 111 (2d Cir.1993). Accordingly, "the showing required to avoid summary confirmance is high." Ottley v. Schwartzberg, 819 F.2d 373, 376 (2d Cir.1987). 54 More particularly, "[t]his court has generally refused to second guess an arbitrator's resolution of a contract dispute." John T. Brady & Co. v. Form-Eze Sys., Inc., 623 F.2d 261, 264 (2d Cir.1980). As we have explained: "An arbitrator's decision is entitled to substantial deference, and the arbitrator need only explicate his reasoning under the contract 'in terms that offer even a barely colorable justification for the outcome reached' in order to withstand judicial scrutiny." In re Marine Pollution Serv., Inc., 857 F.2d 91, 94 (2d Cir.1988) (quoting Andros Compania, 579 F.2d at 704). 55 However, awards may be vacated, see 9 U.S.C. § 10, or modified, see id. § 11, in the limited circumstances where the arbitrator's award is in manifest disregard of the terms of the agreement, see Leed Architectural Prods., Inc. v. United Steelworkers, Local 6674, 916 F.2d 63, 65-66 (2d Cir.1990), or where the award is in "manifest disregard of the law," Fahnestock & Co. v. Waltman, 935 F.2d 512, 515-16 (2d Cir.1991); Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Bobker, 808 F.2d 930, 933-34 (2d Cir.1986). We find that neither of these implied grounds is met in the present case. A. Manifest Disregard of the Law 56 Toys "R" Us argues that the arbitrator manifestly disregarded New York law on lost profits awards for breach of contract by returning a speculative award. This contention is without merit. "[M]ere error in the law or failure on the part of the arbitrator[ ] to understand or apply the law" is not sufficient to establish manifest disregard of the law. Fahnestock, 935 F.2d at 516 (quotations omitted). For an award to be in "manifest disregard of the law," 57 [t]he error must have been obvious and capable of being readily and instantly perceived by the average person qualified to serve as an arbitrator. Moreover, the term "disregard" implies that the arbitrator appreciates the existence of a clearly governing legal principle but decides to ignore or pay no attention to it. 58 Merrill Lynch, 808 F.2d at 933. 59 In the instant case, the arbitrator was well aware of and carefully applied New York's law on lost profits.4 The arbitrator specifically addressed Kenford Co. v. County of Erie, 67 N.Y.2d 257, 502 N.Y.S.2d 131, 493 N.E.2d 234 (1986), which contains New York's law on the subject and upon which Toys "R" Us relied in its arguments,5 and concluded: 60 I do not think the Kenford case rules out damages in this case. Kenford disallowed damages based on future profits from concessions in a domed stadium that was never built.... In this case [Alghanim], which is forced into the estimating posture because of [Toys "R" Us's] breach, bases its damages not on its own experience but on [Toys "R" Us's]. [Toys "R" Us] has hundreds of toy stores worldwide. Since it has been found that the Agreements require [Toys "R" Us] to provide a wide variety of services, similar to what it provides its own toy stores, I find that [Alghanim's] method of estimating damages is reasonable and believable, and provides a sound basis on which to fashion the award. 61 (J.A. 557.) We find no manifest disregard of the law in this analysis. 62 Toys "R" Us also argues that the arbitrator manifestly disregarded the law of lost profits by ignoring the facts that (1) Alghanim's toy business had lost a total of $6.65 million over the course of its existence under the agreement, and (2) Alghanim itself offered to relinquish its rights for $2 million. Toys "R" Us further contends that the calculation of lost profits was irrational. We reject these contentions as well. 63 The fact that Alghanim lost $6.65 million over ten years does not make the arbitrator's award of future lost profits of $46 million "completely irrational." Past losses do not necessarily negate any expectation of future profits. See, e.g., Lamborn v. Dittmer, 873 F.2d 522, 533 (2d Cir.1989) ("[W]e reject outright the suggestion in Dittmer's papers that a business with no history of profits is necessarily valueless."). 64 As to the purported $2 million buyout offer, no witness has testified that the $2 million figure was an estimate of the value of Alghanim's toy business. Kadrie, the primary Alghanim officer involved with the toy business, testified that, in his understanding, settlement with Toys "R" Us would serve to provide Alghanim "some relief on the cost of liquidating [its] inventory." (J.A. 405-06.) Accordingly, Alghanim argues that $2 million was the value Alghanim placed on its inventory at the time. Furthermore, according to a Toys "R" Us executive, Kadrie, in making this offer, expressly stated that the $2 million was to recoup losses Alghanim had incurred in trying to develop the business. Therefore, there is no proof that this figure was Alghanim's, or anyone else's, estimation of the value of the business. Thus, the arbitrator did not manifestly disregard lost profits law in refusing to treat the $2 million figure as a buyout offer. 65 We also reject Toys "R" Us's contention that the arbitrator's calculation of lost profits was in manifest disregard of the law. Toys "R" Us contends that the actual operating results of the Toys "R" Us stores in the territory since the breach of the agreement have been lower than the arbitrator's valuation would suggest. The arbitrator explicitly addressed this issue, reasoning that[Alghanim's] damages are to be calculated as of September 2, 1992 and are based on what its rights were worth at that time. More importantly, since the start of this case in late 1993 it has been clear that large stakes are involved and that [Toys "R" Us's] actual results of operations in the Middle East could have a bearing on this case. The record does not provide a sufficient basis to disentangle [Toys "R" Us's] actual results ... from what might have been the business results of [Toys "R" Us's] Mid-East venture if this case had never existed. 66 (J.A. 558.) There is no manifest disregard in the arbitrator's refusal to credit actual operating results for the period following the breach in calculating the value of the business at the time of the breach. 67 Toys "R" Us also argues that the arbitrator was wholly irrational in calculating the value of the Saudi Arabian rights as the $15 million ATA initially offered for those rights, when ultimately ATA only paid $7.5 million. However, the fact that a disinterested third party valued the Saudi Arabian rights at $15 million near the time of the breach provides a rational basis for accepting that valuation. Therefore, we see no manifest disregard in the arbitrator's use in his calculations of the bid price, rather than the actual closing price, for the sale to ATA. Thus, we see no merit in Toys "R" Us's contentions of manifest disregard of the law. B. Manifest Disregard of the Agreement 68 Toys "R" Us also argues that the district court erred in refusing to vacate the award because the arbitrator manifestly disregarded the terms of the agreement. In particular, Toys "R" Us disputes the arbitrator's interpretation of four contract terms: (1) the termination provision; (2) the conforming stores provision; (3) the non-assignment provision; and (4) the deletion provision. We find no error. 69 Interpretation of these contract terms is within the province of the arbitrator and will not be overruled simply because we disagree with that interpretation. See United Steelworkers v. Enterprise Wheel & Car Corp., 363 U.S. 593, 599, 80 S.Ct. 1358, 1362, 4 L.Ed.2d 1424 (1960). We will overturn an award where the arbitrator merely "mak[es] the right noises--noises of contract interpretation--" while ignoring the clear meaning of contract terms. In re Marine Pollution, 857 F.2d at 94 (quotation omitted). We apply a notion of "manifest disregard" to the terms of the agreement analogous to that employed in the context of manifest disregard of the law. 70 As to each of these contract provisions, Toys "R" Us merely takes issue with the arbitrator's well-reasoned interpretations of those provisions, and simply offers its own contrary interpretations. Toys "R" Us does not advance a convincing argument that the arbitrator manifestly disregarded the agreement. We will not overturn the arbitrator's award merely because we do not concur with the arbitrator's reading of the agreement. For the reasons stated by the district court, we find the arbitrator's interpretation of the contractual provisions supportable. 71 We have carefully considered Toys "R" Us's remaining contentions and find them all to be without merit. CONCLUSION 72 For the foregoing reasons, the judgment of the district court is affirmed. * The Honorable Frederick J. Scullin, Jr. of the United States District Court for the Northern District of New York, sitting by designation 1 The Convention, frequently referred to as the "New York Convention" or the "1958 Convention," was enacted and opened for signature in New York City on June 10, 1958, and entered into force in the United States after ratification on December 29, 1970, as codified at 9 U.S.C. §§ 201-208 2 In both Celulsa Del Pacifico S.A. v. A. Ahlstrom Corp., No. 95 Civ. 9586, 1996 WL 103826 (S.D.N.Y. Mar. 11, 1996), and Avraham v. Shigur Express Ltd., No. 91 Civ. 1238, 1991 WL 177633 (S.D.N.Y. Sept. 4, 1991), district courts in this Circuit refused to recognize the applicability of the FAA's implied grounds for relief to nondomestic awards that had been rendered in the United States and were subject to confirmation under the Convention. However, in neither case did the district court address the significance of Article V(1)(e) 3 Although most courts and commentators assume that Article V(1)(e) is applicable to the state in which the award is rendered, we note that Article V(1)(e) specifically contemplates the possibility that an award could be rendered in one state, but under the arbitral law of another state. See Convention art. V(1)(e) ("or has been set aside or suspended by a competent authority of the country in which, or under the law of which, that award was made" (emphasis added)). In the rare instance where that is the case, Article V(1)(e) would apply to the state that supplied the arbitral law under which the award was made. See, e.g., van den Berg, supra, at 350. This situation may be so rare as to be a "dead letter." See id. at 28 4 There is no dispute that New York law controls 5 In Kenford, lost profits were unavailable to the prevailing party because such an award would "require speculation and conjecture, making it beyond the capability of even the most sophisticated procedures to satisfy the legal requirements of proof with reasonable certainty." 67 N.Y.2d at 262, 502 N.Y.S.2d 131, 493 N.E.2d 234; see Lama Holding Co. v. Smith Barney Inc., 88 N.Y.2d 413, 425, 646 N.Y.S.2d 76, 668 N.E.2d 1370 (1996)	{ "pile_set_name": "FreeLaw" }
170 So.2d 114 (1964) Charles JOLLEY et ux., Plaintiffs-Appellants, v. CONTINENTAL SOUTHERN LINES, INC., et al., Defendants-Appellees. No. 10308. Court of Appeal of Louisiana, Second Circuit. December 14, 1964. Estess & Miller, Shreveport, for appellants. Stafford & Pitts, Alexandria, for appellees. Before HARDY, GLADNEY and AYRES, JJ. 115 GLADNEY, Judge. In the trial court four suits were consolidated involving claims arising from an accident which occurred at the intersection of U. S. Highways 80 and 65 in Tallulah, Louisiana, after midnight on February 5, 1962. Principally involved were separate suits by two passengers and countersuits by Auto Transports, Inc. and Continental Southern Bus Lines, Inc. In the appeal presently under consideration, Charles Jolley and his wife brought suit against Continental Southern Lines, Inc. and Auto Transports, Inc. and the latter's liability insurer, Transport Insurance Company. The judgment of the trial court in disposing of this suit rendered judgment in favor of Charles Jolley for special damages in the sum of $665.19 and in favor of Mrs. Margaret Jolley for the sum of $1,000.00 for personal injuries sustained by her. Both awards were against Continental Southern Lines, Inc., the judgment holding that the other named defendants were free of liability. From this decree plaintiffs have appealed and Continental Southern Lines, Inc., has answered the appeal taken by plaintiffs requesting this court to reduce the award of special damages awarded Charles Jolley by eliminating therefrom the sum of $450.00 for expenses for a future corrective operation for Mrs. Jolley. In the case of E. B. Ethridge against the Continental Southern Lines, Inc., following a decree in his favor in the district court, an appeal was not taken. Separate decrees in this court have been rendered in the other two cases in which appeals were so taken. See Auto Transports, Inc. v. Continental Southern Lines, Inc., La. App., 170 So.2d 120 and Continental Southern Lines Inc. v. Auto Transports Inc., La. App., 170 So.2d 120. Following trial of the instant case the judge of the district court rendered an exhaustive opinion which so accurately narrates the facts and issues and which so completely accords with our views that we adopt his opinion as our own with modification only by the elimination of references to the transcript and that portion of the decree dealing with awards. The opinion follows: "All of the suits arose out of an accident that occurred shortly after midnight on February 5, 1962, at the intersection of U. S. Highway 65 (North Cedar Street) and U. S. Highway 80 (East Green Street) in the Village of Tallulah, Madison Parish, Louisiana. The accident involved a Silver Eagle Bus (Passenger bus) owned by Continental Southern Lines, Inc., driven by James Kelly, traveling west on U. S. Highway 80, which vehicle shall be referred to hereinafter simply as `Bus', and an automobile transport (truck and trailer, loaded with 6 new automobiles), owned by Auto Transports, Inc., which company's name has been formally changed to Woods Industries, Inc., Kansas City Division, insured by Transport Insurance Company, driven by Billy R. Teague, traveling south on U. S. Highway 65, which vehicle shall be referred to hereinafter simply as `Transport'. "Vehicular traffic approaching this intersection at the time of the accident was governed by blinking or flashing red and amber lights placed at the intersection by the Department of Highways. Traffic on U. S. Highway 80 was controlled by red blinking or flashing lights; whereas the traffic on U. S. Highway 65 was governed by amber blinking or flashing lights. The intersection was blind for the two vehicles involved herein, inasmuch as a high brick building used as the City Hall and Fire Station was situated on the northeast corner of the intersection. This building obstructed the vision of the two drivers to such an extent that neither of them could observe the approach of the other until one of the vehicles had entered or practically entered the intersection. At the trial before this Court, the question of fault in these consolidated cases was submitted on the transcribed testimony that was taken in another personal injury case, by one of the passengers on the `Bus', arising out of the same accident that was tried before a jury in the United States District Court for the Western District of Louisiana, in 116 the Monroe Division, entitled `James A. Smith versus Continental Southern Lines, Inc., Auto Transport Insurance Company', which case shall be hereinafter referred to simply as the `Smith case'. "The actionable negligence of the driver of the `Bus' is conceded, and the following facts were stipulated: "`The bus of defendant, Continental Southern Lines, Inc., was equipped with a tachograph, or automatic recorder of the speed of the bus; and this tachograph showed the speed of the bus to have been twenty-eight (28) miles per hour at the moment of impact in the accident involved in this suit' "The principal issue to be decided in these consolidated cases is whether the `Transport' driver was guilty of negligence, which would subject his company and its insurer to solidary liability as a joint tort feasor with the `Bus' company and which would amount to contributory negligence thus barring recovery by the `Transport' company and its insurer. When this issue is resolved only the question of quantum will remain. "The bus driver's approach and entry into this intersection at a speed of 28 miles per hour with blinking or flashing red lights facing him at the moment of impact was gross negligence particularly since he was transporting fare paying passengers, which negligence has been conceded and stipulated by the `Bus' company and its insurer. "In the two consolidated cases, Ethridge and Jolley claim joint and concurrent negligence on the part of both drivers, but the burden of establishing negligence on the part of the `Transport' driver is on the plaintiffs. In the case of the `Transport' company against the `Bus' company, because of the concession of actionable negligence on the part of the `Bus' company, the burden is upon the `Bus' company to establish contributory negligence on the part of the `Transport' driver. "A careful study of the transcript of the testimony taken in the `Smith' case establishes that Billy Ray Teague, the driver of the `Transport', was enroute from Kansas City, Kansas, to Biloxi, Mississippi. Shortly after midnight on February 5, 1962 he was traveling south on U. S. Highway 65 within the Village of Tallulah, Louisiana, and when he was within 300 to 400 feet of the intersection of U. S. Highway 65 and U. S. Highway 80, while traveling at a speed of 20 to 25 miles per hour, he observed flashing yellow traffic lights facing him; that at this time knowing that he must turn left at this intersection, he decelerated and upon approaching the intersection he looked left, the visibility being obstructed by the building. He then looked right and entered the intersection in second gear at a speed of 6 to 8 miles per hour. While approaching and before entry into the intersection he observed that the traffic on the intersecting street or highway was receiving a red flashing signal. When in the intersection and as he was preparing to make his left turn into U. S. Highway 80 he saw the `Bus' bearing down upon him; he then accelerated his vehicle and sought to continue straight. The right front of the `Bus' hit the rear of the cab of the `Transport' at a point at least 10 feet back of the front bumper. The point of impact was 4 feet west of the intersecting center lines of said highways. The impact was so great the truck loaded with 6 new automobiles was carried upon the southwest curb, breaking a large electric power pole, and the vehicles came to a rest almost side by side on the west side of U. S. Highway 65, 90 feet south of the point of impact. "The `Transport' driver first estimated his speed at the time of entry into the intersection at 6 to 8 miles per hour. When interrogated further, he frankly admitted his speed could have been greater, such as ten, twelve or fifteen miles per hour, but he maintained that he was in second gear and traveling at a speed slow enough 117 to permit him to successfully make the left turn onto U. S. Highway 80. This reasonable and plausible testimony relative to his speed as corroborated by the physical facts has not been refuted by the speculations of the other bus passengers. "It is the opinion of this Court, that by virtue of the customary and legal distinction in the meaning of a flashing red signal and an amber one, the `Transport' driver had the right of way. If for any reason, the fact that the `Transport' driver was faced with an amber flashing signal light, denied him the superior right, then consideration must be given to the facts that the `Transport' entered the intersection first, and the `Bus' approached the intersection to the left of the `Transport'. Counsel have cited an ordinance of the Village of Tallulah designating U. S. Highway 65 as superior to U. S. Highway 80, but in view of the installation of traffic lights, this Court deems the ordinance ineffective. "The Legislature by adoption of the rules of the road in the year 1962 more or less codified the law or general understanding of the meaning of flashing red and amber lights, LSA-R.S. 32:234. The flashing red light means stop and the flashing yellow or amber means caution. "It has been stated elsewhere that: "`A flashing red light is tantamount to a stop sign insofar as the duty of a motorist facing it to stop is concerned.' 164 A.L.R. 93. "Also it has been stated elsewhere that: "`While it is recognized that a flashing yellow light at a street intersection denotes that traffic facing the light must enter the crossing cautiously, it has been held that such a light requires the exercise of no more than ordinary care and it cannot be taken as a prohibition against crossing the intersection in the exercise of ordinary care.' 7 Am.Jur.2d Sec. 210, p. 761. "Since the `Transport' driver enjoyed the right of way at this permanently blind intersection, and was aware of the fact that the traffic on the intersecting highway was receiving a red flashing signal light, this Court exculpates him from blame, fault and negligence herein, relying on the jurisprudence set forth in Koob v. Cooperative Cab Company, 213 La. 903, 35 So.2d 849 (1948) which reads: "`The motorist on the right-of-way street, with knowledge of the location of such a stop sign, has a right to assume that any driver approaching the intersection from the less favored street will observe the law and bring his car to a complete stop before entering the intersection, and such motorist can indulge in this assumption until he sees or should see, that the other car has not observed, or is not going to observe, the law. See Termini v. Aetna Life Ins. Co. et al., La.App., 19 So.2d 286; Kientz v. Charles Dennery, Inc., 209 La. 144, 24 So.2d 292; Glen Falls Ins. Co. v. Copeland, La.App., 28 So.2d 145. See also Mayfield v. Crowdus, 38 N.Mex. 471, 35 P.2d 291; 2 Blashfield, Cyclopedia of Automobile Law and Practice, Perm.Ed., sec. 1032, pp. 216, 217.' "Also relying on the rules set out below: "`Motorist with knowledge of location of stop sign has the right to assume that anyone approaching the intersection controlled by the sign will observe it.' Ellis Electric Co. v. Allstate Insurance Co. [La.App.], 153 So.2d 905. "`A motorist on a right-of-way street with knowledge of the location of a stop sign, has the right to assume that any driver approaching intersection on the less favored street will bring his automobile to a complete stop before entering the intersection, and such motorist can indulge in this assumption until he sees or should see that the other automobile has not observed or is not 118 going to observe the stop sign.' Suhre v. National Union, 244 La. 455 (1963); 152 So.2d 558. "`A motorist who knows that he has right-of-way can assume that the other motorist is cognizant of this rule and will act accordingly.' Theunissen vs. Guidry [La.App.], 151 So.2d 499. "`Motorist who proceeds across intersection on favorable light has right to assume that vehicles traveling in intersecting road-way will stop in obedience to red light.' Emmco Insurance Co. v. Ocean Accident & Guar. Corp. [La. App.], 151 So. 567. "Defendant `Bus' company argues in brief that the speed of the `Transport' when it entered the intersection was 25 to 30 miles an hour as though it was positively established in the trial. The testimony as read by the Court, does not establish any such high speed, instead this Court is impressed with a speed of 6 to 10 miles an hour by the `Transport' at the time of entry into the intersection. "The present case is much stronger than that of Martin vs. New Amsterdam Casualty Co. [La.App.], 97 So.2d 509. In that case the Court in holding that the motorist traveling on a favored highway was free from contributory negligence held: "`Motorist driving on road on which traffic is governed by blinking amber light at intersection has right to assume that driver approaching on intersecting road on which traffic is governed by blinking red light will observe law by bringing his automobile to a full stop before entering intersection, but he cannot indulge in such an assumption if he sees or should see that driver on intersecting road has not observed or cannot observe the law with respect to stopping at the intersection. "`Where a semaphore controlled traffic movement at intersection by blinking amber light facing vehicle on downtown roadway and blinking red lights facing vehicles on inbound roadway, and driver on downtown roadway saw only headlights of inbound automobile which was at right angles to and more than 100 feet from him, failure of driver on downtown roadway to sense or be cognizant of inbound automobile driver's inability to stop, was not negligence and did not bar his recovery from inbound driver for damages resulting from collision.' "Defendant `Bus' company cites and relies on the following cases to show the case at bar is not an ordinary one and that the blinking amber light signaled greater danger requiring greater care: "Wise vs. Prescott, 244 La. 157; 151 So.2d 356; Landrum vs. New Amsterdam Casualty Co., 149 So.2d 182; Bruce vs. Stuyvesant Insurance Co., 159 So.2d 424. "In the Wise and Bruce cases the claimant sued public carriers and in both instances the decisions appeared to hinge upon the rule that a common carrier owed the highest degree of care to pay passengers, and that under the facts in each of the cases the drivers did not exercise the required degree of care, and therefore did not convincingly overcome the prima facie cases of negligence against them. This Court does not accept these two cases as authority to uphold the `Bus' company's contention, especially in view of Judge Bolin's holding in the `Bruce' case when he said: "`Whether this would have amounted to negligence if plaintiff had been a mere guest passenger rather than a fare-paying passenger we are not required to say, but certainly it subjected the carrier to liability under the rule enunciated in Wise v. Prescott, supra.' 159 So.2d 424. "Nor can this Court accept the Landrum case as authority to find the `Transport' driver guilty of negligence, for in that case, although the Court of Appeal believed that the blinking yellow light added an additional 119 duty on the driver approaching on the right-of-way street, it exonerated her even though she entered at a speed of 20 to 25 miles per hour. The `Transport' driver herein was in the relative position of Mrs. Landrum insofar as the blinking lights and right-of-way are concerned and the Court spelled out her duties thus: "`Mrs. Landrum had the duty of proceeding into the intersection with caution at a reasonable rate of speed and also had the duty of looking carefully for the approach of vehicles along the inferior street.' Then later the Court said: "`We do not believe that it was necessary for her to slow her vehicle before entering the intersection, in view of the moderate rate of speed and her knowledge of the location of the stop signs granting her the right-of-way. Since the intersection is a blind one, it is obvious that Mrs. Landrum kept a close lookout and noticed the danger of the approaching vehicle as soon as it was physically possible to do so. We are in accord with the finding of the trial court that Mrs. Landrum was not guilty of any negligence.' Landrum v. New Amsterdam Casualty Co., 149 So.2d 186. "This Court is of the opinion that the `Transport' driver fulfilled his duties. "When the `Bus' driver absolutely ignored the flashing red light and entered this blind intersection at an excessive speed, there would have been but one way to avoid the accident, and that would have been for the `Transport' driver to stop before entering. To require him to stop before entering on a flashing amber signal when he knew the opposing traffic was receiving a red flashing signal is to require the same duties of him as those imposed for a red flashing light. "Accordingly, for the reasons hereinabove stated, and in view of the admission of fault and liability by Continental Southern Lines, Inc., this Court finds the `Bus' company solely liable in the `Ethridge', #4204, `Jolley', #4223 and Auto Transports Inc., now Woods Industries, Inc., Kansas City Division, #4224, cases." Counsel for Mrs. Jolley has seriously urged that the award of $1,000.00 made in her favor should be increased and counsel has furnished references to a large number of citations with respect to allowances for facial scars and disfigurement. Countering this request counsel for Continental Southern Lines, Inc. contends that the examinations made by Doctors A. J. Messina of Vicksburg, Mississippi, Lowell C. Butler and Ralph Riggs of Shreveport, Louisiana, disclose that the injuries to Mrs. Jolley's nose consisted of a deviated septum which was developmental and did not arise as a result of the accident, and further it is argued that the scar on the left side of the nose is healed and left no residuals. The trial judge allowed the sum of $450.00 in accordance with the recommendations made in the report of Dr. Butler dated October 20, 1962. This report recited: "The residual scar on the left side of the nose which extended downward from the level of the eyebrow is still slightly depressed, is quite pale and soft. Sensation in this vicinity is normal and the scar is otherwise little, if any, unchanged from the time of her office visit in October, 1962. Revision of this scar, as previously reported, would require surgical revision under general anesthesia with approximately 48 hours of hospitalization. A combined hospital and medical expenses incurred in this would be $400 to $450." We interpret the medical report as indicating that there will be a facial improvement as a result of the operation. As Mrs. Jolley, according to the record, is a very pretty young matron, we have no doubt that any improvement of a transfiguration upon her face would be most welcome. She testified that she has suffered humiliation 120 as a result of her external nose injury. However, it is indicated that the scar has improved progressively and presented a minimal cosmetic defect at the time of the trial. We conclude that it was proper for the district court to make this allowance. It does appear, however, the trial court in computing the special damages to Mr. Charles Jolley, totaled the amount thereof as being $665.19 whereas the correct sum should be $615.19. The judgment will, therefore, be amended by reducing the award in favor of Charles Jolley to the sum of $615.19. It is our conclusion that the judgment from which appealed and as amended herein is affirmed at appellants' cost.	{ "pile_set_name": "FreeLaw" }
227 F.Supp. 627 (1964) Mauro ALFIERI, t/a Diamond Motors, v. WILLYS MOTORS, INC., and Willys Sales Corporation. Civ. A. No. 28737. United States District Court E. D. Pennsylvania. March 18, 1964. 628 William A. Whiteside, Jr., and Israel Packel, Fox, Rothschild, O'Brien & Frankel, Philadelphia, Pa., for plaintiff. Richard P. Brown, Jr., Morgan, Lewis & Bockius, Philadelphia, Pa., Ritter & Boesel, Toledo, Ohio, for defendants. BODY, District Judge. This is an action which arises under the Act of August 8, 1956, 15 U.S.C.A. §§ 1221-1225, commonly known as the Automobile Dealers' Franchise Act or the Automobile Dealers' Day in Court Act (hereinafter referred to as the Act). Plaintiff, Mauro Alfieri, trading as Diamond Motors, is an automobile dealer; and defendants, Willys Motors, Inc. and Willys Sales Corporation, are automobile manufacturers engaged in commerce under the terms of the aforesaid Act of Congress. Plaintiff alleges in his complaint that on or about August 12, 1955 a "Dealer-Franchise Agreement" was negotiated between plaintiff and defendant, which as subsequently orally modified provided, inter alia, that plaintiff was to be the only Willys dealer located in New Castle County, Delaware; and that the defendants, in violation of the aforesaid Act of Congress, failed to act in good faith in performing and complying with the terms and provisions of the franchise as stated in the following paragraphs: "5. On or about March 1, 1957 defendants did breach its Agreement with plaintiff by establishing another dealer franchise in New Castle County, Delaware; and defendants have had, at all times subsequent thereto, at least one additional dealer franchise in said County. "6. During the latter part of 1957 and the early part of 1958, defendants, in an attempt to dissuade plaintiff from continuing as a dealer and to cause plaintiff to breach the aforesaid Dealer-Franchise Agreement, withheld deliveries of vehicles which plaintiff had ordered and caused plaintiff to lose sales which it otherwise would have `closed'. 629 "7. On or about December 7, 1958, plaintiff's Dealer-Franchise Agreement was canceled because plaintiff threatened legal action to assert his right to be the only Willys Dealer in New Castle County, Delaware and to recover damages suffered by having deliveries withheld. "8. Defendants have, in further violation of the contract, refused to reimburse plaintiff for parts remaining in plaintiff's stock as of the termination date." Thereafter defendants filed this motion for summary judgment stating that no genuine issue of a material fact exists as to any of the above allegations, and that defendants are now entitled to judgment on the pleadings. The deposition of the plaintiff, which was taken on May 13, 1963, has been filed by defendants in support of its motion. The written franchise entered into between plaintiff and defendants, which is entitled "Direct Dealer Agreement", provides, inter alia: "Section 2. Territory of Dealer. "Willys grants to Dealer the privilege of selling at retail the products enumerated in Section 3 of this Agreement in the following described territory but not elsewhere: "`City of Wilmington, Delaware and Vicinity' "Dealer accepts the above selling privilege and agrees to develop with diligence the sales of said products in said territory in accordance with this Agreement." "Section 4. Territory. "* * * Willys reserves the right to sell products to others within the above described territory, either at retail or at wholesale." It is clearly evident from the wording of the franchise agreement that the defendants reserved the right to sell its products to other dealers within that area. A careful review of plaintiff's deposition, pp. 44-76, reveals definitely that plaintiff's contention as to the breach of an exclusive dealer arrangement does not result from the breach of a written agreement but from the breach of an oral undertaking between plaintiff and a representative of Willys. Section 1221(b) of the Automobile Dealers' Franchise Act defines the term "franchise" as: "* * * the written agreement or contract between any automobile manufacturer engaged in commerce and any automobile dealer which purports to fix the legal rights and liabilities of the parties to such agreement or contract." (Emphasis supplied) A study of the legislative history shows that the use by Congress of the word "written" in defining the term "franchise" was not inadvertent but resulted from a careful and deliberate consideration of the entire matter. U.S.Code Cong. and Adm. News 1956, pp. 4596, 4601. "The bill approved by the Senate gives broader meaning to the term `franchise' by including not only the written agreement or contract but also any `understanding or arrangement between any automobile manufacturer and any automobile dealer.' The words `understanding or arrangement' have been deleted in order to safeguard against the possible inclusion of anti-competitive trade arrangements between the manufacturer and the dealer, such as arrangements which might limit the location of new dealers." In view of this it is evident that one of the main objectives of the choice of language by the Legislature was to guard against such oral understandings or agreements upon which the plaintiff relies. Thus all allegations raised by the plaintiff as to the breach of an oral modification of the franchise agreement are without merit. Another purpose of the Act was to assure a dealer the opportunity to secure a judicial determination irrespective of contract terms, as to whether the 630 automobile manufacturer has failed to act in good faith in performing or complying with any of the provisions of his franchise. Section 1221(e) defines "good faith" as: " * * the duty of each party to any franchise, and all officers, employees, or agents thereof to act in a fair and equitable manner toward each other so as to guarantee the one party freedom from coercion, intimidation, or threats of coercion or intimidation from the other party: Provided, That recommendation, endorsement, exposition, persuasion, urging or argument shall not be deemed to constitute a lack of good faith." In Globe Motors, Inc., v. Studebaker-Packard Corporation, 328 F.2d 645 (3d. Cir. 1964) the Court stated: "The statute did not provide a new remedy for breach of contract but created a new cause of action. An indispensable element of the statutory cause of action is not the lack of good faith in the ordinary sense but a lack of good faith in which `coercion, intimidation or threats' thereof are at least implicit." Paragraph 6 of the complaint, alleging withholding of deliveries of vehicles, and Paragraph 7 of the complaint, alleging the cancellation of the franchise, are such assertions that are covered by the "good faith" provision. Sufficient proof is not presented to the Court as to the factual issue of "good faith" demonstrated by the parties in reference to these matters. As to Paragraph 8 of the complaint, alleging refusal by defendants to reimburse plaintiff for remaining parts in stock, a conflicting issue arises as to whether a written demand for reimbursement was made. Plaintiff's deposition states that he believed a written demand was made although the letter from plaintiff's attorney stated that the demand was "apparently verbal". What position plaintiff will assert at time of trial is therefore not clear. If no written demand is produced, the Trial Judge may dismiss the complaint since § 23 of the Dealer-Franchise Agreement expressly states a written demand must be made. Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment shall not be rendered if the pleadings, depositions, answers to interrogatories, and admissions on file, together with affidavits, show that a genuine issue exists as to any material fact. Therefore, the allegations asserted in Paragraphs 6, 7 and 8 are not proper ones to be disposed of by summary judgment at this time. Further disposition of the same is for the determination of the Trial Judge. Plaintiff has raised the question of pendant jurisdiction in his brief and at the time of argument, but did not allege the same in his complaint. Plaintiff's complaint alleged only a claim under the Automobile Dealers Franchise Act; no other claim is asserted under common law or any state statute. Thus, the Court does not find it necessary to discuss the doctrine of pendant jurisdiction and its applicability hereto. ORDER And now, this eighteenth day of March, 1964, it is ordered that defendants' motion for summary judgment with respect to the claim alleged in Paragraph 5 of the plaintiff's complaint be and the same is hereby granted. It is further ordered that defendants' motion for summary judgment with respect to the claims alleged in Paragraphs 6, 7 and 8 of the plaintiff's complaint be and the same is hereby denied.	{ "pile_set_name": "FreeLaw" }
574 F.Supp.2d 801 (2008) UNITED STATES of America, Plaintiff, v. Samuel D. FRANCE, Defendant. No. 1:08-cr-067. United States District Court, W.D. Michigan, Southern Division. September 3, 2008. 802 Matthew G. Borgula, U.S. Attorney, Grand Rapids, MI, for Plaintiff. OPINION AND ORDER OVERRULING DEFENDANT'S OBJECTION TO PRESENTENCE REPORT PAUL L. MALONEY, Chief Judge. Defendant Samuel France pleaded guilty to distribution of fifty grams or more of a controlled substance, a violation of 21 U.S.C. § 841(a)(1). Defendant has a 1991 felony conviction for delivering a controlled substance. In 1992, Defendant pleaded guilty to assault with the intent to commit criminal sexual conduct involving penetration, a violation of MCL § 750.520g(1). Defendant objects to being sentenced as a career offender under the Sentencing Guidelines. Defendant argues his assault conviction does not constitute a crime of violence under USSG § 4B1.1. Defendant cites, as authority, United States v. Bartee, 529 F.3d 357 (6th Cir. 2008) and United States v. Arnold, 58 F.3d 1117 (6th Cir.1995). I. SENTENCING GUIDELINES In order to be sentenced as a career offender, the sentencing guidelines provide (1) the defendant must be at least 18 years old when the instant offense was committed, (2) the instant offense is either a crime of violence or a controlled substance offense, and (3) the defendant has at least two prior felony convictions for either a crime of violence or a controlled substance offense. USSG § 4B1.1(a). Under the sentencing guidelines, the phrase "crime of violence" means any offense under state or federal law punishable by imprisonment for more than one year and (1) has as an element the use, attempted use, or threatened use of physical force against the person of another, or (2) is a burglary of a dwelling, arson, or extortion, involves the use of explosives, or otherwise involves 803 conduct that presents a serious potential risk of physical injury to another. USSG § 4B1.2(a). The commentary under section 4B1.2 provides useful insight. A crime of violence includes offenses for attempting to commit a crime of violence. USSG § 4B1.2 cmt. n. 1 (2007). Furthermore, "Crime of violence" includes murder, manslaughter, kidnapping, aggravated assault, forcible sex offenses, robbery, arson, extortion, extortionate extension of credit, and burglary of a dwelling. Other offenses are included as `crimes of violence' if (A) that offense has as an element the use, attempted use, or threatened use of physical force against the person of another, or (B) the conduct set forth (i.e., expressly charged) in the count of which the defendant was convicted involved the use of explosives (including any explosive material or destructive device) or, by its nature, presented a serious potential risk of physical injury to another. Id.[1] Thus, there are three ways by which a prior conviction will be considered a crime of violence under the Guidelines: (1) the prior conviction is for a crime specifically enumerated in the application notes, (2) the prior conviction is for a crime that, although not specifically enumerated, has as an element of the offense, the use, attempted use or threatened use of physical force, or (3) the prior conviction is for a crime that, although neither specifically enumerated nor involving physical force as an element of the offense, involves conduct posing a serious potential risk of physical injury to another (the residual clause). United States v. Arnold, 58 F.3d 1117, 1121 (6th Cir.1995) (quoting United States v. John, 936 F.2d 764, 767 (3d Cir.1991)). The United States Supreme Court has directed sentencing courts to use a "categorical approach" when determining a defendant's eligibility for career offender status. Taylor v. United States, 495 U.S. 575, 110 S.Ct. 2143, 109 L.Ed.2d 607 (1990). Under this categorical approach, a sentencing court looks only to the statutory definitions of the prior offenses and not the particular facts underlying those convictions to determine whether a prior offense qualifies as a predicate offense for a sentence enhancement. Id. at 602, 110 S.Ct. 2143. Only when the statutory language of the prior crime encompasses both violent and nonviolent behavior may the sentencing court look beyond the statutory language to determine whether the defendant's specific conduct amounted to a crime of violence. Id. Where the defendant was convicted by a jury for his prior crime, the sentencing court may consider the charging document and the jury instructions. Id. Where the prior conviction was secured pursuant to a plea, the sentencing court may consider the terms of the plea agreement, the transcript of the colloquy between the judge and the defendant where the factual basis for the plea was secured, or some comparable judicial record of the information. Shepard v. 804 United States, 544 U.S. 13, 22, 125 S.Ct. 1254, 161 L.Ed.2d 205 (2005). See also Gonzales v. Duenas-Alvarez, 549 U.S. 183, 189, 127 S.Ct. 815, 166 L.Ed.2d 683 (2007) (clarifying Shepard's holding that where a conviction is obtained pursuant to a plea, the sentencing court may consider documents outlined in Taylor as well as those documents relevant to the plea agreement). II. MICHIGAN STATUTE AS A CATGORICAL CRIME OF VIOLENCE In Michigan, the crime of assault with intent to commit criminal sexual conduct is defined at MCL § 750.520g. The statute provides (1) Assault with intent to commit criminal sexual conduct involving sexual penetration shall be a felony punishable by imprisonment for not more than 10 years. (2) Assault with intent to commit criminal sexual conduct in the second degree is a felony punishable by imprisonment for not more than 5 years. MCL § 750.520g(1). The elements of assault with intent to commit criminal sexual conduct were first outlined in People v. Snell, 118 Mich.App. 750, 325 N.W.2d 563, 566 (1982).[2] The issue on appeal concerned the elements of the assault with the intent to commit criminal sexual conduct statute, MCL § 750.520g. The court looked at statutory definitions and relevant case law. Id. The court provided the following description of the elements of the statute. Specifically, the elements of assault with intent to commit CSC are as follows: (1) There must be an assault. (2) There must be a sexual purpose. When the act involves penetration, defendant must have intended the act involving some sexually improper intent or purpose. When the act involves contact, defendant must have intended the act for the purpose of sexual arousal or sexual gratification. (3) When the act involves penetration, the intended sexual act must have been one involving some actual entry of another person's genital or anal openings or some oral sexual act. When the act involves contact, defendant must have specifically intended to touch the complainant's genital area, inner thigh, buttock, breast or clothing covering those areas, or defendant must have specifically intent to have the complainant touch such area on him. (4) There must be some aggravating circumstances, e.g., the use of force or coercion. An actual touching is not required. When the act involves penetration, it is not necessary to show that the sexual act was started or completed. Id. (emphasis added). The court identified the last element as "some aggravating circumstances, e.g., the use of force or coercion." Id. The signal "e.g." is latin for "exempli gratia" or "for example." Force or coercion is one of the circumstances listed under the CSC first statute. See MCL § 750.520b(1)(f). It is noteworthy that CSC first and third, violations of MCL § 750.520b and 520d respectively, involve criminal sexual conduct involving sexual penetration and some other circumstance, while CSC second, a violation of MCL § 750.520c, involves sexual contact and some other circumstance. The criminal sexual assault statute, MCL § 750.520g(1), thus criminalizes the crime of assault with the intent to commit CSC first and CSC third. More recently, the Michigan Supreme Court held, to establish a violation of section 805 520g(1), the prosecutor must show (1) an assault occurred with (2) an intent to commit criminal sexual conduct involving sexual penetration. Michigan v. Starks, 473 Mich. 227, 701 N.W.2d 136, 140 (2005) (quoting Michigan v. Nickens, 470 Mich. 622, 685 N.W.2d 657 (2004)). The court explained how the assault element might be established. The prosecutor might show either (1) an attempt to commit a battery (attempted-battery assault) or (2) an unlawful act that places another in reasonable apprehension of receiving an immediate battery (apprehension-type assault). Id. A battery is an intentional, unconsented and harmful or offensive touching of the person or another. Id. (quoting Michigan v. Reeves, 458 Mich. 236, 580 N.W.2d 433, 435 n. 4 (1998)). "[W]hen one attempts an intentional, unconsented, and harmful or offensive touching of a person, one has committed an assault." Id. ANALYSIS Defendant France meets the first two requirements under USSG § 4B1.1(a) to be sentenced as a career offender. Defendant is over 18 years of age and he has pleaded guilty to a controlled substance offense. Defendant's 1991 controlled substance offense counts as one prior felony conviction under the career offender guidelines. Defendant's 1992 sexual assault conviction will count as a second conviction for the purposes of enhancing his sentence as a career offender if the conviction is for (1) a crime specifically enumerated in the application notes, (2) a crime that has, as an element, the use, attempted use or threatened use of force, or (3) a crime that involves conduct posing a serious potential risk of physical injury to another. See Arnold, 58 F.3d at 1121. For purposes of this opinion, the Court first assumes, as Defendant asserts, that under the categorical approach, Michigan's sexual assault statute does not clearly constitute a crime of violence under either the first or second ways in which a crime may be considered a crime of violence under the Sentencing Guidelines. Second, Michigan's sexual assault statute does not clearly fall under one of the crimes enumerated in the advisory comment as it is not clearly a "forcible sex crime." Third, the statute also does not necessarily involve the use, attempted use or threatened use of force.[3] Fourth, in Michigan, an assault need not include the use of force. An assault may be an attempt or apprehension of an unconsented harmful or offensive touching. See Starks, 701 N.W.2d at 140. Nevertheless, the crime to which Defendant pleaded guilty does, however, constitute a crime of violence. Under the residual clause, a sentencing court must determine whether the crime involves conduct posing a serious potential risk of physical injury. Still using the categorical approach, a sentencing courts must "consider whether the elements of the offense are of the type that would justify its inclusion within the residual provision, without inquiring into the specific conduct of this particular offender." James v. United States, 550 U.S. 192, 127 S.Ct. 806 1586, 1594, 167 L.Ed.2d 532 (2007) (emphasis in original). The Supreme Court explained [o]ne could, of course, imagine a situation in which attempted burglary might not pose a realistic risk of confrontation or injury to anyone.... But the ACCA does not require metaphysical certainty. Rather, § 924(e)(2)(B)(ii)'s residual provision speaks in terms of a "potential risk." These are inherently probabilistic concepts. Indeed, the combination of the two terms suggests that Congress intended to encompass possibilities even more contingent or remote than a simple "risk," much less a certainty. * * James' argument also misapprehends Taylor's categorical approach. We do not view that approach as requiring that every conceivable factual offense covered by statute must necessarily present a serious potential risk of injury before the offense can be deemed a violent felony. Rather, the proper inquiry is whether the conduct encompassed by the elements of the offense, in the ordinary case, presents a serious potential risk of injury to another. One can always hypothesize unusual cases in which even a prototypically violent crime might not present a genuine risk of injuryfor example an attempted murder where the gun, unbeknownst to the shooter, had no bullets. Or, to take an example from the offenses specifically enumerated in § 924(e)(2)(B)(ii), one could imagine an extortion scheme where an anonymous blackmailer threatens to release embarrassing personal information about the victim unless he is mailed regular payments. In both cases, the risk of physical injury to another approaches zero. But that does not mean that the offenses of attempted murder or extortion are categorically nonviolent. As long as an offense is of a type that, by its nature, presents a serious potential risk of injury to another, it satisfies the requirements of § 924(e)(2)(B)(ii)'s residual provision. Id. at 1597 (citations and footnotes omitted). See also United States v. Westerfield, Nos. 07-3376 and 07-3438, 2008 WL 2796057 at 7 (6th Cir. Jul. 21, 2008) (Griffin, J.) (finding the Ohio abduction statute, even though the crime could be committed without the use of violence, targeted conduct that, by its nature, presented a serious potential risk of injury to another). Assault with the intent to commit criminal sexual conduct involving penetration, is an offense that, by its nature, presents a potential risk of injury to another. In the ordinary case, the elements establishing the crime will demonstrate conduct presenting a serious potential risk of injury to another. Although it may be possible to commit assault with intent to commit criminal sexual conduct involving penetration without the use of violence, that is not the ordinary application of the statute. Defendant argues that the statute is ordinarily used to prosecute attempted statutory rape so that it is not a mere possibility, but a real probability, that the statute applies to nonviolent offenses. See Starks, 701 N.W.2d at 140. Although Defendant attempts to distinguish various cases, the overwhelming authority from the Sixth Circuit holds sexual offenses involving victims who are minors constitute crimes of violence. See United States v. Hargrove, 416 F.3d 486 (6th Cir.2005); Unites States v. Campbell, 256 F.3d 381 (6th Cir.2001); United States v. Champion, 248 F.3d 502 (6th Cir.2001); United States v. Arnold, 92 F.3d 1186, 1996 WL 435276 (6th Cir. Aug. 1, 1996) (unpublished table opinion). III. SIMILARITY TO ENUMERATED CRIMES IN THE RESIDUAL CLAUSE In order to conclude a crime poses a serious potential risk of physical injury 807 under the residual clause, the crime must be roughly similar to the enumerated crimes "in kind as well as in degree of risk posed." Begay v. U.S., ___ U.S. ___, 128 S.Ct. 1581, 1585, 170 L.Ed.2d 490 (2008); Bartee, 529 F.3d at 363. In rejecting the proposition that New Mexico's driving under the influence statute was a crime of violence under the residual clause, the Supreme Court noted the crime arose under a strict liability statute, unlike the enumerated crimes. Begay, 128 S.Ct. at 1586-1587. To determine whether a crime is "in kind" to the listed offenses, the Supreme Court directed sentencing courts to consider whether the crime involves purposeful, violent, and aggressive conduct. Id.; United States v. Williams, 529 F.3d 1, 7 (1st Cir.2008). The First Circuit concluded the crime of interstate transportation of a minor for prostitution constituted a crime of violence under the residual clause. Id. at 8. The court concluded that illicit sexual activity between an adult and a minor posed a significant risk that force would be used during the commission of the crime. Id. at 5. The court also concluded there was a "strong argument for treating the transportation of a minor for prostitution as a violent crime" because "unlike DUI, the crime is purposeful and the perpetrator is aware of the risks that the prostituted minor will face." Id. at 7. The crime of assault with intent to commit criminal sexual conduct involving penetration is sufficiently similar in kind and has a similar degree of risk to the listed crimes as to constitute a crime of violence. As noted by the First Circuit in Williams, the adjectives "purposeful" and "aggressive" are imprecise aids. 529 F.3d at 7. Similar to the listed crimes, assault is a specific intent crime. In addition to the assault, the defendant must have the specific intent to sexually penetrate. Such conduct, the assault with the intent to sexually penetrate the victim, is both purposeful and aggressive. In the ordinary case, although certainly not in every possible case, the crime of assault involves violent conduct. In the ordinary case, although certainly not in every possible case, criminal sexual conduct involving penetration also involves violent behavior. This Court concludes such the risk to the victim inherent in such conduct is sufficient in degree of risk to the listed crimes. Accordingly, the crime to which Defendant pleaded guilty is sufficiently similar to the enumerated crimes under the residual clause and constitutes a crime of violence. IV. CONCLUSION Defendant France may be sentenced as a career offender under section 4B1.1 of the Sentencing Guidelines. Under the categorical approach, the crime to which Defendant France pleaded guilty constitutes a crime of violence. The elements of assault with intent to commit criminal sexual conduct involving sexual penetration, at the very least, involve conduct that ordinarily pose a serious potential risk of physical injury to the victim. Although there may be ways of committing the crime that do not pose a serious potential risk, such crimes are not ordinary probabilities, but extraordinary possibilities. In addition, the kind of risk and degree of risk to the victim are sufficiently similar to the crimes enumerated in the residual clause to conclude that the crime is a crime of violence.[4] NOTES [1] The advisory note uses language very similar to that used the Armed Career Criminal Act (ACCA), 18 U.S.C. § 924(e)(2)(B). Courts considering the career offender enhancement under the Sentencing Guidelines have held the provision is functionally identical to the ACCA, and there is no basis for reading the two differently. United States v. Bartee, 529 F.3d 357, 359 (6th Cir.2008) (holding the categorical approach for determining whether a crime constitutes a "violent felony" under the ACCA has been applied to the determination of whether a crime constitutes a "crime of violence" under section 4B 1.2(a) of the Sentencing Guidelines) (citing United States v. Arnold, 58 F.3d 1117, 1121 (6th Cir.1995).) See also United States v. Williams, 537 F.3d 969, 971-72 (8th Cir.2008) (holding the circuit has never recognized a distinction between the phrase "crime of violence" under the Guidelines and the phrase "violent felony" under the ACCA). [2] In Snell, the defendant was charged with assault with intent to commit criminal sexual conduct involving sexual penetration, a violation of MCL § 750.520(g)(1), but was convicted of assault with intent to commit criminal sexual conduct in the second degree, a violation of MCL § 750.520(g)(2). 325 N.W.2d at 566. [3] There is Sixth Circuit authority leading to a contrary conclusion. See United States v. Bass, 274 Fed.Appx. 443, 449 (6th Cir.2008) ("It is abundantly clear from the charge itself, specifically from the use of the term `assault,' that the prior conviction was for a crime of violence, either because it was `an [] offense... that has as an element the use, attempted use, or threatened use of force against the person of another,' USSG § 4B1.2(a)(1), or because, at the very least, it `involves conduct that presents a serious potential risk of physical injury to another.' USSG § 41.2(a)(2)."); United States v. Perez-Velasquez, 67 Fed.Appx. 890, 892 (6th Cir.2003) (holding, in the context of USSG § 2L1.2, that "sexual penetration of a minor without legally cognizable consent is necessarily `forcible.'"). [4] Having so concluded, the Court will not address the government's other arguments that there are additional reasons why Defendant's prior conviction should be classified as a crime of violence.	{ "pile_set_name": "FreeLaw" }
J-S13022-17 NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37 COMMONWEALTH OF PENNSYLVANIA IN THE SUPERIOR COURT OF PENNSYLVANIA Appellee v. DAIYCHELLE ATKINSON Appellant No. 1562 EDA 2016 Appeal from the Order August 3, 2015 In the Court of Common Pleas of Philadelphia County Criminal Division at No(s): MC-51-CR-0001158-2013 BEFORE: BENDER, P.J.E., LAZARUS, J., and FITZGERALD, J.* MEMORANDUM BY LAZARUS, J.: FILED SEPTEMBER 29, 2017 Daiychelle Atkinson appeals from the trial court’s order denying her motion to dismiss1 based on the compulsory joinder principles of section 110 of the Crimes Code. 2 We affirm. ____________________________________________ * Former Justice specially assigned to the Superior Court. 1 We note that because “the protection of the compulsory joinder of charges statute is in the nature of protection against double jeopardy, an order denying a motion to invoke that statute's protection is . . . subject to immediate appeal.” Commonwealth v. Barber, 940 A.2d 369, 376 (Pa. Super. 2007) (citations omitted). 2 The compulsory joinder rule states, in relevant part: Although a prosecution is for a violation of a different provision of the statutes than a former prosecution or is based on different facts, it is barred by such former prosecution under the following circumstances: J-S13022-17 On January 8, 2013, Atkinson was arrested and charged with driving under the influence (DUI), 75 Pa.C.S. § 3802, as well as a violation of the Motor Vehicle Code (MVC) for disregarding a traffic device, 75 Pa.C.S. § 3111(a). On March 13, 2013, Atkinson was found guilty by the Philadelphia Traffic Court of the offense of disregarding a traffic device. No appeal was filed. The Commonwealth continued its prosecution of the DUI offense in the Criminal Trial Division in Philadelphia. On August 3, 2015, Atkinson filed a motion to dismiss the DUI offense, in the Municipal Court, pursuant to 18 Pa.C.S. § 110, the compulsory joinder rule. The Municipal Court denied Atkinson’s motion to dismiss. Atkinson filed an interlocutory appeal from that order to the Philadelphia Court of Common Pleas. On October 23, 2015, the trial court affirmed the ____________________________________________ (1) The former prosecution resulted in an acquittal or in a conviction . . . and the subsequent prosecution is for: (i) any offense of which the defendant could have been convicted on the first prosecution. (ii) any offense based on the same conduct or arising from the same criminal episode, if such offense was known to the appropriate prosecuting officer at the time of the commencement of the first trial and occurred within the same judicial district as the former prosecution unless the court ordered a separate trial of the charge of such offense[.] 18 Pa.C.S. § 110(1)(ii) (amended 2002) (emphasis added). -2- J-S13022-17 Municipal Court’s denial of Atkinson’s motion to dismiss. On November 23, 2015, Atkinson filed a timely notice of appeal to this Court. She raises the following issue for our review: Did not the lower court err in denying [Atkinson]’s motion to dismiss pursuant to 18 Pa.C.S. § 110(a)(1)(ii)[,] where [Atkinson] had previously been convicted of offenses which arose from the same criminal episode in the same judicial district as the offense in the instant case?3 Notwithstanding the “occurred within the same judicial district” language found in section 110(1)(ii), at the time Atkinson was charged and found guilty of the MVC offense in Traffic Court, the Municipal Court lacked jurisdiction to hear both her summary and DUI offenses.4 Simply put, the Municipal Court did not have the jurisdictional authority to adjudicate Atkinson’s MVC offense. The Commonwealth had no choice but to prosecute Atkinson of the summary offense in Traffic Court where there was a jurisdictional bar precluding it from prosecuting her at that time for all offenses ____________________________________________ 3 Our standard of review of issues concerning section 110 is plenary. Commonwealth v. Reid, 35 A.3d 773, 776 (Pa. Super. 2012). 4 We recognize that on June 19, 2013, the Philadelphia Traffic Court was effectively abolished when the General Assembly restructured the Philadelphia Municipal Court, now comprised of two administrative sections, the General Division and the Traffic Division. See Act 17 of 2013, P.L. 55, No. 17 (June 19, 2013). Thereafter, all Traffic Court responsibilities were transferred to the Municipal Court. -3- J-S13022-17 in one proceeding. Thus, there is no Rule 110 bar to the instant prosecution. Accordingly, the trial court properly dismissed Atkinson’s Rule 110 motion. Order affirmed.5 Judgment Entered. Joseph D. Seletyn, Esq. Prothonotary Date: 9/29/2017 ____________________________________________ 5 Recently, in Commonwealth v. Perfetto, 2017 PA Super 281 (Pa. Super. filed August 30, 2017) (en banc), our full Court held that barring certain judicial exceptions, “the subsequent prosecution of an offense arising out of a criminal episode that had triggered the former prosecution of a different offense is barred where those multiple offenses occur in the same judicial district.” Id. at 1. However, where the prosecutions occur in Philadelphia County, like in Perfetto, “all summary traffic offenses may be disposed of in a single proceeding in the traffic court separately from other criminal charges without violating the compulsory joinder rule.” Id. at 13. The Perfetto Court observed that in the unique context of Philadelphia, the Supreme Court of Pennsylvania has allocated disposition of summary traffic offenses solely to the Philadelphia Municipal Court Traffic Division. Id. Perfetto, however, is distinguishable because the defendant in that case was charged, prosecuted and convicted of the summary offense in Traffic Court after the Municipal Court was restructured and had jurisdiction to adjudicate his Title 75 summary offense. In the present case the statutory amendment did not occur until after Atkinson was charged, prosecuted and convicted in Traffic Court of the summary offense under section 3111(a); therefore, unlike Perfetto, the Commonwealth was not able to prosecute both types of offenses together in Municipal Court. See Perfetto, at *31 (Dubow, J., dissenting) (“once the legislature abolished Traffic Court and transferred jurisdiction of summary traffic offenses to Municipal Court, one single court had jurisdiction to adjudicate both summary and misdemeanor traffic offenses.”). -4-	{ "pile_set_name": "FreeLaw" }
United States Court of Appeals, Eleventh Circuit. No. 95-8107. Robert D. MASTROIANNI, Plaintiff-Appellee, v. Michael J. BOWERS, Patrick D. Deering, Joe B. Jackson, Jr., Weyland Yeomans, Defendants-Appellants. Jan. 5, 1996. Appeal from the United States District Court for the Southern District of Georgia. Before HATCHETT and BIRCH, Circuit Judges, and GODBOLD, Senior Circuit Judge. (No. CV293-88), Anthony A. Alaimo, Judge. HATCHETT, Circuit Judge: We dismiss this appeal based on the teachings of Johnson v. Jones, --- U.S. ----, 115 S.Ct. 2151, 132 L.Ed.2d 238 (1995). BACKGROUND Appellants Michael J. Bowers, Attorney General of Georgia, Patrick D. Deering, Assistant Attorney General of Georgia, and Georgia Bureau of Investigation (GBI) Agents Joe B. Jackson Jr., Weyland Yeomans, and Lee J. Sweat, Jr. conducted an investigation into alleged misconduct of Camden County Sheriff William E. Smith and Deputy Sheriff Robert Mastroianni. Bowers supervised the investigation that lasted from the spring of 1991 to the summer of 1992. The investigation of Mastroianni stemmed from allegations that he planted drugs on criminal suspects and then falsely arrested them. Mastroianni believed, however, that the goal of the investigation was to damage the reputation of Sheriff Smith's department. On July 1, 1992, Deering filed a notice of indictment against Mastroianni, and grand jury proceedings occurred on July 16 and 17. The grand jury indicted Mastroianni on one count for planting drugs on and falsely arresting a suspect. Law enforcement officials arrested Mastroianni on July 17 and took him to the Glenn County Jail where he was booked and subsequently released on a $5,000 bond the same day. Mastroianni was on bond with restricted freedom of movement until April 9, 1993, when Deering and Bowers formally declared that they would not seek to prosecute Mastroianni. On June 29, 1993, Mastroianni filed a complaint in the Southern District of Georgia against Bowers, Deering, Yeomans, Jackson, and Sweat for allegedly violating the Civil Rights Act of 1 1871, 42 U.S.C. § 1983. Mastroianni sought compensatory and punitive damages. In his complaint, Mastroianni alleged that appellants conspired to violate his constitutional rights to be free from malicious prosecution, bad-faith prosecution, abuse of process, knowing use of false and perjured testimony, deprivation of a fair trial and false arrest. Mastroianni claimed that the appellants violated his civil rights because he refused to assist them with an ongoing investigation of Sheriff Smith. Appellants filed a motion to dismiss on August 2, 1993, and on September 20, 1993. The district court granted appellants' motion to dismiss with respect to Mastroianni's claims for deprivation of fair trial, use of false and improperly obtained evidence, and use of perjured testimony. The district court reasoned that Mastroianni could not maintain a fair trial claim in the absence of 1 Mastroianni subsequently moved to have Sweat dismissed from this action. The district court granted Mastroianni's motion on July 20, 1994. a trial. The district court dismissed the claims for use of false and improperly obtained evidence and perjured testimony because it determined that those claims were indistinguishable from claims of malicious prosecution, abuse of process, and false arrests. The district court, however, denied the appellants' motion to dismiss with respect to Mastroianni's constitutional claims in the nature of malicious prosecution, abuse of process, false arrest, false imprisonment and conspiracy to commit the same. The district court found that Mastroianni had pleaded sufficient facts to state a claim upon which relief could be granted. In September 1994, appellants filed a motion for summary judgment claiming that they were entitled to both qualified and absolute immunity. The district court denied appellants' motion for summary judgment on the claims for false arrest and conspiracy to commit false arrest, but granted their motion on the claims for false imprisonment, abuse of process, malicious prosecution, and conspiracy to commit the foregoing. The district court held that Mastroianni's claims of false imprisonment and malicious prosecution were part of his broader claim of false arrest. The district court also found that the tort of "abuse of process" was not clearly established law in this circuit at the time of the arrest. The district court found that the appellants violated clearly established law when they arrested Mastroianni without probable cause. This appeal is from the denial of the summary judgment motion based on qualified immunity. DISCUSSION When a lower court denies a motion for summary judgment based on qualified immunity, this court has interlocutory appellate jurisdiction. Mitchell v. Forsyth, 472 U.S. 511, 530, 105 S.Ct. 2806, 2817-18, 86 L.Ed.2d 411 (1985). According to Mitchell, this court may properly entertain an interlocutory appeal from a district court's denial of a defendant's motion for summary judgment when (1) the defendant is a public official claiming qualified immunity as a defense, and (2) the issue on appeal is whether the undisputed facts show a violation of clearly established law. Mitchell, 472 U.S. at 528, 105 S.Ct. at 2816-17. Insofar as appeals from denials of summary judgment relate to "factual disputes" or "sufficiency of evidence" regarding the plaintiff's claim, this court lacks appellate jurisdiction. Johnson v. Jones, --- U.S. ----, ----, 115 S.Ct. 2151, 2156, 132 L.Ed.2d 238 (1995); Babb v. Lake City Community College, 66 F.3d 270, 272 (11th Cir.1995). Therefore, in light of the recent Supreme Court decision in Johnson and this court's decision in Babb, interlocutory appellate review of denial of summary judgment motions on the grounds of qualified immunity is confined to determining whether the law supposedly violated was clearly established. Johnson, --- U.S. at ----, 115 S.Ct. at 2156; Babb, 66 F.3d at 272. When a district court finds that genuine issues of material fact exist regarding the "conduct" alleged to have violated clearly established law, this court is without appellate jurisdiction. Babb, 66 F.3d at 272. The district court in this case found that genuine issues of material fact exist surrounding appellants' alleged illegal conduct leading to Mastroianni's arrest. Moreover, the appellants did not challenge the district court's determination of the clearly established law allegedly violated. Therefore, this court may not properly exercise jurisdiction. CONCLUSION This appeal is dismissed for lack of jurisdiction. DISMISSED.	{ "pile_set_name": "FreeLaw" }
499 P.2d 1206 (1972) Lionel VARELA, Plaintiff-Appellant, v. The COLORADO MILLING & ELEVATOR COMPANY, a Colorado corporation, Defendant-Appellee. No. 71-298. Colorado Court of Appeals, Div. II. May 23, 1972. Rehearing Denied June 13, 1972. Certiorari Denied August 28, 1972. Daniel S. Hoffman, Gerald P. McDermett, Denver, for plaintiff-appellant. Paul D. Renner, Denver, for defendant-appellee. Selected for Official Publication. SMITH, Judge. Plaintiff, Lionel Varela, was an employee of Epcon, Inc., an electrical contractor. Defendant, The Colorado Milling & Elevator Company, contracted with Epcon for continuing maintenance and repair of a neon sign located on defendant's premises. On October 19, 1967, during the term of the maintenance agreement, plaintiff was sent by his employer, Epcon, to the defendant's premises to work on the sign pursuant to the agreement. While on the premises of defendant, the plaintiff was seriously injured when a mishap occurred involving an elevator in which the plaintiff was riding. After receiving compensation and medical benefits from Epcon's workmen's compensation carrier, plaintiff brought suit for damages based upon the alleged negligence of the defendant. The answer of defendant alleged the prohibition of C.R.S.1963, 81-9-2(2), as an absolute defense to plaintiff's action. Defendant's motion for summary judgment of dismissal on that ground was subsequently filed and granted. From 1207 that judgment plaintiff appeals. The judgment of dismissal is affirmed. Initially, plaintiff asserts that the granting of summary judgment under C.R. C.P. 56 by the trial court was error as there existed a genuine issue of material fact in dispute. Plaintiff and defendant submitted separate affidavits, each signed and sworn to by one Wilbur Rusch, the Division Manager of Epcon. Plaintiff claims these affidavits are contradictory and give rise to the issue of fact. When read together, there is no conflict in meaning between the affidavits. Plaintiff's affidavit states that Epcon hired, or used, approximately twelve employees in performing the maintenance agreement. In the defendant's affidavit, the affiant more specifically stated that on any one occasion, no more than three employees had worked on the repair or maintenance of the sign in question. This does not present an issue of fact such as would prevent a summary judgment. The fact that at no time were there more than three employees working on the defendant's sign, although Epcon employs more than four employees, forms the basis for the primary contention of error. The plaintiffs argue that the trial court found Epcon had attained "employer" status on the basis of C.R.S.1963, 81-9-2, and that the statute was incorrectly construed. The plaintiff's theory is that C.R.S.1963, 81-9-2, defines "employer" in dealing specifically with a particular situation, and, therefore, the general provision of C.R.S.1963, 81-2-6, defining an "employer" as any corporation with four or more employees or any employer who elects to accept the provisions of the Workmen's Compensation Act, is not applicable to this situation. Therefore, even though Epcon has more than four employees, plaintiff claims that because Epcon had less than four employees on this specific job, Epcon is not an "employer" under the Act. If this were true, plaintiff would be correct in asserting that its action is not barred by C.R.S.1963, 81-9-2(2). In resolving this issue, we must look closely at the language of C.R.S.1963, 81-9-2: (1) Every person, company, or corporation, that owns any real property or improvements thereon and that contracts out any work done on and to said property to any contractor, subcontractor, person, or persons, who shall hire or use four or more employees or workmen, including himself if working thereon in the doing of such work, shall be deemed to be an employer under the terms of this chapter and every such contractor, and subcontractor, person, or persons, as well as their employees, shall each and all of them be deemed to be employees as defined in this chapter and such employer shall be liable as provided in this chapter to pay compensation for injury or death resulting therefrom to said contractor, and subcontractor, and their employees and, before commencing said work, shall insure and shall keep insured his liability as provided in this chapter. Such employer shall be entitled to recover the cost of such insurance from said contractor, subcontractor, person, or persons, and may withhold and deduct the same from the contract price or any royalties or other money due, owing, or to become due said contractor, subcontractor, person, or persons. (2) If said contractor, subcontractor, person, or persons doing or undertaking to do any work for an owner of property, as provided in subsection (1) of this section, shall himself be an employer, as defined in this chapter, in the doing of such work and shall before commencing such work insure and shall keep insured his liability for compensation as provided in this chapter, neither said contractor, subcontractor, person, or persons, its employees or its insurers, shall have any right of contribution or action of any kind including actions under section 81-13-8, herein against the person, company, or corporation owning real property and improvements thereon which contracts out work done on said property. 1208 Plaintiff argues that the language providing that a landowner who contracts work to "any contractor, subcontractor, person, or persons, who shall hire or use four or more employees or workmen, including himself if working thereon in the doing of such work, shall be deemed to be an employer under the terms of this chapter. . ." means that, in order for a landowner to be deemed an employer, four employees must be used on a specific job on the property of the landowner. Plaintiff's argument, however, does not take cognizance of the basic structure of the statute. C.R.S.1963, 81-9-2(1), defines the circumstances under which a landowner is deemed to be an "employer", while C.R.S.1963, 81-9-2(2), defines the circumstances under which a contractor working on the landowner's property is an "employer". If either the landowner or the contractor qualifies as an "employer" under Chapter 81, then the statute is clear that where the "employer" insures and keeps insured his liability under the Act, then the landowner shall not be subject to common-law actions initiated by an employee of the contractor. The language plaintiff cites from C.R.S. 1963, 81-9-2(1), specifies the circumstances under which a contractor with three employees shall himself be counted as an employee in determining if a landowner shall be an "employer" under the Act. However, this portion of the statute is not relevant to the issue here. The trial court determined that since the contractor, Epcon, was an "employer" by the terms of Chapter 81, no action initiated by the contractor's employee, Varela, could be brought against the landowner, The Colorado Milling & Elevator Company. The trial court's construction of C.R.S. 1963, 81-9-2, is in accord with public policy as declared by the legislature and the case law that has dealt with the statute. Great Western Sugar Co. v. Erbes, 148 Colo. 566, 367 P.2d 329, held that immunity was not provided a landowner under an earlier statute, C.R.S. '53, 81-9-2, even though a contractor working on his land was an "employer" under the Act and had insured the injured employee because the statute contained no express limitation of the common law remedy. In Alexander v. Morrison-Knudsen Co., 166 Colo. 118, 444 P.2d 397, the court noted that after Erbes the General Assembly amended C.R.S. '53, 81-9-2, and that the language of the amended law frees the landowner from liability to the injured workman where the contractor insures and keeps insured his liability for compensation. See Nicks v. Electron Corp., 29 Colo.App. 114, 478 P.2d 683. Epcon was a corporation with four or more employees that insured and kept insured its liability for compensation under the Workmen's Compensation Act. By provision of Chapter 81, more specifically, C.R.S.1963, 81-2-6, Epcon gained "employer" status under the Act. By provision of C.R.S.1963, 81-9-2, as properly construed by the trial court, neither Epcon, nor its employee, Varela, has an action against the defendant, The Colorado Milling & Elevator Company. Judgment affirmed. COYTE and ENOCH, JJ., concur.	{ "pile_set_name": "FreeLaw" }
847 F.2d 835 Pattersonv.Smith NO. 87-2516 United States Court of Appeals,Second Circuit. APR 12, 1988 1 Appeal From: W.D.N.Y. 2 AFFIRMED.	{ "pile_set_name": "FreeLaw" }
234 S.W.3d 875 (2006) David HARRIS, Appellant, v. CITY OF FORT SMITH, Bill Harding, C. Ray Baker, Jr., Nan Bartlett, Alaric Parrish, Joe W. Davis, Gary W. Campbell, Ben H. Shipley, Ken Pevehouse, Appellees. No. 05-965. Supreme Court of Arkansas. May 4, 2006. 877 Hodson, Woods, & Snively, LLP, by: Michael Hodson, Fayetteville, for appellant. Daily & Woods, P.L.L.C., by: Jerry Canfield, Fort Smith, for appellees. JIM GUNTER, Justice. This appeal arises from an order from the Sebastian County Circuit Court, denying a motion for attorneys' fees filed by appellant, David Harris, in favor of appellees, City of Fort Smith and members of the Fort Smith City Board of Directors (Board). On appeal, appellant argues that the circuit court erred in denying his request for an award of attorneys' fees under the Freedom of Information Act (FOIA) set forth in Ark.Code Ann. § 25-19-107 (Repl.2002). We affirm the circuit court's rulings. The facts in this case are set forth at length in Harris v. City of Fort Smith, 359 Ark. 355, 197 S.W.3d 461 (2004) (Harris II). In Harris II, appellant appealed a grant of summary judgment, asserting that the circuit court erred in finding that one-on-one discussions conducted by telephone or in person between Bill Harding, the city administrator, and individual members of the Board did not constitute Board action that falls under the FOIA. By contacting individual Board members, Harding obtained the approval of the entire Board to submit a bid in an action to purchase real property. The circuit court found that under Arkansas law, the FOIA did not apply "to a chance meeting or even a planned meeting of any two members of the city council." Id. The circuit court also noted that although the Board approved submission of the bid, the purchase could not be and was not finalized until it was publicly discussed and approved. The case was appealed to the court of appeals, which reversed the circuit court. Harris v. City of Fort Smith, 86 Ark.App. 20, 158 S.W.3d 733 (2004) (Harris I). We granted appellant's petition for review. In Harris II, we held that, under the facts of the case, Harding's contact of individual Board members to obtain approval of action to be taken by the Board as a whole constituted an informal Board meeting subject to the FOIA. We affirmed the decision of the court of appeals, and we reversed and remanded to the circuit court on the issues of an injunction and attorneys' fees. Harris II, supra. On May 31, 2005, upon remand, the circuit court held a hearing on the two remaining issues. At the hearing, it was disclosed during counsel's arguments that appellant was charged $10,000 in attorneys' fees, and appellees spent $25,000 defending the case. The circuit court granted injunctive relief, but denied attorneys' fees. The circuit court's order was entered on July 18, 2005. From this order, appellant appeals the circuit court's ruling on the issue of attorneys' fees. For his sole point on appeal, appellant argues that the circuit court erred in denying his request for an award of attorneys' fees as the prevailing party in this FOIA action as set forth in Ark.Code Ann. § 25-19-107. Specifically, appellant contends that an award of attorneys' fees is mandatory under the statute. Appellant urges this court to revise the standard for an award of attorneys' fees in FOIA cases. Appellees respond, arguing that appellant failed to establish that the circuit court abused its discretion in denying attorney's fees under the FOIA. Specifically, appellees argue that the circuit court correctly found that their actions were based on a good-faith belief that one-on-one discussions with the Board members did not constitute a violation of the public-meeting provision of the FOIA. 878 We have said that attorneys' fees are not allowed except where expressly provided for by statute. Chrisco v. Sun Indus., 304 Ark. 227, 800 S.W.2d 717 (1990). An award of attorneys' fees will not be set aside absent an abuse of discretion by the trial court. Chrisco, 304 Ark. at 230, 800 S.W.2d at 719. While the decision to award attorneys' fees and the amount awarded are reviewed under an abuse-of-discretion standard, we review factual findings by a circuit court on the existence of the Chrisco factors under a clearly-erroneous standard of review. Davis v. Williamson, 359 Ark. 33, 194 S.W.3d 197 (2004). We are called to interpret the FOIA statutory provision regarding attorneys' fees. We review issues of statutory construction de novo. Farrell v. Farrell, 365 Ark. 465, 231 S.W.3d 619 (2006). We are not bound by the trial court's decision; however, in the absence of a showing that the trial court erred, its interpretation will be accepted as correct on appeal. When reviewing issues of statutory interpretation, we keep in mind that the first rule in considering the meaning and effect of a statute is to construe it just as it reads, giving the words their ordinary and usually accepted meaning in common language. When the language of a statute is plain and unambiguous, there is no need to resort to rules of statutory construction. A statute is ambiguous only where it is open to two or more constructions, or where it is of such obscure or doubtful meaning that reasonable minds might disagree or be uncertain as to its meaning. When a statute is clear, however, it is given its plain meaning, and this court will not search for legislative intent; rather, that intent must be gathered from the plain meaning of the language used. Id. The FOIA allows for an award of attorneys' fees under Ark.Code Ann. § 25-19-107, which provides in pertinent part: (d) In any action to enforce the rights granted by this chapter, or in any appeal therefrom, the court shall assess against the defendant reasonable attorney's fees and other litigation expenses reasonably incurred by a plaintiff who has substantially prevailed unless the court finds that the position of the defendant was substantially justified or that other circumstances make an award of these expenses unjust. However, no expenses shall be assessed against the State of Arkansas or any of its agencies or departments. If the defendant has substantially prevailed in the action, the court may assess expenses against the plaintiff only upon a finding that the action was initiated primarily for frivolous or dilatory purposes. Id. We give a liberal construction to the FOIA, found at Ark.Code Ann. § 25-19-101 et seq. (Repl.2002 & Supp.2003), to accomplish its "broad and laudable purpose that public business be performed in an open and public manner." Fox v. Perroni, 358 Ark. 251, 188 S.W.3d 881 (2004). Under the plain language of the statute, attorneys' fees shall be assessed against the defendant (1) when the plaintiff substantially prevailed in his suit to enforce a right granted under the FOIA unless (2) the position of the defendant was substantially justified or other circumstances make an award of attorneys' fees or costs unjust. We interpreted the attorneys'-fees provision of the FOIA for the first time in Depoyster v. Cole, 298 Ark. 203, 766 S.W.2d 606 (1989). Depoyster argued that he was entitled to an award of attorneys' fees and costs under Ark.Code Ann. § 25-19-107(d). Quoting from an article published in 1987 Arkansas Law Notes, we 879 explained that "[t]he court need not . . . make a fee award in every FOIA case; indeed, the purpose of the fee-shifting provision is to assess fees and costs where public officials have acted arbitrarily or in bad faith in withholding records." Id. at 208, 766 S.W.2d at 609. We further stated that "[w]e do not imply by this opinion that an award of litigation expenses under the FOIA will always be defeated in the absence of arbitrary or bad faith conduct on the part of the defendant." Id. We held that the circumstances in that case made an award of attorneys' fees and costs unjust. Id. In Depoyster, we used the test of whether public officials had acted "arbitrarily" or in "bad faith" in withholding public records for purposes of deciding whether to award attorneys' fees for a FOIA violation. However, given the standard set out in the plain language of Ark. Code Ann. § 25-19-107(d), we now determine whether the defendant was "substantially justified" in withholding the records or whether other circumstances make an award of attorneys' fees or costs unjust. The plain language of the statute clearly controls over the bad-faith test quoted from a law review article in Depoyster. To the extent that Depoyster conflicts with any respect to our statute, we overrule it. We now determine if attorneys' fees are warranted in the present case. Here, appellant prevailed on appeal in Harris II on the FOIA issue, so appellant clearly has met the first prong of the statutory requirement. Appellant substantially prevailed in his suit to enforce a right granted under the FOIA. The remaining issue then is whether appellees' position was substantially justified or other circumstances make an award of attorneys' fees or costs unjust. See Ark.Code Ann. § 25-19-107. In this case, the trial court made the following ruling: [T]he defendants have demonstrated that their actions in this case were based on a good faith belief that their actions did not constitute a violation of the public-meeting provision of the Arkansas Freedom of Information Act and that the plaintiff has failed to demonstrate that the actions of the defendants were undertaken in an arbitrary manner or in bad faith so that the court determines and orders that the expense of the plaintiff's attorneys' fees should not be shifted to the defendants even in this case involving the Arkansas Freedom of Information Act, which the court liberally construes to the end that its praiseworthy purposes be achieved[.] Notwithstanding that the circuit court relied on the bad-faith test articulated in Depoyster, supra, we nevertheless agree with the circuit court's ruling. While the court erred in its reasoning, the court's judgment should be affirmed as reaching the right result for the wrong reason. Wright v. City of Little Rock, 366 Ark. 96, 233 S.W.3d 644 (2006). Here, the following testimony was presented to the circuit court. Raymond W. Gosack, Deputy City Administrator, testified on direct examination that "we had no reason to believe that we were violating the Freedom of Information Act." He stated that "we were not trying to circumvent the Freedom of Information Act," adding that he did not act in bad faith to deny public access to information, nor did he intend to violate the law. Gosack testified that "the result was that the city saved approximately $400,000.00 over the appraised value of the property by participating in the auction process" of the Fort Biscuit deal. Further, Gosack testified that appellees intended to comply with the requirements of the FOIA, as well as any 880 rulings by our court. Notwithstanding that appellees did not have formal approval to submit a bid by the Board, Gosack's understanding was that the bid was not binding until the Board took formal action to approve it. Gosack explained in direct examination that he relied upon El Dorado v. El Dorado Broadcasting Co., 260 Ark. 821, 544 S.W.2d 206 (1976), as the basis for his belief that one-on-one phone meetings with individual members of the Board were permissible. In El Dorado, we held that the FOIA was inapplicable to "a chance meeting or even a planned meeting of any two members of the city council," but that it applied to "any group meeting called by the mayor or any member of city council[.]" Id. at 824, 544 S.W.2d at 208. Here, the Board did not convene in any group meeting called by the mayor or any member of city council. Rather, Harding had one-on-one conversations with individual members of the Board to discuss the bid. Additionally, Tom Carpenter, city attorney for the City of Little Rock, testified that "[o]n occasion, we have had situations usually dealing with things like the settlement of a lawsuit in which we have had individual phone calls with individual members of the Board of Directors or individual contact." Carpenter further testified that he interpreted serial one-on-one contacts as permissible under the law. We have repeatedly stated that we give due regard to the opportunity of the circuit court to judge the credibility of the witnesses. $15,956 in U.S. Currency v. State, 366 Ark. 70, 233 S.W.3d 598 (2006). Here, the circuit court placed considerable weight in Gosack and Carpenter whose testimony supports a finding that there was substantial justification in appellees' position. More significantly, we explained in Harris II that appellees had "a laudable purpose in acquiring the Fort Biscuit property by confidential bid." Id. Appellees would acquire the property at a price "favorable to taxpayers," and the downtown area would benefit from the improved traffic conditions. Id. Thus, we conclude that appellees' position was substantially justified under Ark.Code Ann. § 25-19-107. For these reasons, we hold that the circuit court's findings were not clearly erroneous, and therefore, the circuit court did not abuse its discretion in denying the award of attorneys' fees. Accordingly, we affirm the circuit court's ruling. Affirmed. GLAZE and IMBER, JJ., dissent. TOM GLAZE, Justice, dissenting. To begin with, I commend the majority for its decision to overturn the erroneous and unfortunate language set out in Depoyster v. Cole, 298 Ark. 203, 766 S.W.2d 606 (1989). I strongly disagree, however, with the majority's ultimate decision to deny attorney's fees to David Harris. In this case, Harris has spent approximately $10,000 in order to expose the City of Fort Smith's FOIA violation. Yet, despite his resounding victory on the merits, Harris will not be reimbursed his attorney's fees and litigations costs for his efforts. The FOIA statutory provision regarding attorneys' fees is set out at Ark.Code Ann. § 25-19-107 and states the following: In any action to enforce the rights granted by this chapter, or in any appeal therefrom, the court shall assess against the defendant reasonable attorney's fees and other litigation expenses reasonably incurred by a plaintiff who has substantially prevailed unless the court finds that the position of the defendant was substantially justified or that other circumstances *881 make an award of these expenses unjust. (Emphasis added). The attorneys' fees provision, like all provisions of the FOIA, is to be liberally interpreted in order to accomplish the purpose of promoting free access to public information. Johninson v. Stodola, 316 Ark. 423, 872 S.W.2d 374 (1994). Given these standards, it is clear that the City of Fort Smith was not "substantially justified" in its decision to violate the FOIA. The City has stipulated to the following four facts: (1) Bill Harding, the city administrator, held one-on-one meetings with individual members of the City Board in order to determine "whether the Board would approve the purchase of the land at a subsequent meeting if Mr. Harding made a successful bid at the public auction;" (2) Harding's contact with the Board members involved city business; (3) the public was not notified of these meetings; and finally, (4) the purpose of the meetings was to avoid publicly disclosing the amount of the City's bids. See Harris v. City of Fort Smith, 359 Ark. 355, 197 S.W.3d 461 (2004). These stipulations are all supported by a memorandum sent by Fort Smith Deputy City Administrator Ray Gosack to his superior, Harding. The Gosack memorandum gives insight into the true purpose behind the City's stealthy negotiations for the Fort Biscuit property. The memo provides in pertinent part the following: Acquiring this property through an auction creates some unusual challenges for the city. Normally, we seek formal board approval, including an offer price, before acquiring property. If we obtain formal board approval for acquisition of the Fort Biscuit property, the city won't be able to competitively bid for the property since our maximum offer would be public information . . . If the board is interested, we'll need to have some appraisal work performed to determine how much the city should offer for the property. We would then informally review a maximum offer amount with the board. We'd want to have the board's concurrence on a maximum offer amount before participating in the auction. (Emphasis added). The Gosack memo combined with the stipulations from the City itself shows that the City intended to shield its activity from the public in order to acquire the property at a good price. The majority court believes the City's actions were for a "laudable purpose" and grounds for substantial justification under the statute. I could not disagree more. Here, the City's actions were intentionally designed to illegally circumvent the public disclosure requirements. By vindicating the City's actions, the majority is not liberally interpreting the FOIA; instead, it is undermining the purpose behind the Act. The attorney's fee provision was enacted to encourage a person to file suit when a violation of the FOIA occurs. It is unreasonable to think that citizens will continue to bring FOIA claims when their right to recover attorney's fees and costs are taken away. Although the public has greatly benefitted by Harris's actions, Harris has incurred a substantial monetary loss as a result of this court's decision. Given these circumstances, Harris has won nothing more than a Pyrrhic victory. Hereafter, only the wealthy or the news media can afford to bring lawsuits against public officials who choose, like the City of Fort Smith, to refuse to follow the dictates of the FOIA. For these reasons, I respectfully dissent. IMBER, J., joins this dissent.	{ "pile_set_name": "FreeLaw" }
176 F.2d 301 (1949) MOTTOLESE v. KAUFMAN, District Judge. No. 21334. United States Court of Appeals Second Circuit. Argued May 2, 1949. Decided July 6, 1949. Delson, Levin & Gordon, New York City (Harold F. Levin, Edward Marks and Norman Moloshok, New York City, of counsel), for petitioner. Sullivan & Cromwell and John G. Dorsey, New York City, for intervenor Marine Midland Trust Co. Abraham M. Glickman, New York City (Samuel Levinkind, New York City, of counsel), for intervenor Securities Corporation General. Before L. HAND, Chief Judge, and SWAN and FRANK, Circuit Judges. L. HAND, Chief Judge. This is a petition for mandamus to direct the respondent, Judge Kaufman, to proceed in due course with the hearing and trial of an action in the District Court for the Southern District of New York, between Mottolese, the petitioner, as plaintiff, and Harry Preston and others, as defendants. The petitioner sought by appeal to review the same order which this petition brings up; and although we dismissed the appeal last January,[1] we suggested that mandamus might be an appropriate remedy. The petitioner has followed that suggestion without, however, renewing her motion before Judge Kaufman. The action is a shareholders' derivative suit brought in the interest of the San-Nap-Pak Company, Inc., a New York corporation, against its directors, past and present, and a number of corporations alleged to have been concerned in the wrongs in question, which consisted of depredations upon the corporate treasury. It was commenced on July 7, 1948, at which time there was already pending in the state court an action, consolidated out of nine separate actions, all upon the same claims and against substantially the same defendants, but brought by separate shareholders. The first of these nine actions had been begun on June 30, 1947, and the other eight had followed before November 28 of that year, the date of the consolidation order. The attorneys for the plaintiff in the present action were the attorneys for the plaintiffs in a majority of the nine actions, and the state court made them attorneys in the consolidated action. On July 21, 1947, another shareholder, Turner also represented by these attorneys commenced an action in the District 302 Court of the Southern District of New York and on January 28, 1948, the same plaintiff commenced a second action, and these two have also been consolidated. Turner withdrew, and the complaints in the two Turner actions were ordered dismissed; but before any order had been entered, one, Martini, was allowed to intervene on November 8, 1948, and the action is still pending. A motion for a stay in this consolidated Turner action on the same grounds as that made in the case at bar is now pending undetermined before judge Bondy, awaiting the outcome of this motion. Judge Kaufman, by an order entered November 22, 1948, stayed any further proceedings in the action at bar pending the determination of the consolidated action in the state court "without prejudice, however, to the right of the plaintiff to apply to vacate or modify the stay in event of any change in circumstances in, or affecting the action entitled Waterman Corporation et al. v. James J. Johnston et al. * * which would make it inequitable to continue the stay." Before this order was entered the plaintiff had given notice of the taking of the depositions of three of the corporate defendants, which they had moved to vacate; and the order now before us directed that any further proceedings to take the depositions should be held in abeyance. There can be no question that we have jurisdiction to proceed by mandamus, and, if the stay of the action was wrong, the writ should go,[2] for the issues that will be decided in the Consolidated Action will be almost certain to dispose of the case at bar. The real plaintiff in interest there and here is not the shareholder, but, as in all shareholders' derivative suits, the San-Nap-Pak Company; and a judgment in the state action, if indeed not an absolute bar in this action, would at least be an estoppel as to the controlling issues. Therefore, although the district court and we upon appeal would not formally lose jurisdiction over the case, it would come to us already decided in substance. Only by a present review of the order can that consequence be avoided; and the writ is necessary to our appellate jurisdiction, which otherwise may be defeated. It is probably true that originally the statutory privilege of access to a federal court was regarded as absolute and indefeasible, no matter whether its exercise resulted in inconvenience, delay and expense to the defendant.[3] There can be no doubt, however, that this is no longer true. One of the many exceptions is when a critical issue in the federal action is the proper construction of a state constitution, or statute.[4] Other exceptions are when the federal action involves interference in the internal affairs of a corporation;[5] or when there is an adequate local administrative procedure provided by the state;[6] or when a federal action for a declaratory judgment is brought, "where another suit is pending in a state court presenting the same issues."[7] These are all instances of a discretionary power to stay the federal action, because a proper regard for the autonomy of the states makes that course desirable. However, the Ninth Circuit in Butler v. Judge of the United States District Court,[8] as we read its opinion, sustained a stay of the federal action, merely because the same issues were involved in an earlier action in the state court between the same parties; and the First Circuit in In Re President & Fellows of Harvard 303 College[9] proceeded upon the assumption that that power existed, although it thought that the discretion of the district court had been abused, principally, if not altogether, because the federal action came first. In Brendle v. Smith[10] Judge Rifkind stayed a shareholder's derivative suit in a situation similar to that at bar. The power is well settled, when the earlier suit is also in a federal court. Landis v. North American Co.[11] recognized the general principle in language often quoted: "The power to stay proceedings is incidental to the power inherent in every court to control the disposition of the causes on its docket with economy of time and effort for itself, for counsel, and for litigants. How this can best be done calls for the exercise of judgment, which must weigh competing interests and maintain an even balance." Perhaps, when a plaintiff has already sued in a federal court, the question whether he shall be allowed to start suit in another federal court is of less importance than whether he shall have access to a federal court after he has sued in a state court. And yet the privilege of suing in a particular federal court is as absolute, in form at least, as the privilege of suing in any federal court. However that may be, the decisions of the Supreme Court in Gulf Oil Company v. Gilbert[12] and Koster v. Lumbermen's Mutual Insurance Co.[13] have settled it that a federal action depending in diverse citizenship is always subject to the plea, forum non conveniens; and from these it follows that a federal suit, which has been brought after a state suit, may be stayed, for we can see no difference in kind between the inconveniences which may arise from compelling a defendant to stand trial at a distance from the place where the transactions have occurred, and compelling him to defend another action on the same claim. For these reasons we think that the order on review was within the discretion of the district court, and the only question is whether in this instance that discretion was abused. It is quite true, as was held in Meredith v. City of Winter Haven,[14] that a defendant must show some positive reason why the federal action should not be allowed to proceed, if he is to bar the plaintiff's privilege. On the other hand, equity has always interfered to prevent multiplicity of suits, and the same considerations which persuaded the state court to consolidate the nine actions there pending, make equally desirable a course as near to that as the law permits. Since the action cannot be consolidated with the Consolidated Action, it is proper to stay it, except as some reason appears why the claim cannot be as speedily and as effectively prosecuted in the Consolidated Action as here. As the case comes to us the result therefore depends upon the likelihood that the eventual decision will be reached earlier in the federal action, or that the order on review will deprive the plaintiff of procedural advantages which do not have equivalents in the state action. As to the first, there is nothing in the record to show that an earlier trial is more likely in the federal court than in the state court. Indeed, we take judicial notice of the fact that the non-jury docket in the Southern District of New York is in the neighborhood of eleven months in arrears. As to any procedural advantages in the federal court, the petition alleged that "the practice of taking depositions in the state court was restricted and cumbersome and subject to extensive delays by appeals"; and this the defendants have not denied. Moreover, it is true that the power to examine orally given under Rule 30(a), Federal Rules of Civil Procedure, 28 U.S.C.A., is more certain and simpler than the procedure under the Civil Practice Act and Rules of the Supreme Court of the State of New York. As has already appeared, Judge Kaufman is holding "in abeyance" the motions of the three defendant corporations, to vacate under 304 Rule 30(b) the notices which the plaintiff has served upon them under Rule 30 (a); and we think that at some time and in some form the prosecution of the claim should have the advantage of privileges of examination before trial equivalent to those which the Federal Rules afford. On the other hand, no other advantages have as yet appeared which will accrue from the federal action; and it will be at once unnecessary and burdensome to allow it to go on to trial, if those privileges can be afforded the prosecution of the claim in the Consolidated Action. We think that they can be afforded if the following course is pursued. If the defendants refuse to submit to as full examination in the state court as the plaintiff could obtain in the action at bar, the judge should decide the motions made under Rule 30(b) to vacate the notices served under Rule 30(a). If he grants the motions as a matter of federal procedure under Rule 30(b), we see no reason why he should take any other step in the action at bar, unless some other ground for intervention shall come up later. If on the other hand he denies the motions as a matter of federal procedure, the plaintiff should be allowed to proceed with the examinations. When these are concluded, if the defendants in the Consolidated Action are willing to consent, and do consent, to the use of them in that action, we see no occasion for any further steps in the case at bar. It is quite possible that, when Judge Kaufman held the motions "in abeyance," he meant to wait until it appeared that the defendants would not agree to examinations in the Consolidated Action equivalent to those which could be had under Rule 30. We do not mean to circumscribe his discretion in that regard in what we are now saying; very properly he will wish to known whether any decision of the motions is necessary before he makes it. If the defendants in the Consolidated Action refuse to allow the examinations, if and when taken, to be used in that action, this action should go forward; but on this record the petition is premature. Petition denied. FRANK, Circuit Judge (dissenting). 1. As my colleagues' opinion shows, there are now pending in the court below two stockholders' derivative suits against the defendants, based on the same claim, and asking the same relief, i. e., the Mottolese suit and the earlier Martini suit.[1] Plaintiff moved to consolidate those two suits, but one of the defendants successfully opposed that motion. Since, however, a stay of the Mottolese suit will be academic unless the Martini suit is also stayed, I take it that my colleagues are, in effect, directing Judge Bondy to stay the Martini suit. I shall therefore discuss the decision as if it involved a stay of the Martini suit. The Martini suit was begun on July 21, 1947, less than three weeks after the first state-court suit was brought (July 2, 1947), and when no others were pending. At that time, no steps of any significance had been taken in the state-court suit, so that, practically, the situation was the same as if the Martini suit had been begun a day after the state-court suit. Since the Martini suit began, there have been merely pleading maneuvers in the consolidated state-court suit; so far as the record here shows, the pleadings there have not yet been settled and the case is far from being ready for trial.[2] 305 Thus the legal issue here boils down to this: A plaintiff begins an in personam suit in the state court in New York City against some defendants. The next day, another in personam suit, on the same claim against the same defendants,[3] is brought, under the diversity clause, in the federal district court in the same city. Has the federal district court, on these facts alone, discretion, on defendant's motion, to grant a stay of the federal suit, at a time when the state-court suit is not yet ready for trial? My colleagues say that it does, although they concede that the stay will kill off the federal suit for all practical purposes (excepting only, under a condition now prescribed by my colleagues, the limited purpose of affording plaintiff aid in discovering some evidence for use in the state-court suit). That decision goes a long way towards wiping out a substantial part of the diversity of citizenship jurisdiction of the federal courts, a jurisdiction with roots deep in our national history, a jurisdiction conferred because of a highly cherished policy. My colleagues' decision is without precedent in any decisions of the Supreme Court or of any circuit court (including this court). Indeed, it is directly against the teaching of all such decisions including one rendered by my colleagues i. e., Krauss Bros. Lumber Co. v. Louis Bossert & Sons, 2 Cir., 62 F.2d 1004, 1006. In support of their ruling, my colleagues rely on (1) the doctrine of forum non conveniens and (2) that of multiplicity of suits. Combining these doctrines, they conclude that merely the inconvenience to defendants of possibly defending two actions, one in a federal and one in a state court in the same city, suffices to justify staying the federal action, unless the plaintiff shows that that inconvenience to the defendants is outweighed by disadvantages to him which will flow from the stay. Thus my colleagues put on the plaintiff the burden of showing why his federal suit should not be stayed. The Supreme Court, I think, has decided that precisely the contrary is the applicable rule. In Landis v. North American Company, 299 U.S. 248, 255-256, 57 S.Ct. 163, 166, 81 L.Ed. 153, the Court said that "the suppliant for a stay must make out a clear case of hardship or inequity in being required to go forward. * " And there although both suits were in the federal courts the Supreme Court sanctioned a stay only because the issue was one of "extraordinary public moment." Even so, said the court, "the burden of making out the justice and wisdom of a departure from the beaten track lay heavily" on the defendant seeking the stay. In Meredith v. City of Winter Haven, 320 U.S. 228, 234-235, 64 S.Ct. 7, 11, 88 L.Ed. 9, the Court said: "The diversity jurisdiction was not conferred for the benefit of the federal courts or to serve their convenience. Its purpose was generally to afford to suitors an opportunity in such cases, at their option, to assert their rights in the federal rather than in the state courts. In the absence of some recognized public policy or defined principle guiding the exercise of the jurisdiction conferred, which would in exceptional cases warrant its non-exercise, it has from the first been deemed to be the duty of the federal courts, if their jurisdiction is properly invoked, to decide questions of state law whenever necessary to the rendition of a judgment. Commonwealth Trust Co. v. Bradford, 297 U.S. 613, 618, 56 S.Ct. 600, 601, 80 L.Ed. 920; Risty v. Chicago, R. I. & P. Ry. Co., 270 U.S. 378, 387, 46 S.Ct. 236, 240, 70 L.Ed. 641; Kline v. Burke Construction Co., 260 U.S. 226, 234-235, 43 S.Ct. 79, 82, 83, 67 L.Ed. 226, 24 A.L.R. 1077; McClellan v. Carland, 217 U.S. 268, 306 281-282, 30 S.Ct. 501, 504, 505, 54 L.Ed. 762. When such exceptional circumstances are not present, denial of that opportunity by the federal courts merely because the answers to the questions of state law are difficult or uncertain or have not yet been given by the highest court of the state, would thwart the purpose of the jurisdictional act." See also Commonwealth Trust Co. v. Bradford, 297 U.S. 613, 56 S.Ct. 600, 80 L.Ed. 920; Princess Lida v. Thompson, 305 U.S. 456, 465-467, 59 S.Ct. 275, 83 L.Ed. 285, cf. Propper v. Clark, 69 S.Ct. 1333. In many cases, the federal circuit courts have held that federal diversity suits may not be stayed in favor of pending state-court suits, where the facts were like (or stronger than) those before us here. See, e. g., Krauss Bros. Lumber Co. v. Louis Bossert & Sons, 2 Cir., 62 F.2d 1004, 1006; North Woods Club v. Raymond, 6 Cir., 54 F.2d 1017, 1018; Miami County Nat. Bank v. Bancroft, 10 Cir., 121 F.2d 921, 924; Asiatic Petroleum Corp. v. Italia Societa, etc., 3 Cir., 119 F.2d 610, 613; General Outdoor Advertising Co. v. Williams, 1 Cir., 12 F.2d 773; Consumers Gas Co. v. Quinby, 7 Cir., 137 F. 882, 893; Barber Asphalt Paving Co. v. Morris, 8 Cir., 132 F. 945; Defiance Water Co. v. City of Defiance, C.C.Ohio, 100 F. 178.[4] As I read those Supreme Court and circuit court decisions, they come to this: (1) Presumptively a plaintiff has a right to maintain a federal diversity suit, notwithstanding an earlier state suit; (2) in very exceptional circumstances, however, the federal trial judge has discretion to grant a stay; (3) a defendant who asks a stay has a heavy burden of showing that such exceptional circumstances exist. It is true, as my colleagues say, that since McClellan v. Carland, 217 U.S. 268, 30 S.Ct. 501, 54 L.Ed. 762, the Supreme Court has held that a stay of the federal suit is proper where the circumstances are exceptional. The exceptional circumstances recognized up to and including the most recent Supreme Court decisions are the following, enumerated by Judge Hand: (a) a critical issue in the federal action is the proper construction of a state constitution or statute (but cf. Propper v. Clark, supra, as to a state statute); (b) the state provides an adequate administrative procedure; (c) the federal suit seeks a declaratory judgment and a state suit is pending which presents the same issues; (d) the federal suit involves interference in the "internal affairs" of a foreign corporation (but cf. Koster v. Lumberman's Mutual Co., 330 U.S. 518 at page 527, 67 S.Ct. 828, 91 L.Ed. 1067). There are in the instant case no exceptional circumstances the same as or remotely resembling any of those thus heretofore recognized. The sole fact to which my colleagues point as "exceptional" here is that the state suit commenced first. But never has that fact been regarded as enough. Whenever it has been urged as a ground for a stay, the upper federal courts have rejected it. See, e. g., Great North Woods Club v. Raymond, 6 Cir., 54 F.2d 1017; Krauss Bros. Lumber Co. v. Louis Bossert & Sons, 2 Cir., 62 F.2d 1004; Premier Malt Products Co. v. G. A. Ackerman Printing Co., 7 Cir., 24 F.2d 89; Byrd-Frost, Inc. v. Elder, 5 Cir., 93 F.2d 30; General Outdoor Advertising Co. v. Williams, 1 Cir., 12 F.2d 773; W. Reeves Lumber Co. v. Leavenworth, 5 Cir., 248 F. 686; Holmes County v. Burton Const. Co., 5 Cir., 272 F. 565; Boston & M. R. R. v. Dutille, 1 Cir., 289 F. 321; Barber Asphalt Paving Co. v. Morris, 8 Cir., 132 F. 945, 948-949; Consumers Gas Co. v. Quinby, 7 Cir., 137 F. 882, 893; cf. Commonwealth Trust Co. v. Bradford, 297 U.S. 613, 56 S.Ct. 600, 80 L.Ed. 920; Grubb v. Public Utilities Comm., 281 U.S. 470, 476, 50 S.Ct. 374, 74 L.Ed. 972. Of particular interest is Krauss Bros. Lumber Co. v. Louis Bossert & Sons, 2 Cir., 62 F.2d 1004, 1006. There the plaintiff had begun a suit in the state court some six months before he began the federal suit. The state suit was at issue and on the trial calendar when defendant asked a stay of the federal suit.[5] Yet Judge Learned Hand, with Judge Swan's concurrence, 307 refused to abate the federal suit. That decision was rendered in 1933.[6] My colleagues point to no intervening decisions of this court or of the Supreme Court to explain their shift of position. True, since that date there have been decisions holding that unusual facts do permit the exercise of discretion in staying such a federal action; but, I repeat, there has been no intimation that the mere chronological priority of the state action is enough. The doctrine of Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188, 114 A.L.R. 1487, will not serve as an explanation, in the light of Meredith v. City of Winter Haven, supra; cf. Propper v. Clark, 69 S.Ct. 1333. Neither of the two decisions in other circuits cited by my colleagues employed or even discussed any distinction between a case where the state-court action is begun before and one where it is brought after the federal action: (1) In In re President and Fellows of Harvard College, 1 Cir., 149 F.2d 69, the court held the stay improper because the circumstances were not exceptional; there is nothing in the opinion indicating that the decision would have been otherwise if the state suit had been begun first. Significantly, the court, after citing with approval Great North Woods Club v. Raymond, 6 Cir., 54 F.2d 1017 a case where the state-court suit was prior in time said: "The later decision in Erie R. Co. v. Tompkins, supra, has not weakened the authority of McClellan v. Carland, which was cited with approval in Meredith v. Winter Haven, supra (320 U.S. 228 at page 234)." [149 F.2d 73.] (2) In Butler v. Judge, 9 Cir., 116 F.2d 1013, 1015, the two suits were not of the ordinary in personam type but involved the quieting of title to specific property. While the rationale of that decision is not entirely clear to me, the court did not suggest that it would have stayed the action if it had not involved specific property. Whether or not that decision was sound, it does not support my colleagues' position. I cannot agree with my colleagues that the stay here can be brought within the forum non conveniens doctrine. I think that it is one thing (1) to dismiss a federal suit because of the serious "inconveniences which may arise from compelling a defendant to stand trial at a distance from the place where the transactions have occurred" (when, be it noted, the plaintiff can begin again in the federal court in another district) and quite another thing (2) to arrest a federal diversity suit because it will require the defendant "to defend another action on the same claim" where both actions are brought in the very same place. To treat (1) and (2) identically, as my colleagues do, is, I say, to shift to the plaintiff the burden of proving that the stay is improper. In Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 67 S.Ct. 839, 843, 91 L.Ed. 1055, the Court said, as to the rationale of forum non conveniens: "There is a local interest in having localized controversies decided at home."[7] That rationale has no pertinence in this case. Nor can I agree that the multiplicity-of-suits doctrine is applicable. There is now but one suit pending in the state court. There are two in the federal court, only because (as earlier noted) one of the defendants successfully opposed plaintiff's motion to consolidate the Mottolese and Martini suits; as they ought now be consolidated, and are not thanks solely to a defendant's objection, we should treat the case as if there were but one state and one federal action. The pendency of but a single other suit would, at best, be a slim basis for invoking the multiplicity doctrine. More to the point, it has never been invoked in a context such as that here. If there is the requisite "multiplicity" here, there was fully as much "multiplicity" in the Krauss Bros. case, supra, where the state suit was set for trial but my colleagues refused to abate the later federal suit. And what of the cases cited above where other circuits have ruled similarly? 2. Even assuming, arguendo, that plaintiff has the burden my colleagues put upon him, I think he has borne it. For he has pointed to the notorious fact that, in the 308 New York courts, the procedure for examination before trial is far less satisfactory than in a federal court. Not only have learned commentators so explained,[7a] but so also has an official New York body, the Judicial Council; for several years the Council has unsuccessfully urged legislation to remedy some of those glaring defects of the state procedure, defects which have caused much litigation.[8] The defects are most notable in the First Department, where the state-court suit against the defendants here is pending. Among the weaknesses of the state procedure is this: A pre-trial examination is allowed only on an affirmative showing that each item of the examination is "material and necessary";[9] under the Federal Rules the deponent may be examined regarding any matter "relevant to the subject matter involved in the pending action," a phrase which has not received any restrictive interpretations similar to those given by the New York courts to the word "necessary." In a suit like this, where it is likely that none of the relevant facts are within the personal knowledge of the stockholder plaintiffs, full examination before trial is vital.[10] On these facts alone, I think the stay should have been denied (especially as the plaintiff has stated her willingness to stipulate that there will be no duplication of pre-trial testimony in the state and federal courts). Moreover, in the state court, many interlocutory appeals are permitted, as a matter of right,[11] so that the course of an action there is far more cumbersome. Illustrative is the fact that, in the very state suit here, there has already been an interlocutory appeal from an order denying motions to dismiss the complaint. As experience shows, the delays resulting from such appeals[12] will in all probability more than offset any delay in the federal suit due to the crowded docket in the Southern District of New York.[13] It is also pertinent that the state law does not guarantee as complete protection as the federal to the stockholders who do not become 309 parties to the action. Rule 23(c) of the Federal Rules of Civil Procedure expressly requires that before a derivative action in the federal court can be dismissed or compromised, notice of the proposed dismissal or compromise shall be given to all stockholders in such manner as the court directs. In the New York courts, on the other hand, while the compromise or dismissal is subject to the judge's approval, there is no law requiring[13a] notice to the stockholders who have not appeared in the action. This is most important, for the compromise of the suit will generally bar subsequent derivative actions on the same facts, and if the stockholders are not notified of the settlement, they may lose their rights without ever having known of them. Instead of concluding that, all else aside, the procedural disadvantages in the state court rendered it clearly an abuse of the trial judge's discretion to stay this suit, my colleagues resort to a roundabout technique to bolster his order. They say that the order may stand on the basis of a condition not imposed by the trial judge, i. e., that the defendants in the state court consent to the use in that suit of any answers to pretrial questions properly put to the defendants in the federal suit. Thus the sole remaining purpose of the federal suit is to aid in discovery of facts for use in the state court. This is a novel suggestion. Indeed, whenever it has appeared to a district judge that the sole purpose of a federal suit was to aid discovery of evidence for use in a state suit, discovery has been denied. De Seversky v. Republic Aviation Corp., D.C., 2 F.R.D. 183; Empire Liquor Corp. v. Gibson Distilling Co., D.C., 2 F.R.D. 247; Bachrach v. General Investment Corp., D. C., 31 F.Supp. 84; Snap Lite Corp. v. Stewart Warner Corp., D.C., 40 F.Supp. 776. However that may be, the condition imposed by my colleagues, if satisfied, will not cure the defects in the state procedure: (1) It will not preclude many interlocutory appeals as of right by the defendants in the state suit. (2) It will not ensure notice to all stockholders of a settlement. (3) Most important, it will not give plaintiff the same freedom he would have in the federal court to examine, before trial, persons other than defendants in the federal suit. A plaintiff in the state court is in that respect particularly hamstrung; in general, he can there, before trial, examine such persons only by demonstrating that they will not be available as witnesses at the trial. Consider, then, the complications which may ensue. If the plaintiff desires to examine before trial any non-defendants who will be available at the trial, he will have to apply to the federal district court; presumably that court will permit such examination on condition that the defendants in the state suit consent that the testimony of such non-defendants may (if relevant) be used in that suit. Thus the intertwining of the two suits will yield more complications than would occur if the federal action were allowed to continue wholly unrestricted. This also should be noted: There are some persons who are defendants in the state suit but not in the federal suit. As to them, my colleagues' condition will leave plaintiff hampered. For pre-trial examination of those persons, since they are not parties to the federal suit, will be governed by the narrower state rules as to nonparties, whereas, were the federal suit to continue unrestricted, those persons could be examined freely. My colleagues indicate that, after all, no harm is done to plaintiff by the stay because he can at any time apply for its modification, if the state suit is delayed or the stay becomes more oppressive than it now is. In the Landis case, the Court answered a similar suggestion by saying that "to drive a plaintiff to that course is to make him shoulder a burden that should be carried by" the defendant asking the stay, and that an improper order "is not to be upheld 310 * * * because conceivably the court that made it may be persuaded at a later time to undo what it has done."[14] I think we should direct that the motion for a stay be denied and that this action be consolidated with the pending Martini action. NOTES [1] Mottolese v. Preston, 2 Cir., 172 F.2d 308. [2] McClellan v. Carland, 217 U.S. 268, 30 S.Ct. 501, 54 L.Ed. 762. [3] McClellan v. Carland, 217 U.S. 268, 282, 30 S.Ct. 501, 54 L.Ed. 762; Kline v. Barke Construction Co., 260 U.S. 226, 239, 43 S.Ct. 79, 67 L.Ed. 226, 24 A.L.R. 1077; City of Ironton v. Harrison Construction Co., 212 F. 353, 355 (semble); Great North Woods Club v. Raymond, 6 Cir., 54 F.2d 1017. [4] United States v. City of New York, 2 Cir., 175 F.2d 75; East Coast Lumber Terminal, Inc. v. Babylon, 2 Cir., 174 F.2d 106. [5] Rogers v. Guaranty Trust Co., 288 U. S. 123, 53 S.Ct. 295, 77 L.Ed. 652, 89 A. L.R. 720. [6] Commonwealth of Pennsylvania v. Williams, 294 U.S. 176, 55 S.Ct. 380, 79 L.Ed. 841, 96 A.L.R. 1166. [7] Brillhart v. Excess Insurance Co., 316 U.S. 491, 495, 62 S.Ct. 1173, 1176, 86 L.Ed. 1620. [8] 116 F.2d 1013. [9] 149 F.2d 69. [10] D.C., 46 F.Supp. 522. [11] 299 U.S. 248, 254, 255, 57 S.Ct. 163, 166, 81 L.Ed. 153. [12] 330 U.S. 501, 67 S.Ct. 839, 91 L.Ed. 1055 [13] 330 U.S. 518, 67 S.Ct. 828, 91 L.Ed. 1067. [14] 320 U.S. 228, 64 S.Ct. 7, 88 L.Ed. 9. [1] As my colleagues' opinion states, the Martini suit was a consolidation of two suits originally brought by Turner; but he later dropped out, and the consolidated suit was continued by Martini, who was an intervenor. [2] The original state-court action, Waterman Corporation v. Johnston, was commenced in the Supreme Court, New York County, on July 2, 1947. Similar suits were filed by other stockholders, and the actions in the state court were consolidated on November 28, 1947. The plaintiffs made a motion therein, returnable on May 28, 1948, for the appointment of a receiver and for injunctive relief. On September 16, 1948, ___ Misc. ___, 85 N. Y.S.2d 462, Mr. Justice Pecora denied for the time being the appointment of a receiver, but enjoined the officers and directors of San-Nap-Pak from taking any acts other than in the normal course of the corporation's business. An order to that effect was entered October 11, 1948. Meanwhile, on July 2, 1948 the plaintiffs moved for leave to bring in additional parties defendant and to serve a supplemental complaint. This motion was granted on September 13, 1948. On January 10, 1949 various motions addressed to the sufficiency of the complaint were denied by Mr. Justice Eder. This decision was appealed to the Appellate Division, First Department, which on April 12, 1949, 275 App.Div. 106, 87 N.Y.S.2d 467, rendered an opinion dismissing two causes of action as to certain defendants, with leave to the plaintiffs to amend. [3] In the consolidated state-court suit, there are some defendants who are not defendants in the federal court. [4] See also cases cited in 1 C.J. 87 note 22; 1 C.J.S., Abatement and Revival, § 67, page 101 note 85. [5] These record facts were set forth in detail in defendant's brief in that case. [6] See remarks by Judge L. Hand, in Bryant v. Atlantic Coast Line Co., 2 Cir., 92 F.2d 569, 571 decided in 1937. [7] See also Koster v. Lumberman's Mutual Insurance Co., 330 U.S. 518, 524-526, 67 S.Ct. 828, 91 L.Ed. 1067. [7a] See, e.g., Saxe, Examinations Before Trial in New York, 36 Law Lib.J. (1943) 112. Compare the remarks of Mr. Justice Lumbard in Peyton v. Coulson, 190 Misc. 754, 74 N.Y.S.2d 730, 732: "This case is an illustration of the need for revision of the antiquated New York law respecting examinations before trial. These litigants have been required to add three applications to an already congested motion calendar in order to obtain relief which would be available under the more efficient Federal Rules of Civil Procedure without any application to the court * * ." See also Tremblay v. Lyon, 176 Misc. 906, 29 N.Y.S.2d 336, 340, where, in denying plaintiff the right to examine defendant before trial, the court said: "Under the new Federal Rules of Civil Procedure, Rules 26 and 30, 28 U.S.C. A. following section 723c, such an examination would be granted as of course." [8] See New York Judicial Council, 8th Annual Report (1941) 361-377. [9] New York Civil Practice Act, § 288 provides: "Any party to an action in a court of record may cause to be taken by deposition, before trial, his own testimony or that of any other party which is material and necessary in the prosecution or defense of the action. * * Any party to such an action also may cause to be so taken the testimony of any other person, which is material and necessary, where such person is about to depart from the state, or is without the state, or resides at a greater distance from the place of trial than one hundred miles, or is so sick or infirm as to afford reasonable grounds of belief that he will not be able to attend the trial, or other special circumstances render it proper that his deposition should be taken." [10] See Hornstein, Legal Controls for Intracorporate Abuse, 41 Col.L.Rev. (1941) 405, 416-422. [11] N. Y. C. P. A. § 609. I favor amendments to the federal statutes allowing many kinds of interlocutory appeals within the discretion of the upper courts. [12] For a convincing brief picture of the dilatory character of such appeals, see the annotations to Sections 588, 589 and 609 of the New York Civil Practice Act. [13] Apart from the argument of delay, that condition of the docket deserves no consideration here. Congress did not say that the right to prosecute a federal diversity of citizenship suit should depend on the number of district judges available. The problem of a paucity of district judges should be met directly by asking Congress to authorize the appointment of more judges in the Southern District. A bill to that effect is now pending. I sincerely hope it passes promptly, in order to relieve the overworked trial judges, whose tasks are more complex and arduous than those of the circuit judges. But there is nothing to commend efforts to reduce work through emasculating interpretations of the judicial code. [13a] Rule 8 of the New York Rules of Civil Practice authorizes, but does not require, such notice. [14] 299 U.S. at page 257, 57 S.Ct. 163, 81 L.Ed. 153.	{ "pile_set_name": "FreeLaw" }
UNPUBLISHED UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT STEVE A. HARRIS, INCORPORATED;  THE FASTEST CAR WASH, L.L.C., Plaintiffs-Appellants, v.  No. 02-1957 KENYON OIL COMPANY, INCORPORATED, Defendant-Appellee.  Appeal from the United States District Court for the District of Maryland, at Greenbelt. Frederic N. Smalkin, District Judge. (CA-01-2925-S) Argued: April 1, 2003 Decided: April 30, 2003 Before TRAXLER and SHEDD, Circuit Judges, and HAMILTON, Senior Circuit Judge. Vacated and remanded by unpublished per curiam opinion. Senior Judge Hamilton wrote a concurring opinion. COUNSEL ARGUED: Stuart Scott Morrison, KATTEN, MUCHIN, ZAVIS, ROSENMAN, Washington, D.C., for Appellants. Patricia Maureen Weaver, PALEY, ROTHMAN, GOLDSTEIN, ROSENBERG & COOPER, CHARTERED, Bethesda, Maryland, for Appellee. ON 2 HARRIS v. KENYON OIL CO. BRIEF: Glenn M. Cooper, PALEY, ROTHMAN, GOLDSTEIN, ROSENBERG & COOPER, CHARTERED, Bethesda, Maryland, for Appellee. Unpublished opinions are not binding precedent in this circuit. See Local Rule 36(c). OPINION PER CURIAM: Steve A. Harris, Inc. ("Harris") and The Fastest Car Wash, LLC appeal the judgment entered in favor of Kenyon Oil Company, Inc. on their breach of contract claim. For the reasons set forth below, we vacate the judgment and remand for further proceedings. Harris contracted to purchase from Kenyon Oil a piece of improved real property located in Silver Spring, Maryland.1 This property had previously been used in part as a gasoline station, and it was improved with gasoline station equipment, including several under- ground storage tanks ("USTs"). The contract provides in pertinent part that the property was being sold "as is" with one exception: Ken- yon Oil agreed to be responsible for the removal of the gasoline sta- tion equipment from the property, and it agreed that "such removal shall be in compliance with all laws, rules, and ordinances of the Fed- eral, state and local government, including without limitation the [Maryland Department of the Environment ("MDOE")]." After the parties had entered into the contract, Kenyon Oil discov- ered and reported to MDOE and Appellants that the property was contaminated. Kenyon Oil thereafter removed five USTs from the property. As part of this process, Kenyon Oil also removed 82 tons of contaminated soil from the UST excavation area. 1 Harris subsequently assigned its interest to The Fastest Car Wash, LLC. We hereafter refer to these parties collectively as "Appellants." HARRIS v. KENYON OIL CO. 3 The parties then closed the contract. Subsequent to the closing, MDOE issued a Report of Observations requiring Kenyon Oil to monitor the groundwater at the property for four consecutive quarters. The monitoring results have shown that the contamination level on the property has increased. Appellants contend that Kenyon Oil breached the contract because (among other reasons) it has not completed its contractual obligation to remediate the contamination on the property. Appellants point spe- cifically to the contractual language that requires Kenyon Oil to remove the gasoline station equipment — i.e., the USTs — "in com- pliance with all laws, rules, and ordinances of the Federal, state and local government, including without limitation, the MDOE," and they assert that Kenyon Oil’s remediation obligation primarily arises under § 26.10.10.03 of the Code of Maryland Regulations ("COMAR"). That MDOE regulation provides that if contaminated soil or ground- water is discovered during the permanent closure of USTs, then the owner or operator of the USTs "shall begin corrective action in accor- dance with COMAR [§] 26.10.09." COMAR § 26.10.10.03(C).2 The corrective action set forth in COMAR § 26.10.09 is a multi-step pro- cess that establishes, under proper circumstances, investigation, reporting, monitoring, and remediation requirements for the UST owner, operator, or other responsible party. On the parties’ cross motions for summary judgment, the district court granted Kenyon Oil’s motion and denied Appellants’ motion. In its memorandum opinion, the district court held that Kenyon Oil’s contractual obligation concerning the USTs is limited to the physical removal of the USTs from the property. The district court stated: The contract only makes sense as an integrated whole when the seller’s obligations with regard to the gasoline station equipment are read as arising only in connection with the physical removal of the tanks, which . . . plainly does not comprehend expensive remediation of environmental con- tamination that predated the removal of the tanks. If such had been the intention of the parties, they could have used language that addressed responsibility for remediating envi- 2 Kenyon Oil disputes the applicability of this regulation. 4 HARRIS v. KENYON OIL CO. ronmental contamination. Instead, they chose to deliver the property as is, less the gasoline station equipment, which is exactly what the buyer got, and they limited the seller’s obligation to restoration, which, in its plain meaning, simply covers a return to the status quo ante. Although the district court quoted the section of the contract that requires Kenyon Oil to remove the USTs "in compliance with all laws, rules, and ordinances of the Federal, state and local government, including without limitation, the MDOE," the district court did not address in any manner either the meaning of this language or the potential applicability of any MDOE regulation (or other law). A district court is ordinarily not obligated to address every conten- tion raised by the parties in a motion. Malbon v. Pennsylvania Millers Mut. Ins. Co., 636 F.2d 936, 939 n.8 (4th Cir. 1980). However, we believe that the district court erred by not addressing the "in compli- ance with" language or the MDOE regulations because these are the crucial matters upon which Appellants’ claim is based. In light of Appellants’ arguments, we cannot say that these matters would have no effect on the outcome of this case.3 The district court may very well have considered these matters in reaching its conclusion; how- ever, because it did not explain its analysis, we are unable to satisfy ourselves that it, in fact, did consider them. As the case is in this posture, our ability to review the judgment is hindered. We therefore vacate the judgment and remand this case to the district court for further proceedings consistent with this opin- ion. See Whittle v. Timesavers, Inc., 749 F.2d 1103, 1106 (4th Cir. 1984) ("because the district court’s opinion did not adequately discuss this issue, we reverse the decision of the district court and remand the case for further proceedings"). We express no opinion on the disposi- tion of the case on remand.4 VACATED AND REMANDED 3 Because the district court ruled on the motions without oral argument, we do not have the benefit of a hearing transcript to review to ascertain whether, and to what extent, the district court considered these matters. 4 On remand, the district court should also reconsider the inextricably intertwined issue of whether Kenyon Oil breached the contract by failing to deliver the appropriate certificate at closing. HARRIS v. KENYON OIL CO. 5 HAMILTON, Senior Circuit Judge, concurring specially: I concur in the judgment and write separately only to address the Appellants’ contention, barely mentioned in the majority opinion, see ante at 4 n.4, that the district court erred by granting summary judg- ment in favor of Kenyon Oil with respect to the portion of their breach of contract claim alleging breach of § 2(A)(10) of the contract. Section 2(A)(10) of the contract required Kenyon Oil to provide the Appellants, at closing, a certificate from the Maryland Department of the Environment (the MDOE) "certifying that the Gasoline Station Equipment, including without limitation, the underground storage tanks, was removed in compliance with the laws of the State of Mary- land . . . ." (J.A. 342). Without directly addressing this allegation of error, the majority opinion merely remands the issue to the district court with the instruction that "the district court should also recon- sider the inextricably intertwined issue of whether Kenyon Oil breached the contract by failing to deliver the appropriate certificate at closing." Ante at 4 n.4. Unfortunately, this instruction does not inform the district court that the two alternative bases upon which it granted summary judgment in favor of Kenyon Oil, with respect to the portion of the breach of contract claim involving § 2(A)(10), are erroneous. Without such information and guidance, the district court may inadvertently repeat the same errors that appear fully in the record before us on appeal. While not binding on the district court, an analysis of the § 2(A)(10) issue may prove helpful to the district court on remand. The district court first granted summary judgment in favor of Ken- yon Oil with respect to § 2(A)(10) of the contract on the basis that Kenyon Oil provided the Appellants with a two-page document that was issued by the MDOE, dated January 31, 2002, and entitled "CER- TIFICATE OF REGISTRATION CLOSURE." (J.A. 787). The Appellants challenge this as error, and I agree. Nowhere does the two- page document provided by Kenyon Oil state that the MDOE certifies that Kenyon Oil removed the Gasoline Station Equipment "in compli- ance with the laws of the State of Maryland . . . ." (J.A. 342). In fact, language in the document stating that "[t]his Certificate does not address any active enforcement actions at this site" makes clear that no such certification was intended by the MDOE. (J.A. 788). 6 HARRIS v. KENYON OIL CO. Alternatively, the district court relied on the doctrine of waiver in granting summary judgment in favor of Kenyon Oil with respect to § 2(A)(10) of the contract. According to the district court, the Appel- lants waived their right to enforce § 2(A)(10) of the contract by clos- ing on the contract without receiving a document as described in § 2(A)(10). The district court’s reliance on the doctrine of waiver in this situation is misplaced. Prior to closing, the parties had expressly agreed (as evidenced by a letter agreement dated November 13, 2001) that closing on the contract would not effect a waiver of any parties’ rights and obligations under the contract. Accordingly, the doctrine of waiver does not provide a proper basis upon which to grant summary judgment in favor of Kenyon Oil with respect to § 2(A)(10) of the contract. On remand, I would allow the district court to consider any and all other arguments which the parties may offer with respect to Appel- lants’ contention that Kenyon Oil breached § 2(A)(10) of the contract by failing to provide them, at closing, with a certificate from the MDOE "certifying that the Gasoline Station Equipment, including without limitation, the underground storage tanks, was removed in compliance with the laws of the State of Maryland . . . ." (J.A. 342).	{ "pile_set_name": "FreeLaw" }
992 F.2d 171 UNITED STATES of America, Appellee,v.Jimmie A. ARMSTRONG, Appellant. No. 92-2346. United States Court of Appeals,Eighth Circuit. Submitted March 17, 1993.Decided April 27, 1993. William C. McArthur, Little Rock, AR, for appellant. Jana Christian, Asst. U.S. Atty., Little Rock, AR, for appellee. Before McMILLIAN, Circuit Judge, BRIGHT, Senior Circuit Judge, and JOHN R. GIBSON, Circuit Judge. McMILLIAN, Circuit Judge. 1 Jimmie A. Armstrong appeals from a final judgment entered in the District Court1 for the Eastern District of Arkansas sentencing him to forty-eight months imprisonment following his guilty plea to conspiring to counterfeit United States currency in violation of 18 U.S.C. § 371. For reversal, he argues the district court erred in enhancing his sentence under U.S.S.G. § 3B1.3 for abuse of a position of trust and under U.S.S.G. § 3C1.1 for obstruction of justice. He also argues the district court erred in denying him a reduction for acceptance of responsibility under U.S.S.G. § 3E1.1. For the reasons discussed below, we affirm the judgment of the district court. 2 According to the presentence report (PSR), Armstrong was employed as a drill instructor with the Arkansas Department of Correction Boot Camp, and he supervised the activities of inmates Michael Northweather, Patrick Liljebeck, and Earnest Reagan. He learned during a discussion session among the inmates that a former employee of Reagan's had once made a counterfeit bill while working in Reagan's print shop. Armstrong then approached the three inmates and discussed with them the possibility of manufacturing counterfeit bills. After Armstrong left the employment of the Boot Camp and the inmates were released, he remained in contact with them. He eventually elicited their help in manufacturing and passing counterfeit bills. The four men were charged with conspiring to counterfeit obligations of the United States. When the four men appeared at the court house for arraignment, Armstrong offered money to the other three in exchange for their statements that Armstrong had no knowledge of the counterfeiting operation. 3 The PSR indicated that, because Armstrong used his position as a drill instructor at the Boot Camp to contact his coconspirators and gain access to information regarding counterfeiting, his offense level should be enhanced for abuse of a position of trust. The PSR also indicated that, because Armstrong asked others to concoct stories about his noninvolvement in the conspiracy and offered his coconspirators money to "take the rap," his offense level should be enhanced for obstruction of justice. The PSR further indicated that Armstrong should be denied a reduction for acceptance of responsibility: even though Armstrong pleaded guilty, he denied that he asked others to concoct stories or that he offered money to his coconspirators to do so, and he was not truthful regarding the extent of his involvement in the conspiracy. Armstrong objected to these sentencing adjustments. 4 After hearing testimony from all four coconspirators and others, the district court overruled the objections. The district court denied Armstrong the acceptance-of-responsibility reduction on the grounds that Armstrong did not testify truthfully concerning his degree of participation in the conspiracy and that, during the search of his home, Armstrong failed to voluntarily disclose the location of all the currency. The district court enhanced Armstrong's sentence for obstruction of justice after concluding that it believed the testimony of Armstrong's coconspirators concerning money Armstrong offered them to exonerate him. The district court further concluded that the enhancement was warranted because Armstrong recruited a former inmate to make a false threat after Armstrong learned that he was a possible suspect in the counterfeiting operation. The district court also enhanced Armstrong's sentence for abuse of a position of trust, finding that he used his position as a drill instructor at the Boot Camp to make contact with his coconspirators and facilitate the commission of the offense. The district court relied on United States v. Brown, 941 F.2d 1300 (5th Cir.) (per curiam) (upholding enhancement for abuse of position of trust where defendant used his position as a correctional officer to obtain heroin with the help of inmates), cert. denied, --- U.S. ----, 112 S.Ct. 648, 116 L.Ed.2d 665 (1991). With a total offense level of 22 and a criminal history category of I, the Guidelines range was 41-51 months. The district court sentenced Armstrong to forty-eight months imprisonment and three years supervised release, imposed a $5,000 fine, and ordered restitution in the amount of $1,380. This appeal followed. 5 A district court may enhance a defendant's sentence under Guidelines § 3B1.3 if the defendant (1) occupied a position of public or private trust and (2) used that position in a manner which significantly facilitated the commission or concealment of the offense. United States v. Brelsford, 982 F.2d 269, 271 (8th Cir.1992). Armstrong's position as a drill instructor at the Boot Camp constituted a position of public trust. Cf. United States v. Claymore, 978 F.2d 421, 423 (8th Cir.1992) (tribal police officer held position of public trust); United States v. Brown, 941 F.2d at 1305 (public places great deal of trust in correctional officers). Armstrong seems to argue that he did not use his position to facilitate the counterfeiting scheme because no plans were made until after he left his employment at the Boot Camp. Liljebeck testified, however, that, while they were at the Boot Camp, Armstrong asked him to solicit Reagan's help in counterfeiting currency. Reagan and Northweather testified that Armstrong had indicated in his office at the Boot Camp that he would like to have some of the counterfeit currency if Reagan ever obtained some. Armstrong himself testified that he learned that Reagan had experience in counterfeiting when Reagan brought it up at a meeting at the Boot Camp and that he asked Reagan questions about the process while he was still employed at the Boot Camp. The record reflects that Armstrong used his supervisory position to interact with the inmates and to solicit their help in obtaining counterfeit currency. At the very least, Armstrong gained access to information which he used later on when he left his employment and the inmates were released. The district court's finding that Armstrong used his position of public trust to facilitate the counterfeiting scheme was not clearly erroneous. See United States v. Brelsford, 982 F.2d at 272-73. 6 In reviewing the enhancement for obstruction of justice, we accept as true the district court's factual findings unless the findings are clearly erroneous. We also give due regard to the district court's opportunity to judge the credibility of the witnesses. See United States v. Noland, 960 F.2d 1384, 1390 (8th Cir.1992). The solicitation of false testimony may constitute an appropriate basis for an obstruction-of-justice enhancement. Id. at 1391. Here, Armstrong testified that he did not intend to offer his coconspirators a bribe when he stated that he would give money to "get out of this mess." Liljebeck testified, however, that Armstrong not only made the statement to him, but also told him that Reagan was going to accept the offer and he should let him know what he was going to do. Reagan testified that Armstrong offered him money to take the responsibility for the scheme so that all four men would not have to go to prison. The district court did not clearly err in discrediting Armstrong's testimony and enhancing Armstrong's sentence based on his coconspirators' testimony. Furthermore, the district court did not clearly err in finding that the obstruction-of-justice enhancement was warranted based on Armstrong's solicitation of a false threat. 7 In light of the district court's finding that Armstrong had obstructed justice by offering money to his coconspirators in exchange for statements that Armstrong was not involved in the counterfeiting scheme, we conclude the district court properly denied the reduction for acceptance of responsibility. See United States v. Todd, 963 F.2d 207, 211 (8th Cir.1992). Furthermore, the record supports the district court's findings that Armstrong was not completely truthful in regard to his involvement in the conspiracy and in regard to the location of the currency in his home. See United States v. Stockton, 968 F.2d 715, 721 (8th Cir.1992) (affirming denial of acceptance-of-responsibility reduction where defendant admitted to only partial involvement in conspiracy). 8 Accordingly we affirm the judgment of the district court. 1 The Honorable Susan Webber Wright, United States District Judge for the Eastern District of Arkansas	{ "pile_set_name": "FreeLaw" }
52 F.2d 842 (1931) MICHIGAN TRUST CO. v. PEOPLE OF STATE OF MICHIGAN. No. 5745. Circuit Court of Appeals, Sixth Circuit. October 8, 1931. B. P. Merrick, of Grand Rapids, Mich. (Travis, Merrick, Johnson & McCobb, of Grand Rapids, Mich., on the brief), for appellant. Charles Rubiner, of Detroit, Mich. (Wilber M. Brucker, of Lansing, Mich., on the brief), for appellee. Before DENISON, HICKS, and HICKENLOOPER, Circuit Judges. HICKENLOOPER, Circuit Judge. On February 9, 1926, appellant was appointed receiver for the Worden Grocer Company, a Michigan corporation, and operated the business under orders of the court until December 30, 1929, at which time all mercantile assets were sold. The only question presented upon this appeal is whether during this period of operation the receiver became obligated, annually, to pay the so-called Michigan franchise tax, for or on behalf of the Worden Grocer Company, which taxes had not been assessed at the time of the appointment of the receiver but were subsequently levied "for the privilege of exercising its franchise and of transacting its business within this state." Section 4, Act No. 85, Public Acts of 1921. Although measured by the amount of the corporation's "paid-up capital and surplus," the tax is obviously not a tax upon the 843 property of the corporation, but an excise tax upon the privilege of doing business in corporate form. Educational Films Corp. v. Ward, 282 U. S. 379, 51 S. Ct. 170, 75 L. Ed. 400; In re Detroit Properties Corp. et al. (decided June 1, 1931) 254 Mich. 523, 236 N. W. 850. In the decision last cited practically all of the authorities upon our main issue are collected, and it would seem useless to review them here in detail, although we shall, of course, refer to many, and shall express our views as to their proper classification. In re Detroit Properties Corporation also recognizes that a proper decision of this issue depends upon whether the receiver, by operating the business, exercised or used any of the franchises of the corporation.[1] This is manifestly the proper criterion to apply. If he did, liability to the tax would be the liability of the receiver and the fee must be paid by him. If he did not use any of the franchises of the corporation, it is extremely difficult, if not impossible, to justify the imposition of a tax against the receiver, as such. It is true that the corporation itself might remain liable to an annual tax upon the franchise "to be" a corporation, or even upon the franchise "to do" business in corporate form, until the corporation was actually dissolved, a distinction given much weight by the Supreme Court of Michigan, but the receiver takes the property charged only with the debts and liabilities of the corporation, liquidated or unliquidated, which exist at the time of his appointment. It would be immaterial in every case whether the corporation might be held independently liable for taxes thereafter accruing, except and unless the properties or some part thereof were subsequently returned to it or a surplus was distributable to stockholders. Otherwise there would be nothing from which the tax could be paid. The corporation would be but an empty shell. Relying upon the supposed distinction between a tax upon the "privilege" of exercising the franchise "to do," and a tax upon the franchise "to be," the opinion in Re Detroit Properties Corporation concludes that inasmuch as a receiver normally may conduct only such business as the corporation was theretofore authorized by charter to transact, such receiver is exercising the corporation's franchise "to do." Compare, also, In the Matter of George Mather's Sons Co., 52 N. J. Eq. 607, 30 A. 321. This would seem a non sequitur where the corporation had been engaged in purely mercantile pursuits, "for franchises are special privileges conferred by government upon individuals, and which do not belong to the citizens of the country, generally, of common right." Bank of Augusta v. Earle, 13 Pet. 519, 595, 10 L. Ed. 274. A receiver "is a mere arm of the court appointing him." Converse v. Hamilton, 224 U. S. 243, 257, 32 S. Ct. 415, 418, 56 L. Ed. 749, Ann. Cas. 1913D, 1292. "Immediately upon such appointment and after the qualification of the receiver, the property passed into the custody of the law, and thenceforward its administration was wholly under the control of the court by its officer or creature." Atlantic Trust Co. v. Chapman, 208 U. S. 360, 370, 28 S. Ct. 406, 408, 52 L. Ed. 528, 13 Ann. Cas. 1155; Booth v. Clark, 17 How. 322, 331, 15 L. Ed. 164. Not only in the case of mercantile corporations is the franchise "to do" inseparable from the franchise "to be," and necessarily implied from a grant of the latter franchise, and the distinction therefore somewhat vague, but no good reason appears in such a case why the receiver may not perform, under direction of the court, any act which might be performed by any other citizen, in total disregard of the corporate capacity of the former possessor of the property, and without any reliance whatever upon its franchises. The property is no longer under the control of the corporation. The court and the receiver need no grant from the state of "special privileges" to effect a disposition of such property in accordance with the rules of law and equity. The limitation that the receiver may normally transact only such business as is authorized by the corporate charter arises from the implied contract between the corporation and its stockholders that the money invested shall be used only for such purposes, not from any dependence by the court upon the grant of the powers enumerated by the charter. The suggested distinction is well enough in the case of a public utility. "No private person can establish a public highway, or a public ferry, or railroad, or charge tolls for the use of the same, without authority from the legislature, direct or derived." California v. Pacific R. Co., 127 U. S. 1, 40, 8 S. Ct. 1073, 1081, 32 L. Ed. 150. Such a franchise 844 is not included in the simple grant under general laws of the right to be a corporation. It is separate and apart from the franchise "to be." Thus, when a receiver is appointed for such public utility, and such receiver proceeds to operate the business, in a very accurate sense he is using the franchise "to do" formerly exercised by the corporation. This is quite plainly suggested by some of the decisions involving railroad or other public utility receiverships. Collector of Taxes v. Bay State St. Ry., 234 Mass. 336, 125 N. E. 614; N. Y. Terminal Co. v. Gaus, 204 N. Y. 512, 516, 98 N. E. 11; Armstrong, Receiver, v. Emmerson, Sec'ty of State, 300 Ill. 54, 132 N. E. 768, 18 A. L. R. 693; Phila. & R. R. Co. v. Commonwealth, 104 Pa. 80. It is the proper ground, we think, upon which other similar cases should have been decided, although both groups are often rather loosely cited as authority for the proposition that a franchise tax is payable wherever the receiver continues to operate the business, regardless of its nature. Compare Bright v. Arkansas, 249 F. 950 (C. C. A. 8); State v. Bradley, 207 Ala. 677, 93 So. 595, 26 A. L. R. 421; Central Trust Co. v. N. Y., C. & N. R. Co., 110 N. Y. 250, 18 N. E. 92, 1 L. R. A. 260. Several other lines of authority, clearly distinguishable in principle, are also relied upon by the appellee. In McFarland v. Hurley, 286 F. 365 (C. C. A. 5) and Liberty Central Trust Co. v. Gilliland Oil Co., 279 F. 432 (D. C. La.), corporation franchise taxes, as such, were not involved. An oil severance tax was imposed by statute. Obviously, if the severance be made by a receiver, such receiver is directly and primarily liable for the payment of the tax. The question here presented was not there involved. In U. S. Car Co. Case, 60 N. J. Eq. 514, 43 A. 673, 674, the corporation is held bound to perform the statutory conditions as long as it remains in possession of the privilege. "The sole test * * * is the existence or nonexistence of the corporation." No consideration whatever is there given to whether the assessment is properly against, and collectible from, the receiver, or whether it should more properly be against the corporation and collectible only if and when such corporation again comes into the possession and control of its property. Duryea v. American Woodworking Mach. Co., 133 F. 329 (C. C. N. J.), and Conklin v. U. S. Shipbuilding Co., 148 F. 129 (C. C. N. J.), add nothing to our knowledge of this subject. No reasons beyond citing the U. S. Car Co. Case are given. Several cases of mercantile corporation receiverships boldly announce the broad rule that the franchise tax is payable by the receiver whenever he continues to operate the business. Savings Co. v. Motors Co., 116 Ohio St. 95, 101, 155 N. E. 691; People of State of New York v. Hopkins, 18 F.(2d) 731 (C. C. A. 2); Ohio v. Harris, 229 F. 892 (dictum) (C. C. A. 6). These cases, we think, are the result of blindly following an apparent mass of precedent (often inaccurately thought out and expressed) without careful analysis of the facts of such cases, or a determination of the soundness of reason underlying the decision in each. We feel under no obligation to follow this lead. In cases in bankruptcy, although this is generally said to be by virtue of section 64 of the Bankruptcy Act (11 USCA § 104), franchise taxes which had not accrued at the time of filing the petition are not thereafter collectible from the receiver. N. J. v. Anderson, 203 U. S. 483, 27 S. Ct. 137, 51 L. Ed. 284; N. Y. v. Jersawit, 263 U. S. 493, 44 S. Ct. 167, 68 L. Ed. 405; Bates v. Archer, 288 F. 182 (C. C. A. 6). These cases impliedly recognize a limitation upon the right of the state to tax a franchise which is not in present enjoyment. So, also, where the receiver does not operate the business, or is appointed in proceedings to dissolve an insolvent corporation, or an injunction has issued against the corporation, restraining the further transaction of business by it, the same rule is applied. Ohio v. Harris, supra; Commonwealth v. Lancaster Savings Bank, 123 Mass. 493, 496; Johnson v. Johnson Bros., 108 Me. 272, 80 A. 741, Ann. Cas. 1913A, 1303; State v. Bradford Savings Bank, 71 Vt. 234, 44 A. 349; Greenfield Savings Bank v. Commonwealth, 211 Mass. 207, 97 N. E. 927. But we fail to see the controlling effect of the nature of the proceeding upon the question of whether the receiver is in fact using, or is not using, any of the franchises of the corporation. Finally, upon the subject of whether receivers of mercantile corporations do exercise the corporate franchises, the language of the Supreme Court in United States v. Whitridge, 231 U. S. 144, 149, 34 S. Ct. 24, 25, 58 L. Ed. 159, seems to us controlling: "True, they [the receivers] may hold, for the time, all the franchises and property of the corporation, excepting its primary franchise of corporate existence. In the present cases, the receivers were authorized and required to manage and operate the railroads and to discharge the public obligations of the corporations *845 in this behalf. But they did this as officers of the court, and subject to the orders of the court; not as officers of the respective corporations, nor with the advantages that inhere in corporate organization as such. The possession and control of the receivers constituted, on the contrary, an ouster of corporate management and control, with the accompanying advantages and privileges." We conclude that here, also, the receiver cannot be said to have used or exercised any of the corporate franchises. It is contended of this decision, as shown by the case of Flint v. Stone Tracy Co., 220 U. S. 107, 31 S. Ct. 342, 55 L. Ed. 389, Ann. Cas. 1912B, 1312, that under the Federal Corporation Tax Law of 1909 (36 Stat. 112), the tax was imposed, not upon the franchises of the corporation irrespective of their use in business, but upon the actual doing of corporate business with all the advantages that inhere in such organizations; while here the tax is upon "the privilege" of engaging in such business. This is a distinction without a difference so far as regards a continuance of the existence of the "privilege" to do business. If the right or privilege to continue its corporate business is terminated or lost, and the receiver is not exercising that franchise, but rather powers otherwise acquired, there is no foundation upon which the tax may operate; and to all practical intents and purposes the corporation which has been shorn of all its property and facilities by a receivership has, for the period of the receivership, been ousted of its privilege to do business in corporate form, as well as of the actual conduct of its business, as completely as if an injunction had issued or the corporation had been placed in dissolution. Ohio v. Harris, supra. Thus the rationale of the decision in United States v. Whitridge, supra, applies in all its force to the present case. The dictum in Ohio v. Harris, supra, is disapproved, the decree of the District Court is reversed, and the cause is remanded for further proceedings. Should it appear that a surplus over indebtedness was payable by the receiver to stockholders, for and on account of their stock holdings, such fund would be chargeable with the claim of the state for franchise taxes, for, to this end alone, the corporate existence must be regarded as continued for the stockholders' benefit. But the state may share in the distribution of assets only if and after other creditors and the expenses of the receivership are paid in full. The holders of such claims neither had nor now have any possible interest in the preservation of the franchise. As to them the claim of the state is without that equity which would exist were the stockholders to benefit. Reversed and remanded. NOTES [1] No question of the construction of a state statute by the highest court of the state was there, or is here, involved. We do not therefore consider whether it is within the power of the state to levy a tax upon the receivers of the property of private corporations, measured by the amount of the outstanding capital and surplus, but without regard to the exercise by the receiver of any of the franchises of the corporation, or whether such a tax would be valid as to those receivers appointed by a federal court, as distinguished from those appointed by the state courts.	{ "pile_set_name": "FreeLaw" }
Opinion issued October 7, 2010 In The Court of Appeals For The First District of Texas ———————————— NO. 01-08-01011-CV ——————————— Clifford Smith, Appellant V. Galveston County, Appellee On Appeal from the 212th District Court Galveston County, Texas Trial Court Case No. 08-CV-0034 O P I N I O N Pro se inmate Clifford Smith sued Galveston County for negligence after he slipped in the jail shower and sustained injury. The county filed a plea to the jurisdiction in which it alleged that it was immune from Smith’s suit. The trial court granted the plea and dismissed Smith’s suit against the County. In one issue, Smith challenges the trial court’s dismissal by asserting that the County’s immunity from suit was waived. We affirm. Background On February 28, 2006, Smith was an inmate in the Galveston County Jail. He was housed in the part of the jail known as “Tank F.” Smith claimed that he slipped as he was getting out of the shower causing him to fall and hit a table. Smith alleged that he cut his lip and sustained other injuries in the fall. Smith sued Galveston County. He asserted that the County had been negligent for failing to place a non-skid floor covering “on the smooth concrete floor to prevent a person from slipping.” The County answered and filed a combined plea to the jurisdiction and motion for summary judgment. In its jurisdictional plea, the County asserted sovereign immunity from suit. The County contended, “[Smith] has failed to state a claim within the Texas Tort Claims Act, and therefore the Court is without jurisdiction over this case.” The County pointed out that, by its terms, the Tort Claims Act does not apply to acts or omissions that occurred before January 1, 1970. In support of its plea, the County offered evidence showing that Tank F was built in 1960 and that no modifications have been made to that part of the jail since its construction. Smith responded to the jurisdictional plea asserting that the County was “negligent in failing to provide a non-slip/skid floor covering and/or replace the non-slip/skid floor covering in front of the shower area and that as a result Plaintiff slipped, fell and suffered injury.” Smith pointed out that the Tort Claims Act waives immunity from suit for a personal injury caused by a condition or use of tangible personal or real property if the governmental unit would, were it a private person, be liable to the claimant according to Texas law. Smith claimed that the County’s housing of inmates at the jail facility constituted a use of real property and that his alleged injuries arose out of “a condition associated with the use of [the] real property.” More particularly, Smith asserted that the County knew of the hazardous nature of the shower floor but had failed to remedy it. Smith argued that the County’s knowledge of the floor’s condition was demonstrated by the County’s installation of non-skid flooring in the shower of the jail’s medical unit. Smith also offered evidence that other inmates had slipped in the Tank F shower. Smith addressed the County’s assertion that the Tort Claims Act does not apply to his claims because the shower floor has existed unmodified since 1960. Smith did not dispute that the Tort Claims Act does not waive sovereign immunity for claims arising from acts or omissions occurring before 1970. Instead, Smith asserted such exception did not apply here because the County “waived the defense of sovereign immunity” because it “chose to continue the occupation and utilization of the jail to house prisoners” after 1970. Following a hearing, the trial court granted the County’s jurisdictional plea and dismissed Smith’s claims against the County. This appeal followed. In one issue, Smith contends that the trial court erred by dismissing his suit. Plea to the Jurisdiction A. Scope and Standard of Review A plea to the jurisdiction based on sovereign immunity challenges the trial court’s subject matter jurisdiction. Tex. Dep’t of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 225–26 (Tex. 2004). Because subject matter jurisdiction is a question of law, we review de novo a trial court’s ruling on a plea to the jurisdiction. State v. Holland, 221 S.W.3d 639, 642 (Tex. 2007). The plaintiff bears the burden of alleging facts that affirmatively demonstrate that the trial court has subject matter jurisdiction over a case. Tex. Ass’n of Bus. v. Tex. Air Control Bd., 852 S.W.2d 440, 446 (Tex. 1993). When a plea to the jurisdiction challenges the sufficiency of plaintiff’s pleadings to confer jurisdiction, we determine whether the pleader has alleged facts that affirmatively demonstrate the court’s jurisdiction to hear the cause. See Miranda, 133 S.W.3d at 226. We construe the pleadings liberally in favor of the plaintiff and look to the pleader’s intent. Id. If the pleadings affirmatively negate the existence of jurisdiction, then a plea to the jurisdiction may be granted without allowing the plaintiff an opportunity to amend its petition. Id. at 227. In some instances, a plea to the jurisdiction may require the court to consider evidence pertaining to jurisdictional facts. See id.; Bland Indep. Sch. Dist. v. Blue, 34 S.W.3d 547, 555 (Tex. 2000). A plea should not be granted if a fact issue is presented regarding the court’s jurisdiction. Miranda, 133 S.W.3d at 227–28. But, if the relevant undisputed evidence negates jurisdiction, then the plea to the jurisdiction must be granted. Id. at 228. We must take as true all evidence favorable to the plaintiff and “indulge every reasonable inference and resolve any doubts in [his] favor.” Id. B. Analysis Sovereign immunity protects the state against lawsuits for money damages unless the state has consented to suit. See Mission Consol. Indep. Sch. Dist. v. Garcia, 253 S.W.3d 653, 655 (Tex. 2008); Miranda, 133 S.W.3d at 224. Governmental immunity operates like sovereign immunity to afford similar protection to subdivisions of the state, including counties, cities, and school districts, unless that immunity has been waived. Harris County v. Sykes, 136 S.W.3d 635, 638 (Tex. 2004); San Antonio Indep. Sch. Dist. v. McKinney, 936 S.W.2d 279, 283 (Tex. 1996). The Tort Claims Act waives a governmental unit’s sovereign immunity from suit to the extent that the governmental unit has liability under the act. Tex. Civ. Prac. & Rem. Code Ann. § 101.025 (Vernon 2005); City of Waco v. Kirwan, 298 S.W.3d 618, 622 (Tex. 2009). Section 101.061 of the act provides that immunity is not waived for claims based on an act or omission that occurred before January 1, 1970. Tex. Civ. Prac. & Rem. Code Ann. § 101.061 (Vernon 2005). When a party alleges waiver of immunity based on a condition or use of personal or real property, the governmental unit is entitled to immunity if it can prove that (1) the structure was completed before 1970 and (2) has remained in the same condition since that time. Rodriguez v. County of Cameron, No. 13-08-145-CV, 2009 WL 39091, at 2 (Tex. App.—Corpus Christi Jan. 8, 2009, no pet.) (mem. op.); Maxwell v. Tex. Dep’t of Transp., 880 S.W.2d 461, 465 (Tex. App.—Austin 1994, writ denied). Here, Smith alleges that his injuries occurred as a result of the slippery condition of the smooth concrete floor inside Tank F’s shower area. The County supported its jurisdictional plea with the affidavit of Mike Henson, Commander of the Corrections Division of the Galveston County Sheriff’s Department. His testimony indicated that Tank F was built in 1960 and that no modifications have been made to Tank F since its construction. Despite Tank F’s pre-1970 construction, Smith maintains that the Tort Claims Act’s waiver of immunity applies. He points out that the County made a decision to continue to use the jail after 1970. Smith offered evidence to show that, in conjunction with its continued use, the County knew that the shower floor was slippery and “hazardous.” Smith contends that, based on the County’s continued use and awareness of the hazardous condition, the County had a duty to install a non-skid floor covering in the shower area. A review of the case law indicates that Smith’s contention is without merit. Courts have consistently rejected similar arguments involving structures built before 1970. See, e.g., Maxwell, 880 S.W.2d at 465–66; Barron v. Tex. Dep’t of Transp., 880 S.W.2d 300, 302 (Tex. App.—Waco 1994, writ denied); Chapman v. City of Houston, 839 S.W.2d 95, 99 (Tex. App.—Houston [14th Dist.] 1992, writ denied). Texas courts have recognized that subjecting the government to liability under the Tort Claims Act for structures built before the act’s enactment, and not thereafter modified, would place the government in the unfeasible position of analyzing every structure under its control to determine whether it needed to be rebuilt, redesigned, or otherwise modified to defend against liability. See Rodriguez, 2009 WL 39091, at 3; Cranford v. City of Pasadena, 917 S.W.2d 484, 488 (Tex. App.—Houston [14th Dist.] 1996, no writ). We agree with other courts that in such cases, the actionable conduct occurs when the structure is built; the failure to provide additional safety features or devices after 1970 is not an act or omission within the meaning of the Tort Claims Act. See, e.g., Goodson v. City of Abilene, 295 S.W.3d 692, 695 (Tex. App.—Eastland 2009, no pet.); Maxwell, 880 S.W.2d at 466. Smith further asserts that the Tort Claims Act operates to waive immunity because the County “modified” the shower floor located in the jail’s medical unit. As noted by the County, this was not the location of Smith’s claimed injury. Smith alleges that he was injured in the Tank F shower. The record indicates that Tank F has remained unmodified since its construction in 1960. Even assuming that the placement of the non-skid flooring in the infirmary’s shower is of some significance, nothing in the record indicates that such modification occurred after 1970. See Rodriguez, 2009 WL 39091, at *3 (noting that affidavit which averred that a modification had been made to the structure at issue failed to show that modification was made after 1970). On this record, we conclude that section 101.061 precludes application of the Tort Claims Act to Smith’s claims. See Tex. Civ. Prac. & Rem. Code Ann. § 101.061. In addition, the County points to another section of the Tort Claims Act, which preserves its immunity. Section 101.056 provides that immunity is retained for discretionary decisions made by the government. See Tex. Civ. Prac. & Rem. Code Ann. § 101.056 (Vernon 2005). Section 101.056’s discretionary function provision is designed to “avoid judicial review or interference with those policy decisions committed to other branches of government.” See Stephen F. Austin State University v. Flynn, 228 S.W.3d 653, 657 (Tex. 2007). The provision generally preserves immunity not only for the government’s public policy decisions, but also for its failure to act when no particular action is required by law. See Tex. Civ. Prac. & Rem. Code Ann. § 101.056; Flynn, 228 S.W.3d at 657. Smith responds that the placement of non-skid flooring in Tank F’s shower was a non-discretionary, ministerial act.[1] Smith asserts that, once the County placed non-skid flooring in the medical unit’s shower, it had a ministerial duty to place similar flooring throughout the jail. Smith contends that installation of non-skid flooring in the Tank F shower was a maintenance activity and, as such, was ministerial. See City of Fort Worth v. Gay, 977 S.W.2d 814, 817 (Tex. App.—Fort Worth 1998, no pet.) (“Maintenance activities undertaken at the operational level are not discretionary functions and are not immune from liability.”). As suggested by the County, Smith’s argument is flawed. Smith has pled that the County was negligent for failing to install non-skid flooring in the tank F shower. In other words, Smith has alleged that the County was negligent for failing to install a safety feature that was not part of the original building construction. Installation of a safety feature that was not part of the original building design is not a maintenance activity; it is discretionary activity. See Barron, 880 S.W.2d at 302 (explaining that “maintenance” means that which is required to preserve a structure as it was originally designed and constructed; court determined that no evidence was presented in summary judgment proceeding to show that government had performed any maintenance after January 1, 1970 that contributed to plaintiff’s injury); Stanford v. State Dept. of Highways & Pub. Transp., 635 S.W.2d 581, 582 (Tex. App.—Dallas 1982, writ ref’d n.r.e.) (concluding that whether to add guardrails to overpass approach is design question, not a maintenance issue; thus, it is a discretionary function that makes decision exempt from liability). Courts have consistently held that decisions regarding the installation of safety features are discretionary determinations for which a governmental unit is immune. See, e.g., State v. San Miguel, 2 S.W.3d 249, 251 (Tex. 1999) (holding that decision to warn of missing guardrail with barrels and signs on a roadway is a discretionary decision); Wenzel v. City of New Braunfels, 852 S.W.2d 97, 99–100 (Tex. App.—Austin 1993, no writ) (concluding that adding additional lighting along parade route was discretionary governmental function protected by immunity from claims based on inadequate safety precautions). On point with this case, courts have held that failing to modify a pre-1970 structure to install a safety feature that was not part of the original structure is an exercise of a governmental unit’s discretion for which it retains immunity. See, e.g., Goodson, 295 S.W.3d at 696 (holding that city retained immunity because decision whether to modify balcony railing constructed in 1959, and never thereafter modified, was discretionary decision); Barron, 880 S.W.2d at 302 (concluding that state agency’s decision whether to rebuild original bridge, which was built in 1920s and upgraded in 1950s, was discretionary decision entitling agency to immunity from suit). Here, whether the County passively failed to install the non-skid flooring or actively chose not to install it, such act or omission was discretionary and not subject to the Tort Claims Act’s waiver of immunity. See Tex. Civ. Prac. & Rem. Code Ann. § 101.056. On this record, we conclude that the Tort Claims Act does not waive the County’s immunity from Smith’s suit. The trial court properly granted the County’s plea to the jurisdiction and dismissed Smith’s claims. We overrule Smith’s sole issue. Conclusion We affirm the judgment of the trial court. Laura Carter Higley Justice Panel consists of Justices Keyes, Higley, and Bland. [1] Smith does not allege that the County’s placement of non-skid flooring in the Tank F shower was required by law.	{ "pile_set_name": "FreeLaw" }
543 F.Supp.2d 1132 (2008) NORCAL GOLD, INC., a California corporation, Plaintiff-in-Interpleader, v. Steve C. LAUBLY; Bernadette Laubly; United States of America; and Internal Revenue Service, Defendants-in-Interpleader. No. CIV. 07-192 WBS KJM. United States District Court, E.D. California. February 5, 2008. 1134 Chris Gibson, Boutin Gibson Di Giusto Hodell Inc., Sacramento, CA, Paul J. Dutra, Dutra & Oates, Gold River, CA, for Plaintiff-in-Interpleader. Adam Ryan Smart, United States Department of Justice, Ben Franklin Station, Washington, DC, for Defendants-in-Interpleader. MEMORANDUM AND ORDER RE: MOTION FOR JUDGMENT ON THE PLEADINGS OR SUMMARY ADJUDICATION WILLIAM B. SHUBB, District Judge. This is an interpleader action involving a dispute over the remaining balance plaintiff-in-interpleader Norcal Gold, Inc., doing business as Re/Max Gold ("Norcal"), potentially owes pursuant to an asset purchase agreement. Norcal filed this action after receiving competing claims from defendants-in-interpleader Steve C. and Bernadette Laubly and the United States and Internal Revenue Service (IRS). I. Factual and Procedural Background For the tax years of 1997, 1998, 2000, and 2001, Steve Laubly individually filed income tax returns (Form 1040) and, based on his signed tax returns, a delegate of the Secretary of Treasury made assessments against him for unpaid federal income tax liabilities, penalties, and interest. (U.S.'s Mem. in Support of Motion for Jdmt. on the Pleadings ("U.S.'s Mem.") Exs. A-D.) As of December 20, 2006, the unpaid federal taxes, assessed and accrued interest, and other statutory additions totaled $69,946.22. (U.S.'s Answer ¶ 1.) The IRS recorded Notices of the Federal Tax Liens in Fresno County on April 1, 2003 for the tax year of 1997 and on March 15, 2005 for the tax years of 1998, 2000, and 2001. (U.S.'s Mem. Exs. E-F.) On July 28, 2004, IRS Officer Dennis D. Stiffler sent to Laubly, via certified mail, a Notice of Intent to Levy for the tax years of 1997, 1998, 2000, and 2001. (Stiffler Decl. ¶ 4.) On August 4, 2006, Norcal and the Laublys entered into an asset purchase agreement ("Agreement") in which Norcal agreed to pay the Laublys $100,000 in exchange for the Laublys' tangible and intangible assets used in their real estate brokerage business, Sundance Real Estate. (U.S.'s Mem. Ex. G.) The Agreement obligated Norcal to pay $50,000 on the August 24, 2006 closing date and the remaining $50,000 on January 15, 2007. (Stiffler Decl. ¶¶ 2, 6.) The Laublys also covenanted that they had timely paid all taxes and that there were no liens or encumbrances on the assets. (Id. at ¶ 4.) On November 21, 2006, Stiffler hand-delivered two tax collection notices (IRS Letters 3174 and 3164(B)) to Laubly's residence. (Id. at ¶ 5, Exs. 1-2.) In a phone conversation with Laubly that same day, Stiffler informed him that the IRS would issue a levy on the proceeds of the Laublys' sale of their business. (Id. at ¶ 6.) Eight days later, the IRS received a seven-page letter from Laubly that attacked the government's authority to levy a tax on private employment income and to enforce a lien to collect such tax. (Id. at Ex. 3.) On November 22, 2006, the IRS issued a Notice of Levy to Norcal, which stated that the IRS had a levy against Laubly for $69,946.22. (Compl.-in-Interpleader ¶ 11; U.S.'s Mem. Ex. H.) Four days later, Laubly 1135 sent Norcal a letter claiming that the Notice of Levy was "unlawful, unconstitutional and improper." (Id. at ¶ 13.) The letter also stated that if Norcal paid the $50,000 balance to the IRS, Laubly would consider Norcal as "choosing to engage in collusion and conspiracy, to defraud [him] and engage in conversion of his personal property. ..." (Id.) On January 19, 2007, the IRS issued a Final Demand for Payment to Norcal. (U.S.'s Mem. Ex. I.) On January 30, 2007, Norcal initiated this interpleader action seeking to force the defendants-in-interpleader to litigate their rights to the $50,000 balance due under the Agreement. Norcal also alleges claims for recision, restitution, and damages for fraud against the Laublys. In its Answer, the United States asserted a claim to any funds Norcal owes Laubly pursuant to the Agreement. While the Laublys filed a pro se answer to the complaint-in-interpleader, they neither asserted a claim to the funds nor answered the United States' cross-claim. Pursuant to Federal Rule of Civil Procedure 12(c), the United States now moves for judgment on the pleadings to establish that 1) the levy the IRS asserts against Laubly is lawful and 2) the United States assumes all rights Laubly has under the Agreement. Alternatively, the United States moves for summary adjudication on the same issues. Norcal filed a non-opposition to the United States' motion.[1] II. Discussion Pursuant to Federal Rule of Civil Procedure 12(c), "[a]fter the pleadings are closed but within such time as not to delay the trial, any party may move for judgment on the pleadings." Fed.R.Civ.P. 12(c). For purposes of Rule 12(c), the pleadings are "closed" only when the parties have filed all of the pleadings Rule 7(a) contemplates. See id. Rule 7(a) ("There shall be a complaint and an answer;... an answer to a cross-claim, if the answer contains a cross-claim ...."); In re Villegas, 132 B.R. 742, 745 (9th Cir.BAP 1991) ("Pleadings are not closed until at least an answer has been filed .... Judgment on the pleadings may not be entered where no answer has been filed."). Accordingly, because the Laublys have not answered the United States' cross-claim, Rule 12(c) does not permit the United States to move for judgment on the pleadings. A party can, however, move for summary adjudication "at any time after the expiration of 20 days from the commencement of the action. ..." Fed. R.Civ.P. 56(a). The standard that applies to a motion for summary adjudication is 1136 the same as that which applies to a motion for summary judgment. See id. Rule 56(a), (c); Mora v. Chem-Tronics, Inc., 16 F.Supp.2d 1192, 1200 (S.D.Cal.1998). Summary adjudication is proper "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). A material fact is one that could affect the outcome of the suit, and a genuine issue is one that could permit a reasonable jury to enter a verdict in the non-moving party's favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The party moving for summary adjudication bears the initial burden of establishing the absence of a genuine issue of material fact and can satisfy this burden by presenting evidence that negates an essential element of the non-moving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Alternatively, the movant can demonstrate that the non-moving party cannot provide evidence to support an essential element upon which it will bear the burden of proof at trial. Id. Once the moving party meets its initial burden, the non-moving party must "go beyond the pleadings and by her own affidavits, or by `the depositions, answers to interrogatories, and admissions on file,' [and] designate `specific facts showing that there is a genuine issue for trial.'" Id. at 324, 106 S.Ct. 2548 (quoting Fed.R.Civ.P. 56(e)). The non-movant "may not rest upon the mere allegations or denials of the adverse party's pleading." Fed.R.Civ.P. 56(e); Valandingham v. Bojorquez, 866 F.2d 1135, 1137 (9th Cir.1989). However, any inferences drawn from the underlying facts must be viewed in the light most favorable to the non-moving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). Additionally, the court must not engage in credibility determinations or weigh the evidence. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). "In an action to collect tax, the government bears the initial burden of proof. The government, however, may satisfy this initial burden by introducing into evidence its assessment of taxes due" and providing a "minimal factual foundation" for the assessment. Oliver v. U.S., 921 F.2d 916, 919-20 (9th Cir.1990) (internal citations omitted). Unless the assessment is "without rational foundation or is arbitrary," "introduction of the assessment establishes a prima facie case" for the government. Id. Once "the government satisfies its initial burden by introducing the assessment ..., the taxpayer then has the burden of proof to challenge the government's claim that the tax is due. Id. The United States has produced Certificates of Assessments, Payments, and Other Specific Matters (Form 4340) ("Certificates of Assessments") for the tax years of 1997, 1998, 2000, and 2001. (U.S.'s Mem. Exs. A-D; see also U.S.'s Answer 7 (Laubly owes $69,946.22 as of December 20, 2006).) Factually, the assessments were based on liabilities established in Laubly's individually-filed income tax returns (Form 1040), which he signed under penalty of perjury. (U.S.'s Mem. Exs. A-D.) The Certificates of Assessments also establish that the tax liabilities were properly assessed by a duly authorized Secretary of Treasury, 26 U.S.C. §§ 6201-6203, and that the notices and demands for payment of the liabilities were properly sent to Laubly and included the "23c date." Id. §§ 6303(a), 6321; Huff v. United States, 10 F.3d 1440, 1445-46 1137 (9th Cir.1993) (requiring that Certificates of Assessments include the "23C date"). The United States' recorded tax liens are also valid. (See U.S.'s Mem. Exs. E, F.) "When a taxpayer neglects or refuses to pay a federal tax liability after assessment, notice, and demand for payment, § 6321 imposes a tax lien in favor of the government for `all property and rights to property, whether real or personal' belonging to the taxpayer." United States v. Cunningham, No. 04-2483, 2006 WL 1628010, at 5 (E.D.Cal. June 7, 2006) (quoting § 6321) (citing Drye v. United States, 528 U.S. 49, 55, 120 S.Ct. 474, 145 L.Ed.2d 466 (1999)). While Laubly does not oppose the United States' motion for summary adjudication, he has stated his position regarding the IRS levy in the Answer he filed with his wife. Laubly alleges that the "IRS has no authority to make plaintiff[-in-interpleader] or defendant[-in-interpleader] Laubly liable for the subject tax within the several states" and that the levy is an "unlawful security filed in the public record against defendant[-in-interpleader] Laubly." (Laublys' Answer ¶¶ 14-5.) In his detailed letter to the IRS, Laubly also elaborates that 1) "Congress does not have the authority to levy a direct tax on" private employment income; 2) the Secretary of the Treasury does not have the authority to assess private employment earnings as income; and 3) the IRS does not have the authority to place a lien on property or enforce income and employment tax laws. (Stiffler Decl. Ex. 3.) However, because Laubly does not attack the procedural validity of the assessments, any claims that can be attributed to him are not cognizable in this action. Specifically, 28 U.S.C. § 2410 permits "`actions challenging the procedural aspects of tax liens, but not the merits of the underlying tax assessments.'" Huff, 10 F.3d at 1445-46 (quoting Arford v. United States, 934 F.2d 229, 232 (9th Cir.1991)). "To the extent that [Laubly] challenge[s] the merits of [his] underlying requirement to pay [the] taxes[,] ... the district court... does not have jurisdiction." James v. United States, 970 F.2d 750, 754 (10th Cir.1992); see also id. ("`[W]hatever narrow jurisdiction may lie under § 2410 does not extend to an omnibus challenge to the authority of the Internal Revenue Service to function.'") (citation omitted). Laubly's arguments do not attack the procedural validity of the assessments because he neither denies that he received the Certificates of Assessments and requisite notices nor "present[s] evidence suggesting that the information in the [Certificates of Assessments or notices was] inaccurate." See Huff, 10 F.3d at 1445 ("This court has held that claims regarding both the failure by the IRS properly to assess a tax and to provide a taxpayer with a copy of an assessment under § 6203, and the failure to send a notice of assessment and a demand for payment under § 6303(a) present procedural challenges to the validity of a lien and are therefore cognizable under § 2410."); see also id. ("[The Certificates of Assessments] provide[] at least presumptive evidence that a tax has been validly assessed under § 6203.") (citations omitted). Laubly is also not entitled to seek an injunction against the IRS because "it has been established law that payment of the tax followed by a suit for refund constitutes an adequate remedy at law." Cool Fuel, Inc. v. Connett, 685 F.2d 309, 314 (9th Cir.1982) (citing Bailey v. George, 259 U.S. 16, 42 S.Ct. 419, 66 L.Ed. 816 (1922)); see also Pulliam v. Allen, 466 U.S. 522, 537, 104 S.Ct. 1970, 80 L.Ed.2d 565 (1984) (an inadequate remedy at law is a prerequisite to an injunction). Accordingly, because there is no genuine issue of material fact with respect to the 1138 United States' claim that the IRS levy is lawful, this court must grant the United States' motion for summary adjudication on that issue. "In a levy proceeding, the IRS `steps into the taxpayer's shoes,' [and it] acquires whatever rights the taxpayer himself possesses." U.S. v. Nat'l Bank of Commerce, 472 U.S. 713, 725-26, 105 S.Ct. 2919, 86 L.Ed.2d 565 (1985) (citations omitted). When a taxpayer has claims entitling him to money or property, "the government may foreclose upon the taxpayers' causes of action just as it could any other real or' personal property. A taxpayer's chose in action represents one of the taxpayer's assets, and the government has the right to pursue the action to judgment...." U.S. v. Stonehill, 83 F.3d 1156, 1160 (9th Cir.1996). Accordingly, because there is no genuine issue of material fact that the United States assumes all rights Laubly has under the Agreement, the court must also grant the United States' motion for summary adjudication on that issue. IT IS THEREFORE ORDERED that the United States' motion for summary adjudication with respect to the validity of the IRS levy and its entitlement to any funds Laubly may recover under the Agreement be, and the same hereby is, GRANTED. NOTES [1] On January 31, 2008, nine days after opposition to the United States' motion was due, the Laublys filed a "Demand for a Jury Trial and Objection to the United State[s'] Request for Summary Judgment." The entirety of the Laublys' objection to the United States' motion consisted of one conclusory sentence: "Defendants[in-interpleader] hereby respectfully move the court to deny the summary judgment requested by the United States on the basis that it will deny the defendants[in-interpleder] their civil rights, and their right to due process." (Laublys' Demand for Jury Trial & Objection to U.S.'s Mot. for Summ. J. 2:6-9.) The United States submitted its motion "upon the record and briefs on file" and requested that the court issue its order without oral argument. E. Dist. of Cal. Local R. 78-230(h). The court has determined that it does not need to hear oral argument, and accordingly decides the motion on the papers. The Laublys were not entitled to oral argument because, even if the court construes their January 31, 2008 filing as an opposition to the United States' motion, it was not timely filed. See id. at Rule 78-230(c) ("No party will be entitled to be heard in opposition to a motion at oral arguments if opposition to the motion has not been timely filed by that party.").	{ "pile_set_name": "FreeLaw" }
862 F.2d 878 Mabsonv.Abbey* NO. 88-5119 United States Court of Appeals,Eleventh Circuit. NOV 14, 1988 1 Appeal From: S.D.Fla. 2 AFFIRMED. * Fed.R.App.P. 34(a); 11th Cir.R. 23	{ "pile_set_name": "FreeLaw" }
965 S.W.2d 30 (1998) Nikalai DICKERSON, Appellant, v. The STATE of Texas, Appellee. No. 01-95-00946-CR. Court of Appeals of Texas, Houston (1st Dist.). February 19, 1998. Rehearing Overruled March 3, 1998. Belinda Johnson Chagnard, Henry L. Burkholder, III, Houston, for Appellant. *31 John B. Holmes, Alan Curry, Houston, for Appellee. Before WILSON, MIRABAL and TAFT, JJ. OPINION WILSON, Justice. Appellant, Nikalai Dickerson, was charged by information with the offense of driving while intoxicated. After his motion to suppress was denied, appellant pled guilty with an agreed recommendation from the State, and was sentenced to 40 days in jail. In five points of error, appellant argues the trial court erroneously denied his motion to suppress. We affirm. Facts The following facts were developed from a stipulation of evidence between the parties. Deputy Russell Swango, an accident investigator for the Harris County Sheriff's Department, investigated a motor vehicle accident on the morning of March 4, 1994. At the accident scene, Ricardo Lopez told Swango that appellant passed him at a high rate of speed and then drifted across the highway dividing line. Appellant's car then struck a car traveling in the opposite direction, resulting in a four-car collision. The EMS personnel on the scene did not report an odor of alcohol on appellant's breath, and Deputy Swango did not find any containers of alcoholic beverages. Appellant was taken to the hospital, and blood tests were conducted for medical purposes. As part of his investigation, Deputy Swango went to the District Attorney's Office and requested a grand jury subpoena to get the results of appellant's drug and alcohol tests performed at the hospital. The medical records revealed that appellant had.105 blood alcohol content. At the time the subpoena was issued, there were no criminal proceedings pending against appellant. After the State filed charges, appellant filed a motion to suppress the medical records obtained by Swango. The trial court held a hearing and overruled appellant's motion. Suppression of Medical Records In five points of error, appellant contends the trial court erred by not suppressing evidence of hospital records of his blood alcohol test results because: (1) appellant had a reasonable expectation of privacy under the Fourth Amendment; (2) appellant had a statutory right of privacy based on TEX. HEALTH & SAFETY CODE ANN. § 773.091(b) (Vernon 1992); (3) the grand jury subpoena was defective for not directing any person to appear before the grand jury; (4) the grand jury subpoena was not issued by a neutral and detached magistrate; and (5) the grand jury subpoena did not authorize the executing officer to seize evidence. The Court of Criminal Appeals recently addressed the precise issues raised in appellant's first two points of error in State v. Hardy, 963 S.W.2d 516 (Tex.Crim.App. 1997). Under facts indistinguishable from our facts, the court held there was no Fourth Amendment reasonable expectation of privacy and no statutory physician-patient privilege of confidentiality that protects the record of blood test results of an injured motorist from being given to law enforcement officers pursuant to a grand jury subpoena. Id., at 523, 527. Accordingly, we overrule appellant's first two points of error. In the absence of any constitutional or statutory reasonable expectation of privacy, appellant has no standing to complain of defects in the grand jury subpoena process. See State v. Comeaux, 818 S.W.2d 46, 51 (Tex.Crim.App. 1991). Therefore, we also overrule appellant's third, fourth, and fifth points of error raising such defects. We affirm the trial court's judgment.	{ "pile_set_name": "FreeLaw" }

Subsets and Splits

No community queries yet

The top public SQL queries from the community will appear here once available.