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Showing posts with label 2nd circuit. Show all posts

21 January 2015

Law in Plain English: Gelboim v. Bank of America Corporation

Argument: Dec 9 2014 (Aud.)

Background: Ellen Gelboim filed a lawsuit against Bank of America and other financial institutions alleging that they colluded to manipulate the London Interbank Offer Rate (LIBOR), a daily interest rate benchmark that is used to help set the interest rate of financial transactions across the globe. Gelboim’s case was consolidated with a number of other similar cases (four from the Southern District of New York, and three from the Northern District of Illinois) in New York for pre-trial purposes. During the pre-trail phase, the district court dismissed a number of the cases, including Gelboim’s, for failure to state a claim. Gelboim appealed, but the Second Circuit dismissed Gelboim’s appeal and held that it lacked jurisdiction over the appeal because the district court had not entered a final order concerning all the claims in the consolidated action.

Issue: The question before the Court is whether and in what circumstances the dismissal of an action that has been consolidated with other suits is immediately appealable.

Holding: In a unanimous decision, the Supreme Court ruled that the order dismissing the case in its entirety removed Gelboim from the consolidated proceeding, thereby triggering his right to appeal under §1291.

29 September 2014

Law in Plain English: Public Employees’ Retirement System of Mississippi v. IndyMac MBS, Inc.

Argument: ~~Oct 6 2014 (Aud.)~~

Background: In American Pipe & Construction Co. v. Utah, the Supreme Court held that the commencement of a class action suspends the applicable statute of limitations as to all asserted members of the class who would have been parties had the suit been permitted to continue as a class action. In this case, two securities class action lawsuits were filed against IndyMac, alleging violations of the Securities Act. The district court dismissed all claims because the original lead and sole named plaintiffs (a group of Wyoming entities) could not demonstrate standing. The dismissed claims included those involving securities purchased by other members of the asserted class (including the Public Employees' Retirement System of Mississippi, PERS), but none of whom were named plaintiffs in the original class action. PERS and other municipal retirement systems moved into intervene. Although the three-year period of repose in Section 13 had run on their claims, these plaintiffs invoked the tolling rule set forth in American Pipe. The district court denied the motions to intervene. The Second Circuit affirmed, distinguishing between a statute of limitations (which is subject to equitable considerations such us tolling) and a statute of repose (which is considered an absolute limitation).

Issue: The question before the Court is whether the filing of a putative class action serves, under American Pipe & Construction Co. v. Utah, to satisfy the three year time limitation in § 13 of the Securities Act with respect to the claims of putative class members.

Holding: The Supreme Court dismissed the writ of ceriorari as improvidently granted.

25 June 2014

Law in Plain English: ABC, Inc. v. Aereo, Inc.

Argument: Apr 22, 2014 (Aud.)

Aereo's array of dime-sized antennas.

Discussion: Aereo uses thousands of individual antennas to receive broadcast television channels, and Aereo assigns an individual antenna to each of its subscribers. Aereo transmits to its subscribers broadcast television programs over the internet for a monthly subscription fee, but it does not have any license from copyright holders to record or transmit their programs. The 1976 Copyright Act gives copyright owners an exclusive right "in the case of literary, musical, dramatic, and choreographic works, pantomimes, and motion pictures and other audiovisual works, to perform the copyrighted work publicly." 17 U.S.C. § 106(4). ABC and other holders of copyrights in programs broadcast on network television moved for a preliminary injunction barring Aereo from transmitting programs to its subscribers while the programs are still airing, claiming that those transmissions infringe their exclusive right to publicly perform their works, as defined by 17 U.S.C. § 101. The District Court denied the motion. It concluded that, although the Plaintiffs had demonstrated a likelihood that they would suffer irreparable harm in the absence of a preliminary injunction,an injunction would severely harm Aereo, likely ending its business. The balance of hardships did not tip "decidedly" in favor of the Plaintiffs and an injunction "would not disserve the public interest." The Second Circuit affirmed, finding that Aereo's transmissions of unique copies of broadcast television programs created at its users' requests and transmitted while the programs are still airing on broadcast television are not "public performances" of the Plaintiffs' copyrighted works.

Issue: The question before the Court is whether a company “publicly performs” a copyrighted television program when it retransmits a broadcast of that program to thousands of paid subscribers over the Internet.

Holding: In a 6-3 decision, the Supreme Court ruled that Aereo performs petitioners’ works publicly within the meaning of the Transmit Clause. The practical impact of this decision is that Aereo's business model is illegal.

16 June 2014

Law in Plain English: Republic of Argentina v. NML Capital

Argument: Apr 21 2014 (Aud.)

Background: In December 2001, the Republic of Argentina defaulted on payment of its external debt. While most of Argentina's bondholders agreed to voluntary restructurings in 2005 and 2010, others, including Plaintiff-Appellee NML Capital, Ltd. ("NML"), did not. NML filed eleven actions in the Southern District of New York to collect on its defaulted Argentinian bonds. The district court has entered five money judgments in NML's favor totaling (with interest) approximately $1.6 billion; and summary judgment to NML in the remaining six actions, in which NML's claims total (with interest) more than $900 million. Argentina has not satisfied these judgments and NML has thus attempted to execute them against Argentina's property. NML sought discovery of all bank accounts maintained by or on behalf of Argentina without territorial limitation. The district court approved a subpoena indicating that extraterritorial asset discovery did not infringe on Argentina's sovereign immunity, but limited the subpoena to discovery that was reasonably calculated to lead to attachable property. Argentina appealed, arguing that the district court's discovery order, by compelling disclosure about Argentinian assets abroad, violated the Foreign Sovereign Immunities Act ("FSIA"). The Second Circuit affirmed, holding that because the discovery order involves discovery, not attachment of sovereign property, and because it is directed at third-party banks, not at Argentina itself, Argentina's sovereign immunity was not infringed.

Issue: The question before the Court is whether post-judgment discovery in aid of enforcing a judgment against a foreign state can be ordered with respect to all assets of a foreign state regardless of their location or use, as held by the Second Circuit, or is limited to assets located in the United States that are potentially subject to execution under the Foreign Sovereign Immunities Act of 1976 (“FSIA”), 28 U.S.C. § 1602 et seq., as held by the Seventh, Fifth, and Ninth Circuits.

Holding: In a 7-1 decision (with Justice Sotomayor recused), the Supreme Court ruled that no provision of the Foreign Sovereign Immunities Act immunizes a foreign sovereign debtor from post-judgment discovery of information concerning its extraterritorial assets.

05 May 2014

Law in Plain English: Town of Greece v. Galloway

Argument: Nov 6 2013 (Aud.)

Background: Since 1999, the Town of Greece, New York, has begun its Town Board meetings with a short prayer. In 2008, Galloway and other town residents brought suit against the town, asserting that aspects of this prayer practice violated the First Amendment's Establishment Clause. The District Court rejected the claim and ruled for the town. The Second Circuit reversed, concluding that an objective, reasonable person would believe that the town's prayer practice had the effect of affiliating the town with Christianity. The Government filed an amicus brief supporting the position of the town.

Issue: The question before the Court is whether the Court of Appeals erred in holding that a legislative prayer practice violates the Establishment Clause notwithstanding the absence of discrimination in the selection of prayer-givers or forbidden exploitation of the prayer opportunity.

Holding: In a 5-4 decision, the Supreme Court ruled that the town’s prayer practice does not violate the Establishment Clause. Legislative prayer, while religious in nature, has long been understood as compatible with the Establishment Clause, and insistence on nonsectarian prayer is not consistent with this tradition.

05 March 2014

Law in Plain English: Lozano v. Alvarez

Argument: Dec 11 2013 (Aud.)

Discussion: Diana Lucia Montoya Alvarez ("Alvarez") and Manuel Jose Lozano ("Lozano"), both originally from Colombia, met and began dating in London in early 2004. Alvarez claimed Lozano was abusive. Despite this, they had a child together. In 2008, shortly after visiting her sister Maria in New York, Alvarez left the couple's apartment to bring the child to nursery school and never returned. For the next seven months, Alvarez and the child resided at a women's shelter. In early July of 2009, Alvarez and the child left the United Kingdom, eventually traveling to New York, where they have lived since that time. In New York, Alvarez and the child lived with Alvarez's sister Maria, along with Maria's partner, daughter, and granddaughter. She eventually overstayed her visa. On November 10, 2010, Lozano filed a Petition for Return of Child pursuant to Article 2 of the Hague Convention and the International Child Abduction Remedies Act, 42 U.S.C. § 11603 (2005) (ICARA), in the United States District Court for the Southern District of New York, requesting an order requiring that the child be returned to London to have a British court make a custody determination. The District Court concluded that Lozano had made out a prima facie case of wrongful retention under [the Hague Convention because: (1) the child was a habitual resident of the United Kingdom; (2) Alvarez's unlawful removal of the child breached Lozano's custody rights under English law; and (3) Lozano exercised parental rights at the time the child was removed. However, the court found that ICARA's one year statute of limitations had expired. Lozano argued that the statute of limitations should have been subject to equitable tolling until the time Lozano reasonably could have learned of his child's whereabouts, but the court disagreed. The Second Circuit affirmed.

Issue: The questions before the Court are (1) Whether a district court considering a petition under the Hague Convention on the Civil Aspects of International Child Abduction for the return of an abducted child may equitably toll the running of the one-year filing period when the abducting parent has concealed the whereabouts of the child from the left-behind parent; and (2) whether an abducted child can be “settled” in the United States, within the meaning of Article 12 of the Convention, where it is undisputed that both the abducting parent and the child are residing illegally in the United States, and the abducting parent presents no evidence of a legitimate pending application or basis under existing law for seeking a change in their immigration status.

Holding: In a 9-0 decision, the Supreme Court ruled that under the Hague Convention, the one-year period for filing a petition for the child's removal is not subject to equitable tolling.

16 December 2013

Law in Plain English: Heimeshoff v. Hartford Life & Accident Insurance Co. and Wal-Mart Stores, Inc.

Argument: Oct 15 2013 (Aud.)

Background: Heimeshoff filed for long-term disability benefits under Employee Retirement Income Security Act (ERISA), but the insurance company denied her claim. The District Court then dismissed her complaint because it fell outside of the insurance policy's three-year statute of limitations period. Heimeshoff alleged that the statute of limitations should not have run until her claim was denied by the insurance company; on the other hand the insurance company's plan provided that its three-year limitations period ran from the time that proof of loss was due under the plan (an earlier period). The Second Circuit affirmed.

Issue: The question before the Court is when should a statute of limitations accrue for judicial review of an disability adverse benefit determination under the Employee Retirement Income Security Act?

Holding: In a unanimous decision, the Supreme Court ruled that the plan's limitations provision is enforceable. Statutes of limitations provide only a default rule that permits parties to choose a shorter limitations period (although, to be clear, §ERISA 502(a)(1)(B) does not specify a statute of limitations). Parties can agree not only to the length of a limitations period but also to its commencement. As a result, the Court affirmed the Second Circuit and Heimeshoff's disability claim was denied. The practical impact of this decision is that contractual limitations provisions of the kind in this ERISA plan are enforceable so long as the limitations period is of reasonable length and there is no controlling statute to the contrary.

08 September 2013

Do American criminal laws apply to conduct abroad?

In Morrison v. National Australia Bank Ltd., 130 S. Ct. 2869, Justice Scalia, writing for the Court, wrote that "[i]t is a longstanding principle of American law that legislation of Congress, unless a contrary intent appears, is meant to apply only within the territorial jurisdiction of the United States." This is known as the Extraterritoriality Canon. A statute presumptively has no extraterritorial application (statuta suo clauduntur territorio, nec ultra territorium disponunt, p. 268 of Justice Scalia and Bryan Garner's Reading Law: The Interpretation of Legal Texts).

I previously wrote about this canon here and here.

In Kiobel v. Royal Dutch Petroleum, Chief Justice Roberts's majority opinion relied primarily on this canon in concluding that the Alien Tort Statute does not apply to the alleged conduct:

We therefore conclude that the presumption against extraterritoriality applies to claims under the ATS, and that nothing in the statute rebuts that presumption. "[T]here is no clear indication of extraterritoriality here," Morrison, 561 U. S., at ___ (slip op., at 16), and petitioners' case seeking relief for violations of the law of nations occurring outside the United States is barred.

Morrison was about civil laws--but what about criminal violations? Late last month, the Second Circuit ruled that he presumption against extraterritoriality applies:

Section 10(b) and its implementing regulation, Rule 10b-5 [of the Securities Exchange Act of 1934], do not apply to extraterritorial conduct, regardless of whether liability is sought criminally or civilly. Accordingly, a defendant may be convicted of securities fraud under Section 10(b) and Rule 10b-5 only if he has engaged in fraud in connection with (1) a security listed on a U.S. exchange, or (2) a security purchased or sold in the United States.

For more on this case, see here.

26 June 2013

Law in Plain English: Sekhar v. United States

Sekhar threatened to expose an alleged extra-marital affair if a lawyer for the state of New York did not give legal advice that could benefit Sekhar’s financial interests. As a result, the government charged Sekhar with violating the Hobbs Act, a federal law enacted in 1946 that makes it a crime to take someone else’s property by the use of a threat of force or violence. A jury convicted Sekhar, and the Second Circuit affirmed. The question before the Court was whether the "recommendation" of an attorney, who is a salaried employee of a governmental agency, in a single instance, is intangible property that can be the subject of an extortion attempt under the Hobbs Act. In a 9-0 decision, the Supreme Court ruled that attempting to compel a person to recommend that his employer approve an investment does not constitute the obtaining of property from another under the Hobbs Act. As a result, Sekhar's convicted was reversed. The practical impact of this decision is that the Hobbs Act will not be able to be used in similar circumstances to Sekhar's case.

Law in Plain English: United States v. Windsor

This is one in a series of posts designed to describe court decisions in plain English. For more detail and background on the legal issues, see the link to the case below. For similar posts, click here.

My preview of the Windsor case is here.

United States v. Windsor

Windsor married her spouse in Canada, but New York (where she lived) did not recognize same sex marriage. After her spouse died, she filed suit, claiming that she was denied the spousal deduction for federal estate taxes because the Defense of Marriage Act (DOMA) defines marriage as being between a man and a woman. Both the District Court and the Second Circuit decided in Windsor's favor, finding DOMA unconstitutional. Three months after Windsor's suit, the federal government also decided to stop enforcing DOMA, believing (as the courts in this case did) that DOMA was unconstitutional. The House of Representative's Bipartisan Legal Advisory Group (BLAG) moved to intervene on behalf of the United States. The results below, and this decision by the federal government, raised the questions before the Court: First, whether the federal government's decision not to defend DOMA took away jurisdiction from the Supreme Court to hear the case (BLAG argues that because the Second Circuit's decision in favor of Windsor was in line with the government's new position not to defend DOMA, the government prevailed and cannot appeal; the government argues otherwise); second, whether BLAG had standing to defend DOMA (because, arguably, their interest in seeing the law enforced does not rise to the level of a specific injury); and third, whether DOMA itself was unconstitutional by violating the Fifth Amendment's guarantee of equal protection. In a 5-4 decision, the Supreme Court ruled that DOMA is unconstitutional as a deprivation of the equal liberty of persons that is protected by the Fifth Amendment. The practical impact of this decision is that the federal government cannot deny benefits to same-sex couples.

20 June 2013

Law in Plain English: Agency for Int'l Development v. Alliance for Open Society Int'l, Inc.

Passed by Congress in 2003, the U.S. Leadership Against HIV/AIDS, Tuberculosis, and Malaria Act contains a provision which requires that recipients of its funding make an explicit policy opposing prostitution and sex trafficking. Alliance for Open Society Int'l, Inc. and several other organizations who received funding objected to making this policy statement on the grounds that it violated their free speech (to be clear--these organizations do not explicitly support prostitution and sex trafficking, but fear that publicly opposing them will hurt their efforts). In return, the Government argues that these private organizations have a choice to participate in the program, and in offering a choice does not offend the organization's First Amendment rights. The lower courts have found this explicit policy provision to unlawfully compel or coerce speech. The question before the Court was whether the Act, which requires an organization to have a policy explicitly opposing prostitution and sex trafficking in order to receive federal funding to provide HIV and AIDS programs overseas, violated the First Amendment. In a 6-2 decision (with Justice Kagan recused), the Supreme Court ruled the Policy Requirement violates the First Amendment by compelling as a condition of federal funding the affirmation of a belief that by its nature cannot be confined within the scope of the Government program. As a result, the recipients of the funds do not have to make such policy statements. The practical impact of this decision is that the Government is limited its in power to demand that funding recipients adopt and espouse, as their own, the Government’s view on an issue of public concern, when that requirement affects protected conduct outside the scope of the federal funded program.

Law in Plain English: American Express Co. v. Italian Colors Restaurant

Italian Colors Restaurant and other merchants (in a class action) alleged that as a condition of accepting American Express (AmEx) charge cards, they were forced to accept AmEx credit cards and debit cards at higher rates than competitors' credit cards and debit cards. Pursuant to a prior agreement which included a class action waiver, AmEx sought arbitration. The District Court found in favor of AmEx. The Second Circuit reversed, finding that the class action waiver was unenforceable because if the provision were enforced it would strip the plaintiffs of rights accorded them by statute. The question before the Court was whether the Federal Arbitration Act (FAA) permits courts, invoking the “federal substantive law of arbitrability,” to invalidate arbitration agreements on the ground that they do not permit class arbitration of a federal-law claim. In a 5-3 decision (Justice Sotomayor recused, because she participated in the decision at the Second Circuit), the Supreme Court ruled that the FAA does not permit courts to invalidate a contractual waiver of class arbitration on the grounds that the plaintiff’s cost of individually arbitrating a federal statutory claim exceeds the potential recovery. As a result, the merchants' class action is precluded by the arbitration agreement. The practical impact of this decision is that courts must enforce arbitration agreements for claims, even for claims alleging a violation of a federal statute, unless the FAA’s mandate has been overridden by a contrary congressional command.

19 March 2013

Law in Plain English: Kirtsaeng v. John Wiley & Sons

Kirtsaeng v. John Wiley and Sons

Kirtsaeng moved from Thailand to the United States. He asked friends and family to buy foreign edition English-language textbooks in Thailand (where the prices were cheaper), and to mail them to him in the United States. He then sold the books, and kept the profit. Wiley sued Kirtsaeng, alleging copyright violation. Kirtsaeng claimed reselling the books was a limitation to Wiley's exclusive rights under the first sale doctrine (codified at 17 U.S.C. 109(a)). The question before the Court was whether the first sale doctrine applies to works made abroad and then imported into the United States. In a 6-3 decision, the Supreme Court ruled that the phrase "lawfully made under this title" in Section 109(a) had no geographic limitation. As a result, the the first sale doctrine does in fact apply to works made aboard and then imported into the United States. The practical impact of this decision is to give consumers greater flexibility in taking advantage of the first sale doctrine.

Incidentally, I'm not at all disappointed to report that this is my first incorrect prediction of the term:

#SCOTUS prediction: Kirtsaeng v. John Wiley & Sons, Inc. <--bit.ly/U5Rlqx
— theprez98 (总统) (@theprez98) December 24, 2012

I was pessimistic about the outcome. Personally I think Justice Ginsburg's dissent is a better reading of current copyright law, but I'm not going to object.

27 February 2013

Law in Plain English: Gabelli v. SEC

This is one in a series of posts designed to describe court decisions in plain English. For more detail and background on the legal issues, see the link to the case below. For similar posts, click here.

Gabelli v. SEC

Gabelli was charged with violating a federal law by defrauding his clients. The statute of limitations required that charges be "commenced within five years from the date when the claim first accrued." The question here was "when the claim first accrued" meant when the fraud actually occurred, or when it was discovered. In a unanimous opinion, the Supreme Court ruled that the natural reading of the law required the statute of limitations began when the fraud actually occurred. To read otherwise would violate the fairness of the statute of limitations concept. In other words, the fraud charges against Gabelli were filed too late. The practical impact of this decision is that violations of federal laws subject to the statue of limitations here will begin to run when the fraud occurred, not when it was discovered.

26 February 2013

Law in Plain English: Clapper v. Amnesty International USA

This is one in a series of posts designed to describe court decisions in plain English. For more detail and background on the legal issues, see the link to the case below. For similar posts, click here.

Clapper v. Amnesty International USA

The Foreign Intelligence Surveillance Act (FISA) authorizes the Attorney General and the Director of National Intelligence to intercept certain foreign communications--generally non-US persons and persons believed to be located outside of the United States. Amnesty International USA and other human rights organizations alleged that they communicated with people who are likely to be targets of FISA, and as a result, their communications are likely to be surveilled. The question here was whether these groups had standing to challenge FISA because they had offered no evidence that their communications had been intercepted. The Supreme Court ruled (in a 5-4 decision) that these groups did show that their injury was “concrete, particularized, and actual or imminent." Allegations that such injuries might occur in the future is not enough. As a result, the Court did not rule on the constitutional merits of FISA. The practical impact of this decision is that future claims will have to identify some evidence that their communications were intercepted. Because most or all of this information is classified, it seems unlikely that anyone (aside for some unforeseeable circumstances) will be able to adequately challenge the constitutionality of FISA.

20 February 2013

Law in Plain English: Bailey v. United States

This is one in a series of posts designed to describe court decisions in plain English. For more detail and background on the legal issues, see the link to the case below. For similar posts, click here.

Bailey v. United States

Police were preparing to execute a warrant to search a basement apartment for a suspected gun. Detectives were in an unmarked car outside and witnessed two men (one later identified as Bailey) leave the apartment and drive away. The detectives followed the car for about a mile and then stopped it. The officers found a key on Bailey, and then handcuffed the men and drove them back to the apartment, where the key opened Bailey's door. The issue in this case was whether police officers may detain an individual incident to the execution of a search warrant when the individual has left the immediate vicinity of the premises before the warrant is executed. The Supreme Court ruled that the detention of Bailey was too far removed from the immediate premises of the apartment that was authorized in the search warrant. The practical impact of this decision that detaining someone incident to the execution of a search warrant needs to be in the immediate vicinity--once the person has left that area, the officers will probably need an independent basis to do so.

10 January 2013

SCOTUS in Plain English: Already, LLC vs. Nike, Inc.

This is one in a series of posts designed to describe Supreme Court decisions in plain English. For more detail and background on the legal issues, see the link to the case at SCOTUblog below. For similar posts, click here.

Already, LLC v. Nike, Inc.

Nike sued Already for selling a shoe that Nike claimed infringed on one of its trademarks. In return, Already claimed that Nike's trademark was not valid (this is called a counter-claim). However, Already's shoes stopped selling so well. Nike didn't want to waste money on the lawsuit, so Nike promised Already (in an agreement called a "Covenant Not to Sue") that it wouldn't sue. But Already still wanted to have Nike's trademark invalidated in its counter-claim. The Supreme Court ruled that when Nike promised Already not to sue, the dispute was no longer a "case" or "controversy" under Article III of the U.S. Constitution (in other words, it was "moot"--courts cannot decide hypothetical situations--there must be an actual controversy). As a result, the Court could not hear Already's counter-claim.