Justia U.S. 2nd Circuit Court of Appeals Opinion Summaries

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WWE, relying on the court's decision in Hageman v. City Investing Co., moved to dismiss these appeals on the ground that other consolidated cases remained pending in the district court. Because the McCullough and Haynes cases, the subjects of the pending motion, were consolidated with other cases in the district court for all purposes, and because the Supreme Court in Gelboim v. Bank of America Corp. explicitly declined to express an opinion on the appealability of a dismissal of one of multiple cases in such a consolidation, Gelboim does not oblige the court to reconsider the continuing validity of Hageman. Applying Hageman, the court sees nothing in plaintiffs' papers that overcomes the “strong presumption that the judgment is not appealable.” Accordingly, the motion to dismiss the appeals in 16-1231 and 16-1237 is granted, without prejudice to renewal of these appeals upon entry of a final judgment in the district court disposing of all the cases with which the McCullough and Haynes cases have been consolidated. View "McCullough v. World Wrestling Entm't" on Justia Law
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Plaintiffs, investors in Vivendi's stock during the relevant time period, filed a class action suit against Vivendi, alleging that Vivendi’s persistently optimistic representations during the relevant period constituted securities fraud under section 10(b) of the Securities Exchange Act of 1934 (Exchange Act), 15 U.S.C. 78j(b), as well as the Securities Exchange Commission’s (SEC) Rule 10b–5 (Rule 10b–5) promulgated thereunder, 17 C.F.R. 240.10b–5. The court affirmed as to Vivendi's claims on appeal, concluding that: (1) plaintiffs relied on specifically identified false or misleading statements at trial and thus, contrary to Vivendi’s argument on appeal, did not fail to present an actionable claim of securities fraud; (2) Vivendi’s claim that certain statements constituted non‐actionable statements of opinion is not preserved for appellate review; (3) Vivendi’s claims that certain statements constituted non‐actionable puffery and that others fall under the Private Securities Law Reform Act’s safe harbor provision for “forward‐looking statements,” see 15 U.S.C. 78u‐5(c), is without merit; (4) the evidence was sufficient to support the jury’s determination that the fifty‐six statements at issue here were materially false or misleading with respect to Vivendi’s liquidity risk; (5) the district court did not abuse its discretion in admitting the testimony of plaintiffs’ expert, Dr. Blaine Nye; and (6) the evidence was sufficient to support the jury’s finding as to loss causation. As to plaintiffs' cross-appeal, the court affirmed and concluded that the district court did not abuse its discretion in excluding certain foreign shareholders from the class at the class certification stage; and did not err in dismissing claims by American purchasers of ordinary shares under Morrison v. Nat’l Austl. Bank Ltd. View "In re Vivendi, S.A. Secs. Litig." on Justia Law
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This appeal stems from the same set of underlying facts as those in In re Vivendi S.A. Securities Litigation, Nos. 15‐180‐cv(L), 15‐208‐cv(XAP), in which the court today issued a separate opinion. GAMCO, so-called "value investors," filed a securities fraud action against Vivendi under section 10(b) of the Securities Exchange Act of 1934 (Exchange Act), 15 U.S.C. 78j(b), as well as the Securities Exchange Commission’s (SEC) Rule 10b–5 (Rule 10b–5) promulgated thereunder, 17 C.F.R. 240.10b–5. The district court subsequently entered judgment for Vivendi. The court concluded that the record supports the district court’s conclusion that, if GAMCO had known of the liquidity problems and their concealment, GAMCO would still have believed Vivendi’s PMV to be “materially higher” than the public market price. The court also concluded that it was also not clearly erroneous for the district court to conclude that knowledge of Vivendi’s liquidity problems would not have changed GAMCO’s belief that a catalyst was likely — i.e., its belief that the market price would rise towards the PMV, if not immediately, then over the course of the next several years. In this case, the record at the trial simply does not establish that it was clearly erroneous for the district court to find that GAMCO, had it known of the liquidity problems at Vivendi, would have made the choice to buy the same securities it purchased. Accordingly, the court affirmed the judgment. View "GAMCO v. Vivendi" on Justia Law
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Amex appealed from the district court's decision finding that it unreasonably restrained trade in violation of section 1 of the Sherman Act, 15 U.S.C. 1, by entering into agreements containing nondiscriminatory provisions (NDPs). The district court held that Amex was liable for violating section 1 and enjoined Amex from enforcing its NDPs. The court concluded that the district court erred here in focusing entirely on the interests of merchants while discounting the interests of cardholders. Plaintiffs bore the burden in this case to prove net harm to Amex consumers as a whole - that is, both cardholders and merchants - by showing that Amex’s nondiscriminatory provisions have reduced the quality or quantity of credit‐card purchases. The court concluded that, given the district court’s explicit finding that neither party provided reliable evidence of Amex’s costs or profit margins accounting for consumers on both sides of the platform, and given evidence showing that the quality and output of credit cards across the entire industry continues to increase, plaintiffs failed to carry their burden to prove a section 1 violation. Accordingly, the court reversed and remanded. View "United States v. American Express Co." on Justia Law

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Plaintiff subscribes to data feeds through which the Exchanges provide information about securities traded on the Exchanges to an exclusive securities information processor pursuant to a plan approved by the SEC. The Processor consolidates the data and makes it available to subscribers. Plaintiff filed three materially identical suits alleging that the Exchanges had breached their contracts with him by providing preferentially fast access to the so‐called “Preferred Customers,” who purchase data and receive it from an Exchange directly via its proprietary feed. The court concluded that the district court erred in holding that it lacked subject matter jurisdiction to consider plaintiff's breach of contract claims, but affirmed the dismissal of the complaints for failure to state a claim. In this case, plaintiff has not plausibly alleged that the Exchanges violated any contractual obligation by simultaneously sending data to both the Processor and the Preferred Customers that is received earlier by the Preferred Customers; to the extent that plaintiff alleges that such a contractual obligation arises from the incorporation of SEC regulations into the contracts, his claims are preempted because his interpretation conflicts with the SEC’s interpretation and stands as an obstacle to the accomplishment of congressional purposes; to the extent that plaintiff alleges that the Exchanges undertook self‐imposed contractual obligations, distinct from their regulatory obligations, to ensure that market data is not received by any customer before it is received by the Processor, that claim fails because it has no basis in the text of the contracts; and to the extent that plaintiff argues that the SEC has interpreted the Exchanges’ obligations under the Exchange Act or SEC regulations incorrectly, any such argument must first be administratively exhausted before the SEC before it can be considered by this Court. View "Lanier v. Bats Exchange, Inc." on Justia Law
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The FTC and the State filed suit seeking to hold LeadClick liable for its role in the use of deceptive websites to market weight loss products in violation of Section 5 of the Federal Trade Commission Act (FTC Act), 15 U.S.C. 45(a)(1), and the Connecticut Unfair Trade Practices Act (CUTPA), C.G.S.A. 42‐110b(a). The FTC also filed a claim against CoreLogic, LeadClick's parent company, as a relief defendant. The district court granted summary judgment in favor of the FTC and the State. The court affirmed the district courtʹs grant of summary judgment for the FTC and the State with respect to the claims against LeadClick where LeadClick is an information content provider with respect to the content at issue and where LeadClick is liable for its own content and not merely because it was the ʺpublisher or speakerʺ of deceptive content provided by its affiliates; reversed as to the claim against CoreLogic where CoreLogic's advances to LeadClick constituted "valuable consideration" entitling it to repayment from LeadClick; and remanded with instructions to the district court to enter judgment in favor of CoreLogic. View "FTC v. LeadClick Media, LLC" on Justia Law

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Plaintiff filed suit for damages against a government employee and the government under the Federal Tort Claims Act (FTCA), 28 U.S.C. 1346(b), 2671-80, and New York law. The claims arose out of a traffic accident involving the employee that seriously injured plaintiff. The district court dismissed all claims against the government for lack of subject matter jurisdiction under Fed. R. Civ. Pro. 12(b)(1), and declined to exercise supplemental jurisdiction over the remaining state‐law claims against the employee, after finding that the employee was not acting within the scope of his employment at the time of the accident. The court concluded that although such a finding would warrant dismissal in an action under the Act, dismissal was premature in this case in light of an unresolved factual dispute over whether the employee used the vehicle with implied permission. Accordingly, the court vacated and remanded for further proceedings. View "Fountain v. Karim" on Justia Law
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Defendant was convicted of extortion and use of a destructive device to commit extortion. Defendant's conviction arose out of his plot to extort money from Home Depot by placing a device purporting to be an inert “model” of a pipe bomb in a Home Depot store in Huntington Station, New York, and threatening to plant bombs in other Home Depot locations. The court concluded that the evidence was sufficient to establish that the device used by defendant was an “explosive bomb,” as contemplated by 18 U.S.C. 921(a)(4), and that the district court did not err in instructing the jury on the combination‐of‐parts theory of guilt; the prosecutor’s comments during summation did not deprive defendant of a fair trial; and therefore the court affirmed the judgment. View "United States v. Sheehan" on Justia Law
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Defendant plead guilty to conspiracy to traffic in narcotics and was sentenced to 188 months in prison and five years of supervised release. On appeal, defendant challenged the revocation of his supervised release and imposition of an additional prison term of 27 months based on a finding that he had engaged in new criminal conduct while on federal supervision, specifically, assault, as proscribed by New York Penal Law 120.00(1), and narcotics distribution, in violation of New York Penal Law 220.39. The court concluded that Title 18 U.S.C. 3583(e)’s use of the disjunctive in identifying the actions a district court may take with respect to defendants serving terms of supervised release does not limit a court’s authority so as to preclude it from revoking supervised release after conduct is proved that, when reported, had prompted modification of supervision conditions. Therefore, the district court had authorization to revoke defendant's supervised release in this case. The court also concluded that the district court acted within its discretion in admitting the victim's hearsay statements in determining that defendant, while on federal supervision, had committed a new state crime of assault. In this case, the district court properly balanced defendant's confrontation interest against the assault victim's reasons for refusing to testify. Accordingly, the court affirmed the judgment. View "United States v. Harris" on Justia Law
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Defendant appealed his conviction for one count of conspiracy to defraud the IRS, four counts of client tax evasion, one count of IRS obstruction, and one count of mail fraud. The court concluded that the evidence was sufficient to support the convictions; the indictment was not constructively amended; the indictment was not duplicitous; defendant's due process right to a fair trial was not violated; the district court did not commit prejudicial error in giving a supplemental instruction about the Annual Accounting Rule; defendant's sentence was procedurally and substantively reasonable; and the court rejected defendant's claims of error as to the forfeiture order. Accordingly, the court affirmed the judgment. View "United States v. Daugerdas" on Justia Law