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

Plaintiffs, a class of individuals who participated in the Morgan Stanley 401(k) Plan and the Morgan Stanley Employee Stock Ownership Plan, filed suit alleging violations of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq. In January 2007 and 2008, Morgan Stanley elected to make its employer contributions to the Plans in the form of Company Stock instead of cash. After the stock price plunged in conjunction with the broader economic downturn, plaintiffs sought to recover for losses the Plans suffered as a result of the drop in stock price. The Moench "presumption of prudence" is a pleading standard that presumes plan fiduciaries act in "compliance with ERISA when [a plan] fiduciary invests assets in the employer's stock." The district court found that the Moench presumption of prudence applied to defendants' conduct and that plaintiffs failed to rebut this presumption. The court affirmed the district court's motion to dismiss on the district court's alternative ground because the challenged conduct, even if it negatively impacted the Plans, did not occur in the performance of a fiduciary function and therefore could not trigger fiduciary liability under ERISA. Absent fiduciary liability, plaintiffs' secondary claims also failed. View "Coulter, et al. v. Morgan Stanley & Co. Inc., et al." on Justia Law

Defendants appealed from their convictions of conspiracy; aiding and abetting violations of the Clean Air Act, 42 U.S.C. 7401; mail fraud; and making false statements to federal officials. Defendants argued that the district court improperly excluded evidence that they acted under a good-faith belief that they were complying with state law and that, in any event, their convictions and sentences were irreparably tainted by prosecutorial misconduct. The Government cross-appealed. The court concluded that, under the circumstances, the court was compelled to conclude that the totality of the Government's misconduct in this case, combined with the district court's erroneous exclusion of evidence favorable to the defense denied defendants their right to a fair trial. Accordingly, the court vacated the judgments of conviction as to CES, Copeland, and Dunn. The court ordered a new trial. The court also concluded that the district court clearly erred in setting the amount of restitution. Finally, factual and procedural errors required the court to vacate the sentences of Allen and Onoff and remand for resentencing. The court need not, and did not, consider whether their sentences were substantively reasonable. View "United States v. Certified Environmental Services, Inc." on Justia Law

Appellants appealed from the district court's dismissal of their claims under the Establishment Clause and the Free Exercise Clause, as well as the Religions Freedom Restoration Act of 1993 (RFRA), 42 U.S.C. 2000bb. Appellants challenged two statutory provisions, 31 U.S.C. 5112(d)(1) and 5114(b), which require that the country's motto, "In God We Trust," be placed on all coinage and paper currency. Joining its sister circuits, the court held that sections 5112(d)(1) and 5114(b) do not violate the Establishment Clause, the Free Exercise Clause, or RFRA because the statutes at issue have a secular purpose and neither advance nor inhibit religion and appellants have failed to identify a substantial burden upon their religious practices or beliefs. The court considered appellants' remaining arguments and found them to be without merit. Accordingly, the court affirmed the judgment of the district court. View "Newdow v. United States" on Justia Law

Petitioner pled guilty to four counts of sexual assault in the fourth degree under Connecticut General Statute 53a-73a(a)(2), which criminalizes subjecting "another person to sexual contact without such other person's consent." The United States then commenced removal proceedings against petitioner under 8 U.S.C. 1227(a)(2)(A)(ii). Under federal immigration law, petitioner's removal turns on whether the crime he was convicted of is a crime involving moral turpitude. Because the court is unable to predict what level of mens rea the Connecticut courts would require, and because the issue involves the weighing of important policy considerations, the court certified questions to the Connecticut Supreme Court. View "Efstathiadis v. Holder" on Justia Law

Defendant appealed his convictions stemming from his participation in coordinated suicide bombings in the New York City subway system. Defendant eventually caused a high-speed collision with another car, attempting to trigger an explosion that would kill himself and others. On appeal, defendant sought a new trial solely on the basis that the district court erred in denying his motion to suppress postarrest statements. The court concluded that, even assuming that Miranda rights may properly be asserted by a suspect prior to his being in custody and prior to his being questioned, there was no clear and unambiguous invocation of the right to counsel by defendant before his arrest; defendant's signing of the Miranda waiver was knowing and voluntary; the court rejected defendant's contention that the government's interference with the attorney-client relationship prior to his indictment ripened into a violation of his Sixth Amendment right to counsel upon his indictment and that the government's refusal to honor his choice to deal with the government through counsel violated his right to substantive due process under the Fifth Amendment; and, therefore, the court affirmed the judgment of conviction. View "United States v. Medunjanin" on Justia Law

Petitioners filed a petition for limitation on liability after visitors of their powerboat were involved in a fistfight on a floating dock operated by Claimant. At issue was whether federal admiralty jurisdiction extended to tort claims arising from a physical altercation among recreational visitors on and around a permanent dock surrounded by navigable water. The court held that federal admiralty jurisdiction did not reach the claims at issue because this type of incident did not have a potentially disruptive effect on maritime commerce. Accordingly, the court affirmed the district court's dismissal of the action for lack of subject matter jurisdiction. View "Tandon v. Ulbrick" on Justia Law

The SEC filed a civil enforcement action against defendant, alleging that defendant failed to follow directives issued by the mutual funds and his employer to cease his market timing, and that he used different "financial advisor numbers" when mutual funds blocked trading from the ones he customarily used. The jury found that defendant engaged in no intentional misconduct but that he violated Section 17 of the Securities Act of 1933, 15 U.S.C. 77q, which has no scienter element, with respect to six out of sixty mutual funds. The court concluded that the evidence established without contradiction that the funds were inconsistent in their proscriptions on market timing and that the employer supported defendant's practices - and the jury could not find negligence in these circumstances without evidence as to an appropriate standard of care. Accordingly, the court reversed and remanded for the district court to dismiss the complaint against defendant. View "SEC v. O'Meally" on Justia Law

Defendants Mandell and Harrington appealed from their convictions of conspiracy to commit securities fraud, wire fraud, and mail fraud; securities fraud; wire fraud; and mail fraud. The principal issue on appeal was whether there was sufficient evidence to convict defendants of securities fraud. The court concluded that, in light of the evidence of domestic transactions, and viewing the evidence in the light most favorable to the government, a rational jury could have found the essential elements of defendants' convictions beyond a reasonable doubt. Therefore, there was sufficient evidence to convict defendants of securities fraud. The government conceded that the forfeiture order should have made defendants jointly and severally liable for forfeiture. Accordingly, the court vacated and remanded as to this issue. The court rejected defendants' remaining arguments and affirmed in all other respects. View "United States v. Mandell" on Justia Law

Defendant pled guilty to drug-related offenses. On appeal, defendant argued that his erratic and irrational behavior following the entry of his plea required the district court to hold a competency hearing before imposing sentence and that he was deprived of his Sixth Amendment right to counsel by the denial of his multiple post-plea requests for an attorney to help him withdraw his plea. The court held that the district court was not required to hold a competency hearing before defendant's plea; defendant's post-plea behavior was not so erratic that it should have given the district court reason to doubt his competency; the district court did not abuse its discretion by denying defendant's post-plea requests for an attorney in light of defendant's alternating positions with respect to representation and his attempt to delay the proceedings; and defendant's sentence was reasonable. The court rejected defendant's arguments in his pro se brief. Accordingly, the court affirmed the judgment of the district court. View "United States v. Kerr" on Justia Law

Plaintiff filed suit against the Town after a decade of dealing with the Town in plaintiff's efforts to apply for subdivision approval. The court reversed the district court's decision to dismiss plaintiff's federal takings claims, concluding that his claim became ripe because of the way the Town handled his application under Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City where the Town employed a decade of unfair and repetitive procedures, which made seeking a final decision futile. The Town also unfairly manipulated the litigation of the case in a way that might have prevented plaintiff from ever bringing his takings claim. The court vacated the district court's dismissal of plaintiff's non-takings claims based on ripeness grounds and declined to exercise supplemental jurisdiction over his state law claims. The court affirmed the district court's decision to dismiss plaintiff's 42 U.S.C. 1981 claim, to deny plaintiff leave to amend to add a 42 U.S.C. 1982 claim, and to dismiss plaintiff's procedural due process claim based on the consultants' fee law. View "Sherman v. Town of Chester" on Justia Law