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

This case stemmed from a civil enforcement action brought by the SEC against Symbol Technologies. Defendant, Symbol's president and COO, subsequently appealed the district court's order directing him to disgorge to the SEC over $41 million, plus prejudgment interest, and to pay a civil penalty, for violations of various securities laws. For a number of years, defendant and others engaged in a wide array of fraudulent accounting practices and other misconduct. The court found no error or abuse of discretion in the entry of the default judgment, the denial of defendant's recusal motion, and the disgorgement award. The court, however, remanded for recalculation of prejudgment interest and for the clerical correction of a discrepancy between the amount of the civil penalty ordered in the district court's ruling and the amount of the penalty awarded in the judgment. View "SEC v. Razmilovic" on Justia Law

The IRS challenged the district court's judgment upholding the bankruptcy court's decision to grant the objection of the reorganized Worldcom debtors to the IRS's proof of claim for taxes owed and the debtors' refund motion for the taxes WorldCom had already paid. At issue was whether WorldCom must pay federal excise taxes on the purchase of a telecommunications service that connected people using dial-up modems to the Internet. The court held that WorldCom purchased a "local telephone service" when it paid for the telecommunications service and that WorldCom must therefore pay federal communication excise taxes on those transactions. Accordingly, the court reversed and remanded for further proceedings. View "In Re: WorldCom, Inc." on Justia Law

Plaintiffs filed a putative class action seeking to hold ProShares liable for material omissions and misrepresentations in the prospectuses for certain exchange-traded funds (ETFs) under the Securities Act of 1933, 15 U.S.C. 77k and 77o. Plaintiffs alleged that registration of statements omitted the risk that the ETFs, when held for a period of greater than one day, could lose substantial value in a relatively brief period of time, particularly in periods of high volatility. The district court concluded that the disclosures at issue accurately conveyed the specific risk that plaintiffs asserted materialized. The court agreed with the district court's conclusion that the relevant prospectuses adequately warned the reasonable investor of the allegedly omitted risks. View "In Re: ProShares Trust Sec. Litig." on Justia Law

Plaintiff filed suit against defendants, asserting claims under 42 U.S.C. 1983 and for negligence, after plaintiff's son was shot and killed by a state trooper. In regards to the negligence claim, the court found nothing in the record that contravened the district court's conclusion that there was no evidence either that the planning of the search contributed to the son's death, or that the trooper shot the son unintentionally; in regards to the timing of the search, the court agreed with the district court that the matter of premature entry was immaterial to the question of excessive force; and in regards to the sufficiency of the evidence, a district court's denial of a motion for new trial on weight-of-the-evidence grounds was not reviewable on appeal. The court concluded, however, that in the circumstances of this case - the close-range shooting of a suspect by a law enforcement officer - the district court was required to instruct the jury that it must find that this use of force was excessive unless the jury found that the officer had probable cause to believe that the suspect posed a significant threat of death or serious physical injury to the officer or others. Because the district court did not give this instruction, it plainly erred under the current law. Accordingly, the court reversed and remanded for a new trial. View "Rasanen v. Brown" on Justia Law

Plaintiffs challenged Section 1021(b)(2) of the National Defense Authorization Act for Fiscal Year 2012 (2012 NDAA), Pub. L. 112-81, 125 Stat. 1298, which appears to permit the President to detain anyone who was part of, or has substantially supported, al-Qaeda, the Taliban, or associated forces. Plaintiffs, journalists and activists, sought an injunction barring enforcement of Section 1021 and a declaration that it violated, among other things, their rights under the First and Fifth Amendments. The court concluded that the American citizen plaintiffs lacked standing because Section 1021 says nothing at all about the President's authority to detain American citizens; while section 1021 had no real bearing on those who were neither citizens nor lawful residents and who were apprehended abroad, the non-citizen plaintiffs also failed to establish standing because they had not shown a sufficient threat that the government would detain them under Section 1021; and, therefore, the court vacated the permanent injunction, having no need to address the merits of plaintiffs' claims. View "Hedges v. Obama" on Justia Law

This case stemmed from a maritime contract entered into by Blue Whale and Development. Blue Whale filed a complaint in district seeking to attach property belonging to Development's alleged alter ego, HNA, in anticipation of a future arbitration award against Development pursuant to Rule B of the Supplemental Rules for Certain Admiralty and Maritime Claims. The court concluded that the district court properly applied federal maritime law to the procedural question of whether Blue Whale's claim sounded in admiralty, and the claim did sound in admiralty because it arose out of a maritime contract; the issue of the claim's prima facie validity was a substantive inquiry; however, the district court's application of English law to this question was improper because the charter's party's choice-of-law provision did not govern Blue Whale's collateral alter-ego claim against HNA; and drawing on maritime choice-of-law principles, the court held that although federal common law did not govern every claim of this nature, federal common law did apply here, primarily because of the collateral claim's close ties to the United States. Accordingly, the court remanded for reconsideration of the prima facie validity of Blue Whale's alter-ego claim under federal common law. View "Blue Whale Corp. v. Grand China Shipping Dev. Co., Ltd., et al." on Justia Law

Defendant appealed his sentence stemming from his conviction of conspiracy to distribute and possess with the intent to distribute more than 100 kilograms of marijuana. Although the district court expressed the terms of the waiver imperfectly, the objection was unpreserved. Under the circumstances, the court concluded that defendant made a knowing and voluntary appeal waiver and, under this standard, failed to establish plain error. Accordingly, the court affirmed the judgment and did not reach the merits of his argument. View "United States v. Nourse" on Justia Law

Plaintiffs, office cleaners in buildings surrounding the World Trade Center disaster site on and after the September 11th terrorist attacks, appealed the district court's order denying their motion for an extension of time to comply with the district court's prior order requiring them to submit properly certified discovery responses, and dismissing their complaint with prejudice for failure to prosecute their cases. Plaintiffs alleged injuries resulting from exposure to toxic materials from the World Trade Center site. The court concluded that the district court acted well within its discretion in dismissing certain plaintiffs' complaints for failure to comply with repeated court orders despite numerous extension of time to do so. The court also concluded that the district court did not err as a matter of law in interpreting 28 U.S.C. 1746 to require that a certification be made "under penalty of perjury." Therefore, the district court properly rejected the interrogatory answers of certain plaintiffs that omitted that language. Accordingly, the court affirmed the judgment. View "In re: World Trade Center Disaster Site Litigation" on Justia Law

The Town and the State appealed from the district court's adverse summary judgment ruling in a suit where the Tribe challenged the Town's imposition of the State's personal property tax on the lessors of slot machines used by the Tribe at Foxwoods Casino. The court held that the district court properly exercised jurisdiction; the Tribe had standing; neither the Indian Gaming Regulatory Act (IGRA), 25 U.S.C. 2701 et seq., nor the Indian Trader Statutes, 25 U.S.C. 261-64, expressly barred the tax; and, under the White Mountain Apache Tribe v. Bracker test, federal law did not implicitly bar the tax because the State and Town interests in the integrity and uniform application of their tax system outweighed the federal and tribal interests reflected in IGRA. Accordingly, the court concluded that the district court erred in granting summary judgment for the Tribe and in denying summary judgment for the Town and State. View "Mashantucket Pequot Tribe v. Town of Ledyard" on Justia Law

Plaintiffs, former Lehman employees, filed suit alleging that defendants, members of the Benefits Committee, and the company's Directors, breached their duties under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq. In regards to plaintiffs' claims that the Benefits Committee Defendants breached their duty of prudence in managing the company's employee stock ownership plan (ESOP), the court concluded that plaintiffs have not rebutted the Moench v. Robertson presumption because they failed to allege facts sufficient to show that the Benefits Committee Defendants knew or should have known that Lehman was in a "dire situation" based on information that was publicly available during the class period. In regards to plaintiffs' claims that the Benefits Committee Defendants breached their duty of disclosure, the publicly-known information available to defendants did not give rise to an independent duty to investigate Lehman's SEC filings prior to incorporating their content into a summary plan description issued to plan-participants. The court affirmed the district court's dismissal of plaintiffs' remaining claims. View "In Re: Lehman Bros. ERISA Litig." on Justia Law