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

Applicant appealed the district court's denial of her application to compel discovery from respondent under 28 U.S.C. 1782. Applicant sought discovery from respondent to plead and to prove a contemplated defamation suit against him in her home country of the Netherlands. The district court denied the application on the ground that the materials sought were not “for use” in the Dutch proceeding, as required by section 1782, because they were not necessary for applicant to draft an adequate complaint. The court concluded that the district court's conclusion was erroneous because an applicant may satisfy the statute’s “for use” requirement even if the discovery she seeks is not necessary for her to succeed in the foreign proceeding and because the discovery need not be sought for the purpose of commencing a foreign proceeding in order to be “for use” in that proceeding. That is so even where a section 1782 applicant is a private litigant who has yet to commence the foreign proceeding for which discovery is sought, so long as the proceeding is within reasonable contemplation. A section 1782 applicant, such as the case here, satisfies the statute’s “for use” requirement by showing that the materials she seeks are to be used at some stage of a foreign proceeding. Accordingly, the court vacated and remanded. View "Mees v. Buiter" on Justia Law

Plaintiff, a New York corporation, filed suit attempting to collect money owed to it under defaulted Sub Notes issued by a now-dissolved entity, Hellas. On appeal, plaintiff argued that the district court erred in granting defendantsʹ motion to dismiss its complaint for lack of subject matter jurisdiction pursuant to Fed. R. Civ. P. 12(b)(1). Plaintiff also argued that the district court erred in failing to grant to it the opportunity to cure any standing defect under Fed. R. Civ. P. 17(a)(3). The court affirmed the judgment, concluding that plaintiff has not carried its burden of showing a valid assignment of a claim. Nor has plaintiff pointed to anything in the assignment, or to other evidence in the record, suggesting that title to claims arising under the Sub Notes was assigned to it. Although the court determined that plaintiff did not forfeit its rights under Rule 17, the court concluded that the district courtʹs decision to deny relief under that rule was not an abuse of discretion because neither of the requests made by plaintiff in its effort to cure the standing problem would have been consistent with Rule 17(a)(3). Accordingly, the court affirmed the judgment. View "Cortlandt St. Recovery Corp. v. Hellas Telecommunications" on Justia Law

This derivative action arose out of the London Whale trading debacle. Plaintiff, a JPMorgan shareholder, filed suit seeking to compel JPMorgan to take action, up to and including suing the alleged wrongdoers. The district court dismissed the complaint, finding that plaintiff had not pleaded facts showing that the JPMorgan Board of Directors had wrongfully refused the demand for action. The court noted that the abuse‐of‐discretion standard of review for the dismissal of derivative action cases should be retired, and that dismissals of derivative actions should be reviewed under the same de novo standard that the court followed in all other similarly situated cases. However, because the court is bound by the rule of the Circuit, the court concluded that the district court did not abuse its discretion by dismissing this derivative action. Accordingly, the court affirmed the judgment. Finally, the district court did not err by denying plaintiff an opportunity to amend his complaint. View "Espinoza v. Dimon" on Justia Law

Plaintiff, a Polish man of Jewish descent, filed suit against his employer, Mangia, and other individuals, alleging discrimination on the basis of religion and national origin, retaliation, conspiracy, wrongful termination, and violation of various New York State and City laws. A jury found Mangia liable and awarded nominal damages of $1 and punitive damages in the amount of $900,000. After the verdict, plaintiff applied for an award of attorneys' fees and costs and Mangia moved for remittitur of the punitive damages award. The district court vacated the jury's liability verdict, conditionally granted Mangia's motion for a new trial on the issue of punitive damages, and denied plaintiff's application for fees and costs. The court reversed the district court's ruling insofar as it vacates the liability verdict and award of nominal damages in the amount of $1 where, inter alia, the district court's rejection of the jury's conclusion that plaintiff was subject to a hostile work environment was essentially grounded in the type of evidence weighing and credibility determinations that are not permitted by Rule 50(b). The court affirmed the district court's ruling to the extent it vacated the award of punitive damages where no reasonable jury could conclude that Mangia's conduct was driven by an evil motive or intent, or that it involved a reckless or callous indifference to plaintiff's federally protected rights. The court remanded to the district court to determine what fees and costs, if any, plaintiff may recover given the highly unusual facts of this case. View "Wiercinski v. Mangia 57, Inc." on Justia Law

Plaintiff filed a putative class action against defendants and defendants subsequently offered to settle plaintiff's individual claims pursuant to Federal Rule of Civil Procedure 68 for an amount greater than the statutory damages to which plaintiff would have been entitled if successful. Plaintiff refused to accept and defendants filed a motion to dismiss. The district court denied the motion, holding that although plaintiff’s individual claims were rendered moot by the unaccepted Rule 68 offer, his putative class action claims were not. The court held that the district court maintained Article III subject matter jurisdiction over the case because, under the law of the Circuit, an unaccepted Rule 68 offer alone does not render a plaintiff’s individual claims moot before the entry of judgment against the defendants. Therefore, the district court maintained Article III subject matter jurisdiction over the case regardless of plaintiff’s putative class action claims. Accordingly, because it is unnecessary to the disposition of this case, the court did not reach the certified question of whether putative class action claims brought under Rule 23 of the Federal Rules generally provide an independent basis for Article III justiciability. The court affirmed the district court’s decision that it maintained subject matter jurisdiction over the case, albeit on the alternative ground that plaintiff's individual claims were not moot at the time the district court denied the defendants’ motion to dismiss. View "Tanasi v. New Alliance Bank" on Justia Law

Defendant and his counsel, D&B, (collectively, "petitioners") appealed the district court's grant of the government's motion to dismiss their petition asserting an interest found in property found subject to forfeiture under 18 U.S.C. 982(a)(2) after defendant's co-defendant was convicted. The district court determined that both parties had standing but that petitioners failed to state any claims for relief. The court concluded that because the government’s forfeiture claim qualifies it as a creditor under New York law, the government has standing to challenge D&B's assignment as a fraudulent conveyance; because the record fails to establish whether the transferor of the contested funds was insolvent at the time of the transfer so as to render D&B’s assignment a fraudulent conveyance, the petitioners have, at this stage in the proceedings, alleged a plausible interest in the property sufficient to create standing to seek an ancillary hearing; because the contested funds are subject to forfeiture as “proceeds” of the co-defendant's criminal activity and therefore only came into existence following the commission of his criminal act, petitioners cannot claim that D&B had a superior interest in those funds at the time of the offense as required by 21 U.S.C. § 853(n)(6)(A); and because the criminal forfeiture statute limits a third party’s right to challenge a post‐indictment forfeiture order to the two grounds identified in 21 U.S.C. § 853(n)(6), petitioners may not challenge the inclusion of the contested funds in the forfeiture order under § 982(a)(2). The court concluded, however, that because D&B accepted the assignment of the contested funds shortly after a Monsanto hearing in which the district court determined that the government failed to establish probable cause to restrain the contested property, and because the petition alleges no additional facts suggesting that D&B had reason to know that the property was forfeitable as a matter of law, petitioners have plausibly alleged that D&B was a bona fide purchaser reasonably without cause to believe that the property was subject to forfeiture. Accordingly, the court affirmed in part and reversed in part. View "United States v. Watts" on Justia Law

Benihana America obtained a preliminary injunction in aid of arbitration of a dispute arising under its license agreement with Benihana of Tokyo, prohibiting Tokyo from: selling unauthorized food items at the restaurant it operates under the license agreement; using certain trademarks in connection with that restaurant in a manner not approved by the license agreement; and arguing to the arbitral panel, if it rules that Tokyo breached the license agreement, that Tokyo should be given additional time to cure any defaults. The Second Circuit affirmed with respect to the menu offering and trademark use injunctions. The court reasonably concluded that each of the relevant factors favored Benihana America. The court reversed the prohibition on arguing to the arbitral panel for an extended cure period. When a dispute is properly before an arbitrator, a court should not interfere with the arbitral process on the ground that, in its view of the merits, a particular remedy would not be warranted. Benihana America may challenge an arbitrator’s decision in court only after it has been issued. It may not subvert its agreement to arbitrate by obtaining an advance judicial determination that there are no grounds for the arbitrator to grant a particular remedy. View "Benihana, Inc. v. Benihana of Tokyo, LLC" on Justia Law

Nova is the trustee and fiduciary of the Charter Oak Benefit Plan. A participating employer took out insurance policies on its employee’s (Spencer) life, totaling $30 million, and placed them into the Plan. Spencer named Universitas as the sole, irrevocable beneficiary. After Spencer’s death, the insurer paid $30 million to the Plan. Nova denied Universitas’s claim for the proceeds. In binding arbitration, an arbitrator held Nova liable for $26,558,308. Nova declined to pay, filing suit to vacate the arbitration award. The court confirmed the award. Nova moved for reconsideration and for a stay of post‐judgment discovery, then moved to dismiss for lack of subject matter jurisdiction. All were rejected. The district court granted Nova’s application to reinstate the motion to dismiss, but warned of potential penalties. Nova’s then‐counsel withdrew the motion; new counsel filed an amended motion, arguing complete diversity was lacking because Charter Oak was a citizen of New York, as was Universitas. Charter Oak was not a party; Nova argued that it was “a real and substantial party to the controversy.” The district court dismissed the motion. Nova refused to pay or to cooperate in discovery of its assets. The Second Circuit affirmed, awarding costs. The district court then sanctioned Nova by requiring it to deposit $30,181,880, the amount of the outstanding judgment, with the court. The Second Circuit vacated, holding that the court may not collect damages owed to a party by imposition of a sanction. View "Universitas Educ. LLC v. Nova Group Inc." on Justia Law

A 1999 suit alleged that plaintiffs had been arrested on misdemeanor charges and were strip searched, without individualized suspicion, in violation of their federal and state constitutional rights. Nassau County conceded liability. The Second Circuit instructed the court to certify a class as to liability and to consider whether to certify a class as to damages. The district court certified both classes, granted summary judgment on liability, and held a bench trial on damages. In 2012, before the district court entered judgment, Nassau County moved to vacate the summary judgment and to dismiss the action based on the Supreme Court’s 2012 decision Florence v. Bd. of Chosen Freeholders, that “every detainee who will be admitted to the general population [of a jail] may be required to undergo a close visual inspection while undressed. The court granted the motion as to the federal claim, but determined that Florence did not warrant vacatur of the concession of liability with respect to the state claim, and awarded $11.5 million. While appeal was pending, Nassau County moved to stay enforcement pending appeal. The district court ruled that the obligation to deposit the funds with the court would be stayed for 180 days, or indefinitely, if Nassau County posted a bond. The Second Circuit stayed the requirement of deposit or bond. View "In re: Nassau Cnty Strip Search Cases" on Justia Law

Taylor sued Nassau County, its police department, and officers and supervisors, alleging that officer Rogich used excessive force when he shot Taylor while apprehending him. After dismissals and partial summary judgment, the only defendant was Rogich. The district judge held that Rogich was not entitled to summary judgment on his claim of qualified immunity, because the claim depended on the resolution of disputed issues of fact and the jury’s assessment of the credibility of witnesses. At the close of the liability phase of the trial, the jury found that Rogich used excessive force that caused Taylor injury. Rogich moved for judgment as a matter of law, arguing that the plaintiff had provided no coherent version of events which a jury could have credited one way or the other. Rogich’s motion was denied because his assertion of qualified immunity depended on a view of the facts that was explicitly rejected by the jury” The Second Circuit dismissed an appeal for lack of jurisdiction to decide an interlocutory appeal from a denial of a claim of qualified immunity to the extent that the denial involves only a question of evidence sufficiency. View "Taylor v. Rogich" on Justia Law