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

A group of individuals planned and executed a robbery of a stash house in Queens, New York, in September 2017. Matthew Elias, one of the defendants, drove a getaway car but was arrested shortly after the robbery, before he received any share of the stolen property, which included marijuana, a gun, and approximately $20,000 in cash. Testimony at trial established that another participant, Hytmiah, kept all the proceeds from the robbery, distributing only a small portion to one other individual and refusing to share with the rest, including Elias.The United States District Court for the Eastern District of New York (Judge Garaufis) presided over the trial, where a jury convicted Elias of Hobbs Act robbery. As part of his sentence, the district court ordered Elias to forfeit $10,000, calculated as a pro rata share of the robbery’s proceeds, under 18 U.S.C. § 981(a)(1)(C). Elias appealed, arguing that the forfeiture order was improper because he never actually acquired any of the proceeds.The United States Court of Appeals for the Second Circuit reviewed the case. The court held that, under 18 U.S.C. § 981(a)(1)(C), as informed by the Supreme Court’s decision in Honeycutt v. United States, criminal forfeiture is limited to property that the defendant personally acquired as a result of the offense. The Second Circuit concluded that Elias was ordered to forfeit property he never obtained, which violated this rule. Accordingly, the court vacated the forfeiture order against Elias. The remainder of the judgments against Elias and his co-defendant were affirmed in part and vacated in part, with instructions for further proceedings consistent with the court’s opinion. View "United States v. Elias" on Justia Law

A licensed veterinarian developed and manufactured undetectable performance enhancing drugs (PEDs) for use in professional horse racing, selling them to trainers who administered them to horses to gain a competitive edge. His salesperson assisted in these activities, operating a company that distributed the drugs without prescriptions or FDA approval. The drugs were misbranded or adulterated, and the operation involved deceptive practices such as misleading labeling and falsified customs forms. The PEDs were credited by trainers for their horses’ successes, and evidence showed the drugs could be harmful if misused.The United States District Court for the Southern District of New York presided over two separate trials, resulting in convictions for both the veterinarian and his salesperson for conspiracy to manufacture and distribute misbranded or adulterated drugs with intent to defraud or mislead, in violation of the Food, Drug, and Cosmetic Act. The district court denied motions to dismiss the indictment, admitted evidence from a prior state investigation, and imposed sentences including imprisonment, restitution, and forfeiture. The court calculated loss for sentencing based on the veterinarian’s gains and ordered restitution to racetracks based on winnings by a coconspirator’s doped horses.On appeal, the United States Court of Appeals for the Second Circuit held that the statute’s “intent to defraud or mislead” element is not limited to particular categories of victims; it is sufficient if the intent relates to the underlying violation. The court found no error in the admission of evidence from the 2011 investigation or in the use of gain as a proxy for loss in sentencing. However, it vacated the restitution order to racetracks, finding no evidence they suffered pecuniary loss, and vacated the forfeiture order, holding that the relevant statute is not a civil forfeiture statute subject to criminal forfeiture procedures. The convictions and sentence were otherwise affirmed. View "United States v. Fishman" on Justia Law

The case concerns a defendant who was convicted by a jury in the United States District Court for the Northern District of New York of transporting, receiving, and possessing child pornography, all in violation of federal law. The defendant’s conduct involved the use of the Kik messaging application, which uses software to detect and report child sexual abuse material (CSAM) to the National Center for Missing and Exploited Children (NCMEC). Kik’s detection process relies on a database of known CSAM hash values provided by NCMEC. When Kik’s software identifies a match, a designated employee reviews the file and, if confirmed as CSAM, reports it to NCMEC, which then forwards the information to law enforcement. The defendant was linked to the offending accounts through IP address records and admitted during a post-arrest interview to using the relevant Kik accounts and sharing child pornography.After his arrest, the defendant moved to suppress evidence obtained from Kik’s searches and his own statements to law enforcement, arguing that Kik acted as an agent of NCMEC, which he claimed was a governmental entity for Fourth Amendment purposes. The United States District Court for the Northern District of New York denied the motion, finding that while NCMEC might be a governmental entity, Kik was not acting as its agent. The court also found that the defendant had validly waived his Miranda rights and that his statements were not coerced. The jury acquitted the defendant on some counts but convicted him on others. The court sentenced him to 151 months in prison and 15 years of supervised release.On appeal, the United States Court of Appeals for the Second Circuit held that NCMEC is a governmental entity for Fourth Amendment purposes, but the defendant failed to show that Kik acted as a governmental agent when it searched his accounts. The court affirmed the denial of the suppression motion, found the evidence sufficient to support the convictions, and upheld the sentence as substantively reasonable. However, the court vacated and remanded in part, instructing the district court to amend the written judgment to conform with its oral pronouncement regarding certain conditions of supervised release. View "United States v. Guard" on Justia Law

A U.K. citizen and former hedge fund manager predicted that the South African rand would strengthen against the U.S. dollar following a South African election. Acting on this belief, he purchased a one-touch barrier option for his hedge fund, which would pay $20 million if the rand-to-dollar exchange rate dropped below 12.50 before the option’s expiration. As the expiration approached and the rate hovered just above the threshold, he instructed a banker in Singapore to sell large amounts of dollars for rand to push the exchange rate below 12.50, thereby triggering the option and securing the payout for his fund. The trades were executed while he was in South Africa, and the payout obligations ultimately fell on U.S.-based financial institutions.A grand jury in the United States District Court for the Southern District of New York indicted him for commodities fraud and conspiracy to commit commodities fraud under the Commodity Exchange Act (CEA). At trial, the government presented evidence of his intent to manipulate the market to trigger the option. The jury convicted him of commodities fraud but acquitted him of conspiracy. The district court denied his post-trial motions for acquittal or a new trial, finding sufficient evidence of a direct and significant connection to U.S. commerce, adequate jury instructions, and no due process violation.On appeal, the United States Court of Appeals for the Second Circuit affirmed the conviction. The court held that the CEA’s extraterritoriality provision applied because the conduct had a direct and significant connection to U.S. commerce, given that U.S. financial institutions bore the payout risk. The court also found the jury instructions on intent and materiality were proper, that proof of an artificial price was not required under the charged anti-fraud provision, and that the defendant had fair notice his conduct was unlawful. The district court’s judgment was affirmed. View "United States v. Phillips" on Justia Law

Mathew James, a former nurse and owner of a medical billing business, was convicted after a jury trial for health care fraud, conspiracy to commit health care fraud, wire fraud, and aggravated identity theft. The charges arose from a scheme in which James and his employees falsified insurance claims by “upcoding” and “unbundling” medical procedures, directed patients to emergency rooms for pre-planned surgeries, and impersonated patients in communications with insurance companies. The fraudulent activity spanned several years, involved nearly 150 physicians, and resulted in tens of thousands of claims. While some of James’s business was legitimate, the government’s evidence focused on the fraudulent aspects of his operations.The United States District Court for the Eastern District of New York (Judge Seybert) presided over the trial and sentencing. The jury convicted James on most counts but acquitted him of money laundering conspiracy. During trial, jurors were inadvertently given access to transcripts of two recorded calls not admitted into evidence, but the district court declined to conduct an inquiry into the exposure, instead instructing the jury to disregard any material not in evidence. At sentencing, the court imposed a 144-month prison term, a forfeiture order of over $63 million, and restitution of nearly $337 million. The court applied sentencing enhancements for James’s leadership role and abuse of trust, and increased the sentence after considering James’s potential eligibility for earned time credits and rehabilitation programs.The United States Court of Appeals for the Second Circuit affirmed James’s conviction, finding any jury exposure to extra-record material harmless. However, the court vacated the sentence, including the forfeiture and restitution orders, holding that the district court erred by enhancing the sentence based on potential earned time credits and rehabilitation program eligibility, misapplied sentencing enhancements without adequate findings, and failed to properly calculate forfeiture and restitution by including legitimate business revenue. The case was remanded for resentencing. View "United States v. James" on Justia Law

The defendant pled guilty to possession of a firearm and ammunition after a felony conviction. At sentencing, the United States District Court for the Eastern District of New York imposed a term of imprisonment followed by supervised release. During the sentencing hearing, the court orally imposed several “special” conditions of supervised release, as recommended in the presentence report, but did not specify or discuss any “standard” or additional discretionary conditions. The court also stated that the defendant would not be required to contribute to the cost of mental health services, contrary to a recommendation in the presentence report. However, the written judgment later included not only the special conditions but also thirteen additional discretionary “standard” conditions of supervised release, as well as a requirement that the defendant contribute to mental health service costs.After sentencing, the defendant appealed, arguing that his constitutional right to be present at sentencing was violated because the thirteen discretionary conditions were not pronounced in his presence, and that the written judgment’s requirement to pay for mental health services contradicted the oral sentence. Both parties agreed that the payment requirement should be eliminated due to this inconsistency.The United States Court of Appeals for the Second Circuit, sitting en banc, reviewed the case de novo. The court overruled its prior precedent in United States v. Truscello, which had allowed non-mandatory “standard” conditions to be added to the written judgment without oral pronouncement. The Second Circuit held that all non-mandatory conditions of supervised release, including those labeled as “standard” in the Sentencing Guidelines, must be pronounced in the defendant’s presence at sentencing. The court vacated the portions of the sentence imposing the thirteen discretionary conditions and the payment requirement, and remanded the case for further proceedings consistent with its opinion. View "United States v. Maiorana" on Justia Law

A New York State Police trooper stopped Daniel Delgado for erratic driving and discovered that his license was suspended. During an inventory search of his vehicle, the trooper found a loaded “ghost gun” and ammunition, which Delgado admitted belonged to him. Delgado had several prior convictions, including a felony conviction for attempted second-degree murder in Florida, where he had shot a man in the back. Delgado was indicted for possessing ammunition after a felony conviction, in violation of 18 U.S.C. § 922(g)(1), and pleaded guilty without a plea agreement.The United States District Court for the Southern District of New York denied Delgado’s motion to withdraw his guilty plea and to dismiss the indictment, finding that § 922(g)(1) did not violate the Second Amendment. At sentencing, the court determined that Delgado’s prior Florida conviction for attempted second-degree murder was a “crime of violence” under U.S.S.G. § 2K2.1(a), resulting in a higher base offense level. Delgado was sentenced to thirty months’ imprisonment and three years of supervised release. He timely appealed, challenging both the constitutionality of § 922(g)(1) and the classification of his prior conviction.The United States Court of Appeals for the Second Circuit reviewed the case. It held that Delgado’s constitutional challenge to § 922(g)(1) was foreclosed by its recent decision in Zherka v. Bondi, which reaffirmed the statute’s constitutionality after New York State Rifle & Pistol Ass’n v. Bruen. The court also held that Florida’s offense of attempted second-degree murder is categorically a crime of violence under the Sentencing Guidelines, as it requires an intentional act imminently dangerous to another and demonstrating a depraved mind. The Second Circuit affirmed the judgment of the district court. View "United States v. Delgado" on Justia Law

Carlos Mercado was originally convicted in federal court of conspiracy to distribute heroin and sentenced to 120 months’ imprisonment followed by five years of supervised release, with conditions including a prohibition on committing new offenses. After completing his prison term, Mercado began supervised release in June 2021. In November 2024, he was arrested by Hartford police and charged under Connecticut law with drug offenses after narcotics and cash were found in his possession. The United States Probation Office petitioned the United States District Court for the District of Connecticut to issue a summons for a hearing on Mercado’s alleged violation of supervised release.The District Court for the District of Connecticut questioned whether it had statutory authority to detain Mercado pending revocation proceedings, citing the Non-Detention Act, which requires statutory authorization for detention of U.S. citizens. The court concluded that neither 18 U.S.C. § 3143(a)(1) nor Federal Rule of Criminal Procedure 32.1 provided such authority, reasoning that Mercado had not been “found guilty of an offense” with respect to the alleged violation and was not “awaiting imposition or execution” of a sentence. The court denied the government’s motion to detain Mercado, and Mercado moved to dismiss the government’s appeal for lack of jurisdiction.The United States Court of Appeals for the Second Circuit held that it had jurisdiction to review the district court’s order under 18 U.S.C. § 3145(c) and 28 U.S.C. § 1291. The Second Circuit further held that 18 U.S.C. § 3143(a)(1) authorizes a district court to detain a supervisee charged with a supervised release violation pending revocation proceedings, because the supervisee was previously found guilty and is awaiting execution of a portion of the original sentence. The appellate court vacated the district court’s order and remanded for further proceedings. View "United States v. Mercado" on Justia Law

A group of plaintiffs, including an individual, a retirement fund, and several investment funds, traded derivatives based on the Euro Interbank Offered Rate (Euribor). They alleged that a group of banks and brokers conspired to manipulate Euribor, which affected the pricing of various over-the-counter (OTC) derivatives, such as FX forwards, interest-rate swaps, and forward rate agreements. The alleged conduct included coordinated false submissions to set Euribor at artificial levels, collusion among banks and brokers, and structural changes within banks to facilitate manipulation. Plaintiffs claimed this manipulation harmed them by distorting the prices of their Euribor-based derivative transactions.The United States District Court for the Southern District of New York dismissed the plaintiffs’ claims under the Sherman Act, the Commodity Exchange Act (CEA), the Racketeer Influenced and Corrupt Organizations Act (RICO), and state common law, finding it lacked personal jurisdiction over all defendants. The district court also found that the RICO claims were based on extraterritorial conduct and did not meet the particularity requirements of Federal Rule of Civil Procedure 9(b). It declined to exercise pendent personal jurisdiction over state-law claims.The United States Court of Appeals for the Second Circuit reviewed the case. It agreed that conspiracy-based personal jurisdiction was not established but held that two plaintiffs—Frontpoint Australian Opportunities Trust and the California State Teachers’ Retirement System—had established specific personal jurisdiction over UBS AG and The Royal Bank of Scotland PLC for Sherman Act and RICO claims related to OTC Euribor derivative transactions in the United States. The court affirmed dismissal of the RICO claims for lack of particularity, but held that the Sherman Act claims were sufficiently pleaded. It vacated the district court’s refusal to exercise pendent personal jurisdiction over state-law claims and remanded for further proceedings. The judgment was affirmed in part, reversed in part, and vacated in part. View "Sullivan v. UBS AG" on Justia Law

The defendant pleaded guilty to three counts of possessing child pornography, following an investigation that began when coworkers reported him for viewing such material at work. A forensic analysis confirmed the allegations, and further investigation revealed that he possessed between 10 and 150 images of child pornography, as well as other images indicating a sexual interest in children. During the investigation, authorities also learned that in 2014, the defendant, then a church treasurer and deacon, had sexually abused two young boys at his church on the same day, in separate rooms and separated by non-criminal conduct.The United States District Court for the Northern District of New York accepted the defendant’s guilty plea and, at sentencing, applied a five-level enhancement under U.S.S.G. § 2G2.2(b)(5) for engaging in a pattern of activity involving the sexual abuse or exploitation of a minor. The court found by a preponderance of the evidence that the defendant’s abuse of the two boys constituted two separate instances of sexual abuse. The court sentenced the defendant to 97 months’ imprisonment and imposed a 20-year term of supervised release, including special conditions restricting contact with minors, limiting him to one internet-capable device, and prohibiting possession of sexually explicit material.On appeal, the United States Court of Appeals for the Second Circuit reviewed the application of the pattern enhancement, the substantive reasonableness of the sentence, and the procedural reasonableness of the special conditions of supervised release. The court held that the district court correctly applied the pattern enhancement, finding that the two acts of abuse were separate instances under the relevant guideline, drawing on the Supreme Court’s reasoning in Wooden v. United States. The appellate court also found the sentence substantively reasonable and upheld the special conditions of supervised release. The judgment of the district court was affirmed. View "United States v. Bullock" on Justia Law