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

This case arose when plaintiff, by her mother and natural guardian, brought a medical malpractice action under the Federal Tort Claims Act (FTCA), 28 U.S.C. 1346, 2401, 2671-2680, claiming that the injury plaintiff sustained at birth might have been caused by her doctor. At issue was whether plaintiff's claim was "forever barred" by the FTCA's two-year statute of limitations period. The court held that, because plaintiff failed to comply with the two-year limitations period set out in section 2401(b) and because equitable tolling, even if available, was unwarranted, the judgment of the district court dismissing the complaint as untimely was affirmed.

This case arose when the FTC alleged deceptive advertising claims against defendants based on two purported weight loss products, a Chinese Diet Tea and a Bio-Slim Patch. On appeal, defendants challenged both the power of the district court to award monetary relief and the means by which the district court calculated the award. The court held that the district court had the power to award restitution pursuant to Section 13(b) of the Federal Trade Commission Act, 15 U.S.C. 53(b). The court also held that the district court did not err in ordering defendants to disgorge the full proceeds from its sale of the products in question. Accordingly, the court affirmed the judgment of the district court.

Plaintiff, the personal representative of the Estate of Dorothy Brown, appealed from summary judgment certified as final pursuant to Federal Rule of Civil Procedure 54(b) in favor of Noxubee General Hospital (Noxubee) and Baptist Memorial Hospital-Golden Triangle (Baptist) and from a summary judgment in favor of Eli Lilly and Company (Eli Lilly). The action that gave rise to this appeal, removed from state court in Mississippi to a federal district court in Mississippi, and thereafter transferred to the Eastern District of New York, was brought to recover for the wrongful death of Ms. Brown allegedly due to her treatment with the drug Zyprexa, which was manufactured by Eli Lilly. An earlier appeal from the certified judgment in favor of Noxubee was withdrawn by stipulation. A motion to remand, predicated on the lack of diversity on the parts of Noxubee and Baptist were denied following the issuance of all the orders granting summary judgment. The court held that the appeals from the judgments entered in favor of Noxubee and Baptist were dismissed and the judgment dismissing the action against Eli Lilly were affirmed.

Plaintiffs in these four cases appealed from a judgment of the district court granting summary judgment in favor of defendant and dismissing their product liability claims for injuries allegedly caused by defendant's prescription drug, Fosamax. Plaintiffs appealed the district court's decision concluding that their product liability claims, brought under Virginia law, were not tolled by the pendency of a putative federal class action that raised identical claims and dismissing plaintiffs' claims as time-barred. The court held that the availability of "cross jurisdictional tolling" in this context raised questions of Virginia law that were appropriately certified to the Supreme Court of Virginia.

Defendant, once a practicing psychiatrist, defrauded Medicare by receiving funds he was not entitled to receive and then fled the country to live as a fugitive in the Philippines. There, defendant created the website www.liver4you.org, fraudulently promising to provide critically ill patients liver or kidney transplants for certain sums of money. Defendant was subsequently convicted of one count of health care fraud and five counts of wire fraud. Defendant appealed, arguing that the district court committed four procedural errors in calculating defendant's offense level and imposed a substantively unreasonable sentence. The government argued that the court should not consider the four procedural errors because at sentencing the district court stated it would impose "the same sentence" even without some of the alleged errors. The court rejected this contention and emphasized that such predictions were only rarely appropriate. Defendant argued that his website was not mass-marketing pursuant to U.S.S.G. 2B1.1(b)(2)(A)(ii) because he did not initiate contact with his victims where they found his website, which was publicly available online, and emailed him at an address listed on the website. The court rejected defendant's distinction and held that he committed fraud by using the internet to solicit a large number of persons to buy his organ transplant services. Therefore, the court held that the enhancement applied even if defendant did not use the most active marketing method possible. Accordingly, the court affirmed the judgment of the district court.

Defendants appealed from preliminary injunctions enjoining defendants from enforcing 22 U.S.C. 7631(f), a provision of the United States Leadership Against HIV/AIDS, Tuberculosis, and Malaria Act of 2003 (Act), 22 U.S.C. 7601 et seq., against plaintiffs, non-governmental organizations (NGOs) engaged in the international fight against HIV/AIDS that received funding under the Act. Section 7631(f), construed and implemented by defendants, required NGOs, as a condition of receiving Act funds, to adopt a policy explicitly opposing prostitution, and prohibiting recipients from engaging in any activities that were "inconsistent" with an anti-prostitution stance. The court held that section 7631(f) fell well beyond what the Supreme Court and the court have upheld as permissible conditions on the receipt of government funds where section 7631(f) did not merely require recipients of the Act's funds to refrain from certain conduct, but went substantially further and compelled recipients to espouse the government's viewpoint. Consequently, the court agreed with the district court that plaintiffs have demonstrated a likelihood of success on the merits and found no abuse of discretion by the district court.

A non-profit hospital ("plaintiff") that provided medical services to beneficiaries of Local 272 Welfare Fund ("Fund"), an employee benefit plan governed by the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. 1101, filed a complaint against defendants seeking payment for over $1 million in medical services provided to beneficiaries that the Fund had allegedly failed to reimburse. At issue was whether a healthcare provider's breach of contract and quasi-contract claims against an ERISA benefit plan were completely preempted by federal law under the two-pronged test for ERISA preemption established in Aetna Health Inc. v. Davila. The court held that an "in-network" healthcare provider may receive a valid assignment of rights from an ERISA plan beneficiary pursuant to ERISA section 502(a)(1)(B); where a provider's claims involved the right to payment and not simply the amount or execution of payment when the claim implicated coverage and benefit determinations as set forth by the terms of the ERISA benefit plan, that claim constituted a colorable claim for benefits pursuant to ERISA section 502(a)(1)(B); and in the instant case, at least some of plaintiff's claims for reimbursement were completely preempted by federal law. The court also held that the remaining state law claims were properly subject to the district court's supplemental jurisdiction.