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

This appeal stemmed from the collapse of the hedge fund Lipper Convertibles. On appeal, plaintiffs challenged the district court's grant of summary judgment on their federal claims against Lipper Convertibles' auditor, PwC, under Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. 78a et seq., as well as their state law claims of fraud and negligent misrepresentation. The court concluded that there was a genuine dispute as to whether plaintiffs suffered a direct injury at the time of investment by purchasing their shares in Lipper Convertibles funds at fraudulently inflated prices. Accordingly, the court vacated the district court's grant of summary judgment on the Section 10(b) claims and remanded to the district court to consider in the first instance PwC's scienter argument and for further proceedings. The court affirmed the state law claims. View "CILP Assocs., L.P. v. PriceWaterhouse Coopers LLP" on Justia Law

Defendant appealed his conviction for possession of a firearm after a felony conviction. The district court denied defendant's motion to suppress the firearm discovered by the police. Defendant argued that he was stopped without reasonable suspicion because the stop was primarily based upon a pair of anonymous 911 calls from the same caller. The court reversed and remanded, holding that there was no reasonable suspicion to support the stop. The government failed to identify the specific and articulable facts that would have justified a stop of defendant at that point in time. Accordingly, the court vacated the conviction. View "United States v. Freeman" on Justia Law

Plaintiff filed suit against defendants for overtime wages. The parties eventually agreed to a settlement. The district court approved the settlement and granted plaintiff's motion for attorneys' fees. Defendants subsequently appealed the district court's decision on plaintiff's motion for attorneys' fees. The court dismissed the appeal for lack of jurisdiction because the appeal was untimely where the entry of judgment did not restart the time to appeal. View "Perez v. AC Roosevelt Food Corp." on Justia Law

Defendant was convicted of cocaine offenses and related gun possession. Defendant, pro se, moved to recall the court's mandates related to his conviction, and to reinstate his direct appeal in order to seek relief under the Supreme Court's recent holding in Alleyne v. United States. The court could not authorize defendant's collateral attack where a new rule was not made retroactive to cases on collateral review unless the Supreme Court holds it to be retroactive. The Supreme Court announced the Alleyne rule on a direct appeal without expressly holding it to be retroactive to cases on collateral review. Further, Alleyne does not fall within a category of cases previously held to be retroactive. Defendant's remaining contentions were without merit. Accordingly, the court denied defendant's motion, construing it as one for leave to file a successive 28 U.S.C. 2255 motion. The court also denied defendant's motion for appointment of counsel as moot. View "United States v. Redd (Shue)" on Justia Law

Defendant pled guilty to cocaine distribution. On appeal, defendant challenged the district court's denial of a motion for sentencing modification. At issue was what procedure a district court should follow under 18 U.S.C. 3582(c). The court concluded that the district court must engage in a two-step approach under Dillon v. United States and United States v. Wilson. The court reversed and remanded for the district court to (1) specifically determine defendant's eligibility for a sentencing modification; and (2) consider whether any applicable 18 U.S.C. 3553(a) factors counseled in favor of a reduction. View "United States v. Bethea" on Justia Law

The SEC settled an enforcement action against firms that executed trading orders on the New York Stock Exchange and placed the money obtained as a result of the enforcement actions into funds for distribution to injured customers. The SEC ordered the remaining funds to be disbursed to the United States Treasury. On appeal, petitioner, who had filed class actions against the firms, challenged the SEC's disbursement order seeking to invoke the court's statutory jurisdiction under 15 U.S.C. 78y. The court concluded that petitioner failed to plead an injury in fact sufficient to afford it Article III standing. For every Covered Transaction in which petitioner was identified as the injured customer, petitioner had already received a distribution from the Fair Funds that fully compensated it for that Covered Transaction. Accordingly, the court dismissed the petition for lack of subject matter jurisdiction. View "Martin v. U.S. S.E.C." on Justia Law

Plaintiff appealed the district court's dismissal of this qui tam action and disqualifying plaintiff, its individual members - including a former general counsel to defendant - and its outside counsel from bringing a subsequent qui tam action on the basis that the suit was brought in violation of the general counsel's ethical obligations under the New York Rules of Professional Conduct. The court concluded that the attorney, through his conduct in this qui tam action, did violate N.Y. Rule 1.9(c) which prohibited lawyers from using confidential information of a former client protected by Rule 1.6 to the disadvantage of the former client. The court held that the district court did not err by dismissing the complaint as to all defendants, and disqualifying plaintiff, its individual relators, and its outside counsel on the basis that such measures were necessary to avoid prejudicing defendants in any subsequent litigation on these facts. View "Fair Labor Practices Assocs. v. Quest Diagnostics, Inc." on Justia Law

NYPPP filed suit against election officials and others to enjoin enforcement of New York State Election Law 14-114(8) and 14-126(2). Section 14-114(8) imposed a $150,000 aggregate annual limit on certain political contributions by any person in New York State. Section 14-126(2) made it a misdemeanor to fail to file required statements or to knowingly and willfully violate any other provision of the Election Law. NYPPP would be prevented from receiving more than $150,000 from any individual contributor in any calendar year. The court concluded that NYPPP had a substantial likelihood of success on the merits; there were important public interests at stake which were weighed against the hardships suffered by NYPPP; and the hardships faced by NYPPP and its donors from the denial of relief was significant. Accordingly, the court reversed the district court's order denying the preliminary injunction. View "New York Progress and Protection PAC v. Walsh, et al." on Justia Law

Defendant appealed his conviction for conspiring to bomb the United States embassies in Nairobi, Kenya and Dar es Salaam, Tanzania. At issue was whether the Speedy Trial Clause of the Sixth Amendment prevented the United States from trying, on criminal charges in a district court, a defendant who was held abroad for several years in the CIA and the Department of Defense while his indictment was pending. The court concluded that the district court did not err in determining, pursuant to the Supreme Court's four-factor balancing test under Barker v. Wingo, that the nearly five-year delay between defendant's capture and his arraignment, during which time he was interrogated as an enemy combatant and detained at Guantanamo Bay, did not constitute a violation of the Speedy Trial Clause; the district court did not err in charging the jury with a conscious avoidance instruction or in formulating that instruction; and defendant's sentence of life imprisonment was neither procedurally nor substantively unreasonable. Accordingly, the court affirmed the judgment of the district court. View "United States v. Ghailani" on Justia Law

Defendant appealed her conviction of conspiracy to commit securities fraud and wire fraud, as well as insider trading. Defendant's scheme was to obtain from her tippers earnings data of their employer companies and convey this data to her tippees before those companies' quarterly financial results were publicly released. The court concluded that the district court did not err in admitting evidence that defendant claimed was recorded in violation of Title III of the Omnibus Crime Control and Safe Streets Act of 1968, 18 U.S.C. 2510-22, because the recordings and transcripts at issue were made in the ordinary course of business and admissible under section 2510(5)(a)(i). Furthermore, they were made with the consent of a party to the communication and admissible under section 2511(2)(d). The court also concluded that the evidence was sufficient to convict defendant of insider trading where the tippers were entrusted the duty to protect confidential information, which they breached by disclosing to their tippee, who knew of their duty and still used the information to trade a security or further tip the information for defendant's benefit, and the tippers benefited in some way from their disclosures. Accordingly, the court affirmed the conviction and sentence. View "United States v. Jiau" on Justia Law