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

In this case, the defendant, Douglass Mackey, was convicted of conspiring to injure citizens in the exercise of their right to vote in violation of 18 U.S.C. § 241. The conviction was based on three memes he posted or reposted on Twitter shortly before the 2016 presidential election, which falsely suggested that supporters of then-candidate Hillary Clinton could vote by text message.The United States District Court for the Eastern District of New York (Donnelly, J.) oversaw the trial, where a jury found Mackey guilty. Mackey appealed, arguing that the evidence was insufficient to prove that he knowingly agreed to join the charged conspiracy. The government presented evidence of Mackey's participation in several private Twitter message groups where members discussed strategies to influence the election, including the creation and distribution of misleading memes. However, Mackey was not a member of these groups during the critical period when the conspiracy was allegedly formed and discussed.The United States Court of Appeals for the Second Circuit reviewed the case. The court found that the government failed to provide sufficient evidence that Mackey knowingly agreed to join the conspiracy. The court noted that while Mackey posted the misleading memes, there was no direct evidence that he viewed or participated in the relevant discussions within the private message groups. The court emphasized that mere association with individuals involved in an unlawful undertaking is not enough to prove knowing involvement in a conspiracy.The Second Circuit concluded that the evidence was insufficient to support Mackey's conviction and reversed the judgment of the district court. The case was remanded with instructions to enter a judgment of acquittal for Mackey. View "United States v. Mackey" on Justia Law

James Coonan, a former leader of the "Westies" gang, was convicted in 1987 for crimes including racketeering, extortion, and murder, committed between the mid-1960s and mid-1980s. He was sentenced to 75 years in prison. Over his 38 years of incarceration, Coonan has unsuccessfully sought parole multiple times. In 2023, he filed a motion for sentence reduction under 18 U.S.C. § 3582(c)(1), which allows for sentence reductions based on "extraordinary and compelling reasons."The United States District Court for the Southern District of New York denied Coonan's motion, ruling that § 3582(c)(1) does not apply to offenses committed before November 1, 1987. The court explained that the Sentencing Reform Act of 1984, which includes § 3582, only applies to offenses committed on or after that date. The First Step Act of 2018, which amended § 3582 to allow inmates to file their own motions for sentence reductions, did not change this limitation.The United States Court of Appeals for the Second Circuit reviewed the case. The court affirmed the district court's decision, holding that § 3582(c)(1) does not apply to Coonan's pre-1987 offenses. The court emphasized that the Sentencing Reform Act's effective date and its applicability only to post-November 1, 1987, offenses remain unchanged by the First Step Act. The court also rejected Coonan's arguments based on legislative intent and constitutional avoidance, finding no ambiguity in the statute that would allow for a different interpretation. Thus, Coonan remains ineligible for a sentence reduction under § 3582(c)(1). View "United States v. Coonan" on Justia Law

Plaintiff-Appellant Mollie Marie Flinton applied for Social Security disability insurance and supplemental security income benefits in August 2015, citing mental health disabilities. Her application was initially denied, and she requested an administrative hearing. ALJ Mark Solomon, who was not properly appointed at the time, conducted the hearing and denied her benefits in March 2018. Flinton appealed, and the United States District Court for the Southern District of New York remanded the case for a new hearing in 2020. Despite the remand, Flinton appeared again before ALJ Solomon in August 2021, whose appointment had been ratified by then.The United States District Court for the Southern District of New York, presided over by Magistrate Judge Gary R. Jones, granted a motion for judgment on the pleadings in favor of the Commissioner of Social Security in September 2023. The court found that the ALJ’s decision was supported by substantial evidence and that remanding the case to a new ALJ was unnecessary, despite acknowledging the Appointments Clause challenge.The United States Court of Appeals for the Second Circuit reviewed the case and held that, pursuant to Lucia v. SEC, Flinton was entitled to a new hearing before a different, properly appointed ALJ. The court found that ALJ Solomon’s initial decision was invalid due to his improper appointment and that the subsequent hearing before the same ALJ did not cure the constitutional violation. The court vacated the district court’s decision and remanded the case to the Commissioner for a de novo hearing before a different, validly appointed ALJ. View "Flinton v. Comm'r of Soc. Sec." on Justia Law

Two defendants, Hernán Lopez, a top executive at Twenty-First Century Fox, and Full Play Group, S.A., a South American sports marketing company, were convicted of conspiracy to commit honest services wire fraud related to a FIFA corruption scandal. They were involved in bribery schemes to secure media rights for various soccer tournaments, including the Copa Libertadores, Copa América, and World Cup qualifiers. The government presented evidence that Full Play bribed officials from several South American soccer federations, while Lopez was implicated in a scheme involving T&T Sports Marketing, a joint venture of Fox and Torneos y Competencias, to secure undervalued media rights contracts through bribery.The United States District Court for the Eastern District of New York initially denied pre-trial motions to dismiss the indictment but later granted post-trial motions for acquittal under Rule 29(c). The district court reasoned that, following the Supreme Court’s decisions in Percoco v. United States and Ciminelli v. United States, the conduct did not fall within the scope of honest services wire fraud under 18 U.S.C. § 1346, and the evidence was insufficient to sustain the convictions.The United States Court of Appeals for the Second Circuit reviewed the case and held that the district court erred in its conclusion. The appellate court determined that the conduct of Lopez and Full Play did fall within the ambit of § 1346, as it involved bribery, which is a core application of the honest services fraud statute. The court noted that the fiduciary duties breached by the bribed officials were established by their relationships with FIFA and CONMEBOL, and these duties were informed by the organizations' codes of ethics. Consequently, the Second Circuit vacated the district court’s judgments of acquittal and remanded the case for further proceedings consistent with its opinion. View "United States v. Lopez" on Justia Law

In 2021, the Federal Reserve Bank of New York implemented a policy requiring all employees to be vaccinated against Covid-19, with exemptions for religious or medical reasons. Lori Gardner-Alfred and Jeanette Diaz, employees of the Federal Reserve, applied for religious exemptions, claiming that the vaccine conflicted with their religious beliefs. The Federal Reserve denied their requests and subsequently terminated their employment for non-compliance with the vaccination policy. Gardner-Alfred and Diaz filed a lawsuit, alleging that the Federal Reserve's actions violated their religious liberties under the Free Exercise Clause of the First Amendment and various federal statutes.The United States District Court for the Southern District of New York granted summary judgment in favor of the Federal Reserve on all federal claims. The court found no genuine dispute of fact regarding the sincerity of Gardner-Alfred's religious objections and concluded that the vaccination policy did not conflict with Diaz's professed religious beliefs. Additionally, the district court imposed discovery sanctions on Gardner-Alfred and Diaz for repeatedly neglecting their discovery obligations, withholding relevant documents, and violating court orders.The United States Court of Appeals for the Second Circuit reviewed the case. The court affirmed the district court's summary judgment on Gardner-Alfred's claims, agreeing that she failed to provide sufficient evidence of sincerely held religious beliefs. However, the court vacated the summary judgment on Diaz's claims, finding that there were disputed issues of material fact regarding the sincerity of her religious beliefs and whether the vaccination policy burdened those beliefs. The court also upheld the district court's imposition of discovery sanctions, finding no abuse of discretion. The case was remanded for further proceedings consistent with the appellate court's opinion. View "Gardner-Alfred v. Federal Reserve Bank of New York" on Justia Law

Petitioners-Appellants were on the losing end of an arbitration held in Geneva, Switzerland, which resulted in the award of a substantial monetary sum, declaratory relief, and costs and attorneys’ fees to Respondents-Appellees. In accordance with an agreement between the parties that New York courts would have exclusive jurisdiction over all matters concerning the arbitration, Petitioners-Appellants filed a petition to vacate the arbitral awards in the U.S. District Court for the Southern District of New York.The district court denied the petition, concluding that it lacked subject-matter jurisdiction to vacate the Swiss-made awards under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”) because, in the district court’s view, the awards may only be vacated in the country where they were made, Switzerland.Petitioners-Appellants appealed to the United States Court of Appeals for the Second Circuit, arguing that the New York Convention does not mandate that all vacatur proceedings take place in the country that produced an award and that the parties were free to contract for a non-Swiss forum to adjudicate issues arising from the arbitration.The Second Circuit concluded that the district court correctly determined that it lacked subject-matter jurisdiction over the petition to vacate. The court explained that Chapter 2 of the Federal Arbitration Act endows a district court with subject-matter jurisdiction over “[a]n action or proceeding falling under the [New York] Convention.” However, the New York Convention primarily concerns the recognition and enforcement of arbitral awards in countries other than that in which an award was made. It does not contemplate a petition to vacate a foreign-made arbitral award. Therefore, the court affirmed the judgment of the district court. View "Molecular Dynamics, Ltd. v. Spectrum Dynamics Med. Ltd." on Justia Law

Plaintiffs filed a class action lawsuit against Kimberly-Clark Corporation, alleging that the company falsely advertised its bathroom wipes as flushable, leading consumers to pay a premium and causing plumbing damage. The parties reached a settlement where Kimberly-Clark agreed to pay up to $20 million in compensation to the class and up to $4 million in attorney’s fees. However, class members claimed less than $1 million. The district court approved the settlement under Rule 23(e) of the Federal Rules of Civil Procedure.The United States District Court for the Eastern District of New York approved the settlement, finding it fair, reasonable, and adequate. Objector Theodore H. Frank appealed, arguing that the settlement disproportionately benefited class counsel, who received most of the monetary recovery. Frank contended that the district court failed to properly assess the allocation of recovery between the class and class counsel.The United States Court of Appeals for the Second Circuit reviewed the case and agreed with Frank that the district court applied the wrong legal standard in its Rule 23(e) analysis. The appellate court clarified that Rule 23(e) requires courts to compare the proportion of total recovery allocated to the class with the proportion allocated to class counsel. The court vacated the district court’s order and judgment approving the settlement and remanded the case for further proceedings consistent with this opinion. The appellate court did not reach a conclusion on whether the settlement was fair but emphasized the need for a proper proportionality analysis. View "Kurtz v. Kimberly-Clark Corp." on Justia Law

George Guldi, a former Suffolk County legislator and disbarred real estate attorney, conspired with his former girlfriend, Victoria Davidson, to deceive a mortgage servicer, Ditech Financial LLC, into wiring them $253,236. The funds did not belong to either of them. A jury convicted Guldi of wire fraud, bank fraud, and conspiracy to commit wire fraud and bank fraud. He was sentenced to 36 months of imprisonment followed by three years of supervised release.The United States District Court for the Southern District of New York oversaw the trial. The jury found sufficient evidence to support the existence of a conspiracy, fraudulent intent, and aiding and abetting. The district court also found no reversible error in its jury instructions on conspiracy, wire fraud, and fraudulent intent. Additionally, the court properly considered Guldi’s medical needs during sentencing.The United States Court of Appeals for the Second Circuit reviewed the case. The court affirmed Guldi’s convictions, finding that sufficient evidence supported the jury’s findings and that the district court did not err in its jury instructions. However, the appellate court concluded that the district court erred in applying a two-offense-level enhancement under the U.S. Sentencing Guidelines for using “sophisticated means” to commit or conceal the offense. The appellate court determined that this procedural error rendered Guldi’s sentence procedurally unreasonable.As a result, the Second Circuit affirmed the judgment of conviction but vacated and remanded Guldi’s sentence for resentencing consistent with its opinion. View "United States v. Guldi" on Justia Law

Josiah Galloway sued five current and former Nassau County detectives, alleging they violated his constitutional right to a fair trial by improperly inducing witnesses to identify him as the perpetrator of a 2008 crime, coercing a witness to sign a statement implicating him, and withholding evidence of these deficiencies in violation of Brady v. Maryland. Galloway also sued Nassau County for state-law malicious prosecution. Galloway was exonerated after serving nearly a decade in prison for a crime he did not commit.The United States District Court for the Eastern District of New York denied the detectives' motion for summary judgment, which included a claim of qualified immunity. The court adhered to this decision on reconsideration. The detectives and the county appealed, seeking to reverse the denial of their motion for summary judgment. However, the appellate court's jurisdiction was limited to the defense of qualified immunity and only as a matter of law.The United States Court of Appeals for the Second Circuit reviewed the case. The court held that by 2008, it was clearly established that detectives could not rig witness identifications, coerce a witness to sign a false inculpatory statement, or ensure that the state withheld Brady evidence from the defense. Therefore, the district court did not commit legal error in rejecting the detectives' qualified immunity defenses. The court dismissed Nassau County's appeal and affirmed the district court's decision in all other respects. View "Galloway v. County of Nassau" on Justia Law

In 2021, Xeriant, Inc., an aerospace company, sought financing for a joint venture and connected with Auctus Fund LLC, a hedge fund. Auctus agreed to lend approximately $5 million through a convertible promissory note, allowing Auctus to convert the debt into shares of Xeriant's common stock if the loan was not repaid in cash. When Xeriant failed to repay the loan, Auctus attempted to convert the debt into stock, but Xeriant rejected the request and filed a lawsuit seeking to void the contract under the Securities Exchange Act of 1934, claiming Auctus was not a registered securities dealer.The United States District Court for the Southern District of New York dismissed Xeriant's complaint, holding that the contract did not obligate Auctus to act as a dealer, and thus, the agreement was not void under Section 29(b) of the Exchange Act. The court found that the Securities and Exchange Commission (SEC), not private parties, enforces the registration requirement under Section 15(a) of the Exchange Act.The United States Court of Appeals for the Second Circuit reviewed the case and affirmed the district court's decision. The appellate court agreed that Xeriant failed to allege a sufficient claim for rescission under Section 29(b) because the contract did not require Auctus to engage in unlawful dealer activity. The court concluded that the contract could be performed lawfully and was not inherently illegal. Therefore, the contract could not be rescinded under Section 29(b) of the Exchange Act. The court also held that Xeriant's claim was timely filed, as the facts underlying Auctus's alleged status as an unregistered dealer were not appreciable until the SEC filed its complaint in June 2023. View "Xeriant, Inc. v. Auctus Fund LLC" on Justia Law