by
Contractual disclaimers of reliance on prior misrepresentations do not render those misrepresentations immaterial under the criminal mail and wire fraud statutes. The Second Circuit affirmed defendant's conviction and sentence for conspiring to commit mail and wire fraud, substantive counts of both, and making false statements to a government agent. Defendant's conviction stemmed from his work at Vendstar, a company that sold valueless vending machine business opportunities to its victims. The court held that, although contractual disclaimers were relevant to the jury's determination of defendant's guilt, they did not render extra-contract misrepresentations immaterial as a matter of law. View "United States v. Weaver" on Justia Law

by
Defendants Burden and Buchanan were sentenced to life imprisonment based on their convictions for, among other things, racketeering, violent crimes in aid of racketeering, and conspiracy to distribute and possess with intent to distribute more than 50 grams of cocaine base and five kilograms or more of cocaine. The Second Circuit held that defendants' appeal waivers were enforceable, but construed them narrowly so as not to encompass defendants' appeals of their terms of supervised release. The court declined to resolve whether the district court erred in failing to advise defendants that they faced terms of supervised release, because even assuming that it did, the error was not plain. However, plain error was committed when the district court implicitly hinged defendants' life terms of supervised release on the need for retribution—an imperative that was relevant to fashioning a term of incarceration, but not to fashioning a term of supervised release. Accordingly, the court vacated the terms of supervised release and remanded for resentencing. The court affirmed in all other respects. View "United States v. Burden" on Justia Law

Posted in: Criminal Law

by
Plaintiff filed suit against defendant and the University, alleging a claim of retaliation based on his complaint of sexual harassment. The district court granted defendants' motion to dismiss. The Second Circuit applied the plausibility standard to plaintiff's retaliation claim and held that it was plausible that he was denied a teaching position after he declined sexual approaches from the man who was his teacher and the department chair. Accordingly, the court vacated in part and remanded for further consideration of the retaliation claims. View "Irrera v. Humpherys" on Justia Law

by
A group of hotel-related businesses, as well as investors and guarantors, filed suit alleging claims of fraud against the Royal Bank and two of its subsidiaries. The district court dismissed the claims because plaintiffs had failed to list their cause of action in a schedule of assets in their now-concluded bankruptcy proceeding, they lacked standing to bring the claim, and were barred by judicial estoppel. The claims of the investor and guarantors were dismissed as untimely and barred by the law of the case. The Second Circuit affirmed on the grounds of judicial estoppel and timeliness. The court held that, under Fifth Circuit law, the kind of LIBOR-fraud claim that BPP wanted to assert was "a known cause of action" at the time of confirmation, so that BPP's failure to list it in the schedule of assets was equivalent to a representation that none existed; the bankruptcy court "adopted" BPP's position; and BPP's assertion of the claims now would allow it to enjoy an unfair advantage at the expense of its former creditors. Furthermore, plaintiffs have not shown good cause for an untimely amendment, and the district court properly denied leave to amend. View "BPP Illinois v. Royal Bank of Scotland Group PLC" on Justia Law

Posted in: Banking, Bankruptcy

by
The Water District appealed from the district court's judgment in a consolidated multidistrict litigation granting summary judgment to BP and Shell on the ground that the Water District's suit was barred by res judicata arising from 2002 and 2005 settlements. Claims against BP and Shell for MTBE contamination had been brought by the Orange County District Attorney (OCDA) in 1999 and were settled in 2002 and 2005 respectively. The Second Circuit vacated and remanded the Water District's claims against BP and Shell, holding that the Water District and OCDA were not in privity. View "In re Methyl Tertiary Butyl Ether (MTBA) Products Liability Litigation" on Justia Law

by
Plaintiff filed suit alleging that defendant, the principal of Capital Prep, violated plaintiff's First Amendment right of freedom of assembly and his state-law right to be free from the intentional infliction of emotional distress in banning plaintiff from attending virtually all Capital Prep events, on or off school property, because of his opposition to defendant's bullying and harassing efforts to compel plaintiff's daughter to remain a member of the girls varsity basketball team. The district court denied defendant's motion for summary judgment based on qualified immunity. The Second Circuit dismissed the appeal insofar as it related to the claimed due process violation, holding that the claim was not properly before the court. As to the First Amendment claim, the court held that defendant's motion for summary judgment was properly denied to the extent that plaintiff complained of being banned from events beyond school property and from sports contests on school property to which the public was invited; but defendant was entitled to qualified immunity as a matter of law to the extent that he banned plaintiff from school property otherwise. Accordingly, the court affirmed in part, reversed in part, and dismissed in part. View "Johnson v. Perry" on Justia Law

by
Defendant Cummings was convicted of drug and firearms charges related to causing the death of a person. The Second Circuit held that the district court erred by admitting hearsay evidence of a death threat he allegedly made against a government witness, and such error was not harmless. In this case, the hearsay was especially toxic because it created a grave risk that the jury would use it as evidence of Cummings's murderous propensity. The court explained that risk was heightened by the lack of a limiting instruction, the similarity between the death threat and the underlying charges, the government's argument on summation suggesting that the threat was substantive proof of Cummings's guilt, and his inability to cross‐examine the third‐party declarant who heard his alleged threat. Accordingly, the court vacated Cummings's convictions and remanded for a new trial. The court also granted Defendant Nwanko's counsel's Anders motion to withdraw as counsel and issued an order simultaneously with this opinion. View "United States v. Cummings" on Justia Law

Posted in: Criminal Law

by
Former employees of World Airways challenged the dismissal of their complaint seeking damages for fraud, breach of contract and violation of an employee benefit plan. The Second Circuit agreed with the district court that plaintiffs' state law claims arose under the Railway Labor Act (RLA), 45 U.S.C. 151 et seq., and were thus preempted. Because those claims bear a close resemblance to claims brought pursuant to the Employee Retirement Income Securities Act (ERISA), 29 U.S.C. 1001 et seq., the court found it appropriate to borrow and apply the three‐year statute of limitations set forth in Section 1113 of ERISA rather than the six‐month limitations period the district court borrowed from Section 10(b) of the National Labor Relations Act (NLRA), 29 U.S.C.160(b). Accordingly, the court vacated the dismissal of the RLA claims and remanded for further consideration. The court affirmed in all other respects. View "Pruter v. Local 210’s Pension Trust Fund" on Justia Law

by
After a jury awarded damages based on CSS's avoided costs in a misappropriation and unfair competition action, TydenBrooks requested mandatory prejudgment interest under section 5001(a) of the New York Civil Practice Law and Rules (CPLR). The Second Circuit affirmed the district court's denial of relief insofar as it related to CSS's liability. The court otherwise reserved judgment as to damages and certified the following questions to the New York Court of Appeals: 1. Whether, under New York law, a plaintiff asserting claims of misappropriation of a trade secret, unfair competition, and unjust enrichment can recover damages that are measured by the costs the defendant avoided due to its unlawful activity. 2. If the answer to the first question is "yes," whether prejudgment interest under New York Civil Practice Law and Rules 5001(a) is mandatory where a plaintiff recovers damages as measured by the defendant's avoided costs. View "E.J. Brooks Co. v. Cambridge Security Seals" on Justia Law

Posted in: Business Law

by
Defendant argued that his defense counsel provided ineffective assistance of counsel based on a conflict of interest because counsel was involved in a possible secret sexual relationship with defendant's mother. The district judge questioned counsel, but counsel refused to answer the questions and is now deceased. Defendant ultimately agreed to waive any hypothetical conflicts; the district court decided that any conflict was waived; and the district court accepted defendant's guilty plea. The Second Circuit affirmed the conviction, holding that defendant's claim, considering the gaps in the record, was better suited for collateral review. Therefore, the court declined to consider the ineffectiveness argument on direct appeal and reasoned that a thorough evidentiary hearing would be justified if a habeas petition was filed. View "United States v. DeLaura" on Justia Law

Posted in: Criminal Law