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

Defendant defrauded his former employer and its investors of some $65 million. He was indicted on unrelated insider trading charges, and a subsequent internal investigation revealed the full breadth of his wrongdoing. The Securities and Exchange Commission (“SEC”) brought a civil enforcement action against Defendant. To secure a potential disgorgement judgment, the SEC joined Defendant’s family and related entities as Relief Defendants, and the district court froze Defendant’s and the Relief Defendants’ assets. Defendant is currently a fugitive from justice, so the district court excluded him from discovery of the SEC’s investigative file. The district court granted the SEC’s motion for summary judgment and awarded disgorgement, supplemental enrichment, and civil penalties against Defendant. The district court also adopted the SEC’s theory that Defendant is the equitable owner of assets held in the name of the Relief Defendants as “nominees.” On appeal, Defendant and the Relief Defendants challenged the district court’s judgment and calculation of disgorgement.   The Second Circuit affirmed in part and vacated and remanded in part. The court affirmed the district court’s (1) exclusion of Defendant from discovery and denial of his access to frozen funds to hire counsel; (2) calculation of Defendant’s disgorgement obligation; and (3) retroactive application of the 2021 amendments to the Securities Exchange Act of 1934 to Defendant’s disgorgement obligation. However, the court held that the district court (4) failed to assess whether actual gains on the frozen assets were unduly remote from Defendant’s fraud and (5) should have applied an asset-by-asset approach to determine whether the Relief Defendants are, in fact, only nominal owners of their frozen assets. View "SEC v. Ahmed" on Justia Law

Plaintiff Hughes Communications India Private Limited (“Hughes India”) appealed from a district court judgment dismissing its indemnification claims against The DirecTV Group, Inc. (“DirecTV”). The case arises out of an asset purchase agreement in which DirecTV spun off fourteen subsidiaries, including Hughes India (the “Agreement”). The Agreement requires DirecTV to indemnify Hughes India for certain contractually defined “Taxes” that accrued before the closing of the spin-off transaction and “Proceedings” that were initiated prior to the closing date. Hughes India sought a declaration that DirecTV must indemnify it for unpaid license fees, interest, and penalties imposed by India’s Department of Telecommunications (the “DOT”). The district court granted summary judgment for DirecTV, concluding that the license fees were not subject to indemnification because they were neither Taxes nor the result of Proceedings against Hughes India as defined by the Agreement. Hughes India appealed.   The Second Circuit vacated the district court’s judgment and remanded the case to the district court for further proceedings. The court agreed with Hughes India that under the plain terms of the Agreement, the license fees are Taxes, and the Provisional License Fee Assessment (the “Provisional Assessment”) issued by the DOT initiated a Proceeding against Hughes India. The court concluded that DirecTV is obligated to indemnify Hughes India for license fees, interest, and penalties accrued for tax periods ending on or before closing and for those amounts related to the Provisional Assessment issued for fiscal years 2001 to 2003, which was the only Proceeding initiated before closing. View "Hughes Communications India Private Limited v. The DirecTV Group, Inc." on Justia Law

Plaintiff, an aspiring sidewalk counselor, brought a First Amendment challenge to Westchester County’s recently enacted “bubble zone” law, which makes it illegal to approach within eight feet of another person for the purpose of engaging in “oral protest, education, or counseling” when inside a one-hundred-foot radius of a reproductive health care facility. The district court dismissed the complaint, holding that Plaintiff lacks standing to mount a pre-enforcement challenge to the bubble zone law and that, in any event, the Supreme Court’s decision in Hill v. Colorado, 530 U.S. 703 (2000) forecloses her First Amendment claim.   The Second Circuit vacated the district court’s ruling insofar as it dismissed Plaintiff’s suit for lack of standing. The court nevertheless affirmed the judgment on the merits because the district court correctly concluded that Hill is dispositive of Plaintiff’s First Amendment claim. The court concluded that Plaintiff has standing to seek pre-enforcement relief because she has pleaded sufficient facts to support a credible threat that Westchester County will enforce the bubble zone law if she pursues her stated intention to engage in sidewalk counseling. View "Vitagliano v. County of Westchester" on Justia Law

Appellants in these tandem appeals are each a parent of a disabled child. Arguing that his or her child was entitled to benefits under the Individuals with Disabilities Education Act (“IDEA”), 20 U.S.C. Section 1415(i), each parent brought an administrative action against his or her local education agency and prevailed. Subsequently, each parent brought a federal action for attorneys’ fees pursuant to 20 U.S.C. Section 1415(i)(3)(B). In each case, the district court awarded less attorneys’ fees than the parent requested, and the parents appealed.   The Second Circuit reversed the district court’s denial of travel-related fees in No. 21-1961 and remanded for further proceedings. The court otherwise affirmed the judgments of the district courts. The court found that it was persuaded that there was no abuse of discretion in the district court’s calculation of reasonable attorneys’ fees in each case. Further, the court wrote that the district courts that declined to award prejudgment interest did not abuse their discretion because “delays in payment” may be remedied by “application of current rather than historic hourly rates.” However, the court held that the district court abused its discretion when it denied any travel-related fees to M.D.’s counsel. A district court may permissibly adjust excessive travel costs. But the district court could not “eliminate all of the hours submitted by [CLF] as travel time” by denying travel-related fees altogether. View "H.C. v. NYC DOE, et al." on Justia Law

Petitioners filed successive habeas corpus petitions challenging their convictions and mandatory sentences imposed by the district court. The district court held that their substantive RICO convictions, on which their Section 924(c) convictions were based, were valid “crimes of violence.”This appeal focuses on their convictions under Count Thirteen of the indictment, which charged them with using and carrying firearms during and in relation to a crime of violence, 18 U.S.C. Section 924(c), based on an offense charged in Count One, racketeering activity in violation of RICO.   The Second Circuit affirmed. The court explained that the jury was instructed that it could base Petitioners’ Section 924(c) convictions upon a predicate offense, which, according to the Supreme Court’s subsequent interpretations of the term, was not a “crime of violence.” The jury’s findings rendered under those (later determined to be erroneous) instructions do not specify whether it found that the defendants committed a variation of New York larceny by extortion that necessarily requires the actual or threatened use of force. Nor did the written jury findings specify whether the predicate offense related to second-degree grand larceny by extortion was the substantive offense or conspiracy or attempt to commit the offense. Nonetheless, reviewing the jury’s verdict in relation to the evidence presented at trial, the court concluded with a high degree of confidence that, if properly instructed, the jury would have predicated Petitioners’ Section 924(c) convictions on a valid crime of violence. View "U.S. v. Colotti" on Justia Law

Petitioner sought a review of a decision of the Board of Immigration Appeals (“BIA”) dismissing her appeal, ordering her removed, and denying her application for cancellation of removal. The BIA ordered that she be removed under 8 U.S.C. Section 1227(a)(2)(A)(i)(I) for having been convicted of a crime involving moral turpitude (“CIMT”). Specifically, the BIA and Immigration Judge (“IJ”) determined that a conviction under Arkansas Code Annotated (“ACA”) Section 5-60-101 is categorically a CIMT.   The Second Circuit reversed. The court concluded that a conviction under ACA Section 5- 60-101 is not categorically a CIMT because the statute criminalizes conduct that is not “inherently base, vile, or depraved.” The court explained that the BIA did not conduct an elements-based categorical inquiry. Instead, it applied an inapposite “realistic probability” test. That test “operates as a backstop when a statute has indeterminate reach, and where minimum conduct analysis invites improbable hypotheticals.” It applies only when there is a match between the state statute and federal standard, but a petitioner posits imaginative scenarios in which the state statute would be violated in such a way that does not meet the requirements of a CIMT. View "Giron-Molina v. Garland" on Justia Law

Plaintiffs-Appellants are American victims and the relatives and estates of victims of terrorist attacks in Israel between 2001 and 2003. Plaintiffs alleged that Palestine Investment Bank ("PIB") facilitated the attacks, in violation of the Anti-Terrorism Act, 18 U.S.C. 2213-39D. The district court dismissed the case on the ground that it lacked personal jurisdiction over PIB.Federal Rule of Civil Procedure 4(k)(1)(A) permits a federal court to exercise personal jurisdiction over a defendant to the extent allowed by the law of the state in which it sits. New York's long-arm statute, C.P.L.R. 302(a)(1) authorizes personal jurisdiction over a foreign defendant for causes of action that arise out of “transact[ing] any business within the state,” whether in person or through an agent. in this context, transacting business means “purposeful activity—some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State," invoking the benefits of the state's laws.Here, the PIB's actions indicated that it availed itself of the benefits of New York's financial system and that Plaintiff's claim arose from these activities. View "Spetner v. PIB" on Justia Law

Magellan, a manufacturer of electronic nicotine delivery systems (“ENDS”) products, sought authorization from the FDA to market ENDS under the Family Smoking Prevention and Tobacco Control Act (the “TCA”). The FDA denied Magellan's application related to the company's flavored ENDS products, finding insufficient evidence showing that marketing the pods would be appropriate for the protection of public health, a finding that requires denial of an application under the TCA. Magellan petitioned for review, arguing the FDA action was arbitrary and capricious. Magellan also argues that the FDA exceeded its statutory authority by requiring applicants to demonstrate that their flavored ENDS products are more effective than tobacco-flavored products at promoting cessation or switching from combustible cigarettes to ENDS products.The Second Circuit affirmed. The FDA did not impose a new evidentiary standard on Magellan; therefore, the FDA did not need to provide notice or consider its reliance interests. Thus, the court concluded that the FDA did not act arbitrarily or capriciously. View "Magellan Technology, Inc. v. United States Food and Drug Administration" on Justia Law

Petitioner is a 32-year-old native and citizen of Jamaica who entered the United States in 2006 and overstayed his visitor visa. On December 20, 2017, Immigration and Customs Enforcement ("ICE") officers arrested Petitioner pursuant to a warrant issued by the Department of Homeland Security ("DHS"). In removal proceedings before the IJ, Petitioner argued that the immigration court lacked jurisdiction over his removal proceedings and the officers violated agency regulations and his fundamental rights during his arrest and interrogation.   The Second Circuit denied the petition. The court agreed that the agency had jurisdiction and that termination of the removal proceeding was not warranted. The court explained under Rajah termination may be warranted for pre-hearing regulatory violations in cases involving "prejudice that may have affected the outcome of the proceeding, conscience-shocking conduct, or a deprivation of fundamental rights." As Petitioner has failed to show that he satisfies any of the three requirements for termination, he is not entitled to termination of his removal proceedings, with or without prejudice to renewal. Accordingly, the court found that the immigration court did not abuse its discretion in denying the motions to terminate. View "Medley v. Garland" on Justia Law

Defendant appealed from a judgment of conviction on multiple counts of substantive and conspiratorial Hobbs Act robbery and of the brandishing of a firearm during two crimes of violence (i.e., the charged robberies). Defendant argued that the district court erred (1) in relying on the inevitable discovery doctrine to deny his motion to suppress evidence obtained through warrants supported by concededly defective affidavits and (2) in charging the jury that a gun constitutes a firearm and refusing to give his requested jury instruction.   The Second Circuit vacated Defendant’s firearms convictions. The court agreed with Defendant that the inevitable discovery doctrine does not apply in the circumstances of this case, and because the conceded misstatements in the affidavits were material to the issuing magistrate judges’ probable cause determinations, remand is required for the district court to conduct a hearing to determine if the challenged evidence was admissible under the standard identified in Franks v. Delaware, 438 U.S. 154 (1978). As to the jury charge, the district court erred in instructing the jury that a gun is a firearm. The court wrote that it cannot conclude that this error was harmless as a matter of law. View "United States v. Lauria (Molina)" on Justia Law