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

Under 26 U.S.C. 7345, if a court determines that a "seriously delinquent" certification was erroneous, it may order the Secretary of the Treasury to notify the Secretary of State of that fact. No other relief is authorized. The Second Circuit affirmed the tax court's dismissal in part insofar as it dismissed certain of petitioner's claims as moot, and vacated and remanded in part with instructions to the tax court court to dismiss all the remaining claims as moot insofar as it dismissed those claims for lack of statutory jurisdiction.In 2019, petitioner filed a petition with the tax court challenging the Commissioner's certification that she had a "seriously delinquent tax debt" under 26 U.S.C. 7345. While her challenge was pending, the Commissioner reversed the certification as erroneous and so notified the Secretary of State. In 2020, the tax court dismissed the petition, holding that it lacked jurisdiction to assess the validity of her underlying liability for the penalties the IRS had assessed against her, which formed the basis for her debt, and that her challenge to her certification was moot in light of the IRS's reversal. In this case, petitioner has received all the relief to which she is entitled by statute and, to the extent that the voluntary cessation doctrine exists primarily to keep parties from acting strategically to avoid judicial review, that is not a concern here. Finally, petitioner's challenge, under section 7345, to the underlying penalties assessed against her was moot at the time the tax court issued its order. View "Ruesch v. Commissioner of Internal Revenue" on Justia Law

The Second Circuit dismissed plaintiff's appeal of the district court's judgment deeming his Federal Rule of Civil Procedure 41(a)(1)(A)(i) notice of dismissal without prejudice withdrawn and compelling arbitration. The court held that the district court properly retained jurisdiction following the notice of dismissal to conduct a Cheeks review of any possible settlement of plaintiff's Fair Labor Standards Act claims; and that the district court reasonably interpreted his request to continue the litigation as a withdrawal of the notice of dismissal, and, in its discretion, deemed it withdrawn. Therefore, plaintiff failed to take a timely appeal of the order deeming his notice of dismissal withdrawn, and the order to stay and compel arbitration is an unappealable interlocutory order. View "Samake v. Thunder Lube, Inc." on Justia Law

The Second Circuit affirmed the district court's judgment in an action brought by the Fund against C&S Wholesale Grocers under the Employee Retirement Income Security Act (ERISA). The court held that the district court did not err in dismissing the Fund's evade-or-avoid liability theory; the district court did not err in dismissing the Fund's common control liability; the district court did not err in finding that C&S was not an employer of the Union employees at the Syracuse warehouse; and successor liability can, as a matter of law, apply to withdrawal liability under ERISA. However, in this case, the district court did not err in granting C&S's motion for summary judgment because C&S did not substantially continue Penn Traffic's relevant business, and therefore was not subject to successor liability. View "NY State Teamsters Conference Pension and Retirement Fund v. C&S Wholesale Grocers, Inc." on Justia Law

Plaintiff, a bridal designer and social media influencer, appealed the district court's preliminary injunction (PI), based in part on an employment agreement between plaintiff and JLM, ordering plaintiff not to compete with JLM through the end of her contractual term, enjoining her from using her name and its derivatives in trade or commerce, and granting JLM exclusive control over three disputed social media accounts for the duration of the litigation.The Second Circuit concluded that the district court did not abuse its discretion in entering the noncompete and name-rights prongs of the injunction, which properly flow from JLM's likely meritorious claims against plaintiff for breach of contract. The court also concluded that the district court did not err in rejecting plaintiff's contention that JLM breached the contract by refusing to pay her after she stopped working. However, the court concluded that the district court exceeded its discretion by transferring exclusive control over the disputed social media accounts to JLM while explicitly declining to assess whether JLM would likely succeed on its claim that it owned the accounts. Accordingly, the court affirmed in part, vacated in part, and remanded for further proceedings. View "JLM Couture, Inc. v. Gutman" on Justia Law

The Second Circuit affirmed the district court's judgment convicting defendant, known as "El Chapo," of conducting a continuing criminal enterprise (CCE), drug trafficking conspiracies, unlawful use of a firearm, and a money laundering conspiracy. Defendant is the former leader of a Mexican drug trafficking organization known as the Sinaloa Cartel.The court concluded that because defendant lacks standing to challenge his trial on the basis of the extradition treaty, his specialty claim was properly rejected; defendant's Fifth and Sixth Amendment rights to present a defense and to have the effective assistance of counsel were not unconstitutionally restricted; defendant's motion to dismiss Violation 27, one of the offenses within the CCE offense charged in Count I, was properly denied; the district court properly denied defendant's motion to suppress; claims of evidentiary errors lacked merit; there was no per se conflict of interest regarding defendant's counsel; defendant was not deprived of a complete defense in violation of his Fifth and Sixth Amendment rights; the jury instruction on unanimity was entirely correct; the district court did not exceed its discretion in denying defendant an evidentiary hearing or a new trial, and neither is warranted now; and the district court and the government did not engage in improper ex parte communications. View "United States v. Beltran-Leyva (Guzman Loera)" on Justia Law

Class members are Medicare Part A beneficiaries who are formally admitted to a hospital as "inpatients" before their subsequent reclassification as outpatients receiving "observation services." Plaintiffs filed suit alleging that the Secretary violated their due process rights by declining to provide them with an administrative review process for the reclassification decision. The district court entered an injunction ordering the creation of such a process.The Second Circuit affirmed, concluding that the named plaintiff had standing by demonstrating that they suffered a financial injury as a result of being reclassified as receiving observations services; the failure of the Secretary to provide an appeals process for the reclassification decision implicates the same set of concerns—namely, a loss of Part A coverage—for both the named plaintiffs and the absent class members; and the litigation incentives are sufficiently aligned so that the named plaintiffs can properly assert claims on behalf of those class members who will be hospitalized in the future. The court also concluded that the district court properly certified the plaintiff class and that the class satisfies the commonality and typicality requirements. Furthermore, the plaintiff class was properly certified under Federal Rule of Civil Procedure 23(b)(2).The court concluded that the district court did not clearly err by finding that plaintiffs' due process rights are violated by the current administrative procedures available to Medicare beneficiaries. In this case, plaintiffs have demonstrated that the Secretary violates their due process rights when utilization review committees reclassify them from inpatients to those receiving observation services without providing a mechanism to appeal that decision. View "Barrows v. Becerra" on Justia Law

Plaintiff filed suit against a detective with the Nassau County Police Department for false arrest under 42 U.S.C. 1983 and New York state law. Plaintiff also filed suit against Nassau County under the theory of respondeat superior. The district court vacated the jury's verdict in favor of plaintiff and dismissed the claims against both defendants.The Second Circuit affirmed the district court's dismissal of the claims against the detective where the detective's actions, though wrong, were not so wrong that no reasonable officer could have determined that the challenged action was lawful. Therefore, the detective is entitled to qualified immunity in regard to the section 1983 claim. In regard to the New York state law claim, the court concluded that the record could only support a finding of callousness or indifference in making the arrest, and such a finding does not preclude the legal conclusion that the detective acted in subjective good faith.However, the court reversed the district court's dismissal of the claims against the County because the County remains vicariously liable under New York law for the compensatory damages because (1) municipalities are not entitled to qualified immunity, (2) municipal employers may be vicariously liable on state law claims brought against their police officer employees, (3) a principal remains liable for damages caused by its agent, even when that agent is individually immune, and (4) the detective was acting within the scope of his employment when he arrested plaintiff. The court explained that, even if the detective is shielded from personally paying for the damages he caused by falsely arresting plaintiff, the County remains liable for those damages under New York state law. The court remanded for entry of judgment in plaintiff's favor against the County in the amount of $150,000 and for such other proceedings as may be appropriate. View "Triolo v. Nassau County" on Justia Law

Plaintiffs, former IBM employees who entered into severance agreements in which they agreed not to join any collective actions against IBM, filed suit challenging the validity of those collective-action waivers, alleging claims under the Age Discrimination in Employment Act of 1967 (ADEA). The district court granted IBM's motion to dismiss for failure to state a claim. In 14 Penn Plaza LLC v. Pyett, 556 U.S. 247 (2009), the Supreme Court held that section 626(f)(1) of the ADEA applied to substantive rights, like the statutory right to be free from workplace age discrimination, but not procedural ones, like the right to seek relief from a court in the first instance.The Second Circuit concluded that collective-action waivers, like arbitration clauses, address procedural, not substantive rights, and thus do not require special disclosures under section 626(f)(1) of the ADEA for their acceptance to be knowing and voluntary. Therefore, the district court correctly held that 14 Penn Plaza governs this case and granted IBM's motion to dismiss. View "Estle v. International Business Machines Corp." on Justia Law

The Second Circuit vacated the district court's dismissal of plaintiff's amended complaint against McKinsey and others under the Racketeer Influenced and Corrupt Organizations Act (RICO). The complaint alleged that McKinsey filed false and misleading disclosure statements in the bankruptcy court to obtain lucrative consulting appointments and that, as a result, AlixPartners LLP lost business and profits it otherwise would have secured. The court concluded that the amended complaint plausibly alleges proximate cause with respect to all 13 bankruptcies in which McKinsey filed false statements as well as the pay-to-play scheme. Accordingly, the court remanded for further proceedings. View "Alix v. McKinsey & Co., Inc." on Justia Law

The Second Circuit reversed the district court's dismissal of plaintiff's claims under the Real Estate Settlement Procedures Act (RESPA), alleging that Ocwen's failure to record her mortgage instruments and its actions in losing key mortgage documents constituted covered errors under the catch-all provision of Regulation X (RESPA's implementing regulation). In this case, plaintiff alleged that the errors committed by Ocwen in handling her loan modification documents were errors relating to servicing of a mortgage loan, and, consequently, were subject to the provisions of RESPA and Regulation X. The court concluded that plaintiffs' asserted errors are covered by the catch-all provision of Regulation X, which includes the terms "any other errors" and "relating to." Accordingly, the court remanded for further proceedings. View "Naimoli v. Ocwen Loan Servicing, LLC" on Justia Law