Justia U.S. 3rd Circuit Court of Appeals Opinion Summaries

Steven Newkirk was investigated for drug-related activities, leading law enforcement to obtain a warrant to search his apartment. During the search, officers found a loaded, stolen firearm, ammunition, drug paraphernalia, heroin, and significant amounts of marijuana. Newkirk, a convicted felon with a history of drug-distribution offenses, was initially detained by New Jersey authorities and later charged federally with being a felon in possession of a firearm. He spent approximately two weeks in state custody, then was released on bond with conditions that were gradually relaxed over several years. During his pretrial release, Newkirk had repeated violations, including multiple positive drug tests. Despite these issues, Newkirk engaged in community work, notably founding a nonprofit aimed at reducing gang violence.The United States District Court for the District of New Jersey presided over Newkirk’s guilty plea to the firearm charge. At sentencing, the advisory Sentencing Guidelines range was 92 to 115 months' imprisonment. Newkirk requested probation or, alternatively, a significantly reduced sentence. The District Court, highlighting his community service and personal development, sentenced him to time served—approximately two weeks. The Government objected, arguing the sentence was unreasonably low, and appealed.The United States Court of Appeals for the Third Circuit reviewed the case. It found that the District Court’s sentence was both procedurally and substantively unreasonable. Procedurally, the sentencing court failed to sufficiently address the risk of unwarranted sentencing disparities and the need for general deterrence, and did not adequately justify the extraordinary downward variance. Substantively, the court held that no reasonable sentencing court would have imposed such a short sentence given the offense and Newkirk’s history. The Third Circuit vacated the sentence and remanded for resentencing, instructing the District Court to give serious consideration to a substantially longer sentence. View "USA v. Newkirk" on Justia Law

Corey Kendig was involved in a fatal altercation outside a Pennsylvania tavern in October 2020. After being confronted and physically attacked by Jeremy Jones and his friends, Kendig, while in a chokehold on the ground, discharged his firearm and fatally shot Jones. Kendig was immediately taken into custody, treated for his injuries, and subsequently charged by Trooper Nicholas Stolar with criminal homicide, aggravated assault, and recklessly endangering another person. At trial, Kendig was acquitted of all charges by a jury.Following his acquittal, Kendig brought a civil action in the United States District Court for the Western District of Pennsylvania against Trooper Stolar and the Pennsylvania State Police, asserting claims under 42 U.S.C. § 1983 for false arrest, false imprisonment, and malicious prosecution, arguing that he was arrested and charged without probable cause in violation of his Fourth Amendment rights. The District Court granted summary judgment for Stolar, finding that Stolar was entitled to qualified immunity because he did not violate a clearly established constitutional right by omitting facts relevant to Kendig’s self-defense from the affidavit of probable cause.The United States Court of Appeals for the Third Circuit reviewed the case de novo. The court held that, while facts known to an officer supporting an affirmative defense like self-defense may be exculpatory and relevant to probable cause for certain offenses, the law was not clearly established at the time of Kendig’s arrest that an officer was constitutionally required to include such facts in a probable cause affidavit. Therefore, Stolar was entitled to qualified immunity. The Third Circuit affirmed the District Court’s order granting summary judgment in favor of Stolar. View "Kendig v. Stolar" on Justia Law

Aaron Lyons, after being caught with a gun at age eighteen on a Pittsburgh playground, pleaded guilty to possessing an offensive weapon under Pennsylvania law and was sentenced to probation. Following completion of his probation, he was again found with a firearm and subsequently pleaded guilty in federal court to being a felon in possession of a firearm. The court explained to Lyons that his prior conviction made it unlawful for him to possess a gun and that the federal offense carried significant penalties. At the time, prevailing case law did not require the government to prove that Lyons knew of his status as someone previously convicted of a crime punishable by more than one year.After Lyons’s federal conviction, the Supreme Court in Rehaif v. United States clarified that, for a conviction under the relevant statute, the government must prove the defendant knew of his felony status. Lyons filed a motion under 28 U.S.C. § 2255 in the U.S. District Court for the Western District of Pennsylvania, arguing his guilty plea was unknowing since he was not told of the knowledge-of-status element. The District Court dismissed the motion without an evidentiary hearing, ruling that Lyons had procedurally defaulted his claim by not raising it earlier, and that he failed to show actual innocence.The United States Court of Appeals for the Third Circuit reviewed the appeal and affirmed the District Court’s decision. The court held that Lyons’s Rehaif-based argument was not novel enough to excuse procedural default, as the underlying legal theory was reasonably available before Rehaif was decided. Furthermore, the appellate court found the record conclusively established that Lyons knew his status, making an evidentiary hearing unnecessary. The denial of the § 2255 motion was thus affirmed. View "USA v. Lyons" on Justia Law

Whittaker, Clark & Daniels, Inc. and three affiliates, historically involved in the manufacture and distribution of asbestos-containing talc, faced thousands of personal injury and environmental claims. Over the years, the companies divested their operating assets, notably selling them to Brenntag North America in 2004 while expressly excluding pre-sale asbestos and environmental liabilities. As liabilities mounted, one plaintiff obtained a large jury verdict in South Carolina and successfully moved to put Whittaker into receivership, with a receiver appointed to administer its assets.Following the South Carolina receivership, Whittaker's board authorized a Chapter 11 bankruptcy filing in the United States Bankruptcy Court for the District of New Jersey without consulting the receiver. The receiver moved to dismiss the bankruptcy, arguing that under the receivership order, only he had authority to file such a petition. The Bankruptcy Court denied the motion, finding that the receivership order did not displace the board’s authority. The United States District Court for the District of New Jersey affirmed this ruling. While bankruptcy proceedings moved forward, the Debtors negotiated a $535 million settlement with Brenntag to resolve successor liability claims. However, the Official Committee of Talc Claimants argued that certain product-line successor liability claims belonged exclusively to talc creditors and not to the bankruptcy estate.The United States Court of Appeals for the Third Circuit reviewed two central issues. First, it held that the propriety of Whittaker’s bankruptcy petition did not affect the bankruptcy court’s subject matter jurisdiction and that, under New Jersey law, the board retained authority to file for bankruptcy because the South Carolina receiver had not obtained recognition or ancillary receivership in New Jersey. Second, the court held that product-line successor liability claims, like other derivative claims based on injury to the debtor and available to all creditors, are property of the bankruptcy estate under 11 U.S.C. § 541(a)(1). Accordingly, the Third Circuit affirmed the lower courts’ judgments. View "In re: Whittaker Clark & Daniels" on Justia Law

In June 2019, a confrontation occurred between a Philadelphia Police Department officer and a civilian near a parade route. The officer told the civilian, who was walking her bike, she could not proceed in a certain direction. An altercation followed, during which the officer used a choke hold and both parties sustained minor injuries. The civilian requested medical assistance and the officer’s identification, after which the officer escalated the charges against her. Based on the officer’s account, a detective recommended multiple criminal charges, including aggravated assault. The civilian was detained overnight, but charges were later dismissed.At trial in the U.S. District Court for the Eastern District of Pennsylvania, the plaintiff brought federal and state claims against the involved officers. The jury found for the plaintiff on all counts, awarding $6,000 in compensatory damages and $1 million in punitive damages—split evenly between the two defendants. The District Court reduced the punitive damages to $250,000 for each defendant, otherwise denying post-trial motions, and awarded attorneys’ fees to the plaintiff.On appeal, the United States Court of Appeals for the Third Circuit reviewed the denial of the detective’s motion for judgment as a matter of law de novo. The Third Circuit held that the detective had probable cause to recommend charges based on the information he had at the time, entitling him to judgment as a matter of law on the false arrest, false imprisonment, and malicious prosecution claims. Regarding punitive damages, the court found the $250,000 award against the officer constitutionally excessive under Supreme Court due-process standards and reduced it to $12,000. The court reversed the judgment against the detective, vacated the judgment against the officer as to punitive damages, and remanded for proceedings consistent with its opinion, including reconsideration of attorneys’ fees. View "Wexler v. Hawkins" on Justia Law

The case involves a dispute between two biopharmaceutical companies over the distribution of a biosimilar drug following the expiration of a key patent. After Janssen’s patent for the composition of its biologic drug expired, Samsung sought to introduce its biosimilar product. Janssen and Samsung had previously settled related patent litigation through an agreement that granted Samsung a limited license to enter the market at a set date and restricted Samsung’s ability to sublicense, except to certain commercialization partners. Samsung subsequently entered into agreements with both Sandoz and Quallent, a subsidiary of the Cigna Group, allowing Quallent to distribute the biosimilar under its own label. Janssen argued that the sublicense to Quallent violated the settlement agreement and would cause it irreparable harm by altering market dynamics, reducing its market share and negotiation leverage, and sought a preliminary injunction to prevent Samsung from supplying Quallent during the litigation.The United States District Court for the District of New Jersey denied Janssen’s motion for a preliminary injunction. The court found that while Janssen was likely to succeed on the merits of its breach-of-contract claim, it had not demonstrated irreparable harm because any injury could be measured and compensated by monetary damages. The court credited Samsung’s expert's view that harm to Janssen would be quantifiable, did not find persuasive evidence of brand loyalty or reputational harm, and concluded that Janssen’s asserted loss of negotiation leverage was too speculative.On appeal, the United States Court of Appeals for the Third Circuit reviewed the District Court’s denial for abuse of discretion and affirmed. The Court held that loss of market share in a complex market does not categorically constitute irreparable harm in contract cases, and that mere difficulty in calculating damages does not meet the threshold for irreparable harm. The Court concluded that Janssen had not shown the requisite irreparable harm to justify preliminary injunctive relief. View "Johnson & Johnson v. Samsung Bioepis Co Ltd" on Justia Law

A non-profit organization that develops and sells technical standards for use in industry brought suit against a for-profit company that operates an online library of building codes. The for-profit company published on its website the full text of several copyrighted standards developed by the non-profit, which had been incorporated by reference into the International Building Code. This building code, in turn, was adopted as law by the City of Philadelphia and other jurisdictions. The for-profit company made these incorporated standards freely available, though it also sold premium subscriptions for enhanced features. The non-profit derived significant revenue from licensing and selling its standards, including those incorporated into law, and did not authorize the copying.The case was first heard in the U.S. District Court for the Eastern District of Pennsylvania. After limited discovery and a hearing, the District Court denied the non-profit’s motion for a preliminary injunction, concluding that the for-profit company was likely to succeed on its fair use defense. The District Court found that the company’s publication of the standards for the purpose of public access to the law was transformative, even though the use was commercial in part, and that the standards, as incorporated into law, were primarily factual in nature. The District Court also found that copying the entire standards was reasonable because the law incorporated those standards in full, and that the effect on the market for the standards was at best equivocal.On appeal, the United States Court of Appeals for the Third Circuit affirmed the District Court’s denial of the preliminary injunction. The Third Circuit held that the for-profit company is likely to succeed on the merits of its fair use defense, as three of the four statutory fair use factors favored fair use and the fourth was equivocal. The order denying the preliminary injunction was affirmed. View "American Society for Testing & Materials v. UPCODES Inc" on Justia Law

KalshiEX LLC operates a federally licensed designated contract market (DCM) that allows users to trade event contracts, including those based on sports outcomes. In late 2024, after Kalshi began offering sports-related event contracts similar to those offered by a competitor, New Jersey issued a cease-and-desist letter. The state asserted that Kalshi’s activities violated the New Jersey Constitution and state gambling laws, particularly regarding betting on collegiate sports, and threatened legal action with significant penalties if Kalshi continued its operations within New Jersey.In response, Kalshi initiated proceedings in the United States District Court for the District of New Jersey, seeking a preliminary injunction to prevent enforcement of New Jersey’s gambling laws against its federally regulated contracts. The District Court granted the injunction, finding that Kalshi had a reasonable likelihood of success on the merits, would suffer irreparable harm without relief, and that the public interest favored enjoining enforcement of potentially preempted state law. New Jersey appealed this decision.The United States Court of Appeals for the Third Circuit reviewed the District Court’s factual findings for clear error, legal conclusions de novo, and the decision to grant the preliminary injunction for abuse of discretion. The Third Circuit affirmed the District Court’s order. The appellate court held that the Commodity Exchange Act (CEA) grants the Commodity Futures Trading Commission (CFTC) exclusive jurisdiction over swaps, including sports-related event contracts traded on CFTC-licensed DCMs. Both field and conflict preemption principles bar New Jersey from enforcing its gambling laws against these contracts. The court concluded that Kalshi demonstrated a likelihood of success on the preemption claim, irreparable harm in the absence of an injunction, and that the equities and public interest favored injunctive relief. Accordingly, the court affirmed the preliminary injunction. View "Kalshiex LLC v. Flaherty" on Justia Law

Between April 2020 and September 2021, the defendant orchestrated a scheme to defraud federal relief programs, including the Paycheck Protection Program, Economic Injury Disaster Loan program, and Pandemic Unemployment Assistance program, leading to losses exceeding $2 million. He submitted multiple fraudulent loan applications using his own identity, corporate entities, his wife’s and neighbor’s information, and the personal information of at least thirteen other family members and associates. These individuals provided their details to facilitate the fraud and, upon receiving illicit funds, paid kickbacks to the defendant. The defendant’s wife was found to have gone beyond simply providing her information, including contacting a lender and fleeing with the defendant to avoid law enforcement. His neighbor also played a more active role and later pleaded guilty to wire fraud.The United States District Court for the Middle District of Pennsylvania accepted the defendant’s guilty plea to bank fraud, aggravated identity theft, and unlawful monetary transactions. At sentencing, the District Court applied a four-level enhancement under U.S.S.G. § 3B1.1(a), finding that the scheme was “otherwise extensive,” and included at least three “participants” (the defendant, his wife, and his neighbor), plus thirteen non-participants. The court overruled the defendant’s objections, adopted the Presentence Investigation Report, and imposed a 149-month sentence.On appeal, the United States Court of Appeals for the Third Circuit reviewed whether the District Court correctly applied the four-level enhancement, specifically whether the wife and neighbor qualified as “participants.” The appellate court held that the phrase “otherwise extensive” in the guideline is ambiguous, and that the District Court’s reliance on the commentary and prior precedent was ultimately appropriate. The Third Circuit found any legal error by the District Court was harmless and affirmed the sentence, holding that the enhancement was properly applied under the correct legal standard. View "USA v. Miller" on Justia Law

A Pennsylvania state prisoner with a history of opioid addiction participated in a prison Medication Assisted Treatment program, receiving Suboxone to help control his cravings. After prison officials twice accused him of possessing contraband and diverting his medication to other prisoners, he was removed from the treatment program. Instead of abruptly ending his medication, a prison doctor tapered his doses over a week to reduce withdrawal symptoms. The prisoner later suffered withdrawal effects and mental health challenges but was not reinstated in the program despite his requests. He claimed the diversion finding was unfair but did not allege personal animus or pretext by the officials involved.He filed a pro se lawsuit in the U.S. District Court for the Middle District of Pennsylvania against various prison officials and a doctor, alleging violations of the Eighth Amendment (cruel and unusual punishment), the Americans with Disabilities Act (ADA), and a state-law negligence claim. The District Court dismissed all claims, finding the federal claims inadequately pleaded and the state-law claim procedurally improper for lack of a certificate of merit under Pennsylvania law.The United States Court of Appeals for the Third Circuit reviewed the case de novo. The court affirmed the dismissal of the Eighth Amendment claim, holding that the complaint failed to allege deliberate indifference to medical needs as required by precedent; the officials’ actions were judged to be good-faith medical decisions, not constitutionally blameworthy conduct. The court also affirmed dismissal of the ADA claim, finding no plausible allegation that the prisoner was excluded from treatment “by reason of” his disability, but rather for diversion of medication. However, the court vacated the dismissal of the state-law negligence claim, as recent Supreme Court precedent abrogated the procedural requirement relied upon by the District Court, and remanded for further proceedings on that claim. View "DiFraia v. Ransom" on Justia Law