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

Barrett, a financial planner, induced the plaintiffs, small New Jersey corporations and their owners, to adopt an employee welfare benefit plan known as the Employers Participating Insurance Cooperative (EPIC). EPIC was promoted as a multiple employer welfare benefit plan for which contributions were deductible under 26 U.S.C. 419A(f)(6), but in fact was a method of deferring compensation. After the Internal Revenue Service audited the plans and disallowed deductions claimed on federal income tax returns, plaintiffs sued Barrett and other entities involved in the scheme, asserting claims under the Employee Retirement Income Security Act of 1974, 29 U.S.C. 1001-1461; the civil component of the Racketeer Influenced and Corrupt Organization Act, 18 U.S.C. 1961-1968; and New Jersey statutory and common law. A jury found Barrett liable of common law breach of fiduciary duty, but not liable on the RICO claim. The district court held a bench trial on the ERISA claim and issued partial judgment for plaintiffs. The Third Circuit affirmed in part, but vacated holdings that deemed certain state law causes of action preempted by ERISA, found certain ERISA claims time-barred, and limited the jury‘s consideration of one RICO theory of recovery. View "Cappello v. Iola" on Justia Law

Muhammud pleaded guilty to conspiracy to distribute controlled substances (21 U.S.C. 846); possession of a firearm in furtherance of drug trafficking (18 U.S.C. 924(c)); and possession of a firearm by a convicted felon (18 U.S.C. § 922(g)(1)) and waived his right to appeal or collaterally attack the conviction. He was sentenced to 90 months. He did not file a notice of appeal within 10 days of entry of the final judgment, as then required by Rule 4(b)(1)(A)(i), but about a year later filed a pro se motion under 28 U.S.C. 2255, asserting several bases of ineffective assistance of counsel. The district court enforced the waiver and dismissed the petition. Muhammud filed, pro se, a notice of appeal with respect to dismissal of the 2255 petition. The Third Circuit denied a certificate of appealability. More than two years after his sentencing, Muhammud filed a notice of appeal. The government, mistakenly believing that he was appealing denial of his 2255 petition, moved to enforce the waiver but failed to assert untimeliness of an appeal from conviction. The Third Circuit denied an appeal, holding that the government could initially raise untimeliness in its merits brief to the appeals court. View "United States v. Muhammed" on Justia Law

Michael filed a Chapter 13 voluntary petition and the Bankruptcy Court confirmed his reorganization plan, providing that Michael would pay $277 monthly to the trustee, for 53 months; the trustee would direct the monies to creditors, including GMAC, which held a mortgage on Michael‘s residence. Michael would make regular mortgage payments to GMAC outside of the Plan. To the extent funds were available, unsecured creditors would be paid pro rata. Michael’s wages were attached and paid directly to the trustee. Michael was unable to make mortgage payments outside of the Plan. The Bankruptcy Court granted GMAC relief from the automatic stay to allow foreclosure. Because Michael did not move to amend the Plan or modify the wage attachment, the trustee continued to receive payments. GMAC refused to accept payments to avoid an estoppel or waiver defense to its mortgage foreclosure. The funds accumulated until Michael converted his case to Chapter 7 and moved for return of the $9,181.62. The trustee objected, arguing that the funds should be distributed to unsecured creditors. The bankruptcy and district courts, noting that the Code does not clearly address the issue, concluded that the funds must be returned to Michael. The Third Circuit affirmed.View "In Re: Michael" on Justia Law

Kouevi lived in Togo. From 2001- 2005, Kouevi conspired to fraudulently obtain “diversity visas,” 8 U.S.C. 1153(c)), for at least 34 people through the American Embassy in Togo. The head of the scheme, Afolabi, paid fees for persons who were eligible for the diversity lottery and assisted them with their paperwork, requiring the applicants to falsely represent that others were their spouses or children, so that those individuals could obtain visas. Kouevi was responsible for false documents and tutoring participants to prepare them for Embassy interviews. Afolabi helped Kouevi fraudulently obtain his own visa and paid his costs to come to the U.S. The Department of Homeland Security arrested Afolabi for bringing young girls to the U.S. and forcing them to work at hair braiding salons, 16 hours a day, 6 to 7 days a week, for several years, without pay. They were also subjected to beatings and rape. Kouevi was convicted of conspiracy to commit visa fraud, 18 U.S.C. 371, and visa fraud, 18 U.S.C. 1546(a) and 2, and sentenced to 26 months imprisonment. The Third Circuit affirmed, rejecting an argument that his conduct was not criminalized by the part of the statute he was indicted under. View "United States v. Kouevi" on Justia Law

In 2002, Turlington pled guilty to conspiring to distribute more than 50 grams of cocaine base (21 U.S.C. 841(a)(1), 841(b)(1)(A), 846). In 2004, the district court sentenced him to 84 months’ imprisonment and 60 months’ supervised release, less than one-third of the Sentencing Guidelines’ recommendation. In October, 2008, Turlington began supervised release. In September 2009, he was charged with driving under the influence; in December, New Jersey police observed Turlington engaging in three hand-to-hand drug transactions. When they approached and announced themselves, Turlinton attempted to flee and threw a loaded handgun to the ground. Police searched Turlington and found $245 in cash and a plastic bag of cocaine. Turlington pleaded guilty to possessing a weapon while committing a controlled dangerous substance crime. The New Jersey Superior Court sentenced him to three years’ imprisonment, to run concurrently with any federal sentence. Turlington admitted to possessing the handgun and drugs; the district court revoked supervised release and sentenced him to 60 months. The Third Circuit affirmed. View "United States v. Turlington" on Justia Law

Giles was a prisoner in the Delaware penal system. Campbell worked at the Sussex Correctional Institution. Giles brought excessive force and deliberate indifference claims, 42 U.S.C. 1983, against officers, including Campbell, based on a confrontation during Giles’s transfer to Sussex and against others regarding his medical treatment after the incident. The district court granted summary judgment in favor of several defendants, including Campbell, on the basis of qualified immunity, held a bench trial, and entered judgment in favor of remaining defendants. The Third Circuit remanded the summary judgment. On remand, the Delaware Department of Justice, which had represented defendants, notified the court that Campbell had died in July 2006. Giles moved to substitute the administratrix of Campbell’s estate as a defendant. Neither the suggestion of death nor the motion to substitute was served on the estate. The district court denied the motion to substitute, holding that Giles’s claim was not pending under Delaware law and was extinguished. Giles proceeded to trial and the jury found in favor of the remaining defendants. The Third Circuit vacated denial of the motion to substitute, finding that the court lacked jurisdiction over the estate. View "Giles v. Campbell" on Justia Law

In 2003, D.K. began kindergarten; he struggled in school and had behavioral issues. In 2007, at the urging of a private therapist, his parents requested a second evaluation. Two months later, the district determined that D.K. was eligible for special education services as a student with “other health impairment,” and he was offered an Individualized Education Program. In 2008, while finalizing D.K.’s IEP, his parents requested a due process hearing under the Individuals with Disabilities Education Act, 20 U.S.C. 1400–1419, and requested an award of compensatory education for September 2004 through March 12, 2008. The district court affirmed the denial, holding that the IDEA’s statute of limitations, passed in 2004, barred relief for conduct prior to January 8, 2006, and that plaintiffs were ineligible for two statutory exceptions to the IDEA statute of limitations. The school district did not violate its obligation to identify students in need of special education and did not fail to provide D.K. a free appropriate public education before November 2007. The Third Circuit affirmed, noting that the district consistently monitored, documented, and responded to D.K.’s individual educational needs, developed behavioral improvement systems with his parents’ cooperation, and offered him special attention and testing accommodations. View "D. K. v. Abington Sch. Dist." on Justia Law

In 2005 Weatherspoon was charged with conspiring to distribute and possess with intent to distribute over 50 grams of cocaine base. In 2006 he pled guilty and was sentenced to 120 months, under a binding plea agreement. A few years later, the U.S. Sentencing Commission issued a retroactive amendment which reduced Weatherspoon's Guidelines range. In 2011, the Third Circuit rejected Weatherspoon's first motion for a sentence reduction because he was sentenced pursuant to a binding plea agreement. The district court denied a subsequent motion, based on an argument that he is nevertheless eligible for a reduction because under the Supreme Court‘s recent decision in Freeman v. United States, 131 S. Ct. 2685 (2011), the sentence contained in his plea agreement was based on‖ the Sentencing Guidelines. The Third Circuit affirmed. View "United States v. Weatherspoon" on Justia Law

Begin pled guilty on charges related to his use of the internet and a cellular phone to send sexual messages and photographs to a minor in order to persuade her to have sex with him and was sentenced to 240 months’ imprisonment, a 30-month upward departure from the top of his advisory Sentencing Guidelines range. Begin argued that his sentence was unreasonable based on the asserted disparity between his sentence for attempting to induce statutory rape and the lower maximum sentences for actually committing statutory rape under state and federal law. The Third Circuit vacated and remanded for consideration of that argument. The claim has colorable legal merit, so that, upon appropriate findings of fact, the district court would be within its discretion to accept the argument and to factor it into the ultimate sentence. View "United States v. Begin" on Justia Law

There are four direct purchasers of heavy duty truck transmissions in North America. Truck buyers dealing with those direct purchasers can select many of the components for their trucks, including transmissions, from catalogues called data books. Data book positioning is significant to likelihood that a buyer will choose a particular component. Eaton is a monopolist in the market for such transmissions. ZF-Meritor entered the market in 1989; otherwise no significant external supplier has entered the market in 20 years. ZF-Meritor sued Eaton, alleging anticompetitive practices embodied in long-term agreements between Eaton and every direct purchaser, including provisions relating to data books. A jury found Sherman Act and Clayton Act violations. The district court reasoned that notwithstanding Eaton‘s above-cost prices, there was sufficient evidence to establish long-term de facto exclusive dealing arrangements, which foreclosed a substantial share of the market and harmed competition. The Third Circuit affirmed. The claims are not subject to the price-cost test, but must be analyzed as de facto exclusive dealing claims under the rule of reason. There was sufficient evidence that Eaton engaged in anticompetitive conduct and of resulting antitrust injury. The court vacated an injunction, finding that plaintiffs lacked standing to pursue injunctive relief. View "ZF Meritor LLC v. Eaton Corp." on Justia Law