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

Gilliam was fatally shot outside a Pittsburgh bar in 1997. Grant was convicted on the testimony of one witness, who based his identification on clothing. The witness was apparently granted leniency with respect to a parole violation in exchange for testimony; the criminal history of the witness was not disclosed to or discovered by the defense. Others, who had been present and who stated that Grant was not the shooter, were not called as witnesses. There was no physical evidence tying Grant to the crime. The state court denied Grant’s petition for an evidentiary hearing on trial counsel’s ineffectiveness. The Pennsylvania Supreme Court affirmed, holding for the first time that claims of ineffective assistance of counsel should generally be raised in the first instance in post-conviction proceedings. Grant then filed an unsuccessful pro se petition under the Pennsylvania Post Conviction Relief Act, 42 Pa.C.S.A. 9541. The federal district court denied his habeas petition. The Third Circuit remanded, directing the court to grant a conditional writ of habeas corpus on the ineffective assistance claim.View "Grant v. Lockett" on Justia Law

Freeman worked at PPG until his firing in 2008; PGW subsequently assumed PPG’s liabilities. PPG maintains a 40 percent interest in PGW. After losing his job, Freeman, age 60, sued PGW under the Age Discrimination in Employment Act, 29 U.S.C. 621. The parties entered a binding arbitration agreement, listing three potential arbitrators. Lally-Green, a law school teacher, formerly a state judge, appeared at the top of both lists. Lally-Green acknowledged that she “knew some people at PPG” and had taught a seminar with a PPG attorney. The parties proceeded with Lally-Green as their arbitrator. The proceeding was fair and thorough. Lally-Green concluded that Freeman lost his job because he “had limited recent sales experience ... [and] received average performance ratings in a poorly performing region.” Three months later, Freeman moved to vacate the decision, claiming that Lally-Green had failed to disclose campaign contributions that she had received from PPG and its employees during her campaign for a seat on the state’s highest court. These contributions totaled $4,500. Lally-Green had raised $1.7 million during her unsuccessful campaign. The district court denied the motion. The Third Circuit affirmed, noting that the law firm representing Freeman had contributed $26,000 to Lally-Green’s campaign. View "Freeman v. Pittsburgh Glass Works, LLC" on Justia Law

The Federal Trade Commission secured a judgment of $10,204,445 against Sussman and his co-defendants and equitable relief, based on abusive debt collection activities. Sussman subsequently entered a safe deposit box and removed coins that had been “frozen” in connection with the earlier action; he was then convicted of theft of government property, 18 U.S.C. 641, and obstruction of justice, 18 U.S.C. 1503(a) and sentenced to 41 months on each count, to be served concurrently, followed by three years of supervised release. The court also imposed a $15,000 fine and a $200 special assessment. The Third Circuit affirmed, rejecting a challenge to the sufficiency of the evidence and a clam that Sussman should be afforded a new trial because a portion of the trial transcript is unavailable, apparently because a court reporter lost the transcript. The court upheld the admission into evidence of redacted documents from the FTC’s prior civil case and jury instructions on the elements of obstruction of justice and Sussman’s theory of defense. View "United States v. Sussman" on Justia Law

HRRG is in the business of acquiring or collecting debts under the FDCPAs definition of a “debt collector,” 15 U.S.C. 1692a(6), and sent Caprio a double-sided “Collection Letter.” Caprio filed a putative class action, alleging two claims under the Fair Debt Collection Practices Act, claiming that the letter’s instructions would confuse “the least sophisticated consumer” about how to dispute the alleged debt. The district court granted Caprio judgment on the pleadings. The Third Circuit vacated and remanded, concluding that the collection letter was deceptive because it can be reasonably read to have two or more different meanings, one of which is inaccurate. View "Caprio v. Healthcare Revenue Recovery Grp., LLC" on Justia Law

Crispin worked as a CPA and as CFO of an energy company; his wholly-owned S-corporation has engaged in leasing, structured finance, aircraft acquisition, and mortgage-backed securities investing for more than 20 years. The business purchases aircraft costing $1 million to $10 million and leases them for 10 years before reselling. A Custom Adjustable Rate Debt Structure (CARDS) transaction is a tax-avoidance scheme that purports to generate large “paper” losses deductible from ordinary income. In 2000 the IRS warned against taking tax deductions based on artificial losses generated by inflated bases in certain assets. After the IRS discovered the widespread use of CARDS, before Crispin filed the contested return, the IRS issued another Notice addressed to CARDS transactions and imposed disclosure obligations on CARDS promoters and users. Crispin used a CARDS transaction, involving aircraft financing, to shelter $7 million of income for the 2001 tax year. The tax court held that he was not entitled to an ordinary loss deduction and was liable for an accuracy-related penalty (26 U.S.C. 6662), finding that the transaction lacked economic substance and that he had not relied reasonably or in good faith on the advice of an independent and qualified tax professional. The Third Circuit affirmed. View "Crispin v. Comm'r of Internal Revenue" on Justia Law

Defendants are MB, a registered investment adviser, and people affiliated with MB. A fraudulent scheme was perpetrated by Bloom while he was an employee and officer of MB, through a hedge fund called North Hills that Bloom controlled and managed outside the scope of his responsibilities at MB. Bloom was arrested and indicted in New York in 2009 on charges relating to the Ponzi scheme, by which time most of the money invested in North Hills was gone. Investors filed suit, alleging: controlling person liability under Section 20(a) of the Securities and Exchange Act; negligent supervision; violations of Securities and Exchange Commission Rule 10b-5; violations of the Pennsylvania Unfair Trade Practice and Consumer Protection Law; and breach of fiduciary duty. The district court rejected all claims. The Third Circuit vacated and remanded with respect to MB on the claims for violations of Rule 10b-5 and the state UTPCPL, and otherwise affirmed. View "Belmont v. MB Inv. Partners, Inc." on Justia Law

Knoll filed suit following her termination from the city Parks Department, alleging gender discrimination, harassment, and retaliation in violation of Title VII of the Civil Rights Act, 42 U.S.C. 2000, and the Pennsylvania Human Relations Act, 43 Pa. Cons. Stat. 951. The district court dismissed the gender discrimination claim; the jury returned a verdict in favor of Allentown on the harassment and retaliation claims. Following Knoll’s unsuccessful motions for a new trial and for sanctions, the court concluded that the motions were frivolous but declined to order sanctions. The Third Circuit affirmed, holding that the court was not required to engage in a six-factor analysis before dismissal of a post-trial motion, based on procedural noncompliance. View "Knoll v. City of Allentown" on Justia Law

Burton founded and ran companies that manufactured and distributed medical device parts. By 2006, the companies employed approximately 140 people and generated annual revenue of $14 million. In 2007, Burton sold to Teleflex and entered into a two-year employment agreement with Teleflex, providing that she could terminate her employment by providing 30 days’ written notice. Teleflex could fire Burton without cause by providing 30 days’ written notice or could fire Burton for cause, upon written notice and an opportunity to cure. Burton, then age 67, became Vice President of New Business Development, supervised by Boarini. The two had a strained relationship. During an argument, Burton asked Boarini whether he wanted her to resign. There is evidence that she stated that she was resigning, stayed out of the office for two days, then left on a previously-scheduled vacation, after which SMD “accepted” her resignation in writing. The district court granted Telefex summary judgment on claims under the Age Discrimination in Employment Act, 29 U.S.C. 621; Title VII of the Civil Rights Act, 42 U.S.C. 2000e; and state law. The Third Circuit reversed, finding genuine issues of fact on whether Burton resigned. View "Burton v. Teleflex Inc." on Justia Law

Antitrust class actions alleged that defendants conspired to set a price floor for baby products. The court initially approved a settlement. Notice was sent to putative class members informing them of their right to submit a claim, opt out, or object. The deadline for submitting claims expired; the court approved the settlement and an allocation plan. Defendants deposited $35,500,000 into a settlement fund. After payment of attorneys’ fees and expenses, the remainder was slated for distribution to the settlement class. Claimants are entitled to different levels of compensation. The remainder would go to charitable organizations proposed by the parties and selected by the court. The Third Circuit vacated, stating that cy pres distributions are permissible, but inferior to direct distributions to the class, because they only imperfectly serve the purpose of compensating class members. The district court did not adequately consider that about $14,000,000 will go to class counsel, roughly $3,000,000 will be distributed to class members, and the rest, approximately $18,500,000 less administrative expenses, will be distributed to cy pres recipients. The court also needs to consider the level of direct benefit to the class in calculating attorneys’ fees. View "In re: Baby Products Antitrust Litig." on Justia Law

Araujo, who worked for New Jersey Transit Rail Operations, witnessed a fatal accident in 2008, when a construction worker was electrocuted on the job. He reported an emotional injury and was later suspended for violation of a rule relating to the accident. He filed a complaint with the Occupational Safety & Health Administration Office of Whistleblower Protection, which issued findings in favor of Araujo, and ordered NJT to pay $569,587 in damages, to which NJT objected. Araujo then filed suit, alleging that he was disciplined in retaliation for his participation in an activity protected by the Federal Rail Safety Act, 49 U.S.C. 20109, in reporting his injury. The district court found that the discipline was not retaliatory and granted NJT summary judgment. The Third Circuit reversed, holding that NJT failed to refute Araujo’s assertion that his actions were in line with NJT practice at the time of the accident. View "Araujo v. NJ Transit Rail Operations, Inc." on Justia Law