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

The U.S. Department of Health and Human Services approved a 2008 amendment to Pennsylvania’s state plan for administering its Medicaid program. Private nursing facilities that provide services to Medicaid recipients challenged the amendment as violating Title XIX of the Social Security Act, 42 U.S.C. 1396, by adjusting Pennsylvania’s method for determining Medicaid reimbursement rates to private nursing facilities for the 2008-09 fiscal year without considering quality of care, which they claim violates 42 U.S.C. 1396a(a)(30)(A) and without satisfying the public process requirements of 42 U.S.C. 1396a(a)(13)(A). The district court rejected the claims on summary judgment. The Third Circuit affirmed in part, finding the state immune from the requested relief under the Eleventh Amendment. The district court erred in granting summary judgment to the federal defendants. By approving the amendment without any assurance that the amended plan would produce payments that are consistent with quality of care, HHS acted arbitrarily. View "Christ the King Manor, Inc. v. Sec'y, U.S. Dep't of Health & Human Servs." on Justia Law

Club security flagged down officers and explained that Joseph had tried to “pass” counterfeit $100 bills. The officer did not inspect the bills but asked Joseph for identification and whether he tendered them at the bar. Joseph acknowledged that he tendered the bills and explained that he had obtained them when he cashed his pay check at a racetrack. Shining his flashlight on one of the bills, an officer saw a discrepancy in the bill’s security features: the president’s face in the bill’s watermark did not match the face printed on the bill. Joseph was arrested and searched at the scene. Officers found 14 more counterfeit $100 bills in Joseph’s pocket. After waiving his Miranda rights, Joseph provided a Secret Service agent with several incriminating text messages from his cell phone and confessed to attempting to pass the counterfeit bills. Indicted under 18 U.S.C. 472, Joseph unsuccessfully moved to suppress the bills, the text messages, and his confession. The Third Circuit rejected an appeal of his conviction, finding that Joseph had not preserved his argument that probable cause to arrest was absent because the officers had insufficient evidence to establish his intent to defraud at the time he passed and possessed the counterfeit bills. View "United States v. Joseph" on Justia Law

Elonis’s wife left their home with their children. Elonis began experiencing trouble at work at an amusement park, reportedly leaving early and crying at his desk. An employee Elonis supervised, Morrissey, claimed sexual harassment. In October Elonis posted on Facebook a photograph taken for his employer’s Halloween Haunt. The photograph showed Elonis in costume holding a knife to Morrissey’s neck. Elonis added the caption “I wish.” Elonis’s supervisor saw the posting and fired Elonis. Days later, Elonis began posting statements on Facebook about having “keys for the fucking gates … sinister plans for all my friends,” and, concerning his wife, “would have smothered your ass … dumped your body … and made it look like a rape and murder” that their son “should dress up as matricide for Halloween … head on a stick” and “I’m not going to rest until your body is a mess, soaked in blood and dying from all the little cuts.” Following issuance of a state court protective order, Elonis posted statements concerning shooting at his wife’s house, using explosives, and “I’m checking out and making a name for myself … hell hath no fury like a crazy man in a kindergarten class.” After being visited by federal agents, he posted statements about blowing up SWAT members. Elonis was convicted of transmitting in interstate commerce communications containing a threat to injure the person of another, 18 U.S.C. 875(c). The Third Circuit affirmed, rejecting an argument that he did not subjectively intend his Facebook posts to be threatening. A 2003 Supreme Court decision, Virginia v. Black, did not overturn its prior holding that a statement is a true threat when a reasonable speaker would foresee the statement would be interpreted as a threat. View "United States v. Elonis" on Justia Law

The U.S. Coast Guard had received information from the U.S. DEA, which learned from British Virgin Island law enforcement, which learned from Grenadian law enforcement, that the U.S.-registered vessel“Laurel” might be smuggling illegal narcotics. The Laurel, under the command Benoit, who has dual citizenship with the U.S. and Grenada, was intercepted in international waters. Coast Guard officers conducted a routine safety inspection, which the Laurel passed. They unsuccessfully attempted to conduct an at-sea space accountability inspection; rough waters made areas of the vessel inaccessible. Officer Riemer questioned Benoit and his crew, Williams, about their destination and purpose. Benoit gave inconsistent answers. Riemer conducted ION scan swipes; none came back positive for any explosive, contraband, or narcotics. The Laurel was directed to a U.S. port, where a canine boarded and alerted to narcotics. Still unable to access the entire vessel, officers directed Benoit to sail the Laurel to St. Thomas to enable a Vehicle and Container Inspection System (VACIS) search for anomalies in the vessel, which revealed anomalous masses. A Customs officer drilled a hole and found a substance that field-tested as cocaine. Officers cut a larger hole, revealing an area filled with brick-like packages. Laboratory tests revealed the bricks were cocaine hydrochloride with a net weight of 250.9 kilograms. After denial of two motions to suppress, Benoit and Williams were convicted of conspiracy to possess with intent to distribute five kilograms or more of cocaine while on a vessel subject to U.S. jurisdiction (46 U.S.C. 70503(a)(1), 70506(a), 70506(b); 21 U.S.C. § 841(a)(1), 841(b)(1)(A)(ii)); aiding and abetting possession with intent to distribute five kilograms or more of cocaine while on a vessel subject to U.S. jurisdiction; and attempted importation of cocaine. The Third Circuit affirmed. View "United States v. Benoit" on Justia Law

Seeking to address illegal sports wagering and to improve its economy, New Jersey sought to license gambling on rofessional and amateur sporting events. Sports leagues sought to block those efforts, claiming, with the United States intervening, that the proposed law violates the Professional and Amateur Sports Protection Act of 1992 (PASPA), 28 U.S.C. 3701, which prohibits most states from licensing sports gambling. New Jersey argued that the leagues lacked standing because they suffer no injury from legalization of wagering on their games and that PASPA was beyond Congress’ Commerce Clause powers. The state claimed that PASPA violates principles under the system of dual state and federal sovereignty: the “anti-commandeering” doctrine, on the ground that PASPA impermissibly prohibits states from enacting legislation to license sports gambling; and the “equal sovereignty” principle, in that PASPA permits Nevada to license sports gambling while banning other states from doing so. The district court enjoined New Jersey from licensing sports betting. The Third Circuit affirmed, holding that the leagues have Article III standing to enforce PASPA and that PASPA is constitutional. The court noted that accepting New Jersey’s arguments would require extraordinary steps, including invalidating a law under the anti-commandeering principle (the Supreme Court has only twice done so) and expanding that principle to suspend commonplace operations of the Supremacy Clause over state activity contrary to federal laws. View "Nat'l Collegiate Athletic Ass'n v. Governor of NJ" on Justia Law

Mortgage-backed securities, known as the MASTR Pass-Through Certificates, Series 2007-3, were offered to the public in 2007. UBS, the sponsor of the Certificates, purchased the underlying loans from originators, including Countrywide Home Loans and IndyMac Bank, then sold the loans to MASTR, which placed the loans into the MASTR Adjustable Rate Mortgages Trust, the issuer of the Certificates. UBS Securities, the underwriter, sold the Certificates to investors. The Certificates were issued pursuant to a Securities and Exchange Commission (SEC) Form S-3 Registration Statement filed in 2005 and an SEC Form 424B5 Prospectus Supplement filed in 2007. Those documents assured investors that the underlying loans were originated pursuant to particular underwriting policies and in compliance with federal and state laws and regulations. The district court dismissed a purported class action by investors, alleging violations of the Securities Act of 1933, 15 U.S.C. 77, for failure to plead compliance with the one-year statute of limitations and dismissed an amended complaint as untimely under an inquiry notice standard. The Third Circuit affirmed, holding that a Securities Act plaintiff need not plead compliance with Section 13 and that Section 13 establishes a discovery standard for evaluating the timeliness of Securities Act claims, but the claims were, nonetheless, untimely. View "Pension Trust Fund for Operating Eng'rs v. Mortg. Asset Securitization Transactions, Inc." on Justia Law

The Millers retained Ettinger in 2008 to represent them in a landlord/tenant dispute. Over 23 months, Ettinger billed $43,000. The dispute settled for $9,500. The Millers paid Ettinger $20,000, but even before the landlord-tenant matter settled, Ettinger sought relief in Pennsylvania state court to accelerate the speed at which he was paid. He petitioned to withdraw as a counsel, first based on alleged failure to pay and then due to professed “lack of cooperation.” Both petitions were rejected, though the Millers were ordered to make “good faith” payments. Despite their continued payments, Ettinger sued the Millers, who filed for Chapter 7 bankruptcy protection the following month. Ettinger filed an adversary proceeding in the Bankruptcy Court to prevent discharge of the Millers’ remaining debt to him, alleging fraud. The Bankruptcy Court rejected the complaint and imposed a $20,000 sanction against Ettinger jointly with his attorney. The district court vacated on the ground that the sanctions violated the “safe harbor” requirements of Fed. R. Bankr. P. 9011, which requires 21 days between serving and filing a sanctions motion, during which period the challenged conduct may be remedied, but refused to remand for further consideration. The Third Circuit remanded with instructions to permit the Bankruptcy Court to consider alternative avenues to impose sanctions. View "In re: Miller" on Justia Law

The Association of New Jersey Rifle and Pistol Clubs alleged that the Port Authority enforced state gun laws against its non-resident members at Newark Airport. The district court held that 18 U.S.C. 926A does not create a right enforceable under 42 U.S.C. 1983. The Third Circuit affirmed, holding that, in enacting the amended section 926A, Congress did not intend to confer the right upon the plaintiff. Section 926A confers protection upon those who wish to engage in the interstate transportation of firearms: Notwithstanding any other … law … any person who is not otherwise prohibited by this chapter from transporting, shipping, or receiving a firearm shall be entitled to transport a firearm for any lawful purpose from any place where he may lawfully possess and carry such firearm to any other place where he may lawfully possess and carry such firearm if, during such transportation the firearm is unloaded, and neither the firearm nor any ammunition being transported is readily accessible or is directly accessible from the passenger compartment of such transporting vehicle…. The court concluded that Congress did not intend the amended section 926A to benefit those who wish to transport firearms outside of vehicles. View "Ass'n of NJ Rifle & Pistol Clubs, Inc. v.Port Auth. of NY & NJ " on Justia Law

Carter pled guilty to conspiracy to use and produce counterfeit credit cards and armed robbery, resulting in a U.S.S.G. range of 121 to 130 months’ imprisonment. The district court sentenced Carter to 45 months’ imprisonment followed by three years’ supervised release, which began in November 2009. In June 2010, based on allegations of sexual conduct toward the 13-year-old daughter of Carter’s girlfriend, Carter pled guilty in state court to misdemeanors and was sentenced to five years’ probation. In October 2011, Carter was arrested for attempting to use stolen credit cards. He pled guilty to access device fraud and was sentenced to 9 to 23 months’ imprisonment. In revoking Carter’s supervised release, the court calculated the applicable range, U.S.S.G. 7B1.4 (2011), categorizing the credit card fraud as a Grade B violation, and, over Carter’s objection that he never touched the girl, found that Carter’s conduct amounted to a forcible sexual offense, a “crime of violence” and a Grade A violation of supervised release. The court sentenced him to 37 months’ imprisonment, four months above the Guidelines range, to run consecutively to any state sentence, stating that it would have imposed the same sentence regardless whether the sexual assault was a Grade A or B violation. The Third Circuit affirmed. Regardless of the charge, a court may consider a defendant’s actual conduct in concluding that he has violated the terms of supervised release. The court should have set out Carter’s specific crime of violence, but, because it provided an alternate basis for Carter’s sentence, any error was harmless. View "United States v. Carter" on Justia Law

Jang, a doctor and inventor, sued BSC, the company to which Jang assigned his coronary stent patents, for breach of the patent assignment agreement, which required BSC to share profits from the patents with Jang, including any damages it recovers from third-party infringers. In 2010, BSC settled a claim against Cordis for infringement in combination with anther claim that Cordis had against BSC. BSC made a payment to Cordis, and the parties exchanged several patent licenses. BSC then denied that it had recovered any damages that it was obligated to share with Jang. The Third Circuit reversed judgment on the pleadings in favor of BSC. Two of Jang’s claims are sufficient to survive judgment on the pleadings: that BSC breached the contract because the cash offset qualifies as a “recovery of damages” and that BSC violated the implied covenant of good faith and fair dealing by structuring a settlement to thwart the agreed purpose of the patent assignment. View "Jang v. Boston Scientific SciMed Inc." on Justia Law