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

Raymond and Sandra have lived in their Ambler, Pennsylvania home since 1993. They took on a mortgage from AmeriChoice. They fell behind on their payments. In 2012, AmeriChoice filed a foreclosure action; AmeriChoice obtained a default judgment. AmeriChoice scheduled a sheriff’s sale. The day before that sale, Raymond, acting alone, filed a Chapter 13 bankruptcy petition, triggering the automatic stay and preventing the sale. The case was dismissed six months later after Raymond failed to make payments. AmeriChoice rescheduled the sale. On the rescheduled date, Raymond filed a second Chapter 13 petition. The Bankruptcy Court granted relief from the stay. On the second rescheduled date, Sandra filed her Chapter 13 petition. Days later the court dismissed Sandra’s petition for failure to obtain prepetition credit counseling. In Raymond’s second case, AmeriChoice moved (11 U.S.C. 1307(c)) to either convert Raymond’s case to Chapter 7 or dismiss, arguing bad faith use of bankruptcy. Raymond unsuccessfully moved to postpone a hearing and the day before the hearing sought dismissal under section 1307(b). Raymond did not appear at the hearing. The court dismissed Raymond’s case, stating that he was “not permitted to file another bankruptcy case without express permission.” Sandra was subsequently enjoined from filing bankruptcy for 180 days. The Third Circuit vacated. While a bankruptcy court may issue a filing injunction while approving a section 1307(b) voluntary dismissal, the injunction against Raymond, beyond what had been requested, was not supported by reasoning. View "In re: Ross" on Justia Law

Gillette, an inmate at Golden Grove Correctional Facility on St. Croix, filed suit alleging various constitutional and statutory claims relating to his medical care and failure to protect. Gillette moved the district court to convene a three-judge court under the Prison Litigation Reform Act, 18 U.S.C. 3626. The court denied Gillette’s motion, finding that he had not satisfied the prerequisites for convening a three-judge court: the party seeking a prisoner release order must show that “a court has previously entered an order for less intrusive relief that has failed to remedy the deprivation of the Federal right sought to be remedied through the prisoner release order” and that “the defendant has had a reasonable amount of time to comply. Before the court could adjudicate the merits of Gillette’s claims, he filed an appeal. The Third Circuit dismissed for lack of jurisdiction. The order denying Gillette’s motion for a three-judge court is neither a final order nor subject to any exception to the final judgment rule, View "Gillette v. Prosper" on Justia Law

Officers executed sealed search warrants at the home and office of Fattah. More than two years later, a grand jury indicted Fattah on 23 counts relating to bank fraud and tax evasion. Before the indictment, the press learned about the investigation; reporters waited at Fattah’s home to report the story. At Fattah’s trial, an FBI agent admitted that he had disclosed confidential information to a reporter in exchange for information pertinent to the investigation. Fattah argued that the agent’s conduct violated the Sixth Amendment because the pre-indictment press caused him to lose his job, which rendered him unable to retain the counsel of his choice, and that the agent’s conduct violated his Fifth Amendment right to due process. The Third Circuit affirmed Fattah’s convictions, noting that Fattah’s claim to unrealized income was contradicted by his statements and actions and that the FBI agent’s actions were not “so outrageous that due process principles would absolutely bar the government from invoking judicial processes to obtain a conviction.” View "United States v. Fattah" on Justia Law

In multi-district litigation involving 315 product liability claims, plaintiffs alleged that Pfizer’s drug, Zoloft, a selective serotonin reuptake inhibitor (SSRI), caused cardiac birth defects. The Plaintiffs’ Steering Committee introduced several experts to establish causation. The testimony of each of these experts was excluded in whole or in part. In particular, Nicholas Jewell, Ph.D., a statistician, used the “Bradford Hill” criteria to analyze existing literature on the causal connection between Zoloft and birth defects. The district court conducted a Daubert hearing, excluded Jewell's testimony, and granted summary judgment to defendants, stating that Jewell: “failed to consistently apply the scientific methods he articulates, has deviated from or downplayed certain well-established principles of his field, and has inconsistently applied methods and standards to the data so as to support his a priori opinion.” The Third Circuit affirmed, holding that the district court did not require replication of significant results to establish reliability, but merely made a factual finding that teratologists generally require replication of significant results, and this factual finding did not prevent it from considering other evidence of reliability. View "In Re: Zoloft t (Sertraline Hydrochloride) Products Liability Litigation" on Justia Law

Debtors filed a voluntary Chapter 13 petition. The Bankruptcy Court confirmed a plan that required payments of $2,485 each month for 60 months. Later, because of an increase in mortgage payments, the plan was amended to increase the payments to $3,017 for the remainder of the 60-month period. Debtors made consistent payments and, after 60 months, had paid $174,104, slightly exceeding their projected plan base. The Trustee subsequently moved to dismiss the case under 11 U.S.C. 1307(c), alleging that Debtors still owed $1,123 to complete their plan base. Debtors cured the arrears within 16 days. The motion had been joined by an unsecured creditor, who claimed that the plan and the Code required completion within 60 months. The Bankruptcy Court agreed that the failure to completely fund the plan base within 60 months was a material default constituting cause for dismissal, but found that the default was not the result of Debtors' unreasonable delay, that Debtors promptly corrected the deficiency, and that the delay did not significantly alter the timing of distributions. The district court and Third Circuit affirmed and rejected an adversary proceeding, objecting to the discharge. Bankruptcy courts have discretion to grant a brief grace period and discharge debtors who cure an arrearage in their plan shortly after the expiration of the plan term. View "In re: Klaas" on Justia Law

A Harrisburg, Pennsylvania ordinance prohibits persons to “knowingly congregate, patrol, picket or demonstrate in a zone extending 20 feet from any portion of an entrance to, exit from, or driveway of a health care facility.” Individuals purporting to provide “sidewalk counseling” to those entering abortion clinics claimed that the ordinance violated their First Amendment rights to speak, exercise their religion, and assemble, and their due process and equal protection rights. The court determined that the ordinance was content-neutral because it did not define or regulate speech by subject-matter or purpose, so that intermediate scrutiny applied, and reasoned that it must accept as true (on a motion to dismiss) claims that the city did not consider less restrictive alternatives. The claims proceeded to discovery. In denying preliminary injunctive relief, the court ruled that plaintiffs did not demonstrate a likelihood of success on the merits. The Third Circuit vacated. In deciding whether to issue a preliminary injunction, plaintiffs normally bear the burden of demonstrating likelihood of prevailing on the merits. In First Amendment cases where the government bears the burden of proof on the ultimate question of a statute’s constitutionality, plaintiffs must be deemed likely to prevail for purposes of considering a preliminary injunction unless the government has shown that plaintiffs’ proposed less restrictive alternatives are less effective than the statute. View "Reilly v. City of Harrisburg" on Justia Law

Roquet, is a psychologist at the Avenel Special Treatment Unit (STU), where Oliver, a sexually violent predator, has been civilly committed for treatment. At least annually, the Treatment Progress Review Committee (TPRC) interviews each detainee and considers a range of materials to formulate a recommendation about whether the patient should progress to the next step in the program. Roquet, a member of the TPRC, wrote a report that recommended that Oliver not advance in treatment. The Report recognized that this was “not consistent” with Oliver’s treatment team's recommendation, but concluded that Oliver “had not fully met the treatment goals,” provided a detailed overview of Oliver’s sexual and non-sexual offenses, diagnostic history, and clinical treatment, and summarized the results of Oliver's interview, including that “it appears that he denies, minimizes or justifies much of his documented offense history,” and that “[h]e did not demonstrate remorse for his crimes or empathy for his victims.” Oliver sued, alleging retaliation for his First Amendment-protected participation in legal activities on behalf of himself and other STU residents. The Third Circuit concluded that Roquet was entitled to qualified immunity, reasoning that Oliver pleaded facts reflecting that Roquet based her recommendation on the medically-relevant collateral consequences of his protected activity, but has not sufficiently pleaded that the recommendation was based on the protected activity itself. View "Oliver v. Roquet" on Justia Law

Francis was identified by an eyewitness as the triggerman in a 2011 fatal shooting on St. Thomas. Francis admitted that he was present during the shooting and claimed Fahie wielded the weapon. Both Fahie and Francis were charged with the murder and related crimes. Francis worked out a plea deal: in exchange for reduced charges, he agreed to testify against Fahie, which he did, swearing that Fahie was the sole shooter. The jury found Fahie guilty. After an unsuccessful appeal to the Virgin Islands Supreme Court, Fahie successfully petitioned the Third Circuit certiorari. That court concluded that it had jurisdiction under the 2012 version of the Organic Act, 48 U.S.C. 1613; upheld the decision to give an “aiding and abetting” instruction, concluding that the theory was presented at trial; and declined to address whether the V.I. Supreme Court used the correct standard to assess whether another supposed error in the jury instructions was harmless. View "Fahie v. People of the Virgin Islands" on Justia Law

Third Circuit rejects "reverse" False Claims Act suit involving Small Business Administration.The SBA, a federal agency, provided $90 million to L Capital, a venture capital group, through the purchase of securities. L Capital invested $4 million in preferred shares of Simparel. The Certificate of Incorporation specified that Simparel must pay preferred shareholders accrued dividends if Simparel’s Board exercised its discretion to pay the dividends or if Simparel underwent liquidation, dissolution, or windup. The SBA was appointed as L Capital’s receiver after Simparel failed to comply with its funding agreement. Petras, Simparel’s Chief Financial Officer, claimed that this failure resulted in the SBA becoming a preferred shareholder, entitled to accrued dividends. The Simparel Board never declared dividends nor did Simparel undergo liquidation, dissolution, or windup. Petras claimed that the Simparel defendants engaged in fraudulent conduct—to which he objected—to avoid paying the contingent dividends: hiding Simparel’s deteriorating financial condition; failing to hold board meetings: and neglecting to send the SBA Simparel’s financial statements. The Third Circuit affirmed dismissal of the “reverse FCA” claim. The Simparel defendants could not have “knowingly and improperly avoid[ed] or decrease[d] an obligation” to pay the accrued dividends at the time of their alleged misconduct because the obligation did not yet exist. View "Petras v. Simparel, Inc." on Justia Law

Fair Labor Standards Act claims, not dependent on interpretation of collective bargaining agreement, need not be arbitrated, where arbitration clause does not include a clear waiver.Certified nursing assistants, sued their employer, Silver Care, for violations of the Fair Labor Standards Act (FLSA) and related New Jersey laws, claiming that Silver underpaid them for overtime by failing to include certain hourly wage differentials in the calculation of plaintiffs’ regular rate of pay, and by deducting plaintiffs’ half-hour meal breaks from their total hours worked, although they often worked through those breaks. Silver unsuccessfully moved to dismiss or to stay the proceedings, citing the arbitration clause in the governing collective bargaining agreement (CBA). The Third Circuit affirmed. A court may compel arbitration of a plaintiff’s federal statutory claim when the arbitration provision clearly and unmistakably waives the employee’s ability to vindicate that right in court and the federal statute does not exclude arbitration as an appropriate forum. If no clear or unmistakable waiver exists, arbitration may be compelled if the plaintiff’s FLSA claim “depends on the disputed interpretation of a CBA provision,” which must “first go to arbitration.” Silver did not dispute that the arbitration provision lacks a clear and unmistakable waiver. Neither of the FLSA claims depend on disputed interpretations of CBA provisions. View "Jones v. SCO Silver Care Operations LLC" on Justia Law