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

Jumper, a securities broker-dealer, arranged financing on behalf of private investors for the purchase of a Pennsylvania fire-brick manufacturer. Jumper fraudulently obtained authority to transfer the company’s pension plan assets by forging the majority stakeholder’s signature on several documents. Between 2007-2016, Jumper transferred $5.7 million from the pension plan to accounts he controlled.The SEC filed a civil complaint against Jumper for securities fraud in the Western District of Tennessee. The Department of Justice filed criminal charges against Jumper in the Middle District of Pennsylvania. The Tennessee court entered a default judgment for the SEC and ordered Jumper to disgorge $5.7 million and to pay prejudgment interest of $726,758.79. In Pennsylvania, Jumper pleaded guilty to wire fraud and agreed to make full restitution; the parties stipulated a loss of $1.5-$3.5 million.The district court considered Jumper’s request for a downward departure based on medical issues, discussed the relevant 18 U.S.C. 3553(a) factors, and denied Jumper’s requests, explaining, the Bureau of Prisons (BOP) is equipped to provide consistent, adequate medical care. The court sentenced Jumper to 78 months’ incarceration, at the bottom of the Guidelines range of 78–97 months, and ordered him to pay $2,426,550 in restitution. The Third Circuit affirmed, rejecting arguments that the sentence violated the Double Jeopardy Clause and principles of collateral estoppel and that the court improperly concluded that the BOP could treat his medical issues. View "United States v. Jumper" on Justia Law

In White Deer Township, a four-mile gap in Verizon’s wireless coverage overlays Interstate 80; Verizon customers are likely to experience “dropped calls,” “ineffective call attempts,” and “garbled audio.” The area is within Bald Eagle State Forest. A 2000 Pennsylvania moratorium prohibits the construction of cell towers on state forest land, so Verizon’s options were limited. After considering several sites and antenna configurations, Verizon decided to construct a 195-foot monopole topped with a four-foot antenna on privately owned land, comprising 1.9 acres and containing a cabin, shed, pavilion, and privy. Verizon leased 0.0597 acres, in the northeast corner of the property for the tower.The Township then permitted cell towers that complied with a minimum permissible lot size of one acre; cell towers had to be set back “from lot lines and structures a distance equal to the height of the facility, including towers and antennas, plus 10% of such height.” The Zoning Board denied Verizon’s variance applications, finding that Verizon’s alleged hardship was insufficient because it was “not a hardship connected to the capacity for the property to be used reasonably, but rather, the hardship [was connected to Verizon’s] capacity to use the property as desired.” The Third Circuit affirmed summary judgment for Verizon. The denial had “the effect of prohibiting the provision of personal wireless services,” in violation of the Telecommunications Act, 47 U.S.C. 332(c)(7)(B)(i)(II). View "Cellco Partnership v. White Deer Township Zoning Hearing Board" on Justia Law

In 2006, Mervilus, age 22, supported his mother, a cancer patient, and two younger siblings. Abreu accused Mervilus of robbing and stabbing him. Mervilus agreed to take a polygraph examination. Earlier that year, officers dismissed drug charges after a polygraph exam indicated he truthfully denied responsibility. New Jersey permitted polygraph results to be admitted at trial. The Union County Police Department’s only certified polygraph examiner, Kaminskas, conducted the exam. Kaminskas used the “Arther Method,” an “outlier in the polygraph world,” not accredited by the American Polygraph Association. The Method relies on subjective observations and assumptions, such as that certain ethnic groups do not experience any guilt when they lie. Kaminskas concluded Mervilus was deceptive. The only relevant question where Mervilus’s physiological responses signaled deception was a question for which Kaminskas insisted Mervilus change his answer. At trial Abreu failed to identify Mervilus, pointing to a different Black man. The court admitted the polygraph exam. Mervilus was convicted. In 2011, the conviction was overturned on the ground that Kaminskas’s testimony was improper and prejudicial.Mervilus sued Kaminskas, Chief Vaniska, and Union County, 42 U.S.C. 1983. The Third Circuit reversed the summary judgment rejection of those claims. Mervilus introduced sufficient evidence to try his fabrication-of-evidence claim against Kaminskas. His Monell claim against Union County is viable even if Kaminskas did not fabricate evidence; a jury might not render an inconsistent verdict if it found the County liable but Kaminskas not culpable. View "Mervilus v. Union County" on Justia Law

Imperial Sugar went bankrupt in 2001 and suffered a costly accident in 2008, prompting its sale to Louis Dreyfus. Imperial receives from Louis Dreyfus only minimal investment and is an “import-based, price-uncompetitive sugar refinery” that is “structurally uncompetitive” and lost roughly 10 percent of its customers from 2021-2022. Florida-based refiner U.S. Sugar agreed to purchase Imperial. The government sought an injunction (Clayton Act. 15 U.S.C. 18), arguing that the acquisition would have anticompetitive effects, leaving only two entities in control of 75% of refined sugar sales in the southeastern United States. The government applied the hypothetical monopolist test to demonstrate the validity of its proposed product and geographic markets. U.S. Sugar responded that it does not sell its own sugar but participates with other producers in a Capper-Volstead agricultural cooperative that markets and sells the firms’ output collectively but exercises no control over the quantities produced. At capacity, Imperial’s facility could produce only about seven percent of national output. U.S. Sugar argued that distributors constitute a crucial competitive check on producer-refiners that would undermine any attempt to increase prices and noted evidence of the high mobility of refined sugar throughout the country.The Third Circuit affirmed the denial of an injunction, upholding a finding that the government overlooked the pro-competitive effects of distributors in the market, erroneously lumped together heterogeneous wholesale customers, and defined the relevant geographic market without regard for the high mobility of sugar throughout the country. View "United States v. United States Sugar Corp." on Justia Law

Each of the four plaintiffs filed a putative class action complaint in state court, alleging violations of the Magnuson-Moss Warranty Act (MMWA), 15 U.S.C. 2301, claiming that the defendants either concealed written warranties prior to sale or provided warranties that prohibit the use of third-party repair services or parts in violation of MMWA. The defendants removed the actions to the U.S. District Court for the Western District of Pennsylvania pursuant to the Class Action Fairness Act (CAFA), 28 U.S.C. 1332(d)(2).The plaintiffs moved to remand to state court. The district court held that remand was appropriate because MMWA’s jurisdictional requirements were not satisfied and neither CAFA nor traditional diversity jurisdiction can be used to circumvent those jurisdictional requirements. The Third Circuit affirmed.MMWA claims can only be brought in federal court if section 2310(d)(3)’s requirements are satisfied, including that a class action name at least 100 plaintiffs; here, each complaint names only one plaintiff. MMWA’s stringent jurisdictional requirements are irreconcilable with CAFA. Allowing CAFA to govern MMWA class claims would undercut the MMWA’s requirement and allow an MMWA class action to proceed in contravention of the MMWA. View "Rowland v. Bissell Homecare, Inc." on Justia Law

Kapitus purchased receivables from Delloso's company, Greenville Concrete, for $909,775. In 2013, Kapitus sued for breach of contract. Greenville defaulted on a subsequent settlement. Kapitus obtained a state court judgment against Delloso and Greenville for $776,600.25. In 2016, Delloso filed a Chapter 7 voluntary bankruptcy petition in which he listed the $776,600.25 debt and disclosed that his sole employer was “Bari Concrete.” The Bankruptcy Court notified the creditors of the last day to oppose dischargeability; the trustee explained that because this was a “no-asset case,” creditors should not file proofs of claim unless it appeared that assets would be available. Kapitus did not file a proof of claim. None of Delloso’s creditors filed adversary complaints. The Bankruptcy Court granted Delloso’s discharge and, in August 2016, closed the case. In 2021, Kapitus moved to reopen the case, alleging that it learned that Bari used the same addresses previously associated with Greenville, was controlled by Delloso, and appeared to be "a mere continuation of Greenville.”The Bankruptcy Court declined to reopen Delloso’s case under 11 U.S.C. 523(a) or revoke the discharge under section 727(d)(1) as obtained through fraud. The Third Circuit affirmed. Any complaint to assert that the debt was not dischargeable was untimely and the time could not be extended by equitable tolling. Even if Kapitus’s allegations were true, it could obtain appropriate and sufficient relief by suing Delloso and Bari in state court, which Kapitus had already done. View "In re: Delloso" on Justia Law

U.S. Marshals in Harrisburg, Pennsylvania staked out Carey’s residence to arrest him for violating his conditions of supervised release. Carey placed a bag in the trunk of his car and began to pull away, hitting a parked car. Officers searched his car and found Carey’s open bag, containing a shoe box with a large opening. It contained $79,320. From Carey’s residence, his girlfriend, Slone, heard the commotion and flushed cocaine and PCP down the toilet. The government’s expert estimated that the bags together contained around 112 grams of cocaine. Slone indicated there was marijuana and a loaded firearm in the house. Police obtained a search warrant and recovered approximately five pounds of marijuana and 310 grams of cocaine, five cellular phones, a money counter, a loaded handgun [registered to Slone], ammunition, a holster, digital scales, and other drug-related items.After unsuccessful motions to suppress, Carey was charged with possessing with intent to distribute marijuana and 500 grams or more of cocaine, 21 U.S.C. 841(a); possessing a firearm in furtherance of a drug-trafficking crime, 18 U.S.C. 924(c); and conspiring to possess with intent to distribute marijuana and 500 grams or more of cocaine hydrochloride, 21 U.S.C. 846. Slone testified against Carey. After rejecting challenges to evidentiary rulings and the calculation of Carey’s Guidelines range, the Third Circuit held that insufficient evidence supports Carey’s conviction for possession with intent to distribute 500 grams or more of cocaine and remanded for resentencing. View "United States v. Carey" on Justia Law

Venezuela boasts the “largest proven oil reserves in the world,” long under the “significant control” of the state. Venezuela formed PDVSA to exploit those resources. In 2011, Venezuela nationalized several gold mines and seized surrounding factories without compensation. Crystallex won relief in an international arbitral tribunal--$1.2 billion plus interest. The District of Columbia confirmed the award in 2017. Venezuela did not pay, Crystallex registered its judgment with the Delaware District Court under 28 U.S.C. 1963, and sued Venezuela to attach PDVSA’s shares in PDVH, PDVSA’s wholly-owned U.S. subsidiary. Crystallex hoped to ultimately reach funds in CITGO, a Delaware corporation indirectly owned by PDVH.The district court found that PDVSA was Venezuela’s “alter ego”; its property was subject to execution to satisfy Venezuela’s debt. The Third Circuit affirmed, citing Venezuela’s economic control over and profit-sharing with PDVSA. Other Creditors also obtained arbitration awards against Venezuela over debts incurred under broken contracts, then confirmed their arbitration awards in U.S. courts, registered those judgments, and moved for writs of attachment on PDVSA’s shares of PDVH.In 2018-2019, Venezuela experienced political upheaval. Guaidó, the interim president, took control of the shares of PDVH, appointing an ad hoc board of directors to manage the U.S. subsidiaries.Despite those changes, the Delaware District Court granted the Creditors’ motion, comprehensively describing PDVSA’s relationship to Venezuela and concluding PDVSA remains an alter ego of Venezuela. The Third Circuit affirmed that PDVSA remains the alter ego of Venezuela. View "OI European Group BV v. Bolivarian Republic of Venezuela" on Justia Law

Mahindra, incorporated in New Jersey, is wholly owned by a major Indian corporation. Mahindra has over 5,000 employees in the U.S. About 90% are South Asians although that group comprises 1–2% of the U.S. population and around 12% of the relevant labor market. Mahindra annually obtains thousands of H-1B visas, which permit hiring foreign workers for specialty occupations. Hindi is often spoken at Mahinda's regional conferences. In 2014, Mahindra hired Williams, a Caucasian American, as one of two non-South Asians in his sales group. He reported to a South Asian supervisor. In 2015, Mahindra terminated his employment.Williams was a member of the 2018 "Grant" putative race discrimination class action. In 2020, the North Dakota district court granted Mahindra’s motion to compel individual arbitration and stayed the case. Williams filed his putative class action in 2020, in the District of New Jersey, alleging disparate treatment on the basis of race. Williams did not deny that the longest applicable statute of limitations, four years, had expired but argued for tolling. The court dismissed Williams’s complaint without prejudice, finding that Williams had standing and was likely a member of the Grant putative class, and rejecting “American Pipe” tolling, under which the filing of a putative class action suspends the limitations period for absent class members’ individual claims. Williams’s complaint did not plausibly allege but-for causation on an individual basis. The Third Circuit vacated the dismissal for consideration of “wrong-forum tolling,” and whether Williams plausibly pleaded a pattern-or-practice claim. View "Williams v. Tech Mahindra (Americas) Inc." on Justia Law

Madrid-Mancia, who entered the United States from Honduras without being admitted or paroled, was immediately detained and served a putative Notice to Appear (NTA) charging her as removable, 8 U.S.C. 1229(a)(1)(A)–(D). The putative NTA directed Madrid-Mancia that she was “required to provide the DHS, in writing, with [her] full mailing address and telephone number,” and “notify the Immigration Court immediately” of any changes. It warned that “a removal order may be made by the immigration judge in [her] absence” if she failed to appear when summoned. The document stated that a removal hearing would take place on “a date to be set at a time to be set.” The Department of Justice sent Madrid-Mancia a second document (a “Notice of Hearing”) years later providing the missing information. She had moved and claims she never received the notice. When Madrid-Mancia did not appear as directed, she was ordered removed in absentia.The Third Circuit ordered that the removal order be rescinded. Congress only allows a supplemental notice “in the case of any change or postponement in the time and place of [an alien’s removal] proceedings,” 8 U.S.C. 1229(a)(2)(A). Here, no change or postponement occurred; DHS never issued a new Notice to Appear. View "Madrid-Mancia v. Attorney General of the United States" on Justia Law