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

Williams and Burton each filed civil rights complaints in the Western District of Pennsylvania against employees of the Pennsylvania Department of Corrections and moved to proceed in forma pauperis (IFP). Burton alleged that the defendants retaliated against him after he filed a grievance, concerning his use of the law library. Williams alleged that prison staff refused to accommodate his special dietary needs. Both plaintiffs consented to have their cases heard by magistrate judges, who dismissed the cases before the defendants consented to magistrate judge jurisdiction.The Third Circuit vacated. A magistrate judge can acquire jurisdiction to decide a case only by the consent of the parties, 28 U.S.C. 631(c)(1); “consent of the parties” does not mean consent just of the prisoner-plaintiff. The jurisdictional requirement cannot be waived by the parties. If the requirements of Section 636(c)(1) are not satisfied, the “magistrate judge [is deprived] of jurisdiction over the case” and the appellate court is statutorily deprived of appellate jurisdiction over the magistrate judge’s orders. Consent could not be implied in this case and retroactive, post-judgment consent cannot satisfy the statutory requirement. View "Burton v. Schamp" on Justia Law

Agarwal, a contract network engineer, had security credentials that granted him access to the corporate offices and internal networks of telecommunications companies. Agarwal installed key-logging software to obtain employee usernames and passwords and installed unauthorized hardware and computer code that enabled him to surreptitiously transfer information. Agarwal also used a vacant office without authorization. The companies learned of the unauthorized activities and devoted significant resources to investigate and remediate the breaches; compromised accounts and computers were temporarily taken offline. Agarwal monitored the investigations.Agarwal eventually pleaded guilty to aggravated identity theft, 18 U.S.C. 1028A(a)(1), and two counts under the Computer Fraud and Abuse Act (CFAA) for intentionally accessing a protected computer without authorization and obtaining information valued at more than $5,000, 18 U.S.C. 1030(a)(2); 1030(c)(2)(B)(iii). The statutory maximum sentence was 12 years, five years for each CFAA violation, plus a mandatory consecutive two-year term for identity theft. Agarwal disputed the PSR's loss calculation of over $3,000,000, most of which was for salary expenses for investigating and remediating the breaches. His Guidelines range was 70-87 months’ imprisonment for the CFAA violations. The court sentenced Agarwal to 70 months’ imprisonment for the CFAA violations, plus the mandatory two-year sentence. The Third Circuit affirmed, rejecting an argument the plea was unknowing because Agarwal could not have reasonably foreseen the losses that would be attributed to his CFAA violations. Agarwal signed the plea agreement aware that the loss amount was disputed and waived the right to appeal his sentence. View "United States v. Agarwal" on Justia Law

June’s son, Brenden, suffers from severe bipolar disorder and is prone to violent outbursts. He has repeatedly been jailed and institutionalized. In 2017, he was involuntarily admitted to Greystone, a New Jersey state-run psychiatric hospital, where Brenden’s condition worsened. He stalked the halls, made an aggressive sexual comment to a staffer, and attacked other patients, sending one to the intensive care unit. Greystone staff encouraged June’s visits as part of Brenden’s treatment. Before one visit, June asked if it was safe to visit Brenden. Though Brenden had severely beaten another patient days earlier, his psychiatrist, Dr. Young, assured her that it was safe. Greystone employees were supposed to supervise all patient meetings but no one was assigned to monitor June’s visit. Initially, Brenden’s head nurse, Oglesby accompanied June, During June’s visit, Oglesby left the room. Brenden then attacked June, who suffered brain trauma, broken ribs, and PTSD.The district court dismissed June’s suit under 42 U.S.C. 1983. Sovereign immunity barred the claims against Greystone and state officials in their official capacity. The Third Circuit reversed as to Oglesby, who abandoned June mid-visit. June’s injury was fairly direct as well as foreseeable. Oglesby’s affirmative act endangered June; her departure deprived June of the freedom to avoid an unsupervised visit or to take other precautions. Dr. Young took no affirmative acts. View "Mears v. Connolly" on Justia Law

TitleMax provides vehicle loans at interest rates as high as 180%. The entire process occurs at a TitleMax brick-and-mortar location. The borrower receives “a check drawn on a bank outside of Pennsylvania,” The borrower grants TitleMax a security interest in the vehicle. TitleMax records its lien with the appropriate state authority. Borrowers can make payments from their home states. TitleMax does not have any offices, employees, agents, or brick-and-mortar stores and is not licensed as a lender in Pennsylvania. TitleMax claims that it never solicited Pennsylvania business and does not run television ads within Pennsylvania.Pursuant to the Consumer Discount Company Act and the Loan Interest and Protection Law, Pennsylvania’s Department of Banking and Securities issued a subpoena requesting documents regarding TitleMax’s interactions with Pennsylvania residents. TitleMax then stopped making loans to Pennsylvania residents and asserts that it has lost revenue.The district court held that Younger abstention did not apply and that the Department’s subpoena’s effect was to apply Pennsylvania’s usury laws extraterritorially in violation of the Commerce Clause.The Third Circuit reversed. Applying the Pennsylvania statutes to TitleMax does not violate the extraterritoriality principle. TitleMax receives payments from within Pennsylvania and maintains an actionable security interest in vehicles located in Pennsylvania; its conduct is not “wholly outside” of Pennsylvania. The laws do not discriminate between in-staters and out-of-staters. Pennsylvania has a strong interest in prohibiting usury. Applying Pennsylvania’s usury laws to TitleMax’s loans furthers that interest and any resulting burden on interstate commerce is, at most, incidental. View "TitleMax of Delaware Inc v. Weissmann" on Justia Law

Martin’s state conviction became “final” in April 2002, triggering the one-year limitations period on state prisoners seeking federal habeas corpus relief, 28 U.S.C. 2244(d)(1). The clock ran for 193 days, until October 21, 2002, when Martin filed a petition for state post-conviction relief (PCR). The clock was paused until June 14, 2004, the last day on which Martin could have appealed (but did not) the trial court’s denial of his petition—and expired 172 days later, on December 3, 2004. In June 2015, Martin filed a petition seeking federal habeas relief. The state appellate court had accepted Martin’s April 2012 motion for leave to appeal “as within time” the denial of his 2002 PCR petition; he argued that the ruling retroactively tolled the limitations period. Martin essentially argued that a “properly filed” PCR petition is “pending” under section 2244(d)(2) for the period between the expiration of time under state law in which a prisoner could have timely appealed the denial of a PCR petition, and the prisoner’s submission of a motion for leave to file a PCR appeal “as within time.”.The Third Circuit affirmed the dismissal of his petition as untimely. Section 4 2244(d)(2)’s tolling mechanism looks forward, not backward, and a state court’s acceptance of an appeal “as within time” does not rewind the one-year clock. View "Martin v. Administrator New Jersey State Prison" on Justia Law

For 20 years, the vendor (SDM) provided food services at Drexel University in Philadelphia. In 2014 the university announced that it would competitively bid the contract for on-campus dining. The same vendor ultimately won that competition but about two years into the contract’s 10-year duration, the vendor sued the university for fraud, multiple breaches of contract, and alternatively for unjust enrichment. The university responded with fraud and breach-of-contract counterclaims. Only a few of the vendor’s breach-of-contract claims and portions of the university’s breach-of-contract claim survived summary judgment. The parties referred the remaining claims and counterclaims to arbitration and jointly moved to dismiss them. The district court granted that motion and entered final judgment, which the parties appealed, primarily to dispute the summary judgment ruling.The Third Circuit affirmed summary judgment in Drexel’s favor on SDM’s unjust enrichment and punitive damages claims, summary judgment in SDM’s favor on Drexel’s fraudulent inducement claim, and the district court’s decision to deny Drexel’s motion to strike declarations by SDM witnesses under the sham affidavit rule. The court vacated an order granting summary judgment to Drexel on SDM’s claims for fraudulent inducement, breach of contract for failure to renegotiate in good faith, and breach of a supplemental agreement for the Fall 2016 Semester. The surviving claims were remanded to the district court. View "SodexoMAGIC LLC v. Drexel University" on Justia Law

About 100 Pennsylvania landowners filed a class-action complaint, alleging that EQT has been storing natural gas in six separate storage fields, thereby utilizing the landowners’ underground pore space without providing them compensation. Months later, all landowners except for Laudato voluntarily dismissed their claims without prejudice. Laudato later moved for class certification, seeking approval of a class of: All persons and/or entities that own and/or owned real property—and/or natural gas storage rights to real property—located within the certificated boundaries of one or more of the Gas Storage Fields for any period of time, not before Defendants’ inception of the respective gas. The district court, exercising federal-question jurisdiction over claims under the Natural Gas Act, 15 U.S.C. 717–17z, agreed to class certification but rejected Laudato’s proposed class definition, refusing to grant other downstream requests such as the appointment of a class representative, the appointment of class counsel, and certain issues’ certification. The court directed the parties to meet and confer “regarding the establishment of an appropriate class definition.”The Third Circuit granted a petition for review, holding that because the order clearly implicates Rule 23(f), it had jurisdiction and that interlocutory review was appropriate. View "Laudato v. EQT Corp." on Justia Law

In 2017, a man was found dead next to 22 small wax bags containing fentanyl-laced heroin, stamped “WI FIGHT?” He had overdosed on fentanyl and heroin. Officers determined that M.M. was the victim’s drug dealer. Charged with intent to distribute a controlled substance, 21 U.S.C. 841(a)(1), and distribution of a controlled substance resulting in death, section 841(b)(1)(C), M.M. entered into a plea agreement. Pursuant to 18 U.S.C. 3553(e), the government recommended a departure below the applicable mandatory minimum sentence of 240 months if M.M. provided “substantial assistance.”M.M. invoked section 3553(a)'s factors, including his addiction and psychological issues related to his upbringing. The court granted the downward departure motion after evaluating M.M.’s cooperation and addressing those factors but without specifying the basis of the departure. The government challenged the 120-month sentence under Rule 35(a), arguing that section 3553(e) does not allow a court to reduce a sentence below a statutory mandatory minimum based on considerations unrelated to substantial assistance. The District Court agreed that clear error had occurred and clarified that M.M.’s substantial assistance entitled him to a departure to 180 months’ imprisonment. The Third Circuit vacated. The authority to amend a sentence under Rule 35(a) is very narrow and there was no clear error in the original sentence. View "United States v. Minichella" on Justia Law

Jaffal, born in Jordan, sought a declaration that he is entitled to derivative U.S. citizenship under former 8 U.S.C. 1432(a), which provides that “a child born outside the United States automatically acquires United States citizenship if, while the child is under the age of eighteen, the parent with legal custody of the child is naturalized while that child’s parents are legally separated.” Jaffal’s father was naturalized when Jaffal was 17 years old. Jaffal presented evidence that he was in the sole legal custody of his father when his father was naturalized and his parents were separated. The district court declined to accept Jaffal’s evidence of his parents’ divorce because there was no evidence that Jaffal’s mother participated in the Jordanian divorce.The Third Circuit reversed and remanded with instructions to issue a judgment declaring Jaffal to be a national of the United States. If a §section1432(a) petitioner establishes that a valid, legal separation was effectuated under the relevant state or foreign nation’s law, he has met the burden of establishing a legal separation. Jordanian courts had the authority to alter Jaffal’s parents’ marriage. The Jordanian divorce established Jaffal’s parents’ legal separation as a matter of law. View "Jaffal v. Director Newark New Jersey Field Office Immigration & Customs Enforcement" on Justia Law

Venezuela expropriated mining rights owned by Crystallex, a Canadian mining company. After prevailing in an arbitration proceeding, Crystallex obtained a $1.4 billion judgment. In an execution action, Crystallex seeks to auction shares owned by Venezuela’s state-owned energy company, PDVS, to satisfy its judgment against Venezuel, including PDVSA’s shares in PDVH, a Delaware holding company that owns CITGO, a U.S. petroleum refiner (one of PDVSA’s most important U.S. assets). The district court held that it had jurisdiction to enforce the judgment against Venezuela and that PDVSA could not assert sovereign immunity as a defense and ordered PDVH’s registered agent to retain the stock until further order. In an earlier appeal, the Third Circuit affirmed.Political conditions changed in Venezuela. The Office of Foreign Assets Control (OFAC), which administers U.S. economic sanctions, prohibited the transfer of assets without OFAC approval. On remand, PDVSA, PDVH as the garnishee, and CITGO asked the district court to quash the writ of attachment. The United States filed a statement of interest urging the court not to authorize a contingent sale of the shares.The district court refused to quash the attachment and decided “to set up the sales procedures and then to follow them to the maximum extent that can be accomplished without a specific license from OFAC,” including appointing a special master. The Third Circuit dismissed an appeal for lack of jurisdiction. The district court has not reached a final decision. 28 U.S.C. 1291. View "Crystallex International Corp v. Bolivarian Republic of Venezue" on Justia Law