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

The plaintiffs are participants in the Allergan Savings and Investment Plan, which provides various investment options, including an employee stock ownership feature for buying Allergan stock. According to the plaintiffs, the defendants were Plan fiduciaries and owed them commensurate duties under the Employee Retirement Income Security Act (ERISA). They claim that, although the public was unaware, the defendants knew or should have known that, before the divestiture of its generic-drug business, Allergan had conspired with other generic-drug manufacturers to fix prices, thereby artificially boosting its financial performance and its stock price. The plaintiffs cited inquiries from members of Congress and the Antitrust Division of the Department of Justice, seeking information about large price increases in certain generic drugs. The plaintiffs do not allege that Allergan was ever charged in connection with the investigation but claim that the defendants’ failure to remove Allergan stock as a Plan investment option or otherwise take action to protect Plan participants, violated ERISA.The Third Circuit affirmed the dismissal of the complaint. Even viewed in the light most favorable to the plaintiffs, the well-pled factual allegations fail to support a plausible inference that Allergan conspired with competitors to fix prices. Because all of the plaintiffs’ causes of action ultimately rest on the premise that the defendants knew or should have known about that supposed illegal conduct, the absence of allegations sufficient to support the existence of it is fatal to each of their claims. View "In re: Allergan ERISA Litigation" on Justia Law

Porter co-owned property with a partner. His wife, Debra, held an unrecorded $2.8 million mortgage on the property. Unbeknownst to Porter, his partner obtained a second mortgage on the property from Commerce. That mortgage went into default. The property was listed at a mortgage foreclosure sheriff’s sale. The Porters filed lawsuits before the sale. A Pennsylvania court awarded Debra damages for the title company’s failure to record her mortgage but declined to have it retroactively recorded and denied a motion to postpone the sale. A federal declaratory judgment action, claiming that Debra’s unrecorded mortgage had priority over Commerce’s mortgage, was still pending. Porter contacted the Sheriff’s Office before the sale and sought Commerce’s assurance that it would inform bidders about the pending lawsuit. Commerce’s attorney never arrived at the sale, so when the property came up for sale, Porter stood up to make the announcement. Sheriff’s Office attorney Chew and Deputy Stewart ordered him to stop speaking. They put Porter in a chokehold, placed him in handcuffs, and dragged him from the room. Porter and a deputy required medical attention. Porter was convicted of misdemeanor resisting arrest.On Porter's s Monell claim against Philadelphia based upon its unwritten policy of not allowing non-bidders to comment at a sheriff’s sales, the jury awarded him $750,000. The Third Circuit vacated the judgment. Chew’s unendorsed actions did not become municipal policy. There is no evidence that municipal decision-makers were aware of Chew’s inconsistent implementation of the no-comment policy or that Chew had previously used force to enforce it. Because the sheriff’s sale is a nonpublic forum, the Sheriff’s Office policy prohibiting comments is valid; it is viewpoint neutral and reasonable in light of the city’s right to preserve the property under its control for the use to which it is lawfully dedicated. View "Porter v. City of Philadelphia" on Justia Law

Pittsburgh Lieutenant Kacsuta saw brothers Beyshaud and Will leaving a store and thought that Beyshaud was holding synthetic marijuana, which reportedly was being sold from the store. She followed them, calling for backup. The brothers subsequently obeyed her direction to sit down. Will gave her his identification, then emptied his pockets. They did not have synthetic marijuana, but Kacsuta thought they had made an underage tobacco purchase. Beyshaud was 18 but did not have identification. Will’s identification confirmed he was over 18. Five officers, including Warnock and Welling, arrived. A dashboard camera recorded subsequent events. Kacsuta tossed Will's identification to the ground. Beyshaud reached for it, but Kacsuta stepped on it. The brothers complained that they were being harassed. Will took one or two steps toward Kacsuta and Warnock. Welling grabbed Will and slammed him into the wall, then on to the pavement. Beyshaud stood and attempted to punch Welling. Warnock deployed his taser, causing Beyshaud to fall to the ground. The brothers did not resist as six officers handcuffed them. They were convicted of disorderly conduct and harassment. The brothers sued Pittsburgh and police officers under 42 U.S.C. 1983.The Third Circuit reversed the denial of summary judgment on the excessive force claim against Kacsuta, who did not have an opportunity to intervene in Welling’s use of force. The court affirmed the denial of summary judgment to Welling. Viewing the facts in the light most favorable to Will, a jury could conclude that Welling’s use of force was objectively unreasonable, even taking Will’s disorderly conduct into account. Welling knew that Will was unarmed and outnumbered. The court dismissed, for lack of jurisdiction, Warnock’s argument concerning state law claims. View "El v. City of Pittsburgh" on Justia Law

In 2008, Easter was convicted of drug offenses involving crack cocaine and one firearms offense. The drug counts each carried a mandatory minimum penalty of 10 years’ imprisonment. The gun charge carried a mandatory consecutive minimum of five years’ imprisonment. The court determined that the guideline range for the drug offenses was 168-210 months, finding that Easter was responsible for possessing 343.55 grams of crack cocaine. The court added two levels because Easter obstructed justice and sentenced Easter to 228 months’ imprisonment--168 months on the drug offenses, consecutive to 60 months for the firearms offense. In 2014, Sentencing Guidelines Amendment 782 reduced the base offense levels of various drug quantities. The district court granted Easter a retroactive sentence reduction and imposed a sentence at the bottom of this range—135 months for the drug offenses and 60 consecutive months for the gun charge.In 2018, the First Step Act made the Fair Sentencing Act retroactive so that an offense must involve 280 grams or more of crack cocaine to trigger the 10-years-to-life range. Easter sought resentencing. The government argued that eligibility turns not on the drug weight for which Easter was convicted (50 grams) but on the weight for which he was held responsible at sentencing (343.55 grams). The court explained that Easter was held responsible for 343.55 grams of crack cocaine so that his sentencing range is identical to the range he had following Amendment 782 and declined to exercise its discretion to resentence Easter without addressing Easter’s request that it consider his post-sentence rehabilitation or other section 3553(a) factors. The Third Circuit vacated. In considering a motion for a sentence reduction under the First Step Act, a court must consider anew all of the 18 U.S.C. 3553(a) factors. View "United States v. Easter" on Justia Law

In a dispute concerning a construction company’s liability for contributions to the Benefits Fund, the Fund unilaterally scheduled arbitration. The company sought to enjoin arbitration, alleging fraud in the execution of the agreement it signed. The district court concluded that the court had the primary power to decide whether fraud in the execution vitiated the formation or existence of the contract containing the arbitration provision. The court enjoined arbitration pending resolution of factual issues that bear upon that claim.The Third Circuit affirmed. Under the Federal Arbitration Act (FAA), 9 U.S.C. 4, questions about the “making of the agreement to arbitrate” are for the courts to decide unless the parties have clearly and unmistakably referred those issues to arbitration in a written contract whose formation is not in issue. Here, the formation of the contract containing the relevant arbitration provision is at issue. View "MZM Construction Co. Inc. v. NJ Building Laborers Statewide BenefitsFunds" on Justia Law

The Center for Investigative Reporting sought a permanent injunction that would require the Southeastern Pennsylvania Transportation Authority (SEPTA) to run an advertisement on the inside of SEPTA buses. The advertisement promotes the Center’s research on racial disparities in the home mortgage lending market. SEPTA rejected the advertisement under two provisions of its 2015 Advertising Standards, which prohibit advertisements that are political in nature or discuss matters of public debate.The Third Circuit reversed the district court and ordered injunctive and declaratory relief. The challenged provisions of the 2015 Standards violate the First Amendment; they are incapable of reasoned application. The court noted the absence of guidelines cabining SEPTA’s General Counsel’s discretion in determining what constitutes a political advertisement and that the Center had demonstrated at least some instances of arbitrary decision-making. View "Center for Investigative Reporting v. Southeastern Pennsylvania Transportation Authority" on Justia Law

In 1993, Tazu left his native Bangladesh, entered the U.S. without inspection, and applied for asylum based on political persecution. Eight years later, an IJ denied that application. Tazu appealed to the BIA, alleging ineffective assistance of counsel. In 2003, the BIA denied his appeal, giving him 30 days to depart. Nearly six years later, he was detained for removal. An attempt at removal failed. His passport had expired; the airline would not let him board the plane. A passport would not likely be issued quickly. In 2009, Tazu was granted supervised release. He complied with the terms of his release, held a job, paid taxes, and raised his children. Seeking a provisional waiver, in 2017, his son, a U.S. citizen, filed Form I-130, which was approved. Tazu did not immediately take the next step, a Form I212. In 2019, the government got Tazu’s renewed passport and re-detained him for removal. He sought habeas relief in New Jersey, filed his Form I-212, and moved to reopen his removal proceedings based on ineffective assistance of counsel. He lost on every front.The Third Circuit ordered the dismissal of the habeas petition; 8 U.S.C. 1252(g) strips courts of jurisdiction to review any “decision or action by the Attorney General to ... execute removal orders.” Section 1252(b)(9) makes a petition for review—not a habeas petition—the exclusive way to challenge a removal action and funnels Tazu’s claims to the Second Circuit. Tazu has a petition for review pending in the Second Circuit. He can stay with his family while that litigation is pending,. View "Tazu v. Attorney General United States" on Justia Law

Twenty-one men from the South Side of York, Pennsylvania were charged on counts of racketeering conspiracy, drug-trafficking conspiracy, and drug trafficking. Four were also variously charged with federal firearms offenses related to the alleged trafficking. The indictment alleged that South Side had, since 2002, constituted the identity of a criminal enterprise associated with the Bloods, a national street gang, and ran an extensive drug-trafficking operation, conducted across a defined territory and nurtured by sporadic episodes of gang violence. Nine defendants pleaded guilty. Twelve proceeded to a joint trial, with more than 100 witnesses, including some of the original defendants. All 12 defendants were convicted of various charges and were sentenced to terms of imprisonment ranging from 60 months to life.The Third Circuit affirmed the convictions, rejecting arguments that the closure of the courtroom to the public during jury selection violated the Sixth Amendment right to a public trial and that the district court’s in camera disposition of a “Batson” challenge violated the defendants’ constitutional right to personal presence at all critical phases of their trial and was sufficiently prejudicial to warrant reversal. The court rejected challenges to the denial of motions to suppress evidence collected from the defendants’ residences pursuant to search warrants and to the admission and use of evidence at trial. The evidence was sufficient to support the verdicts. The court vacated certain sentences. View "United States v. Williams" on Justia Law

The SEC investigated Gentile for his role in a penny-stock manipulation scheme in 2007-08 and civilly sued Gentile, who was indicted for securities fraud violations. The criminal prosecution was dismissed as untimely. The SEC separately investigated securities transactions through an unregistered broker-dealer in violation of the Securities and Exchange Act of 1934, 15 U.S.C. 78o(a): Traders Café, a day-trading firm, maintained an account with Gentile’s Bahamian broker-dealer, which was not registered in the U.S. The SEC issued a Formal Order of Investigation into Café in 2013. Without issuing a new Formal Order, the SEC informed Gentile that he was a target in that investigation.The SEC subpoenaed Gentile for testimony. He refused to comply. The SEC did not seek enforcement against Gentile but subpoenaed Gentile’s attorney and an entity affiliated with Gentile’s Bahamian broker-dealer, which also refused to comply. The SEC commenced enforcement actions against those entities. Gentile unsuccessfully moved to intervene; the Florida district court ordered compliance. Gentile filed suit in New Jersey, seeking a declaration that the Café investigation was unlawful, requesting the quashing of the subpoenas, and seeking an injunction to prevent the SEC from using the fruits of that investigation against him.The Third Circuit affirmed the dismissal of the suit. The APA’s waiver of sovereign immunity, 5 U.S.C. 702, includes an exception for “agency action committed to agency discretion by law,” section 701(a)(2); sovereign immunity prevents judicial review of the Formal Order of Investigation. View "Gentile v. Securities and Exchange Commission" on Justia Law

The plaintiffs, who performed mattress deliveries for Sleepy's, signed Independent Driver Agreements, providing that the relationship was “non-exclusive.” Some drivers signed on their own behalf; others signed on behalf of their corporate entity (carrier). Individual drivers were required to form business entities, even if the business consisted of one driver and one truck. Sleepy’s did not pay wages to a carrier’s owners or workers. It paid each carrier for all the deliveries the carrier performed. An employee misclassification suit, seeking class certification, alleged that Sleepy’s misclassified the individual drivers as independent contractors and violated New Jersey law by making certain deductions and failing to pay overtime.The Third Circuit reversed the denial of certification of a proposed class of drivers who performed Sleepy's deliveries on a full-time basis using one truck. In addition to the Federal Rule of Civil Procedure 23 class action requirements, the Third Circuit requires that a Rule 23(b)(3) class be “currently and readily ascertainable.” Plaintiffs must show that the class is defined with reference to objective criteria and there is a reliable and administratively feasible mechanism for determining whether putative class members fall within the definition. The district court essentially demanded that the plaintiffs identify the class members at the certification stage and focused on gaps in Sleepy's records. Where an employer’s lack of records makes it more difficult to ascertain members of an otherwise objectively verifiable class, the employees who make up that class should not bear the cost of the employer’s faulty record-keeping. View "Hargrove v. Sleepys LLC" on Justia Law