Monday, May 20, 2013

Split Widened: Can a Court Bypass Rooker-Feldman to Dismiss on Merits?

Per Cawley v. Celeste (8th Cir. May 9, 2013)

Rooker-Feldman is one of the more esoteric doctrines of federal jurisdiction.  In brief, it prevents state court losers from using a federal case to appeal their defeat.  Importantly, in 2005's SABIC decision, the Supreme Court clarified that the doctrine is statutory, based on 28 U.S.C. 1257, not constitutional.

Nearly every time that Rooker-Feldman could apply, the federal defendant will also have a strong preclusion defense.  After all, for Rooker-Feldman to apply, there must already be a state court decision on the issue.

The circuits have split on whether district courts must adjudicate the Rooker-Feldman jurisdictional issue first, or may reach the preclusion issue on the merits without determining jurisdiction.  The CAs 3,6,and 7 all have published decisions saying that Rooker-Feldman must go first, and the CAs 9, 10, and 11 agree in unpublished decisions.

On the other hand, this CA8 opinion joins  published opinions from the CAs 1 and 7 (yes, the CA7 has published on both sides), and unpublished authority from the CAs 2, 3, and 10 (the latter two demonstrating another intra-circuit split) to hold that the court may reach the merits.

The CA8's reasoning is so clearly correct that I cannot improve upon it:

Steel Co. acknowledged that a federal court may reach a merits question before deciding a statutory standing question because the merits inquiry and the statutory standing inquiry often overlap, and it would be artificial to draw a distinction between the two.  That rationale may not support bypassing all questions of statutory jurisdiction.  But we think it does allow a federal court to decide a question of preclusion without first resolving a murky problem under Rooker-Feldman, because our inquiries under preclusion law and the Rooker-Feldman doctrine would similarly overlap.
(p. 6 (citations omitted).)

Indeed, the interplay between Rooker-Feldman and preclusion seems to fall perfectly within footnote 2 of Steel Co.  A court should, in the interests of judicial economy, be permitted to bypass a difficult Rooker-Feldman question if the preclusion result is much simpler.

On an aside--and part of my reason for selecting this case for comment--the topic of Rooker-Feldman allows me to pay tribute to my favorite legal publication, The Green Bag.  Right after SABIC and another Supreme Court case, the journal published an amusing obituary for the entire Rooker-Feldman doctrine.

Wednesday, May 15, 2013

Split Created: Does 2255(e)'s Savings Clause Apply To Past Misapplications of the Guidelines?

Per Brown v. Caraway (7th Cir. May 10, 2013)

Royce Brown always maintained his arson conviction was not a crime of violence.  Turns out, under Begay, he was right.  But Begay came much too late.  Brown was sentenced in 1996 as a career offender (adding several years to his sentence) based in part on his arson conviction.

Ordinarily, after Begay, Brown could have filed a 2255 motion to challenge his sentence.  But Brown had already filed--and lost--a 2255 motion in 2000.  And 2255(h) bars second or successive motions.

Brown nonetheless sought to profit from Begay and filed a 2241 petition for habeas corpus.  But 2255(e) bars consideration of habeas petitions, unless a 2255 motion  "is inadequate or ineffective to test the legality of his detention."  (This quoted text is often referred to as the "savings clause").

In this case, the CA7 creates a circuit split by holding that the savings clause applies, and permits a habeas petition.  The CA 11 (en banc) and CA5 had previously concluded--also in the context of 2241 petitions based on Begay--that the savings clause did not apply.

I am of two minds.  On one hand, equity favors allowing some relief where a sentence is manifestly in error.  On the other, considerations of finality must trump at some point.  I lean slightly to the CA11 and CA5's view that the  savings clause does not apply because 2255 procedures are in fact effective and adequate, but unavailable only because of a previous collateral attack.

I lean that way in part because--unlike the CA7--I do not think this conclusion leaves prisoners without a remedy.  Even if both a 2255 motion and a 2241 habeas petition are unavailable, a prisoner could file a petition for a writ of coram vobis (not nobis, as discussed below).

As this blog has discussed earlier, coram vobis requires:

  1. a fundamental error in the prior proceedings
  2. reasonableness in not having acted earlier (i.e., though habeas)
  3. collateral consequences from the prior proceedings (standing)
  4. interests of justice require granting the writ (no alternative remedy)
Here, application of the career enhancement is a fundamental error increasing the sentence.  Brown both preserved the issue by objecting in the initial sentencing and acted reasonably in raising it again soon after Begay was decided.  Brown's lengthened sentence provides standing.  And--if both 2241 and 2255 are not available--there is no alternative remedy.

Thus, I ultimately come out at the same point as the CA7, but would use a different procedural tool to get there.  I feel that this procedural tool does less damage to the "second or successive" bar.  But I am not a criminal lawyer, and there may be something I am missing.

On a total aside, I am surprised that the vast majority of U.S. courts call the writ "coram nobis" (before us) rather than "coram vobis" (before you).  The names do not imply a difference in procedure or remedies.  Rather, the distinction arose in English common law depending on whether a writ petition was filed before the King's Bench--where the King was supposed to preside, and so using the royal "we/us"--or Common Pleas, where the King did not preside, so the writ was only before "you" judges.  As America has no king, it would appear that "coram vobis" is more appropriate.

Friday, May 10, 2013

Split Noted: Effect of Failing to Object to a Magistrate's Report

Per Dupree v. Warden (11th Cir. May 7, 2013)

The CA11 requires a district judge to rule on all grounds raised in a habeas petition.  Here, the magistrate overlooked one claim.  The petitioner did not object, and the district court accepted the magistrate's report.

This CA11 panel does the right thing, and abides by panel precedent requiring a finding of reversible error.  (p. 8-9.)  In so doing, however, the panel notes that the CA11 is an outlier in a three-way circuit split regarding the effect of failing to object to a magistrate's report, and recommends an en banc to shift position.  (p. 14-19.)

Most Lenient:  The CA11 rule, which is the same as the CA8 and CA9, holds that failure to object has no effect on the de novo review of legal issues.  For factual issues, the CA11 and CA8 employ plain error review (see middle paragraph below), while the CA9 deems such objections waived (see strictest paragraph).

Middle:  The CA3 and CA5 always employ plain error review for both factual and legal issues.  They permit reversal if the appellant can show (1) plain (2) error that both (3) affects substantial rights and (4) undermines the fairness or integrity of judicial proceedings.

Strictest:  The CAs 2, 4, 6, 7, and 10 apply a firm waiver rule.  Failure to object waives appellate review of both factual and legal issues.  Such waiver may be waived by the court in the interests of justice, and does not apply if the magistrate does not warn of the effects of failing to object.

Here the panel recommends adopting the strictest approach.  I agree.  A number of considerations support this approach.

First, judicial economy, as the Supreme Court stated in Thomas v. Arn, 474 U.S. 140 (1985)--a decision affirming, but not requiring, the CA6's strict approach.

Second, if--as required--a magistrate warns of the effect of failing to object, then the failure to object is indeed the intentional relinquishment of a known right.  United States v. Olano, 507 U.S. 725 (1993).  And even if only done by counsel, counsel is an agent for the party, and the party is responsible for the failings of his counsel.  Link v. Wabash R.R. Co., 370 U.S. 626 (1962).  Such waiver argues against the middle-ground approach of the CA3 and CA5.

Third, imposing a waiver rule is not jurisdictional, so appellate courts still retain authority to correct manifest injustices.  Hormel v. Helvering, 312 U.S. 522 (1941).

Fourth, adopting a waiver rule would bring Civil Rule 72 in line with Criminal Rule 59, adopted in 2005.

In sum, all indications point to adopting the strictest rule.  And while the CA11 may go en banc to adopt that approach, the rulemaking committee should make the waiver rule explicit in civil rule 72, as it did in criminal rule 59.  That would spare the resources necessary for the CA8 and CA9 to also go en banc to adopt this appropriate rule.

Friday, April 26, 2013

Split Widened: Can The Venue of Post-Judgment Garnishment Proceedings Violate The Fair Debt Collection Practices Act?

Per Smith v. Solomon & Solomon, P.C. (1st Cir. Apr. 24, 2012)

This unanimous opinion (including Retired Justice Souter) widens a split concerning the venue provisions of the Fair Debt Collection Practices Act (FDCPA).  In brief, the FDCPA requires debt collectors to file any suit "against a[] consumer" where the consumer either (a) "resides" or (b) signed the document giving rise to the debt.  15 U.S.C. 1692i.  Failure to do so can result in civil liability.

The split at issue does not concern initial suits against the consumer to reduce the debt to judgment.  Instead, it concerns the venue for post-judgment enforcement proceedings.  The venue provisions of the FDCPA are still relevant because the FDCPA defines "debt" as "any obligation or alleged obligation of a consumer . . . whether or not such obligation has been reduced to judgment."

The CA1 nonetheless joins the CA11 in holding that, under the relevant state law (Mass. and Ga.), post-judgment garnishment proceedings are not governed by the FDCPA's venue provisions, because it is not a suit "against [the] consumer" (wage-receiver), but rather are against the employer/wage-payor.  (p. 4, 6.)  The CA9 had earlier reached the opposite conclusion, holding that under California law a garnishment action was against the consumer.  (p. 5, 8).

I think the CA1 gets this exactly right.  But I am concerned about the extent to which these decisions make the availability of garnishment or other enforcement remedies depend on the vagaries of state law.  Why should a consumer in Massachusetts be subject to garnishment if his employment is in a different county, but not a consumer in California (or Ohio)?

I think there is another way to reach the right result, one that would have resulted in the CA9 also holding in favor of the collector  As the CA9 opinion notes, Congress passed the FDCPA venue provisions to ensure that consumers would not have to defend against suits in far-away, inconvenient courts.  But a garnishment suit--whether against the consumer or employer--filed wherever the consumer actually works cannot be inconvenient, as the consumer already commutes there daily.

In other words, I would treat "resides" in the venue provision as including every jurisdiction where the consumer would be subject to general (not specific--thats why the signature provision exists) personal jurisdiction.  If a consumer has a house in County A, but works in County B, his continuous and systematic presence in county B would dictate that he "resides"  in both for FDCPA purposes, and County B's exercise of jurisdiction surely would not offend notions of fair play.

True, the noun residence is ordinarily understood as a dwelling.  But--especially with the long hours at firms--a good argument could be made that I dwell both at work and home.  In the words of an old CA2 case:
Domiciliaries are those who have a fixed, permanent and principal home and to which, whenever absent, they always intend to return. At the opposite end of the scale are transients, those persons who are just passing through a locality. In between these notions of permanence and transience are residents. Residency means an established abode, for personal or business reasons, permanent for a time. 

Friday, April 12, 2013

Split Widened: Does U.S.S.G. 2G2.2(b)(3)(F) require knowledge?

Per United States v. Robinson (7th Cir. Apr. 9, 2013)

Although I am far more of a textualist than he, I am a fan of Judge Posner.  But this is one of the worst opinions from him that I have read.  It is internally contradictory, overlooks the obvious implications of the authorities it relies on, and creates an unnecessary make-work remand.

The split at issue is whether distribution has to be knowing for purposes of 2G2.2(b)(3)(F).  The text of the relevant commentary defining "distribution" and "distribution to a minor" provide:
"Distribution" means any act, including possession with intent to distribute, production, transmission, advertisement, and transportation, related to the transfer of material involving the sexual exploitation of a minor. Accordingly, distribution includes posting material involving the sexual exploitation of a minor on a website for public viewing but does not include the mere solicitation of such material by a defendant. 
"Distribution to a minor" means the knowing distribution to an individual who is a minor at the time of the offense
The CA10 held that knowledge was not required because (1) the text of the commentary is silent with respect to mens rea, (2) the usual presumption of a mes rea requirement, applicable to criminal laws, does not apply to Guidelines, and (3) reading a mens rea requirement into the definition of distribution would render the word "knowing" in the definition of distribution to a minor superfluous.

Here, the CA7 joins the CA8 (whose opinion is quite opaque) to reach the opposite conclusion, that knowledge is required.  (p.3.)  It provides only one reason for this conclusion:  that strict liability is disfavored in the criminal context.  In addition, Judge Posner rejects the argument (apparently not made) that knowledge of a peer-to-peer network's capabilities would make distribution "knowing," on the grounds that the criminal presumption of knowledge of the law does not apply in the Guidelines context.  Finally, Judge Posner rejects the CA10's superfluity analysis by reading the commentary's use of "knowing" to apply to the fact of the recipient's minority, rather than just to distribution.

As intimated in the introduction, I am inclined to agree with the CA10.  The relevant commentary is silent, the canon against superfluity applies, and the presumption of a mens rea does not apply to the guidelines.  With respect to Judge Posner's attempt to rebut the canon against superfluity, knowing should be read as modifying its closest noun, distribution, and not minor.

Moreover, Judge Posner's analysis is self contradictory in two respects.  First, he relies on the criminal law presumption of a mens rea, though numerous circuits have concluded that that presumption does not apply to the Guidelines, while rejecting the criminal law presumption of knowledge of the laws precisely because of the Guidelines context (though numerous circuits have applied this presumption to the Guidelines).  Second, Judge Posner notes that the Sentencing Commission has taken note of the split between the CA8 and CA10, and has stated "the guideline could be amended to better distinguish between more and less culpable distribution conduct.”  (p.5 (emphasis added).)  But he fails to draw the obvious conclusion:  That in the Sentencing Commission's view, unknowing conduct is still distribution, albeit less culpable.

What makes this all the worse, however, is that the opinion is reviewing for plain error.  Certainly, as the analysis above shows, the knowledge requirement is not plain.  (Judge Posner's opinion only introduces the plain error framework after undertaking what appears to be a de novo review of the Guidelines).  Plus, for a reversal on plain error, the defendant has the burden of showing that the error affected his substantial rights.  Here, I do not know how the Defendant could possibly have met that burden, where the ultimate sentence imposed was at the low-end of the guidelines range without taking the 2G2.2(b)(e)(f) enhancement into account.  Judge Posner entirely overlooks the burden of proof, and does not require the Defendant to offer any evidence that the sentencing judge might have or would have imposed a lesser sentence under a supposedly "proper" guidelines calculation.  This ultimately results in a make-work remand, unnecessarily burdening the judicial system..

Wednesday, April 3, 2013

Split Widened: Does Bankruptcy Stay a Tax Court Appeal?

Per Schoppe v. Comm'r (10th Cir. Mar. 28, 2013)

Never has my textualism been more difficult to follow.  I am 100% sure that Congress meant to accomplish what its words seemingly (but not too surely) preclude.  I strongly recommend that any legislation/statutory construction professors use excerpts of some of the historical (not necessarily current) cases on both sides of this split.  For example, the Ninth Circuit has a good discussion about when not to apply the canon against superfluity.

Even better, the issue is relatively simple to explain.  A bankruptcy filing automatically stays most proceedings against the debtor.  Courts have interpreted this stay to apply to cases where the debtor is the appellant, provided that he was the defendant in the underlying proceedings.

The split concerns whether the stay applies to debtor appeals of tax court proceedings, where the debtor must initiate the tax court proceedings against the Commissioner, but will never actually receive any affirmative relief, but only a potential reduction/elimination of a deficiency.  Are such proceedings "against" the debtor, so that they can be stayed?

Here, the CA10 joins the CA11 in saying no, the stay does not apply.  The CA9 said yes.  As indicated above, I have a really hard time figuring out where I would come out.

On one hand, it is entirely clear that Congress intended the stay to apply.  Indeed, the statute explicitly covers proceedings in the tax court, see 11 USC 362(a)(8), and there is no logical reason why lower court but not appellate proceedings should be covered.

On the other hand, it also fairly clear that the relevant statutory text does not cover tax court appeals.   The stay covers:
 the commencement or continuation . . . of a judicial, administrative, or other action or proceeding against the debtor . . ., or to recover a claim against the debtor that arose before the commencement of the case under this title.
Id. 362(a)(1).  For three reasons, this does not apply.  First, the tax court proceeding is initiated by the debtor, against the commissioner.  Second, the tax court proceeding is not a continuation of the administrative process against the debtor, because the Supreme Court has said that tax court proceedings are judicial proceedings not subject to deferential review.  Third, tax court proceedings are not to recover a claim against the debtor, because the court cannot afford the Commissioner affirmative relief (that's for the administrative mechanisms), just uphold or reject the deficiency calculation.

In the end, I believe I would concur dubitante (background) in whatever path my hypothetical panel chose.  Certainly, my textualism points me toward thinking (like the CA10 here) that the stay doesn't apply.  At the same time, the CA9 opinion on the other side is quite strong, and purposivism suggests that the stay should apply.  I could textually justify applying the stay in two ways:
  1. Treating a tax court proceeding as a declaratory judgment action, with the debtor as the declaratory judgment plaintiff seeking to avoid potential liability.  Then, hypothetically realigning the parties (as permitted by the Supreme Court) to treat the tax court proceeding as against the debtor.  See Pub. Serv. Comm'n of Utah v. Wycoff Co., Inc., 344 U.S. 237, 248 (1952)
  2. Treating the tax court appeal as the "continuation of a proceeding before the United States Tax Court," even though the appellate proceedings are no longer before the Tax Court.

Sunday, March 24, 2013

Split Noted: Is Application of a Lengthened Limitations Period Retroactive?

Per U.S. ex rel. Carter v. Halliburton Co. (4th Cir. Mar. 18, 2013)

All qui tam plaintiffs should take note of this opinion, if only because has the effect of freezing the False Claims limitations bar in October 2002 (and thus also lengthens any potential damages period).

In dissent, Judge Agee notes (29 n.4) a circuit split on whether application of a limitations period that is lengthened after the relevant conduct is retroactive (and hence impermissible).  To provide an example, on Date X, Defendant does something for which there is a 1 year limitations period.  At some point after Date X, the legislature changes the period to 2 years.  In year 2, plaintiff files suit.  Can Defendant raise a viable limitations defense?

Judge Agree agrees with the CA6 that the answer is no.  Giving effect to the new limitations period is not retroactive, because limitations regulates not the underlying conduct, but when the Plaintiff may file suit.  In the words of the CA6 opinion cited by Judge Agee, "the 1991 Act applies to Forest's conduct, the filing of the complaint, which occurred after the enactment of the statute. Therefore, application of the 90-day statute is prospective in this case."  Thus, in this view, the new limitations period applies because the key date for retroactivity is the filing of the complaint.

I disagree, and side with the CA9.  The key date is not when Plaintiff finally files suit, but rather the date of passage/enactment of the limitations period.  Under this analysis, whether the hypothetical defendant can raise a limitations defense depends on whether the legislature acted in year 1 (no), or in year 2 (yes).

If the legislature acted in year 1, all is fine.  Plaintiff still had a viable claim, we presume he was on notice of the statute lengthening the limitations period.  The longer period thus did not affect anybody's substantive rights:  Plaintiff still had a cause of action, Defendant still had potential liability.

But if the legislature acted in year 2, then applying the new statute of limitations is retroactive.  Plaintiff no longer had a viable cause of action, defendant had escaped liability.  Applying the new limitations period would thus create a new substantive right in plaintiff, and a new liability in Defendant, when both had previously expired at the end of year 1.

Thus, the key point for retroactivity analysis is (1) the status of Plaintiff's claim on (2) the date the statute was passed/took effect.

Ultimately, this analysis calls to mind Justice Scalia's concurrence in Landgraf itself.  Justice Scalia, joined by Justices Thomas and Kennedy, criticized the majority for focusing on the substance/procedural divide, rather than looking at what conduct the statute was meant to regulate.  As any Civ Pro student knows, categorizing limitations periods as substantive or procedural so flummoxed the Supreme Court in Guarantee Trust that Justice Frankfurter crafted the outcome-determinative test to hold that--as with other parts of substantive law--state limitations periods should be applied in federal courts in diversity.  This result alone demonstrates how limitations periods can affect substantive rights.  By following the concurring opinion, one is left with the conclusion that the CA9 was correct in holding:
We do not find the substantive/procedural dichotomy helpful in deciding this case.  Regardless of whether a statute is "substantive" or "procedural," it may not apply to cases pending at the time of enactment if the new statute would prejudice the rights of one of the parties. . . . [W]e hold that a newly enacted statute that lengthens the applicable statute of limitations may not be applied retroactively to revive a plaintiff's claim that was otherwise barred under the old statutory scheme because to do so would "alter the substantive rights" of a party and "increase a party's liability."