Per Mora v. People of N.Y., 2008 WL 1820836 (2d Cir. Apr. 24, 2008)
Medellin made waves when came down, but it turns out the Supreme Court in that case (as with others before it) did not decide an issue that had split the circuits: Whether the Vienna Convention’s provision requiring police officers to notify detainees that they could communicate with their consulate. Instead a majority of the court Court assumed, without so holding, that the Vienna Convention did so. The Circuits have split on this issue. The CAs 4,5,6,9, and now 2 hold that the Vienna Convention does not create judicially-enforceable rights, whereas the CA 7 holds that it does. The separate question of whether the Vienna Convention is self-executing was not raised in this case.
Article 36(b) provides: “if he so requests, the competent authorities of the receiving State shall, without delay, inform the consular post of the sending State if, within its consular district, a national of that State is arrested or committed to prison or to custody pending trial or is detained in any other manner. Any communication addressed to the consular post by the person arrested, in prison, custody or detention shall also be forwarded by the said authorities without delay. The said authorities shall inform the person concerned without delay of his rights under this sub-paragraph;”
The CA 7 says that this language is clear that it creates an individually enforceable right; how else can you read “of his rights.” Moreover, the CA 7 argues, this is clearly not a right conferred on the sending State, because its exercise depends on the request of the detainee. As final support for its position, the CA 7 looks to State Department circulars, and DOJ regulations referring to Article 36 as providing an individual right.
The CA 2 disagrees, noting that the obligation to inform a detainee of his rights is, itself, never phrased as a right; nor does this or any other provision of the Vienna Convention state whether private individuals can pursue judicial enforcement of the treaty in the domestic courts of the States-party. The CA 2 also relies on the Preamble to Article 36 and the Convention as a whole, which disclaim any purpose to benefit individuals. Finally, the State Department submitted an amicus brief in conjunction with the Department of Justice urging the conclusion that the Convention does not confer a judicially-enforceable individual right. The CA 2 says the views of the Executive concerning treaty interpretation are entitled to great deference.
As an interesting aside, the panel requested the United States to provide information regarding other states’ practices with regards to private suits for money damages for violations of Article 36. 91 countries replied, 90 of which do not permit such suits to go forward. In addition, the State Department informed the panel that only a handful of countries had interpreted Article 36 as providing an individual right. The opinion does not state, however, how many of the countries had interpreted the Article the other way (i.e. if the handful was 100% or 10% of the countries to have considered the question). Such state practice is meaningful in the interpretation of treaty obligations.
Friday, April 25, 2008
Thursday, April 24, 2008
Split Created: Is Claim-Splitting Permitted By The Contract Disputes Act?
Per Phillips/May Corp. v. United States, 2008 WL 1808548, *5-*9 (Fed. Cir. Apr. 23, 2008)
Now I have truly covered every circuit. Phillips/May was awarded a contract to design and construct a Religious Ministry Facility at a military base. It completed the project over a year and a half late, after various contract modifications were made. A month after completing work, Phillips/May submitted ten claims to the Contracting Officer. The officer failed to act on any of these claims, and this inaction constituted an appealable rejection after sixty days. Phillips appealed nine of the ten claims the Armed Services Board of Contract Appeals Ultimately, the parties entered into a global settlement agreement with respect to the nine claims, and the Board entered judgment to that effect.
Six months later, Phillips/May appealed the denial of the tenth claim to the Court of Federal Claims. After the suit was filed, the Contracting Officer offered a determination that Phillips/May was collaterally estopped from raising this claim separate from the other nine claims which arose out of the same set of transactional facts. The question in this appeal is whether the unique procedures of the Court of Federal Claims and public contract disputes permit claim-splitting without raising issues of res judicata, contrary to the general procedure of civil actions.
41 U.S.C. § 609(d) suggests that claim-splitting is permitted in contract actions: “If two or more suits arising from one contract are filed in the United States Court of Federal Claims and one or more agency boards,” the Court of Federal Claims may consolidate them in the interests of justice. This provision does envision separate suits arising from the same contract, and would seemingly resolve this case.
Judge Dyk, on behalf of a unanimous panel, however, notes that this provision does not clearly state that the splitting of all claims, as opposed to transactionally unrelated claims, is permissible. Relying on this ambiguity, this panel of the Federal Circuit then turns to the drafting and legislative history of the Contracts Dispute Act. Congress specifically included, considered, and finally eliminated statutory language which would have expressly permitted claims-splitting between fora. The panel concludes that this rejection implies that Congress intended for claim preclusion to apply with its normal force. The panel does recognize, in a footnote, that it is creating a circuit split from the CA 6.
I think that the Federal Circuit in this case gets Congress’s intent 100% right, and the language of the statute 100% wrong. The manufactured ambiguity just isn’t there. The statutory section permits separate suits “arising from one contract,” meaning separate suits that arise from similar facts. It will be interesting to see what happens if Phillips/May pursues certiorari – an issue of statutory interpretation on which the circuits are split and that governs the jurisdiction of courts when reviewing public contracts seems important enough... Then again, the split is largely irrelevant because almost all these cases go to the Federal Circuit.
Now I have truly covered every circuit. Phillips/May was awarded a contract to design and construct a Religious Ministry Facility at a military base. It completed the project over a year and a half late, after various contract modifications were made. A month after completing work, Phillips/May submitted ten claims to the Contracting Officer. The officer failed to act on any of these claims, and this inaction constituted an appealable rejection after sixty days. Phillips appealed nine of the ten claims the Armed Services Board of Contract Appeals Ultimately, the parties entered into a global settlement agreement with respect to the nine claims, and the Board entered judgment to that effect.
Six months later, Phillips/May appealed the denial of the tenth claim to the Court of Federal Claims. After the suit was filed, the Contracting Officer offered a determination that Phillips/May was collaterally estopped from raising this claim separate from the other nine claims which arose out of the same set of transactional facts. The question in this appeal is whether the unique procedures of the Court of Federal Claims and public contract disputes permit claim-splitting without raising issues of res judicata, contrary to the general procedure of civil actions.
41 U.S.C. § 609(d) suggests that claim-splitting is permitted in contract actions: “If two or more suits arising from one contract are filed in the United States Court of Federal Claims and one or more agency boards,” the Court of Federal Claims may consolidate them in the interests of justice. This provision does envision separate suits arising from the same contract, and would seemingly resolve this case.
Judge Dyk, on behalf of a unanimous panel, however, notes that this provision does not clearly state that the splitting of all claims, as opposed to transactionally unrelated claims, is permissible. Relying on this ambiguity, this panel of the Federal Circuit then turns to the drafting and legislative history of the Contracts Dispute Act. Congress specifically included, considered, and finally eliminated statutory language which would have expressly permitted claims-splitting between fora. The panel concludes that this rejection implies that Congress intended for claim preclusion to apply with its normal force. The panel does recognize, in a footnote, that it is creating a circuit split from the CA 6.
I think that the Federal Circuit in this case gets Congress’s intent 100% right, and the language of the statute 100% wrong. The manufactured ambiguity just isn’t there. The statutory section permits separate suits “arising from one contract,” meaning separate suits that arise from similar facts. It will be interesting to see what happens if Phillips/May pursues certiorari – an issue of statutory interpretation on which the circuits are split and that governs the jurisdiction of courts when reviewing public contracts seems important enough... Then again, the split is largely irrelevant because almost all these cases go to the Federal Circuit.
Wednesday, April 23, 2008
Fun: What Frequently Cited Law Review Article Has Had The Biggest Influence In The Courtroom?
This blog has previously discussed what popular television show has appeared most frequently in the pages of the Federal Reporter. Prompted by this recent trivia post at PrawfsBlawg, I decided to see if the law review articles that had a major effect within academia also had a similar effect outside the ivory tower, more specifically, in the courtroom.
I selected the top thirty articles as listed on PrawfsBlawg and described in Fred Shapiro’s 1996 law review article. Some of these articles were too old to be included in the Westlaw database themselves, so I could not use the citing references tool. Instead, I structured a search looking for the author’s last name within a paragraph of the title within a paragraph of one of the journal identifiers within a paragraph of the year of publication. For example, the search for the law review article most cited in other articles was: Coase /p “The Problem of Social Cost” /p Econ! /p 1960. I performed this search within the allcases and cta databases of Westlaw separately.
My table of results can be found here (PDF). Looking at the data, three quick conclusions came to mind. First, it is good to be a Justice – even your academic writings are frequently cited in court materials. The top two articles were published over a century ago, and only three of the top ten were published after 1970. Four of the top five also deal with issues of individual rights, whereas the fifth deals with the study of law as a science. These facts lead to the second conclusion – law review articles were more influential in the past, when they dealt with black-letter law. For more on this phenomenon, see here (NY Times article), here (Volokh discussion and linkwrap), and here (.PDF study). The final conclusion is not all that surprising. Some of the articles which have proved the most influential in the academy have not been able to reach outside the ivory tower and into the courtroom. (This author thinks that might be for the better).
I selected the top thirty articles as listed on PrawfsBlawg and described in Fred Shapiro’s 1996 law review article. Some of these articles were too old to be included in the Westlaw database themselves, so I could not use the citing references tool. Instead, I structured a search looking for the author’s last name within a paragraph of the title within a paragraph of one of the journal identifiers within a paragraph of the year of publication. For example, the search for the law review article most cited in other articles was: Coase /p “The Problem of Social Cost” /p Econ! /p 1960. I performed this search within the allcases and cta databases of Westlaw separately.
My table of results can be found here (PDF). Looking at the data, three quick conclusions came to mind. First, it is good to be a Justice – even your academic writings are frequently cited in court materials. The top two articles were published over a century ago, and only three of the top ten were published after 1970. Four of the top five also deal with issues of individual rights, whereas the fifth deals with the study of law as a science. These facts lead to the second conclusion – law review articles were more influential in the past, when they dealt with black-letter law. For more on this phenomenon, see here (NY Times article), here (Volokh discussion and linkwrap), and here (.PDF study). The final conclusion is not all that surprising. Some of the articles which have proved the most influential in the academy have not been able to reach outside the ivory tower and into the courtroom. (This author thinks that might be for the better).
Tuesday, April 22, 2008
Splits Noted: Issues concerning the Piracy of Encrypted Satellite Television Signals
- Does 47 U.S.C. § 605(e)(4) Apply to end-users of Piracy Devices?
- Does a District Court Have Discretion Not To Award Damages For Piracy of an Encrypted Satellite Signal Under the Wiretap Act?
Per DIRECTV, Inc. v. Rawlins, 2008 WL 1777856, *7-*10 (4th Cir. Apr. 21, 2008)
With the coverage of this case, this blog has now covered a case from every circuit court capable of creating or noting a circuit split. It has also had visitors from every inhabited continent, and over 1,300 unique visitors. The most visitors continue to come from the U.S. Courts. I want to thank again those who have helped me start up, particularly Appellate Law & Practice, California Blog of Appeal, Decision of the Day, Obsidian Wings, Sentencing Law & Policy, and Southern Appeal. Please visit those blogs (links on the side) to help me thank them.
DIRECTV has been vigilant in pursuing actions against those who pirate its satellite television signal, instituting legal action against more than 25,000 defendants (see here). It commenced the instant action against defendant Rawlins after discovering evidence that he had purchased five devices enabling Rawlins to watch DIRECTV programming without paying for a subscription. DIRECTV alleged violations of the Cable Act and the Wiretap Act. After Rawlins failed to appear, DIRECTV moved for default judgment including a permanent injunction, statutory damages, attorneys’ fees, and costs. The district court granted summary judgment, entered an injunction, awarded DIRECTV costs and fees, but denied statutory damages under either Act. DIRECTV only appealed the denial of damages under the Wiretap Act.
Nonetheless, Judge Duncan considers the history and provisions of both acts as they apply to this case. The Cable Act proscribes the unauthorized reception of an encrypted satellite signal by end users, 47 U.S.C. § 605(a), and the manufacture, assembly, modification, importation, exportation, sale, or distribution of piracy devices or equipment, 47 U.S.C. § 605(e)(4). The former provision is punishable by statutory damages of not less than $1,000 and not more than $10,000, whereas the latter provision is punishable by statutory damages of not less than $10,000 and not more than $100,000. 47 U.S.C. § 605(e)(3)(C)(i)(II). Any award of damages is subject to the discretion of the district court.
The panel, unanimous on this point, notes that the circuits have split on the question of whether § 605(e)(4) may be applied to end-users (CA 4,5) or is limited to upstream manufacturers (CA 9, several district courts). In this case, the district court denied summary judgment to DIRECTV on its claim under § 605(e)(4), finding that that section was limited to upstream manufacturers. Even though the trial judge did not mention the contrary Fourth Circuit precedent on this issue, the panel does not address it because DIRECTV did not appeal the failure to award damages under the Cable Act.
Pirating a satellite signal also violates the Wiretap Act, which forbids the interception of any wire, oral, or other electronic communication. 18 U.S.C. § 2511(1)(a). Like the Cable Act, the Wiretap Act provides a civil remedy to those harmed by violations of its provisions. 18 U.S.C. § 2520. The statute provides for mandatory damages for the piracy of non-encrypted satellite communications in an amount ranging from $50-$1000. 18 U.S.C. § 2520(c)(1). For the theft of encrypted satellite communications, the statute provides for discretionary statutory damages in amount of $10,000 or $100 per day for each day of violation, whichever is greater. 18 U.S.C. § 2520(c)(2).
As this case concerns the piracy of DIRECTV’s encrypted signal, the latter provision applies. Judge Duncan notes that, despite the statute’s permissive language (“may”), the circuits have split over whether the award of damages under § 2520(c)(2) is discretionary. The CAs 4,6,8,11 all hold that it is discretionary, whereas the CA 7 requires a court to award damages.
Having thus concluded that the decision to award damages under either act lies within a district court’s discretion, the panel concludes the trial judge in this case abused his discretion by considering legally irrelevant factors. It therefore remands to the district court to consider whether damages under the Wiretap Act would be appropriate in light of the relevant concerns.
Split Widened: Does The Petroleum Marketing Practices Act Permit Claims For Constructive Non-Renewal of Franchise Agreements?
Per Marcoux v. Shell Oil Prods. Co. LLC, 2008 WL 1759157, (1st Cir. Apr. 18, 2008)
Eight Shell franchisees brought suit against Shell for violations of the Petroleum Marketing Practices Act (PMPA). In 1998, Shell transferred franchise agreements to Motiva, a joint venture with Texaco and Star Enterprises. Motiva then changed the rent provisions in the contract, which included a discount based on the amount of gasoline sold above a threshold. This subsidy had been in effect since 1982, although the threshold and discount amount had changed from time to time. The terms of the subsidy explicitly provided for cancellation on thirty days notice, but various representations were made to the franchisees that the subsidy would always exist. Motiva ended the subsidy entirely in 2000, and offered new leases with higher rent. The dealers signed the new leases under protest, and then filed the instant suit.
The First Circuit upholds the jury verdict that cancellation of the subsidy amounted to constructive termination of franchise contracts. It overturns the jury’s finding that the new leases constituted constructive non-renewal in violation of PMPA. The unanimous panel notes that the circuits have split on whether the PMPA even permits constructive non-renewal claims (CA 9), or instead requires a franchisee to receive a notice of non-renewal (CA 5,7, and now 1). Judge Howard finds that the franchisee’s ratification of the new leases precludes any claim of constructive non-renewal. He expresses some discomfort with this result, but finds that it is what the language of the statute requires.
As Appellate Law & Practice notes, this opinion is also notable for those interested in civil procedure as well as gas-gouging. The court permitted substitution of the plaintiffs after the statute of limitations had run by relating the claims back to the original suit. The court also found that Shell did not exercise good faith in setting its prices.
Eight Shell franchisees brought suit against Shell for violations of the Petroleum Marketing Practices Act (PMPA). In 1998, Shell transferred franchise agreements to Motiva, a joint venture with Texaco and Star Enterprises. Motiva then changed the rent provisions in the contract, which included a discount based on the amount of gasoline sold above a threshold. This subsidy had been in effect since 1982, although the threshold and discount amount had changed from time to time. The terms of the subsidy explicitly provided for cancellation on thirty days notice, but various representations were made to the franchisees that the subsidy would always exist. Motiva ended the subsidy entirely in 2000, and offered new leases with higher rent. The dealers signed the new leases under protest, and then filed the instant suit.
The First Circuit upholds the jury verdict that cancellation of the subsidy amounted to constructive termination of franchise contracts. It overturns the jury’s finding that the new leases constituted constructive non-renewal in violation of PMPA. The unanimous panel notes that the circuits have split on whether the PMPA even permits constructive non-renewal claims (CA 9), or instead requires a franchisee to receive a notice of non-renewal (CA 5,7, and now 1). Judge Howard finds that the franchisee’s ratification of the new leases precludes any claim of constructive non-renewal. He expresses some discomfort with this result, but finds that it is what the language of the statute requires.
As Appellate Law & Practice notes, this opinion is also notable for those interested in civil procedure as well as gas-gouging. The court permitted substitution of the plaintiffs after the statute of limitations had run by relating the claims back to the original suit. The court also found that Shell did not exercise good faith in setting its prices.
Split Noted: Can Events After the Filing of a Class Action Suit Affect Its Removal?
Per Springman v. AIG Marketing, Inc., 2008 WL 1722153, *3 (7th Cir. Apr. 15, 2008)
In July 2003, Plaintiff Springman filed a class action suit in an Illinois state court against AIG Claim Services, Inc, alleging fraudulent claims processing. AIG Claim Services responded to an interrogatory in December 2003 by stating that it had not handled Sprigman’s claims. Almost a year later, Springman finally asked who handled his claim and was informed that the processor was AIG Marketing, Inc. Finally, Springman amended his complaint to aid AIG Marketing and drop AIG Claim Services almost three years after discovering that AIG Marketing was responsible for the allegedly fraudulent claims processing.
In between the suits initial filing and the amended complaint, however, Congress passed the Class Action Fairness Act, which allows removal of some class actions to federal court despite the lack of complete diversity. This act applies to any suit commenced on or after the Act’s effective date. The question is whether the substitution of the parties constitutes a ‘commencement’ of a suit against AIG Marketing within the meaning of the CAFA.
Judge Posner, on behalf of a unanimous panel, notes that the circuits are split on this issue. The majority (the CAs 5,6,7,8,10) hold that actions after the filing of a suit can affect removal, whereas the CA 9 only looks to the suit as initially filed. The majority school does apply the ‘relation-back’ doctrine to determine if the substitution of parties (or other changes) so relates back to the initial suit as not to commence a new suit. That doctrine does not apply here because of Plaintiff Springman’s inexplicable delay in amending his complaint. Therefore, the substitution of the parties commenced a new suit, which can be removed under the CAFA.
In July 2003, Plaintiff Springman filed a class action suit in an Illinois state court against AIG Claim Services, Inc, alleging fraudulent claims processing. AIG Claim Services responded to an interrogatory in December 2003 by stating that it had not handled Sprigman’s claims. Almost a year later, Springman finally asked who handled his claim and was informed that the processor was AIG Marketing, Inc. Finally, Springman amended his complaint to aid AIG Marketing and drop AIG Claim Services almost three years after discovering that AIG Marketing was responsible for the allegedly fraudulent claims processing.
In between the suits initial filing and the amended complaint, however, Congress passed the Class Action Fairness Act, which allows removal of some class actions to federal court despite the lack of complete diversity. This act applies to any suit commenced on or after the Act’s effective date. The question is whether the substitution of the parties constitutes a ‘commencement’ of a suit against AIG Marketing within the meaning of the CAFA.
Judge Posner, on behalf of a unanimous panel, notes that the circuits are split on this issue. The majority (the CAs 5,6,7,8,10) hold that actions after the filing of a suit can affect removal, whereas the CA 9 only looks to the suit as initially filed. The majority school does apply the ‘relation-back’ doctrine to determine if the substitution of parties (or other changes) so relates back to the initial suit as not to commence a new suit. That doctrine does not apply here because of Plaintiff Springman’s inexplicable delay in amending his complaint. Therefore, the substitution of the parties commenced a new suit, which can be removed under the CAFA.
Monday, April 21, 2008
Split Widened: Does The Mailbox Rule Apply In Tax Cases?
Per Phila. Marine Trade Ass’n-Int’l Longshoremens’ Ass’n Pension Fund v. Comm’r., 2008 WL 1722730, *16-*33 (3d Cir. Apr. 15, 2008)
The Pension Fund collects contributions under various collective bargaining agreements between the trade association and locals of the Longshoremens’ unions. It is required to remit payroll and income taxes to the IRS from the moneys it distributes. In 2001, the IRS notified the O’Neill, the company in charge of administrating the Fund, of various filing errors, and assessed a levy against the Fund. This levy was only discovered by O’Neill during an audit 2003, after the employee who had received the notification had left the company. O’Neill then mailed two requests for a refund, but only has a record of the mailing on June 13, 2003. The IRS has no record of receiving either letter.
The Fund, O’Neill, and the IRS held various discussions throughout the summer. After these negotiations failed to produce an agreement, the Fund formally filed for (how’s that for alliteration) a refund in September 2003. The IRS refunded a portion of the levy, but declined to refund the full amount because the statute of limitations to request a refund on the remainder expired on June 25, 2003.
The common-law mailbox rule is that if a document is properly mailed, a court will presume that it was delivered to the addressee in the usual time. Section 7502 of the Internal Revenue Code makes the date of the postmark of any tax filing the equivalent delivery date. In effect, this section speeds up the common-law mailbox rule – instead of delivery in the usual time, this section authorizes an assumption of instantaneous receipt. Subsection c, which only applies to § 7502, makes registered mail prima facie evidence of delivery at the time of the postmark.
The question is whether Congress intended this section to entirely preempt the common law mailbox rule, or merely to provide additional protections. Judge Ambro, on behalf of a unanimous panel, holds that where, as in this case, the taxpayer does not need to rely on § 7502 and has offered external evidence of mailing, the common-law mailbox rule continues to apply. The panel noted that it would be illogical to read a statute conferring additional protections to be, sub silentio, repealing others. Furthermore, Congress needs to be explicit and clear when it is repealing common law protections. In so holding the CA 3 widens a split between the CAs 8,9,10 (so holding) and the CAs 2,6 (finding that § 7502 is exclusive).
This tax decision was delivered (pun intended) on tax day. Although, as noted above, it widens an already well-developed split of authority in the circuits, it is not a likely certiorari candidate. The Department of the Treasury has proposed a regulation that, if adopted, would clearly preempt the mailbox rule in all future cases, regardless of the circuit. 69 Fed. Reg. 56,377.
The Pension Fund collects contributions under various collective bargaining agreements between the trade association and locals of the Longshoremens’ unions. It is required to remit payroll and income taxes to the IRS from the moneys it distributes. In 2001, the IRS notified the O’Neill, the company in charge of administrating the Fund, of various filing errors, and assessed a levy against the Fund. This levy was only discovered by O’Neill during an audit 2003, after the employee who had received the notification had left the company. O’Neill then mailed two requests for a refund, but only has a record of the mailing on June 13, 2003. The IRS has no record of receiving either letter.
The Fund, O’Neill, and the IRS held various discussions throughout the summer. After these negotiations failed to produce an agreement, the Fund formally filed for (how’s that for alliteration) a refund in September 2003. The IRS refunded a portion of the levy, but declined to refund the full amount because the statute of limitations to request a refund on the remainder expired on June 25, 2003.
The common-law mailbox rule is that if a document is properly mailed, a court will presume that it was delivered to the addressee in the usual time. Section 7502 of the Internal Revenue Code makes the date of the postmark of any tax filing the equivalent delivery date. In effect, this section speeds up the common-law mailbox rule – instead of delivery in the usual time, this section authorizes an assumption of instantaneous receipt. Subsection c, which only applies to § 7502, makes registered mail prima facie evidence of delivery at the time of the postmark.
The question is whether Congress intended this section to entirely preempt the common law mailbox rule, or merely to provide additional protections. Judge Ambro, on behalf of a unanimous panel, holds that where, as in this case, the taxpayer does not need to rely on § 7502 and has offered external evidence of mailing, the common-law mailbox rule continues to apply. The panel noted that it would be illogical to read a statute conferring additional protections to be, sub silentio, repealing others. Furthermore, Congress needs to be explicit and clear when it is repealing common law protections. In so holding the CA 3 widens a split between the CAs 8,9,10 (so holding) and the CAs 2,6 (finding that § 7502 is exclusive).
This tax decision was delivered (pun intended) on tax day. Although, as noted above, it widens an already well-developed split of authority in the circuits, it is not a likely certiorari candidate. The Department of the Treasury has proposed a regulation that, if adopted, would clearly preempt the mailbox rule in all future cases, regardless of the circuit. 69 Fed. Reg. 56,377.
Subscribe to:
Posts (Atom)