U.S. Second Circuit - The FindLaw 2nd Circuit Court of Appeals Opinion Summaries Blog

April 2010 Archives

Salinger v. Colting, No. 09-2878, concerned an action by the estate of J.D. Salinger claiming copyright infringement and unfair competition based on the publication of a novel derivative of The Catcher in the Rye.  The court of appeals vacated a preliminary injunction in favor of plaintiff, holding that the Supreme Court's decision in eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388 (2006), which articulated a four-factor test as to when an injunction may issue, applied with equal force to preliminary injunctions issued on the basis of alleged copyright infringement.

As the court wrote:  "Salinger published The Catcher in the Rye (hereinafter "Catcher") in 1951. Catcher is a coming-of-age story about a disaffected sixteen-year-old boy, Holden Caulfield, who after being expelled from prep school wanders around New York City for several days before returning home. The story is told from Holden's perspective and in his "own strange, wonderful, language." Nash Burger, Books of the Times, N.Y. Times, July 16, 1951. Holden's adventures highlight the contrast between his cynical portrait of a world full of "phonies" and "crooks" and his love of family, particularly his younger sister Phoebe and his deceased younger brother Allie, along with his developing romantic interest in a childhood friend, Jane Gallagher. While his affection for these individuals pushes him throughout the novel toward human contact, his disillusionment with humanity inclines him toward removing himself from society and living out his days as a recluse. He ultimately abandons his decision to live as recluse when Phoebe insists on accompanying him on his self-imposed exile."

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Arista Records LLC v. Doe 3, No. 09-0905, concerned defendant's appeal from the denial of defendant's motion to quash a subpoena served on an Internet service provider seeking the identities of people who illegally downloaded music.  The Second Circuit affirmed, holding that 1) the motion to quash the subpoena was not dispositive of the underlying action; 2) to the extent that anonymity is used to mask copyright infringement or to facilitate such infringement by other persons, it is unprotected by the First Amendment; and 3) defendant's expectation of privacy for sharing copyrighted music through an online file-sharing network was simply insufficient to permit him to avoid having to defend against a claim of copyright infringement.

Continental Ins. Co. v. Atlantic Ins. Co., No. 09-2882, involved an action against an insurer under New York Insurance Law Section 3420(a) for satisfaction of a default judgment against the insured.  The court of appeals affirmed summary judgment for defendant, on the ground that an exclusionary provision in the liability insurance policy barred coverage of the fire.

In re: Ciprofloxacin Hydrochloride Antitrust Litigation, No. 05-2851, concerned an action claiming that defendant pharmaceutical companies violated Section 1 of the Sherman Act when they settled their dispute concerning the validity of Bayer's Cipro patent by agreeing to a reverse exclusionary payment settlement.  The Second Circuit affirmed summary judgment for defendants, on the ground that patent settlements in which the generic firm agrees to delay entry into the market in exchange for payment fall within the scope of the patent holder's property rights.

US v. Moskowitz, Passman & Edelman, No. 08-3017, involved an action by the U.S. to enforce a tax levy against defendant law firm.  The Second Circuit affirmed judgment for the U.S., holding that the firm was obligated by the IRS's continuing levy on the partner's "salary," 26 U.S.C. section 6331(e), to surrender to the government the funds that it instead paid to the partner as "draws."

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Debeatham v. Holder, No. 09-0205, concerned a petition for review of the denial of petitioner's motion to reopen his removal proceedings.  The court of appeals denied the petition on the ground that petitioner failed to comply with the requirements of In re Lozada, 19 I. & N. Dec. 637, 639 (B.I.A. 1988), in asserting one of counsel's alleged errors and failed to show prejudice arising from the remaining alleged errors.

US v. Key, No. 08-3218, involved defendant's appeal from the denial of his motion for a reduction of sentence under 18 U.S.C. section 3582(c)(2).  The Second Circuit dismissed the appeal on the ground that, even the court were to reverse the district court's denial of defendant's motion for a reduction of sentence, the possibility that the district court would, on remand, terminate defendant's supervised release under 18 U.S.C. section 3583(e)(1) was too remote and speculative to satisfy the case-or-controversy requirement of Article III, Section 2 of the Constitution.

Wasser v. N.Y. State Offc. of Vocational and Educ. Servs., No. 08-4724, concerned a Rehabilitation Act action based on failure to accommodate plaintiff's muscular dystrophy.  The Second Circuit affirmed the dismissal of the complaint on the ground that, when a plaintiff commences a civil action under 29 U.S.C. section 722(c)(5)(J), seeking review of a final decision of either a state hearing officer or a state reviewing official, district courts should apply a modified de novo standard of review, engaging in an independent review of the administrative record while according substantial deference to the policy views of the New York State Office of Vocational and Educational Services for Individuals with Disabilities and the findings of state administrative proceedings.

Baker & Taylor, Inc. v. Alphacraze.com Corp., No. 09-0581, involved an action alleging breach of contract, breach of guaranty, unjust enrichment, quantum meruit, and fraudulent conveyance arising from contracts and guaranties between plaintiffs and various of defendants.  The court of appeals vacated the dismissal of the action on the grounds that 1) neither of the signatories to the arbitration agreement at issue here sought arbitration; and 2) the nonsignatory defendants who did move to dismiss in favor of arbitration, moreover, disclaimed any interest in participating in the arbitration and stated that they could not be compelled to arbitrate plaintiffs' claims.

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Civil Rights, Copyright, Criminal, Securities and Tax Matters

Pacific Inv. Mgmt. Co. v. Mayer Brown LLP, No. 09-1619, concerned a securities fraud action against outside counsel for a corporation that allegedly made false statements in connection with a securities offering.  The court of appeals affirmed the dismissal of the complaint, on the grounds that 1) a secondary actor can be held liable for false statements in a private damages action for securities fraud only if the statements were attributed to the defendant at the time the statements were disseminated; and 2) plaintiffs' claims that defendants participated in a scheme to defraud investors were not meaningfully distinguishable from the claim at issue in Stoneridge Inv. Ptnrs., LLC v. Scientific-Atlanta, Inc., 552 U.S. 148 (2008).

Oneida Indian Nation v. Madison Cty., No. 05-6408, involved an action by the Oneida Indian Nation of New York (the "OIN") against Madison and Oneida Counties to enjoin them from foreclosing on OIN-owned property for non-payment of taxes.  The Second Circuit affirmed summary judgment for plaintiff, on the ground that the OIN was immune from the counties' foreclosure actions under the principle that, "as a matter of federal law, an Indian tribe was subject to suit only where Congress authorized the suit or the tribe had waived its immunity."

Bryant v. Media Right Prods., Inc., No. 09-2600, concerned a copyright infringement action based on the copying and sale of plaintiffs' music albums without authorization.  The court of appeals affirmed judgment for plaintiffs, on the grounds that 1) the district court correctly awarded statutory damages for each album infringed; 2) the district court did not commit clear error in finding that plaintiffs had failed to prove willfulness and that defendant had proven its innocence; and 3) the district court did not err in calculating damages.

Bridgeport Guardians, Inc. v. Delmonte, No. 09-1063, involved plaintiff-police officers' appeal from the denial of their motion to intervene in a Title VII action filed by African-American officers.  The court of appeals reversed, holding that intervenors had an interest in their employers' employment practices and, therefore, a settlement agreement that they asserted infringed their statutory and constitutional rights, and hence they asserted an interest in their promotion that was sufficient for intervention.

In US v. Cerna, No. 09-1170, the Second Circuit vacated defendant's conviction for illegal reentry into the U.S., on the grounds that 1) the district court's factual finding that defendant knowingly and intelligently waived his right to appeal his deportation order and so failed to exhaust his administrative remedies as required by 8 U.S.C. section 1326(d)(1) was clearly erroneous; and 2) ineffective assistance of counsel may be grounds to excuse the requirement of 8 U.S.C. § 1326(d)(1) that a defendant charged with illegal reentry who brings a collateral challenge to the prior deportation order must have exhausted administrative remedies in the immigration proceeding.

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Guest v. Hansen, No. 08-4642, involved a wrongful death action based on a snowmobile crash on defendant college's property.  The court of appeals affirmed summary judgment for defendant, holding that 1) an administrator of an estate may represent an estate pro se, so long as the estate has no other beneficiaries; and 2) even assuming arguendo that the college had the ability to control off-campus social activities, it was under no obligation to do so.

Greenwich Fin. Servs. Distressed Mortgage Fund 3 LLC v. Countrywide Fin. Corp., No. 09-3660, concerned defendants' appeal from the district court's grant of plaintiffs' motion to remand plaintiffs' securities class action to state court.  The court of appeals dismissed the appeal, on the ground that the fact that plaintiffs sought enforcement of a term of the pooling and servicing agreements at issue - trust agreements similar to bond indentures in many respects - did not affect the court's conclusion that the suit was not removable under the Class Action Fairness Act.

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Harrington v. Atlantic Sounding Co., No. 07-4272

Harrington v. Atlantic Sounding Co., No. 07-4272, involved a personal injury action arising out of injuries sustained by plaintiff-seaman.  The court of appeals vacated the district court's order denying defendants' motion to dismiss or, in the alternative, to stay the district court action and compel arbitration, holding that section 6 of the Federal Employer's Liability Act did not apply to seamen's arbitration agreements, and thus the arbitration agreement was not unenforceable as a matter of law, and the district court's finding that the arbitration agreement was unenforceable due to unconscionability was erroneous.

As the court wrote:  "Plaintiff-Appellee Frederick J. Harrington, Jr., ("Harrington") filed this action in the United States District Court for the Eastern District of New York (Nina Gershon, Judge), against Defendants-Appellants Atlantic Sounding Co., Inc., Weeks Marine, Inc. (Atlantic Sounding's corporate parent), and the vessel MV CANDACE (collectively, "Defendants") pursuant to the Jones Act, 46 U.S.C. § 688, seeking recovery for injuries sustained while he was employed as a seaman on the CANDACE. Defendants sought to dismiss the complaint or, in the alternative, to compel arbitration and to stay the district court action, pursuant to a post-injury arbitration agreement between the parties. Harrington opposed Defendants' motion, arguing that the arbitration agreement, which he signed in return for cash advances against his claim, was unenforceable as the result of intoxication and lack of mental capacity, and because the agreement was unconscionable."

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Full Text of Harrington v. Atlantic Sounding Co., No. 07-4272

Civil Procedure, Criminal and Immigration Matters

Rosario v. Ercole, No. 08-5521, involved a murder prosecution in which the trial court denied petitioner's habeas petition.  The court of appeals affirmed, on the ground that the trial court conducted a thorough hearing, assessing the credibility of the potential witnesses first-hand, in denying petitioner's ineffective assistance claim, and petitioner did not rebut those findings by clear and convincing evidence.

Shabaj v. Holder, No. 09-0558, concerned a petition for review of the BIA's order removing petitioner from the U.S.  The Second Circuit denied the petition, on the ground that petitioner's removal order was premised on his entry as an Italian national under the Visa Waiver Program, which waived any defense to removal other than asylum, and his removal was properly administered under that program.

Lora v. O'Heaney, No. 09-3690, involved a 42 U.S.C. section 1983 action based on abuse plaintiff allegedly suffered while in a correctional facility.  The Second Circuit dismissed defendants' appeal from the denial of qualified immunity, on the grounds that 1) the appeal from an untimely motion for reconsideration pursuant to Rule 59(e) of the Federal Rules of Civil Procedure did not bring up for review the merits of the underlying order; and 2) the appeal from a denial of a motion for reconsideration did not satisfy the requirements of the collateral order doctrine.

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In re: Kalikow, No. 08-5268, involved creditors' appeal from the district court's affirmance of the bankruptcy court's order granting former debtors' motion to reopen Chapter 11 proceedings, impose sanctions against creditors, and award costs and fees to debtors.  The Second Circuit affirmed in part on the grounds that 1) proper service on creditors' law firm constituted proper service on them; and 2) the district court did not err in concluding that the debtor's Enforcement Motion did not seek a new injunction but, rather, sought to enforce an injunction already in place -- one that was created by sections 1141 and 524 of the Bankruptcy Code and the express terms of the Plan and Confirmation Order.  However, the court reversed in part, holding that the creditors were not holders of pre-confirmation claims discharged in bankruptcy who would normally be bound by the provisions of the Plan, and thus the sanctions awarded against them were improper.

Guirlando v. T.C. Ziraat Bankasi A.S., No. 09-0478, involved an action for negligence and breach of fiduciary duty in enabling plaintiff's husband to withdraw most of her life savings from a newly established bank account in Turkey.  The Second Circuit affirmed the dismissal of the complaint, holding that the bank was immune from suit under the Foreign Sovereign Immunities Act because none of defendant bank employees' acts, while in Turkey, of 1) telling plaintiff that she could not open an individual checking account, 2) causing her to open a disjunctive joint account from which funds could be withdrawn by one joint owner without the consent of the other, and 3) notifying plaintiff's husband, rather than plaintiff, when the funds had arrived in the new account, had a "direct effect" in the U.S.

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Copyright and Immigration Matters

Sumbundu v. Holder, No. 07-3736, involved a petition for review of the BIA's decision affirming an Immigration Judge's (IJ) denial of cancellation of removal on the grounds that petitioners lacked moral character under the "catchall" provision of 8 U.S.C. section 1101(f).  The Second Circuit denied the petition, holding that 1) the court had jurisdiction because petitioners raised constitutional claims or questions of law; but 2) intent to commit misconduct was relevant to an IJ's decision that a petitioner lacks good moral character; and 3) misrepresenting a "substantial sum" on a tax return may certainly be a factor in the IJ's moral character determination.

Peter F. Gaito Architecture, LLC v. Simone Dev. Corp., No. 09-2613, concerned a copyright infringement action based on the alleged copying of architectural plans.  The court of appeals affirmed the dismissal of the complaint, on the ground that the district court properly considered the question of non-infringement on defendants' motion to dismiss, and did not err in concluding that the complaint -- together with those documents incorporated therein -- failed to adequately allege substantial similarity between defendants' work and the protectible elements of plaintiffs' work.

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Attorney Discipline, False Claims Act and Insurance Law Matters

In In re: Roman, No. 08-9002, the Second Circuit publicly reprimanded an attorney, reciprocally suspended him for a six-month period based on a prior suspension imposed by the Ninth Circuit, and suspended him for an additional one-month period based on his misconduct in the Second Circuit, on the grounds that 1) the mitigating factors in this case, considered together, did not amount to a grave reason justifying a suspension different than that imposed by the Ninth Circuit; and 2) the court did not see complete overlap between the conduct addressed by the Ninth Circuit and that addressed in the present order.

US ex rel. Kirk v. Schindler Elevator Corp., No. 09-1678, concerned a False Claims Act (FCA) action alleging that plaintiff's former employer obtained government contracts while representing that it had filed certain required Vietnam Era Veterans Readjustment Assistance Act (VEVRAA) reports, when in fact it either had failed to file a report or had filed a false report for the relevant years.  The court of appeals vacated the dismissal of the complaint, holding that 1) a document obtained in response to a request made under the Freedom of Information Act qualified as an enumerated source triggering the jurisdictional bar of the FCA only when the document itself was a "congressional, administrative, or Government Accounting Office report, hearing, audit, or investigation," and the documents obtained by plaintiff through FOIA did not fall within any of these categories; and 2) plaintiff's complaint stated valid claims under the FCA when it alleged that defendant had entered into contracts with the federal government while not in compliance with the VEVRAA.

Fabozzi v. Lexington Ins. Co., No. 09-0727, concerned an action to recover proceeds under a homeowners' insurance policy based on structural damage to plaintiffs' home.  The Second Circuit vacated summary judgment for defendant, holding that, under longstanding New York law, the limitations period did not begin to run until plaintiffs' claim against defendant accrued, rather the date of the accident.

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Criminal Matters

US v. Kyles, No. 06-4196, involved defendant's appeal from the district court's orders amending his restitution schedule while he was incarcerated.  The court of appeals affirmed in part, holding that although the Victim and Witness Protection Act did not expressly confer such authority, it inhered in the authority that statute conferred on district courts to permit an award of restitution to be paid in periodic installments, rather than immediately.  However, the court vacated the orders in part insofar as they provided for increases in defendant's restitution schedule in accordance with the Inmate Financial Responsibility Program, because that was an impermissible delegation of judicial power to the Bureau of Prisons.

Ramchair v. Conway, No. 08-2004, concerned the state's appeal from the district court's order granting a writ of habeas corpus to the petitioner on the ground of ineffective assistance of state appellate counsel, and ordering a new trial.  The Second Circuit affirmed on the ground that appellate counsel's failure to raise petitioner's mistrial claim was not a sound strategic decision, but a mistake based on counsel's misunderstanding that the mistrial claim, which trial counsel explicitly made, had not been preserved.

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Contract and Trademark Matters

Israel v. Chabra, No. 06-1467, involved an action to enforce an agreement guaranteeing a debt.  The court of appeals vacated judgment for plaintiff, holding that the Consent Clause of the agreement constituted advance consent to the Second Amendment establishing a new payment schedule for the debt, defendant's obligations as Guarantor were not discharged by the adoption of the Second Amendment, and the payment schedule in the Second Amendment controlled.

Tiffany (NJ) Inc. v. eBay Inc., No. 08-3947, involved an action by Tiffany Inc. against eBay based on sales of counterfeit Tiffany merchandise on eBay, alleging trademark infringement, false advertising, and trademark dilution.  The Second Circuit affirmed judgment for defendant in part, on the grounds that 1) a defendant may lawfully use a plaintiff's trademark where doing so is necessary to describe the plaintiff's product and does not imply a false affiliation or endorsement by the plaintiff of the defendant; 2) for contributory trademark infringement liability to lie, a service provider must have more than a general knowledge or reason to know that its service is being used to sell counterfeit goods, and some contemporary knowledge of which particular listings are infringing or will infringe in the future is necessary; and 3) there was no second mark or product at issue here to blur with or to tarnish "Tiffany."  However, the court vacated in part as to plaintiff's false advertising claim, because the district court failed to determine whether extrinsic evidence indicates that the challenged advertisements were misleading or confusing.

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