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NEW & NOTEWORTHY

  
  • The U.S. Supreme Court issued two new opinions on April 2, 2014.

    In one of the most highly awaited decisions of the term, the Court struck down one prong of the campaign finance laws that limited the aggregate amount of money that a donor could contribute is a single campaign season. Specifically, the law limited the aggregate amount that a donor to contribute to $48,600 to federal candidates and $74,600 to committees. In McCutcheon v. FEC, the five-justice majority, in an opinion by Chief Justice Roberts, held that this aggregate limit was unconstitutional under the First Amendment, and did not sufficiently serve the governmental interest of preventing corruption or the appearance of corruption to override the First Amendment interests —specifically quid pro quo corruption. Justice Thomas, in concurrence, stated that he would have gone farther and overruled Buckley v. Valeo (which held that base limits were constitutional) entirely. Justice Breyer, joined by Justices Ginsburg, Sotomayor, and Kagan, dissented, arguing that the Court’s holding will create a loophole that will enable political corruption, which the dissenters defined more broadly as “privileged access” and “pernicious influence.”

    The opinion is here.

    After an airline cancelled a customer’s membership in its frequent flyer program for, as allowed in the airline’s sole discretion under the terms of that program, “abusing” the benefits, that customer sued under state law claiming a breach of the duty of good faith and fair dealing. The district court dismissed the claim on the basis that it was pre-empted under the Airline Deregulation Act of 1978, 49 U.S.C. sec. 41713. The Court, in Northwest, Inc. v. Ginsburg, affirmed that holding in a unanimous opinion authored by Justice Alito, since the customer’s good faith and fair dealing claim sought to enlarge the terms of the frequent flyer program agreement. Where State law does not allow for parties to contract out of the covenant of good faith and fair dealing, such a claim will always be pre-empted under the Act.

    A link to the opinion is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • The case of Citizens for Responsibility and Ethics in Washington v. Dept. of Justice involved a request under the Freedom of Information Act regarding the investigation of former Rep. Tom DeLay by DOJ, in which the agency declined to produce any of those documents under several bases, including that DeLay himself had a substantial privacy interest that weighed against disclosure. The district court ruled for DOJ, holding that it was categorically inappropriate for those documents to be released given DeLay’s privacy interest and the “minimal public interest” at stake. The U.S. Circuit Court of Appeals for the D.C. Circuit, in a unanimous decision authored by Judge Henderson released on April 1, 2014, reversed that judgment and held that no such categorical test was appropriate in this instance. Rather, the agency must make a particularized showing as to each withheld document whether it qualifies under an exemption. The panel also found DOJ’s support for other stated exemptions to be insufficient, and remanded for further proceedings.

    The opinion is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • In Pliler v. Stearns, the U.S. Court of Appeals for the Fourth Circuit joined the Sixth, Eighth, Ninth, and Eleventh Circuits in holding that above-median-income debtors with negative disposable income are obligated to maintain Chapter 13 bankruptcy plans for a full five years under the temporal requirement in 11 U.S.C. sec. 1325(b), where the plan does not pay unsecured creditors in full. Judge Wynn, for the unanimous panel, held that an above-median-income debtor could not request early termination of a Chapter 13 plan unless all unsecured creditors were paid in full irrespective of the debtor’s projected disposable income.

    The opinion is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • On March 26, 2014, the U.S. Supreme Court resolved a split between the Circuits and held that a man’s conviction for having “intentionally or knowingly cause[d] bodily injury to” the mother of his child constituted a “misdemeanor crime of domestic violence” that thereby prohibited him from possessing a firearm under 18 U.S.C. sec. 922(g)(9), even though one could cause bodily injury without using any force whatsoever. Justice Sotomayor, writing for a unanimous Court, rejected the argument that sec. 922(g)(9) required that the prior conviction involve “violent contact” or “physical force” in order to be properly qualified as “domestic violence.” Justice Scalia, in a concurrence, stated that he would read the statute more narrowly under Johnson v. United States, 559 U.S. 133 (2010), but otherwise joined in the judgment. Justice Alito, joined by Justice Thomas, concurred in the judgment only, and argued that Johnson’s reasoning should not be extended to this case for reasons stated in his dissent thereto.

    The opinion is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • The U.S. Supreme Court issued two opinions on March 25, 2014.

    In United States v. Quality Stores, Inc., a unanimous Court, in a decision by Justice Kennedy, held that severance payments made to employees terminated against their will are taxable wages under the Federal Insurance Contributions Act (FICA), 26 U.S.C. sec. 3101 et seq., resolving a circuit split. The Court relied on FICA’s broad definition of wages, and rejected the definition provided under 26 U.S.C. sec. 3402(o). Justice Kagan did not participate in the decision.

    The opinion is here.

    The Lanham Act allows civil suits for false association and false advertising, but the Circuits were split as to how to determine who had standing to file such a suit. In this case, a company that sells components necessary for the remanufacturing of Lexmark’s printer cartridges sued Lexmark for false advertising, and the Sixth Circuit found that the component-maker had standing under the Second Circuit’s “reasonable interest” approach. In a unanimous opinion by Justice Scalia, the Court, in Lexmark Intl., Inc. v. Static Control Components, Inc., held that courts should apply the “zone of interests” test, requiring that a plaintiff allege an injury to a commercial interest in reputation or sales that was proximately caused by a violation of the Act. In so holding, the Court rejected the “prudential standing” balancing test, the “reasonable interest” test, and the “categorical” test that the Circuits had developed. The Court then analyzed the claims brought by the component-maker and found that it had properly stated a claim under the Act, and so affirmed the Sixth Circuit’s holding (though not its reasoning).

    The opinion is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • VA Court of Appeals: Car Air Freshener Supplies Probable Cause to Stop

    If you have one of those pine-tree shaped air fresheners hanging from your rear-view mirror that is about three inches long and three inches wide at the base, that is enough to give any Virginia officer probable cause to stop your car for being in violation of Va. Code sec. 46.2-1054 (prohibiting items that obstruct the driver’s clear view of the road from being hung by the rear-view mirror). In Richardson v. Commonwealth, the officer pulled over the offending car, smelled marijuana smoke, and a bag of cocaine fell from the driver’s pants leg after the ensuing search. The Virginia Court of Appeals noted other jurisdictions (like the 8th Circuit) where hanging air fresheners were deemed to be probable cause for a stop, and thereby denied Richardson’s suppression motion.

    Take note of this ruling in case you have anything hanging from your rear-view mirror, fuzzy dice included.

    The opinion is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • The D.C. Court of Appeals issued two opinions of particular note on March 13, 2014.

    In Stancil v. First Mount Vernon Industrial Loan Association, the Court addressed whether a complaint by two homeowners against their lender properly stated a claim for fraudulent misrepresentation with regard to a forbearance agreement the parties had orally entered into. The forbearance agreement, which was to be reduced to writing but never was, required the homeowners to pay the lender, among other things, $100,000 to cover a liquidated attorneys’ fee, and $50,000 for actual forbearance. Despite making the payment, the lender foreclosed on the homeowners’ property soon thereafter. The homeowners filed suit alleging fraudulent misrepresentation, breach of the oral forbearance contract, and wrongful foreclosure. The Court held, in a 2-1 opinion by Judge McLeese, that the homeowners’ complaint failed to allege what the fraudulent misrepresentation was as to the attorneys’ fee payment, and so affirmed dismissal of that claim, but reversed the others. Of particular note: the Court observed that the homeowners had not argued the liquidated attorneys’ fee provision was unconscionable, and so did not address that argument, but set forth in dictum, in a lengthy footnote, “support for the suggestion that [the lender] was not entitled to receive payment in excess of the actual fees incurred.” Senior Judge Nebeker dissented in part, arguing that the claims should have all been dismissed because the homeowners could not plead facts to show detrimental reliance. A link to the opinion is here.

    In a case of first impression, the Court addressed how a tenant’s failure to pay rent is affected when the landlord augments its effort to mitigate damages by simultaneously offering the premises for sale and for rent. The Court, in a unanimous opinion by Senior Judge Ferren, held in BLT Burger DC, LLC v. Norvin 1301 CT, LLC that the sale of formerly leased property after reasonable diligence to re-let is an appropriate effort to mitigate damages, and thus does not cut off a landlord’s right to damages, effectively adopting New York’s rule over Maryland’s. That was the end of the good news for the landlord, however: the Court vacated the landlord’s $5.7 million award for the diminished value of the premises as sold because the landlord’s expert valuation was faulty in several respects, including that it used the premises’ actual income over a one-year period rather than its stabilized annual net income over a five-year period as required under case law, and effectively valued the premises as being worthless. The Court also vacated the damages award for unpaid rent pending a new diminution finding by the trial court. A link to the opinion is here.



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  • If you have one of those pine-tree shaped air fresheners hanging from your rear-view mirror that is about three inches long and three inches wide at the base, that is enough to give any Virginia officer probable cause to stop your car for being in violation of Va. Code sec. 46.2-1054 (prohibiting items that obstruct the driver’s clear view of the road from being hung by the rear-view mirror). In Richardson v. Commonwealth, the officer pulled over the offending car, smelled marijuana smoke, and a bag of cocaine fell from the driver’s pants leg after the ensuing search. The Virginia Court of Appeals noted other jurisdictions (like the 8th Circuit) where hanging air fresheners were deemed to be probable cause for a stop, and thereby denied Richardson’s suppression motion.

    The opinion is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • The U.S. Supreme Court issued two decisions on March 10, 2014.

    Back in the 19th Century, the federal government granted numerous right-of-way easements to railroads under the 1875 General Railroad Right-of-Way Act in order to encourage expansion to the West, but left unresolved was what happened if a railroad abandoned their easement: did the easement disappear, leaving the parcel unburdened, or revert back to the government? In Brandt v. United States, the Court ruled 8-1, in a decision by Chief Justice Roberts, that the easement did not revert back to the government, and thus was extinguished. The Court’s opinion turned on the 1942 case of Great Northern Railway Co. v. United States, 315 U.S. 262, in which the government argued that the Act only “granted an easement and nothing more,” and the Court agreed. Bound by its prior victory, the government loses today. Justice Sotomayor, in solo dissent, argued that two rulings of the Court prior to Great Northern compelled a different result.

    The opinion is here.

    Also, the SCOTUS declined to hear an appeal of the Virginia Supreme Court’s ruling in the Falls Church/Episcopal Church matter in which the Virginia court held that the Episcopal Church owned the historic Falls Church, instead of the conservative congregation that left the denomination. Here is the Virginia Supreme Court’s original decision.



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  • On March 6, 2014, the D.C. Court of Appeals issued an opinion applying the doctrine of res judicata to a quiet title action. In U.S. Bank, N.A. v. 1905 2nd Street NE, LLC, a debtor signed a foreclosure rescue deed for his property, which was to be recorded if he could not locate financing to pay off some debts. That deed was recorded shortly before he obtained that financing from US Bank’s predecessor in interest, pursuant to which he gave a deed of trust to secure the new loan against the same property. The debtor filed suit against the beneficiary of the foreclosure rescue deed in federal and Superior Court to challenge the deed’s enforceability—losing in both cases. Then, U.S. Bank filed suit against the beneficiary and the debtor challenging the foreclosure rescue deed. The Superior Court held that certain of the Bank’s claims were precluded by res judicata based on the debtor’s prior litigation. The Court of Appeals, in a unanimous opinion by Judge Beckwith, reversed, holding that the Bank was not in privity with the debtor, and thus the doctrine of res judicata did not apply, and the Bank’s claims survived. The opinion is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • The U.S. Supreme Court issued three opinions on March 5, 2014.

    In Lozano v. Montoya Alvarez, the Court, in a unanimous opinion by Justice Thomas, held that the Hague Convention’s one-year period to file a petition for the return of an abducted child was not subject to equitable tolling, as it was not a statute of limitations, and principles of equitable tolling are not generally applied to treaties. Justice Alito, joined by Justices Breyer and Sotomayor, concurred, noting that an American court could still, depending on the factual circumstances, award relief under the Hague Convention as though the petition had been filed within the one-year period, thus minimizing any potential abuse. The opinion is here.

    Another opinion addressing a treaty—this one an investment treaty between the U.K. and Argentina—examined whether an arbitration panel’s interpretation of the treaty’s arbitration clause was entitled to deference, or could be reviewed by the courts de novo. The treaty permits parties to arbitrate disputes provided that litigation in a local court of competent jurisdiction had taken place. In a dispute between a UK company and Argentina, the UK company demanded arbitration prior to engaging in any litigation. The parties agreed on arbitration in D.C., where the panel decided, over Argentina’s objection, that it had jurisdiction to rule because Argentina’s laws and policies had made the local litigation requirement untenable. Justice Breyer, for a seven-Justice majority, held in BG Group v. Republic of Argentina that the issue of jurisdiction was to be answered by the arbitrators, and their determination was entitled to deference, thus upholding the arbitration panel’s ruling and award. Chief Justice Roberts, joined by Justice Kennedy, argued that the local litigation clause was a condition precedent to arbitration, and thus should have been a matter for the courts to decide de novo. The opinion is here.

    The final opinion resolved a Circuit split over what proof is necessary to convict a defendant of aiding and abetting the crime of using or carrying a firearm during a crime of violence or a drug trafficking crime. The Court held, in Rosemond v. United States, that proof the defendant actively participated in the underlying drug trafficking or violent crime with advance knowledge that a confederate would use or carry a gun during the crime’s commission is sufficient to find the defendant aided and abetted the crime. Justice Kagan, for a seven-Justice majority, vacated the defendant’s conviction because the jury instructions were erroneous, as they did not require the jury to find that the defendant knew in advance one of his confederates would be armed. Justice Alito, joined by Justice Thomas, concurred with the first 12 pages of the majority opinion, but disagreed as to the remainder, arguing that the Court’s discussion about the defendant having the chance to alter or withdraw his involvement in the crime was inconsistent with case law regarding aiding and abetting a crime. The opinion is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • The U.S. Supreme Court issued two new opinions today, March 4, 2014:

    In Lawson v. FMR LLC, the Court examined the limits of whistleblower protection offered under the Sarbanes-Oxley Act of 2002, 18 U.S.C. sec. 1514A(a). The Act states: “No [public] company . . ., or any . . . contractor [or] subcontractor . . . of such company, may discharge, demote, suspend, threaten, harass, or . . . discriminate against an employee in the terms and conditions of employment because of [whistleblowing activity].” The question raised by the case was whether the statute’s protection only covered those employed by the public company itself, or whether it extend to employees of privately-held companies that worked for the public company. The Supreme Court held, 6-3, in an opinion by Justice Ginsburg, that the whistleblower protections did extend to those private company employees. Justices Scalia and Thomas concurred solely on the basis that the text of the Act called for that conclusion. Justice Sotomayor, joined by Justices Kennedy and Alito, argued in dissent that the Court’s holding gave the protections too broad a scope, potentially allowing the babysitter of a Wal-Mart employee to have a claim under the Act. The decision is here.

    As a result of a Chapter 7 debtor’s misconduct, a bankruptcy court ruled that the $75,000 he claimed as a homestead exemption be used to pay the trustee’s attorneys’ fees incurred as a result of that misconduct, even though the Bankruptcy Code states that such funds may not be used to pay any administrative expenses, including attorneys’ fees. 11 U.S.C. sec. 522(k) and sec. 503(b)(2). In Law v. Siegel, the Court, in a unanimous opinion authored by Justice Scalia, reversed the bankruptcy court’s ruling, holding that the court’s authority to sanction abusive litigation practices did not extend to overcome the homestead exemption, and that the courts had numerous other options for punishing debtor misconduct. The decision is here.



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  • We are proud to have been honored with a nomination by the Capital Area Gay & Lesbian Chamber of Commerce (CAGLCC) for the "Corporate Ally of the Year Award", which honors a business that has made significant accomplishments in partnering with the LGBTA community! Thank you so much for the nomination! http://www.caglcc.org/aad2014



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  • On February 27, 2014, the Virginia Supreme Court issued three opinions of utmost importance to appellate practitioners, addressing when Virginia Code sec. 8.01-384(A) allows a litigant who was precluded by the trial court from asserting a contemporaneous objection to a ruling to raise that issue on appeal.

    In Commonwealth v. Amos, the appellant was imprisoned for contempt after the trial judge found that she had lied under oath. At that time, the appellant had no counsel, she was just a witness, and she did not raise an objection when the trial court sent her to jail, although she did file a motion to vacate that ruling 17 days later. The Court ruled, 6-1, that in those circumstances the appellant had no meaningful opportunity to contemporaneously objection to the trial court’s contempt ruling, and thus she could appeal the issue. . The decision is here.

    In Maxwell v. Commonwealth, after a jury returned a guilty verdict against Maxwell, the trial judge informed counsel that the jury had submitted questions during deliberations, and had answered those questions without the involvement of counsel. Maxwell’s counsel moved to set aside the verdict based on that ex parte communication, which is expressly prohibited under Va. Code sec. 19.2-263.1. The Court of Appeals previously held that Maxwell could not appeal the issue because he had not made a contemporaneous objection. The Supreme Court reversed, 6-1, holding that since Maxwell’s counsel was prevented from objecting through no fault of his own, he was permitted to appeal the issue under 8.01-384(A). However, in Rowe v. Commonwealth, decided in the same opinion, the facts compelled a different result. There, the prosecutor made an impermissible statement during closing argument about the defendant’s failure to proffer evidence. Before defense counsel began making a closing argument, he told the trial court of his intention to make a motion about the prosecutor’s statement. The judge told defense counsel, “We’ll deal with it when the jury goes out to retire.” Defense counsel accepted that request. Under those circumstances, the Court ruled, 5-2, that defense counsel had waived the objection and could not appeal it under 8.01-384(A). Those consolidated opinions are here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • On February 27, 2014, the Virginia Supreme Court issued the following opinions:

    In an opinion that is required reading for commercial litigators, the Court answered two questions certified from the U.S. Court of Appeals for the Fourth Circuit: First, may a plaintiff use tortious interference with contract or business expectancy as the predicate unlawful act for a claim under Virginia’s business conspiracy statute, Va. Code sec. 18.2-499 and 500; and second, do those tortious interference claims have a two- or five-year statute of limitations? In Dunlap v. Cottman Transmission Systems, LLC, the unanimous Court answered in the affirmative as to the first question, as those claims are based on common law duties that arise outside of contracts, and held that a five-year statute of limitations applied to the tortious interference claims since those claims have to do with injury to property rights. The decision is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.

    In Beach v. Turim, neighbors engaged in litigation over whether a plat showing a four foot “private walk easement” did, in fact, create an express easement. The Court held that since the plat did not indicate to whom the easement was granted, or for what purpose, so that it could be determined which estate was dominant and which was servient, the plat itself was insufficient to create an express easement. The unanimous decision is here.



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  • The U.S. Supreme Court issued three rulings on Wednesday, February 25, 2014:

    First, the U.S. Supreme Court addressed whether a police seizure of cash in Georgia provided personal jurisdiction for a suit in a Nevada federal court. In Walden v. Fiore, a deputized DEA agent in a Georgian airport seized a large amount of cash being transported by two Nevada residents. The agent filed a false probable cause affidavit in support of the seizure with the Georgia authorities, but no further action was taken and the funds were returned to the travelers, who then filed a tort suit in Nevada. The U.S. Supreme Court, in a unanimous opinion authored by Justice Thomas, held that the Georgia agent lacked the requisite minimum contacts with Nevada to establish personal jurisdiction, and reversed the Ninth Circuit’s ruling because it improperly shifted the focus to the agent’s contacts with the Nevada residents. A link to the opinion is here: http://www.supremecourt.gov/opinions/13pdf/12-574_8mj9.pdf

    Under the rule set forth previously in Georgia v. Randolph, the police may conduct a warrantless search of a premises when an occupant provides consent, but when another physically-present occupant objects that refusal is dispositive as to that occupant. In Fernandez v. California, the U.S. Supreme Court held that where an occupant is not physically present, Randolph does not apply, and that occupant’s previously-stated objection does not prevent a warrantless search based on the consent of another occupant. Justice Alito delivered the opinion on behalf of a six-justice majority. Justices Scalia and Thomas each issued concurrences stating their belief that Randolph was wrongly decided, although correctly applied in this case. Justice Ginsburg, joined by Justices Sotomayor and Kagan, dissented, arguing that Randolph extended to these circumstances. A link to the opinion is here: http://www.supremecourt.gov/opinions/13pdf/12-7822_he4l.pdf

    In Kaley v. United States, the U.S. Supreme Court analyzed whether a criminal defendant can challenge a grand jury’s determination of probable cause that led to the indictment. In this case, after a grand jury found probable cause to indict two defendants for reselling stolen merchandise and laundering the proceeds, the government issued a restraining order against the defendants’ assets. The defendants wished to use those assets for their legal fees, and sought to challenge the facts underlying the indictment to combat the restraining order. The Court, in an opinion by Justice Kagan that was joined by Justices Scalia, Kennedy, Thomas, Ginsburg, and Alito, resolved a split that had evolved in the circuits on this question, and held that a grand jury’s finding of probable cause may not be so challenged. Chief Justice Roberts, joined by Justices Breyer and Sotomayor, filed a dissent, arguing that the rule set forth by the majority impermissibly hindered the defendants’ rights to hire counsel of their choice, particularly as applied to the facts of this case. A link to the opinion is here: http://www.supremecourt.gov/opinions/13pdf/12-464_n7io.pdf

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • FOURTH CIRCUIT RULING: On February 25, 2014, the Fourth Circuit issued a published opinion analyzing the extent a party is indispensable to a quiet title action. The case of Trans Energy, Inc. v. EQT Production Company began as a quiet title action, in which the predecessor to Pennzoil transferred its gas rights to a parcel of land in Wetzel County, West Virginia to two different gas companies. Those agreements were never recorded among the land records. One gas company transferred its Wetzel County rights and interests (without mention of the Pennzoil grant) to a predecessor of EQT by recorded transfer. Pennzoil then transferred its gas rights to the entire parcel by recorded assignment to a predecessor of a subsidiary of Trans Energy, which then assigned a royalty interest to REV. When Trans Energy discovered EQT’s alleged interest, it, along with REV, filed suit in federal court to quiet title. EQT counterclaimed. Trans Energy ultimately prevailed on summary judgment, and EQT appealed. On appeal, EQT argued for the first time that the federal court lacked subject matter jurisdiction because some of REV’s members resided where EQT resided, thus destroying diversity.

    The Fourth Circuit held that REV was not an indispensible party; that its interests were the same as its fellow plaintiffs, given that it simply received a royalty stream from another plaintiff; and that EQT’s counterclaim was not prejudiced by REV’s dismissal from the suit. Noting that “considerations of finality, efficiency, and economy become overwhelming” after a ruling on the merits, the Fourth Circuit simply dismissed REV from the suit with prejudice and affirmed the other rulings of the district court. The decision is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • SUPREME COURT RULING: A criminal defendant’s Sixth Amendment right to counsel is violated when his or her lawyer’s performance at trial falls below an objective standard of reasonableness. In Hinton v. Alabama, decided by the U.S. Supreme Court on February 24, 2014, defense counsel fell below that standard when he was unaware that Alabama law allowed his client to be reimbursed for “any expert witness expenses reasonably incurred.” As a result, defendant’s counsel erroneously believed he was limited to hiring an expert who would accept what the trial court had initially offered to pay--$1,000. The only expert who accepted that amount was grossly unqualified, in defense counsel’s own admission, to rebut the prosecution’s experts, and the defendant was sentenced to death. The Court, in a unanimous per curiam opinion, vacated the judgment and remanded for a new trial. The decision is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • FOURTH CIRCUIT RULING: On February 21, 2014, the Fourth Circuit clarified the standard a bankruptcy creditor must meet in proving that it received monies from a debtor in good faith, and thus does not have to return the money to the trustee. The trustee over the long-running Taneja bankruptcy sought to claw back allegedly fraudulent payments that one of Taneja’s businesses made to a bank. The bank asserted that it received the payments in good faith under 11 U.S.C. sec. 548(c). The Fourth Circuit held in In re Vijay K. Taneja, that the good-faith standard set forth in In re Nieves, 648 F.3d 232 (4th Cir. 2011), applied as the standard for any good faith defense raised under 548(c). In such cases, the court must consider “whether the transferee actually was aware or should have been aware, at the time of the transfers and in accordance with routine business practices, that the transferor-debtor intended to ‘hinder, delay, or defraud any entity to which the debtor was or became . . . indebted.’” Using that standard, the Fourth Circuit held that the bank’s evidence sufficed to prove the affirmative defense. Judge Winn lodged a dissent, arguing that the bank had not met its burden of proof. A link to the decision is here: The decision is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • FOURTH CIRCUIT RULING: On February 21, 2014, the Fourth Circuit turned away a challenge by a private landowner to a taking of its property for an infrastructure project. Under Virginia Code secs. 33.1-119 and 120, the City of Chesapeake took immediate title to land owned and operated by a car wash company, depositing $2.15 million in proffered compensation with the court to be resolved in subsequent condemnation proceedings. The land was to be used for a road-widening project in conjunction with the City, VDOT, and the U.S. Department of Transportation. The car wash sued, arguing, inter alia, that the taking violated the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, 42 U.S.C. secs. 4601-4655 (“URA”), which requires federal agencies to follow certain policies in taking land. The Fourth Circuit, in Clear Sky Car Wash, LLC v. City of Chesapeake, ruled that the URA does not create any individually enforceable rights, nor any rights that could be enforced by reference through 42 U.S.C. sec. 1983. The Court also ruled that the car wash could not compel the Department of Transportation to enforce the URA through the Administrative Procedure Act. The decision is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • US Court of Appeals for DC Opinion: In a case of first impression, the U.S. Court of Appeals for the D.C. Circuit ruled on February 14, 2014, that a settlement agreement embodied in a judicial consent decree is a contract under the Tucker Act (under which the U.S. Government has waived sovereign immunity to certain lawsuits), and thus the Court of Federal Claims has jurisdiction to adjudicate claims based on the government’s alleged violation of the settlement’s terms. The Court in Franklin-Mason v. Mabus declined to adopt the Navy’s argument that the government’s breach of a court-supervised settlement was a “wrong without a remedy.” The Court also held that even where the consent decree was entered by a district court, such claims have to be brought in the Court of Federal Claims because the Tucker Act does not contain a waiver of sovereign immunity that would permit a district court to have jurisdiction over the case. The decision is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • US Court of Appeals for DC Opinion: In a decision affecting the 600,000 to 700,000 tax preparers in the United States, on February 11, 2014 the U.S. Court of Appeals for the DC Circuit held in Sabina Loving v. IRS that the agency could not rely on a statute enacted in 1884 authorizing the IRS to “regulate the practice of representatives of persons before the Department of the Treasury” to promulgate regulations that would have required every tax-return preparer to pass an initial certification exam, pay annual fees, and complete at least 15 hours of continuing education courses each year. The decision is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • FOURTH CIRCUIT RULING: On January 31, 2014, the U.S. Court of Appeals for the Fourth Circuit ruled that a debt collection communication to a debtor stating that the creditor would assume a debt to be valid unless disputed in writing within thirty days was not compliant with the Fair Debt Collection Practices Act, specifically 15 U.S.C. sec. 1692g(a)(3) of that Act, which by its terms allows for the debtor to dispute a debt orally as well as in writing. The published per curiam opinion of the Court in Clark v. Absolute Collection Service, Inc. is here.

    For more information, please contact James N. Markels at 202-457-1610 or by email at jmarkels@jackscamp.com.



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  • The Family Place Charity Event: Wednesday, Feb. 5th, 6:00PM-12PM. Gala Hispanic Theatre. The Honorary Diplomatic Chairs will His Excellency Harold Forsyth Ambassador of Peru and Mrs. Maria Veronica de Forsyth. J&C's own Roy Kaufmann, noted attorney and philantropist will serve Co-Chair.



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