Tuesday, March 31, 2009

The chutzpah to assert "unclean hands"

The federal rules of civil procedure allow you to get post-judgment relief upon a showing of good cause. This means that if judgment is entered on February 1, you can ask the trial court for some relief on June 1 if something happens over the four months which requires the judge to revisit the case, i.e., evidence of fraud or even the discovery of new evidence which could have affected the trial. But there are limits. Lord knows there are limits.

The case is Motorola Credit v. Uzan, decided on March 30. This case involved a lawsuit that Motorola won against Uzan, a Turkish telecommunications firm. Including punitive damages, Motorola was awarded approximately $3 billion in damages. That's right, $3 billion dollars. Then Uzan discovered that Motorola received a set-off in damages from sources (including an insurance company) which arguably allowed Uzan to pay a reduced amount to Motorola. In light of this evidence, under Federal Rule 60(b), Uzan moved the district court for an order reducing its payments to Motorola, probably on the basis that you cannot recover twice for the same injuries.

Rule 60(b) is an equitable remedy, which means that the judge has discretion to alter the judgment. As the Court of Appeals notes, this kind of equitable relief depends, in part, on whether the moving party has clean hands, a legal term of art. The Supreme Court has held that “he who comes into equity must come with clean hands.” Precision Instrument Mfg. Co. v. Automotive Maintenance Mach. Co., 324 U.S. 806, 814 (1945). So, if you want relief from the Court in the interests of fairness, your own behavior must be squeaky clean.

Uzan is not squeaky-clean. This is where the Court of Appeals throws the book at Uzan. As Judge Cabranes notes, "there are already ten published decisions in this Circuit chronicling the background of this case and 'the extraordinary nature of the Uzans’ wrongful behavior.'” Moreover, "Relying on their vast personal wealth, the Uzans have time and again deployed their lawyers to raise legal roadblocks to the enforcement of the judgment against them. They have persistently endeavored to evade the lawful jurisdiction of the District Court and undermine its careful and determined work."

Then the Court of Appeals has a little fun with the case. It does go through the motions of affirming the district court's refusal to grant Uzan Rule 60 relief, stating, "We therefore conclude that the Uzans’ utter disregard for the District Court’s orders precludes the relief that they are seeking, and the District Court did not err in denying it." But the Court only does this after observing that "Despite their flat-out refusal to comply with the District Court’s lawful orders, the Uzans now have the chutzpah to seek post-judgment, equitable relief from complying with those orders."

Chutzpah! We've all heard people use the word Chutzpah. But what does the word really mean? The Second Circuit tells us in a footnote. A gratuitous footnote, but a good one, probably written after the Court of Appeals asked its clerks for some good research on "chutzpah":

"'Chutzpah' as a legal term of art is analytically similar to 'unclean hands,' though not necessarily coterminous with that concept as understood in the law of chancery. The 'classic definition' of chutzpah has been described as 'that quality enshrined in a man who, having killed his mother and father, throws himself on the mercy of the court because he is an orphan.' Leo Rosten, The Joys of Yiddish 92 (1968); see also Thaler v. Second New Haven Bank, Civ. No. B-713, slip op. at 1 (D. Conn. Apr. 10, 1974) (“When the apocryphal child murdered his parents and then sought mercy as an orphan, he set a standard for courtroom chutzpah that has not been rivaled until the filing of this lawsuit”); Scher v. Nat’l Assoc. of Sec. Dealers, 386 F. Supp. 2d 402, 404 (S.D.N.Y. 2005) (quoting the unpublished opinion by then-District Judge Newman and explaining the extraordinary circumstances of the civil suit brought by Seymour Thaler, a convicted felon and former New York state senator). Cf. Yates v. City of New York, 2006 U.S. Dist. LEXIS 54199, at *1 (S.D.N.Y. Aug. 4, 2006) (using this “vastly overused” but nonetheless “most appropriate” term to describe “an individual, [who] after being mauled by the 450-pound Siberian tiger he had been raising inside his fifth-floor apartment along with an alligator, sue[d] the city and the police who entered the apartment in an effort to rescue the animals for doing so without a search warrant”).

Tuesday, March 24, 2009

Retaliation against public employees: conquering the time lag

In order to win a retaliation case, you have to show that the defendant engaged in an adverse employment action at least a few months after you engaged in the protected activity. We call that causation. A few weeks ago, in an inmate beating case, the Court of Appeals adopted an interesting theory of liability on retaliation, suggesting that defendants can be guilty of retaliation if they waited longer to strike back, so long as there was a basis for them to wait, i.e., the best moment to retaliate did not present itself right away. (That case was Espinal v. Goord).

The Court of Appeals has now extended that principle to employment cases, albeit in a summary order that partially reverses summary judgment. The case is Brenes v. City of New York, decided on March 23. The plaintiff spoke with the New York Post about attendance fraud in City schools. That article appeared on December 21, 1997. Less than two months later, plaintiff's supervisor attempted to scuttle plaintiff's reappointment to his teaching position at Norman Thomas High School. That's close enough to infer retaliatory intent. But plaintiff was not fired at this time, so it's unclear that this counts as an adverse employment action. The next negative event for plaintiff was a series of negative performance evaluations starting in October 1998. That's 10 months after the New York Post article embarrassed the supervisors.

Ten months is normally too long to infer retaliation. Except that the evidence suggests that plaintiff's supervisor, Frank, thought that plaintiff would be "excessed" from his position in June 1998. Once it became clear that plaintiff was not excessed and that he was going to resume working in fall 1998, plaintiff began receiving negative evaluations. Brenes is allowed to argue at trial that the negative evaluations were retaliatory.

Here's how the Second Circuit sees it: "A reasonable jury could infer from these facts that Frank expected that Brenes’s position would disappear in June, and that she therefore had no incentive to further retaliate against him until it became clear that he would be returning to Thomas. When considered in this light, Brenes’s series of negative performance evaluations at the start of the next school year is suspicious and could plausibly support an inference of retaliation, particularly given that Brenes previously received only satisfactory evaluations from prior supervisors and Frank." For this proposition, the Court of Appeals cites Espinal v. Goord, 554 F.3d 216, 228 (2d Cir. 2009) (holding that a six-month lapse between the dismissal of a plaintiff’s lawsuit and an allegedly retaliatory beating by a police officer who was a defendant in the suit supported an inference of causation because “[i]t is plausible that the officers waited to exact their retaliation at an opportune time”).

This case allows retaliation plaintiffs to overcome the presumption that, without direct evidence of retaliatory intent ("You're fired because you blew the whistle six months ago"), an adverse action needs to take place more than a few months after the protected activity. As direct evidence is rare, this case highlights an important principle, but as shown by this unpublished ruling, the Court of Appeals deems this an unremarkable principle in light of Espinal v. Goord.

Friday, March 20, 2009

No bail for Madoff

The general public may have a misperception about bail. Bail is not to punish. Bail is to make sure the defendant does not disappear during the legal proceedings. Many people want Bernie Madoff severely punished, but now that he has pleaded guilty to the financial crime of the century, the question before the Court of Appeals this week was whether he is entitled to bail pending his sentencing.

The case is U.S. v. Madoff, decided by summary order on March 20. I admire the Second Circuit's decision to resist the temptation to issue a formal, published opinion on such a high-profile issue, particularly since it sidesteps an issue (at the end of the opinion) that invokes a Ninth Circuit decision. Since the standard of review on this appeal is whether the trial court committed "clear error" in denying Madoff bail, the issue is not so complicated as to provide a basis for a precedential ruling.

The Court of Appeals affirms the district court's order denying Madoff bail. Summarizing Judge Chin's ruling, the Second Circuit notes that "the district court found that in light of the defendant’s age (70) and the length of a potential sentence (150 years), he has an incentive to flee, and that because he has the means to do so, he presents a risk of flight, and therefore should not be released." That is a reasonable assessment, the Second Circuit finds.

Madoff's lawyers argued that his incentive to flee is not a proper consideration and that the trial court was not specific enough in denying bail. No dice, the Court of Appeals says. "As to the incentive to flee (based on his age and exposure to a lengthy imprisonment), we consider that such an incentive naturally bears upon and increases the risk of flight." In addition, while Madoff argued that all of his assets are accounted for and are inaccessible to him, the district court did not have to deem that representations as reliable. "The defendant has a residence abroad, and has had ample opportunity over a long period of time to secret substantial resources outside the country." So Bernie's not going anywhere but the big house.

Tuesday, March 17, 2009

A bad jury instruction doesn't always get you a re-trial

Is there any such thing as the perfect jury instruction? Judges sometimes rely on form books for the jury instructions, but each judge may have his or her own language for certain legal instructions that close out the trial and hand the case to the jury. But a bad jury instruction does not always get you a new trial, as the Court of Appeals again reminds us.

The case is Olson v. State of New York, decided on March 17. Claiming disability discrimination, the plaintiff went to trial and lost. He appealed because the jury instruction did not make it clear that the employer is guilty of discrimination even if disability discrimination was not the only reason for plaintiff's termination, so long as disability discrimination was a motivating reason.

This is a legitimate objection. The Court of Appeals notes, "We have consistently held that a plaintiff in an employment discrimination case need not prove that discrimination was the sole motivating factor, the primary motivating factor, or the real motivating factor in the adverse employment action; she need only prove that discrimination was a motivating factor." If you subscribe to the world-view that things happen for many reasons, this theory of liability makes sense. If the employee is fired for 10 reasons, he wins the case if nine reason relate to job performance and one of those reasons was his disability. The idea is that if disability was still a motivating factor, then the employer broke the law.

The Court of Appeals is "troubled" by the trial court's jury instruction which only says that plaintiff has to prove he was fired "because of his disability." This language implies that disability has to be the only reason in order for Olson to win. But there is another line of cases that says that you look at the jury instruction as a whole to see if the trial judge basically gave the jury the correct framework to analyze the case. The Court of Appeals doesn't go there, as it finds instead that the bad instruction was "harmless" in that there was overwhelming evidence that the plaintiff was fired because of his job performance, not because of his disability:

This included, for example, evidence that Olson told his supervisor that "there will be some bloodshed around here," that he repeatedly violated departmental guidelines concerning email usage, that he used inappropriate language to refer to supervisors, and that he drafted a fake memorandum in another officer’s name and circulated it. Significantly, the verdict sheet shows that the jury rejected each alleged claim of discrimination. Moreover, as noted, Olson did not adduce evidence of other employees who engaged in similarly serious misconduct who were not discharged.

Wednesday, March 11, 2009

Don't lie to your attorney

A criminal defendant was charged with conspiracy to import heroin, and he steadfastly maintained his innocence, refusing to cooperate with the government if it meant he would have to admit his guilt. After a jury found him guilty, but prior to sentencing, another witness came forward with incriminating evidence against defendant, who then came clean with the government and admitted his guilt. He got a 121 month sentence. The case goes to the Court of Appeals because the trial court granted his habeas corpus petition on the basis that he was denied effective assistance of trial, in that the lawyer had given the defendant an overly optimistic assessment of his chances for acquittal.

The case is United States v. Pitcher, decided on March 11. The Court of Appeals takes away the habeas finding and Pitcher goes back to jail, because Pitcher lied to his attorney about his involvement in the conspiracy. Those lies affected counsel's advice about the risks of going to trial, as the lawyer testified at the habeas hearing that he would not have gone to trial had he known the truth.

For technical reasons, the district court could not grant the habeas petition as that relief contravened a prior ruling from the Court of Appeals in this case. Here's how the Court of Appeals summarizes the sequence of events:

[Counsel] explained to the court in an April 14, 1999 status conference held prior to sentencing that Pitcher, who had only recently admitted his involvement in the conspiracy, had lied to him “about significant things” related to his involvement in the conspiracy and “[h]ad I realized the defendant’s – the truth of what had actually occurred here before we went to trial, I never would have went [sic] to trial.” At the same status conference, [defendant] admitted to the court that he thought he had “a very good chance at winning” because he “didn't think [he] was guilty.” These facts make clear that [counsel] would not have given [defendant] such a “positive prognosis about his chances of winning at trial,” had Pitcher not lied to him about his involvement in the charged offenses.

If the district court's habeas order was foreclosed by a prior Court of Appeals ruling, then why did the Second Circuit issue a precedential opinion this time around? Maybe so that it could warn criminal defendants about dishonesty in the future: "Although we reverse on the grounds stated, we add that we are wary of endorsing any precedent that could enable a defendant to benefit from lying to his defense counsel or that might suggest a duty on the part of defense counsel to arm-twist a client who maintains his innocence into pleading guilty."

Friday, March 6, 2009

Airline meal dispute resolves assault/battery quandary

I'll bet you didn't know that any acts of violence on an airplane can land you in federal court on criminal charges. Consider yourself on notice that hitting a flight attendant violates the law against assault.

The case is United States v. Delis, decided on March 5. Delis was angry when the flight attendant told him they ran out of chicken and he would have to settle for beef. Most people would eat the steak. Not Delis. According to the opinion, he began shouting at the attendant, and then he struck her. Here's a ringside account of what happened at 30,000 feet over the Atlantic Ocean (the flight was from Switzerland to Idlewild Airport, now known as Kennedy Airport):

Williams-Beauvil [the flight attendant) testified that Delis shouted obscenities and then struck her. She indicated that the blow landed “just under her left breast.” After being struck, she instinctively grabbed Delis’s chin and he then pushed her hand away. Nestor Quecuty, another flight attendant, testified that he approached the pair when he heard screaming and that, at the time he arrived, Williams-Beauvil and Delis were arguing about whether Delis had called Williams-Beauvil an offensive epithet. From the aisle behind Delis’s seat, Quecuty observed Williams-Beauvil place her finger about ten inches from Delis’s face. Quecuty then saw Delis, “with his right arm and [an] open hand, [take] a swing at” Williams-Beauvil, making contact with her arm. Yet another witness, a passenger, testified that he observed Delis object when he learned that Williams-Beauvil had no more chicken. An argument ensued and grew louder. The passenger eventually observed Delis “push[] [Williams-Beauvil] backwards.”

Delis did not dispute that he had an argument with Williams-Beauvil about the in-flight meal choice. Rather, he claimed that Williams-Beauvil pointed her finger at him and that he simply pushed her hand away from his face. Immediately thereafter, he was restrained by another member of the flight crew. Delis further asserted that he remained calm throughout the remainder of the flight.

A magistrate judge found Delis guilty of assault as prohibited under the U.S. Code. The issue here is whether Delis could violate the assault law when he did not intend to injure the flight attendant. This is where the opinion gets boring, at least for most people. Not me. I am impressed the level of legal scholarship in this opinion for a case in which the punishment was time served and a 10 dollar fine. The opinion is a tour de force of statutory analysis, as the Court of Appeals parses the federal laws governing assault and battery in the context of their legislative history and highly regarded treatises in criminal law, including Blackstone's famous legal commentaries which are several centuries old but regularly cited in court rulings today.

Assault and battery are often used interchangeably, but they have subtle distinctions. We generally understand assault to cover the apprehension of an offensive touching. In other words, if you see someone coming at you with a knife, that's assault. The attack is the battery, the offensive touching. A battery does not require an intent to injure, however, so that reckless offensive contact can also constitute a battery. Putting the pieces of this puzzle together, the end result for the Court of Appeals is that assault under federal law does not require an intent to injure. As the Court summarizes the holding, " Because we conclude that “simple assault,” as used in 17 U.S.C. § 113(a)(5), incorporates both of the common-law crimes of assault and battery, we hold that an offensive touching does constitute simple assault regardless whether the perpetrator possessed any specific intent to injure." What it means for Delis is that even if he did not intend to hurt the flight attendant, he committed an assault in making contact with her over his outrage at not receiving chicken.

This case reminds me that unusual facts make for some of the most interesting but important cases. Again, the statutory analysis here is exquisite. It just happened to be this strange case that prompted the Court of Appeals to sort through this legal issue which will certainly arise again someday in a different context. A good example of the unusual circumstances in which these issues often arise can be found in the precedents the Second Circuits cites in support of its holding: United States v. Lewellyn, 481 F.3d 695, 697-99 (9th Cir. 2007) (concluding that simple assault includes spitting on another); United States v. Whitefeather, 275 F.3d 741, 742-43 (8th Cir. 2002) (holding that simple assault includes urinating on another).

Thursday, March 5, 2009

Circuit upholds preliminary challenge to sex offender law

The sex offender laws have been challenged on constitutional grounds ever since the mid-1990's, when states began passing their own Megan's Law. New York has a law entitled "Sex Offender Management and Treatment Act" which contains provisions regulating sex offenders who require civil commitment or supervision. Mental Hygiene Legal Services challenged certain procedures under this law, and obtained a preliminary injunction against their enforcement. The Court of Appeals affirmed the injunction.

The case is Mental Hygiene Legal Services v. Paterson, decided on March 4 in a summary order. MHLS challenged two provisions. The first permits the pre-trial detention of a "sex offender requiring civil management." The other provision says that the law covers a person charged with, but not convicted of, a sex offense because of his mental capacity to stand trial.

The district court granted the injunction on the first provision after noting that "unjustified confinement to a mental institution is a 'massive curtailment of liberty' and also that being coerced into accepting a designation of 'mentally abnormal sex offender' is also highly stigmatic." This means that if the trial court thinks the law is constitutionally vulnerable, the plaintiffs can get relief now as opposed to waiting for trial, which can be more than year down the road. As the Court of Appeals summarizes the case, the problem with the first provision is that it authorizes "the pre-trial detention of a 'sex offender requirement civil management' without an individualized finding that the person is sufficiently dangerous to warrant confinement and that lesser conditions of supervision will not suffice to protect the public."

In its opinion, 2007 WL 4115936 (SDNY), the district court observed that "upon a finding of probable cause to believe that the [offender] may have a mental abnormality as defined by the statute, a person in the [plaintiff's] situation must be automatically detained pending trial. Such detention is potentially catastrophic. Not only will the [offender] lose his liberty, but he will likely lose his job and his house, and default on loans. He will thus, by mandatory operation of the statute, be deprived of more liberty before he is adjudicated in need of treatment, based on a mere showing of probable cause to believe treatment is required, than New York seeks to impose after he is shown by clear and convincing evidence to need treatment. This is perverse, and at oral argument the State was unable to give any rational explanation of how this furthers any legitimate government interest." Rather than detain the offender on probable case, the district court held, there has to be an individualized finding that the offender is dangerous enough to warrant confinement and that no other solution will suffice.

The Second Circuit upheld the district court's second injunction in the case, which addresses post-conviction confinement. Some offenders are found to have lacked the mental state sufficient to find them guilty, either because they had a "mental disease or defect" or were mentally incapacitated in some other way. Under the law, the state can confine the offender if it finds through clear and convincing evidence that the offender did in fact engage in the conduct.
This provision may be unconstitutional, warranting the preliminary injunction, because the constitution requires a finding beyond a reasonable doubt that the offender engaged in the conduct. "Clear and convincing evidence" and "beyond a reasonable doubt" may sound like hair-splitting, but these distinctions are significant because criminal convictions require the latter finding. While this law provides civil, not criminal, remedies for individuals who are mentally ill and dangerous, remedies under this law "are predicated on criminal conduct. The statute applies only to criminals or to individuals who would be criminals if they had been sane when they committed the acts which constituted the crime and had been competent to stand trial." Since the sex offender commitment law requires proof beyond a reasonable doubt, the district court properly issued the preliminary injunction.