Justia Civil Procedure Opinion Summaries

Articles Posted in US Court of Appeals for the Third Circuit
by
E.O.H.C. and his daughter fled Mixco, Guatemala, a city plagued by violence, crossed into the U.S. and presented themselves to Border Patrol officers. The government began removal proceedings, scheduling a hearing in San Diego. Under a new DHS policy, the Migrant Protection Protocols, the government returned the two to Mexico to await their hearing. They were left to fend for themselves in Tijuana. E.O.H.C. told the IJ that he did not fear going back to Guatemala. He later alleged that a Border Protection officer advised him to say this. He was not then represented by counsel. The IJ ordered removal. E.O.H.C. waived the right to appeal, allegedly because he feared being returned to Mexico. They were transferred to a Pennsylvania detention facility, where they argued that E.O.H.C.’s appeal waiver was invalid. The BIA granted an emergency stay of removal. The government flew them to San Diego for return to Mexico. They filed an emergency mandamus petition. The government returned them to Pennsylvania. They challenged the validity and applicability of the Protocols and argued that returning them to Mexico would interfere with their relationship with their lawyer and would violate several treaties. The district court dismissed for lack of subject-matter jurisdiction. The Third Circuit reversed in part. When a detained alien seeks relief that a court of appeals cannot meaningfully provide on a petition for review of a final order of removal, 8 U.S.C.1252(b)(9) and 1252(a)(4) do not bar consideration by a district court. One claim, involving the right to counsel, arises from the proceedings to remove them to Guatemala and can await a petition for review. The other claims challenge the plan to return the petitioners to Mexico in the meantime. For these claims, review is now or never. View "E.O.H.C. v. Secretary United States Department of Homeland Security" on Justia Law

by
UGI builds natural gas pipelines. It obtained authorization to construct and operate an underground pipeline along 34.4 miles of land in Pennsylvania under the Natural Gas Act, 15 U.S.C. 717, The Landowners rejected UGI’s offers of compensation for rights of way, so UGI sought orders of condemnation. UGI prevailed; only the amount of compensation remained. The Landowners’ expert set the before-taking value of the land by comparing properties in the area and estimating what each is worth relative to the market but, in estimating the post-taking property values, the expert relied on his own “damaged goods theory,” drawing on his experience working in his grandfather’s appliance shop. The expert cited the impact on real estate values from the Three Mile Island nuclear incident in 1979, the Exxon Valdez Alaskan oil spill in 1989, and assorted leaking underground storage tanks. The expert’s reports contain no data relating to those incidents. The district court agreed “that some form of ‘stigma’ attaches to the property as a whole” and adjusted the awards accordingly. The Third Circuit vacated. Rule 702 requires reliable expert testimony that fits the proceedings. The expert testimony presented by the Landowners bound only to speculation and conjecture, not good science or other “good grounds.” View "UGI Sunbury LLC v. Permanent Easement for 1.7575 Acres" on Justia Law

by
The Paperas sued the Company. The court sent the case to mediation. In May 2016, the Paperas reported that the parties had settled and asked for “a sixty (60) day Order of Dismissal,” to be followed by an agreement for the court’s approval. The May 2016 Order stated that the case was dismissed and the parties had 60 days to finalize the settlement. The order’s minute entry stated the dismissal was “without prejudice”; to reinstate the action if a settlement was not consummated, a party would have to show good cause within 60 days. The court never got a settlement agreement. After the 60-day period elapsed, the court did not dismiss with prejudice. In September 2016, the Paperas asked for a conference call. On that call, the court reportedly stated that “it no longer had jurisdiction” and that it had administratively closed the case. A month later, the Paperas filed a new complaint. It was assigned to the same judge, who granted summary judgment based on claim preclusion and declined to reopen the May 2016 Order. The Third Circuit vacated and remanded. Because the order dismissing the first suit did not clearly say that the dismissal was involuntary or with prejudice, it did not preclude the second suit. For a dismissal to preclude claims, it must be with prejudice. View "Papera v. Pennsylvania Quarried Blueston Co." on Justia Law

by
Danziger, a Texas law firm, claims that it referred potential qui tam clients (including Epp) to an Ohio firm, Morgan Verkamp and had an oral contract to collect one-third of the attorney’s fees from the Epp suit. Epp retained Morgan Verkamp but never promised Danziger a referral fee. After years of litigation, the U.S. Government intervened and settled for hundreds of millions of dollars. Morgan Verkamp collected several million dollars in attorney’s fees. Danziger sought the referral fee in Pennsylvania state court by filing a “writ of summons,” which allows a plaintiff to seek discovery before filing a complaint. Danziger finally filed a complaint. Morgan Verkamp removed the case to federal court before the deadline for filing preliminary objections, then sought dismissal for lack of personal jurisdiction or, alternatively, for a transfer to Ohio. Danziger suggested a transfer to Texas. The Third Circuit affirmed the dismissal of the complaint. There is no specific jurisdiction because Danziger’s claims neither arise out of nor relate to Morgan Verkamp’s activities in Pennsylvania. Nor did Morgan Verkamp consent to personal jurisdiction by participating in pre-complaint discovery; Pennsylvania law does not let defendants object to jurisdiction until the plaintiff files a complaint. A defendant who removes to federal court does not thereby consent to personal jurisdiction. Danziger does not need a transfer; it could timely refile its claims in another forum. View "Danziger & De Llano LLP v. Morgan Verkamp LLC" on Justia Law

by
Plaintiffs sued 33 defendants, alleging “a widespread criminal enterprise ... involving numerous RICO [Racketeer Influenced and Corrupt Organizations Act] predicate acts," plus Pennsylvania law violations, asserting that the enterprise’s objective has been to inflict severe economic hardship to obstruct and discourage the plaintiffs from continuing in landscaping and snow removal services. The court dismissed the Iskens for lack of personal jurisdiction. The Iskens are Delaware residents and their business is a Delaware LLC with its principal place of business in Delaware. The Third Circuit vacated, holding that 18 U.S.C. 1965(b), not 18 U.S.C. 1965(d) (the general jurisdiction provision), governs the exercise of personal jurisdiction and that the plaintiffs satisfy the statutory (and constitutional) requirements for the district court to exercise such jurisdiction over the Iskens. When a civil RICO action is brought in a district court where personal jurisdiction can be established over at least one defendant, summonses can be served nationwide on other defendants if required by the ends of justice. The plaintiffs alleged a multi-state scheme implicating defendants from Delaware, New Jersey, and Virginia, but roughly half of the 33 defendants are Pennsylvania residents or Pennsylvania entities with their places of business in Pennsylvania. The exercise of personal jurisdiction over defendants from a neighboring state does not offend traditional notions of fair play and substantial justice. View "Laurel Gardens, LLC v. McKenna" on Justia Law

by
ABC stores its subscribers’ data on the cloud. ABC received a grand jury subpoena issued under 18 U.S.C. 2703(c)(2), ordering it to produce the non-content data of one of its subscribers, as part of a criminal investigation. The subpoena was accompanied by a nondisclosure order (NDO), prohibiting ABC from notifying any person, except its lawyers, of the existence of the subpoena for one year. Weeks later, a magistrate issued a search warrant directing ABC to produce content-specific data for the same account, with another NDO. ABC complied. The subscriber filed for bankruptcy. ABC moved to modify the NDOs to permit it to notify the bankruptcy trustee of the existence of the subpoena and warrant, arguing that the NDOs are content-based restrictions and prior restraints that infringe upon its First Amendment rights. ABC asserted the bankruptcy trustee had a duty to uncover and assert causes of action against the debtor’s officers and directors. The district court found that 18 U.S.C. 2705(b) implicates the First Amendment rights of service providers and that such an NDO passes strict scrutiny. The Third Circuit affirmed the denial of ABC’s motion to amend the NDOs. The governmental interest in maintaining grand jury secrecy is sufficiently strong for the NDOs to withstand strict scrutiny; the restriction is the least restrictive means of serving that interest and is narrowly tailored, being limited to one year. View "In The Matter of the Application of Subpoena 2018R00776" on Justia Law

by
In October 2013, Jones was on a Pennsylvania prison bus, traveling to his post-conviction hearing. Jones talked with a fellow inmate. The driver “threaten[ed]” both men, then switched Jones’s property box with that of the other inmate. The box held Jones’s legal papers for the hearing. Weeks later, Jones was waiting for another prison bus. The same driver yanked him out of line, put him in the segregation cage, and berated him. Jones told other inmates to get the names of the transportation crew; they took off their name tags. The stress of this incident exacerbated his mental ailments. He had a nervous breakdown and stayed two days in the medical annex. Days later, Jones filed a grievance. For 10 months, he refiled, appealed, and sent follow-up letters. In September 2014, he was released, but the prison had not decided his grievance. Just under two years after his release, Jones filed a pro se 42 U.S.C. 1983 complaint. On remand, a magistrate recommended dismissing his claim as time-barred. She acknowledged that the limitations period is tolled for a prisoner who exhausts his administrative remedies before suing but reasoned that the rule does not apply to former prisoners who sue after their release. The Third Circuit vacated. A prisoner must exhaust the prison’s internal administrative remedies, whether he sues from prison or sues after his release. Jones’s claim for injunctive relief against the driver were moot but Jones may seek monetary relief against the remaining defendants. View "Jones v. Capozza" on Justia Law

by
Charte (relator) filed a False Claims Act (FCA), 31 U.S.C. 3729–3733, "qui tam" suit alleging that defendants, including Wegeler, submitted false reimbursement claims to the Department of Education. Relators are entitled to part of the amount recovered. As required to allow the government to make an informed decision as to whether to intervene, Charte cooperated with the government. Her information led to Wegeler’s prosecution. Wegeler entered into a plea agreement and paid $1.5 million in restitution. The government declined to intervene in the FCA action. If the government elects to pursue an “alternate remedy,” the statute provides that the relator retains the same rights she would have had in the FCA action. Charte tried to intervene in the criminal proceeding to secure a share of the restitution. The Third Circuit affirmed the denial of the motion. A criminal proceeding does not constitute an “alternate remedy” to a civil qui tam action, entitling a relator to intervene and recover a share of the proceeds. Allowing intervention would be tantamount to an interest in participating as a co-prosecutor in a criminal case. Even considering only her alleged interest in some of the restitution, nothing in the FCA suggests that a relator may intervene in the government’s alternative-remedy proceeding to assert that interest. The text and legislative history regarding the provision indicate that the court overseeing the FCA suit determines whether and to what extent a relator is entitled to an award. View "United States v. Wegeler" on Justia Law

by
Gentile, the owner of a New York broker-dealer, was involved in two pump-and-dump schemes to manipulate penny stocks in 2007-2008. Gentile was arrested in 2012 and agreed to cooperate, but the deal fell apart in 2016. The indictment was dismissed as untimely. Gentile was still the CEO of a Bahamas-based brokerage and the beneficial owner of a broker-dealer; he had expressed an intention to expand that brokerage and hire new employees. The SEC filed a civil enforcement action eight years after Gentile’s involvement in the second scheme, seeking an injunction against further securities law violations and an injunction barring participation in the penny stock industry. A five-year statute of limitations applies to any “action, suit or proceeding for the enforcement of any civil fine, penalty, or forfeiture, pecuniary or otherwise,” 28 U.S.C. 2462. The Supreme Court has held that “[d]isgorgement in the securities-enforcement context” is a “penalty” subject to that five-year limitations period. The district court dismissed, holding that those remedies were penalties. The Third Circuit vacated; 15 U.S.C. 78u(d) does not permit the issuance of punitive injunctions, so the injunctions at issue do not fall within the reach of section 2462. The court remanded for a determination of whether the injunctions sought are permitted under section 78u(d). View "Securities and Exchange Commission v. Gentile" on Justia Law

by
The 1992 federal Professional and Amateur Sports Protection Act (PASPA), 28 U.S.C. 3702, prohibited governmental entities from involvement in gambling concerning competitive sports. New Jersey’s 2012 Sports Wagering Act authorized sports gambling. NCAA and professional sports leagues (Appellees) filed suit. The district court entered a temporary restraining order (TRO) barring the New Jersey Thoroughbred Horsemen’s Association (NJTHA) from conducting sports gambling, finding that the state law violated PASPA. The court required Appellees to post a $1.7 million bond as security. On appeal, NJTHA successfully challenged the constitutionality of PASPA in the Supreme Court. On remand, NJTHA unsuccessfully sought to recover on the bond. The Third Circuit vacated and remanded. NJTHA was “wrongfully enjoined” within the meaning of Federal Rule 65(c) and no good cause existed to deny bond damages. PASPA provided the only basis for enjoining NJTHA from conducting sports gambling. The Supreme Court ultimately held that that law is unconstitutional; NJTHA had a right to conduct sports gambling all along. There was no change in the law; NJTHA enjoyed success on the merits and is entitled to recover provable damages up to the bond amount. View "National Collegiate Athletic Association v. Governor of New Jersey" on Justia Law