Justia U.S. 9th Circuit Court of Appeals Opinion Summaries

Articles Posted in December, 2014
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Plaintiff filed a class action suit against Old Republic, a company that sells home warranty plans, alleging that Old Republic arbitrarily denied claims made by him and a putative class of similarly situated policyholders of Old Republic plans, or otherwise cheated him and this class out of benefits owed under their policies. On appeal, plaintiff challenged the district court's orders denying his motion for class certification, denying his motion for leave to amend his complaint, and granting Old Republic's motion for partial summary judgment. The court did not reach the merits of the district court's order because the appeal is moot. The parties settled all of plaintiff's claims and plaintiff expressly released all of his claims against Old Republic. Applying Narouz v. Charter Commc'sn, the court concluded that the appeal is moot because plaintiff has no financial interest or other personal interest whatsoever in class certification. View "Campion v. Old Republic Protection Co." on Justia Law

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Plaintiff appealed the denial of his application for social security disability benefits. The court concluded that substantial evidence supports neither the ALJ's rejection of plaintiff's testimony nor his rejection of the medical assessment by plaintiff's treating physician. Consequently, the court reversed the district court's affirmance of the denial of benefits. However, because the court has "serious doubt" as to whether plaintiff is, in fact, disabled under Garrison v. Colvin, the district court shall remand the case to the ALJ for further proceedings on an open record. On remand, the court did not require the ALJ to require as true plaintiff's testimony, the treating physician's assessment, or any other evidence. View "Burrell v. Colvin" on Justia Law

Posted in: Public Benefits
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Pom Wonderful, owner of the "POM" standard character mark, filed a trademark infringement claim against Pur to stop Pur from using the word "pom" on its pomegranate-flavored energy drink. On appeal, Pom Wonderful challenged the district court's order of its motion for a preliminary injunction. The court reversed, holding that the district court abused its discretion in finding that Pom Wonderful is unlikely to succeed on the merits of its claim. Because the district court's decision to deny Pom Wonderful's motion for a preliminary injunction was tainted by its mistaken likelihood-of-success determination, the court remanded with instructions to the district court to consider whether Pom Wonderful meets its burden of proving the other elements of a preliminary injunction. View "Pom Wonderful v. Hubbard" on Justia Law

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The City of Spokane filed suit against Fannie, Freddie, and FHFA, arguing that Fannie and Freddie are not statutorily exempt from paying real property transfer taxes. The court concluded that it is clear that the statutory carve-outs allowing for the taxation of real property as "other real property is taxed" encompass only property taxes, not excise taxes. Therefore, Fannie and Freddie are statutorily exempt from paying the transfer taxes in Washington. The court held that the entities' exemption statutes do not exceed Congress's constitutional authority. Because Congress has power under the Commerce Clause to regulate the secondary mortgage market, it has power under the Necessary and Proper Clause not only to create Fannie and Freddie but also to ensure their preservation by exempting them from state and local taxes. Finally, the exemptions neither commandeer state and local officials nor transgress general principles of federalism. Therefore, the court rejected Spokane's Tenth Amendment arguments. Accordingly, the court held that Congress exempted Fannie and Freddie from state and local taxation of real property transfers and that it had constitutional authority to do so. The court affirmed the judgment. View "City of Spokane v. Fed. Nat'l Mortgage Ass'n" on Justia Law

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Petitioner, convicted of murdering two men, appealed the district court's denial of his habeas corpus petition. The court concluded that petitioner was not entitled to habeas relief on his guilt phase claim for ineffective assistance of counsel because, under either version of the facts, counsel's decision not to call petitioner as a witness was strategic. Therefore, the decision fell within the wide range of reasonable professional assistance deemed constitutionally adequate under Strickland v. Washington. However, the district court erred in determining that the Antiterrorism and Effective Death Penalty Act of 1996 (AEDPA), 28 U.S.C. 2254(d), bars habeas relief on petitioner's claim that his counsel was constitutionally ineffective for failing to investigate and present reasonably available mitigating evidence at sentencing. The district court erred in determining, even if AEDPA does not bar relief, that petitioner failed to establish that counsel's performance prejudiced him under Strickland. The court further concluded that defense counsel's decision not to call petitioner to testify at the guilt phase of his trial was within the wide range of reasonable professional management. Accordingly, the court affirmed in part and reversed in part. View "Mann v. Ryan" on Justia Law

Posted in: Criminal Law
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Plaintiff appealed the district court's judgment, affirming in part and reversing and remanding in part, the Commissioner's denial of his application for social security disability insurance. The court concluded that the ALJ erred in failing to provide specific reasons for rejecting plaintiff's testimony regarding the severity of his symptoms and, therefore, reversed the judgment of the district court affirming that portion of the ALJ's decision. The court also concluded that the record does not compel a finding of disability and, therefore, the court remanded for further proceedings. View "Treichler v. Comm'r of Soc. Sec." on Justia Law

Posted in: Public Benefits
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The IRS challenged the Tax Court's decision that the Salus Mundi Foundation was not liable under 26 U.S.C. 6901 for the unpaid tax liability arising from the sale of appreciated assets held by Double-D Ranch, Inc. The court concluded that the two requirements of section 6901 - transferee status under federal law and substantive liability under state law - are separate and independent inquiries. Consequently, the IRS cannot rely on federal law to recharacterize the series of transactions for purposes of the state law inquiry. The court adopted the Second Circuit's reasoning in Diebold Foundation, Inc. v. Comm'r on the state law inquiry and concluded that the Double-D shareholders had constructive knowledge of the fraudulent tax avoidance scheme at issue. Therefore, the court collapsed the series of transactions and concluded that the shareholders made a fraudulent conveyance under the New York Uniform Fraudulent Conveyance Act and that the state law liability prong of section 6901 was satisfied. The court remanded to the district court for further determinations. View "Salus Mundi Foundation v. CIR" on Justia Law

Posted in: Tax Law
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The Department of Interior's Bureau of Reclamation asked the NMFS in 2006 to evaluate the impact of continuing water extraction in the Central Valley on certain threatened and endangered Salmonid species that live there. NMFS developed a Biological Opinion (BiOp) in which it determined that Reclamation's proposed project would jeopardize some of the Delta's endangered Salmonids. NMFS required Reclamation to change the way it pumps water out of the Valley's rivers and groups that depend on Central Valley's water sued to stop this change. The district court found that NMFS violated the Administrative Procedure Act's (APA), 5 U.S.C. 706(2)(A), arbitrary or capricious standard when developing much of the BiOp and defendants appealed. The court held that the district court did not give NMFS the substantial deference it is due under the APA; the court found that the components of the BiOp invalidated by the district court are reasonable and supported by the record; and the court upheld the BiOp in its entirety. Accordingly, the court reversed and remanded the district court's entry of summary judgment in favor of defendants. View "San Luis & Delta-Mendota Water Authority v. Locke" on Justia Law

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Defendant was convicted of second degree robbery under Washington law, RCW 9A.56.190, for stealing a wallet and sentenced to prison for at least one year. Subsequently, defendant illegally reentered the United States three times. On the final and third time, he was indicted on one count of illegal reentry and defendant moved to dismiss the indictment on the ground that his prior removal orders had been entered in violation of his Fifth Amendment due process rights. The district court denied the motion and defendant was convicted of illegal reentry. The court concluded that a conviction for Washington second degree robbery, where accompanied by a sentence of at least one year, qualifies as an aggravated felony under 8 U.S.C. 1101(a)(43)(G). Because defendant was sentenced to a 14-month prison term, he was convicted of an aggravated felony. Because he is ineligible for relief, he suffered no prejudice from any procedural defects that may have occurred and the district court correctly denied his motion to dismiss his indictment. View "United States v. Alvarado-Pineda" on Justia Law

Posted in: Criminal Law
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Shareholders are required to make a “demand” on the corporation’s board of directors before filing a derivative suit, unless they sufficiently allege that demand would be futile. Before Arduini filed his derivative action against IGT and its board, four shareholders filed derivative suits that were consolidated. They argued that a demand was excused because: the IGT board extended the employment contract of IGT’s former CEO and chairman of IGT’s board of directors, and allowed him to resign rather than terminating him for cause; three directors received such high compensation from IGT that their ability to impartially consider a demand was compromised; six directors faced a substantial likelihood of liability for breaches of their fiduciary duties as committee members; and that other members had engaged in insider trading. The district court dismissed the consolidated suit for failure to make a demand or sufficiently allege futility; the Ninth Circuit affirmed. The district court then dismissed Arduini’s action, holding that Arduini had failed to make a demand and could not allege demand futility based on issue preclusion due to its ruling in the prior suit. The Ninth Circuit affirmed, holding that under Nevada law and these facts, issue preclusion barred relitigation of futility. View "Arduini v. Int'l Gaming Tech." on Justia Law