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

The Ninth Circuit affirmed defendant's conviction for mail and wire fraud, conspiracy to commit mail and wire fraud, and for money laundering offenses. The panel vacated defendant's sentence and restitution order, remanding for further proceedings. The panel rejected defendant's challenges to the mail and wire fraud jury instructions. The panel held that, assuming without deciding that defendant's argument to the contrary was not foreclosed by precedent, this court's caselaw that "participating" in a scheme to defraud was forbidden by the mail and wire fraud statutes did not amount to the creation of a common-law crime in violation of separation-of-powers principles, and the district court did not err by instructing the jury that it could find defendant guilty for "participating in" a scheme to defraud.The panel vacated the custodial sentence, holding that the record did not support the district court's imposition of a two-level "organizer" sentencing enhancement under USSG 3B1.1. Finally, the panel held that the written restitution order was internally inconsistent and inconsistent with the district court's oral announcement. Therefore, the panel vacated the restitution order and remanded for the district court to strike the lump-sum payment requirement from the judgment. View "United States v. Holden" on Justia Law

In this consolidated bankruptcy appeal, two law firms challenged the bankruptcy court's order approving a settlement for an involuntary Chapter 11 bankruptcy. The Ninth Circuit affirmed the district court's dismissal of the appeals, holding that the firms forfeited their objection to the settlement agreement because neither firm explicitly objected to the settlement or entered an appearance. Furthermore, the evidence on the record regarding the bankruptcy court and trustee's understanding that the firms were implicitly objecting was not clear enough to overcome such failures. The panel assumed without deciding that the law firms' challenge should be reviewed for plain error, rather than dismissed without reaching the merits, and found that the bankruptcy court did not err in approving the settlement agreement. View "Reid and Hellyer, APC v. Laski" on Justia Law

The Ninth Circuit affirmed the district court's grant of habeas relief to petitioner, who was convicted and sentenced to death for killing an FBI agent. The panel applied de novo review and held that an unrevealed connection between the FBI agent and the judge who presided over petitioner's trial violated due process by creating a constitutionally intolerable risk of judicial bias. In this case, the FBI agent had previously investigated the judge for possible criminal prosecution. The panel held that the risk of bias deprived petitioner of a fair tribunal to which he was constitutionally entitled. View "Echavarria v. Filson" on Justia Law

The Foundation filed suit challenging a religious exercise at a local school board's meetings, including a prayer in the portion of the meeting that was open to the public and that included student attendees and participants. The Ninth Circuit affirmed the district court's grant of summary judgment and injunctive relief to the Foundation, holding that invocations to start the open portions of school board meetings were not within the legislative prayer tradition that allowed certain types of prayer to open legislative sessions, because these prayers typically take place before groups of schoolchildren whose attendance was not truly voluntary and whose relationship to school district officials, including the school board, was not one of full parity. Applying the test in Lemon v. Kurtzman, 403 U.S. 602, 612–13 (1971), the panel held that the Board's prayer policy lacked a secular legislative purpose and thus violated the Establishment Clause. The panel also held that the district court's injunction was not overbroad because it was limited to restricting only speech that constituted a governmental establishment of religion. View "Freedom from Religion Foundation, Inc. v. Chino Valley Unified School District Board of Education" on Justia Law

Current and former employees of the University of Southern California may not be compelled to arbitrate their collective claims for breach of fiduciary responsibility against USC in an action under the Employee Retirement Income Security Act (ERISA). The Ninth Circuit affirmed the district court's denial of USC's motion to compel arbitration of claims for breach of fiduciary duty in the administration of two ERISA plans. The panel held that the district court properly denied USC's motion to compel arbitration where the claims asserted on behalf of the Plans in this case fell outside the scope of the arbitration clauses in individual employees' general employment contracts. View "Munro v. University of Southern California" on Justia Law

These consolidated appeals stemmed from the Commissioner's efforts to hold the former shareholders of a close corporation, Slone Broadcasting, responsible for taxes owed on the proceeds of its sale of assets to another broadcasting company, Citadel. The shareholders followed up the asset sale to Citadel by selling Slone Broadcasting's stock to another company, Berlinetta, an affiliate of Fortrend. Berlinetta and Slone Broadcasting then merged into a new company called Arizona Media.The Ninth Circuit reversed the tax court's judgment on the petition for redetermination of federal income tax deficiency challenging the shareholders' liability for taxes in connection with an asset and stock sale. The panel applied Arizona's Uniform Fraudulent Transfer Act and held that the transaction was constructively fraudulent as to the creditor (the IRS) because the debtor (Slone Broadcasting) did not receive a reasonably equivalent value in exchange for the transfer to the shareholders and was left unable to satisfy its tax obligation. In this case, the purpose of the shareholders' transaction with Berlinetta was tax avoidance and thus reasonable actors in the shareholders' position would have been on notice that Berlinetta never intended to pay Slone Broadcasting's tax obligation. The panel held that the shareholders' sale to Berlinetta was a cash-for-cash exchange lacking independent economic substance beyond tax avoidance. The panel also held that the shareholders were liable to the government for Slone Broadcasting's federal tax obligation as "transferees" under 26 U.S.C. 6901, because Slone Broadcasting's liquidating distribution to the shareholders was a constructively fraudulent transfer under Arizona law. View "Slone v. Commissioner of Internal Revenue" on Justia Law

26 C.F.R. 1.482-7A(d)(2), under which related entities must share the cost of employee stock compensation in order for their cost-sharing arrangements to be classified as qualified cost-sharing arrangements and thus avoid an IRS adjustment, was not invalid under the Administrative Procedure Act (APA). The Ninth Circuit reversed the tax court's decision declaring 26 C.F.R. 1.482-7A(d)(2) invalid and held that the challenged regulation was not arbitrary and capricious, but rather a reasonable execution of the authority delegated by Congress to Treasury. Therefore, the regulation was entitled to Chevron deference. View "Altera Corporation & Subsidiaries v. Commissioner of Internal Revenue" on Justia Law

The Ninth Circuit reversed the district court's order denying plaintiff's motion for attorney's fees in a copyright infringement action brought by a film production company, alleging that a single user illegally downloaded and distributed repeatedly American Heist, a Hollywood action movie. In Fogerty v. Fantasy, Inc., 510 U.S. 517 (1994), the Supreme Court laid out factors to guide discretion in whether to award fees. The panel held that the district court did not faithfully apply the Fogerty factors in this meritorious BitTorrent action. The panel noted that the district court's analysis of whether fees are warranted should be based on Glacier's case against defendant, and not on the district court's view of BitTorrent litigation in general or on the conduct of Glacier's counsel in other suits. Therefore, remand was necessary because the district court denied fees under the present circumstances based on a one-size-fits-all disapproval of other BitTorrent suits. View "Glacier Films (USA), Inc. v. Turchin" on Justia Law

OTR filed suit against Defendant West, asserting various claims under the Lanham Act and state law. Primarily at issue on appeal was whether West could be found liable for reverse passing off under the Lanham Act. The Ninth Circuit affirmed the judgment, holding that West was liable for reverse passing off because he did not simply copy OTR's intellectual property but passed off genuine OTR products as his own. In this case, West asked one of OTR's suppliers to provide him with sample tires from OTR's molds; he asked the supplier to remove OTR's identifying information from the tires; and he wanted to use the tires to obtain business from one of OTR's customers. The panel affirmed the district court's conclusion that West did not establish that OTR committed fraud on the United States Patent and Trademark Office, and held that fraud on the PTO must be established by clear and convincing evidence. The panel also affirmed the denial of a new trial on the issue of trade dress validity and the district court's rejection of a proposed jury instruction. The panel addressed additional issues in a concurrently filed memorandum disposition. View "OTR Wheel Engineering, Inc. v. West Worldwide Services, Inc." on Justia Law

The Ninth Circuit reversed the district court's order directing plaintiff to sign a settlement agreement in an employment discrimination suit. The panel held that a provision of the settlement agreement between plaintiff and his former employer placed a restraint of a substantial character on plaintiff's medical practice and thus violated California Business and Professional Code 16600. Therefore, the entire settlement agreement was void and the district court abused its discretion in ordering plaintiff to sign it. The panel remanded for further proceedings. View "Golden v. California Emergency Physicians Medical Group" on Justia Law