Appellate Law & Practice

CA1: How a big company snookered itself into a bad posture at arbitration (and jurisdiction on appeal)

Berenson v. National Financial Services, No. 06-1112.  This involves a dispute between parties with an agreement to arbitrate that covers most disputes, but not class actions.  The District Court determined that “it would adjudicate the merits of the Berensons' claims before addressing the issues of class certification. All parties agreed to this arrangement.”  While a motion for class certification was pending, the District Court granted a number of motions for summary judgment in part, including the class-action claims, stating that he would issue a full decision later.   Thereafter NFS moved to compel arbitration.  That motion was granted.  Then the judge issued a complete “summary judgment memorandum and order, explaining its earlier ruling” which was partially favorable to the plaintiffs.  NFS seizes on this and holds that such explanatory order actually rescinded the arbitration order, NFS claims that it can now seek interlocutory review under the Federal Arbitration Act, 9 U.S.C. § 16 (a)(1)(B).  But the First disagrees, and basically says that NFS brought this on itself by agreeing to go to the merits and is seeking to use the Supreme Court’s decision in AT&T Techs., Inc. v. Communications Workers of Am., 475 U.S. 643, 648 (1986) as a “sword” rather than a shield.”  So, the First lacks jurisdiction over the appeal.

The subject matter is interesting because it involves all the problems with electronic payment systems that allow people (like myself) to pay all sorts of bills from their computer.  There are different variants of them, which can, from time to time deprive people of interest, which the plaintiffs argued violated the the EFTA – 15 U.S.C. § 1693.

Barry Barnett comments here.

CA1: Indian tribe subject to state administative proceedings

Aroostook Band of Micmacs v. Ryan, Nos. 06-1127, 06-1358.  Former employees of an Indian commenced an against them for some kind of discrimination at the Maine Human Rights Commission.  The tribe responded by seeking an injunction.  The state argues that federal law actually specifically provides it with the power to hear cases over the tribe.  Reversing the lower court, the First holds that the tribe does not have immunity from such claims.  Because states’ interactions with tribes, quite frankly, resemble contractual negotiations, they quickly get boring.  But, if this is your bag, then you gotta read the case. Anyway, long story short: Congress can regulate our dealings states dealings with tribes.  Congress did, in fact, allow states to enter into agreements with tribes.  The settlement act, did not exempt tribal government from state laws.  I would like it if someone could provide some insight into this case.   Lipez dissents.

CA1: Bankruptcy diversity jurisdiction bonanza !

Siaca v. DCC Operating, Inc., 05-9012.  Continuing with the string of BAP cases, Judge Smith starts using big words.

Although an involuntary bankruptcy petition was filed, in a suit in a District Court, non-diverse parties intervened in a diversity action that was pending and in the summary judgment stage (with liability being the only remaining issue), alleging retention of payments in breach of trust.  After the non-diverse parties intervened at the District Court, they asked that the matter matter to the bankruptcy court.  But, while the motion to refer was pending, they initiated an adversarial proceeding in bankruptcy court!  Then, the original motion for referral was granted, and the bankruptcy court docketed a second adversarial proceeding!  The bankruptcy court then determined liability and issued a final judgment under Fed. R. Civ. P. 54(b).

CA1: Making your divorce a federal case

Mooney v. Mooney, 06-1118 (12/22/06). In this case, a husband seeks rescission of a separation agreement that was not merged into the divorce judgment, arguing that it was procured by duress, coercion, and undue influence. I don't know the facts, but are not all divorce actions premised on duress, coercion, and undue influence? Keep reading.

CA1: First makes new law on Discretionary Function exception to FTCA

Abreu v. US, No. 05-1889 (11/14/06), affirms the dismissal of a “Vieques” FTCA case.  (Vieques, if you recall is an island off Puerto Rico that the Navy uses a testing range, has arouse much political ire.)  In this case, the plaintiffs “alleged that the Navy’s past military exercises and waste disposal activities at .. Vieques... exposed them to hazardous substances such as Agent Orange, depleted uranium, napalm, and other ordinance with explosive components, as well as harmful noise pollution.” 

CA1: appellate procedure and FTCA victory for FBI in informant-gone-wild case

Barrett et al. v. US, No. 05-1905, is yet another one of the FTCA cases against the government because of the FBI’s mishandling of an informant.  Despite being a pawn on the FBI, the informant continued his evil, and caused a lot of pain.  It generated a lot of publicity.

Then people sued.  Mostly late, it seems.

This case does have some interesting procedural issues.  So, read on.

CA1: Public radio not covered by eleventh amendment

Pastrana-Torres v. Zabala-Carrion, No. 05-2298, holds that Corporación de Puerto Rico Para La Difusión Pública (WIPR), Puerto Rico's public broadcasting company is not an arm of the state government and therefore is not entitled to Commonwealth's Eleventh Amendment immunity from suit in federal court.  Applying Fresenius Med. Care Cardiovascular Res., Inc. v. Puerto Rico & the Caribbean Cardiovascular Ctr. Corp., 322 F.3d 56 (1st Cir. 2003), the court recites the test:

• whether the state has structured the entity to share its Eleventh Amendment immunity; and if inconclusive
• the risk that money damages will be paid from the state's treasury if the entity is found liable

The First looks at how the public broadcasting corporation operates independently of the government, and that the board cannot be vetoed by the government.  It also notes that it can charge money and ask for donations.  But, on the other hand, it is bound by Puerto Rico’s APA, and needs to submit reports to the government.  Therefore, the first part of the test is inconclusive.

In applying the second part of the Fresenius test, the court concludes that “enabling act does not unequivocally indicate that the Commonwealth structured WIPR to share its sovereignty, and there is no indication that the Commonwealth has bound itself to pay WIPR's debts.”

CA1: dead ship doctrine and laches

Puerto Rico Ports v. Umpierre-Solares, No. 05-1637. This case holds that admiralty jurisdiction extends to a contract to remove a sunken ship, even though the ship is later moved to another place. In essence, once the contract is maritime in nature, then a court sitting in admiralty can hear the issue. The defendant had argued that the “dead ship doctrine” prevents the federal court from obtaining jurisdiction over the contract, but since the contract was for removal of a ship “lying at the bottom of San Juan Harbor, obstructing navigation, and that the Contract related to the removal of this obstruction.” (The fact pattern is somewhat interesting, because this ship actually has sunk twice.)

Once the court had jurisdiction over the matter, the First holds that breach of contract claim was barred by laches. Interestingly, the court discusses the use of analogous statutes to determine how long a time period for laches should be, and notes under direct applications of statutes of limitations, plaintiffs have the burden of proving that they are within the statue, but under analogous applications (using laches), defendants have the burden.

CA1: a lack of a federal claim should be dismissed without prejudice

Hickey v. Metrowest Medical, Nos.04-2461, 04-2462 (unpublished) is an interesting, but short opinion. A pro se plaintiff filed what looks like a medical malpractice case against a hospital. The District Court affirms the dismissal for failure to state a claim, but notes that it should have been for lack of jurisdiction, and therefore the dismissal should have been without prejudice, thereby allowing her to proceed in state court.

CA1: diversity jurisdiction and sanctions

Baella-Silva v. Hulsey, No. 05-1214, affirms a denial of a sanctions order (reviewing for abuse of discretion) wherein while a motion to remand was pending, the parties agreed to a settlement which included a liquidated damages clause for disclosing the terms of the settlement.  The plaintiff, however, “electronically filed on the federal district court's public docket a motion for disbursement of funds, which disclosed some of the details of the sealed settlement judgment.” and filed other lawsuits.  The motion was publically available for one hour.  The court figured that the liquidated damages clause had been breached.