Lorenzo v. SEC

Issues

Can a defendant who sent emails containing misstatements to potential investors be held liable under a fraudulent-scheme claim where the evidence showed that the defendant merely forwarded the emails at the direction of another?

This case asks the Supreme Court to determine the scope of Janus Capital Group, Inc. v. First Derivative Traders, as well as the extent of liability for securities professionals who play a supportive role in fraudulent-scheme claims. Francis Lorenzo contends that the Supreme Court should apply a narrow definition of primary liability to Rule 10b-5 securities actions. Lorenzo argues that he is not culpable for securities fraud under Rules 10b-5(a) and (c) because, in forwarding emails that were written by his superior, he did nothing more than provide “substantial assistance” to those who defrauded investors with misleading financial statements. The Securities and Exchange Commission (“SEC”) counters that Lorenzo played a primary role in advancing the fraud because he signed the emails as the director of investment banking, and he told the potential investors to contact him for information about the financial health of his brokerage firm’s clients. This case will determine the ease with which the SEC can bring claims against securities professionals accused of fraud.

Questions as Framed for the Court by the Parties

Whether a misstatement claim that does not meet the elements set forth in Janus Capital Group, Inc. v. First Derivative Traders can be repackaged and pursued as a fraudulent-scheme claim.

In 2009, Francis Lorenzo (“Lorenzo”) was appointed director of investment banking for Charles Vista, LLC (“Charles Vista”), a brokerage firm in New York City. Lorenzo v. Securities and Exchange Commission at 3. Lorenzo oversaw the account of Charles Vista’s largest client, a startup company called Waste2Energy Holdings, Inc. (“W2E”).

Written by

Edited by

Additional Resources

Submit for publication
0

National Meat Association v. Harris

Issues

Whether the Federal Meat Inspection Act—under which slaughterhouses must separate animals that cannot walk on their own and inspect them for diseases—preempts a state law that bans any slaughtering of such animals and requires their immediate euthanization.

 

In response to the largest beef recall in United States history, California amended its Penal Code to ban the slaughtering of nonambulatory animals and require that slaughterhouses euthanize any such animals on their premises. The National Meat Association filed suit arguing that the Federal Meat Inspection Act expressly preempts California’s ban on the slaughter of nonambulatory animals, and that the Federal Meat Inspection Act’s historical context demonstrates Congress’s intent to exercise exclusive authority over the meatpacking industry. Attorney General of California Kamala Harris and animal protection organizations (including the Humane Society of the United States) propose a narrow understanding of slaughterhouse “operations” and argue that the California ban does not undermine the Federal Meat Inspection Act’s purpose. The outcome of this case will affect the slaughterhouses’ ability to examine animals for disease before euthanizing them and states’ ability to regulate areas where general federal law already exists.

Questions as Framed for the Court by the Parties

The Federal Meat Inspection Act ("FMIA"), as amended by the Wholesome Meat Act of 1967 and the Humane Methods of Slaughter Act, comprehensively regulates the "premises, facilities, and operations" of slaughterhouses where meat is prepared for human consumption. Since the passage of the Wholesome Meat Act, the FMIA has expressly preempted state regulations "in addition to, or different than" federal regulations. 21 U.S.C. § 678. Thus, for almost half a century, a uniform federal regulatory framework has safeguarded animal and human health and safety. In 2008, California passed a law - the provisions of which were later considered and expressly rejected by federal regulators - requiring federally-inspected slaughterhouses to "immediately euthanize" any nonambulatory animal on its premises, thereby eliminating important federally-required ante-mortem inspection of possibly diseased animals.

The questions presented in this case are:

  1. Did the Ninth Circuit err in holding that a “presumption against preemption” requires a “narrow interpretation” of the FMIA's express preemption provision, in conflict with this Court's decision in Jones v. Rath Packing Co., 430 U.S. 519, 540 (1977) that the provision must be given “a broad meaning”?

  2. When federal food safety and humane handling regulations specify that animals (here, swine) which are or become nonambulatory on federally inspected premises are to be separated and held for observation and further disease inspection, did the Ninth Circuit err in holding that a state criminal law which requires that such animals not be held for observation and disease inspection, but instead be immediately euthanized, was not preempted by the FMIA?
  3. Did the Ninth Circuit err in holding more generally that a state criminal law which states that no slaughterhouse may buy, sell, receive, process, butcher, or hold a nonambulatory animal is not a preempted attempt to regulate the “premises, facilities, [or] operations” of federally-regulated slaughterhouses?

Concerns regarding meat safety arose in 2008 after the Humane Society, a respondent in this case, released a video that showed nonambulatory cows being kicked, electrocuted, and dragged by chains at Westland/Hallmark slaughterhouse in California. See Nat’l Meat Ass’n v. Brown, 559 F.3d 1093, 1096 (9th Cir.

Written by

Edited by

Additional Resources

Submit for publication
0

Timbs v. Indiana

Issues

Is the Eighth Amendment’s Excessive Fines Clause, which prohibits the government requiring excessive payments as punishment for criminal offenses, incorporated against the states under the Fourteenth Amendment?

Court below

This case asks the Supreme Court to determine whether the Eighth Amendment prohibits the states from imposing excessive fines, fees, and forfeitures. Tyson Timbs contends that because the Excessive Fines Clause is deeply rooted in the United States’ history and tradition, it is a fundamental right that the states cannot violate as a result of the Fourteenth Amendment. The State of Indiana argues that the relevant issue is not whether the Excessive Fines Clause, in general, is incorporated against the states, but rather whether there is a proportionality requirement for state forfeitures concerning property, or in rem forfeitures. Indiana maintains that protection from disproportionate in rem forfeitures is not deeply rooted in our nation’s history and tradition. The outcome of this case will affect how states and localities generate revenue; the degree of financial burden that states and localities may impose on individuals; and state governments’ ability to deter criminal activity and reintegrate people within the criminal justice system into society.

Questions as Framed for the Court by the Parties

Whether the Eighth Amendment’s excessive fines clause is incorporated against the states under the Fourteenth Amendment.

In January 2013, Defendant Tyson Timbs purchased a Land Rover with $42,058.30 in life-insurance proceeds after his father’s death. Indiana v. Timbs at 2. Timbs then regularly used the Land Rover to buy and transport heroin in the State of Indiana for his drug addiction. Id. The police learned of Timbs’s drug trafficking, however, and set up three controlled heroin buys.

Written by

Edited by

Additional Resources

Submit for publication
0

Apple Inc. v. Pepper

Issues

Are App Store customers “direct purchasers” of Apple who have standing to bring a suit alleging antitrust violations?

In this case, the Supreme Court will determine whether customers of the iPhone’s App Store are considered direct purchasers of Apple. The question of direct purchaser status under the Illinois Brick doctrine is necessary to grant standing and proceed with an antitrust class action accusing Apple of monopolizing the market for iPhone apps. The Ninth Circuit held, and the class action representatives now argue, that customers of the App Store are direct purchasers because Apple functions as a distributor for app developers. Apple disagrees, arguing that it sells its distribution services to app developers, who are its direct purchasers; moreover, Apple asserts that it does not possess key price-setting power. The Court’s decision in this case will have implications for who may bring antitrust actions, potentially opening the door to duplicative damages and excessive private litigation.

Questions as Framed for the Court by the Parties

Whether consumers may sue for antitrust damages anyone who delivers goods to them, even where they seek damages based on prices set by third parties who would be the immediate victims of the alleged offense.

In 2007, Apple released the original iPhone. In re Apple iPhone Antitrust Litig., 846 F.3d 313, 315–16 (9th Cir. 2017). One year later, Apple launched the “App Store,” through which iPhone users may purchase and download applications (“apps”).

Written by

Edited by

Additional Resources

Submit for publication
0

Carpenter v. Murphy

Issues

Do the reservation borders of the Creek Nation Indian Tribe drawn in Oklahoma in 1866 constitute an “Indian reservation” today under 18 U.S.C. § 1151(a)?

After was Convicted of a murder that occurred on disputed tribal land, Patrick Murphy asks the Supreme Court to determine if the 1866 territorial boundaries of the Creek Nation tribal land are still in effect today. If the boundaries are in effect, Murphy asserts that his murder conviction must be overturned because it was committed within the Creek Nation boundaries, meaning the Oklahoma state court that convicted him did not have jurisdiction to hear the case.  Oklahoma State Penitentiary Interim Warden Mark Carpenter counters that the Creek Nation reservation has been disestablished and is no longer in effect, arguing that Oklahoma state courts indeed had jurisdiction to prosecute Murphy for the murder. Carpenter contends that giving effect to the territorial boundaries would create taxation and regulatory problems, while Murphy counters that acknowledging the tribal land boundaries would lead to mutually profitable tax agreements and other community benefits such as increased job opportunities and more effective law enforcement.

Questions as Framed for the Court by the Parties

Whether the 1866 territorial boundaries of the Creek Nation within the former Indian Territory of eastern Oklahoma constitute an “Indian reservation” today under 18 U.S.C. § 1151(a).

Respondent Patrick Dwayne Murphy is a member of the Muscogee (Creek) Nation Indian tribe. Carpenter v. Murphy (“Carpenter”) at 7. In August 1999, Murphy murdered an acquaintance on disputed tribal land. Id. He was arrested and tried in Oklahoma state’s trial court.

Written by

Edited by

Additional Resources

Submit for publication
0

Nutraceutical Corp. v. Lambert

Issues

Whether Federal Rule of Civil Procedure 23(f)’s 14-day deadline to petition for permission to appeal is subject to equitable exceptions.

This case asks the Supreme Court to consider whether courts may apply equitable exceptions to Federal Rule of Civil Procedure 23(f)’s 14-day deadline to petition for permission to appeal. After the district court decertified the consumer class suing Nutraceutical and denied Lambert’s motion for reconsideration, Lambert filed a petition for permission to appeal under Rule 23(f) in June 2015. The Ninth Circuit held that the petition was proper because equitable exceptions applied. Nutraceutical now argues that the petition was not timely because it was filed well beyond the 14-day deadline and that equitable exceptions do not apply to Rule 23(f). Lambert contends that the petition was filed in a timely manner and that equitable exceptions make the petition proper even if the filing was not timely. This case will have implications for protecting unsophisticated litigants in class action suits as well as for judicial economy and resources.

Questions as Framed for the Court by the Parties

Whether the U.S. Court of Appeals for the 9th Circuit erred when it held that equitable exceptions apply to mandatory claim-processing rules—such as Federal Rule of Civil Procedure 23(f), which establishes a 14-day deadline to file a petition for permission to appeal an order granting or denying class-action certification—and can excuse a party’s failure to file timely within the deadline specified by Federal Rule of Civil Procedure 23(f), in conflict with the decisions of the U.S. Courts of Appeals for the 2nd, 3rd, 4th, 5th, 7th, 10th and 11th Circuits.

Respondent Troy Lambert (“Lambert”) brought a consumer class action in federal district court against Petitioner Nutraceutical Corporation (“Nutraceutical”), alleging that their dietary supplement product was illegally misbranded and violated numerous provisions of Title 21 of the Code of Federal Regulation

Written by

Edited by

Additional Resources

Submit for publication
0

Nieves v. Bartlett

Issues

Can a First Amendment retaliatory arrest claim be brought under 42 U.S.C. § 1983 when there is probable cause for the arrest?

The Supreme Court will determine whether probable cause can function as a defense for police officers facing a retaliatory arrest claim under 42 U.S.C. § 1983. Petitioners Luis Nieves and Bryce Weight (“Nieves”) contend that Supreme Court precedent requires plaintiffs to plead and prove the absence of probable cause in order to bring a retaliatory arrest claim. Additionally, Nieves argues that a probable cause requirement conforms with common law authority and accords with the First Amendment’s purposes and values. Respondent Russell Bartlett (“Bartlett”) counters that Supreme Court precedent and the common law actually do not support a probable cause requirement for retaliatory arrest claims.  Further, Bartlett asserts that the text of 42 U.S.C. § 1983 itself cannot support a probable cause requirement. From a policy perspective, this case is important because it asks the Court to balance a plaintiff’s First Amendment right to free speech with the ability of police officers to make arrests without fear of a lawsuit.

Questions as Framed for the Court by the Parties

Whether probable cause defeats a First Amendment retaliatory-arrest claim under 42 U.S.C. § 1983.

Respondent Russell Bartlett attended Arctic Man 2014, an extreme ski event held in Alaska’s Hoodoo Mountains. Bartlett v. Nieves et al., 2016 WL 3702952 at *1 (D. Ala. 2016). The event brings people to Alaska for several days of partying. Id. During the last night of the event, Petitioners, Alaska State Troopers Luis Nieves and Bryce Weight, were investigating a party for underage drinking.

Written by

Edited by

Additional Resources

Submit for publication
0

Williamson v. Mazda Motor of America

Issues

If a manufacturer has installed one of two seatbelt options permitted under federal motor vehicle safety standards, can a citizen sue the manufacturer in state court for damages resulting from failure to install the other restraint option, or is the claim preempted by the federal law?

 

Delbert Williamson sued Mazda Motor of America after his wife died in a car accident while she was riding in their Mazda MPV minivan. Williamson claimed that Mazda was liable under state tort law for installing lap-only seatbelts, as opposed to lap-and-shoulder seatbelts, in the rear aisle seat where his wife sat during the crash. Mazda argues that Williamson’s state law claim is preempted by a federal regulation granting manufacturers the choice between lap-only and lap-and-shoulder seatbelts in rear aisle seats. The California Court of Appeal sided with Mazda and held that federal vehicle safety regulations preempted Williamson’s claim because the regulations conflicted with his state law claim. Williamson, however, contends that the Court should allow his state claim because it does not conflict with federal regulations, but rather furthers federal objectives of vehicle safety. The Supreme Court’s decision in this case will address the extent of preemption of state law claims by on-point federal regulations and in turn affect manufacturer liability under state tort claims.

Questions as Framed for the Court by the Parties

Where Congress has provided that compliance with a federal motor vehicle safety standard "does not exempt a person from liability at common law," 49 U.S.C. § 30103(e), does a federal minimum safety standard allowing vehicle manufacturers to install either lap-only or lap/shoulder seatbelts in certain seating positions impliedly preempt a state common-law claim alleging that the manufacturer should have installed a lap/shoulder belt in one of those seating positions?

On August 14, 2002 the Williamsons were driving in a 1993 Mazda MPV minivan through Utah. See Brief for Petitioners, Delbert Williamson, et al.

Written by

Edited by

Additional Resources

· Bloomberg Businessweek, Greg Stohr: Mazda Passenger Seatbelt Suit Gets U.S. Supreme Court Review (May 24, 2010)

· Torts Prof Blog, Catherine Sharkey: The Politics of Preemption: NHTSA, State Tort Law & Automobile Safety (Oct. 4, 2010)

· University of Denver Law Review, Andrea Ahn: Wyeth v. Levine: Moving Away from the Geier Trend

Submit for publication
0

U.S., Ex Rel. Eisenstein v. City of New York

Issues

If the United States decides not to intervene when a party files a qui tam action under the False Claims Act, should the party be allowed a 60-day time limit to file its notice of appeal because the United States is technically a party, or should they be subject to the standard 30-day time limit?

 

Fifty-four days after the Southern District of New York dismissed Irwin Eisenstein's qui tam action against the City of New York, Eisenstein filed a notice of appeal with the Second Circuit Court of Appeals. The Second Circuit asked the parties to brief whether the notice of appeal was timely filed. According to the Federal Rules of Appellate Procedure, parties only have 30 days to file a notice of appeal, and this will be extended to 60 days when the United States is a party.  Eisenstein claimed that, even though the United States declined to intervene, it was a "real party of interest" and therefore he was entitled to the 60 day limit. The City of New York conceded that, while the United States was a "party of interest", they were not a party for the purpose of measuring the timeline on appeal. The Supreme Court granted certiorari to determine whether the relator in a qui tam action is entitled to the extended 60 day time limit for appeal when the United States chooses not to intervene in the action.

    Questions as Framed for the Court by the Parties

    Whether the 30-day time limit in Federal Rule of Appellate Procedure 4(a)(1)(A) for filing a notice of appeal, or the 60-day time limit in Rule 4(a)(1)(B), applies to a qui tam action under the False Claims Act, where the United States has declined to intervene in that action.

    Eisenstein's Underlying Complaint

    Irwin Eisenstein was an employee of the City of New York ("the City"), and during his employment he lived in both New Jersey and the City. See U.S. ex rel. Eisenstein v.

    Written by

    Edited by

    Submit for publication
    0

    U.S. Army Corps of Engineers v. Hawkes Co.

    Issues

    Under the Administrative Procedure Act, are jurisdictional determinations by the U.S. Army Corps of Engineers that property contains “waters of the United States” (as defined by the Clean Water Act) subject to immediate judicial review?

     

    Peat miner Hawkes Co., Inc. owns property in Minnesota that contains wetlands. Hawkes requested a jurisdictional determination (“JD”) from the U.S. Army Corps of Engineers (the “Corps”) to determine if Hawkes could mine on new land. Under the Clean Water Act (“CWA”), the Corps can issue JDs to inform landowners if their land contains “waters of the United States” and are thus subject to certain licensure requirements. The Corps surveyed the property and issued an affirmative JD. The Supreme Court will decide whether JDs are final agency actions subject to judicial review under the Administrative Procedure Act (“APA”). To appeal an administrative decision under the APA, the decision must be final and impose legal obligations. The Corps asserts that JDs are not final agency actions because they are merely informational, and argues there are other options for landowners to obtain judicial review. Hawkes argues that other methods of review are prohibitively costly, and that JDs practically impose legal obligations on landowners. The Court’s decision could affect how often agencies defend their actions in court.

    Questions as Framed for the Court by the Parties

    Does the United States Army Corps of Engineers’ determination that the property at issue contains “waters of the United States” protected by the Clean Water Act, 33 U.S.C. 1362(7); see 33 U.S.C. 1251 et seq., constitute “final agency action for which there is no other adequate remedy in a court,” 5 U.S.C. 704, and is therefore subject to judicial review under the Administrative Procedure Act, 5 U.S.C. 701 et seq.?

    Hawkes Co., Inc., is a mining company that excavates peat from wetland areas in Minnesota. Hawkes wanted to expand its operations to wetlands near its current operations. See Hawkes v. United States Army of Eng’rs, 782 F.3d 994, 998 (8th Cir. 2015). After purchasing an option on the new property, Hawkes met with the U.S.

    Written by

    Edited by

    Acknowledgments

    The authors would like to thank Jed Stiglitz, assistant professor of law and Jia Jonathan Zhu and Ruyin Ruby Ye Sesquicentennial Fellow, for his valuable insights about this case.

    Submit for publication
    0
    Subscribe to