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Keywords: Certification, NY Tax Law §§ 471, 471(e)
Panel: Hall, Livingston, and Chin (USDJ, SDNY)
Opinion by: Hall
Appeal from: EDNY (Anon, USDJ)
Result below: Grant of Preliminary Injunction
Result: Questions Certified to NY Court of Appeals
This case involves the district court’s grant of an injunction to New York City against defendants, owners of businesses on the Poospatuck Reservation of the sovereign Unkechauge Nation, prohibiting defendants’ sale of untaxed cigarettes to “bootleggers” who resell the cigarettes in NYC and avoid the hefty state and city taxes on cigarettes. The Court certifies the following questions to the New York Court of Appeals:
(1) Does N.Y. Tax Law § 471-e, either by itself or in combination with the provisions of § 471, impose a tax on cigarettes sold on Native American reservations when some or all of those cigarettes may be sold to persons other than members of the reservation’s nation or tribe?
(2) If the answer to Question 1 is “no,” does N.Y. Tax Law § 471 alone impose a tax on cigarettes sold on Native American reservations when some or all of those cigarettes may be sold to persons other than members of the reservation’s nation or tribe?
As a preliminary matter, the court holds that the City was not required to make a showing of irreparable harm; such harm is presumed by defendant’s alleged violation of state and federal tax statutes. The city must, however, demonstrate a clear and substantial showing of a likelihood of success on the merits. Federal law prohibits the taxation of cigarette sales to tribal members on a reservation. States are permitted to impose such taxes so long as they are not “unduly burdensome.” The precise issue on appeal is the interplay between NY’s Tax Law § 471, enacted in 1939, and § 471(e), enacted in 2005, which set up a tax-exempt coupon program for cigarette sales on tribal lands.
There is a recent Appellate Division, Fourth Department decision effectively answering the certified questions, Cayuga Indian Nation of New York v. Gould, 884 NYS 2d 510 (4th Dept 2009) (the majority held that § 471(e) is the exclusive means for taxing cigarette sales and that the section is not yet in effect, therefore “there is no statutory basis for the imposition of a cigarette tax on a qualified reservation;” the dissent would hold that § 471 imposes an independent obligation to pay taxes on cigarette sales), but the decision is on appeal to the New York Court of Appeals (0ral argument is scheduled for March 25, 2010) and “there are a number of factors that may persuade the Court of Appeals in its review of Cayuga to adopt the rationale of Justice Peradotto’s dissent.” Slip Op. at 20.
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Keywords: Attorney Admission, Misstatements of Fact
Panel: Cabranes, Sack, and Wesley
Result: Attorney’s admission vacated
Attorney Rodkin’s application to the 2d Circuit bar failed to disclose a suspension and a prior letter of admonition that he had received from New York’s disciplinary authorities. The offense was worse than mere non-disclosure; the attorney had directly denied he had ever been suspended in any court. The attorney has also been cautioned for raising meritless or un-exhausted claims. The panel strikes the attorney from the rolls of the Second Circuit bar and directs that he arrange substitute counsel on all pending matters.
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Keywords: Reinstatement of removal, INA § 241(a)(5), retroactivity
Panel: Miner, Cabranes, and Straub
Opinion by: Straub
Appeal from: Dept. of Homeland Security, Immigration and Customs Enforcement (“ICE”)
Result below: Order of deportation pursuant to INA § 241(a)(5) reinstated
Result: Petition denied
Retroactivity and INA § 241(a)(5), reinstatement of removal
Section 241(a)(5) 0f the Immigration and Naturalization Act (“INA”), effective April 1, 1997, changed the law concerning reinstatement of removal orders because it forecloses discretionary relief from the original reinstated order. The principal question on appeal is whether the section is impermissibly retroactive as to petitioner, who was deported for drug crimes but illegally reentered the US and married a US citizen prior to the enactment of the section, but who did not seek withholding of removal until afterwards.
The court employs a two-step test to determine whether retroactivity is proper. First, did Congress speak to the question? Second, if Congress did not consider retroactivity, would applying the statute retroactively tale away vested rights or impose new obligations or duties for past conduct? The analysis requires a “commonsense, functional judgment”. Here, the Supreme Court has already held that section 241(a)(5) is not impermissibly retroactive, Fernandez-Vargas v. Gonzales, 548 U.S. 30 (2006), and although some Courts of Appeal have held that the statute does not apply to applications for adjustment submitted before the effective date of the section, petitioner did not seek relief until after enactment. The Court determines that section 241(a)(5) “does not create new consequences for prior, completed conduct” and that petitioner is therefore ineligible for discretionary relief from the reinstated order of deportation.
Note that petitioner was still potentially eligible for withholding of removal, but he failed to demonstrate that he was targeted for persecution if deported, and he did not appeal that aspect of the BIA/IJ’s decision.
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Keywords: “Stigma Plus” Liberty Interest
Panel: Sack, B.D. Parker, and Goldberg (CIT)
Opinion by: Parker
Appeal from: D. Conn. (Dorsey, USDJ)
Result below: Partial SJ for Plaintiff
Result: Reversed
Stigma Plus Due Process Claims
Plaintiff, convicted of battery in cutting off the nipple of his sixteen-year-old girlfriend and forcing her to eat it (he had previously carved “Joey” on her chest with a piece of glass) complains that his due process rights were offended by the prison’s assigning him a “Sexual Offense Treatment Needs” (“SOTN”) classification of 3 (out of 5), indicating that he has “a current conviction, pending charge or known history of sexual offenses involving physical contact with the victim”. The primary bases for his claim is that he was acquitted of sexual assault, and that a former prison manual provided that acquitted charges may not be used to determine any risk score. The district court dismissed all monetary claims but ordered a hearing on the classification.
Defamation claims, ordinarily the creature of state law, may be actionable under the Constitution if plaintiff can establish “a stigmatizing statement plus deprivation of a tangible interest [protected by due process].” Slip Op. at 6. The cause of action is known as a “stigma plus” claim.
The Second Circuit reverses because the record strongly indicates that plaintiff’s classification would be 3 “even if he had never been charged with, and acquitted of, sexual assault in the first degree.” Slip Op. at 10. The conviction for first degree assault, involving the mutilation and amputation of the minor victim’s nipple, was itself sufficient to justify the classification. Thus, plaintiff has failed to establish a threshold requirement for his “stigma plus” claim — namely, “a reputation-tarnishing statement that is false.” Slip Op. at 8 (emphasis in original; citation omitted).
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Keywords: CAT, “political opinion”
Panel: Leval, Hall, and Lynch
Opinion by: Lynch
Appeal from: BIA
Result below: Petitions for asylum denied
Result: Vacated and remanded
Guatemalan Police Corruption and Political Asylum
Petitioners, a former Guatemalan police officer and his wife, seek asylum and withholding of removal under the Immigration and Nationality Act (“INA”), 8 U.S.C. §§ 1158, 1231(b)(3), and for relief under the United Nations Convention Against Torture and Other Cruel, Inhuman, or Degrading Treatment or Punishment (“CAT”), Dec. 10, 1984, S. Treaty Doc. No. 100-20, 1465 U.N.T.S. 85 (implemented at 8 C.F.R. §§ 1208-16-18). Petitioner police officer has been subjected to multiple murder attempts as the result of his efforts to root-out corruption in the policing of drug traffickers, including drug trafficking by his immediate supervisors, and other Guatemalan police officers have told his family that he will be killed if he returns to Guatemala. In addition, his brother was murdered.
The Immigration Judge agreed that petitioners established that they would be subjected to torture or worse if returned to Guatemala, but denied the petition on the asserted ground that the likely torture was related to “political opinion” or “membership in a particular social group” as required by the INA.
The Second Circuit holds that the Immigration Judge failed to consider petitioners’ activities in the proper context. Petitioners submitted substantial unchallenged evidence that the reporting of official corruption was inherently political when viewed in the context of the political shifts in Guatemal in the early 2000s, and by failing to evaluation petitioners’ claim against the backdrop of Guatemala’s volatile political history, the IJ “short circuited the analysis”. The IJ’s determination that the police officer was retaliated against for not joining the corruption is flawed. His actions “unquestionably went beyond those of an ordinary policeman reporting a crime” because he not only complained to his chain of command, but also “denounced the corruption he observed to an external international human rights organization set up as part of a political process.” Slip Op. at 25. And he did so after being warned by that organization that his actions were extremely dangerous. Petitioners claim of political persecution “cannot be evaluated in a vacuum… without reference to the relevant circumstances in which the claim arises.” Slip Op. at 27.
Frankly, it is difficult to imagine a more deserving candidate for asylum than a police officer who does his duty to report corruption despite a very real risk that he will be killed for doing so.
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Keywords: UN, functional immunity, self-executing treaty
Panel: Leval, Pooler, and B.D. Parker
Opinion by: Parker
Appeal from: SDNY (Sweet, USDJ)
Result below: Dismissing complaint on immunity grounds
Result: Affirmed
Functional Immunity and Self Executing Treaties
Plaintiffs were employees of the United Nations High Commissioner for Refugees (“UNHCR”) in Geneva, Switzerland. They allege that one of the plaintiffs was sexually harassed by defendant Lubbers, the then-High Commissioner for Refugees, and that the other defendants, including the former Secretary General, covered-up the harassment and retaliated against the plaintiffs.
Defendants moved to dismiss the complaint on grounds of immunity, and defendants’ motion was supported by the United States Attorney for the Southern District of New York. The district court granted the motion to dismiss, holding that the United Nations enjoyed absolute immunity and that the individual defendants were entitled to “functional immunity” because plaintiffs’ allegations concern defendants’ performance of their official functions.
The primary issue on appeal is whether the Convention on Privileges and Immunities of the United Nations (“CPIUN”) dated February 13, 1946 (entered into force with respect to the United States April 29, 1970, 21 U.S.T. 1418) is “self-executing” and therefore applicable and enforceable without additional enabling legislation that was never passed. The Legal Advisor to the State Department, the Foreign Relation Committee’s report, and the executive branch (in the form of the SDNY United States Attorney) all opined that the CPUIN was self-executing, and the Second Circuit agrees that the treaty “became effective at ratification, and therefore is self-executing.” Slip Op. at 5. In addition, the International Organizations Immunities Act of 1945, 22 U.S.C. §§ 288a(b) provides that international organizations designated by the President — and the UN is such an organization — shall receive the same immunity as enjoyed by foreign governments.
Employees of the UN enjoy the same level of immunity as diplomatic envoys; former diplomatic envoys are “functionally immune” from acts performed “in the exercise of [the envoy's] functions.” Only one of plaintiffs’ claims — battery against defendant Lubbers — falls outside of the zone of functional immunity. Because all of plaintiffs’ federal claims are dismissed prior to trial, the single remaining state law claim must be asserted, if at all, in state court.
Plaintiffs’ contention that the immunity here violates a panoply of Constitutional rights is unpersuasive. “[L]egislatively and judicially crafted immunities of one sort or another have existed since well before the framing of the Constitution, have been extended and modified over time, and are firmly embedded in American law.” Slip Op. at 10 (citations omitted).
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Keywords: Electronic Funds Transfers, Statute of Repose, NY UCC § 4-A-505
Panel: Jacobs, CJ, Parker, and Tsouclas (CIT)
Opinion by: Parker
Appeal from: SDNY (Cote, USDJ)
Result below: Dismissing complaint pursuant to NY UCC §4-A-505
Result: Affirmed
Art. 4A - 1 Year Statute of Repose
The question on appeal is whether New York UCC § 4-A-505, which contains a one-year statute of repose for claims based on electronic funds transfers (also known as “wholesale wire transfers”) bars plaintiff’s common law claims, such as breach of fiduciary duty, which have longer statutes of limitations periods. The district court held that it did, and the Second Circuit affirms.
Electronic funds transfers are “series of transactions, beginning with the originator’s payment order, made for the purpose of making payment to the beneficiary of the order” and are completed “by acceptance by the beneficiary’s bank of a payment order for the benefit of the beneficiary of the originator’s payment order.” N.Y. UCC § 4-A-104. A payment order is “an instruction of a sender to a receiving bank, transmitted orally, electronically, or in writing, to pay . . . a fixed or determinable amount of money to a beneficiary [where] the receiving bank is to be reimbursed by debiting an account of . . . the sender.” Id. § 4-A-103. The “sender” is “the person giving instruction to the receiving bank.” The “receiving bank” is “the bank to which the sender’s instruction is addressed.” Id. The “beneficiary” is “the person to be paid by the beneficiary’s bank” and the beneficiary’s bank is “the bank identified in a payment order in which an account of the beneficiary is to be credited pursuant to the order.” Id. The Merrill Lynch wire transfers in issue are electronic funds transfers governed by Article 4A.
Under the UCC, banks bear the risk of loss for unauthorized wire transfers. However, claims that transfers were unauthorized are governed by a one-year statute of repose which provides that:
If a receiving bank has received payment from its customer with respect to a payment order issued in the name of the customer as sender and accepted by the bank, and the customer received notification reasonably identifying the order, the customer is precluded from asserting that the bank is not entitled to retain the payment unless the customer notifies the bank of the customer’s objection within one year after the notification was received by the customer.
Unlike a statute of limitations, which is an affirmative defense against liability and may be subject to tolling, “a statute of repose extinguishes a plaintiff’s cause of action after the passage of a fixed period of time, usually measured from one of the defendant’s acts.” Slip Op. at 6 n. 4 (citing P. Stolz Family P’Ship v. Daum, 355 F.3d 92, 102-03 (2d Cir. 2004)). UCC Article 4-A reflects“a deliberate decision . . . to write on a clean slate and to treat a funds transfer as a unique method of payment to be governed by unique rules” — including the statute of repose — “that address the particular issues raised by this method of payment.” Slip Op. at 8 (quoting N.Y. UCC § 4-A-102 cmt.).The statute of repose is not subject to tolling or interpretation that would create rights, duties, or liabilities that would be inconsistent with Article 4-A. Id.
Although asserted as common-law fraud and fiduciary duty claims, plaintiff’s essential assertion in support of his complaint is that the wire transfers in issue were unauthorized. He does not claim, for example, that he authorized transfers based on false promises, that transfers were misdirected, or that the bank violated the securities laws. Because the claims depend upon unauthorized transfers, they fall squarely within Article 4-A and are subject to the one-year statute of repose, even though the common law claims are subject to longer limitations periods as long as six years. “[W]e have little difficulty concluding that when a legislature imposes a one-year statute of repose on claims alleging injury by an unauthorized electronic transfer, permitting the customer to bring common law claims within a longer limitations period is inconsistent with the legislature’s intent.” Slip Op. at 10 (citing N.Y. UCC § 4-A-505 cmt.).
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Keywords: BIA factual standard of review, jurisdiction, REAL ID Act
Panel: Pooler, Calabresi, and Kahn (USDJ, NDNY)
Opinion by: Kahn
Appeal from: BIA
Result below: Affirming IJ order of removal
Result: Vacated and remanded
erroneous standard of review by BIA
Petitioner, a native of the Dominican Republic, entered the US in 1982 to play professional baseball. He was made a lawful permanent resident in 1989. In 2001, he pleaded guilty to distribution of cocaine. He cooperated with the government and helped obtain convictions of a number of other conspirators, including one who has threatened to have him killed if he ever returns to the D.R.
The immigration law judge initially found that petitioner had proved he would likely be tortured or killed if he was removed, and ordered deferral of removal under the Convention Against Torture, 8 CFR §§ 1208.16(c)(4) and 1208.17(a). The BIA reversed, finding that the “weight of the evidence simply does not indicate” that petitioner would be tortured or killed or that the government would acquiesce in such conduct. On remand, the IJ ordered petitioner’s removal, and the BIA affirmed.
The Second Circuit reverses and remands. The BIA conducted its own fact-finding on the appeal of the initial grant of deferral of removal, which contravenes the statutory standard of review of clear error. 8 C.F.R. §§ 1003.1(d)(3)(i). The BIA’s reversal based on the “weight of the evidence” “cannot be squared with review for clear error.” Slip Op. at 7. The improper standard of review “is the type of error that requires remand.” The BIA also considered new evidence on appeal, when the proper course “would have been either to reject the evidence … or move, sua sponte, to reopen the case before the IJ with the additional evidence.” Slip Op. at 6, n.2. On remand, the BIA is requested to issue a precedential opinion on “whether, as a matter of law, a government may acquiesce to a person’s torture where (1) some officials attempt to prevent that torture (2) while other officials are complicit, and (3) the government is admittedly unable to actually prevent the torture from taking place.” Slip Op. at 12.
Although the Real ID Act (an acronym for the ridiculously named “Rearing and Empowering America for Longevity against acts of International Destruction”) limits jurisdiction over orders of removal to constitutional claims or questions of law, it may not apply to deferral of removal claims under the CAT. The court need not decide that issue, however, because the appeal raises only questions of law. Slip Op. at 5-6.
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Keywords: Cote d’Ivoire, genital mutilation, future persecution, burden of proof, humanitarian asylum
Panel: Calabresi, Cabranes, and Lynch
Opinion by: Lynch
Appeal from: BIA/IJ (Hom, IJ)
Result below: Petition denied
Result: Vacated and remanded
female genital mutilation
The panel overturns the denial of the petition and remands because the Immigration Judge applied the wrong burden of proof. Once the petitioner established that she had been persecuted by being subjected to female genital mutilation, and feared that her daughters, both United States citizens, would be subjected to such mutilation if she were removed, she was entitled to a presumption of future persecution and the burden was then on the government to rebut the presumption.
On remand, the panel suggests that the IJ consider “humanitarian asylum”, which does not require a fear of future persecution.” The panel also notes that petitioner’s return trips to Cote d’Ivoire do not, by themselves, rebut the presumption, nor does the fact that petitioner is no longer herself subject to mutilation.
In addition, the Board may consider on remand “whether the mental anguish of a mother who was herself a victim of genital mutilation who faces the choice of seeing her daughter suffer the same fate, or avoiding the outcome by separation from her child,” may qualify for humanitarian asylum based upon “other serious harm” (8 C.F.R. § 1208.13(b)(1)(iii)) not related to a protected ground.
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Keywords: Perjury, obstruction of justice, acceptance of responsibilty
Panel: Sack, Parker, and Goldberg (CIT)
Opinion by: Goldberg
Appeal from: SDNY (Robinson, USDJ)
Result below: Refuses to reconsider sentence
Result: Affirmed
Acceptance of responsibility and perjury
Defendant was sentenced, on a plea of guilty, to 190 months imprisonment for attempted robbery and discharge of a firearm during the robbery, in violation of 18 U.S.C. § 1951(a) and § 924(c)(1)(A)(iii). Defendant’s trial counsel failed to file a timely notice of appeal. The district court preserved the right to appeal by vacating the sentence and resentencing to the same term of imprisonment.
The main issue on appeal is whether the district court erred in disallowing the plea agreement’s three-level reduction for acceptance of responsibility, and also subjecting defendant to a a two-level enhancement for obstruction of justice, because defendant attempted to absolve his brother of responsibility for the robbery when he testified at his brother’s trial. Defendant’s brother was convicted anyway, meaning that the jury, like the court, believed defendant guilty of perjury.
The Court holds that the district court’s sentence was both procedurally and substantively reasonable. The obstruction of justice enhancement was proper given the relationship of the two cases, see U.S. Sentencing Guidelines Manual § 3C1.1 cmt. n. 1 (1998) (enhancement applies to “an otherwise closely related case, such as that of a co-defendant)), and because defendant committed perjury. The disallowance of the acceptance-of-responsibility reduction was proper because “[t]o determine that [defendant] accepted responsibility, but perjured himself as to significant elements of the offense[,] is incongruous.” Slip Op. at 9.
