Justia Government & Administrative Law Opinion Summaries

Petitioner Accord Human Resources, Inc. (Accord) is a professional employer organization that transacts business in Colorado along with four related entities. In 2004, Accord transferred a portion of its Colorado employees to another Accord entity with a lower unemployment tax rate and in doing so, reduced its unemployment tax burden. The Colorado Division of Employment and Training determined that it had authority to treat the various Accord entities as one for purposes of assessing unemployment taxes, thus erasing any tax advantage that could be gained through the employee transfer. Under this rationale, the Division issued a delinquent tax notice to Accord. Accord appealed, and the hearing officer reversed. On appeal, the court of appeals reversed the Industrial Claim Appeals Office's Final Order and reinstated the hearing officer's decision. The Division sought to reverse the court of appeals decision. Upon review, the Supreme Court affirmed the appellate court's decision, finding that nothing gave the Division authority to combine separate employer tax accounts into one account for purposes of assessing unemployment taxes.

Relators brought a qui tam action against defendant and its subsidiaries, alleging violations of the reverse false claim provision of the False Claims Act (FCA), 31 U.S.C. 3729(a)(7). Relators subsequently appealed the district court's dismissal, with prejudice, of their third amended complaint for failure to state a claim upon which relief could be granted. The district court held that relators failed to allege with particularity, as required by Rule 9(b), that defendants knowingly made false statements for the purpose of concealing or avoiding an obligation to pay money to the government. Count I alleged that the 2008 Certification of Compliance was false due to the failure to report or remit the million dollars in identified Overpayments, and that defendants made and used the Certification to conceal and avoid the obligation to remit Overpayments. Count II involved the same obligation to remit Overpayments within thirty days but was based on a separate scheme and separate false records. The court held that relators have sufficiently pled each element of a reverse false claim for the Certification of Compliance and the district court's dismissal of Count I was reversed. The court also held that relators have pled all the remaining elements for a reverse false claim for the Discovery Samples and thus, the district court's dismissal of Count II was reversed.

The Industrial Commission and Slawson Exploration Company appealed a district court judgment that reversed the Commission's assessment of a risk penalty against Gadeco, LLC. The issue in this case arose from a challenge to the validity of an invitation to participate in the cost of drilling a well which resulted in the Commission's assessment of a 200 percent risk penalty. Because the Supreme Court was unable to discern the basis for the Commission's decision, the Court reversed the judgment and remanded the case back to the Commission for the preparation of findings that explain the reasons for its decision.

Plaintiff sued the State to challenge a demand for payment made by the State under Delaware's escheat law, 12 Del. C. 1101, et seq. The State countersued, seeking a declaration that the sums demanded from plaintiff were proper and authorized under the Statute. Both parties moved for partial judgment on the pleadings. The court found that the rebates at issue fit comfortably within two of the "specifically enumerated" items of property listed in section 1198(11) and therefore granted the State's motion for partial judgment on the pleadings and denied plaintiff's cross-motion. Although the pleadings did not paint a clear picture of the form in which the rebates were issued by plaintiff to its customers, plaintiff's counsel conceded at oral argument that the rebates were issued as either negotiable "checks" or "credits." As such, the rebates consisted of specifically enumerated items of property under section 1198(11), and the State's claims could not be barred by any statute of limitations.

Petitioner National Labor Relations Board (the Board or NLRB) sought enforcement of its order against Respondent Contemporary Cars, Inc. (Contemporary). In 2008, the International Association of Machinists and Aerospace Workers (the Union) filed a petition with the Board seeking certification as the representative of Mercedes-Benz service technicians employed at Contemporary. The Board held a hearing, determined the proposed bargaining unit was appropriate under two different theories, and directed that an election occur. Contemporary requested that the Board review the Regional Director’s decision regarding the bargaining unit. Despite only having two members, the Board summarily denied the request. Members of the bargaining unit voted in for representation by the Union, and the Regional Director certified the Union. To preserve its right to challenge the validity of the bargaining-unit determination in a court of appeals, Contemporary refused to bargain. The Union filed an unfair labor practice charge with the Board. Contemporary conceded the violation, and in 2009, the two-member Board issued an order finding Contemporary in violation of the National Labor Relations Act (the Act). Contemporary filed a petition for review of the NLRB’s order with the federal district court. The NLRB cross-petitioned seeking enforcement. The circuit court granted Contemporary's motion to hold the case in abeyance pending the Supreme Court's decision in "New Process Steel, L.P. v. NLRB" (130 S. Ct. 2635 (2010)). In 2010, the NLRB issued an order setting aside its previous two-member decision to "take further action as appropriate." The original two members plus an obligatory third member issued a new order, again affirming the Regional Director's bargaining-unit decision. The NLRB subsequently filed a petition for enforcement of its order with the Eleventh Circuit. Upon review, the Court found that it lacked jurisdiction to consider Contemporary's due process challenge raised on appeal of the 2010 NLRB order. Furthermore, Contemporary did not meet its burden of demonstrating the Board's determination lacked substantial evidentiary support. Therefore, the Court granted the NLRB's petition.

Plaintiffs-Appellants James and Sandra Lindquist sued the City of Pasadena alleging the City violated their state and federal constitutional rights by exercising "unbridled discretion" in connection with the denial of a zoning waiver. Plaintiffs operated a used-car dealership in Pasadena. In 2003, the Pasadena City Council enacted an ordinance adopting licensing standards for used-car dealers criminalizing the sale of used cars without a license and imposing a number of requirements that dealers must meet as a condition of receiving a license. Two of those requirements were the subject of this appeal: (1) new license locations are required to be a minimum of one-thousand feet from any existing license; and (2) no new licenses could be issued within 150 feet of a residential area. After the ordinance was passed, Plaintiffs considered purchasing two lots to expand their existing dealership. City officials told them that neither lot qualified for a license, but Plaintiffs purchased the lots anyway. Plaintiffs later learned that their competitors purchased a nearby lot, had applied for a license, and were denied for different reasons than those given to Plaintiffs. On appeal, the Fifth Circuit reversed the district court's ruling that Plaintiffs' equal protection claim failed to state a claim for relief. On remand, the district court granted summary judgment to the City after determining Plaintiffs failed to create a genuine issue of fact with respect to their equal protection claim. Upon review, the Fifth Circuit concluded that Plaintiffs could not show that the City Council acted irrationally when it denied their license appeal. Furthermore, the Court found that Plaintiffs failed to preserve their unbridled discretion claim for further review. As such, the Court affirmed the district court's grant of summary judgment in favor of the City.

McLane Southern, Inc. is a Mississippi wholesaler of tobacco products that sells smokeless tobacco to retail establishments in Louisiana. The issue on appeal before the Supreme Court was whether the company was liable for excise taxes pursuant to the state Tobacco Tax Law. Finding that the law imposes an excise tax on smokeless tobacco products be paid by the dealer who first sells, uses, consumes, handles or distributes the product in Louisiana, the Supreme Court reversed the court of appeal's judgment and remanded the case for further proceedings.

Wright Brothers Construction Company, Inc. and GIBCO Construction petitioned the Supreme Court for a writ of mandamus to direct the circuit court to vacate its order that denied their motion to transfer their case to another circuit court. In 2008, Rogers Whited was involved in a two-vehicle accident at a quarry located in Jefferson County. Both Whited and the driver of the other vehicle were employed by GIBCO, who, along with Wright Brothers, was engaged in a project at the quarry. In 2010 Whited filed a complaint against Wright Brothers, GIBCO, and Sharon Gilbert, the owner and president of GIBCO, in the Walker Circuit Court seeking damages for personal injuries allegedly caused by the accident. In May 2010 Wright Brothers moved to transfer the action to Jefferson County, stating that Whited alleged in his complaint that he was a resident of Blount County, that the accident occurred in Jefferson County, and that therefore Jefferson County, not Walker County, was the proper venue for Whited's action. In June, Whited filed his response in opposition to Wright Brothers' motion, stating that he was a resident of Walker County, not Blount County. Contemporaneously with that response in opposition, Whited also filed an amendment to his complaint stating that his statement that he was a resident of Blount County was a "clerical error." Upon review, the Supreme Court found that the proper venue for this case was Jefferson County, and that the trial court had "an imperative duty to transfer the case and refused to do so." Accordingly, the Supreme Court granted Wright Brothers' petition and issued the writ.

Jim Walter Resources, Inc. (JWR) sought a petition for a writ of mandamus to direct the Tuscaloosa County Probate Court to record certain filings without the payment of a recording tax. Walter Energy, JWR's parent company, acquired Western Coal Corporation of Canada. As part of the acquisition, Walter entered into a credit agreement with Morgan Stanley, which required Walter's subsidiaries to execute contingent guaranties of Walter's financing debt in the event Walter defaulted. JWR secured its guaranty of Walter Energy's financing debt by executing mortgages on its real and leasehold properties. Also as part of the credit agreement, JWR was required to record the mortgages in the probate offices in the counties in which the properties were located. When JWR sought to record the mortgages and related UCC filings in Tuscaloosa, the Tuscaloosa County Probate Court refused to record the documents unless JWR paid the recordation tax. The probate judge maintained that there was no statutory requirement that under Alabama law that the debt being secured be the mortgagor's debt, and as such, because JWR was recording its financing statements for Walter's debt, JWR was still responsible for paying the tax. Upon review, the Supreme Court found that JWR's liability was contingent on Walter's default, and JWR's contingent guaranty did not constitute an unqualified promise to pay Walter's indebtedness under the credit agreement. The Court found the contingent guaranty was not within the scope of the applicable statute, and accordingly, the Court granted JWR's petition and issued the writ.

Petitioner-Appellant Jean Mathia is the widow of Doyle Mathia, who was a limited partner in Greenwich Associates. Greenwich was a partnership that incurred losses that were passed through to the couple’s income tax returns for the years 1982–84. After an investigation of numerous related tax shelters, the Commissioner of Internal Revenue disallowed these losses. Petitioner was assessed more than $150,000 in taxes following lengthy administrative and judicial proceedings involving the partnership. Petitioner appealed to the United States Tax Court to challenge the assessments as untimely, and to assert that the government bore the burden of proof in establishing timeliness. The Tax Court denied the appeal. On appeal to the Tenth Circuit, Petitioner contended the tax assessments were untimely because the relevant statute of limitations had run. The Tenth Circuit concluded that Petitioner's contention turned on whether Mr. Mathia entered into a settlement agreement under the tax code that resolved his partnership tax liability on an individual basis. The Court agreed with the tax court that he entered into no such agreement which would have qualified under the tax code as a settlement of Mr. Mathia's liability as an individual partner. Therefore, the Court concluded the assessments were timely and properly applied by the IRS.