Justia Government & Administrative Law Opinion Summaries

Articles Posted in US Court of Appeals for the Second Circuit
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Appellees hold a Foreign Sovereign Immunities Act of 1976 (FSIA) judgment against the Islamic Republic of Iran. Based on that judgment, Appellees moved for a writ of execution against the assets of Kuwait Finance House (KFH) Malaysia in district court. The district court granted the writ before making any findings as to whether KFH Malaysia is an “agency or instrumentality” of Iran or whether the assets at issue are “blocked.” The primary issue on appeal is whether the Terrorism Risk Insurance Act of 2002 (TRIA) permits those assets to be executed prior to such findings.   The Second Circuit denied Appellees’ motion to dismiss the appeal, denied KFH Malaysia’s petition for a writ of mandamus, vacated the order granting the writ of execution, and remanded to the district court for further proceedings. The court explained to be entitled to attachment or execution under the TRIA a plaintiff must first establish defendant’s status as an agency or instrumentality. Here, these procedures were not followed. Article 52 permits parties to commence turnover proceedings to enforce money judgments. Below, that turnover proceeding commenced, but the district court granted the relief sought in that proceeding—a writ of execution—before it considered the antecedent issue of whether KFH Malaysia is an agency or instrumentality of Iran or whether the assets at issue are “blocked.” Without such findings, there has been no showing that KFH Malaysia is in possession of property. Accordingly, Appellees failed to meet the statutory and, and consequently, they failed to establish that they were entitled to a writ of execution. View "Christine Levinson et al. v. Kuwait Finance House (Malaysia) Berhad" on Justia Law

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Plaintiff Pfizer, Inc. brought an action in the United States District Court for the Southern District of New York under the Administrative Procedure Act, 5 U.S.C. Section 706(2), challenging an advisory opinion issued by the United States Department of Health and Human Services Office of Inspector General ("HHS OIG"). Pfizer produces and sells a drug called tafamidis that treats a rare, progressive heart condition known as transthyretin amyloid cardiomyopathy. To make the expensive treatment more affordable, Pfizer proposed a Direct Copay Assistance Program, through which Pfizer would directly cover the cost of a patient's co-pay for tafamidis.    HHS OIG issued an advisory opinion stating that the Direct Copay Assistance Program would violate the federal Anti-Kickback Statute, 42 U.S.C. Section  1320a-7b(b)(2)(B). The district court granted summary judgment to defendants, rejecting Pfizer's argument that liability under the Anti-Kickback Statute requires an element of "corrupt" intent.   The Second Circuit affirmed the decision holding that the agency’s interpretation of the Anti-Kickback Statute is not contrary to law. Specifically, the court explained that it has no doubt that hat at least some kind of quid pro quo, direct or indirect, exists here. However, the court does not think it is the case that every quid pro quo is inherently corrupt. Thus, while Pfizer relies heavily on two cases to argue that the word "induce" implies corruption. Neither supports its position. View "Pfizer, Inc. v. HHS" on Justia Law

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Plaintiff, a police officer for the Metropolitan Transportation Authority (“MTA”), sued the MTA under the Federal Employers’ Liability Act (“FELA”), alleging that the MTA negligently failed to provide him with a safe workplace when it sent him on patrol in a vehicle without a prisoner compartment. A jury found the MTA liable and awarded Plaintiff damages. The MTA moved for judgment as a matter of law notwithstanding the verdict, arguing that it is immune from liability pursuant to the governmental function defense and that the evidence was insufficient to support the verdict because it lacked expert testimony. The district court denied that motion, holding that the governmental function defense does not apply in FELA cases.   The Second Circuit affirmed the district court’s judgment. The court held that the FELA does not abrogate the governmental function defense, and therefore the defense is available in FELA cases. Though the governmental function defense was available for the MTA to assert, the MTA failed to show that the defense barred liability in this case. Here, the defense did not apply on the merits in this case, however, because the MTA has failed to show that it performed a discretionary governmental function when committing the allegedly negligent acts. Additionally, the court held that expert testimony was not required in this case. Further, the court could not say that the evidence supporting the jury’s verdict for Plaintiff was legally insufficient. View "Ojeda v. MTA" on Justia Law

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Connecticut State Police Union (“CSPU”) brought suit against the Commissioner of Connecticut’s Department of Emergency Services and Public Protection (the “Commissioner”), alleging that the FOIA-related portions of the state law violated the Contracts Clause and moved for a preliminary injunction. The law at issue is Public Act 20–1: An Act Concerning Police Accountability (“the Act”). Section 8 of the Act took aim at FOIA exemptions under Connecticut law.   The district court denied the motion primarily on the ground that the CSPU was unlikely to succeed on the merits of its claim since the law was reasonable and necessary to promote transparency and accountability for law enforcement. The Second Circuit affirmed concluding that the law served a legitimate public purpose and that the legislature, in passing it, acted not self-servingly but in the public interest.   The court explained that determine whether a law violates the Contracts Clause, it asks (1) whether the contractual impairment is substantial, (2) whether the law serves “a legitimate public purpose such as remedying a general social or economic problem,” and (3) whether the means chosen to accomplish that purpose are reasonable and necessary.  Here, the Act served two legitimate public purposes: ensuring the transparency and accountability of law enforcement and promoting “FOIA’s strong legislative policy in favor of the open conduct of government and free public access to government records.” Moreover, because the district court did not err in concluding that the CSPU could not succeed on the merits of its claim, the court did not need to address the remaining prongs of the preliminary injunction test. View "Conn. State Police Union v. Rovella" on Justia Law

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Plaintiff A&B Alternative Marketing Inc. (“A&B”) filed a Complaint against Defendants, International Quality Fruit Inc. (“IQF”), H&A International Fruit 14 Corp. (“H&A”), and others alleging violations of the Perishable Agricultural Commodities Act (“PACA”) stemming from Defendants’ failure to pay A&B for produce purchased on credit.   The District Court entered an order denying Defendants’ 12(b)(1) motion and granting A&B’s motion for default judgment. Defendants challenged the District Court’s order only on the grounds that it lacked subject-matter jurisdiction to adjudicate A&B’s claims. The Second Circuit affirmed the district court’s judgment. The court reasoned that neither of the two statutory requirements Defendants relies on is jurisdictional.   Defendants asserted that A&B failed to show that Defendants engaged in the business of selling in wholesale or jobbing quantities and that the invoice cost of their purchases of perishable agricultural commodities in any calendar year was in excess of $230,000.  But A&B alleges that both IQF and H&A “purchased perishable agricultural commodities exceeding $230,000.00 annually and/or purchas[ed] at least 2,000.00 lbs. of perishable agricultural commodities on any one day.”  Accordingly, A&B has sufficiently shown that Defendants meet the relevant statutory requirements.   Second Defendants claimed that A&B failed to provide evidence that the alleged transactions were carried out in “interstate or foreign commerce.” However, A&B submitted evidence that it purchased the produce in question from Pennsylvania growers or merchants for resale in New York. View "A&B Alternative Mktg. Inc. v. Int'l Quality Fruit Inc., et al." on Justia Law

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Defendants-Appellants the United States Citizenship and Immigration Services (“USCIS”), the United States Department of State (“DOS”), and the United States Immigration and Customs Enforcement (“ICE”) appealed from three orders of the district court for the Southern District of New York requiring they produce certain documents in response to FOIA requests filed by the Knight First Amendment Institute at Columbia University (“Knight”). The court reasoned that FOIA is premised on “a policy strongly favoring public disclosure of information in the possession of federal agencies.” Halpern v. F.B.I., 181 F.3d 279 (2d Cir. 1999). However, in some circumstances, Congress determined that other interests outweigh the need for transparency. These circumstances are embodied by a limited set of four statutory exemptions from FOIA’s disclosure requirements.Here, the court found that DOS established that the document includes specific guidance to DOS employees on detecting ties to terrorism. Thus, DOS and USCIS properly withheld the first two sets of documents under FOIA Exemption 7(E). However, the court remanded on the ICE issue because the record was unclear regarding whether ICE complied fully with the district court’s order. View "Knight v. USCIS et al." on Justia Law

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Springfield, debtors in bankruptcy who applied for and were denied Paycheck Protection Program (PPP) funds pursuant to the CARES Act solely due to their bankruptcy status, initiated this adversary proceeding in bankruptcy court against the Administrator of the SBA, in her official capacity. Springfield challenges the SBA's administration of PPP funds and asks that the bankruptcy court enjoin the SBA from denying its PPP application on the basis of its bankruptcy status.The Second Circuit held that, based upon the plain language of Section 525(a) of the Bankruptcy Code, that the PPP is a loan guaranty program and not an "other similar grant," and Section 525(a) does not apply to the PPP. Therefore, the bankruptcy court incorrectly ruled that Springfield was entitled to summary judgment and a permanent injunction. Rather, the court concluded, as a matter of law, that summary judgment in the SBA's favor is warranted on the Section 525(a) claim, reversing the judgment and vacating the permanent injunction. The court remanded to the bankruptcy court for further proceedings. View "Springfield Hospital, Inc. v. Guzman" on Justia Law

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Objectors challenged the district court's judgment approving a class action settlement that includes Freddie Mac, with FHFA as its conservator, as a member of the plaintiff settlement class and enjoins FHFA from further pursuing Freddie Mac claims that were at issue in the action. The Second Circuit rejected FHFA's contention that the Housing and Economic Recovery Act of 2008 (HERA) deprived the district court of subject matter jurisdiction to treat FHFA or Freddie Mac as a member of the settlement class or to rule that conservatorship assets were within the scope of the settlement.However, the court concluded for other reasons that the district court's March 8, 2019 prejudgment ruling that FHFA is a member of the settlement class was erroneous. The court explained that the Settlement Class, as certified by the district court, consists of persons and entities who purchased or otherwise acquired interests in the NovaStar bonds "prior to May 21, 2008." However, because FHFA did not succeed to the interests of Freddie Mac until September 6, 2008, it acquired no interest in Freddie Mac's NovaStar bonds until that date. Therefore, FHFA is not a member of the Settlement Class and the court modified the judgment to reflect the court's ruling. View "N.J. Carpenters Health Fund v. NovaStar Mortgage, Inc." on Justia Law

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The CIA appealed the district court's amended judgment ordering it to make public certain information contained in a draft summary of the CIA's former detention and interrogation program, as well as the transcript of certain ex parte proceedings before the district court. In a partially redacted opinion, the Second Circuit agreed with the CIA that certain information was properly withheld under Exemption 1 of the Freedom of Information Act. The court reversed and remanded for further proceedings. View "American Civil Liberties Union v. Central Intelligence Agency" on Justia Law

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Class members are Medicare Part A beneficiaries who are formally admitted to a hospital as "inpatients" before their subsequent reclassification as outpatients receiving "observation services." Plaintiffs filed suit alleging that the Secretary violated their due process rights by declining to provide them with an administrative review process for the reclassification decision. The district court entered an injunction ordering the creation of such a process.The Second Circuit affirmed, concluding that the named plaintiff had standing by demonstrating that they suffered a financial injury as a result of being reclassified as receiving observations services; the failure of the Secretary to provide an appeals process for the reclassification decision implicates the same set of concerns—namely, a loss of Part A coverage—for both the named plaintiffs and the absent class members; and the litigation incentives are sufficiently aligned so that the named plaintiffs can properly assert claims on behalf of those class members who will be hospitalized in the future. The court also concluded that the district court properly certified the plaintiff class and that the class satisfies the commonality and typicality requirements. Furthermore, the plaintiff class was properly certified under Federal Rule of Civil Procedure 23(b)(2).The court concluded that the district court did not clearly err by finding that plaintiffs' due process rights are violated by the current administrative procedures available to Medicare beneficiaries. In this case, plaintiffs have demonstrated that the Secretary violates their due process rights when utilization review committees reclassify them from inpatients to those receiving observation services without providing a mechanism to appeal that decision. View "Barrows v. Becerra" on Justia Law