Justia U.S. 6th Circuit Court of Appeals Opinion Summaries

Officers responded to a call describing a male yelling for help outside an apartment, followed by a report that a naked male entered a nearby apartment. Approaching, Tieber encountered a naked male, Martin, age 19, running and speaking nonsensically. Martin asked for help, then “jogged away.” Tieber ran and fell on Martin’s back. Semanco dropped his knee into Martin’s side, fell on top of both men, and delivered “compliance body shots.” Martin bit Tieber; Tieber struck Martin’s face. Semanco struck Martin’s face, back, and ribs at least five times. Tieber folded his legs around Martin’s hips and gripped Martin’s chin with his arm. As Tieber and Semanco attempted to secure Martin’s arms, Zimmerman kneeled on Martin’s calves. Officers heard a “gurgling sound.” They rolled an unresponsive Martin onto his side, tried to resuscitate him, and called paramedics. Martin died. The coroner determined that Martin died from an acute psychotic episode with excited delirium due to LSD intoxication and cardiopulmonary arrest. The pathologist who conducted the autopsy noted injuries suggesting asphyxiation. A pathologist hired by Martin’s estate agreed. The department had a use-of-force policy, and a “Positional Asphyxia Policy” that warns that a person, psychotic due to mental illness or drugs or alcohol, is particularly susceptible to death. Two officers said they never considered this policy. In the estate’s suit under 42 U.S.C. 1983, the district court denied the officers summary judgment on qualified immunity. The Sixth Circuit affirmed. View "Martin v. City of Broadview Heights" on Justia Law

Martello, a doctor with a law degree, never passed the bar exam despite four attempts; in 1997 she passed the Multistate Professional Responsibility Examination. In 1991, Martello started reviewing medical malpractice cases for Santana, who paid an hourly rate. She alleges that they changed the arrangement for three cases and that Santana wrote that he would pay Martello 20 percent of his fee if the case settled before filing and 25 percent if the case settled after filing suit. Martello alleges that the document was intended to cover future cases. Later, Santana sent Martello a letter stating that: Kentucky canons of ethics prohibit the payment of your fees for assisting … on a contingency basis … you will be billing us on an hourly basis. Martello claims that Santana told her to fabricate time to earn the equivalent of what she would have received under the contract. Martello was dissatisfied with what she received and sued. The district court determined that Martello’s contract claims were barred because the contracts were void as against public policy, while her fraud claims, even accepting tolling agreements, were barred by the statute of limitations. The Sixth Circuit affirmed. View "Martello v. Santana" on Justia Law

In 1977, the Environmental Protection Agency sued Michigan, Detroit, and the Detroit Water and Sewerage Department for exceeding effluent limitations and failing to satisfy monitoring requirements under the Clean Water Act, 33 U.S.C. 1251. In 1977, the district court entered an initial Consent Judgment. Over the next 30 years, the DWSD fell in and out of compliance. In the most recent round of violations and court orders, the district judge gave a committee of local officials 60 days to fashion a final plan or face more intrusive court-ordered remedies. The judge adopted most of the committee’s recommendations but also directly abrogated some provisions in collective bargaining agreements of approximately 20 different bargaining units. None of the DWSD unions were parties. Unions sought to intervene. The district court denied the motions as untimely. The Sixth Circuit reversed. Although the unions were aware of the potential significance of the proceedings and failed to intervene before the court-approved committee returned its recommendations, total denial of intervention was an abuse of discretion. The unions have substantial interests at stake that “may as a practical matter” be impaired absent intervention. While concerns of delay and re-litigation are serious, they can be alleviated by limiting the scope of intervention. View "Unted States v. City of Detroit" on Justia Law

In 2004, El Camino executed equipment leases with Cyberco, a corporation held out to be a computer sales and consulting business. Cyberco actually operated under several names and was engaged in fraud. Its affiliate, Teleservices, a shell corporation, was represented as an arms-length computer manufacturer. The equipment to be leased by El Camina, which likely never existed, was allegedly manufactured by Teleservices and delivered to Cyberco, which released payment to Teleservices. In 2002, Huntington established a banking relationship with Cyberco. Cyberco used its accounts to deposit funds from El Camino. Huntington investigated a series of overdrafts. Ultimately Cyberco elected to undergo a “gradual migration” from Huntington, and Huntington agreed to credit extensions for Cyberco during the transition. El Camino purchased more than $25 million in computer equipment. El Camino sued Huntington for conversion, aiding and abetting conversion, aiding and abetting fraud, and unjust enrichment. The district court granted summary judgment on the first three claims, concluding that El Camino could not establish the requisite level of knowledge to sustain aiding and abetting and conversion claims. It later dismissed the unjust enrichment claim. The Sixth Circuit affirmed, stating that findings, in a related bankruptcy case, that Huntington did not act in good faith, were irrelevant. View "El Camino Res., LTD. v. Huntington Nat'l Bank" on Justia Law

Kerman founded Kenmark. By 2000 its annual sales of eyeglass frames approached $35 million. Kerman’s personal net worth topped $12.5 million. Kerman was Kenmark’s sole owner until 2000, when Kerman sold 27 percent of his stock for $6.1 million to Kenmark’s employee stock ownership plan, realizing a taxable gain of $5.4 million. Kerman consulted his financial advisor and pursued a “Custom Adjustable Rate Debt Structure,” tax-saving strategy. A British company (not subject to U.S. tax law) borrowed foreign currency from a foreign bank; the U.S. taxpayer would receive some of the borrowed currency, would agree to be jointly liable for the entire loan, and would exchange his portion of the foreign currency for dollars. A currency exchange is taxable. The taxpayer would claim that the currency’s basis was the full loan amount, not the small amount of currency actually purchased. Because of the inflated basis, the taxpayer would claim a loss. The dollars would be deposited in the same foreign bank with the balance of the foreign currency and be used to pay off the loan. The IRS disallowed the deduction and imposed a penalty, 26 U.S.C. 6662(e), 6662(h). The tax court and Sixth Circuit affirmed, finding that the transaction lacked economic substance and Kerman lacked good faith to believe that it did. View "Kerman v. Comm'r of Internal Revenue" on Justia Law

Hammond was convicted of possession with intent to distribute cocaine base. A presentence report noted that the mandatory minimum term was 120 months. At sentencing, the district court determined that a two-level enhancement for possession of a firearm did not apply and that category II overrepresented Hammond’s criminal history. Based on a total offense level of 32 and a criminal history category of I, the district court considered a range of 121 to 151 months and imposed a 121-month sentence. In 2012, Hammond moved for reduction of sentence under 18 U.S.C. 3582(c)(2) and the Fair Sentencing Act of 2010, which increased the amount of cocaine base necessary to trigger mandatory minimum sentences, 124 Stat. 2372. Revised penalties were made retroactive in 2011. The Probation Office advised that Hammond’s total offense level should be reduced by two levels to level 30, resulting in a guidelines range of imprisonment of 120 to 135 months. The district court reduced his sentence to 120 months. The Sixth Circuit affirmed. The district court applied all applicable retroactive amendments had no authority to further reduce the sentence. View "United States v. Hammond" on Justia Law

TracFone provides prepaid wireless phone service primarily through third-party retailers. The Commercial Mobile Radio Service Emergency Telecommunications Board, created by the Kentucky General Assembly to develop an emergency 911 system for wireless customers, sued to collect unpaid fees from TracFone. KRS § 65.7635 requires wireless providers to collect a fee from their customers and remit the money to the CRMS for the cost of maintaining the 911 system. The district court ruled in favor of the Board with respect to the interpretation of the statute but declined to award prejudgment interest on TracFone’s unpaid fees. The Sixth Circuit affirmed, rejecting an argument concerning ambiguity in the statute. TracFone was required to remit fees from the effective date of the statute, regardless of what method it chose. View "KY Commercial Mobile Radio Serv. Emergency Telecommunications Bd. v. Tracfone Wireless, Inc." on Justia Law

The Securities and Exchange Commission filed a civil enforcement action against 12 defendants, alleging that they violated registration, disclosure, and anti-fraud provisions of federal securities law, in connection with a “reverse merger” that involved creation of a shell company for the purpose of OTC trading, followed my merger of a private company into the shell, with an exchange of stock. A reverse merger enables a private company to access public markets without undertaking the expensive process of an initial public offering. One of the defendants, Tsai, has formed more than 100 shell companies.The district court granted the SEC partial summary judgment and granted permanent injunctions against the defendants. Tsai appealed. The Sixth Circuit affirmed entry of the injunction. Tsai’s failure to challenge findings with respect to his industry experience and education means the court did not abuse its discretion in finding he had at least some degree of scienter. View "Secs. & Exch. Comm'n v. Sierra Brokerage Servs, Inc." on Justia Law

Howard has been employed as an underground face coal miner with CRCC since 2005 and has filed seven prior discrimination complaints under the Mine Act, 30 U.S.C. 815(c)(1), alleging that: CRCC assigned him undesirable jobs because of his demanding nature; CRCC reduced the workforce to fabricate justifications to terminate him; and CRCC failed to protect his truck from vandalism in the parking lot. After Howard suffered an injury at work, CRCC fired him, stating that restrictions imposed by a physician made him unable to perform any job available at CRCC. An ALJ found discrimination and that the justification was pretextual. The Federal Mine Safety and Health Review Commission denied review. The Sixth Circuit affirmed. Howard’s seven-percent impairment was found to be minimal and unthreatening for his continued employment at the coal mine by all of his treating physicians; only after CRCC sent an overbroad job description and a brief clarification questionnaire did on doctor find that Howard should not return to work. View "Cumberland River Coal Co. v. Fed. Mine Safety & Health Review Comm'n" on Justia Law

Cogent sued, alleging that Hyalogic was disseminating false information regarding Cogent’s product Baxyl, an “oral, liquid HA supplement that is sold into the human natural products market.” Shortly after the filing, the parties entered into a settlement agreement. Cogent moved to enforce the settlement agreement, claiming that Hyalogic caused false and misleading videos to be uploaded to You Tube and by statements made at a conference. The district court found no breach of the settlement agreement and denied the motion. The Sixth Circuit affirmed. The contract unambiguously refers to a clear statement “about the other Party’s product.” Statements that refer to preservatives that can be found in a number of products, including Cogent’s products, are not statements “about the other Party’s products.” View "Cogent Solutions Grp, LLC v. Hyalogic, LLC" on Justia Law