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

Water flows through Old Hickory Dam on the Cumberland River toward Nashville. The Dam’s reservoir is divided into three pools. If water exceeds the capacity of the surcharge pool, the Army Corps of Engineers must accelerate discharges through the dam to prevent it from being destroyed. The surcharge pool is kept empty except during floods. An unprecedented storm swept through the Cumberland River Basin on May 1–2, 2010. Water was kept at its usual depth even though the Corps was aware of the forecast; discharges through the dam were not increased until a flood emergency was declared. Releases were less than the natural flows from the rainfall and the stormwater draining into the reservoir. While the Corps’ manager was absent, water levels in the reservoir rose in the surcharge pool. When the water level had risen to the top of the surcharge pool, the Corps was forced to release massive volumes of water, but never warned downstream residents about the unprecedented discharge. The discharged waters reached the Nashville area, breaching levees and destroying and damaging property. The Sixth Circuit affirmed dismissal, reasoning that the claims are barred by the discretionary function exception to the Federal Torts Claims Act. View "Cont'l Ins. Co. v. United States" on Justia Law

Tyler was involuntarily committed to a mental institution, 28 years ago, for less than one month after allegedly undergoing an emotionally devastating divorce. He sought a declaratory judgment that 18 U.S.C. 922(g)(4) is unconstitutional as applied to him. The statute provides: It shall be unlawful for any person . . . who has been adjudicated as a mental defective or who has been committed to a mental institution . . . to ship or transport in interstate or foreign commerce, or possess in or affecting commerce, any firearm or ammunition; or to receive any firearm or ammunition which has been shipped or transported in interstate or foreign commerce. The district court dismissed. The Sixth Circuit reversed and remanded, holding that Tyler’s complaint validly states a violation of the Second Amendment. The government’s interest in keeping firearms out of the hands of the mentally ill is not sufficiently related to depriving the mentally healthy, who had a distant episode of commitment, of their constitutional rights. The government acknowledged that it currently has no reason to dispute that Tyler is a non-dangerous individual. View "Tyler v. Hillsdale Cnty. Sheriff's Dep't" on Justia Law

In 2009, Krul, a convicted felon, took a 9mm Glock handgun out of his friend’s basement to use as collateral for a drug deal, but the dealer refused to return it to Krul after the deal was completed. A chain of transfers took the weapon to Dantzler, who used the weapon on a murderous spree. The one to whom Krul initially transferred the gun cooperated with authorities, and eventually Krul and the one that transferred the weapon to Dantzler were indicted. Krul pled guilty to being a felon in possession of a firearm, 18 U.S.C. 922(g)(1). The Sentencing Guidelines range was 51 to 63 months. The court sentenced Krul to 63 months of imprisonment, followed by three years of supervised release with various strict conditions. On appeal, Krul argued that some of the court’s statements during sentencing imply that the court impermissibly factored rehabilitation into the length of his prison sentence. The Sixth Circuit rejected the claim: the district court carefully considered rehabilitation for other, permissible purposes and Krul invited the discussion of rehabilitation by emphasizing rehabilitation during his own statement. The court had emphasized Krul’s extensive criminal history since age 14 and the need to protect the public. View "United States v. Krul" on Justia Law

Michigan corrections officers must perform several pre-shift and post-shift activities, including “punching a mechanical time clock,” “waiting in line” for security, and “walking to assigned locations.” These activities take place off the clock. Corrections officers and their union filed suit under the Fair Labor Standards Act and state law to recover overtime payments, 29 U.S.C. 206, 207; Mich. Comp. Laws 408.414, .414a. The Michigan Department of Corrections successfully moved to dismiss for lack of jurisdiction on sovereign immunity grounds. The Sixth Circuit affirmed. Without a past (or imminent future) violation of the Fourteenth Amendment, Congress has no remedial power under Section 5 to authorize private lawsuits against the states; absent permissible Section 5 legislation abrogating the state’s immunity from suit, federal courts lack jurisdiction to entertain these FLSA claims against the Department of Corrections or to grant a declaratory judgment under Ex parte Young against the Department’s director, to address an alleged ongoing violation of the FLSA. View "Mich. Corrs. Org. v. Mich. Dep't of Corr." on Justia Law

Kopko ran SFS in Michigan, providing financial transaction processing and electronic funds transfers to companies engaged in e-commerce, processing those transactions through its Fifth Third account, Fifth Third discovered that FBD was processing illegal gambling funds through that account and notified SFS that it was closing SFS’s account immediately. Losing this account crippled SFS’s ability to do business. SFS went bankrupt. Kopko telephoned FBD and spoke to Bastable, FBD’s vice-president for e-commerce. According to Kopko, Bastable said FBD did not have an account in SFS’s name. Months later SFS received a grand jury subpoena related to a federal investigation of the gambling transactions done in SFS’s name. When Kopko called Bastable again to discuss the subpoena, Bastable admitted that FBD had an account in SFS’s name and that the board of directors was aware of this account. In 2012, SFS sued FBD, Bastable, and FBD’s individual directors in federal court for negligence and fraud against. The district court dismissed. The Sixth Circuit affirmed that: answering the phone calls did not establish personal jurisdiction over individual defendants; FBD owed no duty of care to SFS because SFS was not a customer; and SFS failed to adequately plead a claim of fraud. View "SFS Check, LLC v. First Bank of De." on Justia Law

P&C filed suit on behalf of Penn, LLC against Prosper Corporation, Prosper’s owners, and their counsel, the Arnold Firm, alleging violations of the Racketeering Influenced and Corrupt Organizations Act, fraud, conversion, unjust enrichment, and breach of fiduciary duty in connection with the management of Penn and Prosper’s joint venture, BIGresearch. There had been court and arbitration proceedings since 2004, but Penn never before named the Arnold Firm as a defendant. The Arnold Firm served P&C with a letter purporting to satisfy the obligations of Fed. R. Civ. P. 11, threatening to seek sanctions if the matter was not dismissed, and claiming that the action was frivolous and had been filed for the “improper and abusive purpose” of disrupting the Arnold Firm’s attorney-client relationship with Prosper and its owners. The district court ultimately dismissed the Arnold Firm from the action, but denied a motion for Rule 11 sanctions against P&C. The Sixth Circuit affirmed on the alternative ground that the Arnold Firm’s failure to comply with Rule 11’s safe-harbor provision made sanctions unavailable. The Arnold Firm’s warning letter expressly reserved the firm’s right to assert additional grounds for sanctions in its actual motion. View "Penn, LLC v. Prosper Bus. Dev. Corp." on Justia Law

Miner marketed two schemes that promised to avoid taxes. Miner’s first scheme, IRx Solutions, offered to assist clients in requesting alterations to their Individual Master Files (IMFs), which are internal IRS records pertaining to each taxpayer. Miner claimed that the IRS was engaged in widespread fraud by improperly coding individuals as businesses on their IMFs so that tax could be assessed against them. The second scheme, Blue Ridge Group, helped clients create common-law business trusts, into which he claimed that they could place any or all of their assets in order to avoid paying income tax. Affirming his conviction under 26 U.S.C. 7212(a) for corruptly endeavoring to obstruct the “due administration” of federal income tax laws, the Sixth Circuit rejected arguments that the district court reversibly erred in failing to instruct the jury that section 7212(a) required proof that he was aware of a pending IRS proceeding; that his conduct was constitutionally and statutorily protected; and that certain witness testimony was improperly introduced at trial because the witness opined about his state of mind. View "United States v. Miner" on Justia Law

Someone murdered Chappelear in February 1992. Sergeant Calhoun of the Hamburg Township police led the investigation. Newman became the primary suspect based. Ballistics showed that Newman’s gun was the murder weapon, which police found in a duffle bag that contained hairs similar to Newman’s. Masters said that he saw two young men with light brown hair drive by Chappelear’s home in a car much like Kulpa’s not long before the murder. Both Newman and his friend Kulpa had light brown hair. In Calhoun’s affidavit supporting his request for a warrant to arrest Newman, he presented this and other evidence. The judge found probable cause, and the police arrested Newman. A jury convicted Newman of murder. In 2008, the Sixth Circuit held that the evidence presented at trial did not suffice to prove his guilt beyond a reasonable doubt. As a free man, Newman filed a 42 U.S.C. 1983 malicious prosecution action against Calhoun, claiming that Calhoun’s affidavit purposefully distorted Masters’ statement. . The court rejected Calhoun’s motion for summary judgment based on qualified immunity. The Sixth Circuit reversed, stating that there was ample evidence of probable cause for Newman’s arrest and no evidence of deliberate or reckless misrepresentation by Calhoun. View "Newman v. Twp. of Hamburg" on Justia Law

Debtor had significant financial problems. Morris, Debtor's principal, formed ECM on January 1, 2010, had the Debtor grant him a security interest in its assets, and recorded the financing statement on January 5. On January 10, Morris executed a bill of sale transferring his security interest to ECM. On July 27, 2010, the Debtor, through Morris, voluntarily surrendered its assets to ECM. Before the bankruptcy, the creditors filed state court actions, alleging successor liability, fraudulent transfer, fraud, and breach of fiduciary duty. The Debtor filed a voluntary Chapter 7 petition in 2012. The Chapter 7 Trustee filed an adversary proceeding to avoid fraudulent transfers. The Bankruptcy Court approved a settlement and dismissed “without prejudice.” The Trustee filed his Final Account and Distribution Report. The Debtor, as a corporation, did not receive a discharge. After the bankruptcy proceedings were completed, creditors reactivated their state court litigation. The Bankruptcy Court declined to enjoin the state proceedings. The Sixth Circuit Bankruptcy Appellate Panel affirmed. There is no reason the state court should not determine the preclusive effect of the Bankruptcy Court’s order, just as bankruptcy courts are regularly called upon to determine the preclusive effect of state court judgments in bankruptcy. View "In re: E.C. Morris Corp.." on Justia Law

Hoey, who owns a farmers’ market that offers hay rides, pony rides, and pumpkin picking, hired Armbruster to run the hay wagon for eight weekends. Armbruster is now a paraplegic because an accident with the wagon crushed her spine. She sued for negligence in Michigan state court. Armbruster and Hoey also sought a declaratory judgment, again in state court, that Armbruster was covered by Hoey’s General Commercial Liability insurance policy. The insurer, Western, sought a federal declaratory judgment that Armbruster was not covered by the insurance policy. The cases were consolidated in federal court. Counsel, provided by Western to Hoey, filed a workers’ compensation claim on the theory that Armbruster was an “employee” eligible for workers’ compensation. The state tort claim has been stayed until the workers’ compensation claim is resolved. The district court accepted jurisdiction and construed the policy to exclude Armbruster’s injury from coverage. The Sixth Circuit affirmed, agreeing that it would be helpful for the parties to know whether Western was liable for Hoey’s legal fees, that Western was not playing procedural games, and that the federal forum could resolve the action without interfering in Armbruster’s tort suit or taking on difficult questions of state law. View "W. World Ins. Co. v. Armbruster" on Justia Law