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https://www.courtlistener.com/api/rest/v3/opinions/8483317/ | If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
LEONI WELLNESS, LLC, UNPUBLISHED
November 10, 2022
Plaintiff-Appellant,
v No. 358818
Ionia Circuit Court
EASTON TOWNSHIP, LC No. 2021-034866-CZ
Defendant-Appellee.
Before: SAWYER, P.J., and MARKEY and SWARTZLE, JJ.
PER CURIAM.
Plaintiff applied, under defendant’s Ordinance 44, to be the sole business selling marijuana
within defendant’s boundary. BBSM, LLC, was the only other business that applied. Defendant’s
board unanimously scored BBSM as a more qualified candidate than plaintiff, and the board
awarded the sole license to sell marijuana within defendant’s boundary to BBSM. Plaintiff sued,
alleging that defendant’s award to BBSM was improper. The trial court granted defendant
summary disposition. We affirm.
I. BACKGROUND
Under the Michigan Regulation and Taxation of Marihuana Act, the “Marijuana Act,”
MCL 333.27951 et seq., no person may sell marijuana to the general public without first obtaining
a license to conduct business as a marijuana retailer. Municipalities retained the right to
“completely prohibit or limit the number” of marijuana establishments—including the number of
marijuana retailers—that could operate within its boundaries. See MCL 333.27956(1). If a
municipality elected to limit the number of marijuana establishments that may be licensed within
its boundaries, the municipality had the obligation to “decide among competing applications by a
competitive process intended to select applicants who are best suited to operate in compliance with
this act within the municipality.” MCL 333.27959(4).
Defendant’s Ordinance 44 limited the number of marijuana retailers within its boundary to
one, and it required defendant’s board to score three categories of information when deciding
between competing applications: the background of the applicant, human resources, and area
impact. The board could assign as many as 20 points to the first and last categories, and could
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assign up to 10 points for the human-resources category, for a total of 50 points. The “background
of the applicant” assessment included the applicant’s residency in the Township, in the county,
and in the state. The board then had to, “based on the resulting scores, select applicants who are
best suited to operate in compliance with the [Marijuana Act] in the Township.” If there was a tie,
the board had the discretion to “select the applicant who, based on the totality of the circumstances,
the Township [found was] best suited to operate in compliance with the [Marijuana Act.]”
Ordinance 44, § 4(e)(2).
Defendant’s board first held a meeting that indicated that plaintiff and BBSM had both
been scored 50 points on their applications, and it voted to approve BBSM’s application because
it was operated by locals who had been there for “40+ years.” After plaintiff argued that the
decision was improper, the board called a special meeting on April 20, 2021, in which it
unanimously rescinded the license it awarded to BBSM because only defendant’s board’s
supervisor had scored the applications.
Each member of the board then rescored the applicants, and the board determined that
BBSM had a higher score than plaintiff. Plaintiff’s score was reduced because it no longer met
the requirements for a medical-marijuana license and because its proposed building location had
“poor visibility for drivers.” The board then voted to authorize BBSM as the applicant with the
highest score.
Plaintiff brought suit against defendant, alleging that defendant’s Ordinance 44 violated
the Marijuana Act, the board violated the due process and equal protection clauses of the Michigan
Constitution, and that defendant violated the Open Meetings Act, MCL 15.261 et seq. The trial
court granted defendant summary disposition under MCR 2.116 (C)(4), (7), and (8).
Plaintiff now appeals.
II. ANALYSIS
“We review de novo a trial court’s decision to grant or deny a motion for summary
disposition.” Sherman v City of St Joseph, 332 Mich App 626, 632; 957 NW2d 838 (2020)
(citations omitted). This Court also reviews de novo questions regarding jurisdiction raised under
MCR 2.116(C)(4). Meisner Law Group, PC v Weston Downs Condo Ass’n, 321 Mich App 702,
713-714; 909 NW2d 890 (2017). “Summary disposition for lack of jurisdiction under MCR
2.116(C)(4) is proper when a plaintiff has failed to exhaust its administrative remedies.” Braun v
Ann Arbor Charter Twp, 262 Mich App 154, 157; 683 NW2d 755 (2004).
In reviewing a trial court’s decision under MCR 2.116(C)(7), we consider the record
evidence to determine whether the defendant is entitled to immunity. Poppen v Tovey, 256 Mich
App 351, 353-354; 664 NW2d 269 (2003). In contrast, “[a] motion for summary disposition under
MCR 2.116(C)(8) tests the legal sufficiency of a claim by the pleadings alone.” Smith v Stolberg,
231 Mich App 256, 258; 586 NW2d 103 (1998) (citation omitted).
Finally, if matters are considered outside of the pleadings, a court may review a challenge
to the merits under MCR 2.116(C)(10). When deciding a motion for summary disposition under
MCR 2.116(C)(10), we consider the evidence submitted in a light most favorable to the nonmoving
party. Payne v Payne, 338 Mich App 265, 274; 979 NW2d 706 (2021). “Summary disposition is
-2-
appropriate if there is no genuine issue regarding any material fact and the moving party is entitled
to judgment as a matter of law.” Sherman, 332 Mich App at 632.
A. PREEMPTION AND CONFLICT
Plaintiff first argues that the trial court erred when it granted defendant’s motion to dismiss
plaintiff’s claim that Ordinance 44 was preempted by, or otherwise in conflict with, the Marijuana
Act.
Municipalities may regulate matters of local concern unless state law preempts local
regulation expressly or by implication. See DeRuiter v Byron Twp, 505 Mich 130, 140; 949 NW2d
91 (2020). The state impliedly preempts local regulation when it has occupied the entire field of
regulation in a certain area. Id. The state directly preempts local regulation when an ordinance
prohibits what the state law allows or allows what the state law prohibits. Id.
Because the electorate adopted the Marijuana Act with provisions that specifically allow
municipalities to adopt regulatory ordinances and take actions consistent with the Marijuana Act,
this Court cannot conclude that the Marijuana Act occupied the entire field of regulation. See
Gmoser’s Septic Serv, LLC v East Bay Charter Twp, 299 Mich App 504, 515; 831 NW2d 881
(2013) (“[W]hen the Legislature unambiguously states its intent to permit local regulations within
certain parameters, we must enforce that intent.”).
Furthermore, Ordinance 44 does not conflict with the Marijuana Act. MCL 333.27959(4)
requires municipalities to establish a competitive process to determine between competing
applications. Ordinance 44 provides that if there are more applications for a given establishment
type than are permitted under the ordinance, then the Township is required to “decide among
competing applications by a competitive process intended to select applicants who are best suited
to operate in compliance with the [Marijuana Act] in the Township” according to three different
categories of scoring criteria. Ordinance 44, § 4(e)(1). The Township must score the criteria and
“select [the] applicants who are best suited to operate in compliance with the [Marijuana Act] in
the Township” on the basis of the “resulting scores.” Ordinance 44, § 4(e)(2). “In the event of a
tie score, the Township Board shall select the applicant who, based on the totality of the
circumstances, the Township finds is best suited to operate in compliance with the [Marijuana
Act.]” Ordinance 44, § 4(e)(2).
Thus, Ordinance 44 requires that the board use a competitive process for selecting among
applicants with the objective that the candidate who is best suited to comply with the Marijuana
Act in the Township be selected. This is fully consistent with MCL 333.27959(4).
Plaintiff’s argument, that Ordinance 44 conflicts with the Marijuana Act because the
Marijuana Act does not specify how to resolve a tie, is misplaced. Ordinance 44 instructs that a
tie should be broken by the board by examining the totality of the circumstances and selecting the
applicant that the board believes is best suited to operate in compliance with the Marijuana Act.
Nothing in the Marijuana Act precludes a board from resolving a tie in this way. To the contrary,
the tie-breaking provision is consistent with the requirements stated under MCL 333.27959(4).
Notwithstanding that Ordinance 44 mirrors the language from MCL 333.27959(4), plaintiff
lastly suggests that Ordinance 44 conflicts with the statute because the ordinance does not
-3-
adequately state the relevant criteria and is not limited to criteria relevant to the requirements stated
in the Marijuana Act. That provision does not, however, impose substantive requirements on the
competitive process selected by a municipality for deciding which of competing applicants will be
authorized in the municipality.
Therefore, there is no conflict and the trial court did not err when it granted summary
disposition to defendant on this ground.
B. SUBJECT-MATTER JURISDICTION
Plaintiff next argues that the trial court erred when it dismissed plaintiff’s claims under
MCR 2.116(C)(4). The trial court found that it did not have subject-matter jurisdiction to consider
plaintiff’s claims regarding violations of due process and equal protection, declaratory relief for
defendant enacting Ordinance 44, and declaratory relief for inappropriately rescoring the
applications.
“[T]he circuit court is presumed to have subject-matter jurisdiction over a civil action
unless Michigan’s Constitution or a statute expressly prohibits it from exercising jurisdiction or
gives to another court exclusive jurisdiction over the subject matter of the suit.” Teran v Rittley,
313 Mich App 197, 206; 882 NW2d 181 (2015).
Whether the trial court properly dismissed plaintiff’s claim for declaratory relief depended
on the underlying theory supporting that claim. See Cary Investments, LLC v Mount Pleasant, ___
Mich App ___; ___ NW2d ___ (2022) (Docket Nos. 356707 and 357862), slip op at 4 (stating that
a claim for declaratory relief must be predicated on a viable legal theory). Plaintiff’s argument
that defendant’s board erroneously scored the criteria under Ordinance 44 on the basis of the
evidence before it was subject to an administrative appeal. See id.; see also Krohn v Saginaw, 175
Mich App 193; 437 NW2d 260 (1988). Plaintiff did not request an administrative appeal within
the required time limit, and, thus, the trial court correctly determined that it did not have
jurisdiction to consider that claim. See Carleton Sportsman’s Club v Exeter Twp, 217 Mich App
195, 200-201; 550 NW2d 867 (1996) (holding that, when a board’s decision does not include a
right or review by ordinance, the aggrieved party has a right to review in the circuit court under
Const 1963, art 6, § 28); MCR 7.104(A)(1) (stating that the time limit for an administrative appeal
is jurisdictional and providing that an appeal must be filed within 21 days after entry of the
decision).
Regarding plaintiff’s claim for declaratory relief on the grounds that defendant violated the
Marijuana Act by enacting Ordinance 44, the trial court did have subject-matter jurisdiction. As
discussed earlier, however, the trial court properly dismissed plaintiff’s claim that Ordinance 44
was preempted by the Marijuana Act. Thus, plaintiff’s claim for declaratory relief, premised on
the argument that Ordinance 44 was improperly enacted by defendant, is without merit because it
was not predicated on a viable legal theory. “A trial court’s ruling may be upheld on appeal where
the right result issued, albeit for the wrong reason.” Gleason v Dep’t of Transp, 256 Mich App, 1,
3; 662 NW2d 822 (2003)
The trial court also dismissed plaintiff’s claim that defendant’s decision was in violation
of due process and equal protection. As this Court discussed in Cary Investments, LLC, ___ Mich
-4-
App ___; slip op at 3, “when due-process claims simply raise issues relative to the decision of a
local body such as the selection committee and the procedures employed by such a committee in
reaching that decision, they do not establish separate causes of action, so they must be presented
as an appeal.” (cleaned up). “But an administrative body cannot rule on constitutional claims, so
plaintiff’s due-process claims that could not be raised before the selection committee may be
presented to the circuit court in the first instance.” Id. (cleaned up). “Therefore, to the extent that
plaintiff’s due-process claims do more than challenge the procedures employed by the selection
committee and its ultimate decision, we cannot uphold the trial court’s award of summary
disposition for defendant under MCR 2.116(C)(4).” Id. (cleaned up).
The same is true in this case. Plaintiff alleged constitutional violations of due-process and
equal protection. Defendant had no authority to rule on those violations, so those claims were not
subject to an administrative appeal. See id. Rather, those claims had to be brought as independent
claims in the circuit court. Therefore, the trial court erred in dismissing these claims under MCR
2.116(C)(4).
C. CONSTITUTIONAL CLAIMS
Even though the trial court erred in granting defendant summary disposition under MCR
2.116(C)(4) regarding plaintiff’s constitutional claims, the trial court nevertheless reached the
correct decision.
This Court recently explained that a party asserting a claim for a due-process violation must
identify a protected property interest in order to sustain its claim:
The touchstone of due process involves the protection of the individual
against arbitrary government action. Due process includes both a substantive
component and a procedural component; the substantive component protects
against the arbitrary exercise of governmental power, whereas the procedural
component is fittingly aimed at ensuring constitutionally sufficient procedures for
the protection of life, liberty, and property interests. The initial inquiry for both
components is to identify the interest allegedly infringed to determine whether it
falls within the definition of life, liberty, or property. If the interest at issue does
not involve a life, liberty, or property interest, then the Due Process Clause affords
no protection and the claim must fail. [Pinebrook Warren, LLC v City of Warren,
___ Mich App ___, ___; ___ NW2d ___ (2022) (Docket Nos. 355989, 355994,
355995, 356005, 356011, 356017, 356023, 359269, and 359285), slip op at 10
(cleaned up).]
This Court further held that a first-time applicant for a license to operate a marijuana
establishment generally has no property interest in the application process that is protected by due
process. See id.; slip op at 10; Cary Investments, ___ Mich App at ___; slip op at 5. If a plaintiff
has not demonstrated that he or she has a property interest, this Court’s review is limited to
determining whether the government’s decision was arbitrary or capricious. See Pinebrook
Warren, ___ Mich App at ___; slip op at 10; Cary Investments, ___ Mich App at ___; slip op at 5.
Defendant’s decision to award the license to BBSM was not arbitrary or capricious because the
-5-
record showed that defendant’s board followed the procedures set out in the Marijuana Act and
Ordinance 44. See Pinebrook Warren, ___ Mich App at ___; slip op at 11.
Further, “[a]s this Court has noted, substantive due process does not protect persons from
every governmental action that infringes liberty or damages property.” Id.; slip op at 12 (cleaned
up). “Rather, the plaintiff must allege facts that—if true—would show that the actor used
governmental power to oppress or acted so irrationally that its conduct lacked any legitimate state
interest; the key consideration is that the conduct shocks the conscience.” Id. “Picking winners
and losers, although it might seem unfair, does not amount to irrational conduct or oppression; and
does not shock the conscience.” Id. Consequently, the trial court did not err when it dismissed
plaintiff’s due-process claims for failure to state a claim upon which relief could be granted. See
id. at ___; slip op at 11-13.
The trial court also did not err when it dismissed plaintiff’s claim regarding equal
protection. Plaintiff argued that defendant’s decision was premised on plaintiff’s residency as
compared to BBSM’s residency. Our Supreme Court has held that a municipality violates equal
protection when it prefers residents over nonresidents, and the distinction does not rest on any
reasonable basis, but is essentially arbitrary. See Cook Coffee Co v Flushing, 267 Mich 131, 134-
136; 255 NW 177 (1934).
Even though defendant’s board’s original determination was premised on the residency of
each applicant, when defendant’s board rescored both applicants it explicitly stated that it did not
consider residency as a factor. “Where the proponent of an equal protection argument is not a
member of a protected class, or does not allege violation of a fundamental right, the equal
protection claim is reviewed using the rational basis test.” Houdek v Centreville Twp, 276 Mich
App 568, 585-586; 741 NW2d 587 (2007). “Under rational-basis review, courts will uphold
legislation as long as that legislation is rationally related to a legitimate government purpose.”
Harvey v State, Dep't of Mgt and Budget, Bureau of Retirement Servs, 469 Mich 1, 7; 664 NW2d
767 (2003). “The party asserting an equal-protection violation must show that the policy is
arbitrary and wholly unrelated in a rational way to the objective of the policy.” Ass'n of Home
Help Care Agencies v Dep't of Health and Human Servs, 334 Mich App 674, 693; 965 NW2d 707
(2020) (cleaned up).
The other factors considered by defendant’s board, including plaintiff’s lapsed medical-
marijuana license and the proposed location for plaintiff’s proposed business, were rationally
related to the legitimate-government purpose of effectuating the Marijuana Act.
Additionally, plaintiff’s further contention that Ordinance 44 is unconstitutional because it
includes a required residency provision is without merit. Even when courts determine that a law
violates the Michigan Constitution, courts will give effect to the remaining portions of the law
whenever possible by severing the offending portion. See League of Women Voters of Mich v
Secretary of State, ___ Mich App ___, ___; ___ NW2d ___ (2021) (Docket Nos. 357984 and
357986); slip op at 17. In this case, defendant’s board preemptively took such action and, in effect,
severed the offending provision by giving both applicants the maximum possible score for
residency. The board’s decision to give no effect to the residency requirement removed any equal-
protection concern.
-6-
D. IMPROPER APPLICATION OF SUMMARY DISPOSITION
Lastly, plaintiff argues that the trial court erred when it considered the audio recording of
the meeting that defendant’s board held on April 20, 2021, because the audio recording did not
implicate the grounds that defendant asserted for dismissing any claims under MCR 2.116(C)(4)
or (C)(7), and the recording could not be considered when determining whether to dismiss under
MCR 2.116(C)(8). Plaintiff specifically argued that the trial court’s grant of summary disposition,
regarding its claim that defendant had violated the Open Meetings Act, was made under the wrong
subpart when considering defendant’s argument concerning the mootness of plaintiff’s claims.
“If summary disposition is granted under one subpart of the court rule when judgment is
appropriate under another subpart, the defect is not fatal.” Ellsworth v Highland Lakes Dev Assoc,
198 Mich App 55, 57; 498 NW2d 5 (1993). “The mislabeling of a motion does not preclude review
where the lower court record otherwise permits it.” Id. Our Supreme Court has stated that, when
a trial court considers information beyond the pleadings, appellate courts should treat the motion
as having been made under MCR 2.116(C)(10). See Innovation Ventures v Liquid Mfg, 499 Mich
491, 506-507; 885 NW2d 861 (2016).
Michigan courts generally do not decide “moot questions or declare legal principles that
can have no legal effect in the case.” Pinebrook Warren, LLC, ___ Mich App ___; slip op at 9.
“A decision is moot when an event has occurred that makes it impossible for the court to grant any
relief on the claim, or when judgment cannot have any practical legal effect on the existing
controversy.” Id.
Defendant’s board rescinded its April 6, 2021 decision, and it then held the April 20, 2021
meeting to rescore both applicants. This made moot each of plaintiff’s claims because plaintiff
premised its claims on misconduct that it alleged occurred at or before the meeting held on April
6, 2021. Additionally, under the Open Meetings Act, a public body has the right to reenact a
disputed decision and, if reenacted in conformity with Open Meetings Act, the reenacted decision
cannot be invalidated “by reason of a deficiency in the procedure used for its initial enactment.”
MCL 15.270(5).
Because the board rescinded the authorization that it made at the meeting held on April 6,
2021, the trial court could no longer consider any deficiency in the decision from the April 6, 2021
meeting when deciding whether the decision made on April 20, 2021, should be invalidated. See
MCL 15.270(5). Accordingly, plaintiff’s claim for any violation of the Open Meetings Act
premised on the board’s decision to authorize BBSM at the April 6, 2021, meeting was moot. See
Pinebrook Warren, ___ Mich App at ___; slip op at 9.
Lastly, plaintiff argues that it should have been provided with the opportunity to amend its
complaint to include allegations about the meeting held on April 20, 2021, or otherwise amend its
complaint in response to the grant of summary disposition. If a trial court grants a motion to
dismiss under MCR 2.116(C)(8), (9), or (10), the court must “give the parties an opportunity to
amend their pleadings as provided by MCR 2.118, unless the evidence then before the court shows
that amendment would not be justified.” MCR 2.116(I)(5).
-7-
The record showed that the board properly noticed its meeting of April 20, 2021, and held
the meeting open to the public in accord with the Open Meetings Act. It also conducted all of its
deliberations about the proper manner for proceeding and scoring of the applications on the open
record. Plaintiff asserts that it might find evidence that the board rescored the criteria with the
intent to lower plaintiff’s score, but it does not explain how that would negate the fact that the
board rescored the criteria in open debate at a properly noticed meeting that was held open to the
public. The record demonstrates that there was no basis on which plaintiff could allege that the
board violated the Open Meetings Act through its conduct of the meeting held on April 20, 2021.
Similarly, plaintiff is not entitled to amend its complaint because it has no property interest
in which to allege a violation of due process; the board effectively removed any potential equal-
protection violation; and Ordinance 44 does not conflict with the Marijuana Act that purposefully
and explicitly provides defendant the authority to enact Ordinance 44. Simply put, an amendment
of plaintiff’s current claims is not justified and the trial court did not err in not allowing plaintiff
the opportunity to amend its complaint.
III. CONCLUSION
Plaintiff has not identified any reversible error in the trial court’s decision to grant
defendant’s motion for summary disposition. Accordingly, we affirm.
Affirmed. As the prevailing party, defendant may tax its costs. MCR 7.219(A).
/s/ David H. Sawyer
/s/ Jane E. Markey
/s/ Brock A. Swartzle
-8- | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483342/ | If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
OLIVER BAKEMAN, FOR PUBLICATION
November 10, 2022
Plaintiff-Appellee,
v No. 357195
Macomb Circuit Court
CITIZENS INSURANCE COMPANY OF THE LC No. 2019-005246-NF
MIDWEST,
Defendant-Appellee,
and
CITIZENS INSURANCE COMPANY OF
AMERICA, HANOVER INSURANCE COMPANY,
and MICHIGAN AUTOMOBILE INSURANCE
PLACEMENT FACILITY,
Defendants.
Before: RONAYNE KRAUSE, P.J., and JANSEN and SWARTZLE, JJ.
JANSEN, J. (concurring)
I concur in the majority opinion, but write separately to address one point. Plaintiff first
testified that it was not his signature on the attendant care forms, and then testified that his signature
had been copied. If it is plaintiff’s contention that a forgery occurred, the burden is on him at the
summary disposition phase to make an offer of proof. If the party moving for summary disposition
under MCR 2.116(C)(10) meets its initial burden of supporting its position by affidavits,
depositions, admissions, or other documentary evidence, the burden shifts to the nonmoving party
to establish that a genuine issue of material fact exists. Quinto v Cross and Peters Co, 451 Mich
358, 362; 547 NW2d 314 (1996). The nonmoving party may not rely on mere allegations or
denials in pleadings to do so. Id. “If the opposing party fails to present documentary evidence
establishing the existence of a material factual dispute, the motion is properly granted.” Id. at 363.
As noted by the majority, plaintiff provided no evidence that his signature had been copied on the
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form. Contrary to plaintiff’s assertions, the burden to prove that such a forgery exists rests on him,
and not the insurance company. I therefore concur in the rest of the majority opinion.
/s/ Kathleen Jansen
-2- | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483341/ | If this opinion indicates that it is “FOR PUBLICATION,” it is subject to
revision until final publication in the Michigan Appeals Reports.
STATE OF MICHIGAN
COURT OF APPEALS
UNPUBLISHED
In re BLOCK/NYGAARD, Minors. November 10, 2022
No. 360449
Gogebic Circuit Court
Family Division
LC Nos. 2018-000069-NA
2019-000042-NA
Before: SAWYER, P.J., and MARKEY and SWARTZLE JJ.
SWARTZLE, J. (concurring).
I concur in the majority’s judgment as well as its analysis with the exception of Section
II.B. I do not quarrel with the majority’s application of current law; rather, my quarrel is with the
current law itself. For the reasons I set forth in my concurring opinion in People v King,
unpublished opinion per curiam of the Court of Appeals, issued October 15, 2020 (Docket No.
346559) (SWARTZLE, J., concurring), p 7, I do not believe that our Court should apply the plain-
error test to the waiver of counsel, either in the criminal context or this quasi-criminal context.
Our Supreme Court has granted leave to hear oral argument on the application for this issue, People
v King, 964 NW2d 34 (Mich, 2021), but, based on the law as it stands today, I must concur.
/s/ Brock A. Swartzle
-1- | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483346/ | In The
Court of Appeals
Ninth District of Texas at Beaumont
__________________
NO. 09-22-00169-CV
__________________
SUNOCO PARTNERS MARKETING AND TERMINALS, L.P., Appellant
V.
DISCUS ENGINEERED PRODUCTS, LLC, Appellee
__________________________________________________________________
On Appeal from the 136th District Court
Jefferson County, Texas
Trial Cause No. D-200,629
__________________________________________________________________
MEMORANDUM OPINION
Sunoco Partners Marketing and Terminals, L.P., Appellant, filed an
unopposed motion to dismiss this appeal. See Tex. R. App. P. 42.1(a)(1). Appellant
filed the motion before the appellate court issued a decision in the appeal. We grant
the motion and dismiss the appeal. See Tex. R. App. P. 43.2(f).
1
APPEAL DISMISSED.
PER CURIAM
Submitted on November 9, 2022
Opinion Delivered November 10, 2022
Before Golemon, C.J., Horton and Johnson, JJ.
2 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483348/ | In The
Court of Appeals
Ninth District of Texas at Beaumont
________________
NO. 09-21-00107-CR
NO. 09-21-00108-CR
________________
JORGE ARTURO MAR JR., Appellant
V.
THE STATE OF TEXAS, Appellee
________________________________________________________________________
On Appeal from the 359th District Court
Montgomery County, Texas
Trial Cause Nos. 18-10-13648-CR and 20-09-11180-CR
________________________________________________________________________
MEMORANDUM OPINION
A jury convicted Appellant of two counts of aggravated sexual assault and
made affirmative findings on the use of a deadly weapon. See Tex. Penal Code Ann.
§ 22.021(a)(1)(A). The trial court sentenced Appellant to concurrent terms of forty-
five years each in the Institutional Division of the Texas Department of Criminal
Justice.
1
On appeal, Appellant contends the trial court erred in permitting testimony of
other complainants. He further contends the trial court erred in failing to grant a
mistrial and in its wording of a protective order. Finding no reversible error, we
affirm the trial court’s judgments.
I. Background
Appellant and N. L.1 met through a social media platform called MeetMe.
N.L. used the social media platform to trade sex for drugs. N.L. testified they met in
person twice, with the first meeting in November of 2017, when they had a
consensual sexual encounter, and then the second meeting in August of 2018, when
Appellant allegedly committed the offenses in question. At trial, Appellant denied
the charges against him and argued that N.L. fabricated her allegations of aggravated
sexual assault in response to Appellant having paid for her services with counterfeit
currency. We summarize the testimony relevant to Appellant’s issues below.
A. N.L.’s Testimony
At the time of the alleged offense, N.L. and her boyfriend were living in a
motel in Spring. N.L. and Appellant communicated over social media and text
messaging and arranged to meet to smoke marijuana. Appellant picked up N.L. in
1
We refer to the victim and the civilian witnesses by their initials to conceal
their identities. See Tex. Const. art. I, § 30 (granting crime victims “the right to be
treated with fairness and with respect for the victim’s dignity and privacy throughout
the criminal justice process[.]”). See Smith v. State, No. 09-17-00081-CR, 2018 WL
1321410, at *1 n.1 (Tex. App.—Beaumont Mar. 14, 2018, no pet.).
2
his vehicle, which she described as a black Chevrolet Malibu with overly dark
window tinting. They drove for a while and talked. Eventually, Appellant drove to a
parking lot, and told N.L. he “wasn’t going to give [her] help for free and that [she]
would have to work for it[,]” meaning that he expected sexual services in exchange
for the drugs or money he promised to provide.
After N.L. declined Appellant’s request and attempted to persuade him to
drive her back to the motel, he asked for her phone so that he could install a
messaging application on it. Appellant then refused to return N.L.’s phone to her,
causing N.L. to panic and threaten to call the police. At that time, Appellant
threatened N.L. with a knife, telling her that if she failed to do what he said, he would
“shank [her] and leave [her] there and beat [her] and nobody would care. And that
he had done it before.” N.L. complied with Appellant’s demands out of fear for her
life and performed oral sex on him, and Appellant then forced N.L. to have sexual
intercourse with him.
Following the assaults, N.L. asked Appellant to return her phone to her and
she told him she would not call the police. In response, Appellant threw what N.L.
thought was her phone out of the car. N.L. believed Appellant had disposed of her
phone, not just its case, so she exited the car to retrieve it. Appellant then sped off
and N.L. ran back to her motel room and called the police. N.L. went to retrieve her
phone and found only the case to her phone.
3
Appellant cross-examined N.L. regarding the details of her trial testimony and
inconsistencies along with the lack of details in her earlier statements to law
enforcement authorities, as well as her statement she gave to the investigator hired
by the defense.
B. Detective William Cooke’s Testimony
Detective Cooke, an employee of the Houston Police Department,
authenticated State’s Exhibit 38, a vehicle registration form identifying Appellant’s
father as the registered owner of a black 2018 Chevrolet Malibu. Cooke described
the search of the vehicle in question, and testified that the search yielded a knife, a
condom, and Appellant’s wallet, as shown in the State’s exhibits.
Cooke testified that while he was investigating N.L.’s case, he identified other
victims Appellant had allegedly sexually assaulted, specifically, J.K. and P.H. Cooke
noted multiple similarities between the J.K., P.H. and N.L. assaults. In particular, he
stated that Appellant met all three women through the same social media platform
and threatened all of them with a knife when they declined sexual contact. In
addition, Appellant threw J.K.’s phone case out of the car window shortly before
leaving the scene of the assault.
Appellant cross-examined Cooke about the communications between
Appellant and his victims, paying particular attention to the references to exchanging
money and sex.
4
C. Deputy Leneka Winters’ Testimony
Deputy Winters, an employee of the Harris County Sheriff’s Office, described
her background and experience in law enforcement. At the time of trial, Winters was
assigned to the adult sex crimes section of the Harris County Sheriff’s Office, tasked
with investigating allegations of “sexual assault or anything sexual involving an
adult.” Winters investigated an alleged sexual assault against S.D., and Winter’s
testimony echoed much of Cooke’s testimony regarding the similarities between the
alleged assault on S.D. and the assault on N.L. Like Cooke, Winters noted the use
of social media as well as discussions of sex, drugs, and money and the use of a
counterfeit $100 bill. She also acknowledged that the social media application may
be used for prostitution.
D. Testimony of S.D.
S.D. testified that Appellant contacted her through social media, and the two
of them then communicated by way of text message. They agreed to meet in person,
and S.D. drove to the designated location to meet Appellant. S.D. joined Appellant
in his vehicle, and the two of them chatted for a while; eventually they broached the
subjects of money and sex. After S.D. told Appellant multiple times, she did not
want to exchange sex for money, Appellant “turn[ed] ugly,” and not only threatened
her with a knife, but told her he had a gun. Appellant then coerced S.D. into engaging
in both oral and vaginal sex. During the assault, Appellant also stole money S.D. had
5
hidden in her bra. They argued about the stolen money, and Appellant responded by
threatening to injure S.D. if she did not exit his car.
S.D. acknowledged that she did not initially report the sexual assault to the
police but only reported the robbery. She soon corrected her report and reported the
assault and went to a local hospital for a sexual assault examination. The 9-1-1 calls
made by S.D. were admitted into evidence and played for the Jury.
E. Testimony from J.K.
J.K. testified that she communicated with Appellant over social media and
cell phone text messaging. They discussed relaxing and watching a movie together,
so Appellant came to J.K.’s apartment. They then talked some more, and Appellant
offered J.K. money in exchange for sex. J.K. refused, so they instead considered
going to a fast-food restaurant and left J.K.’s apartment complex in Appellant’s car.
Eventually, Appellant drove to a parking lot, threatened J.K. with a knife and told
her to get into the back seat, where he sexually assaulted her. Following the assault,
Appellant drove J.K. to a gas station and ordered her out of his car but refused to
return her phone. Instead, he threw her phone case out of the car and sped away from
the scene. J.K. sought help from customers at the gas station, and they called the
police for her.
J.K. acknowledged sending Appellant a message that invited sexual
intercourse, but she testified that she “didn’t mean that [she] wanted to.”
6
F. Testimony of P.H.
Like other witnesses, P.H. met Appellant through a social media platform.
Although P.H. agreed to meet Appellant in person, she made it clear to him that she
was not agreeing to sexual intercourse. At first, their meeting went well; they talked,
and Appellant made P.H. “feel comfortable.” Eventually, they kissed, and she
performed consensual oral sex on Appellant. When Appellant became “a little
forceful with” P.H., she changed her mind about staying with him and told him she
needed to go home. Appellant then became aggressive. He removed P.H.’s shirt and
attempted to force vaginal sex on her. When P.H. resisted, Appellant threatened her
with a knife. Appellant made stabbing motions with the knife, struck P.H. on the
face with his hand, and called her a “stupid bitch.”
P.H. again requested Appellant to take her home, but Appellant instead
continued to beat P.H. and refused to return the phone he had taken from her. Despite
being barefoot and shirtless, P.H. then left Appellant’s car and flagged down a
passerby for help. When she reached her home, she woke her mother and called the
police.
G. Additional Testimony
The jury also heard evidence from Sergeant Joshua Hilado explaining the
procedure for conducting a photographic lineup. Pursuant to that procedure, N.L.
and P.H. selected a photograph of Appellant and identified him as their assailant.
7
And the jury also heard evidence from Detective William Cooke describing the
method of obtaining a search warrant for either a location or a suspect’s DNA. The
results of the DNA testing identified Appellant as the person whose DNA was found
on N.L.’s underwear and also found on the swabs collected during S.D.’s and J.K.’s
sexual assault examinations. Appellant stipulated to identity, meaning that he
acknowledged it was his DNA.
H. The Motion for Mistrial
During a break in the jury selection process, a bailiff escorted Appellant past
some of the jurors. The bailiff asked the jurors to move aside, and Appellant
contended that this event created the prejudicial impression he was in custody.
Appellant therefore moved for a mistrial.
Both the bailiff and a legal assistant testified regarding this event. The legal
assistant testified that Appellant was in street clothes at the time and was not
handcuffed, shackled, or restrained in any manner. The bailiff confirmed asking the
jurors to move but denied giving any indication Appellant was dangerous or in
custody. The trial court relied on this testimony, in addition to its own perception of
the situation, to deny Appellant’s motion for a mistrial.
II. Standard of Review
We review the trial court’s admission of evidence for an abuse of discretion.
See Martinez v. State, 327 S.W.3d 727, 736 (Tex. Crim. App. 2010); Layton v. State,
8
280 S.W.3d 235, 240 (Tex. Crim. App. 2009). A trial court abuses its discretion
when its decision lies outside the zone of reasonable disagreement. See Martinez,
327 S.W.3d at 736; Layton, 280 S.W.3d at 240. In addition, we uphold the ruling on
the admission of evidence if it was correct on any theory of law supported by the
record and applicable to the case, in light of what was before the trial court at the
time the ruling was made. See State v. Stevens, 235 S.W.3d 736, 740 (Tex. Crim.
App. 2007); Willover v. State, 70 S.W.3d 841, 845 (Tex. Crim. App. 2002); State v.
Ross, 32 S.W.3d 853, 856 (Tex. Crim. App. 2000); Weatherred v. State, 15 S.W.3d
540, 542 (Tex. Crim. App. 2000).
Appellant’s motion for mistrial also is reviewed under an abuse of discretion
standard. See Jenkins v. State, 493 S.W.3d 583, 612 (Tex. Crim. App. 2016). An
appellate court considers only those arguments before the court at the time of the
ruling. See Wead v. State, 129 S.W.3d 126, 129 (Tex. Crim. App. 2004). The ruling
must be upheld if it was within the zone of reasonable disagreement. Id.
III. Analysis
A. Extraneous Offense Evidence
Appellant contends that the trial court erred in admitting the testimony of J.K.,
P.H., and S.D., because this evidence was inadmissible propensity evidence. See
Tex. R. Evid. 404(b)(1). Appellant concedes that the evidence of these alleged
extraneous offenses would have been admissible to rebut a defense of consent, but
9
he contends that he did not base his defense on consent, but instead “cleverly
attacked the credibility of the State’s witnesses.” We disagree.
Appellant emphasizes his decision not to question N.L. about consent. Cross-
examination is not, however, the only way to raise a defensive issue. See Dabney v.
State, 492 S.W.3d 309, 318 (Tex. Crim. App. 2016). A defendant may raise
defensive issues such as consent and fabrication at other stages of the trial, including
jury selection and opening statement. Id.; see also Bass v. State, 270 S.W.3d 557,
563 (Tex. Crim. App. 2008) (discussing claims of fabrication or retaliation); Grant
v. State, 475 S.W.3d 409, 417-18 (Tex. App.—Houston [14th Dist.] 2015, pet. ref’d)
(discussing consent). Appellant raised consent during all three phases: voir dire,
opening statement, and cross-examination. By doing so, he made it clear that his
theory of the case was that N.L. consented but later fabricated her allegation of
aggravated sexual assault.
During the jury selection process, Appellant asked the jury panel whether “false
accusations happen[,]” and asked a particular panel member “[w]hat could be a
possible reason for a false accusation? Why would somebody falsely accuse
somebody?” Appellant’s questions elicited responses ranging from “revenge” to
“regret” and Appellant followed up on these responses. Appellant also questioned
the panel about consent. He specifically referenced non-verbal consent, as expressed
between people in a relationship. The defense attorney’s questions conveyed
10
Appellant’s intent to claim, as he claimed during his closing argument, that N.L.
consented on August 1, 2018 because she had consented previously.
Appellant again raised consent in his opening statement when he stated “[i]t’s
not about anything other than consent[,] . . . it was a consensual act[,]” and
referenced N.L.’s previous consensual contact with Appellant. During his cross-
examination of witnesses, Appellant continued to press the issue of consent.
Although Appellant did not directly question N.L. about consent, he did not need to
do so for consent to be a pervasive theme in his defense. Appellant asked a forensic
scientist whether the presence of Appellant’s DNA signified consent and asked a
deputy sheriff about prostitution in the vicinity of the motel. These questions implied
that N.L. was working as a prostitute, and that she consented to sex with Appellant.
Having determined that the challenged evidence was relevant to rebut
Appellant’s defensive theory of consent and fabrication, we next review whether the
trial court abused its discretion by overruling Appellant’s Rule 403 objections. See
Tex. R. Evid. 403; Perkins v. State, No. PD-0310-20, 2022 WL 4088529, at *5-6
(Tex. Crim. App. Sep. 7, 2022). Appellant argued that the State’s proposed evidence
of extraneous offenses would be not only confusing to the jury and unduly
prejudicial, but also it would needlessly prolong the trial. The trial court performed
a balancing test and overruled the objections. When we review a “trial court’s
balancing test determination,” we do not reverse the trial court's judgement lightly
11
and do so “‘rarely and only after a clear abuse of discretion.’” Id. (citing Mozon v.
State, 991 S.W.2d 841, 847 (Tex. Crim. App. 1999)). That said, we do not just end
our review by saying the trial court applied a balancing test. Instead, “the trial court's
ruling must be measured against the relevant criteria by which a Rule 403 decision
is made.” Id. We examine:
1. How compellingly the extraneous offense evidence serves to make
a fact of consequence more or less probable;
2. The potential of the evidence to impress the jury in some irrational,
but nevertheless indelible way;
3. The time the proponent needs to develop the evidence, during which
the jury will be distracted from consideration of the indicted offense;
and
4. The proponent’s need for the evidence.
Id. at *5.
The doctrine of chances is “the principle that evidence of the repetition of
similar unusual events over time demonstrate a decreasing probability that those
unusual events occurred by chance.” Martin v. State, 173 S.W.3d 463, 467 (Tex.
Crim. App. 2005). The evidence that Appellant committed three extraneous
aggravated sexual assaults makes it more probable that Appellant committed the
aggravated sexual assault charged in the instant case. This same principle is relevant
to the State’s need for the evidence of the extraneous offenses, for it “strengthened
the State’s case on the consent issue.” Marc v. State, 166 S.W.3d 767, 776 (Tex.
App.—Fort Worth 2005, pet. ref’d). As the State noted during the trial,
12
when the defense of consent is made in this situation like that, there’s
really no other way for the State to rebut that defensive theory other
than to say under the Doctrine of Chances. It is extremely hard to
believe – while something like that might be able to happen once, it’s
extremely hard to believe that it happened four times to the same
unfortunate defendant.
In short, the State needed the extraneous evidence because it made a fact of
consequence more probable. The first and fourth factors weigh in favor of
admissibility.
Although the challenged evidence did have the potential to impress the jury
with an impermissible inference of character conformity, the trial court addressed
any such inference by giving the jury a limiting instruction during the trial and in the
jury charge.2 This instruction unambiguously limited the jury’s consideration of the
extraneous offenses, and the jury is presumed to have followed the instruction. See
Thrift v. State, 176 S.W.3d 221, 224 (Tex. Crim. App. 2005) (holding that absent
contrary evidence, a jury is presumed to have followed a limiting instruction).
Accordingly, the second factor also favors admissibility.
2
The instruction read as follows:
You are further instructed that if there’s any evidence before you in this case
regarding the Defendant’s committing an alleged offense or offenses other than the
offense alleged against him in the Indictment in this case, you cannot consider such
evidence for any purpose unless you find and believe beyond a reasonable doubt that
the Defendant committed such other offense or offenses, if any, and even then, you
may only consider the same in determining the motive, intent, preparation, plan,
knowledge, or lack of consent, if any, in connection with the offense, if any, alleged
against [the defendant] in the Indictment and for no other purpose.
13
The trial court also considered the amount of time needed to present the
evidence of the extraneous offenses. The State streamlined its presentation,
eliminating several witnesses. Although the presentation of the State’s remaining
witnesses did prolong the trial, we do not find undue delay. This third factor also
favors admissibility.
After “measur[ing] the trial court's ruling against the relevant criteria by which
a Rule 403 decision is made[,]” we conclude that the trial court did not abuse its
discretion in admitting the evidence of the extraneous offenses. Perkins, 2022 WL
4088529, at *6. We overrule Appellant’s first point on appeal.
B. Presumption of Innocence
In his second appellate issue, Appellant posits that the trial court should have
granted his motion for mistrial because a deputy escorted him past potential jurors
and asked those jurors to move aside. Appellant contends that because other
individuals were not similarly escorted, this event damaged his presumption of
innocence and he therefore was entitled to a mistrial. Appellant does not, however,
refer us to any case authority supporting his argument. Instead, Appellant references
case law holding that it is improper to try a defendant in restraints or jail clothing,
14
and he argues that this authority applies to an unrestrained defendant in street
clothes. 3
We have found no authority supporting Appellant’s position on this issue. To
the contrary, in Banks v. State, our Court of Criminal Appeals rejected the identical
argument. 643 S.W.2d 129, 133 (Tex. Crim App. 1982). The Banks court held that
an unrestrained defendant, wearing street clothes, experienced no violation of his
presumption of innocence when he was escorted from the courtroom “flanked on
either side by a uniformed deputy sheriff.” Id.; see also Parra v. State, 743 S.W.2d
281, 286 (Tex. App.—San Antonio 1987, pet. ref’d). We overrule Appellant’s
second point of error.
C. Protective Order
In his final issue, Appellant contends that the trial court erred in maintaining
the confidentiality of N.L.’s location information, despite there being no motion to
do so. See Tex. Code Crim. Proc. Ann. art. 7B.005(b). Appellant is correct that
neither N.L. nor the State moved to keep this information confidential. Appellant
has not, however, explained how this alleged error harms him, and consequently he
has waived his complaint. See Tex. R. App. P. 38.1(i); Cardenas v. State, 30 S.W.3d
3
The undisputed evidence showed that Appellant was wearing street clothes
at the time of this event, and was not handcuffed, shackled, or otherwise restrained.
15
384, 393-94 (Tex. Crim. App. 2000) (noting that failing to address alleged harm
results in waiver due to inadequate briefing). We overrule his final issue.
IV. Conclusion
To summarize, we conclude that the trial court did not abuse its discretion in
admitting evidence of extraneous offenses or in denying Appellant’s motion for
mistrial. In addition, Appellant failed to show how the alleged protective orders
harmed him, and therefore we overrule his final issue. Having overruled all of his
issues, we affirm the trial court’s judgments.
AFFIRMED.
________________________________
CHARLES KREGER
Justice
Submitted on July 5, 2022
Opinion Delivered November 9, 2022
Do Not Publish
Before Golemon, C.J., Kreger and Johnson, JJ.
16 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483347/ | In The
Court of Appeals
Ninth District of Texas at Beaumont
________________
NO. 09-21-00278-CR
NO. 09-21-00279-CR
________________
KALEB JERREL MARSHALL, Appellant
V.
THE STATE OF TEXAS, Appellee
________________________________________________________________________
On Appeal from the Criminal District Court
Jefferson County, Texas
Trial Cause Nos. 16-25639 and 17-27612
________________________________________________________________________
MEMORANDUM OPINION
In a single appellate issue, Appellant Kaleb Jerrell Marshall1 appeals the trial
court’s imposition of duplicate court costs in violation of Article 102.073(a) of the
Texas Code of Criminal Procedure. Tex. Code Crim. Proc. Ann. art. 102.073(a). The
State concedes that the trial court erred in charging Appellant court costs in both
1
The record reflects that Appellant is also known as Jerrel Chamar Marshall,
Kaleb Jerrel-Chemar Marshall, Jerrel Kaleb Marshall, and “Kay Jay.”
1
cases, and requests us to reform the judgment accordingly. We therefore affirm the
judgment in trial cause number 17-27612, and we reform the trial court’s judgment
in trial cause number 16-25639, and affirm it as reformed.
I. Background
In the trial court, Appellant pleaded guilty to forgery and burglary of a
habitation and was placed on deferred adjudication for periods of five years and ten
years, respectively. When he violated multiple conditions of his probation, the State
filed motions to revoke. Appellant pleaded “true” to some of the allegations against
him, was found guilty, and sentenced to concurrent terms of incarceration. In each
case, the trial court assessed court costs of $373.
II. Standard of Review
Court costs are not part of the guilt or sentence of a criminal defendant, nor
must they be proven at trial; rather, they are “a nonpunitive recoupment of the costs
of judicial resources expended in connection with the trial of the case.” See
Armstrong v. State, 340 S.W.3d 759, 767 (Tex. Crim. App. 2011) (quoting Weir v.
State, 278 S.W.3d 364, 366–67 (Tex. Crim. App. 2009). As a result, we review the
assessment of court costs on appeal to determine whether there is a basis for the cost,
not to determine whether there was sufficient evidence offered at trial to prove each
cost, and traditional Jackson v. Virginia evidentiary-sufficiency principles do not
2
apply. Johnson v. State, 423 S.W.3d 385, 390 (Tex. Crim. App. 2014) (citing
Jackson v. Virginia, 443 U.S. 307 (1979)).
III. Analysis
The State has acknowledged that the trial court convicted Appellant and
revoked his community supervision “in a single criminal action” for both the forgery
and the burglary cases. Tex. Code Crim. Proc. Ann. art. 102.073(a). For that reason,
Appellant may be charged court costs in conjunction with only one offense. Id.
Because the Code of Criminal Procedure directs us to assess court costs “using the
highest category of offense that is possible based on the defendant’s convictions[,]”
and because forgery is a state jail felony2 and burglary of a habitation is a second-
degree felony, 3 it is proper to impose those costs in trial court cause number 17-
27612, Appellant’s burglary case, and to delete them in trial court cause number 16-
25639, his forgery case. Tex. Code Crim. Proc. Ann. art. 102.073(b); See Carrier v.
State, No. 09-19-00128-CR, 2019 WL 6139166, at *1 (Tex. App.—Beaumont Nov.
20, 2019, no pet.) (mem. op., not designated for publication). We therefore sustain
Appellant’s sole point of error.
2
Tex. Penal Code Ann. § 32.21(d).
3
Tex. Penal Code Ann. § 30.02(c)(2).
3
IV. Conclusion
We modify the trial court’s forgery judgment in cause number 16-25639 to
delete the imposition of court costs in the amount of $373, thus eliminating the costs
assessed in that case. We affirm the trial court’s judgment for burglary in cause
number 17-27612, and affirm the judgment in cause number 16-25639 as reformed.
AFFIRMED AS REFORMED.
________________________________
CHARLES KREGER
Justice
Submitted on September 22, 2022
Opinion Delivered November 9, 2022
Do Not Publish
Before Golemon, C.J., Kreger and Johnson, JJ.
4 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483345/ | In The
Court of Appeals
Ninth District of Texas at Beaumont
__________________
NO. 09-22-00207-CV
__________________
IN RE MOUNTAIN VALLEY INDEMNITY COMPANY
AND SHANE WADDELL
__________________________________________________________________
Original Proceeding
60th District Court of Jefferson County, Texas
Trial Cause No. B-204,896
__________________________________________________________________
MEMORANDUM OPINION
In a first-party property damage suit, the insured (James Warren Stutts or Real
Party in Interest) alleged his homeowner’s insurance company (Mountain Valley
Indemnity Company or Relator) and the outside claims adjuster utilized by the
insurance company to adjust the claim (Shane Waddell) improperly handled his
claim for water damage caused by a malfunctioning plumbing line that was
connected to a second-floor water heater in the insured’s home. After invoking the
appraisal provision for the dwelling and contents loss part of the claim and after
receiving a partial summary judgment from the trial court, Stutts’ remaining causes
1
of action include alleged improper claims handling and bad faith claims. Stutts
served Mountain Valley Indemnity Company with written discovery requesting
production of certain documents that it alleges are relevant to the alleged improper
claims handling. Mountain Valley objected to the production of twenty-six pages of
documents that include what Mountain Valley describes as claim notes and
communications between Mountain Valley’s in-house counsel and Waddell, and
Waddell’s supervisor. Mountain Valley alleged the documents are protected by the
attorney-client privilege and work-product doctrine and Stutts filed a Motion to
Compel. The trial court, after inspecting documents in camera, ordered Relators
Mountain Valley Indemnity Company and Shane Waddell to produce claim notes
and communications between Mountain Valley’s in-house counsel, Waddell, and
Waddell’s supervisor.
In their mandamus petition, Relators contend they lack an adequate remedy
by appeal for the trial court’s clear abuse of discretion when it ordered Relators to
produce documents protected from discovery by the attorney-client privilege and the
work-product privilege. We temporarily stayed the trial court’s order compelling
discovery and requested a response from Real Party in Interest James Warren Stutts.
See Tex. R. App. P. 52.10(b). After considering the parties’ arguments and
authorities and after reviewing the record, including the in camera documents, we
conditionally grant mandamus relief.
2
To be entitled to mandamus relief, a relator must show that the trial court
clearly abused its discretion and the relator lacks an adequate remedy by appeal. In
re Prudential Ins. Co. of Am., 148 S.W.3d 124, 135-36 (Tex. 2004) (orig.
proceeding). A trial court abuses its discretion when it acts without regard to guiding
rules or principles or when it acts in an arbitrary or unreasonable manner. In re
Garza, 544 S.W.3d 836, 840 (Tex. 2018) (orig. proceeding). Mandamus relief is
available when the trial court erroneously orders the disclosure of privileged
information because appeal does not provide an adequate remedy. See In re Christus
Santa Rosa Health Sys., 492 S.W.3d 276, 279 (Tex. 2016); In re E.I. DuPont de
Nemours & Co., 136 S.W.3d 218, 223 (Tex. 2004); Walker v. Packer, 827 S.W.2d
833, 843 (Tex. 1992) (orig. proceeding).
1. Work-Product Privilege
Work product comprises:
(1) material prepared or mental impressions developed in
anticipation of litigation or for trial by or for a party or a party’s
representatives, including the party’s attorneys, consultants, sureties,
indemnitors, insurers, employees, or agents; or
(2) a communication made in anticipation of litigation or for trial
between a party and the party’s representatives or among a party’s
representatives, including the party’s attorneys, consultants, sureties,
indemnitors, insurers, employees, or agents.
Tex. R. Civ. P. 192.5(a). Litigation is anticipated (1) whenever the circumstances
surrounding the investigation would indicate to a reasonable person that there is a
3
substantial chance of litigation, and (2) the party resisting discovery had a good faith
belief that there was a substantial chance that litigation would ensue and conducted
the investigation for the purpose of preparing for such litigation. National Tank Co.
v. Brotherton, 851 S.W.2d 193, 204 (Tex. 1993) (orig. proceeding). Core work
product containing the “mental impressions, opinions, conclusions, or legal
theories” of an attorney or an attorney’s representative is not discoverable. Tex. R.
Civ. P. 192.5(b)(1); In re Nat’l Lloyds Ins. Co., 532 S.W.3d 794, 804 (Tex. 2017)
(orig. proceeding). A trial court may order disclosure of noncore work product only
if the requesting party shows substantial need and undue hardship. Tex. R. Civ. P.
192.5(b)(2); Nat’l Lloyds, 532 S.W.3d at 804.
Relators argue they anticipated litigation on the date Mountain Valley issued
its May 31, 2018 coverage letter reserving rights under the policy and advising Stutts
that he was unjustifiably causing an increase in the Loss of Use expense of his claim.
They argue Stutts failed to produce any evidence establishing his substantial need
for the material to prepare his case and he failed to show that he is unable without
undue hardship to obtain the substantial equivalent of the material by other means.
They further argue that the in-house counsel’s emails include some core work
product.
Stutts argues Relators failed to produce evidence that the communications at
issue were made in anticipation of litigation as opposed to normal claims-handling;
4
therefore, he argues, the burden never shifted to him to produce evidence of a
substantial need.
When the claim for protection is based on a specific privilege, such as
attorney-client or attorney work product, the documents themselves may constitute
the only evidence substantiating the claim of privilege. Weisel Enters, Inc. v. Curry,
718 S.W.2d 56, 58 (Tex. 1986) (orig. proceeding). We have reviewed the in camera
documents and find that Mountain Valley met its burden of making a prima facie
showing that the documents are protected from discovery as under the work-product
doctrine. To the extent some of the documents may only be non-core work product,
Stutts has not shown a substantial need for the documents. So, we conclude the trial
court abused its discretion by ordering production of documents protected as
attorney work-product.
2. Attorney-Client Privilege
The attorney-client privilege protects communications between attorney and
client that are (1) not intended to be disclosed to third parties, and (2) made for the
purpose of facilitating the rendition of professional legal services. Nat’l Lloyds, 532
S.W.3d at 803. “The privilege promotes free discourse between attorney and client,
thereby advancing the effective administration of justice.” Id. A client has a privilege
to refuse to disclose and to prevent any other person from disclosing confidential
communications made to facilitate the rendition of professional legal services to the
5
client. Tex. R. Evid. 503(b)(1). The attorney-client privilege protects confidential
communications between a client or the client’s representative and the lawyer or the
lawyer’s representative and between the client’s representatives who, to facilitate
the rendition of professional legal services to the client, make or receive a
confidential communication while acting in the scope of employment for the client.
Id; see also Tex. R. Evid. 503(a)(2)(B).
Relators identify certain e-mail correspondence among Waddell, his
supervisor Mike Reyna, and Mountain Valley’s in-house counsel Ellen Greer. They
argue these e-mail communications clearly fall within the attorney-client privilege
because they “make clear that Ms. Greer’s involvement was for legal advice because
of significant concerns about Stutts’s claim and because Stutts had retained an
attorney to represent him in his claim.” Stutts contends Relators failed to
demonstrate that the trial court could have reached only one decision in making a
factual determination that none of the documents were made to facilitate the
rendition of legal services. Stutts argues the attorney-client privilege does not apply
to the extent any attorney’s communications related solely to the investigation and
evaluation of Stutts’s claim.
We reviewed the documents that Relators identified as being subject to the
attorney-client privilege and that the trial court reviewed in camera. These
documents show by the discussion and content thereof that they concern Mountain
6
Valley’s adjusters’ consultation with Mountain Valley’s staff attorney and pertain to
legal advice regarding Stutts’s claims. We conclude the trial court abused its
discretion by ordering production of the e-mail communication documents because
the documents are protected by the attorney-client privilege.
3. Appropriate Relief
“Mandamus is proper when the trial court erroneously orders the disclosure
of privileged information because the trial court’s error cannot be corrected on
appeal.” DuPont, 136 S.W.3d at 223. We lift our stay order and conditionally grant
mandamus relief. We are confident that the trial court will vacate its order of June
23, 2022. A writ of mandamus will issue only in the event the trial court fails to
comply.
PETITION CONDITIONALLY GRANTED.
PER CURIAM
Submitted on September 21, 2022
Opinion Delivered November 10, 2022
Before Golemon, C.J., Kreger and Johnson, JJ.
7 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483367/ | UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
VON MAURICE SUPER,
Plaintiff,
Civil Action No. 22-1274 (BAH)
v.
Chief Judge Beryl A. Howell
CONVERGENT OUTSOURCING, INC.,
Defendant.
MEMORANDUM OPINION
Proceeding pro se, plaintiff Von Maurice Super sued Convergent Outsourcing, Inc., a debt
collector, for actions they took to collect on an alleged debt that he owed to a third-party entity,
alleging violations of his “natural right to privacy,” violations of the Fair Credit Reporting Act
(“FCRA”), see generally 15 U.S.C. § 1681 et seq., the Fair Debt Collection Practices Act
(“FDCPA”), see generally 15 U.S.C. § 1692 et seq., and other federal statutes. After answering
plaintiff’s Amended Complaint, defendant moved for judgment on the pleadings, pursuant to
Federal Rule of Procedure 12(c). For the reasons outlined below, defendant’s motion is granted,
and the Amended Complaint is dismissed without prejudice.
I. BACKGROUND
Plaintiff filed his complaint in the Superior Court of the District of Columbia on March 23,
2022, alleging that defendant “committed aggravated identity theft” and “violated numerous
consumer rights, [and] [his] privacy.” Statement of Claim at 2, ECF No. 1–2. In the section
entitled “Request for Relief,” plaintiff listed the following: “[d]eletion of negative account[,]
[c]ease collection of debt[,] compensation for FCRA violations[,] & court cost.” Id. On the page
entitled “Notice,” plaintiff requested judgment in the amount of $9,000. Id. at 4. Defendant timely
removed the case to federal court on May 9, 2022. See Not. of Removal, ECF No. 1.
1
Plaintiff later filed his Amended Complaint, on August 29, 2022, in which he alleges that
defendant “furnish[ed] inaccurate and misleading information of an alleged debt to credit reporting
agencies . . . without permissible purpose and written consent from [him], and without providing
[him] the opportunity to opt out of reporting [his] personal financial matters to additional
unattended third parties.” Am. Compl. at 6, ECF No. 12. Specifically, defendant reported to
Experian and Equifax—two leading credit reporting agencies—that plaintiff “owed an amount of
$1,213.” Id. at 7. Plaintiff subsequently sent defendant “a cease-and-desist letter informing [it]
the alleged debt is in dispute and demanding defendant to cease any and all forms of
communication with [him] and all mediums.” Id. Despite his request, defendant “continued to
communicate with Experian and Equifax about the alleged debt . . . until July 2022,” purportedly
in violation of 15 U.S.C. § 1681n and an invasion of his privacy. Id. at 7–8. In his Amended
Complaint’s cover sheet, plaintiff notes that defendant has also violated 15 U.S.C. § 1692, 15
U.S.C. § 1028A, and 15 U.S.C. § 6803. Id. at 4.
After defendant’s communications with Experian and Equifax, plaintiff “filed a complaint
with the Consumer Finance Protection Bureau” requesting “proof of any documentation showing
probable evidence that [he] ha[s] obligation to the” account with defendant. Id. at 6–7. According
to plaintiff’s factual allegations set out in the Amended Complaint, defendant responded to his
complaint, explaining that on February 25, 2022, it “mailed [him] documents from Sprint,
validating the balance that [Sprint] state[s] is owed.” Id. at 7. 1 Defendant also explained that it
would “mail [plaintiff] another copy of the documents obtained from Sprint,” validating the
balance that they state is owed. Apparently, defendant mailed plaintiff the promised documents,
but plaintiff alleges that “[t]he document that was received was three billing statements, which
does not prove [his] indebtedness to [defendant] under” the account at issue. Id. Plaintiff further
1
Although plaintiff never explains who or what “Sprint” is, plaintiff’s discussion of Sprint in his Amended
Complaint suggests that it is the debt holder, while defendant is the debt collector. See Am. Compl. at 6–7.
2
alleges, in support, that “defendant has not provided any double entry bookkeeping accounting
ledger kept according to generally accepted accounting principles (GAAP)[,] [so] defendant can
no longer assume that their alleged debt is valid.” Id.
Plaintiff alleges other violations of the FDCPA in his Amended Complaint. First, he claims
that because “defendant has sent several document[s] claiming that [he] owe[s] a debt[,]”
defendant is in violation of 15 U.S.C. § 1692b(2). Id. Second, he says defendant engaged in
“willful negligence” and caused “emotional distress and financial harm by furnishing the alleged
debt on [his] credit file,” purportedly in violation of 15 U.S.C. § 1692j. Id. In his prayer for relief,
plaintiff seeks damages and various types of injunctive relief. Id.
As already noted, defendant answered the Amended Complaint, see Answer to Am.
Compl., ECF No. 21, and thereafter filed the pending motion for judgment on the pleadings,
pursuant to Rule 12(c), along with an accompanying memorandum of law in support. See Def.’s
Mot. for J. on Plead. (“Def.’s Mot.”), ECF No. 22; Def.’s Mem. In Supp. of Mot. for J. on Plead.
(“Def.’s Mem.”), ECF No. 22-1. The parties completed their briefing on November 9, 2022, see
Def.’s Me. In Further Supp. Def.’s Mot. For J. on Pleadings (“Def’s Reply”), ECF No. 24, so the
motion is now ripe for resolution.
II. LEGAL STANDARD
Rule 12(c) allows for judgment on the pleadings after responsive pleadings have been filed
but prior to trial. The standard for a motion for judgment under Rule 12(c) is essentially the same
standard as a motion to dismiss under Rule 12(b)(6). See Schuchart v. La Taberna Del Alabardero,
Inc., 365 F.3d 33, 35 (D.C.Cir. 2004); Haynesworth v. Miller, 820 F.2d 1245, 1254 (D.C. Cir.
1987), abrogated on other grounds by Hartman v. Moore, 547 U.S. 250 (2006); Baumann v.
District of Columbia, 744 F. Supp. 2d 216, 221 (D.D.C. 2010); Sanders v. District of Columbia,
601 F.Supp.2d 97, 99 (D.D.C.2009) (“The standard of review for motions for judgment on the
3
pleadings under Rule 12(c) of the Federal Rules is essentially the same as that for motions to
dismiss under Rule 12(b)(6).”). That is, the court must accept as true the non-movant’s “well-
pleaded allegations to the extent that ‘they plausibly give rise to an entitlement to relief.’” See,
e.g., McNamara v. Picken, 866 F. Supp. 2d 10, 14 (D.D.C. 2008) (quoting Ashcroft v. Iqbal, 556
U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)); Bowman v. District of Columbia, 562 F.
Supp. 2d 30, 32 (D.D.C. 2008). Legal conclusions, however, need not be accepted as true.
McNamara, 866 F. Supp. 2d at 14. “Because a Rule 12(c) motion would summarily extinguish
litigation at the threshold and foreclose the opportunity for discovery and factual presentation, the
Court must treat [the defendant’s] motion with the greatest of care and deny it if there are
allegations in the complaint which, if proved, would provide a basis for recovery.” Baumann, 744
F.Supp.2d at 221 (quotations omitted) (citing Haynesworth, 820 F.2d at 1254).
Although pro se complaints are liberally construed and “held ‘to less stringent standards
than formal pleadings drafted by lawyers,’” with entitlement “to all favorable inferences that may
be drawn from his or her allegations, a pro se complaint, like any other, must present a claim upon
which relief can be granted by the court.” Nicastro v. Clinton, 882 F. Supp. 1128, 1129 (D.D.C.
1995) (quoting Haines v. Kerner, 404 U.S. 519, 520 (1972)) (citation omitted), aff’d, 84 F.3d 1446
(D.C. Cir. 1996) (per curiam).
III. DISCUSSION
Liberally construed, the Amended Complaint is understood to make the following claims.
First, plaintiff says that defendant violated 18 U.S.C. § 1028A and 15 U.S.C. § 6803, presumably
in connection with his claim that defendant violated his “natural right to privacy.” Pl.’s Opp’n to
Def.’s Mot. for J. on the Pleadings (“Pl.’s Opp’n”) at 6–7, ECF No. 23. Second, plaintiff claims
that, when defendant reported plaintiff’s alleged debt to Experian and Equifax, it violated the
FCRA, which makes illegal several practices related to credit reporting of consumer accounts.
4
Am. Compl. at 6; Pl.’s Opp’n at 8–10. Finally, plaintiff alleges defendant violated the following
sections under the FDCPA: 15 U.S.C. § 1692b(2) for its communications with plaintiff; and 15
U.S.C. § 1692j for sending the debt to third parties, namely Experian and Equifax. Pl.’s Opp’n at
10–11; Am. Compl. at 7.
Defendant contends that plaintiff’s entire Amended Complaint should be dismissed. For
starters, it argues that 18 U.S.C. § 1028A and 15 U.S.C. § 6803 do not have private rights of action,
so plaintiff cannot raise claims under either of these laws. Def.’s Mem. at 4. With respect to
plaintiff’s FCRA claim, defendant says that (1) plaintiff never alleges that defendant willfully or
negligently pulled his credit report, so he cannot state a claim under § 1681n(a); and (2) defendant
had no duty to verify plaintiff’s debt prior to reporting the debt to the credit agencies and, in any
event, the FCRA lacks a private cause of action to enforce this provision. Id. at 4–5. Finally,
defendant argues that plaintiff’s FDCPA claims fail because (1) defendant did not contact a person
other than plaintiff in connection with collecting his debt and thus could not have violated
§ 1692b(2); and (2) a § 1692j violation could not have occurred here because the defendant is not
the creditor. 2 Id. at 6–7. For the reasons outlined below, defendant is right on all counts.
A. Plaintiff’s Claims Under § 1028A and § 6803.
First things first—plaintiff cannot state a claim under section 1028A and section 6803
because he has not demonstrated that either statute has a private right of action. Section 1028A is
the federal criminal statute penalizing aggravated identity theft. See 18 U.S.C. § 1028A(a)(1)
(“Whoever, during and in relation to any felony violation enumerated in subsection (c), knowingly
2
In opposition, plaintiff also alleges that defendant is misrepresenting itself as Sprint to collect for itself a debt,
which is actually owed to Sprint, attaching a document of what purports to be an image of his “credit file” in support
and alleging that defendant violated section 1692e(14) in the process. The snippet of plaintiff’s credit file is, however,
new factual matter that was not included in the Amended Complaint, and nowhere in the Amended Complaint did
plaintiff allege a violation of section 1692e(14). Although plaintiff is proceeding pro se, he is still not allowed to
“amend [his] complaint[] through [a] brief[] in opposition to [a] motion[] to dismiss.” Woytowicz v. George
Washington Univ., 327 F. Supp. 3d 105, 119 n.4 (D.D.C. 2018); see also Coll. Sports Council v. GAO, 421 F. Supp.2d
59, 71 n. 16 (D.D.C.2006) (“[T]he Court does not, and cannot, consider claims first raised in the plaintiff's
opposition.”). Consequently, that argument is not considered.
5
transfers, possesses, or uses, without lawful authority, a means of identification of another person
shall, in addition to the punishment provided for such felony, be sentenced to a term of
imprisonment of 2 years.”). As a general matter, federal criminal statutes do not furnish private
plaintiffs with a private right of action and may only be enforced through a prosecution by the
United States. See Chrysler Corp. v. Brown, 441 U.S. 281, 316 (1979) (“[T]his Court has rarely
implied a private right of action under a criminal statute[.]”); Keyter v. Bush, No. 04–5324, 2005
WL 375623, at *1 (D.C. Cir. Feb 16, 2005) (per curiam) (affirming dismissal of claims “pursuant
to 18 U.S.C. §§ 4, 241, and 242, because, as criminal statutes, these statutes do not convey a private
right of action”), cert. denied, 546 U.S. 875 (2005); see also Rockefeller v. U.S. Ct. of App. Office
for Tenth Circuit Judges, 248 F. Supp. 2d 17, 23 (D.D.C. 2003) (dismissing claims brought
pursuant to 18 U.S.C. §§ 242, 371 “because, as criminal statutes, they do not convey a private right
of action”); Gasaway v. Obama, No. CIV.A. 10-1979, 2010 WL 4793602, at *1 (D.D.C. Nov. 18,
2010) (rejecting pro se plaintiff’s assertion that 18 U.S.C. §§ 241, 242—both criminal statutes—
furnish a right to private action).
By contrast, plaintiff’s section 6803 claim is predicated on a civil statute, see 15 U.S.C.
§ 6803(a) (explaining various disclosure requirements that “financial institution[s]” must follow
when “disclosing nonpublic personal information”), but that statute, too, does not specifically
confer a private right of action against a “financial institution” for failing to follow the
requirements outlined in section 6803(a). “Like substantive federal law itself, private rights of
action to enforce federal law must be created by Congress.” Alexander v. Sandoval, 532 U.S. 275,
286 (2001). Nowhere in opposition does plaintiff explain how section 6803 implicitly provides
private plaintiffs with a right of action. Instead, plaintiff “left that [question] open to the court’s
interpretation,” Pl.’s Opp’n at 6, but plaintiff bears the burden of presenting sufficient legal basis
to answer that question in his favor. See Johnson v. Cap. One Bank (USA) N.A., No. 22-CV-363
6
(DLF), 2022 WL 1091226, at *1 (D.D.C. Apr. 12, 2022) (holding that a pro se plaintiff failed to
state a claim under 15 U.S.C. § 6801–03 because he did “not identify applicable causes of action”
in that statute). Indeed, a sister statute of 15 U.S.C. § 6803, in 15 U.S.C. § 6805, entitled
“Enforcement,” provides that only governmental entitles may enforce that section. 15 U.S.C.
§ 6805(a) (“[T]his subchapter and the regulations prescribed thereunder shall be enforced by the
Bureau of Consumer Financial Protection, the Federal functional regulators, the State insurance
authorities, and the Federal Trade Commission with respect to financial institutions and other
persons subject to their jurisdiction under applicable law, as follows . . . .”). 3 Plaintiff is not one
of the enumerated entities authorized to enforce § 6803.
Accordingly, plaintiff cannot state a claim under either section 1028A or section 6803.
B. Plaintiff’s § 1681n Claim.
Next up is plaintiff’s § 1681n claim, which he cannot sustain either. For one thing, plaintiff
does not fall into the category of those who can bring a claim under the FCRA. The FCRA imposes
civil liability on any person who willfully or negligently fails to comply with any of the statute’s
requirements. See 15 U.S.C. § 1681n (creating civil liability for willful noncompliance with any
portion of the Act); id. § 1681o (creating civil liability for negligent noncompliance with any
portion of the Act). “The [FCRA], however, expressly excludes Section 1681s–2(a) from the
purview of Sections 1681n and 1681o, instead limiting enforcement of Subsection (a) exclusively
to the federal and state agencies and officials identified in Section 1681s.” Mazza v. Verizon
Washington DC, Inc., 852 F. Supp. 2d 28, 34 (D.D.C. 2012); see also Haynes v. Navy Fed. Cred.
Union, 825 F.Supp.2d 285, 294–95 (D.D.C. 2011). Even if plaintiff could sustain such a claim,
the FCRA, among other things, imposes civil liability only on those “who willfully or negligently
3
In opposition, plaintiff cites to various cases regarding the common law claim for invasion of privacy, see
Pl.’s Opp’n at 6–7, supposedly suggesting that he can sustain a claim under D.C. common law. Plaintiff’s argument
goes nowhere, however, because he does not explain the elements of such a common law claim, nor how, based on
the facts alleged in his Amended Complaint, how he can plead such a claim.
7
obtain[] a consumer credit report for a purpose that is not authorized” by the statute. Betz v.
Jefferson Cap. Sys., LLC, 68 F. Supp. 3d 130, 133 (D.D.C. 2014) (citing 15 U.S.C. 1681n(a)).
Plaintiff has not alleged any facts to suggest that defendant pulled his credit report, or that it acted
willfully or negligently for a purpose that the FCRA does not authorize. Plaintiff’s § 1681n claim
must be dismissed.
C. Plaintiff’s FDCPA Claims.
Like his FCRA claim, plaintiff’s FCPA claims under section 1692b(2) and section 1692j
cannot get past first base. For one thing, his section 1692b(2) claim fails because plaintiff does
not allege in his Amended Complaint that defendant communicated with “any person other than
the consumer for the purpose of acquiring location information about the consumer . . . [.]” See
15 U.S.C. § 1692b(2) (emphasis added). Plaintiff’s allegations focus on what the defendant
communicated with him, not what it communicated to anyone else, so his claim under that section
fails.
Plaintiff’s section 1692j claim also fails to satisfy the essential statutory prerequisites. That
section makes it unlawful to:
design, compile, and furnish any form knowing that such form would be used to
create the false belief in a consumer that a person other than the creditor of such
consumer is participating in the collection of or in an attempt to collect a debt
such consumer allegedly owes such creditor, when in fact such person is not so
participating.
15 U.S.C. § 1692j. Said differently, section 1692j makes it unlawful to deceive a debtor into
thinking that someone else other than the creditor was participating in collection of the debt. See
id.; see also Francheschi v. Mautner-Glick Corp., 22 F. Supp. 2d 250, 256 (S.D.N.Y. 1998)
(explaining that a plaintiff fails to state a claim under section 1692j when “the complaint itself
recognizes that [the debt collector] was participating in the collecting of the debt”). For example,
8
it proscribes a creditor from pretending to be a debt collector when attempting to collect a debt
from a debtor. See Francheschi, 22 F. Supp. 2d at 256.
Plaintiff has not shown that he received any form or document from defendant that would
“create the false belief” that defendant was pretending to be a debt collector. Indeed, his
allegations indicate that defendant is not the entity owed the debt but is instead the debt collector.
See Am. Compl. at 7 (indicating that defendant sent plaintiff “documents obtained from Sprint,
validating the balance that they state is owed”).
IV. CONCLUSION
For the above reasons, plaintiff’s Amended Complaint is dismissed without prejudice. An
order consistent with this Memorandum Opinion will be filed contemporaneously.
Date: November 11, 2022
__________________________
BERYL A. HOWELL
Chief Judge
9 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483350/ | In The
Court of Appeals
Ninth District of Texas at Beaumont
__________________
NO. 09-21-00331-CR
__________________
ANDREW MICHAEL NARVAEZ, Appellant
V.
THE STATE OF TEXAS, Appellee
________________________________________________________________
On Appeal from the County Court at Law No. 4
Montgomery County, Texas
Trial Cause No. 20-351742
__________________________________________________________________
MEMORANDUM OPINION
Appellant Andrew Michael Narvaez (Appellant or Narvaez) was charged by
an amended information with the misdemeanor offense of reckless driving. See Tex.
Transp. Code Ann. § 545.401. Appellant elected to appear pro se at trial despite
admonishments by the trial court, and the trial court appointed “standby counsel” for
Appellant to confer with if Appellant wanted counsel during trial. Appellant pleaded
“not guilty,” and a jury found him guilty as charged. The trial court sentenced
Appellant to thirty days of confinement and assessed a $200 fine. Narvaez appealed.
1
In one issue, Appellant argues that the trial court abused its discretion in
denying Appellant’s motion for a mistrial when an extraneous offense was
introduced before the jury during the guilt/innocence phase of the trial. 1 According
to Appellant’s brief, “Appellant did not object immediately to the 404(b) violation
probably because as a pro se defendant, he probably did not understand the import
of the offending testimony.” According to Appellant, as a pro se defendant, he “was
unsure of the correct manner in which to challenge the introduction of the
inadmissible extraneous conduct evidence[,]” and “then turned to ‘stand by’ counsel
to argue the point and ultimately make a motion for mistrial.” Appellant argues that
defense counsel proceeded to formally object to the admission under Texas Rules of
Evidence 401, 402, 403, and 404(b). Appellant concedes that the non-redacted
exhibit mistakenly played at trial was not admitted for appellate purposes and that
only a redacted exhibit was admitted and sent back to the jury. Finding no error, we
affirm.
Background and Testimony Related to the Stated Issue
The trial court granted that portion of the State’s motion in limine that required
the defense establish, outside the presence of the jury, the admissibility of any
1
According to Appellant’s brief, Appellant was originally charged with both
reckless driving and possession of marijuana (class B misdemeanor) and the
marijuana case was dismissed on the same day as his conviction for the reckless
driving. The information for the possession of marijuana charge and the dismissal of
that charge are not part of our appellate record.
2
evidence of “testimony regarding the marijuana found in the defendant’s vehicle or
regarding the defendant’s comments to others on the marijuana and paraphernalia in
his vehicle” before mentioning or introducing such evidence before the jury. Prior
to voir dire and outside the presence of potential jurors, the trial court asked the
parties if there was anything in the motion in limine that needed to be addressed
specific to voir dire, and the prosecutor responded:
Just any mention of marijuana since the State is not moving forward on
that charge. We would just ask the Court to admonish the defendant not
to mention any feelings on marijuana since that’s not relevant to this
case.
The State called Shannon Acosta, an investigator with the Montgomery
County District Attorney’s Office, to testify. During Acosta’s testimony, the State
introduced Exhibit 5, a recording of a call made by Narvaez from jail, and the exhibit
was admitted into evidence without objection. The reporter’s record shows that
during the recording which was played for the jury at one point in the call Narvaez
mentioned he had also been arrested for marijuana, and at that point the State
promptly stated:
(STATE’S EXHIBIT NO. 5 PLAYING)
[Prosecutor]: I am moving to strike that from the record.
THE COURT: Granted.
The State continued its direct examination of Acosta, and then the State rested its
case, the defense rested its case, and the trial court recessed the jury and began to
3
discuss the jury charge. Thereafter, the following exchange between Appellant’s
standby counsel, the trial court, the prosecutor, and Appellant then transpired:
[Appellant’s Standby Counsel]: Judge, the defendant has agreed to
allow me to present this motion for him. So I’ll - - and it’s in regards to
the phone calls from jail, made reference to being arrested for
marijuana. That is a pending case against the defendant.
But the first request would be to ask for a jury instruction to
disregard the statement. And even if the Court were to grant that, I
believe the - - that would not cure the error.
THE COURT: Which I did. I think you made a motion to strike and - -
[Prosecutor]: Yes, Your Honor.
[Appellant’s Standby Counsel]: And we would say that is not curative
of the issue, Judge. And we’d, first of all, object to the admission as
being irrelevant, more prejudicial than probative, and a violation of
Rule 404(b), Texas Rules of Evidence. And given the Court did sustain
the objection, we would submit to the Court that that does not cure the
error; and, therefore, we’d ask for a mistrial.
THE COURT: Okay. The - - the motion for mistrial is denied.
...
[Prosecutor]: What’s actually in evidence on the CD is a redacted jail
call. What I did was I accidentally played the wrong jail call from off
of my computer because I preloaded all media onto my computer
because, as the Court is aware, media takes forever to - - if it’s inserted
from a CD takes forever to load. So I did, by pure accident, play the
unredacted portion of the jail call, which is why I asked for a motion to
- - why I moved for the record to be stricken of that last portion.
But again, what is in actual evidence on the CD itself is a
redacted jail call.
THE COURT: So what goes back to the jury is the redacted jail call
without the - -
4
[Prosecution]: Yes. And we are happy to allow Mr. Narvaez to listen to
that to make sure it’s redacted.
THE COURT: All right. So the motion for mistrial is denied.
It’s the Court’s thought that we can - - . . . the charge could
include an extraneous offense charge which basically says if anything
has been presented to the jury that hasn’t been proved beyond a
reasonable doubt bears no weight if - - if both parties believe that that’s
appropriate. . . .
MR. NARVAEZ: I mean, I guess I’m kind of held up because we did
talk about this prior to coming in that we wouldn’t mention anything
about it. It was a huge ordeal and here we are.
THE COURT: I know. I think - - at this point, the motion for mistrial
is denied. I will include an extraneous offense [jury] charge that would
address that which basically tells the jury if there’s any evidence of any
other crimes being committed, unless the State proves it beyond a
reasonable doubt, you can’t consider it for any purpose.
MR. NARVAEZ: That’s fair.
Standard of Review
We review the trial court’s denial of a motion for mistrial for an abuse of
discretion, viewing the evidence in the light most favorable to the trial court’s ruling,
and considering only those arguments before the court at the time of the ruling. Ocon
v. State, 284 S.W.3d 880, 884 (Tex. Crim. App. 2009). We must uphold the ruling
if it was within the zone of reasonable disagreement. Id. A mistrial is the appropriate
remedy only when the objected-to events are so emotionally inflammatory that
curative instructions are not likely to prevent the jury from being unfairly prejudiced
5
against the defendant. See Young v. State, 137 S.W.3d 65, 71 (Tex. Crim. App.
2004).
A mistrial is required only in extreme circumstances where the prejudice is
incurable because it “is of such character as to suggest the impossibility of
withdrawing the impression produced on the minds of the jurors.” Ladd v. State, 3
S.W.3d 547, 567 (Tex. Crim. App. 1999); see also Ocon, 284 S.W.3d at 884.
Because a mistrial is an extreme remedy, “a mistrial should be granted ‘only when
residual prejudice remains’ after less drastic alternatives are explored.” Ocon, 284
S.W.3d at 884-85 (quoting Barnett v. State, 161 S.W.3d 128, 134 (Tex. Crim. App.
2005)).
To preserve an issue for appellate review, the defendant must make a timely
request, objection, or motion stating specific grounds for the ruling he desires the
trial judge to make and obtain a ruling on the objection. Tex. R. App. P. 33.1(a)(1);
Wilson v. State, 71 S.W.3d 346, 349 (Tex. Crim. App. 2002) (citing Broxton v. State,
909 S.W.2d 912, 918 (Tex. Crim. App. 1995)). The objection must be made at the
earliest possible opportunity, and “[a] motion for mistrial is timely only if it is made
as soon as the grounds for it become apparent.” Griggs v. State, 213 S.W.3d 923,
927 (Tex. Crim. App. 2007); see also King v. State, 953 S.W.2d 266, 268 (Tex. Crim.
App. 1997); Turner v. State, 805 S.W.2d 423, 431 (Tex. Crim. App. 1991).
6
Analysis
Once a defendant in a criminal proceeding elects to represent himself, he is
held to the same standards as an attorney. Johnson v. State, 760 S.W.2d 277, 279
(Tex. Crim. App. 1988); Borne v. State, 593 S.W.3d 404, 414 (Tex. App.—
Beaumont 2020, no pet.); McCray v. State, 861 S.W.2d 405, 408-09 (Tex. App.—
Dallas 1993, no pet.). Judges are not required to make objections or otherwise assist
in the defense of a pro se defendant. See McKaskle v. Wiggins, 465 U.S. 168, 184
(1984); McCray, 861 S.W.2d at 408. Accordingly, a pro se defendant must present
a timely and specific request, objection, or motion to preserve a complaint for
appellate review. See Tex. R. App. P. 33.1(a)(1); Boyd v. State, 811 S.W.2d 105, 113
(Tex. Crim. App. 1991). A party’s failure to object to the trial court’s action waives
any error on appeal. Boyd, 811 S.W.2d at 113.
We note that our appellate record does not include the complained-of
statement played at trial.2 Even assuming that the statement was related to the arrest
for marijuana as alluded to by Appellant’s standby counsel at the time he objected
and moved for mistrial, based on the record before us, we conclude that Appellant
failed to make a timely objection or motion for mistrial because Appellant did not
2
The appellant bears the burden to bring forward on appeal a sufficient record
to show the error committed by the trial court. See Christiansen v. Prezelski, 782
S.W.2d 842, 843 (Tex. 1990) (per curiam) (“The burden is on the appellant to see
that a sufficient record is presented to show error requiring reversal.”); Greenwood
v. State, 823 S.W.2d 660, 661 (Tex. Crim. App. 1992).
7
object at the earliest possible opportunity or make his motion for mistrial as soon as
the grounds for it became apparent, which would have been when the complained-
of statement in the recording was played at trial. See Griggs, 213 S.W.3d at 927;
King, 953 S.W.2d at 268; Turner, 805 S.W.2d at 431. Instead, Appellant waited until
after Acosta had finished testifying, after both sides had rested, and while the parties
were discussing the jury charge to object and make his motion for mistrial. Because
Appellant failed to make a timely objection or motion for mistrial, he waived the
alleged error. See Griggs, 213 S.W.3d at 927 (where the grounds for appellant’s
motion for mistrial first became apparent during a witness’s testimony but appellant
failed to move for mistrial until after the witness had concluded his testimony, the
motion was untimely and failed to preserve the complaint for appeal.). We overrule
Appellant’s issue and affirm the trial court’s judgment.
AFFIRMED.
_________________________
LEANNE JOHNSON
Justice
Submitted on October 19, 2022
Opinion Delivered November 9, 2022
Do Not Publish
Before Kreger, Horton & Johnson, JJ.
8 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483349/ | In The
Court of Appeals
Ninth District of Texas at Beaumont
__________________
NO. 09-22-00200-CR
__________________
DYLAN PAUL TICE, Appellant
V.
THE STATE OF TEXAS, Appellee
__________________________________________________________________
On Appeal from the 252nd District Court
Jefferson County, Texas
Trial Cause No. 20-34,902
__________________________________________________________________
MEMORANDUM OPINION
In an open plea, appellant Dylan Paul Tice pleaded guilty to the offense of
violation of a protective order with previous convictions, a third-degree felony. See
Tex. Penal Code Ann. § 25.07(g)(2). After conducting a sentencing hearing, the trial
court found Tice guilty of the offense of violation of a protective order with previous
convictions and assessed Tice’s punishment at six years of confinement.
Tice’s appellate counsel filed an Anders brief that presents counsel’s
professional evaluation of the record and concludes that the appeal is frivolous. See
1
Anders v. California, 386 U.S. 738 (1967); High v. State, 573 S.W.2d 807 (Tex.
Crim. App. 1978). On July 27, 2022, we granted an extension of time for Tice to file
a pro se brief. We received no response from Tice.
We have independently reviewed the appellate record, and we agree with
counsel’s conclusion that no arguable issues support the appeal. See Anders, 386
U.S. at 744. Therefore, we find it unnecessary to order appointment of new counsel
to re-brief the appeal. Cf. Stafford v. State, 813 S.W.2d 503, 511 (Tex. Crim. App.
1991). We affirm the trial court’s judgment.1
AFFIRMED.
_________________________
W. SCOTT GOLEMON
Chief Justice
Submitted on October 28, 2022
Opinion Delivered November 9, 2022
Do Not Publish
Before Golemon, C.J., Horton and Johnson, JJ.
1Tice may challenge our decision in this case by filing a petition for
discretionary review. See Tex. R. App. P. 68.
2 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483351/ | IN THE
TENTH COURT OF APPEALS
No. 10-22-00307-CV
IN RE GEORGE BERGIN
Original Proceeding
From the 414th District Court
McLennan County, Texas
Trial Court No. 2022-2156-5
MEMORANDUM OPINION
Relator George Bergin’s petition for writ of mandamus filed on September 21,
2022, is denied.
STEVE SMITH
Justice
Before Chief Justice Gray,
Justice Johnson,
and Justice Smith,
Petition denied
Opinion delivered and filed November 9, 2022
[OT06] | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483352/ | IN THE
TENTH COURT OF APPEALS
No. 10-20-00183-CV
JOSHUA DEVELOPMENT GP, LLC,
AS THE GENERAL PARTNER OF
JOSHUA DEVELOPMENT COMPANY, LTD.,
Appellants
v.
JOHNSON COUNTY SPECIAL UTILITY DISTRICT,
Appellee
From the 413th District Court
Johnson County, Texas
Trial Court No. DC-C201900699
MEMORANDUM OPINION
In four issues, appellant, Joshua Development GP, LLC, as the general partner of
Joshua Development Company, Ltd. (collectively “Joshua”), appeals the trial court’s
granting of a plea to the jurisdiction in favor of appellee, Johnson County Special Utility
District (“JCSUD”). We reverse and remand.
Background
The focus of this dispute is the Joshua Meadows Subdivision “Community
Facilities Contract” (the “Contract”) entered into in July 1999, by each party’s
predecessor-in-interest. The Contract included provisions where Joshua’s predecessor-
in-interest, Heritage Properties of Texas, LLC, agreed to construct a ground water storage
facility and pump station, sewer lift stations, force mains, water main, and all water and
sewer lines within the Subdivision, and pay $142,760 as full satisfaction of all impact fees
for the Subdivision. In return, JCSUD’s predecessor-in-interest, Johnson County
Freshwater Supply District No. 1 (“JSFWSD”), which later formally merged with JCSUD,
agreed to extend and connect an existing water main to a groundwater storage facility
and provide water and sewer service to the homes pursuant to its rates and policies. The
Contract also stated that title to this infrastructure would convey to JSFWSD upon
issuance of a Letter of Acceptance following final completion.
In November 1999, Heritage paid the $142,760 as prepayment for 332 water/sewer
taps and impact fees. The parties do not dispute whether the predecessors-in-interest
fulfilled the initial terms of the agreement.
In September 2004, Heritage sold its interests and assigned its rights and
obligations in the Joshua Meadows Subdivision to Joshua. In 2007, the JCSUD formally
merged with JCFWSD. From 1999 to 2007, no water or sewer impact fees were charged
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 2
by JCSUD or its predecessor-in-interest or paid by Joshua or its predecessor-in-interest
for approximately sixty-one homes constructed in Joshua Meadows.
Joshua alleges that JCSUD breached the Contract on June 20, 2019, when it sent a
letter to Joshua stating that it would no longer “provid[e] a ‘free ride’” to Joshua and that
the current utility fees would apply. JCSUD reasoned that the 1999 Heritage contract had
no language binding JCSUD.
At the time of JCSUD’s June 20, 2019 letter, approximately 150 of the original 332
lots remained undeveloped. Furthermore, from 1999 to 2019, the cost of water and sewer
connection fees increased from $430 per lot, as provided in the Contract and pre-paid by
Joshua, to $5,580 per lot. Joshua alleges that JCSUD’s actions will add approximately
$837,000 to Joshua’s remaining costs of development.
In September 2019, Joshua filed its original petition asserting, among other things,
that JCSUD breached the Contract by “wrongfully charging Plaintiff $5,580.00 per lot in
what should be pre-paid impact fees for each new home constructed.” JCSUD filed a
general denial, as well as a plea to the jurisdiction, arguing that it is entitled to
governmental immunity and that Joshua’s contract-based claims did not fall under any
provision that waives JCSUD’s governmental immunity. Joshua filed amended petitions
and multiple responses to JCSUD’s plea to the jurisdiction, asserting that JCUSD waived
governmental immunity under Chapter 271 of the Texas Local Government Code and
that JCSUD’s failure to accept Joshua’s pre-paid impact fees as full satisfaction of the
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 3
impact fees for new development in the subdivision constituted an inverse condemnation
and unconstitutional taking of Joshua’s property for which there is no governmental
immunity.
Both Joshua and JCSUD sought written discovery. Joshua responded, JCSUD did
not. Rather, JCSUD requested discovery extensions and filed a motion for protective
order and stay of discovery. The trial court did not set for a hearing or rule on JCSUD’s
motion for protective order or its stay of discovery. With the hearing on JCSUD’s plea to
the jurisdiction quickly approaching, Joshua filed a motion for continuance of the hearing
on the plea to the jurisdiction and a motion to compel JCSUD to respond to discovery
requests. Joshua’s motions for continuance and to compel were set for a hearing on the
same day as the plea to the jurisdiction.
On June 17, 2020, the trial court heard argument on all three pending matters—
JCSUD’s plea to the jurisdiction and Joshua’s motions for continuance and to compel. At
the conclusion of the hearing, the trial court took the case under advisement. Later, the
trial court signed an order granting JCSUD’s plea to the jurisdiction and dismissing
Joshua’s claims for want of jurisdiction.
Following the dismissal of its claims, Joshua requested that the trial court enter
findings of fact and conclusions of law. In a letter sent to the parties, the trial court
declined to enter findings of fact and conclusions of law because “the case was disposed
of pretrial and [on] jurisdictional grounds.” This accelerated appeal followed.
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 4
Plea to the Jurisdiction
In its first issue, Joshua contends that trial court erred by granting the JCSUD’s
plea to the jurisdiction because the JCSUD’s immunity is waived under section 271.152
of the Texas Local Government Code given that the Contract complies with section
271.151 of the Texas Local Government Code. See TEX. LOC. GOV’T CODE ANN. §§ 271.151-
.152.
STANDARD OF REVIEW
Governmental immunity has two components: immunity from liability and
immunity from suit. Tooke v. Mexia, 197 S.W.3d 325, 332 (Tex. 2006). A governmental
entity that enters into a contract waives its immunity from liability but retains its
immunity from suit unless its immunity from suit is specifically waived by the
Legislature. Id. Governmental immunity from suit implicates a trial court's subject
matter jurisdiction and is properly asserted in a plea to the jurisdiction. See Engelman
Irrigation Dist. v. Shields Brothers, Inc., 514 S.W.3d 746, 751 (Tex. 2017). We review the trial
court's ruling on a plea to the jurisdiction de novo. Houston Belt & Terminal Ry. Co. v. City
of Houston, 487 S.W.3d 154, 160 (Tex. 2016). Our ultimate inquiry is whether the particular
facts presented affirmatively demonstrate a claim within the trial court's subject-matter
jurisdiction. City of El Paso v. Heinrich, 284 S.W.3d 366, 378 (Tex. 2009).
Our analysis must begin with an evaluation of the plaintiff's pleadings. Tex. Dep't
of Parks & Wildlife v. Miranda, 133 S.W.3d 217, 226 (Tex. 2004). When examining the
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 5
pleadings, we construe them liberally in favor of conferring jurisdiction. Id. If the
pleadings do not contain sufficient facts to affirmatively demonstrate the trial court's
jurisdiction, but do not affirmatively demonstrate incurable defects in jurisdiction, the
issue is one of pleading sufficiency and the plaintiffs should be given the opportunity to
amend. Id. at 226-27. But if the pleadings affirmatively negate jurisdiction, then a plea to
the jurisdiction may be granted without allowing the plaintiffs an opportunity to amend.
Id. at 227.
DISCUSSION
Although Joshua argues that JCSUD’s immunity is waived under section 271.152
of the Texas Local Government Code, JCSUD counters that the Contract lacks an
“essential term”—the time of performance—and that any goods and services under the
Contract “flowed” away from JCSUD, the governmental entity. In other words, JCSUD
contends that the Contract does not meet the requirements for a “[c]ontract subject to this
subchapter” under section 271.151(2) of the Texas Local Government Code. See TEX. LOC.
GOV’T CODE ANN. § 271.151(2). We first address the complaint pertaining to the time of
performance.
Essential Terms of the Contract
Section 271.152 of the Texas Local Government Code waives qualifying
governmental entities’ immunity from suit for certain breach-of-contract claims. See id. §
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 6
271.152; see also City of Houston v. Williams, 353 S.W.3d 128, 134 (Tex. 2011). Specifically,
section 271.152 provides:
A local governmental entity that its authorized by statute or the constitution
to enter into a contract and that enters into a contract subject to this
subchapter waives sovereign immunity to suit for the purpose of
adjudicating a claim for breach of the contract, subject to the terms and
conditions of this subchapter.
TEX. LOC. GOV’T CODE ANN. § 271.152. This statute, when applicable, waives a
governmental entity’s immunity from suit for breach of contract by clear and
unambiguous language. See Williams, 353 S.W.3d at 134.
For immunity to be waived, three elements must be established: (1) the party
against whom the waiver is asserted must be a “local governmental entity,” as defined
by section 271.151(3); (2) the entity must be authorized by statute or the Constitution to
enter into contract; and (3) the entity must have, in fact, entered into a contract that is
“subject to this subchapter,” as defined by section 271.151(2). See TEX. LOC. GOV’T CODE
ANN. § 271.151(2)-(3); see also Williams, 353 S.W.3d at 134-35. It is undisputed that JCSUD
is a “local governmental entity,” as defined in section 271.151(3), and that JCSUD is
authorized to enter into contracts. See TEX. LOC. GOV’T CODE ANN. § 271.151(3). The only
question presented here is whether the Contract is the type of contract that, if breached,
waives JCSUD’s immunity.
The phrase “contract subject to this subchapter” means:
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 7
(A) A written contract stating the essential terms of the agreement for
providing goods or services to the local governmental entity that is
properly executed on behalf of the local governmental entity; or
(B) A written contract, including a right of first refusal, regarding the sale
or delivery of not less than 1,000 acre-feet of reclaimed water by the local
governmental entity intended for industrial use.
TEX. LOC. GOV’T CODE ANN. § 271.151(2)(A)-(B). Although section 271.151(2) of the Texas
Local Government Code does not define “essential terms,” the Texas Supreme Court has
held “essential terms” to include “the time of performance, the price to be paid, . . . [and]
the service to be rendered.” Williams, 353 S.W.3d at 138-39 (internal citations & quotations
omitted); see Kirby Lake Dev. Ltd. v. Clear Lake City Water Auth., 320 S.W.3d 829, 838 (Tex.
2010); Fort Worth Indep. Sch. Dist. v. City of Fort Worth, 22 S.W.3d 831, 846 (Tex. 2000)
(noting that a contract is legally binding "if its terms are sufficiently definite to enable a
court to understand the parties' obligations."); see also City of Pearsall v. Tobias, 533 S.W.3d
516, 523 (Tex. App.—San Antonio 2017, pet. denied). We rely on guiding principles of
contract interpretation to determine whether the services described in the contract are
sufficiently definite. Clear Creek Indep. Sch. Dist. v. Cotton Com. USA, Inc., 529 S.W.3d 569,
581 (Tex. App.—Houston [14th Dist.] 2017, pet. denied) (citing Fischer v. CTMI, L.L.C., 479
S.W.3d 231, 237 (Tex. 2016)).
While it is true that the Contract does not explicitly state the time of performance,
Joshua contends that the language of the Contract implies that it remains in effect until
all 332 houses in the subdivision are completed. JCSUD complains that this is an
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 8
unreasonable construction, especially considering the Contract was signed in 1999, and
by the time JCSUD sent the June 20, 2019 letter to Joshua, approximately 150 of the
original 332 lots remained undeveloped.
Regarding the absence of an explicit term for time of performance, one court noted
the following:
Courts have also been willing to supply missing terms when necessary to
effectuate the purposes of the parties under the agreement. The absence of
a duration term does not necessarily suggest that the parties did not enter
into an enforceable agreement; such incomplete agreements are often
enforced. When the duration of a contract is not expressly dictated by the
agreement, courts will frequently presume that the parties intended the
agreement to last for a reasonable time. This is especially true in cases
where the agreement contemplated that one party will make substantial
expenditures or other investments in accordance with performance.
Avila v. Gonzalez, 974 S.W.2d 237, 244-45 (Tex. App.—San Antonio 1998, pet. denied); see
Cytogenix, Inc. v. Waldroff, 213 S.W.3d 479, 486 (Tex. App.—Houston [1st Dist.] 2006, pet.
denied) (“If no time for performance is stated in the contract, the law may imply a
reasonable one if the contract is sufficiently definite for a court to be able to fix the time
when it can be enforced. . . . Thus, with some contracts, courts will examine the
surrounding circumstances to determine the parties’ intent as to the duration of the
contract, so long as a standard exists by which one can test performance.” (internal
citations & quotation marks omitted)).
In further support of supplying missing terms when necessary to effectuate the
purposes of the parties under the agreement, the Fourteenth Court of Appeals has stated:
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 9
“When parties have ‘already rendered some substantial performance or have taken other
material action in reliance upon their existing expressions of agreement,’ courts ‘will be
more ready to find that the apparently incomplete agreement was in fact complete.’”
Houston Cmty. College Sys. v. HV BTW, LP, 589 S.W.3d 204, 213 (Tex. App.—Houston [14th
Dist.] 2019, no pet.) (quoting Fischer, 479 S.W.3d at 237); see Cotton Com. USA, Inc., 529
S.W.3d at 583.
Here, the parties performed under the Contract for approximately twenty years.
Joshua made substantial expenditures by pre-paying $142,760 for all impact fees for all 332
houses to be completed in the Joshua Meadows subdivision, as well as constructing and
conveying to JCSUD title to a ground water storage facility and pump station, sewer lift
stations, force mains, water main, and all water and sewer lines within the subdivision.
Joshua also provided design and engineering services for the construction of the
infrastructure and paid a construction contractor to complete the infrastructure. In
return, JCSUD extended and connected an existing water main to a groundwater storage
facility and provided water and sewer service to the houses pursuant to its rates and
policies.
Despite the Contract’s lack of specificity as to duration, we conclude that the
Contract meets the “low threshold” of an agreement that states all essential terms and is
therefore enforceable. See Cotton Com. USA, Inc., 529 S.W.3d at 585 (noting that the school
district’s failure to challenge enforceability of the contract until after work was completed
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 10
indicated that the contract’s essential terms were sufficiently definite). The Contract
outlines the parties, the subject matter, and the basic obligations, such that a court could
understand the parties’ obligations. See id. (citing Fort Worth Indep. Sch. Dist., 22 S.W.3d
at 846); see also Lubbock County Water Control & Improvement Dist. v. Church & Akin, L.L.C.,
442 S.W.3d 297, 311 (Tex. 2014) (Willett, J., dissenting) (noting that the requirement of a
contract to be sufficiently definite to enable a court to understand the parties, subject
matter, and basic obligations is a “low threshold”); Cytogenix, Inc., 213 S.W.3d at 486;
Avila, 974 S.W.2d at 244-45. Accordingly, we hold that the Contract is subject to chapter
271 of the Texas Local Government Code.
The Flow of Goods and Services
Next, JCSUD contends that the Contract does not meet the section 271.151
definition of a contract because the Contract at issue does not pertain to goods and
services “flowing” to the governmental entity. Rather, JCSUD asserts that any goods and
services under the Contract “flowed away” from JCSUD.
“[G]oods and services” are not defined in Chapter 271. See M.E.N. Water Supply
Corp. v. City of Corsicana, 564 S.W.3d 474, 489 (Tex. App.—Waco 2018, pet. denied).
However, the Texas Supreme Court has stated that the terms are “broad enough to
encompass a wide array of activities,” and “includes generally any act performed for the
benefit of another.” Id. (citing Kirby Lake Dev., Ltd., 320 S.W.3d at 839). Moreover, the
goods and services provided “need not be the primary purpose of the agreement.” Id.
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 11
(citing Kirby Lake Dev., Ltd., 320 S.W.3d at 839). However, chapter 271’s waiver of
immunity does not extend to “‘contracts in which the benefit that the local governmental
entity would receive is an indirect, attenuated one.’” Kirby Lake Dev., Ltd., 320 S.W.3d at
839 (quoting Berkman v. City of Keene, 311 S.W.3d 523, 527 (Tex. App.—Waco 2009, pet.
denied) (op. on reh’g)); cf. Church & Akin, L.L.C., 442 S.W.3d at 303 (“When a party has no
right under the contract to receive services, the mere fact that it may receive services as a
result of the contract is insufficient to invoke chapter 271’s waiver of immunity.”).
As noted previously, the Contract required that Heritage, Joshua’s predecessor-in-
interest, construct a ground water storage facility and pump station, sewer lift stations,
force mains, water main, all water and sewer lines within the Subdivision, and pay
$142,760 as full satisfaction of all impact fees for the Subdivision. Joshua also provided
design and engineering services for the construction of the infrastructure and paid a
construction contractor to complete the infrastructure. In return, JCSUD’s predecessor-
in-interest, JSFWSD agreed to extend and connect an existing water main to the ground
water storage facility and provide water and sewer service to the homes pursuant to its
rates and policies. Furthermore, the Contract provided that, upon completion and final
walk-through by JCFWSD representatives, title to the infrastructure constructed by
Heritage conveyed to JCFWSD, which was then transferred to JCSUD. Given this, we
conclude that the Contract provided for “goods and services,” as contemplated in chapter
271 and by the Texas Supreme Court in Kirby Lake. See 210 S.W.3d at 839.
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 12
Moreover, in reviewing the Contract, it is apparent that the purpose of the
Contract was to construct the infrastructure necessary to connect homes in the Joshua
Meadows subdivision to the JCSUD’s system for the provision of water and sewer
service. It is also noteworthy that JCSUD admitted at oral argument, and the parties do
not dispute, that JCSUD is required to provide water and sewer service to the Joshua
Meadows subdivision. Thus, by acquiring title to the infrastructure constructed by
Heritage, JCSUD derived a direct, rather than an attenuated, benefit as a result of the
Contract that aids JCSUD in satisfying its legal requirement to provide water and sewer
service to the Joshua Meadows subdivision.1 See Kirby Lake Dev. Ltd., 320 S.W.3d at 832-
33, 838 (finding a waiver of immunity under section 271.152 where a water authority and
residential developers entered into contracts that required the developers to build water
and sewer facilities according to the water authority’s specifications and to lease the
facilities to the water authority free of charge until the water authority purchased them);
see also NBL 300 Grp. Ltd. v. Guadalupe-Blanco River Auth., 537 S.W.3d 529, 534 (Tex. App.—
San Antonio 2017, no pet.) (finding a waiver of immunity under section 271.152 where a
contract between the water authority and a residential developer required the developer
1 Interestingly, in its June 17, 2019 letter purportedly terminating the Contract, JCSUD claimed that
when it merged with JCFWSD, JCSUD did not assume any of the liabilities of JCFWSD. However, JCSUD
has not disclaimed any of the assets acquired from the merger with JCFSWD, including the infrastructure
constructed by Joshua under the Contract. In fact, the record reflects that JCSUD retains ownership of the
infrastructure construed by Joshua.
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 13
to construct a wastewater collection system in exchange for reimbursements to the
developer from the developer’s costs to construct the water-authority infrastructure by
adding $100 to each connection fee until the developer was fully reimbursed).
Despite the foregoing, JCSUD relies on two cases to support its position that no
goods or services “flowed” to JCSUD. See generally W. Travis County Pub. Util. Agency v.
Travis County Mun. Util Dist. No. 12, 537 S.W.3d 549 (Tex. App.—Austin 2017, pet.
denied); M.E.N. Water Supply Corp., 564 S.W.3d at 474. Both cases are distinguishable
from this case. In fact, both cases relied on by JCSUD primarily involve the supply of
water from one entity to another. See M.E.N. Water Supply Corp., 564 S.W.3d at 487-88; see
also W. Travis County Pub. Util. Agency, 537 S.W.3d at 551-52. Neither case involves a
developer paying for and constructing infrastructure to be conveyed to a governmental
entity. Moreover, it is noteworthy that the Third Court of Appeals specifically mentioned
that “the governmental entity must in the first instance have a right under the contract to
receive services—even under a broad interpretation of that term—because otherwise the
benefits incidentally accruing to it would be too ‘indirect’ and ‘attenuated’ to bring the
contract under the Act.” See W. Travis County Pub. Util Agency, 537 S.W.3d at 555 (citing
Church & Akin, LLC, 442 S.W.3d at 303; Kirby Lake, 320 S.W.3d at 839). As noted above,
JCSUD had the right to receive both goods—the infrastructure completed by Joshua—
and services—design and engineering services for the infrastructure and payment for a
construction contractor to complete the infrastructure—under the Contract. Therefore,
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 14
even applying the reasoning in West Travis County Public Utility Agency, we cannot
conclude that the benefits “flowed away” from JCSUD or that the benefits were indirect
or too attenuated as to not invoke chapter 271’s waiver of immunity. See id.
Specific Performance and Section 271.153 of the Texas Local Government Code
JCSUD also contends that it is immune from suits seeking actual damages other
than the amount “due and owed” by JCSUD under the Contract. See TEX. LOC. GOV’T
CODE ANN. § 271.153(a)-(b). JCSUD asserts that Joshua seeks specific performance in this
case—namely, “to prevent JCSUD from charging . . . the amount that the [impact] fees
increased after a 20[-]year delay in development, and to force JCSUD [to] pass that added
expense on to all of its rate payers.”
Section 271.153 of the Texas Local Government Code provides, in pertinent part:
(a) Except as provided by Subsection (c), the total amount of money
awarded in an adjudication brought against a local governmental entity
for breach of a contract subject to this subchapter is limited to the
following:
(1) the balance due and owed by the local governmental entity under
the contract as it may have been amended, including any amount
owed as compensation for the increased cost to perform the work as
a direct result of owner-caused delays or acceleration;
(2) the amount owed for change orders or additional work the
contractor is directed to perform by a local governmental entity in
connection with the contract;
(3) reasonable and necessary attorney’s fees that are equitable and just;
and
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 15
(4) interest as allowed by law, including interest as calculated under
Chapter 2251, Government Code.
(b) Damages awarded in an adjudication brought against a local
governmental entity arising under a contract subject to this subchapter
may not include:
(1) consequential damages, except as expressly allowed under
Subchapter (a)(1);
(2) exemplary damages; or
(3) damages for unabsorbed home office overhead.
Id. § 271.153(a)-(b).
In its live pleading, Joshua requested “[l]awful and allowable damages,”
reasonable and necessary attorney’s fees, and pre- and post-judgment interest with
respect to its breach-of-contract claim. Additionally, Joshua sought injunctive relief to
prevent JCSUD from “[c]harging Joshua any water or sewer impact fees or similar
charges for any lots in the Joshua Meadows subdivision in Joshua, Johnson County,
Texas” and “requiring any builder or owner of a lot in Joshua Meadows to pay water or
sewer impact fees as a requirement or condition precedent to obtaining water service
from Defendant [JCSUD].”
Joshua’s claim for damages for breach of contract comports with that which is
allowed under section 271.153(a). See id. § 271.153(a). Moreover, to the extent that
Joshua’s request for injunctive relief amounts to a request for specific performance, we
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 16
note the following language from the Texas Supreme Court in Hays Street Restoration
Group v. City of San Antonio:
Relying on our holding in Zachry that the Act does not waive immunity
from suit on a claim for damages not recoverable under Section 271.153, the
court of appeals reasoned that because the only remedy claimed by the
Restoration Group and awarded by the trial court was specific
performance, and Section 271.153 does not mention specific performance,
the Act does not waive the City’s immunity from suit for the Restoration
Group’s claim.
But Section 271.153 limits damages, not remedies. Damages is
money. An award of damages is a legal remedy. Specific performance, by
contrast, is an equitable remedy that lies within the court’s discretion to
award whenever . . . damages would be inadequate or . . . could not be
established. Damages and specific performance are alternatives to one
another.
Zachry does not answer the question presented here: whether
Section 271.153 foreclosed the Restoration Group’s suit for specific
performance. We hold that it did not. This is evident from the statute’s
plain text. Section 271.153 limits the total amount of money awarded to
enumerated categories of damages. Subsection (b) clarifies that damages
awarded to a local governmental entity may not include certain additional
categories. Neither mentions any equitable remedy. To read former Section
271. 153 as impliedly prohibiting every suit seeking an equitable remedy
against a local governmental entity would too greatly restrict the general
waiver of immunity in Section 271.152.
Accordingly, we conclude that the Act waives the City’s immunity
from suit on the Restoration Group’s claim for specific performance.
570 S.W.3d 697, 707-08 (Tex. 2019) (internal citations & quotation marks omitted).
Similarly, we are not persuaded by JCSUD’s reliance on section 271.153 to support
its argument that Joshua’s alleged request for specific performance prohibits the general
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 17
waiver of immunity in section 271.152. See id. at 707-08. Therefore, based on the
foregoing, we conclude that Chapter 271 waives JCSUD’s immunity from suit on Joshua’s
breach-of-contract claim. We sustain Joshua’s first issue.
Conclusion
Having sustained Joshua’s first issue, we need not address Joshua’s remaining
issues. See TEX. R. APP. P. 47.1, 47.4. We reverse the judgment of the trial court and
remand for proceedings consistent with this opinion.
STEVE SMITH
Justice
Before Chief Justice Gray,
Justice Smith,
and Justice Rose2
Reversed and remanded
Opinion delivered and filed November 9, 2022
[CV06]
2The Honorable Jeff Rose, Former Chief Justice of the Third Court of Appeals, sitting by assignment
of the Chief Justice of the Texas Supreme Court. See TEX. GOV'T CODE ANN. §§ 74.003, 75.002, 75.003.
Joshua Dev. GP, LLC, as the Gen. Partner of Joshua Dev. Co., Ltd. v. Johnson County Special Util. Dist.
Page 18 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483356/ | IN THE SUPREME COURT OF THE STATE OF NEVADA
BOBBIE PRICE; SUZANNE LOVELY; No. 85198
AND BRADLEY BAILEY,
Appellants, 2
so FILED
LOREN YOUNGMAN, AN .
INDIVIDUAL: EMMANUEL NOV 10 2022
BARRIENTOS: AND BELEM CAZARES,
Respondents. B
ASBE A. BRICANN
FS EME COURT
ORDER DISMISSING APPEAL
This is a pro se appeal from a district court order granting a
motion for summary judgment in an action relating to real property. Eighth
Judicial District Court, Clark County; Christy L. Craig, Judge.
Respondents Emmanuel Barrientos and Belem Cazares
(hereinafter Barrientos) have filed a motion to dismiss this appeal.
Barrientos asserts that the challenged order is not appealable under NRAP
3 because their claims against Wayne Grimes and Tri-State Collection &
Foreclosure Services, LLC, remain pending. It appears the challenged
order resolves the claims against Tri-State Collection & Foreclosure
Services where the order states that all interests of Tri-State Collection &
Foreclosure Services, LLC have been terminated as the result of the
foreclosure sale. However, it does not appear that the order resolves the
claims against Grimes. Accordingly, it does not appear that the order is
appealable as a final judgment under NRAP 3A(b)(1). See Lee v. GNLV
Corp., 116 Nev. 424, 426, 996 P.2d 416, 417 (2000) (“[A] final judgment is
one that disposes of all the issues presented in the case, and leaves nothing
for the future consideration of the court, except for post-judgment issues
Supreme Court
OF
NEVADA
ats Ae 22-3550F
such as attorney’s fees and costs.”). And no other statute or court rule
appears to authorize an appeal from the challenged order. See Brown v.
MHC Stagecoach, LLC, 129 Nev. 343, 345, 301 P.3d 850, 851 (2013) (this
court “may only consider appeals authorized by statute or court rule”).
Accordingly, this court lacks jurisdiction and
ORDERS this appeal DISMISSED.!
por. J.
Pickering
ee: Hon. Christy L. Craig, District Judge
Bobbie Price
Bradley Bailey
Suzanne Lovely
Loren Youngman
Law Offices of Michael F. Bohn, Ltd.
Eighth District Court Clerk
1Appellants may file a new notice of appeal once the district court
enters a final judgment resolving all claims asserted in the district court.
The Honorable Mark Gibbons, Senior Justice, participated in this
matter under a general order of assignment.
Supreme Court
OF
Nevapa 9
(0) 1N7A RS | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483374/ | Case: 21-20093 Document: 00516542432 Page: 1 Date Filed: 11/11/2022
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
November 11, 2022
No. 21-20093 Lyle W. Cayce
Clerk
Koch Project Solutions, L.L.C.,
Plaintiff—Appellant,
versus
Alliance Process Partners, L.L.C., doing business as
International Alliance Group; Triten Corporation,
Defendants—Appellees.
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 4:20-cv-3479
Before Richman, Chief Judge, and Clement and Duncan, Circuit
Judges.
Per Curiam:*
Koch Product Solutions, L.L.C. (KPS) appeals a stay order in its
federal declaratory judgment action. The district court granted the stay
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 21-20093 Document: 00516542432 Page: 2 Date Filed: 11/11/2022
No. 21-20093
largely because of a related pending state court action. Because the district
court did not abuse its discretion, we affirm.
I
KPS seeks a declaratory judgment that it has not unlawfully drawn
employees or business away from Triten Corporation and its subsidiary
International Alliance Group (together, Triten). KPS and Triten both
provide project management services to clients in the energy sector. KPS
leadership includes at least five former Triten employees, including KPS
President, Paul Switzer. While working at Triten, each of the employees
entered a contract that included noncompete provisions. The provisions
prohibited inducing or attempting to induce employees to leave Triten and
work for a competitor, and they prohibited soliciting or accepting similar
business from Triten clients for set periods. Between 2018 and 2019, all five
employees left their positions at Triten.
In June 2020, Switzer filed a lawsuit in Texas state court against
Triten for breach of contract and various state law torts. These claims arose
out of Triten’s alleged failure to pay Switzer compensation and benefits.
Triten responded with counterclaims against Switzer and third-party claims
against two of KPS’s parent companies, Koch Industries and Koch
Engineered Solutions, and against Koch officer David Dotson (collectively,
the Koch affiliates). Among other claims, Triten alleged civil conspiracy and
tortious interference with the noncompete provisions. Triten charged that
Switzer and the Koch affiliates sought to draw business away from Triten by
establishing KPS and recruiting the former Triten employees. Triten
referred to KPS in its claims, but it did not name KPS as a third-party
defendant. The state district court dismissed the Koch affiliates from the
2
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No. 21-20093
lawsuit for lack of personal jurisdiction, but that decision was reversed on
appeal.
In October 2020, KPS filed this federal declaratory judgment action
against Triten. KPS brought the lawsuit pursuant to the Declaratory
Judgment Act 1 “to remove the cloud over its name” cast by Triten’s
allegations in state court. The federal action consists of two counts of
tortious interference. First, KPS seeks a declaration that it did not interfere
with its employees’ contract obligations not to solicit or accept business from
Triten clients. Second, KPS seeks a declaration that it did not interfere with
its employees’ contract obligations not to induce or attempt to induce Triten
employees to leave Triten and work at a competitor.
Triten sought to dismiss or stay the suit under the Supreme Court’s
Brillhart 2 doctrine, whereby federal courts may exercise their discretion to
abstain from hearing declaratory judgment actions. 3 In January 2021, the
district court denied the motion to dismiss but granted a stay until final
judgment in the state court action. The district court reasoned that, although
the state court action involved additional claims and parties, “all of the
material questions necessary to decide the issues raised in this declaratory
judgment action are governed by state law and can be resolved in the state
court action,” since the lawsuit arose out of the same facts and involved the
same contractual issues. The district court ordered the parties to submit a
joint status report every 60 days until the stay is lifted. KPS timely appealed
the stay order.
1
28 U.S.C. § 2201-02.
2
Brillhart v. Excess Ins. Co. of Am., 316 U.S. 491 (1942).
3
Id. at 495.
3
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II
We must first determine our jurisdiction over this appeal. 4 KPS seeks
appellate review pursuant to 28 U.S.C. § 1291. Under § 1291, “federal
courts of appeals are empowered to review only ‘final decisions of the district
courts.’” 5 “[A] decision is ordinarily considered final and appealable under
§ 1291 only if it ‘ends the litigation on the merits and leaves nothing for the
court to do but execute the judgment.’” 6 Most stay orders are not
considered final because they do not end litigation; they postpone it. 7
In abstention and related contexts, however, the Supreme Court has
recognized an exception to this general rule. 8 The Court first identified this
exception in Idlewild Bon Voyage Liquor Corp. v. Epstein. 9 In Idlewild, a liquor
distributor brought a federal suit challenging the constitutionality of a state
statute. 10 The district court stayed the lawsuit under the Pullman 11 doctrine,
whereby federal courts abstain from deciding constitutional disputes when a
state court’s clarification of its law would render a constitutional ruling
unnecessary. 12 The Supreme Court held that the stay order was a final
4
United States v. Shkambi, 993 F.3d 388, 389 (5th Cir. 2021) (“We start, as always,
with jurisdiction.”).
5
Microsoft Corp. v. Baker, 137 S. Ct. 1702, 1707 (2017) (quoting 28 U.S.C. § 1291)).
6
Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 712 (1996) (quoting Catlin v. United
States, 324 U.S. 229, 233 (1945)).
7
Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 10 n.11 (1983);
Kershaw v. Shalala, 9 F.3d 11, 14 (5th Cir. 1993).
8
Moses H. Cone, 460 U.S. at 10 n.11.
9
370 U.S. 713 (1962).
10
Id. at 714.
11
R.R. Comm’n of Tex. v. Pullman Co., 312 U.S. 496 (1941).
12
Id. at 501-02.
4
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decision appealable under § 1291 but gave limited reasoning. 13 It said only
that “[t]he Court of Appeals properly rejected the argument that the order
of the District Court ‘was not final and hence unappealable under 28 U.S.C.
§§ 1291, 1292,’ pointing out that ‘[a]ppellant was effectively out of court.’” 14
Two decades later, in Moses H. Cone Memorial Hospital v. Mercury
Construction Corp., 15 the Court relied on Idlewild’s “effectively out of court”
exception and held once again that a stay order was appealable under § 1291. 16
Moses H. Cone involved a stay entered under the Colorado River 17 doctrine,
whereby federal courts may in certain exceptional circumstances abstain
from exercising jurisdiction when there are concurrent state court
proceedings. 18 Idlewild secured appellate jurisdiction over the stay order. 19
In Idlewild, the “district court stay pursuant to Pullman abstention is entered
with the expectation that the federal litigation will resume in the event that
the plaintiff does not obtain relief in state court on state-law grounds.” 20 By
contrast, in Moses H. Cone, “a stay . . . meant that there would be no further
litigation in the federal forum; the state court’s judgment on the issue would
13
Idlewild, 370 U.S. at 715 n.2.
14
Id. (quoting Idlewild Bon Voyage Liquor Corp. v. Rohan, 289 F.2d 426, 428 (2d Cir.
1961)).
15
460 U.S. 1 (1983).
16
Id. at 10.
17
Colo. River Water Conservation Dist. v. United States, 424 U.S. 800 (1976).
18
Id. at 817-19.
19
Moses H. Cone, 460 U.S. at 10.
20
Id.
5
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No. 21-20093
be res judicata.” 21 As a result, “the argument for finality of the District
Court’s order [was] even clearer.” 22
Moses H. Cone emphasized that the “effectively out of court”
exception was narrow. “Of course,” the Court explained, “Idlewild does not
disturb the usual rule that a stay is not ordinarily a final decision for purposes
of § 1291, since most stays do not put the plaintiff ‘effectively out of
court.’” 23 The exception was “limited to cases where (under Colorado River,
abstention, or a closely similar doctrine) the object of the stay is to require all
or an essential part of the federal suit to be litigated in a state forum.” 24
The Court ascertained the stay’s object based on its legal
consequences. It was not enough that a stay “have the practical effect of
allowing a state court to be the first to rule on a common issue.” 25 Rather,
the Court “h[e]ld only that a stay order is final when the sole purpose and
effect of the stay is precisely to surrender jurisdiction of a federal suit to a
state court.” 26
Since Moses H. Cone, the Court has continued to apply this
exception. 27 In Quackenbush v. Allstate Insurance Co., 28 the Court deemed an
abstention-based remand order appealable under § 1291 because of its
21
Id.
22
Id.
23
Id. at 10 n.11.
24
Id.
25
Id.
26
Id.
27
See Quackenbush v. Allstate Ins. Co., 517 U.S. 706, 712 (1996); Wilton v. Seven
Falls Co., 515 U.S. 277, 280-81 (1995).
28
517 U.S. 706 (1996).
6
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decisions in Moses H. Cone and Idlewild. 29 Based on those precedents, the
order was appealable as a final decision under § 1291 because it “put[] the
litigants in this case effectively out of court, and its effect [was] precisely to
surrender jurisdiction of a federal suit to a state court.” 30 The Court
acknowledged that “these standards do not reflect our oft-repeated
definition of finality.” 31 Nevertheless, the Court concluded that § 1291
appealability was “compelled by precedent.” 32
Precedent also compels § 1291 appealability in this case. Like stay
orders governed by Pullman and Colorado River, the stay order governed by
Brillhart here concerns the interplay of federal and state proceedings. 33 The
stay suspends the former in favor of the latter; its object is “precisely to
surrender jurisdiction of a federal suit to a state court.” 34 Litigation of the
federal suit will not resume, if at all, until final judgment in the state court
action. The district court’s stay puts the litigants in this case “effectively out
of court.” 35 Under these circumstances, the stay is a § 1291 final decision.
Generally, when this court has deemed Brillhart stay orders
appealable under § 1291, the stays have suspended federal proceedings until
the resolution of a state court lawsuit with res judicata effect. 36 In those cases,
29
Id. at 712.
30
Id. (citing Moses H. Cone, 460 U.S. at 10 n.11) (internal citations omitted).
31
Id. at 713.
32
Id.
33
See Brillhart v. Excess Ins. Co. of Am., 316 U.S. 491, 495 (1942).
34
Moses H. Cone, 460 U.S. at 10 n.11.
35
Id.
36
Granite State Ins. Co. v. Tandy Corp., 986 F.2d 94, 95 (5th Cir. 1992); see also Am.
Guarantee & Liab. Ins. Co. v. Anco Insulations, Inc., 408 F.3d 248, 250 (5th Cir. 2005); Ford
7
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No. 21-20093
the stays guaranteed that there would be no further litigation in the federal
forum. In this case, the potential for future litigation is less clear. State law
determines the preclusive effect of a state court judgment. 37 Under Texas
law, res judicata requires: “(1) a prior final judgment on the merits by a court
of competent jurisdiction; (2) identity of parties or those in privity with them;
and (3) a second action based on the same claims as were raised or could have
been raised in the first action.” 38 When this court has deemed Brillhart stays
appealable under § 1291, it has not engaged in a detailed res judicata analysis.
That is because res judicata has been self-evident: the parties have been
identical, and the claims in the state and federal court actions have
overlapped. 39
Not so here. A final judgment by the state court on the merits of the
tortious interference claims may well satisfy elements one and three, but the
parties are not identical, and privity is uncertain. This distinction is crucial
to the preclusion analysis. Given the fact-specific nature of privity, 40 which
Motor Credit Co. v. Lewis, 233 F.3d 575, 2000 WL 1468831, at *4 (5th Cir. 2000) (per
curiam) (unpublished).
37
In re 3 Star Properties, L.L.C., 6 F.4th 595, 604-05 (5th Cir. 2021).
38
Cox v. Nueces Cnty., 839 F.3d 418, 421 (5th Cir. 2016) (quoting Amstadt v. U.S.
Brass Corp., 919 S.W.2d 644, 652 (Tex. 1996)).
39
See Am. Guarantee, 408 F.3d at 250 (holding that a stay order was appealable
under § 1291 when the parties were the same and the state proceeding encompassed
common issues); Granite State, 986 F.2d at 95 (holding that a stay order was appealable
under § 1291 when the parties were the same and the issues would “undoubtedly be
litigated in the state court action”); Ford Motor, 2000 WL 1468831, at *4 (“Since the state
court proceeding will resolve the declaratory judgment action’s only issue, the order
granting the stay of proceeding is considered a final judgment for purposes of 28 U.S.C.
§ 1291.”).
40
EEOC v. Jefferson Dental Clinics, PA, 478 F.3d 690, 694 (5th Cir. 2007) (citing
and then quoting Getty Oil Co. v. Ins. Co. of N. Am., 845 S.W.2d 794, 800 (Tex. 1992))
8
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No. 21-20093
the parties have not briefed, we decline to rule on privity or to predict the res
judicata effect of an unresolved state court proceeding. 41
In any case, the possibility of future litigation does not preclude our
jurisdiction. Our circuit precedents also hold that a stay order that causes a
“protracted and indefinite” delay in federal court proceedings suffices to put
plaintiffs “effectively out of court.” 42 This logic derives from Idlewild, in
which, as noted, the Supreme Court asserted § 1291 jurisdiction over a stay
that was “entered with the expectation that the federal litigation will resume
in the event the plaintiff does not obtain relief in state court.” 43 In this case,
the stay order has already delayed proceedings for over eighteen months, and
there is no indication that delay will end. Even if federal litigation does
ultimately continue, our jurisdiction is secure.
Triten contends that the district court’s order is not final because the
order requires the parties to submit periodic status reports. This argument
lacks merit. Section 1291 finality “is to be given a practical rather than a
technical construction.” 44 An order is final when “there is no indication that
(“Texas courts have been clear that there is no categorical rule for privity; instead the
courts look to ‘the circumstances of each case.’”).
41
Cooper v. Harris, 137 S. Ct. 1455, 1470 n.4 (2017) (determining that there was “no
occasion to address” a fact-intensive issue “the parties have not briefed or argued”).
42
Hines v. D’Artois, 531 F.2d 726, 731 (5th Cir. 1976) (holding that a stay order that
would delay proceedings for at least eighteen months was a final decision under § 1291); see
also Occidental Chem. Corp. v. La. Pub. Serv. Comm’n, 810 F.3d 299, 306-08 (5th Cir. 2016)
(affirming that Hines remains good law and holding that a stay order that had already
delayed proceedings for nearly two years was a final decision under § 1291).
43
Moses H. Cone Mem’l Hosp. v. Mercury Constr. Corp., 460 U.S. 1, 10 (1983); see
also Occidental, 810 F.2d at 306-07; Hines, 531 F.2d at 730-31.
44
Microsoft Corp. v. Baker, 137 S. Ct. 1702, 1712 (2017) (quoting Eisen v. Carlisle &
Jacquelin, 417 U.S. 156, 171 (1974)).
9
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the district court intends to revisit its decision to stay the case.” 45 Here,
there is no such indication. The district court ordered that “this action
should be stayed pending final adjudication in the state court action.” A
mere request for updates on the parties’ progress does not evince any interest
in lifting the stay before the state court action concludes.
III
We now turn to the merits of the stay order. Under the Declaratory
Judgment Act, federal courts “may declare the rights and other legal
relations of any interested party seeking such declaration.” 46 They are not
compelled to do so, however. In declaratory judgment actions, “the normal
principle that federal courts should adjudicate claims within their jurisdiction
yields to considerations of practicality and wise judicial administration.” 47
The statute has long “been understood to confer on federal courts unique
and substantial discretion in deciding whether to declare the rights of
litigants.” 48
The Brillhart doctrine governs the district court’s discretion to stay a
declaratory judgment action. 49 Under Brillhart, a district court “should
ascertain whether the questions in controversy between the parties to the
45
Am. Guarantee & Liab. Ins. Co. v. Anco Insulations, Inc., 408 F.3d 248, 250 (5th
Cir. 2005) (citing Moses H. Cone, 460 U.S. at 12-13).
46
28 U.S.C. § 2201(a).
47
Wilton v. Seven Falls Co., 515 U.S. 277, 288 (1995).
48
Id. at 286.
49
Sherwin-Williams Co. v. Holmes Cnty., 343 F.3d 383, 389 (5th Cir. 2003).
Although commonly referred to as Brillhart “abstention,” the term is “not entirely
accurate.” Med. Assur. Co., Inc. v. Hellman, 610 F.3d 371, 378 (7th Cir. 2010).
“Abstention” normally refers to “judicially-created doctrines,” whereas the discretion to
stay or dismiss an action under the Declaratory Judgment Act comes from the statute itself.
Id.
10
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federal suit . . . can better be settled in the proceeding pending in the state
court.” 50
We review the district court’s decision to stay federal court
proceedings pending the outcome of a state court action for abuse of
discretion. 51 Although discretion “is broad, it is not unfettered.” 52 A district
court abuses its discretion “unless [it] addresses and balances the purposes
of the Declaratory Judgment Act and the factors relevant” to the Brillhart
doctrine. 53 In St. Paul Insurance Co. v. Trejo, 54 we identified seven
nonexclusive factors to guide a district court’s exercise of discretion in a
Brillhart stay:
(1) whether there is a pending state action in which all of the
matters in controversy may be fully litigated;
(2) whether the plaintiff filed suit in anticipation of a lawsuit
filed by the defendant;
(3) whether the plaintiff engaged in forum shopping in bringing
the suit;
(4) whether possible inequities in allowing the declaratory
plaintiff to gain precedence in time or to change forums exist;
(5) whether the federal court is a convenient forum for the
parties and witnesses;
50
Brillhart v. Excess Ins. Co. of Am., 316 U.S. 491, 495 (1942).
51
Am. Guarantee & Liab. Ins. Co. v. Anco Insulations, Inc., 408 F.3d 248, 250 (5th
Cir. 2005).
52
St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 590 (5th Cir. 1994) (quoting Travelers Ins.
Co. v. La. Farm Bureau Fed’n, Inc., 996 F.2d 775, 778 (5th Cir. 1993)).
53
Vulcan Materials Co. v. City of Tehuacana, 238 F.3d 382, 390 (5th Cir. 2001)
(quoting Trejo, 39 F.3d at 590).
54
39 F.3d 585 (5th Cir. 1994).
11
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(6) whether retaining the lawsuit would serve the purposes of
judicial economy; and
(7) whether the federal court is being called on to construe a
state judicial decree involving the same parties and entered by
the court before whom the parallel state suit between the same
parties is pending. 55
Every circuit has a similar test.56 Across circuits, the Brillhart inquiry
is grounded in three fundamental concerns: federalism, fairness, and
efficiency. 57
A
The first Trejo factor considers “whether there is a pending state court
action in which all of the matters in controversy may be fully litigated.” 58 A
parallel state court proceeding raises Brillhart concerns about federalism and
efficiency. 59 Duplicative litigation in federal court, especially over matters of
state law, should be avoided. 60
The existence of a pending parallel state court proceeding is not
dispositive, but it is an “important factor” in the analysis. 61 When a related
state court proceeding “is not ‘parallel’ because it does not involve all the
same parties or issues,” the district court must consider “the extent of
55
Id. at 590-91.
56
Sherwin-Williams Co. v. Holmes Cnty., 343 F.3d 383, 390 (5th Cir. 2003)
(collecting cases).
57
Id. at 390-91.
58
Trejo, 39 F.3d at 590.
59
Sherwin-Williams, 343 F.3d at 394.
60
See id. at 391-92.
61
Id. at 394.
12
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similarity between the pending state court and federal court cases.” 62 The
greater the overlap, the more likely that a stay will promote federalism and
efficiency. 63
The district court ruled that the first factor favored a stay. The court
reasoned that the factual and legal issues coincided because “the state court
action arises out of the same facts and circumstances, and involves the same
contractual issues as this declaratory judgment action.” The court
recognized that KPS was not a party to the state court proceeding but did not
deem this distinction significant because KPS had the same interests as
Switzer and the Koch affiliates.
The district court correctly determined that the federal and state court
proceedings are connected. Both involve claims of tortious interference
based on the same set of noncompete provisions in the same set of contracts.
The related state court proceeding governing state law issues raises concerns
about federalism and efficiency that favor a stay.
B
The next three Trejo factors consider whether the declaratory
judgment plaintiff filed suit in anticipation of a lawsuit filed by the defendant,
engaged in forum shopping in bringing the action, and would create potential
62
Id. at 394 n.5.
63
See id. at 390, 394.
13
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inequities by gaining precedence in time or changing forums. 64 These factors
raise Brillhart concerns about fairness. 65
The district court ruled that, on the whole, these fairness factors
favored a stay. As to the second factor, the court correctly recognized that
the federal proceeding was “not filed in anticipation of, but in response to”
the state proceeding. Nevertheless, the court concluded that this response
was unfair. Because “KPS’s interests in this declaratory action are the same
as the interests of [its] president, Switzer, and [its] parent companies in the
state court action,” the declaratory action was “in fact, an effort by KPS not
only to forum shop, but also to gain precedence by having this court instead
of the state court decide the issues raised by the tortious interference claims
asserted in both actions.”
The district court did not abuse its discretion in concluding that KPS
sought to forum shop and to gain unfair precedence. It is true that a mere
preference for a federal forum “does not necessarily demonstrate
impermissible forum selection.” 66 An out-of-state plaintiff may properly
invoke federal jurisdiction to avoid the potential bias of a state forum. 67
Protecting out-of-state defendants like KPS is “the traditional justification
for diversity jurisdiction.” 68 In this case, however, the record adequately
supports the district court’s determination that the declaratory action was
not a mere effort to avoid state court bias. The overlap between the state and
federal proceedings suggests that KPS intends to reassign adjudication of
64
St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 590-91 (5th Cir. 1994).
65
Sherwin-Williams, 343 F.3d at 391.
66
Id. at 399.
67
Id.
68
Id.
14
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No. 21-20093
shared legal and factual issues to the federal court. KPS says as much in its
federal complaint. In KPS’s words, “[t]his declaratory judgment action
arises from Defendants’ public and erroneous allegations that KPS is
unlawfully competing with Defendants.” KPS seeks declarations of non-
interference “so that it may fairly compete in the marketplace without the
distraction and harm associated with Defendants’ meritless contentions.”
The purpose of its lawsuit is to have the federal court declare Triten’s state
court allegations wrong.
This court has previously drawn a connection between the degree of
overlap in state court proceedings and procedural inequity. 69 When federal
and state court actions are related, the federal action risks “changing forums
or subverting the real plaintiff’s advantage in state court.” 70 These risks
dissipate when the federal action pertains to separate claims. In this case, the
relationship between the state and federal proceedings threatens
impermissible meddling with Triten’s lawsuit. This threat supports the
district court’s conclusion that, in sum, the fairness factors favor a stay.
69
See Sherwin-Williams, 343 F.3d at 399 (rejecting unfairness when there was no
“race to res judicata”); Ironshore Specialty Ins. Co. v. Tractor Supply Co., 624 F. App’x 159,
167-68 (5th Cir. 2015) (per curiam) (unpublished) (denying procedural inequity when “the
state court action did not involve the same parties or the same legal issues,” thereby
negating the risk of preclusion).
70
Sherwin-Williams, 343 F.3d at 399 (quoting Travelers Ins. Co. v. La. Farm Bureau
Fed’n, Inc., 996 F.2d 775, 777 (5th Cir. 1993)).
15
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No. 21-20093
C
The fifth Trejo factor considers “whether the federal court is a
convenient forum for the parties and witnesses.” 71 This factor “primarily
address[es] efficiency considerations.” 72
The district court ruled that the federal and state courts were equally
convenient, so this factor was neutral. KPS does not dispute the convenience
of the federal court, but it argues that this convenience militates in its favor.
We are not rigid in prescribing the role that convenience must play in the
district court’s analysis. 73 The district court did not abuse its discretion in
ruling this factor neutral.
D
The sixth Trejo factor considers “whether retaining the lawsuit would
serve the purposes of judicial economy.” 74 Federal courts “should avoid
duplicative or piecemeal litigation where possible.” 75 Judicial economy
corresponds primarily to Brillhart’s concern about efficiency. 76 Judicial
economy may also implicate concerns about federalism and comity,
71
St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 591 (5th Cir. 1994).
72
Sherwin-Williams, 343 F.3d at 391.
73
See, e.g., Ironshore Specialty Ins. Co. v. Tractor Supply Co., 624 F. App’x 159, 168
(5th Cir. 2015) (per curiam) (unpublished) (holding that this factor “weighs against
dismissal” when there was no indication that the federal court was inconvenient); RLI Ins.
Co. v. Wainoco Oil & Gas Co., 131 F. App’x 970, 973 (5th Cir. 2005) (per curiam)
(unpublished) (finding no abuse of discretion when the federal and state forums were both
of “relative convenience” and the district court ruled this factor “neutral”).
74
Trejo, 39 F.3d at 591.
75
Sherwin-Williams, 343 F.3d at 391.
76
Id.
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especially when duplicative litigation could produce conflicting judgments on
matters of state law. 77
The district court held that this factor favored a stay. The court
reasoned that the declaratory judgment action would produce inefficient
piecemeal litigation because the state lawsuit involves claims besides tortious
interference that the federal lawsuit would not resolve. By contrast, “all
issues raised by the claims asserted in this declaratory judgment action can
be resolved in the state court proceeding.”
The district court correctly concluded that a stay would serve judicial
economy. The resolution of the state lawsuit may or may not resolve the
claims in the federal lawsuit. As the district court noted, however, there is
no question that the federal lawsuit will not resolve the claims in the state
lawsuit. For example, the federal lawsuit will not resolve claims by Switzer
against Triten for compensation that Triten allegedly failed to pay him.
When state court proceedings involve claims or parties beyond those in the
federal declaratory judgment action, this court has held that efficiency
concerns counsel against asserting jurisdiction. 78 A stay may not avoid
piecemeal or duplicative litigation, but proceeding with the federal action
ensures it.
The federal action also raises concerns about federalism. Duplicative
litigation in the federal court about state law matters—tortious interference
77
Id.
78
See id. (“A federal court should be less inclined to hear a case if necessary parties
are missing from the federal forum, because that leads to piecemeal litigation and
duplication of effort in state and federal courts.”); Am. Emps.’ Ins. Co. v. Eagle Inc., 122 F.
App’x 700, 703-04 (5th Cir. 2004) (per curiam) (unpublished) (affirming a stay order when
“a federal court cannot rule conclusively” on all the issues raised in the state court
proceedings so “it would not be more efficient for a federal court to initially hear the
claims”).
17
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with Triten’s contracts—creates “the potential for inconsistent state and
federal court judgments.” 79 A stay reduces this risk. For reasons of
efficiency as well as federalism, this factor favors a stay.
E
The seventh Trejo factor considers “whether the federal court is being
called on to construe a state judicial decree involving the same parties and
entered by the court before whom the parallel state suit between the same
parties is pending.” 80 This factor addresses Brillhart’s concern about
federalism. 81
Because this case does not involve the construction of a state judicial
decree, the district court deemed this factor “not relevant.” KPS contends
that the absence of a state decree is not irrelevant but rather disfavors a stay.
This court has not dictated the weight that district courts must place on the
absence of a state decree. One decision held that it “weighs strongly” in
favor of the declaratory judgment plaintiff, 82 while another approved of the
district court’s determination that this factor was “not implicated.” 83 KPS
does not give any reason why the absence of a state judicial decree warrants
special significance in this case. In fact, KPS concedes that there is “no
meaningful dispute” on this point. Given the variation in acceptable
79
Sherwin-Williams, 343 F.3d at 391.
80
St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 591 (5th Cir. 1994).
81
Sherwin-Williams, 343 F.3d at 392.
82
AXA Re Prop. & Cas. Ins. Co. v. Day, 162 F. App’x 316, 321 (5th Cir. 2006) (per
curiam) (unpublished).
83
RLI Ins. Co. v. Wainoco Oil & Gas Co., 131 F. App’x 970, 973 (5th Cir. 2005) (per
curiam) (unpublished).
18
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No. 21-20093
interpretations, the district court did not abuse its discretion in rejecting the
relevance of this factor.
F
The seven Trejo factors are “nonexclusive.” 84 KPS asserts additional
concerns about unfairness that would result if the state court action were to
preclude the federal court action. As explained above, however, the
preclusive effect of the state court’s ruling is unknown. This unsubstantiated
fear does not bear on the analysis.
In addition to considering the Trejo factors, a district court must also
“address[] and balance[] the purposes of the Declaratory Judgment Act.” 85
KPS argues that the stay order defies the purposes of the statute by
obstructing KPS’s attempt to clarify its rights. It is true that “[a] proper
purpose of section 2201(a) is to allow potential defendants to resolve a
dispute without waiting to be sued.” 86 However, the district court
reasonably concluded that a stay was consistent with that purpose. Triten
had already sought to resolve the dispute in some measure by asserting
related claims in state court.
In sum, we conclude that the district court did not abuse its discretion
in granting the stay. The presence of a related pending action in state court
implicates Brillhart’s concerns about federalism, fairness, and efficiency that
support the district court’s stay decision.
84
Sherwin-Williams, 343 F.3d at 388.
85
Vulcan Materials Co. v. City of Tehuacana, 238 F.3d 382, 390 (5th Cir. 2001)
(quoting St. Paul Ins. Co. v. Trejo, 39 F.3d 585, 590 (5th Cir. 1994)).
86
Sherwin-Williams, 343 F.3d at 397.
19
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No. 21-20093
IV
Finally, we turn to the parties’ motions for judicial notice. Both
concern documents from the related state court proceedings.
Under Federal Rule of Evidence 201, a court “may judicially notice a
fact that is not subject to reasonable dispute.” 87 Such facts include those that
“can be accurately and readily determined from sources whose accuracy
cannot reasonably be questioned.” 88 An appellate court may take judicial
notice of facts, “even if such facts were not noticed by the trial court.” 89 On
several occasions, this court has taken judicial notice of court proceedings
relevant to the case being decided. 90
We grant both motions. The state court proceedings are relevant to
this action because they elucidate the nature of the claims the parties have
made and the defenses they have raised, and they show the status of those
proceedings. Of course, our notice of these documents does not mean that
we accept the assertions in the state court pleadings as true. Rule 201 permits
judicial notice only of facts that are “not subject to reasonable dispute.” 91
The test for indisputability is stringent. Assertions in pleadings that are not
otherwise obvious cannot clear Rule 201’s “‘indisputability’ hurdle.” 92
87
Fed. R. Evid. 201(b).
88
Id. 201(b)(2).
89
United States v. Herrera-Ochoa, 245 F.3d 495, 501 (5th Cir. 2001); see also Fed.
R. Evid. 201(d) (“The court may take judicial notice at any stage of the proceeding.”).
90
See, e.g., Alexander v. Verizon Wireless Servs., L.L.C., 875 F.3d 243, 248 n.8 (5th
Cir. 2017); United States v. Verlinsky, 459 F.2d 1085, 1089 (5th Cir. 1972); Paul v. Dade
Cnty., 419 F.2d 10, 12 (5th Cir. 1969).
91
Fed. R. Evid. 201(b).
92
Taylor v. Charter Med. Corp., 162 F.3d 827, 830 (5th Cir. 1998).
20
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* * *
For the reasons stated, we AFFIRM the district court’s stay order
and GRANT the parties’ motions for judicial notice.
21 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490504/ | MEMORANDUM OPINION ON MOTIONS FOR SUMMARY JUDGMENT
ROBERT C. McGUIRE, Chief Judge. Introduction
This matter was submitted to the Court on May 18, 1987. The Court, having reviewed the applicable case law and all motions and briefs, files this memorandum opinion which shall constitute findings of fact and conclusions of law pursuant to Bankruptcy Rule 7052.
This Court finds that it is appropriate for this Court to utilize Bankruptcy Rule 7056 in this adversary proceeding. Bankruptcy Rule 7056 incorporates FRCP 56, which is the summary judgment rule.
The sole issue for determination by this Court is whether or not, Defendant Ron Watkins, Inc. (“Watkins”) possesses a constitutional lien, and, if so, is it valid and enforceable against the trustee’s avoidance powers as a hypothetical bona fide purchaser under 11 U.S.C. § 544.
Factual Background
The facts in this case are uncontroverted. They can be summarized as follows:
1. At the commencement of this bankruptcy case, Marquee East Investors, Ltd. (“Debtor”) was the owner of property more commonly known as the Marquee East Apartments, 511 Gaston Avenue, Dallas, Texas, more particularly described as Lots 3, 4, 5, and Southwest 5 fee of Lot 6 in Block 12/1862, of Munger Place, City of Dallas, Dallas County, Texas (the “Property”).
2. Watkins contracted with Debtor and supplied labor and/or materials for improvements at the Property.
3. On January 30, 1985, Watkins filed, in Dallas County, Texas, a lien affidavit for the purpose of perfecting statutory and constitutional mechanic and mate-rialmen’s liens against the Property because of the nonpayment of debt.
4. The lien affidavit filed by Watkins properly described the Property, and was filed in the proper county.
5. Debtor filed for bankruptcy on March 1, 1985.
6. Watkins is an original contractor under Chapter 53 of the Texas Property Code.
7. Watkins is a mechanic, artisan and such, or materialman for purposes of *501Article 16, Section 37 of the Texas Constitution.
8. The work for which Watkins is claiming its lien was performed on the Property between March and August, 1984.
9. Watkins' lien affidavit expressly states that it was filed for the purpose of perfecting its constitutional lien.
Discussion
In Texas, a constitutional lien is self-executing and exists without the necessity of complying with the filing provisions of the Texas Property Code. However, Watkins’ lien affidavit stated that it was filed “for the purpose of perfecting statutory and constitutional liens....” Since the lien was filed prior to the commencement of this bankruptcy case, the filing of the lien affidavit constituted notice for deciding whether or not the trustee for Debt- or’s bankruptcy estate (“Trustee”) is a bona fide purchaser under Bankruptcy Code § 544. Under Texas law, the constitutional lien is self-executing and enforceable against subsequent purchasers so long as subsequent purchasers have actual or constructive notice of the lien. The Trustee, as a hypothetical property purchaser, is therefore deemed to have notice of Watkins’ filed constitutional lien, and, therefore, Watkins’ lien interests cannot be avoided under § 544.
The Texas bankruptcy cases cited by the Trustee are distinguishable. See, In re Boots Builders, Inc., 11 B.R. 635 (Bkrtcy.N.D.Tex.1981) (“Boots ”) and In re Ernest & Associates, Inc., 59 B.R. 495 (Bkrtcy.W.D.Tex.1985) (“Ernest ”). In Boots, Judge Flowers ruled that the original contractor failed to perfect its lien because the affidavit did not sufficiently describe the property. In addition, the Court found that the air conditioning system installed did not fall within the scope of liens granted under the Texas Constitution. In Ernest, Judge Ayers found that, since the original contractor failed to file and perfect its lien, the debtor-in-possession could avoid this unper-fected lien. The Court then concluded that the original contractors constitutional lien was unenforceable against a bona fide purchaser and, accordingly, must fall under § 544. This Court notes that neither of those cases deals with the situation presently involved where the original constractor properly filed a constitutional lien prior to the filing of the bankruptcy.
Conclusion
Based on the foregoing, the Court finds that the Trustee had notice, as of the commencement of this case, of Watkins’ constitutional lien, and is, therefore, precluded from avoiding the lien under 11 U.S.C. § 544. In granting Watkins’ motion for summary judgment, the Court finds that this lien claim should be satisfied from those funds escrowed in connection with the previous sale of this Property. The Trustee’s motion for summary judgment is denied.
The Court reserves the right to make further findings of fact and conclusions of law, if necessary. Where appropriate, a finding of fact shall be considered a conclusion of law, and vice versa.
An appropriate order will be entered in accordance with the foregoing opinion. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490505/ | MEMORANDUM OF OPINION CONCERNING LAWLER’S COMPLAINT AGAINST BRINKERHOFF
JOHN C. AKARD, Bankruptcy Judge.
Procedural Background
On January 9, 1976, an involuntary petition in bankruptcy was filed against H. *992Roger Lawler (Lawler) in the District of Nevada. The case was transferred to the Northern District of Texas, Dallas Division, on June 6, 1976 and on January 20, 1978 Lawler consented to an adjudication of bankruptcy. For a time the case was administered under Chapter VII of the Bankruptcy Act with L.E. Creel, III (Creel) acting as Receiver and Trustee. Subsequently, the case was converted to a Reorganization under Chapter XI of the Bankruptcy Act with Creel acting as the Operating Trustee and Disbursing Agent. Apparently, through various actions brought by the Trustee, it was determined that Lawler was solvent. A “New Plan of Arrangement” was confirmed on April 30, 1984. One of the provisions of that Plan was that unsecured creditors were to receive the full amount of their claims together with interest on that amount from January 9, 1976.
On April 27, 1984, Larry Brinkerhoff, reciting that he had formerly done business as Brinkerhoff Pump & Drilling Co. (Brink-erhoff), filed a claim in these proceedings for $23,435.40. The claim was for work done during 1974 and 1975, almost ten years prior to the filing of the claim, but within two years prior to the filing of the involuntary petition against Lawler. The claim is No. 103 on the Court’s Claim Docket.
By Order dated June 14, 1985, Creel was relieved of his responsibilities and instructed to pay from deposits which he held as Disbursing Agent, his own authorized fees and expenses of $39,669.90 as well as the sum of $1,941,747.00 to Robert Yaquinto, as Special Disbursing Agent and Michael Youdin, Clerk of the U.S. Bankruptcy Court for the Northern District of Texas, to be held jointly and to be disbursed pursuant to the terms of that Order. Any funds remaining were to be paid to Lawler. The June 14, 1985 Order specified that the funds held by Yaquinto and Youdin were to be placed in various accounts for identified creditors of the estate. Included in this account was an amount of $306,747.00 to be held for unpaid creditors who are identified on Exhibit A to the Order. Brinker-hoff Pump is listed on Exhibit A as holding Claim No. 103 in the amount of $23,435.40 with interest to date in the amount of $22,-263.63 for a total of $45,699.03. The Order provides as follows:
(c) The amount of $306,747 which is hereby fixed by the Court as the amount necessary to fully to protect the unpaid creditors of the estate, priority, unsecured and secured identified on Exhibit A hereto, which shall be held in an account to be designated the “Lawler Creditors Trust Account”, pending final determination of the claims of such creditors; at such time as the claim of any creditor whose claim is secured under this paragraph is determined by a final order of a court of competent jurisdiction, the funds of the Lawler Creditors’ Trust Account shall be disbursed to such creditor, to the extent required by such order and, to the extent the amount to be disbursed to such creditor is less than the amount of the creditor’s claim, plus interest as provided under the New Plan of Arrangement, then the remainder shall be immediately disbursed to H. Roger Lawler; the funds securing the claims with interest of all scheduled creditors who do not file proofs of claims within the time specified in Rule 355 of the Bankruptcy Rules of 1973 shall be immediately disbursed to H. Roger Lawler.
The Order further provides that claimants shall look solely to the appropriate deposit designated for payment and not to Lawler.
On August 15, 1984, Lawler filed an Objection to Claim 103 and various other claims asserting that they were filed after March 1, 1984, which was, according to Lawler, the Bar Date established by the Court. That ground of objection was apparently resolved between the Trustee and Lawler because it does not appear further. On February 15, 1985, Lawler filed an Amended Objection stating that “the Debt- or lacks knowledge that goods and services were provided by the claimant.”
On May 16, 1985, Lawler filed a Complaint against Brinkerhoff asserting that the invoices attached to Brinkerhoff’s claim showed that four invoices totaling $9,477.93 were addressed to Lloyd Ginno-chio (or Ginnochio Livestock Co.) and that *993Brinkerhoff thereby made a knowing misrepresentation of fact in the Proof of Claim. Lawler asserted that he relied on this misrepresentation in determining the amount of deposit to be made pursuant to the New Plan of Arrangement and that since that time he paid interest on the amounts which were deposited to cover Brinkerhoff’s claim. Lawler further asserted that he incurred significant attorneys’ fees in defending the “fraudulent claim of Brinkerhoff.” The Complaint requested that Brinkerhoff’s claim be denied, that Lawler be awarded actual damages in the amount of $45,699.03 representing the deposit set aside to secure the Brinkerhoff claim with interest through June 11, 1985, and that Lawler receive punitive damages in the amount of $100,000.00 and $20,-000.00 attorneys’ fees.
The foregoing Complaint was filed on the eve of a hearing on Lawler’s Objection to Brinkerhoff’s claim held on May 17, 1985 before the Honorable John C. Ford, United States Bankruptcy Judge. This Court reviewed the transcript. Judge Ford conducted the hearing only on Lawler’s Objection to the Claim and did not hear the Complaint because it had only been filed the preceding day.
Judge Ford ruled from the bench at the May 17, 1985 hearing. On June 11, 1985, he signed Findings of Fact and Conclusions of Law. Subsequently, the parties filed an Agreed Order Vacating the Findings of Fact and Conclusions of Law dated July 22, 1985. The parties anticipated that Judge Ford would be able to review this matter and render a decision prior to his retirement from the bench. Unfortunately, he was unable to do so. On March 27, 1986, the entire Lawler case was transferred to the Lubbock Division of the Northern District of Texas because both of the Dallas Bankruptcy Judges had recused themselves. At a status conference on May 28, 1986, the attorneys for Brinkerhoff and Lawler agreed that this Court could review the transcript of the May 17, 1985 hearing and the record of this matter to determine the Objection to Claim. After such review, this Court determined that Judge Ford’s verbal Order of May 17, 1985 allowed Brinkerhoff’s Claim in the amount of $13,-815.30, plus interest as specified in the New Plan of Arrangement, and disallowed the Claim to the extent of $9,620.10 with respect to the Ginnochio invoices. This Court’s Order Concerning the Claim of Larry Brinkerhoff dated July 21, 1986 has not been appealed.
After proper notice, on September 8, 1986, this Court allowed the attorneys for Brinkerhoff to withdraw for the reason that they had not received any compensation. No other attorneys have appeared on Brinkerhoff’s behalf, nor has he appeared in these proceeding in any manner subsequent to that time.
The hearing on Lawler’s Complaint against Brinkerhoff was scheduled for October 14, 1986. Notice of hearing was given to Brinkerhoff’s attorneys and the setting was mentioned in the Order of July 21, 1986. The attorneys assured the Court that Brinkerhoff was aware of that setting. He did not appear on October 14, 1986. Due to the crowded condition of the Court’s calendar on that date, the Court was not able to reach Lawler’s Complaint against Brinkerhoff and, by announcement made in open Court, the matter was continued to December 8, 1986. No further written notice was sent to Brinkerhoff and he did not appear on December 8, 1986.
Issues
As requested by the Court, Lawler submitted a Pretrial Order. This Court's directives require that the Pretrial Order be jointly submitted by the parties. The proposed Pretrial Order submitted by Lawler indicated that a draft had been submitted to Brinkerhoff, but that no response was received.
Lawler’s proposed Pretrial Order reiterated the grounds stated in the Objection including a reference to 18 U.S.C. § 152. That section makes it a criminal offense to knowingly and fraudulently make a false oath or account in a bankruptcy proceeding. This is a criminal statute and does not offer any civil relief. Consequently, it is inapplicable to the present proceeding.
*994The Pretrial Order mentioned Rule of Bankruptcy Procedure 911 which applied to Bankruptcy Act cases. The proposed Pretrial Order also mentioned present Bankruptcy Rule 9011 which was promulgated after adoption of the Bankruptcy Code. In pertinent part, these rules are the same and both, basically, are the same as Fed.R. Civ.P. 11. None of these Rules were mentioned in the Complaint in which Lawler filed against Brinkerhoff in 1985.
Rule of Bankruptcy Procedure 911 provides:
If a pleading or written motion or application, is not signed or is signed with intent to defeat the purpose of this Rule, it may be stricken as sham and false, and the case may proceed as though the paper had not been served or filed. For a willful violation of this Rule, an attorney may be subjected to appropriate disciplinary action.
The sanctions under Bankruptcy Rule 9011 are more substantial. That Rule provides:
If a document is signed in violation of this Rule, the Court on Motion or on its own initiative, shall impose on the person who signed it, the represented party, or both, an appropriate sanction, which may include an Order to Pay the other party or parties the amount of the reasonable expenses incurred because of the filing of the document, including a reasonable attorney’s fee.
The only portion of the Complaint describing any improper actions on the part of Brinkerhoff is the following:
In alleging that Lawler is indebted to Brinkerhoff for services provided to Gin-nochio or his cattle company and invoiced to such other persons, Brinkerhoff made a knowing material misrepresentation of fact regarding the liability of Lawler for the amount set forth in the Proof of Claim.
The issues of fact as stated by Lawler in the proposed Pretrial Order are:
1. Whether Brinkerhoff presented a false and/or fraudulent Proof of Claim against the estate of Lawler by making material misrepresentation of fact regarding the liability of Lawler for the amount set forth in the Proof of Claim. Lawler’s position is that this issue is concluded by the Order Concerning the Claim of Larry Brinkerhoff signed on July 12, 1986 in which this Court determined that $9,620.10 of the claim was incorrectly based on invoices directed to entities other than Brinkerhoff.
2. Whether Brinkerhoff knowingly presented the false and/or fraudulent Proof of Claim. Lawler’s position is that this issue is concluded by the Order Concerning the Claim of Larry Brinkerhoff signed on July 21, 1986 in which this Court determined that $9,620.10 of the claim was incorrectly based on invoices directed to entities other than Brinkerhoff.
The balance of the issues as stated by Lawler relate to violation of Bankruptcy Rules and the damages suffered by Lawler.
Discussion
This Court’s ruling of July 21, 1986 was simply to document the ruling which Judge Ford made at the May 17, 1985 hearing. For this reason, this Court again carefully reviewed the transcript of that hearing and Brinkerhoff's claim in these proceedings.
First turning to the claim: It was filed in the amount of $23,435.40 on April 27, 1984 by Larry Brinkerhoff formerly doing business as Brinkerhoff Pump & Drilling Co. Two ledger sheets and several invoices were attached to the claim. One ledger sheet was on Lawler Cattle Co. (which is one of Lawler’s businesses and is part of these consolidated proceedings). The ledger sheet begins with September, 1983. Charges totaling $31,000.00 were paid in October, 1983. Various other charges were made in December, 1984 and March, 1985. The last entry is dated August 2, 1985 and shows a balance of $13,815.30. At one point a check in the amount of $1,500.00 dated April 16, 1984 received from Ginnochio Livestock Co. was credited *995to this account, but the entry was crossed out.
The other ledger sheet was on Ginnochio Livestock Co. It contained the notation “See file on: Lawler Cattle Company, Box 40, Gerlach, Nev.” There are a number of entries on that ledger sheet ending with a statement of October 7, 1974 for a balance of $9,620.10. At one point a check for $9,477.73 was received on the account but it was returned for insufficient funds.
The invoices attached appear to substantiate the entries on the ledger sheets. At the May 17, 1985 hearing, it was established that Mr. Lawler had a large ranch in Nevada upon which there were a number of water wells. Brinkerhoff serviced those wells at various times at the request of the ranch managers. Mr. Lawler had no direct knowledge of the day-to-day operations of the ranches because he left those to the ranch managers. He also relied on them to forward appropriate bills to his office in Dallas. Apparently he had difficulty with some of the managers because the testimony indicated that he fired two of them.
Mr. Brinkerhoff testified that he had formerly operated Brinkerhoff Pump & Drilling Company in Winnemucca, Nevada, which was approximately 125 miles from Gerlach, Nevada, where Lawler’s ranch was located. Testimony indicated that the Ginnochio ranch was located in the same area.
At the May 17, 1985 hearing there was no proof presented, other than the statements on the ledger cards, that the charges to Lawler Cattle Co. and Ginnochio Livestock Co. were related. Judge Ford therefore ruled that Brinkerhoff “is going to get just about what a lot of times these lawyers accuse me of doing, trying to strike a happy medium which is what he filed for. That’s $13,815.30 and he’s entitled to interest on that from the date this bankruptcy case was filed ...” (Tr. 51-52).
This Court’s Order of July 21, 1986 did no more than follow Judge Ford’s finding of allowing the claim of Brinkerhoff in the amount of $13,815.30 plus interest and deny the balance.
Lawler’s position is that since a portion of Brinkerhoff’s claim was denied, the claim must be considered false or fraudulent. The facts of this case lend no support whatsoever to that conclusion.
Brinkerhoff was no longer in the pump business. The claim was prepared in 1984 based upon records that were approximately ten years old. Certainly the reference to Lawler Cattle Company on the Ginnochio Livestock Co. ledger sheet would cause someone to believe that they were related. They were at least close to each other, if not adjacent, and they had similar problems. In this Court’s experience, it is not uncommon for ranchers who have property in the same proximity to work together on a number of matters together, including water wells.
Lawler’s attorneys had ample opportunity at the May 17, 1985 hearing to ask of Brinkerhoff why he included the Ginnochio Livestock Co. invoices in the claim, but they failed to do so.
There was no evidence presented at the May 17, 1986 hearing that the inclusion of the Ginnochio Livestock Co. invoices was false or fraudulent. The only conclusion that can be drawn is that there was a bookkeeping error which was carried forward when the claim was prepared some ten years after the fact.
Lawler cannot rely on the fact that Brinkerhoff did not appear at hearing nor that Brinkerhoff filed no response to the Complaint as none is required under the Rules. The burden is on Lawler to prove his case. This he failed to do.1
Damages
Although this Court concluded that the claim filed by Brinkerhoff was neither *996false nor fraudulent, to date Lawler has apparently appealed every adverse ruling made by a Bankruptcy Judge in this case. For that reason, the Court feels bound to comment concerning damages.
At the time Brinkerhoff filed his claim, Rule of Bankruptcy Procedure 911 was in force. It is the opinion of the Court that Rule 911 controls this case. The only sanction granted by that Rule for the filing of a false or fraudulent matter by an individual is that it be stricken. Thus the maximum recovery Lawler would be allowed is denial of the Brinkerhoff claim in full.
Lawler’s proposed Pretrial Order, under the heading “Summary of Lawler’s Claim,” carries forward the four demands of the Complaint which are:
a. Denying the claim of Brinkerhoff. As indicated above, the Court feels that this is the maximum which Lawler would be allowed under any circumstances.
b. Awarding actual damages “in the amount of $45,699.00 representing the deposit set aside to secure the fraudulently filed claim of Brinker-hoff, with interest through June 11, 1985.” Lawler asserts that he had to make a loan to fund the Plan and has had to renew the loan to the current date. His testimony at the hearing on December 8, 1986 was that his interest on this account had been $13,785.00. In this régard, Lawler’s testimony conflicts with the Order of June 14, 1985 which recites that Creel, as Disbursing Agent, is directed “to pay from the current deposits which he holds as Disbursing Agent” (page 2) to Yaquinto and Youdin the sums described above. It may be that Lawler was required to borrow funds to deposit with Creel as Disbursing Agent, but that matter was not clear in the testimony. Even if Lawler did borrow funds to create this account, the funds held by Ya-quinto and Youdin have undoubtedly been placed in interest-bearing accounts and Lawler will receive whatever funds remain in the accounts after payment of creditors. Thus, Lawler will receive the interest on the funds held by Yaquinto and Youdin, which should offset the interest which he had to pay on the borrowed funds. Lawler’s testimony made no effort to give credit for the money, including interest thereon, which would be returned to him by Yaquinto and Youdin.
c. Awarding “punitive damages in the amount of $100,000.00.” There was absolutely no evidence to support the award of punitive damages. This is yet another example of Lawler attempting to use the Bankruptcy Court as a sword to extract funds from those with whom he dealt rather than its proper purpose of shielding a debtor while an appropriate reorganization is under way.
d. Awarding $20,000.00 “reasonable attorneys’ fees.” At the hearing on December 8,1986, Mr. Wesner, attorney for Lawler, stated that his fees and expenses in this matter totaled $5,145.50. He did not submit an itemized statement of those fees. The Objection to Brinkerhoff’s claim, the Amended Objection and the Complaint against Brinkerhoff were all filed by Lawler’s prior attorney. The prior attorney also appeared on Lawler’s behalf at the May 17, 1985 hearing. It appears that Mr. Wes-ner’s activities with respect to the Brinkerhoff claim consist of a conference with the Court and opposing counsel (which was one of a series of similar conferences all held during one afternoon) and preparation for, and attendance at the hearing on December 8, 1986. That hearing did not last more than one hour. The hearing was in Lubbock which required Mr. Wesner to travel to Lubbock for that purpose. The Court feels that, including travel expense, $2,500.00 would be a generous award of attorney’s fees and expenses in this matter. No evidence was presented concerning the attorney’s *997fees and expenses of Lawler’s prior attorney.
Consequently, if this Court had found that Brinkerhoff's claim violated Rule of Bankruptcy Procedure 911, this Court would have reduced the claim by $2,500.00 and ordered the balance paid with interest from January 9, 1976.
Conclusions
This Court concludes that Brinkerhoff’s claim is neither false nor fraudulent, that it does not violate Rule of Bankruptcy Procedure 911, Bankruptcy Rule 9011 or Fed.R. Civ.P. 11 and will order the Disbursing Agent to pay Brinkerhoff the sum of $13,-815.30 plus interest at the rate of 10% per annum from January 9, 1976 until the date of payment.
Order accordingly.2
. From the record in this case, one can readily imagine that Brinkerhoff is a man of modest means who could not afford to defend the continuous litigation which Lawler’s seeming inexhaustible supply of funds for attorneys’ fees generates. This is not the only instance known to this Court of a party "giving up” in order to avoid the further expenses of Lawler's constant pleadings. The fact that this case has been active in the Bankruptcy Courts since January 9, 1976 is indicative of Lawler’s litigious nature.
. This Memorandum shall constitute Findings of Fact and Conclusions of Law pursuant to Bankruptcy Rule 7052 which is made applicable to Contested Matters by Bankruptcy Rule 9014. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490506/ | *1006FINDINGS AND CONCLUSIONS ON REMAND
A. JAY CRISTOL, Bankruptcy Judge.
THIS CAUSE having come on to be heard on February 12 and March 14, 1987, upon remand for further proceedings from the United States District Court for the Southern District of Florida, and the Court, having heard the testimony and examined the evidence presented, having observed the candor and demeanor of the witnesses, having considered the arguments of counsel, and being otherwise fully advised in the premises, does hereby make the following findings of fact and conclusions of law:
THE PROCEDURAL BACKGROUND
Plaintiff, Bank of Commerce & Industry (“BCI”) commenced this adversary proceeding by filing a complaint on October 28, 1983. A second amended complaint was filed December 30, 1983. BCI sought to determine the amount, validity, and priority among mortgages and liens asserted against parcels of real property known as Sutton Place and owned by Sutton Place Development Co. (“Sutton Place”), the debtor in this bankruptcy proceeding, and to foreclose its own second mortgage and sell the property. On February 28, 1984, the adversary proceeding was tried before my predecessor, the Honorable Joseph A. Gassen. On September 7,1984, Judge Gas-sen entered Findings and Conclusions together with a Final Judgment Determining Amount, Validity and Priority of Liens and Foreclosing Mortgage, and held that the mortgage of Defendant, George D. Perl-man, Trustee (“Perlman”), was both valid and first in priority, established the amount of principal, accrued interest through the date of judgment, and per diem interest thereafter, and granted BCI a judgment of foreclosure subject only to the lien of the superior Perlman Mortgage. A foreclosure sale was held on November 9, 1984, and BCI bid in its lien and obtained title to the real property, subject to the Perlman Mortgage, pursuant to a Certificate of Title dated December 5, 1984.
BCI appealed. Perlman cross appealed certain of the Findings and Conclusions of *1007the Bankruptcy Court. Three issues were considered by the District Court: (1) the finding that Perlman’s attorneys’ fees were secured by the lien of his mortgage; (2) the finding that BCI consented to the two extension agreements between Sutton Place and Florida National Properties, Inc., in which the interest rate under the first mortgage was modified from 9% to YJlh%, or alternatively that BCI was estopped to deny subordination of its mortgage to those extension agreements; and (3) the finding that BCI had no right to redeem the Perlman Mortgage and, further, that BCI never made a proper tender. Perlman cross appealed two issues: (1) the finding that the Perlman Mortgage secured interest at the rate of 9% rather than Yllk% under the third extension agreement from March 17, 1983 until June 17, 1983, and (2) the application of a default interest rate of 18% rather than 25% under the Perlman Mortgage.
In its Order dated August 16, 1985, the District Court affirmed in part and reversed in part the decision of the Bankruptcy Court and remanded this case to the Bankruptcy Court for further evidentiary proceedings on the following issues: (1) whether a valid third extension agreement was entered into between Sutton Place and Perlman which cured the defaults under the Florida National mortgage and extinguished BCI’s right to redeem, and (2) if not, whether BCI made a legally proper tender to redeem the Florida National mortgage. The District Court held that further supplemental evidentiary proceedings were necessary to substantiate in the record the finding that (a) an effective extension of the first mortgage cured Sutton Place’s default and cut off BCI’s right to redeem, and (b) even if BCI had the right to redeem, it made an invalid and conditional tender; and (2) as to Perlman’s cross-appeal, the District Court (a) reserved ruling on whether the third extension interest rate of 17V2% was fully secured by the Perlman Mortgage until the Bankruptcy Court in supplemental evidentiary proceedings supported its initial finding that the extension was valid, and (b) held that the appropriate default interest rate under the third extension agreement, if valid, was 25% instead of 18% per annum because Perlman renewed the loan for a principal amount in excess of $500,000.00.
Thus, this Court considered only the limited issues on remand in the supplemental evidentiary proceedings: (1) whether a valid third extension agreement between Sutton Place and Perlman cured the default and extinguished BCI’s right to redeem, and (2) if not, whether BCI made a legally proper tender.
THE FACTUAL BACKGROUND
The Perlman Mortgage originated as a purchase money mortgage on the eastern parcel of the Sutton Place condominium development,, in the principal amount of $442,500 at 9% interest, given by Sutton Place to Florida National Properties, Inc. (“Florida National”), the original holder, on September 30, 1980, and payable on April 30, 1981. On October 1,1980, Sutton Place gave BCI a mortgage on both the eastern and western parcels of the development in the amount of $1,400,000. BCI made two further credit extensions secured by the same mortgage, in the amounts of $121,000 and $200,000. BCI was in second position on the eastern parcel, behind the first mortgage held by Florida National. The junior mortgage held by Abacus Mortgage and Investment Company is no longer in issue because it was foreclosed by BCI at the foreclosure sale held on November 9, 1984.
Because Sutton Place was unable to pay the first mortgage when it came due, Florida National and Sutton Place entered into an agreement extending the due date to October 31, 1981, and modifying the interest rate from 9% to On September 16, 1981, they agreed to a second extension until February 28, 1982, with interest continuing at 17V2% and eliminating the thirty day grace period.
On February 28,1982, the first mortgage went into default. In or around August 1982, Florida National initiated a foreclosure proceeding in which BCI was a defendant and cross-claimed to foreclose its own mortgage.
*1008On March 17, 1983, the Florida National note and mortgage were assigned to George D. Perlman as Trustee for David J. Deen — Steinberg, Inc. (“Deen”). George Perlman, David J. Deen, and Henry Weiss, principal of Sutton Place, testified that they also entered into a third extension agreement which reinstated and extended the note and mortgage for one year at the pre-existing contractual interest rate of Yllh% per annum on $569,441.96, the total amount of consideration paid by Perlman and the full amount claimed by Florida National, including principal, interest, costs and attorneys’ fees as provided in the note and mortgage. On March 18,1983, Florida National voluntarily dismissed its foreclosure action.
On March 23, 1983, BCI offered Perlman a cashier’s check in the amount of $560,-084.52 expressly conditioned upon there having been no extension of the final due date “thus rendering the subject mortgage and note past due and currently in default.” (March 23, 1983 letter from Mark Butler to George Perlman, Perlman Exhibit C in the 2-28-84 trial). Perlman advised BCI that he could not accept the offer because his beneficiary was on vacation until April 6, 1983, because the offer was incapable of acceptance by its own terms in that the note and mortgage had been extended and were not in default, and because the offer was less than the amount paid by Perlman to acquire the note and mortgage. The next day, March 24, 1983, BCI filed suit against Perlman in the Bro-ward County Circuit Court to redeem the property. BCI never tendered any money into the court registry for Perlman to accept in that action. In August 1983, Sutton Place filed a petition for relief under Chapter 11 of the Bankruptcy Code.
VALIDITY OF THE THIRD EXTENSION AGREEMENT
The Court finds that there was a valid extension agreement between Perlman and Sutton Place. The extension agreement was clearly binding between Perlman and Sutton Place, and was valid and in existence at the time BCI attempted to redeem the mortgage.
This finding is supported by the uncon-troverted testimony of Perlman, Deen and Weiss. The extension agreement was negotiated and entered into by the parties to be effective concurrent with the assignment of the note and mortgage to Perlman by Florida National on March 17, 1983. The terms of the agreement included a one year extension of the maturity date of the note and mortgage at the pre-existing interest rate of 17V2% on $569,441.96, the total amount claimed by Florida National as due and owing as of March 16, 1983 and the amount paid by Perlman, which included principal, interest, costs and attorneys’ fees.
Parol agreements to extend mortgages are valid in Florida. Wolkowsky v. Kirchick, 81 Fla. 415, 88 So. 261 (1921). Thus, where the credible testimony of the parties to the agreement has not been controverted, the Court finds that a legally enforceable and valid third extension agreement existed at the time BCI attempted to tender to Perlman to redeem the mortgage.
RIGHT OF REDEMPTION
BCI did not have a right to redeem the mortgage on March 23, 1983, because the third extension agreement cured the default and extinguished any right of BCI to redeem. BCI could have bought the mortgage had Perlman been willing to sell it for a mutually agreeable price, but absent a mutual agreement, BCI did not have a right to redeem or acquire the mortgage on or after March 23, 1983.
INVALIDITY OF TENDER
The Court finds that, even if BCI had a right to redeem the mortgage, it failed to make a legally proper tender, directly or by pleading.
Because BCI never deposited any money into the court registry in its redemption action against Perlman, that tender fails as a matter of law. Kreiss Potassium Phosphate Co. v. Knight, 98 Fla. 1004, 124 So. 751, 754-55 (1929); Poinciana Hotel of Miami Beach, Inc. v. Kasden, 370 *1009So.2d 399, 403 (Fla. 3d DCA 1979) (Bark-dull, J., concurring). BCI simply did not make a valid tender by pleading under Florida law because it did not fulfill the requirement that the full amount necessary to redeem the mortgage be deposited into the court registry.
BCI’s delivery to Perlman of a check in the amount of $560,084.52 on March 23, 1983 did not constitute a legally proper tender because it was not an absolute, unconditional tender of the full amount due under the Perlman note and mortgage, kept present and available for Perlman’s acceptance at all times. The offer was expressly conditioned on there having been no extension of the due date. There had been an extension of the due date and therefore the attempted tender failed by its own terms. In addition, BCI offered an insufficient amount. Its offer did not include any amount for attorneys’ fees of $10,000 or for costs of $884.98 incurred by Florida National in its foreclosure action and paid by Perlman.
Under Florida law, where the mortgage and note expressly provide for payment of attorneys’ fees necessary to collect payment, whether or not through suit, expenditures for fees become part of the redemption price. Peppercorn v. Bencini, 101 Fla. 446, 134 So. 490 (Fla.1931). In the Motion for Summary Judgment served and filed by Florida National in its foreclosure action, Florida National claimed specific amounts for principal and interest, costs and attorneys’ fees and supported each amount with a sworn affidavit — one for principal and interest, one for costs and one for attorney’s fees. BCI was a defendant and cross-claimant in that suit and received copies of the motion and affidavits prior to its attempted tender to Perlman. The amount of BCI’s attempted tender to Perl-man was expressly based on the principal and interest affidavit filed by Florida National in support of its Motion for Summary Judgment. BCI had actual knowledge of the amount of costs and attorney’s fees incurred by Florida National up to the date of the affidavits, but did not include any amounts for costs or attorney’s fees in its attempted tender to Perlman. Hours before its attempted tender to Perlman on March 23, 1983, BCI was warned by Florida National that BCI’s offer of $560,084.52 was insufficient because it did not include any amount for costs and attorneys’ fees paid by Perlman. BCI considered whether it should increase its offer to include such amounts but decided not to do so. If BCI disputed the inclusion of attorneys’ fees it could have offered under protest the full amount due and owing. By failing to meet the elements of a proper tender, BCI made an imprudent business judgment, and as a consequence, failed to make a proper tender.
Florida law did not require Perl-man to notify BCI of the amount necessary to make a proper tender. The Florida National note clearly calls for attorneys’ fees and the Court finds that the evidence clearly shows that BCI either knew, or should have known, or could have known, the correct amount of attorneys’ fees and costs actually paid by Perlman, or which were being demanded by Perlman, and failed to offer or in some way provide for these amounts in addition to its tender of principal and interest due under the mortgage. Consequently, the delivery of a check by BCI to Perlman in an amount which did not include or provide for the $10,000.00 in fees and $884.98 in costs did not constitute a valid tender. Therefore, BCI cannot complain of a lack of notice of the amount due even if it was legally entitled to such notice.
AMOUNTS DUE AND SECURED UNDER THE PERLMAN MORTGAGE
As to Sutton Place, the original owner and mortgagor who agreed to the third extension and accepted the starting amount of $569,441.96 on March 17, 1983, Perlman is due, and his mortgage secures, the sum of $1,458,509.19 as of July 6, 1987, calculated as follows:
$ 569,441.96 Principal Amount of Mortgage & Note.
+ 25,117.85 3/18/88 to 6/17/83 = 92 days at 17.5% interest on $569,441.96.
*1010+ 166.152.78 6/18/83 to 8/17/84 = 426 days at 25% default interest on $569,441.96
760,712.59
+ 20,841.60 8/18/84 to 9/26/84 = 40 days at 25% default interest on $760,712.59
+ 79.515.33 Attorney’s Fees and Costs:' $90,400.31 - $10,884.98 = $79,515.33
861,069.52
+ 56,617.92 9/27/84 to 12/31/84 = 96 days at 25% interest on $861,069.52
+ 215,267.38 1985 interest at 25% on $861,069.52
+ 215,267.38 1986 interest at 26% on $861,069.52
+ 110,286.99 1/1/87 to 7/6/87 = 187 days at 25% on $861,069.52
$ 1.458,509.19
The amount chargeable against BCI, who did not accept the third extension, as the second mortgagee is $1,160,409.68 as of July 6, 1987, calculated as follows:
$ 442,500.00 Principal Amount of Mortgage & Note.
+ 33,309.12 9/26/81 to 2/28/82 = 157 days at 17.5% interest on $442,500.00
+ 83,360.04 3/1/82 to 3/17/83 = 382 days at 18% interest on $442,500.00
+ 10,884.98 Florida National Properties Attorney’s Fees and Costs
+ 19,998.96 3/18/83 to 6/17/83 = 92 days at 17.5% interest on $453,384.98; i.e. ($442,500.00 + $10,884.98)
+ 95.249.34 6/18/83 to 8/17/84 = 426 days at 18% interest on $453,384.98
685,302.44
+ 13,518.40 8/18/84 to 9/26/84 = 40 days at 18% interest on $685,302.44
+ 79,515.33 Attorney’s Fees and Costs of $90,400.31 - $10,884.98
+ 36,208.32 9/27/84 to 12/31/84 = 96 days at 18% interest on $764,817.77; i.e. ($685,302.44 + $79,515.33)
+ 137,667.20 1985 interest at 18% on $764,817.77
+ 137,667.20 1986 interest at 18% on $764,817.77
+ 70.530.79 1/1/87 to 7/6/87 = 187 days at 18% interest on $764,817.77
$ 1.160.409.68
(The principal amount of the note and mortgage chargeable against BCI as the second mortgagee, which did not consent to the third extension agreement, is under $500,000.00, and the default interest rate applicable to BCI as the second mortgagee is therefore 18% per annum. Without the second mortgagee’s consent, the mortgagor and senior mortgagee cannot enforce against the second mortgagee an agreement which puts the junior mortgagee in a worse position.)
MOTION TO DISMISS
The Court denies Perlman's motion to dismiss on the grounds of mootness and/or waiver and estoppel based on BCI’s previous foreclosure of its mortgage, its failure to stay the foreclosure judgment, and its purchase of the property at the foreclosure sale subject to the Perlman mortgage.
NOVATION
The Court finds that there was no novation and that BCI’s position that a novation of the Perlman note and mortgage occurred is without merit and is not in any way supported by competent evidence.
ATTORNEYS’ FEES
Pursuant to the provisions of the note and mortgage, the Court finds Perl-man is entitled to recover, and his mortgage secures, his costs and expenses, including reasonable attorneys’ fees, in protecting the security of his mortgage and defending the actions brought against him by BCI. The Court rejects the argument of BCI that the Note and Mortgage do not provide for the recovery of costs and expenses, including attorneys’ fees, in a non-collection proceeding such as these where one creditor is attacking another creditor. Absent agreement of the parties, the Court shall determine the amount of costs, expenses and attorneys’ fees to be awarded Perlman upon appropriate motion and hearing, following which the Court will enter such supplemental or amended order or judgment as may be appropriate.
MOTION FOR SANCTIONS
Perlman’s motion for sanctions against BCI based on the non-appearance of attorney Alvin Becker at the trial on Remand, after obtaining a continuance based on representations of the need for *1011his personal attendance at the trial of this cause, is GRANTED. The Court finds the appropriate sanction to be imposed against BCI is the sum of $1500.00, which sum Perlman shall recover of BCI, with interest thereon as provided by law.
A Final Judgment on Remand has been entered in conformity herewith.
FINAL JUDGMENT ON REMAND
This adversary proceeding came before the Court on February 12 and March 14, 1987 for trial on remand. Based upon the evidence and matters presented, the Court has by separate memorandum decision entered its findings and conclusions. It is therefore
FOUND, ORDERED AND ADJUDGED as follows:
1. This Court has jurisdiction over the parties and the subject matter.
2. Defendant George D. Perlman, as Trustee (“Perlman”), is the owner and holder of that certain promissory note and first mortgage from Sutton Place Development Co. (“Sutton Place”) to Florida National Properties, Inc., dated September 30, 1980, recorded October 1, 1980 in Official Records Book 9115 at Page 768 of the Public Records of Broward County, Florida (“the note and mortgage”), which is hereby found to constitute a valid and perfected lien upon the property described therein in the amounts set forth in Paragraph 3 herein, which lien is superior to any other claim or estate in the property. The note and mortgage are and have been in default, and have been materially breached by the debt- or Sutton Place.
3. Perlman is due under the note and mortgage: $569,441.96 as principal; $809,-551.90 as interest through July 6, 1987; $79,515.33 for costs, expenses and attorney’s fees incurred in this adversary proceeding through September 26, 1984; additional costs, expenses and attorneys’ fees and interest thereon in amounts to be determined at a further hearing, following which the Court will enter such supplemental or amended order or judgment as may be appropriate; plus post-judgment interest beginning July 7, 1987 on the sum of $1,458,509.19 at the rate of 25% per annum.
4. Perlman shall have the right to seek foreclosure of his mortgage on the amounts due as set forth in Paragraph 3 herein. In any such foreclosure action, Plaintiff Bank of Commerce & Industry (“BCI”) shall have the right to redeem the property from the note and mortgage within the time permitted by law by paying Perlman the following amounts: $442,-500.00 as principal; $627,509.37 as interest through July 6, 1987; $10,884.98 for costs and attorney’s fees paid by Perlman on March 16, 1983; $79,515.33 for costs, expenses and attorney’s fees incurred in this adversary proceeding through September 26, 1984; such additional costs, expenses, attorneys' fees and interest thereon awarded pursuant to paragraph 3 above; plus post-judgment interest beginning July 7, 1987 on the sum of $1,160,409.68 at the rate of 18% per annum.
5. Perlman shall recover of BCI the sum of $1,500.00 as sanctions, with interest thereon as provided by law.
6. This Court retains jurisdiction of this adversary proceeding for the purpose of making any and all further orders and judgments herein as may be proper, including but not limited to deficiency judgment. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490509/ | FINDINGS OF FACT AND CONCLUSIONS OF LAW
A. JAY CRISTOL, Bankruptcy Judge.
The plaintiff John McKinley filed his complaint for a determination of discharge-ability of a debt owed to him by the defendant Roger Francis, under 11 U.S.Code § 523(a)(2)(A). The case was tried before the court on the amended pleadings. Based upon the evidence presented, the court makes the following findings of fact:
FINDINGS OF FACT
Plaintiff as seller and defendant as buyer entered into a contract for the purchase of certain residential real estate. The contract provided an initial cash earnest money deposit of $1,000 and an additional earnest money deposit of “cash, stocks, bonds or securities, which shall be replaced by all cash at close”. The additional deposit was to be in the amount of $24,500. After execution of the contract, defendant proposed that the additional deposit be made in the form of a $24,500 letter of credit. Plaintiff approved the letter of credit and it was posted by deposit with the plaintiffs real estate broker, Jean Keene.
After the letter of credit was posted as the additional deposit, defendant Roger Francis proposed to the plaintiff, through his broker, Keene, that the letter of credit be released and that U.S. treasury bonds be substituted in place of the letter of credit as earnest money. Roger Francis bought four zero coupon bond coupons from a securities broker for less than $5,000. He forwarded these coupons to Mrs. Keene with full knowledge of the value of the coupons. He carefully stated in the transmittal letter that the coupons which he referred to as bonds had a face value of $28,000 at maturity. Maturity was November 15, 2005. He obviously knew exactly what he was doing. But for this disclosure, he would have been guilty of fraud. Roger Francis knew Mrs. Keene. Mrs. Keene knew Roger Francis to be from a good family and of prior good reputation. She had no idea Roger Francis was out to put one over on her. Mrs. Keene being a totally honest person at once admitted that she knew nothing about bonds or their value. She contacted her co-broker and asked the co-broker to verify the value. The co-broker, Mrs. Healey, called a securities broker and told him by telephone that she had “bonds” with a face value of $28,-000. She did not understand the difference between bonds and bond coupons. This tax exempt bond series with interest at 14% were worth a premium on the date in question. That is what the broker quoted. Had the securities broker seen the coupons or been told he was pricing coupons, he at once would have known that today’s value was only a fraction of the face value at maturity years hence. The gambit worked. The real estate brokers on behalf of their principal approved the exchange of the coupons worth less than $5,000 for the letter of credit worth $24,500.
Mr. Francis testified that he expected the brokers would have the coupons valued. The court does not believe him. The truth is not in Roger Francis. He expected what actually happened to happen. His testimony that he believed the brokers would price the coupons at less that $5,000 and would then approve the substitution of $5,000 in *29collateral for $24,500 in collateral can not be believed.
The seller’s broker, Mrs. Keene, did not rely on any representation of Mr. Francis, but attempted to have the value of the coupons verified. She relied upon a co-broker, Stephanie Healey, to verify the value of the coupons. Mrs. Healey made a mistake in verifying their value. Because of that mistake, both Stephanie Healey and Mrs. Keene assumed that the coupons had a value in excess of $32,000. The plaintiff McKinley, relying on the verification of value by the brokers, approved the substitution and agreed to the release of the letter of credit.
After the substitution of the coupons as additional deposit, defendant breached the contract and failed to close. Thereafter, the seller discovered that the coupons were worth substantially less than he had assumed.
Although the contract itself provided for substitution of property as additional deposit which had a fluctuating value, it is clear that Roger Francis engaged in a course of conduct involving sharp dealing and overreaching.
Defendant Roger Francis took advantage of the relative lack of sophistication of the seller and his real estate brokers regarding their knowledge of securities. Defendant Francis further tried to take advantage of the seller and his brokers by creating the impression that the coupons were worth at least as much as the letter of credit. Mr. Francis chose to exchange his good reputation for one successful flim flam. He was clever enough to make sufficient disclosure of the value of the collateral to avoid a finding of fraud in this court. Sherban v. Richardson, 445 So.2d 1147, 1148 (Fla.Dist.Ct.App.1984); Baker v. City of Orlando, 427 So.2d 1130 (Fla.Dist.Ct.App.1983).
CONCLUSIONS OF LAW
Defendant Francis was dealing at arms length with McKinley. The rules of the business marketplace apply. Defendant Francis, through his sly disclosure of the value of the treasury coupons avoided a finding of fraud. Though plaintiff has failed to carry his burden of proving fraud, the fabric of the local business community is stained with the slime of Mr. Francis’s reputation. The court must find in favor of the defendant Roger Francis and against the plaintiff John McKinley. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490704/ | ORDER DETERMINING PROCEEDING TO BE NON-CORE MATTER AND REQUIRING AMENDMENTS OF THE PLEADINGS
PEDER K. ECKER, Bankruptcy Judge.
This matter is before the Court on the plaintiff-debtors’ complaint to determine the ownership of a 1972 Astra Guerdon mobile home, Serial Number 1756. In their prayer for relief, the plaintiffs requested that the Court declare the ownership interest of the defendants in the home null and not enforceable, and declare the plaintiffs the true and proper owners of the home. They also asked that the Court order the defendants to sign and deliver the certificate of title for the home to the plaintiffs.
The defendants answered and alleged that the matter was res judicata and failed to state a claim upon which relief could be granted. In addition, the defendants counterclaimed for the return and recovery of the home, for damages or rent during the plaintiffs’ occupancy, and for attorney’s fees and costs.
The plaintiffs answered the counterclaim by a general denial and claimed a homestead in the mobile home. They requested dismissal of the counterclaim and delivery of the certificate of title. Both parties subsequently filed motions for summary judgment.
On June 20, 1988, in Rapid City, South Dakota, this Court denied both motions for summary judgment and proceeded with a trial in the matter. The Court heard the testimony of the parties and received other *1022evidence. At the end of the trial, the Court took the matter under advisement and requested briefs from the parties. All briefs have been received and the Court is ready to make a decision on the merits of the case.
Before the Court can proceed to a determination of this case on the merits, however, it must determine whether the proceeding is core or non-core. The bankruptcy court, on its motion or on a motion of a party, must determine whether a proceeding is a core proceeding or is a proceeding “otherwise related” to a case under Title 11. 28 U.S.C. § 157(b)(3). This determination is crucial because the bankruptcy judge may exercise full judicial power over only those controversies that are at the core of the federal bankruptcy power. See Matter of Wood, 825 F.2d 90, 96 (5th Cir.1987), quoting Northern Pipeline Constr. Co. v. Marathon Pipeline Co., 458 U.S. 50, 71, 102 S.Ct. 2858, 2871, 78 L.Ed.2d 598 (1982). On the other hand, a bankruptcy judge has limited power to hear “otherwise related” proceedings, which are those controversies based on state-created private rights and that do not depend on the federal bankruptcy laws for their existence. See Wood, 825 F.2d at 95-96, quoting Marathon, 458 U.S. at 71, 102 S.Ct. at 2871-72. These “otherwise related” matters could proceed in another court in the absence of bankruptcy. See Wood, 825 F.2d at 96, citing Marathon, 458 U.S. at 72 n. 26, 102 S.Ct. at 2872 n. 26.
The Court concludes that this adversary proceeding is a non-core matter. The plaintiffs’ request for a declaratory judgment of the parties’ ownership interests arises solely under state substantive law. The action could have been brought in state court. It is only before the Bankruptcy Court now because one of the parties is a debtor in bankruptcy. For these same reasons, the defendants’ counterclaim for the return of the mobile home and damages or rent is a non-core matter.
The complaint mistakenly characterized this adversary as a core proceeding. The answer incorrectly admitted this allegation. The counterclaim and the plaintiffs’ reply to the counterclaim made no jurisdictional allegations. None of the pleadings contained a statement concerning the parties’ consent to the entry of a final order or judgment by the bankruptcy judge. Pursuant to the new Supreme Court Bankruptcy Rules, effective August 1, 1987, an adversarial complaint or counterclaim shall contain a statement that the proceeding is core or non-core and, if non-core, that the pleader does or does not consent to entry of final orders or judgment by the bankruptcy judge. Bankr.R.P. 7008(a). Responsive pleadings must admit or deny the allegation that the proceeding is core or non-core. Bankr.R.P. 7012(b). If the response is that the proceeding is non-core, it shall include a statement that the party does or does not consent to entry of final orders or judgment by the bankruptcy judge. Id. In non-core proceedings, final orders and judgments must not be entered on the bankruptcy judge’s order except with the express consent of the parties. Id. (emphasis added). In the matter at issue, the pleadings either have incorrectly characterized the placement of jurisdiction or have failed to characterize the jurisdiction at all, and have failed to include the required statement concerning consent to entry of a final order or judgment.
Based on this Court’s determination that the pleadings are defective and do not comply with the Bankruptcy Rules, it is hereby
1. ORDERED that the plaintiff-debtors will amend their complaint to strike the allegation that the proceeding is a core proceeding and shall further amend the complaint to state whether they consent, or do not consent, to entry of a final order or judgment by the bankruptcy judge; that this amendment shall be accomplished within ten (10) days of entry of this order;
2. ORDERED that the plaintiff-debtors will amend their reply to the counterclaim to add an allegation that the proceeding is a non-core proceeding and shall further amend their reply to state whether they consent, or do not consent, to entry of a final order or judgment by the bankruptcy judge; this amendment shall be accom*1023plished within ten (10) days of entry of this order;
3. ORDERED that the defendants will amend their answer to strike the admission that the proceeding is a core proceeding and shall further amend their answer to state whether they consent, or do not consent, to entry of a final order or judgment by the bankruptcy judge; this amendment shall be accomplished within ten (10) days of entry of this order;
4. ORDERED that the defendants will amend their counterclaim to state that the proceeding is a non-core matter and shall further amend their counterclaim to state whether they consent, or do not consent, to entry of a final order or judgment by the bankruptcy judge; this amendment shall be accomplished within ten (10) days of entry of this order; and
5.ORDERED that if both parties consent to the entry of a final order or judgment by the bankruptcy judge, then this Court will enter such a final order or judgment; if either party does not consent to entry of a final order or judgment by the bankruptcy judge, then this Court will follow the procedure as outlined in Bankr.R.P. 9033. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490706/ | BENCH DECISION REGARDING
DOCKET #’s 441 and 448
HELEN S. BALICK, Bankruptcy Judge.
The issue before the court is whether a proposed settlement on an objection to a proof of claim should be approved. Century objected to the claim of Latham Four on the ground that its claim exceeded the dollar amount permitted under 11 U.S.C. § 502(b)(6). Century and Latham have reached an agreement which reduces the amount of Latham’s claim from $142,623.84 to $38,957.38. They further agreed that Latham is not entitled to vote an amount in excess of its amended claim with respect to Century’s plan of reorganization. FAB, another creditor, objects to the latter portion of the proposed settlement. FAB does not dispute that Latham’s claim as originally filed exceeded that which is permitted by statute and that the stipulated settlement corrects that problem. The gist of its ar*46gument is that it is now too late for a change in Latham’s previous vote rejecting the plan as a creditor holding an allowed claim of $142,623.84.
Latham’s claim to which Century filed its objection on February 5, 1988, had been filed on January 21, 1986. In the interim period, the debtor’s disclosure statement was approved and the debtor mailed its first amended plan with ballots to its creditors. January 26, 1987 was established as the time within which creditors could cast their vote accepting or rejecting that plan. FAB and the debtor each solicited Latham for its vote. In response to FAB’s solicitation, Latham cast a rejection ballot.
Confirmation hearing originally scheduled for January 1987 has not been rescheduled because of litigation following a series of motions Century filed to invalidate rejection ballots of four creditors, including Latham, and to seek sanctions against FAB for alleged improper solicitation. Latham’s vote was invalidated at the bankruptcy level and reinstated by the District Court. The question of its validity is presently before the Circuit Court of Appeals. During pendency of that appeal, the parties have sought rulings which this court believes impinges upon the matters on appeal and consequently has refused to rule.
The issue raised by the objection to the stipulated settlement is related to voting but does not bear on whether the vote should be counted or not. The question is whether the vote should be counted at $142,623.84 or $38,957.38 if FAB is successful at the Circuit level. If FAB is unsuccessful, the question is moot.
At the time Latham filed its ballot rejecting the plan, its claim was deemed allowed at $142,623.84 under 11 U.S.C. § 502(a). As the holder of such claim, it had the right to vote that amount under § 1126(a) for the purpose of it being counted under subsection (c). Century attacked that vote under subsection (e) on the theory that the vote was improperly solicited. It did not object to Latham’s claim under Bankruptcy Rule 3007 until after the District Court had ruled the vote was valid.
Neither the Code or Rules establish a deadline for objecting to a creditor’s claim nor does FAB contend that an objection cannot be successfully made subsequent to the close of balloting to establish for distribution purposes an amount different from that claimed.
FAB does contend that any change in a vote count is prohibited because at the time of the vote Latham voted a deemed allowed claim and Bankruptcy Rule 3018 mandates that any change or withdrawal of an acceptance or rejection can be made only upon notice and hearing within the time fixed for such acceptance or rejection of the plan.
Bankruptcy Rule 3018 was designed to give all creditors, even those holding disputed claims, the opportunity to vote and provided the means of accomplishing this. The prohibition against change or withdrawal of acceptance or rejection within the time fixed for acceptance or rejection and only for cause, following notice and hearing, is for the expeditious resolution of any question as to why the change. It is intended to protect all interested parties from the effect of any improper acts taken by anyone to influence another creditor to change a filed vote from acceptance to rejection or vice versa or to withdraw a vote.
It does not follow that Bankruptcy Rule 3018 prohibits the change in the weight of a vote subsequent to the close of voting when as a result of a sustained objection or an agreement, the claim as originally voted is found to be contrary to specific limiting provisions of the Code because of the nature of the claim, that is a landlord’s claim for damages, and not merely a dispute as to an amount due on an open account. A vote is not sacrosanct simply because the voting period has closed.
This conclusion is supported by analogy to § 1126(e) which permits, for cause, an attack against a vote subsequent to the close of voting. Moreover, § 502(j) authorizes the reconsideration, for cause, of the allowance or disallowance of a claim.
*47Upon reconsideration its allowance or disal-lowance should be in accordance with the equities of the case. The purpose of § 502(b)(6) is to limit a landlord’s claim to compensate for loss but to prevent a claim so large as to be a detriment to the other unsecured creditors. That detriment might be something other than a dollar distribution such as here where it may have a bearing on a class accepting or rejecting a plan. The effect of a reduction in the dollar amount has not been voiced by the parties nor does the court know what effect such a reduction will work. Furthermore, that result is not relevant to the issue presently before the court which is whether the settlement as presented should be approved or disapproved.
The settlement does not change the vote; it reduces the value of the vote to that amount which Latham may claim as damages under a specific limiting provision of the Code. Under these specific facts and circumstances, the proposed settlement is fair and equitable. FAB’s objection is dismissed. The so ordered clause on the settlement stipulation will be signed today. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490707/ | FINDING AS TO APPLICATION FOR AWARD OF ATTORNEY FEES
HAROLD F. WHITE, Bankruptcy Judge.
This matter comes before the court upon the Application for Award of Attorney Fees against Bank One of Cleveland, N.A. and Bank One of Akron, N.A., under 11 U.S.C. § 362(h), filed on April 6, 1988 by Mack D. Cook, II, attorney for the debtor in the matter of the Motion for Relief from the Automatic Stay filed by Bank One of Cleveland, N.A. and Bank One of Akron, N.A. (hereinafter referred to as “Banks”) on September 26, 1985. The matter was set for hearing with notice given to all interested parties. The Banks filed a Memorandum ... in Opposition to Application for Award of Attorney Fees on May 10, 1988.
At the hearing on May 20, 1988, the following were present: Mack D. Cook, II; Morris H. Laatsch, attorney for the debtor *132for all other bankruptcy matters; and Roger J. Stevenson, attorney for the Banks.
FINDINGS OF FACT
1. The debtor, Edward Albert Turner, Jr., filed a chapter 13 proceeding on May 1, 1984 and Bank One of Akron and Bank One of Ravenna were duly scheduled as unsecured creditors.
2. Bank One of Akron, aka Bank One of Ravenna, filed four proofs of claim on July 31, 1984 through its attorney, Ronald N. Towne.
3. This court confirmed the debtor’s chapter 13 Plan on January 18, 1985.
4. On August 12,1985 the Banks filed a complaint for civil RICO claims, Case No. C85-2266A, in the United States District Court, Northern District of Ohio, against fifteen or more defendants including the debtor. The Banks were represented by Richard E. Guster and Douglas L. Talley, of the law firm of Roetzel & Andress.
5. On September 9, 1985 the debtor, through attorney Cook, filed a motion to dismiss in the United States District Court pursuant to the automatic stay provision, 11 U.S.C. § 362(a)(1). The United States District Court withheld ruling on the motion pending this court’s determination of whether relief from stay should be granted and no further action was taken in the RICO case.
6. Subsequently, the Banks filed a Motion for Relief from Stay pursuant to 11 U.S.C. § 362(d) on September 26, 1985. In paragraph (6)(c) of the Motion, the Banks stated that:
Upon obtaining the requested relief from the automatic stay Movants would stipulate that they would not seek payment of any judgment entered in their favor against the debtor except: 1) from any entity other than the debtor which might also be liable for such judgment; and/or 2) by filing and prosecuting a proof of claim in this proceeding under 11 U.S.C. Section 501 et seq.; and/or from the debtor upon the entry of an order of this court denying the debtor a discharge or determining such judgment to be a non-dischargeable debt.
7. The Motion for relief from stay was heard on October 23, 1985 with a final hearing held on November 4, 1985. Both the Banks and the debtor filed Memorandums in Support.
8. On November 13, 1985 this court entered its Order granting relief from stay pursuant to the Finding of the same date, 55 B.R. 498. The Order for relief was granted “for the sole purpose of obtaining a finding of the debtor’s liability” and the Banks were “enjoined and prohibited from attempting to collect, recover, or offset any such debt as a personal liability of the debtor, or from property of the debtor.”
9. The request for attorney fees by Mack D. Cook, II is for the period September 27, 1985 to April 5, 1988 inclusive.
10. On May 6, 1988 the debtor was granted his discharge pursuant to 11 U.S.C. § 1328(a).
ISSUE
Is a creditor who violates the automatic stay of 11 U.S.C. § 362 and subsequently moves for relief from stay liable for attorney’s fees incurred as a result of said motion for relief from stay which was granted by the bankruptcy court?
CONCLUSIONS OF LAW
Section 362 of the Bankruptcy Code provides generally for the automatic stay of any and all proceedings against a debtor once a bankruptcy petition is filed. The consequences of violating the automatic stay provision are set forth in section 362(h) which provides that: “[a]n individual injured by any willful violation of a stay provided by this section shall recover actual damages, including costs and attorneys’ fees, and, in appropriate circumstances, may recover punitive damages.” This section, applicable to cases filed after October 7, 1984, was added by the Bankruptcy Amendments and Federal Judgeship Act of 1984 to specify the sanctions to be imposed against a party found to be in willful violation of a stay under 11 U.S.C. § 362. Prior *133to the enactment of section 362(h), courts found those willfully violating the automatic stay provision to be in contempt and thus imposed sanctions. See In re Taco Ed's, Inc., 63 B.R. 913 (Bankr.N.D.Ohio 1986); In the Matter of Crum, 55 B.R. 455 (Bankr.M.D.Fla.1985). Therefore, the court need not determine this issue on the basis of the applicability of section 362(h).
The evidence before the court is that the Banks knew of the debtor’s bankruptcy. The Banks were listed in the petition as unsecured creditors and further, the Banks filed four proofs of claim in June, 1984. The fact that two different counsels were utilized for the two matters, i.e. Attorney Towne for the bankruptcy and Attorneys Guster and Talley for the RICO matter, is irrelevant as the Banks are the parties charged with the knowledge of the bankruptcy. Notwithstanding such knowledge, the Banks intentionally filed a civil complaint in the United States District Court claiming RICO violations by the debtor and others. Upon the Banks’ realization that they violated the automatic stay, they promptly filed their Motion for Relief from Stay in this court on September 26, 1985.
Any injury to the debtor as a result of the Banks’ willful violation of the stay would have had to occur from August 12, 1985, the date of the filing of the RICO complaint, and September 9, 1985, at which time the debtor filed his motion to dismiss same and the United States District Court withheld ruling on the motion to dismiss and took no further action pending this court’s decision on the relief from stay issue. No injury was claimed by the debt- or nor was a request for attorney’s fees made for said time period. The claim for attorney fees as filed by Mack D. Cook, II was for the time period September 27, 1985 through April 5, 1988.
The Banks filed their Motion pursuant to 11 U.S.C. § 362(d) and the debtor opposed and/or defended said Motion. The Banks’ Motion for Relief, from Stay was granted. See Finding of Fact No. 8. The application for award of attorney’s fees pertains to the opposition and/or defense of said Motion. No authority exists for awarding damages and/or attorney’s fees as a result of the filing of a motion for relief from stay. An award of damages and/or attorney’s fees is required, pursuant to section 362(h), where a willful violation of the automatic stay occurs and the debtor is injured. In this case, the debtor’s counsel claims the debtor was injured in that he had to pay an attorney to oppose the Banks’ Motion. Any injury caused by the Banks’ willful violation of 11 U.S.C. § 362(a) had to occur prior to the filing of the Banks’ Motion. The injury to the debtor could not occur afterward.
For the foregoing reasons, the Application for Award of Attorney’s Fees should be denied. A separate order in accordance with this Finding shall be entered. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490708/ | MEMORANDUM OP OPINION AND ORDER
RANDOLPH BAXTER, Bankruptcy Judge.
This matter is before the Court upon the Complaint of Richard A. Baumgart, Trustee in Bankruptcy (Trustee), to recover a postpetition transfer and to recover preferences from the Defendant National City Bank (NCB). To resolve this adversary proceeding, the parties have submitted the matter on their respective briefs.1 Pursuant to Rule 7052, Bankr.Rules, the following constitutes the Court’s findings and conclusions:
I.
This adversary constitutes a core proceeding under provisions of 28 U.S.C. § 157(b)(2)(E), (F) and (O), with jurisdiction further conferred under provisions of 28 U.S.C. 1334, 11 U.S.C. §§ 549, 551 and General Order No. 84 of this District. The dispositive facts are generally undisputed. On September 27, 1984, Wright Airlines, Inc. (Debtor) caused to be filed its voluntary petition seeking an order of relief under Chapter 11. Subsequently, on July 12, 1985, the case was converted to one under Chapter 7. Preconversion, the Debtor was engaged in an airline service business, flying both scheduled and chartered flights. *147Additionally, the Debtor conducted business as a fixed based operator, providing general aircraft service and maintenance. Within the time-frame pertinent to this adversary proceeding, the Debtor’s remaining aircraft inventory consisted of two Convair aircraft which were owned by the Debtor subject to a security interest held by the Defendant, NCB. Following a default in payments, the Debtor filed its complaint to sell the aircraft pursuant to § 363 of the Code [11 U.S.C. § 363], upon which judgment was granted for the Debtor allowing the sale. Confirmation of the sale resulted in the aircraft being sold to Holland Industries, Inc. (Holland) for a purchase price of $1,300,000.00. The terms of the sale, inter alia, required Holland to assume the Debt- or’s outstanding indebtedness to NCB which totalled $1,225,000.00, in addition to the execution of a promissory note in an amount of $75,000.00 in favor of the Debt- or.
Subsequent to that aircraft sale to Holland, one of the Debtor’s creditors filed a motion to convert the case to one under Chapter 7. Prior to the Court’s ruling on that motion, the Debtor filed a motion seeking authority to enter into a lease with Holland to effect a lease back of the same two aircraft it had earlier sold to Holland. Without ruling on the latter motion, the Court entered its order converting the case to Chapter 7 on July 12, 1985. On that conversion date, the Debtor caused to be issued its check in an amount of $55,000.00 payable to NCB to, purportedly, satisfy its rental obligation to Holland and, in turn, apply to Holland’s attendant debt to NCB. Following that transfer, this adversary proceeding ensued.
II.
The dispositive issues are two-fold: (1) Whether the $55,000.00 transfer to NCB by the Debtor was made within the ordinary course of business; and (2) Whether the $55,000.00 transfer occurred prior to the case being converted to Chapter 7 or po-steonversion. In addressing these issues the Plaintiff-Trustee contends that (1) the transfer sought to be avoided was not made in the ordinary course of business and (2) if the transfer is determined to have been made postconversion, it becomes irrelevant whether the transfer was made in the ordinary course of business and the Trustee is entitled to judgment as a matter of law. The Defendant NCB, contends that (1) the Debtor’s post-sale use of the subject aircraft gave rise to an administrative expense owed by the Debtor to Holland; (2) Such expense occurred within the ordinary course of the Debtor’s business and. outside the purview of § 549(a) of the Code; (3) As Holland’s secured party, it (NCB) was entitled to collect on Holland’s administrative claim against the Debtor; and (4) Allowing the Debtor to use the aircraft without compensating Holland therefor would be prejudicial to NCB and would further constitute an unjust enrichment to the Debtor’s estate.
III.
Section 549 of the Bankruptcy Code [11 U.S.C. § 549], provides in relevant part the following language:
§ 549. Postpetition transactions.
(a) Except as provided in subsection (b) or (c) of this section, the trustee may avoid a transfer of property of the estate—
(1) [that] occurs after the commencement of the case; and
(2)(B) that is not authorized under this title or by the court. 11 U.S.C. 549(a)(1), (2)(B).
Section 503 of the Code, [11 U.S.C. § 503] provides in pertinent part:
§ 503. Allowance of administrative expenses.
(a) An entity may file a request for payment of an administrative expense.
(b) After notice and a hearing, there shall be allowed administrative expenses, other than claims allowed under section 502(f) of this title, including
An examination of the docket, relevant pleadings, and representations of counsel clearly indicates that the transfer of $55,000.00 was made by the Debtor to NCB postpetition. See, Stipulations, para. 8. Contrary to the complaint allegations, *148NCB contends that the $55,000.00 constituted an administrative expense incurred by the Debtor’s estate pursuant to § 503(b)(1)(A). Such a contention is without merit. Firstly, as indicated above, an administrative expense is allowable only upon request to the Court. 11 U.S.C. § 503(a). In this situation, the record is silent to reflect where any party to this adversary has requested such an allowance. 11 U.S.C. § 503(a). Secondly, if requested, the allowance would be granted only after notice and hearing as prescribed by § 503(b). In re Dakota Industries, 31 B.R. 23, 10 B.C.D. 1115 (D.S.Dak.1983). Herein, there was no notice to that effect and no hearing was held.
Furthermore, as of the time the transfer was made, there existed no privity between the Debtor and NCB. Although the Debtor previously was indebted to NCB as a secured creditor for its acquisition of the two Convair aircraft, that relationship terminated in the sales transaction wherein the Debtor sold the aircraft to Holland and NCB released its claim against the Debtor. See, Order dated May 20, 1985; Stipulations, para. 7. There is no docket entry to reflect that either NCB or Holland filed a request for an administrative expense. Thusly, none is allowable, and NCB has further failed to prove where it incurred any actual and necessary costs which were beneficial to the Debtor’s estate postpetition to warrant an administrative expense allowance.2 Therefore, the $55,000.00 transfer of estate assets made by the Debt- or to NCB on July 12,1985, does not constitute an allowable administrative expense, but does conform with an avoidable post-petition transfer proscribed under § 549 of the Code.
NCB’s contention that the subject transfer occurred within the ordinary course of the Debtor’s business is, likewise, without merit. As stated above, NCB had released its claim and security interest against the Debtor as part of the aircraft sales transaction between the Debtor and Holland. In that transaction, NCB received new liens from Holland. Thusly, there was no privity or course of dealings between the debtor and NCB to support an ordinary course of business defense to the complaint allegation. Further, NCB’s contention that it is an assignee of an administrative claim held by Holland is unsubstantiated. As held above, Holland never filed a request for an administrative claim in the case and no such request was approved. Therefore, NCB could not be an assignee of a claim which never existed, and there otherwise is no evidence of a claim transferred pursuant to provisions of Rule 3001(e), Bankr.R. Additionally, by stipulation, the parties hereto acknowledged that the $55,000.00 payment was made by the Debtor to NCB at the request of Holland, purportedly for the Debtor’s use of the two aircraft. See, Stipulations, para. 8. Yet, it was further stipulated that no written lease was ever executed between the Debtor and Holland respecting the use of the aircraft, although an unapproved motion was filed to execute such a lease prior to the case being converted to Chapter 7. The Debtor’s precon-version motion to enter into a lease with Holland further evidences the fact that the transaction regarding the aircraft was beyond the ordinary scope of business, requiring due notice and court appproval. 11 U.S.C. 363(b)(1). Pursuant to Rule 6001, Bankr.R., the burden of proof as to the validity of a postpetition transfer is on the entity asserting the validity of the transfer. At bar, that entity is the transferee, NCB. For the reasons stated herein, that burden has not been met. Thusly, there existed no allowed administrative expense and no lease obligation authorized by the Court. Unless the Court authorizes it or the Code otherwise excuses the need for Court approval, an estate has no implied obligation. NCB’s averments respecting unjust enrichment is without merit.
Having determined that the subject transaction was outside the scope of the Debtor’s ordinary course of business, and rejecting NCB’s argument for an adminis*149trative expense, an addressment of the second issue is unnecessary.
Accordingly, the Debtor’s postpetition transfer of $55,000.00 to NCB is void pursuant to § 549, and same is to be returned forthwith to the Debtor’s estate. Further, NCB’s motion for summary judgment is denied. Judgment is rendered for the Plaintiff Trustee.
IT IS SO ORDERED.
. By stipulation, the parties agree that none of the payments made by the Debtor to NCB within the 90-day period prepetition were preferential transfers avoidable under § 547 of the Bankruptcy Code.
. The several cases cited in support of NCB's position consistently indicate that the administrative expenses involved were "allowed,” unlike the situation at bar where no such request had been made or allowed. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490709/ | ORDER DENYING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT
BARBARA J. SELLERS, Bankruptcy Judge.
Gasearch, Inc., Steven R. Yrable and Robert J. Schuster, (collectively “Defendants”), jointly filed a motion seeking summary judgment in this adversary proceeding. Plaintiff Larry E. Staats, trustee for the bankruptcy estate of Sheldon L. Turrill (“Trustee”), opposed that motion. For reasons stated below, the Court finds that Defendants’ motion should be denied.
The Court has jurisdiction in this proceeding under 28 U.S.C. § 1334(b) and the General Order of Reference entered in this district. This matter is either a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(E) and (0) or is a non-core proceeding in which the parties have consented to judgment by the Bankruptcy Judge.
The Trustee seeks a judgment declaring the rights of the bankruptcy estate in certain shares of stock in Gasearch, Inc. and an accounting of proceeds from the sale of Gasearch, Inc.’s assets. The Trustee further asserts causes of action for conversion and unjust enrichment against Vrabel and Schuster.
Rule 56 of the Federal Rules of Civil Procedure, applicable to this adversary proceeding by Bankruptcy Rule 7056, provides that judgment shall be granted on a motion for summary judgment only “if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” See Lenz v. Erdmann Corp., 773 F.2d 62, 63 (6th Cir. 1985). The purpose for permitting disposition of certain actions on the basis of summary judgment is to eliminate the need for an evidentiary trial if it is clear from documents and affidavits before the Court that the only issues for decision are the legal effects of uncontested facts.
The Court’s review of the pleadings in this action, including the Defendants’ motion and the Trustee's memorandum in opposition, along with transcripts of associated depositions, indicate that this is not an appropriate action for disposition by summary judgment. The issues involve determinations of the appropriateness and validity of certain alleged corporate acts affecting the share interests of Sheldon Turrill in Gasearch, Inc., including the nature and extent of consideration given for the shares. Those determinations require examination of the receipt and content of certain notices to various parties and understandings among the parties. There are factual disputes relating to those notices and understandings, and credibility of the witnesses appears to be a significant factor.
The Defendants have also pled a defense of laches. Establishment of that defense may depend upon facts relating to the content of communications, many of which are disputed.
In addition, the Defendants assert that a statute of limitations bars action by the Trustee for recognition of any shareholder interest of the bankruptcy estate in Ga-search, Inc. in excess of 4%. The applicability of the statute of limitations relied *174upon by the Defendants, however, turns on the validity of certain options to acquire stock which the Trustee argues were granted and exercised, if at all, in violation of Turrill’s pre-emptive rights. Contested facts underlie resolution of that issue, and it would be inappropriate to decide that matter on the basis of the documents presently before the Court without opportunity to evaluate the credibility of witnesses or to consider testimony resulting from the use of cross-examination in a trial setting.
In conclusion, the Court finds that this action is not ripe for resolution on the merits at this stage on a motion for summary judgment. Accordingly, the Defendants’ motion for summary judgment should be, and the same is, hereby DENIED. This adversary shall proceed to trial as previously set for July 18,1988 at 9:30 a.m.
IT IS SO ORDERED. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490710/ | MEMORANDUM DECISION AND ORDER RE: OBJECTION TO EXEMPTION
JON J. CHINEN, Bankruptcy'Judge.
On April 19, 1988, Richard M. Kennedy, Trustee of the Estate of David T. Eith, and Edward J. Stanley, Trustee of the Estates of David T. Eith, dba Industrial Medical Clinic, Airport Medical Service, Inc. and Pawaa Medical Laboratory, Inc. (both being hereafter jointly referred to as “Trustees”), filed Trustees’ Objection to Debtor’s Claim of Exemption, wherein they moved this Court for an Order denying exemption of certain books claimed by David T. Eith, M.D., (“Debtor”). A hearing was held on May 24, 1988 at which hearing Jerrold Gu-ben, Esq., represented the Trustees, and Wesley H. Ikeda, Esq., represented Debtor. Following arguments of counsel, the Court took the matter under advisement. Based upon the memoranda submitted, the records in the file, arguments of counsel and, being fully advised in the premises, the Court renders this Memorandum Decision.
*280The Debtor filed his Chapter 7 petition on December 10, 1987, and thereafter filed his schedules which proposed to exempt from his estate a collection of certain books and written materials.
The Debtor claimed these books and written materials exempted pursuant to Section 651-121, H.R.S.
Section 651-121 provides in pertinent part:
§ 651-121 Certain personal property and insurance thereon, exempt. The following described personal property of an individual up to the value set forth shall be exempt from attachment and execution as follows:
(1) All necessary household furnishings and appliances, books and wearing apparel, ordinarily and reasonably necessary to, and personally used by a debtor or the debtor’s family residing with the debtor; and, in addition thereto, jewelry, watches, and items of personal adornment up to an agrégate cash value not exceeding $1,000.
The Trustees object to the Debtor’s claim of exemption for certain of the books listed in Exhibit A attached to their objection on the ground that said books were and are not “necessary” and not “ordinarily and reasonably necessary to, and personally used by a debtor or the debtors’ family residing with the debtor ...” The Trustees assert that certain of the books were and are held for collection and investment purposes and should be deemed property of the estate.
When a debtor files a petition under Chapter 7, all of his property becomes part of the estate. Thereafter, the debtor may claim certain property as being exempted, either under the federal Bankruptcy Code or the state statute. Though the exemption provision is . to be liberally construed, where there is an objection to a claimed exemption, the burden is on the debtor to prove that he is entitled to the claimed exemption.
In the instant case, the debtor had kept his books and written materials in boxes at his business office. These books and materials covered a variety of subjects, from easy, relaxing reading materials to highly technical materials, from adventure stories of Tarzan to many “collections”: Hawaiian collections, collection on Winston Churchill’s books; collection on Captain Cook’s Journals. Some were in French and some were books only for persons with special interest in the land system of Hawaii.
Debtor failed to present any testimony to show that he or his family members read these books and materials for pleasure or relaxation. It appears to this Court that some of the books, such as stories on Tarzan, are for pleasure. But, without evidence to the contrary, the Court finds the Hawaiian collection to be for investment purposes. Walnut Valley State Bank of El Dorado v. Coots, 60 B.R. 834 (D.Kan.1986), In re Reid, 757 F.2d 230 (10th Cir.1985). The Court authorizes the Trustee to contact an appraiser experienced in dealing with books to estimate the cost of valuing those books he believes are for investment purposes. After approval of the appraiser by the Court, the Trustee may engage the services of that appraiser. Thereafter, the Trustee may then file a motion to sell those collections with an opportunity for debtor to object. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490711/ | MEMORANDUM OPINION
ALBERT E. RADCLIFFE, Bankruptcy Consultant.
This matter comes before the court on plaintiffs and defendant, Southwestern Motors, Inc.’s (Southwestern’s) cross-motions for summary judgment. This is a preference action initiated by the trustee to avoid the defendants’ security interest in an automobile. The parties’ affidavits, exhibits and memoranda reveal the following undisputed facts:
1. On or before April 15, 1986, Daniel and Phyllis Thomas traded in a 1984 Dodge Aries automobile (the car) to Southwestern. At that time, the car was subject to a valid perfected security interest held by United States National Bank (USNB).
2. On April 15, 1986, Southwestern satisfied the security interest of USNB by paying to USNB the sum of $4,774.94 in *299order to be in a position to sell the car to a retail customer.
3.On June 21, 1986, Southwestern sold the car to the debtors under a retail installment sales contract which was subject to defendant, General Motors Acceptance Corporation’s (GMAC) approval. As part of the sale, the debtors traded in a 1979 Oldsmobile. The debtors took possession of the car this same date.
4. On June 24, 1986, GMAC approved the sale. Southwestern assigned the sales, contract to GMAC, with GMAC reserving a right of recourse in the event of the debtors’ default.
5. On June 27, 1986, Southwestern prepared its dealer’s package of title transactions for the week ending June 27, 1986.
6. In that package, among other things, was the title to the car which included an application for title transfer and written powers of attorney executed by the Thom-ases and the debtors. The package also included a check for $176 which represented title transfer fees for nine separate automobiles, including the car.
7. On either June 30 or July 1,1986, the package was delivered to the Department of Motor Vehicles (DMV). The $176 check was stamped July 1, 1986. The application for title transfer for the car was not stamped at that time. After receipt, Deena Rutledge, a DMV employee, examined the application regarding the car and noted that the application was not in proper form because the debtors’ power of attorney accompanying it related to the wrong vehicle, that is, it related to the Oldsmobile which the debtors had traded-in, rather than the car which they had purchased.
8. On July 2 or 3, 1986, Ms Rutledge contacted Southwestern by telephone and advised about the improper power of attorney. She returned the application to Southwestern.
9. On July 10, 1986, Southwestern submitted the correct power of attorney and the application was then processed in due course.
10. On July 31, 1986, the debtors filed their petition for relief herein under Chapter 7 of the Bankruptcy Code,
H- Plaintiff is the duly appointed and acting trustee herein,
12. The debtors defaulted on the purchase contract by failing to pay the monthly payment due in October, 1986. Upon default, the contract and security interest was reassigned by GMAC to Southwestern.
ISSUES
11 U.S.C. § 547 provides in pertinent part as follows:
(b) Except as provided in subsection (c) of this section, the trustee may avoid any transfer of an interest of the debtor in property-
(1) to or for the benefit of a creditor;
(2) for or on account of an antecedent debt owed by the debtor before such transfer was made;
(3) made while the debtor was insolvent;
(4) made-
(A)on or within 90 days before the date of the filing of the petition; ...
(5) that enables such creditor to receive more than such creditor would receive if-
(A) the case were a case under chapter 7 of this title;
(B) the transfer had not been made; and
(C) such creditor received payment of such debt to the extent provided by the provisions of this title.
(c) The trustee may not avoid under this section a transfer- ...
(3) that creates a security interest in property acquired by the debtor-
(A) to the extent such security interest secured new value that was-
(i) given at or after the signing of a security agreement that contains a description of such property as collateral;
(ii) given by or on behalf of the secured party under such agreement;
(iii) given to enable the debtor to acquire such property; and
*300(iv) in fact used by the debtor to acquire such property; and
(B) that is perfected on or before 10 days after the debtor receives possession of such property; ...
The plaintiff seeks to avoid the creation of any purchase money security interest in the car in favor of defendants on the basis that such security interest was created and perfected within 90 days prior to the filing of the petition herein as provided for in 11 U.S.C. § 547(b)(4)(A) but perfected more than 10 days after the debtor received possession of the car as allowed in 11 U.S.C. § 547(c)(3).
Southwestern argues that their security interest in the car was perfected when the application for transfer of title was originally received by the DMY on July 1, 1986, within the 10 days provided for in 11 U.S.C. § 547(c)(3), thus, the plaintiff may not avoid the creation and perfection of the security interest. In the alternative, Southwestern argues that even if its lien is avoidable, it should be subrogated to the security interest in the car formerly held by USNB which it paid. Finally, Southwestern urges that even if its motion for summary judgment is denied and it is not entitled to subrogation, that the plaintiff is still not entitled to summary judgment as the plaintiff has not pled nor proven one of the elements of its prima facie case, that Southwestern has received more than it would receive if the security interest had not been created and Southwestern shared in the distribution of this Chapter 7 estate. 11 U.S.C. § 547(b)(5).
DISCUSSION
The Oregon statute regarding perfection of security interests in vehicles as it existed prior to the amendment by the Oregon Legislature in 1987 1 is O.R.S. 803.095. The statute provides in pertinent part as follows:
(5) Except as provided in subsection (6) of this section (dealing with vehicles held as inventory, not applicable here) or ORS 820.510, (concerning mobile homes) the exclusive means of perfecting security interest in a vehicle issued a certificate of title by the division is by application for notation of the security interest on the certificate of title in accordance with this section. All of the following apply to the creation of the security interest:
(d) Except as provided in paragraph (e) of this subsection, a security interest that is perfected as described in this subsection is perfected as of the date the application is received by the division. In order to establish the date of perfection under this subsection, the division, at the time the division first processes an application for a security interest, shall mark upon the application the date the division first received the application either by mail or by presentation to any office of the division. Proof of the date of perfection may be provided as described under O.R.S. 802.240.
(e) The date the division receives an application to perfect a security interest as described in this subsection, does not establish the date that the security interest is perfected if the division determines that the application is not in proper form and so indicates upon the application in a manner showing the date placed on the application under paragraph (d) of this subsection is invalid. (Emphasis added) (parenthesis added)
Plaintiff argues that the DMV date stamp conclusively establishes the date of perfection. In the alternative, the application as originally submitted was not in proper form. Thus under O.R.S. 803.-095(5)(d) and (e), perfection arose when the application was resubmitted in proper form and stamped on July 10,1986, more than 10 days after the debtors received possession of the car. Southwestern argues that the application was initially in proper form and that the incorrect power of attorney was a non-material defect, as such, the application was sufficient and was received by the DMV on July 1, 1986, within 10 days from *301the date the debtors received possession of the car.
O.R.S. 803.095(5)(d) provides that the DMV shall date stamp every application it receives when it first receives it. Then, pursuant to O.R.S. 803.095(5)(e), after examining the application, if DMV determines that it is not in proper form, it is to mark on the application that the original date stamp is invalid.
Here, the DMV did not date stamp the application when it was originally received. Assuming, without deciding, that perfection can be proven by means other than a DMV date stamp, it is undisputed that DMV’s first receipt of the application was on July 1, 1986. Given this fact, DMV’s failure to stamp the initial application is harmless error.
DMV, however, reviewed the application and returned it because the power of attorney submitted by Southwestern was the one pertaining to the debtors’ trade-in, the 1979 Olds, rather than the car. The correct power of attorney was then provided and the corrected application was processed on July 10, 1986.
It appears from a plain reading of the statute that perfection took place on July 10, 1986. Ms Rutledge’s determination to return Southwestern's application was proper.
A vehicle owner’s signature is a material component of any application for transfer or creation of a security interest. O.R.S. 803.095(5)(a) provides in pertinent part as follows:
The owner of the vehicle ... shall sign and enter the date on the appropriate space on the back of the certificate of title ... and shall deliver the certificate to the person in whom the security interest is created....
Here, DMV could not have issued a certificate of title to the car indicating the defendants’ security interest thereon, without the signature of the debtors, either on the back of the certificate of title to the car or in a power of attorney referring to the car. The failure to include the proper power of attorney with the original application was a material defect.
This court finds that the security interest of the defendants was perfected more than 10 days after the debtors received possession of the car but within 90 days prior to the filing of the petition herein, thus, the security interest is avoidable by the trustee pursuant to 11 U.S.C. § 547.
Southwestern argues in the alternative, that even if its own lien fails, it is subrogated to USNB’s lien which it paid off in order to sell the car. Southwestern relies upon Clackamas County Bank v. Internal Revenue Service (In re Allen), 32 B.R. 93 (Bankr.D.Or.1983) for support. There, the court, in allowing a mortgagee priority over an intervening tax lien, reiterated long standing Oregon law on this issue, stating:
A person who advances money to discharge a prior lien on real or personal property and takes a new mortgage as security will be subrogated under Oregon law to the prior lien as against the holder of an intervening lien of which he was excusably ignorant. 32 Bankr. at 95.
The purpose of the rule is to prevent unjust enrichment and protect the mortgagee’s expectation that by paying off the prior lien it is getting clear title. The rule recognizes that the intervening lienor is not prejudiced because it is in exactly the same position it would have been in had the senior lien not been paid off.
Southwestern’s reliance upon Allen is misplaced. Here, there was no intervening lien when Southwestern paid off USNB. Southwestern got exactly what it paid for, clear title to the car which it later sold to debtors.
It follows that Southwestern’s motion for summary judgment should be denied.
As its final argument, Southwestern urges that summary judgment should not be granted to the plaintiff since the plaintiff has failed to plead and prove one of the prima facie elements of its case, namely, that the defendants have received more than they would have received under this case had the security interest not been *302untimely perfected as set forth in 11 U.S.C. § 547(b)(5).
The plaintiff has pled all necessary elements of its prima facie case. Plaintiff’s complaint alleges in pertinent part as follows:
7. The transfer of the security interest from the Debtors to the Defendant GMAC is avoidable by the Plaintiff, under and virtue of 11 U.S.C. § 547.
8. On information and belief, Plaintiff alleges that the security interest of Defendant GMAC in the above described motor vehicle has been reassigned under a recourse agreement to Defendant Southwestern Oregon Motors, Inc., after demand by Plaintiff was made on Defendant GMAC for release of its security interest by reason of the avoidability of the transfer to it by the Debtors. Defendant Southwestern Oregon Motors, ínc. retook said security interest from the Defendant GMAC with notice of the avoidability of the transfer to Defendant GMAC by the Debtors and not in good faith. Plaintiff's Complaint, ¶¶ 7 & 8, pg. 2, lines 19-26, pg. 3, lines 1-3.
The court notes, however, from reviewing the answers filed by both defendants, that this element of the plaintiffs case has been put at issue on the pleadings.
Plaintiff has the burden of proof to establish all of the elements of its prima facie case under 11 U.S.C. § 547(b). See 11 U.S. C. § 547(g). Accordingly, plaintiffs motion for summary judgment must be denied as this court finds that there is a material issue of fact as to whether or not the defendants received more, by way of the creation and perfection of their security interest in the car than they would have received by sharing as a general creditor in this estate as provided in 11 U.S.C. § 547(b)(5). An order consistent herewith shall be entered.
This opinion shall constitute the court’s findings of fact and conclusions of law under Federal Rule of Civil Procedure 52 as made applicable to this court by Bankruptcy Rule 7052; they shall not be separately stated.
ORDER DENYING MOTIONS FOR SUMMARY JUDGMENT
This matter having come before the court upon motions for summary judgment filed by plaintiff and by defendant, Southwestern Motors, Inc., the court having reviewed the memoranda and supporting documents submitted by the parties, the argument of counsel, having entered its opinion herein and being fully advised in the premises;
Now, therefore, IT IS HEREBY ORDERED that the motion for summary judgment filed by defendant, Southwestern Motors, Inc. be, and it hereby is denied; and it is
FURTHER ORDERED that the motion for summary judgment filed by plaintiff be, and it hereby is denied.
. The amendments became effective September 27, 1987. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490713/ | *404FINDINGS OF FACT, CONCLUSIONS OF LAW AND MEMORANDUM OPINION
ALEXANDER L. PASKAY, Chief Judge.
THIS IS a Chapter 7 liquidation ease and the matter under consideration is the dis-chargeability vel non of an obligation imposed on Dr. Michael J. Kinney (Dr. Kinney) in conjunction with a divorce proceeding by the Circuit Court of the County of Cabell of the State of West Virginia. The claim that the obligation is dischargeable is asserted by Dr. Kinney who instituted this adversary proceeding against Margaret Ann Kinney, his former wife, who is the named Defendant in this adversary proceeding. The facts as appear from the record and relevant to the character of the obligation in question involve a provision in the original final decree of divorce which was entered on December 29, 1981, which provided that Dr. Kinney was to pay and save Margaret Ann Kinney harmless on all outstanding obligations and debts incurred by the parties prior to the filing of the divorce action.
At the final evidentiary hearing, counsel for Dr. Kinney and Margaret Ann Kinney stipulated that the facts are without dispute and the issue can be resolved as a matter of law based on the documentary evidence which by agreement was admitted in evidence, which reveals the following facts:
Dr. Kinney and his former wife, Margaret Ann Kinney, were married on January 30, 1973. At the time of the divorce, the couple had two minor children, ages 5 and 7 respectively. On March 26, 1981, Margaret Ann Kinney filed an action for dissolution of the marriage in the Circuit Court of Cabell County, West Virginia and requested inter alia an award of alimony. On October 23, 1981, while the divorce proceeding was still pending Dr. Kinney filed his Voluntary Petition for Relief in this Court. Shortly thereafter, this Court having modified the automatic stay, authorized Margaret Ann Kinney to proceed and complete the divorce action. In turn, the same came to a conclusion by the entry of a final divorce decree by the Circuit Court on December 29, 1981. (Joint Exhibit # 1) The divorce decree dealt, inter alia, with the subject of custody and provided for child support, and a division of certain properties owned by Dr. Kinney and his former wife. Most importantly, the decree provided in the section of the decree dealing with property division in specific language that Dr. Kinney “shall pay and save the Plaintiff [Margaret Ann Kinney] harmless on all outstanding obligations and debts incurred by the parties prior to the filing of this action.” The final divorce decree specifically provided, however, that Margaret Ann Kinney was not entitled to any alimony. (Joint Exhibit # 1)
In due course Margaret Ann Kinney, having been aggrieved by the final decree, filed a notice of appeal. On appeal, Margaret Ann Kinney challenged the final decree in two respects, one of which related to the distribution of the properties and the second dealt with the trial court’s failure to award alimony. The Court of Appeals concluded in Kinney v. Kinney, 304 S.E.2d 870 (W.Va.Ct.App.1983) (Joint Exhibit # 2) that under the applicable state statute this was a no-fault divorce and, therefore, the trial court erred by concluding that since Dr. Kinney was without fault he should not be ordered to pay alimony. The Court of Appeals also found that since the trial court made no findings of fact pertaining to the factors which must be taken into consideration in making an alimony award under the laws of West Virginia, W.Va. Code, 48-2-16 (1969), the case should be remanded for further consideration by the lower court. Accordingly, the Court of Appeals remanded the action to the trial court with directions to determine an appropriate alimony award, if any, according to the statute just cited.
Pursuant to the order of remand, the trial court conducted an extensive hearing at which time counsel for the parties discussed not only the proper method to comply with the order of remand, but also the fact that Dr. Kinney was already involved in a bankruptcy proceeding and had obtained his discharge. It is clear from the *405transcript that the court in fashioning the remedy was persuaded to structure its ultimate order to assure that the obligation imposed on Dr. Kinney would not be a dischargeable obligation (Joint Exhibit No. 6). Moreover, it further appears from the transcript of the proceeding that while there was some evidence presented concerning Dr. Kinney’s financial conditions, there was nothing whatsoever presented as to Margaret Ann Kinney’s financial condition and her needs. However, it is clear that the order on Remand (Joint Exhibit # 7) provided in Paragraph 2 that Margaret Ann Kinney was awarded limited rehabilitative alimony in an amount necessary 1) to pay and save her harmless with regard to the indebtedness owed to Guaranty National Bank discussed below by virtue of her guaranty to completely indemnify her for attorney fees and court costs for an action which was already pending against her by the Guaranty National Bank, and 2) to completely indemnify her on other joint obligations incurred by the parties prior to the commencement of the divorce proceeding.
It appears that prior to the commencement of the divorce proceeding and while Dr. Kinney was still married, Margaret Ann Kinney co-signed several promissory notes in favor of Guaranty National Bank which guaranties were signed by her on behalf of Renal Care, Inc., and the Ne-phrology Foundation, Inc., two corporations which were solely owned by and operated by Dr. Kinney. It is without dispute and agreed by all that the only obligation which is really involved in this controversy is the obligation by Margaret Ann Kinney to Guaranty National Bank which was determined by virtue of a summary judgment entered on November 23, 1987, by the Circuit Court of Cabell County, West Virginia (Joint Exhibit # 8) to be as follows:
$ 35,000.00 Promissory Note
$ 5,800.00 Promissory Note
$ 85,000.00 Promissory Note
$100,000.00 Promissory Note
$225,800.00 TOTAL
To this total judgment was added interest in the respective amounts of $36,107.53, $6,335.51, $56,740.41 and $84,958.90 and post-judgment interest at the legal rate and costs.
It should be noted that Guaranty National Bank who sued Dr. Kinney and Margaret Ann Kinney also filed a complaint seeking a determination that the debts owing on the promissory notes by Dr. Kinney are nondischargeable obligations by virtue of § 523(a)(2)(A) and (B). The matter was tried in due course by this Court which held that the $35,000.00 note, the $5,800.00 note, and the $100,000.00 note represented monies obtained in violation of § 523(a)(2)(A) and (B), and, therefore, they were declared to be nondischargeable debts. However, the amount owing on the note in the amount of $85,000.00 was determined to be dischargeable. The Final Judgment was entered by this Court on October 11, 1985, and is currently pending an appeal prosecuted by Dr. Kinney.
Dr. Kinney having been aggrieved by the order on remand appealed this order and challenged the award of the rehabilitative alimony of December 20,1984, even though no order was actually entered, and apparently the appeal was based on a colloquy set forth in a transcript (Joint Exhibit No. 6). On January 22, 1986, the Supreme Court of Appeals of West Virginia “refused” (sic) the appeal.
There is nothing in this record which indicates whether or not Margaret Ann Kinney paid any of the judgment obtained by Guaranty National Bank against her and neither is there any evidence in this record as noted earlier as to her financial status either at the time the original final decree of divorce was entered or at the time the Circuit Court granted her “rehabilitative alimony” by providing that Dr. Kinney must hold her harmless on the judgment obtained by Guaranty National Bank.
These are the relevant and significant facts based on which it is the contention of Dr. Kinney that notwithstanding the label put on the hold harmless agreement by the order of the divorce court after remand entered on December 20, 1984, this provision is really in the nature of a property settlement and division of liabilities be*406tween the parties rather than an obligation imposed on him, truly in the nature of alimony or support. In support of this proposition, Dr. Kinney contends that this obligation does not carry any of the factors which, of course, have traditionally been considered to determine whether or not the obligation imposed on a spouse as a result of divorce is in fact alimony which would be nondischargeable, pursuant to § 523(a)(5) of the Bankruptcy Code or is actually a final property settlement which is dischargeable. See In re Bell, 47 B.R. 284 (Bkrtcy.E.D.N.Y.1985); In the Matter of Basile, 44 B.R. 221 (Bkrtcy.M.D.Fla.1984); In the Matter of Rachmiel, 19 B.R. 721 (Bkrtcy.M.D.Fla.1982); In the Matter of Newman, 15 B.R. 67 (Bkrtcy.M.D.Fla.1981) In this connection, Dr. Kinney points out that the obligation to hold Margaret Ann Kinney harmless does not cease upon her death or remarriage, a traditional hallmark of alimony provisions; that it was not based on any evidence which supported the disparate incomes of the parties; and that it had to be paid in lump sum and not in installments. There was no showing of evidence that Margaret Ann Kinney was in fact in need of support, and the Court which entered the divorce decree did not retain jurisdiction to reconsider this provision of the December 20 order. Of course, Dr. Kinney also points out correctly that the creditor bears the burden of proving that an obligation should be excepted from the Debtor’s discharge, In re Campbell, 74 B.R. 805 (Bkrtcy.M.D.Fla.1987) and the labels placed on a provision in a divorce decree by the state court are not controlling as to whether or not an obligation imposed on a spouse by a divorce decree is in fact alimony or support must be determined with reference to federal law. In re Hall, 51 B.R. 1002 (Bkrtcy.Ga.1985) The contentions of Dr. Kinney are supported by the legislative history notes of the Committee on the Judiciary, House Report, 95-595, U.S.Code Cong. & AdmimNews 1978, p. 5787, which indicates that debts which are based on an agreement by the Debtor to hold the Debtor’s spouse harmless on joint debts are nondischargeable only to the extent that the agreement was in fact in a provision for alimony or in the nature of actual support of the spouse. In resolving the matter under consideration it should be noted that the proposition urged by Margaret Ann Kinney that the provision was structured in a manner to prevent Dr. Kinney from escaping his responsibility to hold her harmless through the bankruptcy discharge is immaterial. This is so because the divorce decree under consideration was entered after Dr. Kinney filed his voluntary petition, which fact is clearly indicative that the divorce court intended to make the hold harmless provision to be in the nature of support for the specific purpose to remove the obligation from the overall protective provisions of the general bankruptcy discharge. Nevertheless, considering the facts that the originally filed decree entered in this divorce case on December 29, 1981, expressly denied alimony, it is not unreasonable to conclude that the Circuit Court was satisfied that she should not be entitled to any alimony.
Based on the foregoing, this Court is constrained to consider that the hold harmless agreement for rehabilitative alimony is in fact an obligation for indebtedness and not support and the same is not within the exceptive provisions of § 523(a)(5). Thus, it is within the general protection of the general bankruptcy discharge entered in this Chapter 7 case.
A separate Final Judgment will be entered in accordance with the foregoing. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490715/ | FINDINGS OF FACT AND CONCLUSIONS OF LAW
SIDNEY M. WEAVER, Bankruptcy Judge.
THIS CAUSE having come before the Court upon Sure-Snap Corporation’s (the debtor’s) Complaint for Declaratory Judgment, to Set Aside Pre-Petition Conveyance, for Turnover of Funds, and for Money Judgment pursuant to 11 U.S.C. § 542 and the Court having heard the testimony, examined the evidence presented, observed the candor and demeanor of the witnesses, considered the arguments of counsel, and being otherwise fully advised in the premises, does hereby make the following Findings of Fact and Conclusions of Law:
Jurisdiction is vested in this Court pursuant to 28 U.S.C. § 157(a), (b) and § 1334(b) and the district court’s general order of reference. This is a core proceeding in which the Court is authorized to hear and determine all matters relating to this case in accordance with 28 U.S.C. § 157(b).
Defendants asserted at the trial that the pleadings stated facts not in evidence at the trial. To the extent that the pleadings were inconsistent with the evidence at the trial, the pleadings are amended to conform to the evidence at the trial pursuant to Bankruptcy Rule 7015.
*418The motion at the trial of defendants Jerry Pescow, Gary Shure, Robert Shure, Peter Shure and Agnes Shure to dismiss the counterclaim and cross-claim of defendants Jerry Pescow, Robert Shure, Gary Shure, Peter Shure and Agnes Shure against the plaintiff and Elaine J. Shure was granted at the trial. The motion of Gary Shure to dismiss the separate counterclaim and cross-claim against the debtor and Elaine J. Shure and others as yet unknown on behalf of Gary Shure, not directly relevant to the life insurance policy, was granted as to Elaine J. Shure personally, and the counterclaim of Gary Shure for allowance of his claim filed in this case was severed pursuant to Bankruptcy Rule 7021, and will be tried by a separate objection to the claim of Gary Shure to be filed by the debtor.
American General Life Insurance Company of New York is a party defendant in its capacity as the successor in interest to Standard Security Life Insurance Company of New York on the life insurance policy.
On August 19, 1977, Standard Security Life Insurance Company of New York issued a life insurance policy in the face amount of $100,000 (the “life insurance policy”) insuring the life of Alfred Shure, the president and chief operating officer of the debtor. The life insurance policy was a whole life key man insurance policy with a cash surrender value, and listed the debtor as the owner and the only beneficiary on it. The debtor paid all the premiums on the life insurance policy between August 19, 1977 and the death of the insured, which occurred on March 1, 1987.
Upon the death of Alfred Shure, conflicting claims to the insurance proceeds were asserted by the debtor and various of the defendants in this case. The debtor commenced this litigation to determine the rightful owner of the proceeds. Prior to trial, the insurance proceeds held by American General Life Insurance Company of New York were deposited in an interest-bearing account at Northern Trust Bank pursuant to an Order Approving Stipulation for Deposit of Funds entered on May 9, 1988.
The defendants argue that Alfred Shure created a trust for the benefit of the defendants and then caused the beneficiary of the life insurance policy to be changed from the debtor to the trust. The debtor argues that there is no documentary evidence that the trust was settled or that the debtor ever changed the beneficiary on the life insurance policy from itself to a trust.
The debtor argues that the applicable law is contained in 11 U.S.C. § 541(a), which provides in pertinent part that:
(a) The commencement of a case under section 301, 302, or 303 of this title creates an estate. Such estate is comprised of all the following property, wherever located and by whomever held:
(1) Except as provided in subsections (b) and (c)(2) of this section, all legal or equitable interests of the debtor in property as of the commencement of the case.
In addition, 11 U.S.C. § 542(a) provides that:
(a) Except as provided in subsection (c) or (d) of this section, an entity, other than a custodian, in possession, custody, or control, during the case, of property that the trustee may use, sell or lease under section 363 of this title, or that the debtor may exempt under section 522 of this title, shall deliver to the trustee and account for, such property or the value of such property, unless such property is of inconsequential value or benefit to the estate.
Although the defendants urged that a trust had been settled, and that the debtor had changed the beneficiary of the insurance policy from the debtor to the trust, the corporate minute book reflects no such change, and the testimony offered in support of this theory was not credible. In addition, the trust instrument does not bear the signature of the trustee. Therefore, the Court finds that no change in the stated beneficiary occurred between the issuance of the policy and the death of the insured, and that no trust was in fact settled.
Based upon these findings, the Court concludes that the proceeds from the life *419insurance policy are property of the debtor pursuant to 11 U.S.C. § 541, and that those proceeds must be turned over to debtor pursuant to 11 U.S.C. § 542(a). See In re Cooperativa Cafeteros de P.R., 37 B.R. 952, 955 (D.P.R.1984). See also Holland America Insurance Co. v. Succession of Roy, 777 F.2d 992, 996 (5th Cir.1985); Jackson Park Realty Co., Inc. v. Williams (In re O’Neill Enterprises, Inc.), 547 F.2d 812, 815 (4th Cir.1977).
Accordingly, the proceeds of the life insurance policy now held by Kimbrell & Hamann and deposited in an account at Northern Trust Bank with the debtor’s tax identification number resulting from payment by American General Life Insurance Company of New York shall be paid over to the debtor.
A separate Final Judgment of even date has been entered in conformity herewith. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490716/ | MEMORANDUM DECISION
THOMAS C. BRITTON, Chief Judge.
The plaintiff creditor seeks exception from discharge under 11 U.S.C. *431§ 523(a)(2)(B) for its claim of $5,000. The debtor has answered and the matter was tried on May 31. I conclude that the claim should be excepted from this debtor’s discharge and that plaintiff is entitled to judgment against the debtor in the amount claimed.
In connection with a loan of $5,000, the debtor was required to and did execute and deliver to plaintiff a written financial statement on September 11, 1987. This statement showed a total of $347,194 owed to 10 creditors. It was materially false. The debtor does not dispute that an additional $460,000 was owed at that time to 25 other creditors.
The debtor’s explanation is that he told the loan officer that he had many debts, could not recall them all, and requested the lender to obtain a credit report. Although the statement bears the handwritten sentence: “I have no other debts”, the debtor recalls being asked to add the sentence, but believes he added the notation “CR” after the sentence. He intended by this reference to reflect his request that the lender get a credit report. In fact, credit reports from two agencies were requested.1
The loan officer who handled this transaction states that he followed the customary and standard procedure in requesting a credit check (from Century II Credit Bureau) which was consistent with the debt- or’s statement. He had no knowledge of the other debts and would have denied the loan had he been aware of them. He recalls no discussion as related by the debtor. He is unable to explain the request for the other credit report (TRW), which he never saw. Neither that report nor a copy is in evidence.
A credit report from TRW dated May 26, 1988, eight months after the loan, is in evidence. It show other debts and it also shows enough defaults to other creditors to discourage any lender. The lapse of time prevents any assumption that it reflects the credit record at the time of the loan. I believe the loan officer’s testimony that he never saw any TRW report. Had he seen a report this negative, I do not believe he or any other loan officer would have approved the loan.
The debtor’s stated annual income was $95,000 and the lender’s previous experience with the debtor had been good.
It is plaintiff’s burden to prove that it “reasonably relied” upon the written statement, and that the statement was furnished “with intent to deceive”. § 523(a)(2)(B)(iii) and (iv). I find that it has done so.
On this conflicting record, I accept the loan officer’s testimony. The debtor’s version is a bizarre one, disputed by the loan officer, contradictory to the document which the debtor signed, and unsupported by any other evidence. It is unlikely that any loan officer would approve a loan under the circumstances as related by the debtor, and I find it difficult to believe that this debtor was unable to recall, at least in general terms, the debts which he omitted.
Under these circumstances, the materially false statement was either knowingly false or made so recklessly as to constitute a fraud upon the creditor. 3 Collier on Bankruptcy ¶ 523.09[5][b] n. 23 (15th rev. ed. 1988).
Of the total loaned, $1,278 was used to satisfy an existing loan owed to the same lender. The debtor argues that only the balance is new value and is, therefore, not dischargeable. Before the enactment of the present Code in 1978, there were decisions to this effect. However, the legislative history of the present Code makes it clear that:
“The amount of the debt made nondis-chargeable on account of a false financial statement is not limited to ‘new value’ extended when a loan is rolled over.” Id. ¶ 523.10.
As is required by B.R. 9021(a), a separate judgment will be entered excepting plain*432tiffs claim in the amount of $5,000 from discharge. Costs may be taxed on motion.
. Counsel agree that the second report (TRW) was requested by the lender the day the financial statement was executed. I do not see the notation on Exhibit B that persuaded counsel, but accept their conclusion. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483361/ | Supreme Court
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IN THE SUPREME COURT OF THE STATE OF NEVADA
DANNY LORA, No. 85515
Appellant,
Vs. .
THE STATE OF NEVADA, | LL ED
Respondent.
ORDER DISMISSING APPEAL
This is a pro se notice of appeal from a purported district court
order dismissing a postconviction petition for a writ of habeas corpus.
Seventh Judicial District Court, White Pine County; Steve L. Dobrescu,
Judge.
This court’s review of this appeal reveals a jurisdictional defect.
Specifically, no decision had been made on the petition when appellant filed
the notice of appeal on October 11, 2022. Thus, the notice of appeal is
premature. See NRS 177.015(3) (stating that a defendant only may appeal
from a final judgment or verdict). Appellant may file an appeal from a final
order of the district court dismissing his petition. Accordingly, this court
ORDERS this appeal DISMISSED.
Hardesty
ANG! A Ts
Stiglich Herndon
cc: Hon. Steve L. Dobrescu, District Judge
Danny Lora
Attorney General/Carson City
White Pine County District Attorney
Attorney General/Ely
| White Pine County Clerk
|
|
SuPREME CourT
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(0) IM7A oi | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483362/ | IN THE SUPREME COURT OF THE STATE OF NEVADA
IN THE MATTER OF THE PARENTAL No. 84949
RIGHTS AS TO: I. M. H., A MINOR.
FilLeD
ROCHELLE H..,
Appellant,
vs.
CLARK COUNTY DEPARTMENT OF
FAMILY SERVICES; AND I. M.H., A
MINOR,
Respondents.
ORDER DISMISSING APPEAL
This is a pro se appeal from a district court order terminating
appellant’s parental rights. Eighth Judicial District Court, Clark County;
Cynthia N. Giuliani, Judge.
Since the docketing of this appeal on June 30, 2022, two notices
issued by the clerk of this court and one order entered by this court and
addressed to appellant have been returned by the postal service as
undeliverable.! The postal service noted that it was unable to forward any
of the documents. The opening brief was due to be filed by October 17, 2022.
Appellant has not filed the opening brief, or any other documents in this
matter, and has not otherwise communicated with this court. Under these
1A copy of one order entered by this court and addressed to appellant
was not returned as undeliverable.
Supreme Count
OF
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: \9aTA = 90, -ODOL
circumstances, it appears that appellant has abandoned this appeal and
this court
ORDERS this appeal DISMISSED.
JM luc, J.
Hardesty
Agent ab A— J.
Stiglich Herndon
ce: Hon. Cynthia N. Giuliani, District Judge
Rochelle H.
Clark County District Attorney/Juvenile Division
Legal Aid Center of Southern Nevada, Inc.
Eighth District Court Clerk
Supreme Court
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https://www.courtlistener.com/api/rest/v3/opinions/8483359/ | Supreme Court
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IN THE SUPREME COURT OF THE STATE OF NEVADA
ROY DANIELS MORAGA, No. 85481
Appellant, am,
THE STATE OF NEVADA,
Respondent. NOV 10 2022
ELI
25 supped F COURT
LV fw.
DEPUTY/CLERK
ORDER DISMISSING APPEAL "
This is a pro se appeal from an “Order Denying Defendant's
Motion for Production of Documents Under the Freedom of Information Act
5 USCA 512.” Eighth Judicial District Court, Clark County; Carolyn
Ellsworth, Judge.
Because no statute or court rule permits an appeal from the
aforementioned order, we lack jurisdiction. Castillo v. State, 106 Nev. 349,
352, 792 P.2d 1133, 1135 (1990). Accordingly, we
ORDER this appeal DISMISSED.
pAg. kaat, ve de
Hardesty ,
Aigo, a——
Stiglich Herndon
ce: Hon, Carolyn Ellsworth, Senior Judge
Roy Daniels Moraga
Attorney General/Carson City
Clark County District Attorney
Eighth District Court Clerk
20- OT KO | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483363/ | IN THE SUPREME COURT OF THE STATE OF NEVADA
IN THE MATTER OF DISCIPLINE OF No. 85252
DIANE J. HARRISON, BAR NO. 8813. . f L c
. FU
NOV 10 2
EL A. BRO
CLERKVOF BU E
°
IEF DEPUTY CLERK
ORDER DENYING PETITION FOR RECIPROCAL DISCIPLINE
This is a petition under SCR 114 to reciprocally discipline
attorney Diane J. Harrison based on her disciplinary revocation in Florida
' for allegations regarding violations of SEC rules regarding antifraud,
registration, and reporting. Without admitting fault, Harrison petitioned
in Florida for and was granted disciplinary revocation with leave to seek
readmission after five years. See Florida R. of Discipline 3-7.12 (allowing
an attorney to petition for a disciplinary revocation, which bars an attorney
from practicing law in Florida with or without leave to seek readmission,
when a disciplinary agency is investigating the attorney). She is therefore
barred from practicing law in Florida for five years, after which she may
seek readmittance by fully complying “with the rules and regulations
governing admission to the bar.” Florida R. of Discipline 3-7.10(n)(2).
Harrison opposes the reciprocal discipline petition, arguing that the State
Bar of Nevada has not proven by clear and convincing evidence that she
committed the violations charged given that she did not admit, and the ©
Florida Bar did prove, any violations.
Under SCR 114(4), this court must impose identical reciprocal
discipline unless the attorney demonstrates or this court determines that
(1) the other jurisdiction failed to provide adequate notice, (2) the other
Supreme Court
OF jurisdiction imposed discipline despite a lack of proof of misconduct, (3) the
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established misconduct warrants substantially different discipline in this
jurisdiction, or (4) the established misconduct does not constitute
misconduct under Nevada’s professional conduct rules.
We conclude that all but the first exception weigh against the
imposition of the discipline that the Bar posits is reciprocal—a five-year-
and-one-day suspension. Indeed, there is no evidence in the record attached
to the petition that Harrison admitted to or committed any misconduct, and
the Supreme Court of Florida found no misconduct in granting Harrison’s
disciplinary revocation petition. Without proof of actual misconduct, we
cannot determine whether the actions constitute misconduct in Nevada
and/or if substantially different discipline would be warranted.!
Accordingly, we deny the petition.
It is so ORDERED.?
Parraguirre Hardesty
Ate 9 J. Lah J.
Stiglich ~ Cadish
Peaboruny J. Qo J.
Pickering Herndon
ec: Bar Counsel, State Bar of Nevada
Diane Joy Harrison
_1This order in no way precludes the State Bar from investigating any
possible attorney misconduct by Harrison if such an investigation is
appropriate pursuant to the Supreme Court Rules.
supreme Court 2The Honorable Abbi Silver having retired, this matter was decided
oF by a six-justice court.
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https://www.courtlistener.com/api/rest/v3/opinions/8483365/ | Supreme Court
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IN THE SUPREME COURT OF THE STATE OF NEVADA
ARCHIE WILSON ERVIN, No. 85424
Appellant, ea Pe
vi, FILED
THE STATE OF NEVADA, NOV 10 2Uzz
Respondent.
BLIZADETY 4. BRON
S OF JUPREME COUR"
ORDER DISMISSING APPEAL et
DEPOWY CLERK
This is a direct appeal from a judgment of conviction. Third
Judicial District Court, Lyon County; John Schlegelmilch, Judge.
Appellant’s counsel has filed a notice of voluntary withdrawal
of this appeal. Counsel advises this court that he has informed appellant of
the legal effects and consequences of voluntarily withdrawing this appeal,
including that appellant cannot hereafter seek to reinstate this appeal, and
that any issues that were or could have been brought in this appeal are
forever waived. Having been so informed, appellant consents to a voluntary
dismissal of this appeal. Cause appearing, this court
ORDERS this appeal DISMISSED.!
(oth. es
Cadish
Preerurp
Pickering )
1Because no remittitur will issue in this matter, see NRAP 42(b), the
one-year pericd for filing a postconviction habeas corpus petition under NRS
34.726(1) shall commence to run from the date of this order.
The Honorable Mark Gibbons, Senior Justice, participated in this
matter under a general order of assignment.
2.468 08
ec: Hon. John Schlegelmilch, District Judge
Brock Law, Ltd.
Walther Law Offices, PLLC
Attorney General/Carson City
Lyon County District Attorney
Third District Court Clerk
Supreme Court
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(O17 aE | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483357/ | IN THE SUPREME COURT OF THE STATE OF NEVADA
BRIAN KERRY O'KEEFE, No. 85492
Appellant,
vs. ie
THE STATE OF NEVADA, P E B
Respondent.
NOV 10 2022
ELIZABE MA A. BLOWN
OF SAPREME COURT
ORDER DISMISSING APPEAL
This is a pro se notice of appeal from “the ORDER granting,
nine days subsequent the directed response of 9/13/2023.” Because no
statute or court rule permits an appeal from such an order, this court lacks
jurisdiction to consider this appeal. Castillo v. State, 106 Nev. 349, 352, 792
P.2d 1133, 1135 (1990) (explaining that court has jurisdiction only when
statute or court rule provides for appeal). Accordingly, this court
ORDERS this appeal DISMISSED. !
Prekor itp
Pickering )
1The Honorable Mark Gibbons, Senior Justice, participated in the
decision of this matter under a general order of assignment.
SupPREME Court
OF
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ee i 22-550}
cc: Hon. Jacqueline M. Bluth, District Judge
Brian Kerry O'Keefe
Attorney General/Carson City
Clark County District Attorney
Eighth District Court Clerk
Supreme Court
OF
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(OH 197A oe
a a es a | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483364/ | IN THE SUPREME COURT OF THE STATE OF NEVADA
IN THE MATTER OF DISCIPLINE OF No. 85192 .
ANDRAS F. BABERO, BAR NO. 1658 - E i LE i 2
NOV 10 202
ORDER OF SUSPENSION
This is an automatic review of a Southern Nevada Disciplinary
Board hearing panel’s recommendation that attorney Andras F, Babero be
suspended from the practice of law for four years based on violations of RPC
1.1 (competence), RPC 1.3 (diligence), RPC 1.4 (communication), RPC 1.15
(safekeeping property), RPC 1.16 (declining or terminating representation),
RPC 3.2 (expediting litigation), RPC 5.5 (unauthorized practice of law), and
RPC 8.4 (misconduct). Because no briefs have been filed, this matter stands
submitted for decision based on the record. SCR 105(3)(b).
The State Bar has the burden of showing by clear and
convincing evidence that Babero committed the violations charged. See In
re Discipline of Drakulich, 111 Nev. 1556, 1566, 908 P.2d 709, 715 (1995).
We defer to the panel’s factual findings that Babero violated the above-
referenced rules as those findings are supported by substantial evidence
and are not clearly erroneous. See SCR 105(3)(b); In re Discipline of Colin,
135 Nev. 325, 330, 448 P.3d 556, 560 (2019). In particular, the record shows
that, in representing a client and the client’s business in two cases, Babero
failed to diligently work on the cases and to keep the chent informed as to
their status. Babero also worked on one case while administratively
suspended for not filing the required CLE report. Ultimately, Babero
stopped working on the cases, resulting in the dismissal of the client's
claims in one case and a substantial adverse default judgment of $10 million
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($2.5 million in compensatory damages and $7.5 million in punitive
damages) in the other.
Turning to the appropriate discipline, we review the hearing
panel’s recommendation de novo. SCR 105(3)(b). Although we
“must... exercise independent judgment,” the panel’s recommendation is
persuasive. In re Discipline of Schaefer, 117 Nev. 496, 515, 25 P.3d 191, 204
(2001). In determining the appropriate discipline, we weigh four factors:
“the duty violated, the lawyer’s mental state, the potential or actual injury
caused by the lawyer’s misconduct, and the existence of aggravating or
mitigating factors.” In re Discipline of Lerner, 124 Nev. 1232, 1246, 197
P.3d 1067, 1077 (2008).
The above actions violated the duties Babero owed to his client
and the legal system. His mental state was knowing and his actions caused
serious actual injury to his client, with the potential for further injury. The
baseline sanction for Babero’s misconduct, before considering aggravating
and mitigating circumstances, is suspension. See Standards for Imposing
Lawyer Sanctions, Compendium of Professional Responsibility Rules and
Standards, Standards 4.42(a) (Am. Bar Ass'n 2017) (recommending
suspension when “a lawyer knowingly fails to perform services for a client
and causes injury or potential injury to a client”). The panel found, and the
record supports, one aggravating circumstance (substantial experience in
the practice of law) and three mitigating circumstances (absence of a recent
prior disciplinary record, absence of a dishonest or selfish motive, and
personal or emotional problems). Considering all the factors, we conclude
that a three-year suspension 1s sufficient to serve the purpose of attorney
discipline, see State Bar of Nev. v. Claiborne, 104 Nev. 115, 213, 756 P.2d
464, 527-28 (1988) (observing the purpose of attorney discipline is to protect
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2
the public, the courts, and the legal profession), rather than the four-year
suspension recommended by the hearing panel.
Accordingly, we hereby suspend attorney Andras F. Babero
from the practice of law in Nevada for a period of three years commencing
from the date of this order. Babero shall also pay the costs of the
disciplinary proceedings, including $2,500 under SCR 120, within 30 days
from the date of this order. The parties shall comply with SCR 115 and SCR
121.1.
It is so ORDERED.!
Parraguirre Hardesty ;
a
Ata LQ . lay ~ we.
Stiglich — Cadish
chong J. ey J.
Pickering Herndon
cc: Chair, Southern Nevada Disciplinary Board
Andras F. Babero
Bar Counsel, State Bar of Nevada
Executive Director, State Bar of Nevada
Admissions Office, U.S. Supreme Court
1The Honorable Abbi Silver having retired, this matter was decided
Supreme Court by a six-justice court.
OF
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3 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483366/ | IN THE SUPREME COURT OF THE STATE OF NEVADA
DONALD ALT, No. 85568
Appellant,
Vs.
TAHOE-RENO INDUSTRIAL CENTER, FILED
LLC, MANAGING MEMBER; NORMAN
PROPERTIES, INC.; L. LANCE Nov 10 2022
GILMAN COMMERCIAL REAL
ELIZABE HA. BROWN
OF SUPREME CO
ESTATE SERVICES INC., PRINCIPLE,
DIRECTOR AND EXECUTIVE,
LEONARD LANCE GILMAN; NORMAN
PROPERTIES, INC., CHIEF
EXECUTIVE OFFICER, CYNTHIA
GAGLIANO; AND SECRETARY, DON
ROGER NORMAN,
Respondents.
ORDER DISMISSING APPEAL
This is a pro se appeal from a district court order granting a
motion to dismiss and from an “Order Denying Plaintiffs Amended Default
and Request for Default Judgment Hearing.” First Judicial District Court,
Storey County; James Todd Russell, Judge.
Review of the notice of appeal and documents before this court
reveals a jurisdictional defect. The order granting the motion to dismiss is
not a final judgment appealable under NRAP 3A(b)(1) because it does not
resolve all of the claims appellant asserted against all respondents in the
district court. See Lee v. GNLV Corp., 116 Nev. 424, 426, 996 P.2d 416, 417
(2000) (“[A] final judgment is one that disposes of all the issues presented
in the case, and leaves nothing for the future consideration of the court,
except for post-judgment issues such as attorney's fees and costs.”). It does
not appear from the district court docket sheet that the district court has
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entered a final judgment in this matter. And no other statute or court rule
authorizes an appeal from the order of dismissal. See Brown v. MHC
Stagecoach, LLC, 129 Nev. 343, 345, 301 P.3d 850, 851 (2013) (this court
“may only consider appeals authorized by statute or court rule”). Neither
does any statute or court rule authorize an appeal from an “Order Denying
Plaintiffs Amended Default and Request for Default Judgment Hearing.”
Accordingly, this court lacks jurisdiction and
ORDERS this appeal DISMISSED.!
*
Cadish -
Prevoruie a
Pickering
ec: Hon. James Todd Russell, District Judge
Donald Alt
Gunderson Law Firm
Cynthia Gagliano
Don Roger Norman
Storey County Clerk
1The Honorable Mark Gibbons, Senior Justice, participated in this
matter under a general order of assignment | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483371/ | Case: 22-50172 Document: 00516542466 Page: 1 Date Filed: 11/11/2022
United States Court of Appeals
for the Fifth Circuit
United States Court of Appeals
Fifth Circuit
No. 22-50172
Summary Calendar FILED
November 11, 2022
Lyle W. Cayce
United States of America, Clerk
Plaintiff—Appellee,
versus
Jarod Richard Melancon,
Defendant—Appellant.
Appeal from the United States District Court
for the Western District of Texas
USDC No. 4:21-CR-507-1
Before King, Higginson, and Willett, Circuit Judges.
Per Curiam:*
Jarod Richard Melancon, without a written plea agreement, pleaded
guilty to drug trafficking and firearms charges, and the district court imposed
a total sentence of 300 months of imprisonment. On appeal, Melancon
contends that the district court plainly erred when calculating his guidelines
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 22-50172 Document: 00516542466 Page: 2 Date Filed: 11/11/2022
No. 22-50172
range by applying the two-level aggravating role enhancement in U.S.S.G.
§ 3B1.1(c). According to Melancon, the presentence report lacks factual
predicates supporting that he either exercised control over others, including
Nichole Sayre, or managed the criminal organization’s assets. He argues that
applying the enhancement was clear or obvious error and that its effect on
the calculation of his guidelines range satisfies plain error review.
Generally, we review the finding of an aggravating role adjustment for
clear error. United States v. Anguiano, 27 F.4th 1070, 1074-75 (5th Cir. 2022).
The sentencing court may “draw reasonable inferences from the facts, and
these inferences are fact-findings reviewed for clear error as well.” Id. at 1073
(internal quotation marks and citation omitted). “A factual finding that is
plausible based on the record as a whole is not clearly erroneous.” Id.
(internal quotation marks and citation omitted). However, because
Melancon did not object to the § 3B1.1(c) enhancement in the district court,
we review his challenges for plain error. See Anguiano, 27 F.4th at 1075.
The district court did not err in applying the § 3B1.1(c) enhancement
because the conclusion that Melancon exercised control over Sayre as a
participant in the offense is plausible based on the record, which included
evidence that Sayre helped Melancon distribute drugs and drug proceeds at
his direction. See Anguiano, 27 F.4th at 1073; United States v. Turner, 319
F.3d 716, 725 (5th Cir. 2003) (“When the evidence demonstrates that a
defendant directed another in his drug trafficking activities, . . . sentence
enhancement under § 3B1.1(c) is appropriate.”). Accordingly, the judgment
of the district court is AFFIRMED.
2 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483369/ | United States Court of Appeals
for the Fifth Circuit
United States Court of Appeals
Fifth Circuit
___________ FILED
November 11, 2022
No. 21-10556 Lyle W. Cayce
___________ Clerk
United States of America,
Plaintiff—Appellee,
versus
Joshua Seekins,
Defendant—Appellant.
______________________________
Appeal from the United States District Court
for the Northern District of Texas
USDC No. 3:19-CR-563-1
______________________________
ON PETITION FOR REHEARING EN BANC
Before Stewart, Elrod, and Graves, Circuit Judges.
Per Curiam:
Treating the petition for rehearing en banc as a petition for panel re-
hearing (5th Cir. R. 35 I.O.P.), the petition for panel rehearing is DE-
NIED. The petition for rehearing en banc is DENIED because, at the re-
quest of one of its members, the court was polled, and a majority did not vote
in favor of rehearing (Fed. R. App. P. 35 and 5th Cir. R. 35).
No. 21-10556
In the en banc poll, seven judges voted in favor of rehearing (Jones,
Smith, Willett, Ho, Duncan, Engelhardt, and Oldham), and nine voted
against rehearing (Richman, Stewart, Dennis, Elrod, Southwick, Haynes,
Graves, Higginson, and Wilson).
2
No. 21-10556
James C. Ho, Circuit Judge, joined by Smith and Engelhardt,
Circuit Judges, dissenting from denial of rehearing en banc:
In a country populated by well over 300 million people, we’re bound
to vociferously disagree on a wide range of issues. Indeed, the Anti-
Federalists opposed the proposed United States Constitution and the
creation of our national government for that very reason.
As the Anti-Federalists explained, “[h]istory furnishes no example of
a free republic, any thing like the extent of the United States.” Brutus I
(Oct. 18, 1787), in 2 The Complete Anti-Federalist 368 (Herbert
J. Storing ed. 1981). That’s because, they cautioned, “a free republic cannot
succeed over a country of such immense extent, containing such a number of
inhabitants, . . . as that of the whole United States.” Id. They warned that
“[t]he laws and customs of the several states are, in many respects, very
diverse, and in some opposite.” Id. at 370. They feared that the proposed
United States “would not only be too numerous to act with any care or
decision, but would be composed of such heterogenous and discordant
principles, as would constantly be contending with each other.” Id. They
worried that republics could prosper only if “the manners, sentiments, and
interests of the people should be similar,” as would only exist if the republic
were “confined to a single city” or over a “small” territory. Id. at 369.
The Federalists, of course, prevailed. They predicted that we would
be better off if we could come together as a single, unified country—that
enormous diplomatic, military, economic, and other benefits would
inevitably flow from scale. See, e.g., The Federalist No. 14, at 99 (James
Madison) (Clinton Rossiter ed., 1961) (“We have seen the necessity of the
Union, as our bulwark against foreign danger, as the conservator of peace
among ourselves, as the guardian of our commerce and other common
interests.”). And they promised that we would come together, and that Anti-
3
No. 21-10556
Federalist fears would not become reality, because our new national
government would be one of limited powers—one that would respect our
great diversity of viewpoints, by preserving community differences and local
rules. See, e.g., id. at 102 (“[T]he general government is not to be charged
with the whole power of making and administering laws. Its jurisdiction is
limited to certain enumerated objects, which concern all the members of the
republic, but which are not to be attained by the separate provisions of any.
The subordinate governments, which can extend their care to all those other
subjects which can be separately provided for, will retain their due authority
and activity.”).
But constitutional limits on governmental power do not enforce
themselves. They require vigilant—and diligent—enforcement.
For too long, our circuit precedent has allowed the federal
government to assume all but plenary power over our nation. In particular,
our circuit precedent licenses the federal government to regulate the mere
possession of virtually every physical item in our nation—even if it’s
undisputed that the possession of the item will have zero impact on any other
state in the union. The federal government just has to demonstrate that the
item once traveled across state lines at some point in its lifetime, no matter
how distant or remote in time. See United States v. Rawls, 85 F.3d 240, 242–
43 (5th Cir. 1996).
That is no limit at all. If the only thing limiting federal power is our
ability to document (or merely speculate about) the provenance of a
particular item, the Founders’ assurance of a limited national government is
nothing more than a parchment promise.
Rehearing this case en banc would have given us an ideal vehicle and
welcome opportunity to reconsider our mistaken circuit precedent. I dissent
from the denial of rehearing en banc.
4
No. 21-10556
***
The Constitution creates a federal government of enumerated
powers. See U.S. Const. art. I, § 8. And those powers are “few and
defined.” United States v. Lopez, 514 U.S. 549, 552 (1995) (citing The
Federalist No. 45, at 292–93 (James Madison) (Clinton Rossiter ed.,
1961)). See also Marbury v. Madison, 1 Cranch 137, 176 (1803) (“The powers
of the legislature are defined, and limited; and that those limits may not be
mistaken, or forgotten, the constitution is written.”). This enumeration
ensures “a healthy balance of power between the States and the Federal
Government [and] reduce[s] the risk of tyranny and abuse from either front.”
Lopez, 514 U.S. at 552 (cleaned up).
But now consider the facts presented in this case: The federal
government seeks to incarcerate a homeless man (and previously convicted
felon) for possessing two shotgun shells that he found in a dumpster.
It’s hard to imagine a more local crime than this. There’s no record
evidence that his possession of these items will have any impact on any other
state. There’s no record evidence of any commercial transaction of any kind
involving the shells—or even that the shells traveled across state lines at any
particular moment in time. All that’s here is testimony that the manufacturer
of shells that match the items possessed by Seekins manufactured those
shells in another state.
A panel of this court was duty-bound to uphold the conviction as a
matter of circuit precedent. United States v. Seekins, 2022 WL 3644185, *2
(5th Cir. 2022). Accordingly, Seekins argues that Rawls and its progeny
warrant en banc review because they are “premised on serious error” and
are contrary to structural limits on the federal government’s power under the
Commerce Clause.
5
No. 21-10556
I agree. There must be some limit on federal power under the
Commerce Clause. But our circuit precedent fails to recognize this. Our
precedent on felon-in-possession statutes allows the federal government to
regulate any item so long as it was manufactured out-of-state—without any
regard to when, why, or by whom the item was transported across state lines.
But that would mean that the federal government can regulate virtually every
tangible item anywhere in the United States. After all, it’s hard to imagine
any physical item that has not traveled across state lines at some point in its
existence, either in whole or in part.
The Supreme Court has repeatedly warned us that the Commerce
Clause power “must be read carefully to avoid creating a general federal
authority akin to the police power.” NFIB v. Sebelius, 567 U.S. 519, 536
(2012). Yet our circuit precedent would allow just that. If it’s enough that
some object (or component of an object) at some unknown (and perhaps
unknowable) point in time traveled across state lines to confer federal
jurisdiction, it’s hard to imagine anything that would remain outside the
federal government’s commerce power. There is no plausible reading of the
Commerce Clause, as originally understood by our Founders, that could
possibly give the federal government such reach. See, e.g., Lopez, 514 U.S. at
585–587 (Thomas, J., concurring) (discussing the original meaning of the
Commerce Clause). See also Randy E. Barnett, The Original Meaning of the
Commerce Clause, 68 U. Chi. L. Rev. 101, 146 (2001) (“The most
persuasive evidence of original meaning . . . strongly supports Justice
Thomas’s and the Progressive Era Supreme Court’s narrow interpretation
of the Congress’s power [under the Commerce Clause].”); William J.
Seidleck, Originalism and the General Concurrence: How Originalists Can
Accommodate Entrenched Precedents While Reining in Commerce Clause
Doctrine, 3 U. Pa. J. L. & Pub. Affs. 263, 269 (2018) (“The founding
generation understood the term ‘commerce’ to mean only ‘trade or exchange
6
No. 21-10556
of goods.’ . . . The writings of the framers and the purpose behind the creation
of the Commerce Clause also confirm its intended narrow scope.”).
Indeed, every member of the panel in Rawls recognized this problem.
The entire panel specially concurred, noting that “one might well wonder
how it could rationally be concluded that mere possession of a firearm in any
meaningful way concerns interstate commerce simply because the firearm
had, perhaps decades previously before the charged possessor was even born,
fortuitously traveled in interstate commerce.” 85 F.3d at 243 (Garwood, J.,
specially concurring).
Rawls nevertheless affirmed the constitutionality of the conviction
under the Commerce Clause because the panel believed that Supreme Court
precedent required them to do so. In Scarborough v. United States, 431 U.S.
563 (1977), the Supreme Court held the then-operative felon-in-possession
statute was satisfied merely by the firearm’s transportation, at some point in
time, across state lines. 431 U.S. 563, 577 (1977).
But our reliance on Scarborough was erroneous for at least two reasons.
First, the Court’s holding in Scarborough was statutory, not constitutional.
See Scarborough, 431 U.S. at 567, 569–77. See also J. Richard Broughton, The
Ineludible (Constitutional) Politics of Guns, 46 Conn. L. Rev. 1345, 1360
(2014). Second, Scarborough pre-dates Lopez, where the Court cabined the
constitutional power of the federal government under the Commerce Clause.
See 514 U.S. at 568.
A number of circuit judges nationwide have noted the fundamental
inconsistency between Lopez and Scarborough. See, e.g., United States v.
Kuban, 94 F.3d 971, 977–78 (5th Cir. 1996) (DeMoss, J., dissenting) (“[T]he
precise holding in Scarborough is in fundamental and irreconcilable conflict
with the rationale of the United States Supreme Court in United States v.
Lopez[.] . . . The mere fact that a felon possesses a firearm which was
7
No. 21-10556
transported in interstate commerce years before the current possession
cannot rationally be determined to have a substantial impact on interstate
commerce as of the time of current possession.”) (quotation omitted);
United States v. Alderman, 565 F.3d 641, 648–650 (9th Cir. 2009) (Paez, J.,
dissenting) (arguing the majority’s upholding of the felon-in-possession-of-
body-armor statute inappropriately extends Scarborough beyond the limits
imposed by Lopez, United States v. Morrison, 529 U.S. 598 (2000), and
Gonzales v. Raich, 545 U.S. 1 (2005)).
Moreover, Justice Thomas has criticized the misapplication of
Scarborough to constitutional challenges under the Commerce Clause:
“[Y]ears ago in Lopez, [the Supreme Court] took a significant step toward
reaffirming th[e] Court’s commitment to proper constitutional limits on
Congress’ commerce power. If the Lopez framework is to have any ongoing
vitality, it is up to th[e] Court to prevent it from being undermined by a 1977
precedent that does not squarely address the constitutional issue.” Alderman
v. United States, 131 S. Ct. 700, 703 (2011) (Thomas, J., dissenting from the
denial of the petition for writ of certiorari). “[P]ermit[ting] Congress to
regulate or ban possession of any item that has ever been offered for sale or
crossed state lines” would be “[s]uch an expansion of federal authority” as
to “trespass on state police powers.” Id. at 703.
In sum, our circuit precedent dramatically expands the reach of the
federal government under the Commerce Clause. No Supreme Court
precedent requires it. And no proper reading of the Commerce Clause
permits it. We should have granted en banc rehearing to reconsider circuit
precedent that—from its inception—circuit judges across the country have
criticized for contravening our Constitution’s limits on federal power.
8
No. 21-10556
***
Americans disagree passionately over a wide range of issues—
including a variety of criminal justice issues, such as whether felons should
be punished for possessing firearms. Compare, e.g., Dru Stevenson, In
Defense of Felon-in-Possession Laws, 43 Cardozo L. Rev. 1573, 1577
(2022), with Conor Friedersdorf, The Anti-gun Laws That Make Progressives
Uneasy, The Atlantic, Feb. 10, 2022 (noting that “recent criminal-
justice reform[er]s” seek to “avoid prosecuting people for gun possession
unless they were actually involved in violent crime”); Robert Weiss,
Rethinking Prison for Non-Violent Gun Possession, 112 J. Crim. L. &
Criminology 665 (2022); Zack Thompson, Is it Fair to Criminalize
Possession of Firearms by Ex-Felons?, 9 Wash. U. Juris. Rev. 150 (2016).
In these sharply divided times, I can think of no better moment to
reaffirm our Founders’ respect for diverse viewpoints and restore the proper
constitutional balance between our national needs and our commitment to
federalism.
I dissent from the denial of rehearing en banc.
9 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483389/ | THE SUPREME COURT OF TEXAS
Orders Pronounced November 8, 2022
MISCELLANEOUS
22-0997 IN RE STATE OF TEXAS; from Harris County
The district court’s temporary restraining order issued today in Cause No.
2022-73765, Texas Organizing Project v. Harris County, et al., is stayed.
Voting should occur only as permitted by Texas Election Code Section
41.032. Later cast votes should be segregated. | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483391/ | 11TH COURT OF APPEALS
EASTLAND, TEXAS
JUDGMENT
In the interest of L.C. and E.T., children * From the 326th District Court
of Taylor County,
Trial Court No. 10315-CX.
No. 11-22-00247-CV * November 10, 2022
* Per Curiam Memorandum Opinion
(Panel consists of: Bailey, C.J.,
Trotter, J., and Williams, J.)
This court has considered Appellant’s motion to dismiss this appeal and
concludes that the motion should be granted. Therefore, in accordance with this
court’s opinion, the appeal is dismissed. | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483388/ | UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
DISTRICT OF COLUMBIA,
Plaintiff,
v. Civil Action No. 20-1932 (TJK)
EXXON MOBIL CORPORATION et al.,
Defendants.
MEMORANDUM OPINION
The District of Columbia sued Defendants, a group of energy companies, for violating a
District of Columbia consumer protection law. The District alleges, among other things, that De-
fendants knowingly misrepresented the effects of fossil fuel products to consumers within the Dis-
trict through misleading advertisements and biased scientific studies. Defendants removed the
case to federal court, invoking seven bases for the Court’s subject-matter jurisdiction. The District
of Columbia moved to remand to Superior Court, and Defendants opposed. For the following
reasons, the Court will grant the District’s motion to remand.
Background
The District of Columbia (“the District”) sued Exxon Mobil, BP, Chevron, Shell Oil, and
relevant subsidiaries (“Defendants”) in District of Columbia Superior Court for alleged violations
of the D.C. Consumer Protection Procedures Act (“the Act”). ECF No. 1-14 at 6. According to
the District, Defendants have known about the harmful effects of fossil fuels for decades yet have
misrepresented those effects and “promoted disinformation” to District of Columbia consumers.
Id. at 36. The complaint alleges, for example, that Defendants “funded and controlled” scientists
to manipulate public perception on fossil fuels and embarked on “misleading” advertising cam-
paigns in the Washington Post and elsewhere to deceive the public about the effects of fossil fuels
on the environment. See, e.g., id. at 41–42. The District also alleges that Defendants’ violations
of the Act are ongoing, and that Defendants have now “turned their attention to misleading con-
sumers about their level of investment in cleaner energy sources.” Id. at 53. According to the
complaint, Defendants have undertaken “greenwashing campaigns,” in which they promote their
investment in “alternative energy sources” but intentionally overstate their commitment to non-
fossil fuels. See, e.g., id. at 58. According to the District, Defendants’ actions have caused “exis-
tential” environmental injuries—such as rising temperatures and sea levels—which cause “damage
[to] critical infrastructure and property,” “heat waves,” “flooding,” and other “extreme weather.”
ECF No. 1-14 at 52–53.
The District claims that each Defendant and its subsidiary violated the Act by “engaging
in a number of deceptive acts and practices in its marketing, promotion, and sale of fossil fuel
products.” ECF No. 1-14 at 77, 80, 82, 84–86. For relief, the District seeks an order enjoining
Defendants from violating the Act. It also seeks civil penalties, restitution, and damages as pro-
vided by the Act. Id. at 86–87; see D.C. Code § 28-3909.
Exxon removed the case to this Court, ECF No. 1, and the other defendants consented,
ECF No. 8, 12, 16. In the notice of removal, Defendants claimed that removal is proper because
(1) the claims arise under federal common law; (2) the lawsuit raises disputed and substantial
federal issues under Grable; (3) the action arises out of federal enclaves; (4) the Federal Officer
Removal statute applies; (5) the Outer Continental Shelf Lands Act applies; (6) diversity jurisdic-
tion exists; and (7) the Class Action Fairness Act applies. ECF No. 1 at 11–12. The District moved
to remand, ECF No. 45, and Defendants opposed, ECF No. 51. Since then, the parties have pep-
pered the docket with notices of supplemental authority. See, e.g., ECF Nos. 66, 68, 71, 74, 77,
78, 82, 84, 87, 89, 91, 93, 97, 103, 107, 108, 112, 114.
2
Legal Standard
Federal courts are courts of limited jurisdiction and “possess only that power authorized
by Constitution and statute.” Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 552
(2005). Thus, “[a] civil action filed in state court may only be removed to a United States district
court if the case could originally have been brought in federal court.” Nat’l Consumers League v.
Flowers Bakeries, LLC, 36 F. Supp. 3d 26, 30 (D.D.C. 2014) (citing 28 U.S.C. § 1441(a)). “When
a plaintiff files a motion to remand, the removing defendant bears the burden of proving that re-
moval was proper.” Arenivar v. Manganaro Midatlantic, LLC, 317 F. Supp. 3d 362, 367 (D.D.C.
2018) (internal quotation marks omitted). “If at any time before final judgment it appears that the
district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447.
“Any doubts about the existence of subject matter jurisdiction are to be resolved in favor of re-
mand.” Witte v. Gen. Nutrition Corp., 104 F. Supp. 3d 1, 3 (D.D.C. 2015) (cleaned up).
Analysis
Defendants raise seven theories for the Court’s subject-matter jurisdiction. Each, they say,
is an independent ground for removal. None is.
A. Federal Common Law Does Not Confer Jurisdiction Over the District’s
Claims
Defendants argue that the suit must be heard in federal court because the District’s claims
implicate interstate pollution, the navigable waters of the United States, and foreign affairs, and
therefore its consumer protection claims “necessarily” arise under federal common law. In other
words, even though the District did not plead a federal claim, Defendants say that the Court has
jurisdiction because claims “may arise under federal common law regardless of whether a plaintiff
affixes a federal law label.” ECF No. 51 at 29. In response, the District argues that federal com-
mon law does not apply to its state consumer protection claims, but even if it did, it cannot support
3
removal because the federal question must appear on the face of their well-pleaded complaint, and
complete preemption does not apply. ECF No. 63 at 18–19.
For Defendants to demonstrate federal-question jurisdiction on federal common law
grounds, they must first show that federal common law applies to the District’s false-advertising
claims or that the Court should fashion a new federal common law rule. Defendants come up well
short on this first step.
The Court has original jurisdiction over “all civil actions arising under the Constitution,
laws, or treaties of the United States.” 28 U.S.C. § 1331. “There is, of course, ‘no federal general
common law.’” Texas Indus., Inc. v. Radcliff Materials, 451 U.S. 630, 640 (1981) (quoting Erie
R.R. Co. v. Tomkins, 304 U.S. 64, 78 (1938)). But the Supreme Court has recognized “few and
restricted” areas of federal common law to protect “uniquely federal interests.” Id. Federal courts
should tread lightly in this area, however, because “whether latent federal power should be exer-
cised to displace state law is primarily a decision for Congress.” Atherton v. FDIC, 519 U.S. 213,
218 (1997) (cleaned up). In the rare instance when a federal court creates such a rule, it must
ensure two things. First, the state law or claim must affect “uniquely federal interests.” Boyle v.
United Techs. Corp., 487 U.S. 500, 504 (1988). Second, there must be “significant conflict” be-
tween the federal interests and state law. 1 Id. at 507.
1
Defendants argue that this test for creating federal common law does not apply and that the
Court has jurisdiction if “plaintiff has stated a viable federal claim.” ECF No. 51 at 29. In sup-
port, they cite only a case from the First Circuit, United States v. Swiss Am. Bank, Ltd., 191 F.3d
30, 42–45 (1st Cir. 1999), but that case is inapt. There, the plaintiff brought asset forfeiture
claims in federal court based on federal common law theories. Id. at 42. Thus, state law was not
in the picture, and the court only had to address whether the plaintiff had a cognizable claim un-
der federal common law. The court did not address the dispositive question here: whether there
is “significant conflict” between a state law claim and federal interests such that the state law
claim cannot exist.
4
Defendants use almost all their opposition to argue that the District’s claims “implicate”
three uniquely federal interests: interstate pollution, the navigable waters of the United States, and
foreign affairs. Fair enough. 2 But even so, their argument fails because they have not shown a
“significant conflict” between the District’s claims under the Act and a federal interest they iden-
tify. See O’Melveny & Myers v. FDIC, 512 U.S. 79, 88 (1994) (failing to show “significant con-
flict” is “fatal” to federal common law argument). Simply put, they do not engage with this prong
of the federal common law test. See, e.g., ECF No. 51 at 29 (arguing only that the District’s claims
“implicate” federal interests). They do not, for example, sufficiently describe actual conflict be-
tween the Act’s protections against misleading advertising and federal interests in regulating
“transboundary pollution.” Nor do they explain how the District’s false-advertising claims conflict
with federal interests in regulating the navigable waters or in foreign affairs. Defendants do not
even use the phrase “significant conflict” in their opposition. Several courts have found this short-
coming dispositive, and the Court agrees with their reasoning. See, e.g., Mayor and City Council
v. BP P.L.C., 31 F.4th 178, 202 (4th Cir. 2022) (defendants’ failure to establish significant conflict
“substantively precludes the creation of federal common law”); Rhode Island v. Shell Oil Prods.
Co., LLC, 35 F.4th 44, 54–56 (1st Cir. 2022) (explaining that defendants do not “adequately de-
scribe” the significant conflict between federal interests and the state law claims).
The closest Defendants come to identifying any such conflict is by reference to a case in
the Southern District of New York. There, the court granted the defendants’ motion to dismiss
under Rule 12(b)(6) and held that New York City’s nuisance claims could not proceed under state
2
The Court assumes, without deciding, that Defendants have identified “uniquely federal inter-
ests” to satisfy the first part of the federal common law test. See Mayor and City Council v. BP
P.L.C., 31 F.4th 178, 202 (4th Cir. 2022); Rhode Island v. Shell Oil Prods. Co., LLC, 35 F.4th
44, 54 (1st Cir. 2022).
5
law because federal common law preempted them. See City of New York v. BP P.L.C., 325 F.
Supp. 3d 466, 471 (S.D.N.Y. 2018), aff’d sub nom. City of New York v. Chevron Corp., 993 F.3d
81 (2d Cir. 2021). But that case has limited relevance here; it involved an ordinary preemption
defense at the motion-to-dismiss stage. The case was also brought in federal court, so removal
was not at issue. Thus, the trial court never considered whether federal common law completely
preempted any state law pollution claims and justified removal of a state-law claim. The Second
Circuit recognized the importance of this procedural posture in its affirmance, explaining that it
was considering the “preemption defense on its own terms, not under the heightened standard
unique to the removability inquiry.” City of New York v. Chevron Corp., 993 F.3d at 94 (emphasis
added). In any event, Defendants do not explain how that case shows “significant conflict” be-
tween the District’s false advertising claims and the federal interests they identify, nor do they
engage in the extensive analysis the Supreme Court has undertaken in its past cases to determine
whether significant conflict exists. See, e.g., Atherton, 519 U.S. at 216–19; Boyle, 487 U.S. at
511–12. On this score, the Court is aligned with at least three courts of appeals. 3 See BP P.L.C.,
31 F.4th at 202–03; Shell Oil, 35 F.4th at 55; Bd. of Cnty. Comm’rs. v. Suncor Energy (U.S.A.)
3
Defendants also seek to rely on American Electric Power Co. v. Connecticut (“AEP”), 564 U.S.
410 (2011), to support their argument that federal common law governing “transboundary pollu-
tion” claims governs the District’s claims, see ECF No. 51 at 31–32. That case does not help them.
In AEP, the plaintiffs asserted nuisance claims under federal common law in federal court, and the
Supreme Court held that Congress had displaced the federal common law in this area with the
Clean Air Act. See AEP, 564 U.S. at 424. Under AEP, it is unclear how the District’s claims could
arise under federal common law in this area if those “federal law claim[s] [have] been deemed
displaced, extinguished, and rendered null by the Supreme Court.” BP P.L.C., 31 F.4th at 206.
The Court cannot find that the District’s claims arise under federal common law “based on a non-
existent theory of federal common law when its viability is ‘no longer open to discussion.’” BP
P.L.C., 31 F.4th at 207 (quoting Hagans v. Levine, 415 U.S. 528, 537 (1974)).
6
Inc., 25 F.4th 1238, 1262 (10th Cir. 2022). Federal common law does not apply to the District’s
claims.
Even if federal common law applied here, though, Defendants hit another roadblock: the
well-pleaded complaint rule, which limits federal-question jurisdiction. The rule mandates that
“the federal question must appear on the face of a well-pleaded complaint and may not enter in
anticipation of a defense.” Verlinden B.V. v. Cent. Bank of Nigeria, 461 U.S. 480, 494 (1983).
The rule applies both to the Court’s original jurisdiction and a defendant’s ability to remove a case
on federal-question grounds under 28 U.S.C. § 1441. See Franchise Tax Bd. v. Constr. Laborers
Vacation Tr. for S. Cal., 463 U.S. 1, 10 n.9 (1983). The plaintiff is therefore the “master of the
claim” and may “avoid federal jurisdiction by exclusive reliance on state law” when drafting its
complaint. Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987). Federal-question jurisdiction
does not exist if defendants raise a defense rooted in federal law. See, e.g., Aetna Health Inc. v.
Davila, 542 U.S. 200, 207 (2004).
Defendants argue that the well-pleaded complaint rule does not apply here. And indeed,
there are exceptions to this general rule. One is the doctrine of complete preemption. Sometimes,
a “federal statute completely preempts the state law cause of action,” and the claim, “even if
pleaded in terms of state law, is in reality based on federal law.” Beneficial Nat. Bank v. Anderson,
539 U.S. 1, 8 (2003). Federal courts therefore have jurisdiction over that claim because “the
preemptive force of [the] statute is so extraordinary that it converts an ordinary state-law complaint
into one stating a federal claim for purposes of the well-pleaded complaint rule.” Caterpillar, 482
U.S. at 493. This scenario is rare; the Supreme Court has recognized complete preemption in the
cases of only three federal statutes. See Beneficial, 539 U.S. at 6–11. Complete preemption differs
from ordinary preemption, which is a defense that “forecloses a plaintiff from stating a legally
7
cognizable claim for recovery” based on state law. Sickle v. Torres Advanced Enter. Sols., LLC,
884 F.3d 338, 345 (D.C. Cir. 2018). An ordinary preemption defense does not create federal-
question jurisdiction. See Caterpillar, 482 U.S. at 398–99.
Defendants say that “federal common law exclusively governs claims for interstate and
international pollution because the Constitution dictates that ‘state law cannot be used.’” ECF No.
51 at 38 (quoting City of Milwaukee v. Illinois and Michigan, 451 U.S. 304, 314 n.7 (1981)).
Although Defendants skillfully avoid using the term “complete preemption,” they effectively ar-
gue for a “new form of complete preemption”—mandated by the Constitution, they say—rooted
in federal common law. City of Hoboken v. Chevron Corp., 45 F.4th 699, 707 (3d Cir. 2022).
True, as described above, complete preemption is an exception to the well-pleaded complaint rule.
But the Supreme Court has only recognized complete preemption in the context of federal statutes.
See City of Hoboken, 45 F.4th at 707. And even then, the Supreme Court has recognized it only
three times. See id. Defendants furnish no authority suggesting that the federal common law can
“transform” a state law claim into a federal one. Caterpillar, 482 U.S. at 399. This is unsurprising,
given that complete preemption requires a “clear and manifest purpose” from Congress—some-
thing unavailable from a judge-made federal common law rule. City of Milwaukee, 451 U.S. at
316. Two courts of appeals have ended similar removal inquiries there, and the Court finds that
reasoning persuasive as well. See City of Hoboken, 45 F.4th at 708 (“So because [the defendants]
have no statute, they have no removal jurisdiction either.”); Suncor, 25 F.4th at 1262 (“[B]ecause
the federal common law does not completely preempt state law, removal is not warranted . . . .”).
Of course, Defendants may eventually invoke a preemption defense when challenging the merits
of the District’s claim. But the Court is aware of no authority holding that the existence of a federal
common law claim completely preempts any state law claim on that topic and “transform[s]” any
8
state claim into a federal one, “thereby selecting the forum in which the claim shall be litigated.”
Caterpillar, 482 U.S. at 399.
B. Removal is Improper Under Grable
Defendants contend that removal is proper because the District’s claims necessarily raise
a disputed and substantial federal question under Grable. ECF No. 51 at 39. Grable says that in
rare circumstances, federal-question jurisdiction exists even if a complaint fails the well-pleaded
complaint rule. Grable & Sons Metal Prods., Inc. v. Darue Eng’g & Mfg., 545 U.S. 308, 313–14
(2005)). Under this doctrine, “federal jurisdiction over a state law claim will lie if a federal issue
is: (1) necessarily raised, (2) actually disputed, (3) substantial, and (4) capable of resolution in
federal court without disrupting the federal-state balance approved by Congress.” Gunn v. Minton,
568 U.S. 251, 258 (2013). Because exercising this jurisdiction approaches “the outer reaches of
§ 1331,” Merrell Dow Pharm. v. Thompson, 478 U.S. 804, 810 (1986), the Supreme Court has
repeatedly characterized the cases satisfying this test as a “slim category,” Gunn, 568 U.S. at 258;
Empire Healthchoice Assurance., Inc. v. McVeigh, 547 U.S. 677, 701 (2006).
For a federal issue to be “necessarily raised,” it must be an “essential element” of the state-
law claim. D.C. Ass’n of Chartered Pub. Schools v. District of Columbia, 930 F.3d 487, 491 (D.C.
Cir. 2019) (quoting Grable, 545 U.S. at 315). Courts exercising Grable jurisdiction identify a
precise federal issue and explain why that issue is necessary to resolve the state law claim. See,
e.g., Grable, 545 U.S. at 310 (state law quiet-title suit requiring interpretation of Internal Revenue
Code’s notice requirement); Gunn, 568 U.S. at 259 (state legal-malpractice claim required appli-
cation of federal patent law); Bender v. Jordan, 623 F.3d 1128, 1130–31 (D.C. Cir. 2010) (state
breach-of-contract claim required interpretation of federal regulation); District of Columbia v. Grp.
Hosp. and Med. Servs., 576 F. Supp. 2d 51, 54–55 (D.D.C. 2008) (state-law claims required de-
termination whether defendants violated their congressional charter).
9
Nothing similar is present here. In sum, Defendants have identified no disputed federal
issue necessary to resolve the District’s consumer protection claims. 4 They argue that the Dis-
trict’s “theory of deception” implicates a slew of federal interests, including the federal govern-
ment’s regulatory framework on climate issues, national policies balancing energy production with
environmental protection, and foreign affairs. ECF No. 51 at 40–43. Even so, Defendants merely
explain purported benefits of federal jurisdiction; they do not point to any “nearly pure question
of federal law” necessary to adjudicate the District’s claims. Bender, 623 F.3d at 145. For exam-
ple, Defendants cite the Clean Air Act and other federal regulations to argue that “Congress has
already weighed the costs and benefits of fossil fuels” and thus it is “essential” that the District’s
claims are resolved in federal court. ECF No. 51 at 42. They similarly contend that allowing the
District to proceed in state court would “disrupt the principles of federalism.” Id. at 47. But the
District’s claims under the Act—that Defendants misled consumers about the effects of fossil
fuels—can be adjudicated without a court resolving any questions of federal law. Defendants may
raise these federalism concerns as a preemption defense later, but such a defense does not create
federal-question jurisdiction. See Suncor, 25 F.4th at 1266.
Other courts have declined to exercise Grable jurisdiction in similar circumstances. See
Shell Oil, 35 F.4th at 56–57; BP P.L.C., 31 F.4th at 208–215; Suncor, 25 F.4th at 1267. Simply
put, Defendants identify no question involving any federal statute, regulation, or other federal issue
necessarily raised for the District to prevail under the Act, and “speaking about federal law or
federal concerns in the most generalized way is not enough for Grable purposes.” Shell Oil, 35
4
The District’s claims under the Act require that Defendants misrepresent goods or services to
consumers within the District; misrepresent a material fact that has a tendency to mislead; or fail
to state a material fact if that failure tends to mislead. See D.C. Code § 28-3904(a), (e), (f).
10
F.4th at 57. The Court therefore finds that Grable jurisdiction does not lie, and removal is not
proper on that ground. 5
C. The Court Does Not Have Federal Enclave Jurisdiction
Defendants argue that some of Defendants’ alleged unlawful conduct occurred within fed-
eral enclaves—including military installations such as Fort Lesley J. McNair, and monuments and
parks controlled by the National Park Service—and therefore the Court has exclusive jurisdiction
over the District’s claims under the Constitution. ECF No. 51 at 47. They also argue that by
“targeting” Defendants’ oil and gas operations, the District’s claims “necessarily sweep[ ] in those
operations that occur on military bases and other federal enclaves.” Id. at 48.
The Constitution authorizes Congress “[t]o exercise exclusive Legislation in all Cases
whatsoever . . . over all Places purchased . . . for the Erection of Forts, Magazines, Arsenals,
Dock-Yards, and other needful Buildings.” U.S. Const. art. I, § 8, cl. 17. Known as the “Enclave
Clause,” courts have “generally read [the clause] to establish federal subject matter jurisdiction
over tort claims occurring on federal enclaves . . . even when applying state law.” Jograj v. Enter.
Servs., LLC, 270 F. Supp. 3d 10, 16 (D.D.C. 2017). In other words, “federal law applies to a legal
controversy arising on federal enclaves” and “a court has jurisdiction over such a claim under
§ 1331.” Cnty. of San Mateo v. Chevron Corp., 32 F.4th 733, 749 (9th Cir. 2022). Exclusive
federal jurisdiction remains “unless reserved or authorized by Congress.” Thomas v. Securiguard
Inc., 412 F. Supp. 3d 62, 74 (D.D.C. 2019) (citing Goodyear Atomic Corp. v. Miller, 486 U.S. 174,
181 (1988)).
5
Defendants must satisfy “all four” requirements under Grable to establish federal-question ju-
risdiction on this theory. Gunn, 568 U.S. at 258. Because Defendants fail on prong one, the
Court need not address the other three. See, e.g., Shell Oil, 35 F.4th at 56.
11
The question here is whether the Enclave Clause confers federal jurisdiction when some of
the pertinent activity occurred on a federal enclave but some did not. 6 Neither party cites any
binding authority on this question, and another court in this District has characterized the law in
this area as “not entirely settled.” Jograj, 270 F. Supp. 3d at 16; see City of Roseville v. Norton,
219 F. Supp. 2d 130, 150 (D.D.C. 2002) (“There is scarce case law interpreting the enclaves
clause.”). But several courts of appeals addressing the question in analogous litigation have held
that federal enclave jurisdiction requires “that all pertinent events take place on a federal enclave.”
Suncor, 25 F.4th at 1271 (cleaned up); see BP P.L.C., 31 F.4th at 217–19; Shell Oil, 35 F.4th at
58; see also Cnty. of San Mateo, 32 F.4th at 750 (finding that connection between alleged conduct
and federal enclaves “too attenuated and remote” to establish subject-matter jurisdiction). Con-
sistent with this principle, the Supreme Court has held that Indian reservations are federal enclaves
only with respect to conduct that happened wholly within the reservation. See Nevada v. Hicks,
533 U.S. 353, 361–62, 365 (1990) (holding that jurisdiction under Enclaves Clause only lies for
“on-reservation conduct involving only Indians” and that “State sovereignty does not end at a res-
ervation’s border”). Courts in this District have similarly considered the question of federal-en-
clave jurisdiction only when the relevant conduct or injury occurred entirely within a purported
federal enclave. See, e.g., Youssef, 2021 WL 3722742, at *11.
6
Defendants do not appear to argue that federal-enclave jurisdiction lies because the entire District
of Columbia itself is a federal enclave. See Youssef v. Embassy of the United Arab Emirates,
No. 17-cv-2638 (KBJ), 2021 WL 3722742, at * 11 (D.D.C. Aug. 23, 2021) (The “District of Co-
lumbia is neither a state nor a territory, but a federal enclave itself.” (cleaned up)). And there does
not appear to be any support for such a view. Although the District of Columbia is a federal
creation, Congress effectively delegated governance to local authorities through the Home Rule
Act of 1973. See United States v. Simmons, No. 18-cr-344 (EGS), 2022 WL 1302888, at *2
(D.D.C. May 2, 2022). Thus, unlike in the case of a state and a federal enclave within its bounda-
ries, in general, “the federal enclave doctrine does not apply to limit the applicability of D.C. laws
with respect to entities located in the District.” See Youssef, 2021 WL 3722742, at * 11.
12
That is not the case here. The District alleges that Defendants’ false advertising affected
consumers across the District of Columbia. See, e.g., ECF No. 1-14 at 29. It also alleges that the
resulting injures—a cascade of environmental harms—occurred throughout the District of Colum-
bia. See ECF No. 1-14 at 11–12. Again, Defendants seem to concede that the District’s allegations
pertain to activity across the District of Columbia, even if some of that activity happened in a
federal enclave. And Defendants do not argue that anything especially significant happened in a
federal enclave that did not occur elsewhere. Thus, as several other courts have in similar circum-
stances, this Court declines to find that federal enclave jurisdiction is appropriate.
D. Removal is Improper Under the Outer Continental Shelf Lands Act
Defendants contend that the Court has jurisdiction over the District’s claims under the
Outer Continental Shelf Lands Act (“OCSLA”). OCSLA provides original jurisdiction for “cases
and controversies arising out of, or in connection with . . . any operation conducted on the outer
Continental shelf.” 43 U.S.C. § 1349(b). They argue that the District’s claims arise in connection
with their offshore drilling operations, which are “operations” under OCSLA, and because the
District’s false advertising allegations “necessarily sweep[ ] in Defendants’ activities on” the outer
continental shelf. ECF No. 51 at 67. The District says that Defendants’ interpretation of OCSLA
is too broad. It contends that Defendants’ false advertising, which caused the injury, is not an
“operation” under OCSLA, and that any offshore drilling was not the “but for” cause of the Dis-
trict’s injury. ECF No. 63 at 26. The District has the better argument.
The D.C. Circuit has not interpreted the limits of OCSLA’s jurisdictional grant. Thus, the
parties—and other courts addressing the question—have turned to the Fifth Circuit for guidance.
To establish jurisdiction under OCSLA, a party must show that “(1) the activities that caused the
injury constituted an ‘operation’ ‘conducted on the outer Continental Shelf’ that involved the ex-
ploration and production of minerals, and (2) the case ‘arises out of, or in connection with’ the
13
operation.” In re Deepwater Horizon, 745 F.3d 157, 163 (5th Cir. 2014). In defining the second
requirement, the Fifth Circuit requires an operation on the outer Continental Shelf to be the “but-
for” cause of the plaintiff’s injuries. See In re Deepwater Horizon, 745 F.3d at 163; see also BP
P.L.C., 31 F.4th at 220; Suncor, 25 F.4th at 1272–75; but see Cnty. of San Mateo, 32 F.4th at 754
(declining to require “but-for” causation). And although § 1349(b)(1) is a “broad” jurisdictional
provision, Texaco Expl. & Prod., Inc. v. AmClyde Engineered Prods. Co., 448 F.3d 760, 768 (5th
Cir. 2006), a “mere connection” between operations on the outer Continental Shelf and a plaintiff’s
injury will not establish jurisdiction if the connection is “too remote,” In re Deepwater Horizon,
745 F.3d at 163.
Defendants’ alleged false advertising and misleading information campaigns are not “op-
eration[s]” under OCSLA, even if those acts somehow relate to their offshore drilling. See EP
Operating Ltd. P’ship v. Placid Oil Co., 26 F.3d 563, 567 (5th Cir. 1994) (“The term ‘operation’
contemplate[s] the doing of some physical act on the [outer Continental Shelf].”). Nor have De-
fendants shown that their activity on the outer Continental Shelf was the “but-for” cause of the
District’s claims. Defendants’ allegedly misleading newspaper advertisements, biased scientific
studies, and misstatements about green energy gave rise to the District’s suit, and are independent
of any of Defendants’ technical operations on the outer Continental Shelf. Put another way, “irre-
spective of Defendants’ activities on the [outer Continental Shelf],” the District’s “injuries still
exist as a result of that distinct marketing conduct.” BP P.L.C., 31 F.4th at 221. 7 Unlike cases
7
Defendants’ argument for removal under OCSLA would fail even under the Ninth Circuit’s mi-
nority approach, which does not require “but-for” causation. In San Mateo, that court held that
any connection between the alleged injuries and the outer Continental Shelf was “too attenu-
ated,” because the plaintiffs’ alleged injuries were “exclusively within their local jurisdictions”
and none of the alleged wrongdoing occurred on the outer Continental Shelf. San Mateo, 32
F.4th at 754–55.
14
involving “direct connections” to activity on the outer Continental Shelf, such as “collision, death,
personal injury, loss of wildlife, [or] toxic exposure,” the District’s suit does not present a “nexus”
between its injuries and offshore operations. Suncor, 25 F.4th at 1273 (citing Barker v. Hercules
Offshore, Inc., 713 F.3d 208, 213 (5th Cir. 2013)).
Defendants argue that, in the end, the District’s suit targets their extensive operations on
the outer Continental Shelf. But the First, Third, Fourth, Ninth, and Tenth circuits have all rejected
the argument that such a remote connection can establish jurisdiction under OCSLA. See Shell
Oil, 35 F.4th at 59–60; City of Hoboken, 45 F.4th at 712; BP P.L.C., 31 F.4th at 219–22; Cnty. of
San Mateo, 32 F.4th at 751–54; Suncor, 25 F.4th at 1272–75. They have done so for good reason:
Adopting Defendants’ approach would allow essentially any lawsuit related to fossil fuels to be
removed under OCSLA. See Shell Oil, 35 F.4th at 60. The Court agrees that even though section
1349(b)’s jurisdictional grant is broad, removal under the provision is inappropriate because the
District’s false advertising allegations under the Act “bear a weak relationship” to any activity on
the outer Continental Shelf. BP P.L.C., 31 F.4th at 222.
E. The Federal Officer Removal Statute Does Not Apply
Defendants argue that removal is appropriate under the federal officer removal statute.
This law allows removal of a civil action against “[t]he United States or any agency thereof or any
officer (or any person acting under that officer) of the United States or of any agency thereof.” 28
U.S.C. § 1442(a)(1). 8 This statute operates as an exception to the well-pleaded complaint rule.
See Mesa v. California, 489 U.S. 121, 136 (1989). To remove under the federal-officer removal
statute, Defendants must show that they were “acting under” the direction of the federal govern-
ment, that there is a “nexus” or “causal connection” between the asserted federal authority and the
8
The District does not contest that Defendants are each a “person” for purposes for § 1442.
15
conduct at issue, and that they can allege a “colorable” federal defense to the District’s claims. See
Jefferson Cnty. v. Acker, 527 U.S. 423, 431 (1999); Kormendi/Gardner Partners v. Surplus Ac-
quisition Venture, LLC, 606 F. Supp. 2d 114, 119 (D.D.C. 2009). The District does not challenge
Defendants’ ability to satisfy the third requirement.
As for the first requirement, Defendants argue that through various contracts and agree-
ments, “the federal government directed Defendants to engage in activities related to” the District’s
claims, and that Defendants have “acted under the direction” of the federal government when de-
veloping fossil fuel products. ECF No. 51 at 51–52. As for the second, they say the District’s
claims are sufficiently “connected or associated” with the fossil fuel activity they undertook at the
behest of the federal government. Id. at 52.
Not so. Even if Defendants acted under the federal government’s direction “for decades,”
as they say, ECF No. 51 at 65, Defendants have failed to show “a nexus” or “causal connection”
between “the charged conduct and the asserted official authority.” K&D LLC v. Trump Old Post
Office, LLC, 951 F.3d 503, 507 (D.C. Cir. 2020) (quoting Acker, 527 U.S. at 431). 9 The “charged
conduct” here is Defendants’ false advertising—not fossil fuel production en masse. Put another
way, the agreements between Defendants and the federal government do not require the alleged
false advertising and misleading representations that gave rise to the District’s claims. See, e.g.,
Shell Oil, 35 F.4th at 53 n.6 (holding that federal-officer removal statute did not apply because the
defendants’ contracts with the federal government “mandate[d] none of those activities”). True,
the injuries the District’s alleges—in short, climate change—eventually trace back to fossil fuel
9
The Court expresses no view on whether Defendants’ activities related to the development of
fossil fuel products qualify as actions taken “under the direction” of the federal government. The
Court notes, however, that the Fourth and Tenth Circuits found that similar activity fell short of
that requirement. See BP P.L.C., 31 F.4th at 230–32; Suncor, 25 F.4th at 1250–54.
16
usage. But “the source of tort liability,” according to the District, is not Defendants’ production
of fossil fuels but the “concealment and misrepresentation of the products’ known dangers.” BP
P.L.C., 31 F.4th at 233.
Thus, the Court cannot find that there is a sufficient nexus between any action Defendants
may have taken under federal direction and the alleged false advertising that gave rise to the Dis-
trict’s claims. Removal under § 1442 is therefore unavailable to Defendants.
F. The Court Does Not Have Diversity Jurisdiction Over the Parties
Defendants contend that removal is proper because complete diversity exists between the
parties. They say that the parties are diverse because the Court should consider the citizenship of
the District’s citizens, who are the real parties in interest. The District argues that it sued on its
own behalf to protect sovereign interests distinct from the private interests of any individual citi-
zen. Again, the District has the better argument.
The diversity statute requires complete diversity, so all plaintiffs must be diverse from all
defendants in a lawsuit. 28 U.S.C. § 1332(a); Lincoln Prop. Co. v. Roche, 546 U.S. 81, 89 (2005).
Ordinarily, the “District of Columbia, like a state, is not a citizen of a state (or of itself) for diversity
purposes.” Barwood, Inc. v. District of Columbia, 202 F.3d 290, 292 (D.C. Cir. 2000). But when
a state is “merely a nominal party” rather than the true party in interest, diversity jurisdiction may
exist. Hood v. F. Hoffman-La Roche, Ltd., 639 F. Supp. 2d 25, 33 (D.D.C. 2009); see also Navarro
Sav. Ass’n v. Lee, 446 U.S. 458, 461 (1980) (“A federal court must disregard nominal or formal
parties and rest jurisdiction only upon the citizenship of real parties to the controversy.”).
Both parties agree that to establish more than a “nominal interest,” the District must show
a “quasi-sovereign interest” and allege an injury “to a sufficiently substantial segment of its pop-
ulation” rather than a discrete injury to a “group of individual residents.” Alfred L. Snapp & Son,
Inc. v. Puerto Rico ex rel. Barez, 458 U.S. 592, 607 (1982). The Act itself makes clear that the
17
District has a “quasi-sovereign interest” in prosecuting consumer protection violations. 10 To
begin, it authorizes the District to sue “in the public interest” generally, not on behalf of individual
or discrete groups of citizens. D.C. Code § 28-3909(a). The Act also distinguishes between suits
brought by the District and those brought by private citizens. For example, the District may seek
civil penalties paid to the District’s treasury, while private citizens may seek only ordinary dam-
ages. Compare D.C. Code § 28-3903(b) with D.C. Code § 28-3905(k)(2). The District may also
seek an injunction for violations of the Act without proving damages, which a private citizen may
not do. Compare D.C. Code § 28-3909(a) with D.C. Code § 28-3905(k)(2)(D). Nor does the Act
impose a statute of limitations on claims that the District may bring, but it does require a private
citizen to bring similar claims within three years. Compare D.C. Code § 28-3909 with D.C. Code
§ 28-3905(d)(1). These distinctions make clear that the District has its own “pecuniary interest in
this lawsuit” distinct from the private financial interests of individual citizens. District of Colum-
bia ex rel. Am. Combustion, Inc. v. Transamerica Ins. Co., 797 F.2d 1041, 1047 (D.C. Cir. 1986).
Put another way, the District seeks redress of its own injuries and may recover for violations of
the Act apart from any recovery individual citizens seek. Cf. id. (finding no “pecuniary interest”
where state government sued but damages were awarded to private individuals).
There is also little doubt that the District’s alleged injuries affect both the District itself and
a “sufficiently substantial segment of its population.” Id. Alleged rising sea levels, destruction of
property, and other consequences of climate change fit that bill. For their part, Defendants argue
10
Other courts have recognized a state’s sovereign interest in preventing false advertising and
unfair trade practices in similar circumstances. See, e.g., Nessel ex rel. Michigan v. AmeriGas
Partners, 954 F.3d 831, 835 (6th Cir. 2020) (“The Attorney General brings this lawsuit in order to
vindicate the State’s sovereign and quasi-sovereign interest in deterring Defendants from engaging
in unfair trade practices . . . .”); Nevada v. Bank of Am. Corp., 672 F.3d 661, 670 (9th Cir. 2012)
(holding that a state “has a specific, concrete interest in eliminating any deceptive practices that
may have contributed to” a housing crisis).
18
that the District sued on behalf of a discrete group of citizens, but they do not make clear what that
group is and why that group has been injured while other citizens have not.
Defendants have failed to establish that the District is merely a “nominal party” and that
the Court should consider its citizens as the real parties in interest. Because the District is not
diverse from Defendants, the Court therefore lacks diversity jurisdiction under § 1332.
G. The Class Action Fairness Act Does Not Apply
Defendants argue that they may remove the case because it satisfies the requirements of
the Class Action Fairness Act (“CAFA”). They essentially argue that the District’s suit is a class
action, and the citizens of the District are the class. See ECF No. 51 at 72. They also say that
because the District seeks “restitution and damages” for violating the Act, the District is effectively
representing a class of private citizens rather than its own interests.
“CAFA provides the federal district courts with ‘original jurisdiction’ to hear a ‘class ac-
tion’ if the class has more than 100 members, the parties are minimally diverse, and the ‘matter in
controversy exceeds the sum or value of $5,000,000.’” Standard Fire Ins. Co. v. Knowles, 568
U.S. 588, 592 (2013) (quoting 28 U.S.C. § 1332(d)). Defendants’ arguments fall short at the first
requirement: They cannot show that this is a “class action.” For reasons already discussed, the
District has a sovereign interest in prosecuting consumer protection claims and may sue under the
Act on its own behalf. The Act says nothing about the District suing on behalf of “class” or initi-
ating a “class action.” Defendants’ attempt to recast the District’s suit as a class action is therefore
unpersuasive, even if the suit were brought “in the public interest” generally. D.C. Code § 28-
3909(a).
Other courts in this District have reached the same conclusion in a similar context. Along
with suits brought by the District, the Act allows individuals to bring “private attorney general
suits” where “[a] person, whether acting for the interests of itself, its members, or the general
19
public” may “seek[ ] relief from the use by any person of a trade practice in violation of a law of
the District of Columbia.” See D.C. Code § 28–3905(k)(1). Courts have held that such a suit is
not a class action under CAFA because it is “authorized by District of Columbia statute and is a
separate and distinct procedural vehicle from a class action.” See Breakman v. AOL LLC, 545 F.
Supp. 2d 96, 101 (D.D.C. 2008); see also Stein v. Am. Exp. Travel Related Servs., 813 F. Supp. 2d
69, 73 (D.D.C. 2011) (citing Breakman and collecting cases). The same reasoning applies with
even more force to suits brought by the District, given its sovereign interest in preventing consumer
protection violations.
The cases Defendants rely on are unpersuasive. One does not relate to CAFA jurisdiction
at all. See Song v. Charter Commc’ns Inc., No. 17-cv-325 (JLB), 2017 WL 1149286 (S.D. Cal.
Mar. 28, 2017). The other is a District of Columbia case involving a suit under the Act, but the
court had no occasion to determine whether a federal court would have jurisdiction under CAFA.
See Rotunda v. Marriott Int’l, Inc., 123 A.3d 980, 989 (D.C. 2015). Nor did that suit involve a
government-initiated enforcement suit. See id. At bottom, Defendants cite no authority—and the
Court is aware of none—supporting the proposition that the District’s consumer protection suit
constitutes a “class action” under CAFA.
Conclusion
For all the above reasons, the Court will grant the District’s motion to remand. A separate
order will issue.
/s/ Timothy J. Kelly
TIMOTHY J. KELLY
United States District Judge
Date: November 12, 2022
20 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483368/ | Case: 22-10403 Document: 00516542289 Page: 1 Date Filed: 11/11/2022
United States Court of Appeals
for the Fifth Circuit
United States Court of Appeals
Fifth Circuit
No. 22-10403
Summary Calendar FILED
November 11, 2022
Lyle W. Cayce
United States of America, Clerk
Plaintiff—Appellee,
versus
Jason Tout-Puissant,
Defendant—Appellant.
Appeal from the United States District Court
for the Northern District of Texas
USDC No. 3:18-CR-625-1
Before Higginbotham, Graves, and Ho, Circuit Judges.
Per Curiam:*
The attorney appointed to represent Jason Tout-Puissant has moved
for leave to withdraw and has filed a brief in accordance with Anders v.
California, 386 U.S. 738 (1967), and United States v. Flores, 632 F.3d 229 (5th
Cir. 2011). Tout-Puissant has not filed a response. We have reviewed
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 22-10403 Document: 00516542289 Page: 2 Date Filed: 11/11/2022
No. 22-10403
counsel’s brief and the relevant portions of the record reflected therein. We
concur with counsel’s assessment that the appeal presents no nonfrivolous
issue for appellate review. Accordingly, counsel’s motion for leave to
withdraw is GRANTED, counsel is excused from further responsibilities
herein, and the APPEAL IS DISMISSED. See 5th Cir. R. 42.2.
2 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483372/ | Case: 21-60926 Document: 00516542325 Page: 1 Date Filed: 11/11/2022
United States Court of Appeals
for the Fifth Circuit
United States Court of Appeals
Fifth Circuit
No. 21-60926
Summary Calendar FILED
November 11, 2022
Lyle W. Cayce
Angel Gabriel Reyes, Clerk
Petitioner,
versus
Merrick Garland, U.S. Attorney General,
Respondent.
Petition for Review of an Order of the
Board of Immigration Appeals
Agency No. A087 895 515
Before Higginbotham, Graves, and Ho, Circuit Judges.
Per Curiam:*
Angel Gabriel Reyes, a native and citizen of Honduras, petitions us for
review of a decision of the Board of Immigration Appeals upholding the
Immigration Judge’s denial of his withholding of removal claims.
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 21-60926 Document: 00516542325 Page: 2 Date Filed: 11/11/2022
No. 21-60926
On petition for review of a Board decision, this court reviews factual
findings for substantial evidence and questions of law de novo. Lopez-Gomez
v. Ashcroft, 263 F.3d 442, 444 (5th Cir. 2001). The substantial-evidence
standard applies to review of decisions denying withholding of removal.
Zhang v. Gonzales, 432 F.3d 339, 344 (5th Cir. 2005). This standard requires
that the Board’s conclusion be based on the evidence presented and that its
decision be substantially reasonable. Id. Under this standard, reversal is
improper unless the evidence compels a contrary conclusion. Carbajal-
Gonzalez v. INS, 78 F.3d 194, 197 (5th Cir. 1996). When the Board adopts
the Immigration Judge’s decision without assigning reasons, as it did here,
this court reviews the Immigration Judge’s decision. Zhu v. Gonzales, 493
F.3d 588, 593 (5th Cir. 2007).
We are not compelled to find that Reyes should have been found
credible. The Immigration Judge’s finding that the initial application
contained essentially a different claim than the supplemental application is
supported by the record. See Morales v. Sessions, 860 F.3d 812, 817 (5th Cir.
2017). The credibility finding is dispositive of the claim so analysis of the
findings on corroborative evidence is unnecessary. INS v. Bagamasbad, 429
U.S. 24, 25-26 (1976).
DENIED.
2 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483378/ | USCA4 Appeal: 16-7671 Doc: 61 Filed: 11/10/2022 Pg: 1 of 10
PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 16-7671
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
CECIL MCDONALD DAVIS,
Defendant - Appellant.
Appeal from the United States District Court for the Eastern District of Virginia, at
Alexandria. T.S. Ellis, III, Senior District Judge. (1:94−cr−00370−TSE−1; 1:16–cv–
00832–TSE)
Argued: September 13, 2022 Decided: November 10, 2022
Before NIEMEYER and WYNN, Circuit Judges, and FLOYD, Senior Circuit Judge.
Reversed and remanded by published opinion. Judge Wynn wrote the opinion, in which
Judge Niemeyer and Senior Judge Floyd joined.
ARGUED: Laura Allison Herzog, LATHAM & WATKINS, LLP, Washington, D.C., for
Appellant. Aidan Taft Grano-Mickelsen, OFFICE OF THE UNITED STATES
ATTORNEY, Richmond, Virginia, for Appellee. ON BRIEF: Jessica D. Aber, United
States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Richmond, Virginia,
for Appellee.
USCA4 Appeal: 16-7671 Doc: 61 Filed: 11/10/2022 Pg: 2 of 10
WYNN, Circuit Judge:
Cecil McDonald Davis filed a motion under 28 U.S.C. § 2255, challenging his 18
U.S.C. § 924(c) conviction for using a destructive device in furtherance of a crime of
violence. The district court denied his motion and Davis appealed. Because we conclude
that the federal arson statute which served as the predicate for Davis’s § 924(c) conviction
is not categorically a crime of violence, we reverse and remand for further proceedings.
I.
Much of the background for this case is laid out in a prior opinion. United States v.
Davis, 98 F.3d 141 (4th Cir. 1996). We briefly recount the relevant facts here.
In December 1993, Davis conspired with Tiffini Fairfax and Walter Langston to get
revenge on Brenda Williams for Williams’s suspected cooperation with a federal drug
investigation. The initial plan was for Langston to pour gasoline on Williams’s back porch,
“set the gasoline on fire, and leave a gas can filled with gasoline on the porch to go off like
a bomb.” Id. at 143. This attempt failed. Two days later, the group was more successful.
This time, Langston threw a Molotov cocktail onto Williams’s porch, which exploded and
scorched a section of the exterior wall. Although three people were in the house at the time,
no one was injured and the fire did not spread beyond the back porch. On both occasions,
Davis paid Langston for his efforts.
Davis was subsequently indicted on four counts: conspiracy to commit arson in
violation of 18 U.S.C § 371 (Count 1); attempted arson in violation of 18 U.S.C § 844(f)
(Count 2); arson in violation of 18 U.S.C. § 844(f) (Count 3); and use of a destructive
2
USCA4 Appeal: 16-7671 Doc: 61 Filed: 11/10/2022 Pg: 3 of 10
device in furtherance of a crime of violence in violation of 18 U.S.C. § 924(c) (Count 4).
The indictment listed Count 3, the arson conviction, as the predicate crime of violence to
support Davis’s § 924(c) conviction. Davis proceeded to trial where a jury found him guilty
on all four counts. Thereafter, the district court imposed a total sentence of 480 months:
120 months on Counts 1–3 to run concurrently and, after the court expressed concern about
the length of the sentence but concluded it was legally bound to impose it, 360 months on
Count 4 to run consecutively with the other sentences.
We affirmed. Id. Davis then filed his first motion under 28 U.S.C. § 2255, which
the district court denied. We again affirmed. United States v. Davis, 13 F. App’x 68 (4th
Cir. 2001) (per curiam).
In June 2016, we granted Davis authorization to file a successive § 2255 motion on
the basis of Johnson v. United States, which held that the residual clause of the Armed
Career Criminal Act was unconstitutionally vague. 576 U.S. 591, 597 (2015). Davis then
filed his second § 2255 motion, which is now before the Court. In the present motion, Davis
challenges his § 924(c) conviction, arguing that, after Johnson, his federal arson conviction
under § 844(f) is not a crime of violence to sustain his § 924(c) conviction.
The district court denied the motion. United States v. Davis, No. 1:16-CV-832, 2016
WL 11257359 (E.D. Va. Sept. 28, 2016). First, the district court ruled that Davis’s motion
was untimely filed, holding that Johnson did not start a new limitations period for filing
§ 2255 motions that challenged § 924(c) convictions. Id. at *3–4. The district court also
held, in the alternative, that federal arson under § 844(f) was categorically a crime of
violence that could support a § 924(c) conviction. Id. at *5.
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Davis timely appealed. We initially granted the certificate of appealability only on
the issue of timeliness, but later expanded the certificate to include Davis’s claim that his
§ 924(c) conviction was not supported by a proper predicate conviction.
II.
On appeal, the Government affirmatively waived any challenge to timeliness.
Government’s Br. at 8. So the sole question left for review is whether Davis’s § 844(f)
arson conviction categorically qualifies as a crime of violence to sustain his § 924(c)
conviction. We review de novo whether an offense qualifies as a crime of violence. United
States v. Mathis, 932 F.3d 242, 263 (4th Cir. 2019).
A.
Section 924(c) prohibits the use of a firearm “during and in relation to any crime of
violence or drug trafficking crime.” 18 U.S.C. § 924(c)(1)(A). A “firearm” is statutorily
defined to include a “destructive device,” which is further defined to include “any
explosive, incendiary, or poison gas.” 18 U.S.C. § 921(a)(3)–(4). Davis does not dispute
that a Molotov cocktail is a “destructive device.”
Under the statutory scheme, a defendant can “be convicted of both the underlying
‘crime of violence’ and the additional crime of utilizing a [destructive device] in connection
with” such a crime. United States v. Taylor, 979 F.3d 203, 206 (4th Cir. 2020), aff’d, 142
S. Ct. 2015 (2022). A “crime of violence” is, in turn, defined as a felony offense that “(A)
has as an element the use, attempted use, or threatened use of physical force against the
person or property of another” or “(B) that by its nature, involves a substantial risk that
physical force against the person or property of another may be used in the course of
4
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committing the offense.” 18 U.S.C. § 924(c)(3). But the Supreme Court has found
subsection (B) to be unconstitutionally vague. United States v. Davis, 139 S. Ct. 2319, 2336
(2019). So, to sustain Davis’s conviction on Count 4, his § 844(f) arson charge must qualify
as a crime of violence under subsection (A), often referred to as the “force clause.”
We employ the categorical approach to determine whether an offense is a crime of
violence under the force clause. Taylor, 979 F.3d at 207. The categorical approach “focuses
on the elements of the prior offense rather than the conduct underlying the conviction” and
asks whether those elements “necessarily require ‘the use, attempted use, or threatened use
of physical force.’” Id. (quoting § 924(c)) (citations omitted). If the least culpable conduct
punished by the underlying offense can be committed without such use, it “is not
‘categorically’ a ‘crime of violence.’” Id. Still, “there must be a realistic probability, not
[just] a theoretical possibility, that the minimum conduct would actually be punished under
the statute.” United States v. Allred, 942 F.3d 641, 648 (4th Cir. 2019) (quotations and
citation omitted).
B.
While the categorical approach has its close cases, its application here is
straightforward. The force clause of § 924(c) prohibits “the use, attempted use, or
threatened use of physical force against the person or property of another.” 18 U.S.C.
§ 924(c)(3)(A) (emphasis added). By its terms, the force clause does not reach the use of
physical force against property solely owned by the defendant. It is for this reason that the
Supreme Court, in interpreting a substantially similar definition of “crime of violence” in
18 U.S.C. § 16(a), has concluded that many state arson laws would not constitute crimes
5
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of violence to the extent these laws define arson “to include the destruction of one’s own
property.” 1 Torres v. Lynch, 578 U.S. 452, 466 (2016). Likewise, this Court, in an
unpublished opinion, held that federal arson under the neighboring provision of 18 U.S.C.
§ 844(i) was not a crime of violence for § 924(c) purposes since it applied to attempts to
“damage or destroy ‘any building, vehicle, or other real or personal property used in
interstate . . . commerce,’” thus including the “destruction of a defendant’s own property.”
United States v. Wilder, 834 F. App’x 782, 784 (4th Cir. 2020) (per curiam) (quoting 18
U.S.C. § 844(i)).
This is enough to resolve the case here. Section 844(f), the predicate offense, could
easily encompass force against a defendant’s own property. Although it has since been
amended, at the time of Davis’s conviction in 1994, § 844(f) applied to anyone who
maliciously damages or destroys . . . by means of fire or an explosive, any
building, vehicle, or other personal or real property in whole or in part owned,
possessed, or used by, or leased to, the United States, any department or
agency thereof, or any institution or organization receiving Federal financial
assistance[.]
18 U.S.C. § 844(f) (1994). 2 This version of § 844(f) swept broadly. It applied not just to
property that was wholly or partially “owned,” “possessed,” or “leased” by the United
States, a federal agency, or any organization receiving federal aid, but also to property that
1
Like § 924(c)(3)(A), 18 U.S.C. § 16(a) defines a “crime of violence” to mean “an
offense that has as an element the use, attempted use, or threatened use of physical force
against the person or property of another.”
2
In 1996, after Davis’s conviction, the statute was modified to no longer include
the phrase “used by.” Antiterrorism and Effective Death Penalty Act of 1996 (AEDPA),
Pub. L. No. 104-132, § 708(a)(2), 110 Stat. 1214, 1296.
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was merely “used by” the same. In other words, an individual who wholly owned a property
and simply let a qualifying federal organization use it could be liable under § 844(f) if the
individual maliciously damaged that property using fire or an explosive.
Such was the case in United States v. Koen, 982 F.2d 1101 (7th Cir. 1992), holding
modified on other grounds by United States v. Coleman, 22 F.3d 126 (7th Cir. 1994). In
that case, the Seventh Circuit upheld an arson conviction under § 844(f) when an
individual, Charles Koen, destroyed a building that he “wholly owned” because a business
that he founded “operated out” of the building and received federal funds. Id. at 1104. Koen
was thus convicted under § 844(f) for arson against a building he owned—not one “of
another,” as is required for a crime to serve as a § 924(c) predicate.
At oral argument in this matter, the Government acknowledged that it faced an
“uphill” climb to demonstrate that property that is merely “used by” the federal government
falls within the ambit of § 924(c). Oral Argument at 3:52, United States v. Davis, No. 16-
7671 (4th Cir. Sept. 13, 2022), https://www.ca4.uscourts.gov/OAarchive/mp3/16-7671-
20220913.mp3. To attempt to overcome that hurdle, the Government argues that § 844(f)
arson always involves the property “of another” because it is limited to property owned,
possessed, used by, or leased to the United States, federal agencies, or organizations
receiving federal funds. Government’s Br. at 18. Put differently, the Government seeks to
limit § 844(f) to “arson against any organizational property, a qualification that by
definition removes the possibility that an individual can set fire to his own property in
which no other person or legal entity has any interest.” Id. (quotations omitted). But the
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plain text of the statute does not use the phrase “organizational property.” It instead
encompasses property merely “used by” an organization receiving federal funds. 3
The reach of this provision is demonstrated by the facts of this case. Davis’s victim,
Williams, rented her townhouse from a private entity. Davis, 98 F.3d at 145. Williams also
received financial assistance from the Virginia Housing Development Authority
(“VHDA”), which in turn received federal funding from the U.S. Department of Housing
and Urban Development. Id. In affirming Davis’s conviction, we held that the financial
assistance provided by the VHDA to Williams was “sufficient evidence for the jury to
determine that the VHDA used Miss Williams’ house.” Id. If Davis himself, rather than
Williams’s landlord, had owned the townhouse, he would have certainly still been liable
under the 1994 version of § 844(f) because he committed arson against a property “used
by” an “organization receiving Federal financial assistance,” the VHDA. But as the owner
of the townhouse in this hypothetical, he would not have committed arson against the
property “of another.” And if there was any doubt that the Government would prosecute in
such a situation, the Seventh Circuit’s decision in Koen demonstrates that it has done so in
the past.
3
The Government also argues that “of” is “a broad word, encompassing a wide
range of relationships between its subject and object,” including mere possession.
Government’s Br. at 21 n.5. The implication, which goes unstated, appears to be that
property that is merely used by another becomes the property “of another.” We need not
sketch out the full contours of what would constitute the “property of another” for purposes
of § 924(c). To resolve this case, it is enough to observe that the plain language of the
statute envisions a form of ownership and not mere use. See Reply Br. at 6 (“If Alcoholics
Anonymous holds its meetings in a church basement . . . no one would say the church
becomes ‘the property of AA.’ AA is merely using the church building.”).
8
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Section 844(f)’s reference to property “used by” the federal government also
distinguishes this case from our prior decision in Mbea v. Gonzales, 482 F.3d 276 (4th Cir.
2007), on which the district court relied. In Mbea, we held that a D.C. arson statute
qualified as a categorical crime of violence under 18 U.S.C. § 16(a). Id. at 280. Although
the “crime of violence” definitions in § 16(a) and § 924(c) are nearly identical, the arson
statutes at issue are not. The D.C. statute made it an offense to commit arson against “the
property, in whole or in part, of another person, or any church, meetinghouse, schoolhouse,
or any of the public buildings in the District, belonging to the United States or to the
District of Columbia.” D.C. Code Ann. § 22-401 (1994) (emphasis added). 4 Critically, the
D.C. statute expressly required the property at issue to belong to another person, the United
States, or the District of Columbia. The 1994 version of § 844(f) did not. That distinction
is dispositive.
Because the version of § 844(f) that Davis was convicted under criminalized the
arson of property fully owned by the defendant, and not just that of the property “of
another” as required by § 924(c), it is not categorically a crime of violence. 5 It therefore
cannot serve as the predicate crime for Davis’s § 924(c) conviction.
4
The statute has since been recodified as D.C. Code Ann. § 22-301.
5
Davis also argues that § 844(f) is not a crime of violence because it can be
committed with a mens rea of recklessness. Opening Br. at 24–28. Since we find that the
1994 version of § 844(f) is not a crime of violence because it could encompass arson
against the defendant’s own property, we need not reach Davis’s mens rea argument.
9
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III.
For the foregoing reasons, we reverse the district court’s denial of Davis’s § 2255
motion. We remand for further proceedings consistent with this opinion.
REVERSED AND REMANDED
10 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483376/ | USCA4 Appeal: 20-2321 Doc: 21 Filed: 11/10/2022 Pg: 1 of 5
UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 20-2321
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
SHERMARQUETTE WHITAKER,
Claimant - Appellant,
and
$35,990.00 IN U.S. CURRENCY,
Defendant.
Appeal from the United States District Court for the Eastern District of North Carolina, at
Elizabeth City. Malcolm J. Howard, Senior District Judge. (2:17-cv-00002-H)
Submitted: September 15, 2022 Decided: November 10, 2022
Before KING and AGEE, Circuit Judges, and TRAXLER, Senior Circuit Judge.
Affirmed by unpublished per curiam opinion.
ON BRIEF: Deborrah L. Newton, NEWTON LAW, Raleigh, North Carolina, for
Appellant. G. Norman Acker, III, Acting United States Attorney, Matthew L. Fesak,
Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY,
USCA4 Appeal: 20-2321 Doc: 21 Filed: 11/10/2022 Pg: 2 of 5
Raleigh, North Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
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PER CURIAM:
Shermarquette Whitaker appeals the district court’s grant of summary judgment in
favor of the Government in a civil forfeiture proceeding and the court’s judgment ordering
forfeiture of $35,990 in United States currency. Finding no error, we affirm.
“We review the district court’s grant of summary judgment de novo and construe
all facts and reasonable inferences therefrom in favor of the nonmoving party.” United
States v. McClellan, 44 F.4th 200, 205 (4th Cir. 2022) (cleaned up). Summary judgment
is appropriate only “if the movant shows that there is no genuine dispute as to any material
fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). “The
relevant inquiry on summary judgment is whether the evidence presents a sufficient
disagreement to require submission to a jury or whether it is so one-sided that one party
must prevail as a matter of law.” United States v. 8.929 Acres of Land in Arlington Cnty.,
36 F.4th 240, 252 (4th Cir. 2022) (internal quotation marks omitted). In opposing summary
judgment, “the nonmoving party must rely on more than conclusory allegations, mere
speculation, the building of one inference upon another, or the mere existence of a scintilla
of evidence.” Id. (internal quotation marks omitted).
Civil forfeiture standards are set forth in the Civil Asset Forfeiture Reform Act of
2000, Pub. L. No. 106-185, 114 Stat. 202. See 18 U.S.C. § 983. The statute provides that
the Government must demonstrate by a preponderance of the evidence that the property
sought is subject to forfeiture. 18 U.S.C. § 983(c)(1), (2); McClellan, 44 F.4th at 205.
“Property is subject to forfeiture if it either facilitated the transportation, sale, receipt,
possession, or concealment of a controlled substance, or was intended to do so, or
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constitutes proceeds of drug-trafficking activities.” McClellan, 44 F.4th at 205 (citing 21
U.S.C. § 881(a)(6)). Furthermore, “if the Government’s theory of forfeiture is that the
property was used to commit or facilitate the commission of a criminal offense, or was
involved in the commission of a criminal offense, the Government shall establish that there
was a substantial connection between the property and the offense.” 18 U.S.C. § 983(c)(3);
McClellan, 44 F.4th at 205. In civil forfeiture proceedings, “we review a district court’s
factual findings for clear error” and review de novo the court’s legal determination
regarding whether the facts render the defendant property subject to forfeiture. United
States v. Kivanc, 714 F.3d 782, 789 (4th Cir. 2013).
With these standards in mind, we have reviewed the joint appendix and the parties’
briefs and—contrary to Whitaker’s assertion on appeal—conclude that the district court
properly found the Government established by a preponderance of the evidence that the
subject currency had a substantial connection to drug trafficking. Although Whitaker
argues that the Government cannot establish a substantial connection between the currency
and a criminal offense because he was not convicted of any crime with respect to the seizure
of the currency, a conviction is not required for a civil forfeiture. See United States v.
Louthian, 756 F.3d 295, 307 n.12 (4th Cir. 2014) (explaining that while “criminal forfeiture
is an in personam action that requires a conviction, civil forfeiture is an in rem action
against the property itself”); United States v. Cherry, 330 F.3d 658, 668 n.16
(4th Cir. 2003) (“[C]ivil forfeiture proceedings are brought against property, not against
the property owner; the owner’s culpability is irrelevant in deciding whether property
should be forfeited.”).
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Whitaker also argues that there were genuine disputes as to the source of the seized
currency, whether he was connected to the home where the currency was found, and
whether he was engaged in drug trafficking. Because this was a civil forfeiture proceeding,
Whitaker’s culpability and connection to the home where the currency was found are not
material facts. See Cherry, 330 F.3d at 668 n.16. As for the source of the currency,
Whitaker alleged that he won the money in the lottery. However, only a portion of
Whitaker’s lottery winnings were adequately documented, the lottery receipts were dated
over a year and half before the seizure of the currency, Whitaker purchased a car
immediately after winning the lottery, he spent $10,000 to $15,000 per year on lottery
tickets, and he had not been employed since 2006. Based on these facts, the district court
appropriately concluded that there was no genuine dispute as to the source of the money.
See 8.929 Acres of Land in Arlington Cnty., 36 F.4th at 252; Libertarian Party of Va. v.
Judd, 718 F.3d 308, 313 (4th Cir. 2013) (explaining that “[a] dispute is genuine if a
reasonable jury could return a verdict for the nonmoving party” (internal quotation marks
omitted)).
Accordingly, we affirm the judgment of the district court. We dispense with oral
argument because the facts and legal contentions are adequately presented in the materials
before this court and argument would not aid the decisional process.
AFFIRMED
5 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483380/ | USCA4 Appeal: 22-1130 Doc: 30 Filed: 11/10/2022 Pg: 1 of 7
UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 22-1130
TODD BOWERS,
Plaintiff – Appellant,
v.
INTERNATIONAL BROTHERHOOD OF BOILERMAKERS, IRON SHIP
BUILDERS, BLACKSMITHS, FORGERS, AND HELPERS AFL-CIO,
Defendant – Appellee.
Appeal from the United States District Court for the Northern District of West Virginia, at
Martinsburg. Gina M. Groh, District Judge. (3:21−cv−00089−GMG)
Submitted: October 3, 2022 Decided: November 10, 2022
Before WILKINSON, WYNN, and DIAZ, Circuit Judges.
Affirmed by unpublished per curiam opinion.
ON BRIEF: Christian J. Riddell, THE RIDDELL LAW GROUP, Martinsburg, West
Virginia, for Appellant. Jason R. McClitis, Brandon E. Wood, Jordan L. Glasgow, BLAKE
& UHLIG, P.A., Kansas City, Kansas, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
USCA4 Appeal: 22-1130 Doc: 30 Filed: 11/10/2022 Pg: 2 of 7
PER CURIAM:
Todd Bowers, a longtime member of the International Brotherhood of Boilermakers
(IBB), started his own welding business and entered into a collective-bargaining agreement
with the union before the relationship soured. After he sued IBB in West Virginia state
court, IBB removed the case based on the Labor Management Relations Act’s creation of
exclusive federal jurisdiction over cases arising from collective-bargaining agreements.
Bowers appeals the district court’s dismissal of his case with prejudice and its denial of his
motion to remand. For the following reasons, we affirm.
I.
Bowers was a member of an IBB local lodge who founded his own welding
business, Elite Mechanical. J.A. 14. He entered into a collective-bargaining agreement with
IBB—the Ohio Valley Agreement (OVA)—wherein IBB would provide Bowers with
certified boilermakers and Bowers would employ boilermakers exclusively through the
OVA and make payments into IBB’s pension and retirement programs. Id. at 14–15.
At some point in or around 2017, the relationship between Bowers and IBB soured
based, in part, on Bowers’s hiring of a boilermaker who had been expelled by the union.
Id. at 15. Bowers also attempted to withdraw from the OVA. Id. In early 2020, IBB’s
pension funds filed a lawsuit against Bowers alleging that he had not properly remitted
contributions to the funds for work performed by OVA-covered employees. Id. at 168–76.
Bowers filed a counterclaim reciting substantially identical claims to those set forth in the
instant case. Id. at 120–25. The parties jointly dismissed their claims. Id. at 210.
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Bowers filed the complaint at issue in this appeal on February 19, 2021, in West
Virginia state court. Id. at 14. The complaint alleges that IBB plotted to take reprisals
against Bowers for hiring non-union labor, competing with IBB boilermakers for general
welding work, and pulling out of the OVA. Id. at 15–16. It alleges that IBB tried to harass,
intimidate, and put Bowers out of business by “filing meritless lawsuits,” demanding
compensation and threatening legal action for post-2017 work, “[t]hreatening and
harassing” Bowers’s employees to “coerce them into leaving [his] employ,” and “[f]alsely
reporting” him to “relevant oversight organizations.” Id. at 16. The complaint includes five
counts: (1) “tortious interference of business,” (2) abuse of process, (3) intentional
infliction of emotional distress, (4) violation of W. Va. Code § 61-2-13(a) [criminal
extortion], and (5) violation of W. Va. Code § 61-2-9a [criminal harassment]. Id. at 16–18.
IBB removed the case to federal court. Id. at 6. It asserted that because Bowers’s
claims are “directly based on the terms of the collective bargaining agreement or
substantially dependent on” analysis of it, the Labor Management Relations Act (LMRA)
provides for exclusive federal jurisdiction over the complaint. Id. at 8 (citing 29 U.S.C.
§ 185(a)). IBB also moved to dismiss, arguing that (1) the LMRA preempts Bowers’s
claims, (2) the claims are time-barred by the LMRA’s statute of limitations, (3) Bowers
failed to exhaust required contractual remedies, (4) no civil cause of action exists for
Bowers’s West Virginia statutory claims, and (5) the complaint lacks sufficient factual
allegations to state a claim. Id. at 138. Bowers moved to remand the case back to state
court. Id. at 212–21.
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The district court dismissed the case with prejudice and denied Bowers’s motion to
remand. Bowers v. Int’l Bhd. of Boilermakers, No. 3:21-CV-89, 2022 WL 421145, at *6
(N.D. W. Va. Jan. 20, 2022). It concluded that every asserted basis in IBB’s motion to
dismiss warranted dismissal. Id. at *2. Nothing in the complaint “c[ame] close to alleging
a factual basis to support a lawsuit,” West Virginia’s criminal statutes created no private
right of action, and the LMRA preempted the suit because evaluating Bowers’s claims
would require the court “to consider and interpret the OVA at great length.” Id. at *2–4.
Even if Bowers had properly alleged claims under the LMRA, he had failed to exhaust his
contractual remedies, and those claims would be time-barred. Id. at *5–6.
Bowers raises numerous assignments of error. We conclude that none has merit.
II.
First, Bowers argues that the district court lacked subject-matter jurisdiction because
his claims did not sufficiently relate to any collective-bargaining agreement under the
LMRA, so his complaint raises no federal question. We review de novo whether the district
court had subject-matter jurisdiction. See Foy v. Giant Food Inc., 298 F.3d 284, 287 (4th
Cir. 2002). We conclude that the district court had jurisdiction because § 301 of the LMRA
preempts Bowers’s claims.
Section 301 of the LMRA completely preempts state law, and any claim so
preempted “is considered, from its inception, a federal claim, and therefore arises under
federal law.” Caterpillar Inc. v. Williams, 482 U.S. 386, 393 (1987). Removal of such
claims is therefore proper. See id.; 28 U.S.C. § 1441(a). The LMRA preempts a state-law
claim “when resolution of the claim requires the interpretation of a collective-bargaining
4
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agreement or is inextricably intertwined with consideration of the terms of the labor
contract.” Foy, 298 F.3d at 287 (quotation marks and citations omitted).
Bowers’s claims are “inextricably intertwined with consideration of the terms of”
the OVA. His claim for tortious interference of business depends on whether he was
violating the terms of the OVA’s exclusive-referral provision and whether IBB was within
its rights under the OVA’s jobsite-access provision to talk to and try to convince his
employees to leave. See J.A. 39 (exclusive-referral provision), 55 (jobsite-access
provision). Resolution of this claim requires interpretation and application of these
provisions. Bowers’s abuse-of-process claim depends on whether IBB’s funds filed
meritless lawsuits, and that question is inextricably intertwined with consideration of the
OVA’s provisions governing employer contributions. See id. at 60–67. And Bowers’s
claim for intentional infliction of emotional distress closely parallels the claim that we held
preempted in Foy: Such a claim “requires an inquiry into whether [IBB] was legally
entitled to act as [it] did,” which “can be determined only by interpreting the collective
bargaining agreement.” 298 F.3d at 288 (quotation marks omitted).
Thus, the Labor Management Relations Act preempted Bowers’s claims and
established federal jurisdiction over his case.
III.
Next, Bowers contends that the district court erred in concluding that Counts Four
and Five fail to state a claim because the West Virginia criminal statutes do not create a
private cause of action. Whether a statute creates a private cause of action is a question of
law subject to de novo review. See Diaz de Gomez v. Wilkinson, 987 F.3d 359, 363 (4th
5
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Cir. 2021). It is clear that the West Virginia criminal-extortion and criminal-harassment
statutes, §§ 61-2-13(a) and 61-2-9a, do not create private causes of action.
In West Virginia, whether a private cause of action exists based on a violation of a
statute is determined by applying the four-part test set forth in Hurley v. Allied Chemical
Corporation, 262 S.E.2d 757 (W. Va. 1980). This test considers (1) whether the plaintiff
is a member of the statute’s intended class of beneficiaries, (2) whether there exists express
or implied legislative intent to create a private cause of action, (3) whether a private cause
of action is consistent with the statutory scheme, and (4) whether a private cause of action
would intrude into exclusively federal areas. Hurley, 262 S.E.2d at 763.
Here, §§ 61-2-13(a) and 61-2-9a are criminal statutes “enacted for the protection of
the general public;” they do not “expressly identif[y]” a class they intend to benefit. Id. at
761 (quotation marks omitted). Moreover, the plain language of these statutes—and other
statutes in the same chapter—provides only for criminal penalties; neither the statutory text
nor scheme suggests any intent to create a private cause of action. So, these criminal
statutes do not create private causes of action. Counts Four and Five failed to state a claim.
IV.
Finally, Bowers argues that we lack appellate jurisdiction because the district court
dismissed his suit without giving him an opportunity to amend his complaint and did not
certify that the complaint’s deficiencies could not be cured by amendment. We disagree.
We have jurisdiction because this is an appeal of a dismissal with prejudice, which
is a final decision of the district court. See 28 U.S.C. § 1291; Harrison v. Edison Bros.
Apparel Stores, Inc., 924 F.2d 530, 534 (4th Cir. 1991). Bowers never properly moved to
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amend his complaint, so the district court was not required to offer him the opportunity to
amend. See J.A. 1–5; Cozzarelli v. Inspire Pharms. Inc., 549 F.3d 618, 630–31 (4th Cir.
2008) (holding that a request for leave to amend made in a response to a motion to dismiss
“did not qualify as [a] motion[] for leave to amend” under Fed. R. Civ. P. 7(b), 15(a)).
Moreover, amendment would have been futile: Even if Bowers had properly stated claims
under the LMRA, those claims would have been time-barred by the applicable six-month
statute of limitations and precluded by his failure to exhaust his remedies under the
collective-bargaining agreement. See Smith v. United Parcel Serv., Inc., 776 F.2d 99, 100
(4th Cir. 1985) (statute of limitations); Republic Steel Corp. v. Maddox, 379 U.S. 650, 652–
53 (1965) (exhaustion requirement).
V.
We have reviewed Bowers’s other assignments of error and find them to be without
merit. For the foregoing reasons, the judgement is affirmed.
AFFIRMED
7 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483379/ | USCA4 Appeal: 21-4373 Doc: 44 Filed: 11/10/2022 Pg: 1 of 3
UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 21-4373
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
CARLTON KERNEL SHERRILL,
Defendant - Appellant.
Appeal from the United States District Court for the Western District of North Carolina, at
Charlotte. Frank D. Whitney, District Judge. (3:19-cr-00408-FDW-DSC-1)
Submitted: October 31, 2022 Decided: November 10, 2022
Before HARRIS and RUSHING, Circuit Judges, and FLOYD, Senior Circuit Judge.
Affirmed by unpublished per curiam opinion.
ON BRIEF: Charles Robinson Brewer, Asheville, North Carolina, for Appellant. Anthony
Joseph Enright, Assistant United States Attorney, Charlotte, North Carolina, Amy
Elizabeth Ray, Assistant United States Attorney, OFFICE OF THE UNITED STATES
ATTORNEY, Asheville, North Carolina, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
USCA4 Appeal: 21-4373 Doc: 44 Filed: 11/10/2022 Pg: 2 of 3
PER CURIAM:
Carlton Kernel Sherrill pleaded guilty, pursuant to a written plea agreement, to
possessing a firearm as a convicted felon, in violation of 18 U.S.C. § 922(g)(1), and
distribution of and possession with intent to distribute cocaine, in violation of 21 U.S.C.
§ 841(a)(1), (b)(1)(C). The district court sentenced Sherrill to a downward variance of 120
months’ imprisonment. Sherrill’s sole argument on appeal is that he received
constitutionally ineffective assistance of counsel related to both his plea and sentencing.
The Government has moved to dismiss the appeal on the ground that the record does not
conclusively establish that counsel was ineffective and therefore Sherrill’s claims are not
cognizable on direct appeal. Sherrill opposes the Government’s motion. For the following
reasons, we deny the Government’s motion but affirm the criminal judgment.
To demonstrate constitutionally ineffective assistance of counsel, a defendant must
establish both deficient performance and prejudice. Strickland v. Washington, 466 U.S.
668, 687-88, 692 (1984). An attorney’s performance is deficient if “counsel made errors
so serious that counsel was not functioning as the ‘counsel’ guaranteed the defendant by
the Sixth Amendment.” Id. at 687. We “must indulge a strong presumption that counsel’s
conduct falls within the wide range of reasonable professional assistance; that is, the
defendant must overcome the presumption that, under the circumstances, the challenged
action might be considered sound trial strategy.” Id. at 689 (internal quotation marks
omitted). To establish prejudice, “[t]he defendant must show that there is a reasonable
probability that, but for counsel’s unprofessional errors, the result of the proceeding would
have been different. A reasonable probability is a probability sufficient to undermine
2
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confidence in the outcome.” Id. at 694. To show prejudice in the guilty plea context, a
defendant claiming ineffective assistance “must demonstrate a reasonable probability that,
but for counsel’s errors, he would not have pleaded guilty and would have insisted on going
to trial.” Christian v. Ballard, 792 F.3d 427, 443-44 (4th Cir. 2015) (internal quotation
marks omitted).
Claims of ineffective assistance of counsel are cognizable on direct appeal “only
where the record conclusively establishes ineffective assistance.” United States v. Baptiste,
596 F.3d 214, 216 n.1 (4th Cir. 2010). Generally, a defendant should instead raise
ineffectiveness claims in a 28 U.S.C. § 2255 motion, to permit sufficient development of
the record. Id.; see Massaro v. United States, 538 U.S. 500, 504-06 (2003).
Sherrill argues that his counsel’s performance was deficient in three respects. He
contends that counsel failed to move to suppress the firearm and drug evidence, failed to
review the presentence report with him, and failed to challenge the factual basis as
insufficient to support his guilty plea to the drug charge. We have reviewed the record and
conclude that it does not conclusively establish Sherrill’s claim that he received ineffective
assistance of counsel. See Baptiste, 596 F.3d at 216 n.1. Therefore, this claim is not
cognizable on direct appeal.
Accordingly, we deny the Government’s motion to dismiss but affirm the criminal
judgment. We dispense with oral argument because the facts and legal contentions are
adequately presented in the materials before this court and argument would not aid the
decisional process.
AFFIRMED
3 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483377/ | USCA4 Appeal: 21-4295 Doc: 50 Filed: 11/10/2022 Pg: 1 of 7
UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 21-4295
UNITED STATES OF AMERICA,
Plaintiff – Appellee,
v.
HERBERT ANTHONY SLOAN, a/k/a Kool Breeze,
Defendant – Appellant.
Appeal from the United States District Court for the Eastern District of North Carolina, at
Wilmington. James C. Dever III, District Judge (7:19−cr−00150−D−1)
Submitted: October 3, 2022 Decided: November 10, 2022
Before WILKINSON and WYNN, Circuit Judges, and FLOYD, Senior Circuit Judge.
Affirmed by unpublished per curiam opinion.
ON BRIEF: Anne Margaret Hayes, Cary, North Carolina, for Appellant. Michael F.
Easley, Jr., United States Attorney, David A. Bragdon, Assistant United States Attorney,
Lucy Partain Brown, Assistant United States Attorney, OFFICE OF THE UNITED
STATES ATTORNEY, Raleigh, North Carolina, For Appellee.
Unpublished opinions are not binding precedent in this circuit.
USCA4 Appeal: 21-4295 Doc: 50 Filed: 11/10/2022 Pg: 2 of 7
PER CURIAM:
Herbert Anthony Sloan pleaded guilty to a felon in possession charge under 18
U.S.C. § 922(g)(1) and was sentenced to 120 months in prison. On appeal, he argues that
the district court erred by applying an obstruction of justice sentence enhancement pursuant
to U.S.S.G. § 3C1.1, and a sentence enhancement for possession of a firearm during the
commission of another felony pursuant to U.S.S.G. § 2k2.1(b)(6)(B). Because the district
court did not err in applying these enhancements and because any error would otherwise
be harmless, we affirm. We also deny Sloan’s motion to file a supplemental brief raising,
for the first time, a challenge to his base offense level.
I.
On July 13, 2019, a woman called the 911 operator in Wilmington, North Carolina,
indicating that there was a man with a gun at her mother’s residence who was not allowing
her mother to leave. 1 J.A. 37. This man, later identified as Sloan, wanted to see the
daughter, but instead entered the house and the mother’s bedroom after not finding her.
J.A. 41–43. Sloan shut the mother’s bedroom door behind him, pulled up his shirt, and told
the mother that he had a gun. J.A. 43. He then showed her the gun in his lap and asked
where the daughter’s bedroom was. J.A. 41–43. Sloan went to the bedroom, then returned
to the mother’s room and again showed her his gun. J.A. 43–44. He stood at the door in a
way that made the mother feel as if she could not get past him to leave. J.A. 44. During this
1
The district court referred to the victims involved in this case as “the mother” and
“the daughter” to preserve anonymity. We continue that convention on appeal.
2
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incident, the mother was sending text messages to the daughter, stating that Sloan was at
her residence, that “[i]t was not good over here,” and that she was apprehensive about his
weapon. J.A. 127–28.
After Sloan was located and detained, the mother texted the daughter that “if he
brought a gun i[]n twice he was going to use it…I have a feeling it was going to be me or
you and the way he was talking is going to be me[.]” J.A. 129–31. He was charged in state
court with possession of a firearm by a felon, possession of marijuana, carrying a concealed
weapon, and second-degree kidnapping. J.A. 110. On August 12, 2019, Sloan called the
daughter from jail and said that the police “had no choice but to lock [him] up because
somebody called and said [he] had a gun to their f’ing baby head and to their mama head.
Who the ‘f’ did that?” J.A. 70. Sloan said he wanted the daughter to “[g]et the bullshit off
[him]” and “[g]et [him] out of this because you the only one that can get [him] out of this.”
J.A. 50. The daughter’s impression of this call was that Sloan wanted her to get the charges
dropped. J.A. 74.
Sloan was charged federally in September 2019 on one count of being a felon in
possession of a firearm in violation of 18 U.S.C. § 922(g)(1), to which he later pleaded
guilty. J.A. 13, 26. The presentence investigation report (PSR) calculated Sloan’s base
offense level at 24 due to prior controlled substance offenses. J.A. 161. Sloan’s counsel
objected to a four-level sentence enhancement for use of a firearm in connection with
another felony offense under U.S.S.G. § 2K2.1(b)(6)(B) and a two-level sentence
enhancement for obstruction of justice under U.S.S.G. § 3C1.1. J.A. 164–65.
3
USCA4 Appeal: 21-4295 Doc: 50 Filed: 11/10/2022 Pg: 4 of 7
The district court sentenced Sloan to the statutory maximum of 120 months,
overruling these objections. J.A. 87, 93, 99. The court identified the applicable felony for
the § 2K2.1(b)(6)(B) enhancement as North Carolina second-degree kidnapping, which
required the confinement of an individual for the “purpose of…terrorizing a person so
confined.” J.A. 86 (citing N.C. Gen. Stat § 14–39(a)(3)). The district court “absolutely”
found that the record, including the text messages, showed by a preponderance of the
evidence that Sloan intended to terrorize the mother when he trapped her in her bedroom
and pulled out his gun. J.A. 86. As for the obstruction of justice enhancement, the court
found by a preponderance of the evidence that Sloan’s conduct during the August 12 phone
call was a “willful…attempt to obstruct the administration of justice with respect to [an]
investigation [or] prosecution” as he was asking the victims to change their story regarding
“his possession of a weapon and how he used the weapon that night in connection with
terrorizing the mother.” J.A. 92–93. After considering the 18 U.S.C. § 3553(a) factors and
Sloan’s criminal history, the court sentenced him to the statutory maximum. J.A. 99. It then
noted that it would have “impose[d] the same sentence as an alternative variance sentence”
because “this is the sentence sufficient but not greater than necessary with respect to
[Sloan] in light of the entire record.” J.A. 101.
II.
Sloan appeals the district court’s determination as to the two sentence
enhancements. This court reviews a sentence imposed by the district court for
reasonableness under a deferential abuse-of-discretion standard. Gall v. United States, 552
U.S. 38, 41 (2007). In reviewing the district court’s application of the Guidelines and its
4
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imposition of a sentencing enhancement, “we review [its] legal conclusions de novo and
its factual findings for clear error.” United States v. Layton, 564 F.3d 330, 334(4th Cir.
2009). We will “find clear error only if, on the entire evidence, [we are] left with the
definite and firm conviction that a mistake has been committed.” United States v. Manigan,
592 F.3d 621, 631 (4th Cir. 2010) (internal quotation marks omitted) (alteration in
original). Facts supporting a Guidelines enhancement must be proven by a preponderance
of the evidence. United States v. Andrews, 808 F.3d 964, 968 (4th Cir. 2015).
The district court did not err in adopting the four-level sentence enhancement for
use of a firearm in connection with another felony offense. See U.S.S.G. § 2K2.1(b)(6)(B).
The district court determined that Sloan’s actions constituted felonious second-degree
kidnapping under North Carolina law, which is confinement of someone “for the purpose
of…terrorizing a person so confined.” N.C. Gen. Stat. § 14-39(a)(3). Terrorizing a person
is “putting that person in some high degree of fear, or a state of intense fright or
apprehension.” State v. Moore, 314 N.C. 738, 745, 340 S.E.2d 401, 405 (1986) (internal
quotation marks omitted). Such an intent may be inferred from the evidence. Id. The record
amply supports the court’s finding that Sloan had the requisite intent to terrorize. The text
messages and other evidence show that Sloan confined the mother to her own room and
pulled out his weapon to convey the implicit threat that “it was going to be [the mother] or
[the daughter].” J.A. 131. As the district court found, Sloane “pull[ed] out a gun to get what
he want[ed], to wit, the daughter.” J.A. 81. This shows an intent to terrorize by a
preponderance of the evidence, and any argument to the contrary is unavailing.
5
USCA4 Appeal: 21-4295 Doc: 50 Filed: 11/10/2022 Pg: 6 of 7
The district court also did not err in adopting the two-level sentence enhancement
for obstruction of justice. Such an enhancement is appropriate when “the defendant
willfully obstructed or impeded, or attempted to obstruct or impede, the administration of
justice with respect to the investigation, prosecution, or sentencing of the instant offense
of conviction” and “the obstructive conduct related to…the defendant’s offense of
conviction” or “a closely related offense.” USSG § 3C1.1. “[O]bstructive conduct can vary
widely in nature, degree of planning, and seriousness,” but may include “threatening,
intimidating, or otherwise unlawfully influencing a…witness…, directly or indirectly, or
attempting to do so.” Id. cmt. n 3, n. 4(A). The record supports the district court’s finding
that Sloan’s conduct was obstructive. The August 12 phone call attempted to get the
witnesses to change their story regarding Sloan’s use of his gun. As the daughter stated,
this conveyed the impression that he wanted her to drop charges. Thus, the two-level
enhancement was proper.
Moreover, any error made by the district court is harmless. A Guidelines error is
harmless– and, thus, does not warrant reversal– if “(1) the district court would have reached
the same result even if it had decided the [G]uidelines issue the other way, and (2) the
sentence would be reasonable even if the [G]uidelines issue had been decided in the
defendant’s favor.” United States v. Mills, 917 F.3d 324, 330 (4th Cir. 2019) (internal
quotation marks omitted) (alteration in original). The district court explicitly stated that
even had it erred in overruling Sloan’s enhancement objections, it still would have imposed
a variance sentence of 120 months because it was the sentence “sufficient but not greater
than necessary with respect to [Sloan] in light of the entire record.” J.A. 101. Our view of
6
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the record confirms that the variance sentence would be substantively reasonable, as the
district court fully discussed the circumstances relating to Sloan’s offense, and properly
weighed mitigating and aggravating evidence. See Mills, 917 F.3d at 331.
III.
After the opening, response, and reply briefs all had been filed, Sloan moved to file
a supplemental brief raising, for the first time, a challenge to his base offense level. He
argues that under this court’s decision in United States v. Campbell, 22 F.4th 438 (4th Cir.
2022), his prior North Carolina drug convictions do not qualify as “controlled substance
offenses” under the Sentencing Guidelines, and thus the PSR erroneously calculated his
base offense level at 24. We deny this motion. It is a blackletter rule of appellate procedure
that “contentions not raised in the argument section of the opening brief are abandoned.”
United States v. Al-Hamdi, 356 F.3d 564, 571 n.8 (4th Cir. 2004). This court issued
Campbell on January 7, 2022, a full six weeks before Sloan filed his opening brief in this
case. Because Sloan “fail[ed] to preserve the issue in [his] opening brief,” he abandoned it,
and “[n]o subsequent filing can revive it.” Hensley ex rel. North Carolina v. Price, 876
F.3d 573, 580 n.5 (4th Cir. 2017). We decline to deviate from this rule here.
IV.
For the foregoing reasons, the judgment is affirmed.
AFFIRMED
7 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483375/ | USCA4 Appeal: 20-1927 Doc: 30 Filed: 11/10/2022 Pg: 1 of 4
UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 20-1927
WALMART REAL ESTATE BUSINESS; SAM’S REAL ESTATE BUSINESS
TRUST,
Plaintiffs - Appellees,
v.
QUARTERFIELD PARTNERS LLC; BL QUARTERFIELD ASSOCIATES LLC;
Q.O.P. PROPERTIES LLC; QUARTERFIELD OFFICE PARK LLC,
Defendants - Appellants.
Appeal from the United States District Court for the District of Maryland, at Baltimore.
Deborah Lynn Boardman, District Judge. (1:18-cv-03664-DLB)
Argued: October 25, 2022 Decided: November 10, 2022
Before KING, AGEE, and QUATTLEBAUM, Circuit Judges.
Appeal dismissed by unpublished per curiam opinion.
ARGUED: Rignal Woodward Baldwin V, BALDWIN SERAINA, LLC, Baltimore,
Maryland, for Appellants. Tillman J. Breckenridge, BRECKENRIDGE PLLC,
Washington, D.C., for Appellees. ON BRIEF: Rignal W. Baldwin, Sr., Douglas B. Riley,
BALDWIN SERAINA, LLC, Baltimore, Maryland, for Appellants. Donald A. Rea, Leila
F. Parker, SAUL EWING ARNSTEIN & LEHR LLP, Baltimore, Maryland, for Appellees.
Unpublished opinions are not binding precedent in this circuit.
USCA4 Appeal: 20-1927 Doc: 30 Filed: 11/10/2022 Pg: 2 of 4
PER CURIAM:
In this contract dispute, plaintiffs Walmart Real Estate Business Trust (“Walmart”)
and Sam’s Real Estate Business Trust (“Sam’s”) allege that they are entitled to options to
purchase two parcels of real property in Anne Arundel County, Maryland, that they lease
from defendants Quarterfield Partners LLC, BL Quarterfield Associates LLC, Q.O.P.
Properties LLC, and Quarterfield Office Park LLC (collectively, “Quarterfield”). The
action was brought in the District of Maryland, pursuant to the district court’s diversity
jurisdiction. See 28 U.S.C. § 1332(a). By their operative Amended Complaint of February
2019, Walmart and Sam’s seek the following relief under the controlling state law of
Maryland: a declaratory judgment that they are entitled to options to purchase the parcels
and that they timely sought to exercise those options (Count I); an order directing
Quarterfield to sell them the parcels (Count II); and an award of monetary damages of at
least $75,000 (Count III).
After the parties consented to having the district court proceedings conducted by a
magistrate judge, see 28 U.S.C. § 636(c), Quarterfield moved for summary judgment, and
Walmart and Sam’s moved for partial summary judgment on Counts I and II. By its
Memorandum Opinion and Order of July 2020, the district court denied Quarterfield’s
summary judgment motion and granted the partial summary judgment motion filed by
Walmart and Sam’s. See Walmart Real Est. Bus. Trust v. Quarterfield Partners LLC, No.
1:18-cv-03664 (D. Md. July 10, 2020), ECF Nos. 67 & 68. In so doing, the court applied
settled principles of Maryland law to interpret the particular terms of the leases at issue.
At Quarterfield’s unopposed request, the court subsequently entered an Amended Order
2
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that certified this interlocutory appeal pursuant to 28 U.S.C. § 1292(b) from the summary
judgment award on Counts I and II, and that stayed further proceedings on the still-pending
Count III. See Walmart Real Est. Bus. Trust v. Quarterfield Partners LLC, No. 1:18-cv-
03664 (D. Md. July 23, 2020), ECF No. 71.
Again without opposition from Walmart and Sam’s, Quarterfield subsequently
sought our Court’s permission to pursue this interlocutory appeal under § 1292(b). We
granted such permission in August 2020. As explained herein, however, we now recognize
upon further consideration that the permission to appeal was improvidently granted.
In order to satisfy the demands of § 1292(b), the order being reviewed must
“involve[] a controlling question of law as to which there is substantial ground for
difference of opinion,” and “an immediate appeal from the order [must promise to]
materially advance the ultimate termination of the litigation.” See 28 U.S.C. § 1292(b).
We have cautioned that Ҥ 1292(b) should be used sparingly and thus its requirements must
be strictly construed.” See United States ex rel. Michaels v. Agape Senior Cmty., Inc., 848
F.3d 330, 340 (4th Cir. 2017) (quoting Myles v. Laffitte, 881 F.2d 125, 127 (4th Cir. 1989)).
Although “it may be proper to conduct an interlocutory review of an order presenting a
pure question of law” that can be decided “quickly and cleanly,” there is no authorization
for such a review if the court of appeals would have “to delve beyond the surface of the
record in order to determine the facts.” Id. at 340-41 (internal quotation marks omitted).
Consequently, Ҥ 1292(b) review is not appropriate where . . . the question presented turns
on whether there is a genuine issue of fact or whether the district court properly applied
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settled law to the facts or evidence of a particular case.” Id. at 341 (internal quotation
marks omitted).
As stated above, in granting partial summary judgment to Walmart and Sam’s, the
district court simply applied settled principles of Maryland law to interpret the particular
terms of the leases at issue. Moreover, the court’s Amended Order certifying this
interlocutory appeal merely recites the § 1292(b) standard without specifying any
“controlling question of law as to which there is substantial ground for difference of
opinion.” Meanwhile, as argued by Quarterfield, the appeal concerns whether the court
misinterpreted the leases, and not whether the court misconstrued Maryland law. In these
circumstances, we recognize that the permission to appeal under § 1292(b) was
improvidently granted, and we therefore dismiss the appeal.
APPEAL DISMISSED
4 | 01-04-2023 | 11-11-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483381/ | Case: 22-40207 Document: 00516542773 Page: 1 Date Filed: 11/11/2022
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
November 11, 2022
No. 22-40207 Lyle W. Cayce
Clerk
United States of America,
Plaintiff—Appellee,
versus
Cruz Alejandro Prado, Jr.,
Defendant—Appellant.
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 2:20-CR-781-2
Before Higginbotham, Southwick, and Higginson, Circuit
Judges.
Stephen A. Higginson, Circuit Judge:
Cruz Alejandro Prado, Jr., challenges the sentence imposed following
the revocation of his supervised release. Specifically, Prado argues that two
special conditions included in his written judgment should be vacated
because they were not pronounced orally at sentencing as required by this
Court’s precedent.
To satisfy a defendant’s “constitutional right to be present at
sentencing,” United States v. Vega, 332 F.3d 849, 852 (5th Cir. 2003), “[a]
district court must orally pronounce a sentence,” United States v. Grogan,
Case: 22-40207 Document: 00516542773 Page: 2 Date Filed: 11/11/2022
No. 22-40207
977 F.3d 348, 351 (5th Cir. 2020) (citing United States v. Diggles, 957 F.3d
551, 556-57 (5th Cir. 2020) (en banc)). “Including a sentence in the written
judgment that the judge never mentioned when the defendant was in the
courtroom is ‘tantamount to sentencing the defendant in abstentia.’” Diggles,
957 F.3d at 557 (quoting United States v. Weathers, 631 F.3d 560, 562 (D.C.
Cir. 2011)).
When there is a discrepancy between the oral pronouncement and the
written judgment, we must first determine whether such discrepancy “is a
conflict or merely an ambiguity that can be resolved by reviewing the rest of
the record.” United States v. Mireles, 471 F.3d 551, 558 (5th Cir. 2006). A
conflict occurs “[i]f the written judgment broadens the restrictions or
requirements of supervised release from an oral pronouncement,” id. at 558,
or imposes more burdensome conditions, see United States v. Bigelow, 462
F.3d 378, 383 (5th Cir. 2006). In the event of a conflict, the written judgment
must be amended to conform with the oral pronouncement, which controls.
Grogan, 977 F.3d at 352.
Where, as here, a defendant did not object to the conditions of
supervised release in the district court, the standard of review depends on
whether the defendant had an opportunity to object to the condition at
sentencing. Diggles, 957 F.3d at 559-60. If the defendant had a chance to
object yet failed to do so, plain error review applies. Grogan, 977 F.3d at 352.
If the defendant lacked that chance, we review for abuse of discretion. 1 Id.
The Government concedes that Special Condition 6 in the written
judgment, which requires Prado to refrain from excessive use of alcohol, was
1
Because the conditions to which Prado objects were not mandatory under U.S.C.
§ 3583(d) and were not included in the PSR or the original judgment and therefore could
not be incorporated by reference, the parties agree that oral pronouncement was required.
See Diggles, 975 F.3d at 558-60.
2
Case: 22-40207 Document: 00516542773 Page: 3 Date Filed: 11/11/2022
No. 22-40207
not orally pronounced and accordingly must be removed from the written
judgment. See Diggles, 957 F.3d at 556-559.
The parties dispute, however, whether the first sentence of Special
Condition 2 in the written judgment should be similarly struck. Special
Condition 2 requires Prado to “take all mental-health medications that are
prescribed by [his] treating physician.” At the sentencing hearing, the
district court generally discussed Prado’s need for medication to treat his
bipolar disorder, anxiety, and ADHD, and probation recommended that
mental health treatment be imposed as a condition of supervised release so
that Prado could receive such medication. Following this discussion, the
district court pronounced that it would require Prado to undergo mental
health treatment as a condition of supervised release. In so doing, the district
court noted that “the programming need[ed] to be tailored to [Prado’s]
specific ADHD and impulsivity disorder so that he [could] get meds for
that.” The district court closed by informing Prado that the Government
would pay for his medication if he could not afford it and expressing his hope
that the medication would help keep Prado out of trouble.
Although the Government contends that the statements by the district
court made it clear that Prado would be required to take his prescribed mental
health medication as a condition of release, we agree with Prado that the
general discussion about his need for medication was insufficient to put him
on notice that the court was imposing a requirement to take such medication.
Simply put, stating that Prado should participate in a mental health program
that gives him access to medication and expressing hope that these
medications will help him is not the same as imposing a judicial requirement,
subject to further revocation, that he must take those medications. Requiring
Prado to take all his medication can be either be viewed as broadening or
expanding the requirements of supervised release, see Mireles, 571 F.3d at 558,
or imposing a more burdensome condition—taking medication—than the
3
Case: 22-40207 Document: 00516542773 Page: 4 Date Filed: 11/11/2022
No. 22-40207
oral pronouncement, see Bigelow, 462 F.3d at 383. In either case, it constitutes
a conflict between the written judgment and the oral pronouncement, and the
condition must be removed from the written judgment. See Diggles, 957 F.3d
at 556-59; see also United States v. Hernandez, 2022 WL 1224480, at *2 (5th
Cir. Apr. 26, 2022) (unpublished) (finding that the district court abused its
discretion by imposing a written condition to take all prescribed mental
health medications where the oral pronouncement referenced only the
requirement to participate in a mental health treatment program).
Accordingly, we VACATE in part and REMAND to the district
court to amend the written judgment in accordance with this opinion. In all
other respects, the judgment is AFFIRMED.
4 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483383/ | Case: 22-40448 Document: 00516542572 Page: 1 Date Filed: 11/11/2022
United States Court of Appeals
for the Fifth Circuit United States Court of Appeals
Fifth Circuit
FILED
November 11, 2022
No. 22-40448
Lyle W. Cayce
Clerk
United States of America,
Plaintiff—Appellee,
versus
Mario Flores,
Defendant—Appellant.
Appeal from the United States District Court
for the Eastern District of Texas
USDC No. 4:22-CR-89-1
Before Stewart, Willett, and Oldham, Circuit Judges.
Per Curiam:
Mario Flores appeals an order that he be detained pending trial. He
also avers that the district court erred in failing to hold a de novo detention
hearing. Flores is charged with possessing with intent to distribute a mixture
or substance containing a detectable amount of marihuana or hashish oil and
possessing a firearm in furtherance of a drug trafficking crime.
“Absent an error of law, we must uphold a district court’s pretrial
detention order if it is supported by the proceedings below, a deferential
Case: 22-40448 Document: 00516542572 Page: 2 Date Filed: 11/11/2022
No. 22-40448
standard of review that we equate to the abuse-of-discretion standard.”
United States v. Hare, 873 F.2d 796, 798 (5th Cir. 1989) (internal quotation
marks and citation omitted). We review questions of law de novo, United
States v. Olis, 450 F.3d 583, 585 (5th Cir. 2006), and we review factual
findings supporting an order of detention for clear error, United States v.
Aron, 904 F.2d 221, 223 (5th Cir. 1990).
Flores does not dispute that, in light of the charged offenses, a
rebuttable presumption arises that no condition or combination of conditions
will reasonably assure his appearance at trial and the safety of the community.
See 18 U.S.C. § 3142(e)(3)(A), (B). “The presumption shifts to the
defendant only the burden of producing rebutting evidence, not the burden
of persuasion.” Hare, 873 F.2d at 798. But “the mere production of evidence
does not completely rebut the presumption.” Ibid. In applying this burden-
shifting framework, the district court should consider the factors listed in 18
U.S.C. § 3142(g).
The magistrate judge and the district court emphasized the first and
fourth § 3142(g) factors—the nature of the offense under (g)(1) and the
danger to the community under (g)(4). As to the first factor, the district court
emphasized the amount of drugs involved in this case and the fact that Flores
faced a lengthy punishment. And as to the fourth factor, the district court
correctly recognized our precedent holding “that the risk of continued
narcotics trafficking on bail does constitute a risk to the community.” United
States v. Rueben, 974 F.2d 580, 586 (5th Cir. 1992). Flores was involved in
trafficking a significant quantity of drugs and previously committed other
drug offenses. That evidence was sufficient to support the district court’s
evaluation of the first and fourth § 3142(g) factors.
Flores disputes none of this. Rather, he points to the third § 3142(g)
factor—regarding the personal characteristics of the defendant. Flores
2
Case: 22-40448 Document: 00516542572 Page: 3 Date Filed: 11/11/2022
No. 22-40448
presented evidence of his family connections, work history, lack of prior
felonies, past compliance with bond conditions, and insufficient resources to
flee. On the other hand, the record also shows that Flores previously used
and distributed drugs under his parents’ roof. Moreover, Flores used drugs
on a weekly basis and committed the instant charged offenses while on state
probation. See 18 U.S.C. § 3142(g)(3)(A) (drug use), (B) (probation). The
evidence of Flores’ work history, lack of prior felonies, and family’s
insufficient resources to help him flee also are not enough to demonstrate
that the district court abused its discretion in evaluating the third § 3142(g)
factor, let alone its consideration of all four. *
Because the district court’s finding on dangerousness is supported by
the record, we need not address its determination that Flores was a flight risk.
See Rueben, 974 F.2d at 586. But in any event, Flores was a flight risk. Flores
had a prior evading arrest charge. He had violated probation conditions in the
past. And he was arrested for a drug offense, which Congress has determined
“as a general rule, pose[s] special risks of flight.” United States v. Fortna, 769
F.2d 243, 251 (5th Cir. 1985) (quotation omitted) (finding that a drug
offender with no prior convictions, no history of violence, and significant
family and community ties to an area where he owned real estate and resided
for 30 years was at a risk of flight because he was involved in international
drug trafficking). The district court did not abuse its discretion in concluding
that even though Flores had family ties to the area, he still presented a flight
risk.
*
United States v. Jackson, 845 F.2d 1262 (5th Cir. 1988), is not to the contrary. In
that case, this court found that the district court improperly relied on the § 3142(e)
presumption where there was “an utter absence of incriminatory evidence” besides the
indictment and where the defendant presented significant evidence of ties to the
community. Id. at 1265–66. But here the Government presented ample evidence of the
underlying drug trafficking and firearms offenses.
3
Case: 22-40448 Document: 00516542572 Page: 4 Date Filed: 11/11/2022
No. 22-40448
Finally, Flores fails to demonstrate that the district court abused its
discretion by failing to conduct a de novo hearing. The district court only must
review the evidence “de novo and make[] an independent determination” on
a pretrial detention order. Fortna, 769 F.2d at 249. Neither the statute nor
precedent requires a new hearing. Therefore, we conclude that the district
court did not abuse its discretion.
AFFIRMED.
4 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483390/ | Opinion filed November 10, 2022
In The
Eleventh Court of Appeals
___________
No. 11-22-00247-CV
___________
IN THE INTEREST OF L.C. AND E.T., CHILDREN
On Appeal from the 326th District Court
Taylor County, Texas
Trial Court Cause No. 10315-CX
MEMORANDUM OPINION
Appellant has filed in this court a motion to dismiss her appeal. In the motion,
Appellant requests that her appeal be dismissed and prays that we enter an order
doing so. Accordingly, we dismiss this appeal pursuant to Appellant’s motion. See
TEX. R. APP. P. 42.1(a)(1).
The motion to dismiss is granted, and the appeal is dismissed.
November 10, 2022 PER CURIAM
Panel consists of: Bailey, C.J.,
Trotter, J., and Williams, J. | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483393/ | 11TH COURT OF APPEALS
EASTLAND, TEXAS
JUDGMENT
Jesus Albino Rodriguez, * From the 441st District Court
of Midland County,
Trial Court No. CR54254.
Vs. No. 11-21-00126-CR * November 10, 2022
The State of Texas, * Memorandum Opinion by Trotter, J.
(Panel consists of: Bailey, C.J.,
Trotter, J., and Williams, J.)
This court has inspected the record in this cause and concludes that there is
error in the judgment below. Therefore, in accordance with this court’s opinion,
we modify the trial court’s judgment and the district clerk’s bill of costs to delete
(1) the court-appointed attorney’s fees that were ordered to be assessed against
Appellant and (2) the trial court’s requirement that Appellant pay such fees. As
modified, we affirm the judgment of the trial court. | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483395/ | 11TH COURT OF APPEALS
EASTLAND, TEXAS
JUDGMENT
Eddie Dale Underwood, * From the 259th District Court
of Jones County,
Trial Court No. 6880-D.
Vs. No. 11-22-00218-CR * November 10, 2022
The State of Texas, * Per Curiam Memorandum Opinion
(Panel consists of: Bailey, C.J.,
Trotter, J., and Williams, J.)
This court has inspected the record in this cause and concludes that the appeal
should be dismissed for want of jurisdiction. Therefore, in accordance with this
court’s opinion, the appeal is dismissed. | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483396/ | Order filed November 10, 2022
In The
Eleventh Court of Appeals
__________
No. 11-21-00145-CR
__________
DANIEL RAY GARCIA, Appellant
V.
THE STATE OF TEXAS, Appellee
On Appeal from the 106th District Court
Gaines County, Texas
Trial Court Cause No. 19-5086
ORDER
Appellant, Daniel Ray Garcia, represents himself in this appeal. This appeal
was filed on July 12, 2021. However, Appellant has yet to file a brief in this appeal.
The appeal has been delayed because of a variety of factors: 1) the length of time
required by the trial court clerk and the court reporter to prepare the voluminous
appellate record; 2) Appellant’s complaints concerning the accuracy of the appellate
record; 3) Appellant’s status as an incarcerated, pro se litigant.
On November 3, 2022, Appellant filed a motion entitled “Under Rule 10.3(3)
2nd Motion to Request Said Documents in Paper Form Not USB Flash Drive AND
Request Them Without Prejudice.” This is at least the fortieth motion that Appellant
has filed in this cause. As per the motion, Appellant contends that in Cause No. 11-
21-00145-CR,1 he does not have paper copies of the following pages of the clerk’s
record: 2–9, 12–14, 41–45, 47–48, 109–115, 118–120, 147–156, 217–220, 313–
319, 434, 463, 477, 483, 494, 500, 508–517, 521–522, 558, 561, 602–605, 608, 610,
619–642, 644–647, 649–650, 654–668, 742, and 748–749. He contends that while
he was incarcerated, prison officials lost his property when he was moved from one
prison location to another. He further contends that the appellate record in Cause
No. 11-21-00145-CR was among the items of property that were lost.
Upon learning that Appellant’s property had been lost, the clerk of this court
contacted officials with the Texas Department of Criminal Justice, including
officials in the warden’s office and the law library at Appellant’s prison unit, to
determine the accuracy of Appellant’s reported loss of property. The most recent
conversation with the prison officials was that Appellant has now received all of his
property. Those conversations also revealed that if the clerk of our court forwarded
a digital copy of the appellate records in Appellant’s pending appeals on a USB
drive, Appellant would have access to them via the law library. The clerk of this
court took advantage of this offer as a measure to provide Appellant with a backup
copy of the appellate records.
We note that Appellant has already been provided with a complete paper copy
of the appellate record in this cause. Appellant is not entitled to multiple copies of
the record due to his indigent status or his status as an incarcerated individual. See
1
Appellant also asserts in the motion that he is missing records in Cause No. 11-21-00200-CR.
Appellant’s requests for additional paper records in Cause No. 11-21-00200-CR is denied because that case
has already been briefed and submitted.
2
Ex parte Hollowell, No. 03-11-00240-CR, 2012 WL 1959309, at *1 (Tex. App.—
Austin June 1, 2012, pet. ref’d) (mem. op., not designated for publication). In the
interest of expediency, however, this court has made paper copies of the specific
portions of the clerk’s record that he contends he does not currently possess, and we
are mailing same to Appellant along with a copy of this order. In this regard, this
appeal has become unduly delayed. Appellant’s brief remains due for filing on or
before December 19, 2022.
Appellant’s motion is granted in part—only to the extent provided in this
order. All further requested relief is denied.
PER CURIAM
November 10, 2022
Do not publish. See TEX. R. APP. P. 47.2(b).
Panel consists of: Bailey, C.J.,
Trotter, J., and Williams, J.
3 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483405/ | THE THIRTEENTH COURT OF APPEALS
13-22-00010-CR
THE STATE OF TEXAS
v.
HECTOR GUILLERMO IBARRA
On Appeal from the
County Court at Law No. 6 of Hidalgo County, Texas
Trial Cause No. CR-19-09347-F
JUDGMENT
THE THIRTEENTH COURT OF APPEALS, having considered this cause on
appeal, concludes that the judgment of the trial court should be reversed and the cause
remanded to the trial court. The Court orders the judgment of the trial court REVERSED
and REMANDED for further proceedings in accordance with its opinion.
We further order this decision certified below for observance.
November 10, 2022 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483404/ | NUMBER 13-22-00010-CR
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
THE STATE OF TEXAS, Appellant,
v.
HECTOR GUILLERMO IBARRA Appellee.
On appeal from the County Court at Law No.6
of Hidalgo County, Texas.
MEMORANDUM OPINION
Before Chief Justice Contreras and Justices Benavides and Tijerina
Memorandum Opinion by Justice Tijerina
Appellant Hector Guillermo Ibarra was charged with driving while intoxicated
(DWI). See TEX. PENAL CODE ANN. § 49.09(a). By its sole issue, the State argues that the
trial court erred in granting Ibarra’s motion to suppress because the State obtained a valid
warrant. We reverse and remand.
I. BACKGROUND
In Ibarra’s motion to suppress, he argued that the seizure of his blood specimen
was without a valid search warrant “and in violation of statute.” On December 2, 2021,
the trial court held a hearing.
At the hearing, Officer Eric Valdez from the Donna Police Department (DPD)
testified that on May 31, 2019, he arrived at the scene to assist his sergeant in conducting
a traffic stop. According to Officer Valdez, when he made contact with Ibarra who was in
the driver’s seat of the vehicle, Ibarra displayed signs of intoxication, such as slurred
speech, bloodshot eyes, and unsteady balance when he exited the vehicle. Ibarra
informed Officer Valdez that he was coming from a bar, on his way to another bar, and
had consumed two beers. Officer Valdez conducted a Standard Field Sobriety Test. First,
he conducted the horizontal gaze nystagmus and observed “the lack of smooth pursuit,
and distinct and sustained nystagmus at the maximum deviation.” He then administered
the walk-and-turn test in which Ibarra displayed seven out of eight potential clues of
intoxication. Lastly, Officer Valdez administered the one-leg stand test in which Ibarra
displayed all four potential clues of intoxication: he swayed, hopped, set his foot down,
and used his arms for balance. Based on the totality of his observations and the clues he
observed, Officer Valdez arrested Ibarra for DWI, read him his rights, 1 and requested a
specimen of his breath, which Ibarra refused.
1 Officer Valdez explained that he read Ibarra the “DIC-24,” a form which “describes the defendant’s
rights. It gives a warning that he’s placed under arrest, and the officer’s authority to request a blood
specimen, and the penalties regarding his driver’s license if he refuses to provide a blood specimen.”
2
Officer Valdez advised Ibarra that he “had the authority to apply for a blood search
warrant.” After transporting Ibarra to the DPD, Officer Valdez applied for a search warrant,
which a magistrate granted. In his motion to suppress, Ibarra argued that “under [§]
724.013 . . . to obtain that warrant that you may apply for, you need to meet these certain
exceptions, and in this case none of the exceptions were met.” See TEX. TRANSP. CODE
ANN. § 724.013 (“Except as provided by [§] 724.012(a-1) or (b), a specimen may not be
taken if a person refuses to submit to the taking of a specimen designated by a peace
officer.”). The trial court granted Ibarra’s motion to suppress, and the State appealed. See
TEX. CODE CRIM. PROC. ANN. art. 44.01(a)(5) (State may appeal an order granting a motion
to suppress evidence).
II. MOTION TO SUPPRESS
By its sole issue, the State argues that the trial court erred in suppressing Ibarra’s
blood specimen because Officer Valdez secured a valid warrant to obtain the specimen.
A. Standard of Review
We review a ruling on a motion to suppress using a bifurcated standard of review.
Crain v. State, 315 S.W.3d 43, 48 (Tex. Crim. App. 2010). We afford almost total
deference to the trial court’s findings of historical fact that are supported by the record,
and to mixed questions of law and fact that turn on an assessment of a witness’s credibility
or demeanor. Valtierra v. State, 310 S.W.3d 442, 447 (Tex. Crim. App. 2010); Amador v.
State, 221 S.W.3d 666, 673 (Tex. Crim. App. 2007). We review de novo the trial court’s
determination of legal questions and its application of the law to facts that do not turn
3
upon a determination of witness credibility and demeanor. Valtierra, 310 S.W.3d at 447;
Amador, 221 S.W.3d at 673; Kothe v. State, 152 S.W.3d 54, 62–63 (Tex. Crim. App.
2004). “We uphold the trial court’s ruling if it is supported by the record and correct under
any theory of law applicable to the case.” State v. Iduarte, 268 S.W.3d 544, 548 (Tex.
Crim. App. 2008).
B. Discussion
At the motion to suppress hearing, Ibarra argued that for the State to obtain a
warrant for the specimen, the State must meet each of § 724.012(a-1) (1-4) requirements
in the transportation code, and none of those requirements were met here. See TEX.
TRANSP. CODE ANN. § 724.012(a–1) (providing that an officer shall require a specimen if:
(1) the officer made a DWI arrest; (2) the person refuses to provide a sample; (3) the
person operated a motor vehicle involved in an accident; and (4) at the time of the arrest,
the officer reasonably believes that as a direct result of the accident, a person will die or
suffer serious bodily injury). However, the Texas Court of Criminal Appeals has rejected
this very argument, holding that Chapter 724 of the transportation code does not apply
when an officer has obtained a valid warrant to draw blood. See Beeman v. State, 86
S.W.3d 613, 616 (Tex. Crim. App. 2002) (recognizing the constitutionality of blood draws
performed pursuant to a valid warrant); see also State v. Johnston, 336 S.W.3d 649, 661
(Tex. Crim. App. 2011) (“In Beeman v. State, we held that Chapter 724 is inapplicable
when there is a warrant to draw blood . . . .”).
In Beeman, the officer executed a search warrant for the defendant’s blood over
4
the defendant’s objection. See 86 S.W.3d at 614. The defendant argued that “regardless
of whether the Fourth Amendment is satisfied by the search warrant, the search is
nevertheless invalid because it violates the statute [in the transportation code].” Id. at 616;
see TEX. TRANSP. CODE ANN. § 724.012 (providing statutorily implied consent and
negating the need for a warrant in certain circumstances). The court held that the “implied
consent law . . . is important when there is no search warrant, since it is another method
of conducting a constitutionally valid search,” but “if the State has a valid search warrant,
it has no need to obtain the suspect’s consent.” Beeman, 86 S.W.3d at 615. The court
explained:
[t]he implied consent law expands on the State’s search capabilities by
providing a framework for drawing DWI suspects’ blood in the absence of a
search warrant. It gives officers an additional weapon in their investigative
arsenal, enabling them to draw blood in certain limited circumstances even
without a search warrant. But once a valid search warrant is obtained by
presenting facts establishing probable cause to a neutral and detached
magistrate, consent, implied or explicit, becomes moot.
Id. at 616. Because Officer Valdez obtained a valid search warrant before obtaining
Ibarra’s blood and Ibarra does not challenge the warrant’s validity, the trial court erred by
suppressing the blood specimen.2 See Valtierra, 310 S.W.3d at 447. We sustain the
State’s issue.
III. CONCLUSION
We reverse and remand for proceedings consistent with this memorandum
2We note that at the motion to suppress hearing, Ibarra limited his argument to the application of
§ 724.012. See TEX. TRANSP. CODE ANN. § 724.012.
5
opinion.
JAIME TIJERINA
Justice
Do not publish.
TEX. R. APP. P. 47.2 (b).
Delivered and filed on the
10th day of November, 2022.
6 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483413/ | NUMBER 13-21-00250-CR
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
MONTE RODNEY SCALES JR., Appellant,
v.
THE STATE OF TEXAS, Appellee.
On appeal from the 36th District Court
of San Patricio County, Texas.
OPINION
Before Chief Justice Contreras and Justices Benavides and Tijerina
Opinion by Justice Benavides
Appellant Monte Rodney Scales Jr. appeals the revocation of his community
supervision for a failure to pay a court-ordered fine and fees.
By five issues, Scales argues: (1) there was insufficient evidence to show that he
failed to pay the court-ordered fine; (2) there was insufficient evidence to show that he
failed to pay the court-ordered fees and that he both had the ability to pay and willfully
refused to pay those fees; (3) his constitutional right to due process was violated by the
trial court revoking his community supervision without first assessing whether Scales had
the ability to pay; (4) his constitutional right to due process was violated by the trial court’s
failure to consider suitable alternatives to imprisonment; and (5) the trial court improperly
assessed attorney’s fees as a condition of Scales’s community supervision. Because we
conclude the evidence was insufficient to support the trial court’s findings, we reverse and
render.
I. BACKGROUND
On January 1, 2017, Scales was indicted on two counts of violating a protective
order with two or more prior convictions, a third-degree felony, and one count of invasive
visual recording, a state jail felony. See TEX. PENAL CODE ANN. §§ 21.15, 25.07(g)(2). On
June 26, 2017, Scales pleaded guilty to all three counts, was adjudicated guilty, and the
trial court sentenced him to five years’ confinement and a $750 fine for counts one and
two, and two years’ confinement for count three. The trial court suspended all three
sentences and placed Scales on community supervision for five years.
On August 19, 2020, the State filed motions to revoke for all three counts. On
January 25, 2021, the State filed amended motions to revoke for all three counts. As to
count one, the count from which Scales now appeals, the motion to revoke alleged that
Scales failed to comply with the following terms of his community supervision:
1. Pay to the Supervision Officer of San[ ]Patricio County, Texas a
Statutory Supervisory Fee of $60.00 per month . . . which is due
within the first ten days of each month, beginning thirty (30) days
after discharge from the State of Texas Intermediate Sanction
Facility-Cognitive Track;
2
2. Pay to the Supervision Officer of San Patricio County, Texas, an
Application Fee of $100.00 for each interstate or intrastate transfer
of community supervision, which is due within the first thirty days of
community supervision, any transfers thereafter will require the fee
to be paid on the date of application;
3. Pay to the San Patricio County District Clerk, the amount of $300,
Instanter, to be applied to the Court Costs and/or Attorney Fees
(if applicable) in the amount of $2,108.00 and a Fine in the amount
of $750.00;
4. Pay to the San Patricio County District Clerk, the amount of $375.00
of which is probated and the remaining balance of $375.00 shall be
paid at a rate of $____ per month, beginning __________, 2018, and
the same day of each month thereafter until the [f]ine has been paid
in full;
5. Do not have contact or communicate directly or indirectly with the
victim or victims in this cause by any means including written,
internet, telecommunication[,] or third-party communication.
6. Abstain from the possession and consumption of alcohol in any form
during the term of community supervision.
At a hearing on July 6, 2021, Scales pleaded “not true” to each of the State’s
allegations. Mallory Gardner, the deputy director for the 36th, 156th, and 343rd Judicial
District Community Supervision and Corrections Department, testified to some of the
alleged violations. According to Gardner, on or about January 13, 2021, she was at Twin
Peaks and noticed Scales went “to the bar and was served a beer in a cold mug.”
However, Gardner also testified that the following day, Scales took a urinalysis test that
yielded a negative result for alcohol. Gardner agreed that alcohol stays in an individual’s
system for “[a]pproximately three [days], depending on the amount of consumption.”
Additionally, Gardner discussed Scales’s financial obligations. Gardner testified
that Scales was delinquent in the amount of $640 for “probation fees” and $100 for “a
3
transfer fee.” Gardner also explained that Scales had $2,083 in “total arrears” for failing
to pay $60 per month for “the fines, fees[,] and court costs.” Gardner testified to the
specific months that Scales failed to make these required payments. However, Gardner
agreed that Scales had made several large payments, including a $500 payment made
on April 20, 2021, another “large payment” around the time the COVID-19 pandemic
started, and one other payment of an unspecified amount at an unknown time.
Scales testified that he was sober because his mom used to be an alcoholic, and
he “made her a promise that [he] wouldn’t drink.” According to Scales, Gardner observed
him with a non-alcoholic beer. Scales also denied having inappropriate communications
with the victim’s daughter. Scales testified, “Well, last May, I almost died. I was in the
hospital. My appendix had burst and when she found out that I was in the hospital, [the
victim’s daughter] reached out and asked me if I was doing okay and that’s how it started.”
Scales testified that he and the victim’s daughter had merely rekindled a friendship. He
denied ever attempting to directly or indirectly communicate with the victim.
Scales discussed his unemployment history. Initially, Scales testified that he was
laid off in “like March” of 2020. Scales later testified that he was actually laid off in either
“April or May of 2020.” According to Scales, the day before he was laid off, he purchased
a 2020 Toyota Tundra that had a sticker price of $51,000. Scales traded in his old vehicle,
and the dealership gave him a $25,000 credit towards the purchase price. Scales
acquired a loan for the remaining balance. However, Scales testified that he had since
“missed a few” payments on the car note.
Scales explained that “during the times [he] was laid off, [he] was unable to” make
4
his required community supervision payments. He also testified that he found a “good
job” at the “end of March, beginning of April” 2021, and that he planned to become current
on his community supervision obligations. No evidence was presented, either by the State
or by Scales, concerning his income.
At the conclusion of the trial, the trial court revoked Scales’s community
supervision for count one and sentenced him to four years’ imprisonment. 1 In its written
judgment, the court found true the State’s allegations that Scales violated provisions of
his community supervision relating to: (1) paying a statutory supervisory fee of $60.00 per
month, (2) paying an application fee of $100.00 for each interstate or intrastate transfer
of community supervision within thirty days of the imposition of his community
supervision, and (3) paying the non-probated amount of his fine “at a rate of $____ per
month, beginning __________, 2018, and the same day of each month thereafter until
the fine has been paid in full.” (blanks in original). The judgment did not contain findings
as to the State’s remaining allegations.
This appeal followed. The State has not filed a brief.
II. SUFFICIENCY OF THE EVIDENCE
By his first and second issues, Scales argues that the evidence is insufficient to
show he violated the conditions of his community supervision.
A. Standard of Review
We review an order revoking community supervision for an abuse of discretion.
Hacker v. State, 389 S.W.3d 860, 865 (Tex. Crim. App. 2013); Rickels v. State, 202
1 As to counts two and three, the trial court continued Scales on community supervision. Counts
two and three are not at issue in this appeal.
5
S.W.3d 759, 763 (Tex. Crim. App. 2006). “To convict a defendant of a crime, the State
must prove guilt beyond a reasonable doubt, but to revoke probation (whether it be regular
probation or deferred adjudication), the State need prove the violation of a condition of
probation only by a preponderance of the evidence.” Hacker, 389 S.W.3d at 864–65. In
other words, the State need only show that the greater weight of the evidence creates a
reasonable belief that the defendant has violated a condition of his probation. Rickels,
202 S.W.3d at 763–64. A trial court abuses its discretion by revoking probation when the
State has failed to meet its burden of proof. Cardona v. State, 665 S.W.2d 492, 493–94
(Tex. Crim. App. 1984). We examine the record in the light most favorable to the trial
court’s ruling. Jones v. State, 112 S.W.3d 266, 268 (Tex. App.—Corpus Christi–Edinburg
2003, no pet.).
B. Analysis
1. Fine
A trial court is permitted to order the payment of a fine either (1) when the sentence
is pronounced; (2) at some later date; or (3) at designated intervals. TEX. CODE. CRIM.
PROC. ANN. art. 42.15(b)(1–3). Here, paragraph four of the community supervision
conditions required Scales to pay his fine “at a rate of $_____ per month, beginning
_________, 2018, and the same day of each month thereafter until the Fine has been
paid in full.”
The language and context of the fine provision indicates that nothing was due on
the date the sentence was pronounced.2 Although the intent of the provision appears to
2 We note that paragraph three of the community supervision conditions required Scales to pay
$300 to the San Patricio County District Clerk’s Office “[i]nstanter.” This provision explained that the $300
6
permit Scales to pay the fine in a specified amount over a period of designated intervals,
the blanks indicating the amount he was to pay each month and the start date to begin
payment were never filled.
Assuming but not deciding that paragraph four complies with Article 42.15(b) of
the code of criminal procedure, we nevertheless conclude that the State has not met its
burden to show by a preponderance of the evidence that Scales violated this provision.
First, Gardner testified that the clerk’s records did not “indicate a delinquent amount” for
the fine Scales was ordered to pay, “just a balance.” Gardner did not divulge the balance
remaining on the fine. Second, even if Scales had not paid anything on the fine, he would
have been compliant with the plain language of this provision, which required him to pay
nothing each month until the fine had been paid in full. Scales’s period of community
supervision had not yet expired at the time of the final hearing, and even if it had, “[a]
defendant remains obligated to pay any unpaid fine or court cost after the expiration of
the defendant’s period of community supervision.” Id. art. 42A.651(b).
We therefore hold that the trial court abused its discretion by finding Scales
violated this term of his community supervision.
2. Fees
The ability-to-pay statute, as it is commonly referred to, reads as follows:
In a revocation hearing at which it is alleged only that the defendant violated
the conditions of community supervision by failing to pay community
supervision fees or court costs or by failing to pay the costs of legal services
as described by Article 42A.301(b)(11), the state must prove by a
preponderance of the evidence that the defendant was able to pay and did
not pay as ordered by the judge.
instanter payment would be used, in part, to pay Scales’s fine. Although the State alleged that Scales
violated this provision, too, the trial court did not find that allegation to be true.
7
Id. art. 42A.751(i).
The Texas Court of Criminal Appeals has held that community supervision
conditions relating to certain financial obligations, like fines, are exempt from the ability-
to-pay statute. See Gipson v. State, 428 S.W.3d 107, 108–109 (Tex. Crim. App. 2014)
(“Gipson II”). The Gipson II Court based this holding in part on the statute’s silence
concerning fines and the remedial purposes that the costs listed in the statute serve. See
id. We previously interpreted Gipson II and Article 42A.751(i) together and concluded that
the ability-to-pay statute covers “any and all fees imposed on a defendant, as conditions
of community supervision, which serve a remedial purpose of compensating the State for
costs associated with the defendant’s prosecution and community supervision.” Martinez
v. State, 563 S.W.3d 503, 513–15 (Tex. App.—Corpus Christi–Edinburg 2018, no pet.).
Accordingly, we conclude that the “statutory supervisory fee” and “application fee”—which
are associated with compensating the State for Scales’s community supervision in this
case—are encompassed by the ability-to-pay statute. See id. at 515.
However, the ability-to-pay statute only requires the State to prove the defendant’s
ability to pay “[i]n a revocation hearing at which it is alleged only that the defendant
violated the conditions of community supervision by failing to pay community supervision
fees.” TEX. CODE CRIM. PROC. ANN. art. 42A.751(i) (emphasis added). Some Texas courts
have concluded that Article 42A.751(i) does not apply, and the State is not required to
show that the defendant had the ability to pay, when a failure to pay fees and costs is not
the only violation alleged by the State in its motion to revoke or at the hearing on its motion
to revoke. See Rushing v. State, No. 12-21-00052-CR, 2022 WL 868715, at *3 (Tex.
8
App.—Tyler Mar. 23, 2022, no pet.) (mem. op., not designated for publication) (“Because
the State alleged violations in addition to those listed in the ability-to-pay statute, the
statute did not work to give the State the burden of proving that Appellant had the ability
to pay her community supervision fees, and the trial court did not err by revoking
Appellant’s community supervision on that basis.”); Lopez v. State, No. 13-18-00130-CR,
2019 WL 2381463, at *3 (Tex. App.—Corpus Christi–Edinburg June 6, 2019, no pet.)
(mem. op., not designated for publication) (“Because the State alleged Lopez committed
multiple violations of his community supervision, it was not required to prove Lopez had
the ability to pay.”); Farr v. State, No. 13-17-00297-CR, 2018 WL 4017118, at *4 (Tex.
App.—Corpus Christi–Edinburg Aug. 23, 2018, no pet.) (mem. op., not designated for
publication) (“Article 42A.751(i) does not apply because Farr’s failure to pay his fines was
not the only violation alleged by the State.”); Beard v. State, No. 14-15-00606-CR & No.
14-15-00607-CR, 2016 WL 4533414, at *5 (Tex. App.—Houston [14th Dist.] Aug. 30,
2016, pet. ref’d) (mem. op., not designated for publication) (“[W]hen the only allegation at
a community supervision revocation hearing is that the defendant failed to pay fees or
court costs, the State must prove by a preponderance of the evidence that the defendant
was able to pay and did not pay as ordered by the judge.”).
Here, more was alleged than just a failure to pay financial obligations: for count
one, the State also alleged that Scales had inappropriate direct or indirect contact with
the victim and consumed or possessed alcohol in violation of his community supervision
conditions. However, the trial court’s decision to revoke Scales’s probation was based
solely on his failure to pay the fine, a finding which we have already held was supported
9
by insufficient evidence, and his failure to pay certain community supervision fees.
“We interpret a statute in accordance with the plain meaning of its language unless
the language is ambiguous or the plain meaning leads to absurd results that the
Legislature could not possibly have intended.” Scott v. State, 55 S.W.3d 593, 596 (Tex.
Crim. App. 2001). “If a literal reading of the statute leads to an absurd result, we resort to
extratextual factors to arrive at a sensible interpretation to effectuate the intent of the
legislature.” Griffith v. State, 116 S.W.3d 782, 785 (Tex. Crim. App. 2003).
In this case, the State failed to meet its burden of proof on four out of the six
violations alleged at the hearing. Nevertheless, pursuant to the literal meaning of Article
42A.751, the State was given an evidentiary advantage that it would not have enjoyed
had it solely alleged the two financial violations we now analyze. See TEX. CODE CRIM.
PROC. ANN. art. 42A.751(i). In other words, application of the plain meaning of the statute
rewarded the State for alleging additional violations that the trial court ultimately found
unconvincing. See id. This is an absurd result that the Legislature could not possibly have
intended.
Thus, we may consider the legislative history of Article 42A.751. See Boykin v.
State, 818 S.W.2d 782, 785–86 (Tex. Crim. App. 1991). In 2007, the Legislature shifted
the burden of proving financial ability from the defendant to the State. See Act of Sept. 1,
2007, H.B. 312, 80th Leg., R.S., ch. 604, 2007 TEX. GEN. LAWS 1160, repealed by Act of
Jan. 1, 2017, H.B. 2299, 84th Leg., R.S., ch. 770, § 1.01, 2015 TEX. GEN. LAWS 2321;
Lively v. State, 338 S.W.3d 140, 145 (Tex. App.—Texarkana 2011, no pet.). House Bill
312 was intended to “conform[] the statute to the requirements of the Due Process Clause
10
as interpreted by the United States Supreme Court in Bearden v. Georgia,” and “ensure
that a probationer[’]s inability to pay court costs due to economic constraints do[es] not
result in the costly and extraordinary sanction of prison.” House Comm. On Crim. Juris.,
Bill Analysis, Tex. H.B. 312, 80th Leg., R.S. (2007); see Bearden v. Georgia, 461 U.S.
660, 672–73 (1983) (holding that imprisoning a probationer for failing to pay “would be
contrary to the fundamental fairness required by the Fourteenth Amendment” if the trial
court did not also inquire into the reasons for the probationer’s failure to pay and consider
alternatives to imprisonment if the probationer failed to pay despite making “sufficient
bona fide efforts to acquire the resources to” pay). The Legislature cited as a concern that
over a third of probationers in Texas whose probation is revoked are sent “to prison for
failure to pay probation fines, or, in other words, are sentenced to prison for being poor.”
Id.
The word “only” in the ability-to-pay statute is a holdover term from a prior version,
which provided that an inability to pay was an affirmative defense the defendant must
prove “[i]n a probation revocation hearing at which it is alleged only that the probationer
violated conditions of the probation by failing to pay” fees. See Act of June 12, 1981, H.B.
865, 67th Leg., R.S., ch. 538, 1981 TEX. GEN. LAWS 2246, repealed by Act of Jan. 1, 2017,
H.B. 2299, 84th Leg., R.S., ch. 770, § 1.01, 2015 TEX. GEN. LAWS 2321. In interpreting
this prior version of the statute, the Texas Court of Criminal Appeals concluded that the
Legislature, having generally placed the burden on the probationer to show his inability
to pay, could not have contemplated that the word “only” would require the State to prove
the defendant’s ability to pay in cases where non-financial violations were also alleged.
11
See Stanfield v. State, 718 S.W.2d 734, 736 (Tex. Crim. App. 1986) (citing Newsom v.
State, 372 S.W.2d 681, 683 (Tex. Crim. App. 1963) (“[W]hen a literal enforcement would
lead to consequences which the legislature could not have contemplated, the courts are
bound to presume that such consequences were not intended and adopt a construction
which will promote the purpose for which the legislation was passed.”)). The Court instead
concluded that, “when failure to pay probation fees, court costs[,] and the like is an issue
in a revocation hearing, [the statute] is applicable regardless of whether a violation of
another condition of probation is alleged.” Id. at 737.
The Legislature transferred the burden of proof from the defendant to the State in
2007 but changed virtually nothing else in the statute. Compare Act of June 12, 1981,
H.B. 865, 67th Leg., R.S., ch. 538, 1981 TEX. GEN. LAWS 2246 (repealed 2017), with Act
of Sept. 1, 2007, H.B. 312, 80th Leg., R.S., ch. 604, 2007 TEX. GEN. LAWS 1160 (repealed
2017). What is good for the goose should be good for the gander. It would be manifestly
unjust to conclude that applications of the statute’s plain language were unreasonable
when holding so benefitted the State, but that its applications have now become
reasonable when they are detrimental to the defendant. Following Stanfield, we conclude
that the word “only,” as it appears in Article 42A.751(i), does not relieve the State of its
burden of showing the defendant’s ability to pay in cases such as this one, where non-
financial violations were alleged but financial violations were the only ones found true.
Instead, when failure to pay fees is an issue in a revocation hearing, Article 42A.751(i) is
applicable regardless of whether a violation of another condition of probation is alleged.
See Stanfield, 718 S.W.2d at 737; Brown v. State, 354 S.W.3d 518, 520 n.3 (Tex. App.—
12
Fort Worth 2011, pet. ref’d) (“The legislature’s use of the word ‘only’ in the statute is not
intended to lift the requirement that the State prove that the probationer was able to pay
and did not pay as ordered by the judge when the State includes additional allegations of
nonmonetary community supervision violations.”). Accordingly, to obtain revocation solely
on Scales’s failure to pay fees in this case, the State was required to prove his ability to
pay.3
“To consider a defendant’s ability to pay, a trial court may consider evidence of the
likely range of income, as well as likely living expenses or other liabilities, such as child
support orders.” Martinez, 563 S.W.3d at 515. “When evidence that the probationer is
unable to pay is not refuted by the State, and the trial court revokes community
supervision, it is an abuse of discretion.” Id. The State’s argument that Scales had the
ability to pay his community supervision fees was based on two expenditures made by
Scales. Specifically, the State argued that “on January 13th, 2021, [Scales] had
disposable income to be at Twin Peak[s],” and that Scales “had enough money to buy a
2020 Toyota Tundra, which is a fifty-one-thousand-dollar vehicle.” The State presented
no evidence of Scales’s average monthly income or his net resources.
Scales testified that he was “[g]etting food to go” “for [his] mom” when he was at
3 In two memorandum opinions, this Court previously stated that under Article 42A.751(i), the State
did not need to prove ability to pay when non-financial probation violations are also alleged. See Lopez v.
State, No. 13-18-00130-CR, 2019 WL 2381463, at *3 (Tex. App.—Corpus Christi–Edinburg June 6, 2019,
no pet.) (mem. op., not designated for publication); Farr v. State, No. 13-17-00297-CR, 2018 WL 4017118,
at *4 (Tex. App.—Corpus Christi–Edinburg Aug. 23, 2018, no pet.) (mem. op., not designated for
publication). However, in those cases, revocation was based on non-financial grounds as well as a failure
to pay. See Lopez, 2019 WL 2381463, at *4; Farr, 2018 WL 4017118, at *3. Accordingly, our statements in
those cases regarding the State’s need to prove ability to pay are non-binding dicta. See OIiva v. State,
548 S.W.3d 518, 524 (Tex. Crim. App. 2018) (“[L]anguage in an opinion can be dictum if it is broader than
necessary to resolve the case. This is so because a court might not have carefully considered fact situations
that vary substantially from the one before it.”).
13
Twin Peaks. There was no testimony as to how much the food cost, who ultimately paid
for the food, or what food, besides the non-alcoholic beer, was purchased. Additionally,
the evidence did not show that Scales paid $51,000 for his vehicle. Rather, the undisputed
evidence showed that he traded in his former car for $25,000 off the sticker price and took
out a loan to pay for the remaining balance on the Toyota Tundra. Scales testified that he
needed a new car because his old one “was falling apart.” At the time he purchased the
car, he assumed he would be able to afford it, and the evidence shows he did make a
“large payment” on his community supervision fees that month. However, “[t]he day after
[he] got that truck, [he] got laid off with COVID.” Scales testified that he had already
“missed a few” of his car note payments. The State did not refute this testimony. See
Hacker, 389 S.W.3d at 865 (Tex. Crim. App. 2013) (“Evidence does not meet [a
preponderance of the evidence] standard when ‘the evidence offered to prove a vital fact
is so weak as to do no more than create a mere surmise or suspicion of its existence’ or
when the finder of fact must ‘guess whether a vital fact exists.’”).
While Scales testified that he now had a “good job,” no evidence was presented
concerning his income. We have concluded in the past that “evidence of a source of
income, without more,” does not show “an ability to pay.” Martinez, 563 S.W.3d at 516.
The trial court had no evidence about Scales’s net monthly resources, but it did have
evidence that he had substantial debt in the form of car payments. Based on this, we
cannot conclude that there was sufficient evidence showing that Scales had the ability to
pay the assessed fees and costs. See id. Therefore, the trial court abused its discretion
by revoking Scales’s community supervision.
14
We sustain Scales’s first and second issues. Because we have held that the trial
court abused its discretion by revoking his community supervision based on insufficient
evidence, we need not analyze Scales’s remaining issues. See TEX. R. APP. P. 47.1.
III. CONCLUSION
We reverse the trial court’s judgment revoking Scales’s community supervision
and sentencing him to prison. Because Scales’s term of community supervision has
expired, we render judgment discharging Scales from community supervision for count
one. See Davis v. State, 591 S.W.3d 183, 194 (Tex. App.—Houston [1st Dist.] 2019, no
pet.).
GINA M. BENAVIDES
Justice
Publish.
TEX. R. APP. P. 47.2(b).
Delivered and filed on the
10th day of November, 2022.
15 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483406/ | NUMBER 13-21-00377-CV
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
IN THE MATTER OF THE MARRIAGE OF ROGELIO GUERRA AND
SUSAN RABEL GUERRA
On appeal from the 197th District Court
of Cameron County, Texas.
MEMORANDUM OPINION
Before Justices Benavides, Hinojosa, and Silva
Memorandum Opinion by Justice Benavides
We issued our original memorandum opinion in this case on August 18, 2022.
Appellant Rogelio “Rocky” Guerra (Rocky) has filed a motion for rehearing. See TEX. R.
APP. P. 49.1. We deny the motion for rehearing but withdraw our prior memorandum
opinion and judgment and substitute the following memorandum opinion and
accompanying judgment in their place.
Rocky appeals from a final decree of divorce that dissolved his marriage to
appellee Susan Rabel Guerra (Susan). By five multifarious issues, Rocky argues that the
trial court erred by: (1) mischaracterizing certain items of separate property as community
property, and vice versa; (2) dividing the community estate in a manner that was not just
and right; (3) incorrectly determining Rocky’s claims for reimbursement; (4) failing to
award him reasonable attorney’s fees; and (5) incorrectly determining post-judgment
motions. We affirm.
I. BACKGROUND
Rocky and Susan married on August 26, 2017. On May 2, 2019, Rocky filed for
divorce. After Rocky filed for divorce, Susan withdrew $24,000 from their joint bank
account and deposited it into a separate bank account. Rocky later amended his petition
to include multiple claims for reimbursement.
A final hearing was held on April 6, 2021, and the trial court signed its initial final
decree of divorce on June 2, 2021. In its original decree, the trial court granted, inter alia,
a $24,000 reimbursement award solely to Rocky. On June 23, 2021, Susan filed a motion
for reconsideration and clarification of the final decree of divorce. In her motion, Susan
asked the Court to modify its reimbursement $24,000 to $12,000.
The trial court held a hearing on Susan’s post-judgment motion on August 9, 2021.
At the hearing, over Rocky’s objection, the trial court granted Susan’s oral motion for
leave to modify her post-judgment motion to also include a request that the court confirm
Susan’s retirement accounts as her separate property.
On August 16, 2021, the trial court signed a “Corrected Amended Final Decree of
Divorce.” In this decree, the trial court divided the financial assets of the community estate
2
as follows:
Awarded to Susan: Awarded to Rocky:
• $54,812.36 from Susan’s • $54,812.39 from Susan’s
Nationwide retirement account; Nationwide retirement account;
• $2,751.00 from Susan’s Charles • $2,750.00 from Susan’s Charles
Schwab account; Schwab account;
• $2,666.41 from Susan’s Slavic • $2,666.42 from Susan’s Slavic
retirement account; retirement account;
• $233,717.50 from Rocky’s Dell • $919,946.76 from Rocky’s Dell
401(k) accounts; and 401(k) retirement account; and
• $40,563.45 from Rocky’s bank • $40,563.45 from Rocky’s bank
accounts. accounts.
The trial court also awarded the community estate a reimbursement credit of
$24,000, from which each party was entitled to $12,000. Thus, the total value of the
community estate was $1,376,849.74. Susan received a total of $346,510.72, or
approximately 25% of the community estate. Rocky received a total of $1,030,339.02, or
approximately 75% of the community estate. The trial court also confirmed Susan’s LPL
retirement account and her Follett retirement account as her separate property.
On September 15, 2021, Rocky filed a motion to correct, reform, or modify the
judgment. The court held a hearing on Rocky’s motion on October 18, 2021, but it was
overruled by operation of law on November 1, 2021.
This appeal followed.
II. CHARACTERIZATION OF PROPERTY
Rocky argues that the trial court incorrectly characterized certain items of his
separate property as belonging to the community estate and incorrectly confirmed certain
items of property as being Susan’s sole and separate property.
3
A. Applicable Law & Standard of Review
Separate property includes “property owned or claimed by the spouse before
marriage.” TEX. FAM. CODE ANN. § 3.001(1). Separate property is not subject to division in
a divorce. Cameron v. Cameron, 641 S.W.2d 210, 215 (Tex. 1982). However, “[p]roperty
possessed by either spouse during or on dissolution of marriage is presumed to be
community property.” TEX. FAM. CODE ANN. § 3.003(a). To rebut this presumption, the
party asserting an item of property is their separate property must prove this assertion by
“clear and convincing evidence.” Id. § 3.003(b). “‘Clear and convincing evidence’ means
the measure or degree of proof that will produce in the mind of the trier of fact a firm belief
or conviction as to the truth of the allegations sought to be established.” Id. § 101.007;
see Boyd v. Boyd, 131 S.W.3d 605, 611 (Tex. App.—Fort Worth 2004, no pet.).
“[C]onclusory or uncorroborated testimony that funds are separate property is insufficient
to rebut the community presumption, unless there is also evidence that traces the funds.”
In re Marriage of Nash, 644 S.W.3d 683, 697 (Tex. App.—Texarkana 2022, no pet.)
(quoting In re Marriage of Born, No. 06-08-00066-CV, 2009 WL 1010876, at *5 (Tex.
App.—Texarkana Apr. 16, 2009, no pet.) (mem. op.)) (alteration in original); see Zagorski
v. Zagorski, 116 S.W.3d 309, 316 (Tex. App.—Houston [14th Dist.] 2003, pet. denied).
“Tracing involves establishing the separate origin of the property through evidence
showing the time and means by which the spouse originally obtained possession of the
property.” Smith v. Smith, 22 S.W.3d 140, 144 (Tex. App.—Houston [14th Dist.] 2000, no
pet.).
We review a trial court’s ruling on the property division in a final decree of divorce
4
for an abuse of discretion. Kelly v. Kelly, 634 S.W.3d 335, 348 (Tex. App.—Houston [1st
Dist.] 2021, no pet.). “We must indulge every reasonable presumption in favor of the trial
court’s proper exercise of its discretion.” Wilson v. Wilson, 44 S.W.3d 597, 600 (Tex.
App.—Fort Worth 2001, no pet.). If a trial court mischaracterizes a spouse’s separate
property as community property, then the trial court abuses its discretion and reversibly
errs. Kelly, 634 S.W.3d at 348 (citing Sharma v. Routh, 302 S.W.3d 355, 360 (Tex. App.—
Houston [14th Dist.] 2009, no pet.)). However, “[i]f the trial court mischaracterizes
community property as separate property, that property does not get divided as part of
the community estate.” Id. at 349. “If the mischaracterized property has value that would
have affected the just and right division of the community estate, then the
mischaracterization is harmful, and we must remand the entire community estate for a
just and right division based upon the correct characterization of the property.” Id. “If the
mischaracterization of the property had only a de minimis effect on the just and right
division, then we need not remand the case to the trial court.” Id.
B. Analysis
1. Rocky’s Dell 401(k) Account
The trial court characterized the entirety of Rocky’s Dell 401(k) as community
property. On appeal, Rocky asserts that the “community’s total interest in the Dell 401(k)
account” consists solely of the “$124,493.76 in employee contributions, $33,381.67 in
employer contributions, and $67.72 in dividends and interest, for an aggregate total of
$157,943.15.”
Prior to 2005, Texas common law ignored tracing principles when the asset at
5
issue was a defined contribution retirement account, like Rocky’s Dell 401(k). See, e.g.,
Pelzig v. Berkebile, 931 S.W.2d 398 (Tex. App.—Corpus Christi–Edinburg 1996, no writ);
Hatteberg v. Hatteberg, 933 S.W.2d 522 (Tex. App.—Houston [1st Dist.] 1994, no writ).
Instead, Texas appellate courts looked solely to the increase in value of the retirement
account during the marriage, regardless of whether that increase could be linked to
separate property. See, e.g., Pelzig, 931 S.W.2d at 402; Hatteberg, 933 S.W.2d at 531.
In 2005, however, the Legislature enacted § 3.007 of the Texas Family Code, and defined
contribution plans became subject to the same tracing rules that apply to nonretirement
assets. See Act of Sept. 1, 2005, 79th Leg., R.S., ch. 490, § 1, 2005 TEX. GEN. LAWS
1353–54 (amended 2009) (current version at TEX. FAM. CODE ANN. § 3.007(c)); see also
Goyal v. Hora, No. 03-19-00868-CV, 2021 WL 2149628, at *12 (Tex. App.—Austin May
27, 2021, no pet.) (mem. op.).
Thus, like any other asset, if Rocky failed to adequately trace the portions of the
Dell 401(k) that he claimed were his separate property and “the evidence shows separate
and community property have been so commingled as to defy resegregation and
identification,” then Rocky failed to rebut the presumption that the entirety of the Dell
401(k) was community property. See Zagorski, 116 S.W.3d at 316. “The only requirement
for tracing . . . is that the party attempting to overcome the community presumption
produce clear evidence of the transactions affecting the commingled account.” Welder v.
Welder, 794 S.W.2d 420, 434 (Tex. App.—Corpus Christi–Edinburg 1990, no writ). To
adequately trace the assets in his retirement account, Rocky was required to provide clear
evidence of the amount and character of each transaction affecting his Dell 401(k), as
6
well as show whether the balance in his account dipped below the value of his separate
property balance. See Smith, 22 S.W.3d at 146; Snider v. Snider, 613 S.W.2d 8,10 (Tex.
App.—Dallas 1981, no writ); see also Goyal, 2021 WL 2149628, at *16.
The record shows that Rocky’s Dell 401(k) had a balance of $686,229.27 at the
time of marriage and that it had a balance of $1,214,778.81 at the time of the final hearing.
However, a statement for the month of March 2020 shows that Rocky sold and bought
$537,745.51 worth of shares in his Dell 401(k). By that point, Rocky had consistently
contributed to his account during the marriage, and a portion of the $537,745.51 was
community property.
The increase in value of any assets within the Dell 401(k) that were purchased
prior to marriage that was due to market fluctuations alone would be Rocky’s separate
property. See Jensen v. Jensen, 665 S.W.2d 107, 108–10 (Tex. 1984). However, there
was no clear evidence presented demonstrating which new assets were acquired in
March of 2020 with his separate property shares and which assets were acquired with
the community estate’s shares. See Welder, 794 S.W.2d at 434. Without this evidence, it
is not possible to determine the true character of the newly acquired shares. See Smith
v. Lanier, 998 S.W.2d 324, 332 n.7 (Tex. App.—Austin 1999, pet. denied); see also In re
J.Y.O., No. 05-20-00987-CV, 2022 WL 2071113, at *7 (Tex. App.—Dallas June 9, 2022,
no pet. h.) (mem. op.); Sanchez v. Wales, No. 05-20-00485-CV, 2022 WL 1055376, at
*6–7 (Tex. App.—Dallas Apr. 8, 2022, no pet.) (mem. op.); Goyal, 2021 WL 2149628, at
*13; In re Marriage of Born, 2009 WL 1010876, at *3; Lee v. Novak, No. 03-00-00143-
CV, 2001 WL 391530, at *5 (Tex. App.—Austin Apr. 19, 2001, no pet.) (mem. op.). Thus,
7
Rocky failed to rebut the presumption that the newly acquired assets were community
property because the community and separate property portions of those assets were “so
commingled as to defy resegregation and identification.” See Zagorski, 116 S.W.3d at
316. Because Rocky did not clearly trace this exchange, he failed to rebut the
presumption that the assets purchased in March of 2020 were community property. See
McKinley v. McKinley, 496 S.W.2d 540, 543 (Tex. 1973); Kelly, 634 S.W.3d at 349.
These new assets were worth approximately $576,236.56 on March 30, 2021.
Additional shares of other assets were acquired with the contributions that Rocky and his
employer made during the marriage, and the increase in value of those shares therefore
also had a community property interest. We conclude that Rocky has failed to show that
he was harmed by the trial court awarding him $919,946.76 from the Dell 401(k). When
a trial court errs in characterizing separate property as community property but does not
divest the party of his separate property, the party appealing must establish the
mischaracterization as harmful. See Tate v. Tate, 55 S.W.3d 1, 6–7 (Tex. App.—El Paso
2000, no pet.); see also Dean-Groff v. Groff, No. 13-06-085-CV, 2007 WL 3293540, at *2
(Tex. App.—Corpus Christi–Edinburg Nov. 8, 2007, no pet.) (mem. op.) (“However, when
the trial court errs in characterizing separate property as community property but does
not divest the party of her separate property, on appeal the party must establish that the
error was harmful.”). At a minimum, the community’s interest in the Dell 401(k) was
$576,236.56. Susan was awarded less than half this amount. Rocky has thus failed to
show how he was harmed by this award.
We conclude that the trial court did not err in its division of Rocky’s Dell 401(k).
8
2. Susan’s Follett Account
Rocky argues that Susan did not trace the funds in her Follett retirement account,
and therefore, no evidence exists that Susan’s account contained any separate property.
“The separate property interest of a spouse in a defined contribution retirement
plan may be traced using the tracing and characterization principles that apply to a
nonretirement asset.” Id. § 3.007(c). Susan testified that she started a new job prior to the
parties’ marriage and ceased making contributions to her Follett retirement account. It is
true that Susan did not introduce any evidence for her Follett account. However, Rocky
essentially shouldered that burden for her by introducing Susan’s Follett account
statements as evidence. These statements, like Rocky’s, chronicle the value of the Follett
retirement account beginning prior to the parties’ marriage. They show that prior to
marriage, on July 1, 2017, Susan had $246,623.28 in her Follett account and on
September 30, 2017, Susan had $256,857.92. The most recent statement admitted into
evidence showed that Susan’s Follett account had a final value of $320,828.09.
However, unlike Rocky’s statements, Susan’s showed that neither she nor her
former employer contributed to the Follett account during the period immediately prior to
the parties’ marriage or at any point during the marriage. These statements therefore
corroborate Susan’s testimony and show that the increase in value of her separate
property retirement account was due to market fluctuations alone. Jensen, 665 S.W.2d
at 108, 110; Zagorski, 116 S.W.3d at 316–17.
Therefore, we conclude that the trial court did not err in categorizing this account
in its entirety as Susan’s separate property.
9
3. Susan’s LPL Account
Rocky argues that the trial court abused its discretion by confirming Susan’s LPL
account as her separate property. In her testimony, Susan stated that she owned this
account prior to the marriage, and she also testified that she did not contribute to this
account during the marriage. But there was no documentary or other supporting evidence
as to the account’s value either before or during the marriage. Generally, uncorroborated
testimony alone is insufficient to rebut the presumption that property owned at the end of
a marriage is community property. See In re Marriage of Nash, 644 S.W.3d at 697; Viera
v. Viera, 331 S.W.3d 195, 208 (Tex. App.—El Paso 2011, no pet.); Bush, 336 S.W.3d at
743; Boyd, 131 S.W.3d at 615; Ganesan v. Vallabhaneni, 96 S.W.3d 345, 354 (Tex.
App.—Austin 2002, pet. denied); Osorno v. Osorno, 76 S.W.3d 509, 512 (Tex. App.—
Houston [14th Dist.] 2002, no pet.); but see Pace v. Pace, 160 S.W.3d 706, 714 (Tex.
App.—Dallas 2005, pet. denied) (“The testimony of a spouse seeking to overcome the
community property presumption need not be corroborated to meet the clear and
convincing standard. . . . However, a party’s unsupported and contradicted testimony
may not meet the clear and convincing standard.”). The only evidence in the record as to
the origin of Susan’s LPL account was her testimony. Therefore, Susan failed to rebut the
presumption that this account was community property. See Viera, 331 S.W.3d at 208.
Because the trial court had insufficient information upon which to exercise its discretion,
it abused its discretion. See Watson v. Watson, 286 S.W.3d 519, 525 (Tex. App.—Fort
Worth 2009, no pet.).
However, our analysis does not stop here. We still must determine whether the
10
trial court’s mischaracterization of the LPL account led to a division of the community
estate that was manifestly unjust or unfair. See Viera, 331 S.W.3d at 208. While a trial
court reversibly errs by characterizing separate property as community property, it does
not necessarily similarly err by characterizing community property as separate property.
See In re Marriage of Moncey, 404 S.W.3d 701, 706 (Tex. App.—Texarkana 2013, no
pet.). “A trial court does not abuse its discretion if the mischaracterization has but a de
minimus effect on the division of the community estate.” Viera, 331 S.W.3d at 208.
On appeal, Rocky asks this court to “render that Susan and Rocky be
awarded . . . $30,908.59 each from the LPL account.” However, he cites to no place in
the record, nor can we find one, where evidence was presented concerning the value of
the LPL account at any point in time. Because there was no evidence presented to show
the value of the LPL account, we cannot say that Rocky has met his burden of proving
that the trial court’s mischaracterization had anything other than a de minimus effect on
the division of the community estate. See id. at 208; Todd v. Todd, 173 S.W.3d 126, 129
(Tex. App.—Fort Worth 2005, pet. denied). Therefore, the trial court did not abuse its
discretion by confirming Susan’s LPL account as her separate property.
We conclude by overruling this issue.
III. DIVISION OF COMMUNITY PROPERTY1
Rocky contends that the trial court omitted certain property from its division of the
1 In her brief, Susan also raises various issues concerning the trial court’s division of property.
However, Susan did not file a notice of appeal. Therefore, the issues raised by Susan in her brief are outside
the scope of this appeal and we may not consider them. See TEX. R. APP. P. 25.1(c); Reich & Binstock,
L.L.P. v. Scates, 455 S.W.3d 178, 185 (Tex. App.—Houston [14th Dist.] 2014, pet. denied); see also Locke
v. Briarwood Vill., No. 14-17-00113-CV, 2018 WL 5621379, at *4 (Tex. App.—Houston [14th Dist.] Oct. 30,
2018, no pet.) (mem. op.).
11
community estate, and therefore, its division of the community property was not just and
right.
A. Applicable Law & Standard of Review
In a divorce decree, the trial court “shall order a division of the estate of the parties
in a manner that the court deems just and right, having due regard for the rights of each
party and any children of the marriage.” TEX. FAM. CODE ANN. § 7.001. In making this
division, “[a] trial court should consider many factors, including ‘the spouses’ capacities
and abilities . . . and the nature of the property.’” Bradshaw v. Bradshaw, 555 S.W.3d 539,
543 (Tex. 2018) (plurality op.) (quoting Murff v. Murff, 615 S.W.2d 696, 699 (Tex. 1981)).
We review a trial court’s division of community property for an abuse of discretion.
Banker v. Banker, 517 S.W.3d 863, 869 (Tex. App.—Corpus Christi–Edinburg 2017, pet.
denied). A trial court enjoys broad discretion, and its division of property “should be
corrected on appeal only where an abuse of discretion is shown in that the disposition
made of some property is manifestly unjust and unfair.” Bradshaw, 555 S.W.3d at 543
(quoting Hedtke v. Hedtke, 248 S.W. 21, 23 (Tex. 1923)). Our inquiry into whether a trial
court abused its discretion requires a two-pronged analysis: (1) did the trial court have
sufficient information upon which to exercise its discretion, and (2) did the trial court abuse
its discretion by dividing the community estate in a manner that was manifestly unjust or
unfair? Viera, 331 S.W.3d at 203.
B. Analysis
1. Susan’s Bank Account
Rocky contends that the trial court omitted one of Susan’s bank accounts from its
12
division of the community estate, which resulted in an unjust division of property. As
Susan points out in her brief, however, Rocky’s brief did not cite to any part of the record
to help us identify the missing bank account. See TEX. R. APP. P. 38.1(i).
In his reply brief, Rocky cites to portions of the record in which Susan discussed
her Wells Fargo and USAA bank accounts. Susan testified that “[o]n the date of marriage,
[she] had [$]38,782.62 in” those accounts. However, she also testified that she “spent all
of that to pay for [her] home in San Antonio.” The trial court confirmed Susan’s home in
San Antonio as her separate property. Rocky also testified, and thus, judicially admitted,
that Susan brought approximately $38,000 in separate funds into the marriage and
depleted those funds to make payments on her separate property house. See Pace, 160
S.W.3d at 714; Dutton v. Dutton, 18 S.W.3d 849, 853–54 (Tex. App.—Eastland 2000,
pet. denied). Susan testified that she did not add any funds to these accounts once they
were emptied, and Rocky did not contradict this testimony.
Although property possessed at the end of the marriage is presumed to be
community property, there was no evidence before the trial court that this property still
existed. “Generally, a party who does not provide to the trial court any value for the
property cannot, on appeal, complain of the trial court’s lack of information in dividing the
community estate.” Wheeling v. Wheeling, 546 S.W.3d 216, 228 (Tex. App.—El Paso
2017, no pet.); see LeBlanc v. LeBlanc, 761 S.W.2d 450, 453 (Tex. App.—Corpus
Christi–Edinburg 1988), aff’d, 778 S.W.2d 865 (Tex. 1989) (holding that where an
appellant fails to provide values on any of the property to the trial court, he cannot on
appeal complain of the trial court’s lack of complete information in dividing or valuing that
13
property). Therefore, because no evidence was presented to suggest these accounts had
any value, the trial court did not err by failing to include these accounts in the community
estate. See Viera, 331 S.W.3d at 209.
We overrule this issue.
IV. CLAIMS FOR REIMBURSEMENT
Rocky argues that the trial court erred by: (1) modifying its reimbursement award
to provide $12,000 to Rocky instead of the initial $24,000 and (2) not granting his
additional claims for reimbursement.
A. Standard of Review & Applicable Law
Generally, “spouses are free to make expenditures of community property absent
some deception or objection by the other spouse.” Pelzig, 931 S.W.2d at 400. “A right of
reimbursement arises when the funds or assets of one estate are used to benefit and
enhance another estate without itself receiving some benefit.” Vallone v. Vallone, 644
S.W.2d 455, 459 (Tex. 1982). “The right of an estate to reimbursement from another
estate is an equitable right and should be determined by equitable principles.” Anderson
v. Gilliland, 684 S.W.2d 673, 675 (Tex. 1985); see TEX. FAM. CODE ANN. § 3.402(b). We
review a trial court’s determination of claims for reimbursement for an abuse of discretion,
and “great latitude must be given to the trial court in applying equitable principles to value
a claim for reimbursement.” Penick v. Penick, 783 S.W.2d 194, 198 (Tex. 1988). The
party claiming the right of reimbursement bears the burden of proof. Id. at 197.
14
B. Analysis
1. Downward Modification of Reimbursement Award
In its original decree, the trial court ordered Susan to reimburse Rocky for $24,000;
the amount she took out of the parties’ joint bank account after Rocky filed for divorce. In
its amended final decree, the trial court ordered Susan to reimburse the community estate
for $24,000, with each party to receive $12,000. See TEX. FAM. CODE ANN. § 3.402(8). A
claim for reimbursement “create[s] a claim against the property of the benefited estate by
the contributing estate.” Id. § 3.404(b). Because Susan’s individual estate was benefited
by the community estate, the trial court correctly modified its judgment by finding that
Susan owed a claim of reimbursement to the community estate. See id.; see also DeGroot
v. DeGroot, 260 S.W.3d 658, 662 (Tex. App.—Dallas 2008, no pet.) (“During the period
of a trial court’s plenary power, its power to modify its judgment is virtually absolute.”).
However, Rocky complains that the trial court should have awarded the entirety of
the $24,000 to him alone instead of dividing the award equally between the parties. Citing
no authority, Rocky argues that “[s]uch ruling by the court was error and an abuse of
discretion because the evidence showed that the trial court had sufficient reasons to have
credited Rocky the $24,000.”
In a divorce decree, the trial court must determine the rights of both spouses to a
claim for reimbursement and can “order a division of the claim for reimbursement, if
appropriate, in a manner that the court considers just and right, having due regard for the
rights of each party.” Id. § 7.007(2). Here, the trial court determined that it was the
community estate, not Rocky’s separate estate, that was ostensibly harmed by Susan
15
secreting $24,000 worth of community funds into a separate bank account. Therefore, it
was the community estate, not Rocky’s separate estate, that was entitled to a
reimbursement of $24,000. See id. § 3.404(b).
The trial court stated in its decree that its award for reimbursement was “part of the
division of community property between the parties,” and it also determined that its
division of community property was “just and right.” Rocky received approximately 75%
of the total community estate, and Susan received approximately 25%. Because the trial
court’s determination deserves wide latitude, and because the trial court did not err by
awarding the community estate $24,000, we conclude the trial court did not abuse its
discretion in its disposition of this reimbursement award. See Schlueter v. Schlueter, 975
S.W.2d 584, 589 (Tex. 1998).
2. Miscellaneous Reimbursement Claims
Rocky argues that the trial court erred by failing to reimburse him for Susan’s
“wasteful spending of the community estate.” Specifically, he states that “Susan spent
$124,666.73 in self-care and personal items like purses and shoes.”
During his testimony, Rocky testified to Susan’s expenditures as follows:
Target was about 25,000-and-change, $25,686.74. Spa, I know she had
$4,297.66. She spent a lot of money on IKEA, $6,987. Her—her pets, we
had—when we were together, she had two—two dogs and a cat, and she
spent $2,400 on that. Fitness. And a lot of this was done over COVID. But
she was going to yoga and fitness and spent over $2,768.05.
Massage/acupuncture. She had never done acupuncture in the time we
were together. She spent $7,973.83.
Rocky testified that these expenses totaled “$166,666.73.” In adding these figures
ourselves, we do not reach nearly the same sum. Regardless, Rocky did not testify that
16
these expenses enhanced Susan’s separate estate in any way. See Vallone, 644 S.W.2d
at 459. Susan testified that she “spent money on massages for both” herself and Rocky.
She also testified that Rocky made negative comments about her appearance and that
was why she sought certain beauty treatments. Rocky did not detail what many of these
miscellaneous expenses at Target, IKEA, and other stores were, and we see no evidence
in the record that these expenses were not for the benefit of the community. See Pelzig,
931 S.W.2d at 400. Therefore, we conclude that Rocky did not meet his burden to prove
that the expenses were reimbursable. See Penick, 783 S.W.2d at 197.
Rocky also claims the trial court erred by not awarding him a reimbursement award
because “Susan also spent $42,000 on in[ ]vitro fertilization treatments after she and
Rocky had separated and filed for divorce.” However, bearing in mind that the rule of
reimbursement is ultimately an equitable one and that the trial court has broad discretion
in rejecting such claims, we conclude that the trial court did not err by denying Rocky’s
additional claims for reimbursement. See id. at 198.
V. ATTORNEY’S FEES
Finally, Rocky argues that the trial court erred by failing to award him reasonable
and necessary attorney’s fees.
A. Standard of Review & Applicable Law
Generally, a party has no inherent right to recover attorney’s fees from another
party “unless there is specific statutory or contractual authority allowing it.” Rohrmoos
Venture v. UTSW DVA Healthcare, LLP, 578 S.W.3d 469, 487 (Tex. 2019). “In a suit for
dissolution of a marriage, the court may award reasonable attorney’s fees and expenses.”
17
TEX. FAM. CODE ANN. § 6.708(c). “The ordinary meaning of ‘shall’ or ‘must’ is of a
mandatory effect, whereas the ordinary meaning of ‘may’ is merely permissive in nature.”
Chavez v. McNeely, 287 S.W.3d 840, 844 (Tex. App.—Houston [1st Dist.] 2009, no pet.);
Tri-Star Petroleum Co. v. Tipperary Co., 107 S.W.3d 607, 615 (Tex. App.—El Paso 2003,
pet. denied). We review a trial court’s award of attorney’s fees for an abuse of discretion.
In re Marriage of Mobley, 503 S.W.3d 636, 645 (Tex. App.—Texarkana 2016, pet.
denied).
B. Analysis
Rocky cites to Russell v. Russell for his contention that attorney’s fees were
mandatory in this case. 478 S.W.3d 36, 50 (Tex. App.—Houston [14th Dist.] 2015, no
pet.) (“An award of no fees is improper in the absence of evidence affirmatively showing
that no attorney’s services were needed or that any services provided were of no value.”).
However, Russell is inapposite, as the statute at issue in that case was Texas Family
Code § 157.167, which requires an award of attorney’s fees. See id. at 43, 45–46 (“It is
undisputed that section 157.167 mandates an award of reasonable attorney’s fees and
costs if the trial court finds that a party has failed to make child support payments . . . .”);
TEX. FAM. CODE ANN. § 157.167.
The plain language of the statute at issue here gives the trial court discretion to
either award or deny reasonable attorney’s fees and expenses in a divorce decree.
Compare TEX. FAM. CODE ANN. § 6.708(c), with § 157.167. And “[a] trial court has broad
discretion in deciding whether to award reasonable attorney’s fees in a suit for dissolution
of a marriage.” Seitz v. Seitz, 608 S.W.3d 272, 279 (Tex. App.—Houston [1st Dist.] 2020,
18
no pet.). Finding no authority that requires a trial court award reasonable attorney’s fees
under Texas Family Code § 6.708(c), we overrule this issue.
VI. POST-JUDGMENT MOTIONS
Lastly, Rocky argues that the trial court improvidently granted Susan’s post-
judgment motion. He also argues that the trial court erred by not granting his post-
judgment motion.
A. Standard of Review & Applicable Law
A trial court retains plenary power over a case for a minimum of thirty days after it
signs its final judgment. TEX. R. CIV. P. 329b. A court’s plenary power may be extended
by a party timely filing a motion for new trial or a motion to modify, correct, or reform the
judgment. Id. R. 329b(a), (e), (g). “[A] timely filed post[-]judgment motion that seeks a
substantive change in an existing judgment qualifies as a motion to modify under Rule
329b(g), thus extending the trial court’s plenary jurisdiction and the appellate timetable.”
Lane Bank Equip. Co. v. Smith S. Equip., Inc., 10 S.W.3d 308, 314 (Tex. 2000). “When
an appropriate post-judgment motion is filed within the initial thirty-day period, the trial
court’s plenary power over the judgment is extended up to an additional seventy-five
days, depending on when or whether the court acts on the motion.” Shackelford v. Barton,
156 S.W.3d 604, 607 (Tex. App.—Tyler 2004, pet. denied). “During the period of a trial
court’s plenary power, its power to modify its judgment is virtually absolute.” DeGroot, 260
S.W.3d at 662; see In re Provine, 312 S.W.3d 824, 829 (Tex. App.—Houston [1st Dist.]
2009, orig. proceeding).
We review a trial court’s decision to grant or deny a post-judgment motion that
19
seeks a substantive change in the existing judgment for an abuse of discretion. See Soto
v. Gen. Foam & Plastics Corp., 458 S.W.3d 78, 81 (Tex. App.—El Paso 2014, no pet.).
B. Analysis
1. Susan’s Post-Judgment Motion
Rocky contends that the trial court abused its discretion by amending its original
decree based on grounds not included in Susan’s post-judgment motion. The trial court
signed its original decree of divorce on June 2, 2021. On June 23, 2021, Susan filed a
motion for reconsideration and clarification of the final decree of divorce. In her motion,
Susan asked the trial court to modify its reimbursement award of $24,000 to Rocky to
$12,000.
However, at a hearing on her motion on August 9, 2021, Susan made an oral
motion to modify her post-judgment motion and asked that the trial court reconsider its
characterization of Susan’s retirement accounts. The trial court granted this request
despite Rocky’s objections that: (1) this issue was not included in Susan’s written motion,
and (2) any amendment to Susan’s post-judgment motion would be untimely. Rocky
urges on appeal that the trial court erred by granting the relief Susan requested over his
objections.
We need not address whether either objection should have been sustained,
however, as “the trial court may, at its discretion, consider the grounds raised in an
untimely motion and grant a new trial under its inherent authority before the court loses
plenary power.” Moritz v. Preiss, 121 S.W.3d 715, 720 (Tex. 2003). Further, the trial court
“has authority sua sponte to modify the judgment within the duration of its plenary power.”
20
Horseshoe Bay Resort Sales Co. v. Lake Lyndon B. Johnson Imp. Corp., 53 S.W.3d 799,
815 (Tex. App.—Austin 2001, pet. denied); see In re I.L., 580 S.W.3d 227, 244 (Tex.
App.—San Antonio 2019, pet. dism’d). Therefore, even if the trial court erred by granting
Susan leave to amend her motion for reconsideration, it was still permitted to amend its
decree on the grounds Susan raised at the hearing. See Horseshoe Bay Resort Sales
Co., 53 S.W.3d at 815; Dewey v. Dewey, 745 S.W.2d 514, 516 (Tex. App.—Corpus
Christi–Edinburg 1988, writ denied) (“Even if appellee had limited her request to the issue
of property division, the court, in granting a new trial, would not have been restricted to
the grounds set forth in the motion for new trial.”).
We are generally not permitted to disturb a trial court’s judgment unless the error
complained of “probably caused the rendition of an improper judgment.” TEX. R. APP. P.
44.1(a)(1). Here, because the trial court had the authority to consider the issues raised
by Susan and modify its judgment based on those issues, any error in granting Susan
leave to amend her motion or considering an untimely motion did not likely cause the
rendition of an improper judgment. See Diaz v. Diaz, 350 S.W.3d 251, 256 (Tex. App.—
San Antonio 2011, pet. denied) (“Under an abuse of discretion standard, we will not
reverse the trial court’s judgment if the trial court reaches a correct result even for a wrong
reason.”).
2. Rocky’s Post-Judgment Motion
Rocky also argues that the trial court erred by not granting his post-judgment
motion. At the hearing on Rocky’s post-judgment motion, the following exchange took
place between the court and Rocky’s counsel:
21
[THE COURT]: . . . But with regards to the motion that you have
filed, . . . I’ve looked at what you said, and I’m
not going to argue that not everything in there
that you say does or does not have merit. I’m
not arguing that at this point in time. But just
having looked at everything that has occurred in
this matter, it pains me to say this, but it almost
seems like, based on what you’re requesting
and the amount of changes that you’re asking
for, that this is fraught and ready for, perhaps,
just a new trial on this matter and having this
whole thing re-litigated.
....
[THE COURT]: . . . I’d like to, rather than take things piecemeal,
because you’ve—you’ve brought the motion to
reform the judgment, I want to focus specifically
on the question that I had for you in starting this
process today, which is why I took the time to
address it. But I’ve looked at your motion. And
we’d just start all over again with a clean slate.
So yea or nay to that?
[ROCKY’S COUNSEL]: I don’t think that’s an equitable resolution of the
problem, because of the fact that at trial, we did
trace our separate property.
....
[ROCKY’S COUNSEL]: And there is no motion for new trial on file. And
the Court, also, granted relief to the respondent
beyond the motion for reconsideration, which is
completely against the Dewey versus Dewey
case.
....
[THE COURT]: So[,] the answer to my question is, no, you don’t
want to?
[ROCKY’S COUNSEL]: Right.
....
22
[ROCKY’S COUNSEL]: I believe that [the court should] reconsider or we
should take it to the Court of Appeals.
The trial court did not rule on Rocky’s post-judgment motion, and it was overruled
by operation of law on November 1, 2021. See TEX. R. CIV. P. 329b(c). We cannot
conclude that the trial court acted arbitrarily or unreasonably in not granting Rocky’s
motion. Rocky essentially issued the trial court an ultimatum; it had to either give Rocky
exactly what he wanted, no half-measures, or Rocky would appeal the trial court’s
decision. In Rocky’s post-judgment motion, he complained of the same issues he now
complains of on appeal. As was discussed, Rocky is not entitled to the relief he is seeking.
Having analyzed the issues in Rocky’s post-judgment motion, we conclude that the trial
court did not abuse its discretion by allowing it to be overruled by operation of law. See
Soto, 458 S.W.3d at 81.
We overrule this issue.
VII. CONCLUSION
We affirm the trial court’s judgment.
GINA M. BENAVIDES
Justice
Delivered and filed on the
10th day of November, 2022.
23 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483398/ | NO. 12-22-00266-CV
IN THE COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT
TYLER, TEXAS
§ APPEAL FROM THE
IN THE MATTER OF THE ESTATE
§ COUNTY COURT AT LAW
OF WILLIAM EUGENE GLEGHORN
§ VAN ZANDT COUNTY, TEXAS
MEMORANDUM OPINION
PER CURIAM
Connie Gleghorn Odic filed a petition to contest the validity of the will admitted to
probate and a request for a temporary injunction in the Estate of William Eugene Gleghorn.
Odic is Gleghorn’s granddaughter. She alleged that the will should be set aside due to
Gleghorn’s lack of testamentary capacity and, alternatively, undue influence exerted by
Jacqueline Moore Gleghorn, independent executor of the Estate, and Porfirio Herrera. She
further sought revocation of letters testamentary issued to Jacqueline. Jacqueline filed an
original answer and counterclaim, in which she sought (1) actual damages, given Odic’s bad
faith pursuit of appointment as Gleghorn’s guardian, (2) damages for malicious prosecution,
abuse of process, and inovation of privacy, and (3) a declaratory judgment confirming that Odic
“by her conduct forfeited any right she has under Decedent’s Will, together with reasonable
attorneys’ fees and costs.” On April 6, 2022, Odic filed an amended petition to contest the
validity and enforceability of the will, which she alleged was wrongfully admitted to probate,
along with a request for a temporary and permanent injunction. She listed Jacqueline, Porfirio
Herrera, Wynne & Wynne, B. Prater Monning, III, Tammie Harp, and Beatriz Gonzalez as
parties. Odic added a request for an accounting and appointment of an independent auditor, and
alleged a violation of the Texas Uniform Fraudulent Transfer Act, unjust enrichment,
conversion, and conspiracy.
1
Wynne & Wynne, Monning, Harp, and Gonzalez subsequently filed a motion to dismiss
pursuant to the Texas Citizens Participation Act (TCPA), requested sanctions against Odic and
her counsel, Aamer Ravji, and sought additional sanctions in the form of dismissal of Odic’s
entire contested case. On September 2, the trial court granted the motion and found as follows:
The claims asserted against Defendants in this cause by Connie Odic (“Petitioner”), in filings by
Aamer Ravji (“Petitioner’s Counsel”), are based on and in response to Defendants’ exercise of the
right to petition. But Petitioner failed to establish by clear and specific evidence a prima facie case
for each essential element of her claims against Defendants. And Defendants established the
affirmative defense of attorney immunity on which they are entitled to judgment as a matter of
law. Furthermore, Petitioner’s claims were brought to deter or prevent Defendants from exercising
constitutional rights and were brought for an improper purpose, including to harass or to cause
unnecessary delay or to increase the cost of litigation, the factual contentions against Defendants
lacked evidentiary support, and Petitioner’s Counsel did not employ due diligence to determine
whether those claims indeed had evidentiary support.
The trial court found $45,912.24 to be a reasonable amount of attorney’s fees incurred for
responding to Odic’s claims and found that Odic’s application for guardianship was filed for an
improper purpose. The trial court (1) dismissed with prejudice all causes of action asserted
against Wynne & Wynne, Monning, Harp, and Gonzalez, (2) ordered Odic and Ravji to pay
$45,912.24 as reasonable attorney’s fees, plus court costs, pursuant to Chapters 10 and 27 of the
Texas Civil Practice & Remedies Code, (3) ordered Odic and Ravji to pay $21,318.78 in expert
witness fees, as additional sanctions, pursuant to Chapters 10 and 27, and (4) dismissed with
prejudice all Odic’s causes of action, “which the Court determines to be a sufficient sanction to
deter her from bringing similar actions in the future, pursuant to Section 27.009(a)(2)[.]” 1 Odic
and Ravji appealed.
Jacqueline, Herrera, Monning, Gonzalez, Harp, and Wynne & Wynne (Appellees) filed a
motion to dismiss the appeal, arguing that the dismissal order does not dispose of all parties or
issues because Jacqueline’s counterclaims remain pending and the TCPA does not permit an
interlocutory appeal of an order granting a TCPA motion to dismiss. They ask this Court to
dismiss the appeal, find the appeal frivolous, and award sanctions. In response, Odic and Ravji
assert that this is a probate case, the Estates Code governs jurisdiction, and their appeal arises
from a final order per the Estates Code. Specifically, they contend that:
1
If the trial court orders dismissal of a legal action under the TCPA, the court “may award to the moving
party sanctions against the party who brought the legal action as the court determines sufficient to deter the party
who brought the legal action from bringing similar actions described in this chapter.” TEX. CIV. PRAC. & REM.
CODE ANN. § 27.009(a)(2) (West 2020).
2
…a determination of the person entitled to serve as the executor of the estate is a final appealable
order. The trial court’s order dismissing Appellant Connie Gleghorn Odic’s will contest and
challenge to the appointment of Jacqueline Gleghorn as executor concludes “the phase of the
proceeding for which it was brought’”. The remaining issues before the trial court are Jacqueline
Gleghorn’s claims asserted in her capacity as executor, which are necessarily dependent on the
trial court’s decision that Ms. Jacqueline Gleghorn is the executor based on the will that is
contested. If (as Appellants contend) the trial court’s conclusion regarding the executor and
applicable will is erroneous, then all further proceedings in the trial court on the remaining issues
would likewise be erroneous. The order being appealed here is, thus, precisely the sort of
“controlling, intermediate decision” where “an error can harm later phases of the proceeding” that
explains why there is no “one final judgment rule” in the probate context.
A final order issued by a probate court is appealable to the court of appeals. TEX. EST.
CODE ANN. § 32.001(c) (West 2020). In probate appeals, if there is an express statute declaring
the phase of the probate proceedings to be final and appealable, that statute controls. Crowson v.
Wakeham, 897 S.W.2d 779, 783 (Tex. 1995). “Otherwise, if there is a proceeding of which the
order in question may logically be considered a part, but one or more pleadings also part of that
proceeding raise issues or parties not disposed of, then the probate order is interlocutory.” Id.
However, this case is unique in that Appellees moved for dismissal in the trial court
under Chapter 27 of the Texas Civil Practice and Remedies Code, i.e., the TCPA, and the trial
court dismissed Odic’s will contest under the TCPA. Thus, the order from which Odic and Ravji
appeal is an order granting a TCPA motion to dismiss, not an order ruling on the will contest.
Accordingly, the TCPA’s provisions govern our jurisdiction over this appeal. A party may file
an interlocutory appeal from the denial of a TCPA motion to dismiss. See TEX. CIV. PRAC. &
REM. CODE ANN. § 51.014(a)(12) (West Supp. 2022) (emphasis added). “If the trial court
timely grants the motion to dismiss, an order disposing of the entire case is appealable to the
same extent as any other final judgment.” In re Panchakarla, 602 S.W.3d 536, 538 (Tex. 2020)
(per curiam) (orig. proceeding). “But if granting the motion does not resolve the entire
controversy, the order is interlocutory and unappealable unless made final by severance.” Id.
The dismissal order does not dispose of Jacqueline’s counterclaim for a declaratory
judgment that Odic “by her conduct forfeited any right she has under Decedent’s Will[.]” Nor is
there any indication that the trial court granted a severance. Therefore, we conclude that the
order granting Appellees’ motion to dismiss under the TCPA is interlocutory and not appealable
at this juncture. See Panchakarla, 602 S.W.3d at 538; see also Hodge v. Carter, No. 03-21-
00675-CV, 2022 WL 14989763, at *1 (Tex. App.—Austin Oct. 27, 2022, no pet.) (mem. op.)
3
(dismissing for want of jurisdiction appeal from order granting TCPA motion to dismiss
appellant’s petitions against independent administrator of the estate, one of which included as a
defendant the purchaser of land sold by the estate administrator with the probate court’s
permission); In re Estate of Calkins, 580 S.W.3d 287, 294-96 (Tex. App.—Houston [1st Dist.]
2019, no pet.) (in appeal from denial of TCPA motion to dismiss filed in probate proceeding,
declining to address appellants’ first two issues, including application to probate will, because
they fell outside limited scope of interlocutory jurisdiction). For this reason, we grant
Appellees’ motion to dismiss and we dismiss the appeal for want of jurisdiction. We overrule
Appellees’ request for sanctions.
Opinion delivered November 9, 2022.
Panel consisted of Worthen, C.J., Hoyle, J., and Neeley, J.
4
COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT OF TEXAS
JUDGMENT
NOVEMBER 9, 2022
NO. 12-22-00266-CV
IN THE MATTER OF THE ESTATE OF
WILLIAM EUGENE GLEGHORN
Appeal from the County Court at Law
of Van Zandt County, Texas (Tr.Ct.No. 15,557)
THIS CAUSE came to be heard on the appellate record; and the same being
considered, it is the opinion of this Court that this appeal should be dismissed.
It is therefore ORDERED, ADJUDGED and DECREED by this Court that
this appeal be, and the same is, hereby dismissed for want of jurisdiction; and that this decision
be certified to the court below for observance.
By per curiam opinion.
Panel consisted of Worthen, C.J., Hoyle, J. and Neeley, J.
5 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483402/ | NO. 12-22-00200-CR
IN THE COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT
TYLER, TEXAS
KELWIN DABNEY, § APPEAL FROM THE 349TH
APPELLANT
V. § JUDICIAL DISTRICT COURT
THE STATE OF TEXAS,
APPELLEE § ANDERSON COUNTY, TEXAS
MEMORANDUM OPINION
Kelwin Dabney appeals the trial court’s order revoking his deferred adjudication
community supervision for the offense of prohibited item in a correctional facility. In one issue,
he argues that the trial court’s judgment contains certain clerical errors that require this Court to
reform the judgment. We modify the judgment, and affirm the judgment as modified.
BACKGROUND
Appellant was indicted for two counts of possession of a prohibited substance in a
correctional facility in Anderson County, Texas, alleged to have been committed on or about the
12th day of June, 2014. 1 The indictment contained enhancement allegations, which if proven,
elevated the punishment range from a third degree felony, punishable by not less than two nor
more than ten years of imprisonment, to a second degree felony, punishable by not less than two
nor more than twenty years of imprisonment. 2
1
See TEX. PENAL CODE ANN. § 38.11(j) (West Supp. 2022) (“A person commits an offense if the person,
while confined in a correctional facility, possesses a cellular telephone or other wireless communications device or a
component of one of those devices.”).
2
See id. §§ 12.33 (West 2019) (second degree felony punishment),12.34(a) (West 2019), (third degree
felony punishment), 12.42(a) (West 2019) (...if it is shown on the trial of a felony of the third degree that the
defendant has previously been finally convicted of a felony other than a state jail felony...on conviction the
Appellant entered a plea agreement with the State wherein he agreed to plead “guilty” to
one count in exchange for the State’s recommendation of ten years deferred adjudication
community supervision with a $1,500 fine and a dismissal of the second count in the indictment
and another pending charge. On June 24, 2016, Appellant entered his plea of “guilty” and the
trial court followed the State’s recommendation, deferred a finding of guilt, and placed Appellant
on community supervision for a period of ten years with a fine of $1,500 along with other terms
and conditions. The State filed motions to dismiss count two of the indictment and the other
pending case, which the trial court signed and ordered dismissed.
In March 2017, the State filed a motion to adjudicate Appellant’s guilt, and alleged
Appellant committed numerous violations of his community supervision. Appellant was
released on a surety bond pending a hearing on the State’s motion and absconded. Thereafter,
the surety asked the trial court to be released from the bond and surrender Appellant because
Appellant failed to report weekly and reply to mail correspondence. A warrant was issued for
Appellant’s arrest and he was brought before the trial court on June 10, 2022 for a hearing on the
State’s amended motion to adjudicate guilt.
Appellant pleaded “true” to committing the offense of resisting arrest while on
community supervision, failing to report, failing to pay supervision fees, failing to pay court
costs and the fine, and failing to pay the “crime stoppers” fee (allegations one, four, twenty,
twenty-one, and twenty-two, respectively). He pleaded “not true” to failing to report a change of
address to his community supervision officer and failing to perform community service
(allegations six and fifteen, respectively).
After accepting Appellant’s pleas of “true” and “not true,” the trial court heard evidence,
including the testimony of witnesses called by both the State and the defense. At the conclusion
of the hearing, the trial court found all the allegations in the State’s application to be “true,”
found Appellant “guilty” of the charged offense, and sentenced him to eight years of
imprisonment. This appeal followed.
defendant shall be punished for a felony of the second degree.”), 38.11(g) (“An offense under this section is a felony
of the third degree”).
2
ERRORS IN THE JUDGMENT
In one issue, Appellant argues that the trial court’s judgment adjudicating guilt contains
certain clerical errors and prays this Court reform the judgment to make it speak the truth.
Specifically, Appellant argues that the judgment
Incorrectly states the date of the charged offense as February 13, 2013, when the offense was
committed on June 12, 2014.
Incorrectly states that Appellant entered pleas of “true” to allegations six and fifteen, when he
actually pleaded “not true” to those allegations at the hearing.
Incorrectly states that Appellant entered into a plea bargain with the State for eight years of
imprisonment, when in fact, the Appellant and the State had no such agreement, and the
sentencing was left to the discretion of the trial court.
We have reviewed the record and conclude that Appellant is correct in his assertions.
We have the authority to modify the judgment to make the record speak the truth when
we have the necessary data and information to do so. Ingram v. State, 261 S.W.3d 749, 754
(Tex. App.—Tyler 2008, no pet.); Davis v. State, 323 S.W.3d 190, 198 (Tex. App.–Dallas 2008,
pet. ref’d). Moreover, Texas Rule of Appellate Procedure 43.2 expressly authorizes an appellate
court to modify the trial court’s judgment. TEX. R. APP. P. 43.2. In this case, the clerk’s record
and reporter’s record provide this Court with the necessary data and information to modify the
judgment to reflect that Appellant committed the offense on June 12, 2014, pleaded “true” to
allegations one, four, twenty, twenty-one, and twenty-two and “not true” to allegations six and
fifteen, and the case was not a plea bargain. See id.; see also Bigley v. State, 865 S.W.2d 26, 27–
28 (Tex. Crim. App. 1993); Asberry v. State, 813 S.W.2d 526, 529–30 (Tex. App.–Dallas 1991,
pet. ref’d). We sustain Appellant’s sole issue.
DISPOSITION
Having sustained Appellant’s sole issue, we modify the judgment to delete “February 13,
2013” as the Date of Offense and replace it with “June 12, 2014.” We further modify the
judgment to delete “true” under the Plea to Motion to Adjudicate and enter the correct pleas of
“true to allegations one, four, twenty, twenty-one, and twenty-two” and “not true to allegations
six and fifteen.” Finally, we modify the Terms of Plea Bargain to delete “In exchange for his
plea of true to the allegations set forth in the Motion to Adjudicate (and all amendments thereto),
3
the Defendant would be sentenced to a term of Eight (8) years in the Texas Department of
Criminal Justice—Institutional Division with credit” and replace it with “no plea bargain.” We
affirm the judgment as modified.
JAMES T. WORTHEN
Chief Justice
Opinion delivered November 9, 2022.
Panel consisted of Worthen, C.J., Hoyle, J., and Neeley, J.
(DO NOT PUBLISH)
4
COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT OF TEXAS
JUDGMENT
NOVEMBER 9, 2022
NO. 12-22-00200-CR
KELWIN DABNEY,
Appellant
V.
THE STATE OF TEXAS,
Appellee
Appeal from the 349th District Court
of Anderson County, Texas (Tr.Ct.No. 349CR-16-32,681)
THIS CAUSE came to be heard on the appellate record and the briefs filed
herein, and the same being considered, it is the opinion of this court that the judgment of the
court below should be modified and as modified, affirmed.
It is therefore ORDERED, ADJUDGED and DECREED that the judgment
of the court below be modified to delete “February 13, 2013” as the Date of Offense and replace
it with “June 12, 2014.” We further modify the judgment to delete “true” under the Plea to
Motion to Adjudicate and enter the correct pleas of “true to allegations one, four, twenty, twenty-
one, and twenty-two” and “not true to allegations six and fifteen.” We further modify the Terms
of Plea Bargain to delete “In exchange for his plea of true to the allegations set forth in the
Motion to Adjudicate (and all amendments thereto), the Defendant would be sentenced to a term
of Eight (8) years in the Texas Department of Criminal Justice—Institutional Division with
credit” and replace it with “no plea bargain.”; in all other respects the judgment of the trial court
is affirmed; and that this decision be certified to the court below for observance.
James T. Worthen, Chief Justice.
Panel consisted of Worthen, C.J., Hoyle, J., and Neeley, J. | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483411/ | NUMBER 13-21-00010-CV
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
SWIFT TRANSPORTATION
CO. OF ARIZONA, LLC, Appellant,
v.
GLENN HEGAR, COMPTROLLER
OF PUBLIC ACCOUNTS OF THE
STATE OF TEXAS; AND KEN
PAXTON, ATTORNEY GENERAL
OF THE STATE OF TEXAS, Appellees.
On appeal from the 200th District Court
of Travis County, Texas.
MEMORANDUM OPINION
Before Justices Longoria, Hinojosa, and Silva
Memorandum Opinion by Justice Silva
Appellant Swift Transportation Co. of Arizona, LLC (Swift) appeals the trial court’s
order granting summary judgment in favor of appellees Glenn Hegar, Comptroller of
Public Accounts of the State of Texas; and Ken Paxton, Attorney General of the State of
Texas, (collectively, the State). In this suit, Swift seeks to obtain a refund of the franchise
tax paid for tax years 2014 through 2016, arguing that an exemption from occupation
taxes for transportation businesses includes an exemption from franchise tax. See TEX.
TRANSP. CODE ANN. § 20.001. By two issues, Swift argues the trial court erred by granting
summary judgment because: (1) “occupation tax and franchise tax have the same plain
meaning”; and (2) “the franchise tax is measured by gross receipts.” We affirm.
I. BACKGROUND 1
Swift is a nationwide freight transportation company that does business in Texas.
In May 2018, Swift initiated administrative proceedings with the Comptroller, seeking a
refund claim for franchise tax paid for reporting years 2014 through 2016. 2 See TEX. TAX
CODE ANN. § 111.064. The Comptroller denied Swift’s request, prompting Swift to seek a
hearing before the State Office of Administrative Hearings. The presiding administrative
law judge issued a proposal for decision, denying Swift’s request. The Comptroller
accepted the proposal for decision with minor changes. Swift filed a motion for rehearing,
which was denied.
Swift then filed a petition in the district court. Each party filed traditional motions
for summary judgment. Swift sought a partial summary judgment declaring “that the
Texas franchise tax is an occupation tax measured by gross receipts,” thus exempting
1 This case is before this Court on transfer from the Third Court of Appeals in Austin pursuant to a
docket equalization order issued by the Supreme Court of Texas. See TEX. GOV’T CODE ANN. § 73.001.
Because this is a transfer case, we apply the precedent of the Austin Court of Appeals to the extent it differs
from our own. See TEX. R. APP. P. 41.
2 Swift sought a return of $979,742 plus interest.
2
Swift and other motor carriers from the franchise tax. See TEX. TRANSP. CODE ANN.
§ 20.001. The State requested the trial court to conclude the opposite, which would defeat
Swift’s claim altogether.
The trial court granted the State’s motion for summary judgment and denied Swift’s
motion, disposing of all parties and claims. This appeal followed.
II. STANDARD OF REVIEW AND APPLICABLE LAW
Swift takes the position that Texas Transportation Code § 20.001’s occupation tax
exemption creates a franchise tax exemption. See id. § 20.001 (“A motor bus carrier or
motor carrier transporting persons or property for hire is exempt from any occupation tax
measured by gross receipts imposed by any law of this state.”). Thus, the disposition of
this case hinges on whether the franchise tax is an occupation tax measured by gross
receipts.
Summary judgment is reviewed de novo. Berry v. Berry, 646 S.W.3d 516, 523
(Tex. 2022). “When both parties move for summary judgment and the trial court grants
one motion and denies the other, . . . we review both sides’ summary judgment evidence
and render the judgment the trial court should have rendered.” Rosetta Res. Operating,
LP v. Martin, 645 S.W.3d 212, 218 (Tex. 2022) (quoting S. Crushed Concrete, LLC v. City
of Houston, 398 S.W.3d 676, 678 (Tex. 2013)).
Whether a tax is an occupation tax is a matter of statutory interpretation. See Tex.
Ent. Ass’n, Inc. v. Combs, 431 S.W.3d 790, 797 (Tex. App.—Austin 2014, pet. denied).
“In construing a statute, our objective is to determine and give effect to the Legislature’s
intent.” Youngkin v. Hines, 546 S.W.3d 675, 680 (Tex. 2018) (quoting City of San Antonio
v. City of Boerne, 111 S.W.3d 22, 25 (Tex. 2003)). We seek to determine and give effect
3
to the legislature’s intent by considering the “act as a whole[,] rather than from isolated
portions.” Id. We utilize the enacted language of the statute, which includes any enacted
statements of policy or purpose. Id. If we cannot determine the legislature’s intent from
the plain and ordinary meaning, we “then consider the term’s usage in other statutes,
court decisions, and similar authorities.” EBS Sols., Inc. v. Hegar, 601 S.W.3d 744, 749
(Tex. 2020) (quoting Tex. State Bd. of Exam’rs of Marriage & Fam. Therapists v. Tex.
Med. Ass’n, 511 S.W.3d 28, 35 (Tex. 2017)). “We turn to extrinsic sources only if the
statute is ambiguous or if applying the statute’s plain meaning would produce an absurd
result.” EBS Sols., 601 S.W.3d at 749.
When, as here, we are evaluating the scope of a tax exemption, “we consider the
types of taxation that could have been contemplated by the legislature when it granted
the exemption.” United Servs. Auto. Ass’n v. Strayhorn, 124 S.W.3d 722, 728 (Tex.
App.—Austin 2003, pet. denied). Moreover, because tax exemptions “are the antithesis
of equality and uniformity and because they place a greater burden on other taxpaying
businesses and individuals,” we strictly construe tax exemptions against the taxpayer. Id.;
see AHF-Arbors at Huntsville I, LLC v. Walker Cnty. Appraisal Dist., 410 S.W.3d 831, 837
n.30 (Tex. 2012). The burden is on the claimant to prove that its claim comes within the
statutory exemption it seeks to apply. AHF-Arbors at Huntsville I, LLC, 410 S.W.3d at 837
n.30 (citing Bullock v. Nat’l Bancshares Corp., 584 S.W.2d 268, 271–72 (Tex. 1979)).
III. ANALYSIS
We disagree with Swift’s contention that the plain and ordinary meaning of
§ 20.001 includes an exemption for franchise tax. See Youngkin, 546 S.W.3d at 680; see
also TEX. TRANSP. CODE ANN. § 20.001. Accordingly, we must look to the usage of
4
“occupation tax” and “franchise tax” in other statutes, court authorities, and similar
authorities. See EBS Sols., Inc., 601 S.W.3d at 749.
Texas franchise and occupation taxes date back as early as 1880. See United
Servs. Auto. Ass’n, 124 S.W.3d at 725. When the Texas legislature passed § 20.001 in
its original form, both franchise and occupation taxes existed and were in effect. 3 See id.
at 728 (“When considering the scope of a tax exemption, we consider the types of taxation
that could have been contemplated by the legislature when it granted the exemption.”).
Further, in 1985, the legislature amended a statute by removing an exemption for
corporate “transportation companies” from franchise tax. See Acts of Apr. 3, 1985, 69th
Leg., R.S., ch. 30, §1, 1985 Tex. Gen Laws 405. Prior to the amendment, the statute
read: “A corporation that is an insurance company; surety, guaranty, or fidelity company;
transportation company; or sleeping, palace car, and dining company now required to pay
an annual tax measured by their gross receipts is exempted from the franchise tax.” Id.
The then-amended version thereafter read: “A corporation that is an insurance company;
surety, guaranty, or fidelity company not required to pay an annual tax measured by their
gross receipts is exempted from the franchise tax.” Id. The statute has since been
amended several more times. Indeed, the statute now contemplates a distinction between
occupation and franchise taxes: “A nonadmitted insurance organization that is subject to
an occupation tax or any other tax that is imposed for the privilege of doing business in
another state or a foreign jurisdiction, including a tax on gross premium receipts, is
3 Section 20.001 was originally passed in 1987 and subsequently recodified under the Texas Tax
Code in 1995. See Acts of May 28, 1987, 70th Leg., R.S., ch. 232, § 2, 1987 Tex. Sess. Law Serv. 232
(recodified as TEX. TRANSP. CODE ANN. § 20.001, Acts of May 21, 1997, 75th Leg., R.S., ch. 165, § 30.02,
sec. 20.01, 1997 Tex. Sess. Law Serv. Ch. 165 (S.B. 898)).
5
exempted from the franchise tax.” TEX. TAX CODE ANN. § 171.052(a). Further, each tax
applies to a business based on different classifications. See Tex. Ent. Ass’n, Inc., 431
S.W.3d at 798 (noting that the sexually-oriented-business tax was not a classification
based on the privilege of operating nude entertainment business in Texas, but rather to
offering nude entertainment while allowing alcohol consumption).
Although both taxes were in existence at the time the legislature passed § 20.001,
the legislature limited the express language to “any occupation tax,” and we presume this
legislative action was purposeful. See TEX. TRANSP. CODE ANN. § 20.001; Tex. Mut. Ins.
Co. v. Ruttiger, 381 S.W.3d 430, 452 (Tex. 2012) (“[T]his Court presumes the Legislature
deliberately and purposefully selects words and phrases it enacts, as well as deliberately
and purposefully omits words and phrases it does not enact.”); see also United Servs.
Auto. Ass’n, 124 S.W.3d at 728. We additionally note that when the legislature has
historically intended for a tax to be an occupation tax, it has identified the tax as such.
See Tex. Health Presbyterian Hosp. of Denton v. D.A., 569 S.W.3d 126, 136 (Tex. 2018)
(“[T]he Legislature expresses its intent by the words it enacts and declares to be the law.”
(quoting Molinet v. Kimbrell, 356 S.W.3d 407, 414 (Tex. 2011))); see, e.g., TEX. TAX. CODE
ANN. §§ 181.201 (classifying taxes on the manufacture, distribution, and sale of cement
products as an “occupation tax”), 191.121 (classifying taxes on oil well services as an
“occupation tax”), 201.401 (classifying a tax on natural gas production as an “occupation
tax”), 202.351 (classifying taxes on oil production as an “occupation tax”).
To support its argument that the Texas franchise tax is an occupation tax, Swift
primarily relies on two sources: (1) United Services Auto Association v. Strayhorn,
wherein the Third Court of Appeals described the franchise tax as “a type of occupation
6
tax,” see United Servs. Auto. Ass’n, 124 S.W.3d at 725 n.4; and (2) the Texas Supreme
Court’s assertion in In re Nestle USA, Inc. that there exist similarities between franchise
and occupation taxes. See In re Nestle USA, Inc., 387 S.W.3d 610, 619–21 (Tex. 2012)
(orig. proceeding); see also Bullock, 584 S.W.2d at 270 (“[A] franchise tax is imposed
upon all domestic and foreign corporations doing business in Texas.”); Conlen Grain &
Mercantile, Inc. v. Tex. Grain Sorghum Producers Bd., 519 S.W.2d 620, 624 (Tex. 1975)
(“An occupation tax is a form of excise tax imposed upon a person for the privilege of
carrying on a business, trade or occupation.”).
The United Services Auto Association court considered whether a tax exemption
for insurance companies exempted them from paying sales and use taxes. United Servs.
Auto. Ass’n, 124 S.W.3d at 727. In doing so, the court reviewed the history of taxation in
Texas from the late 1800s through the enactment of the statute in question—an insurance
code provision—in 1994. Id. at 724–27. The court noted that the legislature replaced
occupation taxes on insurance companies with a gross premium tax in 1893, and in a
footnote, the court described the franchise tax as “a type of occupation tax.” Id. at 725–
26, n.4. However, whether the franchise tax is an occupation tax—as asserted by Swift—
was not at issue in United Services Auto Association, nor was it necessary to the
outcome. See id. at 730–31. Consequently, the court’s footnote constitutes obiter dictum.
See Lund v. Giauque, 416 S.W.3d 122, 129 (Tex. App.—Fort Worth 2013, no pet.)
(“Obiter dictum is a statement not necessary to the determination of the case and that is
neither binding nor precedential.”); contra Seger v. Yorkshire Ins. Co., Ltd., 503 S.W.3d
388, 399 (Tex. 2016) (“Judicial dictum is ‘a statement made deliberately after careful
consideration and for future guidance in the conduct of litigation.’” (quoting Lund, 416
7
S.W.3d at 129)). As such, we are not bound by the Third Court of Appeal’s footnote
statement. See Seger, 503 S.W.3d at 399 (“Obiter dictum is not binding as precedent.”).
We additionally find Swift’s reliance on In re Nestle to be misplaced. In In re Nestle,
the Texas Supreme Court considered Nestle’s challenge to the Texas franchise tax as
violative of the Texas Constitution’s Equal and Uniform Clause. 4 In re Nestle USA, Inc.,
387 S.W.3d at 616. Nestle argued that the franchise tax was unconstitutional based on
its many deductions and exemptions. Id. In its consideration of Nestle’s claim, the court
compared constitutionally permissible classifications of various occupations, which led to
varying tax rates for different industries. Id. at 621. The court noted that “Black’s Law
Dictionary defines each the same way: a ‘tax imposed [for or on] the privilege of carrying
on a business[.]’” Id. at 621 n.99 (comparing BLACK’S LAW DICTIONARY 1595 (9th ed. 2009)
(franchise tax definition) with BLACK’S LAW DICTIONARY 1596 (9th ed. 2009) (occupation
tax definition)). However, as with the footnote in United Services Auto Association, the
comparison in In re Nestle exists as obiter dictum. See Seger, 503 S.W.3d at 399. The
central question in Nestle considered whether the franchise tax’s classifications,
deductions, and exemptions violated the Texas Constitution’s Equal and Uniform
Clause—not whether the franchise tax constitutes an occupation tax. See In re Nestle
USA, Inc., 387 S.W.3d at 621. Further, while the court noted the similarities between the
two, it did not go so far as to say the two taxes are the same. See id. In fact, the court
noted a significant distinction between the two: the franchise tax is imposed in exchange
for the privilege of the business operating as an entity that provides a liability shield
4The Equal and Uniform Clause states that “[t]axation shall be equal and uniform.” TEX. CONST.
amend. VIII, § 1(a).
8
whereas the occupation tax is imposed for privilege of doing business in a certain
occupation. Compare id. at 622, with Tex. Ent. Ass’n, Inc., 431 S.W.3d at 798.
Accordingly, we conclude In re Nestle does not create the precedent that Swift contends
it does.
Moreover, as the Texas Supreme Court noted in In re Nestle, the Equal and
Uniform Clause permits differing classifications for assessing taxes. 387 S.W.3d at 622.
The franchise tax and occupation tax each classify the businesses subject to their taxes
differently. For example, whether a business is subject to the franchise tax depends on
which entity the business chooses. See TEX. TAX. CODE ANN. §§ 171.0002 (defining
“taxable entity” for franchise taxes), 171.001 (imposing the franchise tax on each “taxable
entity” that does business in this state). On the other hand, occupation taxes are classified
by occupation and industry, regardless of the entity chosen. See, e.g., id. §§ 181.001–
181.202 (imposing occupation tax on the manufacture, distribution, and sale of cement
products), 191.081–191.122 (imposing occupation tax on oil well services), 201.001–
201.404 (imposing occupation tax on natural gas production), 202.001–202.354
(imposing occupation tax on oil production); see also Occupation, MERRIAM-
WEBSTER.COM DICTIONARY, https://www.merriam-webster.com/dictionary/occupation (last
visited Oct. 24, 2022) (defining occupation as “an activity in which one engages” or “the
principal business of one’s life”).
We decline to ascribe the precedential weight as propounded by Swift to the
authorities discussed supra. The legislature’s repeal of an exemption from franchise taxes
for corporate transportation companies demonstrates a discernible legislative intent to
exclude an exemption of transportation companies from franchise taxes. See Acts of Apr.
9
3, 1985, 69th Leg., R.S., ch. 30, § 1, 1985 Tex. Gen Laws 405 (to be codified as an
amendment to TEX. TAX CODE ANN. § 171.052); see also Youngkin, 546 S.W.3d at 680.
Finally, the current version § 171.052(a) shows a clear intent by the legislature to
differentiate between franchise and occupation taxes. See TEX. TAX. CODE ANN.
§ 171.052(a); EBS Sols., Inc., 601 S.W.3d at 749. We conclude that Texas Transportation
Code § 20.001’s exemption from the occupation tax does not include an exemption from
the franchise tax. Swift’s first issue is overruled.
Because we conclude the franchise tax is not an occupation tax, we do not need
to consider whether the franchise tax is measured by gross receipts. See TEX. R. APP. P.
47.4.
IV. CONCLUSION
We affirm the trial court’s judgment.
CLARISSA SILVA
Justice
Delivered and filed on the
10th day of November, 2022.
10 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483399/ | NO. 12-22-00236-CV
IN THE COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT
TYLER, TEXAS
IN THE INTEREST OF § APPEAL FROM THE 294TH
N.B. & P.B., § JUDICIAL DISTRICT COURT
CHILDREN § VAN ZANDT COUNTY, TEXAS
MEMORANDUM OPINION
In two issues, B.C. appeals the termination of her parental rights. We affirm.
BACKGROUND
B.C. is the mother and M.B. is the father of N.B. and P.B. 1 On February 12, 2021, the
Department of Family and Protective Services (the Department) filed an original petition for
protection of N.B. and P.B., for conservatorship, and for termination of B.C.’s and M.B.’s
parental rights. The Department was named temporary managing conservator of the children.
The parents were appointed possessory conservators with limited access to and possession of the
children.
Following a bench trial, the trial court found, by clear and convincing evidence, that B.C.
engaged in one or more of the acts or omissions necessary to support termination of her parental
rights under subsection (O) of Texas Family Code Section 161.001(b)(1). The trial court also
found that termination of the parent-child relationship between the children and B.C. is in the
children’s best interest. Based on these findings, the trial court ordered that the parent-child
relationship between B.C. and N.B. and P.B be terminated. This appeal followed.
1
M.B. is not a party to this appeal.
1
TERMINATION OF PARENTAL RIGHTS
Involuntary termination of parental rights embodies fundamental constitutional rights.
Vela v. Marywood, 17 S.W.3d 750, 759 (Tex. App.–Austin 2000), pet. denied per curiam, 53
S.W.3d 684 (Tex. 2001); In re J.J., 911 S.W.2d 437, 439 (Tex. App.—Texarkana 1995, writ
denied). Because a termination action “permanently sunders” the bonds between a parent and
child, the proceedings must be strictly scrutinized. Wiley v. Spratlan, 543 S.W.2d 349, 352 (Tex.
1976); In re Shaw, 966 S.W.2d 174, 179 (Tex. App.—El Paso 1998, no pet.).
Section 161.001 of the Family Code permits a court to order termination of parental
rights if two elements are established. TEX. FAM. CODE ANN. § 161.001 (West 2022); In re
J.M.T., 39 S.W.3d 234, 237 (Tex. App.—Waco 1999, no pet.). First, the parent must have
engaged in any one of the acts or omissions itemized in the second subsection of the statute. TEX.
FAM. CODE ANN. § 161.001(b)(1); Green v. Tex. Dep’t of Protective & Regulatory Servs., 25
S.W.3d 213, 219 (Tex. App.—El Paso 2000, no pet.); In re J.M.T., 39 S.W.3d at 237. Second,
termination must be in the best interest of the child. TEX. FAM. CODE ANN. § 161.001(b)(2); In re
J.M.T., 39 S.W.3d at 237. Both elements must be established by clear and convincing evidence,
and proof of one element does not alleviate the petitioner’s burden of proving the other. TEX.
FAM. CODE ANN. § 161.001; Wiley, 543 S.W.2d at 351; In re J.M.T., 39 S.W.3d at 237.
The clear and convincing standard for termination of parental rights is both
constitutionally and statutorily mandated. TEX. FAM. CODE ANN. § 161.001; In re J.J., 911
S.W.2d at 439. Clear and convincing evidence means “the measure or degree of proof that will
produce in the mind of the trier of fact a firm belief or conviction as to the truth of the allegations
sought to be established.” TEX. FAM. CODE ANN. § 101.007 (West 2019). The burden of proof is
upon the party seeking the deprivation of parental rights. In re J.M.T., 39 S.W.3d at 240.
STANDARD OF REVIEW
When confronted with both a legal and factual sufficiency challenge, an appellate court
must first review the legal sufficiency of the evidence. Glover v. Tex. Gen. Indem. Co., 619
S.W.2d 400, 401 (Tex. 1981); In re M.D.S., 1 S.W.3d 190, 197 (Tex. App.—Amarillo 1999, no
pet.). In conducting a legal sufficiency review, we must look at all the evidence in the light most
favorable to the finding to determine whether a reasonable trier of fact could have formed a firm
belief or conviction that its findings were true. In re J.F.C., 96 S.W.3d 256, 266 (Tex. 2002).
2
We must assume that the fact finder settled disputed facts in favor of its finding if a reasonable
fact finder could do so and disregard all evidence that a reasonable fact finder could have
disbelieved or found incredible. Id.
The appropriate standard for reviewing a factual sufficiency challenge to the termination
findings is whether the evidence is such that a fact finder could reasonably form a firm belief or
conviction about the truth of the petitioner’s allegations. In re C.H., 89 S.W.3d 17, 25 (Tex.
2002). In determining whether the fact finder has met this standard, an appellate court considers
all the evidence in the record, both that in support of and contrary to the trial court’s findings. Id.
at 27-29. Further, an appellate court should consider whether disputed evidence is such that a
reasonable fact finder could not have reconciled that disputed evidence in favor of its finding. In
re J.F.C., 96 S.W.3d at 266. The trier of fact is the exclusive judge of the credibility of the
witnesses and the weight to be given their testimony. Nordstrom v. Nordstrom, 965 S.W.2d 575,
580 (Tex. App.—Houston [1st Dist.] 1997, pet. denied).
TERMINATION UNDER SECTION 161.001(B)(1)(O)
In her first issue, B.C. contends the evidence is legally and factually insufficient to
terminate her parental rights pursuant to subsection (O) of Texas Family Code Section
161.001(b)(1).
Applicable Law
Subsection (O) provides that the court may order termination of the parent-child
relationship if the court finds by clear and convincing evidence that the parent has
failed to comply with the provisions of a court order that specifically established the actions
necessary for the parent to obtain the return of the child who has been in the permanent or
temporary managing conservatorship of the Department of Family and Protective Services for not
less than nine months as a result of the child’s removal from the parent under [Family Code]
Chapter 262 for the abuse or neglect of the child.
TEX. FAM. CODE ANN. § 161.001(b)(1)(O). Thus, pursuant to subsection (O), the Department
must prove that (1) it has been the child’s temporary or permanent managing conservator for at
least nine months; (2) it took custody of the child as a result of a removal from the parent under
Chapter 262 for abuse or neglect; (3) a court issued an order establishing the actions necessary
3
for the parent to obtain the return of the child; and (4) the parent did not comply with the court
order. See id.
Texas courts generally take a strict approach to subsection (O)’s application. In re D.N.,
405 S.W.3d 863, 877 (Tex. App.—Amarillo 2013, no pet.). A parent’s failure to complete one
requirement of her family service plan supports termination under that subsection. In re J.M.T.,
519 S.W.3d 258, 267 (Tex. App.—Houston [1st Dist.] 2017, pet. denied).
Analysis
On appeal, B.C. does not dispute that (1) the Department has been the children’s
temporary managing conservator for at least nine months; (2) the Department took custody of the
children as a result of a removal from the parent under Chapter 262 for abuse or neglect; and (3)
the court-ordered family service plan constituted an order of the trial court establishing the
actions necessary for her to be reunited with the children. Nor does B.C. dispute that the
evidence showed that she failed to comply with all the terms of the court-ordered family service
plan. However, she contends that she substantially complied with the plan and that her failure to
comply was outside of her control.
The Family Code provides an affirmative defense for parents who fail to comply with
provisions of a court order. TEX. FAM. CODE ANN. § 161.001(d). That section states that the trial
court may not order termination under subsection (O) based on the failure of a parent to comply
with a specific provision of the order if the parent proves by a preponderance of the evidence that
she was unable to comply with specific provisions and made a good faith effort and the failure to
comply is not attributable to the fault of the parent. Id. B.C. did not plead or invoke this
affirmative defense in the trial court and does not cite to this subsection on appeal. The failure to
plead an affirmative defense results in waiver. TEX. R. CIV. P. 94. As a result, B.C. waived this
affirmative defense.
B.C. concedes that she failed to comply with the terms of her service plan. In her brief,
B.C. states that she “substantially complied with the family services plan imposed upon her by
the trial court. She technically violated some limited provisions of that order. However, those
violations were substantially because of impossibility.” As part of her service plan, B.C. was
ordered to complete the HEART program “to address the trauma of past abusive relationships
and how these relationships can affect their current situation.” The evidence at trial showed that
B.C. failed to complete the HEART program. B.C. testified that she initially could not enroll
4
because the program did not have a facility due to COVID and they did not offer remote classes.
However, she failed to enroll when the facility did open in December 2021. B.C. admitted that
she failed to complete the program. A parent’s failure to complete one requirement of her family
service plan supports termination under that subsection. In re J.M.T., 519 S.W.3d at 267.
Applying the applicable standards of review, we hold that the evidence is legally and
factually sufficient to support the trial court’s predicate finding under subsection (O). See TEX.
FAM. CODE ANN. § 161.001(b)(1)(O).
BEST INTERESTS OF THE CHILDREN
In B.C’s second issue, she argues the evidence is legally and factually insufficient to
support a finding that termination of her parental rights is in the children’s best interest. In
determining the best interest of the child, a number of factors have been considered, including
(1) the desires of the child; (2) the emotional and physical needs of the child now and in the
future; (3) the emotional and physical danger to the child now and in the future; (4) the parental
abilities of the individuals seeking custody; (5) the programs available to assist these individuals;
(6) the plans for the child by these individuals; (7) the stability of the home; (8) the acts or
omissions of the parent that may indicate the existing parent-child relationship is not a proper
one; and (9) any excuse for the acts or omissions of the parent. Holley v. Adams, 544 S.W.2d
367, 371-72 (Tex. 1976).
The family code also provides a list of factors that we will consider in conjunction with
the above-mentioned Holley factors. See TEX. FAM. CODE ANN. § 263.307(b) (West 2022).
These include (1) the child’s age and physical and mental vulnerabilities; (2) the magnitude,
frequency, and circumstances of the harm to the child; (3) the results of psychiatric,
psychological, or developmental evaluations of the child, the child’s parents, other family
members, or others who have access to the child’s home; (4) whether there is a history of
substance abuse by the child’s family or others who have access to the child’s home; (5) the
willingness and ability of the child’s family to seek out, accept, and complete counseling services
and to cooperate with and facilitate an appropriate agency’s close supervision; (6) the
willingness and ability of the child’s family to effect positive environmental and personal
changes within a reasonable period of time; (7) whether the child’s family demonstrates adequate
parenting skills; and (8) whether an adequate social support system consisting of an extended
5
family and friends is available to the child. See id. § 263.307(b)(1), (3), (6), (8), (10), (11), (12),
(13).
The evidence need not prove all statutory or Holley factors in order to show that
termination of parental rights is in a child’s best interest. See Holley, 544 S.W.2d at 372; In re
J.I.T.P., 99 S.W.3d 841, 848 (Tex. App.–Houston [14th Dist.] 2003, no pet.). In other words, the
best interest of the child does not require proof of any unique set of factors nor limit proof to any
specific factors. In re D.M., 58 S.W.3d 801, 814 (Tex. App.—Fort Worth 2001, no pet.).
Undisputed evidence of just one factor may be sufficient in a particular case to support a finding
that termination is in the child’s best interest. In re M.R.J.M., 280 S.W.3d 494, 507 (Tex.
App.—Fort Worth 2009, no pet.). But the presence of scant evidence relevant to each factor will
not support such a finding. Id. Evidence supporting termination of parental rights is also
probative in determining whether termination is in the best interest of the child. See In re C.H.,
89 S.W.3d at 28-29. We apply the statutory and Holley factors below.
Analysis
The evidence at trial showed that N.B. and P.B. were eight and six years old,
respectively, at the time of trial. The children had been in the Department’s custody for eighteen
months. The record indicated two gaps in which B.C. failed to visit the children: the three
months the children resided in Louisiana and a three-month period in which B.C. refused to
submit to a drug test. The guardian ad litem, Joni Lunsford, testified that N.B.’s behavior
stabilized during the periods of no visitation. However, the missed visits caused N.B. “a lot of
distress” because he was worried that B.C. was involved in an accident or had taken her own life.
According to Lunsford, she told B.C. that N.B. gets upset by the missed visits, but B.C. still
continued to miss visits. B.C. admitted she missed three visits during the case and that N.B.
worried something had happened to her when she missed.
According to Lunsford, N.B. told her approximately one week before trial that B.C. said
her boyfriend, W.T., moved back to the home. The children seemed worried about W.T.’s
presence and P.B. focused on W.T. “needing to be nice.” The children previously mentioned
seeing broken glass, walls punched, and things thrown from the bedroom. B.C. denied telling
the children W.T. moved back. She claimed P.B. had a close bond with W.T.
The children have lived in the same foster home since August 2021. It is uncertain
whether the family would be willing to adopt the children; however, they are willing to keep the
6
children until a permanent home can be found. While in the foster home, N.B. lost weight by
eating healthier and had his teeth repaired. According to Nicole Petty, a Department caseworker,
the children are “thriving” in the home, doing well academically, and N.B. is a “healthier version
of himself.”
According to B.C., the children want to be with her. Lunsford testified that P.B. “wants
to live in a clean home. She’s maintained that for a long time.” She further testified that N.B.
wants to live with B.C. “He loves her. He very much wants to take care of her. And he thinks
that’s his job.” Lunsford stated she does not believe N.B.’s position is emotionally healthy for
an eight-year-old.
B.C. admitted that her relationship with the children’s father, M.B., was characterized by
domestic violence. She stated that M.B. kept the children away from September through
November 2020, just prior to the Department’s involvement. B.C. confirmed M.B. has a history
of methamphetamine abuse and a criminal history; however, she admitted to never filing any
legal documents to prohibit his access to the children.
Jessica Harris, a Department investigator, testified that she investigated allegations of
drug use, domestic violence, and unsuitable home conditions in February 2021. During the
investigation, B.C. admitted that she and W.T. used methamphetamine in the home while the
children were present. However, at trial, B.C. testified that she had not used methamphetamine
in the two months prior to the children being removed and claimed she never used drugs while
they were present. Harris further testified that B.C. initially stated she would take a drug test but
later refused. When Harris spoke with W.T., he became “very argumentative.” Harris also
confirmed that it was reported that the domestic abuse occurred in front of the children. Harris
described the home as “cluttered” but not hazardous. After a failed safety plan, the children were
removed from the home.
As noted above, B.C. failed to comply with the provisions of her service plan. B.C.
stated that she relapsed and used methamphetamine during the first five months of the case. She
claimed to be drug-free afterwards. However, she failed to participate in random drug testing
throughout the case. B.C. blamed poor phone reception for her failure to communicate with the
Department caseworkers. She also claimed to have lived in other places for more than half of the
case. In addition, she declined to allow a single home visit during the pendency of the case.
Lunsford went outside B.C.’s home and observed the conditions as unsafe, stating that “[t]here
7
was lots of wood and just discarded items all over the yard. So I don’t believe that she can
provide them a safe home.” Furthermore, B.C. failed to complete the domestic violence classes
through the HEART program.
B.C. testified that it was not in the children’s best interest for her rights to be terminated.
She stated that she lives in the same home that she did when the children were removed;
however, she claimed W.T. no longer lives there. B.C. testified that she does not pay rent and
has no written lease, but that W.T.’s mother owns the home and would allow her stay if she
continued working for her. She further testified that if the children were returned to her, she
would seek out counseling. She explained that she has learned that the children need stable
people around them.
Petty testified that she was concerned about the children returning to B.C.’s care.
According to Petty, B.C. is “not acknowledging or taking responsibility for her action or inaction
that led the children into [the Department’s] care.” Specifically, Petty testified as follows:
. . . When I stopped the case in May, at that time [B.C.] did not have stable housing. She didn’t
have stable income. She didn’t have stable transportation. I was unable to go see anywhere that
she was staying. She stated that she was, you know, basically spending the night on friends’
couches. That’s not permanency. That’s not stability. Children need stability. They need a home
and food and those things. And at that time it was unclear if she would be capable of providing
those things.
Q. In what you’ve observed from [B.C.], in your professional opinion, do you think she has the
skills to take care of the emotional needs for the children?
A. I do not.
Lashundra Ellis took over the case and testified that she made several attempts to contact B.C.
But B.C. cancelled a home visit. Ellis attempted to reschedule, planning to drug test her when
they met, but she was unable to contact B.C. Lunsford opined it was not in the children’s best
interest to return to B.C. because the home was unsafe and B.C. could not meet the children’s
needs.
After viewing the evidence in the light most favorable to the trial court’s best interest
finding and applying the statutory and Holley factors, we conclude that a reasonable trier of fact
could have formed a firm belief or conviction that termination of B.C.’s parental rights was in
the best interest of the children. See TEX. FAM. CODE ANN. § 161.001(b)(2); In re J.F.C., 96
S.W.3d at 266. Accordingly, we overrule B.C.’s second issue regarding best interest.
8
DISPOSITION
Having overruled B.C.’s first and second issues, we affirm the judgment of the trial
court.
JAMES T. WORTHEN
Chief Justice
Opinion delivered November 9, 2022.
Panel consisted of Worthen, C.J., Hoyle, J., and Neeley, J.
9
COURT OF APPEALS
TWELFTH COURT OF APPEALS DISTRICT OF TEXAS
JUDGMENT
NOVEMBER 9, 2022
NO. 12-22-00236-CV
IN THE INTEREST OF N.B. & P.B., CHILDREN
Appeal from the 294th District Court
of Van Zandt County, Texas (Tr.Ct.No. FM21-00059)
THIS CAUSE came to be heard on the appellate record and briefs filed
herein, and the same being considered, it is the opinion of this court that there was no error in the
judgment.
It is therefore ORDERED, ADJUDGED and DECREED that the judgment of
the court below be in all things affirmed, and that this decision be certified to the court below
for observance.
James T. Worthen, Chief Justice.
Panel consisted of Worthen, C.J., Hoyle, J., and Neeley, J.
10 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483532/ | [Cite as State v. Caldwell, 2022-Ohio-4035.]
IN THE COURT OF APPEALS
TWELFTH APPELLATE DISTRICT OF OHIO
BUTLER COUNTY
STATE OF OHIO, :
Appellee, : CASE NO. CA2022-04-032
: OPINION
- vs - 11/14/2022
:
TYLER RAY CALDWELL, :
Appellant. :
CRIMINAL APPEAL FROM BUTLER COUNTY COURT OF COMMON PLEAS
Case No. CR2019-01-0108
Michael T. Gmoser, Butler County Prosecuting Attorney, and Stephen M. Wagner, Assistant
Prosecuting Attorney, for appellee.
The Law Office of Wendy R. Calaway, Co., LPA, and Wendy R. Calaway, for appellant.
PIPER, J.
{¶1} Appellant, Tyler Caldwell, appeals a decision of the Butler County Court of
Common Pleas revoking his community control and sentencing him to prison.
{¶2} On June 11, 2019, Caldwell pled guilty to unlawful sexual conduct with a minor
(Count 1), illegal use of a minor in a nudity-oriented material or performance (Count 2), and
pandering sexually oriented matter involving a minor (Count 3). Caldwell was sentenced to
community control for a period of five years and classified as a Tier II Sex Offender. The
trial court advised Caldwell that a violation of community control could result in the
Butler CA2022-04-032
imposition of a prison term of 12 months for Count 1, 12 months for Count 2, and 18 months
for Count 3. Caldwell's terms of community control provided:
1. I will obey federal, state and local laws and ordinances,
including all orders, rules and regulations of Butler County
Common Pleas Court or the Department of Rehabilitation and
Correction. I agree to conduct myself as a responsible law
abiding citizen.
3. I will not leave the State of Ohio without written permission of
the Butler County Court of Common Pleas.
16. I will not purchase, use, possess or have under my control,
any electronic device, including but not limited to desktop
computers, laptop computers, blackberry devices, or cellular
telephones capable of accessing the Internet.
{¶3} Caldwell subsequently requested and received a modification of the terms of
his community control to allow for limited use of electronic devices capable of accessing the
internet for business purposes only. However, to do so, Caldwell was required to install
"Covenant Eyes" software on his devices. Covenant Eyes is software utilized by the Butler
County Probation Department to monitor the usage of electronic devices by individuals on
community control. Caldwell never proceeded to download or install the Covenant Eyes
software on his electronic devices.
{¶4} On September 9, 2021, the Butler County Chief Probation Officer filed a report
and notice of community control violations. The notice of violations stated that Caldwell
responded to an advertisement of the website "Listcrawler" to solicit sex and that he was
arrested in Boone County, Kentucky for solicitation of prostitution. The notice also stated
that Caldwell did not request permission or inform his probation officer about leaving the
state.
{¶5} The trial court held a community control violation hearing on March 7, 2022.
After consideration of the evidence at the hearing, the trial court found Caldwell violated
Conditions 1, 3, and 16 listed above. As such, the trial court revoked Caldwell's community
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Butler CA2022-04-032
control. The trial court sentenced Caldwell to concurrent prison terms of 18 months on
Count 1, 12 months on Count 2, and 18 months on Count 3, which deviated slightly from
the initial pronouncement when the court imposed community control. Caldwell timely
appeals the trial court's decision, raising three assignments of error for review.
{¶6} Assignment of Error No. 1:
{¶7} THERE WAS INSUFFICIENT EVIDENCE TO REVOKE PROBATION.
{¶8} Caldwell's first assignment of error alleges there was insufficient evidence to
revoke his probation.
{¶9} "A community control revocation hearing is not a criminal trial, so the state is
not required to establish a violation of the terms of the community control 'beyond a
reasonable doubt." State v. Motz, 12th Dist. Warren No. CA2019-10-109, 2020-Ohio-4356,
¶ 26. Rather, the state need only present substantial evidence of a violation of the
defendant's community control. Id.; State v. Pickett, 12th Dist. Warren No. CA2014-09-115,
2015-Ohio-972, ¶ 13.
{¶10} A trial court's decision revoking community control will not be disturbed on
appeal absent an abuse of discretion. State v. Smith, 12th Dist. Warren No. CA2019-09-
014, 2020-Ohio-3235, ¶ 7. An abuse of discretion occurs when the trial court's attitude is
unreasonable, arbitrary, or unconscionable. Id.
{¶11} Having reviewed the record, we find that the trial court did not abuse its
discretion in revoking Caldwell's community control as the state presented substantial
evidence that Caldwell failed to comply with, at a minimum, Conditions 3 and 16 of the terms
of his community control. Specifically, the state presented evidence that Caldwell was
aware he was not permitted to leave the State of Ohio without written permission and was
not permitted to possess an electronic device capable of accessing the internet without
having installed the Covenant Eyes software on such device.
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Butler CA2022-04-032
{¶12} The state presented evidence that Caldwell arranged to have anal sex at the
Comfort Suites in Kentucky for $150. Deputy Ryan King testified that Caldwell accessed
and responded to an online advertisement placed on Listcrawler. At the revocation hearing,
the state introduced evidence of the exchange between Caldwell and the crime suppression
unit in charge of the prostitution investigation. Deputy King testified that Caldwell arrived at
room 111 of the Comfort Suites where deputies detained him. Although Caldwell claims
that Condition 3 was modified so that he could travel to Kentucky so long as he notified his
probation officer within 24 hours, and thereby was compliant with the Condition when he
informed his probation officer of his arrest, we see no evidence that Condition 3 was ever
modified.1 As noted above, Caldwell was required to obtain "written permission" from the
Butler County Court of Common Pleas before entering Kentucky. Caldwell did not do so
prior to entering Kentucky.
{¶13} In addition, the state presented evidence that Caldwell was in possession of
an electronic device capable of accessing the internet. Deputy King testified that his crime
suppression unit placed the online advertisement on Listcrawler, to which Caldwell
responded. Although Caldwell received a modification that he could use electronic devices
for business purposes if he downloaded Covenant Eyes, the record reflects that Caldwell
never downloaded or installed that program on any device. Furthermore, Caldwell
accessed and responded to an online advertisement for the solicitation of sex, not a valid
business purpose. Based upon review of the entire record, we find there was sufficient
evidence to support the revocation of community control for the violation of Condition 3 and
Condition 16.2 Caldwell's first assignment of error is without merit.
1. Caldwell claimed that he called his probation officer shortly after he was arrested in Kentucky.
2. Caldwell also argues the trial court erred by revoking his community control because he was only arrested
and maintains that his conduct, in attempting to solicit prostitution, is not a violation of Kentucky law. Despite
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Butler CA2022-04-032
{¶14} Assignment of Error No. 2:
{¶15} THE BASIC DUE PROCESS REQUIREMENTS FOR A PROBATION
REVOCATION HEARING WERE NOT PROVIDED.
{¶16} In his second assignment of error, Caldwell argues he was deprived of due
process because the trial court failed to issue a written statement as to the evidence and
the reason for the revocation of community control. He further argues there was a
deficiency in the written notice of claimed violations giving rise to his arrest in Kentucky.
{¶17} "The due-process requirements for a revocation hearing include providing a
defendant with a written statement by the fact finder as to the evidence relied upon and the
reasons for revoking probation." State v. Klosterman, 2d Dist. Darke Nos. 2015-CA-9 and
2015-CA-10, 2016-Ohio-232, ¶ 15. The Ohio Supreme Court has held, however, that an
oral statement of the evidence and reasons for revoking community control also may satisfy
due process. State v. Delaney, 11 Ohio St.3d 231, 234-235 (1984); see also State v. Sears,
12th Dist. Butler No. CA2006-04-080, 2007-Ohio-1364, ¶ 8.
{¶18} We find Caldwell's argument to be unpersuasive. In the present case, the trial
court did not provide a written statement of the evidence but gave its reasons for revoking
community control at the conclusion of the hearing. The trial court stated on the record that
it had heard substantial evidence that Caldwell was in violation of community control. The
trial court indicated that it relied on Officer King's testimony and exhibits introduced with that
testimony to support the violations for leaving Ohio and possessing an electronic device
capable of accessing the internet. Caldwell was present through the proceedings,
represented by counsel, and permitted to cross-examine the witnesses and introduce
his arguments to the contrary, Caldwell's violations of Condition 3 and Condition 16 were enough for the trial
court to revoke community control. As this court has previously stated, "any violation of community control
conditions may properly be used to revoke the privilege [of remaining on community control]." State v.
Baldwin, 12th Dist. Clermont Nos. CA2015-10-082 and CA2015-10-086, 2016-Ohio-5476, ¶ 11
-5-
Butler CA2022-04-032
testimony from his own witnesses. While Caldwell argues differently, he was also provided
with adequate written notice of the violations of his community control. As addressed
above, there was substantial evidence to support revocation of community control in this
case. Based upon review of the record, we find no due process violation. Accordingly,
Caldwell's second assignment of error is overruled.
{¶19} Assignment of Error No. 3:
{¶20} THE SENTENCE WAS CONTRARY TO LAW.
{¶21} Caldwell argues in his third assignment of error that his sentence is contrary
to law. When an offender violates the conditions of his community control, "R.C. 2929.15(B)
provides the trial court [with] a great deal of latitude in sentencing the offender." Motz, 2020-
Ohio-4356 at ¶ 36. Pursuant to R.C. 2929.15(B), a trial court has the option of imposing "a
longer period of community control, a more restrictive community-control sanction, or a
prison term of any length within the range of that available for the original offense, up to the
maximum that the trial court specified at the first sentencing hearing." Id.
{¶22} In State v. Jones, 163 Ohio St.3d 242, 2020-Ohio-6729, the supreme court
held that R.C. 2953.08(G)(2) does not authorize an appellate court to review whether the
record supports a sentence under R.C. 2929.11 or R.C. 2929.12. Id. at ¶ 30. As a result,
this court does not independently weigh the evidence in the record to substitute the
judgment of the trial court. Id. at ¶ 42; State v. Orender, 12th Dist. Butler No. CA2021-12-
149, 2022-Ohio-2823, ¶ 15.
{¶23} We have held that a sentence is not clearly and convincingly contrary to law
where the trial court considers the purposes and principles of sentencing as set forth in R.C.
2929.11, as well as the seriousness and recidivism factors listed in R.C. 2929.12, and
sentences a defendant within the permissible statutory range. State v. Brandenburg, 12th
Dist. Butler Nos. CA2014-10-201 and CA2014-10-202, 2016-Ohio-4918, ¶ 9. The factors
-6-
Butler CA2022-04-032
set forth in R.C. 2929.12 are nonexclusive, and R.C. 2929.12 explicitly permits a trial court
to consider any relevant factors in imposing a sentence. State v. Stamper, 12th Dist. Butler
No. CA2012-08-166, 2013-Ohio-5669, ¶ 11.
{¶24} The trial court stated that it had considered the purposes and principles of
sentencing, as well as the seriousness and recidivism factors contained in R.C. 2929.11
and 2929.12. The trial court further found that Caldwell was not amenable to community
control. The trial court stated that Caldwell's lack of regard for the court's orders were
greatly disturbing and imposed a sentence of 18 months on Count 1, 12 months on Count
2, and 18 months on Count 3.
{¶25} While the trial court ordered these terms concurrent for a total prison time of
18 months, the state concedes that the trial court only reserved a prison sentence of 12
months on Count 1 during the initial sentencing hearing. Although there is no prejudice as
to the total prison term Caldwell will be serving, given this discrepancy, the trial court should
issue a nunc pro tunc entry to correct its mistake so that the sentencing entry accurately
reflects its pronouncements at the initial sentencing hearing. See State v. Goodwin, 12th
Dist. Butler, 2017-Ohio-2712, ¶ 45-46; State v. Fridley, 12th Dist. Clermont No. CA2016-
05-030, 2017-Ohio-4368, ¶ 52. Caldwell's remaining arguments are overruled.3
{¶26} Judgment affirmed in part, reversed in part, and remanded for the limited
purpose of issuing a nunc pro tunc sentencing entry.
M. POWELL, P.J., and HENDRICKSON, J., concur.
3. Caldwell also argued that the state had improper ex parte communications with the trial court in the drafting
of the sentencing entry violating his right to due process, citing State v. Roberts, 110 Ohio St.3d 71, 2006-
Ohio-3665, a death penalty case. While the record reflects that the state prepared the judgment entry, it does
not reflect that it was a product of ex parte communications between the prosecutor and the trial judge. State
v. R.W., 8th Dist. Cuyahoga No. 110858, 2022-Ohio-2771, ¶ 37-40; State v. Jordan, 8th Dist. Cuyahoga No.
109345, 2021-Ohio-701, ¶ 16-18; State v. Maxwell, 8th Dist. Cuyahoga No. 107758, 2020-Ohio-3027, ¶ 17;
State v. Davie, 11th Dist. Trumbull No. 2007-T-0069, 2007-Ohio-6940, ¶ 18-20.
-7- | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483551/ | J-S34024-22
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
COMMONWEALTH OF PENNSYLVANIA : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
RYSHAWN CRAWFORD :
:
Appellant : No. 445 WDA 2022
Appeal from the Judgment of Sentence Entered October 28, 2019
In the Court of Common Pleas of Indiana County
Criminal Division at CP-32-CR-0000282-2019
COMMONWEALTH OF PENNSYLVANIA : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
RYSHAWN CRAWFORD :
:
Appellant : No. 448 WDA 2022
Appeal from the PCRA Order Entered October 28, 2019
In the Court of Common Pleas of Indiana County
Criminal Division at CP-32-CR-0000280-2019
BEFORE: DUBOW, J., MURRAY, J., and PELLEGRINI, J.*
MEMORANDUM BY MURRAY, J.: FILED: NOVEMBER 14, 2022
Ryshawn Crawford (Appellant) appeals nunc pro tunc from the judgment
of sentence entered following his jury conviction of aggravated assault by
____________________________________________
* Retired Senior Judge assigned to the Superior Court.
J-S34024-22
prisoner at Indiana County Docket Number 280 CRIM 2019 (No. 280).1
Appellant also appeals nunc pro tunc from the judgment of sentence imposed
after he pled guilty to aggravated assault by prisoner at Docket Number 282
CRIM 2019 (No. 282).2 After careful review, quash both appeals.
The trial court explained:
[Appellant’s] conviction at [No. 280] arises from an incident that
occurred on or about March 4, 2019, when he was incarcerated at
SCI Pine Grove. According to the Affidavit of Probable Cause,
when Corrections Officer Marc Mandichak [(Officer Mandichak)]
collected [Appellant’s] food tray, [Appellant] shoved the tray and
threw a cup of urine on him….
….
[Appellant’s] conviction at [No. 282] arises from an incident on or
about February 8, 2019, while he was incarcerated at SCI Pine
Grove. According to the Affidavit of Probable Cause, [Appellant]
allegedly spat on Corrections Officer Ronald Snyder [(Officer
Snyder)]….
Trial Court Opinion, 12/15/20, at 1-2, 5.
At No. 280, trial was held on August 5, 2019, and a jury convicted
Appellant of aggravated harassment by prisoner as a third-degree felony. On
August 9, 2019, Appellant pled guilty to aggravated assault by prisoner at No.
282. On October 28, 2019, the trial court sentenced Appellant at both docket
____________________________________________
1 See 18 Pa.C.S.A. § 2703.1.
2 See 18 Pa.C.S.A. § 2703.1. At both docket numbers, the Post Conviction
Relief Act (PCRA) court, see 42 Pa.C.S.A. §§ 9541-9546, reinstated
Appellant’s direct appeal rights, nunc pro tunc. We consolidated the appeals
for review. Order, 5/10/22.
-2-
J-S34024-22
numbers. At No. 280, the trial court sentenced Appellant to 27 months - 5
years in prison. For Appellant’s guilty plea at No. 282, the trial court
sentenced Appellant to 21 months - five years in prison, to be served
consecutive to his sentence at No. 280, and consecutive to a previous
Delaware County sentence for robbery.
Appellant did not file timely post-sentence motions. On November 25,
2019, Appellant filed motions for leave to file nunc pro tunc post-sentence
motions at both docket numbers. The trial court granted Appellant’s motions,
and directed Appellant to file post-sentence motions within 30 days. Trial
Court Order, 11/26/19. On December 30, 2019, Appellant filed post-sentence
motions. After several continuances, the trial court conducted a hearing on
Appellant’s post-sentence motions on August 17, 2020. On December 15,
2020, the trial court denied the motions, and Appellant filed notices of appeal.
Trial Court Opinion and Order, 12/15/20. On April 28, 2021, this Court
quashed the appeals because Appellant failed to file timely post-
sentence motions at each docket number. Commonwealth v.
Crawford, Nos. 106 & 107 WDA 2021 (Pa. Super. filed April 28, 2021)
(orders).
On May 3, 2021, Appellant filed motions to reinstate his right to file
post-sentence motions at each docket number. The trial court denied the
motions on August 26, 2021. Trial Court Order (Nos. 280 & 282), 8/26/21.
-3-
J-S34024-22
On October 8, 2021, Appellant filed PCRA petitions at both docket
numbers. The PCRA court appointed counsel, who filed amended petitions on
Appellant’s behalf. Amended PCRA Petitions, 10/28/21. After an evidentiary
hearing, the PCRA court reinstated Appellant’s direct appeal rights, nunc pro
tunc. PCRA Court Orders (Nos. 280 & 282), 4/7/22. Appellant filed separate
notices of appeal at each docket number. Appellant and the trial court have
complied with Pa.R.A.P. 1925.
Before addressing Appellant’s issues, we consider our jurisdiction over
these nunc pro tunc direct appeals. Appellant did not timely file post-sentence
motions to his October 28, 2019, judgment of sentence. See
Commonwealth v. Crawford, Nos. 106 & 107 WDA 2021 (Pa. Super. filed
April 28, 2021) (orders) (concluding Appellant’s post-sentence motions and
subsequent appeals were untimely filed and quashing his direct appeals). As
a result, Appellant’s judgment of sentence became final on November 27,
2019, 30 days after his October 28, 2019, judgment of sentence. See
Pa.R.Crim.P. 720(A)(3) (“If the defendant does not file a timely post-
sentence motion, the defendant’s notice of appeal shall be filed within 30
days of imposition of sentence”).
A PCRA petition, including a second or subsequent petition, must be filed
within one year of the date that the petitioner’s judgment becomes
final. See 42 Pa.C.S.A. § 9545(b)(1). “The timeliness requirements of the
PCRA are jurisdictional in nature, and courts cannot address the merits of an
-4-
J-S34024-22
untimely petition.” Commonwealth v. Moore, 247 A.3d 990, 998 (Pa.
2021).
Because Appellant’s judgment of sentence became final on November
27, 2019, he was required to file his PCRA petition on or before November 27,
2020. See id. As November 27, 2020, fell on a court holiday, Appellant had
to file his petition by Monday, November 30, 2020. See 1 Pa.C.S.A. § 1908
(“Whenever the last day of any such period shall fall on … any day made a
legal holiday by the laws of this Commonwealth or of the United States, such
day shall be omitted from the computation.”).
Appellant’s PCRA petition, filed October 8, 2021, was untimely. A
petitioner may establish an exception to the timeliness requirement by
pleading and proving (i) interference by government officials; (ii) newly
discovered facts; or (iii) a newly recognized constitutional right. See 42
Pa.C.S.A. § 9545(b)(1)(i)-(iii). However, the Appellant did not plead or prove
an exception. The PCRA court thus lacked jurisdiction to reinstate Appellant’s
direct appeal rights, nunc pro tunc, and this Court lacks jurisdiction over
Appellant’s nunc pro tunc appeal. See Moore, 247 A.3d at 998.
Consequently, we are constrained to quash the consolidated appeals.
Appeals quashed.
-5-
J-S34024-22
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 11/14/2022
-6- | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483550/ | J-S29008-22
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
COMMONWEALTH OF PENNSYLVANIA : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
EVAN DAVIS :
:
Appellant : No. 1028 WDA 2021
Appeal from the Judgment of Sentence Entered July 28, 2021
In the Court of Common Pleas of Allegheny County
Criminal Division at No(s): CP-02-CR-0012350-2019
BEFORE: PANELLA, P.J., MURRAY, J., and COLINS, J.*
MEMORANDUM BY PANELLA, P.J.: FILED: November 14, 2022
In this case we are called upon to review the circumstances that led to
the search of an automobile in which Evan Davis was a passenger, and which
led to his multiple criminal convictions. After careful review, we affirm the
judgment of sentence.
At approximately 4:00 PM on September 5, 2019, a confidential
informant (“the CI”) and an agent from the Pennsylvania Attorney General’s
Office used the CI’s cell phone to arrange a purchase of $200 of heroin from
a suspected drug dealer. The drug dealer instructed the CI to go to the Rolling
Woods apartment complex in North Versailles, Pennsylvania. At approximately
____________________________________________
* Retired Senior Judge assigned to the Superior Court.
J-S29008-22
4:27 PM, the suspected drug dealer phoned the CI and gave additional
instructions on where to park in the complex. The CI was to be in an
undercover vehicle that was described to the suspected drug dealer.1 As
directed by the suspected drug dealer, the undercover vehicle was parked in
a spot located in the designated area of the parking lot, with no other vehicles
nearby. At approximately 4:41 PM, a black Lincoln entered the parking lot and
proceeded directly to the undercover vehicle. After making minor
adjustments, the black Lincoln parked close enough to the undercover vehicle
so that the vehicles were within arm’s reach of each other.
Meanwhile, Officer Norman Locke, a member of the North Versailles
Township Police Department involved in the undercover investigation, was
parked in a marked cruiser in a location where he could clearly observe the
parking area. After the black Lincoln parked, the agents in the undercover
vehicle exited and Officer Locke activated his emergency lights and
approached the scene.
At the suppression hearing, Officer Locke testified that after he parked
and walked up to the black Lincoln, he detected the odor of marijuana coming
from the vehicle. The four occupants of the black Lincoln were removed from
the automobile. Officer Locke observed bundles of marijuana in the pocket on
the back of the driver’s seat. Davis was seated in the rear passenger seat, and
____________________________________________
1The CI was not in the undercover vehicle but was at an off-site location.
Rather, the undercover vehicle had law enforcement officers stationed inside.
-2-
J-S29008-22
when he exited the vehicle, police observed a firearm on the seat where he
was seated. Also, sixty bags of heroin were recovered from the pocket on the
back of the driver’s seat. Upon his arrest Davis was searched at the scene and
two bags of cocaine were recovered. During a search of Davis at the police
station, heroin was discovered.
On December 30, 2019, the Commonwealth filed a criminal information
charging Davis with one count each of Person Not to Possess a Firearm,
Receiving Stolen Property (“RSP”), Carrying a Firearm without a License,
Criminal Conspiracy, Possession with Intent to Deliver a Controlled Substance
(“PWID”), and two counts of Possession of a Controlled Substance.2 Davis filed
an omnibus pretrial motion seeking to suppress physical evidence. A
suppression hearing was held, and the trial court denied the motion on
November 12, 2020.
After a non-jury trial, Davis was found not guilty of RSP and guilty of
the remaining charges. On July 28, 2021, the trial court sentenced Davis to
serve an aggregate term of incarceration of four to eight years. Davis filed a
post-sentence motion, which the trial court denied. This timely appeal
followed. Both Davis and the trial court have complied with Pa.R.A.P. 1925.
In his sole issue, Davis argues the trial court erred in denying his motion
to suppress the evidence. See Appellant’s Brief at 8-11. Davis contends the
____________________________________________
218 Pa.C.S.A. §§ 6105(a)(1), 3925(a), 6106(a)(1), 903, 35 P.S. §§ 780-
113(a)(30), and 780-113(a)(16), respectively.
-3-
J-S29008-22
search of the black Lincoln was illegal because it was based solely upon Officer
Locke’s observation of the odor of marijuana. See id. at 10. To support his
claim that the evidence must be suppressed, Davis relies on our Supreme
Court’s recent decision in Commonwealth v. Barr, 266 A.3d 25 (Pa. 2021)
(holding that, following the enactment of the Medical Marijuana Act (“MMA”),
“the odor of marijuana alone does not amount to probable cause to conduct a
warrantless search of a vehicle but, rather, may be considered as a factor in
examining the totality of the circumstances.”). Upon review, we conclude the
facts of this case render Barr distinguishable.
Questions of the admission and exclusion of evidence are within the
sound discretion of the trial court and will not be reversed on appeal absent
an abuse of discretion. See Commonwealth v. Freidl, 834 A.2d 638, 641
(Pa. Super. 2003). Moreover, we note that our scope of review from a
suppression ruling is limited to the evidentiary record that was created at the
suppression hearing. See In re L.J., 79 A.3d 1073, 1087 (Pa. 2013). While
Pa.R.Crim.P. 581(H) provides that “[t]he Commonwealth shall have the
burden ... of establishing that the challenged evidence was not obtained in
violation of the defendant’s rights[,]” it is nonetheless true that “[i]t is within
the suppression court’s sole province as factfinder to pass on the credibility of
witnesses and the weight to be given their testimony.” Commonwealth v.
Gallagher, 896 A.2d 583, 585 (Pa. Super. 2006).
-4-
J-S29008-22
To secure the right of citizens to be free from intrusions by police, courts
in Pennsylvania have long required law enforcement officers to demonstrate
ascending levels of suspicion to justify their interactions with citizens as those
interactions become more intrusive. See Commonwealth v. Beasley, 761
A.2d 621, 624 (Pa. Super. 2000).
It is undisputed that:
Pennsylvania case law recognizes three categories of
interaction between police officers and citizens. The first of these
is a “mere encounter,” or request for information, which need not
be supported by any level of suspicion, but which carries no official
compulsion to stop or to respond. The second category, an
“investigative detention,” must be supported by reasonable
suspicion. This interaction subjects a suspect to a stop and a
period of detention, but does not involve such coercive conditions
as to constitute the functional equivalent of an arrest. The third
category, an arrest or “custodial detention,” must be supported
by probable cause. Probable cause exists where the facts and
circumstances within the officer's knowledge are sufficient to
warrant a person of reasonable caution in the belief that an
offense has been or is being committed.
Commonwealth v. Acosta, 815 A.2d 1078, 1082 (Pa. Super. 2003) (en
banc) (citations and some quotation marks omitted).
Reasonable suspicion exists when there are specific and articulable facts
that create a reasonable suspicion, based on the officer’s experience, that
there is criminal activity afoot. See Commonwealth v. Sands, 887 A.2d 261,
271-272 (Pa. Super. 2005). Probable cause exists where the facts and
circumstances within the officer’s knowledge are sufficient to warrant a person
of reasonable caution to believe that a defendant has or is committing an
-5-
J-S29008-22
offense. See Commonwealth v. Runyan, 160 A.3d 831, 837 (Pa. Super.
2017) (citation omitted).
The well-established standard for evaluating whether probable cause
exists is consideration of the “totality of the circumstances” and not individual
factors. See Runyan, 160 A.3d at 837. Probable cause does not require
certainty, but rather exists when criminality is one reasonable inference, not
necessarily even the most likely inference. See Commonwealth v.
Lindblom, 854 A.2d 604, 607 (Pa. Super. 2004).
Recently, in Barr our Supreme Court held that following the enactment
of the MMA, “the odor of marijuana alone does not amount to probable cause
to conduct a warrantless search of a vehicle but, rather, may be considered
as a factor in examining the totality of the circumstances.” Barr, 266 A.3d at
44. In reaching its conclusion, the Court explained “the smell of marijuana
indisputably can still signal the possibility of criminal activity[,]” and it “may
be a factor, but not a stand-alone one, in evaluating the totality of the
circumstances for purposes of determining whether police had probable
cause….” Commonwealth v. Barr, 266 A.3d 25, 41 (Pa. 2021).
While “marijuana no longer is per se illegal in this Commonwealth”
following passage of the MMA, “possession of marijuana [is] illegal for those
not qualified under the MMA.” Barr, 266 A.3d at 41. We are also mindful that
pursuant to the MMA, unused medical marijuana is to be kept in its original
-6-
J-S29008-22
package, which is subject to labeling requirements. See 35 P.S. §
10231.303(b)(6), (8).
Here, the trial court addressed Davis’s claim challenging the admission
of evidence as follows:
Under these circumstances, the officers had reasonable suspicion
that criminal activity, by way of a drug deal, was underway. The
meeting at the parking lot was at the suggestion the drug dealer,
who was contacted by a reliable confidential informant. The black
Lincoln arrived at the designated time and place of the apartment
complex. There were no other vehicles parked in area of the
planned drug transaction. Officer Locke smelled a strong odor of
marijuana, but it was not that single fact, alone, that caused him
and other task force members to approach the suspected drug
dealer’s vehicle. Heroin was observed in plain view, and defendant
was found to be sitting on a firearm while he was being removed
from the vehicle. [Davis’s] reliance on Commonwealth v. Barr,
240 A.3d 1263 (Pa. Super. 2020) is misplaced under the
circumstances of this case as police were relying on much more
than merely the odor of marijuana to approach the suspects and
place them under arrest.
Trial Court Opinion, 4/20/22, at 4.
Our review of the certified record reveals the trial court’s reasoning is
well supported. The odor of marijuana was not the sole factor that led police
to search the vehicle. As the trial court noted, the police were aware that the
CI, who was a reliable informant, set up a drug purchase on the day of the
incident. See N.T., Suppression Hearing, 9/22/2020, at 6. The suspected drug
dealer directed the CI to a specified location to complete the drug deal. See
id. at 7. An undercover vehicle was described to the suspected drug dealer as
the vehicle that the CI would be in. See id. at 9. At the designated time and
location, undercover agents were waiting in the undercover car in an empty
-7-
J-S29008-22
portion of the parking lot as directed. See id. The vehicle in which Davis was
found, the black Lincoln, arrived at the scene at a time indicated by the
suspected drug dealer. See id. at 8.
Further, as explained by Officer Locke at the suppression hearing, the
black Lincoln parked next to the undercover vehicle in a manner indicative of
a drug transaction. See id. at 10-11. Upon approaching the black Lincoln,
Officer Locke testified that he noticed the odor of marijuana emanating from
the vehicle. See id. at 13-14. The entirety of the facts indicate that the odor
of marijuana was not the sole fact to support a finding of probable cause.
Rather, the totality of these circumstances, and the permissible inferences,
are sufficient to warrant a person of reasonable caution to believe that a crime
was being committed.
In addition, we observe Officer Locke stated that, while standing outside
of the black Lincoln prior to the search of the vehicle, he observed bags and
bundles of marijuana in a pocket on the back of the driver’s seat. See id. at
15. Again, unused medical marijuana is to be kept in its original package,
which is subject to labeling requirements. See 35 P.S. § 10231.303(b)(6),
(8). Based upon his training and experience, the illegal nature of the
marijuana packaged in bags and bundles in the rear pocket of the driver’s seat
was immediately apparent. Davis has not presented any contrary argument.
Accordingly, we conclude that this fact adds further support to the
-8-
J-S29008-22
determination that probable cause existed, and Davis’s contrary argument
lacks merit.
Therefore, it is our determination that the suppression court properly
denied Davis’s motion to suppress the evidence. Consequently, we affirm the
judgment of sentence.
Judgment of sentence affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 11/14/2022
-9- | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483553/ | J-S27030-22
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
COMMONWEALTH OF PENNSYLVANIA : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
SIMEON BOZIC :
:
Appellant : No. 972 EDA 2021
Appeal from the PCRA Order Entered April 6, 2021
In the Court of Common Pleas of Philadelphia County Criminal Division at
No(s): CP-51-CR-0107651-2005
BEFORE: STABILE, J., NICHOLS, J., and SULLIVAN, J.
MEMORANDUM BY NICHOLS, J.: FILED NOVEMBER 14, 2022
Appellant Simeon Bozic appeals pro se from the order dismissing his
second Post Conviction Relief Act1 (PCRA) petition as untimely. Appellant
argues that the PCRA court erred in dismissing his petition without a hearing.
We affirm.
The underlying facts and procedural history of this matter are well
known to the parties. See Commonwealth v. Bozic, 997 A.2d 1211, 1214-
15 (Pa. Super. 2010) (Bozic I). Briefly, Appellant was charged with first-
degree murder2 and related offenses for his role in beating and stabbing the
twenty-one-year-old girlfriend of his co-defendant. Id. Although Appellant
attempted to invoke a duress defense at trial, the jury ultimately convicted
____________________________________________
1 42 Pa.C.S. §§ 9541-9546.
2 18 Pa.C.S. § 2502(a).
J-S27030-22
him of all charges. Id. On March 13, 2008, Appellant was sentenced to life
imprisonment and a concurrent term of twenty to forty years of incarceration.
Appellant filed a post-sentence motion, which the trial court denied on July
16, 2008. Appellant filed a direct appeal on July 21, 2008. Notice of Appeal,
7/21/08. This Court affirmed Appellant’s judgment of sentence on June 24,
2010, and our Supreme Court denied allowance of appeal. Bozic I, appeal
denied, 13 A.3d 474 (Pa. 2010) (Bozic II). The United States Supreme Court
denied Appellant’s petition for writ of certiorari on May 31, 2011, and denied
rehearing on August 15, 2011. Bozic v. Pennsylvania, 563 U.S. 1025
(2011), rehearing denied, 564 U.S. 1060 (2011) (Bozic III).
On February 2, 2012, Appellant filed his first pro se PCRA petition.
Daniel Silverman, Esq. (Former PCRA Counsel) subsequently filed an amended
petition on Appellant’s behalf. Am. PCRA Pet., 1/4/13. Ultimately, the PCRA
court dismissed Appellant’s PCRA petition on March 17, 2015 and Appellant
filed an appeal. This Court affirmed the order dismissing Appellant’s PCRA
petition on August 29, 2016. Commonwealth v. Bozic, 952 EDA 2015, 2016
WL 5539985 (Pa. Super. filed Aug. 29, 2016) (Bozic IV) (unpublished mem.),
appeal denied, 165 A.3d 874 (Pa. 2017) (Bozic V).
Appellant filed the instant PCRA petition on March 14, 2018, claiming
that he satisfied the newly discovered facts exception to the PCRA time bar.3
Pro Se PCRA Pet., 3/14/18, at 3. On February 5, 2021, the PCRA court issued
____________________________________________
3 42 Pa.C.S. § 9545(b)(1)(ii).
-2-
J-S27030-22
a Pa.R.Crim.P. 907 notice of intent to dismiss Appellant’s PCRA petition
without a hearing as untimely. PCRA Ct. Order, 2/5/21. Appellant did not file
a response. On April 6, 2021, the PCRA court dismissed Appellant’s petition.
PCRA Ct. Order, 4/6/21.
On April 26, 2021, Appellant filed a notice of appeal with this Court.
Notice of Appeal, 4/26/21. On August 4, 2021, the PCRA court issued an order
directing Appellant to file a Pa.R.A.P 1925(b) statement by August 25, 2021.
PCRA Ct. Order, 8/4/21. Appellant filed this statement on August 19, 2021.4
On appeal, Appellant raises the following issues for review, which we
have reordered as follows:
1. When [Appellant] filed his successive petition for post-
conviction relief within sixty days from the date he discovered
photographic evidence that should have been used to support
his duress defense, did the [PCRA court] violate 42 Pa.C.S. §
9545(b)(1)(ii)?
2. Did the [PCRA court] abuse its discretion by distorting the facts
and changing petitioner’s claim into an entirely different one
just to support a patently erroneous dismissal?
3. After [Appellant] discovered the photographic evidence, when
was his first available opportunity to allege post-conviction
counsel’s ineffectiveness on this issue?
4. Did trial counsel’s failure to present photographic evidence to
support [Appellant’s] duress defense, and does post-conviction
counsel’s failure to raise this claim, amount to ineffective
assistance?
Appellant’s Brief at 3.
____________________________________________
4 Although the PCRA court did not file a separate Rule 1925(a) opinion, it did
file an opinion with its April 6, 2021 order dismissing Appellant’s PCRA petition
as untimely explaining its reasons for dismissing the petition.
-3-
J-S27030-22
Timeliness
As noted previously, Appellant argues that he has met the newly-
discovered fact exception to the PCRA time bar. Specifically, he claims that
he discovered exculpatory evidence in the form of crime scene photographs,
which would have proven that “he could not escape the house on the night
[Appellant’s co-defendant] murdered his girlfriend.” Id. at 16. Appellant
asserts that he was unaware that the photos existed until he received them in
the mail from Former PCRA Counsel on January 19, 2018. Id. at 13. He also
contends that had no reason to believe that trial counsel would not share this
evidence with him, and that he filed his PCRA petition within sixty days of
when the claim could have been first presented. Id. at 14.
Our review of the denial of PCRA relief is limited to “whether the record
supports the PCRA court’s determination and whether the PCRA court’s
decision is free of legal error.” Commonwealth v. Lawson, 90 A.3d 1, 4
(Pa. Super. 2014) (citation omitted).
“[T]he timeliness of a PCRA petition is a jurisdictional requisite.”
Commonwealth v. Brown, 111 A.3d 171, 175 (Pa. Super. 2015) (citation
omitted). A PCRA petition, “including a second or subsequent petition, shall
be filed within one year of the date the judgment becomes final” unless the
petitioner pleads and proves one of three statutory exceptions. 42 Pa.C.S. §
9545(b)(1)(i)-(iii). A judgment of sentence becomes final for PCRA purposes
“at the conclusion of direct review, including discretionary review in the
-4-
J-S27030-22
Supreme Court of the United States and the Supreme Court of Pennsylvania,
or at the expiration of time for seeking the review.” 42 Pa.C.S. § 9545(b)(3).
If a petition is untimely, and none of the timeliness exceptions are met,
courts do not have jurisdiction to address the substance of the underlying
claims. Commonwealth v. Cox, 146 A.3d 221, 227 (Pa. 2016). Further, it
is the PCRA petitioner’s “burden to allege and prove that one of the timeliness
exceptions applies.” Commonwealth v. Albrecht, 994 A.2d 1091, 1094 (Pa.
2010) (citation omitted and some formatting altered); see also 42 Pa.C.S. §
9545(b)(1)(i)-(iii).5 Additionally, Section 9545(b)(2) requires that any
petition attempting to invoke one of these exceptions must be filed within one
year of the date the claim could have been presented. 42 Pa.C.S. §
9545(b)(2); see also Commonwealth v. Callahan, 101 A.3d 118, 122 (Pa.
Super. 2014) (explaining that the plain language of the PCRA statute shows
____________________________________________
5 The exceptions are as follows:
(i) the failure to raise the claim previously was the result of
interference by government officials with the presentation of the
claim in violation of the Constitution or laws of this Commonwealth
or the Constitution or laws of the United States;
(ii) the facts upon which the claim is predicated were unknown to
the petitioner and could not have been ascertained by the exercise
of due diligence; or
(iii) the right asserted is a constitutional right that was recognized
by the Supreme Court of the United States or the Supreme Court
of Pennsylvania after the time period provided in this section and
has been held by that court to apply retroactively.
42 Pa.C.S. § 9545(b)(i)-(iii).
-5-
J-S27030-22
that a judgment of sentence becomes final immediately upon expiration of the
time for seeking direct review).
Here, Appellant’s judgment of sentence became final on August 15,
2011, when the United States Supreme Court denied his petition for rehearing
after the denial of certiorari. See Bozic III, 564 U.S. at 1060. Accordingly,
Appellant was required to file a PCRA petition on or before August 15, 2012.
See 42 Pa.C.S. § 9545(b)(2). Therefore, Appellant’s instant PCRA petition,
filed on March 14, 2018, was facially untimely.
As stated, Appellant alleges that he satisfied the newly discovered facts
exception to the PCRA time bar. When asserting newly discovered facts, a
petitioner must plead and prove: (1) the facts were unknown to him or her,
and (2) the facts could not have been ascertained through due diligence.
Commonwealth v. Burton, 158 A.3d 618, 629 (Pa. 2017); see also 42
Pa.C.S. § 9545(b)(1)(ii).
The timeliness exception set forth in Section 9545(b)(1)(ii)
requires a petitioner to demonstrate he did not know the facts
upon which he based his petition and could not have learned those
facts earlier by the exercise of due diligence. Due diligence
demands that the petitioner take reasonable steps to protect his
own interests. A petitioner must explain why he could not have
learned the new fact(s) earlier with the exercise of due diligence.
This rule is strictly enforced. Additionally, the focus of this
exception is on the newly discovered facts, not on a newly
discovered or newly willing source for previously known facts.
Brown, 111 A.3d at 176 (citations and quotation marks omitted).
-6-
J-S27030-22
In response to Appellant’s claim, the Commonwealth notes that at trial,
Appellant specifically argued that he participated in the crime under duress.6
Commonwealth’s Brief at 11-12. The Commonwealth explains that the
prosecution introduced crime scene photos revealing that the doors were in
fact locked, and it quotes testimony from trial directly addressing this fact.
Id. at 12 (citing N.T. 11/13/07, at 122, 124). Therefore, the Commonwealth
contends that the new crime-scene photographs “simply provide new support
for the previously-known fact that [Appellant] allegedly could not escape from
the crime scene.” Id. at 11-12.
The PCRA court addressed this issue as follows:
In an attempt to establish the newly-discovered fact exception,
[42 Pa.C.S. § 9545(b)(1)(ii)], [Appellant] claimed he discovered
that he was unable to escape the victim’s house during the
commission of the crime. See [Pro Se PCRA Pet., 3/14/18, at 3].
In support of his claim, [Appellant] appended crime-scene
photographs he purportedly received from his attorney in 2018.
See id. at Exhibit 2. [Appellant] claimed that the photographs
establish that the back door of the victim’s residence was
barricaded and the front door did not have a door knob. See id.
at 3.
At the outset, because [Appellant] was present inside the victim’s
home during the murder, the fact that he was unable to escape,
if true, was not previously unknown. Therefore, the photographs
are merely a new source for a previously known fact, and
unavailing for purposes of subsection 9545(b)(1)(ii). See
Commonwealth v. Marshall, 947 A.2d 714, 720 (Pa. 2008)
(explaining a petitioner does not satisfy the “newly discovered
____________________________________________
6 The elements necessary to establish the duress defense are: immediate or
imminent threat of death or serious bodily injury; well-grounded or reasonable
fear that the threat will be carried out; and no reasonable opportunity to
escape threatened harm except by committing the criminal act.
Commonwealth v. Baskerville, 681 A.2d 195, 200 (Pa. Super. 1996).
-7-
J-S27030-22
facts” exception where he merely alleges a newly discovered
source for previously known facts).
PCRA Ct. Op., 4/6/21, at 1 (citation omitted).
Upon review, we agree with the PCRA court’s conclusion. The record
reflects that the issue of duress and Appellant’s alleged inability to escape
were specifically argued and addressed at trial. As noted by the PCRA court,
the new crime scene photos showing that the doors were locked are merely a
new source for a previously known fact. Therefore, on this record, we
conclude that Appellant has failed to establish the newly discovered fact
exception to the PCRA time bar. See Marshall, 947 A.2d at 720; Brown,
111 A.3d at 176.
Because Appellant’s petition is facially untimely and Appellant failed to
prove an exception, he has failed to meet the required jurisdictional threshold.
See Cox, 146 A.3d at 227; see also Brown, 111 A.3d at 175. For these
reasons, we conclude that the PCRA court correctly dismissed Appellant’s
second PCRA petition as untimely, and we affirm. See Lawson, 90 A.3d at
4.7
____________________________________________
7 In light of our conclusion that Appellant’s second PCRA was untimely and
that he failed to satisfy a jurisdictional threshold, Appellant’s motion for an
extension of time, Appellant’s application to expand the record, and the
Commonwealth’s motion for leave to file a sur reply are all DENIED as moot.
Additionally, we note that Assistant District Attorney Tanya Kapoor filed a
motion to withdraw as counsel for the Commonwealth on October 5, 2021.
Attorney Kapoor stated that Assistant District Attorney Lawrence J. Goode,
would remain as counsel for the Commonwealth. Accordingly, we GRANT
Attorney Kapoor’s motion to withdraw, and Assistant District Attorney
Lawrence J. Goode, Esq. is hereby substituted as counsel for the
Commonwealth.
-8-
J-S27030-22
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 11/14/2022
-9- | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483572/ | USCA11 Case: 21-12696 Date Filed: 11/14/2022 Page: 1 of 10
[DO NOT PUBLISH]
In the
United States Court of Appeals
For the Eleventh Circuit
____________________
No. 21-12696
Non-Argument Calendar
____________________
PATRICIA A. JOHNSON,
Plaintiff-Appellant,
versus
WALT DISNEY PARKS AND RESORTS U.S., INC.,
a Florida profit corporation,
Defendant-Appellee.
____________________
Appeal from the United States District Court
for the Middle District of Florida
USCA11 Case: 21-12696 Date Filed: 11/14/2022 Page: 2 of 10
2 Opinion of the Court 21-12696
D.C. Docket No. 6:19-cv-02139-GAP-EJK
____________________
Before WILSON, JILL PRYOR, and ANDERSON, Circuit Judges.
PER CURIAM:
Patricia A. Johnson appeals the district court’s grant of sum-
mary judgment to Walt Disney Parks and Resorts US, Inc. (“Dis-
ney”) on her claim of disability discrimination under the Americans
with Disabilities Act (“ADA”), 42 U.S.C. § 12112. 1 Johnson alleged
that Disney discriminated against her when it terminated her after
denying her requests for a reasonable workplace accommodation.
On appeal, Johnson challenges the district court’s summary
judgment ruling on two grounds. First, she argues that the court
erred in concluding that she failed to demonstrate she was disabled.
Second, she contends that the district court erred in concluding
that she was not a “qualified individual” under the ADA,
42 U.S.C. § 12111(8). After careful review, we affirm.
1 Johnson also brought a handicap discrimination claim under the Florida Civil
Rights Act of 1992 (“FCRA”), Florida Statutes §§ 760.07, 760.10(1)(a), 760.11.
Because handicap discrimination claims under the FCRA are analyzed using
the same framework as disability claims under the ADA, we need not sepa-
rately address the FCRA claim. See Greenberg v. BellSouth Telecomms., Inc.,
498 F.3d 1258, 1263–64 (11th Cir. 2007). It succeeds or fails for the same rea-
sons as the ADA claim.
USCA11 Case: 21-12696 Date Filed: 11/14/2022 Page: 3 of 10
21-12696 Opinion of the Court 3
I. BACKGROUND
In 2014, Johnson injured her neck in a car accident. Her in-
juries included bulging and herniated discs in her cervical verte-
brae. One year later, Johnson began working for one of Disney’s
retail stores as a part-time retail cast member. In this position, her
responsibilities included assisting guests, operating the register,
stocking merchandise, and sorting inventory. It is undisputed that
the position required standing for two to three hours per shift.
When Johnson was hired, the store location where she worked,
Disney Springs, was undergoing extensive construction and reno-
vation. As a result, the store’s parking lot was closed. Employees,
including Johnson, were expected to park in a parking lot located
on the other side of the Disney Springs property and walk about a
mile to the store. Employees with a disability placard, however,
were permitted to park in a parking lot closer to Johnson’s assigned
work location.
During her work shifts, Johnson suffered from pain and
numbness in her right leg. She attributed this pain to her previous
car accident, the walk from the parking lot, and having to stand as
she worked.
After working at this job for about a week, Johnson spoke
with her store manager to discuss her pain. The store manager di-
rected her to submit a “Physician’s Certification for Employee Ac-
commodations Form” to Disney. Johnson completed the form, at-
taching a form from a physician. It is undisputed that she had the
following restrictions: she needed (1) a 15-minute seated break after
USCA11 Case: 21-12696 Date Filed: 11/14/2022 Page: 4 of 10
4 Opinion of the Court 21-12696
standing for three hours and (2) a break after walking 100 yards. 2
Ultimately, Disney placed her on medical leave and assigned her a
case advocate. While Johnson was on leave, her case advocate re-
viewed 18 jobs to determine whether Johnson could be reassigned.
In addition to the 18 jobs, Johnson inquired about a personalization
artist position; however, the position was seasonal, and Johnson’s
collective bargaining agreement did not permit her to be placed in
a seasonal position. She also inquired about a cast member ward-
robe position, but the position was not vacant. Johnson was not
reassigned to any position.
Instead, she remained on medical leave. Disney’s policy per-
mits employees to take a maximum of 12 consecutive months of
medical leave. After Johnson was on medical leave for more than
12 months, Disney sent her a letter advising that she would be ter-
minated unless she contacted the company with a date when she
could return to work. Johnson did not contact Disney and was ter-
minated.
Based on her termination, Johnson brought a disability dis-
crimination claim under the ADA. She alleged that she was disa-
bled because she suffered from pain from her spinal injuries that
substantially limited her ability to walk and stand and that, with
2 The parties disagree over whether the standing and walking restrictions
were two separate and distinct restrictions or, as Johnson argues, were inter-
twined, meaning Johnson could not stand for more than three hours and then
walk for 100 yards. Resolving this dispute is unnecessary to our analysis; thus,
we decline further examination.
USCA11 Case: 21-12696 Date Filed: 11/14/2022 Page: 5 of 10
21-12696 Opinion of the Court 5
reasonable accommodations, she was qualified to perform the es-
sential functions of a reassigned job.
Disney moved for summary judgment. The district court
granted the motion, ruling that Johnson failed to come forward
with sufficient evidence to show that (1) she was substantially lim-
ited in her ability to walk and stand and (2) she was a “qualified
individual” as defined by the ADA. Johnson moved for reconsider-
ation, and the district court denied her motion. Johnson appeals the
district court’s summary judgment order.
II. STANDARD OF REVIEW
We review a district court’s grant of summary judgment de
novo, viewing all evidence and drawing all reasonable inferences
in favor of the nonmoving party. Hurlbert v. St. Mary’s Health
Care Sys., Inc., 439 F.3d 1286, 1293 (11th Cir. 2006). Summary judg-
ment is appropriate only “if the movant shows that there is no gen-
uine dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Fed. R. Civ. P. 56(a). To avoid sum-
mary judgment, there must be sufficient evidence from which the
jury could reasonably find for the plaintiff; the existence of a scin-
tilla of evidence in support of the plaintiff’s position is insufficient.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986). At the
summary judgment stage, initially Disney need only point out the
absence of a genuine issue of material fact. See Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). The burden then shifts to Johnson
to go beyond the pleadings and “designate specific facts showing
USCA11 Case: 21-12696 Date Filed: 11/14/2022 Page: 6 of 10
6 Opinion of the Court 21-12696
that there is a genuine issue for trial.” Id. at 324 (internal quotation
marks omitted).
III. DISCUSSION
Johnson’s discrimination claim arises under the ADA. She
contends that the district court erred in concluding that she had not
made out a prima facie claim of ADA discrimination because she
was not (1) substantially limited in her ability to walk and stand or
(2) a qualified individual. Because Johnson failed to introduce evi-
dence showing that she was a qualified individual, we conclude
that the district court did not err in granting summary judgment
on her ADA claim.3
The ADA prohibits employers from discriminating against
qualified individuals on the basis of disability in regard to the dis-
charge of employees or other terms, conditions, and privileges of
employment. 42 U.S.C. § 12112(a). To establish a claim of discrim-
ination, an employee can show an employer’s intent to discrimi-
nate through direct or circumstantial evidence. See Batson v. Sal-
vation Army, 897 F.3d 1320, 1328–29 (11th Cir. 2018). In the ab-
sence of direct evidence of an employer’s intent to discriminate, we
apply the burden-shifting McDonnell Douglas framework. 4 Id. at
3 Because we conclude that Johnson was not a qualified individual, we need
not decide whether the district court erroneously concluded that she also
failed to establish that she was disabled.
4 See generally McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973).
USCA11 Case: 21-12696 Date Filed: 11/14/2022 Page: 7 of 10
21-12696 Opinion of the Court 7
1328–29. Under this framework, the plaintiff has the initial burden
to establish a prima facie claim of disability discrimination. Cleve-
land v. Home Shopping Network, Inc., 369 F.3d 1189, 1193 (11th
Cir. 2004).
To establish a prima facie claim of employment discrimina-
tion under the ADA, “a plaintiff must show that at the time of the
adverse employment action, she (1) had a disability, (2) was a qual-
ified individual, and (3) was subjected to unlawful discrimination
because of her disability.” Batson, 897 F.3d at 1326. Under the
ADA, a qualified individual is one who “satisfies the requisite skill,
experience, education and other job-related requirements of the
employment position . . . and, with or without reasonable accom-
modation, can perform the essential functions of such position.”
29 C.F.R. § 1630.2(m); see 42 U.S.C. § 12111(8).
If the plaintiff establishes a prima facie claim, we apply a pre-
sumption that discrimination occurred. See Smelter v. S. Home
Care Servs. Inc., 904 F.3d 1276, 1288 (11th Cir. 2018) (applying such
a presumption in the Title VII context). “The burden then shifts to
the employer to rebut the presumption by articulating a legitimate,
nondiscriminatory reason for its actions.” Id. If the employer meets
this burden of production, the presumption raised by the prima fa-
cie claim is rebutted, and the burden shifts back to the employee to
show that the employer’s proffered reason was actually a pretext
for illegal discrimination. Id. At issue here is whether Johnson made
out a prima facie claim by establishing that she was a qualified in-
dividual. We agree with the district court that the answer is no.
USCA11 Case: 21-12696 Date Filed: 11/14/2022 Page: 8 of 10
8 Opinion of the Court 21-12696
Johnson argues that the district court erred because she in-
troduced evidence showing that she was qualified for the personal-
ization artist position. Disney responds that Johnson was unquali-
fied for the personalization artist position for three reasons. First, it
asserts that she was not qualified for the personalization artist po-
sition because it was a seasonal position, and under the relevant
collective bargaining agreement, Disney could not place her into a
seasonal position.5 Second, it argues that the position required full-
5 Johnson also argues, for the first time on appeal, that the district court erred
by relying on the declaration of Christine Neuberg, a Disney Employee Rela-
tions Manager, in granting summary judgment. The Neuberg declaration re-
ferred to two external documents—a collective bargaining agreement and an
employee policy handbook—which Johnson maintains needed to be intro-
duced into the record. She argues that the references without the documents
themselves violated the best evidence rule. As an initial matter, she did not
object or raise this issue before the district court. Because we generally do not
consider arguments raised for the first time on appeal, and we see no excep-
tional circumstances to warrant disregarding this rule, we consider Johnson’s
argument abandoned. See Access Now, Inc. v. Sw. Airlines Co., 385 F.3d 1324,
1332 (11th Cir. 2004) (noting that arguments raised for the first time on appeal
are generally abandoned unless exceptional circumstances exist). But even if
we were to consider the issue, we would conclude that the use of the declara-
tion was not improper because at the summary judgment stage, “we may con-
sider . . . evidence which can be reduced to an admissible form” at trial. Row-
ell v. BellSouth Corp., 433 F.3d 794, 800 (11th Cir. 2005); see Fed. R. Civ. P.
56(c)(3). There is no indication that Disney could not produce the two docu-
ments at trial.
USCA11 Case: 21-12696 Date Filed: 11/14/2022 Page: 9 of 10
21-12696 Opinion of the Court 9
time availability, and Johnson had only part-time availability.6
Third, it contends the position required training, which Johnson
was not able to complete while on a medical leave per company
policy. In the district court, Johnson offered no evidence to refute
any of Disney’s arguments; on appeal, she merely argues that Dis-
ney was aware of the personalization artist position and her interest
in the position. Thus, we conclude that the district court did not
err in determining that Johnson was not qualified for the personal-
ization artist position.7
IV. CONCLUSION
Because we conclude that the district court did not err in de-
termining that Johnson failed to demonstrate that she was a
6 Johnson argues that she was “ready, willing, and able to accept the schedul-
ing requirements” of the personalization artist position and directs us to por-
tions of her affidavit as evidence of her availability to work full-time. Appel-
lant’s Reply Brief at 18. But we see no indication in the affidavit that she was
available to work full-time.
7 Johnson argues on appeal that she also was qualified for her original job and
for a floral sales position. But she did not argue in the district court proceedings
that she was qualified for these positions. See Access Now, Inc., 385 F.3d at
1332. In the district court proceedings, Johnson did argue that she was quali-
fied for a cast member wardrobe position. The district court rejected her ar-
gument, however, and concluded that she was not qualified for that position.
On appeal, Johnson has not argued that she was qualified for the position;
thus, she has abandoned this argument as well. See Sapuppo v. Allstate Florid-
ian Ins. Co., 739 F.3d 678, 680 (11th Cir. 2014) (noting that issues not clearly
raised in the briefs are considered abandoned, even if properly preserved at
trial).
USCA11 Case: 21-12696 Date Filed: 11/14/2022 Page: 10 of 10
10 Opinion of the Court 21-12696
qualified individual as defined by the ADA, we affirm the district
court’s order granting summary judgment to Disney. 8
AFFIRMED.
8 To the extent that Johnson appeals the district court’s denial of her motion
for reconsideration, the district court did not abuse its discretion in denying
her motion for the same reasons it did not err in granting summary judgment. | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483573/ | UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
In re KAVITA KALSY,
Miscellaneous Action No. 22-59 (RDM)
Respondent.
MEMORANDUM OPINION
This matter is before the Court on the District of Columbia’s motion to remand for lack
of subject-matter jurisdiction. Dkt. 9. In May 2022, the Chief Judge of the D.C. Superior Court
convened a panel to evaluate whether respondent Kavita Kalsy should be suspended or removed
from the Superior Court’s Criminal Justice Act (“CJA”) Panel. Kalsy, proceeding pro se,
removed that proceeding to this Court. Dkt. 1. The District of Columbia argues that the Court
lacks subject-matter jurisdiction over what is, in essence, a state administrative proceeding that
presents no federal question. The Court agrees and will, for the reasons stated below, GRANT
the District of Columbia’s motion to remand, Dkt. 9.
I. BACKGROUND
According to the notice of removal and the attached materials, Kavita Kalsy was
appointed as a provisional member of the D.C. Superior Court’s CJA Panel in 2018. Dkt. 1-1 at
4. She submitted an application for “full panel status” on August 12, 2020. Id. In response to
concerns about Kalsy’s mental health that were raised by her application, the co-chairs of the
“CJA Panel Committee,” Superior Court Judges Juliet McKenna and Peter Krauthamer,
convened a series of WebEx meetings with Kalsy in August and September 2020. Id. at 4–5.
During the third of those meetings, the co-chairs requested documentation of Kalsy’s mental
health status, based on their concern as to whether she was “capable of handling cases for the
CJA panel.” Id. at 5. Kalsy did not provide the requested documentation. Id. Instead, she
resubmitted an application for full CJA panel status almost a year later, in September 2021. Id.
In response to her renewed application, the two co-chairs again met with Kalsy and requested
documentation of her mental health status, which she again declined to provide. Id. Kalsy filed
a petition for review in the District of Columbia Court of Appeals on December 27, 2021, which
was apparently dismissed “because it was not a contested case arising under the District of
Columbia Administrative Procedure Act.” Dkt. 1 at 3.
On April 7, 2022, the new co-chairs of the CJA Panel Committee met with Kalsy by
WebEx and again requested documentation of her mental health status, which she once again
declined to provide after indicating her belief that the judges “were asking for a bribe.” Dkt. 1-1
at 5. The next month, Superior Court Chief Judge Anita Josey-Herring notified Kalsy of her
intention to appoint a panel under Super. Ct. Crim. R. 44-I that would evaluate whether Kalsy
should remain a member of the CJA panel. Id. at 6. The appointed panel, comprised of three
Superior Court judges, wrote a letter to Kalsy on May 23, 2022, setting a hearing on the matter
for June 15, 2022, id. at 3, and providing Kalsy with a “complaint” that described the basis for
any potential suspension or removal, id. at 3–6. On May 25, 2022, the panel requested that
Kalsy provide any written submissions or documentary evidence by June 10, 2022. Id. at 38.
Kalsy removed the case to this Court on June 9, 2022. Dkt. 1. The District subsequently
filed a motion to remand the matter to the D.C. Superior Court for lack of subject-matter
jurisdiction, Dkt. 9, which is now before this Court.
II. ANALYSIS
A defendant may remove any “civil action” to federal court if the federal court has
original jurisdiction over the matter. 28 U.S.C. § 1441(a). But federal courts are courts of
2
limited subject-matter jurisdiction and “possess only that power authorized by [the] Constitution
and statute.” Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Courts
“construe[] removal jurisdiction strictly, favoring remand where the propriety of removal is
unclear.” Ballard v. District of Columbia, 813 F. Supp. 2d 34, 38 (D.D.C. 2011). “The party
opposing a motion to remand bears the burden of establishing that subject matter jurisdiction
exists in federal court.” Int’l Union of Bricklayers & Allied Craftworkers v. Ins. Co. of the West,
366 F. Supp. 2d 33, 36 (D.D.C. 2005). Where, as here, a party asserts original jurisdiction based
on a federal question, “[t]he presence or absence of such jurisdiction is governed by the ‘well-
pleaded complaint rule,’ under which ‘federal jurisdiction exists only when a federal question is
presented on the face of the plaintiff’s properly pleaded complaint.’” Rivet v. Regions Bank of
La., 522 U.S. 470, 475 (1998) (quoting Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987));
see also 28 U.S.C. § 1331 (“The district courts shall have original jurisdiction of all civil actions
arising under the Constitution, laws, or treaties of the United States.”).
According to Kalsy, this Court has jurisdiction over the instant proceeding because the
Superior Court’s requests for documentation of her mental health status implicate multiple
sources of federal law, including the District of Columbia Court Reform and Criminal Procedure
Act of 1970 (the “Court Reform Act”), Pub. L. No. 91-358, 84 Stat. 473; the Federal Rules of
Civil Procedure; and this Court’s Local Civil Rules. Dkt. 1 at 1, 3; see also Dkt. 14 at 6. The
District asserts, in response, that the proceeding at issue is a “state administrative matter[]” not
subject to removal and that it “does not involve any federal question.” Dkt. 9 at 5–6. Although
the Court shares the District’s skepticism as to whether this is in fact a “civil action” that can be
removed under 28 U.S.C. § 1441(a), the Court need not reach that question because, in any
3
event, no federal question is presented on the face of the “complaint”—here, the May 23, 2022
letter describing the basis for Kalsy’s possible suspension or removal. Dkt. 1-1 at 3–6.
To the extent the May 23, 2022 “complaint” Kalsy received invokes any specific legal
authority to convene Kalsy’s hearing, it mentions only Super. Ct. Crim. R. 44-I, see Dkt. 1-1 at
6, which governs, among other things, the suspension and removal of attorneys from the
Superior Court’s CJA Panel, see Super. Ct. Crim. R. 44-I(f)(1). To be sure, Kalsy’s notice of
removal asserts that she “intend[s] to answer the complaint, relying on federal law and acts of
Congress that apply locally to the District of Columbia” once the matter has been removed to
federal court. Dkt. 1 at 4. But it is well established that federal jurisdiction exists “only when a
federal question is presented on the face of the plaintiff’s properly pleaded complaint,” Holmes
Grp., Inc. v. Vornado Air Circulation Sys., Inc., 535 U.S. 826, 830 (2002) (quoting Caterpillar
Inc., 482 U.S. at 392), and that raising federal questions in an answer or defense is typically
insufficient to create federal question jurisdiction, see Phillips Petroleum Co. v. Texaco, Inc.,
415 U.S. 125, 127–28 (1974) (“The federal questions must be disclosed upon the face of the
complaint, unaided by the answer.” (internal quotation marks omitted)).
Kalsy’s notice of removal asserts that the District of Columbia Court Reform Act, 84
Stat. 473, which established the Superior Court’s authority to promulgate criminal rules of
procedure like Rule 44-I, confers federal question jurisdiction here. Dkt. 1 at 2. As support for
this proposition, she cites Fed. R. Civ. P. 81(d)(3), which defines “federal statute” to “include[]
any Act of Congress that applies locally to the District.” Id.; Dkt. 14 at 14–15. But even
assuming the dubious proposition that this action “arises under” the Court Reform Act, 28 U.S.C.
§ 1366—not Rule 81(d)(3)—is controlling for purposes of 28 U.S.C. § 1331. And § 1366
provides that “references to laws of the United States or Acts of Congress do not include laws
4
applicable exclusively to the District of Columbia.” 28 U.S.C. § 1366. The Court Reform Act,
which was enacted “to reorganize the judicial systems of the District of Columbia,” United
States v. Hairston, 495 F.2d 1046, 1052 (D.C. Cir. 1974), applies, by its terms, to courts in the
District alone. Cf. D.C. Ass’n of Chartered Pub. Schs. v. District of Columbia, 930 F.3d 487,
491 (D.C. Cir. 2019) (concluding that the School Reform Act, 110 Stat. 1321-107 (1996) is not a
“law of the United States” under § 1331 because it “applies solely to the District” and
“establish[ed] and regulat[ed] charter schools within the District alone”). 1
To the extent that Kalsy relies on Fed. R. Civ. P. 81(d)(3) and this Court’s Local Rules
(specifically, Local Civil Rule 83.20 and Local Criminal Rule 57.31) to establish federal
jurisdiction, see Dkt. 1 at 2–3, the Court is unpersuaded. Fed. R. Civ. P. 81(d)(3) simply defines
the term “federal statute” for purposes of the Rules; it neither addresses removal nor provides a
federal cause of action. See Fed. R. Civ. P. 82 (stating that the Rules “do not extend or limit the
jurisdiction of the district courts or the venue of actions in those courts”). Nor can this Court’s
Local Rules expand the scope of the federal courts’ subject-matter jurisdiction, which “is
determined by Congress in the exact degrees and character which to Congress may seem proper
for the public good.” Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 433
1
In response to the District’s motion for remand, Kalsy also argues that this Court has federal
jurisdiction over this action because the Court can exercise supplemental jurisdiction over any
state law claims under 28 U.S.C. § 1367. See Dkt. 14 at 5–7, 17. But the federal “causes of
action” that Kalsy contends provide the anchor for her D.C. law claims assert violations of the
federal criminal laws governing bribery and gratuities, 18 U.S.C. §§ 201, 666. See Dkt. 8 at 9;
Dkt. 11 at 31–34. “As a general rule, criminal statutes do not create a private right of action” and
thus “cannot be relied upon” to establish the original jurisdiction necessary to exercise
supplemental jurisdiction over related civil claims. Saunders v. Davis, No. 15-cv-2026, 2016
WL 4921418, at *13 (D.D.C. Sept. 15, 2016). Those references to the federal criminal laws,
moreover, appear nowhere in the well-plead “complaint” that initiated the proceeding at issue.
See Dkt. 1-1 at 4–6. Any reference to these laws, then, does not cure the jurisdictional defects at
issue here.
5
(1989) (internal quotation marks omitted) (emphasis added). The Court, accordingly, concludes
that it lacks subject-matter jurisdiction over the instant action.
CONCLUSION
For the foregoing reasons, the Court will GRANT the District of Columbia’s motion to
remand, Dkt. 9.
A separate order will issue.
/s/ Randolph D. Moss
RANDOLPH D. MOSS
United States District Judge
Date: November 14, 2022
6 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483407/ | THE THIRTEENTH COURT OF APPEALS
13-21-00377-CV
IN THE MATTER OF THE MARRIAGE OF ROGELIO GUERRA
AND SUSAN RABEL GUERRA
On Appeal from the
197th District Court of Cameron County, Texas
Trial Court Cause No. 2019-DCL-02658
JUDGMENT
This Court’s judgment issued on August 18, 2022, is hereby withdrawn and the
following is substituted therefor.
THE THIRTEENTH COURT OF APPEALS, having considered this cause on
appeal, concludes that the judgment of the trial court should be affirmed. The Court
orders the judgment of the trial court AFFIRMED. Costs of the appeal are adjudged
against appellant.
We further order this decision certified below for observance.
November 10, 2022 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483412/ | THE THIRTEENTH COURT OF APPEALS
13-21-00010-CV
Swift Transportation Co. of Arizona, LLC
v.
Glenn Hegar, Comptroller of Public Accounts of the State of Texas; and Ken Paxton,
Attorney General of the State of Texas
On Appeal from the
200th District Court of Travis County, Texas
Trial Court Cause No. D-1-GN-19-008429
JUDGMENT
THE THIRTEENTH COURT OF APPEALS, having considered this cause on
appeal, concludes that the judgment of the trial court should be affirmed. The Court
orders the judgment of the trial court AFFIRMED. Costs of the appeal are adjudged
against appellant.
We further order this decision certified below for observance.
November 10, 2022 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483414/ | THE THIRTEENTH COURT OF APPEALS
13-21-00250-CR
MONTE RODNEY SCALES JR.
v.
THE STATE OF TEXAS
On Appeal from the
36th District Court of San Patricio County, Texas
Trial Court Cause No. S-17-3011CR
JUDGMENT
THE THIRTEENTH COURT OF APPEALS, having considered this cause on
appeal, concludes the judgment of the trial court should be reversed and rendered. The
Court orders the judgment of the trial court REVERSED and RENDERS judgment in
accordance with its opinion.
We further order this decision certified below for observance.
November 10, 2022 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483410/ | NUMBER 13-22-00545-CV
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
IN RE STATE FARM LLOYDS
On Petition for Writ of Mandamus.
ORDER
Before Chief Justice Contreras and Justices Benavides and Tijerina
Order Per Curiam
On November 8, 2022, relator State Farm Lloyds filed a petition for writ of
mandamus seeking to compel the trial court to: (1) vacate its order appointing attorney
Derek Salinas as umpire, and (2) render a new order appointing a “qualified umpire under
the terms of the [insurance] policy’s appraisal provision.” Relator also filed a motion for
temporary relief through which it requests that we grant a temporary stay of the trial court’s
order appointing Salinas as umpire.
The Court, having examined and fully considered the motion for temporary relief,
is of the opinion that it should be granted. Accordingly, we grant the relator’s motion for
temporary relief, and we order the trial court’s September 12, 2022 order appointing
Salinas as umpire to be stayed pending the resolution of this original proceeding or further
order of this Court. See TEX. R. APP. P. 52.10(b) (“Unless vacated or modified, an order
granting temporary relief is effective until the case is finally decided.”).
We request the real party in interest, Bernardo Vela, or any others whose interest
would be directly affected by the relief sought, to file a response to the petition for writ of
mandamus on or before the expiration of ten days from the date of this order. See id. R.
52.2, 52.4, 52.8.
PER CURIAM
Delivered and filed on the
10th day of November, 2022.
2 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483565/ | Case: 21-60959 Document: 00516543449 Page: 1 Date Filed: 11/14/2022
United States Court of Appeals
for the Fifth Circuit
United States Court of Appeals
Fifth Circuit
No. 21-60959
FILED
Summary Calendar
November 14, 2022
Lyle W. Cayce
J. Reyes Luna Esparza, Clerk
Petitioner,
versus
Merrick Garland, U.S. Attorney General,
Respondent.
Petition for Review of an Order of the
Board of Immigration Appeals
Agency No. A212 953 379
Before King, Higginson, and Willett, Circuit Judges.
Per Curiam:*
J. Reyes Luna Esparza, a native and citizen of Mexico, petitions for
review of a decision of the Board of Immigration Appeals (BIA) dismissing
his appeal and affirming the immigration judge’s (IJ’s) denial of his
application for cancellation of removal.
*
Pursuant to 5th Circuit Rule 47.5, the court has determined that this
opinion should not be published and is not precedent except under the limited
circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 21-60959 Document: 00516543449 Page: 2 Date Filed: 11/14/2022
No. 21-60959
Luna Esparza argues that the BIA erred in denying his application for
cancellation of removal based on the finding that he had failed to show that
his son would suffer exceptional and extremely unusual hardship upon
petitioner’s removal to Mexico. He further argues that the hardship standard
is unconscionable and violates his constitutional right to due process.
This court lacks jurisdiction to consider Luna Esparza’s challenge to
the BIA’s hardship determination. See Patel v. Garland, 142 S. Ct. 1614, 1622
(2022); Castillo-Gutierrez v. Garland, 43 F.4th 477, 481 (5th Cir. 2022);
8 U.S.C. § 1252(a)(2)(B). We likewise lack jurisdiction to review Luna
Esparza’s related argument that the BIA failed to consider certain relevant
factors in its hardship determination. See Sung v. Keisler, 505 F.3d 372, 377
(5th Cir. 2007).
Luna Esparza also raises a constitutional challenge to the hardship
standard. He argues that the “exceptional and extremely unusual hardship”
requirement is an “unconscionable standard” as applied by the BIA because
only applicants who can show that their qualifying relatives suffer from
“serious physical medical conditions” will be eligible for cancellation of
removal. Luna Esparza contends that the standard’s high burden violates the
due-process rights of noncitizens. This court still has jurisdiction to consider
constitutional challenges to the denial of cancellation of removal. See 8
U.S.C. § 1252(a)(2)(D); see also Patel, 142 S. Ct. at 1623.
Nonetheless, “the failure to receive relief that is purely discretionary
in nature does not amount to a deprivation of a liberty interest.” Assaad v.
Ashcroft, 378 F.3d 471, 475 (5th Cir. 2004) (internal quotation marks and
citations omitted). And cancellation of removal is a form of discretionary
relief. See 8 U.S.C. § 1229b(b)(1).
The petition for review is DISMISSED in part and DENIED in
part.
2 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483577/ | Filed 11/14/22 P. v. Dunson CA4/2
Opinion following transfer from Supreme Court
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION TWO
THE PEOPLE,
Plaintiff and Respondent, E074818
v. (Super.Ct.No. INF065236)
JACKIE LYNN DUNSON, OPINION
Defendant and Appellant.
APPEAL from the Superior Court of Riverside County. John D. Molloy, Judge.
Reversed.
Eric Multhaup, under appointment by the Court of Appeal, for Defendant and
Appellant.
Rob Bonta, Attorney General, Lance E. Winters, Chief Assistant Attorney
General, Charles C. Ragland, Assistant Attorney General, Alan Amann and Kristen
Kinnaird Chenelia, Deputy Attorneys General, for Plaintiff and Respondent.
1
In November 2007, defendant Jackie Lynn Dunson was involved with her brother
and several other men in the robbery and murder of William Dobbs. Dobbs was beaten
and his ATM card was stolen. Dobbs’s body was found in a desolate area several days
later. He had been stabbed 14 times in the head and neck, and his throat was cut.
Defendant was convicted of first degree murder and the special circumstance that
the murder was committed during the commission of a robbery. Defendant was
sentenced to life without the possibility of parole. In 2015, defendant’s convictions were
affirmed on appeal in People v. Jackie Lynn Dunson (Feb. 26, 2015, E056565) [nonpub.
opn.] (Opinion).1 On February 6, 2019, defendant filed her petition for resentencing
pursuant to Senate Bill No. 1437 (2017-2018 Reg. Sess.) (SB 1437) and former Penal
Code section 1170.952 (petition). The petition was summarily denied by the trial court.
Defendant appealed the summary denial of the petition to this court. In an
unpublished opinion, we affirmed the denial of the petition finding, based on the state of
the law at the time, that a true finding on the robbery-murder special circumstance
allegation necessarily rendered her ineligible for section 1172.6 relief.
Defendant filed a petition for review, which was granted. On October 19, 2022,
the California Supreme Court transferred the matter back to this court with instructions to
vacate our previous decision and reconsider the cause in light of People v. Strong (2022)
1 We take judicial notice of our prior Opinion on our own motion.
2 All further statutory references are to the Penal Code unless otherwise indicated.
In addition, section 1170.95 was renumbered effective June 30, 2022 to section 1172.6.
(Stats. 2022, c. 58 (A.B. 200), § 100, eff. June 30, 2022.) We will refer to the new
numbering in this opinion.
2
13 Cal.5th 698 (Strong). In Strong, the California Supreme Court found that felony
murder special-circumstance findings issued by a jury before the decisions of People v.
Banks (2015) 61 Cal.4th 788 (Banks) and People v. Clark (2016) 63 Cal.4th 522 (Clark),
which clarified the terms “major participant” and “reckless indifference to human life” in
the special-circumstance statute, do not preclude a defendant from making out a prima
facie case for resentencing of a felony-murder conviction, even if the trial evidence
would have been sufficient to support the findings under Banks and Clark.
The parties filed supplemental briefs. Defendant contends we must reverse the
trial court’s order denying his petition, and remand the matter to allow the trial court to
conduct further proceedings under section 1172.6. The People concede that remand is
appropriate. We concur. We remand the matter to the trial court for further proceedings.
FACTUAL AND PROCEDURAL HISTORY
A. UNDERLYING FACTS AND CONVICTIONS 3
In November 2007, defendant and her brother Robert Dunson (Robert) lived in the
ground floor apartment of a two-story duplex in Indio. Rogelio Zuniga and his girlfriend,
M.J., lived in the apartment above the Dunsons’ apartment. Fernando Benavidez was
Jackie’s boyfriend and visited at the apartment occasionally. Defendant sometimes
would engage in prostitution and Benavidez would bring her clients, or “dates.”
On November 25, 2007, M.J., Benavidez, Robert, Zuniga and defendant were at
the Dunsons’ apartment. Benavidez offered to find someone to bring back to the
3 The facts are taken from the Opinion.
3
apartment to have sex with defendant. Robert did not want his sister to engage in sex for
money, so he proposed that they bring a man “back to the apartment, beat his ass, rob
him, and take all of his shit.” Defendant nodded her head in agreement. Zuniga said
nothing. Benavidez left the apartment to find someone and M.J. and Zuniga went back to
their upstairs apartment.
A surveillance videotape from the Spotlight 29 casino, which was approximately
five minutes from the Dunsons’ apartment, showed Benavidez entering the casino just
after midnight during the morning of November 26, 2007. He eventually was able to
persuade the victim, William Dobbs, to come with him to the Dunsons’ apartment. They
drove together in Dobbs’s car.
At some point that night or early morning, M.J. woke to the voice of a man in the
Dunsons’ apartment screaming: “Oh, God. Please help me.” M.J. described the
screaming as “gut wrenching,” “like someone is in pain, like they were hurt [and]
screaming for someone to help them.” She also heard “very loud” sounds of banging on
a wall downstairs, “like something pretty heavy slamming up against the wall.” Zuniga
told M.J. to go back to sleep.
In the predawn hours of November 26, 2007, T.S., who was friends with Robert
and defendant, walked to the Dunsons’ apartment. As she approached, she saw
Benavidez walking away from the apartment. When she got closer to the apartment, she
heard defendant arguing, yelling, and crying. T.S. heard Jackie say, “he was acting
stupid,” and “[h]e doesn't want to give [the money] to her.” A side door to the apartment
was ajar. As T.S. passed by that door, she heard Robert yelling loudly and angrily,
4
“ ‘[g]et down, mother fucker’ ” and “[t]hese better be the right PIN numbers.” T.S.
watched Robert push a man to his knees. The man appeared to have blood under his
chin. Robert then put a plastic bag over the man’s head and used duct tape to secure the
bag to the man’s neck and face. T.S. decided to leave. As she left, she heard Robert say:
“Come on, mother fucker. We’re going for a ride.”
Robert recruited Zuniga to help him. Defendant watched as Zuniga and Robert
drove off with Dobbs in Dobbs’s car. M.J. asked for Zuniga, and defendant told her that
he and Robert had to go somewhere but that they would back.
At 4:50 a.m., defendant attempted to withdraw $500 from an ATM machine using
Dobbs’s bank card. The attempt was denied because it exceeded the daily withdrawal
limit for the account. She then successfully withdrew $200 from the ATM. An attempt
to obtain an additional $200 was denied.
M.J. went downstairs to the Dunsons’ apartment the morning of November 27.
Robert was kneeling in a corner of the living room scrubbing the walls with bleach and
pulling up the carpet. He gave M.J. a bank card and a piece of paper with a PIN number
written on it and told her to pull out as much money as she could and bring it back to
him. Between 10:26 a.m. and 11:39 a.m. on November 27, M.J. and Zuniga used
Dobbs’s bank card to retrieve approximately $1,000 from different ATMs. When she
and Zuniga returned to the Dunsons’ apartment, she gave him $300, the bank card, and
the piece of paper with the PIN number. M.J. kept the remaining cash.
Dobbs’s body was found on November 27 two miles from the Spotlight 29 casino;
he had a black bag attached to his neck with red tape. He had been stabbed with a sharp
5
instrument 14 times, mostly on his face and neck. His internal and external jugular veins
and carotid artery were severed, and his trachea was also severed. He had bruises and
abrasions on his face and scalp, and signs of blunt force trauma to his chest. He had four
broken ribs, which caused ruptures to his liver and lung. The forensic pathologist who
performed the autopsy on Dobbs described the injuries as “brutal,” and said it “looked
like perhaps some injuries were inflicted for the purpose of torture” and for “causing
pain.”
Dobb’s car was found on December 1, 2007, approximately 100 yards from the
Dunsons’ apartment. Defendant later told T.S. that Robert had killed a man and that she
had used his ATM card.
Defendant was tried with Handwerk and Benavidez. She was charged with the
first degree murder of Dobbs (§ 187, subd. (a)) and the special circumstance that the
murder was committed during the commission of a robbery (§ 190.2, subd. (a)(17)(A)).
Defendant was tried under the theories of aiding and abetting and felony murder. The
jury was instructed that they must determine as to the robbery-murder special
circumstance as follows: “If a defendant was not the actual killer, then the People have
the burden of proving beyond a reasonable doubt that he or she acted with either the
intent to kill or with reckless indifference to human life and was a major participant in the
crime for the special circumstances of robbery to be true. If the People have not met this
burden, you must find this special circumstance has not been proved true for that
defendant.” Defendant was found guilty and was sentenced to life without the possibility
of parole.
6
B. PRIOR APPELLATE PROCEEDINGS
Defendant filed an appeal. She made several claims on appeal, including that
there was insufficient evidence presented to support that she was a major participant and
acted with reckless indifference to life to support the robbery-murder special
circumstance. We rejected this claim finding that the jury could have reasonably found
that defendant was a major participant in the plan and acted with reckless indifference to
human life.
C. PETITION
On February 6, 2019, defendant filed her petition in pro. per. In her petition, she
stated that she had been convicted of first or second degree murder based on the felony
murder rule. She declared that she was not the actual killer, she did not have the intent to
kill and was not a “major participant” nor acted with “reckless indifference to human life
during the course of the crime or felony.”
On March 19, 2019, the People filed a response. On April 12, 2019, the petition
was denied but there is no record of the proceedings. Defendant filed a second petition
pursuant to then-section 1170.95 on July 29, 2019, which was identical to the petition.
The parties thereafter filed several documents with the trial court. In those
documents, defendant argued that the true finding on the robbery-murder special
circumstance did not necessarily mean she was ineligible for relief under section 1172.6.
Defendant relied on Banks and Clark, both decided after she was convicted, to support
that she could not be found guilty of the robbery-murder special circumstance under the
law as written today. The People responded defendant was found by the jury to be a
7
major participant and acted with reckless indifference to life, and that finding was upheld
by the Court of Appeal.
The petition was heard on February 14, 2020. The trial court ruled, “So—I’ve
said this a number of times. It is this Court’s belief that 1170.9[5] provides a remedy for
individuals who have not had the trier of fact determine[] beyond a reasonable doubt that
one of three predicates are true: They are the actual killer; they acted with the specific
intent to kill; or they were a major participant acting with reckless disregard. [¶] In this
particular case, [defendant] has had the trier of fact conclude that one of those predicates
is true. They concluded it beyond a reasonable doubt in their opinions. That was the trial
court. That was the jury. [¶] And the sufficiency of that finding has been specifically
reviewed on direct appeal, and the Court of Appeals opined as follows for similar
reasons: . . .” The trial court then quoted this court’s finding in the Opinion as to the
sufficiency of the evidence of the robbery-murder special circumstance. The trial court
concluded, “As such, [defendant] has had all that the law provides her. She has had a
finder of fact determine beyond a reasonable doubt that one of the current predicates is
true, and the sufficiency of that finding has been tested by the appellate court. This
petition is denied.”
DISCUSSION
In light of the Supreme Court’s decision in Strong, supra, 13 Cal.5th 698, remand
to the trial court for further proceedings is necessary.
SB 1437 became effective January 1, 2019. “[SB 1437] modified California’s
felony murder rule and natural and probable consequences doctrine to ensure murder
8
liability is not imposed on someone unless they were the actual killer, acted with the
intent to kill, or acted as a major participant in the underlying felony and with reckless
indifference to human life.” (People v. Cervantes (2020) 46 Cal.App.5th 213, 220.) As
relevant here, SB 1437 added section 189, subdivision (e), which provides, “A participant
in the perpetration or attempted perpetration of [qualifying felonies] in which a death
occurs is liable for murder only if one of the following is proven: [¶] (1) The person was
the actual killer. [¶] (2) The person was not the actual killer, but, with the intent to kill,
aided, abetted, counseled, commanded, induced, solicited, requested, or assisted the
actual killer in the commission of murder in the first degree. [¶] (3) The person was a
major participant in the underlying felony and acted with reckless indifference to human
life, as described in subdivision (d) of Section 190.2.” (§ 189, subd. (e).) Section 190.2,
subdivision (d) provides, “Notwithstanding subdivision (c), every person, not the actual
killer, who, with reckless indifference to human life and as a major participant, aids,
abets, counsels, commands, induces, solicits, requests, or assists in the commission of a
felony enumerated in paragraph (17) of subdivision (a) which results in the death of some
person or persons, and who is found guilty of murder in the first degree therefor, shall be
punished by death or imprisonment in the state prison for life without the possibility of
parole if a special circumstance enumerated in paragraph (17) of subdivision (a) has been
found to be true under Section 190.4.”
SB 1437 also created a process through which convicted persons can seek
resentencing if they could no longer be convicted under the reformed homicide law.
(§ 1172.6, subd. (a).) If the petitioner makes a prima facie showing he or she is eligible
9
for relief under section 1172.6, the court shall issue an order to show cause and hold an
evidentiary hearing. (§ 1172.6, subds. (c) & (d).) At this hearing, either party may
present new evidence and the prosecution bears the burden of proving the petitioner
could still be convicted beyond a reasonable doubt. (§ 1172.6, subd. (d)(3).)
In Strong, the California Supreme Court resolved a split of the Courts of Appeal as
to whether a special circumstance finding reached prior to Banks and Clark precluded
relief under section 1172.6. Banks and Clark “substantially clarified the law” regarding
what it means to be a major participant who acts with reckless indifference to human life
for the purposes of the special circumstance statute. (Strong, supra, 13 Cal.5th at pp.
706-707, 721.) The Strong court concluded that where a defendant’s “case was tried
before both Banks and Clark, . . . special circumstance findings do not preclude him [or
her] from making out a prima facie case for resentencing under section 1172.6.” (Strong,
supra, 13 Cal.5th at p. 721.) A court “err[s] in concluding otherwise.” (Ibid.)
In this case, defendant was convicted of the special circumstance that the murder
was committed during the commission of a robbery (§ 190.2, subd. (a)(17)(A)). Such
finding predated Banks and Clark. Hence, the special circumstance finding did not
preclude her from “making out a prima facie case for resentencing under section 1172.6.”
(Strong, supra, 13 Cal.5th at p. 721.)
In addition, this court cannot look to the record to determine whether defendant
would have been convicted after Banks and Clark. Based on the change in requirements
for a true finding on a special circumstance after Banks and Clark, defense counsel in a
case may have “have altered what evidence” would have been introduced and may have
10
“fundamentally altered trial strategies” (Strong, supra, 13 Cal.5th at p. 719.) “An after-
the-fact court review of a pre-Banks and Clark record does not account for all these
differences. . . . And as the Legislature has made explicit in a recent amendment to the
predecessor to section 1172.6, a court determination that substantial evidence supports a
homicide conviction is not a basis for denying resentencing after an evidentiary hearing.
[Citation.] Nor, then, is it a basis for denying a petitioner the opportunity to have an
evidentiary hearing in the first place.” (Id. at p. 720, fn. omitted.) “For petitioners with
pre-Banks/Clark findings, no judge or jury has ever found the currently required degree
of culpability for a first time. Allowing reexamination of the issue under these
circumstances does not permit ‘a second bite of the apple’ because the changes in the law
mean there is now ‘a different apple.’ ” (Id. at p. 718.)
As such, after Strong, “[n]either the jury’s pre-Banks and Clark findings nor a
court’s later sufficiency of the evidence review amounts to the determination section
1172.6 requires, and neither set of findings supplies a basis to reject an otherwise
adequate prima facie showing and deny issuance of an order to show cause.” (Strong,
supra, 13 Cal.5th at p. 720.) Accordingly, we must remand the matter for the trial court
to issue an order to show cause and, to the extent necessary, conduct an evidentiary
hearing. (§ 1172.6, subds. (c), (d)(1) & (3).)
DISPOSITION
The order denying defendant’s petition is reversed. On remand, the trial court
shall issue an order to show cause and conduct an evidentiary hearing as required by
11
section 1172.6, subdivisions (c) and (d)(3). We express no opinion regarding the
appropriate outcome.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
MILLER
Acting P. J.
We concur:
CODRINGTON
J.
FIELDS
J.
12 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483576/ | Filed 11/14/22 P. v. Gonzalez CA4/1
NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
THE PEOPLE, D079866
Plaintiff and Respondent,
v. (Super. Ct. No. INF1501997)
JOSE BARBA GONZALEZ,
Defendant and Appellant.
APPEAL from a judgment of the Superior Court of Riverside County,
Anthony Villalobos, Judge. Affirmed in part and reversed in part.
Siri Shetty, under appointment by the Court of Appeal, for Defendant
and Appellant.
Rob Bonta, Attorney General, Lance E. Winters, Chief Assistant
Attorney General, Charles C. Ragland, Assistant Attorney General,
Christopher P. Beesley and Britton B. Lacy, Deputy Attorneys General, for
Plaintiff and Respondent.
Convicted of committing specific sexual acts against his stepdaughter
Jane Doe, defendant Jose Barba Gonzalez appeals his separate conviction for
continuous sexual abuse of Doe during the same period. The People
appropriately concede that under settled precedent, Gonzalez’s conviction on
count 3 for continuous sexual abuse cannot stand. Accordingly, we need not
reach his alternative claim that imposition of the upper term on count 3
requires remand for resentencing based on recent amendments to the
Determinate Sentencing Law (DSL) introduced in Senate Bill No. 567 (Stats.
2021, ch. 731, § 1.3). Reversing the conviction on count 3 and correcting
Gonzalez’s presentence credits, we otherwise affirm the judgment.
FACTUAL AND PROCEDURAL BACKGROUND
Gonzalez was in a dating relationship with Selene J. and acted as a
father figure to her daughter Jane Doe. When Doe was around eight years
old, Gonzalez began sexually molesting her. He touched her vaginal area as
they sat on the living room couch—the first few times over her clothes and
then several more times under. Another six or seven incidents happened in
the family’s minivan, as Gonzalez and Doe waited in a parking lot for Selene
to return. In all, Doe estimated that Gonzalez digitally penetrated her
vagina six or seven times.
The final incident happened in the family home when Doe was eight.
Selene was outside clearing up after a yard sale; Doe was inside, watching
television. Gonzalez told Doe to follow him to the master bedroom. When she
refused, he dragged her there forcibly, threw her on a mattress, removed her
clothing, placed his mouth on her vagina, and orally copulated her. Selene
walked into the room at that moment, confronted Gonzalez, and left the home
with Doe and her other children. They returned to the house after Gonzalez
moved out. Gonzalez eventually moved back into the home, and Selene told
2
Doe not to tell anyone what happened. Doe disclosed her sexual abuse when
she was in high school, prompting Gonzalez’s arrest.
The Riverside County District Attorney charged Gonzalez with
numerous sex crimes against Jane Doe. As relevant here, a jury convicted
him as charged of forcibly sexually penetrating Doe between June 2007 and
June 2008 (Pen. Code,1 § 269, subd. (a)(5), count 1), kidnapping Doe to orally
copulate her between January 2009 and December 2015 (§§ 209, subd. (b)(1),
289, count 2), continuously sexually abusing Doe between January 2009 and
December 2015 (§ 288.5, subd. (a), count 3), and orally copulating Doe
between January 2008 and December 2015 (§ 288.7, subd. (b), count 7). At
the prosecution’s election, counts 2 and 7 were both based on the final
incident on what was labeled “Yard Sale Day.”2
At sentencing in August 2021, defense counsel cited People v. Johnson
(2002) 28 Cal.4th 240 (Johnson) to argue that the conviction in count 3 could
not stand because it was alleged to have occurred in the same time period as
counts 2 and 7. The prosecutor responded that although the date ranges for
counts 2, 3, and 7 were the same, the People made clear through argument
that the incident alleged in counts 2 and 7 was the final incident, which
“occurred at least one day after the last continuous course of conduct
incident.” Defense counsel replied that the information controlled, and that
the People’s failure to amend the information to conform to proof negated
their argument that counts 2, 3, and 7 pertained to different time periods.
1 Further statutory references are to the Penal Code.
2 In light of the People’s election to base counts 2 and 7 on the same
“final” incident, the January 2008 start date in count 7 (rather than January
2009) appears to reflect a typographical error.
3
The trial court inquired about the application of section 654 to counts 2
and 7 but did not comment on the parties’ respective stances on whether the
conviction in count 3 could stand under Johnson. It imposed an aggregate
prison term of 46 years to life. On count 3, it selected an upper term of 16
years. (§ 288.5, subd. (a).) Consecutive to that determinate sentence, the
court imposed an indeterminate sentence of 30 years to life, consisting of
consecutive 15-years-to-life terms on counts 1 and 7. (§§ 269, subd. (b), 288.7,
subd. (b).) It stayed the indeterminate sentence on count 2 pursuant to
section 654 because it was based on the same conduct as count 7.
DISCUSSION
Gonzalez argues that pursuant to section 288.5, subdivision (c) and
Johnson, supra, 28 Cal.4th 240, he could not be separately convicted of
continuous sexual abuse (count 3), oral copulation of a child under the age of
10 (count 7), and kidnapping for oral copulation (count 2) because all three
convictions involved the same victim and occurred during the same time
period. The People concede that Johnson is “dispositive” and agree with
Gonzalez that his conviction for continuous sexual abuse in count 3 must be
reversed. We agree with the parties.
Section 288.5 was enacted in response to a series of court decisions
reversing convictions for child molestation based on trial testimony that
failed to specifically identify the date or place of specific charged acts.
(Johnson, supra, 28 Cal.4th at pp. 242−243; Stats. 1989, ch. 1402, § 1.) To be
convicted of continuous sexual abuse under section 288.5, the jury need only
agree that the requisite number of sexual acts occurred, not on the acts
themselves. (§ 288.5, subd. (b).) Nevertheless, the statute “imposes certain
limits on the prosecution’s power to charge both continuous sexual abuse and
specific sexual offenses in the same proceeding.” (Johnson, at p. 243.) As
4
relevant here, “[n]o other act of substantial sexual conduct, as defined in
subdivision (b) of Section 1203.066, with a child under 14 years of age at the
time of the commission of the offenses . . . involving the same victim may be
charged in the same proceeding with a charge under this section unless the
other charged offense occurred outside the time period charged under this
section or the other offense is charged in the alternative.” (§ 288.5, subd.
(c).)3
As the Supreme Court explained in Johnson, this statutory limitation
means that continuous sexual abuse and specific sexual offenses pertaining
to the same victim over the same time period may be pleaded only in the
alternative. By extension, a defendant may not stand convicted of continuous
sexual abuse and specific acts where both are alleged in the same time
period. (Johnson, supra, 28 Cal.4th at p. 248.) Where this rule is violated in
the trial court, the appropriate remedy on appeal is to reverse one conviction
and leave standing the conviction that is most commensurate with the
defendant’s culpability. (People v. Torres (2002) 102 Cal.App.4th 1053, 1059;
People v. Bautista (2005) 129 Cal.App.4th 1431, 1437−1438; see also People v.
Rojas (2015) 237 Cal.App.4th 1298, 1308−1309; People v. Wilson (2019) 33
Cal.App.5th 559, 573−574.)
At the prosecutor’s election, counts 2 and 7 pertain to the identical
incident—the final molestation on “Yard Sale Day.” The time period for this
incident (January 2009 to December 2015) overlaps exactly with the time
period for continuous sexual abuse charged in count 3. Because these events
could only be pleaded in the alternative, Gonzalez cannot be convicted of
both. (Johnson, supra, 28 Cal.4th at p. 248.) As Gonzalez argues and the
3 Penetrating the victim’s vagina by oral copulation amounts to
substantial sexual conduct under section 1203.066, subdivision (b).
5
People concede, the appropriate remedy is to reverse his conviction in count 3
for continuous sexual abuse. This leaves standing his convictions on count 2
and 7, which carry a longer indeterminate term that is more commensurate
with Gonzalez’s culpability.4
Our reversal of Gonzalez’s conviction on count 3 would typically
necessitate remand for a full resentencing hearing as to all counts. (People v.
Buycks (2018) 5 Cal.5th 857, 893.) But the indeterminate sentences imposed
on the remaining counts in this case (counts 1, 2, and 7) are mandatory,
eliminating the need for resentencing.5 Although the parties agree that the
abstract of judgment contains an error as to Gonzalez’s presentence custody
credits, we may correct this mistake on appeal without remand. (People v.
Guillen (1994) 25 Cal.App.4th 756, 764.)6 We order the abstract of judgment
to be corrected to reflect a total of 2,417 credits rather than the 2,388 now
shown.
4 Because we conclude Gonzalez’s conviction on count 3 must be
reversed, we do not reach his alternative argument that his upper term
sentencing on that count necessitates remand pursuant to Senate Bill No.
567 (Stats. 2021, ch. 731, § 1.3).
5 Finding Gonzalez indigent, the sentencing court imposed a minimum
$300 restitution fine under section 1202.4. The People do not seek remand to
impose a higher fine and instead suggest that we correct the abstract of
judgment without remand.
6 At sentencing, the trial court noted that Gonzalez had earned credit for
at least 2,388 days (2,077 actual plus 311 conduct days) and directed the
probation department to prepare an updated credit memorandum. That
credit memorandum stated that Gonzalez earned 2,417 days of presentence
credit (2,102 actual plus 315 conduct days). However, the abstract of
judgment incorrectly reflects only 2,388 credits.
6
DISPOSITION
The judgment is reversed in part, striking the conviction on count 3. In
all other respects, the judgment is affirmed. The clerk of the superior court is
directed to prepare an amended abstract of judgment noting the stricken
conviction and reflecting that Gonzalez earned 2,417 days of presentence
custody credit (2,102 actual plus 315 conduct days). Once prepared, the clerk
is directed to forward a copy of the amended abstract of judgment to the
Department of Corrections and Rehabilitation.
DATO, J.
WE CONCUR:
McCONNELL, P. J.
DO, J.
7 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490536/ | MEMORANDUM ON PETITION FOR CONTEMPT
RICHARD STAIR, Jr., Bankruptcy Judge.
At issue is whether the actions of The Original Great American Chocolate Chip Cookie Company, Inc. (respondent) constitute a willful violation of the automatic stay entitling Donald Hiers (debtor) to recover damages. 11 U.S.C.A. § 362(h) (West Supp.1987).
I
On May 12, 1987, Michael J. O’Con-nor, an attorney, filed a Chapter 18 petition on behalf of the debtor.1 Respondent’s *641attorney has stipulated that respondent had notice of the bankruptcy filing. At the time of the filing of the petition the debtor was the sublessee in possession of certain premises, leased from the respondent, in the Johnson City Mall. Debtor, doing business on these premises as a licensee of the respondent, owned the equipment on the business premises. He ceased such business near the end of May 1987.
On May 27, 1987, fifteen days after the filing of debtor’s Chapter 13 petition, respondent’s attorney, Jeff Anderson, phoned O’Connor to obtain permission to take physical possession of the leased premises. O’Connor assented and, after learning the locks at the premises had been changed within hours of their conversation, wrote the following letter, dated May 27, 1987, to Anderson:
Dear Mr. Anderson:
■This letter will serve to confirm our telephone conversation of this date in which we agreed that although the locks had been changed at Dr. Hier’s franchise operation in the Johnson City Mall, The Original Great American Chocolate Chip Cookie Company (“Cookie Company”) does not assert any claim on the equipment located in the premises which he subleased from the Cookie Company.
Dr. Hiers remains amenable to the sale of all or part of the equipment to the Cookie Company. You may wish to renew this offer to your client and see if they are willing to purchase the equipment at a fair market price. Since Dr. Hiers no longer has access to the store, it is understood that reasonable notice will have to be given requesting that he move his equipment. Until the equipment is moved, the Cookie Company may store its batter in the outside refrigeration unit.
If I have inaccurately stated any aspect of our conversation, then please advise immediately so that the misunderstanding can be cleared up. I am still hopeful that a settlement can be reached regarding the amount of the Cookie Company’s claim in Dr. Hier’s Chapter 13 case. I look forward to hearing from you, and remain,
Yours very truly,
Michael J. O’Connor
Attorney at Law
Anderson did not subsequently protest that the understanding expressed in O’Connor’s letter differed from their prior phone conversation.
Anderson got the impression from O’Connor that the debtor was going to pick up his equipment during the afternoon of May 27, 1987. Accordingly, he arranged for an official of respondent to be present at the business premises. However, when the debtor had not arrived by 7:30 p.m. the official left. Apparently the debtor did arrive after respondent’s official had departed. He could not remove his equipment because the locks had been changed. He was unaware of O’Connor’s agreement with Anderson to: (1) surrender possession of the premises to respondent and (2) give reasonable notice to respondent of intent to remove the equipment. On the evening of May 27, 1987, the debtor was accompanied by his daughter, who jumped over the counter at the business premises.
On May 28, 1987, Anderson informed O’Connor that respondent had instructed him not to allow the debtor to remove any assets from the business premises. Anderson indicated to O’Connor that respondent did assert an interest in the equipment on the premises. He referred O’Connor to the license agreement between the respondent and the debtor and contended the agreement gave respondent a security interest similar to a right of setoff. At this time O’Connor told Anderson that the respondent was violating the automatic stay.
The next day, May 29, 1987, Anderson told O’Connor respondent had reconsidered and would permit removal of debtor’s equipment, but respondent insisted that someone other than the debtor must actual*642ly remove the equipment. Respondent would not permit the debtor to enter the business premises. Later the same day Anderson advised O’Connor that respondent had again reversed its position and would not permit anyone to remove any of the equipment. Thereafter, Anderson notified O’Connor that respondent was willing to permit removal of all the equipment with the exception of the counters and heavy refrigeration equipment.
On June 1, 1987, Anderson called O’Con-nor to tell him respondent had moved some of the equipment to a vacant store site in the Johnson City Mall and that the debtor could come and get it. Anderson further told O’Connor that respondent would require a bond, in the amount of either $7,000.00 or $7,500,00, before the debtor could remove items from his former business premises. According to Anderson the purpose for the bond was to indemnify respondent for any damage to the counters that might occur as other items of equipment were removed. The debtor refused to post any bond. Further, O'Connor told Anderson the debtor would tolerate no more and that a petition for contempt would be filed.
On June 4, 1987, the debtor filed his “Petition For Contempt.” Contending respondent’s actions “constitute an egregious deprivation of his rights to possess property of the estate,” the debtor requests an award of both actual and punitive damages.
II
Section 362 of title 11 of the United States Code enacts in part:
Automatic Stay
(a) Except as provided in subsection (b) of this section [immaterial herein], a petition filed under section 301, 302, or 303 of this title ... operates as a stay, applicable to all entities, of—
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(3) any act to obtain possession of property of the estate or of property from the estate or to exercise control over property of the estate;
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(h) An individual injured by any willful violation of a stay provided by this section shall recover actual damages, including costs and attorney’s fees, and, in appropriate circumstances, may recover punitive damages.
11 U.S.C.A. § 362 (West Supp.1987).
The debtor testified that on May 28, 1987, he took a prospective purchaser to view the equipment at his former business premises. He had been told the equipment could be removed as long as he personally did not enter the premises. Any prospective sale was chilled when Anderson, who was also present, told the debtor not to remove anything from the premises.
Anderson testified it appeared to him a sale of the equipment was taking place when the debtor was at the business premises on May 28, 1987; he told the debtor to consult O’Connor because he knew a sale would have to be approved by the court. Anderson further testified he was conscious of the automatic stay, as was respondent; he made the decision not to permit removal of the equipment on May 28, 1987; respondent retained possession to prevent the sale of the equipment, but there was no intent to violate the automatic stay.
The proof adduced at the July 21, 1987 hearing on debtor’s contempt petition refutes respondent’s denial of any willful violation of the automatic stay. It is patently clear that respondent, in a conscious effort to preclude debtor from regaining possession of his equipment, attempted to, and did, exercise control over property of the debtor’s estate in violation of the automatic stay.
Pursuant to § 362(h), the debtor is entitled to recover $204.00, representing a $4.00 expense plus $200.00 in lost income, and attorney fees of $1,556.00 and $720.00 for the services of Mr. O’Connor and Ms. Fugate, respectively. Further, because the violations of the automatic stay were willful, not innocent, the debtor shall also recover $1,000.00 from respondent as punitive damages with this sum to be paid *643directly to Frank D. Gibson, the debtor’s Chapter 13 trustee, for payment against all allowed claims upon confirmation of the debtor’s plan; provided, however, that if the debtor’s plan is not confirmed the trustee shall remit this sum to the debtor.
. Because O'Connor would be a necessary witness, the court authorized him to employ Mar*641garet Fugate for the purpose of representing the debtor at the hearing on his petition for contempt. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490537/ | MEMORANDUM OPINION
TIMOTHY J. MAHONEY, Bankruptcy Judge.
Confirmation hearing in this Chapter 12 case was held on June 1, 1987. Nancy Thompson of Walthill, Nebraska, appeared on behalf of the debtor. Charles Balsiger of Norfolk, Nebraska, appeared on behalf of creditor Federal Land Bank and Richard Lydick appeared as trustee.
Evidence was produced and the Court finds that the debtor is qualified as a family farmer debtor under Chapter 12 of the Bankruptcy Code.
The only issue for decision by the Court is whether or not this debtor may separate his acreage containing the farm house and buildings, pay for the acreage in cash and then pay off the balance of the secured claim of the Federal Land Bank over time.
The debtor argues that the Federal Land Bank will receive the full value of its allowed secured claim by such procedure and *718that treating the acreage of “homestead” as a separate parcel simply is a modification of the mortgage lien held by the Federal Land Bank and is permissible under Chapter 12. In addition, the debtor argues that the Nebraska Legislature authorized such modification of the creditor’s mortgage lien in 1986 by the passage of Legislative Bill 3, the Farm Homestead Protection Act, Legislature of Nebraska, Eighty-ninth Legislature, Third Special Session. This statutory change was effective November 21, 1986.
The position of the Federal Land Bank is that the state law relied upon for authority by the debtor provides that for mortgages executed prior to November 21, 1986, the debtor, at a sheriffs sale following a foreclosure judgment, has the right to bid on the “homestead” designated by the debtor and if the price obtained at the sale from the homestead and farm land being offered separately equals or exceeds the price obtained by offering the farmstead as one unit, the debtor has the right to purchase the “homestead”. The Federal Land Bank alleges that the new state law specifically directs that for mortgages executed before the effective date of the law the only manner in which the debtor may sever or partition his “homestead” from the total unit covered by the mortgage is through the sale process and that under such state law the debtor is not permitted to make such severance by the “appraisal” process. The Federal Land Bank further argues that the values agreed upon in this case for the total unit and the separate “homestead” were arrived at by the appraisal process and, therefore, the Nebraska Statute is inapplicable.
Prior to the Chapter 12 case being filed, a decree of mortgage foreclosure was taken in the State Court. The debtor exercised his right to a nine-month stay on the Order of Sale and Foreclosure and the stay expired prior to Chapter 12 being filed.
In the Chapter 12 case the debtor proposes that upon payment of $20,000 to the Federal Land Bank for the “homestead” the homestead should be partitioned and set off free and clear of the lien of the Federal Land Bank.
The judgment lien of the Federal Land Bank is in the amount of $113,607.78 together with per diem interest of $41.91635 after June 16, 1986, plus costs.
The parties have agreed upon the value of all of the land covered by the Federal Land Bank mortgage and foreclosure judgment at $63,000. The parties have additionally agreed that the “homestead” which the debtor proposes to purchase for cash is worth $20,000 of that $63,000 total. Pursuant to the plan, the debtor would pay the balance of $43,000 over a period of years at 10% per year.
The parties apparently prefer that this Court decide this case based upon an analysis of the newly-enacted state statute. This statute has not been interpreted by the Nebraska Supreme Court and, since this Court believes that federal bankruptcy law can be used to determine the legal issue, it will decline the opportunity to interpret the Nebraska Statute in this case.
To determine whether or not the debtor in a Chapter 12 case may sever a parcel of real estate included under a mortgage with other real estate, pay cash for the severed portion and then pay the balance of the allowed secured claim over time, the Court refers to 11 U.S.C. § 1206 and 11 U.S.C. § 1222(b)(2). Section 1206 states:
After notice and a hearing, in addition to the authorization contained in Section 363(f), the trustee in a case under this chapter may sell property under Section 363(b) and (c) free and clear of any interest in such property of an entity other than the estate if the property is farm land or farm equipment, except that the proceeds of such sale shall be subject to such interest.
Section 1222(b) states in relevant part: Subject to sub-sections (a) and (c) of this section, the plan may—
(2) modify the rights of holders of secured claims, or holders of unsecured claims, or leave unaffected the rights of holders of any class of claims.
Section 363(b)(1) provides: *719The trustee, after notice and a hearing, may use, sell, or lease, other than in the ordinary course of business, property of the estate.
It is clear that Section 1222(b)(2), on its face, permits the rights of holders of secured claims, such as the Federal Land Bank in this case, to be modified. It is also clear that Section 1206 permits the sale of property of the estate following the appropriate notice and hearing. Property of the estate being sold pursuant to Section 1206 is free and clear of the interest of the party holding an allowed secured claim if the property is farm land. It further is clear that the interest of the creditor attaches to the proceeds of such sale.
In this case the debtor desires to sell a severable portion of farm land which is subject to the mortgage and now foreclosure judgment of the Federal Land Bank. The parties have agreed upon the fair market value of that portion and upon the fair market value of the balance of the real estate.
The confirmation hearing was held upon notice to the affected creditor and that affected creditor did participate in the hearing.
The plan proposes to pay the actual cash value as determined by the parties, $20,000, to the Federal Land Bank upon confirmation. The plan further proposes to pay the balance of the Federal Land Bank’s allowed secured claim, $43,000 over time, with the appropriate interest rate. This Court concludes that the plan as proposed by the debtor does meet all of the confirmation requirements and that severable parcels of farm land may be sold free and clear of the claims of the secured creditor. Since there is no evidence before this Court that the severance of the “homestead” will affect the market value of the balance of the farming unit, the Court does not need to speculate with regard to possible defaults by the family farmer on future payments to the Federal Land Bank, nor upon the value of the remaining parcels subject to the mortgage at some future point in time.
Judgment will be entered on separate journal entries. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490538/ | OPINION
PER CURIAM.
By this action, appellant challenges the imposition of a use tax by appellee California State Board of Equalization on the leasing of property purchased from the estate of the debtor. Appellant objects to the state’s use tax on the grounds that a previous order of the trial court enjoined the state’s attempt to impose a sales tax at the time appellant purchased equipment at a bankruptcy liquidation sale.
The bankruptcy court declined the relief sought herein for several reasons; including the fact that the use tax sought to be imposed upon the appellant was separate and different from the sales tax previously enjoined; that the court lacked jurisdiction to hear the dispute, and that even if jurisdiction existed, the court would abstain from determination of the matter. Appellant timely appealed the order of the bankruptcy court. For the reasons set forth below, we reverse.
FACTS
The debtor herein, China Peak Resort, operated a ski resort. After financial difficulties, it filed a petition for relief under Chapter 11, 11 U.S.C., et seq. A state court receiver had already been appointed. Acting pursuant to authority of the bankruptcy court, the receiver engaged in negotiations for the sale of the assets of China Peak to the appellant. The purchase agreement was approved by the bankruptcy court. The California State Board of Equalization (“Board”), appellee herein, sought to impose a sales tax upon this conveyance. The receiver brought an adversary action challenging this tax, claiming the transaction to be exempt from taxation by the appellee. The bankruptcy court held the transaction exempt pursuant to 28 U.S.C. Section 960 and the Ninth Circuit holdings in California State Board of Equalization v. Goggin, (“Goggin I”) 191 F.2d 726 (9th Cir.1951), cert. denied, 342 U.S. 909, 72 S.Ct. 302, 96 L.Ed. 680; California State Board of Equalization v. Goggin, (“Goggin II”) 245 F.2d 44 (9th Cir.1957), cert. denied, 353 U.S. 961, 77 S.Ct. 863, 1 L.Ed.2d 910, on the basis that the sale was a liquidation of the bankruptcy estate.
Appellant Sierra Summit subsequently began operations of the ski resort, including the renting of ski equipment previously purchased from the estate. An audit of the business was conducted by the Board. Appellant was found to have understated its rental income, resulting in a tax liability. Sierra Summit contends that this income is exempt from taxation due to the *759prior order of the bankruptcy court. The prior ruling provided that:
Defendant, California State Board of Equalization, its representatives, agents and employees are hereby permanently restrained and enjoined from commencing or continuing any act to impose, determine, assess or enforce a sales or other tax against the said Receiver, debt- or, its principals or other parties by reason of the sale of the assets of China Peak Resort, Ltd. to Snow Summit Ski Corporation....
The Board contends that the use tax which they are seeking to impose upon the appellant is not precluded by the exemption contained in the above order.
DISCUSSION
We must first determine whether this Court has jurisdiction over the matter presented herein. The trial court found that it had no jurisdiction based upon 28 U.S.C. Section 1341, which provides as follows:
The district courts shall not enjoin, suspend or restrain the assessment, levy, or collection of any tax under State law where a plain, speedy and efficient remedy may be had in the courts of such State.
The Ninth Circuit has stated that this provision does not preclude an injunction consistent with the administration of a bankruptcy estate. See Goggin I, supra, at 728. As mentioned above, the trial court previously issued an injunction against the Board, precluding an imposition of a sales tax upon the liquidation sale of the items from the estate.
By this action, appellant asked the trial court to determine the application of its previous order to the facts presented herein and to make a determination of whether the Board acted in contempt of the previous injunction. Inherent in - the court’s jurisdiction, as defined by 28 U.S.C. Section 157, is the ability to determine the application of its previous orders. Therefore, based upon the request for review of its previous order, jurisdiction was proper for the limited purpose of determining compliance by the Board with the terms of the previous injunction.
Notwithstanding the above, the trial court found that if it did have jurisdiction, abstention was proper in the present case. Abstention is governed by 28 U.S.C. Section 1334(c). Pursuant to 1334(c)(1), a court may abstain from determination of an issue in the interest of justice, the interest of comity with State courts or respect for State law.
The record herein does not support the trial court’s decision to abstain. The relief sought was an interpretation of the court’s previous order. Abstention would require another court or forum to determine the application of the injunction entered by the bankruptcy court. In addition, although there is a state system for reviewing the Board’s assessment, a California state court decision1 has indicated that it is not bound by the decisions of the Ninth Circuit in Goggin I and Goggin II. Under these circumstances, abstention would preclude meaningful review of the appellant’s claims.
In light of the above, the bankruptcy court abused its discretion in its decision to abstain from determination of the propriety of the use tax assessment by the Board.
As the trial court has jurisdiction and abstention is improper on these facts, the merits of the issue presented, i.e. the propriety of the imposition of a use tax upon equipment rented after a tax-free acquisition of the property from a bankruptcy estate liquidation, must be determined.
At oral argument, counsel for the Board indicated that the use tax assessed herein occurs only in a situation where items are used, or in this case rented, and a sales tax was not paid on the original purchase of the items. In addition, the dissent points out that this use tax is assessed against the party who leases/uses the property *760rather than upon the purchaser from the bankruptcy estate. See C.S.U.T.R. 1660(c)(1).
While 1660(c)(1) does impose this burden, 1660(c)(2) exempts all transactions from this tax where sales tax was paid upon the purchase of the equipment by the lessor. Therefore, the lessee/user liability for such a use tax arises only where sales tax was not paid upon the equipment at the time of purchase, e.g. a bankruptcy liquidation sale. Hence, the conduct of the purchaser from the bankruptcy liquidation sale, i.e. whether sales tax is paid, is the exclusive factor which determines whether a use tax will be imposed. Subjecting all subsequent lease/use transactions to a use tax places a burden upon the purchaser of such equipment from the bankruptcy estate. This type of tax is expressly forbidden in the Ninth Circuit:
Whatever the protean forms of a statute may be, or whatever subtle ingenuity of legislative tax advisors may suggest now or in the future, the tax is in fact based upon the sale; the sale is for the essential purpose of liquidating; the liquidation process was burdened thereby. The paramount authority in the bankruptcy field can be limited only by Congress. But, since Congress has already designated sales in the course of operation of a business as the sole area where the state may impose a tax of any type, [ [FTNT] 28. U.S.C. Section 960] essential sales in liquidation are inevitably free from such imposition.
Goggin II, 245 F.2d, at 46. This assessment of a use tax does not arise but for the failure of the purchaser to pay sales tax upon the liquidation sale from the bankruptcy estate. It is therefore based in fact upon the sale and is proscribed by the Goggins’ decisions.
In light of the injunction previously entered by the bankruptcy court and the holdings in the Goggins’ decisions, the Board improperly assessed a use tax upon the rentals of ski equipment that had been acquired by the appellant at a bankruptcy liquidation sale. Accordingly, the order of the trial court allowing the assessment is REVERSED. This matter is hereby REMANDED with instructions to the bankruptcy court to enter an order consistent with the above disposition.
. See Debtor Reorganizers, Inc. v. State Board of Equalization, 58 Cal.App.3d 691, 130 Cal.Rptr. 64 (1976). | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490541/ | DECISION AND ORDER DENYING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT
WILLIAM A. CLARK, Bankruptcy Judge.
This matter is before the court upon “Defendants’ Motion for Summary Judgment as to Plaintiff’s Cause of Action Alleging Willful and Malicious Injury to Crops.”
In its amended complaint, plaintiff alleges that “debtros/defendants unlawfully and without authorization disposed of ... crops which were subject to a security interest held by plaintiff by secretly and fraudulently transferring the assets to unknown third parties.” (Doc. 17) Defendants have moved for summary judgment on the ground that a security agreement signed by them and an accompanying fi*183nancing statement do not comply with Ohio law and, therefore, plaintiff was never granted a valid security interest in defendants’ crops nor was any purported security interest ever perfected against third parties. Consequently, defendants argue, the plaintiff had no property interest in the crops which could be maliciously converted or injured by defendants. Specifically, defendants refer to Ohio Rev. Code § 1309.-14(A)(1) [U.C.C. § 9-203(l)(a) ] which provides that a security interest is not enforceable against a debtor or third parties with respect to growing crops unless the security agreement contains a description of the land concerned.1 Defendants submit that there is nothing in either the security agreement or the financing statement indicating where defendants’ crops were to be grown. An examination of the security agreement (Exhibit A), however, reveals that defendants are in error regarding their allegation of a complete absence of a real estate description. The security agreement describes the collateral as “all growing crops, consisting of approximately 750 acres com, 300 acres beans, and 200 acres of wheat.” Provision 2 of the security agreement states that the collateral shall be kept at the address shown at the beginning of the security agreement, i.e. 19907 Botkins Rd., Jackson Center, Ohio. The issue before the court, then, is whether the listing of defendants’ street address is an insufficient description of the real estate for purposes of Ohio Rev. Code § 1309.-14(A)(1). Defendants have not furnished the court with any Ohio case law concerning this precise issue nor has the court been able to locate such a case. However, Ohio Rev. Code § 1309.08 [U.C.C. § 9-110] provides that “any description of personal property or real estate is sufficient whether or not it is specific if it reasonably identifies what is described.”
The requirement of description of collateral (see RC § 1309.14 [UCC 9-203] and Comment thereto) is evidentiary. The test of sufficiency of a description laid down by this section is that the description do the job assigned to it— that it make possible the identification of the thing described. Under this rule courts should refuse to follow the holdings, often found in the older chattel mortgage cases, that descriptions are insufficient unless they are of the most exact and detailed nature, the so:called “serial number” test....
Official Comment to U.C.C. § 9-110.
With respect to the role of Ohio Rev. Code § 1309.14 [U.C.C. § 9-203] it has been observed that “[t]he primary function of 9-203 is that of a statute of frauds; it is designed mainly to minimize disputes over whether there was an agreement and over what collateral it could have covered.” White and Summers, Handbook of the Law Under the Uniform Commercial Code, p. 910 (2d ed. 1980).
For defendants to prevail on their motion for summary judgment, it must appear that there is no genuine issue as to any material fact and that the defendants are entitled to a judgment as a matter of law. Fed.R. Civ.P. 56(c). Defendants are not entitled to judgment as a matter of law unless it can be said that under Ohio law a listing of a street address on a security agreement is per se an insufficient description of real estate for purposes of Ohio Rev. Code § 1309.14 [U.C.C. § 9-293] or that the undisputed facts in the case before the court establish that the description was inadequate. It is clear from the Official Comment to U.C.C. § 9-110 [Ohio Rev. Code § 1309.08] that something less than a precise legal description of real estate is required to be contained in a security agreement. Because of the flexibility contained in the “reasonable identification” standard of Ohio Rev. Code § 1309.08 and based on the lack of direction from Ohio case law, this court cannot find that defendants’ de*184scription of their real estate by street address is as a matter of Ohio law inadequate for purposes of Ohio Rev. Code § 1309.14 [U.C.C. § 9-203]. In examining the particular facts of the case before the court, nothing has been submitted by defendants indicating that the description of defendants’ real estate in the security agreement was insufficient to enable the parties to reasonably identify defendants’ land. (The court assumes that defendants, at least, knew the location of their own land.) Therefore, a valid and enforceable security agreement existed between plaintiff and defendants. (It is not necessary to this decision and the court makes no finding regarding the adequacy of a street address for purposes of “perfecting,” as opposed to creating, a security interest.)
For the foregoing reasons defendants are not entitled to judgment as a matter of law under Fed.R.Civ.P. 56 and defendants’ motion for summary judgment is DENIED.
. Defendants also cite Ohio Rev. Code § 1309.39 [U.C.C. § 9-402] which requires any financing statement covering growing crops to contain a description of the pertinent real estate. That statute, however, involves perfection of a security interest against third parties. Perfection is irrelevant in the instant matter; the issue is whether the security agreement is enforceable between the original parties to the security agreement and is governed by Ohio Rev. Code § 1309.14. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490542/ | *205MEMORANDUM AND ORDER
KENNETH J. MEYERS, Bankruptcy Judge.
This matter is before the Court on plaintiff’s Complaint to Determine the Nature, Extent and Validity of Liens. Plaintiff has requested that the Court determine the lien priorities of Salem National Bank (“Bank”) and the Farmers Home Administration (“FmHA”) in certain equipment, livestock and crops of Skelton Farms. The relevant facts are as follows:
Prior to 1980, Fred Skelton owned a farm in Marion County, Illinois on which he maintained grain and hog operations. He periodically borrowed money from FmHA, and to secure payment of those debts, Mr. Skelton granted security interests to FmHA in all of his livestock and equipment. FmHA subsequently filed with the Recorder of Deeds a number of financing statements showing FmHA as the secured party, and identifying all livestock and equipment as collateral. The first such statement was filed on April 12, 1979 and was continued by the filing of a proper continuation statement on April 11, 1984.
In 1980, Fred Skelton and his son, David, formed a general partnership known as Skelton Farms. Since that time, the Skel-tons have maintained a hog operation on property owned by Fred Skelton and situated in Marion County, Illinois.
In February 1984, Fred and David Skel-ton, on behalf of Skelton Farms, executed and delivered to the Bank a promissory note for the sum of $180,000.00. The Skel-tons, individually and on behalf of Skelton Farms, also executed and delivered to the Bank a written security agreement, granting to the Bank a security interest in all livestock and equipment of Skelton Farms. The Bank then filed the appropriate financing statements with the Recorder of Deeds. Frank Bredar, the County Supervisor of FmHA in Marion County, also delivered to the Bank, in February 1984, two subordination agreements with respect to certain listed financing statements executed by Fred and David Skelton. Uftder the terms of the agreements, FmHA agreed to subordinate its lien in 1984 crops and “livestock sales and breeding stock.” The subordination was limited to $180,000.00, which was to be repaid by March 1, 1985.
In February 1985, the Bank and FmHA entered into a “Lender’s Agreement,” pursuant to which the Bank was designated as an “approved lender” for processing and receiving loan note guarantees issued by FmHA. Under this agreement, the Bank was responsible for servicing any loan made by the Bank, and specifically, was obligated to assure that proceeds from the sale or other disposition of collateral “are applied in accordance with the lien priorities on which the guarantee is based, except the proceeds from the disposition of collateral, such as machinery, equipment, furniture or fixtures, may be used to acquire property of [a] similar nature without written concurrence of FmHA.” (Lender’s Agreement, ¶ VIII(C)(5)(d)).
On April 4, 1985, Glenn DeFur, the Bank’s Vice-President, sent two separate letters to Frank Bredar, requesting loan note guarantees for loans that were to be extended to Fred and David Skelton, each for the sum of $90,000.00. (Separate requests for $90,000.00 each, instead of a single application for the guarantee of a loan for $180,000.00, were submitted at the suggestion of Frank Bredar.) An “Application for Guaranteed Loan” that was attached to each letter showed an indebtedness to the Bank in the amount of $180,-000.00 that was due in April 1985. FmHA issued conditional commitments to guarantee the loans on April 5, 1985.
In May 1985, Fred and David Skelton, individually and on behalf of Skelton Farms, executed and delivered to the Bank two promissory notes, each for the sum of $90,000.00. The Bank then issued two $90,000.00 checks to the Skeltons. $172,-169.06 was applied by the Bank to pay in full three notes of Skelton Farms, and $1,638.00 was paid to the Bank in satisfaction of FmHA’s guarantee fees. Subsequently, in August 1985, Frank Bredar executed two loan note guarantees in favor of the Bank, each in the sum of $90,000.00, with respect to the loans made to Fred and David Skelton by the Bank.
*206According to the evidence presented at trial, Skelton Farms’ gross receipts totaled $337,148.00 in 1984 and $418,451.81 in 1985. Fred or David Skelton routinely took checks representing sales of their production to the FmHA office in Marion to obtain the endorsement of one of FmHA’s officers. The Skeltons would then take the checks to the Bank for endorsement by one of the Bank’s officers. The checks were subsequently deposited in Skelton Farms’ checking account to pay for operating expenses or were given to the Bank for payment on debts owed by Skelton Farms.
The Bank states that from May 17, 1985 to December 30, 1986, it received and applied $26,442.50 toward interest that accrued under the notes previously signed by Fred and David Skelton. No sums were applied toward principal, and the Bank now contends that it possesses a perfected and paramount security interest in the livestock of Skelton Farms to the extent of $180,-000.00. More specifically, the Bank contends that 1) FmHA obtained a perfected security interest in the livestock of Fred Skelton in 1979, but failed to obtain a security interest in the livestock of Skelton Farms after its creation in 1980; 2) in any event, FmHA agreed to subordinate its security interest in livestock to the Bank; 3) the “Lender’s Agreement” between the Bank and FmHA authorized the Bank to release the proceeds of livestock sales to the Skeltons if such proceeds were to be used in farming operations; and 4) even if the “Lender’s Agreement” prohibited the release of sales proceeds to Skelton Farms, FmHA is estopped from complaining of these matters under the facts of this case.
FmHA contends that its agreement to subordinate its secured position should be deemed satisfied, or no longer applicable. In support of its position, FmHA argues that 1) although more than $180,000.00 was received by the Bank from the proceeds of sale of Skelton Farms’ livestock, the Bank failed to apply those proceeds to reduce the 1984 subordination agreement and the 1985 loan note guaranty; 2) the “Lender’s Agreement” required the Bank to apply all sales proceeds directly to the guaranteed loans; and 3) instead of making new loans in 1985, totaling $180,000.00 (for which FmHA guarantees were issued), the Bank used the money to renew existing debts of Skelton Farms. FmHA further contends that it had no authority to require the Skeltons to use the sales proceeds in any particular manner, and that the Bank breached its fiduciary duty of care by not fully informing FmHA that it was allowing Skelton Farms to use the sales proceeds for current operating expenses.
The Court notes the Bank's argument that FmHA obtained a perfected security interest in the livestock of Fred Skelton, but failed to obtain a security interest in the livestock of Skelton Farms. However, the Court believes that it is unnecessary to address this argument. Assuming that the perfected security interest of FmHA survived the creation of Skelton Farms, FmHA nonetheless agreed to subordinate its security interest to the Bank. The Bank, therefore, possesses a superior lien to the extent of $180,000.00. FmHA’s argument that the subordination agreement should be deemed satisfied is rejected for the following reasons:
First, according to the language in the “Lender’s Agreement,” the Bank was authorized to release sale proceeds to the Skeltons if such proceeds were to be used in farming operations. The Agreement required the Bank to assure that “proceeds from the sale ... of collateral are applied in accordance with the lien priorities on which the guarantee is based, except the proceeds from the disposition of collateral, such as machinery ... may be used to acquire property of [a] similar nature without the written concurrence of the FmHA.” (Lender’s Agreement, Ü VIII(C)(5)(d)) (emphasis added). The testimony indicated that the funds released by the Bank to the Skeltons were used to pay operating expenses and to maintain the hog herd. While the particular provision quoted above does not refer to proceeds from the sale of livestock, the provision sets forth only examples. The Agreement clearly indicates that the Bank was authorized to release proceeds from the sales of livestock to the *207Skeltons for acquisition of “property of a similar nature.”
Second, FmHA’s contention that the Bank breached its fiduciary duty of care by not fully informing FmHA that it was releasing sales proceeds to Skelton Farms is simply not supported by the facts. The Bank’s letters to FmHA on April 4, 1985 requesting loan note guarantees expressly stated that the loans involved would be “perpetual operating” loans. Applications were submitted by the Bank and the Skel-tons on FmHA forms. Loan guarantees totaling $180,000.00 were requested by the Bank. The Skeltons’ financial statements submitted in support of the applications for guaranteed loans showed an existing indebtedness to the Bank in the sum of $180,-000.00. Despite the fact that the Bank was requesting loan guarantees in an amount that equalled the Skeltons’ existing indebtedness, FmHA failed to contact the Bank to determine whether the Bank was making a new loan or refinancing a debt already owed by the Skeltons. In fact, the Bank’s letter requesting loan note guarantees is dated April 4, 1985, and conditional commitments to issue those guarantees were made April 5, 1985. Under all of these circumstances, FmHA should have been aware that the Skeltons were not using the proceeds from their farming operations to reduce the debt owed the Bank, and furthermore, should have known that the purpose of the 1985 loan was to refinance the Skeltons’ existing debt. As such, FmHA cannot now complain that the Bank breached its fiduciary duty of care.
Finally, the Court notes that while the Code of Federal Regulations, in 1985, did not expressly authorize (or prohibit) an FmHA County Supervisor to approve applications to guarantee “line of credit” lending, the Code did expressly authorize the County Supervisor to issue guarantees for loans that were used to pay annual operating expenses and family living expenses. See, 7 C.F.R. § 1980.175(c) (1985). The Code further authorized the County Supervisor to issue guarantees for loans, the proceeds of which were used to refinance debt “incurred for any authorized operating loan purpose ...” 7 C.F.R. § 1980.-175(c)(iv) (1985).
Accordingly, for the reasons stated above, the Court finds that the Bank possesses a paramount and perfected security interest in the crops and livestock of Skel-ton Farms to the extent of $180,000.00. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483442/ | Order filed November 8, 2022
In The
Fourteenth Court of Appeals
____________
NO. 14-22-00584-CV
____________
In the Interest of K.L. and C.L.
On Appeal from the 315th District Court
Harris County, Texas
Trial Court Cause No. 2020-01646J
ORDER
This is an accelerated appeal from a judgment in a suit in which the
termination of the parent-child relationship is at issue (“parental termination
case”).
The notice of appeal was filed June 28, 2022. On November 8, 2022, a
hearing was held in the trial court and the trial court signed an order finding
appellant is indigent, directing the court reporter to file the record in this appeal,
and appointing counsel on appeal.
Appeals in parental termination cases and child protection cases are to be
brought to final disposition within 180 days of the date the notice of appeal is
filed. See Tex. R. Jud. Admin. 6.2(a). In this case, that date is December 23,
2022. The trial and appellate courts are jointly responsible for ensuring that the
appellate record is timely filed. See Tex. R. App. P. 35.3(c). The trial court must
direct the court reporter to immediately commence the preparation of the reporter’s
record and must arrange for a substitute reporter, if necessary. See Tex. R. App. P.
28.4(b)(1).
Because the reporter’s record has not been filed timely in this accelerated
appeal, we issue the following order:
We order Kara Salazar, the official court reporter, to file the record in this
appeal on or before November 18, 2022. If Kara Salazar does not timely file the
record as ordered, the court may issue an order requiring her to appear at a hearing
to show cause why the record has not been timely filed.
PER CURIAM
Panel Consists of Justices Zimmerer, Spain and Hassan. | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483415/ | NUMBER 13-22-00524-CR
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
MATTHEW ANDREW ALLRED, Appellant,
v.
THE STATE OF TEXAS, Appellee.
On appeal from the 443rd District Court
of Ellis County, Texas.
MEMORANDUM OPINION
Before Justices Longoria, Hinojosa, and Silva
Memorandum Opinion by Justice Longoria
Appellant Matthew Andrew Allred attempts to appeal convictions for two counts of
aggravated sexual assault of a child. See TEX. PENAL CODE ANN. § 22.021. On March 11,
2022, the trial court imposed concurrent sentences of life imprisonment. Appellant’s
notice of appeal was filed with the district clerk on October 10, 2022, and was filed with
the Tenth Court of Appeals on October 20, 2022. The Texas Supreme Court subsequently
transferred the appeal to this Court. See TEX. GOV’T CODE ANN. § 73.001.
On November 2, 2022, the Clerk of this Court notified appellant that it appeared
that the appeal had not been not timely perfected and advised appellant that the appeal
would be dismissed if the defect was not corrected within ten days from the date of receipt
of the Court’s directive. See TEX. R. APP. P. 37.1. In response, appellant filed an amended
notice of appeal stating that appellant was convicted on March 11, 2022, the judgments
were “assessed” on September 29, 2022, and a motion for new trial was filed on October
17, 2022. Appellant subsequently filed a second amended notice of appeal reiterating this
sequence of events and stating that “[b]oth the Court File mark as well as the Presiding
Judge’s signature[s] indicate the Judgment[s were] entered on September 29, 2022.” In
this regard, the judgments bear file-stamped dates of September 29, 2022, and state near
the trial court’s signature line: “Date Judgment Entered: September 29, 2022.”
This Court’s appellate jurisdiction in a criminal case is invoked by a timely filed
notice of appeal. Guthrie-Nail v. State, 543 S.W.3d 225, 226 (Tex. Crim. App. 2018); Olivo
v. State, 918 S.W.2d 519, 522 (Tex. Crim. App. 1996). Absent a timely filed notice of
appeal, a court of appeals does not have jurisdiction to address the merits of the appeal
and can take no action other than to dismiss the appeal for want of jurisdiction. Castillo v.
State, 369 S.W.3d 196, 198 (Tex. Crim. App. 2012); Slaton v. State, 981 S.W.2d 208,
2
210 (Tex. Crim. App. 1998). “The Texas Rules of Appellate Procedure govern the
perfection of appeal.” Smith v. State, 559 S.W.3d 527, 531 (Tex. Crim. App. 2018).
Texas Rule of Appellate Procedure 26.2(a) prescribes the period of time within
which a defendant in a criminal case must file a notice of appeal in order to perfect the
appeal:
(a) By the Defendant. The notice of appeal must be filed:
(1) within 30 days after the day sentence is imposed or
suspended in open court, or after the day the trial court enters
an appealable order; or
(2) within 90 days after the day sentence is imposed or
suspended in open court if the defendant timely files a motion
for new trial.
TEX. R. APP. P. 26.2(a). Therefore, in a criminal case, the defendant must file a notice of
appeal within thirty days after the day sentence is imposed or suspended in open court,
or after the day the trial court enters an appealable order. See id. R. 26.2(a)(1). If the
defendant timely files a motion for new trial, the notice of appeal must be filed within ninety
days after the day sentence is imposed or suspended in open court. See id. R. 26.2(a)(2).
The defendant may obtain an extension of time to file the notice of appeal if, within fifteen
days after the deadline for filing the notice of appeal, the defendant files the notice of
appeal in the trial court and files a motion complying with the Texas Rules of Appellate
Procedure in the appellate court. See id. R. 26.3; see also id. R. 10.5. Thus, a late notice
of appeal may be considered timely if (1) it is filed within fifteen days of the last day
3
allowed for filing, (2) a motion for extension of time is filed in the court of appeals within
fifteen days of the last day allowed for filing the notice of appeal, and (3) the court of
appeals grants the motion for extension of time. See Olivo, 918 S.W.3d at 522.
When a defendant appeals from a conviction in a criminal case, the time to file a
notice of appeal runs from the date sentence is imposed or suspended in open court, not
from the date sentence is signed and entered by the trial court. See Rodarte v. State, 860
S.W .2d 108, 109 (Tex. Crim. App. 1993) (construing the predecessor to Rule 26.2); Lair
v. State, 321 S.W.3d 158, 159 (Tex. App.—Houston [1st Dist.] 2010, pet. ref’d); Roberts
v. State, 270 S.W.3d 662, 663 (Tex. App.—San Antonio 2008, no pet.); Modica v. State,
151 S.W.3d 716, 720 (Tex. App.—Beaumont 2004, pet. ref’d); George v. State, 883
S.W.2d 250, 251 (Tex. App.—El Paso 1994, no pet.). Otherwise, when a criminal
defendant appeals from an “appealable order,” the time to file the notice of appeal is
calendared from the date that order is entered. See Blanton v. State, 369 S.W.3d 894,
904 (Tex. Crim. App. 2012) (discussing appeals from nunc pro tunc orders); O’Conner v.
State, 266 S.W.3d 575, 577 (Tex. App.—Amarillo 2008, pet. ref’d) (explaining that the
calculation of the appellate deadlines is “context dependent” regarding whether the
appeal is calculated from the time sentence is imposed or suspended or from an
appealable order).
The Court, having examined and fully considered the documents on file and the
applicable law, is of the opinion that the notice of appeal was not timely filed, and we thus
4
lack jurisdiction over the appeal. See Slaton, 981 S.W.2d 208; Olivo, 918 S.W.2d at 522;
see also Ater v. Eighth Ct. of Apps., 802 S.W.2d 241, 242–43 (Tex. Crim. App. 1991)
(orig. proceeding) (explaining that out-of-time appeals are governed by post-conviction
writs of habeas corpus). Accordingly, we dismiss this appeal for lack of jurisdiction.
NORA L. LONGORIA
Justice
Do not publish.
TEX. R. APP. P. 47.2 (b).
Delivered and filed on the
10th day of November, 2022.
5 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483416/ | THE THIRTEENTH COURT OF APPEALS
13-22-00524-CR
Matthew Andrew Allred
v.
The State of Texas
On Appeal from the
443rd District Court of Ellis County, Texas
Trial Court Cause No. 46911CR
JUDGMENT
THE THIRTEENTH COURT OF APPEALS, having considered this cause on
appeal, concludes the appeal should be dismissed. The Court orders the appeal
DISMISSED in accordance with its opinion.
We further order this decision certified below for observance.
November 10, 2022 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483418/ | THE THIRTEENTH COURT OF APPEALS
13-18-00636-CV
JIMIE DIANNE OWSLEY
v.
BRIAN LEON OWSLEY
On Appeal from the
319th District Court of Nueces County, Texas
Trial Court Cause No. 2014-FAM-1876-G
JUDGMENT
THE THIRTEENTH COURT OF APPEALS, having considered this cause on
appeal, concludes that the judgment of the trial court should be affirmed. The Court
orders the judgment of the trial court AFFIRMED. Costs of the appeal are adjudged
against appellant.
We further order this decision certified below for observance.
November 10, 2022 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483422/ | THE THIRTEENTH COURT OF APPEALS
13-22-00167-CV
DAPENG HOLDINGS, LLC AND YI CHENG ZHENG
v.
JEFFORY DEAN BLACKARD, BLACKARD GENERAL PARTNER V, LLC
AND BLACKARD GLOBAL DEVELOPMENT II, LLC
On Appeal from the
148th District Court of Nueces County, Texas
Trial Court Cause No. 2021DCV-3875-E
JUDGMENT
THE THIRTEENTH COURT OF APPEALS, having considered this cause on
appeal, concludes the appeal should be dismissed. The Court orders the appeal
DISMISSED in accordance with its opinion. Costs of the appeal will be taxed against the
party incurring the same.
We further order this decision certified below for observance.
November 10, 2022 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483428/ | NUMBER 13-22-00532-CR
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
IN RE MICKEY WAYNE BOSWELL
On Petition for Writ of Mandamus.
MEMORANDUM OPINION
Before Chief Justice Contreras and Justices Benavides and Tijerina
Memorandum Opinion by Justice Tijerina1
On November 1, 2022, relator Mickey Wayne Boswell filed a pro se petition for writ
of mandamus seeking to compel the trial court to vacate a judgment nunc pro tunc signed
on March 2, 2011, in trial court cause number 09-CR-1082-G in the 319th District Court
of Nueces County, Texas. Relator contends that the judgment nunc pro tunc is illegal and
1 See TEX. R. APP. P. 52.8(d) (“When denying relief, the court may hand down an opinion but is not
required to do so. When granting relief, the court must hand down an opinion as in any other case.”); id. R.
47.4 (distinguishing opinions and memorandum opinions).
violates his due process rights.2 Relator has previously filed a direct appeal from this
same trial court cause number. See Boswell v. State, Nos. 13-11-00785-CR, 13-11-
00786-CR, & 13-11-00791-CR, 2015 WL 5655823, at *1 (Tex. App.—Corpus Christi–
Edinburg Sept. 24, 2015, pet. ref’d) (mem. op., not designated for publication).
In a criminal case, to be entitled to mandamus relief, the relator must establish
both that the act sought to be compelled is a ministerial act not involving a discretionary
or judicial decision and that there is no adequate remedy at law to redress the alleged
harm. See In re Meza, 611 S.W.3d 383, 388 (Tex. Crim. App. 2020) (orig. proceeding);
In re Harris, 491 S.W.3d 332, 334 (Tex. Crim. App. 2016) (orig. proceeding) (per curiam);
In re McCann, 422 S.W.3d 701, 704 (Tex. Crim. App. 2013) (orig. proceeding). If the
relator fails to meet both requirements, then the petition for writ of mandamus should be
denied. State ex rel. Young v. Sixth Jud. Dist. Ct. of Apps. at Texarkana, 236 S.W.3d 207,
210 (Tex. Crim. App. 2007) (orig. proceeding).
It is the relator’s burden to properly request and show entitlement to mandamus
relief. See State ex rel. Young, 236 S.W.3d at 210; In re Pena, 619 S.W.3d 837, 839 (Tex.
App.—Houston [14th Dist.] 2021, orig. proceeding); see also Barnes v. State, 832 S.W.2d
424, 426 (Tex. App.—Houston [1st Dist.] 1992, orig. proceeding) (per curiam) (“Even a
pro se applicant for a writ of mandamus must show himself entitled to the extraordinary
relief he seeks.”). In addition to other requirements, the relator must include a statement
2 To the extent that relator’s petition for writ of mandamus could be construed as an application for
writ of habeas corpus, we note that the intermediate appellate courts lack jurisdiction to grant writs of
habeas corpus in criminal cases. See TEX. GOV’T CODE ANN. § 22.221(d); Ex parte Braswell, 630 S.W.3d
600, 601–02 (Tex. App.—Waco 2021, orig. proceeding); In re Quinata, 538 S.W.3d 120, 120–21 (Tex.
App.—El Paso 2017, orig. proceeding); In re Ayers, 515 S.W.3d 356, 356–57 (Tex. App.—Houston [14th
Dist.] 2016, orig. proceeding) (per curiam).
2
of facts and a clear and concise argument for the contentions made, with appropriate
citations to authorities and to the appendix or record. See generally TEX. R. APP. P. 52.3
(governing the form and contents for a petition). Further, the relator must file an appendix
and record sufficient to support the claim for mandamus relief. See id. R. 52.3(k)
(specifying the required contents for the appendix); R. 52.7(a) (specifying the required
contents for the record).
The Court, having examined and fully considered the petition for writ of mandamus
and the applicable law, is of the opinion that relator has not met his burden to obtain
mandamus relief. Therefore, we deny the petition for writ of mandamus. See TEX. R. APP.
P. 52.8(a), (d).
JAIME TIJERINA
Justice
Do not publish.
TEX. R. APP. P. 47.2 (b).
Delivered and filed on the
7th day of November, 2022.
3 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483417/ | NUMBER 13-18-00636-CV
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
JIMIE DIANNE OWSLEY, Appellant,
v.
BRIAN LEON OWSLEY, Appellee.
On appeal from the 319th District Court
of Nueces County, Texas.
MEMORANDUM OPINION
Before Chief Justice Contreras and Justices Longoria and Tijerina
Memorandum Opinion by Justice Tijerina
Appellant Jimie Dianne Owsley challenges the trial court’s judgment granting
appellee Brian Leon Owsley’s motion to enforce a final decree of divorce. By seven
issues, appellant contends that: (1) the trial court “improperly modified the Decree of
Divorce”; (2) the trial court improperly found that she did not refinance a mortgage on
community property within sixty days; (3) the trial court improperly enforced the divorce
decree by contempt; (4) the trial court abused its discretion in a myriad manner; (5) the
trial court abused its discretion by awarding attorney’s fees to appellee; (6) “[t]he provision
in the Divorce Decree relating to the title to the two vehicles is not sufficiently specific to
support a finding of contempt”; and (7) “[t]he [t]rial [c]ourt abused its discretion by setting
a supersedeas bond at $250,000, in violation of the standards of” the Texas Rules of
Appellate Procedure and the Texas Civil Practice and Remedies Code. We affirm.
I. PERTINENT FACTS
The parties were divorced in 2016. In 2018, appellee filed a motion to enforce the
divorce decree. The trial court granted that motion after a hearing. In its enforcement
order, the trial court found that appellant had failed to comply with a multitude of provisions
of the divorce decree, including failing to (1) refinance the mortgage on a house the couple
owned in Las Vegas in her sole name within sixty days of the divorce decree, (2) provide
appellee with title to two vehicles which were in her name and were awarded to appellee
in the divorce decree, and (3) pay attorney’s fees to appellee.
The trial court ordered that the Las Vegas property “be listed for immediate sale,
and sold”; that appellant pay appellee attorney’s fees; that appellant provide appellee
valid titles to each of the vehicles awarded to him in the divorce decree but registered in
her name; and that appellant pay a supersedeas bond in the amount of $250,000. The
trial court also made several orders relating to the sale of the Las Vegas property and
held appellant in contempt of court. Appellant then appealed the judgment on November
16, 2018.
Subsequently, on March 1, 2019, appellant filed a suggestion of bankruptcy in our
2
Court. See TEX. R. APP. P. 8.1. We therefore abated this appeal pending the filing of a
motion to reinstate. See id. 8.3(8). On December 14, 2020, appellant filed a motion to
reinstate this appeal stating that the bankruptcy court had confirmed the bankruptcy plan.
We granted the motion and reinstated the appeal on December 23, 2020.
II. APPELLANT’S FIRST ISSUE
By her first issue, appellant contends that the trial court “improperly modified the
Decree of Divorce, which is prohibited by Tex. Fam. Code §§ 9.006(b) and 9.007(a) &
(b).” Specifically, by three sub-issues, appellant claims that the trial court “impermissibly
modified” the divorce decree in three areas.
In her first sub-issue, appellant states that the trial court held her “in contempt of
court and sets her punishment at three days in jail,” but ordered that “she can avoid
incarceration if she provides [appellee] with valid Texas Certificates of Title for both
vehicles free of liens.” Appellant claims that holding her in contempt of court is a deviation
from the divorce decree and impermissibly altered the divorce decree, which she claims
merely required that she provide title to the vehicles if “available.”
To the extent she is complaining about the contempt order itself, as pointed out by
appellee, generally, an order of contempt is not appealable. See In re Office of Atty. Gen.
of Tex., 215 S.W.3d 913, 916 (Tex. App.—Fort Worth 2007, no pet.) (“A contempt
judgment may be attacked by a petition for writ of habeas corpus (if the contemnor is
confined) or a petition for writ of mandamus (if no confinement is involved); however,
because a contempt order is not a final judgment, a remedy by appeal does not lie.”)
(Internal citation omitted). Appellant does not argue on appeal that an exception to the
general rule applies to the facts here. And, in her reply brief states that she is not
3
appealing the contempt order. Nonetheless, we conclude that appellant’s complaint that
holding her in contempt for not producing the titles to the vehicles is paramount to
deviating from the divorce decree, is a challenge to the contempt order itself, and thus
not an appealable complaint. See id.
Next, by her second sub-issue, appellant complains that although appellee
admitted “that he refused to sign paperwork to allow the refinancing [of the couple’s Las
Vegas property] to go forward and without evidence that the mortgage cannot be
refinanced in [appellant’s] sole name,” “[t]he order being appealed orders that the
[couple’s Las Vegas] property be sold and gives [appellee] the exclusive authority to”
perform several tasks related to the sale including, among other things, “obtain[ing] a
competitive market analysis of the value of the house, select[ing] a listing agent or broker,
and sell[ing] the house at any price at or above 90% of the price indicated in the market
analysis.” According to appellant, the sale of the Las Vegas property was thus “converted
from a conditional event stated in the Decree to a mandatory requirement in the Order,
without regard to whether the condition for sale contained in the Decree had been met.”
We disagree with appellant to the extent that she argues that there is no evidence
that she could not refinance the Las Vegas loan in her own name —and therefore, the
trial court modified the decree by ordering the property to be sold—we note that the trial
court heard evidence that appellant did not refinance the loan within sixty days of the
judgment, a fact she does not challenge on appeal. Appellant claims that appellee
prevented her from refinancing the loan, but the evidence supports the trial court’s implied
finding that appellee did not do that.
By her third sub-issue to her first issue, appellant states: “[She] was enjoined from
4
interfering with the sale of the property,” the “injunction was not contained in the Divorce
Decree, and there were no pleadings or evidence to support the issuance of an injunction
under TEX. R. CIV. P. 683.” Appellant instructs the Court to “See Issue No. 4(9) below.”
As pointed out by appellee, and not disputed by appellant, the Las Vegas property
was sold. Accordingly, a controversy no longer exists regarding appellant’s above-
mentioned complaints. “If a controversy ceases to exist—the issues presented are no
longer ‘live’ or the parties lack a legally cognizable interest in the outcome—the case
becomes moot.” Williams v. Lara, 52 S.W.3d 171, 184 (Tex. 2001). When an appellate
court’s judgment cannot have any practical legal effect upon a previous existing
controversy, the case is also moot. Zipp v. Wuemling, 218 S.W.3d 71, 73 (Tex. 2007)
(“An appeal is moot when a court’s action on the merits cannot affect the rights of the
parties.”). Appellant has failed to establish that the appeal concerning these complaints
about the Las Vegas property is still ripe. Therefore, we conclude that these complaints
concerning the sale of the home are moot.
Having found no merit in appellant’s first issue and sub-issues, we overrule them.
III. APPELLANT’S SECOND ISSUE
By her second issue, appellant contends that the Las Vegas property was awarded
to her solely in the divorce decree; however, “[t]he order being appealed says, ‘pursuant
to the enumerated provisions of the parties’ Final Decree of Divorce signed on February
19, 2016, [the Las Vegas property was] ordered sold, and the proceeds divided.’”
Appellant argues that the trial court erred in this regard because “only if the mortgage on
the property could not be refinanced in [her] sole name [would] the [Las Vegas]
property . . . be sold and the proceeds divided.” This argument appears to be a
5
restatement of appellant’s second sub-issue to her first issue and additionally appears to
challenge the sufficiency of the evidence supporting the trial court’s implied finding that
the mortgage was not refinanced in her sole name within sixty days.
As we understand it, appellant complains that there is no evidence that she
satisfied the “condition” set forth in the divorce decree. Appellant relies on evidence she
claims shows that the reason for her inability to refinance the mortgage under her name
was due to appellee’s refusal to sign the paperwork. Appellant provides one citation to an
evidentiary hearing in her argument section wherein appellee stated that he refused to
sign the closing documents for refinancing the Las Vegas property. However, appellee
also then explained that he refused to sign the paperwork because, at that point, he “had
[a trial court] order indicating that he had the right to sell” because appellant had failed to
refinance the home within the sixty-day period as ordered by the trial court.
As previously pointed out, appellant admits that, according to the divorce decree,
if she were unable to refinance the mortgage in her sole name within sixty days of the
decree, “the [Las Vegas] house would be sold and the proceeds divided.” There is
evidence in the record that appellant failed to refinance the mortgage in her sole name in
the allotted time as set out in the divorce decree. We conclude that based on the record
before us, the “condition” set forth the in the divorce decree to trigger the obligation to sell
the property was satisfied. Accordingly, we overrule appellant’s second issue.
IV. APPELLANT’S THIRD ISSUE
By her third issue, appellant again complains about the order compelling the sale
of the Las Vegas property. Appellant argues that the trial court erred pursuant to Texas
Family Code § 9.008(d) because the trial court failed to “provide a reasonable time for
6
compliance before enforcing a clarifying order by contempt or in another manner.”
Specifically, appellant argues that “the Trial Court ordered the [Las Vegas] property sold
without allowing [her] a reasonable time after the Order to refinance the house in her sole
name.” Appellant, baldly states that it was “error” for the trial court to order “a sale of the
[Las Vegas] house at [appellee’s] discretion, giving [him] exclusive control over all
decisions relating to the marketing and sale of the property and prohibiting [appellant]
from interfering.”
The divorce decree stated that the house must be sold if appellant did not refinance
it in her name within sixty days, and that order is final. Therefore, the trial court was within
its authority to enforce the divorce decree by ordering the sale of the property. We
overrule appellant’s third issue.
V. APPELLANT’S FOURTH ISSUE
By her fourth issue, appellant complains that it was an abuse of the trial court’s
discretion to:
(1) give Brian Owsley exclusive control over securing a market analysis of
the Las Vegas property;
(2) give Brian the exclusive power to select the broker or agent to list the
property at a price set by Brian;
(3) provide that the house awarded in the divorce to Jimie would be sold for
a price that is 90% or more of the price suggested in the market analysis;
(4) provide for Brian to get a new market analysis if the house was unsold
at the end of six months, giving Brian the exclusive power to relist the
property at a price set by Brian;
(5) give Brian the right, if the house had not sold within 12 months, to
request a show cause and trigger a conference with the Judge to determine
if additional orders should be issued, after plenary power has expired, while
giving Jimie no such right;
7
(6) require Jimie to pay half of “lender required repairs,” with no specification
of who the lender is or that the repairs be necessary and the cost
reasonable, and to require that the cost must be advanced within 72 hours
of the request for such repairs;
(7) require Jimie to sign “all documents required by the listing broker, listing
agent, and/or title company” within 72 hours of presentment, obligating her
to sign documents that have not yet been drafted, and that could contain
terms that are not reasonable or terms to which she does not agree;
(8) award half of the proceeds from sale of the property to Brian; and
(9) issue an injunction prohibiting Jimie “from interfering with the ordered
sale . . . as provided by these orders,” without sufficient pleadings and proof
to support the injunction, and where the injunction is overly vague.[1]
A. Right to Control2
First, by a sub-issue to her fourth issue, citing Elliott v. Elliott, appellant states that
although the trial court is vested with broad powers and discretion to divide the marital
estate and to make decisions regarding the adjustment of equities between the parties,
this discretion “may enlist the aid of a trustee, receiver[,] or a commissioner to effectuate
the terms and provisions of [a] judgment.” 422 S.W.2d 757, 758 (Tex. Civ. App.—Fort
Worth 1967, writ dism’d w.o.j.). Appellant then states:
Note that the court in Elliott did not suggest the appointment of one spouse
to dispose of property belonging partly to the opposing spouse. Despite
Brian’s inherent conflict of interest and demonstrable hostility toward Jimie,
the Trial Court gave Brian the authority of a receiver without the safeguards
of receivership. For example, a receiver is required to post a bond but Brian
is not required to post a bond. TEX. CIV. PRAC. & REM. CODE § 64.023. But
Brian operates without a bond and without court supervision and Jimie is
enjoined from taking any action that would interfere with Brian’s exercise of
power. This arrangement was an abuse of discretion.
1 Although appellant makes this list of complaints, she only provides purported argument
concerning the complaints we address below in sections VI. A-E.
2 We use the same titles that appellant uses in her brief to label the subsections to section VI.
8
As previously stated, the property has been sold, and any issues concerning it are now
moot. We overrule appellant’s first sub-issue to her fourth issue.
B. Expiration of Plenary Power
By her second sub-issue to her fourth issue, appellant complains that the trial court
acted outside its plenary power when it ordered that appellee “could issue a show cause
or trigger a status conference after the Trial Court [lost] plenary power” if the Las Vegas
property did not sell within twelve months of the first market analysis.
Appellant cites authority establishing that a trial court’s plenary power generally
expires, and the court loses jurisdiction, thirty days after the judgment is signed. See TEX.
R. CIV. P. 329b(d). However, notwithstanding this authority, a court that rendered a
divorce decree “retains the power to enforce the property division” set forth in the decree.
TEX. FAM. CODE ANN. § 9.002. Thus, the trial court had authority to enforce the property
division. See id. We overrule her second sub-issue to her fourth issue.
C. Requirement to Make and Pay for Repairs Required by Third Persons
By her third sub-issue to her fourth issue, appellant states that “Inherently, a court
may not require a party to pay future bills without limit and without recourse to the courts”
and it cannot “order the payment of claims without the requirement that they be
reasonable and necessary.” Specifically, appellant complains of the court’s order that she
“must advance half of ‘Lender required repairs.’” Appellant notes that the order does not
identify the “lender,” and complains that it does not state that any required repairs must
be reasonable and necessary. Appellant cites authority establishing that “[a] party seeking
to recover remedial damages must prove that the damages sought are reasonable and
9
necessary.”3 However, as the Las Vegas property has been sold, we conclude that this
issue is moot.
Furthermore, the case cited by appellant applies to a breach of construction
contract claim, which is not the issue here. See McGinty v. Hennen, 372 S.W.3d 625, 627
(Tex. 2012) (per curiam) (explaining that the measure of damages in a breach of
construction contract claim are remedial damages and difference-in-value damages and
stating that “[a] party seeking to recover remedial damages must prove that the damages
sought are reasonable and necessary”). Instead, here, the trial court issued an
enforcement order of a divorce decree, and appellant cites and we find no authority
prohibiting the trial court from doing so. Therefore, we conclude that in this case, remedial
damages are not applicable. See id. We overrule appellant’s third sub-issue to her fourth
issue.
D. Requirement to Sign All Documents Prepared by Third Persons
By a fourth sub-issue to her fourth issue, appellant complains as follows:
For similar reasons, a court cannot order a party to execute documents not
yet created, without regard to what the documents may say, and without
judicial recourse. No cases were found that review such an order. However,
it follows from the doctrine of ripeness that a court cannot adjudicate future
disputes that have not yet arisen. “A case is not ripe when its resolution
depends on contingent or hypothetical facts, or upon events that have not
yet come to pass.” Patterson v. Planned Parenthood, 971 S.W.2d 439, 443
(Tex. 1998). Courts do not have the power to adjudicate issues before they
arise.
This is the extent of the briefing regarding this sub-issue. Accordingly, we overrule
appellant’s fourth sub-issue to her fourth issue as inadequately briefed. See id.
3 Specifically, appellant cites McGinty v. Hennen, 372 S.W.3d 625, 627 (Tex. 2012) (per curiam).
10
E. The Injunction
By her fifth sub-issue to her fourth issue, appellant contends that “a judgment
cannot stand unless it is supported by both pleadings and evidence”; “there was no
evidence offered to support a permanent injunction”; “there is no evidence of a wrongful
act, or imminent harm or irreparable injury, or absence of an adequate remedy at law”;
and “this injunction is so vague that it constitutes [an] abuse of discretion.” Appellant then
states: “Because of insufficient pleadings, lack of supporting evidence, and vagueness,
the injunction should be dissolved.”
Appellee responds that the Las Vegas property was placed under the bankruptcy
court’s review, and she was ordered to sell it as part of her bankruptcy plan. Thus,
according to appellee, the issue of the injunction is moot. We agree with appellee and
therefore overrule this issue as further discussed below.
1. Applicable Law
“[C]ourts have an obligation to take into account intervening events that may
render a lawsuit moot.” Heckman v. Williamson County, 369 S.W.3d 137, 166–67 (Tex.
2012). We lack jurisdiction to decide moot controversies and to render advisory opinions.
See Nat’l Collegiate Athletic Ass’n v. Jones, 1 S.W.3d 83, 86 (Tex. 1999). “And we have
the power, ‘on affidavit or otherwise,’ to ‘ascertain the matters of fact that are necessary
to the proper exercise of [our] jurisdiction,’ even if evidence establishing those facts is not
in the trial court’s record. State ex rel. Best v. Harper, 562 S.W.3d 1, 7 (Tex. 2018); see
TEX. GOV’T CODE ANN. § 22.220 (“Each court of appeals may, on affidavit or otherwise, as
the court may determine, ascertain the matters of fact that are necessary to the proper
exercise of its jurisdiction.”); see also Glass v. Sponsel, 916 S.W.2d 25, 26 (Tex. App.—
11
Houston [1st Dist.] 1995, writ dism’d).
A case is not moot if a justiciable controversy between the parties exists at every
stage of the legal proceedings, including the appeal. Williams v. Lara, 52 S.W.3d 171,
184 (Tex. 2001). “If a controversy ceases to exist—the issues presented are no longer
‘live’ or the parties lack a legally cognizable interest in the outcome—the case becomes
moot.” Id. When an appellate court’s judgment cannot have any practical legal effect upon
a previous existing controversy, the case is also moot. Zipp v. Wuemling, 218 S.W.3d 71,
73 (Tex. 2007) (“An appeal is moot when a court’s action on the merits cannot affect the
rights of the parties.”).
2. Analysis
Here, even if we reverse the complained-of order regarding the injunction, the
bankruptcy court ordered the sale of the Las Vegas property, which is the subject of the
injunction, and pursuant to the bankruptcy court’s order, the Las Vegas property was sold.
Thus, the relief appellant requests from us would have no practical legal effect on the
appellant’s rights in the sale of the Las Vegas property. See id.4 We overrule this sub-
issue as moot.
VI. APPELLANT’S FIFTH ISSUE
By her fifth issue, appellant complains of the trial court’s order compelling her to
4 We note that appellee has provided the Court with a copy of an agreed order conditioning an
automatic stay regarding the Las Vegas property, wherein the bankruptcy court documented that appellant
and appellee signed an agreement which was accepted and approved by the bankruptcy court to sell the
Las Vegas property. “And we have the power, ‘on affidavit or otherwise,’ to ‘ascertain the matters of fact
that are necessary to the proper exercise of [our] jurisdiction,’ even if evidence establishing those facts is
not in the trial court’s record.” State ex rel. Best v. Harper, 562 S.W.3d 1, 7 (Tex. 2018); see TEX. GOV’T
CODE ANN. § 22.220 (“Each court of appeals may, on affidavit or otherwise, as the court may determine,
ascertain the matters of fact that are necessary to the proper exercise of its jurisdiction.”); see also Glass
v. Sponsel, 916 S.W.2d 25, 26 (Tex. App.—Houston [1st Dist.] 1995, writ dism’d).
12
pay attorney’s fees to appellee. As previously set out above, appellant filed for bankruptcy
during the pendency of this appeal, and the bankruptcy court ordered her to pay the
amount of attorney’s fees as found she owed by the trial court in this appeal. Thus,
appellee argues that the bankruptcy court’s order renders this appeal regarding attorney’s
fees moot. Appellant responds that the bankruptcy court’s judgment ordering her to pay
attorney’s fees is not moot because attorney’s fees are not dischargeable in bankruptcy
court.5
A case “is not rendered moot simply because some of the issues become moot
during the appellate process.” In re Kellogg Brown & Root, Inc., 166 S.W.3d 732, 737
(Tex. 2005) (orig. proceeding). A case remains “live” to claims or issues that are not moot
even if some claims or issues become moot. See id.
Nonetheless, the bankruptcy court has ordered appellant to pay the attorney’s fees
awarded in the appealed-from judgment in this case, and that order is final. Thus, even if
we were to determine that the trial court in this appeal erroneously awarded those fees to
appellee, appellant must still pay those attorney’s fees pursuant to the bankruptcy court’s
final order as she did not appeal it.6 Accordingly, our ruling in this matter cannot have any
practical legal effect upon the previous existing controversy between appellant and
appellee concerning attorney’s fees. 7 See Zipp, 218 S.W.3d at 73. Therefore, we
5 We note that appellant cites no authority, and we find none, supporting this argument.
6
This Court has no jurisdiction to correct error occurring in bankruptcy court. See In re C.C., 02-
17-00058-CV, 2017 WL 4819407, at *2 (Tex. App.—Fort Worth Oct. 26, 2017, no pet.) (explaining that if
the bankruptcy court erred, we have no jurisdiction to review that error). The bankruptcy order confirmed
appellant’s plan that she would pay appellee’s attorney’s fees.
7
We note that the bankruptcy court found that appellee was a creditor and confirmed the parties’
agreement that appellant pay him $53,000.
13
conclude that appellant’s issue regarding the award of attorney’s fees is moot. We
overrule appellant’s fifth issue.
VII. APPELLANT’S SIXTH ISSUE
By her sixth issue, appellant contends that the divorce decree’s provision relating
to two vehicles awarded to appellee “is not sufficiently specific to support a finding of
contempt.” Again, a direct appeal is not usually the procedural vehicle to challenge an
order of contempt, and appellant neither cites legal authority nor argues that an exception
to that general rule exists allowing her to challenge the trial court’s contempt order in this
direct appeal. See In re Office of Atty. Gen. of Tex., 215 S.W.3d at 916. Accordingly, we
overrule her sixth issue.8
VIII. APPELLANT’S SEVENTH ISSUE
By her seventh issue, appellant contends that the trial court “abused its discretion
by setting a supersedeas bond at $250,000, in violation of the standards of Tex. R. App.
P. 24.2 and Tex. Civ. Prac. & Rem. Code § 52.006(a).” Specifically, appellant argues that
this amount is arbitrary and was “suggested” by appellee “without explanation.” Appellant
argues as follows:
8 Appellant recognizes in her brief that “ordinarily” there is no appeal from a contempt order. She
argues nonetheless as follows:
However, Jimie is not appealing her confinement. She is appealing the Trial Court’s use of
a contempt finding to impose a jail sentence that was used to coerce her to obey an order
that the Trial Court had no power to issue. The finding of contempt is against the evidence,
the confinement to jail was unconstitutional, and both should be reversed and disallowed
as a basis for the Trial Court to try to accomplish what it was prohibited from doing—that
is, modifying the property division in a post-divorce clarification and enforcement
proceeding.
Appellant cites no supporting authority and does not present legal argument to support these bald
assertions. Accordingly, these assertions are inadequately briefed. See TEX. R. APP. P. 38.1(i).
14
Tex. R. App. P. 24.2 provides that for a judgment for the recovery of property
the bond should be set at least at the value of the rent or revenue of the
property. But for a money judgment, the supersedeas bond requirement
applies only to compensatory damages, interest, and costs. Tex. Civ. Prac.
& Rem. Code § 52.006(a). Under the Order being appealed from, there
were no damages or interest. Only costs were assessed against Jimie.
Under either standard, the setting of the bond at $250,000 was an abuse of
discretion.
The complained-of order awarded appellee compensatory damages. See TEX. R.
APP. P. 24.2(a)(2). The rule states that the amount of security must be “at least” the
property’s value but it does not, explicitly or implicitly, restrict the trial court from ordering
security in excess of that amount. Instead, the trial court has the general discretion to
“make any order necessary to adequately protect the judgment creditor against loss or
damage that the appeal might cause.” TEX. R. APP. P. 24.1(e). Here, the trial court used
its discretion when it set the bond, and appellant has failed to establish on appeal that it
abused that discretion. We overrule appellant’s seventh issue.
IX. CONCLUSION
We affirm the trial court’s judgment.9
JAIME TIJERINA
Justice
Delivered and filed on the
10th day of November, 2022.
9 All pending motions, if any, are denied.
15 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483419/ | NUMBER 13-22-00400-CV
COURT OF APPEALS
THIRTEENTH DISTRICT OF TEXAS
CORPUS CHRISTI – EDINBURG
HOMER JASSO, Appellant,
v.
ELESVIA “ELLIE” TORRES, AND THE
ELLIE TORRES CAMPAIGN, Appellees.
On appeal from the 464th District Court
of Hidalgo County, Texas.
MEMORANDUM OPINION
Before Chief Justice Contreras and Justices Benavides and Tijerina
Memorandum Opinion by Justice Tijerina
This cause is before the Court on appellees Elesvia “Ellie” Torres, and the Ellie
Torres Campaign’s motion to dismiss the appeal on grounds that the order being
appealed is interlocutory and did not dispose of all claims. Appellant Homer Jasso has
also filed a motion to dismiss agreeing with appellee that we lack jurisdiction.
Appellant attempted to perfect an appeal from an order signed on August 3, 2022,
granting appellee’s Rule 91a motion to dismiss and motion to dismiss pursuant to the
Texas Citizen Participation Act (TCPA). In its order, the trial court stated that although
appellee’s motions to dismiss are granted, appellee’s “claims for fees and costs under the
above motions are being held until the conclusion of this case.”
Generally, appeals may be taken only from final judgments. In re Guardianship of
Jones, 629 S.W.3d 921, 924 (Tex. 2021); Lehmann v. Har-Con Corp., 39 S.W.3d 191,
195 (Tex. 2001). Where, as here, a judgment is rendered without a conventional trial on
the merits, the judgment “is not final unless (1) it actually disposes of every pending claim
and party or (2) it clearly and unequivocally states that it finally disposes of all claims and
parties.” Jones, 629 S.W.3d at 924; Lehmann, 39 S.W.3d at 200, 205.
Here, the trial court’s order states that appellees’ claims for fees and costs are still
pending, and it does not “clearly and unequivocally” state “that it finally disposes of all
claims and parties.” Thus, it is not final for purposes of appeal. Jones, 629 S.W.3d at 924;
see also Carroll v. Metro Off. Equip., Inc., No. 02-22-00087-CV, 2022 WL 1682156, at *2
(Tex. App.—Fort Worth May 26, 2022, no pet.) (mem. op.) (holding that Rule 91a
dismissal order was not final because order awarded fees and costs “in the amount of
______” with no amount specified); Cyphers v. Children's All. of S. Tex., No. 04-21-
00225-CV, 2021 WL 3516688, at *1 (Tex. App.—San Antonio Aug. 11, 2021, no pet.) (per
curiam) (mem. op.) (concluding that trial court’s grant of motion to dismiss pursuant to the
TCPA was interlocutory because it “expressly state[d] it ha[d] not yet determined the court
costs and reasonable attorney’s fees and expenses that it must award to the
2
defendants”).
Accordingly, upon review of the documents before the Court, it appears that the
order from which this appeal was taken is not a final, appealable order. The order being
appealed is neither a final judgment nor an interlocutory appeal authorized by statute.
See Lehmann, 39 S.W.3d at 195. The Court, having considered the record, appellees’
motion to dismiss, and appellant’s motion to dismiss, is of the opinion that the appeal
should be dismissed for want of jurisdiction. See id. We grant the motions to dismiss and
dismiss this appeal. See TEX. R. APP. P. 43.2(f). Having dismissed the appeal at the
parties’ request, no motion for rehearing will be entertained.
JAIME TIJERINA
Justice
Delivered and filed on the
10th day of November, 2022.
3 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483569/ | In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 22-8016
PRESTON BENNETT,
Plaintiff-Petitioner,
v.
THOMAS DART, Sheriff of Cook County, and COOK COUNTY,
ILLINOIS,
Defendants-Respondents.
____________________
Petition for leave to appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 18-cv-04268 — John Robert Blakey, Judge.
____________________
SUBMITTED OCTOBER 20, 2022 — DECIDED NOVEMBER 14, 2022
____________________
Before EASTERBROOK, ROVNER, and WOOD, Circuit Judges.
PER CURIAM. Preston Bennett contends that Division 10 of
Cook County Jail does not satisfy the Americans with Disabil-
ities Act, 42 U.S.C. §§ 12131–34, and the Rehabilitation Act, 29
U.S.C. §794, because it lacks the grab bars and other fixtures
that disabled inmates may need in order to use showers and
toilets safely. When seeking certification of a class action,
2 No. 22-8016
Bennett tried to simplify the case by relying on a regulation
providing that “as of March 7, 1988 … construction[] or alter-
ation of buildings” must comply with the Uniform Federal
Accessibility Standards (UFAS or the Standards). 28 C.F.R.
§42.522(b)(1). The Standards require accessible toilets to have
grab bars nearby, UFAS §4.17.6, and accessible showers to
have mounted seats, UFAS §4.21.3. Division 10 was con-
structed in 1992 and so, Bennett insists, must comply with
these standards.
The district court declined to certify the requested class,
ruling that to do so would entail a premature adjudication of
the merits, which the judge equated to one-way intervention.
We reversed, 953 F.3d 467 (7th Cir. 2020), holding that class
certification would not entail resolution of the merits. Because
a class may lose as well as win, all certification could do
would be to tee up the merits for decision. We remarked:
“Bennett … proposes a class that will win if the Standards ap-
ply (and were violated, to detainees’ detriment) and other-
wise will lose. That’s how class actions should proceed.” 953
F.3d at 469.
On remand the district court certified a class. Although the
class as certified presents what appears to be a straightfor-
ward question about whether Division 10 complies with the
Standards, the case languished in the district court. Then, in
September 2022, more than two and a half years after our de-
cision, the judge decertified the class. 2022 U.S. Dist. LEXIS
171473 (N.D. Ill. Sept. 22, 2022). The judge’s principal reason
is that some class members, although using aids such as
wheelchairs, may not be disabled within the meaning of the
federal statutes—either because they are malingering or be-
cause they can get around without assistance for short
No. 22-8016 3
distances. Differences among class members would make the
case too complex, the judge stated. Plaintiffs have requested a
second interlocutory review under Fed. R. Civ. P. 23(f). Once
again we grant the petition and reverse.
The district judge did not mention Fed. R. Civ. P. 23(c)(4),
which provides: “When appropriate, an action may be
brought or maintained as a class action with respect to partic-
ular issues.” Our decision in 2020 identified such an issue, one
relevant to every detainee in Division 10. A class certified un-
der Rule 23(c)(4) resolves the issue, not the whole case. Class
members would receive the benefit of a declaratory judgment
(if the class prevails) on the issue but would need to proceed
in individual suits to seek damages; by contrast, if the class
loses, every detainee would be bound through the doctrine of
issue preclusion. We do not see—and the district judge did
not explain—why application of the Standards cannot be de-
termined class-wide, while leaving to the future any particu-
lar inmate’s claim to other relief.
This case is more than four years old. It should be resolved
with dispatch on remand. The petition for leave to appeal is
granted, and the class-decertification order is reversed. | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483568/ | RECOMMENDED FOR PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 22a0238p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
┐
JOSEPH REHO, III,
│
Petitioner-Appellant, │
> No. 22-3784
│
v. │
│
UNITED STATES OF AMERICA, │
Respondent-Appellee. │
┘
Appeal from the United States District Court for the Northern District of Ohio at Cleveland.
Nos. 1:20-cr-00775-1; 1:22-cv-00454—Patricia A. Gaughan, Chief District Judge.
Decided and Filed: November 14, 2022
Before: BOGGS, THAPAR, and READLER, Circuit Judges.
_________________
LITIGANT
ON PLEADINGS: Joseph Reho, III, Petersburg, Virginia, pro se.
_________________
ORDER
_________________
On September 13, 2022, eighty-three days after the district court entered judgment
denying his 28 U.S.C. § 2255 motion, Joseph Reho, proceeding pro se, moved for an extension
of time to apply for a certificate of appealability and to proceed in forma pauperis on appeal. If
Reho’s motion was a notice of appeal, it was three weeks late, and we must dismiss for lack of
jurisdiction. See 28 U.S.C. § 2107(b)(1); Fed. R. App. P. 4(a)(1)(B)(i). But Reho’s motion,
which repeatedly asks for an extension of time, is better construed as a motion for extension of
No. 22-3784 Reho v. United States Page 2
time to file a notice of appeal. See 28 U.S.C. § 2107(c); Fed. R. App. P. 4(a)(5)(A).
Accordingly, we remand for the district court to consider whether to grant Reho’s motion.
Generally, a section 2255 petitioner who wishes to appeal must file a notice of appeal
within sixty days after entry of judgment. 28 U.S.C. § 2107(b)(1); Fed. R. App. P. 4(a)(1)(B)(i).
Compliance with this deadline is a mandatory jurisdictional prerequisite, which means that we
lack jurisdiction to consider late appeals and cannot waive the deadline. Ultimate Appliance CC
v. Kirby Co., 601 F.3d 414, 415–16 (6th Cir. 2010). But the district court may extend the time to
file a notice of appeal based on “excusable neglect or good cause” if the losing party moves for
an extension within thirty days of the expiration of the time to file a notice of appeal. 28 U.S.C.
§ 2107(c); Fed. R. App. P. 4(a)(5)(A). The district court may also reopen the time to file a notice
of appeal if the losing party did not receive proper notice of the judgment. 28 U.S.C. § 2107(c);
Fed. R. App. P. 4(a)(6).
This court construes pro se habeas petitions liberally. Franklin v. Rose, 765 F.2d 82, 84–
85 (6th Cir. 1985) (per curiam). For instance, we regularly construe notices of appeal as
applications for a certificate of appealability. See, e.g., Johnson v. Bell, 605 F.3d 333, 336 (6th
Cir. 2010). We have also construed motions for extension of time as notices of appeal. See Isert
v. Ford Motor Co., 461 F.3d 756, 762 (6th Cir. 2006). While we have refused to construe simple
notices of appeal as motions to extend or motions to reopen, Pryor v. Marshall, 711 F.2d 63, 65
(6th Cir. 1983); Martin v. Sullivan, 876 F.3d 235, 237 (6th Cir. 2017), we have treated notices of
appeal that could reasonably be interpreted as motions for extension or to reopen as motions for
extension or to reopen. Young v. Kenney, 949 F.3d 996, 997 (6th Cir. 2020).
Here, the issue is whether Reho’s September 13, 2022, motion is best construed as a
notice of appeal or as a motion for extension of time to file a notice of appeal. Construing
Reho’s filing liberally, we conclude that he moved for an extension of time to file a notice of
appeal. While the district court docketed the document as a notice of appeal, Reho’s motion
requested, in the opening paragraph, “a extention of time to filed a certificate of Appealability
. . . and to proceed inform a peuperis on appeal,” and, in the final paragraph, repeated the request
“for the extention of time to file.” Pet’r’s Mot. 1, 3 (errors in original). Reho also offered an
explanation for his delay and asked the court for a pro bono attorney.
No. 22-3784 Reho v. United States Page 3
Admittedly, Reho’s motion appears to ask for an extension to apply for a certificate of
appealability rather than for an extension to file a notice of appeal. But his motion is a far cry
from the simple notices of appeal that we have refused to construe as motions for extension. See
Pryor, 711 F.2d at 65. And it is much closer to a motion for extension than the notice of appeal
that we treated as a motion for extension in Young, because Reho explicitly and repeatedly asks
for an extension. Reho’s motion reads as a motion for extension of time to file a notice of appeal
and will be treated as such.
We therefore REMAND to the district court to determine whether Reho has shown
excusable neglect or good cause so as to merit an extension of time to file a notice of appeal. See
Bell v. McAdory, 820 F.3d 880, 884 (7th Cir. 2016) (citing 28 U.S.C. § 2106). If the district
court, on remand, grants Reho’s motion for extension of time pursuant to 28 U.S.C. § 2107(c),
Reho must file a separate notice of appeal in the district court before this court can consider his
application for a certificate of appealability.
ENTERED BY ORDER OF THE COURT
Deborah S. Hunt, Clerk | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8483567/ | NOT RECOMMENDED FOR PUBLICATION
File Name: 22a0456n.06
Case No. 21-4167
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
FILED
Nov 14, 2022
)
UNITED STATES OF AMERICA, DEBORAH S. HUNT, Clerk
)
Plaintiff-Appellee, )
) ON APPEAL FROM THE UNITED
v. ) STATES DISTRICT COURT FOR
) THE NORTHERN DISTRICT OF
RICHARD WITHERSPOON, JR., ) OHIO
Defendant-Appellant. )
) OPINION
Before: SUTTON, Chief Judge; GRIFFIN and NALBANDIAN, Circuit Judges.
SUTTON, Chief Judge. Richard Witherspoon dropped off a vehicle at a car dealership for
repairs. In the course of working on the car, a mechanic discovered narcotics and a gun in a hidden
compartment of the vehicle. He notified the police. After their investigation and seizure of the
contraband, a grand jury charged Witherspoon with violating federal drug-distribution and
weapons laws. He pleaded guilty but conditioned his plea on the right to challenge the district
court’s rejection of his motion to suppress the evidence. We affirm.
I.
Witherspoon dropped off a maroon Chrysler Pacifica for repairs at the Ganley Chrysler
Dodge Jeep Ram Dealership. The work order specified that the Pacifica was under warranty, had
“loose rear suspension components,” and needed a 23-point inspection. R.63 at 36. While working
on the Pacifica, one of the car mechanics noticed that the driver’s window did not work. As a
matter of policy, if a Ganley mechanic finds a problem with a vehicle under warranty, he fixes it
Case No. 21-4167, United States v. Witherspoon
without contacting the owner. The mechanic removed the door panel, revealing a compartment
with a gun and a baggie of white powder inside. The mechanic notified the service manager, who
called the police.
Sergeant Sean Allred went to the dealership. He looked at the Pacifica without “touching
anything” and “observed the firearm and narcotics.” R.63 at 12. He called in the narcotics team:
Sergeant Brian Sara and Detective Mike Griffis. They too could “see clearly that there was a gun
and what appeared to be narcotics inside the door panel” and a digital scale on the center console.
R.63 at 27–29.
The narcotics team decided to apprehend Witherspoon. They collected the firearm and
narcotics from the hidden compartment and left the scale on the console. Then they asked the
service manager to reassemble the vehicle and to tell Witherspoon to pick up his car. The narcotics
team staked out the dealership’s parking lot. Using a description of his clothing, the narcotics
team identified Witherspoon as he arrived, retrieved the Pacifica, and drove away. Within minutes,
the officers stopped Witherspoon, arrested him, took the Pacifica to the police department, and
searched it. They found the scale in the hidden compartment along with a new bag of narcotics.
A grand jury charged Witherspoon with two counts of possessing with intent to distribute
heroin and fentanyl, one count of being a felon in possession of a firearm, and one count of carrying
a firearm during a drug trafficking crime. He moved to suppress the evidence. The court denied
the motion. Witherspoon conditionally pleaded guilty and received a 100-month sentence.
Invoking the condition, he appeals the denial of his suppression motion.
2
Case No. 21-4167, United States v. Witherspoon
II.
Witherspoon challenges four features of this search and seizure.
The mechanic’s removal of the door panel. Witherspoon complains that the mechanic
violated the Fourth Amendment’s guarantee “to be secure . . . against unreasonable searches and
seizures” when he opened the side door compartment. U.S. Const. amend. IV. But the guarantee
limits “only governmental action,” not the action of private citizens. United States v. Jacobsen,
466 U.S. 109, 113 (1984). The mechanic worked for a private car dealership, and his discovery
of the contraband was not “fairly,” or for that matter remotely, “attributable to the government.”
United States v. Miller, 982 F.3d 412, 422 (6th Cir. 2020) (quotations omitted). Triggering this
sequence of events was Witherspoon’s decision to take his car in for repairs, not anything the
government did. That means the Fourth Amendment does not apply. Burdeau v. McDowell, 256
U.S. 465, 475 (1921).
It makes no difference that Witherspoon may have had a subjective expectation of privacy
in the car’s closed containers and that he never consented to the panel’s removal. That merely
shows that the car dealership undercut his expectation of privacy, not that the government did.
“Whether those invasions were accidental or deliberate, and whether they were reasonable or
unreasonable, they did not violate the Fourth Amendment because of their private character.”
Jacobsen, 466 U.S. at 115.
Seizure of the contraband. Witherspoon separately challenges the police officers’
warrantless seizure of the car’s drugs and gun at the dealership when they first arrived. The Fourth
Amendment ordinarily requires officers to obtain a warrant before seizing someone’s property. Id.
at 113–14. But the plain-view exception to the warrant requirement covers this seizure. It applies
when an officer occupies a legitimate vantage point, sees contraband whose “incriminating
3
Case No. 21-4167, United States v. Witherspoon
character” is “immediately apparent,” and the officer has “a lawful right of access to the object.”
Horton v. California, 496 U.S. 128, 136–37 (1990); see United States v. Clancy, 979 F.3d 1135,
1137 (6th Cir. 2020).
Recall the sequence of events. The manager of the car dealership invited the officers into
the garage, where the Pacifica was parked with the driver’s door open. The officers were “lawfully
in a position from which to view the interior of the vehicle.” United States v. Galaviz, 645 F.3d
347, 356 (6th Cir. 2011). They didn’t need to touch anything to see the contraband. They “merely
look[ed] at what [was] already exposed to view, without disturbing it,” meaning they did not
conduct a “‘search’ for Fourth Amendment purposes.” Arizona v. Hicks, 480 U.S. 321, 328 (1987);
see Clancy, 979 F.3d at 1138. The incriminating location and character of the contraband also
were apparent. Sergeant Allred believed the baggie of white powder was heroin or fentanyl based
on his training and experience. The gun appeared next to the narcotics, linking it to criminal
activity. Sergeant Sara testified that drug traffickers routinely use hidden compartments in
vehicles, called “trap[s],” to store contraband. R.63 at 26.
Witherspoon pushes back, noting the Pacifica was parked at the dealership, leaving no
time-based or mobility-based exigency for declining to get a warrant. All true, but all unhelpful
to Witherspoon all the same. The venerable automobile exception to the warrant requirement
permits a warrantless search of a vehicle if an officer has probable cause to believe it contains
contraband. Carroll v. United States, 267 U.S. 132, 149 (1925); California v. Acevedo, 500 U.S.
565, 580 (1991). The seen narcotics and the gun provided probable cause that the Pacifica
contained evidence of a crime. The automobile exception requires nothing more, and in particular
it does not require a time-based or travel-based exigency. Maryland v. Dyson, 527 U.S. 465, 466–
67 (1999) (per curiam). Keep in mind that mobility is not the only justification for the rule. So
4
Case No. 21-4167, United States v. Witherspoon
too is “the pervasive regulation of vehicles.” Collins v. Virginia, 138 S. Ct. 1663, 1670 (2018)
(quotations omitted). Hence the Supreme Court has upheld warrantless searches of cars even
without a flight risk. See, e.g., Florida v. Meyers, 466 U.S. 380, 382–83 (1984) (per curiam);
Michigan v. Thomas, 458 U.S. 259, 261–62 (1982) (per curiam). That the officers could have
obtained a warrant in this case ultimately makes no difference. Dyson, 527 U.S. at 466–67.
Traffic stop and arrest. Witherspoon separately challenges the traffic stop and arrest. Both
of them qualify as seizures under the Fourth Amendment, to be sure. Delaware v. Prouse, 440
U.S. 648, 653 (1979). And both were warrantless, to be sure as well. But officers may stop a
vehicle “without a warrant when they have probable cause to believe that the occupants have
committed a crime.” United States v. Brooks, 987 F.3d 593, 598 (6th Cir. 2021). Officers likewise
may make a warrantless arrest when, “at the moment the arrest was made,” they “had probable
cause to make it.” Beck v. Ohio, 379 U.S. 89, 91 (1964).
The officers checked every box, as a brief reminder of what they knew confirms.
Witherspoon dropped off the Pacifica. It contained a gun and suspected narcotics in a “trap” and
a digital scale on the center console. The dealership’s employees provided a description of
Witherspoon’s clothing. A person wearing those clothes retrieved the Pacifica and drove away.
Based on this set of facts, the officers had probable cause to believe that Witherspoon had
committed a crime. It follows that they could pull over the Pacifica and arrest Witherspoon without
a warrant, both without running afoul of the Fourth Amendment.
But the officers could not be sure, Witherspoon points out, that he knew about the hidden
contraband. But as the phrase suggests, “probable cause concerns probabilities, not certainties.”
United States v. Lanier, 636 F.3d 228, 234 (6th Cir. 2011). All available information indicated
that Witherspoon controlled the Pacifica, creating a fair probability that he knew about its contents.
5
Case No. 21-4167, United States v. Witherspoon
Plus, the digital scale, a form of drug paraphernalia, sat conspicuously on the center console. See
United States v. Montgomery, 377 F.3d 582, 591 n.5 (6th Cir. 2004) (possessing digital scale can
violate Ohio drug laws). The exposed scale created a fair probability that Witherspoon knew about
the hidden contraband too. While the officers may not have had absolute certainty that
Witherspoon was dealing drugs, they had ample information to stop and arrest him.
What of the reality that the officers removed the gun and drugs prior to the traffic stop,
leaving no ongoing crime to prevent, no probable cause to serve as a premise for the stop, and no
evidence of a new crime such as a traffic violation? None of this matters. The officers had
probable cause of a past crime—indeed considerable evidence of a past crime—and that
empowered them to pull Witherspoon over regardless of whether he had another gun or more drugs
with him or whether he subsequently violated a traffic law. See Brooks, 987 F.3d at 598.
Search of the vehicle. A similar conclusion applies to the warrantless search of the Pacifica
at the police department. The automobile exception, once again, validates it. See Meyers, 466
U.S. at 382; United States v. Ross, 456 U.S. 798, 825 (1982). The officers found a gun and
narcotics in a hidden compartment in the Pacifica. And the officers left drug paraphernalia (the
digital scale) on the vehicle’s center console. In between retrieving the Pacifica and his arrest,
Witherspoon moved the digital scale. All of this provided a fair probability that the Pacifica
contained contraband, enabling a warrantless search of the vehicle at the police department. See
Dyson, 527 U.S. at 467; Collins, 138 S. Ct. at 1670.
We affirm.
6 | 01-04-2023 | 11-14-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490545/ | MEMORANDUM DECISION
THOMAS C. BRITTON, Chief Judge.
Plaintiff, Delray Executive Square, Ltd., seeks to recover rent proceeds in the amount of $6,725 allegedly transferred to the debtor’s counsel in violation of plaintiff’s lien rights. Defendants moved for judgment on the pleadings (C.P. No. 4) asserting that as a matter of law plaintiff had no right to the rents. The matter was tried on June 30.
Plaintiff claims a security interest in the rents under an assignment contained in its mortgage, security agreement, collateral assignment of rents and a UCC-1. Plaintiff filed a foreclosure action against the debtor’s property on-March 11, 1987. On March 13 and 18, the debtor paid the defendants the sum of $6,725 for legal services. Plaintiff’s motion for appointment of a receiver was set for hearing on March 25 in state court.
The bankruptcy petition was filed on March 25. Finding its forum shifted from state court to bankruptcy court, this creditor filed a motion on March 27 (Case No. 87-00975 (C.P. No. 2)) to sequester the rents under § 363(c)(2) and (4). That matter was scheduled for an emergency hearing on March 31. This court did not resolve the matter presented at that hearing, which was taken under advisement, because it was later advised that the parties had amicably resolved the dispute. However, this complaint raises the identical issue of the lien rights to rents asserted by plaintiff in its earlier requests to segregate cash collateral and for relief from stay. (Case No. 87-00975 (C.P. No. 2a)).
State law is controlling on the issue of what is required of a creditor to perfect a lien on rents. Plaintiff argues that by moving for the appointment of a receiver in the foreclosure action and taking additional action in this court, it comes within the requirements stated by the court in White v. Anthony Inv. Co., 119 Fla. 108, 160 So. 881, 882 (1935). I disagree.
In the White case, the court stated that:
“[the] mortgagee becomes entitled to receive such rents ... from the time he takes possession of the property either by consent of the owner or through the appointment of a receiver.”
*303The debtor had possession of the rent proceeds and was under no legal restraint to refrain from using the funds. As stated in Michelsen v. Penney, 135 F.2d 409, 423 (2nd Cir.1943) (citing White):
“the mortgagor, until the mortgagee takes possession, is entitled to the rents and is in charge of the premises.... ”
The mortgagee had not perfected its lien merely by moving in the state court for appointment of a receiver.
“Only through a receiver to collect future rents could the lien on rents be made effective.” White at 882.
The relief necessary to create the lien was never granted. When the mortgagee sought stay relief (C.P. No. 2a) to proceed with perfection of its lien by appointment of a receiver (later withdrawn), the payments to the defendants had already been made. The requirements of possession or appointment of a receiver necessary to perfect its lien on the rents were never satisfied by the plaintiff mortgagee as to the $6,725 paid to defendants.
Accordingly, I find that the rents collected by the debtor were not subject to a lien in favor of plaintiff when the funds were used to pay the defendants. As is required by B.R. 9021(a), a separate judgment will be entered dismissing this complaint with prejudice. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490546/ | MEMORANDUM OPINION AND ORDER
RICHARD L. SPEER, Bankruptcy Judge.
This cause comes before the Court on the Objection of Trustee to the Claim of Ther-modyn Corporation. A Hearing was held on this matter, at which time the parties agreed that the issue presented was solely a question of law. Accordingly, counsel filed their arguments on the relevancy and application of O.R.C. § 1333.31 to the instant case. The Court has reviewed the written arguments of counsel, as well as the entire record in this case. Based on that review, and for the following reasons, the Court finds that the Trustee’s Objection should be Denied.
FACTS
The facts in this matter do not appear to be in serious dispute. On February 4, 1987, Flue Gas Resources, Inc. (hereinafter “Flue Gas”) filed a voluntary petition under 11 U.S.C. Chapter 7. Thermodyn Corporation (hereinafter “Thermodyn”) is a creditor of Flue Gas, and filed a proof of claim in this case for Thirty-six Thousand Four Hundred and Fifty Dollars and Sixty-nine Cents ($36,450.69). This debt arose from the fabrication and sale of various molds to Flue Gas, and for the fabrication of parts using the molds. The Debtor owed Thermodyn a balance of at least Twenty-seven Thousand Two Hundred and Twenty-six Dollars and Seventy-nine Cents ($27,226.79) for the fabrication of the rubber parts, and Five Thousand Four Hundred Dollars ($5,400.00) for making the molds.
The molds were manufactured for Flue Gas by Thermodyn between March 21,1985 and August 15, 1986. Subsequent to the filing of the Chapter 7 petition and more *630than sixty (60) days after the last payment was due on the molds, Thermodyn served upon the Trustee a “final notice”. The “final notice” contained a request for payment, along with an itemized statement of the amount due, and a description of the molds involved. Also included was a statement that unless the amount due and the cost of the notification was paid within thirty (30) days, Thermodyn would retain the molds and proceed to enforce its lien rights under O.R.C. § 1333.31. It should be noted that Thermodyn has, at all times, maintained exclusive possession of the molds.
On March 30, 1987, the Trustee Objected to Thermodyn’s claim of a molder’s lien.
LAW
Ohio’s molder’s lien statute is set forth in § 1333.29 through § 1333.31 of the Revised Code. O.R.C. § 1333.31(A) states in pertinent part:
(A)(1) A molder has a lien on a die, mold, pattern, or form that is in his possession and that belongs to a customer, for the following:
(a) The amount due from the customer for plastic, metal, paper, china, ceramic, glass, or rubber fabrication work performed with the die, mold, pattern, or form, or for making or improving the die, mold, patterns, or form;
(b) The cost associated with the notification described in division (B) of this section;
The Trustee does not dispute that, under § 1333.31, Thermodyn has a lien on the molds in its possession for the amounts due for the fabrication of the molds and the work performed with the molds. The Trustee’s position is that the lien was un-perfected at the time of the filing of the petition, and was therefore avoidable under 11 U.S.C. § 545(2) which provides:
The trustee may avoid the fixing of a statutory lien on property of the debtor to the extent that such lien—
(2) is not perfected or enforceable at the time of the commencement of the case against a bona fide purchaser that purchases such property at the time of the commencement of the case, whether or not such a purchaser exists;
Or, as is stated in Collier’s:
Section 545(2) requires perfection of the lien and establishes, essentially, a bona fide purchaser of property subject to the lien, test to determine perfection.
This test states, first of all, that for a statutory lien to be valid against the trustee it must be perfected or enforceable against one acquiring the rights of a bona fide purchaser of property subject to the lien, whether or not such a purchaser actually exists, at the time of the commencement of the case.
4 Collier on Bankruptcy § 545.04[2] at 545-18 (15th ed. 1987). See also, Lincoln Nat. Bank v. Conti, 27 B.R. 175 (Bankr.S.D.Ohio 1982). Alternatively, the Trustee cites § 547(b)(6).
Thermodyn contends that the lien cannot be avoided under § 545(2) because it was perfected by possession. The Trustee asserts that the lien was not perfected, there being additional actions required under the statute prior to enforcement. Specifically, the Trustee argues that the “final notice”, which is to be sent within sixty (60) days of the due date of the final payment, is the act that results in the lien being perfected. It is the Trustee’s position that the statutory requirements should be strictly construed. Further, the Trustee points out that there is no provision in § 1333.31 allowing the “final notice” to relate back to the period prior to the bankruptcy filing.
Therefore, the issue before the Court is whether Thermodyn’s § 1333.31 molder’s lien was unperfected, or perfected by possession. There does not appear to be any Ohio cases construing § 1333.31, nor has any other state construed its molder’s lien statute in a published Opinion. There also appears to be a paucity of legislative history concerning this particular Ohio statute. Thus, the Court must turn to the general rules of construction of lien statutes, and examine the purposes behind the legal concept of perfection.
The molder’s lien statute gives the molder a lien based on possession of the mold. *631To enforce the lien through a sale of the molds, the mold maker must follow certain requirements listed in the statute. In construing § 1333.31, it should be noted that courts have held that a statutory lien exists independent of the various means of enforcement the statute permits. Moses v. Labofish, 132 F.2d 16, 17 (D.C. Cir.1942); 51 Am.Jur.2d, Liens § 39.
In the case at bar, the lien is a “specific lien” because it is for a claim due in relation to that property upon which the lien attaches, rather than for an unrelated general balance. 66 O.Jur.3d, Liens § 3. “Specific Liens” are favored by the law, and should be sustained whenever it is possible to do so without violating positive law. 66 O.Jur.3d, Liens § 4; 52 Am. Jur.2d, Liens § 11.
Further, a statutory lien which is declaratory of a common law lien, and is not in derogation of it, must be given such construction as will give the lien claimant the full limit of the security intended to be provided by the legislature. M & M Hotel Co. v. Nichols 5 Ohio Op. 387, 388-389, 32 N.E.2d 463 (1935); 66 O.Jur.3d, Liens § 28. It appears to the Court that the molder’s lien is a codification of a common law artisan’s lien, and therefore should be given a liberal construction under Ohio law. Such a construction would lead the Court to find that the possession of the molds is the act which perfects the lien, rather than the mailing of the “final notice” to the customer. Moreover, this finding would be consistent with the general rule that a lien which is declaratory of the common law must be interpreted in conformity with common law principles. 51 Am.Jur.2d, Liens § 38. Under the common law, superior rights were typically obtained through possession of the property.
The Ohio Courts have also looked at the policy conflict between an artisan’s or mechanic's interest in recovering fair compensation through the use of liens, and the interest in keeping goods moving in the free flow of commerce in conjunction with the interests of third parties who purchase or lease liened property. Church v. Bill Swad Leasing 2 Ohio App.3d 382, 442 N.E.2d 78 (1981). The accommodation of these competing principles is achieved by requiring notice, in a public manner, of any lien that is going to defeat the claim of a bona fide purchaser. To clarify, this discussion is in connection with the interpretation of § 1333.31, and whether the lien given by the statute was perfected by possession. It is state law which creates and defines property interests. Butner v. United States 440 U.S. 48, 99 S.Ct. 914, 59 L.Ed.2d 136 (1979). The Trustee will not have notice imputed to him, under § 545(2), by Thermodyn’s possession. Rather, the Court believes that the legislature intended that the molder’s lien be perfected by possession, and it is the perfected status of the lien which prevents the Trustee from avoiding it under § 545(2).
Even more fundamental to the Court’s decision is the practical effects of the two different acts that the parties claim should result in the lien being perfected. Even if there were no presumptions favoring the particular lien involved, the Court would have to look at which act, as a practical matter, was actually giving notice to the world of the molder’s security interest. Although the statute provides for a “final notice”, it only goes to the customer. The “final notice” would not provide notice to a bona fide purchaser. The act which prevented the molder’s lien from being a “secret lien” was the possession of the molds by the mold maker. Therefore, as perfection is a concept based upon the idea of providing general notice of lien interests, and possession was the act which provided that notice to third parties under § 1333.31, the Court finds that the lien was perfected by possession.
Therefore, a molder’s lien being perfected by possession, and it being undisputed that Thermodyn has been in continuous possession of the molds in question, it follows that the Trustee cannot avoid Thermo-dyn’s lien under 11 U.S.C. § 545(2). However, one problem remains. Section 1333.-31(B) outlines the procedures to be followed for the sale of the molds. Under that subsection, the molder “may” send a *632“final notice” to the customer within sixty (60) days from the due date of the final payment on the molds. While this “final notice” is permissive, (the statute using the word “may”), it appears that the sending of a “final notice” is required before the molds are sold under the provisions of § 1333.31(B). On the other hand, prior to subsection B’s detailing of the molder’s right to sell, § 1333.31(A) gives the mold maker the right to retain possession of the molds until full payment is made.
(2) Except as provided in division (C) of this section, the molder may retain possession of the die, mold, pattern, or form until the customer pays all applicable monetary amounts described in division (A)(1) of this section or the die, mold, pattern, or form is sold in accordance with this section.
Under the above provision, Thermodyn may be left with only a perpetual right to retain possession of the molds. They can never sell in accordance with section 1333.-31 because they have missed the sixty (60) day deadline, and Flue Gas will not pay the amounts due. The Court will restrain its enthusiasm for an exploration of the applicability of the Rule Against Perpetuities to personal property, and instead will consider an equitable remedy to this problem. If Thermodyn is denied the right to sell the molds, they would appear to have little choice but to resort to some subterfuge such as a lease for an extended period, or seeking a lien for storage upon which they could execute. Such a course would not benefit anyone. Therefore, there appearing to be no strong public policy which would be violated by permitting the sale of the molds, and equity allowing a remedy to be crafted, the Court will allow the sale of the molds by Thermodyn. If the molds sell for more than the amount of Thermodyn’s lien, then, as called for by § 1333.31, the surplus shall go to the Trustee as the successor in interest to the customer.
Therefore, it is
ORDERED that the Trustee’s Objection be, and is hereby, DENIED.
It is FURTHER ORDERED that Ther-modyn be, and is hereby, allowed to sell those molds fabricated for Flue Gas Resources, Inc. which remain in Thermodyn’s possession.
It is FURTHER ORDERED that if the sale of the molds generated funds which are over and above the amount of Thermo-dyn’s lien, that those funds be turned over to the Trustee of the Flue Gas bankruptcy estate. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490717/ | MEMORANDUM DECISION
THOMAS C. BRITTON, Chief Judge.
The trustee seeks recovery under 11 U.S. C. § 547(b) of $200,000 as an alleged preferential transfer to the defendant. The defendant has answered and' the matter was tried on May 31.
The trustee claims that the following actions constituted a preferential transfer of the debtor’s property to or for the benefit of the creditor.
On December 26,1984 the debtor entered into a construction contract as subcontractor with the predecessor of the defendant. A performance bond or a letter of credit to secure performance was required as a condition of the contract. The debtor commenced work on the construction project in February, 1985. A letter of credit was issued on April 1, 1985 for the benefit of defendant. The debtor furnished collateral for the letter of credit in the form of a $200,000 certificate of deposit in the name of its parent corporation, Taurus. Entries were made in the records of the debtor and Taurus documenting the character of the transaction as a $200,000 loan from the parent. The debtor defaulted in its performance under the construction contract and the letter of credit was drawn upon on June 14, 1985 and actually paid on June 18.
*433The debtor’s chapter 11 petition was filed on June 17. The case was subsequently converted to chapter 7. The trustee is seeking on behalf of the estate the amount of the CD that was used to obtain the letter of credit.
It is the trustee’s burden to establish each of the five elements in this purely statutory cause of action. § 547(b). The defendant has disputed every conceivable issue including raising the affirmative defenses available under § 547(c).
It is the defendant’s position that the transfer of the CD as security for the letter of credit was not a:
“transfer of property of the debtor (1) to or for the benefit of a creditor; (2) for or on account of an antecedent debt owed by the debtor before such transfer was made.”
If defendant is right, the trustee must fail because he has the burden of proving the foregoing elements.
The evidence on the first issue is in conflict. The ledger entries showing a loan from the parent Taurus to the debtor to enable the debtor to pledge Taurus’ CD for the letter of credit are self-serving. There is no promissory note from the debtor to Taurus. The trustee tried to prove the debtor’s ownership of the CD by the testimony of officers of both corporations that the loan was an actual transaction as part of the established pattern used by Taurus to fund the operations of its subsidiary. The “loan” was to provide collateral in this particular instance for the purpose of setting up the letter of credit. The duration of actual ownership of the CD by the debt- or before using it for this purpose probably never existed as a matter of fact.
Taurus’ $200,000 CD was an asset which passed through the debtor on paper only and its disposition was predetermined by Taurus before the “loan”. The trustee’s own witness, an officer of Taurus and the debtor, does not dispute that the money was loaned for a specific purpose to set up the Ameritech letter of credit. I find that the transfer of this designated asset from the parent corporation through the debtor subsidiary to a bank for a letter of credit to benefit the defendant did not deplete the debtor’s estate of an asset which otherwise would have been available for the claims of other creditors. The trustee has failed to prove element (1) under § 547(b).
In addition, the trustee has completely failed to prove element (2). The theory relied upon by the trustee to establish the existence of an antecedent debt was the delayed issuance of the letter of credit which “post-dated the obligation created by the [construction] contract and addendum.” (Plaintiffs Post-Trial Memo at p. 11). The trustee argues that this failure of the debtor to timely comply with a contract requirement is a default and, therefore, an antecedent debt. I disagree. The record establishes no debt owing from the debtor to the defendant. In fact, it was candidly admitted by a former officer of the debtor that the defendant owed construction progress payments to the debtor when the letter of credit was issued. (TR at 81-82).
The trustee relies on In re Air Conditioning, Inc. of Stuart, 845 F.2d 298 (11th Cir.1988) which is based on facts with significant differences from the case here. In that case the antecedent debt was undisputed and the source of the funds for the CD was not proved to be other than the debtor’s own assets. The court’s recital of the legal conclusion that:
“[w]hen a debtor pledges its assets to secure a letter of credit, a transfer of the debtor’s property has occurred under the provisions of 11 U.S.C. § 547,”
does not abrogate the need for proof that the pledged asset was the debtor’s property. In fact the court in Air Conditioning, Inc. stated:
“[tjhere are several possible sources from which the $20,000 could have come such that the transfer to the bank would not have created a preference.” Id. at 297-98.
It follows, that the trustee has failed to prove elements (1) and (2) of an avoidable preferential transfer under § 547(b). It is, therefore, not necessary to consider the statutory exceptions provided by § 547(c) *434raised as affirmative defenses. The complaint is dismissed with prejudice. As is required by B.R. 9021(a), a separate judgment will so provide. Costs may be taxed on motion. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490718/ | ORDER DENYING CONFIRMATION AND DISMISSING CASE
THOMAS C. BRITTON, Chief Judge.
A confirmation hearing was held April 19 and 21 in this chapter 11 case. Since the hearing, the debtor has filed a Fifth Amended Plan (CP 147). The debtor may modify its plan at any time before confirmation. 11 U.S.C. § 1127. Although this modification appears to adversely affect a party (see note 2 infra), in view of the conclusion I have reached with respect to the Fifth Plan, no purpose would be served by an further hearing under B.R. 3019 to determine whether the plan adversely affects anyone.
The debtor has complied (CP 154,155) with the Order Reserving Ruling on Confirmation (CP 127), and the U.S. Trustee has filed his Report (CP 170).
Impaired Classes
The plan provides for five classes of claims. I agree with the U.S. Trustee’s analysis that Classes IV and V are impaired by the plan. The two significant creditors in Class II, the debtor’s first and second mortgagees, also claim impairment of that class (CP 108,116).1 I agree.
The value of their collateral has been determined by this court to be $4,715 million. Their claims were liquidated by a prepetition foreclosure decree. The foreclosure sale, scheduled December 7, 1987 was thwarted by this bankruptcy, filed that day. The second mortgagee is underse-cured in the amount of $342,558.
The plan provides for reinstatement of the foreclosed loan and resumed installment payments of the $4,715 million upon the original terms.
A class is impaired by a plan, unless it meets one of the three requirements specified in § 1124. This plan does not attempt to satisfy the third requirement, which calls for immediate cash payment.
Because the plan deprives the mortgagees of their contractual right of acceleration, which matured and was exercised before bankruptcy, the plan does not meet the first requirement, that the plan:
“leaves unaltered the legal, equitable, and contractual rights to which such *441claim or interest entitles the holder of such claim or interest.” § 1124(1).
Unless this interpretation of § 1124(1) is accepted, subparagraph (2) would serve no purpose whatsoever. Statutes should, of course, be so interpreted as to give some meaning to every provision.
The only remaining option (the second) requires that four conditions be met, the first of which is that the plan:
“cures any such default that occurred before or after the commencement of the case ... .” § 1124(2).
Deferred payments, as provided in this plan, cannot meet the requirement of this subsection, for the reasons explained in In re Jones, 32 B.R. 951, 959-60 (Bankr.D. Utah, 1983). As that court stated:
“Section 1124(2), like Section 1124(3), does not protect against unfair discrimination or require fair and equitable treatment. Surely Congress did not intend to permit under Section 1124(2) the same injury it prevented when it narrowed Section 1124(3).”
I find, therefore, that Classes II, IV and V are impaired by this plan.
The Vote
It is undisputed that Classes II and V have rejected the plan. I now find that the remaining impaired class, Class IV, has also rejected the plan.2
Four creditors in class IV filed acceptances. (CP 154 at 3). The first two, Hat-ton and Hatton Properties, Inc., are conceded to be “insiders”, as that term is defined in § 101(30), and therefore may not be counted. § 1129(a)(10).3
The third acceptance, by Stephen Cook bears the notation that it is to be counted only if the debtor forgoes its right to object to Cook’s claim for $183,232. The debtor has stated:
“The Debtor-In-Possession contemplates the filing of a possible objection to the claim of Stephen Cook, Esquire, limited as to its amount only. Reduction of the amount of this claim by the Court will not effect [sic] acceptance by Class IV.” (CP 154 at 3).
If a conditional acceptance ever constitutes acceptance, which I doubt, the condition has been rejected.
The fourth acceptance came after the voting deadline through the creditor’s attempt to amend its timely original ballot from rejection to acceptance. The creditor election becomes meaningless unless the tally is based upon the ballots received before the voting deadline. I disregard the attempted amendment.
Denial of Confirmation Under § 1129(a)(8)
This subsection prohibits confirmation unless each impaired class has accepted the plan. As we have just seen, none of the three impaired classes accepted this plan.
Denial of Confirmation Under § 1129(a)(10)
This subsection prohibits confirmation unless at least one impaired class has accepted the plan. As we have just seen, no impaired class accepted this plan.
Denial of Confirmation Under § 1129(a)(ll)
This subsection prohibits confirmation unless the court can find that:
“Confirmation of the plan is not likely to be followed by the liquidation, or the need for further financial reorganization, of the debtor or any successor to the debtor under the plan, unless such liquidation or reorganization is proposed by the plan.”
*442I cannot make such a finding from this record.
The feasibility of this debtor’s plan depends solely upon its ability to achieve the debtor’s financial projections over the next five years. No additional capital is available.
The evidence in support of and opposing the feasibility of the debtor’s projections is in sharp conflict, and it is always difficult to predict the future. It is plaintiff’s burden to prove it can support its plan. It has failed to do so here.
The debtor’s projections assume a substantial increase in the operating profit from the previous year’s experience. The State Court receiver, who operated the facility during that period, estimates that the necessary increase exceeds $600,000 and represents almost 150%. This would be an extraordinary feat for any entity in bankruptcy after defaulting on its mortgages.
Two circumstances that led to this facility’s financial distress are its almost complete dependence upon Medicaid patients, who are at best marginally profitable, and its remote location, which restricts its clientele and inflates its personnel expense. There is no indication that these circumstances, or any others affecting income or expenses, are likely to change for the better over the next five years. I see no chance that they will change to the degree necessary to achieve the fiscal miracle required by this plan.
Denial of Cramdown Under § 1129(b)
Confirmation of a plan rejected by an impaired class (cramdown) is available only “if all of the applicable requirements of subsection (a) of [§ 1129] other than paragraph (8) are met with respect to a plan.” § 1129(b)(1). Cramdown is not available here, because the plan also fails to comply with § 1129(a)(10) and (11). We need not, therefore, consider whether this debtor has met the other cramdown requirements.
Dismissal
Barnett, the major creditor, has renewed its motion for dismissal. The case has been pending over seven months. The debtor has advanced five plans none of which has been accepted by the creditors nor is entitled to confirmation. The debtor is being burdened not only by the expense of co-trustees and the expense of its own two attorneys as well as the attorneys representing its secured creditor, but is also operating under the cloud of its bankruptcy. No end to this expensive battle is in sight.
This case is dismissed under § 1112(b)(1) and (5). Dismissal is with prejudice to the filing of any further bankruptcy petition by this debtor earlier than one year after this order becomes final.
. The remaining creditor in the class, Bank of Pahokee with a $11,500 claim does not appear to be impaired.
. Because of this conclusion, it is not necessary to consider the fact that the debtor after the vote on its plan, filed its Fifth Amended Plan which reclassified Barnett's unsecured claim from Class IV (where its presence resulted in rejection of the plan) to a new Class V (where it resides alone). The apparent purpose of this amendment is an effort to meet the requirement of§ 1129(a)(10). I do not intend that my treatment of this argument made by Barnett (CP 160 at 5) be interpreted as approval of the debtor’s attempted gerrymandering.
. Each of these claims has been disallowed by a separate Order. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490719/ | MEMORANDUM DECISION
THOMAS C. BRITTON, Chief Judge.
The plaintiff ex-wife seeks exception from discharge under 11 U.S.C. § 523(a)(5)1 for her claim of $45,600. The debtor has answered and the matter was tried on July 12. I agree with
The Settlement Agreement of September 10, 1986, incorporated in the November 19, 1986 divorce decree, contains an explicit, irrevocable waiver of alimony and support by plaintiff.
In addition to dividing some personal effects, including two cars, and providing an escrow account to pay for some joint bills, the Agreement deals with two corporations: Lang Design Group and Lang Interiors Group. He got the first and she got the second. With reference to the first, Design Group, the Agreement provides that:
“As and for consideration for said transfer, the Husband agrees to pay the wife the sum of $1,900 per month for a period of two years or 24 consecutive months, the first payment being due [September 25, 1986].” 2
Plaintiff now claims that the quoted provision was in fact alimony. She points to some bankruptcy court decisions which discuss indicia helpful in determining whether separating spouses intended money payments to be alimony payments or the division of family property. These indicia are useful only when the actual intent of the parties is unclear. They do not displace the parties’ intent. In this instance, the actual intent of the parties is clear as a bell.
The terms of the Agreement are clear and unambiguous with respect to this point. The Agreement was drafted by the plaintiff’s attorney. She admits that the Agreement was explained to her by her attorney and that she understood it. The debtor had no attorney.
Alimony was never discussed between them and no court would have awarded her $22,800 alimony. I do not believe that any *449court would have awarded her any alimony. He would never have agreed to pay any alimony. She agreed to assume her own legal expense.
They had been married four and a half years. There were three children by previous marriage, but none of this marriage. She receives child support from her previous spouse. They are young and both enjoy good health. She concedes that their educational backgrounds are comparable.
Each party was self-supporting when they married. The year they separated, his tax return showed taxable income of $15,-000 and hers showed $8,000, with all their living expenses charged to his corporation. Neither party was dependant upon support from the other when they separated.
In order to shield the business from a possible IRS claim against his daughter, he transferred all his business stock to her. The second corporation, entirely in her name, was created later, during the month they broke up.
When they married, she was a waitress and he, with his mother, owned and operated a residential designer business. He could not balance his own check book and she very capably took over the business management. She estimates her contribution to the business to be one-third. She was at least as able to and as successful in protecting her interest as he was in protecting his. I think she did very well.
I find that plaintiff has failed to carry her burden of showing that the debt owed her is for alimony, maintenance or support. It is, therefore, dischargeable. As is required by B.R. 9021(a), a separate judgment will be entered dismissing the complaint with prejudice and costs may be taxed on motion.
. This subsection excepts from discharge: “any debt ... (5) to a spouse, former spouse, or child of the debtor, for alimony to, maintenance for, or support of such spouse or child, in connection with a separation agreement, divorce decree ... or property settlement agreement, but not to the extent that ... (B) such debt includes a liability designated as alimony, maintenance, or support, unless such liability is actually in the nature of alimony, maintenance, or support."
. The Agreement further provides a credit to him against the $1,900 payments for business he refers to her corporation. That credit is 30% of the referrals. However, she can offset up to one-half the 30%:
“in the form of a consulting fee with a guarantee of $1,200 to be paid on account for HELENE JAYNE LANG.”
Finally, the Agreement provides that:
“If at any time prior to the two year period stated herein, the Wife remarries or resides with a male person, the above stated consulting fee of $1,900 shall immediately terminate.” (Emphasis added).
The underscored words are ambiguous. The “consulting fee" is 15% of the referrals. The $1,900 is "consideration for said transfer" — her transfer to him of all stock in Design Group. I resolve that ambiguity against her, as the party who prepared the Agreement, and find that the consulting fee, not the $1,900 terminates upon her remarriage or cohabitation. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490720/ | FINDINGS OF FACT AND CONCLUSIONS OF LAW
SIDNEY M. WEAVER, Bankruptcy Judge.
THIS CAUSE having come before the Court upon Sure-Snap Corporation’s (the debtor’s) Complaint for Preliminary Injunction, to Set Aside Pre-petition Conveyance, for a Turnover of Funds, for Declaratory Judgment, and for a Money Judgment pursuant to 11 U.S.C. § 542, and the Court having heard the testimony, examined the evidence presented, observed the candor and demeanor of the witnesses, considered the arguments of counsel, and being otherwise fully advised in the premises, does hereby make the following Findings of Fact and Conclusions of Law:
Jurisdiction is vested in this Court pursuant to 28 U.S.C. § 157(a) and (b) and § 1334(b) and the district court’s General Order of Reference. This is a core proceeding in which the Court is authorized to hear and determine all matters relating to this case in accordance with 28 U.S.C. § 157(b).
The motion of Gary Shure to dismiss the counterclaim and crossclaim against the debtor and others as yet unknown on behalf of Gary Shure, not directly relevant to the life insurance policy, was granted as to Elaine J. Shure personally, and the counterclaim of Gary Shure for allowance of his claim filed in this case was severed pursuant to Bankruptcy Rule 7021, and will be tried by a separate objection to the claim of Gary Shure to be filed by the debtor. The motion at the trial of the defendants Mitchell Koshers, Steve Koshers, Robert Shure, Gary Shure, and Peter Shure to dismiss the counterclaim and crossclaim against the debtor and New Jersey Life Insurance Company and Elaine J. Shure and others as yet unknown was granted at the trial.
On December 9, 1981, New Jersey Life Insurance Company (“New Jersey Life”) issued a life insurance policy in the face amount of $100,000 (the “life insurance policy”) insuring the life of Alfred Shure, the president and chief operating officer of the debtor. The life insurance policy was a whole life key man insurance policy with a cash surrender value, and listed the debtor as the owner and the only beneficiary on it. The debtor paid all the premiums on the life insurance policy between December 9, *4511981 and the death of the insured, which occured on March 1, 1987.
Upon the death of Alfred Shure, conflicting claims to the insurance proceeds were asserted by the debtor and various of the defendants in this case. The debtor commenced this litigation to determine the rightful owner of the proceeds.
Prior to trial, the insurance proceeds in the total amount of $9,094.83 held by New Jersey Life were deposited in the trust account of Semet, Lickstein, Morgenstern & Berger, P.A. pursuant to Order of this Court entered on May 9, 1988.
The parties agree that to the extent state law is applicable, the law of the state of New York controls this case.
The defendants argue that Alfred Shure created a trust for the benefit of the defendants and then caused the beneficiary of the life insurance policy to be changed from the debtor to the trust. The debtor acknowledges the execution of the trust instrument by Alfred Shure but argues that: no property was settled in the trust at the time of its creation; the debtor never properly authorized or changed the beneficiary of the life insurance policy from the debtor to the trust; and the date of the transfer of the life insurance policy here at issue was the date of the death of the insured, rather than the date of the change of beneficiary of the life insurance policy. Because the insured died within ninety days prior to the filing of the Chapter 11 petition in this case, such a date of transfer would amount to fraudulent conveyance or preference under bankruptcy law.
In 1984 the policy was pledged as collateral to Consolidated Bank, N.A. The funds at issue in this adversary proceeding represent the balance remaining after a payment to Consolidated Bank, N.A. by New Jersey Life to satisfy the Bank’s indebtedness based upon the pledge of the policy.
On April 4, 1984, Alfred Shure signed a trust indenture document settling a trust and naming his three grandchildren as beneficiaries. The trust was revocable at the option of the Settlor. The trust indenture refers to certain property described in a Schedule A to be attached to the indenture document. The attached Schedule A is blank.
On May 25, 1984, the Board of Directors of the debtor authorized a change in the beneficiary of the insurance policy from the debtor to the trust. The corporate minute book contains a certificate that the meeting of the Board of Directors was held, and that the Board authorized this change of beneficiary on May 25, 1984. The debtor was solvent on that date.
None of the beneficiaries under the trust paid any consideration for their interest in the trust, nor did any of the beneficiaries pay any of the insurance premiums on the insurance policy.
On February 5,1985, Alfred Shure corresponded with New Jersey Life, indicating his desire to revoke the trust. Mr. Shure failed to observe the formalities required for revocation of a trust under New York law, however.
From the facts recited, the Court concludes that a valid life insurance trust was created by Alfred Shure on April 4, 1984. The Board of Directors of the debtor authorized a change in the beneficiary of the life insurance policy at issue in this case from the debtor to the trust on May 25, 1984. The date of change of beneficiary, rather than the date of Alfred Shure’s death, is the correct date for determining whether the change of beneficiary amounted to a fraudulent conveyance under New York Debtor and Creditor Law §§ 273, 274 and 276 or 11 U.S.C. § 548.
Although numerous New York cases hold that a conveyance of life insurance to a trust, made while the Settlor is insolvent, is a fraudulent conveyance under New York law, the debtor was solvent at the time of this transfer. Had the debtor been insolvent, the result would have been different. See, e.g., Stoudt v. Guaranty Trust Company of New York, 150 Misc. 675, 271 N.Y.S. 409 (1933); Kramer v. Metropolitan Life Insurance Company, 9 Misc.2d 92, 154 N.Y.S.2d 565 (1956); Gould v. Fleitmann, 176 N.Y.S. 631 (1919); Union Central Life Insurance Company v. *452Flicker, 101 F.2d 857, 861 (9th Cir.1939); See also Feynman v. Rosenthal, 77 F.2d 321 (2d Cir.1935).
Accordingly, the Court concludes that the change of beneficiary of the life insurance policy was valid, that the trust is entitled to payment of the $9,094.83 held by the law firm, and that judgment shall be entered for the trust and against Plaintiff. The parties shall bear their own costs.
A separate Final Judgment of even date has been entered in conformity herewith. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490722/ | MEMORANDUM OPINION
R. GLEN AYERS, Jr., Chief Judge.
The Court has considered the Defendant’s Motion for Relief from Summary Judgment and the Response thereto. The following constitutes the Court's mixed findings of fact and conclusions of law.
Plaintiff NEAL R. ALLEN, TRUSTEE OF LIBERTY TRUST CO., filed a Motion for Summary Judgment on April 22, 1988. The date reflected in the attached Certificate of Service indicates that a copy was mailed to counsel for First Savings of Louisiana on April 21, 1988. The affidavit of First Savings’ attorney states that the Motion for Summary Judgment was received on April 25, 1988. First Savings never filed a response to the Motion for Summary Judgment. The affidavit does not state any reason for the failure to respond to the motion.
In its Motion for Relief, First Savings refers to Rule 9013 of the Local Rules of the Bankruptcy Courts for the Western District of Texas. That rule refers to motion practice but does not specify which motions it controls. First Savings notes that motions for summary judgment are governed by F.R.Civ.P. 56, made applicable by Bankruptcy Rule 7056. The order of May 22,1985, adopting the Local Bankruptcy Rules provides that “The Local District Court Rules for the Western District of Texas, effective March 1, 1982 as amended are expressly made applicable to all cases and proceedings before the Bankruptcy Court.” Motion practice in District Court, including summary judgment, is governed by Local District Rule 300-5. Motions within an adversary proceeding are generally controlled by the Federal Rules of Civil Procedure as made applicable by Part VII of the Bankruptcy Rules. The Court finds and holds the Local District Rule 300-5 applies to any and all motions filed within an adversary proceeding. Local Bankruptcy Rule 9013 applies to motions filed within a bankruptcy ease, but not within an adversary proceeding.
Rule 300-5(e) of the Local Rules for the District Court of the Western District of Texas states “if a party opposes a motion, the respondent shall file a response ... within the time prescribed by subsection (f). Subsection (f) allows a party ten days to respond.” Local Bankruptcy Rule 9013(b)(3) provides, “if no response in opposition to a motion is received within twenty (20) days after the date reflected in the Certificate of Service, the motion may be granted without further notice.” Defendant failed to respond to Plaintiff’s Motion for Summary Judgment. According to both the Local District Rules and the Local Bankruptcy Rules, the Court could assume the motion was unopposed and grant the motion without a hearing.
*15All parties coming before this Court are charged with notice of all the local rules. Although Rule 56, Federal Rules of Civil Procedure, speaks of a ten (10) day notice of hearing, the mere filing of Plaintiffs Motion for Summary Judgment put Defendant on notice that the Court could assume the motion was unopposed and that the motion could be granted without further notice to Defendant if Defendant failed to respond thereto. Further, 11 USC § 102 states in part as follows:
(1) “after notice and a hearing”, or a similar phrase—
(A) means after such notice as is appropriate in the particular circumstances, and such opportunity for a hearing as is appropriate in the particular circumstances; but
(B) authorizes an act without an actual hearing if such notice is given properly and if—
(i) such a hearing is not requested timely by a party in interest; or
(ii) there is insufficient time for a hearing to be commenced before such act must be done, and the court authorizes such act;
Inasmuch as Defendant admitted timely receipt of Plaintiffs Motion for Summary Judgment, failed to respond to it, failed to request a hearing thereon, and was charged with the notice provisions of Local District Rule 300-5 and Local Bankruptcy Rule 9013(b)(3), the entry of judgment by the Court was entirely proper. Therefore, the Court will enter an order denying First Savings’ Motion for Relief from Summary Judgment. | 01-04-2023 | 11-22-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/8490723/ | OPINION
Before VOLINN, PERRIS and MEYERS, Bankruptcy Judges.
VOLINN, Bankruptcy Judge.
Imperial Bank, a creditor with a judgment lien against debtor's residence, appeals the bankruptcy court’s “Order Granting Application to Enter into New Early Possession Agreement and to Modify Consulting Agreement” (“the Order”). The dispute concerns the proper classification and disposition of $50,000 to be paid to the debtor and his non-debtor spouse by the purchasers of their home for surrender of the residence before a certain date.
FACTS
Debtor B. Durward Howes is a Chapter 11 debtor in possession. He is not a party to the appeal, but his non-debtor spouse, Cynthia Howes, is one of the appellees. On January 27, 1987, debtor applied to the court for authorization to sell the estate’s community property one-half interest in the Howes’ residence to appellee Davis Pillsbury. The proposed sale of the estate’s one-half interest and Cynthia Howe’s one-half interest provided for payment of $1,400,000 cash. An “early surrender” agreement, executed at about the same time as the sale agreement, provided that debtor and his spouse could occupy the property for up to one year from the date of closing rent-free, with the buyer to pay utilities, insurance, property taxes, maintenance and landscaping of the property at no expense to the debtor. In addition, if debtor vacated and surrendered the premises to the Pillsburys by September 1, 1987, the purchaser would pay $50,000 to debt- or’s spouse as consideration for early possession. The bankruptcy court approved the sale, and in the order approving the sale, stated that any funds received by the debtor’s spouse as a premium for early surrender of the premises were to be deposited in a trust account to be deemed held in constructive custody of the court, pending further order of the court.
On September 1, 1987, the expiration date of the original early surrender agreement, the purchaser applied to the bankruptcy court for approval to enter into a new early surrender agreement, whereby he would pay $50,000 directly to debtor’s spouse if debtor and his spouse vacated the premises by September 4, 1987. Pillsbury proposed to pay the $50,000 as follows: *79$15,000 to the company that would be moving the Howes out of their residence and $35,000 to the Huntington Sheraton Hotel for one year’s advance rent for debtor and his spouse.
The court granted Pillsbury’s application: he was entitled to enter into a new early possession agreement with debtor and his spouse pursuant to which Pillsbury would pay the Howes $50,000 if they vacated the property by September 4, 1987; Pillsbury was to make the payment directly to the debtor and his wife; and the $50,000 was to be received by debtor in his fiduciary capacity as debtor in possession. The Order stated that it was entered without prejudice to Imperial Bank and other judgment lien creditors bringing any matter before the court, whether by adversary proceeding or otherwise, with respect to the propriety of the purposes to which debtor and his spouse may put the $50,000. Imperial Bank appeals the entry of that order. Ap-pellees are Cynthia Howes, debtor’s spouse, and Davis Pillsbury, the purchaser.
DISCUSSION
The appellees contend that issues raised by the appellant are not ripe for review. The bankruptcy court in the Order did not award the $50,000 payment to the Howes; it merely stated that the money was to be paid to the debtor in his fiduciary capacity as a debtor in possession. The court invited the appellant and other creditors to bring on a matter before the court to determine the propriety of the purposes to which the debtor and his spouse could put the money. Appellees emphasize that the court never resolved the issue of who was entitled to the money under the early possession agreement; it only determined that the Pillsburys could enter into the second early possession agreement.
We agree that the appeal is not ripe and should be dismissed. The question of ripeness goes to the appellate court’s subject matter jurisdiction to hear the case. Shelter Creek Dev. Corp. v. City of Oxnard, 838 F.2d 375, 377 (9th Cir.1988). The central concern of the ripeness doctrine is that the case involves uncertain and contingent future events that may not occur as anticipated, or indeed, may not occur at all. Metzenbaum v. Fed. Energy Regulatory Comm’n, 675 F.2d 1282, 1289-90 (D.C.Cir.1982). The question of ripeness turns on the fitness of the issues for judicial decision and the hardship to the parties of withholding court consideration. Pacific Gas & Electric Co. v. State Energy Resources Conservation & Dev. Comm’n, 461 U.S. 190, 201, 103 S.Ct. 1713, 1720, 75 L.Ed.2d 752 (1983); Abbott Laboratories v. Gardner, 387 U.S. 136, 149, 87 S.Ct. 1507, 1515, 18 L.Ed.2d 681 (1967); In re Dominelli, 788 F.2d 584, 585 (9th Cir.1986).
In this appeal, Imperial Bank challenges the propriety of the $50,000 payment to debtor and his spouse on the theory that the $50,000 represents proceeds from the sale of its collateral to which its lien should attach. Imperial Bank contends that the appeal is ripe because the Order represents an implicit acknowledgment that the debtor and his spouse may spend the money free and clear of creditors’ liens, without providing adequate protection to the secured creditors, in violation of the court’s prior sale order and 11 U.S.C. § 363(g).1
We conclude that the Order is explicit and states that the $50,000 shall be received by the debtor in his fiduciary capacity as debtor in possession, and that the entry of the Order is without prejudice to Imperial Bank bringing any matter before the bankruptcy court, whether by adversary proceeding or otherwise, with respect to the propriety of the uses to which debtor and his wife may put the $50,000. The gravamen of Imperial Bank’s complaint is that debtor will breach his duties as a fiduciary. However, that is only speculation and has no grounding in the record. Thus, the appeal arises from what is now a hypothetical set of facts. In addition, the case is not suitable for appellate review *80because Imperial Bank did not avail itself of the invitation to bring on a matter in bankruptcy court to determine the propriety of the debtor’s application of the $50,000 payment. Imperial Bank will not suffer great hardship by our dismissal of this appeal because it has an avenue for relief yet available in the bankruptcy court.
The appeal is dismissed.
. 11 U.S.C. § 363(o) addresses the burden of proof under section 363 of the Bankruptcy Code. | 01-04-2023 | 11-22-2022 |
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