Vol. 32, No. 3
From the Courts
U.S. Court of Appeals for the Tenth Circuit
Tenth Circuit Summaries
Felon in Possession of a Firearm—Lawful Sporting Purposes or Collection—U.S.S.G. § 2K2.1(b)(2)—Surrounding Circumstances—Actual or Intended Use
U.S. v. Collins, No. 01-4196, 12/20/02, D.Utah, Judge Lucero.
Defendant appeals his sentence. He pled guilty to being a felon in possession of a firearm. He argues that the district court erred in refusing to apply a reduction in base offense level for the possession of ammunition and firearms solely for lawful sporting purposes or collection, under U.S.S.G. § 2K2.1(b)(2). Defendant took his auto to a repair shop to have work done. He could not pay for the repairs, so he left his hunting rifle as security for payment. After paying the amount he owed, he again used his rifle as collateral for the balance of the debt owed. The rifle was taken from the shop by the FBI and defendant was arrested. He pled guilty to being a felon-in-possession and moved for application of § 2K2.1(b)(2), which gives a reduction to defendants who possess ammunition or firearms solely for sporting purposes or collection and do not unlawfully discharge or unlawfully use the firearms. The district court denied the motion, holding that his use of the gun as collateral precludes, of itself, application of the offense-level reduction because it shows that the purpose of possession was not "solely" a sporting one. There was no evidence that defendant’s purpose in possessing the gun was otherwise anything other than a lawful sporting one.
The Tenth Circuit Court vacates the sentence, holding that examination of the surrounding circumstances is mandated. One aspect of surrounding circumstances is actual use. Actual or intended use is an important factor in determining the purpose of possession. However, the fact that the firearm has inherent monetary value that defendant exploited briefly on two occasions does not alter the nature of his purpose in possessing the firearm in the first place. It is uncontested that defendant did not use or discharge the firearm in an unlawful manner. The district court was incorrect in finding that application of the guideline was precluded by two instances of lawful, non-sporting use. On remand, the court should look to the "surrounding circumstances" to determine whether the purpose of defendant’s possession was solely a lawful sporting one and whether any use was unlawful. The sentence is vacated.
Bankruptcy—Reopen Case to Discharge Creditor—Debtor’s Intent Irrelevant—Date of Conduct
Watson v. Parker (In re Parker), No. 01-3251, 12/23/02, Bankruptcy Appellate Panel, Judge Seymour.
The bankruptcy court permitted the debtor to reopen his Chapter 7 case and amend his schedules to include a legal malpractice claim held by Plaintiff Watson. Watson objected, claiming that equity prevented the bankrupt from reopening the case and, alternatively, that her claim arose after the debtor’s discharge. The Bankruptcy Appellate Panel ("BAP") affirmed the bankruptcy court’s ruling. Watson appealed.
The Tenth Circuit Court addresses two issues of first impression. The first is whether a debtor’s intent in failing to schedule a claim is relevant to the decision to reopen a case in which there are no assets and no bar date. The Court holds that the debtor’s intent is irrelevant. The second issue is whether the date on which a claim arose is determined under a conduct theory, by which the conduct giving rise to the claim dictates the date, or an accrual theory, which determines the date of a claim by state-law liability rules. The Court adopts the conduct theory. Because Watson’s malpractice claim arose on the date it allegedly occurred, it was prior to the filing of the debtor’s petition. Accordingly, her claim is discharged. The judgment of the BAP is affirmed.
Venue—Forum Selection Clause—Permissive or Mandatory
K & V Scientific Co. v. Bayerische Motoren Werke Aktiengesellschaft (BMW), No. 02-2020, 12/23/02, D.N.M., Judge Briscoe.
The plaintiff was a New Mexico corporation that negotiated with defendant, a German corporation based in Munich, to develop and market new technology for automobile air bag systems. Defendant prepared a confidentiality agreement, which was signed by both parties. The agreement included a clause stating that jurisdiction for all disputes would be Munich and disputes would be subject to the laws of Germany. Ultimately, plaintiff sued defendant in a New Mexico state court, alleging it had abandoned business activities with plaintiff, and then proceeded to use his ideas for air bag systems. Defendant removed the case to federal court, where its motion to dismiss for improper venue was granted. Plaintiff appealed, contending that the forum selection clause was permissive, rather than mandatory.
The Tenth Circuit Court notes that a motion to dismiss based on a forum selection clause frequently is analyzed as a motion to dismiss for improper venue. Forum selection clauses frequently are classified as mandatory (clearly showing that jurisdiction is appropriate only in the designated forum) and permissive (authorizing jurisdiction in a designated forum but not prohibiting litigation elsewhere). The Tenth Circuit Court concludes that the forum selection clause in this case was permissive. Even if the clause were deemed to be ambiguous, it would be construed against defendant as the drafter, and would be deemed permissive. The judgment of the district court is reversed and the case is remanded.
Substantial Risk of Bodily Injury Under 18 U.S.C. § 4243(e)—Not Guilty by Reason of Insanity—Standard of Review—Evidentiary Standard
U.S. v. Gilgert, No. 02-4021, 12/27/02, D.Utah, Judge Henry.
Defendant pled not guilty by reason of insanity to a charge of making a threat against the President of the United States. After a hearing, the district court found that defendant had failed to prove that his release into the community "would not create a substantial risk of bodily injury to another person" under 18 U.S.C. § 4243(e), and committed defendant to the custody of the U.S. Attorney General. On appeal, the issues are the applicable standard of review, the applicable evidentiary standard, and whether the district court’s finding on the merits of defendant’s request for release constitutes reversible error.
The first issue is what standard of review applies to the district court’s decision applying § 4243. In a question of first impression, the Tenth Circuit Court holds that clear error review applies. In another question of first impression, the Court addresses what evidentiary standard applies under § 4243(d) when defendant was convicted of making a threat against the U.S. President, in violation of 18 U.S.C. § 871. A defendant who pleads not guilty by reason of insanity to making a threat against the U.S. President, in violation of this statute, is required to prove by clear and convincing evidence that his release would not create a substantial risk of bodily injury to another person, or of serious damage to the property of another person, due to mental disease or defect affecting the defendant at that time. The final question is whether the district court clearly erred in finding that defendant failed to prove by clear and convincing evidence that his release would not create a substantial risk of bodily injury to another person under § 4243(e). Here, the district court did not clearly err. The district court’s finding is affirmed, as is the court’s commitment of defendant to the U.S. Attorney General’s custody.
Bankruptcy—Divorce—Attorney Fees Discharged—Unusual Circumstances
Lowther v. Lowther (In re Lowther), No. 01-6359, 12/31/02, Bankruptcy Appellate Panel, Judge McKay.
In the divorce between appellee and appellant, appellee was granted custody of their child and was ordered to pay $9,000 in attorney fees to appellant. Appellant was ordered to pay $167 per month for child support. Appellee then filed for bankruptcy, seeking to discharge her debts, including the $9,000 in attorney fees. When appellant objected, the bankruptcy court denied discharge. The Bankruptcy Appellate Panel ("BAP") reversed, holding that the attorney-fee debt was discharged.
On appeal, the Tenth Circuit Court acknowledges that generally divorce attorney fees are not dischargeable in bankruptcy because they are included in the term "support." The exception to this rule permits discharge of attorney fees under unusual circumstances. The exception applies where a discharge would be in the best interests of the child. The appellee’s status as the custodial parent was relevant, but not dispositive. Her monthly income was $893. Requiring her to pay the $9,000 in attorney fees essentially would negate the court-ordered support payments for at least five years, which would adversely affect her ability to financially support the child. These facts constitute unusual circumstances warranting the narrow exception to nondischargeability. The judgment of the BAP is affirmed.
Illegal Re-Entry as a Deported Alien—Plea in Abeyance—Aggravated Felony—Appellate Jurisdiction—Personal Approval for Government Appeal from Solicitor General—U.S.S.G. § 2L1.2(b)(1)(A)
U.S. v. Zamudio, No. 02-4006, 12/31/02, D.Utah, Judge Seymour.
The government appeals the defendant’s sentence. He pled guilty to illegal re-entry into the United States as a deported alien. Before this charge, defendant was deported after pleading guilty in Utah state court to distributing marijuana. He signed a "Plea in Abeyance" that provided that if he complied with the terms of the abeyance, his offense would be reduced to a misdemeanor. At sentencing for this offense, the government argued that defendant’s base offense level should be increased by sixteen levels, because his Utah plea in abeyance qualified as a conviction for an aggravated felony under the sentencing guidelines. The district court initially disagreed. When the government filed a motion to reconsider, the district court agreed with the government, holding that the initial sentence was erroneous. However, the court held that it lacked jurisdiction to review and correct its ruling, because the motion to reconsider fell outside the time frame in which the court could modify defendant’s sentence. The government argues on appeal that the district court erred by not subjecting defendant to a sixteen- level sentencing enhancement under U.S.S.G. § 2L1.2(b)(1)(A).
The Tenth Circuit Court reverses. The first issue is whether the Court lacks jurisdiction over the appeal because the government failed to comply with 18 U.S.C. § 3742(b). That statute permits the government to file a notice of appeal from a sentence if it has the personal approval of the Attorney General or other appropriate official. The Court holds that late submission of proof of approval from the Solicitor General does not deprive it of jurisdiction to hear the appeal. It is the government’s filing of the notice of appeal that establishes appellate jurisdiction, not the government’s obtaining of approval. The proof of approval provided in the government’s reply brief is sufficient under the statute. Second, the Court holds that defendant’s plea in abeyance satisfies the definition of "conviction" found in 8 U.S.C. § 1101(a)(48)(A). This plea also qualifies as a conviction of an aggravated felony under 8 U.S.C. § 1326(b)(2) and U.S.S.G. § 2L1.2(b)(1)(A). The court erred by not increasing defendant’s illegal re-entry sentence with a sixteen-level enhancement under the guidelines. The sentence is reversed and the case is remanded for resentencing.
Escape—Continuing Felony—Unconstitutionality of 18 U.S.C. § 922(g)(1)—Reckless Endangerment During Flight—Possession of Firearm in Connection with Another Felony Offense—Entry of Findings Under Fed.R.Crim.P. 32 in Response to Objections to Presentence Report
U.S. v. Brown, No. 02-5007, 1/6/03, N.D.Okla., Judge Kelly.
Defendant was convicted of possession of a firearm after being convicted of a crime punishable by more than one year in prison, in violation of 18 U.S.C. § 922(g)(1). He was sentenced to ten years in prison and payment of a $1,000 fine. On appeal, he challenges his conviction on the basis that the statute is unconstitutional as applied here. He challenges his sentence on four bases.
Defendant escaped from jail, and police later found him in possession of a gun. He argues that the statute is unlawful as applied to him, because the government should have been required to prove that the gun possession had an actual or substantial effect on interstate commerce. This argument is foreclosed by circuit precedent, so the argument is rejected by the Tenth Circuit Court. Next, the Court affirms the district court’s enhancement of defendant’s sentence under U.S.S.G. § 3C1.2 for reckless endangerment during flight. While trying to escape, defendant disposed of the gun in a water turn-off hole. At that location, children were climbing off a school bus. The district court held that defendant disposed of the gun in such a way as to make it accessible to grade school children, thus clearly placing the children in grave danger. This conclusion is supported by the record. The district court also enhanced defendant’s sentence under U.S.S.G. § 2K2.1(b)(5) for possessing a firearm in connection with another felony offense, concluding that defendant possessed the gun in furtherance of the continuing escape. The Court holds that for purposes of this guideline, every escape is sufficiently continuing so that possession of a gun subsequent to the initial departure from custody can qualify as being "in connection with" the escape. The district court’s reliance on the fact that defendant hesitated with his hand on the gun supports the finding that the gun was possessed in connection with the escape. The case is remanded to the district court for the ministerial task of entering a determination that it did not take certain controverted matters into account in imposing sentence, under Fed.R.Crim.P. 32(c)(1). Finally, the court did not commit plain error in imposing a fine. Even if defendant established a present inability to pay a fine, he did not establish a future inability to pay. The conviction and sentence are affirmed. The case is remanded for entry of a determination under Rule 32(c)(1) regarding the controverted matters.
Employment Discrimination—EEOC Found Discrimination—No Appeal of EEOC Remedy Only
Timmons v. White, No. 02-7016, 1/6/03, E.D.Okla., Judge Kelly.
Plaintiff was employed at an Army ammunition plant until his temporary appointment was terminated. Later, he learned that another temporary employee had been retained. He filed a complaint alleging age and disability discrimination. The Equal Employment Opportunity Commission ("EEOC") found that plaintiff had been discriminated against and ordered defendant to extend his appointment for one year (the same as that of the other temporary employee). The EEOC also awarded back pay. Defendant complied with the EEOC’s order. Thereafter, plaintiff filed this lawsuit, claiming that the EEOC’s order had not afforded him complete relief. The district court construed plaintiff’s action as one seeking additional relief and held that such an action was unavailable where the EEOC found that the federal employer complied with its order. Summary judgment was entered in defendant’s favor. Plaintiff appealed, claiming that he could seek a de novo review of the EEOC’s remedy without relitigating the underlying claim of discrimination.
The Tenth Circuit Court characterizes plaintiff’s complaint as a de novo proceeding, rather than as a proceeding to enforce the EEOC’s ruling. Addressing plaintiff’s claim of limited review, the Court holds that he was not entitled to limit the district court’s review to the issue of remedy only. The judgment of the district court is affirmed.
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