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TCL > September 2004 Issue > Tenth Circuit Summaries

September 2004       Vol. 33, No. 9       Page  155
From the Courts
U.S. Court of Appeals for the Tenth Circuit

Tenth Circuit Summaries

Summaries of selected opinions appear on a space-available basis. The summaries are prepared for the Colorado Bar Association by Jenine Jensen and Catherine Campbell, licensed Colorado attorneys. The summaries of the U.S. Court of Appeals for the Tenth Circuit are provided as a service by the Colorado Bar Association and are not the official language of the Court. The Colorado Bar Association cannot guarantee the accuracy or completeness of the summaries.

Full copies of the Tenth Circuit decisions are available on the CBA website at http: // (United States Courts link to the Tenth Circuit). Call The Colorado Lawyer Editorial Offices with questions: (303) 860-1118.

Discretion to Grant Downward Departure—Diminished Capacity—Mental and Emotional Conditions—Circumventing Limitations of § 5K2.13

U.S. v. Sheehan, No. 03-4239, 6/15/04, D.Utah, Judge Anderson.

Defendant appeals the district court’s failure to recognize its discretion to depart downward, and requests a remand for an evidentiary hearing on the departure motion. He pled guilty to one Hobbs Act violation and two counts of using and carrying a firearm during a crime of violence. Defendant’s motion for a downward departure was based on a defense expert’s report that defendant suffered from acquired brain injury and seizure and mood disorders. The motion was denied, and the district court sentenced defendant to 441 months in prison.

The Tenth Circuit Court affirms, holding that it does have jurisdiction to consider this appeal. The district court unambiguously stated that it lacked authority to depart, pursuant to U.S.S.G. § 5K2.0, in any circumstances based on a defendant’s claim of diminished capacity. The Court is construing U.S.S.G. § 5H1.3 (mental and emotional conditions not ordinarily relevant in determining sentence except as "other grounds for departure"); § 5K2.0 (grounds for departure); and § 5K2.13 (diminished capacity may warrant downward departure, with certain exceptions, one of which applies here). It rejects defendant’s argument, because at the sentencing hearing he was invoking § 5K2.0 merely as a means of circumventing the limitations of § 5K2.13. Other Circuit Courts also have held that the prohibitions in § 5K2.13 cannot be circumvented by applying § 5K2.0 instead. The sentencing court can order a departure based on a defendant’s mental or emotional condition, pursuant to § 5K2.0. However, its application is not based on a defendant’s claim of diminished capacity. Instead, it is based on some other argument related to the defendant’s mental or emotional condition. The district court properly concluded that it lacked discretion to depart downward under § 5K2.0 based on diminished capacity, when such a departure was prohibited by the terms of § 5K2.13. The sentence is affirmed.

Dismissal for Lack of Jurisdiction—Excusable Neglect—Filing of Notice of Appeal—Excuse for Late Filing

U.S. v. Torres, Nos. 03-2182 & 03-2241, 6/16/04, D.N.M., Judge Hartz.

Defendant pled guilty to a drug offense, and reserved his right to appeal the district court’s denial of his motion to suppress. He did not file a notice of appeal until after the ten-day period for filing a criminal appeal, set forth in Fed.R.App.P. 4(b)(1), had passed. The case was partially remanded to the district court for it to assess whether the delay in filing was due to excusable neglect, which could be grounds for a thirty-day extension of the time to appeal. Defense counsel had incorrectly believed that defendant had thirty days after the entry of judgment in which to file the appeal, and the district court held that defendant’s untimeliness was the result of excusable neglect. A second appeal seeking review of the district court’s denial of defendant’s motion to suppress was consolidated with the first appeal.

The Tenth Circuit Court dismisses both appeals for lack of jurisdiction. The district court abused its discretion in finding that the untimely filing of the notice of appeal was due to excusable neglect. The Court applies the factors of Pioneer Investment Services Co. v. Brunswick Associates Limited Partnership, 507 U.S. 380 (1993), to this issue. Three of the relevant circumstances discussed in Pioneer weigh in favor of the district court’s finding of excusable neglect. However, the most important factor is the excuse given for the late filing. The reason for this delay was that defense counsel confused the filing deadlines for civil and criminal appeals. The Court concludes that defense counsel’s misinterpretation of a readily accessible, unambiguous rule cannot be grounds for relief. The district court abused its discretion in finding that the delay in filing was the result of excusable neglect, so the Court lacks jurisdiction to hear defendant’s appeals. They are dismissed.

Jury Costs Assessed Against Attorneys—Failure to Report Settlement Immediately—Bad Faith Not Required—No Requirement to Apportion Costs—Due Process Sufficient

Sally Beauty Co. v. Beautyco, Inc., No. 03-6055, 6/21/04, W.D. Okla., Judge Lucero.

The underlying case was settled the evening before the jury trial was to begin. As the jurors waited, the district court received the settlement and entered judgment. Thereafter, the court taxed the expense of the jury impanelment (about $400) on the attorneys for both sides, because they had not informed the court of the settlement in time to tell the jurors not to come to court.

The Tenth Circuit Court finds no abuse of discretion in the order taxing jury costs on both counsel. It declines to adopt a requirement that an attorney act in bad faith before being subject to having costs assessed. The Court holds that the district court was not required to apportion costs according to the relative fault of the attorneys, because there was no indication that either of the attorneys was particularly responsible for the late settlement. In addition, it was reasonably foreseeable that jury costs would be assessed if the jury was required to appear unnecessarily. The district court’s order assessing jury costs on the attorneys for both parties is affirmed.

Waiver of Right to Appeal—Scope of Waiver—District Court’s Advisement—Modification of Waiver

U.S. v. Arevalo-Jimenez, No. 02-2335, 6/22/04, D.N.M., Judge McKay.

Defendant appeals the district court’s ruling that certain misdemeanor convictions were properly included in his criminal history calculations. In the plea agreement, defendant waived his right to appeal. The Tenth Circuit Court, in U.S. v. Hahn, 359 F.3d 1315 (10th Cir. 2004), adopted a three-prong analysis for reviewing appeals brought after a defendant has agreed to such a waiver. The prongs are to determine whether the disputed appeal falls within the scope of the waiver, whether defendant knowingly and voluntarily waived his appellate rights, and whether enforcing the waiver would result in a miscarriage of justice.

In this case, the Court upholds the waiver. The waiver that defendant signed was broad. It was not modified, even though the district court advised defendant at sentencing that he could appeal the issues relating to the calculation of his criminal history and the government failed to object. The government’s failure to object did not modify the waiver, because there was no written and signed agreement to modify it. Defendant’s waiver was made knowingly and voluntarily. Enforcement of defendant’s waiver would not be a miscarriage of justice under Hahn. The waiver is enforced and the appeal is dismissed.

Stock Broker—Breach of Contract—Fraud—Promissory Estoppel—Colorado Consumer Protection Act—Fiduciary Duty

Dean Witter Reynolds Inc. v. Variable Annuity Life Ins. Co., No. 02-1418, 6/29/04, D.Colo., Judge McConnell.

Defendant stock broker ("VALIC") mailed a check to plaintiff stock broker ("Dean Witter") upon the instructions of Mrs. Bass to transfer her account to Dean Witter. The check was stolen and the thief used it to open a bank account. VALIC delayed stopping payment on the check until after the thief began to deplete the account. Dean Witter reimbursed Mrs. Bass for the loss, and she assigned her claims to Dean Witter. Dean Witter sued VALIC to recover the stolen funds. The district court entered summary judgment in favor of VALIC.

The Tenth Circuit Court evaluates whether VALIC had breached its contract with Mrs. Bass by considering whether the check was a bailment or a debt to Mrs. Bass. The Court holds that the check represented VALIC’s attempt to satisfy its debt and that VALIC’s responsibility was not discharged by the act of mailing the check. Even if mailing were all that was required of VALIC, the evidence did not show conclusively that the check was placed in the mail, while Dean Witter’s evidence indicated that it had never received the check. Therefore, summary judgment was inappropriate because all inferences were to be drawn in favor of Dean Witter, as the party opposing the motion.

The Tenth Circuit Court also addresses Dean Witter’s fraud and promissory estoppel claims. Dean Witter alleged that VALIC assured Mrs. Bass that it had stopped payment on the check when, in fact, it had not, and that Mrs. Bass, relying on this misinformation, ceased her efforts to find the lost check. Dean Witter’s role in permitting the loss to occur was irrelevant because, as Mrs. Bass’s assignee, it stood in her shoes. Based on Mrs. Bass’s diligence in locating the lost check, a jury could find that the theft would have been prevented if VALIC had given her correct information. Accordingly, summary judgment was not warranted.

The Tenth Circuit Court also remands for trial Dean Witter’s claim that VALIC’s policy to give misleading information to its customers violated the Colorado Consumer Protection Act. Although a close question, the evidence survived summary judgment on whether the harm experienced by Mrs. Bass was the type of public harm covered by the act. Finally, the Tenth Circuit Court holds that VALIC did not breach a fiduciary duty to Mrs. Bass because no fiduciary relationship existed between them. The district court’s summary judgment in VALIC’s favor is affirmed in part, reversed in part, and remanded.

Americans with Disabilities Act—Inconsistent Verdicts—Punitive Damages—Qualified Individual—Reasonable Accommodation— Interactive Process

Bartee v. Michelin North America, Inc., Nos. 03-6071 & 03-6086, 6/29/04, W.D.Okla., Chief Judge Tacha.

Plaintiff was employed by defendant in a position that required him to move about a sizeable plant to oversee the workers. He had a condition that made walking and prolonged sitting painful, so he requested a large golf cart. Defendant provided a small cart, but it aggravated plaintiff’s condition. Plaintiff then took disability leave until defendant discharged him at the end of twelve months, according to its policy. Plaintiff sued, under the Americans with Disabilities Act ("ADA"), for failure to provide reasonable accommodation and wrongful termination. After a trial, the jury returned verdicts in plaintiff’s favor on his reasonable-accommodation claim, but against him on this wrongful-termination claim. Both parties appealed.

The Tenth Circuit Court addresses plaintiff’s claim that the district court improperly adjudicated his claim for back pay. In considering this claim, the Court interprets whether the jury verdicts were inconsistent, and concludes they were not. An equitable award of back pay must be based on the jury’s explicit findings and those necessarily implicit in its verdicts. But the district court’s findings were inadequate to determine whether the award was based on the jury’s verdicts, so the back-pay award was remanded. The denial of punitive damages was affirmed because there was no evidence that defendant acted with malice or reckless indifference, or that it knew it had violated the ADA.

The Tenth Circuit Court finds the evidence sufficient for the jury to conclude that plaintiff was a qualified individual with a disability. The evidence also supported the jury’s finding that defendant had not participated in the required interactive process, the purpose of which is to explore and arrange a reasonable accommodation of an employee’s disability. Defendant had not inquired about plaintiff’s restrictions or the accommodations he would need. The district court’s judgment is affirmed in part and reversed in part, and the case is remanded.

False Statement—Sufficiency of Materiality Requirement—Motion for Judgment of Acquittal—Evidence at Time Ruling is Reserved

U.S. v. Finn, No. 03-1354, 7/13/04, D.Colo., Judge Briscoe.

Defendant is a former special agent with the U.S. Department of Housing and Urban Development ("HUD"). He appeals his conviction of knowingly and willfully making a false statement, arguing that the evidence at trial was insufficient to satisfy the materiality requirement of 18 U.S.C. § 1001(a)(3). His government-issued vehicle was towed from a loading dock. When defendant went to the towing company, he refused to pay and drove the vehicle away, damaging the fence in doing so. At defendant’s direction, an agent working under defendant’s supervision took money out of the office’s "cash box" to pay the towing fee and the damage caused by defendant. The employee filled out a case expenditure form to document the expense and, again at defendant’s direction, described the expense as "storage" rather then damage to the fence. Defendant was indicted on one count of embezzling $200. Count two alleged that defendant knowingly and willfully made and used a false writing and document (the HUD expenditure form). At trial, defendant moved for acquittal at the close of the government’s case. The court reserved ruling. The motion for judgment of acquittal was later denied, after trial.

The Tenth Circuit Court reverses the conviction. Because defendant moved for judgment of acquittal at the close of the government’s evidence and the court reserved ruling until after trial, the sufficiency question must be decided on the basis of the evidence at the time the ruling was reserved, without regard to the evidence presented by defendant. The evidence presented by the government that may have been sufficient to support a finding of materiality was presented only after the government had rested its case, after defendant moved for judgment of acquittal, and after the district court had reserved ruling on that motion. A finder of fact reasonably could not have inferred from the government’s evidence that HUD at any time could or would have examined the case expenditure form at issue in order to determine the propriety of the underlying expense, or for any other articulated purpose. The government’s evidence was insufficient to allow the jury reasonably to find that the false statements at issue were material. The conviction is vacated.

Conditional Guilty Plea—Waiver of Right to Appeal—Specific Arguments Preserved for Appeal

U.S. v. Anderson, No. 03-1137, 7/6/04, D.Colo., Judge Tacha.

Defendant entered a conditional plea of guilty to a firearm charge, reserving his right to appeal the district court’s order on the denial of his motion to suppress evidence and statements. The court’s order addressed defendant’s argument that his consent to search his trailers was invalid because officers lacked probable cause to arrest him for possessing drug paraphernalia. Defendant appeals the denial of his motion to suppress, but on appeal advances a theory different from the theory in the district court. He now argues that the officers’ allegedly improper pre-arrest patdown search tainted the evidence.

The issue is whether defendant’s plea agreement reserved this "improper patdown" argument. The Tenth Circuit Court holds that it does not. The Court applies the analysis of U.S. v. Hahn, 359 F.3d 1315 (10th Cir. 2004), to conditional plea agreements that waive the right to appeal a conviction. The plea agreement must specifically mention any argument that is to be preserved for appeal. Here, defendant did not preserve the improper patdown issue for appeal. Thus, that theory falls outside the scope of his reserved appellate rights. Defendant knowingly and voluntarily entered into his plea agreement. The burden rests with defendant to show that the appeal waiver results in a miscarriage of justice. Because the Court had not placed this burden on defendant until now, it conducts an independent review of the record and finds that enforcement of the waiver would not constitute a miscarriage of justice. The appeal is dismissed.


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