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TCL > January 2012 Issue > Summaries of Selected Opinions

January 2012       Vol. 41, No. 1       Page  139
From the Courts
U.S. Court of Appeals for the Tenth Circuit

Summaries of Selected Opinions

Summaries of selected Tenth Circuit Court of Appeals Opinions appear on a space-available basis. The summaries are prepared for the Colorado Bar Association (CBA) by Katherine Campbell and Frank Gibbard, licensed Colorado attorneys. They are provided as a service by the CBA and are not the official language of this Court. The CBA cannot guarantee the accuracy or completeness of the summaries. Full copies of the Tenth Circuit decisions are accessible from the CBA website: (click on "Opinions/Rules/Statutes").

No. 09-3275. Jones v. United Parcel Service, Inc. 10/24/2011. D.Kan. Chief Judge Briscoe. Retaliatory Discharge—Workers’ Compensation Filing—Damages Award Decided by Jury—Federal Due Process Rights.

Plaintiff sued his former employer, United Parcel Service, Inc. (UPS), claiming he was discharged in retaliation for filing a workers’ compensation claim. A jury found in plaintiff’s favor and awarded him $2.5 million in actual and punitive damages. UPS appealed, asserting that (1) it was entitled to a judgment as a matter of law on the merits and on the punitive damages claim; (2) the district court erred in allowing the jury to decide the amount of punitive damages; and (3) the $2 million punitive damages award violated its federal due process rights.

The Tenth Circuit held that the evidence supported the jury’s verdict on plaintiff’s retaliation claim. The Circuit then ruled that the district court did not err in instructing the jury to determine the proper amount of punitive damages, relying on F.R.C.P. 38 and the Seventh Amendment right to a jury trial in federal cases. The amount of punitive damages, however, was excessive and violated UPS’s federal due process rights. The Circuit remanded the case to permit plaintiff to choose between a new trial solely to determine punitive damages or acceptance of a remittitur to be determined by the district court. The district court’s judgment was affirmed in part and reversed in part, and the case was remanded.

No. 10-3113. United States v. Randall. 11/01/2011. D.Kan. Judge Ebel. RICO Conspiracy—Withdrawal From Conspiracy—Necessity of Jury Unanimity Concerning Predicate Acts.

A jury convicted defendant of one count of conspiracy to violate the Racketeer Influenced and Corrupt Organizations (RICO) Act. Defendant joined the Insane Crips gang when he was a teenager. He allegedly sold controlled substances for the Crips at various times between 1991 and 2007.

When he was in prison on drug charges, defendant tried to distance himself from the Crips. He informed officials of the Kansas Department of Corrections that he no longer was part of the gang.

When he was released from prison, he obtained work as a mechanic, had children, and began attending church. He later began using drugs again, purchased drugs from members of the Crips, allegedly sold ecstasy at a bar frequented by Crips members, and was filmed at an attempted drug buy involving a confidential informant.

On appeal, defendant argued that the jury should have been instructed on the affirmative defense of withdrawal from a conspiracy, based on his efforts to distance himself from the Crips. In general, to establish this affirmative defense, a defendant either must disclose the scheme to law enforcement authorities or make a reasonable effort to communicate his withdrawal to his co-conspirators. To withdraw from a conspiracy by reporting it to the authorities, a defendant must report the conspiracy to an official who has some ability to act on the information given in an attempt to end the conspiracy. To withdraw by communicating withdrawal to co-conspirators, the defendant must clearly communicate his or her withdrawal to those with authority in the conspiracy.

Here, defendant failed to establish either of these methods of withdrawal. His efforts at distancing himself from the gang by "maturing out" and ceasing his involvement in gang activities and his statements about self-rehabilitation to prison authorities were insufficient for this purpose. Thus, the district court did not err in failing to give a withdrawal instruction.

Defendant also argued that the district court committed plain error by failing to instruct the jury that to sustain his conviction for RICO conspiracy, it had to agree unanimously on the predicate acts he had agreed to. He argued that it was not enough to tell the jury that it had to be unanimous concerning the types of predicate racketeering activity he agreed would be committed; instead, the jury should have been instructed that it had to agree unanimously on the specific predicate acts that supported the conspiracy charge. The Tenth Circuit disagreed. Because the charge was conspiracy rather than the commission of a substantive RICO offense, the jury only needed to reach unanimity concerning the type of predicate racketeering acts defendant committed, not as to the specific predicate acts themselves.

Finally, the Circuit determined that in light of defendant’s failure to show any error, the doctrine of cumulative error did not apply. Accordingly, it affirmed defendant’s conviction.

No. 11-7026. Adams v. Astrue. 11/01/2011. E.D.Okla. Judge Kelly. Social Security—Supplemental Security Income Benefits—Non-Attorney Parent May Represent Minor Child.

Plaintiff, appearing pro se, sought to appeal the denial of Social Security Supplemental Security Income (SSI) benefits to her minor son. The Tenth Circuit sua sponte raised the issue of whether plaintiff, a nonattorney, could represent the interests of her son. The Circuit joined two other circuits to hold, as a matter of first impression, that a nonattorney parent may represent the interests of his or her minor child in appeals from administrative SSI decisions. The Circuit upheld the order on the merits, denying benefits.

No.10-1494. United States v. Lopez-Macias. 11/07/2011. D.Colo. Judge Baldock. Sentencing Disparities—Unwarranted Disparities Involving Fast-Track Immigration Program—Sentencing Court’s Authority to Vary Downwardly From Guidelines Sentence.

Defendant pleaded guilty to illegal re-entry into the United States after deportation, following an aggravated felony conviction. In connection with sentencing, defendant filed a motion requesting that the court vary downward from the U.S. Sentencing Guidelines (Guidelines) sentence and sentence him to time served, to avoid disparities with defendants convicted of immigration offenses in fast-track districts.

Fast-track sentencing authorizes the district court to depart downwardly from the Guidelines sentence if the attorney general files a motion pursuant to an authorized early disposition program. This program was not available in the District of Colorado, where defendant was convicted. The district court denied the motion and sentenced defendant to thirty-seven months’ imprisonment.

On appeal, defendant argued that the district court erred by failing to consider, as a sentencing factor, whether disparities between himself and defendants sentenced under fast-track programs were "unwarranted" within the meaning of the federal sentencing statute. Notwithstanding earlier Tenth Circuit authority holding that sentencing disparities caused by the existence of fast-track programs in some districts were not "unwarranted," defendant argued that intervening Supreme Court authority permitting district courts to vary categorically from an advisory Guidelines sentence due to disparities in crack and powder cocaine sentences also granted district courts authority to vary based on disparities created by fast-track sentencing.

The Circuit agreed that a sentencing court may take into account the effect of fast-track dispositions in determining whether unwarranted disparities exist. A district court must conduct a "holistic inquiry" of the sentencing factors in determining whether a downward variance is justified on this basis. Thus, unwarranted disparity on this basis is merely one sentencing factor to be considered by the district court.

Here, the district court had ruled alternatively that even if it had the discretion to vary downward based on the fast-track disparity, no unwarranted disparity existed in defendant’s case. This was because he offered no evidence that he would have qualified for a fast-track program in another district where such programs were available. Defendant argued that because the government does not publish the criteria for eligibility for fast-track programs, it was the government’s duty to prove that he was ineligible for the program. The Circuit found that this argument had some force, but reiterated that it was defendant’s burden to establish his entitlement to a downward variance. Even in the absence of published criteria, defendant could have presented some evidence by, for example, examining plea agreements of similarly situated defendants in fast-track districts. Because defendant presented no evidence, the district court was justified in rejecting his claim to a variance. Accordingly, the Circuit affirmed his sentence.

No. 10-4104. United States v. Strohm. 11/08/2011. D.Utah. Judge Tymkovich. Perjury—Ambiguity in Questions Answered Under Oath—Defenses of "Literal Truth" and Materiality.

Defendant was convicted of one count of perjury based on her testimony during a court hearing in a case against her employer, ClearOne Communications, Inc. (ClearOne), brought by the Securities and Exchange Commission (SEC). The SEC had been investigating ClearOne for potential securities law violations related to improper revenue recognition, accusing the company of attempting to inflate revenues by shipping more product than distributors had ordered or paid for. The evidence showed that at the end of the 2001–02 fiscal year, defendant unilaterally raised the sales price for products to be shipped to a company known as Production Audio, to help ClearOne meet its year-end numbers. At the injunction hearing, defendant’s counsel asked her whether she had been involved in a sale of ClearOne products to Production Audio during fiscal year 2002. She denied involvement in the sale and stated she did not know when it first came to her attention that ClearOne had sold products to Production Audio. She further claimed she did not know whether her knowledge came before or after the end of the fiscal year. The district court ultimately denied the injunction sought by the SEC.

On appeal from her perjury conviction, defendant argued that the question about her involvement in the Production Audio sale was ambiguous. Ambiguity will not defeat a perjury conviction where the evidence demonstrates that the defendant understood the question in context and gave a knowingly false answer. Defendant argued that the words "involved" and "sale" had many possible meanings. The Tenth Circuit disagreed. Under the circumstances, these words were neither fundamentally ambiguous nor so arguably ambiguous that a jury could not assess how defendant understood the question and whether her response was truthful when she denied involvement in the Production Audio sale. Also, her answers were not "literally true"—that is, indisputably true though misleading. Rather, there was sufficient evidence demonstrating beyond a reasonable doubt that her answers were knowingly false. Among other things, the evidence showed that defendant increased the price of the Production Audio shipment just before the end of the fiscal year to ensure ClearOne would make its revenue projections. Thus, the evidence showed that she learned about the sale before the end of the fiscal year.

Finally, defendant argued that the government failed to prove her testimony was material to the district court’s decision concerning whether to grant the SEC’s requested injunction. False statements are "material" where they have a natural tendency to influence—or be capable of influencing—the decision required to be made. Although defendant had been suspended from ClearOne at the time of the hearing, and the SEC sought only to enjoin future violations of the securities laws, her testimony was "material." Defendant’s alleged actions were an example of alleged fraudulent accounting practices at ClearOne and had a bearing on whether a preliminary injunction was needed to stop future transgressions. Accordingly, the Circuit affirmed defendant’s conviction.

No. 10-3307. United States v. Soto. 11/08/2011. D.Kan. Judge Gorsuch. Withdrawal of Plea—Intentional Misrepresentation Indicating Lack of Knowing and Voluntary Plea—Obstruction of Justice and Acceptance of Responsibility as Sentencing Factors in Light of Intentional Misrepresentation Concerning Plea Factors.

Defendant pleaded guilty to drug, money laundering, and firearms charges. He entered his plea without a plea agreement. A few months later, before he had been sentenced, he sought to withdraw his plea. He claimed that his plea had been involuntary because his attorney had promised him a fifteen-year sentence if he agreed to admit his guilt (a representation that defendant later learned counsel had no authority to make). During the plea colloquy, defendant had indicated to the court that he understood his plea guaranteed him no specific sentence. However, he later claimed that counsel had told him to answer "yes" to the district court’s questions during the plea colloquy whether or not he understood them. Defendant’s counsel asserted that he told defendant he would ask the court for a fifteen-year sentence, but made no promise to defendant concerning his eventual sentence. Counsel also asserted that he did not tell defendant to answer "yes" to questions he did not understand.

The district court did not find defendant’s testimony credible. It concluded that his plea was entered voluntarily, and accordingly denied the motion to withdraw. At sentencing, the district court further compounded the effect of this adverse credibility finding by adding a sentencing enhancement for obstruction of justice and by denying a reduction for acceptance of responsibility. The district court then sentenced defendant to 420 months’ imprisonment.

On appeal, defendant first argued he should have been allowed to withdraw his guilty plea. The Tenth Circuit rejected this argument. The district court does not abuse its discretion in denying leave to withdraw a guilty plea where the motion relies solely on a claim that the plea wasn’t knowing and voluntary, and where that claim is predicated on the defendant’s own intentional falsehood. Here, the district court made a factual finding that defendant intentionally lied, and defendant failed to present sufficient facts to show that finding was clearly erroneous.

The Circuit also rejected defendant’s challenge to the sentencing enhancement and reduction arguments. Defendant’s attempt to "scuttle a previously entered plea" with an intentional lie satisfied the criteria for obstruction of justice and justified denying him a sentence reduction for acceptance of responsibility. Finally, the Circuit rejected defendant’s claims that his sentence was substantively unreasonable. The district court provided adequate reasons to justify the sentence it awarded and its choice was not an irrational one.

No. 11-1068. TW Telecom Holdings Inc. v. Carolina Internet Ltd. 11/15/2011. D.Colo. Judge Gorsuch. Bankruptcy—Automatic Stay—Appeal Filed by Debtor—Reversal of Circuit Precedent.

Defendant appealed a judgment against it entered in favor of plaintiff. While the appeal was pending, defendant filed for Chapter 11 bankruptcy protection. Heretofore, the Tenth Circuit has held that appeal taken by a bankruptcy debtor is not subject to the automatic stay in bankruptcy. Joining several other circuit courts holding to the contrary, the Circuit overruled its precedent and announced that from this date forward, the automatic stay applies to stay all appeals in proceedings that were originally brought against the debtor, regardless of whether the debtor is the appellant or appellee. Accordingly, this appeal was stayed pursuant to the automatic stay in bankruptcy.

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